Exhibit 99.A3.B
Exhibit 24(b)(3)(c)
Broker/Dealer Selling Agreement
BROKER-DEALER SELLING AGREEMENT
This Broker-Dealer Selling Agreement (the "Agreement") is made this 1st
day of November, 2001, by and among AFSG Securities Corporation ("AFSG"), AUSA
Life Insurance Company, Inc. ("AUSA"), and Janus Distributors, Inc. ("JDI").
RECITALS
WHEREAS, AFSG, a broker-dealer registered with the Securities and
Exchange Commission ("SEC") under the Securities Exchange Act of 1934 ("1934
Act") and a member of the National Association of Securities Dealers, Inc.
("NASD"), is the principal underwriter of a certain variable annuity known as
Janus Annuity - New York (the "Contract") that is offered by its affiliate,
AUSA, a life insurer;
WHEREAS, JDI is a broker-dealer registered with the SEC under the 1934
Act and a member of the NASD and is duly authorized to solicit, market and sell
the Contract in the State of New York;
WHEREAS, AFSG proposes to have certain registered representatives of
JDI who have been licensed and appointed as life insurance agents of AUSA, and
have become associated with World Financial Group Insurance Agency, Inc.
("WFGIA"), or its associated insurance agencies or principal agents (such
registered representatives hereafter referred to as "Representative-Agents") to
solicit and sell the Contract in the State of New York, and JDI desires to sell
such Contract, through the Representative-Agents, in such states or
jurisdictions, on the terms and conditions set forth hereinafter;
WHEREAS, each Representative-Agent shall be a dual employee of WFGIA
and JDI and shall be supervised by WFGIA and JDI pursuant to the Coordination
and Supervisory Agreement dated November 1, 2001;
WHEREAS, JDI is affiliated with Janus Capital Corporation ("Janus
Capital") which has established and serves as investment adviser to Janus Aspen
Series, an open-end investment company designed to serve as an underlying
investment medium for the Contracts and for other variable annuity contracts or
variable life insurance policies;
WHEREAS, AUSA, AFSG, and Janus Capital have entered into a Master
Agreement dated as of November 1, 2001, as may be amended from time to time,
regarding each party's respective functions with regard to the Contracts (the
"Master Agreement");
WHEREAS, AUSA and Janus Aspen Series entered into a Participation
Agreement dated as of November 1, 2001, as may be amended from time to time,
regarding each party's functions with regard to the Contracts (the
"Participation Agreement");
NOW THEREFORE, in consideration of the mutual covenants herein
contained, the parties agree as follows:
1. APPOINTMENT.
a. AUSA authorizes WFGIA, and AFSG hereby authorizes JDI to cause
the Representative-Agents to sell the Contract in the states
and jurisdictions in which JDI and the Representative-Agents
are appropriately licensed, registered or otherwise qualified
and in which the Contract is duly authorized to be sold. In
addition to the Contracts, Representative-Agents may continue
to solicit investors for securities and insurance products
distributed by JDI, its affiliates and others in their
capacities as registered representatives of JDI.
b. JDI agrees to use its best efforts to solicit and sell the
Contract and perform the other functions set forth herein. JDI
shall provide the office space, support personnel, office
equipment, and other resources as may be reasonably necessary
for the Representative-Agents to solicit and sell the
Contracts. JDI shall be free to exercise its own discretion as
to whom to solicit and the time, place, and means of
performing its duties under this Agreement.
2. SUPERVISION OF REPRESENTATIVE-AGENTS BY JDI. JDI, with respect to
securities law related activities, shall have full responsibility for
the training and supervision of all Representative-Agents associated
with JDI who are engaged directly or indirectly in the offer or sale of
the Contract and all such persons shall be subject to the control of
JDI with respect to such persons' securities related activities in
connection with the Contract. JDI will establish rules, procedures and
supervisory techniques necessary to diligently supervise the activities
of the Representative-Agents.
JDI will use its best efforts to cause such Representative-Agents to
qualify under applicable federal and state securities laws to engage in
the sale of the Contract, will cause such Representative-Agents to be
registered representatives of JDI before such Representative-Agents
engage in the solicitation of applications for the Contract, will
provide each of the Representative-Agents with a copy of its compliance
manual, and will cause such Representative-Agents to limit solicitation
of applications for the Contract to jurisdictions where AUSA or AFSG
has authorized such solicitation.
