EXHIBIT 10.1
Agreement Between the Attorney General of the State of New York and
the Superintendent of Insurance of the State of New York, and
▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ Companies, Inc., ▇▇▇▇▇ Inc. and their subsidiaries and affiliates
(collectively "Marsh") dated January 30, 2005
WHEREAS, the New York Attorney General (the "Attorney General") commenced
an action against ▇▇▇▇▇ & McLennan Companies, Inc. and ▇▇▇▇▇ Inc. pursuant to
Executive Law ss. 63 (12), the ▇▇▇▇▇▇▇▇ Act (Gen. Bus. Law ss. 340 et seq.), the
▇▇▇▇▇▇ Act (Gen. Bus. Law ss. 352-c) and the common law of the State of New York
dated October 14, 2004 (the "Complaint"), and has conducted an investigation
related thereto (the "Attorney General's Investigation");
WHEREAS, the Superintendent of Insurance of the State of New York (the
"Superintendent") issued a Citation to ▇▇▇▇▇ & McLennan Companies, Inc. and
certain of its subsidiaries dated October 21, 2004 and an Amended Citation dated
October 25, 2004 (collectively, the "Amended Citation") pursuant to ss. 2110 of
the Insurance Law, and has conducted an investigation related thereto (the
"Superintendent's Investigation");
WHEREAS, the Attorney General and Superintendent have alleged that Marsh
unlawfully deceived its clients by a) steering clients' insurance business to
favored insurance companies, and b) soliciting fictitious bids in order to assure
that insurance policies were placed to benefit favored insurers, as alleged in the
Complaint;
WHEREAS, Marsh is cooperating with the Attorney General and
Superintendent's Investigations;
WHEREAS, in the wake of the filing of the Complaint and the Amended
Citation, Marsh has adopted, and under this Agreement (the "Agreement"), will
continue to adopt, a
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number of business reforms that will govern the conduct of ▇▇▇▇▇'▇ employees;
WHEREAS, the Attorney General, the Superintendent and Marsh wish to enter
into this Agreement to resolve all issues related to Marsh raised in the Complaint
and the Amended Citation; WHEREAS, the Attorney General and Superintendent find
the relief and agreements contained in this Agreement appropriate and in the
public interest;
WHEREAS, this Agreement is entered into solely for the purpose of
resolving the Complaint and Amended Citation, and is not intended to be used for
any other purpose;
WHEREAS, without admitting or denying any claim in the Complaint or the
assertions in the Amended Citation, Marsh is entering into this Agreement prior to
any court making any findings of fact or conclusions of law pursuant to any
allegations by the Attorney General or the Superintendent;
WHEREAS, neither this Agreement, nor any acts performed nor documents
executed in furtherance of this Agreement, may be used as an admission of the
allegations and claims contained in the Complaint and the Amended Citation;
NOW THEREFORE, Marsh, the Attorney General and the Superintendent hereby
enter into this Agreement, with a statement of apology attached as Exhibit 1, and
agree as follows:
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MONETARY RELIEF
---------------
1. Marsh shall pay Eight Hundred Fifty Million Dollars ($850,000,000) into a fund
(the "Fund") over the next four years in four annual payments to be paid to
▇▇▇▇▇'▇ policyholder clients who retained Marsh to place, renew, consult on or
service insurance where such placement resulted in contingent commissions or
overrides. All of the money paid into the Fund and any interest earned thereon
shall be paid to such policyholder clients pursuant to this Agreement. No portion
of the Fund shall be considered a fine or a penalty. This sum is in full
satisfaction of ▇▇▇▇▇'▇ obligations hereunder, and neither the Attorney General
nor the Superintendent shall seek to impose on Marsh any other financial
obligation or liability related to the Complaint or the Amended Citation.
2. Marsh shall A) by April 30, 2005 calculate, in accordance with a formula
approved by the Attorney General, the amount of money each of the U.S.
