EXHIBIT A.(3)(b)
Variable Contract Supplement -- General Agent
(a) General. This supplement is a part of your General Agent's Contract to which
it is attached and is subject to all its terms, definitions and conditions. This
supplement describes both the compensation we will provide on your variable
contract business and your responsibilities with respect to the solicitation,
sale or distribution of these contracts for us.
(b) Definitions. Whenever we use the following words this is what we mean:
Personal Variable Annuity Business. All variable annuities, which are
registered, contain identifiable sales charges and have contract values varying
with the investments in a separate account, which we issue on applications you
obtain. This does not include group or fixed annuities.
Personal Variable Adjustable Life Business. The Variable Adjustable Life and any
other Variable Adjustable Life insurance policies which we may issue on
applications you obtain. This does not include group or fixed annuities.
Personal Annuitization Business. The election of an annuity payment option
which you initiate for a deferred annuity (except for Policy Form 87-9154).
Agency Variable Annuity Business. All variable annuities which are registered,
contain identifiable sales charges and have contract values varying with the
investments in a separate account, which we issue on applications you or your
agents obtain. This does not include group or fixed annuities.
Agency Variable Adjustable Life Business. Variable Adjustable Life insurance
policies which we may issue on applications you and your agents obtain. This
does not include group or fixed annuities.
Agency Annuitization Business. The election of any annuity payment option which
you or one of your agents initiate for a deferred annuity (except for Policy
Form 87-9154).
Earned Premium. Money which we have received in our home office and applied to
pay the premiums due on variable contract business.
First-Year Premiums. Premiums due on a policy during the first policy year.
First-Year Commissions. Commissions on earned first-year premiums.
Production Bonus. An amount credited on first-year premiums paid on your Agency
Variable Annuity and Agency Variable Adjustable Life Business.
Renewal Premium. Premiums due on a policy after the first policy year.
Renewal Commissions. Commissions on earned renewal premiums during the second
through the tenth policy year.
Trailing Commissions. Commissions on Qualifying Accumulation Values at the end
of each calendar quarter.
Quality Bonus. An amount credited on each renewal premium paid on your personal
and agency Variable Adjustable Life business in the second and third policy
years.
Service Fees. The amount credited on each renewal premium paid on your Variable
Adjustable Life business and amount credited on each renewal premium paid on
Variable Annuity business after the tenth policy year.
Variable Contracts. Personal and agency variable annuity business and personal
and agency variable adjustable life business.
(c) Licenses. You will do all things necessary to get, and to keep in good
standing, all licenses which you will need to solicit and sell variable
contracts as a life insurance salesman for us in the jurisdictions in which you
do business.
(d) Broker-Dealer. You will do all things necessary to get, and to keep in good
standing, all licenses which you will need to solicit and sell variable
contracts for us and which are required because of your status as a registered
representative of the broker-dealer authorized to distribute the variable
contracts as our agent. You will also contract with the broker-dealer, such
contract to govern your conduct and undertakings with respect to the sale of our
variable contracts.
(e) This Agreement. For all purposes under this supplement, we will consider the
variable contracts to be our products.
(f) Commissions on variable contracts.
(1) First-Year Commissions.
Commissions are a percentage of earned first-year premiums on your
personal business.
Kind of Policy Rate of Commission
-------------- ------------------
*Personal Variable
Adjustable Life Business 50%
Personal Variable Annuity Business
(Forms 84-9091 and 84-9092) 3%
*Target Premium Definition -- 50% first-year commission rate
applies to premium up to whole life plan of insurance. Premiums in
excess will receive a 4% first-year commission rate.
First-year commissions are vested and will be credited to you as they
become due.
(2) Renewal Commissions.
Renewal commissions are percentages of earned renewal premiums during the
second through tenth policy years on your personal business.
Rate of Commission
------------------
Second Policy Year
Kind of Policy Through Tenth Policy Year
-------------- -------------------------
Personal Variable Adjustable 4%
Life Business
Personal Variable Annuity Business
(Forms 84-9091 and 84-9092) 3%
Renewal commissions will be vested as described in Section 7(d) of the
General Agent's contract.
