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EXHIBIT 8(h)
Master Administration Agreement
for
Variable Universal Life Insurance and Variable Annuities
between
XxXxxxxx Systems, L.L.C.
and
Farmers New World Life Insurance Company
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TABLE OF CONTENTS
SECTION 1 DEFINITIONS............................................................................................................1
1.01 Books and Records..................................................................................................1
1.02 Initial Term.......................................................................................................2
1.03 Policy Administration Services.....................................................................................2
1.04 Annuity Contract Administration Services...........................................................................2
1.05 Policies...........................................................................................................2
1.06 Contracts..........................................................................................................2
1.07 Products...........................................................................................................2
SECTION 2 TERM...................................................................................................................2
SECTION 3 POLICY OR ANNUITY CONTRACT ADMINISTRATION..............................................................................2
3.01 Administrative Services............................................................................................2
3.02 Performance Criteria...............................................................................................3
3.03 Authorized Personnel...............................................................................................3
3.04 Records............................................................................................................3
SECTION 4 FEES AND EXPENSES......................................................................................................3
4.01 Administration Fees................................................................................................3
4.02 Expenses...........................................................................................................4
4.03 System Enhancements................................................................................................4
4.04 Payment............................................................................................................4
SECTION 5 REPRESENTATIONS AND WARRANTIES OF XXXXXXXX.............................................................................5
SECTION 6 REPRESENTATIONS AND WARRANTIES OF COMPANY..............................................................................5
SECTION 7 ADDITIONAL COVENANTS...................................................................................................6
7.01 Independent Contractor.............................................................................................6
7.02 Confidentiality and Disclosure.....................................................................................6
7.03 Indemnification....................................................................................................8
7.04 Arbitration........................................................................................................8
7.05 Compliance.........................................................................................................8
7.06 Actions............................................................................................................8
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7.07 Records............................................................................................................8
7.08 Audit..............................................................................................................8
7.09 Security of Operations.............................................................................................8
7.10 Insurance Coverage.................................................................................................8
SECTION 8 TERMINATION OF AGREEMENT...............................................................................................8
8.01 By Mutual Agreement................................................................................................8
8.02 By Non-Renewal.....................................................................................................8
8.03 For Cause..........................................................................................................8
SECTION 9 ASSIGNMENT.............................................................................................................8
9.01 Assignment by Company..............................................................................................8
9.02 Assignment by XxXxxxxx.............................................................................................8
SECTION 10 MISCELLANEOUS.........................................................................................................8
10.01 Governing Law......................................................................................................8
10.02 Notices............................................................................................................8
10.03 Entire Agreement...................................................................................................8
10.04 Binding Effect.....................................................................................................8
10.05 Severability.......................................................................................................8
10.06 No Third Party Beneficiaries.......................................................................................8
10.07 Headings...........................................................................................................8
10.08 Counterparts.......................................................................................................8
10.09 Waiver.............................................................................................................8
10.10 Construction.......................................................................................................8
10.11 Taxes..............................................................................................................8
10.12 Software Escrow Agreement..........................................................................................8
10.13 Software License in Escrow.........................................................................................8
10.14 Force Majeure......................................................................................................8
SECTION 11 YEAR 2000 COMPLIANCE..................................................................................................8
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TABLE OF EXHIBITS
A Policy Administration Services
B Annuity Contract Administration Services
C Performance Criteria
D Fee Schedule
E Products
F Schedule of Authorized Personnel
G Insurance Coverage
H Sample Software Escrow Agreement
I Sample Software License Agreement
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MASTER ADMINISTRATION AGREEMENT
This MASTER ADMINISTRATION AGREEMENT (this "Agreement") is made and
entered into as of the ___ day of ______, 1999, by and between XxXxxxxx Systems,
L.L.C., a Georgia limited liability company, having its principal address and
place of business at 0000 Xxxxxx Xxxxx Xxxx, Xxxxx Xxxxx, Xxxxxxx, Xxxxxxx,
00000 (hereinafter referred to as "XxXxxxxx"); and Farmers New World Life
Insurance Company, a stock/mutual company registered under the laws of the State
of _____, having its principal place of business at 0000 - 00xx Xxxxxx X.X.,
Xxxxxx Xxxxxx, Xxxxxxxxxx, 00000 (hereinafter referred to as "FNWL").
W I T N E S S E T H:
WHEREAS, the parties hereto desire to enter into this Agreement to
provide for the provision by XxXxxxxx, as an independent subcontractor, of
insurance policy and annuity contract administration to FNWL on the terms and
conditions hereinafter set forth,
NOW, THEREFORE, in consideration of the mutual covenants hereinafter
set forth, and other good and valuable considerations, the receipt and
sufficiency of which are hereby acknowledged, and intending to be legally bound,
the parties hereto hereby agree as follows:
SECTION 1 DEFINITIONS.
As used in this Agreement, the following terms shall have the
meaning set forth:
1.01 Books and Records. "Books and Records" means all books and
records in the possession or control of XxXxxxxx that contain information
related to the Policies (defined in Section 1.08 below) and Annuity Contracts
(defined in Section 1.06 below), including without limitation, to the extent any
of the following exist, (i) hard copy and microfiche records; (ii) all paper
files; (iii) all electronic images: (iv) all computer data files; (v) all
correspondence between XxXxxxxx and owners of Policies or Annuity Contracts;
(vi) administrative records; (vii) claim records; (viii) sales records; (ix)
reinsurance records, (x) underwriting records and (xi) accounting records;
provided, however, that Books and Records shall not include any of XxXxxxxx'x
internal documentation of its own programs, systems and procedures or any of
XxXxxxxx'x books and records which are not directly related to the Policies.
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1.02 Initial Term. "Initial Term" means the five (5) year period
commencing on the Effective Date of this Agreement and ending at 11:59 p.m. on
the day prior to the fifth anniversary of the Effective Date.
1.03 Policy Administration Services. "Policy Administration
Services" means the services set forth in Exhibit A attached hereto and
designated as "Policy Administration Services".
1.04 Annuity Contract Administration Services. "Annuity Contract
Administration Services" means the services set forth in Exhibit B attached
hereto and designated as "Annuity Contract Administration Services".
1.05 Policies. "Policies" means, collectively, the insurance
policies included within one of the Products and "Policy" means any one of the
Policies.
1.06 Contracts. "Contracts" mean, collectively, the annuity
contracts included within one of the Products and "Contract" means any one of
the Annuity Contracts.
1.07 Products. "Products" means the insurance or annuity products
described in Exhibit E attached hereto and made a part hereof. A "Product" is
limited to a single insurance policy form or a single annuity contract form of
FNWL. Exhibit E may be amended during the Term by mutual written agreement of
the parties hereto.
SECTION 2 TERM.
This Agreement shall commence on the Effective Date and shall
continue in effect for the Initial Term; thereafter this Agreement shall
continue in full force and effect from year to year until terminated as herein
provided, each such additional year being an "Additional Term" of this
Agreement. The Initial Term and any Additional Terms hereunder are herein
collectively referred to as the "Term".
SECTION 3 POLICY OR ANNUITY CONTRACT ADMINISTRATION.
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3.01 Administrative Services. During the Term, XxXxxxxx shall
perform Policy and Annuity Contract Administration Services as set forth in
Exhibits A and B.
3.02 Performance Criteria. The manner and method of performing
Administration Services is set forth in Exhibit C.
3.03 Authorized Personnel. At any time XxXxxxxx may apply to a
person indicated on the "Schedule of Authorized Personnel", attached hereto as
Exhibit F, as a person authorized to give instructions under this section with
respect to any matter arising in connection with this Agreement. XxXxxxxx shall
not be liable for, and shall be indemnified and held harmless by FNWL against
any loss, cost, damage or expense arising from, any action taken or omitted by
XxXxxxxx to the extent XxXxxxxx can demonstrate that the action or omission was
taken or omitted in good faith in reliance upon such instruction.
FNWL may at any time provide XxXxxxxx with written notice of any
change of authority of persons authorized and enumerated in Exhibit F to provide
XxXxxxxx with instructions or directions relating to services to be performed by
XxXxxxxx under this Agreement.
3.04 Records. During the Term, XxXxxxxx shall keep true and correct
Books and Records relating to the performance of all Administration Services
hereunder. XxXxxxxx shall deliver the Books and Records and copies thereof to
FNWL, if so requested by FNWL, within thirty (30) days upon termination of this
Agreement. Anything herein to the contrary notwithstanding, XxXxxxxx shall be
allowed to make and retain copies of the Books and Records, at its own expense,
upon termination of this Agreement. It is acknowledged and agreed that any such
Books and Records may be maintained on magnetic media, electronic media,
microfiche, CD and other non-paper media.
SECTION 4 FEES AND EXPENSES.
4.01 Administration Fees.
(a) During the Initial Term of this Agreement, FNWL shall pay to
XxXxxxxx, as compensation for all Administration Services rendered pursuant to
this Agreement, the amounts set forth in Exhibit D. In
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no event, except as provided below, will the fees payable by FNWL to XxXxxxxx
hereunder be less than the fees determined by the application of the Minimum
Charges set forth in Exhibit D.
(b) For each Additional Term of this Agreement, FNWL shall pay to
XxXxxxxx, as compensation for all Administration Services rendered pursuant to
this Agreement, such fees and charges as shall be agreed to by the parties and
attached hereto as an amended Exhibit D prior to commencement of such Additional
Term.
4.02 Expenses. FNWL will promptly reimburse XxXxxxxx for all
reasonable out-of-pocket expenses incurred by XxXxxxxx in the performance of
this Agreement. Out-of-pocket expenses include, but are not limited to the
following:
(a) Travel related costs for travel requested by FNWL.
(b) Postage, forms, mailings, stationery and freight costs requested
by FNWL.
(c) Charges for telephone line(s) and long distance telephone calls
dedicated to service of FNWL customers, agents and brokers and charges for long
distance telephone calls made to service FNWL's business.
Charges for dedicated voice/data lease line(s) providing wide area network
access from FNWL site(s) to XxXxxxxx site(s).
Charges for supplies and maintenance of dedicated FNWL hardware and
equipment including but not limited to printers, faxes and modems.
Charges for FNWL dedicated U.S. Post Office boxes.
4.03 System Enhancements. Requests by FNWL for enhancements to
systems or procedures for support of new products or new functional capabilities
will be performed and billed by XxXxxxxx to FNWL pursuant to that certain
Consulting Services Agreement of even date herewith.
