WORK ASSIGNMENT
This Work Assignment (this "WORK ASSIGNMENT" or "ASSIGNMENT") is made
this 30th day of December, 2005, by and between Security Benefit Life Insurance
Company, a Kansas stock insurance company ("ADMINISTRATOR"), Security
Distributors, Inc., a Kansas corporation ("SDI"), and Allmerica Financial Life
and Annuity Company, a Massachusetts stock insurance company ("CLIENT").
WITNESSETH:
WHEREAS, ADMINISTRATOR, SDI and The ▇▇▇▇▇▇▇ ▇▇▇▇▇ Group, Inc., a Delaware
corporation ("GS GROUP") are party to that certain Third Party Administrator
Agreement by and among them dated August 22, 2005 (the "MASTER AGREEMENT"),
setting forth general terms and conditions for Work Assignments for CLIENTS (as
defined therein), subject to such different and additional terms and conditions
as may be set forth in such Work Assignments;
WHEREAS, CLIENT has become an Affiliate, as defined in the Master
Agreement, of GS GROUP by virtue of the acquisition on December 30, 2005 by GS
GROUP of CLIENT from THE HANOVER INSURANCE GROUP, INC. (formerly Allmerica
Financial Corporation) ("AFC") and desires to engage ADMINISTRATOR and SDI to
perform the Transition Services, Administration Services, and Brokerage Services
(as hereinafter delineated) for it with respect to the Contracts (as hereinafter
described) on the terms and conditions hereof, as supplemented by the general
terms and conditions of the Master Agreement;
WHEREAS, pursuant to a Transition Planning Agreement dated September
8, 2005 (the "TRANSITION PLANNING AGREEMENT") among ADMINISTRATOR, SDI and GS
GROUP, ADMINISTRATOR has delivered to GS GROUP a Transition Plan (as defined in
the Transition Planning Agreement), a copy of which is attached hereto as
EXHIBIT 1, relating to the requirements for transitioning the administration of
the Contracts to ADMINISTRATOR and SDI following the completion of the
acquisition of CLIENT by GS GROUP; and
WHEREAS, pursuant to an Interim Transition Services Agreement dated
December 5, 2005 (the "INTERIM TRANSITION SERVICES AGREEMENT") among
ADMINISTRATOR, SDI, GS GROUP, AFC, CLIENT, and First Allmerica Financial Life
Insurance Company ("FAFLIC"), ADMINISTRATOR and SDI commenced to furnish and
have furnished the initial Transition Services as contemplated thereby;
WHEREAS, ADMINISTRATOR and SDI desire to provide such Transition
Services, Administration Services, and Brokerage Services to CLIENT with respect
to the Contracts on the terms and conditions hereof, as supplemented by the
general terms and conditions of the Master Agreement;
NOW THEREFORE, for and in consideration of the foregoing premises and the
mutual undertakings, agreements and covenants set forth herein and in the Master
Agreement, and for other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto do hereby agree
as follows:
I. DEFINITIONS
Capitalized terms used but not defined in this Assignment shall have the
meanings assigned to them in the Master Agreement.
II. SCOPE OF ASSIGNMENT
A. CONTRACTS
The Contracts are annuity contracts and variable universal life
insurance policies insured, coinsured, or reinsured by CLIENT. All are
currently administered by CLIENT. SCHEDULE A contains a substantially
complete list of the Contracts covered hereby. The Parties all
acknowledge that the number of each type of Contract, being as of a date
in the past (January 2004), is approximate.
B. TERMINATED CONTRACTS, LAPSES AND REINSTATEMENTS
Unless otherwise agreed by ADMINISTRATOR and CLIENT in writing, if
the transition for a Product (see THIRD COLUMN in SCHEDULE A) occurs on
or before June 30th of a calendar year, only Contracts of such
Product-type that are active or were terminated during such calendar year
or the preceding calendar year shall be transitioned (I.E., shall be
"CONTRACTS"). If the transition for a Product occurs on or after July 1st
of a calendar year, only Contracts of such Product-type that are active
or were terminated during such calendar year shall be transitioned (I.E.,
shall be "CONTRACTS"). Lapsed Contracts shall be transitioned (I,E.,
shall be "CONTRACTS") if but only if within the period allowed for
reinstatement.
Unless otherwise agreed by ADMINISTRATOR and CLIENT in writing,
Point-in Time shall be as of December 31, 2004.
III. THE SERVICES
A. TRANSITION SERVICES
ADMINISTRATOR and SDI shall implement, in conjunction with CLIENT,
AFC, and FAFLIC, the Transition Plan. ADMINISTRATOR and SDI shall provide
overall management and leadership with respect to the implementation of
the Transition Plan. SCHEDULE B describes with more particularity the
components of the transition services to be furnished by ADMINISTRATOR
and SDI the "TRANSITION SERVICES").
2
B. ADMINISTRATION SERVICES
SCHEDULE C sets forth the Services relating to the Contracts to be
provided hereunder on an ongoing basis (the "ADMINISTRATION SERVICES").
ADMINISTRATOR shall maintain policies and procedures in respect of its
provision of the Administration Services.
IV. BROKERAGE SERVICES
SDI shall perform the brokerage services set forth on SCHEDULE D
(the "BROKERAGE SERVICES") with respect to administration of the
Contracts following transition of the Contracts to ADMINISTRATOR and SDI.
SDI shall maintain policies and procedures in respect of its provision of
the Brokerage Services.
V. SCHEDULE
ADMINISTRATOR and SDI shall continue, from and after the date
hereof, to perform the Transition Services as contemplated in the
Transition Plan. ADMINISTRATOR and SDI shall use diligent efforts to
complete the Transition Services within 12 months following the date
hereof. In the event that Transition Services are not completed within
such period, CLIENT shall be entitled to a rebate of the fees due for
such Services in the amount of $100,000 for every full calendar month of
lateness; provided that no such rebate shall be due in respect of any
calendar month of lateness to the extent that such lateness is not caused
by or the fault of ADMINISTRATOR or SDI.
VI. STAFFING
ADMINISTRATOR, SDI and CLIENT shall each devote, or cause to be
devoted in the case of third party staff (including AFC and FAFLIC as
applicable), Qualified business and technical staff as is reasonably
necessary to complete the transition of the administration of the
Contracts as contemplated herein (as supplemented by the Master
Agreement) to ADMINISTRATOR and SDI.
During each Conversion Track (see Schedule B, Item 2), CLIENT
shall provide experienced and knowledgeable resources (including those of
AFC and FAFLIC as applicable) capable of supplying the following to
assist ADMINISTRATOR and SDI perform their Transition Service
responsibilities:
- provide resources capable of validating product
specifications and setup;
- provide information technology resources capable of
identifying sources of data and providing the
required data in electronic media format;
3
- provide experienced resources capable of operating
and maintaining the current CLIENT, AFC, and FAFLIC
software policy administration systems;
- provide actuarial resources capable of testing and
certifying values being generated by the
ADMINISTRATOR and SDI system; and
- provide data in electronic media format to assist
with the automated financial reconciliation process.