(3) Trailing Commissions on Personal Variable Annuity Business
(i) MultiOption Annuities (Policy Forms 84-9091 and 84-9092)
Trailing commissions are payable in an amount equal to .03125% of
Qualifying Accumulation Values at the end of each calendar quarter
(.125% annually); provided, that such trailing commissions will not
be paid unless the aggregate of all Qualifying Accumulation Values,
as of the end of the quarter for which such trailing commissions are
determined, is at least:
Aggregate Value of For Calendar Quarters
Qualifying Accumulation Values Ending In
------------------------------ ---------------------
$ 60,000 1993
70,000 1994
80,000 1995
90,000 1996
100,000 1997 and later
"Qualifying Accumulation Values" means, with respect to each
MultiOption annuity contract included in your Personal Variable
Annuity Business, all separate account accumulation values held under
such contract; provided, that the separate account accumulation
values held under any contract shall not be Qualifying Accumulation
Values unless such separate account accumulation values are at least:
Single Premium Contracts
------------------------
$10,000
Flexible Payment Contracts
--------------------------
$15,000 in contract years 1-5
$25,000 in contract years 6-10
$35,000 in contract years 11 and later
Trailing commissions will be paid during the month following the end
of each quarter. No trailing commissions will be paid after your
General Agency relationship has been terminated.
(ii) MegAnnuity (Policy Form 87-9154)
Trailing commissions are payable in an amount equal to .05% of
accumulation values in excess of $5 million, as of the end of each
calendar quarter (.20% annually), held under MegAnnuity contracts
included in your agents' Variable Annuity Business. Your margin is
50% of those trailing commissions.
Trailing commissions will be paid during the month following the end
of each quarter. No trailing commissions will be paid after your
General Agency relationship has been terminated.
(g) Commissions on Personal Annuitization Business. We agree to credit to you a
one-time commission on your personal annuitization business if the values have
been held by us in a deferred annuity for at least five years. If those values
have been held by us in a deferred annuity for more than five but less than ten
years, we will credit to you 1.5% of those values. If the values have been held
by us in a deferred annuity for more than ten years, we will credit to you an
amount equal to 3% of those values.
(h) Margins and Expense Allowance on Variable Contracts. We agree to credit you
with margins and an expense allowance on certain of your agency Variable Annuity
(except for Policy Form 87-9154) and all Variable Adjustable Life insurance
business.
For all Variable Adjustable Life business written by you and your agents, we
will calculate the first-year margins according to the schedule in the Contract
Update. For Variable Annuity Contracts written by you and your agents, we will
credit to you first-year margins in an amount equal to 50% of all earned first-
year commissions.
On Variable Adjustable Life business, on the second through the tenth policy
years, we will credit to you renewal margins in an amount equal to 1 1/2% and an
expense allowance equal to 1 1/2% of the earned renewal premiums credited to
your agency. On Variable Annuity business we will credit to you as renewal
margins an amount equal to 50% of the earned renewal commissions credited to
your agency.
First-year and renewal margins are vested and will be credited to you as they
become due. The vesting of renewal margins will be as stated in Section 8 of the
General Agent's Contract; however, renewal margins for Flexible Payment Variable
Annuity business will be vested at 25% of those earned renewal commissions. No
expense allowance will be credited after your General Agency relationship has
been terminated.
Trailing margins will be credited to you for each MultiOption annuity contract
(Policy Forms 84-9091 and 84-9092) on which a trailing commission is paid to you
or your agents (the "Trailing Commission Contracts"), in an amount equal to 100%
of such trailing commissions; provided, that such trailing margins will not be
credited unless the aggregate separate account accumulation values held under
the Trailing Commission Contracts, as of the end of the quarter for which such
trailing margins are determined, is at least:
Aggregate Value of For Calendar Quarters
Separate Account Accumulation Values Ending In
------------------------------------ ---------------------
$ 600,000 1993
700,000 1994
800,000 1995
900,000 1996
1,000,000 1997 and later
Trailing margins will also be credited to you for each MegAnnuity contract
(Policy Form 87-9154) on which a trailing commission is paid to you or your
agents in an amount equal to 50% of such trailing commissions.
No trailing margins will be paid after your General Agency relationship has been
terminated.
(i) Margins on Agency Annuitization Business. We agree to credit you with a
one-time margin on your agency annuitization business in an amount equal to 50%
of all commissions paid on your agency annuitization business. They will be
credited to you as long as you or one of your agents is the agent of record.
(j) Commission and Margin Adjustment. We reserve the right to refund any
purchase payments credited to our General Account under a variable contract. If
we do make such a refund, we will charge you with the amount of any commission
or any margin previously paid on the refunded payment. All charges thus made
will be a debt which you owe us and will become a first lien against any and all
amounts due you; we may offset this debt against any amount which we would
otherwise credit to you under the General Agent's contract.
