AMENDMENT NUMBER ONE TO
ASSUMPTION REINSURANCE AGREEMENT
This Amendment Number One to Assumption Reinsurance Agreement (the
"Amendment") is made and entered into as of the 5th day of September, 1997 by
and between Delta Agricultural and Industrial Trust, a Mississippi workers'
compensation self insured trust (the "Trust"); Stoneville Insurance Company, a
Mississippi stock insurance company ("Stoneville"); and Continental Casualty
Company, an Illinois stock insurance company ("Continental").
WHEREAS, the Trust, Stoneville and Continental entered into that
certain Assumption Reinsurance Agreement (the "Agreement") as of March 20, 1997,
for the purposes as set forth therein, and
WHEREAS, the parties have determined that it is in their mutual best
interest to amend the Agreement to remove the requirement for Stoneville to
provide Additional Collateral (as defined in the Agreement) to Continental as
well as to amend the Agreement as further set forth herein.
NOW, THEREFORE, in consideration of the foregoing premises and the
covenants, provisions and agreements set forth herein, the parties agree as
follows:
1. Section 1.3 is amended in its entirety to provide as follows:
"Continental Expense" means the sum of Two Hundred Fifty
Thousand Dollars ($250,000) which the Trust shall pay the Continental as a part
of the Premium.
2. Section 1.5 is amended in its entirety to provide as follows:
"Effective Date" means 12:01 a.m., Central Standard Time,
September 5, 1997. This Agreement shall become effective only upon the
satisfaction of the conditions precedent as set forth in Article 9 hereof.
3. Section 1.13 is amended in its entirety to provide as follows:
"Reserves" means as of the date hereof the sum of One Million
Six Hundred Twenty-Five Thousand ($1,625,000), less Claims amounts paid between
the Effective Date and the date of the relevant transfer of Reserves from the
Trust to Continental or from Continental to the Trust or Stoneville as required
or permitted by this Agreement, and subject to any other adjustments provided
for in this Agreement. The Reserves shall consist of funds allocated
specifically to Reported Claims as well as funds allocated to Unreported Claims.
4. Section 3.1 is amended in its entirety to provide as follows:
Certificate. Within thirty (30) days after satisfaction of the
conditions precedent as set forth in Article 9 hereof, the Trust shall issue and
send by first-class mail an Assumption Certificate in the form as set forth on
Exhibit D to each of the Trust's insureds as shown on the books and records of
the Trust.
5. Section 4.1 of the Agreement is deleted in its entirety.
6. The parties agree that Stoneville shall not provide to Continental
the Additional Collateral and all references to such Additional Collateral are
hereby deleted from the Agreement including but not limited to Sections 4.2,
7.3, 8.3, and 9.1 as if such references had not been included in the Agreement.
7. Article 7 is amended in its entirety to provide as follows:
7.1. Reinsurance. Stoneville shall have the right to
cause Continental to cede to Stoneville all of the Covered Obligations for the
purpose of providing reinsurance to Continental pursuant to Stoneville
Reinsurance. No consideration shall be paid or due to or from either
Stoneville or Continental for Stoneville Reinsurance.
7.2. Notice of Reinsurance. Stoneville may exercise Stoneville
Reinsurance on March 1, 1998, by providing written notice to Continental on or
prior to such exercise date. If Stoneville exercises Stoneville Reinsurance,
Continental and Stoneville shall enter into a Reinsurance Agreement in a form
acceptable to Continental with such acceptability criteria to be based on
customary industry practice and with such acceptance by Continental not to be
unreasonably withheld.
7.3. Effect of Stoneville Reinsurance on Reserves.
(a) Upon Stoneville Reinsurance Continental shall transfer to
Stoneville the amounts of Reserves entered in the Experience Account.
(b) Upon Stoneville Reinsurance, Stoneville agrees to fund a
trust account with a financial institution acceptable to Continental and
Stoneville with the amount of funds necessary for Continental to receive full
financial statement credit for such reinsurance and with the terms and
conditions of such trust to comply with the law of Continental's state of
domicile such that Continental shall receive full financial statement credit for
such reinsurance.
8. Article 8 is deleted in its entirety.
9. Unless specifically amended herein, all other terms and conditions
of the Agreement remain in full force and in effect. Unless otherwise
specifically stated herein, capitalized terms shall have the meanings assigned
to them in the Agreement.
The parties have duly executed this Amendment as of the day and year
first above written.
CONTINENTAL: TRUST:
CONTINENTAL CASUALTY COMPANY DELTA AGRICULTURAL AND
INDUSTRIAL TRUST
By: By:
Name/Title: Name/Title:
STONEVILLE:
STONEVILLE INSURANCE
COMPANY
By:
Name/Title:
