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Form of Broker
Dealer Agreement
Exhibit 99.3(iv)
[MANULIFE FINANCIAL LOGO] Draft 2 - August 20, 2001
General Agent and Broker-Dealer Selling Agreement
Manulife Financial and the block design are registered service marks and
trademarks of The Manufacturers Life Insurance Company and are used by it and
its affiliates including Manulife Financial Corporation.
AG1010US (08/2001)
2
[MANULIFE FINANCIAL LOGO] General Agent and Broker-Dealer Selling Agreement
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AGREEMENT, dated as of the effective date as provided below, by and
among The Manufacturers Life Insurance Company (U.S.A.) ("Manulife USA"),
ManEquity, Inc. ("ManEquity"), the undersigned general agent ("General Agent")
and the undersigned broker-dealer ("Broker-Dealer").
WHEREAS, Manulife USA issues life insurance and annuity contracts, some
of which are exempted securities pursuant to Section 3 of the Securities Act of
1933 (the "1933 Act") and therefore not subject to registration under the 1933
Act ("Insurance Contracts"), and some of which are not exempted securities
pursuant to Section 3 of the 1933 Act and therefore subject to registration
under the 1933 Act unless sold in exempt transactions ("Securities Contracts");
and
WHEREAS, Manulife USA has appointed ManEquity as the principal
underwriter for the Securities Contracts; and
WHEREAS, General Agent and Broker-Dealer desire to sell certain
Securities Contracts and Insurance Contracts (collectively, the "Contracts") in
accordance with the provisions set forth in the Contracts, Commissions and Fees
Schedule (the "Contracts Schedule") which is Exhibit A to this Agreement;
WHEREAS, General Agent desires to have its sub-agents who are not also
registered representatives of Broker-Dealer appointed as agents of Manulife USA
for the purpose of selling some or all of the Insurance Contracts ("Insurance
Agents"), and General Agent and Broker-Dealer desire to have General Agent's
sub-agents who are also registered representatives of Broker-Dealer appointed as
agents of Manulife USA for the purpose of selling some or all of the Contracts
("Securities Agents")(Insurance Agents and Securities Agents are hereinafter
collectively referred to as "Agents"); and
WHEREAS, if General Agent and Broker-Dealer are the same person, the
term "General Agent" in this Agreement shall refer to Broker-Dealer, which shall
undertake all the duties, responsibilities and privileges of General Agent under
this Agreement;
NOW, THEREFORE, in consideration of the premises and the mutual
covenants herein contained, the parties hereto agree as follows:
1. APPOINTMENT AND AUTHORIZATION
a. Manulife USA and ManEquity appoint and authorize, on a non-exclusive
basis, General Agent and Broker-Dealer to solicit sales of the Contracts in
those jurisdictions in which Manulife USA is admitted to do business, the
Contracts have been approved for sale by the appropriate regulatory authorities
and General Agent and Broker-Dealer are properly licensed to conduct business.
General Agent and Broker-Dealer accept such appointment and authorization, and
each agrees to use its best efforts to find purchasers of the Contracts
acceptable to Manulife USA and to provide ongoing services to those purchasers
with respect to the Contracts.
b. Each of General Agent and Broker-Dealer is performing the acts
covered by this Agreement in the capacity of an independent contractor and not
as an employee or partner of or a joint venturer with Manulife USA or ManEquity
and is authorized to represent Manulife USA and ManEquity only to the extent
expressly authorized by this Agreement. No further authority is granted or
implied.
2. LICENSING AND APPOINTMENT OF AGENTS
a. General Agent is authorized to designate persons for appointment by
Manulife USA as Agents to solicit applications for the Contracts, to deliver the
Contracts and to collect the first premium (as used herein, the term "premium"
shall refer to any premium payment, deposit or contribution, as applicable, paid
or payable in connection with a Contract) thereon in conformance with applicable
state laws and Manulife USA's rules and procedures. General Agent shall not
propose an Agent for appointment unless such Agent is duly licensed as an
insurance agent in the state(s) in which it is proposed that such Agent solicit
applications for the Contracts and, if the Agent is to sell Securities
Contracts, unless the Agent is a registered representative of Broker-Dealer.
General Agent shall be responsible for such Agents' continuing compliance with
applicable licensing requirements under state insurance laws, and Broker-Dealer
shall be responsible for such Agents' continuing compliance with applicable
registration requirements under federal and state securities laws.
b. General Agent shall assist Manulife USA in the appointment of Agents
under applicable insurance laws and, in that connection, shall prepare and
transmit to Manulife USA appropriate licensing and appointment forms, shall
fulfill all requirements set forth in the General Letter of Recommendation
attached as Exhibit B to this Agreement and shall comply with such other related
policies and procedures as Manulife USA from time to time may establish or amend
in its sole discretion.
c. Manulife USA shall pay the initial appointment fees and renewal fees
required under state insurance laws to appoint each previously licensed person
as an agent of Manulife USA for the sale of Contracts. General Agent shall be
responsible for all other state insurance appointment and licensing fees with
respect to the Agents, including license issue, transfer and termination fees.
Broker-Dealer shall be responsible for all fees, including registration and
examination fees, necessary to maintain Securities Agents' continuing compliance
with applicable registration requirements under federal and state securities
laws and the rule of self-regulatory organizations.
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Manulife Financial and the block design are registered service marks and
trademarks of The Manufacturers Life Insurance Company and are used by it and
its affiliates including Manulife Financial Corporation.
