EXHIBIT 10.2

DATED                      2007

(1) AIG INVESTMENTS EUROPE LTD

(2) IPCRE LIMITED

 

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DISCRETIONARY INVESTMENT

MANAGEMENT AGREEMENT

 

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CONTENTS

 

  1.    DEFINITIONS    3   2.    APPOINTMENT    5   3.    REGULATION    6   4.
   IPCRE’S REPRESENTATIONS AND WARRANTIES    6   5.    AIG INVESTMENTS EUROPE’S
REPRESENTATIONS AND WARRANTIES    8   6.    SCOPE OF AUTHORIZATION    8   7.   
VALUATIONS AND REPORTS    11   8.    MATERIAL IMPACTS AND CONFLICTS    11   9.
   FEES AND EXPENSES    13 10.    ACKNOWLEDGMENTS AND CONSENTS    14 11.   
EXECUTION OF TRANSACTIONS    17 12.    IPCRE’S LIABILITIES    18 13.    AIG
INVESTMENTS EUROPE’S LIABILITIES    19 14.    TERM AND TERMINATION OF AGREEMENT
   21 15.    GOVERNING LAW; SUBMISSION TO JURISDICTION    22 16.    AMENDMENTS
   22 17.    ENTIRE AGREEMENT    22 18.    INSTRUCTIONS AND COMMUNICATIONS    22
19.    NOTICES    23 20.    NO WAIVER    23 21.    SUCCESSORS AND ASSIGNS    23
22.    COUNTERPARTS    24 23.    THIRD PARTY RIGHTS    24

 

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DISCRETIONARY INVESTMENT MANAGEMENT AGREEMENT

AIG Investments Europe LTD, a company incorporated in England with registered
number 2200753 (“AIG Investments Europe”) has agreed to provide IPCRe Limited, a
company incorporated in Bermuda with its registered office at 29 Richmond Road,
Pembroke, Bermuda HMO8 (“IPCRe”) with investment services on the basis that
IPCRe is a Professional Client.

 

1.   Definitions

 

1.1   References to statutes, statutory provisions, FSA Rules and other
regulations shall be construed as references to such statute, statutory
provision or regulation as substituted, amended or replaced from time to time.
The headings in this Agreement are for convenience only and shall not affect its
construction. The Schedules form part of the Agreement. Any language following
the word “including” shall be construed without limiting the foregoing language.
A reference to any “Section” is to a clause of this Agreement unless otherwise
noted.

 

1.2   “This Agreement” means this Discretionary Investment Management Agreement,
including any attached Schedules.

 

1.3   An “Affiliated Company” of AIG Investments Europe means any person which
is an “associated company” of AIG Investments Europe for the purposes of section
416 of the Income and Corporation Taxes Act 1988. “Affiliated Companies” shall
be construed accordingly.

 

1.4   “Ancillary Services” has the meaning given in Section 6.6.

 

1.5   “Associated Person” means any of AIG Investments Europe’s or its
Affiliated Companies’ employees, officers or directors.

 

1.6   “Authorized Person” means a person duly authorized by IPCRe in connection
with instructions and communications in relation to this Agreement.

 

1.7   The “Custodian” means the person(s) appointed by IPCRe and notified to AIG
Investments Europe, who will act as custodian(s) of the investments from time to
time comprised in the Portfolio.

 

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1.8

 

The “Effective Date” of this Agreement is 20th December 2007.

 

1.9   “Eligible Counterparty” has the meaning given in the FSA Rules.

 

1.10   “Execution Policy” means AIG Investments Europe’s policy relating to the
execution of orders and decisions to deal on behalf of clients, as required by
the FSA Rules, the first version of which is attached to this Agreement as
Schedule 5.

 

1.11   “Execution Policy Notice” has the meaning given in Section 11.2.

 

1.12   The “FSA” means the UK Financial Services Authority and any replacement
or successor body.

 

1.13   The “FSA Rules” means the rules made by the FSA under the Financial
Services and Markets Act 2000 as set out in the FSA Handbook.

 

1.14   The “Guidelines” means the general instructions and guidelines which
shall be agreed to in writing between AIG Investments Europe and IPCRe from time
to time, the first version of which appears in Schedule 3 hereto.

 

1.15   “In House Funds” means collective investment schemes of which AIG
Investments Europe and/or an Affiliated Company is the manager or investment
adviser.

 

1.16   “Initial Composition” and “Initial Value” means respectively the
composition and value of the assets (collectively and individually) compromising
the Portfolio at the time when AIG Investments Europe first assumes management
of the Portfolio.

 

1.17   “Instruction” means any instruction given or which purports to have been
given by an Authorized Person in accordance with Schedule 1.

 

1.18   “Liability” means any liability, damage, loss, cost, claim or expense of
any kind or nature, whether direct, indirect, special, consequential or
otherwise.

 

1.19   “Management Fee” has the meaning given in Section 9.1.

 

1.20   “MiFID” means Markets in Financial Instruments European Union Directive
2004/39/EC.

 

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1.21   “MTF” or “Multilateral Trading System” means a multilateral system set up
in accordance with MiFID, which brings together multiple buying and selling
interests in financial instruments in accordance with non-discretionary rules in
a way that results in a contract.

 

1.22   The “Objectives” means the investment objectives which shall be agreed to
in writing between AIG Investments Europe and IPCRe from time to time the first
version of which appears in Schedule 3 hereto.

 

1.23   “Portfolio Market Value” means the value given to all cash, constituent
securities and other financial instruments comprising the given portfolio.

 

1.24   “Professional Client” prior to 1 November 2007, means “intermediate
customer” as defined in the FSA Rules, and from 1 November 2007 has the meaning
given in the FSA Rules.

