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Exhibit 3
GENERAL AGENT AGREEMENT
THIS AGREEMENT, effective this _____ day of _________________, is made by and
among Nationwide Life Insurance Company, Nationwide Life and Annuity Insurance
Company, (collectively, "Nationwide") XXXXXXX & XXXX, INC. on its own behalf and
on behalf of its affiliated Corporate Insurance Agencies (Collectively referred
to as "Agency") and ("Broker/Dealer").
Nationwide hereby appoints Broker/Dealer and Agency (collectively, "General
Agent") as General Agent with the rights, powers, duties and liabilities set
forth herein. General Agent hereby accepts the appointment.
General Agent acknowledges, understands and agrees that although Nationwide Life
Insurance Company ("NWL") and Nationwide Life and Annuity Insurance Company
("NWLAIC") are collectively referred to herein as "Nationwide", NWL and NWLAIC
are separate corporate entities, and that the rights and obligations of each
under this Agreement are to be exclusively determined on the basis of which of
the two entities (NWL or NWLAIC) is the issuing company of the product(s)
specified in Exhibit A, and being sold pursuant to this Agreement.
Nationwide acknowledges, understands and agrees that although Broker/Dealer and
its affiliated Corporate insurance agencies are collectively, referred to herein
as "General Agent", Broker/Dealer and each of the Corporate insurance agencies
are separate corporate entities, and that the rights and obligations of each
under this Agreement are to be exclusively determined on the basis of which of
the entities is acting as agent with respect to the product(s) specified in
Exhibit A and being sold pursuant to this Agreement.
IN CONSIDERATION OF THE MUTUAL PROMISES HEREIN MADE, THE PARTIES AGREE AS
FOLLOWS:
1. SCOPE. This Agreement shall supersede the General Agent Agreement by
and between Nationwide Life Insurance Company, Nationwide Life and
Annuity Insurance Company, and Xxxxxxx & Xxxx, Inc. dated December 6,
1999, and all other prior agreements between the parties, with respect
to the matters addressed herein. All of the insurance or annuity
products sold under this Agreement shall be referred to as
"Contract(s)" except when particular provisions relate solely to
variable contracts required to be registered under the Securities Act
of 1933 ("1933 Act") and/or the Investment Company Act of 1940 ("1940
Act") and such contracts shall be referred to as "Variable Contracts".
The Contracts which may be sold under this Agreement are listed in the
Compensation Schedules which are included in Exhibit A. These
Compensation Schedules may be amended upon written agreement of
Nationwide and General Agent.
In consideration of the services to be performed hereunder, Nationwide
agrees to pay General Agent compensation, in accordance with the
Exhibits to this Agreement, as may be amended from time to time by
mutual written agreement of the parties, based on purchase payments due
and received by Nationwide on Contracts issued upon applications
submitted either directly or through registered representatives and
agents, on or after the date of this Agreement.
2. EXCLUSIVITY. Except as otherwise provided herein, Nationwide will be
the exclusive provider to General Agent of the products specified in
Exhibit B for a period of five- (5) years. During this five- (5) year
period, General Agent will not
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offer any other competitor's products to their clients, except as
otherwise provided herein. Notwithstanding the foregoing, this
exclusivity provision will not apply to (a) clients transferring
similar investment products from one investment advisor and/or
broker-dealer to General Agent, but only to the extent of the transfer
itself, (b) products offered by General Agent's former affiliate,
United Investors Life Insurance Company, (c) additions made by General
Agent clients to products owned prior to the commencement of
distribution of like Nationwide products by General Agent pursuant to
this agreement, (d) sales made in New York prior to the development by
Nationwide of replacement products for sale in New York, and (e) sales
made by new General Agent financial advisors to prospects to which
non-Nationwide products were offered prior to their engagement by
General Agent. General Agent will make a good faith effort to monitor
and report these exceptions to ensure that the principle of overall
exclusivity is maintained.
Nationwide will provide sufficient resources to fulfill mutually agreed
upon product feature, support and service level standards. It is
understood and agreed that such exclusivity shall terminate at General
Agent's option if (a) Nationwide fails to meet the agreed upon product
feature, support and service standards and (b) Nationwide experiences a
change of control involving an unaffiliated organization. Nationwide
may also terminate its exclusive relationship with General Agent if
General Agent fails to meet its obligations as set forth herein.
Notwithstanding the foregoing, if General Agent experiences a change of
control involving an unaffiliated organization and such organization
desires for General Agent to sell its products or the products of one
or more of its affiliates ("Acquirer Products"), this exclusivity
provision will not apply to the Acquirer Products. It is understood and
agreed that if such a change of control should occur, and General Agent
commences offering Acquirer Products, General Agent shall use its best
efforts to insure that Nationwide's products receive and maintain an
equitable competitive position in General Agent's distribution system
throughout the exclusive period. For purposes of this provision, an
"equitable competitive position" shall mean, the opportunity for
Nationwide to provide products with substantially similar costs,
features commissions, fund diversification and positioning as the
Acquirer Products. In the event such a change of control occurs and
General Agent commences offering Acquirer Products, the exception from
this exclusivity provision identified in section (b) of the previous
paragraph, regarding a change of control at Nationwide involving an
unaffiliated organization, shall cease to apply.
3. AUTHORITY. Agency and Broker/Dealer are hereby authorized, through
their individual agents ("Agents"), representatives or duly licensed
affiliated agencies who are duly licensed and registered as required by
law, to solicit and procure applications for the Contracts in
accordance with the terms and conditions of this Agreement, and are
authorized in connection therewith:
a. to collect purchase payments on Contracts for which
applications are submitted;
b. when requested and as directed by Nationwide to deliver
Contracts after the terms and conditions governing such
delivery are completed, provided that no such delivery of a
Contract shall be deemed to constitute a warranty by General
Agent that such terms and conditions have been complied with;
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c. to perform any other act related to the Contracts that is
authorized in writing by Nationwide and is permissible under
the law; and
d. General Agent will pay all fees required to obtain and/or
maintain any licenses or registrations required by state or
federal law for General Agent and agents of General Agent.
Nationwide will pay the fees in connection with the initial
appointment with Nationwide of agents of General Agent. Any
subsequent appointment fees will be the responsibility of the
General Agent or as mutually agreed upon with Nationwide.
4. Right to Sell; Regulatory Approvals.
a. General Agent is authorized to sell the Contracts set forth in
the Compensation Schedule (Exhibit A) as now and hereafter
attached to this Agreement. The Compensation Schedule is
hereby incorporated by reference.
b. Except as disclosed to General Agent in writing, Nationwide
represents and warrants that it has the authority to issue
Contracts in the states where the General Agent is authorized
to conduct business. Nationwide agrees to notify General Agent
promptly of any change in such authority.
General Agent agrees that it will solicit applications for
Nationwide only in those states in which such Contracts are
approved.
c. General Agent will not solicit applications in any state
unless the Agent signing the application has been properly
licensed by the appropriate regulatory agency in that state,
which may include registrations as a registered representative
of Broker/Dealer if Variable Contracts are being sold. As a
licensed appointee of Nationwide, General Agent will comply
with the statutory and regulatory obligations related to the
solicitation and procurement of applications for Contracts.
d. If General Agent engages in sales of the Contracts on the
premises of or in cooperation with financial institutions
(including banks, savings and loan institutions, or credit
unions), General Agent shall, as required by applicable law,
maintain separation of its business from the business of such
financial institution, including separation of records.
General Agent shall also conduct its business at all times so
as not to lead to confusion between the business conducted by
General Agent and the business conducted by the financial
institution.
The parties to the Agreement hereby agree to abide by,
observe, and otherwise conduct the business contemplated under
the Agreement in a manner consistent with the Guidelines set
forth in the Interagency Statement on Retail Sales of
Non-Deposit Investment Products, issued jointly by the Board
of Governors of the Federal Reserve System, the Federal
Deposit Insurance Corporation, the Office of the Comptroller
of the Currency, and the Office of Thrift Supervision on
February 15, 1994, or any modifications or interpretations
thereof.
