EXHIBIT (I)A.(3)(b)
SALES AGREEMENT
1.0 APPOINTMENT
1.1 The Hartford Insurance Company(ies) named in the Sales Agreement
Specifications Page and, with respect to SEC Registered contracts, if
applicable, Hartford Equity Sales Company, Inc., as Principal
Underwriter, (hereinafter collectively referred to as "Company")
hereby appoint the named individual(s) or organization(s) as "Agent"
of Company for the solicitation and procurement of applications for
insurance contracts (hereinafter referred to as "Contracts") in the
line(s) of business set forth in the Sales Agreement Specifications
Page, in all states in which Company is authorized to do business and
in which Agent is properly licensed and appointed, without exclusive
representation.
2.0 AUTHORITY
2.1 Agent has the power or authority to represent Company only to the
extent expressly granted in this Agreement and no further power or
authority is implied.
2.2 Nothing contained herein is intended to create a relationship of
employer and employee between Company and Agent. Agent and, if
applicable, any sub-agents appointed by Agent, shall be independent
contractors as to Company and free to exercise their own judgment as
to the time, place and means of performing all acts hereunder, but
they shall conform to all regulations of Company not unreasonably
interfering with freedom of action or judgment.
2.3 This Agreement terminates all previous Agency agreements, if any,
between Company and Agent. However, the execution of this Agreement
shall not affect any obligations which have already accrued under any
prior agreement.
2.4 Agent does not have the authority to collect premiums for each line of
business, other than initial premiums, unless specifically set forth
in the applicable commission schedule.
2.5 If Agent is listed on the Specification Page as a Broker or General
Agent, Agent is authorized to procure and solicit applications for
Contracts through sub-agents which Agent may appoint with the
approval of Company. No agreement between Agent and any
sub-agent shall impose any liability or obligation upon Company
unless Company is a party thereto in writing. All sub-agents shall
be duly licensed under the applicable insurance laws to sell annuity,
life and health insurance contracts by the proper authorities in the
jurisdictions in which Agent proposes to offer such Contracts. The
sub-agents shall indicate in each application for a Contract that it
has been solicited on behalf of Agent.
2.5.1 Agent shall supervise any sub-agents appointed by Agent to
solicit sales of the Contracts and Agent shall be responsible
for all acts and omissions of each sub-agent within the scope
of his agency appointment at all times. Agent shall exercise
all responsibilities required by the applicable federal and
state law and regulations. Company shall not have any
responsibility for the supervision of any sub-agents of Agent.
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2.5.2 Company may, by written notice to Agent, refuse to permit any
sub-agent to solicit applications for the sale of any of the
Contracts hereunder and may, by such notice, require Agent to
cause any such sub-agent to cease any such solicitation or
sales, and Company may require Agent to cancel the appointment
of any sub-agent with Company.
2.6 If Agent is assigned a different Agent Class for different Lines of
Business, the provisions of this Agreement, which specifically relate
only to a particular Agent Class, shall only apply to Agent in
transacting that Line of Business for which Agent is so classified,
if any.
3.0 COMPENSATION
3.1 Company will pay Agent as full compensation hereunder, commissions
and/or service fees on premiums paid to Company on account of
Contracts issued upon applications procured pursuant to this Agreement
and while this Agreement is in effect.
3.1.1 Commission and/or service fees will be paid in the amounts and
for the periods of time as set forth in the Commission
Schedules included in this Agreement or subsequently made a
part hereof, and which are in effect at the time such
Contracts are sold.
3.1.2 The Commission Schedules included in this Agreement are
subject to change by Company at any time, but only upon
written notice to Agent. No such change shall affect any
Contracts issued upon applications received by Company at
Company's Home Office prior to the effective date of such
change.
3.1.3 Any Commission Schedule included in this Agreement or
subsequently made a part hereof may provide other or
additional conditions regarding compensation and if so, will
be controlling to the extent of the other or additional
conditions.
