BROKER DEALER SELLING AGREEMENT
BROKER DEALER SELLING AGREEMENT
This Broker-Dealer Selling Agreement (hereinafter “Agreement”) is made by and between PRUCO SECURITIES, LLC (hereinafter "Distributor"), The Prudential Insurance Company of America (hereinafter “Prudential”), Pruco Life Insurance Company (hereinafter “PLIC) and Pruco Life Insurance Company of New Jersey (hereinafter “PLNJ”), (hereinafter, the preceding three entities referred to collectively as the “Company”), and Broker Dealer (hereinafter "Broker-Dealer"), and together with Broker-Dealer’s duly licensed affiliates set forth on the Schedule A, attached hereto and made a part hereof (hereinafter the “Affiliates”)
Whereas, Company is an issuer of
variable life contracts (hereinafter “Contracts”) identified on attached
Schedule B and have appointed Distributor as the sole principal underwriter of such
Contracts; and
Whereas, Company is also an issuer of certain traditional
life policies that are not considered securities under the federal securities laws
(hereinafter “Policies”), which Policies are identified on attached Schedule
B: and
Whereas, the Contracts are duly registered under the Securities Act of 1933, as amended (hereinafter “Securities Act”), or private placement variable contracts which are exempt from registration under the Securities Act and qualified under applicable insurance laws, and the Policies are not registered under the Securities Act and are duly qualified under applicable insurance laws; and
Whereas, Distributor, Company, and Broker-Dealer wish to enter into an agreement to have Broker-Dealer solicit application
for Contracts; and Company and Broker-Dealer wish to enter into an agreement to
have Broker-Dealer solicit applications for Policies.
Now, therefore, for
good and valuable consideration, the sufficiency of which is acknowledged hereby,
and intending to be legally bound, the parties agree as follows:
I. Appointment/Authorization
Pursuant to the authority delegated to it by the Company, Distributor hereby authorizes Broker-Dealer, and/or the Affiliates during the term of this Agreement, to solicit applications for Contracts. Additionally, the Company hereby appoints Broker-Dealer and/or its Affiliates during the term of this Agreement as a non-exclusive agent to solicit applications for Policies. Such Contracts and Policies are identified as Eligible Products in a List of Eligible Products that is identified as Schedule B, attached hereto and made a part hereof. Distributor or the Company may update or amend Schedule B, which will be effective upon notice, as defined in Section XX, (hereinafter, “Notice”) to the Broker-Dealer that a new or amended Schedule B has been issued. It is agreed and understood by the parties that Distributor does not distribute nor act in any capacity with respect to Policies and the Broker-Dealer and its Affiliates, if any, shall have no arrangement with Distributor with respect to such Policies.
| II. | Authority and Undertakings of the Broker-Dealer | ||||
| A. | With regard to Contracts and Policies, Broker-Dealer is authorized hereby to: | ||||
| 1. | solicit, procure
and submit applications for Contracts of the Company through Registered Representatives
(defined below), provided that both the Broker-Dealer (and/or the Affiliates) |
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and the Registered
Representatives are properly licensed, registered and state appointed to do so,
in accordance with applicable laws and regulations and the Company’s Licensing,
Appointment and Registration policy, as amended from time to time. “Registered
Representative” is defined as a duly registered representative of Broker-Dealer,
in good standing, with the authority to sell Contracts as required by the Financial
Industry Regulatory Authority, Inc. (hereinafter “FINRA”) and who is appointed
as a non exclusive agent of the Company and properly licensed and appointed in accordance
with applicable laws and regulations and the Company’s Licensing, Appointment
and Registration policy, as amended from time to time. |
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| 2. | solicit, procure
and submit applications for Policies of the Company through Registered Representatives
or through Brokers (defined below), provided that both the Broker-Dealer (and/or
the Affiliates) and either the applicable Registered Representative or Broker are
properly licensed and state appointed to do so, in accordance with applicable law
and regulations and the Company’s Licensing, Appointment and Registration policy,
as amended from time to time. For purposes of this agreement, “Broker”
is defined as an individual employed by or associated with Broker-Dealer who is
not a Registered Representative of Broker-Dealer and who is appointed as a non-exclusive
agent of the Company. |
| B. | Broker-Dealer
agrees to the following undertakings in its capacity as a Broker-Dealer with regard
to its Registered Representatives and Brokers for Contracts and Policies: |
| 1. | Broker-Dealer
has full responsibility for the training and supervision of all Registered Representatives
and Brokers who are engaged, directly or indirectly, in the offer, sale and/or administration
of Contracts and Policies to ensure that they are in compliance with all applicable
federal, state and local laws and regulations and all rules and procedures of the
Company (which rules and procedures may be changed by the Company at its own discretion.)
Broker-Dealer shall establish and implement reasonable procedures for periodic inspection
and supervision of sales practices of its Registered Representatives. Additionally,
Broker-Dealer shall establish, maintain, and enforce a supervisory system, as set
forth by FINRA Conduct Rules, to supervise the activities of each Registered Representative
and Broker that is reasonably designed to achieve compliance with applicable securities
laws and regulations, and with the applicable rules of FINRA. |
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| 2. | Broker-Dealer
shall be responsible for determining the suitability for recommendations and sales
for Registered Representatives and Brokers of Contracts and Policies. Broker-Dealer
shall be solely responsible for determining the suitability of recommendations for
purchases and sales of Contracts that are made by its Registered Representatives.
