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Exhibit 3
GENERAL AGENT AGREEMENT
THIS AGREEMENT, effective this _____ day of _________________, is made by and
among Nationwide Life Insurance Company, Nationwide Life and Annuity Insurance
Company, (collectively, "Nationwide") XXXXXXX & XXXX, INC. on its own behalf and
on behalf of its affiliated Corporate Insurance Agencies (Collectively referred
to as "Agency") and ("Broker/Dealer").
Nationwide hereby appoints Broker/Dealer and Agency (collectively, "General
Agent") as General Agent with the rights, powers, duties and liabilities set
forth herein. General Agent hereby accepts the appointment.
General Agent acknowledges, understands and agrees that although Nationwide Life
Insurance Company ("NWL") and Nationwide Life and Annuity Insurance Company
("NWLAIC") are collectively referred to herein as "Nationwide", NWL and NWLAIC
are separate corporate entities, and that the rights and obligations of each
under this Agreement are to be exclusively determined on the basis of which of
the two entities (NWL or NWLAIC) is the issuing company of the product(s)
specified in Exhibit A, and being sold pursuant to this Agreement.
Nationwide acknowledges, understands and agrees that although Broker/Dealer and
its affiliated Corporate insurance agencies are collectively, referred to herein
as "General Agent", Broker/Dealer and each of the Corporate insurance agencies
are separate corporate entities, and that the rights and obligations of each
under this Agreement are to be exclusively determined on the basis of which of
the entities is acting as agent with respect to the product(s) specified in
Exhibit A and being sold pursuant to this Agreement.
IN CONSIDERATION OF THE MUTUAL PROMISES HEREIN MADE, THE PARTIES AGREE AS
FOLLOWS:
1. SCOPE. This Agreement shall supersede the General Agent Agreement by and
between Nationwide Life Insurance Company, Nationwide Life and Annuity
Insurance Company, and Xxxxxxx & Xxxx, Inc. dated December 6, 1999, and
all other prior agreements between the parties, with respect to the
matters addressed herein. All of the insurance or annuity products sold
under this Agreement shall be referred to as "Contract(s)" except when
particular provisions relate solely to variable contracts required to be
registered under the Securities Act of 1933 ("1933 Act") and/or the
Investment Company Act of 1940 ("1940 Act") and such contracts shall be
referred to as "Variable Contracts". The Contracts which may be sold
under this Agreement are listed in the Compensation Schedules which are
included in Exhibit A. These Compensation Schedules may be amended upon
written agreement of Nationwide and General Agent.
In consideration of the services to be performed hereunder, Nationwide
agrees to pay General Agent compensation, in accordance with the
Exhibits to this Agreement, as may be amended from time to time by
mutual written agreement of the parties, based on purchase payments due
and received by Nationwide on Contracts issued upon applications
submitted either directly or through registered representatives and
agents, on or after the date of this Agreement.
2. EXCLUSIVITY. Except as otherwise provided herein, Nationwide will be the
exclusive provider to General Agent of the products specified in Exhibit
B for a period of five- (5) years. During this five- (5) year period,
General Agent will not
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offer any other competitor's products to their clients, except as
otherwise provided herein. Notwithstanding the foregoing, this
exclusivity provision will not apply to (a) clients transferring similar
investment products from one investment advisor and/or broker-dealer to
General Agent, but only to the extent of the transfer itself, (b)
products offered by General Agent's former affiliate, United Investors
Life Insurance Company, (c) additions made by General Agent clients to
products owned prior to the commencement of distribution of like
Nationwide products by General Agent pursuant to this agreement, (d)
sales made in New York prior to the development by Nationwide of
replacement products for sale in New York, and (e) sales made by new
General Agent financial advisors to prospects to which non-Nationwide
products were offered prior to their engagement by General Agent.
General Agent will make a good faith effort to monitor and report these
exceptions to ensure that the principle of overall exclusivity is
maintained.
Nationwide will provide sufficient resources to fulfill mutually agreed
upon product feature, support and service level standards. It is
understood and agreed that such exclusivity shall terminate at General
Agent's option if (a) Nationwide fails to meet the agreed upon product
feature, support and service standards and (b) Nationwide experiences a
change of control involving an unaffiliated organization. Nationwide may
also terminate its exclusive relationship with General Agent if General
Agent fails to meet its obligations as set forth herein.
Notwithstanding the foregoing, if General Agent experiences a change of
control involving an unaffiliated organization and such organization
desires for General Agent to sell its products or the products of one or
more of its affiliates ("Acquirer Products"), this exclusivity provision
will not apply to the Acquirer Products. It is understood and agreed
that if such a change of control should occur, and General Agent
commences offering Acquirer Products, General Agent shall use its best
efforts to insure that Nationwide's products receive and maintain an
equitable competitive position in General Agent's distribution system
throughout the exclusive period. For purposes of this provision, an
"equitable competitive position" shall mean, the opportunity for
Nationwide to provide products with substantially similar costs,
features commissions, fund diversification and positioning as the
Acquirer Products. In the event such a change of control occurs and
General Agent commences offering Acquirer Products, the exception from
this exclusivity provision identified in section (b) of the previous
paragraph, regarding a change of control at Nationwide involving an
unaffiliated organization, shall cease to apply.
3. AUTHORITY. Agency and Broker/Dealer are hereby authorized, through their
individual agents ("Agents"), representatives or duly licensed
affiliated agencies who are duly licensed and registered as required by
law, to solicit and procure applications for the Contracts in accordance
with the terms and conditions of this Agreement, and are authorized in
connection therewith:
a. to collect purchase payments on Contracts for which applications
are submitted;
b. when requested and as directed by Nationwide to deliver
Contracts after the terms and conditions governing such delivery
are completed, provided that no such delivery of a Contract
shall be deemed to constitute a warranty by General Agent that
such terms and conditions have been complied with;
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c. to perform any other act related to the Contracts that is
authorized in writing by Nationwide and is permissible under the
law; and
d. General Agent will pay all fees required to obtain and/or
maintain any licenses or registrations required by state or
federal law for General Agent and agents of General Agent.
Nationwide will pay the fees in connection with the initial
appointment with Nationwide of agents of General Agent. Any
subsequent appointment fees will be the responsibility of the
General Agent or as mutually agreed upon with Nationwide.
4. Right to Sell; Regulatory Approvals.
a. General Agent is authorized to sell the Contracts set forth in
the Compensation Schedule (Exhibit A) as now and hereafter
attached to this Agreement. The Compensation Schedule is hereby
incorporated by reference.
b. Except as disclosed to General Agent in writing, Nationwide
represents and warrants that it has the authority to issue
Contracts in the states where the General Agent is authorized to
conduct business. Nationwide agrees to notify General Agent
promptly of any change in such authority.
General Agent agrees that it will solicit applications for
Nationwide only in those states in which such Contracts are
approved.
c. General Agent will not solicit applications in any state unless
the Agent signing the application has been properly licensed by
the appropriate regulatory agency in that state, which may
include registrations as a registered representative of
Broker/Dealer if Variable Contracts are being sold. As a
licensed appointee of Nationwide, General Agent will comply with
the statutory and regulatory obligations related to the
solicitation and procurement of applications for Contracts.
d. If General Agent engages in sales of the Contracts on the
premises of or in cooperation with financial institutions
(including banks, savings and loan institutions, or credit
unions), General Agent shall, as required by applicable law,
maintain separation of its business from the business of such
financial institution, including separation of records. General
Agent shall also conduct its business at all times so as not to
lead to confusion between the business conducted by General
Agent and the business conducted by the financial institution.
The parties to the Agreement hereby agree to abide by, observe,
and otherwise conduct the business contemplated under the
Agreement in a manner consistent with the Guidelines set forth
in the Interagency Statement on Retail Sales of Non-Deposit
Investment Products, issued jointly by the Board of Governors of
the Federal Reserve System, the Federal Deposit Insurance
Corporation, the Office of the Comptroller of the Currency, and
the Office of Thrift Supervision on February 15, 1994, or any
modifications or interpretations thereof.