3.2 Compensation will be earned by Agent only for those
applications accepted by Company, and only after receipt by
Company at Company's Home Office in Hartford, Connecticut,
or at such other location as the Company may designate, from
time to time, in regard to its various lines of business, of
the required premium and compliance by Agent with any
outstanding delivery requirements.
3.2.1 No compensation will be earned or paid on premiums (other than
premiums on health insurance contracts) waived by Company
pursuant to any "waiver of premium" provision.
3.2.2 Should Company for any reason return any premium on a policy
issued hereunder, Agent agrees to repay Company the total
amount of any compensation which may have been paid thereon
within thirty (30) business days of notice of such refund.
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3.3 Any compensation otherwise payable to Agent in accordance with this
Section 3.0 shall be reduced by the amount of such compensation paid
directly, at the direction of Agent, by Company to any person; in
connection with group policies, by the amounts paid by Company to a
resident licensed agent in a state which requires the countersignature
by, or the effectuating of the insurance through, a resident licensed
agent.
3.4 In the event of termination of this Agreement for one or more of the
reasons specified in Subparagraphs 6.2.2 or 6.2.3 below, no further
commissions or other compensation shall thereafter be payable.
3.5 In the event of termination in accordance with subsection 6.1 below
if in any calendar year following such termination the aggregate
commissions payable hereunder for all life and health policies total
less than $100.00, no further commissions shall be payable hereunder,
other references to vesting to the contrary not withstanding.
4.0 GENERAL PROVISIONS
4.1 Agent shall cooperate with Company in the investigation and
settlement of all claims against Agent and/or Company relating to the
solicitation or sale of Contracts under this Agreement. Agent shall
promptly forward to Company any notice of claim or other relevant
information which may come into Agent's possession.
4.2 Agent shall keep full and accurate records of the business transacted
by Agent under this Agreement and shall forward to Company such
reports of said business as Company may prescribe. Company shall have
the right to examine said records at reasonable times. All rate books,
manuals, forms, supplies and any other properties furnished by Company
and in the possession of Agent shall be returned to Company on
termination of this Agreement.
4.3 Agent shall bear all of Agent's expenses incurred in the performance
of this Agreement.
4.4 Agent shall have a duty to obtain applications for Company and, where
appropriate, to conserve and renew coverage placed with Company.
4.5 All applications for the purchase of Contracts shall be subject to
acceptance by Company. Company reserves the right to prescribe
conditions, rules and regulations for the offer and acceptance of its
Contracts, which may be changed from time to time and which shall be
forwarded to Agent.
4.6 Company reserves the right to modify, change or discontinue the
offering of any form of Contract at any time.
4.7 Except in regard to commission schedule changes as stated in
subsection 3.1.2., no waiver or modification of this Agreement will
be effective unless it be in writing and signed by a duly authorized
officer of Company and Agent or a duly authorized officer of Agent.
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4.8 The failure of Company to enforce any provisions of this Agreement
shall not constitute a waiver of any such provision. The past waiver
of a provision by Company shall not constitute a course of conduct or
a waiver in the future of that same provision.
4.9 In the event any legal process or notice is served on Agent in a suit
or proceeding against Company, Agent shall forward forthwith such
process or notice to Company at its Home Office in Hartford,
Connecticut, by certified mail.
4.10 Agent shall not use any advertising material, prospectus, proposal, or
representation either in general or in relation to a Contract of
Company unless furnished by Company or until the consent of Company
shall have been first secured. Agent shall not issue or recirculate
any illustration, circular, statement or memorandum of any sort,
misrepresenting the terms, benefits or advantages of any Contract
issued by Company, or make any misleading statement as to benefits to
be received thereon, or as to the financial position of Company.
4.11 Agent shall indemnify and save Company harmless from any loss or
expense on account of any unauthorized act or transaction by Agent, or
persons employed or appointed by Agent, or any claim by a sub-agent of
Agent for compensation due or to become due on account of such sub-
agent's sale of Contracts.
4.11.1 Agent expressly authorizes Company to charge against all
compensation due or to become due to Agent under this
Agreement any monies paid or liabilities incurred by Company
under this Paragraph 4.11.
