EXHIBIT 1.(A)(3)(B)
Proposed Form of Selling Agreement
EXHIBIT 1.(A)(3)(B)
Proposed Form of Selling Agreement
SELLING AGREEMENT
AGREEMENT, made on this __________day of ____________________ , 19 __ , by
and between First Ameritas Life Insurance Corp. of New York ("First Ameritas"),
a Nebraska Corporation, Ameritas Investment Corp., a Nebraska Corporation and
_______________ ("Broker/Dealer"), a _______________________ Corporation.
WHEREAS, First Ameritas issues group annuity contracts ("Contracts"); and
WHEREAS, Broker/Dealer is duly licensed as a Broker/Dealer with the
National Association of Securities Dealers ("NASD") and the Securities and
Exchange Commission ("SEC"), and
WHEREAS, First Ameritas proposes to have Broker/Dealer's representatives
("Representatives(s)") who are also duly licensed insurance agents solicit sales
of the Contracts , and
WHEREAS, Broker/Dealer, has the authority and responsibility for training
and supervising its registered representatives and for certain administrative
responsibilities and duties,
NOW, THEREFORE, in consideration of the premises and mutual promises
contained herein, the parties hereto agree as follows:
A. APPOINTMENT
First Ameritas hereby appoints Broker/Dealer to supervise solicitation of
the Contracts listed on Exhibit A, which is attached hereto and incorporated by
reference, and to facilitate solicitations of sales of the Contracts.
B. REPRESENTATIONS
1. First Ameritas and Broker/Dealer each represents to the other that it
and the undersigned officers have full power and authority to enter into this
Agreement.
2. Broker/Dealer represents that it is registered as a Broker/Dealer under
the Securities Exchange Act of 1934 (the "1934 Act") and under the Blue Sky Laws
of each jurisdiction in which such registration is required for the sale of the
Contracts; and, that Broker/Dealer is a member of the NASD.
3. First Ameritas represents to Broker/Dealer that it is licensed to issue
insurance in New York.
4. First Ameritas represents to Broker/Dealer that the Contracts it issues
have been duly filed and approved by the state insurance departments in those
jurisdictions where it is authorized to transact business.
C. COMPLIANCE WITH NASD RULES OF FAIR PRACTICE AND FEDERAL AND STATE SECURITIES
AND STATE INSURANCE LAWS
Broker/Dealer agrees to abide by all rules and regulations of the NASD as
applicable, including its Rules of Fair Practice, and to comply with all
applicable state and federal laws and the rules and regulations of authorized
regulatory agencies affecting the sale of the Contracts and the licensing of its
Representatives.
D. LICENSING AND/OR APPOINTMENT OF REPRESENTATIVES
Broker/Dealer shall assist First Ameritas in the licensing and/or
appointment of Representatives under applicable insurance laws to sell the
Contracts. Broker/Dealer shall fulfill all requirements set forth below in
conjunction with the submission of licensing/appointment papers for all
applicants as insurance agents of First Ameritas. All such licensing/appointment
papers should be submitted by the Broker/Dealer to First Ameritas as it may from
time to time request. Broker/Dealer understands that First Ameritas reserves the
right to refuse to appoint any Representative or, once appointed, to thereafter
terminate the same.
Further, Broker/Dealer hereby certifies and represents to First Ameritas
that all the following requirements will be fulfilled by the Broker/Dealer in
conjunction with the submission of licensing/appointment papers for all
applicants as agents of First Ameritas. Broker/Dealer will, upon request,
forward proof of compliance with same to First Ameritas in a timely manner.
1. Broker/Dealer has made a thorough and diligent inquiry and investigation
relative to each applicant's identity, residence and business reputation and
declares that each applicant is personally known to the Broker/Dealer, has been
examined by it, is known to be of good moral character, has a good business
reputation, is reliable, is financially responsible and is worthy of a
securities and a life insurance license. Each individual is trustworthy,
competent and qualified to act as an agent for First Ameritas and to hold
himself or herself out in good faith to the general public. The Broker/Dealer
vouches for each applicant.
