Exhibit 1. (3)(b)
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Proposed form of Selling Agreement
SELLING AGREEMENT
This is an Agreement by and between Walnut Street Securities, Inc. (hereafter
referred to as "Company"), and (hereafter referred
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to as "Broker-dealer").
Premises
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A. Company is a principal underwriter for variable annuity and
variable life insurance contracts (the "Contracts") issued by
General American Life Insurance Company ("General American"),
which contracts are registered as securities with the
Securities and Exchange Commission and are subject to the
various regulations pertaining to securities as well as to the
laws governing insurance and annuity contracts.
B. Broker-dealer certifies that it is registered and in good
standing as a broker-dealer under the Securities Exchange Act
of 1934 and is a member in good standing of the National
Association of Securities dealers (the "NASD"), and desires to
become authorized to sell the Contracts.
In consideration of and reliance on the premises and the covenant set forth
below, the parties hereto agree as follows:
1) Basic Engagement Company hereby agrees that Broker-
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dealer is authorized to sell the Contracts. Broker-
dealer hereby agrees to conduct all selling
activities in respect of the Contracts in accordance
with the rules and regulations of the NASD and all
applicable State and Federal laws, rules, and
regulations.
2) Broker - dealer's Duties
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a. Broker-dealer will ensure that individuals
conducting sales activities relating to the
Contracts are duly appointed insurance agents
of General American and entitled to sell the
Contracts under insurance laws of any
jurisdiction in which the individual solicits
sales.
b. Broker-dealer will ensure that sales of the
Contracts do not occur in jurisdictions where
General American is not licensed to sell the
Contracts.
c. Broker-dealer will ensure that individuals
conducting sales activities relating to the
Contracts possess the qualifications
specified by the N.A.S.D. and federal laws and
regulations.
d. Broker-dealer will supervise the sales
practices of its agents and hereby
indemnifies and holds Company harmless from
any damage or expense caused by any wrongful
act by Broker-dealer and its agents in
selling the Contracts.
3) Suitability Broker-dealer will review all
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applications for the Contracts to make certain that
the purchase is suitable for the prospective
customer. Broker-dealer will promptly forward to
Company all applications for the Contracts which it
deems
suitable, together with any purchase payments
received, without making any deduction for
compensation of the selling agent or of Broker-dealer
itself. General American and Company have the right
to make their own determination concerning the
acceptability of any application for a Contract and
to return any purchase payment tendered in connection
therewith.
4) Sales Material The Contracts are described in
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prospectuses and the mutual fund into which premiums
may be directed is described in a prospectus. Broker-
dealer will offer and sell the Contracts only in
accordance with the terms and conditions of the then
current prospectuses and will make no representations
not made in the prospectuses or in any authorized
supplemental sales materials approved by Company and
General American. Broker-dealer shall not use or
permit use of advertising or sales material without
obtaining the prior written approval of General
American.
5) Independent Contractor Broker-dealer is performing
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the acts covered by this Agreement in the capacity of
independent contractor and not as an agent or
employee of Company or General American. Neither
Company nor General American shall be liable for any
obligation, act or omission of Broker-dealer.
6) Compensation Broker-dealer shall be paid by General
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American (on behalf of Company) compensation for the
sale of Contracts as set forth in the attached
Compensation Schedule. General American has the right
to charge back any such compensation under the
conditions stated in such Schedule(s). Any
Compensation Schedule can be changed by Company and
General American as of a specified date, provided
such date is at least 10 days after the date notice
of the change is mailed to Broker-dealer's last known
address. Any such change will apply only to Contracts
issued on or after the effective date of the change.
7) Effectiveness This Agreement shall take effect as of
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the date it is signed by Company, which date is shown
below. It shall continue in force from year to year
unless it is terminated. This Agreement may be
terminated for any reason by either party, such
termination will become effective 60 days after the
mailing of a notice of termination to the other
parties' last known addresses. This Agreement may be
terminated by Company for cause (i.e., Broker-
dealer's violation of any of the terms of this
Agreement); such termination will become effective
upon the mailing of a notice of termination to the
Broker-dealer's last known address. Failure of
Company to terminate this Agreement upon knowledge of
a cause shall not constitute a waiver of the right to
terminate at a later time for such cause. This
Agreement shall immediately terminate automatically
if Broker-dealer shall cease to be a member of the
NASD or to possess the requisite licenses and
appointments, and
Broker-dealer agrees to immediately notify Company of
such an occurrence.
8) No Assignment Agreement may not be assigned by
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Broker-dealer except with the written consent of
Company.
9) Applicable Law This Agreement shall be construed in
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accordance with the laws of Missouri.
IN WITNESS WHEREOF, the Company has caused this Agreement to be
executed in its corporate name by one of its corporate officers, and
the Broker-dealer has set its hand to this Agreement as of the day and
year written below.
Broker-dealer Walnut Street Securities, Inc.
"COMPANY"
Signature: BY:
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Address: Name:
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Title:
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Address:
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Dated: Effective Date:
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COMPENSATION SCHEDULE FOR
VARIABLE LIFE INSURANCE CONTRACTS
AND VARIABLE ANNUITY CONTRACTS ISSUED BY
GENERAL AMERICAN LIFE INSURANCE COMPANY
1. Broker-dealer shall be paid a fraction of the premium received and accepted
by General American under an issued variable life policy or variable annuity
contract for which an agent of Broker-dealer solicited the application. The
exact amount of compensation shall be determined by the terms of the agent's
contract between Broker-dealer and General American. Notwithstanding the above,
no compensation will be paid on a premium that represents in whole or in part
the surrender or loan proceeds of any life insurance policy or annuity contract
issued by General American.
2. No commission will be paid until a valid receipt for delivery of the policy
or contract is received by General American.
3. In the event any variable life policy is surrendered within twelve policy
months of its date of issue, any compensation amount previously paid to Broker-
dealer with respect to the amount surrendered will be deducted from any
compensation otherwise due Broker-dealer as follows: 100% if surrender occurs
during the first six policy months and 50% if surrender occurs during the
seventh through the twelfth months. If any amount to be deducted exceeds
compensation otherwise due, Broker-dealer shall promptly pay back the amount of
the excess following a written demand by Company or General American.
4. If the agreement to which this compensation schedule applies terminates, no
further payments of any kind will be made to Broker-dealer.
