SERVICE AGREEMENT
THIS AGREEMENT, effective as of the first day of January, 1999, by and
between Phoenix Home Life Mutual Insurance Company ("Phoenix"), a New York
mutual life insurance company with executive offices at One American Row,
Hartford, Connecticut and PXRE Corporation, a Delaware corporation (together
with its subsidiaries, collectively "PXRE").
RECITALS:
Phoenix currently performs certain accounting services (as described in
Article III, collectively the "Services") with respect to PXRE for the current
investment advisor (the "Advisor") for PXRE Reinsurance Company and
Transnational Reinsurance Company, both being subsidiaries of PXRE
(collectively, the "Subsidiaries"). By agreement among Phoenix, PXRE and such
advisor, Phoenix will henceforth provide the Services directly to PXRE.
ARTICLE I: TERM
This Agreement shall remain in full force and effect through the close of
business on December 31, 2000, and shall automatically be renewed each year
thereafter for a one-year term unless either party shall have given the other at
least ninety (90) days' notice of its intent to terminate this Agreement at the
end of the then current term.
ARTICLE II: CONSIDERATION
A. General. The consideration payable to Phoenix by PXRE shall be as set
forth in Schedule II. PXRE shall also pay Phoenix any applicable state
sales, use, service or similar taxes with respect to the Services.
B. Amendments. On or before December 31 of each year, the parties shall affix
a new Schedule II hereto to reflect all changes, if any, they have agreed
upon or a confirmation that there will be no changes in the prior year's
fees.
ARTICLE III: SERVICES
A. Obligations of Phoenix.
1. General. Phoenix hereby agrees to provide the Services for the
Subsidiaries. The Services shall consist of the functions described
hereinafter.
2. Maintenance of Books and Records. Based on the data received from
PXRE, its custodian (the "Custodian") and its Advisor, Phoenix shall
develop and maintain appropriate accounting books and records
reflecting that portion of PXRE's long and short-term bond and
equity investment portfolio managed by the Advisor and all trades
effected therein by the Advisor. In so doing, it shall reconcile
data received from the Custodian with data received from the Advisor
and PXRE, researching any differences with the assistance of the
Advisor.
3. Reporting. Phoenix shall produce and provide PXRE with the reports
and system files identified in Schedule III, at the frequency
provided therein, but only insofar as such reports are based on that
portion of PXRE's portfolio as is managed by the Advisor or on
trades effected by the Advisor.
B. Obligations of PXRE.
1. General. PXRE shall provide Phoenix, in a timely fashion, with all
information, if any, in its possession or under its control which is
reasonably required by Phoenix in order to perform its obligations
hereunder. Such information shall be provided in a medium and format
reasonably acceptable to Phoenix. When Phoenix reports any
reconciliation problems to PXRE, PXRE shall promptly assist Phoenix
in researching the cause of the discrepancy.
2. Payments.
(a) Within fifteen (15) days of each calendar quarter end, Phoenix shall
invoice PXRE for all sums incurred hereunder during the preceding
quarter. Such invoice shall contain or be supplemented by a
reasonable amount of supporting detail. PXRE shall remit all sums
billed within fifteen (15) days of receipt of invoice, unless
contesting them in good faith.
(b) Within thirty (30) days after December 31 of each year and after the
date of termination of this Agreement, Phoenix shall invoice PXRE
for any additional sums owed, or remit to PXRE any excess sums paid
during the preceding Term. PXRE shall pay any additional sums
invoiced within fifteen (15) days of receipt of invoice unless
contesting them in good faith.
(c) No sums due hereunder shall be netted against sums owed by either
party to the other under any other agreement, unless the parties
shall otherwise agree.
C. Interest. All sums owed hereunder which are more than thirty (30) days
past due shall bear interest at a rate equal to the prime rate at Chase
Manhattan Bank, N.A., as of the original due date, from the original due
date until paid.
ARTICLE IV: STANDARD OF CARE
In carrying out their respective obligations hereunder, each of the parties
hereto shall use its best efforts to abide in all material respects with all
applicable laws. In addition, they shall take all reasonable efforts to preserve
each other's confidential and proprietary information.
