THE REGISTRANT HAS APPLIED FOR CONFIDENTIAL TREATMENT OF CERTAIN TERMS IN THIS
EXHIBIT WITH THE SECURITIES AND EXCHANGE COMMISSION. THE CONFIDENTIAL PORTIONS
OF THIS EXHIBIT ARE MARKED WITH AN ASTERISK [*] AND HAVE BEEN OMITTED. THE
OMITTED PORTIONS OF THIS EXHIBIT WILL BE FILED SEPARATELY WITH THE SECURITIES
AND EXCHANGE COMMISSION PURSUANT TO A CONFIDENTIAL TREATMENT REQUEST.
REINSURANCE AGREEMENT
BETWEEN
NORTH AMERICAN SECURITY LIFE INSURANCE COMPANY
BOSTON, MASSACHUSETTS
referred to as the "Ceding Company"
AND
PAINEWEBBER LIFE INSURANCE COMPANY
WEEHAWKEN, NEW JERSEY
referred to as the "Reinsurer"
TABLE OF CONTENTS
Page
----
ARTICLE I GENERAL PROVISIONS 3
ARTICLE II REINSURANCE PREMIUMS 7
ARTICLE III COMMISSIONS AND ALLOWANCES 8
ARTICLE IV BENEFIT PAYMENTS 11
ARTICLE V RESERVE ADJUSTMENTS 13
ARTICLE VI ADJUSTMENT FOR TRANSFERS INVOLVING FIXED ACCOUNT 14
ARTICLE VII ACCOUNTING AND SETTLEMENTS 15
ARTICLE VIII DURATION AND RECAPTURE 18
ARTICLE IX TERMINAL ACCOUNTING AND SETTLEMENT 21
ARTICLE X ARBITRATION 22
ARTICLE XI INSOLVENCY 23
ARTICLE XII EXECUTION AND EFFECTIVE DATE 24
SCHEDULE A ANNUITIES AND RISKS REINSURED 25
SCHEDULE B QUARTERLY REPORT OF ACTIVITY AND SETTLEMENTS 28
SCHEDULE C MODIFIED COINSURANCE RESERVE INVESTMENT CREDIT 33
SCHEDULE D COMMISSION SCHEDULES 34
REINSURANCE AGREEMENT
This Agreement is made and entered into by and between North American Security
Life Insurance Company (hereinafter referred to as the "Ceding Company") and
Xxxxx Xxxxxx Life Insurance Company (hereinafter referred to as the
"Reinsurer").
The Ceding Company and the Reinsurer mutually agree to reinsure on the terms and
conditions stated herein. This Agreement is an indemnity reinsurance agreement
solely between the Ceding Company and the Reinsurer, and performance of the
obligations of each party under this Agreement will be rendered solely to the
other party. In no instance will anyone other than the Ceding Company or the
Reinsurer have any rights under this Agreement, and the Ceding Company will be
and remains the only party hereunder that is liable to any insured, policy owner
or beneficiary under any annuity reinsured hereunder.
ARTICLE I
GENERAL PROVISIONS
1. Annuities and Risks Reinsured. The Reinsurer agrees to indemnify the Ceding
Company for, and the Ceding Company agrees to reinsure with the Reinsurer,
according to the terms and conditions hereof, the portion of the risks
under the annuities described in Schedule A attached hereto.
2. Coverages and Exclusions. Only the variable annuities described in Schedule
A are reinsured under this Agreement.
3. Plan of Reinsurance. This indemnity reinsurance will be on a
modified-coinsurance basis. The Ceding Company will retain, control and own
all assets held in relation to the Modified Coinsurance Reserve.
4. Expenses. The Reinsurer will bear no part of the expenses incurred in
connection with the annuities reinsured hereunder, except as otherwise
provided herein.
5. Annuity Changes. The Ceding Company must provide written notification to
the Reinsurer of any change which affects the original terms or conditions
of any annuity reinsured hereunder not later than thirty (30) days after
the change takes effect. The Reinsurer will provide written notification
to the Ceding Company as to the Reinsurer's acceptance or rejection of the
change within thirty (30) days after receipt of notice of the change. If
the Reinsurer accepts any such change, the Reinsurer will (a) assume that
portion of any increase in the Ceding Company's liability, resulting from
the change, which corresponds to the portion of the annuities reinsured
hereunder, and (b) receive credit for that portion of any decrease in the
Ceding Company's liability, resulting from the change, which corresponds to
the portion of the annuities reinsured hereunder. If the Reinsurer rejects
any such change, the Reinsurer's liability under this Agreement will be
determined as if no such change had occurred.
6. No Extracontractual Damages. The Reinsurer does not indemnify the Ceding
Company for, and will not be liable for, any extracontractual damages or
extracontractual liability of any kind whatsoever resulting from fraud,
oppression, bad faith, strict liability, or negligent, reckless or
intentional wrongs on the part of the Ceding Company or its directors,
officers,
employees and agents. The following types of damages are examples of
damages that would be excluded under this Agreement for the conduct,
described above actual damages, damages for emotional distress, and
punitive or exemplary damages.
7. Annuity Administration. The Ceding Company will administer the annuities
reinsured hereunder and will perform all accounting for such annuities;
provided, however, that the Reinsurer reserves the right to participate in
claims administration.
8. Inspection. At any reasonable time, the Reinsurer or its representatives
may inspect during normal business hours, at the principal office of the
Ceding Company, the original papers and any and all other books or
documents relating to or affecting reinsurance under this Agreement. The
Reinsurer or its representatives will not use any information obtained
through any inspection pursuant to this Paragraph for any purpose not
relating to reinsurance hereunder.
9. Taxes. The allowance for any premium taxes paid in connection with the
annuities reinsured hereunder is included in the Commissions and
Allowances, described in Article III. The Reinsurer will not reimburse the
Ceding Company for any other taxes paid by the Ceding Company in connection
with the annuities reinsured hereunder.
10. Proxy Tax Reimbursement. Pursuant to IRC Section 848, insurance companies
are required to capitalize and amortize specified policy acquisition
expenses. The amount capitalized is determined by proxy based on a
percentage of "reinsurance premiums" as defined in the IRS regulations
relating to IRC Section 848. The Reinsurer and the Ceding Company agree
that any costs which would result from IRC Section 848 are not subject to
reimbursement hereunder.
11. Election to Determine Specified Policy Acquisition Expenses. The Ceding
Company and the Reinsurer agree that the party with net positive
consideration under this Agreement will capitalize specified policy
acquisition expenses with respect to annuities reinsured under this
Agreement without regard to the general deductions limitation of Section
848(c)(1) of the Internal Revenue Code of 1986, as amended. The coding
Company and the Reinsurer will Exchange information pertaining to the
amount of net consideration under this agreement each year to ensure
consistency. The Ceding Company will submit a schedule to the Reinsurer by
May 1 of each year presenting its calculation of the net consideration for
the preceding taxable year. The Reinsurer may contest the calculation in
writing within
thirty (30) days of receipt of the Ceding Company's schedule. Any
differences will be resolved between the parties so that consistent amounts
are reported on the respective tax returns for the preceding taxable year.
This election to capitalize specified policy acquisition expenses without
regard to the general deductions limitation is effective for all taxable
years during which this Agreement remains in effect.
12. Condition. The reinsurance hereunder is subject to the same limitations and
conditions as the annuities issued by the Ceding Company which are
reinsured hereunder, except as otherwise provided in this Agreement.
13. Misunderstandings and Oversights. If any failure to pay amounts due or to
perform any other act required by this Agreement is unintentional and
caused by misunderstanding or oversight, the Ceding Company and the
Reinsurer will adjust the situation to what it would have been had the
misunderstanding or oversight not occurred.
14. Adjustments. If the Ceding Company's liability under any of the annuities
reinsured hereunder is changed because of a misstatement of age, sex or any
other material fact, the Reinsurer will (a) assume that portion of any
increase in the Ceding Company's liability, resulting from the change,
which corresponds to the portion of the annuities reinsured hereunder, and
(b) receive credit for that portion of any decrease in the Ceding Company's
liability, resulting from the change, which corresponds to the portion of
the annuities reinsured hereunder.
15. Reinstatements. If an annuity reinsured hereunder is surrendered or
annuitized, and is subsequently reinstated while this Agreement is in
force, the reinsurance for such annuity will be reinstated automatically.
The Ceding Company will pay the Reinsurer the Reinsurer's proportionate
share of all amounts received by the Ceding Company in connection with the
reinstatement of the annuity, plus any amounts previously refunded to the
Ceding Company by the Reinsurer in connection with the lapse of the
annuity.
16. Assignment. The Ceding Company may not assign any of its rights, duties or
obligations under this Agreement without prior written consent of the
Reinsurer. The Reinsurer may not assign any of its rights, duties, or
obligations under this Agreement without prior written consent of the
Ceding Company.
17. Amendments and Waiver. Any change or modification to this Agreement will be
null and void unless made by amendment to the Agreement and signed by both
parties. Any waiver will constitute a waiver only in the circumstances for
which it was given and will not be a waiver of any future circumstances.
18. Entire Agreement. The terms expressed herein constitute the entire
agreement between the parties with respect to the annuities reinsured
hereunder. There are no understandings between the parties with respect to
the annuities reinsured hereunder other than as expressed in this
Agreement.
19. Current Practices. The Ceding Company will not materially change, alter or
otherwise compromise its underwriting, claims paying or administrative
practice with respect to the annuities reinsured hereunder without prior
written consent of the Reinsurer.
ARTICLE II
REINSURANCE PREMIUMS
1. Initial Consideration. The Ceding Company will pay the Reinsurer an Initial
Consideration equal to the quota share, as defined in Schedule A, of the
Account Value on all annuities reinsured under this Agreement, calculated
as of the Effective Date of this Agreement.
2. Reinsurance Premiums. The Ceding Company will pay the Reinsurer Reinsurance
Premiums on all annuities reinsured under this Agreement in an amount equal
to a quota share, as defined in Schedule A, of the gross premiums collected
and deposited into the Separate Account during the Accounting period by the
Ceding Company. The Reinsurance Premiums paid to the Reinsurer by the
Ceding Company will be remitted to the Reinsurer at the end of the
Accounting Period during which the gross premiums were collected and
deposited by the Ceding Company.
ARTICLE III
COMMISSIONS AND ALLOWANCES
1. Initial Commission. Simultaneous with the payment of the Initial
Consideration, the Reinsurer will pay an Initial Commission to the Ceding
Company equal to a percentage of the Initial Consideration, as follows:
Initial Commission as a
Category as Described Percentage of Initial
in Schedule A Consideration
--------------------- -----------------------
A & B [*]
C & D [*]
E [*]
F [*]
2. Premium Tax. The Reinsurer shall reimburse the Ceding Company for all
premium taxes incurred on the Reinsurance Premiums.
3. Commissions. The Reinsurer shall reimburse the Ceding Company for all
commissions wholesaler overrides and costs of special promotions incurred
on the Reinsurance Premiums and on that portion of the Account Value of
the annuities reinsured hereunder which corresponds to the portion of the
annuities reinsured hereunder as of the end of the current Accounting
Period. Commissions will be net of a quota share of commission chargebacks
on policies reinsured hereunder. Schedule D shows the current commission
schedule for the annuities reinsured hereunder.
4. Allowance for Expenses. The Reinsurer will pay the Ceding Company as
Allowances for Expenses for each Accounting Period equal to (i) plus
(ii) plus (iii) plus (iv) plus (v), where:
(i) For policy maintenance, equals (a) times (b), where:
(a) [*] times the quota share percentage of the Venture annuities
reinsured hereunder, as described in Schedule A: and
(b) equals the number of Venture annuities reinsured hereunder and
described in Schedule A, that are inforce at the end of the
current Accounting Period;
(ii) For policy issuance, equals (a) times (b), where;
(a) [*] times the quota share percentage of the Venture
annuities reinsured hereunder, as described in Schedule A;
and
(b) equals the number of Venture annuities reinsured hereunder
and described in Schedule A, that were issued during the
current Accounting Period;
(iii) For DAC proxy tax, equals (a) times (b), where
(a) [*] and
(b) equals that amount of the Reinsurance Premiums received on
non-qualified policies;
(iv) For other costs and risks, an allowance of (a) times (b), where:
(a) [*] and
(b) equals the quota share of the account values at the end of
the Accounting Period on the annuities reinusured hereunder.
(v) (a) minus (b), times (c), where:
(a) equals the quota share of the account value at the end of
the Accounting Period of the annuities reinsured hereunder.
(b) equals the Modified Coinsurance Reserve at the end of the
Accounting Period of the annuities reinsured hereunder.
(c) [*]
(vi) Amounts in (i)(a) and (ii)(a) above are for 1994. They will be
adjusted annually on January 1, for inflation at the change in
the Consumer Price Index (CPI-U as determined by Department of
Labor and published in the Wall Street Journal).
5. Minimum Death Benefit Guarantee Costs: The Reinsurer will pay the Ceding
Company an allowance for such Accounting Period for the costs of the
minimum death benefit guarantee. The allowance equals (a) times (b), where
(a) and (b) equal:
Category as
Described in
Schedule A (a) (b)
------------ ------ --------------------------------------------------------
A & C [*] Quota share of the account values at the end of the
Accounting Period on Category A & C annuities
B, D, E & F [*] Quota share of the account values at the end of the
Accounting Period on Category B, D, E & F annuities
ARTICLE IV
BENEFIT PAYMENTS
1. Benefit Payments. Benefit Payments, as referred to in this Agreement, means
the Reinsurer's quota share of (i) Claims, as described in Xxxxxxxxx 0
xxxxx, (xx) Cash Surrenders, as described in Xxxxxxxxx 0 xxxxx, (xxx)
Partial Withdrawals, as described in Paragraph 4 below, and (iv) Annuity
Benefits, as described in Paragraph 5 below.
2. Claims. The Reinsurer will pay the Ceding Company Claims. The term
"Claims," as used in this Agreement, means that portion of the death
benefits paid by the Ceding Company on annuities reinsured hereunder which
is equal to the Reinsurer's quota share of the each surrender value as of
the date the death benefit is payable.
3. Cash Surrenders. The Reinsurer will pay the Ceding Company that portion of
the Cash Surrenders paid by the Ceding Company on annuities reinsured
hereunder which corresponds to the portion of the annuities reinsured
hereunder.
4. Partial Withdrawals. The Reinsurer will pay the Ceding Company that portion
of Partial Withdrawals paid by the Ceding Company on annuities reinsured
hereunder which corresponds to the portion of the annuities reinsured
hereunder.
5. Annuity Benefits. The Reinsurer will pay the Ceding Company that portion of
Annuity Benefits paid by the Ceding Company on annuities reinsured
hereunder which corresponds to the portion of the annuities reinsured
hereunder. The Reinsurer's obligation will be satisfied in full by the
payment to the Ceding Company of that portion of the Account Value, as of
the date of annuitization, which corresponds to the portion of the
annuities reinsured hereunder.
6. Adjustment for Annuity Benefits. For any Accounting Period in which the
calculation of (i) divided by (ii) is greater than [*], the Ceding Company
will pay the Reinsurer an amount equal to (iii) times (iv) where:
(i) equals the account value of annuities reinsured hereunder that
annuitized during the current Accounting Period.
(ii) the average account value of annuities reinsured hereunder during the
current Accounting Period. For the purposes of this calculation, the
average account value of annuities reinsured hereunder is calculated
as one-half the sum of the account values of annuities reinsured
hereunder as of the beginning of the current accounting period and the
account value of annuities reinsured hereunder as of the end of the
current Accounting Period.
(iii) equals a quota share of the Account Value at the time of
annuitization, grouped by policy duration at the time of
annuitization; for the annuities reinsured that annuitized during the
current Accounting Period;
(iv) equals the applicable Annuity Benefit Factor for each policy duration
described below.
POLICY
DURATION ANNUITY BENEFIT
(YEARS) FACTOR
-------- ---------------
1 [*]
2 [*]
3 [*]
4 [*]
5 [*]
6 [*]
7 [*]
8+ [*]
7. Notice. The Ceding Company will notify the Reinsurer at the end of each
Accounting Period regarding Benefit Payments on annuities reinsured
hereunder. The reinsurance claim and copies of notification, claim papers,
and proofs will be furnished to the Reinsurer upon request.
8. Liability and Payment. The Reinsurer will accept the decision of the Ceding
Company with respect to Benefit Payments on annuities reinsured hereunder.
The Reinsurer will pay its proportionate share of Benefit Payments in a
lump sum to the Ceding Company without regard to the form of settlement by
the Ceding Company.
9. Contested Claims. The Ceding Company will advise the Reinsurer of its
intention to contest, compromise or litigate Benefit Payments involving
annuities reinsured hereunder. The Reinsurer will pay its share of the
expenses of such contests, in addition to its share of Benefit Payments, or
it may choose not to participate. If the Reinsurer chooses not to
participate, it will discharge its liability by payment to the Ceding
Company of the full amount of its liability, prior to any contests, on the
annuity reinsured hereunder.
ARTICLE V
RESERVE ADJUSTMENTS
1. Initial Reserve Adjustment. Simultaneous with the payment of the Initial
Consideration described in Article II, Paragraph 1, by the Ceding Company
to the Reinsurer, the Reinsurer will pay the Ceding Company an Initial
Reserve Adjustment in an amount that is equal to the Modified Coinsurance
Reserve determined in accordance with Paragraph 3 below, on the Effective
Date of this Agreement.
2. Modified Coinsurance Reserve Adjustment.
A. The Modified Coinsurance Reserve Adjustment will be computed each
Accounting Period equal to (i) minus (ii) minus (iii), where:
(i) equals the Modified Coinsurance Reserve, determined in
accordance with paragraph 3 below, at the end of the current
Accounting period;
(ii) equals the Modified Coinsurance Reserve, determined in
accordance with paragraph 3 below, at the end of the
preceding Accounting period;
(iii) equals the Modified Coinsurance Reserve Investment Credit,
as described in Schedule C.
With respect, however, to the Accounting Period during which the
Effective Date of this Agreement occurs, the reference in (ii) above
to "the end of the Preceding Accounting Period" refers to the
Effective Date of this Agreement immediately after the Initial Reserve
Adjustment, as described in Paragraph 1 above, has occurred.
B. For any Accounting Period in which the amount computed in A above is
positive, the Reinsurer will pay the Ceding Company such amount. For
any Accounting Period in which the amount computed in A above is
negative, the Ceding Company will pay the Reinsurer the absolute
value of such amount.
3. Modified Coinsurance Reserve. The term "Modified Coinsurance Reserve", as
used in this Agreement, means a quota share of the statutory reserve held
by the Ceding Company with respect to that portion of the annuities
reinsured hereunder. The statutory reserve will be determined by the
Commisionners Annuity Reserve Valuation Method, excluding any reserve for
the minimum guaranteed death benefit.
ARTICLE VI
ADJUSTMENT FOR TRANSFERS INVOLVING
THE FIXED ACCOUNT
1. The Reinsurer will pay the Ceding Company an amount to a quota share of the
amount transferred from the Separate Account to the fixed account for the
annuities reinsured hereunder during the current Accounting Period.
2. The Ceding Company will pay the Reinsurer an amount equal to a quota share
of the amount transferred from the fixed account to the Separate Account
for the annuities reinsured hereunder during the current Accounting Period.
3. The Reinsurer will pay the Ceding Company an amount equal to (i) times (ii)
where:
(i) equals a quota share of the amount transferred from the fixed account
to the Separate Account grouped by policy duration at the time of
transfer; for the annuities reinsured hereunder during the current
Accounting Period;
(ii) equals the applicable Exchange Factor for each policy duration
described in Paragraph 5 below.
