EXHIBIT 1. A(3)(b)
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GENERAL AGENT'S AGREEMENT
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AGREEMENT dated __________________, by and between Lutheran
Brotherhood Securities Corp. hereinafter referred to as "LBSC", a
Pennsylvania corporation, and _____________________ hereinafter referred as
"General Agent", an individual.
WHEREAS, General Agent is a registered representative of LBSC
pursuant to a General Agent's Agreement; and
WHEREAS, General Agent of Lutheran Brotherhood, a Minnesota
Corporation ("LB"), the parent of LBSC, and/or of Lutheran Brotherhood
Variable Insurance Products Company, hereinafter referred to as "LBVIP", a
Minnesota Corporation (collectively known as the "Companies"); and
WHEREAS, LB has the authority to issue variable contracts in certain
states and LBVIP has the authority to issue variable contracts in certain
other states; and
WHEREAS, the parties hereto desire that General Agent represent LBSC
and the Companies in the sale of LB's variable contracts in states where LB
is so authorized and LBVIP's variable contracts in states where LBVIP is so
authorized;
WITNESSETH: In consideration of the mutual promises contained
herein, the parties hereto agree as follows:
A. DEFINITIONS
(1) Contracts - The variable universal life insurance contracts
and variable annuity contracts which the Companies propose to
issue in appropriate states and for which LBSC has been
appointed the principal underwriter pursuant to Distribution
Agreements.
(2) The Variable Accounts - The variable life insurance and
variable annuity separate accounts established and maintained
by the Companies pursuant to the laws of Minnesota to fund
the benefits under the Contracts.
(3) The Fund - An open-end management investment company
registered under the 1940 Act, shares of which are sold to
the Variable Accounts in connection with the sale of the
Contracts.
(4) Registration Statement - The registration statements and
amendments thereto relating to the Contracts, the Variable
Accounts, and the Fund, including financial statements and
all exhibits.
(5) Prospectuses - The prospectuses included within the
registration statements referred to herein.
(6) 1933 Act - The Securities Act of 1933, as amended.
(7) 1934 Act - The Securities Exchange Act of 1934, as amended.
(8) 1940 Act - The Investment Company Act of 1940, as amended.
(9) SEC - The Securities and Exchange Commission.
B. AGREEMENTS OF LBSC
(1) Pursuant to the authority delegated to it by the Companies,
LBSC hereby authorizes General Agent during the term of this
Agreement to solicit and obtain applications for Contracts
directly or through LBSC Registered Representatives obtained
by and holding under General Agent a written selected
Registered Representative Agreement and appointed by the
Companies from eligible persons provided that there is an
effective Registration Statement relating to such Contracts
and provided further that General Agent has been notified by
LBSC that the Contracts are qualified for sale under all
applicable securities and insurance laws of the state or
jurisdiction in which the application will be solicited. In
connection with the solicitation of applications for
Contracts, General Agent is hereby authorized to offer riders
and benefits that are available with the Contracts in
accordance with instructions furnished by LBSC or the
Companies.
(2) LBSC, during the term of this Agreement, will notify General
Agent of the issuance by the SEC of any stop order with
respect to the Registration Statement or any amendments
thereto or the initiation of any proceedings for that purpose
or for any other purpose relating to the registration and/or
offering of the Contracts and of any other action or
circumstances that may prevent the lawful sale of the
Contracts in any state or jurisdiction.
(3) During the term of this Agreement, LBSC shall advise General
Agent of any amendment to the Registration Statement of any
amendment or supplement to any Prospectus.
C. AGREEMENTS OF GENERAL AGENT
(1) It is understood and agreed that General Agent is a duly
registered representative of LBSC pursuant to a General
Agent's Agreement. General Agent agrees to comply with all
of the terms and agreements of said General Agent's Agreement
which is hereby incorporated herein by reference to the
extent it is not inconsistent with the terms herein.
(2) Commencing at such time as LBSC and General Agent shall agree
upon, General Agent agrees to use his/her best efforts to
find purchasers for the contracts acceptable to the
Companies. In meeting his/her obligation to use his/her best
efforts to solicit applications for Contracts, General Agent
shall, during the term of this Agreement, engage in the
following activities:
(a) Continuously utilize training, sales and promotional
materials which have been approved by the Companies;
(b) Permit periodic inspection and supervision of his/her
sales practices and submit periodic reports to LBSC as
may be requested on the results of such inspections
and the compliance with procedures.
