EXHIBIT 1.A.3(A)
MASTER SERVICE AND DISTRIBUTION COMPLIANCE AGREEMENT
BETWEEN DEPOSITOR AND PHOENIX EQUITY PLANNING CORPORATION
MASTER SERVICE AND DISTRIBUTION COMPLIANCE AGREEMENT
THIS AGREEMENT, made THIS 31ST day of December, 1996, by and among
Phoenix Home LIFE MUTUAL INSURANCE COMPANY ("Phoenix"), a New York company, on
behalf of itself and the following Separate Accounts: Phoenix Home Life Variable
Accumulation Account and Phoenix Home Life Variable Universal Life Account
("Separate Accounts") and Phoenix Equity PLANNING Corporation ("PEPCO"), a
Connecticut corporation.
WITNESSETH:
WHEREAS, Phoenix offers for sale variable annuity and variable life
contracts/policies funded through Separate Accounts of Phoenix registered as
unit investment trusts under the Investment Company Act of 1940, as amended
("1940 Act"), and pursuant to registration statements filed with the Securities
and Exchange Commission under the Securities Act of 1933, as amended
("Securities Act"), and listed on Schedule A of this Agreement (the
"Contracts/Policies"), and
WHEREAS, PEPCO is registered as a broker-dealer with the Securities
and Exchange commission ("SEC") under the Securities Exchange Act of 1934, as
amended ("1934 Act") and is a member of the National Association of Securities
Dealers, Inc. ("NASD"), and
WHEREAS, Phoenix desires to engage PEPCO to perform certain services
with respect to the books and records to be maintained in connection with the
sale of Contracts/Policies and certain administrative and other functions as set
forth herein.
NOW, THEREFORE, in consideration of the mutual covenants herein
contained, the parties hereto agree as follows:
I. SERVICES OF PEPCO
A. APPOINTMENT. Phoenix hereby appoints PEPCO, and PEPCO hereby
accepts the appointment as, Master Service and Distributor of the
Contracts/Policies.
B. DUTIES. PEPCO sh~ perform those administrative, compliance
and other services with respect to the Contracts/Policies as described herein.
PEPCO agrees to use its best efforts in performing the
activities outlined in paragraphs I. C and I. F of this Agreement.
C. WRITTEN AGREEMENTS. PEPCO has and shall enter into written
agreements with broker-dealerfirms whose registered representatives have been
or shall be properly licensed to sell registered securities and
insurance products including variable annuity and life licensed if required,
and appointed as life insurance agents of Phoenix. Phoenix shall pay all fees
associated with the appointments of such selected representatives as insurance
agents of Phoenix. Such agreements with broker-dealers shall provide that such
broker-dealer shall cause applications to be solicited for the purchase of the
Contracts/Policies. Such agreements shall include such terms and conditions as
PEPCO may determine not inconsistent with this Agreement, provided, however,
that any broker-
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dealer with whom PEPCO has entered into a written agreement must comply with
the following terms which shall be included in all such agreements:
The broker-dealer must -
(a) be a registered broker-dealer under the 1934 Act and be
a member of the NASD; and
(b) agree that, in connection with the solicitation of
applications for the purchase of Contracts/Policies,
the broker-dealer will in all respects conform to
the requirements of all state and federal laws and
the Rules of Fair Practice of the NASD relating to
the sale of the Contracts/Policies and will
indemnify and hold harmless PEPCO and Phoenix from
any damage or expense of any nature whatsoever on
account of the negligence, misconduct or wrongful
act of such broker-dealer or any employee,
representative or agent of such broker-dealer.
In obtaining and entering into written agreements with broker-dealers,
PEPCO will in all respects conform to the requirements of all state and federal
law, and the Rules of Fair Practice of the NASD.
