DISTRIBUTION AGREEMENT
For Sales of
Protective Life Insurance Company
Registered Annuity Contracts
THIS DISTRIBUTION AGREEMENT ("Agreement") is hereby entered into on this
____ day of ________________, 19__, between INVESTMENT DISTRIBUTORS, INC.
("IDI"), a Broker-Dealer organized and existing under the laws of the State of
Tennessee and _______________________________ ("Broker-Dealer"), organized and
existing under the laws of the State of _____________________.
WITNESSETH:
WHEREAS, IDI is registered as a broker-dealer under the Securities Exchange
Act of 1934, as amended, and is a member of the National Association of
Securities Dealers, Inc. ("NASD").
WHEREAS, PROTECTIVE LIFE INSURANCE COMPANY ("PROTECTIVE") has appointed IDI
as the principal underwriter of certain annuity contracts to be issued by
PROTECTIVE.
WHEREAS, the parties hereto desire that Broker-Dealer and its registered
representatives who are duly licensed and qualified under applicable securities
and insurance laws, rules and regulations be authorized to offer and sell the
Contracts to the general public subject to the terms and conditions contained in
this Agreement.
NOW THEREFORE, in consideration of the foregoing and of the mutual
covenants, conditions and terms set forth in this Agreement, the parties hereby
agree as follows:
ARTICLE I
APPOINTMENT
1. IDI, as principal underwriter, hereby appoints Broker-Dealer to
distribute certain annuity contracts (the "Contracts") set forth on the Product
Schedule, Schedule 2 to this Agreement. IDI and/or PROTECTIVE may amend or
modify the Product Schedule at any time, effective upon mailing written notice
to Broker-Dealer.
2. Broker-Dealer is an independent contractor and nothing in this or any
other agreement between the parties shall be construed to create the
relationship of employee and employer between Broker-Dealer, IDI and PROTECTIVE.
As an independent contractor it is contemplated that Broker-Dealer may represent
other insurance companies.
ARTICLE II
LICENSING
1. Broker-Dealer will at all times be duly registered as a Broker-Dealer
under the Securities Exchange Act of 1934 and in each state or other
jurisdiction in which Broker-Dealer acts hereunder in connection with sales of
the Contracts or the supervision of registered representatives who perform such
activities on behalf of Broker-Dealer.
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2. Broker-Dealer will be solely responsible for ensuring that none of its
registered representatives shall offer or sell the Contracts until such
individuals are associated, licensed, and duly registered with the NASD and any
applicable state securities and insurance authorities.
3. Broker-Dealer will assist IDI and PROTECTIVE in the appointment of
registered representatives under the applicable insurance laws to sell the
Contracts. IDI and PROTECTIVE in its or their sole discretion, may refuse to
appoint and may terminate the appointment of any registered representative.
ARTICLE III
COMPLIANCE
1. Broker-Dealer shall fully comply with the requirements of the NASD,
the Securities Exchange Act of 1934, the Securities Act of 1933, and the
Investment Company Act of 1940 and all other applicable federal or state laws
governing the activities of Broker-Dealer regarding the Contracts.
2. Broker-Dealer will establish such rules and procedures as required to
ensure diligent supervision of the securities activities of registered
representatives in regards to the Contracts.
3. In the event a registered representative of Broker-Dealer fails to
observe the standards and rules imposed by Broker-Dealer and IDI regarding the
sales of the Contracts, Broker-Dealer shall notify IDI immediately that such
registered representative is no longer authorized to sell the Contracts.
Broker-Dealer shall take whatever action is necessary to terminate the sales
activities of registered representative regarding the Contracts.
4. Broker-Dealer shall have sole responsibility for the training and
supervision of all registered representatives associated with Broker-Dealer who
are engaged directly or indirectly in the offer or sale of the Contracts.
Broker-Dealer shall supervise all registered representatives' compliance with
applicable federal and state securities laws, applicable state insurance laws
and regulations, and NASD requirements in connection with such solicitation
activities. All such registered representatives shall be subject to the control
of Broker-Dealer with respect to such registered representatives'
securities-regulated activities in connection with the Contracts.