4. The Ceding Company will pay the Reinsurer an amount equal to (i) times (ii)
where:
(i) equals a quota share of the amount transferred from the Separate
Account to the fixed account, grouped by policy duration at the time
of transfer; for the annuities reinsured hereunder during the current
Accounting Period;
(ii) equals the applicable Exchange Factor for each policy duration
described in Paragraph 5 below.
5. The exchange factors for each policy duration are shown below:
POLICY DURATION (YEARS) EXCHANGE FACTOR
----------------------- ---------------
1 [*]
2 [*]
3 [*]
4 [*]
5 [*]
6 [*]
7 [*]
8+ [*]
ARTICLE VII
ACCOUNTING AND SETTLEMENTS
1. Quarterly Accounting Period. Each Accounting Period under this Agreement
will be a calendar quarter, except that (a) the initial Accounting Period
runs from the Effective Date of this Agreement through the last day of the
calendar quarter during which the Effective Date of this Agreement falls,
and (b) the final Accounting Period runs from the end of the preceding
Accounting Period until the terminal accounting date of this Agreement as
described in Article IX, Paragraph 2. The amount in Article III, paragraph
4 (i) (a) will be adjusted on a pro-rata basis for time periods less than a
calendar quarter
2. Quarterly Accounting Reports. Quarterly accounting reports in the form of
Schedule B will be submitted to the Reinsurer by the Ceding Company for
each Accounting Period not later than fifteen (15) days after the end of
each Accounting Period. Such reports will include information on the amount
of Reinsurance Premiums, Allowance for Commissions and Expenses, Benefit
Payments, Modified Coinsurance Reserve, and Modified Coinsurance Reserve
Adjustment.
3. Initial Quarterly Settlement.
Within twenty-five (25) days after the initial Accounting Period, the
Ceding Company will pay the Reinsurer the Initial Consideration determined
in accordance with Article II, Paragraph 1. Simultaneously, the Reinsurer
will pay the Ceding Company the sum of: (i) the Initial Reserve Adjustment
determined in accordance with Article V, Paragraph 1, plus (ii) the Initial
Commission determined in accordance with Article III, Paragraph 1.
4. Quarterly Settlements
A. Within twenty-five (25) days after the end of each Accounting Period,
the Ceding Company will pay the Reinsurer the sum of:
(i) Reinsurance Premiums, determined in accordance with Article II,
plus
(ii) any Modified Coinsurance Reserve Adjustment payable to the
Reinsurer, determined in accordance with Article V, Paragraph 2,
plus
(iii) any Adjustment for Transfers Involving the Fixed Account payable
to the Reinsurer, determined in accordance with Article VI, plus
(iv) any Adjustments for Annuity Benefits payable to the Reinsurer,
determined in accordance with Article IV, paragraph 6.
B. Simultaneously, the Reinsurer will pay the Ceding Company the sum of:
(i) the amount of Benefit Payments, as described in Article IV, plus
(ii) the Allowance for Commissions and Expenses, determined in
accordance with Article III, plus
(iii) any Modified Coinsurance Reserve Adjustment payable to the
Ceding Company, determined in accordance with Article V,
Paragraph 2, plus
(iv) any Adjustments for Transfers Involving the Fixed Account payable
to the Ceding Company, determined in accordance with Article VI.
5. Amounts Due Quarterly. Except as otherwise specifically provided in this
Agreement, all amounts due to be paid to either the Ceding Company or the
Reinsurer under this Agreement will be determined on a net basis as of the
last day of each Accounting Period and will be due as of such date and
payable within twenty-five (25) days after the end of the Accounting
Period.
6. Annual Accounting Reports. The Ceding Company will provide the Reinsurer
with annual accounting reports within fifteen (15) days after the end of
the calendar year for which such reports are prepared. These reports will
contain sufficient information about the annuities reinsured hereunder to
enable the Reinsurer to prepare its annual financial reports and to verify
the information reported in Schedule B, and will include Page 7, Page 27
and Schedule S of the Annual Statement.
7. Estimations. If the amounts, as described in Paragraph 4 above, cannot be
determined by the dates described in Paragraph 5 above, on an exact basis,
such payments will be paid in accordance with a mutually agreed upon
formula which will approximate the actual payments. Adjustments will then
be made to reflect actual amounts when they become available.
8. Delayed Payments. For purposes of Paragraph 5 above, if there is a delayed
settlement of a payment due, there will be an interest penalty at [*]. For
purposes of this Paragraph, a payment will be considered overdue thirty
(30) days after the date such payment is payable, and interest shall
commence from the overdue date.
9. Offset of Payments. All moneys due either the Ceding Company or the
Reinsurer under this Agreement will be offset against each other, dollar
for dollar, regardless of any insolvency of either party.
ARTICLE VIII
DURATION AND RECAPTURE
1. Duration. Except as otherwise provided herein, this Agreement is unlimited
in duration.
2. Reinsurer's Liability. The liability of the Reinsurer with respect to any
annuity reinsured hereunder will begin simultaneously with that of the
Ceding Company, but not prior to the Effective Date of this Agreement. The
Reinsurer's liability with respect to any annuity reinsured hereunder will
terminate on the earliest of: (i) the date such annuity is recaptured in
accordance with paragraph 4 below; (ii) the date the Ceding Company's
liability on such annuity is terminated: or (iii) the date this Agreement
is terminated under paragraph 3 below. Termination of the Reinsurer's
liability is subject to payments in respect of such liability in accordance
with the provisions of Article IX of this Agreement. In no event should the
interpretation of this Paragraph imply a unilateral right of the Reinsurer
to terminate this Agreement. However, the Reinsurer and/or the Ceding
Company may, upon thirty (30) days prior written notice to the other party,
terminate thus Agreement as to annuities not yet written by the Ceding
Company as of the effective date of such termination.
3. Termination for Nonpayment of Reinsurance Premiums or other Amounts Due. If
the Ceding Company fails to pay the Reinsurance Premiums or any other
amounts due to the Reinsurer pursuant to this Agreement within sixty (60)
days after the end of any Accounting Period, the Reinsurer may terminate
this Agreement, subject to thirty (30) days prior written notice to the
Ceding Company. If the Reinsurer fails to pay any amounts due to the Ceding
Company pursuant to this Agreement within sixty (60) days after the end of
any Accounting Period, the Ceding Company may terminate this Agreement,
subject to thirty (30) days prior written notice to the Reinsurer.
4. Recapture. Annuities reinsured hereunder will be eligible for recapture, at
the option of the Ceding Company as described below:
(i) On any January 1, all reinsured annuities where the reinsurance under
this Agreement has been in effect for 20 years or longer, subject to
ninety (90) days prior written notice.
(ii) on any other date which is mutually agreed to in writing.
If the Ceding Company opts to recapture, then the Ceding Company must
recapture all of the annuities reinsured hereunder that are eligible for
recapture. In no event may the Ceding Company recapture anything other than
100 percent of all annuities reinsured hereunder that are eligible for
recapture.
5. Internal Replacements. Should the Ceding Company, its affiliates,
successors or assigns, initiate a formal program of Internal Replacement
that would include any of the annuities reinsured hereunder, the Ceding
Company will immediately notify the Reinsurer. For purposes of this
Agreement, the term "Internal Replacement" means any instances in which an
annuity or any portion of the cash value of an annuity which is written by
the Ceding Company, its affiliates, successors, or assigns is exchanged for
another policy or annuity.
The Reinsurer will participate on a quota share basis in any expenses
associated with that program provided reinsurances coverage will continue
under this Agreement for the new policy. The quota share percentage for the
new policy will be same as for the replaced policy, except when the new
policy is otherwise covered by this Agreement, and the quota share on the
old and new policies are different. In that case, the quota share will be
that of the new policy which would otherwise be applicable under this
Agreement, and an amount will be paid which is equal to (i) minus (ii)
where:
(i) equals the account value in the Separate Account of the new policy
times the quota share percentage of the new policy times the Internal
Replacement Exchange Factor below;
(ii) equals the account value in the Separate Account of the old policy
times the quota share percentage of the old policy times the Internal
Replacement Exchange Factor below:
POLICY DURATION OF
REPLACED POLICY INTERNAL REPLACEMENT
(YEARS) EXCHANGE FACTOR
------------------ --------------------
1 [*]
2 [*]
3 [*]
4 [*]
5 [*]
6 [*]
7 [*]
8+ [*]
If the amount calculated above is positive, it will be paid to the Ceding
Company by the Reinsurer. If the amount calculated above is negative, it
will be paid to the Reinsurer by the Ceding Company.
The Ceding Company, its affiliates, successors or assigns, will not initiate a
program of internal replacement that includes any of the annuities
reinsured hereunder, to policies or annuities that are not covered by this
Agreement, without the Reinsurers consent unless the volume of such
internal replacements is incidental. The Reinsurer and the Ceding Company
must mutually agree to the volume of internal replacements to be considered
incidental.
Any incidental internal replacements to an annuity not covered under this
Agreement will cause the reinsurance coverage under this agreement to
terminate for that policy. In that case, the Ceding Company will pay the
Reinsurer an amount equal to (i) times (ii) where:
(i) equals the account value in the Separate Account recaptured by the
Ceding Company;
(ii) equals the recapture factors below;
POLICY DURATION OF INTERNAL
REPLACED POLICY REPLACEMENT
(YEARS) RECAPTURE FACTOR
------------------ ----------------
1 [*]
2 [*]
3 [*]
4 [*]
5 [*]
6 [*]
7 [*]
8+ [*]
The Reinsurer will not participate nor reinsurer Internal Replacements,
where the original policy was not covered by this Agreement.
ARTICLE IX
TERMINAL ACCOUNTING AND SETTLEMENT
1. Terminal Accounting. In the event that this Agreement is terminated in
accordance with Article VIII, Paragraphs 3 or 4, or Article XI, a Terminal
Accounting and Settlement will take place.
2. Date. The terminal accounting date will be the earliest of: (1) the
effective date of recapture pursuant to any notice of recapture given under
this Agreement, (2) the effective date of termination pursuant to any
notice of termination given under this Agreement, or (3) any other date
mutually agreed to in writing.
