SALES AGREEMENT
1.0 APPOINTMENT
1.1 The Hartford Insurance Company(ies) named in the Sales Agreement
Specifications Page and, with respect to SEC Registered contracts, if
applicable, Hartford Equity Sales Company, Inc., as Principal
Underwriter, (hereinafter collectively referred to as "Company") hereby
appoint the named individual(s) or organization(s) as "Agent" of
Company for the solicitation and procurement of applications for
insurance contracts (hereinafter referred to as "Contracts") in the
line(s) of business set forth in the Sales Agreement Specifications
Page, in all states in which Company is authorized to do business and
in which Agent is properly licensed and appointed, without exclusive
representation.
2.0 AUTHORITY
2.1 Agent has the power or authority to represent Company only to the
extent expressly granted in this Agreement and no further power or
authority is implied.
2.2 Nothing contained herein is intended to create a relationship of
employer and employee between Company and Agent. Agent and, if
applicable, any sub-agents appointed by Agent, shall be independent
contractors as to Company and free to exercise their own judgment as to
the time, place and means of performing all acts hereunder, but they
shall conform to all regulations of Company not unreasonably
interfering with freedom of action or judgment.
2.3 This Agreement terminates all previous Agency agreements, if any,
between Company and Agent. However, the execution of this Agreement
shall not affect any obligations which have already accrued under any
prior agreement.
2.4 Agent does not have the authority to collect premiums for each line of
business, other than initial premiums, unless specifically set forth in
the applicable commission schedule.
2.5 If Agent is listed on the Specification Page as a Broker or General
Agent, Agent is authorized to procure and solicit applications for
Contracts through sub-agents which Agent may appoint with the approval
of Company. No agreement between Agent and any sub-agent shall impose
any liability or obligation upon Company unless Company is a party
thereto in writing. All sub-agents shall be duly licensed under the
applicable insurance laws to sell annuity, life and health insurance
contracts by the proper authorities in the jurisdictions in which Agent
proposes to offer such Contracts. The sub-agents shall indicate in each
application for a Contract that it has been solicited on behalf of
Agent.
2.5.1 Agent shall supervise any sub-agents appointed by Agent to
solicit sales of the Contracts and Agent shall be responsible
for all acts and omissions of each sub-agent within the scope of
his agency appointment at all times. Agent shall exercise all
responsibilities required by the applicable federal and state
law and regulations. Company shall not have any responsibility
for the supervision of any sub-agents of Agent.
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2.5.2 Company may, by written notice to Agent, refuse to permit any
sub-agent to solicit applications for the sale of any of the
Contracts hereunder and may, by such notice, require Agent to
cause any such sub-agent to cease any such solicitation or
sales, and Company may require Agent to cancel the appointment
of any sub-agent with Company.
2.6 If Agent is assigned a different Agent Class for different Lines of
Business, the provisions of this Agreement, which specifically relate
only to a particular Agent Class, shall only apply to Agent in
transacting that Line of Business for which Agent is so classified, if
any.
3.0 COMPENSATION
3.1 Company will pay Agent as full compensation hereunder, commissions
and/or service fees on premiums paid to Company on account of Contracts
issued upon applications procured pursuant to this Agreement and while
this Agreement is in effect.
3.1.1 Commission and/or service fees will be paid in the amounts and
for the periods of time as set forth in the Commission Schedules
included in this Agreement or subsequently made a part hereof,
and which are in effect at the time such Contracts are sold.
3.1.2 The Commission Schedules included in this Agreement are subject
to change by Company at any time, but only upon written notice
to Agent. No such change shall affect any Contracts issued upon
applications received by Company at Company's Home Office prior
to the effective date of such change.
3.1.3 Any Commission Schedule included in this Agreement or
subsequently made a part hereof may provide other or additional
conditions regarding compensation and if so, will be controlling
to the extent of the other or additional conditions.
3.2 Compensation will be earned by Agent only for those applications
accepted by Company, and only after receipt by Company at Company's
Home Office in Hartford, Connecticut, or at such other location as the
Company may designate, from time to time, in regard to its various
lines of business, of the required premium and compliance by Agent with
any outstanding delivery requirements.
