19
EXHIBIT 10.61
Agreement No. 8375
INTERESTS AND LIABILITIES AGREEMENT
NO. 8375
to
AGGREGATE CATASTROPHE EXCESS OF LOSS REINSURANCE AGREEMENT
between
AMCO INSURANCE COMPANY
ALLIED PROPERTY AND CASUALTY INSURANCE COMPANY
DEPOSITORS INSURANCE COMPANY
MOTOR CLUB OF IOWA INSURANCE COMPANY
000 Xxxxx Xxxxxx
Xxx Xxxxxx, Xxxx 00000-0000
(herein collectively referred to as the "Company")
and
GENERAL REINSURANCE CORPORATION
a Delaware corporation
having its principal offices at
Financial Centre
000 Xxxx Xxxx Xxxxxx P.O. Box 10350
Stamford, Connecticut 06904-2350
(herein referred to as the "Subscribing Reinsurer")
The Subscribing Reinsurer agrees to assume 10% of the liability under
the Aggregate Catastrophe Excess of Loss Reinsurance Agreement effective January
1, 1997, attached hereto.
As consideration the Subscribing Reinsurer shall receive identical
shares of the premiums named therein.
The share of the Subscribing Reinsurer shall be separate and apart from
the shares of the other Reinsurers, and the Subscribing Reinsurer shall in no
event participate in the Interests and Liabilities of the other Reinsurers.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
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executed in duplicate,
this 15th day of May , 1997 ,
AMCO INSURANCE COMPANY
ALLIED PROPERTY AND CASUALTY
INSURANCE COMPANY
DEPOSITORS INSURANCE COMPANY
MOTOR CLUB OF IOWA INSURANCE
COMPANY
/s/ Xxxxxxx X. Xxxxxxxx
---------------------------------
Xxxxxxx X. Xxxxxxxx
President
Attest: /s/ Xxxxxxx Xxxxxxxxx
----------------------------
Xxxxxxx Xxxxxxxxx
Xx. Vice President
and this 13th day of May , 1997 .
GENERAL REINSURANCE CORPORATION
/s/ Xxx Xxxxxx
---------------------------------
Xxx Xxxxxx
Vice President
Attest: /s/ Xxxxxx X. Reindall
----------------------------
Xxxxxx X. Reindall
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INTERESTS AND LIABILITIES AGREEMENT
to
AGGREGATE CATASTROPHE EXCESS OF LOSS REINSURANCE AGREEMENT
between
AMCO INSURANCE COMPANY
ALLIED PROPERTY AND CASUALTY INSURANCE COMPANY
DEPOSITORS INSURANCE COMPANY
MOTOR CLUB OF IOWA INSURANCE COMPANY
000 Xxxxx Xxxxxx
Xxx Xxxxxx, Xxxx 00000-0000
(herein collectively referred to as the "Company")
and
ALLIED MUTUAL INSURANCE COMPANY
000 Xxxxx Xxxxxx
Xxx Xxxxxx, Xxxx 00000-0000
(herein referred to as the "Subscribing Reinsurer")
The Subscribing Reinsurer agrees to assume 90% of the liability under
the Aggregate Catastrophe Excess of Loss Reinsurance Agreement effective January
1, 1997, attached hereto.
As consideration the Subscribing Reinsurer shall receive identical
shares of the premiums named therein.
The share of the Subscribing Reinsurer shall be separate and apart from
the shares of the other Reinsurers, and the Subscribing Reinsurer shall in no
event participate in the Interests and Liabilities of the other Reinsurers.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
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executed in duplicate,
this 15th day of May , 1997 ,
AMCO INSURANCE COMPANY
ALLIED PROPERTY AND CASUALTY
INSURANCE COMPANY
DEPOSITORS INSURANCE COMPANY
MOTOR CLUB OF IOWA INSURANCE
COMPANY
Attest: /s/ Xxxxxxx X. Xxxxxxxxx /s/ Xxxxxxx X. Xxxxxxxx
------------------------------ ----------------------------------
Xxxxxxx X. Xxxxxxxxx Xxxxxxx X. Xxxxxxxx
Xx. Vice President President
and this 15th day of May , 1997 .
ALLIED MUTUAL INSURANCE COMPANY
/s/ Xxxxx X. Xxxxxxx
----------------------------------
Xxxxx X. Xxxxxxx
Treasurer
Attest: /s/ X. X. Xxxxxx
------------------------------
X. X. Xxxxxx
Secretary
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AGGREGATE CATASTROPHE
EXCESS OF LOSS REINSURANCE AGREEMENT
between
AMCO INSURANCE COMPANY
ALLIED PROPERTY AND CASUALTY INSURANCE COMPANY
DEPOSITORS INSURANCE COMPANY
MOTOR CLUB OF IOWA INSURANCE COMPANY
000 Xxxxx Xxxxxx
Xxx Xxxxxx, Xxxx 00000-0000
(herein collectively referred to as the "Company")
and
The Subscribing Reinsurers executing
the Interests and Liabilities Agreements attached to this Agreement
(herein collectively referred to as the "Reinsurers")
---------------------------------------------------------------------------
PREAMBLE
In consideration of the mutual covenants herein contained and upon the
terms and conditions herein set forth, the Reinsurers shall indemnify the
Company as herein provided and specified.
Article I - BUSINESS REINSURED
The Reinsurers hereby agree to reinsure, subject to the terms and
conditions contained herein, the net excess liability of the Company resulting
from loss occurrences commencing during the term of this Agreement under
policies, contracts or binders of insurance or reinsurance, whether oral or
written, (hereinafter called "policies") heretofore issued or which hereafter
may be issued or renewed by the Company and classified by the Company as
Property including Inland Marine, Earthquake and Automobile Physical Damage, but
only as respects the perils of windstorm, hail, tornado, hurricane, cyclone,
including ensuing collapse and water damage, and earthquake.
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Article II - TERM
The term of this Agreement shall be from 12:01 a.m., Central Standard
Time, January 1, 1997 to 12:01 a.m., Central Standard Time, January 1, 1998 and
shall apply to all loss occurrences commencing during the term of this
Agreement.
If this Agreement shall terminate while a loss occurrence covered
hereby is in progress, it is agreed that, subject to the other conditions of
this Agreement, the Reinsurers shall be liable for their proportion of the
entire loss or damage.
Article III - TERRITORY
This Agreement shall apply to losses occurring within the territorial
limits of the Company's original policies.
Article IV - EXCLUSIONS
This Agreement shall not apply to:
(a) Pro rata and excess of loss reinsurance assumed, except
reinsurance assumed between member companies of the ALLIED
Group, agency reinsurance and business reinsured 100% by the
Company.
(b) All Casualty business except mandatory coverages under the
Property portion of package policies.
(c) Ocean Marine.
(d) Fidelity and Surety.
(e) Financial Guarantee and Insolvency.
(f) Boiler and Machinery.
(g) Hail on growing and standing crops.
(h) Mortgage impairment insurance and similar kinds of insurance
however styled.
(i) Difference in Conditions insurance when written as such.
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(j) Any peril not specifically included in the article entitled
BUSINESS REINSURED. Fire following directly occasioned by the
earthquake is excluded.
(k) Loss or liability in respect of overhead transmission and
distribution lines and their supporting structures other than
those on or within 1000 feet of the insured premises. It is
understood and agreed that public utilities extension and/or
suppliers extension and/or contingent business interruption
coverages are not subject to this exclusion, provided that these
are not part of a transmitters' or distributors' policy.
(l) Loss or Damage or Costs or Expenses arising from Seepage and/or
Pollution and/or Contamination, other than contamination from
smoke damage. Nevertheless, this exclusion does not preclude any
payment of the cost of the removal of debris of property damaged
by a loss otherwise covered hereunder, but subject always to a
limit of not more than 25% of the Company's property loss under
the original policy.
(m) Loss or liability as excluded by the attached Insolvency Funds
Exclusion Clause.
(n) Loss or liability as excluded by the attached Pools and
Associations Exclusion Clause.
(o) Loss or liability as excluded by the attached North American War
Exclusion Clause (Reinsurance).
(p) Loss or liability as excluded by the attached Nuclear Incident
Exclusion Clauses - Physical Damage Reinsurance.