The staffing required of each party will be addressed in more
detail by the parties as the transition process proceeds. In any event,
each party recognizes that circumstance unforeseen in connection with the
development of the Transition Plan may require it to devote additional or
fewer staff than anticipated.
VII. ACCESS
ADMINISTRATOR and SDI anticipate the need to perform at least
certain Transition Services on site at CLIENT's, AFC's, and/or FAFLIC's
facilities and to have reasonable access to appropriate space thereat and
to the equipment and systems utilized by CLIENT, AFC, and/or FAFLIC to
administer the Contracts as well as the personnel of CLIENT, AFC, and/or
FAFLIC (or their contractors) who perform such services with respect to
the Contracts, free of rent or other charges. CLIENT accordingly agrees
to provide such access and to cause AFC and FAFLIC to provide
ADMINISTRATOR and SDI access to appropriate space at CLIENT's, AFC's, and
FAFLIC's facilities and to their respective equipment, systems and
personnel (including contract personnel), during their normal business
hours (rent and otherwise charge free) as reasonably needed by
ADMINISTRATOR and SDI to perform the Transition Services, including
arranging or procuring for the benefit of ADMINISTRATOR and/or SDI, at
CLIENT's expense, for ADMINISTRATOR and/or SDI to have the right to
access and use third party software utilized by CLIENT, AFC, and/or
FAFLIC with respect to administration of the Contracts as reasonably
necessary for ADMINISTRATOR and SDI to perform the Transition Services;
provided that such access to third party software need not include source
code access in violation of CLIENT's, AFC's, or FAFLIC's existing license
agreements.
VII. SERVICE LEVEL AGREEMENTS
The Service Level Agreements governing performance of the Services
hereunder, and standards for "significant and chronic" performance
failures, are set forth in SCHEDULE E.
4
IX. FEES FOR SERVICES
A. TRANSITION SERVICE FEES
1. BASE FEE.
$4,905,000, comprising the amounts set forth below in this Part
IX. A.1:
ADMINISTRATOR may and shall invoice for such fees at or about (but
not before) the following times in the following amounts:
Monthly (for nine months) $ 350,000
Completion of VA I Transition $ 500,000
Completion of VA II Transition $ 750,000
Completion of VUL Transition $ 505,000
Monthly invoices will be sent at or about the beginning of the
months to which they relate. Payment of monthly invoices is due within 30
days of receipt of the invoice. Payment of invoices for other amounts
listed above is due within 15 days of CLIENT's receipt of the invoice.
Amounts not paid when due shall be subject to a late charge of one and
one half percent (1.5%) per month or the applicable legal maximum rate of
interest, whichever is less.
2. POTENTIAL BONUS.
ADMINISTRATOR shall be entitled to a bonus of $515,000 in the
event that it has satisfactorily completed all three Conversion Tracks
within 9 months from the date hereof, subject to reduction pursuant to
Part IX. A.4.
3. DELAYS.
If completion of one or more Conversion Tracks requires a tenth
month of Transition Services, ADMINISTRATOR shall be permitted to invoice
up to $350,000 for such additional month of Transition Services.
If completion of one or more Conversion Tracks requires an
eleventh month of Transition Services, ADMINSTRATOR shall be permitted to
invoice up to $165,000 for such additional month of Transition Services.
4. COST OVERRUNS.
If following completion of all Conversion Tracks ADMINISTRATOR's
and SDI's total Transition Service costs exceed $4,905,000, ADMINISTRATOR
may invoice CLIENT for such excess costs, which invoice shall include a
reasonably detailed
5
explanation of such excess costs, and CLIENT shall be obligated to pay to
ADMINISTRATOR, up to a maximum of $515,000 in respect thereof, less any
amounts invoiced by ADMINISTRATOR pursuant to Part IX.A.3 of this Work
Agreement, just above; provided that amounts invoiced for cost overruns
for which ADMINISTRATOR invoices CLIENT pursuant to this Part IX.A.4
shall reduce dollar for dollar the amount of the potential bonus payable
pursuant to Part IX.A.2 of this
Work Assignment, above.
If ADMINISTRATOR's and SDI's Transition Service costs
substantially exceed $5,420,000 as a result of occurrences or events not
caused by ADMINISTRATOR or SDI, such that the economic benefits of this
Work Assignment, taken as a whole over its entire initial term, to
ADMINISTRATOR and SDI are materially adversely affected, then CLIENT
agrees to discuss with ADMINISTRATOR in good faith an equitable
adjustment of the amount of such excess costs each of them should bear.
B. FOR CONTRACT ADMINISTRATION GENERALLY
Subject to adjustment pursuant to 1, 2, and 3 below, and Section
3.12(e) of the Master Agreement regarding volume discounts, the fees for
the Services in respect of the Contracts shall be as set forth on
SCHEDULE F. Such fees shall be due and payable in respect of a Contract
based on the status of such Contract, active vs. lapsed, terminated or
otherwise not-in-force, as of the beginning of a calendar month; PROVIDED
THAT if a Contract is transitioned to ADMINISTRATOR and SDI for servicing
during a calendar month, the fees in respect of such Contract shall be
based on the status of the Contract when transitioned and shall be
prorated based on the number of Business Days remaining in the month
relative to the total number of Business Days in such month; and further
provided that such fees shall be similarly prorated for the last calendar
month of the Assignment if such last calendar month is a partial month.
The fee for lapsed, terminated or otherwise not-in-force Contracts shall
be chargeable unless and until the Contract has been purged from
ADMINISTRATOR's systems.
1. CPI ADJUSTMENT
The foregoing fees and rates are subject to a CPI adjustment in
accordance with Section 8.6 of the Master Agreement.
2. MINIMUM MONTHLY CHARGES
Notwithstanding the foregoing provisions of this clause B, the
provisions of clause C below, and Section 3.12(e) of the Master Agreement
regarding volume discounts, the minimum monthly fees for the Services
shall be $125,000, plus any charges due pursuant to clause C. below, less
any credits.
3. PERFORMANCE CREDITS
In addition to all other credits to which CLIENT shall be entitled
pursuant to this Assignment, should ADMINISTRATOR or SDI fail to have
satisfied the Service Level Agreements set forth herein above, for a
calendar month, and upon receipt of notice fail
6
to correct its performance the following calendar month in respect of the
same performance standard(s) against which it failed in respect of the
preceding calendar month, CLIENT shall be entitled to a credit in the
amount of two and one half percent (2.5%) of the fees otherwise due for
such third month.
