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ANNEX B
COINSURANCE AGREEMENT
between
▇▇▇▇ ▇▇▇▇▇▇▇ MUTUAL LIFE INSURANCE COMPANY
and
UNICARE LIFE & HEALTH INSURANCE COMPANY
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TABLE OF CONTENTS
Page
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ARTICLE I. DEFINITIONS ...............................................
ARTICLE II. REINSURANCE CLOSING; CONDITIONS TO REINSURANCE CLOSING ....
2.1 Reinsurance Closing ................................................
2.2 Conditions to Reinsurance Closing ..................................
ARTICLE III. COINSURED POLICIES ........................................
3.1 Coinsured Policies .................................................
3.2 Liability of Reinsurer ............................................. 10
3.3 Regulatory Filings and Approvals ...................................
ARTICLE IV. GBO EXCLUDED BUSINESS .....................................
4.1 Coinsurance Agreement Inapplicable to GBO Excluded Business ........
4.2 Company's Indemnification for GBO Excluded Business ................
ARTICLE V. EXISTING GBO POLICIES .....................................
5.1 Reinsurance of Existing GBO Policies at Effective Time .............
5.2 Value of Reserves .................................................. 11
5.3 Reinsurer's Indemnification for Existing GBO Policies ..............
5.4 Company's Indemnification for Existing GBO Policies ................
ARTICLE VI. TRANSITION GBO POLICIES ................................... 12
6.1 Issuance of Transition GBO Policies by the Company .................
6.2 Reinsurance of Transition GBO Policies .............................
6.3 Reinsurer's Indemnification for Transition GBO Policies.............
6.4 Company's Indemnification for Transition GBO Policies .............. 13
6.5 Maintenance of Licenses
6.6 Limitations on Writing of Transition GBO Policies
ARTICLE VII. GENERAL PROVISIONS ........................................ 15
7.1 Reinsurer's Recordation of Liabilities ........................... 15
7.2 Administration ................................................... 15
7.3 Authorized Representatives ....................................... 15
ANNEX B
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7.4 Maintenance and Inspection of Records ..............................
7.5 Misunderstandings and Oversights ................................... 16
7.6 Age, Sex and Other Adjustments ..................................... 16
7.7 Reinstatements ..................................................... 16
7.8 Contract Changes or Reserve Assumption Changes .....................
7.9 Litigation ......................................................... 17
ARTICLE VIII. CONSIDERATION FOR REINSURANCE AND POLICY PREMIUMS ......... 17
8.1 Assets to be Transferred at Effective Time ......................... 17
8.2 Transition GBO Policies ............................................
8.3 Policy Premiums and Other Amounts...................................
ARTICLE IX. BENEFITS AND OTHER PAYMENTS BY REINSURER .................. 18
9.1 Benefits ........................................................... 18
9.2 Claims ............................................................. 18
9.3 Claims Payments .................................................... 18
9.4 Remittance of Third Party Reinsurance .............................. 20
9.5 Allowance for Commissions and Expenses .............................
9.6 Experience Rating Refunds ..........................................
ARTICLE X. DUTY OF COOPERATION ....................................... 20
10.1 Duty of Cooperation ...............................................
ARTICLE XI. ACCOUNTING AND SETTLEMENT ................................. 20
11.1 Remittances ....................................................... 20
11.2 Quarterly Report .................................................. 20
11.3 Amounts Due Either Party .......................................... 20
11.4 Interest on Delayed Payments ...................................... 21
ARTICLE XII. DURATION AND TERRITORY .................................... 21
12.1 Duration .......................................................... 21
12.2 Reinsurer's Liability ............................................. 21
12.3 Territory ......................................................... 21
ARTICLE XIII. INSOLVENCY ................................................ 21
13.1 Payments by Reinsurer ............................................. 21
13.2 Claims ............................................................ 22
ARTICLE XIV. ARBITRATION ............................................... 22
14.1 General ........................................................... 22
ARTICLE XV. INDEMNIFICATION ........................................... 22
15.1 The Reinsurer ..................................................... 22
15.2 The Company ....................................................... 23
15.3 Indemnification Procedures ........................................ 23
15.4 Survival of Article ............................................... 23
ANNEX B
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ARTICLE XVI. MISCELLANEOUS PROVISIONS .................................. 24
16.1 No Third Party Beneficiaries ...................................... 24
16.2 Headings and Exhibit .............................................. 24
16.3 Notices ........................................................... 24
16.4 Severability ...................................................... 25
16.5 Assignment ........................................................ 26
16.6 Successors and Assigns ............................................ 26
16.7 Execution in Counterparts ......................................... 26
16.8 Amendments ........................................................ 26
16.9 Waiver ............................................................ 26
16.10 Interpretation .................................................... 26
16.11 Entire Agreement .................................................. 26
16.12 Governing Law ..................................................... 26
EXHIBIT A QUARTERLY/ANNUAL REPORT
ANNEX B
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COINSURANCE AGREEMENT
This Coinsurance Agreement (the "Coinsurance Agreement") is
made and entered into as of the Effective Time (as hereinafter defined), between
▇▇▇▇ ▇▇▇▇▇▇▇ MUTUAL LIFE INSURANCE COMPANY, a mutual life insurance company
organized under the laws of Massachusetts (the "Company"), and UNICARE LIFE &
HEALTH INSURANCE COMPANY, a stock life insurance company organized under the
laws of Delaware (the "Reinsurer").
WHEREAS, the Company and WellPoint Health Networks Inc., a
California corporation ("WellPoint") and the indirect parent of the Reinsurer,
have entered into a Purchase and Sale Agreement, dated as of October 10, 1996
(the "Purchase Agreement"), which provides for the sale by the Company to
WellPoint and the Reinsurer of the GBO Included Business (as hereinafter
defined); and
WHEREAS, to effect such sale of the GBO Included Business, the
Purchase Agreement provides for, among other things, the sale and transfer by
the Company to WellPoint or the Reinsurer of the GBO Division Assets (as
hereinafter defined) and the assignment by the Company, and assumption by
WellPoint or the Reinsurer, of the GBO Division Liabilities (as hereinafter
defined), as well as the sale by ▇▇▇▇ ▇▇▇▇▇▇▇ Subsidiaries, Inc., a wholly-owned
subsidiary of the Company, of the GBO Subsidiary Shares (as hereinafter defined)
to WellPoint; and
WHEREAS, certain of the GBO Division Assets are to be sold and
transferred by the Company to the Reinsurer, and certain of the GBO Division
Liabilities are to be assigned by the Company and assumed by the Reinsurer,
under this Coinsurance Agreement; and
WHEREAS, the Company has agreed to cede to the Reinsurer, and
the Reinsurer has agreed to accept and indemnity reinsure, on a 100% coinsurance
basis, all of the Reserves and Liabilities (as hereinafter defined) arising
under or with respect to the Coinsured Policies (as hereinafter defined) as
contemplated by the Purchase Agreement and this Coinsurance Agreement; and
WHEREAS, the Reinsurer has agreed to perform administrative
services with respect to the Coinsured Policies pursuant to an administration
agreement (the "Administration Agreement") entered into between the Company and
the Reinsurer as of the Effective Time; and
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WHEREAS, the Company and the Reinsurer are simultaneously
entering into an Assumption Agreement (the "Assumption Agreement"), under which
Reinsurer may, in its sole discretion, assumption reinsure such Coinsured
Policies, with a concurrent novation and complete release of the Company from
any liability under such Coinsured Policies, on a state by state basis after the
Effective Time upon the receipt of any and all applicable regulatory approvals
and notice to relevant policyholders followed by expiration of the applicable
period with no opt out by such policyholders or the obtaining of required
consents from such policyholders, as the case may be.
