1
EXHIBIT 99.B.3A
DISTRIBUTION AGREEMENT
FOR THE CONTRACTS FUNDED BY
TIAA-CREF LIFE SEPARATE ACCOUNT VA-1
THIS AGREEMENT made this 30th day of November, 1998, by and among:
TIAA-CREF Life Insurance Company ("TIAA-CREF Life"), a New York insurance
corporation, for itself and on behalf of TIAA-CREF Life Separate Account VA-1
(the "Separate Account"), a separate account of TIAA-CREF Life established
pursuant to the New York State Insurance Law; and Teachers Personal Investors
Services, Inc. ("TPIS"), a Delaware corporation.
WITNESSETH:
WHEREAS, TIAA-CREF Life has established the Separate Account to
segregate assets funding the variable benefits provided by the Personal Annuity
Select, an individual, flexible premium, deferred annuity (the "Contracts"), as
well as by other contracts that may be offered by TIAA-CREF Life in the future;
and
WHEREAS, the Separate Account is registered as a unit investment trust
under the Investment Company Act of 1940, as amended (the "1940 Act"), and
currently consists of a single investment account that invests in the Stock
Index Fund of TIAA-CREF Life Funds (known as the Stock Index Account), and may
consist of additional investment accounts in the future (collectively, with the
Stock Index Account, referred to herein as "Accounts"); and
WHEREAS, TPIS will be the principal underwriter distributing the
Contracts and is registered as a broker-dealer under the Securities Exchange Act
of 1934, as amended (the "1934 Act"), and is a member of the National
Association of Securities Dealers, Inc.("NASD"); and
WHEREAS, TIAA-CREF Life and the Separate Account have filed a
registration statement to register the Contracts under the Securities Act of
1933, as amended (the "1933 Act"), and desires to retain TPIS to distribute the
Contracts and TPIS is willing to distribute the Contracts in the manner and on
the terms set forth herein; and
WHEREAS, TIAA-CREF Life is willing to compensate TPIS for the services
to be provided in the manner and on the terms set forth herein.
NOW, THEREFORE, in consideration of the premises and the mutual
covenants herein contained, TIAA-CREF Life, the Separate Account, and TPIS
hereby agree as follows:
2
1. Distribution of the Contracts.
(a) TIAA-CREF Life and the Separate Account hereby grant to
TPIS the exclusive right, subject to the requirements of the 1933 Act, the 1934
Act, and the 1940 Act, and the terms set forth herein, to distribute the
Contracts during the term of this Agreement. TPIS agrees to use its best efforts
to distribute the Contracts, and to advise owners of Contracts in connection
therewith.
(b) To the extent necessary to offer the Contracts, TPIS shall
be duly registered or otherwise qualified under the securities laws of any state
or other jurisdiction in which such Contracts may lawfully be sold and in which
TPIS is licensed or otherwise authorized to sell the Contracts. TPIS shall be
responsible for the training, supervision and control of its registered
representatives for the purpose of the NASD Rules and Fair Practice and federal
and state securities law requirements applicable in connection with the offering
and sale of the Contracts. In this connection, TPIS shall retain written
supervisory procedures in compliance with Section 3010 of the NASD Conduct
Rules.
(c) TPIS agrees to offer the Contracts for sale in accordance
with the then-current prospectus and statement of additional information ("SAI")
for the Separate Account filed with the Securities and Exchange Commission (the
"Commission").
(d) TIAA-CREF Life shall furnish TPIS with copies of all
prospectuses, SAIs, financial statements and other documents which TPIS
reasonably requires for use in connection with the distribution of the
Contracts. TPIS will be entitled to rely on all documentation and information
furnished to it by TIAA-CREF Life or the Separate Account.
(e) It is understood that no payments made under the Contracts
shall be paid or remitted to TPIS.
2. Books and Records
(a) TIAA-CREF Life, the Separate Account, and TPIS shall cause
to be maintained and preserved all required books of account and related
financial records as are required by the 1934 Act, the NASD and any other
applicable laws and regulations. All the books and records maintained by
TIAA-CREF Life (on behalf of TPIS) in connection with the offer and sale of the
Contracts shall be maintained and preserved in conformity with the requirements
of Rules 17a-3 and 17a-4 under the 1934 Act or the corresponding provisions of
any future federal securities laws or regulations, to the extent that such
requirements are applicable to the variable annuity operations. All such books
and records shall be maintained
-2-
3
and held by TIAA-CREF Life on behalf of and as agent for TPIS, whose property
they are and shall remain. Such books and records shall be at all times subject
to inspection by the Commission in accordance with Section 17(a) of the 1934
Act. TIAA-CREF Life shall retain control and responsibility for any functions
that it may delegate to other parties in connection with services rendered
pursuant to this agreement.
