JEFFERSON NATIONAL LIFE INSURANCE COMPANY
INVIVA SECURITIES CORPORATION
SELLING GROUP AGREEMENT
This Selling Group Agreement ("Agreement") is made by and between Jefferson
National Life Insurance Company ("Company"), Inviva Securities Corporation
("Underwriter"), a broker-dealer registered with the Securities and Exchange
Commission ("SEC") and the National Association of Securities Dealers, Inc. (the
"NASD") with Administrative Offices in Louisville, Kentucky, and _____________
("Broker"), the broker-dealer, named herein and registered with the SEC as a
broker-dealer and a member of the NASD. Company and Underwriter are sometimes
referred to collectively as "Inviva." The parties do hereby agree as follows:
1. Authorization
Broker, either as an individual, partnership, or corporation, and its associated
persons who are NASD registered and are duly licensed under applicable state
insurance law and, where required, appointed as insurance agents of Inviva
("Representatives") are hereby authorized by Company and Underwriter to solicit
applications for variable annuity contracts and / or variable life insurance
policies (collectively "Policies"). The Compensation Schedule attached hereto is
made a part of the Agreement, and Broker agrees to solicit applications and
collect and remit initial required premiums to Company, and deliver policies
issued by Company:
a. only in jurisdictions where Broker is duly licensed by the
appropriate regulatory agencies and appointed by the Company, and;
b. only in states and territories in which Company is admitted to do
business and only for those Policies offered by Company that have
been approved by the appropriate regulatory agencies.
Licensing of agents shall be in compliance with the statutory and regulatory
requirements of the Departments of Insurance or other regulatory agencies and in
accordance with the standards and procedures established by Inviva.
Broker shall supply Company with copies of all certificates of qualification or
licenses required of Broker under this Agreement.
1.1 Limitation of Authority
Broker has no authority during the time this Agreement is in effect, or after
termination, to:
a. make or modify Policies on behalf of Company or waive any of
Company's rights or requirements;
b. collect or receive premiums or renewals other than the initial
premium;
c. endorse, cash or deposit any checks or drafts payable to the
Company;
d. open any bank account or trust account on behalf of, for the
benefit of, or
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containing the name of, Company;
e. advertise or publish any matter or thing, through any medium,
including, without limitation, use of the names, trademarks,
product names, services or logos of Company or those of its
subsidiaries or affiliates, concerning Company or its Policies
without prior written permission of Company;
f. directly or indirectly cause or endeavor to cause any Broker to
terminate or alter its/his/her contract with Company, or induce or
attempt to induce any policyholder of Company to relinquish,
surrender, replace, or lapse a Policy;
g. engage in or benefit from any unlawful, unsuitable or
Inviva-prohibited: sales, rebating, misrepresentation, twisting,
replacement or churning of Policies, or violations of any
applicable state or federal laws, rules or regulations; or
h. do or perform any acts or things other than expressly authorized
herein.
This agreement shall not create an employer-employee relationship. The
relationship of Broker to Company shall be that of independent contractor.
Broker agrees to furnish and maintain a satisfactory bond of indemnity as
required under the rules of the NASD, a copy of such bond to be submitted to
Company within 30 days of request.
1.2 Representations and Services
Broker agrees:
a. that it will take full responsibility for training and supervision
of all Representatives associated with Broker who are engaged
directly or indirectly in the offer or sale of the Policies and
all such persons shall be subject to the control of Broker with
respect to such persons' activities in connection with the sale of
Policies. Broker agrees to establish such rules and procedures as
are necessary to insure compliance with applicable federal and
state securities laws, and applicable state insurance laws;
b. to observe the rules, procedures and other directives established,
and given by Underwriter relating to the sale of the Policies by
Broker. However, provisions of the Underwriter's Manual pertaining
to underwriting practices, acceptance of risks, delivery of
Policies, and all other areas of conduct of Inviva's business
shall not be deemed to imply a duty of supervision by Company or
Underwriter over Broker, or to relieve Broker of its duty to
supervise its personnel. Broker will also comply with the rules
and regulations of the Securities and Exchange Commission and the
NASD, (including, without limitation, its Rules of Fair Practice),
relating to the sale and distribution of the Policies and will
observe all applicable federal and state laws relating to the
Policies, and the regulations of authorized regulatory agencies
affecting the sale of insurance;
c. that all solicitations for Policies are accompanied by the
appropriate current prospectuses for the Policies conforming to
the requirements of the Securities Act
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of 1933. Broker shall ensure that its Representatives shall not
make recommendations to an applicant to purchase a Policy in the
absence of reasonable grounds to believe that the purchase is
suitable for such applicant, as required by applicable state
insurance laws, the suitability requirements of the Securities
Exchange Act of 1934 ("1934 Act") and the NASD Conduct Rules.