NOW, THEREFORE, in consideration of the foregoing and the
mutual agreements set forth herein, the Company and the Reinsurer mutually agree
as follows:
ARTICLE I.
DEFINITIONS
As used in this Coinsurance Agreement, the following
capitalized terms shall have the following meanings (definitions are applicable
to both the singular and the plural forms of each term defined in this
Article I):
"Accounting Period" means a calendar quarter, except that the
first Accounting Period shall be the period commencing with the Effective Time
and ending with the last day of then current calendar quarter, and the final
Accounting Period shall be the period commencing with the first day of the
calendar quarter that includes the day on which the Company's liability under
the last Coinsured Policy either terminates or is novated, and ending on such
day.
"Administration Agreement" shall have the meaning set
forth in the fifth recital hereof.
"Affiliate" of a specified Person means a Person that (at the
time when the determination is to be made) directly, or indirectly through one
or more intermediaries, controls, or is controlled by, or is under common
control with, the specified Person. As used in the foregoing sentence, the terms
"control" (including, with correlative meaning, the terms "controlling,"
"controlled by" and "under common control with") means the possession, directly
or indirectly, of the power to direct or cause the direction of the management
and policies of a Person, whether through the ownership of voting securities, by
contract
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or otherwise.
"ASO Contract" means a Contract issued by the Company pursuant
to which the Company provides only administrative services to customers of the
GBO Business.
"Assumption Agreement" shall have the meaning set forth
in the sixth recital hereof.
"Benefits" shall have the meaning set forth in Section
9.1 hereof.
"Business Day" means any day (other than a Saturday or Sunday)
on which banks are permitted to be open and transact business in Boston,
Massachusetts and Los Angeles, California.
"Closing GAAP Balance Sheet" shall have the meaning set forth
in Section 1.5(a) of the Purchase Agreement.
"Coinsured Policies" means the Existing GBO Policies
and the Transition GBO Policies.
"Commissions" means all sales commissions, production bonuses
or other payments in cash or kind payable to agents in the ordinary course of
business with respect to the origination or renewal of any Coinsured Policies.
"Contracts" means all agreements or contracts, including,
without limitation, all ASO Contracts, reinsurance agreements, coinsurance
agreements, pooling agreements, network agreements, agents', brokers' and other
intermediaries' agreements, mortgages, indentures, notes, guarantees, leases,
purchase agreements and sale agreements.
"Effective Time" shall have the meaning set forth in
Section 2.1 hereof.
"Existing GBO Policies" means all GBO Business Policies other
than GBO Excluded Business Policies issued by the Company before the Effective
Time which are in effect on the Effective Time and such GBO Business Policies
not in effect on the Effective Time, for which Reserves have been established on
the Closing GAAP Balance Sheet, which will be coinsured by Reinsurer at the
Effective Time (but excluding all coverages other than life, accidental death
and dismemberment, survivor income benefits, long-term disability and short-term
disability coverages which expired more than three (3) years prior to the
Effective Time and which are part of the GBO Included Business) pursuant to this
Coinsurance Agreement.
"Extra Contractual Obligations" means (i) liabilities which
arise from negligence or bad faith in claims practices with
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respect to Coinsured Policies, or (ii) liabilities for loss in excess of the
limit of the Company's original policy applicable to any Coinsured Policy.
Notwithstanding the foregoing, the Reinsurer shall have no liability for any
Extra Contractual Obligations to the extent they arise out of or are based on
bad faith claims practices, willful misconduct, fraud or gross negligence of the
Company or its Affiliates (without attributing to the Company or its Affiliates
the actions of the Reinsurer or its Affiliates).
"GBO Business" means the United States, Puerto Rico and Guam
group benefit operations of the Company, including the ASO Contracts business,
the group health, group dental, group vision, group long-term disability, group
short-term disability, group accident and sickness, and group pharmacy business,
the business conducted by the GBO Subsidiaries, network arrangements, group life
businesses, group accidental death and dismemberment business, individual
accident and health converted business and individual life converted business,
but excluding the business conducted by HealthPlan Management Services, Inc.,
long-term care insurance, group creditor insurance and all insurance business
written outside of the United States by the International Group Program business
unit of the Company either directly by the Company or through ▇▇▇▇ ▇▇▇▇▇▇▇
Services Internacionais S/C Limitada, ▇▇▇▇ ▇▇▇▇▇▇▇ International Services, S.A.
and ▇▇▇▇ ▇▇▇▇▇▇▇ International Services Pte, Ltd., by the Maritime Life
Assurance Company, by P.T Asuransi Jiwa Bumiputera ▇▇▇▇ ▇▇▇▇▇▇▇, by P.T. Indras
Insan Jaya Utama, by ▇▇▇▇ ▇▇▇▇▇▇▇ Life Insurance (Malaysia) Berhad, by ▇▇▇▇
▇▇▇▇▇▇▇ Life Assurance Company, Ltd., and by The Interlife Assurance Public
Company Ltd. or otherwise by the Company or any of its Affiliates.
"GBO Business Policies" means all Insurance Policies issued in
the United States, Puerto Rico or Guam by the Company as part of the GBO
Business.
"GBO Division Assets" means the GBO Included Assets held
directly by the Company.
"GBO Division Liabilities" means the GBO Included Liabilities
which are direct obligations of the Company.
