EX-99.B7. (ii)
AUTOMATIC REINSURANCE AGREEMENT
Between
MET LIFE INVESTORS USA INSURANCE COMPANY
and
EXETER REASSURANCE COMPANY, LTD.
AGREEMENT NO.____
THIS REINSURANCE AGREEMENT (the "Agreement") is made as of June 26, 2001 by and
between METLIFE INVESTORS USA INSURANCE COMPANY ("Cedent"), a life insurance
corporation organized and existing under the laws of Delaware and having it's
principal place of business at Newport Beach, CA, and EXETER REASSURANCE
COMPANY, LTD. ("Reinsurer"), a life insurance corporation organized and existing
under the laws of Bermuda and having its principal place of business at
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇ ▇▇, ▇▇▇▇▇▇▇.
THE BACKGROUND OF THIS AGREEMENT is that the Reinsurer has heretofore assumed,
as of the date hereof, quota share portions of certain ceded annuity contract
liabilities on Riders, listed in the attached Schedules, (the "Reinsured
Contract(s)") issued by MetLife Investors USA Insurance Company.
THIS AGREEMENT provides for the indemnity cession of a portion of the ceded
liabilities of the Cedents with respect to the Reinsured Contracts and binds the
Cedent and the Reinsurer and their successors and permitted assignees,
respectively. This Agreement shall not create any right or legal relation
whatever between the Reinsurer and any Cedent or any insured, owner, annuitant,
beneficiary or other party to any Reinsured Contract.
THEREFORE, in consideration of the promises set forth in this Agreement, the
parties agree as follows:
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ARTICLE I
SCOPE OF AGREEMENT
A. This Agreement shall be effective as of April 1, 2001 (the "Effective
Date"). The Cedent may cede and the Reinsurer may accept, as indemnity
cessions hereunder, proposed Reinsured Contracts that are issued by the
Cedent on and after the Effective Date through June 30, 2001. While
this Agreement continues in effect, the Cedent shall cede and the
Reinsurer shall accept, as indemnity cessions hereunder, Reinsured
Contracts that are issued by the Cedent on and after July 1, 2001.
B. Guaranteed Minimum Death Benefit and Earnings Preservation Benefit
1. The indemnity cession shall be the share of the MNAR (defined
in Article IV) that is generated, prior to the termination of
the Reinsurer's liability (defined in Article II), by the
Guaranteed Minimum Death Benefit ("GMDB") and Earnings
Preservation Benefit ("EPB") provisions of the Reinsured
Contracts, as specified in Schedule A.
2. The Reinsurer's maximum aggregate VNAR (defined in Article IV)
liability has no calculated aggregate limit.
3. The Reinsurer's annual aggregate SCNAR and EEMNAR (defined in
Article IV) liability has no independently calculated annual
aggregate liability limit.
4. The Reinsurer's maximum MNAR liability on any individual life
reinsured hereunder has no calculated aggregate limit.
5. This Agreement covers only the Cedent's contractual liability
for reinsured claims paid under variable annuity contract
forms specified in Schedule A and supported by investment
funds specified in Schedule B and its Amendments that were
submitted to the Reinsurer in accordance with the terms of
this Agreement as set forth in Article XV.
C. Guaranteed Minimum Income Benefit
1. The indemnity cession shall be the share of the IBNAR (defined
in Article IV) that is generated prior to the termination of
the Reinsurer's liability (defined in Article II), by the
Guaranteed Minimum Income Benefit Rider (the "Income Program")
provisions of the Reinsured Contracts, as specified in
Schedule A.
2. The Reinsurer's maximum aggregate IBNAR (defined in Article
IV) liability incurred in any one calendar year has no
calculated limit.
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3. The Reinsurer's maximum IBNAR liability on any individual life
reinsured hereunder has no calculated limit.
4. This Agreement covers only the Cedent's contractual liability
for reinsured claims that are realized upon annuitization
under the contractual terms of the Income Program within the
variable annuity contract forms specified in Schedule A and
supported by investment funds specified in Schedule B and its
Amendments, that were submitted to the Reinsurer in accordance
with the terms of this Agreement set forth in Article XV.
D. Special Acceptances
The Cedent may propose for special acceptance hereunder Reinsured
Contract liabilities that are not automatically ceded hereunder for
Spousal Continuances for GMDB as discussed under Article V, Paragraph
I, and contracts with certain issue dates as set forth in Schedule A,
Paragraph B. For a Special Acceptance, the Cedent shall report to the
Reinsurer, as promptly as possible, each Reinsured Contract that is
proposed for special acceptance, including proposed Reinsured Contracts
that are pending acceptance by the Cedent. The Cedent shall provide
information about each proposed Reinsured Contract in such scope and
format as may be agreed. Unless notified of rejection or special
cession rates within thirty (30) days, the proposed Reinsured Contract
shall be deemed accepted as an indemnity cession in accordance with the
terms and conditions specified herein.
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ARTICLE II
COMMENCEMENT AND TERMINATION OF LIABILITY
A. On liabilities ceded under the terms of this Agreement, the liability
of the Reinsurer shall commence simultaneously with that of the Cedent.
B. The liability of the Reinsurer for all ceded liabilities under this
Agreement may terminate in accordance with:
1. the Duration of Agreement provisions of this Agreement set
forth in Article XX;
2. the termination provisions set forth within Article VI; or
3. the Recapture Privileges set forth in Article IX.
C. Guaranteed Minimum Death Benefit and Earnings Preservation Benefit
1. For an individual contract, the liability of the Reinsurer
under this Agreement will terminate either in accordance with
Paragraph B, above, or upon the earliest of the following
occurrences defined in the contracts ceded hereunder:
a. the date the owner elects to annuitize;
b. surrender or termination of the contract;
c. the death of the owner or annuitant where such death
triggers the payment of a contractual benefit, except
when spousal continuance has been elected. On spousal
continuance election, the Reinsurer's liability will
be terminated upon death of the spouse; and
d. attainment of the maximum annuitization age or
attained age 95, if earlier.
2. The Reinsurer shall indemnify Reinsured Contract claims only
on those deaths as to which the actual date of death is on or
after the Effective Date.
D. Guaranteed Minimum Income Benefit
1. For an individual contract, the liability of the Reinsurer
under this Agreement will terminate either in accordance with
Paragraph B, above, or upon the earliest of the following
occurrences defined in the contracts ceded hereunder:
a. the date the owner elects to annuitize pursuant to
other than the Income Program;
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b. surrender or termination of the contract;
c. the death of the owner or annuitant where such death
triggers the payment of a contractual death benefit;
thus, risks emanating after spousal continuances are
not covered by this Agreement; and
d. attainment of the maximum annuitization age or
attained age 95, if earlier.
2. Upon annuitization under the Income Program, the liability of
the Reinsurer shall terminate, subject to the payment of a
benefit claim that may be due in accordance with the IBNAR
calculation as set forth in Article IV.
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ARTICLE III
ERRORS AND OMISSIONS
A. Any inadvertent errors or omissions on the part of one party occurring
in connection with this Agreement or any transaction hereunder shall
not relieve the other party from any liability to the first party that
would have otherwise attached had such error or omission not occurred,
provided that such error or omission is rectified as soon as
practicable after discovery thereof.
B. The Reinsurer assumes no liability under this Agreement for any
damages, fines, penalties, costs or expenses, or portion thereof,
levied on or assessed against the Cedent by any court or regulatory
body on the basis of negligence, oppression, malice, fraud, fault,
wrongdoing or bad faith by the Cedent in connection with any claim or
for any act or omission that is not consistent with the generally
accepted practices and standards of the life insurance industry
applicable at the time of such act or omission, unless the Reinsurer
shall have received notice of and concurred with the actions taken or
not taken by the Cedent that led to the levy or assessment, in which
case the Reinsurer shall pay, as its share of such levy or assessment,
the proportional amount determined by the ratio of reinsurance held by
the Reinsurer to the total limit of liability under the Reinsured
Contracts.
C. Each party will indemnify and hold the other party, its affiliates,
directors, officers, employees and all other persons and entities
acting on behalf of or under the control of any of them harmless from
and against any and all claims, including reasonable attorneys fees and
court costs, that result from any negligent, dishonest, malicious,
fraudulent or criminal act or omission or arising out of or related to
any incorrect representation, warranty or obligation of this Agreement
or any failure or breach of this Agreement by the indemnifying party,
its directors, officers, employees, other representatives or any other
person or entity acting on behalf of or under the control of any of
them.
D. In no event shall any party to this Agreement be liable to any other
party for punitive, indirect or consequential damages arising under
this Agreement for any cause whatsoever, whether or not such party has
been advised or could have foreseen the possibility of such damages.
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ARTICLE IV
NET AMOUNT AT RISK
GMDB AND EPB
------------
A. The MNAR (Mortality Net Amount at Risk) for each variable annuity
contract ceded hereunder shall be equal to the following:
MNAR = VNAR + SCNAR + EEMNAR
in which:
VNAR (Variable Net Amount at Risk) = Maximum (a,b) multiplied by the
Reinsurer's Percentage (defined in Schedule A) in which:
a = (Contractual Death Benefit - Account Value) and
b = 0
SCNAR (Surrender Charge Net Amount at Risk) = Surrender Charges
multiplied by the Reinsurer's Percentage
EEMNAR (Earnings Enhancement Mortality Net Amount at Risk) = x% *
Maximum (a,b) multiplied by the Reinsurer's Percentage where:
x% varies by issue age as described under the Death Benefits
Ceded section of Schedule A
a = (Contractual Death Benefit - Total Purchase Payments Not
Withdrawn)
b = 0
Spousal Continuances
--------------------
The Reinsurer will indemnify the Cedent for the Reinsurer's Percentage
of the SCNAR realized upon death, consistent with the Cedent's
indemnification, if any, of a Cedent as a result of the Cedent's waiver
of surrender charges when the death benefit is paid out.
The Reinsurer shall indemnify the Cedent for the Reinsurer's Percentage
of surrender charges indemnified by the Cedent, if any, arising from
additional premium deposits contributed by the spouse to the contract
on or after the spousal continuance date; provided, however, that the
attained age of the surviving spouse, as of the date of continuance,
was less than age 81.