Broker-Dealer shall take steps to ensure that Registered Representatives appointed
by it shall not make recommendations to an applicant to purchase a Contract in the
absence of reasonable grounds to believe that the purchase of the Contract is suitable
for such applicant, in accordance with applicable laws and regulations including
FINRA Rules, regulations and administrative policies. |
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| 3. | Broker-Dealer
shall be responsible for the delivery of all Contracts and Policies, amendments
thereto and all other documents to each Contract and Policy owner, and shall ensure
that all |
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other delivery
requirements have been satisfied, promptly and in accordance with the Company’s
delivery requirements; require return of unplaced Contracts and Policies; review
all applications before submitting them to the Company and will submit only those
applications that have been properly completed and for which Broker-Dealer or its
Affiliates, Registered Representatives and Brokers have the licenses and appointments
required by the Company. |
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| 4. | Broker-Dealer
is authorized to designate Registered Representatives and Brokers for appointment
by Company to solicit applications for Contracts and Policies. Broker-Dealer shall
not propose a Registered Representative or Broker for appointment unless he or she
duly is licensed as an insurance agent in the state(s) in which it is proposed he
or she shall solicit applications for Contracts and/or Policies and, if he or she
is to sell Contracts, is a registered representative of Broker-Dealer. Broker-Dealer
shall assist the Company in the appointment of Registered Representatives and Brokers
in conformance with applicable insurance laws and such rules and procedures as may
be established by Company. Broker-Dealer shall conduct a thorough and diligent investigation
of the trustworthiness, competence, character, reputation and criminal background
of each Registered Representative or Broker that satisfies the requirements for
appointment of an agent in each state the individual is to be appointed, the Violent
Crime Control and Law Enforcement Act of 1994 (18 U.S.C. Sect. 1033 and 1034) (hereinafter
the “Crime Xxxx”) and, as applicable, federal securities regulations and
FINRA rules prior to proposing them for appointment and any other applicable laws.
Broker-Dealer shall recommend for appointment only those Registered Representatives
or Brokers known to be of good character, trustworthy, financially responsible and
competent to serve as an agent for Company, and who otherwise qualify for appointments
under the applicable state insurance laws when proposed for appointment. Additionally,
the Broker-Dealer shall notify the Company immediately if the Broker-Dealer has
knowledge that any person who was recommended for appointment and who was appointed
by the Company no longer meets the qualification requirements of applicable state
insurance laws. The Company shall have sole discretion to appoint, refuse to appoint,
discontinue, or terminate the appointment of any Registered Representative or Broker.
Upon the Company giving Notice to Broker-Dealer of its withdrawal of authority of
a Registered Representative or Broker to solicit applications, Broker- Dealer will
immediately ensure that any such Registered Representative or Brokers cease all
such activities. |
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| 5. | Broker-Dealer
shall assist Contract and Policy owners in obtaining prompt service from the Company
with respect to the administration of Contracts and Policies and in maintaining
their coverage. |
| III. | Limitations of Broker-Dealer’s Authority | ||||
Broker-Dealer’s authority is limited to what is authorized in Section II. This Section is intended to provide examples, not an entire listing of actions that are outside the authority granted in Section II. Broker-Dealer agrees that its authority is limited to the solicitation and marketing of Contracts or Policies in accordance with this Agreement. Broker-Dealer represents and agrees on behalf of itself, its Registered Representatives, Brokers and Affiliates that none of them will act in a manner not authorized by this
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Agreement and that any such unauthorized actions, including but not limited to, the following actions, would be considered a breach of this Agreement:
| A. | make, alter,
modify or discharge any Contract or Policy or other form; waive any provision or
condition of a Contract or Policy; bind the Company; extend the time of paying any
premium; accept or receive promissory notes for payment of premium. |
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| B. | adjust or
settle any claim, or commit the Company or Distributor with respect to any claim,
incur any expense or liability on account of the Company or Distributor except as
specifically directed or authorized in writing by the Company or Distributor. |
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| C. | expend, nor
contract for the expenditure of the funds of Company or Distributor, nor incur any
liability on behalf of Company or Distributor, without specific written authority
to do so from the Company or Distributor. |
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| D. | make representations
as an agent of the Company or Distributor in any manner or for any purpose except
as specifically authorized by this Agreement. |
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| E. | provide or
offer to provide any inducement not specified in the Contract or Policy or any rebate,
either directly or indirectly, to any person or entity, as an inducement to purchase
any Contract or Policy. |
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| F. | obtain signed
forms from applicants or Contract/Policy owners unless the forms are completed for
submission to the Company. Registered Representatives or Brokers may not request
that an applicant or Contract/Policy owner pre-sign any Contract or Policy form
for use at a later date. |
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| G. | deliver or
allow the delivery of a Contract or Policy unless the health of the proposed insured(s)
is in accordance with the Company’s requirements, if any, and, where required,
the first premium is paid in full. |
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| H. | make any misrepresentation
or incomplete comparison for the purpose of inducing a potential or actual Contract
or Policy owner to purchase, convert, lapse, surrender all or any portion of, forfeit,
borrow from, or replace any Contract or Policy; |
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| I. | induce or
attempt to induce any Contract or Policy owner to replace or relinquish a Contract
or Policy or to withdraw values from a Contract or Policy when doing so would be
in violation of the Company’s Replacement Policy or any state or federal law
or regulation or not in the interest of the customer. |
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| J. | accept any
payments for Contracts or Policies, unless the funds are made payable to the Company
as provided in Section VIII. |
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| K. | engage in
any insurance transaction that requires compensation disclosure, as determined by
the applicable law, without making such required compensation disclosure. |
| IV. | Broker-Dealer Representations | ||||
Broker-Dealer represents and agrees on behalf of itself, its Registered Representatives and Brokers:
| A. | that solicitation
and all activities by Broker-Dealer shall be undertaken only in accordance with
applicable laws and regulations. No Registered Representative or Broker of Broker-Dealer
shall |
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solicit applications
for Contracts or Policies until the Registered Representative, Broker and Broker-Dealer
or its Affiliates are duly licensed and appointed by Company in accordance with
applicable laws and regulations and in accordance with the Company’s Licensing,
Appointment, and Registration Policy, in the appropriate states or other jurisdictions. |
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| B. | that neither
it nor its Registered Representatives or Brokers are authorized by Distributor or
Company to give any information or make any representation in connection with this
Agreement or the offering of the Contracts or Policies other than those contained
in the prospectus, if applicable, or other solicitation material authorized in writing
by Distributor or Company. |
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| C. | to abide by
the Company’s policies and procedures related to the solicitation and sale
of Contracts and Policies, which are identified on Schedule C attached hereto and
made a part thereof. |
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| D. | that it is
a registered broker-dealer under the Securities Exchange Act of 1934, as amended,
(hereinafter “1934 Act”) and a member in good standing of FINRA, and that
its Registered Representatives who will be soliciting applications for the Contracts
will be duly registered representatives of Broker-Dealer. Furthermore that each
one will be a registered representative in good standing, with authority to sell
the Contracts as required by FINRA. |
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| E. | that, except
as disclosed to the Company on Broker-Dealer’s, Registered Representatives’ or Brokers’ application for appointment or otherwise in writing, neither
Broker-Dealer’s insurance license nor the insurance license of Registered Representative
or Broker has ever been revoked, suspended, or rescinded in any state or jurisdiction;
neither Broker-Dealer nor any Registered Representative or Broker has ever been
fined by any insurance regulator in an amount of $15,000 or more; and neither Broker-Dealer
nor any of its Registered Representatives or Brokers are currently the subject of
any disciplinary proceeding or investigation in any state or jurisdiction by any
Department of Insurance, Attorney General’s office or other government authority. |
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| F. | that, except
as disclosed to the Company on Broker-Dealer’s, Registered Representatives’ or Brokers applications for appointment or otherwise in writing, if Broker-Dealer
or any of its Registered Representatives or Brokers are or have ever been a registered
principal or representative of a member of FINRA, the said registration with FINRA
is not now and never has been suspended, revoked or canceled; that neither Broker-Dealer
nor any of its Registered Representatives and Brokers have ever been fined by FINRA
or other self-regulatory organization in an amount of $15,000 or more; that neither
Broker-Dealer nor any of its Registered Representatives or Brokers are currently
the subject of any disciplinary proceeding or investigation by the SEC or FINRA;
that neither Broker-Dealer nor any of its Registered Representatives or Brokers
have ever been convicted of any criminal felony involving dishonesty or breach of
trust or of any other offense set forth in the Crime Xxxx ; that Broker Dealer performs
the due diligence required by law to ensure that Broker Dealer, its officers, directors,
employees engaging in the business of insurance, Registered Representatives and
Brokers are, and for the term of this Agreement shall continue to be, in compliance
with the requirements of the Crime Xxxx. |
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| G. | that Broker-Dealer,
upon request of Distributor and/or Company, shall, within thirty (30) days of receipt,
return to Distributor a questionnaire or certification regarding any regulatory,
civil and/or criminal proceedings, including arbitration, against the Broker-Dealer
or any Registered |
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Representative
or Broker commenced or concluded by any state insurance or securities department,
FINRA, the SEC, or other self-regulatory organization, and/or in any court of competent
jurisdiction during the twelve (12) month period prior to the date of the questionnaire
or certification. Broker-Dealer shall provide Distributor with a full explanation
regarding matters disclosed in the questionnaire or certification. Broker-Dealer
also agrees to send to Distributor, if requested by Distributor, copies of all Disclosure
Reporting Forms applicable to Registered Representatives authorized to solicit applications
for and sell the Contracts simultaneously with filing such forms with FINRA. Additionally,
Broker-Dealer shall notify Distributor of any regulatory investigation, fine or
sanction concerning an individual or firm who is authorized to represent Distributor
or Company under this Agreement. |
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| H. | that neither
Broker-Dealer nor any of its Registered Representatives or Brokers will solicit
applications for Contracts or Policies in any state, jurisdiction or commonwealth
unless the Contract or Policy has been approved for sale by the appropriate regulatory
authority in that state, jurisdiction or commonwealth. |
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| I. | that Broker-Dealer
shall furnish the Company with proof of proper insurance licensing for itself and
its Affiliates, and its Registered Representatives and Brokers and its Affiliate’s Brokers. Broker- Dealer will also notify the Company in writing immediately
of the termination of the employment or affiliation of a Registered Representative
or Broker who is appointed to represent the Company pursuant to this Agreement. |
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| J. | that with
regard to life insurance Contracts and Policies Broker-Dealer agrees to submit to
the Company cases from Broker-Dealer which have been packaged for underwriting purposes.
Such case packages should include the application, a copy of the as-sold illustration,
all relevant financial information, and either copies of relevant attending physicians’ statements and other required medical information or a listing of the medical
underwriting requirements Broker-Dealer has ordered. Broker-Dealer further agrees
to submit informal or inquiry case packages for underwriting purposes that include
only the relevant information needed to assess the risk; that in obtaining and assembling
this information it is acting as the representative of the applicant, proposed insured
and not as an agent of the Company. |
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| K. | that Broker-Dealer
agrees that all terms and conditions of this Agreement apply to Broker-Dealer, any
Affiliate of Broker-Dealer that is set forth in Schedule A, and any Registered Representative
or Broker of Broker-Dealer or any Affiliate who solicits applications for Contracts
and Policies on behalf of Broker-Dealer or its Affiliate; Broker-Dealer further
agrees to ensure that such Registered Representatives, Brokers and Affiliates comply
with all terms and conditions of this Agreement. Furthermore, Broker-Dealer agrees
to notify Company immediately if Broker-Dealer, its Registered Representatives,
Brokers or Affiliates breach any terms and conditions of this Agreement. |
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| L. | that no Contract
or Policy shall be sold or used in any manner to or with a viatical or life settlement
company or be part of a viatical or life settlement. |
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| M. | that submission
of an application for a Contract or Policy is proof that a registered principal
of the Broker-Dealer has approved the transaction in accordance with FINRA rules. |
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| N. | that for any
Contract, Broker-Dealer warrants that the solicitation will be made by use of currently
effective prospectus for the Contract and the underlying funds and if required by
state law, the Statement of Additional Information for the Contract; that the prospectus
will be delivered concurrently with each sales presentation and that no statements
shall be made to a client that are inconsistent with any statement made in the prospectus. |
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| O. | that Broker-Dealer
shall pay all expenses incurred by it in the performance of this Agreement unless
specifically provided for in this Agreement or in a writing signed by the Company
and/or Distributor and Broker-Dealer. |
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| P. | that with
regard to any bank marketing, Broker-Dealer will comply with the disclosure and
advertising requirements implemented by the Board of Governors of the Federal Reserve
System, the Federal Deposit Insurance Corporation, the Office of the Comptroller
of the Currency, the Office of Thrift Supervision and all other applicable laws
and requirements, including but not limited to disclosures with respect to the sale
or recommendation of Contracts and Policies, marketing material and illustrations. |
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| Q. | that Broker-Dealer
shall notify Distributor and/or Company prior to recommending a Registered Representative
for appointment, if that Registered Representative has been placed under heightened
supervision by the Broker-Dealer. |
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| R. | to complete
a permanent registration for the PrudentialXpress website at xxx.xxxxxxxxx.xxx (hereinafter
the “Website”) within 30 days of the effective date of this Agreement.
