AMENDMENT TO FUND PARTICIPATION AGREEMENT
AMONG
40/86 SERIES TRUST,
40/86 ADVISORS, INC.,
and
JEFFERSON NATIONAL LIFE INSURANCE COMPANY
For good and valuable consideration, the receipt of which is hereby
acknowledged, the parties agree to amend the February 1, 2001 Fund
Participation Agreement among 40/86 Series Trust (the "Trust"), 40/86
Advisors, Inc., and Jefferson National Life Insurance Company (the
"Insurance Company") as follows:
1. Schedule A thereto is hereby modified by adding five new
segregated asset accounts of the Jefferson National Life Insurance Company to
that schedule, which shall read as follows:
SCHEDULE A
ACCOUNT(S) FORM #
- Jefferson National Life Annuity Account C 22-4025 (Individual)
32-4000 (Group)
- Jefferson National Life Annuity Account E 22-4047/32-4003 (Achievement)
22-4048/32-4002 (Educator)
- Jefferson National Life Annuity Account F 22-4061
- Jefferson National Life Annuity Account G 22-4056
- Jefferson National Life Annuity Account H CVIC-2000 or -2001(state specific)
- Jefferson National Life Annuity Account I CVIC-2004 or -2005(state specific)
- Jefferson National Life Annuity Account J JNL-2100
- Jefferson National Life Annuity Account K JNL-2200
- Jefferson National Life Account L CVIC-1001 and -1003
- Jefferson National Life Annuity Account M JNL-22-4061
- Jefferson National Life Annuity Account N JNL-2000
- Jefferson National Life Annuity Account O JNL-2004
2. All other terms of the Agreement shall remain in full force and
effect.
IN WITNESS WHEREOF, each of the parties hereto has caused this Amendment to
be executed in its name and on its behalf by its duly authorized
1
representative as of this date, March 30, 2004.
40/86 SERIES TRUST
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: Vice President and Secretary
40/86 ADVISORS, INC.
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇
----------------
Name: ▇▇▇▇ ▇▇▇▇▇▇▇
Title: President
JEFFERSON NATIONAL LIFE INSURANCE
COMPANY
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-------------------
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: General Counsel and Secretary
2
AMENDMENT TO
FUND
PARTICIPATION AGREEMENT
AMONG
CONSECO SERIES TRUST,
CONSECO EQUITY SALES, INC.,
AND
JEFFERSON NATIONAL LIFE INSURANCE
COMPANY
For good and valuable consideration, the receipt of which is hereby
acknowledged, the parties agree to amend the October 23, 2002
Fund Participation
Agreement (the "Agreement") among Conseco Series Trust (the "Fund"), Conseco
Equity Sales, Inc. (the "Distributor"), and Jefferson National Life Insurance
Company (formerly Conseco Variable Insurance Company) (the "Company") as
follows:
1. All references to "Conseco Variable Insurance Company" are hereby
changed to "Jefferson National Life Insurance Company", effective May 1, 2003.
This change reflects the change in the Company's name from Conseco Variable
Insurance Company to Jefferson National Life Insurance Company.
2. Schedule A thereto is hereby modified by changing the names of the
existing asset sub-accounts from "Accounts C, E, F, G, H, I and L" to "Jefferson
National Life Annuity Accounts C, E, F, G, H, I" and "Jefferson National Life
Account L" to that schedule effective May 1, 2003, which shall read as follows:
SCHEDULE A
ACCOUNT(S)
-Jefferson National Life Annuity Account C
-
Jefferson National Life Annuity Account E
-Jefferson National Life Annuity Account F
-Jefferson National Life Annuity Account G
-Jefferson National Life Annuity Account H
-Jefferson National Life Annuity Account I
-Jefferson National Life Account L
FORM#
22-4025 (Individual)
32-4000 (Group)
22-4047/32-4003 (Achievement)
22-4048/32-4002 (Educator)
22-4061
22-4056
CVIC-2000 or-2001 (state specific)
CVIC-2004 or -2005 (state specific)
CVIC-1001 and-1003
3. Article V, Fee and Expenses, Section 5.1 for the Agreement shall be amended
as follows:
The Fund, except the Money Market Portfolio, shall pay no fee or other
compensation to the Company under this Agreement. All portfolios, except the
Money Market Portfolio, will make payments to the Company or to the underwriter
for the contracts pursuant to its Rule 12b-1 plan to finance distribution
expenses in amounts agreed to by the Portfolio. Effective August 1, 2003, the
Money Market Portfolio shall make payments to the Company or to the underwriter
as a percentage of the value of the average daily net assets of the shares held
of record by an Account from time to time on behalf of a customer. The Fees will
be paid quarterly in arrears and are as follows:
ASSETS
------
$0 - $50 million 5 bps
$50-$150 million 15 bps
$150-$250 million 17.5bps
$250 million and over 20 bps
4. Effective August 1, 2003, if the Fund provides the Company with materially
incorrect share net asset value information, the Separate Account(s) shall be
entitled to an adjustment to the number of shares purchased or redeemed to
reflect the correct share net asset value. Any material error in the calculation
of the net asset value per share, dividend or capital gain information shall be
reported promptly upon discovery to the Company. Furthermore, the Fund shall be
liable for the reasonable administrative costs incurred by the Company in
relation to the correction of any material error, provided such error is
attributable to the Fund. Administrative costs shall include reasonable
allocation of staff
time, costs of outside service providers, printing and postage. Non-material
errors will be corrected in the next Business Day's net asset value per share.
5. All other terms of the Agreement shall remain in full force and effect.
IN WITNESS WHEREOF, each of the parties hereto has caused this Amendment to be
executed in its name and on its behalf by its duly authorized representative as
of this date, September 10, 2003.
CONSECO SERIES TRUST
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
----------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Title: President
CONSECO EQUITY SALES, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------
Name: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: VP and Secretary
JEFFERSON NATIONAL LIFE INSURANCE COMPANY
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Title: General Counsel
---------------
PARTICIPATION AGREEMENT
AMONG
CONSECO VARIABLE INSURANCE COMPANY
CONSECO SERIES TRUST,
AND
CONSECO EQUITY SALES, INC.
THIS AGREEMENT, dated as of the 23rd day of October, 2002 by and among
Conseco Variable Insurance Company, (the "Company"), a Texas domiciled life
insurance company, on its own behalf and on behalf of each segregated asset
account of the Company set forth on Schedule A hereto, as may be amended from
time to time (each account hereinafter referred to as the "Account"), Conseco
Series Trust (the "Fund"), a Massachusetts business trust, and Conseco Equity
Sales, Inc. (the "Distributor"), a Texas Corporation.