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In no event will the Reinsurer indemnify surrender charges arising from
the same premium deposits more than once.
B. The death benefit and the surrender charges will be as described in the
variable annuity contract forms specified in Schedule A.
GMIB
----
C. The IBNAR (Income Benefit Net Amount at Risk) for each variable annuity
contract ceded hereunder shall be equal to the following:
IBNAR = Maximum [(IBB * (MAPR/SAPR) - Account Value), 0] * Reinsurer's
Percentage
where:
o The INCOME BENEFIT BASE (IBB) is as defined in Schedule A
o The MINIMUM ANNUITY PURCHASE RATE (MAPR) per $1000 is
calculated using the following assumptions:
Mortality Table Annuity 2000 (Exhibit I)
Age Setback 7 Years
Mortality Improvement None
Unisex Blend: Sex distinct only
Interest Rate: 2.5% all years
Expenses: None
Premium Taxes: Applied by state of residence
and market
Age: Attained age on exercise date
Frequency of payment Monthly
Annuity form:
1. Individual Basis: Limited to a Life Annuity with a Period
Certain. The number of years of Period Certain is as defined
below:
Age at Annuitization Period Certain Years
-------------------- --------------------
Up to 79 10
80 9
81 8
82 7
83 6
84-85 5
2. Joint Basis: Limited to a Joint and 100% Survivor Annuity with
10- Year Period Certain
o The SETTLEMENT ANNUITY PURCHASE RATE (SAPR) per $1000, which
is used at time of annuitization for reinsurance claims
settlement shall be equal to the fixed annuity purchase rate
that the Cedent would provide to an annuitant in the same
class.
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Annuity form:
1. Individual Basis: Limited to a Life Annuity with a Period
Certain The number of years of Period Certain is as defined
below:
Age at Annuitization Period Certain Years
-------------------- --------------------
Up to 79 10
80 9
81 8
82 7
83 6
84-85 5
2. Joint Basis: Limited to a Joint and 100% Survivor Annuity with
10- Year Period Certain
D. Premium taxes will be applied on a consistent basis between the MAPR
and SAPR to calculate the IBNAR.
E. The IBNAR for each contract ceded hereunder shall be calculated as of
the last day of each calendar month prior to the termination of
liability contingencies set forth in Article II.
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ARTICLE V
REINSURANCE PREMIUMS
A. The total Reinsurance Premium for the business ceded hereunder is the
sum of the GMDB Reinsurance Premium, the EPB Reinsurance Premium and
the GMIB Reinsurance Premium, each of which is defined separately in
this article.
B. The Reinsurance Premium rates and structure described above are subject
to change in accordance with the criteria described in Article XV.
GMDB and EPB
------------
C. The total GMDB Reinsurance Premium for the business ceded hereunder is
the sum of the GMDB Reinsurance Premium and the EPB Reinsurance
Premium, each of which is defined separately in this article.
GMDB Cession Premium
--------------------
D. The GMDB Reinsurance Premium is expressed in terms of basis points and
is defined in Exhibit II.
E. The Cedent shall calculate, for each premium class, the Reinsurer's
Percentage of the greater of the average aggregate GMDB value and the
average aggregate account value for the reporting month. This value
shall be applied to the GMDB Cession Premium rates per premium class on
a 1/12th basis.
EPB Cession Premium
-------------------
F. The EPB Reinsurance Premium is an asset-based premium rate, expressed
in terms of basis points, and is defined in Exhibit II.
G. The Cedent shall calculate, for each premium class, the Reinsurer's
Percentage of the average aggregate account value for the reporting
month. This value shall be applied to the annualized EPB reinsurance
premium rates per premium class on a 1/12th basis. The total EPB
Cession Premium due for the month is the sum of the premiums calculated
for each premium class.
Spousal Continuances
--------------------
H. Spousal continuances will be covered under this Agreement to the extent
that the surviving spouse satisfies the issue age restrictions and
benefit limitations, as described in Schedule A, at time of
continuance, and shall be deemed to be terminations followed by
subsequent new issues for purposes of calculating Reinsurance Premiums.
The new reinsurance premium rate applied shall be based off the
attained age of the surviving spouse at the time of election of spousal
continuance. After the termination of this Agreement for new cessions,
a spousal continuation of a Reinsured Contract may be ceded to this
Agreement in accordance with the procedure set forth in Article I,
Paragraph D.
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GMIB
----
I. The GMIB cession premium ("GMIB Reinsurance Premium") is an asset-based
premium rate, expressed in terms of basis points, as set forth in
Exhibit II, and shall be calculated on an aggregate basis.
J. The Cedent shall calculate the Reinsurer's Percentage of the greater of
the average aggregate IBB value and the average aggregate account value
for the reporting month. This value shall be applied to the annualized
GMIB cession premium rates on a 1/12th basis.
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ARTICLE VI
REINSURANCE ADMINISTRATION
A. Within thirty (30) days after the end of each calendar month, the
Cedent shall take all reasonable and appropriate steps to furnish the
Reinsurer with a seriatim electronic report, as detailed in Schedule C,
for each Reinsured Contract, valued as of the last day of that month.
On or before September 30, 2001, the Cedent shall provide the initial
seriatim electronic report, which shall cover the period from the
Effective Date hereof through August 31, 2001; provided, however, that
the initial seriatim electronic report may omit Funding Vehicle Values
by MorningStar designation. The Cedent shall provide complete seriatim
electronic data, as required herein, on or before April 30, 2002.
Failure to provide this information as required shall constitute a
material breach within the scope of Article XX, Paragraph G.
B. Additionally, within thirty (30) days after the end of each calendar
month the Cedent shall furnish the Reinsurer with a separate Summary
Statement containing the following:
1. Reinsurance Premiums due to the Reinsurer summarized
separately for each premium class by GMDB, EPB, and Income
Program, as shown in Exhibit II;
2. benefit claim recoverables due to the Cedent in total and, if
applicable, broken down by VNAR, SCNAR, and EEMNAR and Income
Program; and
3. the month end date for the period covered by the Summary
Statement.
C. If the net balance is due to the Reinsurer, the Cedent shall remit the
amount due with the Summary Statement, but no later than thirty (30)
days after the month end date for the period covered by the Summary
Statement. If the net balance is due to the Cedent, the Reinsurer shall
remit the amount due to the Cedent within ten (10) days after receipt
of the Summary Statement.
D. The payment of Reinsurance Premiums is a condition precedent to the
liability of the Reinsurer under this Agreement. In the event that the
Cedent does not pay the Reinsurance Premiums in a timely manner, as
defined below, the Reinsurer may exercise the following rights:
1. The Reinsurer shall charge interest if Reinsurance Premiums
are not paid within thirty (30) days of the due date, as
defined in Paragraph C of this Article. The interest rate
charged shall be based on the ninety-(90) day federal Treasury
▇▇▇▇, as published in The Wall Street Journal on the first
business day in the month following the due date of the
Reinsurance Premiums, plus one hundred (100) basis points. The
method of calculation shall be simple interest (360-day year).
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2. The Reinsurer may terminate this Agreement in the event that
Reinsurance Premium payments are more than sixty (60) days
past due after the due date, as described in Paragraph C of
this Article, by giving sixty (60) day written notice of
termination to the Cedent. As of the close of the last day of
this sixty-(60) day notice period, the Reinsurer's liability
with respect to the ceded liabilities shall terminate. If all
Reinsurance Premiums that are the subject of a sixty (60) day
termination notice shall have been received by the Reinsurer
within the time specified, the termination notice shall be
deemed vacated and the Agreement shall remain in effect.
E. GMDB and EPB: The Reinsurer shall use the summary data in Schedule C to
calculate and monitor its maximum VNAR liability throughout the
calendar year. Until the receipt of the final report for the calendar
year, the VNAR shall be estimated in accordance with reasonable
actuarial methods that will approximate the actual amounts. Adjustments
to benefit claim recoverables based upon such estimates will then be
made to reflect actual amounts upon the receipt of the final report for
the calendar year.
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ARTICLE VII
SETTLEMENT OF CLAIMS
A. GMDB and EPB: The Reinsurer shall indemnify the Cedent under this
Agreement only for benefit claims that the Cedent paid to the Cedent as
contractually required under a Reinsured Contract with respect to
deaths that occur on or after the Effective Date, subject to the
liability limitations described in Article I.
GMIB: The Reinsurer shall indemnify the Cedent under this Agreement
only for benefit claims that the Cedent paid to the Cedent as
contractually required under a Reinsured Contract on or after the
expiration of the waiting period and upon annuitization under the terms
of the Income Program where such events occur, on the policies
reinsured hereunder, on or after the Effective Date, subject to the
liability limitations described in Article I.
B. In the event that the Cedent provides satisfactory proof of claim
liability to the Reinsurer, benefit claim settlements made by a Cedent
and accepted by the Cedent shall be unconditionally binding on the
Reinsurer. The Cendent shall report all approved benefit claims in
bordereau including cause of death, as available, in such format as may
be agreed to from time to time.
C. GMDB and EPB: Within thirty (30) days after the end of each calendar
month, the Cedent shall notify the Reinsurer of the ceded contractual
death benefit claims paid in respect of Reinsured Contracts in that
month, based on the net amount at risk definition, set forth in Article
IV, and the Reinsurer shall indemnify the Cedent as provided in Article
VI for the ceded benefit claim liabilities.
GMIB: Within thirty (30) days of the end of each calendar month, the
Cedent shall notify the Reinsurer of the ceded contractual Income
Program benefits paid in respect of Reinsured Contracts in that month,
based on the IBNAR definition set forth in Article IV, and the
Reinsurer shall indemnify the Cedent as provided in Article VI for the
ceded benefits.
D. In no event will the Reinsurer be liable for expense incurred in
connection with a dispute or contest arising out of conflicting or any
other claims of entitlement to Reinsured Contract proceeds or benefits.
E. Settlements hereunder by the Reinsurer shall be made in a lump sum
regardless of the mode of payment made by the Cedent.
