UNDERWRITING AND
ADMINISTRATIVE SERVICES AGREEMENT
This AGREEMENT made this 22nd day of January, 2008 between and among
Commonwealth Annuity and Life Insurance Commonwealth Annuity, a Massachusetts
corporation ("Commonwealth Annuity"), on its own behalf and on behalf of each of
its separate investment accounts (collectively, the "Accounts") as set forth in
Appendix A hereto, and Epoch Securities, Inc., a Massachusetts corporation
("Epoch").
WHEREAS, Commonwealth Annuity and the Accounts issue certain variable annuity
contracts or variable insurance policies (the "Contracts") which may be deemed
to be securities under the Securities Act of 1933 (the "1933 Act"), and the laws
of some states;
WHEREAS, Epoch, an affiliate of Commonwealth Annuity, is registered as a
broker-dealer with the Securities and Exchange Commission ("SEC") under the
Securities Exchange Act of 1934 (the "1934 Act") and is a member of the
Financial Industry Regulatory Authority ("FINRA," formerly known as the National
Association of Securities Dealers, Inc.).
WHEREAS, the parties desire Epoch to act as principal underwriter for the
Accounts set forth in Exhibit A, as may be amended from time-to-time by mutual
consent of the parties, to enter into selling agreements with independent
broker-dealers in connection with the sale of the contract, and to assume full
responsibility for the securities activities of all "persons associated" (as
that term is defined in Section 3(a)(18) of the 0000 Xxx) with Epoch and engaged
directly or indirectly in the variable contract operations (the "associated
persons");
WHEREAS, the parties desire to have Commonwealth Annuity perform certain
administrative services on behalf of Epoch in connection with the sale and
servicing of the contracts;
NOW, THEREFORE, in consideration of the covenants and mutual promises of the
parties made to each other, it is hereby covenanted and agreed as follows:
1. Commonwealth Annuity hereby appoints Epoch as the principal underwriter of
the Contracts. Epoch will promote such Variable Contracts in those states in
which Commonwealth Annuity has variable contract authority and in which the
Contracts are qualified for sale under applicable state law, as Commonwealth
Annuity shall so notify Epoch from time to time. Epoch shall suspend its efforts
to effectuate sales of the Contracts in such jurisdictions as Commonwealth
Annuity may request at any time.
2. Epoch shall assume responsibility for the activities of all persons engaged
directly or indirectly in the promotion of the solicitation of the Contracts,
including but not limited to the continued compliance by itself and its
associated persons with the FINRA Rules of Practice and Federal and state
securities laws, to the extent applicable in connection with the sale of the
contracts.
3. Epoch may enter into sales agreements and/or services agreements with
independent broker-dealers for the sale and/or servicing of the Contracts
through their registered
representatives; provided, however, that no such registered representative shall
be allowed to participate in the solicitation of the Contracts unless such
person has been appointed to solicit variable contracts by Commonwealth Annuity
in any state in which such solicitations may occur. All such agreements shall
provide that each independent broker-dealer will assume full responsibility for
continued compliance by itself and its associated persons with applicable laws
and regulations, including but not limited to the FINRA Rules of Fair Practice
and Federal and state securities laws.
4. Epoch agrees that it will not use any sales literature, as defined under the
rules of the FINRA or by the statutes or regulations of any state in which the
Contracts may be solicited, unless such material has received prior written
approval by Commonwealth Annuity. Epoch, directly or through Commonwealth
Annuity as its agent, will make timely filings with the SEC, FINRA, and any
other securities regulatory authorities of all reports and any sales literature
relating to the Accounts, as may be required by statutes or regulations to be
filed by the principal underwriter.
5. On behalf of the Accounts, Commonwealth Annuity will prepare and submit (a)
all registration statements and prospectuses (including amendments) and all
reports required by law to be filed by the Accounts with Federal and state
securities regulatory authorities, and (b) all notices, proxies, proxy
statements, and periodic reports that are to be transmitted to persons having
voting rights with respect to the Accounts.
6. Commonwealth Annuity will, except as otherwise provided in this Agreement,
bear the cost of all services and expenses, including legal services and
expenses, filing fees, and other fees incurred in connection with (a)
registering the Accounts and contracts and qualifying the contracts for sale in
the various states, (b) preparing, printing, and distributing all registration
statements and prospectuses (including amendments), contracts, notices, periodic
reports, and proxy solicitation material and (c) preparing, printing and
distributing advertising and sales literature used by Epoch or furnished by
Epoch to broker-dealers in connection with offering the contracts.
