Common use of Offset and Recoupment Rights Clause in Contracts

Offset and Recoupment Rights. Except as otherwise provided under Applicable Law, any undisputed debits or credits incurred in favor of or against either the Ceding Company or the Reinsurer under or with respect to this Agreement are deemed mutual debits or credits and may be set off and recouped, and only the net balance shall be allowed or paid, regardless of any insolvency, rehabilitation, conservatorship or comparable proceeding by or against the Ceding Company or the Reinsurer. Such right shall apply to the full extent permitted under the laws of the state of domicile of the insolvent party. Notwithstanding anything to the contrary set forth herein, each Party acknowledges and agrees that it shall have no right hereunder or pursuant to Applicable Law to offset or recoup any amounts due or owing (or to become due or owing) to the other Party under this Agreement against any amounts due or owing by such other Party or any of its Affiliates under the other Transaction Agreements or any other agreement, contract or understanding. Certain Reports from the Reinsurer. For so long as the Administrative Services Agreement remains in effect, the Reinsurer shall provide to the Ceding Company periodic accounting and other reports with respect to the Reinsured Contracts as specified in the Administrative Services Agreement. Except as otherwise set forth herein or in the Administrative Services Agreement, settlement with respect to amounts owed hereunder by the Reinsurer to the Ceding Company and by the Ceding Company to the Reinsurer shall be performed through the direct payment by the Reinsurer of the Reinsured Liabilities and direct receipt by the Reinsurer of the Additional Reinsurance Consideration on an ongoing basis in its capacity as Administrator under the Administrative Services Agreement. At each Capital Reporting Deadline that pertains to a calendar year end, the Reinsurer shall provide to the Ceding Company the RBC Ratio of the Reinsurer as of the last day of the calendar year. At each RBC Reporting Deadline that pertains to a calendar quarter other than the calendar quarter ending on December 31, the Reinsurer shall provide to the Ceding Company (i) if the RBC Ratio is less than [REDACTED], the estimated amount of the RBC Ratio of the Reinsurer as of the last day of such calendar quarter, or (ii) if the RBC Ratio is equal to or more than [REDACTED] as of the last day of such calendar quarter, a notice stating that the Reinsurer’s RBC Ratio as of the last day of such calendar quarter was equal to or more than [REDACTED]. Each such calculation shall include reasonable supporting detail with respect to such calculation. The Reinsurer shall provide written notice to the Ceding Company of the occurrence of any Triggering Event or Recapture Event within four (4) Business Days after it becomes aware of such occurrence. In addition, the Reinsurer shall cooperate fully with the Ceding Company and promptly respond to the Ceding Company’s reasonable inquiries from time to time concerning the determination of whether a Triggering Event or Recapture Event has occurred or would have occurred if (i) the Reinsurer’s RBC Ratio were estimated as of the date of such inquiry and treated as though it were a calendar quarter end, or (ii) any applicable cure period were deemed to have expired as of the date of such inquiry. At the Ceding Company’s request, the Reinsurer shall provide the Ceding Company with (i) copies of its most recent annual and quarterly NAIC statutory financial statements and (ii) a copy of the most recent annual audited financial statements along with the audit report thereon. The Ceding Company shall maintain the confidentiality of each such statement or report, in each case, to the extent that such statement or report is not publicly available. Termination of Administrative Services Agreement. Following any termination of the Administrative Services Agreement, the following shall apply: The Ceding Company shall assume responsibility for the administration of the Reinsured Contracts and the Ceded Reinsurance Contracts. The Ceding Company shall have full authority to determine liability on any Reinsured Liabilities reinsured hereunder and may pay or settle such liabilities as it deems appropriate; provided that the Ceding Company acts in accordance with clauses (c) and (e) below. The Ceding Company shall administer the Reinsured Contracts and the Ceded Reinsurance Contracts (x) with the skill, diligence and expertise that would reasonably be expected from experienced and qualified personnel performing such duties in like circumstances, and in a manner materially consistent with the skill, diligence and expertise maintained by the Ceding Company in its administration of analogous contracts for its own account, and (y) in accordance with (1) Applicable Law, (2) the terms and conditions of the Reinsured Contracts and the Ceded Reinsurance Contracts and (3) applicable industry standards. Unless such termination results from a recapture pursuant to Section 7.3, the Reinsurer shall reimburse the Ceding Company for (i) the Ceding Company’s reasonable and documented out-of-pocket costs of the administration and other activities under this Section 3.8, and (ii) in the event that the Ceding Company elects to internally administer the Reinsured Contracts and the Ceded Reinsurance Contracts, then the Administrator shall also reimburse the Ceding Company for the Ceding Company’s reasonable internal costs directly relating to such administration and other activities under this Section 3.8. The Ceding Company shall timely provide to the Reinsurer, or cause its administrators to so provide: within fifteen (15) Business Days following the end of each calendar quarter during the term of this Agreement, a report on all Reinsured Contracts and Ceded Reinsurance Contracts for such calendar quarter, including all cash flows thereunder, the information set forth on Schedule G and detailed calculations of all amounts due the Parties hereunder for such calendar quarter (the “Accounting Report”); for each calendar quarter, such reports, data and summaries (and, upon request of the Reinsurer, reasonable supporting records) related to the Reinsured Contracts, claims thereunder and Ceded Reinsurance as may be reasonably required for use in connection with the preparation of the Reinsurer’s statutory and GAAP financial statements, tax returns and other financial reports and to comply with the requirements of the Governmental Authorities having jurisdiction over the Reinsurer; for each calendar quarter, sufficient data to permit the Reinsurer to calculate its statutory and GAAP reserves in connection with the Reinsured Contracts and claims thereunder as of the quarter end; and such other information as reasonably requested by the Reinsurer.