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Exhibit (A)(8)(a)(i)
SERVICE AGREEMENT
THIS AGREEMENT, effective as of 12:01 A.M. (EDT), June 1, 1988, between
The Manufacturers Life Insurance Company, a mutual life insurance company
organized under the laws of Canada ("Manufacturers"), and The Manufacturers Life
Insurance Company of America, a stock life insurance company domiciled in the
Commonwealth of Pennsylvania ("Manufacturers of America").
WITNESSETH
WHEREAS, Manufacturers carries on the business of life insurance and
it's related products;
AND WHEREAS, Manufacturers of America carries on the business of life
insurance and its related products and is an indirect wholly-owned subsidiary of
Manufacturers;
AND WHEREAS, Manufacturers of America wishes to have Manufacturers
service its life insurance business operations, including both general account
and separate account operations;
AND WHEREAS, Manufacturers and Manufacturers of America desire that an
agreement be made between them concerning the operation of their businesses for
their mutual benefit;
NOW, THEREFORE, in consideration of the premises and the mutual
covenants hereinafter expressed, and other good and valuable consideration, the
Parties agree as follows:
Section 1. GENERAL SERVICES.
Manufacturers shall provide Manufacturers of America, as required by
Manufacturers of America, with the services of both Manufacturers' departments
and branches, including but not limited to, data processing, claims, legal, tax,
accounting, internal audit, corporate compliance, human resources, payroll,
purchasing and supply, office planning, printing and art, reinsurance,
investments, marketing and actuarial.
Section 2. PERSONNEL.
(a) Manufacturers shall determine which of its employees are
available to perform services for Manufacturers of America and
Manufacturers of America shall designate certain of these
employees as employees, officers or directors of Manufacturers
of America. Manufacturers shall pay the full salaries and
benefits of Manufacturers of America's staff.
(b) It is understood and agreed that the employees of
Manufacturers (including those who are also employees,
officers or directors of Manufacturers of America) in
performing services pursuant to this Agreement for
Manufacturers of America shall, with respect to all other
forms of their compensation, be acting as employees of
Manufacturers. The remuneration of such directors, officers
and employees received from Manufacturers shall constitute
payment in full for any services they perform for
Manufacturers of America and in no event shall such officers
and employees have a claim for remuneration from Manufacturers
of America. Manufacturers agrees to hold-harmless and
indemnify Manufacturers of America as a result of any claim
for remuneration by any officer or employee of Manufacturers.
Section 3. OFFICE SPACE, EQUIPMENT AND SUPPLIES.
Manufacturers shall provide Manufacturers of America with and pay for
certain office space, equipment, supplies and data processing services as may be
required by Manufacturers of America from time to time. Manufacturers also shall
directly pay certain operating expenses and miscellaneous business expenses of
Manufacturers of America as may be required by Manufacturers of America and
agreed to at
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the time by Manufacturers. Manufacturers shall also provide Manufacturers of
America with office equipment which both Parties determine to be necessary for
the operation of Manufacturers of America.
Section 4. ADMINISTRATIVE SERVICES.
(a) Subject to the provisions of Section 10 herein, Manufacturers
agrees to act, in the name of Manufacturers of America, as
Administrative Manager for Manufacturers of America with
respect to the business of life insurance and its related
products (both general account and separate account) carried
on by Manufacturers of America and to perform all
administrative, marketing and technical functions in
connection with the development, management, marketing and
processing of the business related thereto including, by not
limited to, billing and collection of premiums, processing of
claims, answering policyowner correspondence, maintenance of
necessary data processing and other records, payment of
producer's commissions (including the responsibility for an
expense of computation of any contingent commissions),
underwriting, appointment and cancellation of agencies and
cancellation of policies. Manufacturers shall manage the
investment of all general account assets of Manufacturers of
America.
(b) Manufacturers and Manufacturers of America shall not sell the
same policy simultaneously in the same jurisdiction.
Furthermore, Manufacturers shall not knowingly be in a
position of having conflicting interests with Manufacturers of
America due to activities which actually amount to business
competition with Manufacturers of America.
(c) Premiums collected by Manufacturers on behalf of Manufacturers
of America shall be held by Manufacturers in fiduciary
capacity with respect to Manufacturers of America and shall be
paid over to Manufacturers of America immediately following
collection.
Section 5. RECORDS.
(a) Manufacturers of America shall own and control all files,
documents, correspondence, papers and other records of every
kind and description maintained and prepared by Manufacturers
in connection with the services provided by Manufacturers
hereunder and Manufacturers shall prepare and maintain such
basic policy records and other business records as are usual
and customarily prepared and necessary for Manufacturers of
America to perform in its proper function as an insurer and to
meet all regulatory requirements. Manufacturers shall not
disclose or use any records prepared by reason of this
Agreement in any manner except as expressly authorized herein
or directed by Manufacturers of America and shall keep
confidential any information obtained by reason of this
Agreement. Upon termination of this Agreement and if requested
by Manufacturers of America, Manufacturers shall promptly
return to Manufacturers of America or its designee all such
records.