5. AGENT SUPERVISION
a. Before an Agent is permitted to solicit and procure applications
for the Contracts, General Agent and Agent shall have entered
into an agreement pursuant to which such Agent will be appointed
as an agent
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of General Agent and in which Agent will agree that Agent's
selling activities relating to the Contracts will be under the
supervision and control of General Agent. The Agent's right to
continue to sell the Contracts is subject to Agent's continued
compliance with such agreement.
b. If an Agent fails to meet the rules and standards imposed by
General Agent, General Agent shall take such disciplinary action
as it deems appropriate. If an Agent fails or refuses to submit
to supervision of General Agent in accordance with this
Agreement, General Agent shall immediately notify such Agent
that such Agent is no longer authorized to sell the Contracts
and shall take whatever additional action may be necessary to
terminate the sales activities of such Agent relating to the
Contracts including immediate notification to Nationwide of such
termination.
c. In the event that General Agent regards itself as exempt from
the licensing requirements of a state insurance authority, then
General Agent hereby warrants and guarantees that it shall
exercise supervisory control over the training and conduct of
its Agents in a manner consistent with state insurance
requirements with respect to fair, accurate and good faith
representations of product information in the solicitation
process, with due regard to the financial status of individual
consumers and the appropriateness of the Contract as an
investment for such individual consumers. Any intentional or
negligent failure in this regard, by any Agent of General Agent,
shall require General Agent to immediately terminate such
Agent's ability to sell the Contracts and to notify Nationwide
of such termination. In addition, General Agent will ensure that
its Agents comply with all applicable state insurance
requirements and have obtained and maintain any security
licenses required by the state insurance authorities.
6. SALE OF VARIABLE CONTRACTS.
a. General Agent agrees that each Agent who sells Variable
Contracts will be a registered representative of Broker/Dealer
(for purposes of this section, "Registered Representative") with
the National Association of Securities Dealers Inc. (the "NASD")
before the Agent engages in the offer and sale of Variable
Contracts. Broker/Dealer shall certify the status of each
Registered Representative's qualifications to Nationwide's
satisfaction and shall notify Nationwide if any such person
ceases to be a Registered Representative of Broker/Dealer.
b. Broker/Dealer shall have full responsibility for the training
and supervision of the Registered Representatives that offer and
sell the Variable Contracts. This training shall include
training in the sale of variable contracts. All Registered
Representatives shall be subject to the control of Broker/Dealer
in connection with the offer and sale of such Variable
Contracts.
c. Broker/Dealer will fully comply with the requirements of the
NASD, the Securities Exchange Act of 1934, and all other
applicable federal or state laws and will establish such rules
and procedures as may be necessary to cause diligent supervision
of the securities activities of the Registered Representatives.
Broker/Dealer shall furnish records necessary to document such
supervision at Nationwide's reasonable request.
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d. Before a Registered Representative is permitted to solicit and
procure applications for the Variable Contracts, Broker/Dealer
and the Registered Representative shall have entered into an
agreement pursuant to which the Registered Representative will
become a Registered Representative of Broker/Dealer and will
agree that their selling activities relating to the Variable
Contracts will be under the supervision and control of
Broker/Dealer. The right to continue to sell such Variable
Contracts is subject to continued compliance with such
agreement.
e. If a Registered Representative fails to meet the rules and
standards imposed by Broker/Dealer, Broker/Dealer shall take
such disciplinary action as it deems appropriate. If a
Registered Representative fails or refuses to submit to
supervision of Broker/Dealer in accordance with this Agreement,
Broker/Dealer shall immediately notify such Registered
Representative that he is no longer authorized to sell the
Variable Contracts, and Broker/Dealer shall take whatever
additional action may be necessary to terminate the sales
activities of such Registered Representative relating to the
Variable Contracts including immediate notification to
Nationwide of such termination.
f. Nationwide represents that (a) the Variable Contracts are
properly registered under the 1933 Act and/or 1940 Act and the
registration statements and the Variable Contracts will remain
in full force and effect for the duration of this Agreement, and
(b) the Variable Contracts are exempted or excepted from
registration under state securities laws. If any state should
amend its current securities laws to require registration of
insurance contracts, then Nationwide will comply with the
amended state law.
g. In connection with the conduct of its business, Broker/Dealer
shall be provided with prospectuses relating to the Variable
Contracts and such other material as Nationwide determines to be
necessary. Nationwide represents and warrants to Broker/Dealer
that all prospectuses and other material, which Nationwide makes
available to Broker/Dealer will comply in all respects with any
and all applicable federal and state securities laws.
7. INDEPENDENT CONTRACTOR.
General Agent is free to exercise its own judgment as to the persons
from whom it will solicit applications for Contracts as well as the
time, manner and place of solicitation, and Nationwide will not
unreasonably interfere with its activity or manner of performance under
this Agreement as an independent contractor.
Nothing contained in this Agreement shall create, or shall be construed
to create, the relationship of an employer and employee between
Nationwide and General Agent.
8. COLLECTION OF PURCHASE PAYMENTS.
All Contract purchase payments on applications procured by or through
General Agent, which General Agent may collect, are collected on behalf
of Nationwide. All purchase payments shall be in check or wire transfer.
All such monies received by General Agent shall be collected and
transmitted promptly to Nationwide in a manner agreed to by both General
Agent and Nationwide.
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9. LIMITATIONS ON AUTHORITY. Unless otherwise authorized by Nationwide in
writing pursuant to Section 3(c), General Agent shall have no authority
on behalf of Nationwide to:
a. make, alter or discharge any Contract,
b. incur any indebtedness or liability, expend or contract for the
expenditure of funds of Nationwide,
c. extend the time for payment of any purchase payment, bind
Nationwide to the reinstatement of any terminated Contract, or
accept notes for payment of purchase payments,
d. waive or modify any terms, conditions or limitations of any
Contract, adjust or settle any claim or commit Nationwide with
respect thereto except as provided in Section 13 c.,
e. enter into legal proceedings in connection with any matter
pertaining to Nationwide's business without the prior written
consent of Nationwide unless General Agent is named in such
proceedings or General Agent could be subject to paying all or a
part of any judgment. General Agent must immediately give
Nationwide written notification of the legal proceeding. Where
General Agent is either named or may be subject to paying all or
a portion of any judgment, General Agent may retain counsel of
its choice,
f. use the registered marks of Nationwide without receiving prior
written approval of Nationwide,
g. represent products of Nationwide except as reflected in the
prospectus,
h. advertise or publish any matter or thing concerning Nationwide
or the Contracts without the prior written permission of
Nationwide, except as provided in Section 14.a.,
i. open any bank account or trust account on behalf of, for the
benefit of, or containing the name of Nationwide,
j. directly or indirectly cause or endeavor to cause any General
Agent or their Agents to terminate or alter their association
with Nationwide, or will not advise or encourage any Nationwide
Contract Owner to relinquish, surrender, replace or lapse their
Nationwide contract unless such action is in the best interest
of the Contract Owner as reasonably determined by the General
Agent,
k. do or perform any acts or things other than expressly authorized
herein.
10. AGENTS.
a. General Agent shall select Agents subject to the provisions of
this Agreement and Nationwide shall appoint the selected Agents
or provide to General Agent in writing a reasonable basis for
not making such appointment. General Agent shall notify
Nationwide promptly, in writing, upon the giving or receipt of
any notice of termination of an Agent. General Agent will
provide Nationwide with any documentation necessary for the
appointment of the Agents. Nationwide reserves the right to
terminate the appointment of any Agent in its reasonable
discretion. Nationwide will promptly notify the General Agent of
the termination of the appointment of any Agent and the basis
therefor.
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b. At all times during which an Agent is appointed by Nationwide to
sell Contracts, General Agent shall ensure that each Agent has
obtained and maintains all applicable licenses in accordance
with applicable state and federal laws and regulations. General
Agent shall provide Nationwide on request evidence of applicable
insurance licenses of General Agent's Agents.
c. General Agent maintains the responsibility to ensure its Agents
comply with the terms of the Agreement.
11. COMPENSATION.
a. Nationwide agrees to pay General Agent compensation, in
accordance with the Compensation Schedules to this Agreement as
may be amended from time to time by mutual written agreement of
the parties.
b. Nationwide will pay all compensation due General Agent or any
Agents, either directly to General Agent or, as necessary to
meet legal requirements, to the licensed General Agent affiliate
or other affiliated entity which is permitted to receive such
compensation under applicable state law. In states where
corporate licenses are not granted, General Agent represents and
warrants that it or its affiliated entity has the necessary
relationship with the Agents based upon which such affiliated
entity is permitted to receive compensation under applicable
state insurance law except as otherwise approved by Nationwide.