WHEREAS, the Fund engages in business as an open-end management
investment company and is available to act as the investment vehicle for
separate accounts established for variable life insurance and variable annuity
contracts (the "Variable Insurance Products") to be offered by insurance
companies which have entered into participation agreements with the Fund
("Participating Insurance Companies");
WHEREAS, the shares of beneficial interest of the Fund are divided into
several series of shares, each designated a "Portfolio" and representing the
interest in a particular managed portfolio of securities and other assets;
WHEREAS, the Fund is registered as an open-end management-investment
company under the 1940 Act and shares of the Portfolios are registered under the
Securities Act of 1933, as amended (the "1933 Act");
WHEREAS, the Distributor, which serves as Distributor to the Fund, is
duly registered as a broker-dealer under the Securities Exchange Act of 1934, as
amended (the "1934 Act"); and is a member in good standing of the National
Association of Securities Dealers, Inc. (the "NASD");
WHEREAS, the Company has issued or will issue certain variable life
insurance and/or variable annuity contracts supported wholly or partially by the
Account (the "Contracts"), and said Contracts are listed in Schedule A hereto,
as it may be amended from time to time by mutual written agreement;
WHEREAS, the Account is duly established and maintained as a segregated
asset account, duly established by the Company, on the date shown for such
Account on Schedule A hereto, to set aside and invest assets attributable to the
aforesaid Contracts; and
WHEREAS, to the extent permitted by applicable insurance laws and
regulations, the Company intends to purchase shares in the Portfolios listed in
Schedule A hereto, as it may be amended from time
to time by mutual written agreement (the "Designated Portfolios"), on behalf of
the Account to fund the aforesaid Contracts;
NOW, THEREFORE, in consideration of their mutual promises, the Company,
the Fund and the Distributor agree as follows:
ARTICLE I. SALE OF FUND SHARES
1.1. Subject to Article X hereof, the Fund agrees to make
available to the Company for purchase on behalf of the Account, shares of the
Designated Portfolios, such purchases to be effected at net asset value in
accordance with Section 1.3 of this Agreement. Notwithstanding the foregoing,
(i) Portfolios (other than those listed on Schedule A) in existence now or that
may be established in the future will be made available to the Company only as
the Fund may so provide, and (ii) the Board of Trustees of the Fund (the
"Board") may suspend or terminate the offering of shares of any Designated
Portfolio or class thereof, if such action is required by law or by regulatory
authorities having jurisdiction or if, in the sole discretion of the Board
acting in good faith and in light of its fiduciary duties under federal and any
applicable state laws, suspension or termination is necessary in the best
interests of the shareholders of such Designated Portfolio.
1 2. The Fund shall redeem, at the Company's request, any
full or fractional Designated Portfolio shares held by the Company on behalf of
the Account, such redemptions to be effected at net asset value in accordance
with Section 1.3 of this Agreement. Notwithstanding the foregoing, (i) the
Company shall not redeem Fund shares attributable to Contract owners except in
the circumstances permitted in Section 10.3 of this Agreement, and (ii) the Fund
may delay redemption of Fund shares of any Designated Portfolio to the extent
permitted by the Investment Company Act of 1940 as amended (the "1940 Act"), and
any rules, regulations or orders thereunder.
1.3. PURCHASE AND REDEMPTION PROCEDURES
(a) The Fund hereby appoints the Company as a limited
agent of the Fund for the limited purpose of receiving and accepting
purchase and redemption requests on behalf of the Account (but not with
respect to any Fund shares that may be held in the general account of
the Company) for shares of those Designated Portfolios made available
hereunder, based on allocations of amounts to the Account or subaccounts
thereof under the Contracts and other transactions relating to the
Contracts or the Account. Receipt and acceptance of any such request (or
relevant transactional information therefor) on any day the New York
Stock Exchange is open for trading and on which a Designated Portfolio
calculates its net asset value (a "Business Day") pursuant to the rules
of the Securities and Exchange Commission ("SEC") by the Company as such
limited agent of the Fund prior to the time that the Fund ordinarily
calculates its net asset value as described from time to time in the
Fund's prospectus (which as of the date of execution of this Agreement
is 4:00 p.m. Eastern Time) shall constitute receipt and acceptance by
the Designated Portfolio on that same Business Day, provided that the
Fund receives notice of such request by 8:30 a.m. Eastern Time on the
next following Business Day. However, to
facilitate the Designated Portfolios' daily trading practices, the Company shall
provide the Fund with "estimated trade" and other information relating to the
Designated Portfolios at certain times prior to the close of business on each
Business Day.
(b) The Company shall pay for shares of each Designated
Portfolio on the same day that it notifies the Fund of a purchase
request for such shares. Payment for Designated Portfolio shares shall
be made in federal funds transmitted to the Fund or other designated
person by wire to be received by 2:00 p.m. Eastern Time on the day the
Fund is notified of the purchase request for Designated Portfolio shares
(unless the Fund determines and so advises the Company that sufficient
proceeds are available from redemption of shares of other Designated
Portfolios effected pursuant to redemption requests tendered by the
Company on behalf of the Account). If federal funds are not received on
time, such funds will be invested, and Designated Portfolio shares
purchased thereby will be issued, as soon as practicable and the Company
shall promptly, upon the Fund's request, reimburse the Fund for any
charges, costs, fees, interest or other expenses incurred by the Fund in
connection with any advances to, or borrowing or overdrafts by, the
Fund, or any similar expenses incurred by the Fund, as a result of
portfolio transactions effected by the Fund based upon such purchase
request. Upon receipt of federal funds so wired, such funds shall cease
to be the responsibility of the Company and shall become the
responsibility of the Fund.
(c) Payment for Designated Portfolio shares redeemed by
the Account or the Company shall be made in federal funds transmitted by
wire to the Company or any other designated person on the next Business
Day after the Fund is properly notified of the redemption order of such
shares (unless redemption proceeds are to be applied to the purchase of
shares of other Designated Portfolio in accordance with Section 1.3(b)
of this Agreement), except that the Fund reserves the right to redeem
Designated Portfolio shares in assets other than cash and to delay
payment of redemption proceeds to the extent permitted under Section
22(e) of the 1940 Act and any Rules thereunder, and in accordance with
the procedures and policies of the Fund as described in the then current
prospectus. The Fund shall not bear any responsibility whatsoever for
the proper disbursement or crediting of redemption proceeds by the
Company, the Company alone shall be responsible for such action.
(d) Any purchase or redemption request for Designated
Portfolio shares held or to be held in the Company's general account
shall be effected at the net asset value per share next determined after
the Fund's receipt and acceptance of such request, provided that, in the
case of a purchase request, payment for Fund shares so requested is
received by the Fund in federal funds prior to close of business for
determination of such value, as defined from time to time in the Fund's
prospectus.
1.4. The Fund shall use its best efforts to make the net asset
value per share for each Designated Portfolio available to the Company by 6:30
p.m. Eastern Time each Business Day, and in any event, as soon as reasonably
practicable after the net asset value per share for such Designated Portfolio is
calculated, and shall calculate such net asset value in accordance with the
Fund's prospectus. Neither the Fund, any Designated Portfolio, the Distributor,
nor any of their affiliates shall be liable for any information provided to the
Company pursuant to this Agreement which information is based on incorrect
information supplied by the Company or any other Participating Insurance Company
to the Fund or the Distributor.
1.5. The Fund shall furnish notice (by wire or telephone
followed by written confirmation) to the Company as soon as reasonably
practicable of any income dividends or capital gain distributions payable on any
Designated Portfolio shares. The Company, on its behalf and on behalf of the
Account, hereby elects to receive all such dividends and distributions as are
payable on any Designated Portfolio shares in the form of additional shares of
that Designated Portfolio. The
Company reserves the right, on its behalf and on behalf of the Account, to
revoke this election and to receive all such dividends and capital gain
distributions in cash. The Fund shall notify the Company promptly of the number
of Designated Portfolio shares so issued as payment of such dividends and
distributions.
1.6. Issuance and transfer of Fund shares shall be by book entry
only. Share certificates will not be issued to the Company or the Account.