2. Broker/Dealer has on file all forms required by the NASD, state
insurance, and securities licensing authorities, which forms have been completed
by each applicant. Broker/Dealer has fulfilled all the necessary investigative
requirements for the registration of each applicant as a registered
representative through the Broker/Dealer, and each applicant is presently
registered as an NASD registered representative and licensed with applicable
state licensing authorities. The above information in the Broker/Dealer files
indicates no fact or condition which would disqualify the applicant from
receiving or maintaining a securities or life insurance license and all the
findings of all investigative information are favorable.
3. Broker/Dealer certifies that all educational requirements have been met
for all states for which the applicant is requesting a securities or life
insurance 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, his or her
signature, and securities registration in the state in which he or she is
applying for a securities or life insurance license, Broker/Dealer certifies
that those items forwarded to First Ameritas are those of the applicant and the
securities registration is a true copy of the original.
5. Broker/Dealer certifies that each applicant will receive close and
adequate supervision in connection with the sale of Contracts issued by First
Ameritas and that the Broker/Dealer will make inspections 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.
6. Broker/Dealer will not permit any applicant to act as a life insurance
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 they have met the licensing and appointment requirements of relevant
states' laws.
E. SUPERVISION OF REPRESENTATIVE
Broker/Dealer, shall have full responsibility for the training and
supervision of all Representatives associated with Broker/Dealer who are engaged
directly or indirectly in the offer or sale of the Contracts and all such
persons shall be subject to the control of Broker/Dealer with respect to such
persons in connection with the sale of the Contracts. Broker/Dealer shall comply
with the administrative procedures of First Ameritas involving applicable
federal securities law, state insurance law or other law. Before Representatives
engage in the solicitation of applications for the Contracts, the Broker/Dealer
will cause (1) the Representatives to be trained in the sale of the Contracts;
(2) the Representatives to qualify under applicable federal and state laws to
engage in the sale of the Contracts; (3) the Representatives to be registered
representatives of Broker/Dealer and (4) will cause such Representatives to
limit solicitation of applications for the Contracts to jurisdictions where
First Ameritas has authorized such solicitation. Broker/Dealer shall cause such
Representatives' qualifications to be certified to the satisfaction of First
Ameritas and shall notify First Ameritas if such Representative ceases to be a
registered representative of Broke/Dealer. Broker/Dealer shall also cause all
sales of the Contracts to be reviewed for suitability as provided for in the
applicable rules of the NASD. Broker/Dealer is specifically charged with the
responsibility of supervising and reviewing Representatives' use of sales
literature and advertising and all other communications with the public in
connection with the Contracts. Upon request by First Ameritas, Broker/Dealer
shall furnish appropriate records or other documentation to evidence
Broker/Dealer's diligent supervision.
F. NOTICE OF REPRESENTATIVE'S NONCOMPLIANCE
In the event a Representative fails or refuses to submit to supervision of
Broker/Dealer or otherwise fails to meet the rules and standards imposed by
Broker/Dealer for its Representatives, Broker/Dealer shall certify such fact to
First Ameritas and shall immediately notify such Representative that he or she
is no longer authorized to sell the Contracts, and Broker/Dealer shall take
whatever additional action may be necessary to terminate the sales activities of
such Representative relating to the Contracts.
G. SALES PROMOTION MATERIAL AND ADVERTISING
No sales promotion materials or advertising relating to the Contracts shall
be used by Broker/Dealer unless the specific item has been approved in writing
by First Ameritas. No representations in connection with the sales of the
Contracts, other than those contained in the sales promotion materials or
advertising applicable to the Contracts which have been preapproved in writing
by First Ameritas, shall be made by Broker/Dealer or its Representatives.
H. SECURING APPLICATIONS
All applications for Contracts shall be made on application forms supplied
by First Ameritas. Broker/Dealer will review all sales for suitability.
Applications will be promptly forwarded to First Ameritas, together with any
payments received with the applications, without deduction for compensation.
First Ameritas reserves the right to reject any Contract application and return
any payment made in connection with an application which is rejected. Contracts
issued on accepted applications by First Ameritas will be forwarded to the owner
of the contract ("Contractowner ") in accordance with the administrative
procedures of First Ameritas.