5. Broker-Dealer will cause its registered representatives to be trained
in the sale of the Contracts and will cause such representatives to limit
solicitation of applications for the Contracts to jurisdictions where IDI has
authorized such solicitation.
ARTICLE IV
APPLICATIONS; ANNUITY DEPOSITS
1. All applications for the Contracts shall be made on such forms as
authorized by IDI or PROTECTIVE.
2. Broker-Dealer shall be responsible for reviewing each application for
completeness and suitability. All applications are subject to rejection or
acceptance by PROTECTIVE, in its sole discretion.
3. All checks and/or payments for Annuity Deposits for the Contracts
shall be made payable to PROTECTIVE LIFE INSURANCE COMPANY.
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4. Broker-Dealer agrees that it and its registered representatives:
i) shall not solicit applications for the Contracts without
delivering to the applicant solicited a current prospectus;
ii) shall recommend the purchase of a Contract only if reasonable
grounds exist that the Contract is suitable for the applicant
in accordance with, applicable federal and state laws,
regulations and the rules of the NASD. While not limited to
the following; a determination of suitability shall be based on
a reasonable inquiry concerning the applicant's insurance and
investment objectives and financial situation and needs and
shall entail a review by Broker-Dealer of all applications for
suitability and completeness and correctness as to form;
iii) shall only accept Annuity Deposits for the Contracts in the
form of a check or money order made payable to Protective Life
Insurance Company and signed by the applicant;
iv) shall have no authority to endorse checks or money orders made
payable to Protective Life Insurance Company;
v) shall have no authority to alter, modify, waive or change any
of the terms, rates, charges or conditions of the Contracts;
and
vi) shall deliver Contracts only in accordance with PROTECTIVE'S
instructions.
ARTICLE V
SALES MATERIALS
IDI shall provide Broker-Dealer, without any expense to Broker-Dealer,
prospectuses and consumer brochures for use with the Contracts. No sales or
promotional materials, advertisements, circulars or documents regarding the
Contracts can be utilized by Broker-Dealer and/or its registered representatives
unless approved in writing by IDI and/or PROTECTIVE.
ARTICLE VI
COMPENSATION
1. During the term of this Agreement, IDI agrees to pay compensation to
Broker-Dealer as set forth on the Compensation Schedule(s), Schedule 1 to this
Agreement. IDI and/or PROTECTIVE may amend or modify the Compensation Schedule
at any time, effective upon mailing written notice to Broker-Dealer.
2. Broker-Dealer shall be solely responsible for the payment of any
commission or consideration of any kind to its registered representatives with
respect to sales of the Contracts.
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ARTICLE VII
TERMINATION
1. This Agreement may be terminated by IDI or by Broker-Dealer, without
cause, upon thirty days written notice by either party to the other party to the
last known address of such other party.
2. This Agreement may be terminated for cause by IDI immediately upon the
mailing of written notice of termination for cause. IDI's determination of what
constitutes termination for cause shall be conclusive between the parties
hereto.
3. Termination of this Agreement shall automatically terminate any
schedules, supplements, addenda or amendments made a part of this Agreement.
4. Upon termination of this Agreement, Broker-Dealer agrees to return to
IDI all equipment and supplies regarding the Contracts in Broker-Dealers
possession which are the property of IDI.
ARTICLE VIII
GENERAL PROVISIONS
1. NOTICES. All notices or communications shall be sent to the parties
at the addresses shown in this Agreement. Any changes to these addresses must
be made in writing and sent to the other party in accordance with this
paragraph.
2. GOVERNING LAW. This Agreement shall be construed in accordance with
and governed by the laws of the State of Alabama.
3. BINDING EFFECT. This Agreement shall be binding on and shall inure to
the benefit of the parties to it and their respective successors and assigns.
4. SEVERABILITY. If any provision of this Agreement is held or made
invalid by a court decision, statute, rule or otherwise, the remainder of the
Agreement shall not be affected thereby.
5. CONFIDENTIALITY. Each party to this Agreement shall maintain the
confidentiality of any proprietary information that it may acquire in the
performance of this Agreement and shall not use such proprietary information
without the prior written consent of the other party and PROTECTIVE.