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4.04 Payment. During the Term of this Agreement, FNWL shall pay
XxXxxxxx within thirty (30) days of the date of XxXxxxxx'x invoice. Late
payments shall be subject to XxXxxxxx'x standard late payment charges. A finance
charge of one and one-half (1 1/2%) percent per month (annual rate of eighteen
(18%) percent), or the highest interest rate allowed by law, whichever is lower,
will be added to all invoices not paid thirty (30) days after the date of
receipt of the invoice. In addition, failure of FNWL to fully pay any invoiced
amount within sixty (60) days after the date of receipt of the invoice shall be
deemed a material breach of the Agreement.
SECTION 5 REPRESENTATIONS AND WARRANTIES OF XXXXXXXX.
XxXxxxxx hereby represents and warrants to FNWL as follows:
(a) It is a limited liability company duly organized and existing
and in good standing under the laws of the State of Georgia.
(b) It is empowered under applicable laws and by its articles of
organization and operating agreement to enter into and perform the services
contemplated in this Agreement.
(c) All requisite proceedings have been taken to authorize it to
enter into and perform the services contemplated in, and execute and deliver,
the Agreement.
(d) It has duly executed and delivered this Agreement and neither
such execution and delivery nor the performance by it of any of its obligations
under this Agreement will (i) violate any provision of its certificate of
incorporation or by-laws, (ii) result in a violation or breach of, or constitute
a default or an event of default under, any indenture, mortgage, bond or other
contract, license, agreement, permit, instrument or other commitment or
obligation to which it is a party or (iii) violate any law, rule or regulation
of any governmental body, writ, judgment, injunction or court decree
(collectively, "Laws") applicable to it or its business.
(e) It has all licenses, permits, registrations and other
governmental approvals necessary or
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advisable for the performance of its obligations under this Agreement.
(f) Its business operations have been conducted, are now, and will
continue to be in compliance in all material respects with all Laws.
(g) In its reasonable business judgment, it has the facilities,
equipment and personnel necessary to carry out its duties and obligations under
this Agreement.
SECTION 6 REPRESENTATIONS AND WARRANTIES OF FNWL.
FNWL hereby represents and warrants to XxXxxxxx as follows:
(a) It is a registered stock/mutual company organized and existing
and in good standing under the laws of the State of _____.
(b) It is empowered under the applicable laws and regulations and by
its governing documents to enter into and perform this Agreement.
(c) All requisite proceedings have been taken to authorize it to
enter into and perform this Agreement.
(d) It has duly executed and delivered this Agreement and neither
such execution and delivery nor the performance by it of any of its obligations
under this Agreement will (i) violate any provision of its governing documents,
(ii) result in a violation or breach of, or constitute a default or an event of
default under, any indenture, mortgage, bond or other contract, license,
agreement, permit, instrument or other commitment or obligation to which it is a
party or (iii) violate any Law applicable to it or its business.
SECTION 7 ADDITIONAL COVENANTS.
7.01 Independent Contractor. It is understood and agreed that all
Administration Services performed hereunder by XxXxxxxx shall be performed
solely for FNWL by XxXxxxxx in the capacity of an
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independent sub-contractor of FNWL. Nothing contained herein shall be construed
to create between XxXxxxxx and FNWL a partnership, joint venture, association or
other legal entity or relationship other than that of independent
sub-contractor.
7.02 Confidentiality and Disclosure.
(a) Each Party to this Agreement ("Disclosing Party") may disclose
to the other party ("Recipient") certain proprietary and confidential
information including, without limitation, policyholder/contract holder
information, procedures, FNWL customer lists, prospect lists, contracted broker
and agent lists, and material related to policy/contract design, pricing,
filings, marketing and sales administration and systems information
("Information").
(b) Recipient agrees to maintain, during the Term and thereafter,
the Information of the Disclosing Party in confidence using at least the same
degree of care as it uses in maintaining as secret its own trade secret,
confidential and proprietary information, but always at least a reasonable
degree of care.
(c) Disclosing Party agrees that Recipient shall have no obligation
under the provisions of this Section 7.02 with respect to any Information which:
1. is now or hereafter becomes publicly known other than
through a breach hereof,
2. is disclosed to Recipient by a third party that
Recipient reasonably believes is legally entitled to
disclose such information,
3. is known by Recipient prior to its receipt of the
Information, without any obligation of confidentiality
with respect thereto,
4. subject to paragraph (g) below, is disclosed with the
Disclosing Party's written consent,
5. is disclosed by the Disclosing Party to a third party
without the same or similar
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restrictions as set forth herein,
6. is required to be disclosed by Recipient by a court of
competent jurisdiction, administrative agency or
governmental body, or by law, rule or regulation, or by
applicable regulatory or professional standards, or
7. is disclosed by Recipient in connection with any
judicial or other legal proceeding involving the
Agreement, or
8. subject to paragraph (g) below is not identified or
marked as "Confidential and Proprietary" as provided in
paragraph (a).
(d) Recipient shall use reasonable efforts to limit access to
Information received from the Disclosing Party to only those personnel of
Recipient who have need of such access for the performance of any obligation of
Recipient under this Agreement.
(e) Recipient shall use information only for purposes of fulfilling
its obligations under the Agreement.
(f) Except as expressly provided in the Agreement, Disclosing Party
grants no license, right or interest to Recipient under any copyrights, patents,
trademarks, trade secrets or other property rights of Disclosing Party by reason
of the disclosure of the Information.
(g) Each party acknowledges that some Information may, under
applicable law, be deemed to be confidential information of third parties (such
as natural persons whose lives are insured under a Policy or Annuity Contract)
and agrees to preserve the confidentiality of all Information, which under
applicable Law must be treated as confidential.
The terms and conditions of this Section 7.02 shall survive the
termination of this Agreement.
7.03 Indemnification. Each party to this Agreement shall indemnify
and hold harmless the other
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party and its officers, directors, partners, principals, independent
contractors, employees, member firms, subcontractors and affiliates and their
respective personnel from and against any and all liabilities, losses, damages,
costs, expenses (including, without limitation, reasonable attorneys' fees and
court costs), interest, penalties or other loss directly or indirectly arising
out of, in connection with or with respect to any breach of this Agreement or
any fraudulent, criminal, negligent and/or bad faith acts or omissions by such
party or its officers, directors, partners, principals, independent contractors,
employees, member firms, subcontractors and affiliates and their respective
personnel under this Agreement.
If a party is named in any lawsuit or other proceeding for which
such party believes it may be entitled to indemnification hereunder (other than
any action or proceeding described in Section 7.06), such party shall promptly
give notice thereof to the other party, such notice to include a description in
reasonable detail of such lawsuit or proceeding and the basis for such party's
belief that it may be entitled to indemnification hereunder. The parties shall
cooperate in all reasonable respects with each other in defending such lawsuit
or proceeding. XxXxxxxx agrees not to settle any such lawsuit or proceeding
without the written consent of FNWL.
Anything in this Agreement to the contrary notwithstanding, XxXxxxxx
shall have no liability whatsoever for any trading or investment losses incurred
with respect to any Policy/Contract by reason of XxXxxxxx'x failure or inability
to accurately or timely transmit information or otherwise perform the
Administrative Services contemplated hereunder ("Breakage"). The parties hereto
acknowledge that this limitation of liability is reasonable inasmuch as XxXxxxxx
shall also not be entitled to any gains or profits which may occur as a result
of any such Breakage. Except for the limitation of liability set forth herein
with respect to Breakage, nothing contained in this provision shall limit the
remedies available to AGLC in the event of XxXxxxxx'x failure to properly
perform its duties hereunder.
The terms and conditions of this Section 7.03 shall survive the
termination of this Agreement.
7.04 Arbitration. In the event of any dispute between FNWL and
XxXxxxxx with respect to the subject matter of this Agreement or the enforcement
of rights hereunder, either party may, by written notice to the other, require
such dispute or difference to be submitted to arbitration. This provision,
however, shall not be applicable to any dispute that involves a claim by or
against a Third Party. The arbitrator or arbitrators
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shall be selected by agreement of the parties or, if they cannot agree on an
arbitrator or arbitrators within twenty (20) days after the notice of such
party's desire to have the question settled by arbitration, then the arbitrator
or arbitrators shall be selected by the American Arbitration Association (the
"AAA") in Atlanta, Georgia. The determination reached, or award granted, in such
arbitration shall be final and binding, to the extent not in violation of law or
public policy, on all parties hereto. Enforcement of the arbitration award or
determination may be sought in any court of competent jurisdiction. The
arbitrators shall not be bound by judicial formalities and may abstain from
following the strict rules of evidence. The parties hereby mutually instruct the
arbitrators to limit the time and scope of discovery to the greatest extent
practicable and request the arbitrators to provide a decision as rapidly as
practicable, in each case consistent with the interests of justice, it being the
intention of the parties that any arbitration under this Section 7.04 be
commenced, conducted and completed, and a decision rendered, as rapidly as
practicable. Pending such decision, each party will continue to perform its
obligations under this Agreement. Unless otherwise agreed by the parties, any
such arbitration shall be conducted in accordance with the rules of the AAA.
In the event of any litigation or arbitration as provided under this
Agreement, or the enforcement of rights hereunder, each party shall bear its own
costs and expenses relating to such litigation or arbitration, including
reasonable attorney's fees and expenses, unless otherwise provided by the
arbitration award or determination. In no event shall the arbitrators have the
right or authority to award consequential, incidental, indirect, special or
punitive damages relating to this Agreement.
The terms and conditions of this Section 7.04 shall survive the
termination of this Agreement.
7.05 Compliance. XxXxxxxx shall provide staff with the skills
necessary to perform the Administrative Services, as determined by XxXxxxxx
using its reasonable business judgment. XxXxxxxx shall obtain and maintain for
itself, all licenses necessary for performance under this Agreement.
7.06 Actions.
(a) Each party to this Agreement (the "Notifying Party") shall
promptly notify the other party of any threatened or pending lawsuit or
governmental or regulatory agency inquiry or complaint relating to Policies of
which the Notifying Party has actual knowledge and shall promptly transmit to
such other party
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a copy of any applicable service of process or other instrument related to a
court proceeding or any correspondence or other document transmitted to or from
any governmental or regulatory agency relating to the Policies which shall be
actually received by the Notifying Party.
(b) XxXxxxxx shall make no response to any governmental or
regulatory agency's inquiry or complaint relating to Policies without first
obtaining FNWL's approval and consent to the response to such inquiry or
complaint; provided, however, that if FNWL fails to give its approval or consent
or delays its approval or consent and such failure or delay would subject
XxXxxxxx to any fine, penalty, liability or sanction, then XxXxxxxx may make a
response.
(c) FNWL reserves the right to control the defense of any
litigation, threatened or pending, by or against it, or to respond on its own
behalf to any governmental or regulatory agency's inquiry or complaint;
provided, however, that if FNWL shall exercise this right in such a manner as
shall subject XxXxxxxx to any fine, penalty, liability or sanction for failure
to follow procedure, or otherwise in a manner which, in the reasonable opinion
of XxXxxxxx or its legal counsel may have a material adverse effect on XxXxxxxx,
then XxXxxxxx shall have the right to defend itself with counsel of its choice
at its own expense.