Purchase and redemption orders for Fund shares shall be recorded in an
appropriate ledger for the Account or the appropriate subaccount of the Account.
1.7. (a) The parties hereto acknowledge that the arrangement
contemplated by this Agreement is not exclusive; the Fund's shares may be sold
to other insurance companies (subject to Section 1.8 hereof) and the cash value
of the Contracts may be invested in other investment companies, provided,
however, that until this Agreement is terminated pursuant to Article X, the
Company shall promote the Designated Portfolios on the same basis as other
funding vehicles available under the Contracts. Funding vehicles other than
those listed on Schedule A to this Agreement may be available for the investment
of the cash value of the Contracts
(b) The Company shall not, without prior notice to the
Distributor (unless otherwise required by applicable law), take any action to
operate the Account as a management investment company under the 1940 Act.
(c) The Company shall not, without prior notice to the
Distributor (unless otherwise required by applicable law), induce Contract
owners to change or modify the Fund or change the Fund's investment adviser.
(d) The Company shall not, without prior notice to the
Fund, induce Contract owners to vote on any matter submitted for consideration
by the shareholders of the Fund in a manner other than as recommended by the
Board.
1.8. The Designated Portfolios shall sell their shares only to
Participating Insurance Companies and their separate accounts and to persons or
plans ("Qualified Persons") that communicate to the Fund that they qualify to
purchase shares of the Designated Portfolios under Section 817(h) of the
Internal Revenue Code of 1986, as amended (the "Code"), and the regulations
thereunder without impairing the ability of the Account to consider the
portfolio investments of the Fund as constituting investments of the Account for
the purpose of satisfying the diversification requirements of Section 817(h).
The Fund shall not sell shares of the Designated Portfolios to any insurance
company or separate account unless an agreement complying with Article VI of
this Agreement is in effect to govern such sales, to the extent required. The
Company hereby represents and warrants that it and the Account are Qualified
Persons. The Fund reserves the right to cease offering shares of any Designated
Portfolio in the discretion of the Fund.
ARTICLE II. REPRESENTATIONS AND WARRANTIES
2.1. The Company represents and warrants that the Contracts (a)
are, or prior to issuance will be, registered under the 1933 Act, or (b) are not
registered because they are properly exempt from registration under the 1933 Act
or will be offered exclusively in transactions that are properly exempt from
registration under the 1933 Act. The Company further represents and warrants
that the Contracts will be issued and sold in compliance in all material
respects with all applicable federal securities and state securities and
insurance laws and that the sale of the Contracts shall comply in all material
respects with state insurance suitability requirements. The Company further
represents
and warrants that it is an insurance company duly organized and in good standing
under applicable law, that it has legally and validly established the Account
prior to any issuance or sale thereof as a segregated asset account under
[State] insurance laws, and that it (a) has registered or, prior to any issuance
or sale of the Contracts, will register the Account as a unit investment trust
in accordance with the provisions of the 1940 Act to serve as a segregated
investment account for the Contracts, or alternatively (b) has not registered
the Account in proper reliance upon an exclusion from registration under the
1940 Act. The Company shall register and qualify the Contracts or interests
therein as securities in accordance with the laws of the various states only if
and to the extent deemed advisable by the Company.
2.2. The Fund represents and warrants that Designated Portfolios
shares sold pursuant to this Agreement shall be registered under the 1933 Act,
duly authorized for issuance and sold in compliance with applicable state and
federal securities laws and that the Fund is and shall remain registered under
the ▇▇▇▇ ▇▇▇. The Fund shall amend the registration statement for its shares
under the 1933 Act and the 1940 Act from time to time as required in order to
effect the continuous offering of its shares. The Fund shall register and
qualify the shares for sale in accordance with the laws of the various states
only if and to the extent deemed advisable by the Fund.
2.3. The Fund makes payments to finance distribution expenses
pursuant to Rule 12 b- I under the 1940 Act. The Fund's Board has formulated and
approved a plan pursuant to Rule 1 2b- 1 under the 1940 Act to finance
distribution expenses.
2.4. The Fund makes no representations as to whether any aspect
of its operations, including, but not limited to, investment policies, fees and
expenses, complies with the insurance and other applicable laws of the various
states but has no knowledge of any such deficiencies.
2.5. The Fund represents that it is lawfully organized and
validly existing under the laws of the State of Massachusetts and that it does
and will comply in all material respects with the 1940 Act.
2.6. The Distributor represents and warrants that it is
registered as a broker-dealer under the 1934 Act, and is a member in good
standing of the NASD.
2.7. The Fund and the Distributor represent and warrant that all
of their trustees/directors, officers, employees, and other individuals or
entities dealing with the money and/or securities of the Fund are and shall
continue to be at all times covered by a blanket fidelity bond or similar
coverage for the benefit of the Fund in an amount not less than the minimum
coverage as required currently by Rule 1 7g- 1 of the 1940 Act or related
provisions as may be promulgated from time to time. The aforesaid bond shall
include coverage for larceny and embezzlement and shall be issued by a reputable
bonding company.
2.8. The Company represents and warrants that all of its
directors, officers, employees, and other individuals/entities employed or
controlled by the Company dealing with the money and/or securities of the
Account are covered by a blanket fidelity bond or similar coverage for the
benefit of the Account, in an amount not less than $[dollar amount]. The
aforesaid bond includes coverage for larceny and embezzlement and is issued by a
reputable bonding company. The Company agrees to hold for the benefit of the
Fund and to pay to the Fund any amounts lost from larceny, embezzlement or other
events covered by the aforesaid bond to the extent such amounts properly belong
to the Fund pursuant to the terms of this Agreement. The Company agrees to make
all reasonable efforts to see that this bond or another bond containing these
provisions is always in effect,
and agrees to notify the Fund and the Distributor in the event that such
coverage no longer applies.
ARTICLE III. PROSPECTUSES AND PROXY STATEMENTS: VOTING
3.1. The Fund or its agent shall provide the Company with as
many copies of the Fund's current prospectus (describing only the Designated
Portfolios listed on Schedule A) or, to the extent permitted, the Fund's
profiles as the Company may reasonably request (including, if requested by
Company, electronically in .pdf format). The Company shall bear the expense of
printing copies of the current prospectus and profiles for the Contracts that
will be distributed to existing Contract owners, and the Company shall bear the
expense of printing copies of the Fund's prospectus and profiles that are used
in connection with offering the Contracts issued by the Company. If requested by
the Company in lieu thereof the Fund shall provide such documentation (including
a final copy of the new prospectus on diskette at the Fund's expense) and other
assistance as is reasonably necessary in order for the Company once each year
(or more frequently if the prospectus for the Fund is amended) to have the
prospectus for the Contracts and the Fund's prospectus or profile printed
together in one document (such printing to be at the Company's expense).
3.2. The Fund's prospectus shall state that the current
Statement of Additional Information ("SAT") for the Fund is available, and the
Fund, at its expense, shall provide a reasonable number of copies of such SAT
(including, if requested by Company, electronically in .pdf format) free of
charge to the Company for itself and for any owner of a Contract who requests
such SAI.
3.3. The Fund shall provide the Company with information
regarding the Fund's expenses, which information may include a table of fees and
related narrative disclosure for use in any prospectus or other descriptive
document relating to a Contract. The Company agrees that it will use such
information in the form provided. The Company shall provide prior written notice
of any proposed modification of such information, which notice will describe in
detail the manner in which the Company proposes to modify the information, and
agrees that it may not modify such information in any way without the prior
consent of the Fund. The Company shall provide notice to the Fund at least 10
days prior to the tiling or first use of any material subject to this paragraph
3.3.