AG1010US (08/2001)
3
d. Manulife USA, in its discretion, may refuse to appoint any Agent
designated by General Agent or, after it has appointed an Agent, may terminate
or refuse to renew such Agent's appointment or may withdraw the Agent's right to
solicit applications for some or all of the Contracts, in which case General
Agent shall cause such Agent to cease solicitations.
e. With the frequency reasonably requested by Manulife USA, General
Agent shall provide Manulife USA with a list of all Agents, indicating which of
them are Securities Agents, and the jurisdictions where such Agents are licensed
to solicit sales of the Contracts. With the frequency reasonably requested by
General Agent, Manulife USA shall provide General Agent with a list which shows
the jurisdictions in which Manulife USA is admitted to do business and the
Contracts that have been approved for sale in each of those jurisdictions.
3. SUPERVISION OF AGENTS
a. Except to the extent that Broker-Dealer is responsible therefor,
General Agent shall supervise all Agents and be responsible for their training
and compliance with applicable insurance laws and regulations, and if any act or
omission of an Agent or employee of General Agent is the proximate cause of any
loss, claim, damage, liability or expense (including reasonable attorneys' fees)
to Manulife USA or ManEquity, General Agent shall be liable therefor. Broker-
Dealer shall supervise Securities Agents and be responsible for their training
and compliance with applicable federal and state securities laws and regulations
and the rules of the National Association of Securities Dealers, Inc. ("NASD"),
and if any act or omission of a Securities Agent or employee of Broker-Dealer is
the proximate cause of any loss, claim, damage, liability or expense (including
reasonable attorneys' fees) to Manulife USA or ManEquity, Broker-Dealer shall be
liable therefor. General Agent and Broker-Dealer shall insure that only
Securities Agents solicit applications for Securities Contracts. Manulife USA
and ManEquity shall not have any responsibility for the supervision, training or
compliance with any law or regulation of any Agent or any employee of General
Agent or Broker-Dealer, and nothing in this Agreement shall be deemed to make
such an Agent or employee an agent or employee of Manulife USA or ManEquity.
b. General Agent shall (i) supervise Agents' compliance with all
applicable suitability requirements under state insurance laws and regulations
and (ii) provide adequate training to insure that Agents have thorough knowledge
of each Insurance Contract and the ability to make appropriate product
presentations and suitability determinations in compliance with applicable law.
Broker-Dealer shall (i) supervise Securities Agents' compliance with all
applicable suitability requirements under federal and state securities laws and
regulations and NASD rules and (ii) provide adequate training to insure that
Securities Agents have thorough knowledge of each Securities Contract and the
ability to make appropriate product presentations and suitability determinations
in compliance with applicable law. Each of General Agent and Broker-Dealer shall
not, and shall cause the Agents not to, recommend the purchase of a Contract to
a prospective purchaser unless it has reasonable grounds to believe that such
purchase is suitable for the prospective purchaser and is in accordance with
applicable rules and regulations of any regulatory authority, including, in the
case of Securities Contracts, the Securities and Exchange Commission ("SEC") and
the NASD. General Agent, in submitting an application for an Insurance Contract,
and Broker-Dealer, in submitting an application for a Securities Contract, will
be deemed to have warranted to Manulife USA, and to ManEquity in the case of a
Securities Contract, that it has made a determination of suitability based on
information concerning the prospective purchaser's insurance and investment
objectives, risk tolerance, need for liquidity, and financial and insurance
situation and needs, or on such other factors that General Agent or
Broker-Dealer deems to be appropriate under the circumstances and in compliance
with applicable law.
c. If an Agent performs any unauthorized transaction with respect to a
Contract, fails to submit to the supervision of or otherwise meet the rules and
standards of General Agent or Broker-Dealer, or fails to hold any required
license, appointment, registration or association with Broker-Dealer, General
Agent and Broker-Dealer immediately shall notify Manulife USA in writing and act
to terminate the sales activities of such Agent relating to the Contracts.
d. Upon request by Manulife USA or ManEquity, General Agent and
Broker-Dealer shall furnish appropriate records or other documentation to
evidence the diligent supervision of Agents by General Agent and Broker-Dealer.
4. OBLIGATIONS OF GENERAL AGENT AND BROKER-DEALER
a. General Agent and Broker-Dealer shall permit Agents to solicit
applications for Contracts only if they (i) are duly licensed insurance Agents
and appointed by Manulife USA and (ii) in the case of Securities Contracts, are
also registered representatives of Broker-Dealer.
b. All applications for Contracts shall be made on application
forms supplied by Manulife USA; shall be reviewed by General
Agent, in the case of Insurance Contracts, and by
Broker-Dealer, in the case of Securities Contracts, for
completeness and correctness, as well as compliance with
applicable suitability standards; in the case of Securities
Contracts, shall be approved by an appropriate principal of
Broker-Dealer as to suitability; when completed, shall, before
the Contract is issued, be forwarded promptly, but in no case
later than the end of the next business day following receipt
by General Agent, Broker-Dealer or an Agent, to Manulife USA
or as otherwise provided in Manulife USA's administrative
procedures; shall be sent to Manulife USA at the address shown
on the application or such other address as Manulife USA may
specify from time to time; and shall be accompanied by any
premium payment received with such applications, without any
deduction or offset for any reason, including but not limited
to compensation payable to General Agent or Broker-Dealer,
unless Manulife USA or ManEquity and General Agent or
Broker-Dealer have previously agreed to an arrangement for
deduction or offset. Checks or money orders for the payment of
premiums shall be drawn to the order of "The Manufacturers
Life Insurance Company (U.S.A.)", or such other name as
Manulife USA shall authorize from time to time. General Agent
and Broker-Dealer do not have authority to deposit or endorse
checks payable to Manulife USA without the prior written
approval of Manulife USA. Manulife USA has the right in its
sole discretion to reject any application for a Contract and
return any premium payment made in connection with the sale of
the Contract.
