1. (1) Any state-chartered financial institution entering into an agreement with an electronic data processing (EDP) servicer shall notify the commissioner in writing within at least thirty (30) days prior to entering into such agreement. The commissioner may for good cause disapprove the financial institution’s choice of servicer upon written notice to the institution before the expiration of the thirty (30) days. The commissioner’s failure to either approve or disapprove the servicer within the thirty (30) days shall be deemed approval or the servicer.
2. (2) Any state-chartered financial institution which desires to discontinue service with an electronic data processing (EDP) servicer and begin to perform this function in-house shall notify the commissioner in writing thirty (30) days prior to discontinuing the outside EDP service.
3. (3) Any state-chartered financial institution entering into an agreement with an electronic data processing (EDP) servicer shall execute a written agreement with such servicer which shall include the following or similar language approved by the commissioner: AGREEMENT This AGREEMENT entered into as of the _______ day of _________________, 19_____, between _________________________________________________, hereafter referred to as __________ and ___________ (financial institution) the provider of Data Processing Services, hereafter referred to as the Servicer. WITNESSETH WHEREAS, the financial institution is a state chartered financial institution operating under the laws of the State of Tennessee and subject to the jurisdiction of the Commissioner of Financial Institutions, State of Tennessee; and WHEREAS, Servicer is a provider of Data Processing Services and desires to provide said services to the financial institution; and WHEREAS, Tennessee Code Annotated Section 45-2-616 provides that a financial institution chartered by the State of Tennessee may preserve its records with any person who agrees in writing to submit its operations to the examination of the Commissioner; NOW, THEREFORE, in consideration of the foregoing, the terms and conditions set forth herein and any other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties agree as follows: I The Servicer agrees that pursuant to Tennessee Code Annotated, Section 45-2-616, upon entering into a contract to provide data processing services to the financial institution it will subject itself to the law of the State of Tennessee and rules and regulations promulgated by the Department of Financial Institutions. This includes allowing the Commissioner of Financial Institutions or his agents to examine the operation of the data processing center and retain copies of the magnetic tapes containing records of the financial institution for a reasonable period of time. IN WITNESS WHEREOF, ___________________ and _________________ have caused this Agreement to (financial institution) (Servicer) be executed by their duly authorized officers as of the day and year first above written. (Financial Institution) BY: President AND CONTINGENCY PLANNING (Servicer) BY: President
4. (4) A copy of the written agreement by and between the serviced institution and the servicer shall be forwarded to the commissioner upon execution.

5. (5) At the time the electronic data processing servicer enters into such a written agreement with the financial institution, and at such other times as the Commissioner may require, the electronic data processing servicer shall also be required to provide information to the Department concerning its current status which shall include, among other things, the following information:

   1. (a) a current financial statement certified by any managing official of the servicer;
   2. (b) a list of all Tennessee state chartered financial institutions serviced by the servicer and the location of the data center from which such service is provided;
   3. (c) the number of employees of the servicer;
   4. (d) the location of the third party software escrow;
   5. (e) if the servicer provides processing, how back-up is provided;
   6. (f) a copy of the most current EDP audit; and
   7. (g) a listing of the servicer’s insurance, including the type, amount, and with whom the coverage is held.

Authority: T.C.A. §§ 45-1-107, 45-2-616, 45-3-801, 45-4-1001 and 45-5-501. Administrative History: Original rule filed February 19, 1985; effective May 14, 1985. Amendment filed August 29, 1989; effective November 29, 1989. Amendment filed July 13, 1992; effective October 25, 1992.