AMENDMENT FIVE TO
MARKETING AGREEMENT
THIS FIFTH AMENDMENT TO THE MARKETING AGREEMENT is 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 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 as follows:
1. The Policy Forms table in APPENDIX A is restated & amended to include new
business Discontinuance Dates as follows. The discontinuance date is the
date which on or after no further applications will be accepted. For the
products earmarked to be withdrawn effective March 3rd, 2003 in the case of
1035 exchanges and other transfers between financial institutions, the
application and completed exchange transfer paperwork must be received by
March 3rd, 2003 and the transferred funds completed by June 6th, 2003 in
order for the policy to be issued.
- ------------------------------------ ------------------------------------ ------------------------------------ ---------------------
PRODUCT NAME POLICY FORM NUMBERS* EFFECTIVE DATES DISCONTINUANCE DATES
- ------------------------------------------------------------------------------------------------------------------------------------
SelectMark(R) Series
- ------------------------------------------------------------------------------------------------------------------------------------
SelectMark(R)5 75/25 T-CTMY0298-5-75/25; 5/29/98 3/3/03
T-PTMY0298-5-7525
- ------------------------------------ ------------------------------------ ------------------------------------ ---------------------
SelectMark(R)7 75/25 T-CMY0799-7-75/25; 10/18/99 3/3/03
T-PMY0799-7-75/25
- ------------------------------------ ------------------------------------ ------------------------------------ ---------------------
SelectMark(R)10 75/25 T-CTMY0298-10-75/25; 5/29/98 3/3/03
T-PTMY0298-10-75/25
- ------------------------------------------------------------------------------------------------------------------------------------
SelectMark(R) Secure Series
- ------------------------------------------------------------------------------------------------------------------------------------
SelectMark(R)5 Secure (formerly T-CTMY0298-5-50/50; 7/10/2000 3/3/03
known as the SelectMark(R)5 50/50) T-PTMY0298-5-50/50 (5/29/98 for
SelectMark(R) 5 50/50)
- ------------------------------------ ------------------------------------ ------------------------------------ ---------------------
SelectMark(R)7 Secure (formerly T-CMY0799-7-50/50; 7/10/2000 3/3/03
known as the SelectMark(R)7 50/50) T-PMY0799-7-50/50 (10/18/99 for SelectMark(R)7 50/50)
- ------------------------------------------------------------------------------------------------------------------------------------
SelectMark(R) Special Edition Series
- ------------------------------------------------------------------------------------------------------------------------------------
Selectmark(R)5 Special Edition T-PSMSE-0801-5 01/02/02 3/3/03
T-CSMSE-0801-5
- ------------------------------------ ------------------------------------ ------------------------------------ ---------------------
SelectMark(R)7 Special Edition T-CMY0799-7-100; 10/18/99 3/3/03
T-PMY0799-7-100
- ------------------------------------ ------------------------------------ ------------------------------------ ---------------------
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- ------------------------------------ ------------------------------------ ------------------------------------ ---------------------
SelectMark(R)7 Special Edition T-CEIA-0500-7 7/26/2000 3/3/03
Equity Index Strategy
- ------------------------------------ ------------------------------------ ------------------------------------ ---------------------
SelectMark(R)10 Special Edition T-CTMY0298-10-50/50; 2/9/99 3/3/03 for all states
(formerly known as the Select T-PTMY0298-10-50/50 5/29/98 for except Florida.