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ARTICLE VIII
RESERVES
A. The Reinsurer shall hold and report in its statutory financial
statements reserves (the "Reserves") with respect to liabilities ceded
under this Agreement in amounts equal to or greater than those required
by the state in which its statement is filed.
B. If required by the Cedent, as a condition of securing ceded reinsurance
statement credit for a Cedent with respect to Reinsured Contracts, the
Reinsurer shall contractually require any subsequent reinsurers to hold
and report in their statutory financial statements reserves in amounts
equal to or greater than those that would have been required of the
Reinsurer.
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ARTICLE IX
RECAPTURE PRIVILEGES
A. The Cedent may recapture existing cessions in force in accordance with
the following rules:
1. The Cedent shall notify the Reinsurer of its intention to
recapture at least ninety (90) days prior to any recapture.
2. The Cedent may not recapture a cession unless this Agreement
shall have been in force for fifteen (15) years, as measured
from the Effective Date until the date of recapture.
3. The recapture shall apply to all cessions in force under this
Agreement.
4. The recapture shall be mutually agreed upon by the Cedent and
the Reinsurer.
5. Recapture shall take place ratably over a thirty-six (36)
month period (i.e., each month, the initial percentage reduces
2.78% times the initial percentage). The election to recapture
shall be irrevocable.
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ARTICLE X
INSPECTION OF RECORDS
A. The Reinsurer and the Cedent and their employees and authorized
representatives, respectively, may audit, inspect and examine, during
regular business hours, at the home office of the other party, provided
that reasonable advance notice has been given, any and all books,
records, statements, correspondence, reports, and their related
documents or other documents that relate to Reinsured Contracts.
B. The audited, inspected or examined party shall provide a reasonable
work space for such audit, inspection or examination, cooperate fully
and disclose the existence of and produce any and all necessary and
reasonable materials requested by such auditors, investigators or
examiners. Each party will bear its own audit expenses.
C. All such information, including audit, inspection and examination
reports and analyses, shall be kept confidential as provided herein.
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ARTICLE XI
INSOLVENCY
A. In the event of the insolvency of the Cedent, any amounts payable
hereunder shall be paid by the Reinsurer directly to the Cedent or to
its domiciliary liquidator on the basis of the liability of the Cedent
under the Reinsured Contracts without diminution because of such
insolvency or because such liquidator has failed to pay any or a
portion of any ceded benefit claims under Reinsured Contracts.
B. In any such event, the domiciliary liquidator of the Cedent shall give
written notice of the pendency of a claim against the Cedent on a
Reinsured Contract within a reasonable time after each such claim is
filed in the insolvency proceeding.
C. During the pendency of any such claim the Reinsurer may, at its own
expense, investigate such claim and interpose in the proceeding in
which such claim is to be adjudicated any defense or defenses that the
Reinsurer may reasonably deem available to the Cedent or its
domiciliary liquidator. The expenses incurred in connection therewith
by the Reinsurer shall be chargeable, subject to court approval,
against the Cedent as part of the expense of such insolvency to the
extent of a proportionate share of any benefit that accrues to the
Cedent solely as a result of the defense or defenses undertaken by the
Reinsurer. When two or more reinsurers are participating in the same
claim and a majority in interest elect to interpose a defense or
defenses to any such claim, the expenses will be apportioned in
accordance with the terms of the Reinsurance Agreement as though such
expense had been incurred by the Cedent.
D. In the event of the insolvency of the Reinsurer, the liability of the
Reinsurer hereunder shall continue with respect to cessions that
occurred prior to the date of the insolvency and the Cedent shall have
a security interest in any and all sums held by or under deposit in the
name of the Reinsurer for the benefit of the Cedent. The provisions of
Article XX notwithstanding, the Cedent may, at its option, immediately
terminate this Agreement as to future cessions as of the date of the
insolvency by written notice to the Reinsurer or to its domiciliary
liquidator, as applicable, and any required waiting period shall be
waived.
E. A party to this Agreement shall be deemed insolvent when it:
1. applies for or consents to the appointment of a receiver,
rehabilitator, conservator, liquidator or statutory successor
of its properties or assets;
2. is adjudicated as bankrupt or insolvent;
3. files or consents to the filing of a petition in bankruptcy,
seeks reorganization or an arrangement with creditors or takes
advantage of any bankruptcy, dissolution, liquidation or
similar law; or
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4. becomes the subject of an order to rehabilitate or an order to
liquidate in accordance with the insurance law of the party's
domiciliary jurisdiction.
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ARTICLE XII
NEGOTIATION
A. Within ten (10) days after one of the parties shall have given to the
other a first written notice of a specific dispute, each party shall
designate an officer to seek a negotiated settlement. The designated
officers shall promptly meet at an agreed location and negotiate in
good faith.
B. If the officers cannot resolve the dispute within thirty (30) days
after their first meeting, either party may commence arbitration
proceedings. The parties may, however, agree, at any time to forego or
terminate negotiations and proceed immediately to arbitration or to
extend negotiations for an additional time certain.
C. All rights shall be reserved to each party pending a settlement of a
dispute and no admissions, offers or other actions taken in such
negotiations in efforts to effect a voluntary settlement of the
disputed matter shall be admissible in any subsequent arbitration
proceedings.
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ARTICLE XIII
ARBITRATION
A. All disputes and differences between the parties will be decided by
arbitration, regardless of the insolvency of either party, unless the
liquidator, receiver or statutory successor is specifically exempted
from an arbitration proceeding by applicable law.
B. Either party may initiate arbitration by providing written notification
to the other party that sets forth (a) a brief statement of the
issue(s); (b) the failure of the parties to reach agreement; and (c)
the date of the demand for arbitration.
C. The arbitration panel shall consist of three arbitrators who must be
impartial and each of whom must, at that time, either be accredited as
an arbitrator by ▇▇▇▇▇-US or be an active or former officer of a life
insurance or reinsurance companies other than the parties or their
affiliates.
D. Each party shall select an arbitrator within thirty (30) days from the
date of the demand. If either party shall refuse or fail to appoint an
arbitrator within the time allowed, the party that has appointed an
arbitrator may notify the other party that, if it has not appointed its
arbitrator within the following ten (10) days, the arbitrator will
appoint an arbitrator on its behalf. The two (2) arbitrators shall
select the third arbitrator, who must also be, at that time, accredited
by ▇▇▇▇▇-US as an Umpire, within thirty (30) days of the appointment of
the second arbitrator. If the two arbitrators fail to agree on the
selection of the third arbitrator within the time allowed, the Umpire
Selection Procedures of ▇▇▇▇▇-US, as in force at that time, shall be
used to select the third arbitrator.
E. The arbitrators shall interpret this Agreement as an honorable
engagement rather than merely as a legal obligation and shall consider
equitable principles as well as industry custom and practice regarding
the applicable insurance and reinsurance business. The arbitrators are
released from judicial formalities and shall not be bound by strict
rules of procedure and evidence.
F. The arbitrators shall determine all arbitration schedules and
procedural rules and may, in their discretion, use applicable ▇▇▇▇▇-US
forms and procedures. Organizational and other meetings will be held in
New York, NY, unless the arbitrators shall otherwise provide. The
arbitrators shall decide all matters by majority vote.
G. The decisions of the arbitrators shall be final and binding on both
parties. The arbitrators may, in their discretion, award costs and
expenses as they deem appropriate, including but not limited to legal
fees and interest. Judgment may be entered upon the final decisions of
the arbitrators in any court of competent jurisdiction. The arbitrators
may not award any exemplary or punitive damages.
Page 21
H. Unless the arbitrators shall provide otherwise, each party will be
responsible for (a) all fees and expenses charged by its respective
counsel, accountants, actuaries and other representatives in connection
with the arbitration and (b) one-half of the expenses of the
arbitration, including the fees of the arbitrators.
Page 22
ARTICLE XIV
RIGHT TO OFFSET BALANCES DUE
All moneys due either the Cedent or the Reinsurer under this Agreement shall be
offset against each other, dollar for dollar, regardless of any insolvency of
the other party.
Page 23
ARTICLE XV
CONTRACT AND PROGRAM CHANGES
A. The Cedent may amend, substitute, add or delete variable investment
funds to the investment options supporting the annuity contracts as
described in the contract general provisions. The Cedent shall make no
such change without prior notification to the Reinsurer, which
notification shall be promptly forwarded to the Reinsurer, and without
the prior approval of the Securities and Exchange Commission (SEC) or
applicable self-regulatory body approval, if necessary. The Cedent
shall provide thirty (30) days prior written notice to the Reinsurer,
unless otherwise agreed to by the Cedent and the Reinsurer, of any
proposed change in the investment options supporting Reinsured
Contracts. The Cedent shall maintain a reasonable selection of core
investment options with characteristics similar to those listed in
Schedule B.
B. The Cedent shall give the Reinsurer thirty (30) days prior written
notice, unless otherwise agreed to by the Cedent and the Reinsurer, of
any other accepted changes to the Reinsured Contracts relating to a
Cedent's annuity product design and/or death benefit design, fees and
charges, distribution systems and/or methods or addition of any riders
to any Reinsured Contract forms.
C. The Cedent shall provide to the Reinsurer a copy of each general
communication that the Cedent sends to contract holders in any state.
D. The Cedent shall simultaneously provide to the Reinsurer and any
subsequent retrocessionaires, a copy of any notice of any proposed
change in the investment options supporting Reinsured Contracts, and/or
any other accepted changes to the Reinsured Contracts related to a
Cedent's annuity product design and/or death benefit design, fees,
charges, distributions systems and/or methods or additions of any
riders to any Reinsured Contract forms.
Page 24
ARTICLE XVI
CONFIDENTIALITY
A. Each party shall maintain the confidentiality of all information,
including legally protected personal information pertaining to
individuals, that is provided to it by the other party in connection
with this Agreement; provided, however, that this obligation of
confidentiality shall not apply (a) if and to the extent that
disclosure is required by applicable law or any court, governmental
agency or regulatory authority or by subpoena or discovery request in
pending litigation; (b) if the information is or becomes available from
public information (other than as a result of prior unauthorized
disclosure by the disclosing party); (c) if the information is or was
received from a third party not known by the disclosing party to be
under a confidentiality obligation with regard to such information; or
(d) if the information was in the possession of the disclosing party
(having received such information on a non-confidential basis) other
than by reason of the services performed pursuant to this Agreement;
provided, further, that legally protected information shall not be
disclosed or used in violation of applicable law.
