The Penn Insurance and Annuity Company
Independence Square, Philadelphia, PA 19172
National Accounts - Broker-Dealers Licensed
to Sell Variable Annuities and/or Variable
Life Insurance under Federal Securities and
State Insurance Laws
BROKER-DEALER SELLING AGREEMENT
THE PENN INSURANCE AND ANNUITY COMPANY (hereinafter called "PIA") and
Xxxxxx, Xxxxxxxx & Xxxx, Inc. (hereinafter called "Distributor) enter into this
Agreement with_______________________ (hereinafter called "Broker-Dealer")
on this date _________________________, 19____ agree as follows:
W I T N E S S E T H:
WHEREAS, PIA is in the business of issuing annuity and life insurance
contracts to the public;
WHEREAS, Distributor is an affiliate of PIA, is registered as a
broker-dealer under the Securities Exchange Act of 1934, is a member of the
National Association of Securities Dealers, Inc., and is assisting PIA in the
distribution of such contracts;
WHEREAS, Broker-Dealer is properly licensed to sell variable annuity
and variable life insurance contracts under the insurance laws of the state(s)
in which Broker-Dealer will act under this Agreement is registered as a
Broker-Dealer under the Securities Exchange Act of 1934 and is a member of the
National Association of Securities Dealer, Inc.;
WHEREAS, PIA and Distributor desire to appoint Broker-Dealer to solicit
applications for certain annuity and/or variable life insurance contracts issued
by PIA and Broker-Dealer desires to accept such appointment;
NOW THEREFORE, in consideration of these premises and mutual covenants
herein contained, the parties agree as follows:
1. APPOINTMENT OF BROKER DEALER.
1.1 Subject to the terms and conditions of this agreement, PIA and
Distributor appoint Broker-Dealer as a non-exclusive Broker-Dealer for
the solicitation of applications for, and the servicing of, annuity
and/or variable life insurance contracts identified in the schedule(s)
attached hereto, and Broker-Dealer accepts such appointment The annuity
and/or variable life insurance contracts identified in the schedules(s)
are referred to herein as "Contracts".
1.2 Broker-Dealer and its representatives shall be independent contractors
as to PIA and Distributor and, subject to the terms and conditions of
this agreement, free to exercise their own judgment as to the time,
place and means of performing all acts hereunder. Nothing in this
agreement is intended to create a relationship of employer and employee
as between PIA or Distributor, on the one hand, and representatives of
Broker-Dealer on the other.
2. SALE OF CONTRACTS.
2.1 Broker-Dealer shall use its best efforts to solicit applications for
Contracts from persons for whom the Contracts are suitable, and to
service such Contracts in accordance with the terms and conditions of
this agreement.
2.2 All applications for Contracts shall be made on application forms
authorized by PIA. Broker-Dealer shall diligently review all such
applications for accuracy and completeness and shall take all reasonable
and appropriate measures to assure that applications submitted to PIA
are accurate and complete.
2.3 All payments collected by Broker-Dealer for PIA shall be received in
trust and shall be remitted immediately together with all required
documentation, to PIA at the address indicated on the application or to
such other address as PIA may specify in writing. All checks or money
orders for payment under Contracts shall be drawn to the order of PIA.
2.4 All applications are subject to acceptance or rejection by PIA in its
sole discretion. PIA may at any time in its sole discretion discontinue
issuing the Contracts or change the form and content of new Contracts to
be issued.
2.5 In soliciting applications for Contracts, Broker-Dealer may not accept
risks of any kind for or on behalf of PIA and may not bind PIA by
promise or agreement or alter any Contract in any way.
3. COMPENSATION.
3.1 In consideration of and as full compensation for the services performed
in accordance with this agreement, Broker-Dealer will receive
compensation from PIA as set forth in the schedule(s) attached to this
agreement.
3.2 Should PIA for any reason return any payment made under a Contract to
the payor, Broker-Dealer shall repay PIA the total amount of any
compensation which PIA may have paid with respect to such payment.
3.3 Broker-Dealer may not withhold or deduct any part of any premium or
other payment due PIA for payment of compensation under this agreement
or for any other purpose. The right of Broker-Dealer to receive any
compensation under this agreement shall at all times be subordinate to
the right of PIA or Distributor to offset or apply such compensation
against any indebtedness of Broker-Dealer to PIA or Distributor.
3.4 PIA may, in its sole discretion, change the amount, terms and
conditions, of compensation with respect to payment received by PIA
under Contracts.
3.5 PIA shall not be obligated to pay any compensation which would be in
violation of applicable laws of any jurisdiction, anything in this
agreement to the contrary notwithstanding.
4. COMPLIANCE WITH INSURANCE LAWS AND REGULATIONS.
4.1 Broker-Dealer and its representative shall not solicit applications for
Contracts in any state or jurisdiction unless they are duly licensed and
qualified to do so under the insurance laws and regulations of the state
or jurisdiction and unless PIA has notified Broker-Dealer that the
Contracts have been approved for sale in the state or jurisdiction.