Use of the Website will be subject to the terms and conditions of the Website. |
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| S. | for the term
of the Agreement to access the Website no less frequently than once every 90 days
and to read and review the “Notices & Schedules” page of the Licensing
Section. |
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| T. | for the term of the Agreement, to maintain
an active Website registration. |
| V. | Independent Contractor | ||||
Broker-Dealer is an independent contractor under this Agreement. Nothing herein contained shall make Broker-Dealer, or any Registered Representative or Broker, an employee of Company or Distributor. Neither Broker-Dealer nor its Registered Representatives or Brokers, shall hold themselves out to be employees of Company or Distributor in any dealings with the public. Broker-Dealer, its Registered Representatives and Brokers are free to exercise independent judgment as to the time, place and means of performing the authority granted, subject to the terms and conditions of this Agreement. Broker-Dealer’s business and any services provided by Broker-Dealer, its Registered Representatives or Brokers, other than those authorized by this Agreement, are not and will not be represented to be the business of the Company.
| VI. | Obligations Of The Company And Distributor | ||||
| A. | Company and
Distributor reserve the right at any time, and without notice to withdraw and limit
the offering of Contracts or Policies or interest in any accounts relating thereto. |
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| B. | Distributor,
during the term of this Agreement, will advise Broker-Dealer of the issuance by
the SEC of any stop order with respect to the registration statements or any amendments
thereto or |
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the initiation
of any proceedings for that purpose or for any other purpose relating to the registration
and/or offering of the Contracts and of any other action or circumstance that may
prevent the lawful sale of any Contract in any state or jurisdiction. |
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| C. | During the
term of this Agreement, Distributor shall promptly advise Broker-Dealer of any amendment
to any registration statement or any amendment or supplement to any prospectus included
within the registration statement. |
| VII. | Sales, Advertising And Marketing Materials | ||||
Broker-Dealer agrees that any material it
develops, approves or uses for sales, training, explanatory or other purposes that
mentions by name the Contracts or Policies, the Distributor or the Company (or an
affiliate of the Company or any logos of any of them) will not be used without the
prior written consent of the appropriate party (Company or Distributor). Broker-Dealer,
its Registered Representative or Brokers will not publish, issue, circulate, or
use in any manner whatsoever any advertisements or marketing materials describing
or referring to the Company or Distributor, the Contracts or the Policies, or any
product of the Company unless such advertisements or marketing materials have been
approved in writing in advance by the appropriate party (Company or Distributor)
and such approval has not been withdrawn.
Broker-Dealer, its Registered Representatives
and Brokers will not misrepresent the Contracts or Policies or the Company and Distributor
and will make no oral or written representation which is inconsistent with the terms
of the Contracts or Policies or with the information in any illustration or sales
literature furnished by the Company.
| VIII. | Payments | ||||
| A. | Neither Broker-Dealer
nor its Registered Representatives or Brokers can accept cash or any other form
of payment made payable to the Broker-Dealer or any Registered Representative or
Broker. |
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| B. | Broker-Dealer
may accept a check or money order made payable to the Company, but only for Contracts
and Policies and under the following circumstances: |
| 1. | when the application
and the check are submitted simultaneously and the Company’s standards for
prepaid applications have been met, or |
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| 2. | the Company’s delivery requirements have been met and the Contract or Policy has been delivered. |
| C. | The check
or money order must be forwarded to the Company within one business day of receipt
by the Broker-Dealer, its Registered Representative or Broker. |
| IX. | Compensation | ||||
| A. | Company shall
arrange for the payment of compensation to Broker-Dealer or its Affiliate, if applicable,
as compensation for the sale of Policies by a Registered Representative or Broker
of Broker-Dealer. With respect to sales of Contracts by a Registered Representative
of Broker-Dealer, Distributor shall cause Company to arrange for the payment of
compensation to Broker-Dealer or its Affiliate, if applicable and allowable under
federal law. The amount of compensation payable under this section (hereinafter
“Compensation”) shall be in accordance with the Company’s Commission
Schedule in effect as of the date of issue, as determined by the Company |
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for each Contract
or Policy. If the Company determines the Broker-Dealer is eligible for any expense
allowances or a Compensation arrangement that differs from the commission schedules
posted to the Website, such Compensation will be communicated to the Broker-Dealer
in writing in a separate Schedule. No Compensation is payable unless the Broker-Dealer
and the Registered Representative or Broker have first complied with all applicable
insurance laws, rules and regulations and such payments would not constitute a violation
of such insurance laws, rules and regulations, anything in this Agreement to the
contrary notwithstanding. The Broker-Dealer or Affiliate will only be entitled to
compensation for Contracts or Policies that have been submitted by the Broker-Dealer,
accepted by the Company, delivered to the Contract or Policy owner and where all
the requirements of the Company’s Licensing, Appointment and Registration Policy
have been satisfied (hereinafter “Contracts/Policies Placed by Broker-Dealer”). |
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| B. | If the Company
returns, for any reason, any premiums or purchase payments on any Contract or Policy,
the Broker-Dealer will have an immediate obligation to, and will upon demand, repay
the Company all the Compensation previously paid to the Broker-Dealer or its Affiliate
as a result of those premiums or purchase payments. |
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| C. | The Company
shall have and be entitled to exercise a right of offset for any amounts due the
Company, or any affiliate of the Company, from Broker-Dealer against any and all
Compensation otherwise payable to Broker-Dealer under this Agreement. |
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| D. | When two or
more Broker-Dealers are involved in a sale, Compensation will be payable in proportion
as directed on the application or in a writing acceptable to the Company. |
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| E. | No further
Compensation is payable to the Broker-Dealer or Affiliates after the Contract sold
by the Broker-Dealer has lapsed, or after the discontinuation of premium payments,
but should the Broker-Dealer secure the reinstatement of the Contract, while properly
licensed to do so, the Company will pay compensation to the Broker-Dealer on premiums
collected, as though the Contract had not lapsed. With regard to a Contract not
sold by the Broker-Dealer, but where the Broker-Dealer secures the reinstatement
and signs the reinstatement form, if the time between the lapse and reinstatement
is less than three months, no compensation shall be payable to the Broker-Dealer.
