EXHIBIT 1.A.3(a)
PRINCIPAL UNDERWRITING AGREEMENT
THIS PRINCIPAL UNDERWRITING AGREEMENT made and effective as of the 30th
day of April, 1998, by and between AFSG SECURITIES CORPORATION ("AFSG"), a
Pennsylvania corporation, and PFL LIFE INSURANCE COMPANY ("PFL"), an Iowa
corporation, on its own behalf and on behalf the separate investment accounts of
PFL set forth in EXHIBIT A attached hereto and made a part hereof (collectively,
the "Account").
WITNESSETH:
WHEREAS, the Account was established or acquired by PFL under the laws
of the State of Iowa, pursuant to a resolution of PFL's Board of Directors in
order to set aside the investment assets attributable to certain flexible
premium, multi-funded annuity contracts ("Contracts") issued by PFL;
WHEREAS, PFL has registered or will register the Account with the
Securities and Exchange Commission ("SEC") as a unit investment trust under the
Investment Company Act of 1940 (the "1940 Act");
WHEREAS, PFL has registered or will register the Contracts under the
Securities Act of 1933 (the "1933 Act");
WHEREAS, AFSG is and will continue to be registered as a broker-dealer
with the SEC under the Securities Exchange Act of 1934 (the "1934 Act"), and a
member of the National Association of Securities Dealers, Inc. (the "NASD")
prior to the offer and sale of the Contracts; and
WHEREAS, PFL proposes to have the Contracts sold and distributed
through AFSG, and AFSG is willing to sell and distribute such Contracts under
the terms stated herein;
NOW, THEREFORE, the parties, intending to be legally bound, hereby
agree as follows:
1. APPOINTMENT AS DISTRIBUTOR/PRINCIPAL UNDERWRITER. PFL grants to AFSG
the exclusive right to be, and AFSG agrees to serve as, distributor and
principal underwriter of the Contracts during the term of this Agreement. AFSG
agrees to use its best efforts to solicit applications for the Contracts and
otherwise perform all duties and functions, which are necessary and proper for
the distribution of the Contracts.
2. PROSPECTUS. AFSG agrees to offer the Contracts for sale in
accordance with the registration statements and prospectus therefor then in
effect. AFSG is not authorized to give any information or to make any
representations concerning the Contracts other than those contained in the
current prospectus therefor filed with the SEC or in such sales literature as
may be authorized by PFL.
3. CONSIDERATIONS. All premiums, purchase payments or other moneys
payable under the Contracts shall be remitted promptly in full together with
such application, forms and any other required documentation to PFL or its
designated servicing agent and shall become the exclusive property of PFL.
Checks or money orders in payment under the Contracts shall be drawn to the
order of "PFL Life Insurance Company" and funds may be remitted by wire if prior
written approval is obtained from PFL.
4. COPIES OF INFORMATION. On behalf of the Account, PFL shall furnish
AFSG with copies of all prospectuses, financial statements and other documents
which AFSG reasonably requests for use in connection with the distribution of
the Contracts.
5. REPRESENTATIONS. AFSG represents that it is (a) duly registered as a
broker-dealer under the 1934 Act, (b) a member in good standing of the NASD and
(c) to the extent necessary to offer the Contracts, duly registered or otherwise
qualified under the securities laws of any state or other jurisdiction. AFSG
shall be responsible for carrying out its sales and underwriting obligations
hereunder in continued compliance with the NASD Rules and federal and state
securities and insurance laws and regulations. Further, AFSG represents and
warrants that it will
2
adopt, abide by and enforce the principles set forth in the Principles and Code
of Ethical Market Conduct of the Insurance Marketplace Standards Association as
adopted by the Company.
6. OTHER BROKER-DEALER AGREEMENTS. AFSG is hereby authorized to enter
into written sales agreements with other independent broker-dealers for the sale
of the Contracts. All such sales agreements entered into by AFSG shall provide
that each independent broker-dealer will assume full responsibility for
continued compliance by itself and by its associated persons with the NASD Rules
and applicable federal and state securities and insurance laws, shall provide
that each independent broker-dealer will adopt, abide by and enforce the
principles set forth in the Principles and Code of Ethical Market Conduct of the
Insurance Marketplace Standards Association as adopted by the Company, and shall
be in such form and contain such other provisions as PFL may from time to time
require. All associated persons of such independent broker-dealers soliciting
applications for the Contracts shall be duly and appropriately registered by the
NASD and licensed and appointed by PFL for the sale of Contracts under the
insurance laws of the applicable states or jurisdictions in which such Contracts
may be lawfully sold. All applications for Contracts solicited by such
broker-dealers through their representatives, together with any other required
documentation and premiums, purchase payments and other moneys, shall be handled
as set forth in paragraph 3 above.
