EXHIBIT 10.3
MARKETING AGREEMENT
This Marketing Agreement is made and entered into and effective as of January
18, 2001, by and between the parties as follows:
Xxxx Xxxxxxx Life Insurance Company ("Xxxxxxx"), a Massachusetts corporation,
and Legacy Marketing Group ("LMG"), a California corporation, based on the
following facts:
A. Concurrently herewith, LMG and Xxxxxxx are entering into a certain
Administrative Services Agreement pursuant to which certain insurance
business is to be administered by LMG.
B. The objective of this Agreement is to provide an arrangement to sell
certain policies ("Policies") of Xxxxxxx as specified in APPENDIX X.
X. Xxxxxxx desires to have LMG recruit, train, and appoint Wholesalers and
Producers in the sale of certain Policies issued by Xxxxxxx as specified in
APPENDIX A. Wholesalers and Producers are those licensed insurance agents
contracted with LMG and appointed to sell Xxxxxxx products.
Based on the foregoing facts, LMG and Xxxxxxx ("the parties") agree as follows:
1. DESIGNATION OF LMG AND SCOPE OF LMG'S AUTHORITY
1.1 Xxxxxxx designates LMG to recruit, train, and appoint Wholesalers and
Producers in the solicitation of the Policies in the geographic
territory specified in APPENDIX A (the "Territory").
1.2 LMG is designated by Xxxxxxx for the purpose of soliciting
applications for and processing the Policies referenced in APPENDIX A
and otherwise transacting the business of this Agreement. LMG accepts
such designation and agrees to comply with all applicable laws and
regulations, and to diligently devote itself to the business of this
designation in order to support sales of the Policies referenced in
APPENDIX A as well as help prevent the termination of such Policies
through conservation procedures mutually agreed upon by Xxxxxxx and
LMG.
1.3 LMG shall cause each new Wholesaler and Producer to enter into
Wholesaler and Producer Agreements in the form shown in APPENDIX X.
Xxxxxxx will not be a party to the Wholesaler and Producer agreements
and shall have no obligation or liability thereunder. If such
Wholesaler or Producer Agreement is modified by LMG, LMG will provide
Xxxxxxx with copies, within ten (10) business days of such
modifications for the purpose of granting Xxxxxxx an opportunity to
reject such modifications. LMG's modifications to the Wholesaler and
Producer agreements will be deemed to have been ratified by Xxxxxxx
absent its written objection, as hereafter required. Xxxxxxx will
forward any objections to such modifications in writing to LMG within
(10) business days of its notice. LMG shall file appointments of
Wholesalers and Producers in the appropriate states' insurance
departments and other jurisdictions. LMG will report weekly to Xxxxxxx
a list of current appointments, adding new appointments and
terminations from the list each week. Consideration for processing
such appointments and terminations is provided for in the
Administrative Services Agreement, executed concurrently herewith this
Marketing Agreement.
1.4 It is understood and agreed that LMG is an independent contractor and
nothing herein shall be construed to create the relationship of
employer or employee between Xxxxxxx and LMG or between Xxxxxxx and
any officer, employee, Wholesaler, Producer or other associated person
of LMG. Neither LMG nor any Wholesaler or Producer has authority to
incur any liability on behalf of or to bind Xxxxxxx in any way or
change its rights, duties, or obligations, except as may be set forth
in the Administrative Services Agreement between Xxxxxxx and LMG,
executed concurrently herewith.
1.5 All Wholesalers and Producers who have been recruited and are
appointed to sell the Policies referenced in APPENDIX A by LMG shall
be identified by Xxxxxxx as Wholesalers and Producers of LMG as to
such Policies. Any and all contracts entered into by and between such
Wholesalers or Producers with respect to such Policies shall be coded
by LMG onto its system and deemed Wholesalers and Producers of LMG.
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Xxxxxxx may terminate Xxxxxxx'x appointment of any Wholesaler or
Producer, with cause, at its reasonable discretion, with prior written
notice to LMG. Xxxxxxx may terminate Xxxxxxx'x appointment of any
Wholesaler or Producer, without cause, by mutual written agreement of
LMG. Xxxxxxx may not otherwise terminate, recode, or otherwise disturb
the relationship between LMG and its Wholesalers and Producers with
respect the Polices without the prior written consent of LMG.
2. RIGHTS AND OBLIGATIONS OF XXXXXXX
2.1 It is acknowledged by both Xxxxxxx and LMG that certain obligations of
Xxxxxxx hereunder are to be performed by LMG as a servicing
organization, pursuant to the Administrative Services Agreement
between Xxxxxxx and LMG. This does not relieve Xxxxxxx of any of its
duties and obligations unless the specific service is provided for in
the Administrative Services Agreement, executed concurrently herewith,
or in this Marketing Agreement, whereby LMG has explicitly
acknowledged the responsibility of the service.
