SELLING AGREEMENT
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[Identify broker/dealer firm]
("Your Broker/Dealer")
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[and associated insurance agency(ies)]
("Your Agency")
Ladies and Gentlemen:
Pursuant to a Wholesaling Agreement entered into on ___________ , 1999,
by American Enterprise Life Insurance Company (the "Company"), American Express
Service Corporation (the "Distributor," together with Company, "American
Express") and Xxxxxxx, Xxxxx & Co. and Xxxxxxx Sachs Insurance Agency, Inc.
(together, "Wholesaler"), Your Broker/Dealer and Your Agency have been
recommended to us to be a selling firm authorized to offer and sell certain
variable annuity contracts ("Authorized Selling Firm or "You") issued by Company
and distributed by Distributor (the "Variable Contracts"). The Variable
Contracts are described on Schedule A, including contracts that may be added to
Schedule A to this Agreement from time to time in accordance with Section 13,
and may be designated with a marketing name including the term "Xxxxxxx Xxxxx."
This agreement (hereafter the "Selling Agreement" or "Agreement")
confirms our mutual agreement as to the terms and conditions applicable to your
activities as an Authorized Selling Firm. In executing this Agreement, You
understand that (1) Distributor or its affiliates may, at any time at its or
their option, act as an Authorized Selling Firm; (2) American Express may enter
into agreements, which may or may not be the same as this Agreement, with other
Authorized Selling Firms; (3) Company or Distributor may modify, suspend,
terminate or withdraw entirely the offering of Variable Contracts at any time
without notice to You and without incurring any liability or obligation to You;
(4) Company may, upon notice, change the sales charge applicable to any Variable
Contract; and (5) American Express shall have no liability to You or to your
customers except for lack of good faith and for obligations expressly assumed by
American Express pursuant to this Selling Agreement.
1. Authorization. Company hereby appoints Your Agency and Distributor
and hereby authorizes Your Broker/Dealer to solicit sales of and to sell
Variable Contracts pursuant to the terms of this Agreement as an Authorized
Selling Firm. You hereby accept such appointment and authorization. Company will
file all necessary appointment forms with state insurance regulators, subject to
your compliance with the obligations related to such appointments under Sections
2(b) and (c). Unless otherwise terminated, this Agreement shall last one year,
beginning upon the date of its execution by American Express ("Effective Date").
This Agreement automatically renews on its anniversary for successive, one-year
periods, unless any party gives notice of non-renewal.
2. Your Duties and Obligations. As an Authorized Selling Firm, You
undertake to perform the following duties and obligations.
(a) Supervision of Representatives. Your Agency and Your
Broker/Dealer shall have full, joint and several responsibility for the training
and supervision of all of your associated persons ("Representatives") who are
engaged directly or indirectly in the offer or sale of the Variable Contracts,
and all such Representatives shall be subject to your control with respect to
their securities and insurance regulated activities in connection with the
Variable Contracts. Authorized Selling Firm shall be responsible for ensuring
that their Representatives who market and sell the Variable Contracts are
trained on (i) the product specifications and features, (ii) requirements that
Company has adopted to satisfy insurance laws and regulations regarding
replacements, and (iii) standards that Company has established for Authorized
Selling Firms and their Representatives to use in meeting their respective
duties to ensure suitable sales of the Variable Contracts. The training material
regarding product specifications and features, and the requirements described in
(ii) and (iii) above shall either be the training material for the Variable
Contract provided by the Company to the Authorized Selling Firm that is
contained in the new sales representative kit ("Procedures and Resource
Manual"), or if different training material is used by the Authorized Selling
Firm it shall be provided to American Express prior to the execution of this
Agreement. After the execution of this Agreement, to the extent that Authorized
Selling Firm uses training material related to the sale of the Variable
Contracts that is materially different from that contained in the Procedures and
Resource Manual or other training material provided to American Express in
accordance with the preceding sentence, Authorized Selling Firm must provide
that training material to American Express. Authorized Selling Firm shall be
responsible for assuring that its Representatives complete the training before
they begin to sell the Variable Contracts. Authorized Selling Firm shall also be
responsible for assuring that their Representatives satisfy the minimum
requirements of the Company and Distributor described in (ii) and (iii) above,
and the suitability requirements of the National Association of Securities
Dealers, Inc. ("NASD"), Securities and Exchange Commission ("SEC") and any state
law, as amended from time to time, in selling the Variable Contracts. You will
establish and maintain such rules and procedures as may be necessary to cause
diligent supervision of the securities and insurance activities of your
Representatives as required by applicable law or regulation. You will provide
your Representatives advice and assistance with regard to marketing and
advertising of Variable Contracts, and will assist Representatives in responding
to customer inquiries. You will promptly deliver to Representatives relevant
Company communications and instructions, bulletins, manuals and underwriting
guides issued in writing by Company ("Company Rules") concerning the Variable
Contracts. With regard to sales solicitations by your Representatives, You will
review all Variable Contract applications for accuracy and completeness, and to
determine and ensure the suitability of the sale and will ensure that You and
your Representatives document transactions, including the fact of policy
delivery, and maintain any other documentation reasonably requested by Company.
