Funds Withheld. The Ceding Company shall withhold, on behalf of the Reinsurer, the Funds Withheld Assets. The payment of funds to and the holding of such funds by, the Ceding Company shall not create a trust or fiduciary relationship between the Ceding Company and the Reinsurer, but rather a relationship of debtor and creditor. The Reinsurer shall consider such amount as a receivable.
Funds Withheld a. Under the circumstances described in the ‘TOTAL SECURITY’ section of this Agreement, THE REINSURER may provide to THE COMPANY an amount of cash to be held on deposit (“Funds Withheld”) with respect to all the amounts recoverable from THE REINSURER under this Agreement so as to avoid triggering THE COMPANY’s right of recapture under the ‘RECAPTURE’ section of this Agreement. If THE REINSURER elects to do so, the Funds Withheld must satisfy the requirements of subsections b., c., and d. of this ‘FUNDS WITHHELD’ section.
b. THE REINSURER and THE COMPANY agree that any Funds Withheld provided by THE REINSURER pursuant to the provisions of this Agreement may be drawn upon by THE COMPANY in full or in part at any time, notwithstanding any other provisions of this Agreement, and may be utilized by THE COMPANY or any successor by operation of law of THE COMPANY including without limitation, any liquidator, rehabilitator, receiver or conservator of THE COMPANY for any of the following purposes:
i. to reimburse THE COMPANY for unearned reinsurance premiums on returned to the owners of policies reinsured under this Agreement on account of cancellations of such policies;
ii. to reimburse THE COMPANY for THE REINSURER’s share of benefits or losses paid by THE COMPANY under the terms and provisions of the policies reinsured under this Agreement;
iii. Any other amount necessary under THE COMPANY’s state of domicile to secure reserve credit for THE REINSURER’s proportionate share of the statutory reserves;
iv. to pay any other amounts THE COMPANY claims are due under this Agreement: All of the foregoing will be applied without diminution because of insolvency on the part of THE REINSURER.
c. At the end of each calendar quarter, THE COMPANY will credit interest on the Funds Withheld during the previous quarter. The amount of interest that THE COMPANY will credit will be based on the average amount of Funds Withheld over the quarter. The interest rate will be equal to the sum of the London Interbank Office Rate, U.S. Denomination-Fixed Twelve-month, (LIBOR) as of the beginning of the calendar quarter, plus ninety (90) basis points.
d. THE COMPANY agrees to return to THE REINSURER any Funds Withheld that are in excess of the actual amounts required. The Funds Withheld shall remain in effect until the later of the termination of this Reinsurance Agreement or the full satisfaction and discharge of any and all liabilities and obligations owed by THE REINSURER to THE COMPANY,...
Funds Withheld. Subject to the terms hereof, the Reinsured shall retain as fiduciary of the Reinsurer the reinsurance premium due hereunder on a funds withheld basis. The amount of such reinsurance premium so retained shall be called “Funds Withheld”. In consideration of the Reinsurer agreeing to allow the Reinsured to retain the reinsurance premium on funds withheld basis, the Reinsured agrees that the Funds Withheld Balance (as defined in Section 5.02) may be offset by the Reinsurer against liabilities of the Reinsurer for payments under this Agreement. The Funds Withheld Balance shall be maintained by the Reinsured in a segregated asset portfolio.
Funds Withheld. Subject to the terms herein, the Reinsured shall retain the Reinsurance Premium and Additional Premium, if any, due hereunder on a funds withheld basis, provided however, that the Reinsurer's Margin shall be paid in cash to the Reinsurer and shall not be affected by the terms of this "Funds Withheld" article. The amount of such withheld Reinsurance Premium, net of Reinsurer's Margin, and Additional Premium, if any, shall be called "FUNDS WITHHELD". In consideration of the Reinsurer agreeing to the Funds Withheld, the Reinsured agrees (i) to calculate a notional Funds Withheld account from the Effective Date of this Agreement until there is a complete and final release of all of the Reinsurer's obligations to the Reinsured under this Agreement and (ii) that the Funds Withheld Balance may be set off by the Reinsurer against liability of any nature whatsoever (whether then contingent, due and payable, or in the future becoming due) that the Reinsurer may then have, or in the future may have under this Agreement and (iii) that such setoff shall occur as a condition precedent to any payments by the Reinsurer hereunder. The balance of the Funds Withheld account (the "FUNDS WITHHELD BALANCE") as of any December 31 shall be defined as:
(1) Cumulative Reinsurance Premium plus Additional Premium, if any, due hereunder, less
(2) the Cumulative Reinsurer's Margin paid to the Reinsurer, less
(3) Cumulative Ultimate Net Loss paid (or offset) by the Reinsurer, plus
(4) the Cumulative Funds Withheld Investment Credit. The Reinsurance Premium, and Additional Premium, if any, shall be credited to the Funds Withheld Balance on the date such monies are payable. The Ultimate Net Loss due from the Reinsurer shall be charged against the Funds Withheld Balance on the date such monies are due and further subject to article entitled "REPORTS AND REMITTANCES". 12 For the purpose of calculating the balance of the Funds Withheld account, the Reinsurer's Margin shall be deemed to be deducted in proportion to and at the same time as the crediting to the Funds Withheld account of the Reinsurance Premium. The Funds Withheld investment credit (the "FUNDS WITHHELD INVESTMENT CREDIT") for each calendar year shall equal the average daily balance of the Funds Withheld account for that calendar year (or portion thereof), determined as if the Reinsurance Premium and Additional Premium, if any, as finally computed was paid on January 1, 1999, multiplied by 9% (or the pro-rata portion thereof). Th...