"GBO Excluded Business" means (i) all group life insurance
business and/or group accidental death and dismemberment business constituting
part of the GBO Business engaged in directly by the Company ("Life or ADD") but
issued to clients of the GBO
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Business who are not also clients of the GBO Business with respect to ASO
Contracts business, group health, group dental, group vision, group long-term
disability, group short-term disability, group accident and sickness, group
pharmacy or network arrangements business engaged in directly by the Company
("Accident and Health") provided, however, that notwithstanding the foregoing,
the following shall constitute GBO Excluded Business:
(w) any Life or ADD policy which after June 30, 1996 and prior to
the date of the Purchase Agreement is sold to or committed to
a client (and disclosed to WellPoint) which was an Accident
and Health client of the GBO Business as of June 30, 1996,
regardless as to when such Life or ADD policy is actually
effective, executed or delivered;
(x) any Life or ADD policy which became effective prior to July 1,
1996 with respect to a client which subsequent to June 30,
1996 and prior to the Effective Time becomes an Accident and
Health client of the GBO Business;
(y) all guaranteed access accounts constituting part of the GBO
Business, other than such accounts affiliated with the
Company, Ford Motor Company and Digital Equipment Corporation;
and
(z) all supplementary contracts without life contingencies
constituting part of the GBO Business, other than such
contracts with Ford Motor Company; and
(ii) all individual life converted insurance policies issued prior to
the Effective Time relating to or arising from the GBO Business.
"GBO Excluded Business Policies" means all Insurance Policies
constituting part of the GBO Excluded Business.
"GBO Included Assets" means all right, title and interest in
and to (i) every species of property other than cash and Investment Assets,
real, personal and mixed, tangible and intangible, used primarily or exclusively
in the conduct of the GBO Included Business as of the Effective Time with such
modifications and adjustments as are set forth in Section 1.1(a) of the Purchase
Agreement, and the rights under all GBO Included Contracts as of the Effective
Time, and (ii) such amount of cash
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and Investment Assets as are required to be transferred from the Company to
WellPoint and/or the Reinsurer under Section 8.1 of this Coinsurance Agreement
and Section 1.5 of the Purchase Agreement.
"GBO Included Business" means the GBO Business other than the
GBO Excluded Business.
"GBO Included Contract" means a Contract relating primarily or
exclusively to the GBO Included Business and to which the Company or one of the
GBO Subsidiaries is a party and which is in effect as of the Effective Time.
"GBO Included Liabilities" means those liabilities and
obligations of the Company and the GBO Subsidiaries under the GBO Included
Contracts and those liabilities and obligations as of the Effective Time of the
GBO Included Business for which, in accordance with the Company's past
accounting practices and procedures, amounts would be included within the
categories of liabilities identified on the Form of Closing GAAP Balance Sheet,
with such modification and adjustments as are set forth in Section 1.1(a) of the
Purchase Agreement. All of the GBO Included Liabilities shall have been incurred
by the Company or the GBO Subsidiaries, as the case may be, in the ordinary
course of business and shall be within the categories reflected in the Closing
GAAP Balance Sheet.
"GBO Subsidiaries" means Cost Care, Inc., TriState, Inc. and
▇▇▇▇▇▇▇ Association Services Group, Inc.
"GBO Subsidiary Shares" means all of the capital stock of
Cost Care, Inc. and ▇▇▇▇▇▇▇ Association Services Group, Inc., and the 60% of
the capital stock of TriState, Inc. owned by ▇▇▇▇ ▇▇▇▇▇▇▇ Subsidiaries, Inc.
"Insurance Policies" means all insurance policies, contracts,
binders or certificates of insurance (including certificates issued with respect
to group insurance policies), and all riders, endorsements and amendments
thereto.
"Investment Assets" means United States treasury securities or
publicly traded bonds of United States corporations rated NAIC Category 1 or 2
by the Securities Valuation Office of the National Association of Insurance
Commissioners.
"Permitted Jurisdictions" means the fifty states of the United
States, the District of Columbia, Puerto Rico and Guam.
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"Person" means any corporation, individual, joint stock
company, joint venture, partnership, unincorporated association, governmental
regulatory entity, country, state or political subdivision thereof, trust or
other entity.
"Policyholder" means a holder of a Coinsured Policy.
"Purchase Agreement" shall have the meaning set forth in the
first recital hereof.
"Quarterly Report" shall have the meaning set forth in
Section 11.2 hereof.
"Reinsurance Closing" shall have the meaning set forth
in Section 2.1 hereof.
"Reinsurance Closing Date" shall have the meaning set forth in
Section 2.1 hereof.
"Reserves" means the Company's reserves computed as of a
specified date and relating to the Company's business with respect to the
Coinsured Policies for all amounts of (i) unearned premiums and (ii) all losses
and all loss adjustment expenses, net of Third Party Reinsurance, calculated
under SAP and as would be described in the Company's Statutory Annual Statement
on exhibits 8, 9, 10 or 11 (or any other exhibit then applicable) to such Annual
Statement of "Liabilities, Surplus and Other Funds" as if such Annual Statement
were being filed as of such specified date.
"Reserves and Liabilities" means all of the Reserves and other
liabilities and associated rights and obligations arising under the Coinsured
Policies including, but not limited to, liabilities for Benefits, surrenders,
returns and premium refunds, but excluding liabilities for guaranty fund
assessments and taxes that arise from or relate to the Existing GBO Policies and
are incurred during the period ending with the Effective Time.
"SAP" means statutory accounting practices prescribed or
permitted by the Insurance Department of the Commonwealth of Massachusetts for
the preparation of annual and quarterly statements by life insurance companies.
"Service Agreement" means the Service Agreement entered into
by the Company, as service provider, and Reinsurer as of the Effective Time.
"Third Party Reinsurance" shall mean all contracts of
reinsurance with The Maritime Life Assurance Company and with independent
parties unaffiliated with the Company or any of its
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Affiliates under which the Company's Reserves and Liabilities with respect to
the Coinsured Policies or some portion thereof are transferred, whether or not
such contracts of reinsurance are also applicable to business other than the
Coinsured Policies.
"Transition GBO Policies" means all GBO Business Policies that
are issued or renewed by the Company after the Effective Time and coinsured by
the Reinsurer pursuant to Article VI hereof.
"Transition Termination Date" means, with respect to Coinsured
Policies in each Permitted Jurisdiction, the earliest of (i) ninety (90) days
after the date that Reinsurer has obtained all licenses and form and rate
approvals necessary to write all of the GBO Business Policies other than group
life insurance policies and group accidental death and dismemberment insurance
policies in such jurisdiction, (ii) the date of consummation of assumption
reinsurance of, and novation by the Company with respect to, all Coinsured
Policies in such jurisdiction, and (iii) twenty-four (24) months from the
Reinsurance Closing Date with respect to group life, group accidental death and
dismemberment, long-term disability and survivor income Coinsured Policies, and
thirty (30) months from the date of the Reinsurance Closing Date with respect to
all other Coinsured Policies.
ARTICLE II.