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Manulife Financial and the block design are registered service marks and
trademarks of The Manufacturers Life Insurance Company and are used by it and
its affiliates including Manulife Financial Corporation.
AG1010US (08/2001)
4
c. Manulife USA may require that any medical examination made in
conjunction with an application for a Contract be made by a medical examiner
approved by Manulife USA and shall pay only those fees in connection with
medical examinations that have been expressly authorized by it.
d. Contracts issued on accepted applications shall be delivered to the
contract owners according to administrative procedures established by Manulife
USA.
e. General Agent and Broker-Dealer shall not, directly or indirectly,
expend or contract for the expenditure of any funds of Manulife USA or
ManEquity. Manulife USA and ManEquity shall not be obligated to pay any expense
incurred by General Agent or Broker-Dealer in the performance of this Agreement,
unless otherwise specifically provided for in this Agreement or agreed to in
advance in writing by Manulife USA or ManEquity.
f. General Agent and Broker-Dealer are not authorized: to incur
indebtedness or make contracts on behalf of Manulife USA or ManEquity; to alter
or amend any of the provisions of the Contracts or the forms prescribed by
Manulife USA or ManEquity; to discharge, waive any forfeitures under or extend
the time for making payments under the Contracts; to pay any premium or other
payment on behalf of a Contract applicant; to enter into any court or regulatory
proceeding in the name of or on behalf of Manulife USA or ManEquity; or to bind
Manulife USA or ManEquity in any way not specifically authorized in writing by
the party to be bound.
g. General Agent and Broker-Dealer shall not induce any employee or
agent of Manulife USA to terminate that relationship, persuade owners of
insurance or annuity contracts issued by Manulife USA to discontinue their
contracts or otherwise do anything prejudicial to the interests of Manulife USA
or the owners of contracts issued by it.
h. General Agent and Broker-Dealer agree to comply with, and to cause
the Agents to comply with, the administrative procedures of Manulife USA
relating to the Contracts and the policies and procedures adopted by Manulife
USA relating to privacy, agent conduct and similar matters and identified in the
Policies and Procedures Schedule which is Exhibit C to this Agreement, to the
extent such policies and procedures are applicable to the offer, sale and
servicing of the Contracts, as those administrative procedures and other
policies and procedures are now in effect or may be amended or established in
the future by Manulife USA in its sole discretion and communicated to General
Agent and Broker-Dealer, as appropriate. General Agent and Broker-Dealer
acknowledge receipt of those policies of Manulife USA set forth in the Policies
and Procedures Schedule.
i. Each of General Agent and Broker-Dealer agrees to carry out its
activities and obligations under this Agreement, and to cause each Agent for
which it has primary supervisory responsibility to carry out the Agent's
activities and obligations in connection with the offer, sale and servicing of
the Contracts, in continuous compliance with applicable laws, rules and
regulations of applicable federal and state regulatory authorities (including
the rules of the NASD), including those governing securities and
insurance-related activities or transactions, and to notify Manulife USA and
ManEquity immediately in writing if it or any such Agent fails to comply with
any of those laws and regulations.
j. Broker-Dealer shall execute any electronic or telephone orders only
in accordance with the current prospectus applicable to the Securities Contracts
and agrees that, in consideration for electronic and telephone transfer
privileges, Manulife USA will not be liable for any loss incurred as a result of
acting upon electronic or telephone instructions containing unauthorized,
incorrect or incomplete information received from Broker-Dealer or its
representatives.
5. COMPENSATION
a. Manulife USA shall pay General Agent compensation for the sale of
Insurance Contracts and, on behalf of ManEquity, shall pay Broker-Dealer for the
sale of Securities Contracts as set forth in the Contracts Schedule. Unless
otherwise provided in the Contracts Schedule, Manulife USA will make these
payments within 15 days after the end of the calendar month in which it accepts
the premiums and purchase payments on which the payments are based.
Notwithstanding any other provision of this Agreement, Broker-Dealer shall
return to Manulife USA all compensation paid to it with respect to a Securities
Contract if the Securities Contract is tendered for redemption within seven
business days after Manulife USA's acceptance of the application for the
Securities Contract.
b. Except as otherwise set forth in this Agreement including the
Contracts Schedule, General Agent shall be exclusively responsible for setting
the compensation of and promptly paying Agents for sales of Insurance Contracts,
and Broker-Dealer shall be exclusively responsible for setting the compensation
of and promptly paying Agents for sales of Securities Contracts.
6. ASSOCIATED INSURANCE AGENCY
a. If they are not the same person, General Agent and Broker-Dealer
represent and warrant that they are in compliance with the terms and conditions
of no-action letters issued by the staff of the SEC with respect to
non-registration as a broker-dealer of an insurance agency associated with a
registered broker-dealer. If Broker-Dealer has entered into an agreement with
one or more insurance agencies other than General Agent (each, an "Associated
Agency") for purposes of selling Securities Contracts in those states in which
neither Broker-Dealer nor General Agent can obtain an insurance license
necessary to sell the Contracts, Broker-Dealer represents and warrants that it
and each such Associated Agency are in compliance with the terms and conditions
of no-action letters
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Manulife Financial and the block design are registered service marks and
trademarks of The Manufacturers Life Insurance Company and are used by it and
its affiliates including Manulife Financial Corporation.
AG1010US (08/2001)
5
issued by the staff of the SEC with respect to non-registration as a
broker-dealer of an insurance agency associated with a registered broker-dealer.
The Broker-Dealer will supervise agents of an Associated Agency in the same
manner as it is required to supervise Agents under this Agreement, as
applicable. General Agent and Broker-Dealer shall notify Manulife USA and
ManEquity immediately in writing if General Agent, Broker-Dealer or any
Associated Agency fails to comply with any such terms and conditions and shall
take such measures as may be necessary to comply with any such terms and
conditions.
b. In reliance on such representations and warranties, Manulife USA, on
behalf of ManEquity, agrees to pay any compensation otherwise due to
Broker-Dealer for sales of Securities Contracts to General Agent or Associated
Agencies as authorized in writing by Broker-Dealer.
c. Broker-Dealer shall have the same obligations under this Agreement
with respect to sales of Securities Contracts for which compensation is paid to
General Agent or an Associated Agency as it has for sales of Securities
Contracts for which it receives compensation directly from ManEquity or Manulife
USA. In addition, Broker-Dealer shall insure that compensation paid to General
Agent or an Associated Agency is distributed only to duly licensed Securities
Agents.
7. REPRESENTATIONS AND WARRANTIES
a. Each of Manulife USA, ManEquity, Broker-Dealer and General Agent
represents to the others that it and its officers signing below have full power
and authority to enter into this Agreement, that this Agreement has been duly
and validly executed by it and that this Agreement, assuming due and valid
execution by the other parties, constitutes a legal, valid and binding
agreement.
b. General Agent represents and warrants to Manulife USA and ManEquity
that General Agent is, and at all times when performing its functions and
fulfilling its obligations under this Agreement will be, a properly licensed
insurance agency in each jurisdiction in which such licensing is required for
the sale of the Contracts.
c. Broker-Dealer represents and warrants to Manulife USA and ManEquity
that Broker-Dealer is, and at all times when performing its functions and
fulfilling its obligations under this Agreement will be, registered as a
broker-dealer with the SEC under the Securities Exchange Act of 1934 (the "1934
Act") and under the securities laws of each state in which such registration is
required for the sale of the Securities Contracts and a member of the NASD.
Broker-Dealer will notify ManEquity promptly in writing if any such registration
or membership is terminated or suspended.
d. ManEquity represents and warrants to Broker-Dealer that ManEquity
is, and at all times when performing its functions and fulfilling its
obligations under this Agreement will be, registered as a broker-dealer with the
SEC under the 1934 Act and under the securities laws of each state in which such
registration is required for underwriting the Securities Contracts and a member
of the NASD.
e. Manulife USA represents and warrants to General Agent and
Broker-Dealer that the Securities Contracts, including any variable account(s)
supporting the Securities Contracts, shall comply in all material respects with
applicable registration and other requirements of the 1933 Act and the
Investment Company Act of 1940 (the "1940 Act"), and the rules and regulations
thereunder, including the terms of any order of the SEC with respect thereto.
f. Manulife USA represents and warrants to General Agent and
Broker-Dealer that the prospectuses included in Manulife USA's registration
statements for the Contracts, and in post-effective amendments thereto, and any
supplements thereto, as filed or to be filed with the SEC, as of their
respective effective dates, contain or will contain in all material respects all
statements and information which are required to be contained therein by the
1933 Act.
8. SALES LITERATURE, ADVERTISEMENTS AND OTHER PROMOTION MATERIAL
a. General Agent and Broker-Dealer shall not use, and shall cause the
Agents not to use, any sales literature, advertisements or other promotional
material ("Sales Material") in connection with the offer and sale of the
Contracts unless the Sales Material has been approved in writing prior to use by
Manulife USA, in the case of Insurance Contracts, or ManEquity, in the case of
Securities Contracts. For purposes of this Agreement, Sales Material shall
include but not be limited to:
i. material published, or designed for use in, a
newspaper, magazine or other periodical, radio,
television, telephone or tape recording, video-tape
display, signs or billboards, motion pictures,
telephone directories (other than routine listings),
electronic or other public media, or direct mail;
ii. descriptive literature and sales aids of all kinds,
including, but not limited to, circulars, leaflets,
booklets, marketing guides, seminar material,
audiovisual material, computer print-outs,
depictions, illustrations and form letters;
iii. material used for training and education which is
designed to be used or is used to induce the public
to purchase or retain a Contract; and
iv. prepared sales talks and other presentations and
material prepared for use with prospective purchasers
of the Contracts or with the public generally.
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Manulife Financial and the block design are registered service marks and
trademarks of The Manufacturers Life Insurance Company and are used by it and
its affiliates including Manulife Financial Corporation.
AG1010US (08/2001)
6
b. Manulife USA or ManEquity will provide Broker-Dealer, without
charge, with as many copies of the prospectuses and statements of additional
information for the Securities Contracts and the underlying investment funds as
may be reasonably requested ("Registration Material"). Upon receipt of updated
Registration Material, Broker-Dealer will promptly discard or destroy all copies
of Registration Material previously provided to it, except as needed to maintain
proper records.
c. Upon notice to General Agent or Broker-Dealer, Manulife USA or
ManEquity may terminate at any time and for any reason the use of any Sales
Material previously approved by it or of any Registration Material, and General
Agent and Broker-Dealer shall promptly comply with any such request and shall
not use, or permit an Agent to use, such material thereafter.
d. General Agent and Broker-Dealer are not authorized, and may not
authorize anyone else, to give any information or to make any representation
concerning Manulife USA, the Contracts, the separate accounts of Manulife USA or
the underlying investment funds for the Contracts other than those contained in
the current Registration Material and Sales Material authorized for use by
Manulife USA or ManEquity. Broker-Dealer, General Agent and Agents may not
modify or represent that they are authorized to modify any such material.
e. General Agent shall be responsible for all communications by Agents
with prospective purchasers of, and with the public generally in connection
with, Insurance Contracts. Broker-Dealer shall be responsible for all
communications by Securities Agents with prospective purchasers of, and with the
public generally in connection with, Securities Contracts.
9. GROUP ANNUITY CONTRACTS
For purposes of this Agreement, a group annuity contract which has not
been registered under the 1933 Act and which is to be issued in connection with
a stock bonus, pension, or profit-sharing plan which meets the requirements for
qualification under section 401 of the Internal Revenue Code (or in connection
with another kind of plan specified in Section 3(a)(2) of the 1933 Act) ("Exempt
Group Contract") shall be deemed to be an Insurance Contract, but a sale of an
Exempt Group Contract by a Securities Agent shall be subject to any applicable
NASD rules. Broker-Dealer shall supervise and maintain records with respect to
such transactions as may be required by any applicable NASD rules
10. FIDELITY BOND AND OTHER LIABILITY COVERAGE
Each of General Agent and Broker-Dealer represents that it and its
directors, officers and employees and the Insurance Agents, in the case of
General Agent, and the Securities Agents, in the case of Broker-Dealer, are and
shall be covered by a blanket fidelity bond, issued by a reputable bonding
company, and other errors and omissions or liability insurance, acceptable to
Manulife USA ("Liability Coverage"). Each of General Agent and Broker-Dealer
shall maintain its Liability Coverage at its expense. Liability Coverage shall
be in a form, type and amount and issued by a bonding company or other insurance
company satisfactory to Manulife USA. Any fidelity bond maintained by
Broker-Dealer which meets the requirements of the NASD Conduct Rules applicable
to fidelity bonds shall be deemed to be satisfactory. Manulife USA may require
evidence, satisfactory to it, that such coverage is in force, and General Agent
and Broker-Dealer shall give prompt written notice to Manulife USA of any
cancellation or change of coverage. Each of General Agent and Broker-Dealer
assigns any proceeds received from the Liability Coverage to Manulife USA to the
extent of its loss, and to ManEquity to the extent of its loss, due to
activities covered by the Liability Coverage and agrees to pay promptly any
deficiency whether due to a deductible or otherwise.
11. COMPLAINTS, INVESTIGATIONS AND PROCEEDINGS
Each of General Agent and Broker-Dealer shall promptly notify Manulife
USA and ManEquity if it receives notice of any customer complaint or of any
threatened or pending regulatory investigation or proceeding, civil action or
arbitration (a "Proceeding") involving the Contracts. Manulife USA or ManEquity
will promptly notify General Agent or Broker-Dealer if it receives notice of any
customer complaint or of any Proceeding involving General Agent or Broker-Dealer
and the Contracts. Each party shall cooperate with the other parties in
investigating and responding to any such complaint or Proceeding, and in any
settlement or trial of any actions arising out of the conduct of business under
this Agreement. No response by General Agent or Broker-Dealer to an individual
customer complaint involving a Contract will be sent until it has been approved
by Manulife USA or ManEquity or dealt with otherwise in accordance with Manulife
USA's administrative procedures.
12. INDEMNIFICATION
a. General Agent and Broker Dealer, jointly and severally, indemnify
and hold harmless Manulife USA, ManEquity, and their respective affiliates,
officers, directors, employees and agents against any and all loss, claim,
damage, liability or expense (including reasonable attorneys' fees), joint or
several, insofar as such loss, claim, damage, liability or expense arises out of
or is based upon any breach of this Agreement, any applicable law or regulation,
or any applicable rule of any self-regulatory organization, by General Agent,
Broker-Dealer or any of the Agents. This indemnification will be in addition to
any liability which the General Agent and Broker-Dealer may otherwise have.
5
Manulife Financial and the block design are registered service marks and
trademarks of The Manufacturers Life Insurance Company and are used by it and
its affiliates including Manulife Financial Corporation.
AG1010US (08/2001)
7
b. Manulife USA and ManEquity, jointly and severally, indemnify and
hold harmless General Agent, Broker-Dealer and their respective affiliates,
officers, directors, employees and Agents against any and all loss, claim,
damage, liability or expense (including reasonable attorneys' fees), joint or
several, insofar as such loss, claim, damage, liability or expense arises out of
or is based upon any breach of this Agreement, any applicable law or regulation,
or any applicable rule of any self-regulatory organization, by Manulife USA or
ManEquity. This indemnification will be in addition to any liability which
Manulife USA and ManEquity may otherwise have.
