EXHIBIT 10.19
SOFTWARE SUPPORT AND MAINTENANCE AGREEMENT
THIS SOFTWARE SUPPORT AND MAINTENANCE AGREEMENT (the "Agreement") is made
to be effective as of January 1, 2004 (the "Effective Date") and is by and among
CENTURY SURETY COMPANY, an Ohio corporation ("Century"), EVERGREEN NATIONAL
INDEMNITY COMPANY, an Ohio corporation ("Evergreen"), and CONTINENTAL HERITAGE
INSURANCE COMPANY, an Ohio corporation ("CHIC"). Evergreen and CHIC are
hereinafter sometimes referred to collectively as the "Companies" and each
individually as a "Company." All references herein to the "parties" or a "party"
refer to Century, on the one hand, and the Companies (or either of them), on the
other hand.
RECITALS
WHEREAS, Century and the Companies have entered into a Software License
Agreement on even date herewith ("Software License Agreement"), whereby Century
has granted a nonexclusive, royalty-free perpetual license to certain
proprietary software known as CIMS to each of the Companies (the "CIMS
Software"); and
WHEREAS, the Companies now desire to retain Century to provide certain
technical support and maintenance services for the CIMS Software and other
software ("Non-Proprietary Software") as further identified on Schedule 1
attached hereto (collectively, the "Software"), and Century desires to provide
such support and maintenance services to the Companies, all pursuant to and
under the terms and conditions of this Agreement.
NOW THEREFORE, in consideration of the foregoing recitals and the mutual
covenants and agreements hereinafter set forth, the parties agree as follows:
ARTICLE 1.
SUPPORT SERVICES BY CENTURY
1.1 SCOPE OF SUPPORT: Pursuant to this Agreement and the terms and
conditions contained herein, Century shall provide services to the Companies for
the Software in accordance with the scope of services set forth on Schedule 2
attached hereto (the "Support Services"). Such Support Services shall include
such access and license to upgrades, patches and new releases of the CIMS
Software as may be developed by Century, in its sole discretion, from time to
time. Notwithstanding the foregoing, nothing herein shall be construed to
require Century to issue and/or develop such upgrades, updates, patches or new
releases to the CIMS Software. Except as may be otherwise expressly provided in
this Agreement, Century shall be under no obligation to provide any additional
support services or other services to the Companies, and the Support Services
shall be limited to those services specifically listed in Schedule 2 attached
hereto. Further, nothing herein shall require Century to provide, and Century
shall not provide and the Companies shall not accept, any Support Services with
respect
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to the Non-Proprietary Software in violation of Century's license agreement with
the owner or vendor of such Non-Proprietary Software.
1.2 SUPPORT USAGE: Payment by the Companies of the Annual Support and
Maintenance Fee set forth in Article 2 herein shall entitle the Companies to use
of the Support Services on an as-needed basis during the Term of this Agreement.
Century shall be under no obligation whatsoever to provide any support,
maintenance, upgrades, patches or new versions if the Companies fail to pay the
applicable Annual Support and Maintenance Fees, nor shall Century be under any
obligation to provide any upgrades, new versions or enhancements of any kind to
the Software after termination of this Agreement for any reason. Any software
programs not listed on Schedule 1 attached hereto shall not be deemed a part of
this Agreement or of Century's support and maintenance obligations hereunder.
Under no circumstances will Century be obligated to support any Software which
Century no longer supports for its own operations.
1.3 LICENSE TO UPGRADES AND RELEASES: So long as the Companies have paid
all applicable Annual Support and Maintenance Fees set forth in Article 2
herein, upon termination of this Agreement for any reason other than for a
breach by the Companies, the Companies shall have a nonexclusive, fully paid up,
royalty free, perpetual license to use and modify, for the Companies' business
operations, the CIMS Software, including upgrades, patches and new releases
thereof, released by Century up to the termination date and/or through the
annual period for which the Companies have paid all such applicable Annual
Support and Maintenance Fees. In addition to the restrictions set forth in
Section 7.12, the license granted herein shall not permit the Companies, and the
Companies shall be prohibited from, copying the CIMS Software for sale, license,
lease, rental or other transaction to any third-parties (other than an affiliate
(within the meaning of Ohio Revised Code Section 3901.32) of such party,
provided that such affiliate may use and disclose the Confidential Information
only if and to the extent that the Companies may do so under the terms of this
Agreement); provided further, that the Companies shall not be prohibited from
providing copies of the CIMS Software to a third-party who is not a competitor
of Century for the sole purpose of permitting such third-party to provide
integration or similar services to the Companies, for their own internal
business purposes, so long as the Companies by contract prohibit such third
party from disclosing or using the CIMS Software for any purpose other than to
provide such services to the Companies. The license granted herein for upgrades,
patches and releases shall be null and void, and all rights shall be retained by
Century, if the Companies fail to pay the applicable Annual Support and
Maintenance Fees.
