UNDERWRITING AND
SERVICING AGREEMENT
This UNDERWRITING AND SERVICING AGREEMENT is made this day of February,
1996, by and between MML Investors Services, Inc. ("MMLISI") and Massachusetts
Mutual Life Insurance Company ("MassMutual"), on its own behalf and on behalf of
Connecticut Mutual Variable Life Separate Account I (the "Separate Account"), a
separate account of MassMutual, as follows:
WHEREAS, the Separate Account was established on March 3, 1994 pursuant to
authority of the Board of Directors of Connecticut Mutual Life Insurance Company
("CML") in order to set aside and invest assets attributable to certain variable
annuity policies (the "Policies") issued by CML; and
WHEREAS, MassMutual and CML entered into an Agreement and Plan of Merger
(the "Merger Agreement") dated as of September 13, 1995, pursuant to which
MassMutual and CML combined their operations in a statutory merger under
Connecticut and Massachusetts law (the "Merger"); and
WHEREAS, MassMutual will retain its "Massachusetts Mutual Life Insurance
Company" name after the Merger; and
WHEREAS, CML has registered the Separate Account under the Investment
Company Act of 1940, as amended, (the "1940 Act") and has registered the
Policies under the Securities Act of 1933, as amended, (the "1933 Act"); and
WHEREAS, MassMutual will continue the effectiveness of the registrations of
the Separate Account under the 1940 Act and the Policies under the 1933 Act; and
WHEREAS, MassMutual intends for the Policies to be sold by its agents and
brokers who are required to be registered representatives of a broker-dealer
that is registered with the Securities and Exchange Commission (the "SEC") under
the Securities Exchange Act of 1934 ("1934 Act") and a member of the National
Association of Securities Dealers, Inc. (the "NASD"); and
WHEREAS, MassMutual desires to engage MMLISI, a broker-dealer registered
with the SEC under the 1934 Act and a member of the NASD, to act as a
co-underwriter ("Co-underwriter") in connection with the distribution of the
Policies by the full-time career contracted agents of MassMutual ("Agents") and
certain other brokers, and in connection therewith, to provide certain services
and supervision to such Agents and brokers who are also registered
representatives of MMLISI and who sell the Policies, and to otherwise perform
certain duties and functions that are necessary and proper for the distribution
of the Policies as required under applicable federal and state securities laws
and NASD regulations, and MMLISI desires to act as Co-underwriter for the sale
of the Policies and to assume such responsibilities;
NOW, THEREFORE, the parties hereto agree as follows:
1. UNDERWRITER. MassMutual hereby appoints MMLISI as, and MMLISI agrees to
serve as, Co-underwriter of the Policies during the term of this Agreement for
purposes of federal and state securities laws. MassMutual reserves the right,
however, to refuse at any time or times to sell any Policies hereunder for any
reason, and MassMutual maintains ultimate responsibility for the sales of the
Policies.
2. SERVICES. MMLISI agrees, on behalf of MassMutual and in its capacity as
Co-underwriter, to undertake at its own expense except as otherwise provided
herein, to provide certain sales, administrative and supervisory services
relative to the Policies as described below, and otherwise to perform all duties
that are necessary and proper for the distribution of the Policies as required
under applicable federal and state securities laws and NASD regulations.
3. BEST EFFORTS. MMLISI shall use reasonable efforts to sell the Policies
but does not agree hereby to sell any specific number of Policies and shall be
free to act as underwriter of other securities. MMLISI agrees to offer the
Policies for sale in accordance with the prospectus then in effect for the
Policies.
4. COMPLIANCE AND SUPERVISION. All persons who are engaged directly or
indirectly in the operations of MMLISI and MassMutual in connection with the
offer or sale of the Policies shall be
considered a "person associated" with MMLISI as defined in Section 3(a)(18) of
the 1934 Act. MMLISI shall have full responsibility for the securities
activities of each such person as contemplated by Section 15 of the 1934 Act.
MMLISI shall be fully responsible for carrying out all compliance,
supervisory and other obligations hereunder with respect to the activities of
its registered representatives as required by the NASD Rules of Fair Practice
(the "Rules") and applicable federal and state securities laws. Without limiting
the generality of the foregoing, MMLISI agrees that it shall be fully
responsible for:
(a) ensuring that no representative of MMLISI shall offer or sell the
Policies until such person is appropriately licensed, registered, or
otherwise qualified to offer and sell such Policies under the federal
securities laws and any applicable securities laws of each state or other
jurisdiction in which such Policies may be lawfully sold, in which
MassMutual is licensed to sell the Policies, and in which such person shall
offer or sell the Policies; and
(b) training and supervising MassMutual's Agents and brokers who are
also registered representatives of MMLISI for purposes of complying on a
continuous basis with the Rules and with federal and state securities laws
applicable in connection with the offering and sale of the Policies. In this
connection, MMLISI shall:
(i) jointly conduct with MassMutual such training (including the
preparation and utilization of training materials) as in the opinion of
MMLISI and MassMutual is necessary to accomplish the purposes of this
Agreement;
(ii) establish and implement reasonable written procedures for
supervision of sales practices of registered representatives of MMLISI
who sell the Policies;
(iii) provide a sufficient number of registered principals and an
adequately staffed compliance department to carry out the
responsibilities as set forth herein;
(iv) take reasonable steps to ensure that MassMutual Agents and
brokers who are also registered representatives of MMLISI recommend the
purchase of the Policies only upon reasonable grounds to believe that the
purchase of the Policies is suitable for such applicant; and
(v) impose disciplinary measures on agents of MassMutual who are also
registered representatives of MMLISI as required.
The parties hereto recognize that any registered representative of MMLISI
selling the Policies as contemplated by this Agreement shall also be acting as
an insurance agent of MassMutual or as an insurance broker, and that the rights
of MMLISI to supervise such persons shall be limited to the extent specifically
described herein or required under applicable federal or state securities laws
or NASD regulations. Such persons shall not be considered employees of MMLISI
and shall be considered agents of MMLISI only as and to the extent required by
such laws and regulations. Further, it is intended by the parties hereto that
such persons are and shall continue to be considered to have a common law
independent contractor relationship with MassMutual and not to be common law
employees of MassMutual.
5. REGISTRATION AND QUALIFICATION OF POLICIES. MassMutual has prepared or
caused to be prepared a registration statement describing the Policies, together
with exhibits thereto (hereinafter referred to as the "Registration Statement").
The Registration Statement includes a prospectus (the "Prospectus") for the
Policies.
MassMutual agrees to execute such papers and to do such acts and things as
shall from time-to-time be reasonably requested by MMLISI for the purpose of
qualifying and maintaining qualification of the Policies for sale under
applicable state law and for maintaining the registration of the Separate
Account and interests therein under the 1933 Act and the 1940 Act, to the end
that there will be available for sale from time-to-time such amounts of the
Policies as MMLISI may reasonably be
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expected to sell. MassMutual shall advise MMLISI promptly of any action of the
SEC or any authorities of any state or territory, of which it is aware,
affecting registration or qualification of the Separate Account, or rights to
offer the Policies for sale.
If any event shall occur as a result of which it is necessary to amend or
supplement the Registration Statement in order to make the statements therein,
in light of the circumstances under which they were or are made, true, complete
or not misleading, MassMutual will forthwith prepare and furnish to MMLISI,
without charge, amendments or supplements to the Registration Statement
sufficient to make the statements made in the Registration Statement as so
amended or supplemented true, complete and not misleading in light of the
circumstances under which they were made.
6. REPRESENTATIONS OF MASSMUTUAL. MassMutual represents and warrants to
MMLISI as follows:
(a) MassMutual is an insurance company duly organized under the laws of
the Commonwealth of Massachusetts and is in good standing and is authorized
to conduct business under the laws of each state in which the Policies are
sold, that the Separate Account was legally and validly established as a
segregated asset account under the Insurance Code of Connecticut, and that
the Separate Account has been properly serve as a segregated investment
account for the Policies.
