PRODUCER AGREEMENT
This agreement ("Agreement") is made by and between Fringe Benefit Analysts
("Producer") and PacifiCare of Utah, Inc. and PacifiCare Health Option. Inc.
("PacifiCare"), to be effective on November 1, 1998 , for the provision of sales
and related services and consists of this data and signature page and the
following exhibits which are attached and incorporated into the Agreement:
1. EXHIBIT 1 - TERMS AND CONDITIONS
2. EXHIBIT 2 - COMPANY PRODUCTS AND TERRITORIES
3. EXHIBIT 3 - COMMISSION SCHEDULE(S).
PRODUCER INFORMATION:
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Mailing Address City State Zip
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Telephone Number Fax Number
3778 ▇▇-▇▇▇▇▇▇▇
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License - Type and Number Tax ID Number or SS Number
(attach copy of current license)
Affinity Insurance Services (NALU) NAL - 25462
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Errors & Omissions Carrier
(attach copy of current policy)
IN WITNESS WHEREOF, THE PARTIES HAVE AGREED TO THE EXECUTION OF THIS AGREEMENT,
AS MORE FULLY DESCRIBED ABOVE, BY THEIR SIGNATURES BELOW;
PRODUCER: PACIFICARE:
Fringe Benefit Analysts
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Producer Name (print or type) Representative (print or type)
/s/ ▇▇▇▇▇ ▇. ▇▇▇▇, Manager
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Signature Signature
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Corporate Name (if applicable) Title
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Corporate Officer and Title Date
(if applicable)
November 3, 1998
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Date
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Producer Number
(Assigned by PacifiCare)
/s/ SD
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(Initials)
1
EXHIBIT 1
TERMS AND CONDITIONS
ARTICLE I. OBLIGATIONS OF PRODUCER
1.1 Performance of Agreement Generally. Producer shall use its best erfons
to solicit appiications for the PacifiCare Plan(sJ designated on Exhibit
2 hereto from groups/employers/individuals within PacifiCare's service
area. In order to comply with applicable federal and stale regulations.
Producer wiil perform as set forth in this Agreement and as set forth in
PacifiCare administrative guidelines, bulletins, directives, manuals and
the like. as PacifiCare may publish from time to time. ail of which are
incorporated herein by reference. Producer agrees that in performing
under this Agreement, Producer shall act in the best interests of
PacifiCare and its clients.
1.2 Producer Services. Producer will service PacifiCare Plan members
enrolled through applications submitted by Producer. Such service will
include but not be limited to the following:
(a) Acting as a liaison between the member and PacifiCare if requested
by PacifiCare or the member including, but not limited to, the
following: Assisting the member to take the proper action in
connection with PacifiCare coverage when there is a change of
address, change in marital status or change in dependent status and
assisting a family member/dependent to obtain coverage when he or
she is no longer entitled to coverage as a family member, e.g.,
when a dependent child reaches the limiting age, or upon divorce.
(b) Maintaining a working and current knowledge of the PacifiCare
P!an(s) designated on Exhibit 2 and the ability to explain the
benefits and/or coverage.
1.3 Licensure. Producer shall comply with all applicable licensing
requirements required to transact its business and shall provide
PacifiCare with copies of its license upon the signing of this Agreement
and promptly upon each renewal of said license, thereafter. Producer
shall promptly notify PacifiCare of any expiration, termination,
suspension or other action of the Department of Insurance or any other
applicable regulatory/licensing body affecting the Producer's license or
the licenses of Producer's principal persons or employees. Producer
warrants that his/her license has not previously been subject to any
suspension, termination or other disciplinary action by any
government/regulatory authority and that Producer has never been
convicted of a felony or a misdemeanor involving theft or
misappropriation of monies.
1.4 Submission of Application for Coverage. Producer agrees to comply with
all of the rules and regulations of PacifiCare in regard to the
completion and submission of applications and to make no representation
with respect to the benefits of any PacifiCare Plan or about PacifiCare
not in conformity with the material prepared and furnished to Producer
for that purpose by PacifiCare. Producer will not make any misleading or
deceptive statement and will explain all relevant facts in dealing with
prospective and current members and groups. Producer will use his/her
best efforts to ensure that each application is fully and truthfully
completed by the applicant and the completed application fully and
accurately discloses the circumstances, including, where applicable, the
health of persons for whom coverage is sought in the application.
