Exhibit (i)
MASTER ADMINISTRATION AGREEMENT
FOR CORPORATE OWNED LIFE INSURANCE
between
XxXxxxxx Systems, L.L.C.
and
General American Life Insurance Company
dated as of July 12, 2001
TABLE OF CONTENTS
SECTION 1 DEFINITIONS 1
1.01 Books and Records 1
1.02 Case 2
1.03 End User 2
1.04 Effective Date 2
1.05 Initial Term 2
1.06 Policy Administration Services 2
1.07 Policies 2
1.08 Products 2
SECTION 2 TERM 2
SECTION 3 POLICY OR PLAN ADMINISTRATION 3
3.01 Administrative Services 3
3.02 Performance Criteria 3
3.03 Authorized Personnel 3
3.04 Records 3
SECTION 4 FEES AND EXPENSES 3
4.01 Administration Fees 3
4.02 Expenses 4
4.03 System Enhancements 5
4.04 Payment 5
SECTION 5 REPRESENTATIONS AND WARRANTIES OF XXXXXXXX 5
SECTION 6 REPRESENTATIONS AND WARRANTIES OF COMPANY 6
SECTION 7 ADDITIONAL COVENANTS 6
7.01 Independent Contractor 6
7.02 Confidentiality and Disclosure 7
7.03 Indemnification 9
7.04 Arbitration. 9
7.05 Compliance 10
7.06 Actions 10
7.07 Records 11
7.08 Audit 11
7.09 Security of Operations 12
7.10 Insurance Coverage 12
SECTION 8 TERMINATION OF AGREEMENT 12
8.01 By Mutual Agreement 12
8.02 By Non-Renewal 12
8.03 For Cause 12
SECTION 9 ASSIGNMENT 13
9.01 Assignment by Company 13
9.02 Assignment by XxXxxxxx 13
SECTION 10 MISCELLANEOUS 13
10.01 Governing Law 13
10.02 Notices 13
10.03 Entire Agreement 14
10.04 Binding Effect 14
10.05 Severability 14
10.06 No Third Party Beneficiaries 14
10.07. Headings 14
10.08 Counterparts 15
10.09 Waiver 15
10.10 Construction 15
10.11 Taxes 15
10.12 Software Escrow Agreement 15
10.13 Software License in Escrow 16
10.14 Force Majeure 16
SECTION 11 YEAR 2000 COMPLIANCE 16
TABLE OF EXHIBITS
A Policy Administration Services
B Intentionally Omitted
C Performance Criteria
D Fee Schedule
E Products
F Schedule of Authorized Personnel
G Insurance Coverage
H Sample Software Escrow Agreement
I Sample Software License Agreement
MASTER ADMINISTRATION AGREEMENT
This MASTER ADMINISTRATION AGREEMENT (this "Agreement") is made and
entered into as of the 12" day of July, 2001, by and between XxXxxxxx Systems,
L.L.C., a Georgia limited liability company, having its principal address and
place of business at 0000 Xxxxxx Xxxxx Xxxx, Xxxxx Xxxxx, Xxxxxxx, Xxxxxxx,
00000 (hereinafter referred to as "XxXxxxxx"); and General American Life
Insurance Company, a stock life insurance company registered under the laws of
the State of Missouri, having its principal place of business at 000 Xxxxxx
Xxxxxx, Xx. Xxxxx, Xxxxxxxx 00000 (hereinafter referred to as "GA").
WITNESSETH:
WHEREAS, the parties hereto desire to enter into this Agreement to
provide for the provision by XxXxxxxx, as an independent subcontractor, of
insurance policy administration services to GA on the terms and conditions
hereinafter set forth,
NOW, THEREFORE, in consideration of the mutual covenants hereinafter
set forth, and other good and valuable considerations, the receipt and
sufficiency of which are hereby acknowledged, and intending to be legally bound,
the parties hereto hereby agree as follows:
SECTION 1 DEFINITIONS.
As used in this Agreement, the following terms shall have the meaning
set forth:
1.01 Books and Records. "Books and Records" means all books and records
in the possession or control of XxXxxxxx that contain information related to the
Policies (defined in Section 1.08 below) and Participants Policies (defined in
Section 1.10 below), including without limitation, to the extent any of the
following exist, (i) hard copy and microfiche records; (ii) all paper files;
(iii) all electronic images; (iv) all computer data files; (v) all
correspondence between XxXxxxxx and owners of Policies; (vi) administrative
records; (vii) claim records; (viii) sales records; (ix) reinsurance records,
(x) underwriting records and (xi) accounting records; provided, however, that
Books and Records shall not include any of XxXxxxxx'x internal documentation of
its own programs, systems and procedures or any of XxXxxxxx'x books and records
which are not directly related to the Policies.
1.02 Case. "Case" means a group of Policies that have a common
owner and payor, have a common corporate objective, and/or a group of
Participants that are part of a common benefit plan.
1.03 End User. "End User" means a party for whom GA has agreed to
provide Plan Administration Services which are the subject of this Agreement.
1.04 Effective Date. "Effective Date" means September 1, 1998.
1.05 Initial Term. "Initial Term" means the five (5) year period
commencing on the Effective Date of this Agreement and ending at 11:59 p.m. on
the day, prior to the fifth anniversary of the Effective Date.
1.06 Policy Administration Services. "Policy Administration
Services" means the services set forth in Exhibit A attached hereto and
designated as "Policy Administration Services".
1.07 Policies. "Policies" means, collectively, the insurance
policies included within one of the Products and "Policy" means any one of the
Policies.
1.08 Products. "Products" means the insurance products described in
Exhibit E attached hereto and made a part hereof. A "Product" is limited to a
single policy form of an insurance company. Exhibit E may be amended during the
Term by mutual written agreement of the parties hereto.
SECTION 2 TERM.
This Agreement shall commence on September 1, 1998 and shall continue
in effect for the Initial Term; thereafter this Agreement shall continue in full
force and effect from year to year until terminated as herein provided, each
such additional year being an "Additional Term" of this Agreement. The Initial
Term and any Additional Terms hereunder are herein collectively referred to as
the "Term".
SECTION 3 POLICY ADMINISTRATION.
3.01 Administrative Services. During the Term, XxXxxxxx shall
perform Policy Administration Services (sometimes referred to as the
"Administration Services").
3.02 Performance Criteria. The manner and method of performing
Administration Services is set forth in Exhibit C.
3.03 Authorized Personnel. At any time XxXxxxxx may apply to a
person indicated on the "Schedule of Authorized Personnel", attached hereto as
Exhibit F, as a person authorized to give instructions under this section with
respect to any matter arising in connection with this Agreement. XxXxxxxx shall
not be liable for, and shall be indemnified and held harmless by GA against any
loss, cost, damage or expense arising from, any action taken or omitted by
XxXxxxxx to the extent XxXxxxxx can demonstrate that the action or omission was
taken or omitted in good faith in reliance upon such instruction.
GA may at any time provide XxXxxxxx with written notice of any change
of authority of persons authorized and enumerated in Exhibit F to provide
XxXxxxxx with instructions or directions relating to services to be performed by
XxXxxxxx under this Agreement.
3.04 Records. During the Term, XxXxxxxx shall keep true and correct
Books and Records relating to the performance of all Administration Services
hereunder. XxXxxxxx shall
deliver the Books and Records and copies thereof to GA, if so requested by GA,
within thirty (30) days upon termination of this Agreement. Anything herein to
the contrary notwithstanding, XxXxxxxx shall be allowed to make and retain
copies of the Books and Records, at its own expense, upon termination of this
Agreement. It is acknowledged and agreed that any such Books and Records may be
maintained on magnetic media, electronic media, microfiche, CD and other
non-paper media.
SECTION 4 FEES AND EXPENSES.
4.01 Administration Fees.
(a) During the Initial Term of thus Agreement, GA shall pay to
XxXxxxxx, as compensation for all Administration Services rendered pursuant to
this Agreement, the amounts set forth in Exhibit D. In no event, except as
provided below, will the fees payable by GA to XxXxxxxx hereunder be less than
the fees determined by the application of the Minimum Charges set forth in
Exhibit D.
(b) For each Additional Term of this Agreement, GA shall pay to
XxXxxxxx, as compensation for all Administration Services rendered pursuant to
this Agreement, such fees and charges as shall be agreed to by the parties and
attached hereto as an amended Exhibit D prior to commencement of such Additional
Term.
4.02 Expenses. GA will promptly reimburse XxXxxxxx for all
reasonable out-of-pocket expenses incurred by XxXxxxxx in the performance of
this Agreement. Out-of-pocket expenses include, but are not limited to the
following:
(a) Travel related costs for travel requested by GA.