4. OUT-OF-POCKET AND PASS-THROUGH COSTS
CLIENT shall reimburse certain out-of-pocket and pass-through
costs of the type set forth below:
1. postage and express mail charges;
2. sales and use taxes on services provided;
3. onsite and offsite paper file records storage and retrieval
costs;
4. printing and mailing of quarterly and annual statements;
5. stationary, paper, envelopes and related supplies used in
mailings to Insureds;
6. broker communication charges;
7. costs for regulatory mailings (such as fund reports,
prospectuses, proxies, privacy notices, TPA notices, etc.);
8. underwriting and claims investigation charges;
9. proxy tabulation costs in respect of voting by Contract
holders; and
10. other costs expressly identified in this Assignment (or the
Agreement) as out-of-pocket or pass-through costs.
C. STANDARD RATES
The hourly charges for any services of internal personnel of
ADMINISTRATOR and/or SDI reasonably incurred by ADMINISTRATOR and/or SDI
that are specific and unique to servicing CLIENT shall be as set forth on
SCHEDULE G. No such services will be incurred without prior written
approval by CLIENT. All such work will be performed by such persons for
ADMINISTRATOR and SDI, not CLIENT, but at CLIENT's expense.
D. FEES FOR BROKERAGE SERVICES
The fees payable by CLIENT to SDI for SDI's performance of the
Brokerage Services are included in the fees payable for the Services. No
additional sums shall be due and payable by CLIENT to SDI; ADMINISTRATOR
will pay over to SDI the fees due SDI for performance of the Brokerage
Services from the fees paid to ADMINISTRATOR pursuant to this Part VIII.
X. TERM AND TERMINATION
A. TERM
This
Work Assignment shall have an initial term of ten (10) years
commencing on the date first written above.
7
B. TERMINATION CHARGE
The Termination Charge shall be the amount of the minimum monthly
Service Fees, as set forth in B.2, above, times the number of months
remaining until the term of the
Work Assignment, as set forth just above,
was initially scheduled to expire. Partial months shall be pro-rated
based on the ratio of total number of Business Days remaining in such
month to the total number of Business Days in such month.
XI. NOTICES TO CLIENT
Notices to CLIENT shall be sent to CLIENT at:
Allmerica Financial Life and Annuity Company
c/o The ▇▇▇▇▇▇▇ Sachs Group, Inc.
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: Reinsurance Group
8
IN WITNESS WHEREOF, the parties executed this Assignment on the
date first set forth above.
SECURITY BENEFIT LIFE SECURITY DISTRIBUTORS, INC.
INSURANCE COMPANY One Security Benefit Place
One Security Benefit Place Topeka, Kansas 66636-0001
▇▇▇▇▇▇, ▇▇▇▇▇▇ ▇▇▇▇▇-▇▇▇▇
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇
------------------------- ------------------------
[signature] [signature]
Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ Name: ▇▇▇▇▇ ▇. ▇▇▇▇▇
Title: Vice President Title: Vice President
ALLMERICA FINANCIAL LIFE AND ANNUITY COMPANY
c/o The ▇▇▇▇▇▇▇ ▇▇▇▇▇ Group, Inc.
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
By: /s/ ▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇
-------------------------
[signature]
Name: ▇▇▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇▇
------------------------
[printed]
Title: Chief Operating Officer and Vice President
-------------------------------------------
9
SCHEDULE A
CONTRACTS
PLAN # CONV.
PLATFORM CODE PRODUCT CONTRACTS TYPE METHOD
Beacon 137112 Allmerica Premier Choice 358 AAI Full History
Beacon 137512 Allmerica Premier Choice EDB 73 AAI Full History
Beacon 338510 Delaware Golden Medallion 1588 AAI Full History
Beacon 437513 Allmerica Select Acclaim 4009 AAI Full History
Beacon 437514 Allmerica Select Option - ▇ ▇▇ ▇▇▇ Full History
Beacon 438510 Allmerica Select ▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇ Full History
Beacon 538510 Pioneer Xtra Vision 4012 AAI Full History
Beacon 637113 ▇▇▇▇▇▇▇ Gateway Incentive 182 AAI Full History
Beacon 637513 ▇▇▇▇▇▇▇ Gateway Incentive EDB 259 AAI Full History
Beacon 638510 ▇▇▇▇▇▇▇ Gateway Plus ▇▇▇▇▇ ▇▇▇ Full History
Beacon 837511 Allmerica Value Generation 1 AAI Full History
Beacon 937511 Directed Advisory Solutions 14 AAI Full History
CORE ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇ ▇▇▇ ▇▇▇▇▇ in Time
CORE 2SIAS Estate Optimizer-2nd-to-die ▇▇ ▇▇▇ ▇▇▇▇▇ in Time
CORE 1SLAS Estate Optimizer-single life ▇▇ ▇▇▇ ▇▇▇▇▇ in Time
CORE 2SLAS Estate Optimizer-single life ▇▇▇ ▇▇▇ ▇▇▇▇▇ in Time
CORE 3SLAS Estate Optimizer-single life unisex ▇ ▇▇▇ ▇▇▇▇▇ ▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ Optimizer-single life unisex ▇▇ ▇▇▇ ▇▇▇▇▇ in Time
CORE 2GUFX ▇▇▇▇▇▇▇ ▇ ▇▇▇ ▇▇▇▇▇ in Time
CORE 1GVFX Group ▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇ in Time
CORE 2GVFX Group VEL ▇▇▇ ▇▇▇ ▇▇▇▇▇ in Time
CORE ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇ ▇▇▇ ▇▇▇▇▇ in Time
CORE ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇ ▇▇▇ ▇▇▇▇▇ in Time
CORE 105CM Mass Mutual VUL ▇▇▇ ▇▇▇ ▇▇▇▇▇ in Time
CORE 106CM Mass Mutual VUL ▇▇▇ ▇▇▇ ▇▇▇▇▇ in Time
CORE 107CM Mass Mutual ▇▇▇ ▇ ▇▇▇ ▇▇▇▇▇ in Time
CORE 108CM Mass Mutual ▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇ in Time
CORE 046VD Select Inheiritage ▇▇ ▇▇▇ ▇▇▇▇▇ in Time
CORE 047VD Select Inheiritage ▇▇▇ ▇▇▇ ▇▇▇▇▇ in Time
CORE 131VD Select Life ▇▇▇ ▇▇▇ ▇▇▇▇▇ in Time
