Exhibit 2.13
RENSURANCE TERMINATION AGREEMENT
REINSURANCE TERMINATION AGREEMENT ("Termination Agreement") entered into
between ANNUITY AND LIFE REASSURANCE LTD. (hereinafter referred to as "ALRe")
and VIVA REASSURANCE LTD. (hereinafter referred to as "Viva") made this 3lst
day of December, 2002. All defined terms used herein that are not otherwise
defined herein shall have the meaning assigned to such terms in the Agreement as
defined below.
WHEREAS Viva entered into a Reinsurance Agreement with ALRe dated as of
August 13, 2001, as amended as of October 11, 2001 and December 4, 2002, (the
"Agreement") whereby Viva, in consideration of payment of premium, agreed to
reinsure certain liabilities of ALRe;
WHEREAS pursuant to Section 3.03 of the Agreement, ALRe is exercising its
right to Recapture all of the Business such that the Agreement will be
terminated pursuant to Section 3.01(c) of the Agreement, and
WHEREAS Viva has agreed to waive its right to receive 30 days' prior
written notice in connection with the Recapture;
WHEREAS in connection with the Recapture, Viva and ALRe desire to
terminate this Agreement on December 31, 2002 and fully and finally to settle
and commute all of their present and future obligations, claims, debts and
liabilities known and unknown arising under or in respect of the Agreement; and
WHEREAS, pursuant to Section 2.11 of the Agreement, the parties agree that
all funds released from the Reserve Trusts, except for the Reserve Trust
established for Metropolitan Life Companies which shall be recaptured, shall be
distributed in accordance with the terms of the Custody and Control Agreement
(as defined in that certain Master Agreement among ALRe, Viva and XL Life LTD.
dated as of December 31, 2002, the "Master Agreement").
NOW THEREFORE, in consideration of the mutual covenants herein contained
and for other good and valuable consideration, the receipt of which is hereby
acknowledged, the parties hereby agree as follows:
1. Recapture and Termination. ALRe is hereby exercising its right to
Recapture pursuant to Section 3.03 of the Agreement and the Agreement is
terminated pursuant to Section 3.01(c) thereof.
2. Termination Accounting and Settlement.
(a) Waiver of Section 5.01 Termination Accounting and Settlement. Viva
and ALRe agree to waive the termination accounting and settlement
provision in Section 5.01 of the Agreement.
(b) Viva Deposit and Expenses. With respect to Viva, the parties agree
as follows:
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(i) The Viva deposits in the amount of $147,178,371.76 will be
wired to the Bank of America in full satisfaction of the
Credit Facility pursuant to the Master Agreement.
(ii) Viva will transfer a deposit of approximately $1,200,000 into
the Bank of Bermuda account of Viva (Account #812025) (the
"Deposit").
(iii) Viva may use the Deposit as repayment for Qualifying Expenses
as such term is defined in the Agreement that it has incurred
and has paid or is going to pay and which have not been
reimbursed by ALRe under the Agreement up to December 31,
2002, and to pay any "Additional Qualifying Expenses" as
defined further below going forward.
(iv) After December 31, 2002, Additional Qualifying Expenses will
include all Qualifying Expenses as such term is defined in the
Agreement as if the Agreement remained in place until January
31, 2003, plus expenses and costs incurred in connection with
this Termination Agreement and the Master Agreement, and any
additional expenses incurred by Viva directly relating to the
winding up of Viva and return of capital to Viva shareholders.
(v) There will be a reconciliation on February 15, 2003 (the
"Reconciliation Date"). Any funds remaining from the Deposit
at that date that are in excess of any Qualifying Expenses or
Additional Quali-
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fying Expenses incurred but not yet paid shall be repaid to
ALRe on the Reconciliation Date. If the Deposit has been
insufficient to meet all Qualifying Expenses or Additional
Qualifying Expenses paid or incurred by the Reconciliation
Date, ALRe will make a payment to Viva on the Reconciliation
Date equal to the Qualifying Expenses or Additional Qualifying
Expenses incurred or paid by Viva to that date in excess of
the Deposit.
(vi) If any further Qualifying Expenses or Additional Qualifying
Expenses (which will include for this purpose amounts in
excess of estimates or incurred costs used in (v) above) are
paid by Viva after February 15, 2003, ALRe agrees to reimburse
Viva for such payments.
