See All of This Company's Exhibits
EX-99.3(B)
3
a2039901zex-99_3b.txt
EXHIBIT 99.3(B)
AMERICAN FAMILY SECURITIES, LLC
REGISTERED REPRESENTATIVE AGREEMENT
THIS AGREEMENT, made this ____ day of __________________, 20___ (the "Effective
Date"), is by and between American Family Securities, LLC, a Wisconsin limited
liability company, ("the Company"), having its principal office at 6000 American
Parkway, Madison, Wisconsin, 53783 and ____________________________________,
(the "Representative").
RECITALS
WHEREAS, the Company is engaged in the securities business as a broker/dealer
registered with the Securities and Exchange Commission (the "SEC") and is a
member of the National Association of Securities Dealers, Inc. (the "NASD"); and
WHEREAS, the Company is an affiliate of American Family Life Insurance Company
("AFLIC");
WHEREAS, agents of AFLIC may be qualified for association with the Company as
registered persons;
WHEREAS, Representative is an agent of AFLIC; and
WHEREAS, the Company desires to appoint Representative as a registered person of
the Company, and Representative desires to serve as a registered person of the
Company, for the purpose of engaging in the securities business on behalf of the
Company;
NOW, THEREFORE, in consideration of the covenants and promises herein, and other
good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereby agree as follows:
1. AUTHORIZATION AND APPOINTMENT
The Company hereby authorizes Representative to solicit, promote, and conduct a
securities business as a registered representative of the Company.
Representative shall not be registered or licensed with any other securities
broker/dealer during the term of this Agreement except with the Company's prior
written consent. It is acknowledged that Representative is also appointed by
AFLIC and American Family Mutual Insurance Company ("AFMIC") to solicit
applications for non-variable insurance products issued by AFLIC and AFMIC.
2. RELATIONSHIP
Representative's relationship with Company is that of an independent contractor.
Nothing contained herein or elsewhere shall be construed as creating an
employer/employee relationship.
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Except as otherwise provided herein, Representative shall be responsible for
all expenses and fees associated with his or her securities business.
3. COMPLIANCE WITH APPLICABLE LAW AND COMPANY POLICY
3.1 Representative acknowledges and agrees that the securities business is
subject to extensive regulation, including, without limitation, laws
administered and interpreted by the SEC, and the regulations promulgated
thereunder, the rules and regulations of the NASD and other laws and regulations
of the United States and of the various states (such laws, rules and regulations
being collectively referred to as "Applicable Law"). Representative shall be
familiar with and shall strictly comply with such Applicable Law, as well as
with the Company's then-current Registered Representative Manual as it may be
amended from time to time, and with any other such instructions and directions
as may be issued by the Company from time to time (collectively, "Company
Policy"). Representative understands that failure to comply with Applicable Law
or with Company Policy may result in proceedings by governmental authorities,
the SEC, the NASD, and private parties, that could have a significant adverse
effect on Representative and the Company.
3.2 Representative understands and agrees that the Company has the right and
obligation to establish and institute, implement and maintain a supervisory
system and procedures reasonably designed to achieve compliance with Applicable
Law, which includes the obligation to supervise Representative's activities in
the securities business and Representative's compliance with Applicable Law and
Company Policy. Representative understands and agrees that in the exercise of
this supervisory responsibility the Company may, among other things: (i) reject
any securities transaction submitted by Representative; (ii) take action,
implement procedures, impose a fine or suspension, terminate this Agreement, or
employ any other measure it in its sole discretion determines to be reasonably
designed to achieve compliance with or to enforce its supervisory system; (iii)
conduct such audits of Representative and Representative's financial, business,
and personal records (including, but not limited to Representative's federal and
state income tax returns) as may be required by Applicable Law or as otherwise
determined by the Company; and (iv) require Representative to attend such
compliance-related or other training as the Company may determine.
3.3 Representative shall keep correct accounts and records of all business
transacted. Representative's accounts and records shall be open at all times to
inspection and examination by the Company.
4. MAINTENANCE OF REGISTRATIONS AND LICENSES
Representative shall be responsible for maintaining continuously such permits
and licenses as may be required, and shall make such applications and effect
such registrations as may from time to time be required for Representative's
sales of securities and other activities in connection with the Company's
business. Representative shall not engage in activities on behalf of the Company
during any period during which Representative is not in compliance with
applicable registration, licensing, examination, continuing education or other
compliance requirements. Final determination of such compliance shall be made by
the Company.
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5. STATE REGISTRATIONS
Representative shall not offer or sell any securities product unless the Company
has approved such product and Representative is duly licensed to sell such
product in the particular jurisdiction.
