Document:

ex10-5

 

EXHIBIT 10.5

Amendment No. 3 to

Marketing Agreement

THIS THIRD AMENDMENT TO THE MARKETING AGREEMENT is entered into this 29th day
of October, 2001, and effective as indicated herein, by and between
TRANSAMERICA LIFE INSURANCE AND ANNUITY COMPANY, hereinafter referred to as
“Transamerica,” a North Carolina corporation, and LEGACY MARKETING GROUP,
hereinafter referred to as “LMG,” a California corporation.

WHEREAS, Transamerica and LMG entered into a Marketing Agreement, dated May 29,
1998, as amended, hereinafter referred to as the “Agreement,” wherein
Transamerica and LMG agreed to jointly develop proprietary annuity products,
wherein LMG would market such products on behalf of Transamerica, utilizing its
nationwide distribution channels of duly licensed and appointed Producers in
consideration of the compensation as set forth in Appendix B of the Agreement.

NOW, THEREFORE, in consideration of the foregoing recitals and mutual promises
hereinafter contained and other good and valuable consideration, the parties
hereto do agree to amend the Agreement as follows:

	1.	 	Appendix A, attached hereto, is restated in its entirety as of September
1, 2001.
	 
	2.	 	Appendix B, attached hereto, is restated in its entirety as of September
1, 2001.
	 
	3.	 	Appendix D, “Schedule of Authorized Personnel,” is hereby restated in its
entirety as of October 29, 2001 to read as follows:

     “Representing Transamerica

     *

     *

     *

	 
	Representing Legacy Marketing Group
	

	 
	Lynda L. Regan, Chief Executive Officer
	R. Preston Pitts, President
	Steve Taylor, Chief Financial Officer
	H. Lynn Stafford, Chief Information Officer
	Niju Vaswani, Vice President of Distribution
	Bill Hrabik, Chief Operation Officer
	Andy Chua, Vice President of Product Development
	Don Dady, Vice-President of Marketing”

1

 

	4.	 	All other provisions in the Agreement not specifically amended above
remain in effect and unchanged.

IN WITNESS HEREOF, the parties have hereto executed this Amendment No. 3.

	 	 	 
	LEGACY MARKETING GROUP	 	
TRANSAMERICA LIFE INSURANCE AND ANNUITY COMPANY
	 
	 
	By:     /s/ Don Dady

Title:  Vice President

Date:  November 5, 2001

	 	
By:     /s/ Karen MacDonald

Title:  Senior Vice President

Date:  October 29, 2001

2

 

APPENDIX A

MARKETING AGREEMENT

September 1, 2001

GEOGRAPHIC TERRITORY:

All states (except New York, Hawaii and Alabama) and the District of Columbia

POLICY FORMS

	 	 	 	 	 
	PRODUCT NAME	 	POLICY FORM NUMBERS	 	Effective Dates
	
	 	
	 	

	 
	SelectMark® Series	 	 	 	 
	SelectMark®5 75/25	 	
*
	 	*
	SelectMark® 7 75/25	 	
*
	 	*
	SelectMark® 10 75/25	 	
*
	 	*
	 
	SelectMark® Secure Series	 	 	 	 
	SelectMark® 5 Secure (formerly known as the	 	 	 	 
	SelectMark® 5 50/50)	 	
*
	 	*
	SelectMark® 7 Secure (formerly known as the	 	 	 	 
	SelectMark® 7 50/50)	 	
*
	 	*
	 
	SelectMark® Special Edition Series	 	 	 	 
	Selectmark® 5 Special Edition	 	
*
	 	*
	SelectMark® 7 Special Edition	 	
*
	 	*
	SelectMark® 7 Special Edition Equity Index Strategy	 	
*
	 	*
	SelectMark® 10 Special Edition (formerly known as	 	 	 	 
	the Select Mark® 10 50/50)	 	
*
	 	*
	SelectMark® 10 Special Edition with STS	 	
*
	 	*
	SelectMark® 10 Special Edition Equity Index	 	 	 	 
	Strategy	 	
*
	 	*
	SelectMark® 10 Special Edition with STS and	 	 	 	 
	Equity Index Strategy	 	
*
	 	*
	 