7. INSURANCE LICENSING AND APPOINTMENTS. PFL shall apply for the proper
insurance licenses and appointments in appropriate states or jurisdictions for
the designated persons associated with AFSG or with other independent
broker-dealers that have entered into sales agreements with AFSG for the sale of
Contracts, provided that PFL reserves the right to refuse to appoint any
proposed registered representative as an agent or broker, and to terminate an
agent or broker once appointed.
8. RECORDKEEPING. PFL and AFSG shall cause to be maintained and
preserved for the periods prescribed such accounts, books, and other documents
as are required of them by the
3
1940 Act, and 1934 Act, and any other applicable laws and regulations. The
books, accounts and records of PFL, of the Account, and of AFSG as to all
transactions hereunder shall be maintained so as to disclose clearly and
accurately the nature and details of the transactions. PFL (or such other entity
engaged by PFL for this purpose), on behalf of and as agent for AFSG, shall
maintain AFSG's books and records pertaining to the sale of Contracts to the
extent as mutually agreed upon from time to time by PFL and AFSG; provided that
such books and records shall be the property of AFSG, and shall at all times be
subject to such reasonable periodic, special or other audit or examination by
the SEC, NASD, any state insurance commissioner and/or all other regulatory
bodies having jurisdiction. PFL shall be responsible for sending on behalf of
and as agent for AFSG all required confirmations on customer transactions in
compliance with applicable regulations, as modified by an exemption or other
relief obtained by PFL. AFSG shall cause PFL to be furnished with such reports
as PFL may reasonably request for the purpose of meeting its reporting and
record-keeping requirements under the insurance laws of the State of Iowa and
any other applicable states or jurisdictions. PFL agrees that its records
relating to the sale of Contracts shall be subject to such reasonable periodic,
special or other audit or examination by the SEC, NASD, and any state insurance
commissioner and/or all other regulatory bodies having jurisdiction.
9. COMMISSIONS. PFL shall have the responsibility for paying on behalf
of AFSG (a) any compensation to other independent broker-dealers and their
associated persons due under the terms of any sales agreements entered into
pursuant to paragraph 6 above, between AFSG and such broker-dealers as agreed to
by PFL and (b) all commissions or other fees to associated persons of AFSG which
are due for the sale of the Contracts in the amounts and on such terms and
conditions as PFL and AFSG determine. Notwithstanding the preceding sentence, no
broker-dealer, associated person or other individual or entity shall have an
interest in any deductions or other fees payable to AFSG as set forth herein.
4
10. EXPENSE REIMBURSEMENT. PFL shall reimburse AFSG for all costs and
expenses incurred by AFSG in furnishing the services, materials, and supplies
required by the terms of this Agreement.
11. INDEMNIFICATION. PFL agrees to indemnify AFSG for any losses
incurred as a result of any action taken or omitted by AFSG, or any of its
officers, agents or employees, in performing their responsibilities under this
Agreement in good faith and without willful misfeasance, gross negligence, or
reckless disregard of such obligations.
12. REGULATORY INVESTIGATIONS. AFSG and PFL agree to cooperate fully in
any insurance or judicial regulatory investigation or proceeding arising in
connection with Contracts distributed under this Agreement. AFSG and PFL further
agree to cooperate fully in any securities regulatory inspection, inquiry,
investigation or proceeding or any judicial proceeding with respect to PFL,
AFSG, their affiliates and their representatives to the extent that such
inspection, inquiry, investigation or proceeding or judicial proceeding is in
connection with Contracts distributed under this Agreement. Without limiting the
foregoing:
(a) AFSG will be notified promptly of any customer complaint or notice
of any regulatory inspection, inquiry investigation or proceeding or judicial
proceeding received by PFL with respect to AFSG or any representative or which
may affect PFL's issuance of any Contracts marketed under this Agreement; and
(b) AFSG will promptly notify PFL of any customer complaint or notice
of any regulatory inspection, inquiry, investigation or judicial proceeding
received by AFSG or any representative with respect to PFL or its affiliates in
connection with any Contracts distributed under this Agreement.
In the case of a customer complaint, AFSG and PFL will cooperate in
investigating such complaint and shall arrive at a mutually satisfactory
response.
5
13. TERMINATION.
(a) This Agreement may be terminated by either party hereto upon 60
days' prior written notice to the other party.
(b) This Agreement may be terminated upon written notice of one party
to the other party hereto in the event of bankruptcy or insolvency of such party
to which notice is given.
(c) This Agreement may be terminated at any time upon the mutual
written consent of the parties hereto.