2.2 APPENDIX B will provide for the compensation payable to LMG from
Xxxxxxx. APPENDIX B will be amended to conform with each new product
specification as it is developed and finalized. The marketing
allowance and commissions may vary with the development of each new
product. Such marketing allowance will be specifically provided for in
APPENDIX B, or any subsequent amendments pertaining to new products.
2.3 The commissions specified in APPENDIX B shall be modified whenever
necessary to conform to the legal requirements of any state.
Furthermore, Xxxxxxx reserves the right to withdraw its Policies from
any state or other jurisdiction, with 60 days written notice to LMG,
unless otherwise mutually agreed upon in writing, or unless mandated
by any law, regulation, regulatory authority or court of law to do so
sooner.
2.4 Xxxxxxx shall have sole authority and responsibility for filing
advertising materials, pertaining to the business underwritten by
Xxxxxxx, with applicable regulatory authorities prior to approving
their use by LMG. All costs associated with such filings will be the
responsibility of Xxxxxxx, unless the parties agree otherwise in
writing.
2.5 (a) Agent Initial Appointment Fees--Unless mutually agreed upon in
writing otherwise, Xxxxxxx shall be responsible for payment of LMG's
Wholesaler and Producer resident initial appointment fees for such
Wholesalers and Producers who have satisfied LMG's and Xxxxxxx'x
agreed upon selection and compliance criteria. Unless mutually agreed
upon in writing otherwise, Xxxxxxx will be responsible for any
Wholesaler and Producer non-resident initial appointment fees. Such
non-resident appointment requirements will comply with Xxxxxxx'x
policies and procedures in effect as of the execution of this
Agreement. If Xxxxxxx changes such policies and procedures, the
responsibility for payment of such non-resident initial appointment
fees will be mutually agreed in writing by both LMG and Xxxxxxx.
(b) Agent Renewal Appointment Fees--Xxxxxxx will be responsible for
payment of LMG's Wholesaler and Producer resident and non-resident
renewal appointment fees for contracted Wholesalers and Producers.
Such non-resident appointment requirements will comply with Xxxxxxx'x
policies and procedures in effect as of the execution of this
Agreement. If Xxxxxxx changes such policies and procedures, the
responsibility for payment of such non-resident renewal appointment
fees will be mutually agreed in writing by both LMG and Xxxxxxx.
(c) Agent Termination Fees--Xxxxxxx will be responsible for LMG's
Wholesaler and Producer Appointment termination fees in the states
which mandate such fees.
2.6 Xxxxxxx shall provide LMG with prompt written notice of any change of
authority of persons authorized and enumerated in APPENDIX D to
provide LMG with instructions or directions relating to services to be
performed by LMG under this Agreement. In the absence of timely notice
and LMG relies to its detriment on instructions or directions from one
who is no longer authorized but otherwise acting within the scope of
his authority, Xxxxxxx will indemnify LMG for any loss or claim as a
result of such reliance.
2.7 It is understood between the parties that Xxxxxxx will have
confidential information regarding LMG's Producers. Xxxxxxx expressly
covenants and agrees that it will not, for any reason whatsoever,
during the
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o CONFIDENTIAL INFORMATION HAS BEEN OMMITTED AND FILED SEPARATELY WITH THE SEC.
term of this Agreement and o, intentionally, directly, or knowingly
use such confidential information to take a systematic approach toward
soliciting and/or recruiting such Producers of LMG. During the term of
this Agreement, in the event that o is solicited by a o, o may
contract with such o only on products offered by o that are not
jointly developed with o. After termination of this Agreement, in the
event that o is solicited by a o, o may contract with such o.
2.8 Xxxxxxx shall pay all license or royalty fees for use of any
intellectual property belonging to a third party that is utilized with
any policies in APPENDIX A except to the extent of any intellectual
property used by LMG in connection with performing its services
pursuant to the Administrative Services Agreement between the parties
or this Agreement. Notwithstanding the foregoing, in the event that
this Agreement or the Administrative Services Agreements terminates
and Xxxxxxx desires to process or perform any services for which LMG
had previously been responsible, Xxxxxxx shall be required to obtain
all licenses and pay any royalty fees on its own behalf to the extent
Xxxxxxx wishes to use such intellectual property.Xxxxxxx shall be
responsible for the cost of filing the policy forms with applicable
regulatory authorities pertaining to the business underwritten by
Xxxxxxx that are jointly developed with LMG. "Policy forms," shall
include, but are not limited to, master policy forms, riders,
endorsements, certificates, notices, disclosures or administartive
forms. Notwithstanding the foregoing, LMG will assist in the drafting,
completing, preparation of filing of such policy forms.