(b) Manufacturers shall furnish the Commissioner of Insurance of
Pennsylvania (the "Commissioner") with any information or
reports in connection with any of the services provided
hereunder which the Commissioner may request.
(c) Manufacturers of America shall have access to the books and
records of Manufacturers and shall have the right to examine
and audit the books and records pertaining to the business
operations serviced under this agreement.
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Section 6. COMPLIANCE WITH LAW.
In the performance of such services as described in Section 1, 4 and
5(a) herein, Manufacturers shall comply with applicable laws, rules and
regulations of the Pennsylvania Insurance Department and the insurance
regulatory authorities of other jurisdictions in which the policies serviced
under this Agreement are issued. Manufacturers shall submit to all regulatory
and administrative bodies having jurisdiction over the services provided
pursuant to this Agreement, present of future, any information, reports or other
material which any such body by reason of this Agreement may request or require
pursuant to applicable laws and regulations.
Section 7. PERFORMANCE OF SERVICES.
The services to be performed by Manufacturers hereunder will be
performed at the Home Office of Manufacturers in Xxxxxxx, Xxxxxxx, Xxxxxx as
well as the United States Branch Offices of Manufacturers. In the event
Manufacturers of America wishes to directly perform the functions handled by
Manufacturers under this Agreement, Manufacturers of America shall be entitled
to terminate this Agreement at any time.
Section 8. COMPENSATION.
(a) Manufacturers of America shall reimburse Manufacturers for the
reasonable cost of the services provided by Manufacturers'
internal departments and branches under Sections 1, 4, and
5(a) hereof. Manufacturers of America shall also fully
reimburse Manufacturers for the expenses it reasonable incurs
or payments it reasonably makes on behalf of Manufacturers of
America under any provisions of this Agreement.
(b) Manufacturers shall submit statements from time to time, but
no less often than annually, to Manufacturers of America for
all amounts payable under the terms of this Agreement, and
payment shall be made by Manufacturers of America as soon
thereafter as is reasonably possible.
Section 9. CLAIM SETTLEMENT.
Pursuant to claim settlement policies utilized by Manufacturers of
America and subject to Manufacturers of America's right to review at any time
the procedures followed by Manufacturers in implementing said settlement
policies, Manufacturers shall be authorized to pay, compromise or settle any
claim or other cause of action arising from the insurance operations serviced
hereby.
Section 10. RESERVATION OF AUTHORITY.
(a) Manufacturers is not authorized by this Agreement to (i)
extend credit for Manufacturers of America nor (ii) alter,
waive or modify any of the terms, conditions, or limitations
of any policy serviced hereunder.
(b) The officers and Board of Directors of Manufacturers of
America retain the right to supervise and control all
functions performed by Manufacturers on behalf of
Manufacturers of America.
(c) Manufacturers of America shall retain custody of
responsibility for and control of all investments while
Manufacturers manages the investment of all general account
assets of Manufacturers of America.
(d) Manufacturers of America has the ultimate right to control all
matters relating to policy development, underwriting,
marketing, cancellation of policies, cancellation of agency
appointments and the determination of agents commissions.
(e) Any duties not delegated to Manufacturers hereunder are
retained by Manufacturers of America.
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Section 11. LIABILITY.
Manufacturers shall be liable for its own misconduct, negligence and
gross negligence in providing the services set forth in this Agreement.
Section 12. ASSIGNMENT.
The rights, obligations, and interests of the Parties under this
Agreement shall not be assignable in whole or in part.
Section 13. SEVERABILITY.
Should any portion of this Agreement for any reason be held to be void
in law or in equity, the Agreement shall be construed, so far as is possible, as
if such portion had never been contained herein.
Section 14. ENTIRE AGREEMENT.
This Agreement contains the entire understanding of the Parties and may
not be amended except by an agreement in writing of subsequent date signed by
the Parties.
Section 15. HEADINGS.
The headings in the sections of this Agreement are inserted for
convenience of reference only and shall not constitute a part thereof.
Section 16. TERMINATION.
Either Party may terminate this Agreement without penalty, by 60 days'
notice in writing, delivered personally or addressed to the other at its Home
Office. In any event, however, this Agreement shall terminate no later than five
years after its effective date.
Section 17. GOVERNING LAW.
This Agreement shall be governed by and construed according to the laws
of the Commonwealth of Pennsylvania.
IN WITNESS WHEREOF, The Manufacturers Life Insurance Company and The
Manufacturers Life Insurance Company of America have caused this Agreement to be
executed and their Corporate Seals affixed hereto effective the date first
mentioned above.
THE MANUFACTURERS LIFE INSURANCE COMPANY
By:_____________________________________
Its:
THE MANUFACTURERS LIFE INSURANCE
COMPANY OF AMERICA
By:_____________________________________
Its:
