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EXHIBIT 1(3)b
FORM OF SELLING AGREEMENT
Agreement, made this ___________________ day of __________________, 199______,
by and among Glenbrook Life and Annuity Company ("Glenbrook"), an Illinois life
insurance company; Allstate Life Financial Services ("ALFS"), a Delaware
corporation; ______________________ ("Broker-Dealer" or "BD"), a
________________ corporation; and ______________________ ("Associated Insurance
Agency"), a ______________________ corporation.
GLENBROOK LIFE AND ANNUITY COMPANY ALLSTATE LIFE FINANCIAL SERVICES, INC.
By: By:
_______________________________ __________________________________
Title: Title:
____________________________ _______________________________
BROKER DEALER ASSOCIATED INSURANCE AGENCY
__________________________________ _____________________________________
(Name) (Name)
__________________________________ _____________________________________
(Xxxxxx Xxxxxxx) (Xxxxxx Address)
__________________________________ _____________________________________
(City, State, Zip) (City, State, Zip)
By: By:
______________________________ _________________________________
Title: Title:
___________________________ _______________________________
For States:
________________
WHEREAS, Glenbrook issues certain insurance products and group and individual
insurance contracts/policies and certificates participating therein
(collectively, "Contracts") described further in this Agreement and attached
Schedules, some of which may be deemed securities ("Registered Contracts")
under the Securities Act of 1933 ("1933 Act"); and
WHEREAS, Glenbrook has appointed ALFS, a broker/dealer, as the Underwriter of
the Registered Contracts; and
WHEREAS, BD is a broker/dealer engaged in the sale of securities and other
investment products; and
WHEREAS, each Associated Insurance Agency is an insurance agent in the states
noted above; and
WHEREAS, in the event that Associated Insurance Agency and BD are the same
person, the duties, responsibilities and privileges of Associated Insurance
Agency under this Agreement shall be undertaken by BD; and
WHEREAS, Glenbrook and ALFS propose to authorize BD and Associated Insurance
Agency to solicit sales of the Contracts;
NOW THEREFORE, in consideration of the premises and mutual promises contained
herein including the attached Schedule and Exhibits, the parties hereto agree
as follows:
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1. APPOINTMENT AND AUTHORIZATION
ALFS hereby authorizes BD to solicit sales of the Contracts that are described
more specifically in the Commission Schedule(s) attached hereto. Glenbrook
hereby appoints Associated Insurance Agency to solicit sales of the Contracts.
BD and Associated Insurance Agency accept such appointment and authorization,
and each agrees to use its best efforts to find purchasers of the Contracts
acceptable to Glenbrook.
2. REPRESENTATIONS
a. Glenbrook, ALFS, BD and Associated Insurance Agency each represents to one
another that it and the officers signing above have full power and
authority to enter into this Agreement, and that this Agreement has been
duly and validly executed by it and constitutes a legal, valid and binding
agreement.
x. XXXX represents to BD that ALFS is registered as a broker/dealer with the
Securities and Exchange Commission (the "SEC") under the Securities
Exchange Act of 1934 ("1934 Act") and under the state securities laws of
each jurisdiction in which such registration is required for underwriting
the Contracts, and that it is a member of the National Association of
Securities Dealers, Inc. (the "NASD").
c. BD represents to ALFS that BD is, and at all times when performing its
functions and fulfilling it obligations under this Agreement, will be,
registered with the SEC as a broker/ dealer under the 1934 Act and under
the state securities laws of each jurisdiction in which such registration
is required for the sale of the Contracts, and a member of the NASD. BD
will notify ALFS in writing if such registration is terminated or
suspended, and shall take all reasonable actions to reinstate such
registrations.
d. Associated Insurance Agency represents to ALFS and Glenbrook that
Associated Insurance Agency 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.
e. Glenbrook represents to BD that the Registered Contracts, including any
variable separate account(s) supporting such Registered Contracts, shall
comply in all material respects with the registration and other applicable
requirements of the 1933 Act and the Investment Company Act of 1940, and
the rules and regulations thereunder, including the terms of any order of
the SEC with respect thereto.
f. Glenbrook represents to BD and Associated Insurance Agency that the
Contracts it issues have been filed and approved by the state insurance
departments in such jurisdictions where it is authorized to transact
business and such filing and approval are required prior to the issuance
of Contracts therein.
g. Glenbrook represents to BD that the prospectuses included in Glenbrook's
Registration Statement for the Registered 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 and conform or will
conform in all material respects to the requirements thereof.