(d) XxXxxxxx reserves the right to control the defense of any
litigation, threatened or pending, by or against it, or, subject to subsection
(b) above, to respond on its own behalf to any governmental or regulatory
agency's inquiry or complaint; provided, however, that if XxXxxxxx shall
exercise this right in such a manner as shall subject FNWL to any fine, penalty,
liability or sanction for failure to follow procedure, or otherwise in a manner
which, in the reasonable opinion of FNWL or its legal counsel may have a
material adverse effect on FNWL, then FNWL shall have the right to defend itself
with counsel of its choice at its own expense.
(e) The parties shall cooperate with each other in responding to or
defending any such lawsuit, threat, demand, inquiry, complaint, administrative
or regulatory investigation or proceeding.
7.07 Records. Each party to this Agreement shall maintain, following
the termination of this Agreement for any reason, its Books and Records with
respect to business produced under this Agreement for such period of time as may
be required by law. It is acknowledged and agreed that any such books and
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records may be maintained on magnetic media, electronic media, microfiche or
other non-paper media.
7.08 Audit. Upon forty-eight (48) hours advanced notice to XxXxxxxx,
FNWL will have the right under this Agreement to perform on-site inspection and
analyses of the Books and Records in accordance with reasonable procedures and
at reasonable frequencies. At the request of FNWL, XxXxxxxx will make available
to FNWL representatives of the appropriate regulatory agencies all reasonable
requested Books and Records and access to operating procedures.
7.09 Security of Operations. XxXxxxxx shall maintain such off-site
backup of its systems, procedures, and Books and Records as FNWL may reasonably
request. XxXxxxxx shall maintain at all times during the Term a disaster
recovery capability materially consistent with that currently maintained by
XxXxxxxx.
7.10 Insurance Coverage. XxXxxxxx shall use its reasonable efforts
to continue in effect the insurance coverages described in Exhibit G attached
hereto provided that such coverage is available from a domestic insurance
carrier at a reasonable cost to XxXxxxxx. XxXxxxxx shall not voluntarily cause
any termination, reduction, or alteration of these coverages without thirty (30)
days prior written notice to FNWL.
SECTION 8 TERMINATION OF AGREEMENT.
8.01 By Mutual Agreement. This Agreement may be terminated or
amended by mutual written agreement of the parties at any time.
8.02 By Non-Renewal. At least one hundred and eighty (180) days
prior to the end of the Initial Term and any Additional Term hereof, either
party may give the other notice if the party delivering such notice desires to
change any term of the Agreement. If XxXxxxxx and FNWL do not agree in writing
with respect to the matters described in such notice before the end of the Term
during which XxXxxxxx gives such notice, this Agreement shall terminate at the
end of such Term.
8.03 For Cause. If either of the parties hereto shall materially
breach this Agreement or be materially in default hereunder (the Defaulting
Party), the other party hereto may give written notice thereof
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to the Defaulting Party and if such default or breach shall not have been
remedied within thirty (30) days after such written notice is given, then the
party giving such written notice may terminate this Agreement by giving thirty
(30) days written notice of such termination to the Defaulting Party.
Termination of this Agreement by default or breach by a party shall not
constitute a waiver of any rights of the other party in reference to services
performed prior to such termination, rights to be reimbursed for out-of-pocket
expenditures or any other rights such other party might have under this
Agreement at law, in equity or otherwise.
SECTION 9 ASSIGNMENT.
9.01 Assignment by FNWL. FNWL shall not, directly or indirectly, in
whole or in part, assign any of its rights or obligations hereunder without the
prior written consent of XxXxxxxx, which consent shall not be unreasonably
withheld.
9.02 Assignment by XxXxxxxx. XxXxxxxx shall not directly or
indirectly, in whole or in part, delegate its duties or assign its rights under
this Agreement without the prior written consent of FNWL, which consent shall
not be unreasonably withheld.
SECTION 10 MISCELLANEOUS.
10.01 Governing Law. This Agreement shall be governed by, and
construed in accordance with, the laws of the State of Georgia, without giving
effect to the principles of conflicts of laws thereof.
10.02 Notices. Any notice, consent, approval or other communication
required or permitted hereunder shall be in writing and shall be delivered
personally, or sent by facsimile transmission, overnight courier service or by
registered or certified mail, postage prepaid, return receipt requested, and
addressed as follows:
(a) If to XxXxxxxx:
XxXxxxxx Systems, L.L.C.
0000 Xxxxxx Xxxxx Xxxx
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Xxxxx Xxxxx
Xxxxxxx, XX 00000
Attention: Vice Chairman
Facsimile Number: (000) 000-0000
(b) If to FNWL:
Farmers New World Life Insurance Company
0000 - 00xx Xxxxxx X.X.
Xxxxxx Xxxxxx, XX 00000
Attention: President
Facsimile Number: (xxx) xxx-xxxx
Any such notice shall be deemed given when so delivered (in the case
of personal delivery or overnight courier service) or sent by facsimile
transmission or, if mailed, upon receipt as evidenced by the return receipt. If
the address of any party hereunto is changed, written notice of such change
shall be given to the other party, in accordance with this Section, and said new
address shall be used for purposes of this Agreement.
10.03 Entire Agreement. This Agreement, the Exhibits which are
attached hereto and made a part hereof, and the documents executed pursuant
hereto, contain the entire understanding of the parties with respect to the
subject matter hereof and thereof and no representation, warranty, covenant or
agreement not embodied herein or therein, oral or otherwise, shall be of any
force or effect whatsoever with respect to the subject matter hereof or thereof.
Further, no change, amendment or modification of this Agreement shall be
effective unless in writing and signed by both parties hereto.
10.04 Binding Effect. This Agreement shall be binding upon and shall
inure to the benefit of the parties hereto and their respective successors and
permitted assigns.
10.05 Severability. In the event any one or more of the provisions
contained in this Agreement shall, for any reason, be held to be invalid,
illegal or unenforceable in any respect, such invalidity, illegality
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or unenforceability shall not affect any other provision of this Agreement.
10.06 No Third Party Beneficiaries. Nothing in this Agreement is
intended or shall be construed to give any person, other than the parties
hereto, any legal or equitable right, remedy or claim under or in respect of
this Agreement or any provision contained herein.
10.07 Headings. The Section headings of this Agreement are for
convenience only and shall not affect the construction or interpretation of this
Agreement.
10.08 Counterparts. This Agreement may be executed in two (2) or
more counterparts, each of which shall be deemed an original but all of which
will constitute one and the same document.
10.09 Waiver.
(a) A waiver of any default or breach hereunder granted by any party
hereto shall not constitute a waiver by such party of any other default or
breach or a waiver by such party of the same default or breach at a later time.
Further, to be effective, any such waiver must be in writing and be signed by
the party granting such waiver.
(b) Subject to the last sentence of Section 10.09(a), the
forbearance or neglect by FNWL or XxXxxxxx to insist upon strict compliance with
any of the provision of this Agreement, or to declare a forfeiture or
termination, shall not be construed as a waiver of any right or privilege
hereunder. No waiver of any right or privilege arising from any default or
failure of performance hereunder shall affect the rights or privileges of either
party in the event of a further default or failure of performance hereunder.
10.10 Construction. All parties hereto have participated, directly
or indirectly, in the negotiations and preparation of this Agreement. In no
event shall this Agreement be construed more or less stringently against any
party hereto by reason of either party being construed as the principal drafting
party hereto.
10.11 Taxes. All sales, use, excise or other similar taxes or duties
which may be or become payable on account of goods or services provided
hereunder shall be payable by FNWL to XxXxxxxx Systems upon
15
20
the receipt by FNWL of XxXxxxxx Systems' invoice therefor. In lieu of paying
such taxes, FNWL may provide XxXxxxxx Systems with a tax exemption certificate
acceptable in form and substance to the appropriate taxing authorities.
10.12 Software Escrow Agreement. As soon as is practicable after the
execution of this Agreement, (i) the parties hereto shall execute and deliver an
Escrow Agreement substantially in the form of Exhibit H attached hereto and made
a part hereof (the "Escrow Agreement") for the purpose of protecting FNWL in the
event of a breach of this Agreement by XxXxxxxx or the termination of this
Agreement by FNWL for Cause, pursuant to Section 8 hereof, prior to the end of
the Term; and (ii) upon execution of the Escrow Agreement by all parties
thereto, XxXxxxxx shall deposit with the Escrow Agent a copy of the Software to
be held in accordance with the terms and conditions of the Escrow Agreement.
10.13 Software License in Escrow As soon as is practicable after
execution of the Escrow Agreement, the parties hereto shall execute and deliver
to the Escrow Agent, to be held in accordance with the terms and conditions of
the Escrow Agreement, a License Agreement substantially in the form of Exhibit I
attached hereto and made a part hereof (the "License Agreement"), which shall
provide that in the event the Software shall be released by the Escrow Agent to
FNWL, upon the occurrence of a Release Event (as defined in the Escrow
Agreement), but only in such event, XxXxxxxx grants to FNWL, effective upon
receipt of the Software from the Escrow Agent, a license to use the Software
(and such modifications, enhancements, improvements, updates, corrections or
changes as FNWL shall elect to make to the Software) (the "Software License")
for a period of twenty-four months following the termination of this Agreement,
solely on the terms and conditions of the License Agreement. At the expiration
of the license term, the FNWL shall have no further rights with respect to the
Software.
10.14 Force Majeure Neither party shall be in default of this
Agreement to the extent that the performance of its obligations under this
Agreement is delayed or prevented by reason of any act of God, fire, natural
disaster, accident, act of government, strike, riot, act of war, restricting
legislation, embargo, blockade, work stoppage, or any other like cause beyond
the control of such party, provided that such causes shall not relieve FNWL of
its payment obligations as set forth in Sections 3 and 4 (except that FNWL shall
not be required to make payment for services not rendered by reason of such a
force majeure condition).
16
21
SECTION 11 YEAR 2000 COMPLIANCE.
XxXxxxxx hereby represents and warrants that the VPAS(R) Life Administration
System software is Year 2000 Compliant. For these purposes, Year 2000 Compliant
is defined to mean that this software:
uses date data century recognition, and as appropriate,
same century and multi-century formulas and date values in each instance for all
calculations for which a date is used;
will not abnormally end or provide invalid or incorrect
results as a result of date data, specifically including date data which
represents or references different centuries or more than one century; and
otherwise conforms with the current industry standards in order that it will
fully perform without any errors or other problems due to the year being greater
than 1999;
will correctly manage and manipulate data involving
dates, including, but not limited to: single-century formulas and multi-century
formulas, century recognition and calculations that accommodate same century and
multi-century formulas, comparing and sequencing, and leap year calculations;
and will operate without any time or Year 2000 related defects or abnormalities;
and
to the extent that the software will accept data from
other systems and sources that are not Year 2000 Compliant, the software will
properly recognize, calculate, sort, store output, and otherwise process such
data in a manner that eliminates any century ambiguity so that the software
remains Year 2000 Compliant.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed and delivered by their duly authorized partners and officers, all as
of the date first above written.
XxXxxxxx Systems, L.L.C. Farmers New World Life Insurance Company
By: By:
---------------------------- --------------------------------------
J. Xxxxxx Xxxxxxx, Jr. Name:
Vice Chairman ------------------------------------
Title:
-----------------------------------
17
22
EXHIBIT C
PERFORMANCE CRITERIA
1. XxXxxxxx shall discharge its duties hereunder in a manner that is
consistent with insurance industry practices.
2. Performance with respect to Policy/Annuity Contract Administration
Services shall include the following:
(a) XxXxxxxx will electronically, or by hard copy or both as
periodically agreed upon by FNWL and XxXxxxxx, provide
FNWL with copies of all policy/contract owner and
agent/broker reports, letters and other correspondence
on an agreed upon basis;
(b) Calculation of policy/contract values, dividends,
earnings, distributions, and commissions will be made in
accordance with procedures agreed to by FNWL and
XxXxxxxx and will not be changed without prior approval
by FNWL;
(c) Specimens of each policy/contract owner and agent/broker
report referenced in Exhibit A- Policy Administration
Services and Exhibit B - Annuity Contract Administration
Services will be provided to FNWL and changes to
existing report formats or development of new reports
will be provided to FNWL for approval prior to use;
(d) Calculation of settlements including but not limited to
loans, death proceeds, withdrawals and surrenders will
be done in accordance with procedures agreed to by FNWL,
and will be sent to FNWL within three working days
following receipt by XxXxxxxx of all required
documentation.
3. Performance with respect to financial reporting shall include the
following:
(a) XxXxxxxx will deliver financial reports within five
working days following the accounting
C-1
23
EXHIBIT C
PERFORMANCE CRITERIA
close, as agreed to by FNWL and XxXxxxxx;
(b) XxXxxxxx will maintain financial records in accordance
with procedures agreed to by FNWL and XxXxxxxx and will
not change procedures without prior approval by FNWL.
5. FNWL and XxXxxxxx may mutually agree, from time to time, to
modifications of the administrative services and/or performance
criteria or to additional administrative services and/or performance
criteria.
C-2
24
EXHIBIT D
ANNUAL FEE SCHEDULE FOR VARIABLE UNIVERSAL LIFE POLICY AND
VARIABLE ANNUITY CONTRACT ADMINISTRATION
XxXxxxxx is due the greater of the Annual Processing Fees or the Minimum Annual
Fee.
--------------------------------------------------------------------------------
Annual Processing Fees Third Party
Administration
--------------------------------------------------------------------------------
Policy/Contract Issue Fee Per Policy/Contract $30.00
--------------------------------------------------------------------------------
Variable Universal Life
Policy Administration Fee per Policy
--------------------------------------------------------------------------------
From 0 -10,000 Policies $54.00
--------------------------------------------------------------------------------
From 10,001 - 20,000 Policies $48.00
--------------------------------------------------------------------------------
From 20,001 - 50,000 Policies $45.00
--------------------------------------------------------------------------------
From 50,001 - 100,000 Policies $42.00
--------------------------------------------------------------------------------
Above 100,000 Policies $40.00
--------------------------------------------------------------------------------
--------------------------------------------------------------------------------
Variable Annuity
Policy Administration Fee per Contract
--------------------------------------------------------------------------------
From 0 - 10,000 Policies $48.00
--------------------------------------------------------------------------------
From 10,001 - 20,000 Policies $45.00
--------------------------------------------------------------------------------
From 20,001 - 50,000 Policies $42.00
--------------------------------------------------------------------------------
From 50,001 - 100,000 Policies $40.00
--------------------------------------------------------------------------------
Above 100,000 Policies $38.00
--------------------------------------------------------------------------------
3
25
EXHIBIT D
ANNUAL FEE SCHEDULE FOR VARIABLE UNIVERSAL LIFE POLICY AND
VARIABLE ANNUITY CONTRACT ADMINISTRATION
----------------------------------------------------------------
MINIMUM ANNUAL FEE THIRD PARTY
ADMINISTRATION
----------------------------------------------------------------
Contract Year 1 $300,000
----------------------------------------------------------------
Contract Year 2 $340,000
----------------------------------------------------------------
Contract Year 3 $380,000
----------------------------------------------------------------
Contract Year 4 $420,000
----------------------------------------------------------------
Contract Year 5 & beyond $480,000 *
----------------------------------------------------------------
* Inflation Adjusted
4
26
EXHIBIT D
MONTHLY FEE SCHEDULE FOR VARIABLE UNIVERSAL LIFE POLICY AND
VARIABLE ANNUITY CONTRACT ADMINISTRATION
BASE ADMINISTRATION FEES
The TPA fees are broken into several categories.
Base Administration Fees are banded based on the number of policies in force.
The Fees are as follows:
--------------------------------------------------------------------------------
REGISTERED VARIABLE UNIVERSAL LIFE
--------------------------------------------------------------------------------
Monthly Processing Fees per Policy
--------------------------------------------------------------------------------
From 0 -10,000 Policies $4.50
--------------------------------------------------------------------------------
From 10,001 - 20,000 Policies $4.00
--------------------------------------------------------------------------------
From 20,001 - 50,000 Policies $3.75
--------------------------------------------------------------------------------
From 50,001 - 100,000 Policies $3.50
--------------------------------------------------------------------------------
Above 100,000 Policies $3.35
--------------------------------------------------------------------------------
REGISTERED VARIABLE ANNUITY
--------------------------------------------------------------------------------
Monthly Processing Fee per Contract
--------------------------------------------------------------------------------
From 0 - 10,000 Policies $4.00
--------------------------------------------------------------------------------
From 10,001 - 20,000 Policies $3.75
--------------------------------------------------------------------------------
From 20,001 - 50,000 Policies $3.50
--------------------------------------------------------------------------------
From 50,001 - 100,000 Policies $3.35
--------------------------------------------------------------------------------
Above 100,000 Policies $3.20
--------------------------------------------------------------------------------
The total fee charged each month will be the maximum of the Minimum Monthly Fee
or the sum of the Base Administration Fee and the included Function Specific
Fees.
--------------------------------------------------------------------------------
MINIMUM FEES PER CONTRACT YEAR Monthly Fee
--------------------------------------------------------------------------------
Contract Year 1 $25,000
--------------------------------------------------------------------------------
Contract Year 2 $28,300
--------------------------------------------------------------------------------
Contract Year 3 $31,700
--------------------------------------------------------------------------------
Contract Year 4 $35,000
--------------------------------------------------------------------------------
Contract Year 5 & beyond $40,000 *
--------------------------------------------------------------------------------
* Inflation Adjusted
5
27
EXHIBIT D
FEE SCHEDULE FOR VARIABLE UNIVERSAL LIFE POLICY AND
VARIABLE ANNUITY CONTRACT ADMINISTRATION
FUNCTION SPECIFIC FEES
In addition to the Base Administration Fees, the Function Specific Fees are
listed below:
-------------------------------------------------------------------------------------------------
POLICY/CONTRACT REPORTING FEES FEE
-------------------------------------------------------------------------------------------------
Additional Copies Fee - The Base Administration Fee provides $5.00
copies of each policy owner report to the owner and servicing agent.
This is the charge per policy for each copy in excess of the Base.
-------------------------------------------------------------------------------------------------
Benefit Statement Frequency Fee - The Base Administration Fee $5.00
provides Benefit Statements on a quarterly basis. This is the charge
per policy for each mailing in excess of four per year.
-------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------
POLICY/CONTRACT ISSUE RELATED FEES (PER POLICY ISSUED) FEE
-------------------------------------------------------------------------------------------------
Application Data Entry Fee - The Base Administration Fee $15.00
includes processing electronic census data. This fee covers
the expense of manually capturing and entering the application data.
-------------------------------------------------------------------------------------------------
Policy Page Reporting Fee - This is the fee per policy issued $15.00
for printing, assembling and distributing the policy page kits
in excess of one per policy.
-------------------------------------------------------------------------------------------------
6
28
EXHIBIT D
FEE SCHEDULE FOR VARIABLE UNIVERSAL LIFE POLICY AND
VARIABLE ANNUITY CONTRACT ADMINISTRATION
FUNCTION SPECIFIC FEES
--------------------------------------------------------------------------------------------------------
FUND RELATED FEES FEE
--------------------------------------------------------------------------------------------------------
If Customer sends
For each fund MSLLC is required to value, MSLLC will, on fund AUV on paper,
valuation days and upon receipt of the Net Asset Value (NAV) or $1.50 per fund, per
Asset Unit Value (AUV): (i) Compute mortality & expense charge; day additional
(ii) Compute Unit Value; (iii) Update the Price Table; (iv) Create charge. If
accounting journal entries. Customer sends
AUV
electronically, no
additional charge.
If Customer sends
NAV on paper,
$1.50 per fund, per
day additional
charge. If
Customer sends
NAV
electronically, no
additional charge.
If MSLLC
calculates AUV,
$1.00 per fund, per
day additional
charge.
--------------------------------------------------------------------------------------------------------
Fund Trading Advice - The Base Administration Fee includes $2.50
producing an electronic feed of fund
trading activity to the entity to the fund
administration provider. This is the fee
per Fund Manager for each day a fund is
traded for providing manual advice of
trading activity.
--------------------------------------------------------------------------------------------------------
Price Correction Fee - The Base Administration Fee provides Time & Materials
for price correction related Undo/Redo
processing once per month for each fund. If a fund has more than one price
correction per month that requires Undo/Redo processing, this work will be
performed on a Time & Materials basis in excess of the Minimum Monthly
Charge.
--------------------------------------------------------------------------------------------------------
7
29
EXHIBIT D
FEE SCHEDULE FOR VARIABLE UNIVERSAL LIFE POLICY AND
VARIABLE ANNUITY CONTRACT ADMINISTRATION
FUNCTION SPECIFIC FEES
------------------------------------------------------------------------------------------------------------------
POLICY/CONTRACT ASSET RELATED SERVICES FEE
------------------------------------------------------------------------------------------------------------------
Perform the following policy asset related services: (i) Process Limit 1 per policy,
rebalance of assets; (ii) Process transfer of assets; (iii) Process per month. If over
reallocation of assets; (iv) Process dollar cost averaging of assets; (v) - $5 per policy, per
Process change in investment allocations; (vi) Create accounting transaction.
journal entries.
------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------
FINANCIAL REPORTING FEES FEE
------------------------------------------------------------------------------------------------------------------
Base administration fee provides electronic data feed for periodic $5.00 per report
insurance carrier financial reporting. This is the charge for printed
copies.
------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------
STANDARD DATA INTERFACES COVERED BY BASE FEE FEE
------------------------------------------------------------------------------------------------------------------
Provide Customer with a standard data interface for which the $25 per occurrence
operational support is covered by the base fee for the following: (i) for processing
Accounting; (ii) Commissions; (iii) Valuation; (iv) Trades; and (v) additional
Reinsurance for Variable Universal Life Policies and Tax Reporting interfaces.
for Variable Annuity Contracts.
------------------------------------------------------------------------------------------------------------------
Accept standard data interface from the Customer for Pricing (Unit $25 per occurrence
Value or Share Price for Unit Value Calculation). for processing
additional
interfaces.
------------------------------------------------------------------------------------------------------------------
8
30
EXHIBIT D
FEE SCHEDULE FOR VARIABLE UNIVERSAL LIFE POLICY AND
VARIABLE ANNUITY CONTRACT ADMINISTRATION
FUNCTION SPECIFIC FEES
ADDITIONAL FEE SCHEDULE
------------------------------------------------------------------------------------------------------------------
SEPARATE ACCOUNT RECONCILIATION FEE FEE
------------------------------------------------------------------------------------------------------------------
Separate Account Reconciliation Fee - This is the fee per month $250.00
for each fund for which XxXxxxxx Systems performs reconciliation to
the Separate Account records.
------------------------------------------------------------------------------------------------------------------
------------------------------------------------------------------------------------------------------------------
VPAS(R) AGENT COMPENSATION SYSTEM FEE
------------------------------------------------------------------------------------------------------------------
For periodic Broker/Dealer payment cycle processing, MSLLC will Flat Charge:
(i) compute commission payments; (ii) produce summary reports or $1,000 per pay
electronic data feed to Broker/Dealer; (iii) Create journal entries. cycle.
------------------------------------------------------------------------------------------------------------------
For periodic commission payment processing, MSLLC will (i) Flat charge: $1,000
Compute commission payments; (ii) Produce agent level commission per cycle, plus
statements and reports; (iii) Produce disbursement requests; (iv) $2.00 per agent,
Create journal entries; per pay cycle.
------------------------------------------------------------------------------------------------------------------
Create checks or wire transfers. $2.50 per check or
wire transfer.
------------------------------------------------------------------------------------------------------------------
1099 Preparation-Electronic transmission to IRS. $2.50 per 1099 for
paper copy.
Electronic
transmission, no
additional charge.
------------------------------------------------------------------------------------------------------------------
9
31
EXHIBIT D
FEE SCHEDULE FOR VARIABLE UNIVERSAL LIFE POLICY AND VARIABLE
ANNUITY CONTRACT ADMINISTRATION
FUNCTION SPECIFIC FEES
ADDITIONAL FEE SCHEDULE
------------------------------------------------------------------------------------------------------------------
REMOTE ACCESS SUBJECT TO SECURITY AUTHORIZATION FEE
------------------------------------------------------------------------------------------------------------------
Wide Area Network access from designated Customer Customer is responsible
office(s), providing inquiry and report request capability. for cost of acquisition,
installation and
maintenance of any
hardware, software and
telecommunication lines
required for remote
system connectivity.
------------------------------------------------------------------------------------------------------------------
Dial In access by Customer employees, providing inquiry Customer is responsible
access, and by designated agents/brokers, providing policy for cost of acquisition,
inquiry and report request capability. installation and
maintenance of any
hardware, software and
telecommunication lines
required for remote
system connectivity.
------------------------------------------------------------------------------------------------------------------
Internet access by Customer employees, designated Monthly access charge
agents/brokers and policy owners, providing policy inquiry of $150 plus a per
and report request capability. kilobyte charge for
Customer's actual band
width usage. Charges per
kilobyte are subject to
change consistent with
any increase or decrease
in rates charged by
Internet Service
Provider.
------------------------------------------------------------------------------------------------------------------
10
32
------------------------------------------------------------------------------------------------------------------
Internet access by Customer employees providing file transfer Monthly access charge
capability. of $150 plus a per
kilobyte charge for
Customer's actual band
width usage. Charges per
kilobyte are subject to
change consistent with
any increase or decrease
in rates charged by
Internet Service
Provider. Monthly
access charge will be
waived if Customer is
using Internet access for
policy inquiry or report
requests.
------------------------------------------------------------------------------------------------------------------
Interactive Voice Response access by agents/brokers and Included in base fee.
policy owners, providing policy inquiry and report request
capability.
------------------------------------------------------------------------------------------------------------------
FEE SCHEDULE FOR VARIABLE UNIVERSAL LIFE POLICY AND VARIABLE
ANNUITY CONTRACT ADMINISTRATION
FUNCTION SPECIFIC FEES
ADDITIONAL FEE SCHEDULE
------------------------------------------------------------------------------------------------------------------
AFTER HOURS FUNCTIONS FEE
------------------------------------------------------------------------------------------------------------------
Processing of one standard cycle per day. Any additional
cycle processing
billed at T&M
rates.
------------------------------------------------------------------------------------------------------------------
11
33
EXHIBIT E
PRODUCTS
To be determined.
12
34
EXHIBIT F
SCHEDULE OF AUTHORIZED PERSONNEL
The following individuals are authorized to give instructions or direction
to XxXxxxxx with respect to matters arising in connection with the servicing to
be performed under this Agreement:
Authorized Individual Name
Authorized Individual Name
13
35
EXHIBIT G
INSURANCE COVERAGE
XxXxxxxx will maintain the following coverages during the term of this
Agreement:
Worker's Compensation at statutory limits;
Employers Liability, with $500,000 limit of liability;
Commercial General Liability including Products - Completed
Operations coverage with Broad Form Contractual coverage
with the following limits of liability:
with a combined single limit of $1,000,000 for Bodily
Injury and Property Damage;
(ii) $1,000,000 limit of liability for
Aggregate Products-Completed Operations and
Property Damages; and
$1,000,000 General Aggregate;
Automobile Liability, with a combined single limit of liability of
$1,000,000/accident;
Crime Insurance policy with limits of $5,000,000;
Errors and Omissions policy with limits of $5,000,000
(g) Umbrella/Excess Liability insurance with a $4,000,000 limit of
liability.
14
36
EXHIBIT H
SOFTWARE ESCROW AGREEMENT
THIS SOFTWARE ESCROW AGREEMENT is entered into as of the 1st day of
Month, Year, by and among XxXxxxxx Systems, L.L.C., a Georgia limited liability
corporation (hereinafter referred to as "XxXxxxxx"), Company Complete Name, a
Stock/Mutual company registered under the laws of the State of _______
(hereinafter referred to as "Company") and Fort Xxxx Escrow Services, Inc., a
Georgia corporation (hereinafter referred to as "Escrow Agent").
WHEREAS, XxXxxxxx and Company are parties to that certain Remote
Processing Agreement, dated as of __________, (the "Remote Processing
Agreement"), pursuant to which XxXxxxxx agreed to provide certain corporate life
remote processing services specified therein with respect to the Policies (as
defined in the Master Remote Processing Agreement); and
WHEREAS, XxXxxxxx or its agents may utilize the Software
(defined below) in the discharge of their obligations owing to Company under the
Master Remote Processing Agreement; and
WHEREAS, for the Term of the Master Remote Processing Agreement, the
uninterrupted availability, maintenance and support of the Software is critical
to Company in the conduct of its business; and
WHEREAS, the parties hereto desire that the Escrow Agent hold,
administer and dispose of certain forms of computer software, certain computer
systems documentation, and certain computer data in accordance with the terms
and conditions of this Agreement,
NOW, THEREFORE, in consideration of the foregoing and of the mutual
promises contained herein, the parties hereto agree as follows:
SECTION 1 DEFINITIONS.
As used in this Agreement, the following terms shall have the
meaning set forth:
1.01 Software. "Software" means VPAS(R) Life, a group of computer
programs and associated database dictionaries utilized by XxXxxxxx in the
discharge of XxXxxxxx'x obligations under the Master Remote Processing
Agreement; provided, however, that Software shall not include any computer
software
H-1
37
EXHIBIT H
SOFTWARE ESCROW AGREEMENT
programs which are licensed by XxXxxxxx from third-parties.
1.04 Software License Agreement. "Software License Agreement" means
the nonexclusive license executed and delivered by the parties hereto, granting
by XxXxxxxx to Company, upon the occurrence of a Release Event (as hereinafter
defined), a limited right to use the Software for the sole and exclusive purpose
of performing the Remote Processing Services with respect to the Policies.
1.05 Deposit Copies. "Deposit Copies" means the specific items to be
deposited in escrow by XxXxxxxx. "Deposit Copy" shall mean any one of the
Deposit Copies. Deposit Copy shall include (i) the source code form of the
Software, (ii) all documentation and procedure manuals used by XxXxxxxx to
operate the Software, (iii) documentation which would enable Company to execute
the Software on a computer, which will include instructions for restoring the
Software, documentation manuals, and procedure manuals from the escrow media,
and (iv) a list of all third-party software and hardware used by XxXxxxxx to
operate the Software.
SECTION 2 ACCEPTANCE OF ESCROW.
The Escrow Agent is hereby appointed escrow agent to hold,
administer and dispose of the copies described in SECTION 4 hereof and the
Escrow Agent hereby accepts such appointment.
SECTION 3 ESCROW ACCOUNT.
The Escrow Agent shall hold and administer the Deposit Copies in
escrow (the "Escrow Account") in accordance with the terms and conditions
hereof. The Escrow Agent shall accept the deposit of the Deposit Copies and
shall acknowledge the deposit by giving written notice of deposit to Company.
Upon its receipt and acceptance of the Deposit Copies, the Escrow Agent shall
place the same in its media vault located at 0000 Xxxxxxxx Xxxxxxx, Xxxxx 000
Xxxxxxxx Xx. (the "Media Vault") and shall not disclose, use, copy, convey or
otherwise transfer the Deposit Copies, except in accordance with the provisions
of this Agreement.
SECTION 4 DEPOSITS.
H-2
38
EXHIBIT H
SOFTWARE ESCROW AGREEMENT
4.1 Initial Deposit. Within thirty (30) days after the execution of
this Agreement, XxXxxxxx shall deposit with the Escrow Agent for the account of
Company one (1) copy of the Deposit Copy.