CORE 132VD Select Life ▇▇▇▇ ▇▇▇ ▇▇▇▇▇ in Time
CORE 133VD Select Life ▇▇ ▇▇▇ ▇▇▇▇▇ in Time
CORE 134VD Select Life ▇▇▇ ▇▇▇ ▇▇▇▇▇ in Time
CORE 1SISS Select ▇▇▇-▇▇▇-▇▇-▇▇▇ ▇ ▇▇▇ ▇▇▇▇▇ in Time
CORE 2SISS Select SPL-2nd-to-die ▇▇▇ ▇▇▇ ▇▇▇▇▇ in Time
CORE 1SLSS Select SPL-single life ▇▇ ▇▇▇ ▇▇▇▇▇ in Time
CORE 2SLSS Select SPL-single life ▇▇▇▇ ▇▇▇ ▇▇▇▇▇ in Time
CORE 3SLSS Select SPL-single life unisex 1 VUL Point in Time
CORE 4SLSS Select SPL-single life unisex ▇▇ ▇▇▇ ▇▇▇▇▇ in Time
CORE 1SITS Transamerica ▇▇▇-▇▇▇-▇▇-▇▇▇ ▇ ▇▇▇ ▇▇▇▇▇ in Time
CORE 2SITS Transamerica ▇▇▇-▇▇▇-▇▇-▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇ in Time
CORE 1SLTS Transamerica SPL-Single life ▇▇ ▇▇▇ ▇▇▇▇▇ in Time
A-1
CORE 2SLTS Transamerica SPL-single life ▇▇▇ ▇▇▇ ▇▇▇▇▇ in Time
CORE 3SLTS Transamerica SPL-single life 1 VUL Point in Time
CORE 4SLTS Transamerica SPL-single life ▇▇ ▇▇▇ ▇▇▇▇▇ in Time
CORE 105TA Transamerica VEL ▇▇▇ ▇▇▇ ▇▇▇▇▇ in Time
CORE 106TA Transamerica VEL ▇▇▇▇ ▇▇▇ ▇▇▇▇▇ in Time
CORE 108TA Transamerica ▇▇▇ ▇ ▇▇▇ ▇▇▇▇▇ in Time
CORE 046VD Variable Inheiritage ▇▇▇ ▇▇▇ ▇▇▇▇▇ in Time
CORE 047VD Variable Inheiritage ▇▇▇▇ ▇▇▇ ▇▇▇▇▇ in Time
CORE ▇▇▇▇▇ ▇▇▇ ▇▇ ▇▇▇ ▇▇▇ ▇▇▇▇▇ in Time
CORE 106VD ▇▇▇ ▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇ in Time
CORE ▇▇▇▇▇ ▇▇▇ ▇▇ ▇▇▇▇▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇ in Time
CORE 108VD VEL 87 Unisex ▇▇▇ ▇▇▇ ▇▇▇▇▇ in Time
CORE 105VX VEL 91 ▇▇▇ ▇▇▇ ▇▇▇▇▇ in Time
CORE 106VX ▇▇▇ ▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇ in Time
CORE 107VX VEL 91 Unisex ▇▇ ▇▇▇ ▇▇▇▇▇ in Time
CORE 108VX VEL 91 Unisex ▇▇▇ ▇▇▇ ▇▇▇▇▇ in Time
CORE 105VY ▇▇▇ ▇▇ ▇▇▇▇ ▇▇▇ ▇▇▇▇▇ in Time
CORE 105VZ ▇▇▇ ▇▇ ▇▇ ▇▇▇ ▇▇▇▇▇ in Time
CORE 106VY ▇▇▇ ▇▇ ▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇ in Time
CORE 106VZ VEL 93 ▇▇▇ ▇▇▇ ▇▇▇▇▇ in Time
CORE 107VY VEL 93 Unisex ▇▇▇ ▇▇▇ ▇▇▇▇▇ in Time
CORE 108VY VEL 93 Unisex 1833 VUL Point in Time
CORE 108VZ VEL 93 Unisex ▇▇ ▇▇▇ ▇▇▇▇▇ in Time
CORE ▇▇▇▇▇ ▇▇▇ PG/VEL Plus ▇▇▇ ▇▇▇ ▇▇▇▇▇ in Time
CORE ▇▇▇▇▇ ▇▇▇ PG/VEL Plus 1874 VUL Point in Time
Lifeforce 115E1 Allmerica VUL 2001 83 VUL Full History
Lifeforce 115E3 Allmerica Select Life Plus 54 VUL Full History
Lifeforce 115IM Allmerica VUL 2001IMO 6 VUL Full History
Lifeforce 115SP Allmerica SPL II-single life 1 VUL Full History
Lifeforce 116CL Canada Life VUL 1 VUL Full History
Lifeforce 116E1 Allmerica VUL 2001 588 VUL Full History
Lifeforce 116E2 CPA VEL 2001 3 VUL Full History
Lifeforce 116E3 Allmerica Select Life Plus 401 VUL Full History
Lifeforce 116FI First Union VUL 3 VUL Full History
Lifeforce 116IM Allmerica VUL 2001 IMO 48 VUL Full History
Lifeforce 116SD Allmerica SPL II-2nd-to-die 1 VUL Full History
Lifeforce 116SP Allmerica SPL II-single life 25 VUL Full History
Lifeforce 116SV Allmerica Select Survivorship 66 VUL Full History
Lifeforce 117E1 Allmerica VUL 2001 17 VUL Full History
Lifeforce 117E3 Allmerica Select Life Plus 3 VUL Full History
Lifeforce 118E1 Allmerica VUL 2001 111 VUL Full History
Lifeforce 118E3 Allmerica Select Life Plus 26 VUL Full History
Lifeforce 118IM Allmerica VUL 2001 IMO 1 VUL Full History
Lifeforce 120SV Allmerica Select Survivorship 6 VUL Full History
Vantage 121110 67 series single pay 3 AA II Point in Time
Vantage 122110 69 series single pay 25 AA II Point in Time
Vantage 123110 75 series single pay 1 AA II Point in Time
Vantage 124210 Single Variable Individual Annuity (80-92) 357 AA II Point in Time
A-2
Vantage 124220 Single Pay Fixed BN 93 AA II Point in Time
Vantage 124310 Colonial AVA single pay 13 AA II Point in Time
Vantage 125220 Exec-Annuity I 182 AA II Point in Time
Vantage 126220 Exec-Annuity II 279 AA II Point in Time
Vantage 131110 Flexible Variable Individual Annuity (67-75) 4 AA II Point in Time
Vantage 132110 Flexible Variable Individual Annuity 45 AA II Point in Time
Vantage 133210 Elective Variable Individual Annuity (75-80) 287 AA II Point in Time
Vantage 133220 Elective Fixed Individual Annuity (75-79) 200 AA II Point in Time
Vantage 134210 Elective Variable Individual Annuity (80-96) 6615 AA II Point in Time
Vantage 134220 Elective Fixed Individual Annuity (79-95) 2424 AA II Point in Time
Vantage 134420 Elective Fixed Individual Annuity (84-92) 7 AA II Point in Time
Vantage 137210 Exec Annuity Plus 91 Annuity 17120 AA II Point in Time
Vantage 137310 Exec Annuity Plus 93 Annuity 14835 AA II Point in Time
Vantage 137410 Allmerica Advantage Annuity 55144 AA II Point in Time
Vantage 141110 Stipulated Variable Individual Annuity (67-75) 1 AA II Point in Time
Vantage 231110 Group Flexible Pay1 ▇ ▇▇ ▇▇ ▇▇▇▇▇ ▇▇ ▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇ Group Flexible Pay2 8 AA II Point in Time
Vantage 337210 Delaware Medallion 92 Annuity 1099 AA II Point in Time
Vantage 337310 Delaware Medallion 94 Annuity 1164 AA II Point in Time
Vantage 337410 Delaware Medallion III Annuity 9431 AA II Point in Time
Vantage 437210 Allmerica Select Resource 5161 AA II Point in Time
Vantage 437410 Allmerica Select Resource II 21959 AA II Point in Time
Vantage 437412 Allmerica Select Charter ▇▇▇▇ ▇▇ ▇▇ ▇▇▇▇▇ ▇▇ ▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇ Pioneer Vison Annuity 881 AA II Point in Time
Vantage 537410 Pioneer Vison 2 Annuity 10885 AA II Point in Time
Vantage 537412 Pioneer C-Vision 118 AA II Point in Time
Vantage 637410 ▇▇▇▇▇▇▇ Ellte Annuity 19496 AA II Point in Time
