NET WORTH MAINTENANCE AGREEMENT
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This agreement ("Agreement"), made and entered into as of the 31st day of
December, 2002, (the "Effective Date"), by and between MetLife, Inc.
("MetLife"), a Delaware Corporation, and First MetLife Investors Insurance
Company ("Beneficiary"), a stock life insurance company domiciled in the State
of New York. "
INTRODUCTION
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MetLife directly or indirectly owns 100% of the outstanding common stock of
Beneficiary;
Beneficiary is a company with operations that are distinct and separate from
those of MetLife, but its operations are integral to MetLife's strategic
direction;
MetLife and Beneficiary recognize the importance in a competitive insurance
industry of obtaining the highest possible ratings for financial strength; and
MetLife and Beneficiary desire to take certain actions to enhance and maintain
the financial strength of Beneficiary.
In consideration of the mutual promises herein contained, the parties hereto
agree as follows:
1. CAPITAL AND SURPLUS. MetLife agrees that it shall cause Beneficiary to have
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at all times during the term of this Agreement the greater of:
(a) A capital and surplus of $10 million; or
(b) the amount of capita] and surplus as shall be necessary to maintain a
total adjusted capital of Beneficiary at a level not less than 150% of the
company action level RBC of Beneficiary.
For purposes of this Paragraph 1, "total adjusted capital" and "company
action level RBC" shall be as defined in the Risk-Based Capital (RBC) for
Insurers Model Act adopted by the National Association of Insurance
Commissioners."
2. LIQUIDITY. During the term of this Agreement, MetLife shall cause
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Beneficiary to have the liquidity necessary to enable it to meet its
current obligations on a timely basis; provided, however, that such
liquidity shall be provided in accordance with, and only to the extent
permitted by, applicable law.
3. WAIVERS. MetLife hereby waives any failure or delay on the part of
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Beneficiary (but not of any other person or entity) in asserting or
enforcing any of its rights or in making any claims or demands hereunder.
4. TERM AND TERMINATION. Unless earlier terminated in accordance with this
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paragraph 4, this Agreement shall continue indefinitely. MetLife shall have
the absolute right to terminate this Agreement upon thirty (30) days' prior
written notice to Beneficiary, provided, however, that MetLife agrees not
to terminate this Agreement unless Beneficiary attains a stand-alone rating
from Standard & Poor's Corp, ("S&P"), without giving weight to the support
of this Agreement, that is the same as or better than its rating from such
agency with such support, or MetLife sells Beneficiary or Beneficiary's
entire block of business to an acquirer (i) having a rating from S&P that
is at least equal to the lower of (a) MetLife's then current rating from
such agency or (b) Beneficiary's then current rating as supported by this
Agreement from such agency; or (ii) such that, after giving effect to the
sale, Beneficiary attains a rating from S&P that is the same as or better
than its then current rating from such agency as supported by this
Agreement Notwithstanding the foregoing, this Agreement will terminate
automatically one year after the closing of a sale of Beneficiary by
MetLife, and all provisions hereof will be of no further force and effect.
5. RIGHT TO ENFORCE. Any creditor of Beneficiary (including, but not limited
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to, its employees, policyholders and trade creditors) shall have the right
to enforce the provisions of this Agreement through the Superintendent of
Insurance, New York Insurance Department or the state insurance regulator
of such creditor's state of residence if Beneficiary defaults on any claim
or other payment owed to such creditor when due, and such insurance
regulator may, at the request of such creditor made in accordance with and
subject to the conditions of this Agreement, proceed directly against
MetLife to enforce the provisions of this Agreement during its term;
provided, however, that no creditor of Beneficiary may take any action
authorized under this paragraph 5 unless and until (a) such creditor has
given MetLife written notice of its intent to enforce the terms of this
Agreement as provided in this paragraph 5, which notice shall specify in
reasonable detail the nature of and basis for the creditor's complaint and
(b) MetLife has failed to comply with this Agreement within sixty (60) days
after such notice is given.