(c) General Agent shall not make recommendations to an
applicant to purchase a Contract in the absence of
reasonable grounds to believe that the purchase of the
Contract is suitable for such applicant. While not
limited to the following, a determination of
suitability shall be based on information furnished to
General Agent after reasonable inquiry of such
applicant concerning the applicant's insurance and
investment objectives, financial situation and needs,
and the likelihood that the applicant will continue to
make the premium payments contemplated by the
Contract.
(3) All payments for Contracts collected by General Agent shall
be held at all times in a fiduciary capacity and shall be
remitted promptly in full together with such applications,
forms and other required documentation to the Companies as
designated by LBSC. Checks or money orders in payment of
initial premiums shall be drawn to the order of "Lutheran
Brotherhood" or "Lutheran Brotherhood Variable Insurance
Products Company", whichever is appropriate. General Agent
acknowledges that the Companies retain the ultimate right to
control the sale of the Contracts and that LBSC or the
Companies shall have the unconditional right to reject, in
whole or in part, any application for the Contract. In the
event the Companies or LBSC rejects an application, the
Companies immediately will return all payments directly to
the purchaser and General Agent will be notified of such
action. In the event that any purchaser of a Contract elects
to return such Contract in accordance with the Contract's
free look provision, any amounts paid will be refunded
pursuant to the law of the state in which the purchaser
resides and General Agent will be notified of such action.
General Agent will comply with Lutheran Brotherhood's policy
on Field Force Fiduciary Responsibility.
(4) General Agent shall act at all times as an independent
contractor in carrying out the duties hereunder and shall not
be considered an employee of the Companies or LBSC except for
the purposes of the Federal Insurance Contributions
Act (26 U.S.C. 3101, ET. SEQ.) and Title II of the Social
Security Act (42 U.S.C.401, ET. SEQ.). As such General
Agent shall have full control of his or her daily activities,
with the right to exercise independent judgment as to the
time, place, and manner of soliciting applications, servicing
Contracts, and otherwise carrying out the provisions of this
Agreement. General Agent and his/her employees and
Registered Representatives obtained by and holding under
General Agent shall not hold themselves out to be employees
of the Companies or LBSC in this connection or in any
dealings with the public.
(5) General Agent agrees that any material he or she develops,
approves or uses for sales, training, explanatory or other
purposes in connection with the solicitation of applications
for Contracts hereunder (other than generic advertising
materials which do not make specific reference to the
Contracts) will not be used without the prior written consent
of LBSC and, where appropriate, the endorsement of the
Companies to be obtained by LBSC.
(6) Solicitation and other activities by General Agent shall be
undertaken only in accordance with applicable laws and
regulations. General Agent shall not solicit applications
for the contracts until duly licensed and appointed by the
Companies as a life insurance and variable contract agent of
the Companies in the appropriate states or other
jurisdictions. General Agent shall fulfill any training
requirements necessary to be licensed. General Agent
understands and acknowledges that he/she is not authorized by
LBSC or the Companies to give any information or make any
representation in connection with this Agreement or the
offering of the Contracts other than those contained in the
Prospectus or other solicitation material authorized in
writing by LBSC or the Companies.
(7) General Agent shall not represent himself or herself as
having any nor shall he or she have authority on behalf of
LBSC or the Companies to: make, alter or discharge any
Contract or other form; waive any forfeiture, extend the time
of paying any premium, or to alter, waive, or forfeit any of
the rights of the Companies or LBSC; receive any moneys or
premiums due, or to become due, to the Companies, except as
set forth in Section C(3) of this Agreement. General Agent
shall not expend, nor contract for the expenditure of the
funds of LBSC or the Companies, nor shall General Agent
possess or exercise any authority on behalf of LBSC or the
Companies by this Agreement.
(8) General Agent shall maintain such records as are required of
him/her by applicable laws and regulations. The books,
accounts and records of the Companies, the Variable Accounts,
LBSC and General Agent relating to the sale of the Contracts
shall be maintained so as to clearly and accurately disclose
the nature and details of the transactions. All records
maintained by General Agent in connection with this Agreement
shall be the property of LBSC or the Companies and shall be
returned to LBSC or the Companies upon termination of this
Agreement, free from any claims or retention of rights by
General Agent. General Agent shall keep confidential any
information obtained pursuant to this Agreement and shall
disclose such information, only if LBSC or the Companies has
authorized such disclosure, or if such disclosure is
expressly required by applicable federal or state regulatory
authorities.
