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EXHIBIT 1-A(8)(C)
FORM OF
ADMINISTRATIVE SERVICES AGREEMENT
ADMINISTRATIVE SERVICES AGREEMENT, dated as of June 16, 1997, by and among
Xxxxxx Investors Life Insurance Company, an Illinois insurance company
(together with its successors and permitted assigns, the "Company"), Bancorp
Services, L.L.C., a Missouri limited liability company (together with its
successors and permitted assigns, the "Administrator"), and Zurich Centre
ReSource Limited, a Delaware corporation (together with its successors and
permitted assigns, "ZCR").
WHEREAS, the Company is the underwriter of the Series I Private Placement
Variable Life Insurance Policies identified in Schedule A and the Series II
- VII Private Placement Variable Life Insurance Policies identified in
Schedule B (such policies hereinafter referred to as the "Policy"),
Schedule A and Schedule B are attached to and form a part of this Agreement
and which may be amended from time to time;
WHEREAS, the Company and the Administrator desire to enter into this
Agreement whereby the Administrator agrees to perform administrative
services in connection with the Policy, as specified herein;
WHEREAS, ZCR, the Company and the Administrator have entered into an
SVP/SCV Technology License Agreement pursuant to which Administrator has
granted certain rights and licenses to ZCR (and ZCR has granted certain
rights and sublicenses to the Company ), and ZCR and the Company have
entered into a Product and Marketing Support Agreement pursuant to which
ZCR has agreed to perform certain services for and license certain
technology to the Company in connection with Series I Private Placement
Variable Life Insurance Policies;
NOW, THEREFORE, in consideration of these premises, the parties hereto mutually
agree as follows:
SECTION 1- RESPONSIBILITY
The Company hereby appoints and designates the Administrator to be the
administrator of the Company's Series I Private Placement Variable Life
Insurance Policies identified in Schedule A and the Series II - VII Private
Placement Variable Life Insurance Policies identified in Schedule B. The
Company and the Administrator may by mutual consent add policies to and
delete polices from Schedule A and Schedule B from time to time.
The Administrator hereby agrees to assume responsibility for the performance of
"administrative services," as hereinafter described.
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SECTION 2 - ADMINISTRATIVE SERVICES
The term "administrative services" as used in this Agreement shall mean the
performance by the Administrator of the following functions:
1. Billing - The Administrator shall prepare all premium statements and
distribute them to the policyholder.
2. Reports - The Administrator shall furnish to the Company premium
reports, including information as to covered employees, additions to and
terminations of coverage, total gross premium billed; full and partial
surrenders, loans, as well as any other information the Company may
reasonably require, including, but not limited to, the timely provision
of information necessary to permit the Company to determine the payments
required to be made pursuant to paragraph 8 of Section 3 hereof. The
Administrator shall furnish to the Company all information and reports
necessary to enable compliance with Internal Revenue Code Section 7702
and Section 7702A and with any other tax reporting obligations the
Company might have. The Company shall have the sole and exclusive right
to interpret the Internal Revenue Code and determine its tax and other
liabilities and responsibilities thereunder.
3. Communications with Policyholders - The Administrator shall prepare
statements for policyholders showing account values and other
transactions, including surrenders. Such statements shall be furnished
annually to each policyholder or more often as such policyholder may
reasonably require. The Administrator shall perform such other services
customarily associated with insurance policy administration, including
processing changes in the amount of insurance, and communication with
the policyholder.
4. Office and Supplies - The Administrator shall maintain, at its own
expense, an office and the Company will provide the necessary supplies
of forms for the administration of the Policy.
5. Reports - Any forms or reports developed by the Administrator for the
administration of the Policy and for distribution to policyholders must
be approved by the Company prior to use.
6. Reserve Calculations - The Administrator shall perform all reserve
calculations in connection with the Policy and shall furnish reserve
information to the Company at such times required by the Company and in
such format agreed to by the Company and the Administrator.
7. Loans and Surrenders - The Administrator shall process all requests for
loans and full and partial surrenders under the Policy.
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SECTION 3 - GENERAL PROVISIONS
1. Standard of Care - The Administrator agrees to perform, in a timely
manner consistent with reasonable industry practice, faithfully and in
accordance with applicable law, the duties as set forth herein. The
Administrator represents that it meets all applicable requirements to
enter into this agreement including any required state licenses and
agrees to take such action as may be required under any applicable law
to perform its obligations under this agreement. In performing the
services set forth herein, the Administrator shall direct its efforts
towards advancing the business and interests of the Company to the best
of its ability.
