<Page>
EXHIBIT 10.39
GLENBROOK LIFE AND ANNUITY COMPANY
ADDENDUM TO SELLING AGREEMENT
This Addendum shall modify your Selling Agreement ("Agreement") with Glenbrook
Life and Annuity Company ("Glenbrook Life") and ALFS, Inc. ("ALFS") as set forth
below and in the attached Schedule A.
The attached Schedule A shall replace any previous Schedule A for the same
product or; shall be an addition to the current Schedule A if the product was
not part of your Selling Agreement prior to the effective date of this
Amendment.
The acceptance of an application for this product, on or after the effective
date of this Addendum, is subject to the rules of Glenbrook Life and ALFS and
the provisions of your Selling Agreement. By submission of a Glenbrook Life
application, acceptance of commissions, request for change of Agent of record
and/or transfer of servicing to another BD in accordance with the Addendum, you
agree to be bound by the provisions of this Addendum.
Effective date: November 18, 2002
BY /s/ Andrea Schur /s/ Lisa A. Burnell
Andrea Schur Lisa A. Burnell
Vice President Assistant Vice President
Glenbrook Life and Annuity Company and Compliance Officer
ALFS, Inc.
<Page>
SCHEDULE OF COMMISSIONS
SCHEDULE A
Subject to terms and conditions of the Selling Agreement, Associated Insurance
Agency shall be compensated for VA Contracts issued according to the following
chart (based upon the option selected in writing by each Agent or
Representative):
AIM LIFETIME AMERICA CLASSIC (SM) VARIABLE ANNUITY "STANDARD" OPTION
<Table>
<Caption>
ISSUE AGE COMMISSION OPTIONS
- ------------------------------------------------------------------------------------------------------------------------------
A B C
- ------------------------------------------------------------------------------------------------------------------------------
6.25%* 5.00% 4.50%*
0-80 no trail .25% trail in contract years 2+** 1% trail in contract years 8+***(1)
5.00%* 4.00% 3.50%*
81-85 no trail .25% trail in contract years 2+** 1% trail in contract years 8+***(1)
3.125%* 2.50% 2.55%*
86-90 No trail .25% trail in contract years 2+** 1% trail in contract years 8+***(1)
</Table>
* = Based upon purchase payment.
** = Trail commissions are based on the Contract Value on the last day of
each contract quarter beginning with the last day of the 15th contract
month. Trail commissions will be paid each calendar quarter beginning
with the first calendar quarter following the 15th contract month and
ending when the contract is annuitized; the contract must be in effect
through the end of the contract quarter for a trail commission to be
paid.
*** = Trail commissions are based on the Contract Value on the last day
of each contract quarter beginning with the last day of the 87th
contract month. Trail commissions will be paid each calendar quarter
beginning with the first calendar quarter following the 87th contract
month and ending when the contract is annuitized; the contract must be
in effect through the end of the contract quarter for a trail
commission to be paid.
(1) Trail applies to Account Value less premium still within surrender charge
period.
COMMISSION CHARGE BACKS
<Table>
<Caption>
TRANSACTION PERIOD OF CHARGEBACK CHARGEBACK PLEASE NOTE
- ------------------------------------------------------------------------------------------------------------------------------
Surrender During the "free look" period 100% of commission N/A
</Table>
COMMISSION DURING ANNUITIZATION
<Table>
<Caption>
A B C
- ------------------------------------------------------------------------------------------------------------------------------
0% if annuitize in contract years
0-7 .50% if annuitize in contract
0% if annuitized in years 8+ (if surrender charge
Variable contract years 1- 7 .25% if annuitize in contract year 1-7 remains at annuitizations)
Annuitization(2) .50% if annuitize in contract years 8+
.50'% if annuitized in 1% if annuitize in contract years 8+
contract years 8+ (if no surrender charge remains at
annuitizations)
0% if annuitize in
contract years 1-7 0% if annuitize in contract years 0% if annuitize in contract years 0-7
Fixed 1-7
Annuitization(2) .25% if annuitized in .25% if annuitize in contract years
contract years 8+ .25% if annuitize in contract years 8+ 8+
</Table>
(2) No commission will be paid on payment coming from Guaranteed Minimum Income
Benefit.
<Page>
AIM LIFETIME AMERICA REGAL (SM) VARIABLE ANNUITY "SHORT SURRENDER" OPTION
<Table>
<Caption>
ISSUE AGE COMMISSION OPTIONS
- ------------------------------------------------------------------------------------------------------------------------------
A B C
- ------------------------------------------------------------------------------------------------------------------------------
3.75%
0-80 1% trail in contract years N/A N/A
4+**(1)
3.00%
81-85 1% trail in contract years N/A N/A
4+**(1)
1.875%
86-90 1% trail in contract years N/A N/A
4+**(1)
</Table>
* = Based upon purchase payment.
** = Trail commissions are based on the Contract Value on the last day of
each contract quarter beginning with the last day of the 39th contract
month. Trail commissions will be paid each calendar quarter beginning
with the first calendar quarter following the 39th contract month and
ending when the contract is annuitized; the contract must be in effect
through the end of the contract quarter for a trail commission to be
paid.
(1) Trail applies to Account Value less premium still within surrender charge
period.
COMMISSION CHARGE BACKS
<Table>
<Caption>
TRANSACTION PERIOD OF CHARGEBACK CHARGEBACK PLEASE NOTE
- ------------------------------------------------------------------------------------------------------------------------------
Surrender During the "free look" 100% of commission N/A
period
</Table>
COMMISSION DURING ANNUITIZATION
<Table>
<Caption>
A B C
- ------------------------------------------------------------------------------------------------------------------------------
Variable 0% if annuitized in contract N/A N/A
Annuitization(2) years 1- 3
1'% if annuitized in contract
years 4+
Fixed 0% if annuitize in contract years N/A N/A
Annuitization(2) 1-3
.25% if annuitized in contract
years 4+
</Table>
(2) No commission will be paid on payment coming from Guaranteed Minimum Income
Benefit.