5. AGENT SUPERVISION
a. Before an Agent is permitted to solicit and procure
applications for the Contracts, General Agent and Agent shall
have entered into an agreement pursuant to which such Agent
will be appointed as an agent
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of General Agent and in which Agent will agree that Agent's
selling activities relating to the Contracts will be under the
supervision and control of General Agent. The Agent's right to
continue to sell the Contracts is subject to Agent's continued
compliance with such agreement.
b. If an Agent fails to meet the rules and standards imposed by
General Agent, General Agent shall take such disciplinary
action as it deems appropriate. If an Agent fails or refuses
to submit to supervision of General Agent in accordance with
this Agreement, General Agent shall immediately notify such
Agent that such Agent is no longer authorized to sell the
Contracts and shall take whatever additional action may be
necessary to terminate the sales activities of such Agent
relating to the Contracts including immediate notification to
Nationwide of such termination.
c. In the event that General Agent regards itself as exempt from
the licensing requirements of a state insurance authority,
then General Agent hereby warrants and guarantees that it
shall exercise supervisory control over the training and
conduct of its Agents in a manner consistent with state
insurance requirements with respect to fair, accurate and good
faith representations of product information in the
solicitation process, with due regard to the financial status
of individual consumers and the appropriateness of the
Contract as an investment for such individual consumers. Any
intentional or negligent failure in this regard, by any Agent
of General Agent, shall require General Agent to immediately
terminate such Agent's ability to sell the Contracts and to
notify Nationwide of such termination. In addition, General
Agent will ensure that its Agents comply with all applicable
state insurance requirements and have obtained and maintain
any security licenses required by the state insurance
authorities.
6. SALE OF VARIABLE CONTRACTS.
a. General Agent agrees that each Agent who sells Variable
Contracts will be a registered representative of Broker/Dealer
(for purposes of this section, "Registered Representative")
with the National Association of Securities Dealers Inc. (the
"NASD") before the Agent engages in the offer and sale of
Variable Contracts. Broker/Dealer shall certify the status of
each Registered Representative's qualifications to
Nationwide's satisfaction and shall notify Nationwide if any
such person ceases to be a Registered Representative of
Broker/Dealer.
b. Broker/Dealer shall have full responsibility for the training
and supervision of the Registered Representatives that offer
and sell the Variable Contracts. This training shall include
training in the sale of variable contracts. All Registered
Representatives shall be subject to the control of
Broker/Dealer in connection with the offer and sale of such
Variable Contracts.
c. Broker/Dealer will fully comply with the requirements of the
NASD, 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 Registered
Representatives. Broker/Dealer shall furnish records necessary
to document such supervision at Nationwide's reasonable
request.
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d. Before a Registered Representative is permitted to solicit and
procure applications for the Variable Contracts, Broker/Dealer
and the Registered Representative shall have entered into an
agreement pursuant to which the Registered Representative will
become a Registered Representative of Broker/Dealer and will
agree that their selling activities relating to the Variable
Contracts will be under the supervision and control of
Broker/Dealer. The right to continue to sell such Variable
Contracts is subject to continued compliance with such
agreement.
e. If a Registered Representative fails to meet the rules and
standards imposed by Broker/Dealer, Broker/Dealer shall take
such disciplinary action as it deems appropriate. If a
Registered Representative fails or refuses to submit to
supervision of Broker/Dealer in accordance with this
Agreement, Broker/Dealer shall immediately notify such
Registered Representative that he is no longer authorized to
sell the Variable Contracts, and Broker/Dealer shall take
whatever additional action may be necessary to terminate the
sales activities of such Registered Representative relating to
the Variable Contracts including immediate notification to
Nationwide of such termination.
f. Nationwide represents that (a) the Variable Contracts are
properly registered under the 1933 Act and/or 1940 Act and the
registration statements and the Variable Contracts will remain
in full force and effect for the duration of this Agreement,
and (b) the Variable Contracts are exempted or excepted from
registration under state securities laws. If any state should
amend its current securities laws to require registration of
insurance contracts, then Nationwide will comply with the
amended state law.
g. In connection with the conduct of its business, Broker/Dealer
shall be provided with prospectuses relating to the Variable
Contracts and such other material as Nationwide determines to
be necessary. Nationwide represents and warrants to
Broker/Dealer that all prospectuses and other material, which
Nationwide makes available to Broker/Dealer will comply in all
respects with any and all applicable federal and state
securities laws.
7. INDEPENDENT CONTRACTOR.
General Agent is free to exercise its own judgment as to the persons
from whom it will solicit applications for Contracts as well as the
time, manner and place of solicitation, and Nationwide will not
unreasonably interfere with its activity or manner of performance under
this Agreement as an independent contractor.
Nothing contained in this Agreement shall create, or shall be construed
to create, the relationship of an employer and employee between
Nationwide and General Agent.
8. COLLECTION OF PURCHASE PAYMENTS.
All Contract purchase payments on applications procured by or through
General Agent, which General Agent may collect, are collected on behalf
of Nationwide. All purchase payments shall be in check or wire
transfer. All such monies received by General Agent shall be collected
and transmitted promptly to Nationwide in a manner agreed to by both
General Agent and Nationwide.
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9. LIMITATIONS ON AUTHORITY. Unless otherwise authorized by Nationwide in
writing pursuant to Section 3(c), General Agent shall have no authority
on behalf of Nationwide to:
a. make, alter or discharge any Contract,
b. incur any indebtedness or liability, expend or contract for
the expenditure of funds of Nationwide,
c. extend the time for payment of any purchase payment, bind
Nationwide to the reinstatement of any terminated Contract, or
accept notes for payment of purchase payments,
d. waive or modify any terms, conditions or limitations of any
Contract, adjust or settle any claim or commit Nationwide with
respect thereto except as provided in Section 13 c.,
e. enter into legal proceedings in connection with any matter
pertaining to Nationwide's business without the prior written
consent of Nationwide unless General Agent is named in such
proceedings or General Agent could be subject to paying all or
a part of any judgment. General Agent must immediately give
Nationwide written notification of the legal proceeding. Where
General Agent is either named or may be subject to paying all
or a portion of any judgment, General Agent may retain counsel
of its choice,
f. use the registered marks of Nationwide without receiving prior
written approval of Nationwide,
g. represent products of Nationwide except as reflected in the
prospectus,
h. advertise or publish any matter or thing concerning Nationwide
or the Contracts without the prior written permission of
Nationwide, except as provided in Section 14.a.,
i. open any bank account or trust account on behalf of, for the
benefit of, or containing the name of Nationwide,
j. directly or indirectly cause or endeavor to cause any General
Agent or their Agents to terminate or alter their association
with Nationwide, or will not advise or encourage any
Nationwide Contract Owner to relinquish, surrender, replace or
lapse their Nationwide contract unless such action is in the
best interest of the Contract Owner as reasonably determined
by the General Agent,
k. do or perform any acts or things other than expressly
authorized herein.
10. AGENTS.
a. General Agent shall select Agents subject to the provisions of
this Agreement and Nationwide shall appoint the selected
Agents or provide to General Agent in writing a reasonable
basis for not making such appointment. General Agent shall
notify Nationwide promptly, in writing, upon the giving or
receipt of any notice of termination of an Agent. General
Agent will provide Nationwide with any documentation necessary
for the appointment of the Agents. Nationwide reserves the
right to terminate the appointment of any Agent in its
reasonable discretion. Nationwide will promptly notify the
General Agent of the termination of the appointment of any
Agent and the basis therefor.
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b. At all times during which an Agent is appointed by Nationwide
to sell Contracts, General Agent shall ensure that each Agent
has obtained and maintains all applicable licenses in
accordance with applicable state and federal laws and
regulations. General Agent shall provide Nationwide on request
evidence of applicable insurance licenses of General Agent's
Agents.
c. General Agent maintains the responsibility to ensure its
Agents comply with the terms of the Agreement.
11. COMPENSATION.
a. Nationwide agrees to pay General Agent compensation, in
accordance with the Compensation Schedules to this Agreement
as may be amended from time to time by mutual written
agreement of the parties.
b. Nationwide will pay all compensation due General Agent or any
Agents, either directly to General Agent or, as necessary to
meet legal requirements, to the licensed General Agent
affiliate or other affiliated entity which is permitted to
receive such compensation under applicable state law. In
states where corporate licenses are not granted, General Agent
represents and warrants that it or its affiliated entity has
the necessary relationship with the Agents based upon which
such affiliated entity is permitted to receive compensation
under applicable state insurance law except as otherwise
approved by Nationwide. General Agent hereby warrants that all
necessary contractual arrangements are in place to enable
Nationwide to pay General Agent, or any of its affiliates, for
business produced by Agents in the jurisdiction in which they
hold licenses. General Agent shall pay all compensation due to
Agents or any other person with respect to the Contracts, and
no such Agent or other person shall have any claim against
Nationwide on account of the sale or service of any Contract.
