EXHIBIT 99-B.3.3
BROKER-DEALER AGREEMENT DATED JUNE 7, 2000 BETWEEN AETNA LIFE INSURANCE AND
ANNUITY COMPANY AND AETNA INVESTMENT SERVICES, INC.
ALIAC BROKER-DEALER AGREEMENT
THIS AGREEMENT ("Agreement") is effective as of this 7th day of June, 2000, by
and between Aetna Life Insurance and Annuity Company (the "Company"), 000
Xxxxxxxxxx Xxxxxx, Xxxxxxxx, Xxxxxxxxxxx 00000, incorporated under the laws of
the State of Connecticut, and Aetna Investment Services, Inc. (the
"Broker-Dealer"), incorporated under the laws of Connecticut.
In consideration of the mutual promises contained herein, the parties hereto
agree as follows:
ARTICLE I AGREEMENTS OF THE COMPANY
1.1. The Company hereby authorizes the Broker-Dealer during the term of this
Agreement to solicit, offer and sell to suitable customers the products
("Products") (including individual and group annuity contracts,
certificates for individual participants under group contracts and
other products) described in the Schedules attached hereto that are
issued and distributed by the Company, provided that the Products are
qualified for sale under all applicable federal and state securities
and insurance laws and regulations of the jurisdiction in which the
solicitations, offers or sales will be made.
1.2. During the term of this Agreement, the Company will notify
Broker-Dealer of the issuance by the Securities and Exchange Commission
("SEC") or regulatory authority of any jurisdiction of any stop order
with respect to the registration statement or any amendments thereto or
the initiation of any proceedings for that purpose or for any other
purpose relating to the registration and/or offering of the Products
and of any other action or circumstance that may prevent the lawful
sale of any Product in any jurisdiction.
1.3. During the term of this Agreement, the Company shall advise the
Broker-Dealer of any amendment to any registration statement and/or any
amendment, sticker or supplement to any prospectus.
ARTICLE II AGREEMENTS OF BROKER-DEALER
2.1 REGISTRATION AND LICENSES. The Broker-Dealer represents that it is a
registered Broker-Dealer with the SEC and a member in good standing of
the National Association of Securities Dealers, Inc. ("NASD"). The
Broker-Dealer represents that it is or will become registered, licensed
and appointed to sell the Products, as required under the securities
and insurance laws of those jurisdictions where its registered
representatives will solicit, offer and sell the Products. The
Broker-Dealer represents that each registered representative who
solicits, offers and sells the Products will be a duly registered
representative of the Broker-Dealer. The Broker-Dealer represents that
each registered representative will hold all registrations and licenses
required by the NASD and any applicable jurisdiction to sell the
Products.
2.2 SALES PRACTICES AND SUPERVISION. The Broker-Dealer agrees to lawfully
solicit, offer and sell the Products and further agrees to the
following:
(a) The Broker-Dealer shall only use advertising material and
sales literature, including prospectuses, that have been
approved by the Company and, if required, filed with the NASD
and any applicable jurisdiction. The Broker-Dealer agrees to
discard immediately any out-dated sales and advertising
material and prospectuses or any materials the Company
notifies the Broker-Dealer to discontinue using.
(b) The Broker-Dealer shall establish and implement compliance and
supervisory procedures for the supervision of the sales
practices and conduct of its registered representatives. The
Broker-Dealer shall submit to the Company, as reasonably
requested, periodic reports concerning compliance by the
Broker-Dealer and its registered representatives with its
procedures and applicable laws and regulations, as they may
pertain to the Company's Products. The Broker-Dealer agrees to
permit the Company to periodically audit its records with
respect to compliance upon reasonable notice.
(c) The Broker-Dealer agrees that its registered representatives
will not make recommendations to a customer to invest in a
Product in the absence of reasonable grounds to believe that
the Product is suitable for the customer. Determination of
suitability shall be the sole responsibility of the
Broker-Dealer.
(d) The Broker-Dealer agrees that neither it nor any of its
affiliates will engage in any systematic program to encourage
the replacement of any of the Company's Products (or those of
the Company's affiliates) with the products of any other
entity.