(k) Production Bonus. We will credit you with a production bonus on first-year
earned commissions, which you and your agents earn on Flexible Payment Variable
Annuities (except for Policy Form 87-9154) and Variable Adjustable Life. No
production bonus will be paid on commissions for Single Payment Variable
Annuities, or annuitization business. We will calculate the production bonus
according to the schedule shown in the Contract Update.
(l) Quality Bonus. We will credit you with a quality bonus for each renewal
premium paid on your personal and agency Variable Adjustable Life business in
the second and third policy years. We will calculate the quality bonus according
to the schedule shown in the Contract Update.
(m) Service Fees.
(1) On agency business, we will credit you with a service fee for each
renewal premium paid on your Variable Adjustable Life and Variable
Annuity business (except for
Policy Form 87-9154) for the eleventh and later policy years. The
amount of the service fee payment on Variable Adjustable Life business
is as shown in the Contract Update on your agency business. The amount
of service fee payment on Variable Annuity business is 1.5% of renewal
premiums paid.
(2) On your personal business, we will credit you with a service fee for each
renewal premium paid on your Variable Adjustable Life business for the
second and later policy years. The amount of the service fee payment is
as shown in the Contract Update for life-earned renewal premiums on your
personal business. We will credit you with a service fee for each renewal
premium paid on your Variable Annuity business (except for Policy Form
87-9154) for the eleventh and later years. The amount of service fee
payment is 3% of renewal premiums paid.
(n) All provisions of Sections 6-10 and 12 of the General Agent's contract will
apply where applicable to any compensation payable under this supplement.
(o) Minimum Production Requirements. In determining whether you have satisfied
the minimum production requirements shown in the Contract Update, we will give
you credit for your Variable Annuity business and Variable Adjustable Life
business. The credit will be equal to 100% of commission credited on your
Variable Adjustable Life and Variable Annuity business.
(p) Termination of This Supplement. We reserve the right to modify or terminate
this supplement at any time; however, any such modification or termination will
be made uniformly among all of our agencies of the same class or as required by
law or other competent authority.
(q) Effective Date. This supplement shall become effective as of the date shown
below.
Executed this _____ day of _________________, 19___.
- -------------------------
General Agent's Signature
THE MINNESOTA MUTUAL LIFE INSURANCE COMPANY
By
-----------------------
Authorized Officer
Minnesota Mutual
The Minnesota Mutual Life Insurance Company
400 Robert Street North
St. Paul, MN 55101-2098
F. 36072 Rev. 1/94
Variable Contract Supplement -- Agent
(a) General. This supplement is a part of your Agent's Contract to which it is
attached and is subject to all its terms, definitions and conditions. This
supplement describes both the compensation we will provide on your variable
contract business and your responsibilities with respect to the solicitation,
sale or distribution of these contracts for us.
(b) Definitions. Whenever we use the following words this is what we mean:
Variable Annuity Business. All variable annuities, which are registered,
contain identifiable sales charges and have contract values varying with the
investments in a separate account, which we issue on applications you obtain.
This does not include group or fixed annuities.
Variable Adjustable Life Business. The Variable Adjustable Life insurance
policies which we may issue on applications you obtain. This does not include
group or fixed annuities.
Variable Contracts. Variable annuity business and variable adjustable life
business.
Annuitization Business. The election of an annuity payment option which you
initiate for a deferred annuity (except for Policy Form 87-9154).
Earned Premium and Contributions. Money which we have received in our home
office and applied to pay the premiums due or contributions on Variable contract
business.
First-Year Premiums and Contributions. Premiums due or contributions paid on a
policy during the first policy year.
First-Year Commissions. Commissions on earned first-year premiums or
contributions.
Production Bonus. An amount credited on first-year premiums paid on your
Variable Adjustable Life Business.
Renewal Premiums. A continuous stream of premiums or contributions established
at the time of sale.
Renewal Commissions. Commissions on earned renewal premiums or contributions
during the second through the tenth policy year.
Trailing Commissions. Commissions on Qualifying Accumulation Values at the end
of each calendar quarter.
Quality Bonus. An amount credited on each renewal premium paid on your Variable
Adjustable Life business in the second and third policy years.
Service Fees. The amount credited on each renewal premium paid on your Variable
Adjustable Life business and amount credited on each renewal contribution paid
on Variable Annuity business after the tenth policy year.
(c) Licenses. You will do all things necessary to get, and to keep in good
standing, all licenses which you will need to solicit and sell variable
contracts as a life insurance salesman for us in the jurisdictions in which you
do business.
