MetLifeInvestors
MetLife Investors Insurance Company
SELLING AGREEMENT
This Agreement is made as of 9/16/02 (such date, following execution and
delivery by all parties, to be the "Effective Date"), by and among MetLife
Investors Insurance Company, a Missouri life insurance company ("Life
Company"); and MetLife Investors Distribution Company, a Delaware corporation
("Distributor"); Xxxxxx Xxxxxxx XX Inc. ("Broker-Dealer") and Xxxxxx Xxxxxxx XX
Inc. ("General Agent") and its affiliates attached.
This agreement is made to allow for the sale and services of product sales on a
pre-approved exception basis. An officer of Xxxxxx Xxxxxxx XX Inc. headquarters
in New York before policy issuance or application acceptance must approve all
sales individually in writing. Unless so approved, this agreement shall have no
further effectiveness either retroactively or prospectively.
RECITALS
A. Life Company is the issuer of certain fixed and variable annuity
contracts and variable life insurance contracts identified in Schedule I (the
"Contracts"), (which Schedule I may be amended from time to time in accordance
with Section 2.6) and has appointed Distributor as principal underwriter or
distributor of the Contracts and authorized Distributor to recommend persons
for appointment as agents of Life Company to solicit applications for the sale
of the Contracts.
B. Distributor and Broker-Dealer are both broker-dealers registered with the
Securities and Exchange Commission under the Securities Exchange Act of 1934,
as amended ("1934 Act"), and members of the National Association of Securities
Dealers, Inc.
C. General Agent, which is an Affiliate of, or the same person as,
Broker-Dealer, or whose employees are also employees of Broker-Dealer, is an
insurance agency duly licensed to sell variable life insurance and fixed and
variable annuities in any state or other jurisdiction in which General Agent
intends to perform hereunder.
D. It is intended that General Agent shall be authorized to offer and sell
the Contracts to the general public subject to the terms and conditions set
forth more fully herein.
E. Life Company has authorized Distributor to enter into separate written
agreements with broker-dealers registered under the 1934 Act which agree to
participate in the distribution of the Contracts, and the parties hereto desire
that Broker-Dealer be authorized to solicit applications for the sale of the
Contracts.
NOW, THEREFORE, in consideration of the premises and of the mutual covenants
and promises herein contained, the parties hereto agree as follows:
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ARTICLE I
Definitions
1.1 Defined Terms. In addition to any terms defined elsewhere in this
Agreement, the terms defined in this Section 1.1, whenever used in this
Agreement (including in the Recitals, Schedules, and Exhibits), shall have the
respective meanings indicated.
a. Affiliated Person or Affiliate - With respect to a person, any other
person controlling, controlled by, or under common control with such person.
b. Agent - An individual associated with General Agent and registered
with the NASD as a representative of Broker-Dealer who is appointed by Life
Company as an insurance agent for the purpose of soliciting applications for
the Contracts.
c. Broker-of-Record - The party designated in Life Company records as
the person, with respect to a Contract, who is entitled to receive compensation
payable with respect to such Contract and who is authorized to contact directly
the owner of such Contract. In the case of compensation payable with respect to
a Premium, the Broker-of-Record shall be the party designated as such in the
records of Life Company at the time such Premium is accepted by Life Company.
In the case of compensation payable with respect to Contract value or client
services, the Broker-of-Record shall be the party designated as such in the
records of Life Company, in accordance with the rules and procedures of Life
Company at the time any such payment is payable. In the case of compensation
payable on annuitization of a Contract, the Broker-of Record shall be the party
designated as such in the records of Life Company on the annuity commencement
date specified in such Contract.
d. Contract Prospectus - The prospectus for the interests under the
Contracts included within a Contract Registration Statement and including any
prospectus or supplement separately filed under the Contract Registration
Statement respecting the Contracts.
e. Contract Registration Statements - The most recent effective
registration statements, or most recent effective post-effective amendments
thereto, relating to interests under the Contracts and in the Variable
Accounts, as required by the 1933 Act and the 1940 Act, including the statement
of addition of information, financial statements therein and all exhibits
thereto.
f. Contracts - The life insurance policies and annuity contracts,
including certificates, issued by Life Company, which are identified in
Schedule I. Schedule I may be modified from time to time as provided in
Section 2.6.
g. NASD - National Association of Securities Dealers, Inc.
h. 1940 Act - investment Company Act of 1940, as amended.
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i. 1934 Act - Securities Exchange Act of 1934, as amended.
j. 1933 Act - Securities Act of 1933, as amended.
k. Premium - Any premium, purchase payment, contribution or other
consideration relating to the Contracts.
l. SEC or Commission - Securities and Exchange Commission.
m. Service Center - The Life Company's Policy Service Office:
i. Fixed Products: X.X. Xxx 000, Xxx Xxxxxx, XX 00000
ii. Variable Products: X.X. Xxx 00000, Xxx Xxxxxx, XX 00000
iii. Express Mail Only: 0000 Xxxx Xxxxx Xxxxxxx, Xxxx Xxx Xxxxxx,
00000
n. Variable Accounts - Segregated asset accounts identified in Schedule
I, each of which has been established by Life Company pursuant to state laws as
a funding vehicle for the Contracts. The Variable Accounts are divided into
divisions that invest in shares of an investment company.
2.2 Cross-References. All references in this Agreement to a Section,
Article, Schedule or Exhibit are to a section, article, schedule or exhibit of
this Agreement, unless otherwise indicated.
ARTICLE II
Authorization of Broker-Dealer and General Agent
2.1 Authority to Distribute Contracts. Distributor hereby authorizes
Broker-Dealer, under the securities laws, and General Agent, under the
insurance laws, each in a non-exclusive capacity, to distribute the Contracts.
Broker-Dealer and General Agent accept such authorization and agree to use
their best efforts to find purchasers for the Contracts in each case acceptable
to Life Company. Broker-Dealer and General Agent understand that the public
offering of and solicitation for interests under the variable life and variable
annuity Contracts are not permitted to commence, or to continue, unless the
Contract Registration Statements have become effective and, with respect to
each state or other jurisdiction in which Contract applications are to be
solicited, the Contracts are qualified for sale under all applicable securities
and insurance laws. Broker-Dealer and General Agent acknowledge that no
territory is exclusively assigned hereunder, and Life Company reserves the
right in its sole discretion to establish or appoint one or more agencies in
any jurisdiction in which General Agent transacts business hereunder.
