1
EXH-3(b)
SELLING AGREEMENT
FOR VARIABLE CONTRACTS
THIS AGREEMENT, effective ____________________, is made by TOWER SQUARE
SECURITIES, INC., (hereafter referred to as TSSI) as the Distributor, and
_________________________________________________________________________,
(hereafter referred to as Broker/Dealer).
TSSI and the Broker/Dealer enter into this agreement for the purpose of
authorizing the Broker/Dealer, through its licensed individual agents as
described in paragraph 3, to solicit applications for such variable life
insurance, variable annuity and modified guaranteed annuity contracts (the
"Contract(s)") as may be issued by The Travelers Insurance Company, the
Travelers Life and Annuity Company and any affiliated companies (hereafter
referred to as the Insurance Companies), and identified by policy form in the
Compensation Schedules relating to this agreement as such schedules may be
amended from time to time. The parties represent and agree as follows:
1. The Insurance Companies are engaged in the issuance of the
Contracts in accordance with federal securities laws and the
applicable insurance laws of those states in which the
Contracts have been qualified for sale. The Contracts may be
considered securities under the Securities Act of 1933;
therefore, distribution of the Contracts is made through TSSI
as a registered Broker/Dealer under the Securities Exchange
Act of 1934 and as a member of the National Association of
Securities Dealers, Inc. ("NASD"). The terms of the offering
of the Contracts are more particularly described in the
Prospectus(es) for the Contracts.
2. The Broker/Dealer certifies that it is a registered
Broker/Dealer under the Securities Exchange Act of 1934 and a
member of the NASD. The Broker/Dealer agrees to abide by all
rules and regulations of the NASD and to comply with all
applicable state and federal laws and the rules and
regulations of the authorized regulatory agencies affecting
the sale of the Contracts.
3. The Broker/Dealer will select persons whom it will employ and
supervise and who will be trained and qualified to solicit
applications for the Contracts in conformance with applicable
state and federal laws and regulations. Persons so trained
and qualified will be registered representatives of the
Broker/Dealer in accordance with the rules of the NASD and
they will be properly licensed in accordance with the state
insurance laws of those jurisdictions in which the Contracts
may lawfully be distributed and in which they solicit
applications for such Contracts. The Insurance Companies
shall have ultimate authority to determine whether they shall
appoint or terminate a particular registered representative as
an agent of the Insurance Companies with the various state
insurance departments.
4. The Broker/Dealer will review all contract proposals and
applications for suitability and for completeness and
correctness as to form. The Broker/Dealer will promptly, but
in no case later than the end of the next business day
following receipt by the Broker/Dealer, forward to the
applicable Insurance Company, at addresses provided, all
applications found suitable and in good form, together with
any payments received with such applications without deduction
or reduction. The Broker/Dealer will immediately return to
the applicant all applications together with any payments
received therewith deemed by the Broker/Dealer to be
unsuitable or not complete and correct as to form. The
Insurance Companies reserve the right to reject any Contract
application and return any payment made in connection with an
application which is rejected. Contracts issued on
applications accepted by the Insurance Companies will be
forwarded to the Broker/Dealer or at the direction of the
Broker/Dealer to the registered representative for delivery to
the Contract Owner. The Broker/Dealer shall obtain and retain
a receipt for each Contract which the Broker/Dealer delivers.
2
2
5. The Broker/Dealer will perform the selling functions required
by this Agreement only in accordance with the terms and
conditions of the then current prospectus(es) applicable to
the Contract and will make no representations not included in
the prospectus or in any authorized supplemental material. No
sales solicitation, including the delivery of supplemental
sales literature or other such materials, shall occur, be
delivered to, or used with a prospective purchaser unless
accompanied or preceded by appropriate and then-current
prospectus(es). Any material prepared or used by the
Broker/Dealer or its registered representative, which
describes in whole or in part or refers by name or form to any
of the Insurance Companies' Contracts or underlying funds or
uses the name of the Insurance Companies, TSSI, or The
Travelers Group, Inc., or the logos or service marks of any of
them, or the name, logos or service marks of any "Affiliated
Company" of any of them, as that term is defined in Section
2(a)(2) of the Investment Company Act of 1940, must be
approved by TSSI in writing prior to any such use.
6. Compensation payable to the Broker/Dealer on sales of the
Contracts solicited by the Broker/Dealer will be paid to the
Broker/Dealer, or as necessary to meet any and all legal
requirements, to a licensed insurance affiliate, in accordance
with the Compensation Schedule(s) relating to this agreement
as they may be amended from time to time and are in effect at
the time the Contract payments are received by the applicable
Insurance Company (in the case of annuities) or at the time
the applications are received (in the case of life insurance).
In the event compensation is paid to the licensed insurance
agency affiliate as described in the preceding sentence, such
payment will be reflected in the Broker/Dealer's "Focus"
reports, and in its fee assessment reports filed with the
NASD. The Insurance Companies and TSSI reserve the privilege
of revising the Compensation Schedules at any time.
