Till Capital Ltd.: Exhibit 4.8 - Filed by newsfilecorp.com





QUOTA SHARE RETROCESSION AGREEMENT


 

QUOTA SHARE RETROCESSION AGREEMENT 

TABLE OF CONTENTS 

	RECITALS
      	1
      
	ARTICLE
    1 – BUSINESS COVERED 	2
      
	ARTICLE
      2 – COMMENCEMENT AND TERMINATION 	2
      
	ARTICLE
      3 – COVER 	4
      
	ARTICLE
    4 – TERRITORY 	4
      
	ARTICLE
    5 – EXCLUSIONS 	4
      
	ARTICLE
    6 – DEFINITIONS 	5
      
	ARTICLE
    7 – PREMIUM 	5
      
	ARTICLE
      8 – MSRE RETROCESSION COMMISSION AND UNDERWRITING INCENTIVE 	5
      
	ARTICLE
      9 – ACCOUNTS, REPORTS, AND REMITTANCES 	5
      
	ARTICLE
      10 – LOSS SETTLEMENTS 	6
      
	ARTICLE
      11 – PROFIT COMMISSION SETTLEMENTS 	7
      
	ARTICLE
      12 – OFFSET 	8
      
	ARTICLE
      13 – NET RETAINED LIABILITY 	8
      
	ARTICLE
      14 – COLLATERAL 	8
      
	ARTICLE
      15 – FOLLOW THE SETTLEMENTS 	9
      
	ARTICLE
      16 – ACCESS TO RECORDS 	9
      
	ARTICLE
    17 – ARBITRATION 	11
      
	ARTICLE
    18 – INSOLVENCY 	12
      
	ARTICLE
      19 – GOVERNING LAW 	13
      
	ARTICLE
      20 – CURRENCY 	13
      
	ARTICLE
      21 – TAXES 	13
      
	ARTICLE
      22 – INDEMNIFICATION AND ERRORS AND OMISSIONS	14
      
	ARTICLE
      23 – REPRESENTATIONS, WARRANTIES, AND COVENANTS 	14
      
	ARTICLE
      24 – AMENDMENTS 	15
      
	ARTICLE
      25 – THIRD-PARTY RIGHTS 	15
      
	ARTICLE
      26 – NOTICES 	15
      
	ARTICLE
      27 – ASSIGNMENT 	16
      
	ARTICLE
      28 – COUNTERPARTS 	16
      
	ARTICLE
      29 – NO PARTNERSHIP 	16
      
	ARTICLE
    30 – WAIVER 	17
      
	ARTICLE
    31 – HEADINGS 	17
      
	ARTICLE
    32 – ENFORCEABILITY 	17
      
	ARTICLE
      33 – ENTIRE AGREEMENT 	17
      
	APPENDIX
      A – PARTICIPATING RETROCESSIONAIRES – PARTICIPATION SCHEDULE 	A-1
      
	APPENDIX
      B – DEFINITIONS 	B-1
      






 

QUOTA SHARE RETROCESSION AGREEMENT 
(the
“Agreement”)

Between 

MULTI-STRAT RE LTD., a special purpose insurer incorporated
in Bermuda
(the “Retrocedent”, hereinafter referred to as
“MSRE”)

And 

RESOURCE RE LTD., a Class 3A insurer incorporated in
Bermuda
(the “Retrocessionaire”, hereinafter referred to as “PRe”)


(MSRE and PRe are individually referred to hereinafter as
a
“Party” and collectively as the “Parties”) 

RECITALS 

	A. 	
      MSRE, as the Retrocedent, intends to retrocede to PRe, as
      the Retrocessionaire, a specified quota share portion of certain insurance
      and reinsurance business that MSRE assumes from other insurance and/or
      reinsurance companies or binding quotations in the market that meet the
      criteria for business that may be retroceded to PRe in accordance with the
      terms and conditions of this Agreement, in particular, the specifications
      provided to MSRE by PRe in Appendix A hereto (the “MSRE
    Assumptions”).

	 	 
	B. 	
      The Parties intend that MSRE will bear no credit or
      insurance risk, except as expressly set forth in this Agreement, and PRe
      will hold harmless and indemnify MSRE solely for PRe’s proportionate share
      of the MSRE Assumptions, as set forth in this Agreement.