 

1.25   The “Portfolio” means any portfolio or portfolios of cash, securities,
and/or other assets managed by AIG Investments Europe on IPCRe’s behalf under
this Agreement and subject to the Guidelines.

 

1.26   “Regulated Market” means a multilateral system which brings together or
facilitates the bringing together of multiple buying and selling interests in
financial instruments in accordance with non-discretionary rules in a way that
results in a contract in respect of the financial instruments admitted to
trading under its rules and/or systems and which is authorized and functions
regularly in accordance with the requirements of MiFID.

 

1.27   “Security” or “Securities” means cash, securities, derivatives and/or
other assets.

 

1.28   “Scheme” has the meaning given in Section 3.4.

 

1.29   “Transaction Expenses” has the meaning given in Section 9.3.

 

2.   Appointment

 

2.1   IPCRe hereby appoints AIG Investments Europe as investment manager, and as
its agent and attorney-in-fact, and authorizes AIG Investments Europe to
exercise the investment discretion described below with respect to the Portfolio
and to execute and deliver all documentation, on IPCRe’s behalf, necessary to
facilitate investment in Securities for the Portfolio with effect from the
Effective Date, and AIG Investments Europe hereby accepts this appointment
subject to the terms of this Agreement.

 

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3.   Regulation

 

3.1   AIG Investments Europe is authorized and regulated by the Financial
Services Authority. AIG Investments Europe will apply this Agreement at all
times in the management of the Portfolio, except where AIG Investments Europe
and IPCRe have both agreed to vary them in any manner permitted under the FSA
Rules. Nothing in the agreement shall exclude or restrict any liability or duty
which AIG Investments Europe may have to IPCRe arising under the Financial
Services and Markets Act 2000, any rules and regulations made under that act,
the Pensions Act 1995 or the FSA Rules, unless and to the extent that such
exclusion or restriction is permitted thereby.

 

3.2   IPCRe is categorized as a Professional Client under the FSA Rules. AIG
Investments Europe is permitted only to provide services to Professional Clients
and Eligible Counterparties. It is open to IPCRe to request recategorisation as
an Eligible Counterparty, which would confer a lower level of regulatory
protection on IPCRe.

 

3.3   AIG Investments Europe has established procedures for consideration of
complaints by IPCRe. All formal complaints should in the first instance be made
in writing to the compliance officer of AIG Investments Europe, who is
responsible for complaints procedures, at the address of AIG Investments Europe.

 

3.4   The U.K. Financial Services Compensation Scheme (the “Scheme”) may apply
if AIG Investments Europe cannot meet claims against it, but it is limited in
scope and may not apply to IPCRe. If the Scheme is applicable, compensation is
limited to 100% of the first £30,000 and 90% of the next £20,000, so the maximum
compensation is £48,000. Details regarding the scheme are in the compensation
sourcebook available on www.fsa.co.uk.

 

4.   IPCRe’s Representations and Warranties

 

4.1   IPCRe hereby represents and warrants to AIG Investments Europe as follows:

 

  4.1.1 IPCRe has the power and authority to execute and deliver this Agreement
and to consummate the transactions contemplated hereby. This Agreement has been
duly authorized, executed and delivered by IPCRe and constitutes a legal, valid
and binding obligation of IPCRe, enforceable against IPCRe in accordance with
its terms. No consent of any person, and no license, permit, approval or
authorization of, exemption by, report to, or registration, filing or
declaration with, any governmental authority is required by IPCRe in connection
with the execution, delivery and performance of this Agreement other than those
already obtained.

 

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  4.1.2 Except as otherwise expressly stated in the Guidelines or herein, IPCRe
warrants to AIG Investments Europe that the Portfolio is free from any lien,
charge or other encumbrance, and that IPCRe has full and unfettered powers to
engage AIG Investments Europe to manage the Portfolio and the authority to
execute and deliver this Agreement and to consummate the transactions
contemplated hereby, and that the signatories to this Agreement are Authorized
Persons.

 

  4.1.3 The execution, delivery and performance of this Agreement by IPCRe will
not violate any provision of any law or regulation binding on IPCRe, or any
order, judgment or decree of any court or government authority binding on IPCRe
or the memorandum of association or bye-laws or any other governing document of
IPCRe, or any material contract, indenture or other agreement, instrument or
undertaking to which IPCRe is a party or by which IPCRe or any of its assets may
be bound, or require the creation or imposition of any lien on its property,
assets or revenues.

 

  4.1.4 The signatories to this Agreement are all Authorized Persons, the list
of signatories and signatures attached hereto as Schedule 1 which is certified
by IPCRe’s secretary, or other appropriate person, constitutes the valid
signatories and signatures of Authorized Persons, and, promptly after any change
therein, IPCRe will send AIG Investments Europe a revised list of Authorized
Persons and evidence of the authority for such change.

 

  4.1.5 IPCRe warrants that any information which it has provided to AIG
Investments Europe in relation to its status, residence and domicile for
taxation purposes and any other matter relevant to the management of the
Portfolio is complete and correct, and agrees to provide any further information
properly required by any competent authority.

 

  4.1.6 IPCRe represents and warrants that it fully understands that the
investment of funds authorized hereunder may lead to loss as well as profit.

 

  4.1.7

IPCRe acknowledges that AIG Investments Europe has not provided and will not
provide any tax advice to IPCRe in relation to its services under this

 

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Agreement, and that AIG Investments Europe has made no representations as to any
individual tax consequences for it of entering into this Agreement or any
transaction entered into under it.

 

  4.1.8 IPCRe acknowledges that AIG Investments Europe does not accept any
responsibility with respect to, and shall not be liable for the acts and
defaults of, the Custodian or any of its nominees.