2.2 Notification by Distributor. Distributor shall promptly notify
Broker-Dealer and General Agent:
a. If there are no effective Contract Registration Statements, when the
Contract Registration Statements have become effective;
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b. Of all states and other jurisdictions in which the Contracts are
qualified for sale and of the states and other jurisdictions in which the
Contracts may not be lawfully sold;
c. Of any request by the SEC for any amendments or supplements to a
Contract Registration Statement or of any request for additional information
that must be provided by Broker-Dealer or General Agent or any Affiliate of
Broker-Dealer or General Agent;
d. Of the issuance by the SEC of any stop order with respect to a
Contract Registration Statement or the initiation of any proceedings for that
purpose or for any other purpose relating to the registration and/or offering
of the Contracts; or
e. If any event occurs as a result of which a Contract Prospectus or any
sales literature for the Contracts would include any untrue statement of a
material fact or omit to state a material fact necessary to make the statements
therein not misleading.
2.3 Authority to Recommend Agent Appointments. General Agent is vested under
this Agreement with power and authority to select and recommend individuals who
are associated with General Agent and are registered representatives of
Broker-Dealer for appointment as agents of Life Company, and only individuals
so recommended by General Agent shall become Agents, provided that Life Company
reserves the right in its sole discretion to refuse to appoint any proposed
agent or, once appointed, to terminate the same at any time with or without
cause.
2.4 Limitations on Authority. Neither Broker-Dealer nor General Agent shall
possess or exercise any authority on behalf of Distributor or Life Company
other than that expressly conferred on Broker-Dealer or General Agent by this
Agreement. In particular, and without limiting the foregoing, neither
Broker-Dealer nor General Agent shall have any authority, nor shall either
grant such authority to any Agent: (i) to make, alter or discharge any Contract
or other contract entered into pursuant to a Contract; (ii) to waive any
Contract provision; (iii) to extend the time for payment of any Premiums; or
(iv) to receive any monies or Premiums from applicants for or purchasers of the
Contracts (except for the sole purpose of forwarding monies or Premiums to Life
Company).
2.5 Insurer's Right to Reject Applications. Broker-Dealer and General Agent
acknowledge that Life Company has the right in its sole discretion to reject
any applications or Premiums received by it and to return or refund to an
applicant such applicant's Premium. In the event that a Life Company rejects an
application solicited by an Agent, Life Company will return any Premium paid by
the applicant to such applicant and will promptly notify General Agent of such
action. In the event that a purchaser exercises his or her free look right
under a Contract, any amount to be refunded as provided in such Contract will
be so refunded to the purchaser by or on behalf of Life Company, and Life
Company will promptly notify General Agent of such action.
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2.6 Contracts Included Under Agreement. Schedules I to this Agreement
describe the life insurance and annuity contracts, which are included as
Contracts under this Agreement. Schedule I may be amended by Distributor in its
sole discretion from time to time to include other annuity contracts or life
insurance contracts issued by Life Company and distributed by Distributor
pursuant to any distribution agreement with Life Company. The provisions of
this Agreement shall apply with equal force to such additional Contracts unless
the context otherwise requires. Schedule I may be amended by Distributor in its
sole discretion from time to time to delete annuity contracts or life insurance
contracts.
2.7 Independent Contractor Status. Distributor acknowledges that
Broker-Dealer and General Agent are each independent contractors. Accordingly,
while Broker-Dealer and General Agent agree to use their respective best
efforts to solicit applications for the Contracts, Broker-Dealer and General
Agent are not obliged or expected to give full time and energies to the
performance of their obligations hereunder or to sell or solicit a specified
number of Contracts, nor are Broker-Dealer and General Agent obliged or
expected to represent Distributor or Life Company exclusively. Nothing herein
contained shall constitute Broker-Dealer, General Agent, or any agents or
representatives of Broker-Dealer or General Agent as employees of Life Company
or Distributor.
ARTICLE III
Licensing and Registration of Broker-Dealer, General Agent and Agents
3.1 Broker-Dealer Qualifications. Broker-Dealer represents and warrants that
it is a broker-dealer registered with the SEC under the 1934 Act, and is a
member of the NASD in good standing. Broker-Dealer must, at all times when
performing its functions and fulfilling its obligations under this Agreement,
be duly registered as a broker-dealer under the 1934 Act and, as required by
applicable law, in each state or other jurisdiction in which Broker-Dealer
intends to perform its functions and fulfill its obligations hereunder, and be
a member in good standing of the NASD.
3.2 General Agent Qualifications. General Agent represents and warrants that
it is a licensed life insurance agency where required to solicit applications
for the Contracts. General Agent must, at all times when performing its
functions and fulfilling its obligations under this Agreement be duly licensed
to offer or sell the Contracts in each state or other jurisdiction in which
General Agent intends to perform its functions and fulfill its obligations
hereunder.
3.3 Qualifications of Broker-Dealer Representatives. Broker-Dealer
represents and warrants that it shall ensure that no individual shall offer or
sell the variable life or variable annuity Contracts on behalf of Broker-Dealer
in any state or other jurisdiction in which the Contracts may lawfully be sold
unless: such individual is an associated person of Broker-Dealer (as that term
is defined in Section 3(a)(18) of the 1934 Act); is not subject to a statutory
disqualification (as that term is defined in the 1934 Act); and is duly
registered with the NASD and any applicable state securities regulatory
authority as a registered person of Broker-Dealer qualified to distribute the
Contracts in such state or other jurisdiction.
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3.4 Qualifications of General Agent's Agents and Appointment of Agents.
General Agent represents and warrants that it shall ensure that no individual
shall offer or sell the Contracts on behalf of General Agent in any state or
other jurisdiction unless such individual is duly appointed as an agent of
General Agent, duly licensed and appointed as an agent of Life Company and
appropriately licensed (including any special variable licensing), registered
or otherwise qualified to offer and sell the Contracts to be offered and sold
by such individual under the insurance laws of such state or jurisdiction.