7. All costs associated with the variable contract compliance function
including, but not limited to, fees and expenses associated with qualifying and
licensing associated persons with Federal and state regulatory authorities and
the FINRA and with performing compliance-related administrative services, shall
be allocated to Commonwealth Annuity. To the extent that Epoch incurs
out-of-pocket expenses in connection with the variable contracts compliance
function, Commonwealth Annuity shall reimburse Epoch for such expenses.
8. Sales commissions and other compensation, if any, due to broker-dealers for
the sale of Contracts shall be paid by Commonwealth Annuity through Epoch. Epoch
will reflect such commissions and other compensation on its books and records,
or as otherwise required or permitted by applicable statutes or regulations.
Commonwealth Annuity, as agent for Epoch, agrees to transmit all sales
commissions and other compensation to broker-dealers having a sales agreement
with Epoch. Epoch or Commonwealth Annuity, as agent for Epoch, shall pay all
other remuneration due any other persons for other activities relating to the
sale of the Contracts.
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Commonwealth Annuity shall reimburse Epoch fully and completely for all amounts,
if any, paid by Epoch to any person pursuant to this Section.
9. Commonwealth Annuity shall, as agent for Epoch, (a) maintain and preserve in
accordance with Rules 17a-3 and 17a-4 under the 1934 Act all books and records
required to be maintained by Epoch in connection with the offer and sale of the
Contracts, which books and records shall remain the property of Epoch, and shall
at all times be subject to inspection by the SEC in accordance with Section
17(a) of the 1934 Act and by all other regulatory bodies having jurisdiction
over the Contracts, and (b) send a written confirmation for each contract
transaction reflecting the facts of the transaction and showing that it is being
sent by the Company on behalf of Epoch (acting in the capacity of principal
underwriter for the Accounts), in conformance with the requirements of Rule
10b-10 of the 1934 Act.
10. Each party hereto shall advise the others promptly (a) of any action of the
SEC or any state or federal authorities which affects the registration or
qualification of the Accounts or the contracts, or the right to offer the
contracts for sale, and (b) of any fact or event which makes untrue any
statement in the registration statement or prospectus, or which requires the
making of any change in the registration statement or prospectus, in order to
make the statements therein not misleading.
11. Commonwealth Annuity agrees to be responsible to the Accounts for all sales
and administrative expenses incurred in connection with the administration of
the Contracts and the Accounts other than applicable taxes arising from income
and capital gains of the Accounts and any other taxes arising from the existence
and operation of the Accounts.
12. As compensation for services performed and expenses incurred under this
Agreement, Commonwealth Annuity will receive the charges and deductions as
provided in each outstanding series of Commonwealth Annuity's Contracts. Epoch
will be reimbursed by Commonwealth Annuity for the costs and expenses it incurs,
as set forth in Section 7 above, and may receive additional compensation, if
any, as may be agreed upon by the parties from time-to-time. If Epoch receives
compensation from any third party in connection with services related to the
Contracts, and such services have been or will be directly or indirectly
provided by Commonwealth Annuity, Epoch shall pay such compensation to
Commonwealth Annuity.
13. Each party hereto shall each comply with all applicable provisions of the
Investment Company Act of 1940, Securities Act of 1933 and of all Federal and
state securities and insurance laws, rules and regulations governing the
issuance and sale of the Contracts. Each party hereto agrees to furnish any
other state insurance commissioner or regulatory authority with jurisdiction
over the contracts with any information or reports in connection with services
provided under this Agreement which may be requested in order to ascertain
whether the variable insurance product operations of Commonwealth Annuity are
being conducted in a manner consistent with applicable statutes, rules and
regulations.
14. Commonwealth Annuity agrees to indemnify Epoch against any and all claims,
liabilities and expenses including but not limited to reasonable attorneys fees
which Epoch may incur under the Investment Company Act of 1940, Securities Act
of 1933 and all Federal and
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state securities and insurance laws, rules and regulations governing the
issuance and sale of the Contracts, common law or otherwise, arising out of or
based upon any alleged untrue statements of material fact contained in any
registration statement or prospectus of the Account, or any alleged omission to
state a material fact therein, the omission of which makes any statement
contained therein misleading or of any alleged act or omission in connection
with the offering, sale or distribution of the Contracts by any registered
representatives or associated persons of a FINRA member broker-dealer which has
an agreement with Epoch.
Epoch agrees to indemnify Commonwealth Annuity and the Accounts against any and
all claims, demands, liabilities and expenses, including but not limited to
reasonable attorneys fees, which Commonwealth Annuity or the Accounts may incur,
arising out of or based upon any act of Epoch or of any registered
representative of a FINRA member investment dealer which has an agreement with
Epoch and is acting in accordance with Commonwealth Annuity's instructions.