7. If the Insurance Companies return all or a portion of a
premium paid with respect to a Contract, Broker/Dealer shall
be obligated to refund to TSSI applicable commissions on the
amount of such premium only where:
(a) the Contract solicited is returned not taken under
the policy "free look" provisions;
(b) premiums are refunded due to overpayments, errors in
billing or in the timing of automatic premium
collection deductions, or errors resulting in policy
reissue;
(c) the check delivered in payment of any contract
premium does not clear and the premium collection
deductions, or errors resulting in policy reissue;
(d) the Contract is terminated or there is a refund of
premium and an act, error or omission of the
Broker/Dealer or its registered representative
materially contributed to the termination of the
Contract or the need to return premium;
(e) the application is rejected by the Insurance Company;
(f) the Insurance Company is directed by a judicial or
regulatory authority to return premium without
assessment of a surrender charge;
(g) the applicant's initial premium on a 1035 exchange is
returned because the expected rollover amount from
another Contract is not transferred due to the
exchange not meeting the legal requirements to
qualify for a tax-free exchange;
(h) the Insurance Company returns unearned premium on a
life insurance contract as required by the provisions
of the contract;
3
3
(i) the Insurance Company determines that it has a legal
liability to return premiums on a life insurance
contract within the first year after the Contract is
issued; or
(j) the Insurance Company and Broker/Dealer mutually
agree to return all or a portion of a premium paid
with respect to a Contract.
8. If any Contract is repurchased at any time or if within
forty-five (45) days after confirmation by the Insurance
Companies of any premium payments credited to a Contract, that
Contract is tendered for full or partial surrender, or the
life at risk thereunder dies, then, at the option of the
Insurance Companies or TSSI no commission will be payable with
respect to said premium payments and any commission previously
paid for said premium payments must be refunded to the
applicable Insurance Company or TSSI as directed by TSSI.
TSSI agrees to notify the Broker/Dealer within ten (10)
business days after the request for repurchase or redemption,
or notification or death of the life at risk is received by
the applicable Insurance Company.
9. This Agreement may not be assigned except by mutual consent
and will continue, subject to the termination by any party on
written notice to the other party, except that in the event
the Broker/Dealer ceases to be a registered Broker/Dealer or a
member of the NASD, this Agreement will immediately terminate.
TSSI reserves the right to designate, at its sole discretion,
an alternative Principal Underwriter for the distribution of
the Contracts covered by this Agreement. The designation will
constitute substitution of parties to this Agreement with
assumption of the rights and obligations created by this
Agreement as applicable.
10. Failure of any party to terminate this Agreement for any of
the causes set forth in this agreement will not constitute a
waiver of the right to terminate this Agreement at a later
time for any of these causes.
11. For the purpose of compliance with any applicable federal or
state securities laws or regulations promulgated under them,
the Broker/Dealer acknowledges and agrees that in performing
the Broker/Dealer services covered by this Agreement, it is
acting in the capacity of an independent broker and dealer as
defined by the By-Laws of the NASD and not as an agent or
employee of either TSSI or any registered investment company.
The Broker/Dealer represents and warrants that it is
authorized and licensed as an agent under applicable state
insurance laws to solicit, negotiate and effect the contracts
of insurance contemplated hereunder. In the event the
Broker/Dealer is not licensed as such, an insurance agency
affiliated with the Broker/Dealer shall be licensed as an
agent under applicable state insurance laws to solicit,
negotiate and effect the contracts of insurance contemplated
hereunder.
For the purpose of compliance with any applicable state
insurance laws or regulations promulgated under them, the
Broker/Dealer acknowledges and agrees that solely in
performing the insurance-selling functions reflected by this
agreement, it or its registered representative is acting as
the agent of the Insurance Companies, and in that capacity is
authorized only to solicit applications from the public for
the Contracts. Such Contracts will not become effective until
such applications are accepted after underwriting review by
the Insurance Companies at their Home Office.
In furtherance of its responsibilities as a Broker/Dealer, the
Broker/Dealer acknowledges that it is responsible for
compliance on any business it produces concerning the
Contracts. No Broker/Dealer will be entitled to compensation
with respect to any application for or payment credited to,
any Contract(s) that is rejected by the Insurance Companies in
the event the Insurance Companies or TSSI determine the
solicitation or obtaining of purchasers, applications or
payments by the Broker/Dealer or any of its Associated persons
was done in
4
4
violation of the securities or insurance laws of the United
States or any state or other jurisdiction.
No party to this Agreement will be liable for any obligation,
act or omission of the other. Each party to this Agreement
will hold harmless and indemnify the (1) Registered Investment
Companies which are used to fund the Contracts, (2) Insurance
Companies, (3) TSSI, and (4) the Broker/Dealer, as
appropriate, for any loss or expense suffered as a result of
the violation or noncompliance by that party or the Associated
persons of that party of any applicable law or regulation or
any provision of the Agreement; provided, however, that no
party or any of its employees or agents will be liable to the
other party for any direct, special or consequential damages
arising out of or in connection with the performance of any
services pursuant to the Agreement.
12. All notices to the Insurance Companies or TSSI relating to
this Agreement should be sent to the attention of The
Travelers Insurance Companies, FS Law Department, Xxx Xxxxx
Xxxxxx, Xxxxxxxx, XX 00000. All notices to the Broker/Dealer
will be duly given if mailed or faxed to the address shown
below.
13. The terms "Associated Person", "member" and "rules of the
Corporation" as used herein shall be defined consistently with
the definition of similar terms as contained in Article I of
the NASD By-Laws. This Agreement will be construed in
accordance with the laws of the State of Connecticut.
In reliance on the representations set forth and in consideration of the
undertakings described herein, the parties represented below do hereby contract
and agree.
TOWER SQUARE SECURITIES, INC. The Broker/Dealer
By:
------------------------------ ----------------------------------
Title:
------------------------------ ----------------------------------
Street Address
Date:
------------------------------ ----------------------------------
By:
------------------------------
Title:
--------------------------
Taxpayer I.D.:
--------------------------
Date:
--------------------------
Fax:
--------------------------
XXXX-XXX.xx