(e) The Broker-Dealer and its employees, agents or registered
representatives shall not, directly or indirectly, rebate or
offer to rebate all or part of its compensation on a Product
issued or to be issued by the Company, nor offer anything of
value to a customer not specified in the Product as an
inducement to the customer to buy or retain a Product issued
by the Company.
(f) As required by the SEC, the Broker-Dealer agrees that it will
ensure that registered representatives who solicit
participants to purchase an IRC Section 403(b) tax deferred
annuity specifically bring to the attention of the potential
participants the redemption restriction imposed by IRC Section
403(b)(11).
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(g) The Broker-Dealer agrees to offer any Products in compliance
with the interagency statement on Retail Sales of Non-Deposit
Investment Products issued by federal banking regulators on
February 15, 1994 ("Interagency Statement") and any amendments
thereto and official interpretation thereof.
(h) The Broker-Dealer agrees that, without the prior written
authorization of the Company, the Broker-Dealer shall not have
any authority on behalf of the Company, directly or
indirectly, to:
(i) alter, in any manner, any Product or any form relating
thereto;
(ii) alter, in any manner, any advertising material or other
written communications concerning the Products after
they have been approved by the Company;
(iii) waive or modify any terms, conditions or limitations of
the Products, forms, underwriting rules or interest
rates, or grant permits, special rates or make
endorsements;
(iv) incur any indebtedness or liability on behalf of the
Company, or expend or contract for the expenditure of
funds of the Company;
(v) adjust or settle any claim against the Company or any
of its affiliates or commit the Company with respect
thereto, or bind the Company in any way; or
(vi) make any oral or written representation about any
Product that is not contained in the prospectus or any
advertising material approved by the Company.
2.3 HANDLING OF CUSTOMER PAYMENTS. All payments for Products collected by
the Broker-Dealer shall be remitted promptly to the Company together
with all applications, forms and other documentation required by the
Company. Payments from customers shall be in accordance with the
procedures established by the Company from time to time. No payment is
deemed received by the Company until actually received by the Company.
The Broker-Dealer acknowledges that the Company retains the
unconditional right to reject, in whole or part, any application for a
Product. Upon the Company's acceptance of a Product application
submitted by the Broker-Dealer, the Company shall mail the appropriate
documentation of the Product to the Broker-Dealer, which shall make
prompt delivery to the customer; provided, however, that the Company
reserves the right to transmit such documentation directly to the
customer.
2.4 INDEPENDENT CONTRACTOR. The Broker-Dealer agrees it is and shall act as
an independent contractor. Nothing in this Agreement shall make the
Broker-Dealer, or any of its employees, agents or registered
representatives, an employee of the Company. Neither the Broker-Dealer,
nor its employees, agents, or registered representatives shall hold
themselves out to be employees, agents or registered representatives of
the Company in any dealings with the public. Neither the Broker-Dealer
nor its employees, agents or registered representatives has any
authority to bind the Company.
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2.5 AUTHORITY. The Broker-Dealer warrants and represents that it has the
authority to act on behalf of any and all of its subsidiaries, and is
hereby exercising such authority on behalf of such subsidiaries with
respect to the obligations set forth in this Agreement as well as the
transfer of customer payments and forms, and the acceptance of any
compensation paid under this Agreement.
2.6 TRAINING. The Broker-Dealer shall be responsible for training its
registered representatives with regard to the Products and the Company
procedures before such representatives are permitted to sell any
Product. The Company will, at the request of the Broker-Dealer, provide
such training to the registered representatives of the Broker-Dealer at
the Broker-Dealer's expense.
2.7 USE OF SALES AND TRAINING MATERIALS. The Broker-Dealer agrees that any
material that it develops or intends to use for sales, advertising,
training, explanatory or other purposes in connection with the Products
will not be used without the prior written consent of the Company.
2.8 COMPLIANCE WITH LAWS AND REGULATIONS. The solicitation, offer and sale
of the Products by the Broker-Dealer and its registered representatives
shall be undertaken only in accordance with applicable laws and
regulations. No registered representative of the Broker-Dealer shall
solicit, offer or sell the Products until duly registered, licensed, or
appointed, as required by the NASD and any applicable jurisdiction. The
Broker-Dealer understands and acknowledges that neither the
Broker-Dealer nor its registered representatives are authorized by the
Company to give any information or make any representation in
connection with the solicitation, offer or sale of the Products other
than as contained in the prospectus or sales or advertising material
supplied by the Company or otherwise authorized in writing by the
Company.