Nothing in this Agreement is to be construed as requiring Life Company to
obtain a license or issue a consent or appointment to enable any particular
agent to sell the Contracts. All matters concerning the licensing of any
individuals recommended for appointment by General Agent under any applicable
state insurance law shall be a matter directly between the General Agent and
such individual. General Agent shall furnish Life Company with proof of proper
licensing of such individual or other proof, reasonably acceptable to Life
Company, of satisfaction by such individual of licensing requirements prior to
the appointment of any such individual as an agent of Life Company. In
conjunction with the submission of appointment papers for all such individuals
as insurance agents of Life Company, General Agent shall be deemed to represent
that each individual is competent and qualified to act as an agent for Life
Company and to hold himself or herself out in good faith to the general public.
Broker-Dealer and General Agent shall notify Distributor and Life Company
immediately upon termination of an Agent's association with Broker-Dealer or
General Agent.
ARTICLE IV
Broker-Dealer and General Agent Compliance
4.1 Supervisory Responsibilities of General Agent. General Agent shall
train, supervise and be solely responsible for the conduct of Agents in their
solicitation activities in connection with the Contracts, and shall supervise
Agents' strict compliance with applicable laws, rules and regulations of any
governmental or other insurance authorities that have jurisdiction over
insurance contract activities, as well as the rules and procedures of Life
Company pertaining to the solicitation, sale and submission of applications for
the Contracts and the provision of services relating to the Contracts. General
Agent shall be solely responsible for background investigations of the proposed
agents to determine their qualifications, good character and moral fitness to
sell the Contracts and will provide Life Company with copies of such
investigations upon its request.
4.2 Supervisory Responsibilities of Broker-Dealer. Broker-Dealer shall be
responsible for securities training, supervision and control of Agents in
connection with their solicitation activities and any incidental services with
respect to the Contracts and shall supervise Agents' strict compliance with
applicable federal and state securities laws and NASD requirements in
connection with such solicitation activities and with the rules and procedures
of Life Company.
4.3 Compliance with Applicable Laws. Broker-Dealer and General Agent hereby
represent and warrant that they are in compliance with all applicable federal
and state securities laws and regulations and all applicable insurance laws and
regulations, including without limitation, state insurance laws and regulations
imposing insurance licensing requirements. Broker-Dealer and General Agent each
agree to carry out their respective sales and
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administrative activities and obligations under this Agreement in continued
compliance with federal and state laws and regulations, including those
governing securities and insurance-related activities or transactions, as
applicable. If Broker-Dealer and General Agent are separate entities, they
represent and warrant that they are and will continue to be in compliance with
applicable requirements with respect to the non-registration as a broker-dealer
of an insurance agency associated with a registered broker-dealer.
Broker-Dealer and General Agent shall notify Distributor and Life Company
immediately in writing if Broker-Dealer and/or General Agent fail to comply
with any of the laws and regulations applicable to either of them.
In connection with the offer and sale of variable life insurance policies as a
part of the Contracts to be offered hereunder, Broker-Dealer and General Agent
further agree that no recommendations shall be made to an applicant to purchase
a variable life insurance policy and that no variable life insurance shall be
issued in the absence of reasonable grounds to believe that the purchase of
such policy is not unsuitable for such applicant on the basis of information
furnished after reasonable inquiry of such applicant concerning the applicant's
insurance and investment objectives, financial situation and needs, and any
other information known to the Broker-Dealer or General Agent.
4.4 Restrictions on Sales Activity. Broker-Dealer, General Agent and Agents
shall not offer or attempt to offer the Contracts, nor solicit applications for
the Contracts, nor deliver the Contracts, in any state or other jurisdiction in
which the Contracts may not be lawfully sold or offered for sale. For purposes
of determining where the Contracts may be offered and applications solicited,
Broker-Dealer and General Agent may rely on written notification, as revised
from time to time, received from the Distributor.
4.5 Premiums and Other Payments. All Premiums and loan repayments shall be
sent promptly (and in no event later than the time permitted under applicable
law or the rules of the NASD) to Life Company at the Service Center, or at such
other address as Life Company or Distributor may subsequently specify in
writing. Each initial Premium shall be preceded or accompanied by a properly
completed application for a Contract, which shall include applications
submitted electronically to Life Company in such manner and format as Life
Company shall authorize. Checks in payment of Premiums or outstanding loans
shall be drawn to the order of Life Company.
4.6 Misdirected Payments. In the event that Premiums or loan repayments are
sent to General Agent or Broker-Dealer, rather than to Life Company, General
Agent or Broker-Dealer shall promptly (and in no event later than the time
permitted under applicable law or the rules of the NASD) remit such Premiums to
the Service Center. General Agent and Broker-Dealer acknowledge that if any
Premium or other payment is held at any time by either of them, such Premium or
other payment shall be held on behalf of the client, and General Agent or
Broker-Dealer shall segregate such Premium or other payment from their own
funds and promptly (and in no event later than the time permitted under
applicable law or the rules of the NASD) remit such Premium or other payment to
Life Company through the Service Center.
4.7 Delivery of Contracts. Upon issuance of a Contract by Life Company and
delivery of such contract to General Agent, General Agent shall promptly
deliver such Contract
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to its purchaser. Consistent with its administrative procedures, Life Company
will assume that a Contract issued by it will be promptly delivered by General
Agent to the purchaser of such Contract. As a result, if a purchaser exercises
the free look rights under a Contract, Broker-Dealer and the General Agent
shall indemnify Life Company for any loss incurred by Life Company that results
from General Agent's failure to promptly deliver such Contract to its purchaser.
4.8 Restrictions on Communications. Neither Broker-Dealer not General Agent,
nor any of their directors, partners, officers, employees, registered persons,
associated persons, agents or affiliated persons, in connection with the offer
or sale of the Contracts, shall give any information or make any
representations or statements, written or oral, concerning the Contracts, the
Variable Accounts or Life Company other than information or representation
contained in the Contract Prospectuses, the prospectuses of the underlying
mutual funds, statements of additional information and Contract Registration
Statements, or in reports or proxy statements therefor, or in promotional,
sales or advertising material or other information supplied and approved in
writing by Life Company or Distributor.