REINSURANCE CLOSING; CONDITIONS TO REINSURANCE CLOSING
2.1 Reinsurance Closing. The closing hereunder for the
reinsurance of the Existing GBO Policies (the "Reinsurance Closing") shall take
place upon the date of satisfaction of the conditions set forth in Section 2.2
below at the offices of ▇▇▇▇▇▇ & ▇▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇
▇▇▇▇▇ unless the parties shall have agreed in writing to another date (such date
being hereinafter referred to as the "Reinsurance Closing Date"). This
Coinsurance Agreement shall become effective as of 12:01 A.M. Eastern Time on
the Reinsurance Closing Date (the "Effective Time") or such other time and date
as may be agreed by the parties hereto.
2.2 Conditions to Reinsurance Closing. The consummation of the
transactions contemplated under this Coinsurance Agreement on the Reinsurance
Closing Date and the related obligations of the Company and the Reinsurer with
respect
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thereto are subject to the prior satisfaction of the following conditions,
unless waived in writing by both the Company and the Reinsurer:
(a) the Purchase Agreement shall have been executed and delivered by
the Company and WellPoint.
(b) the Administration Agreement shall have been executed and delivered
by the Company and the Reinsurer, as service provider; and
(c) the Service Agreement shall have been executed and delivered by the
Company, as service provider, and the Reinsurer; and
(d) the Assumption Agreement shall have been executed and delivered by
the Company and the Reinsurer; and
(e) consummation of all other transactions contemplated under the
Purchase Agreement, excluding those transactions contemplated under the
Assumption Agreement to be consummated after the Reinsurance Closing Date, but
including, without limitation, payment by the Reinsurer of the Purchase Price as
required by Section 1.1(b) of the Purchase Agreement, the transfer of all of the
GBO Division Assets and GBO Division Liabilities required to be transferred at
the closing under the Purchase Agreement and not transferred under this
Coinsurance Agreement, as well as the sale of the GBO Subsidiary Shares and the
receipt by the Company or the Reinsurer, as the case may be, of any and all
governmental approvals necessary for the consummation of the transactions
contemplated under this Coinsurance Agreement and the Purchase Agreement.
ARTICLE III.
COINSURED POLICIES
3.1 Coinsured Policies.
(a) From and after the Effective Time, the Company hereby
cedes and the Reinsurer hereby assumes on the terms and conditions and for the
considerations hereinafter contained, a 100% coinsurance share of the Company's
Reserves and Liabilities, after reduction for Third Party Reinsurance, with
respect to Existing GBO Policies and Transition GBO Policies to be issued or
entered into by the Company in the future pursuant to this Article III,
paragraph (c) and Article VI, but excluding (i) the
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GBO Excluded Business Policies and (ii) liabilities to the extent arising out
of, based upon or relating to bad faith claims practices, willful misconduct,
fraud or gross negligence of the Company or its Affiliates (without attributing
to the Company or its Affiliates the actions of the Reinsurer or its
Affiliates).
(b) It is understood and agreed that the portion of the
Coinsured Policies consisting of the Existing GBO Policies shall be ceded by the
Company and reinsured by the Reinsurer in accordance with the terms, conditions
and limitations specified in Article V herein.
(c) It is further understood and agreed that the portion of
the Coinsured Policies consisting of the Transition GBO Policies shall be issued
and automatically and immediately thereupon ceded by the Company and reinsured
by the Reinsurer in accordance with the terms, conditions and limitations
specified in Article VI herein.
3.2 Liability of Reinsurer. The liability of the Reinsurer
with respect to each cession shall commence obligatorily and simultaneously with
that of the Company according to the terms, conditions and limitations
hereinafter set forth. The Reinsurer shall benefit from all reductions of losses
by compromise, Third Party Reinsurance or otherwise.
3.3 Regulatory Filings and Approvals. The Company and the
Reinsurer agree to cooperate in good faith and use their commercially reasonable
efforts to make all necessary insurance regulatory filings and to obtain all
insurance regulatory approvals required for the consummation of the transactions
contemplated by this Coinsurance Agreement.
ARTICLE IV.
GBO EXCLUDED BUSINESS
4.1 Coinsurance Agreement Inapplicable to GBO Excluded
Business. This Coinsurance Agreement does not apply to and specifically excludes
the GBO Excluded Business. The Company shall retain any and all liabilities and
risks with respect to the GBO Excluded Business Policies, and all profit, loss
or expense from the GBO Excluded Business shall be for the account of the
Company.
4.2 Company's Indemnification for GBO Excluded Business. The
Company shall assume and indemnify fully the Reinsurer and its Affiliates for
any and all damages, costs and
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expenses, including reasonable attorneys' fees and disbursements, arising out
of, based upon or relating to the GBO Excluded Business.
ARTICLE V.
EXISTING GBO POLICIES
5.1 Reinsurance of Existing GBO Policies at Effective Time.
Effective as of the Effective Time, the Company shall cede, and the Reinsurer
shall accept, on a 100% coinsurance basis, all of the Company's Reserves and
Liabilities, and all risks, past, present and future, except as otherwise
provided herein, with respect to the Existing GBO Policies, after reduction for
Third Party Reinsurance.
5.2 Value of Reserves. The value of the Company's Reserves as
of the Effective Time with respect to the Existing GBO Policies shall be
established by the Closing GAAP Balance Sheet audited by Coopers & ▇▇▇▇▇▇▇,
pursuant to the terms and conditions set forth in Section 1.5 of the Purchase
Agreement.
5.3 Reinsurer's Indemnification for Existing GBO Policies. The
Reinsurer shall assume and indemnify fully the Company for any and all damages,
costs and expenses, including reasonable attorneys' fees and disbursements,
arising out of, based upon or relating to the Existing GBO Policies so
transferred to the Reinsurer as of the Effective Time under this Coinsurance
Agreement, including, without limitation, liabilities for Extra Contractual
Obligations; provided, however, that the Reinsurer shall have no obligation to
indemnify hereunder for liabilities to the extent such damages, costs and
expenses arise out of, are based on or are related to any bad faith claims
practices, willful misconduct, fraud or gross negligence of the Company or its
Affiliates (without attributing to the Company or its Affiliates the actions of
the Reinsurer or its Affiliates).
5.4 Company's Indemnification for Existing GBO Policies. The
Company shall assume and indemnify fully the Reinsurer for any and all damages,
costs and expenses, including reasonable attorneys' fees and disbursements,
arising out of, based upon or relating to the Existing GBO Policies to the
extent such damages, costs and expenses arise out of or are based on any bad
faith claims practices, willful misconduct, fraud or gross negligence of the
Company or its Affiliates (without attributing to the Company or its Affiliates
the actions of the Reinsurer or
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its Affiliates).