6. USE OF PROSPECTUS AND SALES LITERATURE; COMMUNICATIONS WITH CUSTOMERS
6.1 The Company shall furnish Representative with all sales literature to be
used in connection with the offer and sale of securities. Representative must
not use any other sales literature relating directly or indirectly to the
Company or securities of any kind without the Company's prior written approval.
Representative shall not modify, alter or highlight the information contained in
any sales literature or prospectus for prospective purchasers.
6.2 Representative shall not make any representation concerning any security
that is inconsistent with those contained in the appropriate current offering
document in the case of a newly issued security or disclosure filings made by
the issuer of the security in the case of traded securities. Representative
shall not solicit or sell any newly issued security unless the appropriate
current prospectus or other offering document is furnished to the purchaser
prior to the offer and sale.
6.3 Representative shall comply with Applicable Law and Company Policy regarding
conduct and sales practices, including, without limitation, all requirements
that communications with the public not contain an untrue statement of a
material fact or otherwise be false and misleading.
7. COMPANY REVIEW OF ORDERS
7.1 Applications, orders and other subscriptions for the purchase or sale of
securities solicited or taken by Representative shall be submitted by
Representative and approved by the Company and/or the issuers thereof only on
the terms that are set forth in (i) the then currently applicable prospectus
(and/or statement of additional information, if any) or other offering document,
if any, and (ii) Company Policy. Representative must promptly forward all
applications, purchase payments and premiums for securities to the designated
location when Representative receives them.
7.2 The Company reserves the right at any time to refuse to accept and approve
any order or application for the purchase of securities obtained by
Representative and to refund, without Representative's consent, all monies
received in connection therewith.
8. CUSTOMER FUNDS
All monies or other settlements received by Representative for or on behalf of
the Company or a third party shall be received by Representative in a fiduciary
capacity in trust for, and shall be immediately transmitted to, the Company or
as otherwise directed by the Company. In no event shall Representative commingle
such monies with other funds.
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9. COMMISSIONS
9.1 Subject to the provisions of this Agreement, the Company shall pay
Representative commissions on all completed securities transactions. Such
commissions shall be paid in accordance with the Company's commission schedule
and procedures as they shall be amended from time to time. The records and
determination of the Company shall be conclusive in the calculation of the
commissions payable to Representative.
9.2 Commissions shall not be due or payable to Representative for the sale of
securities until the Company has received the related broker/dealer concession
or commission. Representative waives any right to receive commissions prior to
such receipt, and agrees that the Company's liability for the commission payable
is limited solely to the proceeds of the concession or commission received by
the Company. In the event a concession or commission is charged back to the
Company, the Company shall have the right to offset any commission payable to
Representative in accordance with the terms of Section 17.1 of this Agreement.
[COMMISSIONS SHALL BE PAID TO REPRESENTATIVE ONLY SO LONG AS THIS AGREEMENT IS
IN FORCE] and may be withheld or forfeited in the Company's sole discretion if
Representative fails to comply with applicable registration, licensing and
examination obligations. The Company has the right at any time to change or
cancel the kinds of commissions set forth in this Agreement.
9.3 Upon termination of this Agreement due to Representative's disability, death
or retirement, the Company agrees to pay Representative (or, in the event of
Representative's death, Representative's named beneficiary) all first year and
trailer commissions due and owing under the terms of this Agreement, on any
securities business written prior to the date of termination.
Beneficiary designation (name): ___________________________
Relationship: ______________________
9.4 This beneficiary designation may be changed from time to time by
Representative upon notice in writing to the Company.
10. RESPONSIBILITY FOR SECURITIES BUSINESS; OUTSIDE BUSINESS ACTIVITIES
10.1 Representative shall be responsible for developing Representative's
securities business. Representative shall not be required to spend any
particular amount of time acting as a registered representative of the Company.
Except as Representative and the Company may otherwise agree, in no event shall
Representative be required to sell any specified quota of securities offered,
issued, or sponsored by AFLIC, the Company, or their affiliates. Notwithstanding
the foregoing, nothing herein shall prevent the Company from establishing
production or sales criteria for Representative as the Company may from time to
time determine.
10.2 Representative shall be free to engage in other businesses or occupations
provided that Representative first notifies the Company and obtains advance
approval in writing. Representative shall also comply with all Applicable Law
and with Company Policy with respect to such other business or occupation,
including, without limitation, disclosing to the Company such information about
such business or occupation as the Company shall reasonably request.