(b) All persons that will be engaging in the offer or sale of the
Policies will be registered as a unit investment trust in accordance with
the provisions of the 1940 Act to authorized insurance agents of MassMutual.
(c) The Registration Statement does not and will not contain any
statements of a material fact or omit to state any material fact required to
be stated therein or necessary to make the statements therein, in light of
the circumstances under which they were or are made, not materially
misleading.
(d) MassMutual shall make available to MMLISI copies of all financial
statements that MMLISI reasonably requests for use in connection with the
offer and sale of the Policies.
(e) No federal or state agency or bureau has issued an order preventing
or suspending the offer of the Policies or the use of the Registration
Statement, or of any part thereof, with respect to the sale of the Policies.
(f) The offer and sale of the Policies is not subject to registration
under the Blue Sky laws of the states in which the Policies will be offered
and sold.
(g) The Policies are qualified for offer and sale under the applicable
state insurance laws in those states in which the Policies shall be offered
for sale. In each state where such qualification is effected, MassMutual
shall file and make such statements or reports as are or may be required by
the laws of such state.
(i) This Agreement has been duly authorized, executed and delivered by
MassMutual and constitutes the valid and legally binding obligation of
MassMutual. Neither the execution and delivery of this Agreement by
MassMutual nor the consummation of the transactions contemplated herein will
result in a breach or violation of any provision of the state insurance laws
applicable to MassMutual, any judicial or administrative orders in which it
is named or any material agreement or instrument to which it is a party or
by which it is bound.
7. REPRESENTATIONS OF MMLISI. MMLISI represents and warrants to MassMutual
as follows:
(a) MMLISI is duly registered as a broker-dealer under the 1934 Act and
is a member in good standing of the NASD and, to the extent necessary to
perform the activities contemplated hereunder, is duly registered, or
otherwise qualified, under the applicable securities laws of every state or
other jurisdiction in which the Policies are available for sale.
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(b) This Agreement has been duly authorized, executed and delivered by
MMLISI and constitutes the valid and legally binding obligation of MMLISI.
Neither the execution and delivery of this Agreement by MMLISI nor the
consummation of the transactions contemplated herein will result in a breach
or violation of any provision of the federal or state securities laws or the
Rules, applicable to MMLISI, or any judicial or administrative orders in
which it is named or any material agreement or instrument to which it is a
party or by which it is bound.
(c) MMLISI shall comply with the Rules and the securities laws of any
jurisdiction in which it sells, directly or indirectly, any Policies.
8. EXPENSES. MMLISI shall be responsible for all expenses incurred in
connection with its provision of services and the performance of its obligations
hereunder, except as otherwise provided herein.
MassMutual shall be responsible for: (a) all expenses of printing and
distributing the Prospectuses, and (b) all other expenses of preparing, printing
and distributing all other sales literature or material for use in connection
with offering the Policies for sale.
9. SALES LITERATURE AND ADVERTISING. MMLISI agrees to ensure that its
registered representatives use only the Prospectus, statements of additional
information, or other applicable and authorized sales literature then in effect
in selling the Policies. MMLISI is not authorized to give any information or to
make any representations concerning the Policies other than those contained in
the current Registration Statement filed with the SEC or in such sales
literature as may be authorized by MassMutual.
MMLISI agrees to make timely filings with the SEC, the NASD, and such other
regulatory authorities as may be required of any sales literature or advertising
materials relating to the Policies and intended for distribution to prospective
investors. MassMutual shall review and approve all advertising and sales
literature concerning the Policies utilized by MMLISI. MMLISI also agrees to
furnish to MassMutual copies of all agreements and plans it intends to use in
connection with any sales of the Policies.
10. APPLICATIONS. All applications for Policies shall be made on
application forms supplied by MassMutual, and shall be remitted by MMLISI
promptly, together with such forms and any other required documentation,
directly to MassMutual at the address indicated on such application or to such
other address as MassMutual may, from time to time, designate in writing. All
applications are subject to acceptance or rejection by MassMutual at its sole
discretion.
