MARKETING COORDINATION AGREEMENT
THIS MARKETING COORDINATION AGREEMENT is entered into as of the 1st day of
January 1998 by and among Sun Life Assurance Company of Canada (U.S.) ("Sun Life
(U.S.)"), a Delaware corporation; Clarendon Insurance Agency Inc. ("Clarendon"),
a Massachusetts corporation; and Sun Life of Canada (U.S.) Distributors, Inc.
("SDC"), a Delaware corporation.
WITNESSETH
WHEREAS, Sun Life (U.S.) proposes to issue and offer for sale certain
Insurance and Annuity Contracts (the "Plans"), some of which are and others of
which are not deemed to be securities under the Securities Act of 1933, as
amended; and
WHEREAS, Clarendon is registered as a broker-dealer with the Securities and
Exchange Commission (the "SEC") under the Securities Exchange Act of 1934, as
amended (the "1934 Act"), and is a member of the National Association of
Securities Dealers, Inc. (the "NASD"); and
WHEREAS, Clarendon agrees to serve as general distributor with respect to
the Plans in accordance with the terms and conditions of this Agreement; and
WHEREAS, SDC is registered as a broker-dealer with the SEC under the 1934
Act and is a member of the NASD; and
WHEREAS, SDC proposes to assist Clarendon by coordinating the marketing of
the Plans.
NOW THEREFORE, in consideration of the premises and the mutual covenants
hereinafter contained, and other good and valuable consideration, the receipt
and adequacy of which are hereby acknowledged by all parties, the parties hereto
agree as follows:
I. THE PLANS
A. TYPE OF PLANS
The Plans issued by Sun Life (U.S.) to which this Agreement applies are
listed in Exhibit A. Exhibit A may be amended from time to time as may be agreed
upon by Sun Life (U.S.), Clarendon and SDC. All such amendments shall be
reflected in a revised Exhibit A and, to the extent relevant, a revised Exhibit
F (as relates to the applicable Distribution Allowance).
B. SUSPENSION/RESTRICTION
Sun Life (U.S.) may, at its sole discretion, suspend or restrict in any
manner the sale or method of distribution of all or any of the Plans, including
sales by all or any individuals licensed to sell Sun Life (U.S.)'s products. If
any suspension or restriction is required by any regulatory
authority having appropriate jurisdiction, written notice shall be given to
Clarendon and SDC immediately upon receipt by Sun Life (U.S.) of notice of such
required suspension or restriction. In all other cases, Sun Life (U.S.) will
provide at least thirty (30) days' prior written notice to Clarendon and SDC of
any such suspension or restriction, except in the case of any breach of this
agreement by a party, which is addressed by Article VI, Para H (Termination).
C. PLAN CHANGES
Sun life (U.S.) may, at its sole discretion, amend, add or delete features
of any or all of the Plans. In the event of any such amendment, addition or
deletion, Sun Life (U.S.) will provide written notice of such change to
Clarendon and SDC. If the change is required by any regulatory authority having
appropriate jurisdiction, written notice shall be given to Clarendon. In any
other cases, written notice shall be given to Clarendon and SDC at least thirty
(30) days prior to the effective date of such change.
II. MARKETING COORDINATION AND SALES ADMINISTRATION
A. DISTRIBUTION AGREEMENTS
Clarendon will distribute the Plans pursuant to one of four different
standard types of agreements with financial intermediaries (collectively
referred to as "Distribution Agreements"). Copies of the Distribution Agreements
are attached as Exhibits B, C, D and E, respectively. Clarendon, or SDC on its
behalf, shall negotiate all Distribution Agreements, subject to approval by Sun
Life (U.S.); provided that all such Distribution Agreements shall be
substantially in the form of the Distribution Agreements attached as Exhibits B,
C, D and E, respectively unless otherwise agreed by Sun Life (U.S.). No
Commission Schedule attached to any Distribution Agreement may provide for
commission payments in excess of specified maximums established from time to
time by Sun Life (U.S.). Clarendon shall retain copies of all executed
Distribution Agreements and all correspondence, memoranda and other documents
relating to the Distribution Agreements.
B. REPRESENTATIVES
2. APPOINTMENT AND TERMINATION OF REPRESENTATIVES
(a) The Distribution Agreements shall provide for the appointment, as
insurance agent, by Sun Life (U.S.) of the financial intermediaries and
their individual representatives. Sun Life (U.S.) reserves the right to
terminate any and all such designations by and will provide written notice
of any such termination to Clarendon and SDC concurrently with notice to
the particular regulatory authority.