3.2.1 No compensation will be earned or paid on premiums (other than
premiums on health insurance contracts) waived by Company
pursuant to any "waiver of premium" provision.
3.2.2 Should Company for any reason return any premium on a policy
issued hereunder, Agent agrees to repay Company the total amount
of any compensation which may have been paid thereon within
thirty (30) business days of notice of such refund.
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3.3 Any compensation otherwise payable to Agent in accordance with this
Section 3.0 shall be reduced by the amount of such compensation paid
directly, at the direction of Agent, by Company to any person; in
connection with group policies, by the amounts paid by Company to a
resident licensed agent in a state which requires the countersignature
by, or the effectuating of the insurance through, a resident licensed
agent.
3.4 In the event of termination of this Agreement for one or more of the
reasons specified in Subparagraphs 6.2.2 or 6.2.3 below, no further
commissions or other compensation shall thereafter be payable.
3.5 In the event of termination in accordance with subsection 6.1 below if
in any calendar year following such termination the aggregate
commissions payable hereunder for all life and health policies total
less than $100.00, no further commissions shall be payable hereunder,
other references to vesting to the contrary not withstanding.
4.0 GENERAL PROVISIONS
4.1 Agent shall cooperate with Company in the investigation and settlement
of all claims against Agent and/or Company relating to the solicitation
or sale of Contracts under this Agreement. Agent shall promptly forward
to Company any notice of claim or other relevant information which may
come into Agent's possession.
4.2 Agent shall keep full and accurate records of the business transacted
by Agent under this Agreement and shall forward to Company such reports
of said business as Company may prescribe. Company shall have the right
to examine said records at reasonable times. All rate books, manuals,
forms, supplies and any other properties furnished by Company and in
the possession of Agent shall be returned to Company on termination of
this Agreement.
4.3 Agent shall bear all of Agent's expenses incurred in the performance of
this Agreement.
4.4 Agent shall have a duty to obtain applications for Company and, where
appropriate, to conserve and renew coverage placed with Company.
4.5 All applications for the purchase of Contracts shall be subject to
acceptance by Company. Company reserves the right to prescribe
conditions, rules and regulations for the offer and acceptance of its
Contracts, which may be changed from time to time and which shall be
forwarded to Agent.
4.6 Company reserves the right to modify, change or discontinue the
offering of any form of Contract at any time.
4.7 Except in regard to commission schedule changes as stated in subsection
3.1.2., no waiver or modification of this Agreement will be effective
unless it be in writing and signed by a duly authorized officer of
Company and Agent or a duly authorized officer of Agent.
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4.8 The failure of Company to enforce any provisions of this Agreement
shall not constitute a waiver of any such provision. The past waiver of
a provision by Company shall not constitute a course of conduct or a
waiver in the future of that same provision.
4.9 In the event any legal process or notice is served on Agent in a suit
or proceeding against Company, Agent shall forward forthwith such
process or notice to Company at its Home Office in Hartford,
Connecticut, by certified mail.
4.10 Agent shall not use any advertising material, prospectus, proposal, or
representation either in general or in relation to a Contract of
Company unless furnished by Company or until the consent of Company
shall have been first secured. Agent shall not issue or recirculate any
illustration, circular, statement or memorandum of any sort,
misrepresenting the terms, benefits or advantages of any Contract
issued by Company, or make any misleading statement as to benefits to
be received thereon, or as to the financial position of Company.
4.11 Agent shall indemnify and save Company harmless from any loss or
expense on account of any unauthorized act or transaction by Agent, or
persons employed or appointed by Agent, or any claim by a sub-agent of
Agent for compensation due or to become due on account of such sub-
agent's sale of Contracts.
4.11.1 Agent expressly authorizes Company to charge against all
compensation due or to become due to Agent under this Agreement
any monies paid or liabilities incurred by Company under this
Paragraph 4.11.