11. PAYMENTS. All money payable in connection with any of the Policies,
whether as premiums, purchase payments or otherwise, and whether paid by, or on
behalf of any applicant or Policy owner, is the property of MassMutual and shall
be transmitted immediately in accordance with the administrative procedures of
MassMutual without any deduction or offset for any reason, including by example
but not limitation, any deduction or offset for compensation claimed by MMLISI.
Checks or money orders as payment on any Policy shall be drawn to the order of
"Massachusetts Mutual Life Insurance Company." No cash payments shall be
accepted by MMLISI in connection with the Policies. Unless otherwise agreed to
by MassMutual in writing, neither MMLISI nor any of MassMutual's Agents nor any
broker shall have an interest in any surrender charges, deductions or other fees
payable to MassMutual as set forth herein.
12. INSURANCE LICENSES. MassMutual shall apply for and maintain the proper
insurance licenses and appointments for each of the Agents and brokers selling
the Policies in all states or jurisdictions in which the Policies are offered
for sale by such person. MassMutual reserves the right to refuse to appoint any
proposed Agent or broker, and to terminate an Agent or broker once appointed.
MassMutual agrees to be responsible for all licensing or other fees required
under pertinent state insurance laws to properly authorize Agents or brokers for
the sale of the Policies; however, the foregoing shall not limit MassMutual's
right to collect such amount from any person or entity other than MMLISI.
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13. AGENT/BROKER COMPENSATION. Commissions or other fees due all brokers
and Agents in connection with the sale of Policies shall be paid by MassMutual,
on behalf of MMLISI, to the persons entitled thereto in accordance with the
applicable agreement between each such broker or Agent and MassMutual or a
general agent thereof. MMLISI shall assist MassMutual in the payment of such
amounts as MassMutual shall reasonably request, provided that MMLISI shall not
be required to perform any acts that would subject it to registration under the
insurance laws of any state. The responsibility of MMLISI shall include the
performance of all activities by MMLISI necessary in order that the payment of
such amounts fully complies with all applicable federal and state securities
laws. Unless applicable federal or state securities law shall require,
MassMutual retains the ultimate right to determine the commission rate paid to
its Agents.
14. MMLISI COMPENSATION. As payment for its services hereunder, MMLISI
shall receive an annual fee that has the following components: (1) a fixed fee
in the amount of $ per year, and (2) a variable fee in the amount of
basis points per year of new sales of the Policies. Payments shall commence and
be made no later than December 31 of the year in which a Policy is issued. The
variable component of the fee shall be paid to MMLISI's wholly-owned subsidiary,
MML Insurance Agency, Inc. ("MMLIAI"). The fixed component shall be renegotiated
annually commencing in 1997. The last agreed-to amounts for each of these fees
shall remain in effect until the new fees are mutually agreed upon and are set
forth in schedules attached hereto.
15. BOOKS AND RECORDS. MMLISI and MassMutual shall each cause to be
maintained and preserved for the period prescribed such accounts, books, and
other documents as are required of it by the 1934 Act and any other applicable
laws and regulations. In particular, without limiting the foregoing, MMLISI
shall cause all the books and records in connection with the offer and sale of
the Policies by its registered representatives to be maintained and preserved in
conformity with the requirements of Rules 17a-3 and 17a-4 under the 1934 Act, to
the extent that such requirements are applicable to the Policies. The books,
accounts, and records of MMLISI and MassMutual as to all transactions hereunder
shall be maintained so as to disclose clearly and accurately the nature and
details of the transactions. The payment of premiums, purchase payments,
commissions and other fees and payments in connection with the Policies by its
registered representatives shall be reflected on the books and records of MMLISI
as required under applicable NASD regulations and federal and state securities
laws requirements.