2. Indemnification - The Administrator agrees to indemnify the Company and
hold the Company harmless from any and all losses, damages, and
expenses, including reasonable legal fees and expenses, which the
Company may incur as a result of or arising out of any acts or
omissions, whether dishonest, fraudulent, criminal or negligent, of the
Administrator or its employees, acting alone or in collusion with
others.
The Company agrees to indemnify the Administrator and hold the
Administrator harmless from any and all losses, damages, and expenses,
including reasonable legal fees and expenses, which the Administrator
may incur as a result of or arising out of any acts or omissions,
whether dishonest, fraudulent, criminal or negligent, of the Company or
its employees, acting alone or in collusion with others.
The Administrator shall maintain in effect an errors and omissions
liability policy in the amount of no less than $1,000,000 per
occurrence, $3,000,000 annual aggregate limit, providing for
indemnification of the Company to cover any loss arising as a result of
any real or alleged dishonest, fraudulent, criminal or negligent
conduct on the part of the Administrator's officers, agents or
employees in any aspect of the performance of the Administrator's
services under this Agreement. The Administrator shall cause the issuer
of said policy to name the Company as a loss payee under such policy
and to deliver to the Company evidence of the existence of such policy.
The Administrator shall also cause the issuer to give 30 days' written
notice prior to the cancellation of or any material change in the
policy.
3. Termination - This Agreement shall become effective as of the date it
has been duly executed by all parties and shall continue in effect
until terminated pursuant to paragraph a or b below.
a. This Agreement may be terminated by the Company or the Administrator
by giving written notice to the other at least ninety days prior to the
termination date, provided that, in the event of a termination by the
Administrator pursuant to this sentence, the Company shall have the
right in its sole discretion to extend the term
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of this Agreement for up to an additional 90 days (i.e., so that this
Agreement would not be terminated on less than 180 days prior written
notice by the Administrator).
b. Notwithstanding any other provision herein to the contrary, this
Agreement may be terminated immediately by the Company for any of the
following reasons:
i. The Administrator fails to perform any of its obligations
under this Agreement which failure to perform shall continue
without cure for not less than 30 days following the
Administrator's receipt of written notice from the Company of the
Administrator's failure to perform; or
ii. The occurrence of an event described in Section 14 of this
Agreement.
Notwithstanding any other provision herein to the contrary, this
Agreement may be terminated by the Administrator if the Company fails
to make a payment required to be made by this Agreement to the
Administrator and such failure has not been cured within 30 days after
notice (specifying that it is a notice of termination being given
pursuant to this Section 3b) has been sent by the Administrator to the
Company, provided that with respect to this paragraph of Section 3b,
written notice is given in the manner provided in Section 20 below,
and, additionally concurrent telephone confirmation of such notice is
given personally directly to any of Xxxxx Xxxxxxx, Xxxxx Xxxxxx or Xxxx
Xxxxxxx.
c. Upon termination of this Agreement for any reason, the Administrator
agrees that for a period of five years from the date of termination,
neither it nor any of its affiliates will take any action designed or
calculated to result in the transfer or exchange of Policies or provide
administrative services or otherwise use or offer its systems for use
in administering policies issued by an insurance Company other than the
Company where the cash values of such policies are the result of
transfers or exchanges from policies administered under this Agreement.
4. Independent Contractor - The execution of this Agreement does not serve
to indicate any relationship of employer and employee between the
Company and the Administrator, and it is understood that the
Administrator is an independent contractor.
5. Delivery to Policyholder - Any policies, certificates, booklets,
termination notices or other written communications delivered by the
Company to the Administrator for delivery to the policyholder, shall be
delivered by the Administrator, at the Company's expense, promptly
after receipt of instructions from the Company to do so.
6. Legal or Administrative Proceedings - If any notice of the commencement
of any legal proceeding involving any policyholder is received by the
Administrator, or
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if it receives any communication from any Insurance Department or other
administrative agency or any other person identifying a complaint by a
policyholder or calling a hearing involving any Company insuring
practice, the Administrator shall immediately thereafter forward any
correspondence or necessary files to the Company's Home Office for
handling by the Company.
7. Records - The Administrator shall hold and possess, as the property of
the Company, all papers, books, files, correspondence, and records of
all kinds which at any time shall come into its possession or under its
control relating to transactions by or for the Company. Such records
will be maintained during the duration of this Agreement and six years
thereafter.
Upon termination of this Agreement or upon prior request, the
Administrator shall surrender this property to the Company or its
designee provided the Company is the underwriter on such date. If this
Agreement is terminated because the Company is replaced as the
underwriter with respect to all Policies, then all such property
(except that relating to the payment of claims which shall remain the
property of the Company) shall inure to the new underwriter at no
charge by the Company; however, the Company will have access to such
property to the extent needed to fulfill its contractual obligations
and any other legal obligations which may arise.
Notwithstanding the foregoing, the Administrator shall have the right
to retain copies of all papers, books, files, correspondence and
records of all kinds relating to this Agreement upon termination of
this Agreement for any reason.
8. Compensation - The Company will pay the Administrator the fees set out
in Schedule C. The Company and the Administrator may by mutual consent
add, delete, or change the fees shown in Schedule C from time to time.
This compensation will be payable only on those Policies for which
Administrator provides administrative services and only for so long as
those services are provided in accordance with this Agreement. The
provisions contained in this paragraph shall survive termination of
this Agreement.
9. Policy Amendment - The Administrator shall have no authority to alter
or amend the Policy, or to modify, waive or extend any of its
provisions.
10. Advertising, Etc. - It is expressly agreed that the Administrator
shall have no authority to prepare or distribute any advertising,
promotional or descriptive material relating to the Policy without
first obtaining the Company's written approval of same. The
Administrator shall not use the Company name, trademarks, logo or the
name of the affiliated company in any way or manner not specifically
authorized in writing by the Company.
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11. Furnishing Information: Audit, Etc.
a. The Administrator shall furnish the Company and ZCR with all
reasonably requested information regarding any and all matters or
transactions or activities pertaining to the Policy. The Administrator
shall furnish such information, including information required for
financial reporting purposes, at such times required by the Company and
ZCR, as the case may be, and in a format mutually agreed upon. The
Company and ZCR shall have the right to inspect any documents, books
and records of the Administrator pertaining to the Policy or any
activities of the Administrator in connection therewith. Any right on
the part of the Company and ZCR to have access to the offices of the
Administrator or to inspect, audit or photocopy any of the
Administrator's documents, books or records shall be subject to
reasonable advance notice, shall be conducted during the
Administrator's normal business hours in a manner which will not
unreasonably interfere with the Administrator's conduct of its business
and shall be conducted at the sole expense of the Company or ZCR, as
the case may be.
b. The Administrator shall provide access and cooperation to duly
authorized representatives of ZCR and the Company and Insurance
Department representatives (and representatives of other regulatory
authorities), for the purpose of conducting examinations or audits of
its books and accounts, and the Administrator shall make full
disclosure, without reservation of any kind, necessary to enable ZCR
and the Company to determine fully whether the Administrator is
faithfully performing its obligations under this Agreement. Any right
on the part of ZCR and the Company to have access to the offices of
the Administrator or to inspect, audit or photocopy any of the
Administrator's books or records shall be subject to reasonable advance
notice, shall be conducted during the Administrator's normal business
hours in a manner which will not unreasonably interfere with the
Administrator's conduct of its business and shall be conducted at the
sole expense of ZCR or the Company, as the case may be.
c. Each of the Company and ZCR shall have the right to conduct periodic
audits at ZCR's or the Company's office, as the case may be, or at the
office of the Administrator. If ZCR or the Company chooses to conduct
an audit at its own offices, the Administrator shall immediately ship
copies of all requested records to the designated Company or ZCR office
at the sole expense of the Company or ZCR, as the case may be. Any
right on the part of ZCR and the Company to conduct periodic audits at
the offices of the Administrator shall be subject to reasonable
advance notice, shall be conducted during the Administrator's normal
business hours in a manner which will not unreasonably interfere with
the Administrator's conduct of its business and shall be conducted at
the sole expense of ZCR or the Company, as the case may be.
12. Assignment - The Administrator shall not assign or subcontract any of
its administrative functions, duties, or responsibilities without the
prior written
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approval of the Company. The Company shall have the right to refuse
approval for any reason whatsoever at its sole discretion.
13. No Other Agreements - The Administrator shall have no authority to
make any agreement binding upon the Company, except as otherwise
provided in this Agreement, with respect to the Policy or premiums
payable thereon unless previously agreed upon in advance and in
writing between the Administrator and the Company.
14. Insolvency, Etc. - In the event the Administrator shall become
insolvent, make a general assignment for the benefit of creditors, or
if any proceeding of any nature under the Federal Bankruptcy Act, as
amended, or under any state insolvency statute, be commenced by or
against the Administrator (or one of its joint ventures) or if a
receiver be appointed therefore, and such proceeding remains in effect
and unstayed for a period of not less than 90 days, the Administrator
shall immediately notify the Company and ZCR pursuant to Section 20
hereof, and upon the request of the Company:
a. cease and desist all administrative services provided for herein;
b. promptly relinquish and turn over to the Company all records as may
be required or requested by the Company; and,
c. provide to the Company whatever additional information or assistance
may be required or requested by the Company.
15. Arbitration; Submission to Jurisdiction - Any dispute arising out of
or relating to this Agreement or the breach, termination or validity
hereof shall be settled by arbitration before one arbitrator in
Chicago, Illinois in accordance with the commercial arbitration rules
then in effect of the American Arbitration Association. The parties
hereby consent and submit to the personal jurisdiction of any federal
court sitting in Chicago, Illinois and of any Illinois State court of
competent jurisdiction sitting in Chicago, Illinois in any suit,
action or proceeding in connection with arbitration arising out of or
relating to this Agreement. The award entered by the arbitrator shall
be final and binding on all parties to arbitration. Each party shall
bear its respective arbitration expenses and shall each pay its pro
rata portion based on the number of parties participating in such
arbitration of the arbitrator's charges and expenses. The arbitrator
shall not award punitive, exemplary or consequential damages.
Notwithstanding the foregoing, this agreement to arbitrate shall not
bar any party hereto from seeking temporary or provisional remedies
in any court having jurisdiction thereof.
16. Headings - The headings and captions in this Agreement are inserted
for convenience only and shall not be considered in the construction
of any provisions.
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17. Entire Contract - This Agreement constitutes the entire contract
between the parties hereto. Any amendment or modification of this
Agreement, including any Schedule hereto, will not be effective unless
made in writing and signed by the parties hereto.
18. Governing Law - This Agreement shall be construed and enforced
according to the laws of the State of Illinois.
19. Miscellaneous - This Agreement shall be binding upon the Company and
the Administrator, and inure to the benefit of the parties hereto and
their respective successors and permitted assigns. This Agreement may
be executed simultaneously in two or more counterparts, each of which
shall be deemed an original, but all of which together shall constitute
one and the same instrument. No failure or delay in exercising any
right, power or privilege hereunder will operate as a waiver thereof,
nor will any single or partial exercise thereof preclude any other
further exercise thereof or the exercise of any right, power or
privilege hereunder.
20. Notices - All notices and other communications hereunder shall be in
writing and shall be sent by registered or certified mail, return
receipt requested, posted prepaid, by hand delivery or by telecopier,
as follows:
If to Company: Xxxxxx Investors Life Insurance Company
0 Xxxxxx Xxxxx
Xxxx Xxxxx, XX 00000
Attention: General Counsel
Telecopier No: 847.550.5535
with a copy to: Zurich Centre Resource Limited
Xxx Xxxxx Xxxxxxxxx Xxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Xxxx Xxxxx
Telecopier No.: 212.898.8766
and with a copy to: Zurich Centre Resource Limited
Xxx Xxxxx Xxxxxxxxx Xxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: General Counsel
Telecopier No.: 212.898.5444
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If to ZCR: Zurich Centre ReSource Limited
Xxx Xxxxx Xxxxxxxxx Xxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Xxxx Xxxxx
Telecopier No.: 212.898.8766
with a copy to: Zurich Centre ReSource Limited
Xxx Xxxxx Xxxxxxxxx Xxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: General Counsel
Telecopier No.: 212.898.5444
If to Administrator: Bancorp Services, L.L.C.
0000 Xxx Xxxxx Xxxx, Xxxxx 000
Xx. Xxxxx, XX 00000
Attention: Xxxx Xxxxxx
Telecopier No.: 314.984.0025
with copies to: Xxxxx Xxxx LLP
Xxx Xxxxxxxxxxxx Xxxxxx, Xxxxx 0000
Xx. Xxxxx, XX 00000-0000
Attention: Xxxxxxx Xxxxxxxx
Telecopier No: 314.259.2020
and
Zurich Centre ReSource Limited
Xxx Xxxxx Xxxxxxxxx Xxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: Xxxx Xxxxx
Telecopier No.: 212.898.8766
and
Zurich Centre ReSource Limited
One Chase Xxxxxxxxx Xxxxx, 00xx Xxxxx
Xxx Xxxx, XX 00000
Attention: General Counsel
Telecopier No.: 212.898.5444
or to such other person or address as any party shall specify by like notice to
each of the other parties. All such notices and communications shall be deemed
to have been duly given or made (i) when delivered by hand, (ii) when mailed,
five business days after
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being deposited in the mail, postage prepaid and (iii) when telecopied, receipt
acknowledged.
IN WITNESS WHEREOF, this Agreement has been duly executed by an authorized
representative of each of the parties hereto.
BANCORP SERVICES, L.L.C. XXXXXX INVESTORS LIFE
INSURANCE COMPANY
By: /s/ Xxxxx Xxxxxxx By: /s/ Xxxx Xxxxxxx
---------------------------- ----------------------------
Name: Xxxxx Xxxxxxx Name: Xxxx Xxxxxxx
Title: EVP Title: EVP
ZURICH CENTRE RESOURCE LIMITED
By: /s/ Xxxx X. Xxxxx
----------------------------
Name: XXXX X. XXXXX
Title: MANAGING DIRECTOR
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SCHEDULE A
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SERIES I VARIABLE LIFE INSURANCE POLICIES
Policy Owner Date of Issue
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"Star Banc Corporation Rabbi Trust, First Union June 17, 1997
National Bank, Trustee, dated 10-27-95 and as
Amended and restated 6-16-97"
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SCHEDULE B
SERIES II-VII PRIVATE PLACEMENT VARIABLE LIFE INSURANCE POLICES
Series II Private Placement Single Life Variable Life
Insurance Policy Form S-7004
Series III Private Placement Single Life Variable Life
Insurance Policy Form S-7004
Series IV Private Placement Survivorship Variable Life
Insurance Policy Form S-7006
Series V Private Placement Survivorship Variable Life
Insurance Policy Form S-7005
Series VI Private Placement Survivorship Variable Life
Insurance Policy Form S-7005
Series VII Private Placement Survivorship Variable Life
Insurance Policy Form S-7007
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SCHEDULE C
SERIES I PRIVATE PLACEMENT VARIABLE LIFE INSURANCE POLICIES
The Company will pay the Administrator for product administration on Series I
Private Placement Variable Life Insurance Policies $2.50 per month per insured
($30.00 per annum per insured). The fees are payable in arrears on a monthly
basis on the sixth Business Day of each calendar month (the "Payment Date") and
on the termination of this Agreement and are based on the number of insureds as
of the last Business Day of the calendar month immediately preceding such
Payment Date. "Business Day", for purposes of this Schedule C, means each day
that the New York Stock Exchange is open for trading.
SERIES II-VII PRIVATE PLACEMENT VARIABLE LIFE INSURANCE POLICIES
For each Series II - VII Private Placement Variable Life Insurance Policy, the
Administrator shall earn a fee for product administration equal to $12.50 per
month per policy. For each such policy, such fee shall be payable on the Payment
Date in the first full calendar month immediately following the date such policy
was issued, on the Payment Date for such calendar month in each calendar year
thereafter, and on the termination of this Agreement.
For each policy that terminates during the term of this Agreement for any reason
other than the death of the insured(s), the Administrator shall refund to the
Company a portion of the fee paid with respect to such policy on the most recent
Payment Date for such policy. Such portion shall be equal to the product of (i)
the amount of the fee paid with respect to such policy on the most recent
Payment Date for such policy and (ii) the quotient of (x) the number of calendar
days that remain until, but not including, the next Payment Date for such policy
and (y) 365. Such refund may be offset against any payment payable by the
Company to the Administrator hereunder or paid promptly following the
termination of such policy.
Upon the termination of this Agreement, for each policy, the Administrator shall
refund to the Company a portion of the fee paid with respect to such policy on
the most recent Payment Date for such policy. Such portion shall be equal to the
product of (i) the amount of such fee paid with respect to such policy on the
most recent Payment Date for such policy and (ii) the quotient of (x) the number
of calendar days that remain until, but not including, the next Payment Date for
such policy and (y) 365. Such refund shall be paid by the Administrator within
ten Business Days following the termination of this Agreement.
The provisions of this Schedule shall survive the termination of this Agreement.
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