<Page>
AIM LIFETIME AMERICA FREEDOM (SM) VARIABLE ANNUITY "NO SURRENDER" OPTION
<Table>
<Caption>
ISSUE AGE COMMISSION OPTIONS
- ------------------------------------------------------------------------------------------------------------------------------
A B C
- ------------------------------------------------------------------------------------------------------------------------------
1.5%
0-80 1% trail in contract years 2+** N/A N/A
1.25%
81-85 1% trail in contract years 2+** N/A N/A
1.00%
86-90 1% trail in contract years 2+** N/A N/A
</Table>
* = Based upon purchase payment.
** = Trail commissions are based on the Contract Value on the last day of
each contract quarter beginning with the last day of the 15th contract
month. Trail commissions will be paid each calendar quarter beginning
with the first calendar quarter following the 15th contract month and
ending when the contract is annuitized; the contract must be in effect
through the end of the contract quarter for a trail commission to be
paid.
COMMISSION CHARGE BACKS
<Table>
<Caption>
TRANSACTION PERIOD OF CHARGEBACK CHARGEBACK PLEASE NOTE
- ------------------------------------------------------------------------------------------------------------------------------
Full or Partial During the "free look"
Withdrawal period 100% of commission N/A
Full or Partial During the "free look"
Withdrawal period 100% of commission N/A
</Table>
COMMISSION DURING ANNUITIZATION
<Table>
<Caption>
A B C
- ------------------------------------------------------------------------------------------------------------------------------
Variable 1% in contract years 2+ (regardless
Annuitization(2) of when contract is annuitized) N/A N/A
.25% in contract years 2+
Fixed (regardless of when contract is N/A N/A
Annuitization(2) annuitized)
</Table>
(1) No commission will be paid on payment coming from Guaranteed Minimum Income
Benefit.
<Page>
GLENBROOK LIFE AND ANNUITY COMPANY
ADDENDUM TO SELLING AGREEMENT
This Addendum shall modify your Selling Agreement ("Agreement") with Glenbrook
Life and Annuity Company ("Glenbrook Life") and ALFS, Inc. ("ALFS") as set forth
below and in the attached Schedule A.
The attached Schedule A shall replace any previous Schedule A for the same
product or; shall be an addition to the current Schedule A if the product was
not part of your Selling Agreement prior to the effective date of this
Amendment.
The acceptance of an application for this product, on or after the effective
date of this Addendum, is subject to the rules of Glenbrook Life and ALFS and
the provisions of your Selling Agreement. By submission of a Glenbrook Life
application, acceptance of commissions, request for change of Agent of record
and/or transfer of servicing to another BD in accordance with the Addendum, you
agree to be bound by the provisions of this Addendum.
Effective date: December 31, 2001
By:
Andrea Schur Lisa A. Burnell
Vice President Assistant Vice President
Glenbrook Life and Annuity Company and Compliance Officer
ALFS, Inc.
<Page>
The following revisions are made to the Commission Schedules that are a part of
the Selling Agreement. The payment of commissions for this product is subject to
the rules of Glenbrook Life and ALFS and the provision of your Selling
Agreement.
SCHEDULE OF COMMISSIONS
SCHEDULE A
Subject to terms and conditions of the Selling Agreement, Associated Insurance
Agency shall be compensated for VA Contracts issued According to the following
chart (based upon the option selected in writing by each Agent or
Representative):
AIM LIFETIME AMERICA CLASSIC (SM) VARIABLE ANNUITY "STANDARD" OPTION
<Table>
<Caption>
ISSUE AGE COMMISSION OPTIONS
- ------------------------------------------------------------------------------------------------------------------------------
A B C
- ------------------------------------------------------------------------------------------------------------------------------
6.25%* 5.00% 4.50%*
0-80 no trail .25% trail in contract years 2+** 1% trail in contract years 8+***(1)
5.00%* 4.00% 3.50%*
81-85 no trail .25% trail in contract years 2+** 1% trail in contract years 8+***(1)
3.125%* 2.50% 2.55%*
86-90 No trail .25% trail in contract years 2+** 1% trail in contract years 8+***(1)
</Table>
* = Based upon purchase payment.
** = Trail commissions are based on the Contract Value on the last day of
each contract quarter beginning with the last day of the 15th contract
month. Trail commissions will be paid each calendar quarter beginning
with the first calendar quarter following the 15th contract month and
ending when the contract is annuitized; the contract must be in effect
through the end of the contract quarter for a trail commission to be
paid.
*** = Trail commissions are based on the Contract Value on the last day
of each contract quarter beginning with the last day of the 87th
contract month. Trail commissions will be paid each calendar quarter
beginning with the first calendar quarter following the 87th contract
month and ending when the contract is annuitized; the contract must be
in effect through the end of the contract quarter for a trail
commission to be paid.
(1) Trail applies to Account Value less premium still within surrender charge
period.
(2) No commission will be paid on payment coming from Guaranteed Minimum
Income Benefit.
COMMISSION CHARGE BACKS
<Table>
<Caption>
TRANSACTION PERIOD OF CHARGEBACK CHARGEBACK PLEASE NOTE
- ------------------------------------------------------------------------------------------------------------------------------
Surrender During the "free look" period 100% of commission N/A
</Table>
COMMISSION DURING ANNUITIZATION
<Table>
<Caption>
A B C
- ------------------------------------------------------------------------------------------------------------------------------
0% if annuitize in contract years
0-7 .50% if annuitize in contract
0% if annuitized in .25% if annuitize in contract year years 8+ (if surrender charge
Variable contract years 1- 7 1-7 remains at annuitizations)
Annuitization(2) .50% if annuitize in contract years
.50'% if annuitized in 8+ 1% if annuitize in contract years 8+
contract years 8+ (if no surrender charge remains at
annuitizations)
0% if annuitize in 0% if annuitize in contract years
contract years 1-7 1-7 0% if annuitize in contract years 0-7
Fixed
Annuitization(2) .25% if annuitized in .25% if annuitize in contract years .25% if annuitize in contract years
contract years 8+ 8+ 8+
</Table>
<Page>
AIM LIFETIME AMERICA REGAL (SM) VARIABLE ANNUITY "SHORT SURRENDER" OPTION
<Table>
<Caption>
ISSUE AGE COMMISSION OPTIONS
- ------------------------------------------------------------------------------------------------------------------------------
A B C
- ------------------------------------------------------------------------------------------------------------------------------
3.75%
0-80 1% trail in contract years N/A N/A
4+**(1)
3.00%
81-85 1% trail in contract years N/A N/A
4+**(1)
1.875%
86-90 1% trail in contract years N/A N/A
4+**(1)
</Table>
* = Based upon purchase payment.