3. Settlement. The Terminal Accounting and Settlement will consist of:
A. The quarterly settlement as provided in Article VII, Paragraph 4,
computed as of the terminal accounting date as if the treaty were
still in effect, and
B. payment by the Ceding Company to the Reinsurer of a Terminal Reserve
equal to the Modified Coinsurance Reserve on the annuities reinsured
hereunder as of the terminal accounting date;
C. payment by the Reinsurer to the Ceding Company of a Terminal Reserve
Adjustment equal to the Modified Coinsurance Reserve on the annuities
reinsured hereunder as of the terminal accounting date;
If the calculation of the Terminal Accounting and Settlement produces an
amount owing to the Ceding Company, such amount will be paid by the
Reinsurer to the Ceding Company. If the calculations of the Terminal
Accounting and Settlement produces an amount owing to the Reinsurer, such
amount will be paid by the Ceding Company to the Reinsurer
4. Supplementary Accounting and Settlement. In the event that, subsequent to
the Terminal Accounting and Settlement as provided above, a change is made
with respect to any amounts due, a supplementary accounting will take place
pursuant to Paragraph 3 above. Any amount owed to the Ceding Company or to
the Reinsurer by reason of such supplementary accounting will be paid
promptly upon the completion thereof.
ARTICLE X
ARBITRATION
1. General. All disputes and differences between the Ceding Company and the
Reinsurer on which an agreement cannot be reached will be decided by
arbitration. The arbitrators will construe this Agreement from the
standpoint of practical business and equitable principles and the customs
and practices of the insurance and reinsurance business, rather than from
the standpoint of strict law. The parties intend that the arbitrators will
make their decision with a view to effecting the intent of this Agreement.
2. Method. Three arbitrators will decide any differences. They must be
impartial and present or former officers of life insurance companies other
than the parties to this Agreement or any company owned by, or affiliated
with, either party. One of the arbitrators will be appointed by the
Reinsurer, another by the Ceding Company, and the two arbitrators thus
selected will select a third arbitrator before arbitration begins. Should
one of the parties decline to select an arbitrator within thirty (30) days
after the date of a written request to do so, or should the two arbitrators
selected by the parties not be able to agree upon the choice of a third,
the appointment(s) will be left to the President of the American
Arbitration Association or its successor. The arbitrators will decide by a
majority of votes and their decision will be final and binding upon the
parties. The costs of arbitration, including the fees of the arbitrators,
will be shared equally by the parties unless the arbitrators decide
otherwise. Any counsel fees incurred by a party in the conduct of
arbitration will be paid by the party incurring the fees.
3. Arbitration Site. In event of arbitration, the arbitration hearing shall
take place in New York, New York, unless agreed to in writing by both the
Ceding Company and the Reinsurer.
ARTICLE XI
INSOLVENCY
Insolvency. In the event of the Ceding Company's insolvency, any payments due
the Ceding Company from the Reinsurer pursuant to the terms of this Agreement
will be made directly to the Ceding Company or its conservator, liquidator,
receiver or statutory successor. The reinsurance will be payable by the
Reinsurer on the basis of the liability of the Ceding Company under the
annuities reinsured without diminution because of the insolvency of the Ceding
Company. The conservator, liquidator, receiver or statutory successor of the
Ceding Company will give the Reinsurer written notice of the pendency of a claim
against the Ceding Company on any annuity reinsured within a reasonable time
after such claim is filed in the insolvency proceeding. During the pendency of
any such claim, the Reinsurer may investigate such claim and interpose in the
Ceding Company's name (or in the name of the Ceding Company's conservator,
liquidator, receiver or statutory successor), in the proceeding where such claim
is to be adjudicated, any defense or defenses which the Reinsurer may deem
available to the Ceding Company or its conservator, liquidator, receiver or
statutory successor. The expense thus incurred by the Reinsurer will be
chargeable, subject to court approval, against the Ceding Company as a part of
the expense of liquidation to the extent of a proportionate share of the benefit
which may accrue to the Ceding Company solely as a result of the defense
undertaken by the Reinsurer.
In the event of the Reinsurer's insolvency, this treaty will terminate, and the
terminal accounting and settlement described in Article IX will occur. Any
payments due the Reinsurer from the Ceding Company pursuant to the terms of this
Agreement will be made directly to the Reinsurer or its conservator, liquidator,
receiver or statutory successor. Any amounts owed by the Reinsurer to the Ceding
Company will be payable without diminution because of the insolvency of the
Reinsurer. The conservator, liquidator, receiver or statutory successor of the
Reinsurer will give the Ceding Company written notice of the pendency of a claim
against the Reinsurer on any annuity reinsured within a reasonable time after
such claim is filed in the insolvency proceeding.
ARTICLE XII
EXECUTION AND EFFECTIVE DATE
In witness of the above, this Agreement is executed in duplicate on the dates
indicated below with an Effective Date of December 31, 1994.
NORTH AMERICAN SECURITY LIFE XXXXX XXXXXX
INSURANCE COMPANY LIFE INSURANCE COMPANY
("Ceding Company") ("Reinsurer")
on March 29, 1995 on March 30, 1995
By: /s/ illegible By: /s/ illegible
---------------------------------- -----------------------------------
Title: VP-ACTUARY Title: Senior Vice President
By: /s/ illegible By: /s/ illegible
---------------------------------- -----------------------------------
Title: VP Treasurer & CFO Title: Vice President
24
SCHEDULE A
ANNUITIES AND RISKS REINSURED
Annuities and Risks Reinsured. The amount of reinsurance under this Agreement
will be a percent quota share of the Ceding Company's net liability, with
respect to the separate account, on those variable annuities and the
corresponding state and group variations thereof listed below that are issued
by the Ceding Company and sold by the PaineWebber Affiliates listed below.
Policies included in the Initial Consideration calculation of Article II,
paragraph I, will be included in this Agreement if the agency of record as of
the Effective Date of this Agreement is one of the PaineWebber Affiliates listed
below, instead of if it was sold by the PaineWebber Affiliates listed below. Any
policies covered by this Agreement will continue to be covered even if the
agency of record is changed subsequent to the Effective Date of this Agreement.
Venture Variable Annuity Plans
Description Policy Form Numbers Quota Share
----------- ---------------------------------------- -----------
Category A - All contracts beginning with form [*]
Individual Contracts with a 6 year number 207, except:
surrender charge and a 6 year (i) exclude form 207-VFA-NY
step-up death benefit (ii) include form VFA-MN
Category B - All contracts beginning with form [*]
Individual Contracts with a 6 year number 207 which have form
surrender charge and yearly ENDORSEMENT.005 attached, except:
step-up death benefit (i) exclude form 207-VFA-NY
(ii) include contracts issued in
Montana which use form
ENDORSEMENT.005.94
All contracts beginning with form VFA-MN
with form ENDORSEMENT.005 attached.
Description Policy Form Numbers Quota Share
----------- ---------------------------------------- -----------
Category C - Group Contracts with a All certificates beginning with [*]
6 year surrender charge and a 6 form VFA-CERT
year step-up death benefit
Category D - Group Contracts with a 6 All certificates beginning with form [*]
year surrender charge and yearly VFA-CERT which have ENDORSEMENT.007
step-up death benefit attached.
Category E - Individual Contracts All contracts with form numbers [*]
with a 7 year surrender charge VENTURE.001, VENTURE.001.94 and
and yearly step-up death benefit VENTURE.005
Category F - Group Contracts with a All certificates with form number [*]
7 year surrender charge and yearly VENTURE.003
step-up death benefit
PaineWebber Affiliates Tax ID Number
----------------------------------- -------------
PWJC Agency, Inc. 00-0000000
PWJC Sales Agency 00-0000000
PWJC Insurance Agency Massachusetts 00-0000000
PWJC Insurance Sales Arizona 00-0000000
PWJC Agency Illinois 00-0000000
PWJC Insurance Agency Oklahoma 00-0000000
PWJC Insurance Sales Wyoming 00-0000000
PWJC Insurance Sales Montana, Inc. 00-0000000
PW Insurance Agency of Ohio 00-0000000
PW Insurance Agency Arkansas 00-0000000
PWJC Insurance Agency Texas 00-0000000
Rotan Mosle Insurance Agency, Inc 00-000-0000
"Net liability," as used in this Agreement, means the Coding Company's liability
on the annuities reinsured hereunder, loss amounts recoverable from other
reinsurance.
SCHEDULE B
QUARTERLY REPORT OF ACTIVITY AND SETTLEMENTS
FROM CEDING COMPANY TO REINSURER
Accounting Period:_________________
Calender Year: ____________________
Date Report Completed: _____________
1. Reinsurance Premiums (Article II) _____
2. Benefit Payments (Article IV)
a. Claims _____
b. Cash Surrender Values _____
c. Partial Withdrawals _____
d. Annuity Benefits _____
Benefit Payments = a + b + c + d _____
3. Modified Coinsurance Reserve Adjustment (Article V)
a. Modeo Reserve end of current Accounting Period _____
b. Modeo Reserve end of preceding Accounting Period _____
c. Equals a - b _____
d. Modeo Reserve Investment Credit (Schedule C) _____
Modified Coinsurance Reserve Adjustment = c - d _____
4. Allowance for Expenses and Death Benefit Guarantees (Article III) _____
5. Transfers Insolving the Fixed Account (Article VI)
a. Quota share of transfers from Fixed Account to Separate Account
during the current Accounting Period (paragraph 1) _____
b. Quota share of transfers from Separate Account to Fixed Account
during the current Accounting Period (paragraph 2) _____
Transfers Involving the Fixed Account = a - b _____
6. Adjustment for Transfers Involving the Fixed Account (Article VI)
a. Adjustment for transfers from the Fixed Account to the Separate
Account (paragraph 3) _____
b. Adjustment for transfers from the Separate Account to the Fixed
Account (paragraph 4) _____
Adjustment for Transfers Involving the Fixed Account = a - b _____
7. Adjustment for Annuity Benefits (Article IV, paragraph 6) _____
8. Adjustment for Internal Replacements (Article VIII, paragraph 5)
a. Quota share of replaced policy account value in Separate Account _____
b. Adjustment for replaced reinsured policy _____
c. Quota share of new policy account value in Separate Account _____
d. Adjustment for new reinsured policy _____
Adjustment for Internal Replacements = (a-b-c+d) _____
9. Cash Settlement = 1 + 2 + 3 + 4 + 5 + 6 + 7 + 8 _____
SUPPLEMENTAL INFORMATION
Total Variable Premium received during
Number Annuity Total Period
of Fund Fund --------------------------
Annuities Value Value qualified non-quailified
--------- -------- ----- --------- --------------
Beginning of Period _____ _____ _____ _____ _____
+ New Issues _____ _____ _____
- Terminations _____ _____ _____
End of Period _____ _____ _____
Number of Venture Variable
Variable Annuities Account Reserve
------------------ ---------------
Beginning of Period _____ _____
+ New Issues _____ _____
- Terminations _____ _____
End of Period _____ _____
Allowance for Commission and Expense (Article III)
a. quota share of premium taxes paid on annuities reinsured hereunder _____
b. quota share of commissions paid on annuities reinsured hereunder _____
c. [*] quota share of Venture anuities reinsured hereunder _____
d. Number of Venture annuities reinsured hereunder _____
e. [*] quota share of Venture annuities reinsured hereunder _____
f. Number of Venture annuities issues during the current Accounting Period _____
g. [*] _____
h. Reinsurance Premiums received from non-qualified contracts _____
i. [*] quota share of the account values at the end of the Accounting
Period on annuities reinsured hereunder _____
j. [*] _____
k. Difference between quota share of account value, and Modified Coinsurance
Reserve at end of the Accounting Period on annuities reinsured hereunder _____
l. [*] quota share of the account values at the end of the Accounting
Period on Category A & C annuties _____
m. [*] quota share of the account values at the end of the Accounting
Period on Category B, D, E, & F annuities _____
n. Commission and Expense Allowance = a+b+(c x d)+(e x f)+(g x h)+i + j + k + l + m _____
Data for Calculating Adjustment for Transfers Involving the Fixed Account
Venture
------------------------------------------------------
Adjustment Adjustment
Transfers for Transfers Transfers for Transfers
to Fixed to Fixed from Fixed from Fixed
Duration Account Account Account Account
-------- --------- ------------- ---------- -------------
1 _________ _____________ __________ _____________
2 _________ _____________ __________ _____________
3 _________ _____________ __________ _____________
4 _________ _____________ __________ _____________
5 _________ _____________ __________ _____________
6 _________ _____________ __________ _____________
7 _________ _____________ __________ _____________
8+ _________ _____________ __________ _____________
Data for Calculating Adjustment for Internal Replacements
Venture
-------------------------------------------------
Reinsured Reinsured
Separate Separate
Account Account
Value of Adjustment Value of Adjustment
Replaced For Replaced New For New
Duration Policy Policy Policy Policy
-------- --------- ------------ --------- ----------
1 _________ ____________ _________ __________
2 _________ ____________ _________ __________
3 _________ ____________ _________ __________
4 _________ ____________ _________ __________
5 _________ ____________ _________ __________
6 _________ ____________ _________ __________
7 _________ ____________ _________ __________
8+ _________ ____________ _________ __________
Data for Calculating Adjustment for Annuity Benefits
(1) (2) (3)
Account Account Account
Value Value End Value (4) (5)
Beginning of of Annuitized Annuitization Excess
Accounting Accounting Current Rate Annuitization
Duration Period Period Period (3)/[[(1)+(2)]/2] [*]
-------- ------------ ---------- ---------- ----------------- -------------
1
2
3
4
5
6+
(6) (9)
Acct Value Annuity
Annuitized (8) Benefits
Current Adjustment Adjustment
Duration Period [*] Factor (7) x (8)
-------- ---------- ------------- ---------- ----------
1 [*]
2 [*]
3 [*]
4 [*]
5 [*]
6+ [*]
SUPPLEMENTAL DATA PROVIDED BY THE CEDING COMPANY
A. Reinsurer's portion of M & E charges collected during the current
accounting period on the policies reinsured hereunder.
B. Reinsurer's portion of Administrative Charges collected during the current
accounting period on the policies reinsured hereunder.
C. Reinsurer's portion of Surrender Charges collected during the current
accounting period on the policies reinsured hereunder.
D. Reinsurer's portion of First Year Commissions paid during the current
accounting period on the policies reinsured hereunder.
E. Reinsurer's portion of Renewal Commissions paid during the current
accounting period on the policies reinsured hereunder.
SCHEDULE C
MODIFIED COINSURANCE RESERVE INVESTMENT CREDIT
Modified Coinsurance Reserve Investment Credit. The Modified Coinsurance Reserve
Investment Credit is equal to the portion of the sum of all accrued investment
income and capital gains and losses, realized and unrealized, on the mutual
funds underlying the Ceding Company's Separate Account for the current
Accounting Period which corresponds to the portion of the variable annuities
reinsured hereunder.
For Venture Annuities reinsured hereunder, the Modified Coinsurance Reserve
Investment Credit will be adjustment for income taxes or changes in any
provision for taxes. It will be reduced for investment management fees in excess
of [*] and any other fund level charges. It will not be reduced for mortality
and expense risk charges or administrative charges as defined in the annuity
contracts.
SCHEDULE D
COMMISSION SCHEDULES
Schedule 1
Commission as percent of premium payable in all policy durations [*]
Commission as percent of account value payable in all durations [*]
Schedule 2
Commission as percent of premium payable in all policy durations [*]
Commission as percent of account value payable in all durations [*]
AMENDMENT 1
The following amends the Reinsurance Agreement between formerly North American
Security Life Insurance Company (hereinafter referred to as the "Ceding
Company") and PaineWebber Life Insurance Company (hereinafter referred to as
the "Reinsurer") effective on June 1, 1994 (hereinafter referred to as the
"Original Agreement").
Effective October 1, 1997, North American Security Life Insurance Company
changed its name to The Manufacturers Life Insurance Company of North America.
This agreement is hereby amended to reflect this change.
Schedule A in the Original Agreement is replaced to reduce the quota share in
Category E and Category F [*] for contracts or certificates issued on January 1,
1997 or later, as described in the attachment to this Amendment.
Article III, Paragraph 4 of the Original Agreement is changed as follows:
The first sentence of Paragraph 4 will read "The Reinsurer will pay the Ceding
Company an Allowance for Expenses for each Accounting Period equal to the sum of
(i) plus (ii) plus (iii) plus (iv) plus (v) plus (vii) plus (viii) plus (ix),
where;"
Add the following parts (vii), (viii), and (ix) to Paragraph 4:
(vii) equals the Expense Reimbursement Allowance, as described in paragraph 2 of
the attached letter dated June 27, 1997, paid on account of the Reinsurance
Premiums received during the current Accounting Period.
(viii) equals the New Assets under Management payment, as described in paragraph
3 of the attached letter dated June 27, 1997, paid on account of the quota
share of the Account Values in the Variable Separate Accounts of the
annuities reinsured hereunder during the current Accounting Period.
(ix) equals the Persistency Bonus payment, as described in paragraph 4 of the
attached letter dated June 27, 1997, paid on account of the quota share of
Account Values in the Variable Separate Accounts of the annuities reinsured
hereunder during the current Accounting Period.
In witness of the above, this Amendment is executed in duplicate on the dates
indicated below with an Effective Date of January 1, 1997.
THE MANUFACTURERS LIFE INSURANCE PAINEWEBBER LIFE INSURANCE COMPANY
COMPANY OF NORTH AMERICA ("Reinsurer")
("Ceding Company")
On Dec 23, 1997 On Dec 22, 1997
By: /s/ illegible By: /s/ illegible
--------------------------------- ------------------------------------
Title: Vice President Title: Senior Vice President
By: /s/ illegible By: /s/ illegible
--------------------------------- ------------------------------------
Title: VICE PRESIDENT, SECRETARY & Title: VICE PRESIDENT
GENERAL COUNSEL
SCHEDULE A
ANNUITIES AND RISKS REINSURED
Annuities and Risk Reinsured. The amount of reinsurance under this Agreement
will be a percent quota share of the Ceding Company's net liability, with
respect to the separate account, on these variable annuities and the
corresponding state and group variations thereof listed below that are issued by
the Ceding Company and sold by the PaineWebber Affiliates listed below. Policies
included in the initial Consideration calculation of Article II, paragraph I,
will be included in this Agreement if the agency of record as of the Effective
Date of this Agreement is one of the PaineWebber Affiliates listed below,
instead of if it was sold by the PaineWebber Affiliates listed below. Any
policies covered by this Agreement will continues to be covered even if the
agency of record is changed subsequent to the Effective Date of this Agreement.
Venture Variable Annuity Plans
Description Policy Form Numbers Quota Share
----------- ------------------------------------------------------ ----------------------
Category A - Individual All contracts beginning with form number 207, except: [*]
Contracts with a 6 year
surrender charge and a 6 year (i) exclude form 207-VFA-NY
step-up death benefit
(ii) include form VFA-MN
Category B - Individual All contracts beginning with form number 207 which [*]
Contracts with a 6 year have form ENDORSEMENT.005 attached, except:
surrender charge and yearly
step-up death benefit (i) exclude form 207-VFA-NY
(ii) include contracts issued in Montana which use
form ENDORSEMENT.005.94
All contracts beginning with form VFA-MN with form
ENDORSEMENT.005 attached.
