EXHIBIT (3)(ii)
SPECIMEN SELLING GROUP AGREEMENT.
GENERAL AGENCY AGREEMENT
IT IS HEREBY AGREED by and between PACIFIC FIDELITY LIFE INSURANCE COMPANY
("insurance Company") and FIDELITY INSURANCE AGENCY, INC. ("General Agent") as
follows:
I. APPOINTMENT
1. Subject to the terms and conditions of this Agreement, Insurance Company
hereby appoints General Agent to solicit applications for variable annuity
contracts which exclusively or primarily utilize investment companies advised by
Fidelity Management & Research Company, or its successors or assigns as their
investment medium ("Contracts" or "Fidelity annuities"). General Agent hereby
accepts such appointment.
2. The General Agent shall:
(a) Devote time and abilities to the establishment and maintenance of a
general agency for Insurance Company;
(b) Recruit, train and supervise insurance representatives in connection
with the sale of Fidelity annuities;
(c) Maintain proper records and accounts of business transacted under this
appointment, in such manner and form as may be reasonably required by
Insurance Company; and
(d) Render services to Contract Owners and beneficiaries of Contracts, as
reasonably required by Insurance Company; and generally endeavor to
promote the interests of Insurance Company as contemplated by this
Agreement.
II. THE CONTRACTS
1. Insurance Company proposes to issue and sell Contracts to the public.
General Agent agrees to provide sales services subject to the terms and
conditions hereof.
2. Contracts to be sold hereunder will be issued by Insurance Company
through a separate account.
3. Insurance Company shall file all necessary documents and applications in
the usual form and shall use its Best efforts to have declared effective
registration statements for Contracts under which shares of the Funds in the
Fidelity Group, as designated by General Agent, or shares of such other funds as
General Agent may designate, would serve as the investment medium. (It is
understood that no fund will be used as the investment medium unless Insurance
Company shall have consented thereto, which consent shall not be unreasonably
withheld.) Insurance Company shall not file any such documents and applications
or amendments thereto, however, without giving General Agent reasonable
opportunity to review and comment thereon in advance of such filings. such
filings may not be made without the consent of General Agent, which consent
shall not be unreasonably withheld.
Insurance Company shall submit Contracts for approval in all fifty states
and shall utilize its best efforts to secure variable annuity sales
qualifications in all states by December 31, 1980.
Insurance Company shall utilize its best efforts to maintain all such
qualifications, except as otherwise agreed between General Agent and Insurance
Company.
4. General Agent will receive insurance commissions from Insurance Company
for the sale of Contracts as set forth in Section 6, and will be responsible for
the payment of insurance commissions to any insurance subagents who sell
Contracts for General Agent. Such insurance commissions may be financed, and
such financing may be secured, by insurance commissions due or which will become
due to General Agent.
5. General Agent agrees that it will use its best efforts to make available
shares of Fidelity Daily Income Trust, Fidelity Cash Reserves, Fidelity
Government Securities, Fidelity Thrift Trust, Fidelity Corporate Bond Fund,
Inc., and Fidelity Aggressive Income Fund on a no load basis, as the investment
medium for Contracts. Shares of such other funds in the Fidelity Group or shares
of such other funds which General Agent may designate, and upon which the
parties shall mutually agree, may also be utilized with respect to all Fidelity
annuities for which General Agent shall serve as general agent hereunder.
6. Insurance Company will receive from the Contract Owners an annual
insurance premium on Contracts of 0.8% of the value of all amounts accumulated
under the Contract. Insurance Company shall pay to General Agent as insurance
commissions 68.75% of insurance premiums (0.55% out of the 0.8% insurance
premiums) 'received by it on Contracts. Insurance commissions shall be paid to
General Agent monthly in arrears, within ten days following the end of each
month.
7. General Agent will undertake a marketing program of reasonable size and
scope and will use its best efforts to implement this program. The size and
scope of the program shall be within the sole discretion of General Agent, and
such program may be halted if General Agent determines that market conditions
are improvident.
8. (a) General-Agent shall have the right to sell Fidelity annuities for
Insurance Company for a minimum two years after the effective date of the
offering of the Contracts (the "Offering"), provided that Insurance Company
shall be entitled to continue, in its present form, its program involving the
Lexington Funds. Insurance Company also reserves the right to establish separate
account(s) for the sales & service of variable annuity contracts sponsored by
Life Investors (on a load basis of 4% or greater). If the General Agent agrees
to the sale for Insurance Company of variable annuities other than the Fidelity
annuities, then any commissions paid on such other variable annuities shall be
under such terms and conditions as are then agreed to by Insurance Company and
General Agent. For the purposes of this Section 8, the term variable annuity
will include a fixed annuity which is sold with the same contract as a variable
annuity.
(b) If this Agreement is cancelled by General Agent, then General Agent
agrees that for a period of two years following such cancellation, it will not
knowingly solicit any Fidelity Contract holders either to terminate or exchange
their existing Contract for the variable annuity contract offered by any other
insurance company.
9. (a) The arrangement between General Agent and Insurance Company is
cancellable by either pa rty on six months prior written notice, provided that
such cancellation shall not become effective prior to the termination of the
initial 24 months of this Agreement. After cancellation, payments of
insurance~commissions referred to in Section 6 to General Agent shall continue
to be made by Insurance Company for any Contracts written prior to cancellation,
including any future payments on contracts written prior to cancellation.
(b) (i) In the event that Insurance Company shall reasonably determine
that its continued engagement in the sale of variable annuity contracts is not
permitted by applicable laws, rules, or regulations, then Insurance Company
shall be entitled upon 90 days' prior written notice to General Agent to
terminate this arrangement with the same force and effect as if terminated under
Section 9(a).
(ii) In no event shall Insurance Company be entitled to effect any
termination under this Section 9(b) if it engages in the sale of variable
annuities through others. If Insurance Company effects any such termination, it
will not engage in the variable annuity business for a period of two years,
other than through the reservation set forth i in Section 8 (a]
10. The assets underlying the Contracts will be held in a separate
account(s) of Insurance Company which shall not be chargeable with liabilities
arising out of any other business of Insurance Company. This provision will be
included in all applicable agreements and filings made in connection with the
Offering of the Fidelity annuities.
11. Insurance Company acknowledges that for purposes of solicitation, the
names of Fidelity Contract holders belong to General Agent and Insurance Company
will in no event knowingly solicit Fidelity Contract holders except with General
Agent's express written consent. The provisions of this Section shall survive
any cancellation of this Agreement.
12. The name(s) of the separate account(s) through which the Fidelity
annuities are offered and sold will include "Fidelity," if General Agent so
desires.
13. Shares only of such companies as are expressly approved by General
Agent and Insurance Company may be substituted as the investment media of the
Fidelity annuities. Notwithstanding any termination of the Agreement, only
securities designated by General Agent will serve as the investment medium of
the Fidelity annuities in accordance with the provisions of Section 5 and only
such securities as are specifically approved by General Agent and Insurance
Company may be substituted as the investment medium of such Fidelity annuities
in accordance with the provisions of this Section 13, provided that,
notwithstanding the foregoing, Insurance Company may take other action acting as
a fiduciary in its fiduciary capacity, with respect to any company whose
securities form part of the investment media, (a) if required by the SEC, or (b)
if the SEC shall have issued a final stop order, which has not been rectified
within a period of 30 days with respect to such company, or (c) if any required
registration under the Securities Act of 1933 of such company is not able to
become effective, or (d) if any such security or company is subject to a
judgment or decree by any court of competent jurisdiction finally revoking or
suspending the registration of such security or company under the Securities
Act, or (e) if such company whose securities form part of the investment media
is permanently enjoined from engaging in business or issuing its securities, or
(f) if such company files petitions in bankruptcy or receivership or fails to
vacate within 30 days any involuntary bankruptcy petition against it.
14. General Agent will bear the cost of advertising promotional and sales
literature, including costs of typesetting and printing the Fidelity Annuity
prospectus of marketing General Agent will also supply, at no cost to Insurance
Company, prospectuses of the eligible Fidelity funds in which the assets Of
Fidelity Contract holders will be invested. Insurance Company agrees that it
will not disseminate any advertising, promotional or sales literature relating
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to Fidelity annuities without first obtaining the express written consent of
General Agent. If insurance company undertakes to
produce sales literature at the expense of General Agent, such literature may be
printed only with such printers on such terms and conditions and at such vices
as agreed to by General Agent.
15. This Agreement may be assigned by General Agent to any majority
owned subsidiary of FMR Corp. or Fidelity Management & Research Company which
has the word "Fidelity" in its name. If either of the above companies shall
propose to sell any interest in General Agent or in any assignee, then prior
thereto it shall cause General Agent or such assignee to assign its rights and
obligations under this Agreement to an assignee permitted under the preceding
sentence. If Insurance Company shall merge or sell all or substantially all of
its assets, the successor shall assume and succeed to all rights and obligations
of Insurance Company under this Agreement.
16. In order to effectuate the offer and sale of Fidelity annuities,
Insurance Company will use its best efforts to license as its agents those
individuals designated by General Agent. General Agent shall bear out pocket
license fees. Insurance Company shall maintain appropriate records relating to
licensing and shall bear any and all costs relating to required
countersignatures by resident agents.
17. During the period of this Agreement and thereafter, Insurance Company
will proportionately vote the shares of the eligible funds held in the variable
account(s) at meetings of the shareholders of those funds in accordance with
instructions from the Contract owners, unless a different method of voting
proposed by Insurance Company is deemed permissible by the SEC and General Agent
agrees that such different method be used.
III. DISTRIBUTION
1. General Agent is hereby authorized to enter into separate agreements
with broker/dealers registered under the Securities Exchange Act of 1934 to
participate in the distribution of Contracts, as General Agent shall deem
appropriate. Insurance Company reserves the right to review and accept or
reject, on a reasonable basis, all applications for Contracts. All payments for
such Contracts shall be sent to the office designated for such by Insurance
Company.
2. On behalf of the separate account(s) issuing the Contracts, Insurance
Company shall furnish General Agent with copies of all information, financial
statements and other documents which General Agent reasonably requests for use
in connection with the distribution of Contracts. General Agent shall be
responsible for the costs of typesetting and printing the variable annuity
prospectus. General Agent shall provide to Insurance Company, at General Agent's
expense, such number of copies of the currently effective annuity prospectus as
Insurance Company shall reasonably require. In the event Insurance Company
undertakes to print such prospectuses at General Agent's expense, such
prospectuses may be printed only with such printers on such terms and conditions
and at such prices as xxxx to by General Agent.
3. General Agent is not authorized to give any information, or to make any
representations concerning the variable accounts or Insurance Company contrary
to those contained in the current registration statement of prospectus filed
with the SEC or in the sales literature.
IV. MISCELLANOUS
1. Each party to this Agreement (indemnifying party) agrees to release and
hold harmless the other party, its officers, directors, agents, representatives,
employees, successors or assigns from any claims or liabilities arising out of
the breach of this Agreement by the indemnifying party, or
arising out of acts or omissions of the indemnifying party not authorized by
this Agreement, including violation of the Federal securities laws
2. Upon reasonable demand and during reasonable business hours, either
party shall have the right to examine any and all of each other's books and
records and the auditors' reports thereon pertaining to business for which
General Agent has received or may receive commissions under this Agreement
3. This Agreement shall be governed by the internal laws of the
Commonwealth of Massachusetts, and may not be modified without the written
consent of both parties hereto.
4. This Agreement shall be binding upon the successors or assigns of each
of the parties.
5. This Agreement is the sole instrument which governs the relationship of
the parties in respect of the subject matter hereof.
6. All notices, requests, demands and other communications 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
on the date of mailing if sent Registered or Certified, postage prepaid and
properly addressed as follows:
TO INSURANCE COMPANY:
Pacific Fidelity Life Insurance Company
0000 Xxxxxxxx Xxxx X.X.
Xxxxx Xxxxxx, Xxxx 00000
Attn: Xxxxxx X. Xxxxxx
TO GENERAL AGENT
Fidelity Insurance Agency, Inc.
00 Xxxxxxxxxx Xxxxxx
Xxxxxx, Xxxxxxxxxxxxx 00000
Attn: Xxxxxx X. Xxxxxx, Clerk
IN WITNESS WHEREOF, the parties hereto have caused this instrument to be
signed on their behalf by their respective officers "there unto duly authorized.
EXECUTED THIS 30TH day of July,1980.
PACIFIC FIDELITY
LIFE INSURANCE COMPANY
Attest: /s/ BY: /s/
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Assistant Secretary Executive Vice President
FIDELITY INSURANCE AGENCY, INC
Attest: /s/ BY: /s/
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Clerk President