2.9 MAINTAINING RECORDS. The Broker-Dealer shall have the responsibility
for maintaining the records of those registered representatives of the
Broker-Dealer registered, licensed and appointed and otherwise
qualified to sell the Products as required by applicable laws and
regulations. The books, accounts and records maintained by the
Broker-Dealer that relate to the sale of the Products, shall be
maintained so as to clearly and accurately disclose the nature and
details of all transactions covered by the Agreement.
2.10. PROPRIETARY INFORMATION. All account records developed by the Company
or provided to the Company by the Broker-Dealer, including customers
files, sales aids, computer software, customer names, addresses,
telephone numbers and related paperwork, literature, authorizations,
manuals and supplies of every kind and nature relating to the Products
are and shall remain the property of the Company. Any and all such
materials (including without limitation, all copies made by the
Broker-Dealer and all materials developed by the Broker-Dealer in
support of the marketing, sales, advertising or training related to
the Products) shall be returned to the Company upon termination of
this Agreement. The Broker-Dealer shall keep confidential all such
information, and shall disclose such information only if authorized in
writing by the Company or expressly required by the laws or
regulations of any applicable jurisdiction or the NASD.
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2.11 MARKETING CHANGES. With respect to Products covered by this Agreement,
the Broker-Dealer shall notify the Company of any material change or
intention to materially change its marketing operations. Such notice
shall be given in the manner specified in Section 6.9 of this
Agreement. All of the Broker-Dealer's marketing plans and methods for
offering Products are subject to review by the Company at its sole
discretion.
ARTICLE III COMPENSATION
3.1 PAYMENT SCHEDULE. The Company agrees to pay compensation to the
Broker-Dealer for the sale of each Product lawfully sold by a
registered representative of the Broker-Dealer. In order to comply with
the laws of any applicable jurisdiction, such compensation may be paid
to a designee and/or a nominee, if provided in Exhibit 3.1 attached
hereto and made part of this Agreement. The amount of compensation
shall be in accordance with the Schedules attached hereto.
Notwithstanding the foregoing, no compensation shall be payable for any
transaction not in compliance with all applicable laws, rules and
regulations at the time of the solicitation, offer and sale of a
Product and thereafter. Notwithstanding any provision in the Schedules
concerning chargebacks, if any Product is rescinded or otherwise not
consummated, no compensation shall be paid, and no compensation shall
be paid with respect to any premium or other payments returned by the
Company to a customer for any reason.
Payment of compensation as described in the attached Schedules is due
only when an application for a Product, and any premium or other
payment with respect thereto, has been tendered to and accepted by the
Company. The Broker-Dealer shall be solely responsible for the payment
of any compensation of any kind to its registered representatives.
3.2 DEBTS OF BROKER-DEALER; DEDUCTIONS BY THE COMPANY. The Company reserves
the right to deduct from any compensation due the Broker-Dealer from
the Company any amount it determines is owed by the Broker-Dealer to
the Company or its affiliates. This right shall apply, but is not
limited to, the following: (i) advances to the Broker-Dealer; (ii)
compensation paid to the Broker-Dealer for payments by a customer
received by the Company and later returned or credited to such customer
for any reason; and (iii) any overpayment of compensation to the
Broker-Dealer. Any amounts due the Company shall be a debt of the
Broker-Dealer and will accrue interest at eight percent (8%) per annum
from the time incurred until paid by the Broker-Dealer or deducted by
the Company from amounts owing to the Broker-Dealer. The Company shall
have all rights of a creditor to collect amounts owed it by the
Broker-Dealer.