policyholder clients who retained Marsh to place, renew, consult on or service
insurance with inception or renewal dates between January 1, 2001 through December
31, 2004 where such placement, renewal, consultation or servicing resulted in
contingent commissions or overrides recorded by Marsh between January 1, 2001
through December 31, 2004 (the "Relevant Period") is eligible to receive; B)
within ten (10) days of completing these calculations, file a report with the
Attorney General and the Superintendent, certified by an officer of Marsh, setting
forth: I) each client's name and address; ii) the client's insurer(s), product
line(s) and policy(ies) purchased and policy number(s); iii) the amount the client
paid in premiums or consulting fees for each such policy; iv) for each such
policy, the amount of contingent commission or override revenue recorded by Marsh
during the Relevant Period attributable to that policy, in accordance with a
calculation approved by the Attorney General and
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the Superintendent; and v) the amount of contingent commission or override revenue
each client is eligible to receive for each such policy and in the aggregate for
all such policies pursuant to this Agreement; and C) by May 20, 2005, send a
notice, subject to the approval of the Attorney General and the Superintendent, to
each client eligible to be paid from the Fund, setting forth items ii) through v),
above, and stating that the amount paid may increase if there is less than full
participation by eligible clients in the Fund. For the purposes of this paragraph,
"U.S. policyholder clients" means U.S.-domiciled policyholder clients and
policyholder clients who retained ▇▇▇▇▇'▇ U.S. offices to place, renew, consult on
or service insurance.
3. Clients eligible to receive a distribution from the Fund shall have until
September 20, 2005 to request a distribution. Eligible clients who voluntarily
elect to receive a cash distribution (the "Participating Policyholders") shall
tender a release in the form attached hereto as Exhibit 2. In the event that any
eligible client elects not to participate or otherwise does not respond (the
"Non-Participating Policyholders"), that client's allocated share may be used by
Marsh to satisfy any pending or other claims asserted by policyholders relating to
these matters. In no event shall a distribution be made from the Fund to any
Non-Participating Policyholder until all Participating Policyholders have been
paid the full aggregate amount due as calculated pursuant to P. 2 above; nor shall
the total payments from the Fund to any Non-participating Policyholder exceed 80%
of that Non-participating Policyholder's original allocated share. If any funds
remain in the fund as of June 20, 2008, any such funds shall be distributed on a
pro rata basis to the Participating Policyholders.
4. In no event shall any of the funds in the Fund be used to pay attorney fees.
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5. Marsh shall pay $255,000,000 into the Fund on or before June 1, 2005. Marsh
shall pay $255,000,000 into the Fund on or before June 1, 2006. Marsh shall pay
$170,000,000 into the Fund on or before June 1, 2007. Marsh shall pay $170,000,000
into the Fund on or before June 1, 2008.
6. On November 1, 2005, June 30, 2006, June 30, 2007, and June 30, 2008, Marsh
shall pay proportionally to each Participating Policyholder as much of that
Participating Policyholder's aggregate share of the Fund as possible with the
monies then available in the Fund pursuant to a calculation approved by the
Attorney General and the Superintendent. Within forty-five (45) days of each
payment from the fund, Marsh shall file a report with the Attorney General and the
Superintendent, certified by an officer of Marsh, listing all amounts paid from
the Fund.
BUSINESS REFORMS
----------------
7. Within sixty (60) days of the effective date of this Agreement, Marsh shall
undertake the following business reforms.
A. Permissible Forms of Compensation
------------------------------------
8. In connection with its insurance brokerage, agency, producing, consulting and
other services in placing, renewing, consulting on or servicing any insurance
policy, Marsh shall accept only: a specific fee to be paid by the client; a
specific percentage commission on premium to be paid by the insurer set at the
time of purchase, renewal, placement or servicing of the insurance policy; or a
combination of both. Marsh shall accept no such commissions unless, before the
binding of any such policy: (a) Marsh in plain, unambiguous written language fully
discloses such commissions, in either dollars or percentage amounts; and (b) the
client consents in writing. Nothing in this
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paragraph relieves Marsh of complying with additional requirements imposed by law,
including the requirements for written documentation relating to fees paid
directly by clients. Marsh may not retain interest earned on premiums collected on
behalf of insurers without prior notification to the client, and only when such
retention is consistent with the requirements of, and is permitted by, applicable
law.
9. Marsh shall not hereafter, except as set forth in P. 8, above, directly or
indirectly accept or request any thing of material value from an insurance company
including, but not limited to, money, credits, loans, forgiveness of principal or
interest, vacations, prizes, gifts or the payment of employee salaries or expenses
(hereinafter collectively "Compensation").
B. Prohibition of Contingent Compensation
-----------------------------------------
10. In placing, renewing, consulting on or servicing any insurance policy, Marsh
shall not directly or indirectly accept from or request of any insurer any
Contingent Compensation. For purposes of this Agreement, Contingent Compensation
is any Compensation contingent upon ▇▇▇▇▇'▇: a) placing a particular number of
policies or dollar value of premium with the insurer, b) achieving a particular
level of growth in the number of policies placed or dollar value of premium with
the insurer, c) meeting a particular rate of retention or renewal of policies in
force with the insurer, d) placing or keeping sufficient insurance business with
the insurer to achieve a particular loss ratio or any other measure of
profitability, e) providing preferential treatment in the placement process,
including but not limited to the giving of last looks, first looks, rights of
first refusal, or limiting the number of quotes sought from insurers for insurance
placements, or f) obtaining anything else of material value for the insurer.
