Exhibit 3(a)(ii)
AMENDED AND RESTATED
DISTRIBUTION AGREEMENT
BETWEEN CUNA MUTUAL INSURANCE SOCIETY AND
CUNA BROKERAGE SERVICES, INC. FOR VARIABLE ANNUITY CONTRACTS
THIS AGREEMENT is made effective as of the 1st day of January, 2008 by and
between CUNA Mutual Insurance Society (CMIS), a mutual life insurance company
domiciled in the State of Iowa with its principal office located in Waverly,
Iowa, and CUNA Brokerage Services, Inc. (CUNA Brokerage), a registered
broker-dealer domiciled in the State of Wisconsin with its principal office
located in Waverly, Iowa.
WHEREAS, CUNA Mutual Life Insurance Company entered into a Distribution
Agreement for variable annuity contracts with CUNA Brokerage dated as of January
1, 1997, pursuant to which the terms under which CUNA Brokerage would serve as
principal underwriter and distributor for the variable annuity contracts of CUNA
Mutual Life Insurance Company were delineated;
WHEREAS, effective December 31, 2007, CUNA Mutual Life Insurance Company merged
with and into CMIS; and
WHEREAS, in light of the merger, the parties desire to amend the Distribution
Agreement.
NOW, THEREFORE, for good and valuable consideration, the parties agree as
follows:
ARTICLE 1
APPOINTMENT
1.1 CMIS appoints CUNA Brokerage to be the principal underwriter and
distributor for all of CMIS's variable annuity contracts which require
distribution under the auspices of a registered broker-dealer.
ARTICLE 2
DUTIES OF CUNA BROKERAGE
2.1 REGISTRATION UNDER THE 1934 ACT
CUNA Brokerage is registered as a broker-dealer under the provisions of the
Securities Exchange Act of 1934 (1934 Act) and has secured and will
maintain authorizations, licenses, qualifications, and permits necessary to
perform its obligations under this Agreement in those states requested by
CMIS.
2.2 MEMERSHIP IN THE FINANCIAL INDUSTRY REGULATORY AUTHORITY
CUNA Brokerage currently holds and shall maintain a membership in the
Financial Industry Regulatory Authority (FINRA).
2.3 RESPONSIBILITY FOR SECURITIES ACTIVITIES
CUNA Brokerage shall assume full responsibility for the securities
activities of all persons engaged directly or indirectly in the
distribution operations for CMIS's variable annuity products, including but
not limited to training, supervision, and control as contemplated under
appropriate provisions of the 1934 Act and regulations thereunder and by
the rules of FINRA. All persons directly or indirectly involved in such
variable annuity securities activities shall be registered representatives
or registered principals of CUNA Brokerage as appropriate to their
activities. Also, each registered representative selling the product and at
least one registered principal shall be properly licensed as an insurance
agent of CMIS.
Further, CUNA Brokerage represents and warrants that during the term of
this Agreement, it will maintain and implement (a) policies and procedures
designed to comply with all applicable rules of FINRA, including but not
limited to rules relating to suitability of variable annuity
recommendations, (b) a training program for its registered representatives
designed to ensure that such persons gather information concerning a
customer's financial status, tax status, investment objective and other
relevant information prior to recommending the purchase or exchange of a
variable annuity contract, and (c) a reasonable system of sales supervision
designed to achieve compliance with the rules of FINRA. CUNA Brokerage
agrees to provide a report to CMIS upon request, certifying that CUNA
Brokerage is in compliance with items (a) through (c) above. Each such
report shall be certified by a senior manager of CUNA Brokerage who has
responsibility for items (a) through (c). CUNA Brokerage understands and
acknowledges that CMIS may conduct an inspection and/or audit of CUNA
Brokerage on a periodic basis to ensure compliance with items (a) through
(c) above, and CUNA Brokerage agrees to make reasonable accommodation to
CMIS to enable CMIS to inspect documents directly related to the sale and
suitability of any CMIS variable annuity product, which documents CUNA
Brokerage shall be responsible for maintaining.
2.4 APPOINTMENT OF REGISTERED PERSONS AND MAINTENANCE OF PERSONNEL RECORDS
CUNA Brokerage shall have the authority and responsibility for the
appointment and registration of those persons who will be registered
representatives and registered principals. CUNA Brokerage shall direct the
maintenance of all personnel records of such persons.
2.5 MAINTENANCE OF NET CAPITAL
CUNA Brokerage shall maintain required net capital at levels which will
comply with maximum aggregate indebtedness provisions under the provisions
of the 1934 Act, any regulation thereunder, and any FINRA rules
2.6 REQUIRED REPORTS
CUNA Brokerage shall have the responsibility for preparation and submission
of any reports or other materials required by any regulatory authority
having proper jurisdiction.
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2.7 LIMITATION ON AUTHORITY
CUNA Brokerage is not authorized to give any information or to make any
representations concerning the variable annuity contracts of CMIS other
than the statements contained in the current registration statement filed
with the Securities and Exchange Commission or such sales literature as may
be authorized by CMIS.
ARTICLE 3
DUTIES OF CMIS
3.1 MAINTENANCE OF ACCOUNTING RECORDS
Except as set for above, CMIS shall maintain and hold, on behalf of and as
agent for CUNA Brokerage, those records pertaining to variable annuity
contracts required to be maintained and preserved by the 1934 Act, any
regulations thereunder, and any applicable FINRA rules. All such books and
records are, and shall at all times remain, the property of CUNA Brokerage
and shall at all times be subject to inspection by duly authorized
officers, auditors, and representatives of CUNA Brokerage and by the
Securities and Exchange Commission, FINRA, and other regulatory authorities
having proper jurisdiction.
3.2 CONFIRMATION OF TRANSACTIONS
On behalf of CUNA Brokerage and acting as agent for CUNA Brokerage, CMIS
shall confirm all transactions required to be confirmed in the form and
manner required by the 1934 Act, any regulations thereunder, and any FINRA
rules.
3.3 FURNISHING MATERIALS
CMIS shall furnish to CUNA Brokerage copies of prospectuses, financial
statements and other documents which CUNA Brokerage reasonably requests for
use in connection with the solicitation, sale and distribution of CMIS's
variable annuity contracts.
ARTICLE 4
COMPENSATION
4.1 As compensation for services to be performed pursuant to this Agreement,
CMIS shall pay a dealer concession to and on behalf of CUNA Brokerage. The
amount of the dealer concession and the manner in which it will be paid is
specified in Schedule A to a related contract titled "Amended and Restated
Servicing Agreement Related to the Distribution Agreement between CUNA
Mutual Insurance Society and CUNA Brokerage Services, Inc. for Variable
Annuity Contracts."
ARTICLE 5
TERMINATION
5.1 This Agreement may be terminated at any time by either party upon written
notice to the other stating the date when such termination shall be
effective, provided that this Agreement may not be terminated or modified
by either party if the effect would be to put CUNA Brokerage out of
compliance with the "net-capital" requirements of the 1934 Act. Default of
any kind shall not have the effect of terminating this Agreement.
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IN WITNESS WHEREOF, the undersigned, as duly authorized officers, have caused
this Agreement to be executed on behalf of their respective companies.
CUNA MUTUAL INSURANCE SOCIETY
BY: /s/Xxxxxx X. Xxxxxxx
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Xxxxxx X. Xxxxxxx
VP and Associate General Counsel
CUNA BROKERAGE SERVICES, INC.
BY: /s/Xxxx X. Xxxxxx
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Xxxx X. Xxxxxx
President
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