6. COMPLAINTS AND INVESTIGATIONS.
(i) Broker-Dealer and its registered representatives each
shall cooperate fully in any securities or insurance
regulatory investigation or proceeding or judicial
proceeding arising in connection with the Contracts
marketed under this Agreement. Broker-Dealer will be
notified promptly of any customer complaint or notice of
any regulatory investigation or proceeding or judicial
proceeding received by IDI or PROTECTIVE with respect to
Broker-Dealer, or any of its individual registered
representatives; and Broker-Dealer will promptly notify
IDI and PROTECTIVE of any written customer complaint or
notice of any regulatory investigation or proceeding or
judicial proceeding received by Broker-Dealer or any of
its individual registered representatives with respect
to themselves in connection with this Agreement or any
Contract.
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(ii) In the case of a customer complaint, IDI, PROTECTIVE and
Broker-Dealer will cooperate in investigating such
complaint and any response by Broker-Dealer or any of
its registered representatives to such complaint will be
sent to IDI and PROTECTIVE for approval not less than
five business days prior to its being sent to the
customer or regulatory authority, except that if a more
prompt response is required, the proposed response shall
be communicated by telephone or facsimile.
7. AMENDMENT, MODIFICATION AND ASSIGNMENT. This Agreement supersedes all
prior agreements, either oral or written, between the parties relating to the
Contracts. Except as provided in Articles I, VI, and VIII.1, this Agreement may
be amended, modified or assigned only by written agreement signed by all of the
parties. Failure of PROTECTIVE to insist on strict compliance with any
provision of this Agreement or rule of PROTECTIVE shall not constitute a waiver
of the provision or rule.
8. INDEMNIFICATION BY BROKER-DEALER. Broker-Dealer agrees to indemnify
and hold IDI and PROTECTIVE harmless from any and all losses, claims, damages or
liabilities, joint or several (including but not limited to any investigative,
legal and other expenses reasonably incurred in connection with, and any amounts
paid in settlement of, any action, suit or proceeding or any claim asserted), to
which they or any of them may become subject under any statute or regulation, at
common law or otherwise, insofar as such losses, claims, damages or liabilities
arise out of or are based upon:
(i) violation(s) by Broker-Dealer, its registered representatives,
of federal or state securities law or regulation(s), insurance
law or regulation(s), or any rule or requirement of the NASD in
regards to the Contracts;
(ii) any unauthorized use of promotional, sales or advertising
material, any oral or written misrepresentations, or any
unlawful sales practices concerning the Contracts by
Broker-Dealer or its registered representatives;
(iii) claims by registered representatives of Broker-Dealer for
commissions or other compensation or remuneration of any type;
(iv) any failure on the part of Broker-Dealer, or its registered
representatives, to submit Annuity Deposits or applications to
PROTECTIVE or to submit the correct amount of an Annuity
Deposit, on a timely basis and in accordance with this
Agreement and PROTECTIVE'S procedures, subject to applicable
law;
(v) any failure on the part of Broker-Dealer, or its registered
representatives, to deliver Contracts to purchasers thereof on
a timely basis and in accordance with PROTECTIVE'S procedures;
(vi) any breach by Broker-Dealer or its registered representatives
of any provision of this Agreement; or
(vii) Broker-Dealer's and/or its registered representatives,
unauthorized acts or transactions.
This indemnification will be in addition to any liability that
Broker-Dealer and its registered representatives may otherwise have.
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9. ARBITRATION. All disputes, controversies or differences that arise under
or are related to this Agreement shall be determined by arbitration in
accordance with the Code of Arbitration Procedure of the National Association of
Securities Dealers. The cost of arbitration, including the fees of the
arbitrators and attorneys' fees, shall be borne by the losing party unless the
arbitrators decide otherwise.
INVESTMENT DISTRIBUTORS, INC.
0000 Xxxxxxx 000 Xxxxx
Xxxxxxxxxx, XX 00000
By:
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Title:
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Date:
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(Broker-Dealer)
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(Address)
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(Address)
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(City, State, Zip Code)
By:
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Title:
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Date:
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