	 	 
	C. 	
      The Parties intend that MSRE’s services under this
      Agreement will permit the Original Policies to be reinsured by MSRE
      pursuant to the agreements between MSRE and the Cedents (the “Cedent
      Reinsurance Agreement”), with MSRE then retroceding a portion of such
      Cedent Reinsurance Agreements to PRes as the MSRE Assumptions, in exchange
      for which MSRE will receive the MSRE Retrocession Commission and, as
      applicable, an Underwriting Performance Incentive, and will remit the
      Ceded Net Written Premium to PRe.



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	D. 	
      Appendix B hereto sets forth the definitions of certain
      terms used in this Agreement. Appendices A and B hereto are integral parts
      of this Agreement.



In consideration of the mutual covenants contained and on the
terms and conditions set forth in this Agreement, the Parties agree as follows:


ARTICLE 1 - BUSINESS COVERED 

MSRE retrocedes and PRe assumes the MSRE Assumptions during the
Agreement Year, as determined by MSRE in in accordance with the specifications
provided by PRe in Appendix A (the “Business Covered”), which Business Covered
is automatically binding on PRe without any further action by PRe except as
expressly provided in this Agreement and Appendix A hereto. 

ARTICLE 2 – COMMENCEMENT AND TERMINATION 

	A. 	
      This Agreement will be continuous and will take effect at
      12:01 A.M., Atlantic Time, July 1, 2014, and will apply to the Business
      Covered from the inception date of this Agreement through to June 30, 2015
      (the “Agreement Year”), and will remain in effect continuously until MSRE
      has fully performed it obligations thereunder.

	 	 	 
	B. 	
      PRe’s liability will commence simultaneously with that of
      MSRE, on a “Policies Attaching” basis, meaning that coverage applies as
      respects each Original Policy assumed by MSRE pursuant to a Cedent
      Reinsurance Agreement written or renewed on or after the inception date of
      this Agreement and prior to the date of Termination of this Agreement.
      This Agreement will apply to the Original Policy term, including the
      run-off period. Coverage provided under this Agreement will follow the
      same terms and conditions of the applicable Original Policy.

	 	 	 
	C. 	
      After the Agreement Year, this Agreement is renewable
      with the prior written consent of both Parties on an annual basis, and
      will remain in force until all risks associated with the Business Covered
      are (i) off-risk (meaning that there are no longer any obligations owed to
      the Cedent) or (ii) included in a commutation and/or loss portfolio
      transfer agreement executed between MSRE and PRe or between such other
      parties as the Parties may agree in writing.

	 	 	 
	D. 	
      In the event that any of the following circumstances
      occur, either Party may terminate this Agreement at any time by giving
      thirty (30) days prior written notice to the other Party (any such event,
      either on an individual basis or in concert with one or more such events,
      is referred to herein as a “Termination Event”):

	 	 	 
		(i) 	
      Either Party fails to make payment of any undisputed
      Balance under this Agreement when due, and fails to remit any such overdue
      payment within sixty (60) days of the due date of such
  payment.



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		(ii) 	
      A regulatory or other legal authority (a) orders either
      Party to cease writing, or renewing, insurance business, in total, or (b)
      withdraws, suspends, removes, makes conditional, or impairs either Party's
      respective right, or ability, to retrocede or assume the Business Covered,
      in total, under this Agreement.

	 	 	 
		(iii) 	
      Either Party merges or amalgamates with or becomes
      acquired or controlled directly or indirectly by any company, corporation,
      partnership, or individual(s) not controlling their respective operations
      at the inception of this Agreement (an acquisition or change in control
      will only have occurred if a person unaffiliated with the applicable Party
      directly or indirectly acquires fifty percent (50%) or more of the voting
      shares of such Party, or of any person owning or controlling such Party,
      or of shares convertible into fifty percent (50%) or more of such voting
      shares).

	 	 	 
		(iv) 	
      Either Party becomes insolvent or has been placed into
      liquidation or receivership (whether voluntary or involuntary) or
      proceedings have been instituted against such Party for the appointment of
      a receiver, liquidator, rehabilitator, conservator or trustee in
      bankruptcy, or other agent known by whatever name, to take possession of
      their respective assets or the control of their respective
    operations.

	 	 	 
		(v) 	
      Either Party fails to comply with Bermuda laws and
      regulations in a material respect, resulting in material economic harm to
      the other Party.