3. RIGHTS AND OBLIGATIONS OF LMG
3.1 At all times during the term of this Agreement, LMG (or the licensed
individual who is acting on behalf of LMG in the capacity of an
Officer in such states that do not permit the licensing of
corporations) and all Wholesalers and Producers shall be properly
licensed with each state or other jurisdiction and properly appointed
with Xxxxxxx in each state or other jurisdiction within the Territory
before engaging in any activity which under the laws of such state or
other jurisdiction makes such licensing and appointment necessary.
Without limiting the generality of the foregoing, LMG shall require
all such Wholesalers and Producers to, at all times, bear the cost of
maintaining all licenses required by any such state, it being
understood that Xxxxxxx is not responsible for licensing fees or other
costs of licensing.
3.2 LMG will itself and will communicate to and cause each Wholesaler and
Producer to use only forms, applications, advertising (as such term is
generally defined by the regulation of the state or other jurisdiction
in which Policies, referenced in APPENDIX A, are solicited), office
procedures, guides and rules furnished, authorized or promulgated by
Xxxxxxx and agreed to by both parties and in each state or other
jurisdiction where any Wholesaler or Producer solicits Policies,
referenced in APPENDIX A. No written advertising or sales materials of
any kind, including sales illustrations, or recruiting material
referencing the Policies, referenced in APPENDIX A, of Xxxxxxx shall
be authorized by LMG until after it has been approved in writing by
Xxxxxxx. LMG will provide such materials with sufficient lead-time to
allow appropriate review by Xxxxxxx. Xxxxxxx will then use its best
efforts to provide a timely response. A time period not to exceed ten
(10) business days shall be deemed timely. No oral presentation of any
kind shall be authorized by LMG that does not conform to applicable
statutes and regulations or which does not accurately reflect the
terms and conditions of the Policies, referenced in APPENDIX A, being
sold. All recruiting practices of LMG shall comply with all applicable
laws, ordinances, and regulations of the appropriate authorities.
Xxxxxxx shall be responsible for the maintenance of the advertising
files and logs, as mandated by applicable laws and regulations.
3.3 LMG agrees to maintain the following insurance coverages:
(a) LMG will possess an adequate fidelity bond for any losses caused
by the dishonesty of LMG's employees or agents (not Wholesalers
or Producers) with limits of at least o. LMG will also maintain a
surety bond(s) as so required in the states which it is compelled
to do so. LMG will file such bond, if so required, with the
appropriate agency. The bond shall be executed by a corporate
insurer authorized to transact business in the states that
mandate the maintenance of such bond.
(b) LMG will possess and maintain at all times errors and omissions
coverage with a limit of not less than o written by an insurer
with a minimum Best's rating of A-. Such coverage will comply
with the requirements of the states in which such insurance
coverage is required.
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o CONFIDENTIAL INFORMATION HAS BEEN OMMITTED AND FILED SEPARATELY WITH THE SEC.
(c) LMG will possess and maintain commercial, general and liability
insurance with limits of not less than o per occurrence combined
single limit.
(d) LMG will require its Wholesalers and Producers to maintain Errors
and Omissions coverage with a limit of at least o per Wholesaler
and Producer, or per occurrence.
3.4 LMG may rely on instructions of any person indicated on Xxxxxxx'x
"Schedule of Authorized Personnel," when acting within the scope of
their authority, attached hereto as APPENDIX D. Each of such persons
is authorized to give instructions under this section with respect to
any matter arising in connection with this Agreement.
3.5 In the event a malfunction of the LMG systems, used in the offering
and/or sale of Polices specified in APPENDIX A, causes an error or
mistake in any record, report, data, information or output under the
terms of this Agreement, LMG shall at its expense correct and
reprocess such records in the most expeditious manner possible, with
the understanding that time is of the essence. LMG will reimburse
Xxxxxxx for any costs and/or expenses associated with such error or
mistake. In the event Xxxxxxx discovers any such errors or mistake it
shall, within three (3) business days after discovery, notify LMG in
writing of such error or mistake in any record, report, data,
information or output received by Xxxxxxx.
3.6 LMG is responsible for the payment to Xxxxxxx of all monies, which LMG
collects on behalf of Xxxxxxx. However, until Xxxxxxx receives all
monies due, the same shall be a debt payable by the debtor upon demand
for which Xxxxxxx may at its option offset with commissions otherwise
due until such liability is satisfied. Any indebtedness to Xxxxxxx
shall be a first lien against monies otherwise due under this
Agreement.
3.7 LMG, in performance of its marketing obligations and duties, will not
itself, and will use its best efforts, to prevent Wholesalers or
Producers appointed hereunder, in the performance of their obligations
and duties hereunder, from any of the following:
(a) Enter into any agreement or incur any obligation on behalf of
Xxxxxxx, except with Xxxxxxx'x written permission, or commit
Xxxxxxx to:
(i) pay any money to any such Wholesalers, Producer or employee,
or
(ii) a date that a payment will be made.