4.9 Directions Given on Behalf of Contract Owners. Broker-Dealer and General
Agent shall be solely responsible for the accuracy and propriety of any
instruction given or action taken by an Agent on behalf of an owner or
prospective owner of a Contract. Neither Distributor nor Life Company shall
have any responsibility or liability for any action taken or omitted by it or
by them in good faith in reliance on or by acceptance of such an instruction or
action.
4.10 Restrictions on Sales Material and Name Usage. Broker-Dealer and
General Agent shall neither use nor authorize the use of any promotional, sales
or advertising material relating to the Contracts, Life Company, Variable
Accounts or the underlying mutual funds without the prior written approval of
Life Company or Distributor. Furthermore, Broker-Dealer and General Agent shall
neither use nor authorize the use of the name of Life Company or of an
Affiliate of Life Company, including without limitation MetLife, Inc, MetLife
Investors, and Metropolitan Life Insurance Company, or any other name,
trademark, service xxxx, symbol or trade style that is now or may hereafter be
owned by Life Company or by an Affiliate of Life Company, except in the manner
and to the extent that such use may be specifically authorized in writing by
Life Company or Distributor.
4.11 Market Timing and Other Prohibitions. Broker-Dealer and General Agent
understand and acknowledge that Life Company or Distributor, in their sole
discretion and at any time during the term of this Agreement, may restrict or
prohibit the solicitation, offer or sale of Contracts, and Premiums thereunder
in connection with any so-called "market timing" or "asset allocation" program,
plan, arrangement, or service. Should Life Company or Distributor determine in
its sole discretion that Broker-Dealer or General Agent is soliciting, offering
or selling, or has solicited, offered or sold, Contracts, or Premiums subject
to any so-called "market timing" or "asset allocation" program, plan,
arrangement, or service which is not permitted under this Agreement (an
"unapproved program"), Life Company or Distributor may take action which is
necessary, in its sole discretion, to halt such solicitations, offers or sales.
Furthermore, in addition to any indemnification provided in Article XI and any
other liability that Broker-Dealer
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and General Agent might have, Distributor or Life Company may hold
Broker-Dealer and General Agent liable for any damages or losses, actual or
consequential, sustained by Life Company or Distributor or any of its
Affiliates, as a result of any unapproved program which causes such losses or
damages following solicitation, offer or sale of a Contract or Premium subject
to any unapproved program or similar service made available by or through
Broker-Dealer or General Agent. Notwithstanding any prohibitions which may be
imposed pursuant to this Section 4.11, Broker-Dealer and its registered
representatives who are Agents may provide incidental services in the form of
guidance to applicants and owners of Contracts regarding the allocation of
Premium and Contract value, provided that such services are (i) solely
incidental to Broker-Dealer's activities in connection with the sales of the
Contracts, (ii) subject to the supervision and control of Broker-Dealer, and
(iii) furnished in accordance with rules and procedures prescribed by Life
Company or Distributor.
4.12 Tax Reporting Responsibility. Broker-Dealer and General Agent shall be
solely responsible under applicable tax laws for the reporting of compensation
paid to Agents and for any withholding of taxes from compensation paid to
Agents, including, without limitation, FICA, FUTA, and federal, state and local
taxes.
4.13 Maintenance of Books and Records. General Agent represents that it
maintains and shall maintain such books and records concerning the activities
of Agents as may be required by the appropriate insurance regulatory agencies
that have jurisdiction and that may be reasonably required by Distributor to
reflect adequately the Contracts processed through General Agent. General Agent
shall make such books and records available to Distributor and/or Life Company
at any reasonable time upon written request. Broker-Dealer represents that it
maintains and shall maintain appropriate books and records concerning the
activities of Agents as are required by the SEC, the NASD and other agencies
having jurisdiction and that may be reasonably required by Distributor to
reflect adequately the Contracts processed through Broker Dealer. Broker-Dealer
shall make such books and records available to Distributor and/or Life Company
at any reasonable time upon written request.
4.14 Bonding of Agents and Others. Broker-Dealer represents that all
directors, officers, employees, and registered representatives of Broker-Dealer
who are appointed pursuant to this Agreement as Agents for state insurance law
purposes or who have access to funds of Life Company, including but not limited
to funds submitted with applications for the Contracts or funds being returned
to purchasers of the Contracts, are and shall be covered by a blanket fidelity
bond, including coverage for larceny and embezzlement, issued by a reputable
bonding company. This bond shall be maintained by Broker-Dealer at the
Broker-Dealer's expense. Such bond shall be, at least, of the form, type and
amount required under the NASD Conduct Rules. Distributor may require evidence,
satisfactory to it, that such coverage is in force, and Broker-Dealer shall
give prompt written notice to Distributor of any cancellation or change of
coverage. Broker-Dealer and the General Agent shall also secure and maintain
errors and omissions insurance coverage acceptable to Life Company and covering
Broker-Dealer, General Agent and Agents. Broker-Dealer and General Agent hereby
assign any proceeds received from the fidelity bonding company, errors and
omissions coverage or other liability insurance coverage to Life Company to the
extent of Life Company's loss is due to activity covered by the bond or other
coverage. If there is any deficiency amount, as a result of a deductible
provision or
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otherwise, Broker-Dealer or General Agency shall promptly pay Life Company such
amount on demand, and Broker-Dealer and General Agency hereby indemnifies and
holds harmless Life Company from any such deficiency and from the costs of
collection thereof (including reasonable attorney's fees).
4.15 Reports to Insurers. Broker-Dealer and General Agent shall promptly
furnish to Life Company or its authorized agent any reports and information
that Life Company may reasonably request for the purpose of meeting Life
Company's reporting and recordkeeping requirements under the insurance laws of
any state, under any applicable federal or state securities laws, rules or
regulations, or the rules of the NASD.