ARTICLE VI.
TRANSITION GBO POLICIES
6.1 Issuance of Transition GBO Policies by the Company.
Subject to the limitations contained in Section 6.6 hereof, the Company shall be
obligated to issue Transition GBO Policies in the Permitted Jurisdictions
consisting of GBO Business Policies that are (i) GBO Business Policies issued to
Persons that are not Policyholders as of the Effective Time excluding group term
life insurance policies and group accidental death and dismemberment policies;
provided, however, that no such new GBO Business Policies shall be issued in
Puerto Rico or Guam, (ii) renewal GBO Business Policies (including but not
limited to those required to be issued by law) excluding renewals with respect
to the GBO Excluded Business, (iii) individual converted accident and health
policies issued pursuant to a group GBO Business Policy, and (iv) individual
converted life policies issued pursuant to a group GBO Business Policy other
than any group GBO Business Policy constituting part of the GBO Excluded
Business. The Company shall have no other obligations to issue new or renewal or
converted policies as Transition GBO Policies. In addition, any renewal or
converted policies issued by the Company as required by law after the applicable
Transition Termination Date arising directly or indirectly with respect to any
policy previously reinsured under this Coinsurance Agreement shall constitute
Transition GBO Policies and automatically and immediately be ceded under this
Coinsurance Agreement.
6.2 Reinsurance of Transition GBO Policies. The Company shall
cede and the Reinsurer shall accept, on a 100% coinsured basis, all of the
Company's Reserves and Liabilities, after reduction for Third Party Reinsurance,
if any, and all risks, past, present and future, except as otherwise provided
herein, with respect to the Transition GBO Policies. All Transition GBO Policies
shall be automatically and immediately ceded to the Reinsurer as of the date
such Transition GBO Policies are issued as provided herein.
6.3 Reinsurer's Indemnification for Transition GBO Policies.
The Reinsurer shall assume and indemnify fully the Company for any and all
damages, costs and expenses, including reasonable attorneys' fees and
disbursements, arising out of,
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based upon or relating to the Transition GBO Policies so transferred to the
Reinsurer under this Coinsurance Agreement, including, without limitation,
liabilities for Extra Contractual Obligations; provided, however, that the
Reinsurer shall have no obligation to indemnify hereunder for liabilities to the
extent they arise out of, are based on or are related to any bad faith claims
practices, willful misconduct, fraud or gross negligence of the Company or its
Affiliates (without attributing to the Company or its Affiliates the actions of
the Reinsurer or its Affiliates).
6.4. Company's Indemnification for Transition GBO Policies.
The Company shall assume and indemnify fully the Reinsurer for any and all
damages, costs and expenses, including reasonable attorneys' fees and
disbursements, arising out of, based upon or relating to the Transition GBO
Policies to the extent such damages, costs and expenses arise out of, are based
on or are related to any bad faith claims practices, willful misconduct, fraud
or gross negligence of the Company or its Affiliates (without attributing to the
Company or its Affiliates the actions of the Reinsurer or its Affiliates).
6.5 Maintenance of Licenses. The Company shall use its
commercially reasonable efforts to maintain its licenses and other approvals in
the Permitted Jurisdictions to the extent necessary to issue and cede the
Transition GBO Policies pursuant to the terms of this Coinsurance Agreement.
6.6 Limitations on Writing of Transition GBO Policies. Unless
otherwise agreed to by the parties hereto, the Company shall not be required to
issue and cede Transition GBO Policies in any amount in any jurisdiction after
the Transition Termination Date for that jurisdiction; except with respect to
any renewal or conversion policies issued by the Company as required by law
after the Transition Termination Date arising directly or indirectly with
respect to any Coinsured Policy previously reinsured under this Coinsurance
Agreement. Notwithstanding any other provision of this Coinsurance Agreement,
prior to the last Transition Termination Date, the Company shall not be required
to issue and cede (i) any Transition GBO Policies if upon issuance thereof the
original gross written premiums for the aggregate of all Transition GBO Policies
issued under this Coinsurance Agreement during the first year after the
Effective Time, determined in accordance with SAP,
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would exceed an amount equal to 125% of the original gross written premiums for
GBO Included Business during 1996, determined in accordance with SAP, (ii) any
Transition GBO Policies if upon issuance thereof the original gross written
premiums for the aggregate of all Transition GBO Policies issued under this
Coinsurance Agreement during the eighteen (18) months after the termination of
the first year after the Effective Time, determined in accordance with SAP,
would exceed an amount equal to 100% of the original gross written premiums for
GBO Included Business during 1996, determined in accordance with SAP, (iii) any
Transition GBO Policies at any time that the Delaware Insurance Department has
issued a corrective order regarding the risk based capital level of the
Reinsurer and the subject matter of such corrective order has gone uncured for a
period of thirty (30) consecutive days, (iv) any Transition GBO Policies to the
extent that any applicable law, regulation, rule or stated position of a
regulatory authority would prohibit the insurance or reinsurance of such
Transition GBO Policies as contemplated hereunde, or (v) any Transition GBO
Policies issued in a Permitted Jurisdiction, in the event that the Reinsurer's
certificate of authority to do business in such Permitted Jurisdiction has not
been obtained or has been revoked or suspended; provided, however, that the
Company shall issue and cede as Transition GBO Policies renewals of Existing GBO
Policies issued in Maine, New Hampshire, Guam and Puerto Rico. The Company and
the Reinsurer agree that upon the occurrence of any such event described in
clause (iv) of the first sentence of this Section, they will (y) use all
commercially reasonable efforts to construct an arrangement substantially
similar to the reinsurance of the Transition GBO Policies contemplated herein
which avoids the adverse consequences described in the immediately preceding
sentence, in form and substance and with such indemnities as shall be mutually
acceptable to the parties, or (z) use their respective commercially reasonable
efforts to effect as soon as reasonably practicable the complete transfer to the
Reinsurer of the Transition GBO Policies, and all other Coinsured Policies, with
respect to which any of the adverse effects described in the immediately
preceding sentence apply, together with a novation with respect to the Company
for all such Transition GBO Policies and other Coinsured Policies through
assumption reinsurance, cancellation and rewriting of insurance policies or
another
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arrangement mutually satisfactory to the parties.
ARTICLE VII.
GENERAL PROVISIONS
7.1 Reinsurer's Recordation of Liabilities. The Reinsurer
shall record all Reserves and Liabilities assumed under the terms of this
Coinsurance Agreement on its books and SAP financial statements in accordance
with SAP.
7.2 Administration. The Reinsurer, as service provider, shall
perform administration services with respect to the Coinsured Policies in
accordance with the terms and provisions of the Administration Agreement.