B. In the event that either party becomes legally compelled to disclose
any such confidential information, such party will give prompt written
notice of that fact to the other party so that such other party may
seek an appropriate remedy to prevent such disclosure; provided,
however, that this provision shall not apply to information that is or
otherwise becomes available to the public or that was previously
available to the public on a non-confidential basis.
C. Information may be disclosed (duplicating is permitted for such
disclosure) to a party's directors, officers, employees, agents,
affiliates (excluding Reinsurance Group of America, Incorporated, as an
affiliate of the Cedent) and external advisors and their directors,
officers, employees, professional advisers, agents and rating agencies
(collectively, the "Representatives") and all such Representatives
shall be advised of the terms of this Agreement and each party shall be
responsible for any breach of the terms of this Agreement by its
Representatives.
Page 25
ARTICLE XVII
OTHER PROVISIONS
A. Notice. Written notices under this Agreement shall be effective when
delivered to any party at the address provided herein:
1. If to the Cedent:
▇▇▇▇ ▇▇▇▇▇▇▇▇▇-▇▇▇▇▇▇▇
MetLife Investors USA Insurance Company
C/O Metropolitan Life Insurance Company
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇▇ ▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Phone: (▇▇▇)▇▇▇-▇▇▇▇ Fax: (▇▇▇)▇▇▇-▇▇▇▇
2. If to the Reinsurer:
▇▇▇▇ ▇▇▇▇▇▇▇▇, C.A., Agent
Exeter Reassurance Company, Ltd.
C/O ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇ Management, Ltd.
Continental ▇▇▇▇▇▇▇▇
▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
P.O. Box HM 2461
▇▇▇▇▇▇▇▇ ▇▇ JX, Bermuda
Either party may change its address by giving the other party written
notice of its new address; provided, however, that any notice of a
change of address shall be effective only upon receipt.
B. Administrative Communications and Payment Remittances. Each party
shall, by written notice to the other, designate offices and
depositaries for the receipt of administrative communications and
payment remittances. Administrative communications and payments
remittances shall be deemed delivered only upon actual receipt by the
designated office or depositary, respectively.
C. Amendment and Non Waiver. Any change or modification of this Agreement
shall be null and void unless made by amendment to the Agreement and
signed by both parties. No waiver by either party of any default by the
other party in the performance of any promise, term or condition of
this Agreement shall be construed to be a waiver by such party of any
other or subsequent default in performance of the same or any other
promise, term or condition of this Agreement. No prior transactions or
dealings between the parties shall be deemed to establish any custom or
usage waiving or modifying any provision hereof. The failure of either
party to enforce any part of this Agreement shall not constitute a
waiver by such party of its right to do so, nor shall it be deemed to
be an act of ratification or consent.
D. Assignment. This Agreement shall be binding on the parties and their
respective successors and permitted assignees. This Agreement may not
be assigned by either party without the written consent of the other,
which consent shall not be unreasonably withheld.
Page 26
E. Reinsured Contract Assignments. The Cedent may, in its discretion and
without the separate consent of the Reinsurer, accept a substitution of
a majority-owned affiliate of Metropolitan Life Insurance Company in
lieu of any Cedent as to any Reinsured Contract, whether by assumption
reinsurance or otherwise, with the Reinsured Contract continuing in
force unchanged, which substitution shall be binding on the Reinsurer.
F. Severability. In the event that any provision or term of this Agreement
shall be held invalid, illegal or unenforceable, all of the other
provisions and terms shall remain in full force and effect to the
extent that their continuance is practicable and consistent with the
original intent of the parties. In addition, if provisions or terms are
held invalid, illegal or unenforceable, the parties will attempt in
good faith to renegotiate the Agreement to carry out its original
intent.
G. Survival. All provisions of this Agreement shall, to the extent
necessary to carry out the purposes of this Agreement or to ascertain
and enforce the parties' rights hereunder, survive its termination.
H. Choice of Law, Forum and Consent to Service. This Agreement is subject
to and is to be interpreted in accordance with the laws of the State of
New York without regard to the New York choice of law rules. While the
parties contemplate that all disputes will be decide through
negotiation or arbitration as provided herein, in the event of any
legal proceedings, the parties shall submit to the exclusive
jurisdiction of courts of the State of New York and the United States
of America located in the City of New York and shall abide by the final
decision of such courts. Each party hereby designates the
Superintendent of Insurance of the State of New York as its true and
lawful attorney upon whom may be served any lawful process in any
action, suit or proceeding instituted by or on behalf of the other
party arising out of the Agreement. Process accepted by the
Superintendent on behalf of party shall be forwarded to that party at
the address specified herein.
I. Settlements. Claim settlements made by the Cedent in good faith,
including compromises, shall be unconditionally binding on the
Reinsurer.
J. Payments. All reinsurance settlements and other payments will be
effected through off-setting balances, electronic funds transfers or as
the parties may otherwise agree to carry out the purposes of this
Agreement.
K. Currency. All financial transactions under this Agreement shall be made
in U. S. dollars.
L. Intermediaries. Each party represents that all negotiations relative to
this Agreement and the transactions contemplated hereby, including any
subsequent Assumption Reinsurance Agreement with respect to the
Reinsured Contracts, have been carried out by the Cedent and the
Reinsurer directly and without the intervention of any person in such
manner as to give rise to any valid claim by any other person for a
finder's fee, brokerage commission or similar payment.
Page 27
M. Construction Rules. Each party represents that its has been represented
by and relied on the advice of counsel of its choice in the negotiation
and drafting of the Agreement. The parties affirm that their respective
counsel have had a substantial role in the drafting and negotiation of
this Agreement and, therefore, the rule of construction that any
ambiguities are to be resolved against the drafting party shall not be
employed in the interpretation of this Agreement or any Schedule
attached hereto.
N. Authority. Each party represents that it has full power and authority
to enter into and to perform this Agreement and that the person signing
this Agreement on its behalf has been properly authorized and empowered
to do so. Each party further acknowledges that it has read this
Agreement, understands it and agrees to be bound by it.
O. Changes. In the event the Cedent's liability to make any payment is
changed due to a modification or cancellation of a Reinsured Contract,
Reinsurer's liability to make any such payment shall also be changed in
the same manner and to the same extent. In the event that the amount of
liability provided by a Reinsured Contract is increased or reduced
because of a misstatement of age or sex, the reinsurance liability of
the Reinsurer shall be increased or reduced by the same amount. Any
adjustments for this reason shall be made without interest.
P. Unreasonable Refusal of Agreement. Neither party, acting unreasonably,
will withhold agreement to any discretionary action for the sole
purpose of terminating this Agreement or otherwise frustrating its
purpose.
Q. Independent Contractor. The parties shall be deemed to be independent
contractors, each with full control over its respective business
affairs and operations. This Agreement shall not be construed as a
partnership or joint venture and neither party hereto shall be liable
for any obligations incurred by the other party except as expressly
provided herein.
R. Schedules, Exhibits and Captions. Schedules and Exhibits attached
hereto are incorporated into this Agreement. Captions are provided for
reference only.
S. Counterparts. This Agreement may be signed in any number of
counterparts, each of which shall be deemed an original and all of
which shall constitute one and the same instrument.
T. The Cedent shall notify the Reinsurer in advance of entry into any
amendment to the Reinsurance Agreement and, in the event that such
amendment would materially change the ceded liabilities, the parties
shall modify the provisions of this Agreement to restore the Reinsurer
to its original position unless the parties shall agree otherwise.
Page 28
ARTICLE XVIII
ENTIRE AGREEMENT
This Agreement, together with Schedules A, B and C, and Exhibits I and II
supercedes all prior discussions and agreements between the parties and
constitutes their sole and entire agreement with respect to Reinsured Contracts
and there are no understandings between the parties other than as expressed
herein.
Page 29
ARTICLE XIX
DAC TAX
A. The parties will make a joint election, in accordance with Treas. Reg.
1.848-2(g)(8), issued December 28, 1992, under ss. 848 of the Internal
Revenue Code and the party with the net positive consideration under
this Agreement will capitalize specified policy acquisition expenses
with respect to this Agreement without regard to the general deductions
limitations of ss. 848(c)(1) of the Code;
1. the election will take effect on the Effective Date and will
remain in effect for all subsequent years that this Agreement
remains in effect; and
2. each party shall attach a schedule to its federal income tax
return for its first taxable year ending after the election
becomes effective that identifies the agreements (including
this Agreement) for which joint elections have been made under
this Regulation.
B. Pursuant to this joint election:
1. each party will exchange information pertaining to the amount
of net consideration under this Agreement to assure
consistency or as may otherwise be required by the Internal
Revenue Service;
2. Cedent will submit its calculation of the "net consideration"
as defined under the above referenced regulation to Reinsurer
not later than May 1 for each and every tax year for which
this Agreement is in effect;
3. Reinsurer may challenge such calculation within ten (10)
working days of receipt of the Cedent's calculation; and
4. the parties will act in good faith to reach agreement as to
the correct amount of net consideration whenever there is
disagreement as to the amount of net consideration as
determined under Treas. Reg. 1.848-2(f).
C. Each party represents and warrants that it is subject to U. S. taxation
under Subchapter L of Chapter 1 of the Code.
Page 30
ARTICLE XX
DURATION OF AGREEMENT
GMDB AND EPB
------------
A. Cessions may be made to this Agreement through June 30, 2004, subject
to a limit of three billion dollars ($3,000,000,000) of total new
considerations to the Reinsurer on the product(s) ceded hereunder;
provided, however, that the parties may, by agreement, amend this
Agreement at anytime to provide for cessions of ceded liabilities under
Reinsured Contracts beyond or in excess of the limitations set forth
herein.