Producer further agrees to inform every applicant that PacifiCare will
reiy upon these heaith representations in the underwriting process, and
that the subsequent discovery of material may result in the rescission
or termination of any c()ntract entered into by PacifiCare, and that in
no event will Ac applicant have any coverage unie- o' o'- reviewed and
approved by PacifiCare.
/s/ SD
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(Initials)
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1.5 Limits of authority Producer is not authorized to. and agrees not to.
enter into. alter, deliver, replace, rescind, or terminate any contract
on behalf of PacifiCare. nor to extend time for payment, make
settlement, or refund membership premiums or any other charges or bind
PacifiCare in any way without the prior written approval of PacifiCare.
Producer further agrees that PacifiCare reserves the right to reject any
and all applications submitted by Producer.
1.6 Handling of Funds. If the Producer receives funds for the account of
Company, these funds shall not be deposited by the Producer into any
banK account, but shall be remitted to Company within five (5) business
days after such funds are received by the Producer. Such funds shall be
held by the Producer in a fiduciary capacity for Company and shall at
all times be segregated from the assets of the Producer.
1.7 Maintenance of Records. Producer agrees to maintain complete records of
all transactions pertaining to applications submitted to and accepted by
PacifiCare and its business relationship with PacifiCare for a minimum
of five (5) years or as required by any governmentai entity or any law
or regulation. Any and all records described above or as may otherwise
relate to Producer's activities in connection with PacifiCare shall be
accessible and available to representatives of PacifiCare who may review
and/or audit and from time to time when this Agreement is in effect and
for a period of one (1) year after the termination of this Agreement.
1.8 Limits on Compensation. Producer shall seek compensation for performing
under this Agreement only from PacifiCare and shall under no
circumstances charge prospective or current members or groups any
application, processing or other broker, analyst or consultant fee
related to the performance of Producer's obligations hereunder. Producer
shall under no circumstances attempt to collect from a PacifiCare member
any sums owed by PacifiCare.
1.9 Insurance. Producer agrees to obtain and maintain in force errors and
omissions insurance in an amount of not less than 51,000,000 per
occurrence and in the aggregate at Producer's own expense and shall
provide evidence of such coverage to PacifiCare upon request. Producer
shall provide PacifiCare with thirty (30) days prior written notice of
cancellation of such insurance or of a reduction in coverage which does
not meet the above minimum requirements. Failure to obtain and maintain
this insurance satisfactory to PacifiCare. shall be a material failure
to comply with a provision of this Agreement and cause for immediate
termination by PacifiCare.
1.10 Modification of Programs. Notwithstanding any other provision in this
Agreement, Producer agrees that PacifiCare has the right to discontinue
or modify, or exercise any and all lawful rights it has in connection
with any PacifiCare Plans or programs, without incurring any liability
to Producer.
1.11 Indemnification. Producer agrees to indemnify and hold harmless
PacifiCare, its parent, subsidiaries and affiliates, their boards of
directors, officers, agents, successors, employees and assigns, from and
against any and all claims, liabilities, demands, actions, causes of
action, judgements, debts, damages and expenses (including attorneys'
fees) arising from the action of Producer or its agents or
representatives. This paragraph shall survive the termination of this
Agreement.
/s/ SD
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3
1.12 Trade Secrets. Producer agrees to maintain the confidentiality of -iny
trade secrets or proprietary information obtained or learned from
PacifiCare and not to use such trade secrets or proprietary information
for its benefit or the benefit of others except as specifically
authorized herein. Producer acknowledges and agrees that the leads,
presentation manuals, training and recruiting videos, member lists and
other lists which PacifiCare may from time to time provide Producer, are
confidential and proprietary to PacifiCare. Producer's obligations under
this paragraph shall survive termination of this Agreement.
1-13 Exercise of Authority. Producer shall not possess or exercise any
authority on behalf of PacifiCare other than that expressly conferred by
this Agreement.
1.14 Non-Discrimination. Producer agrees to render the services contemplated
herein without regard to race, sex. religion, creed, color, national
origin or ancestry of any ofPacifiCare's potential or actual members.
1.15 Information Session. Producer will attend, at Producer's sole expense,
at least one PacifiCare sponsored producer information session each
calendar year to be held in the county in which Producer resides.
1.16 Product Sales Limitation. Producer may seil only those products
specifically authorized and designated on Exhibit 2 hereto. Producer is
not authorized to solicit any other PacifiCare products under this
Agreement.