 

5.   AIG Investments Europe’s Representations and Warranties

 

5.1   AIG Investments Europe hereby represents and warrants to IPCRe as follows:

 

  5.1.1 AIG Investments Europe has the power and authority to execute and
deliver this Agreement and to consummate the transactions contemplated hereby.
This Agreement has been duly authorized, executed and delivered by AIG
Investments Europe and constitutes a legal, valid and binding obligation of AIG
Investments Europe, enforceable against AIG Investments Europe in accordance
with its terms. No consent of any person, and no license, permit, approval or
authorization of, exemption by, report to, or registration, filing or
declaration with, any governmental authority is required by AIG Investments
Europe in connection with the execution, delivery and performance of this
Agreement by AIG Investments Europe, other than those already obtained.

 

  5.1.2 The execution, delivery and performance of this Agreement by AIG
Investments Europe will not violate any provision of any law or regulation
binding on AIG Investments Europe, or any order, judgment or decree of any court
or government authority binding on AIG Investments Europe or the memorandum or
articles of association of AIG Investments Europe, or any material contract,
indenture or other agreement, instrument or undertaking to which AIG Investments
Europe is a party or by which it or its assets may be bound, or require the
creation or imposition of any lien on its property, assets or revenues.

 

6.   Scope of Authorization.

 

6.1  

AIG Investments Europe will provide general investment advisory and portfolio
management services in relation to all classes of investments on the terms set
out in this Agreement including transactions in collective investment schemes
and the acceptance of

 

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placings, underwritings and sub-underwritings of any investments. AIG
Investments Europe shall act as the investment adviser to IPCRe, and shall,
continuously during the term of this Agreement, manage the Portfolio for IPCRe
with a view to meeting the Objectives and within the Guidelines, if any. In
connection therewith, AIG Investments Europe shall, on consultation with IPCRe,
have power to supervise and direct the investment and reinvestment of the
Securities of the Portfolio including allocations to passive Equity index funds
and engage in such transactions on behalf of IPCRe as AIG Investments Europe may
deem appropriate, subject only to this Agreement and any Guidelines.

 

6.2   AIG Investments Europe may invest any part of the Portfolio in one or more
In-House Funds which invest in and/or take exposure to equities and/or
equity-related derivatives in accordance with the Guidelines (each an “Equity In
House Fund”). The manager of the Equity In- House Fund shall levy a fee or
charge which shall be paid out of the assets of the Equity- In House Fund (see
section 8.1.5) subject to the fee offset as described in paragraph 8.5.1 and in
Schedule 2.

 

6.3   AIG Investments Europe may instruct the Custodian to effect settlement of
purchases and sales of investments on IPCRe’s behalf in AIG Investments Europe’s
and has discretion to make full allocation within the guidelines stated under
Schedule 3 (paragraph ) within each asset class. Any allocation between asset
classes may only be made by AIG Investments Europe following consultation and
approval with the investment committee of IPCRe.

 

6.4   The Securities in the Portfolio shall be held by such institutions as
notified by IPCRe to AIG Investments Europe from time to time. IPCRe understands
and acknowledges that (i) AIG Investments Europe shall at no time have custody
or physical control of the Portfolio, (ii) AIG Investments Europe may give
instructions to the Custodian, in writing, by electronic means, by telephone,
orally or by such other means as AIG Investments Europe may agree with the
Custodian from time to time, (iii) IPCRe shall procure and shall be solely
responsible for procuring that Custodian complies with such instructions and
(iv) IPCRe shall instruct the Custodian to provide AIG Investments Europe with
such periodic reports concerning the status of the Portfolio as AIG Investments
Europe may reasonably request from time to time. IPCRe will not change the
Custodian without giving AIG Investments Europe reasonable prior notice of its
intention to do so together with the name and other relevant information with
respect to the new Custodian. IPCRe undertakes that, without AIG Investments
Europe’s prior written consent, it will not dispose of, encumber or otherwise
deal with any of the assets in the Portfolio before the relevant assets have
been withdrawn from the Portfolio.

 

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6.5   AIG Investments Europe may direct the Custodian to retain a lien or
security interest over any assets of the Portfolio to the extent that any costs,
losses or claims detailed in the Agreement remain unpaid by IPCRe.

 

6.6   AIG Investments Europe, may, in its discretion from time to time (at its
expense), retain or otherwise avail itself of the services or facilities of
other persons or organizations (which may include any of its Affiliated
Companies) for the purpose of providing AIG Investments Europe (and/or IPCRe)
with statistical and other factual information (e.g., advice regarding economic
factors and trends), or such other general information or general advice as AIG
Investments Europe may deem necessary, appropriate, or convenient in support of
the discharge of AIG Investments Europe’s investment management obligations
hereunder (“Ancillary Services”). The parties agree that (i) AIG Investments
Europe is under no obligation to seek out any Ancillary Services, and (ii) any
Ancillary Services would be supplemental to AIG Investments Europe’s investment
management services, and are wholly apart from, and are unrelated to, matters
that would give rise to Transaction Expenses (as described in, and covered by,
Section 9.3 hereof).

 

6.7   AIG Investments Europe is authorized, and has full discretion, to delegate
any of its investment management responsibilities, powers, discretions, duties
and authority set forth herein (including the power to sub-delegate such
investment management responsibilities, powers, discretions, duties and
authority) to, or otherwise to utilize the investment management services of,
any Affiliated Company, provided, that, AIG Investments Europe will be fully
accountable to IPCRe for any acts or omissions of its Affiliated Company
pursuant to such an arrangement, as if such acts or omissions were its own, and
provided further that any compensation payable to such Affiliated Company for
such investment management services shall be borne by (and paid by) AIG
Investments Europe.

 

6.8   AIG Investments Europe may, where reasonable, employ agents (including
Affiliated Companies) to perform any administrative, dealing or ancillary or
other services in connection with AIG Investments Europe performing its services
under this Agreement.