B. Anytime on or after June 30, 2004, or anytime on or after the
attainment of the limit for total new considerations described in
Paragraph A, and upon ninety (90) days prior written notice, either the
Cedent of the Reinsurer may cancel this Agreement for future cessions.
GMIB
----
C. Cessions may be made to this Agreement through June 30, 2004, subject
to a limit of one billion dollars ($1,000,000,000) of total new
considerations to the Reinsurer on the product(s) ceded hereunder;
provided, however, that the parties may, by agreement, amend this
Agreement at anytime to provide for cessions of ceded liabilities under
Reinsured Contracts beyond or in excess of the limitations set forth
herein.
D. Anytime on or after June 30, 2004, or anytime on or after attainment of
the limit for total new considerations described in Paragraph C, and
upon ninety (90) days written notice, either the Cedent or the
Reinsurer may cancel this Agreement for future cessions as provided
above.
GENERAL
-------
E. Except as otherwise provided herein, the Agreement shall be unlimited
in duration but may be reduced or terminated for future cessions.
F. This Agreement shall remain in force as provided herein until the
termination of the Cedent's liability on the Reinsured Contracts.
G. Either party may terminate this Agreement in the event that the other
party is in material breach of the terms or conditions of this
Agreement provided that the terminating party has notified the other
party of the breach and the other party has not initiated the cure of
such breach within thirty (30) days after such notice to be effectuated
as promptly as possible.
Page 31
H. In the event that a Cedent shall terminate a Reinsurance Agreement for
the cession of new annuity contract liabilities because, in its
discretion, after a good faith effort, it was unable to obtain
regulatory credit for reinsurance ceded to the Reinsurance Agreement,
this Agreement shall continue in effect, on a run-off basis, for all
annuity contract liabilities ceded by that Cedent prior to the
Reinsurance Agreement termination date; provided, however, that the
Cedent has made a good faith effort to obtain regulatory credit for
reinsurance ceded to the Reinsurance Agreement.
Page 32
ARTICLE XXI
NON-ADMITTED REINSURANCE
A. SECURITY REQUIREMENT. In the event that the Cedent shall, at any time,
notify the Reinsurer of its determination that security for reinsurance
recoverables hereunder is or may be necessary for the Cedent to obtain
any associated regulatory statement credit for reinsurance ceded to
this Agreement on account of the Reinsurer being neither admitted or
accredited as a reinsurer, the Reinsurer shall establish a trust ("the
Trust") in accordance with Section B of this Article or the Reinsurer
shall provide a letter of credit (an "LOC") in accordance with Section
C of this Article.
B. TRUST AGREEMENT.
1. Except as may be provided in Section C of this Article, the
Cedent and the Reinsurer shall enter in to a Trust Agreement
that complies with regulations of the domicilliary state of
the Cedent, establishing a Trust Account for the benefit of
the Cedent to cover the recoverables and/or Statutory Reserves
attributable to the Reinsured Policies. The Trustee shall be a
bank, acceptable to each party, that is organized in the
United States; that is regulated, supervised and examined by
federal or state banking regulatory authorities; and that
meets any other applicable regulatory financial condition
standards. The bank shall not be a parent, subsidiary or
affiliate of the Cedent or Reinsurer.
2. This Trust Agreement is intended to secure Annual Statement
credit for reinsurance ceded by the Cedent to the Reinsurer in
accordance with regulations of the domiciliary state of the
Cedent and, in the event that the parties fail to enter into
the Trust Agreement and fund the Trust Account, as provided
herein, within five (5) working days after this Agreement
shall have been signed by both parties, this Agreement, unless
the parties otherwise provide, shall be null and void.
3. Assets having a value at least equal to 102% of the Statutory
Reserves attributable to the Reinsured Policies shall be
deposited into the Trust Account and maintained at all times
until its dissolution. Assets deposited in the Trust Account
shall be valued according to their current fair market value,
as determined under the statutory accounting rules of the
domiciliary state of the Cedent, and shall consist only of
cash (United States legal tender) and such domiciliary state
statutorily permitted investments that are not issued by a
parent, subsidiary or affiliate of either party.
4. Prior to depositing assets with the Trustee, the Reinsurer
shall execute assignments, endorsements in blank or transfer
legal title to the Trustee of all shares, obligations or any
other assets requiring assignment in order that the Cedent or
the Trustee, upon direction of the Cedent, may, whenever,
necessary, negotiate any such assets without consent or
signature from the Reinsurer of an other person or entity,
other than the Trustee, in accordance with the terms of the
Trust Agreement.
Page 33
5. Assets in the Trust Account, established hereunder, may be
withdrawn by the Cedent at any time, notwithstanding any other
provisions of this Agreement, and shall be utilized and
applied by the Cedent or any successor of the Company by
operation of law, including without limitation any liquidator,
rehabilitator, receiver or conservator of the Cedent, without
diminution because of insolvency on the part of the Ceding
Company or the Reinsurer, only for the following purposes:
i. to reimburse the Cedent for the Reinsurer's share of
premiums returned to the owners of the Policies on
account of cancellations of such Policies;
ii. to reimburse the Cedent for the Reinsurer's share of
benefits claims paid by the Cedent under the terms
and provisions of the Policies;
iii. to fund an account with the Cedent in an amount at
least equal to the ceded reinsurance deduction from
the Cedents Policy liabilities hereunder, which
amount shall include, but not be limited to, reserves
for benefit claims incurred (including benefit claims
incurred but not reported)
iv. to pay any other amounts that the Cedent claims to be
due hereunder
6. With the approval of the Cedent, the Reinsurer may withdraw
from the Trust Account all or any part of the assets contained
therein and transfer such assets to the Reinsurer; provided
i. the Reinsurer shall, at the time of such withdrawal,
replace the withdrawn assets with other qualified
assets having a market value equal to the market
value of the assets withdrawn so as to maintain the
Trust Account at the required amount at all times; or
ii. after such withdrawals and transfers, the market
value of the Trust Account is not less than 102% of
the required amount.
The Cedent shall be the sole judge as to the application of
this provision, but shall not unreasonably or arbitrarily
withhold its approval.
7. The Cedent will return any amounts drawn on the LOC in excess
of the actual amounts required for subparagraphs (i), (ii) and
(iv) of paragraph 5 or, in the case of subparagraph (iii) of
paragraph 5, any amounts that are subsequently determined not
to be due. The Cedent will pay interest on amounts withdrawn
in excess of the actual amount required under subparagraph
(iii) of paragraph 5 at a rate equal to the "Prime Rate"
published in The Wall Street Journal (currently the base rate
on corporate loans posted by at least 75% of the nation's 30
largest banks), which rate shall be adjusted on the last day
of each month; and
8. All of the foregoing provisions are to be applied without
diminution because of insolvency on the part of either party.
Page 34
C. Letters of Credit.
1. The Reinsurer will provide an LOC that complies with
regulations of the domiciliary state of the Cedent.
2. The Reinsurer shall be the LOC applicant. The Trustee shall be
a bank, acceptable to each party, that is organized in the
United States; that is regulated, supervised and examined by
federal or state banking regulatory authorities; and that
meets National Association of Insurance
Commissioners-Securities Valuation Office standards for
acceptable LOC issuance. The bank shall not be a parent,
subsidiary or affiliate of the Cedent or Reinsurer.
3. The LOC may be drawn at any time, notwithstanding any other
provisions herein and may be utilized by the Cedent or any
successor by operation of law, including without limitation
any liquidator, rehabilitator or receiver of the Cedent for
the following purposes:
i. to reimburse the Cedent for the Reinsurer's share of
Policy premiums returned on account of cancellations;
ii. to reimburse the Cedent for the Reinsurer's share of
benefit claims paid by the Cedent under the terms and
provisions of the Policies;
iii. to fund an account with the Cedent in an amount at
least equal to the ceded reinsurance deduction from
the Cedents Policy liabilities hereunder, which
amount shall include, but not be limited to, reserves
for benefit claims incurred (including benefit claims
incurred but not reported)
iv. to pay any other amounts that the Cedent claims to be
due hereunder
4. The Cedent will return any amounts drawn on the LOC in excess
of the actual amounts required for subparagraphs (i), (ii) and
(iv) of this paragraph or, in the case of subparagraph (iii)
of this paragraph, any amounts that are subsequently
determined not to be due. The Cedent will pay interest on
amounts withdrawn in excess of the actual amount required
under subparagraph (iii) at a rate equal to the "Prime Rate"
published in The Wall Street Journal (currently the base rate
on corporate loans posted by at least 75% of the nation's 30
largest banks), which rate shall be adjusted on the last day
of each month; and
(e) All of the foregoing provisions are to be applied without
diminution because of insolvency on the part of either party.
Page 35
ARTICLE XXII
CEDENT REPRESENTATIONS AND WARRANTIES
The Cedent represents and warrants, to the best of its knowledge, the following:
1. CORPORATE STATUS. The Cedent is duly licensed, qualified or admitted to
do business and is in good standing in all jurisdictions in which it is
required to be so qualified, licensed or admitted to do business by the
laws thereof.
2. AUTHORITY. The Cedent has the full corporate power and authority to
carry out and perform its undertakings and obligations under this
Agreement. This Agreement has been duly and validly signed and
delivered by the Cedent. The Cedent shall maintain in force all such
legal and regulatory authorizations as may be reasonably necessary or
appropriate for the performance of its obligations under this
Agreement.
3. OTHER REINSURANCE. The Cedent maintains the right to enter into other
reinsurance agreements affecting the Policies reinsured. However, the
Cedent will maintain net for it's own account at least a 10% quota
share of risk.
4. TAX STATUS. The Cedent represents and warrants that it is subject to U.
S. taxation under Subchapter L of Chapter 1 of the Code.
Page 36
ARTICLE XXIII
REINSURER REPRESENTATIONS AND WARRANTIES
The Reinsurer represents and warrants, to the best of its knowledge, the
following:
1. CORPORATE STATUS. The Reinsurer is duly licensed, qualified or admitted
to do exempt insurance business and is in good standing in ▇▇▇▇▇▇▇▇,
Bermuda.