1.17 Delegation Restriction. Producer shall not delegate any agents to
solicit applications for the PacifiCare PIan(s) or to service PacifiCare
Plan members without the prior express written consent of PacifiCare.
ARTICLE II. OBLIGATIONS OF PACIFICARE
2.1 Commissions. PacifiCare will pay Producer first year and renewal
commissions on a PacifiCare enrollment resulting from applications for
the PacifiCare Plants) that are obtained by Producer and accepted by
PacifiCare. Such commissions shall be based on the commission
schedule(s) attached to this Agreement as Exhibit 3 and incorporated
herein and shall be paid on membership premiums actually received by
PacifiCare for the enrollments produced by Producer. Payment shall be as
set forth in this paragraph. Notwithstanding any other provision of this
Agreement, PacifiCare may modify or replace its commission scheduie(s)
on thirty (30) days prior written notice to Producer, and such modified
or replacement schedule(s) shall apply to all enrollments effective
following the effective date of such modification or replacement.
2.2 Renewal Commissions. Renewal commissions shall be payable to Producer by
PacifiCare, as provided under Section 2.3 hereof (i) as long as
PacifiCare retains the enrollment produced by Producer (such retention
being at PacifiCare's option); and (ii) as long as PacifiCare has a
valid broker of record letter naming Producer as the representative of
the employer group, except that renewal commissions will be paid after
the fifth year only so long as this Agreement is still in effect. In the
event the employer group notifies PacifiCare that it intends to
discontinue or change its broker of record, PacifiCare will cease its
payment of commission, with or without notice to the Producer, as of the
last day of the month in which PacifiCare is notified by the employer
group.
/s/ SD
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(Initials)
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2.3 Payment of Commissions. PacinCare wiil pay Producer compensation due
within thirty (30) days following the end of each calendar monm based on
membership premiums actually received, earned and reconciled by
PacifiCare auring the calendar month for Producer generated business,
except that PacifiCare reserves the right to accumulate commissions
until commissions due Producer equal at least twenty-five dollars
($25.00). If there is a return of membershio premiums on Producer
generated business, for any reason. PacifiCare will charge back to
Producer the amount of commission previously paid to Producer on the
amount or returned membership premiums.
2.4 Loss of Commissions. No further commissions shall be payable to Producer
should this Agreement be terminated for cause pursuant to Section 3.3.
Additionally, no further commissions shall be payable if:
a. Producer fails to immediately remit to PacinCare any funds received
on behalf of PacinCare; or
b. Producer shall be indebted to PacinCare for more than sixry (60)
days; or
e. Producer induces or attempts to induce any PacinCare member to give
up PacifiCare coverage or repiace a PacifiCare benefit agreement
wih coverage by any other company unless such change is cleariy in
the best interest of the PacifiCare member; or
d. producer commits any act of fraud or dishonesty or breaches any
contractual duty of this Agreement; or
e. Producer fails to notify PacifiCare of any change of Producer's
address within one (1) year.
2.5 Offset Against Commissions. Producer agrees that any indebtedness of
Producer to PacifiCare shall be a first lien against any commissions due
Producer and may be offset and be deducted at PaciCare's option from
commissions due to Producer.
2.6 Survival of Provisions. The provisions of this. Article II shall survive
the termination of this Agreement.
ARTICLE III. TERM AND TERMINATION
3.1 Term. This Agreement shall become effective on the date first set forth
above and shall continue in effect until terminated as provided beiow.
3.2 Termination Without Cause. This Agreement may be terminated at any time
by either party giving the other thirty (30) days prior written notice.
The effective date of termination shall be the first day of the month
following the thirty (30) day notice. Such termination shall not impair
Producer's right to receive commissions except as provided in this
Agreement.
3.3 Termination For Cause. Notwithstanding the provisions of Section 3.2,
PacifiCare may terminate this Agreement immediately at any time for
cause, by giving written notice to Producer. For purposes of this
Agreement, such cause shall include, but not be iimited to, tfae events
described in Section 2.4 hereof. The right to terminate this Agreement
for cause shall not be exclusive, but shall be cumulative with all other
remedies available at law or in equity. In addition, this Agreement will
be terminated automatically and without any required notice by
PacifCare, in its sole discretion, if any of me following occurs: (i) if
Producer is a corporation, the dissolution of the corporation; (ii)
disqualification of Producer to do business under applicable law; or
(iii) revocation or termination of Producer's license.