1.4 ADDITIONAL SERVICES: Should the Companies desire Century to provide
additional services for customization or modifications to the CIMS Software
("Additional Services"), the Companies may make such requests of Century, and
Century shall consider such requests in good faith. However, any requests by the
Companies for such Additional Services shall be subject to the following:
(a) if the Additional Services requested by the Companies pertain
directly to the existing functionality of a then current version of the
CIMS Software, Century will
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provide such Additional Services to the Companies, subject to Sections
1.4(c) and 1.4(d) hereof;
(b) if the Additional Services requested by the Companies do not
pertain directly to the existing functionality of a then current version
of the CIMS Software, Century shall consider such request in good faith,
but shall have no obligation to perform such Additional Services for the
Companies, and Century shall have no liability or obligations whatsoever
to the Companies with respect to such Additional Services requested by the
Companies that Century declines to perform pursuant to this Section
1.4(b);
(c) should Century provide Additional Services pursuant to Section
1.4(a), or should Century, in its sole and absolute discretion, provide
Additional Services pursuant to Section 1.4(b), the parties agree to
negotiate in good faith an arms-length transaction governing the scope,
payment and all other details regarding such Additional Services. Should
Century provide Additional Services pursuant to either 1.4(a) or 1.4(b),
the Companies agree to pay Century for the Additional Services, on a time
and materials basis, and Century will xxxx the Companies at customary
market hourly rates and fees, and costs, including per diem and travel
charges, if applicable, for any such Additional Services;
(d) under no circumstances will Century be required to deploy
additional internal personnel and/or resources to provide Additional
Services to the Companies. Century will, in its sole and absolute
discretion, determine what personnel and resources it will utilize for the
Additional Services, and Century shall have full rights and authority, in
its sole and absolute discretion, to outsource any and/or all of the
Additional Services to outside vendors, consultants and/or third-parties.
Century will have no liability whatsoever with respect to any Additional
Services outsourced to third-parties. Any fees, costs, charges and
expenses related to Additional Services billed by third-parties and/or
outside consultants or vendors will be passed through to the Companies,
and the Companies shall bear the full and absolute responsibility for
payment to such third-party vendors and/or consultants. In addition to its
other indemnification obligations contained herein, the Companies shall
fully defend, indemnify and hold Century harmless from and against any and
all claims, damages, losses, judgments and expenses, including reasonable
attorney's fees, arising out of, or related to the Companies' failure to
pay any such third-party vendors and/or consultants;
(e) so long as the Companies have paid in full all applicable fees
and charges for any and all Additional Services as agreed between the
parties, upon termination of this Agreement for any reason other than for
a breach by the Companies, the Companies shall have a nonexclusive, fully
paid up, royalty free, perpetual license to use and modify the CIMS
Software as modified by the Additional Services for the Companies'
business operations. In addition to the restrictions set forth in Section
7.12, the license granted
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herein shall not permit the Companies, and the Companies shall be
prohibited from, copying the CIMS Software for sale, license, lease,
rental or other transaction to any third-parties (other than an affiliate
(within the meaning of Ohio Revised Code Section 3901.32) of such party,
provided that such affiliate may use and disclose the Confidential
Information only if and to the extent that the Companies may do so under
the terms of this Agreement); provided further, that the Companies shall
not be prohibited from providing copies of the CIMS Software to a
third-party who is not a competitor of Century for the sole purpose of
permitting such third-party to provide integration or similar services to
the Companies, for their own internal business purposes, so long as the
Companies by contract prohibit such third party from disclosing or using
the CIMS Software for any purpose other than to provide such services to
the Companies. The license granted herein shall be null and void, and all
rights shall be retained by Century if the Companies fail to pay any and
all fees and charges for such Additional Services. Century shall not be
under any obligation to provide any additional services, customizations,
upgrades, updates, new versions or enhancements relating to the CIMS
Software, after termination of this Agreement for any reason.