3.4. The Fund, at its expense, shall provide the Company with
copies (including, if requested by Company, electronically in .pdf format) of
required reports to shareholders, and other communications to shareholders such
as any proxy that may be required in such quantity as the Company shall
reasonably require for distributing to Contract owners.
3.5. The Company shall:
(i) solicit voting instructions from Contract owners;
(ii) vote the Fund shares in accordance with
instructions received from Contract owners; and
(iii) vote Fund shares for which no instructions have
been received in the same proportion as Fund shares of such
portfolio for which instructions have been received,
so long as and to the extent that the SEC continues to interpret the 1940 Act to
require pass-through voting privileges for variable contract owners or to the
extent otherwise required by law. The Company will vote Fund shares held in any
segregated asset account in the same proportion as Fund shares of such
Designated Portfolio for which voting instructions have been received from
Contract owners, to the extent permitted by law.
3.6. Participating Insurance Companies shall be responsible for
assuring that each of their separate accounts participating in a Designated
Portfolio calculates voting privileges as required by the Mixed and Shared
Funding Exemptive Order (SEE Section 7.1) and consistent with any reasonable
standards that the Fund may adopt and provide in writing.
ARTICLE [V. SALES MATERIAL AND INFORMATION
4.1. The Company shall furnish, or shall cause to be furnished,
to the Fund or its designee, each piece of sales literature or other promotional
material that the Company develops and in which the Fund (or a Designated
Portfolio thereof) or the Distributor is named. No such material shall be used
until approved by the Fund or its designee, and the Fund will use its best
efforts for it or its designee to review such sales literature or promotional
material within ten Business Days after receipt of such material. The Fund or
its designee reserves the right to reasonably object to the continued use of any
such sales literature or other promotional material in which the Fund (or a
Designated Portfolio thereof) or the Distributor is named, and no such material
shall be used if the Fund or its designee so object.
4.2. The Company shall not give any information or make any
representations or statements on behalf of the Fund or concerning the Fund or
the Distributor in connection with the sale of the Contracts other than the
information or representations contained in the registration statement or
prospectus or SAI for the Fund shares, as such registration statement and
prospectus or SAI may be amended or supplemented from time to time, or in
reports or proxy statements for the Fund, or in sales literature or other
promotional material approved by the Fund or its designee, except with the
permission of the Fund or its designee.
4.3. The Fund and the Distributor, or their designee, shall
furnish, or cause to be furnished, to the Company, each piece of sales
literature or other promotional material that it develops and iii which the
Company, and/or its Account, is named. No such material shall be used until
approved by the Company, and the Company will use its best efforts to review
such sales literature or promotional material within ten Business Days after
receipt of such material. The Company reserves the right to reasonably object to
the continued use of any such sales literature or other promotional material in
which the Company and/or its Account is named, and no such material shall be
used if the Company so objects.
4.4. The Fund shall not give any information or make any
representations on behalf of the Company or concerning the Company, the Account,
or the Contracts other than the information or representations contained in a
registration statement, prospectus (which shall include an offering memorandum,
if any, if the Contracts issued by the Company or interests therein are not
registered under the 1933 Act), or SAI for the Contracts, as such registration
statement, prospectus, or SAI may be amended or supplemented from time to time,
or in published reports for the Account which are in the public domain or
approved by the Company for distribution to Contract owners, or in sales
literature or other promotional material approved by the Company or its
designee, except with the permission of the Company.
4.5. The Fund will provide (including, if requested by Company,
electronically in
..pdf format) to the Company at least one complete copy of all registration
statements, prospectuses, SAIs, reports, proxy statements, sales literature and
other promotional materials, applications for exemptions, requests for no-action
letters, and all amendments to any of the above, that relate to the Designated
Portfolios or their shares, promptly after the filing of such document(s) with
the SEC or other regulatory authorities.
4.6. The Company will provide to the Fund at least one complete
copy of all registration statements, prospectuses (which shall include an
offering memorandum, if any, if the Contracts issued by the Company or interests
therein are not registered under the 1933 Act), SAIs, reports, solicitations for
voting instructions, sales literature and other promotional materials,
applications for exemptions, requests for no-action letters, and all amendments
to any of the above, that relate to the Contracts or the Account, promptly after
the filing of such document(s) with the SEC or other regulatory authorities. The
Company shall provide to the Fund and the Distributor any complaints received
from the Contract owners pertaining to the Fund or a Designated Portfolio.
4.7. The Fund will provide the Company with as much notice as is
reasonably practicable of any proxy solicitation for any Designated Portfolio,
and of any material change in the Fund's registration statement, particularly
any change resulting in a change to the registration statement or prospectus for
any Account. The Fund will work with the Company so as to enable the Company to
solicit proxies from Contract owners, or to make changes to its prospectus or
registration statement, in an orderly manner. The Fund will make reasonable
efforts to attempt to have changes affecting Contract prospectuses become
effective simultaneously with the annual updates for such prospectuses.
4.8. For purposes of this Article IV, the phrase "sales
literature and other promotional materials" includes, but is not limited to, any
of the following that refer to the Fund, any Designated Portfolio or any
affiliate of the Fund: advertisements (such as material published, or designed
for use in, a newspaper, magazine, or other periodical, radio, television,
telephone or tape recording, videotape display, signs or billboards, motion
pictures, or other public media), sales literature (i.e., any written
communication distributed or made generally available to customers or the
public, including brochures, circulars, 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, and registration statements, prospectuses, SAIs, shareholder reports,
proxy materials, and any other communications distributed or made generally
available with regard to the Fund.
ARTICLE V. FEES AND EXPENSES
5.1. The Fund shall pay no fee or other compensation to the
Company under this Agreement, except that the Fund will make payments to the
Company or to the underwriter for the contracts pursuant to its Rule l2b-1 plan
to finance distribution expenses in amounts agreed to by the Fund.
5.2. All expenses incident to performance by the Fund under this
Agreement shall be paid by the Fund. The Fund shall see to it that all its
shares are registered and authorized for issuance in accordance with applicable
federal law and, if and to the extent deemed advisable by the Fund, in
accordance with applicable state laws prior to their sale. The Fund shall bear
the expenses for the cost of registration and qualification of the Fund's
shares, preparation and filing of the Fund's prospectus and registration
statement, proxy materials and reports, setting the prospectus in type, setting
in type and printing the proxy materials and reports to shareholders (including
the costs of printing a prospectus that
constitutes an annual report), the preparation of all statements and notices
required by any federal or state law, and all taxes on the issuance or transfer
of the Fund's shares.
5.3. The Company shall bear the expenses of distributing the
Fund's prospectus to owners of Contracts issued by the Company and of
distributing the Fund's proxy materials and reports to such Contract owners.