/s/ SD
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ARTICLE IV. GENERAL PROVISIONS
4.1 Independent Contractor Relationship. Producer agrees that in the
performance of the work, duties and obligations of the parties
hereunder, each party shall be deemed to be acting and performing as an
independent contractor and nothing in rhis Agreement shall be construed
or deemea a reiationsnip of employer and employee, partnership, joint
venture, or principal and agent, nor shall this Agreement be construed
in any proceeding or for any purpose whatsoever so as to make the other
party liable to any third person for the debts. faults or actions of the
other.
4.2 Arbitration. Should any dispute arise between the parties over any
provision of this Agreement or over any performance of this Agreement,
the dispute shall be submitted to binding arbitration. This arbitration
shall be conducted according to the rules of the American Arbitration
Association, but need not necessarily be conducted by that organization.
Each party shall initially equally contribute to the costs of
arbitration. During the arbitration each parry shall bear its own
attorneys' fees. Upon award of the arbitrator, both the decision of the
arbitrator and the award shall be final and the prevailing party snail
be entitled to recover from the other party its share of the arbitration
costs expended, and ail costs, including attorneys' fees. In the event
the arbitrator fails to render an award within ninety (90) days of
submission of the matter for decision, or such longer times as the
panics may stipulate, then either party may elect to have ail further
arbitration proceedings terminated and the matter submitted for judicial
resolution. All reasonable costs and fees incurred during the
arbitration shall then be awarded by the court to the prevailing party.
4.3 Non-Exclusive Arrangement. This is not an exclusive Agreement.
PacifiCare may use other persons and entities for the same or similar
services as are being provided by Producer.
4.4 Assignability. The rights and obligations set forth in this Agreement
may be assigned by PacifiCare to an affiliate or other entity of
PacifiCare or PacifICare's parent corporation. The rights and
obligations set forth in this Agreement may not be assigned by Producer
without the prior written consent of PacifiCare. Any attempted
assignment not in compliance with this Section is void and cause for
immediate termination by PacifiCare.
4.5 Severability. If any provision of this Agreement is deemed to be invalid
or unenforceable by a court of competent jurisdiction or by arbitration,
it shall be deemed severable from the remainder of the Agreement and
shall not cause the invalidity or unenforceability of the remainder of
the Agreement.
4.6 Enforcement. If any action at law or in equity is necessary to enforce
or interpret the terms of o the Agreement, the prevailing party shall be
entitled to payment by the other party of reasonable attorney's fees,
costs and necessary disbursement and expenses in addition to any other
reiiefto which such parry may be entitled.
4.7 Notice. Any and all notices required pursuant to the terms of this
Agreement must be given by United States mail, postage pre-paid, return
receipt requested at the following addresses:
If to PacifiCare:
President
PacifiCare of Utah, Inc.
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▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
If to Producer:
At the address set forth on the first page of this Agreement.
/s/ SD
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(Initials)
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4.8 Governing Law. PacifiCare and Proaucer snail compiy '.vim ail laws and
regulations applicable to their business, licenses and the transactions
into which they have entered. This Agreement shall be governed by and
construed in accordance with ail applicable state and federal laws.
4.9 Waiver. The waiver by either parry of any breach of this Agreement by
the other party shall not constitute a continuing waiver or a waiver or
any subsequent breach of the same or a different Section of this
Agreement.
4.10 Amendment. PacifiCare may amend this Agreement upon thirty (30) days
prior written notice, but any such amendment shall not affect the
Producer's rights in connection with business written with an effective
daie prior to the effective date of the amendment.
4.11 Use of Names and Trademarks. PacifiCare and Producer each reserve the
right to control the use of their names, symbols, trademarks, or other
marks currently existing or later established. However, either parry may
use the other party's name, symbols, trademarks or other marks with
prior written approval of the other party. PacifiCare shall be allowed
to use the name or Producer in its promotional activities and marketing
campaign.
4.12 Use of Words. In this Agreement the words "shall" and "will" are used in
the mandatory sense. Unless the context otherwise clearly requires, any
one gender includes all others, the singular includes the plural, and
the plural includes the singular.
4.13 Entire Agreement. This Agreement constitutes the entire understanding
between the parties. This Agreement shall supersede all prior written
agreements, including amendments and addenda, and both PacifiCare and
Producer mutually agree that any prior agreements shall automatically
terminate on the first day of the term of this Agreement. Any
commissions payable by the terms of prior agreements shall not be
impaired by the terms of this Agreement.