ARTICLE 2.
FEES
2.1 ANNUAL FEE FOR SUPPORT AND MAINTENANCE: In exchange for Century's
provision of the Support Services, the Companies jointly and severally agree to
pay Century, subject to the Limitations imposed in Section 2.4 and the further
limitations and requirements set forth in Section 7.13 hereof, an Annual Support
and Maintenance Fee of One Hundred Thousand Dollars ($100,000.00), per annum.
This Annual Support and Maintenance Fee shall not cover or include any
Additional Services or other services that may be provided to the Companies by
Century pursuant to Section 1.4 herein.
2.2 PAYMENT TERMS FOR ANNUAL SUPPORT AND MAINTENANCE FEE: The Annual
Support and Maintenance Fee shall be due and payable quarterly, in advance, in
four equal quarterly installments, with each installment being due and payable
on the first day of each calendar quarter during which this Agreement is in
effect. The Annual Support and Maintenance Fee shall be prorated on a daily
basis for periods during which this Agreement is in effect which constitute less
than a full calendar quarter. Any payment due under this Agreement which remains
unpaid after the due date shall accrue interest per annum at the rate equal to
the prime rate of interest listed in the Wall Street Journal (Midwest Edition)
as part of its daily report on money rates plus one percent (1%) on the date the
payment was due until the date it is paid.
2.3 RENEGOTIATION OF ANNUAL SUPPORT AND MAINTENANCE FEE. (A) At the
request of either party on or about the first year anniversary of this
Agreement, the Annual Support and Maintenance Fee shall be reviewed by both
parties to determine if adjustments are necessary or appropriate. If the actual
usage of the Support Services compared to that reasonably anticipated by the
parties as of the date of this Agreement (based on historical usage), or any
other material increase or material decrease in the level of Support Services
provided to the Companies, has
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occurred, the parties shall renegotiate the Annual Support and Maintenance Fee
in good faith. Any such adjustment must be agreed to in writing by both parties.
(B) In the event that, at any time during the term of this Agreement, the
combined annualized gross written premiums of the Companies exceed, or are
anticipated to exceed, Fifty Million Dollars ($50,000,000.00), Century shall
have the right to increase the Annual Support and Maintenance Fee; provided that
the amount of such increase shall be negotiated in good faith by the parties.
Any such increase must be agreed to in writing by both parties. In calculating
the annualized gross written premiums of the Companies for this purpose,
premiums for bail business shall be determined on a gross premium basis.
2.4 LIMITATIONS ON ANNUAL SUPPORT AND MAINTENANCE FEE. Notwithstanding
anything in this Article 2 or otherwise to the contrary, for so long as Century
and the Companies are "affiliates" within the meaning of Ohio Revised Code
Section 3901.32, the Annual Support and Maintenance Fee shall be equal to an
amount which is no greater than that permitted pursuant to Ohio Revised Code
Section 3901.34(A), and no adjustment in the Annual Support and Maintenance Fee
shall become effective until the parties have complied with the notice
requirements of Ohio Revised Code Section 3901.341.
ARTICLE 3.
DUTIES OF THE COMPANIES
DUTIES: The Companies shall:
(a) pay all fees under this Agreement as they become due;
(b) designate primary and alternate personnel contacts for purposes
of obtaining and providing Support Services under this Agreement;
(c) install and use the current or immediate prior release of the
Software on the Companies' system in accordance with the instructions and
documentation provided by Century;
(d) provide Century with dial-in or internet access to the
Companies' computer system during Century's regular support hours upon
request, and/or, at Century's discretion, provide and facilitate its own
dial-in or internet access to Century's computer system with assistance
from Century as reasonably required;
(e) provide notice and documentation of any Software problems or
errors to Century in a timely manner; and
(f) obtain and maintain all licenses necessary for the Companies to
use the Non-Proprietary Software and receive the Support Services with
respect thereto, and to indemnify and hold Century harmless against any
claim by any third party that the
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Company does not have the right to use and receive the Support Services
with respect to the Non-Proprietary Software;
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ARTICLE 4.
WARRANTIES
4.1 WARRANTIES: Century hereby represents and warrants that the Support
and Maintenance Services provided under this Agreement shall be performed in a
workmanlike manner, with professional diligence and skill; provided, however,
that ultimate Software testing and acceptability with respect to the Software,
Support and Maintenance Services and Additional Services is the sole
responsibility of the Companies, and Century makes no representations or
warranties with respect to same.
4.2 DISCLAIMER OF ALL OTHER WARRANTIES: THE LIMITED WARRANTY SET FORTH IN
THIS ARTICLE 4 IS IN LIEU OF ALL OTHER WARRANTIES, EXPRESSED OR IMPLIED OR
OTHERWISE, FOR THE PRODUCTS OR SERVICES. THE SOFTWARE, SUPPORT AND MAINTENANCE
SERVICES AND ADDITIONAL SERVICES ARE PROVIDED BY CENTURY TO THE COMPANIES ON AN
"AS IS" AND "WHERE IS" BASIS AND CENTURY SPECIFICALLY DISCLAIMS ANY AND ALL
WARRANTIES OF ANY KIND, WHETHER EXPRESS, IMPLIED, OR OTHERWISE ARISING OUT OF OR
RELATED TO THIS AGREEMENT, INCLUDING, WITHOUT LIMITATION, ANY WARRANTY OF
MERCHANTABILITY, OR FITNESS FOR A PARTICULAR PURPOSE, AND ALL SUCH WARRANTIES
ARE EXPRESSLY HEREBY EXCLUDED BY AGREEMENT OF THE PARTIES. THE PARTIES FURTHER
AGREE THAT THIS AGREEMENT IS FOR THE PROVISION OF SERVICES AND THAT THEREFORE,
THE PROVISIONS OF THE UNIFORM COMMERCIAL CODE SHALL NOT APPLY TO THIS AGREEMENT.
ARTICLE 5.
LIMITATION OF LIABILITY
LIMITATION OF REMEDIES AND LIABILITIES: The Companies agree that Century's
liability and the Companies' sole and exclusive remedy pursuant to any claim of
any kind, including but not limited to a claim in contract, negligence,
professional malpractice or strict liability, against Century or any of its
affiliates, shall be the re-performance of the Support Services or Additional
Services during the Term. UNDER NO CIRCUMSTANCES SHALL CENTURY OR ANY OF ITS
AFFILIATES HAVE ANY LIABILITY WHATSOEVER OF ANY KIND FOR ANY COMPENSATORY,
EXEMPLARY, PUNITIVE, SPECIAL, INDIRECT, INCIDENTAL OR CONSEQUENTIAL DAMAGES,
INCLUDING, BUT NOT LIMITED TO, LOSS OF PROFIT OR REVENUE, LOSS OF USE, LOST
PRODUCTION, OR CONSEQUENTIAL PROPERTY DAMAGE; COST OF CAPITAL; COST OF
REPLACEMENT EQUIPMENT; OR CLAIMS RESULTING FROM OR ARISING OUT OF THIS AGREEMENT
IN ANY MANNER.
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ARTICLE 6.
TERM AND TERMINATION
6.1 TERM: The term of this Agreement shall commence as of the Effective
Date, and continue for so long as the Companies shall pay the Annual Support and
Maintenance Fees and applicable fees for any Additional Services, unless sooner
terminated hereunder, pursuant to this Article 6 (the "Term").
6.2 TERMINATION FOR CONVENIENCE: At any time after the one (1) year
anniversary of the Effective Date, and provided that all applicable charges and
fees owed by the Companies have been paid in full, the Companies may terminate
this Agreement for convenience by providing ninety (90) days' prior written
notice to Century. At any time after the one (1) year anniversary of the
Effective Date, Century may terminate this Agreement for convenience by
providing one (1) year prior written notice to the Companies.
6.3 TERMINATION FOR BREACH: Either party may terminate this Agreement if
the other party is in material breach of any of its obligations under this
Agreement, and if the defaulting party fails to remedy such breach within thirty
(30) days after written notice of such breach (or be in the process of remedying
such breach if the remedy in good faith cannot be completed within the thirty
(30) day period). In case of a termination under the provisions of the previous
sentence, and except as limited by Articles 4 and 5 hereof, the non-defaulting
party may pursue any and all remedy available in law or in equity under
applicable law with respect to such breach, including, but not limited to,
injunctive relief. If Century terminates this Agreement for the Companies'
breach of non-payment, all rights to the CIMS Software and the Support Services
related to such non-payment shall immediately revert to Century and neither
Company shall have any further rights with respect to such Software and Support
Services. Notwithstanding the foregoing, nothing herein shall be construed to in
any way effect or terminate the prior license granted by Century to the
Companies in the Software License Agreements.