7.3 Authorized Representatives. The Company and the Reinsurer
shall each appoint from time to time one or more individuals who shall serve as
contact person(s) and authorized representative(s) of such party for the purpose
of carrying out this Coinsurance Agreement. Such representatives shall be
authorized to act on behalf of their respective parties as to matters pertaining
to this Coinsurance Agreement. Each party shall notify the other, in writing, as
to the name, address and telephone number for every such designated contact
person and authorized representative, and for every replacement thereof.
7.4 Maintenance and Inspection of Records. The Company shall
retain possession of all books, records, papers or any other documents relating
to the Coinsured Policies that are required by law to be retained in the
possession of the Company in segregated files, in an orderly and organized
condition and in its principal offices in Boston, Massachusetts. All other
books, records, papers and documents relating to the Coinsured Policies shall be
maintained by the Reinsurer, as service provider, pursuant to the terms and
conditions of the Administration Agreement. Each party and its designated
representatives shall have the right to inspect, review and copy the papers and
any and all other books or documents relating to the Coinsured Policies
maintained by the other party under this Coinsurance Agreement or the
Administration Agreement. The rights of the parties under this Section shall
survive termination of this Coinsurance Agreement.
7.5 Misunderstandings and Oversights. If any delay, omission,
error or failure to pay amounts due or to perform any other act required by this
Coinsurance Agreement is unintentional
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and caused by misunderstanding or oversight, the Company and the Reinsurer will
adjust the situation to what it would have been had the misunderstanding or
oversight not occurred. The party first discovering such misunderstanding or
oversight, or act resulting from the misunderstanding or oversight, will notify
the other party in writing promptly upon discovery thereof, and the parties
shall act to correct such misunderstanding or oversight within thirty (30)
Business Days of receipt of such notice. However, this Section shall not be
construed as a waiver by either party of its right to enforce strictly the terms
of this Coinsurance Agreement.
7.6 Age, Sex and Other Adjustments. If the Company's liability
under any of the Coinsured Policies is changed because of a misstatement of age
or sex or any other material fact, the Reinsurer's liability under such
Coinsured Policies shall be changed in an identical amount.
7.7 Reinstatements. If a Coinsured Policy that is or has been
reduced, terminated, or lapsed is reinstated while this Coinsurance Agreement is
in force, the reinsurance for such Coinsured Policy shall be reinstated
automatically to the amount that would be in force if the Coinsured Policy had
not been reduced, terminated, or lapsed. The Company will pay to the Reinsurer
in accordance with the Administration Agreement all amounts received by the
Company in connection with the reinstatement.
7.8 Contract Changes or Reserve Assumption Changes. The
Company shall not change (a) the terms and conditions of any Coinsured Policies,
or (b) the assumptions, including the statutory Reserve rate assumptions, used
by the Company to establish the Reserves and Liabilities with respect to such
Coinsured Policies without the prior written approval of the Reinsurer as to
such change, except for changes required by any regulatory authority having
jurisdiction over the Coinsured Policies or as otherwise required by law. In the
event that the foregoing terms and conditions or assumptions, as the case may
be, are required to be changed by any regulatory authority having jurisdiction
over the Coinsured Policies, or as otherwise required by law, the Company shall
immediately notify the Reinsurer of such required changes.
7.9 Litigation. The Reinsurer shall be responsible for all
costs and expenses relating to litigation of claims under
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the Coinsured Policies. The Reinsurer shall have the right of prior approval,
which approval shall not be unreasonably withheld, regarding the conduct, costs
and expenses of such litigation for which the Reinsurer is responsible pursuant
to this Section 7.9. Notwithstanding the foregoing, the Reinsurer shall have no
liability for costs and expenses for any litigation arising out of, based on or
related to any bad faith claims practices, willful misconduct, fraud or gross
negligence of the Company or its Affiliates (without attributing to the Company
or its Affiliates the actions of the Reinsurer or its Affiliates).
ARTICLE VIII.
CONSIDERATION FOR REINSURANCE AND POLICY PREMIUMS
8.1 Assets to be Transferred at Effective Time. In
consideration for the assumption by the Reinsurer of the Company's Reserves and
Liabilities with respect to the Existing GBO Policies, as of the Effective Time,
the Company will transfer and assign to the Reinsurer, and the Reinsurer shall
acquire and accept from the Company, cash and/or Investment Assets with a fair
market value as of close of business on the date immediately preceding the
Closing Date in an amount [determined by management of the GBO Business in good
faith on or immediately prior to the Effective Time and based upon the most
recent financial data available].
8.2 Transition GBO Policies. No commission or reinsurance
premium shall be due or payable in connection with the issuance of the
Transition GBO Policies by the Company, and the reinsurance of the Transition
GBO Policies by Reinsurer, pursuant to Article VI of this Coinsurance Agreement.
8.3 Policy Premiums and Other Amounts. The Reinsurer shall, on
and after the Effective Time, collect and retain any and all gross premiums,
contract fees and any other amounts received on and after the Effective Time
with respect to the Coinsured Policies, less returns and net of premium for
Third Party Reinsurance to the extent such premium relates to the reinsurance of
Coinsured Policies.
ARTICLE IX.
BENEFITS AND OTHER PAYMENTS BY REINSURER
9.1 Benefits. Subject to the other provisions of this
Coinsurance Agreement, the Reinsurer shall assume liability for
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all benefit obligations with respect to Coinsured Policies, including interest
payable thereon (such benefits are herein referred to as "Benefits").
9.2 Claims. Upon receipt of any information regarding a claim
for Benefits on any Coinsured Policy, the Company will immediately notify the
Reinsurer of such claim. The reinsured claim and copies of notifications, claim
papers, and proofs will be promptly furnished by the Company to the Reinsurer as
provided in the Administration Agreement.
9.3 Claims Payments. The review, payment, settlement or
compromise of all claims and losses relating to the Coinsured Policies shall be
handled by the Reinsurer, in its capacity as service provider, in accordance
with the terms and conditions of the Administration Agreement. The Company will
not contest, compromise, or settle a claim with respect to a Coinsured Policy
without the prior written approval of the Reinsurer, unless otherwise required
by law or any regulatory authority; provided however, that in the event the
Company is so required to contest, compromise or settle a claim it shall give
prompt notice to the Reinsurer of such requirement, but in no event later than
ten (10) Business Days prior to the date of such contestation, compromise or
settlement.
9.4 Remittance of Third Party Reinsurance. The Company shall
promptly pay the Reinsurer all amounts owing from Third Party Reinsurance with
respect to the Coinsured Policies irrespective of the Company's ability to
collect such amounts from any other party to such Third Party Reinsurance. The
Reinsurer shall pay all premiums, Commissions or other amounts due for Third
Party Reinsurance to the extent attributable to reinsurance of Coinsured
Policies. The Company shall have the right to terminate any and all Third Party
Reinsurance with respect to the Coinsured Policies at any time or from time to
time on or after one year following the Effective Time; provided, however, that
the Company shall give the Reinsurer at least ninety (90) days' prior notice of
its intention to cancel any such Third Party Reinsurance.