** = Trail commissions are based on the Contract Value on the last day of
each contract quarter beginning with the last day of the 39th contract
month. Trail commissions will be paid each calendar quarter beginning
with the first calendar quarter following the 39th contract month and
ending when the contract is annuitized; the contract must be in effect
through the end of the contract quarter for a trail commission to be
paid.
(1) Trail applies to Account Value less premium still within surrender charge
period.
(2) No commission will be paid on payment coming from Guaranteed Minimum
Income Benefit.
COMMISSION CHARGE BACKS
<Table>
<Caption>
TRANSACTION PERIOD OF CHARGEBACK CHARGEBACK PLEASE NOTE
- ------------------------------------------------------------------------------------------------------------------------------
Surrender During the "free look" period 100% of commission N/A
</Table>
COMMISSION DURING ANNUITIZATION
<Table>
<Caption>
A B C
- ------------------------------------------------------------------------------------------------------------------------------
0% if annuitized in contract
years 1- 3
Variable N/A N/A
Annuitization(2) 1'% if annuitized in contract
years 4+
0% if annuitize in contract years
1-3
Fixed N/A N/A
Annuitization(2) .25% if annuitized in contract
years 4+
</Table>
<Page>
AIM LIFETIME AMERICA FREEDOM (SM) VARIABLE ANNUITY "NO SURRENDER" OPTION
<Table>
<Caption>
ISSUE AGE COMMISSION OPTIONS
- ------------------------------------------------------------------------------------------------------------------------------
A B C
- ------------------------------------------------------------------------------------------------------------------------------
1.5%
0-80 1% trail in contract years 2+** N/A N/A
1.25%
81-85 1% trail in contract years 2+** N/A N/A
1.00%
86-90 1% trail in contract years 2+** N/A N/A
</Table>
* = Based upon purchase payment.
** = Trail commissions are based on the Contract Value on the last day of
each contract quarter beginning with the last day of the 15th contract
month. Trail commissions will be paid each calendar quarter beginning
with the first calendar quarter following the 15th contract month and
ending when the contract is annuitized; the contract must be in effect
through the end of the contract quarter for a trail commission to be
paid.
(1) For Standard option C and Short Surrender option A, trail applies to account
Value less Premium still within Surrender Charge period.
(2) No commission will be paid on payment coming from Guaranteed Minimum Income
Benefit.
COMMISSION CHARGE BACKS
<Table>
<Caption>
TRANSACTION PERIOD OF CHARGEBACK CHARGEBACK PLEASE NOTE
- ------------------------------------------------------------------------------------------------------------------------------
Full or Partial During the "free look"
Withdrawal period 100% of commission N/A
Full or Partial During the "free look"
Withdrawal period 100% of commission N/A
</Table>
COMMISSION DURING ANNUITIZATION
<Table>
<Caption>
A B C
- ------------------------------------------------------------------------------------------------------------------------------
Variable 1% in contract years 2+ (regardless
Annuitization(2) of when contract is annuitized) N/A N/A
.25% in contract years 2+
Fixed (regardless of when contract is N/A N/A
Annuitization(2) annuitized)
</Table>
<Page>
SELLING AGREEMENT
GLENBROOK LIFE AND ANNUITY COMPANY
Agreement, made this day of by and among
Glenbrook Life and Annuity Company ("Glenbrook"), an Arizona life insurance
company; ALFS, Inc. ("ALFS"), a Delaware corporation:
("Broker-Dealer" or BD"), a Corporation; and
("Associated Insurance Agency"), a
Corporation.
GLENBROOK LIFE AND ANNUITY COMPANY ALFS, INC.
BY: BY:
----------------------------------- ---------------------------------
TITLE: TITLE:
-------------------------------- ------------------------------
BROKER DEALER ASSOCIATED INSURANCE COMPANY
- ------------------------------------ ------------------------------------
(NAME) (NAME)
- ------------------------------------ ------------------------------------
(STREET ADDRESS) (STREET ADDRESS)
- ------------------------------------ ------------------------------------
(CITY, STATE, ZIP) (CITY, STATE, ZIP)
BY: BY:
----------------------------------- ---------------------------------
PRINT NAME: PRINT NAME:
--------------------------- -------------------------
TITLE: TITLE:
-------------------------------- ------------------------------
FOR STATES:
-------------------------
WHEREAS, Glenbrook issues certain insurance products and group and individual
insurance contracts/polices and certificates participating therein
(collectively, "Contracts") described further in this Agreement and attached
Schedules, some of which may be deemed securities ("Registered Contracts") under
the Securities Act of 1933 ("1933 Act"); and
WHEREAS, Glenbrook has appointed ALFS< a broker/dealer, as the Underwriter of
the Registered Contracts; and
WHEREAS, BD is a broker/dealer engaged in the sale of securities and other
investment products; and
WHEREAS, in the event that Associated Insurance Agency and BD are the same
person, the duties, responsibilities and privileges of Associated Insurance
Agency under this Agreement shall be undertaken by BD; and
WHEREAS, Glenbrook and ALFS propose BD and Associated Insurance Agency to
solicit sales of the contracts;
NOW THEREFORE, in consideration of the premises and mutual promises contained
herein including the attached Schedule and Exhibits, the parties hereto agree as
follows:
<Page>
1. SUCCESSOR ORGANZATIONS
a. Glenbrook shall, in its sole discretion, have the right to
appoint a successor broker/dealer ("successor broker/dealer") to
replace ALFS as Underwriter of the Registered Contracts. Upon
appointment, successor broker/dealer shall assume all duties,
responsibilities and privileges undertaken by ALFS under this
Agreement. Glenbrook shall provide written notice of such change
in appointment to BD and Associated Insurance Agency.
b. Upon written notice to ALFS, BD shall have the right to appoint a
successor BD to assume its duties, responsibilities and
privileges under this Agreement. ALFS reserves the right to
reject the appointment of any successor BD and shall provide
written notice of such rejection to BD.
c. Upon written notice to Glenbrook, Associated Insurance Agency
shall have the right to appoint a successor Associated Insurance
Agency or additional Associated Insurance Agencies to assume its
duties, responsibilities and privileges under this Agreement.
