EXECUTION VERSION
AMENDED AND RESTATED
INDEMNITY
RETROCESSION AGREEMENT
COVERAGE EFFECTIVE AS OF OCTOBER 1, 2005
BETWEEN
METLIFE INSURANCE COMPANY USA
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REFERRED TO AS THE "COMPANY"
AND
CATALYST RE LTD.
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REFERRED TO AS THE "REINSURER"
TABLE OF CONTENTS
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PAGE
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ARTICLE I. DEFINITIONS................................ 2
ARTICLE II. REINSURANCE COVERAGE....................... 6
ARTICLE III. GENERAL PROVISIONS......................... 7
ARTICLE IV. REINSURANCE PREMIUMS....................... 9
ARTICLE V. BENEFIT ALLOWANCES......................... 10
ARTICLE VI. RECAPTURE.................................. 10
ARTICLE VII. ACCOUNTING AND SETTLEMENTS................. 10
ARTICLE VIII. DURATION................................... 12
ARTICLE IX. COLLATERAL ACCOUNT......................... 13
ARTICLE X. TERMINAL ACCOUNTING AND SETTLEMENT......... 13
ARTICLE XI. DISPUTE RESOLUTION......................... 14
ARTICLE XII. INSOLVENCY................................. 16
ARTICLE XIII. REPRESENTATIONS, WARRANTIES AND COVENANTS
OF THE COMPANY............................. 17
ARTICLE XIV. REPRESENTATIONS, WARRANTIES AND COVENANTS
OF THE REINSURER........................... 21
ARTICLE XV. DAC TAX.................................... 23
ARTICLE XVI. MISCELLANEOUS.............................. 26
ARTICLE XVII. EXECUTION.................................. 30
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AMENDED AND RESTATED INDEMNITY RETROCESSION AGREEMENT
This Amended and Restated Indemnity Retrocession Agreement (this
"Agreement") is made and entered into by and between MetLife Insurance Company
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USA, an insurer domiciled in the State of Delaware (the "Company"), and Catalyst
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Re Ltd., a reinsurer domiciled in the Islands of Bermuda (the "Reinsurer"), with
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coverage effective as of October 1, 2005. Each of the Company and the Reinsurer
are referred to herein from time to time as a "party" and collectively as the
"parties." -----
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WHEREAS, on December 28, 2005, the Reinsurer and Exeter Reassurance
Company, Ltd. ("Exeter") entered into that certain Indemnity Retrocession
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Agreement, effective as of October 1, 2005 (as amended, the "Indemnity
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Retrocession Agreement"), pursuant to which the Reinsurer reinsures Exeter for
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certain risks associated with variable annuity contracts, I.E., the Reinsured
Contracts (as defined below) reinsured from MetLife Investors USA Insurance
Company ("MICUSA") and MetLife Investors Insurance Company ("MIIC") and other
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MetLife affiliates;
WHEREAS, in connection with an internal restructuring, as of November 14,
2014, MetLife Insurance Company of Connecticut has been redomiciled from
Connecticut to Delaware and renamed MetLife Insurance Company USA, and
immediately following this redomestication and name change, each of MICUSA, MIIC
and Exeter have merged with and into the Company, with the Company surviving the
merger (the "Mergers");
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WHEREAS, as a result of Mergers, the Company, as successor to MICUSA, MIIC
and Exeter, is no longer ceding or reinsuring the Reinsured Contracts issued by
MICUSA or MIIC, I.E., the Direct Contracts (as defined below), since these
Direct Contracts are direct policy obligations of the merged company;
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WHEREAS, following the Mergers, the Company, as successor to Exeter, and
the Reinsurer wish to continue the reinsurance arrangement created by the
Indemnity Retrocession Agreement, as amended and restated pursuant to this
Agreement, such that certain of the Reinsured Risks formerly retroceded to the
Reinsurer pursuant to the Indemnity Retrocession Agreement will be directly
ceded from the Company to the Reinsurer pursuant to this Agreement; and
WHEREAS, the Company and the Reinsurer mutually agree to reinsure on the
terms and conditions set forth herein;
WHEREAS, this Agreement is an indemnity retrocession and reinsurance
agreement solely between the Company and the Reinsurer, and performance of the
obligations of each party under this Agreement will be rendered solely to the
other party;
WHEREAS, except as set forth in Article XII, in no instance will anyone
other than the Company or the Reinsurer have any rights under this Agreement;
and
WHEREAS, the Reinsurer shall not have any liability with respect to any
contract owner, contract issuer, annuitant or beneficiary under any Reinsured
Contract.
NOW, THEREFORE, in consideration of mutual covenants contained in this
Agreement and other good and valuable consideration (the receipt and sufficiency
of which are hereby acknowledged), the parties agree as follows:
ARTICLE I.
DEFINITIONS
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As used in this Agreement, the following terms shall have the following
meanings (definitions are applicable to both the singular and the plural forms
of each term defined in this Article):
"Accounting Period" shall have the meaning specified in Article VII,
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Section 1.
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"Account Value" shall mean, as to each Reinsured Contract, the policy
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value, including all separate and fixed account assets, included in determining
the amounts actually paid upon death under such Reinsured Contract.
"Assumed Contracts" means those individual variable annuity contracts
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issued by MetLife between April 9, 2001 and September 30, 2005 having the plan
codes and issue dates listed on Schedule D and in-force as of the Coverage
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Effective Date, and reinsured by the Company pursuant to the Reinsurance
Agreements.
"Bank" shall mean Societe Generale, a French corporation.
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"Benefit Allowance" shall have the meaning specified in Appendix A.
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"Business Day" means any day that is not a Saturday or a Sunday or a day on
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which banks in the State of New York are authorized or required by law to close.
"Cash Collateral Pledge Agreement" means that certain Cash Collateral
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Pledge Agreement, dated as of December 28, 2005, by and among the Reinsurer, the
Bank and the Company (as successor to Exeter).
"Company SAP Statements" means the annual financial statements filed by the
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Company with the Delaware Department of Insurance, based on the accounting
principles permitted or prescribed under Delaware insurance law.
"Coverage Effective Date" is October 1, 2005.
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"Direct Contracts" means those individual variable annuity contracts issued
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by the Company (or any predecessor of the Company) between April 9, 2001 and
September 30, 2005 having the plan codes and issue dates listed on Schedule D
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and in-force as of the Coverage Effective Date.
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"Economic Loss (or Gain)" shall mean, at any point in time, an amount equal
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to (i) any Reinsurance Premium or other amounts due the Reinsurer pursuant to
this Agreement and unpaid as of the Termination Date less (ii) any Reinsured
Claims or other amounts due the Company pursuant to this Agreement and unpaid as
of the Termination Date, plus (iii) the total of all payments the Reinsurer
makes or would have to make or receive in order to unwind all of its hedging and
financing positions related to this Agreement, including but not limited to OTC
derivatives, exchange traded derivatives, and borrowings. For transactions with
counterparties that are not affiliated with the Reinsurer, including all
transactions conducted on an exchange, the payment amount included in the
calculation of Economic Loss will be the actual payment that the Reinsurer makes
or receives or would have to make or receive. For affiliate transactions, the
amount included in the calculation will be the fair market bid or offer value as
applicable, depending on whether Reinsurer is selling or buying or would be
selling or buying.
"Extracontractual Damages" means all liabilities for any and all costs,
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expenses, damages, liabilities or obligations of any kind or nature (including
without limitation attorneys fees, consequential and incidental damages, and
punitive and exemplary damages) which are incurred by MetLife or the Company or
any related entity or any of their respective representatives arising out of,
resulting from, or relating to, any alleged or actual act or omission, whether
or not in bad faith, intentional, willful, negligent, reckless, careless or
otherwise, of MetLife or the Company in connection with a Reinsured Contract or,
in the case of an Assumed Contract, a Reinsurance Agreement, and which are not
contractually covered by the terms and conditions of such Reinsured Contract or,
in the case of an Assumed Contract, such Reinsurance Agreement, whether or not
such acts or omissions occurred before or after the Coverage Effective Date.
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"Governmental Authority" means any national, federal, state, local or other
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court, arbitrator, administrative agency, commission or division, insurance or
securities regulatory or self-regulatory body or securities or commodities
exchange, including, but not limited to, the Delaware Department of Insurance.
"Guaranteed Minimum Death Benefits (GMDB)" means the actual total amounts
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paid by MetLife or the Company under the Reinsured Contracts upon death of an
owner or annuitant thereunder, including the waiver of surrender charges.
"Keepwell Agreement" means the Keepwell Agreement dated November 4, 2005
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entered into between the Bank and the Reinsurer.
"MetLife" means each company which issued variable annuity contracts that
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are reinsured by the Company pursuant to the Reinsurance Agreements.
"Net Amount Due" shall have the meaning specified in Article VII,
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Section 3.
"Periodic Settlements Report" means a settlement report substantially in
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the form of Schedule A.
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"Premium Payment Period" means the period commencing on the Coverage
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Effective Date and ending on September 30, 2020.
"Proxy Total Account Value" shall have the meaning specified in Appendix A.
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"Reinsurance Accounting Report" means an accounting report substantially in
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the form of Schedule B.
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"Reinsurance Agreements" means those reinsurance agreements listed on
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Schedule C pursuant to which the Company reinsures the GMDB liability of MetLife
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under the Assumed Contracts.
