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EXHIBIT 10.1
BENEFITS ADMINISTRATION CONTRACT
THIS BENEFITS ADMINISTRATION CONTRACT ("Agreement") dated as
of July 1, 1997, is made by and between The Millers Mutual Fire Insurance
Company, a Texas mutual insurance company ("Millers Mutual"), and MiliRisk,
Inc., a Texas corporation ("MiliRisk," and together with Millers Mutual, the
"Parties").
PRELIMINARY STATEMENTS
A. Millers Mutual and MiliRisk are parties to a management
agreement, dated as of January 1, 1996 (the "Prior Agreement"), pursuant to
which Millers Mutual performs certain services for and on behalf of MiliRisk.
B. Millers Mutual and MiliRisk desire to amend in its entirety
the Prior Agreement.
C. MiliRisk desires to procure certain services from Millers
Mutual in connection with the business of MiliRisk and Millers Mutual is
willing to provide such services.
NOW, THEREFORE, in consideration of the foregoing preliminary
statements, the mutual covenants and agreements contained herein, the parties
hereto, intending to be legally bound hereby, agree to amend and restate in its
entirety the Prior Agreement as follows:
STATEMENT OF AGREEMENT
ARTICLE I.
DEFINITIONS
Unless the context otherwise requires, the terms defined in this
Article I shall, for the purposes of this Agreement, have the meanings herein
specified:
"Effective Date" means July 1, 1997.
"Fiscal Year" shall mean the period from January 1 through December 31
of each year.
"Term of Agreement" means the period from the Effective Date until the
Agreement is terminated pursuant to Article 5.
ARTICLE II.
DUTIES AND OBLIGATIONS OF MILLERS MUTUAL
Section 2.1 Benefits Administration Services. Millers Mutual
shall provide administrative and support services for and on behalf of MiliRisk
and its subsidiaries which shall include payroll and benefits administration.
Millers Mutual shall make available facilities and equipment as MiliRisk may
determine to be reasonably necessary in the conduct of its business
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including, but not limited to, business property and communications equipment,
whether owned or leased.
ARTICLE III.
COMPENSATION, EXPENSES AND PAYMENT
Section 3.1 Fee. The compensation due Millers Mutual from
MiliRisk for services provided pursuant to Section 2.1 of this Agreement shall
be a monthly fee of $15,000 (the "Monthly Fee").
Section 3.2 Invoicing and Payment. Millers Mutual shall xxxx
MiliRisk monthly for the Monthly Fee within 15 days after the end of each
calendar month during the Term of Agreement. Payment shall be made by MiliRisk
within 30 days after the delivery of such invoice.
Section 3.3 Late Payment. Any amount owing from MiliRisk to
Millers Mutual that has not been paid by the due date shall be subject to a
late payment charge of 1% per month.
ARTICLE IV.
ACCESS TO INFORMATION, BOOKS AND RECORDS
Millers Mutual and its duly authorized representatives shall have
access, to the extent necessary to perform the services pursuant to Section
2.1, to MiliRisk's offices, facilities and records wherever located, in order
to discharge Millers Mutual's responsibilities hereunder; provided, however,
MiliRisk shall provide and make available to Millers Mutual and its duly
authorized representatives at Millers Mutual's Fort Worth, Texas, USA offices,
at Millers Mutual's request, all such records required by Millers Mutual to
perform its duties pursuant to this Agreement. All records and materials
furnished to Millers Mutual by MiliRisk in performance of this Agreement shall
at all times during the Term of Agreement remain the property of MiliRisk.
ARTICLE V.
TERM AND TERMINATION OF THE AGREEMENT
Section 5.1 Initial Term. This Agreement shall be effective from
the Effective Date and shall continue for three (3) years thereafter (the
"Initial Term"); subject, however, to the terms of Section 5.2 hereof. At the
end of the Initial Term, this Agreement shall continue in force and effect for
subsequent one (1) year periods unless terminated by either Party by written
notice at least sixty (60) days prior to the anniversary date of the Effective
Date.
Section 5.2 Termination. This Agreement may be sooner terminated
on the first to occur of the following:
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(a) Termination by Mutual Agreement
In the event the Parties shall mutually agree in writing, this
Agreement may be terminated on the terms and dates stipulated
therein.
(b) Uncorrected Material Breach
In the event either Party shall fail to discharge any of its
material obligations hereunder, or shall commit a material
breach of this Agreement, and such default or breach shall
continue for a period of thirty (30) days after the other
Party has served notice of such default, this Agreement may
then be terminated at the option of the non-breaching Party by
notice thereof to the breaching Party.
Section 5.3 Effects of Termination. Except for covenants or
other provisions herein that, by their terms, expressly extend beyond the Term
of Agreement, the Parties' obligations hereunder are limited to the Term of
Agreement.
Section 5.4 Reimbursement by Millers Mutual. In the event of
termination under this Agreement, Millers Mutual shall reimburse MiliRisk
within 30 days after such termination for fees paid by MiliRisk but unearned by
Millers Mutual.
