Common use of Bank Accounts for Serviced Business Clause in Contracts

Bank Accounts for Serviced Business. (a) The Company will establish one or more bank accounts (each a “Collection Account”) into which the Administrator shall deposit the following amounts actually received by the Administrator with respect to the Serviced Business: (i) all amounts received as Premiums on the Net Retained Liabilities Policies, (ii) all amounts payable to the Company under Existing Reinsurance Agreements with respect to the Serviced Business, (iii) all other amounts payable to the Company in respect of the Serviced Business, and (iv) amounts payable by the Company pursuant to the last sentence of Section 3.9(b). The Administrator shall issue drafts and transfer funds from the Collection Account necessary to fund the Disbursement Accounts in accordance with Section 3.9(b). (b) The Company will establish one or more bank accounts (each a “Disbursement Account” and together with the Collection Account, the “Accounts”). The Administrator shall (x) designate the authorized signatories for the Accounts; (y) issue drafts and make deposits into and transfers from the Accounts in the name of the Company and (z) engage in all other transactions with respect to the Accounts necessary in connection with the Serviced Business. The Administrator will pay the following disbursements by check, draft, or electronic payment drawn on Disbursement Account: (i) all benefits, other payments and adjustments payable by the Company on account of the Serviced Business, (ii) all amounts required to be deposited into the Separate Accounts or Shared Separate Account pursuant to Section 3.3(c), (iii) all reinsurance premiums, modified coinsurance reserve adjustment, investment income on assets held by the Company and other amounts payable to the reinsurer by the Company on account of the Existing Reinsurance Agreements in respect of the Serviced Business, (iv) subject to Section 4.1, the fees payable to the Administrator in respect of the Serviced Business, and (v) upon the written request of the Company, amounts in the Collection Account to the extent exceeding the amount required to be maintained to fund the payments described in the foregoing clauses (i)-(iv) on an ongoing basis, as determined in the Company’s sole discretion. The Company name shall appear on the checks used for all payments made from the Disbursement Accounts. The Administrator will on each Business Day determine the amount required to be paid from the Disbursement Account on such day and will promptly only fund such amounts from the Collection Account to maintain the Disbursement Account at all times at zero. In the event that the balance in the Collection Account is insufficient to pay on behalf of the Company the amounts set forth above in respect of the Serviced Business and maintain the balance in the Disbursement Account at zero, the Company will, following notice by the Administrator, promptly fund any shortfall. (c) The Accounts are to be accessed by the Administrator for the sole purpose of making the deposits and disbursements described in the foregoing subsections (a) and (b), respectively, of this Section 3.9, and shall not be comingled with the Administrator’s other funds. Upon the termination of this Agreement under the provisions of Section 8.1, the Company shall be entitled to immediately revoke any and all authority of the Administrator with respect to the Accounts. The Administrator will provide the Company a monthly report of all receipts in and disbursements from the Collection Account and Disbursement Account in a form and in a time frame mutually agreed upon.