(b) Licensing, Registration and Appointment. You will not
allow any of your Representatives to solicit or sell Variable Contracts unless
such Representative is qualified under applicable federal and state securities
laws to engage in the sale of the Variable Contracts, is a registered person of
Your Broker/Dealer and is validly insurance licensed and appointed by Company as
a variable contract agent in accordance with the jurisdictional requirements of
the place where the solicitations and sales take place as well as in accordance
with the solicited person's or entity's place of residence. You will assist
Company in the appointment of your Representatives under applicable insurance
laws and will fulfill all Company Rules in conjunction with the submission of
appointment papers for Representatives as insurance agents of Company. Company
will be responsible for the filing of appointments with the state insurance
departments. Notwithstanding such submission, as between the parties, Company
shall have sole discretion to appoint, refuse to appoint, discontinue, or
terminate the appointment of any Representative as an insurance agent of
Company. Your Broker/Dealer will be solely responsible for securities
registrations of Representatives. Your Broker/Dealer and Your Agency will be
responsible for continuously maintaining for each of your Representatives the
required federal and state securities registrations and insurance licenses in
the state(s) where such Representatives will solicit and sell Variable Contracts
and have been appointed by Company in accordance with the laws of the state in
which the sale(s) occur and the customer resides. You will notify Company if any
Representative fails to maintain the required NASD registration, or state
insurance license, becomes inactive, is terminated or no longer employed by You,
or is no longer authorized to sell Variable Contracts. You will limit the
Variable Contracts solicitation activities of each of your Representatives to
the jurisdictions where American Express has authorized such solicitation. These
jurisdictions (and any applicable Affiliated Agencies, as defined in Section
8(a)) are listed on Schedule A to this Agreement.
(c) Representative Background Checks. Authorized Selling Firm
is responsible for performing background checks on any Representative prior to
his or her appointment with Company. You warrant that such background check will
comply with all applicable regulations of the departments of insurance and
securities in the states in which the Representative will solicit and sell
Variable Contracts, and with the requirements of the NASD. You further warrant
and represent that copies of such background check reports will be made
available in a timely manner to any regulator who may request them from Company,
and that Company will receive confirmation that such materials have been timely
delivered to any such regulator. Company will not require copies of the reports
themselves, but only the assurance that they have been timely delivered as
requested, unless such reports relate or may relate to a customer inquiry or
complaint about the Variable Contract or its sale, or unless such report relates
to Company's internal investigation of a Representative's sales practices with
regard to the Variable Contracts. You further warrant and agree that You will
provide to the Company a copy of your procedures and requirements for background
checks upon request, and acknowledge that Company is entitled to rely on You for
compliance with regulations as indicated above. With regard to Representatives
who will be soliciting sales of Variable Contracts in the states of Alabama or
Mississippi, Company retains the right to conduct background checks on
Representatives at its own initiative and expense.
(d) Use and Delivery of Prospectus and Marketing Materials. In
offering the Variable Contracts, You and your Representatives shall rely solely
on representations contained in the prospectus and registration statements as
most recently amended or supplemented for the Variable Contracts. You shall not
furnish or communicate to any person any information relating to the Variable
Contracts, the Company, Distributor, or Wholesaler, that is inconsistent with
information contained in the relevant prospectus or registration statements or
in marketing materials supplied by the Company or the Wholesaler. You will
ensure that your Representatives deliver to each person submitting an
application for a Variable Contract the applicable prospectus as prescribed by
applicable securities laws and regulations.
(e) Preparation of Marketing Materials and Use of Trademarks.