(d) Broker-Dealer. You will do all things necessary to get, and to keep in good
standing, all licenses which you will need to solicit and sell variable
contracts for us and which are required because of your status as a registered
representative of the broker-dealer authorized to distribute the variable
contracts as our agent. You will also contract with the broker-dealer, such
contract to govern your conduct and undertakings with respect to the sale of our
variable contracts.
(e) This Agreement. For all purposes under this supplement, we will consider the
variable contracts to be our products.
(f) Commissions on variable contracts:
(1) First-Year Commissions.
Commissions are a percentage of earned first-year premiums and
contributions.
Kind of Policy Rate of Commission
-------------- ------------------
*Variable Adjustable
Life Business 50%
Variable Annuity
Business (Forms 92-9283
and 92-9284) 3%
MultiOption Select
Variable Annuity
Business (Form 94-9307)
Contribution Amount Rate of Commissions
------------------- -------------------
$25 - 499,999 3.00%
$500,000 - 749,999 2.75%
$750,000 - 999,999 2.50%
$1,000,000 - 1,499,999 2.25%
$1,500,000 - 1,999,999 2.00%
$2,000,000 - 2,499,999 1.75%
$2,500,000 - 2,999,999 1.50%
$3,000,000 - 3,999,999 1.25%
$400,000,000 - 4,000,000 1.00%
$5,000,000+ MegAnnuity
*Target Premium Definition -- 50% first-year commission rate
applies to premium up to whole life plan of insurance. Premiums
in excess will receive a 4% first-year commission rate.
First-year commissions are vested and will be credited to you as they
become due.
(2) Renewal Commissions.
Renewal commissions are percentages of earned renewal premiums and
contributions during the second through tenth policy year.
Rate of Commissions
-------------------
Second Policy Year
Kind of Policy Through Tenth Policy Year
-------------- -------------------------
Variable Adjustable 4%
Life Business
Variable Annuity
Business (Forms 92-9283
and 92-9284) 3%
MultiOption Select
Variable Annuity
Business (Form 94-9307)
Contribution Amount Rate of Commissions
------------------- -------------------
$25 - 499,999 3.00%
$500,000 - 749,999 2.75%
$750,000 - 999,999 2.50%
$1,000,000 - 1,499,999 2.25%
$1,500,000 - 1,999,999 2.00%
$2,000,000 - 2,499,999 1.75%
$2,500,000 - 2,999,999 1.50%
$3,000,000 - 3,999,999 1.25%
$400,000,000 - 4,000,000 1.00%
$5,000,000+ MegAnnuity
"Renewal commissions will be vested as described in Section 7(d) of the
Agent's contract."
(3) Trailing Commissions on Variable Annuity Business
(i) MultiOption Annuities (Policy Forms 92-9283, 92-9284 and 94-9307)
Trailing commissions are payable in an amount equal to .03125% of
Qualifying Accumulation Values at the end of each calendar quarter
(.125% annually); provided, that such trailing commissions will not
be paid unless the aggregate of all Qualifying Accumulation Values,
as of the end of the quarter for which such trailing commissions are
determined, is at least:
Aggregate Value of For Calendar Quarters
Qualifying Accumulation Values Ending In
------------------------------ ---------------------
$ 70,000 1994
80,000 1995
90,000 1996
100,000 1997 and later
"Qualifying Accumulation Values" means, with respect to each
MultiOption annuity contract included in your Variable Annuity
Business, all separate account accumulation values held under such
contract; provided, that the separate account accumulation values held
under any contract shall not be Qualifying Accumulation Values unless
such separate account accumulation values are at least:
Single Premium Contracts
------------------------
$10,000
Flexible Payment Contracts
--------------------------
$15,000 in contract years 1-5
$25,000 in contract years 6-10
$35,000 in contract years 11 and later
Trailing commissions will be calculated and paid one month following
the end of each quarter. No trailing commissions will be paid after
your Agency relationship has been terminated.
(ii) MegAnnuity (Policy Form 87-9154)
Trailing commissions are payable in an amount equal to .05% of
accumulation values in excess of $5 million, as of the end of each
calendar quarter (.20% annually), held under MegAnnuity contracts
included in your Variable Annuity Business.
Trailing commissions will be calculated and paid one month following
the end of each quarter. No trailing commissions will be paid after
your Agency relationship has been terminated.
(g) Commissions on Annuitization Business. We agree to credit to you commissions
on your annuitization business if the values have been held by us in a deferred
annuity for at least five years. If those values have been held by us in a
deferred annuity for more than five but less than ten years, we will credit to
you 1.5% of those values. If the values have been held by us in a deferred
annuity for more than ten years, we will credit to you an amount equal to 3% of
those values. In calculating this commission, any new contributions made within
the last two years will not be considered.