JDI shall certify Representative-Agents' qualifications, including
certifying a General Letter of Recommendation set forth in Exhibit A to
this Agreement.
3. COMPLIANCE WITH NASD RULES OF FAIR PRACTICE AND FEDERAL AND STATE
SECURITIES AND INSURANCE LAWS. AFSG and JDI shall fully comply with the
requirements of the 1934 Act and all other applicable federal or state
laws applicable to the solicitation and service of the Contract.
4. RECORDS. JDI agrees to maintain appropriate books and records
concerning the activities of the Representative-Agents in connection
with the offering and sale of the Contracts as required by the 1934
Act, the NASD Rules of Fair Practice, and any other applicable
securities laws or regulations. Any party shall readily provide such
records or disclosures pertaining to sales, conduct or commissions
under this Agreement, as may be required by court order or law or by
any regulatory or self-regulatory authority to which any party is
subject. Management of AUSA, WFGIA, AFSG, and JDI, their designated
agents, and all regulatory bodies having jurisdiction over them, shall
have
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unimpeded access at all times to all records maintained in connection
with the offering and sale of the Contracts pursuant to this Agreement.
5. PROSPECTUS, SALES PROMOTION MATERIAL AND ADVERTISING. (a) Prospectus.
JDI shall forward to the Representative-Agents, Contract prospectuses
and such other materials AFSG and AUSA determine to be necessary or
desirable for use in connection with sales of the Contract. (b) Sales
Material and Advertising. JDI shall ensure that no sales promotion
materials or advertising related to the Contract shall be used by
Representative-Agents in connection with the sale of any Contract
unless the specific item has been approved in the manner and by the
specified parties as provided in the Master Agreement and the
Participation Agreement. (c) Responsibility for Filing Sales Literature
and Advertising with NASD. As between AFSG and JDI, the party
developing and publishing the respective sales literature or
advertising relating to the Contracts shall be responsible for filing
it with the NASD. The allocation under this Agreement of the
responsibility to file such materials with the NASD does not waive in
any way the review and approval of such material by the various parties
as required under the Master Agreement and the Participation Agreement.
6. APPLICATIONS. JDI shall cause all applications for the Contract to be
made on application forms supplied by AUSA, and all payments collected
by JDI or any Representative-Agent to be remitted promptly in full,
together with such application forms and any other documentation
directly to AUSA at the address indicated on such application. JDI
shall review all such applications for completeness. Checks or money
orders in payment on any such Contract shall be drawn to the order of
AUSA. Applications are subject to rejection by AUSA if not in good
order. JDI agrees to remit in full to AUSA promptly upon receipt, all
premiums received on such applications, forms and any other required
documentation obtained in respect of participants in the Contract. AFSG
and AUSA represent and warrant that all Contracts are legally issued,
registered and filed as required by applicable federal securities and
state insurance laws in all jurisdictions authorized by AUSA and AFSG.
7. COMPENSATION. No compensation shall be due to any party or any
Representative-Agent from any other party under this Agreement. Each
party shall pay all expenses incurred by it hereunder.
8. INVESTIGATIONS. AUSA, AFSG, and JDI agree to cooperate fully in any
investigation or proceeding with respect to any Representative-Agent to
the extent that such investigation or proceeding is in connection with
the Contract. Without limiting the foregoing:
a. AFSG or AUSA will promptly notify JDI of any substantive
customer complaints or notice of any regulatory investigation
or proceeding or judicial proceeding received by it or any of
its affiliates with respect to JDI or any Representative-Agent
in connection with the Contract of any activity in connection
therewith.
b. JDI will promptly notify AFSG and/or AUSA of any substantive
customer complaints or notice of any regulatory investigation
or proceeding or judicial
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proceeding received by JDI with respect to JDI or any
Representative-Agent in connection with the Contract or any
activity in connection therewith.
c. In the case of a substantive customer complaint in connection
with the Contract, AUSA, AFSG, and JDI will cooperate in
investigating such complaint. However, any response thereto
affecting or involving the rights or obligations of AUSA under
the Contract shall be the sole responsibility of AUSA.
9. INDEMNIFICATION. JDI agrees to hold AFSG and AUSA harmless and
indemnify AFSG and AUSA against all loss, claims, attorneys' fees and
expenses that result from breach of this Agreement by JDI or from any
negligent, fraudulent, or intentional acts, omissions or errors of JDI,
its employees, its agents, or the Representative-Agents in the
performance of any services or duties hereunder or related in any way
to this Agreement.
AFSG and AUSA agree to hold JDI harmless and indemnify JDI against all
loss, claims, attorneys' fees and expenses that result from breach of
this Agreement by AFSG or AUSA or from any negligent, fraudulent, or
intentional acts, omissions or errors of AFSG or AUSA, their employees,
and their agents in the performance of any services or duties hereunder
or related in any way to this Agreement.
Without limiting the foregoing indemnities, each party to this
Agreement agrees to indemnify and hold harmless the other against any
breach of representation, warranty or covenant herein by the
indemnifying party.
10. TERMINATION.
a. AFSG may terminate this Agreement immediately and without
notice if JDI fails to maintain its registration as a
broker-dealer under the 1934 Act or a member of the NASD.
b. Each party to this Agreement may terminate this Agreement upon
written notice to the other party if the other party breaches
any material provision of this Agreement and fails to cure
such breach within thirty (30) days of the written notice.
c. Each party to this Agreement shall have the right, upon thirty
(30) days' written notice to the other parties, to terminate
this Agreement for whatever reason deemed appropriate by such
party.
d. This Agreement shall terminate simultaneously with the earlier
of the termination of the Master Agreement or of the
Coordination and Supervisory Agreement.
e. Notwithstanding the termination of this Agreement, AFSG and
JDI acknowledge that each of them shall be individually and
respectively liable, responsible and accountable for any and
all action undertaken prior to the effective date of the
termination of this Agreement.
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f. Notice of termination shall be deemed to be given on the day
mailed or delivered by hand to an officer of either party.
11. FIDELITY BOND. JDI shall secure and maintain a fidelity bond in at
least the amount prescribed under Article III, Section 32 of the NASD
Rules of Fair Practice.
12. INDEPENDENT CONTRACTORS. AFSG and JDI enter into this Agreement as
independent contractors and nothing contained in this Agreement and no
act done under this Agreement shall be construed as establishing a
partnership, joint venture, or principal-agent relationship among the
parties.
13. ASSIGNMENT. None of the parties to this Agreement may assign this
Agreement without the prior written approval of the other parties.
14. CONFIDENTIALITY. Each party will keep confidential information it may
acquire as a result of this Agreement regarding AFSG and JDI and their
affiliates' affairs. The parties agree that ownership of or rights to
any customer list or other propriety information that either party may
acquire in the performance of this Agreement shall be governed by the
Master Agreement.
15. NOTICES. All notices hereunder are to be made in writing and shall be
given:
if to AFSG, to: 000 Xxxxxxxx Xxxxxxx
Xx. Xxxxxxxxxx, XX 00000
Attn: Xxxx X. Xxxxxx, Esq.
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if to JDI, to: 000 Xxxxxxxx Xxxxxx
Xxxxxx, XX 00000
Attn: General Counsel
if to AUSA, to: 000 Xxxxxxxx Xxxxxxx
Xx. Xxxxxxxxxx, XX 00000
Attn: Xxxx X. Xxxxxx, Esq.
16. COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which taken together shall constitute one and the
same instrument.
17. SEVERABILITY. This is a severable Agreement. In the event that any
provisions of this Agreement would require a party to take action
prohibited by applicable federal or state law or prohibit a party from
taking action required by applicable federal or state law, then it is
the intention of the parties hereto that such provisions shall be
enforced to the extent permitted under the law, and, in any event, that
all other provisions of this Agreement shall remain valid and duly
enforceable as if the provision at issue had never been a part hereof.
18. SURVIVAL. The provisions of Sections 9, 10, 14 and 17 of this Agreement
shall survive termination of this Agreement.
19. GOVERNING LAW. This Agreement shall be interpreted in accordance with
the laws of the State of Colorado.
20. HEADINGS. The sections and other headings contained in this Agreement
are for reference purposes only and shall not affect the meaning or
interpretation of any provisions of this Agreement.
21. AMENDMENT. This Agreement may not be amended except by a writing signed
by each of the parties hereto.