Glenbrook reserves the right to reject the appointment of any
successor Associated Insurance Agency or additional Associated
Insurance Agencies and shall provide written notice of such
rejection to Associated Insurance Agency.
2. APPOINTMENT AND AUTHORIZATION
ALFS hereby authorizes BD to solicit sales of the Contracts that are
described more specifically in the Commission Schedule(s) attached hereto.
Glenbrook hereby appoints Associated Insurance Agency to solicit sales of
the Contracts. BD and Associated Insurance Agency accept such appointment
and authorization, and each agrees to use its best efforts to find
purchasers of the Contracts acceptable to Glenbrook.
3. REPRESENTATIONS
a. Glenbrook, ALFS, BD and Associated Insurance Agency each
represents to one another that it and the officers signing above
have full power and authority to enter into this Agreement, and
that this Agreement has been duty and validly executed by it and
constitutes a legal, valid and binding agreement.
b. ALFS represents to BD that ALFS (and any successor broker/dealer)
is registered as a broker/dealer with the Securities and Exchange
Commission (the "SEC") under the Securities Exchange Act of 1934
("1934 Act") and under the state securities laws of each
jurisdiction in which such registration is required for
underwriting the Contracts, and that it is a member of the
National Association of Securities Dealers, Inc. (the "NASD").
c. BD represents to ALFS that BD is, and at all times when
performing its functions and fulfilling its obligations under
this Agreement, will be, registered with the SEC as a
broker/dealer under the 1934 Act and under the state securities
laws of each jurisdiction in which such registration is required
for the sale of the Contracts, and a member of the NASD. BD will
notify ALFS in writing if such registration is terminated or
suspended, and shall take all reasonable actions to reinstate
such registrations.
d. BD represents to ALFS that BD has adopted supervisory procedures,
and its compliance manual addresses: (i) maintenance of
appropriate level of net capital; (ii) suitability review; (iii)
misrepresentations; and (iv) churning/replacements.
e. Associated Insurance Agency represents to ALFS and Glenbrook that
Associated Insurance Agency is, and at all times when performing
its functions and fulfilling its obligations under this
Agreement, will be, a properly licenses insurance agency in each
jurisdiction in which such licensing is required for the sale of
the Contracts.
f. Glenbrook represents to BD that the Registered Contracts,
including any variable separate account(s) supporting such
Registered Contracts, shall comply in all material respects with
the registration and other applicable requirements of the 1933
Act and the Investment Company Act of 1940, and the rules and
regulations there under, including the terms of any order of the
SEC with respect thereto.
<Page>
g. Glenbrook represents to BD and Associated Insurance Agency that
the Contracts it issues have been filed and approved by the state
insurance departments in such jurisdictions where it is
authorized to transact business and such filing and approval are
required prior to the issuance of Contracts therein.
h. Glenbrook represents to BD that the prospectuses included in
Glenbrook's Registration Statement for the Registered Contracts,
and in post-effective amendments thereto, and any supplements
thereto, as filed or to be filed with the SEC, as of their
respective effective dates, contain or will contain in all
material respects all statements and information which are
required to be contained therein by the 1933 Act and conform or
will conform in all material respects to the requirements
thereof.
4. COMPLIANCE WITH REGULATORY REQUIRMENTS
BD shall abide by all rules and regulation of the NASD governing the sale
of the Variable Contracts, including, but not limited to, requirements
regarding (i) net capital; (ii) suitability review; (iii)
misrepresentations; and (iv) churning/replacements. BD and Associated
insurance Agency shall comply with all applicable state and federal laws
and the rules and regulations of governmental or regulatory agencies
affecting or governing the sale of the Contracts. BD and Associated
Insurance Agency shall comply with all applicable administrative procedures
of Glenbrook and ALFS.
5. LICENSING AND/OR APPOINTMENT OF REPRENTATIVES
a. BD and Associated Insurance Agency are hereby specifically
authorized to designate those registered representatives of BD,
or individuals associated with the Associated Insurance Agency
("Agents"), proposed to be engaged in solicitation of sales of
the Contracts for appointment by Glenbrook as individual
insurance agents. BD and Associated Insurance Agency shall not
propose a registered representative, or Agent, for appointment
unless such representative, or Agent, is duly licenses as an
insurance agent in the state(s) in which it is proposed that such
representative, or Agent, engage in solicitations of sales of the
Contracts. BD and Associated Insurance Agency together shall be
responsible for registered representatives', and Agents',
compliance with applicable state insurance agent licensing laws.
b. BD and Associate Insurance Agency shall assist Glenbrook and ALFS
in the appointment of BD's registered representatives, and
Agents, under applicable Insurance laws, to sell the Contracts.
BD and Associated Insurance Agency shall comply with Glenbrook
requirements for, including the General Letter of Recommendation
(attached as Exhibit A), in submitting licensing or appointment
documentation for proposed registered representatives and Agents.
All such documentation shall be submitted by BD or Associated
Insurance Agency to Glenbrook or its designated agent licensing
administrator.
c. BD and Associated Insurance Agency agree to allow Glenbrook agent
appointment information in the possession of any of Glenbrook's
affiliates or subsidiaries to assist in appointing BD's
registered representatives and Associated Insurance Agency's
Agents to sell the Contracts under applicable insurance laws.
d. Glenbrook reserves the right to refuse to appoint any such
designated individual or, once appointed, to terminate or refuse
to renew the appointment of any such designated individual. Only
those registered representatives who are duly licenses as
insurance agents and appointed by Glenbrook (herein,
"Representatives") shall have authority to solicit sales of the
Contracts. Only those Agents who are registered representatives
of BD shall have authority to solicit sales of the Registered
Contracts. Agents who are not registered representatives of BD
shall be limited to selling those Contracts which are not
Registered Contracts ("Fixed Contracts"). BD and Associated
Insurance Agency shall notify ALFS immediately in writing if any
Representative appointed by Glenbrook ceases to be a registered
representative of BD or if any Representative or Agent ceases to
be properly licensed in any state.