ARTICLE V
Responsibilities of Distributor for Marketing Materials and Reports
5.1 Prospectuses and Applications Provided by Distributor. During the term
of this Agreement, Distributor will provide Broker-Dealer and General Agent,
without charge, with as many copies of the Contract Prospectus(es), current
underlying mutual fund Prospectus(es), statements of additional information and
applications for the Contracts, as Broker-Dealer or General Agent may
reasonably request. Upon receipt from Distributor of updated copies of the
Contract Prospectus(es), current underlying mutual fund Prospectus(es),
statements of additional information and applications for the Contracts,
Broker-Dealer and General Agent will promptly discard or destroy all copies of
such documents previously provided to them, except such copies as are needed
for purposes of maintaining proper records. Upon termination of this Agreement,
Broker-Dealer and General Agent will promptly return to Distributor all
Contract Prospectuses, current underlying mutual fund Prospectus(es),
statements of additional information, Contract applications and other materials
and supplies furnished by Distributor to Broker-Dealer or General Agent or to
Agents, except for copies required for maintenance of records.
5.2 Sales Material Provided by Distributor. During the term of this
Agreement, Distributor will be responsible for providing and approving all
promotional, sales and advertising material to be used by Broker-Dealer and
General Agent. Distributor will file such materials or will cause such
materials to be filed with the SEC, NASD, and any state securities regulatory
authorities, as appropriate.
5.3 Information Provide by Distributor. Distributor will compile periodic
marketing reports summarizing sales results to the extent reasonably requested
by Broker-Dealer or General Agent.
ARTICLE VI
Rules of Ethical Conduct
6.1 Principals of Ethical Market Conduct. The rules, policies and directives
to which Broker-Dealer and General Agent are required to conform include the
Principles of Ethical Market Conduct, as adopted from time to time by the
Insurance Marketplace Standards Association (IMSA). Life Company subscribes to
the Principles of Ethical Market Conduct and
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the Code of Ethical Market Conduct in all matters affecting the sale of the
Contracts. Currently, the Principles of Ethical Market Conduct are:
a. To conduct business according to high standards of honesty and
fairness and to render service to its customers which, in the same
circumstances, it would apply to or demand for itself;
b. To provide competent and customer-focused sales and service;
c. To engage in active and fair competition;
d. To provide advertising and sales materials that are clear as to
purpose and honest and fair as to content;
e. To provide for fair and expeditious handling of customer complaints
and disputes;
f. To maintain a system of supervision and review that is reasonably
designed to achieve compliance with the aforementioned Principles of Ethical
Market Conduct.
6.2 Reporting on IMSA Compliance. Broker-Dealer and General Agent shall
furnish information, documentation and reports to Life Company as it may
reasonably request in order to permit Life Company to ascertain whether
Broker-Dealer and General Agent are conducting their operations in accordance
with the Principles of Ethical Market Conduct.
ARTICLE VII
Commissions, Fees and Expenses
7.1 Compensation. During the term of this Agreement, Distributor shall pay
to Broker-Dealer or General Agent, as applicable, commissions and fees set
forth in Schedule I to this Agreement. The payment of such commissions and fees
shall be subject to the terms and conditions of this Agreement and those set
forth on Schedule I. Schedule I, including the commissions and fees therein,
may be amended by Distributor at any time, in any manner, and without prior
notice. Any amendment to Schedule I will be applicable to any Contract for
which any application or Premium is received by the Service Center on or after
the effective date of such amendment. However, Distributor reserves the right
to amend such Schedule with respect to subsequent premiums and renewal
commissions and the right to amend such Schedule pursuant to this subsection
even after termination of this Agreement. Compensation with respect to any
Contract shall be paid to General Agent only for so long as General Agent is
the Broker-of-Record and maintains compliance with applicable state insurance
laws and only while this Agreement is in effect.
7.2 Limitations on Compensation. No compensation shall be payable, and
Broker-Dealer and General Agent agree to reimburse Distributor, for any
compensation that may have been paid to Broker-Dealer, General Agent or any
Agent in any of the following situations: (i) Life Company, in its sole
discretion, determines not to issue the Contract applied for; (ii) Life
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Company refunds the Premium upon the applicant's surrender or withdrawal
pursuant to any "free look" provision; (iii) Life Company refunds the Premium
paid by applicant as a result of a complaint by applicant; (iv) Life Company
determines that any person soliciting an application who is required to be
licensed or any other person or entity receiving compensation for soliciting
applications or Premium for the Contracts is not or was not duly licensed as an
insurance agent; or (v) any other situation listed on Schedule I.
7.3 Agent Commissions. Agents shall have no interest in this Agreement or
right to any commissions to be paid by Distributor to Broker-Dealer or General
Agent. Broker-Dealer or General Agent shall be solely responsible for the
payment of any commission or consideration of any kind to Agents. Broker-Dealer
and General Agent shall have no right to withhold or deduct any commission from
any Premium in respect of the Contract which it may collect unless and only to
the extent that Distributor and Life Company agrees in writing to permit
Broker-Dealer and General Agent to net its commissions against Premium
collected. Broker-Dealer and General Agent shall have no interest in any
compensation paid by Life Company to Distributor or any Affiliate, now or
hereafter, in connection with the sale of any Contracts hereunder.
7.4 Expenses Paid by Broker-Dealer and General Agent. Neither Broker-Dealer
nor General Agent shall, directly or indirectly, expend or contract for the
expenditure of any funds of Distributor or Life Company. Broker-Dealer and
General Agent shall each pay all expenses incurred by each of them in the
performance of this Agreement, unless otherwise specifically provided for in
this Agreement or unless Distributor or Life Company shall have agreed in
advance in writing to share the cost of certain expenses. Initial and renewal
state appointment fees for General Agent and appointees of General Agent as
Agents of Life Company will be paid according to the terms set forth in rules
and procedures as may be adopted by Life Company from time-to-time. Except as
otherwise provided herein, Broker-Dealer or General Agent will be obligated to
pay all state appointment fees, including, but not limited to, renewal
appointment fees not paid for by Life Company, transfer fees and termination
fees, and any other fees required to be paid to obtain state insurance licenses
for Agents.