4.2 PIA may, at any time, in its sole discretion, withhold or withdraw
authority of any representative of Broker-Dealer to solicit applications
for the Contracts. Upon PIA giving written notice to Broker-Dealer of
its withdrawal of authority of a representative to solicit applications,
Broker-Dealer shall immediately cause any such representative to cease
all such solicitations.
4.3 Broker-Dealer shall notify PIA in writing immediately of the termination
of the employment or affiliation of an employee or representative who is
an appointed agent of PIA pursuant to this agreement.
4.4 Broker-Dealer shall keep accurate and complete books and records of all
transactions relating to the solicitation of applications and for
servicing Contacts. The books and records shall be made available to PIA
for inspection upon reasonable request.
4.5 If Broker-Dealer solicits applications for variable life insurance
contracts under this agreement, Broker-Dealer and its representative
shall observe the Standards of Suitability for the Sale of Variable Life
Insurance set forth on the reverse side of the schedule attached hereto
identifying such contracts.
4.6 Broker-Dealer and its representatives shall comply with all applicable
insurance laws and regulations in soliciting applications for the
servicing Contracts. Broker-Dealer shall be fully responsible for all
acts of its representatives in soliciting applications for and servicing
Contracts.
5. COMPLIANCE WITH SECURITIES LAWS.
5.1 Broker-Dealer shall not solicit applications for variable annuity or
variable life insurance contracts unless PIA or Distributor has notified
Broker-Dealer that a registration statement required under the
Securities Act of 1933 is effective as to such contracts and unless
Broker-Dealer is duly registered as a broker-dealer under the Securities
Exchange Act of 1934, is a member in good standing of the National
Association of Securities Dealers, Inc. and is duly licensed under any
applicable securities laws of the state or jurisdiction in which
Broker-Dealer engages in such activity.
5.2 PIA or Distributor shall furnish Broker-Dealer with copies of the
current prospectuses (and current supplements thereto) required to be
used in soliciting application for variable annuity and/or variable life
insurance contracts.
5.3 Broker-Dealer and its representatives shall comply with all applicable
securities laws and regulations and with the rules of the National
Association of Securities Dealers, Inc. in soliciting applications for
and servicing variable annuity and/or variable life insurance contracts.
Broker-Dealer shall be fully responsible for all acts of its
representatives in soliciting applications for and servicing variable
annuity and/or variable life insurance contracts.
6. ADVERTISEMENTS, SALES LITERATURE AND OTHER COMMUNICATIONS.
6.1 Broker-Dealer shall not print, publish, distribute or use any
advertisements, sales literature or other writing relating to the
Contracts unless such advertisements, sales literature or other writing
shall have first been approved in writing by PIA and Distributor.
6.2 Broker-Dealer shall exercise care not to misrepresent the Contracts or
PIA and shall make no oral or written representation which is
inconsistent with the terms of the Contracts or with the information in
any prospectus or sales literature furnished by PIA or it misleading in
any way.
7. INDEMNIFICATION.
7.1 Broker-Dealer shall indemnify or hold harmless PIA and Distributor and
each director and officer of PIA and Distributor against any losses,
claims, damages or liabilities, including but not limited to reasonable
attorneys' fees and court cost to which PIA or Distributor and any such
director or officer may become subject, under the Securities Act of 1933
or otherwise, insofar as such losses, claims, damages or liabilities (or
actions in respect thereof) arise out of or are based upon any
unauthorized use of sales materials or any verbal or written
misrepresentations or any unlawful sales practices, or the failure of
Broker-Dealer, its officers, employees or representative to comply with
the provisions of this agreement or the willful misfeasance, bad faith,
negligence or misconduct of Broker-Dealer, its officers, employees, or
representatives in the solicitation of applications for and the
servicing of Contracts.
7.2 PIA and Distributor shall indemnify and hold harmless Broker-Dealer and
each officer or director of Broker-Dealer against any losses, claims,
damages or liabilities, joint or several, including but not limited to
reasonable attorneys, fees and court cost to which Broker-Dealer or such
officer or director becomes subject under the Securities Act of 1933 or
otherwise, insofar as such losses, claims, damages or liabilities (or
actions in respect thereof) arise out of or are based upon any untrue
statement or alleged untrue statement of a material fact, required to be
stated therein or necessary to make the statements therein not
misleading contained in any registration statement or any post-effective
amendment or supplement to the prospectus, or in any sales material
written by PIA or Distributor.
7.3 In the event PIA suffers a loss resulting from Broker-Dealer activities,
Broker-Dealer hereby assigns any proceeds received under its fidelity
bond to PIA to the extent of such losses. If there is any deficiency
amount, whether due to a deductible or otherwise, Broker-Dealer shall
promptly pay PIA such amount on demand and Broker-Dealer shall indemnify
and hold harmless PIA from any such deficiency and from the costs of
collection thereof (including reasonable attorneys' fees).
8. COMPLAINTS, INVESTIGATIONS & PROCEEDINGS.
8.1 Broker-Dealer shall promptly notify PIA and Distributor of any
allegation that Broker-Dealer or any of its representatives violated any
law, regulation or rule in soliciting applications for or servicing
Contracts, and shall provide PIA with full details, including copies of
all legal documents pertaining thereto.
8.2 Broker-Dealer shall cooperate fully with PIA and Distributor in any
regulatory investigation or proceeding or judicial proceeding involving
the solicitation of application for and servicing Contracts by
Broker-Dealer or any of its representatives.
9. NONWAIVER.
9.1 Forbearance by PIA or Distributor to enforce any rights under this
agreement shall not be construed as a waiver of any of the terms and
conditions of this agreement and the same shall remain in full force and
effect. No waiver of any provision of this agreement shall be deemed to
be a waiver of any other provision, whether or not similar, nor shall
any waiver of a provision of this agreement be deemed to constitute a
continuing waiver.
10. AMENDMENT.
10.1 PIA reserves the right to amend this Agreement at any time.
Broker-Dealer's submission of an application for a Contract after
notice of any such amendment shall constitute agreement of
Broker-Dealer to such amendment.
11. TERMINATION AND ASSIGNMENT.
11.1 This agreement may be terminated by any party, with or without cause,
upon giving written notices to the other parties. This agreement shall
automatically terminate if Broker-Dealer is adjudicated as bankrupt or
avails itself of any insolvency act or if a permanent receiver or
trustee in bankruptcy is appointed for the property of Broker-Dealer.
Upon termination of this agreement, with or without cause, all
authorizations, rights and obligations shall cease, except the rights
and obligations set forth in sections 7 and 8 of this agreement and the
obligations to settle account hereunder, including the immediate
forwarding of all payments received by Broker-Dealer under Contract to
PIA, and except as may be expressly stated otherwise in this agreement.
11.2 This agreement may not be assigned without the written consent of all
parties.
12. GOVERNING LAW.
12.1 This agreement shall be construed in accordance with and governed by
the laws of the Commonwealth of Pennsylvania.
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed by their officers designated below on the day and year
first written.
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Name of Broker-Dealer
By:
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Signature
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Name
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Title
THE PENN INSURANCE AND ANNUITY COMPANY
By:
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Signature
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Name
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Title
XXXXXX, XXXXXXXX & XXXX, INC.
By:
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Signature
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Name
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Title
The Penn Insurance and Annuity Company
Independence Square, Philadelphia, PA 19172
AMENDMENT TO BROKER-DEALER SELLING AGREEMENT
Individual Variable and Fixed Annuity Contracts - Pennant
Date of Broker-Dealer Selling Agreement to which this Amendment is attached:
__________________________________________
1. SUBSECTION 2.3 OF SECTION 2 OF THE BROKER-DEALER SELLING AGREEMENT IS AMENDED
TO PROVIDE AS FOLLOWS:
All payments collected by Broker-Dealer shall be received in
trust and shall be remitted immediately, together with all
required documentation, to PIA at the address stated on the
application or to such other address as PIA may specify in
writing. All checks and money orders for payments under
Contracts shall be drawn to the order of PIA. Notwithstanding
the foregoing, in cases where Broker-Dealer deducts
compensation from premiums and other payments, as provided for
in subsection 3.3 of Section 3 below, checks and money orders
may be made payable to Broker-Dealer and the Broker-Dealer may
send the remaining balance (after deducting compensation ) to
PIA, provided the balance is remitted immediately to PIA.
2. SUBSECTION 3.3 OF SECTION 3 OF THE BROKER-DEALER SELLING AGREEMENT IS AMENDED
TO PROVIDE AS FOLLOWS:
Except as provided in this subsection, Broker-Dealer may not
withhold or deduct any part of any premium or other payment
due PIA for payment of compensation under this agreement or
for any other purpose. Broker-Dealer may deduct compensation
as set forth in Schedule 1 attached to the Agreement and may
send the remaining balance to PIA provided that in doing so
Broker-Dealer complies fully with Rule l5c3-3(k)(2)(i) under
the Securities Exchange Act of 1934, to the extent applicable.
The right of Broker-Dealer to receive or retain any
compensation under this agreement shall at all times be
subordinate to the right of PIA or Distributor to offset or
apply such compensation against any indebtedness of
Broker-Dealer to PIA or Distributor.
Agreed:
Date:
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Broker-Dealer
By:
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Signature
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Name
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Title
XXXXXX, XXXXXXXX & XXXX, INC.
By:
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Signature
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Name
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Title
THE PENN INSURANCE AND ANNUITY COMPANY
By:
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Signature
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Name
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Title
