SERVICES AGREEMENT
This Services Agreement (this "Agreement") is made effective as of
November 8, 1996 ("Effective Date"), by and between Directed Services, Inc.
("Company") and First Golden American Life Insurance Company of New York
("Provider").
WHEREAS, Provider has extensive experience in life insurance business
operations; and
WHEREAS, Company desires Provider to perform certain administrative and
special services (collectively, "services") for Company in its insurance
operations and desires further to make use in its day-to-day operations of
certain property, equipment and facilities (collectively, "facilities") of
Provider as Company may request; and
WHEREAS, Provider and Company contemplate that such an arrangement will
achieve certain operating economies and improve services to the mutual benefit
of both; and
WHEREAS, Provider and Company wish to assure that all charges for
services and the use of facilities incurred hereunder are reasonable and in
accordance with the requirements of New York Insurance Department; and
WHEREAS, Provider and Company wish to identify the services to be
rendered to Company by Provider and the facilities to be used by Company and
to provide a method of fixing bases for determining the charges to be made to
Company;
NOW, THEREFORE, in consideration of the premises and of the mutual
promises set forth herein, and intending to be legally bound hereby, Provider
and Company agree as follows:
1. PERFORMANCE OF SERVICES AND USE OF FACILITIES. Subject to the terms,
conditions and limitations of this Agreement, Provider agrees to the
extent requested by Company to perform diligently and in a professional
manner such services for Company as Company determines to be reasonably
necessary in the conduct of its insurance operations and as set forth in
Section 2 of this Agreement.
Subject to the terms, conditions and limitations of this Agreement,
Provider agrees to the extent requested by Company to make available to
Company such of its facilities as Company may determine to be reasonably
necessary in the conduct of its insurance operations, including data
processing equipment, business property (whether owned or leased) and
communications equipment.
Provider agrees at all times to maintain sufficient facilities and
trained personnel of the kind necessary to perform this Agreement.
(a) CAPACITY OF PERSONNEL AND STATUS OF FACILITIES. Whenever
Provider utilizes its personnel to perform services for Company
pursuant to this Agreement, such personnel shall at all times remain
employees of Provider subject solely to its direction and control,
and Provider shall alone retain full liability to such employees for
their welfare, salaries, fringe benefits, legally required employer
contributions and tax obligations.
No facility of Provider used in performing services for or
subject to use by Company shall be deemed to be transferred,
assigned, conveyed or leased by performance or use pursuant to this
Agreement.
(b) EXERCISE OF JUDGEMENT IN RENDERING SERVICES. In providing any
services hereunder which require the exercise of judgment by
Provider, Provider shall perform any such service in accordance with
any standards and guidelines Company develops and communicates to
Provider. In performing any services hereunder, Provider shall at
all times act in a manner reasonably calculated to be in or not
opposed to the best interests of Company.
(c) CONTROL. The performance of services by Provider for Company
pursuant to this Agreement shall in no way impair the absolute
control of the business and operations of Provider or Company by
their respective Boards of Directors. Provider shall act hereunder
so as to assure the separate operating identity of Company.
(d) USE OF DATA PROCESSING FACILITIES. Subject to the terms
(including any limitations and restrictions) of any applicable
software or hardware licensing agreement then in effect between
Provider and any licensor, Provider shall, upon termination of this
Agreement, grant to Company a perpetual license, with payment of a
reasonable fee, in any electronic data processing software developed
or used by Provider in connection with the services provided to
Company hereunder if such software is not commercially available and
is necessary, in Company's reasonable judgment, for Company to
perform subsequent to termination the functions provided by Provider
hereunder.
2. SERVICES. The performance of Provider under this Agreement with respect
to the business and operations of Company shall at all times be subject
to the direction and control of the Board of Directors of Company.
Subject to the foregoing and to the terms, conditions and limitations of
this Agreement, Provider shall provide to Company the services set forth
below.
(a) RECORDKEEPING. Provider shall maintain detailed
contract/customer level records tracking the units of each series in
the GCG Trust that are purchased by the Separate Accounts of
Provider. Provider shall also keep address and ownership records
for these units to enable the Company to satisfy its regulatory and
contractual obligations.
(b) DISASTER RECOVERY PROGRAM. Provider agrees to maintain back-up
systems and contingency plans to assure that any work stoppages,
interruptions, or other failures resulting from any types of
disaster will not jeopardize the integrity of data or records
maintained by Provider under this Agreement on behalf of the
Company. Provider warrants that it will maintain such systems and
plans in conformity with prudent business practices.
3. CHARGES. Company agrees to reimburse Provider for services and
facilities provided by Provider to Company pursuant to this Agreement.
The charge to Company for such services and facilities shall include all
direct and directly allocable expenses, reasonably and equitably
determined to be attributable to Company by Provider, plus a reasonable
charge for direct overhead, the amount of such charge for overhead to be
agreed upon by the parties from time to time.
4. PAYMENT. Provider shall submit to Company within thirty (30) days of the
end of each calendar month a written statement of the amount estimated to
be owed by Company for services and the use of facilities pursuant to
this Agreement in that calendar month, and Company shall pay to Provider
within thirty (30) days following receipt of such written statement the
amount set forth in the statement.
Within thirty (30) days after the end of each calendar quarter, Provider
will submit to Company a detailed written statement of the charges due
from Company to Provider in the preceding calendar quarter, including
charges not included in any previous statements, and any balance payable
or to be refunded as shown in such statement shall be paid or refunded
within fifteen (15) days following receipt of such written statement by
Company.
5. ACCOUNTING RECORDS AND DOCUMENTS. Provider shall be responsible for
maintaining full and accurate accounts and records of all services
rendered and facilities used pursuant to this Agreement and such
additional information as Company may reasonably request for purposes of
its internal bookkeeping and accounting operations. Provider shall keep
such accounts and records insofar as they pertain to the computation of
charges hereunder available at its principal offices for audit,
inspection and copying by Company and persons authorized by it or any
governmental agency having jurisdiction over Company during all
reasonable business hours.
With respect to accounting and statistical records prepared by Provider
by reason of its performance under this Agreement, such records shall be
delivered to Company within thirty (30) days from the end of the month to
which the records pertain.
6. OTHER RECORDS AND DOCUMENTS. All books, records, and files established
and maintained by Provider by reason of its performance under this
Agreement which, absent this Agreement, would have been held by Company,
shall be deemed the property of Company, and shall be subject to
examination at all times by Company and persons authorized by it or any
governmental agency having jurisdiction over Company, and shall be
delivered to Company at least quarterly.
With respect to original documents other than those provided for in
Section 5 hereof which would otherwise be held by Company and which may
be obtained by Provider in performing under this Agreement. Provider
shall deliver such documents to Company within thirty (30) days of their
receipt by Provider except where continued custody of such original
documents is necessary to perform hereunder.
7. RIGHT TO CONTRACT WITH THIRD PARTIES. Nothing herein shall be deemed to
grant Provider an exclusive right to provide services to Company, and
Company retains the right to contract with any third party, affiliated or
unaffiliated, for the performance of services or for the use of
facilities as are available to or have been requested by Company pursuant
to this Agreement.
8. CONTACT PERSON(S). Company and Provider each shall appoint one or more
individuals who shall serve as contact person(s) for the purpose of
carrying out this Agreement. Such contact person(s) shall be authorized
to act on behalf of their respective parties as to the matters pertaining
to this Agreement. Effective upon execution of this Agreement, the
initial contact person(s) shall be those set forth in Appendix A. Each
party shall notify the other, in writing, as to the name, address and
telephone number of any replacement for any such designated contact
person.
9. TERMINATION AND MODIFICATION. This Agreement shall remain in effect
until terminated by either Provider or Company upon giving thirty (30)
days or more advance written notice, provided that Company shall have the
right to elect to continue to receive data processing services and/or to
continue to utilize data processing facilities and related software for
up to one year from the date of such notice. Upon termination, Provider
shall promptly deliver to Company all books and records that are, or are
deemed by this Agreement to be, the property of Company.
10. SETTLEMENT ON TERMINATION. No later than ninety (90) days after the
effective date of Complete Termination of this Agreement, Provider shall
deliver to Company a detailed written statement for all charges incurred
and not included in any previous statement to the effective date of
termination. The amount owed or to be refunded hereunder shall be due
and payable within thirty (30) days of receipt of such statement.