(b) Postage, forms, mailings, stationery and shipping costs
requested by GA.
(c) Charges for telephone line(s), long distance telephone calls
and remote access dedicated to service of GA, GA customers,
agents and brokers.
(d) Charges for the acquisition, installation and maintenance of
any hardware, software and telecommunication lines required
for remote system connectivity.
(e) Charges for supplies and maintenance of dedicated GA hardware
and equipment including but not limited to printers, faxes,
modems, etc.
(f) Charges for GA dedicated U.S. Post Office boxes.
(g) Monthly access charge of $150 for internet connection plus
monthly per kilobyte charge for GA's actual band width usage
based on Internet Service Provider's then current rates.
4.03 System Enhancements. Requests by GA for enhancements to
systems or procedures for support of new products or new functional capabilities
will be performed and billed by XxXxxxxx to GA pursuant to that certain
Consulting Services Agreement of even date herewith.
4.04 Payment. During the Term of this Agreement, GA shall pay
XxXxxxxx within thirty (30). days of the date of XxXxxxxx'x invoice. Late
payments shall be subject to
XxXxxxxx'x standard late payment charges. A finance charge of one and one-half
(11/2%) percent monthly (annual rate of eighteen (18%) percent), or the highest
interest rate allowed by law, whichever is lower, will be added to all invoices
not paid within thirty (30) days after the date of the invoice. In addition,
failure of GA to fully pay any invoiced amount within sixty (60) days after the
date of the invoice shall be deemed a material breach of the Agreement.
SECTION 5 REPRESENTATIONS AND WARRANTIES OF XXXXXXXX.
XxXxxxxx hereby represents and warrants to GA as follows:
(a) It is a limited liability company duly organized and existing
and in good standing under the laws of the State of Georgia.
(b) It is empowered under applicable laws and by its articles of
organization and operating agreement to enter into and perform the services
contemplated in this Agreement.
(c) All requisite proceedings have been taken to authorize it to
enter into and perform the services contemplated in, and execute and deliver,
the Agreement.
(d) It has duly executed and delivered this Agreement and neither
such execution and delivery nor the performance by it of any of its obligations
under this Agreement will (i) violate any provision of its certificate of
incorporation or by-laws, (ii) result in a violation or breach of, or constitute
a default or an event of default under, any indenture, mortgage, bond or other
contract, license, agreement, permit, instrument or other commitment or
obligation to which it is a party or (iii) violate any law, rule or regulation
of any governmental body, writ, judgment, injunction or court decree
(collectively, "Laws") applicable to it or its business.
(e) It has all licenses, permits, registrations and other
governmental approvals necessary or advisable for the performance of its
obligations under this Agreement.
(f) Its business operations have been conducted, are now, and will
continue to be in compliance in all material respects with all Laws.
(g) In its reasonable business judgment, it has the facilities,
equipment and personnel necessary to carry out its duties and obligations under
this Agreement.
SECTION 6 REPRESENTATIONS AND WARRANTIES OF GA.
GA hereby represents and warrants to XxXxxxxx as follows:
(a) It is a registered stock life insurance company organized and
existing and in good standing under the laws of the State of Missouri.
(b) It is empowered under the applicable laws and regulations and
its governing documents to enter into and perform this Agreement.
(c) All requisite proceedings have been taken to authorize it to
enter into and perform this Agreement.
(d) It has duly executed and delivered this Agreement and neither
such execution and delivery, nor the performance by it of any of its obligations
under this Agreement will (i) violate any provision of its governing documents,
(ii) result in a violation or breach of, or constitute a default or an event of
default under, any indenture, mortgage, bond or other contract, license,
agreement, permit, instrument or other commitment or obligation to which it is a
party or (iii) violate any Law applicable to it or its business.
SECTION 7 ADDITIONAL COVENANTS.
7.01 Independent Contractor. It is understood and agreed that all
Administration Services performed hereunder by XxXxxxxx shall be performed
solely for GA by XxXxxxxx in the capacity of an independent sub-contractor of
GA. Nothing contained herein shall be construed to create between XxXxxxxx and
GA a partnership, joint venture, association or other legal entity or
relationship other than that of independent sub-contractor.
7.02 Confidentiality and Disclosure.
(a) Each Party to this Agreement ("Disclosing Party") may disclose
to the other party ("Recipient") certain proprietary and confidential
information including, without limitation, policyholder information, procedures,
GA customer lists, prospect lists, contracted broker and agent lists, and
material related to policy design, pricing, filings, marketing and sales
administration and systems information ("Information").
(b) Recipient agrees to maintain, during the Term and, with
respect to the Information that is not a trade secret, for a period of three (3)
years thereafter, the Information of the Disclosing Party in confidence using at
least the same degree of care as it uses in maintaining as secret its own trade
secret, confidential and proprietary information, but always at least a
reasonable degree of care. Recipient agrees to maintain, during the Term and,
with respect to Information that is a trade secret (as defined in the Georgia
Trade Secrets Act of 1990), at all times thereafter so long as the Information
remains a trade secret, the Information of the Disclosing Party in confidence
using at least the same degree of care as it uses in maintaining as secret its
own trade secret, confidential and proprietary information, but always at least
a reasonable degree of care.
(c) Disclosing Party agrees that Recipient shall have no
obligation under the provisions of this Section 7.02 with respect to any
Information which:
1. is now or hereafter becomes publicly known other than through
a breach hereof,
2. is disclosed to Recipient by a third party that Recipient
reasonably believes is legally entitled to disclose such
information,
3. is known by Recipient prior to its receipt of the Information,
without any obligation of confidentiality with respect
thereto,
4. subject to paragraph (g) below, is disclosed with the
Disclosing Party's written consent,
5. is disclosed by the Disclosing Party to a third parry without
the same or similar restrictions as set forth herein,
6. is required to be disclosed by Recipient by a court of
competent jurisdiction, administrative agency or governmental
body, or by law, rule or regulation, or by applicable
regulatory or professional standards, or
7. is disclosed by Recipient in connection with any judicial or
other legal proceeding involving the Agreement, or
8. subject to paragraph (g) below is not identified or marked as
"Confidential and Proprietary" as provided in paragraph (a).
(d) Recipient shall use reasonable efforts to limit access to
Information received from the Disclosing Party to only those personnel of
Recipient who have need of such access for the performance of any obligation of
Recipient under this Agreement.
(e) Recipient shall use information only for purposes of
fulfilling its obligations under the Agreement.
(f) Except as expressly provided in the Agreement, Disclosing
Party grants no license, right or interest to Recipient under any copyrights,
patents, trademarks, trade secrets or other property rights of Disclosing Party
by reason of the disclosure of the Information.
(g) Each party acknowledges that some Information may, under
applicable law, be deemed to be confidential information of third parties (such
as natural persons whose lives are insured under a Policy) and agrees to
preserve the confidentiality of all Information, which under applicable Law must
be treated as confidential.
The terms and conditions of this Section 7.02 shall survive the
termination of this Agreement.
7.03 Indemnification. Each party to this Agreement shall indemnify
and hold harmless the other party and its officers, directors, partners,
principals, independent contractors, employees, member firms, subcontractors and
affiliates and their respective personnel from and against any and all
liabilities, losses, damages, costs, expenses (including, without limitation,
reasonable attorneys' fees and court costs), interest, penalties or other loss
directly or indirectly arising out of, in connection with or with respect to any
breach of this Agreement or any fraudulent, criminal, negligent and/or bad faith
acts or omissions by such party or its officers,
directors, partners, principals, independent contractors, employees, member
firms, subcontractors and affiliates and their respective personnel under this
Agreement.
If a party is named in any lawsuit or other proceeding for which such
party believes it may be entitled to indemnification hereunder (other than any
action or proceeding described in Section 7.06), such party shall promptly give
notice thereof to the other party, such notice to include a description in
reasonable detail of such lawsuit or proceeding and the basis for such party's
belief that it may be entitled to indemnification hereunder. The parties shall
cooperate in all reasonable respects with each other in defending such lawsuit
or proceeding. XxXxxxxx agrees not to settle any such lawsuit or proceeding
without the written consent of GA.
The terms and conditions of this Section 7.03 shall survive the
termination of this Agreement.
7.04 Arbitration. In the event of any dispute between GA and
XxXxxxxx with respect to the subject matter of this Agreement or the enforcement
of rights hereunder, either party may, by written notice to the other, require
such dispute or difference to be submitted to arbitration. This provision,
however, shall not be applicable to any dispute that involves a claim by or
against a Third Party. The arbitrator or arbitrators shall be selected by
agreement of the parties or, if they cannot agree on an arbitrator or
arbitrators within twenty (20) days after the notice of such party's desire to
have the question settled by arbitration, then the arbitrator or arbitrators
shall be selected by the American Arbitration Association (the "AAA") in
Atlanta, Georgia. The determination reached, or award granted, in such
arbitration shall be final and binding, to the extent not in violation of law or
public policy, on all parties hereto. Enforcement of the arbitration award or
determination may be sought in any court of competent jurisdiction. The
arbitrators shall not be bound by judicial formalities and may abstain from
following the strict rules of evidence. The parties hereby mutually instruct the
arbitrators to limit the time and scope of discovery to the greatest extent
practicable and request the arbitrators to provide a decision as rapidly as
practicable, in each case consistent with the interests of justice, it being the
intention of the parties that any arbitration under this Section 7.04 be
commenced, conducted and completed, and a decision rendered, as rapidly as
practicable. Pending such decision, each party will continue to perform its
obligations under this Agreement. Unless otherwise agreed by the parties, any
such arbitration shall be conducted in accordance with the rules of the AAA.
In the event of any litigation or arbitration as provided under this
Agreement, or the enforcement of rights hereunder, each party shall bear its own
costs and expenses relating to such litigation or arbitration, including
reasonable attorney's fees and expenses, unless otherwise provided by the
arbitration award or determination. In no event shall the arbitrators have the
right or authority to award consequential, incidental, indirect, special or
punitive damages relating to this Agreement.
The terms and conditions of this Section 7.04 shall survive the
termination of this Agreement.
7.05 Compliance. XxXxxxxx shall provide staff with the skills
necessary to perform the Administrative Services, as determined by XxXxxxxx
using its reasonable business
judgment. XxXxxxxx shall obtain and maintain for itself, all licenses necessary
for performance under this Agreement.
7.06 Actions.
(a) Each party to this Agreement (the "Notifying Party") shall
promptly notify the other party of any threatened or pending lawsuit or
governmental or regulatory agency inquiry or complaint relating to Policies of
which the Notifying Party has actual knowledge and shall promptly transmit to
such other party a copy of any applicable service of process or other instrument
related to a court proceeding or any correspondence or other document
transmitted to or from any governmental or regulatory agency relating to the
Policies which shall be actually received by the Notifying Party.
(b) XxXxxxxx shall make no response to any governmental or
regulatory agency's inquiry or complaint relating to Policies without first
obtaining GA's approval and consent to the response to such inquiry or
complaint; provided, however, that if GA fails to give its approval or consent
or delays its approval or consent and such failure or delay would subject
XxXxxxxx to any fine, penalty, liability or sanction, then XxXxxxxx may make a
response.
(c) GA reserves the right to control the defense of any
litigation, threatened or pending, by or against it, or to respond on its own
behalf to any governmental or regulatory agency's inquiry or complaint;
provided, however, that if GA shall exercise this right in such a manner as
shall subject XxXxxxxx to any fine, penalty, liability or sanction for failure
to follow procedure, or otherwise in a manner which, in the reasonable opinion
of XxXxxxxx or its legal counsel may have a material adverse effect on XxXxxxxx,
then XxXxxxxx shall have the right to defend itself with counsel of its choice
at its own expense.
(d) XxXxxxxx reserves the right to control the defense of any
litigation, threatened or pending, by or against it, or, subject to subsection
(b) above, to respond on its own behalf to any governmental or regulatory
agency's inquiry or complaint; provided, however, that if XxXxxxxx shall
exercise this right in such a manner as shall subject GA to any fine, penalty,
liability or sanction for failure-to follow procedure, or otherwise in a manner
which, in the reasonable opinion of GA or its legal counsel may have a material
adverse effect on GA, then GA shall have the right to defend itself with counsel
of its choice at its own expense.
(e) The parties shall cooperate with each other in responding to
or defending any such lawsuit, threat, demand, inquiry, complaint,
administrative or regulatory investigation or proceeding.
7.07 Records. Each party to this Agreement shall maintain,
following the termination of this Agreement for any reason, its Books and
Records with respect to business produced under this Agreement for such period
of time as may be required by law. It is acknowledged and agreed that any such
books and records may be maintained on magnetic media, electronic media,
microfiche or other non paper media.
7.08 Audit. Upon forty-eight (48) hours advanced notice to
XxXxxxxx, GA will have the right under this Agreement to perform on-site
inspection and analyses of the Books and Records in accordance with reasonable
procedures and at reasonable frequencies. At the request of GA, XxXxxxxx will
make available to GA representatives of the appropriate regulatory agencies all
reasonable requested Books and Records and access to operating procedures.
7.09 Security of Operations. XxXxxxxx shall maintain such off-site
backup of its systems, procedures, and Books and Records as GA may reasonably
request. XxXxxxxx shall maintain at all times during the Term a disaster
recovery capability materially consistent with that currently maintained by
XxXxxxxx.
7.10 Insurance Coverage. XxXxxxxx shall use its reasonable efforts
to continue in effect the insurance coverages described in Exhibit G attached
hereto provided that such coverage is available from a domestic insurance
carrier at a reasonable cost to XxXxxxxx. XxXxxxxx shall not voluntarily cause
any termination, reduction, or alteration of these coverages without thirty (30)
days prior written notice to GA.
SECTION 8 TERMINATION OF AGREEMENT.
8.01 By Mutual Agreement. This Agreement may be terminated or
amended by mutual written agreement of the parties at any time.
8.02 By Non-Renewal. At least one hundred and eighty (180) days
prior to the end of the Initial Term and any Additional Term hereof, either
party may give the other notice if the party delivering such notice desires to
change any term of the Agreement. If XxXxxxxx and GA do not agree in writing
with respect to the matters described in such notice before the end of the Term
during which XxXxxxxx gives such notice, this Agreement shall terminate at the
end of such Term.
8.03 For Cause. If either of the parties hereto shall materially
breach this Agreement or be materially in default hereunder (the Defaulting
party), the other party hereto may give written notice thereof to the Defaulting
Parry and if such default or breach shall not have been remedied within thirty
(30) days after such written notice is given, then the party giving such written
notice may terminate this Agreement by giving thirty (30) days written notice of
such termination to the Defaulting Party. Termination of this Agreement by
default or breach by a party shall not constitute a waiver of any rights of the
other xxxxx in reference to services performed prior to such termination, rights
to be reimbursed for out-of-pocket expenditures or any other rights such other
party might have under this Agreement at lacer, in equity or otherwise.
SECTION 9 ASSIGNMENT.
9.01 Assignment by GA. GA shall not, directly or indirectly, in
whole or in part, assign any of its rights or obligations hereunder without the
prior written consent of XxXxxxxx, which consent shall not be unreasonably
withheld.
9.02 Assignment by XxXxxxxx. XxXxxxxx shall not directly or
indirectly, in whole or in part, delegate its duties or assign its rights under
this Agreement without the prior written consent of GA, which consent shall not
be unreasonably withheld.
SECTION 10 MISCELLANEOUS.
10.01 Governing Law. This Agreement shall be governed by, and
construed in accordance with, the laws of the State of Georgia, without giving
effect to the principles of conflicts of laws thereof.
10.02 Notices. Any notice, consent, approval or other communication
required or permitted hereunder shall be in writing and shall be delivered
personally, or sent by facsimile transmission, overnight courier service or by
registered or certified mail, postage prepaid, return receipt requested, and
addressed as follows:
(a) If to XxXxxxxx:
XxXxxxxx Systems, L.L.C.
0000 Xxxxxx Xxxxx Xxxx
Xxxxx Xxxxx
Xxxxxxx, XX 00000.
Attention: J. Xxxxxx Xxxxxxx, Jr., Vice Chairman
Facsimile Number: (000) 000-0000
(b) If to GA:
General American Life Insurance Company
000 Xxxxxx Xxxxxx
Xx. Xxxxx, XX 00000
Attention: R. Xxxxx Xxxxxx, Assistant Vice President
Facsimile Number: (000) 000 0000
Any such notice shall be deemed given when so delivered (in the case of
personal delivery or overnight courier service) or sent by facsimile
transmission or, if mailed, upon receipt as evidenced by the return receipt. If
the address of any party hereunto is changed, written notice of such change
shall be given to the other party, in accordance with this Section, and said new
address shall be used for purposes of this Agreement.
10.03 Entire Agreement. This Agreement, the Exhibits which are
attached hereto and made a part hereof, and the documents executed pursuant
hereto, contain the entire understanding of the parties with respect to the
subject matter hereof and thereof and no representation, warranty, covenant or
agreement not embodied herein or therein, oral or otherwise, shall be of any
force or effect whatsoever with respect to the subject matter hereof or thereof.
Further, no change, amendment or modification of this Agreement shall be
effective unless in writing and signed by both parties hereto.
10.04 Binding Effect. This Agreement shall be binding upon and shall
inure to the benefit of the parties hereto and their respective successors and
permitted assigns.
10.05 Severability. In the event any one or more of the provisions
contained in this Agreement shall, for any reason, be held to be invalid,
illegal or unenforceable in any respect, such invalidity, illegality or
unenforceability shall not affect any other provision of this Agreement.
10.06 No Third Party Beneficiaries. Nothing in this Agreement is
intended or shall be construed to give any person, other than the parties
hereto, any legal or equitable right, remedy or claim under or in respect of
this Agreement or any provision contained herein.
10.07 Headings. The Section headings of this Agreement are for
convenience only and shall not affect the construction or interpretation of this
Agreement.
10.08 Counterparts. This Agreement may be executed in two (2) or
more counterparts, each of which shall be deemed an original but all of which
will constitute one and the same document.
10.09 Waiver.
(a) A waiver of any default or breach hereunder granted by any
party hereto shall not constitute a waiver by such party of any other default or
breach or a waiver by such party of the same default or breach at a later time.
Further, to be effective, any such waiver must be in writing and be signed by
the party granting such waiver.
(b) Subject to the last sentence of Section 10.09(a), the
forbearance or neglect by GA or XxXxxxxx to insist upon strict compliance with
any of the provision of this Agreement, or to declare a forfeiture or
termination, shall not be construed as a waiver of any right or privilege
hereunder. No waiver of any right or privilege arising from any default or
failure of performance hereunder shall affect the rights or privileges of either
party in the event of a further default or failure of performance hereunder.
10.10 Construction. All parties hereto have participated, directly
or indirectly, in the negotiations and preparation of this Agreement. In no
event shall this Agreement be construed more or less stringently against any
party hereto by reason of either party being construed as the principal drafting
party hereto.
10.11 Taxes. All sales, use, excise or other similar taxes or duties
which may be or become payable on account of goods or services provided
hereunder shall be payable by GA to XxXxxxxx Systems upon the receipt by GA of
XxXxxxxx Systems' invoice therefor. In lieu of paying such taxes, GA may provide
XxXxxxxx Systems with a tax exemption certificate acceptable in form and
substance to the appropriate taxing authorities.
10.12 Software Escrow Xxxxxxxxx.Xx soon as is practicable after the
execution of this Agreement, (i) the parties hereto shall execute and deliver an
Escrow Agreement substantially in
the form of Exhibit H attached hereto and made a part hereof (the "Escrow
Agreement") for the purpose of protecting GA in the event of a breach of this
Agreement by XxXxxxxx or the termination of this Agreement by GA for Cause,
pursuant to Section 8 hereof, prior to the end of the Term; and (ii) upon
execution of the Escrow Agreement by all parties thereto, XxXxxxxx shall deposit
with the Escrow Agent a copy of the Software to be held in accordance with the
terms and conditions of the Escrow Agreement.
10.13 Software License in Escrow As soon as is practicable after
execution of the Escrow Agreement, the parties hereto shall execute and deliver
to the Escrow Agent, to be held in accordance with the terms and conditions of
the Escrow Agreement, a License Agreement substantially in the form of Exhibit I
attached hereto and made a part hereof (the "License Agreement") which shall
provide that in the event the Software shall be released by the Escrow Agent to
GA, upon the occurrence of a Release Event (as defined in the Escrow Agreement),
but only in such event, XxXxxxxx grants to GA, effective upon receipt of the
Software from the Escrow Agent, a license to use the Software (and such
modifications, enhancements, improvements, updates, corrections or changes as GA
shall elect to make to the Software) (the "Software License") for a period of
twenty-four months following the termination of this Agreement, solely on the
terms and conditions of the License Agreement. At the expiration of the license
term, GA shall have no further rights with respect to the Software.
10.14 Force Majeure. Neither party shall be in default of this
Agreement to the extent that the performance of its obligations under this
Agreement is delayed or prevented by reason of any act of God, fire, natural
disaster, accident, act of government, strike, riot, act of war, restricting
legislation, embargo, blockade, work stoppage, or any other like cause beyond
the control of such party, provided that such causes shall not relieve GA of its
payment obligations as set forth in Sections 3 and 4 (except that GA shall not
be required to make payment for services not rendered by reason of such a force
majeure condition).
SECTION 11 YEAR 2000 COMPLIANCE.
XxXxxxxx hereby represents and warrants that the VPAS* Life
administration system software is Year 2000 Compliant. For these purposes, Year
2000 Compliant is defined to mean that this software:
(a) uses date data century recognition, and as appropriate, same
century and multi-century formulas and date values in each instance for all
calculations for which a date is used;
(b) will not abnormally end or provide invalid or incorrect
results as a result of date data, specifically including date data which
represents or references different centuries or more than one century; and
otherwise conforms with the current industry standards in order that it will
fully perform without any errors or other problems due to the year being greater
than 1999;
(c) will correctly manage and manipulate data involving dates,
including, but not limited to: single-century formulas and multi-century
formulas, century recognition and calculations that accommodate same century and
multi-century formulas, comparing and sequencing, and
leap year calculations; and will operate without any time or Year 2000 related
defects or abnormalities; and
(d) to the extent that the software will accept data from other
systems and sources that are not Year 2000 Compliant, the software will properly
recognize, calculate, sort, store output, and otherwise process such data in a
manner that eliminates any century ambiguity so that the software remains Year
2000 Compliant.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed and delivered by their duly authorized partners and officers, all as of
the date first above written:
XxXxxxxx Systems, L.L.C.
By: /s/ J. Xxxxxx Xxxxxxx, Jr.
J. Xxxxxx Xxxxxxx, Jr.
Vice Chairman
General American Life Insurance Company
By: /s/ R. Xxxxx Xxxxxx
R. Xxxxx Xxxxxx
Assistant Vice President
EXHIBIT A
SPECIALTY PRODUCTS INSURANCE CONTRACT
ADMINISTRATION SERVICES
The XxXxxxxx BPO operations provides the following array of services. All
services are performed in accordance with the actual procedures and standards as
detailed in a separate document entitled "BPO Operations Manual" which is made
part of this contract by reference, and may change from time to time by the
mutual consent of both parties. Services that are stated to be executed
"electronically" are included under base charges if these services are executed
other than electronically, an additional charge might apply. All charges are
detailed in Exhibit D of this contract.
1. XxXxxxxx will perform the following services related to the policy
issue process:
(a) XxXxxxxx will, upon receipt of Case Set up Worksheet for new
cases, set up the case and case version information.
(b) XxXxxxxx will, upon receipt of policy application data,
perform the following:
(i) Review application;
(ii) Check product approval status;
(iii) Follow up with GA and/or agent for missing
application information;
(iv) Determine and report product related requirements for
each applicant according to the BPO Operations
Manual;
(v) Assign policy numbers, if required;
(vi) Electronically feed to GA's underwriting system;
(vii) Electronically accept changes in the underwriting
status in accordance with the BPO Operations Manual.
(c) XxXxxxxx will, upon completion of the underwriting process, produce a
set of policy pages for a master contract and a specification page for
each policy. XxXxxxxx will review policy and specification pages for
accuracy. Additional sets due to any GA requested changes will be
produced subject to additional charges set forth in Exhibit D.
EXHIBIT A
SPECIALTY PRODUCTS INSURANCE CONTRACT
ADMINISTRATION SERVICES
(d) XxXxxxxx will prepare Policy Delivery Requirements (Amendments,
Delivery Receipts).
(e) XxXxxxxx will prepare post-underwriting amendments to application in
accordance with the BPO Operations Manual.
(f) XxXxxxxx will track return of signed delivery requirements, providing
aged status report and take specified action if requirement is not
returned in accordance with the BPO Operations Manual.
(g) XxXxxxxx will determine the date on which the free look period expires
and the initial allocation takes place according to GA provided rules.
(h) XxXxxxxx will process completed paperwork relating to Section 1035
exchanges for guaranteed issue applications as part of the base fee. If
not guaranteed issue, XxXxxxxx will- process completed paperwork
relating to Section 1035 exchanges for an additional fee as set forth
in Exhibit D.
2. XxXxxxxx will perform the following services related to the renewal
function:
(a) XxXxxxxx will, for policies with automatic death benefit
change provisions and upon receipt of updated census data,
perform the following services:
(i) Perform eligibility and product related edits;
(ii) Provide GA with target death benefit and underwriting
criteria;
(iii) Process death benefit changes and produce new policy
specification pages as required in accordance with
the BPO Operations Manual.
3. XxXxxxxx will perform the following services related to the policy
administration function:
2
EXHIBIT A
SPECIALTY PRODUCTS INSURANCE CONTRACT
ADMINISTRATION SERVICES
(a) XxXxxxxx will prepare and distribute an initial and model
billing kit for premiums and loan interest due in accordance
with the BPO Operations Manual. The annual renewal billing kit
will be in accordance with the BPO Operations Manual. At any
time prior to the due date and upon request by the policy
owner, XxXxxxxx will prepare an additional billing kit at an
additional cost as set forth in Exhibit D.
(b) XxXxxxxx will, upon expiration of the free look period, cause
the initial allocation of policy funds from the free look
default fund into the policy owner's selected funds.
(c) Where XxXxxxxx is not responsible for receiving or directly
handling any of GA or the policy owner's premiums, upon
notification by GA of receipt of payment, XxXxxxxx will
perform the following services:
(i) Update Case/Policy suspense records;
(ii) Reconcile cash received versus premiums due;
(iii) Apply premium and/or loan interest, and/or loan
repayment;
(iv) Create accounting journal entries.
(d) Where XxXxxxxx receives and directly handles GA or policy
owner premiums, upon receipt, McCarnish will perform the
following services.
(i) Deposit checks into a GA bank account;
(ii) Maintain bank account deposit records;
(iii) Apply cash to system suspense;
(iv) Reconcile cash received versus premiums due;
(v) Apply premium and/or loan interest, and/or loan
repayment;
(vi) Create check or wire request for disbursement of
unapplied cash;
(vii) Create accounting journal entries.
3
EXHIBIT A
SPECIALTY PRODUCTS INSURANCE CONTRACT
ADMINISTRATION SERVICES
(e) XxXxxxxx will provide the following services related to death claims:
(i) Perform claim adjudication for uncontested claims, to ensure
that the claim should be paid;
(ii) Transfer separate account funds into a designated fund;
(iii) Send bereavement letter,
(iv) Obtain death certificate;
(v) Establish pending death claim as necessary to prevent billing
and other transactions;
(vi) Calculate net proceeds and interest on proceeds;
(vii) Identify net cash refunds of transactions occurring after the
date of death;
(viii) Create Death Claim Worksheet and payment letter;
(ix) Create check or wire request for disbursement of claim
proceeds;
(x) Create accounting journal entries;
(xi) Produce monthly pending claim status reports as necessary.
(f) XxXxxxxx will perform the following services related to other polity
terminations, including not taken, surrender, rescission, lapse and
maturity:
(i) Calculate net surrender value or net amount due;
(ii) Create Termination Worksheet or Rescission Worksheet and cover
letter;
(iii) Create check or wire request for disbursement of proceeds;
(iv) Create accounting journal entries.
(g) XxXxxxxx will perform the following services in accordance with the BPO
Operations Manual:
(i) Create an invoice for loan interest due;
4
EXHIBIT A
SPECIALTY PRODUCTS INSURANCE CONTRACT
ADMINISTRATION SERVICES
(ii) Capitalize due and unpaid loan interest;
(iii) Create accounting journal entries.
(h) XxXxxxxx will perform the following services as part of periodic
insurance deduction processing.
(i) Compute and deduct periodic fees and charges due;
(ii) Compute and deduct cost of insurance for all coverages and
benefits;
(iii) Compute and credit interest to fixed funds;
(iv) Perform grace period and lapse processing on policies failing
equity test;
(v) Create accounting journal entries.
(i) XxXxxxxx will, upon request, perform the following policy services:
(i) Process changes of owner, payor or beneficiary;
(ii) Process assignments;
(iii) Process name or address changes;
(iv) Process change in coverage and coverage amount;
(v) Process change in death, benefit option;
(vi) Process change in dividend option;
(vii) Process change in bank information for electronic funds
transfers;
(viii) Process change in sex, birth date, and policy rating criteria
of insured.
(j) XxXxxxxx will, upon request, perform the following financial event
services:
(i) Process premium remittances;
(ii) Process loan repayment and loan interest payment remittances;
(iii) Process loans;
(iv) Process partial withdrawals;
5
EXHIBIT A
SPECIALTY PRODUCTS INSURANCE CONTRACT
ADMINISTRATION SERVICES
(v) Process dividend distributions;
(vi) Create check or wire request for disbursements, as
appropriate;
(vii) Create accounting journal entries.
(k) XxXxxxxx will, upon request, perform the following policy asset related
services, limited to once per case, per month:
(i) Process rebalance of assets;
(ii) Process transfer of assets;
(iii) Process reallocation of assets;
(iv) Process dollar cost averaging of assets;
(v) Process change in investment allocations;
(vi) Create accounting journal entries;
(vii) Perform above services in excess of once per case, per month
at an additional cost as set forth in Exhibit D.
4. XxXxxxxx will perform the following services related to agent/broker
commissions and service fees:
(a) XxXxxxxx will perform the following standard services:
(i) As a byproduct of premium payment, calculate earned
commissions and/or service fees;
(ii) On a specified schedule, calculate asset based
commissions,
(iii) Create accounting journal entries for booking earned
commissions and agents balances;
(iv) Calculate commission and fee reversals due to policy
termination;
(v) Process changes to agent information;
(vi) Prepare commission extracts for interface to GA's
commission system.
6
EXHIBIT A
SPECIALTY PRODUC'T'S INSURANCE CONTRACT
ADMINISTRATION SERVICES
(b) XxXxxxxx will perform the following services on a time and
expense basis using its then current consulting rates:
(i) Process changes in commission structure;
(ii) Process commission and fee reversals for correction
processing;
(iii) Calculate asset based commissions on an unscheduled
or manual basis.
(c) Other services related to agent/broker commissions are
available through the VPAS(R) Agent Compensation System
subject to an additional charge as set forth in Exhibit D.
5. XxXxxxxx will produce the following processing related reports:
(a) Policy owner reports (one paper copy for policy owner and one
paper copy for servicing agent):
(i) Confirmation of Policy Activity (variable products
only) as needed;
(ii) Quarterly Statement of Policy Activity;
(iii) Cash Value Summary.
(b) Daily processing reports (one paper copy for GA):
(i) Transaction Registers;
(ii) Error Report;
(iii) Accounting journal;
(iv) Check Register;
(v) Billing Register;
(vi) Disbursement Suspense;
(vii) Deposit Suspense;
7
EXHIBIT A
SPECIALTY PRODUCTS INSURANCE CONTRACT
ADMINISTRATION SERVICES
(viii) Daily Unit Value Report.
(c) XxXxxxxx will develop special reports or services as requested
on a time and expense basis using its then current consulting
rates.
(d) XxXxxxxx will produce additional copies of processing related
reports for an additional fee as set forth in Exhibit D.
6. XxXxxxxx will perform the following services related to fund pricing
and trading, subject to additional charges as set forth in Exhibit D:
(a) For each fund XxXxxxxx is required to value, XxXxxxxx will, on
fund valuation days and upon receipt of the Net Asset Value
(NAV) or Asset Unit Value (AUV):
(i) Compute mortality & expense charge;
(ii) Compute Unit Value;
(iii) Update the Price Table;
(iv) Create accounting journal entries.
(b) XxXxxxxx will electronically transmit daily on GA processing
days:
(i) Fund trading activity;
(ii) Fund Summary Report;
(iii) Fund Detail Report;
(iv) Transmit above reports by fax for an additional fee
as set forth in Exhibit D.
(c) XxXxxxxx will prepare a periodic statement of mortality &
expense charges due for each fund.
8
EXHIBIT A
SPECIALTY PRODUCTS INSURANCE CONTRACT
ADMINISTRATION SERVICES
7. XxXxxxxx will provide GA with the following services related to the
insurance carrier financial reporting function;
(a) XxXxxxxx will provide GA with the following accounting
reports, on a monthly basis, in a printable format and on CD,
unless noted as CD only. Printed copies will be provided for
an additional fee as specified in Exhibit D:
(i) Summary of Monthly Activity;
(ii) Trial Balance - YTD All Cases;
(iii) Trial Balance - YTD by Case;
(iv) Trial Balance - YTD by Product;
(v) Trial Balance - YTD by Fund;
(vi) Collection Suspense Recap;
(vii) Disbursement Clearing.
(b) XxXxxxxx will provide, on a specified basis (normally each
business day), an electronic data feed of accounting entries
in accordance with the BPO Operations Manual.
(c) XxXxxxxx will provide the following Valuation and Policy
Exhibit reports, as required, on a monthly basis, in a
printable format and on CD, unless noted as CD only:
(i) Policy Loan Summary;
(ii) Coverage Reserves Detail;
(iii) Coverage Reserves Summary;
(iv) Reserves Released Detail;
(v) Reserves Released By Case;
(vi) Coverage Reserves By Case;
(vii) Experience Credit Contingency Reserve;
9
EXHIBIT A
SPECIALTY PRODUCTS INSURANCE CONTRACT
ADMINISTRATION SERVICES
(viii) Pending Death Claim Reserve;
(ix) Death Claim History.
(d) XxXxxxxx will provide GA with a monthly electronic feed of
reinsurance activity.
(e) XxXxxxxx will provide GA with a monthly electronic feed of
specified financial management information data in accordance
with the BPO Operations Manual.
(f) XxXxxxxx will provide GA with any of the above electronic
feeds and CD's in excess of once per month for an additional
fee as set forth in Exhibit D.
8. XxXxxxxx will set up data interfaces to and from GA on a time and
expense basis using its then current consulting rates.
9. XxXxxxxx will provide GA with a standard data interface for which the
operational support is covered by the base fee for the following;
(a) Accounting;
(b) Commissions;
(c) Valuation;
(d) Trades;
(e) Reinsurance;
(f) Agent Management File;
10
EXHIBIT A
SPECIALTY PRODUCTS INSURANCE CONTRACT
ADMINISTRATION SERVICES
(g) Others as requested by GA for an additional fee as set
forth in Exhibit D.
10. XxXxxxxx will accept from GA standard data interfaces for the
following:
(a) Pricing (Unit Value or Share Price for Unit Value
Calculation);
(b) Others as requested by GA for an additional fee as set forth
in Exhibit D.
11. XxXxxxxx will provide the following remote access subject to security
authorization and subject to additional fees as set forth in Exhibit D:
(a) Wide Area Network access from designated GA office(s),
providing inquiry and-report request capability;
(b) Dial In access by GA employees, providing inquiry access, and
by designated agents/brokers, providing policy inquiry and
report request capability;
(c) Internet access by GA employees, designated agents/brokers,
and policy owners, providing policy inquiry and report request
capability;
(d) Interactive Voice Response access by agents/brokers and policy
owners, providing policy inquiry and report request
capability.
12. XxXxxxxx will provide the following after hours functions:
(a) Processing of one standard cycle per business day;
(b) Additional cycle processing as requested on a time and expense
basis using its then current consulting rates.
11
EXHIBIT C
PERFORMANCE CRITERIA
1. XxXxxxxx shall discharge its duties hereunder in a manner that is
consistent with industry practices.
2. Performance with respect to Policy Administration Services shall
include the following.
(a) XxXxxxxx will electronically, or by hard copy or both as
periodically agreed upon by GA and XxXxxxxx, provide GA with
copies of all policy owner and agent/broker reports, letters
and other correspondence on an agreed upon basis;
(b) Calculation of policy values, dividends, policy distributions,
and commissions will be made in accordance with procedures
agreed to by GA and XxXxxxxx and will not be changed without
prior approval by GA;
(c) Specimens of each policy owner and agent/broker report
referenced in Exhibit A - Policy Administration Services will
be provided to GA and changes to existing report formats or
development of new reports will be provided to GA for approval
prior to use;
(d) Calculation of death proceeds will be done in accordance with
procedures agreed to by GA, and will be sent to GA within
three (3) working days following receipt by XxXxxxxx of all
required documentation.
3. Performance with respect to financial reporting shall include the
following.
(a) XxXxxxxx will deliver financial reports within five (5)
working days following the accounting close, as agreed to by
GA and XxXxxxxx;
1
EXHIBIT C
PERFORMANCE CRITERIA
(b) XxXxxxxx will maintain financial records in accordance with
procedures agreed to by GA and XxXxxxxx and will not change
procedures without prior approval by GA.
4. GA and XxXxxxxx may mutually agree, from time to time, to modifications
of the administrative services and/or performance criteria or to
additional administrative services and/or performance criteria.
2
EXHIBIT D - PART I
SPECIALTY PRODUCTS
POLICY ADMINISTRATION
OPTION A
The total fee charged each month will be the greater of (a) the Minimum Monthly
Charge (as set forth below) or (b) the Base Policy Administration Fee (as set
forth in Exhibit D-Part II).
--------------------------------------------
Minimum Fees Monthly Fee Annual Fee
--------------------------------------------
Months 1-12 $25,000 $300,000
--------------------------------------------
Months 13-24 $30,000 $360,000
--------------------------------------------
Months 25-36 $35,000 $420,000
--------------------------------------------
Months 37-60 $40,000 * $480,000 *
--------------------------------------------
* Inflation Adjusted Thereafter
Fees, if any, from Exhibit D - Part III are in addition to the fees resulting
from (a) or (b) above.
EXHIBIT D - PART II
FEE SCHEDULE
SPECIALTY PRODUCTS INSURANCE CONTRACT
ADMINISTRATION SERVICES
Base Administration Fees. The Base Administration Fees apply against the Monthly
Minimum Fee.
-----------------------------------------------------------------------------------------------------------------
1. Policy/Contract Administration Fee (Option A): $2.50 per Contract
-----------------------------------------------------------------------------------------------------------------
Policy/Contract Administration Pee (Option B): $21.00 per Contract
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
2. Policy/ Contract Issue Fees:
-----------------------------------------------------------------------------------------------------------------
Application Data Entry Fee - The Fee for manually capturing and entering $15.00 per application
application data.
No additional charge if the application data is provided in a machine-readable
form.
-----------------------------------------------------------------------------------------------------------------
Replacement Processing - The fee for processing replacement contracts, $3.00 per Replaced Contact
including securing a signed
Replacement Form and capturing the Cost Basis of replaced contracts.
-----------------------------------------------------------------------------------------------------------------
Delivery Kit Processing for Individual Contracts - $10.00 per Policy Contract.
This fee applies when a Delivery Kit is required for each individual contract
and covers printing and assembling the Delivery Kit, including a Welcome Letter,
Policy Contract, Amendments and Delivery Receipt.
-----------------------------------------------------------------------------------------------------------------
Delivery Kit Processing for Group or Master Contract - This fee applies when $25.00 per Master Contract
the Delivery Kit consists of a single master contract and individual plus $2.00 Per Certificate/
certificates or specification pages. Specification Page.
The fee covers printing and assembling the Delivery Kit,
including a Welcome Letter, Master Policy Contract, Amendments, Individual
Certificates/Specification Pages and Master Delivery Receipt.
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
3. Policy/Contract Asset Related Services
-----------------------------------------------------------------------------------------------------------------
The Base Administration Fee provides for one of the following asset related
services per policy, per month:
(i)Rebalance of assets;
(ii)Transfer of assets;
(iii) Reallocation of assets;
(iv)Dollar cost averaging of assets;
(v)Change in investment allocations.
$5.00 per transaction.
This fee applies for each asset related service in excess of one per month, per
policy / contract.
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
4. Fund Pricing Related Fees
-----------------------------------------------------------------------------------------------------------------
The Base Administration Fee provides for accepting Accumulation Unit Values
(AUV) and/or AUV Calculation Components, such as Net Asset Value (NAV), Dividend
and Capital Gain, in a machine-readable form.
-----------------------------------------------------------------------------------------------------------------
AUV Data Entry Fee - If the AUV is not provided in a machine-readable $1.50 per fund, per occurrence.
form, this fee applies. This is the fee for manually capturing and entering the
AUV per fund, per occurrence.
-----------------------------------------------------------------------------------------------------------------
AUV Calculation Component Data Entry Fee - If the AUV Calculation Components $1.50 per fund, per occurrence.
are not provided in a machine-readable form, this fee applies. This is the fee
for manually capturing and entering the AUV Calculation Components per fund, per
occurrence.
-----------------------------------------------------------------------------------------------------------------
AUV Calculation Fee - This fee applies if XxXxxxxx is required to calculate the $1.00 per fund, per occurrence.
AUV from components provided by GA or GA's designate.
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
5. Reporting Fees
-----------------------------------------------------------------------------------------------------------------
Additional Copies of Policy Owner Reports, as described in Exhibit A. $5.00 per report
-----------------------------------------------------------------------------------------------------------------
Benefit Statement Fee - The Base Administration Fee provides for Quarterly $5.00 per statement
Benefit Statements. This fee applies if GA requires Statements more frequently
than quarterly.
-----------------------------------------------------------------------------------------------------------------
Additional Billing Kit Fee - The Base Administration Fee provides for a Billing $5.00 per Billing Kit
Kit to be produced and mailed on a modal basis with copies going to the Payor
and Servicing Agent. This fee applies if additional copies of the Billing Kit
are required. The Billing Kit consists of a cover letter and a list-xxxx invoice
for premium, loan repayment or loan interest.
-----------------------------------------------------------------------------------------------------------------
The Base Administration Fee provides one printed copy per day of listed daily $5.00 per report
processing reports. Additional copies provided for additional fee, as described
in Exhibit A.
-----------------------------------------------------------------------------------------------------------------
Base Administration Fee provides electronic data feed for periodic insurance $5.00 per printed report.
carrier financial reporting. Printed copies provided for additional fee. $5.00 per additional fee.
Additional electronic feeds provided for an additional fee. Additional CD's $5.00 per additional CD.
provided for an additional fee.
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
6. Fund Trading Fee
-----------------------------------------------------------------------------------------------------------------
The Base Administration Fee provides for an electronic feed of fund trading $2.50 per facsimile.
activity. This fee applies if the trading activity is transmitted manually, such
as via facsimile, in addition to or in place of the electronic feed.
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
7. Data Interface Fees:
-----------------------------------------------------------------------------------------------------------------
The Base Administration Fee provides for the following standard data interfaces
from XxXxxxxx.
Accounting;
Commissions;
Valuation;
Trades;
Reinsurance
In-force Re-projection.
This fee applies to each additional data feed produced by XxXxxxxx. $25 per occurrence.
-----------------------------------------------------------------------------------------------------------------
The Base Administration Fee provides for the following standard data interfaces
from GA to XxXxxxxx:
(i) Pricing (AUV or AUV Calculation Components)
(ii) Underwriting / New Business
(iii) Agent Management File
This fee applies to each additional in-coming data feed processed by XxXxxxxx. $25 per occurrence.
-----------------------------------------------------------------------------------------------------------------
EXHIBIT D - PART III
FEE SCHEDULE
INSURANCE CONTRACT
ADMINISTRATION SERVICES
Supplemental Administration Fees. The Supplemental Administration Fees apply to
services provided outside the Base Administration Services. These fees are
charged in addition to the greater of the Minimum Monthly Fee defined in Exhibit
D - Part I or the Base Administration Fees defined in Exhibit D - Part II.
-------------------------------------------------------------------------------------------------------------------
1. Price Correction Fee
-------------------------------------------------------------------------------------------------------------------
The Base Administration Fee provides for price correction related Undo/Redo Time & Materials
processing once per month for each fund. If a fund has more than one price
correction per month that requires Undo/Redo processing, this work will be
performed on a Time & Materials basis in excess of the Minimum Monthly Charge.
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
2. VPAS(R)Agent Compensation System
-------------------------------------------------------------------------------------------------------------------
For periodic commission payment processing, MSLLC will (i) Compute commission Flat charge: $1,000 per cycle,
payments; (ii) Produce agent level commission statements and reports; (iii) plus $2.00 per agent, per pay
Produce disbursement requests; (iv) Create journal entries. cycle.
-------------------------------------------------------------------------------------------------------------------
Create checks or wire transfers. $2.50 per check or wire transfer.
-------------------------------------------------------------------------------------------------------------------
1099 Preparation- Electronic transmission to GA. No additional charge.
-------------------------------------------------------------------------------------------------------------------
-------------------------------------------------------------------------------------------------------------------
3. Remote Access Subject to Security Authorization
-------------------------------------------------------------------------------------------------------------------
Wide Area Network Access Fee - The Base Administration Fees provide for Wide See Section 4.02 (c) and (d) for
Area Network access from designated GA office(s), providing inquiry, and report reimbursable expenses associated
request capability. with Wide Area Network access.
-------------------------------------------------------------------------------------------------------------------
Internet Access Fee -The Base Administration Fees provide for Internet access See Section 4.02 (d) and (g) for
by GA employees, designated agents/brokers and policy owners, providing policy reimbursable expenses associated
inquiry and report request capability. with Internet access.
-------------------------------------------------------------------------------------------------------------------
EXHIBIT D - PART IV
CONSULTING FEE
SCHEDULE
Hourly Consulting Rates:
-----------------------------------------------
Account Manager $280
-----------------------------------------------
Actuary $280
-----------------------------------------------
-----------------------------------------------
Business Analyst I $170
-----------------------------------------------
Business Analyst II $185
-----------------------------------------------
Business Analyst III $210
-----------------------------------------------
-----------------------------------------------
Consultant I $265
-----------------------------------------------
Consultant II $285
-----------------------------------------------
Consultant III $315
-----------------------------------------------
-----------------------------------------------
Customer Service Representative I $70
-----------------------------------------------
Customer Service Representative II $110
-----------------------------------------------
Customer Service Representative III $125
-----------------------------------------------
Customer Service Representative IV $140
-----------------------------------------------
-----------------------------------------------
Project Manager I $195
-----------------------------------------------
Project Manager II $235
-----------------------------------------------
Project Manager III $280
-----------------------------------------------
-----------------------------------------------
Software Engineer I $155
-----------------------------------------------
Software Engineer II $170
-----------------------------------------------
Software Engineer III $195
-----------------------------------------------
Software Engineer IV $235
-----------------------------------------------
-----------------------------------------------
Technical Writer I $140
-----------------------------------------------
Technical Writer II $170
-----------------------------------------------
EXHIBIT E
PRODUCTS
GA
PPVUL-TIP-NSC
PPVUL-SIP-NSC
SELIC
LCLI
LCL2R
LCL2
EXHIBIT F
SCHEDULE OF AUTHORIZED PERSONNEL
The following individuals are authorized to give instructions or direction to
XxXxxxxx with respect to matters arising in connection with the servicing to be
performed under this Agreement:
Xxxxxxx Xxxxx Xxxxxx
Xxxx Xxx Xxxxxx
Xxxxx Xxxxxx
EXHIBIT G
INSURANCE COVERAGE
XxXxxxxx will maintain the following coverages during the term of this
Agreement:
(a) Worker's Compensation at statutory limits;
(b) Employers Liability, with $500,000 limit of liability;
(c) Commercial General Liability including Products - Completed
Operations coverage with Broad Form Contractual coverage with
the following limits of liability:
(i) with a combined single limit of $1,000,000 for Bodily
Injury and Property Damage;
(ii) $1,000,000 limit of liability for Aggregate
Products - Completed Operations and Property Damages;
and
(iii) $1,000,000 General Aggregate;
(d) Automobile Liability, with a combined single limit of
liability of $1,000,000/accident;
(e) Crime Insurance policy with limits of $5,000,000;
(f) Errors and Omissions policy with limits of $5,000,000;
(g) Umbrella/Excess Liability insurance with a $4,000,000 limit of
liability.
EXHIBIT I
SAMPLE SOFTWARE LICENSE AGREEMENT
THIS SOFTWARE LICENSE AGREEMENT is entered into as of the 12th day of
July, 2001, by and between XxXxxxxx Systems, L.L.C., a Georgia limited liability
corporation (hereinafter referred to as "XxXxxxxx") and General American Life
Insurance Company, a stock company registered under the laws of the State of
Missouri, (hereinafter referred to as "GA").
WHEREAS, XxXxxxxx and GA are parties to that certain Master
Administration Agreement, dated as of July 12, 2001 (the "Master Administration
Agreement"), pursuant to which XxXxxxxx has agreed to perform certain
Administration services specified therein with respect to the Policies (as
defined in the Master Administration Agreement); and
WHEREAS, the parties hereto have entered into a Software Escrow
Agreement of even date herewith (the "Software Escrow Agreement") pursuant to
which XxXxxxxx will deliver to Fort Xxxx Escrow Services, Inc., as the Escrow
Agent, the Software (defined below) which is utilized in the administration of
the Policies; and
WHEREAS, the parties have agreed that, in the event the Software is
delivered by the Escrow Agent to GA upon the occurrence of a Release Event, GA
is to have a license to use the Software solely on the terms and conditions of
this Agreement,
NOW, THEREFORE, for and in consideration of the mutual covenants and
conditions hereinafter set. forth, and other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged, the parties hereto
hereby agree as follows:
SECTION 1 DEFINITIONS.
As used in this Agreement, the following terms shall have the meaning
set forth:
1.01 Escrow Agent. "Escrow Agent" means Fort Xxxx Escrow Services,
Inc., a Georgia corporation.
1.02 License Term. "License Term" means the twenty-four month
period commencing on release of the Deposit Copies pursuant to SECTION 6.2 of
the Software Escrow Agreement, or that date on which the Initial Term of the
Master Administration Agreement was set to expire.