6.4 TERMINATION FOR CHANGE IN OWNERSHIP OR CONTROL: If, at any time after
Century and the Companies cease to be "affiliates" within the meaning of Ohio
Revised Code Section 3901.32, ProAlliance Corporation ceases to beneficially
own, directly or indirectly, a majority of the issued and outstanding voting
stock of one or both of the Companies, Century may terminate this Agreement (but
only with respect to the Company no longer beneficially owned by ProAlliance
Corporation, if not both Companies) upon not less than one hundred eighty (180)
days advance written notice to the Companies.
6.5 TERMINATION FOR BANKRUPTCY OR INSOLVENCY: Either party may terminate
this Agreement under the following circumstances:
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(a) immediately if the other party becomes the subject of a
liquidation or similar proceeding commenced under Chapter 3925, Ohio
Revised Code; applies for or consents to the appointment of a receiver;
makes a general assignment for the benefit of creditors' admits in writing
its inability to pay debts as they mature; files a petition or answer
seeking a reorganization or arrangement with creditors under any
insolvency law; or if a decree of any court is entered adjudging the party
to be insolvent or approving a reorganization or arrangement under any
insolvency law (which decree is not set aside within thirty days after it
is entered)
(b) immediately if the other party sells, pledges or assigns its
assets, or a majority of its assets to any third-party, or if said party
ceases to do business in the ordinary course.
6.6 TERMINATION RIGHTS: The rights of either party to terminate under this
Article 6 are cumulative and the existence of the right under any provision or
subsection in this Agreement is not exclusive of the right under any other
provision or subsection. Except for a termination pursuant to Section 6.2, or a
termination under Section 6.3 for Century's breach, upon any other termination
of this Agreement, all rights granted herein to the Companies shall terminate
and all such rights shall immediately revert to Century.
ARTICLE 7.
GENERAL
7.1 ASSIGNABILITY: Neither Company may not assign this Agreement, or any
of its or their rights or obligations hereunder, without the prior written
consent of Century which may be exercised in the sole discretion of Century. Any
attempted or purported assignment which is not in compliance with this Section
7.1 shall be null and void, and Century shall have no obligations to any such
purported assignees.
7.2 AMENDMENTS: No amendment, modification or waiver of any provision of
this Agreement shall be effective unless the same shall be in writing and signed
by each of the parties hereto. Any waiver of any provision of this Agreement
shall be effective only in the specific instance and for the specific purpose
for which made or given. For so long as Century and the Companies are
"affiliates" within the meaning of Section 3901.32, O.R.C., no amendment to this
Agreement shall become effective until the parties have complied with the notice
requirements of Section 3901.341, O.R.C.
7.3 GOVERNING LAW: This Agreement shall be governed by and construed in
accordance with the laws of the State of Ohio.
7.4 ENTIRE AGREEMENT: This Agreement and the Schedules hereto constitute
the entire agreement between the parties hereto pertaining to the subject matter
hereof and supersede all negotiations, preliminary agreements and proposals, and
all prior or contemporaneous discussions and understandings of the parties
hereto in connection with the subject matter hereof. All Exhibits attached
hereto are incorporated into this Agreement and constitute a part hereof.
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7.5 SEVERABILITY: In the event any provision of this Agreement shall, for
any reason, be held to be invalid, illegal or unenforceable in whole or in part,
the remaining provisions shall not be affected thereby and shall continue to be
valid and enforceable and if, for any reason, any applicable authority finds
that any provision of this Agreement is invalid, illegal or unenforceable as
written, but by limiting such provision it would become valid, legal and
enforceable, then such provision shall be deemed to be written, construed, and
enforced as so limited.
7.6 HEADINGS: The captions and headings of this Agreement are for
convenience of reference only and are not to be used to interpret, explain or
define the scope or extent of this Agreement or any of its terms or conditions.
7.7 STATUS OF PARTIES: Nothing contained in this Agreement and no action
taken by the parties pursuant hereto shall be deemed to constitute the parties a
partnership, an association, joint venture or other entity. Neither the
Companies nor Century has, and neither shall hold itself or themselves out as
having, any authority to enter into any contract or create any obligation or
liability on behalf of, in the name of, or binding upon the other, pursuant to
this Agreement.