(9) All business produced and serviced under this Agreement is
the property of LBSC or the Companies and no attempt will be
made by General Agent to prejudice the Contract Owners or
interfere with the collection of premiums or transfer any
existing Contracts to another company or organization.
Information regarding names, addresses, ages and all other
information and records of Contract owners acquired from the
Companies of LBSC and coming into the possession of General
Agent during the effective period of this Agreement, or any
prior Agreement, are trade secrets wholly owned by the
Companies. All forms and other material, including
electronic data, whether furnished by the Companies or LBSC
or purchased by General Agent, upon which this information is
recorded shall be the sole and exclusive property of the
Companies. General Agent shall return any part or all of
such information and records upon the request of the
Companies or LBSC. General Agent will safeguard and protect
all such information within his or her control from any
unauthorized access and use.
(10) The Companies and LBSC may furnish to General Agent, without
charge, certain manuals, forms, records, electronic data, and
such other materials and supplies as they may deem advisable
to provide. All such property furnished by them shall remain
the property of the Companies. In addition, they may offer
at General Agent's expense such additional materials and
supplies as they believe may be helpful to General Agent.
(11) The expense of any office, including rental, furniture, and
equipment; signs; supplies not furnished by the Companies or
LBSC; the salaries of the employees of General Agent;
automobile; transportation; telephone; postage; advertising;
and all other charges or expense incurred by General Agent in
the performance of this Agreement shall be incurred at
his/her discretion and paid for by him/her.
(12) General Agent expressly covenants and agrees that after
termination of this Agreement, for any reason, he/she shall
not for a period of one year thereafter, nor shall he/she
assist, encourage or induce others to do, any of the
following things: induce, or attempt to induce, any of the
Contract owners to whom he/she or any Registered
Representative in his/her General Agency was assigned while
this Agreement was in effect, to cancel, lapse, or surrender
their contracts with the Companies.
(13) Upon termination of this Agreement, General Agent will
deliver to the Companies, or its authorized representatives,
all records, materials, supplies, advertising, licenses, and
all other documents pertaining to the Companies, used in
carrying out this Agreement.
(14) General Agent will, at the option of the Companies or LBSC,
furnish a fidelity bond for such sum and with such surety as
they may require.
(15) General Agent shall maintain an errors and omissions
insurance policy in an amount, form, and surety acceptable to
the Companies for the performance of his or her professional
services, duties, and obligations.
D. COMPENSATION
(1) Pursuant to the Distribution Agreement between LBSC and the
Companies, LBSC shall cause the Companies to arrange for the
payment of commissions to General Agent as compensation for
the sale of each contract sold by General Agent or Registered
Representative obtained by and holding under General Agent.
The amount of such compensation shall be based on a schedule
to be determined by agreement of the Companies and LBSC.
(2) General Agent shall have no right to withhold or deduct any
part of any premium he/she shall receive for purposes of
payment of commission or otherwise. General Agent shall have
no interest in any compensation paid by the Companies to
LBSC, now or hereafter, in connection with the sale of any
Contracts hereunder.
(3) The Companies are hereby given a paramount and prior lien and
security interest upon any commissions payable under or as a
result of this or any previous agreement and under all
agreements amendatory hereof or supplementary hereto, as
security for the payment of any claim or indebtedness or
reimbursement whatsoever due or to become due to LBVIP, LBSC,
LB or any of its subsidiaries or affiliates, from General
Agent. Any sums becoming due to General Agent at any time
may be applied, directly, by the Companies to the liquidation
of any indebtedness or obligation of General Agent to any of
the secured parties, but the failure to so apply any sum
shall not be deemed a waiver of the Companies' lien on or
security interest in any other sums becoming due nor impair
its right to so apply such sums.
(4) Notwithstanding the vesting provisions provided for in the
Distribution Agreement and/or the schedule referred to in
section D(1) herein, General Agent will forfeit all
compensation and any other payments which have otherwise been
vested or reserved to General Agent by this or any previous
or related Agreement, if this Agreement terminates and any of
the following events have occurred or subsequently occur:
(a) General Agent engages in any form of rebating,
directly or indirectly, or if General Agent defaults
in the payment to the Companies of any premiums
collected by him/her, demands or accepts any
remuneration from a Contract Owner, beneficiary, or
their representative for services in connection with
the payment of any claim under any contract issued by
the Companies;
(b) General Agent fails to deliver to the Companies or
their authorized representative any of the following:
all records, including electronic data, materials,
supplies, advertising, licenses, and all other
documents containing the Companies' confidential
information and/or trade secrets, upon the written
request of the Companies;
(c) General Agent violates any of the applicable federal
and state laws, regulations or rules, or commits any
fraud, in connection with his or her duties as a
General Agent or as a registered representative; or
(d) General Agent violates any of the covenants set forth
in section C(12) herein.
