EXHIBIT 10.2
DATED 2004
RS GROUP OF COMPANIES, INC. (1)
AND
DASHWOOD, XXXXXX & XXXXXX LIMITED (2)
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BROKERAGE AGREEMENT
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[GRAPHIC OMITTED][GRAPHIC OMITTED]
00 Xxxxxxxxx
Xxxxxx
XX0X 0XX
Tel: 000 0000 0000
Fax: 000 0000 0000
Ref: JOG/GMT/0302012
INDEX
1. INTERPRETATION...................................................... 1
2. REPRESENTATIONS, WARRANTIES AND UNDERTAKINGS........................ 6
3. RSGC'S OBLIGATIONS.................................................. 6
4. COMMISSION.......................................................... 7
5. GROSS PREMIUMS...................................................... 8
6. INTRODUCED BROKERS.................................................. 9
7. TERMINATION........................................................ 10
8. DATA PROTECTION.................................................... 11
9. CONFIDENTIALITY.................................................... 12
10. ASSIGNMENT......................................................... 13
11. VARIATION.......................................................... 13
12. ANNOUNCEMENTS...................................................... 13
13. COSTS.............................................................. 14
14. AGREEMENT NOT A PARTNERSHIP........................................ 14
15. GENERAL............................................................ 14
16. COUNTERPARTS....................................................... 15
17. NOTICES............................................................ 15
18. ENGLISH LAW........................................................ 17
SCHEDULE................................................................. 18
EXISTING AGENTS.......................................................... 18
THIS AGREEMENT is made on 2004
BETWEEN:
(1) RS GROUP OF COMPANIES, INC. (a company incorporated in the State of
Florida, U.S.A.) whose corporate address is 000 Xxxxxxxx Xxxx., Xxxxx
000, Xxxxxxx, Xxxxxxx, X0X 0X0 ("RSGC"); and
(2) DASHWOOD, XXXXXX & XXXXXX LIMITED (registered in England and Wales No.
687923) whose registered office is at Xxxxxxxxxxx Xxxxx, 0 Xxxxxx
Xxxxxx, Xxxxxx X0 0XX ("DBP").
BACKGROUND:
(A) RSGC is a company whose shares are listed in New York on the
Over-the-Counter Bulletin Board, which offers RSGC's Products as part
of an affinity programme, via CIL, its subsidiary, and VGV, its
business partner.
(B) DBP is a placing broker.
(C) RSGC hereby appoints DBP, as its broker of choice, to place the
insurance business in relation to RSGC's Products with Insurers,
subject to the terms of this Agreement, and agrees to allow DBP
Commission as remuneration for such services on the terms of this
Agreement.
(D) In addition to the Commission, Escrow Commission shall be payable into
the Escrow Account.
IT IS AGREED as follows:
1. INTERPRETATION
1.1 In this Agreement, unless the context otherwise requires, the following
expressions shall have the following meanings:
"APPLICABLE REGULATIONS" all statutory and other laws, rules,
regulations and provisions from time to
time in force relating to the subject
matter of or having an impact on this
Agreement, including (without limitation)
the Financial Services and Markets Xxx
0000, the DPA, and the rules, codes of
conduct, codes of practice, practice
requirements and accreditation terms
stipulated by any regulatory authority or
body (including the FSA, the GISC and
Lloyd's);
"BUSINESS DAY" a day other than a Saturday or Sunday or
public holiday in England and Wales;
"CIL" Canadian Intermediaries Limited (a company
incorporated in Canada, under The Canada
Business Corporations Act), which is a
subsidiary of RSGC;
"COMMISSION" the commission allowed to DBP pursuant to
clause 4.1;
"CONFIDENTIAL INFORMATION" information (however stored) relating to
or connected with the business, products
services, clients, customers, suppliers or
financial or other affairs of a party to
this Agreement, including information
concerning or relating to RSGC's Products,
Insureds, Insurers, Gross Premiums,
intellectual property, any technical
process, or the marketing of goods or
services and any other matters concerning
the clients, customers or suppliers of, or
other persons having dealings with, such
party;
2
"DPA" the Data Protection Xxx 0000;
"ESCROW ACCOUNT" the bank account to be opened in