Mark(R)10 50/50) SelectMark(R)10 50/50) 9/1/03 for plan codes
ARIH52 & ARIR52 in
Florida**
- ------------------------------------ ------------------------------------ ------------------------------------ ---------------------
SelectMark(R)10 Special Edition T-CMY1099-10-100; 4/6/2000 3/3/03
with STS T-PMY1099-10-100
- ------------------------------------ ------------------------------------ ------------------------------------ ---------------------
SelectMark(R)10 Special Edition T-CEIA-0500-10; 7/26/2000 3/3/03
Equity Index Strategy T-PEIA-0500-10
- ------------------------------------ ------------------------------------ ------------------------------------ ---------------------
SelectMark(R)10 Special Edition T-CEIA-0500-10STS; 7/26/2000 3/3/03
with STS and Equity Index Strategy T-PEIA-0500-10STS
- ------------------------------------ ------------------------------------ ------------------------------------ ---------------------
Selectmark(R)Special Edition Plus 4 T-C-SMSE-0402-10-4; 04/30/02 9/1/03**
T-P-SMSE-0402-10-4
- ------------------------------------ ------------------------------------ ------------------------------------ ---------------------
Selectmark(R)Special Edition Plus T-C-SMSE-0402-10-0; 05/06/02 3/3/03
T-P-SMSE-0402-10-0
- ------------------------------------------------------------------------------------------------------------------------------------
SelectMark(R) Elite Series
- ------------------------------------------------------------------------------------------------------------------------------------
SelectMark(R)5 Elite T-C390-0701-5; 9/1/01 9/1/03**
T-P390-0701-5
- ------------------------------------ ------------------------------------ ------------------------------------ ---------------------
SelectMark(R)7 Elite T-C390-0701-7; 9/1/01 9/1/03**
T-P390-0701-7
- ------------------------------------ ------------------------------------ ------------------------------------ ---------------------
SelectMark(R)10 Elite T-C390-0701-10; 9/1/01 9/1/03**
T-P390-0701-10
- ------------------------------------------------------------------------------------------------------------------------------------
PreferMark Series
- ------------------------------------------------------------------------------------------------------------------------------------
PreferMark Platinum T-CMY0500-9; 7/26/2000
T-PMY0500-9
- ------------------------------------ ------------------------------------ ------------------------------------ ---------------------
PreferMark Gold T-CMY0500-10; 7/26/2000
T-PMY0500-10
- ------------------------------------------------------------------------------------------------------------------------------------
Riders
- ------------------------------------------------------------------------------------------------------------------------------------
Beneficiary Rider T-CBR-0799; 10/18/99
T-PBR-0799
- ------------------------------------ ------------------------------------ ------------------------------------ ---------------------
Beneficiary Rider Plus T-PBRII-0400;
T-CBRII-0400 7/26/2000
- ------------------------------------ ------------------------------------ ------------------------------------ ---------------------
* Including all State required variations of the above referenced
products/policy form numbers
** Transamerica and LMG may determine that this date may need to be changed
depending on how other product development efforts progress. Any such
change shall be set forth in a separate written agreement or amendment.
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* CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SEC.
2. The Compensation table in APPENDIX B is restated & amended to include new
rates and their effective dates as follows.
All rate changes included in this table are applicable only to applications
received on or after such referenced effective dates.
Compensation to Legacy
-------------------------------------------------------------------------
Age Mandated Commission Reduction (g)
POLICY FORM --------------------------------- LMG Trail
NUMBERS/ (a) (b) (c) (d) (e) (f) Com. (AKA Special
PRODUCT NAME Effective Dates Commis- Comm. % Trail Mkt. Override Administrative Rules
sion Reduces Reduction Allow. Trail Fee or
@ Age Fund One fee)
- ------------------------------------------------------------------------------------------------------------------------------------
SelectMark(R) Series
- -------------------------- ---------------------------------------------------------------------------------------------------------
T-CTMY0298-5-75/25;
SelectMark(R) 5 75/25 T-PTMY0298-5-75/25
Effective 5/29/98 5.00% 85 * * * * *
---------------------------------------------------------------------------------------------------------
Effective 12/1/02 5.00% 85 * * * * *
- -------------------------- ---------------------------------------------------------------------------------------------------------
T-CMY0799-7-75/25;
SelectMark(R) 7 75/25 T-PMY0799-75/25
Effective 10/18/99 7.00% 85 * * * * *
---------------------------------------------------------------------------------------------------------
Effective 12/1/02 7.00% 85 * * * * *
- -------------------------- ---------------------------------------------------------------------------------------------------------
T-CTMY0298-10-75/25;
SelectMark(R) 10 75/25 T-PTMY0298-10-75/25
Effective 5/29/98 8.00% 85 * * * * *
---------------------------------------------------------------------------------------------------------
Effective 12/1/02 8.00% 85 * * * * *
- ------------------------------------------------------------------------------------------------------------------------------------
SelectMark(R) Secure Series
- ------------------------------------------------------------------------------------------------------------------------------------
SelectMark(R) 5 Secure T-CTMY0298-5-50/50;
(formerly known as the T-PTMY0298-5-50/50
SelectMark(R)5 50/50) Effective 7/10/00 4.75% 85 * * * * *
---------------------------------------------------------------------------------------------------------
Effective 12/1/02 4.75% 85 * * * * *
- -------------------------- ---------------------------------------------------------------------------------------------------------
SelectMark(R) 7 Secure T-CMY0799-7-50/50;
(formerly known as the T-PMY0799-7-50/50
SelectMark(R)7 50/50) Effective 7/10/00 6.25% 85 * * * * *
---------------------------------------------------------------------------------------------------------
Effective 12/1/02 6.25% 85 * * * * *
- -------------------------- ---------------------------------------------------------------------------------------------------------
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* CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SEC.