Nationwide shall have no obligation to make compensation
payments except as provided above. If Nationwide permits the
General Agent to retain compensation before remitting purchase
payments, then the Net Compensation Addendum shall specify
that authority. Should Nationwide pay General Agent for
premiums later returned or credited to the customer or any
other overpayment to General Agent, Nationwide shall have, in
addition to all other creditor rights, the right to deduct
such overpayment from any current or future compensation due
General Agent.
c. All trail commissions, if any, shall be paid by Nationwide to
General Agent with respect to all Contracts sold by Agents on
or before the date of termination of this Agreement. In the
event Nationwide receives written authorization from an
appointed officer of the General Agent to transfer a Contract
paying trail commissions to a new General Agent, all
subsequent trail commissions as of the effective date of the
transfer will be paid to the new General Agent of record. In
the event Nationwide receives a written request from a
contract owner to transfer a contract to a new General Agent,
all subsequent trail commissions as of the effective date of
the transfer will be paid to the new General Agent of record.
This paragraph shall not be in derogation of any right of
offset or other remedy Nationwide may have on monies owed by
General Agent or by the new General Agent of record. General
Agent agrees to maintain any or all federal or state license
and appointment including any applicable renewal fees
required, except to the extent Nationwide is responsible
therefor
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pursuant to this Agreement, in order to receive trail
commissions from Nationwide.
d. Notwithstanding any other provisions of this Agreement
Nationwide shall not be obligated to pay any compensation
which would be in violation of the applicable laws, rules or
regulations of any jurisdiction, subject to Section 13 of this
Agreement.
12. SEGREGATED BANK ACCOUNT.
All purchase payments received by General Agent on behalf of
Nationwide, including purchase payments received by General Agent from
Agents, shall be held in a segregated bank account and shall be
forwarded to Nationwide in accordance with mutually agreed upon
instructions.
13. INDEMNIFICATION.
a. Nationwide agrees to indemnify and hold General Agent harmless
from any and all losses, claims, damages, liabilities or
expenses to which General Agent may become subject under any
statute, regulation, common law or otherwise, insofar as such
losses, claims, damages, liabilities or expenses relate
directly to the sale of the Contracts and arise as a direct
consequence of:
1) any material misrepresentation or omission, or
alleged misrepresentation or omission, contained in
the registration statement, prospectuses, the
Contracts, this Agreement or any other document
prepared or distributed by Nationwide including, but
not limited to, advertising or sales literature;
2) any failure by Nationwide or its employees, whether
negligent or intentional, to perform the duties and
discharge the obligations contemplated in this
Agreement; and
3) any fraudulent, unauthorized or wrongful act or
omission by Nationwide or its employees or agents.
b. General Agent agrees to indemnify and hold Nationwide harmless
from any and all losses, claims, damages, liabilities or
expenses to which Nationwide may become subject under any
statute, regulation, common law or otherwise, insofar as such
losses, claims, damages, liabilities or expenses related
directly to the sale of the Contracts and arise as a direct
consequence of:
1) any material misrepresentation or omission, or
alleged misrepresentation or omission involving the
sales contained within this Agreement provided that
such misrepresentations or omissions are not
attributable to any failure by Nationwide;
2) any failure by General Agent or its employees or
Agents, whether negligent or intentional, to perform
the duties and discharge the obligations contemplated
in this agreement; and
3) any fraudulent, unauthorized or wrongful act or
omission by General Agent or its employees or Agents.
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c. In the event that Nationwide is compelled or agrees to pay any
amount in the settlement of any claim, judgment, arbitration
or similar action and, in conjunction therewith, General Agent
voluntarily agrees to reimburse Nationwide, either partially
or totally, Nationwide may deduct the amount of the
reimbursement from any sales compensation subsequently payable
to General Agent. Nothing herein shall obligate General Agent
to provide any such voluntary reimbursement.
d. Neither Nationwide or General Agent shall be liable, as the
indemnifying party pursuant to Sections 13a and 13b, if the
losses, claims, damages, liabilities or legal expenses
incurred by the indemnified party arise out of the indemnified
party's willful misfeasance, bad faith, or gross negligence in
the performance of its duties, or through the reckless
disregard of the indemnified party's duties under this
Agreement.
e. Nationwide and General Agent will promptly notify each other
of the commencement of any litigation or proceedings, or the
assertion of any claim or any material inquiries related to
the duties set forth in the Agreement.
f. This indemnification shall be in addition to any other course
of action Nationwide or General Agent may have.
14. AGREEMENTS.
a. All advertising material and sales promotional material
published by General Agent or its Agents that specifically
name Nationwide or reference the Contracts shall be and remain
the sole and exclusive property of General Agent and shall be
used solely and exclusively by General Agent and its Agents.
Such material shall be submitted to Nationwide for its
approval prior to its use by General Agent or Agents.
Nationwide shall provide its approval in writing. Such
material shall not be used by Nationwide or its other agents
without prior written consent of General Agent.
b. Nationwide and General Agent shall keep thorough and correct
records, books, and accounts on all transactions arising out
of this Agreement, and shall preserve and hold all documents,
correspondence and records relating to Contracts which come
into its possession or under its control. All such books or
accounts, documents, correspondence and records of each party
pertaining to or used by it in connection with its operations
hereunder shall belong to it, and at all times shall be open
to inspection by any officer or duly authorized representative
of the other party.
c. In the course of normal customer servicing of existing
Contracts or if required by law, Nationwide may contact by
mail or otherwise any client, agent, account executive, or
employee of General Agent or other individual acting in a
similar capacity if deemed appropriate by Nationwide.
d. Each party agrees to promptly notify the others in writing of
any written customer complaint or notice of regulatory
investigation it receives which may involve the others.
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e. Each party represents and warrants that the entering into and
performance of this Agreement does not and will not conflict
with or cause a breach of any other agreement to which any of
them is a party.
f. Each party represents and warrants that it has full power and
authority to enter into this Agreement and to carry out its
duties and obligations hereunder.
g. Agency represents and warrants that it has the authority to
execute this Agreement on its own behalf and on behalf of any
of its affiliated agencies providing the services set forth in
this Agreement in order for General Agent to meet all
applicable legal requirements. All the necessary arrangements
are in place to bind Agency's affiliated agencies to the terms
and conditions of this Agreement.
15. TERMINATION.
a. Each party may terminate this Agreement for cause at any time,
without prior written notice, if another party (1) fails to
comply with the laws or regulations of any state or other
governmental agency or body having jurisdiction over the sale
of insurance or securities, (2) misappropriates any money or
property belonging to another party, (3) subjects an other
party to any actual or potential liability due to misfeasance,
malfeasance, or nonfeasance, (4) commits any fraud upon
another party, (5) has an assignment for the benefit of
creditors, (6) incurs bankruptcy, or (7) commits a material
breach of this Agreement.
b. Nationwide may terminate the relationship and any obligations
set forth herein if Xxxxxxx & Xxxx experiences a change of
control, if said change of control materially alters General
Agent's ability to perform its obligations under this
agreement.
c. This Agreement may be terminated by a party upon six months
written notice to the other parties.
16. MISCELLANEOUS PROVISIONS.
a. General Agent may assign or pledge any rights under this
Agreement with Nationwide's prior written consent.
b. The forbearance or neglect of Nationwide, Broker/Dealer or
Agency to insist upon strict compliance by a party, with any
of the provisions of this Agreement, whether continuing or
not, or to declare a forfeiture of termination against that
party, shall not be construed as a waiver of any of the rights
or privileges of the parties. No waiver of any right or
privilege of Nationwide, Broker/Dealer or Agency arising from
any default or failure of performance by a party shall affect
the rights or privileges of the other parties in the event of
a further default or failure of performance.
c. Communications sent pursuant to provisions of this item shall
be in writing and shall be delivered personally or sent by
U.S. mail or commercial courier:
If to Nationwide: Nationwide Life Insurance
Company and/ or
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Nationwide Life and Annuity
Insurance Company
Xxx Xxxxxxxxxx Xxxxx
Xxxxxxxx, XX 00000
Attn: Vice President,
Individual Annuity Operations
If to General Agent: Xxxxxxx & Xxxx, Inc.