Broker shall ensure that each application obtained by its
Representatives shall bear evidence of approval of one of its
principals indicating that the application has been reviewed for
suitability;
d. that no representations concerning the Policies will be made
except those contained in the appropriate current prospectuses and
in information supplemental to the prospectuses, which may be
supplied by Underwriter and designated for use with the public. In
this regard, Broker further agrees not to use advertising or sales
literature concerning the Policies unless and until it has been
approved by Underwriter;
e. to become fully informed as to the provisions and benefits of each
Policy offered by Company for which Broker solicits applications;
f. to represent such Policies adequately and fairly to prospects;
g. to provide all usual and customary service to policyholders and
work to maintain in force any business placed with Company; and
h. to hold all premiums received with any applications for Policies
solicited for Company and to promptly forward such premiums and
applications to the Company using a reasonable standard of care.
All such funds shall be segregated by Broker and held in trust,
and shall not be used by Broker for any purpose.
1.3 NASD Matters
Broker represents that it is a registered broker-dealer under the 1934 Act, a
member in good standing of the NASD, and a registered broker-dealer under
applicable state law to the extent necessary to perform the duties described in
this Agreement. Broker represents that its Representatives, who will be
soliciting applications for the Policies, will be duly registered
representatives associated with Broker and that they will be representatives in
good standing with accreditation as required by the NASD to sell the Policies.
Broker agrees to abide by all rules and regulations of the NASD, including its
Conduct Rules, and to comply with all applicable state and federal laws and the
rules and regulations of authorized regulatory agencies affecting the sale of
the Policies by Broker or any of its associated Representatives.
1.4 Broker's Agents
Broker will recruit, train and supervise Representatives to sell the Policies.
Appointment of each Representative shall be subject to Company's prior approval.
Company may terminate any Representative without Broker's prior approval.
Company may require termination of any Representative's authority to sell the
Policies. Broker is responsible for the Representatives'
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compliance with the terms and conditions of this Agreement and for the
Representative being duly licensed pursuant to applicable state and federal
laws.
1.5 Delivery of Policy
Broker shall promptly deliver all issued Policies in accordance with Company
rules.
1.6 Administrative Guidelines and Compliance
Company's administrative guidelines, including, without limitation, bulletins,
product and procedure updates, the revisions, additions and amendments thereto,
from the time made by Company, shall be complied with by Broker provided,
however, that this shall not be deemed to imply a duty of supervision by Company
or Underwriter over Broker, or to relieve Broker of its duty to supervise its
personnel. Broker agrees to comply fully with all applicable regulations,
bulletins, rulings, circular letters, proclamations and statutes, now or
hereafter in force, and to promptly notify Company in writing of all contacts
and/or correspondence received from insurance regulatory, or other governmental
authorities with regard to Policies sold under this agreement, and to cooperate
fully with Company in making responses to those authorities.
1.7 Licensing and/or Appointment of Representative
Broker shall assist Inviva in the licensing and/or appointment of
Representatives under applicable insurance laws to sell Policies.
1.8 Record Keeping
Broker is responsible for maintaining the records of its Representatives. Broker
shall maintain such other records as are required of it by applicable laws and
regulations. The books, accounts and records maintained by Broker that relate to
the sale of the Policies, or dealings with Company or Underwriter shall be
maintained so as to clearly and accurately disclose the nature and details of
each transaction.
Broker acknowledges that all the records maintained by Broker relating to the
solicitation, service or sale of the Policies subject to this Agreement,
including but not limited to applications, authorization cards, complaint files,
supervisory and inspection procedures and suitability reviews, shall be
available to Inviva upon request during normal business hours. Inviva may retain
copies of any such records which Inviva, in its discretion, deems necessary or
desirable to keep.
2. Compensation
All compensation payable for sales of the Policies shall be paid by Company to
Broker through Underwriter and nothing contained herein shall create any right,
title or interest in Underwriter to such compensation nor any responsibility on
the part of Underwriter for payment of such compensation. Company agrees to pay
compensation in the form of commissions and other payments as provided in the
Compensation Schedule(s) delivered to Broker by Company and incorporated herein
by reference, upon any cash premiums received by Company for Policies issued on
applications submitted by Broker. Such compensation shall be payment in full for
all
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services performed and all expenses incurred by Broker. Company reserves the
right to accrue compensation under this Agreement until a minimum of $25.00 has
become due. If this agreement is terminated for any reason, regardless of what
the Compensation Schedule(s) might provide, no compensation of any kind shall
thereafter be payable.
2.1 Compensation Schedule(s)
The Compensation Schedule(s) attached, or which may hereafter be added, is (are)
incorporated herein and made a part of this Agreement. Company reserves the
right to change such Compensation Schedule(s) at any time upon written notice to
Broker. However, no such changes shall be applicable to Policies for which
Company has accepted premiums prior to effective date of such change.
2.2 Accounting
Company will give to Broker a weekly statement of all compensation becoming due
and payable to Broker since the date of the previous monthly statement. This
statement shall also include Broker's indebtedness to Company, if any. Unless
Company receives written objection to such monthly statement from Broker, within
90 days after the date it is mailed to Broker's last known address or delivered
to Broker in person, the same shall be deemed final and binding upon Broker.
2.3 Exchanges
If in the sole discretion of Company a new Policy is issued to replace a
terminated or in-force policy of Company or its affiliates or subsidiaries, the
new Policy shall be regarded as an exchanged Policy, and any compensation
payable shall be determined and adjusted by Company in accordance with Company's
then current exchange rules, independent of the Compensation Schedule(s).
2.4 Return of Premium
If no Policy is issued on an application, the whole amount of all monies
collected by Broker will be immediately returned to the applicant. If Company
finds it necessary, for any reason, to cancel a Policy and refund premiums, any
compensation paid to Broker on the amount refunded shall be repaid to Company,
or may be deducted from any compensation payable to Broker under this Agreement.
2.5 Local Taxes
Broker is responsible for any county or municipal occupational or privilege fee,
tax or license which may be required of Broker or Representatives as a result of
business submitted hereunder.
2.6 Expenses
Broker shall pay all expenses of every nature incurred in connection with the
conduct of its business and Inviva shall not be liable in any way therefor.
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3. Indebtedness
Company shall have first lien upon any amounts due under this Agreement, or to
become due from Broker's indebtedness to Company or its affiliates and
subsidiaries, whether due or contingent, of Broker or Broker's assigns under
this Agreement. Such indebtedness may be deducted by Company from such amounts
due or to become due.
4. Termination
Termination of this Agreement is effected as follows:
a. Cause. This Agreement may be terminated for cause by Company,
immediately upon written notice to Broker, if Broker or Broker's
partner, director, officer, employee, registered representative or
agent has, or is reasonably believed to have:
(i) misappropriated funds from any policy owner or from
Company;
(ii) endeavored to induce policy owners of Company to relinquish
their policies;
(iii) interfered with the collection of renewal premiums;
(iv) engaged in fraudulent acts or any other act violative of
federal or state law or other applicable rules or
regulations, including, without limitation, the Conduct
Rules of the NASD;
(v) been adjudged a bankrupt or executed a general assignment
for benefit of creditors or committed an act of bankruptcy;
or
(vi) otherwise acted, in breach of this Agreement, to prejudice
materially the interest of Company.