General Agent hereby warrants that all necessary contractual
arrangements are in place to enable Nationwide to pay General
Agent, or any of its affiliates, for business produced by Agents
in the jurisdiction in which they hold licenses. General Agent
shall pay all compensation due to Agents or any other person
with respect to the Contracts, and no such Agent or other person
shall have any claim against Nationwide on account of the sale
or service of any Contract. Nationwide shall have no obligation
to make compensation payments except as provided above. If
Nationwide permits the General Agent to retain compensation
before remitting purchase payments, then the Net Compensation
Addendum shall specify that authority. Should Nationwide pay
General Agent for premiums later returned or credited to the
customer or any other overpayment to General Agent, Nationwide
shall have, in addition to all other creditor rights, the right
to deduct such overpayment from any current or future
compensation due General Agent.
c. All trail commissions, if any, shall be paid by Nationwide to
General Agent with respect to all Contracts sold by Agents on or
before the date of termination of this Agreement. In the event
Nationwide receives written authorization from an appointed
officer of the General Agent to transfer a Contract paying trail
commissions to a new General Agent, all subsequent trail
commissions as of the effective date of the transfer will be
paid to the new General Agent of record. In the event Nationwide
receives a written request from a contract owner to transfer a
contract to a new General Agent, all subsequent trail
commissions as of the effective date of the transfer will be
paid to the new General Agent of record. This paragraph shall
not be in derogation of any right of offset or other remedy
Nationwide may have on monies owed by General Agent or by the
new General Agent of record. General Agent agrees to maintain
any or all federal or state license and appointment including
any applicable renewal fees required, except to the extent
Nationwide is responsible therefor
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pursuant to this Agreement, in order to receive trail
commissions from Nationwide.
d. Notwithstanding any other provisions of this Agreement
Nationwide shall not be obligated to pay any compensation which
would be in violation of the applicable laws, rules or
regulations of any jurisdiction, subject to Section 13 of this
Agreement.
12. SEGREGATED BANK ACCOUNT.
All purchase payments received by General Agent on behalf of Nationwide,
including purchase payments received by General Agent from Agents, shall
be held in a segregated bank account and shall be forwarded to
Nationwide in accordance with mutually agreed upon instructions.
13. INDEMNIFICATION.
a. Nationwide agrees to indemnify and hold General Agent harmless
from any and all losses, claims, damages, liabilities or
expenses to which General Agent may become subject under any
statute, regulation, common law or otherwise, insofar as such
losses, claims, damages, liabilities or expenses relate directly
to the sale of the Contracts and arise as a direct consequence
of:
1) any material misrepresentation or omission, or alleged
misrepresentation or omission, contained in the
registration statement, prospectuses, the Contracts,
this Agreement or any other document prepared or
distributed by Nationwide including, but not limited to,
advertising or sales literature;
2) any failure by Nationwide or its employees, whether
negligent or intentional, to perform the duties and
discharge the obligations contemplated in this
Agreement; and
3) any fraudulent, unauthorized or wrongful act or omission
by Nationwide or its employees or agents.
b. General Agent agrees to indemnify and hold Nationwide harmless
from any and all losses, claims, damages, liabilities or
expenses to which Nationwide may become subject under any
statute, regulation, common law or otherwise, insofar as such
losses, claims, damages, liabilities or expenses related
directly to the sale of the Contracts and arise as a direct
consequence of:
1) any material misrepresentation or omission, or alleged
misrepresentation or omission involving the sales
contained within this Agreement provided that such
misrepresentations or omissions are not attributable to
any failure by Nationwide;
2) any failure by General Agent or its employees or Agents,
whether negligent or intentional, to perform the duties
and discharge the obligations contemplated in this
agreement; and
3) any fraudulent, unauthorized or wrongful act or omission
by General Agent or its employees or Agents.
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c. In the event that Nationwide is compelled or agrees to pay any
amount in the settlement of any claim, judgment, arbitration or
similar action and, in conjunction therewith, General Agent
voluntarily agrees to reimburse Nationwide, either partially or
totally, Nationwide may deduct the amount of the reimbursement
from any sales compensation subsequently payable to General
Agent. Nothing herein shall obligate General Agent to provide
any such voluntary reimbursement.
d. Neither Nationwide or General Agent shall be liable, as the
indemnifying party pursuant to Sections 13a and 13b, if the
losses, claims, damages, liabilities or legal expenses incurred
by the indemnified party arise out of the indemnified party's
willful misfeasance, bad faith, or gross negligence in the
performance of its duties, or through the reckless disregard of
the indemnified party's duties under this Agreement.
e. Nationwide and General Agent will promptly notify each other of
the commencement of any litigation or proceedings, or the
assertion of any claim or any material inquiries related to the
duties set forth in the Agreement.
f. This indemnification shall be in addition to any other course of
action Nationwide or General Agent may have.
14. AGREEMENTS.
a. All advertising material and sales promotional material
published by General Agent or its Agents that specifically name
Nationwide or reference the Contracts shall be and remain the
sole and exclusive property of General Agent and shall be used
solely and exclusively by General Agent and its Agents. Such
material shall be submitted to Nationwide for its approval prior
to its use by General Agent or Agents. Nationwide shall provide
its approval in writing. Such material shall not be used by
Nationwide or its other agents without prior written consent of
General Agent.
b. Nationwide and General Agent shall keep thorough and correct
records, books, and accounts on all transactions arising out of
this Agreement, and shall preserve and hold all documents,
correspondence and records relating to Contracts which come into
its possession or under its control. All such books or accounts,
documents, correspondence and records of each party pertaining
to or used by it in connection with its operations hereunder
shall belong to it, and at all times shall be open to inspection
by any officer or duly authorized representative of the other
party.
c. In the course of normal customer servicing of existing Contracts
or if required by law, Nationwide may contact by mail or
otherwise any client, agent, account executive, or employee of
General Agent or other individual acting in a similar capacity
if deemed appropriate by Nationwide.
d. Each party agrees to promptly notify the others in writing of
any written customer complaint or notice of regulatory
investigation it receives which may involve the others.
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e. Each party represents and warrants that the entering into and
performance of this Agreement does not and will not conflict
with or cause a breach of any other agreement to which any of
them is a party.
f. Each party represents and warrants that it has full power and
authority to enter into this Agreement and to carry out its
duties and obligations hereunder.
g. Agency represents and warrants that it has the authority to
execute this Agreement on its own behalf and on behalf of any of
its affiliated agencies providing the services set forth in this
Agreement in order for General Agent to meet all applicable
legal requirements. All the necessary arrangements are in place
to bind Agency's affiliated agencies to the terms and conditions
of this Agreement.
15. TERMINATION.
a. Each party may terminate this Agreement for cause at any time,
without prior written notice, if another party (1) fails to
comply with the laws or regulations of any state or other
governmental agency or body having jurisdiction over the sale of
insurance or securities, (2) misappropriates any money or
property belonging to another party, (3) subjects an other party
to any actual or potential liability due to misfeasance,
malfeasance, or nonfeasance, (4) commits any fraud upon another
party, (5) has an assignment for the benefit of creditors, (6)
incurs bankruptcy, or (7) commits a material breach of this
Agreement.
b. Nationwide may terminate the relationship and any obligations
set forth herein if Xxxxxxx & Xxxx experiences a change of
control, if said change of control materially alters General
Agent's ability to perform its obligations under this agreement.
c. This Agreement may be terminated by a party upon six months
written notice to the other parties.
16. MISCELLANEOUS PROVISIONS.
a. General Agent may assign or pledge any rights under this
Agreement with Nationwide's prior written consent.
b. The forbearance or neglect of Nationwide, Broker/Dealer or
Agency to insist upon strict compliance by a party, with any of
the provisions of this Agreement, whether continuing or not, or
to declare a forfeiture of termination against that party, shall
not be construed as a waiver of any of the rights or privileges
of the parties. No waiver of any right or privilege of
Nationwide, Broker/Dealer or Agency arising from any default or
failure of performance by a party shall affect the rights or
privileges of the other parties in the event of a further
default or failure of performance.
c. Communications sent pursuant to provisions of this item shall be
in writing and shall be delivered personally or sent by U.S.
mail or commercial courier:
If to Nationwide: Nationwide Life Insurance
Company and/ or
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Nationwide Life and Annuity
Insurance Company
Xxx Xxxxxxxxxx Xxxxx
Xxxxxxxx, XX 00000
Attn: Vice President,
Individual Annuity Operations
If to General Agent: Xxxxxxx & Xxxx, Inc.