However, if the time between the lapse and the reinstatement is greater than three
months, all compensation (current and future) shall be payable to the Broker-Dealer
based upon the original issue date of the Contract. |
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| F. | No compensation
will be paid on any premium that is waived. |
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| G. | If a Contract
or Policy replaces, in whole or in part, a policy or contract or annuity contract
previously issued by this Company, the Company has the right to determine what,
if any, compensation will be allowed. |
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| H. | No Compensation
will be paid on any Policy or Contract issued as a result of the conversion of group
life insurance. |
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| I. | Compensation
set forth in the Schedule D of this Agreement is subject to change at any time upon
Notice to Broker-Dealer. Changes will not affect Compensation for any Contract or
Policy placed prior to the effective date of the change. |
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| J. | Service Compensation,
if applicable as defined in Schedule D, shall be payable for the period and upon
the terms set forth in Schedule D. |
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| K. | No assignment
of Compensation is valid against the Distributor and/or Company unless directed
by Broker-Dealer and agreed upon by Distributor and/or Company and unless allowable
under all applicable laws. |
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| L. | No Compensation
is payable on any extra war risk premium which may be charged in connection with
any Contract or Policy. |
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| M. | If a Contract
or Policy is changed to a different kind or amount, or if its date is changed, the
Company will recalculate Compensation as of the date of the change. Additional Compensation
will be paid or recaptured as a result of this calculation. |
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| N. | Compensation
on premiums paid more than three months in advance are payable on the date the premiums
are due. |
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| O. | No compensation
shall be paid, and any compensation previously paid shall be returned to the Company
or Distributor on request, if the Company or Distributor, in its sole discretion,
determines not to issue the Contract(s) or Policy(s) applied for, refunds the premium
paid pursuant to any request by the Contract or Policy owner, refunds any premium
paid as the result of a complaint by the Contract or Policy owner, or determines
that any person or entity required to be licensed for the solicitation of Contracts
or Policies is not duly licensed to sell such Contracts or Policies in the appropriate
jurisdictions. |
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| P. | Upon the termination
of this Agreement, the Company will pay Compensation to the Broker-Dealer or its
Affiliate on any renewal Compensation which would otherwise be due on business placed
with Company prior to the termination date of this Agreement unless such receipt
of renewal Compensation is determined to violate current directives to the contrary
as provided by FINRA, state or federal law or regulation or a court of competent
jurisdiction. |
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| Q. | Compensation
due is vested to the Broker-Dealer for the period set forth in the attached Schedule
D and if such receipt of Compensation is permitted by applicable state and federal
law. |
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| R. | If any withdrawals
are made from any Contract during the first twelve months of the Contract, Company
will recapture Compensation attributable to the withdrawal of the premium, but not
attributable to the withdrawal of the earnings on the premium. |
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| S. | Notwithstanding
any provision of this Agreement to the contrary, if the transaction is subject to
the jurisdiction of the New York Insurance Department, no Compensation in excess
of the compensation limits established by the Insurance Law of the State of New
York will be due or payable by the Company to Broker-Dealer or its Affiliates. |
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| T. | The Company will determine the amount of Compensation payable for a Contract and Policy placed by Broker-Dealer, which was not included in Schedule D at the time of sale. |
| X. | Books And Records | ||||
Broker-Dealer shall have the responsibility for maintaining its records and the records of its Registered Representatives, Brokers and Affiliates. Broker-Dealer shall maintain such other records as are required of
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it by applicable federal and state laws and regulations and FINRA rules. These records will be made available to the Distributor and Company for inspection upon request, including after termination of this Agreement. The books and records maintained by Broker-Dealer under the terms of this Agreement that relate to the sale of the Contracts and Policies, shall be maintained so as to clearly and accurately disclose the nature and details of the transactions as required by appropriate laws, rules and regulations and for the period required by law. Broker-Dealer and its Registered Representatives, Brokers and Affiliates shall also comply with any record hold order issued by the Company.