 

6.9   Schedule 6 sets out a general description of the nature and risks of
Securities which may form part of the Portfolio. This is not an exhaustive
description of those risks and if in any doubt as to whether to include a
particular type of investment within the Guidelines, IPCRe may seek investment
advice prior to finalising the Guidelines.

 

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7.   Valuations and Reports

 

7.1   The Initial Composition and Initial Value of the Portfolio will be
notified to IPCRe as soon as reasonably practicable. The basis of all valuations
will be as stated in the first such statement or as otherwise notified to IPCRe
from time to time. AIG Investments Europe will not provide information about
executed transactions on a transaction-by-transaction basis.

 

7.2   IPCRe will notify AIG Investments Europe in writing, or cause to be
notified to AIG Investments Europe in writing, of any withdrawals from,
increases in and other movements into and out of the Portfolio in such detail as
will enable AIG Investments Europe to keep an accurate and up-to-date record of
the composition of the Portfolio.

 

8.   Material Impacts and Conflicts

 

8.1   Subject to any provisions in the Guidelines, AIG Investments Europe and
any Affiliated Company may effect transactions in which AIG Investments Europe
or an Affiliated Company has directly or indirectly a material interest or a
relationship of any description with another party which may involve a potential
conflict with AIG Investments Europe’s duty to IPCRe, provided that such
transactions are effected on terms which are not materially less favourable to
IPCRe than if the conflict or potential conflict had not existed. In particular,
such potential conflicting interests or duties may arise because:

 

  8.1.1 AIG Investments Europe or an Affiliated Company undertakes investment
management activities for another investor or investors with interests in such
investments. AIG Investments Europe has procedures in place with a view to
ensuring that no single investor is favoured over another when determining which
investors enter into a particular transaction;

 

  8.1.2 the transaction is in securities issued by an Affiliated Company or an
investor in AIG Investments Europe or in its Affiliated Companies;

 

  8.1.3 the transaction is in relation to an investment in respect of which AIG
Investments Europe or an Affiliated Company may benefit from a commission, fee,
mark-up or mark-down and/or AIG Investments Europe or an Affiliated Company may
also be remunerated by a counterparty to any such transaction and/or an
Affiliated Company may have arrangements relating to marketing or otherwise. AIG
Investments Europe maintains a policy that whether or not an Affiliated Company
receives a commission or fee is not taken into account when determining whether
to make an investment;

 

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  8.1.4 AIG Investments Europe may from time to time temporarily invest cash
balances in the Portfolio in any money market or liquidity In House Fund
(including with respect to any portion of the Portfolio custodied in the United
States or invested in U.S. securities). In connection with investments in such
money market or liquidity funds, IPCRe understands that Portfolio assets
invested will be included in determining the fee payable to AIG Investments
Europe under this Agreement;

 

  8.1.5 IPCRe hereby authorizes AIG Investments Europe to invest all or any
portion of the Portfolio in any commingled vehicle whose investment strategy is
generally consistent with the Guidelines, whether advised or managed by AIG
Investments Europe or its Affiliate Companies (“Managed Funds”) or by a third
party manager. IPCRe acknowledges that AIG Investments Europe and/or any of its
Affiliate Companies may receive fees directly from Managed Fund(s) for the
discretionary management, advisory and administrative services provided thereto.
To the extent that AIG Investments Europe receives such fees (from the Managed
In-House Funds), these fees will be set-off against such fee income as is due to
AIG Investments Europe in respect of managing the entire Portfolio so that AIG
Investments Europe receives only its fee income entitlement as determined at the
Portfolio level. IPCRe acknowledges that investment in any commingled vehicles
advised by a third-party manager will be subject to the standard fees and
charges of such vehicles in addition to the management fee payable to AIG
Investments Europe under this Agreement, unless otherwise agreed between the
parties.

 

8.2   AIG Investments Europe has instituted procedures, designed to ensure
independence in the exercise of its investment discretion and provision of
advice for or to clients. This includes restricting access (through the use of
“Information Barriers”) to confidential information for employees who are
involved in the exercise of investment discretion for or provision of advice to
IPCRe or any other client, in situations where there may be a conflict of
interest. IPCRe agrees that in exercising investment discretion for or providing
advice to IPCRe, AIG Investments Europe shall not be obliged to take into
account any information where the persons involved in the exercise of investment
discretion or provision of advice to or for IPCRe are prevented from having
access to the information by AIG Investments Europe’s Information Barriers
procedures or where AIG Investments Europe is otherwise prohibited by law or
regulatory obligations from taking that information into account. AIG
Investments Europe shall not be obliged to disclose any information which it is
prohibited from disclosing or which in its reasonable opinion would be
inappropriate to disclose given its legal and regulatory obligations. This
Section 8.2 shall apply, but not be limited to, the following situations:

 

  8.2.1 a transaction in the securities of a company for which AIG Investments
Europe or an Affiliated Company has underwritten, managed or arranged an issue
within the period of 12 months before the date of the transaction;

 

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  8.2.2 a transaction which relates to securities in respect of which AIG
Investments Europe or an Affiliated Company or a director or employee of AIG
Investments Europe or an Affiliated Company is contemporaneously trading or has
traded on its own account or has either a long or short position;

 

  8.2.3 one of AIG Investments Europe’s directors or employees or those of an
Affiliated Company holds or deals in securities of or is otherwise interested in
any company in relation to the securities of which AIG Investments Europe or an
Affiliated Company makes a recommendation and/or effects a transaction.

 

8.3   Neither AIG Investments Europe nor any Affiliated Company shall be liable
to account to IPCRe for any profit, commission or remuneration made or received
from or by reason of transactions of the type referred to in Section 8.1 or
Section 8.2 or any connected transactions.