	 	 	 
		(vi) 	
      Any of the respective directors, officers, employees,
      and/or Agents of either Party acts, individually or in collusion with
      another party, in a manner that rises to the level of alleged or willful
      negligence, fraud, or bad faith with respect to any of the terms and
      conditions of this Agreement.

	 	 	 
	E. 	
      In addition to the Termination Events specified in
      Article 2(D), PRe may also terminate this Agreement at any time, by giving
      advance written notice to MSRE, in the event that MSRE ceases to
      underwrite the Business Covered and/or adjust claims as regards the
      Original Policy risks pursuant to this Agreement that results in
      significant loss or exposure to PRe.

	 	 	 
	F. 	
      The termination of this Agreement pursuant to a
      Termination Event or in accordance with a Termination, as specified in
      Article 2E above, may only be effected on a run-off, commutation, or, as
      specified in Article 2D above, loss portfolio transfer basis, as agreed to
      in writing by the Parties.

	 	 	 
	G. 	
      For purposes of this Article, the term “run-off” means
      that PRe will continue to be liable for losses occurring or claims made on
      or after the effective date of Termination in respect of risks attaching
      prior to the effective date of Termination.

	 	 	 
	H. 	
      No Termination will permit PRe to avoid, reduce, or
      eliminate exposures set forth under the Original Policies already
      underwritten by MSRE and assumed, in part, by PRe.



 3 






	I. 	
      Collateral pledged by PRe cannot be reduced as a result
      of a Termination unless agreed to in writing by the Parties.

	 	 
	J. 	
      MSRE’s authority to quote or cede new contracts of
      Business Covered to PRe will cease as of the date that MSRE receives
      written notice from PRe of PRe’s intent to terminate this Agreement on the
      basis of a Termination Event under Article 2(D) or Article 2(E). However,
      PRe is obligated to accept its proportionate share of any business ceded
      to PRe from the acceptance of binding quotations issued by MSRE prior to
      MSRE’s receipt of any such notice of PRE’s intention to terminate this
      Agreement.



ARTICLE 3 - COVER 

	A. 	
      MSRE will cede and PRe will accept by way of reinsurance
      under this Agreement a proportionate share of MSRe's liability in each
      Original Policy as assumed by MSRE pursuant to the Cedent Reinsurance
      Agreements in accordance with Appendix A.

	 	 
	B. 	
      MSRE Assumptions, and PRe’s respective quota share
      portion thereof, are to be structured to be consistent with the terms of
      the Original Policies as regards to whether Losses are to be recognized on
      a “claims made basis” and/or on a “claims occurrence basis”.

	 	 
	C. 	
      MSRE’s retrocession to PRe of the Business Covered is
      subject to the same terms and conditions that, among other things, include
      the limits specified in each Original Policy and that, consequently, are
      included in any such retrocession to PRe. Unless required by law, in no
      event are the terms and contents of this Article to be construed in any
      way to provide coverage outside of the terms and conditions set forth in
      the Original Policies and/or in this Agreement.

	 	 
	D. 	
      PRe’s obligations under this Agreement are on a several
      basis and are, at all times, limited to the portion of the MSRE
      Assumptions that PRe has assumed pursuant to this Agreement. PRe has no
      liability arising out of the actions or inactions of MSRE’s other
      Retrocessionaires.



ARTICLE 4 - TERRITORY 

The territory covered by this Agreement will follow the
Original Policies. 

ARTICLE 5 - EXCLUSIONS 

This Agreement specifically excludes all business listed as
Exclusions under the Original Policies, unless otherwise defined in the Original
Policies or the Cedent Reinsurance Agreement. 

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ARTICLE 6 - DEFINITIONS 

Capitalized terms not defined elsewhere in this Agreement are
defined in Appendix B hereto and is an integral part of this Agreement. 

ARTICLE 7 - PREMIUM 

MSRE will remit to PRe a percentage of the Ceded Net Written
Premium equal to PRe’s participation percentage in each Original Policy, which
percentage will be determined in accordance with Appendix A. 

ARTICLE 8 – MSRE RETROCESSION COMMISSION AND UNDERWRITING
INCENTIVE 

	A. 	
      For the reinsurance business assumed by PRe from MSRE
      under the terms and conditions of this Agreement, PRe authorizes MSRE to
      deduct from the Ceded Net Written Premium a retrocession commission
      payable to MSRE of [***Confidential Treatment Requested***] of the Gross Written Premium for each Cedent Reinsurance Agreement written or renewed under this Agreement (the
      “MSRE Retrocession Commission”).