Attn: Legal Department
0000 Xxxxx Xxxxxx
Xxxxxxxx Xxxx, XX 00000
Any party may change its address by so notifying the other parties in
writing. Any notice shall be deemed given only upon receipt by the
party to be notified.
d. Except as otherwise provided in this Agreement, this Agreement
may not be amended or modified except by a written Agreement
executed by the parties.
e. This Agreement (including Amendments and Compensation
Schedules) constitutes the entire agreement between the
parties and supersedes all prior agreements, understandings
and arrangements, oral and written, between the parties with
respect to the subject matter hereof.
f. This Agreement shall be binding upon the parties and their
respective successors and assigns.
g. This Agreement shall be governed and construed in accordance
with the laws of the State of Ohio.
h. In case any provision in this Agreement shall be invalid,
illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not be
affected or impaired.
i. The paragraph headings are for reference purposes only and
shall not be deemed to be a part of this Agreement or to
affect the meaning or interpretation of the Agreement.
j. This Agreement may be executed in any number of counterparts,
each of which shall be deemed to be an original instrument and
all of which together shall be deemed to be one and the same
instrument.
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IN WITNESS WHEREOF, the undersigned have executed this Agreement as of the date
first above written.
XXXXXXX & XXXX, INC. NATIONWIDE LIFE INSURANCE
COMPANY
on it's own behalf and on the behalf
of its affiliated Corporate Agencies NATIONWIDE LIFE AND ANNUITY
(General Agent) INSURANCE COMPANY
By: By:
----------------------------- -----------------------------
Title: Title:
-------------------------- --------------------------
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EXHIBIT A
COMPENSATION SCHEDULE
---------------------
Effective Date:
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This is the Compensation Schedule for the General Agent Agreement between
Nationwide and General Agent.
1. Nationwide shall pay General Agent compensation computed on the premiums
or purchase payments paid to, received and accepted by Nationwide on
contract applications procured by General Agent in accordance with this
Agreement, and at the rates set forth in this schedule and all amendments
attached hereto.
2. Unless otherwise provided in an applicable Net Compensation Addendum,
nothing herein shall be construed as giving General Agent the right to
withhold or net such compensation from premium or purchase payments it
shall receive.
3. Except as otherwise provided in this Agreement, Nationwide will prepare a
compensation statement for periods ending on the 7th, 15th, 22nd and the
last business day of each month and shall deliver the statement, and any
compensation due there under, to General Agent within 5 business days of
the end of such period for the following products: Xxxxxxx & Xxxx Advisors
Select Life, Xxxxxxx & Xxxx Advisors Survivorship Life, Xxxxxxx & Xxxx
Advisors Term One/Ten/Twenty and Xxxxxxx & Xxxx Advisors Term
Ten/Twenty-NY.
The billing cycle for compensation associated with the Xxxxxxx & Xxxx
Advisors Retirement Plan product, is the 1st day of the month through the
15th day and the 16th day through the last business day of the month.
The compensation cycle for the following products will be daily:
Xxxxxxx & Xxxx Advisor Select Annuity
Xxxxxxx & Xxxx Advisors Select Plus Annuity
Xxxxxxx & Xxxx Advisors Select Plus Annuity NY
4. The compensation rates which shall apply to business produced by General
Agent pursuant to this Agreement are attached to this Exhibit as one or
more Compensation Schedules, which may be amended from time to time as
provided for in this Agreement. The Compensation Schedules also apply to
all state specific versions of the contract form numbers listed on the
Compensation Schedules.
Some of the Contracts listed in the Compensation Schedules may not be
available for sale in all states. General Agent is responsible for
ascertaining whether it has the authority, pursuant to state and federal
law, to sell the Contracts in the jurisdictions in which the Contracts have
been approved and in which General Agent is appointed by Nationwide.
5. No compensation shall be payable, and Nationwide may chargeback any
compensation that may have been paid in any of the following situations:
(i) Nationwide, in its good faith discretion, determines not to issue the
Contract applied for; (ii) Nationwide refunds the premiums or purchase
payments upon the applicant's surrender or withdrawal pursuant to any
"free-look" privilege; (iii) Nationwide refunds the premiums paid as a
result of a complaint by the Contract holder or applicant; or (iv)
Nationwide determines that any person soliciting an application was
required to be licensed and was not or that any other person or entity
receiving compensation for soliciting application or premiums for the
Contracts is not or was not duly licensed as an insurance agent and
appointed (v) if Nationwide determines at any time that the applicant did
not meet applicable underwriting standards, including but not limited to,
the maximum issue age.
6. Compensations or replacements or conversions shall be allowed in accordance
with the Company rules in force at the time such replacement or conversion
is effected.
7. Nationwide will not pay compensation on an internal exchange unless otherwise
provided in this Agreement. THIS EXHIBIT ESTABLISHES THE COMPENSATION RATES FOR
PURCHASE PAYMENTS SPECIFIED HEREIN AND IN NO WAY SUPERSEDES OR REVOKES ANY OTHER
TERMS IN THE AGREEMENT. ALL OTHER PROVISIONS OF THE AGREEMENT ARE UNAFFECTED BY
THIS EXHIBIT.
14
COMPENSATION SCHEDULE
FOR
XXXXXXX & XXXX ADVISORS SELECT ANNUITY(SM)
Issued by Nationwide Life and Annuity Insurance Company
Xxxxxxx & Xxxx Advisors Select Annuity(SM) FHL 661 or FHL 686
(includes non-qualified, XXX, SEP XXX, SIMPLE XXX,
Spousal XXX, Xxxx XXX, 401(a) investment only, CRT,
ORP, and non-ERISA 403(b))
NEW MONEY SCHEDULE UPFRONT OPTION/NO TRAIL OPTION #1 TRAIL OPTION #2 TRAIL OPTION #3 TRAIL OPTION #4
TRAIL *
Annuitant Age Compensation Rate Compensation Rate Compensation Rate Compensation Rate Compensation Rate
0 - 80 7.75% 6.25% 5.75% 4.50% 2.95%
81 - 85 3.90% 3.10% 2.90% 2.25% 1.50%
86 - 90 3.10% 2.50% 2.30% 1.80% 1.20%
Compensation
Beginning 5th
Calendar Quarter: 0.00% 0.25% 0.32% 0.50% 0.75%
* NOTE: UNLESS OTHERWISE ELECTED BY THE AGENT OF GENERAL AGENT, UPFRONT
OPTION WILL BE THE AUTOMATIC COMPENSATION OPTION.
Trail compensation is computed at the end of each calendar quarter beginning
with the quarter specified above. Trail compensation is computed by multiplying
assets times trail percentage divided by 4.
ADDITIONAL CHARGEBACK PROVISIONS for the Xxxxxxx & Xxxx Advisors Select
Annuity(SM) Contracts:
In the event that any Contract issued under this Agreement experiences a
withdrawal, compensation paid on amounts which are subject to Contingent
Deferred Sales Charges will be charged back to the General Agent within the
first 6 months from the date of issue, the full compensation paid thereon shall
be charged back.
INTERNAL EXCHANGES to the Xxxxxxx & Xxxx Advisors Select Annuity(SM)
Contracts:
1) INTERNAL EXCHANGES FROM ANY NATIONWIDE LIFE INSURANCE COMPANY AND
NATIONWIDE LIFE AND ANNUITY INSURANCE COMPANY FIXED AND VARIABLE ANNUITY
CONTRACTS EXCEPT CONTRACTS SPECIFIED BELOW:
INTERNAL EXCHANGE SCHEDULE * UPFRONT OPTION/NO TRAIL OPTION #1 TRAIL OPTION #2 TRAIL OPTION #3 **
TRAIL
Annuitant Age Compensation Rate Compensation Rate Compensation Rate Compensation Rate
0 - 80 3.90% 2.40% 1.90% 0.65%
81 - 85 1.95% 1.20% 0.95% 0.30%
86 - 90 1.55% 0.95% 0.75% 0.25%
Quarterly Trail Compensation
Beginning 5th
Calendar Quarter: 0.00% 0.25% 0.32% 0.50%
* NOTE: FOR SUBSEQUENT PAYMENTS RECEIVED INTO THE EXCHANGED POLICY,
COMPENSATION WILL BE PAID USING THE NEW MONEY GRID LISTED
ABOVE.