Description Policy Form Numbers Quota Share
----------- ------------------------------------------------------ ----------------------
Category C - Group All certificates beginning with form VFA-CERT. [*]
Contracts with a 6 year
surrender charge and a 6 year
step-up death benefit
Category D - Group All certificates beginning with form VFA-CERT which [*]
Contracts with a 6 year have ENDORSEMENT .007 attached.
surrender charge and yearly
step-up death benefit
Category E - Individual All contracts with form numbers VENTURE.001, [*] for contracts
Contracts with a 7 year VENTURE.001.94, and VENTURE.005. issued on or before
surrender charge and yearly December 31, 1996, [*]
step-up death benefit for contracts issued
on or after January 1,
1997
Category F - Group Contracts All certificates with form number VENTURE.003. [*] for certificates
with a 7 year surrender issued on or before
charge and yearly December 31, 1996, [*]
step-up death benefit for certificates
issued on or after
January 1, 1997
Tax ID
PaineWebber Affiliates Number
----------------------------------- -----------
PWJC Agency, Inc. 00-0000000
PWJC Sales Agency 00-0000000
PWJC Insurance Agency Massachusetts 00-0000000
PWJC Insurance Sales Arizona 00-0000000
PWJC Agency Illinois 00-0000000
PWJC Insurance Agency Oklahoma 00-0000000
PWJC Insurance Sales Wyoming 00-0000000
PWJC Insurance Sales Montana, Inc. 00-0000000
PW Insurance Agency of Ohio 00-0000000
PW Insurance Agency Arkansas 00-0000000
PWJC Insurance Agency Texas 00-0000000
Rotan Mosle Insurance Agency, Inc 00-000-0000
"Net liability," as used in this Agreement, means the Ceding Company's
liability on the annuities reinsured hereunder, less amounts recoverable from
other reinsurance.
PaineWebber Incorporated
0000 Xxxxxx Xxxx.
Xxxxxxxxx, XX00000-0000
000-000-0000
Xxxxxx X. Xxxxxxxx
President, Insurance Sales & Marketing
(PAINEWEBBER LOGO)
June 27, 1997
Xxxx XxXxxxxx
Vice President
North American Security Life Insurance Company
00 Xxxxxxx Xxxxxx
Xxxxxx, XX 00000-0000
RE: Relationship Enhancement Agreement
Dear Xxxx:
This letter is intended to serve as our agreement regarding the Relationship
Enhancement Program that we have discussed. Please note that this Agreement is
in addition to (and does not replace) our existing written agreement(s)
involving PaineWebber and/or its subsidiary and affiliate companies (hereinafter
"PaineWebber"). This Agreement controls in the event of a conflict with any
earlier agreement. In addition, any changes to any other agreement(s) between
our respective firms shall not affect this Agreement unless this Agreement is
specifically referenced in writing in the document.
For consideration as described below and including:
a) PaineWebber allowing you to continue marketing your products through its
distribution system (subject to PaineWebber's policies and controls over
such activities), and
b) PaineWebber allowing you to participate in training and education meetings
for its employees,
you agree to the following terms and conditions:
1) Commitment Consideration
One time payment to PaineWebber [*]. Payable coincident with the execution
of this agreement, or earlier.
2) Expense Reimbursement Allowance
Premium based payment based on cumulative sales within a calendar year.
Measurement begins on January 1, 1997. Premium measurements are based on
the sum of variable annuity and fixed annuity premiums. ERA's are in
addition to current normal marketing and educational support efforts which
are provided to PaineWebber. Marketing and educational expenditures that
are manually agreed upon by PaineWebber and Xxxx Xxxxx Associates and/or
North American Security Life to be in excess of the current normal
marketing and educational support provided by Xxxx
Xxxxx Associates will offset the ERA payment. ERA levels are:
Annual Sales
(million) ERA Level
------------ ---------------
$0 - 49 [*]
$50 - 149 [*]
$150 - 249 [*]
$250 + [*]
ERA payments are made quarterly. Each quarter, the year-to-date premium is
annualized and the ERA level is based on the annualized premium level. The
ERA level is applied to year-to-date premiums to determine the year-to-date
ERA payment. The year-to-date ERA payment will be reduced by any agreed
upon ERA offset. The current quarter's ERA payment is equal to the
year-to-date ERA payment minus the ERA payment made in prior quarters for
the current calendar year.
The ERA will be paid by Xxxx Xxxxx Associates.
3) New Assets Under Management
[*] of variable annuity account values on a recurring basis, for all
inforce assets for new contracts issued January 1, 1997 and later. Excludes
fixed annuities and fixed accounts within variable annuities. Paid on a
quarterly basis as [*] of eligible account values. Initial payment is
calculated as of the end of the first quarter of 1997.
4) Persistency Bonus
A payment will be made on all variable annuity assets originally issued
with PaineWebber that have ended a policy year beyond the surrender charge
period. Assets in fixed annuities and fixed accounts within variable
annuities are excluded. The payment will equal a stated number of basis
points times "Excess Assets". For the current Venture products, the number
of basis points is [*] for policies that pay a trail commission to the
broker, and [*] for policies that do not pay a trail commission to the
broker. Future and existing products may utilize a different number of
basis points in the future, determined in a manner consistent with the
concept of sharing profits on Excess Assets on an equal basis between
PaineWebber and NASL. Excess Assets equal actual assets minus "Target
Assets". Target Assets are defined in Exhibit 1.
The minimum persistency bonus payment for calendar years 1998 and 1999 will
be [*] per year.
Payments will be paid on a quarterly basis. At the close of a calendar
quarter, a persistency bonus calculation will be done, and payment made,
for all policies which have ended a policy year beyond the surrender charge
period. The initial payment is
calculated as of the end of the first quarter of 1997.
5) Modified Coinsurance
North American Security Life Insurance Company currently has a modified
coinsurance agreement in place with PaineWebber Life which cedes a [*]
share of the new variable annuity business which is generated by
PaineWebber. The quota share under this agreement will reduce to [*] for
new business sold January 1, 1997 and later.
6) Exclusions
Items (2), (3), and (4) will not apply to:
Any fixed product "syndicates", i.e., fixed products where the pricing is
negotiated at the time of the offering.
Venture Vision and UGA products.
7) Due Diligence
You agree to participate in PaineWebber's insurance company financial due
diligence review program, including any reasonable costs regularly charged
by PaineWebber's outside due diligence consultant.
8) Confidentiality
All parties agree to keep confidential the specific terms and details of
this Agreement except for required disclosure to regulatory authorities or
by subpoena or court order.
9) Termination
All business written prior to termination of this Supplemental Agreement is
vested ("Vested Business") for purposes of payments due under this
Supplemental Agreement. As such, payments shall continue to be made on all
Vested Business after termination of this Supplemental Agreement in
accordance with the terms of same. Any new business written subsequent to
the termination of the Supplemental Agreement shall not be the subject of
any payments under this Supplemental Agreement and commissions and other
payments for post termination new business will be governed by the sales
agreement(s) then in effect between the parties.
10) Notice of Termination
This agreement may be terminated without cause by either party by giving
written notice of termination to the other party via certified mail return
receipt requested at the following address:
If to PaineWebber:
PaineWebber Incorporated
0000 Xxxxxx Xxxx.-0xx Xxxxx
Xxxxxxxxx, XX 00000
Attn: Product Manager-Insurance
with copy to:
PaineWebber Incorporated
0000 Xxxxxx Xxxx.-00xx Xxxxx
Xxxxxxxxx, XX 00000
Attn: Legal Dept.-Retail Product Group
If to carrier:
North American Security Life Insurance Company
00 Xxxxxxx Xxxxxx
Xxxxxx, XX 00000-00000
Attn: Xxx Xxxxxxxxx, General Counsel
11) Jurisdiction
This Agreement shall be governed by the laws of the State of New York.
12) Arbitration
Any claims, disputes or controversies arising out of this Agreement shall
be settled exclusively by arbitration under the rules of the National
Association of Securities Dealers Regulation, Inc. ("NASDR"). The decision
of the NASDR arbitrators shall be final and judgement upon the decision may
be entered in any court of competent jurisdiction in the State of New York.
PAINEWEBBER INCORPORATED NORTH AMERICAN SECURITY LIFE INSURANCE
COMPANY
by /s/ illegible by /s/ Xxxx XxxXxxx III
--------------------------------- ------------------------------------
Title: Senior Vice President Title: President
XXXX XXXXX ASSOCIATES
by /s/ A. Xxxxx Xxxxx
-------------------------------------
Title: President
Exhibit I
TargetAssets(+) = Projected assets as of a calendar quarter end for contracts
that have reached their calendar anniversary within 3 months
prior to the calendar quarter end provided they are 1 year or
more past their initial contingent deferred sales charge
(CDSC) period.
(TargetAssets are projected from issue or 12/31/96, which ever
is later, therefore, for issues prior to 12/31/96,
TargetAssets (12/31/96) = ActualAssets (12/31/96))
TargetAssets(1)= (1) + (2) + (3) - (4);
(1) TargetAssets(+-1) * (1+Interest(+)) *
(1-Lapse(+)) * (1-Slapse(+)) *
(1-Pwith(+)) * (1-Mort(+))
(2) RenewalDep(+) * (1+Interest(+)) *
(1-Lapse(+)) * (1-Slapse(+)) *
(1-Pwith(+)) * (1-Mort(+))
(3) VarTransfers(+)* (1+Interest(+)) *
(1-Lapse(+)) * (1-Slapse(+)) *
(1-Pwith(+)) * (1-Mort(+))
(4) FixedTransfers(+)* (1+Interest(+)) *
(1-Lapse(+)) * (1-Slapse(+)) *
(1-Pwith(+)) * (1-Mort(+))
RenewalDep(+) = Renewal Deposits during year +.
VarTransfers(+) = Transfers from Fixed to Variable subaccounts during year +.
FixedTransfers(+) = Transfers to Fixed from Variable subaccounts during year +.
ActualAssets(+) = Actual in force assets as of a calendar quarter end for
contracts that have reached their calendar anniversary
within 3 months prior to the calendar quarter end provided
they are 1 year or more past their initial CDSC period.
Lapse(+) = Assumed annual lapse rate.
Slapse(+) = Assumed shock lapse rate (occurs at the termination of the
CDSC period).
Pwith(+) = Assumed annual partial withdrawal.
Mort(+) = Assumed mortality rate.
Interest(+) = Assumed net credited rate to contract owner.
MarginRev(+) = Annual Marginal Revenue.
