EXHIBIT 10.14
TERMINATION AND TRANSITION AGREEMENT
This Termination and Transition Agreement (this "Agreement") is entered into
this 31st day of January, 1996, by and among JMC Group, Inc., a California
corporation, Xxxxx Xxxxxxxx & Co., a California corporation, and its affiliate,
Priority Investment Services, Inc., a Delaware corporation ("Priority") and
First Tennessee Bank National Association ("FTB"), in its own capacity and as
trustee under the Trust Agreement, dated August 31, 1988, as amended from time
to time, by and between Xxxxx Xxxxxxxx & Co., as trustor and FTB, as trustee of
the trust thereby established.
RECITALS
A. In August, 1988, Xxxxx Xxxxxxxx & Co. and FTB entered into a Services
Agreement pursuant to which Xxxxx Xxxxxxxx & Co. and its subsidiaries agreed to
provide certain services to FTB, in its own capacity and as trustee, and to the
Trust (as hereinafter defined).
B. In January, 1994, FTB, JMC Group, Inc., Xxxxx Xxxxxxxx & Co. and
Priority entered into a series of agreements which expanded the nature of the
parties' relationship with each other and restated the terms of the original
Services Agreement. As a result of this transaction, the parties' existing
relationship is currently governed by the terms of the following agreements:
(i) a Services Agreement and Services Agreement Supplement No. 1,
each dated January 28, 1994, by and among JMC Group, Inc., Xxxxx Xxxxxxxx & Co.,
Priority and FTB;
(ii) a Mutual Fund Sales Agreement and Mutual Fund Sales Agreement
Supplement No. 1, each dated January 28, 1994, by and among JMC Group, Inc.,
Xxxxx Xxxxxxxx & Co., Priority and FTB;
(iii) a Trust Agreement, dated August 31, 1988, by and between Xxxxx
Xxxxxxxx & Co. and FTB;
(iv) an Option Agreement, dated January 28, 1994, by and among JMC
Group, Inc., Xxxxx Xxxxxxxx & Co., Priority and FTB; and
(v) a Service Xxxx License Agreement, dated January 28, 1994, by and
among JMC Group, Inc., Xxxxx Xxxxxxxx & Co., Priority and FTB.
C. FTB desires to provide mutual funds and annuity products to its
customers through its affiliated broker-dealer, First Tennessee Brokerage, Inc.
("FTBR"), and certain FTB platform employees.
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D. FTB, JMC Group, Inc., Priority and Xxxxx Xxxxxxxx & Co. have agreed to
terminate the Existing Agreements (as hereinafter defined) prior to the
expiration of their original terms and enter into a new arrangement whereby JMC
(as hereinafter defined) will provide support services for FTB's and FTBR's
annuity and mutual fund sales programs pursuant to the ISS Agreement (as
hereinafter defined). FTB, JMC Group, Inc., Xxxxx Xxxxxxxx & Co. and Priority
have previously manifested their intent to terminate the Existing Agreements and
enter into the ISS Agreement by execution and delivery of that certain letter of
understanding, dated December 8, 1995.
AGREEMENT
In consideration of the foregoing, the mutual covenants and undertakings herein
set forth and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto agree as
follows:
ARTICLE I
DEFINITIONS
Capitalized terms used in this Agreement shall have the following meanings.
Capitalized terms used herein but not otherwise defined herein shall have the
meanings assigned to those terms in the ISS Agreement.
1.1 "Action(s)" means any and all actions, suits or proceedings.
1.2 "Clearing Agreement" means that certain Clearing Agreement, dated the date
hereof, by and between JMC Financial Corporation and FTBR.
1.3 "Contract Term" has the meaning assigned to that term in the ISS Agreement.
1.4 "Current Annuity Block" means the block of business consisting of insurance
and annuity policies sold by JMC or Priority to FTB customers from the inception
of the annuity sales program at FTB in August 1988 through the Termination Date,
together with any and all additional premiums added to such policies after the
Termination Date, which policies are still in force.