ARTICLE VIII
Complaints and Investigations
8.1 Investigation and Resolution of Complaints. Life Company, Distributor,
Broker-Dealer and General Agent shall cooperate fully in any insurance
regulatory investigation or proceeding or judicial proceeding arising in
connection with the Contracts marketed under this Agreement. In addition, Life
Company, Distributor, Broker-Dealer and General Agent shall fully cooperate
with each other in any securities regulatory investigation or proceeding or
judicial proceeding with respect to Life Company, Distributor, Broker-Dealer,
General Agent, their Affiliates and their agents, to the extent that such
investigation or proceeding relates to the Contract marketed under this
Agreement. Without limiting the foregoing:
a. Broker-Dealer and General Agent will be notified promptly by
Distributor or Life Company of any customer complaint or notice of any
regulatory investigation or proceeding or judicial proceeding received by
Distributor or Life Company with respect to
12
Broker-Dealer, General Agent or any Agent which may relate to the issuance of
any Contract marketed under this Agreement.
b. Broker-Dealer and General Agent will promptly notify Distributor and
Life Company of any customer complaint or notice of any regulatory
investigation or proceeding or judicial proceeding received by Broker-Dealer or
General Agent or their Affiliates with respect to themselves, their Affiliates
or any Agent in connection with any Contract marketed under this Agreement or
any activity in connection with any such Contract.
c. The term "customer complaint" shall mean an oral or written
communication either directly from the purchaser of or applicant for a Contract
covered by this Agreement or from his/her legal representative, or indirectly
from any regulatory agency to which he/she or his/her legal representative has
expressed a grievance.
d. The full cooperation referred to in Subsections 8.1a and 8.1b above
shall include, but is not limited to, requiring each party to promptly notify
the other parties of the receipt of notice of any such investigation,
proceeding, or customer complaint, forwarding to the other parties a copy of
any written materials in connection with the matter (or a written statement of
an oral complaint), providing such additional information as may be necessary
to furnish a complete understanding of same, and, in the case of a customer
complaint, consulting with the other parties prior to responding thereto and
thereafter providing each party with copies of all written responses.
ARTICLE IX
Customer Information
9.1 Receipt of Customer Information by Life Company. Distributor and Life
Company will treat customer information provided to it by Broker-Dealer and
General Agent under this Agreement as Confidential Information under
Section 10.1 of this Agreement, except that such provisions shall not apply to
any information provided by or received from others concerning customers of
Broker-Dealer and General Agent who were, are or become policyholders or
customers of Life Company or any of its Affiliates other than by reason of the
products or services provided by Life Company under this Agreement.
9.2 Uses of Customers Information. Notwithstanding the foregoing, Life
Company and its Affiliates shall have the right to use Broker-Dealer and
General Agent customer information:
a. To the full extent required to comply with laws, rules and
regulations or requests of regulators;
b. As necessary in connection with any of Life Company's compliance or
accounting procedures; and
c. To provide customer service to purchasers of Contracts under this
Agreement. Life Company and its Affiliates may market, offer, sell or
distribute insurance
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products, including, but not limited to, the Contracts, or any of their other
products and related services, outside of this Agreement to customers of
Broker-Dealer or General Agency provided they do not use customer information
provided by Broker Dealer or General Agent to identify or target customers, and
such marketing, offering, selling or distributing by Life Company or its
Affiliates of insurance (including but not limited to the Contracts) or any of
their other products or services shall not be subject to the terms of this
Agreement.
9.3 Receipt of Customer Information by Broker-Dealer and General Agent.
Broker-Dealer and General Agent will treat nonpublic personal information
regarding Broker-Dealer's or General Agent's customers provided to it by
Distributor or Life Company under this Agreement as Confidential Information
under Section 10.1 and shall use such information only to solicit sales of and
to provide service with respect to Contracts sold pursuant to this Agreement.
Notwithstanding the foregoing, Broker shall have the right to use or disclose
nonpublic personal information provided to it by Distributor or Life Company to
the extent permitted by applicable law and Life Company's privacy policy, for
example, to comply with applicable law or requests of regulators, in connection
with audit procedures, as authorized by such customers, and to protect against
or prevent fraud.
ARTICLE X
Confidentiality, Privacy
10.1 Confidential Information. Life Company, Distributor, Broker-Dealer and
General Agent shall not disclose any Confidential Information that is covered
by this Agreement, and shall only disclose such information if authorized in
writing by the affected party or if expressly required under the terms of a
valid subpoena or order issued by a court of competent jurisdiction or
regulatory body or applicable laws and regulations. "Confidential Information"
under this Section 10.1 means:
a. Any information that this Agreement specifies will be treated as
"Confidential Information" under this Section 10.1;
b. Any information of Broker-Dealer and General Agent disclosed to
Distributor or Life Company through the course of business during the term of
this Agreement, or any information of Distributor or Life Company that is
disclosed to Broker-Dealer or General Agent through the course of business
during the term of this Agreement, in each such case if such information is
clearly identified as and marked "confidential" by the disclosing party, such
information includes, but is not limited to, new products, marketing strategies
and materials, development plans, customer information, client lists, pricing
information, rates and values, financial information, and computer systems; and
c. Information required to be treated as confidential under applicable
laws, rules and regulations.
10.2 Excluded Information. "Confidential Information" does not include
(i) information which is now generally available in the public domain or which
in the future enters
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the public domain through no fault of the receiving party; (ii) information
that is disclosed to the receiving party by a third party without violation by
such third party of an independent obligation of confidentiality of which the
receiving party is aware; or (iii) information that the disclosing party
consents in writing that the receiving party may disclose.
10.3 Warranties and Limitations on Liability.
a. The disclosing party warrants that it has the right to provide access
to, disclose and use, the Confidential Information to be provided hereunder.
b. The receiving party shall not be liable to the other parties for:
(i) Inadvertent use, publication, or dissemination of the
Confidential Information received hereunder provided that: (a) it uses the same
degree of care in safeguarding such information as it uses for its own
information of like importance; and (b) upon discovery of such, it shall take
appropriate steps to prevent any further inadvertent use, publication, or
dissemination; and/or
(ii) Unauthorized use, publication or dissemination of the
Confidential Information received hereunder by persons who are or have been in
its employ, unless it fails to safeguard such information with the same degree
of care as it uses for its own proprietary information of like importance and
provided that the receiving party uses such Confidential Information in
accordance with applicable laws.
c. Any similarity between the Confidential Information and any other
information, regardless of medium, whether verbal or written, as well as
contracts and/or services acquired from third parties or developed by the
receiving party, or Affiliates independently through its or their own efforts,
thought, labor and ingenuity shall not constitute any violation of this
Agreement and shall not subject the receiving party to any liability whatsoever.
d. The receiving party shall use the Confidential Information solely for
purposes contemplated by this Agreement and shall not disclose the Confidential
Information except as expressly provided herein.
e. In the event the receiving party receives a request to disclose all
or any part of the Confidential Information under the terms of a valid subpoena
or order issued by a court of competent jurisdiction or by a governmental body,
the receiving party agrees to: (i) notify the disclosing party promptly of such
request; and (ii) provide the disclosing party with reasonable assistance in
obtaining an order or other reliable assurances that confidential treatment
will be accorded to such portion of the Confidential Information that the
disclosing party so designates.
f. The receiving party understands that neither the disclosing party nor
any of its representatives or designees have made or make any representation or
warranty as to the accuracy or completeness of the Confidential Information.
