AMENDED AND RESTATED VENDOR AGREEMENT

 

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                                                                   EXHIBIT 10.93

 

                                                                  EXECUTION COPY

 

                               ALLIANCE - MID-WEST

 

                      AMENDED AND RESTATED VENDOR AGREEMENT

 

      This agreement ("Agreement") is made and entered into effective as of June

1, 2005 by and between Mid-West National life Insurance Company of Tennessee, a

Tennessee domiciled life and health insurance company ("CARRIER"), and the

Alliance for Affordable Services, a membership organization that is organized

under the laws of the District of Columbia (the "ALLIANCE").

 

      WHEREAS, the ALLIANCE is a membership organization that provides or/and

makes available to its members a variety of services and benefits, including

health insurance products and other insurance related products;

 

      WHEREAS, CARRIER is in the business of selling life and health insurance

and other insurance related products;

 

      WHEREAS, CARRIER currently has group insurance policies ("Group Policies")

in force with to ALLIANCE Group Insurance Trust Fund, an Alabama trust (the

"Trust"), pursuant to which certificates of insurance have been and will be

issued to members of the ALLIANCE. CARRIER has also issued individual insurance

policies ("Individual Policies") to members of the ALLIANCE in states that do

not authorize the marketing and sale of "association group" policies; and

 

      WHEREAS, effective June 1, 2004, CARRIER and the ALLIANCE entered into a

Vendor Agreement, pursuant to which, among other things, the ALLIANCE agreed to

make available to its members such Group Policies, Individual Polices and other

insurance related products;

 

      WHEREAS, CARRIER and the ALLIANCE desire to enter into this Amended and

Restated Vendor Agreement;

 

      NOW, THEREFORE, for and in consideration of the mutual covenants and

agreements hereinafter set forth, the ALLIANCE and CARRIER hereby agree as

follows:

 

1. VENDOR RELATIONSHIP. The ALLIANCE agrees that during the Term hereof and upon

the terms and conditions contained herein it will make available to members of

the ALLIANCE such Group Policies, Individual Polices and other insurance related

products (collectively, the "Products") offered by CARRIER as the parties may

agree from time to time. CARRIER shall be solely responsible for designing the

Products involved and for establishing the prices to be charged for such

Products, subject to consultation with the ALLIANCE. The ALLIANCE shall be

solely responsible for determining which Products of CARRIER will be made

available through the ALLIANCE to its members. The ALLIANCE may make such

Products available to its members through its communications to members and

prospective members, through its catalog of benefits or through newspaper,

television or other advertisements and other means selected by the ALLIANCE in

its sole discretion. Nothing contained herein and no performance by the ALLIANCE

of its obligations hereunder shall be deemed to constitute an endorsement by the

ALLIANCE of CARRIER or of the Products, and the ALLIANCE assumes no financial

responsibility for the operating results of any Products sold by CARRIER to

members of the ALLIANCE.

 

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2. DEFINITIONS. For purposes of this Agreement, the following terms shall have

the following meanings:

 

            (a) Administrative Expense means, with respect to any period, costs

      incurred in such period by CARRIER for policy issuance and policy

      maintenance, but excluding the cost of investigating and paying claims.

 

            (b) Collected Premium means, with respect to any period, insurance

      premiums actually received in cash by CARRIER in such period.

 

            (c) Governmental Authority means any nation or government, any state

      or political subdivision thereof and any entity exercising executive,

      legislative, judicial, regulatory or administrative functions of or

      pertaining to government.

 

            (d) Health Policies means Individual Policies and Association Group

      Policies (but excluding ancillary products) issued by CARRIER, which are

      the principal Products that CARRIER will sell to members of the ALLIANCE.

 

            (e) Marketing Expense means, with respect to any period, the

      insurance commissions as a percentage of Collected Premiums paid to

      outside insurance agents in such period, plus any out of pocket marketing

      costs incurred in such period by CARRIER, for selling and servicing the

      Health Policies to members.

 

            (f) Person means any individual, corporation, limited liability

      company, business trust, association, company, partnership, joint venture,

      Governmental Authority, or other entity.

 

3. LIMITATION ON CARRIER'S MARKETING AND ADMINISTRATIVE EXPENSES. As partial

consideration for the ALLIANCE's agreement to make the Products available to its

members, CARRIER agrees as follows:

 

            (a) unless otherwise agreed to by the Parties, the Marketing Expense

      with respect to Health Policies shall not exceed in any calendar year the

      following amounts (expressed as a percentage of Collected Premiums): (i)

      44.5% of first year Collected Premiums, (ii) 30% of second year Collected

      Premiums and (iii) 15% of all Collected Premiums after the second policy

      year; and

 

            (b) unless otherwise agreed to by the Parties, Administrative

      Expense with respect to Health Policies shall not exceed 10% of Collected

      Premiums.

 

4. CARRIER'S REPORTS.

 

            (a) Annual Reports. Except for the reports provided pursuant to

      Section 4(a)(i), within 90 days after the end of each calendar year during

      the Term hereof, CARRIER shall submit written reports to the ALLIANCE

      setting forth the following information:

 

                  (i) Financial Status of CARRIER Report, including CARRIER's

            most recent annual audited statutory financial statements filed with

            the state insurance departments and CARRIER's current ratings with

            any rating agencies, which shall be submitted to the ALLIANCE on or

            before June 15 of each year for the most recent calendar year.