ARTICLE VI. DIVERSIFICATION AND QUALIFICATION
6.1. Subject to Company's representations and warranties in
Section 2.1 and 6.3, the Fund represents and warrants that it will invest its
assets in such a manner as to ensure that the Contracts will be treated as
annuity or life insurance contracts, whichever is appropriate, under the Code
and the regulations issued thereunder (or any successor provisions). Without
limiting the scope of the foregoing, each Designated Portfolio has complied and
will continue to comply with Section 817(h) of the Code and Treasury Regulation
Section 1 .817-5, and any Treasury interpretations thereof, relating to the
diversification requirements for variable annuity, endowment, or life insurance
contracts, and any amendments or other modifications or successor provisions to
such Section or Regulations. In the event of a breach of this Article VI by the
Fund, it will take all reasonable steps (a) to notify the Company of such breach
and (b) to adequately diversify the Fund so as to achieve compliance within the
grace period afforded by Treasury Regulation Section 1.817-5.
6.2. The Fund represents and warrants that it is or will be
qualified as a Regulated Investment Company under Subchapter M of the Code, and
that it will make every reasonable effort to maintain such qualification (under
Subchapter M or any successor or similar provisions) and that it will notify the
Company immediately upon having a reasonable basis for believing that it has
ceased to so qualify or that it might not so qualify in the future.
6.3. The Company represents and warrants that the Contracts are
currently, and at the time of issuance shall be, treated as life insurance or
annuity contracts, under applicable provisions of the Code, and that it will
make every effort to maintain such treatment, and that it will notify the Fund
and the Distributor immediately upon having a reasonable basis for believing the
Contracts have ceased to be so treated or that they might not be so treated in
the future. The Company agrees that any prospectus offering a contract that is a
"modified endowment contract" as that term is defined in Section 7702A of the
Code (or any. successor or similar provision), shall identify such contract as a
modified endowment Contract.
ARTICLE VII. POTENTIAL CONFLICTS
7.1. The Fund represents and warrants that it may rely on an
order that was granted by the SEC in Order Granting Exemptions; Conseco Series
Trust et al., Investment Company Act Rel. No.IC-23 736, March 10, 1999 granting
Participating Insurance Companies and variable annuity separate accounts and
variable life insurance separate accounts relief 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)(b)(15) thereunder, to the extent necessary to permit shares of the
Designated Portfolios to be sold to and held by variable annuity separate
accounts and variable life insurance separate accounts of both affiliated and
unaffiliated Participating
Insurance Companies, qualified pension and retirement plans outside of the
separate account context, and other permitted investors (the "Mixed and Share
Funding Order"). The parties to this Agreement agree that the conditions or
undertakings required by the Mixed and Shared Funding Order that may be imposed
on the Company, the Fund and/or the Distributor by virtue of such order by the
SEC: (i) shall apply only upon the sale of shares of the Designated Portfolios
to variable life insurance separate accounts (and then only to the extent
required under the 1940 Act); (ii) will be incorporated herein by reference; and
(iii) such parties agree to comply with such conditions and undertakings to the
extent applicable to each such party notwithstanding any provision of this
Agreement to the contrary.
7.2. The Board will monitor the Fund for the existence of any
material irreconcilable conflict between the interests of the Contract owners of
all separate accounts investing in the Fund. A material irreconcilable conflict
may arise for a variety of reasons, including: (a) an action by any state
insurance regulatory authority; (b) a change in applicable federal or state
insurance, tax, or securities laws or regulations, or a public ruling, private
letter ruling, no-action or interpretative letter, or any similar action by
insurance, tax, or securities regulatory authorities; (c) an administrative or
judicial decision in any relevant proceeding; (d) the manner in which the
investments of any Portfolio are being managed; (e) a difference in voting
instructions given by variable annuity contract and variable life insurance
contract owners; or (F) a decision by an insurer to disregard the voting
instructions of contract owners. The Board shall promptly inform the Company if
it determines that a material irreconcilable conflict exists and the
implications thereof.
7.3. The Company will report any potential or existing conflicts
of which it is aware to the Board. The Company will assist the Board in carrying
out its responsibilities under the Mixed and Shared Funding Exemptive Order, by
providing the Board with all information reasonably necessary for the Board to
consider any issues raised. This includes, but is not limited to, an obligation
by the Company to inform the Board whenever Contract owner voting instructions
are disregarded.
7.4. If it is determined by a majority of the Board, or a
majority of its disinterested members, that a material irreconcilable conflict
exists, the Company and other Participating Insurance Companies shall, at their
expense and to the extent reasonably practicable (as determined by a majority of
the disinterested Board members), take whatever steps are necessary to remedy or
eliminate the irreconcilable material conflict, up to and including: (1)
withdrawing the assets allocable to some or all of the separate accounts from
the Fund or any Portfolio and reinvesting such assets in a different investment
medium, including (but not limited to) another Portfolio of the Fund, or
submitting the question whether such segregation should be implemented to a vote
of all affected contract owners and, as appropriate, segregating the assets of
any appropriate group (i.e., annuity contract owners, life insurance contract
owners, or variable contract owners of one or more Participating Insurance
Companies) that votes in favor of such segregation, or offering to the affected
contract owners the option of making such a change; and (2) establishing a new
registered management investment company or managed separate account.
7.5. If a material irreconcilable conflict arises because of a
decision by the Company to disregard Contract owner voting instructions and that
decision represents a minority position or would preclude a majority vote, the
Company may be required, at the Fund's election, to withdraw the Account's
investment in the Fund and terminate this Agreement with respect to each
Account; provided, however, that such withdrawal and termination shall be
limited to the extent required by the foregoing material irreconcilable conflict
as determined by a majority of the disinterested members of the Board. Any such
withdrawal and termination must take place within six (6) months after the Fund
gives written notice that this provision is being implemented, and until the end
of that six month period the Fund shall continue to accept and implement orders
by the Company for the purchase (and redemption) of shares of the Fund.
7.6. If a material irreconcilable conflict arises because a
particular state insurance regulator's decision applicable to the Company
conflicts with the majority of other state regulators, then the Company will
withdraw the affected Account's investment in the Fund and terminate this
Agreement with respect to such Account within six months after the Board informs
the Company in writing that it has determined that such decision has created a
material irreconcilable conflict; provided, however, that such withdrawal and
termination shall be limited to the extent required by the foregoing material
irreconcilable conflict as determined by a majority of the disinterested members
of the Board. Until the end of the foregoing six month period, the Fund shall
continue to accept and implement orders by the Company for the purchase (and
redemption) of shares of the Fund.
7.7. For purposes of Section 7.4 through 7.7 of this Agreement,
a majority of the disinterested members of the Board shall determine whether any
proposed action adequately remedies any irreconcilable material conflict, but in
no event will the Fund be required to establish a new funding medium for the
Contracts. The Company shall not be required by Section 7.4 to establish a new
funding medium for the Contract if an offer to do so has been declined by vote
of a majority of Contract owners materially adversely affected by the material
irreconcilable conflict. In the event that the Board determines that any
proposed action does not adequately remedy any material irreconcilable conflict,
then the Company will withdraw the Account's investment in the Fund and
terminate this Agreement within six (6) months after the Board informs the
Company in writing of the foregoing determination; provided, however, that such
withdrawal and termination shall be limited to the extent required by any such
material irreconcilable conflict as determined by a majority of the
disinterested members of the Board.
7.8. If and to the extent that Rule 6e-2 and Rule 6e-3(T) are
amended, or Rule 6e-3 is adopted, to provide exemptive relief from any provision
of the 1940 Act or the rules promulgated thereunder with respect to mixed or
shared funding (as defined in the Mixed and Shared Funding Exemptive Order) on
terms and conditions materially different from those contained in the Mixed and
Shared Funding Exemptive Order, then (a) the Fund and/or the Participating
Insurance Companies, as appropriate, shall take such steps as may be necessary
to comply with Rules 6e-2 and 6e-3(T), as amended, and Rule 6e-3, as adopted, to
the extent such rules are applicable; and (b) Sections 3.5, 3.6, 7.2, 7.3, 7.4,
7.5, and 7.6 of this Agreement shall continue in effect only to the extent that
terms and conditions substantially identical to such Sections are contained in
such Rule(s) as so amended or adopted.