Funds Withheld. GELAAC shall retain the amounts calculated pursuant to Section 5.2 from the reinsurance premiums due Reinsurer (the “Funds Withheld”) as security for the performance of Reinsurer’s obligations hereunder.
Funds Withheld. Subject to the terms hereof, the Ceding Company shall retain, as fiduciary of the Reinsurer, the Reinsurance Settlements due hereunder on a funds withheld basis. The amount of such Reinsurance Settlements so retained shall be called “Funds Withheld”. In consideration of the Reinsurer agreeing to allow the Ceding Company to retain the Reinsurance Settlements on funds withheld basis, the Ceding Company agrees that the Funds Withheld Balance (as defined in Section 5.02) may be offset by the Reinsurer against liabilities of the Reinsurer for payments under this Agreement. The Funds Withheld Balance shall be maintained by the Ceding Company in a segregated asset portfolio.
Funds Withheld. The Ceding Company and the Reinsurer have entered into the "Accounts Receivable Agreement" attached to this Agreement as Exhibit A. Pursuant to the terms of the Accounts Receivable Agreement,
(i) equals the Funds Withheld at the end of the preceding Accounting Period; and
(ii) equals any payment by the Ceding Company to the Reinsurer of any amount withheld, as described in item (i) above, during the Accounting Period in accordance with the Accounts Receivable Agreement. With respect, however, to the Accounting Period during which the Effective Date of this Agreement occurs, the reference in (i) above to "the end of the preceding Accounting Period" means 3.2 percent of the Initial Consideration, but not to exceed $15 million, determined in accordance with Paragraph 1 above. In no event will the Funds Withheld at the end of any Accounting Period exceed 50 percent of the Ceding Company's total statutory capital and surplus as of the end of the preceding calendar year.
Funds Withheld. The Ceding Company and the Reinsurer have entered into the "Accounts Receivable Agreement" attached to this Agreement as Exhibit A. Pursuant to the terms of the Accounts Receivable Agreement, the Ceding Company will withhold on behalf
Funds Withheld. The Company will withhold funds from Life Re in an amount equal to the CARVM Account. The CARVM Account is the expense allowance provided by the use of the Commissioners Annuity Reserve Valuation method ("CARVM") or the Commissioners Reserve Valuation Method ("CRVM") and, at any point in time, is equal to the excess of the policyholder account value over the CARVM or CRVM reserves calculated. The calculated CARVM or CRVM reserves will be based on the regulatory requirements in the Company's State of domicile including, but not limited to, Actuarial Guideline 33 ("Determining CARVM Reserves for Annuity Contracts with Elective Benefits") and Actuarial Guideline 34 ("Variable Annuity Minimum Guaranteed Death Benefit Reserves").
Funds Withheld. (a) PTNAIC shall retain as security on a "Funds Withheld" basis from the Initial Premium payable to the Reinsurer the total sum of $56,000,000 of the Initial Premium. Such retained Initial Premium shall be held in a notional funds withheld account ("FWA") on a fiduciary basis as security in accordance with the provisions of Article 41 - Security, and in satisfaction of Reinsurer's obligations thereunder, subject further to the right to set off in accordance with Article 37 - Offset. The FWA shall accrue interest calculated in the manner provided for in paragraph (d) below. PTNAIC must reduce the amount retained in such FWA by remitting to the Reinsurer, in cash, within fifteen (15) business days of the dates indicated below, the following portions of the balance in the respective FWA at each date: December 31, 2003 1/6 December 31, 2004 1/5 December 31, 2005 1/4 December 31, 2006 1/3 December 31, 2007 1/2 December 31, 2008 100% Upon providing notification to Reinsurer of the Reinsureds' election to commute this Agreement, pursuant to Article 25 - Commutation, PTNAIC shall pay the balance of the FWA to the Reinsurer.
(b) PTNAIC is entitled to make earlier payments than scheduled in the preceding paragraph (a) at its sole discretion without penalty.
(c) Notwithstanding any other provision of this Agreement, the Reinsurer reserves the right at any time and for any reason (or for no reason) to terminate the FWA security arrangement and to demand that PTNAIC remit the then outstanding balance (inclusive of applicable interest calculated as provided for in paragraph (d) below) in the FWA by giving PTNAIC at least fifteen (15) business days prior written notice. In such event, PTNAIC shall immediately release such security and transfer the amount in the FWA to the Reinsurer as directed by the Reinsurer on the fifteenth (15th) business day following delivery of such demand from the Reinsurer.
(d) For so long as the FWA is maintained, PTNAIC, upon written request of the Reinsurer, shall offset Ultimate Net Loss and Reinsurance Allowance due and payable by the Reinsurer under this Agreement from the positive balance of funds maintained in the FWA. The Reinsurer shall be under no obligation to reimburse either Reinsured, any successor in interest or statutory receiver, liquidator, rehabilitator (or the like) for any Ultimate Net Loss or Reinsurance Allowance as long as there is a positive amount in the FWA.
(e) The FWA shall accrue interest at a rate calculated as fo...