3. COMPLIANCE WITH REGULATORY REQUIREMENTS
BD shall abide by all rules and regulations of the NASD governing the sale of
the Variable Contracts, and BD and Associated Insurance Agency shall comply
with all applicable state and federal laws and the rules and regulations of
governmental or regulatory agencies affecting or governing the sale of the
Contracts. BD and Associated Insurance Agency shall comply with all applicable
administrative procedures of Glenbrook and ALFS.
4. LICENSING AND/OR APPOINTMENT OF REPRESENTATIVES
a. BD and Associated Insurance Agency are hereby specifically authorized to
designate those registered representatives of BD, or individuals
associated with the Associated Insurance Agency ("Agents"), proposed to be
engaged in solicitation of sales of the Contracts for appointment by
Glenbrook as individual insurance agents. BD and Associated Insurance
Agency shall not propose a registered representative, or Agent, for
appointment unless such representative, or Agent, is duly licensed as an
insurance agent in the state(s) in which it is proposed that such
representative, or Agent, engage in solicitations of sales of the
Contracts. BD and Associated Insurance Agency together shall be
responsible for registered representatives', and Agents', compliance with
applicable state insurance agent licensing laws.
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b. BD and Associated Insurance Agency shall assist Glenbrook and ALFS in the
appointment of BD's registered representatives, and Agents, under
applicable insurance laws, to sell the Contracts. BD and Associated
Insurance Agency shall comply with Glenbrook requirements for, including
the General Letter of Recommendation (attached as Exhibit A) , in
submitting licensing or appointment documentation for proposed registered
representatives and Agents. All such documentation shall be submitted by
BD or Associated Insurance Agency to Glenbrook or its designated agent
licensing administrator.
c. Glenbrook reserves the right to refuse to appoint any such designated
individual or, once appointed, to terminate or refuse to renew the
appointment of any such designated individual. Only those registered
representatives who are duly licensed as insurance agents and appointed by
Glenbrook (herein, "Representatives") shall have authority to solicit
sales of the Contracts. Only those Agents who are registered
representatives of BD shall have authority to solicit sales of the
Registered Contracts. Agents who are not registered representatives of BD
shall be limited to selling those Contracts which are not Registered
Contracts ("Fixed Contracts"). BD and Associated Insurance Agency shall
notify ALFS immediately in writing if any Representative appointed by
Glenbrook ceases to be a registered representative of BD or if any
Representative or Agent ceases to be properly licensed in any state.
5. SUPERVISION OF REPRESENTATIVES AND AGENTS
a. BD shall have full responsibility for training and supervision of all
Representatives and all other persons associated with BD who are involved
directly or indirectly in the offer or sale of the Registered Contracts,
and all such persons shall be subject to the control of BD with respect to
such persons' activities in connection with the sale of the Registered
Contracts. Associated Insurance Agency shall have full responsibility for
training and supervision of all Agents who are involved directly or
indirectly in the offer or sale of the Contracts and for Agent's
compliance with applicable state insurance laws.
b. Before Representatives engage in the solicitation of applications for the
Registered Contracts, BD and Associated Insurance Agency will cause the
Representatives (1) to be registered representatives of BD; (2) to be
licensed, registered or otherwise qualified under applicable federal and
state laws to engage in the sale of the Contracts; (3) to be trained in
the sale of the Contracts; and (4) to limit solicitation of applications
for the Contracts to jurisdictions where Glenbrook has authorized such
solicitations.
c. Before Representatives or Agents engage in the solicitation of
applications for the Fixed Contracts, Associated Insurance Agency will
cause such individuals (1) to be licensed or otherwise qualified under
applicable laws to engage in the sale of the Fixed Contracts; (2) to be
trained in the sale of the Fixed Contracts; and (3) to limit solicitation
of applications for the Fixed Contracts to jurisdictions where Glenbrook
has authorized such solicitations.
d. BD is specifically charged with the responsibility of supervising and
reviewing its Representatives' use of sales literature and advertising and
all other communications with the public in connection with the Contracts.