ARTICLE VIII. INDEMNIFICATION
8.1. INDEMNIFICATION BY THE COMPANY
8.1(a). The Company agrees to indemnify and hold harmless
the Fund and the Distributor and each of its trustees/directors and officers,
and each person, if any, who controls the Fund or Distributor within the meaning
of Section 15 of the 1933 Act or who is under common control with the
Distributor (collectively, the "Indemnified Parties" for purposes of this
Section 8.1) against any and all losses, claims, damages, liabilities (including
amounts paid in settlement with the written consent of the Company) or
litigation (including legal and other expenses), to which the Indemnified
Parties may become subject under any statute or regulation, at common law or
otherwise, insofar as such losses, claims, damages, liabilities or expenses (or
actions in respect thereof) or settlements:
(i) arise out of or are based upon any untrue
statement or alleged untrue statements of any material fact
contained in the registration
statement, prospectus (which shall include a written
description of a Contract that is not registered under the
1933 Act), or SAI for the Contracts or contained in the
Contracts or sales literature for the Contracts (or any
amendment or supplement to any of the foregoing), or arise
out of or are based upon the omission or the alleged
omission to state therein a material fact required to be
stated therein or necessary to make the statements therein
not misleading, provided that this 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
information furnished to the Company by or on behalf of the
Fund for use in the registration statement, prospectus or
SAT for the Contracts or in the Contracts or sales
literature (or any amendment or supplement) or otherwise
for use in connection with the sale of the Contracts or
Fund shares; or
(ii) arise out of or as a result of statements or
representations (other than statements or representations
contained in the registration statement, prospectus, SAT,
or sales literature of the Fund not supplied by the Company
or persons under its control) or wrongful conduct of the
Company or its agents or persons under the Company's
authorization or control, with respect to the sale or
distribution of the Contracts or Fund shares; or
(iii) arise out of any untrue statement or alleged
untrue statement of a material fact contained in a
registration statement, prospectus, SAT, or sales
literature of the Fund or any amendment thereof or
supplement thereto or the omission or alleged omission to
state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading
if such a statement or omission was made in reliance upon
information furnished to the Fund by or on behalf of the
Company; or
(iv) arise as a result of any material failure by the
Company to provide the services and furnish the materials
under the terms of this Agreement (including a failure,
whether unintentional or in good faith or otherwise, to
comply with the qualification requirements specified in
Article VI of this Agreement); or
(v) arise out of or result from any material breach of
any representation and/or warranty made by the Company in
this Agreement or arise out of or result from any other
material breach of this Agreement by the Company; as
limited by and in accordance with the provisions of
Sections 8.1(b) and 8.1(c) hereof.
8.1(b). The Company shall not be liable under this
indemnification provision with respect to any losses, claims, damages,
liabilities or litigation to which an Indemnified Party would otherwise be
subject by reason of such Indemnified party's willful misfeasance, bad faith, or
gross negligence in the performance of such Indemnified Party's duties or by
reason of such Indemnified Party's reckless disregard of its obligations or
duties under this Agreement.
8.1(c). The Company shall not be liable under this
indemnification provision with respect to any claim made against an Indemnified
Party unless such
Indemnified Party shall have notified the Company in writing within a reasonable
time after the summons or other first legal process giving information of the
nature of the claim shall have been served upon such Indemnified Party (or after
such Indemnified Party shall have received notice of such service on any
designated agent), but failure to notify the Company of any such claim shall not
relieve the Company from any liability which it may have to the Indemnified
Party against whom such action is brought otherwise than on account of this
indemnification provision. In case any such action is brought against an
Indemnified Party, the Company shall be entitled to participate, at its own
expense, in the defense of such action. The Company also shall be entitled to
assume the defense thereof, with counsel satisfactory to the party named in the
action. After notice from the Company to such party of the Company's election to
assume the defense thereof, the Indemnified Party shall bear the fees and
expenses of any additional counsel retained by it, and the Company will not be
liable to such party under this Agreement for any legal or other expenses
subsequently incurred by such party independently in connection with the defense
thereof other than reasonable costs of investigation.
8.1(d). The Indemnified Parties will promptly notify the
Company of the commencement of any litigation or proceedings against them in
connection with the issuance or sale of the Fund shares or the Contracts or the
operation of the Fund.
8.2. INDEMNIFICATION BY THE DISTRIBUTOR
8.2(a). The Distributor agrees to indemnify and hold
harmless the Company and each of its directors and officers and each person, if
any, who controls the Company within the meaning of Section 15 of the 1933 Act
(collectively, the "Indemnified Parties" for purposes of this Section 8.2)
against any and all losses, claims, damages, liabilities (including amounts paid
in settlement with the written consent of the Distributor) or litigation
(including legal and other expenses) to which the Indemnified Parties may become
subject under any statute or regulation, at common law or otherwise, insofar as
such losses, claims, damages, liabilities or expenses (or actions in respect
thereof) or settlements:
(i) arise out of or are based upon any untrue
statement or alleged untrue statement of any material fact
contained in the registration statement or prospectus or
SAT or sales literature 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
as to any Indemnified Party if such statement or omission
or such alleged statement or omission was made in reliance
upon and in conformity with information furnished to the
Distributor or Fund by or on behalf of the Company for use
in the registration statement, prospectus or SAT for the
Fund or in sales literature (or any
amendment or supplement) or otherwise for use in connection
with the sale of the Contracts or Fund shares; or
(ii) arise out of or as a result of statements or
representations (other than statements or representations
contained in the registration statement, prospectus, SAT or
sales literature for the Contracts not supplied by the Fund
or the Distributor) or wrongful conduct of the Fund or
Distributor with respect to the sale or distribution of the
Contracts or Fund shares; or
(iii) arise out of any untrue statement or alleged
untrue statement of a material fact contained in a
registration statement, prospectus, SAI or sales literature
covering the Contracts, or any amendment thereof or
supplement thereto, or the omission or alleged omission to
state therein a material fact required to be stated therein
or necessary to make the statement or statements therein
not misleading, if such statement or omission was made in
reliance upon information furnished to the Company by or on
behalf of the Fund or the Distributor; or
(iv) arise as a result of any failure by the Fund or
the Distributor to provide the services and furnish the
materials under the terms of this Agreement (including a
failure of the Fund, whether unintentional or in good faith
or otherwise, to comply with the diversification and other
qualification requirements specified in Article VI of this
Agreement); or
(v) arise out of or result from any material breach of
any representation and/or warranty made by the Distributor
in this Agreement or arise out of or result from any other
material breach of this Agreement by the Distributor; as
limited by and in accordance with the provisions of
Sections 8.2(b) and 8.2(c) hereof.
8.2(b). The Distributor shall not be liable under this
indemnification provision with respect to any losses, claims, damages,
liabilities or litigation to which an Indemnified Party would otherwise be
subject by reason of such Indemnified Party's willful misfeasance, bad faith, or
gross negligence in the performance or such Indemnified Party's duties or by
reason of such Indemnified Party's reckless disregard of obligations and duties
under this Agreement or to the Company or the Account, whichever is applicable.