Section 5.5 Force Majeure. If either Party shall be prevented
from performing any portion of this Agreement (except the payment of money) by
causes beyond its control, including labor disputes, civil commotion, war,
governmental regulations or controls, casualty, inability to obtain material or
services or acts of God, the defaulting party shall be excused from performance
for the period of the delay and for a reasonable time thereafter.
ARTICLE VI.
INDEMNIFICATION OF MILLERS MUTUAL
Section 6.1 Limitation of Liability. In providing services
hereunder, Millers Mutual shall have a duty to act, and cause its affiliates
and designees to act, in a reasonably prudent manner. Neither Millers Mutual,
nor any officer, director, employee or agent of Millers Mutual shall be liable
to MiliRisk for any error of judgment or for any loss incurred by MiliRisk in
connection with the matters to which this Agreement relates, except a loss
resulting from the gross negligence or willful misconduct on the part of
Millers Mutual.
Section 6.2 Indemnification. MiliRisk hereby agrees to indemnify
and hold harmless Millers Mutual from and against any and all claims, causes of
action, liabilities, damages, costs, charges, fees, expenses (including
reasonable attorneys' fees and expenses to be reimbursed as incurred), suits,
orders, judgments, adjudications and losses of whatever nature and kind which
Millers Mutual or its affiliates or designees or for which Millers Mutual or
its affiliates or designees become liable as the result of the performance of
Millers Mutual's obligations and duties pursuant to this Agreement; provided,
Millers Mutual shall not be indemnified for gross negligence or willful
misconduct on the part of Millers Mutual.
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ARTICLE VII.
MISCELLANEOUS
Section 7.1 Relationship of Parties. This Agreement does not
create a partnership, joint venture or association; nor does this Agreement, or
the operations hereunder, create the relationship of lessor and lessee or
xxxxxx and bailee. Nothing contained in this Agreement or in any agreement
made pursuant hereto shall ever be construed to create a partnership, joint
venture or association, or the relationship of lessor and lessee or xxxxxx and
bailee, or to impose any duty, obligation or liability that would arise
therefrom with respect to either or both of the Parties. Specifically, but not
by way of limitation, except as otherwise expressly provided for herein,
nothing contained herein shall be construed as imposing any responsibility on
Millers Mutual for the debts or obligations of MiliRisk or any of its
affiliates. It is hereby expressly understood that Millers Mutual is hereby
engaged by MiliRisk to provide benefits administration services as an agent of
MiliRisk. Millers Mutual, its affiliates and designees shall have the right to
render similar services for other business entities and persons, including its
own, whether or not engaged in the same business as MiliRisk, and may enter
into such other business activities as Millers Mutual and its affiliates, in
their sole discretion, may determine.
Section 7.2 No Third Party Beneficiaries. Except to the extent a
third party is expressly given rights herein, any agreement herein contained,
expressed or implied, shall be only for the benefit of the Parties and their
respective legal representatives, successors and assigns, and such agreements
or assumption shall not inure to the benefit of any other party whomsoever, it
being the intention of the Parties hereto that no person or entity shall be
deemed a third party beneficiary of this Agreement except to the extent a third
party is expressly given rights herein.
Section 7.3 General Representations. Each Party represents and
warrants that on the Effective Date: (i) it is a corporation, duly established,
validly existing and in good standing under the laws of its state or
jurisdiction of incorporation, with power and authority to carry on the
business in which it is engaged and to perform its respective obligations under
this Agreement; (ii) the execution and delivery of this Agreement have been
duly authorized and approved by all requisite corporate action; (iii) it has
all the requisite corporate power and authority to enter into this Agreement
and to perform its obligations hereunder; and (iv) the execution and delivery
of this Agreement do not, and consummation of the transactions contemplated
herein will not, violate any of the provisions of its charter or bylaws or any
applicable state or federal laws applicable to them.
Section 7.4 Assignment. No assignment of this Agreement or any
of the rights or obligations set forth herein by either Party shall be valid
without the specific written consent of the other Party.
Section 7.5 Notices. All notices and other communications
hereunder shall be in writing and shall be deemed to have been duly given if
delivered personally, mailed by first class mail postage prepaid and return
receipt requested or sent by recognized overnight delivery service or facsimile
transmission to the address below indicated:
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If to Millers Mutual: The Millers Mutual Fire Insurance Company
000 Xxxxxxx Xxxxxx
Xxxx Xxxxx, Xxxxx 00000-0000
Attn: Xxx X. Xxxxxx
Facsimile: (000) 000-0000
If to MiliRisk: MiliRisk, Inc.
000 Xxxxxxx Xxxxxx
Xxxx Xxxxx, Xxxxx 00000-0000
Attn: Xxxxx X. Xxxxxx
Facsimile: (000) 000-0000
or such other address or to the attention of such other person as the recipient
party shall have specified by prior written notice to the sending party.