15
ARTICLE XI
Indemnification
11.1 Indemnification by Broker-Dealer and General Agent. Broker-Dealer and
General Agent, jointly and severally, shall indemnify and hold harmless
Distributor and Life Company, and each person who controls or is associated
with Distributor or Life Company within the meaning of such terms under the
federal securities laws, and any officer, director, employee or agent of the
foregoing, against any and all losses, claims, damages or liabilities, joint or
several (including any investigative, legal and other expenses reasonably
incurred in connection with, and any reasonable amounts paid in settlement of,
any action, suit or proceeding or any claim asserted), to which they or any of
them may become subject under any statute or regulation, at common law or
otherwise as such losses, claims, damages or liabilities arise out of or are
based upon any actual or alleged negligent, improper, fraudulent or
unauthorized acts or omissions by Broker-Dealer or General Agent or any Agent,
including without limitation:
a. Violation(s) by Broker-Dealer, General Agent or an Agent of federal
or state securities law or regulations, insurance law or regulations(s), or any
rule or requirement of the NASD;
b. Unauthorized use of sales or advertising material, any oral or
written misrepresentations, or any unlawful sales practices concerning the
Contracts, by Broker-Dealer, General Agent or an Agent;
c. Claims for the unlawful payment of compensation by Life Company or
Distributor or claims by Agents or other agents or representatives of General
Agent or Broker-Dealer for commissions or other compensation or remuneration of
any type;
d. Any failure on the part of Broker-Dealer, General Agent, or an Agent
to submit Premium or applications to Life Company, or to submit the correct
amount of a Premium, on a timely basis and in accordance with this Agreement;
e. Any failure on the part of Broker-Dealer, General Agent, or an Agent
to deliver Contracts to purchasers thereof on a timely basis as provided in
this Agreement; or
f. A breach by Broker-Dealer or General Agent of any provision of this
Agreement.
This indemnification will be in addition to any liability which Broker-Dealer
and General Agent may otherwise have.
11.2 Indemnification by Distributor and Life Company. Distributor and Life
Company, jointly and severally, shall indemnify and hold harmless Broker-Dealer
and General Agent and each person who controls or is associated with
Broker-Dealer or General Agent within the meaning of such terms under the
federal securities laws, and any officer, director, employee
16
or agent of the foregoing, against any and all losses, claims, damages or
liabilities, joint or several (including any investigative, legal and other
expenses reasonably incurred on connection with, and any reasonable amounts
paid in settlement of, any action, suit or proceeding or any claim asserted),
to which they or any of them may become subject under any statute or
regulation, at common law or otherwise, insofar as such losses, claims, damages
or liabilities arise out of or are based upon any breach by Distributor or Life
Company of any provision of this Agreement. This indemnification will be in
addition to any liability that Distributor and Life Company may otherwise have.
11.3 Notice of Indemnification and Rights. After receipt by a party entitled
to indemnification ("indemnified party") under this Article XI of notice of the
commencement of any action, if a claim in respect thereof is to be made against
any person obligated to provide indemnification under this Article XI
("indemnifying party"), such indemnified party will notify the indemnifying
party in writing of the commencement thereof as soon as practicable thereafter,
provided that the omission to so notify the indemnifying party will not relieve
it from any liability under this Article XI, except to the extent that the
omission results in a failure of actual notice to the indemnifying party and
such indemnifying party is damaged as a result of the failure to give such
notice. The indemnifying party will be entitled to participate in the defense
of the indemnified party but such participation will not relieve such
indemnifying party of the obligation to reimburse the indemnified party for
reasonable legal and other expenses incurred by such indemnified party in
defending himself, herself or itself. The indemnification provisions contained
in this Article XI shall remain operative in full force and effect, regardless
of any termination of this Agreement. A successor by law of Distributor or Life
Company, as the case may be, shall be entitled to the benefits of the
indemnification provisions contained in this Article XI.
ARTICLE XII
Term and Termination
12.1 Term. This Agreement shall continue in force for a term of one year
from the Effective Date and thereafter shall automatically be renewed each year
for a further one-year period, provided that any party may unilaterally
terminate this Agreement with or without cause upon thirty (30) days prior
written notice of termination to the other parties.
12.2 Automatic Termination. This Agreement, shall automatically terminate
upon its breach by a party hereto provided that such breach is not cured within
thirty (30) days of written notice of the breach given to the breaching party,
or in the event the Distributor or Broker-Dealer ceases to be a registered
broker-dealer, a member of the NASD, or General Agent ceases to be properly
licensed or upon the filing by any party hereto for protection under any state
or federal bankruptcy.
12.3 Continuation Certain Agreements. In the event of termination of the
Agreement, all authorization rights and obligations shall cease except for the
agreements of the parties contained in Articles VIII, IX, X, and XI.
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ARTICLE XIII
Miscellaneous
13.1 Headings. The headings in this Agreement are included for convenience
of reference only and in no way define or delineate any of the provisions
hereof or otherwise affect their construction or effect.
13.2 Counterparts. This Agreement may be executed in two or more
counterparts, each of which taken together shall constitute one and the same
instrument.
13.3 Severability. If any provision of this Agreement shall be held or made
invalid by a court decision, statute, rule or otherwise, the remainder of this
Agreement shall not be affected thereby.