 

8.4   AIG Investments Europe will normally act as the agent of IPCRe, who will
therefore be bound by its actions under this Agreement. To the extent that any
fiduciary or equitable duties arise as a result of the services to be provided
hereunder such duties shall not prevent or hinder the AIG Investments Europe, or
any Affiliated Company, in effecting transactions with or for IPCRe.

 

9.   Fees and Expenses

 

9.1   AIG Investments Europe’s management fees for services rendered hereunder
(the “Management Fee”) shall be calculated and paid in accordance with the
Schedule of Fees attached hereto as Schedule 2 (as same may be amended, from
time to time, pursuant to this Section 9), which will also state whether or not
interest is payable on overdue management fees.

 

9.2   AIG Investments Europe and/or its Affiliate Companies may take fees from
third parties for services provided by AIG Investments Europe and/or its
Affiliate Companies to such third parties relating to a transaction in which
IPCRe has participated, or a security or portfolio of securities in which IPCRe
is invested, in all cases, except as otherwise limited by applicable law and the
FSA Rules. Details of such fees will be provided to IPCRe upon request.

 

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9.3   IPCRe shall be separately responsible for (and bear the cost of) all
expenses (“Transaction Expenses”) related to the acquisition, disposition,
and/or custody of all transactions (and potential transactions), including, by
way of example and without limitation, brokerage commissions, taxes, custodian
fees, legal fees and expenses (whether associated with the transaction itself or
arising from any subsequent action undertaken to enforce the rights of IPCRe
with respect to the transaction), accounting and/or tax planning fees and
expenses, consulting and experts fees and expenses, and any other
transaction-related expenses (irrespective of whether or not the transaction is
consummated), and IPCRe hereby authorizes AIG Investments Europe to incur and to
pay such expenses out of the Portfolio, as deemed appropriate by AIG Investments
Europe.

 

9.4   Consistent with applicable law, IPCRe hereby authorizes AIG Investments
Europe to debit its fees and expenses directly from the Portfolio, and shall
instruct the Custodian to facilitate such debits.

 

9.5   Save as expressly provided in Schedule 2, AIG Investments Europe shall not
be obliged to account to IPCRe for any financial benefit derived by AIG
Investments Europe or any of its Affiliated Companies in connection with any
transaction arranged by AIG Investments Europe pursuant to this Agreement,
including any commissions received by AIG Investments Europe or any Affiliated
Companies in respect of any transaction carried out for the Portfolio.

 

10.   Acknowledgments and Consents.

IPCRe hereby acknowledges and consents to the following:

 

10.1   AIG Investments Europe and its Affiliate Companies may disclose the
identity of IPCRe as part of any representative list of clients and in the
course of performing its duties as investment manager. Neither AIG Investments
Europe nor any Affiliated Company is obliged to disclose to IPCRe or to take
into consideration information either:

 

  10.1.1 the disclosure of which by AIG Investments Europe or the Affiliated
Company to IPCRe would or might be a breach of duty or confidence to any other
person; or

 

  10.1.2 which comes to the notice of an employee, officer or agent of AIG
Investments Europe’s or of any Affiliated Company, but does not come to the
actual notice of those individuals responsible for investment decisions on
IPCRe’s behalf.

 

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10.2   IPCRe has been notified of and agreed that it will be treated as a
Professional Client unless parties to this Agreement agree otherwise. IPCRe
Limited is required to notify AIG Investments Europe immediately of any change
that could affect its categorisation.

 

10.3   AIG Investments Europe acts as adviser to other clients and may give
advice, and take action, with respect to any of those which may differ from the
advice given, or the time or nature of action taken, with respect to the
Portfolio.

 

10.4   Affiliated Companies of AIG Investments Europe and officers, directors
and employees of AIG Investments Europe and such Affiliated Companies of AIG
Investments Europe may engage in transactions, or cause or advise other
customers to engage in transactions, which may differ from or be identical to
transactions engaged in by AIG Investments Europe for the Portfolio or recommend
any transaction which any of such Affiliated Companies or any of the officers,
directors or employees of AIG Investments Europe or such Affiliated Companies
may engage in for their own accounts or the account of any other customer.

 

10.5   To the extent permitted by law, AIG Investments Europe shall be permitted
to bunch or aggregate orders for the Portfolio with orders for other accounts
without prior reference to IPCRe or other customers. AIG Investments Europe will
do so only where it is likely that the aggregation will not work to the
disadvantage of each of the customers concerned. However the effect of
aggregation may work on some occasions to a customer’s disadvantage.

 

10.6   AIG Investments Europe shall use its diligent efforts to allocate or
rotate investment opportunities where there is a limited supply of a Security.
IPCRe understands, however, that, in spite of such efforts, AIG Investments
Europe cannot always assure equality among all accounts and customers.

 

10.7   By reason of AIG Investments Europe’s investment management activities
for IPCRe and for other clients, and other activities of its Affiliated
Companies, AIG Investments Europe may acquire confidential information regarding
certain entities and Securities and/or otherwise be restricted from initiating
transactions in certain Securities. IPCRe acknowledges and agrees that AIG
Investments Europe will not be free to divulge to IPCRe, or to act upon, any
such confidential information with respect to AIG Investments Europe’s
performance of this Agreement and that, due to such a restriction, AIG
Investments Europe may not initiate a transaction that AIG Investments Europe
otherwise might have initiated, but for the conflict of interest arising from
such confidential information. To the extent that AIG Investments Europe
receives any confidential information in relation to IPCRe by reason of its
investment management activities it will not be free to divulge or act upon such
confidential information.