9.5 Allowance for Commissions and Expenses. The Reinsurer
shall assume liability for all Commissions, taxes and guaranty fund assessments
imposed on or with respect to premiums earned under the Coinsured Policies after
the Effective Time; provided, however, the Reinsurer shall not pay the Company
any
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allowances or amounts for liabilities for guaranty fund assessments or taxes
that arise from or relate to the Existing GBO Policies and are incurred during
the period ending with the Effective Time.
9.6 Experience Rating Refunds. The Reinsurer shall assume
liability for policyholder experience rating refunds with respect to the
Coinsured Policies relating to periods prior to the Effective Time. A dividend
liability for policyholder experience rating refunds will be established on the
Closing GAAP Balance Sheet.
ARTICLE X.
DUTY OF COOPERATION
10.1 Duty of Cooperation. Each party hereto shall cooperate
fully with the other in all reasonable respects in order to accomplish the
objectives of, and consummate the transactions contemplated under, this
Coinsurance Agreement. This duty to cooperate shall include, but not be limited
to, making available any Coinsured Policy records which either party
subsequently may require to resolve issues related to claims or Reserves or
Liabilities.
ARTICLE XI.
ACCOUNTING AND SETTLEMENT
11.1 Remittances. In connection with all balances under this
Coinsurance Agreement with respect to premiums and Benefits and other amounts
received or to be paid subsequent to the Effective Time, in accordance with the
Administration Agreement, the Company and the Reinsurer shall establish an
account with a bank or trust company with respect to which the Reinsurer shall
have the authority to make deposits and withdrawals. The Company shall have no
authority to make deposits or withdrawals with respect to such account. This
account shall be financed by the Reinsurer for the benefit of the Company and
the Reinsurer. Settlements by the Company to the Reinsurer or by the Reinsurer
to the Company are deemed to take effect as the Reinsurer makes withdrawals from
or deposits into such account. Interest and any other income accruing on this
account shall be retained by the Reinsurer for its own account.
11.2 Quarterly Report. Within thirty (30) Business Days after
the end of each Accounting Period, the Reinsurer, as
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service provider under the Administration Agreement, shall supply the Company
with a report that shall provide data which shall account for all funds flowing
through the account established pursuant to Section 11.1 during such Accounting
Period and the net amount due by the Company or the Reinsurer, as appropriate
under this Coinsurance Agreement at the end of such Accounting Period. The data
shall be prepared substantially in the form attached hereto as Exhibit A;
provided, however, that the parties may agree from time to time on the precise
format and data which must be supplied on Exhibit A.
11.3 Amounts Due Either Party. Any net amount due from the
Company to the Reinsurer at the end of any Accounting Period shall be paid no
later than ten (10) Business Days after the date on which the Quarterly Report
showing such net amount, as described in Section 11.2 hereof, is due. Any net
amount due from the Reinsurer to the Company shall be paid no later than ten
(10) Business Days following the receipt of such quarterly report from the
Reinsurer. If amounts due to be paid cannot be determined at such dates on an
exact basis, such payments may be determined on an estimated basis, with
adjustments made at the end of subsequent Accounting Periods for actual amounts
ultimately determined to be due.
11.4 Interest on Delayed Payments. Should any payment due to
either the Company or the Reinsurer be delayed, such delayed payment (including
any amount constituting a difference between an estimated and actual amount, as
described in Section 11.3 hereof) will accrue interest at the interest rate for
thirty (30) day United States Treasury bills as reported in The Wall Street
Journal as of the day on which any payment is due for the period that payment is
overdue.
ARTICLE XII.
DURATION AND TERRITORY
12.1 Duration. This Coinsurance Agreement shall remain in full
force and effect for an unlimited time until all obligations hereunder have been
discharged or until the Company and the Reinsurer shall have agreed in writing
to a commutation or termination hereof.
12.2 Reinsurer's Liability. The Reinsurer's liability with
respect to any Coinsured Policy will terminate when the Company's liability
under the Coinsured Policy is terminated.
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12.3 Territory. This Coinsurance Agreement shall apply to
Coinsured Policies covering lives and risks wherever resident or situated.
ARTICLE XIII.
INSOLVENCY
13.1 Payments by Reinsurer. The Reinsurer hereby agrees that,
as to all reinsurance made, ceded or otherwise becoming effective hereunder, the
reinsurance shall be payable by the Reinsurer on the basis of the liability of
the Company under the Coinsured Policies, without diminution because of the
insolvency, liquidation or rehabilitation of the Company or the appointment of a
conservator, receiver, liquidator or statutory successor of the Company,
directly to the Company or to its conservator, receiver, liquidator, or other
statutory successor.
13.2 Claims. It is agreed that the conservator, receiver,
liquidator or statutory successor of the Company shall give prompt written
notice to the Reinsurer of the pendency or submission of a claim under any
Coinsured Policies. During the pendency of such claim, the Reinsurer may
investigate such claim and interpose, at its own expense, in the proceeding
where such claim is to be adjudicated any defense available to the Company or
its conservator, receiver, liquidator or statutory successor. The expense thus
incurred by the Reinsurer is chargeable against the Company as a part of the
expense of insolvency, liquidation or rehabilitation to the extent of a
proportionate share of the benefit which accrues to the Company solely as a
result of the defense undertaken by the Reinsurer. If two or more assuming
reinsurers are involved in the same claim and a majority in interest elect to
interpose defenses to such claim, the expense shall be apportioned in accordance
with the terms of this Section 13.2 as though such expense had been incurred by
the Company.
ARTICLE XIV.
ARBITRATION
14.1 General. Any dispute or difference between the parties
with respect to the operation or interpretation of, or arising from or relating
to, this Coinsurance Agreement on which an amicable understanding cannot be
reached shall be decided by binding arbitration. Arbitration hereunder shall be
pursuant to
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and in accordance with the terms, conditions and procedures set forth in Article
XV of the Purchase Agreement.
ARTICLE XV.
INDEMNIFICATION
15.1 The Reinsurer. The Reinsurer hereby agrees on demand to
indemnify and hold harmless the Company and its Affiliates, and their respective
officers, directors and employees from and against any and all demands, actions,
proceedings, suits (by any Person, entity or group, including, without
limitation, any Governmental Entity) and Liabilities, paid or incurred
(including reasonable attorneys' fees), resulting from or arising out of the
breach of or failure to perform any of the duties, obligations, covenants or
agreements of the Reinsurer contained in this Coinsurance Agreement.