(h) Commissions Adjustment. We reserve the right to refund any purchase payments
credited to our General Account under a variable contract. If we do make such a
refund, we will charge you with the amount of any commission previously paid on
the refunded payment. All charges thus made will be a debt which you owe us and
will become a first lien against any and all
amount due you; we may offset this debt against any amount which we would
otherwise credit to you under the Agent's contract.
(i) Production Bonus. We will credit you with a production bonus on first-year
earned commissions, which you earn on Variable Adjustable Life. We will
calculate the production bonus according to the schedule shown in the Contract
Update.
(j) Quality Bonus. We will credit you with a quality bonus for each renewal
premium paid on your Variable Adjustable Life business in the second and third
policy years. We will calculate the quality bonus according to the schedule
shown in the Contract Update.
(k) Service Fees. We will credit you with a service fee for each renewal premium
paid on your Variable Adjustable Life business for the second and later policy
years. The amount of the service fee is shown in the Contract Update for life
renewal premiums. We will credit you with a service fee for each renewal
contribution paid on your Variable Annuity business (except for Policy Form
87-9154), for the eleventh and later policy years. The amount of service fee is
3% of the renewal contribution. For MultiOption Select Variable Annuity, the
service fee is paid on the following schedule:
Contribution Amount Rate of Service Fees
------------------- --------------------
$25 - 499,999 3.00%
$500,000 - 749,999 2.75%
$750,000 - 999,999 2.50%
$1,000,000 - 1,499,999 2.25%
$1,500,000 - 1,999,999 2.00%
$2,000,000 - 2,499,999 1.75%
$2,500,000 - 2,999,999 1.50%
$3,000,000 - 3,999,999 1.25%
$400,000,000 - 4,000,000 1.00%
$5,000,000+ MegAnnuity
(l) All provisions of Sections 6-10 of the Agent's contract will apply where
applicable to any compensation payable under this supplement.
(m) Minimum Production Requirements. In determining whether you have satisfied
the minimum production requirements shown in the Contract Update, we will give
you credit for your Variable Annuity business and Variable Adjustable Life
business. The credit will be equal to 100% of commissions credited on your
Variable Adjustable Life and Variable Annuity business.
(n) Termination of this Supplement. We reserve the right to modify or terminate
this supplement at any time; however, any such modification or termination will
be made uniformly among all of our agencies of the same class or as required by
law or other competent authority.
(o) Effective Date. This supplement shall become effective as of the date shown
below.
Executed this _____ day of _________________, 19___
- ------------------------
Agent's Signature
- ------------------------
General Agent's Signature
The Minnesota Mutual Life Insurance Company
By
----------------------
Authorized Officer
Minnesota Mutual
The Minnesota Mutual Life Insurance Company
400 Robert Street North
St. Paul, MN 55101-2098
F. 36071 Rev. 1-95
Schedule A
Schedule of Commission Expenses under
Variable Adjustable Life Insurance Policy
-----------------------------------------
Commissions to registered representative:
50% of gross premium in the first policy
year
6% of the gross premium in policy years two
through ten
2% in policy years thereafter
0% of nonrepeating premiums
The Schedule of Commissions shows the maximum amount of Commissions payable
under the Variable Adjustable Life Insurance Policy for plans of insurance
described as term and whole life insurance plans. The Commissions payable on
premiums received for plans described as greater than whole life plans will
differ form the percentages shown above, as a first year commission will be paid
only on such amounts as may be classified by Minnesota Mutual as a first year
premium, based upon a whole life premium per $1,000 of face amount and a Policy
face amount of $100,000. The premiums received in excess of that amount pay
commissions at a rate of 4 percent.
In addition, MIMLIC Sales Corporation or The Minnesota Mutual Life Insurance
Company will pay, based uniformly on the sales of Variable Adjustable Life
Insurance Policies by registered representatives, credits which allow registered
representatives (Agents) who are responsible for sales of the Policies to attend
conventions and other meetings sponsored by Minnesota Mutual or its affiliates
for the purpose of promoting the sale of insurance and/or investment products
offered by Minnesota Mutual and its affiliates. Such credits may cover the
registered representatives' transportation, hotel accommodations, meals,
registration fees and the like. Minnesota Mutual may also pay registered
representatives additional amounts based upon their production and the
persistency of life insurance and annuity business placed with Minnesota Mutual.