4.2 Subsequent Deposits. Monthly, during the Term, XxXxxxxx shall
deposit with the Escrow Agent, to be held in accordance with the terms and
conditions of this Agreement, one up-to-date copy of the Deposit Copy and shall
give written notice to Company that such deposit has been made. Upon its receipt
and acceptance of such deposit, the Escrow Agent shall place the same in the
Media Vault and shall not disclose, use, copy, convey or otherwise transfer the
updated Deposit Copy, except in accordance with the provisions of this
Agreement. Upon the Escrow Agent's acceptance of such deposit, the updated
Deposit Copies shall be subject to all provisions of this Agreement.
4.3. No Transfer of Title to Deposit Copies. Simultaneous with the
deposit of any Deposit Copy, the Escrow Agent shall be vested with the right to
process, utilize and transfer such Deposit Copy, subject to the terms and
conditions set forth herein. The Escrow Agent shall not be vested with any
ownership rights or title to the Deposit Copies.
SECTION 5 ADMINISTRATION OF ESCROW ACCOUNT.
5.1 Standard of Care. The Escrow Agent shall exercise a
professional standard of care in carrying out the terms of this Agreement. The
Escrow Agent shall take no action in connection with or relating to this
Agreement and the Deposit Copies hereunder, except upon written notice of
instruction from Company. The Escrow Agent shall not be responsible for failure
to fulfill its obligations under this Agreement due to causes beyond its
control, nor shall the Escrow Agent assume any obligation or liability for any
transaction between XxXxxxxx and Company other than its obligations, as escrow
agent, with respect to the Deposit Copies hereunder.
5.2 Limitations of Duty of the Escrow Agent. The Escrow Agent is
acting as a bailee hereunder and shall not be under any duty to give the Deposit
Copies held hereunder any greater degree of care than it gives its own similar
property. Fort Xxxx shall have no obligation to verify the accuracy or
completeness of any deposit materials. In addition, the Escrow Agent shall use
its reasonable efforts to protect against environmental deterioration of the
Deposit Copies as a result of its being stored in accordance with the terms
hereof; provided, however, that the Escrow Agent shall not be required to
H-3
39
EXHIBIT H
SOFTWARE ESCROW AGREEMENT
handle the Deposit Copies in a manner that differs materially from the manner in
which it handles similar media for customers receiving services substantially
similar to those being provided under this Agreement. The Escrow Agent may act
in reliance upon any instruction, instrument or signature believed by it to be
genuine and may assume that any person purporting to give any writing, notice,
request, advice or instruction in connection with or relating to this Agreement
has been duly authorized to do so. The Escrow Agent and its officers, directors,
associates and employees shall not be liable for any mistake of fact or error of
judgment or for any acts or omissions of any kind unless caused by their willful
misconduct or gross negligence. Any liability of Fort Xxxx, regardless of the
reason shall be limited to the fees exchanged under this agreement. The Escrow
Agent shall not be liable for special, indirect, incidental or consequential
damages hereunder. This Agreement shall constitute notice to any person or
entity who shall acquire a right of access to the Deposit Copies that the Escrow
Agent's duty is limited as set forth herein.
5.3 Indemnification of Escrow Agent. XxXxxxxx and Company, jointly
and severally, shall defend, indemnify and hold harmless the Escrow Agent from
and against all claims, actions and suits, whether in contract or in tort, and
from and against any and all liabilities, losses, damages, costs, charges,
penalties, counsel fees and other expenses of any nature (including, without
limitation, reasonable attorneys fees and expenses and settlement costs)
incurred by the Escrow Agent as a result of performance of this Agreement except
to the extent they result from the Escrow Agent's gross negligence or willful
misconduct.
5.4 Escrow Agent Non-disclosure Obligations. Except as provided in
this Agreement, the Escrow Agent shall not divulge, disclose, otherwise make
available to third parties, or make any use whatsoever of the Deposit Copies, or
of any information provided to it by XxXxxxxx or Company in connection with this
Agreement, without the express prior written consent of XxXxxxxx and Company.
This obligation will continue indefinitely notwithstanding termination of this
Agreement.
5.5 Copying of Deposit Copies. The Escrow Agent shall make copies of
the Deposit Copies only as necessary to preserve and safely store the Deposit
Copies and to provide copies thereof, as authorized herein, to Company. The
Escrow Agent shall reproduce on all copies of the Deposit Copies made by the
Escrow Agent any proprietary or confidentiality notices contained in the Deposit
Copies originally deposited with it by XxXxxxxx.
H-4
40
EXHIBIT H
SOFTWARE ESCROW AGREEMENT
5.6 Inspection of Escrow Account. The Escrow Agent shall keep
records of its activities undertaken and materials prepared pursuant to this
Agreement. During the term of this Agreement, XxXxxxxx and Company shall be
entitled at reasonable times, during normal business hours and upon reasonable
notice to the Escrow Agent, (i) to inspect the records of the Escrow Agent with
respect to this Agreement and the Escrow Agent's performance hereunder; and (ii)
to inspect at the facilities designated by the Escrow Agent, accompanied by a
designated employee of the Escrow Agent, the physical status and condition of
the Deposit Copies.
5.7 Verification of Deposit Copies.
(a) Requested Verification. If requested by Company, the
Escrow Agent or its designee shall, at Company's sole cost and expense, verify
the Deposit Copies for accuracy, completeness and sufficiency and issue the
results of such verification in writing to Company. The Escrow Agent shall issue
a copy of the verification results to XxXxxxxx. The Escrow Agent shall be
prohibited from appointing a designee to perform the verification procedures set
forth in this SECTION 5.7(a) unless such designee agrees in writing to be bound
by the terms and conditions of this Agreement. For purposes of this SECTION
5.7(a), Revision Labs is expressly approved as designee of the Escrow Agent. In
the event the Escrow Agent shall desire to utilize the services of any other
designee, it shall obtain the prior written approval of Company as to the
identity of such designee, which approval shall not be unreasonably withheld or
delayed.
(b) Verification Support. The Escrow Agent or its designee
shall have the right, upon not less than thirty (30) days' notice, to use the
facilities of XxXxxxxx, for a charge of $2,000 per day to Company, including
without limitation XxXxxxxx'x computer systems, to verify the Deposit Copies,
but only in the presence of, and with the assistance of, XxXxxxxx'x Director of
Data Processing or such other person as designated by XxXxxxxx. XxXxxxxx shall
make available any technical and support personnel reasonably necessary for the
Company to perform verification of the Deposit Copies. Company shall reimburse
XxXxxxxx for any out-of-pocket expenses incurred. Company agrees that such use
of XxXxxxxx'x facilities shall be limited to once every twelve (12) months and
shall not interfere with XxXxxxxx'x performance of the Remote Processing
Services.
(c) Release of Other Information. Upon request by Company and
upon notice to
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EXHIBIT H
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XxXxxxxx, the Escrow Agent shall release to Company information pertaining to
directory lists and/or table of contents of computer media, manuals, schematics
and manufacturing documents in respect of the Deposit Copies.
(d) Observation. If requested by Company, XxXxxxxx shall
permit one employee of Company to be present to observe the compilation or other
verification of the Deposit Copies by the Escrow Agent.
5.8 Compliance with Laws. Each party hereto shall comply with all
Federal, state, county and local laws, ordinances, regulations and codes
applicable to the performance of this Agreement.
5.9 Return of Superseded Deposit Copies. Whenever an updated copy of
the Deposit Copy is deposited with the Escrow Agent, the Escrow Agent shall
return to XxXxxxxx all superseded copies of the Deposit Copy except for (i) the
most recently deposited updated copy; (ii) the copy immediately preceding such
updated copy; and (iii) the most recent copy for which verification pursuant to
SECTION 5.7 has been performed, each such returned copy to be free and clear of
this Agreement.
SECTION 6 RELEASE OF DEPOSIT COPIES FROM ESCROW AGENT.
6.1 Release Event. A Release Event is defined as a breach of the
Master Remote Processing Agreement by XxXxxxxx pursuant to SECTION 8.04 thereof
and failure to cure such breach within the applicable cure period specified in
the Master Remote Processing Agreement.
6.2 Release of Deposit Copies and Software License. Company shall
deliver to the Escrow Agent and XxXxxxxx a written statement signed by a partner
or director of Company stating that a Release Event has occurred and that copies
of the statement were deposited postage prepaid in the United States Mail,
registered or certified, return receipt requested, addressed to XxXxxxxx at its
last known address (a "Release Notice"). Such Release Notice shall, as between
Company and the Escrow Agent, be conclusive and dispositive evidence of the
occurrence of a Release Event. The Escrow Agent shall promptly, within two (2)
business days after receipt of such Release Notice from Company, deliver the
Deposit Copies and the Software License Agreement (as defined below) to Company.
During any period of time in which the Deposit Copies are in the possession of
Company, the Deposit Copies shall be
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subject to, and maintained by Company in accordance with, (i) the terms of this
Agreement, and (ii) the terms and conditions of the Software System License
Agreement.
If the Escrow Agent shall transfer to Company the nonexclusive
rights to the Software which have been vested in the Escrow Agent hereunder, the
Escrow Agent's obligations hereunder with respect to the Deposit Copies shall
terminate. The Escrow Agent shall not release the Deposit Copies to XxXxxxxx,
except upon expiration of the Term or upon termination of the Master Remote
Processing Agreement.
6.3 Release Event Dispute. XxXxxxxx and Company agree that Company
will be irreparably damaged if the Escrow Agent fails to release the Deposit
Copies to Company upon receipt of a Release Notice from Company. Therefore, even
if XxXxxxxx disputes the occurrence of the event(s) described in a Release
Notice, the Escrow Agent shall nevertheless promptly deliver the Deposit Copies
to Company. In the event Company shall cause the Deposit Copies to be improperly
released from escrow, XxXxxxxx shall have the right to seek damages and
injunctive relief requiring Company to return any and all Deposit Copies to
XxXxxxxx and to cease and desist any and all use of the Deposit Copies. Subject
to the foregoing, all parties hereto reserve all other rights they may have to
prosecute or contest the claim for damages and injunctive relief and hereby
reserve all other legal and equitable rights and remedies they may have.
SECTION 7 SOFTWARE LICENSE AGREEMENT.
7.1 Software License Agreement. Contemporaneously with the execution
of this Agreement, the parties hereto shall execute and deliver the Software
License Agreement to the Escrow Agent to be held in accordance with the terms
hereof.
7.2 License. If the Deposit Copies are released from the Escrow
Account to Company by the Escrow Agent in accordance with the terms and
conditions hereof, XxXxxxxx shall xxxxx Company a license for the use by Company
of the Deposit Copies and any modifications, updates, corrections or
enhancements thereof made by or for Company, only upon and subject to the terms
and condition of the Software License Agreement.
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SECTION 8 REPRESENTATIONS AND WARRANTIES.