(b) Assign this Agreement or any compensation, other than commissions
payable to Wholesalers and Producers, payable under it without
the prior written consent of Xxxxxxx.
(c) Solicit applications for Xxxxxxx in any manner prohibited by or
inconsistent with the provisions of this Agreement or the rules
and regulations mutually agreed by both parties, now or hereafter
in force.
(d) With respect to any Policy,
(i) make any alterations, modifications or endorsements or
otherwise alter Xxxxxxx'x obligations as stated in the
Policy, as referenced in APPENDIX A;
(ii) collect or receive any premiums after the initial premium,
except as may be required in the Administrative Services
Agreement executed concurrently herewith, between Xxxxxxx
and LMG;
(iii) adjust or settle any claim; except as provided for in the
Administrative Services Agreement, executed concurrently
herewith.
(e) Initiate any civil or criminal action or proceeding, whether
or not brought in the name of Xxxxxxx, which may in any way
involve or affect Xxxxxxx, its affiliates, their business,
operations, or any Policy, as referenced in APPENDIX A,
issued by Xxxxxxx. The foregoing shall not be construed as a
waiver of any other right or entitlement hereunder, at law
or in equity, that LMG may have to enforce its rights
arising out of this Agreement.
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(f) Use or authorize the use of any written, oral or visual
communication, circular, advertisement or other publication
except as follows:
LMG agrees that it will not place into use, or distribute to
any person, any advertising, sales material or other
document (including, without limitation, illustrations,
telephone scripts and training materials) referring directly
or indirectly to Xxxxxxx or its Policies, or cause,
authorize or permit any person to do so, without Xxxxxxx'x
prior written consent. LMG agrees that it will not use the
name of Xxxxxxx on any business card, letterhead, website or
marquee or in any directory listing, or in any other manner,
or cause, authorize or permit any producer or other person
to do so, without Xxxxxxx'x prior written consent. LMG
agrees that it will not, nor will LMG permit its Wholesalers
and/or Producers to misrepresent Xxxxxxx or its Policies, as
referenced in APPENDIX A, or make any oral or written
representation which is inconsistent with the terms of such
policies or sales literature or is misleading in any way, or
refer to any insurance company tending to bring it into
disrepute.
(g) Knowingly or willfully violate the insurance laws or
regulations of any regulatory authority of any State or any
other jurisdiction in which LMG represents Xxxxxxx.
(h) Embezzle or knowingly or willfully misapply funds of Xxxxxxx
or any other person or entity.
(i) Perpetrate any fraud against Xxxxxxx or any other person or
entity.
3.8 LMG agrees that the compensation payable pursuant to Section 2.2
shall be accepted by it as full compensation from Xxxxxxx for its
marketing services hereunder, except as otherwise agreed by
mutual written consent of LMG and Xxxxxxx.
3.9 LMG will be solely responsible for any commissions to be paid to
its Wholesalers or Producers, which are earned as a result of
selling Xxxxxxx products through LMG, except as hereafter in
Section 8 of this Agreement.
3.10 LMG shall have no authority, nor shall it represent itself as
having such authority, other than as specifically set forth in
this Agreement. Without limiting the generality of the foregoing
sentence, LMG specifically agrees that it will not do any of the
following without the prior written consent of Xxxxxxx:
(a) Litigation: Institute, prosecute or defend any legal
proceedings in connection with any matter pertaining to the
offering and/or sale of the Policies identified in APPENDIX
A.
(b) Alterations: Waive, amend, modify, alter, terminate or
change any term, provision or condition stated in any Policy
Form or discharge any contract in the name of Xxxxxxx.
Notwithstanding the foregoing, LMG may waive, amend, modify,
alter, terminate or change any term, provision or condition
stated in any Policy Form or discharge any contract in the
name of Xxxxxxx in the resolution of complaints from
policyholders or regulatory authorities in accordance with
mutually acceptable written guidelines and procedures.
(c) Advice to Policyholders/Prospective Policyholders: Offer
tax, legal, or investment advice to any policyholder or
prospective policyholder of Xxxxxxx under any circumstances,
with respect to a Policy.
4. ASSIGNMENT, MODIFICATION AND TERMINATION OF AGREEMENT
4.1 Neither party may assign or delegate all or any part of its rights
and/or duties under this Agreement without the written consent, as
signed by one or more of the personnel shown on APPENDIX D, of the
granting party.
4.2 This Agreement may be modified or amended at any time by mutual
agreement of the parties, provided the modification or amendment is in
writing, signed by authorized personnel, as provided in APPENDIX D of
this Agreement.