1.5 "Current Block" means the block of business consisting of the Current
Annuity Block and the Current Mutual Fund Block.
1.6 "Current Block Annuity Product(s)" means any insurance or annuity policy
which is part of the Current Block. A list of the Current Block Annuity
Products is attached hereto as Exhibit A.
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1.7 "Current Block Product Provider(s)" means any Product Provider whose
product is a Current Block Annuity Product.
1.8 "Current Mutual Fund Block" means the block of business consisting of all
mutual fund shares sold by Priority to FTB customers from the inception of the
mutual fund sales program at FTB in February 1994 through the Termination Date,
which shares are still outstanding.
1.9 "Customer Complaint(s)" means any complaint (whether written or oral)
received by JMC, any of its subsidiaries or affiliates, or by any officer,
director, agent or employee of any of them or by FTB, any of its subsidiaries or
affiliates, or by any officer, director, agent or employee of any of them from
any person (including state and governmental agencies, departments, divisions or
offices or self-regulatory organizations) with respect to: (i) annuity,
insurance or mutual fund sales or servicing made or provided by JMC or Priority
personnel prior to the Termination Date; (ii) servicing of annuity, insurance
and mutual fund products provided by JMC personnel after the Termination Date
pursuant to the ISS Agreement or the Clearing Agreement; or (iii) the FTB
Program.
1.10 "Definitive Agreements" means this Agreement, the ISS Agreement and the
Clearing Agreement.
1.11 "Dispute" shall have the meaning assigned to that term in SECTION 6.7.1
hereof.
1.12 "Existing Agreements" means the License Agreement, the Services Agreement,
the Mutual Fund Agreement and the Option Agreement.
1.13 "FTB" means First Tennessee Bank National Association, a federally-
chartered national bank.
1.14 "FTB Employee" means all employees and agents of FTB and FTBR or any of
their affiliates, but does not include any employee of FTB's Bond Division.
1.15 "FTBR" means First Tennessee Brokerage, Inc., a Tennessee corporation and
registered broker-dealer and member of the NASD.
1.16 "FTB Program" means the internal mutual fund and annuity sales programs of
FTB or its affiliates (including the Platform Program) which target customers
with investable assets of less than $250,000, but does not include any sales
program of FTB's Bond Division.
1.17 "Integrated Support Services" means the services provided to FTB and FTBR
by JMC pursuant to the terms of the ISS Agreement and the Clearing Agreement.
1.18 "ISS Agreement" means that certain Integrated Support Services Agreement,
dated the date hereof, between Xxxxx Xxxxxxxx & Co. and its subsidiaries, FTB
and FTBR.
1.19 "JMC" means Xxxxx Xxxxxxxx & Co. and its subsidiaries.
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1.20 "JMCG" means JMC Group, Inc., Xxxxx Xxxxxxxx & Co. and Priority.
1.21 "Letter of Understanding" means that certain letter of understanding,
dated December 8, 1995, by and among JMCG and FTB.
1.22 "License Agreement" means that certain Service Xxxx License Agreement,
dated January 28, 1994, by and among JMCG and FTB.
1.23 "Minimum Monthly Production" shall have the meaning assigned to that term
in SECTION 3.5.2 hereof.
1.24 "Monthly Production" shall have the meaning assigned to that term in
SECTION 3.5.2 hereof.
1.25 "NASD" means the National Association of Securities Dealers, Inc.
1.26 "Monthly Subsidy" shall have the meaning assigned to that term in SECTION
3.5 hereof.
1.27 "Mutual Fund Agreement" means that certain Mutual Fund Sales Agreement and
Mutual Fund Sales Agreement Supplement No. 1, each dated January 28, 1994, by
and among JMCG and FTB.
1.28 "Option Agreement" means that certain Option Agreement, dated January 28,
1994, by and among JMCG and FTB.
1.29 "Plan" shall have the meaning assigned to that term in SECTION 3.4.2
hereof.