	 	 
	B. 	
      PRe will pay MSRE a performance incentive (the
      “Underwriting Performance Incentive”) when PRe’s underwriting results are
      less than [***Confidential Treatment Requested***] (the “Ultimate Combined
      Ratio Benchmark”). The Underwriting Performance Incentive will be
      [***Confidential Treatment Requested***] of Ultimate Combined Ratio
      Benchmark less MSRE Retrocession Commission less the Ultimate Combined
      Ratio. The Underwriting Performance Incentive is payable on the
      expiration, or commutation, of the related Original Policies underlying
      the MSRE Assumptions assumed pursuant to the Cedent Reinsurance
      Agreements.



ARTICLE 9 – ACCOUNTS, REPORTS, AND REMITTANCES


	A. 	
      For purposes of this Article, and this Article only, all
      references to MSRE are deemed to include “MSRE and/or its
  Agents.”

	 	 	 
	B. 	
      Within forty-five (45) days following the end of each
      month, as regards the Business Covered, MSRE will provide PRe with a
      written report that includes the following information, which report may
      include estimates where definitive information is not available, by line
      of business, for that preceding month:

	 	 	 
		(i) 	
      Ceded Net Written Premium;

	 	 	 
		(ii) 	
      Ceding Commissions;

	 	 	 
		(iii) 	
      paid Loss and Loss Adjusted
Expense;



 5 






	 	(iv) 	
      Profit Commissions;

	 	 	 
	 	(v) 	
      MSRE Retrocession Commissions;

	 	 	 
	 	(vi) 	
      reserves for outstanding loss;

	 	 	 
	 	(vii) 	
      reserves for outstanding Loss Adjusted Expense;

	 	 	 
	 	(viii) 	
      reserves for unearned premium; and

	 	 	 
	 	(ix) 	
      the balance of the subparagraph (i) less subparagraph
      (ii) less subparagraph (iii) less subparagraph (iv) less subparagraph (v)
      (the “Balance”).




	C. 	
      Within forty-five (45) days following the end of each
      month, each Party will remit to the other Party any Balance due. If the
      Balance is due to PRe, MSRE will remit that Balance within forty-five (45)
      days following the end of the month. If the Balance is due to MSRE, PRe
      will remit that Balance as soon as reasonably practicable after receiving
      and accepting the monthly report from MSRE, but not to exceed thirty (30)
      days following PRe's receipt of the monthly report from MSRE.

	 	 
	D. 	
      In addition to the reports referred to in Article 9(B),
      MSRE and/or the Agents of MSRE and its affiliates will provide PRe with
      the reports identified in Schedule II of the Master Services
    Agreement.

	 	 
	E. 	
      Quarterly and annually, MSRE will provide PRe with any
      other information that PRe may reasonably require for the completion of
      PRe’s financial statements and regulatory requirements, which data may be
      reasonably available to MSRE.



ARTICLE 10 – LOSS SETTLEMENTS 

	A. 	
      MSRE will advise PRe within seven (7) business days of
      all Losses that MSRE becomes aware of and may result in a Loss settlement
      and any subsequent developments with respect thereto under this Agreement
      that may materially and/or adversely affect the capital position of PRe.
      Such Loss reporting to PRe will include, but is not limited to, (i)
      incurred Losses of ten per cent (10%) or more of PRe’s capital position
      and (ii) any claims that may involve loss in excess of original policy
      limits (“XOPL”) and extra contractual obligations (“ECO”) settlements. Any
      inadvertent omission or oversight in providing such advice to PRe is in no
      way to affect the liability of PRe; however, when discovered, MSRE will
      notify PRe within three (3) business days of any such omission or
      oversight.

	 	 
	B. 	
      MSRE will have the right to settle all Loss-related
      claims under the Original Policies. However, when so requested by PRe,
      MSRE will afford PRe, at PRe’s own expense, to associate (although not
      control) with MSRE in the defense of any lawsuit or other
  litigation proceeding that involves the Business Covered by this
      Agreement, and MSRE and PRe will cooperate in every respect in any such
  defense.



