AGREEMENT made this 4th day of March, 1983, by and between The Prudential
Insurance Company of America, a New Jersey corporation ("Company"), on its own
behalf and on behalf of The Prudential Individual Variable Contract Account and
The Prudential Qualified Individual Variable Contract Account ("Accounts"), and
Pruco Securities Corporation, a New Jersey corporation ("Distributor").
WITNESSETH:
WHEREAS, the Company has established and maintains the Accounts, separate
investment accounts, pursuant to the laws of New Jersey for the purpose of
selling variable annuity contracts ("Contracts"), to commence after the
effectiveness of the respective Registration Statement for each Account filed
with the Securities and Exchange Commission on Form S-6 pursuant to the
Securities Act of 1933, as amended (the "1933 Act"); and
WHEREAS, each Account is registered as a unit investment trust under the
Investment Company Act of 1940 (the "1940 Act"); and
WHEREAS, Distributor is registered as a broker-dealer under the Securities
Exchange Act of 1934 (the "Securities Exchange Act") and is a member of the
National Association of Securities Dealers, Inc. ("NASD"); and
WHEREAS, the Company and the Distributor wish to enter into an agreement to
have the Distributor act as the Company's principal underwriter for the sale of
the Contracts through the Accounts;
NOW, THEREFORE, the parties agree as follows:
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1. Appointment of the Distributor
The Company agrees that during the term of this agreement it will take all
action which is required to cause the Contracts to comply with all applicable
federal securities and state insurance laws and regulations. The Company
appoints the Distributor and the Distributor agrees to act as the principal
underwriter for the sale of Contracts to the public, during the term of this
Agreement, in each state and other jurisdiction in which such Contracts may
lawfully be sold. Distributor shall offer the Contracts for sale and
distribution pursuant to terms set by the Company. Applications for the
Contracts shall be solicited only by representatives duly and appropriately
licensed and otherwise qualified for the sale of such Contracts in each state or
other jurisdiction as representatives of Distributor or a Broker as defined in
pargraph 2 hereof and as agents of Company. Completed applications for Contracts
shall be transmitted directly to the Company for acceptance or rejection in
accordance with underwriting rules established by the Company. Initial payments
under the Contracts shall be made by check payable to the Company and shall be
transmitted promptly by Distributor or its representatives to the Company, as
will any other payments received by Distributor or its representatives.
2. Sales Agreements
Distributor is hereby authorized to enter into separate written agreements,
on such terms and conditions as Distributor may determine not inconsistent with
this Agreement, with one or more organizations which agree to participate in the
distribution of Contracts. Any such organization (hereafter "Broker") shall be
both registered as a broker/dealer under the Securities Exchange Act and a
member of NASD.
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Broker and its agents or representatives soliciting applications for Contracts
shall be duly and appropriately licensed, registered or otherwise qualified for
the sale of such Contracts under the insurance laws and any applicable blue-sky
laws of each state or other jurisdiction in which the Company is licensed to
sell the Contracts.
Distributor shall have the responsibility for ensuring that Broker
supervises its representatives. Any agreement as described in this Section shall
provide that Broker shall assume any legal responsibilities of the Company for
the acts, commissions or defalcations of such representatives insofar as they
relate to the sale of the Contracts. Applications for Contracts solicited by
such Broker through its agents or representatives shall be transmitted directly
to the Company, and if received by Distributor, shall be forwarded to Company.
All payments under the Contracts shall be made by check to Company and remitted
promptly to Company.
3. Life Insurance Agents
Company shall be responsible for insuring that Brokers are duly qualified,
under the insurance laws of the applicable jurisdictions, to sell the Contracts.
14. Suitability
Company wishes to ensure that Contracts sold by Distributor will be issued
to purchasers for whom the Contract will be suitable. Distributor shall take
reasonable steps to ensure that the various representatives appointed by it
shall not make recommendations to an applicant to purchase a Contract in the
absence of reasonable grounds to
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believe that the purchase of the Contract is suitable for such applicant. While
not limited to the following, a determination of suitability shall be based on
information furnished to a representative after reasonable inquiry of such
applicant concerning the applicant's insurance and investment objectives and
financial situation and needs.
