EXHIBIT 10.12
MASTER SERVICES AGREEMENT
This Master Services Agreement is made this 4th day of August, 2006 (the
"Effective Date") between:
XL Capital Assurance (UK) Limited, in respect of its Spanish Branch (the
"Company"); and
XL Services UK Limited, in respect of its Spanish Branch ("XL Services")
(each a Party and collectively the "Parties").
WHEREAS:
XL Services and the Company are currently wholly owned subsidiaries of the XL
Capital Ltd group of companies ("XL Group"); and
XL Services provides certain services to XL Group companies including the
Company; and
It is contemplated that an initial public offering will be made of a portion of
the capital stock of Security Capital Assurance Ltd, a parent of the
Company, resulting in partial public ownership of Security Capital
Assurance Ltd; and
XL Services and the Company both desire for XL Services to continue to provide
certain services to the Company following the initial public offering of
Security Capital Assurance Ltd; and
XL Services and the Company desire to enter into this Agreement to set forth the
roles and responsibilities with regard to services to be provided by XL
Services to the Company.
Now, in consideration for the mutual benefits contained in this Master Services
Agreement, it is agreed as follows:
1 DEFINITIONS
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The following words and phrases shall have the meaning given to them below:
"Actual Cost" shall have the meaning specified in clause 17.2.
"Agreement" means this Master Services Agreement, the Schedules and Appendices
attached to it and any subsequent amendments or alterations agreed in
writing by the Parties.
"AOP" shall have the meaning specified in clause 12.1.
"AOP" Objectives" shall have the meaning specified in clause 12.1.
"Business Service Functions" means, the functions detailed in the C Schedules as
amended from time to time.
"Core Functions" means the functions detailed in the B Schedules as amended from
time to time.
"Employee Costs" shall have the meaning specified in the Schedules attached
hereto.
"Executive Functions" means the functions detailed in the A Schedules as amended
from time to time
"Expiration Date" shall the meaning specified in clause 2.1.
"Fees" shall have the meaning specified in clause 17.1.
"Non-XL Third Party Contractors" means any individual, company or other legal
entity with whom XL Services enters into a contract for the benefit of the
Company, including (but not limited to) to enhance its ability to provide
any part of the Services, where such individual, company or other legal
entity is not within the XL Capital Ltd group of companies.
"Representatives" shall have the meaning specified in clause 11.1.
"Services" means collectively (i) providing Staff or Non-XL Third Party
Contractors to fulfil the Executive Functions and Core Functions in
accordance with the A and B Schedules as amended from time to time; (ii)
providing the Business Service Functions in accordance with the C
Schedules as amended from time to time; and (iii) contracting or
subcontracting with Third Party Contractors to fulfil specific functions,
including, but not limited to, the Executive Functions, Core Functions and
Business Service Functions - in each case for the benefit of the Company.
"Service" means any one of the above, as appropriate.
"Staff" means individuals employed by XL Services or with another company within
the XL Group of companies.
"Steering Committee" shall have the meaning specified in clause 11.3.
"Support Services" means Security Capital Assurance Ltd's and/or the Company's
proportional share of the services provided to and in support of XL
Services by any employees of the XL Group, determined on a per capita
basis.
"Third Party Contractors" means both XL Third Party Contractors and Non-XL Third
Party Contractors.
"XL Third Party Contractors" means any individual, company or other legal entity
with whom XL Services enters into a contract for the benefit of the
Company, including (but not limited to) to enhance its ability to provide
any part of the Services, where such individual, company or other legal
entity is within the XL Capital Ltd group of companies.
2 PERIOD OF THIS AGREEMENT
------------------------
2.1 This Agreement shall commence on the Effective Date and shall terminate on
the second anniversary of the Effective Date (the "Expiration Date")
unless earlier terminated in accordance with clause 12.1 or clause 20 of
this Agreement.
3 PROVISION OF SERVICES
---------------------
3.1 Each Schedule attached to and made a part of this Agreement describe the
Services to be provided by XL Services to the Company, as amended from
time to time by written agreement of the Parties. The Parties have made a
good faith effort as of the date hereof to identify the Services and to
complete the content of the Schedules accurately. It is anticipated that
the Parties will modify the Services from time to time. In that case or to
the extent that any Schedule is incomplete, the Parties will use good
faith efforts to modify the Schedules. There are certain terms that are
specifically addressed in the Schedules attached hereto that may differ
from the terms provided hereunder. In those cases, the specific terms
described in the Schedules shall govern.