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3.3 PAYMENT UPON TERMINATION. Upon the termination of this Agreement, the
Broker-Dealer will be not be entitled to any further compensation on
business placed with the Company prior to the termination date of this
Agreement unless, and only to the extent, such compensation is provided
for in the applicable Schedule attached hereto (and further provided
the Broker-Dealer pays for all renewal or new appointment fees required
in order to pay such compensation). Notwithstanding the foregoing
sentence, compensation will not be paid after the termination date of
this Agreement if such payment or receipt of such payment would violate
any laws, rules or regulations of any applicable jurisdiction or the
NASD. Service fees, including, without limitation, trailer compensation
and asset-based compensation, if payable by the Company in accordance
with the Schedules attached hereto, are non-vested and transferable by
the Company in its sole discretion and will not be paid to the
Broker-Dealer following termination of this Agreement.
ARTICLE IV COMPLAINTS AND INVESTIGATIONS
4.1 COOPERATION. The Company and the Broker-Dealer agree to cooperate fully
in any investigation of the Broker-Dealer or proceeding with respect to
the Broker-Dealer, to the extent that such investigation or proceeding
concerns any matters related to the subjects of this Agreement. Without
limiting the foregoing:
(i) The Company shall promptly notify the Broker-Dealer of receipt
of any customer complaint or notice of any inquiry,
investigation or proceeding concerning any matter related to
the subjects of this Agreement; and
(ii) The Broker-Dealer shall promptly notify the Company of receipt
of any customer complaint or notice of any inquiry,
investigation or proceeding concerning any matter related to
the subjects of this Agreement. The Broker-Dealer shall
promptly notify the Company of any NASD, federal or state
inquiry, investigation or proceeding, or litigation or
arbitration that has been initiated against the Broker-Dealer.
4.2 SETTLEMENT BY THE COMPANY. The Company reserves the right to settle any
claim or complaint made by a customer concerning any conduct, act or
omission by the Broker-Dealer or its registered representatives. The
Broker-Dealer shall reimburse the Company for the amount of any such
settlement. Any such reimbursement to be made by the Broker-Dealer
shall be a debt of the Broker-Dealer as described in Section 3.2.
ARTICLE V INDEMNIFICATION.
5.1 BY THE COMPANY. The Company and its affiliates agree to hold harmless
and indemnify the Broker-Dealer and its affiliates against any and all
claims, damages, losses, liabilities and expenses (including reasonable
attorney fees and related expenses) arising from (i) any acts or
omissions of the Company and its employees and other associated persons
relating to the subjects of this Agreement, or (ii) any breach or
violation of this Agreement.
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5.2 BY THE BROKER-DEALER. The Broker-Dealer and its affiliates agree to
hold harmless and indemnify Company and its affiliates against any and
all claims, damages, losses, liabilities and expenses (including
reasonable attorney fees and related expenses) arising from (i) any
acts or omissions of the Broker-Dealer, its employees, registered
representatives and other associated persons (including, without
limitation, any Designee or Nominee identified in any Addendum to this
Agreement) relating to this Agreement; or (ii) any breach or violation
of this Agreement.
5.3 NOTICE OF ACTION. After receipt by an indemnified party of notice of
the commencement of any action with respect to which a claim will be
made against an indemnifying party, such indemnified party shall notify
the indemnifying party promptly in writing of the commencement of the
action. The failure to so notify the indemnifying party shall not
relieve the indemnifying party from any liability which it may
otherwise have to any indemnified party except and to the extent the
indemnifying party is prejudiced thereby. In any such action where the
indemnified party has given the notice described in this Section 5, the
indemnifying party shall be entitled to participate in and, at its
option, jointly with any other indemnifying party similarly notified,
to assume defense of the action. After notice to such indemnified party
that the indemnifying party has elected to assume defense of the
action, the indemnifying party shall not be liable to such indemnified
party for any legal or other expenses subsequently incurred by such
indemnified party in connection with the defense other than reasonable
costs of investigation.
ARTICLE VI MISCELLANEOUS
6.1 ASSIGNABILITY
This Agreement shall be binding upon and inure to the benefit of the
parties hereto and their respective successors and permitted assigns.
This Agreement may not be assigned by either party without the written
consent of the other party.
6.2 GOVERNING LAW
This Agreement shall be governed by and construed in accordance with
the laws of the United States, the State of Connecticut (without regard
to its choice of law provisions), and rules of the NASD, as applicable.
6.3 REVOCATION OF PRIOR AGREEMENTS
This Agreement (including the exhibits and schedules attached hereto)
constitutes the entire agreement between the Company and the
Broker-Dealer with respect to the matters set forth herein. This
Agreement supersedes all previous contracts, agreements or arrangements
made between the parties with respect to the matters set forth herein.
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6.4 SEVERABILITY
The provisions of this Agreement are severable, and if any provision of
this Agreement is found to be invalid, such provision shall not affect
any other provision of this Agreement that can be given effect without
the invalid provision.
6.5 AMENDMENTS
(a) The Company may amend this Agreement or any Schedule hereto at
any time without approval of the Broker-Dealer. Subject to
Section 6.7(a)(vi), an amendment to this Agreement shall
become effective thirty (30) days from the date notice is
given the Broker-Dealer; provided, however, amendments to
Schedules (or to Exhibits to Schedules) shall be effective
from the date notice is given to the Broker-Dealer that a new
or amended Schedule has been issued by the Company.
(b) No amendment to this Agreement requested by the Broker-Dealer
shall be effective unless it is agreed to in writing by the
Company.
6.6 WAIVER
Failure of either party to require performance of any provision of this
Agreement shall not constitute a waiver of that party's right to
enforce such provision at a later time. Waiver of any breach of any
provision shall not constitute a waiver of any preceding or subsequent
breach.
6.7 TERMINATION
(a) This Agreement shall terminate:
(i) Immediately, if the Broker-Dealer is dissolved,
liquidated or otherwise ceases business operations;
(ii) Upon notice by the Company to the Broker-Dealer, if the
Broker-Dealer fails, in the Company's reasonable
judgment, to comply with any of its material
obligations under this Agreement;
(iii) Upon notice by the Broker-Dealer to the Company, if the
Company fails, in the Broker-Dealer's reasonable
judgment, to comply with any of its material
obligations under this Agreement;
(iv) Immediately if any state or jurisdiction revokes,
suspends or otherwise terminates the insurance license
or appointment to represent the Company of the
Broker-Dealer or, where applicable, the Broker-Dealer's
Designee and/or Nominee, unless the Broker-Dealer
immediately substitutes Designee and/or Nominee
satisfactory to the Company, in its sole discretion;
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(v) Immediately, if the Broker-Dealer's SEC, state or NASD
registration or membership is suspended, terminated or
otherwise restricted so as to render the Broker-Dealer,
in the Company's opinion, unable to perform its
obligations pursuant to this Agreement; or
(vi) Immediately upon such notification, if the
Broker-Dealer notifies the Company within 15 days of
receiving notice of an Amendment in accordance with
Section 6.5(a).
(c) Notwithstanding the provisions of Section 6.7(a), each of the
Company and the Broker-Dealer have the right to terminate this
Agreement for any reason upon sixty (60) days written notice
to the other party.
(d) Upon termination of this Agreement, all authorizations, rights
and obligations shall cease; provided, however that the
provisions of Sections 3.2 and 3.3 and Articles IV and V shall
survive termination.
6.8 ARBITRATION
All claims and controversies related to or stemming from this
Agreement, except actions for equitable relief pending an arbitration
award, shall be submitted to binding arbitration in Hartford,
Connecticut in accordance with the Code of Arbitration procedure of the
NASD, if the NASD accepts jurisdiction, and, if not, by a panel of
three neutral arbitrators under the Commercial Arbitration Rules of the
American Arbitration Association. Judgement upon an award of the
arbitrators may be entered and enforced in any court having
jurisdiction. The parties to such dispute will equally share the fees
and expenses of the arbitrators. The parties agree that the prevailing
party in any such arbitration, as determined by the arbitrator(s),
shall be entitled to reasonable attorney's fees.
6.9 NOTICE
Any notice required by the terms of this Agreement, shall be valid if
in writing and hand delivered, or sent by United States Mail postage
prepaid, overnight delivery service or facsimile transmission with
confirmation by U.S. Mail to the other party at the address provided
below such party's signature hereto.