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4.3 The termination of this Agreement is governed by the following
provisions:
(a) LMG or Xxxxxxx may terminate this Agreement without cause by
twelve (12) months written notice to the other, sent by mail.
This Agreement may be terminated by mutual agreement of the
parties in writing at any time. The terminating party shall
provide fifteen (15) days written notice of termination or
cancellation of this Agreement to the appropriate Departments of
Insurance if and to the extent required by applicable law or
regulation. LMG and Xxxxxxx shall fulfill any lawful obligations
with respect to such policies affected by this Agreement,
regardless of any dispute between LMG and Xxxxxxx.
(b) In the event that any state insurance department withdraws or
cancels LMG's license (or the license of the individual who is
acting on behalf of LMG in such states that do not permit the
licensing of corporations), or right to sell or conduct its
business, LMG will stop its marketing activity under this
Agreement in that state and notify Xxxxxxx. Xxxxxxx may terminate
the authority of LMG with regard to such affected Policies which
termination of authority shall be effective immediately.
(c) Each party shall provide ninety (90) days prior written notice to
the other of a request to revise the rates in APPENDIX B, or to
revise the manner of payment or to change any of the other terms
of this Agreement. The party receiving such notice must respond
in writing to such request within sixty (60) days of receipt. No
such change shall become effective unless and until it is agreed
to in writing by both parties.
(d) If either of the parties hereto shall materially breach this
Agreement or be materially in default in the performance of any
of its duties and obligations hereunder (the defaulting party),
the aggrieved party hereto may give written notice thereof to the
defaulting party and if such default or breach shall not have
been remedied within forty-five (45) days after such written
notice is given, then the aggrieved party may terminate this
Agreement by giving thirty (30) days written notice of such
termination to the defaulting party. This Agreement shall
terminate immediately upon expiry of the 30 day notice period.
(e) Either party may terminate this Agreement after providing 180
days advance written notice of termination to the other party in
the event that the actual production levels fall below expected
levels, as determined by LMG and Xxxxxxx. This Agreement shall
terminate immediately upon expiry of the 180 day notice period,
unless the parties mutually agree otherwise in writing.
(f) Notwithstanding anything herein to the contrary, Xxxxxxx or LMG
may immediately terminate this Agreement with cause, upon written
notice to the other. Cause includes, without limitation, acts or
omissions that constitute fraudulent, criminal or unethical
activity or blatant disregard for the terms and conditions of
this Agreement.
(g) Termination of this Agreement by default or breach by Xxxxxxx
shall not constitute a waiver of any rights of LMG in reference
to services performed prior to such termination; termination of
this Agreement by default or breach by LMG shall not constitute a
waiver by Xxxxxxx of any other rights it might have under this
Agreement.
(h) Termination of this Agreement does not affect in any way the
Administrative Services Agreement executed concurrently herewith.
5. HOLD HARMLESS AND INDEMNIFICATION
5.1 LMG shall indemnify and hold harmless Xxxxxxx from any and all claims,
liability, costs and expenses, including reasonable attorneys' fees,
arising out of LMG's negligent act(s) or omission(s); LMG's refusal to
comply with the terms of this Agreement; LMG's failure to comply with
any law or regulation with respect to its duties hereunder except that
LMG shall not be required to indemnify or hold harmless Xxxxxxx for
any act or omission of LMG which was directed orally or in writing by
Xxxxxxx unless LMG knew that
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o CONFIDENTIAL INFORMATION HAS BEEN OMMITTED AND FILED SEPARATELY WITH THE SEC.
5.2 such direction by Xxxxxxx was contrary to applicable law or regulation
or was otherwise contrary to good business practices and LMG failed to
advise Xxxxxxx.
5.3 Xxxxxxx shall indemnify and hold harmless LMG from any and all claims,
liability, costs and expenses, including reasonable attorneys' fees
arising out of Xxxxxxx'x negligent act(s) or omission(s); Xxxxxxx'x
refusal to comply with the terms of this Agreement; Xxxxxxx'x failure
to comply with any law or regulation with respect to the offering or
sale of contracts, or the records maintained.
5.3 Neither party shall be entitled to indemnification from the other
party for any claim resulting from its own negligent act(s) or
omission(s).
5.4 If any claim is made by a party which would give rise to a right or
indemnification under paragraph 5.1 the party entitled to
indemnification (the "Indemnified Party") promptly will give notice of
the claim to the party required to provide indemnification (the
"Indemnifying Party"). The Indemnifying Party shall have the right, at
its option and its own expense and by its own counsel, to participate
in the defense of any such indemnified claim for which indemnification
is provided by this Agreement. Notwithstanding the foregoing, the
Indemnifying Party shall not have the right to control or represent
the Indemnified Party in the defense of any claim.