I. PAYMENTS
All contract payments (hereinafter collectively referred to as ("Payments")
are the property of First Ameritas and shall be transmitted to First Ameritas
immediately in accordance with the administrative procedures of First Ameritas,
without any deduction or offset for any reason, including by example but not
limitation, any deduction or offset for compensation claimed by Broker/Dealer.
CHECKS SHALL BE MADE PAYABLE TO THE ORDER OF "First Ameritas LIFE INSURANCE
CORP."
J. COMMISSIONS PAYABLE
Commissions payable in connection with the contracts shall be paid to the
Broker/Dealer or, with the consent of First Ameritas, and at the request and
with the permission of the Broker/Dealer, as the Broker/Dealer otherwise directs
in writing. In those instances where the Broker/Dealer or a Compensation
Administrator receives commissions on behalf of the Registered Representative or
shares commissions with the Registered Representative, the Broker/Dealer will
remain responsible, as set out herein, for recordkeeping, training, state
licensing, and supervising the Registered Representative's activities for
compliance with the Federal and State Securities Laws, State Insurance Laws, the
NASD Rules and any other laws or rules which may be applicable. These
commissions will be paid as a percentage of payments received in cash or other
legal tender and accepted by First Ameritas on applications obtained by the
Representatives of the Broker/Dealer, and/or as a percentage of the accumulated
value in such contracts. Upon termination of this agreement, all compensation to
the Broker/Dealer hereunder shall cease; however, Broker/Dealer shall continue
to be liable for any chargebacks pursuant to Sections M and N of this Agreement
or for any other amounts advanced by or otherwise due First Ameritas. Further,
compensation with respect to a particular Contract shall cease upon the
Contractowner's direction that the Broker/Dealer or its Representative be
removed as agent of record.
K. TIME OF PAYMENT
First Ameritas shall pay any Compensation due Broker/Dealer in a timely
manner.
L. COMMISSION AGREEMENTS
This Agreement shall apply to compensation due on applications received by
First Ameritas on or after the effective date first written above.
Broker/Dealer acknowledges that commission agreements will be individualized
on a contract-by-contract basis. Such commission agreements will incorporate
this Selling Agreement. Broker/Dealer or its designee's submission of an
application, and Broker/Dealer's signature on the commission agreement, to First
Ameritas constitutes its agreement to each specific commission agreement. First
Ameritas agrees to provide Broker/Dealer with one copy of each final commission
agreement supplement to this Agreement.
Broker/Dealer acknowledges further that neither it nor its Representatives
have any vested right in continuing commissions on specific Contracts. It is
understood that the Contractowner dictates and controls, directly or indirectly,
who its Representative, and therefore its Broker/Dealer are, and that the
Contractowner may direct that the Broker/Dealer or Representative be removed as
agent of record at any time. First Ameritas reserves the right, in its sole
judgment, exercised in good faith, to discontinue any commission agreement at
any time, without notice, provided that First Ameritas has determined that the
continuation of the commission agreement would have a material adverse effect
upon First Ameritas or the ability of the Representative to perform.
M. FINANCIAL PLANNING OR OTHER FEES
Neither Broker/Dealer nor any Representative associated with Broker/Dealer
may accept from any individual or entity any share of financial planning or
other fee income, either directly or indirectly derived from the sale of
Contracts sold pursuant to this Agreement, unless permitted to do so by Federal
law and State law of the State in which the Broker/Dealer or the
Representative(s) is/are licensed to do business. It shall be the sole
responsibility of Broker/Dealer to ensure that all Representatives associated
with Broker/Dealer do not accept such income.
If Federal law and the State law of the State in which the Broker/Dealer or
Representative(s) is/are licensed to do business permits an insurance agent to
accept commission payments and financial planning or other fee income from the
sale of a Contract it shall be the sole responsibility of Broker/Dealer, before
accepting such a fee or permitting Representative to accept such fees, to ensure
that Broker/Dealer and each Representative associated with it have secured any
and all licenses necessary to charge fees as may be required by Federal law, by
First Ameritas, or by the laws of the State or States in which Broker/Dealer or
Representative is licensed to solicit insurance.