MMLISI and MassMutual, from time to time during the term of this Agreement,
shall divide the administrative responsibility for maintaining and preserving
the books, records and accounts kept in connection with the Policies; provided,
however, in the case of books, records and accounts kept pursuant to a
requirement of applicable law or regulation, the ultimate and legal
responsibility for maintaining and preserving such books, records and accounts
shall be that of the party which is required to maintain or preserve such books,
records and accounts under the applicable law or regulation, and such books,
records and accounts shall be maintained and preserved under the supervision of
that party. MMLISI and MassMutual shall each cause the other to be furnished
with such reports as it may reasonably request for the purpose of meeting its
reporting and recordkeeping requirements under such regulations and laws, and
under the insurance laws of the Commonwealth of Massachusetts and any other
applicable states or jurisdictions.
MMLISI and MassMutual each agree and understand that all documents, reports,
records, books, files and other materials required under applicable Rules and
federal and state securities laws shall be the property of MMLISI, unless such
documents, reports, records, books, files and other materials are required by
applicable regulation or law to be also maintained by MassMutual, in which case
such material shall be the joint property of MMLISI and MassMutual. All other
documents, reports, records, books, files and other materials maintained
relative to this Agreement shall be the property of MassMutual. Upon termination
of this Agreement, all said material shall be returned to the applicable party.
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MMLISI and MassMutual shall establish and maintain facilities and procedures
for the safekeeping of all books, accounts, records, files, and other materials
related to this Agreement. Such books, accounts, records, files, and other
materials shall remain confidential and shall not be voluntarily disclosed to
any other person or entity.
16. AVAILABILITY OF RECORDS. MMLISI and MassMutual shall each submit to
all regulatory and administrative bodies having jurisdiction over the sales of
the Policies, present or future, any information, reports, or other material
that any such body by reason of this Agreement may request or require pursuant
to applicable laws or regulations. In particular, without limiting the
foregoing, MassMutual agrees that any books and records it maintains pursuant to
paragraph 15 of this Agreement which are required to be maintained under Rule
17a-3 or 17a-4 of the 1934 Act shall be subject to inspection by the SEC in
accordance with Section 17(a) of the 1934 Act and Sections 30 and 31 of the 1940
Act.
17. CONFIRMATIONS. MassMutual agrees to prepare and mail a confirmation
for each transaction in connection with the Policies at or before the completion
thereof as required by the 1934 Act and applicable interpretations thereof,
including Rule 10b-10 thereunder. Each such confirmation shall reflect the facts
of the transaction, and the form thereof will show that it is being sent on
behalf of MMLISI acting in the capacity of agent for MassMutual.
18. INDEMNIFICATION. MassMutual shall indemnify MMLISI, its registered
representatives, officers, directors, employees, agents and controlling persons
and hold such persons harmless, from and against any and all losses, damages,
liabilities, claims, demands, judgments, settlements, costs and expenses of any
nature whatsoever (including reasonable attorneys' fees and disbursements)
resulting or arising out of or based upon an allegation or finding that: (i) the
Registration Statement or any application or other document or written
information provided by or on behalf of MassMutual includes any untrue statement
of a material fact or omits to state a material fact necessary to make the
statements therein, in light of the circumstances under which they are made, not
misleading, unless such statement or omission was made in reliance upon, and in
conformity with, written information furnished to MassMutual by MMLISI or its
registered representatives specifically for use in the preparation thereof, or
(ii) there is a misrepresentation, breach of warranty or failure to fulfill any
covenant or warranty made or undertaken by MassMutual hereunder.
MMLISI will indemnify MassMutual, its officers, directors, employees, agents
and controlling persons and hold such persons harmless, from and against any and
all losses, damages, liabilities, claims, demands, judgments, settlements, costs
and expenses of any nature whatsoever (including reasonable attorneys' fees and
disbursements) resulting or arising out of or based upon an allegation or
finding that: (i) MMLISI or its registered representatives offered or sold or
engaged in any activity relating to the offer and sale of the Policies which was
in violation of any provision of the federal securities laws or, (ii) there is a
material misrepresentation, material breach of warranty or material failure to
fulfill any covenant or warranty made or undertaken by MMLISI hereunder.