With regard to Registered Contracts, no sales solicitation, including the
delivery of supplemental sales literature or other such materials, shall
occur, be delivered to, or used with a prospective purchaser unless
accompanied or preceded by the appropriate then current prospectus(es),
the then current prospectus(es) for the underlying funds funding any
variable contracts (the "Funds") and, where required by state insurance
law, the then current statement of additional information for any variable
contracts.
e. BD shall execute any electronic or telephone orders only in accordance
with the current prospectus applicable to the Contracts and agrees, that
in consideration for the telephone transfer privileges, Glenbrook 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 BD or its representatives.
f. Upon request by Glenbrook, BD and Associated Insurance Agency shall
furnish appropriate records or other documentation to evidence BD's and
Associated Insurance Agency's diligent supervision.
g. In the event a Representative or Agent performs any unauthorized
transaction(s) with respect to a Contract(s), BD shall bear sole
responsibility, shall notify Glenbrook and shall act to terminate the
sales activities of such Representative or Agent relating to the
Contract(s).
h. In the event a Representative or Agent fails to meet the BD's or
Associated Insurance Agency's rules and standards, BD or Associated
Insurance Agency, as the case may be, shall notify Glenbrook and shall act
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to terminate the sales activities of such Representative or Agent relating
to the Contracts.
6. SALES PROMOTION MATERIAL AND ADVERTISING
a. BD, Associated Insurance Agency, Agents and Representatives, in
connection with the offer or sale of the Contracts or solicitation of a
payment or other transaction under a Contract, shall not give any
information or make any representations or statements, written or oral,
concerning the Contracts or a Fund, inconsistent with information or
representations contained, in the case of a Registered Contract, in the
prospectus, statement of additional information and registration statement
for the Contracts or such Fund, or in reports or proxy statements thereof,
or in promotional, sales or advertising material or other information
supplied and approved in writing by ALFS for such use, or in the case of
Fixed Contracts, in the contracts or materials furnished by Glenbrook.
BD, Associated Insurance Agency, Agents and Representatives may not modify
or represent that they may modify any such prospectus, statement of
additional information, registration statement, promotional, sales or
advertising materials.
b. No item of sales promotion materials or advertising relating to the
Contracts, including any illustrations or software programs therefor,
shall be used by BD, Associated Insurance Agency, Agents or
Representatives unless the specific item has been provided by Glenbrook
and ALFS or has first been approved in writing by Glenbrook and ALFS for
use. Glenbrook and ALFS reserve the right to recall any material provided
by them at any time for any reason, and BD and Associated Insurance Agency
shall promptly comply with any such request for the return of material and
shall not use such material thereafter.
7. SOLICITING APPLICATIONS AND PAYMENTS
a. All applications for Contracts shall be made on application forms
supplied by Glenbrook. BD, Associated Insurance Agency, Agents and the
Representatives shall not 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 regulations of any state insurance commission,
and with respect to Registered Contracts, the SEC and the NASD. While not
limited to the following, a determination of suitability shall be based on
information concerning the prospective purchaser's insurance and
investment objectives and financial situation and needs.
b. BD and Associated Insurance Agency shall review applications for
completeness and correctness, as well as compliance with the suitability
standards specified above. BD will promptly, but in no case later than
the end of the next business day following receipt by BD or a
Representative, forward to Glenbrook according to administrative
procedures all complete and correct applications for suitable
transactions, together with any payments received with the applications,
without deduction for compensation unless there has been a mutual
arrangement for net wire transmissions between ALFS, Glenbrook and BD.
Glenbrook reserves the right to reject any Contract application and return
any payment made in connection with an application that is rejected.
c. Contracts issued on accepted applications will be forwarded to BD for
delivery to the Contract Owner according to procedures established by
Glenbrook, unless Glenbrook has provided otherwise. BD shall cause each
such Contract to be delivered to the respective Contract Owner within five
days after BD's receipt. BD shall be liable to Glenbrook for any loss
incurred by Glenbrook (including consequential damages and regulatory
penalties) as a result of any delay by BD or a Representative in
delivering such Contract.
d. BD, Associated Insurance Agency, Agents and Representatives shall not
encourage a prospective purchaser to surrender or exchange a Contract in
order to purchase another insurance policy or contract except when a
change in circumstances makes the Contract an unsuitable investment for
the Contract owner.
8. PAYMENTS RECEIVED BY BD
All premium payments (hereinafter collectively referred to as "Payments") are
the property of Glenbrook and shall be transmitted to Glenbrook by BD
immediately upon receipt by BD or Associated Insurance Agency or any Agent or
Representative in accordance with the administrative procedures of Glenbrook,
without any deduction or offset for any reason, including by example but not
limitation any deduction or offset for compensation claimed by BD. CUSTOMER
CHECKS SHALL BE MADE PAYABLE TO THE ORDER OF "GLENBROOK LIFE AND ANNUITY
COMPANY." Glenbrook reserves the right to reject any Payment for any reason.