D. RECORDKEEPING. PEPCO shall maintain and preserve, or cause to be
maintained and preserved, such accounts, books, and other documents as are
required of it under this Agreement, the 1934 Act and any other applicable laws
and regulations, including without limitation and to the extent applicable,
Rules 1 7a-3 and I 7a-4 under the 1934 Act. The books, accounts and records of
PEPCO as to services provided hereunder, shall be maintained so as to disclose
clearly and accurately the nature and details of the transactions.
E. SUPERVISION. PEPCO shall select associated persons, who are
trained and qualified persons, to solicit applications for purchase of
Contracts/Policies in conformance with applicable state and federal laws. Any
such persons shall be registered representatives of PEPCO in accordance with the
rules of the NASD, be licensed to offer the Contract/Policy in accordance with
the insurance laws of any jurisdiction in which such person solicits
applications, be licensed with and appointed by Phoenix as an insurance agent to
solicit applications for the Contracts/Policies and have entered into the
appropriate Variable Contract/Policy Insurance Commission Agreement with
Phoenix. PFPCO will train and supervise its registered representatives to insure
that the purchase of a Contract/Policy is not recommended to an applicant in the
absence of reasonable grounds to believe that the purchase is suitable for that
applicant. PEPCO shall pay the fees to regulatory authorities in connection with
obtaining necessary securities licenses and authorizations for its registered
representatives to solicit applications for the purchase of Contracts/Policies.
PEPCO is
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not responsible for fees in connection with the appointment of registered
representatives as insurance agents of Phoenix.
F. SALES MATERIALS AND OTHER DOCUMENTS.
(a) PEPCO's RESPONSIBILITIES. PEPCO shall be responsible for
the approval of promotional material by the SEC and the
NASD, where required.
(b) PHOENIX'S RESPONSIBILITIES. Phoenix shall be responsible
for:
(I) the design, preparation and printing of all
promotional material to be used in the distribution
of the Contracts/Policies;
(ii) the approval of promotional material by state and
other local insurance regulatory authorities.
(iii) confirming the issuance of the Contract/Policy to
the Contract/Policy Owner.
(c) RIGHT TO APPROVE. Neither party hereto nor any of its
agents or affiliates shall print, publish or distribute any
advertisement, circular or any document relating to the
Contracts/Policies or relating to the other party unless
such advertisement, circular or document shall have been
approved in writing by the other parry. However, nothing
herein shall prohibit any party from advertising annuities
or life insurance in general or on a generic basis, subject
to compliance with all applicable laws, rules and
regulations. Each party reserves the right to require
modification of any such material to comply with applicable
laws, rules and regulations and agrees to provide timely
responses regarding material submitted to it by the other
party.
G. PAYMENTS TO BROKER-DEALERS. PEPCO shall serve as paying agent for
amounts due broker-dealers for sales commissions. Phoenix shall forward to
PEPCO any such amounts due broker-dealers from Phoenix and PEPCO shall be
responsible to pay such amounts to the persons entitled thereto as set forth in
the applicable written agreements with such broker-dealers, subject to all
applicable state insurance laws and regulations and all applicable federal
and/or state securities
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laws and NASD rules. PEPCO shall reflect such amounts on its books and records
as required by Paragraph D hereto.
H. COMPLIANCE. PEPCO shall, at all times, when performing its
functions under this Agreement, be registered as a securities broker-dealer with
the SEC and the NASD and be licensed or registered as a securities broker-dealer
in any jurisdiction where the performance of the duties contemplated by this
Agreement would require such licensing or registration. PEPCO represents and
warrants that it shall otherwise comply with provisions of federal and state law
in performing its duties hereunder.
I. PAYMENT OF EXPENSES BY PEPCO. PEPCO shall pay the expenses
incurred in connection with its provision of services hereunder and the
distribution of the Contracts/Policies.