Promptly after receipt by an indemnified party under this paragraph 18 of
notice of the commencement of any action by a third party, such indemnified
party will, if a claim in respect thereof is to be made against the indemnifying
party under this paragraph 18, notify the indemnifying party of the commencement
thereof; but the omission to notify the indemnifying party will not relieve the
indemnifying party from liability which the indemnifying party may have to any
indemnified party otherwise than under this paragraph. In case any such action
is brought against any indemnified party, and it notifies the indemnifying party
of the commencement thereof, the indemnifying party will be entitled to
participate therein and, to the extent that it may wish, to assume the defense
thereof, with counsel satisfactory to such indemnified party, and after notice
from the indemnifying party to such indemnified party of its election to assume
the defense thereof, the indemnifying party will not be liable to such
indemnified party under this paragraph for any legal or other expenses
subsequently incurred by such indemnified party in connection with the defense
thereof other than reasonable costs of investigation.
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19. INDEPENDENT CONTRACTOR. MMLISI shall be an independent contractor.
MMLISI is responsible for its own conduct and the employment, control and
conduct of its agents and employees and for injury to such agents or employees
or to others through its agents or employees. MMLISI assumes full responsibility
for its agents and employees under applicable statutes and agrees to pay all
employer taxes thereunder.
20. TERMINATION. Subject to termination as hereinafter provided, this
Agreement shall remain in full force and effect for the initial term of the
Agreement, which shall be for a two year period commencing on the date first
above written, and this Agreement shall continue in full force and effect from
year to year thereafter, until terminated as herein provided.
This Agreement may be terminated by either party hereto upon 30 days written
notice to the other party, or at any time upon the mutual written consent of the
parties hereto. This Agreement shall automatically be terminated in the event of
its assignment. Subject to MassMutual's approval, however, MMLISI may delegate
any duty or function assigned to it in this agreement provided that such
delegation is permissible under applicable law. Upon termination of this
Agreement, all authorizations, rights and obligations shall cease except the the
obligations to settle accounts hereunder, including the settlement of monies due
in connection with the Policies in effect at the time of termination or issuesd
pursuant to applications received by MassMutual prior to termination.
21. INTERPRETATION. This Agreement shall be subject to the provisions of
the 1934 Act and the rules, regulations, and rulings thereunder and of the NASD,
from time to time in effect, and the terms hereof shall be interpreted and
construed in accordance therewith. If any provision of this Agreement shall be
held or made invalid by a court decision, statute, rule, or otherwise, the
remainder of this Agreement shall not be affected thereby. This Agreement shall
be interpreted in accordance with the laws of the Commonwealth of Massachusetts.
22. NON-EXCLUSIVITY. The services of MMLISI and MassMutual to the Separate
Account hereunder are not to be deemed exclusive and MMLISI and MassMutual shall
be free to render similar services to others so long as their services hereunder
are not impaired or interfered with hereby.
23. AMENDMENT. This Agreement constitutes the entire Agreement between the
parties hereto and may not be modified except in a written instrument executed
by all parties hereto.
24. INTERESTS IN AND OF MMLISI. It is understood that any of the
policyholders, directors, officers, employees and agents of MassMutual may be a
shareholder, director, officer, employee, or agent of, or be otherwise
interested in, MMLISI, any affiliated person of MMLISI, any organization in
which MMLISI may have an interest, or any organization which may have an
interest in MMLISI; that MMLISI, any such affiliated person or any such
organization may have an interest in MassMutual; and that the existence of any
such dual interest shall not affect the validity hereof or of any transaction
hereunder except as otherwise provided in the Charter, Articles of
Incorporation, or By-Laws of MassMutual and MMLISI, respectively, or by specific
provision of applicable law.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
signed by their respective officials thereunto duly authorized and seals to be
affixed, as of the day and year first above written.
ATTEST: MASSACHUSETTS MUTUAL LIFE INSURANCE COMPANY,
on its behalf and on behalf of CONNECTICUT
MUTUAL VARIABLE LIFE SEPARATE ACCOUNT I
By:
ATTEST: MML INVESTORS SERVICES, INC.
Second Vice President
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