7.8 NOTICE: All notices which either party may be required or desire to
give to the other party shall be in writing and shall be given by personal
service, telecopy, registered mail or certified mail (or its equivalent), or
overnight courier to the other party at its respective address or telecopy
telephone number set forth below. Mailed, notices and notices by overnight
courier shall be deemed to be given upon actual receipt by the party to be
notified. Notices delivered by telecopy shall be confirmed in writing by
overnight courier and shall be deemed to be given upon actual receipt by the
party to be notified.
If to Century: Century Surety Company
000 Xxxxxxxxx Xxxxxx
Xxxxxxxxxxx, Xxxx 00000
Attn: Xxxx X. Xxxxxxx, Executive Vice President
and Secretary
Telephone: 000-000-0000
Facsimile: 000-000-0000
xxxxxxxx@xxxxxxxxxx.xxx
If to the Companies: Evergreen National Indemnity Company and/or
Continental Heritage Insurance Company
000 Xxxxxxxxx Xxxxxx
Xxxxxxxxxxx, Xxxx 00000
Attn: Roswell X. Xxxxx, President
Telephone: 000-000-0000
Facsimile: 000-000-0000
xxxxxx@xxxxxxxxxxxxx.xxx
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A party may change its address or addresses set forth above by giving the other
party notice of the change in accordance with the provisions of this section.
7.9 HEADINGS. The section headings in this Agreement are solely for
convenience and shall not be considered in its interpretation. The recitals set
forth on the first page of this Agreement are incorporated into the body of the
Agreement. The Exhibit referred to in this Agreement is attached to this
Agreement and is incorporated into this Agreement. Unless the context clearly
indicates, words used in the singular include the plural, words in the plural
include the singular and the word "including" means "including but not limited
to".
7.10 WAIVER. The failure of either party at any time to require
performance by the other party of any provision of this Agreement shall not
affect in any way the foil right to require the performance at any subsequent
time. The waiver by either party of a breach of any provision of this Agreement
shall not be taken or held to be a waiver of the provision itself. Any course of
performance shall not be deemed to amend or limit any provision of this
Agreement. Any notice or demand desired or required to be given hereunder shall
be in writing and (unless otherwise specified herein) deemed given when
personally delivered (including delivery by commercial overnight courier
service), or when deposited in the United States mail, postage prepaid, sent
certified or registered, and addressed to the address set forth on the signature
page hereof, or to such other address or person as hereafter may be designated
in writing by the applicable party.
7.11 SUCCESSORS AND ASSIGNS: This Agreement shall be binding upon and
shall inure to the benefit of the parties hereto and their respective heirs,
successors, legal representatives and permitted assigns. Nothing in this
Agreement, express or implied, is intended to confer upon any party other than
the parties hereto (and their respective heirs, successors, legal representative
and permitted assigns) any rights, remedies, liabilities or obligations under or
by reason of this Agreement.
7.12 CONFIDENTIALITY. Each party acknowledges that the CIMS Software and
all business information relating thereto is propriety and confidential and
contains confidential information, trade secrets and other valuable proprietary
information (collectively with the CIMS Software, the "Confidential
Information"). Each party agrees not to, directly or indirectly, disclose,
disseminate or share the Confidential Information to or with any competitor of
the other party without the prior written consent of the other party; provided
however, that no party shall be prohibited hereby from disclosing, disseminating
or sharing the Confidential Information with a competitor who, at the time of
such disclosing, disseminating or sharing, is either (a) an affiliate (within
the meaning of Ohio Revised Code Section 3901.32) of such party, provided that
such affiliate may use and disclose the Confidential Information only if and to
the extent that the disclosing party may do so under the terms of this
Agreement; or (b) performing due diligence in connection with discussions
regarding a possible acquisition or affiliation, provided that such competitor
enters into a confidentiality agreement with the disclosing party which
prohibits such person's use or disclosure of the Confidential Information.