II. GENERAL PROVISIONS
A. INSPECTION OF BOOKS AND RECORDS. PEPCO and Phoenix agree that all
records relating to services provided hereunder shall be subject to reasonable
periodic, special or other audit or examination by the SEC, NASD, or any state
insurance commissioner or any other regulatory body having jurisdiction. PEPCO
and Phoenix agree to cooperate fully in any securities or insurance regulatory
or judicial investigation, inspection, inquiry or proceeding arising in
connection with the services provided under this Agreement, or with respect to
PEPCO or Phoenix or their affiliates, to the extent related to the distribution
of the Contracts/Policies. PEPCO and Phoenix will notify each other promptly of
any customer compliant or notice of regulatory or judicial proceeding, and, in
the case of a customer complaint, will cooperate in arriving at a mutually
satisfactory resolution thereof.
B. INDEMNIFICATION. PEPCO will indemnify and hold harmless Phoenix
and the Separate Accounts, from any and all expenses, losses, claims, damages or
liabilities (including attorney fees) incurred by reason of any
misrepresentation, wrongful or unauthorized act or omission, negligence of, or
failure of PEPCO, including any employee of PEPCO, to comply with the terms of
this Agreement, provided however, PEPCO shall not be required to indemnify for
any such expenses, losses, claims, damages or liabilities which have resulted
from the negligence, misconduct or wrongful act of the party seeking
indemnification. PEPCO shall also hold harmless and indemnify Phoenix and the
Separate Accounts for any and all expenses, losses, claims, damages, or
liability (including attorneys fees) arising from any misrepresentation,
wrongful or unauthorized act or omission, negligence of, or failure of a
broker-dealer or its employees, agents or registered representatives, to comply
with the terms of the written agreement entered into between PEPCO and such
broker-dealer but only to the extent that PEPCO is indemnified by the
broker-dealer under the terms of the written agreement. Phoenix will indemnify
and hold harmless PEPCO, for any expenses, losses, claims, damages or
liabilities (including attorneys fees) incurred by reason of any material
misrepresentation or omission in a registration statement or prospectus for the
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Contracts/Policies, or on account of any other misrepresentation, wrongful or
unauthorized act or omission, negligence of, or failure of Phoenix, including
any employee of Phoenix, to comply with the terms of this Agreement, provided
however, Phoenix shall not be required to indemnify for any expenses, losses,
claims, damages or liabilities which have resulted from the negligence,
misconduct or wrongful act of the parry seeking indemnification.
C. COMPENSATION. Phoenix shall compensate PEPCO for the services
PEPCO performs hereunder as the parties shall agree from time to time and as
listed on Schedule A of this Agreement. PEPCO agrees to return promptly to
Phoenix all compensation received for any Contract/Policy returned within the
"free look" period as specified in the Contract/Policy.
D. TERMINATION. This Agreement shall become effective on the date of
this Agreement and shall continue to be in effect, except that:
(a) Any parry hereto may terminate this Agreement on any
date by giving the other parry at least thirty (30)
days prior written notice of such termination
specifying the date fixed therefor.
(b) This Agreement may not be assigned by PEPCO without the
consent of Phoenix.
E. REGISTRATION. Phoenix agrees to use its best efforts to effect and
maintain the registration of the Contracts/Policies under the Securities Act
and the Separate Accounts under the 1940 Act, and to qualify the
Contracts/Policies under the state securities and insurance laws, and to
qualify the Contracts/Policies as annuities/life insurance under the Internal
Revenue Code. Phoenix will pay or cause to be paid expenses (including the fees
and disbursements of its own counsel) of the registration and maintenance of the
Contracts/Policies under the Securities Act and of the Separate Accounts under
the 1940 Act, and to qualify the Contracts/Policies under the state securities
and insurance laws.
F. AUTHORITY. PEPCO shall have authority hereunder only as expressly
granted in this Agreement.