 

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10.8   Each party shall promptly notify the other of any facts or circumstances
or any change therein that may, directly or indirectly, affect the status or
management of the Portfolio by AIG Investments Europe, including, without
limitation, any change in the status of any of the representations or warranties
provided in Sections 4 and 5 hereof. IPCRe shall provide AIG Investments Europe
with such other relevant information as AIG Investments Europe may reasonably
request from time to time in order to enable AIG Investments Europe to comply
with its regulatory and contractual obligations or such further information as
may be required by any authority, in each case promptly following such request.
IPCRe acknowledges that failure to provide such information may adversely affect
AIG Investments Europe’s ability to provide services to IPCRe and the quality of
such services.

 

10.9   IPCRe acknowledges that the Guidelines apply at the time of purchase of
Securities for the Portfolio only, and failure to comply with any specific
guideline or restriction contained therein because of market fluctuation,
changes in the capital structure of any Portfolio company, ratings agency or
credit ratings changes or withdrawals or other events outside of AIG Investments
Europe’s control will not be deemed a breach of the Guidelines or this
Agreement.

 

10.10   IPCRe agrees that all transactions will be effected in accordance with
the rules and regulations of the relevant market, exchange or multilateral
trading facility or subject to the conditions applying to over the counter
transactions, and shall be settled where relevant in accordance with the rules
and regulations relating to the relevant settlement system and that AIG
Investments Europe may and is hereby expressly authorized to take all such steps
as may be required or permitted by such rules, regulations and conditions and/or
by market practice.

 

10.11   In the interests of the proper management and administration of the
Portfolio and in order to bring new products or services of AIG Investments
Europe or Affiliated Companies to the attention of IPCRe, AIG Investments
Europe, its representatives or employees, may wish to call upon or communicate
with IPCRe by telephone, email or personal visit or otherwise communicate with
IPCRe without express invitation. IPCRe consents to such communications.

 

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10.12   Should AIG Investments Europe transact in futures contracts for the
Portfolio, the following shall apply:

IPCRe understands that pursuant to an exemption from the commodity futures
trading commission (“CTFC”) in connection with accounts of qualified eligible
persons, this account document is not required to be, and has not been filed
with, the CTFC. The CTFC does not pass upon the merits of participating in a
trading program or upon the adequacy or accuracy of the commodity trading
advisor disclosure. Consequently, the CTFC has not reviewed or approved this
trading program or this account document.

 

11.   Execution of Transactions.

 

11.1   AIG Investments Europe may place orders for the execution of transactions
with or through such brokers, dealers or banks as AIG Investments Europe may
select in its sole discretion, and may, consistent with seeking best execution
and in compliance with applicable laws and regulations including the FSA Rules,
pay a commission on transactions which may be greater than the amount of the
commission another broker or dealer might have charged, provided that AIG
Investments Europe determines in good faith that such amount of commission was
reasonable in relation to the value of the services provided viewed in terms of
that particular transaction or the overall responsibilities with respect to all
the accounts as to which investment discretion was exercised, provided that they
are directly relevant to, and are used to enhance, the provision to IPCRe of
investment management services, advice on dealing in, or on the value of, any
designated investment, custody services relating to designated investments
belonging to, or managed for, customers, or services relating to the valuation
or performance measurement of portfolios.

 

11.2   Details of AIG Investments Europe’s current Execution Policy are attached
as Schedule 5 (the “Execution Policy Notice”). IPCRe hereby confirms that it has
read and understood the Execution Policy Notice and agrees to AIG Investments
Europe’s Execution Policy. In particular IPCRe agrees that AIG Investments
Europe may trade outside of a Regulated Market or MTF. In effecting transactions
for the Portfolio, AIG Investments Europe will at all times comply with its
Execution Policy and in particular will act in the best interests of IPCRe and
comply with any applicable obligations regarding best execution under the FSA
Rules. Specific instructions from IPCRe in relation to the execution of orders
may prevent AIG Investments Europe from following its Execution Policy in
relation to such orders in respect of the elements of execution covered by the
instructions. AIG Investments Europe may (subject to its Execution Policy) deal
on such markets, exchanges, multilateral trading facilities and otherwise and
with such counterparties as it sees fit.

 

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11.3   IPCRe Ltd instructs AIG Investments Europe not to make public IPCRe Limit
Orders in respect of shares admitted to trading on a regulated market which are
not immediately executed under prevailing market conditions.

 

11.4   IPCRe hereby authorizes AIG Investments Europe to direct its Affiliated
Companies to effect Securities transactions for the Portfolio, including over an
exchange, and such Affiliated Companies may retain compensation in connection
with effecting Securities transactions for the Portfolio. AIG Investments Europe
may act as investment adviser in relation to a transaction to be effected on
IPCRe’s behalf in which an Affiliated Company of AIG Investments Europe acts as
broker for both the Portfolio and another person on the other side of such
transaction (an “agency cross transaction”) or, to the extent permitted by
applicable law, as principal (in which case such Affiliated Company may charge
IPCRe its customary mark-up). IPCRe understands that in connection with any such
agency cross transaction, such Affiliated Company will receive commissions from
both parties to the transaction and that such Affiliated Companies may have a
potentially conflicting division of loyalties and responsibilities regarding the
parties to the transaction. IPCRe hereby consents to any agency cross
transaction effected by AIG Investments Europe to which IPCRe may be a party and
understand that such consent will remain in full force and effect until such
time as IPCRe notifies AIG Investments Europe in writing of the revocation
thereof. AIG Investments Europe is subject at all times to its duty to seek best
execution.