the joint names of RSGC and DBP with
Natwest Bank plc, 00 Xxxxxxxxxxx, Xxxxxx
XX0X 0XX (or such other account as the
parties may from time to time designate);
"ESCROW COMMISSION" the commission allowed to RSGC and
credited to the Escrow Account pursuant to
clause 4.2;
"ESCROW TERMS" the joint bank mandate between RSGC and
DBP in relation to the Escrow Account;
"EXISTING AGENTS" those intermediaries who, as at
the date of this Agreement, place the
insurance business in relation to RSGC's
Products on behalf of RSGC, as set out in
the Schedule;
"FSA" the Financial Services Authority (or any
successor to it);
"GISC" the General Insurance Standards Council (a
company limited by guarantee and
registered in England and Wales under
number 3705388) (or any successor to it);
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"GROSS PREMIUMS" the gross premiums in respect of RSGC's
Products payable by, or on behalf of,
Insureds, to Insurers;
"INSUREDS" persons whose risks are insured under
RSGC's Products;
"INSURERS" those insurers (including syndicates at
Lloyd's) with which DBP places the
insurance business in relation to RSGC's
Products;
"INTRODUCED BROKERS" the brokers introduced by RSGC to DBP
pursuant to clause 6.1;
"INTRODUCTORY COMMISSION" the commission payable by DBP into the
Escrow Account pursuant to clause 6.3;
"LLOYD'S" Lloyd's of London; and
"RSGC GROUP" RSGC, any subsidiary or subsidiary
undertaking of RSGC, any holding company
of RSGC and any subsidiary or subsidiary
undertaking of any such holding company,
from time to time;
"RSGC'S PRODUCTS" RSGC's Products offered by CIL, VGV, or
any member of the RSGC Group in relation
to which DBP places the insurance business
with Insurers, including rent guarantee
insurance, F.A.C.T., mortgage indemnity
insurance, time-share value guarantee
protection, utility underwriting - Toronto
Hydro and Xxxxxxxx Hydro, and such other
RSGC's Products as the parties may, from
time to time, agree; and
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"VGV" Value Guaranteed Vacations Inc. (a company
incorporated in the State of Florida,
USA), which is a business partner of RSGC.
1.2 Unless otherwise stated, references in this Agreement to clauses and
the Schedule are to clauses of and the Schedule to this Agreement and
references to this Agreement include the Schedule.
1.3 In this Agreement:
(a) where the context admits, words and phrases the definitions of
which are contained or referred to in Part XXVI of the
Companies Xxx 0000 shall be construed as having the meanings
thereby attributed to them;
(b) any phrase introduced by the terms "including", "include", "in
particular" or any similar expression shall be construed as
illustrative and shall not limit the terms of the words
preceding those terms; and
(c) words importing the singular include the plural, and vice
versa, words importing any gender include every gender and
references to persons include bodies corporate, unincorporated
associations and partnerships.
1.4 All references in this Agreement to time shall be to U.K. time.
1.5 References in this Agreement to statutory provisions shall be construed
as references to those provisions as respectively replaced, amended or
re-enacted or as their application is modified by other provisions from
time to time (whether before or after the date of this Agreement) and
shall include any provisions of which they are re-enactments (whether
with or without modification) and any subordinate legislation made
under such provisions, save that no party shall have any liability
under this Agreement for any such replacements, amendments,
re-enactments or modifications having retrospective effect.
1.6 The Interpretation Act 1978 shall apply to this Agreement in the same
way as it applies to an enactment.
1.7 The headings to the clauses are for convenience only and have no legal
effect.
2. REPRESENTATIONS, WARRANTIES AND UNDERTAKINGS
Each party represents, warrants and undertakes to the other that:
(a) it has full power and authority and has taken all action
necessary to enter into and perform this Agreement;
(b) its obligations under this Agreement are valid and binding
obligations enforceable in accordance with their terms; and
(c) it has complied, and will comply during the period of this
Agreement, with all Applicable Regulations in relation to this
Agreement and the performance of its obligations hereunder.