Notice so given shall, in the case of notice so given by mail, be deemed to be
given and received on the fourth calendar day after posting, in the case of
notice so given by recognized overnight delivery service, on the date of actual
delivery and, in the case of notice so given by facsimile transmission or
personal delivery, on the date of actual transmission or, as the case may be,
personal delivery.
Section 7.6 Failure to Pursue Remedies. The failure of any party
to seek redress for violation of, or to insist upon the strict performance of,
any provision of this Agreement shall not prevent a subsequent act, which would
have originally constituted a violation, from having the effect of an original
violation.
Section 7.7 Cumulative Remedies. The rights and remedies
provided by this Agreement are cumulative and the use of any one right or
remedy by any party shall not preclude or waive its right to use any or all
other remedies. Said rights and remedies are given in addition to any other
rights the parties may have by law, statute, ordinance or otherwise.
Section 7.8 Binding Effect. This Agreement shall be binding upon
and inure to the benefit of all of the parties and, to the extent permitted by
this Agreement, their successors, legal representatives and assigns.
Section 7.9 Interpretation. Throughout this Agreement, nouns,
pronouns and verbs shall be construed as masculine, feminine, neuter, singular
or plural, whichever shall be applicable. All references herein to "Articles,"
"Sections" and paragraphs shall refer to corresponding provisions of this
Agreement.
Section 7.10 Headings. Headings are solely for convenience and
ease of reference and are not to be considered in the construction or
interpretation of any provision of this Agreement.
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Section 7.11 Severability. The invalidity or unenforceability of
any particular provision of this Agreement shall not affect the other
provisions hereof, and this Agreement shall be construed in all respects as if
such invalid or unenforceable provision were omitted unless such invalid or
unenforceable provision affects the fundamental purpose of this Agreement.
Section 7.12 Counterparts. This Agreement may be executed in any
number of counterparts and by different parties hereto in separate
counterparts, with the same effect as if all parties hereto had signed the same
document. All such counterparts shall be deemed an original, shall be
construed together and shall constitute one and the same instrument. This
Agreement may also be executed and delivered by exchange of facsimile
transmissions of originally executed copies.
Section 7.13 Integration. This Agreement constitutes the entire
agreement among the parties hereto pertaining to the subject matter hereof and
supersedes all prior agreements and understandings pertaining thereto.
Section 7.14 GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY,
CONSTRUED AND ENFORCED IN ACCORDANCE WITH THE INTERNAL LAW, AND NOT THE LAW OF
CONFLICTS, OF THE STATE OF TEXAS.
Section 7.15 Arbitration.
(a) To the fullest extent permitted by law, any controversy or
claim arising out of or relating to any alleged breach shall be resolved by
arbitration by a panel of three (3) arbitrators under the American Arbitration
Association ("AAA") Arbitration Rules in force (the "AAA Rules") in accordance
with the following:
(1) In the event of any conflict between the AAA Rules and the
provisions of this Agreement, the provisions of this Agreement
shall prevail.
(2) Either party may refer a matter to arbitration by written
notice to the other party by giving notice as provided in this
Agreement.
(3) The place of the arbitration shall be Fort Worth, Texas.
(4) The claimant party shall appoint one arbitrator and the
respondent party shall appoint one arbitrator, and the two
arbitrators so appointed shall appoint the third arbitrator,
in accordance with the AAA Rules. In the event of an
inability to agree on a third arbitrator, the appointing
authority shall be the AAA.
(5) The decision of the arbitrators shall be made by majority vote
and shall be in writing.
(6) The decision of the arbitrators shall be final and binding on
the parties save in the event of fraud, manifest mistake or
failure by any of the arbitrators to disclose any conflict of
interest.
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(7) The decision of the arbitrators may be enforced by any court
of competent jurisdiction and may be executed against the
person and assets of the losing party in any jurisdiction.
(b) In the event any dispute is submitted to arbitration pursuant
to Section 7.15(a) above, the panel of arbitrators may, if it deems such award
appropriate, award a party costs and expenses incurred by such party in
enforcing its rights. Except as so awarded, each party shall bear its own
costs and expenses of enforcing its rights to arbitrate under this Section
7.15.
(c) Except for arbitration proceedings pursuant to Section 7.15(a)
above, no action (other than the enforcement of any arbitration decision) or
lawsuit shall be brought by or between MiliRisk and Millers Mutual concerning
or arising out of this Agreement.
Section 7.16 Agreement to Perform Necessary Acts. Each party
agrees to perform any further acts and execute and deliver any and all further
documents and/or instruments which may be reasonably necessary to carry out the
provisions of this Agreement and the transactions contemplated hereby.
[SIGNATURE PAGE FOLLOWS]
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed as of the date first above written.
THE MILLERS MUTUAL FIRE
INSURANCE COMPANY
By: /s/ XXX X. XXXXXX
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Name: Xxx X. Xxxxxx
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Title: Chief Financial Officer
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MILIRISK, INC.
By: /s/ F. XXXXXX XXXXXX, III
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Name: F. Xxxxxx Xxxxxx, III
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Title: President and Chief Executive Officer
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