4.12 Company shall indemnify and save Agent harmless from any
liability resulting from damages sustained by a policy owner or
certificate owner caused by acts or omissions of Company: except
to the extent Agent's acts or omissions caused such liability.
Indemnification by Company is subject to the conditions that
Agent promptly notify Company of any claim or suit made against
Agent, and that Agent allow Company to make such investigation,
settlement, or defense thereof as Company deems prudent.
4.13 Except to the extent permitted by law, Agent shall not offer or
pay any rebate of premium or make any offer of any other
inducement not specified in the Contracts of any person to
insure with Company. Agent shall not make any misrepresentation
or incomplete comparison for the purpose of inducting a
policyholder in any other company to lapse, forfeit or surrender
its insurance therein.
4.14 No assignment of this Agreement, or commissions payable
hereunder, shall be valid unless authorized in writing by
Company. Every assignment shall be subject to any indebtedness
and obligation of Agent that may be due or become due to Company
and any applicable state insurance regulations pertaining to
such assignments.
4.15 Company may at any time deduct, from any monies due under this
Agreement, every indebtedness or obligation of Agent to Company
or to any of its affiliates.
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4.15.1 On termination of this Agreement, any outstanding
indebtedness to Company shall become immediately due
and payable.
5.0 LIMITATION OF AUTHORITY
5.1 Agent is not authorized, and is expressly forbidden on behalf of
Company, to incur any indebtedness or liability, or to make, alter or
discharge agreements, or to waive forfeitures, extend the time of
payment of any premium, waive payment in cash, or to receive any money
due or to become due Company, except as specifically provided in this
Agreement.
5.2 No individual Contract providing life, health or disability insurance
coverage shall be delivered if a sub-agent or Agent has knowledge that
the health of the proposed insured has changed since the application
was taken or unless the first premium has been fully paid and delivery
made by the delivery date specified by Company or, if no delivery date
is specified, within sixty (60) days from the date said Contract is
mailed from Company's Home Office.
5.2.1 Any Contract not delivered, in accordance with this Subsection
5.2, shall be returned to Company immediately.
6.0 TERMINATION
6.1 This entire Agreement may be terminated by either party by giving
thirty (30) days' notice in writing to the other party.
6.1.1 Such notice of termination shall be mailed to the last known
address of Agent appearing on Company's records, or in the event
of termination by Agent, to the Home Office of Company at P.O.
Box 2999, Hartford, Connecticut 06104-2999.
6.1.2 Such notice shall be an effective notice of termination of this
Agreement as of the time the notice is deposited in the United
States mail or the time of actual receipt of such notice if
delivered by means other than mail.
6.2 This Agreement shall automatically terminate without notice upon the
occurrence of any of the events set forth below:
6.2.1 Upon the bankruptcy or dissolution of Agent provided, however,
that if there is more than one Agent, the Agreement shall
automatically terminate only with respect to the bankrupt or
dissolved Agent.
6.2.2 When and if Agent commits fraud or gross negligence in the
performance of any duties imposed upon Agent by this Agreement
or wrongfully withholds or misappropriates, for Agent's own use,
funds of Company, its policyholders or applicants.
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6.2.3 When and if Agent materially breaches this Agreement or
materially violates the insurance or Federal or State securities
laws of a state in which Agent transacts business.
6.2.4 When and if Agent fails to obtain renewal of a necessary license
in any jurisdiction, but only as to that jurisdiction.
6.3 The provisions of Sections 3.0, 4.0 and 5.0 and Subsection 7.5
(if applicable) shall survive the termination of this Agreement,
as appropriate.
7.0 SEC REGISTERED CONTRACTS (If Applicable)
7.1 If Agent is listed on the Specifications Page as a Broker or General
Agent and an NASD registered Broker-Dealer, Agent agrees that, with
respect to SEC Registered Contracts, Agent has full responsibility for
the training and supervision of all persons, including sub-agents of
Agent, associated with Agent who are engaged directly or indirectly in
the offer or sale of such Contracts and that all such persons shall be
subject to the control of Agent with respect to such persons'
activities in connection with the Contracts. Agent will cause the
sub-agents to be trained in the sale of the Contracts and will cause
such sub-agents to be registered representatives of Agent before such
sub-agents engage in the offer or sale of the Contracts. Agent shall
cause Agent's sub- agents' qualifications to be certified to the
satisfaction of Company and shall notify Company if any sub-agents
cease to be registered representatives of Agent.