22. CODE OF PROFESSIONAL CONDUCT. JDI agrees to comply with the concepts in
AUSA's Code of Professional Conduct and agrees to maintain policies and
procedures to reasonably assure that its Representatives comply with
those concepts.
23. USE OF AUSA POLICY ADMINISTRATION COMPUTER SYSTEM. AUSA receives and
processes applications, premium payments, transfers, redemptions
(including surrenders and withdrawals) and all other financial
transactions relating to each pending, issued and terminated Contract,
and maintains on AUSA's policy administration computer system (the
"System") records of all applications, purchases, transfers,
redemptions and other transactions regarding each Contract. JDI and
AUSA agree as follows:
a. AUSA agrees JDI is an authorized user of the System and has
full and continuous on-line access to the System, including
all records contained in the System relating to each
Contract's transactions.
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b. JDI has determined that the System contains the data and
records relating to each Contract which are required to be
kept by JDI pursuant to Rule 17a-3 under the 1934 Act as
applicable to JDI's sale of the Contracts.
c. All policy transactions relating to the Contracts are
available in the System. JDI shall have access to such data.
JDI is authorized to produce and deliver any such data,
records, registers, summaries or other reports in the System
relating to the Contracts to the SEC, NASD or other regulatory
authority having jurisdiction over JDI with respect to the
Contracts.
d. AUSA agrees to maintain the records and data in the System and
provide JDI with on-line access for at least two years from
the date of a transaction, and AUSA will maintain and provide
back-up files from its system for at least six years from the
date of a transaction.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
signed by their respective officials thereunto duly authorized, as of the day
and year first above written.
Attest: AFSG SECURITIES CORPORATION
By: /s/ Xxxx X. Xxxxxx
--------------------------- ---------------------------------
Name: Xxxx X. Xxxxxx
---------------------------------
Title: Vice President
---------------------------------
Attest: JANUS DISTRIBUTORS, INC.
/s/ Xxxxx Xxxxxx By: /s/ Xxxxxx X. Xxxx
--------------------------- ---------------------------------
Name: Xxxxxx X. Xxxx
---------------------------------
Title: Vice President
---------------------------------
AUSA LIFE INSURANCE COMPANY,
Attest INC.
By: /s/ Xxx X. Xxxxxxxxxxx
--------------------------- ------------------------------------
Name: Xxx X. Xxxxxxxxxxx
------------------------------------
Title: Chairman of the Board and President
------------------------------------
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EXHIBIT A TO BROKER-DEALER SELLING AGREEMENT
GENERAL LETTER OF RECOMMENDATION
JDI hereby certifies to AFSG and AUSA that all the following
requirements will be fulfilled in conjunction with the submission of
licensing/appointment papers for all applicants submitted by JDI. JDI will, upon
request, forward proof of compliance with same to AFSG in a timely manner. "We"
refers to JDI.
1. We have made a thorough and diligent inquiry and investigation
relative to each applicant's identity, residence and business
reputation and declare that each applicant is personally known
to us, has been examined by us, is known to be of good moral
character, has a good business reputation, is reliable, is
financially responsible and is worthy of a license. Each
individual is trustworthy, competent and qualified to hold
himself out in good faith to the general public in connection
with the Contracts.
2. We have on file a U-4 form which was completed by each
applicant. We have fulfilled all the necessary investigative
requirements for the registration of each applicant as a
registered representative through our NASD member firm, and
each applicant is presently registered as an NASD registered
representative.
The above information in our files indicates no fact or
condition which would disqualify the applicant from receiving
a license and all the findings of all investigative
information is favorable.
3. We certify that all educational requirements have been met for
the specified state each applicant is requesting a license in,
and that all such persons have fulfilled the appropriate
examination, education and training requirements.
4. If the applicant is required to submit his picture, his
signature, and securities registration in the state in which
he is applying for a license, we certify that those items
forwarded to AUSA are those of the applicant and the
securities registration is a true copy of the original.
5. We hereby warrant that the applicant is not applying for a
license with AUSA in order to place insurance chiefly and
solely on his life or property, or lives or property of his
relatives, or property or liability of his associates.
6. We will not permit any applicant to directly or indirectly
solicit Contracts unless AUSA has advised JDI the applicant is
duly licensed and appointed to do so.
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