Pbonus(+) = MarginRev(+)* (ActualAssets(+) - TargetAssets(+))
A) Xxxxx Xxxxxx'x Share of Net Marginal Revenue
Venture Trail
Issue Quarter
-------------------------------------------------
Revenue (-'96Q2) ('96Q3) ('96Q4) ('97Q1) ('97Q2-)
-------------------------------- -------- ------- ------- ------- --------
Mortality & Expense Risk Charge [*] [*] [*] [*] [*]
Administration Charge [*] [*] [*] [*] [*]
Distribution Charge [*] [*] [*] [*] [*]
Advisory Spread [*] [*] [*] [*] [*]
Total Revenue [*] [*] [*] [*] [*]
Expenses
Trail [*] [*] [*] [*] [*]
New Assets Under Management [*] [*] [*] [*] [*]
Administration Asset Based [*] [*] [*] [*] [*]
Administration per policy ($73)* [*] [*] [*] [*] [*]
Enhanced Death Benefit [*] [*] [*] [*] [*]
Total Expenses [*] [*] [*] [*] [*]
Total Net Marginal Revenue [*] [*] [*] [*] [*]
Net Marginal Revenue [*] [*] [*] [*] [*]
(to Xxxxx Xxxxxx)=
[MarginRev(+)]
Venture No Trail
Issue Quarter
-----------------
Revenue (-96Q4) (97Q1-)
-------------------------------- ------- -------
Mortality & Expense Risk Charge [*] [*]
Administration Charge [*] [*]
Distribution Charge [*] [*]
Advisory Spread [*] [*]
Total Revenue [*] [*]
Expenses
Trail [*] [*]
New Assets Under Management [*] [*]
Administration Asset Based [*] [*]
Administration per policy ($73)* [*] [*]
Enhanced Death Benefit [*] [*]
Total Expenses [*] [*]
Total Net Marginal Revenue [*] [*]
Net Marginal Revenue [*] [*]
(to Xxxxx Xxxxxx)=[MarginRev(+)]
* Administration per policy assumes an average size of $42,000 for Venture.
B) Lapse Rates (with spike lapse [trail (-'96Q2); trail ('96Q3-); no trail])
Old Gen New Gen
Duration Venture Venture
-------- ------- -------
[*] [*]
2 [*] [*]
3 [*] [*]
4 [*] [*]
5 [*] [*]
6 [*] [*]
7 [*] [*]
8 [*] [*]
9 [*] [*]
10 [*] [*]
11 [*] [*]
12 [*] [*]
13 [*] [*]
14 [*] [*]
15 [*] [*]
16 [*] [*]
17 [*] [*]
18 [*] [*]
19 [*] [*]
20 [*] [*]
C) PARTIAL WITHDRAWALS
Duration Venture
-------- -------
1 [*]
2 [*]
3 [*]
4 [*]
5 [*]
6 [*]
7 [*]
8 [*]
9 [*]
10 [*]
11 [*]
12 [*]
13 [*]
14 [*]
15 [*]
16 [*]
17 [*]
18 [*]
19 [*]
20 [*]
D) MORTALITY
[assumed issue age 57]
(1000q)
Duration Venture
-------- -------
1 [*]
2 [*]
3 [*]
4 [*]
5 [*]
6 [*]
7 [*]
8 [*]
9 [*]
10 [*]
11 [*]
12 [*]
13 [*]
14 [*]
15 [*]
16 [*]
17 [*]
18 [*]
19 [*]
20 [*]
E) NET CREDITED RATE
[*] for all durations.
AMENDMENT NO. II
To the Reinsurance Agreement
Between
The Manufacturers Life Insurance Company of North America
And
PaineWebber Life Insurance Company.
Except as hereinafter specified all terms and conditions of the Reinsurance
Agreement effective the 31st day of December, 1994, amendments and addenda
attached thereto, shall apply, and this Amendment is to be attached to and made
a part of the aforesaid Agreement.
It is mutually agreed that effective the 15th day of March, 1999;
A. ARTICLE VI, Paragraph 5, Adjustment for Transfers Involving the Fixed
Accounts, is revised as attached.
B. ARTICLE VIII, Paragraph 5, Duration and Recapture, is revised as attached.
C. Schedule A, Annuities and Risks Reinsured, is revised as attached.
D. Schedule D, Commission Schedules, is as attached.
IN WITNESS WHEREOF, the Company and PaineWebber Life Insurance Company have
caused their names to be subscribed and duly attested hereunder by their
respective Authorized Officers.
The Manufactures Life Insurance Company of North America
By: /s/ Xxxx XxXxxxxx Attest: /s/ illegible
--------------------------------- --------------------------------
Title: VP US Annuities Title: AVP Product Development
Date: June 14, 1999 Date: June 14, 1999
PaineWebber Life Insurance Company
By: /s/ illegible Attest: /s/ illegible
--------------------------------- --------------------------------
Title: Vice President Title: Vice President
Date: June 16, 1999 Date: June 16, 1999
THE MANUFACTURERS LIFE INSURANCE COMPANY OF NORTH AMERICA
REINSURANCE AGREEMENT EFFECTIVE DECEMBER 31, 1994
AMENDMENT II EFFECTIVE MARCH 15, 1999
AMENDMENT NO. II (Continued)
ARTICLE VI
ADJUSTMENT FOR TRANSFERS INVOLVING THE FIXED ACCOUNTS
5. The Exchange Factors for each policy duration are shown below:
For contracts covered under Schedule A, the following Exchange Factors are a
percentage of the Account Value transferred
POLICY DURATION COMMISSION COMMISSION COMMISSION
(YEARS) OPTION A OPTION B OPTION C
--------------- ---------- ---------- ----------
1 [*] [*] [*]
2 [*] [*] [*]
3 [*] [*] [*]
4 [*] [*] [*]
5 [*] [*] [*]
6 [*] [*] [*]
7 [*] [*] [*]
8+ [*] [*] [*]
THE MANUFACTURERS LIFE INSURANCE COMPANY OF NORTH AMERICA
REINSURANCE AGREEMENT EFFECTIVE DECEMBER 31, 1994
AMENDMENT II EFFECTIVE MARCH 15, 1999
AMENDMENT NO. II (Continued)
ARTICLE VIII
DURATION AND RECAPTURE
5. Internal Replacements. Should the Coding Company, its affiliates,
successors, or assigns, initiates a formal program of Internal Replacement
that would include any of the annuities reinsured hereunder, that Coding
Company will immediately notify the Reinsurer. For purposes of this
Agreement, the term "Internal Replacement" means any instance in which an
annuity or any portion of the cash value of an annuity which is written by
the Coding Company, its affiliates, successors, or assigns, is exchanged
for another policy or annuity.
The Reinsurer will participate on a quota share basis in any expense
associated with that program provided the reinsurance coverage will
continue under this agreement for the new policy. The quota share
percentage for the new policy will be same as that for the replaced policy,
except when the new policy is otherwise covered by this Agreement, and the
quota share percentage on the old and new policies are different. In that
case, the quota share percentage will be that of the new policy which
would otherwise be applicable under this Agreement, and an amount will be
paid which is equal to (i) minus (ii) where:
(i) equals the amount value in the Separate Account of the new policy
times the quota share percentage of new policy times the Internal
Replacement Exchange Factor below:
(ii) equals the amount value in the Separate Account of the old policy
times the quota share percentage of the old policy times the Internal
Replacement Exchange Factor below:
For contracts covered under Schedule A, the following Internal Replacement
Exchange Factors are a percentage of the Account Value transferred.
POLICY DURATION COMMISSION COMMISSION COMMISSION
(YEARS) OPTION A OPTION B OPTION C
--------------- ---------- ---------- ----------
1 [*] [*] [*]
2 [*] [*] [*]
3 [*] [*] [*]
4 [*] [*] [*]
5 [*] [*] [*]
6 [*] [*] [*]
7 [*] [*] [*]
8+ [*] [*] [*]
If the amount calculated above is positive, it will be paid to the Coding
Company by the Reinsurer. If the amount calculated above is negative, it
will be paid to the Reinsurer by the Coding Company.
The Coding Company, its affiliates, successors, or assigns will not
initiate a program of internal replacement that includes any annuities
reinsured hereunder, to policies or annuities that are not covered under
this Agreement, without the Reinsured consent unless the volume of such
internal replacements is incidental. The Reinsurer and the Company must
mutually agree to the volume of internal replacements to be considered
incidental.
THE MANUFACTURERS LIFE INSURANCE COMPANY OF NORTH AMERICA
REINSURANCE AGREEMENT EFFECTIVE DECEMBER 31, 1994
AMENDMENT II EFFECTIVE MARCH 15, 1999
AMENDMENT NO. II (Continued)
ARTICLE VIII (Continued)
DURATION AND RECAPTURE
Any incident Internal replacement as an annuity not covered under this
Agreement will cause the reinsurance coverage under the Agreement to
terminate for that policy. In that case, the Coding Company will pay the
Reinsure an amount equal to (i) times (ii) where:
(i) equals the amount value in the Separate Account recaptured by the
Coding Company:
(ii) equals the Recapture Factor below:
For contracts covered under Schedule A, the following Recapture Factors are
a percentage of the Account Value transferred.
POLICY DURATION COMMISSION COMMISSION COMMISSION
(YEARS) OPTION A OPTION B OPTION C
--------------- ---------- ---------- ----------
1 [*] [*] [*]
2 [*] [*] [*]
3 [*] [*] [*]
4 [*] [*] [*]
5 [*] [*] [*]
6 [*] [*] [*]
7 [*] [*] [*]
8+ [*] [*] [*]
The Reinsurer will not participate not reinsure Internal Replacements,
where the original policy was not covered by this Agreement.
THE MANUFACTURERS LIFE INSURANCE COMPANY OF NORTH AMERICA
REINSURANCE AGREEMENT EFFECTIVE DECEMBER 31, 1994
AMENDMENT II EFFECTIVE MARCH 15, 1999
AMENDMENT NO. II (Continued)
SCHEDULE A
ANNUITIES AND RISK REINSURED
Annuities and Risks Reinsured: The amount of reinsurance under this Agreement
will be a percent quota share of the Coding Company's net liability, with
respect to the separate account, on those variable annuities and the
corresponding state and group variations thereof listed below that are issued by
the Ceding Company and sold by PaineWebber Affiliates listed below. Policies
included in the Initial Consideration calculation of the Article II, paragraph
I, will be included in this Agreement in the agency of record as of the
Effective Date of the Agreement is one of the PaineWebber Affiliates listed
below. Any policies covered under this Agreement will continue to be covered
even if the agency of record is changed subsequent to the Effective Date of this
Agreement.
Venture Variable Annuity Plans
Description Policy Form Numbers Quota Share
------------ ----------------------------------------------------- -----------
Category A - Individual Contracts All Contracts beginning with form number 207, except: [*]
with a 6 year surrender charge and
a 6 year step-up death benefit. (i) Exclude form 207- VFA-NY
ALL COMMISION OPTIONS (ii) Include form VFA-MN
Category B - Individual Contracts All Contracts beginning with form number 207 [*]
with a 6 year surrender charge and which have form ENDORSEMENT.005 attached, except:
a yearly step-up death benefit.
(i) Exclude form 207- VFA-NY
ALL COMMISION OPTIONS
(ii) Include form VFA-MN with form ENDORSEMENT
.005 attached
(iii) include contracts in Montana with form
ENDORSEMENT.005.94 attached
Category C - Group Contracts with a All certificates with form VFA-CERT [*]
6 year surrender charge and a 6
year step-up death benefit.
ALL COMMISION OPTIONS
Category D - Group Contracts with a All certificates with form VFA-CERT which have [*]
6 year surrender charge and a ENDORSEMENT .007 attached
yearly step-up death benefit.
ALL COMMISION OPTIONS
THE MANUFACTURERS LIFE INSURANCE COMPANY OF NORTH AMERICA
REINSURANCE AGREEMENT EFFECTIVE DECEMBER 31, 1994
AMENDMENT II EFFECTIVE MARCH 15, 1999
AMENDMENT NO. II (Continued)
SCHEDULE A (Continued)
ANNUITIES AND RISKS REINSURED
Description Policy Form Numbers Quota Share
----------- --------------------------------- -------------------------------
Category E - Individual Contracts All contracts with forms numbers [*] for contracts issued on or
with a 7 year surrender charge and VENTURE.001, VENTURE.001.94, AND before December 31, 1996. [*]
a yearly step-up death benefit. VENTURE.005. for contract issued on or after
ALL COMMISSION OPTIONS January 1, 1997.
Category F - Group Contracts with a All certificates with form number [*] for contracts issued on or
7 year surrender charge and a VENTURE.003 before December 31, 1996. [*]
yearly step-up death benefit. for contract issued on or after
ALL COMMISSION OPTIONS January 1, 1997.
PaineWebber Affiliates Tax ID Number
---------------------- -------------
PWJC Agency Inc. 51-012742
PWJC Sales Agency 00-0000000
PWJC Insurance Agency Massachusetts 00-0000000
PWJC Insurance Sales Arizona 00-0000000
PWJC Agency Illinois 00-0000000
PWJC Insurance Agency Oklahoma 00-0000000
PWJC Insurance Sales Wyoming 00-0000000
PWJC Insurance Sales Montana, Inc. 00-0000000
PW Insurance Agency of Ohio 00-0000000
PW Insurance Agency Arkansas 00-0000000
PWJC Insurance Agency Texas 00-0000000
Rotan Mosle Insurance Agency, Inc. 00-000-0000
"Net Liability", as used in this Agreement, means the Ceding Company's liability
on the annuities reinsured hereunder, less amounts recoverable from other
reinsurance.
THE MANUFACTURERS LIFE INSURANCE COMPANY OF NORTH AMERICA
REINURANCE AGREEMENT EFFECTIVE DECEMBER 31, 1994
AMENDMENT II EFFECTIVE MARCH 15, 1999
AMENDMENT NO. II (CONTINUED)
SCHEDULE D
COMMISSION SCHEDULES
TYPE OF CONTRACT COMMISSION
---------------- ----------------------------------------------------
VENTURE: Option A (formerly Option NT): (No Trail)
(Forms beginning with - Commission is a percentage of purchase
207, Venture.001, payments received.
Venture.002, Venture.003,
Venture.005) Issue Age* Commission Percentage
---------- ---------------------
00-80 [*]
81-85 [*]
Option B (formerly Option T): (Trail)
Option A, B or C may - Commission is a percentage of purchase
be elected on a policy payments received.
by policy basis. After
issuance the election Issue Age* Commission Percentage
is irrevocable. If no ---------- ---------------------
election is indicated, an 00-80 [*]
irrevocable election of 81-85 [*]
Option A will be made
by Manulife North - [*] annual trail contract years 2 through 7;
America.
- Paid on calendar quarters based on actual
account value at calendar quarter end.
- Accrues commence 18 months following any
payment.
- Accrues commence on FIXED account values
following 5th contract anniversary.
- [*] annual trail on account values in contract
years 8+;
- For forms beginning with 207, [*] annual
trail on account values begins in contract
year 7.
- Not applicable to contracts issued prior to
September 3, 1996 ([*] annual trail on
both variable and fixed account values
continues to apply in contract years 7+).
Option C: (Level Trail)
- Commission is a percentage of purchase payments
received.
Issue Age* Commission Percentage
---------- ---------------------
00-80 [*]
81-85 [*]
- [*] annual trail on variable accounts, [*]
annual trail on fixed accounts.
* Age of oldest owner (oldest annuitant in the case of forms beginning
207-VFA) on the issue date.
THE MANUFACTURERS LIFE INSURANCE COMPANY OF NORTH AMERICA
REINSURANCE AGREEMENT EFFECTIVE DECEMBER 31, 1994
AMENDMENT II EFFECTIVE MARCH 15, 1999
AMENDMENT NO. III
To the Reinsurance Agreement
Between
The Manufacturers Life Insurance Company of North America
And
PAINEWEBBER LIFE INSURANCE COMPANY
WHEREAS, the The Manufacturers Life Insurance Company of North America intends
to merge with or assign its policies to its affiliate. The Manufacturers Life
Insurance Company(U.S.A.) ("ManUSA");
NOW THEREFORE, in consideration of the mutual agreements, promises and covenants
provided herein, the parties agree as follows:
Expect as hereinafter specified, all terms and conditions of the Reinsurance
Agreement effective the 31st day of December, 1994, amendments and addenda
attached thereto, shall apply, and this Amendment is to be attached to and made
a part of the afforesaid Agreement.
All references to "The Manufacturers Life Insurance Company of North America"
or "the Ceding Company" shall be changed to or shall refer to ManUSA.
This Amendment shall be effective January 1, 2002.
IN WITNESS WHEREOF, the Manufacturers Life Insurance Company of North America
and PaineWebber have caused their names to be subscribed and duly attested
hereunder by their respective Authorized Officers.
The Manufacturers Life Insurance Company of North America
By: /s/ illegible Attest: /s/ illegible
--------------------------------- --------------------------------
Title: illegible Title: illegible
Date: 11-8-2001 Date: 11-8-2001
THE MANUFACTURERS LIFE INSURANCE PAINEWEBBER LIFE
COMPANY OF NORTH AMERICA INSURANCE COMPANY
EFFECTIVE DECEMBER 31, 1994 PREPARED 10/18/01
AMENDMENT III EFFECTIVE JANUARY 1, 2002
PAINEWEBBER LIFE INSURANCE COMPANY
By: /s/ illegible Attest: /s/ illegible
--------------------------------- --------------------------------
Title: PRESIDENT Title: SENIOR VICE PRESIDENT
Date: 11/13/01 Date: 11/13/01
THE MANUFACTURERS LIFE INSURANCE PAINEWEBBER LIFE
COMPANY OF NORTH AMERICA INSURANCE COMPANY
EFFECTIVE DECEMBER 31, 1994 PREPARED 10/18/01
AMENDMENT III EFFECTIVE JANUARY 1, 2002
AMENDMENT NO. IV
To the Reinsurance Agreement
Between
The Manufacturers Life Insurance Company of North America
And
PAINEWEBBER LIFE INSURANCE COMPANY
Except as hereinafter specified, all terms and conditions of the Reinsurance
Agreement effective the 31st day of December, 1994, amendments and addenda
attached thereto, shall apply, and this Amendment is to be attached to and made
a part of the aforesaid Agreement.
The parties agree as follows:
The Reinsurance Agreement shall terminate for all new business effective at
midnight on December 31, 2001.
The Manufacturers Life Insurance Company of North America shall no longer cede
and PaineWebber will no longer accept reinsurance under this Agreement.
Reinsurance in force hereunder will continue to be governed by the terms and
conditions of the Agreement until the termination or expiry of each reinsurance
cession.
This Amendment shall be effective December 31, 2001.
IN WITNESS WHEREOF, the The Manufacturers Life Insurance Company of North
America and PaineWebber have caused their names to be subscribed and duly
attested hereunder by their respective Authorized Officers.
The Manufacturers Life Insurance Company of North America
By: illegible Attest: illegible
--------------------------------- --------------------------------
Title: illegible Title: illegible
Date: 11/30/2001 Date: 11-30-2001
THE MANUFACTURERS LIFE INSURANCE PAINEWEBBER LIFE
COMPANY OF NORTH AMERICA INSURANCE COMPANY
EFFECIVE DECEMBER 31, 1994 PREPARED 11/30/01
AMENDMENT IV EFFECTIVE DECEMBER 31, 2001
PAINEWEBBER LIFE INSURANCE COMPANY
By: illegible Attest: illegible
--------------------------------- --------------------------------
Title: President Title: SENIOR VICE PRESIDENT
Date: 1/22/02 Date: illegible
THE MANUFACTURERS LIFE INSURANCE PAINEWEBBER LIFE
COMPANY OF NORTH AMERICA INSURANCE COMPANY
EFFECTIVE DECEMBER 31, 1994 Prepared 11/30/01
AMENDMENT IV EFFECTIVE DECEMBER 31, 2001