Vantage 637412 ▇▇▇▇▇▇▇ Gateway Advisor ▇▇▇ ▇▇ ▇▇ ▇▇▇▇▇ ▇▇ ▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Custom Annuity ▇▇▇▇ ▇▇ ▇▇ ▇▇▇▇▇ ▇▇ ▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇ Fulcrum Annuity 293 AA II Point in Time
A-3
SCHEDULE B
TRANSITION SERVICES*
1. CLIENT SETUP. ADMINISTRATOR and SDI shall work with CLIENT and AFC to
develop any necessary enhancements with respect to the following:
(a) incoming and outgoing interfaces;
(b) operational reporting;
(c) interfaces to DST, NSCC and other business parties;
(d) web and IVR;
(e) commissions; ,
(f) printed output;
(g) pricing and trades;
(h) performance returns;
(i) accounts payable;
(j) billing and reconciliation;
(k) archive database; and
(l) data mart consulting;
2. CONVERSION. ADMINISTRATOR and SDI, in cooperation with CLIENT and AFC,
shall evaluate, translate and transition the Contracts to their systems.
Transition of the CLIENT Contracts will be completed in independent Conversion
Tracks:
(a) Variable Annuities I (I.E., AA I);
(b) Variable Annuities II (I.E., AA II); and
(c) Variable Universal Life.
(See 3 AND 4. below regarding the transition of separate accounts,
images and lockboxes.)
ADMINISTRATOR will compare all Contracts being transitioned as per
their systems VIS-A-VIS the systems in use by AFC prior to
transition in respect of the following (as applicable):
(a) total account value;*
(b) value by fund;*
(c) units by fund;*
(d) death benefit amount;
(e) cash value;
(f) net amount at risk;
(g) fixed account deposit date;
(h) face amount;
(i) accumulative premium and withdrawals; and
----------
* Payment for Transition Services furnished pursuant to the Interim Transition
Services Agreement shall be due and payable pursuant to the terms thereof.
B-1
(j) additional items approved by all parties.
If the comparison in respect of the asterisked items
reveals a difference less than or equal to the lesser of
0.5% or $10 (the "Tolerance"), ADMINISTRATOR shall
automatically adjust the values on its systems to equal the
values on AFC's systems. If the comparison in respect of
any item reveals a difference greater than the Tolerance,
ADMINISTRATOR shall promptly investigate the reason for the
discrepancy. To the extent the reason is attributable to
ADMINISTRATOR'S systems, ADMINISTRATOR shall correct its
systems. If any remaining discrepancy is then less than
the, Tolerance, ADMINISTRATOR shall proceed as set forth
above. If any remaining discrepancy is greater than the
Tolerance, ADMINISTRATOR shall inform CLIENT of the
remaining discrepancy and obtain revised data and/or
instructions from CLIENT on resolving the discrepancy.
ADMINISTRATOR and SDI shall validate the remainder of
Contract information by reviewing an agreed upon sampling
of the Contracts across all plan codes against agreed
tolerance levels and resolve discrepancies.
3. SEPARATE ACCOUNTS. ADMINISTRATOR and SDI shall work, in cooperation with
CLIENT and AFC, to transfer the following functions to ADMINISTRATOR and SDI
systems:
(a) daily pricing;
(b) daily fund trading; and
(c) performance returns.
The transfer of these functions will be coordinated and
moved in conjunction with the latest scheduled Conversion
Track.
4. IMAGE/LOCKBOX. ADMINISTRATOR and SDI shall work, in cooperation with
CLIENT and AFC, to:
(a) evaluate the current image and lockbox systems used
in connection with the Contracts and establish
appropriate workflow processes on ADMINISTRATOR and
SDI systems;
(b) work with AFC's information technology resources to
transition existing electronic images to
ADMINISTRATOR'S and SDI's systems; and
(c) identify required paper files and arrange for
delivery of them to ADMINISTRATOR' and SDI'
facilities.
The transfer of these functions and the transition of electronic images will be
completed in phases, in conjunction with the associated Conversion Track.
B-2
SCHEDULE C
ADMINISTRATION SERVICES
1. PREMIUM AND LOAN REPAYMENTS.
(a) ADMINISTRATOR shall ▇▇▇▇ and collect all premiums and loan
repayments due under the Contracts, deposit them in an account
established by CLIENT for such purposes (see SECTION 6.2 of the Master
Agreement), return any unearned premiums or other premiums to be
refunded, and reconcile amounts paid with returned billing statements or
other remittance media.
(b) ADMINISTRATOR shall update the Contract owner master
records and all other records to reflect payments received and refunded.
(c) Code Section 7702(a) testing and administration as agreed
upon in the Master Agreement under Section 3.17
2. NOTICES, PROXIES, STATEMENTS, CONFIRMATIONS, AND OTHER MAILINGS TO
CUSTOMERS.
(a) ADMINISTRATOR shall inform policyholders and assignees of
any lapse in coverage under the Contracts, as well as ▇▇▇▇▇▇▇ ▇▇▇▇▇
period notices indicating that a lapse may be forthcoming as required by
the terms of the Contracts.
(b) ADMINISTRATOR, either directly or through a vendor, will
provide proxy processing for the underlying funds of the Contracts as
required by the participation agreements between CLIENT and the
underlying fund and in accordance with Applicable Law.
(c) ADMINISTRATOR shall mail reports, statements, and
confirmations to policyholders, insureds, claimants, and annuitants as
required by the Contracts and Applicable Law and in accordance with the
standard industry practices.
