The Penn Insurance and Annuity Company
Independence Square, Philadelphia, PA 19172
National Accounts - Broker-Dealers Licensed
to Sell Variable Annuities and/or Variable
Life Insurance under Federal Securities Laws
(Companion Agreement - Form A-2)
BROKER-DEALER SELLING AGREEMENT
THE PENN INSURANCE AND ANNUITY COMPANY (hereinafter called "PIA") and
Xxxxxx, Xxxxxxxx & Xxxx, Inc. (hereinafter called "Distributor") enter into this
Agreement with________________________________________(hereinafter called
"Broker-Dealer") on this date _________________________, 19 agree as follows:
W I T N E S S E T H:
WHEREAS, PIA is in the business of issuing annuity and life insurance
contracts to the public;
WHEREAS, Distributor is an affiliate of PIA, is registered as a
broker-dealer under the Securities Exchange Act of 1934, is a member of the
National Association of Securities Dealers, Inc., and is assisting PIA in the
distribution of such contracts;
WHEREAS, Broker-Dealer is registered as a Broker-Dealer under the
Securities Exchange Act of 1934 and is a member of the National Association of
Securities Dealer, Inc.;
WHEREAS, Broker-Dealer is affiliated with , (hereinafter referred to as
"Corporate Insurance Agent") a corporation which is properly licensed under the
insurance laws of the state(s) in which Broker-Dealer will act under this
agreement;
WHEREAS, the parties desire to enter into an arrangement under which
Broker-Dealer and Corporate Insurance Agent agree to sell certain variable
annuity and variable life insurance contracts issued by PIA;
NOW THEREFORE, in consideration of these premises and mutual covenants
herein contained, the parties agree as follows:
1. APPOINTMENT OF BROKER-DEALER
1.1 Subject to the terms and conditions of this agreement, PIA and
Distributor authorizes as a Broker-Dealer non-exclusive agent for the
solicitation of applications for, and the servicing of, variable
annuity and/or variable life insurance contracts identified in the
schedule(s) attached hereto, and Broker-Dealer accepts such
authorization. The variable annuity and/or variable life insurance
contracts identified in the schedules(s) are referred to herein as
"Contracts".
1.2 Broker-Dealer and its representatives shall be independent contractors
as to PIA and Distributor and, subject to the terms and conditions of
this agreement, free to exercise their own judgment as to the time,
place and means of performing all acts hereunder. Nothing in this
agreement is intended to create a relationship of employer and employee
as between PIA or Distributor, on the one hand, and representatives of
Broker-Dealer on the other.
2. SECURITY REGULATIONS AND INSURANCE COORDINATION OF AGREEMENTS.
2.1 The sale of variable annuity and variable life insurance contracts
identified in the schedule(s) attached and Insurance hereto is subject
to and regulated under federal securities laws (and may also be subject
to and regulated under certain state securities laws), in addition to
state insurance laws. It is understood and agreed that registered
representatives of Broker-Dealer shall also be representative of
Corporate Insurance Agent and that Corporate Insurance Agent shall
contemporaneously enter into a Corporate Insurance Agent Selling
Agreement with PIA and Distributor covering the sale of such contracts.
This agreement and the Corporate Insurance Agent Selling Agreement
shall govern the sales of such contracts.
3. SALE OF CONTRACTS.
3.1 Broker-Dealer shall use its best efforts to solicit applications for
Contracts from persons for whom the Contracts are suitable, in
accordance with the terms and conditions of this agreement.
3.2 All applications for Contracts shall be made on applications forms
authorized by PIA. Broker-Dealer shall diligently review all such
applications for accuracy and completeness and shall take all
reasonable and appropriate measures to assure that applications
submitted to PIA are accurate and complete.
3.3 All purchase payments collected by Broker-Dealer for PIA shall be
received in trust and shall be remitted immediately, together with the
application and any other required documentation, to PIA at the address
indicated on the application or to such other address as PIA may
specify in writing. All checks or money orders for payments under
Contracts shall be drawn to the order of PIA, except as may be provided
in the Corporate Insurance Agent Selling Agreement (referred to in
section 21. of this Agreement).
3.4 All applications are subject to acceptance or rejection by PIA in its
sole discretion. PIA may at any time in its sole discretion discontinue
issuing the Contracts or change the form and content of new Contracts
to be issued.
3.5 In soliciting applications for Contracts, Broker-Dealer may not accept
risk of any kind for or on behalf of PIA and may not bind PIA by
promise or agreement or alter any Contract in any way.
4. COMPLIANCE
4.1 In consideration of and as full compensation for the services performed
in accordance with this agreement, Corporate Insurance Agent will
receive compensation from PIA as set forth in the schedule(s) attached
to the Corporate Insurance Agent Selling Agreement referred to in
Section 2.1 of this agreement.
4.2 Should PIA for any reason return to the payor any payment made under a
Contract Broker-Dealer shall cause Corporate Insurance Agent to repay
PIA the total amount of any compensation which PIA may have paid
Corporate Insurance Agent with respect to such payment.
4.3 PIA may, in its sole discretion, change the amount, terms and
conditions of compensation with respect to payments received by PIA
under Contracts.
4.4 PIA shall not be obligated to pay any compensation which would be in
violation of applicable laws of any jurisdiction, anything in this
agreement to the contrary notwithstanding.
4.5 With respect to compensation paid to Corporate Insurance Agent in
connection with the sale of variable annuity and/or variable life
insurance contracts, Broker-Dealer shall cause Corporate Insurance
Agent to maintain, on behalf of Broker-Dealer, such books and records
as are necessary for Broker-Dealer to comply with applicable
recordkeeping requirements under federal and state securities law and
under the rules of the National Association of Securities Dealers, Inc.
