Exhibit 10.16


 


MANAGEMENT AND ACCOUNTING

SERVICES AGREEMENT


 


This MANAGEMENT AND ACCOUNTING SERVICES AGREEMENT (this “Agreement”) dated as of this 1st
day of January, 2000 is by and between ACE Insurance Management Ltd. (“AIM”), and ACE Capital Re International
Ltd. (“ACE Cap Re”) both companies
incorporated and organized under the laws of Bermuda (ACE Cap Re and AIM are collectively referred to herein as
the “Parties”).


 


RECITALS


 


WHEREAS, ACE Cap Re, a wholly-owned subsidiary of ACE Bermuda Insurance
Ltd., desires to contract with AIM, a wholly owned subsidiary of ACE Bermuda
Insurance Ltd., to provide certain accounting and administrative services and
AIM is willing to provide such services in accordance with and subject to the
terms and conditions hereof.


 


NOW THEREFORE, in consideration of the premises and other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties agree as follows:


 


ARTICLE 1

DUTIES OF AIM


 


Subject
to such specified guidelines and limitations as may be established from time to
time by ACE Cap Re, AIM shall provide the following services to ACE Cap Re
(hereinafter “Services”) during
the Term of this Agreement:


 


A.    Accounting Services.


 


AIM shall:


 


1.     Make disbursements from ACE Cap Re’s bank accounts in settlement of the
liabilities of ACE Cap Re; provided that the same shall be subject to such
authority limitations as ACE Cap Re, in its sole discretion, shall communicate
to AIM in writing from time to time.


 


2.     Maintain and prepare accounts payable ledgers and journals (including
accruals where necessary).  Such ledgers
and journals shall be prepared in accordance with generally accepted accounting
principles and standards for the insurance industry and shall comply with
applicable insurance rules and regulations.


 


3.     Prepare and maintain investment portfolio monthly journals and ledgers


 


4.     Administer employee payroll accounting, disbursements, and monthly
reporting to both ACE Cap Re and its employees (including income tax
withholding and remittances to the US Government, as applicable).


 


5.     Provide monthly reports and analyses to ACE Cap Re on investment
results, payroll and other disbursements;


 


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6.     Monitor and review ACE Cap Re’s investment portfolio in accordance with
investment guidelines and provide a monthly compliance report to ACE Cap Re on
the same.


 


7.     Prepare and provide to ACE Cap Re, financial statement disclosure and
footnotes with regard to ACE Cap Re’s investment portfolio.


 


B.    Administrative Services.


 


AIM shall:


 


1.     Order, collect and deliver stationery and other supplies when
requisitioned by ACE Cap Re.


 


2.     As respects hiring of employees by ACE Cap Re, post advertisements,
file required forms with and act as liaison to the Bermuda Government
immigration department, and, upon request, interview prospective employees.


 


3.     Provide information system technology support, including purchasing and
installation of all computer hardware, software and communications; provide ongoing
development and contingency (back up) support, as reasonably required.


 


4.     Provide building maintenance services, including but not limited to
ordering and installation of fixtures and fittings, provision of cleaning
services, making repairs and arranging and managing office remodeling work or
contracting with third parties for provision of the same.


 


5.     Book travel arrangements for ACE Cap Re’s employees, upon request.


 


C.    Professional Services


 


AIM shall:


 


1.     Assist ACE Cap Re in satisfaction of corporate compliance with Bermuda
insurance regulations and filing requirements. 
The Parties acknowledge that AIM shall not be required to file statutory
financial statements on behalf of ACE Cap Re.


 


2.     Provide legal assistance upon request.


 


3.     Provide actuarial services upon request, including loss reserve
specialist.


 


D.    Other


 


1.     AIM shall provide such other supplies and services as may be mutually
agreed to by the Parties subject to the Fee specified in Article 4 of this
Agreement or such additional compensation as is mutually agreed.


 


2.     AIM shall provide such additional reports as may be reasonably
requested by ACE Cap Re.


 


3.     For the avoidance of doubt and without limitation, the services
provided by AIM under this Agreement shall not include investment management,
audit, preparation of GAAP or statutory financial statements, corporate
governance or stewardship, hiring of employees.


 


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ARTICLE 2

DUTIES OF ACE CAP RE


 


ACE
Cap Re shall:


 


A.    Comply promptly with any reasonable request for instructions, which AIM
may make in order to perform its duties efficiently under this Agreement.


 


B.    Provide funds adequate for AIM to administer the accounts payable
function under this Agreement.


 


C     Compensate
AIM as provided in Article 4 hereof.


 


ARTICLE 3

TERM


 


A.    This Agreement shall commence on the date hereof and shall be a
continuous contract until and unless terminated by either party upon provision
at least sixty (60) days’ prior written notice to the other.


 


B.    Termination of this Agreement shall not relieve either party of its
liability for performance under this Agreement prior to the date of
termination.


 


ARTICLE 4

COMPENSATION


 


A.    ACE Cap Re shall pay AIM for all services rendered under this Agreement
a flat fee per annum (the “Fee”)
payable in four (4) equal installments, quarterly in advance.


 


B.    The Fee for the first annual period of this Agreement is one hundred
eighty thousand US Dollars ($180,000).


 


C.    The Fee may be reviewed and adjusted by the mutual agreement of the
Parties on each annual anniversary of this Agreement or coincident with any
substantive changes in the services provided by AIM to ACE Cap Re.


 


D.    It is understood and agreed that the Fee paid to AIM under this
Agreement shall include payment for all supplies and services rendered by AIM
hereunder with the exception of out of pocket expenses incurred by AIM from the
purchase or rental of personal property for ACE Cap Re (including stationery,
furniture, computers, fixtures, etc.); banking or custodial fees; Bermuda and
other countries’ government taxes, fees and license costs; and third party
attorney, audit, or actuarial fees.


 


ARTICLE 5

INDEMNIFICATION


 


AIM
does not assume any responsibility under this Agreement other than to render
the Services called for under this Agreement in good faith and shall have no
liability to ACE Cap Re except for fraud, or dishonesty, gross negligence,
willful default or bad faith; provided however, that any error or omission by
AIM in performance of its duties hereunder shall be rectified promptly upon its
discovery.


 


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ARTICLE 6

BOOKS AND RECORDS


 


A.    AIM shall keep, in a manner and form approved by and acceptable to ACE
Cap Re, records of all business conducted under and pursuant to this
Agreement.  ACE Cap Re’s books and
records shall be maintained separate and apart from other records and
information of AIM.


 


B.    ACE Cap Re shall have the right, from time to time, to conduct reviews,
inspections and/or audits of any or all of the records and documents related to
its business under this Agreement, during ordinary business hours upon
reasonable notice, and AIM shall cooperate and cause its employees, agents or
advisors to cooperate and cause its employees, agents or advisors to cooperate
with ACE Cap Re in conducting such reviews, inspections and audits.


 


C.    The ownership of all books, supplies, records or other materials
furnished by AIM on behalf of ACE Cap Re and all books, records or other
materials relating to the business of ACE Cap Re shall be vested in, and remain
the property of ACE Cap Re, and all shall be delivered to ACE Cap Re
immediately upon the termination or cancellation of this Agreement or at any
time upon the request of ACE Cap Re.


 


ARTICLE 7

GENERAL PROVISIONS


 


A.    Independent Contractor.  It
is expressly agreed by the Parties hereto that AIM is at all times acting and
performing hereunder as an independent contractor and not as agent for ACE Cap
Re, and that no act of commission or omissions of either party hereto shall be
construed to make or render AIM the principal, agent, employer, employee, joint
venturer, or associate of ACE Cap Re, except to the extent specified herein.


 


B.    Licenses and Qualified Staff. 
During the Term of the Agreement, AIM shall maintain all licenses and
permits required in connection with the performance of its obligations under
this Agreement and provide appropriate staff, without being required to
maintain any specific current employee.