1.30 "Platform Program" means the platform fixed annuity sales program
initiated by FTB under the terms of the Letter of Understanding pursuant to
which FTB Employees will make only fixed annuity sales of less than $20,000.
1.31 "Priority" means Priority Investment Services, Inc., a Delaware
corporation.
1.32 "Product Provider(s)" means the company underwriting or distributing any
insurance, annuity or mutual fund product.
1.33 "Regulator(s)" means the NASD or other regulatory authority having
jurisdiction over the activities of any party hereto.
1.34 "Selected Sales Personnel" shall have the meaning assigned to that term in
SECTION 3.3.1 hereof.
1.35 "Services Agreement" means that certain Services Agreement and Services
Agreement Supplement No. 1, each dated January 28, 1994, by and among JMCG and
FTB.
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1.36 "Service Center" means JMC's Memphis Service Center.
1.37 "Set-Up Fees" shall have the meaning assigned to that term in SECTION
4.2.1.1 of the ISS Agreement.
1.38 "Subsidy Period" means the period commencing December 1, 1995 and ending
on the Termination Date.
1.39 "Termination Date" means the effective date of termination of the Existing
Agreements as provided in SECTION 2.1.1 hereof.
1.40 "Transition Period" means the period commencing December 8, 1995 and
ending on the Termination Date.
1.41 "Trust" means the trust established by the Trust Agreement.
1.42 "Trust Agreement" means that certain Trust Agreement, dated August 31,
1988, as amended from time to time, by and between Xxxxx Xxxxxxxx & Co. and FTB.
1.43 "Trustee" means FTB in its capacity as trustee of the Trust.
1.44 "Trustor" means Xxxxx Xxxxxxxx & Co. in its capacity as trustor of the
Trust.
ARTICLE II
TERMINATION
2.1 TERMINATION OF EXISTING AGREEMENTS.
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2.1.1 The Existing Agreements will terminate as soon hereafter as possible
on a date to be agreed to by the parties hereto, but in no event later than
February 29, 1996 (the "Termination Date"); provided, however, that if, on
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February 29, 1996, Definitive Agreements have not been entered into due to
(i) pending regulatory review or approval of any Definitive Agreement or
(ii) acts of God, earthquakes, fire or floods, the Termination Date shall
be such later date as may be agreed upon by the parties.
2.1.2 On the Termination Date, FTB's and JMCG's continuing obligations
under the Existing Agreements will terminate and all outstanding
obligations under the Existing Agreements will be discharged and cease to
exist; provided, however, that the parties' obligations under the following
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provisions of the Existing Agreements shall survive the termination thereof
and nothing herein or in the other Definitive Agreements shall alter or in
any way modify these provisions:
2.1.2.1 Sections 8.1 and 8.2 of the Mutual Fund Agreement and
Sections 9.1 through 9.3 of the Services Agreement;
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2.1.2.2 Sections 5.4 and 6.4 of the Mutual Fund Agreement and
Sections 6.4 and 7.5 of the Services Agreement;
2.1.2.3 Section 5.5 of the Mutual Fund Agreement and Section 6.5 of
the Services Agreement; and
2.1.2.4 Section 9 of the License Agreement.
2.1.3 After termination of the Existing Agreements, except as expressly
outlined above, all rights and obligations of the parties to the Existing
Agreements with respect to the subject matter thereof shall be governed by
the terms of the Definitive Agreements.
2.1.4 Promptly following the Termination Date, Priority will initiate all
actions required to change its name from "Priority Investment Services,
Inc." to some other name which shall not include the word "Priority."
2.2 CONDITIONS TO COMMENCEMENT OF CONTRACT TERM. The Contract Term shall
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commence on the Termination Date. The commencement of the Contract Term is
subject to the prior or concurrent satisfaction of the following conditions:
2.2.1 The completion of all actions necessary to permit JMC to deliver the
Integrated Support Services in the manner contemplated by the ISS Agreement
and in full compliance with all applicable laws, rules and regulations.