(d) AFSG shall not assign or delegate its responsibilities under this
Agreement without the written consent of PFL.
(e) Upon termination of this Agreement, all authorizations, rights and
obligations shall cease except the obligations to settle accounts hereunder,
including payments or premiums or contributions subsequently received for
Contracts in effect at the time of termination or issued pursuant to
applications received by PFL prior to termination.
14. REGULATORY IMPACT. This Agreement shall be subject to, among other
laws, the provisions of the 1940 Act and the 1934 Act and the rules,
regulations, and rulings thereunder and of the NASD, from time to time in
effect, including such exemptions from the 1940 Act as the SEC may grant, and
the terms hereof shall be interpreted and construed in accordance therewith.
AFSG shall submit to all regulatory and administrative bodies having
jurisdiction over the operations of the Account, present or future; and will
provide any information, reports or other material which any such body by reason
of this Agreement may request or require pursuant to applicable laws or
regulations.
15. 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.
6
16. CHOICE OF LAW. This Agreement shall be construed, enforced and
governed by the laws of the State of Iowa.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
signed by their respective duly authorized officials as of the day and year
first above written.
AFSG SECURITIES CORPORATION PFL LIFE INSURANCE COMPANY
By: /s/ XXXXX X. XXXXXXXX By: /s/ XXXXXXX X. XXXXXX
--------------------- ---------------------
Xxxxxx X. Xxxxxxxx Xxxxxxx X. Xxxxxx
Title: President Title: President
---------- ---------
7
EXHIBIT A
1. PFL Life Variable Annuity Account A
2. PFL Endeavor VA Separate Account
3. PFL Xxxxxx Variable Annuity Account
4. PFL Retirement Builder Variable Annuity Account
5. PFL Endeavaor Target Account
8
AMENDMENT TO
PRINCIPAL UNDERWRITING AGREEMENT
This Amendment to Principal Underwriting Agreement is made and
effective as of the 1st day of October, 1999, by and between AFSG SECURITIES
CORPORATION ("AFSG"), a Pennsylvania corporation, and PFL LIFE INSURANCE COMPANY
("PFL"), an Iowa corporation, on its own behalf and on behalf the separate
investment accounts of PFL set forth in EXHIBIT A attached hereto and made a
part hereof (collectively, the "Account").
WITNESSETH:
WHEREAS, AFSG and PFL entered into an Underwriting Agreement on the
30th day of April, 1998 (the "Agreement") and desire to adjust certain
provisions of the Underwriting Agreement;
WHEREAS, the Account was established or acquired by PFL under the laws
of the State of Iowa, pursuant to a resolution of PFL's Board of Directors in
order to set aside the investment assets attributable to certain flexible
premium variable life insurance policies and certain flexible premium,
multi-funded life annuity contracts ("Contracts") issued by PFL;
WHEREAS, PFL has registered or will register the Account with the
Securities and Exchange Commission ("SEC") as a unit investment trust under the
Investment Company Act of 1940 (the "1940 Act") or will not register the Account
in proper reliance upon an exclusion from registration under the 1940 Act; and
WHEREAS, PFL has registered or will register the Contracts under the
Securities Act of 1933 (the "1933 Act") or that the Contracts are not registered
because they are properly exempt from registration under the 1933 Act or will be
offered exclusively in transactions that are properly exempt from registration
under the 1933 Act;
NOW, THEREFORE, the parties, intending to be legally bound, hereby
agree to amend the Underwriting Agreement as follows:
1. Exhibit A attached hereto and by this reference made a part hereof
replaces and supersedes Exhibit A of the Agreement.
2. All other terms and provisions of the Agreement not amended herein shall
remain in full force and effect. In the event of a conflict between the
Agreement and this Amendment, it is understood and agreed that the provisions of
this Amendment shall control.
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to
Principal Underwriting Agreement to be signed by their respective duly
authorized representative as of the day and year first above written.
AFSG SECURITIES CORPORATION PFL LIFE INSURANCE COMPANY
By: /s/ XXXX X. XXXXXXXXXX By: /s/ XXXXXXX X. XXXXXX
---------------------- ---------------------
Xxxx X. Xxxxxxxxxx Xxxxxxx X. Xxxxxx
Title: VICE PRESIDENT Title: PRESIDENT
-------------- ---------
2
EXHIBIT A
1. PFL Life Variable Annuity Account A
2. PFL Endeavor VA Separate Account
3. PFL Xxxxxx Variable Annuity Account
4. PFL Retirement Builder Variable Annuity Account
5. PFL Endeavor Target Account
6. PFL Variable Life Account A
3