Attn: Legal Department
0000 Xxxxx Xxxxxx
Xxxxxxxx Xxxx, XX 00000
Any party may change its address by so notifying the other parties in
writing. Any notice shall be deemed given only upon receipt by the party
to be notified.
d. Except as otherwise provided in this Agreement, this Agreement
may not be amended or modified except by a written Agreement
executed by the parties.
e. This Agreement (including Amendments and Compensation Schedules)
constitutes the entire agreement between the parties and
supersedes all prior agreements, understandings and
arrangements, oral and written, between the parties with respect
to the subject matter hereof.
f. This Agreement shall be binding upon the parties and their
respective successors and assigns.
g. This Agreement shall be governed and construed in accordance
with the laws of the State of Ohio.
h. In case any provision in this Agreement shall be invalid,
illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not be affected
or impaired.
i. The paragraph headings are for reference purposes only and shall
not be deemed to be a part of this Agreement or to affect the
meaning or interpretation of the Agreement.
j. This Agreement may be executed in any number of counterparts,
each of which shall be deemed to be an original instrument and
all of which together shall be deemed to be one and the same
instrument.
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IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the date
first above written.
XXXXXXX & XXXX, INC. NATIONWIDE LIFE INSURANCE
COMPANY
on it's own behalf and on the behalf
of its affiliated Corporate Agencies NATIONWIDE LIFE AND ANNUITY
(General Agent) INSURANCE COMPANY
By: By:
--------------------------------- -------------------------------
Title: Title:
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EXHIBIT A
COMPENSATION SCHEDULE
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Effective Date:
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This is the Compensation Schedule for the General Agent Agreement between
Nationwide and General Agent.
1. Nationwide shall pay General Agent compensation computed on the premiums
or purchase payments paid to, received and accepted by Nationwide on
contract applications procured by General Agent in accordance with this
Agreement, and at the rates set forth in this schedule and all
amendments attached hereto.
2. Unless otherwise provided in an applicable Net Compensation Addendum,
nothing herein shall be construed as giving General Agent the right to
withhold or net such compensation from premium or purchase payments it
shall receive.
3. Except as otherwise provided in this Agreement, Nationwide will prepare
a compensation statement for periods ending on the 7th, 15th, 22nd and
the last business day of each month and shall deliver the statement, and
any compensation due there under, to General Agent within 5 business
days of the end of such period for the following products: Xxxxxxx &
Xxxx Advisors Select Life, Xxxxxxx & Xxxx Advisors Survivorship Life,
Xxxxxxx & Xxxx Advisors Term One/Ten/Twenty and Xxxxxxx & Xxxx Advisors
Term Ten/Twenty-NY.
The billing cycle for compensation associated with the Xxxxxxx & Xxxx
Advisors Retirement Plan product, is the 1st day of the month through
the 15th day and the 16th day through the last business day of the
month.
The compensation cycle for the following products will be daily:
Xxxxxxx & Xxxx Advisor Select Annuity
Xxxxxxx & Xxxx Advisors Select Plus Annuity
Xxxxxxx & Xxxx Advisors Select Plus Annuity NY
4. The compensation rates which shall apply to business produced by General
Agent pursuant to this Agreement are attached to this Exhibit as one or
more Compensation Schedules, which may be amended from time to time as
provided for in this Agreement. The Compensation Schedules also apply to
all state specific versions of the contract form numbers listed on the
Compensation Schedules.
Some of the Contracts listed in the Compensation Schedules may not be
available for sale in all states. General Agent is responsible for
ascertaining whether it has the authority, pursuant to state and federal
law, to sell the Contracts in the jurisdictions in which the Contracts
have been approved and in which General Agent is appointed by
Nationwide.
5. No compensation shall be payable, and Nationwide may chargeback any
compensation that may have been paid in any of the following situations:
(i) Nationwide, in its good faith discretion, determines not to issue
the Contract applied for; (ii) Nationwide refunds the premiums or
purchase payments upon the applicant's surrender or withdrawal pursuant
to any "free-look" privilege; (iii) Nationwide refunds the premiums paid
as a result of a complaint by the Contract holder or applicant; or (iv)
Nationwide determines that any person soliciting an application was
required to be licensed and was not or that any other person or entity
receiving compensation for soliciting application or premiums for the
Contracts is not or was not duly licensed as an insurance agent and
appointed (v) if Nationwide determines at any time that the applicant
did not meet applicable underwriting standards, including but not
limited to, the maximum issue age.
6. Compensations or replacements or conversions shall be allowed in
accordance with the Company rules in force at the time such replacement
or conversion is effected.
7. Nationwide will not pay compensation on an internal exchange unless
otherwise provided in this Agreement.
THIS EXHIBIT ESTABLISHES THE COMPENSATION RATES FOR PURCHASE PAYMENTS SPECIFIED
HEREIN AND IN NO WAY SUPERSEDES OR REVOKES ANY OTHER TERMS IN THE AGREEMENT. ALL
OTHER PROVISIONS OF THE AGREEMENT ARE UNAFFECTED BY THIS EXHIBIT.
13
14
COMPENSATION SCHEDULE
FOR
XXXXXXX & XXXX ADVISORS SELECT ANNUITY(SM)
Issued by Nationwide Life and Annuity Insurance Company
Xxxxxxx & Xxxx Advisors Select Annuity(SM) FHL 661 or FHL 686
(includes non-qualified, XXX, SEP XXX, SIMPLE XXX,
Spousal XXX, Xxxx XXX, 401(a) investment only, CRT,
ORP, and non-ERISA 403(b))
NEW MONEY SCHEDULE UPFRONT TRAIL OPTION TRAIL OPTION TRAIL OPTION TRAIL OPTION
OPTION/NO TRAIL * #1 #2 #3 #4
Annuitant Age Compensation Compensation Compensation Compensation Compensation
Rate Rate Rate Rate Rate
0 - 80 7.75% 6.25% 5.75% 4.50% 2.95%
81 - 85 3.90% 3.10% 2.90% 2.25% 1.50%
86 - 90 3.10% 2.50% 2.30% 1.80% 1.20%
Quarterly Trail
Compensation
Beginning 5th Calendar
Quarter: 0.00% 0.25% 0.32% 0.50% 0.75%
* NOTE: UNLESS OTHERWISE ELECTED BY THE AGENT OF GENERAL AGENT, UPFRONT
OPTION WILL BE THE AUTOMATIC COMPENSATION OPTION.
Trail compensation is computed at the end of each calendar quarter beginning
with the quarter specified above. Trail compensation is computed by multiplying
assets times trail percentage divided by 4.
ADDITIONAL CHARGEBACK PROVISIONS for the Xxxxxxx & Xxxx Advisors Select
Annuity(SM) Contracts:
In the event that any Contract issued under this Agreement experiences a
withdrawal, compensation paid on amounts which are subject to Contingent
Deferred Sales Charges will be charged back to the General Agent within the
first 6 months from the date of issue, the full compensation paid thereon shall
be charged back.
INTERNAL EXCHANGES to the Xxxxxxx & Xxxx Advisors Select Annuity(SM) Contracts:
1) INTERNAL EXCHANGES FROM ANY NATIONWIDE LIFE INSURANCE COMPANY AND
NATIONWIDE LIFE AND ANNUITY INSURANCE COMPANY FIXED AND VARIABLE ANNUITY
CONTRACTS EXCEPT CONTRACTS SPECIFIED BELOW:
INTERNAL EXCHANGE SCHEDULE * UPFRONT TRAIL OPTION #1 TRAIL OPTION #2 TRAIL OPTION #3 **
OPTION/NO TRAIL
Annuitant Age Compensation Rate Compensation Rate Compensation Rate Compensation Rate
0 - 80 3.90% 2.40% 1.90% 0.65%
81 - 85 1.95% 1.20% 0.95% 0.30%
86 - 90 1.55% 0.95% 0.75% 0.25%
Quarterly Trail Compensation
Beginning 5th Calendar
Quarter:
0.00% 0.25% 0.32% 0.50%
* NOTE: FOR SUBSEQUENT PAYMENTS RECEIVED INTO THE EXCHANGED
POLICY, COMPENSATION WILL BE PAID USING THE NEW MONEY GRID
LISTED ABOVE.