13. TERMINATION
a. Any party may terminate this Agreement in its discretion without
cause upon thirty (30) days written notice to the other parties.
b. Manulife USA or ManEquity may terminate this Agreement effective
with the mailing of a notice of termination to General Agent or Broker-Dealer if
the reasons for the termination include (i) conversion, fraud, embezzlement or
similar activity, (ii) failure to maintain Liability Coverage as required by
Section 10 or (iii) a rebate of, offer to rebate or withholding of any payment
due on a Contract by General Agent or Broker-Dealer.
c. This Agreement will terminate automatically without notice,
effective as of the immediately preceding date, if: General Agent or
Broker-Dealer ceases to have the requisite registrations and regulatory licenses
(but only as to the jurisdictions and Contracts affected by the absence of such
registrations and licenses); applicable laws or regulations otherwise prohibit
General Agent or Broker-Dealer from continuing to market the Contracts; or
General Agent or Broker-Dealer files for bankruptcy or financial or corporate
reorganization under federal or state insolvency law.
d. No provision of this Agreement shall continue in force after any
termination, other than Sections 11, 12, 14, 15, 18, 19, 20 and 21, and the
Contracts Schedule.
14. CONFIDENTIALITY
Each party to this Agreement shall maintain the confidentiality of any
customer list and any material designated as confidential and/or proprietary by
another party ("Confidential Information"), and shall not use or disclose such
information without the prior written consent of the party designating such
material as confidential and/or proprietary. Each party to this Agreement shall
take reasonable steps to protect such Confidential Information, applying at
least the same security measures and level of care as it employs to protect its
own Confidential Information. If any party to this Agreement is compelled by
applicable law to disclose any Confidential Information, it shall promptly
notify the party designating such material as confidential and/or proprietary in
writing. The General Agent and Broker-Dealer shall cause Agents to comply with
this provision.
15. AMENDMENTS
This Agreement may be amended in a writing signed by all the parties.
If Manulife USA and ManEquity send written notice of a proposed amendment to
this Agreement to General Agent and Broker-Dealer, General Agent and
Broker-Dealer shall be deemed to have agreed to the amendment if either submits
an application for a Contract on or after the fifth business day after the date
on which the notice was sent. Manulife USA may also unilaterally suspend
distribution of any of the Contracts and amend the Schedules to this Agreement
in any and all respects, from time to time in its sole discretion, with prior or
concurrent written notice to General Agent and Broker-Dealer. Any change in
compensation shall apply to compensation due on applications received by
Manulife USA after the effective date of the notice. Manulife USA may also amend
the Contracts from time to time, in its sole discretion, and nothing in this
Agreement shall be deemed to affect its right to so amend the Contracts.
16. BOOKS AND RECORDS
a. General Agent and Broker-Dealer shall maintain such books and
records concerning the activities of the Agents as may be required under
applicable insurance and securities laws and regulations and the rules of the
NASD, and as may be reasonably required by Manulife USA or ManEquity to reflect
adequately the Contracts business processed through General Agent or
Broker-Dealer. General Agent and Broker-Dealer shall maintain such books and
records at their respective principal places of business in good and legible
condition for a period of six calendar years following the year in which this
Agreement is terminated (the "Post-Termination Period") and shall make them
available during normal business hours to Manulife USA or ManEquity from time to
time while this Agreement is in effect and during the Post-Termination Period
upon 10 days' written request.
b. The parties shall promptly furnish each other any reports and
information that another party may reasonably request for the purpose of meeting
its reporting and recordkeeping requirements under the insurance laws of any
state or under any applicable federal or state securities laws or regulations or
NASD rules.
6
Manulife Financial and the block design are registered service marks and
trademarks of The Manufacturers Life Insurance Company and are used by it and
its affiliates including Manulife Financial Corporation.
AG1010US (08/2001)
8
17. NOTICES
a. All notices under this Agreement shall be given in writing and sent
to the address of a party shown on the signature page or to such other address
as the party may designate in writing.
b. Each of General Agent and Broker-Dealer shall provide written notice
to Manulife USA no less than thirty days prior to the closing date of its
proposed merger into or consolidation with another entity, a sale of
substantially all its assets or a sale, transfer or assignment of a controlling
interest in it.
18. EFFECTIVE DATE
This Agreement supersedes in its entirety any other effective selling
agreement between the General Agent or Broker-Dealer and Manulife USA, The
Manufacturers Life Insurance Company of America or The Manufacturers Life
Insurance Company of North America. If this Agreement is executed by General
Agent and Broker-Dealer and delivered to Manulife USA, (i) prior to January 1,
2002, it shall, when executed, become effective as of January 1, 2002 or (ii) on
or after January 1, 2002, it shall, when executed, become effective as of its
date of delivery to Manulife USA.
19. REGULATIONS
All parties agree to observe and comply with all existing laws, rules
and regulations of all applicable local, state or federal regulatory authorities
(including the rules of the NASD), and with all existing rules and regulations
of any self-regulatory organization, and to observe and comply with those laws,
rules and regulations which may be enacted, adopted or promulgated during the
term of this Agreement, which relate to the business contemplated hereby in any
jurisdiction in which the business described herein is to be transacted.
20. OTHER
This Agreement contains the entire understanding of the parties with
respect to the subject matter hereof, supersedes all prior agreements and
understandings among the parties regarding the subject matter, may be executed
in two or more counterparts which together shall constitute a single agreement,
may not be assigned by any party without the written consent of the other
parties (except that it may be assigned by Manulife USA to a successor in
connection with a merger, consolidation or sale of all or substantially all of
the assets of Manulife USA, and may be assigned by ManEquity to an affiliate or
successor, including without limitation Manulife Financial Securities LLC) and
shall inure to the benefit of and to be binding upon the parties and their
respective successors and assigns. Forbearance by a party to require performance
of any provision hereof shall not constitute or be deemed a waiver by that party
of such provision or of the right thereafter to enforce the same, and no waiver
by a party of any breach or default hereunder shall constitute or be deemed a
waiver of any subsequent breach or default, whether of the same or similar
nature or of any other nature, or a waiver of the provision or provisions with
respect to which such breach or default occurred. This Agreement shall be
governed and construed in all respects by the laws of the State of Michigan
without reference to the principles of conflict or choice of law thereof.
21. ARBITRATION
Any and all disputes under this Agreement shall be settled by
arbitration in Massachusetts under the then existing rules of the American
Arbitration Association and judgment may be entered upon the award in any court
of competent jurisdiction. The determination of the arbitrators shall be final
and binding on all parties. The costs of arbitration shall be borne equally by
the parties to the arbitration, provided however, that the arbitrators may
assess one party more heavily than the other for these costs upon a finding that
such party did not make a good faith effort to settle the dispute informally
when it first arose.
7
Manulife Financial and the block design are registered service marks and
trademarks of The Manufacturers Life Insurance Company and are used by it and
its affiliates including Manulife Financial Corporation.
AG1010US (08/2001)
9
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed as of the date set forth below.
GENERAL AGENT BROKER-DEALER
------------------------------------- -------------------------------------
Name Name
------------------------------------- -------------------------------------
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
------------------------------------- -------------------------------------
City, State & Zip City, State & Zip
------------------------------------- -------------------------------------
By: By:
------------------------------------- -------------------------------------
Title: Title:
------------------------------------- -------------------------------------
Date: Date:
THE MANUFACTURERS LIFE INSURANCE COMPANY (U.S.A.) MANEQUITY, INC.
▇.▇. ▇▇▇ ▇▇▇ ▇.▇. ▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇▇▇, ▇▇
▇▇▇▇▇ 14240
Attn: Agency Department Attn: Operations Department
/s/ ▇▇▇▇ ▇▇▇▇▇▇▇ III /s/ ▇▇▇▇ ▇▇▇▇▇▇▇▇
By: By:
▇▇▇▇ ▇▇▇▇▇▇▇ III ▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: President Title: President
8
Manulife Financial and the block design are registered service marks and
trademarks of The Manufacturers Life Insurance Company and are used by it and
its affiliates including Manulife Financial Corporation.
AG1010US (08/2001)
10
Exhibit A
Contracts, Commissions and Fees Schedule
General Provisions
Compensation. Unless otherwise provided in this Contracts Schedule,
commissions will be paid as a percentage of premiums or purchase payments
(collectively, "Payments") received in cash or other legal tender and accepted
by Manulife USA on applications obtained by Agents. Such Payments will be
payable in respect of the sale of such Contracts, in such amounts, and upon such
terms as are set forth in the applicable commission schedules together with any
accompanying schedules relating to the Payments, (the "Commission Schedules"),
established by Manulife USA and ManEquity and covering each Contract, as are in
effect from time to time, to which such Payments relate. Manulife USA and
ManEquity expressly reserve the right to transfer future compensation on a
Contract to another General Agent or Broker-Dealer if the owner of the Contract
so requests. Upon termination of the Agreement, General Agent and Broker-Dealer
shall receive no further compensation, except for compensation for all Payments
which are in process at the time of termination of the Agreement or are received
subsequently on Contracts in force at the time of termination of the Agreement,
unless otherwise provided in an applicable Commission Schedule. Notwithstanding
the foregoing, no Payments will be made with respect to an increase in the face
amount of a Contract when the Agreement is terminated prior to such increase,
and when the Agreement is terminated, no Payments with respect to any Securities
Contracts shall be made after the Broker-Dealer ceases to be properly licensed
to sell Securities Contracts. General Agent and Broker-Dealer shall continue to
be liable for any chargebacks pursuant to the provisions of this Contracts
Schedule, and for any other amounts advanced by or otherwise due Manulife USA or
ManEquity under the Agreement.
Joint Business. Any Contract sold by General Agent or Broker-Dealer in
conjunction with any other person authorized to sell the Contracts shall be
considered as joint business and, unless otherwise agreed to by Manulife USA,
the amount of the compensation due on the Payments accepted under that Contract
shall be apportioned equally among each participant in the sale. General Agent
or Broker-Dealer shall provide Manulife USA with written notice of any such
joint business and of the existence of any agreement among participants for
unequal apportionment of compensation.
Prohibition Against Rebates. General Agent and Broker-Dealer shall not,
and shall cause the Agents not to, rebate, offer to rebate or withhold any part
of any payments due on the Contracts. If General Agent, Broker-Dealer or any
Agent shall at any time induce or endeavor to induce any owner of any Contract
to discontinue payments or to relinquish any such Contract, except under
circumstances where there is reasonable grounds for believing the Contract is
not suitable for such person, Manulife USA shall forthwith cease paying any and
all compensation that would otherwise be due General Agent or Broker-Dealer
under this Agreement.
Right of Set Off. Each of General Agent and Broker-Dealer hereby
authorizes Manulife USA to set off its liabilities to Manulife USA and ManEquity
against any and all amounts otherwise payable to General Agent or Broker-Dealer,
including amounts payable under the Agreement or under any other agreement
pursuant to which General Agent or Broker-Dealer receive compensation directly
or indirectly from Manulife USA.