 

12.   IPCRe’s Liabilities

 

12.1   Except insofar as the same may result from the negligence, wilful default
or fraud of AIG Investments Europe or its Affiliated Companies or any Associated
Person, IPCRe shall indemnify AIG Investments Europe and its Associated Persons
against and hold AIG Investments Europe and its Associated Persons harmless
against all claims brought or established against AIG Investments Europe or its
Associated Persons by third parties (other than AIG Investments Europe’s
Affiliated Companies or any of their officer’s or employees), and against all
Liability which AIG Investments Europe or its Associated Persons may suffer or
incur, arising out of or in connection with (i) the lawful and proper exercise
of AIG Investments Europe’s duties under this Agreement or (ii) as a result of
any party claiming to be entitled to investments which form part of the
Portfolio; provided in each case that AIG Investments Europe (a) has taken all
reasonable steps to avoid or minimise such claims; (b) has informed IPCRe of any
such claims in respect of which an indemnity is sought under this Agreement as
soon as reasonably practicable; and (c) keeps IPCRe informed of, and acts
reasonably in relation to any request from IPCRe in relation to, any steps taken
or to be taken in respect of such claims.

 

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13.   AIG Investments Europe’s Liabilities

 

13.1   AIG Investments Europe shall not be responsible for the solvency of or
the performance of the obligations of any third party bank, clearing
organization, broker, intermediary, nominee or agent appointed or employed by
AIG Investments Europe in good faith for the performance of its duties but AIG
Investments Europe shall give such assistance as IPCRe may reasonably require to
exercise such rights as AIG Investments Europe may have against such person in
its capacity as an agent for IPCRe in the event of the insolvency of any of the
above (or the failure of the same to properly perform such obligations).

 

13.2   Any liability which AIG Investments Europe has arising out of or in
connection with its services and activities, whether such liability arises under
any express or implied term of this Agreement, in tort (including without
limitation negligence), for misrepresentation, for breach of any duty imposed by
law, or in any other way shall be limited as follows:

 

  13.2.1 AIG Investments Europe shall not incur any liability save to the extent
that such liability results from its negligence or wilful default or fraud;

 

  13.2.2 AIG Investments Europe shall not incur any liability for any indirect,
special or consequential loss of any kind (even if AIG Investments Europe knows
of the possibility of such losses or damages and regardless of the type of
action in which any claim may be brought);

 

  13.2.3 AIG Investments Europe shall not incur any liability for any loss of
profits, goodwill, business or anticipated savings (in either case, either
direct or indirect), which may be incurred, even if AIG Investments Europe knows
of the possibility of such losses or damages.

 

13.3   AIG Investments Europe only assumes duties to IPCRe.

 

13.4   If AIG Investments Europe and any other person would be jointly and/or
severally liable in respect of any Liabilities, the amount recoverable from AIG
Investments Europe shall be limited to such amount as is just and equitable
having regard to the extent of AIG Investments Europe’s responsibility for the
loss or damage in question.

 

13.5  

IPCRe agrees to notify AIG Investments Europe as soon as reasonably practicable
if IPCRe has any concerns arising in connection with AIG Investments Europe’s
services so that AIG Investments Europe has an opportunity to deal with the
issue raised. In any event AIG Investments Europe shall on no account be liable
for any Liabilities suffered or

 

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incurred unless AIG Investments Europe is given written notice of any potential
claim on or before the date which is 12 months after the date on which the
claimant became aware of the specific act, fact, circumstance or event which
gave rise to the claim or, if earlier, the date on which the claimant ought
reasonably (having regard to all the circumstances) to have become so aware.

 

13.6   IPCRe acknowledges and agrees that AIG Investments Europe alone, and not
any Associated Person, is responsible for its activities and the provision of
its services under this Agreement and IPCRe agrees that it will not bring any
claim or take any action against any Associated Person in respect of any acts,
omissions or events in connection with this Agreement and waives any rights that
it may have to do so except where such a claim may not be excluded by law.

 

13.7   No warranty is given by AIG Investments Europe as to the performance or
profitability of the Portfolio or any part of it.

 

13.8   Subject to Section 13.2, AIG Investments Europe will not be liable in
relation to any actions or omissions of, or the negligence, wilful default or
fraud of, the Custodian or any of its nominees.

 

13.9   AIG Investments Europe shall be fully protected in acting and relying
upon any Instruction, written advice, certificate, notice, instruction, request
for other paper or document which AIG Investments Europe in good faith believes
to be genuine and to have been signed or presented by an Authorized Person or
other proper party or parties, and may assume that any person purporting to give
such advice or other paper or document has been duly authorized to do so unless
contrary Instructions have been delivered to AIG Investments Europe by IPCRe.

 

13.10   Any benchmarks and/or targeted rates of return (if any) associated with
the investment program being provided pursuant to this Agreement or that may be
referred to in the Objectives or Guidelines are for measurement purposes only,
and any such specific investment objectives are targets only, and AIG
Investments Europe shall have no duty to IPCRe or to any third party to meet or
outperform and accordingly shall have no liability for failure to meet or
outperform any such benchmark, targeted rate of return, or investment objective.

 

13.11   While AIG Investments Europe will make every effort to fulfil its
obligations to IPCRe, exceptional circumstances may occur from time to time
where for reasons beyond AIG Investments Europe’s control or reasonable
foresight it may be unable to do so (as a result of an Act of God, force majeure
or otherwise) and in such circumstances AIG Investments Europe shall not be
liable for any Liability suffered as a result of the non-fulfilment of any such
obligations.

 

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13.12   Noting in this Agreement shall be construed as seeking to exclude or
restrict:

 

  13.12.1 any liability AIG Investments Europe may have as a matter of law for
fraud or fraudulent misrepresentation;

 

  13.12.2 any liability for death or personal injury resulting from negligence.

This does not in any way confer greater rights than would otherwise arise as a
matter of law.

 

14.   Term and Termination of Agreement.

 

14.1   This Agreement may be terminated by IPCRe at any time by written notice
to AIG Investments Europe. AIG Investments Europe may terminate this Agreement
on 30 days written notice to IPCRe or by immediate notice if required to do so
by a competent regulatory authority. The “Termination Date” shall herein be
understood to mean the date that AIG Investments Europe’s management of the
Portfolio terminates, and shall not mean the date of notice of termination. The
termination of the authority granted by this Agreement shall not in any way
affect any liability resulting from a transaction initiated prior to the
Termination Date. The Management Fee will be prorated to the Termination Date.