You will not publish or use any marketing materials relating to the Variable
Contracts, the Company, Distributor or Wholesaler without prior written consent
from each of the aforementioned entities. You jointly and severally agree to
indemnify and hold harmless, Company, Distributor, and Wholesaler, against any
liabilities (including costs of investigation and defense) to which any of these
entities may become subject in respect of any such materials that is furnished
to any person, published or used without the above-described prior written
consent. You shall not use the names, logos, trademarks, service marks or any
proprietary designation of American Express or Wholesaler without their
respective prior written permission. In the event that You are notified by the
Company, Distributor or Wholesaler, that any marketing or sales material is no
longer to be used or distributed, You shall immediately cease to use any such
material and follow Company Rules and direction as to its disposal. All
prospectuses, sales promotion material, advertising, circulars, documents and
software relating to the sale of Variable Contracts are property of Company and
Wholesaler, as applicable. You will safeguard, maintain and account for these
materials and will destroy them upon termination of this Agreement, according to
Company Rules.
(f) Acceptance/Rejection of Applications, Premiums and other
Requests. All applications, premiums and other orders are to be submitted to
Company in accordance with Company Rules, as provided from time to time. All
applications and premiums for the Variable Contracts are subject to acceptance
or rejection by the Company in its sole discretion. All other requests are
subject to the satisfaction of relevant conditions set forth in the applicable
prospectus or contract form.
(g) Collection and Submission of Premiums. Company and
Authorized Selling Firm will agree on which of the following provisions will
govern Authorized Selling Firm's duties related to collection and submission of
premiums:
(i) Check with Application. You will assure your Representatives'
collection and timely remittance to Company of the premiums due on all
Variable Contracts. Company will receive premiums no later than the second
business day after the application has been signed by the customer.
(ii) Gross Sweep. You will assure your Representatives' collection of
the premiums due on all Variable Contracts and will timely account for such
premiums, directly depositing them no later than the next business day into
a Company-owned bank account and notifying Company immediately of the gross
deposits for the business day. Upon receipt of notification from You,
Company will sweep the settlement account. Additional specific procedures
governing the movement of money pursuant to this paragraph will be
established by Your Agency, Your Broker/Dealer, Company and Distributor and
will become part of the Company Rules.
(h) Policy Delivery. Company will transmit Variable Contracts
directly to contract holders.
(i) Replacements. In the event a prospective purchaser is
considering the surrender or exchange of an existing insurance policy or
variable annuity contract in order to purchase a Variable Contract from You or
any of your Representatives (hereafter a "Replacement Sale"), You shall ensure
that Representatives provide sufficient information to prospective annuity
contract-holders as to the suitability of the Replacement Sale. Such information
includes but may not be limited to: completion of the Company's "Annuity to
Variable Annuity Replacement Form;" the amount of the surrender charge to be
incurred on the investment to be liquidated; all fees and possible charges, such
as surrender charges, on the new investment(s); any change in the investment
risk to the prospective annuity contract-holder; any change in the nature or the
provider of any guarantees associated with the surrendered annuity contract; any
changes in the expenses associated with the surrendered annuity contract; and
loss of favorable tax treatment of annuity contracts issued prior to October 22,
1988. Sales of annuities under this Agreement which are funded by the surrender
of cash value life insurance policies will not be accepted by Company. You shall
retain all such information for seven years counting from the date of the
initial solicitation, whether or not the Variable Contract was ever sold, and
shall make such information available to the Company upon request.
(j) Compliance with NASD Rules and Federal and State
Securities Laws. You will fully comply with the requirements of the NASD, the
Securities Exchange Act of 1934 (the "1934 Act") and all other applicable
federal and state laws, as well as Company Rules, as amended from time to time,
and provided to You.
(k) Violation of Law; Complaints. You will promptly notify
American Express in writing of any complaint, violation of law or Company Rules
by Authorized Selling Firm or any of your Representatives, or of any allegation
by a customer or regulatory agency with respect to the activities of Authorized
Selling Firm or a Representative with respect to the Variable Contracts. For
purposes of this Section, "complaint" means oral or written notice, as required
by law, received by Authorized Selling Firm (without regard to who was the
original receiver or addressee) expressing dissatisfaction either with the
Variable Contract or with representations which induced its purchase.