<Page>
6. SUPERVISION OF REPRESENTATIVES AND AGENTS
a. BD shall have full responsibility for training and supervision of
all Representatives and all other persons associated with BD who
are involved directly or indirectly in the offer or sale of the
Registered Contracts, and all such persons shall be subject to
the control of BD with respect to such person's activities in
connection with the sale of the Registered Contracts. Associated
Insurance Agency shall have full responsibility for training and
supervision of all Agents who are involved directly or indirectly
in the offer or sale of the Contracts and for Agent's compliance
with applicable state insurance laws.
b. Glenbrook and ALFS shall not have responsibility for the training
and supervision of any Representative or Agency. BD and
Associated Insurance Agency each agree to comply with Glenbrook's
statement in support of the concepts in the Principles and Code
of Ethical Market Conduct of the Insurance Marketplace Standards
Association (the "IMSA Principles and Code"), as such statement
may be amended from time to time, and to engage in active and
fair competition as contemplated by the IMSA Principles and Code.
A copy of Glenbrook's current statement in support of the IMSA
Principles and Code is attached as Exhibit B.
c. Before Representatives engage in the solicitation of applications
for the Registered Contracts, BD and Associated Insurance Agency
will cause the Representatives (1) to be registered
representatives of BD; (2) to be licensed, registered or
otherwise qualified under applicable federal and state laws to
engage in the sale of the Contracts; (3) to be trained in the
sale of the Contracts; and (4) to limit solicitation of
applications for the Contracts to jurisdictions where Glenbrook
has authorized such solicitations.
d. Before Representatives or Agents engage in the solicitation of
applications for the Fixed Contracts, Associated Insurance Agency
will cause such individuals (1) to be licensed or otherwise
qualified under applicable laws to engage in the sale of the
Fixed Contracts; (2) to be trained in the sale of the Fixed
Contracts; and (3) to limit solicitation of applications for the
Fixed Contracts to jurisdictions where Glenbrook has authorized
such solicitations.
e. BD is specifically charged with the responsibility of supervising
and reviewing its Representatives' use of sales literature and
advertising and all other communications with the public in
connection with the Contracts. With regard to Registered
Contracts, no sales solicitation, including the delivery of
supplemental sales literature or other such materials, shall
occur, be delivered to, or used with a prospective purchaser
unless accompanied or preceded by the appropriate then current
prospectus(es), the then current prospectus(es) for the
underlying funds funding any variable contracts (the "Funds")
and, where required by state insurance law, the then current
statement of additional information for any variable contracts.
f. BD shall execute any electronic or telephone orders only in
accordance with the current prospectus applicable to the
Contracts and agrees, that in consideration for the telephone
transfer privileges, Glenbrook will not be liable for any loss
incurred as a result of acting upon electronic or telephone
instructions containing unauthorized, incorrect or incomplete
information received from BD or its representatives.
g. Upon request by Glenbrook, BD and Associated Insurance Agency
shall furnish appropriate records or other documentation to
evidence BD's and Associated Insurance Agency's diligent
supervision.
h. In the event a Representative or Agent performs any unauthorized
transaction(s) with respect to a Contract(s), BD shall bear sole
responsibility, shall notify Glenbrook and shall act to terminate
the sales activities of such Representative or Agent relating to
the Contract(s).
i. In the event a Representative or Agent fails to meet the BD's or
Associated Insurance Agency's rules and standards, BD or
Associated Insurance Agency, as the case may be, shall notify
Glenbrook and shall act to terminate the sales activities of such
Representative or Agent relating to the Contracts.
<Page>
7. SALES PROMOTION MATERIAL AND ADVERTISING
a. BD, Associated Insurance Agency, Agents and Representatives, in
connection with the offer or sale of the Contracts or
solicitation of a payment or other transaction under a Contract,
shall not give any information or make any representations or
statements, written or oral, concerning the Contracts or a Fund,
inconsistent with information or representations contained, in
the case of a Registered Contract, in the prospectus, statement
of additional information and registration statement for the
Contracts or such Fund, or in reports or proxy statements
thereof, or in promotional, sales or advertising material or
other information supplied and approved in writing by ALFS for
such use, or in the case of Fixed Contracts, in the contracts or
materials furnished by Glenbrook. BD, Associated Insurance
Agency, Agents and Representatives may not modify or represent
that they may modify any such prospectus, statement of additional
information, registration statement, and promotional, sales or
advertising materials.
b. No item of sales promotion materials or advertising relating to
the Contracts, including any illustrations or software programs
therefore, shall be used by BD, Associated Insurance Agency,
Agents or Representatives unless the specific item has been
provided by Glenbrook and ALFS or has first been approved in
writing by Glenbrook and ALFS for use. Glenbrook and ALFS reserve
the right to recall any material provided by them at any time for
any reason, and BD and Associated Insurance Agency shall promptly
comply with any such request for the return of material and shall
not use such material thereafter.
8. SOLICITING APPLICATIONS AND PAYMENTS
a. All applications for Contracts shall be made on application forms
supplied by Glenbrook. BD, Associated Insurance Agency, Agents
and the Representatives shall not recommend the purchase of a
Contract to a prospective purchaser unless it has reasonable
grounds to believe that such purchase is suitable for the
prospective purchaser and is in accordance with applicable
regulations of any state Insurance commission, and with respect
to Registered Contracts, the SEC and the NASD. While not limited
to the following a determination of suitability shall be based on
information concerning the prospective purchaser's insurance and
investment objectives and financial situation and needs. All such
determinations of suitability shall be approved by a Principal of
BD before forwarding such application to Glenbrook and ALFS.
b. BD and Associated Insurance Agency shall review applications for
completeness and correctness, as well as compliance with the
suitability standards specified above. BD will promptly, but in
no case later than the end of the next business day following
receipt by BD or a Representative, forward to Glenbrook according
to administrative procedures all complete and correct
applications for suitable transactions, together with any
payments received with the applications, without deduction for
compensation unless there has been a mutual arrangement for net
wire transmissions between ALFS, Glenbrook and BD. Glenbrook
reserves the right to reject any Contract application and return
any payment made in connection with an application that is
rejected.
c. Contracts issued on accepted applications will be forwarded to BD
for delivery to the Contract Owner according to procedures
established by Glenbrook, unless Glenbrook has provided
otherwise. BD shall cause each such Contract to be delivered to
the respective Contract Owner within five days after BD's
receipt. BD shall be liable to Glenbrook for any loss incurred by
Glenbrook (including consequential damages and regulatory
penalties) as a result of any delay by BD or a Representative in
delivering such Contract.
d. BD, Associated Insurance Agency, Agents and Representatives shall
not encourage a prospective purchaser to surrender or exchange a
Contract in order to purchase another insurance policy or
contract except when a change in circumstances makes the Contract
an unsuitable investment for the Contract owner.