G. MISCELLANEOUS. Phoenix agrees to advise PEPCO immediately in the
case of an issuance by the SEC of any stop order suspending the effectiveness of
any prospectus for the Contracts/Policies, of all actions of the SEC with
respect to any amendments to the registration statement(s) which may from time
to time be filed with the SEC and of any material event which makes untrue any
statement made in the registration statements for the Contracts/Policies, or
which requires the making of a change in the registration statements in order to
make the statement therein not misleading. Phoenix agrees to advise PEPCO in the
event that formal administrative proceedings are instituted against Phoenix by
the SEC, or any state securities or insurance
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department or any other regulatory body regarding Phoenix's duties under this
Agreement, unless Phoenix determines in its sole judgment, exercised in good
faith, that any such administrative proceeding will not have a material adverse
effect upon its ability to perform its obligations under this Agreement. PEPCO
agrees to advise Phoenix in the event that formal administrative proceedings are
instituted against PEPCO by the SEC, NASD, or any state securities or insurance
department or any other regulatory body regarding PEPCO's duties under this
Agreement, unless PEPCO determines in its sole judgment exercised in good faith,
that any such administrative proceedings will not have a material adverse effect
upon its ability to perform its obligations under this Agreement.
H. INDEPENDENT CONTRACTOR PEPCO shall undertake and discharge its
obligations hereunder as an independent contractor and nothing herein shall be
construed as establishing; (i)an employer-employee relation between the parties
hereto; or (ii) a joint venture.
I. GOVERNING LAW. This Agreement shall be governed by and construed
in accordance with the laws of the State of Connecticut.
IN WITNESS WHEREOF, the parties have hereunto set their hands on the
date first above written.
PHOENIX HOME LIFE MUTUAL INSURANCE COMPANY
For itself and PHOENIX HOME LIFE VARIABLE ACCUMULATION ACCOUNT
And PHOENIX HOME LIFE VARIABLE UNIVERSAL LIFE ACCOUNT
By: /s/ Xxxx X. Xxxxx
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Title: Executive Vice President
PHOENIX EQUITY PLANNING CORPORATION
By: /s/ Xxxxxx X. XxXxxxxxxx
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Title: President
SCHEDULE A
PEPCO has been appointed by Phoenix to perform certain administrative,
compliance and other services with respect to the following variable annuity
Contracts/Policies ("Contracts/Policies") issued by Phoenix insurance Company:
THE BIG EDGE AND BIG EDGE PLUS - individual Deferred Variable
Accumulation Annuity Contracts issued by the Phoenix Home
Life Variable Accumulation Account of Phoenix. PEPCO shall
receive payments for services performed under this Agreement
equal to up to 7.25% of purchase payments made under The Big
Edge and Big Edge Plus Contracts. in addition, PEPCO shall
receive an underwriting fee of 75-100 bps on deposits under
The Big Edge and Big Edge Plus Contracts, for sales
assistance attributable to broker-dealers, other than XX
Xxxxxxxx and Co. inc. and PLANCO Financial Services Inc.
GROUP STRATEGIC EDGE - A Group Deferred Variable Accumulation
Contract issued by the Phoenix Home Life Variable
Accumulation Account of Phoenix. PEPCO shall receive payments
for services performed under this Agreement equal to up to 5%
of purchase payments made under the Group Strategic Edge
Contracts. in addition, PEPCO shall receive an underwriting
fee of 75-100 bps on deposits under Group Strategic Edge
Contracts, for sales assistance attributable to
broker-dealers, other than XX Xxxxxxxx and Co.
Inc. and PLANCO Financial Services Inc.
FLEX EDGE, FLEX EDGE SUCCESS AND JOINT EDGE - Variable
Universal Life Insurance Policies issued by the Phoenix Home
Life Variable Universal Life Account of Phoenix. PEPCO shall
receive payment for services performed under this agreement
equal to up to 50% of premium payments made under the
Policies up to the commissionable premium amount, and up to
5% of such payments after the commissionable premium has been
paid in the first Policy Year.
PHOENIX EDGE - Variable Universal Life Insurance Policy
issued by the Phoenix Home Life Variable Universal Life
Account of Phoenix. PEPCO shall receive payment for services
performed under this agreement equal to 5% of premium
payments made under the Policy.