ARTICLE V: TERMINATION
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Anything else in this Agreement notwithstanding, upon termination of PXRE's
Investment Management Agreement with the Advisor without substitution therefor
of a new advisory agreement with the Advisor or with any of its affiliates,
Phoenix' obligations under this Agreement shall automatically terminate except
as to any reports identified on Schedule III which are required for periods
ending on or before the date of such termination.
ARTICLE VI: MISCELLANEOUS
A. Governing Law. It is agreed that for all purposes, this Agreement will be
deemed to have been executed in the State of Connecticut and governed in
all instances by the laws of the State of Connecticut except those laws
governing choice of law or conflicts of law.
B. Notice. Any communications, transmittals, notices, audits and accounting
shall be in writing and shall be effective when received by:
1. PXRE in care of its Chief Executive Officer; and
2. Phoenix in care of its General Counsel.
C. Entire Agreement. This writing, together with the Schedules hereto,
constitute the entire agreement of the parties with respect to the subject
matter hereof, supersedes all prior agreements and understandings relating
to the subject matter hereof and may not be modified, amended or terminated
except by a written agreement specifically referring to this Agreement and
signed by all parties hereto. No party hereto has made any representation,
warranty or covenant in connection with the matters set forth herein except
as expressly stated herein, including the Schedules hereto.
D. Schedules. The Schedules referred to herein and delivered pursuant hereto
shall be deemed part of this Agreement as fully and effectively as if set
forth at length herein. The terms used in such schedules shall have the
same meanings as such terms have in this Agreement unless a contrary
intention is clearly manifested therein.
E. Binding Effect. This Agreement shall be binding upon and inure, to the
benefit of each party hereto and their respective successors and assigns.
Except as hereafter provided, this Agreement shall not be assigned by any
party hereto without the prior written consent of the other party, which
consent shall not be unreasonably withheld, and absent such consent, any
attempted assignment shall be void.
F. Captions. The article and section headings contained herein are for the
purpose of convenience only and are not intended to define or limit the
contents of said articles or sections.
G. Cooperation. Each party hereto shall cooperate, shall taken such further
action and shall execute and deliver such further documents as may be
reasonably requested by any other party in order to carry out the
provisions and purposes of this Agreement.
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H. Several Counterparts. This agreement may be executed simultaneously in
several counterparts, each of which shall be deemed an original, but all
of which together shall constitute one and the same instrument.
I. Severability. Any provision of this Agreement which is invalid or
unenforceable in any jurisdiction shall be ineffective to the extent of
such invalidity or unenforceability without invalidating or rendering
unenforceable the remaining provision hereof, and any such invalidity or
unenforceability in any jurisdiction shall not invalidate or render
unenforceable such provision in any other jurisdiction.
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date set forth above.
PHOENIX HOME LIFE MUTUAL PXRE CORPORATION
INSURANCE COMPANY
By: By:
/s/ Xxxxxx X. Xxxxxx /s/ Xxxxx X. Xxxx
---------------------- ----------------------
Its: Its
/s/ Vice President /s/ CFO
---------------------- ----------------------
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Schedule II
CONSIDERATION
The annual payable by PXRE for the Services shall equal 2-1/2 basis points of
the average monthly assets that PXRE and its Subsidiaries have under management
with Phoenix Investment Counsel, Inc., determined on the basis of the average of
the beginning and ending monthly assets under management.
Schedule III
REPORTS
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Type of Report Frequency
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Inventory Report Monthly
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YTD and MTD Acquisitions/Disposals Report Monthly
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Unsettled Acquisitions/Disposals Report Monthly
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Accrued Interest/Dividends Report Monthly
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YTD and MTD Interest Received Variance Report Monthly
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Monthly/Quarterly/Yearly Statutory Schedule D Monthly
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FASB Calculation Report Quarterly
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Type of File Frequency
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GNMA Income Monthly
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Statutory Schedules (A.M. Best Files) Quarterly
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Trades: Acquisitions/Disposals Quarterly
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