(b) Appointments and/or dismissals of individuals as representatives of Sun
Life (U.S.) shall be made on forms supplied by regulatory authorities
having jurisdiction or otherwise as supplied by Sun Life (U.S.), as the
case may be. All such appointments and dismissals shall be subject to all
applicable laws, rules and regulations and to such written
instructions and rules as Sun Life (U.S.) may establish from time to time
and provide to Clarendon. If requested by Sun Life (U.S.), Clarendon shall
retain copies of all completed forms appointing and/or dismissing agents
and all related correspondence, memoranda and other documents.
(c) Sun Life (U.S.) shall document its licensing and appointment
procedures, which will set forth the then current requirements for
licensing and appointment of representatives in those jurisdictions where
Sun Life (U.S.) transacts an insurance business. Sun Life (U.S.) shall and
also prepare periodic updates of these procedures, which shall be available
to Clarendon at its request.
(d) Clarendon shall have current lists of representatives appointed by Sun
Life (U.S.).
(e) Sun Life (U.S.) shall pay all necessary licensing and appointment fees
(initial and renewal) and other expenses of any type incurred by Clarendon
with respect to Clarendon's licensing and appointment of individuals as
representatives of Sun Life (U.S.), including persons appointed as General
Agents pursuant to the Distribution Agreements.
(f) Clarendon shall be responsible for determining that any individual
soliciting applications for any of Plans is: (i) properly licensed with
state insurance regulatory authorities; (ii) appointed as a representative
of Sun Life (U.S.); (iii) properly licensed, to the extent necessary, under
all applicable securities laws; (iv) associated as a registered
representative with a broker-dealer registered under the 1934 Act who is
also an NASD member and which has executed a Distribution Agreement (in the
case of Plans which are deemed to be securities under the 1934 Act); and
(v) covered by a satisfactory fidelity bond.
2. TRAINING OF REPRESENTATIVES
SDC shall assist Clarendon in training representatives of Sun Life (U.S.)
which have been appointed to solicit applications for the Plans.
3. SUPERVISION OF REPRESENTATIVES
Clarendon shall coordinate the supervision of representatives appointed on
behalf of Sun Life (U.S.) who are associated with broker-dealers in
connection with the offering and sale of the Plans. Clarendon will
establish such rules and procedures as may be necessary to insure proper
supervision of the agents/registered representatives.
4. SALES ASSISTANCE TO REPRESENTATIVES
SDC shall provide sales assistance to representatives appointed on behalf
of Sun Life (U.S.) appointed pursuant to this agreement. This sales
assistance shall include, without limitation, assistance from SDC's field
representatives as well as from SDC's home office
personnel. SDC shall also prepare sales promotional programs for the Plans
and assist the agents in utilizing such programs. In addition, SDC shall
provide such representatives with sufficient quantities of sales
promotional materials, sample Plans, applications and any necessary service
forms.
5. PAYMENT OF COMMISSIONS TO AGENTS/REGISTERED REPRESENTATIVES
Unless otherwise agreed, all commission payments required to be made
pursuant to the Distribution Agreements shall be made by Sun Life (U.S.)
directly to the parties entitled thereto. In the case of Plans which are
securities, such payments shall be made to Clarendon (or as directed by
it), which, in turn, shall pay the entitled party. Sun Life (U.S.) will
fund a commission account which Clarendon may draw upon to make these
payments.
C. SALES MATERIAL AND OTHER DOCUMENTS
1. SDC'S RESPONSIBILITIES
SDC shall be responsible for the design, preparation, printing and use of
all promotional material to be used in the distribution of the Plans; and
for filing all promotional material with the NASD, when applicable. SDC
shall furnish copies of NASD review letters, when requested.
2. SUN LIFE (U.S.)'S RESPONSIBILITIES
(a) Sun Life (U.S.) shall provide Clarendon and SDC with applications and
sample Plans for sales training purposes, all in sufficient quantities for
use by representatives.
(b) Sun Life (U.S.) shall be responsible for the approval of promotional
material if required by state and other local insurance regulatory
authorities.
3. SUN LIFE (U.S.)'S RIGHT TO APPROVE
Sun Life (U.S.) shall have the right to review and approve or disapprove
sales promotional material proposed for use by SDC and reserves the right
to require modification of any such material or forms to comply with
applicable laws, rules and regulations.
D. ADVERTISING
Neither Clarendon nor SDC shall print, publish or distribute any
advertisements, circulars or other documents relating to the Plans or to Sun
Life (U.S.) unless such advertisement, circular or document shall have been
approved in writing by Sun Life (U.S.). Neither Sun Life (U.S.) nor any of its
agents or affiliates shall print, publish or distribute any advertisement,
circular or other document relating to the Plans unless a copy of such
advertisement, circular or document has
been provided to SDC. However, nothing herein shall prohibit any person from
advertising annuities in general or on a generic basis.
E. SALES RECORDS; PRODUCTION REPORTS
Clarendon, or Sun Life (U.S.) on behalf of Clarendon, shall prepare and
maintain sales records, production data and production reports and such other
reports and materials relative to the marketing and distribution of Plans as may
be necessary or appropriate in the furtherance of Sun Life (U.S.)'s insurance
business.
III. ADMINISTRATION OF THE PLANS
A. APPOINTMENT AND DUTIES OF MARKETING ADMINISTRATOR
Clarendon is hereby appointed by Sun Life (U.S.) as Marketing Administrator
with respect to the sale and post-issue servicing of Plans. Clarendon shall be
responsible as Marketing Administrator for the timely and proper performance of
such administrative functions as may be delegated to it from time to time by Sun
Life (U.S.). Clarendon shall perform all such functions in accordance with such
administrative standards, practices and procedures as may be established from
time to time by Sun Life (U.S.). At its sole discretion, Clarendon may delegate
some or all of its Marketing Administration duties to Sun Life (U.S.) or to SDC.
B. PLAN FORMS AND APPLICATIONS
Sun Life (U.S.) shall be responsible for the design, preparation and
printing of the policy forms and related documents which are used with the Plans
in sufficient quantities for issuance to Plan owners.
C. SERVICE FORMS
Sun Life (U.S.) shall be responsible for the design, printing and approval
of service forms not included under Para. B above, which the parties jointly
determine to be necessary in conjunction with the sale or servicing of the
Plans. Sun Life (U.S.) agrees to provide Clarendon with copies of all service
forms prior to their initial use, and to amend or chance any such form if
requested by Clarendon.
IV. COMPENSATION
A. AMOUNT AND TIME OF PAYMENT
For performing the marketing coordination services set forth in this
Agreement, Sun Life (U.S.) will pay the compensation as set forth in the
attached Exhibit F - Schedule of Fees to the parties entitled thereto. Sun Life
(U.S.) will pay all compensation due hereunder on a weekly basis, in accordance
with such Schedule of Fees.
B. CHANGES IN COMPENSATION
Compensation payable under this Agreement may be increased or decreased to
reflect any changes in the marketing coordination responsibilities of Clarendon
or SDC. The Schedule of Fees may be amended or changed only upon mutual
agreement of the parties as to amount and effective date.
C. INDEBTEDNESS
Nothing in this Agreement shall be construed as giving Clarendon or SDC the
right to incur any indebtedness on behalf of Sun Life (U.S.). However, Sun Life
(U.S.) may offset amounts owed it by SDC or Clarendon under this Agreement
against amounts payable to SDC or Clarendon as applicable, for any reason.
V. OTHER PROVISIONS
A. PRODUCT DEVELOPMENT
SDC and Clarendon shall Assist Sun Life (U.S.) in the design and
development of life insurance and annuity products for distribution pursuant to
the Distribution Agreements. This assistance shall include: market research
studies and such other related activity as may be reasonably requested by Sun
Life (U.S.); consulting services with respect to product design; assisting in
the development of sales training, sales promotional and advertising material
relating to new insurance and annuity products. SDC and Clarendon acknowledge
that they have no proprietary rights in such studies and materials and, as among
the parties, all such studies and materials are the exclusive property of Sun
Life (U.S.) and shall constitute proprietary and confidential matter, whether or
not identified as such.
B. OWNERSHIP OF BUSINESS RECORDS
Sun Life (U.S.) shall own all Plan records, tax records, payments records,
Plan descriptions, appointment records, representative's lists and other similar
Plan records maintained by Clarendon or SDC, either on paper or in
machine-readable form, pertaining to the duties and responsibilities of
Clarendon and SDC under or otherwise created in connection with this Agreement.
Such records shall be delivered to Sun Life (U.S.) promptly after its reasonable
request therefor. Clarendon and SDC will maintain all records and accounts in
accordance with Sun Life (U.S.)'s standards or requirements, as communicated
from time to time by Sun Life (U.S.), or otherwise in accordance with generally
accepted industry procedures. At Sun Life (U.S.)'s reasonable request, Clarendon
and SDC will make any such records available to Sun Life (U.S.)'s auditors or to
any governmental authority having jurisdiction over Sun Life (U.S.); but all
such records shall, otherwise, be the sole and exclusive property of Sun Life
(U.S.) and shall constitute proprietary and confidential matter, whether or not
identified as such.