(l) Limitations. Authorized Selling Firm shall have no
authority with respect to Company, nor shall either represent themselves as
having such authority, other than as is specifically set forth in this
Agreement. Specifically, and without limiting the foregoing, Authorized Selling
Firm shall not, without the express written consent of Company and/or
Distributor, as applicable:
i. make, waive, alter or change any term, rate or
condition stated in any Company contract or Company- or
Distributor-approved form, or discharge any contract in
the name of Company;
ii. waive a forfeiture;
iii. extend the time for the payment of premiums or other
monies due Company;
iv. institute, prosecute or maintain any legal proceedings
on behalf of Company or Distributor in connection with
any matter pertaining to Company's business, nor accept
service of process on behalf of Company or Distributor;
v. transact business in contravention of the rules and
regulations of any insurance department and/or other
governmental authorities having jurisdiction over any
subject matter embraced by this Agreement;
vi. make, accept or endorse notes, or endorse checks
payable to Company or Distributor, or otherwise incur
any expense or liability on behalf of Company or
Distributor;
vii. offer to pay or pay, directly or indirectly, any rebate
of premium or any other inducement not specified in the
Variable Contract to any owner or annuitant;
viii.misrepresent the Variable Contract for the purpose of
inducing an annuity contract-holder in any other
company to lapse, forfeit or surrender his/her
insurance therewith;
ix. give or offer to give any advice or opinion regarding
the taxation of any customer's income or estate in
connection with the purchase of any Variable Contract;
x. use Company's, Distributor's or Wholesaler's names,
logos, trademarks, service marks or any other
proprietary designation except as provided in Section
2(e) herein;
xi. engage in any program designed to replace Variable
Contracts sold hereunder with any annuity products of
other companies, at any time while this Agreement is in
force; or provide data to any other person or
organization which would allow or facilitate such
replacement of Company's Variable Contracts.
3. Expenses. Except as otherwise provided in this Agreement, Authorized
Selling Firm will be responsible for all costs and expenses of any kind and
nature incurred by Authorized Selling Firm in the performance of their duties
under this Agreement.
4. Books, Records and Bonding
(a) Books and Records. As required by applicable law and
Company Rules, You will keep identifiable and accurate books, accounts and
records of all business and transactions effected under this Agreement. Upon
reasonable notice and at reasonable times, for a period continuing one year
following the termination of this Agreement, You will permit American Express to
visit or inspect, audit and verify, and to make copies of, at your offices or
elsewhere, all such documents You maintain in accordance with this Agreement,
provided such audit will not unreasonably interfere with your normal course of
business.
(b) Fidelity Bond. Authorized Selling Firm represents and
warrants that all directors, officers, employees and representatives of
Authorized Selling Firm, and Representatives who are appointed pursuant to this
Agreement as producers for Company or who have access to funds of Company,
including but not limited to funds submitted with applications for Variable
Contracts or funds being returned to owners, are and shall be covered by a
blanket fidelity bond, including coverage for larceny and embezzlement, issued
by a reputable bonding company. The bond shall be maintained by Your
Broker/Dealer at Your Broker/Dealer's expense. Company may require evidence,
satisfactory to it, that such coverage is in force. Authorized Selling Firm
shall give prompt written notice to Company of cancellation or change of
coverage.
5. Ownership of Customer and Prospect Information. The names, addresses
and other personally identifiable or account information concerning your
prospects and customers are and shall remain your sole property, and neither
American Express nor its affiliates shall use such information for any purpose
except in connection with the performance of its duties and responsibilities
hereunder and except for servicing and mailings related to the Variable
Contracts. Notwithstanding the foregoing, (a) this Section 5 shall not prohibit
American Express or any of its affiliates from utilizing for any purpose the
names, addresses or other personally identifiable or account information
concerning any of your prospects or customers if such names, addresses and other
personally identifiable or account information are obtained in the ordinary
course of business in any manner other than from You pursuant to this Selling
Agreement, and (b) in the event You, during the term of this Agreement and for a
period of one year after the effective date of its termination, engage in a
concerted effort to promote, recommend or encourage the termination, surrender,
or cancellation of any Variable Contract sold under this Agreement, without
reasonable grounds to believe that such promotion, recommendation or
encouragement is in each individual customer's best interests, then the
provisions relating to Section 11, Confidentiality, and this Section 5 shall be
void as regards American Express' right to contact present and former purchasers
of the Variable Contract sold under this Agreement with a view to retaining the
accounts. The provisions of this Section 5 shall survive the termination of this
Agreement.