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3. RSGC'S OBLIGATIONS
3.1 Subject to clause 3.2, RSGC shall use its best endeavours, and shall
procure that VGV, CIL and each relevant member of the RSGC Group shall
use its best endeavours, to provide DBP with the opportunity to place
the insurance business in relation to RSGC's Products and Insurers.
3.2 RSGC shall not, and shall procure that neither VGV, CIL and each
relevant member of the RSGC Group shall not, provide any person other
than DBP with the opportunity to place the insurance business in
relation to RSGC's Products, unless:
(a) such person is an Existing Agent;
(b) DBP has previously refused in writing the opportunity to place
the insurance business with Insurers; or
(c) DBP has failed to place the insurance business within 20
Business Days of being first requested by RSGC, VGV, CIL or
another member of the RSGC Group to place it, except in the
case of insurance business which the parties agree is complex,
in which case DBP shall have 60 Business Days in which to
place such insurance business.
3.3 RSGC shall, and shall procure that VGV, CIL and each relevant member of
the RSGC Group shall, immediately inform DBP of any material
information that it receives in relation to any Insured or to RSGC's
Products.
4. COMMISSION
4.1 Subject to clause 4.3, RSGC and DBP agree that, in respect of the
insurance business in relation to RSGC's Products which DBP places with
Insurers, commission of 2.5% of the Gross Premiums in respect of such
insurance business shall be paid to DBP for its own account (the
"COMMISSION").
4.2 Subject to clause 4.3, RSGC and DBP agree that, in respect of the
insurance business in relation to RSGC's Products which DBP places with
Insurers, commission of 2.5% of the Gross Premiums in respect of such
insurance business shall be paid to the Escrow Account, for the account
of RSGC (the "ESCROW COMMISSION").
4.3 RSGC and DBP agree that upon whichever is the earlier of the money paid
into the Escrow Account reaching (pound)1,475,450 (whether as a result
of Escrow Commission or Introductory Commission being paid into the
Escrow Account or RSGC paying money directly into the Escrow Account)
and 31 December 2004, the Escrow Commission shall no longer be payable
and the commission payable to DBP as Commission shall immediately
increase to 5%.
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4.4 If any of the Gross Premiums are refunded by an Insurer to an Insured
for any reason, DBP shall pay to the relevant Insurer a refund of
Commission which shall bear the same proportion to the total Commission
which was originally payable in respect of such Gross Premiums as the
amount of the Gross Premiums which is refunded bears to the total Gross
Premiums originally payable. The parties shall also procure that, if
Escrow Commission was payable in respect of such Gross Premiums, a
refund of Escrow Commission shall be paid to the relevant Insurer from
the Escrow Account which shall bear the same proportion to the Escrow
Commission which was originally payable in respect of such Gross
Premiums as the amount of the Gross Premiums which is refunded bears to
the total Gross Premiums originally payable, provided that if it is not
possible to make such refund from the Escrow Account (whether due to
there being insufficient funds credited to the Escrow Account or
otherwise), RSGC alone shall be liable to make such refund.
4.5 All payments to be made under this clause shall be made within 10
Business Days of the end of each month.
5. GROSS PREMIUMS
5.1 RSGC shall procure that VGV and CIL shall collect all Gross Premiums
from Insureds and shall remit such Gross Premiums to DBP.
5.2 DBP agrees to pay to Insurers all Gross Premiums which it receives
pursuant to clause 5.1, minus:
(a) all Commission and Escrow Commission which is payable in respect of
such Gross Premiums pursuant to clauses 4.1 and 4.2; and
(b) any taxes or other deductions required by law or regulatory
requirement.
5.3 DBP shall maintain a complete and accurate record of:
(a) the Gross Premiums, Commission and Escrow Commission payable
in respect of each of RSGC's Products in relation to which it
places the insurance business;
(b) the relevant details of each Insured; and
(c) the relevant details of each Insurer with which DBP places the
insurance business in relation to RSGC's Products,
and shall ensure that such records are available, at reasonable times
and upon reasonable notice, for inspection by an authorised officer of
RSGC or by representatives of the FSA, GISC or Lloyd's.