Each of General Agent and Broker-Dealer shall be liable for the portion
of any debit balance equal to advances on unearned compensation which appears in
their respective Advance Accounts. Such portion of the debit balance shall be
payable by General Agent or Broker-Dealer, as applicable, upon demand by
Manulife USA. At the option of Manulife USA, interest at the maximum rate
permissible by state law will accrue on such portion of the debit balance from
the time a debit balance occurs in such account.
Paying Agent for Insurance Contracts. At the request of General Agent,
Manulife USA, at its discretion, may agree to act as General Agent's paying
agent and make payments of compensation directly to such Insurance Agents and
such other appropriate parties who are not employees of General Agent but are
appointed with Manulife USA and are entitled to compensation from General Agent
in connection with the sale of those Insurance Contracts that are not variable
annuity contracts or variable life insurance policies, as General Agent may
designate from time to time.
9
Manulife Financial and the block design are registered service marks and
trademarks of The Manufacturers Life Insurance Company and are used by it and
its affiliates including Manulife Financial Corporation.
AG1010US (08/2001)
11
Exhibit B
General Letter of Recommendation
General Agent hereby certifies to Manulife USA that all of the
following requirements will be fulfilled in conjunction with the submission by
General Agent of licensing/appointment papers for all applicants to become
Agents ("Applicants"). General Agent will, upon request, forward proof of
compliance with same to Manulife USA in a timely manner.
1. We have made a thorough and diligent inquiry and investigation
relative to each Applicant's identity, residence, business reputation and
experience and declare that each Applicant is personally known to us, has been
examined by us, is known to have a good business reputation, is reliable, is
financially responsible and is worthy of a license and appointment as an Agent.
Each individual is trustworthy, competent and qualified to act as an agent for
Manulife USA and hold himself out in good faith to the general public. We vouch
for each Applicant.
2. We have on file a Form ▇-▇▇▇, ▇-▇▇▇ or U-4 which was completed by
each Applicant. With respect to each Applicant to become a Securities Agent, we
have fulfilled all the necessary investigative requirements for the registration
of each such Applicant as a registered representative through our NASD member
firm, and each such Applicant is presently registered as an NASD registered
representative. The above information in our files indicates no fact or
condition which would disqualify the Applicant from receiving a license, and all
the findings of all investigative information is favorable.
3. We certify that all educational requirements have been met for the
specific state in which each Applicant is requesting a license and that all such
persons have fulfilled the appropriate examination, education and training
requirements.
4. If the Applicant is required to submit his or her picture, signature
and securities registration in the state in which he or she is applying for a
license, we certify that those items forwarded to Manulife USA are those of the
Applicant and the securities registration is a true copy of the original.
5. We hereby warrant that the Applicant is not applying for a license
with Manulife USA in order to place insurance chiefly or solely on his or her
life or property or on the lives, property or liability of his or her relatives
or associates.
6. We certify that each Applicant will receive close and adequate
supervision, and that we will make inspection when needed of any or all risks
written by these Applicants, to the end that the insurance interest of the
public will be properly protected.
7. We will not permit any Applicant to transact insurance as an agent
until duly licensed therefor. No Applicants have been given a contract or
furnished supplies, nor have any Applicants been permitted to write, solicit
business or act as an agent in any capacity, and they will not be so permitted
until the certificate of authority or license applied for is received.
8. We certify that General Agent, Broker-Dealer and Applicant shall
have entered into a written agreement pursuant to which: (a) Applicant is
appointed a Sub-agent of General Agent and a registered representative of
Broker-Dealer; (b) Applicant agrees that his or her selling activities relating
to the Securities Contracts shall be under the supervision and control of
Broker-Dealer and his or her selling activities relating to the Insurance
Contracts shall be under the supervision and control of General Agent; and (c)
that Applicant's right to continue to sell such Contracts is subject to his or
her continued compliance with such agreement and any procedures, rules or
regulations implemented by Broker-Dealer or General Agent.
10
Manulife Financial and the block design are registered service marks and
trademarks of The Manufacturers Life Insurance Company and are used by it and
its affiliates including Manulife Financial Corporation.
AG1010US (08/2001)
12
Exhibit C
Policies and Procedures Schedule
In addition to its administrative procedures, Manulife USA has adopted
the following Codes which contain policies and procedures applicable to the
offer, sale and servicing of the Contracts:
Privacy Code
Agent's Code of Conduct
11
Manulife Financial and the block design are registered service marks and
trademarks of The Manufacturers Life Insurance Company and are used by it and
its affiliates including Manulife Financial Corporation.
AG1010US (08/2001)
13
[MANULIFE FINANCIAL LOGO] General Agent and Broker-Dealer
Selling Agreement Addendum
General Agent Listing
As described in the General Agent and Broker-Dealer Selling Agreement ("the
Agreement") to which this Addendum is attached, the term General Agent includes
the following entities in addition to those listed on the signature page of the
Agreement. This addendum does not need to be signed by General Agent if General
Agent is affiliated by common ownership with Broker Dealer. Please provide the
complete name, address and tax identification number of all General Agents.
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Name of General Agent Tax ID Address Name of Officer Officer Signature
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Manulife Financial and the block design are registered service marks and
trademarks of The Manufacturers Life Insurance Company and are used by it and
its affiliates including Manulife Financial Corporation.
AG1924US (08/2001)