(b) TPIS shall have the responsibility for maintaining the
records of sales representatives licensed, registered and otherwise qualified to
sell the Contracts.
3. Reports. TPIS shall cause TIAA-CREF Life and/or the Separate Account
to be furnished with such reports as either or both may reasonably request for
the purpose of meeting reporting and recordkeeping requirements under the
insurance laws of the State of New York and any other applicable states or
jurisdictions.
4. Compensation and Expenses.
(a) In consideration of the services performed by TPIS
hereunder, TIAA-CREF Life shall compensate TPIS monthly. The amount of this
compensation shall be based on the premiums (which shall include amounts from
investment vehicles of companies other than TIAA) received by TIAA-CREF Life and
allocated to the Separate Account under the Contracts. The current rate of
compensation is shown on Schedule A, attached herewith.
(b) The Separate Account shall not be liable to TPIS (or
TIAA-CREF Life) for any expenses incurred for services related to the
distribution of the Contracts (except to the extent that amounts arising from
the mortality and expense risk charge paid to TIAA-CREF Life are deemed to cover
such distribution expenses). TPIS shall be responsible for all expenses relating
to the distribution of the Contracts, including but not limited to:
(i) the costs and expenses of providing the necessary
facilities, personnel, office equipment and supplies, telephone service, and
other utility service necessary to carry out its obligations hereunder;
(ii) charges and expenses of outside legal counsel
retained with respect to activities related to the distribution of the
Contracts;
(iii) the costs and expenses of underwriting and
issuance of the Contracts;
(iv) the costs and expenses of printing definitive
prospectuses and statements of additional information and any supplements
thereto for prospective purchasers;
-3-
4
(v) expenses incurred in connection with TPIS's
registration as a broker or dealer or in the registration or qualification of
its officers, directors or representatives under federal and state securities
laws;
(vi) the costs of promotional, sales and advertising
materials; and
(vii) any other expenses incurred by TPIS or its
representatives in connection with performing the obligations of TPIS under this
Agreement.
6. Non-Exclusivity. TIAA-CREF Life and the Separate Account agree that
the services to be provided by TPIS hereunder are not to be deemed exclusive and
TPIS is free to act as distributor of other variable insurance products or
investment company shares issued by TIAA-CREF Life or any entity affiliated
therewith. TPIS shall, for all purposes herein, be deemed to be an independent
contractor and shall, unless otherwise provided or authorized, have no authority
to act for or represent TIAA-CREF Life or the Separate Account in any way or
otherwise be deemed an agent of TIAA-CREF Life or the Separate Account other
than in furtherance of its duties and responsibilities as set forth in this
Agreement.
7. Liability. TPIS will not be liable for any error of judgment or
mistake of law or for any loss suffered by the Separate Account in connection
with the matters to which this Agreement relates. Nothing herein contained shall
be construed to protect TPIS against any liability resulting from the bad faith
or negligence of TPIS in the performance of its obligations and duties or from
reckless disregard of its obligations and duties under this Agreement or by
virtue of violation of any applicable law.
8. Regulation.
(a) This Agreement shall be subject to the provisions of the
1940 Act, the 1934 Act and the rules, regulations and rulings thereunder, and of
the NASD, as in effect from time to time, including such exemptions and other
relief as the Commission, its staff, or the NASD may grant, and the terms hereof
shall be interpreted and construed in accordance therewith. Without limiting the
generality of the foregoing, the term "assigned" shall not include any
transactions exempted from Section 15(b)(2) of the 1940 Act.
(b) TPIS shall submit to all regulatory and administrative
bodies having jurisdiction over the present and future operations of the
Separate Account, any information, reports or other material which any such body
by reason of this Agreement may request or require pursuant to applicable law or
regulations. Without limiting the generality of the foregoing, TPIS shall
-4-
5
furnish the SEC, the State of New York Secretary of State and/or the
Superintendent of Insurance with any information or reports which the SEC, the
Secretary of State and/or the Superintendent of Insurance may request in order
to ascertain whether the operations of the Separate Account are being conducted
in a manner consistent with applicable laws or regulations.