8.1 Representations and Warranties of XxXxxxxx. XxXxxxxx represents
and warrants to Company and the Escrow Agent as follows:
(a) Software. (i) The initial and subsequent deposit of copies
of the Software constitute accurate copies of the Software; (ii) the Deposit
Copies deposited in the Escrow Account at any given time in the future shall
correspond to the most recent release, modification or revision to the Software
as of the date of deposit; and (iii) the Deposit Copies will be physically
useable.
(b) Non-infringement and Authority. XxXxxxxx further
represents and warrants as follows: (i) to the best of its knowledge, the
Software does not infringe on any patent, copyright or trade secret, process or
design owned or claimed by any third party; (ii) it has all requisite power and
authority to deposit the Deposit Copies with the Escrow Agent pursuant to the
terms of this Agreement and to grant the License pursuant to the Software
License Agreement; (iii) the License will be the legal, valid and binding
obligation of XxXxxxxx, enforceable against XxXxxxxx according to its terms,
except as enforceability may be limited by applicable bankruptcy,
reorganization, insolvency, moratorium or any other similar laws affecting
generally the enforcement of creditors' rights as from time to time are in
effect and to general principles of equity, regardless of whether such
enforceability is considered in a proceeding in equity or at law; (iv) it has
all requisite power and authority to enter into this Agreement and the execution
and delivery of this Agreement and the performance by it of its obligations
hereunder has been duly authorized; and (v) the execution of this Agreement by
XxXxxxxx will not violate any contract, judgment, decree or other agreement
under which it is currently obligated, which violation would have a material
adverse effect on the ability of XxXxxxxx to deliver the Deposit Copies to the
Escrow Agent pursuant to the terms hereof.
8.2 Representations and Warranties of the Escrow Agent. The Escrow
Agent hereby represents and warrants to Company and XxXxxxxx as follows: The
Escrow Agent has all requisite power and authority to enter into this Agreement
and has all requisite power and authority to perform its obligations hereunder.
The execution and delivery by the Escrow Agent of this Agreement and the
performance by the Escrow Agent of its obligations hereunder have been duly
authorized. This Agreement has been duly executed and delivered by the Escrow
Agent. This Agreement constitutes the
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EXHIBIT H
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legal, valid and binding obligation of the Escrow Agent, enforceable against the
Escrow Agent in accordance with its terms, except as enforceability may be
limited by applicable bankruptcy, reorganization, insolvency, moratorium or any
other similar laws affecting generally the enforcement of creditors' rights as
from time to time are in effect and to general principles of equity, regardless
of whether such enforceability is considered in a proceeding in equity or at
law.
8.3 Representations and Warranties of Company. Company hereby
represents and warrants to the Escrow Agent and XxXxxxxx as follows: Company has
all requisite power and authority to enter into this Agreement and has all
requisite power and authority to perform its obligations hereunder. The
execution and delivery by Company of this Agreement and the performance of
Company hereunder has been duly authorized, and no other acts or proceedings on
the part of Company are necessary to authorize the execution, delivery and
performance of this Agreement. This Agreement has been duly executed and
delivered by Company. This Agreement constitutes the legal, valid and binding
obligation of Company, enforceable against Company in accordance with its terms,
except as enforceability may be limited by applicable bankruptcy,
reorganization, insolvency, moratorium or any other similar laws affecting
generally the enforcement of creditors' rights as from time to time are in
effect and to general principles of equity, regardless of whether such
enforceability is considered in a proceeding in equity or at law.
SECTION 9 MISCELLANEOUS.
9.1 Escrow Fees. Simultaneously herewith, Company will paid the
Escrow Agent the first year's escrow fees specified in Schedule A, and Company
shall pay all applicable annual, renewal, deposit, release, service and other
fees specified in Schedule A in accordance with the payment terms thereof.
9.2 Term. This Agreement shall become effective upon the date hereof
(the "Effective Date"), and shall end on the first to occur of (i) the end of
the term of the Master Remote Processing Agreement; (ii) termination of the
Master Remote Processing Agreement by Mutual Agreement pursuant to SECTION 8.01
thereof; (iii) termination of the Master Remote Processing Agreement by Either
Party pursuant to SECTION 8.02 thereof; (iv) termination of the Master Remote
Processing Agreement by Non-renewal pursuant to SECTION 8.03 thereof; or (v)
termination of this Agreement by Company upon written notice to the Escrow Agent
and XxXxxxxx.
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EXHIBIT H
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9.3 Effect of Termination. Upon non-renewal or other termination of
this Agreement, all duties and obligations of the Escrow Agent to XxXxxxxx and
Company shall terminate. Upon termination of this Agreement, the Deposit Copies
delivered to the Escrow Agent pursuant to the terms hereof shall be returned to
XxXxxxxx by the Escrow Agent; provided, however, that if the Deposit Copies have
been released by the Escrow Agent to Company prior to the Termination Date
pursuant to the terms hereof, the Software License Agreement shall survive
termination of this Agreement in accordance with its terms.
9.4 Disputes. Any dispute in connection with this Agreement and the
transactions contemplated hereunder shall be submitted to any court in, of, or
for the State of Georgia. Company is authorized to institute action in any court
in, of, or for the State of Georgia, to resolve the dispute, including seeking
preliminary and permanent relief which may be warranted at any stage of such
proceeding. Legal fees incurred by the parties hereto in connection with any
dispute under this Agreement shall be subject to SECTION 7.3 of the Master
Remote Processing Agreement.
9.5 Assignment. Neither this Agreement nor any rights hereunder, in
whole or in part, shall be assignable or otherwise transferable by XxXxxxxx or
Company and any assignment or transfer in violation of this provision shall be
deemed null and void, unless such assignment shall be permitted under the terms
of the Master Remote Processing Agreement; provided, however, that as a
condition of any such permitted assignment by any party, its permitted assignee
shall agree in writing to be bound by the provisions of this Agreement.
Performance of obligations hereunder by a permitted assignee of any party hereto
shall be deemed to be performance by such party.
9.6 Resignation of the Escrow Agent. The Escrow Agent may resign at
any time by giving a minimum of sixty (60) days prior written notice of
resignation to the parties hereto, such resignation to be effective on the date
specified in such notice. The Deposit Copies held by the Escrow Agent under the
terms hereof shall be delivered to a successor escrow agent designated in
writing jointly by XxXxxxxx and Company, to be held on the terms and conditions
of this Agreement. If no successor escrow agent has been appointed as of the
effective date of the resignation, all obligations of the Escrow Agent hereunder
shall nevertheless cease and terminate, except that the Escrow Agent's sole
responsibility thereafter shall be to keep safely all Deposit Copies then held
by it and to deliver the same to a person jointly designated by XxXxxxxx and
Company or in accordance with the directions of a final order or
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EXHIBIT H
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judgment of a court of competent jurisdiction.
9.7 Governing Law. This Agreement will be governed by and construed
in accordance with the laws of the State of Georgia, without giving effect to
the principles of conflicts of laws thereof.
9.8 Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
9.9 Titles and Subtitles. Any titles, subtitles or table of contents
used in this Agreement are used for convenience only and are not to be
considered in construing or interpreting this Agreement.
9.10 Notices. Any notice required or permitted under this Agreement
shall be delivered personally, telegraphed, telexed, sent by facsimile
transmission or sent by certified, registered or express mail, postage prepaid
and return receipt requested. Any such notice shall be deemed given when so
delivered personally, telegraphed, telexed or sent by facsimile transmission or,
if mailed upon receipt as follows:
(a) If to Company:
Company
Street
City, State, Zip
Attention: Name/Title
Facsimile Number: (Xxx) Xxxxxxx
(b) If to XxXxxxxx:
XxXxxxxx Systems, L.L.C.
0000 Xxxxxx Xxxxx Xxxx
Xxxxx Xxxxx
Xxxxxxx, XX 00000
Attention: J. Xxxxxx Xxxxxxx, Jr., Vice Chairman
Facsimile Number: (000) 000-0000
(c) If to the Escrow Agent:
Fort Xxxx Escrow Services
0000 Xxxxxxxx Xxxxxxx, Xxxxx 000
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Xxxxxxxx, XX 00000
Attention: Xxxxxxx Xxxxxxxxx
Facsimile Number: (000) 000-0000
9.11 Amendments and Waivers. Any provisions of this Agreement may be
amended and the observance of any provision of this Agreement may be waived
(either generally or in a particular instance and either retroactively or
prospectively), only with the written consent of the party against whom such
amendment or waiver is to be enforced.
9.12 Severability. In the event that any one or more of the
provisions contained in this Agreement, or in any other document, agreement or
instrument referred to herein, shall, for any reason, be held to be invalid,
illegal or unenforceable in any respect, such invalidity, illegality or
unenforceability shall not affect any other provision of this Agreement or any
other such document, agreement or instrument.
IN WITNESS WHEREOF, the parties have executed this Agreement as of
the date first written above.
XxXxxxxx Systems, L.L.C. Company Complete Name
By: By:
---------------------------------- -------------------------------
J. Xxxxxx Xxxxxxx, Jr., Vice Chairman NAME/TITLE
FORT XXXX ESCROW SERVICES
By:
----------------------------------
President
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EXHIBIT H
SOFTWARE ESCROW AGREEMENT
SCHEDULE A
FEES
FEES TO BE PAID BY LICENSEE SHALL BE AS FOLLOWS:
Initialization fee (one time only) $ 850
($765 for current clients)
Annual Maintenance Fee $ 900/product
Includes two Deposit Material updates
Includes one cubic foot of storage space
International (outside of U.S.) - $1000/product
Additional Updates (above two per year) $ 150
Additional Storage Space $ 150/cubic ft/year
PAYABLE BY LICENSEE OR PRODUCER:
Due upon Licensee's or Producer's
Request for Release of Deposit Materials $ 100 for initial two
hours
$50/hour for additional hours
A ten percent discount is credited towards the initialization fee for current
Fort Xxxx clients. Fees due upon receipt of signed contract or Deposit Material,
whichever comes first and shall be paid in U.S. Dollars. The renewal date for
this Agreement will occur on the anniversary of the first invoice. Thereafter,
fees shall be subject to their current pricing, provided that such prices shall
not increase by more than 10 percent per year.
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EXHIBIT I
SAMPLE SOFTWARE LICENSE AGREEMENT
THIS SOFTWARE LICENSE AGREEMENT is entered into as of the 3rd day of
September, 1999, by and between XxXxxxxx Systems, L.L.C., a Georgia limited
liability corporation (hereinafter referred to as "XxXxxxxx") and Farmers New
World Life Insurance Company, a stock/mutual company registered under the laws
of the State of _____, (hereinafter referred to as "FNWL").