/s/ SD
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(Initials)
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[UTAH STATE SEAL-GRAPHIC OMITTED]
State of Utah
Insurance ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇, ▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
▇▇▇-▇▇▇-▇▇▇▇
FAX ▇▇▇-▇▇▇-▇▇▇▇
▇▇▇.▇▇▇▇▇▇▇▇▇.▇▇▇▇▇.▇▇▇▇.▇▇
▇▇▇▇▇▇▇ 0. ▇▇▇▇▇▇▇
Governor
▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
Commissioner
S
FRINGE BENEFIT ANALYSTS
▇▇▇ ▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
#▇
▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇
Insurance License
Resident Agent
The organization named above, having duly qualified under the laws of this
state, is hereby licensed to act within this state as indicated in the class
description and line(s) of authority to transact the kinds of insurance business
described below.
License number 3778 Insurance Lines Authorized
License Date: 03-23-1988
Expiration Date: 03-31-2000 11 Life 03-23-1988
Class Code: A Resident Agent 12 Disability 03-23-1988
13 Variable Contract 03-23-1988
[OFFICE OF THE INSURANCE
COMMISSIONER SEAL-GRAPHIC OMITTED]
/s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇
-------------------------
Commissioner of Insurance
8
AGENCY TO AGENT ACTIVE DESIGNATION -- List 10/8/98 15:30:38 Row Count: 23 Page 1 of 1
Agency Agent
Lic# Lic # Agent Last Name Agent First Name Middle Cert. Date Cert. ID Date Stamp User Stamp
3778 64274 ▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ CARVIN 08-05-1998 54415 08/19/1998 Iherrera
3778 68661 ▇▇▇▇▇▇▇▇ ▇▇▇▇ H 08-05-1998 54416 08/19/1998 Ilieirera
3778 28854 ▇▇▇▇▇ ▇▇▇▇▇ KENDAL 08-05-1998 54417 08/19/1998 Iherrera
3778 89288 ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇ 08-05-1998 54418 08/19/1998 Iherrera
3778 58107 CHATWIN ▇▇▇▇▇ ▇▇▇▇▇ 08-05-1998 54419 08/19/1998 Ilierrera
3778 40821 CORDON ▇▇▇▇▇ ▇▇▇▇ 08-05-1998 54420 08/19/1998 Iherrera
3778 73626 ▇▇▇▇▇▇ ▇▇▇ E 08-05-1998 54421 08/19/1998 Iherrera
3778 17749 ▇▇▇▇ ▇▇▇▇▇▇ J 03-23-19U8 9583 03/02/1997 WANG2LAN
3778 39879 ▇▇▇▇ ▇▇▇▇▇ M 03-23-1988 9588 03/02/1997 WANG2LAN
3778 46043 ▇▇▇▇ ▇▇▇▇▇ E 03-23-1988 9584 03/02/1997 WANG2LAN
3778 106571 ▇▇▇▇▇ ▇▇▇▇▇▇▇ 08-05-1998 54422 08/19/1998 Iherrera
3778 16529 ▇▇▇▇▇ J ▇▇▇▇ 08-05-1998 54423 08/19/1998 Iherrera
3778 38442 ▇▇▇▇▇▇▇▇ ▇▇▇▇ M 08-05-1998 54424 08/19/1998 Iherrera
3778 44287 ▇▇▇▇▇ ▇▇▇▇▇▇ R 08-24-1998 55191 10/07/1998 Illowe
3778 100225 KITCHEN ▇▇▇▇▇ E 08-05-1998 54425 08/19/1998 Iherrera
3778 59726 ▇▇▇▇▇▇ ▇▇▇▇▇▇ RAY 08-05-1998 54426 08/19/1998 Iherrera
3778 85096 ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ Ql 08-05-1998 54427 08/19/1998 Iherrera
3778 52529 ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇ 08-05 1998 54428 08/19/1998 Iherrera
3778 60783 ▇▇▇▇▇ ▇▇▇▇▇▇ L 08 05 1998 54429 08/19/1998 Iherrera
3778 5689 ▇▇▇▇▇ ▇▇▇▇▇ L 08-05-1998 54430 Oa/19/1998 Iherrera
3778 16344 ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ L 08-05-1998 54431 08/19/1998 Iherrera
3778 85319 ▇▇▇▇▇ ▇▇▇▇▇▇ C 08-05-1998 54432 08/19/1998 Iherrera
3778 15399 ▇▇▇▇▇▇▇ ▇▇▇▇▇ G 08-05-1998 54433 08/19/1998 Iherrera
9