EXHIBIT 99.3(B)
LIMITED SELLING AGREEMENT
This Limited Selling Agreement is made effective as of May 16, 2001 by and
among XXX Financial Services, Inc., a Maryland corporation (the "Underwriter"),
with administrative offices in Birmingham, Alabama, and Xxxxxxx & Xxxx, Inc., a
Delaware corporation, which is registered as a Broker-Dealer (the "Broker")
under the Securities Exchange Act of 1934, as amended (the "1934 Act"), and is a
member of the National Association of Securities Dealers, Inc. (the "NASD").
WITNESSETH
WHEREAS, United Investors Life Insurance Company, a Missouri corporation
(the "Company") maintains the following segregated accounts for variable annuity
and variable life insurance policies issued by the Company (the "Variable
Contracts"): (i) United Investors Life Variable Account, (ii) United Investors
Advantage Gold Variable Account, (iii) United Investors Annuity Variable Account
and (iv) United Investors Universal Life Account (collectively referred to
hereinafter as the "Variable Accounts"); and
WHEREAS, Broker served as the principal underwriter of the Variable
Contracts pursuant to a Principal Underwriting Agreement between the Broker and
the Company, as amended (the "PUA"), until May 1, 2001, when the Underwriter
became the principal underwriter for Variable Contracts issued on or after
May 1, 2001; and
WHEREAS, the Broker will remain the broker of record for Variable Contracts
it sold prior to May 1, 2001, and is owed and will continue to be owed
compensation from the Company relating to its sales of Variable Contracts; and
WHEREAS, the Underwriter has expressed its position that additional
investments into Variable Contracts sold by the Broker prior to May 1, 2001, may
be considered new sales of variable contracts for purposes of NASD Rule 2820 (e)
and require that a selling agreement be in place between the Underwriter and the
Broker; and
WHEREAS, the Broker disputes the Underwriter's interpretation of NASD Rule
2820 (e) and has taken the position that no selling agreement is required in
order for the Company to pay to the Broker the compensation owed pursuant to the
PUA; and
WHEREAS, in the interests of resolving their dispute, the parties hereto
wish to enter into this agreement for the limited purpose of permitting the
Underwriter to pay to the Broker compensation due to the Broker from the Company
for the sale by the Broker of Variable Contracts that are considered by the
Underwriter to have occurred on or after May 1, 2001.
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NOW, THEREFORE, in consideration of the foregoing and such other good and
valuable consideration, the receipt and sufficiency of which is hereby
acknowledged, the parties hereby mutually agree as follows:
1. Limited Authorization.
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Broker is hereby authorized by the Underwriter to continue to act as
the selling agent only for the limited purpose of servicing the Variable
Contracts and their owners, and to receive compensation owed by the Company
pursuant to the PUA. Broker is not authorized and shall not, after May 1,
2001, sell any new Variable Contracts relating to the Variable Accounts,
except to the extent additional investments in Variable Contracts sold by
Broker prior to May 1, 2001 are considered to constitute new sales.
1.1 Limitation of Authority.
Broker has no authority to:
(a) sell Variable Contracts on behalf of Company, except as
provided herein, in the absence of one or more additional agreements
permitting such sale, or waive any of Company's rights or
requirements;
(b) endorse, cash or deposit any checks or drafts payable to
Company,
(c) open any bank account or trust account on behalf of, for the
benefit of, or containing the name of, Company;
(d) advertise or publish any matter or thing, including use of
the names or logos of Company or the Underwriter or those of their
subsidiaries or affiliates, concerning Company or its Variable
Contracts without prior written permission of Company and the
Underwriter;
(e) do or perform any acts or things on behalf of the Company or
the Underwriter other than expressly authorized herein.
This Agreement shall not create an employer-employee relationship.
The relationship of Broker to Underwriter shall be that of independent
contractor.
1.2 Representation and Service.
Broker agrees:
(a) that Broker will supervise the securities activities of its
registered representatives ("Representatives") with respect to the
limited authorization contained in Section 1 and agrees to establish
such rules and procedures as are necessary to insure compliance with
the terms and conditions of this Agreement
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and with applicable federal and state securities laws and to accept
such supervision;
(b) to comply with the rules and regulations of the Securities
and Exchange Commission ("SEC"), the NASD, and all applicable federal
and state laws relating to the Variable Contracts;
(c) no representations concerning the Variable Contracts will be
made except those contained in the appropriate current prospectuses
and in information supplemental to the prospectuses, which may be
supplied by Underwriter and designated for use with the public. In
this regard, Broker further agrees to refrain from using advertising
or sales literature concerning the Variable Contracts unless and until
it has been approved by Underwriter;
(d) to continue to be fully informed as to the provisions and
benefits of each Variable Contract issued referenced in Section 1; and
to provide all usual and customary service to policyholders.