9. Investigation and Proceedings.
(a) TIAA-CREF Life, the Separate Account, and TPIS agree to
cooperate fully in any insurance or securities regulatory inspection, inquiry,
investigation, or proceeding or any judicial proceeding with respect to
TIAA-CREF Life, the Separate Account, or TPIS, their affiliates and their
representatives to the extent that such inspection, inquiry, investigation or
proceeding is in connection with the Contracts distributed under this Agreement.
(b) In the case of a customer complaint, TIAA-CREf Life, the
Separate Account, and TPIS will cooperate in investigating such complaint and
shall arrive at a mutually satisfactory response.
10. Duration and Termination of the Agreement.
(a) This Agreement shall become effective with respect to the
Contracts as of the date first written above. It shall become effective as to
any subsequently offered contract when it has been approved by the TIAA-CREF
Life Board of Directors specifically for such contract. "Subsequently offered
contract" means a contract issued and funded by the Separate Account subsequent
to the initial effective date of this Agreement.
(b) This Agreement shall continue in effect for two years from
the date of its execution and thereafter from year to year, but only so long as
such continuance is specifically approved at least annually by the Board of
Directors or by the vote of a majority of the outstanding shares of the Separate
Account.
(c) This Agreement may be terminated, without the payment of
any penalty, by TIAA-CREF Life, the Separate Account, or TPIS on sixty days'
written notice to the other parties. This Agreement shall automatically
terminate in the event of its assignment.
(d) Upon termination of this agreement, all authorizations,
rights and obligations shall cease except the obligation to settle accounts
hereunder and the agreements contained in paragraph 9 hereunder.
11. Definitions. The term "assignment", "interested person" and
"majority of the outstanding shares", when used in this
-5-
6
Agreement, shall have the respective meanings specified under the 1940 Act and
rules thereunder.
12. Further Actions. Each party agrees to perform such further acts and
execute such further documents as are necessary to effectuate the purposes
hereof.
13. Governing Law. The provisions of this Agreement shall be construed
and interpreted in accordance with the laws of the State of New York, as at the
time in effect, and the applicable provisions of the 1940 Act and rules
thereunder or other federal laws and regulations which may be applicable. To the
extent that the applicable law of the State of New York, or any of the
provisions herein, conflict with the applicable provisions of the 1940 Act and
rules thereunder or other federal laws and regulations which may be applicable,
the latter shall control.
14. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original and all of which shall
be deemed one instrument.
15. Notices. All notices and other communications provided for
hereunder shall be in writing and shall be delivered by hand or mailed first
class, postage prepaid, addressed as follows:
(a) If to TIAA-CREF Life -
TIAA-CREF Life Insurance Company
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Attention: Xxxxxx X. Xxxxx
(b) If to TPIS -
Teachers Personal Investors
Services, Inc.
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Attention: Xxxxxx X. Xxxxx
or to such other address as the parties shall designate by notice to the others.
16. Miscellaneous. Captions in this Agreement are included for
convenience or reference only and in no way define or limit any of the
provisions hereof or otherwise affect their construction or effect.
IN WITNESS WHEREOF, TIAA-CREF Life, the Separate Account, and TPIS,
have caused this Agreement to be executed in their names and
-6-
7
on their behalf by and through their duly authorized officers on the day and
year first above written.
TIAA-CREF LIFE INSURANCE COMPANY
for itself and on behalf of
TIAA-CREF LIFE SEPARATE ACCOUNT VA-1
By:/s/ Xxxxxx X. Xxxxx Attest:/s/ Xxxx X. Xxxxxx
Xxxxxx X. Xxxxx
Title: President Title: Assistant Secretary
TEACHERS PERSONAL INVESTORS SERVICES, INC.
By:/s/ Xxxx Xxxx Attest:/s/ Xxxx X. Xxxxxx
Xxxx Xxxx
Title: Vice President, Chief Title: Assistant Secretary
Counsel and Assistant
Secretary
-7-
8
SCHEDULE A to
Distribution Agreement
for the Contracts Funded By
TIAA-CREF Life Separate Account VA-1
The amount payable monthly by TIAA-CREF Life to TPIS in consideration
of the services performed by TPIS under this Agreement is forty hundredths of
one percent (0.40%) of the premiums (as that term is used in paragraph 5(a) of
this Agreement) received by TIAA-CREF Life and allocated to the Separate Account
under the Contracts during each month.