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C. Prohibition of "Pay-To-Play" Arrangements
--------------------------------------------
11. In placing, renewing, consulting on or servicing any insurance policy, Marsh
shall not directly or indirectly accept from or request of any insurer any
Compensation in connection with ▇▇▇▇▇'▇ selection of insurance companies from
which to solicit bids for its clients.
D. Prohibition of "Bid-Rigging" Arrangements
--------------------------------------------
12. In placing, renewing, consulting on or servicing any insurance policy, Marsh
shall not directly or indirectly knowingly accept from or request of any insurer
any false, fictitious, inflated, artificial, "B" or "throw away" quote or
indication, or any other quote or indication except for a quote or indication that
represents the insurer's best evaluation at the time when the quote or indication
is given of the minimum premium the insurer would require to bind the insurance
coverage desired by ▇▇▇▇▇'▇ client. Nothing herein shall preclude Marsh from
accepting or requesting any bona fide quote or indication.
E. Prohibition of Reinsurance Brokerage "Leveraging"
----------------------------------------------------
13. In placing, renewing, consulting on or servicing any insurance policy, Marsh
shall not directly or indirectly accept from or request of any insurer any promise
or commitment to use any of ▇▇▇▇▇'▇ brokerage, agency, producing or consulting
services, including reinsurance brokerage, agency or producing services,
contingent upon any of the factors listed in P. 10 a) - f), above.
F. Prohibition of Inappropriate Use of Wholesalers
--------------------------------------------------
14. In placing, renewing, consulting on or servicing any insurance policy, Marsh
shall not directly or indirectly knowingly place, renew, consult on or service its
clients' insurance business through a wholesale broker unless agreed to by the
client after full disclosure of a) the Compensation
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received or to be received by Marsh, b) any Marsh interest in or contractual
agreement with the wholesaler, and c) any alternatives to using a wholesaler.
G. Mandated Disclosures to Clients
----------------------------------
15. Marsh in placing, renewing, consulting on or servicing any insurance policy
shall in writing: a) prior to binding, disclose to each client all quotes and
indications sought and all quotes and indications received by Marsh in connection
with the coverage of the client's risk with all terms, including but not limited
to any Marsh interest in or contractual agreements with any of the prospective
insurers, and all Compensation to be received by Marsh for each quote, in dollars
if known at that time or as a percent of premium if the dollar amount is not known
at that time, from any insurer or third party in connection with the placement,
renewal, consultation on or servicing of insurance for that client; b) provide
disclosure to each client and obtain written consent in accordance with P. 8 of
this Agreement for each client, and c) disclose to each client at the end of each
year all Compensation received during the preceding year or contemplated to be
received from any insurer or third party in connection with the placement,
renewal, consultation on or servicing of that client's policy.
H. Standards of Conduct and Training
------------------------------------
16. Marsh shall implement company-wide written standards of conduct regarding
Compensation from insurers, consistent with the terms of this Agreement, subject
to approval of the Superintendent, which implementation shall include, inter alia,
appropriate training of relevant employees, including but not limited to training
in business ethics, professional obligations, conflicts of interest, anti-trust
and trade practices compliance, and record keeping.
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17. Marsh shall not place its own financial interest ahead of its clients'
interests in determining the best available insurance product or service for its
clients. Marsh shall communicate with its clients in sufficient detail to enable
them to make informed choices on insurance products or services, and shall provide
complete and accurate information to prospective and current clients on all
proposals and bids received from insurers, including the amount of Compensation or
other things of value that were or will be paid to Marsh by each insurer.
J. Prohibition Against Violating New York Law
---------------------------------------------
18. Marsh shall not directly or indirectly engage or attempt to engage in
violations of Executive Law ss. 63 (12), the ▇▇▇▇▇▇▇▇ Act (Gen. Bus. Law ss. 340
et seq.), and the ▇▇▇▇▇▇ Act (Gen. Bus. Law ss. 352-c).
K. Limitation on Extraterritorial Effect
----------------------------------------
19. The provisions of paragraphs 7 through 17 shall apply only to those Marsh
entities that (1) service clients domiciled in the United States; (2) place,
renew, consult on or provide services for policies covering risks in the Unites
States; or (3) are, themselves, domiciled in the United States.