** NOTE: UNLESS OTHERWISE ELECTED BY THE AGENT OF GENERAL AGENT, TRAIL
OPTION #3 WILL BE THE AUTOMATIC COMPENSATION OPTION.
Trail compensation is computed at the end of each calendar quarter
beginning with the quarter specified above. Trail compensation is
computed by multiplying assets times trail percentage divided by 4.
15
2) INTERNAL EXCHANGES FROM ANY XXXXXXX & XXXX ADVISORS VARIABLE ANNUITY: Full
CDSC will be assessed, (or if the contract is outside of the CDSC period)
no chargebacks will be applied on any previous compensation paid on the
original Contract and no compensation paid on the Internal Exchange.
3) INTERNAL EXCHANGES FROM ANY FIDELITY ADVISOR PRODUCT CONTRACT: Full CDSC
will be assessed (or if the contract is outside of the CDSC period), no
chargebacks will be applied on any previous compensation paid on the
original Contract and no compensation paid on the Internal Exchange.
4) INTERNAL EXCHANGES FROM THE BEST OF AMERICA(R) GROUP PENSIONS SERIES
CONTRACT: If the Upfront Compensation Option is elected, the compensation
shall be reduced in the amount equal to the amount of the Contingent
Deferred Sales Charge waived by Nationwide on The Best of America(R) Group
Pensions Series contract ("Waived CDSC Amount"). The Trail Compensation
Options (#1, 2, 3 and 4) may only be elected when the Total Payout Rate
("Upfront Compensation") is equal to or greater than the Waived CDSC
Amount. Where the Trail Compensation Options can be elected, the amount of
the Upfront Compensation shall be reduced by the Waived CDSC Amount.
Standard compensation rates shall apply to internal exchanges from the Best
of America(R) Group Pension Series contracts.
16
COMPENSATION SCHEDULE
FOR
XXXXXXX & XXXX ADVISORS SELECT PLUS ANNUITY(SM)
Issued by Nationwide Life and Annuity Insurance Company
Xxxxxxx & Xxxx Advisors Select Plus Annuity(SM) FHL 677 or FHL 688
(includes non-qualified, XXX, SEP XXX, SIMPLE XXX,
Spousal XXX, Xxxx XXX, 401(a) investment only, CRT,
ORP, and non-ERISA 403(b))
UPFRONT OPTION/NO TRAIL * TRAIL OPTION #1
Annuitant Age Compensation Rate Compensation Rate
0 - 80 5.55% 3.80%
81 - 85 2.80% 1.90%
86 - 90 2.20% 1.50%
Quarterly Trail Compensation
Beginning 5th Calendar
Quarter: 0.00% 0.25%
* NOTE: UNLESS OTHERWISE ELECTED BY THE AGENT OF GENERAL AGENT,
UPFRONT OPTION WILL BE THE AUTOMATIC COMPENSATION OPTION
FOR BUSINESS WITH NEW MONEY.
Trail compensation is computed at the end of each calendar quarter beginning
with the quarter specified above. Trail compensation is computed by multiplying
assets times trail percentage divided by 4.
ADDITIONAL CHARGEBACK PROVISIONS for the Xxxxxxx & Xxxx Advisors Select Plus
Annuity(SM) Contracts:
In the event that any Contract issued under this Agreement experiences a
withdrawal, compensation paid on amounts which are subject to Contingent
Deferred Sales Charges will be charged back to the General Agent within the
first 6 months from the date of issue, the full compensation paid thereon shall
be charged back.
INTERNAL EXCHANGES to the Xxxxxxx & Xxxx Advisors Select Plus Annuity(SM)
Contracts:
1) INTERNAL EXCHANGES FROM ANY NATIONWIDE LIFE INSURANCE COMPANY AND
NATIONWIDE LIFE AND ANNUITY INSURANCE COMPANY FIXED OR VARIABLE ANNUITY
CONTRACTS EXCEPT CONTRACTS SPECIFIED BELOW:: Full CDSC will be assessed,
(or if the contract is outside of the CDSC period) no chargebacks will be
applied on any previous compensation paid on the original Contract and no
compensation paid on the Internal Exchange.
2) INTERNAL EXCHANGES FROM ANY XXXXXXX & XXXX ADVISORS VARIABLE ANNUITY: Full
CDSC will be assessed, (or if the contract is outside of the CDSC period)
no chargebacks will be applied on any previous compensation paid on the
original Contract and no compensation paid on the Internal Exchange.
3) INTERNAL EXCHANGES FROM ANY FIDELITY ADVISOR PRODUCT CONTRACT: Full CDSC
will be assessed, (or if the contract is outside of the CDSC period) no
chargebacks will be applied on any previous compensation paid on the
original Contract and no compensation paid on the Internal Exchange.
4) INTERNAL EXCHANGES FROM THE BEST OF AMERICA(R) GROUP PENSIONS SERIES
CONTRACT: If the Upfront Compensation Option is elected, the compensation
shall be reduced in the amount equal to the amount of the Contingent
Deferred Sales Charge waived by Nationwide on The Best of America(R) Group
Pensions Series contract ("Waived CDSC Amount"). The Trail Compensation
Options #1 may only be elected when the Total Payout Rate ("Upfront
Compensation") is equal to or greater than the Waived CDSC Amount. Where
the Trail Compensation Options can be elected, the amount of the Upfront
Compensation shall be reduced by the Waived CDSC Amount. Standard
compensation rates shall apply to internal exchanges from the Best of
America(R) Group Pension Series.
17
COMPENSATION SCHEDULE
FOR
XXXXXXX & XXXX ADVISORS SELECT PLUS ANNUITY - NY(SM)
Issued by Nationwide Life Insurance Company
Xxxxxxx & Xxxx Advisors Select Plus Annuity - NY(SM) APO 4502-32A
(includes non-qualified, XXX, SEP XXX, SIMPLE XXX,
Spousal XXX, Xxxx XXX, 401(a) investment only, CRT,
ORP, and non-ERISA 403(b))
The following options will apply in New York ONLY.
NEW MONEY SCHEDULE UPFRONT OPTION/NO TRAIL UPFRONT OPTION/NO TRAIL
OPTION #1* OPTION #2
Annuitant Age Compensation Rate Compensation Rate
0 - 75 5.52% 4.02%
76 - 80 4.70% 3.40%
81 - 85 2.75% 2.00%
* NOTE: UNLESS OTHERWISE ELECTED BY THE AGENT OF GENERAL AGENT,
UPFRONT OPTION #1 WILL BE THE AUTOMATIC COMPENSATION OPTION
FOR BUSINESS WITH NEW MONEY.
ADDITIONAL CHARGEBACK PROVISIONS for the Xxxxxxx & Xxxx Advisors Select Plus
Annuity - NY(SM) Contracts:
In the event that any Contract issued under this Agreement experiences a
withdrawal, compensation paid on amounts which are subject to Contingent
Deferred Sales Charges will be charged back to the General Agent within the
first 12 months from the date of issue, the full compensation paid thereon shall
be charged back.
INTERNAL EXCHANGES to the Xxxxxxx & Xxxx Advisors Select Annuity(SM)
Contracts:
1) INTERNAL EXCHANGES FROM ANY NATIONWIDE LIFE INSURANCE COMPANY AND
NATIONWIDE LIFE AND ANNUITY INSURANCE COMPANY FIXED AND VARIABLE ANNUITY
CONTRACTS EXCEPT CONTRACTS SPECIFIED BELOW:
The following options will apply in New York ONLY.
INTERNAL EXCHANGE SCHEDULE UPFRONT OPTION/NO TRAIL UPFRONT OPTION/NO TRAIL
OPTION #1 OPTION #2 *
Annuitant Age Compensation Rate Compensation Rate
0 - 75 2.75% 2.00%
76 - 80 2.25% 1.70%
81 - 85 1.40% 1.00%
* NOTE: FOR SUBSEQUENT PAYMENTS RECEIVED INTO THE EXCHANGED POLICY,
COMPENSATION WILL BE PAID USING THE NEW MONEY GRID LISTED
ABOVE.