"Reinsurance Premiums" shall have the meaning specified in Article IV.
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"Reinsured Claims" means, with respect to any Accounting Period, the lesser
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of (i) the amount otherwise due the Company from the Reinsurer with regards to
the Reinsured Risks and (ii) the Benefit Allowance applicable to such Accounting
Period.
"Reinsured Contracts" means the Assumed Contracts and the Direct Contracts.
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"Reinsured Risks" means GMDB amounts payable by MetLife or the Company on
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the death of the owner, annuitant or continuing spouse, as applicable, under
Reinsured Contracts in excess of the applicable Account Values (without regard
to any "top up" pursuant to a spousal continuation benefit), net of Third Party
Reinsurance, and limited in all events to (i) death benefits payable under
contract provisions, endorsements or riders providing for an annual step-up
death benefit based on anniversary date values, plus applicable waiver of
surrender charges, and, with respect to the Assumed Contracts, to the extent
that such risks are reinsured by the Company pursuant to the Reinsurance
Agreements, and (ii) in respect of the Direct Contracts, the risks under the
Direct Contracts that were previously reinsured by Exeter under the Indemnity
Retrocession Agreement prior to the Mergers.
"Terminal Accounting and Settlement" shall have the meaning specified in
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Article X, Section 1.
"Termination Date" shall have the meaning specified in Article VIII,
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Section 2.
"Third Party Reinsurance" means reinsurance ceded by the Company with
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regards to the GMDB risks assumed by the Company pursuant to the Reinsurance
Agreements, other than pursuant to this Agreement, whether or not collectible.
ARTICLE II.
REINSURANCE COVERAGE
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1. Risks Reinsured. Commencing on the Coverage Effective Date, the
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Reinsurer agrees to assume from the Company, and the Company agrees to cede or
retrocede, as the case
6
may be, to the Reinsurer, subject to the terms and conditions hereof and
limitations set forth herein, the Reinsured Risks.
2. Form of Reinsurance. The reinsurance hereunder is indemnity reinsurance,
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net of the Third Party Reinsurance.
3. Coverages and Exclusions. Only Reinsured Risks are reinsured under this
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Agreement, and the Reinsurer accepts no liability for any liabilities of the
Company, including, without limitation, liabilities for annuitization, cash
surrenders, dividends, or any riders providing additional or supplemental
benefits arising under or in connection with the Reinsured Contracts other than
the Reinsured Risks and, with respect to the Direct Contracts, liabilities that
would not have been reinsured by the Reinsurer under the Indemnity Retrocession
Agreement prior to the Mergers. With respect to the Assumed Contracts, the
reinsurance hereunder is subject to the same limitations and conditions
specified in the Reinsurance Agreements.
4. No Extracontractual Damages. The Reinsurer does not indemnify the
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Company for, and will not be liable for, any Extracontractual Damages.
5. Expenses. The Reinsurer will bear no part of the expenses incurred in
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connection with the Reinsured Contracts.
6. Taxes and Assessments. The Reinsurer will not reimburse the Company for
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any taxes or guaranty fund or similar assessments paid by the Company.
ARTICLE III.
GENERAL PROVISIONS
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1. Administration. All of the usual and customary servicing and
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administrative functions and duties ("Administration") associated with the
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Reinsured Contracts and the Reinsurance Agreements shall continue to be the
responsibility of the Company. The Company agrees that (i) it will continue to
perform such Administration in accordance with its standards in
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effect prior to the Coverage Effective Date, (ii) it will promptly notify the
Reinsurer if it is unable to provide any of the reports, records, documents,
instruments, files or other information necessary or required to perform
Administration of the Reinsured Contracts and the Reinsurance Agreements, (iii)
it will not agree to any amendment to any of the GMDB benefit provisions of any
of the Reinsured Contracts or Reinsurance Agreements, or, with respect to the
Reinsurance Agreements, exercise any discretionary rights with respect to such
provisions where such exercise would increase the risk assumed by the Reinsurer
hereunder, in each case without the consent of the Reinsurer, and (iv) it will
not terminate any of the Reinsurance Agreements. The Company agrees to promptly
notify the Reinsurer of any amendment to any of the Reinsurance Agreements that
did not require the consent of the Reinsurer.
2. Audit and Inspection. At any reasonable time, either party may inspect,
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during normal business hours, at the principal office of the other, the original
papers and any and all other books or documents relating to or affecting
reinsurance under this Agreement. Information obtained through any inspection
pursuant to this Paragraph will not be used for any purpose not relating to
reinsurance hereunder.
3. Misunderstandings and Oversights. If any failure to pay amounts due or
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to perform any other act required by this Agreement is unintentional and caused
by misunderstanding or oversight, the Company and the Reinsurer will adjust the
situation to what it would have been had the misunderstanding or oversight not
occurred. The first party discovering such misunderstanding or oversight, or an
act resulting from such misunderstanding or oversight, will notify the other
party in writing promptly upon discovery thereof, and the parties shall act to
correct such misunderstanding or oversight within twenty (20) Business Days
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of such other party's receipt of such notice. However, this section shall not be
construed as a waiver by either party of its rights to enforce strictly the
terms of this Agreement.
4. Third Party Reinsurance. Set forth on Schedule F is a description of all
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existing Third Party Reinsurance. The Company agrees that it may not enter into
any new agreements involving the GMDB benefits under the Reinsured Contracts
without the prior written consent of the Reinsurer.
5. Retrocession. The Reinsurer may retrocede all or a portion of the
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Reinsured Risks. The Reinsurer shall provide prompt notice to the Company of any
such retrocession made by the Reinsurer.
6. Setoff and Recoupment. Any debts or credits, matured or unmatured,
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liquidated or unliquidated, regardless of when they arose or were incurred, in
favor of or against either the Company or the Reinsurer with respect to this
Agreement are deemed mutual debts or credits, as the case may be, and shall be
setoff from any amounts due to the Company or the Reinsurer hereunder, as the
case may be, and only the net balance shall be allowed or paid. This setoff
provision (to the extent permitted by law) shall not be modified or reconstrued
due to the insolvency, liquidation, rehabilitation, conservatorship, or
receivership of either party.
ARTICLE IV.
REINSURANCE PREMIUMS
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In consideration of the reinsurance provided hereunder, the Company shall
pay to the Reinsurer reinsurance premiums for each Accounting Period during the
Premium Payment Period equal to 15.0 basis points times the Proxy Total Account
Value, in accordance with the calculation set forth in Appendix A (the
"Reinsurance Premium"). Premium payments shall be made as specified in Paragraph
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3 of Article VII of this Agreement.
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ARTICLE V.
BENEFIT ALLOWANCES
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The amount payable by the Reinsurer to the Company under this Agreement for
any Accounting Period shall not exceed the Benefit Allowance as of the end of
such Accounting Period.
ARTICLE VI.
RECAPTURE
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At the request of the Company, the Reinsurer will offer a recapture payment
amount at which the Company may recapture the Reinsured Risks within thirty (30)
days after receipt of such offer by the Company, such amount to equal the
Reinsurer's Economic Loss or Gain as of the Business Day prior to the date such
offer is made. Such request can be made by the Company up to four (4) times each
Accounting Period. The decision to recapture shall be made at the sole
discretion of the Company. The recapture payment amount will be subject to a
final adjustment to reflect changes between the date of the offer and the
recapture date.
ARTICLE VII.
ACCOUNTING AND SETTLEMENTS
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1. Accounting Period. The Accounting Periods under this Agreement will be
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each consecutive 12-month period beginning on the Coverage Effective Date,
PROVIDED THAT the final Accounting Period shall be the period commencing on the
applicable anniversary of the Coverage Effective Date and ending on the
Termination Date.
2. Reinsurance Accounting Reports. Within ten (10) Business Days of the end
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of each Accounting Period, the Company shall provide a Reinsurance Accounting
Report to the Reinsurer setting forth the Reinsured Risks for such period.
3. Periodic Settlements. Within twelve (12) Business Days after the end of
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each Accounting Period, the Reinsurer shall provide a Periodic Settlement Report
to the Company
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setting out the Reinsurance Premium, the Reinsured Claims and the Net Amount Due
for such period. The Net Amount Due will equal the Reinsurance Premium less
Reinsured Claims. Within fifteen (15) Business Days of the end of each
Accounting Period, the Company shall remit the Net Amount Due to the Reinsurer,
if such amount is positive. If the Net Amount Due is negative, then the
Reinsurer shall, within fifteen (15) Business Days of the end of each Accounting
Period, remit to the Company the absolute value of such amount. During any
periods after payment becomes due, interest shall accrue at a rate equal to
LIBOR plus 3.75% per annum for the period from the due date through and
including the actual payment date.
If no Reinsurance Accounting Report is provided by the Company to the
Reinsurer within ten (10) Business Days after the end of the Accounting Period,
the Reinsurer shall, nevertheless, provide a report to the Company within twelve
(12) Business Days after the end of the Accounting Period setting out the
Reinsurance Premium owed by the Company and such amount shall be payable by the
Company in accordance with the provisions of Paragraph 3 of this Article VII.
4. Payments. All payments made pursuant to this Agreement shall be made by
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wire transfer of immediately available non-reversible United States Federal
Funds to such bank account or accounts as designated by the recipient. All
payments should be made free and clear and net of any deductions or
withholdings.
5. Estimations. If the amounts due hereunder cannot be determined at such
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dates as defined in Paragraph 3 above, on an exact basis, such payments will be
based on reasonable estimations of actual payments. Adjustments will then be
made to reflect actual amounts due as soon as possible.
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ARTICLE VIII.
DURATION
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1. Duration. This Agreement covers Reinsured Risks paid by the Company
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during the period beginning on the Coverage Effective Date and ending on the
Termination Date.
2. Reinsurer's Liability. The liability of the Reinsurer with respect to
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reinsurance provided hereunder will begin simultaneously with that of the
Company under the Direct Contracts and, in the case of the Assumed Contracts,
under the Reinsurance Agreements, but not prior to the Coverage Effective Date
of this Agreement. The Reinsurer's liability with respect to the Reinsured Risks
will terminate on the earliest of: (i) the date when all liabilities of the
Company under the Reinsured Contracts and the Reinsurance Agreements terminate
and all amounts due the Company from the Reinsurer are settled, (ii) the
effective date of any recapture of the Reinsured Risks by the Company in
accordance with Article VI, (iii) the effective date of any termination of this
Agreement in accordance with paragraph (3) below, or (iv) the twenty fifth
(25th) anniversary of the Coverage Effective Date (the earliest of (i), (ii),
(iii) or (iv) being the "Termination Date").
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3. Termination for Nonpayment of Reinsurance Premiums or Other Amounts Due.
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If the Company fails to pay the Reinsurance Premiums or any other amounts due to
the Reinsurer pursuant to this Agreement, within twenty (20) Business Days after
the end of any Accounting Period the Reinsurer may terminate this Agreement,
subject to ten (10) Business Days prior written notice to the Company, in which
event the provisions of Article X, Paragraph 3 shall become applicable. If the
Reinsurer fails to pay any amounts due to the Company pursuant to this Agreement
within twenty (20) Business Days after the receipt of the Reinsurance Accounting
Report, the Company may terminate this Agreement, subject to ten (10) Business
Days prior written notice to the Reinsurer.
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ARTICLE IX.
COLLATERAL ACCOUNT
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On December 28, 2005, the Company entered into the Cash Collateral Pledge
Agreement with the "Bank" and established a deposit account pursuant thereto
(the "Collateral Account") for the benefit of the Reinsurer. The Company has, on
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December 28, 2005, deposited the sum of $25 million to the Collateral Account.
The Collateral Account shall be held as collateral security for the payment to
the Reinsurer of amounts due the Reinsurer under the terms of this Agreement,
shall remain in full force and effect until payment in full in cash of such
amounts, and shall be released to the Company and/or the Reinsurer in accordance
with the terms of the Cash Collateral Pledge Agreement.
ARTICLE X.
TERMINAL ACCOUNTING AND SETTLEMENT
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1. Terminal Accounting. In the event that this Agreement is terminated in
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accordance with Article VIII, Paragraph 3, or the liability of the Reinsurer
with respect to reinsurance hereunder is otherwise terminated in accordance with
Article VIII, Paragraph 2, a "Terminal Accounting and Settlement" will take
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place.
2. Terminal Accounting Date. The Terminal Accounting and Settlement shall
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occur within ten (10) Business Days following the Termination Date.
3. Settlement. The Terminal Accounting and Settlement will be calculated by
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the parties, as applicable, and will consist of the following:
(i) In the event this Agreement is terminated pursuant to Article
VIII, Paragraph 2 (i) (termination of all liabilities) prior to the twenty
fifth (25th) anniversary of the Coverage Effective Date or pursuant to
Article VIII, Paragraph 2 (iv) (twenty-fifth anniversary), a settlement as
provided in Article VII, Paragraph 3, computed as of the Termination Date;
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(ii) in the event that this Agreement is terminated pursuant to
Article VIII, Paragraph 2 (ii) (recapture), payment by the Company to the
Reinsurer or a payment by the Reinsurer to the Company as appropriate of an
amount determined in accordance with Article VI; and
(iii) in the event the Agreement is terminated pursuant to Article
VIII, Paragraph 3 (nonpayment of premium), payment by the Company to the
Reinsurer of an amount equal to the Economic Loss to the Reinsurer
resulting from such termination, or payment by the Reinsurer to the Company
of an amount equal to the Economic Gain to the Reinsurer resulting from
such termination. In such event, all calculations of Economic Loss (or
Gain) will be made in good faith by the Reinsurer and shall be binding on
the Company.
If the calculation of the Terminal Accounting and Settlement produces an
amount owing to the Company, such amount will be paid by the Reinsurer to the
Company. If the calculation of the Terminal Accounting and Settlement produces
an amount owing to the Reinsurer, such amount will be paid by the Company to the
Reinsurer, in accordance with, the procedures for Periodic Settlements. In the
event that the Company fails to pay to the Reinsurer amounts due under this
Article X within two (2) Business Days of the completion of the Terminal
Settlement and Accounting calculation, the Reinsurer shall be entitled to deduct
the amounts due from the Collateral Account in accordance with Article IX.
ARTICLE XI.
DISPUTE RESOLUTION
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1. General. Disputes and differences between the Company and the Reinsurer
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relating to this Agreement, including the validity and effectiveness hereof, but
not including any dispute subject to Article XI, Section 3 or Article XV,
Section 5, on which an agreement cannot
14
be reached will be decided by arbitration. The arbitrators shall construe this
Agreement from the standpoint of practical and equitable principles, and the
customs and practices of the insurance and reinsurance business, rather than
from the standpoint of a purely legal document. The parties intend that the
arbitrators will make their decision with a view to effecting the intent of the
parties to this Agreement.
2. Method. Arbitration under this Article XI shall be conducted before a
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panel of three arbitrators. The arbitrators must be disinterested, neutral, and
impartial present or former officers of life insurance or reinsurance companies,
other than the parties to this Agreement or any entity affiliated with either
party, or other professionals with significant experience in the life insurance
or reinsurance business, PROVIDED THAT any such professional shall not have
provided services to either party within the preceding five (5) years. One of
the arbitrators will be appointed by the Reinsurer, another by the Company, and
the two arbitrators thus selected will select a third arbitrator before
arbitration begins. If either party fails to select an arbitrator within thirty
(30) days after the date of a written request to do so, the other party may
select an arbitrator for it. Should the two party-appointed arbitrators fail to
choose a third arbitrator within thirty (30) days of the appointment of the
second arbitrator, the parties shall appoint the third arbitrator pursuant to
the XXXXX-U.S. Umpire Selection Procedure. The decision of a majority of the
arbitration panel shall be final and binding. The arbitration panel shall render
its award in writing within forty-five days of the close of the arbitration
proceedings. Judgment upon the award may be entered in any court having
jurisdiction pursuant to the Federal Arbitration Act. 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.
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3. Legal Action. Notwithstanding any other provision of this Agreement, in
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the event that the Reinsurer terminates the Agreement as a result of the
Company's failure to pay any amounts due under the Agreement, the Reinsurer
specifically retains the right to bring legal action to recover unpaid amounts,
plus actual and consequential damages, including, without limitation, any losses
resulting from hedging positions entered into in connection with the Agreement.
ARTICLE XII.
INSOLVENCY
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Insolvency. In the event of the insolvency of the Company, any payments due
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to the Company from the Reinsurer pursuant to the terms of this Agreement will
be made directly to the Company or its liquidator, receiver or statutory
successor. The reinsurance will be payable by the Reinsurer in accordance with
the terms of this Agreement without diminution because of such insolvency of the
Company. The liquidator, receiver or statutory successor of the Company will
give the Reinsurer written notice of the pendency of a claim against the Company
on the Reinsured Contracts or the Reinsurance Agreements 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
Company's name (or in the name of the Company's 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 Company or
its liquidator, receiver or statutory successor. The expense thus incurred by
the Reinsurer will be chargeable, subject to court approval, against the Company
as a part of the expense of liquidation to 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 Reinsurer.
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ARTICLE XIII.
REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE COMPANY
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The Company represents, warrants and covenants as follows:
1. Organization, Standing and Authority of the Company. The Company is an
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insurance company duly organized, validly existing and in good standing as a
corporation under the laws of the State of Delaware and has all requisite
corporate power and authority to carry on the operations of its business as they
are now being conducted. The Company (or the applicable predecessor to the
Company) held all requisite licenses or certificates of authority required to
issue the Direct Contracts when such Direct Contracts were issued. The Company
holds all requisite licenses or certificates of authority required to reinsure
the Assumed Contracts.
2. Authorization. The Company has all requisite corporate power and
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authority to enter into this Agreement and to perform its obligations hereunder.
The execution and delivery by the Company of this Agreement, and the performance
by the Company of its obligations under this Agreement, have been duly
authorized by all necessary corporate action. This Agreement, when duly executed
and delivered by the Company, subject to the due execution and delivery by the
Reinsurer, will be a valid and binding obligation of the Company, enforceable
against the Company in accordance with its terms.
3. No Conflict or Violation. The execution, delivery and performance of
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this Agreement and the consummation of the transactions contemplated hereby in
accordance with the respective terms and conditions hereof will not (a) violate
any provision of the Certificate of Incorporation or Bye-laws of the Company, or
(b) violate any order, judgment, injunction, award or decree of any court,
arbitrator or governmental or regulatory body against, or binding upon, or any
agreement with, or condition imposed by, any governmental or regulatory body,
foreign or domestic, binding upon the Company.
17
4. Intermediaries and Financial Advisors. No reinsurance intermediary or
-------------------------------------
broker or other advisor has acted directly or indirectly as such for, or is
entitled to any compensation from, the Company in connection with this
Agreement.
5. Reliance. It is expressly understood and agreed that neither the
--------
Reinsurer nor any of its affiliates is undertaking to provide the Company or any
of its affiliates with any advice relating to investment, legal, regulatory,
accounting or tax matters. In furtherance thereof, the Company acknowledges and
agrees that (a) it and its affiliates have relied and will continue to rely on
the advice of its and their own investment, legal, regulatory, tax and
accounting advisors for all matters relating to the Agreement or the
transactions contemplated thereby and otherwise and (b) neither it, nor any of
its affiliates or advisors, has received, or has relied upon, the advice of the
Reinsurer or any of its affiliates or advisors regarding investment, legal,
regulatory, tax or accounting matters. The Company represents and warrants that
it, along with such independent investment, accounting, tax and legal advisers
as it deems necessary, has performed an independent evaluation of the matters
relating to the Agreement, and has independently determined whether the
Agreement meets statutory, tax and financial accounting requirements applicable
to the Company. The Reinsurer has made no representations, warranties or
covenants as to statutory, tax and financial accounting matters.
6. Approvals of Governmental Authorities. No consent, waiver, license,
-------------------------------------
approval, order or authorization of, or registration, filing or declaration
with, or notices to, any person, entity or Governmental Authority is required to
be obtained, maintained, made or given by or with respect to the Company in
connection with (i) the execution and delivery of this Agreement by the Company,
or (ii) the consummation by the Company of the transactions contemplated hereby.
18
7. Investigations. The Company will notify the Reinsurer immediately, in
--------------
writing, of any and all investigations of the Company or its directors,
principal officers or shareholders conducted by any Governmental Authority,
other than routine investigations by insurance regulators.
8. Reinsured Contracts. The Reinsured Contracts have been filed and
-------------------
approved by the applicable regulatory authorities as required by applicable law,
rule or regulation, and all Reinsured Contracts are in compliance with
applicable tax laws and federal or state laws governing the offering or sale of
securities.
9. Actions and Proceedings. The Company expressly acknowledges that there
-----------------------
are no (a) outstanding orders, decrees or judgments by or with any Governmental
Authority or (b) actions, suits, arbitrations or legal, administrative or other
proceedings (including, without limitation, any conservation, rehabilitation,
liquidation or similar proceeding) pending or, to the knowledge of the Company,
threatened against the Company, at law or in equity, or before or by any
Governmental Authority or before any arbitrator of any kind, which would, in the
case of (a) or (b), preclude or prohibit the execution or performance of
material obligations of the Company under this Agreement.
10. Documents True and Complete. The Company represents and warrants that
---------------------------
it has provided to the Reinsurer true, complete and correct copies of documents
and financial statements, including, but not limited to, the Company SAP
Statements. The Company further represents and warrants that all factual
information that it provided to the Reinsurer is complete and accurate as of the
date of the document in which such information is contained and that any
assumptions made in providing this information were based upon informed judgment
and are
19
consistent with sound actuarial principles. The Company also acknowledges that
the Reinsurer has relied on this information and the foregoing representations
in entering into this Agreement.
11. No Material Changes. The Company expressly acknowledges that it is not
-------------------
aware of any omissions, errors, changes or discrepancies that would have the
effect of making the documentation and latest financial statements that have
been provided to the Reinsurer inaccurate in any material respect.
12. Tax Status. The Company is subject to U.S. taxation under Subchapter L
----------
of Chapter 1 of the Code.
13. Reinsurance Agreements. Each Reinsurance Agreement is or was in full
----------------------
force and effect to the respective dates noted therein and is a valid and
binding obligation of the Company and MetLife, except to the extent
enforceability may be limited by bankruptcy, insolvency, fraudulent transfer,
reorganization, moratorium and other similar laws relating to or affecting
creditors' rights generally and by general equitable principles (regardless of
whether such enforceability is considered in a proceeding in equity or at law).
Neither the Company nor MetLife is in default as to any provision of any
Reinsurance Agreement.
14. Third Party Reinsurance on Reinsured Risks. The Company has informed
------------------------------------------
the Reinsurer of all existing other reinsurance arrangements that MetLife has
entered into in order to reinsure MetLife's liabilities under the Assumed
Contracts, and the Company's obligations to MetLife under the Reinsurance
Agreements are net of MetLife's third party reinsurance arrangements, whether or
not collectible.
20
ARTICLE XIV.
REPRESENTATIONS, WARRANTIES AND COVENANTS OF THE REINSURER
----------------------------------------------------------
The Reinsurer represents, warrants and covenants as follows:
1. Organization, Standing and Authority of the Reinsurer. The Reinsurer is
-----------------------------------------------------
a long-term insurance company duly organized, validly existing and in good
standing under the laws of Bermuda, and has all requisite corporate power and
authority to own, lease and operate its properties and assets and to carry on
the operations of its business as they are now being conducted.
2. Authorization. The Reinsurer has all requisite corporate power and
-------------
authority to enter into this Agreement and to perform its obligations hereunder.
The execution and delivery by the Reinsurer of this Agreement, and the
performance by the Reinsurer of its obligations under this Agreement, have been
duly authorized by all necessary corporate action. This Agreement, when duly
executed and delivered by the Reinsurer, subject to the due execution and
delivery by the Company, will be a valid and binding obligation of the
Reinsurer, enforceable against the Reinsurer in accordance with its terms.
3. No Conflict or Violation. The execution, delivery and performance of
------------------------
this Agreement and the consummation of the transactions contemplated hereby will
not (a) violate any provision of the Memorandum of Association, Bye-laws or
other charter or organizational document of the Reinsurer, or (b) violate any
order, judgment, injunction, award or decree of any court, arbitrator or
governmental or regulatory body against, or binding upon, or any agreement with,
or condition imposed by, any governmental or regulatory body, foreign or
domestic, binding upon the Reinsurer.
4. Approvals of Governmental Authorities. Other than the Reinsurer's
-------------------------------------
obligations as a long-term insurer under Bermuda law, no consent, waiver,
license, approval, order or
21
authorization of, or registration, filing or declaration with, or notices to,
any person, entity or Governmental Authority is required to be obtained, made or
given by or with respect to the Reinsurer in connection with (i) the execution
and delivery of this Agreement by the Reinsurer, or (ii) the consummation by the
Reinsurer of the transactions contemplated hereby.
5. Tax Election. The Reinsurer has submitted to the U.S. Internal Revenue
------------
Service an election to be subject to U.S. federal income tax pursuant to the
provisions of section 953(d) of the Internal Revenue Code of 1986, as amended
(the "Code"), and has entered into such agreements or undertakings as were
----
required in order for such election to become effective. Notwithstanding the
foregoing, if the Reinsurer should revoke or otherwise lose its US taxpayer
status then the Reinsurer will reimburse the Company for any applicable US
federal excise tax payable with respect to the reinsurance premiums received by
the Reinsurer under this Agreement after the effective date of the Reinsurer's
revocation or loss of its US taxpayer status, to the extent that such revocation
or loss is the sole cause of the Company's liability for such tax.
6. FATCA. The Reinsurer certifies that it (i) has an election in place
-----
under Section 953(d) of the Internal Revenue Code of 1986, as amended, (ii) is
not a specified insurance company within the meaning of Treasury Regulation
(S) 1.1471-5(e)(1)(iv), and (iii) is not licensed to do business in any state.
The Reinsurer will provide the Company with an IRS Form W-9 certifying that it
is a U.S. person in accordance with Sections 1471 - 1474 of the US Internal
Revenue Code and applicable Treasury Regulations (collectively, "FATCA"),
-----
(i) upon execution of this Indemnity Retrocession Agreement, (ii) promptly upon
reasonable demand by the Company and (iii) promptly upon learning that any such
information previously provided by the Reinsurer has become obsolete or
incorrect.
22
If the Company does not receive such information on a timely basis, or such
other appropriate certification that the Reinsurer is not subject to withholding
under FATCA, the Company will notify the Reinsurer of its failure to receive
such information or certification. The Reinsurer will then have at least 60 days
from its receipt of such notice to provide such information or certification to
the Company. If the Reinsurer does not provide such information or certification
to the Company by the end of such 60-day period, the Company may withhold
appropriate FATCA tax until such time as the Reinsurer shall have provided such
information or certification to the Company.
7. Tax Status. The Reinsurer is subject to U.S. taxation under Subchapter L
----------
of Chapter 1 or Subpart F of Part III of Subchapter N or Chapter 1 of the Code.
8. Keepwell Agreement. The Keepwell Agreement is in full force and effect
------------------
and is a valid and binding obligation of the Reinsurer and the Bank, except to
the extent enforceability may be limited by bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium and other similar laws relating to or
affecting creditors' rights generally and by general equitable principles
(regardless of whether such enforceability is considered in a proceeding in
equity or at law). Neither the Reinsurer nor the Bank is in default as to any
obligations in the Keepwell Agreement.
ARTICLE XV.
DAC TAX
-------
1. DAC Tax Election. The Company and the Reinsurer hereby agree to the
----------------
following pursuant to Section 1.848-2(g)(8) of the Income Tax Regulations (the
"Regulations") issued under Section 848 of the Code. The terms used in this
-----------
Article are defined by reference to Regulation Section 1.848-2 in effect at the
date hereof. The term "net consideration" as used in
23
this Article will refer to net consideration as defined in Regulation Section
1.848-2(f) in effect at the date hereof.
2. Tax Return. Each party shall attach a schedule to its federal income tax
----------
return that identifies this Agreement as a reinsurance agreement for which the
joint election under Regulation Section 1.848-2(g)(8) has been made, and shall
file its respective federal income tax returns in a manner consistent with the
provisions of Regulation Section 1.848-2 in effect on the date hereof.
3. Capitalization of Expenses. The party with net positive consideration
--------------------------
under this Agreement for each taxable year shall capitalize specified policy
acquisition expenses with respect to this Agreement without regard to the
general deductions limitation of Section 848(c)(1) of the Code.
4. Information. Each party agrees to exchange information pertaining to the
-----------
amount of net consideration under this Agreement each year to ensure
consistency. The parties also agree to exchange information which may otherwise
be required by the Internal Revenue Service. The Reinsurer shall provide the
Company by the first day of May in each year its calculation of the net
consideration for the preceding calendar year. Such calculation shall be
accompanied by a statement signed by an officer of the Reinsurer stating that
the Reinsurer will report such net consideration in its tax return for the
preceding calendar year. The Company may contest such calculation by providing
an alternative calculation to the Reinsurer in writing within 30 days after the
Company's receipt of the Reinsurer's calculation. If the Company does not so
notify the Reinsurer, the Company shall report the net consideration as
determined by the Reinsurer in the Company's tax return for the previous
calendar year. If the Company contests the Reinsurer's calculation of the net
consideration, the parties will act in good faith to reach an
24
agreement as to the correct amount within 30 days after the date the Company
submits its alternative calculation. Each party shall report such corrected
amount in its respective tax returns for the preceding calendar year, if the
parties have agreed to the Company's alternative calculation.
5. Disputes. If during the 30 day period after the date the Company submits
--------
its alternative calculation the Company and the Reinsurer are unable to reach
agreement, they shall within 10 days following the expiration of such 30 day
period mutually agree to select a nationally recognized accounting firm (the
"Third Party Accountant") to promptly review this Agreement and the calculations
----------------------
of the Company and the Reinsurer, which review shall commence no later than five
(5) days after the selection of the Third Party Accountant, for the purpose of
calculating the net consideration under this Agreement. In making such
calculation, the Third Party Accountant shall consider only those items or
amounts in the Reinsurer's calculation as to which the Company has disagreed.
The Third Party Accountant shall deliver to the Company and the Reinsurer, as
promptly as practicable (but no later than 30 days after the commencement of
their review), a report setting forth such calculation, which calculation shall
result in a net consideration between the amount thereof shown in the
Reinsurer's calculation and the amount thereof in the Company's calculation.
Such report shall be final and binding upon the Company and the Reinsurer. The
fees, costs and expenses of the Third Party Accountant shall be borne equally by
the Company and the Reinsurer.
6. Duration of Election. This election shall be effective for the taxable
--------------------
year of each party that includes the Coverage Effective Date, and for all
subsequent years during which this Agreement remains in effect.
25
ARTICLE XVI.
MISCELLANEOUS
-------------
1. Headings and Schedules. Headings used herein are not a part of this
----------------------
Agreement and shall not affect the terms hereof. The attached Schedules and
Appendix A are part of this Agreement.
2. Notices. All notices and communications hereunder shall be in writing
-------
and shall be deemed given if received three (3) days after mailing, or if by
telefax or by hand, when received, and if by overnight mail, on the next day.
Any written notice shall be by either certified or registered mail, return
receipt requested, or overnight delivery service (providing for delivery
receipt) or delivered by hand. All notices or communications with the Reinsurer
under this Agreement shall be addressed as follows:
Catalyst Re Ltd.
Clarendon Xxxxx
0 Xxxxxx Xxxxxx
Xxxxxxxx XX 00
Xxxxxxx
Xxxxxxxxx: Secretary
Telephone: 000-000-0000
Facsimile: 000-000-0000
All notices and communications with the Company under this Agreement shall be
directed to:
MetLife Insurance Company USA
1095 Avenue of the Americas
Xxxxxxxxx Xxxxx
Xxx Xxxx, XX 00000
Attention: Xx. Xxxxxxx Xxxxx
Email Address: xxxxxx@xxxxxxx.xxx
------------------
3. Severability. If any term or provision of this Agreement shall be held
------------
void, illegal, or unenforceable, the validity of the remaining portions or
provisions shall not be affected thereby.
26
4. Governing Law. This Agreement shall be governed by the laws of the State
-------------
of New York, without reference to the conflict of laws rules thereof. The
parties agree that the Federal courts in the State of New York, or the state
courts of such state, have jurisdiction to hear any matter relating to
compelling arbitration, enforcing the judgment of an arbitral panel or deciding
any matter subject to Article XI, section 3, and the parties hereby consent to
such jurisdiction. The parties hereby waive, to the fullest extent permitted by
law, any objection it may now or hereafter have to the laying of such venue, or
any claim that a proceeding has been brought in an inconvenient forum. THE
COMPANY AND THE REINSURER HEREBY WAIVE ANY AND ALL RIGHTS TO TRIAL BY JURY IN
ANY MATTER ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS
CONTEMPLATED HEREBY.
5. Amendments and Successors. This Agreement may be amended only by written
-------------------------
agreement of the parties. Any change or modification to this Agreement shall be
null and void unless made by amendment to this Agreement and signed by both
parties. The provisions of this Agreement shall inure to the benefit of and be
binding upon the successors and permitted assigns of the Company and the
Reinsurer.
6. Entire Agreement. This Agreement, including the Schedules and Appendix
----------------
attached hereto, and the Cash Collateral Pledge Agreement constitute the entire
agreement between the parties with respect to the reinsurance hereunder. There
are no understandings between the parties with respect to the reinsurance
hereunder other than as expressed in this Agreement and the Cash Collateral
Pledge Agreement.
7. Assignment. This Agreement may not be assigned by any party without the
----------
prior written consent of the other party, and any purported assignment without
such consent shall be
27
null and void; PROVIDED, HOWEVER, THAT the Reinsurer shall have the right to
assign the rights under this Agreement by way of novation to a reinsurer that is
(i) under common control with the Reinsurer, (ii) subject to a keepwell
agreement issued by the Bank in favor of such reinsurer in a form substantially
similar to the Keepwell Agreement and (iii) a U.S. taxpayer.
8. Confidentiality. The Company and the Reinsurer agree that the terms and
---------------
conditions of this Agreement are confidential and will not disclose either
verbally or by any means, unless written consent to such disclosure has been
provided by the other party, any aspect of the contract including a general
description of the transaction to any non-affiliated third party except (a) to
its attorneys, auditors and regulators on a confidential basis and (b) to the
extent required by applicable laws and regulations or by any subpoena or similar
legal process or required or requested by any government or regulatory authority
or stock exchange having authority or jurisdiction. The Company and the
Reinsurer agree to continue to be bound by the terms of the Confidentiality
Agreement dated by and between the parties, which is attached as Schedule E
----------
hereto and incorporated herein by reference. Notwithstanding the foregoing, each
party to this Agreement, and each of their employees, representatives and other
agents, are hereby expressly authorized to disclose to any and all persons,
without limitation of any kind, the tax treatment and tax structure of the
transactions contemplated by this presentation and all materials of any kind
(including opinions or other tax analyses) that are provided to any such persons
relating to such tax treatment and structure. This authorization of tax
disclosure is retroactively effective to the commencement of the first
discussions between the parties to this Agreement regarding the transactions
contemplated herein.
9. Counterparts; Fax Signatures. This Agreement may be executed in
----------------------------
counterparts, each of which shall be an original, but all of which together
shall constitute one and the same
28
agreement. The facsimile signature of any of the parties hereto may be relied
upon and shall have the same effect as the original signature of such party.
29
ARTICLE XVII.
EXECUTION
---------
In witness of the above, this Agreement is executed in duplicate on the dates
indicated below.
ATTEST: METLIFE INSURANCE COMPANY USA
By: /s/ Xxxx Xxxxxx By: /s/ Xxxxxxx Xxxxx
----------------------------- -----------------------------------
Name: Xxxx Xxxxxx Name: Xxxxxxx Xxxxx
Title: Assistant Vice President Title: Senior Vice President
Date: December 2, 2014 Date: December 2, 2014
ATTEST: CATALYST RE LTD.