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7.13 REGULATORY ACCESS TO BOOKS AND RECORDS; SAP COMPLIANCE. The parties
shall make the records relating to this Agreement available to the Ohio
Department of Insurance for its review as soon as is reasonably practicable
after receiving a request for such records. Charges or fees for services
performed shall be reasonable and in conformity with statutory accounting
principles consistently applied. The books, accounts and records shall be so
maintained as to clearly and accurately disclose the nature and details of the
transactions, including such accounting information as is necessary to support
the reasonableness of the charges or fees to the respective parties. The
requirements of this Section 7.13 shall apply for so long as Century and the
Companies are "affiliates" within the meaning of Ohio Revised Code Section
3901.32.
To further clarify the intention of the parties hereto, so long as the
Companies remain affiliates as stated above, the reasonableness of the charges
or fees to the respective parties shall be construed as if a cost sharing
agreement and expenses shall be apportioned in accordance with SSAP 70,
"Allocation of Expenses."
Additionally, the quarterly advance installments of the Annual Support and
Maintenance Fee shall be reconciled by the parties (i.e. "true up") with
applicable actual costs (including all direct and indirect costs) on at least a
semi-annual basis with any differences between actual costs and compensation
paid under the Agreement shall be either carried forward or charged back to
Evergreen and CHIC.
When the parties are no longer considered affiliates pursuant to Section
3901.32, O.R.C., the true-up shall occur as soon as practicable thereafter.
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the
date first set forth above.
CENTURY: EVERGREEN:
Century Surety Company Evergreen National Indemnity Company
Accepted By: /s/ Xxxxxxxxxxx X. Xxxx Accepted By: /s/ Roswell X. Xxxxx
----------------------- -------------------------
Printed Name: Xxxxxxxxxxx X. Xxxx Printed Name: Roswell X. Xxxxx
---------------------- ------------------------
Title: President Title: President
----------------------------- -------------------------------
Date: January 1, 2004 Date: January 1, 2004
------------------------------ --------------------------------
CHIC:
Continental Heritage Insurance Company
Accepted By: /s/ Roswell X. Xxxxx
-------------------------
Printed Name: Roswell X. Xxxxx
------------------------
Title: President
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Date: January 1, 2004
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SCHEDULES TO BE ATTACHED:
(Attach all relevant schedules from the following list)
Schedule 1: Description of the Software pursuant for which Century will provide
Support
Schedule 2: Scope of Support Services provided by Century
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SCHEDULE 1
Description of CIMS Software and other Software to be governed by this
Agreement:
CIMS
The CIMS Software System consists of the following modules:
- Policy System
- Claims System
- Billing System
- Quote System
- Audit System
- Management Reporting
- Expense System
- Regulatory Communication and Control System (RCCS)
OTHER SOFTWARE (NON-PROPRIETARY SOFTWARE)
Other software consists of the following:
- Freedom Reinsurance System
- Great Plains Financials
- The Complete Package (annual statement)
- ImageRight Imaging System
- Onbase Imaging System
SCHEDULE 2
Description of Support and Maintenance Services
The technical support and maintenance services are:
Systems, Technical Support, Upgrades and Patches: Software updates and releases
will take place on systems located at Century. While the Software Support and
Maintenance Agreement is in effect Century will act as the technology department
for the Companies. General Release Software Upgrades are versions of the CIMS
Software that are released from time-to-time by Century in its sole discretion,
and incorporate changes that are enhancements to the CIMS Software, provided
however, any new software programs not listed on Schedule 1 attached hereto
shall not be deemed a part of this Agreement or of Century's support and
maintenance obligations hereunder. Patches are enhancements of the CIMS Software
that incorporate changes correcting specific problems that are sufficiently
important to warrant distribution prior to release of the next General Release
Software Upgrade.
Century will provide access to servers located at Century to support the
applications in Schedule 1. Century will provide support and maintenance on all
technologies necessary to support the software listed in Schedule 1.
Telephone and Electronic Support: During Century's Regular Support Hours,
Century shall provide telephone and electronic support to assist the Companies
in the use of the Software. Regular Support Hours are defined as 9:00 a.m. to
4:30 p.m. Eastern Time, Monday through Friday, excluding holidays observed by
Century. To use telephone support, personnel of the Companies shall call Century
at Century's support service telephone number which is 000-000-0000. For
electronic support, personnel of the Companies shall contact Century's support
personnel at xxxxxxxx@xxxxxxxxxxxxx.xxx. The support representative will work to
resolve the problem with the Companies' technical personnel. If deemed necessary
by Century's support representative, and agreed to by the Companies, Century
will access the Companies' computer via modem to aid in diagnosis of a problem.