** NOTE: UNLESS OTHERWISE ELECTED BY THE AGENT OF GENERAL AGENT,
UPFRONT OPTION #2 WILL BE THE AUTOMATIC COMPENSATION OPTION
FOR INTERNAL EXCHANGES.
2) INTERNAL EXCHANGES FROM ANY XXXXXXX & XXXX ADVISORS VARIABLE ANNUITY: Full
CDSC will be assessed, (or if the contract is outside of the CDSC period)
no chargebacks will be applied on any previous compensation paid on the
original Contract and no compensation paid on the Internal Exchange.
3) INTERNAL EXCHANGES FROM ANY FIDELITY ADVISOR PRODUCT CONTRACT: Full CDSC
will be assessed, (or if the contract is outside of the CDSC period) no
chargebacks will be applied on any previous compensation paid on the
original Contract and no compensation paid on the Internal Exchange.
4) INTERNAL EXCHANGES FROM THE BEST OF AMERICA(R) GROUP PENSIONS SERIES
CONTRACT: If the Upfront Compensation Option is elected, the compensation
shall be reduced in the amount equal to the amount of the Contingent
Deferred Sales Charge waived by Nationwide on The Best of America(R) Group
Pensions Series contract ("Waived CDSC Amount"). Standard compensation
rates shall apply to internal exchanges from The Best of America(R) Group
Pension Series.
18
COMPENSATION SCHEDULE
FOR
FLEXIBLE PREMIUM VARIABLE UNIVERSAL LIFE
XXXXXXX & XXXX ADVISORS SELECT LIFE
Issued by Nationwide Life Insurance Company
FOR POLICIES ISSUED UNDER CONTRACT FORM VLO 510:
CONTRACTS CONTRACT NUMBER
-----------------------------------------------------------------------------------------------------------------------------
Xxxxxxx and Xxxx
Flexible Premium Variable Universal Life VLO 510
Advisors Select Life
-----------------------------------------------------------------------------------------------------------------------------
PREMIUM BASED COMPENSATION
For all ages and all underwriting classes:
Year 1: Compensation is 60% of premium up to compensation target premium plus 5%
of any premium over compensation target premium.
Years 2 - 10 Compensation is 3 % of premium received in that year.
Years 11 + Compensation is 2 % of premium received in that year.
-----------------------------------------------------------------------------------------------------------------------------
Compensation is based on the relationship between premiums (received and
accepted) and the target premium of the policy in question. Target Premiums vary
by type of product, type of rider, insured's issue age, sex, specified amount
and the underwriting risk classification.
COMPENSATION ON INCREASES IN COVERAGE: Compensation for an increase in coverage
will be paid at the rate of 60% of the lessor of 1) the amount of premiums paid
in the 12 months following an increase, and 2) target premium following the
increase less the previous target premium. Compensation on premiums in excess of
the target premium following the increase less the previous target premium will
be 5% of such premiums. No EAP is paid for increases in coverage.
EXPENSE ALLOWANCE PAYMENT: All Expense Allowance Payments (EAP) will be paid as
earned and are separate from and in addition to the compensation rates stated
above.
For each FLEXIBLE PREMIUM VARIABLE UNIVERSAL LIFE policy issued (excluding any
policies issued as internal replacements), Nationwide will pay to the General
Agent expense reimbursements calculated as the product of : 1) EAP percentage;
and 2) the lessor of : a) actual first year premiums paid up to the Target
Premium, b) 75% of the corresponding Guideline Annual Premium, or c) planned
renewal premium requested by the owner in the application for insurance; where,
EAP Percentage = 15%
Nothing in this Agreement shall be construed as giving the General Agent the
right to withhold or deduct an Expense Allowance Payment from premium it shall
receive.
The General Agent agrees that no payment will be used by the agent or General
Agent to effect compensation in excess of the limits of Section 4228 of the New
York Insurance Laws. In the event overpayment is made to the General Agent by
Nationwide, because life compensation payments together with expense allowance
payments exceed applicable limits of Section 4228 of the New York Insurance Law,
such overpayment shall be charged against and deducted from future compensation
due to the General Agent by Nationwide until paid in full. Nationwide will not
knowingly permit to be paid, by any payor, payments in excess of this Plan.
EAP CHARGEBACKS: In the event a variable life insurance policy shall terminate
within twelve months from the date of issue, 100% of the EAP shall be charged
back against the General Agent.
CHARGEBACKS: In the event a variable life insurance policy shall terminate
within six months from the date of issue, the full compensation paid thereon
shall be charged back against the General Agent. In the event a termination
takes place after the sixth and before the thirteenth month after the date of
issue, fifty percent of the compensation will be charged back against the
General Agent.
19
CHARGEBACK ON FIRST YEAR LOANS: Loans taken in the first year will result in a
partial charge back of commission and EAP. Loans are considered a reduction of
premiums in excess of commission target premium, and secondly a reduction of
premiums paid up to target.
The charge back of the commissions earned on premiums paid in excess of target
is calculated as:
Zero, if premiums paid have not exceeded target;
or A times B times C divided by D, if premiums paid have exceeded the
commission target premium. Where:
A equals the lesser of the amount of the loan and the premiums paid
in excess of target.
B equals 100% for loans taken in months 1 through 6 and 50% for
loans taken in months 7 through 12,
C equals the amount of commission paid on premiums received in
excess of target, and
D equals the premiums paid in excess of target.
The charge back of the commissions earned on premiums paid up to excess of
target is calculated as:
A times B times C divided by D, where:
A equals the greater of 0 (zero), and the lesser of amount of the
loan and the amount of the loan plus the target premium less the
premiums paid,
B equals 100% for loans taken in the months 1 through 6 and 50% for
loans taken in months 7 through 12,
C equals the amount of commission paid on premiums up to target,
and
D equals the lesser of the premiums paid and the commission target
premium.
The charge back of the EAP is calculated as:
A times B times C divided by D, where:
A equals the greater of 0 (zero), and the lesser of amount of the
loan and the amount of loan plus the target premium less the
premiums paid,
B equals 100%
C equals the amount of EAP earned, and
D equals the lesser of the premiums paid and the commission target
premium.
In the event that a loan taken in the first year on which the above chargeback
provision applies is repaid within the first policy year, the amount of the
chargeback attributed to the amount of the loan repayment will be paid as
compensation. Loan repayments will first be considered repayment of target
premiums, and secondly repayment of premiums in excess of target.
THE CHARGE BACK OF INCREASE COMMISSION DUE TO LOANS OR WITHDRAWALS TAKEN WITHIN
ONE YEAR OF INCREASE:
The charge back of the commissions earned on increases is calculated as:
The charge back of the commissions earned on premiums paid in excess of new
target less the previous target is calculated as:
Zero, if premiums paid have not exceeded new target less the
previous target;
or A times B times C divided by D, if premiums paid have exceeded the
new target less the previous target. Where:
A equals the lesser of the amount of the loan and/or withdrawal and
the premiums paid in excess of new target less the previous target.
B equals 100% for loans and/or withdrawals taken in months 1
through 6 following the increase and 50% for loans taken in months
7 through 12 following the increase,
C equals the amount of commission paid on premiums received in
excess of target, and
D equals the premiums paid in excess of target
20
The charge back of the commissions earned on premiums paid up to the new target
less the previous target is calculated as:
Zero, if no premiums have been paid within 12 months following the
increase.
A times B times C divided by D, where:
A equals the greater of 0 (zero) and the lesser (1) and (2), where
(1) equals new target less the prior target, and
(2) equals the amount of the loan or withdrawal,
B equals 100% for loans or withdrawals taken in the months 1
through 6 following the increase and 50% for loans or withdrawals
taken months 7 through 12 following the increase,
C equals the amount of commission paid on premiums received up to
the new target less the previous target, and
D equals the lesser of the premiums paid within 12 months following
the increase and the new target less the prior target premium.