| XI. | Complaints And Investigations | ||||
| A. | Broker-Dealer
shall promptly provide Notice to Company and Distributor of any written complaint
or inquiry or
notice of any investigation or proceeding (customer, regulatory, judicial or otherwise) received by
Broker-Dealer (or any Registered Representative or Broker) that relates to any Contract or
Policy or any activities undertaken in connection with this Agreement. |
|||||
| B. | The parties
jointly agree to cooperate fully with respect to any complaint, inquiry, investigation
or proceeding
(customer, regulatory, judicial or otherwise) arising in connection with this Agreement, including,
but not limited to, any related customer complaint, securities or insurance regulatory investigation
or proceeding or judicial proceeding. |
|||||
| C. | Broker-Dealer
shall promptly provide Notice to Company and Distributor describing the handling
or determination
in connection with any written complaint, inquiry or investigation proceeding described
in paragraph A of this section. |
|||||
| XII. | Term of Agreement; Suspension; Termination; Survival | |||||
| A. | This Agreement
shall be in force from its Effective Date and thereafter shall remain in force,
except that either
party may unilaterally terminate this Agreement upon thirty (30) days’ Notice to the other party of its
intention to do so. |
|||||
| B. | This Agreement
may be terminated for cause by the Company and/or Distributor for, but not limited to,
any of the following reasons: |
|||||
| 1. | fraud by Broker-Dealer,
Registered Representatives or Brokers; |
||
| 2. | material misrepresentations
by Broker-Dealer, Registered Representatives or Brokers regarding the Company, Distributor,
or the Company’s products, or the performance of either; |
||
| 3. | conversion
of funds by Broker-Dealer; |
||
| 4. | breach of
this Agreement; |
||
| 5. | the suspension,
revocation, cancellation or rescission of any state insurance license or FINRA license
or registration of Broker-Dealer, Registered Representatives or Brokers; or |
||
| 6. | insolvency
of Broker-Dealer. |
| C. | Termination
for any of the reasons set forth in sub-sections B.1. through B.4. will occur immediately
upon Notice to Broker-Dealer. Termination for the reason set forth in sub-section
B.5. and B.6. will occur automatically at the date and hour of the action described
in sub-section B.5. and B.6. |
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| D. | Either party
shall have the right to suspend Broker-Dealer’s right to solicit and sell Contracts
to potential contract owners, by giving the other party thirty (30) days notice
of the suspension. |
||
| E. | Upon termination
of this Agreement, all authorizations, rights and obligations shall cease except
those contained in Sections VI, VIII, IX, X, XI, XIII, XIV, XV and XVI. |
| XIII. | Indemnity | ||||
| A. | Indemnification
by Distributor – The Distributor agrees to indemnify and hold harmless
Broker-Dealer, its directors, trustees, and officers, and each person, if any,
who controls the Broker-Dealer within the meaning of Section 15 of the Securities
Act, (collectively, the “Indemnified Parties” for the purposes of this
Section) against any and all losses, claims, damages, liabilities (including amounts
paid in settlement) or litigation expenses (including legal and other expenses),
to which the Indemnified Parties may become subject as a result of any untrue statement
of any material fact contained in any registration statement, prospectus, or any
other sales or offering materials furnished by the Distributor or approved in writing
by the Distributor relating to the Contracts or related separate account (or any
amendment or supplement to any of the foregoing), or as a result of the omission
to state therein a material fact required to be stated therein or necessary to make
the statements therein not misleading. |
||
| B. | Indemnification
by Company – Company agrees to indemnify and hold harmless Broker-Dealer,
its directors, trustees, and officers, and each person, if any, who controls the
Broker-Dealer within the meaning of Section 15 of the Securities Act, (collectively,
the “Indemnified Parties” for the purposes of this Section) against any
and all losses, claims, damages, liabilities (including amounts paid in settlement)
or litigation expenses (including legal and other expenses), to which the Indemnified
Parties may become subject as a result of any untrue statement of any material fact
contained in any registration statement, prospectus, or any other sales or offering
materials furnished by the Company or approved in writing by the Company relating
to the Policies or related separate account (or any amendment or supplement to any
of the foregoing), or as a result of the omission to state therein a material fact
required to be stated therein or necessary to make the statements therein not misleading. |
||
| C. | Indemnification by the Broker-Dealer – Broker-Dealer shall indemnify, defend and hold harmless
the Company and Distributor and each person who controls or is associated with the
Company or Distributor within the meaning of the federal securities laws and any
director, officer, corporate agent, employee, attorney and any representative thereof,
from and against all losses, expenses, claims, damages and liabilities (including
any costs of investigation and legal expenses and any amounts paid in settlement
of any action, suit or proceeding of any claim asserted) which result from, arise
out of or are based upon: |
| 1. | any breach
by Broker-Dealer, its Registered Representatives, Broker or Affiliates of any provision
or term or condition of this Agreement; |
||
| 2. | any violation
by Broker-Dealer, its Registered Representatives, Brokers or Affiliates of any federal,
state, local or foreign law or regulation; |
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| 3. | any claim
by a Registered Representative or Broker against the Company or Distributor for
Compensation; or |
||
| 4. | bad faith,
negligence, misconduct, willful malfeasance or omissions of the Broker-Dealer, its
Registered Representatives, Brokers or Affiliates in the solicitation of applications
for, or sales of, Contracts or Policies or any other unlawful sales practices or
conduct. |
| D. | If a party
is named in any lawsuit or other proceeding for which such party believes it may
be entitled to indemnification hereunder, such party will: |
| 1. | Promptly notify
the indemnifying party of any such proceeding, investigation, or litigation and
furnish the indemnifying party with a copy of any notices, pleadings and other correspondence; |
||
| 2. | Provide the
indemnifying party reasonable opportunity to consult with the indemnified party
in the development of strategy and the substantive position to be taken, and the
determination of the course of action to be taken; and |
||
| 3. | Consider in
good faith any suggestion made by the indemnifying party and follow the recommendations
of the indemnifying party, including its recommendations as to settlement, compromise
or other agreed upon resolution of the proceeding, provided there is a reasonable
basis for such recommendations and there is no material adverse effect on the indemnified
party. |
| E. | The Indemnifying
Party, upon the request of the indemnified party, shall retain counsel reasonably
satisfactory to the indemnified party to represent the indemnified party and any
others the indemnifying party may designate in such proceeding and shall pay the
fees and disbursements of such counsel related to such proceeding. |
| XIV. | Fidelity Bond | ||||
Broker-Dealer agrees that all directors, officers and employees of Broker-Dealer and all its Registered Representatives and Brokers who are appointed pursuant to this Agreement or who have access to funds of the Company and/or Distributor are and will continue to be covered by a blanket fidelity bond including coverage for larceny, embezzlement or any other defalcation, issued by a reputable bonding company. This bond shall be maintained at Broker-Dealer’s expense. Such bond shall be at least equivalent to the minimal coverage required under FINRA Conduct Rules, endorsed to extend coverage to life insurance and annuity transactions. Broker-Dealer acknowledges that the Company and/or Distributor may require evidence that such coverage is in force and Broker-Dealer shall promptly give Notice to the Company and/or Distributor of any notice of cancellation or change of coverage. Broker-Dealer assigns any proceeds received from the fidelity bond company to the Company and/or Distributor to the extent of the Company’s and/or Distributor’s loss due to activities covered by the bond. If there is any deficiency, Broker-Dealer will promptly pay the Company and/or Distributor that amount on demand, and Broker-Dealer shall indemnify and hold harmless the Company and/or Distributor from any deficiency and from the cost of collection. Additionally, Broker-Dealer and its Affiliates shall maintain other errors and omissions or liability insurance acceptable to Company and/or Distributor.
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| XV. | Privacy | ||||
Each party acknowledges that they may be provided with information or access information about customers of Company or Broker-Dealer (“Customer Information”). Each party agrees to comply with all federal, state, provincial and/or local law or regulation related to privacy. Furthermore, each party represents and warrants that it has implemented and currently maintains an effective information security program to protect the Customer Information, which program includes administrative, technical, and physical safeguards:
| A. | to ensure
the security and confidentiality of Customer Information; |
||
| B. | to protect
against any anticipated threats or hazards to the security or integrity of such
Customer Information; and |
||
| C. | to protect
against unauthorized access to or use of Customer Information which could result
in substantial harm or inconvenience to either party or other affiliates, or to
customers of any of them. |
If Broker-Dealer has a breach of security that requires notice to an individual under applicable state laws, Broker-Dealer will also provide Company with a copy of such notice at the same time it is sent to such individual in accordance with the Notice provision of this Agreement.
| XVI. | Anti-Money Laundering | ||||
| A. | Broker-Dealer,
its Registered Representatives, Brokers and Affiliates agree to comply with applicable
laws, regulations and self-regulatory organization rules and guidance governing
the detection, prevention and reporting of money laundering and terrorist financing
activities, including, but not limited to: (1) provisions of the USA PATRIOT Act
of 2001 and regulations thereunder; (2) provisions of the Bank Secrecy Act and regulations
thereunder; (3) relevant rules and regulations promulgated by the Office of Foreign
Assets Control; (4) relevant rules and guidance of FINRA; and (5) all record keeping,
reporting and auditing requirements of these laws, regulations and rules. Distributor
and Company shall have the right, upon reasonable Notice, to obtain and review documentation
evidencing compliance with the foregoing laws, regulations and rules. Broker- Dealer
agrees to promptly notify Distributor and Company if it becomes aware of any changes
in the representations set forth herein. |
||
| B. | Broker-Dealer
agrees that it has developed and adopted a Customer Identification Program in accordance
with Section 326 of the USA PATRIOT Act and all implementing rules and regulations,
including rules contained in Securities and Exchange Commission Release No. 34-47752.
Such Customer Identification Program must provide reasonable procedures to: (1)
verify the identity of any person seeking to open an account with Broker-Dealer;
(2) maintain records of the information used by Broker-Dealer to verify the person’s identity; and (3) determine whether a customer appears on any list of known
or suspected terrorists or terrorist organizations issued by any Federal governmental
agency. |
||
| C. | Broker-Dealer
agrees to require and ensure that its Registered Representatives, Brokers and Affiliates
have completed anti-money laundering training. |
||
| D. | Broker-Dealer
agrees to provide Distributor with an annual certification declaring (i) that it
has implemented its anti-money laundering program in accordance with Section 352
of the USA PATRIOT Act, (ii) that it or its agent will perform the specified requirements
of Broker-Dealer’s |
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Customer Identification
Program in the manner contemplated by Section 326 of the USA PATRIOT Act and all
implementing rules and regulations, and (iii) its Registered Representatives, Brokers
and Affiliates have completed the foregoing anti-money laundering training. |
|||
| E. | This provision
applies to both Contracts and Policies. |
XVII. General Provisions
| A. | Assignability – This Agreement shall not be assigned by either party without the prior written consent of the other. | ||
| B. | Non-Waiver – Any right(s) not enforced by the Company or Distributor under this Agreement
will not be construed as a waiver of any of the terms and conditions of this Agreement
and the same will remain in full force and effect. A waiver of any provision in
this Agreement will not be deemed to be a waiver of any other provision, whether
or not similar, nor will any waiver of a provision in this Agreement be deemed to
constitute a continuing waiver. |
||
| C. | Severability – Any term or provision of this Agreement which is invalid pursuant to the laws
and regulations of that jurisdiction will, as for that jurisdiction, be ineffective.
Such term or provision will not render the remaining terms and provisions of this
Agreement invalid. In addition, such term or provision will not affect the validity
of any of the terms or provisions of this Agreement in any other jurisdiction. |
||
| D. | Captions – The captions or headings of this Agreement are for convenience and ease of
reference only. They will have no effect on the meaning or interpretation of any
provision of this Agreement. |
||
| E. | Amendment – The Company or Distributor reserves the right to amend this Agreement at any
time. Submission of an application for a Policy or Contract after Notice of such
amendment will constitute agreement of the Broker-Dealer to such amendment. |
||
| F. | Entire
Agreement – This Agreement and its Schedules and Addendums constitute the
entire agreement between the parties and supercedes all prior agreements and understandings,
oral and written. |
| XVIII. | Effective Date | ||||
This Agreement is effective once fully executed by both the Distributor and Broker-Dealer. The Effective Date shall be the date the Distributor executes the Agreement.
| XIX. | Governing Law | ||||
This Agreement shall be governed by and construed in accordance with the laws of the State of New Jersey (without regard to the conflicts of laws provisions) thereof and that in all cases where a party seeks relief in connection with this Agreement in a court of competent jurisdiction, the exclusive forum and venue shall be the state and federal courts having jurisdiction and venue in the State of New Jersey.
