Exhibit 10.4.1
NATIONAL MARKETING AGREEMENT
This Agreement entered into this 1st day of December, 1997, is made between
Innovative Producers, Inc.("Master General Agent"), a Master General Agent for
Legion Insurance Company ("Company") and Rushmore Insurance Services, Inc.
("National Marketer").
A. DESIGNATION & APPOINTMENT
1. Designation
Innovative Producers, Inc. named above is herein referred to as Master
General Agent, We, Our, or Us. Legion Insurance Company named above is
herein referred to as Company or It. Xxx Xxxxx & Son Administrators, Inc.,
dba Xxxxx Group Services designated administrator for the Company is herein
referred to as Administrator. The National Marketer named above is herein
referred to as National Marketer, You, Your or Yourself. Sub-agents are
agents, brokers, writing agents, or soliciting brokers under Contract with
You and approved by the Company and are herein referred to as Sub-agents.
This National Marketer's Contract and all supplements, amendments, and
schedules attached are referred to as the or this Contract and is entered
into between You and the Master General Agent in consideration for the
mutual agreement set forth herein.
2. Appointment
You are hereby appointed a National Marketer of the Company for the purpose
of soliciting personally or through Sub-agents, applications for insurance
for the Company. This Contract does not grant exclusive rights in any
territory or for any products.
B. RESPONSIBILITIES & LIMITATIONS
1. General
During the continuation of this agreement You agree to:
a. Be responsible for the prompt delivery of Certificates of Insurance
sent to You or Your Sub-agents, in accordance with the Company's
rules and instructions.
b. Follow and cause Your Sub-agents to follow all Company rules and
instructions.
c. Solicit only in the state(s) in which You and Your Sub-agents are
licensed and appointed with the Company and where the Company is
authorized to do business.
d. Comply with all State and Federal laws, orders, rules and
regulations.
e. Be responsible for obtaining and maintaining the necessary licenses
and appointments to solicit the Company's products in the states in
which You operate, whether resident or non-resident, including the
payment of all fees or taxes required by any state or municipal
laws and the renewal thereof.
2. Relationship
Nothing contained herein is intended to create the relationship of employer
and employee between You and the Master General Agent or the Company, and
You shall at all times be an Independent Contractor. You shall be free to
exercise Your own judgement as to the time, place and means of performing
all acts hereunder, but You shall conform to the Company's rules,
regulations and instructions concerning the solicitation and delivery of
insurance polices or certificates.
3. Monies Held in Trust - Bond
All monies You or Your Sub-agents receive or collect for or on behalf of the
Company shall be held in a fiduciary capacity for Its benefit, and shall be
immediately forwarded to the Company. You are not authorized to endorse or
cash checks, drafts or money orders payable to the Company. The Company
reserves the right to require a surety bond or errors and omissions coverage
of an amount satisfactory to the Company.
4. Limits of Authority - Advertising
You are not authorized to waive, alter or change any provision or condition
of the Company's insurance policies or certificates, Sub-agent's Contracts,
literature or receipts; modify or extend the amount of time of any premium
payment due to the Company; or receive any money due or to become due the
Company except initial premiums and/or additional first year premium
collected when a policy or certificate is delivered. You shall not enter
into any Contract, incur any expense or obligation of any character
whatsoever, or cause or permit the insertion or distribution in any
publication or otherwise, any advertising or publicity matter which in any
way involves the Company without the prior written authority of the Company.
You are not to publish, or cause to be published or printed, anything
concerning Its business, nor advertise Its policies or certificates or
services without the Company's prior written approval which will not he
withheld unreasonably. All accounting records maintained by You relating to
Our business are subject to inspection at any reasonable time during
business hours by Our authorized representatives.
5. Applications & Policies
The Company may at Its discretion without liability to You reject
applications or refund premiums for insurance submitted by You or Your Sub-
agents without specifying the cause, and may withdraw, substitute, or change
any insurance policy, certificate, or premium rate used by the Company;
provided, however, that Master General Agent will give National Marketer
notice of any such rejections, withdrawals, substitutions or changes within
5 business days of any such action taken of which Master General Agent has
knowledge. All certificates issued by the Company must be delivered by You
to the certificate holder within ten (10) days of Your receipt and while the
applicant is in good health and premiums have been paid in full.
