EXHIBIT 3(b)
Broker/Dealer Agreement between American International Life Assurance
Company of New York and American International Fund Distributors, dated
August 1, 1988
BROKER-DEALER AGREEMENT
IT IS HEREBY AGREED by and between American International Life
Assurance Company of New York (hereinafter referred to as "INSURANCE COMPANY"),
a New York Corporation, and American International Fund Distributors, Inc.
(hereinafter referred to as "BROKER/DEALER"), a New York Corporation, as
follows:
I.
BASIS FOR THE AGREEMENT
A. INSURANCE COMPANY
INSURANCE COMPANY is a life insurance company licensed to issue various
life insurance policies and annuity contracts.
B. BROKER/DEALER
BROKER/DEALER is an affiliate of INSURANCE COMPANY. BROKER/DEALER will
function as a broker-dealer registered under the provisions of the
Securities Exchange Act of 1934 (hereinafter referred to as the
"Exchange Act") for the sale of certain variable contracts issued by
separate accounts of INSURANCE COMPANY. Such variable contracts may be
deemed to be securities within the meaning of the Securities Act of
1933 and will be registered thereunder.
C. PURPOSE OF AGREEMENT
INSURANCE COMPANY desires BROKER/DEALER to act as the distributor for
all of the said variable contracts which require distribution under the
auspices of a registered broker-dealer. The parties desire INSURANCE
COMPANY to maintain certain accounting books and records of
BROKER/DEALER and to send purchasers of such variable contracts
required confirmations of transactions on behalf of BROKER/DEALER and
to pay any commissions which may be due on sales of such variable
contracts to any selling broker-dealers.
II.
DUTIES OF BROKER/DEALER
A. REGISTRATION UNDER THE EXCHANGE ACT
BROKER/DEALER is registered as a broker-dealer under the provisions of
the Exchange Act and will secure whatever authorizations, licenses,
qualifications, permits and the like as may be necessary to perform its
obligations under this agreement in those states requested by INSURANCE
COMPANY.
B. MEMBERSHIP IN THE NATIONAL ASSOCIATION OF SECURITIES DEALERS, INC.
BROKER/DEALER is a member of the National Association of Securities
Dealers, Inc. ("NASD"), and shall maintain its membership therein.
C. RESPONSIBILITY FOR SECURITIES ACTIVITIES
BROKER/DEALER shall assume full responsibility for the securities
activities of all persons engaged directly or indirectly in the
variable contract operations of INSURANCE COMPANY, including but not
limited to training, supervision and control as contemplated under
appropriate provisions of the Exchange Act, any regulations thereunder,
or by the rules of the NASD. The the extent necessary and appropriate,
those persons directly or indirectly involved in such variable contract
operations shall be registered representatives or registered principals
of BROKER/DEALER as appropriate to their activities.
D. APPOINTMENT OF REGISTERED PERSONS AND MAINTENANCE OF PERSONNEL RECORDS
BROKER/DEALER shall have the authority and responsibility for the
appointment and registration of those persons who will be registered
representatives and registered principals. BROKER/DEALER shall likewise
have the responsibility for maintenance of all of the appropriate
records of such registered persons.
E. MAINTENANCE OF NET CAPITAL
BROKER/DEALER shall have the full responsibility for maintenance of
appropriate net capital and for limiting aggregate indebtedness as may
be required under the provisions of the Exchange Act, and regulations
thereunder, or by NASD rules.
F. REQUIRED REPORTS
BROKER/DEALER shall have the responsibility for preparation and
submission of any reports or other materials required by any regulatory
authority having proper jurisdiction.
III.
DUTIES OF INSURANCE COMPANY
A. MAINTENANCE OF ACCOUNTING RECORDS
INSURANCE COMPANY shall be responsible for the maintenance of all books
and records in connection with the said variable contracts. Such books
and records shall be maintained and preserved in conformity with any
requirements under the Exchange Act, any regulations thereunder, or
under NASD rules to the extent that such requirements are applicable to
variable contract operations. All such books and records shall be
maintained and held by INSURANCE COMPANY on behalf of and as agent for
BROKER/DEALER. All such books and records are, and shall at all times
remain, the property of BROKER/DEALER and shall at all times be subject
to inspection by duly authorized officers, auditors or representatives
of BROKER/DEALER and by the Securities and Exchange Commission, the
NASD, or other regulatory authority having proper jurisdiction.
B. PAYMENT OF COMMISSIONS
INSURANCE COMPANY shall pay on behalf of BROKER/DEALER all commissions
which may be due on sales of such variable contracts to any selling
broker-dealers and registered representatives of BROKER/DEALER who are
also licensed insurance agents (or agencies) of INSURANCE COMPANY. Such
commissions shall be payable from funds made available for such and
shall be subject to approval before payment by duly authorized
personnel of BROKER/DEALER. The payment of commisisions hereunder on
behalf of BROKER/DEALER is intended by the parties to be a purely
ministerial act by INSURANCE COMPANY and all such payments shall be
properly reflected on the books and records maintained on behalf of
BROKER/DEALER.
C. CONFIRMATION OF TRANSACTIONS
INSURANCE COMPANY shall provide that confirmations will be issued on
behalf of BROKER/DEALER, acting as agent for INSURANCE COMPANY,
regarding all transactions required to be confirmed, and in the form
and manner required for such confirmations, under the Exchange Act, any
regulations thereunder, or by NASD rules.
D. PAYMENT OF EXPENSES OF BROKER/DEALER
In the event BROKER/DEALER should expend any of its own funds for any
reason, INSURANCE COMPANY shall reimburse BROKER/DEALER upon demand.
INSURANCE COMPANY'S obligations under the terms of this paragraph shall
be limited by BROKER/DEALER in performance of services for INSURANCE
COMPANY.
E. PROVISIONS OF FACILITIES AND PERSONNEL
INSURANCE COMPANY shall provide BROKER/DEALER with facilities and
personnel sufficient to perform BROKER/DEALER's obligations hereunder
and to carry on its business in conformity with provisions of the
Exchange Act, any regulations thereunder or NASD rules.
IV.
TERMINATION
This Agreement may be terminated at any time by either party upon 60
days written notice to the other provided that this Agreement may not
be terminated or modified by either party if the effect would be to put
BROKER/DEALER out of compliance with the "net capital" requirements of
the Exchange Act. In addition, no default of any kind shall have the
effect of terminating this Agreement unless such termination is subject
to this termination provision.
EXECUTED at New York, New York effective August 1, 1988.
INSURANCE COMPANY
AMERICAN INTERNATIONAL LIFE
ASSURANCE COMPANY OF NEW YORK
/s/ A. Xxxxxxx Xxxxxxxx
By: _____________________________
A. Xxxxxxx Xxxxxxxx, President
/s/ Xxxxxxx X. Xxxxx
ATTEST:______________________________
Secretary
BROKER/DEALER
AMERICAN INTERNATIONAL FUND
DISTRIBUTORS, INC.
/s/ Xxxxxx X. Xxxxxxxxx
By: ______________________________
Xxxxxx X. Xxxxxxxxx, President
/s/ Xxxxxxx X. Xxxxx
ATTEST: _____________________________
Secretary