8.2(c). The Distributor shall not be liable under this
indemnification provision with respect to any claim made against an Indemnified
Party unless such Indemnified Party shall have notified the Distributor in
writing within a reasonable time after the summons or other first legal process
giving information of the nature of the claim shall have been served upon such
Indemnified Party (or after such Indemnified Party shall have received notice of
such service on any designated agent), but failure to notify the Distributor of
any such claim shall not relieve the Distributor from any liability which it may
have to the Indemnified Party against whom such action is brought otherwise than
on account of this indemnification provision. In case any such action is brought
against the Indemnified Party, the Distributor will be entitled to participate,
at its own expense, in the defense thereof. The Distributor also shall be
entitled to assume the defense thereof, with counsel satisfactory to the party
named in the action. After notice from the Distributor to such party of the
Distributor's election to assume the defense thereof the Indemnified Party shall
bear the fees and expenses of any additional counsel retained by it, and the
Distributor will not be liable to such party under this Agreement for any legal
or other expenses subsequently incurred by such party independently in
connection with the defense thereof other than reasonable costs of
investigation.
8.2(d). The Company agrees promptly to notify the
Distributor of the
commencement of any litigation or proceedings against it or any of its officers
or directors in connection with the issuance or sale of the Contracts or the
operation of the Account.
8.3. INDEMNIFICATION BY THE FUND
8.3(a). The Fund agrees to indemnify and hold harmless the
Company and each of its directors and officers and each person, if any, who
controls the Company within the meaning of Section 15 of the 1933 Act
(collectively, the "Indemnified Parties" for purposes of this Section 8.3)
against any and all losses, claims, expenses, damages, liabilities (including
amounts paid in settlement with the written consent of the Fund) or litigation
(including legal and other expenses) to which the Indemnified Parties may be
required to pay or may become subject under any statute or regulation, at common
law or otherwise, insofar as such losses, claims, expenses, damages, liabilities
or expenses (or actions in respect thereof) or settlements, are related to the
operations of the Fund and:
(i) arise as a result of any failure by the Fund to
provide the services and furnish the materials under the
terms of this Agreement (including a failure, whether
unintentional or in good faith or otherwise, to comply with
the diversification and other qualification requirements
specified in Article VI of this Agreement); or
(ii) arise out of or result from 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;
as limited by and in accordance with the provisions of Sections 8.3(b) and
8.3(c) hereof.
8.3(b). The Fund shall not be liable under this
indemnification provision with respect to any losses, claims, damages,
liabilities or litigation to which an Indemnified Party would otherwise be
subject by reason of such Indemnified Party's willful misfeasance, bad faith, or
gross negligence in the performance of such Indemnified Party's duties or by
reason of such Indemnified Party's reckless disregard of obligations and duties
under this Agreement or to the Company, the Fund, the Distributor or the
Account, whichever is applicable.
8.3(c). The Fund shall not be liable under this
indemnification provision with respect to any claim made against an Indemnified
Party unless such Indemnified Party shall have notified the Fund in writing
within a reasonable time after the summons or other first legal process giving
information of the nature of the claim shall have been served upon such
Indemnified Party (or after such Indemnified Party shall have received notice of
such service on any designated agent), but failure to notify the Fund of any
such claim 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 indemnification provision. In case any such action is brought
against the Indemnified Parties, the Fund will be entitled to participate, at
its own expense, in the defense thereof The Fund also shall be entitled to
assume the defense thereof, with counsel satisfactory to the party named in the
action. After notice from the Fund to such party of the Fund's election to
assume the defense thereof, the Indemnified Party shall bear the fees and
expenses of any additional counsel retained by it, and the Fund will not be
liable to such party under this Agreement for any legal or other expenses
subsequently incurred by such party independently in connection with the defense
thereof other than reasonable costs of investigation.
8.3(d). The Company and the Distributor agree promptly to
notify the Fund of the commencement of any litigation or proceeding against it
or any of its respective officers or directors
in connection with the Agreement, the issuance or sale of the Contracts, the
operation of the Account, or the sale or acquisition of shares of the Fund.
ARTICLE IX. APPLICABLE LAW
9.1. This Agreement shall be construed and the provisions hereof
interpreted under and in accordance with the laws of the State of
Indiana.
9.2. This Agreement shall be subject to the provisions of the
1933, 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 Mixed and Shared Funding Exemptive
Order) and the terms hereof shall be interpreted and construed in accordance
therewith. If, in the future, the Mixed and Shared Funding Exemptive Order
should no longer be necessary under applicable law, then Article VII shall no
longer apply.
ARTICLE X. TERMINATION
10.1. This Agreement shall continue in full force and effect
until the first to occur of:
(a) termination by any party, for any reason with respect to
some or all Designated Portfolios, by three (3) months
advance written notice delivered to the other parties; or
(b) termination by the Company by written notice to the Fund
and the Distributor based upon the Company's determination
that shares of the Fund are not reasonably available to
meet the requirements of the Contracts; or
(c) termination by the Company by written notice to the Fund
and the Distributor in the event any of the Designated
Portfolio's shares are not registered, issued or sold in
accordance with applicable state and/or federal law or such
law precludes the use of such shares as the underlying
investment media of the Contracts issued or to be issued by
the Company; or
(d) termination by the Fund or Distributor in the event that
formal administrative proceedings are instituted against
the Company by the NASD, the SEC, the Insurance
Commissioner or like official of any state or any other
regulatory body regarding the Company's duties under this
Agreement or related to the sale of the Contracts, the
operation of any Account, or the purchase of the Designated
Portfolios' shares; provided, however, that the Fund or
Distributor determines in its sole judgment exercised in
good faith, that any such administrative proceedings will
have a material adverse effect upon the ability of the
Company to perform its obligations under this Agreement; or
(e) termination by the Company in the event that formal
administrative proceedings are instituted against the Fund
or Distributor by the SEC or any state securities or
insurance department or any other regulatory body;
provided, however, that the Company determines in its sole
judgment exercised in good faith, that any such
administrative proceedings will have a material adverse
effect upon the ability of the Fund or Distributor to
perform its obligations under this Agreement; or
(i) termination by the Company by written notice to the Fund
and the Distributor with respect to any Designated
Portfolio in the event that such Portfolio ceases to
qualify as a Regulated Investment Company under Subchapter
M or fails to comply with the Section 817(h)
diversification requirements specified in Article VI
hereof, or if the Company reasonably believes that such
Portfolio may fail to so qualify or comply; or
(g) termination by the Fund or Distributor by written notice to
the Company in the event that the Contracts fail to meet
the qualifications specified in Article VI hereof or
(h) termination by either the Fund or the Distributor by
written notice to the Company, if either one or both of the
Fund or the Distributor respectively, shall determine, in
their sole judgment exercised in good faith, that the
Company has suffered a material adverse change in its
business, operations, financial condition, or prospects
since the date of this Agreement or is the subject of
material adverse publicity; or
(i) termination by the Company by written notice to the Fund
and the Distributor, if the Company shall determine, in its
sole judgment exercised in good faith, that the Fund or the
Distributor 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) termination by the Fund or the Distributor by written
notice to the Company, if the Company gives the Fund and
the Distributor the written notice specified in Section 1.