6. Commissions. Company shall pay You commissions for your services
under this Agreement, based on premiums accepted by Company, as set forth in
Schedule A to this Agreement, as amended from time to time. Commissions shall be
paid to You on a monthly basis. Authorized Selling Firm will be responsible for
payment of commissions to Representatives for sales of Variable Contracts under
this Agreement. In determining the amount of commission payable to You, Company
reserves the right to exclude any sales that Company reasonably determines are
not made in accordance with the terms of the prospectus or the provisions of
this Agreement. Company will charge back the appropriate portion of your
commissions set forth on Schedule A for surrenders of Variable Contracts, also
in accordance with Schedule A.
7. Indemnification
(a) Indemnification by American Express. The Company or
Distributor shall indemnify and hold You harmless from and against any and all
losses, claims, damages, liabilities, actions, costs or expenses to which You
may become subject (including any legal or other expenses incurred by You in
connection with investigating any claim against You and defending any action
and, provided American Express has given prior written approval of such
settlement or compromise, which consent will not be unreasonably withheld or
delayed, any amounts paid in settlement or compromise) insofar as such losses,
claims, damages, liabilities, actions, costs or expenses arise out of or are
based upon:
(i) acts or omissions of American Express, or any
employee or agent of American Express (excluding
Authorized Selling Firm or its Representatives) while
acting (whether under actual or apparent authority,
or otherwise) on behalf of American Express in
connection with this Agreement;
(ii) any breach of any written promise or agreement made
by American Express under this Agreement;
(iii) any inaccuracy or breach of any representation or
warranty made by American Express under this
Agreement.
Notwithstanding the above, You shall not be entitled to
indemnification pursuant to this Section 7(a) if such loss, claim, damage,
liability, action, cost or expense is due to the willful misfeasance, bad faith,
gross negligence or reckless disregard of duty by You.
(b) Indemnification by You. You shall indemnify, defend and
hold harmless American Express from and against any and all losses, claims,
damages, liabilities, actions, costs or expenses to which You may become subject
(including any legal or other expenses incurred by You in connection with
investigating any claim against You and defending any action and, provided
American Express has given prior written approval of such settlement or
compromise, which consent will not be unreasonably withheld or delayed, any
amounts paid in settlement or compromise) insofar as such losses, claims,
damages, liabilities, actions, costs or expenses arise out of or are based upon:
(i) acts or omissions of Authorized Selling Firm or any
employee or agent of Authorized Selling Firm,
including its Representatives, while acting (whether
under actual or apparent authority, or otherwise) on
behalf of Authorized Selling Firm or American Express
in connection with this Agreement;
(ii) any breach of any written promise or agreement made
by Authorized Selling Firm under this Agreement;
(iii) any inaccuracy or breach of any representation or
warranty made by Authorized Selling Firm under this
Agreement.
This indemnification obligation shall not apply to the extent that such alleged
act or omission is attributable to American Express either because (1) American
Express directed the act or omission or (2) Authorized Selling Firm or
Representative's act or omission was the result of its compliance with the
Company Rules.
Notwithstanding the above, American Express shall not be
entitled to indemnification pursuant to this Section 7(b) if such loss, claim,
damage, liability, action, cost or expense is due to willful misfeasance, bad
faith, gross negligence or reckless disregard of duty by American Express.
(c) General. After receipt by a party, or any partner,
officer, director, employee or agent thereof, entitled to indemnification
("indemnified party") under this Section 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 Section ("indemnifying party"), such
indemnified party will notify the indemnifying party in writing of the
commencement thereof as soon as practicable after the summons or other first
written notification giving information of the nature of the claim that has been
served upon the indemnified party; provided that the failure to so notify the
indemnifying party will not relieve the indemnifying party from any liability
under this Section, except to the extent that the omission results in a failure
of actual notice to the indemnifying party and such indemnifying party is
damaged solely as a result of the failure to give such notice. The indemnifying
party, upon the request of the indemnified party, shall retain counsel
satisfactory to the indemnified party to represent the indemnified party in the
proceeding, and shall pay the fees and disbursements of such counsel related to
such proceeding. In any such proceeding, any indemnified party shall have the
right to retain its own counsel, but the fees and expenses of such counsel shall
be at the expense of such indemnified party unless (i) the indemnifying party
and the indemnified party shall have mutually agreed to the retention of such
counsel or (ii) the named parties to any such proceeding (including any
impleaded parties) include both the indemnifying party and the indemnified party
and representation of both parties by the same counsel would be inappropriate
due to actual or potential differing interests between them. The indemnifying
party shall not be liable for any settlement of any proceeding effected without
its written consent but if settled with such consent or if there be a final
judgment for the plaintiff, the indemnifying party agrees to indemnify the
indemnified party from and against any loss or liability by reason of such
settlement or judgment.