3.2 The Parties may also identify additional services that they wish to
incorporate into this Agreement. The Parties will create additional
Schedules setting forth the description of such services, the Fees for
such services and any other applicable terms.
3.3 Subject to the terms of this Agreement, XL Services undertakes to and
shall provide the Services to the Company to the best of its ability at
all times and to a standard that would reasonably be expected of it by a
professional, independent person or body.
3.4 Without prejudice to clause 3.3, to the extent that XL Services is unable
to perform any part of the Services in accordance with this Agreement, it
shall advise the Company as soon as reasonably practicable. In addition,
XL Services shall, to the extent possible, advise the Company of a
timetable for it to be able to resume full performance of the Services in
accordance with this Agreement and the steps it is taking in that regard.
XL Services shall notify the Company to the extent there is likely to be
any deviation from the timetable proposed.
3.5 The Parties acknowledge and agree that XL Services and the Staff shall be
entitled to provide similar services as the Services to any other legal
entity, provided that in doing so the operation of the Company is not
unreasonably prejudiced and the provision of the Services to the Company
is not materially adversely affected. The Parties further acknowledge and
agree that the Company may retain any individual or legal entity, other
than XL Services and the Staff, to perform services similar or identical
to the Services, provided that in doing so the ability of XL Services to
perform any part of the Services in accordance with the Agreement is not
materially adversely affected.
4 PROVISION OF STAFF TO FULFIL THE EXECUTIVE FUNCTIONS AND CORE FUNCTIONS
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4.1 XL Services acknowledges it has been given sufficient information to
understand and appreciate the requirements and operations of the Company
relating to the Executive Functions and Core Functions currently described
in the A and B Schedules. XL Services shall use its reasonable best
endeavours to provide at all times Staff or Non-XL Third Party Contractors
of the requisite calibre, and with appropriate training and experience and
in sufficient numbers as required by the Company and as agreed between the
Parties and in accordance with the A and B Schedules.
4.2 The Company acknowledges and agrees that at the commencement of this
Agreement the Staff or Non-XL Third Party Contractors provided to perform
the Executive Functions and Core Functions are of the requisite calibre,
have appropriate experience and training and are of a sufficient number.
4.3 Clause 4.1 is subject to the Company's business plan and changing
requirements. If the Company's business plan and requirements alter
materially after the date this Agreement commences, the Parties shall
endeavour to agree the additional or reduced requirements of the Company
in relation to the Executive Functions and Core Functions and XL Services
shall use its reasonable best endeavours to fulfil such agreed
requirements of the Company in relation to the Executive Functions and
Core Functions.
4.4 The employment and local management of the Staff provided to fulfil
Executive Functions and Core Functions on behalf of the Company will be
the responsibility and under the control of XL Services. Notwithstanding
the foregoing, the Company will have the responsibility and ultimate
control over the Staff provided to fulfil Executive Functions and Core
Functions in respect of the regulated activities of the Company.
4.5 If XL Services cannot provide Staff to perform the Executive Functions and
Core Functions, it shall, with the agreement of the Company, contract or
subcontract with Non-XL Third Party Contractors to provide all or part of
the Executive Functions and Core Functions. The direction and management
of the Non-XL Third Party Contractors provided to fulfil the Executive
Functions or Core Functions on behalf of the Company will be the
responsibility of XL Services, unless otherwise agreed by the Parties in
writing, but only to the extent that XL Services has contracted directly
with such Non-XL Third Party Contractors.
5 PROVISION OF BUSINESS SERVICE FUNCTIONS
---------------------------------------
5.1 XL Services acknowledges it has been given sufficient information to
understand and appreciate the requirements and operations of the Company
relating to the Business Service Functions currently described in the C
Schedules. XL Services shall use its reasonable best endeavours to provide
at all times the Business Service Functions as required by the Company and
as agreed between the Parties and in accordance with the C Schedules.
5.2 The Company acknowledges and agrees that at the commencement of this
Agreement the Staff and Third Party Contractors performing the Business
Service Functions are of the requisite calibre, have the appropriate
experience and training and are of a sufficient number.
5.3 Clause 5.1 is subject to the Company's business plan and changing
requirements. If the Company's business plan and requirements alter
materially after the date this
Agreement commences, the Parties shall endeavour to agree the additional
or reduced requirements of the Company in relation to the Business Service
Functions. XL Services shall use its reasonable best endeavours to fulfil
the agreed requirements of the Company in relation to the Business Service
Functions.
5.4 The direction and management of the Staff and Third Party Contractors
providing the Business Service Functions will be the responsibility and
under the control of XL Services.