6. Sub-agent's Contracts
You shall use without alteration Our printed Contracts when Contracting a
Sub-agent. No such Sub-agent Contract shall be in force until: (1.) the
Contract is properly executed by the Sub-agent, (2.) the Sub-agent is
properly licensed to solicit for the Company, and (3.) the Sub-agent is
notified in writing that he/she is authorized to solicit for the Company.
Any Sub-agent appointed by You, and subsequently approved by the Company,
will remain exclusively Your Sub-agent unless You provide the Master General
Agent in writing an authorization for release.
7. Indebtedness
You shall be responsible for the payment to the Company of all monies which:
(1.) You or Your Sub-agents collect on the Company's behalf; (2.) are due to
the Company because of compensation paid to You or Your Sub-agents upon
premiums which the Company thereafter returned; (3.) are paid directly or on
behalf of You or Your Sub-agents which are not due You or Your Sub-agents
under this Contract. Until the Company receives all such monies from You,
the same shall be a debt payable on demand and for which You are liable and
at the Company's option, no commissions are payable to You or Your Sub-
agents until such indebtedness is satisfied.
8. Lien
As additional security for the payment of any indebtedness under this
Contract or any other Contract with the Company, the Company shall have a
first and prior lien against the compensation due You under this Contract.
The Company's lien is superior to all other liens under this contract. The
Company may, at any time, offset any such indebtedness against compensation
due You under the Contract or any Contract You have with the Company. If the
Company does elect to offset, the offset shall not constitute a waiver or an
election by the Company to forego any legal remedies to collect the
indebtedness.
9. Indemnification
Each party hereto shall indemnify, defend, and hold harmless the other party
against claims, actions or liabilities, including judgments, penalties, and
fines, which either party may become obligated to pay as a result of-
(i) the failure of the other party to comply with any law, regulation
or rule of any governmental jurisdiction;
(ii) any grossly negligent or fraudulent act committed by the other
party or its employees causing loss to the third party;
(iii) any breach of this Agreement by the other party but only to the
extent the party seeking indemnification has not by its own
actions, independent of the directives of the other party,
caused, contributed to, or compounded the loss, damage, or
liability for which indemnification is sought.
10. Company Property
Sales brochures, applications, rate cards and booklets, and any other
supplies furnished by the Company, along with any copies thereof, will
remain Company property. They are to be accounted for and returned by You on
demand or termination of this contract. You are to be responsible for any
misuse or i-misrepresentation thereof.
C. COMPENSATION ACCOUNTING
1. Compensation
a. You shall be paid compensation according to the terms of this
Contract as set forth in the attached Exhibit A (which is
incorporated by reference into this Contract) and herein referred
to as Commission Schedule. The Commission Schedule is subject to
change by the Company upon notice in writing to You, but the change
shall not affect any policies, certificates or contracts issued
upon applications You or Your Sub-agents solicited prior to the
effective date of the change. All commissions or other remuneration
earned by Your Sub-agents who are under direct Contract to You,
shall be paid directly by the Administrator to You. The
Administrator shall have no obligation to Your Sub-agent for
payment of commissions. National Marketer agrees to hold the Master
General Agent harmless for all commissions that are earned by Your
Sub-agents and paid directly to you. Comniissions shall accrue and
be paid monthly to You as premiums are received and earned by the
Company.
b. Commissions shall not be owed or paid:
1. On policies or certificates continued in force under any
waiver of premium provision of any policy or certificate; or
2. On collected premiums that are subsequently refunded by the
Company or
3. On policies or certificates issued under a group policy
conversion privilege; or
4. On policies or certificates that are reinstated after forty-
five (45) days from their lapse date.
5. On unearned or unpaid premiums or on extra premiums, premiums
waived, or premium increases.
2. Vested Commissions
a. Subject to the provisions of the Contract, all earned commissions
are immediately and truly vested for life and thereafter to Your
successors and assigns.
b. Any vested commissions forfeited by Your Sub-agents under
Termination For Cause as described in paragraph D.2. shall be
transferred to and payable to You, after the Company has recovered
any indebtedness incurred by said Sub-agent including any License
termination fee imposed by any state or municipal law.
