Conseco Equity Sales, Inc. Group Selling Agreement
CONSECO VARIABLE INSURANCE COMPANY
CONSECO EQUITY SALES, INC.
GROUP SELLING AGREEMENT
This Agreement is made between Conseco Variable Insurance Company ("Company"),
Conseco Equity Sales, Inc. ("Underwriter") with Administrative Offices in
Carmel, Indiana, and the Broker-Dealer named herein registered as a
Broker-Dealer ("Broker") and a member of the National Association of Securities
Dealers, Inc. (the "NASD"). The parties do hereby agree as follows:
1. Authorization.
Broker, either an individual, partnership, or corporation, is hereby authorized
by Company and Underwriter to solicit applications for variable annuity policies
("Policies"), as set forth in the Compensation Schedule which is made a part of
the Group Selling Agreement, to collect and remit initial required premiums to
Company, and to deliver Policies issued by Company:
a. only in jurisdictions where Broker is duly licensed and appointed by
the appropriate regulatory agencies, and;
b. only in states or 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.
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
required premium;
c. endorse, cash or deposit any checks or drafts payable to Company;
d. open any bank account or trust account on behalf of, for the benefit
of, or containing the name of, Company;
e. advertise or publish any matter or thing, including use of the names
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 of
Company and Underwriter or registered representatives of Underwriter
to terminate or alter its/his contract with Company, or induce or
attempt to induce any policyholder of Company to relinquish,
surrender, replace or lapse a Policy; or
g. 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 shall indemnify and hold harmless Company, Underwriter, and their
affiliates from any and all claims, demands, penalties, suits, or actions, and
from any and all losses, costs, and expenses in connection therewith, including
attorney's fees and expenses, arising out of or resulting from sales of the
Policies by or through the Broker, or from the default in the performance of, or
in the negligent performance of, by Broker or Broker's partners, directors,
officers, employees or agents, the obligations of Broker under this Agreement.
In addition, Broker agrees to furnish and maintain a satisfactory bond of
indemnity when requested by Company, a copy of such bond to be submitted to
Company within 30 days of request. The provisions of this paragraph shall
survive the termination of this Agreement.
1.2. Representation and Service.
Broker agrees:
a. that Broker will supervise the securities activities of Broker's with
respect to the sale of the Policies and agrees to establish such rules
and procedures as are necessary to insure compliance with applicable
federal and state securities laws and to accept such supervision;
b. to observe the rules, procedures and other directives established, and
given by Underwriter relating to the sale of the Policies by Broker,
as initially set forth in the Broker-Dealer Manual which Underwriter
must provide, provided, however, that provision of the Broker-Dealer
Manual shall not be deemed to imply a duty of supervision by Company
or Underwriter over Broker, or to relieve Broker of it's duty to
supervise its personnel. Broker will also comply with the rules and
regulations of the Securities and Exchange Commission and the NASD
relating to the sale and distribution of the Policies and will observe
all applicable federal and state laws relating to the Policies;
c. that all solicitations for Policies are accompanied by the appropriate
current prospectuses for the Policies conforming to the requirements
of the Securities Act of 1933;
d. 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 to refrain from using 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 effort
to maintain in force any business placed with Company; and
h. to hold in a fiduciary capacity all premiums received with any
applications for Policies solicited for Company.
1.3. Broker's Agents.
Broker will recruit, train and supervise registered representatives
("Representatives") for the sale of the Policies. Appointment of each
Representative shall be subject to Company's prior approval. Company may require
termination of any Representative's authority to sell the Policies. Broker is
responsible for the Representatives' compliance with the terms and conditions of
this Agreement and for the Representatives being duly licensed pursuant to
applicable state and federal laws.
1.4. Delivery of Policy.
Broker shall promptly deliver all issued Policies in accordance with Company
rules.
1.5. Administrative Guidelines and Compliance.
Company's administrative guidelines, including bulletins, product and procedure
updates, the revisions, additions and amendments thereto, from the time made by
Company, shall be for all purposes a part of this Agreement as fully as if set
out word for word herein and 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, and to cooperate fully with Company in making responses to those
authorities.
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 service fees 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 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
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 change shall be applicable to Policies for which
Company has accepted premiums prior to the effective date of such change.
2.2. Accounting.
Company will give to Broker a monthly statement of all compensation becoming due
and payable since the date of the previous monthly statement. 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.
3. Indebtedness.
Company shall have a first lien upon any amounts due, or to become due, Broker
for 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.
3.1. Guarantee.
If Broker is a corporation or partnership, the principal(s) signing this
Agreement on behalf of Broker jointly and severally guarantee to repay to
Company any indebtedness Company is unable to collect from Broker. Should it
become necessary to take legal action to recover such indebtedness, the
principal(s) jointly and severally agree to be responsible for the reasonable
attorney fees and expenses of Company.
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, when Broker or Broker's
partner, director, officer, employee or agent has, or is reasonably
believed to have: (i) misappropriated funds from any policyowner or
from Company; (ii) endeavored to induce Brokers of Company and
Underwriter or registered representatives of Underwriter to leave its
services or policyowners 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 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 to prejudice materially the interest of
Company in breach of this Agreement. 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 to no longer 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 in the
event of:
1. default under this Agreement; or
2. Broker or Broker's associated person's failure to timely and
fully comply with Company directives, rules, regulations or
manuals.
e. Ownership Change. This Agreement will terminate if Broker is not a
natural person and 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.
5. Previous Agreement.
By execution of this Agreement, any prior agreement 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.
6. Entire Agreement.
This Agreement, including any supplements and the Compensation Schedule(s), is
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.
7. 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.
8. 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.
9. 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 Noblesville, Xxxxxxxx
County, Indiana. Venue for arbitration hearing shall be in Xxxxxxxx County,
Indiana.
10. Construction
THIS AGREEMENT SHALL BE CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
INDIANA EXCLUSIVE OF CHOICE OF LAWS PROVISIONS.
The effective date of this Group Selling Agreement with Conseco Variable
Insurance Company and Conseco Equity Sales, Inc., shall be:
______________________________ _______________, _______________.
(Month) (Day) (Year)
_____________________________________________ Check Type of Legal Entity:
Contract Account Number (Assigned by Company) [ ] Individual [ ] Partnership
[ ] Corporation (Note: If Partnership or
Corporation two different
signatures are necessary)
_____________________________________________
Type or Print Name of Broker/Dealer
_____________________________________________
Taxpayer Identification Number of Broker/Dealer
_____________________________________________ _____________________________________________
Type or Print Name of Principal Type or Print Name of Principal
______________________________________________ ______________________________________________
Signature of Principal Signature of Principal
_____________________________________________ ______________________________________________
Social Security Number of Principal Social Security Number of Principal
Conseco Variable Conseco Equity Sales, Inc.
Insurance Company
By: ________________________________________ By: ________________________________________
Authorized Signature Authorized Signature
________________________________________ ________________________________________
Type or Print Name Type or Print Name
________________________________________ ________________________________________
Title Title
________________________________________ ________________________________________
Date Date