8. Representations, Warranties and Undertakings.
(a) You represent and warrant to American Express and
undertake to do as follows:
(i) Your Broker/Dealer is a corporation, partnership or other
entity duly organized and validly existing in good standing under the
laws of the jurisdiction in which You are organized, and is qualified
to act as a broker/dealer in the states or other jurisdictions in
which it transacts business. Your Broker/Dealer is a member in good
standing of the NASD. Your Broker/Dealer will maintain all
registrations, qualifications and memberships required by the terms of
this Agreement in full force and effect throughout the term of this
Agreement.
(ii) Your Agency is a corporation, partnership or other entity,
duly organized and validly existing in good standing under the laws of
the jurisdiction in which it is organized, and is licensed and
otherwise qualified to act as an insurance agent in the states or
other jurisdictions in which it transacts business. If Your Agency has
to establish another organization to obtain the appropriate insurance
agency license in a state, that agency will sign the attached Schedule
B and will agree to abide by the terms thereon. Each such additional
agency will be referred to as an Affiliated Agency. Your Agency will
maintain all registrations, qualifications and licenses required by
the terms of this Agreement in full force and effect throughout the
term of this Agreement. Your Agency is associated with Your
Broker/Dealer in accordance with the terms and conditions of the SEC
no-action letter First of America Brokerage Services, Inc. (avail.
Sept. 28, 1995).
(iii) The execution and delivery of this Agreement and the
performance of the transactions contemplated hereby have been duly
authorized by all necessary action, and all other authorizations and
approvals (if any) required for your lawful execution and delivery of
this Agreement, and its performance hereunder, have been obtained.
Upon execution and delivery by You and assuming due and valid
execution by Company and Distributor, this Agreement will constitute a
valid and binding agreement, enforceable against You in accordance
with its terms.
(b) Company and Distributor, as applicable, represent and
warrant to You and undertake to do as follows:
(i) Company represents and warrants that it is duly
incorporated in the state of Indiana and licensed in all states,
jurisdictions and territories identified in Schedule A.
(ii) Distributor represents and warrants that it is duly
registered as a broker/dealer with the SEC, the NASD, all states,
jurisdictions and territories identified in Schedule A, and is
qualified to do business in all states, jurisdictions and
territories identified in Schedule A in which Company is licensed
and qualified to do business.
(iii) Company represents and warrants that the Variable
Contracts have been filed with and approved by appropriate state
insurance departments, and that all sales literature has been
filed with and approved by the insurance departments where
required.
(iv) Company and Distributor represent and warrant that the
Variable Contracts and the separate accounts supporting such
contracts shall comply in all material respects with the
applicable requirements of the Securities Act of 1933 and the
Investment Company Act of 1940.
(v) Company represents and warrants that the prospectus(es)
and registration statement(s) relating to the Variable Contracts
contain no untrue statements of material fact or omission to
state a material fact, the omission of which makes any statement
contained in the prospectus(es) and registration statement(s)
misleading.
(vi) Company represents and warrants that Company will meet
any requirements of the state departments of insurance in the
jurisdictions in which the Variable Contracts are available for
sale regarding both the filing and approval of advertising and
sales literature.
9. Termination
(a) Termination for Cause. At any time during the term of this
Agreement, American Express may terminate this Agreement immediately for cause
upon written notice of such termination to You. Such written notice shall state
the cause with specificity. As used in this Section, the term "cause" shall mean
any one or more of the following:
(i) the conviction of any party, its officers or supervisory
personnel of any felony, of fraud, or of any crime involving
dishonesty;
(ii) the intentional misappropriation by a party of funds or
property of any other party, or of funds received for it or for
annuity contract-holders by such other party;
(iii) the cancellation, or the refusal to renew by the
issuing insurance regulatory authority, of any license,
certificate or other regulatory approval required in order for
any party to perform its duties under this Agreement;
(iv) any action by a regulatory authority with jurisdiction
over the activities of a party that would place the party in
receivership or conservatorship or otherwise substantially
interfere or prevent such party from continuing to engage in the
lines of business relevant to the subject matter hereof; or
(v) a party becoming a debtor in bankruptcy (whether
voluntary or involuntary) or the subject of an insolvency,
rehabilitation or delinquency proceeding.