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MONITORING COMPLIANCE AND REPORTING
-----------------------------------
20. Marsh shall establish a Compliance Committee of the Board of Directors of
▇▇▇▇▇ and McLennan Companies, Inc. which shall monitor ▇▇▇▇▇'▇ compliance with the
standards of conduct regarding Compensation from insurers and shall report on a
quarterly basis to the Board of Directors the results of its monitoring activities
for a period of five (5) years from the effective date of this Agreement.
21. Marsh shall maintain a record of all complaints received concerning any
Compensation from an insurer which shall be provided to the Compliance Committee
of the Board of Directors with the Compliance Committee's quarterly report and to
the Superintendent annually commencing from the effective date of this Agreement.
22. The Board of Directors of ▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ Companies, Inc. shall file annual
reports with the Superintendent on compliance with the standards of conduct
regarding Compensation arrangements for five (5) years commencing in December
2005, which shall also include the amount of each form of Compensation received by
Marsh from each insurer with which it placed insurance during the preceding year.
COOPERATION WITH THE SUPERINTENDENT
-----------------------------------
23. Marsh shall be subject to annual examination by the Superintendent for five
(5) years at ▇▇▇▇▇'▇ expense beginning in 2005. Marsh shall fully cooperate with
the Superintendent in such examinations. Marsh shall additionally provide private,
secure office space, photocopying equipment and any other administrative or
clerical resources necessary to assist in any examination,
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as well as all relevant data, provided upon request by the Superintendent in
electronic or computerized format. The Superintendent may coordinate such
examinations with other states.
COOPERATION WITH THE ATTORNEY GENERAL
-------------------------------------
24. Marsh shall fully and promptly cooperate with the Attorney General with regard
to his Investigation, and related proceedings and actions, of any other person,
corporation or entity, including but not limited to ▇▇▇▇▇'▇ current and former
employees, concerning the insurance industry. Marsh shall use its best efforts to
ensure that all its officers, directors, employees, and agents also fully and
promptly cooperate with the Attorney General in his Investigation and related
proceedings and actions. Cooperation shall include without limitation: (1)
production voluntarily and without service of subpoena of any information and all
documents or other tangible evidence reasonably requested by the Attorney General,
and any compilations or summaries of information or data that the Attorney General
reasonably requests be prepared; (2) without the necessity of a subpoena, having
▇▇▇▇▇'▇ officers, directors, employees and agents attend any proceedings at which
the presence of any such persons is requested by the Attorney General and having
such persons answer any and all inquiries that may be put by the Attorney General
(or any of the Attorney General's deputies, assistants or agents) to any of them
at any proceedings or otherwise ("proceedings" include but are not limited to any
meetings, interviews, depositions, hearings, grand jury hearing, trial or other
proceedings); (3) fully, fairly and truthfully disclosing all information and
producing all records and other evidence in its possession relevant to all
inquiries reasonably made by the Attorney General concerning any fraudulent or
criminal conduct whatsoever about which it has any knowledge or information; (4)
in the event any document is withheld or redacted on grounds
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of privilege, work-product or other legal doctrine, a statement shall be submitted
in writing by Marsh indicating: a) the type of document; b) the date of the
document; c) the author and recipient of the document; d) the general subject
matter of the document; e) the reason for withholding the document; and f) the
▇▇▇▇▇ number or range of the withheld document. The Attorney General may challenge
such claim in any forum of its choice and may, without limitation, rely on all
documents or communications theretofore produced or the contents of which have
been described by Marsh, its officers, directors, employees, or agents; and (5)
Marsh shall not jeopardize the safety of any investigator or the confidentiality
of any aspect of the Attorney General's Investigation, including sharing or
disclosing evidence, documents, or other information with others during the course
of the investigation, without the consent of the Attorney General. Nothing herein
shall prevent Marsh from providing such evidence to other regulators, or as
otherwise required by law.
25. Marsh shall comply fully with the terms of this Agreement. If Marsh violates
the terms of P. 24 in any material respect, as determined solely by the Attorney
General: (1) the Attorney General may pursue any action, criminal or civil,
against any entity for any crime it has committed, as authorized by law, without
limitation; (2) as to any criminal prosecution brought by the Attorney General for
violation of law committed within six years prior to the date of this Agreement or
for any violation committed on or after the date of this Agreement, Marsh shall
waive any claim that such prosecution is time barred on grounds of speedy trial or
speedy arraignment or the statute of limitations.
OTHER PROVISIONS
----------------
26. The Superintendent may take regulatory action to enforce this Agreement. The
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Superintendent may investigate or take regulatory action against any current or
former Marsh employee who is licensed by the Superintendent.