13.4 Notices. All notices under this Agreement shall be given in writing and
addressed as follows:
If to Life Company:
MetLife Investors Insurance Company
00 Xxxxxxxxx Xxxxx Xxxxx
Xxxxxxx Xxxxx, XX 00000
Attention: Installations
If to Distributor:
MetLife Investors Distribution Company
00 Xxxxxxxxx Xxxxx Xxxxx
Xxxxxxx Xxxxx, XX 00000
Attention: Installations
If to Broker-Dealer or General Agent:
Xxxxxx Xxxxxxx XX Inc.
0000 0xx Xxxxxx
00xx Xxxxx
Xxx Xxxx, XX 00000
Attn: ________________
or to such other address as such party may hereafter specify in writing. Each
such notice shall be either hand delivered or transmitted by certified United
States mail, return receipt requested, and shall be effective upon delivery.
13.5 Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of California, excluding its conflict of
laws provisions.
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13.6 Scope of Sales Material References. For purposes of this Agreement, all
references to sales, promotional, marketing, or advertising material shall
include, without limitation, advertisements (such as material published, or
designed for use in, a newspaper, magazine or other periodical, radio,
television, telephone or tape recording, videotape display, signs or
billboards, motion pictures or other public media), sales literature (i.e., any
written communication distributed or made generally available to customers or
the public, including brochures, circulars, research reports, market letters,
form letters, seminar tests, reprints or excerpts of any other advertisement,
sales literature or published article), and educational or training materials
or other communications distributed or made generally available to some or all
Agents or employees of Broker-Dealer or General Agent.
13.7 No Waiver of Rights. The rights, remedies and obligations contained in
this Agreement are cumulative and are in addition to any and all rights,
remedies and obligations, at law or in equity, which the parties hereto are
entitled to under state and federal laws. Failure of any party to insist upon
strict compliance with any of the conditions of this Agreement shall not be
construed as a waiver of any of the conditions, but the same shall remain in
full force and effect. No waiver of any of the provisions of this Agreement
shall be deemed or shall constitute a waiver of any other provisions, whether
or not similar, nor shall any waiver constitute a continuing waiver,
13.8 Scope of Agreement. All schedules and Exhibits to this Agreement are
part of the Agreement.
13.9 Arbitration. It is understood that the following agreement to arbitrate
by the parties does not constitute a waiver of the right to seek a judicial
forum to the extent that such a waiver would be void under applicable law.
a. The parties each agree that, except as inconsistent with the
preceding sentence, all claims or controversies, and any related issues, which
may arise at any time between the parties (including their directors, officers,
employees, representatives, or agents) with respect to any subject matter; any
transaction, order, or direction; any conduct of the parties or their
directors, officers, employees, representatives, or agents; any construction,
performance, or breach of this Agreement or any other agreement between the
Parties, whether entered into prior to, on, or subsequent to the date hereof;
any breach of any common law or statutory duty; or any violation of any federal
or state law of any nature shall be resolved by binding arbitration other than
by lawsuit in a court of law or equity.
b. Any arbitration pursuant to this Agreement shall be in accordance
with and governed by a mutually agreeable arbitration forum, but in the absence
of such agreement, the Code of Arbitration Procedure of the NASD, if the NASD
accepts jurisdiction, and, if not, then the American Arbitration Association.
There shall be at least three arbitrators unless otherwise agreed by the
parties. The award of the arbitrators, or of the majority of them, shall be
final and binding upon the parties, and judgment upon the award rendered may be
entered in any federal or state court having jurisdiction. Any arbitration
shall be commenced by delivery to the other party of a written demand for
arbitration setting forth in detail the claim or controversy to be arbitrated.
19
c. The arbitrators shall be entitled to order specific performance of
the obligations imposed by this Agreement.
d. Unless the arbitrators shall provide otherwise, each party will be
responsible for (i) all fees and expenses of its respective counsel,
accountants, actuaries and any other representatives in connection with the
arbitration and (ii) one-half ( 1/2) of expenses of the arbitration, including
the fees and expenses of the arbitrators.
13.10 Money Laundering, Foreign Assets Control. Life Company, Distributor,
Broker Dealer and General Agency agree to comply with all applicable anti-money
laundering laws, regulations, rules and government guidance, including the
reporting, recordkeeping and compliance requirements of the Bank Secrecy Act
("BSA"), as amended by the International Money Laundering Abatement and
Financial Anti-Terrorism Act of 2002, Title III of the USA PATRIOT Act ("the
Act"), its implementing regulations, and related SEC and NASD rules. These
requirements include requirements to identify and report currency transactions
and suspicious activity, to verify customer identity, to conduct customer due
diligence, and to implement anti-money laundering compliance programs. Each
party represents to the other parties that, to the extent required by the Act,
it will establish and maintain a comprehensive anti-money laundering compliance
program.
The parties further agree to comply with the economic sanctions programs
administered by the U.S. Treasury Department's Office of Foreign Assets Control
("OFAC" and, to the extent required by such programs, establish and maintain a
comprehensive compliance program which includes, among other things, procedures
for checking customer names and wire transfers against OFAC lists.
The parties agree to promptly notify the other parties whenever questionable
activity or potential indications of suspicious activity or OFAC matches are
detected. Each party agrees to cooperate with the other parties in the
investigation of any potentially suspicious activity and to take appropriate
action, to the extent required by law, including the clocking of accounts, the
filing of Suspicious Activity Reports and the reporting of matches to OFAC, in
connection with the Contracts.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective duly approved officers.
BROKER-DEALER:
XXXXXX XXXXXXX XX INC.
By: /s/ Xxxxxxx Xxxxxxx
-----------------------------------
Name: Xxxxxxx Xxxxxxx
Title: VP
GENERAL AGENT:
XXXXXX XXXXXXX XX INC
By: /s/ Xxxxxxx Xxxxxxx
-----------------------------------
Name: Xxxxxxx Xxxxxxx
Title: VP
METLIFE INVESTORS INSURANCE COMPANY
By: /s/ Xxxxxxx X. Xxxxxxx
-----------------------------------
Xxxxxxx X. Xxxxxxx
Exec. Vice President
METLIFE INVESTORS DISTRIBUTION COMPANY
By: /s/ Xxxxxxx X. Xxxxxxx
-----------------------------------
Xxxxxxx X. Xxxxxxx
President
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