	SelectMark® Elite Series	 	 	 	 
	SelectMark® 5 Elite	 	
*
	 	*
	SelectMark® 7 Elite	 	
*
	 	*
	SelectMark® 10 Elite	 	
*
	 	*
	 
	PreferMark Series	 	 	 	 
	PreferMark Platinum	 	
*
	 	*
	PreferMark Gold	 	
*
	 	*
	 
	Riders	 	 	 	 
	Beneficiary Rider	 	
*
	 	*
	Beneficiary Rider Plus	 	
*
	 	*

1

 

State required variations of the above referenced products/policy form numbers
may be required.

“Unique Features”

The ‘Unique” features contained in the policy forms that would preclude LMG
from separately selling or marketing any products which are the same as those
unique products co-developed by LMG and Transamerica are as follows:

     The Total Return Crediting Rate Strategy in combination with the Multiple
Year Crediting Rate Strategy in a fixed annuity.

The ‘Unique” features contained in the policy forms that would preclude
Transamerica from separately selling or marketing any products which are the
same as those unique products co-developed by LMG and Transamerica are as
follows:

     The Total Return Crediting Rate Strategy in combination with the Multiple
Year Crediting Rate Strategy in a fixed annuity.

The features described above as the “ Total Return Crediting Rate Strategy” and
“Multiple Year Crediting Rate Strategy” are described in the policy forms
listed in this Appendix A under the caption or headings “Total Return Strategy”
and “Multiple Year Strategy.”

2

 

Appendix B

MARKETING AGREEMENT

COMPENSATION

September 1, 2001

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	Compensation to Legacy	 	 	 	 	 	 
	 	 	 	 	
	 	 	 	 	 	 
	 	 	 	 	 	 	Age Mandated Commission Reduction	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	
	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	(b)	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Comm.	 	 	 	 	 	 	 	 	 	(g)	 	 	 	 	 	 
	 	 	POLICY FORM NUMBERS/	 	(a)	 	Reduces	 	(c)	 	(d)	 	(e)	 	(f)	 	LMG Trail	 	 	 	 	 	 
	PRODUCT NAME	 	Effective Dates	 	Commission	 	@ Age	 	% Reduction	 	Trail	 	Mkt. Allow.	 	Override	 	Com.	 	Special Rules	 	 	 	 
	
	 	
	 	
	 	
	 	
	 	
	 	
	 	
	 	
	 	
	 	 	 	 
	SelectMark® Series	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	SelectMark® 5 75/25	 	
*
	 	*
	 	*
	 	*
	 	*
	 	*
	 	*
	 	*	 	 
	SelectMark® 7 75/25	 	
*
	 	*
	 	*
	 	*
	 	*
	 	*
	 	*
	 	*	 	 
	SelectMark® 10 75/25	 	
*
	 	*
	 	*
	 	*
	 	*
	 	*
	 	*
	 	*	 	 
	SelectMark® Secure Series	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	SelectMark® 5 Secure	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	(formerly known as the	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	SelectMark® 5 50/50)	 	
*
	 	*
	 	*
	 	*
	 	*
	 	*
	 	*
	 	*	 	 
	SelectMark® 7 Secure	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	(formerly known as the	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	SelectMark® 7 50/50)	 	
*
	 	*
	 	*
	 	*
	 	*
	 	*
	 	*
	 	*	 	 
	SelectMark® Special	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Edition Series	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	SelectMark® 5 Special	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Edition	 	
*
	 	*
	 	*
	 	*
	 	*
	 	*
	 	*
	 	*	 	 
	SelectMark® 7 Special	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Edition	 	
*
	 	*
	 	*
	 	*
	 	*
	 	*
	 	*
	 	*	 	 

1

 

