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EXHIBIT 10.1
THIRD AMENDMENT AND JOINDER TO THE
DIRECTED REINSURANCE AGREEMENT
THIS THIRD AMENDMENT AND JOINDER to the Directed Reinsurance Agreement
effective June 8, 1998 (the "Agreement") between World Marketing Alliance, Inc.
("Agency") and The WMA Corporation ("WMAC") is entered into by and among Agency,
WMAC and World Financial Group, Inc. ("WFG") as of the 12th day of July, 2001.
WHEREAS, WFG, a wholly-owned subsidiary of AEGON Asset Management
Services, Inc. ("AEGON"), has acquired certain assets of Agency (the
"Acquisition");
WHEREAS, as a part of the Acquisition, Agency has agreed to assign to
WFG, and WFG agreed to assume, the obligations arising on or after the Effective
Date, as defined below, of Agency pursuant to the Agreement provided the parties
entered into this Amendment as set forth below;
WHEREAS, WFG has requested that WMAC consent to such assignment and
agree to amend the terms of the Agreement as set forth herein;
WHEREAS, WMAC is willing to consent to such assignment and amend the
Agreement as set forth herein;
NOW, THEREFORE, WMAC, Agency and WFG do hereby agree to amend the terms
and conditions of the Agreement as follows:
1. The term "Insurance Companies" as used herein shall hereafter
mean those life insurance companies with whom Agency has
selling agreements other than those life insurance companies
included in the definition of "WRL Companies" in the First
Right Agreement between WMAC and Western Reserve Life
Assurance Co. of Ohio of even date herewith (the "First Right
Agreement"). The term "Ceding Insurance Companies" as used
herein shall hereafter mean those Insurance Companies with
whom WMAC has reinsurance agreements in force.
2. Paragraph 1 of the Agreement is hereby deleted in its entirety
and the following new language is substituted therefore:
1. Agency Obligations. During the term of this
Agreement, subject to the limitations set forth in
Paragraph 3 hereof, Agency shall:
(a) notify WMAC of Agency's intent to engage in
any selling efforts relating to any
Insurance Company Products not sold by
Agency as of the Effective Date (as defined
below). Such notification shall be in
writing and accompanied by a description of
the specifications for such Products and the
name and contact information of the
Insurance Companies for such Products.
Agency shall not engage in selling efforts
for such Products for at least sixty (60)
days after delivering all of such
information to WMAC, in order to allow WMAC
the opportunity to provide to such Insurance
Companies for such Products the terms and
conditions of reinsurance upon which WMAC
desires
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to reinsure such Products;
(b) notify WMAC of Agency's intent to enter into
a selling agreement with an Insurance
Company. Such notification shall be in
writing and accompanied by a description of
the specifications for the Products to be
covered by such selling agreement and the
name and contact information of the
Insurance Company. Agency shall not execute
any selling agreement for at least ninety
(90) days after delivering all of such
information to WMAC, in order to allow WMAC
the opportunity to provide the terms and
conditions of reinsurance which WMAC desires
to include in such selling agreement,
including without limitation, a provision
requiring that the Insurance Company provide
to WMAC an opportunity to propose terms of
reinsurance on all Products to be issued by
the Insurance Company and written by the
Agency;
(c) at the option of WMAC, use its Best Efforts
to assist WMAC in attaining the opportunity
to reinsure all Insurance Company Products
sold by the Agents on terms acceptable to
WMAC, provided such reinsurance terms shall
not require Agency, without Agency's
consent, to accept commission rates less
than the rates otherwise available on such
Products, solely as a result of the
reinsurance terms. Such assistance shall
include, but not be limited to, providing:
(1) certain benefits to the Ceding Insurance
Companies not otherwise available to
Insurance Companies such as access to
certain Agency information, which
information shall be at Agency's
determination, which may include, for
example, the Ceding Insurance Company market
share data of business sold through Agency,
locations of field offices, field force
contacts and phone numbers, and field force
commission schedules, (2) the greater of (i)
50% more stage time than Insurance
Companies', not to exceed the WRL Companies'
allowed stage time, or (ii) WRL Companies'
allowed time at Agency Sponsored Events, and
(3) opportunity to participate in Agency
sponsored product provider field
communication mediums, which mediums shall
be at Agency's determination, which may
include, for example, mailings, group
electronic messages, conference calls and
televised broadcasts. The determination of
providing such assistance shall take into
account the best interest of the
policyholders, agents and Agency;
(d) use its Best Efforts to cooperate with WMAC
in its negotiations with the Insurance
Companies to enter into reinsurance
agreements; and
(e) use its Best Efforts from time to time in
the course of the performance of this
Agreement to advise Agency officers and
employees who need to know the provisions of
this Agreement in order to carry out Agency
obligations hereunder.
For purposes of this Agreement, as used herein, "Best Efforts"
shall mean best commercially reasonable efforts and "Agency
Sponsored Events" shall mean any marketing event sponsored by
Agency upon which two (2) or more WRL Companies or Insurance
Companies are invited to participate. Agency agrees that,
during the term of
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this Agreement, it shall not enter into agreements containing
provisions similar to those contained herein, with any other
party. Further, subsections (a) and (b) above shall not apply
to situations where Agency offers a Product or enters into a
selling agreement with a Insurance Company so that an Agent
who transfers his licenses and customers to Agency may receive
trail commissions for Products sold to such customers before
transferring to Agency; provided that subsections (a) and (b)
shall apply to new sales.
3. Paragraph 9 is hereby amended by adding the following address
for WFG:
World Financial Group, Inc.
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: President
4. Paragraph 11 is hereby amended by adding the following to the
end of this section.
"Agency hereby assigns its rights and obligations
under this Agreement to WFG and from and after the
date hereof (the "Effective Date"), WFG hereby
expressly assumes all of Agency's obligations arising
on or after the Effective Date under this Agreement,
as amended, and agrees to be bound by its terms. From
and after the Effective Date, WFG shall be deemed to
be "Agency" hereunder."
5. All other terms and conditions of the Agreement shall remain
unchanged.
WFG hereby joins, and agrees from and after the Effective Date to be bound by
all of the terms and conditions of, the Agreement, as previously and hereby
amended, on the same basis as if WFG were "Agency" thereunder.
IN WITNESS WHEREOF, this Third Amendment is executed on behalf of the
parties by their duly authorized representatives on the date first mentioned
above.
WORLD MARKETING ALLIANCE, INC. THE WMA CORPORATION
By: /s/ S. ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, Jr. By /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇
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Title: Chief Executive Officer Title: President & CFO
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WORLD FINANCIAL GROUP, INC.
By: /s/ ▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇
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Title: President
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