 


C.    Headings.  The headings and captions of the several
sections of this Agreement are inserted solely for convenience of reference,
and are neither a part of nor intended to govern limit or aid in the
construction of any term or provision hereof.


 


D.    Force Majeure.  Neither Party shall be
responsible for delays or failures in performance resulting from acts beyond
the control of such part.  Such acts
shall include but are not limited to acts of God, strikes, lockouts, riots,
acts of war, embargoes, epidemics, government regulations superimposed after
the fact, fire, floods, communication line failures, power failures, typhoons,
earthquakes, or other disasters.


 


E.     Notices


 


1.     Each notice which is or may be required to be given by either party to
the other party in connection with this Agreement shall be in writing, and
given by facsimile, personal delivery, courier, or by certified mail, return
receipt requested, prepaid and properly addressed to the party to be served.


 


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Such notices, if to AIM, shall be addressed as follows:


 


Ace Insurance Management Ltd.


Attention: General Counsel


The ACE Building


30 Woodbourne Avenue


Hamilton HM 08


Bermuda


Telephone: 
441-295-5200


Facsimile: 
441-296-7797


 


Such notices, if to ACE Cap Re, shall be addressed as follows:


 


ACE Capital Re International Ltd.


Attention: Legal Counsel


Victoria Hall, 3rd Floor


Hamilton HM 11


Bermuda


Facsimile:


 


2.     Notices shall be effective on the date sent via facsimile, the date
delivered personally or by receipted delivery service, or three (3) days after
the date mailed, to the address indicated in Section 1 above.


 


3.     Each party may designate by notice to the other in writing, given in
the foregoing manner, a new address to which any notice may thereafter be so
given, served or sent.


 


F.     Confidentiality.  AIM acknowledges that, in
performance of its obligations hereunder, it shall receive certain information,
which is considered proprietary and confidential
by ACE Cap Re.  AIM agrees that it shall
treat all information received from ACE Cap Re pursuant to this Agreement with
the same degree of care and level of confidentiality that it affords its own
information.


 


G.    Entire Agreement; Amendments; Waiver.  This
Agreement constitutes and sets forth the entire agreement and understanding of
the parties pertaining to the subject matter hereof.  No supplement, modification, termination in whole or in part, or
waiver of this Agreement shall be binding unless executed in writing by the
party to be bound thereby.  No waiver of
any of the provisions of this Agreement shall be deemed, nor shall constitute,
a waiver of any other provisions hereof (whether or not similar), nor shall any
such waiver constitute a continuing waiver unless otherwise expressly provided
therein.


 


H.    Binding Effect; Assignment.  This
Agreement shall be binding upon and shall inure to the benefit of the Parties
hereto and each of their respective successors and permitted assigns, but may
not be assigned by either party without the prior written consent of the other
party (such consent not to be unreasonably withheld or delayed), and no other
persons shall have or derive any right, benefit or obligation hereunder.


 


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I.      Governing Law and Arbitration.  This Agreement shall be governed by and construed in accordance with
the laws of the Islands of Bermuda applicable to agreements made to be
performed entirely within such jurisdiction. 
Any dispute related to this Agreement shall be subject to final and
binding arbitration in Bermuda in accordance with the Arbitration Act 1986.


 


J.     Counterparts.  This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original, but all of which taken
together shall be considered one and the same instrument.


 


 


IN WITNESS WHEREOF, the duly authorized
representatives of the Parties have executed this Agreement on the date first
above written.


 


 


	
  ACE
  Insurance Management Ltd.

  	
  ACE Capital Re
  International Ltd.

  
	
   

  	
   

  
	
   

  	
   

  
	
  /s/ Keith P White

  	
   

  	
  /s/ Jonathan Beck

  	
   

  
	
   

  	
   

  
	
  By:

  	
  Keith P White

  	
   

  	
  By:

  	
  JONATHAN BECK

  	
   

  
	
  Title:

  	
  Chief Administration
  Officer

  	
   

  	
  Title:

  	
  VICE PRESIDENT

  	
   

  
								



 


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