15.2 The Company. The Company hereby agrees on demand to
indemnify and hold harmless the Reinsurer and its Affiliates, and their
respective officers, directors and employees from and against any and all
demands, actions, proceedings, suits (by any Person, entity or group, including,
without limitation, any Governmental Entity) and Liabilities, paid or incurred
(including reasonable attorneys' fees), resulting from or arising out of the
breach of or failure to perform any of the duties, obligations, covenants or
agreements of the Company contained in this Coinsurance Agreement.
15.3 Indemnification Procedures. Indemnification under
Section 15.1 and 15.2 shall be made using the procedures, terms and conditions
contained in Sections 14.2 and 14.3 of the Purchase Agreement as if fully set
forth herein, with (i) references in Section 14.2(a) to "indemnification under
Section 14.1 of this Agreement" changed to refer to "indemnification under
Section 15.1 or 15.2, as the case may be, of this Coinsurance Agreement", (ii)
the phrase "except as provided in Section 14.1(g) and" deleted in Section
14.2(c), (iii) references in Section 14.3 to "this Article XIV" shall be changed
to refer to "this Section 15.1" or "this Section 15.2", as the case may be, and
(iv) the phrases "and, in any event, within the time period referred to in
Section 14.1(g)" and "So long as Indemnitee provides the Indemnity Notice within
the time period referred to in Section 14.1(g)," deleted from the text of
Section 14.3; provided, however, that such indemnification shall
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be on a first dollar basis and be without regard to the aggregate of all
indemnifiable losses.
15.4 Survival of Article. This Article shall survive
termination of this Coinsurance Agreement.
ARTICLE XVI.
MISCELLANEOUS PROVISIONS
16.1 No Third Party Beneficiaries. This Coinsurance Agreement
is between the Company and the Reinsurer, and the performance of the obligations
of each party under this Coinsurance Agreement shall be rendered solely to the
other party. In no instance shall anyone other than the Company or the
Reinsurer, or their successors or permitted assigns, have any rights, benefits
or remedies under this Coinsurance Agreement. Until the Reinsurer has reinsured
a Coinsured Policy on an assumption reinsurance basis pursuant to the Assumption
Agreement, the Reinsurer shall not be liable to any insured, contract owner, or
beneficiary under any Coinsured Policy.
16.2 Headings and Exhibit. Headings used herein are inserted
solely for the convenience of reference and are not a part of this Coinsurance
Agreement and shall not affect the terms hereof. The attached Exhibit and
Schedule are a part of this Coinsurance Agreement.
16.3 Notices. All notices hereunder shall be in writing,
addressed as follows, or to such other address as may, from time to time, be
given in accordance with this Coinsurance Agreement:
If to the Company:
▇▇▇▇ ▇▇▇▇▇▇▇ MUTUAL LIFE INSURANCE COMPANY
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇,
Chief Financial Officer
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
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With copies to:
▇▇▇▇ ▇▇▇▇▇▇▇ MUTUAL LIFE INSURANCE COMPANY
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
▇▇▇▇▇▇ & ▇▇▇▇▇
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇, Esq.
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
If to the Reinsurer:
UNICARE LIFE & HEALTH INSURANCE COMPANY
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, Chairman
and Chief Executive Officer
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
With copies to:
UNICARE LIFE & HEALTH INSURANCE COMPANY
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.,
General Counsel
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP
▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇, Esq.
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Notices shall be sent by United States mail, by registered or certified mail,
and shall be deemed to have been received
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three (3) Business Days after deposit in the mail. Notices may also be sent by
hand, by telefax, or by overnight delivery service, and if so given, shall be
deemed received when delivered if a receipt of delivery is obtained.
16.4 Severability. If any term or provision of this
Coinsurance Agreement shall be held void, illegal, or unenforceable, the
validity of the remaining portions or provisions of this Coinsurance Agreement
shall not be affected thereby.
16.5 Assignment. This Coinsurance Agreement may not be
assigned by either party without the prior written consent of the other and any
attempted assignment without such consent shall be void.
16.6 Successors and Assigns. The provisions of this
Coinsurance Agreement shall be binding upon and inure to the benefit of and be
enforceable by the parties hereto and their respective successors and permitted
assigns.
16.7 Execution in Counterparts. This Coinsurance Agreement may
be executed by the parties hereto in any number of counterparts, and by each of
the parties hereto in separate counterparts, each of which counterparts, when so
executed and delivered, shall be deemed to be an original, but all such
counterparts shall together constitute but one and the same instrument.
16.8 Amendments. This Coinsurance Agreement may be amended
only by written amendment hereto executed by the parties.
16.9 Waiver. The failure of the Company or Reinsurer to insist
on strict compliance with this Coinsurance Agreement, or to exercise any right
or remedy under this Coinsurance Agreement, shall not constitute a waiver of any
rights provided under this Coinsurance Agreement, nor stop the parties from
thereafter demanding full and complete compliance nor prevent the parties from
exercising such a right or remedy in the future.
16.10 Interpretation. No provision of this Coinsurance
Agreement shall be construed against any party on the ground that such party
drafted the provision or caused it to be drafted.
16.11 Entire Agreement. This Coinsurance Agreement constitutes
the entire agreement and understanding between the parties hereto, and
supersedes all prior agreements, whether oral
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or written, between the parties, with respect to the subject matter hereof.
16.12 Governing Law. This Coinsurance Agreement shall be
governed by the laws of the Commonwealth of Massachusetts, without giving effect
to principles of conflicts of law thereof.
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IN WITNESS WHEREOF, the parties hereto have caused this
Coinsurance Agreement to be duly executed by their respective officers thereunto
duly authorized, on this __ day of January, 1997.
▇▇▇▇ ▇▇▇▇▇▇▇ MUTUAL LIFE
INSURANCE COMPANY
By:
Name:
-------------------------------
Title:
------------------------------
UNICARE LIFE & HEALTH
INSURANCE COMPANY
By:
Name:
-------------------------------
Title:
------------------------------
32
Exhibit A
COINSURANCE AGREEMENT
between
THE COMPANY
and
REINSURER
Effective Date __________________
BULK ACCOUNTING STATEMENT
STATEMENT FOR ACCOUNTING PERIOD BEGINNING _________________
SUMMARY OF MONETARY TRANSACTIONS
(1) CONSIDERATION FOR REINSURANCE
(2) COMMISSIONS
(3) EXPENSE ALLOWANCES
(4) BENEFITS (including interest)
(5) EXPERIENCE RATING REFUNDS
NET AMOUNT DUE TO THE COMPANY
NET AMOUNT DUE TO REINSURER