 6 






	C. 	
      All valid Loss settlements payable to the Cedents and any
      related valid ALAE and ULAE payments made by MSRE, including any Ex-Gratia
      Settlements, are to be unconditionally binding on PRe solely in proportion
      to PRe’s quota share portion of the subject Original Policy, provided that
      such Loss settlements payable to the Cedents and ALAE and ULAE payments,
      are either made (i) within the terms and conditions of this Agreement, or
      (ii) in addition to coverage required by the terms and conditions of the
      Original Policy and this Agreement (the “Ex-Gratia Settlement”) solely for
      the purpose of reducing future liability in an amount greater than the
      Ex-Gratia Settlement.

	 	 
	D. 	
      PRe agrees to pay or allow, as the case may be, its share
      of each such settlement to be made in accordance with this Agreement
      within five (5) Business Days of receipt of proof of payment of any such
      settlement from MSRE. In connection with PRe’s obligations in respect of
      such payments, MSRE may request, and PRe agrees, to grant signing
      authority to MSRE to fulfill PRe’s obligations under this Agreement,
      should MSRE determine that such authority was necessary.

	 	 
	E. 	
      MSRE will deposit all salvage and subrogation recoveries,
      net of recovery cost, into the Premium Monies Account and credit PRe with
      PRe's proportionate retroceded share of those recoveries on all Business
      Covered Losses, ALAE, and ULAE. MSRE agrees to enforce MSRE’s and PRe’s
      salvage and subrogation rights and to pursue all claims that have the
      potential for any recoveries in excess of recovery costs related to those
      rights as regards the Business Covered.

	 	 
	F. 	
      At all times, MSRE will avoid circumstances and/or
      actions that could lead to XOPL or ECO claims. However, if an XOPL claim
      payment is imposed on MSRE by an arbitrator, regulator, or court of
      competent jurisdiction, then, consistent with this Article, PRe will pay
      its proportionate share of any such excess. PRe may subsequently pursue
      recovery from MSRE for any XOPL payment in the event that any such Loss
      has been incurred because of failure by MSRE, by reason of alleged or
      willful negligence, fraud, or bad faith, in (i) rejecting an offer of
      settlement within the Original Policy limit or, (ii) in the preparation of
      the defense or in the trial of any action against an Insured, or (iii) in
      the preparation or prosecution of an appeal consequent to any such
      action.

	 	 
	G. 	
      The date on which any ECO is incurred will be deemed, in
      all circumstances, to be the date or dates of the original accident,
      casualty, disaster, or Loss Occurrence.

	 	 
	H. 	
      In the event that the Parties cannot agree on fault or
      payments as regards to any XOPL or ECO situation, any such matter will be
      resolved by Arbitration as set forth in this
Agreement.



ARTICLE 11 – PROFIT COMMISSION SETTLEMENTS 

 7 





Certain of the MSRE Assumptions may include a provision for a
“Cedent Profit Commission” to the Cedent based on a specified calculation
related to actual experience for the subject Original Policies. 

ARTICLE 12 - OFFSET 

The Parties may offset any balance or amount due from one Party
to the other under this Agreement, provided that this right to offset is limited
to only balances that arise from obligations provided for under the Original
Policies, the Cedent Reinsurance Agreements, or this Agreement, and may not be
construed as allowing any such offset against any balance or balances
attributable to any other agreement, transaction, or unrelated business
activity. In the event of insolvency of either the Party, any offset will only
be permitted in accordance with Bermuda Laws. 

ARTICLE 13 – NET RETAINED LIABILITY 

	A. 	
      All of the liabilities pursuant to the MSRE Assumptions
      will be fully-funded by the Retrocessionaire(s) and MSRE will not retain
      any liability to the Cedents with respect to the MSRE
  Assumptions.

	 	 
	B. 	
      The amount of PRe's liability hereunder in respect of any
      loss or losses will not be increased by reason of the inability of MSRE to
      collect from any other Retrocessionaire(s), whether specific or general,
      and/or any amounts that may have become due from such Retrocessionaire(s),
      whether such inability arises from the insolvency of such other
      Retrocessionaire(s) or from some other
circumstance.