N. CANCELLATION OF CONTRACT
If First Ameritas is required to refund contract payments on any Contract
for any reason, then, no commission will be payable with respect to said
Payments and any commission previously paid for said Payments must be refunded
to First Ameritas by Broker/Dealer. First Ameritas agrees to notify
Broker/Dealer within thirty (30) days after it refunds payment or a commission
chargeback occurs. Any refund of commission which Broker/Dealer must make under
this Section shall be netted (charged back) against Broker/Dealer's next month's
commissions. Broker/Dealer shall be liable for any commission refund in excess
of commissions payable to Broker/Dealer.
O. HOLD HARMLESS AND INDEMNIFICATION PROVISIONS
1. First Ameritas will indemnify and hold harmless Broker/Dealer from any
and all losses, claims, damages or liabilities for actions in respect thereof,
to which Broker/Dealer may become subject, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are based
upon any untrue statement of any material fact contained in the First Ameritas
prepared sales or advertising material for any of the Contracts or any amendment
or supplement thereto, or arise out of or are based upon the omission or alleged
omission to state therein a material fact required to be stated therein or
necessary to make the statements therein not misleading, and will provide
Broker/Dealer with appropriate legal representation in connection with
investigating or defending against such loss, claim, damage, liability or action
in respect thereof; provided, however, that First Ameritas shall not be liable
in any such case to the extent that any such loss, claim, damage or liability
arises out of or is based upon an
untrue statement or omission or alleged omission made in reliance upon and in
conformity with information furnished by Broker/Dealer specifically for First
Ameritas' use.
The foregoing indemnities shall, upon the same terms and conditions, extend
to and inure to the benefit of each director and officer of Broker/Dealer and
any person controlling Broker/Dealer.
2. First Ameritas shall indemnify and hold harmless Broker/Dealer against
any losses, claims, damages or liabilities (or actions in respect thereof) to
which Broker/Dealer may become subject, insofar as such losses, claims, damages
or liabilities (or actions in respect thereof) result from negligent, fraudulent
or unauthorized acts or omissions by First Ameritas or its associates.
The foregoing indemnities shall, upon the same terms and conditions, extend
to and inure to the benefit of each director and officer of Broker/Dealer and
any person controlling Broker/Dealer.
3. Broker/Dealer shall indemnify and hold harmless First Ameritas from any
and all losses, claims, damages or liabilities (or actions in respect thereof)
to which First Ameritas may become subject, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or result
from negligent, improper, fraudulent or unauthorized acts or omissions by
Broker/Dealer, its employees or sales personnel or principals, including but not
limited to improper solicitations of applications for the Contracts.
Broker/Dealer shall indemnify and hold harmless First Ameritas for any
losses, claims, damages or liabilities (or actions in respect thereof) to which
First Ameritas may become subject, insofar as the losses, claims, damages or
liabilities (or actions in respect thereof) arise out of or are based upon any
unauthorized use of sales materials or advertisements or any oral or written
misrepresentations or any unlawful sales practices concerning the Contracts by
Broker/Dealer.
The foregoing indemnities shall, upon the same terms and conditions, extend
to and inure to the benefit of each director and officer of First Ameritas and
any person controlling First Ameritas.
4. Promptly after receipt by an indemnified party of notice of the
commencement of any action, such indemnified party shall, if a claim is to be
made against the indemnifying party, notify the indemnifying party in writing of
the commencement thereof; but the omission so to notify the indemnifying party
shall not relieve it from any liability which it may otherwise have to any
indemnified party. In case any such action shall be brought against any
indemnified party, and it shall notify the indemnifying party of the
commencement thereof, the indemnifying party shall be entitled to participate
in, and, to the extent that it shall wish, jointly with any other indemnifying
party, similarly notified, to assume the defense thereof and proportionate costs
associated therewith, with counsel satisfactory to such indemnified party. After
notice from the indemnifying party to such indemnified party of its election so
to assume the defense thereof, the indemnifying party shall not be liable to
such indemnified party for any legal or other expense subsequently and
independently incurred by such indemnified party in connection with the defense
thereof other than reasonable costs of investigation.