7(a)(ii) hereof and at the time such notice was given there
was no notice of termination outstanding under any other
provision of this Agreement; provided, however, any
termination under this Section 10.1(j) shall be effective
forty-five days after the notice specified in Section
1.7(a)(ii) was given; or
(k) termination by the Company upon any substitution of the
shares of another investment company or series thereof for
shares of a Designated Portfolio of the Fund in accordance
with the terms of the Contracts, provided that the Company
has given at least 45 days prior written notice to the Fund
and Distributor of the date of substitution; or
(l) termination by any party in the event that the Board
determines that a material irreconcilable conflict exists
as provided in Article VII.
10.2. Notwithstanding any termination of this Agreement, the Fund
and the Distributor shall, at the option of the Company, continue to make
available additional shares of the Fund pursuant to the terms and conditions of
this Agreement, for all Contracts in effect on the effective date of termination
of this Agreement (hereinafter referred to as "Existing Contracts"), unless the
Distributor requests that the Company seek an order pursuant to Section 26(b) of
the 1940 Act to permit the substitution of other securities for the shares of
the Designated Portfolios. The Distributor agrees to split the cost of seeking
such an order, and the Company agrees that it shall reasonably cooperate with
the Distributor and seek such an order upon request. Specifically, the owners of
the Existing Contracts may be permitted to reallocate investments in the Fund,
redeem investments in the Fund and/or invest in the Fund upon the making of
additional purchase
payments under the Existing Contracts (subject to any such election by the
Distributor). The parties agree that this Section 10.2 shall not apply to any
terminations under Article VU and the effect of such Article VII terminations
shall be governed by Article VII of this Agreement. The parties further agree
that this Section 10.2 shall not apply to any terminations under Section 10.1(g)
of this Agreement.
10.3. The Company shall not redeem Fund shares attributable to
the Contracts (as opposed to Fund shares attributable to the Company's assets
held in the Account) except (i) as necessary to implement Contract owner
initiated or approved transactions, (ii) as required by state and/or federal
laws or regulations or judicial or other legal precedent of general application
(hereinafter referred to as a "Legally Required Redemption"), (iii) upon 45 days
prior written notice to the Fund and Distributor, as permitted by an order of
the SEC pursuant to Section 26(b) of the 1940 Act, but only if a substitution of
other securities for the shares of the Designated Portfolios is consistent with
the terms of the Contracts, or (iv) as permitted under the terms of the
Contract. Upon request, the Company will promptly furnish to the Fund and the
Distributor reasonable assurance that any redemption pursuant to clause (ii)
above is a Legally Required Redemption. Furthermore, except in cases where
permitted under the terms of the Contacts, the Company shall not prevent
Contract owners from allocating payments to a Portfolio that was otherwise
available under the Contracts without first giving the Fund or the Distributor
45 days notice of its intention to do so.
10.4. Notwithstanding any termination of this Agreement, each
party's obligation under Article VIII to indemnify the other parties shall
survive.
ARTICLE XI. NOTICES
Any notice shall be sufficiently given when sent by
registered or certified mail to the other party at the address of such party set
forth below or at such other address as such party may from time to time specify
in writing to the other party.
If to the Fund: Conseco Series Trust
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
If to Distributor: Conseco Equity Sales Inc.
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇▇▇▇▇▇
If to the Company: Conseco Variable Insurance Company
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇▇ ▇▇▇▇▇▇
ARTICLE XII. MISCELLANEOUS
12.1. All persons dealing with the Fund must look solely to the
property of the respective Designated Portfolios listed on Schedule A hereto as
though each such Designated Portfolio had separately contracted with the Company
and the Distributor for the enforcement of any claims against the Fund. The
parties agree that neither the Board, officers, agents or shareholders of the
Fund assume any personal liability or responsibility for obligations entered
into by or on behalf of the Fund.
12.2. Subject to the requirements of legal process and regulatory
authority, each party hereto shall treat as confidential the names and addresses
of the owners of the Contracts and all information reasonably identified as
confidential in writing by any other party hereto and, except as permitted by
this Agreement, shall not disclose, disseminate or utilize such names and
addresses and other confidential information without the express written consent
of the affected party until such time as such information has come into the
public domain.
12.3. The captions in this Agreement are included for convenience
of reference only and in no way define or delineate any of the provisions hereof
or otherwise affect their construction or effect.
12.4. This Agreement may be executed simultaneously in two or
more counterparts, each of which taken together shall constitute one and the
same instrument.
12.5. If any provision of this Agreement shall be held or made
invalid by a court decision, statute, rule or otherwise, the remainder of the
Agreement shall not be affected thereby.
12.6. Each party hereto shall cooperate with each other party and
all appropriate governmental authorities (including without limitation the SEC,
the NASD, and state insurance regulators) and shall permit such authorities
reasonable access to its books and records in connection with any investigation
or inquiry relating to this Agreement or the transactions contemplated hereby.
Notwithstanding the generality of the foregoing, each party hereto further
agrees to furnish the Texas Insurance Commissioner with any information or
reports in connection with services provided under this Agreement which such
commissioner may request in order to ascertain whether the variable insurance
operations of the Company are being conducted in a manner consistent with the
Texas insurance laws and regulations and any other applicable law or
regulations.
12.7. The rights, remedies and obligations contained in this
Agreement are cumulative and are in addition to any and all rights, remedies,
and obligations, at law or in equity, which the parties hereto are entitled to
under state and federal laws.
12.8. This Agreement or any of the rights and obligations
hereunder may not be assigned by any party without the prior written consent of
all parties hereto.
12.9. The Company shall furnish, or shall cause to be furnished,
to the Fund or its designee copies of the following reports:
(a) the Company's annual statement (prepared under statutory
accounting principles) and annual report (prepared under
generally accepted accounting principles) filed with any
state or federal regulatory body or otherwise made
available to the public, as soon as practicable and in any
event within 90 days after the end of each fiscal year; and
(b) any registration statement (without exhibits) and financial
reports of the Company filed with the Securities and
Exchange Commission or any state insurance regulatory, as
soon as practicable after the filing thereof.
IN WITNESS WHEREOF, each of the parties hereto has caused this in its
name and on its behalf by its duly authorized representative and its seal hereto
as of the date specified below.
Conseco Variable Insurance Company, a Texas Insurance Company:
By its authorized officer
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
--------------------
Title: General Counsel
Date:
CONSECO SERIES TRUST, A MASSACHUSETTS BUSINESS TRUST:
By its authorized officer
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
----------------------
Title: President
Date: 10/1/2002
CONSECO EQUITY SALES, INC., A TEXAS CORPORATION:
By its authorized officer
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
---------------------
Title: VP & Secretary
Date: 10/1/2002
SCHEDULE A
ACCOUNT(S)
Account C
Account E
Account F
Account G
Account H
Account I
Account L
CONTRACT
Account C INDIVIDUAL 22-402 5
Group 32-4000
Account E Achievement 22-4047 / 3 2-4003
Educator 22-4048/32-4002
Account F 22-4061
Account G 22-4056
Account H CVIC-2000 or CVIC-200 1 (varies by state)
Account I CVIC-2004 or CVIC-2005 (varies by state)
Account L CVIC-1001 and CVIC-1003
DESIGNATED PORTFOLIOS
Conseco 20 Focus Portfolio
Equity Portfolio
Balanced Portfolio
High Yield Portfolio
Fixed Income Portfolio
Government Securities Portfolio
Money Market Portfolio