Article V - LIMIT AND RETENTION
No claim shall be made upon the Reinsurers hereunder unless and until
the Company shall have first sustained:
(a) With respect to aggregate excess losses resulting from loss
occurrences commencing during any calendar quarter during the
term of this Agreement an ultimate net loss in excess of the
Company's percentage share of the Reinsurance Pool multiplied by
$20,000,000; or
(b) With respect to aggregate excess losses resulting from loss
occurrences commencing during the entire term of this Agreement
an ultimate net loss in excess of the Company's percentage share
of the Reinsurance Pool multiplied by $50,000,000,
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and then the Reinsurers shall be liable for the amount of the ultimate net loss
sustained by the Company in excess thereof but the sum recoverable with respect
to aggregate excess losses resulting from loss occurrences commencing during the
entire term of this Agreement shall not exceed the Company's percentage share of
the Reinsurance Pool multiplied by $30,000,000.
For purposes of this Article, the term "excess loss" shall mean
ultimate net loss sustained by the Company in each loss occurrence for which the
ultimate net loss sustained by the Company exceeds a franchise deductible of the
Company's percentage share of the Reinsurance Pool multiplied by $250,000.
Article VI - NET RETAINED LIABILITY
This Agreement applies only to that portion of any insurance or
reinsurance covered by this Agreement which the Company retains net for its own
account, and in calculating the amount of any loss hereunder and also in
computing the amount in excess of which this Agreement attaches, only loss or
losses in respect of that portion of any insurances or reinsurances which the
Company retains net for its own account shall be included.
It is understood and agreed that the amount of the Reinsurers'
liability hereunder in respect of any loss or losses shall not be increased by
reason of the inability of the Company to collect from any other reinsurer,
whether specific or general, any amount which may have become due from them,
whether such inability arises from the insolvency of such other reinsurer or
otherwise.
Article VII - ULTIMATE NET LOSS
The term "ultimate net loss" shall mean such amounts that the Company
is liable to pay in the settlement of claims or satisfaction of judgments,
including court costs, interest on judgments, and allocated investigation,
adjustment, and legal expenses of the Company. It is understood that allocated
expenses applicable to salaried adjusters of the Company shall be an amount
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equal to 10% of the amount paid by the Company in settlement of claims or
satisfaction of judgments. Nothing in this clause, however, shall be construed
to mean that losses under this Agreement are not recoverable until the Company's
ultimate net loss has been ascertained.
All salvages, recoveries or payments and reversals or reductions of
verdicts or judgments recovered or received subsequent to a loss settlement
under this Agreement, including amounts recoverable under inuring reinsurance
whether collected or not, shall be applied as if recovered or received prior to
loss settlement, and shall be deducted from the actual loss sustained to arrive
at the amount of ultimate net loss hereunder.
Article VIII - DEFINITION OF LOSS OCCURRENCE
The term "loss occurrence" shall mean the sum of all individual losses
directly occasioned by any one disaster, accident or loss or series of
disasters, accidents or losses arising out of one event which occurs within the
area of one state of the United States or province of Canada and states or
provinces contiguous thereto and to one another. However, the duration and
extent of any one "loss occurrence" shall be limited to all individual losses
sustained by the Company occurring during any period of 72 consecutive hours
arising out of and directly occasioned by the same event except that the term
"loss occurrence" shall be further defined as follows:
(a) As regards windstorm, hail, tornado, hurricane, cyclone,
including ensuing collapse and water damage, the event need not
be limited to one state or province or states or provinces
contiguous thereto.
(c) As regards earthquake, the epicentre of which need not
necessarily to be within the territorial confines referred to in
the opening paragraph of this Article.
For all "loss occurrences", the Company may choose the date and time
when any such period of consecutive hours commences, provided that it is not
earlier than the date and time of the occurrence of the first recorded
individual loss sustained by the Company arising out of that disaster, accident
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or loss and provided that only one such period of 72 consecutive hours shall
apply with respect to one event.
Article IX - DEFINITION OF REINSURANCE POOL
The term "Reinsurance Pool" shall mean the pooling arrangement among
the companies listed in this Agreement as the reinsured Company and Allied
Mutual Insurance Company.
Article X - PREMIUM AND REPORTS
For the term of this Agreement, January 1, 1997 to January 1, 1998, the
Company shall pay to the Reinsurers an annual premium equal to the Company's
percentage share of the Reinsurance Pool multiplied by $5,000,000 payable in
quarterly installments on January 1, April 1, July 1 and October 1, 1997.
The Company shall also provide the Reinsurers as soon as possible after
December 31 any reports which may be necessary for annual statement purposes.
Article XI - NOTICE OF LOSS AND LOSS SETTLEMENT
As soon as practicable after the close of each calendar quarter, the
Company will advise the Reinsurers of all loss occurrences which commenced
during the quarter which in the opinion of the Company may involve the
Reinsurers under this Agreement and of all subsequent developments pertaining
thereto which in the opinion of the Company may materially affect the position
of the Reinsurers.
All loss settlements made by the Company provided same are within the
terms of this Agreement, shall be unconditionally binding upon the Reinsurers.
The Reinsurers agree to pay all amounts for which they may be liable immediately
upon receiving reasonable evidence from the Company of the amount due, or to be
due.
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Article XII - CURRENCY
All payments made under this Agreement shall be made in United States
currency.
Article XIII - ACCESS TO RECORDS
The Reinsurers or their duly accredited representative shall have free
access to the books and records of the Company at all reasonable times for the
purpose of obtaining information concerning this Agreement or the subject matter
thereof.
Article XIV - ERRORS AND OMISSIONS
Any delays, omissions or errors inadvertently made in conjunction with
this Agreement shall not be held to relieve either party hereto from any
liability which would attach to it hereunder if such delay, omission, or error
had not been made, provided such error or omission is rectified as soon as
possible after discovery.
Article XV - INSOLVENCY
In the event of the insolvency of the Company, the reinsurance proceeds
will be paid to the Company or the liquidator on the basis of the amount of the
claim allowed in the insolvency proceeding without diminution by reason of the
inability of the Company to pay all or part of the claim.
The Reinsurers shall be given written notice of the pendency of each
claim against the Company on the policy(ies) reinsured hereunder within a
reasonable time after such claim is filed in the insolvency proceedings. The
Reinsurers shall have the right to investigate each such claim and to interpose,
at their own expense, in the proceeding where such claim is to be adjudicated,
any defenses which they may deem available to the Company or its liquidator. The
expense thus incurred by the Reinsurers shall be chargeable, subject to court
approval, against the insolvent Company as part of the expense of liquidation to
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the extent of a proportionate share of the benefit which may accrue to the
Company solely as a result of the defense undertaken by the Reinsurers.
Article XVI - ARBITRATION
Any unresolved difference of opinion between the Reinsurers and the
Company shall be submitted to arbitration by three arbitrators. If more than one
Reinsurer is involved in the same dispute, all such Reinsurers shall constitute
and act as one party for purposes of this Article and communications shall be
made by the Company to each of the Reinsurers constituting the one party;
provided, however, that nothing herein shall impair the rights of such
Reinsurers to assert several, rather than joint, defenses of claims, nor be
construed as changing the liability of the Reinsurers under the terms of this
Agreement from several to joint.
One arbitrator shall be chosen by the Reinsurer(s), and one shall be
chosen by the Company. The third arbitrator shall be chosen by the other two
arbitrators within ten (10) days after they have been appointed. If the two
arbitrators cannot agree upon a third arbitrator, each arbitrator shall nominate
three persons of whom the other shall reject two. The third arbitrator shall
then be chosen by drawing lots. If either party fails to choose an arbitrator
within thirty (30) days after receiving the written request of the other party
to do so, the latter shall choose both arbitrators, who shall choose the third
arbitrator. The arbitrators shall be impartial and shall be active or retired
persons whose principal occupation is or was as an officer of property and
casualty insurance or reinsurance companies.
The party requesting arbitration (the "Petitioner") shall submit its
brief to the arbitrators within thirty (30) days after notice of the selection
of the third arbitrator. Upon receipt of the Petitioner's brief, the other party
(the "Respondent") shall have thirty (30) days to file a reply brief. On receipt
of the Respondent's brief, the Petitioner shall have twenty (20) days to file a
rebuttal brief. Respondent shall have twenty (20) days from the receipt of
Petitioner's rebuttal brief to file its rebuttal brief. The arbitrators may
extend the time for filing of briefs at the request of either party.
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The arbitrators are relieved from judicial formalities and, in addition
to considering the rules of law and the customs and practices of the insurance
and reinsurance business, shall make their award with a view to effecting the
intent of this Agreement. The decision of the majority shall be final and
binding upon the parties. The costs of arbitration, including the fees of the
arbitrators, shall be shared equally unless the arbitrators decide otherwise.
The arbitration shall be held at the times and places agreed upon by the
arbitrators.
Article XVII - TAX CLAUSE
In consideration of the terms under which this Agreement is issued, the
Company undertakes not to claim any deduction of the premium hereon when making
Canadian tax returns or when making tax returns other than Income or Profits Tax
returns, to any State or Territory of the United States of America or to the
District of Columbia.
Article XIII - OFFSET
The Company or the Reinsurers may offset any balance, whether on
account of premium, commission, claims or losses, adjustment expense, salvage,
or otherwise, due from one party to the other under this Agreement or under any
other agreement heretofore or hereafter entered into between the Company and the
Reinsurers.
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INSOLVENCY FUNDS EXCLUSION CLAUSE
It is agreed that this Agreement excludes all liability of the Company
arising, by contract, operation of law, or otherwise, from its participation or
membership, whether voluntary or involuntary, in any insolvency fund.
"Insolvency fund" includes any guaranty fund, insolvency fund, plan, pool,
association, fund, or other arrangement, howsoever denominated, established, or
governed, which provides for any assessment of or payment or assumption by the
Company of part or all of any claim, debt, charge, fee, or other obligation of
an insurer, or its successors or assigns, which has been declared by any
competent authority to be insolvent, or which is otherwise deemed unable to meet
any claim, debt, charge, fee, or other obligation in whole or in part.
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POOLS AND ASSOCIATIONS EXCLUSION CLAUSE
SECTION A
Excluding:
(a) All business derived directly or indirectly from any Pool, Association,
or Syndicate which maintains its own reinsurance facilities.
(b) Any Pool or Scheme (whether voluntary or mandatory) formed after March 1,
1968, for the purpose of insuring property whether on a country-wide
basis or in respect of designated areas. This exclusion shall not apply
to so-called Automobile Insurance Plans or other pools formed to provide
coverage for Automobile Physical damage.
SECTION B
It is agreed that business written by the Company for the same perils, which is
known at the time to be insured by, or in excess of underlying amounts placed in
the following Pools, Associations, or Syndicates, whether by way of insurance or
reinsurance, is excluded hereunder:
Industrial Risk Insurers (formerly Factory Insurance Association and Oil
Insurance Association), including Underwriters Grain Division.
Associated Factory Mutuals.
Improved Risk Mutuals.
Any Pool, Association, or Syndicate formed for the purpose of writing
Oil, Gas or Petro-Chemical Plants and/or Oil or Gas Drilling Rigs.
Nuclear Energy Property Insurance Association.
Nuclear Energy Liability Insurance Association.
Mutual Atomic Energy Reinsurance Pool.
Mutual Atomic Energy Liability Underwriters.
United States Aircraft Insurance Group.
Canadian Aircraft Insurance Group.
Associated Aviation Underwriters.
American Aviation Underwriters.
Section B does not apply:
(a) Where the Total Insured value over all interests of the risk in question
is less than $250,000,000.
(b) To interests traditionally underwritten as Inland Marine or Stock and/or
Contents written on a Blanket basis.
(c) To Contingent Business Interruption, except when the Company is aware
that the key location is known at the time to be insured in any Pool,
Association, or Syndicate named above, other than as provided for under
Section B (a).
(d) To risks as follows: Offices, Hotels, Apartments, Hospitals, Educational
Establishments, Public Utilities (other than Railroad Schedules) and
Builders Risks on the classes of risks specified in this subsection (d)
only.
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Where the Clause attaches to Catastrophe Excesses, the following SECTION C is
added:
SECTION C
NEVERTHELESS the Reinsurers specifically agree that liability accruing to the
Company from its participation in residual market mechanisms including but not
limited to:
(1) The following so-called "Coastal Pools":
ALABAMA INSURANCE UNDERWRITING ASSOCIATION
FLORIDA WINDSTORM UNDERWRITING ASSOCIATION
LOUISIANA INSURANCE UNDERWRITING ASSOCIATION
MISSISSIPPI WINDSTORM UNDERWRITING ASSOCIATION
NORTH CAROLINA INSURANCE UNDERWRITING ASSOCIATION
SOUTH CAROLINA WINDSTORM AND HAIL UNDERWRITING ASSOCIATION
TEXAS CATASTROPHE PROPERTY INSURANCE ASSOCIATION
and
(2) All "Fair Plan" and "Rural Risk Plan" Business,
for all perils otherwise protected hereunder shall not be excluded, except that
this reinsurance does not include any increase in such liability resulting from:
(i) The inability of any other participant in such Residual Market Mechanisms
including but not limited to "Coastal Pool" and/or "Fair Plan" and/or
"Rural Risk Plan" to meet its liability.
(ii) Any claim against such "Coastal Pool" and/or "Fair Plan" and/or "Rural
Risk Plan" and/or Residual Market Mechanisms, or any participant therein,
including the Company, whether by way of subrogation or otherwise,
brought by or on behalf of any insolvency fund (as defined in the
Insolvency Funs Exclusion Clause incorporated in this Agreement).
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NORTH AMERICAN WAR EXCLUSION CLAUSE (REINSURANCE)
As regards interest which at time of loss or damage are on shore, no liability
shall attach hereto in respect of any loss or damage which is occasioned by war,
invasion, hostilities, acts of foreign enemies, civil war, rebellion,
insurrection, military or usurped power, or martial law or confiscation by order
of any government or public authority.
This War Exclusion Clause shall not, however, apply to interests which at time
of loss or damage are within the territorial limits of the United States of
America (comprising the fifty States of the Union and the District of Columbia
and including Bridges between the U.S.A. and Mexico provided they are under
United States ownership), Canada, St. Pierre and Miquelon, provided such such
interests are insured under policies endorsements or binders containing a
standard war or hostilities or warlike operations exclusion clause.
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NUCLEAR INCIDENT EXCLUSION CLAUSE - PHYSICAL DAMAGE - REINSURANCE - USA
(1) This Agreement does not cover any loss or liability accruing to the
Company directly or indirectly and whether as Insurer or Reinsurer, from any
Pool of Insurers or Reinsurers formed for the purpose of covering Atomic or
Nuclear Energy risks.
(2) Without in any way restricting the operation of paragraph (1) of
this Clause, this Agreement does not cover any loss or liability accruing to the
Company, directly or indirectly and whether as Insurer or Reinsurer, from any
insurance against Physical Damage (including business interruption or
consequential loss arising out of such Physical Damage) to:
(i) Nuclear reactor power plants including all auxiliary property on
the site, or
(ii) Any other nuclear reactor installation, including laboratories
handling radioactive materials in connection with reactor
installations, and "critical facilities" as such, or
(iii) Installations for fabricating complete fuel elements or for
processing substantial quantities of "special nuclear material",
and for reprocessing, salvaging, chemically separating, storing
or disposing of "spent" nuclear fuel or waste materials, or
(iv) Installations other than those listed in paragraph (2) (iii)
above using substantial quantities of radioactive isotopes or
other products of nuclear fission.
(3) Without in any way restricting the operations of paragraphs, (1)
and (2) hereof, this Agreement does not cover any loss or liability by
radioactive contamination accruing to the Company, directly or indirectly, and
whether as Insurer or Reinsurer, from any insurance on property which is on the
same site as a nuclear reactor power plant or other nuclear installation and
which normally would be insured therewith except that this paragraph (3) shall
not operate:
(a) where the Company does not have knowledge of such nuclear reactor
power plant or nuclear installation, or
(b) where said insurance contains a provision excluding coverage for
damage to property caused by or resulting from radioactive
contamination, however caused. However on and after 1st January
1960 this sub-paragraph (b) shall only apply provided the said
radioactive contamination exclusion provision has been approved
by the Governmental Authority having jurisdiction thereof.
(4) Without in any way restricting the operations of paragraphs (1),(2)
and (3) hereof, this Agreement does not cover any loss or liability by
radioactive contamination accruing to the Company, directly or indirectly, and
whether as Insurer or Reinsurer, when such radioactive contamination is a named
hazard specifically insured against.
(5) It is understood and agreed that this Clause shall not extend to
risks using radioactive isotopes in any form where the nuclear exposure is not
considered by the Company to be the primary hazard.
(6) The term "special nuclear material" shall have the meaning given it
in the Atomic Energy Act of 1954 or by any law amendatory thereof.
(7) The Company to be sole judge of what constitutes:
(a) substantial quantities, and
(b) the extent of installation, plant or site.
Note: Without in any way restricting the operation of paragraph (1) hereof, it
is understood and agreed that:
(a) all policies issued by the Company on or before 31st December
1957 shall be free from the application of the other provisions
of this Clause until expiry date or 31st December 1960 whichever
first occurs whereupon all the provisions of this Clause shall
apply.
(b) with respect to any risk located in Canada policies issued by the
Company on or before 31st December 1958 shall be free from the
application of the other provisions of this Clause until expiry
date or 31st December 1960 whichever first occurs whereupon all
the provisions of this Clause shall apply.