4.12 Company shall indemnify and save Agent harmless from any
liability resulting from damages sustained by a policy owner
or certificate owner caused by acts or omissions of Company:
except to the extent Agent's acts or omissions caused such
liability. Indemnification by Company is subject to the
conditions that Agent promptly notify Company of any claim or
suit made against Agent, and that Agent allow Company to make
such investigation, settlement, or defense thereof as Company
deems prudent.
4.13 Except to the extent permitted by law, Agent shall not offer or
pay any rebate of premium or make any offer of any other
inducement not specified in the Contracts of any person to
insure with Company. Agent shall not make any misrepresentation
or incomplete comparison for the purpose of inducting a
policyholder in any other company to lapse, forfeit or
surrender its insurance therein.
4.14 No assignment of this Agreement, or commissions payable
hereunder, shall be valid unless authorized in writing by
Company. Every assignment shall be subject to any indebtedness
and obligation of Agent that may be due or become due to
Company and any applicable state insurance regulations
pertaining to such assignments.
4.15 Company may at any time deduct, from any monies due under this
Agreement, every indebtedness or obligation of Agent to Company
or to any of its affiliates.
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4.15.1 On termination of this Agreement, any outstanding indebtedness
to Company shall become immediately due and payable.
5.0 LIMITATION OF AUTHORITY
5.1 Agent is not authorized, and is expressly forbidden on behalf of
Company, to incur any indebtedness or liability, or to make, alter or
discharge agreements, or to waive forfeitures, extend the time of
payment of any premium, waive payment in cash, or to receive any money
due or to become due Company, except as specifically provided in this
Agreement.
5.2 No individual Contract providing life, health or disability insurance
coverage shall be delivered if a sub-agent or Agent has knowledge that
the health of the proposed insured has changed since the application
was taken or unless the first premium has been fully paid and delivery
made by the delivery date specified by Company or, if no delivery date
is specified, within sixty (60) days from the date said Contract is
mailed from Company's Home Office.
5.2.1 Any Contract not delivered, in accordance with this Subsection
5.2, shall be returned to Company immediately.
6.0 TERMINATION
6.1 This entire Agreement may be terminated by either party by giving
thirty (30) days' notice in writing to the other party.
6.1.1 Such notice of termination shall be mailed to the last known
address of Agent appearing on Company's records, or in the
event of termination by Agent, to the Home Office of Company
at X.X. Xxx 0000, Xxxxxxxx, Xxxxxxxxxxx 00000-0000.
6.1.2 Such notice shall be an effective notice of termination of
this Agreement as of the time the notice is deposited in the
United States mail or the time of actual receipt of such
notice if delivered by means other than mail.
6.2 This Agreement shall automatically terminate without notice upon the
occurrence of any of the events set forth below:
6.2.1 Upon the bankruptcy or dissolution of Agent provided, however,
that if there is more than one Agent, the Agreement shall
automatically terminate only with respect to the bankrupt or
dissolved Agent.
6.2.2 When and if Agent commits fraud or gross negligence in the
performance of any duties imposed upon Agent by this Agreement
or wrongfully withholds or misappropriates, for Agent's own
use, funds of Company, its policyholders or applicants.
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6.2.3 When and if Agent materially breaches this Agreement or
materially violates the insurance or Federal or State
securities laws of a state in which Agent transacts business.
6.2.4 When and if Agent fails to obtain renewal of a necessary
license in any jurisdiction, but only as to that jurisdiction.
6.3 The provisions of Sections 3.0, 4.0 and 5.0 and Subsection 7.5
(if applicable) shall survive the termination of this Agreement,
as appropriate.