2. AUTHORITY. The Reinsurer has the full corporate power and authority to
carry out and perform its undertakings and obligations under this
Agreement. This Agreement has been duly and validly signed and
delivered by the Reinsurer. The Reinsurer shall at maintain in force
all such legal and regulatory authorizations as may be reasonably
necessary or appropriate for the performance of its obligations under
this Agreement.
3. LICENSE STATUS. The Reinsurer is not an authorized insurer or
accredited reinsurer in Missouri. The Reinsurer shall notify the Ceding
Company within five (5) days after the date of any change in its
status.
4. TAX STATUS. The Reinsurer is subject to U.S. taxation under Subchapter
L of Chapter 1 or Subpart F of Part II of Subchapter N or Chapter 1 of
the Internal Revenue Code.
Page 37
IN WITNESS WHEREOF, the parties have caused this Agreement to be signed as of
the date first above written.
METLIFE INVESTORS USA INSURANCE COMPANY
By:
---------------------------------------
Title:
-------------------------------------
EXETER REASSURANCE COMPANY, LTD.
By:
---------------------------------------
Title:
-------------------------------------
Schedule A Plans of Reinsurance
Schedule B Investment Funds
Schedule C Required Data and Suggested Layout
Exhibit I 1994 Variable Annuity MGDB Mortality Tables
Mortality Table - Income Program (Annuity 2000 Valuation)
Projection Scale G
Exhibit II Reinsurance Premiums
Page 38
SCHEDULE A
PLANS OF REINSURANCE
A. Reinsurer's Percentage:
100% of the Cedent's 25% share of the business described herein.
B. Effective Date:
April 1, 2001, contingent upon the Reinsurer's review and acceptance of
business issued from April 1, 2001 to June 30, 2001.
Otherwise, July 1, 2001.
C. Death Benefits Ceded:
Guaranteed Minimum Death Benefits (GMDB)
----------------------------------------
o Annual Step-Up Benefit for issue ages 0-79: Greater Maximum
Anniversary Value to attained age 80; GMDB frozen thereafter.
o Greater of 5% Index and Annual Step-Up for issues ages 0-79:
Greater maximum Anniversary Value to attained age 80 and 5%
Rollup to attained age 80; GMDB frozen thereafter.
Note: Withdrawals reduce the death benefit proportionately.
Earnings Preservation Benefits (EPB)
------------------------------------
o Before the contract anniversary immediately prior to the
owner's 81st birthday, the EPB is,
40% of (a) - (b) for issue ages 0-69
25% of (a) - (b) for issue ages 70-79, where
(a) is the death benefit under the contract, and
(b) is the total Purchase Payments not withdrawn. For purposes
of calculating this value, partial withdrawals are first
applied against earnings in the contract (Earnings are equal
to the Account Value less Purchase Payments not withdrawn),
and then against Purchase Payments not withdrawn.
o On or after the contract anniversary immediately prior to the
owner's 81st birthday, the EPB is,
40% of (a) - (b) for issue ages 0-69
25% of (a) - (b) for issue ages 70-79, where
Page 39
SCHEDULE A
PLANS OF REINSURANCE
(PAGE 2 OF 3)
(a) is the death benefit under the contract anniversary
immediately prior to the owner's 81st birthday, increased by
subsequent Purchase Payments and reduced proportionately by
the percentage reduction in Account Value attributable to each
subsequent partial withdrawal; and
(b) is the total Purchase Payments not withdrawn. For purposes
of calculating this value, partial withdrawals are first
applied against earnings in the contract (Earnings are equal
to the Account Value less Purchase Payments not withdrawn),
and then against Purchase Payments not withdrawn.
Gain = (a) - (b) as defined above.
D. GMIB (Contractual Income Program Benefit) Ceded:
Income Benefit Base (IBB)
-------------------------
Greater of an Annual Ratchet to attained age 80 and a 6% Rollup to
attained age 80; frozen thereafter. The IBB is reduced proportionately
for withdrawals.
Waiting Period
--------------
Contractholders can elect to annuitize under the Income Program thirty
(30) days prior to their tenth (10th) or later contract anniversary and
also under one of the life annuity forms stated in Article IV.
Annuitization
-------------
Annuitization under the Income Program means that the annuitant is
receiving guaranteed fixed income payments based on the IBB and the
MAPR under one of the life annuity forms shown below under Paragraph E.
Income Program Rider Election
-----------------------------
The contractholder can only elect the Income Program Rider at issue.
Once election is made, it is irrevocable.
Income Program Rider Cancellation
---------------------------------
The contractholder of the annuity can not cancel the Income Program
rider at any time.
Step-Up or Reset of IBB
-----------------------
Not Available.
Page 40
SCHEDULE A
PLANS OF REINSURANCE
(PAGE 3 OF 3)
E. Affiliated Companies and Related Contracts:
Deferred Annuity Contracts
--------------------------
Standard Contract (7-year surrender charge schedule),
Bonus Contract (9-year surrender charge schedule)
L Class Contract (3-year surrender charge schedule)
C Class Contract (No surrender charges)
Form Numbers
------------
METLIFE INVESTORS INSURANCE COMPANY USA
1. Death Benefit Rider (Greater of annual Step-Up and 5% Annual
Increase), Form 8016(11/00)
2. Death Benefit Rider (Annual Step-Up) Form 8017 (11/00)
3. Additional Death Benefit Rider Form 8019 (11/00)
4. Guaranteed Minimum Income Benefit Form 8018 (11/00)
Page 41
SCHEDULE B
INVESTMENT FUNDS
------------------------------------------- ------------------------------------
FUNDS STATUS CHANGES
--------------------------------------------------------------------------------
------------------------------------------- ------------------------------------
Lord ▇▇▇▇▇▇ Growth & Income
------------------------------------------- ------------------------------------
Lord ▇▇▇▇▇▇ Bond Debenture
------------------------------------------- ------------------------------------
Lord ▇▇▇▇▇▇ Mid Cap Value
------------------------------------------- ------------------------------------
Lord ▇▇▇▇▇▇ Developing Growth
------------------------------------------- ------------------------------------
Lord ▇▇▇▇▇▇ Growth Opportunities
------------------------------------------- ------------------------------------
▇.▇. ▇▇▇▇▇▇ Quality Bond
------------------------------------------- ------------------------------------
▇.▇. ▇▇▇▇▇▇ Small Cap
------------------------------------------- ------------------------------------
▇. ▇. ▇▇▇▇▇▇ Select Equity
------------------------------------------- ------------------------------------
▇.▇. ▇▇▇▇▇▇ Enhanced Index
------------------------------------------- ------------------------------------
▇.▇. ▇▇▇▇▇▇ International
------------------------------------------- ------------------------------------
BlackRock Equity
------------------------------------------- ------------------------------------
BlackRock Government Income
------------------------------------------- ------------------------------------
Firstar Balanced
------------------------------------------- ------------------------------------
Firstar Equity Income
------------------------------------------- ------------------------------------
Firstar Growth & Income
------------------------------------------- ------------------------------------
Janus Aggressive Growth
------------------------------------------- ------------------------------------
MFS Mid Cap Growth
------------------------------------------- ------------------------------------
MFS Research International
------------------------------------------- ------------------------------------
▇▇▇▇▇▇▇▇▇▇▇ Capital Appreciation
------------------------------------------- ------------------------------------
PIMCO Money Market
------------------------------------------- ------------------------------------
PIMCO Total Return
------------------------------------------- ------------------------------------
PIMCO Innovation
------------------------------------------- ------------------------------------
▇▇▇▇▇▇ Research
------------------------------------------- ------------------------------------
Page 42
SCHEDULE C
REQUIRED DATA AND SUGGESTED DATA LAYOUT
(Page 1 of 3)
FIELD DESCRIPTION COMMENTS
----------------- --------
Annuitant's ID: Last Name
First Name
Middle Name
Sex M or F
Date of Birth YYYYMMDD
Social Security No. / Social Insurance No.
Joint Annuitant's ID: Last Name If Applicable
First Name
Middle Name
Sex M or F
Date of Birth YYYYMMDD
Social Security No. / Social Insurance No.
Owner's ID: Last Name
First Name
Middle Name
Sex M or F
Date of Birth YYYYMMDD
Social Security No. / Social Insurance No.
Joint Owner's ID: Last Name If Applicable
First Name
Middle Name
Sex M or F
Date of Birth YYYYMMDD
Social Security No. / Social Insurance No.
Policy Number
Policy Issue Date YYYYMMDD
Policy Issue Status NI = True New Issue, SC = Spousal Continuance,
EX = 1035 Exchange
Tax Status Qualified (Q), or Non-qualified (N)
Page 43
SCHEDULE C
REQUIRED DATA AND SUGGESTED DATA LAYOUT
(PAGE 2 OF 3)
FIELD DESCRIPTION COMMENTS
----------------- --------
GMDB/EEB SECTION (If applicable)
--------------------------------
Mortality Risk Definition Indicator AV = VNAR; CV = VNAR + SCNAR
Death Claim Trigger A = Annuitant, O = Owner, 1 = 1st to die, 2 = 2nd to die
(e.g., A2 = payable upon death of second of joint annuitants)
Current Ratchet Value If Applicable
Current Reset Value If Applicable
Current Rollup Value If Applicable
Current Return of Premium Value If Applicable
Minimum Guaranteed Death Benefit
Contract Death Benefit Greater of Account Value and Minimum Guaranteed Death Benefit
Effective Date of the Rider
Account Value as of the Effective Date of the Rider
Mortality Risk VNAR Max [Contractual Death Benefit - Account Value), 0]
SCNAR Surrender Charge, if applicable
EEMNAR X% of Death Benefit less Net Purchase Payments
Earnings Death Benefit less Net Purchase Payments
Earnings CAP X% of Net Purchase Payments
GMIB SECTION (If applicable)
----------------------------
GMIB Indicator Y = benefit elected, N = benefit not elected, NA = not applicable
Income Benefit Elected 01 = option 1, 02 = option 2, etc.
Expiration of Waiting Period YYYYMMDD
GMIB Annuitization Date YYYYMMDD - actual date
Most Recent GMIB Step-up / Reset Date YYYYMMDD, if applicable
Cancellation Date YYYYMMDD, if applicable
Pricing Cohort Indicator
IBB Amount
GMIB IBNAR Amount Calculated using an individual life annuity form with 10 years certain
Treasury Rate Used in IBNAR calculation
GMAB SECTION (If applicable)
----------------------------
GMAB Indicator Y = benefit elected, N = benefit not elected, NA = not applicable
Accumulation Benefit Elected 01 = option 1, 02 = option 2, etc.
Maturity Date YYYYMMDD
Most Recent GMAB Step-up / Rollover Date YYYYMMDD, if applicable
Cancellation Date YYYYMMDD, if applicable
Pricing Cohort Indicator
GMAB Guaranteed Value Current Value
GMAB NAR Max [ (GMAB Guaranteed Value - Account Value) , 0]
Account Value Current total value
Surrender Charge If reinsured
Cumulative Deposits Total premiums
Cumulative Withdrawals Total withdrawals
Net Purchase Payments Total premiums less total withdrawals (proportional adjustment)
Deposits made in quarter of death dollar value
Quota Share ceded percentage
Page 44
SCHEDULE C
REQUIRED DATA AND SUGGESTED DATA LAYOUT
(PAGE 3 OF 3)
FIELD DESCRIPTION COMMENTS
----------------- --------
Funding Vehicle Values:
"MorningStar" designations (US)
Aggressive Growth
Balanced
Corporate Bond
Government Bond
Growth
Growth and Income
High Yield Bond
International Bond
International Stock
Money Market
Specialty Fund
Fixed Account
Dollar Cost Averaging
Note: total of funding vehicles should equal account value.
Termination Information:
------------------------
Termination Date YYYYMMDD, If applicable
Reason for Termination Death (D), Annuitization (A), 1035 Exchange (X), GMIB Election (I), Other (O).
Cause of Death If applicable. Use your Cause of Death code, and provide translation
Summary Information: For reconciliation purposes (may be paper summary)
--------------------
Total number of records Monthly aggregate information by GMIB Design, GMAB Design, and
Pricing Cohort (if applicable)
Total of each dollar field Monthly aggregate information by GMIB Design, GMAB Design, and
Pricing Cohort (if applicable)
Note: All values to nearest dollar
Page 45
EXHIBIT I
1994 VARIABLE ANNUITY MGDB MORTALITY TABLE
(APPLIED AGE LAST BIRTHDAY AT ATTAINED AGE)
============================================= ===========================================
Attained Age Male Qx Female Qx Attained Age Male Qx Female Qx
--------------------------------------------- -------------------------------------------
1 0.000587 0.000519 60 0.010029 0.005636
--------------------------------------------- -------------------------------------------
2 0.000433 0.000358 61 0.011312 0.006460
--------------------------------------------- -------------------------------------------
3 0.000350 0.000268 62 0.012781 0.007396
--------------------------------------------- -------------------------------------------
4 0.000293 0.000218 63 0.014431 0.008453
--------------------------------------------- -------------------------------------------
5 0.000274 0.000201 64 0.016241 0.009611
--------------------------------------------- -------------------------------------------
6 0.000263 0.000188 65 0.018191 0.010837
--------------------------------------------- -------------------------------------------
7 0.000248 0.000172 66 0.020259 0.012094
--------------------------------------------- -------------------------------------------
8 0.000234 0.000158 67 0.022398 0.013318
--------------------------------------------- -------------------------------------------
9 0.000231 0.000154 68 0.024581 0.014469
--------------------------------------------- -------------------------------------------
10 0.000239 0.000159 69 0.026869 0.015631
--------------------------------------------- -------------------------------------------
11 0.000256 0.000169 70 0.029363 0.016957
--------------------------------------------- -------------------------------------------
12 0.000284 0.000185 71 0.032169 0.018597
--------------------------------------------- -------------------------------------------
13 0.000327 0.000209 72 0.035268 0.020599
--------------------------------------------- -------------------------------------------
14 0.000380 0.000239 73 0.038558 0.022888
--------------------------------------------- -------------------------------------------
15 0.000435 0.000271 74 0.042106 0.025453
--------------------------------------------- -------------------------------------------
16 0.000486 0.000298 75 0.046121 0.028372
--------------------------------------------- -------------------------------------------
17 0.000526 0.000315 76 0.050813 0.031725
--------------------------------------------- -------------------------------------------
18 0.000558 0.000326 77 0.056327 0.035505
--------------------------------------------- -------------------------------------------
19 0.000586 0.000333 78 0.062629 0.039635
--------------------------------------------- -------------------------------------------
20 0.000613 0.000337 79 0.069595 0.044161
--------------------------------------------- -------------------------------------------
21 0.000642 0.000340 80 0.077114 0.049227
--------------------------------------------- -------------------------------------------
22 0.000677 0.000343 81 0.085075 0.054980
--------------------------------------------- -------------------------------------------
23 0.000717 0.000344 82 0.093273 0.061410
--------------------------------------------- -------------------------------------------
24 0.000760 0.000344 83 0.101578 0.068384
--------------------------------------------- -------------------------------------------
25 0.000803 0.000346 84 0.110252 0.075973
--------------------------------------------- -------------------------------------------
26 0.000842 0.000352 85 0.119764 0.084432
--------------------------------------------- -------------------------------------------
27 0.000876 0.000364 86 0.130583 0.094012
--------------------------------------------- -------------------------------------------
28 0.000907 0.000382 87 0.143012 0.104874
--------------------------------------------- -------------------------------------------
29 0.000935 0.000403 88 0.156969 0.116968
--------------------------------------------- -------------------------------------------
30 0.000959 0.000428 89 0.172199 0.130161
--------------------------------------------- -------------------------------------------
31 0.000981 0.000455 90 0.188517 0.144357
--------------------------------------------- -------------------------------------------
32 0.000997 0.000484 91 0.205742 0.159461
--------------------------------------------- -------------------------------------------
33 0.001003 0.000514 92 0.223978 0.175424
--------------------------------------------- -------------------------------------------
34 0.001005 0.000547 93 0.243533 0.192270
--------------------------------------------- -------------------------------------------
Page 46
--------------------------------------------- -------------------------------------------
35 0.001013 0.000585 94 0.264171 0.210032
--------------------------------------------- -------------------------------------------
36 0.001037 0.000628 95 0.285199 0.228712
--------------------------------------------- -------------------------------------------
37 0.001082 0.000679 96 0.305931 0.248306
--------------------------------------------- -------------------------------------------
38 0.001146 0.000739 97 0.325849 0.268892
--------------------------------------------- -------------------------------------------
39 0.001225 0.000805 98 0.344977 0.290564
--------------------------------------------- -------------------------------------------
40 0.001317 0.000874 99 0.363757 0.313211
--------------------------------------------- -------------------------------------------
41 0.001424 0.000943 100 0.382606 0.336569
--------------------------------------------- -------------------------------------------
42 0.001540 0.001007 101 0.401942 0.360379
--------------------------------------------- -------------------------------------------
43 0.001662 0.001064 102 0.422569 0.385051
--------------------------------------------- -------------------------------------------
44 0.001796 0.001121 103 0.445282 0.411515
--------------------------------------------- -------------------------------------------
45 0.001952 0.001186 104 0.469115 0.439065
--------------------------------------------- -------------------------------------------
46 0.002141 0.001269 105 0.491923 0.465584
--------------------------------------------- -------------------------------------------
47 0.002366 0.001371 106 0.511560 0.488958
--------------------------------------------- -------------------------------------------
48 0.002618 0.001488 107 0.526441 0.507867
--------------------------------------------- -------------------------------------------
49 0.002900 0.001619 108 0.536732 0.522924
--------------------------------------------- -------------------------------------------
50 0.003223 0.001772 109 0.543602 0.534964
--------------------------------------------- -------------------------------------------
51 0.003598 0.001952 110 0.547664 0.543622
--------------------------------------------- -------------------------------------------
52 0.004019 0.002153 111 0.549540 0.548526
--------------------------------------------- -------------------------------------------
53 0.004472 0.002360 112 0.550000 0.550000
--------------------------------------------- -------------------------------------------
54 0.004969 0.002589 113 0.550000 0.550000
--------------------------------------------- -------------------------------------------
55 0.005543 0.002871 114 0.550000 0.550000
--------------------------------------------- -------------------------------------------
56 0.006226 0.003241 115 1.000000 1.000000
--------------------------------------------- -------------------------------------------
57 0.007025 0.003713
--------------------------------------------- -------------------------------------------
58 0.007916 0.004270
--------------------------------------------- -------------------------------------------
59 0.008907 0.004909
============================================= ===========================================
Page 47
EXHIBIT I
MORTALITY TABLE - INCOME PROGRAM
--------------------------------------------------------------------------
2000 VALUATION (PER THOUSAND RATES)
(APPLIES AT ATTAINED AGE)
--------------------------------------------------------------------------
================================== ==================================
Age Male - qx's Female - qx's Age Male - qx's Female - qx's
================================== ==================================
5 0.291 0.171 60 6.428 3.863
---------------------------------- ----------------------------------
6 0.270 0.141 61 6.933 4.242
---------------------------------- ----------------------------------
7 0.257 0.118 62 7.520 4.668
---------------------------------- ----------------------------------
8 0.294 0.118 63 8.207 5.144
---------------------------------- ----------------------------------
9 0.325 0.121 64 9.008 5.671
---------------------------------- ----------------------------------
10 0.350 0.126 65 9.940 6.250
---------------------------------- ----------------------------------
11 0.371 0.133 66 11.016 6.878
---------------------------------- ----------------------------------
12 0.388 0.142 67 12.251 7.555
---------------------------------- ----------------------------------
13 0.402 0.152 68 13.657 8.287
---------------------------------- ----------------------------------
14 0.414 0.164 69 15.233 9.102
---------------------------------- ----------------------------------
15 0.425 0.177 70 16.979 10.034
---------------------------------- ----------------------------------
16 0.437 0.190 71 18.891 11.117
---------------------------------- ----------------------------------