1.03 Policies. "Policies" means, collectively, the insurance
policies included within one of the Products and "Policy" means any one of the
Policies.
1.04 Products. "Products" means the insurance products described in
Exhibit E of the Master Administration Agreement and made a part hereof.
1.05 Software. "Software" means VPAS(R) Life administration system,
a group of computer programs and associated database data dictionaries utilized
by XxXxxxxx in the discharge of XxXxxxxx'x obligations under the Master
Administration Agreement; provided, however, that Software shall not include any
computer software programs which are licensed by XxXxxxxx from third-parties.
SECTION 2 LICENSE.
XxXxxxxx hereby grants to GA a nonexclusive and royalty-free license,
transferable only as specifically permitted pursuant to this Agreement, to use,
during the License Term, the copies of the Software and updates thereto which
are deposited with the Escrow Agent pursuant to the Software Escrow Agreement
(the "Deposit Copies") for the sole and exclusive purpose of performing the
Administration Services with respect to the Policies, subject only to the
restrictions set forth herein. Anything in this Agreement to the contrary
notwithstanding, this License shall become effective and the rights granted to
GA hereunder shall arise if, and only if, the Deposit Copies shall be properly
delivered by the Escrow Agent to GA in accordance with the terms and conditions
of the Software Escrow Agreement.
SECTION 3 NO PAYMENT.
XxXxxxxx acknowledges and agrees that it shall receive no compensation,
royalty, license fee or other payment from GA in connection with the license
granted pursuant to this Agreement.
SECTION 4 LIMITATIONS ON USE.
GA shall use the Software during the License Term solely for the
purpose of performing the Administration Services with respect to the Policies.
In the event that GA, either itself or through its agents or its affiliates or
their agents, shall use the Software for any purpose which is not specifically
permitted by the terms of this Agreement, the License granted hereunder shall be
revoked and shall be of no further force or effect.
SECTION 5 ASSIGNMENT BY GA.
XxXxxxxx acknowledges that, during the License Term, GA may engage
third-parties to perform the administration of the Policies. GA shall have the
right to sublicense the Software to any such third party, during the License
Term, but only of such third-party shall agree in writing, as a condition
precedent to the effectiveness of such assignment, to be bound by all of the
terms and conditions of this Agreement and the Master Insurance Administration
Agreement and such writing shall be delivered to XxXxxxxx.
SECTION 6 NO SUPPORT SERVICES.
GA acknowledges and agrees that XxXxxxxx shall not be required to
perform or provide any installation, maintenance or support services to GA with
respect to the license granted under this Agreement.
SECTION 7 WARRANTY.
XxXxxxxx warrants to GA that the Software will function so as to allow
for the administration of the Policies in substantially the same manner in which
such policies are administered as of the date the Software was deposited with
the Escrow Agent; provided, however, that this warranty shall terminate
immediately in the event GA makes any modification, enhancement or other change
to the Software. EXCEPT AS EXPRESSLY SET FORTH IN THIS SECTION 7, XXXXXXXX MAKES
NO EXPRESS OR IMPLIED WARRANTY WHATSOEVER, WHETHER OF MERCHANTABILITY, OF
FITNESS FOR A PARTICULAR PURPOSE OR OTHERWISE.
SECTION 8 TERMINATION.
In the event GA shall breach or otherwise violate any term or condition
of this Agreement during the License Term, which breach or violation shall not
be cured within ten (10) business days after receipt of written notice of such
breach or violation from XxXxxxxx, XxXxxxxx shall have the right to terminate
this Agreement upon written notice to GA.
SECTION 9 DUTIES UPON TERMINATION.
Upon termination of this Agreement, whether upon the expiration of the
License Term or otherwise, GA shall, within ten (10) business days after the
date of such termination, deliver to XxXxxxxx at GA's sole cost and expense, all
copies of the Software and other items contained in the Deposit Copy and shall
cease all further use of the Software.
SECTION 10 CONFIDENTIALITY.
(a) Without XxXxxxxx'x prior written consent, GA shall not in any
manner or form disclose, provide or otherwise make available, in whole or in
part, the Software, or anything contained in the Deposit Copy, other than (i) to
its employees in the scope of their employment; (ii) to any permitted assignee
under SECTION 5 hereof; and (iii) to GA's independent auditors, legal counsel
and other agents, but in all such cases GA shall use its reasonable efforts to
have each such person, receiving such disclosure, agree, in writing to protect
the confidentiality of the Software and other items contained in the Deposit
Copy. GA shall take all appropriate action to satisfy its obligations under this
Agreement with respect to use and confidentiality of the Software. GA shall not,
without XxXxxxxx'x prior written consent, disclose, transfer or transmit, in
whole or in part in any manner, the Software or my information which can permit
the duplication, recreation or other utilization of any proprietary or
confidential information of XxXxxxxx embodied in the Software or associated
documentation and procedures contained in the Deposit Copy.
(b) GA acknowledges and agrees that a breach or contemplated
breach by GA of this SECTION 10 will result in irreparable injury to XxXxxxxx.
Therefore, in the event of any breach or contemplated breach of this SECTION 10,
in addition to all other remedies provided at law or
in equity, XxXxxxxx shall be entitled to both preliminary and permanent
injunctive relief to prevent a breach or a contemplated breach of this SECTION
10.
SECTION 11 MISCELLANEOUS.
11.1 Binding Effect; Assignment. This Agreement shall be binding
upon and shall inure to the benefit of the parties hereto and their respective
successors and permitted assigns. No party to this Agreement may assign its
rights or delegate its duties hereunder without the prior written consent of the
other party hereto.
11.2 Governing Law. This Agreement will be governed by and
construed in accordance with the laws of the State of Georgia.
11.3 Notices. Any notice or other communication required or
permitted hereunder shall be in writing and shall be delivered personally,
telegraphed, telexed, sent by facsimile transmission or sent by certified,
registered or express mail, postage prepaid and return receipt requested. Any
such notice shall be deemed given when so delivered personally, telegraphed,
telexed or sent by facsimile transmission or, if mailed, three (3) days after
the date of deposit in the United States mail, as follows:
(a) If to GA:
General American Life Insurance Company
000 Xxxxxx Xxxxxx
Xx. Xxxxx, XX 00000
Attention: R Xxxxx Xxxxxx, Assistant Vice President
Facsimile Number. (000) 000-0000
(b) If to XxXxxxxx:
XxXxxxxx Systems, L.L.C.
0000 Xxxxxx Xxxxx Xxxx
Xxxxx Xxxxx
Xxxxxxx, XX 00000
Attention: J. Xxxxxx Xxxxxxx, Jr., Vice Chairman
Facsimile Number. (000) 000-0000
11.4 Severability. In the event that any one or more of the
provisions contained in this Agreement, or in any other document, agreement or
instrument referred to herein, shall, for any reason, be held to be invalid,
illegal or unenforceable in any respect, such invalidity, illegality or
unenforceability shall not affect any other provision of this Agreement or any
other such document, agreement or instrument.
11.5 No Third-Party Beneficiaries. Nothing in this Agreement is
intended or shall be construed to give any person, other than the parties
hereto, any legal or equitable right, remedy or claim under or in respect of
this Agreement or any provision contained herein.
11.6 Effect of Article and Section Headings. The Article and
Section headings herein are for convenience only and shall not affect the
construction of this Agreement.
11.7 Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original but all of which will
constitute one and the same document.
11.8 Entire Agreement. This Agreement, and the agreements
contemplated hereby, contain the entire understanding of the parties with
respect to the subject matter hereof and thereof, and no representation,
warranty, covenant or agreement not embodied herein or therein, or oral or
otherwise, shall be of any force or effect whatsoever. Further, no change,
amendment or modification of this Agreement shall be effective unless in writing
and signed by all of the parties hereto.
11.9 Waiver. A waiver of any default or breach hereunder granted by
any party hereto shall not constitute a waiver by such party of any other
default or breach or a waiver by such party of the same default or breach at a
later time. Further, to be effective, any such waiver must be in writing and be
signed by the party granting such waiver.
IN WITNESS WHEREOF, the parties hereto have caused this License
Agreement to be executed and delivered by their duly authorised officers or
partners (as the case may be), all as of the date first above written.
XxXxxxxx Systems, L.L.C.
By: /s/ J. Xxxxxx Xxxxxxx, Jr.
J. Xxxxxx Xxxxxxx, Jr.
Vice Chairman
General American Life Insurance Company
By: /s/ R. Xxxxx Xxxxxx
R. Xxxxx Xxxxxx
Assistant Vice President