** NOTE: UNLESS OTHERWISE ELECTED BY THE AGENT OF GENERAL
AGENT, TRAIL OPTION #3 WILL BE THE AUTOMATIC COMPENSATION
OPTION.
Trail compensation is computed at the end of each calendar quarter
beginning with the quarter specified above. Trail compensation is
computed by multiplying assets times trail percentage divided by 4.
14
15
2) INTERNAL EXCHANGES FROM ANY XXXXXXX & XXXX ADVISORS VARIABLE ANNUITY: Full
CDSC will be assessed, (or if the contract is outside of the CDSC period)
no chargebacks will be applied on any previous compensation paid on the
original Contract and no compensation paid on the Internal Exchange.
3) INTERNAL EXCHANGES FROM ANY FIDELITY ADVISOR PRODUCT CONTRACT: Full CDSC
will be assessed (or if the contract is outside of the CDSC period), no
chargebacks will be applied on any previous compensation paid on the
original Contract and no compensation paid on the Internal Exchange.
4) INTERNAL EXCHANGES FROM THE BEST OF AMERICA(R) GROUP PENSIONS SERIES
CONTRACT: If the Upfront Compensation Option is elected, the compensation
shall be reduced in the amount equal to the amount of the Contingent
Deferred Sales Charge waived by Nationwide on The Best of America(R) Group
Pensions Series contract ("Waived CDSC Amount"). The Trail Compensation
Options (#1, 2, 3 and 4) may only be elected when the Total Payout Rate
("Upfront Compensation") is equal to or greater than the Waived CDSC
Amount. Where the Trail Compensation Options can be elected, the amount of
the Upfront Compensation shall be reduced by the Waived CDSC Amount.
Standard compensation rates shall apply to internal exchanges from the Best
of America(R) Group Pension Series contracts.
15
16
COMPENSATION SCHEDULE
FOR
XXXXXXX & XXXX ADVISORS SELECT PLUS ANNUITY(SM)
Issued by Nationwide Life and Annuity Insurance Company
Xxxxxxx & Xxxx Advisors Select PlusAnnuity(SM) FHL 677 or FHL 688
(includes non-qualified, XXX, SEP XXX, SIMPLE XXX,
Spousal XXX, Xxxx XXX, 401(a) investment only, CRT,
ORP, and non-ERISA 403(b))
UPFRONT OPTION/NO TRAIL * TRAIL OPTION #1
Annuitant Age Compensation Rate Compensation Rate
0 - 80 5.55% 3.80%
81 - 85 2.80% 1.90%
86 - 90 2.20% 1.50%
Quarterly Trail Compensation
Beginning 5th Calendar
Quarter: 0.00% 0.25%
* NOTE: UNLESS OTHERWISE ELECTED BY THE AGENT OF GENERAL AGENT, UPFRONT OPTION
WILL BE THE AUTOMATIC COMPENSATION OPTION FOR BUSINESS WITH NEW MONEY.
Trail compensation is computed at the end of each calendar quarter beginning
with the quarter specified above. Trail compensation is computed by multiplying
assets times trail percentage divided by 4.
ADDITIONAL CHARGEBACK PROVISIONS for the Xxxxxxx & Xxxx Advisors Select Plus
Annuity(SM) Contracts:
In the event that any Contract issued under this Agreement experiences a
withdrawal, compensation paid on amounts which are subject to Contingent
Deferred Sales Charges will be charged back to the General Agent within the
first 6 months from the date of issue, the full compensation paid thereon shall
be charged back.
INTERNAL EXCHANGES to the Xxxxxxx & Xxxx Advisors Select Plus Annuity(SM)
Contracts:
1) INTERNAL EXCHANGES FROM ANY NATIONWIDE LIFE INSURANCE COMPANY AND
NATIONWIDE LIFE AND ANNUITY INSURANCE COMPANY FIXED OR VARIABLE ANNUITY
CONTRACTS EXCEPT CONTRACTS SPECIFIED BELOW:: Full CDSC will be assessed,
(or if the contract is outside of the CDSC period) no chargebacks will be
applied on any previous compensation paid on the original Contract and no
compensation paid on the Internal Exchange.
2) INTERNAL EXCHANGES FROM ANY XXXXXXX & XXXX ADVISORS VARIABLE ANNUITY: Full
CDSC will be assessed, (or if the contract is outside of the CDSC period)
no chargebacks will be applied on any previous compensation paid on the
original Contract and no compensation paid on the Internal Exchange.
3) INTERNAL EXCHANGES FROM ANY FIDELITY ADVISOR PRODUCT CONTRACT: Full CDSC
will be assessed, (or if the contract is outside of the CDSC period) no
chargebacks will be applied on any previous compensation paid on the
original Contract and no compensation paid on the Internal Exchange.
4) INTERNAL EXCHANGES FROM THE BEST OF AMERICA(R) GROUP PENSIONS SERIES
CONTRACT: If the Upfront Compensation Option is elected, the compensation
shall be reduced in the amount equal to the amount of the Contingent
Deferred Sales Charge waived by Nationwide on The Best of America(R) Group
Pensions Series contract ("Waived CDSC Amount"). The Trail Compensation
Options #1 may only be elected when the Total Payout Rate ("Upfront
Compensation") is equal to or greater than the Waived CDSC Amount. Where
the Trail Compensation Options can be elected, the amount of the Upfront
Compensation shall be reduced by the Waived CDSC Amount. Standard
compensation rates shall apply to internal exchanges from the Best of
America(R) Group Pension Series.
16
17
COMPENSATION SCHEDULE
FOR
XXXXXXX & XXXX ADVISORS SELECT PLUS ANNUITY - NY(SM)
Issued by Nationwide Life Insurance Company
Xxxxxxx & Xxxx Advisors Select Plus Annuity - NY(SM) APO 4502-32A
(includes non-qualified, XXX, SEP XXX, SIMPLE XXX,
Spousal XXX, Xxxx XXX, 401(a) investment only, CRT,
ORP, and non-ERISA 403(b))
The following options will apply in New York ONLY.
NEW MONEY UPFRONT OPTION/NO TRAIL UPFRONT OPTION/NO TRAIL
SCHEDULE OPTION #1* OPTION #2
Annuitant Age Compensation Rate Compensation Rate
0 - 75 5.52% 4.02%
76 - 80 4.70% 3.40%
81 - 85 2.75% 2.00%
* NOTE: UNLESS OTHERWISE ELECTED BY THE AGENT OF GENERAL AGENT, UPFRONT OPTION
#1 WILL BE THE AUTOMATIC COMPENSATION OPTION FOR BUSINESS WITH NEW
MONEY.
ADDITIONAL CHARGEBACK PROVISIONS for the Xxxxxxx & Xxxx Advisors Select Plus
Annuity - NY(SM) Contracts:
In the event that any Contract issued under this Agreement experiences a
withdrawal, compensation paid on amounts which are subject to Contingent
Deferred Sales Charges will be charged back to the General Agent within the
first 12 months from the date of issue, the full compensation paid thereon shall
be charged back.
INTERNAL EXCHANGES to the Xxxxxxx & Xxxx Advisors Select Annuity(SM) Contracts:
1) INTERNAL EXCHANGES FROM ANY NATIONWIDE LIFE INSURANCE COMPANY AND
NATIONWIDE LIFE AND ANNUITY INSURANCE COMPANY FIXED AND VARIABLE ANNUITY
CONTRACTS EXCEPT CONTRACTS SPECIFIED BELOW:
The following options will apply in New York ONLY.
INTERNAL EXCHANGE UPFRONT OPTION/NO TRAIL UPFRONT OPTION/NO TRAIL
SCHEDULE OPTION #1 OPTION #2 *
Annuitant Age Compensation Rate Compensation Rate
0 - 75 2.75% 2.00%
76 - 80 2.25% 1.70%
81 - 85 1.40% 1.00%
* NOTE: FOR SUBSEQUENT PAYMENTS RECEIVED INTO THE EXCHANGED POLICY,
COMPENSATION WILL BE PAID USING THE NEW MONEY GRID LISTED ABOVE.
** NOTE: UNLESS OTHERWISE ELECTED BY THE AGENT OF GENERAL AGENT, UPFRONT OPTION
#2 WILL BE THE AUTOMATIC COMPENSATION OPTION FOR INTERNAL EXCHANGES.
2) INTERNAL EXCHANGES FROM ANY XXXXXXX & XXXX ADVISORS VARIABLE ANNUITY: Full
CDSC will be assessed, (or if the contract is outside of the CDSC period)
no chargebacks will be applied on any previous compensation paid on the
original Contract and no compensation paid on the Internal Exchange.
3) INTERNAL EXCHANGES FROM ANY FIDELITY ADVISOR PRODUCT CONTRACT: Full CDSC
will be assessed, (or if the contract is outside of the CDSC period) no
chargebacks will be applied on any previous compensation paid on the
original Contract and no compensation paid on the Internal Exchange.
4) INTERNAL EXCHANGES FROM THE BEST OF AMERICA(R) GROUP PENSIONS SERIES
CONTRACT: If the Upfront Compensation Option is elected, the compensation
shall be reduced in the amount equal to the amount of the Contingent
Deferred Sales Charge waived by Nationwide on The Best of America(R) Group
Pensions Series contract ("Waived CDSC Amount"). Standard compensation
rates shall apply to internal exchanges from The Best of America(R) Group
Pension Series.
17
18
COMPENSATION SCHEDULE
FOR
FLEXIBLE PREMIUM VARIABLE UNIVERSAL LIFE
XXXXXXX & XXXX ADVISORS SELECT LIFE
Issued by Nationwide Life Insurance Company
FOR POLICIES ISSUED UNDER CONTRACT FORM VLO 510:
============================================================== ===============================================================
CONTRACTS CONTRACT NUMBER
-------------------------------------------------------------- ---------------------------------------------------------------
Xxxxxxx and Xxxx
Flexible Premium Variable Universal Life VLO 510
Advisors Select Life
-------------------------------------------------------------- ---------------------------------------------------------------
PREMIUM BASED COMPENSATION
For all ages and all underwriting classes:
Year 1: Compensation is 60% of premium up to compensation target
premium plus 5% of any premium over compensation
target premium.
Years 2 - 10 Compensation is 3 % of premium received in that year.
Years 11 + Compensation is 2 % of premium received in that year.
-------------------------------------------------------------- ---------------------------------------------------------------
Compensation is based on the relationship between premiums (received and
accepted) and the target premium of the policy in question. Target Premiums vary
by type of product, type of rider, insured's issue age, sex, specified amount
and the underwriting risk classification.
COMPENSATION ON INCREASES IN COVERAGE: Compensation for an increase in coverage
will be paid at the rate of 60% of the lessor of 1) the amount of premiums paid
in the 12 months following an increase, and 2) target premium following the
increase less the previous target premium. Compensation on premiums in excess of
the target premium following the increase less the previous target premium will
be 5% of such premiums. No EAP is paid for increases in coverage.
EXPENSE ALLOWANCE PAYMENT: All Expense Allowance Payments (EAP) will be paid as
earned and are separate from and in addition to the compensation rates stated
above.
For each FLEXIBLE PREMIUM VARIABLE UNIVERSAL LIFE policy issued (excluding any
policies issued as internal replacements), Nationwide will pay to the General
Agent expense reimbursements calculated as the product of : 1) EAP percentage;
and 2) the lessor of : a) actual first year premiums paid up to the Target
Premium, b) 75% of the corresponding Guideline Annual Premium, or c) planned
renewal premium requested by the owner in the application for insurance; where,
EAP Percentage = 15%
Nothing in this Agreement shall be construed as giving the General Agent the
right to withhold or deduct an Expense Allowance Payment from premium it shall
receive.
The General Agent agrees that no payment will be used by the agent or General
Agent to effect compensation in excess of the limits of Section 4228 of the New
York Insurance Laws. In the event overpayment is made to the General Agent by
Nationwide, because life compensation payments together with expense allowance
payments exceed applicable limits of Section 4228 of the New York Insurance Law,
such overpayment shall be charged against and deducted from future compensation
due to the General Agent by Nationwide until paid in full. Nationwide will not
knowingly permit to be paid, by any payor, payments in excess of this Plan.
EAP CHARGEBACKS: In the event a variable life insurance policy shall terminate
within twelve months from the date of issue, 100% of the EAP shall be charged
back against the General Agent.
CHARGEBACKS: In the event a variable life insurance policy shall terminate
within six months from the date of issue, the full compensation paid thereon
shall be charged back against the General Agent. In the event a termination
takes place after the sixth and before the thirteenth month after the date of
issue, fifty percent of the compensation will be charged back against the
General Agent.
18
19
CHARGEBACK ON FIRST YEAR LOANS: Loans taken in the first year will result in a
partial charge back of commission and EAP. Loans are considered a reduction of
premiums in excess of commission target premium, and secondly a reduction of
premiums paid up to target.
The charge back of the commissions earned on premiums paid in excess of target
is calculated as:
Zero, if premiums paid have not exceeded target;
or A times B times C divided by D, if premiums paid have exceeded the
commission target premium. Where:
A equals the lesser of the amount of the loan and the premiums paid
in excess of target.
B equals 100% for loans taken in months 1 through 6 and 50% for
loans taken in months 7 through 12,
C equals the amount of commission paid on premiums received in
excess of target, and
D equals the premiums paid in excess of target.
The charge back of the commissions earned on premiums paid up to excess of
target is calculated as:
A times B times C divided by D, where:
A equals the greater of 0 (zero), and the lesser of amount of the
loan and the amount of the loan plus the target premium less the
premiums paid,
B equals 100% for loans taken in the months 1 through 6 and 50% for
loans taken in months 7 through 12,
C equals the amount of commission paid on premiums up to target,
and
D equals the lesser of the premiums paid and the commission target
premium.
The charge back of the EAP is calculated as :
A times B times C divided by D, where:
A equals the greater of 0 (zero), and the lesser of amount of the
loan and the amount of loan plus the target premium less the
premiums paid,
B equals 100%
C equals the amount of EAP earned, and
D equals the lesser of the premiums paid and the commission target
premium.
In the event that a loan taken in the first year on which the above chargeback
provision applies is repaid within the first policy year, the amount of the
chargeback attributed to the amount of the loan repayment will be paid as
compensation. Loan repayments will first be considered repayment of target
premiums, and secondly repayment of premiums in excess of target.
THE CHARGE BACK OF INCREASE COMMISSION DUE TO LOANS OR WITHDRAWALS TAKEN WITHIN
ONE YEAR OF INCREASE:
The charge back of the commissions earned on increases is calculated as:
The charge back of the commissions earned on premiums paid in excess of new
target less the previous target is calculated as:
Zero, if premiums paid have not exceeded new target less the previous
target;
or A times B times C divided by D, if premiums paid have exceeded the
new target less the previous
target. Where:
A equals the lesser of the amount of the loan and/or withdrawal and
the premiums paid in excess of new target less the previous target.
B equals 100% for loans and/or withdrawals taken in months 1
through 6 following the increase and 50% for loans taken in months
7 through 12 following the increase,
C equals the amount of commission paid on premiums received in
excess of target, and
D equals the premiums paid in excess of target
19
20
The charge back of the commissions earned on premiums paid up to the new target
less the previous target is calculated as:
Zero, if no premiums have been paid within 12 months following the
increase.
A times B times C divided by D, where:
A equals the greater of 0 (zero) and the lesser (1) and (2), where
(1) equals new target less the prior target, and
(2) equals the amount of the loan or withdrawal,
B equals 100% for loans or withdrawals taken in the months 1
through 6 following the increase and 50% for loans or withdrawals
taken months 7 through 12 following the increase,
C equals the amount of commission paid on premiums received up to
the new target less the previous target, and
D equals the lesser of the premiums paid within 12 months following
the increase and the new target less the prior target premium.