6. RIGHTS AND OBLIGATIONS OF BOTH PARTIES
6.1 Each party agrees that it will not, knowingly or willingly, directly
or indirectly, at any time during the term of this Agreement or within
two (2) years thereafter, induce or attempt to induce any policyholder
or contract holder of the other party to terminate, reduce coverage,
or replace any Policy, as referenced in APPENDIX A, or otherwise
disturb the relationship between the other party and any of its
policyholders or contract holders.
6.2 During the term of this Agreement, o agrees not to develop any
proprietary products with any o without the express written approval
of o since the termination of such Wholesaler or Producer in
connection with this Agreement. o
6.3 Any Agent for Xxxxxxx who desires to sell the Xxxxxxx--LMG proprietary
products will need to contract with LMG to sell such product.
6.4 Xxxxxxx and LMG agree to provide the other with ninety (90) days
written notice of any intent to make significant changes or
modifications to any contract or Policy form for products co-developed
by Xxxxxxx and LMG except to the extent of any charge or modification
that is necessary to conform to applicable law or regulation. Both
parties will make best efforts to achieve a satisfactory resolution to
the cause of the proposed changes and may also agree to extend the
timeframe to implement such change if such change is pursued, unless
otherwise mutually agreed upon in writing by LMG and Xxxxxxx.
6.5 Each party shall be excused from performance for any period and to the
extent that the party is prevented from performing any services, in
whole or in part as a result of delays caused by an act of God, war,
civil disturbance, court order, labor dispute, or other cause beyond
that parties reasonable control, including failures or fluctuations in
electrical power, heat, light, air conditioning, or telecommunications
equipment and such non-performance shall not be a default or a ground
for termination. Notwithstanding the above, LMG agrees that it will
establish and maintain reasonable recovery steps, including technical
disaster recovery facilities, uninterruptable power supplies for
computer equipment and communications and that as a result thereof LMG
will use its best efforts to ensure that the Computer System shall be
operational within 48 hours of a performance failure. LMG's Rome,
Georgia, and Petaluma, California, offices will provide for each
others' off-premises site for storage of backup software for the
operating systems and data files.
6.6 LMG and Xxxxxxx shall each be liable for fifty-percent (50%) of the
net debit balances (outstanding commission debit balances less any
debit amounts recovered via collection efforts) incurred by
Wholesalers and Producers that are mutually agreed in writing deemed
to be uncollectible.
7. PROPRIETARY AND CONFIDENTIAL INFORMATION
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o CONFIDENTIAL INFORMATION HAS BEEN OMMITTED AND FILED SEPARATELY WITH THE SEC.
7.1 LMG acknowledges that certain information received from Xxxxxxx
including, without limitation, information concerning Xxxxxxx
customers or consumers, may be proprietary and/or confidential in
nature. All such information shall be used by LMG solely for purposes
of soliciting Policies pursuant to this Agreement or for providing
services pursuant to the Administrative Services Agreement between the
parties. LMG agrees to indemnify and hold Xxxxxxx harmless from any
and all loss and expenses sustained by Xxxxxxx as a result of the
unauthorized use of proprietary and/or confidential information by
LMG.
7.2 Xxxxxxx acknowledges that certain information received from LMG may be
proprietary and/or confidential in nature. All such information shall
be used by Xxxxxxx solely for purposes contemplated by, and in a
manner that is consistent with, this Agreement or the Administrative
Services Agreement between the parties. Xxxxxxx agrees to indemnify
and hold LMG harmless from any and all loss and expenses sustained by
LMG as a result of the unauthorized use of proprietary and/or
confidential information by Xxxxxxx.
7.3 LMG and Xxxxxxx shall each have in place reasonable security measures
to safeguard the confidentiality of the other's proprietary and
confidential information and the nonpublic information of consumers
and customers in their possession.
8. VESTING OF RENEWAL COMMISSIONS
8.1 LMG, its successors, executors, assigns, or administrators are vested
as to commissions provided in APPENDIX B, and shall continue to
receive commissions on premiums on Policies received by Xxxxxxx for as
long as the Policy remains in force.
8.2 In the event of any dispute between LMG and Xxxxxxx, Xxxxxxx shall
continue to pay to LMG any commissions due to any Wholesaler or
Producer that were earned prior to such dispute except to the extent
such commissions are disputed by Xxxxxxx. Furthermore, in the event of
the termination of this Agreement, Xxxxxxx guarantees the commission
payment due to Wholesalers and Producers to which they may have become
entitled prior to the effective date of termination to the extent that
Xxxxxxx has not previously remitted such commissions to LMG. Xxxxxxx
shall either pay any outstanding commissions directly to the Producer
or Wholesaler, or to LMG, who will remit such monies to the
appropriate Producer or Wholesaler. Xxxxxxx will provide written
notice to LMG of its election to pay such commissions directly to the
Producers or Wholesalers or to LMG. Upon written notice, LMG will use
its best efforts to provide Xxxxxxx with information concerning the
Producer(s) and transaction(s) required to pay such commissions.