27. Marsh shall not seek or accept, directly or indirectly, indemnification
pursuant to any insurance policy, with regard to any or all of the amounts payable
pursuant to this Agreement.
28. The Attorney General will promptly file a Notice Discontinuing Action with
Prejudice, in the form attached hereto as Exhibit 3, voluntarily dismissing the
Complaint with prejudice, and will not initiate a new case against Marsh related
to the matters set forth in the Complaint or uncovered to date by the Attorney
General's Investigation.
29. The Superintendent will promptly discontinue the administrative proceeding
commenced by the Amended Citation with prejudice, pursuant to a Stipulation to be
executed contemporaneously herewith in the form attached hereto as Exhibit 4, and
will not initiate a new administrative proceeding against Marsh related to the
matters set forth in the Amended Citation or uncovered to date by the
Superintendent's Investigation.
30. This Agreement is not intended to disqualify Marsh, or any current employees
of Marsh, from engaging in any business in New York or in any other jurisdiction.
Nothing in this Agreement shall relieve ▇▇▇▇▇'▇ obligations imposed by any
applicable state insurance law or regulations or other applicable law.
31. This Agreement shall not confer any rights upon any persons or entities
besides the Attorney General, the Superintendent and Marsh.
32. Marsh shall maintain custody of, or make arrangements to have maintained, all
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documents and records of Marsh related to this matter for a period of not less
than six (6) years.
33. The Attorney General of the State of New York may make such application as
appropriate to enforce or interpret the provisions of this Agreement, or in the
alternative, maintain any action, either civil or criminal, for such other and
further relief as the Attorney General may determine is proper and necessary for
the enforcement of this Agreement. If compliance with any aspect of this Agreement
proves impracticable, Marsh reserves the right to request that the parties modify
the Agreement accordingly.
34. In any application or in any such action, facsimile transmission of a copy of
any papers to current counsel for Marsh shall be good and sufficient service on
Marsh unless Marsh designates, in a writing to the Attorney General, another
person to receive service by facsimile transmission.
35. Facsimile transmission of a copy of this Agreement to counsel for each
defendant shall be good and sufficient service on Marsh.
36. This Agreement shall be governed by the laws of the State of New York without
regard to conflict of laws principles.
37. This Agreement may be executed in counterparts.
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WHEREFORE, the following signatures are affixed hereto on this 30th day of
January, 2005.
▇▇▇▇▇ ▇▇▇▇▇▇▇, ESQ. ▇▇▇▇▇▇ ▇▇▇▇▇
_________________________ _________________________
Attorney General Acting Superintendent of Insurance
State of New York New York State Insurance Department
▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇
By: ___________________________
▇▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇. Esq.
▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
(▇▇▇)▇▇▇-▇▇▇▇
Attorneys for ▇▇▇▇▇ &
McLennan Companies, Inc.
Attorneys for ▇▇▇▇▇ Inc.
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EXHIBIT 1
"▇▇▇▇▇ INC. WOULD LIKE TO TAKE THIS OPPORTUNITY TO APOLOGIZE FOR THE CONDUCT THAT
LED TO THE ACTIONS FILED BY THE NEW YORK STATE ATTORNEY GENERAL AND SUPERINTENDENT
OF INSURANCE. THE RECENT ADMISSIONS BY FORMER EMPLOYEES OF MARSH AND OTHER
COMPANIES HAVE MADE CLEAR THAT CERTAIN MARSH EMPLOYEES UNLAWFULLY DECEIVED THEIR
CUSTOMERS. SUCH CONDUCT WAS SHAMEFUL, AT ODDS WITH ▇▇▇▇▇'▇ STATED POLICIES AND
CONTRARY TO THE VALUES OF ▇▇▇▇▇'▇ TENS OF THOUSANDS OF OTHER EMPLOYEES.
IN RESPONSE, WE HAVE TAKEN PROMPT, CORRECTIVE ACTION AND IMPLEMENTED A SERIES OF
BUSINESS AND CORPORATE GOVERNANCE REFORMS. THE EMPLOYEES OF ▇▇▇▇▇ INC. ASK OUR
CLIENTS AND OTHERS TO ALLOW US THE OPPORTUNITY TO REGAIN THEIR TRUST."
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EXHIBIT 2
GENERAL RELEASE
---------------
This RELEASE (the "Release") is executed this ___ day of _______, 2005 by
RELEASOR (defined below) in favor of RELEASEE (defined below).