 

14.2   IPCRe will pay: fees due to AIG Investments Europe pro rata to the date
on which AIG Investments Europe ceases to act on IPCRe’s behalf; any additional
expenses necessarily incurred by AIG Investments Europe in terminating this
Agreement; and any losses necessarily realized in concluding outstanding
transactions.

 

14.3   This Agreement shall terminate immediately upon AIG Investments Europe
ceasing to be authorized under the Financial Services and Markets Act 2000 to
manage investments or upon the liquidation or appointment of a receiver or
administrator of AIG Investments Europe (other than for the purposes of
reconstruction previously approved in writing by IPCRe).

 

14.4   Termination will not in any event affect accrued rights or existing
commitments, or contractual provisions intended to survive termination, and will
be without penalty or other additional payment, save as provided in paragraph
14.2.

 

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14.5   Sections 3.2, 4.1.1, 5.1.1, 8, 9.3, 12, 14, 15, 19, and 23 will survive
termination of this Agreement.

 

15.   Governing Law; Submission to Jurisdiction.

 

15.1   This Agreement shall be governed and construed in accordance with the
laws of England and Wales. The parties submit to be exclusive jurisdiction of
the Court of England and Wales to settle any disputes or claims that arise out
of or in connection with the Agreement.

 

16.   Amendments

 

16.1   Subject to Section 16.2, no variations of this Agreement shall be
effective unless agreed in writing, signed by IPCRe and AIG Investments Europe
and expressed to be such a variation.

 

16.2   AIG Investments Europe may from time to time amend the Execution Policy
and IPCRe may from time to time amend the details in Schedule 1 by written
notice to the other party. Any amendments made pursuant to this Section 16.2
shall take effect as a variation of this Agreement from the date stated in the
relevant notice provided that no amendment shall take effect less than five
clear business days after the date on which such notice is issued.

 

17.   Entire Agreement

 

17.1   The relationship between IPCRe and AIG Investments Europe is as described
in this Agreement. This Agreement supersedes all previous agreements between the
parties hereto (if any) concerning such relationship. Neither party is relying
upon any representation, warranty, promise or assurance made or given by the
other party or any other person, whether or not in writing, at any time prior to
AIG Investments Europe’s appointment pursuant to this Agreement, which is not
expressly set out in this Agreement. This Section shall not exclude the
liability of any persons for fraud or fraudulent misrepresentation.

 

18.   Instructions and Communications

 

18.1   In the absence of negligence, wilful default or fraud by AIG Investments
Europe, AIG Investments Europe is authorized to rely on, may act on and treat as
fully authorized by IPCRe and IPCRe shall be bound by any Instruction.

 

18.2   Any Instructions received from IPCRe will be acknowledged by AIG
Investments Europe by acting upon them, except where in AIG Investments Europe’s
view any action required by an Instruction may not be practicable or might
involve any party in a breach of any law, rule or regulation.

 

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18.3   IPCRe consents to AIG Investments Europe and its Affiliated Companies
recording telephone conversations with IPCRe. IPCRe is advised that AIG
Investments Europe may record conversations without the use of a warning tone.

 

19.   Notices.

 

19.1   Any notice required to be in writing shall be addressed to AIG
Investments Europe’s address shown in Schedule 4. Any notice AIG Investments
Europe serves upon IPCRe and all communications which AIG Investments Europe is
required to send in writing to IPCRe under this Agreement will be addressed to
the address which IPCRe supplies to AIG Investments Europe for such purposes as
set out in Schedule 4 and any amendments or additions thereto.

 

19.2   All notices served hereunder shall be deemed served on the date of
delivery in the case of personal delivery or transmission by e-mail or
facsimile, on the day after posting in the case of prepaid first class
correspondence within the United Kingdom, and on the third day after posting in
the case of other correspondence sent by post.

 

20.   No Waiver

Neither the failure nor delay on the part of any party in exercising any right
or remedy under this Agreement shall operate as a waiver thereof, nor shall any
single or partial exercise of any right or remedy preclude any other or further
waiver of any right or remedy. No waiver hereunder shall be effective unless it
is authorized by the party asserted to have granted such waiver.

 

21.   Successors and Assigns

This Agreement is personal to the parties and shall not be capable of assignment
by them or of being transferred by them except where expressly agreed in writing
and signed by the parties. This Section shall not restrict AIG Investments
Europe’s right to appoint delegates or agents.

 

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22.   Counterparts

This Agreement may be executed in several counterparts, each of which shall be
deemed to be an original, and all of which, when taken together, shall
constitute one and the same instrument.

 

23.   Third Party Rights.

The Contracts (Rights of Third Parties) Act 1999 shall not apply to this
Agreement and accordingly no part of this Agreement shall be directly or
indirectly enforceable by any third party, nor are they intended to confer a
benefit on any third party, save that any clause which confers a benefit on an
Associated Person shall be enforceable by him/it accordingly, although AIG
Investments Europe and IPCRe shall remain free to vary or terminate this
Agreement without the consent of any such person.

Each of the parties hereto has caused this Agreement to be duly executed as of
the date indicated after its name to become effective as of the date first above
written.

 

AGREED TO AND ACCEPTED: IPCRE LIMITED By:  

/s/ James P. Bryce

Name:  

James P. Bryce

Title:  

Director and President

Date:  

January 9, 2008

AIG INVESTMENTS EUROPE LTD By:  

/s/ Monika M. Machon

Date:  

December 20, 2007

Name:  

Monika M. Machon

Title:  

Director

 

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