E. COMPLAINTS AND INVESTIGATIONS
General Agent and LBSC jointly agree to cooperate fully in any
insurance regulatory investigation or proceeding or judicial
proceeding arising in connection with the contracts marketed under
this Agreement. General Agent and LBSC further agree to cooperate
fully in any securities regulatory investigation or proceeding or
judicial proceeding with respect to General Agent, LBSC, or their
affiliates and their agents or representatives to the extent that
such investigation or proceeding is in connection with Contracts
marketed under this Agreement.
F. TERM OF AGREEMENT
(1) This Agreement shall continue in force for one year from its
effective date and thereafter shall automatically be renewed
every year for a further one year period; provided that
either party may unilaterally terminate this Agreement upon
thirty (30) days' written notice to the other party of its
intention to do so.
(2) Upon termination of this Agreement, all authorizations,
rights and obligations under this agreement shall cease
except (a) the agreements contained in Section E hereof;
(b) the indemnity set forth in Section G hereof; (c) the
obligations to settle accounts hereunder, including payments
on premiums subsequently received for Contracts, in effect at
the time of termination or issued pursuant to applications
received by General Agent prior to termination; and (d) the
covenants set forth in Sections C(9), C(12) and C(13).
(3) This Agreement will automatically terminate on the first day
of the month next following the seventieth birthday of
General Agent.
(4) In the event that the General Agent's Agreement between
General Agent and Lutheran Brotherhood or the General Agent's
Agreement between General Agent and LBSC is terminated, this
Agreement will also terminate.
(5) LBSC may immediately terminate this agreement for breach of
any of the covenants and agreements herein by General Agent.
G. INDEMNITY
(1) General Agent shall be held to the exercise of reasonable
care in carrying out the provisions of this Agreement.
(2) General Agent agrees to indemnify and hold harmless the
Companies and LBSC and each of their current and former
directors and officers and each person, if any, who controls
or has controlled the Companies or LBSC within the meaning of
the 1933 Act or the 1934 Act, against any losses, claims,
damages or liabilities to which the Companies or LBSC and any
such director or officer or controlling person may become
subject, under the 1933 Act or otherwise insofar as such
losses, claims, damages or liabilities (or actions in respect
thereof) arise out of or are based upon:
(a) Any unauthorized use of sales materials or any verbal
or written misrepresentations or any unlawful sales
practices concerning the Contracts by General Agent;
or
(b) The failure of General Agent, his/her employees or
Registered Representatives obtained by and holding
under General Agent, to comply with the provisions or
this Agreement; and General Agent will reimburse the
Companies, LBSC, or such director, officer or
controlling person in connection with investigating or
defending any such loss, claims, damage, liability or
action. This indemnity agreement will be in addition
to any liability which General Agent may otherwise
have.
H. GENERAL TERMS
(1) This Agreement shall not be assigned by either party without
the written consent of the other.
(2) This Agreement shall be governed by and construed in
accordance with the laws of the State of Minnesota.
(3) The forbearance or neglect of LBSC to insist upon strict
compliance by General Agent with any of the provisions of
this Agreement, whether continuing or not, shall not be
construed as a waiver of LBSC's rights or privileges
hereunder. No waiver of any right or privilege of LBSC
arising from any default or failure of performance by General
Agent shall affect LBSC's rights or privileges in the event
of a further default or failure of performance.
(4) Whenever required for proper interpretation of this
Agreement, the singular number shall include the plural, the
plural the singular, and the use of any gender shall include
all genders.
(5) The unenforceability or invalidity of any provisions hereof
shall not render any other provision or provisions herein
contained unenforceable or invalid.
(6) This Agreement contains the entire understanding of the
parties hereto, and no modification hereof or addition hereto
shall be binding unless the same is in writing and signed by
the parties hereto.
(7) This Agreement shall be binding upon and inure to the benefit
of the parties hereto, and their respective successors and
permissive assigns, and General Agent's estate, heirs and
personal representatives.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed as of the day and year first above written.
LUTHERAN BROTHERHOOD
SECURITIES CORP.(LBSC)
By
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(General Agent)
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