- ------------------------------------------------------------------------------------------------------------------------------------
SelectMark(R) Special Edition Series
- ------------------------------------------------------------------------------------------------------------------------------------
SelectMark(R) 5 Special T-PSMSE-0801-5
Edition T-CSMSE-0801-5
Effective 01/02/02 6.25% 80 * * * * *
---------------------------------------------------------------------------------------------------------
Effective 12/1/02 6.25% 80 * * * * *
- -------------------------- ---------------------------------------------------------------------------------------------------------
SelectMark(R) 7 Special T-CMY0799-7-100;
Edition T-PMY0799-7-100
Effective 10/18/99 8.75% 80 * * * * *
---------------------------------------------------------------------------------------------------------
Effective 12/1/02 8.75% 80 * * * * *
- -------------------------- ---------------------------------------------------------------------------------------------------------
SelectMark(R) 7 Special T-CEIA-0500-7
Edition Equity Index
Strategy Effective 7/26/00 8.75% 80 * * * * *
---------------------------------------------------------------------------------------------------------
Effective 12/1/02 8.75% 80 * * * * *
- -------------------------- ---------------------------------------------------------------------------------------------------------
SelectMark(R) 10 Special T-CTMY0298-10-50/50;
Edition (formerly known T-PTMY0298-10-50/50
as the SelectMark(R) 10
50/50) Effective 2/9/99 10.00% 80 * * * * *
---------------------------------------------------------------------------------------------------------
Effective 12/1/02 10.00% 80 * * * * *
---------------------------------------------------------------------------------------------------------
Effective 1/1/03 9.50% 80 * * * * *
- -------------------------- ---------------------------------------------------------------------------------------------------------
SelectMark(R) 10 Special T-CMY1099-10-100;
Edition with STS T-PMY1099-10-100
Effective 4/6/00 10.00% 80 * * * * *
---------------------------------------------------------------------------------------------------------
Effective 12/1/02 10.00% 80 * * * * *
---------------------------------------------------------------------------------------------------------
Effective 1/2/03 9.50% 80 * * * * *
- -------------------------- ---------------------------------------------------------------------------------------------------------
SelectMark(R) 10 Special T-CEIA-0500-10;
Edition Equity Index T-PEIA-0500-10
Strategy Effective 7/26/00 10.00% 80 * * * * *
---------------------------------------------------------------------------------------------------------
Effective 12/1/02 10.00% 80 * * * * *
---------------------------------------------------------------------------------------------------------
Effective 1/2/03 9.50% 80 * * * * *
- -------------------------- ---------------------------------------------------------------------------------------------------------
SelectMark(R) 10 Special T-CEIA-0500-10STS;
Edition with STS and T-PEIA-0500-10STS
Equity Index Strategy Effective 7/26/00 10.00% 80 * * * * *
---------------------------------------------------------------------------------------------------------
Effective 12/1/02 10.00% 80 * * * * *
---------------------------------------------------------------------------------------------------------
Effective 1/2/03 9.50% 80 * * * * *
- -------------------------- ---------------------------------------------------------------------------------------------------------
SelectMark(R) Special T-C-SMSE-0402-10-0;
Edition Plus T-P-SMSE-0402-10-0
Effective 5/6/02 10.00% 80 * * * * *
---------------------------------------------------------------------------------------------------------
Effective 12/1/02 10.00% 80 * * * * *
---------------------------------------------------------------------------------------------------------
Effective 1/2/03 9.50% 80 * * * * *
- -------------------------- ---------------------------------------------------------------------------------------------------------
SelectMark(R) Special T-C-SMSE-0402-10-4;
Edition Plus 4 T-P-SMSE-0402-10-4
Effective 4/30/02 8.50% 80 * * * * *
(+0.25%
bonus)
---------------------------------------------------------------------------------------------------------
Effective 12/1/02 9.00% 80 * * * * *
- -------------------------- ---------------------------------------------------------------------------------------------------------
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* CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SEC.