By: /s/ Xxxxx Xxxxxxx By: /s/ Xxxxxxx X. Xxxxx
----------------------------- -----------------------------------
Name: Xxxxx Xxxxxxx Name: Xxxxxxx X. Xxxxx
Title: Legal Secretary Title: Director
Date: December 5, 2014 Date: December 5, 2014
30
Schedule A - Periodic Settlements Report
Schedule B - Reinsurance Accounting Report
Schedule C - Reinsurance Agreements
Schedule D - Reinsured Contracts
Schedule E - Confidentiality Agreement
Schedule F - Third Party Reinsurance
Appendix A - Formulas, Schedules and Calculations
SCHEDULE A
PERIODIC SETTLEMENTS REPORT
---------------------------
FROM REINSURER TO COMPANY
---------------------------
Accounting Period:
---------------------------
Date Report Completed:
---------------------------
A) Benefit Allowance Balance from prior Accounting Period =
B) Reinsured Claims paid prior Accounting Period =
C) One year equivalent LIBOR rate for current Accounting Period =
D) Actual days in current Accounting Period
E) Benefit Allowance Increase Amount for current Accounting Period =
F) Benefit Allowance Balance for current Accounting Period
((A-B)*(1+C*(D/360)) + E) =
1. Reinsurance Premiums =
2. Reinsured Claims =
3. Net Amount Due (1 - 2) =
G) One year LIBOR Rate for next Accounting Period =
SCHEDULE B
REINSURANCE ACCOUNTING REPORT
-----------------------------
FROM COMPANY TO REINSURER
-------------------------
Accounting Period: _________
Date Report Completed: _________
Reinsured Risks Paid During the Prior Accounting Period:
Account Death Benefit
Annual Value in excess of
Date- Step-up Less Account Value Amount of
of- Date of Death Surrender Less Surrender Third Party Reinsured
Name SSN Death Issue Benefit Charge Charge Reinsurance Risk
Aggregate
Totals
SCHEDULE C
REINSURANCE AGREEMENTS
----------------------
1) Automatic Reinsurance Agreement Between Metropolitan Life Insurance
Company and MetLife Insurance Company USA (as successor to Exeter Reassurance
Company, Ltd.)
Agreement No. 17258
Effective December 1, 2004
2) Automatic Reinsurance Agreement Between New England Life Insurance
Company and MetLife Insurance Company USA (as successor to Exeter Reassurance
Company, Ltd.)
Agreement No. 15890
Effective June 26, 2001
3) Automatic Reinsurance Agreement Between First MetLife Investors
Insurance Company and MetLife Insurance Company USA (as successor to Exeter
Reassurance Company, Ltd.).
Agreement No. 17259
Effective December 1, 2004
SCHEDULE D
----------
REINSURED CONTRACTS
-------------------
Individual variable annuity contracts either (i) issued by the Company (or any
predecessor of the Company) or (ii) issued by MetLife and reinsured by the
Company, and, in either case, in-force as of the Coverage Effective Date having
the following plan codes and issue dates:
PLAN CODE SUMMARY FOR DB ANNUAL RATCHET INFORCE AS OF 9-30-05
-------------------------------------------------------------
COMP SUM MIN MAX MIN MAX
PLAN- ANY- COMP ACCOUNT- EFFECTIVE- EFFECTIVE- MME- MME-
CODE CODE ANY SHR-CLASS COUNT VALUE DATE DATE CHARGES CHARGES
------ ---- ------- --------- ----- ----------- ---------- ---------- ------- -------
225010 001 MLFS B-SHARE 3,812 222,071,970 12-Dec-01 16-Jun-04 135 160
225020 001 MLFS C-SHARE 201 16,186,553 07-Feb-02 01-Aug-03 175 200
225030 001 MLFS L-SHARE 101 9,770,953 01-Mar-02 30-Sep-03 160 185
225050 001 MLFS BONUS 696 73,408,272 18-Dec-01 06-Aug-03 180 205
225080 001 MLFS BONUS 885 71,424,601 05-May-03 23-May-05 190 215
225090 001 MLFS BONUS 904 72,684,753 04-May-04 30-Sep-05 190 215
2250A0 001 MLFS B-SHARE 4,960 291,912,076 07-May-04 30-Sep-05 145 170
2250A1 001 MLFS B-SHARE 106 7,523,680 07-Jul-04 28-Sep-05 145 170
2250B0 001 MLFS B-SHARE 3,995 198,995,837 05-May-03 12-Sep-05 145 170
2250B1 001 MLFS B-SHARE 2 92,174 18-May-04 22-Jun-04 145 145
2250C0 001 MLFS C-SHARE 47 2,996,395 09-Jun-03 22-Jun-04 185 210
2250D0 001 MLFS C-SHARE 39 4,256,607 17-May-04 14-Sep-05 185 210
2250E0 001 MLFS L-SHARE 41 3,463,899 08-Jun-04 02-Sep-05 170 195
2250L0 001 MLFS L-SHARE 90 9,275,994 12-May-03 08-Jul-04 170 195
BN2201 000 XXX-XXX BONUS 4,268 477,096,385 17-Apr-01 15-Oct-03 165 190
BN2203 000 XXX-XXX BONUS 6,262 639,118,674 02-May-03 30-Sep-05 175 200
BN22M3 004 MLI-USA BONUS 1,645 246,287,600 02-May -03 30-Sep-05 175 200
BN22ML 004 MLI-USA BONUS 432 72,543,297 02-Jul-02 23-Dec-03 165 190
CS5201 004 MLI-USA C-SHARE 163 20,312,940 24-Oct-01 02-Jul-03 185 210
CS5203 004 MLI-USA C-SHARE 597 68,169,730 09-May-03 30-Sep-05 195 220
CS52M3 004 MLI-USA C-SHARE 414 53,553,925 05-May-03 29-Sep-05 195 220
CS52ML 004 MLI-USA C-SHARE 248 34,357,894 22-Mar-02 01-May-03 185 210
LS4201 004 MLI-USA L-SHARE 1,149 118,360,098 30-May-01 25-Aug-03 170 195
LS4203 004 MLI-USA L-SHARE 2,948 328,387,591 06-May-03 30-Sep-05 180 205
COMP SUM MIN MAX MIN MAX
PLAN- ANY- COMP ACCOUNT- EFFECTIVE- EFFECTIVE- MME- MME-
CODE CODE ANY SHR-CLASS COUNT VALUE DATE DATE CHARGES CHARGES
------ ---- ------- --------- ----- ----------- ---------- ---------- ------- -------
XX0000 000 XXX-XXX L-SHARE 1,257 120,052,389 26-Nov-04 30-Sep-05 180 205
LS420R 004 MLI-USA L-SHARE 1 24,554 16-Apr-03 16-Apr-03 170 170
LS42M3 004 MLI-USA L-SHARE 1,909 239,746,854 02-May-03 30-Sep-05 180 205
LS42ML 004 MLI-USA L-SHARE 627 78,546,770 08-Mar-02 14-Jul-03 170 195
ST1201 004 MLI-USA B-SHARE 2,655 234,944,133 17-Apr-01 28-Oct-03 140 165
ST1203 004 MLI-USA B-SHARE 6,576 472,719,536 06-May-03 29-Sep-05 150 175
ST120X 004 MLI-USA B-SHARE 26 2,600,663 19-Mar-02 23-Apr-03 140 165
ST12M3 004 MLI-USA B-SHARE 1,358 150,097,118 02-May-03 30-Sep-05 150 175
ST12ML 004 MLI-USA B-SHARE 314 33,781,879 25-Jun-02 07-Jul-03 140 165
ST12R3 004 MLI-USA B-SHARE 13 481,403 04-Aug-03 24-Jan-05 150 175
ST12X3 004 MLI-USA B-SHARE 79 5,064,308 07-Aug-03 07-Sep-05 150 175
ST13MR 004 MLI-USA B-SHARE 1 180,937 23-Jun-04 23-Jun-04 175 175
125010 005 NEF B-SHARE 2,602 188,824,635 16-Ju1-01 29-Oct-03 135 160
125011 005 NEF B-SHARE 75 5,233,235 24-Sep-02 06-Jun-03 135 160
125020 005 NEF C-SHARE 75 6,349,815 31-Aug-01 08-Ju1-03 170 195
125030 005 NEF L-SHARE 31 3,016,001 13-Jul-01 27-May-03 160 160
125040 005 NEF P-SHARE 2,512 209,561,930 09-Jul-01 04-Nov-03 125 150