<Page>
9. PAYMENTS RECEIVED BY BD
All premium payments (hereinafter collectively referred to as "Payments")
are the property of Glenbrook and shall be transmitted to Glenbrook by BD
immediately upon receipt by BD or Associated Insurance Agency or any Agent
or Representative in accordance with the administrative procedures of
Glenbrook, without any deduction or offset for any reason, including by
example but no limitation any deduction or offset for compensation claimed
by BD. CUSTOMER CHECKS SHALL BE MADE PAYABLE TO THE ORDER OF "GLENBROOK
LIFE AND ANNUITY COMPANY." Glenbrook reserves the right to reject any
Payment for any reason
10. COMMISSIONS PAYABLE
a. Commission's payable in connection with the Contracts shall be
paid to Associated Insurance Agency according to the Commission
Schedule(s) relating to this Agreement in effect at the time of
receipt by Glenbrook of the payment or transaction request on
which such commissions are based. If available, a Commission
Option(s) may: (1) be elected by BD and Associated Insurance
Agency on behalf of all of its Representatives or Agents or (2)
may be elected by each Representative or Agent at the time of
Application. Any election made and applied to a Contract may not
be changed and will be in effect for the life of the Contract.
Glenbrook and ALFS reserve the right to revise the Commission
Schedule(s) for new business at any time upon at least thirty
(30) days prior written notice to BD and Associated Insurance
Agency.
b. Compensation to Representatives or Agents for Contracts solicited
by the Representatives or Agents and issued by Glenbrook will be
governed by agreements between BD or the Associated Insurance
Agency and their respective Representatives or Agents any payment
thereof will be the BD's or Associated Insurance Agency's sole
responsibility.
11. REFUND OF COMMISSIONS
If Glenbrook is required to refund premiums or return contract values and
waive surrender charges on any Contract for any reason, then commission
will be adjusted with respect to said premiums or Contract as set forth in
the Commission Schedule, and any commission previously paid for said
premiums must be refunded to Glenbrook or ALFS. ALFS shall have the right
to offset any such refundable commission against amounts otherwise payable
by ALFS. ALFS agrees to notify BD and Associated Insurance Agency within
thirty (30) days after it receives notice from Glenbrook of any premium
refund or a commission charge back.
12. ASSOCIATED INSURANCE AGENCY
BD and the Associated Insurance Agency represent that they are in
compliance with the terms and conditions of no-action letters issued by the
staff of the SEC with respect to non-registration as a broker/dealer of an
insurance agency associated with a registered broker/dealer. BD and
Associated Insurance Agency shall notify ALFS immediately in writing if BD
and/or such agency fail to comply with any such terms and conditions and
shall take such measures as may be necessary to comply with any such terms
and conditions. If Associated Insurance Agency is the same person as BD,
this Paragraph 12 does not apply, and BD shall undertake all the duties,
responsibilities and privileges under this Agreement.
13. HOLD HARMLESS AND INDEMNIFICATION PROVISIONS
a. No party to this agreement will be liable for any obligation, act
or omission of any other party. BD and Associated Insurance
Agency will hold harmless and indemnify Glenbrook and ALFS, and
conversely, Glenbrook and ALFS will hold harmless and indemnify
BD and Associated Insurance Agency for any loss or expense
suffered as a result of the violation or noncompliance by the
indemnifying party of or with any applicable law or regulation or
any provision of this Agreement. Further, any BD violation or
noncompliance by an associated person, as defined in Article 1 of
the NASD By-Laws, would be covered under this provision.
<Page>
b. Without limited the above paragraph, in situations when "as of"
pricing is necessary in connection with the Contracts (and a loss
is incurred to compensate the Contract owner for reduced Contract
values) the party whose actions resulted in the loss will bear
the costs according to pricing procedures established by
Glenbrook.
14. NON-ASSIGNABILITY PROVISION
This Agreement may not be assigned by any party except by mutual consent of
all other parties.
15. NON-WAIVER PROVISION
Failure of any party to terminate the Agreement for any of the causes set
forth in this Agreement will not constitute a waiver of that party's right
to terminate this Agreement at a later time for any of these causes.
16. AMENDMENTS
Except as stated in Paragraph 10, no amendment to this Agreement will be
effective unless it is in writing and signed by all the parties hereto.
17. RECERTIFICATION
BD and Associated Insurance Agency shall, on a periodic basis determined by
Glenbrook and ALFS, certify that they are in compliance with all terms and
provisions of this Agreement.
18. INDEPENDENT CONTRACTORS
BD and its Representatives, and Associated Agency and its Agents, are
independent contractors with respect to Glenbrook and ALFS.
19. NOTIFICATION OF CUSTOMERS COMPLIANTS OR DISCIPLINARY PROCEEDINGS
a. BD and Associated Insurance Agency agree to notify ALFS promptly
of any customer complaints or disciplinary proceedings against
BD, Associated Insurance Agency or any Representatives or Agents
relating to the Contracts or any threatened or filed arbitration
action or civil litigation arising out of solicitation of the
Contracts.
b. BD and Associated Insurance Agency shall cooperate with Glenbrook
in investigating and responding to any customer complaint,
attorney demand, or inquiry received from state insurance
departments or other regulatory agencies or legislative bodies,
and in any settlement or trial of any actions arising out of the
conduct of business under this Agreement.
c. Any response by BD or Associated Insurance Agency to an
individual customer compliant will be sent to Glenbrook and ALFS
for approval not less than five (5) business days prior to it
being sent to the customer, except that if a more prompt response
is required, the proposed response may be communicated by
telephone, facsimile or in person.