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	Compensation to Legacy	 	 	 	 	 	 
	 	 	 	 	
	 	 	 	 	 	 
	 	 	 	 	 	 	Age Mandated Commission Reduction	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	
	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	(b)	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	Comm.	 	 	 	 	 	 	 	 	 	(g)	 	 	 	 	 	 
	 	 	POLICY FORM NUMBERS/	 	(a)	 	Reduces	 	(c)	 	(d)	 	(e)	 	(f)	 	LMG Trail	 	 	 	 	 	 
	PRODUCT NAME	 	Effective Dates	 	Commission	 	@ Age	 	% Reduction	 	Trail	 	Mkt. Allow.	 	Override	 	Com.	 	Special Rules	 	 	 	 
	
	 	
	 	
	 	
	 	
	 	
	 	
	 	
	 	
	 	
	 	 	 	 
	SelectMark® 7 Special	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Edition Equity Index	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Strategy	 	
*
	 	*
	 	*
	 	*
	 	*
	 	*
	 	*
	 	*	 	 
	SelectMark® 10 Special	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Edition (formerly known	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	as the SelectMark® 10	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	50/50)	 	
*
	 	*
	 	*
	 	*
	 	*
	 	*
	 	*
	 	*	 	 
	SelectMark® 10 Special	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Edition with STS	 	
*
	 	*
	 	*
	 	*
	 	*
	 	*
	 	*
	 	*	 	 
	SelectMark® 10 Special	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Edition Equity Index	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Strategy	 	
*
	 	*
	 	*
	 	*
	 	*
	 	*
	 	*
	 	*	 	 
	SelectMark® 10 Special	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Edition with STS and	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Equity Index Strategy	 	
*
	 	*
	 	*
	 	*
	 	*
	 	*
	 	*
	 	*	 	 
	SelectMark® Elite Series	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	SelectMark® 5 Elite	 	
*
	 	*
	 	*
	 	*
	 	*
	 	*
	 	*
	 	*	 	 
	SelectMark® 7 Elite	 	
*
	 	*
	 	*
	 	*
	 	*
	 	*
	 	*
	 	*	 	 
	SelectMark® 10 Elite	 	
*
	 	*
	 	*
	 	*
	 	*
	 	*
	 	*
	 	*	 	 
	PreferMark Series	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	PreferMark Platinum	 	
*
	 	*
	 	*
	 	*
	 	*
	 	*
	 	*
	 	*
	 	*
	PreferMark Gold	 	
*
	 	*
	 	*
	 	*
	 	*
	 	*
	 	*
	 	*
	 	*

GENERAL COMPENSATION RULES

2

 

1. Base Commission (Column (a) above):

		
	 	Transamerica will pay LMG on the last business day of the week base
commissions for all premiums received in cash by LMG during that week, i.e.,
the prior Friday through Thursday, in the specified percentages indicated in
Column (a) above. Such commissions will be paid by Transamerica to LMG by
Transamerica authorizing LMG to write a check to itself against the
Transamerica Disbursement account for the total weekly commission amount.
	 
	 	Additional premiums will be subject to the same base commission percentages
noted above as the initial premium.

		
	 	In addition to the base commission rates specified in Column (a) above
Transamerica will pay LMG an additional commission as follows:

        

		
	 	
(1) * of all premiums received on or before August 31, 2001 by LMG for the
SelectMark® 10 Special Edition (for premiums received after October 18,
1999), SelectMark® 10 Special Edition Equity Index Strategy, SelectMark® 10
STS Special Edition Equity Index Strategy and SelectMark® 10 Special
Edition with STS products for applications received by Legacy for such
products on or before August 31, 2001, and in the case of 1035 exchanges
and other transfers between financial institutions, the application and
completed exchange/transfer paperwork must be received by LMG by August 31,
2001 and the cash received by November 30, 2001 for Transamerica to pay the
extra * bonus.

	 	
(2) * of all premiums received during the period September 1, 2001 and
September 30, 2001 for such products for applications received by LMG for
such products. In the case of 1035 exchanges and other transfers between
financial institutions, the application and completed exchange/transfer
paperwork must be received by LMG between September 1 and September 30th
and the cash received by November 30, 2001 for Transamerica to pay the
extra * bonus.