3. POLICYHOLDER SERVICES.
(a) ADMINISTRATOR shall maintain a toll free number call center
located in the United States, with properly licensed staffing sufficient
to handle inquiries on a prompt basis, to service policyholders,
claimants, annuitants, beneficiaries, and insureds and their authorized
agents and representatives in respect of the Contracts. The call center
shall operate and be available between the hours of 7:30 a.m. and 5:00
p.m. Central Standard Time. Regarding the provision of services in
respect of claims, see item 5 below. ADMINISTRATOR shall not furnish
advice or suggestions, but rather only factual responses.
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(b) On and after the Service commencement date, ADMINISTRATOR
shall maintain a web site that gives owners of Contracts full access to
Contract data including daily account values and unit values as well as
allows sub-account transfers and premium allocation changes, if and to
the extent such owners had such access and functionality as of the date
hereof. Such web site shall be designed, implemented and maintained in
accordance with standards of the insurance industry for customer
information access and on-line customer transactions, with such standards
including firewalls and other protections assuring: (a) the security of
the web site and of individual policyholder information and transactions,
and (b) the privacy of and limited access to, the policyholder's account
and account related information (or other personal or personally
identifying information). The Web will be available 24 hours a day, 7
days a week, other than necessary maintenance periods.
(c) On and after the Service commencement date, ADMINISTRATOR
shall maintain an IVR that gives owners of Contracts access to a subset
of Contract data including daily account values and unit values. Such IVR
shall be designed, implemented and maintained in accordance with
standards of the insurance industry for customer information access, with
such standards including protections assuring: (a) the security of the
IVR and of individual policyholder information, and (b) the privacy of
and limited access to, the policyholder's account and account related
information (or other personal or personally identifying information).
The IVR will be available 24 hours a day, 7 days a week, other than
necessary maintenance periods.
(d) ADMINISTRATOR shall, in accordance with written
underwriting and claims processing guidelines furnished by CLIENT, as
applicable, provide general policyholder services with respect to the
Contracts, including, but not limited to, the following, but excluding
any such services if, or to the extent that, licensing as a broker-dealer
is required to perform them:
(i) responding to inquiries, including inquiries
regarding the scope and amounts of coverage or benefits provided
under the Contracts;
(ii) supplying claimants, policyholders, annuitants,
beneficiaries, and insureds with appropriate instructions and
forms for reporting claims and for submitting relevant
information;
(iii) processing and recording changes in the Contracts
(including (A) changes of ownership, beneficiary, amount of
insurance, and options under the Contracts, and (B) changes in
name, address and other data related to the policyholders and
insureds under the Contracts), reissuances, and all financial
transactions (E.G., transfer requests from one subaccount to
another), in all cases within time intervals necessary to meet
SEC, NASD, and other applicable legal and regulatory requirements;
(iv) processing policy loans and surrenders;
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(v) processing replacements and exchange requests;
(vi) responding to inquires received (whether by
telephone, electronic transmission, facsimile, mail or otherwise)
from insureds, policyholders, beneficiaries and annuitants or
their authorized agents or representatives in accordance with the
Applicable Law and industry standards (including adjustments
incident to changes in Applicable Law or industry standards); and
(vii) processing any required or permitted changes, as and
when communicated to ADMINISTRATOR by CLIENT, in non-guaranteed
elements (E.G. costs of insurance and crediting rates on the
Contracts) and satisfying all related notice requirements in
connection with such required or permitted changes;
(e) ADMINISTRATOR shall calculate and assess (on a daily basis)
the mortality and expense risk charges and administrative charges, and
(on a monthly basis) cost of insurance, in accordance with the provisions
of the Contracts, and, insofar as not inconsistent with the terms
thereof, the prospectus and the statement of additional information
disclosure.
(f) ADMINISTRATOR shall obtain (on a daily basis) the net asset
value ("NAV") of each fund that serves as an investment option for the
Contracts and, provided the underlying fund timely furnishes its NAV,
compute the accumulation unit value of each subaccount of the separate
accounts of the Contracts in accordance with the provisions of the
Contracts, the prospectus and the statement of additional information
disclosure on any day when such calculation is required by the Investment
Company Act of 1940.
(g) ADMINISTRATOR shall calculate for CLIENT, in the manner
required by SEC regulations, as instructed or agreed by CLIENT, the
performance returns for the Contracts on a monthly, quarterly, and annual
basis as required by SEC regulations.
(h) ADMINISTRATOR shall prepare copies of contract data pages,
inserts, or additions to Insurance Contracts as supplied by CLIENT and
mail such items to policy holders or agents as appropriate.
4. UNDERWRITING AND REINSTATEMENTS. See SECTION 3.5 of the Master Agreement.
ADMINISTRATOR is not required to agree to written underwriting guidelines
that would necessitate registration or licensure of ADMINISTRATOR as
anything other than a third party administrator; provided that if
Applicable Law changes such that procedures to which ADMINISTRATOR has
then previously agreed necessitate additional registration or licensure,
ADMINISTRATOR shall comply with such additional registration or licensure
requirements.
5. CLAIMS. See SECTION 3.6 of the Master Agreement ADMINISTRATOR is not
required to agree to written claims processing guidelines that would
necessitate registration or
C-3
licensure of ADMINISTRATOR as anything other than a third party
administrator; provided that if Applicable Law changes such that
procedures to which ADMINISTRATOR has then previously agreed necessitate
additional registration or licensure, ADMINISTRATOR shall comply with
such additional registration or licensure requirements.
6. TAXES.
(a) Corrective Processing in the event of correction of
transactions that occurred prior to the Service commencement date that
affect tax activity, CLIENT shall determine whether an adjustment should
be made to participant tax reporting information. Only corrections for
those transactions that do not involve an adjustment to federal income
tax ("FIT") and/or state income tax ("SIT") amounts will be made.
(b) ADMINISTRATOR shall prepare, mail and retain copies of all Tax
reporting related to the contracts required by Applicable Law, including,
without limitation, 1099-R, 1099-INT, 1099MISC, and 5498 for
policyholders and beneficiaries as required, and distribute the same to
policyholders and beneficiaries and appropriate authorities.
7. AGENT COMPENSATION. ADMINISTRATOR shall, on behalf of CLIENT, make
payments due from CLIENT to the broker/dealers of record for the
Contracts as required by written agreements between CLIENT and/or one of
its affiliates and such broker/dealers governing compensation paid in
connection with the sale and/or servicing of the Contracts, which
payments become due after the Service commencement date. In connection
therewith, ADMINISTRATOR shall also give effect to any transferred debit
balances and/or overpayments that are recoverable or deductible from
current or future commission payments. ADMINISTRATOR shall assure
compliance with all reasonable commission accounting or other standards.