(c) ALRe Deposit. The parties agree that Viva shall return the ALRe
deposit in the amount of $41,250,000 and that such amount will be
delivered by wire transfer to an account pursuant to the terms of
the Master Agreement.
3. Final Settlement. ALRe and Viva agree that the termination accounting and
settlement procedure set forth in paragraph 2 shall constitute a final
settlement of any and all of ALRe's and Viva's liability and the Agreement
shall be terminated, and neither Viva nor ALRe shall have any rights or
obligations thereunder, except to the extent provided in this Termination
Agreement.
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4. Release by ALRe. If and when the payments referred to in paragraph 1
herein shall have been fully and duly made by the parties hereto, then the
parties shall release and forever discharge each other, each others
agents, successors and assigns, and each others directors, officers and
employees from any and all liabilities and obligations arising under or
related to the Agreement, whether such liabilities are known or unknown
reported or unreported, and whether currently existing or arising in the
future, including but not limited to, all claims, debts, demands, causes
of action, duties, sums of money, covenants, contracts, controversies,
agreements, promises, doings, omissions, damages, judgments, costs,
expenses and losses whatsoever arising under or related to the Agreement,
provided, however, that this release does not discharge obligations which
have been undertaken by the terms of this Termination Agreement.
5. Waiver by Viva. In connection with ALRe's exercise of its Recapture right,
Viva hereby waives its right to receive 30 days written notice as provided
for in Section 3.03 of the Agreement and acknowledges that exercise of the
Recapture is effective against it.
6. Successors and Assigns. The rights, duties and obligations set forth
herein shall inure to the benefit of and be binding upon any and all
predecessors, successors, liquidators, receivers and assigns of the
parties hereto.
7. Entire Agreement. This Termination Agreement shall constitute the entire
agreement between the parties as it relates to the subject matter herein.
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8. Amendments. This Termination Agreement may not be modified or amended,
except by an instrument in writing, signed by the parties hereto.
9. Representations and Warranties. Viva and ALRe each expressly represent and
warrant that: (a) it is a corporation duly organized and in good standing
in its jurisdiction of incorporation; (b) this Termination Agreement has
been duly authorized, executed and delivered by and on behalf of it and
constitutes its legal, valid and binding agreement; (c) no authorization,
consent or approval of any governmental entity is required in connection
with the execution, delivery or performance by it of this Termination
Agreement; and (d) the execution, delivery or performance by it of this
Termination Agreement does not and will not conflict with, or result in
any material breach or violation of, its organizational documents or any
agreements to which it is a party or by which it or any of its assets are
bound.
10. Confidentiality. The parties agree to maintain the confidentiality of this
Termination Agreement and its terms, but when necessary or required either
party may disclose same to the party's auditors, reinsurers, governing
regulatory bodies, or third parties in court proceedings and arbitrations
in connection with mandatory discovery requirements or in connection with
an required insurance regulatory or state or federal securities law
filings. Either party may also disclose this Termination Agreement and its
terms under other circumstances if it obtains the prior written consent of
the other party for such disclosure, which consent shall not be
unreasonably withheld. Either
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party disclosing this Termination Agreement in a manner permitted by this
paragraph will take all reasonable precautions to protect its
confidentiality.
11. Governing Law. This Termination Agreement shall be interpreted under and
governed by the substantive laws of Bermuda.
12. Execution of Instruments. Viva and ALRe hereby agree to execute promptly
any and all supplemental agreements, releases, affidavits, waivers and
other documents of any nature or kind which the other party may reasonably
require in order to implement the provisions or objectives of this
Termination Agreement.
13. Execution in Counterparts. This Termination Agreement may be executed in
multiple counterparts, each of which, when so executed and delivered shall
be an original, but such counterparts shall together constitute one and
the same instrument and agreement.
14. Interpretation. The description heading herein are inserted for
convenience of reference only and are not intended to be a part of or to
affect the meaning or interpretation of this Termination Agreement.
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IN WITNESS WHEREOF the parties hereto have executed this TERMINATION
AGREEMENT in duplicate, as of the day and year first written above.
ANNUITY AND LIFE REASSURANCE LTD.
BY: /s/ R Xxxxx WITNESS: /s/ [Signature Illegible]
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TITLE: SVP & CU
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VIVA REASSURANCE LTD.
BY: /s/ M. D. Xxxxx WITNESS: /s/ [Signature Illegible]
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TITLE: Director
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