If Company does not terminate this Agreement for any such cause, a waiver shall
not result and this Agreement may be terminated under this subparagraph for any
subsequent cause.
b. Death or Dissolution. If Broker is not a corporation or
partnership, this Agreement will terminate on the date of Broker's
death. If Broker is a corporation or partnership, this Agreement
will terminate on the date that the corporation or partnership is
dissolved or otherwise judged by appropriate regulatory agencies
no longer to be a legal entity.
c. License Suspension or Revocation. This Agreement will terminate
immediately in the event of any order of suspension, revocation or
termination of Broker's license by any regulatory authority.
d. Default. This Agreement will terminate immediately upon notice of
the event of:
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1. default under this Agreement; or
2. Broker or Broker's associated person's or registered
representative's failure to fully comply with
Company directives, rules, regulations or manuals in
a timely fashion.
e. Ownership Change. If Broker is not a natural person, this
Agreement will terminate in the event of a significant change in
Broker's ownership or management, or in the event of the execution
of an agreement of sale, transfer or merger of Broker, without
prior notice and consent of Company.
f. Notice. This Agreement may be terminated by either party for any
reason by giving the other party at least 30 days' advance written
notice delivered personally or mailed to the last known address of
the other party.
g. Indebtedness. Upon termination of this Agreement, any indebtedness
to Company becomes immediately due and payable.
h. Records. All books, application forms and material furnished by
Inviva pertaining to the solicitation of applications for
insurance hereunder shall be the property of Inviva and shall be
returned upon termination of this agreement.
5. Indemnification
Broker shall indemnify and hold harmless Company, Underwriter, and their
affiliated officers, directors, employees and agents from any and all claims,
demands, penalties, suits, or actions, and from any and all losses, costs, and
reasonable expenses in connection therewith, including reasonable attorney's
fees and expenses, arising out of or resulting from the sales of the Policies by
or through the Broker, or from the default in the performance of, or in the
negligent performance of the obligations of Broker under this Agreement, by
Broker or Broker's partners, directors, officers, employees or agents.
Inviva shall indemnify and hold harmless Broker and its affiliated officers,
directors, employees and agents from any and all claims, demands, penalties,
suits, or actions, and from any and all losses, costs, and reasonable expenses
in connection therewith, including attorney's fees and expenses, arising out of
or resulting from the default in the performance of, or the negligent
performance of the obligations of Inviva under this Agreement. The provisions of
this and the preceding paragraph shall survive the termination of this
Agreement.
6. Previous Agreement
By execution of this Agreement, any prior agreement(s) between the Company,
Underwriter and the Broker or between Company and the signing principal(s)
related specifically to the business transacted under this Agreement is
terminated as of the effective date of this Agreement; but while this Agreement
remains in force, any rights of Broker to receive compensation under the terms
and conditions of the prior agreement are continued hereunder, and such earned
compensation shall be payable at the rate, for the remainder of the period, and
on the basis applicable as if that agreement remained in force.
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7. Entire Agreement
This Agreement, including supplements and the Compensation Schedule(s),
constitutes the entire Agreement between the parties for all dealings after its
effective date. This Agreement shall not be assigned without the prior written
consent of Company. No amendment of this Agreement shall be valid unless made in
writing by Company.
8. Waiver
No waiver by Company of rights arising from wrongdoing or failure by Broker
shall occur by Company's election not to enforce any provision of this
Agreement, nor reduce or affect Company's rights arising from subsequent
wrongdoing or failure by Broker. Broker releases Company from any liability for
providing Social Security numbers and tax data to authorized governmental
agencies.
9. Notice
Any written notice given under any provision of this Agreement shall be complete
upon deposit, postage paid, in the U.S. Mail addressed to Broker at Broker's
last known address according to Company's records or to Company or Underwriter
at its Administrative Offices.