7.0 SEC REGISTERED CONTRACTS (If Applicable)
7.1 If Agent is listed on the Specifications Page as a Broker or
General Agent and an NASD registered Broker-Dealer, Agent
agrees that, with respect to SEC Registered Contracts, Agent
has full responsibility for the training and supervision of all
persons, including sub-agents of Agent, associated with
Agent who are engaged directly or indirectly in the offer or sale
of such Contracts and that all such persons shall be subject to the
control of Agent with respect to such persons' activities in
connection with the Contracts. Agent will cause the sub-agents to be
trained in the sale of the Contracts and will cause such sub-agents to
be registered representatives of Agent before such sub-agents engage
in the offer or sale of the Contracts. Agent shall cause Agent's sub-
agents' qualifications to be certified to the satisfaction of Company
and shall notify Company if any sub-agents cease to be registered
representatives of Agent.
7.1.1 Agent will fully comply with the requirements of the National
Association of Securities Dealers, Inc. and of the Securities
Exchange Act of 1934 and all other applicable federal or state
laws and will establish such rules and procedures as may be
necessary to cause diligent supervision of the securities
activities of the sub-agents. Upon request by Company, Agent
shall furnish any records necessary to establish such diligent
supervision.
7.1.2 Before a sub-agent is permitted to solicit and procure
applications for the Contracts, Agent and the sub-agent shall
have entered into an agreement pursuant to which the sub-agent
will be appointed a sub-agent and a registered representative
of Agent and in which the sub-agent will agree that his
selling activities relating to the Contracts will be under the
supervision and control of Agent, and the sub-agent's right to
continue to sell such Contracts is subject to his continued
compliance with such agreement.
7.1.3 In the event a sub-agent fails or refuses to submit to
supervision of Agent in accordance with this Agreement, or
otherwise fails to meet the rules and standards imposed by
Agent, Agent shall immediately notify such sub-agent that he
is no longer authorized to sell the Contracts, and Agent shall
take whatever additional action may be necessary to terminate
the sales activities of such sub-agent relating to the
Contracts including immediate notification of Company of such
termination.
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7.2 If Agent is not an NASD Registered Broker/Dealer but is a member of an
affiliated group of legal entities one of which is an NASD Registered
Broker/Dealer ("Broker/Dealer") and a party to this Agreement, Agent
agrees that, with respect to SEC Registered contracts, the sub-agents
of Agent shall be registered representatives of such Broker/Dealer.
7.2.1 As appropriate, any reference in this Agreement to Agent shall
apply equally to such Broker/Dealer.
7.2.2 Each Agent which is not a Broker/Dealer hereby directs Company
to pay any compensation due, pursuant to Paragraph 3, to the
Broker/Dealer.
7.2.3 If Agent is not a Broker/Dealer but is a member of an
affiliated group of legal entities, one of which is a
Broker/Dealer and a party to this Agreement, Agent and
Broker/Dealer agree that, with respect to SEC Registered
Contracts, Agents and Broker/Dealer have responsibility for
the training and supervision of all registered representatives
of Broker/Dealer and who are sub-agents of Agent and who are
engaged directly and indirectly in the offer or sale of such
SEC Registered Contracts and that all such representatives
shall be subject to the control of Agent and Broker/Dealer
with respect to their activities in connection with the SEC
Registered Contracts.
7.3 If Agent is neither an NASD Registered Broker-Dealer nor a member of
an affiliated group of legal entities one of which is a Broker/Dealer,
Agent and any sub-agents shall be registered representatives of
Hartford Equity Sales Company, Inc.
7.4 The provisions of this Subsection 3.5 do not apply to the sale of SEC
Registered Contracts.
7.5 With respect to SEC Registered Contracts, if Agent is disqualified for
continued registration with the NASD, Company shall not be obligated
to pay any compensation, if such payment would constitute a violation
of NASD rules.
7.6 In respect to SEC Registered Contracts, Agent agrees not to make
written or oral representations except such as are contained in
current prospectuses and authorized supplementary sales literature
made available by Company. Agent also agrees to comply with the
Securities and Exchange Commission Statement of Policy and the
regulations thereunder of the National Association of Securities
Dealers, Inc.
7.7 As to SEC Registered Contracts only, when and if Agent is disqualified
for continued membership with the NASD or registration with the
Securities and Exchange Commission, this Agreement shall automatically
terminate without notice.
7.8 All other provisions of this Agreement apply to the sale of SEC
Registered Contracts.
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