(b) Termination without Cause. You or American Express may
terminate this Agreement without cause upon 30 days' prior written notice to the
other party.
(c) Post Termination Obligations. Upon termination of this
Agreement, American Express' obligation to pay compensation to You shall
continue for so long as the Variable Contracts are outstanding (including any
contracts issued by the Company upon exchange, conversion, annuitization or
replacement thereof or therefor) in accordance with Schedule A.
(d) Transfer of Representative. If your Representatives are
terminated or otherwise leave your employ, compensation paid hereunder will
continue to be paid to You on any Variable Contract sold and/or serviced by such
Representative, unless You and such client notify American Express, in writing
of a change in payment procedures that is in accordance with applicable law.
10. Independent Contractor. This Agreement is not a contract of
employment. Nothing contained in this Agreement shall be construed or deemed to
create the relationship of joint venture, partnership, or employer and employee
between Company, and Distributor and You. Each party is an independent
contractor and shall be free, subject to the terms and conditions of this
Agreement, to exercise judgment and discretion with regard to the conduct of its
business.
11. Confidentiality. Each party (e.g., American Express, on the one
hand, and Authorized Selling Firm, on the other hand) to this Agreement
acknowledges that they and their affiliates may, in the course of carrying out
its responsibilities under this Agreement, be exposed to or acquire information
which is proprietary or confidential information of the other party, or third
parties to whom the other party owes a duty of confidentiality. Proprietary and
confidential information shall include, but not be limited to, each party's
non-public materials related to the Variable Contracts, information as to the
business methods, operations or affairs or the processes and systems used in
operation of a party's business, and information related to prospects and
customers of the Authorized Selling Firm as indicated in Section 5, and
confidential information shall include, but not be limited to, the terms of this
Agreement, all whether now known or subsequently learned by the other party
("Protected Information").
The parties agree to (a) hold, and ensure their employees and agents,
and any affiliates, and any employees and agents of such affiliates, hold the
Protected Information in strict confidence, (b) not give, sell or disclose the
Protected Information to third parties, or to personnel of the parties or any
affiliate for any purposes whatsoever other than as required for the provision
of services as contemplated by this Agreement, and (c) advise each of its
employees who may be exposed to the Protected Information to keep such
information confidential.
The Protected Information shall not include information which is (1) in
or becomes part of the public domain, except when such information is in the
public domain due to disclosure by a party or its affiliate in violation of this
Agreement, (2) demonstrably known to a party or their affiliates prior to
execution of this Agreement, (3) independently developed by a party or their
affiliates in the ordinary course of business outside of this Agreement, or (4)
rightfully and lawfully obtained by a party or their affiliates from third
parties.
It is understood that in the event of a breach of this Section, damages
may not be an adequate remedy and a party shall be entitled to apply for
injunctive relief to restrain any breach, threatened or actual, pending the
outcome of arbitration provided for under Section 14.
12. Assignment. The parties of this Agreement may not assign, either
wholly or partially, this Agreement or any of the benefits accrued or to accrue
under it, or subcontract their interests or obligations under this Agreement,
without the written approval of all parties.
13. Amendment of Agreement. The parties may amend this Agreement,
including any of the Schedules, at any time, but no amendment shall be effective
until approved in writing by American Express and You subject to the provisions
of: Section 12, "Assignment."
14. Arbitration. Any controversy or claim arising out of or relating to
this Agreement, or the breach thereof, shall be settled by arbitration
administered by the American Arbitration Association in accordance with its
Commercial Arbitration Rules and Title 9 of the U.S. Code. Judgment on the award
rendered by the arbitrator(s) may be entered in any court having jurisdiction
thereof. The number of arbitrators shall be three, one of whom shall be
appointed by each of the parties and the third of whom shall be selected by
mutual agreement, if possible, within 30 days of the selection of the second
arbitrator and thereafter by the administering authority and the place of
arbitration shall be Minneapolis, Minnesota. The arbitrators will have no
authority to award punitive damages or any other damages not measured by the
prevailing party's actual damages, and may not, in any event, make any ruling,
finding or award that does not conform to the terms and conditions of this
Agreement. Either party may make an application to the arbitrator(s) seeking
injunctive relief to maintain the status quo until such time as the arbitration
award is rendered or the controversy is otherwise resolved. Either party may
apply to any court having jurisdiction hereof and seek injunctive relief in
order to maintain the status quo until such time as the arbitration award is
rendered or the controversy is otherwise resolved.