2.2.2 The completion of all actions necessary to permit FTB and FTBR to
perform their supervision, management and compliance obligations under
SECTION 3.1 of the ISS Agreement in the manner contemplated by the ISS
Agreement and in full compliance with all applicable laws, rules and
regulations.
2.2.3 The preparation, negotiation, execution and delivery of all other
necessary documentation between FTB, FTBR, JMC and the Product Providers,
including, without limitation, master general agency agreements, selling
agreements, networking and clearing agreements and the like, which
documentation will permit the commission fund flow outlined in the ISS
Agreement to be accomplished in a manner that meets all applicable legal
and regulatory requirements.
2.2.4 JMC demonstrating that, with respect to customer account
information, it can provide FTB or FTBR, as the case may be, with tapes
containing customer account information on a monthly basis and that it will
have the ability to provide mutual fund customers who call the operations
center with the most recent share balance and account value information, if
any, which is available through networking with the mutual fund Product
Provider.
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The failure to meet any of the conditions outlined in this SECTION 2.2
shall not entitle either party to postpone the Termination Date beyond February
29, 1996. The Termination Date may only be extended as provided in SECTION
2.1.1 hereof.
2.3 COMPENSATION AND FEES.
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2.3.1 Prior to the Termination Date, JMCG shall continue to calculate and
pay FTB's compensation under the Services Agreement and the Mutual Fund
Agreement as provided therein.
2.3.2 Upon termination of the Existing Agreements, JMCG shall prepare a
final statement of all amounts due to FTB under the terms of the Mutual
Fund Agreement for mutual fund sales prior to the Termination Date and
shall pay such amount to FTB in accordance with the terms of the Mutual
Fund Agreement. On the Termination Date (but no sooner than February 1,
1996), FTB shall pay JMCG all deferred revenue due JMCG with respect to
sales of First Funds prior to the Termination Date, including, without
limitation, an amount equal to the sum of AGENT's Deferred First Fund Share
(as that term is defined in Supplement No. 1 to the Mutual Fund Agreement)
for each of the twelve months immediately preceding the Termination Date
and all other revenue earned by JMCG prior to the Termination Date with
respect to First Fund sales which revenue has not been paid on or prior to
the Termination Date. For purposes of the immediately preceding sentence
only, AGENT's Deferred First Fund Share for the twelve months immediately
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preceding the Termination Date shall be equal to the product of (i) 53
basis points and (ii) the sum of First Fund Gross Monthly Production for
each of the twelve months immediately preceding the Termination Date. All
other calculations of AGENT's Deferred First Fund Share shall be made in
accordance with the terms of the Mutual Fund Agreement.
2.3.3 Upon termination of the Existing Agreements, JMCG will prepare a
final statement of all Set-up Fees due FTB, in its capacity as Trustee,
under the terms of the Services Agreement for deposits made to the Trust
prior to the Termination Date and shall pay such amount to FTB in
accordance with the terms of the Services Agreement.
ARTICLE III
SALES AND SERVICING
3.1 DURING THE TRANSITION PERIOD.
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3.1.1 Subject to SECTION 3.1.2 hereof, during the Transition Period, JMCG
and FTB will continue to perform their respective obligations under the
Existing Agreements according to the terms thereof.
3.1.2 Notwithstanding Section 8.2 of the Services Agreement (and as such
provision may be incorporated into the Mutual Fund Agreement), during the
Transition Period,
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3.1.3 JMCG agrees that FTB may institute the Platform Program. JMCG's
rights under Section 8.2 of the Services Agreement (and as such provision
may be incorporated into the Mutual Fund Agreement) are hereby waived, but
only to the extent necessary to permit FTB to commence the Platform
Program.