9. NON-COMPETE PROVISION
9.1 Xxxxxxx agrees that it will not, during the term of this Agreement and
for a o after the termination of this Agreement, sell or market any
insurance product with features or specifications that are
substantially similar to those unique features in any proprietary
product developed by LMG and Xxxxxxx, with any individual or entity
other than LMG. LMG agrees that it will not, during the term of this
Agreement and for a o after the termination of this Agreement, sell or
market any insurance product whose features or specifications are
substantially similar to those unique features in any proprietary
product developed by LMG and Xxxxxxx. APPENDIX A shall identify all
proprietary products with any unique feature.
9.2 Notwithstanding the foregoing, in the event that o, and LMG has not
satisfied the premium objective for such product as set forth in
APPENDIX E, o may separately begin to sell and/or market the same or a
substantially similar product.
10. GENERAL PROVISIONS
10.1 The parties agree this Agreement is an honorable undertaking, and
agree to cooperate each with the other in carrying out its provisions.
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10.2 Each party will cause its employees to, and LMG will advise its
Wholesalers and Producers to, upon receipt of any summons or other
notice of suit or regulatory authority inquiry wherein the other party
is named in any manner, forward any and all such documents within five
(5) business days to the attention of the other party by facsimile,
express or overnight mail, or courier.
10.3 The waiver of any breach of any term, covenant or condition of this
Agreement shall not be deemed a waiver of any subsequent breach of the
same or any other term, covenant, or condition. No term, covenant, or
condition of this Agreement shall be deemed to have been waived unless
such waiver is in writing signed by the party charged therewith.
10.4 For any notice under this Agreement, notice shall be sufficient and
effective five (5) business days after deposit in the U.S. Mail,
postage prepaid, return receipt requested, or upon receipt if
delivered personally or by fax or facsimile or by a delivery service.
Such notice shall be directed as follows:
To LMG: Legacy Marketing Group To Xxxxxxx: Xxxx Xxxxxxx Life Insurance Company
Xxxxxxx Xxxxx, President Xxxxx Xxxxx, Vice President
0000 Xxxxxx Xxxxxx 000 Xxxxxxxxx Xxxxxx
Xxxxxxxx, Xxxxxxxxxx 00000 Xxxxxx, Xxxxxxxxxxxxx 00000
With copy to: Xxxx Xxxxxxx Life Insurance Company
With copy to: Xxxxxx Xxxxxxx & Xxxxxxxxxx LLP Xxxxxxx Xxxx Xxxxxx, Senior Counsel
00 Xxxxxxxxx Xxxx Xxxxx 000 Xxxxxxxxx Xxxxxx
Xxxxxxx, Xxxxxxx 00000 Xxxxxx, Xxxxxxxxxxxxx 00000
10.5 To the extent that the rules and regulations do not conflict with the
terms of this Agreement, LMG and Xxxxxxx will conform to the rules and
regulations as mutually agreed upon by LMG and Xxxxxxx. This provision
shall not be construed to alter the relationship of the parties as
provided above.
10.6 Each party expressly represents and warrants that it has the authority
to enter into this Agreement and that it is not or will not be, by
virtue of entering into this Agreement or otherwise, in breach of any
other agreement with any other insurance company, association, firm,
person or corporation. Each party warrants that the other party will
be free from interference or disturbance in its use of all products,
advertising, marketing techniques and all information provided by the
originating party.
10.7 This Agreement shall be binding upon the successor and assignees of
Xxxxxxx as well as upon LMG's successor and permissive assignees.
10.8 The persons signing this Agreement on behalf of Xxxxxxx and LMG
warrant, covenant and represent that they are authorized to execute
this document on behalf of such corporations pursuant to their bylaws
or a resolution of their board of directors or other authority.
10.9 This Agreement, including APPENDICES A, B, C, D and E attached and the
provisions thereof, constitute the entire agreement between the
parties. This Agreement shall be governed and construed in accordance
with the laws of the State of California. Any similar agreement signed
prior to the execution dates below is null and void and abrogated
hereby. No change, waiver, or discharge shall be valid unless in
writing and signed by an authorized representative of the party
against whom such change, waiver, or discharge is sought to be
enforced. No delay or omission by either party to exercise any right
or power shall impair such right or power or be construed as a waiver.
A waiver by either of the parties of any of the covenants to be
performed by the other or any breach shall not be construed to be a
waiver of any succeeding breach or of any other covenant.
10.10 LMG shall provide reasonable access during normal business hours to
any location from which LMG conducts its business and provides
services to Xxxxxxx pursuant to this Agreement to auditors designated
in writing by Xxxxxxx for the purpose of performing audits for
Xxxxxxx. Xxxxxxx shall give reasonable advance written notice of an
audit and include in that notice the matters, which it will audit. LMG
shall
9
provide the auditors any assistance they may reasonably require. Such
auditors shall have the right during normal business hours to audit
any business record, activity, procedure, or operation of LMG that is
reasonably related to the business marketed under this Agreement,
including the right to interview any LMG personnel involved in
providing or supporting such responsibilities.
LMG will comply with all the relevant provisions contained in
applicable state and federal codes or statutes. If any provision of
this Agreement is in conflict with applicable laws or regulations,
such provision will be deemed to be amended to conform with such laws.
Further, if the laws of the State that governs this Agreement require
the inclusion of certain provisions of relevant statutes, this
contract shall be deemed to be amended to conform with such laws.
10.11 LMG and Xxxxxxx agree to inform the other of any changes in its legal
structure, and of any material changes in its officers or partners
listed in APPENDIX D.
10.12 Xxxxxxx shall be responsible for researching, obtaining, and the
registration of any service marks issued by the U.S. Patent and
Trademark Office for use with the products jointly developed by LMG
and Xxxxxxx, and any costs associated therewith, and Xxxxxxx shall own
all such rights. Xxxxxxx grants to LMG a gratuitous license for the
use of such marks on LMG and Xxxxxxx proprietary products.
Notwithstanding the foregoing, LMG may register and own its own marks
that may be used by LMG to market products jointly developed by LMG
and Xxxxxxx that are underwritten by Xxxxxxx. Further, LMG grants to
Xxxxxxx a gratuitous license for the use of its marks on LMG and
Xxxxxxx proprietary products. Each party will not use the other's
Service Marks, Trademarks and Tradenames, or the name of any affiliate
of the other in any way or manner not specifically authorized in
writing by the other.
10.13 In no event and under no circumstances, however, shall either party
under this Agreement be liable to the other party under any provision
of this Agreement for lost profits or for exemplary, speculative,
special, consequential punitive damages.
10.14 Any claim or dispute arising out of or relating to this Agreement, or
any claimed breach thereof, or arising out of or relating to the
relationship between the parties shall be settled by arbitration
administered by the American Arbitration Association, in San
Francisco, California, under its Commercial Arbitration Rules and the
judgment on the award rendered by the arbitrator may be entered in any
court having jurisdiction.
10.15 If any clause, paragraph, term or provision of this Agreement shall
be found to be void or unenforceable by any court of competent
jurisdiction, such clause, paragraph, term or provision shall be
severed from the Agreement, and such findings shall not affect the
remainder of this Agreement.
10.16 Survival: Sections 2.7, 5, 6.1, 6.2, 8, 9, 10.14 and 10.15 shall
survive the termination of this Agreement.
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In witness whereof, the parties here to have executed this Agreement to take
effect on the effective date specified.
LEGACY MARKETING GROUP
By: /s/ Xxx X. Xxxx
----------------
Title: V.P. Product Development
------------------------
Date: January 18, 2001
----------------
Xxxx Xxxxxxx Life Insurance Company
By: /s/ Xxxxx X. Xxxxx
------------------
Title: Vice President
--------------
Date: January 18, 2001
----------------
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APPENDIX A
GEOGRAPHIC TERRITORY:
The District of Columbia and all states except Alabama
POLICY FORMS
(To be incorporated upon completion of final product specifications.)
12
APPENDIX B
COMMISSION AND MARKETING ALLOWANCE FEES
COMMISSION
OVERRIDE COMMISSION
MARKETING ALLOWANCE
LMG TRAIL COMMISSION
(To be incorporated upon completion of final product specifications.)
13
APPENDIX C
WHOLESALER AND PRODUCER AGREEMENTS AND/OR APPROPRIATE AMENDMENTS
14
APPENDIX D
SCHEDULE OF AUTHORIZED PERSONNEL
Representing Xxxxxxx
Xxxxxxx Xxx Xxxx, Senior Vice President
Xxxxx Xxxxx, Vice President
Representing LMG
Xxxx Xxxxxxxx Chief Information Officer
Xxxxx Xxxxx Chief Officer of Strategic Development
Xxxxx Xxxxxx Chief Financial Officer
Xxxxx Xxxxx Chief Executive Officer
Xxxx Xxxxxx Chief Operations Officer
Xxx Xxxx Vice President of Product Development
Xxxx Xxxxxxx Vice President of Distribution
Xxxx Xxxxxx Officer of Special Markets
15
APPENDIX E
Premium Level Goals
(To be incorporated upon completion of final product specifications.)
16