- ------------------------------------------------------------------------------------------------------------------------------------
SelectMark(R) Elite Series
- -------------------------- ---------------------------------------------------------------------------------------------------------
SelectMark(R) 5 Elite T-C390-0701-5;
T-P390-0701-5
Effective 9/1/01 8.00% 85 * * * * *
---------------------------------------------------------------------------------------------------------
Effective 12/1/02 8.00% 85 * * * * *
- -------------------------- ---------------------------------------------------------------------------------------------------------
SelectMark(R) 7 Elite T-C390-0701-7;
T-P390-0701-7
Effective 9/1/01 9.50% 85 * * * * *
---------------------------------------------------------------------------------------------------------
Effective 12/1/02 9.50% 85 * * * * *
- -------------------------- ---------------------------------------------------------------------------------------------------------
SelectMark(R) 10 Elite T-C390-0701-10;
T-P390-0701-10
Effective 9/1/01 11.00% 85 * * * * *
---------------------------------------------------------------------------------------------------------
Effective 12/1/02 11.00% 85 * * * * *
- -------------------------- ---------------------------------------------------------------------------------------------------------
PreferMark Series
- -------------------------- ---------------------------------------------------------------------------------------------------------
PreferMark Platinum Y-CMY0500--9; Age-mandated
T-PMY0500-9 commission
reduction also
applies to
Effective 7/26/00 7.50% 85 * * * * * override
---------------------------------------------------------------------------------------------------------
Effective 12/1/02 7.50% 85 * * * * *
No Change
- -------------------------- ---------------------------------------------------------------------------------------------------------
PreferMark Gold T-CMY0500-10; Age-mandated
T-PMY0500-10 commission
reduction also
applies to
Effective 7/26/00 3.00% 85 * * * * * override
---------------------------------------------------------------------------------------------------------
Effective 12/1/02 3.00% 85 * * * * *
No Change
- -------------------------- ---------------------------------------------------------------------------------------------------------
3. The General Compensation Rules are amended & restated as follows:
GENERAL COMPENSATION RULES
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:
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* CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SEC.
(1) *% of all premiums received on or before August 31, 2001 by LMG for the
SelectMark(R) 10 Special Edition (for premiums received after October 18,
1999), SelectMark(R) 10 Special Edition Equity Index Strategy,
SelectMark(R) 10 STS Special Edition Equity Index Strategy and
SelectMark(R) 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 and Voluntary Trail Selection 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(R) Special Edition products) and 84 for other
products, or voluntary trail compensation is selected. The *% additional
commission payable for the SelectMark(R) 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 or voluntary trail
compensation is selected, base commissions are reduced by *%. A trail base
commission is paid monthly beginning in policy year 2. Column (d) reflects
the trail base commission 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.
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* CONFIDENTIAL INFORMATION HAS BEEN OMITTED AND FILED SEPARATELY WITH THE SEC.
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 or voluntary trail compensation is selected,
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 the annual rate shown in column (g) above, paid
monthly, 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.
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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 Agreement.
LEGACY MARKETING GROUP TRANSAMERICA LIFE INSURANCE AND ANNUITY COMPANY
By: /s/ Don Dady By: /s/ Ken Kilbane
Title: VP of Marketing Title: VP Legacy Marketing Sales
Date: May 6, 2003 Date: May 7, 2003
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