DEFINITIONS
-----------
"RELEASOR" refers to [fill in name ___________] and any of its affiliates,
subsidiaries, associates, general or limited partners or partnerships,
predecessors, successors, or assigns, including, without limitation, any of their
respective present or former officers, directors, trustees, employees, agents,
attorneys, representatives and shareholders, affiliates, associates, general or
limited partners or partnerships, heirs, executors, administrators, predecessors,
successors, assigns or insurers acting on behalf of RELEASOR.
"RELEASEE" refers to ▇▇▇▇▇ & McLennan Companies, Inc. and any of its
subsidiaries, affiliates, associates, general or limited partners or partnerships,
predecessors, successors, or assigns, including, without limitation, any of their
respective present or former officers, directors, trustees, employees, agents,
attorneys, representatives and shareholders, affiliates, associates, general or
limited partners or partnerships, heirs, executors, administrators, predecessors,
successors, assigns or insurers (collectively, "Marsh").
"AGREEMENT" refers to a certain agreement between Marsh and the Attorney
General of the State of New York ("NYAG") and the Superintendent of Insurance of
the State of New York ("NYSI") dated February ___, 2005, relating to an action
commenced against Marsh by NYAG dated October 14, 2004 captioned The People of the
State of New York against ▇▇▇▇▇ & McLennan Companies, Inc. and ▇▇▇▇▇ Inc., Index
No. 04/403342, and an investigation by NYAG relating to same (the "Complaint"),
and a Citation and Amended Citation captioned In the Matter of ▇▇▇▇▇ & McLennan
Companies, Inc. et. al., (Amended Citation No. 2004-0123-C), issued to Marsh by
NYSI on October 21, 2004 and October 25, 2004, respectively, and an investigation
by NYSI relating to same (collectively, the "Amended Citation").
RELEASE
-------
1. In consideration for the total payment of $___________ in accordance
with the terms of the Agreement, RELEASOR does hereby fully release, waive and
forever discharge RELEASEE from any and all claims, demands, debts, rights, causes
of action or liabilities whatsoever, including known and unknown claims, now
existing or hereafter arising, in law, equity or otherwise, whether under state,
federal or foreign statutory or common law, and whether possessed or asserted
directly, indirectly, derivatively, representatively or in any other capacity
(collectively, "claims"), to the extent any such claims are based upon, arise out
of or relate to, in whole or in part, any of the allegations, acts, omissions,
transactions, events, types of conduct or matters that are the subject of the
Complaint, the Amended Citation, except for claims which are based upon, arise out
of or relate to the purchase or sale of Marsh securities.
2. In the event that the total payment referred to in paragraph 1 is not
made for any reason, then this RELEASE shall be deemed null and void, provided
that any payments received by RELEASOR shall be credited to Marsh in connection
with any claims that RELEASOR may assert against Marsh, or that are asserted on
behalf of RELEASOR or by a class of which RELEASOR is a member, against Marsh.
3. This RELEASE may not be changed orally and shall be governed by and
interpreted in accordance with the internal laws of the State of New York, without
giving effect to choice of law principles, except to the extent that federal law
requires that federal law governs. Any disputes arising out of or related to this
RELEASE shall be
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subject to the exclusive jurisdiction of the Supreme Court of the State of New
York or, to the extent federal jurisdiction exists, the United States District
Court for the Southern District of New York.
4. Releasor represents and warrants that the claims have not been sold,
assigned or hypothecated in whole or in part.
Dated: _________________________________
RELEASOR: ______________________________
By: ____________________________________
Print Name: ____________________________
Title: _________________________________
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EXHIBIT 4
SUPREME COURT OF THE STATE OF NEW YORK
COUNTY OF NEW YORK
- - - - - - - - - - - - - - - - - - - - - x
THE PEOPLE OF THE STATE OF NEW YORK :
by ▇▇▇▇▇ ▇▇▇▇▇▇▇, Attorney General of :
the State of New York, :
:
Plaintiff, : Index No. 04/403342
:
: NOTICE
DISCONTINUING
- against - : ACTION WITH PREJUDICE
▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ COMPANIES, INC. :
and ▇▇▇▇▇ INC., :
:
Defendants. :
- - - - - - - - - - - - - - - - - - - - - x
PLEASE TAKE NOTICE that, pursuant to CPLR ss 3217(a) and the agreement annexed
hereto, plaintiff hereby discontinues this action with prejudice as of this date without costs to
either party against the other.
Dated: New York, New York
[date]
▇▇▇▇▇ ▇▇▇▇▇▇▇,
Attorney General of the State of New York
By: ____________________________________
▇▇▇▇▇ ▇. ▇▇▇▇▇, ▇▇
Assistant Attorney General
▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
(▇▇▇)▇▇▇-▇▇▇▇
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Attorney for Plaintiff
To: ▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ Companies, Inc.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇.