WHEREAS, XxXxxxxx and FNWL are parties to that certain Master
Administration Agreement, dated as of September 3, 1999 (the "Master
Administration Agreement"), pursuant to which XxXxxxxx has agreed to perform
certain Administration services specified therein with respect to the
Policies/Annuity Contracts/Annuity Contracts (defined below); and
WHEREAS, the parties hereto have entered into a Software Escrow
Agreement of even date herewith (the "Software Escrow Agreement") pursuant to
which XxXxxxxx will deliver to Fort Xxxx Escrow Services, Inc., as the Escrow
Agent, the Software (defined below) which is utilized in the administration of
the Policies/Annuity Contracts (as defined in the Master Administration
Agreement); and
WHEREAS, the parties have agreed that, in the event the Software is
delivered by the Escrow Agent to FNWL upon the occurrence of a Release Event,
FNWL is to have a license to use the Software solely on the terms and conditions
of this Agreement,
NOW, THEREFORE, for and in consideration of the mutual covenants and
conditions hereinafter set forth, and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto
hereby agree as follows:
SECTION 1 DEFINITIONS.
As used in this Agreement, the following terms shall have the
meaning set forth:
1.01 Escrow Agent. "Escrow Agent" means Fort Xxxx Escrow Services,
Inc., a Georgia corporation.
1.02 License Term. "License Term" means the period
commencing on release of the
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EXHIBIT I
SAMPLE SOFTWARE LICENSE AGREEMENT
Deposit Copies pursuant to SECTION 6.2 of the Software Escrow Agreement and
ending on the earlier of (i) that date on which no Policies/Annuity Contracts
shall remain in effect, (ii) any breach of this Agreement or (iii) that date on
which the Initial Term of the Master Administration Agreement was set to expire.
1.03 Policies. "Policies" means, collectively, the insurance
policies included within one of the Products and "Policy" means any one of the
Policies.
1.04 Contracts. "Contracts" mean, collectively, the annuity
contracts included within one of the Products and "Contract" means any one of
the Annuity Contracts.
1.05 Products. "Products" means the insurance and annuity products
described in Exhibit E of the Master Administration Agreement and made a part
hereof.
1.06 Software. "Software" means VPAS(R) Life Administration System,
a group of computer programs and associated database data dictionaries utilized
by XxXxxxxx in the discharge of XxXxxxxx'x obligations under the Master
Administration Agreement; provided, however, that Software shall not include any
computer software programs which are licensed by XxXxxxxx from third-parties.
SECTION 2 LICENSE.
XxXxxxxx hereby grants to FNWL a nonexclusive and royalty-free
license, transferable only as specifically permitted pursuant to this Agreement,
to use, during the License Term, the copies of the Software and updates thereto
which are deposited with the Escrow Agent pursuant to the Software Escrow
Agreement (the "Deposit Copies"), for the sole and exclusive purpose of
performing the Administration Services with respect to the Policies/Annuity
Contracts, subject only to the restrictions set forth herein. Anything in this
Agreement to the contrary notwithstanding, this License shall become effective
and the rights granted to FNWL hereunder shall arise if, and only if, the
Deposit Copies shall be properly delivered by the Escrow Agent to FNWL in
accordance with the terms and conditions of the Software Escrow Agreement.
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SECTION 3 NO PAYMENT.
XxXxxxxx acknowledges and agrees that it shall receive no
compensation, royalty, license fee or other payment from FNWL in connection with
the license granted pursuant to this Agreement.
SECTION 4 LIMITATIONS ON USE.
FNWL shall use the Software during the License Term solely for the
purpose of performing the Administration Services with respect to the
Policies/Annuity Contracts. In the event that FNWL, either itself or through its
agents or its affiliates or their agents, shall use the Software for any purpose
which is not specifically permitted by the terms of this Agreement, the License
granted hereunder shall be revoked and shall be of no further force or effect.
SECTION 5 ASSIGNMENT BY FNWL.
XxXxxxxx acknowledges that, during the License Term, FNWL may engage
third-parties to perform the administration of the Policies/Annuity Contracts.
FNWL shall have the right to sublicense the Software to any such third party,
during the License Term, but only if such third-party shall agree in writing, as
a condition precedent to the effectiveness of such assignment, to be bound by
all of the terms and conditions of this Agreement and the Master Insurance
Administration Agreement and such writing shall be delivered to XxXxxxxx.
SECTION 6 NO SUPPORT SERVICES.
FNWL acknowledges and agrees that XxXxxxxx shall not be required to
perform or provide any installation, maintenance or support services to FNWL
with respect to the license granted under this Agreement.
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EXHIBIT I
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SECTION 7 WARRANTY.
XxXxxxxx warrants to FNWL that the Software will function so as to
allow for the administration of the Policies/Annuity Contracts in substantially
the same manner in which such Policies/Annuity Contracts are administered as of
the date the Software was deposited with the Escrow Agent; provided, however,
that this warranty shall terminate immediately in the event FNWL makes any
modification, enhancement or other change to the Software. EXCEPT AS EXPRESSLY
SET FORTH IN THIS SECTION 7, XXXXXXXX MAKES NO EXPRESS OR IMPLIED WARRANTY
WHATSOEVER, WHETHER OF MERCHANTABILITY, OF FITNESS FOR A PARTICULAR PURPOSE OR
OTHERWISE.
SECTION 8 TERMINATION.
In the event FNWL shall breach or otherwise violate any term or
condition of this Agreement during the License Term, which breach or violation
shall not be cured within ten (10) business days after receipt of written notice
of such breach or violation from XxXxxxxx, XxXxxxxx shall have the right to
terminate this Agreement upon written notice to FNWL.
SECTION 9 DUTIES UPON TERMINATION.
Upon termination of this Agreement, whether upon the expiration of
the License Term or otherwise, FNWL shall, within ten (10) business days after
the date of such termination, deliver to XxXxxxxx at FNWL's sole cost and
expense, all copies of the Software and other items contained in the Deposit
Copy and shall cease all further use of the Software.
SECTION 10 CONFIDENTIALITY.
(a) Without XxXxxxxx'x prior written consent, FNWL shall not in any
manner or form disclose, provide or otherwise make available, in whole or in
part, the Software, or anything contained in the Deposit Copy, other than (i) to
its employees in the scope of their employment; (ii) to any permitted assignee
under SECTION 5 hereof; and (iii) to FNWL's independent auditors, legal counsel
and other agents, but in all such cases FNWL shall use its reasonable efforts to
have each such person, receiving such disclosure, agree in writing to protect
the confidentiality of the Software and other items contained in the Deposit
Copy. FNWL
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EXHIBIT I
SAMPLE SOFTWARE LICENSE AGREEMENT
shall take all appropriate action to satisfy its obligations under this
Agreement with respect to the use and confidentiality of the Software. FNWL
shall not, without XxXxxxxx'x prior written consent, disclose, transfer or
transmit, in whole or in part in any manner, the Software or any information
which can permit the duplication, recreation or other utilization of any
proprietary or confidential information of XxXxxxxx embodied in the Software or
associated documentation and procedures contained in the Deposit Copy.
(b) FNWL acknowledges and agrees that a breach or contemplated
breach by FNWL of this SECTION 10 will result in irreparable injury to XxXxxxxx.
Therefore, in the event of any breach or contemplated breach of this SECTION 10,
in addition to all other remedies provided at law or in equity, XxXxxxxx shall
be entitled to both preliminary and permanent injunctive relief to prevent a
breach or a contemplated breach of this SECTION 10.
SECTION 11 MISCELLANEOUS.
11.1 Binding Effect; Assignment. This Agreement shall be binding
upon and shall inure to the benefit of the parties hereto and their respective
successors and permitted assigns. No party to this Agreement may assign its
rights or delegate its duties hereunder without the prior written consent of the
other party hereto.
11.2 Governing Law. This Agreement will be governed by and construed
in accordance with the laws of the State of Georgia.
11.3 Notices. Any notice or other communication required or
permitted hereunder shall be in writing and shall be delivered personally,
telegraphed, telexed, sent by facsimile transmission or sent by certified,
registered or express mail, postage prepaid and return receipt requested. Any
such notice shall be deemed given when so delivered personally, telegraphed,
telexed or sent by facsimile transmission or, if mailed, three (3) days after
the date of deposit in the United States mail, as follows:
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EXHIBIT I
SAMPLE SOFTWARE LICENSE AGREEMENT
(a) If to FNWL:
Farmers New World Life Insurance Company
0000 - 00xx Xxxxxx X.X.
Xxxxxx Xxxxxx, XX 00000
Attention: ______________
_________________________
Facsimile Number: (___) ________
(b) If to XxXxxxxx:
XxXxxxxx Systems, L.L.C.
0000 Xxxxxx Xxxxx Xxxx
Xxxxx Xxxxx
Xxxxxxx, XX 00000
Attention: J. Xxxxxx Xxxxxxx, Jr.
Vice Chairman
Facsimile Number: (000) 000-0000
11.4 Severability. In the event that any one or more of the
provisions contained in this Agreement, or in any other document, agreement or
instrument referred to herein, shall, for any reason, be held to be invalid,
illegal or unenforceable in any respect, such invalidity, illegality or
unenforceability shall not affect any other provision of this Agreement or any
other such document, agreement or instrument.
11.5 No Third-Party Beneficiaries. Nothing in this Agreement is
intended or shall be construed to give any person, other than the parties
hereto, any legal or equitable right, remedy or claim under or in respect of
this Agreement or any provision contained herein.
11.6 Effect of Article and Section Headings. The Article and Section
headings herein are for convenience only and shall not affect the construction
of this Agreement.
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EXHIBIT I
SAMPLE SOFTWARE LICENSE AGREEMENT
11.7 Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original but all of which will
constitute one and the same document.
11.8 Entire Agreement. This Agreement, and the agreements
contemplated hereby, contain the entire understanding of the parties with
respect to the subject matter hereof and thereof, and no representation,
warranty, covenant or agreement not embodied herein or therein, or oral or
otherwise, shall be of any force or effect whatsoever. Further, no change,
amendment or modification of this Agreement shall be effective unless in writing
and signed by all of the parties hereto.
11.9 Waiver. A waiver of any default or breach hereunder granted by
any party hereto shall not constitute a waiver by such party of any other
default or breach or a waiver by such party of the same default or breach at a
later time. Further, to be effective, any such waiver must be in writing and be
signed by the party granting such waiver.
IN WITNESS WHEREOF, the parties hereto have caused this License
Agreement to be executed and delivered by their duly authorized officers or
partners (as the case may be), all as of the date first above written.
XxXxxxxx Systems, L.L.C.
By:
--------------------------------
J. Xxxxxx Xxxxxxx, Jr.
Vice Chairman
Farmers New World Life Insurance Company
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SAMPLE SOFTWARE LICENSE AGREEMENT
By:
-----------------------------
Name
Title
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