8. CAREER AGENT AND BROKER/DEALER APPOINTMENT TRANSFER AND LICENSING.
ADMINISTRATOR shall, on behalf of CLIENT, provide the following support
for third party annuity and life broker/dealers and broker changes, in
each case relating to the Contracts, including with respect to:
(a) broker transfers;
(b) business transfers;
(c) broker setup;
(d) broker/dealer setup;
(e) confirmation of licensing for broker/dealers;
(f) maintenance of career agent and broker/dealer records; and
C-4
(g) career Agents - a data feed with required commissionable
events will be provided to the agreed upon party.
9. ACCOUNTING AND REPORTING SERVICES. ADMINISTRATOR shall perform, with
respect to the Contracts, all accounting and reporting of direct and
ceded premiums and claims (and other policyholder disbursements, policy
loans, commissions, premium tax payments and accruals). Such services
shall include all accounting and reporting necessary to provide CLIENT
with all required data needed for statutory ("SAP") and generally
accepted accounting principles ("GAAP") financial statements and filings
and state and federal income and premium tax reporting and filings. With
respect to premium taxes, ADMINISTRATOR'S reporting' shall be broken out
on a state-by-state basis and shall also be broken out between Life
Insurance Contracts and Annuity Contracts.
(a) After the end of each month ADMINISTRATOR shall furnish
CLIENT with the following factual information in the format agreed to by
both CLIENT and ADMINISTRATOR. ADMINISTRATOR will generate a control
report and identify a contact to help resolve any transmission or
balancing issues:
(i) general ledger summary file;
(ii) settlement report;
(iii) non-ledger transactions;
(iv) pending claim information;
(v) seriatim valuation contract file as needed to
calculate actuarial reserves;
(vi) contract file information, as needed, to support
reinsurance reporting;
(vii) premium tax and guarantee fund filings; and
(viii) assistance with information required under an agreed
upon format.
(b) Quarterly, ADMINISTRATOR shall, in addition to the normal
monthly reporting, furnish CLIENT with a Schedule D related to the
Separate Account business, including Unit Value Assets information -
within ten (10) Business Days following the last day of the applicable
quarter.
(c) Annually, ADMINISTRATOR shall in addition to the normal
monthly and quarterly reporting furnish CLIENT with the following
information necessary to complete the Annual Statement and state required
quarterly and supplemental filings, including the following within
fifteen (15) Business Days following the last day of the applicable
reporting period:
C-5
(i) Exhibit of Life Insurance (Annual Statement Pages 31
and 32) and Exhibit of Numbers (Annual Statement Page 33);
(ii) Exhibit of Number of Contracts, Contracts,
Certificates, Income Payable and Account Values In Force for
Supplementary Contracts, Annuities, Accident & Health and Other
Contracts;
(iii) Municipal Tax Detail (Town and County detail for
states requiring municipal taxes); and
(iv) Applicable note information.
(d) Annually, at an agreed time, ADMINISTRATOR shall have a SAS
70 report prepared for CLIENT by an external audit firm and include GS to
have ability to review testing and conduct tests.
10. COMPLIANCE SERVICES. ADMINISTRATOR shall provide CLIENT with the
following compliance services:
(a) provide, upon request, information regarding the Contracts
for market conduct examinations, analysis and state survey activities and
work with CLIENT to resolve problems and take corrective action with
regard to such matters;
(b) provide information to CLIENT related to the Contracts as
reasonably necessary for CLIENT to prepare filings with the SEC and NASD
(including, without limitation, compilation of information, if any,
related to the Contracts that would be reflected in any post-effective
amendment to a registration statement for a Contract, Form 24F-2, Form
N-SAR, quarterly FOCUS II/IIA reports, or annual FOCUS schedule 1);
(c) make special mailings, including, among other things, the
periodic mailing of privacy notices to owners and insureds/annuitants, as
requested and in the form supplied by CLIENT;
(d) promptly forward to CLIENT's compliance team any written
communication, and any tape recording of any oral communication, received
or made by ADMINISTRATOR primarily expressing a complaint against CLIENT,
ADMINISTRATOR or SDI with respect to a Contract, or otherwise requiring
that CLIENT, rather than ADMINISTRATOR on its behalf, respond to such
communication because a response by ADMINISTRATOR or SDI is outside the
scope of the services to be provided by them, and information in
ADMINISTRATOR'S or SDI's possession relevant to the fashioning of a
response; provided that ADMINISTRATOR shall not be obligated to draft,
recommend or provide advice regarding responses to complaints;
(e) cooperate and make its personnel available to assist CLIENT
in the event a complaint shall involve performance of the Administration
Services or the Brokerage Services;
C-6
(f) provide compliance services required by OFAC and anti-money
"laundering" procedures, including but not limited to those adopted under
the U.S.A. Patriot Act, in respect of performance of the Administration
Services;
(g) assist (excluding the provision of advice) CLIENT in
connection with responding to inquiries relating to the Contracts from
the SEC, NASD, NAIC or the insurance or securities departments of the
various states in which the policyholders are located; and
(h) cooperate with CLIENT's efforts to facilitate fraud
detection and investigation that relate to the Contracts and in
accordance with CLIENT's anti-fraud plan and procedures.
ADMINISTRATOR's Service Manager in respect of CLIENT shall serve as the
front person for purposes of communications by or to CLIENT related to
complaints, regulatory and compliance matters, and any third party
litigation related to the Contracts, the Administration Services, or the
Brokerage Services; provided that such service shall not preclude the
Service Manager from having other employees of ADMINISTRATOR or SDI
assist with respect to such communications or in particular cases or with
respect to particular matters, communicating information to CLIENT or
receiving information from CLIENT on his or her behalf.
C-7
SCHEDULE D
BROKERAGE SERVICES
1. Aggregating and netting customer orders forwarded by ADMINISTRATOR
to SDI for the purchase and sale of shares of the mutual funds which serve as
the underlying investment of the Contracts (each a "Fund");
2. As determined by CLIENT, submitting net orders to (a) CLIENT or
(b) the Funds, or their respective agents; provided CLIENT has arranged for the
Funds to accept such orders from SDI on behalf of CLIENT;
3. As determined by CLIENT, (a) instructing CLIENT on funding of
disbursement accounts as necessary to make trade settlement payments and
effecting such payments from such CLIENT disbursement accounts or (b) forwarding
wire transfer instructions to CLIENT in order to settle Fund trades; and
4. Assisting ADMINISTRATOR in the daily reconciliation of CLIENT and
Contract owner records to the overall positions with the Funds.
D-1
SCHEDULE E
SERVICE LEVEL AGREEMENTS
A. GENERAL
TASK PERFORMANCE STANDARD
--------------------------------------------------------------------------------
Mailing Standards:
- Sending out requested forms - Mailed within 5 Business Days of
request
- Sending out Policyholder Annual - As required by Applicable Law
Reports
- Commission Checks - Mailed within 5 Business Days of
production
- Confirmation statements and checks - Mailed within 5 Business Days
following related financial
transaction
- Statements of Account - Mailed by the 30th day after the end
of the quarter or year to which the
statements relate
Phone Standards:
- Answer time - 65% of calls answered within 60
seconds
- hours of operation from 7:30 am to
5:00 pm CST.