125050 005 NEF BONUS 883 92,335,576 18-Jul-01 27-Fcb-04 170 195
125080 005 NEF BONUS 451 48,592,416 12-May-03 29-Sep-04 180 205
125090 005 NEF BONUS 220 20,744,016 13-May-04 30-Sep-05 180 205
1250A0 005 NEF B-SHARE 1,417 98,965,432 10-May-04 30-Sep-05 145 170
1250A1 005 NEF B-SHARE 22 1,267,510 17-May-04 15-Jun-05 145 170
1250B0 005 NEF B-SHARE 1,369 92,497,239 09-May-03 04-Aug-04 145 170
1250B1 005 NEF B-SHARE 44 3,243,221 28-May-03 08-Apr-04 145 170
1250C0 005 NEF C-SHARE 42 5,295,175 22-May-03 01-Sep-04 180 205
1250D0 005 NEF C-SHARE 36 4,869,987 01-Jun-04 20-Sep-05 180 205
1250E0 005 NEF L-SHARE 22 2,931,734 01-Jun-04 25-Aug-05 170 195
1250F0 005 NEF P-SHARE 991 73,065,376 07-May-04 30-Sep-05 135 160
1250F1 005 NEF P-SHARE 17 1,368,585 16-Jun-04 15-Jul-05 135 135
1250L0 005 NEF L-SHARE 18 1,740,967 17-Jun-03 02-Jun-04 170 170
1250P0 005 NEF P-SHARE 1,430 97,488,452 12-May-03 01-Apr-05 135 160
1250P1 005 NEF P-SHARE 6 901,164 10-Oct-03 04-Jun-04 135 135
125110 005 NEF B-SHARE 2 164,931 14-Aug-02 29-Aug-02 135 135
125140 005 NEF P-SHARE 13 769,023 03-Dec-01 25-Mar-03 125 150
125150 005 NEF BONUS 2 172,454 19-Feb-03 29-Apr-03 170 170
125180 005 NEF BONUS 3 322,428 20-Oct-03 14-May-04 180 205
COMP SUM MIN MAX MIN MAX
PLAN- ANY- COMP ACCOUNT- EFFECTIVE- EFFECTIVE- MME- MME-
CODE CODE ANY SHR-CLASS COUNT VALUE DATE DATE CHARGES CHARGES
------ ---- ------- --------- ----- ----------- ---------- ---------- ------- -------
1251A0 005 NEF B-SHARE 3 118,225 24-Sep-04 24-May-05 145 145
1251B0 005 NEF B-SHARE 2 39,241 04-Sep-03 08-Mar-04 145 145
1251F0 005 NEF P-SHARE 3 437,119 09-Jun-04 26-Aug-04 135 135
1251P0 005 NEF P-SHARE 4 61,954 24-Oct-03 25-Feb-04 135 160
BN2101 007 MLI-MO BONUS 2,461 322,888,891 27-Jun-01 30-Sep-03 165 190
BN2103 007 MLI-MO BONUS 2,200 270,929,941 05-May-03 29-Sep-05 175 200
CS5101 007 MLI-MO C-SHARE 559 64,692,910 16-Nov-01 15-Sep-03 185 210
CS5103 007 MLI-MO C-SHARE 347 36,612,535 14-May-03 23-Sep-05 195 220
FL3ED3 007 MLI-MO A-SHARE 779 72,126,267 02-May-03 22-Jun-04 85 110
FL3ED4 007 MLI-MO A-SHARE 981 92,469,701 06-May-04 29-Sep-05 95 120
FL3EDB 007 MLI-MO A-SHARE 488 42,327,987 01-May-02 23-Jun-03 85 110
FL3EDJ 007 MLI-MO A-SHARE 881 71,630,210 16-May-01 23-Aug-02 85 110
FL3ER3 007 MLI-MO A-SHARE 8 208,934 26-Aug-03 26-Apr-04 85 110
FL3ER4 007 MLI-MO A-SHARE 1 157,805 25-May-04 25-May-04 95 95
LS4101 007 MLI-MO L-SHARE 2,704 240,125,832 26-Sep-01 05-Sep-03 170 195
LS4103 007 MLI-MO L-SHARE 2,742 272,654,339 06-May-03 13-Sep-05 180 205
LS4104 007 MLI-MO L-SHARE 1,012 100,099,678 23-Nov-04 30-Sep-05 180 205
LS410R 007 MLI-MO L-SHARE 1 99,076 20-Mar-03 20-Mar-03 170 170
ST1101 007 MLI-MO B-SHARE 1,198 111,595,643 31-Aug-01 04-Nov-03 140 165
ST1103 007 MLI-MO B-SHARE 1,508 142,563,668 02-May-03 30-Sep-05 150 175
5T110R 007 MLI-MO B-SHARE 7 446,262 29-Jul-02 07-Oct-02 140 165
ST110X 007 MLI-MO B-SHARE 8 1,028,340 25-Nov-02 01-May-03 140 140
ST11X3 007 MLI-MO B-SHARE 23 1,681,466 19-Aug-03 21-Jul-05 150 175
ST1AG3 007 MLI-MO B-SHARE 3 204,885 12-Sep-03 09-Feb-04 140 140
ST1AGB 007 MLI-MO B-SHARE 3 256,498 04-Feb-03 25-Feb-03 140 140
ST1AGR 007 MLI-MO B-SHARE 3 248,426 18-Mar-03 27-Mar-03 140 140
ST1AR3 007 MLI-MO B-SHARE 1 88,660 08-Apr-04 08-Apr-04 165 165
ST1ED3 007 MLI-MO B-SHARE 562 30,629,221 02-May-03 19-Jul-04 140 165
COMP SUM MIN MAX MIN MAX
PLAN- ANY- COMP ACCOUNT- EFFECTIVE- EFFECTIVE- MME- MME-
CODE CODE ANY SHR-CLASS COUNT VALUE DATE DATE CHARGES CHARGES
------ ---- ------- --------- ----- ----------- ---------- ---------- ------- -------
XX0XX0 000 XXX-XX B-SHARE 414 21,671,184 05-May-04 27-Sep-05 150 175
ST1EDB 007 MLI-MO B-SHARE 754 44,437,413 01-May-02 28-May-03 140 165
ST1EDJ 007 MLI-MO B-SHARE 3,012 171,074,959 09-Apr-01 09-Sep-02 140 165
ST1EDX 007 MLI-MO B-SHARE 9 266,309 05-Jul-01 02-May-02 140 165
ST1ER3 007 MLI-MO B-SHARE 4 128,749 29-Jul-03 06-Apr-04 140 140
ST1EX3 007 MLI-MO B-SHARE 3 42,683 24-Mar-04 25-May-04 140 140
ST1EX4 007 MLI-MO B-SHARE 2 30,174 29-Jun-04 27-Aug-04 150 175
ST1EXB 007 MLI-MO B-SHARE 6 474,602 09-May-02 21-Feb-03 140 165
ST1NA3 007 MLI-MO B-SHARE 2,987 271,153,428 06-May-03 03-Sep-04 140 165
ST1NA4 007 MLI-MO B-SHARE 960 82,387,705 07-May-04 30-Sep-05 150 175
ST1NAB 007 MLI-MO B-SHARE 3,715 360,593,131 03-May-02 13-Aug-03 140 165
ST1NAV 007 MLI-MO B-SHARE 2,510 243,033,559 20-Apr-01 30-Jul-02 140 165
BN2101 008 MLI-CA BONUS 224 32,739,143 29-Aug-01 28-May-03 165 190
BN2103 008 MLI-CA BONUS 197 27,107,999 16-May-03 20-Sep-05 175 200
CS5101 008 MLI-CA C-SHARE 57 8,409,741 15-Jan-02 11-Apr-03 185 210
CS5103 008 MLI-CA C-SHARE 49 6,579,870 08-May-03 16-Sep-05 195 195
FL3ED3 008 MLI-CA A-SHARE 73 11,011,994 08-May-03 02-Jun-04 85 110
FL3ED4 000 XXX XX A-SHARE 80 6,326,524 10-May-04 27-Sep-05 95 120
FL3EDB 008 MLI-CA A-SHARE 38 3,619,034 01-May-02 23-May-03 85 110
FL3EDJ 008 MLI-CA A-SHARE 70 6,645,664 30-May-01 14-May-02 85 110
LS4101 008 MLI-CA L-SHARE 308 32,899,034 26-Sep-01 l8-Jun-03 170 195
LS4103 008 MLI-CA L-SHARE 269 33,302,542 05-May-03 31-Dec-04 180 205
LS4104 008 MLI-CA L-SHARE 102 10,428,488 30-Nov-04 27-Sep-05 180 205
ST1101 008 MLI-CA B-SHARE 158 14,043,564 10-Dec-01 22-May-03 140 165
ST1103 008 MLI-CA B-SHARE 141 12,505,040 08-May-03 20-Sep-05 150 175
ST11X3 008 MLI-CA B-SHARE 3 171,400 21-Sep-04 29-Sep-05 150 150
ST1AGR 008 MLI-CA B-SHARE 1 20,449 09-Sep-02 09-Sep-02 140 140
COMP SUM MIN MAX MIN MAX
PLAN- ANY- COMP ACCOUNT- EFFECTIVE- EFFECTIVE- MME- MME-
CODE CODE ANY SHR-CLASS COUNT VALUE DATE DATE CHARGES CHARGES
------ ---- ------- --------- ----- ----------- ---------- ---------- ------- -------
XX0XX0 000 XXX-XX B-SHARE 2 50,632 18-Feb-04 01-Mar-04 140 140
ST1ED3 008 MLI-CA B-SHARE 30 1,278,699 08-May-03 10-May-04 140 165
ST1ED4 008 MLI-CA B-SHARE 17 1,074,354 25-May-04 02-May-05 150 175
ST1EDB 008 MLI-CA B-SHARE 61 3,987,478 02-May-02 07-May-03 140 165
ST1EDJ 008 MLI-CA B-SHARE 215 11,099,558 09-Apr-01 29-May-02 140 165
ST1EXB 008 MLI-CA B-SHARE 1 151,272 12-Jul-02 12-Jul-02 140 140
ST1NA3 008 MLI-CA B-SHARE 262 24,475,281 05-May-03 27-May-04 140 165
ST1NA4 008 MLI-CA B-SHARE 110 12,315,246 18-May-04 27-Sep-05 150 175
ST1NAB 008 MLI-CA B-SHARE 288 30,843,616 09-May-02 10-Jun-03 140 165