3.2 AFTER THE TERMINATION DATE.
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3.2.1 JMCG hereby acknowledges that, from and after the Termination Date,
FTB is free of any restrictions imposed by the Existing Agreements with
respect to the offering of annuity or mutual funds directly to its
customers. On the Termination Date, FTB, either directly or through its
affiliate, FTBR, will assume full responsibility (including financial
responsibility) for all sales, sales management and compliance aspects of
the FTB Program as provided in the ISS Agreement.
3.2.2 Except as expressly provided in the ISS Agreement, on the
Termination Date, FTB, either directly or through its affiliate, FTBR, will
assume all of JMCG's rights, duties and obligations as Agent for the Trust
pursuant to the Services Agreement and the Trust Agreement and JMCG will
cease to have any responsibilities thereunder. Subject to SECTION 12.2 of
the ISS Agreement, this SECTION 3.2.2 is not intended to relieve JMCG of
its obligations to indemnify FTB, its officers, agents or employees as
provided in the Trust Agreement for any losses which arise out of events
occurring or circumstances existing prior to the Termination Date.
3.3 JMC PERSONNEL.
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3.3.1 FTB or FTBR will extend offers of employment to no fewer than ten of
JMC's existing sales representatives who are currently servicing FTB. FTB
will notify JMC of the identity of the successful sales candidates (the
"Selected Sales Personnel").
3.3.2 FTB agrees to assist, on a best efforts basis, all JMCG personnel
employed in the Service Center in securing permanent positions with FTB or
FTBR. In the event FTB or FTBR desire to hire any of the Service Center
personnel, FTB, FTBR and JMCG will mutually agree on hire dates.
3.3.3 FTB and JMCG agree that JMCG may, in its sole discretion, terminate
any or all JMCG sales representatives who are not offered positions with
FTB or FTBR at anytime after December 18, 1995. JMCG, FTB and FTBR agree
that the provisions of this SECTION 3.3 are not intended to reflect an
agreement to employ any particular JMCG sales representative or service
center employee and no such individual is intended to be a third party
beneficiary of this Agreement.
3.3.4 JMCG will terminate the employment of all Selected Sales Personnel
on the Termination Date. The actual Termination Date will be February 29,
1996 or such earlier date agreed to by the parties hereto on which JMCG and
FTB have met all conditions precedent to the commencement of the Contract
Term as provided in SECTION 2.2 hereof.
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The failure to meet such conditions shall not entitle any party to postpone
the Termination Date which may only be extended as provided in SECTION
2.1.1 hereof.
3.4 SERVICE CENTER.
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3.4.1 FTB agrees that JMCG may close the Service Center at any time after
December 8, 1995. Upon execution of the Letter of Understanding, FTB waived
the requirement contained in Schedule B of the Services Agreement that JMCG
maintain a service center for the FTB annuity and mutual fund sales
program.
3.4.2 JMCG shall submit a written transition plan to FTB for the closing
of the Memphis Service Center and the transition of the operations to its
central operations center in San Diego, California no earlier than January
15, 1996 (the "Plan"). The Plan shall ensure that JMCG will continue to
perform its obligations under the Existing Agreements in accordance with
the Performance Standards of Schedule C to the Services Agreement during
the Transition Period.
3.5 SALES PERSONNEL SUBSIDY PAYMENTS. JMCG, FTB and FTBR acknowledge that FTB
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and FTBR intend to identify the Selected Sales Personnel by December 18, 1995.
However, no Selected Sales Personnel will actually begin employment with FTB or
FTBR until after the Termination Date. JMCG and FTB agree that FTB will
reimburse Priority for fifty percent (50%) of the cost of Priority carrying the
Selected Sales Personnel on its payroll during the Subsidy Period. This amount
will be paid to Priority in the form of a monthly subsidy (the "Monthly
Subsidy") payable on the fifteenth (15th) day of the next succeeding month. The
Monthly Subsidy for each month shall be calculated and paid in the following
manner:
3.5.1 Priority shall calculate the sum of all fixed compensation (salary
plus travel allowance) paid to the Selected Sales Personnel during that
month and add 25% of the salary as a benefit factor. Fifty percent (50%)
of this sum shall be the Monthly Subsidy.
3.5.2 Priority shall then determine the Monthly Combined Gross Insurance
and Mutual Fund Production for that month for all Priority's Tennessee-
based sales employees by reference to the Sales Accounting Report generated
by Priority (the "Monthly Production"). FTB shall pay Priority a Monthly
Subsidy for each month in the Transition Period during which the Monthly
Production is less than the Minimum Monthly Production (as hereinafter
defined) for that month. The "Minimum Monthly Production" for any month
shall be the amount set forth in the following table for such month unless
the weighted average number of Selected Sales Personnel Priority has
carried on its payroll during that month is greater than or less than 10.
In such circumstance, the aggregate amount set forth in the following table
for that month shall be increased or decreased, as the case may be, by
$250,000 multiplied by the amount by which the weighed average number of
Selected Sales Personnel which Priority has carried on its payroll for that
month exceeds or is less than 10. Such weighted average number of Selected
Sales Personnel shall be determined by adding the total number of Selected
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Sales Personnel employed by Priority on the first, last and fifteenth day
of each month and dividing by 3.
Month Minimum Monthly Production
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December $2,000,000
January $2,500,000
February and thereafter $2,500,000
JMCG and FTB acknowledge that FTB shall not be responsible to pay any
Monthly Subsidy with regard to any month after February, 1996 unless the
parties hereto agree on a later Termination Date in accordance with SECTION
2.1.1 hereof.
3.6 CUSTOMER COMPLAINTS. All Customer Complaints shall be handled as provided
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in SECTION 12.5 of the ISS Agreement. Nothing in this SECTION 3.6 or in SECTION
12.1 of the ISS Agreement is intended to modify the obligations of the parties
hereto under Sections 8.1 and 8.2 of the Mutual Fund Agreement or Sections 9.1
through 9.3 of the Services Agreement.
ARTICLE IV
JMCG REPRESENTATIONS AND WARRANTIES
JMC Group, Inc., for itself, Xxxxx Xxxxxxxx & Co. and Priority, and Xxxxx
Xxxxxxxx & Co. and Priority for themselves only, represent and warrant as
follows:
4.1 DUE ORGANIZATION. JMC Group, Inc., Xxxxx Xxxxxxxx & Co. and Priority are
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corporations, duly organized, validly existing and in good standing under the
laws of their respective states of incorporation and have all requisite
corporate power and authority to enter into this Agreement, to perform the
obligations hereunder and to consummate the transactions contemplated hereby.
4.2 DUE EXECUTION; LEGALLY BINDING. The execution, delivery and performance of
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this Agreement by JMC Group, Inc., Xxxxx Xxxxxxxx & Co. and Priority, and the
consummation by each of JMC Group, Inc., Xxxxx Xxxxxxxx & Co. and Priority of
the transactions contemplated hereby, have been duly authorized by all necessary
corporate action. This Agreement constitutes the legal, valid and binding
obligation of each of JMC Group, Inc., Xxxxx Xxxxxxxx & Co. and Priority
enforceable against each of JMC Group, Inc., Xxxxx Xxxxxxxx & Co. and Priority
in accordance with its terms, except as such enforceability may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium or other similar
laws affecting creditors' rights generally and except as the enforcement of
certain provisions may be limited by the application of general equitable
principles of law in certain circumstances (whether such provisions are
considered in a proceeding at law or in equity).
4.3 NO VIOLATION. The execution, delivery and performance of this Agreement
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and the consummation of the transactions contemplated hereby will not result in
a breach of any of the terms or provisions of, or constitute a default under, or
conflict with: (i) any agreement, indenture
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or other instrument to which JMC Group, Inc., Xxxxx Xxxxxxxx & Co. or Priority
is a party or by which it is bound; (ii) the charter or bylaws of JMC Group,
Inc., Xxxxx Xxxxxxxx & Co. or Priority; (iii) any judgment, decree, order or
award of any court, governmental body or arbitrator by which JMC Group, Inc.,
Xxxxx Xxxxxxxx & Co. or Priority is bound; or (iv) any law, rule or regulation
applicable to JMC Group, Inc., Xxxxx Xxxxxxxx & Co. or Priority.