6.10 FORCE MAJEURE
No party to this Agreement shall be responsible to the other for delays
or errors in its performance or other breach under this Agreement
occurring solely by reason of circumstances beyond its control,
including acts of civil or military authority, national emergencies,
fire, major mechanical breakdown, labor disputes, flood or catastrophe,
acts of God, insurrection, war, riots, delays of supplier, or failure
of transportation, communication or power supply.
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6.11 HEADINGS
The headings in this Agreement are for reference purposes only and
shall not be deemed part of this Agreement or affect its meaning or
interpretation.
6.12 COUNTERPARTS
This Agreement may be executed in any number of counterparts, all of
which, taken together, shall constitute one agreement, and any party
hereto may execute this Agreement by signing any such counterpart.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly
executed as of the day and year first above written.
AETNA LIFE INSURANCE AND ANNUITY COMPANY
By: /s/ Xxxxx Xxxxx Date: 6/7/00
------------------------------------ -------------------
Name: Xxxxx Xxxxx
Title: Senior Vice President
Address: 000 Xxxxxxxxxx Xxxxxx
Xxxxxxxx, XX 00000
AETNA INVESTMENT SERVICES, INC.
By: /s/ Xxxxxxx X. Xxxxxx Date: 6/5/00
------------------------------------ -------------------
Name: Xxxxxxx X. Xxxxxx
Title: President
Address: 000 Xxxxxxxxxx Xxxxxx
Xxxxxxxx, XX 00000
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Aetna Financial Services
000 Xxxxxxxxxxx Xxxxxx, XXX0
Xxxxxxxx, XX 00000
XXXXX XXXXXX
Assistant Vice President
Aetna Life Insurance and Annuity Company
November 2, 2000 Producer Services, TSA1
(000) 000-0000 Tel
(000) 000-0000 Fax
Broker Dealer AAA
C/O Compliance/Legal Department or Broker Dealer Contact Name
000 Xxxx Xxxxxx
Anywhere, XX 11111
RE: AETNA LIFE INSURANCE AND ANNUITY COMPANY/AETNA INSURANCE
COMPANY OF AMERICA BROKER-DEALER AGREEMENTS
Dear Selling or Service Agreement Holder:
You currently have a Broker-Dealer Agreement with Aetna Life Insurance and
Annuity Company ("ALIAC") and or Aetna Insurance Company of America (AICA) to
solicit, offer, sell and service certain registered and/or unregistered products
issued by ALIAC and/or AICA (the "Agreement"). ALIAC & AICA have entered into
Principal Underwriter arrangements with their broker-dealer subsidiary, Aetna
Investment Services, Inc. ("AISI"), under which AISI has become the principal
distributor of products issued by ALIAC and AICA. Accordingly, this is to advise
you that ALIAC and AICA are assigning the Agreement to AISI. AISI assumes all
rights and obligations under the Agreement on its own behalf and on behalf of
ALIAC and/or AICA. ALIAC and AICA remain bound to see that AISI performs all
obligations of the Agreement. You should experience no change in your
interactions with us and this agreement will not affect the compensation you
receive or your obligations to ALIAC, AICA and AISI.
Please confirm your acceptance of this assignment by executing a copy of this
letter below and returning it to the following address:
Aetna Financial Services
X/X Xxxxxxxx & Xxxxx Xxxxxxxx, Xxxxxxxxx: Selling/Service Agreement Addendum's
000 Xxxxxxxxxx Xxx. XX: TSA1
Xxxxxxxx, XX 00000
If we have not received your confirmation by November 17, 2000, you will be
deemed to have accepted this assignment. FOR ASSISTANCE WITH INQUIRIES TO THIS
LETTER, PLEASE ASK FOR XXXX XXXXXXXXX, XXXXXXX XXXXX OR XXXXX XXXXXX AT
0-000-000-0000 OPTION #2.
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We thank you for your continued interest in and support of our products.
Respectfully,
--------------------------------
Xxxxx X. Xxxxxx
Please indicate your agreement with the foregoing by countersigning both copies
of this letter where indicated below and returning one to us for our files.
Acknowledged and Agreed to:
Aetna Life Insurance and Annuity Company [Broker Dealer]
By____________________________ By_______________________________
Name: Name:
Title: Title:
Date: Date:
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