11. ASSIGNMENT. This Agreement and any rights pursuant hereto shall not be
assignable by either party hereto, except as set forth herein or by
operation of law. Except as and to the extent specifically provided in
this Agreement, nothing in this Agreement, expressed or implied, is
intended to confer on any person other than the parties hereto, or their
respective legal successors, any rights, remedies, obligations or
liabilities, or to relieve any person other than the parties hereto, or
their respective legal successors, from any obligations or liabilities
that would otherwise be applicable. The representations, warranties,
covenants and agreements contained in this Agreement shall be binding
upon, extend to and inure to the benefit of the parties hereto, their,
and each of their, successors and assigns respectively.
12. GOVERNING LAW. This Agreement shall be governed by and construed and
enforced in accordance with the internal laws of the State of New York
applicable to contracts made and to be performed in that State, without
regard to principles of conflict of laws.
13. ARBITRATION. In the event of any irreconcilable dispute between the
parties in connection with this Agreement, the dispute shall be submitted
to arbitration. Either party may submit the dispute to arbitration by
notifying the other of its submission and naming its arbitrator. The
other party shall name its arbitrator within 30 days after receiving such
notice. If the arbitrators cannot agree, they shall choose an umpire
through the nomination of three persons by each arbitrator, the
declination by each arbitrator of two of the nominees named by the other
arbitrator and the drawing of lots to choose between the two arbitrators
within thirty days after the arbitrators and umpire, if any, are chosen.
The arbitrators and umpire shall be disinterested insurance company
executives. The arbitrators are relieved from judicial formalities and
may refrain from following strict rules of evidence. The decisions of
the arbitrators and umpire, or the majority of them, shall be final and
binding upon the parties. Each party shall bear the expense of its own
arbitrator and one-half the other expenses of the arbitration
proceedings. Any arbitration shall take place in New York, New York,
unless otherwise mutually agreed.
14. NOTICE. All notices, statements or requests provided for hereunder shall
be deemed to have been duly given when delivered by hand to an officer of
the other party, or when deposited with the U.S. Postal Service, as first
class certified or registered mail, postage prepaid, overnight courier
service, telex or telecopier, addressed:
(a) if to Provider:
Xxxx Xxx Xxxxxxxxx
First Golden American Life Insurance
Company of New York
0000 Xxxxxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxxxx, Xxxxxxxx 00000
(b) if to Company:
Xxxxx X. Xxxxxxx
Directed Services, Inc.
0000 Xxxxxxxxx Xxxxxx, Xxxxx 000
Xxxxxxxxxx, Xxxxxxxx 00000
or to such other persons or places as each party may from time to time
designate by written notice sent as aforesaid.
15. ENTIRE AGREEMENT. This Agreement, together with such amendments as may
from time to time be executed in writing by the parties, constitutes the
entire Agreement and understanding between the parties in respect of the
transactions contemplated hereby and supersedes all prior agreements,
arrangements and understandings relating to the subject matter hereof.
Any amendments to this Agreement are subject to prior approval by the
Superintendent, State of New York, Department of Insurance.
16. SECTION HEADINGS. Section headings contained herein are for reference
purposes only and shall not affect the meaning or interpretation of this
Agreement.
17. COUNTERPARTS. This Agreement may be executed in separate counterparts,
each of which shall be deemed an original, but all of which together
shall constitute one and the same instrument.
18. ADDITIONAL PROVISIONS. Appendix A, attached hereto, is hereby
incorporated into and made a part of this Agreement.
IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
in duplicate by their respective officers duly authorized so to do, and their
respective corporate seals to be affixed hereto, as of the date and year first
above written.
DIRECTED SERVICES, INC.
/s/ Xxxx Xxx Xxxxxxxxx
----------------------------------------
Xxxx Xxx Xxxxxxxxx, President (Seal)
Attest: /s/ Xxxxx X. Xxxxxxx
----------------------------------------
Xxxxx X. Xxxxxxx, Secretary
FIRST GOLDEN AMERICAN LIFE INSURANCE COMPANY OF NEW YORK
/s/ Xxxxx X. Xxxxxxx
----------------------------------------
Xxxxx X. Xxxxxxx, President (Seal)
Attest: /s/ Xxxxx X. Xxxxxxx
----------------------------------------
Xxxxx X. Xxxxxxx, Secretary
APPENDIX A
CONTACT PERSON(S) FOR PROVIDER
Xxxx Xxx Xxxxxxxxx
CONTACT PERSON(S) FOR COMPANY
Xxxxx X. Xxxxxxx