ARTICLE 14 – COLLATERAL 

	A. 	
      PRe’s obligations under this Agreement are to be fully
      funded by having PRe place sufficient assets in a Custody Account
      (“Custody Account”) at CitiBank, or such other institution or with a
      trustee (the “Custodian”) as is otherwise agreed to by the Parties, which
      Custody Account will be funded at all times as is necessary to ensure that
      the obligations of PRe under this Agreement remain fully
      collateralized.

	 	 
	B. 	
      The Custody Account will be held by the Custodian for the
      sole benefit of PRe and will be used to collateralize Letters of Credit
      (“LOCs”) and/or set up a trust or trusts (the “Trust Arrangements”)
      required to secure PRe’s obligations pursuant to the Original Policy on
      the Business Covered under this Agreement. MSRE is expressly authorized to
      direct that the LOCs or the Trust Arrangements secured by the funds in the
      Custody Account be used to write the Business Covered in accordance with
      the terms set out in this Agreement.

	 	 
	C. 	
      Notwithstanding any other provision of this Agreement,
      MSRE and PRe agree that any funding provided by PRe pursuant to the
      provisions of this Agreement may be drawn on at any time and that any such funding will be available to be
utilized, by operation of law, by MSRE or any MSRE successor, including without
limitation, any liquidator, rehabilitator, receiver, or conservator to: 



 8 






	 	(i) 	
      reimburse MSRE for PRe’s Loss obligations under the terms
      and provisions of this Agreement and the Original Policies that are due
      and have not been otherwise paid by PRe;

	 	 	 
	 	(ii) 	
      make refunds of any sums that are in excess of the actual
      amount required to pay the PRe’s Loss obligations under the terms of this
      Agreement; and

	 	 	 
	 	(iii) 	
      pay PRe’s share of any other amounts that are due under
      this Agreement.




	D. 	
      If the amount so drawn down by MSRE is in excess of the
      actual amount required to satisfy the requirements of Paragraph A of this
      Article, then MSRE will immediately return to the Custody Account the
      excess amount so drawn. All of the foregoing provisions of this Article
      will be applied without diminution because of insolvency on the part of
      MSRE or PRe.

	 	 
	E. 	
      The issuing bank(s) of the LOCs or the trustee in the
      Trust Arrangements will have no responsibility whatsoever in connection
      with the propriety of withdrawals made by MSRE or the disposition of funds
      withdrawn, except to ensure that any and all withdrawals are made only on
      the order of properly authorized representatives of MSRE.

	 	 
	F. 	
      PRe will be responsible for all costs, disbursements, and
      expenses that are directly associated with the LOCs, the Trust
      Arrangements, and the Custody Account.



Upon termination of this Agreement, the amounts in the Custody
Account will be adjusted quarterly for the business written under the terms of
this Agreement until all of the liabilities of PRe are extinguished, at which
point any remaining amounts in the Custody Account will be returned to PRe and
the LOCs and/or the Trust Arrangements will be cancelled. 

ARTICLE 15 – FOLLOW THE SETTLEMENTS 

PRe’s liability will attach simultaneously with that of MSRE
and is subject in all respects to the same risks, terms, conditions,
interpretations, Cedent Profit Commission arrangements, waivers, modifications,
alterations, and cancellation provisions included in the Original Policies and
the Cedent Reinsurance Agreements. Accordingly, in every case to which this
Agreement applies and in the MSRE Assumption specified herein, the intent of
this Agreement is that PRe’s obligations will follow the underwriting
fortunes and settlements of MSRE as related to MSRE’s participation in the
Original Policies pursuant to the Cedent Reinsurance Agreements.

ARTICLE 16 - ACCESS TO RECORDS 

 9 






	A. 	
      Subject to any restrictions in the Original Policies or
      the Cedent Reinsurance Agreements, PRe or its duly authorized
      representatives will, after giving five (5) working days’ prior notice,
      have the right to visit the offices of MSRE in Bermuda during regular
      business hours to inspect, examine, audit, and verify any of the Original
      Policies, accounting or claim files (“Records”) that relate to PRe’s
      proportional share of the MSRE Assumptions, and all of the papers and
      documents in the possession of MSRE and all of MSRE’s affiliates, MSRE’s
      parent company(ies) and its (their) affiliates, and the Agents of those
      entities (e.g., any managing general agent, managing general underwriter,
      and/ or other third-party administrator) that relate, or refer, to the
      Business Covered.