17 0.449 0.204 72 20.967 12.386
---------------------------------- ----------------------------------
18 0.463 0.219 73 23.209 13.871
---------------------------------- ----------------------------------
19 0.480 0.234 74 25.644 15.592
---------------------------------- ----------------------------------
20 0.499 0.250 75 28.304 17.564
---------------------------------- ----------------------------------
21 0.519 0.265 76 31.220 19.805
---------------------------------- ----------------------------------
22 0.542 0.281 77 34.425 22.328
---------------------------------- ----------------------------------
23 0.566 0.298 78 37.948 25.158
---------------------------------- ----------------------------------
24 0.592 0.314 79 41.812 28.341
---------------------------------- ----------------------------------
25 0.616 0.331 80 46.037 31.933
---------------------------------- ----------------------------------
26 0.639 0.347 81 50.643 35.985
---------------------------------- ----------------------------------
27 0.659 0.362 82 55.651 40.552
---------------------------------- ----------------------------------
28 0.675 0.376 83 61.080 45.690
---------------------------------- ----------------------------------
29 0.687 0.389 84 66.948 51.456
---------------------------------- ----------------------------------
30 0.694 0.402 85 73.275 57.913
---------------------------------- ----------------------------------
31 0.699 0.414 86 80.076 65.119
---------------------------------- ----------------------------------
32 0.700 0.425 87 87.370 73.136
---------------------------------- ----------------------------------
33 0.701 0.436 88 95.169 81.991
---------------------------------- ----------------------------------
34 0.702 0.449 89 103.455 91.577
---------------------------------- ----------------------------------
35 0.704 0.463 90 112.208 101.758
---------------------------------- ----------------------------------
36 0.719 0.481 91 121.402 112.395
---------------------------------- ----------------------------------
37 0.749 0.504 92 131.017 123.349
---------------------------------- ----------------------------------
Page 48
---------------------------------- ----------------------------------
38 0.796 0.532 93 141.030 134.486
---------------------------------- ----------------------------------
39 0.864 0.567 94 151.422 145.689
---------------------------------- ----------------------------------
40 0.953 0.609 95 162.179 156.846
---------------------------------- ----------------------------------
41 1.065 0.658 96 173.279 167.841
---------------------------------- ----------------------------------
42 1.201 0.715 97 184.706 178.563
---------------------------------- ----------------------------------
43 1.362 0.781 98 196.946 189.604
---------------------------------- ----------------------------------
44 1.547 0.855 99 210.484 201.557
---------------------------------- ----------------------------------
45 1.752 0.939 100 225.806 215.013
---------------------------------- ----------------------------------
46 1.974 1.035 101 243.398 230.565
---------------------------------- ----------------------------------
47 2.211 1.141 102 263.745 248.805
---------------------------------- ----------------------------------
48 2.460 1.261 103 287.334 270.326
---------------------------------- ----------------------------------
49 2.721 1.393 104 314.649 295.719
---------------------------------- ----------------------------------
50 2.994 1.538 105 346.177 325.576
---------------------------------- ----------------------------------
51 3.279 1.695 106 382.403 360.491
---------------------------------- ----------------------------------
52 3.576 1.864 107 423.813 401.054
---------------------------------- ----------------------------------
53 3.884 2.047 108 470.893 447.860
---------------------------------- ----------------------------------
54 4.203 2.244 109 524.128 501.498
---------------------------------- ----------------------------------
55 4.534 2.457 110 584.004 562.563
---------------------------------- ----------------------------------
56 4.876 2.689 111 651.007 631.645
---------------------------------- ----------------------------------
57 5.228 2.942 112 725.622 709.338
---------------------------------- ----------------------------------
58 5.593 3.218 113 808.336 796.233
---------------------------------- ----------------------------------
59 5.988 3.523 114 899.633 892.923
---------------------------------- ----------------------------------
115 1000.000 1000.000
================================== ==================================
Page 49
EXHIBIT I
PROJECTION SCALE G
------------------------------------ ------------------------------------ -----------------------------------
Age Male Female Age Male Female Age Male Female
==================================== ==================================== ===================================
5 1.50% 1.50% 53 1.70% 1.95% 101 0.20% 0.25%
------------------------------------ ------------------------------------ -----------------------------------
6 1.50% 1.50% 54 1.65% 1.90% 102 0.00% 0.00%
------------------------------------ ------------------------------------ -----------------------------------
7 1.50% 1.50% 55 1.60% 1.85% 103 0.00% 0.00%
------------------------------------ ------------------------------------ -----------------------------------
8 1.25% 1.40% 56 1.55% 1.80% 104 0.00% 0.00%
------------------------------------ ------------------------------------ -----------------------------------
9 1.00% 1.30% 57 1.50% 1.75% 105 0.00% 0.00%
------------------------------------ ------------------------------------ -----------------------------------
10 0.75% 1.20% 58 1.50% 1.75% 106 0.00% 0.00%
------------------------------------ ------------------------------------ -----------------------------------
11 0.50% 1.10% 59 1.50% 1.75% 107 0.00% 0.00%
------------------------------------ ------------------------------------ -----------------------------------
12 0.25% 1.00% 60 1.50% 1.75% 108 0.00% 0.00%
------------------------------------ ------------------------------------ -----------------------------------
13 0.24% 0.90% 61 1.50% 1.75% 109 0.00% 0.00%
------------------------------------ ------------------------------------ -----------------------------------
14 0.23% 0.80% 62 1.50% 1.75% 110 0.00% 0.00%
------------------------------------ ------------------------------------ -----------------------------------
15 0.22% 0.70% 63 1.50% 1.75% 111 0.00% 0.00%
------------------------------------ ------------------------------------ -----------------------------------
16 0.21% 0.60% 64 1.50% 1.75% 112 0.00% 0.00%
------------------------------------ ------------------------------------ -----------------------------------
17 0.20% 0.50% 65 1.50% 1.75% 113 0.00% 0.00%
------------------------------------ ------------------------------------ -----------------------------------
18 0.18% 0.50% 66 1.50% 1.75% 114 0.00% 0.00%
------------------------------------ ------------------------------------ -----------------------------------
19 0.16% 0.50% 67 1.50% 1.75% 115 0.00% 0.00%
------------------------------------ ------------------------------------ -----------------------------------
20 0.14% 0.50% 68 1.45% 1.75%
------------------------------------ ------------------------------------ -----------------------------------
21 0.12% 0.50% 69 1.40% 1.75%
------------------------------------ ------------------------------------ -----------------------------------
22 0.10% 0.50% 70 1.35% 1.75%
------------------------------------ ------------------------------------ -----------------------------------
23 0.10% 0.55% 71 1.30% 1.75%
------------------------------------ ------------------------------------ -----------------------------------
24 0.10% 0.60% 72 1.25% 1.75%
------------------------------------ ------------------------------------ -----------------------------------
25 0.10% 0.65% 73 1.25% 1.70%
------------------------------------ ------------------------------------ -----------------------------------
26 0.10% 0.70% 74 1.25% 1.65%
------------------------------------ ------------------------------------ -----------------------------------
27 0.10% 0.75% 75 1.25% 1.60%
------------------------------------ ------------------------------------ -----------------------------------
28 0.23% 0.85% 76 1.25% 1.55%
------------------------------------ ------------------------------------ -----------------------------------
29 0.36% 0.95% 77 1.25% 1.50%
------------------------------------ ------------------------------------ -----------------------------------
30 0.49% 1.05% 78 1.25% 1.50%
------------------------------------ ------------------------------------ -----------------------------------
31 0.62% 1.15% 79 1.25% 1.50%
------------------------------------ ------------------------------------ -----------------------------------
32 0.75% 1.25% 80 1.25% 1.50%
------------------------------------ ------------------------------------ -----------------------------------
33 1.00% 1.45% 81 1.25% 1.50%
------------------------------------ ------------------------------------ -----------------------------------
34 1.25% 1.65% 82 1.25% 1.50%
------------------------------------ ------------------------------------ -----------------------------------
35 1.50% 1.85% 83 1.25% 1.50%
------------------------------------ ------------------------------------ -----------------------------------
36 1.75% 2.05% 84 1.25% 1.50%
------------------------------------ ------------------------------------ -----------------------------------
37 2.00% 2.25% 85 1.25% 1.50%
------------------------------------ ------------------------------------ -----------------------------------
38 2.00% 2.25% 86 1.25% 1.50%
------------------------------------ ------------------------------------ -----------------------------------
Page 50
------------------------------------ ------------------------------------ -----------------------------------
39 2.00% 2.25% 87 1.25% 1.50%
------------------------------------ ------------------------------------ -----------------------------------
40 2.00% 2.25% 88 1.20% 1.45%
------------------------------------ ------------------------------------ -----------------------------------
41 2.00% 2.25% 89 1.15% 1.40%
------------------------------------ ------------------------------------ -----------------------------------
42 2.00% 2.25% 90 1.10% 1.35%
------------------------------------ ------------------------------------ -----------------------------------
43 1.95% 2.20% 91 1.05% 1.30%
------------------------------------ ------------------------------------ -----------------------------------
44 1.90% 2.15% 92 1.00% 1.25%
------------------------------------ ------------------------------------ -----------------------------------
45 1.85% 2.10% 93 1.00% 1.25%
------------------------------------ ------------------------------------ -----------------------------------
46 1.80% 2.05% 94 1.00% 1.25%
------------------------------------ ------------------------------------ -----------------------------------
47 1.75% 2.00% 95 1.00% 1.25%
------------------------------------ ------------------------------------ -----------------------------------
48 1.75% 2.00% 96 1.00% 1.25%
------------------------------------ ------------------------------------ -----------------------------------
49 1.75% 2.00% 97 1.00% 1.25%
------------------------------------ ------------------------------------ -----------------------------------
50 1.75% 2.00% 98 0.80% 1.00%
------------------------------------ ------------------------------------ -----------------------------------
51 1.75% 2.00% 99 0.60% 0.75%
------------------------------------ ------------------------------------ -----------------------------------
52 1.75% 2.00% 100 0.40% 0.50%
------------------------------------ ------------------------------------ -----------------------------------
Page 51
EXHIBIT II
Page 52