Security Distributors, Inc.
 |
Security Distributors, Inc. | ||
| A Member of The Security Benefit Group of Companies |
One Security Benefit Xxxxx Xxxxxx, Xxxxxx 00000-0000 (000) 000-0000 |
||
MARKETING ORGANIZATION AGREEMENT
COMMISSION SCHEDULE
SecureDesigns® Variable Annuity (the "Contract")
Issued by First Security Benefit Life Insurance
and Annuity Company of New York
Marketing Organization:
(Broker/Dealer)
EFFECTIVE DATE OF COMMISSION SCHEDULE:
COMMISSIONS - This Commission Schedule is hereby made a part of and amends your Marketing Organization Agreement (hereinafter called the "Agreement"), with Security Distributors, Inc. (hereinafter called "SDI"), and commissions payable hereunder are subject to the provisions contained in the Agreement and this Commission Schedule. Minimum Purchase Payments are as set out in the applicable prospectus and Contract. Commissions to a Marketing Organization are equal to a percentage of each Purchase Payment written by Marketing Organization, as follows:
- UP FRONT COMMISSIONS: The rate of commissions paid on Purchase
Payments made with respect to each particular Contract is based on the issue
age of the Owner (or of the Annuitant if the Contract is owned by a
non-natural person) as set forth in the tables below. You may select one of
Commission Options A through D as shown in the table below at the time of
application for each Contract. If no selection is made on the application,
SDI will pay you pursuant to Option B. You may select a different option
for each Contract but may not change the Option in effect after the Contract
is issued.
Commission Option OPTION A* OPTION B OPTION C OPTION D Owner Issue Age 0-80 81-85 0-80 81-85 0-80 81-85 0-80 81-85 6.50% 0.00% 5.00% 2.50% 2.50% 0.00% 0.00% 0.00%
No Commission will be paid on Purchase Payments made that are less than the minimum specified in the applicable prospectus and Contract.
*Commission Option A is not available in connection with a Contract qualified under Section 401, 403 or 457 of the Internal Revenue Code. Option A is available, however, in connection with a Contract issued as an individual retirement annuity under Section 408 or 408A of the Code. - ASSET-BASED COMMISSIONS: Under Commission Options B, C and D, SDI
will pay an asset-based commission as of the end of each calendar month. The
amount of the asset-based commission under each Option is equal to 1/12 of the
applicable percentage set forth in the table below times the aggregate
Contract Value of those Contracts sold under the applicable Commission Option
for which Marketing Organization is the broker of record and, with respect to
Options B and C only, the initial Purchase Payment is more than 12 months old.
For Option D only, the asset-based commission will be paid as of the end of
the first calendar month of the Contract Date. On an annual basis, the
asset-based commission is equal to the amount set forth in the Table below. No
asset-based commission will be paid on Contracts that have annuitized under a
life contingent annuity option. An Annuitization Fee may be available as
discussed in paragraph 7.
Commission Option OPTION A* OPTION B OPTION C OPTION D Owner Issue Age 0-80 81-85 0-80 81-85 0-80 81-85 0-80 81-85 0 bps 0 bps 25 bps 25 bps 45 bps 0 bps 65 bps 60 bps
*Commission Option A is not available in connection with a Contract qualified under Section 401, 403 or 457 of the Internal Revenue Code. Option A is available, however, in connection with a Contract issued as an individual retirement annuity under Section 408 or 408A of the Code. - ALTERNATE WITHDRAWAL CHARGE RIDER: For a Contract sold with an
Alternate Withdrawal Charge Rider, the commission and asset-based commission
schedules set forth above do not apply. The following commission and
asset-based commission schedules will apply in lieu of those set forth above
if an Alternate Withdrawal Charge Rider is in effect. The following commission
rates are applicable based upon the Alternate Withdrawal Charge Rider
selected. The amount of commission and asset-based commission varies based
upon the Duration of the contract as set forth below, which is measured from
the Contract Date.
Alternate
Withdrawal
Charge RiderDuration of the Contract Up Front Commission*
Based on Owner Age at IssueAsset Based Commission**
Based on Owner Age at Issue0-80 81+ 0-80 81+ 0-year 0-12 months 1.50% 1.0% 0% 0% 13-24 months 0% 0% 1.00% 0.90% 25 months and thereafter 0% 0% 1.25% 1.15% Alternate
Withdrawal
Charge RiderDuration of the Contract Up Front Commission*
Based on Owner Age at IssueAsset Based Commission**
Based on Owner Age at Issue0-80 81+ 0-80 81+ 4-year 0-12 months 5% 2.5% 0% 0% 13-24 months 4% 2.0% 0% 0% 25-36 months 3% 1.5% 0% 0% 37-48 months 2% 1.0% 0% 0% 49 months and thereafter 0% 0% 1% 1%
*The up front commission is equal to the applicable percentage of each Purchase Payment written by Marketing Organization based upon the applicable Alternate Withdrawal Charge Rider in effect and the Contract Duration upon receipt of the Purchase Payment.
**The amount of the asset-based commission is equal to 1/12 of the applicable percentage set forth in the table above times the aggregate Contract Value of those Contracts sold under the applicable Alternate Withdrawal Charge Rider for which Marketing Organization is the broker of record. - CONTRACT DATE: For the purpose of this Commission Schedule, the
term "Contract Date" shall be the date the first Purchase Payment is credited
to the Contract.
- DEATH BENEFIT APPLIED TO ANNUITY OPTION: In the event that a
beneficiary of a Contract under this Commission Schedule applies the death
benefit to one of the annuity options under the Contract, no commission will
be payable upon such application. An Annuitization Fee may be available as
discussed in paragraph 7.
- ANNUITIZATION: An Annuitization Fee will be paid to a Marketing
Organization who secures from the Contract Owner (or his or her beneficiary)
the proper forms and information to commence an immediate life contingent
annuity option under the Contract and significantly assists the client and
insurer in such settlement. The Annuitization Fee will be equal to 4% of the
amount applied to a fixed life contingent annuity option and 2% of the amount
applied to a variable life contingent annuity option.
- COMMISSION CHARGEBACK PROVISIONS: No Commission chargebacks are
applicable to any partial withdrawals, full surrenders or death claims except
in the event of a free look surrender or for Contracts that have selected a
0-Year Alternate Withdrawal Charge Rider. In the event of a full withdrawal
during the first 18 months of a Contract with a 0-Year Alternate Withdrawal
Charge Rider, SDI will charge back 100% of commissions paid in connection with
the Contract. In the event of a partial withdrawal that exceeds the Free
Withdrawal Amount as defined in the Contract during the first eighteen (18)
months of a Contract with a 0-Year Alternate Withdrawal Charge Rider, SDI will
charge back 100% of commissions paid in connection with the withdrawal amount
that exceeds the Free Withdrawal Amount. SDI also will charge back 100% of
commissions in the event of a free look surrender.
- CHANGE OF COMMISSION SCHEDULE: Notwithstanding any other provision
of the Agreement to the contrary, the following provisions shall apply. SDI
reserves the right at any time, with or without notice, to change, modify or
discontinue the commissions, asset-based commissions or any other compensation
payable under this Commission Schedule.
- CHANGE OF DEALER: A Contract Owner shall have the right to
designate a new marketing organization, or terminate a marketing organization
without designating a replacement, by sending written notice of such
designation or termination to SDI. Upon written notice to SDI by the Owner of
the designation of a new marketing organization, all the commissions and
asset-based commissions shall be payable to the new marketing organization.
Upon written notice to SDI by the Contract Owner of termination of Marketing
Organization, without designating a new marketing organization, SDI shall
cease paying commissions and asset based commissions to Marketing
Organization.
- TERMINATION OF THE AGREEMENT/VESTING: In the event of termination of the Agreement for any reason, all rights to receive commissions, asset-based commissions or other compensation under this Commission Schedule shall be terminated, unless each of the following requirements is met: (i) the Agreement has been in force for at least one year; (ii) Marketing Organization is at the time such commissions are payable properly licensed to receive such commissions; (iii) Marketing Organization is providing service to the Contract Owner and performing its duties in a manner satisfactory to SDI; (iv) commissions paid to Marketing Organization in the previous calendar year amounted to at least $500; and (v) Marketing Organization has not been terminated, nor a new marketing organization designated, by the Contract Owner as set forth in paragraph 10 above.
THIS COMMISSION SCHEDULE replaces any previous Commission Schedule for the Variable Annuity Contract listed above as of the Effective Date set forth above.
| SECURITY DISTRIBUTORS, INC. | |
| By: | XXXXXXX X. XXXXXX |
| Title: | President |
8859 (R3-01)
