EXHIBIT (3)(A)
DISTRIBUTION AGREEMENT
This Agreement ("Agreement") is made as of April 28, 2000 by and among PACIFIC
LIFE & ANNUITY COMPANY ("PL&A"), on its own behalf and on behalf of the
segregated asset accounts of PL&A listed on Exhibit A to this Agreement (the
"Separate Accounts"), and PACIFIC SELECT DISTRIBUTORS, INC., ("Distributor"), a
broker/dealer registered with the Securities and Exchange Commission ("SEC")
pursuant to the Securities Exchange Act of 1934, as amended ("Exchange Act"),
and a member of the National Association of Securities Dealers, Inc. ("NASD").
WHEREAS, PL&A has established and maintains the Separate Accounts, a separate
investment account, for the purpose of selling variable life contracts
("Contracts") to commence after the effectiveness of the Registration Statement
relating thereto filed with the Securities and Exchange Commission on form S-6,
or any successor form thereto, pursuant to the Securities Act of 1933, as
amended ("1933 Act"), through Distributor, acting as general agent of PL&A;
WHEREAS, the Separate Accounts are registered as a unit investment trust under
the Investment Company Act of 1940 ("1940 Act");
WHEREAS, PL&A desires to retain Pacific Select Distributors as the Distributor
and Principal Underwriter to provide for the sale and distribution to the public
of the Contracts issued by PL&A and funded by interests in the General Account
of PL&A and in the Separate Accounts and Distributor is willing to render such
services;
NOW THEREFORE, in consideration of the mutual promises and covenants hereinafter
set forth, the parties agree as follows:
1. Principal Underwriter. PL&A hereby appoints Distributor, during the term of
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this Agreement, subject to the registration requirements of the 1933 Act and
the 1940 Act and the provisions of the Securities Exchange Act, to be the
Distributor and Principal Underwriter for the sale of Contracts to the
public in each state and other jurisdictions in which the Contracts may be
lawfully sold. PL&A also appoints Distributor as its independent General
Agent for sale of its Contracts (including any riders which PL&A may make
available in connection therewith or any contracts for which the Contracts
may be exchanged or converted) and for sale of such other insurance
contracts or annuity contracts as PL&A may, from time to time, authorize in
writing by amendment thereto. Distributor shall offer the Contracts for sale
and distribution at premium rates set by PL&A.
2. Selling Agreements. Distributor is hereby authorized to enter into separate
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written agreements, on such terms and conditions as Distributor determines
are not inconsistent with this Agreement, with such organizations which
agree to participate as a general agent and/or broker-dealer in the
distribution of the Contracts and to use their best efforts to solicit
applications for Contracts. Any such broker-dealer (hereinafter "Broker")
shall be both registered as a broker-dealer under the Securities Exchange
Act and a member of the NASD. Distributor shall be responsible for ensuring
that Broker and its agents or representatives and general agent and its sub-
agents
soliciting applications for Contracts shall be duly and appropriately
licensed, registered and otherwise qualified for the sale of the Contracts
(and the riders and other contracts offered in connection therewith) under
the insurance laws and any applicable blue sky laws of each state or other
jurisdiction in which such policies may be lawfully sold and in which PL&A
is licensed to sell such Contracts. PL&A shall undertake to appoint Broker's
qualified agents or representatives and general agent's sub-agents as life
insurance agents of PL&A, provided that PL&A reserves the right to refuse to
appoint any proposed representative, agent, or sub-agent or once appointed,
to terminate such appointment. Distributor shall be responsible for ensuring
that Broker and general agent supervise its agents, representatives, or sub-
agents.
Distributor is also authorized to enter into separate written agreements, on
such terms and conditions as Distributor determines are not inconsistent
with this Agreement, with such organizations ("Wholesalers") that agree to
participate in the distribution of the Contracts and to use their best
efforts to solicit Brokers and general agents that, in turn, will solicit
applications of the Contracts.
3. Life Insurance Agents. PL&A shall be responsible for ensuring that Broker
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and its agents or representatives and general agent and its sub-agents meet
all qualifications and hold any licenses or authorizations that may be
required for the solicitation or sale of the Contracts under the insurance
laws of the applicable jurisdictions.
4. Suitability. PL&A desires to ensure that Contracts will be sold to
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purchasers for whom the Contract will be suitable. Distributor shall take
reasonable steps to ensure that the various representatives of Broker and
sub-agents of general agents shall not make recommendations to an applicant
to purchase a Contract in the absence of reasonable grounds to believe the
purchase of the Contract is suitable for such applicant. While not limited
to the following, a determination of suitability shall be based on
information furnished to a representative or sub-agent after reasonable
inquiry of such applicant concerning the applicant's other security
holdings, insurance and investment objectives, financial situation and
needs, and the likelihood that the applicant will continue to make any
premium payments contemplated by the Contracts and will keep the Policy in
force for a sufficient period of time so that PL&A's acquisition costs are
amortized over a reasonable period of time.
5. Conformity with Registration Statement and Approved Sales Materials. In
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performing its duties as Distributor, Distributor will act in conformity
with the Prospectus and with the instructions and directions of PL&A, the
requirements of the 1933 Act, the 1940 Act, the Securities Exchange Act, and
all other applicable federal and state laws and regulations. Distributor
shall not give any information nor make any representations, concerning any
aspect of the Contract or of PL&A's operations to any persons or entity
unless such information or representations are contained in the Registration
Statement and the pertinent prospectus filed with the Securities and
Exchange Commission, or are contained in sales or promotional literature
approved by PL&A. Distributor will not use and will take reasonable steps to
ensure Broker will not use any sales promotion material and advertising that
has not been previously approved by PL&A.
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6. Expenses. During the term of this Agreement, Distributor will bear all of
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its expenses in complying with this Agreement, including the following
expenses:
(a) costs of sales presentations, mailings, sales promotion materials,
advertising, and any other marketing efforts by Distributor in
connection with the distribution or sale of the Contracts; and
(b) any compensation paid to employees of Distributor and to wholesalers,
Brokers, and general agents in connection with the distribution or sale
of the Contracts.
Notwithstanding any other provision of this Agreement, it is understood and
agreed that PL&A shall at all times retain the ultimate responsibility for
and control of all functions performed pursuant to this Agreement, and for
marketing the Contract, and reserves the right to direct, approve or
disapprove any action hereunder taken on its behalf by Distributor.
7. Applications. Completed applications for Contracts solicited by such Broker
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through its agents or representatives or by general agent through its sub-
agents shall be transmitted directly to PL&A. All payments under the
Contracts shall be made by check to PL&A or by other method acceptable to
PL&A, and if received by Distributor, shall be held at all times in a
fiduciary capacity and remitted promptly to PL&A. All such payments will be
the property of PL&A. PL&A has the sole authority to approve or reject such
applications or payments and maintains ultimate responsibility for
underwriting. Anything in this Agreement to the contrary notwithstanding,
PL&A retains the ultimate right to control the sale of the Contracts and to
appoint and discharge life insurance agents of PL&A.
8. Standard of Care. Distributor shall be responsible for exercising
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reasonable care in carrying out the provisions of this Agreement.
9. Reports. Distributor shall be responsible for maintaining the records of
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Broker and general agent and their agents, representatives or sub-agents who
are licensed, registered and otherwise qualified to sell the Contracts;
calculating and furnishing the fees payable to Brokers or general agents;
and for furnishing periodic reports to PL&A as to the sale of Contracts made
pursuant to this Agreement.
10. Records. Distributor shall maintain and preserve such records as are
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required of it by applicable laws and regulations. The books, accounts, and
records of PL&A, the Separate Accounts, and Distributor shall be maintained
to clearly and accurately disclose the nature and details of the
transactions, including such accounting information as necessary to support
the reasonableness of the amounts to be paid by PL&A hereunder.
11. Compensation. For the services rendered and product development in the
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initial sales efforts and continuing obligations under this Agreement, PL&A
shall pay Distributor in the amounts set forth in Schedule A, which schedule
is incorporated herein. PL&A shall arrange for the payment of commissions,
through Distributor, to those Brokers and general agents that sell Contracts
under agreements entered into pursuant to Section 2, hereof, and to
wholesalers that solicit brokers and
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general agents to sell Contracts under agreements entered into pursuant to
Section 2, hereof, in amounts as may be agreed to by PL&A and Distributor
specified in such written agreements.
12. Investigation and proceedings. Distributor and PL&A agree to cooperate
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fully in any insurance regulatory investigation or proceeding or judicial
proceeding arising in connection with the Contracts distributed under this
Agreement. Distributor further agrees to furnish regulatory authorities with
any information or reports in connection with such services that may be
requested in order to ascertain whether the operations of PL&A and the
Separate Accounts are being conducted in a manner consistent with applicable
laws and regulations. Distributor and PL&A further agree to cooperate fully
in any securities regulatory investigation or proceeding with respect to
PL&A, Distributor, their affiliates and their agents or representatives to
the extent that such investigation or proceeding is in connection with
Contracts distributed under this Agreement. Without limiting the foregoing:
(a) Distributor will be notified promptly of any customer complaint or
notice of any regulatory investigation or proceeding or judicial
proceeding received by PL&A with respect to Distributor or any agent,
representative, or sub-agent of a Broker or general agent or which may
affect PL&A's issuance of any Contract sold under this Agreement; and
(b) Distributor will promptly notify PL&A of any customer complaint or
notice of any regulatory investigation or proceeding received by
Distributor or its affiliates with respect to Distributor or any agent,
representative, or sub-agent of a Broker or general agent in connection
with any Contract distributed under this Agreement or any activity in
connection with any such Contract.