20. BOOKS, ACCOUTNS AND RECORDS
a. BD and Associated Insurance Agency agree to maintain books,
accounts and records so as to clearly and accurately disclose the
nature and details of transactions relating to the Contracts and
to assist Glenbrook and ALFS in the timely preparation of their
respective books accounts and records. BD and Associated
Insurance Agency shall upon request submit such books, accounts
and records to the regulatory and administrative bodies which
have jurisdiction over Glenbrook or the Funds.
b. Each party to this Agreement shall promptly furnish to the other
parties any reports and information which another party may
request for the purpose of meeting its reporting and record
keeping
<Page>
obligations under the insurance laws of any state, and under the
federal and state securities laws or the rules of the NASD.
21. LIMITATIONS
No party other than Glenbrook shall have authority on behalf of Glenbrook
to make, alter, or discharge any Contract issued by Glenbrook, to waive any
forfeiture provision or to grant, permit, or extend the time of making any
Payments, or to alter the forms which Glenbrook may prescribe or substitute
other forms in place of those prescribed by Glenbrook or to enter into any
proceeding in a court of law or before a regulatory agency in the name of
or on behalf of Glenbrook.
22. CONFIDENTIALITY
Each party to this Agreement shall maintain the confidentiality of any
material designated as proprietary by another party, and shall not use or
disclose such information without the prior written consent of the party
designating such material as proprietary.
23. TERMINATION
a. This Agreement may be terminated at the option of any party upon
ten (10) days written notice to the other parties, or at the
option of any party hereto upon the breach by any party of the
covenants and terms of this Agreement. Paragraph 13 shall survive
any such termination.
b. This Agreement may be terminated immediately for cause upon an
event of default. Such termination shall be deemed to occur as of
the date immediately preceding the event of default. An "event of
default" shall occur when the first of the (i) BD or Associated
Insurance Agency files for bankruptcy, or financial or corporate
reorganization under federal or state insolvency law; (ii)
applicable laws or regulations prohibit BD or Associated
Insurance Agency from continued marketing of the Contracts.
24. NOTICE
a. In the event of sale, transfer or assignment of a controlling
interest in BD or Associated Insurance Agency, notice shall be
provided in writing to Glenbrook no less than thirty (30) days
prior to the closing date.
b. All notices to Glenbrook and ALFS relating to this Agreement will
be duly provided by certified or express mail to:
General Counsel
Glenbrook Life and Annuity Corporation
3100 Sanders Road
Northbrook, Illinois 60062
c. All notices to BD and Associated Insurance Agency will be duty
provided if mailed to their respective address show on the Agency
Specification/Signature Page(s).
25. SEVERABLITY
Should any provision of this Agreement be held unenforceable, those
provisions not affected by the determination of unenforceability shall
remain in full force and effect.
26. GOVERNING LAW
This Agreement will be construed in accordance with the laws of the State
of Illinois.
<Page>
EXHIBIT A
GENERAL LETTER OF RECOMMENDATION
BD hereby certifies to Glenbrook Life and Annuity Company ("Glenbrook") that all
the following requirements will be fulfilled in conjunction with the submission
of appointment papers for all applicants as agents of Glenbrook submitted by BD.
BD will, upon request, forward proof of compliance with same to Glenbrook in a
timely manner.
1. We have made a thorough and diligent inquiry and investigation
relative to each applicant's identify, residence, business reputation,
and experience and declare that each applicant is personally known to
us, has been examined by us, is known to be of good moral character,
has a good business reputation, is reliable, is financially
responsible and is worthy of appointment as a variable contract agent
of Glenbrook. This inquiry and background investigation has included a
credit and criminal check on each applicant. Based upon our
investigation, we vouch for each applicant and certify that each
individual is trustworthy, competent and qualified to act as an agent
for Glenbrook to hold himself out in good faith to the general public.
2. We have on file the appropriate state insurance department licensing
forms (i.e. B-300, B-301), or U-4 form which was completed by each
applicant. We have fulfilled all the necessary investigative
requirements for the registration of each applicant as a registered
representative thorough our NASD member firm, and each applicant is
presently registered as a NASD registered representative.
The above information in our files indicates no fact or condition
which would disqualify the applicant from receiving a license or
appointment and all the findings of all investigative information is
favorable.
3. We certify that all educational requirements have been met for the
specific state each applicant is licensed in; and that, all such
persons have fulfilled the appropriate examination, education and
training requirements.
4. We certify that each applicant will receive close and adequate
supervision, and that we will make inspection when needed of any or
all risks written by these applicants, to the end that the insurance
interest of the public will be properly protected.
5. We will not permit any applicant to transact insurance as an agent
until duly licensed and appointed by Glenbrook. No applicants have
been given a contract or furnished supplies, nor have any applicants
been permitted to write, solicit business, or act as an agent in any
capacity on behalf of Glenbrook, and they will not be so permitted
until the certificates of authority applied for is received.
<Page>
EXHIBIT B
ETHICAL MARKET CONDUCT COMPLIANCE
BD and Associated Insurance Agency (also referred to as "you" or "your") are
required to comply with Glenbrook's policies and procedures concerning the
replacement of life insurance policies and annuity polices. A replacement occurs
whenever an existing life insurance policy or annuity is terminated, converted
or otherwise changed in value. For any transaction involving a replacement,
Glenbrook requires you to:
1. recommend the replacement of an existing policy only when replacement
is in the best interest of the customer;
2. fully disclose all relevant information to the customer, which
information includes: a) comparison of old and new premiums, expenses
and surrender charges, cash values, and death benefits; b) any loss of
cash value or policy value by surrendering the existing policy; c) all
guaranteed and maximum value of both policies; d) the fact that a new
contestability and suicide period starts under the new policy; and e)
the requirement that the customer must be re-underwritten for the new
policy;
3. provide state-required replacement notices to customers on the same
day the application is taken and indicate on the application that the
transaction involves the full or partial replacement of an existing
policy;
4. submit, all advertising materials intended to promote the sale of any
Glenbrook product to the home office for approval prior to use;
5. immediately report to Glenbrook any customer complaints, whether
written or oral, and assist Glenbrook in resolving the complaint to
the satisfaction of all parties;
6. communicate these standards to any producers or office personnel that
you directly supervise and request their agreement to be bound by
these conditions as well.