		
	 	Note: As a practical matter, LMG’s administrative system will treat
additional deposits on inforce policies in the same manner as cash received
on 1035 exchanges and other transfers with respect to the above rules.
Transamerica agrees to this treatment on additional deposits based on (1)
LMG’s representation that additional deposits will not be material and (2)
LMG’s agreement that this treatment on additional deposits will not be
disclosed in any manner to producers or policyholders. LMG also agrees to
limit disclosure of this treatment on additional deposits to LMG employees on
a “need to know” basis.

2. Age Mandated Commission Reduction (Columns (b), (c) and (d) above):

		
	 	The following provision applies to payment of all base commissions for all
products subject to this Agreement (see below for separate rules for
PreferMark Gold and PreferMark Platinum) if the issue age is greater than 79
(in the case of SelectMark® Special Edition products) and 84 for other
products. The * additional commission payable for the SelectMark® 10 series
products is considered part of the base commission.
	 
	 	If the issue age is greater than 79 or 84 as defined in the Death Benefit
Proceeds provision of the applicable policy form, base commissions are
reduced by *. A trail base commission is paid monthly beginning in policy
year 2. Column (d) reflects the trail base commission

3

 

		
	 	percentage on an annual basis (calculated as Column (a) multiplied by the
percentage in Column (c) divided by 10). This trail base commission is paid
monthly (the payable amount, calculated each month, is the Column (d) annual
percentage divided by 12 and multiplied by the annuity cash value). The
monthly trail base commission continues to be paid until death of the
annuitant, surrender of the policy or election of a settlement option.

		
	 	With regard to PreferMark Gold and PreferMark Platinum, if the issue age of a
policy is greater than 84 as defined in the Death Benefit Proceeds provision
of such policy form the applicable base commission percentage is reduced by *
for all premiums received for that policy. No monthly trail commission is
payable.

3. Marketing Allowance (Column (e) above):

		
	 	Transamerica will pay to LMG a Marketing Allowance for all premiums received
by LMG in the specified percentages indicated in Column (e) above. LMG will
bill Transamerica weekly and Transamerica will pay LMG such Marketing
Allowance by wire transfer within five (5) business days of receipt of such
documentation.

4. Override Commission (Column (f) above):

		
	 	Transamerica will pay to LMG an override commission (on the last business day
of the week) for all premiums received by LMG during that week, in the
specified percentages indicated in Column (f) above.
	 
	 	The override commission percentages in Column (f) include * which is paid
back to Transamerica by LMG at the end of each fiscal year (for this purpose
each fiscal year begins on August 1 and ends on the following July 31) for
the first * of aggregate premium received by LMG during that fiscal year for
all (excluding PreferMark Gold and PreferMark Platinum) products (net of
premiums returned to policyholders under free look provisions if the
aggregate premium received by LMG for the fiscal year is less than *). LMG
will retain the * on all premiums received in excess of * in each fiscal
year. Notwithstanding the foregoing, LMG’s obligation to pay Transamerica
the aforementioned * shall terminate upon LMG’s final payment of * for the
fiscal year ending July 31, 2001.
	 
	 	With regard to PreferMark Gold and PreferMark Platinum, if the issue age of a
policy is greater than 84 as defined in the Death Benefit Proceeds provision
of such policy form the applicable override commission percentage is reduced
by * for all premiums received for that policy.

5. LMG Trail Commission (Column (g) above):

		
	 	Transamerica will pay LMG an annual rate, paid monthly, of * of the total
Annuity Cash Value of the policies sold under this Agreement. For the
purpose of the foregoing, Annuity Cash Value is the contract’s Cash Value
which reflects any applicable reductions, loans and withdrawals. The
commission is based on the total month end Annuity Cash Value and will be
paid within six (6) business days of month end by Transamerica via wire
transfer to an LMG bank account.

4ex10-6

 

EXHIBIT 10.6

Amendment No. 4 To

Administrative Services Agreement

THIS FOURTH AMENDMENT TO THE ADMINISTRATIVE SERVICES AGREEMENT is entered into
this 29th day of October, 2001, and effective as indicated herein, by and
between TRANSAMERICA LIFE INSURANCE AND ANNUITY COMPANY, hereinafter referred
to as “Transamerica,” a North Carolina corporation, and LEGACY MARKETING GROUP,
hereinafter referred to as “LMG,” a California corporation.

WHEREAS, Transamerica and LMG entered into an Administrative Services
Agreement, dated May 29, 1998, as amended, hereinafter referred to as the
“Agreement,” wherein LMG agreed to provide certain Transamerica accounting and
service functions in consideration of the fees as set forth in Appendix B of
the Agreement.

NOW, THEREFORE, in consideration of the foregoing recitals and mutual promises
hereinafter contained and other good and valuable consideration, the parties
hereto do agree to amend the Agreement as follows:

	 	1.	 	Appendix A, attached hereto, is restated in its entirety as of
September 1, 2001.
	 
	 	2.	 	Appendix D, “Schedule of Authorized Personnel” is hereby amended
with repect to Transamerica personnel effective October 29, 2001 as follows:

		
	 	     “Representing Transamerica
	 
	 	     Authorized to modify this Agreement:
	 	          *
	 	          *
	 	          *
	 
	 	     Authorized to provide day to day direction of LMG employees for policies
and items not specifically covered in this agreement:
	 	          *
	 	          *
	 	          *

	 	2.	 	All other provisions in the Agreement not specifically amended above
remain in effect and unchanged.

IN WITNESS HEREOF, the parties have hereto executed this Amendment No. 4.

LEGACY MARKETING GROUP

By: /s/ Don Dady

Title: Vice President

Date: November 5, 2001

TRANSAMERICA LIFE INSURANCE AND ANNUITY COMPANY

By: /s/ Karen MacDonald

Title: Senior Vice President

Date: October 29, 2001

1

 

APPENDIX A

ADMINISTRATIVE SERVICES AGREEMENT

September 1, 2001

GEOGRAPHIC TERRITORY:

     All states (except New York, Hawaii and Alabama) and the District of Columbia

POLICY FORMS

	 	 	 	 	 
	PRODUCT NAME	 	POLICY FORM NUMBERS	 	Effective Dates
	
	 	
	 	

	 
	SelectMark® Series	 	 	 	 
	SelectMark®5 75/25	 	
*
	 	*
	SelectMark® 7 75/25	 	
*
	 	*
	SelectMark® 10 75/25	 	
*
	 	*
	 
	SelectMark® Secure Series	 	 	 	 
	SelectMark® 5 Secure (formerly known as the	 	 	 	 
	SelectMark® 5 50/50)	 	
*
	 	*
	SelectMark® 7 Secure (formerly known as the	 	 	 	 
	SelectMark® 7 50/50)	 	
*
	 	*
	 
	SelectMark® Special Edition Series	 	 	 	 
	Selectmark® 5 Special Edition	 	
*
	 	*
	SelectMark® 7 Special Edition	 	
*
	 	*
	SelectMark® 7 Special Edition Equity Index Strategy	 	
*
	 	*
	SelectMark® 10 Special Edition (formerly known as	 	 	 	 
	the Select Mark® 10 50/50)	 	
*
	 	*
	SelectMark® 10 Special Edition with STS	 	
*
	 	*
	SelectMark® 10 Special Edition Equity Index	 	 	 	 
	Strategy	 	
*
	 	*
	SelectMark® 10 Special Edition with STS and	 	 	 	 
	Equity Index Strategy	 	
*
	 	*
	 
	SelectMark® Elite Series	 	 	 	 
	SelectMark® 5 Elite	 	
*
	 	*
	SelectMark® 7 Elite	 	
*
	 	*
	SelectMark® 10 Elite	 	
*
	 	*
	 
	PreferMark Series	 	 	 	 
	PreferMark Platinum	 	
*
	 	*
	PreferMark Gold	 	
*
	 	*
	 
	Riders	 	 	 	 
	Beneficiary Rider	 	
*
	 	*
	Beneficiary Rider Plus	 	
*
	 	*

     State required variations of the above referenced products/policy form numbers
may be required.

2

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