3. Accounting
The Company shall mail to Your last known address as reflected on records or
deliver to You a monthly statement showing compensation and deductions made
within the accounting period. Each statement is deemed to be correct and
accurate unless You object in writing thereto within thirty (30) days after
it has been mailed or delivered. If commissions due You total less than
$50.00 in A calendar month, then commissions payable will be deferred until
accrued commissions exceed $50.00. If the total amount of earned
compensation payable to You during any six (6) consecutive months, in
aggregate, is not at least $200.00, no further compensation shall be payable
to You under this contract. Further, in the event You breach any provision
of this Contract or You are Terminated For Cause under Xxxxxxxxx X.0. of
this Contract, no further compensation shall be payable to You under this
Contract.
D. TERMINATION
1. Termination Without Cause
a. At any time either You or the Master General Agent may terminate
this Contract without Cause by giving one hundred twenty (120) days
notice in writing sent to the last known address of the other. If
You are an individual, this Contract shall immediately terminate
without Cause upon Your death. If You are a partnership, the death
of either partner shall not terminate this Contract but it shall
continue in force and effect in favor of the surviving partner. If
You are a corporation, this Contract shall immediately terminate
upon Your dissolution, sale, bankruptcy or insolvency, or sale, to
the extent such sale was not approved in writing in advance by
Master General Agent (which approval shall not be unreasonably
withheld); provided, however, that any such termination shall not
serve to terminate any vested commissions at the time of such
termination.
b. This Agreement shall terminate in the event of the notification to
the Master General Agent from the Company of the termination of
reinsurance of the Company on business covered by this Agreement
and the failure to replace such reinsurance on terms and conditions
substantially similar to the terms and conditions in the
reinsurance Agreement. The Master General Agent shall give National
Marketer prompt notice of termination of reinsurance, and shall
attempt to give such notice at least 30 days prior to such
termination.
c. Without notice this Contract may be immediately terminated and all
commissions and claims whatsoever accruing hereunder shall be
forfeited and void if You earn less than the required amount of
compensation as stated in Paragraph C.3. of this Contract for any
six (6) consecutive months.
2. Termination For Cause
Without notice this Contract shall immediately terminate for cause and all
commissions and claims whatsoever accruing hereunder shall be forfeited
and void if You:
a. Fail to comply with any provision of this Contract, which failure
is not cured by You within 30 days of notice to You of such
failure.
b. Violate any material law or regulation regarding the sale of
insurance or fail to comply with any court order.
c. Knowingly or intentionally induce or attempt to induce
policyholders or certificateholders of the Company to reduce or
discontinue any premium payment to It.
d. Withhold or convert Company property.
e. Commit any other willful or dishonest act with the intent to injure
the Company.
f. Fail to maintain the necessary licenses and appointments to solicit
the Company's products in the states in which you operate, whether
resident or non-resident, not including any immaterial defect
capable of cure within 30 days.
3. Forfeiture
If this Contract is terminated without cause but the Company discovers that
during Your association with the Company or afterwards that You have
committed any of the acts described in paragraph D. 2., then You shall
forfeit to the Company all right, title and interest in any compensation
under this Contract. A forfeiture under this paragraph shall not constitute
a waiver or an election by the Company to forego any claim It may have
against You.
E. MISCELLANEOUS PROVISIONS
1. Injunction
You agree that if during this Contract or within two years after
termination, You do any of the acts described in paragraph D.2. sub-
paragraphs (c), (d), or (e) of this Contract, that damages, if any, and
remedies at Law for doing such acts would be inadequate. Therefore, in the
event You do any such acts the Company shall be entitled to an injunction,
without the necessity of finishing bond, restraining You from any such act.
You agree that any such act would result in continuing irreparable harm and
damage to the Company, but nothing contained herein shall be construed as
prohibiting the Company from pursuing any other remedies available to It,
including the recovery of damages from You.