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11. RELATIONSHIP WITH NON-REGISTERED PERSONS
11.1 Representative shall communicate Company Policy to any non-registered
personnel that assists Representative with Representative's securities business,
shall supervise such personnel with a view to compliance with such rules and
regulations, and shall obtain their written agreement (in the form attached to
this Agreement as EXHIBIT A) to abide by these rules and regulations when and as
required by the Company.
11.2 Representative shall be solely responsible for salaries and other
compensation of all Representative's employees or independent contractors and
shall comply with any and all applicable federal, state, or local laws, rules,
regulations and ordinances in dealing with such individuals.
12. INSURANCE COVERAGE
Representative agrees to obtain and carry such face amount of insurance coverage
as the Company may from time to time require. If so instructed, agent shall name
the Company as an additional insured under such coverage. Representative agrees
to provide the Company with evidence of such coverage as the Company may request
from time to time.
13. CONFIDENTIAL INFORMATION AND RETURN OF MATERIALS
Unless expressly authorized in writing by the Company, Representative agrees not
to communicate or divulge, or use for the benefit of Representative or any other
person or entity, any confidential information of the Company of any type or
description, including, but not limited to any proprietary information,
policies, forms, manuals, or reports of the Company, or information about the
Company's finances, operations, or legal proceedings. Upon termination of this
Agreement, Representative shall (i) promptly return to the Company any manuals,
forms prospectuses, or other materials or supplies previously furnished to
Representative by the Company, and (ii) provide the Company with such records in
Representative's control (or copies thereof) that the Company may require to
comply with Applicable Law.
14. LEGAL PROCEEDINGS AND INDEMNIFICATION
Representative agrees to notify the Company immediately of the commencement of
any and all inquiries from regulators, disciplinary actions, civil and criminal
allegations and complaints, suits or arbitration proceedings brought against or
involving Representative that are in any way related to Representative's
securities business or Representative's association with the Company.
Representative understands and agrees that Representative has no right or
authority to commence any legal proceedings, or to incur any expenses or
obligations, on the Company's behalf or in its name. The Company reserves the
right to settle any such proceeding in its sole discretion, and Representative
agrees to cooperate fully with the Company in effecting any such settlement.
Representative agrees to indemnify and make the Company harmless from any and
all expenses, liabilities, costs, causes of action, settlements, attorneys'
fees, damages or other judgments resulting from Representative's acts, omissions
or transactions that are related to Representative's
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securities business, or Representative's violation of the terms of this
Agreement or of Applicable Law.
15. ASSIGNMENT
Neither this Agreement, nor any right to receive compensation hereunder, nor any
other right or interest herein, may be assigned by Representative without the
Company's express written consent.
16. TERM, TERMINATION AND AMENDMENT
16.1 This Agreement shall remain in effect until terminated as set forth below.
16.2 Either Representative or the Company may terminate this Agreement with or
without cause upon giving 30 days' written notice to the other party. In
addition, the Company may immediately terminate this Agreement upon written
notice to Representative in the event of Representative's violation of
Applicable Law, Company Policy or the terms of this Agreement.
16.3 Notwithstanding the foregoing, this Agreement shall automatically terminate
without notice in the event of (i) the suspension, revocation, cancellation or
other impairment of Representative's registration, license or authority to
solicit, offer or sell securities at any time by the NASD or by any federal,
state, district or other authority, (ii) the termination of Representative's
association with the Company, (iii) the termination of Representative's contract
with AFLIC, or (iii) Representative's death or incapacity.
16.4 In the event of termination of this Agreement by reason of the death or
incapacity of Representative, any payments due Representative pursuant to
Section 9 hereof shall be made to Representative's beneficiary as designated in
accordance with the provisions of Sections 9.3 and 9.4 of this Agreement.
16.5 No amendment to this Agreement shall be effective unless it is in writing
and signed by both parties.
17. RETURN OF COMPENSATION; CLAIMS ON EARNINGS
17.1 In the event any order for the purchase of securities is rejected by the
Company or any payment received for the purchase of securities cannot be
collected or otherwise proves insufficient or worthless, any compensation paid
to Representative by the Company hereunder shall, promptly upon notice to
Representative, be returned by Representative to the Company either in cash or
as a charge against Representative's account with the Company, as the Company
may elect. Representative hereby agrees that until the Company receives full
reimbursement in cash, the amount of compensation due and owing the Company
shall constitute a debt of Representative to the Company, which the Company may
collect by any lawful means, with interest thereon at the maximum rate permitted
by law.
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17.2 The Company shall have first claim on all of Representative's earnings
hereunder. This means the Company, as and when it elects, may keep all or any
part of Representative's earnings hereunder to reduce any debt Representative
owes to the Company; and, for that purpose and to the extent permitted by law,
Representative hereby assigns all such earnings to the Company. While the
Company may release Representative's earnings while Representative owes a debt
to the Company, this does not mean the Company has waived this right of first
claim to Representative's earnings. The Company may make this claim whether
Representative's earnings are due the Company, the Representative, the
representative of Representative's estate, or Representative's heirs. The
Company's claim also takes precedence over claims of Representative's creditors.
All Representative's earnings kept by the Company shall be used to reduce the
debt owed to the Company.
18. ARBITRATION
Representative acknowledges and agrees that all disputes arising under this
Agreement are to be settled and determined by arbitration. Such arbitration
shall be conducted in accordance with the rules of the NASD.
19. PRIOR CONTRACTS
This Agreement supercedes all other contracts or agreements, whether oral or
written, between Representative and the Company.
20. NOTICE
Any notice to be given to a party hereto pursuant to this Agreement shall be in
writing, addressed to such party at the last known address of such party. Any
notice delivered by the mails, postage fully prepaid, shall be deemed to have
been given five (5) days after mailing or, if earlier, upon receipt.
21. WAIVER
The Company may choose, form time to time, not to enforce a provision of this
Agreement or an aspect of Company Policy. This does not mean the Company has
waived the right to enforce it in the future. Also, it does not mean that the
Company ratifies or consents to those actions of Representative that were not in
accord with this Agreement or with Company Policy.
22. INVALID PROVISIONS; SURVIVAL
The invalidity or unenforceability of any particular provision of this Agreement
shall not affect the other provisions hereof, and this Agreement shall be
construed in all respects as if such invalid or unenforceable provision were
omitted. Any paragraph setting forth the rights and remedies of the Company or
its affiliates against Representative for any breach hereunder, or for any debt,
shall survive the termination of this Agreement.
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23. GOVERNING LAW
This Agreement shall be construed in accordance with the laws of the State of
Wisconsin.
APPROVAL AND ACCEPTANCE OF APPOINTMENT AND THE TERMS OF THIS AGREEMENT BY
REPRESENTATIVE.
__________________________________
REPRESENTATIVE
__________________________________
DATE
APPROVAL AND ACCEPTANCE OF REPRESENTATIVE'S APPOINTMENT AND THE TERMS OF THIS
AGREEMENT BY THE COMPANY.
AMERICAN FAMILY SECURITIES, LLC
BY:
__________________________________
AUTHORIZED OFFICER
__________________________________
DATE
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EXHIBIT A
ACKNOWLEDGMENT FORM FOR UNLICENSED EMPLOYEES
In connection with my employment by [INSERT AGENT'S NAME], an American
Family Securities ("AFS") registered representative (the "Registered
Representative"), I hereby acknowledge that I have received, read, and
understand [A COPY OF AFS'S RULES AND REGULATIONS (THE "RULES") CONCERNING
ETHICAL MARKET CONDUCT] and agree to comply with the Rules as they may be
amended from time to time. I understand that since I am not licensed or
qualified to sell variable insurance products ("Variable Products"), I must be
very careful not to perform any activities or provide any information to
customers that could confuse a customer as to my role in the sale of Variable
Products. I am aware that under federal and state securities laws, and under
state insurance laws, only properly licensed, registered, and qualified persons
may solicit customers or recommend or discuss Variable Products with a customer.
In sum, this means that as an Unlicensed Employee, I may provide only
"clerical" and "ministerial" services in support of the registered
representative for whom I work. I understand that permissible activities for
Unlicensed Employees are limited to:
- referring prospective customers to a Registered Representative;
- arranging an appointment with or taking a message for a
Registered Representative if a Registered Representative is
absent or unavailable;
- referring telephone calls and other written and oral
communications to a Registered Representative; and
- referring all Variable Products-related questions to a
Registered Representative.
When engaging in any of the foregoing permissible activities, I shall
limit my discussion of the Variable Products to statements advising customers of
the availability of information about the Variable Products, and the referral of
such customers to the Registered Representative. I shall not offer securities or
insurance advice, make recommendations, discuss the features, merits, or
suitability of any Variable Products, or handle any question that might require
familiarity with the securities industry. I shall not hold or maintain customer
funds in connection with securities transactions, or have any involvement in
insurance transactions other than providing clerical or ministerial advice.
I also understand that nothing in this Acknowledgment Form limits my
ability to provide administrative or clerical services. If there is any doubt as
to whether any activity is administrative or clerical, I shall consult with my
Registered Representative before undertaking any such activity.
______________________________ ____________________________
[Registered Representative] [Unlicensed Employee]
______________________________ ____________________________
Date Date
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