1.3 Administrative Guidelines; Governmental Authorities
Broker agrees to promptly notify Underwriter or Company in writing of
all contacts and/or correspondence received from insurance regulatory or
other governmental authorities, and to cooperate fully with Underwriter or
Company in making responses to those authorities.
1.4 Return of Premiums.
Broker acknowledges that, subject to the terms of the Variable
Contract, Company has the right in its sole discretion to reject any
Premiums received by it and to return or refund any Premiums.
1.5 Licensing and Registration of Broker and Representative.
(a) Broker represents and warrants that it is a Broker registered
with the SEC under the 1934 Act, and is a member of the NASD in good
standing. Broker must, at all times when performing its functions and
fulfilling it obligations under this Agreement, be duly registered as
a Broker under the 1934 Act and as required by applicable law, in each
state or other jurisdiction in which Broker intends to perform its
functions and fulfill its obligations hereunder.
(b) Broker represents that no individual shall perform any of the
services as authorized in Section 1 unless such individual is an
associated person of Broker (as that term is defined in Section
3(a)(18) of the 0000 Xxx) and duly registered with the NASD and any
applicable state securities regulatory authority as a registered
person of Broker qualified to distribute the Variable Contracts in
such state or jurisdiction. Broker shall be solely responsible for
the background
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investigations of the Representatives to determine their
qualifications and will provide Underwriter upon request with copies
of such investigations.
1.6 Compliance.
Broker hereby represents and warrants that Broker and Representatives
are materially in compliance with all applicable federal and state
securities laws and regulations, and all applicable insurance laws and
regulations. Broker and Representative each shall carry out their
respective obligations under this Agreement in continued compliance with
such laws and regulations.
2. Compensation.
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All compensation payable hereunder to Broker with respect to the
Variable Contracts shall be paid by Company to Broker through Underwriter
and nothing contained herein shall create any right, title or interest in
Underwriter to such compensation. Underwriter agrees to collect from the
Company all compensation due to the Broker relating to sales of Variable
Contracts that are considered by the Underwriter to have occurred on or
after May 1, 2001, and to pay such compensation to the Broker biweekly by
wire transfer in accordance with instructions received from the Broker.
3. Reports.
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Broker represents that it maintains and shall maintain such books and
records concerning the activities of its Representatives as may be required
by the SEC, the NASD and any appropriate insurance regulatory agencies that
have jurisdiction.
4. Notices.
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Any written notice given under any provision of this Agreement shall
be complete upon deposit, postage paid, in the U.S. Mail.
If to Broker:
Xxxxxxx & Xxxx, Inc.
0000 Xxxxx Xxxxxx
Xxxxxxxx Xxxx, Xxxxxx 00000
Attention: Legal Department
If to Underwriter:
XXX Financial Services, Inc.
000 Xxxxxx Xxxxx Xxxxxxx, Xxxxx 000
Xxxxxxxxxx, Xxxxxxx 00000
Attention: Xxxxxxxxxxx X. Xxxxxxx
Xxxxx X. Xxxxxxxx, Xx.
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With copy to:
Xxxxxxx X. Xxxxxxxx, Esq.
Xxxxxxx Xxxxxxxxx Xxxxx & Xxxxxxx, L.L.C.
1200 AmSouth/Xxxxxxx Building
0000 Xxxxx Xxxxxx Xxxxx
Xxxxxxxxxx, Xxxxxxx 00000
5. Miscellaneous.
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5.1 Entire Agreement.
This Agreement is the entire Agreement between the parties for all
dealings after its effective date.
5.2 No Third Party Beneficiary.
This Agreement shall in no way be construed or interpreted to create
any third party beneficiaries. Nothing in this Agreement grants or confers
upon any non-party any rights, privileges or benefits whatsoever. Nothing
in this Agreement imposes any liabilities or obligations whatsoever upon
any party with respect to any non-party.
5.3 No Admission.
Nothing contained herein shall be deemed or construed as an admission
by the Broker that a selling agreement is necessary for the Broker to be
paid the compensation owed by the Company pursuant to the PUA and the
Broker expressly denies that such a selling agreement is required by any
law, statute, rule or regulation.
5.4 No Implied Duty, Representation, Warranty or Cause of
Action.
Except for the duties, representations and warranties expressly set
forth herein, neither party shall deemed to have assumed any implied
obligation or liability and nothing contained herein shall confer upon the
Underwriter or the Broker any implied private cause of action or recourse
against the other party for any violation or alleged violation of any SEC,
NASD, federal or state securities laws, statutes, rules or regulations.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed effective as of the day and year first above written.
XXX FINANCIAL SERVICES, INC.
By: /s/ Xxxxxxxxxxx Xxxxxxx
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Title: President & CEO
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XXXXXXX & XXXX, INC.
By: /s/ Xxxxxx X. Xxxxxxx
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Title: President & CEO
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