4.4 NO ACTIONS. No Actions, are pending or threatened against, affecting or
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related to, JMC Group, Inc., Xxxxx Xxxxxxxx & Co. or Priority, in equity or
otherwise, which Actions would materially and adversely affect the ability of
JMC Group, Inc., Xxxxx Xxxxxxxx & Co. or Priority to perform its obligations
hereunder.
ARTICLE V
FTB REPRESENTATIONS AND WARRANTIES
FTB represents and warrants as follows:
5.1 DUE ORGANIZATION. FTB is a national banking association duly organized and
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validly existing under the laws of the United States. FTB, in its own capacity
and as Trustee, has all requisite corporate and trust power and authority to
enter into this Agreement, to perform its obligations hereunder and to perform
the obligations and covenants contemplated hereby.
5.2 DUE EXECUTION; LEGALLY BINDING. The execution, delivery and performance of
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this Agreement by FTB, in its own capacity and as Trustee, and the consummation
of the transactions contemplated hereby and thereby, have been duly authorized
by all necessary corporate action. This Agreement constitutes a legal, valid and
binding obligation of FTB, in its own capacity and as Trustee, enforceable
against it, in both capacities, in accordance with its terms, except as such
enforceability may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting creditors' rights
generally and except as the enforcement of certain provisions may be limited by
the application of general equitable principles of law in certain circumstances
(whether such provisions are considered in a proceeding at law or in equity).
5.3 NO VIOLATION. The execution, delivery and performance of this Agreement
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and the consummation of the transactions contemplated hereby will not result in
a breach of any of the terms or provisions of, or constitute a default under, or
conflict with: (i) any agreement, indenture or other instrument to which FTB is
a party or by which it is bound; (ii) the charter or bylaws of FTB; (iii) any
judgment, decree, order or award of any court, governmental body or arbitrator
by which FTB is bound; or (iv) any law, rule or regulation applicable to FTB as
a national bank.
5.4 NO ACTIONS. No Actions are pending or threatened against, affecting or
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related to, FTB, in equity or otherwise, which Actions would materially and
adversely affect the ability of FTB to perform its obligations hereunder.
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ARTICLE VI
MISCELLANEOUS
6.1 NOTICES. All notices, requests, demands and other communications hereunder
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shall be in writing and shall be deemed given, if delivered personally or sent
by telecopy with receipt confirmed, on the day given or, if mailed by certified
or registered mail, postage prepaid, return receipt requested, three days after
placement in the United States mail properly addressed to the addressees below:
If to JMCG:
0000 Xxxxxxxx Xxxx, Xxxxx 000
Xxx Xxxxx, XX 00000
Attn: Xxxxx Xxxxxxxx, President
Telecopy number: (000) 000-0000
If to FTB:
FIRST TENNESSEE BANK NATIONAL ASSOCIATION
000 Xxxxxxx Xxxxxx
Xxxxxxx, XX 00000
Attn: Xxx Xxxxxxx,
Vice President, Retail Sales Manager
Telecopy number: (000) 000-0000
6.2 GOVERNING LAW. This Agreement (including Exhibit A attached hereto), shall
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be governed by, and construed and enforced in accordance with, the laws of the
State of Tennessee without regard to principles of conflicts of law and the
forum for any legal action or proceeding hereunder shall be the State of
Tennessee.
6.3 INTEGRATION. This Agreement and the other Definitive Agreements contain
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the entire agreement between the parties hereto with respect to the transactions
contemplated hereby and thereby and supersede all previous oral and written
agreements, commitments and understandings and all contemporaneous oral
negotiations, commitments, writings and understandings relating to the
activities contemplated hereunder and thereunder. This Agreement may not be
modified, amended, altered or supplemented except upon the execution and
delivery of a written agreement executed by the parties hereto.