15. Miscellaneous
(a) Applicable Law. This Agreement shall be governed by and
interpreted under the laws of the State of Minnesota.
(b) Severability. Should any part of this Agreement be
declared invalid, the remainder of this Agreement shall remain in
full force and effect as if the Agreement had originally been
executed without the invalid provisions.
(c) Notice. Any notice hereunder shall be in writing and
shall be deemed to have been duly given if sent by certified or
registered mail, postage prepaid, or via a national courier
service with the capacity to track its shipments, to the
following addresses:
If to Company
American Enterprise Life Insurance Company
00 Xxxxx 0xx Xxxxxx
Xxxxxxxxxxx, XX 00000
Attn: Compliance Officer (Unit 1818)
If to Distributor
American Express Service Corporation
00 Xxxxx 0xx Xxxxxx
Xxxxxxxxxxx, XX 00000
Attn: Compliance Officer (Unit 1818)
If to Your Broker/Dealer
Broker/Dealer
Address
Attn: Broker Contact Name
If to Your Agency
Your Agency
Address
Attn: Your Agency Contact Name
If to Xxxxxxx Xxxxx
Xxx Xxx Xxxx Xxxxx
Xxx Xxxx, XX 00000
Attn: Xxxxxxx X. Grip
(d) Binding Effect. This Agreement shall be binding upon and inure to
the benefit of the parties hereto and their respective successors and assigns,
subject to the provisions of this Agreement limiting assignment.
(e) Headings. The headings in this Agreement are for convenience only
and are not intended to have any legal effect.
(f) Defined Terms. The terms defined in this Agreement are to be
interpreted in accordance with this Agreement. Such defined terms are not
intended to conform to specific statutory definitions of any state.
(g) Entire Agreement. The parties acknowledge, understand and agree
that Xxxxxxx, Xxxxx & Co. acts as the exclusive wholesaler of the Variable
Contract pursuant to that certain Wholesaling Agreement dated ___________, 1999,
between Company, Distributor and Xxxxxxx, Sachs & Co. The parties further
acknowledge, understand and agree that nothing described herein shall limit any
of the duties, responsibilities or authority of Xxxxxxx, Xxxxx & Co. under that
Wholesaling Agreement. This Agreement constitutes the entire agreement of the
parties with respect to the subject matter hereof and supersedes all previous
communications, representations, understandings and agreements either oral or
written, between the parties or any official representatives thereof. As of the
Effective Date, any and all prior consents by the Company to any entity or
individual acting as an Authorized Selling Firm are withdrawn.
(h) Survival. All terms and conditions of the following sections will
survive termination of this Agreement:
Section 5, "Ownership of Customer Information and Prospects";
Section 7, "Indemnification"; Section 9(c), "Post Termination
Obligations"; Section 11, "Confidentiality."
(i) No Waiver. No failure to enforce, nor any breach of any term or
condition of this Agreement shall operate as a waiver of such term of condition,
or of any other term of condition, nor constitute nor be deemed a waiver or
release of any other rights at law or in equity, or of claims which any party
may have against any other party for anything arising out of, connected with, or
based upon this Agreement. Any waiver, including a waiver of this Section, must
be in writing and signed by the parties hereto.
Please confirm your agreement by signing and returning to us
the two enclosed duplicate copies of the Agreement, including the Schedules.
Upon our acceptance hereof as evidenced by execution of the Agreement by Company
and Distributor, the Agreement shall constitute a valid and binding contact
between us. After our acceptance, we will deliver to You one fully executed copy
of this agreement.
Very truly yours,
American Enterprise Life Insurance Company
By:___________________________
Title:___________________________
Date:___________________________
American Express Service Corporation
By:_____________________________
Title:___________________________
Date:___________________________
Confirmed ___________, 1999
[name of broker/dealer]
Address
By:_____________________________
Title:___________________________
Date:___________________________
[name of insurance agency]
Address
By:_____________________________
Title:___________________________
Date:___________________________