▇▇▇▇▇ Inc.
▇▇▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇.
WHEREFORE, the following signatures are affixed hereto this ___________ day of January,
2005.
▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ Companies, Inc.
By: ________________________
▇▇▇▇▇ Inc.
By: ________________________
▇▇▇▇▇ ▇▇▇▇▇▇▇, Attorney General of
the State of New York
By: __________________
▇▇
▇▇▇▇▇▇▇ ▇
▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇
INSURANCE DEPARTMENT
▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇
- - - - - - - - - - - - - - - - - - - - - -
In the Matter of
▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ COMPANIES, INC.,
▇▇▇▇▇, INC., ▇▇▇▇▇ PLACEMENT INC.
(formerly known as Marsh Global Broking
Inc.), ▇▇▇▇▇ USA INC., ▇▇▇▇▇ USA (ALASKA), STIPULATION
▇▇▇▇▇ USA (CONNECTICUT), ▇▇▇▇▇ USA No. 2004-0123-C
(MASSACHUSETTS), ▇▇▇▇▇ USA (MICHIGAN),
▇▇▇▇▇ USA (NEVADA), ▇▇▇▇▇ USA (OHIO),
▇▇▇▇▇ USA (PENNSYLVANIA), ▇▇▇▇▇ USA
(TEXAS), ▇▇▇▇▇ USA (UTAH), ▇▇▇▇▇
INSURANCE AGENCY & INVESTMENTS and
SEABURY & ▇▇▇▇▇ INC.,
Respondents.
- - - - - - - - - - - - - - - - - - - - - -
WHEREAS, ▇▇▇▇▇ Placement Inc. (formerly known as Marsh Global Broking Inc.)
is licensed as a broker under Section 2104 of the New York Insurance Law
("Insurance Law") and as an excess line broker under Section 2105 of the Insurance
Law; ▇▇▇▇▇ USA Inc. is licensed as a broker under Section 2104 of the Insurance
Law, as an excess line broker under Section 2105 of the Insurance Law and as an
agent under Section 2103(b) of the Insurance Law; ▇▇▇▇▇ USA (Alaska) is licensed
as an agent under Section 2103(b) of the Insurance Law; ▇▇▇▇▇ USA (Connecticut) is
licensed as a broker under Section 2104 of the Insurance Law, as an excess line
broker under Section 2105 of the Insurance Law and as an agent under Section
2103(a) of the Insurance Law; ▇▇▇▇▇ USA (Massachusetts) is licensed as a broker
under Section 2104 of the Insurance Law and as an agent under Section 2103(a) of
the Insurance Law; ▇▇▇▇▇ USA (Michigan) is licensed as a broker under Section 2104
of the Insurance Law and as an agent under Section 2103(a) of the Insurance Law;
▇▇▇▇▇ USA (Nevada) is licensed as a broker under Section 2104 of the Insurance
Law; ▇▇▇▇▇ USA (Ohio) is licensed as an agent under Section 2103(b) of the
Insurance Law; ▇▇▇▇▇ USA (Pennsylvania) is licensed as a broker under Section 2104
of the Insurance Law, as an excess line broker under Section 2105 of the Insurance
Law, as an agent under Section 2103 (a) and (b) of the Insurance Law, and as a
life broker under Section 2104(b)(1)(A) of the Insurance Law; ▇▇▇▇▇ USA (Utah) is
licensed as a broker under Section 2104 of the Insurance Law; ▇▇▇▇▇ USA (Texas) is
licensed as an agent under Section 2103(b) of the Insurance Law; ▇▇▇▇▇ Insurance
Agency & Investments is licensed as an agent under Section 2103(a) of the
Insurance Law; Seabury & ▇▇▇▇▇ Inc. is licensed as a broker under Section 2104 of
21
In the Matter of ▇▇▇▇▇ & McLennan Companies, Inc., et al. Page 22
the Insurance Law, as an excess line broker under Section 2105 of the Insurance
Law, as an agent under Section 2103(a) and (b) of the Insurance Law, and as an
independent adjuster under Section 2108 of the Insurance Law; and ▇▇▇▇▇ Inc. is a
Delaware corporation with its principal place of business in the State of New
York; and
WHEREAS, all of the foregoing Respondents are wholly owned subsidiaries of
Respondent ▇▇▇▇▇ & McLennan Companies, Inc., which is a Delaware corporation with
its principal place of business in the State of New York; and
WHEREAS, on or about October 14, 2004, the Attorney General of the State of
New York commenced a civil action in the Supreme Court of the State of New York,
County of New York, The People of the State of New York ▇. ▇▇▇▇▇ & ▇▇▇▇▇▇▇▇
Companies, Inc., et al., Index No. 04-403342 (the "Civil Action"), charging