P. NON-WAIVER PROVISION
Failure of any party to terminate this Agreement for any of the causes set
forth in this Agreement will not constitute a waiver of the right to terminate
this Agreement at a later time for any of these causes.
Q. AMENDMENTS
No amendment to this Agreement will be effective unless it is in writing
and signed by all the parties hereto.
R. INDEPENDENT CONTRACTORS
Broker/Dealer and its Representatives are independent contractors with
respect to First Ameritas. The Broker/Dealer and its Representatives may
exercise their own judgment as to selecting prospects for Contracts, the hours
worked, and the time and locales of negotiating sales, and otherwise as to the
time and manner in which they perform the services contemplated by this
Agreement. First Ameritas may from time-to-time, prescribe rules and regulations
respecting the conduct of the business contemplated by this Agreement, not
interfering with such freedom of action of the Broker/Dealer or its
Representatives.
S. NOTIFICATION OF DISCIPLINARY PROCEEDINGS
Broker/Dealer agrees to notify First Ameritas in a timely fashion of any
disciplinary proceedings against any of Broker/Dealer's Representatives
soliciting sales of the Contracts or any threatened or filed arbitration action
or civil litigation arising out of Broker/Dealer's solicitation of the
Contracts.
T. BOOKS AND RECORDS
First Ameritas and Broker/Dealer agree to maintain the books, accounts and
records so as to clearly and accurately disclose the nature and details of
transactions and to assist each other in the timely preparation of records.
First Ameritas and Broker/Dealer shall each submit such records to the
regulatory and administrative bodies which have jurisdiction over First
Ameritas. Each party to this Agreement shall promptly furnish to the other party
any reports and information which the other party may reasonably request for the
purpose of meeting its reporting and recordkeeping requirements under the
insurance laws of any state, under the federal and state securities laws, the
rules of the NASD, or other state or federal law, to the extent applicable.
U. CONFIDENTIALITY OF INFORMATION
First Ameritas and Broker/Dealer respectively agree that all Contractowner
facts or information received by any party hereto shall remain confidential as
to all parties unless such information is required by any regulatory authority
or court of competent jurisdiction.
V. LIMITATIONS
No party other than First Ameritas shall have the authority on behalf of
First Ameritas to make, alter, or discharge any Contract issued by First
Ameritas, to waive any forfeiture or to grant, permit, or to extend the time of
making any payments, or to alter the forms which First Ameritas may prescribe or
substitute other forms in place of
those prescribed by First Ameritas, or to enter into any proceeding in a court
of law or before a regulatory agency in the name of or on behalf of First
Ameritas.
W. TERMINATION
This Agreement may be terminated:
1. At the option of any party upon thirty (30) days written notice to the
other parties; or
2. At the option of First Ameritas in the event that formal administrative
proceedings are instituted against the Broker/Dealer by the NASD, SEC, any state
Insurance Commissioner or any other regulatory body regarding Broker/Dealer's
duties under this Agreement or related to the sale of the Contracts, and that
First Ameritas determines in its sole judgment exercised in good faith, that any
such administrative proceedings will have a material adverse effect upon the
ability of the Broker/Dealer to perform its obligations under this Agreement; or
3. At the option of First Ameritas if (a) First Ameritas shall determine in
its sole judgment exercised in good faith that Broker/Dealer has suffered a
material adverse change in its business or financial condition or is subject to
material adverse publicity and such material adverse change or material adverse
publicity will have a material adverse impact upon the business and operations
of First Ameritas, (b) First Ameritas shall notify Broker/Dealer in writing of
such determination and its intent to terminate this Agreement, and (c) after
considering the actions taken by Broker/Dealer and any other changes in
circumstances since the giving of such notice, such determination of First
Ameritas shall continue to apply on the sixtieth (60th) day following the giving
of such notice, which sixtieth day shall be the effective day of termination; or
4. At the option of any party hereto upon the breach by any other party of
the covenants and terms of this Agreement.
X. SEVERABILITY
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.
This Agreement will be construed in accordance with the laws of the State of
Nebraska.
First Ameritas Life Insurance Corp. of New York
by ___________________________________________________
Ameritas Investment Corp.
by___________________________________________________
Broker/Dealer
by ___________________________________________________
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