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9. COMMISSIONS PAYABLE
a. Commissions payable in connection with the Contracts shall be paid to
Associated Insurance Agency according to the Commission Schedule(s)
relating to this Agreement in effect at the time of receipt by Glenbrook
of the payment or transaction request on which such commissions are based.
If available, a Commission Option(s) may: (1) be elected by BD and
Associated Insurance Agency on behalf of all of its Representatives or
Agents or (2) may be elected by each Representative or Agent at the time
of Application. Any election made and applied to a Contract may not be
changed and will be in effect for the life of the Contract. Glenbrook and
ALFS reserve the right to revise the Commission Schedule(s) for new
business at any time upon at least thirty (30) days prior written notice
to BD and Associated Insurance Agency.
b. Compensation to the Representatives or Agents for Contracts solicited by
the Representatives or Agents and issued by Glenbrook will be governed by
agreements between BD or the Associated Insurance Agency and their
respective Representatives or Agents and payment thereof will be the BD's
or Associated Insurance Agency's sole responsibility.
10. REFUND OF COMMISSIONS
If Glenbrook is required to refund premiums or return contract values and waive
surrender charges on any Contract for any reason, then commission will be
adjusted with respect to said premiums or Contract as set forth in the
Commission Schedule, and any commission previously paid for said premiums must
be refunded to Glenbrook or ALFS. ALFS shall have the right to offset any such
refundable commission against amounts otherwise payable by ALFS. ALFS agrees
to notify BD and Associated Insurance Agency within thirty (30) days after it
receives notice from Glenbrook of any premium refund or a commission charge
back.
11. ASSOCIATED INSURANCE AGENCY
BD and the Associated Insurance Agency represent 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. BD and Associated Insurance Agency
shall notify ALFS immediately in writing if BD and/or such agency fail 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. If Associated
Insurance Agency is the same person as BD, this Paragraph 11 does not apply,
and BD shall undertake all the duties, responsibilities and privileges under
this Agreement.
12. HOLD HARMLESS AND INDEMNIFICATION PROVISIONS
a. No party to this Agreement will be liable for any obligation, act or
omission of any other party. BD and Associated Insurance Agency will hold
harmless and indemnify Glenbrook and ALFS, and conversely, Glenbrook and
ALFS will hold harmless and indemnify BD and Associated Insurance Agency
for any loss or expense suffered as a result of the violation or
noncompliance by the indemnifying party of or with any applicable law or
regulation or any provision of this Agreement. Further, any BD violation
or noncompliance by an associated person, as defined in Article 1 of the
NASD By-Laws, would be covered under this provision.
b. Without limiting the above paragraph, in situations when "as of" pricing
is necessary in connection with the Contracts (and a loss is incurred to
compensate the Contract owner for reduced Contract values) the party whose
actions resulted in the loss will bear the costs according to pricing
procedures established by Glenbrook.
13. NON-ASSIGNABILITY PROVISION
This Agreement may not be assigned by any party except by mutual consent of all
other parties.
14. NON-WAIVER PROVISION
Failure of any party to terminate the Agreement for any of the causes set forth
in this Agreement will not constitute a waiver of that party's right to
terminate this Agreement at a later time for any of these causes.
15. AMENDMENTS
Except as stated in Paragraph 9, no amendment to this Agreement will be
effective unless it is in writing and signed by all the parties hereto.
16. INDEPENDENT CONTRACTORS
BD and its Representatives, and Associated Insurance Agency and its Agents, are
independent contractors with respect to Glenbrook and ALFS.
17. NOTIFICATION OF CUSTOMER COMPLAINTS OR DISCIPLINARY PROCEEDINGS
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a. BD and Associated Insurance Agency agree to notify ALFS promptly of any
customer complaints or disciplinary proceedings against BD, Associated
Insurance Agency or any Representatives or Agents relating to the
Contracts or any threatened or filed arbitration action or civil
litigation arising out of solicitation of the Contracts.
b. BD and Associated Insurance Agency shall cooperate with Glenbrook in
investigating and responding to any customer complaint, attorney demand,
or inquiry received from state insurance departments or other regulatory
agencies or legislative bodies, and in any settlement or trial of any
actions arising out of the conduct of business under this Agreement.
c. Any response by BD or Associated Insurance Agency to an individual
customer complaint will be sent to Glenbrook and ALFS for approval not
less than five (5) business days prior to it being sent to the customer,
except that if a more prompt response is required, the proposed response
may be communicated by telephone, facsimile or in person.
18. BOOKS, ACCOUNTS AND RECORDS
a. BD and Associated Insurance Agency agree to maintain books, accounts and
records so as to clearly and accurately disclose the nature and details of
transactions relating to the Contracts and to assist Glenbrook and ALFS in
the timely preparation of their respective books, accounts and records.
BD and Associated Insurance Agency shall upon request submit such books,
accounts and records to the regulatory and administrative bodies which
have jurisdiction over Glenbrook or the Funds.
b. Each party to this Agreement shall promptly furnish to the other parties
any reports and information which another party may request for the
purpose of meeting its reporting and recordkeeping obligations under the
insurance laws of any state, and under the federal and state securities
laws or the rules of the NASD.
19. LIMITATIONS
No party other than Glenbrook shall have authority on behalf of Glenbrook to
make, alter, or discharge any Contract issued by Glenbrook, to waive any
forfeiture provision or to grant, permit, or extend the time of making any
Payments, or to alter the forms which Glenbrook may prescribe or substitute
other forms in place of those prescribed by Glenbrook or to enter into any
proceeding in a court of law or before a regulatory agency in the name of or on
behalf of Glenbrook.
20. CONFIDENTIALITY
Each party to this Agreement shall maintain the confidentiality of any material
designated as proprietary by another party, and shall not use or disclose such
information without the prior written consent of the party designating such
material as proprietary.
21. TERMINATION
a. This Agreement may be terminated at the option of any party upon ten (10)
days written notice to the other parties, or at the option of any party
hereto upon the breach by any party of the covenants and terms of this
Agreement. Paragraph 12 shall survive any such termination.
b. This Agreement may be terminated immediately for cause upon an event of
default. Such termination shall be deemed to occur as of the date
immediately preceding the event of default. An "event of default" shall
occur when the first of the (i) BD or Associated Insurance Agency files
for bankruptcy, or financial or corporate reorganization under federal or
state insolvency law; (ii) applicable laws or regulations prohibit BD or
Associated Insurance Agency from continued marketing of the Contracts.
22. NOTICE
a. In the event of sale, transfer or assignment of a controlling interest in
BD or Agency, notice shall be provided in writing to Glenbrook no less
than thirty (30) days prior to the closing date.
b. All notices to Glenbrook and ALFS relating to this Agreement will be duly
provided by certified or express mail to:
General Counsel
Glenbrook Life and Annuity Company
0000 Xxxxxxx Xxxx
Xxxxxxxxxx, Xxxxxxxx 00000
All notices to BD and Associated Insurance Agency will be duly provided if
mailed to their respective address shown the Agency
Specification/Signature Page(s).
23. SEVERABILITY
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Should any provision of this Agreement be held unenforceable, those provisions
not affected by the determination of unenforceability shall remain in full
force and effect.
24. GOVERNING LAW
This Agreement will be construed in accordance with the laws of the State of
Illinois.
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EXHIBIT A
GENERAL LETTER OF RECOMMENDATION
BD hereby certifies to Glenbrook Life and Annuity Company ("Glenbrook") that
all the following requirements will be fulfilled in conjunction with the
submission of appointment papers for all applicants as agents of Glenbrook
submitted by BD. BD will, upon request, forward proof of compliance with same
to Glenbrook 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 be of good moral character, has a good
business reputation, is reliable, is financially responsible and is worthy
of appointment as a variable contract agent of Glenbrook. This inquiry
and background investigation has included a credit and criminal check on
each applicant. Based upon our investigation, we vouch for each applicant
and certify that each individual is trustworthy, competent and qualified
to act as an agent for Glenbrook to hold himself out in good faith to the
general public.
2. We have on file the appropriate state insurance department licensing
forms (i.e, B-300, B-301), or U-4 form which was completed by each
applicant. We have fulfilled all the necessary investigative requirements
for the registration of each applicant as a registered representative
through our NASD member firm, and each 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 or appointment and
all the findings of all investigative information is favorable.
3. We certify that all educational requirements have been met for the
specific state each applicant is licensed in, and that, all such persons
have fulfilled the appropriate examination, education and training
requirements.
4. 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.
5. We will not permit any applicant to transact insurance as an agent
until duly licensed and appointed by Glenbrook. 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
on behalf of Glenbrook, and they will not be so permitted until the
certificate of authority applied for is received.
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