7.1.1 Agent will fully comply with the requirements of the National
Association of Securities Dealers, Inc. and of the Securities
Exchange Act of 1934 and all other applicable federal or state
laws and will establish such rules and procedures as may be
necessary to cause diligent supervision of the securities
activities of the sub-agents. Upon request by Company, Agent
shall furnish any records necessary to establish such diligent
supervision.
7.1.2 Before a sub-agent is permitted to solicit and procure
applications for the Contracts, Agent and the sub-agent shall
have entered into an agreement pursuant to which the sub-agent
will be appointed a sub-agent and a registered representative of
Agent and in which the sub-agent will agree that his selling
activities relating to the Contracts will be under the
supervision and control of Agent, and the sub-agent's right to
continue to sell such Contracts is subject to his continued
compliance with such agreement.
7.1.3 In the event a sub-agent fails or refuses to submit to
supervision of Agent in accordance with this Agreement, or
otherwise fails to meet the rules and standards imposed by
Agent, Agent shall immediately notify such sub-agent that he is
no longer authorized to sell the Contracts, and Agent shall take
whatever additional action may be necessary to terminate the
sales activities of such sub-agent relating to the Contracts
including immediate notification of Company of such termination.
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7.2 If Agent is not an NASD Registered Broker/Dealer but is a member of an
affiliated group of legal entities one of which is an NASD Registered
Broker/Dealer ("Broker/Dealer") and a party to this Agreement, Agent
agrees that, with respect to SEC Registered contracts, the sub-agents
of Agent shall be registered representatives of such Broker/Dealer.
7.2.1 As appropriate, any reference in this Agreement to Agent shall
apply equally to such Broker/Dealer.
7.2.2 Each Agent which is not a Broker/Dealer hereby directs Company
to pay any compensation due, pursuant to Paragraph 3, to the
Broker/Dealer.
7.2.3 If Agent is not a Broker/Dealer but is a member of an affiliated
group of legal entities, one of which is a Broker/Dealer and a
party to this Agreement, Agent and Broker/Dealer agree that,
with respect to SEC Registered Contracts, Agents and
Broker/Dealer have responsibility for the training and
supervision of all registered representatives of Broker/Dealer
and who are sub-agents of Agent and who are engaged directly and
indirectly in the offer or sale of such SEC Registered Contracts
and that all such representatives shall be subject to the
control of Agent and Broker/Dealer with respect to their
activities in connection with the SEC Registered Contracts.
7.3 If Agent is neither an NASD Registered Broker-Dealer nor a member of an
affiliated group of legal entities one of which is a Broker/Dealer,
Agent and any sub-agents shall be registered representatives of
Hartford Equity Sales Company, Inc.
7.4 The provisions of this Subsection 3.5 do not apply to the sale of SEC
Registered Contracts.
7.5 With respect to SEC Registered Contracts, if Agent is disqualified for
continued registration with the NASD, Company shall not be obligated to
pay any compensation, if such payment would constitute a violation of
NASD rules.
7.6 In respect to SEC Registered Contracts, Agent agrees not to make
written or oral representations except such as are contained in current
prospectuses and authorized supplementary sales literature made
available by Company. Agent also agrees to comply with the Securities
and Exchange Commission Statement of Policy and the regulations
thereunder of the National Association of Securities Dealers, Inc.
7.7 As to SEC Registered Contracts only, when and if Agent is disqualified
for continued membership with the NASD or registration with the
Securities and Exchange Commission, this Agreement shall automatically
terminate without notice.
7.8 All other provisions of this Agreement apply to the sale of SEC
Registered Contracts.
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