20
21
COMPENSATION SCHEDULE
FOR
LAST SURVIVOR
FLEXIBLE PREMIUM VARIABLE UNIVERSAL LIFE
XXXXXXX & XXXX ADVISORS SURVIVORSHIP LIFE
Issued by Nationwide Life Insurance Company
FOR POLICIES ISSUED UNDER CONTRACT FORM VLO 600:
============================================================== ===============================================================
CONTRACTS CONTRACT NUMBER
-------------------------------------------------------------- ---------------------------------------------------------------
Xxxxxxx and Xxxx
Last Survivor Flexible Premium Variable Universal Life VLO 600
Advisors Survivorship Life
-------------------------------------------------------------- ---------------------------------------------------------------
PREMIUM BASED COMPENSATION
For all ages and all underwriting classes:
Year 1: Compensation is 60% of premium up to compensation
target premium plus 5% of any premium over
compensation target premium.
Years 2 - 10 Compensation is 3 % of premium received in that year.
Years 11 + Compensation is 2 % of premium received in that year.
-------------------------------------------------------------- ---------------------------------------------------------------
Compensation is based on the relationship between premiums (received and
accepted) and the target premium of the policy in question. Target Premiums vary
by type of product, type of rider, insured's issue age, sex, specified amount
and the underwriting risk classification.
COMPENSATION ON INCREASES IN COVERAGE: Compensation for an increase in coverage
will be paid at the rate of 60% of the lessor of 1) the amount of premiums paid
in the 12 months following an increase, and 2) target premium following the
increase less the previous target premium. Compensation on premiums in excess of
the target premium following the increase less the previous target premium will
be 5% of such premiums. No EAP is paid for increases in coverage
EXPENSE ALLOWANCE PAYMENT: All Expense Allowance Payments (EAP) will be paid as
earned and are separate from and in addition to the compensation rates stated
above.
For each LAST SURVIVOR FLEXIBLE PREMIUM VARIABLE UNIVERSAL LIFE policy issued
(excluding any policies issued as internal replacements), Nationwide will pay to
the General Agent expense reimbursements calculated as the product of : 1) EAP
percentage; and 2) the lessor of : a) actual first year premiums paid up to the
Target Premium, b) 75% of the corresponding Guideline Annual Premium, or c)
planned renewal premium requested by the owner in the application for insurance;
where,
EAP Percentage = 15%
Nothing in this Agreement shall be construed as giving the General Agent the
right to withhold or deduct an Expense Allowance Payment from premium it shall
receive.
The General Agent agrees that no payment will be used by the agent or General
Agent to effect compensation in excess of the limits of Section 4228 of the New
York Insurance Laws. In the event overpayment is made to the General Agent by
Nationwide, because life compensation payments together with expense allowance
payments exceed applicable limits of Section 4228 of the New York Insurance Law,
such overpayment shall be charged against and deducted from future compensation
due to the General Agent by Nationwide until paid in full. Nationwide will not
knowingly permit to be paid, by any payor, payments in excess of this Plan.
EAP CHARGEBACKS: In the event a variable life insurance policy shall terminate
within twelve months from the date of issue, 100% of the EAP shall be charged
back against the General Agent.
CHARGEBACKS: In the event a variable life insurance policy shall terminate
within six months from the date of issue, the full compensation paid thereon
shall be charged back against the General Agent. In
21
22
the event a termination takes place after the sixth and before the thirteenth
month after the date of issue, fifty percent of the compensation will be charged
back against the General Agent.
CHARGEBACK ON FIRST YEAR LOANS: Loans taken in the first year will result in a
partial charge back of commission and EAP. Loans are considered a reduction of
premiums in excess of commission target premium, and secondly a reduction of
premiums paid up to target.
The charge back of the commissions earned on premiums paid in excess of target
is calculated as:
Zero, if premiums paid have not exceeded target;
or A times B times C divided by D, if premiums paid have exceeded the
commission target premium. Where:
A equals the lesser of the amount of the loan and the premiums paid
in excess of target.
B equals 100% for loans taken in months 1 through 6 and 50% for
loans taken in months 7 through 12,
C equals the amount of commission paid on premiums received in
excess of target, and
D equals the premiums paid in excess of target.
The charge back of the commissions earned on premiums paid up to excess of
target is calculated as:
A times B times C divided by D, where:
A equals the greater of 0 (zero), and the lesser of amount of the
loan and the amount of the loan plus the target premium less the
premiums paid,
B equals 100% for loans taken in the months 1 through 6 and 50% for
loans taken in months 7 through 12,
C equals the amount of commission paid on premiums up to target,
and
D equals the lesser of the premiums paid and the commission target
premium.
The charge back of the EAP is calculated as :
A times B times C divided by D, where:
A equals the greater of 0 (zero), and the lesser of amount of the
loan and the amount of loan plus the target premium less the
premiums paid,
B equals 100%
C equals the amount of EAP earned, and
D equals the lesser of the premiums paid and the commission target
premium.
In the event that a loan taken in the first year on which the above chargeback
provision applies is repaid within the first policy year, the amount of the
chargeback attributed to the amount of the loan repayment will be paid as
compensation. Loan repayments will first be considered repayment of target
premiums, and secondly repayment of premiums in excess of target.
THE CHARGE BACK OF INCREASE COMMISSION DUE TO LOANS OR WITHDRAWALS TAKEN WITHIN
ONE YEAR OF INCREASE:
The charge back of the commissions earned on premiums paid in excess of new
target less the previous target is calculated as:
Zero, if premiums paid have not exceeded new target less the previous
target;
or A times B times C divided by D, if premiums paid have exceeded the
new target less the previous target. Where:
A equals the lesser of the amount of the loan and/or withdrawal and
the premiums paid in excess of new target less the previous target.
B equals 100% for loans and/or withdrawals taken in months 1
through 6 following the increase and 50% for loans taken in months
7 through 12 following the increase,
C equals the amount of commission paid on premiums received in
excess of target, and
D equals the premiums paid in excess of target
22
23
The charge back of the commissions earned on premiums paid up to the new target
less the previous target is calculated as:
Zero, if no premiums have been paid within 12 months following the
increase.
A times B times C divided by D, where:
A equals the greater of 0 (zero) and the lesser (1) and (2), where
(1) equals new target less the prior target, and
(2) equals the amount of the loan or withdrawal,
B equals 100% for loans or withdrawals taken in the months 1
through 6 following the increase and 50% for loans or withdrawals
taken months 7 through 12 following the increase,
C equals the amount of commission paid on premiums received up to
the new target less the previous target, and
D equals the lesser of the premiums paid within 12 months following
the increase and the new target less the prior target premium.
In the event that a loan taken within one year of increase on which the above
chargeback provision applies is repaid within one year of the increase policy
year, the amount of the chargeback attributed to the amount of the loan
repayment will be paid as compensation. Loan repayments will first be considered
repayment of the increase in target premium, and secondly repayment of premiums
in excess of the new target.
CHARGEBACK ON REDUCTIONS DURING THE FIRST FOUR YEARS; OR WITHIN THE FIRST 48
MONTHS FOLLOWING AN INCREASE IN COVERAGE: Reductions in the specified amount
during the first four years or within 48 months following an increase will
result in a chargeback of commission and EAP.
The chargeback of the commission and EAP earned on premiums paid in the first
policy year is calculated as:
For reductions in year 1: 100% of the first year commission and EAP
paid on the amount of the reduction (if applicable - the contract does
not allow first year reductions)
For reductions in year 2: 75% of the first year commission and EAP paid
on the amount of the reduction.
For reductions in year 3: 50% of the first year commission and EAP paid
on the amount of the reduction.
For reductions in year 4: 25% of the first year commission and EAP
paid on the amount of the reduction.
For reductions in year 5 or later, no chargeback will apply.
All chargeback rules previously stated will apply.
23
24
COMPENSATION SCHEDULE
FOR
XXXXXXX & XXXX ADVISORS TERM ONE/TEN/TWENTY (SM)
XXXXXXX & XXXX ADVISORS TERM TEN/TWENTY - NY(SM)
Issued by Nationwide Life Insurance Company
Effective Date: January 10, 2000
----------------
This is an amendment to the Exhibit A, Compensation Schedule, of the General
Agent Agreement, between Nationwide Life Insurance Company and the General
Agent.
THEREFORE, Exhibit A, Compensation Schedule, is amended as follows:
===========================================================================================================================
CONTRACTS CONTRACT NUMBER
---------------------------------------------------------------------------------------------------------------------------
Xxxxxxx & Xxxx Advisors Term One/Ten/Twenty(SM)
VLO 428
---------------------------------------------------------------------------------------------------------------------------
COMPENSATION
For all ages and all underwriting classes:
---------------------------------------------------------------------------------------------------------------------------
Year 1: Compensation is 60% of premium less policy fee.