| XX. | Notice | ||||
Notice to the Broker-Dealer under this Agreement will be provided by the Company or Distributor and will be deemed given as follows:
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| A. | When posted
to the “Notices & Schedules” page of the Company’s Website; |
||
| B. | When sent
electronically by e-mail to the Broker-Dealer’s most recent e-mail address
on file with the Company or Distributor; or |
||
| C. | When provided
in writing and sent by facsimile, prepaid overnight courier, or first-class mail
to the Broker-Dealer’s most recent address on file with the Company. |
All notices to the Company under this Agreement will be provided in writing by the Broker—Dealer and sent by facsimile, prepaid overnight courier, or first-class mail to:
If to Distributor:
Pruco Securities,
LLC
000 Xxxxxxxxxx Xxxxxx - 00xx xxxxx
Xxxxxx, XX 00000
Attention: Xxxxxx
Xxxxxx
Facsimile: 000-000-0000
(The remainder of this page is left blank intentionally.)
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| If to Company: | ||||
| The Prudential Insurance Company | The Pruco Life Insurance | The Pruco Life Insurance Company of | ||
| of America | Company | New Jersey | ||
| 000 Xxxxxxxxxx Xxxxxx - 18th floor | 000 Xxxxxxxxxx Xxxxxx - 18th floor | 000 Xxxxxxxxxx Xxxxxx - 00xx xxxxx | ||
| Xxxxxx, XX 00000 | Xxxxxx, XX 00000 | Xxxxxx, XX 00000 | ||
| Attention: Xxxxxx Xxxxxx | Attention: Xxxxxx Xxxxxx | Attention: Xxxxxx Xxxxxx | ||
| Facsimile: 000-000-0000 | Facsimile: 000-000-0000 | Facsimile: 000-000-0000 | ||
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed as of the dates set forth below.
| Broker Dealer | |||||
| By:________________________________ | |||||
| <First name> <Last name> | |||||
| Title:_______________________________ | |||||
| Broker-Dealer’s e-mail address: ____________________________________________ | |||||
| PRUCO SECURITIES, LLC | Prudential Insurance Company of America | ||||
| By:________________________ | By:____________________________ | ||||
| Xxxxxx Xxxxxx, Vice President | Xxxxxx Xxxxxx, Vice President | ||||
| Date:______________________ | Date:__________________________ | ||||
| Pruco Life Insurance Company | Pruco Life Insurance Company of New Jersey | ||||
| By:________________________ | By:____________________________ | ||||
| Xxxxxx Xxxxxx, Vice President | Xxxxxx Xxxxxx, Vice President | ||||
| Date:______________________ | Date:__________________________ | ||||
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SCHEDULE A
Each of the undersigned is affiliated with Broker-Dealer and represents that it holds the necessary corporate insurance license to act in connection with the sale of Contracts and Policies, as defined in the Agreement, in those states so identified next to its name. By executing this Schedule A each of the undersigned agrees to be bound by the terms and conditions of the Agreement as if each Affiliate was the Broker-Dealer for purposes of applying the terms and conditions of this Agreement.
| COMPANY | STATE(S) | TIN and Officer’s Signature. |
| «Life_Affiliate__1» | «Life_Affiliate_State__1» | «Life_Affiliate_Tax_ID__1» |
| «Life_Affiliate__2» | «Life_Affiliate_State__2» | «Life_Affiliate_Tax_ID__2» |
| «Life_Affiliate__3» | «Life_Affiliate_State__3» | «Life_Affiliate_Tax_ID__3» |
| «Life_Affiliate__4» | «Life_Affiliate_State__4» | «Life_Affiliate_Tax_ID__4» |
| «Life_Affiliate__5» | «Life_Affiliate_State__5» | «Life_Affiliate_Tax_ID__5» |
| «Life_Affiliate__6» | «Life_Affiliate_State__6» | «Life_Affiliate_Tax_ID__6» |
| «Life_Affiliate__7» | «Life_Affiliate_State__7» | «Life_Affiliate_Tax_ID__7» |
| «Life_Affiliate__8» | «Life_Affiliate_State__8» | «Life_Affiliate_Tax_ID__8» |
| «Life_Affiliate__9» | «Life_Affiliate_State__9» | «Life_Affiliate_Tax_ID__9» |
| «Life_Affiliate__10» | «Life_Affiliate_State__10» | «Life_Affiliate_Tax_ID__10» |
| «Life_Affiliate__11» | «Life_Affiliate_State__11» | «Life_Affiliate_Tax_ID__11» |
| SCHEDULE B | ||
| Contracts and Policies for Pruco Life Insurance Company | ||
| • | PruLife® Custom Premier II* (“VUL” Flexible Premium Variable Universal Life Insurance Contract) | |
| • | PruLife® Universal Plus (“UL”) | |
| • | PruLife® Universal Protector (“UL”) | |
| • | Term EliteSM | |
| • | Term EssentialSM | |
| • | PruLife® Return of Premium Term | |
| • | PruLife® SUL Protector | |
| Contracts and Policies for Pruco Life Insurance Company of New Jersey | ||
| • | PruLife® Custom Premier II* (“VUL” Flexible Premium Variable Universal Life Insurance Contract) | |
| • | PruLife Universal Protector (“UL”) | |
| • | Term EliteSM | |
| • | Term EssentialSM | |
| • | PruLife® Return of Premium Term | |
| • | PruLife® SUL Protector | |
| Contracts and Policies for the Prudential Insurance Company of America | ||
| • | PruLife® Universal Plus (“UL”) | |
| • | PruBenefit Select* (Flexible Premium Variable Universal Life Insurance Contract) | |
| * Securities under the Securities Act of 1933 | ||
Schedule C
List of Policies and
Procedures
| • | Licensing, Appointment and Registration Policy | |
| • | Replacement Policies and Procedures |
