Common use of Layers Not Reinsured Clause in Contracts

Layers Not Reinsured. In addition to the retention described in paragraph 2, VFL's 25% net retention of risk shall also include any portion of risks, expenses and other benefits (e.g. in the case of the Ceded Reinsurance Contract identified as "VUL-102" in Schedule 1, the first $200,000) that is not subject to reinsurance under the Ceded Reinsurance Contracts. In consideration of such retention, VFL shall be entitled to payment, in addition to that specified in paragraph 2, that is equal to VFL's 25% net retention of risk retained under this paragraph 7 (expressed in aggregate risk dollars for all Policies ceded under the Ceded Reinsurance Contract(s) at issue) multiplied by the average reinsurance premium payable under the Ceded Reinsurance Contract(s) at issue per thousand dollars of net amount at risk for all Policies ceded under the Ceded Reinsurance Contract(s) at issue (e.g. in the case of the Ceded Reinsurance Contract identified as "VUL-102'' in Schedule 1, the average reinsurance premiums payable in respect of VUL-102). C:\NrPortbl\WO\JRAWERT\123951_8.DOC Please indicate your acknowledgement of and agreement to the terms of this letter agreement by signing below. Very truly yours, VALLEY FORGE LIFE INSURANCE COMPANY By: ___________________________________ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ Senior Vice President Acknowledged and Agreed: PHL VARIABLE INSURANCE COMPANY By: ____________________________________ ▇▇▇▇▇ ▇▇▇ President Please indicate your acknowledgement of and agreement to the terms of this letter agreement by signing below. Very truly yours, VALLEY FORGE LIFE INSURANCE COMPANY By: ____________________________ ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ Senior Vice President Acknowledged and Agreed: PHL VARIABLE INSURANCE COMPANY By: ___________________________________ ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ Senior Vice President VUL 1997 Pool: Capital Select Variable Universal Life (VUL-97) Treaty Effective 12/1/96 With each of: (a) Phoenix Home Life Mutual Insurance Company (assumed by novation by American Phoenix Life and Reassurance Company effective 7/1/97 and further assumed by novation by ERC Life Reinsurance Corporation effective 1/1/00) (b) Employers Reassurance Corporation (c) Munich American Reassurance Company (11/1/96 effective date) (d) The Lincoln National Life Insurance Company (e) Allianz Life Insurance Company of North America Dimension Series Pool: Dimension l Variable Universal Life-2000 (VUL-101)* Treaty Effective 6/1/2000 Dimension 2 Variable Universal Life (VUL-102)* Treaty Effective 2/2/2001 Dimension 3 Variable Universal Life (VUL-103)* Treaty Effective 2/2/2001 Dimension 4 Variable Universal Life (VUL-104)* Treaty Effective 2/2/2001 Dimension 5 Variable Universal Life (VUL-105)* Treaty Effective 2/2/2001 *In each case, with each of: (a) Employers Reassurance Corporation