5.4 DBP shall send RSGC a bordereaux showing each of the matters set out in
clause 5.3 within 20 Business Days of the end of each month.
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6. INTRODUCED BROKERS
6.1 RSGC may introduce brokers to DBP, as potential employees or
consultants of DBP ("INTRODUCED BROKERS").
6.2 Nothing shall oblige DBP to enter into any agreement with any
Introduced Brokers or shall affect the terms upon which it may contract
with any of them.
6.3 Subject to clause 6.4, where DBP employs, or enters into any contract
for services with, any Introduced Brokers during the period ending 31
December 2004, DBP shall pay commission into the Escrow Account
("INTRODUCTORY Commission"), which shall be calculated on the following
basis:
0.15 x Net Profit
Where "NET PROFIT" is all income, fees, brokerage, commission and other
remuneration generated for DBP by the relevant Introduced Brokers minus
all losses, costs, charges, attributable overheads, remuneration and
expenses incurred by DBP as a result of or which are in any way
attributable to the employment or engagement of the Introduced Brokers,
before any adjustment for taxation and excluding any extraordinary
items, for the period ending 31 December 2004, as calculated in
accordance with the accounting principles applied in respect of DBP's
audited accounts for the financial year ending on 30 June 2004.
6.4 Subject to the operation of clause 6.3, DBP shall prepare a draft
unaudited Net Profit statement in relation to the Introduced Brokers
and send a copy of such draft statement to RSGC within one month of 31
December 2004. The parties shall then seek to agree a final version of
the Net Profit statement within two weeks of the date upon which DBP
produces the draft. If the parties are unable to agree a final version,
or to do so within this timescale, the matter shall be settled by DBP's
auditors, who shall act as experts and not as arbitrators, whose
decision shall (save in the case of manifest error) be binding on the
parties and who shall decide which of the parties shall bear their
costs and in what proportions.
6.5 The Introductory Commission shall cease to be payable as soon as the
amount of money which has been paid into the Escrow Account reaches
(pound)1,475,450 (whether as a result of Commission or Introductory
Commission being paid into the Escrow Account or as a result of RSGC
making payments into the Escrow Account) or 31 December 2004, whichever
is the earlier.
7. TERMINATION
7.1 DBP shall have the right to terminate this Agreement forthwith by
notice in writing to RSGC if RSGC is in breach of any of its
obligations under clause 3.
7.2 Either party may terminate this Agreement forthwith if the other party
commits a serious breach of the terms of this Agreement which, if
capable of being remedied, such other party has failed to remedy within
60 Business Days of being notified in writing of such breach by the
party wishing to terminate this Agreement.
8
7.3 Except where specifically stated otherwise herein, on any termination
of this Agreement all obligations and liabilities of the parties
accrued to the date of such termination shall continue in force until
fully discharged and all accounts between the parties have been finally
settled.
8. DATA PROTECTION
8.1 Subject to clause 8.2, each party warrants and undertakes (both on its
own behalf and, in the case of RSGC, on behalf of VGV, CIL and each
relevant member of the RSGC Group) that:
(a) it will maintain all necessary registrations in relation to
data protection and the processing of personal data
(including, if required, an appropriate registration as a data
controller under the DPA) during the period of this Agreement;
(b) in relation to any personal data processed on behalf of the
other party it will act only on the instructions of the other
party and will ensure that appropriate technical and
organisational measures are taken against unauthorised or
unlawful processing of such personal data and against
accidental or unlawful destruction, or accidental loss,
alteration, unauthorised disclosure of, or access to, such
personal data;
(c) any personal data which it discloses or transfers to the other
party shall not be subject to any prohibition or restriction
which restricts or affects the ability of the other party to
disclose or transfer that personal data to any third party or
of the other party to use that personal data for any
reasonable purpose in connection with this Agreement
(including the disclosure or transfer of such personal data by
the other party for the purpose of claims administration,
checking credit references, cross-selling RSGC's Products or
the prevention of fraud, or to any party which is providing
underwriting capacity to it) and, in particular, that the
party disclosing or transferring such personal data has
obtained all necessary consents from data subjects in relation
to the use of such personal data, and that any such disclosure
or transfer will not give rise to any breach of any provision
of the DPA, any duty of confidentiality, any intellectual
property rights of a third party or any contractual
obligation; and
(d) it will comply with all relevant provisions of the DPA in
relation to the processing of data relating to actual and
potential Insureds and RSGC's Products.