ST1NAV 008 MLI-CA B-SHARE 186 18,689,812 29-May-01 30-Jul-02 140 165
BN2101 000 XXXX-XX BONUS 41 6,989,491 25-Nov-02 01-Aug-03 165 165
BN2103 000 XXXX-XX BONUS 1,119 131,610,802 13-May-03 30-Sep-05 175 175
BN21M3 000 XXXX-XX BONUS 868 127,492,783 03-Jun-03 28-Sep-05 155 175
BN21ML 009 FMLI-NY BONUS 10 2,772,211 07-Feb-03 23-Dec-03 165 165
CS5103 009 FMLI-NY C-SHARE 68 7,526,918 31-Jul-03 27-Sep-05 195 195
CS51M3 009 FMLI-NY C-SHARE 54 5,711,581 02-Jul-03 28-Sep-05 195 195
CS51ML 009 FMLI-NY C-SHARE 1 25,259 26-Mar-03 26-Mar-03 185 185
FL3ED4 009 FMLI-NY A-SHARE 3 304,555 14-Mar-05 27-Sep-05 95 95
FL3EDB 000 XXXX-XX A-SHARE 1 197,741 10-Mar-03 10-Mar-03 85 85
LS4101 009 FMLI-NY L-SHARE 121 7,709,015 27-Nov-02 02-Jul-03 170 170
LS4103 000 XXXX-XX L-SHARE 382 42,069,767 10-Jun-03 08-Mar-05 180 180
LS4104 000 XXXX-XX L-SHARE 196 20,134,229 23-Nov-04 29-Sep-05 180 180
LS41M3 000 XXXX-XX L-SHARE 328 41,004,154 25-Aug-03 30-Sep-05 180 180
LS41ML 009 FMLI-NY L-SHARE 107 9,726,171 27-Nov-02 21-May-03 170 170
ST1101 009 FMLI-NY B-SHARE 11 792,797 30-Dec-02 21-Jul-03 140 140
ST1103 009 FMLI-NY B-SHARE 477 35,798,697 11-Jun-03 29-Sep-05 150 150
ST11M3 009 FMLI-NY B-SHARE 181 16,796,609 23-May-03 30-Aug-05 150 150
COMP SUM MIN MAX MIN MAX
PLAN- ANY- COMP ACCOUNT- EFFECTIVE- EFFECTIVE- MME- MME-
CODE CODE ANY SHR-CLASS COUNT VALUE DATE DATE CHARGES CHARGES
------ ---- ------- --------- ----- ----------- ---------- ---------- ------- -------
ST11R3 009 FMLI-NY B-SHARE 1 7,855 27-Sep-04 27-Sep-04 150 150
ST1ED3 009 FMLI-NY B-SHARE 2 157,461 25-Jun-03 14-Aug-03 140 140
ST1ED4 009 FMLI-NY B-SHARE 1 112,900 02-Jun-04 02-Jun-04 150 150
ST1NA3 009 FMLI-NY B-SHARE 40 5,297,275 16-May-03 04-May-04 140 140
ST1NA4 009 FMLI-NY B-SHARE 54 3,700,206 22-Jun-04 29-Sep-05 150 150
ST1NAB 009 FMLI-NY B-SHARE 3 124,274 04-Feb-03 20-Feb-03 140 140
SCHEDULE E
CONFIDENTIALITY AGREEMENT
-------------------------
SCHEDULE F
THIRD PARTY REINSURANCE
-----------------------
The Company (as successor to Exeter) has previously ceded or retroceded, as
the case may be, a portion of the GMBD risk assumed from MetLife Investors,
MetLife Investors USA, MetLife Investors of California, and New England Life
Insurance Company to AXA Corporate Solutions Life Reinsurance Company ("AXA").
The Agreement with AXA covers a 25% quota share of the GMBD risk on business
written by the 4 companies from April 1, 2001 through June 30, 2004.
APPENDIX A
----------
PROXY TOTAL For each Accounting Period T (where T = 1 to 15) during
ACCOUNT VALUE the Premium Payment Period, the Proxy Total Account Value
will equal:
$7,591,263,000 * (Alpha0t + Alpha1t XtBeta1t),
where Alpha\\0t\\, Alpha\\1t\\, and Beta\\1t\\ are
constants fixed and specified in SCHEDULE 1, and
1 12t
Xt = --- SIGMA Sn/So,
12 n=(t-1)12+1
where S\\N\\ is the value of the S&P 500 index (Bloomberg
Ticker "SPX") on the last business day of sequential
calendar month N (where N = 0 to 180), where S\\0\\ is
its value on 09/30/2005, S\\1\\ is its value on
10/31/2005, S\\2\\ is its value on 11/30/2005, etc.
BENEFIT ALLOWANCE The Benefit Allowance C\\T\\ as of the end of each
Accounting Period T is defined by the formula:
Ct = Ct + (Ct-1 - ACPt-1)(1 + rt dayst / 360),
where C\\0\\ =0 and C\\T\\ is the Benefit Allowance
Increase Amount for Accounting Period T (defined below),
and
ACPt = Min(Ct, ACt),
is the total of Reinsured Claims paid with respect to
such Accounting Period T, with AC\\T\\ being the total
of reported Reinsured Risks occurring during Accounting
Period T, R\\T\\ a rate equivalent to one-year LIBOR
set at the beginning of Accounting Period T, and
DAYS\\T\\ the number of actual calendar days in
Accounting Period T.
BENEFIT ALLOWANCE
INCREASE AMOUNT For Accounting Period T, within the Premium Payment
Period, the Benefit Allowance Increase Amount will be
determined by the formula:
Ct = $7,591,263 x (a0t + a1t (Max[0,a2t ytb2t - xt])b1t
where A\\1T\\, and B\\1t\\ are constants fixed and
specified in SCHEDULE 2, x\\T\\ is as defined under
Proxy Total Account Value, and where
1 12t
yt = ----------- SIGMA Max[So,...,Sn]/So
Min[24,12t] n=Max[1,12(t-2)+1]
After the Premium Payment Period, the Benefit Allowance
Increase Amount will be zero.
SCHEDULE 1
----------
ACCOUNTING PERIOD
------------------------
T First Day Last Day A\\0\\ A\\1\\ B\\1\\
--------- ----------- ----------- --------- -------- -------
1 10/01/2005 09/30/2006 -0.0091 1.0184 0.6556
2 10/01/2006 09/30/2007 0.0393 0.8869 0.6937
3 10/01/2007 09/30/2008 0.0538 0.7866 0.7138
4 10/01/2008 09/30/2009 0.0531 0.7001 0.7205
5 10/01/2009 09/30/2010 0.0305 0.6307 0.7051
6 10/01/2010 09/30/2011 0.0359 0.5219 0.7213
7 10/01/2011 09/30/2012 0.0416 0.4088 0.7431
8 10/01/2012 09/30/2013 0.0104 0.3414 0.7135
9 10/01/2013 09/30/2014 0.0002 0.2745 0.7048
10 10/01/2014 09/30/2015 0.0081 0.2075 0.7379
11 10/01/2015 09/30/2016 0.0019 0.1726 0.7336
12 10/01/2016 09/30/2017 -0.0029 0.1448 0.7312
13 10/01/2017 09/30/2018 -0.0043 0.1178 0.7413
14 10/01/2018 09/30/2019 -0.0073 0.0966 0.7442
15 10/01/2019 09/30/2020 -0.0102 0.0788 0.7447
SCHEDULE 2
----------
Accounting Period
-----------------------
T First Day Last Day a\\0\\ a\\1\\ a\\2\\ b\\1\\ b\\2\\
----- ----------- ----------- ------- ------- ------- ------- -------
1 10/01/2005 09/30/2006 0.0000 9.2769 1.0433 1.9145 0.8656
2 10/01/2006 09/30/2007 0.0353 5.4112 1.0692 1.6938 0.9414
3 10/01/2007 09/30/2008 0.0467 4.7347 1.0599 1.5408 0.9076
4 10/01/2008 09/30/2009 0.0549 4.3721 1.0676 1.5414 0.8967
5 10/01/2009 09/30/2010 0.0644 3.8701 1.0519 1.4139 0.9105
6 10/01/2010 09/30/2011 0.0703 3.3183 1.0298 1.2844 0.9324
7 10/01/2011 09/30/2012 0.0694 2.7801 1.0274 1.2335 0.9408
8 10/01/2012 09/30/2013 0.0657 2.3735 1.0343 1.2331 0.9292
9 10/01/2013 09/30/2014 0.0589 1.9570 1.0300 1.2078 0.9438
10 10/01/2014 09/30/2015 0.0609 1.7453 1.0099 1.1583 0.9512
11 10/01/2015 09/30/2016 0.0681 1.5341 1.0105 1.1640 0.9497
12 10/01/2016 09/30/2017 0.0597 1.3176 0.9825 1.0355 0.9820
13 10/01/2017 09/30/2018 0.0548 1.1568 1.0195 1.0906 0.9526
14 10/01/2018 09/30/2019 0.0559 1.0485 1.0004 1.0363 0.9595
15 10/01/2019 09/30/2020 0.0544 0.8731 1.0245 1.0574 0.9465