6.4 HEADINGS. The headings contained in this Agreement are for reference
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purposes only and shall not affect in any way the meaning or interpretation of
this Agreement.
6.5 ILLEGALITY. Any provision of this Agreement which is invalid, illegal or
-----------
unenforceable in any jurisdiction shall, as to that jurisdiction, be ineffective
to the extent of such invalidity, illegality or unenforceability, without
affecting in any way the remaining provisions hereof in
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such jurisdiction or rendering any other provision of this Agreement invalid,
illegal or unenforceable in any other jurisdiction.
6.6 ATTORNEY'S FEES. Except as provided in SECTION 6.7 hereof, in the event
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any legal action or proceeding is brought to enforce the terms of this
Agreement, the prevailing parties shall be entitled to reimbursement from the
other parties for all reasonable legal fees and court costs incurred with
respect to such action or proceeding.
6.7 ALTERNATIVE DISPUTE RESOLUTION.
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6.7.1 In the event of any dispute, claim or controversy which in any way
relates to, results from, or arises out of this Agreement, any amendment or
breach hereof or thereof, or any resulting transactions ("Dispute"), if the
Dispute cannot be settled through negotiation, the parties hereto agree to
first try in good faith to settle the Dispute by mediation under the
Commercial Mediation Rules of the American Arbitration Association, before
resorting to arbitration, as mandated below. Regardless of the outcome of
such mediation, each party shall bear its own costs, attorneys' fees and
share of mediation fees.
6.7.2 Thereafter, any remaining Dispute shall be decided by neutral
binding arbitration in accordance with the rules of the American
Arbitration Association and not by court action. Judgment upon the award
rendered by the arbitrator(s) may be entered in any court having
jurisdiction thereof; provided, however, that no arbitrator(s) shall be
permitted to award punitive damages in such arbitration proceeding.
Regardless of the outcome of such arbitration, each party shall bear its
own costs, attorneys' fees and share of arbitration fees.
6.8 EXPENSES. JMCG and FTB shall pay all expenses associated with the
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performance of their obligations hereunder.
6.9 COUNTERPARTS. This Agreement may be executed by the parties hereto in
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separate counterparts, each of which when so executed and delivered shall be an
original, but all of such counterparts shall together constitute one instrument.
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IN WITNESS WHEREOF, each of the parties hereto has caused this Agreement to be
signed as of the date first written above.
JMC GROUP, INC. FIRST TENNESSEE BANK NATIONAL
ASSOCIATION
By: /s/Xxxxx X. Xxxxxxxx By: /s/Xxxx Xxxxxxx
----------------------------- ---------------------------------
Its: President Its: Sr. Vice President
---------------------------- -------------------------------
XXXXX XXXXXXXX & CO. PRIORITY INVESTMENT SERVICES,
INC.
By: /s/Xxxxx X. Xxxxxxxx By: /s/Xxxxx X. Xxxxxxxx
----------------------------- --------------------------------
Its: President Its: President
---------------------------- -------------------------------
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EXHIBIT A
---------
CURRENT ANNUITY BLOCK PRODUCTS
PROVIDER COMPANY PRODUCT
----------------------------- ----------------------------------------------
Beneficial Standard Life Single Premium Whole Life
Insurance Company Single Premium Immediate Annuity
First Penn Pacific Life Single Premium Life
Insurance Company
Keyport Life Insurance Individual Deferred Annuity Flexible Payments
Company (FPDA (3))
Single Premium Immediate Annuity (SPIA)
Individual Variable Annuity Flexible Purchase
Payments (Flex (1) Variable Split Product and
Flex (4) Preferred Income Plan)
Single Premium Deferred Annuity (SPDA (3) and
SPDA (10))
Life Insurance Company of Flexible Premium Variable Deferred Annuity
Virginia Flexible Premium Variable Life
Flexible Premium Deferred Annuity
15