Notwithstanding the foregoing, Sun Life (U.S.), as agent for Clarendon,
shall confirm to each applicant for, and purchaser of, an SEC-registered Plan,
in accordance with Rule 10b-10
under the 1934 Act acceptance of premiums and such other transactions as are
required by Rule 10b-10 administrative interpretations thereunder. Sun Life
(U.S.) shall maintain and preserve books and records with respect to such
confirmations in conformity with the requirements of Rules 17a-3 and 17a-4 under
the 1934 Act to the extent such requirements apply. The books, accounts and
records of Sun Life (U.S.), Clarendon, SDC, the SEC-registered Plans and as to
all transactions hereunder shall be maintained so as to disclose clearly and
accurately the nature and details of the transactions. Sun Life (U.S.) shall
maintain, as agent for Clarandon and SDC, such books and records of Clarendon
SDC pertaining to the distribution and servicing of the Plans and required by
the 1934 Act as may be mutually agreed upon by them, including but not limited
to maintaining a record of selling firms and of the payment of commissions and
other payments or service fees to selling firms. In addition, Sun Life (U.S.),
as agent for Clarendon and SDC, shall maintain and preserve such additional
accounts, books and other record as are required of Clarendon and SDC by the
1934 Act. Sun Life (U.S.) shall maintain all such books and records and hold
such books and records on behalf of and as agent for Clarendon and SDC whose
property they are and shall remain, and acknowledges that such books and records
are at all times subject to inspection by the SEC in accordance with Section
17(a) of the 1934 Act, NASD, and all other regulatory bodies having
jurisdiction.
C. APPROVAL OF PRACTICES AND PROCEDURES
Sun Life (U.S.) shall have the right to review and suggest revisions to the
standards, practices and procedures utilized by Clarendon and SDC in fulfilling
their respective obligations under this Agreement. Sun Life (U.S.) reserves the
right, from time to time, to prescribe reasonable rules and regulations
respecting the conduct of the business covered hereby, as relates to the Plans.
D. COMPLAINTS
1. After recording a customer complaint received by either Clarendon or SDC
in the appropriate customer complaint file, Clarendon and SDC shall immediately
forward to Sun Life (U.S.) any complaints received by them relating to the
Plans, including any notice or complaint which alleges activity or omission by a
representative, broker-dealer, or other person appointed on behalf of Sun Life
(U.S.) under this Agreement. All such complaints shall be reflected, as
appropriate in records and reports filed with the NASD by Clarendon and SDC.
2. In the case of complaints or inquiries relating to the Plans distributed
pursuant to the distribution Agreements, Sun Life (U.S.) shall consult with
Clarendon and DSC, as applicable, before responding and thereafter may respond
directly or request Clarendon or SDC to investigate and/or respond to such
complaints or inquiries. In such instances, Clarendon or SDC, as appropriate,
shall promptly forward to Sun Life (U.S.) copies of all documents and other
material relating to such investigations and/or responses. Whichever party to
this Agreement responds, it is expressly acknowledged and agreed that the
complaint resolution process shall confirm to the "fair dealing" standards
established by the NASD.
E. LIMITATIONS AND AUTHORITY
SDC and Clarendon shall have authority only as expressly granted in this
Agreement. No party to this Agreement shall enter into any proceeding in a court
of law or before a regulatory agency in the name of any other party, without the
express written consent of that party. If any legal or administrative
proceedings are commenced against any party arising out of the obligations,
duties or services performed under this Agreement by any third party or any
federal, state or other governmental or regulatory authority, that party, as the
case may be, shall immediately notify the other parties of this fact.
VI. GENERAL PROVISIONS
A. WAIVER
Failure of any party to insist upon strict compliance with any of the
conditions or provisions of this Agreement shall not be construed as a waiver of
any of such conditions or provision; and this Agreement shall remain in full
force and effect. No waiver of any of the provisions of this Agreement shall be
deemed, or shall constitute, a waiver of any other provisions, whether or not
similar, nor shall any waiver constitute a continuing waiver.
B. FIDELITY BOND
Clarendon and SDC will maintain whatever fidelity bond as may be required
by Sun Life (U.S.), and such bond shall be of a type and amount and issued by a
reputable company, satisfactory to Sun Life (U.S.).