10. Arbitration
Any dispute, claim or controversy arising out of or relating to this Agreement,
performance hereunder or the breach hereof, or otherwise arising between Broker
and Company or Underwriter, shall be subject to mandatory arbitration under the
auspices, rules and by-laws of the NASD, as may be amended from time to time,
and any arbitration award may be entered as a judgment in a court of competent
jurisdiction. Notwithstanding the foregoing arbitration requirement, at its
option, Company and/or Underwriter may seek injunctive relief either within the
arbitration process or from a court of competent jurisdiction. Venue for any
such injunctive action shall be in a court located in Louisville, Jefferson
County, Kentucky. Venue for arbitration hearing shall be in Jefferson County,
Kentucky.
11. Construction
THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
NEW YORK EXCLUSIVE OF CHOICE OF LAWS PROVISIONS. INVIVA AND BROKER EACH
REPRESENT TO THE OTHER THAT IT AND THE OFFICERS SIGNING BELOW HAVE FULL POWER
AND AUTHORITY TO ENTER INTO THIS AGREEMENT.
12. Complaints and Investigations
Broker shall cooperate with Inviva in the investigation and settlement of all
complaints or claims against Broker and/or Inviva relating to the solicitation
or sale of the Policies under this Agreement. Broker, Underwriter and Company
each shall promptly forward to the others any complaint, notice of claim or
other relevant information which may come into its possession. Broker,
Underwriter and Company agree to cooperate fully in any investigation or
proceeding in
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order to attempt to achieve a prompt and equitable resolution to all complaints
or claims and to ensure that Broker's, Underwriter's and Company's procedures
with respect to related solicitation or servicing are consistent with any
applicable law or regulation.
13. Each party agrees that all Nonpublic Personal Information obtained in the
performance of duties and obligations under the Agreement shall be held in the
strictest confidence and will not be used for any other purpose except to
perform duties under the Agreement. Such information shall not be disclosed to
any third party without the express written consent of the affected individual
or as may be required by law. Each party will establish procedures to protect
the security and confidentiality of such information. Nonpublic Personal
Information shall mean any financial or health information furnished to the
party, its associates and representatives in the performance of duties or
obligations under this Agreement.
14. All parties to this Agreement hereby agree to comply with all applicable
laws and regulations aimed at preventing, detecting, and reporting money
laundering and suspicious transactions and will take all necessary and
appropriate steps, consistent with applicable regulations and generally accepted
industry practices, to (1) obtain, verify, and retain information with regard to
investor and/or account owner identification and source of funds, and (2) to
maintain records of all account transactions.
Each party to this Agreement also agrees (to the extent consistent with
applicable law) to take all steps necessary and appropriate to provide requested
information about investors and/or accounts to any other party to this Agreement
that shall request such information due to an inquiry or investigation by any
law enforcement, regulatory or administrative authority. To the extent permitted
by applicable law and/or regulation, each party to this Agreement shall notify
all other parties to this Agreement of any concerns that shall arise in
connection with any investor or account holder in the context of relevant
anti-money laundering legislation/regulations. Each party to this Agreement
shall hold harmless all other parties to this Agreement for any actions that may
arise for good faith attempts to comply with all applicable laws, rules and/or
regulations of governmental agencies, law enforcement organizations and/or Self
Regulatory Organizations.
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The effective date of this Selling Agreement with Jefferson National Life
Insurance Company and Inviva Securities Corporation, shall be:
------- ----, ------- -----------------------------------------------
(Month) (Day) (Year) Contract Number (Company Assigned)
Type of Legal Entity: ( ) Individual ( ) Partnership ( ) Corporation
--------------------------------------- -----------------------------------------------
Type or Print Name of Broker-Dealer Taxpayer Identification Number of Broker-Dealer
--------------------------------------- -----------------------------------------------
Type or Print Name of Principal Signature of Principal
--------------------------------------- -----------------------------------------------
Social Security Number of Principal Date
JEFFERSON NATIONAL LIFE INSURANCE COMPANY
--------------------------------------- -----------------------------------------------
Type or Print Name and Title Signature of Officer and Date
INVIVA SECURITIES CORPORATION
--------------------------------------- -----------------------------------------------
Type or Print Name and Title Signature of Principal and Date
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