6. NOT A GUARANTEE. This Agreement is not, and nothing herein contained and
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nothing done pursuant hereto by MetLife shall constitute or be construed or
deemed to constitute, an evidence of indebtedness or an obligation or
liability of MetLife as guarantor, endorser, surety or otherwise in respect
of any obligation, indebtedness or liability, of any kind whatsoever, of
Beneficiary. This Agreement does not provide, and is not intended to be
construed or deemed to provide, any creditor of Beneficiary with recourse
to or against any of the assets of MetLife.
7. APPLICABLE LAW AND FORUM. This Agreement shall be governed by and construed
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in accordance with the laws of the State of New York, without giving effect
to the principles of conflicts of laws.
8. ASSIGNMENT. This Agreement shall be binding upon and enforceable against
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successors and permitted assigns. Neither party hereto shall assign this
Agreement or any rights or obligations hereunder, and no other person or
entity entitled to take any action under this Agreement shall assign the
right to take such action, without the prior written consent of the
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parties hereto (other than the party proposing to make such assignment),
and any such attempted assignment without prior written consent shall be
void and of no force or effect.
9. COMMUNICATIONS. All notices, requests, demands and other communications
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under this Agreement (whether from MetLife, Beneficiary, or any other
person or entity) shall be in writing and shall be deemed to have been
duly given: (a) on the date of service if served personally on the party to
which such notice is to be given; (b) on the date of transmission if sent
via facsimile transmission to the facsimile number given below, and
telephonic confirmation of transmission is obtained promptly after
completion of transmission; (c) on the business day after delivery to
Federal Express or similar overnight carrier or the Express Mail Service
maintained by the United States Postal Service; or (d) on the fifth
calendar day after mailing, if mailed to the party to which such notice is
to be given, by first class mail, registered or certified, postage prepaid
and properly addressed, to the party as follows:
If to MetLife to:
Xxxxxxx X. Xxxxxx
Vice-Chairman of the Board
And Chief Financial Officer
MetLife, Inc.
Xxx Xxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Facsimile No. (000)000-0000
Copy to: Xxxx X. Xxxxxx, Esq.
Senior Executive Vice-President and General Counsel
Facsimile No. (000) 000-0000
If to Beneficiary:
First MetLife Investors Insurance Company
00 Xxxxxxxxx Xxxxx Xxxxx
Xxxxxxx Xxxxx, XX 00000
Attn: Controller
Any party hereto may change its address or facsimile number for the purpose
of this paragraph 9 by giving the other party notice of its new address in
the manner set forth above.
10. PUBLICITY. No party hereto may, directly or indirectly, disclose the
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existence of this Agreement or the terms hereof, other than to any
regulatory agency or rating agency, except with the permission of the other
party hereto and then only as permitted by law. MetLife may make such
disclosures as are required by federal or state securities laws, without
prior notice to, or consent of the Beneficiary.
11. SEVERABILITY. If any provision of this Agreement shall be declared null,
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void or
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unenforceable in whole or in part by any court, arbitrator or governmental
agency, said provision shall survive to the extent it is not so declared
and all the other provisions of this Agreement shall remain in full force
and effect unless, in each case, such declaration shall serve to deprive
any of the parties hereto of the fundamental benefits of or rights under
this Agreement.
12. ENTIRE AGREEMENT. This Agreement constitutes the entire agreement between
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the parties hereto with respect to the subject matter hereof and supersedes
all prior and contemporaneous agreements, understandings, negotiations and
discussion, whether oral or written, of the parties.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
by their respective duly authorized representatives as of the day and year above
written.
METLIFE, INC. FIRST METLIFE INVESTORS
INSURANCE COMPANY
By: /s/ illegible By: /s/ Xxxxxxx X. Xxxxxxx
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Title: Title: Executive Vice President
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