21
COMPENSATION SCHEDULE
FOR
LAST SURVIVOR
FLEXIBLE PREMIUM VARIABLE UNIVERSAL LIFE
XXXXXXX & XXXX ADVISORS SURVIVORSHIP LIFE
Issued by Nationwide Life Insurance Company
FOR POLICIES ISSUED UNDER CONTRACT FORM VLO 600:
=============================================================================================================================
CONTRACTS CONTRACT NUMBER
-----------------------------------------------------------------------------------------------------------------------------
Xxxxxxx and Xxxx
Last Survivor Flexible Premium Variable Universal Life VLO 600
Advisors Survivorship Life
-----------------------------------------------------------------------------------------------------------------------------
PREMIUM BASED COMPENSATION
For all ages and all underwriting classes:
Year 1: Compensation is 60% of premium up to compensation target premium plus
5% of any premium over compensation target premium.
Years 2 - 10 Compensation is 3 % of premium received in that year.
Years 11 + Compensation is 2 % of premium received in that year.
-----------------------------------------------------------------------------------------------------------------------------
Compensation is based on the relationship between premiums (received and
accepted) and the target premium of the policy in question. Target Premiums vary
by type of product, type of rider, insured's issue age, sex, specified amount
and the underwriting risk classification.
COMPENSATION ON INCREASES IN COVERAGE: Compensation for an increase in coverage
will be paid at the rate of 60% of the lessor of 1) the amount of premiums paid
in the 12 months following an increase, and 2) target premium following the
increase less the previous target premium. Compensation on premiums in excess of
the target premium following the increase less the previous target premium will
be 5% of such premiums. No EAP is paid for increases in coverage
EXPENSE ALLOWANCE PAYMENT: All Expense Allowance Payments (EAP) will be paid as
earned and are separate from and in addition to the compensation rates stated
above.
For each LAST SURVIVOR FLEXIBLE PREMIUM VARIABLE UNIVERSAL LIFE policy issued
(excluding any policies issued as internal replacements), Nationwide will pay to
the General Agent expense reimbursements calculated as the product of : 1) EAP
percentage; and 2) the lessor of : a) actual first year premiums paid up to the
Target Premium, b) 75% of the corresponding Guideline Annual Premium, or c)
planned renewal premium requested by the owner in the application for insurance;
where,
EAP Percentage = 15%
Nothing in this Agreement shall be construed as giving the General Agent the
right to withhold or deduct an Expense Allowance Payment from premium it shall
receive.
The General Agent agrees that no payment will be used by the agent or General
Agent to effect compensation in excess of the limits of Section 4228 of the New
York Insurance Laws. In the event overpayment is made to the General Agent by
Nationwide, because life compensation payments together with expense allowance
payments exceed applicable limits of Section 4228 of the New York Insurance Law,
such overpayment shall be charged against and deducted from future compensation
due to the General Agent by Nationwide until paid in full. Nationwide will not
knowingly permit to be paid, by any payor, payments in excess of this Plan.
EAP CHARGEBACKS: In the event a variable life insurance policy shall terminate
within twelve months from the date of issue, 100% of the EAP shall be charged
back against the General Agent.
CHARGEBACKS: In the event a variable life insurance policy shall terminate
within six months from the date of issue, the full compensation paid thereon
shall be charged back against the General Agent. In
22
the event a termination takes place after the sixth and before the thirteenth
month after the date of issue, fifty percent of the compensation will be charged
back against the General Agent.
CHARGEBACK ON FIRST YEAR LOANS: Loans taken in the first year will result in a
partial charge back of commission and EAP. Loans are considered a reduction of
premiums in excess of commission target premium, and secondly a reduction of
premiums paid up to target.
The charge back of the commissions earned on premiums paid in excess of target
is calculated as:
Zero, if premiums paid have not exceeded target;
or A times B times C divided by D, if premiums paid have exceeded the
commission target premium. Where:
A equals the lesser of the amount of the loan and the premiums paid
in excess of target.
B equals 100% for loans taken in months 1 through 6 and 50% for
loans taken in months 7 through 12,
C equals the amount of commission paid on premiums received in
excess of target, and
D equals the premiums paid in excess of target.
The charge back of the commissions earned on premiums paid up to excess of
target is calculated as:
A times B times C divided by D, where:
A equals the greater of 0 (zero), and the lesser of amount of the
loan and the amount of the loan plus the target premium less the
premiums paid,
B equals 100% for loans taken in the months 1 through 6 and 50% for
loans taken in months 7 through 12,
C equals the amount of commission paid on premiums up to target,
and
D equals the lesser of the premiums paid and the commission target
premium.
The charge back of the EAP is calculated as:
A times B times C divided by D, where:
A equals the greater of 0 (zero), and the lesser of amount of the
loan and the amount of loan plus the target premium less the
premiums paid,
B equals 100%
C equals the amount of EAP earned, and
D equals the lesser of the premiums paid and the commission target
premium.
In the event that a loan taken in the first year on which the above chargeback
provision applies is repaid within the first policy year, the amount of the
chargeback attributed to the amount of the loan repayment will be paid as
compensation. Loan repayments will first be considered repayment of target
premiums, and secondly repayment of premiums in excess of target.
THE CHARGE BACK OF INCREASE COMMISSION DUE TO LOANS OR WITHDRAWALS TAKEN WITHIN
ONE YEAR OF INCREASE:
The charge back of the commissions earned on premiums paid in excess of new
target less the previous target is calculated as:
Zero, if premiums paid have not exceeded new target less the previous
target;
or A times B times C divided by D, if premiums paid have exceeded the
new target less the previous target. Where:
A equals the lesser of the amount of the loan and/or withdrawal and
the premiums paid in excess of new target less the previous target.
B equals 100% for loans and/or withdrawals taken in months 1
through 6 following the increase and 50% for loans taken in months
7 through 12 following the increase,
C equals the amount of commission paid on premiums received in
excess of target, and
D equals the premiums paid in excess of target
23
The charge back of the commissions earned on premiums paid up to the new target
less the previous target is calculated as:
Zero, if no premiums have been paid within 12 months following the
increase.
A times B times C divided by D, where:
A equals the greater of 0 (zero) and the lesser (1) and (2),
where
(1) equals new target less the prior target, and
(2) equals the amount of the loan or withdrawal,
B equals 100% for loans or withdrawals taken in the months 1
through 6 following the increase and 50% for loans or withdrawals
taken months 7 through 12 following the increase,
C equals the amount of commission paid on premiums received up to
the new target less the previous target, and
D equals the lesser of the premiums paid within 12 months following
the increase and the new target less the prior target premium.
In the event that a loan taken within one year of increase on which the above
chargeback provision applies is repaid within one year of the increase policy
year, the amount of the chargeback attributed to the amount of the loan
repayment will be paid as compensation. Loan repayments will first be considered
repayment of the increase in target premium, and secondly repayment of premiums
in excess of the new target.
CHARGEBACK ON REDUCTIONS DURING THE FIRST FOUR YEARS; OR WITHIN THE FIRST 48
MONTHS FOLLOWING AN INCREASE IN COVERAGE: Reductions in the specified amount
during the first four years or within 48 months following an increase will
result in a chargeback of commission and EAP.
The chargeback of the commission and EAP earned on premiums paid in the first
policy year is calculated as:
For reductions in year 1: 100% of the first year commission and EAP
paid on the amount of the reduction (if applicable - the contract does
not allow first year reductions)
For reductions in year 2: 75% of the first year commission and EAP paid
on the amount of the reduction.
For reductions in year 3: 50% of the first year commission and EAP paid
on the amount of the reduction.
For reductions in year 4: 25% of the first year commission and EAP paid
on the amount of the reduction.
For reductions in year 5 or later, no chargeback will apply.
All chargeback rules previously stated will apply.
24
COMPENSATION SCHEDULE
FOR
XXXXXXX & XXXX ADVISORS TERM ONE/TEN/TWENTY (SM)
XXXXXXX & XXXX ADVISORS TERM TEN/TWENTY - NY(SM)
Issued by Nationwide Life Insurance Company
Effective Date: January 10, 2000
----------------
This is an amendment to the Exhibit A, Compensation Schedule, of the General
Agent Agreement, between Nationwide Life Insurance Company and the General
Agent.
THEREFORE, Exhibit A, Compensation Schedule, is amended as follows:
============================================================================================================================
CONTRACTS CONTRACT NUMBER
----------------------------------------------------------------------------------------------------------------------------
Xxxxxxx & Xxxx Advisors Term One/Ten/Twenty(SM)
VLO 428
----------------------------------------------------------------------------------------------------------------------------
COMPENSATION
For all ages and all underwriting classes:
----------------------------------------------------------------------------------------------------------------------------
Year 1: Compensation is 60% of premium less policy fee.
----------------------------------------------------------------------------------------------------------------------------
Years 2 + Compensation is 3% of premium received in that year less
policy fee.
----------------------------------------------------------------------------------------------------------------------------
EXPENSE ALLOWANCE PAYMENT: All Expense Allowance Payments (EAP) will be paid as
earned and are separate from and in addition to the compensation rates stated
above.
For each PRO-TERM SERIES policy issued (excluding any policies issued as
internal replacements), Nationwide will pay to the General Agent expense
reimbursements based on first year paid premiums calculated as the product of :
1) EAP Percentage and 2) Premiums less policy Fee; where,
EAP Percentage = 20.00%
Nothing in this Agreement shall be construed as giving the General Agent the
right to withhold or deduct an Expense Allowance Payment from premium it shall
receive.
The General Agent agrees that no payment will be used by the agent or General
Agent to effect compensation in excess of the limits of Section 4228 of the New
York Insurance Laws. In the event overpayment is made to the General Agent by
Nationwide, because life compensation payments together with expense allowance
payments exceed applicable limits of Section 4228 of the New York Insurance Law,
such overpayment shall be charged against and deducted from future compensation
due to the General Agent by Nationwide until paid in full. Nationwide will not
knowingly permit to be paid, by any payor, payments in excess of this Plan.
EAP CHARGEBACKS: In the event a Xxxxxxx & Xxxx Advisors Term One/Ten/Twenty(SM)
life insurance policy shall terminate within twelve months from the date of
issue, 100% of the EAP shall be charged back against the General Agent. In the
event a termination takes place after the twelfth month and before the
twenty-fifth month after the date of issue, fifty percent of the EAP shall be
charged back against the General Agent.
CHARGEBACKS: In the event a Xxxxxxx & Xxxx Advisors Term One/Ten/Twenty(SM) life
insurance policy shall terminate within twelve months from the date of issue,
the full compensation paid thereon shall be charged back against the General
Agent. In the event a termination takes place after the twelfth and before the
twenty-fifth month after the date of issue, fifty percent of the first year
compensation will be charged back against the General Agent. Charge backs may be
applied against current and future compensation payable.
UNEARNED PREMIUM CHARGEBACKS: In the event a Xxxxxxx & Xxxx Advisors Term
One/Ten/Twenty(SM) contract terminates after the twelfth month after the date of
issue, 100% of the compensation paid on Unearned Premium will be charged back
against the General Agent. Unearned
25
Premium is premium paid which is not yet due. Unearned Premiums are returned to
the policyholder upon life insurance policy termination.
This amendment also applies to state-specific versions of these contract form
numbers.
All other provisions of the existing General Agent Agreement, as amended remain
in effect.
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EXHIBIT B
EXCLUSIVITY
Nationwide will be the exclusive provider to Xxxxxxx & Xxxx for the following
products:
1. Xxxxxxx & Xxxx Advisor Select Annuity
2. Xxxxxxx & Xxxx Advisors Select Plus Annuity
3. Xxxxxxx & Xxxx Advisors Select Plus Annuity NY
4. Xxxxxxx & Xxxx Advisors Select Life
5. Xxxxxxx & Xxxx Advisors Retirement Plan
There will be no Exclusivity Arrangement regarding the following products:
1. Xxxxxxx & Xxxx Advisors Survivorship Life
2. Xxxxxxx & Xxxx Advisors Term Ten/Twenty
3. Xxxxxxx & Xxxx Advisors Term Ten/Twenty NY
Upon the mutual agreement of both parties, this EXHIBIT may be amended from time
to time with the addition of certain other annuity or insurance products.
*Actual form numbers to be used in certain states may have different identifying
suffixes, which reflect certain unique characteristics of the contract mandated
by the particular state insurance authority.
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ADDENDUM TO THE
GENERAL AGENT AGREEMENT
SINGLE COMPENSATION PAYMENT
Effective date _____________________
This is an addendum to the General Agent Agreement among Nationwide Life
Insurance Company, Nationwide Life and Annuity Insurance Company and Xxxxxxx &
Xxxx, Inc., on its own behalf and on behalf of its affiliated Corporate
Insurance Agencies (Collectively referred to as "Agency") and ("Broker/Dealer").
Nationwide will send a single compensation payment to General Agent in a
mutually acceptable manner. Such compensation payment shall be net of
chargebacks and any other charges owed by General Agent. Nationwide will provide
General Agent with Compensation Statements providing descriptions of the
compensation earned by agent. General Agent represents and warrants that it has
all necessary contractual arrangements in place to receive such payment on
behalf of the individual entities and agents, that it will forward all
commissions to the properly licensed and appointed insurance agencies and/or
agents, and that it will comply with applicable law in its handling of such
commissions.
Notwithstanding any other provisions to this General Agent Agreement, Nationwide
shall not be obligated to pay any compensation which would be in violation of
applicable laws, rules or regulations of any jurisdiction.
Nationwide reserves the right to terminate this arrangement at its discretion
with proper notice to all parties. All of the other provisions of the existing
General Agent Agreement, as amended, shall remain in effect.
XXXXXXX & XXXX, INC. NATIONWIDE LIFE INSURANCE
(General Agent) COMPANY
on it's own behalf and on the
behalf of its affiliated Corporate NATIONWIDE LIFE AND ANNUITY
Agencies INSURANCE COMPANY
By: By:
------------------------------- -----------------------------
Title: Title: Vice President
------------------------------
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APPOINTMENT BACKGROUND INVESTIGATION ADDENDUM TO
GENERAL AGENT AGREEMENT
Effective Date _______________
This Appointment Background Investigation Addendum is incorporated into the
General Agent's Agreement in effect among Nationwide Life Insurance Company and
Nationwide Life and Annuity Insurance Company, and XXXXXXX & XXXX, INC. on its
own behalf and on behalf of its affiliated Corporate Insurance Agencies
(Collectively referred to as "Agency") and ("Broker/Dealer") collectively
referred to as "General Agent".
General Agent will conduct a thorough background investigation on each of its
Registered Representatives. In addition to the information obtained by your
branch managers during the interview process, the following reviews are
conducted by your Home Office staff as part of the registration, licensing and
appointment process:
1. PREHIRES: A check of the Central Registration Depository is completed
for any individual who has been previously employed in the securities
industry. The information obtained includes employment, residential
exam and disclosure history, fingerprint/arrest information and
registration status.
2. FINGERPRINTING: A fingerprint card is submitted to the NASD for all
employees and independent contractors. A review of arrest records both
disclosed by the applicant or reported by the NASD is required for
bonding consideration.
3. COURT CHECK: Outside reporting agencies are used to conduct court
record searches. Situations identified by this process are reviewed and
documented to determine any judgments, liens and/or bankruptcies.
Any adverse information is reviewed with appropriate management personnel within
the firm and additional inquiries are made where appropriate.
Nationwide has reviewed General Agent's current employment screening process and
deems that these guidelines meet Nationwide's screening standard.
General Agent agrees to:
1. promptly provide Nationwide detailed background information on any
agent appointed or persons nominated for appointment when necessary to
comply with state insurance regulations or when investigating a
consumer or government entity complaint, audit, market conduct exam or
other inquiries; and,
2. notify Nationwide in advance of any changes in their background
requirements.
3. immediately notify Nationwide in writing of any material changes which
affect the qualifications of an agent or agency for appointment and/or
licenses under applicable state law.
General Agent represents and warrants that the agents for whom it requests
appointment or license sponsorship from Nationwide meets the applicable state
licensing and appointment requirements.
Nationwide reserves the right to modify their appointment and background
investigation standards and practices at any time and will notify General Agent
prior to implementation.
XXXXXXX & XXXX, INC. NATIONWIDE LIFE INSURANCE
COMPANY
ON IT'S OWN BEHALF AND ON THE
BEHALF OF ITS AFFILIATED CORPORATE NATIONWIDE LIFE AND ANNUITY
AGENCIES INSURANCE COMPANY
By: By:
----------------------------- ----------------------------------
Print Name: Print Name:
--------------------- --------------------------
Title: Title:
-------------------------- -------------------------------
Date: Date:
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