5. COMPLIANCE WITH SECURITIES LAWS.
5.1 Broker-Dealer shall not solicit applications for Contracts unless PIA
or Distributor has notified Broker-Dealer that a registration statement
required under the Securities Act of 1933 is effective as to such
contracts and unless Broker-Dealer is duly registered as a
broker-dealer under the Securities Exchange Act of 1934, is a member in
good standing of the National Association of Securities Dealers, Inc.,
and is duly licensed under any applicable securities laws of the state
or jurisdiction in which Broker-Dealer engages in such activity.
5.2 PIA or Distributor shall furnish Broker-Dealer with copies of the
current prospectuses (and current supplements thereto) required to be
used in soliciting applications for variable annuity and/or variable
life insurance contracts.
5.3 Broker-Dealer and its representatives shall comply with all applicable
securities laws and regulations and with the rules of the National
Association of Securities Dealers, Inc. in soliciting applications for
and servicing Contracts. Broker-Dealer shall be fully responsible for
all acts of its representatives in soliciting applications for and
servicing Contracts.
6. ADVERTISEMENTS, SALES LITERATURE AND OTHER COMMUNICATIONS.
6.1 Broker-Dealer shall not print, publish, distribute or use any
advertisements, sales literature or other writing relating to the
Contracts unless such advertisements, sales literature or other writing
shall have first been approved in writing by PIA and Distributor.
6.2 Broker-Dealer shall exercise care not to misrepresent the Contracts or
PIA and shall make no oral or written representation which is
inconsistent with the terms of the Contracts or with the information in
any prospectus or sales literature furnished by PIA or it misleading in
any way.
7. INDEMNIFICATION.
7.1 Broker-Dealer shall indemnify or hold harmless PIA and Distributor and
each director and officer of PIA and Distributor against any losses,
claims, damages or liabilities, including but not limited to reasonable
attorneys' fees and court cost to which PIA or Distributor and any such
director or officer may become subject, under the Securities Act of
1933 or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based
upon any unauthorized use of sales materials or any verbal or written
misrepresentations or any unlawful sales practices, or the failure of
Broker-Dealer, its officers, employees or representative to comply with
the provisions of this agreement or the willful misfeasance, bad faith,
negligence or misconduct of Broker-Dealer, its officers, employees, or
representatives in the solicitation of applications for and the
servicing of Contracts.
7.2 PIA and Distributor shall indemnify and hold harmless Broker-Dealer and
each officer or director of Broker-Dealer against any losses, claims,
damages or liabilities, joint or several, including but not limited to
reasonable attorneys, fees and court cost to which Broker-Dealer or
such officer or director becomes subject, under the Securities Act of
1933 or otherwise, insofar as such losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based
upon any untrue statement or alleged untrue statement of a material
fact required to be stated therein or necessary to make the statements
therein not misleading, contained in any registration statement or any
post-effective amendment or supplement to the prospectus, or in any
sales material written by PIA or Distributor.
7.3 In the event PIA suffers a loss resulting from Broker-Dealer
activities, Broker-Dealer hereby assigns any proceeds received under
its fidelity bond to PIA to the extent of such losses. If there is any
deficiency amount, whether due to a deductible or otherwise,
Broker-Dealer shall promptly pay PIA such amount on demand and
Broker-Dealer shall indemnify and hold harmless PIA from any such
deficiency and from the costs of collection thereof (including
reasonable attorneys' fees).
8. COMPLAINTS, INVESTIGATIONS & PROCEEDINGS.
8.1 Broker-Dealer shall promptly notify PIA and Distributor of any
allegation that Broker-Dealer or any of its representatives violated
any law, regulation or rule in soliciting applications for or servicing
Contracts, and shall provide PIA with full details, including copies of
all legal documents pertaining thereto.
8.2 Broker-Dealer shall cooperate fully with PIA and Distributor in any
regulatory investigation or proceeding or judicial proceeding involving
the solicitation of application for and servicing Contracts by
Broker-Dealer or any of its representatives.
9. NONWAIVER.
9.1 Forbearance by PIA or Distributor to enforce any rights under this
agreement shall not be construed as a waiver of any of the terms and
conditions of this agreement and the same shall remain in full force
and effect. No waiver of any provision of this agreement shall be
deemed to be a waiver of any other provision, whether or not similar,
nor shall any waiver of a provision of this agreement be deemed to
constitute a continuing waiver.
10. AMENDMENT
10.1 PIA reserves the right to amend this Agreement at any time.
Broker-Dealer's submission of an application for a Contract after
notice of any such amendment shall constitute agreement of
Broker-Dealer to such amendment.
11. TERMINATION AND ASSIGNMENT
11.1 This agreement may be terminated by any party, with or without cause,
upon giving written notices to the other parties. This agreement shall
automatically terminate if Broker-Dealer is adjudicated as bankrupt or
avails itself of any insolvency act or if a permanent receiver or
trustee in bankruptcy is appointed for the property of Broker-Dealer.
Upon termination of this agreement with or without cause, all
authorizations, rights and obligations shall cease, except the rights
and obligations set forth in sections 7 and 8 of this agreement and the
obligations to settle account hereunder, including the immediate
forwarding of all payments received by Broker-Dealer under Contract to
PIA, and except as may be expressly stated otherwise in this agreement.
11.2 This agreement may not be assigned without the written consent of all
parties.
12. GOVERNING LAW.
12.1 This agreement shall be construed in accordance with and governed by
the laws of the Commonwealth of Pennsylvania.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by their officers designated below on the day and year
first written.
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Name of Broker-Dealer
By:
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Signature
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Name
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Title
THE PENN INSURANCE AND ANNUITY COMPANY
By:
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Signature
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Name
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Title
XXXXXX, XXXXXXXX & XXXX, INC.
By:
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Signature
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Name
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Title