Processing Standards:
- Average tune to process non-financial - Five (5) Business Days from receipt of
change requests such as address, request
beneficiary, and payment mode
- Average tune to process financial - Same Business Day if received, in good
change requests such as transfers, order, prior to the close of regular
withdrawals, and automatic rebalancing trading hours on the New York Stock
Exchange (normally 4:00 p.m. EST).
Next Business Day if received after
New York Stock Exchange close
E-1
Processing Policy Claims - In accordance with agreed Claims
Guidelines (see Section 3.6 of Master
Agreement)
Web Service - 24-7 web access will be provided 99.5%
of the time measured over the trailing
12 months (or the life of the
Work
Assignment if then less 12 months),
except as required for scheduled
maintenance or due to circumstances
outside the Administrators control
IVR service - ▇▇-▇ ▇▇▇ access will be provided 99.5%
of the time measured over the trailing
12 months (or the life of the Work
Assignment if then less 12 months),
except as required for scheduled
maintenance or due to circumstances
outside the Administrators control
E-2
Trading Standards - Orders from policyholders to GSAM
trust to be transmitted by 10:00 a.m.
(CST).
- Payments to GSAM (provided sufficient
funds in appropriate disbursement
account) to be transmitted by 12:00
p.m. (CST)
Compliance Standards:
- Regulatory Complaint from Regulator - Copy of complaint to CLIENT within 2
Business Days
- Producer Incident - Copy of incident to CLIENT within 2
Business Days
- Copies of correspondence and voice - Submitted to CLIENT within 15 Business
recordings relevant to customer Days of Service Provider receipt,
complaints unless additional time has been
requested
* Performance against these standards shall be measured monthly and
reported by ADMINISTRATOR to CLIENT within ten (10) Business Days
following the end of each month.
** Neither Contracts in Service for less than two full calendar months
following transition to ADMINISTRATOR and SDI for administration nor
Contracts in respect of which records are incomplete need be (but they
may be) considered by ADMINISTRATOR for purposes of determining and
reporting on performance relative to such Service Level Agreements. The
procedures for processing Contracts in respect of which records are
incomplete will be handled as exception processing.
*** ADMINISTRATOR shall not be considered to have failed to satisfy such
Service Level Agreements if such failure is the result of extraordinary
events, such as events OF FORCE MAJEURE, a material ratings downgrade of
CLIENT, or publication of an article that CLIENT is near insolvency;
CLIENT understands and acknowledges that such Service Level Agreements
are intended only as measures of commercially reasonable performance
under anticipated ordinary business conditions.
E-3
**** ADMINISTRATOR shall not be held responsible for failure to meet such
Service Level Agreements due to material production backlogs on Service
commencement dates.
***** ADMINISTRATOR and CLIENT agree to discuss in good faith any service
level change order request hereafter made by CLIENT in the event the
levels of service actually being furnished by ADMINISTRATOR are not,
overall, comparable or better relative to what had been furnished by
CLIENT and FAFLIC to their customers prior to GS GROUP's acquisition of
CLIENT.
B. BROKERAGE SERVICE LEVEL AGREEMENTS
Orders for the purchase and sale of the Funds shall be effected in
compliance, in all material respects, with the terms of the applicable
participation agreement between the Fund (and/or its agents) and CLIENT,
provided, however, that (a) CLIENT has furnished SDI with copies of all
applicable participation agreements and (b) the agreement of the Funds (and/or,
as required, the NSCC, in the case of NSCC-traded Funds) to allow SDI to
initiate trades on behalf of CLIENT has been obtained by CLIENT.
C. SIGNIFICANT AND CHRONIC
Service Level Agreement performance failures shall be regarded as
"significant" if performance is worse than as specified below:
TASK PERFORMANCE STANDARDS
--------------------------------------------------------------------------------
Mailing Standards:
- Sending out requested forms - Mailed within 10 Business Days of
request
- Sending out Policyholder Annual - Mailed within 15 Business Days of
Reports production
- Commission Checks - Mailed within 15 Business Days of
production
- Confirmation statements and checks - Mailed within 15 Business Days of
production
- Statements of Account - Mailed by the 45th day after the end
of the quarter or year to which the
statements relate
Phone Standards:
- Answer time - 60% of calls answered within 120
seconds
E-4
Processing Standards:
- Average time to process non-financial - Twenty (20) Business Days from receipt
change requests such as address, of request
beneficiary, and payment mode
- Average time to process financial - Within 5 business days if received, in
change requests such as transfers, good order, prior to the close of
withdrawals, and automatic rebalancing regular trading hours on the New York
Stock Exchange (normally 4:00 p.m.
EST).
Web Service - 24-7 web access will be provided 90%
of the time measured over the trailing
12 months (or the life of the Work
Assignment if then less 12 months),
except as required for scheduled
maintenance or due to circumstances
outside the Administrators control
IVR service - ▇▇-▇ ▇▇▇ access will be provided 90%
of the time measured over the trailing
12 months (or the life of the Work
Assignment if then less 12 months),
except as required for scheduled
maintenance or due to circumstances
outside the Administrators control
Compliance Standards:
- Regulatory Complaint from Regulator - Copy of complaint to CLIENT within 10
Business Days
- Producer Incident - Copy of incident to CLIENT within 10
Business Days
- Copies of correspondence and voice - Submitted to CLIENT within 30 Business
recordings relevant to customer Days of Service Provider receipt,
complaints unless additional time has been
requested
E-5
Significant performance failures that occur in four consecutive months,
or that occur in any eight months out of any twelve-month period, shall be
regarded as "chronic".
E-6
SCHEDULE F
CONTRACT ADMINISTRATION FEES
LAPSED, TERMINATED
ACTIVE VUL ACTIVE ANNUITY OR OTHERWISE
YEARS CONTRACTS CONTRACTS NOT-IN-FORCE CONTRACTS
---------------------------------------------------------------------
1-10 $ 3.625/month $ 3.50/month $ 0.167/month
F-1
SCHEDULE G
STANDARD RATES
2005 Time and Materials Rates
Senior Professional Staff
- Attorneys, Executives $ 175
- Project Manager $ 125
Professional Staff
- Actuaries $ 125
- Senior Programmer Analyst,
Senior Business Analyst $ 110
- Financial Accountant $ 95
- Programmer Analyst,
Business Analyst $ 90
- Paralegal, Compliance $ 80
Service Center Personnel
- domestic $ 50
- offshore $ 20
The foregoing charges shall be invoiced in arrears and due on the same
terms as invoices for fees due pursuant to Section IX.B of the Assignment.
G-1