2. Assignment & Modification
No assignment of this Contract or any compensation due hereunder shall be
valid unless in writing and approved, in advance, by the Master General
Agent and the Company. No modification of this Contract shall be binding on
the Master General Agent and the Company unless in writing and signed and
approved by the Master General Agent and an authorized Officer of the
Company.
3. Bankruptcy
If You should take or be placed in bankruptcy to the extent of any amount
due the Company under this or any other Contract with the Company, no
compensation shall be payable under this Contract, and such compensation
shall immediately become the Company's property, until and unless all such
amount due the Company shall be recouped by or repaid to the Company in
full.
4. Arbitration; Enforceability; Place of Payment
In consideration of the execution of this Contract and other valuable
considerations, You agree that any controversy or claim arising out of, or
relating to, this Contract, or its breach, shall be settled by arbitration
in Dallas, Texas, in accordance with the rules, then obtaining, of the
American Arbitration Association, and judgement on the award rendered may be
entered in any court having competent jurisdiction. In the event that this
arbitration clause is deemed invalid, illegal, or unenforceable, You agree
that any litigation resulting from the violation of the terms and conditions
of this Contract by You or the Master General Agent or the Company shall be
brought in Dallas County, Texas. This Contract is made subject to the laws
of the State of Texas, and all compensation payable hereunder shall be
payable at Dallas, Texas.
5. Priority; No Waiver; Cumulative Remedies
This Contract supersedes and replaces any Contract or agreement previously
entered into between You and the Master General Agent and the Company with
respect to any future transactions for products sold through the Master
General Agent. However, any rights You and the Company have under any
previous Contract are otherwise unaffected except as expressly provided in
this Contract. Neither any failure nor any delay on the part of the Company
in exercising any right, power or privilege hereunder, nor any course of
dealing between the National Marketer and Company, shall operate as a waiver
thereof; nor shall a single or partial exercise of any right, power or
privilege preclude any other or further exercise thereof or the exercise of
any other right, power or privilege. The remedies provided herein are
cumulative and not exclusive of any remedies provided by law.
6. Severability
In case any one or more of the provisions contained in this Contract should
be invalid, illegal or unenforceable in any respect, the validity, legality
and enforceability of the remaining provisions contained herein shall not in
any way be affected or impaired thereby.
7. Survival of Representations and Warranties
All covenants, representations and warranties made herein shall survive the
execution and delivery hereof and shall continue in full force and effect
during the term of this Agreement and after the termination thereof.
8. Entire Contract
This Contract contains the entire agreement between You and the Master
General Agent. The Contract shall become effective only when first executed
by You and thereafter accepted by the Master General Agent at Dallas, Texas.
9. Effective Date
This Contract becomes effective on the date it is accepted by the Master
General Agent.
NATIONAL MARKETER
Name: Rushmore Insurance Services, Inc.
Address: 650 One Galleria Tower
City: Dallas, Texas Zip: 75240
By: /s/ Xxxxx X. Xxxxx, Xx. 1/26/98
Title:
SPONSORING AGENT
Name: Innovative Producers, Inc.
By: /s/ Xxxx X. Xxxxxx
Innovative Producers, Inc., MASTER GENERAL AGENT
A MEMBER OF THE XXXXX GROUP, INC.
00000 Xxxxx Xx., Xxxxx 000
Xxxxxx, Xxxxx 00000
(000) 000-0000
(000) 000-0000 (Fax)
COMMISSION SCHEDULE
EXHIBIT A
This Commission Schedule, herein referred to as Schedule, is attached to and
made a part of the National Marketing Agreement with Innovative Producers, Inc.
("Master General Agent") and Rushmore Insurance Services, Inc. ("National
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Marketer, You, Your"). The effective date of this Schedule shall be the 1st day
of December, 1997. You shall receive total compensation in the aggregate for
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You and Your Sub-Agents (as defined IN the National Marketing Agreement) in
accordance with the terms of Your National Marketing Agreement and this Schedule
as follows:
COMMISSION
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POLICY FORM A70004:
Year 1 45 %
Year 2 and Later 12 %
Association Dues AND INITIAL Enrollment Fees Are Not Eligible for Commission