---------------------------------------------------------------------------------------------------------------------------
Years 2 + Compensation is 3% of premium received in that year less
policy fee.
---------------------------------------------------------------------------------------------------------------------------
EXPENSE ALLOWANCE PAYMENT: All Expense Allowance Payments (EAP) will be paid as
earned and are separate from and in addition to the compensation rates stated
above.
For each PRO-TERM SERIES policy issued (excluding any policies issued as
internal replacements), Nationwide will pay to the General Agent expense
reimbursements based on first year paid premiums calculated as the product of :
1) EAP Percentage and 2) Premiums less policy Fee; where,
EAP Percentage = 20.00%
Nothing in this Agreement shall be construed as giving the General Agent the
right to withhold or deduct an Expense Allowance Payment from premium it shall
receive.
The General Agent agrees that no payment will be used by the agent or General
Agent to effect compensation in excess of the limits of Section 4228 of the New
York Insurance Laws. In the event overpayment is made to the General Agent by
Nationwide, because life compensation payments together with expense allowance
payments exceed applicable limits of Section 4228 of the New York Insurance Law,
such overpayment shall be charged against and deducted from future compensation
due to the General Agent by Nationwide until paid in full. Nationwide will not
knowingly permit to be paid, by any payor, payments in excess of this Plan.
EAP CHARGEBACKS: In the event a Xxxxxxx & Xxxx Advisors Term One/Ten/Twenty(SM)
life insurance policy shall terminate within twelve months from the date of
issue, 100% of the EAP shall be charged back against the General Agent. In the
event a termination takes place after the twelfth month and before the
twenty-fifth month after the date of issue, fifty percent of the EAP shall be
charged back against the General Agent.
CHARGEBACKS: In the event a Xxxxxxx & Xxxx Advisors Term One/Ten/Twenty(SM) life
insurance policy shall terminate within twelve months from the date of issue,
the full compensation paid thereon shall be charged back against the General
Agent. In the event a termination takes place after the twelfth and before the
twenty-fifth month after the date of issue, fifty percent of the first year
compensation will be charged back against the General Agent. Charge backs may be
applied against current and future compensation payable.
UNEARNED PREMIUM CHARGEBACKS: In the event a Xxxxxxx & Xxxx Advisors Term
One/Ten/Twenty(SM) contract terminates after the twelfth month after the date of
issue, 100% of the compensation paid on Unearned Premium will be charged back
against the General Agent. Unearned
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Premium is premium paid which is not yet due. Unearned Premiums are returned to
the policyholder upon life insurance policy termination.
This amendment also applies to state-specific versions of these contract form
numbers.
All other provisions of the existing General Agent Agreement, as amended remain
in effect.
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EXHIBIT B
EXCLUSIVITY
Nationwide will be the exclusive provider to Xxxxxxx & Xxxx for the following
products:
1. Xxxxxxx & Xxxx Advisor Select Annuity
2. Xxxxxxx & Xxxx Advisors Select Plus Annuity
3. Xxxxxxx & Xxxx Advisors Select Plus Annuity NY
4. Xxxxxxx & Xxxx Advisors Select Life
5. Xxxxxxx & Xxxx Advisors Retirement Plan
There will be no Exclusivity Arrangement regarding the following products:
1. Xxxxxxx & Xxxx Advisors Survivorship Life
2. Xxxxxxx & Xxxx Advisors Term Ten/Twenty
3. Xxxxxxx & Xxxx Advisors Term Ten/Twenty NY
Upon the mutual agreement of both parties, this EXHIBIT may be amended from time
to time with the addition of certain other annuity or insurance products.
*Actual form numbers to be used in certain states may have different identifying
suffixes, which reflect certain unique characteristics of the contract mandated
by the particular state insurance authority.
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ADDENDUM TO THE
GENERAL AGENT AGREEMENT
SINGLE COMPENSATION PAYMENT
Effective date _____________________
This is an addendum to the General Agent Agreement among Nationwide Life
Insurance Company, Nationwide Life and Annuity Insurance Company and Xxxxxxx &
Xxxx, Inc., on its own behalf and on behalf of its affiliated Corporate
Insurance Agencies (Collectively referred to as "Agency") and ("Broker/Dealer").
Nationwide will send a single compensation payment to General Agent in a
mutually acceptable manner. Such compensation payment shall be net of
chargebacks and any other charges owed by General Agent. Nationwide will provide
General Agent with Compensation Statements providing descriptions of the
compensation earned by agent. General Agent represents and warrants that it has
all necessary contractual arrangements in place to receive such payment on
behalf of the individual entities and agents, that it will forward all
commissions to the properly licensed and appointed insurance agencies and/or
agents, and that it will comply with applicable law in its handling of such
commissions.
Notwithstanding any other provisions to this General Agent Agreement, Nationwide
shall not be obligated to pay any compensation which would be in violation of
applicable laws, rules or regulations of any jurisdiction.
Nationwide reserves the right to terminate this arrangement at its discretion
with proper notice to all parties. All of the other provisions of the existing
General Agent Agreement, as amended, shall remain in effect.
XXXXXXX & XXXX, INC. NATIONWIDE LIFE INSURANCE
(General Agent) COMPANY
on it's own behalf and on the
behalf of its affiliated Corporate NATIONWIDE LIFE AND ANNUITY
Agencies INSURANCE COMPANY
By: _______________________________ By:_____________________________
Title: ____________________________ Title: Vice President
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APPOINTMENT BACKGROUND INVESTIGATION ADDENDUM TO
GENERAL AGENT AGREEMENT
Effective Date _______________
This Appointment Background Investigation Addendum is incorporated into the
General Agent's Agreement in effect among Nationwide Life Insurance Company and
Nationwide Life and Annuity Insurance Company, and XXXXXXX & XXXX, INC. on its
own behalf and on behalf of its affiliated Corporate Insurance Agencies
(Collectively referred to as "Agency") and ("Broker/Dealer") collectively
referred to as "General Agent".
General Agent will conduct a thorough background investigation on each of its
Registered Representatives. In addition to the information obtained by your
branch managers during the interview process, the following reviews are
conducted by your Home Office staff as part of the registration, licensing and
appointment process:
1. PREHIRES: A check of the Central Registration Depository is completed for
any individual who has been previously employed in the securities industry.
The information obtained includes employment, residential exam and
disclosure history, fingerprint/arrest information and registration status.
2. FINGERPRINTING: A fingerprint card is submitted to the NASD for all
employees and independent contractors. A review of arrest records both
disclosed by the applicant or reported by the NASD is required for bonding
consideration.
3. COURT CHECK: Outside reporting agencies are used to conduct court record
searches. Situations identified by this process are reviewed and documented
to determine any judgments, liens and/or bankruptcies.
Any adverse information is reviewed with appropriate management personnel within
the firm and additional inquiries are made where appropriate.
Nationwide has reviewed General Agent's current employment screening process and
deems that these guidelines meet Nationwide's screening standard.
General Agent agrees to:
1. promptly provide Nationwide detailed background information on any agent
appointed or persons nominated for appointment when necessary to comply
with state insurance regulations or when investigating a consumer or
government entity complaint, audit, market conduct exam or other inquiries;
and,
2. notify Nationwide in advance of any changes in their background
requirements.
3. immediately notify Nationwide in writing of any material changes which
affect the qualifications of an agent or agency for appointment and/or
licenses under applicable state law.
General Agent represents and warrants that the agents for whom it requests
appointment or license sponsorship from Nationwide meets the applicable state
licensing and appointment requirements.
Nationwide reserves the right to modify their appointment and background
investigation standards and practices at any time and will notify General Agent
prior to implementation.
XXXXXXX & XXXX, INC. NATIONWIDE LIFE INSURANCE
COMPANY
ON IT'S OWN BEHALF AND ON THE
BEHALF OF ITS AFFILIATED CORPORATE NATIONWIDE LIFE AND ANNUITY
AGENCIES INSURANCE COMPANY
By: _______________________________ By: ________________________________
Print Name: _______________________ Print Name: ________________________
Title: ____________________________ Title: _____________________________
Date: _____________________________ Date: ______________________________
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