5. Promotion Materials
Company shall have the responsibility for furnishing to Distributor and its
representatives sales promotion materials and individual sales proposals related
to the sale of the Contracts. Distributor shall not use any such materials that
have not been approved by Company.
6. Compensation
Company shall arrange for the payment of commission directly to those
registered representatives of Distributor who are entitled thereto in connection
with the sale of the Contracts on behalf of Distributor, in the amounts and on
such terms and conditions as Company and Distributor shall determine; provided
that such terms, conditions and commissions shall be as are set forth in or as
are not inconsistent with the Prospectus included as part of the respective
Registration Statement for of each Account and effective under the 1933 Act.
Company shall arrange for the payments of commissions directly to those
Brokers who sell Contracts under agreements entered into pursuant to paragraph
2. hereof, in amounts as may be agreed to among the parties and specified in
such written agreements.
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Company shall reimburse Distributor for the costs and expenses incurred by
Distributor in furnishing or obtaining the services, materials and supplies
required by the terms of this Agreement in the initial sales efforts and the
continuing obligations hereunder.
7. Records
Distributor shall have the responsibility for maintaining the records of
representatives licensed, registered and otherwise qualified to sell the
Contracts. Distributor shall maintain such other records as are required of it
by applicable laws and regulations. The books, accounts and records of Company,
the Accounts and Distributor shall be maintained so as to clearly and accurately
disclose the nature and details of the transactions.
8. Investigation and Proceeding
(a) Distributor and Company agree to cooperate fully in any insurance
regulatory investigation or proceeding or judicial proceeding arising in
connection with the Contracts distributed under this Agreement. Distributor and
Company further agree to cooperate fully in any securities regulatory
investigation or proceeding or judicial proceeding with respect to Company,
Distributor, their affiliates and their agents or representatives to the extent
that such investigation or proceeding is in connection with Contracts
distributed under this Agreement.
(b) In the case of a substantive customer complaint, Distributor and
Company will cooperate in investigating such complaint and any response to such
complaint will be sent to the other party to this Agreement for approval not
less than five business days prior to its being sent to the
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customer or regulatory authority, except that if a more prompt response is
required, the proposed response shall be communicated by telephone or telegraph.
9. Termination
This Agreement shall terminate automatically upon its assignment without
the prior written consent of both parties. This Agreement may be terminated at
any time by either party on 60 days' written notice to the other party, without
the payment of any penalty. Upon termination of the this Agreement all
authorizations, rights and obligations `shall cease except the obligation to
settle accounts hereunder, including commissions on payments subsequently
received for Contracts in effect at the time of termination, and the agreements
contained in paragraph 8. hereof.
10. Regulation
This Agreement shall be subject to the provisions of the 1940 Act and the
Securities Exchange Act and the rules, regulations, and rulings thereunder and
of the applicable rules and regulations of the NASD, from time to time in
effect, and the terms hereof shall be interpreted and construed in accordance
therewith.
11. Severability
If any provision of this Agreement shall be held or made invalid by a court
decision, statute, rule or otherwise, the remainder of this Agreement shall not
be affected thereby.
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12. Applicable Law
This Agreement shall be construed and enforced in accordance with and
governed by the laws of the State of New Jersey.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the day and year first above written.
Attest: THE PRUDENTIAL INSURANCE COMPANY
OF AMERICA
/s/ [ILLEGIBLE] By /s/ Xxxx X. Xxxxxx
----------------------------- -----------------------------------
Secretary Xxxx X. Xxxxxx
Senior Vice President
PRUCO SECURITIES CORPORATION
Attest:
/s/ [ILLEGIBLE] By /s/ [ILLEGIBLE]
----------------------------- -----------------------------------
Secretary President
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