Respondents ▇▇▇▇▇ & McLennan Companies, Inc. and ▇▇▇▇▇ Inc. with fraudulent and
anti-competitive practices in connection with the brokering of insurance business
in violation of the New York Executive Law, the General Business Law and common
law; and
WHEREAS, the Civil Action has been resolved pursuant to an Agreement
Between the Attorney General of the State of New York, the Superintendent of
Insurance and ▇▇▇▇▇ & McLennan Companies, Inc. and ▇▇▇▇▇ Inc., dated January 30,
2005 ("Settlement Agreement"), a copy of which is annexed hereto; and
WHEREAS, the attached Amended Citation, dated October 25, 2004, charging
the Respondents with having used fraudulent, coercive and/or dishonest practices,
having demonstrated untrustworthiness, violating Section 340 of the General
Business Law, and having engaged in determined violations of the Insurance Law,
was duly served on the Respondents; and
WHEREAS, Respondents have been advised and are aware of their statutory
right to notice and a hearing on said charges; and
WHEREAS, Respondents desire to resolve said charges by entering into a
Stipulation on the terms and conditions hereinafter set forth in lieu of
proceeding with a hearing in this matter; NOW THEREFORE,
IT IS HEREBY STIPULATED AND AGREED by and between the Respondents and the
New York State Insurance Department ("Department"), subject to the approval of the
Superintendent of Insurance, as follows:
1. Respondents waive their right to further notice and hearing in this
matter, and agree to fully comply with all of the terms and conditions of the
Settlement Agreement.
2. Respondents agree to cooperate fully in all Department examinations of
Respondents and in all Department investigations of current or former employees of
Respondents or licensees of the Department.
3. Respondents acknowledge that this Stipulation may be used against them
in any future Department proceeding if there is reason to believe the terms of the
Settlement Agreement or this Stipulation have been violated by Respondents, orif
the Department institutes disciplinary action against any Respondent for any
reason other than the acts considered herein.
4. The proceeding initiated by the attached Amended Citation is hereby
resolved and discontinued by the Department.
22
In the Matter of ▇▇▇▇▇ & McLennan Companies, Inc., et al. Page 23
Dated: ▇▇▇ ▇▇▇▇, ▇▇
▇▇▇▇▇▇▇ , ▇▇▇▇
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ INSURANCE DEPARTMENT
By: _____________________________________
▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
Principal Attorney
▇▇▇▇▇ & McLENNAN COMPANIES, INC.,
▇▇▇▇▇, INC., ▇▇▇▇▇ PLACEMENT INC.
(formerly known as Marsh Global Broking
Inc.), ▇▇▇▇▇ USA INC., ▇▇▇▇▇ USA (ALASKA),
▇▇▇▇▇ USA (CONNECTICUT), ▇▇▇▇▇ USA
(MASSACHUSETTS), ▇▇▇▇▇ USA (MICHIGAN),
▇▇▇▇▇ USA (NEVADA), ▇▇▇▇▇ USA (OHIO),
▇▇▇▇▇ USA (PENNSYLVANIA), ▇▇▇▇▇ USA
(TEXAS), ▇▇▇▇▇ USA (UTAH), ▇▇▇▇▇
INSURANCE AGENCY & INVESTMENTS and
SEABURY & ▇▇▇▇▇ INC.,
By: _____________________________________
Name:
Title:
STATE OF NEW YORK )
)ss.:
COUNTY OF )
On this day of January, 2005, before me personally came
, to me known, who, being by me duly sworn, did depose
and say that he/she resides at
; that he/she is the of
▇▇▇▇▇ & McLennan Companies Inc., the corporation described in and which executed the above instrument
23
In the Matter of ▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ Companies, Inc., et al. Page 24
on behalf of each of the entities listed above; and that he/she signed his/her name thereto by order of
the board of directors of said corporation.
________________________________
Notary Public
THE FOREGOING STIPULATION IS HEREBY APPROVED.
Dated: New York, NY
January , 2005
▇▇▇▇▇▇ ▇▇▇▇▇
Acting Superintendent of Insurance
By: ______________________________
▇▇▇▇▇▇ ▇▇▇▇▇▇
Deputy Superintendent & General Counsel
24