Glenbrook and ALFS may terminate this Agreement without notice if you fail to
comply with Glenbrook's rules and requirements concerning the replacement of
life insurance and annuities and Glenbrook's rules and requirements concerning
ethical market conduct.
Your right to any commissions or any other thing of value shall cease if you
violate laws and regulations governing unfair trade practices, life insurance
and annuity advertising, replacement of life insurance and annuities, sales
illustrations and agent licensing.
By promoting the sale of a Glenbrook product to a customer, you agree to be
bound by the terms and conditions of this Addendum without modification.
<Page>
SCHEDULE A
SCHEDULE OF COMMISSIONS
Subject to terms and conditions of the Selling Agreement, Associated Insurance
Agency shall be compensated for Registered Contracts issued according to the
following chart.
AIM LIFETIME PLUS SINGLE PREMIUM VARIABLE LIFE
<Table>
<Caption>
COMMISSION OPTIONS
-----------------------------
PLAN ISSUE AGE A B
- -----------------------------------------------------------------------------------------
0-80 7.50%* 6.25%*
No trail .25% trail**
Single Life
81-85 6.00%* 5.00%*
No trail .25% trail**
18-80 7.50%* 6.25%*
No trail .25% trail**
Last Survivor
81-85 6.00%* 5.00%*
No trail .25% trail**
</Table>
* = Based upon purchase payment
** = Trail commissions are based on the contract value on the last day of each
contract quarter beginning with the last day of the 15th contract month. Trail
commissions will be paid each calendar quarter beginning with the first calendar
quarter following the 15th contract month and ending when the contract has
expired; the contract must be effect through the end of the contract quarter for
a trail commission to be paid.
In the event a Partial Withdrawal occurs, trail commissions will continue to be
paid in any quarter in which the contract remains in force.
In the event that any AIM LIFETIME PLUS Single Premium Variable Life is
surrendered during the "free look" period, there will be a full chargeback of
commission.
<Page>
SCHEDULE A
SCHEDULE OF COMMISSIONS
Subject to terms and conditions of the Selling Agreement, Associated Insurance
Agency shall be compensated for VA Contracts issued according to the following
chart (based upon the option selected in writing by each Agent or
Representative):
AIM LIFETIME PLUS VARIABLE ANNUITY
<Table>
<Caption>
COMMISSION OPTIONS
ISSUE AGE ---------------------------------------------------
A B
- -----------------------------------------------------------------------------------------------
0-80 5.75%* 4.75%*
No trail .25% trail**
4.75%* 3.50%*
81-85 No trail .25% trail**
86-90 2.50%* 1.25%*
No trail .25% trail**
</Table>
* = Based upon purchase payment
** = Trail commissions are based on the contract value on the last day of each
contract quarter beginning with the last day of the 15th contract month. Trail
commissions will be paid each calendar quarter beginning with the first calendar
quarter following the 15th contract month and ending when the contract is
annuitized; the contract must be in effect through the end of the contract
quarter for a trail commission to be paid.
COMMISSION CHARGEBACKS
<Table>
<Caption>
TRANSACTION PERIOD OF CHARGEBACK CHARGEBACK PLEASE NOTE
- ----------------------------------------------------------------------------------------------------------------------
Surrender During the "free look" 100% of commission N/A
period
For issue ages 81-85 on
Annuitization Months 1-12 following a Commission will be Option B and ages 86-90,
purchase payment adjusted to equal 4.25% Options A and B, no
adjustment will be made
</Table>
<Page>
SCHEDULE A
SCHEDULE OF COMMISSIONS
Subject to terms and conditions of the Selling Agreement, Associated Insurance
Agency shall be compensated for VA Contracts issued according to the following
chart (based upon the option selected in writing by each Agent or
Representative):
AIM LIFETIME PLUS II VARIABLE ANNUITY
<Table>
<Caption>
COMMISSION OPTIONS
ISSUE AGE ---------------------------------------------------
A B
- -----------------------------------------------------------------------------------------------
0-80 5.75%* 4.75%*
No trail .25% trail**
4.75%* 3.50%*
81-85 No trail .25% trail**
86-90 2.75%* 2.25%*
No trail .25% trail**
</Table>
* = Based upon purchase payment
** = Trail commissions are based on the contract value on the last day of each
contract quarter beginning with the last day of the 15th contract month. Trail
commissions will be paid each calendar quarter beginning with the first calendar
quarter following the 15th contract month and ending when the contract is
annuitized; the contract must be in effect through the end of the contract
quarter for a trail commission to be paid.
COMMISSION CHARGEBACKS
<Table>
<Caption>
TRANSACTION PERIOD OF CHARGEBACK CHARGEBACK PLEASE NOTE
- ----------------------------------------------------------------------------------------------------------------------
Surrender During the "free look" 100% of commission N/A
period
For issue ages 81-85 on
Annuitization Months 1-12 following a Commission will be Option B and ages 86-90,
purchase payment adjusted to equal 4.25% Options A and B, no
adjustment will be made
</Table>
<Page>
SCHEDULE A
SCHEDULE OF COMMISSIONS
Subject to terms and conditions of the Selling Agreement, Associated Insurance
Agency shall be compensated for VA Contracts issued according to the following
chart (based upon the option selected in writing by each Agent or
Representative):
AIM LIFETIME ENHANCED CHOICE VARIABLE ANNUITY
<Table>
<Caption>
COMMISSION OPTIONS
ISSUE AGE ---------------------------------------------------
A B
- -----------------------------------------------------------------------------------------------
0-80 5.50%* 4.25%*
No trail .25% trail**
</Table>
* = Based upon purchase payment
** = Trail commissions are based on the contract value on the last day of each
contract quarter beginning with the last day of the 15th contract month. Trail
commissions will be paid each calendar quarter beginning with the first calendar
quarter following the 15th contract month and ending when the contract is
annuitized; the contract must be in effect through the end of the contract
quarter for a trail commission to be paid.
COMMISSION CHARGEBACKS
<Table>
<Caption>
TRANSACTION PERIOD OF CHARGEBACK CHARGEBACK PLEASE NOTE
- ----------------------------------------------------------------------------------------------------------------------
Surrender During the "free look" 100% of commission N/A
period
Annuitization Months 1-12 following a Commission will be
purchase payment adjusted to equal 4.25% N/A
</Table>