6 THIRD PARTY CONTRACTORS
-----------------------
6.1 The Company acknowledges and agrees that the provision of the Services may
in part be delegated or contracted or subcontracted to Third Party
Contractors by XL Services.
6.2 XL Services may enter into contracts with Third Party Contractors,
including, but not limited to, for the provision of the Services, either
on its own behalf or on its own behalf and on behalf of the Company,
whichever XL Services reasonably deems appropriate and in the best
interests of the Company.
6.3 When entering into contracts with Third Party Contractors, XL Services
will have regard to the stated interests of the Company, including, but
not limited to, the identity of the Third Party Contractor, the terms,
costs and period of the contract.
6.4 To the extent XL Services delegates to, or contracts or subcontracts with,
Third Party Contractors to perform any part of the Services or to perform
specific functions, XL Services shall (remain responsible and) be liable
to the Company for the (non) performance of the Services and the (non)
performance of such specific functions in their entirety (and for the
oversight and management of the Third Party Contractors) and in accordance
with clause 7.1. below, unless otherwise agreed in writing by the Company.
7 LIABILITY
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7.1 Except to the extent set out in clauses 7.2, to 7.5 below or as a result
of a breach by the Company of its obligations under clause 16.1, XL
Services shall be liable to indemnify the Company for any loss the Company
incurs (including defence costs) caused by (i) the acts and/or omissions
of XL Services, its employees, directors and officers in providing the
Services, (ii) the breaches of obligations, acts and/or omissions of Third
Party Contractors, and (iii) the failure of XL Services to abide by the
terms and conditions of this Agreement. Both Parties shall take all
reasonable steps to mitigate any loss including pursuing recovery from any
third party. Where appropriate, the Parties further agree they will
consult each other in respect of such steps, in accordance with clause 11
below.
7.2 XL Services shall not be liable to the Company in respect of any loss
caused by acts of God, or any event beyond the reasonable control of the
Parties, including but not limited to nationalization, expropriation,
devaluation, seizure, or similar action by any government authority, de
facto or de jure; or acts of war, terrorism, insurrection or revolution.
7.3 XL Services shall not be liable to the Company for the performance of the
Executive Functions and Core Functions by Staff. The Company will be
responsible and liable for the management and oversight of such Staff and
the way in which the Staff
perform the Executive Functions and Core Functions on behalf of the
Company. The Company shall indemnify XL Services for any loss XL Services
incurs with respect to the Staff's performance of the Executive Functions
and Core Functions. XL Services will, however, be liable to the Company
for the performance of any Third Party Contractor retained by XL Services
for the benefit of the Company, including, but not limited to, Third Party
Contractor's performance of Executive Functions and Core Functions, but
only to the extent that XL Services has contracted directly with such
Third Party Contractor.
7.4 To the extent that Staff provide or perform any service or function to, or
on behalf of, an entity not a party to this Agreement, whether an
Executive Function, Core Function or Business Service Function, it is
agreed that the Company shall not be liable for the acts and/or omissions
of the Staff in performing such services or functions.
7.5 XL Services agrees to take all reasonable steps to recover any loss
suffered by the Company (for which XL Services is liable to indemnify the
Company under this Agreement) from any insurer or any third party liable
to XL Services in respect of such loss. Provided that XL Services complies
with such obligation in a timely manner, the Company agrees to delay
commencing proceedings against XL Services to enforce payment in respect
of any claim which it may have under this Agreement until such time as and
to the extent that XL Services has obtained recovery against any third
party (including but not limited to Third Party Contractors and insurers)
in respect of such losses.
8 INSURANCE
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8.1 XL Services undertakes it or one of its affiliates has and will maintain
throughout the duration and period of this Agreement appropriate errors
and omissions and directors' and officers' insurance in full force and
effect to cover its liabilities to third parties.
9 LIMITATION OF AUTHORITY
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9.1 Except as expressly provided for in this Agreement, or by the Company,
neither XL Services nor the Staff shall enter into any contract (including
verbal) on behalf of the Company or commit or bind the Company to any
agreement or obligation, or hold it or themselves out as having authority
to do so.
10 COMPLIANCE
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10.1 In providing the Services XL Services shall, to the extent it is made
aware of and it is within its control, comply with, and will not do
anything or fail to do anything, which would result in the Company failing
to comply with, all applicable laws, legislation and regulations. In
addition, XL Services shall comply with relevant principles and
guidelines, manuals, codes and policies issued by the Company to the
extent it is made aware of such principles and guidelines, manuals, codes
and policies. It is agreed and understood that this clause does not affect
or reduce the Company's duty and responsibility with regard to its own
regulatory and legal compliance.
10.2 XL Services shall direct all enquiries from any regulatory authority
relating to this Agreement or the Services to the Company, unless (i) the
enquiry is specifically addressed to XL Services (in which case XL
Services shall procure that the details or a copy of such enquiry are
promptly relayed in writing to the Company), (ii) the enquiry
relates exclusively to a third party and not to the Company, or (iii)
otherwise agreed in writing by the Parties.
11 PERSONS RESPONSIBLE FOR THE OPERATION OF THIS AGREEMENT
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11.1 XL Services and the Company shall each appoint two individuals to be their
respective representatives (the "Representatives") for the purpose of the
operation of this Agreement. The Representatives (identified below) shall
be responsible for, among other things, managing the relationship, and
acting as the principal points of contact, between the Parties in relation
to matters and disputes under this Agreement.
11.2 Any matters or disputes under this Agreement including matters or disputes
affecting the relationship between the Parties or the performance of their
respective obligations hereunder, shall, in the first instance, be raised
to and sought to be resolved by the Representatives.
11.3 If and to the extent that any matters or disputes cannot be resolved by
the Representatives then the Representatives shall raise such matters or
disputes with a committee comprised of the members set forth on Annex A
hereto and established by the Parties for the purpose of overseeing the
relationship between the Parties with respect to matters set forth in this
Agreement (the "Steering Committee"). The Steering Committee shall be
responsible for the resolution of those matters and disputes brought
before it.
11.4 The Parties may each appoint Representatives, in lieu of their
Representatives listed below, provided that prior written notice is given
to the other Party in accordance with clause 24 below.
THE COMPANY'S REPRESENTATIVES: See Annex A hereto.
XL SERVICES' REPRESENTATIVES: See Annex A hereto.
12 ANNUAL OPERATING PLAN AND PERFORMANCE REVIEW
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12.1 The Parties will coordinate the development of an annual operating plan
("AOP") setting forth the specific objectives, Service standards,
performance measures, activity levels and a detailed budget setting out
the cost estimates, types of services and allocation keys for the Services
(collectively, the "AOP Objectives"). The Parties shall implement the AOP
Objectives by January 1 of each calendar year. In the AOP
process, the Parties agree to use their best efforts to harmonize the
interests of the Company to have quality services at affordable cost and
the interests of XL Services to recover its costs of performing the
Services. Other than with respect to the legal services to be provided
hereunder, on or before August 15 of each calendar year, the Company shall
submit to XL Services a list of the types of services required from XL
Services, upon which XL Services shall establish its budget and cost
estimate calculations for purposes of the AOP. On or before September 15
of each calendar year, an AOP for each Service for the next calendar year
will be submitted to each of the Representatives of the Company and of XL
Services for review and approval. Approval by each Party's respective
Representative will constitute approval by the Parties of the AOP. In the
event that the Parties do not approve the AOP in whole or in part in
respect of any Services, XL Services shall have the right to terminate
this Agreement (or any extension hereof entered into pursuant to clause
20.2 below) in respect of any such Services upon ninety (90) days written
notice to the Company.
12.2 The Parties will meet annually on or about July 31 to review progress
against the AOP Objectives, Service standards, performance measures and
activity levels. The Parties will use their good faith efforts to resolve
any issues concerning Service standards, performance measures or changes
in Fees from the AOP during these meetings. If the Parties are unable to
resolve those issues, they will refer the disputed issues, in the first
instance to their respective Representatives and in the second instance to
the Steering Committee, pursuant to clause 11 above.
13 DOCUMENTS AND RECORDS
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13.1 XL Services shall establish and/or maintain records relating to this
Agreement and, to the extent reasonable and appropriate, the Services, in
accordance with the document retention policy established by XL Capital
Ltd or in accordance with applicable laws and regulations if they provide
for longer periods of retention.
13.2 Company, its bona fide agents, auditors and/or a relevant regulatory
authority shall have the right on the giving of reasonable prior notice to
inspect and audit any records of or held by XL Services relating to this
Agreement and the Services and shall have the right to make copies or
extracts of any such records.
13.3 In the event that an audit reveals that XL Services is not complying with
the terms of this Agreement, or any applicable regulation, principles,
guidelines, laws or legislation in any material respect, the Company may,
without prejudice to its other rights under this Agreement, require XL
Services to take all necessary remedial action within four (4) weeks
following disclosure to XL Services of such audit results.
13.4 All files, materials, policies and documents prepared or obtained by XL
Services in the course of carrying out its obligations under this
Agreement shall be and remain the property of the Company, and XL Services
shall treat them accordingly - including keeping them safe and secure
whilst in XL Services' possession.
14 CONFIDENTIALITY
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14.1 Confidential Information means all information disclosed by either the
Company or XL Services (whether in writing, orally or by another means)
concerning the other Party which comes into their possession as a
consequence of the operation of this Agreement including, without
limitation, information relating to the Parties' products,
operations, processes, plans or intentions, product information, know-how,
design rights, trade secrets, market opportunities and business affairs.
14.2 The Parties undertake to hold the Confidential Information in confidence
and not to disclose the Confidential Information (except as provided in
this Agreement) without the prior written consent of the other Party.
14.3 Notwithstanding clause 14.2, and provided prior written notice is provided
to the other Party, the Parties are entitled to disclose that portion of
the Confidential Information required in order to comply with any legal
requirement or any regulation or rule, or the requirements of any rating
agency, or to the extent the Confidential Information is already in the
public domain.
15 DATA PROTECTION
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15.1 The Parties undertake to comply with all applicable data protection laws
and regulations in any relevant jurisdiction in which personal data (or
any other data, the use or transfer of which is regulated by law and
regulations in that jurisdiction) is transferred or used in connection
with the provision of the Services.
16 BUSINESS CONTINUITY PLAN
------------------------
16.1 The Parties shall be jointly responsible for devising a plan(s) to ensure
the continuity of the Services in the event of an "unforeseen
interruption" (in accordance with the FSA Handbook) and any other prudent
procedures and measures which are reasonably necessary to prevent the
disruption of the Services (collectively, the "Business Continuity Plan").
The Company shall be responsible for maintaining the Business Continuity
Plan and XL Services shall, in the event of an unforeseen interruption,
cooperate to the best of its ability with the Company to ensure the
uninterrupted provision of Services.
17 REMUNERATION AND FEES
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17.1 GENERAL: Within thirty (30) days of the receipt of an invoice from XL
Services, the Company shall pay XL Services monthly, in arrears on a "cost
" basis for the Executive Functions and Core Functions and on a "cost
plus" basis for each Business Service Function as set forth in the
attached Schedules (collectively, the "Fees"). Each such invoice shall
itemize the Fees, the Employee Costs (as defined in the attached
Schedules), and the methodology for calculating the Employee Costs. The
Parties agree that the annual percentage xxxx up, as set forth in the
attached Schedules, will be determined with the assistance of an unrelated
third party utilizing UK tax related transfer pricing guidelines. Except
as specifically provided herein or in the Schedules, or as subsequently
agreed in an AOP or otherwise by the Company, the Company will not be
responsible to XL Services or to any Non-XL Third Party Contractor, for
any additional fees, charges, costs or expenses relating to the Services,
unless such additional fees, charges, costs or expenses are a direct
result of the Company's unilateral deviation from the scope of the
Services defined in the Schedules.
17.2 REVIEW OF FEES:
(a) Subject to the provisions of clause 12.1, at the end of each annual
period commencing as of January 1, 2006, XL Services will review the
charges, costs and expenses actually incurred by XL Services in
providing any Service, as well as the calculation of any related
Fees (collectively, "Actual Cost") during
the previous twelve (12) months. In the event that XL Services
determines that the Actual Cost for any Service differs from that
set forth in the AOP, XL Services will deliver to the Company
documentation for such Actual Cost, and will adjust the appropriate
Fees retroactively and/or prospectively as necessary to reflect such
differences; provided, however, that no such adjustment shall
increase or decrease the Fees payable in respect of any Service by
more than 15% of the initial related Fees currently set forth in the
related Schedules for such Service.
(b) As a part of the AOP process referred to in clause 12, the Parties
will set Fees or new budgets for each ensuing year, and may make
other changes to the Fees with respect to each Service, based upon
an increase or reduction in the scope of requirements for such
Service. Once an AOP has been finalized (whether by agreement or
pursuant to the provisions of clause 12.2), the Fee for each Service
set out in that AOP will apply for the ensuing year, subject to any
subsequent written agreements between the Parties.
18 TAXES
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18.1 All sums payable pursuant to this Agreement shall be exclusive of any VAT
and other duties and taxes. Any VAT or other duties or taxes payable on
such sums shall be payable in addition to such sums.
19 COMPLAINTS
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19.1 In accordance with clause 24 below, the Parties shall notify one another
immediately upon becoming aware of any relevant matter arising out of the
operation of, or in connection with, this Agreement which has resulted or
could result in a complaint to, including but not limited to, any
regulatory authority or which could give rise to litigation or proceedings
against either Party.
20 TERMINATION
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20.1 At any time prior to the Expiration Date, upon ninety (90) days written
notice to XL Services, this Agreement may be terminated by the Company
either in whole or with respect to one or more of the Services.
20.2 At any time after the Expiration Date this Agreement may be extended
and/or terminated by the Parties in writing, either in whole or with
respect to one or more of the Services; provided, however, that such
extension and/or termination shall only apply to the Services for which
the Agreement was extended and/or terminated. At least ninety (90) days
prior to the Expiration Date, the Company shall give XL Services written
notice of the Company's request to extend the term of or terminate the
Agreement in respect of any Services. In addition, the Parties shall be
deemed to have (i) extended this Agreement with respect to a specific
Service if the Schedule for such Service specifies a completion or
termination date beyond the aforementioned Expiration Date and (ii)
terminated this Agreement with respect to a specific Service if the
Schedule for such Service specifies a completion or termination date prior
to the aforementioned Expiration Date. Services shall be provided up to
and including the date set forth in the applicable Schedule, subject to
earlier termination as provided herein.
20.3 Other than in respect of Internal Audit Services provided in connection
herewith, which will continue and/or terminate in accordance with the
other relevant provisions
of this Agreement, this Agreement shall terminate in the event XL Capital
Ltd group's ownership of common stock of Security Capital Assurance Ltd
falls to 35% or less in which case the Parties shall have ninety (90)
days, from the date of such event, to terminate all Services unless
otherwise agreed by the Parties; provided, however, that if the reduction
in the XL Group's ownership interests referred to above is initiated by
the XL Group, XL Services shall use its reasonable best efforts to
maintain the General Ledger and Human Resources Services provided
hereunder, subject to applicable law, until the Expiration Date, and any
additional costs incurred by either XL Services or the Company in
connection with the maintenance of such Services shall be paid by XL
Services.
20.4 Unless the other Party specifically agrees to the contrary in writing,
this Agreement will be automatically terminated with immediate effect in
the event that one Party shall:-
(a) enter voluntary or involuntary rehabilitation or liquidation;
(b) become the subject of an action in bankruptcy;
(c) make or propose any composition with its creditors or make any
assignment for the benefit of its creditors or otherwise acknowledge
its insolvency;
(d) have an administrator or administrative receiver or equivalent
office holder appointed by a court of competent jurisdiction;
(e) have a receiver or equivalent office holder appointed for the whole
or any part of its business;
(f) any past or present director, officer, partner or employee of XL
Services is convicted of or charged with any criminal offence
involving fraud or dishonesty or any similar criminal offence which
may materially affect the operation of this Agreement.
20.5 Each Party shall inform the other immediately upon becoming aware of the
occurrence of any of the events set out in clause 20.4 above.
20.6 In the event of persistent and material breaches of any discreet part of
the Services, the Company shall inform the Representatives of XL Services
in writing of the nature of such breaches. The Representatives shall meet
as soon as reasonably practicable to discuss these breaches (such meeting
being expected to occur within seven (7) business days of receipt of the
written notice) and try to agree an action plan designed to remedy the
breaches within a reasonable timeframe acceptable to the Company. Should
an action plan not be agreed within a reasonable timeframe, or the
implementation of an action plan not result in the Services being
performed to the specified standards, then the Representatives shall raise
the matter with the Steering Committee, in accordance with clause 11
above. If the material breaches continue and the Steering Committee does
not provide a resolution to the matter within a reasonable timeframe, then
the Company has the right to terminate the relevant part of the Services
with one (1) month's notice. Such termination will not affect the
continuance of the Services not subject to the persistent and material
breaches.
20.7 On termination of any Service provided for in any Schedule or the entire
Agreement, each Party shall bear its own associated costs; XL Services
will cooperate in good faith with the Company to provide the Company (or
its designee) with reasonable
assistance to make an orderly transition from XL Services to another
supplier of the Services. XL Services undertakes to work with the Company
to ensure a smooth transition and hand-over and to minimise the costs
associated with termination for each Party. Such transition assistance
shall include the following:
(a) developing a transition plan with assistance from the Company or its
designee; and
(b) organizing and delivering to the Company records and documents
necessary to allow continuation of the Services, including
delivering such materials in electronic forms and versions as
requested by the Company.
20.8 Termination of this Agreement does not affect a Party's accrued rights and
obligations at the date of termination.
21 LAW AND JURISDICTION
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21.1 This Agreement shall be construed in accordance with the laws of England
and Wales and the Parties agree to refer all disputes not resolved in
accordance with clause 11 to arbitration in accordance with the UNCITRAL
Model Law.
22 THIRD PARTIES' RIGHTS
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22.1 For the avoidance of doubt, no term of this Agreement is intended for the
benefit of any third party, and the parties do not intend that any term of
this Agreement should be enforceable by a third party either under the
Contracts (Rights of Third Parties) Xxx 0000 or otherwise.
23 ASSIGNMENT
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23.1 This Agreement shall not be assignable by either Party without the express
written consent of the other, and such consent shall not be unreasonably
withheld, provided however that upon delivery of notice to the Company, XL
Services may assign all or a portion of its rights under this Agreement to
an affiliate. For the purposes of this Agreement "affiliate" shall mean
any person, corporation, company, partnership, individual or group
(collectively a "Person"), which directly or indirectly, through one or
more intermediaries, controls or is controlled by, or owns or is owned by
another Person, with an equity or other financial interest of 35% or more
of any management interest.
24 NOTICES
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24.1 All notices hereunder shall be sent to the Party at the address set forth
below or at such other address as shall be specified by a Party as to it
in a notice duly given. Notices shall be effective upon receipt, and shall
be addressed as follows:
If to XL Services: XL Services UK Limited.
XX Xxxxx
00 Xxxxxxxxxxx Xxxxxx
Xxxxxx XX0X 0XX
Attention:
Telephone:
Facsimile:
If to the Company: XL Capital Assurance (UK) Ltd
XX Xxxxx
00 Xxxxxxxxxxx Xxxxxx
Xxxxxx XX0X 0XX
Attention:
Telephone:
Facsimile:
or to such other address as a Party shall have designated by notice in
writing to the other Party in the manner provided by this clause 24.1.
25. ENTIRE AGREEMENT
----------------
25.1 This Agreement, including the attached Schedules and Appendices, is the
complete and exclusive statement of the agreement between the Parties and
supersedes all prior proposals, understandings and all other agreements,
oral and written, between the Parties relating to the subject matter of
this Agreement. This Agreement may not be modified or altered except by
written instrument duly executed by both Parties.
26. FORCE MAJEURE
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26.1 Any delay or failure by either Party in the performance of this Agreement
will be excused to the extent that the delay or failure is due solely to
causes or contingencies beyond the reasonable control of such Party.
27. SEVERABILITY
------------
27.1 If any provision, clause or part of this Agreement, or the application
thereof under certain circumstances is held invalid or unenforceable for
any reason, the remainder of this Agreement, or the application of such
provision, clause or part under other circumstances shall not be affected
thereby.
IN WITNESS WHEREOF, the Parties have signed this Agreement on the
Effective Date above.
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XL SERVICES UK LIMITED XL CAPITAL ASSURANCE (UK) LIMITED
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By /s/ Rhicert Xxxx By: /s/ Xxxx Xxxx
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Name: Rhicert Xxxx Name: Xxxx Xxxx
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Title: Director Title: Chief Operating Officer
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A SCHEDULES
DESCRIPTION OF SERVICES - EXECUTIVE FUNCTIONS
SCOPE
XL Services UK Ltd ("XL Services") will provide ______________________________
services to Security Capital Assurance Ltd ("SCA"), either through XL Services'
own resources, the resources of its subsidiaries or affiliates, as defined in
the Master Services Agreement (the "Services Agreement"), dated as of
_______________, by and between XL Services and SCA, or by contracting with
Non-XL Third Party Contractors, all in accordance with Agreement.
SPECIFIC SERVICES
The specific services that XL Services will provide are as follows:
1. _____________________________________________________________________________
2. _____________________________________________________________________________
3. _____________________________________________________________________________
4. _____________________________________________________________________________
5. _____________________________________________________________________________
Additional services may be included upon agreement of both parties.
SERVICE FEES
The Company will pay XL Services semi-annually on a "cost plus" basis for each
Service as set forth herein.
The Fee will include:
(i) with respect to the Services being performed and Support Services being
provided by XL Services, any salaries, bonuses, benefits, fringe benefits,
incentive compensation benefits (if applicable) payroll taxes or other
applicable taxes, and depreciation/amortization of office equipment and
software attributed to the employees in the group (collectively, the
"Employee Costs"), based upon the ratio of XL Services' estimate of the
time spent by the employees on behalf of SCA or in connection with
providing Support Services divided by the total time spent by the
employees multiplied by the Employee Costs;
(ii) a xxxx up of ____% of the aggregate amount calculated pursuant to (i);
(iii) third-party expenses, including travel and entertainment, consulting fees
and printing costs, incurred on behalf of SCA by XL Services on behalf of
SCA or in connection with providing Support Services; and
(iv) any costs incurred by the XL Services in providing the Services not in the
ordinary course of business.
ADDITIONAL TERMS
Period of coverage will be ongoing subject to yearly reviews during the annual
budgeting process.
B SCHEDULES
DESCRIPTION OF SERVICES - CORE FUNCTIONS
SCOPE
XL Services UK Ltd ("XL Services") will provide ______________________________
services to Security Capital Assurance Ltd ("SCA"), either through XL Services'
own resources, the resources of its subsidiaries or affiliates, as defined in
the Master Services Agreement (the "Services Agreement"), dated as of
_______________, by and between XL Services and SCA, or by contracting with
Non-XL Third Party Contractors, all in accordance with Agreement.
SPECIFIC SERVICES
The specific services that XL Services will provide are as follows:
1. _____________________________________________________________________________
2. _____________________________________________________________________________
3. _____________________________________________________________________________
4. _____________________________________________________________________________
5. _____________________________________________________________________________
Additional services may be included upon agreement of both parties.
SERVICE FEES
The Company will pay XL Services semi-annually on a "cost plus" basis for each
Service as set forth herein.
The Fee will include:
(i) with respect to the Services being performed and Support Services being
provided by XL Services, any salaries, bonuses, benefits, fringe benefits,
incentive compensation benefits (if applicable) payroll taxes or other
applicable taxes, and depreciation/amortization of office equipment and
software attributed to the employees in the group (collectively, the
"Employee Costs"), based upon the ratio of XL Services' estimate of the
time spent by the employees on behalf of SCA or in connection with
providing Support Services divided by the total time spent by the
employees multiplied by the Employee Costs;
(ii) a xxxx up of ____% of the aggregate amount calculated pursuant to (i);
(iii) third-party expenses, including travel and entertainment, consulting fees
and printing costs, incurred on behalf of SCA by XL Services on behalf of
SCA or in connection with providing Support Services; and
(iv) any costs incurred by the XL Services in providing the Services not in the
ordinary course of business.
ADDITIONAL TERMS
Period of coverage will be ongoing subject to yearly reviews during the annual
budgeting process.
C SCHEDULES
DESCRIPTION OF SERVICES - BUSINESS SERVICE FUNCTIONS
SCOPE
XL Services UK Ltd ("XL Services") will provide ______________________________
services to Security Capital Assurance Ltd ("SCA"), either through XL Services'
own resources, the resources of its subsidiaries or affiliates, as defined in
the Master Services Agreement (the "Services Agreement"), dated as of
_______________, by and between XL Services and SCA, or by contracting with
other Third Party Contractors, all in accordance with Agreement.
SPECIFIC SERVICES
The specific services that XL Services will provide are as follows:
1. _____________________________________________________________________________
2. _____________________________________________________________________________
3. _____________________________________________________________________________
4. _____________________________________________________________________________
5. _____________________________________________________________________________
Additional services may be included upon agreement of both parties.
SERVICE FEES
The Company will pay XL Services semi-annually on a "cost plus" basis for each
Service as set forth herein.
The Fee will include:
(i) with respect to the Services being performed and Support Services being
provided by XL Services, any salaries, bonuses, benefits, fringe benefits,
incentive compensation benefits (if applicable) payroll taxes or other
applicable taxes, and depreciation/amortization of office equipment and
software attributed to the employees in the group (collectively, the
"Employee Costs"), based upon the ratio of XL Services' estimate of the
time spent by the employees on behalf of SCA or in connection with
providing Support Services divided by the total time spent by the
employees multiplied by the Employee Costs;
(ii) a xxxx up of ____% of the aggregate amount calculated pursuant to (i);
(iii) third-party expenses, including travel and entertainment, consulting fees
and printing costs, incurred on behalf of SCA by XL Services on behalf of
SCA or in connection with providing Support Services; and
(iv) any costs incurred by the XL Services in providing the Services not in the
ordinary course of business.
ADDITIONAL TERMS
Period of coverage will be ongoing subject to yearly reviews during the annual
budgeting process.