In the case of a meritorious customer complaint, Distributor and PL&A will
cooperate in investigating such complaint and any response will be sent to
the other party to this Agreement 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 telegraph.
13. Indemnification. PL&A hereby agrees to indemnify and hold harmless
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Distributor and its officers and directors, and employees for any expenses
(including legal expenses), losses, claims, damages, or liabilities incurred
by reason of any untrue or alleged untrue statement or representation of a
material fact or any omission or alleged omission to state a material fact
required to be stated to make other statements not misleading, if made in
reliance on any prospectus, registration statement, post-effective amendment
thereof, or sales materials supplied or approved by PL&A or the Separate
Accounts. PL&A shall reimburse each such person for any legal or other
expenses reasonably incurred in connection with investigating or defending
any such loss, liability, damage, or claim. However, in no case shall PL&A
be required to indemnify for any expenses, losses, claims, damages, or
liabilities that have resulted from the willful misfeasance, bad faith,
negligence, misconduct, or wrongful act of Distributor.
Distributor hereby agrees to indemnify and hold harmless PL&A, its officers,
directors, and employees, and the Separate Accounts for any expenses,
losses, claims, damages, or liabilities
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arising out of or based upon any of the following in connection with the
offer or sale of the contracts: 1) except for such statements made in
reliance on any prospectus, registration statement or sales material
supplied or approved by PL&A or the Separate Accounts, any untrue or alleged
untrue statement of representation made; 2) any failure to deliver a
currently effective prospectus; 3) the use of any unauthorized sales
literature by any officer, employee, agent, or sub-agent of Distributor,
Broker or general agent; or 4) any willful misfeasance, bad faith,
negligence, misconduct or wrongful act. Distributor shall reimburse each
such person for any legal or other expenses reasonably incurred in
connection with investigating or defending any such loss, liability, damage,
or claim.
Promptly after receipt by a party entitled to indemnification ("Indemnified
Party") of notice of the commencement of any action, if a claim for
indemnification in respect thereof is to be made against PL&A or Distributor
("Indemnifying Party") such Indemnified Party will notify Indemnifying Party
in writing of the commencement thereof, but failure to notify the
Indemnifying Party of any claim shall not relieve it from any liability
which it may have to the person against whom such action is brought
otherwise than on account of this agreement contained in this Section 13.
The Indemnifying Party will be entitled to participate in the defense of the
Indemnified Party and such participation will not relieve such Indemnifying
Party of the obligation to reimburse the Indemnified Party for reasonable
legal and other expenses incurred by such Indemnified Party in defending
himself.
14. Agent of Pacific Life & Annuity Company or Separate Accounts. Any person,
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even though also an officer, director, employee, or agent of Distributor,
who may be or become an officer, director, employee, or agent of PL&A or the
Separate Accounts shall be deemed when rendering services to PL&A or the
Separate Accounts or acting in any business of PL&A or the Separate
Accounts, to be rendering such services to or acting solely for PL&A or the
Separate Accounts and not as an officer, director, employee, or agent or one
under the control or direction of Distributor even thought paid by
Distributor. Likewise, any person even though also an officer, director,
employee, or agent of PL&A or the Separate Accounts, who may be or become an
officer, director, employee, or agent of Distributor shall be deemed, when
rendering services to Distributor or acting in any business of Distributor,
to be rendering such services to or acting solely for Distributor and not as
an officer, director, employee, or agent or one under the control or
direction of PL&A or the Separate Accounts even though paid by PL&A or the
Separate Accounts.
15. Books and Records. It is expressly understood and agreed that all
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documents, reports, records, books, files and other materials relating to
this Agreement and the services to be performed hereunder shall be the sole
property of PL&A and the Separate Accounts and that such property shall be
held by Distributor as agent, during the effective term of this Agreement.
Distributor shall deliver this material to PL&A upon the termination of this
Agreement free from any claim or retention of rights. During the term of
this Agreement and for a period of three years from the date of termination
of this Agreement, Distributor will not disclose or use any records or
information and will regard and preserve as confidential all information
related to the business of PL&A or the Separate Accounts that may be
obtained by Distributor from any source as a result of this Agreement and
will disclose such information only if PL&A or the Separate Accounts has
authorized such disclosure, or if such disclosure is expressly required by
applicable federal or state
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regulatory authorities. Distributor further acknowledges and agrees that, in
the event of a breach or threatened breach by it of the provisions of this
article, PL&A will have no adequate remedy in moneys or damages and,
accordingly, PL&A shall be entitled in its discretion to seek an injunction
against such breach. However, no specification in this Agreement of a
specific legal or equitable remedy shall be construed as a waiver or
prohibition against any other legal or equitable remedy in the event of a
breach of a provision of this Agreement.
16. Employees. Distributor will not employ, except with the prior written
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approval of the Commissioner of Insurance of the state of Arizona, in any
material connection with the handling of the Separate Accounts' assets any
person who, to the knowledge of Distributor:
(a) in the last 10 years has been convicted of any felony or misdemeanor
arising out of conduct involving embezzlement, fraudulent conversion,
or misappropriation of funds or securities, or involving violations of
Sections 1341, 1342, or 1343 of Xxxxx 00, Xxxxxx Xxxxxx Code; or
(b) within the last 10 years has been found by any state regulatory
authority to have violated or has acknowledged violation of any
provision of any state insurance law involving fraud, deceit, or
knowing misrepresentation; or
(c) within the last 10 years has been found by any federal or state
regulatory authorities to have violated or have acknowledged violation
of any provision of federal or state securities laws involving fraud,
deceit, or knowing misrepresentation.
17. Termination. This Agreement shall terminate automatically upon its
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assignment without the prior written consent of both parties. This Agreement
may be terminated at any time, for any reason, by either party on 60 days'
written notice to the other party, without the payment of any penalty. Upon
termination of this Agreement, all authorizations, rights, and obligations
shall cease except the obligation to settle accounts hereunder, including
commissions on premiums subsequently received for Contracts in effect at
time of termination, and the agreements contained in Sections 12 and 13
hereof.
18. Regulations. This Agreement shall be subject to the provisions of the 1940
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Act and the Securities Exchange Act and the rules, regulations and rulings
thereunder, and of the applicable rules and regulations of the NASD, and
applicable state insurance law and other applicable law, from time to time
in effect, and the terms hereof shall be interpreted and construed in
accordance therewith.
19. Independent Contractor. Distributor shall act as an independent contractor
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and nothing herein contained shall constitute Distributor or its agents,
officers or employees as agents, officers, or employees of PL&A in
connection with the sale of the Contracts.
20. Notices. Any notice required or otherwise given pursuant to this Agreement
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shall be in writing and shall be duly given if mailed, first class postage
prepaid, or delivered. The current address for mailing purposes of this
Agreement shall be set forth on the signature page.
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21. Severability. If any provisions of this Agreement shall be held or made
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invalid by a court decision, statute, rule or otherwise, the remainder of
this Agreement shall not be affected thereby.
22. Governing Law. This Agreement shall be construed and enforced in
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accordance with and governed by the laws of the State of Arizona.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed as of the day and year first above written.
Pacific Life & Annuity Company Pacific Select Distributors, Inc.
000 Xxxxxxx Xxxxxx Xxxxx 000 Xxxxxxx Xxxxxx Xxxxx
Xxxxxxx Xxxxx, XX 00000 Xxxxxxx Xxxxx, XX 00000
By: /s/ XXXX X. XXXXXX By: /s/ XXXXXX XXXXXX
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Name: Xxxx X. Xxxxxx Name: Xxxxxx Xxxxxx
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Title: Executive Vice President Title: Vice President
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Date: April 28, 2000 Date: April 28, 2000
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By: /s/ XXXXX X. XXXXXX By: /s/ XXXXXX X. MILFS
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Name: Xxxxx X. Xxxxxx Name: Xxxxxx X. Milfs
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Title: Vice President Title: Secretary
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Date: April 28, 2000 Date: April 28, 2000
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EXHIBIT A
PACIFIC SELECT EXEC SEPARATE ACCOUNT
SEPARATE ACCOUNT A
IN WITNESS WHEREOF, the parties hereto have caused this Exhibit A to be executed
by their Officers designated below on this 28th day of April, 2000.
Pacific Life & Annuity Company Pacific Select Distributors, Inc.
000 Xxxxxxx Xxxxxx Xxxxx 000 Xxxxxxx Xxxxxx Xxxxx
Xxxxxxx Xxxxx, XX 00000 Xxxxxxx Xxxxx, XX 00000
By: /s/ XXXXX X. XXXXXX By: /s/ XXXXXX X. MILFS
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Name: Xxxxx X. Xxxxxx Name: Xxxxxx X. Milfs
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Title: Vice President Title: Secretary
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