Commonwealth Annuity acknowledges that Epoch may similarly attempt to hold such
FINRA member broker-dealer responsible for the acts of registered
representatives and associated persons; and to the extent Commonwealth Annuity
is obligated to indemnify Epoch under this Agreement, Epoch agrees to assign its
rights against such broker-dealers to Commonwealth Annuity.
15. This Agreement shall upon execution become effective as of the date first
above written, and
(a) unless otherwise terminated, this Agreement shall continue in effect from
year-to-year;
(b) this Agreement may be terminated by any party at any time upon giving 60
days' written notice to the other parties hereto; and
(c) this Agreement shall automatically terminate in the event of its
assignment.
16. The initial Accounts and Contracts covered by this Agreement are set forth
in Appendix A. This Agreement, including Appendix A, may be amended at any time
by mutual consent of the parties.
17. This Agreement shall be governed by and construed in accordance with the
laws of Massachusetts.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the day
and year first written above.
COMMONWEALTH ANNUITY
AND LIFE INSURANCE COMPANY EPOCH SECURITIES, INC.
By: /s/ Xxxxxxx Xxxxxxx By: /s/ Xxxxxx Xxxxxx
--------------------------------- ------------------------------------
Name: Xxxxxxx Xxxxxxx Name: Xxxxxx Xxxxxx
Title: President and CEO Title: Chief Compliance Officer
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APPENDIX A
A. SEPARATE ACCOUNTS (ESTABLISHED AFTER 12/31/05) AND CONTRACTS
SEPARATE ACCOUNTS
Commonwealth Annuity Separate Account A
VARIABLE ANNUITY CONTRACTS
POLICY FORM MARKETING OR PRODUCT NAME
----------- --------------------------------
3038-07 Advantage IV Variable Annuity
3039-07 Preferred Plus Variable Annuity
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B. SEPARATE ACCOUNTS (ESTABLISHED PRIOR TO 12/31/05) AND CONTRACTS
Separate Account VA-K
Separate Accounts VA-A, VA-B, VA-C, VA-G, VA-H
Separate Accounts D, E, and F
VEL Separate Account
VEL II Account
VEL III Account
Inheiritage Account
Separate Account IMO
Group VEL Account
AGENCY VARIABLE ANNUITY CONTRACTS*
POLICY FORM MARKETING OR PRODUCT NAME
----------- -------------------------------------------------------
AVA-FP-67 67 series elective pay
AVA-FP-69 69 series elective pay
AVA-SP-67 67 series single pay
AVA-SP-69 69 series single pay
AVA-ST-67 67 series stipulated pay
VFR - 68 67 series group elective (GA)
VFS - 68 67 series group elective (GB), Flexible Fixed(84-92)
A3001-75 75 series elective pay
A3002-75 75 series elective pay
A3003-75 75 series single pay
A3004-75 75 series single pay
X0000-00 Xxxxxxxx XXX (single pay)
A3012-79 78/79 series elective pay
A3013-79 78/79 series elective pay
A3014-79 78/79 series single pay
A3015-79 78/79 series single pay
A3018-91 Exec Annuity Plus 91 (3)
A3021-93 Exec Annuity Plus 93
A3025-96 Allmerica Advantage
A3029-99 Allmerica Immediate Advantage
A3030-99 Allmerica Value Generation, Directed Advisory Solutions
A3036-01 Allmerica Premier Choice
* This list shall be deemed to include riders, endorsements, applications,
specification pages, state variations, certificates, binders and
administrative forms (and all state variations thereof) that are issued
with or used with the Contracts. This list includes those Contracts for
which Epoch has served as commission paying agent on behalf of Commonwealth
Annuity.
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AGENCY VARIABLE LIFE POLICIES*
POLICY FORM MARKETING OR PRODUCT NAME
----------- --------------------------------------------------
1018-87 VEL 87
1018-91 XXX 00
0000-00 XXX 00
0000-00 XXX PG/VEL Plus
1026-94 Variable Inheiritage
1029P-94 Group VEL
1029C-94 Group VEL
1030-96 Agency SPVUL 2nd-to-die, Agency SPVUL Single Life,
Agency SPL II
1033-99 IMO, VEL 2001 (Agency)
1034-99 Survivorship VUL (Agency)
* This list shall be deemed to include riders, endorsements, applications,
specification pages, state variations, certificates, binders and
administrative forms (and all state variations thereof) that are issued
with or used with the Policies. This list includes those Policies for which
Epoch has served as commission paying agent on behalf of Commonwealth
Annuity.
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