C. BINDING EFFECT; ENTIRE AGREEMENT
This Agreement shall be binding on and shall inure to the benefit of the
parties to it and their respective successors and assigns; but no party may
assign its interest herein, directly or indirectly, without the prior written
consent of the other parties hereto, failing which this Agreement shall be
deemed to terminate automatically as to such party. This Agreement, including
all Exhibits and Schedules hereto, constitutes the sole and entire understanding
of the parties with respect to the marketing coordination services to be
provided with respect to the Plans and supersedes all prior oral or written
agreements between or among the parties with respect to the services
contemplated by this Agreement.
D. NOTICES
All notices, requests, demands and other communication under this Agreement
shall be in writing, and shall be deemed to have been given on the date of
service if served personally on the party to whom notice is to be given, or as
of the date of mailing, if sent by First Class Mail, Registered or Certified,
postage prepaid and promptly addressed follows:
AMENDMENT #1
MARKETING COORDINATION AGREEMENT
By agreement, the undersigned hereby amend the Marketing Coordination
Agreement ("Agreement") entered into as of the 1st day of January, 1998 as
follows:
1) EXHIBIT F: The applicable Distribution Allowance for the Plans is
amended, as of April 3, 2000, as per the attached Exhibit F.
2) NOTICES: Unless subsequently changed by the parties, in writing, all
notices shall be addressed as follows:
TO SUN LIFE (U.S.):
Sun Life Assurance Company of Canada (U.S.)
Xxx Xxxxxx Xxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Xxxxxx Xxxxx
TO SDC:
Sun Life of Canada (U.S.) Distributors, Inc.
Retirement Products & Services
Xxx Xxxxxx Xxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attention: Secretary
TO CLARENDON:
Clarendon Insurance Agency, Inc.
One Sun Life Executive Park
Xxxxxxxxx Xxxxx, Xxxxxxxxxxxxx 00000
Attention: Secretary
In witness whereof, each of the undersigned parties has executed this
Amendment #1 by its duly authorized officers, to be effective as of April 3,
2000. Except as expressly amended herein, all other provisions of the
Agreement continue as set forth therein.
Sun Life Assurance Company of Canada (U.S.)
by:________________________________________
by:________________________________________
Sun Life of Canada (U.S.) Distributors, Inc.
by:________________________________________
by:________________________________________
Clarendon Insurance Agency, Inc.
by:________________________________________
by:________________________________________
AMENDMENT #2
MARKETING COORDINATION AGREEMENT
By agreement, the undersigned hereby amend the Marketing Coordination
Agreement ("Agreement") entered into the 1st day of January, 1998 as follows:
1) EXHIBIT F: The applicable Distribution Allowance for the Plans is
amended, as of May 1, 2001, as per the attached Exhibit F.
In witness whereof, each of the undersigned parties has executed this
Amendment #2 by its duly authorized officers, to be effective as of May 1, 2001.
Except as expressly amended herein, all other provisions of the Agreement
continue as set forth therein.
SUN LIFE ASSURANCE COMPANY OF CANADA (U.S.)
By: _______________________________________________________________
Xxxx XxXxxx, Vice President, Individual Insurance
By: _______________________________________________________________
Xxxxxx X. Xxxx, Assistant Vice President and Senior Counsel
SUN LIFE OF CANADA (U.S.) DISTRIBUTORS, INC.
By: _______________________________________________________________
Xxxxxx X. Xxxxx, Secretary
By: _______________________________________________________________
Xxxxxxx X. Xxxxx, Assistant Secretary
CLARENDON INSURANCE AGENCY, INC.
By: _______________________________________________________________
Xxxxx X. Xxxxx, Director and Treasurer
By: _______________________________________________________________
Xxxxxxx X. Xxxxx, Assistant Secretary and Assistant Clerk
EXHIBIT F
FUTURITY FLEXIBLE PREMIUM VARIABLE UNIVERSAL LIFE INSURANCE AND
FUTURITY SURVIVORSHIP VARIABLE UNIVERSAL LIFE INSURANCE
For performing the marketing coordination services set forth in this agreement,
Sun Life (U.S.) will pay compensation to Sun Life of Canada (U.S.) Distributors,
Inc. in an amount not to exceed 115% of first year premium paid.
In the event that a contract for which a commission has been paid is surrendered
by the contract owner, is lapsed or returned pursuant to the so-called "ten day
free look" provision of the contract the following percentage of commissions
will be due to Sun Life of Canada (U.S.).
CHARGEBACK SCHEDULE
Month Percentage
1-6 100
7-12 50