8.2 Nothing in clause 8.1 shall require any act or omission of any party
which would constitute a breach of any Applicable Regulations.
9. CONFIDENTIALITY
9.1 Each of the parties hereby undertakes with the other that it shall not
at any time after the date of this Agreement (including after the
termination of this Agreement) use or disclose to any person any
Confidential Information relating to the other party and shall use all
reasonable endeavours to prevent the use or disclosure of such
Confidential Information.
9
9.2 This clause shall not prevent disclosure of Confidential Information by
a party:
(a) to a director, officer or employee of it acting in the proper
course of his duties and whose function requires him to have
the Confidential Information;
(b) where it is required to be disclosed by law or by any
regulatory authority, tax authority or recognised stock
exchange and provided that the party required to disclose such
Confidential Information shall, where practicable and unless
prohibited from doing so by law or by any regulatory
authority, tax authority or recognised stock exchange, first
consult with and take into account the reasonable requirements
of the other party in connection with the required disclosure;
(c) to one of its advisers for the purpose of advising a party but
only on terms that clause 9.1 applies (as modified by clause
9.2) to the use or disclosure by the adviser; or
(d) which has become publicly known except as a result of that
party's breach of clauses 9.1 or 9.2.
10. ASSIGNMENT
A party may not assign, transfer or sub-contract or purport to assign,
transfer or sub-contract (whether at law or in equity) a right or
obligation under this Agreement without the prior written consent of
the other party, such consent not to be unreasonably withheld.
11. VARIATION
No variation of this Agreement shall be effective unless it is in
writing and signed by or on behalf of the parties to this Agreement.
12. ANNOUNCEMENTS
12.1 Subject to clause 12.2, no announcement, disclosure, communication or
publicity of any kind shall be made or issued by either party to this
Agreement relating to the subject matter or terms of this Agreement
without the prior written approval of the other party (such approval
not to be unreasonably withheld or delayed).
12.2 Clause 12.1 shall not apply to any announcement, disclosure,
communication or publicity required by law, any regulatory authority,
tax authority or any recognised stock exchange or by any rule or
regulation of the FSA, GISC or of Lloyd's, provided that the party
required to make or issue it has so far as reasonably practicable
consulted with and taken into account the reasonable requirements of
the other party as to the timing, contents and manner of making or
issuing any such announcement.
13. COSTS
Each party shall pay its own costs relating to the negotiation,
preparation, execution and performance of this Agreement and of each
document referred to in it.
10
14. AGREEMENT NOT A PARTNERSHIP
No provision of this Agreement shall create a partnership between the
parties to this Agreement.
15. GENERAL
15.1 This Agreement shall be binding on and shall enure for the benefit of
the permitted assigns of the parties to this Agreement.
15.2 No neglect, delay or indulgence on the part of any party in enforcing
any term of this Agreement will be construed as a waiver and no single
or partial exercise by any party of any rights or remedy under this
Agreement will preclude or restrict the further exercise or enforcement
of any such right or remedy.
15.3 Any waiver of any breach of any provision of this Agreement shall not,
unless the terms of the waiver expressly provides otherwise, be
construed as a waiver of any continuing or subsequent breach of such
provision or a modification of that provision.
15.4 If any term or provision of this Agreement is held to be illegal or
unenforceable, in whole or in part, under any enactment, regulation or
rule of law, that term or provision shall to that extent be deemed not
to form part of this Agreement but the enforceability of the remainder
of this Agreement shall not be affected.
15.5 This Agreement and the Escrow Terms constitute the entire agreement and
understanding between the parties to this Agreement with respect to the
subject matter contained in this Agreement and all other agreements
between the parties relating thereto shall forthwith cease and
determine and neither party shall have any liability to the other in
respect thereof. Each party acknowledges that, in agreeing to enter
into this Agreement, it has not relied on any representation, warranty,
collateral contract or other assurance made by or on behalf of the
other party on or before signature of this Agreement. Each party waives
all rights and remedies (whether in contract or tort, under statute or
otherwise) which, but for this clause, might otherwise be available to
it in respect of any such representation, warranty, collateral contract
or other assurance, provided that nothing in this clause shall limit or
restrict any liability for fraud.
15.6 A person who is not a party to this Agreement has no right under the
Contracts (Rights of Third Parties) Xxx 0000 to benefit from or enforce
any term of this Agreement but this does not affect any right or remedy
of a third party which exists or is available apart from that Act.
16. COUNTERPARTS
This Agreement may be executed in any number of counterparts each of
which when executed shall be an original but all the counterparts shall
together constitute one and the same instrument.
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17. NOTICES
17.1 Any notice to be given under this Agreement shall be in writing and
shall be delivered personally or sent by air-mail or by fax:
(a) In the case of RSGC to:
000 Xxxxxxxx Xxxxxxxxx, Xxxxx 000, Xxxxxxx, Xxxxxx X0X 0X0
Fax No: (x000) 000 000 0000
Marked for the attention of: Xxxxxx Xxxxx
(b) In the case of DBP to:
Xxxxxxxxxxx Xxxxx, 0 Xxxxxx Xxxxxx, Xxxxxx X0 0XX
Fax No: (+44) (0)000 000 0000
Marked for the attention of: Xxxxxxx Xxxxxxx
or as otherwise notified by them from time to time (in accordance with
the provisions of this clause).
17.2 In the absence of evidence of earlier receipt, a notice or other
communication is deemed given:
(a) if delivered personally, when left at the address referred to
in clause 17.1;
(b) if sent by air-mail, on the third Business Day next following
the day of posting it; and
(c) if sent by fax, on completion of its transmission if
transmitted during normal business hours (9.30 a.m. to 5.30
p.m.) on any Business Day. A notice given by a fax transmitted
after midnight but on or before 9.30 a.m. on any Business Day
shall be deemed to be given at 9.30 a.m. on that Business Day
and a notice given by a fax transmitted after 5.30 p.m. but on
or before midnight on any Business Day shall be deemed to be
given at 9.30 a.m. on the following Business Day.
17.3 In proving the giving of a notice it shall be sufficient to prove that
the notice was left or that the envelope containing such notice was
properly addressed and posted or that the fax was transmitted.
18. ENGLISH LAW
18.1 This Agreement shall be governed by and construed in accordance with
the laws of England.
18.2 The parties hereby submit for all purposes connected with this
Agreement to the exclusive jurisdiction of the High Court of Justice in
England and Wales.
18.3 RSGC irrevocably appoints Xxxxxxx Xxxxxx of Xxxxxx Xxxx Xxxx,
Xxxxxxxxx, Xxxx Xxxxxx, XX00 0XX (fax number 00000 000 000) as its
agent to receive on its behalf in England service of any proceedings
arising out of or in connection with this Agreement. Such service shall
be deemed completed on delivery to such agent (whether or not it is
forwarded to and received by RSGC. If for any reason such agent ceases
to be able to act as agent or no longer has an address in England, RSGC
irrevocably agrees that within 10 Business Days it shall appoint a
substitute agent acceptable to DBP with an address in England and
deliver to DBP a copy of the new agent's acceptance of that
appointment, together with its name, address and fax number. Nothing
contained in this Agreement shall affect the right to serve process in
any other manner permitted by law.
IN WITNESS of which the authorised representatives of the parties have signed
this Agreement on the date first written above.
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SCHEDULE
EXISTING AGENTS
NAME TYPE OF INSURANCE PRODUCT
---- -------------------------
Tysers International Insurance and o Canadian Liability
Reinsurance Brokers o Mortgage Indemnity Insurance
SIGNED by )
for and on behalf of )
RS GROUP OF COMPANIES, INC. )
SIGNED by )
for and on behalf of DASHWOOD )
XXXXXX & XXXXXX LIMITED )