 

                  (ii) Health Insurance in Force Report, including, with respect

            to members of the ALLIANCE, the number of policies issued, the

            number of policies dropped, the number

 

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            of policies in force and the amount of Earned Premiums thereon for

            the most recent calendar year.

 

                  (iii) Claims Report in substantially the form, and contain

            substantially the information, as set forth in Schedule 4(a) (iii)

            hereto.

 

                  (iv) Complaints Report, including the number of complaints

            received regarding claims handling and regarding agent conduct, the

            source of such complaints (department of insurance, a member of the

            ALLIANCE or other) and the number of claims disposed of during the

            most recent calendar year on Health Policies issued to members of

            the ALLIANCE.

 

                  (v) Litigation Report. The number of legal actions brought

            against CARRIER with respect to any Products sold to members of the

            ALLIANCE, the number of such actions disposed of during the most

            recent calendar year and a brief description of any material

            litigation pending at year-end.

 

                  (vi) Certificate of Compliance, containing the calculation of

            CARRIER's compliance with the limitation on Marketing Expense and

            the limitation on Administrative Expense for the most recent

            calendar year and, if CARRIER did not comply with either of such

            limitations, CARRIER's plan for curing such non-compliance.

 

            (b) Quarterly Reports. Within 60 days following the end of each

      calendar quarter during the Term hereof (other than the fourth quarter of

      each year), CARRIER shall provide to the ALLIANCE unaudited statutory

      financial statements of CARRIER filed with the Oklahoma state insurance

      department, and a Health Insurance in Force Report, as described in

      Section 4(a)(ii) above, in each case as of the end of and for such

      calendar quarter.

 

            (c) Other Reports. CARRIER shall also provide such other reports as

      may reasonably be requested by the ALLIANCE during the Term hereof.

 

5. NOTICE OF RATE INCREASES. CARRIER shall provide to the ALLIANCE not less than

forty five (45) days' advance written notice of any proposed rate increases for

the Health Policies, such notice to include a statement that such premium rate

increase is deemed necessary based upon the analysis of the actuarial department

of CARRIER. ALLIANCE shall have the right to provide to CARRIER input with

respect to proposed rate decisions, and CARRIER agrees to share claim

information and experience with ALLIANCE to permit ALLIANCE to provide such

input. CARRIER agrees to consider recommendations by ALLIANCE and to provide its

rationale to ALLIANCE for decisions regarding rate increases that are contrary

to ALLIANCE's recommendations. Notwithstanding the foregoing, CARRIER shall at

all times retain the right to determine in its sole and absolute discretion the

amount and timing of any rate increase on Health Policies.

 

6. MUTUAL DISCLOSURES. CARRIER and the ALLIANCE each agree that they will

promptly notify the other Party of any complaints or notices of investigations

that they receive which will or may involve the other Party.

 

7. CONFIDENTIALITY: Each Party recognizes that in the course of exercising its

rights and performing its obligations under this Agreement it will come into

possession of confidential or proprietary information of the other Party or of

customers of the other Party ("Confidential Information"). Each Party agrees

that it will not disclose to anyone not a Party to this Agreement any

Confidential Information of the other

 

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Party or its customers and will not use any such Confidential Information except

to the extent necessary to carry out its obligations hereunder. Each Party

agrees to comply with the confidentiality requirements imposed on it by state

and Federal law, including the Health Insurance Portability and Accountability

Act of 1996 ("HIPPA"). Confidential Information does not include information

which (i) is or becomes generally available to the public other than pursuant to

a violation of this Agreement, (ii) was available to the Parties on a

non-confidential basis prior to its disclosure by the other Party or its

customer to such Party or (iii) became available to a Party on a

non-confidential basis from a third party who was not bound by a confidentiality

agreement with respect to such information.

 

8. REPRESENTATIONS AND WARRANTIES:

 

            (a) CARRIER hereby represents and warrants to the ALLIANCE as

      follows:

 

                  (i) CARRIER is a corporation duly organized, validly existing

            and in good standing under the laws of the State of Oklahoma and has

            all necessary corporate power and authority to enter into this

            Agreement and to consummate the transactions contemplated hereby and

            to perform its obligations hereunder.

 

                  (ii) All corporate and other actions or proceedings required

            to be taken by or on the part of CARRIER to authorize and permit the

            execution and delivery by it of this Agreement, the performance by

            it of its obligations hereunder, and the consummation by it of the

            transactions contemplated herein and therein, have been duly and

            properly taken.

 

                  (iii) This Agreement constitutes the legal, valid and binding

            obligation of CARRIER, enforceable against it in accordance with its

            terms, except as such enforceability may be limited by applicable

            bankruptcy, insolvency, moratorium, reorganization or similar laws

            in effect which affect the enforcement of creditors' rights

            generally and by equitable limitations on the availability of

            specific remedies.

 

                  (iv) CARRIER is duly licensed and has authority to issue Life

            and Health Policies and certificates to insureds in each of the

            states in which CARRIER is currently issuing such policies and

            CARRIER will obtain and retain all licenses necessary to conduct

            CARRIER's business during the term hereof.

 

                  (v) No authorization, approval, or consent of, and no filing

            or registration with, any Governmental Authority or third party is

            or will be necessary for the execution, delivery of this Agreement,

            or performance by CARRIER or for the validity or enforceability

            thereof, except for such approvals or consents which have been