	 	 
	B. 	
      Notwithstanding PRe’s rights as set forth in Article
      16(A), PRe is not to have any right of access to the Records of MSRE if
      PRe is not current in all undisputed payments due MSRE. As a condition
      precedent to access to the Records, PRe and its duly authorized
      representative will keep confidential all information and reports derived
      from the Records of MSRE to which it has received access and will not
      publish or communicate that information or report(s) to any other person
      or its own retrocessionaire without MSRE’s express prior written consent,
      except as set out in Article 16(D) or (i) when required by its own
      retrocessionaires, (ii) when PRe is subject to a lawful subpoena or other
      duly issued order of a court or other regulatory or governmental
      authority, after giving notice to MSRE and allowing MSRE to take
      appropriate protective measures, or (iii) when required by auditors, legal
      counsel, and/or arbitrators involved in any arbitration procedures under
      this Agreement.

	 	 
	C. 	
      MSRE reserves the right to withhold any documents from
      PRe (i) concerning trade secrets of MSRE, (ii) subject to the terms of a
      third-party non-disclosure agreement with MSRE requiring third-party
      consent to disclosure, (iii) subject to the work product privilege or
      attorney-client privilege related to a dispute between the Parties, or
      (iv) concerning individual private information that as a matter of law
      cannot be disclosed by MSRE (hereinafter referred to in this Agreement as
      “Privileged Documents”). MSRE will reasonably try to exempt PRe from any
      third-party non-disclosure agreement or obtain consent from the third
      party to disclose to PRe. If MSRE permits PRe access to any Privileged
      Documents referenced in (i) through (iv) of this Article 16(C), PRe agrees
      to sign the MSRE’s non-waiver agreement to preserve the confidential,
      proprietary, and/or privileged nature of such Privileged
  Documents.

	 	 
	D. 	
      Subject to legal, regulatory, and stock exchange
      requirements, including matters such as blackout and/or quiet periods,
      MSRE and PRe may refer to the existence of this Agreement and the nature
      of their business relationship, in print, electronic, or other form of
      media, publicity, letterheads, directories, marketing, advertising, and/or
      verbal communication with third parties (or permit another party to do so)
      without receiving written consent from the other Party. Both Parties will
      establish and maintain adequate records of any such activities as required
      by any and all applicable statutes and
regulations.



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	E. 	
      During the course of this Agreement, MSRE and PRe may
      execute confidentiality agreements, including non-disclosure agreements,
      with prospective and actual reinsurance cedents or other third parties. No
      authority or right is afforded by this Agreement to either Party to
      disclose any information related to or set forth in any such
      confidentiality agreements without the prior written consent of the other
      Party to this Agreement.

	 	 
	F. 	
      MSRE will provide PRe with a copy of all Non-Standard
      Documentation within ten (10) business days of the receipt of any such
      documentation by MSRE.



ARTICLE 17 - ARBITRATION 

	A. 	
      As a precedent to any right of action hereunder, if any
      dispute should arise between MSRE and PRe with respect to or touching upon
      this Agreement, including, but not limited to, its interpretation,
      formation, and validity, or to their respective rights with respect to any
      transaction that involves both of the Parties, whether any such dispute
      arises before or after the termination of this Agreement, any such dispute
      will be resolved through arbitration with a three-person arbitration
      panel, pursuant to the written request of either Party. Any such
      arbitration panel will be comprised of three (3) arbitrators, one (1) to
      be chosen by each Party, and the third by the Parties jointly. If either
      Party refuses to, or neglects to, appoint an arbitrator within thirty (30)
      days after the receipt of written notice from the requesting Party that
      the other Party do so, the requesting Party may appoint two (2)
      arbitrators, who may appoint a third arbitrator. If the Parties fail to
      agree in the selection of a third arbitrator within thirty (30) days of
      the appointment of the two (2) party-appointed arbitrators, then the third
      arbitrator will be appointed by the Appointments Committee of the
      Chartered Institute of Arbitrators (Bermuda Branch). If that body fails to
      appoint an arbitrator within twenty-one (21) days of such request to them,
      then the appointment will be by the Supreme Court of Bermuda. All
      arbitration panel members are to be active or retired experienced
      professional service providers or executives who have extensive insurance
      or reinsurance experience and who have no conflicts of interest with the
      subject arbitration proceeding.

	 	 
	B. 	
      The arbitrators will interpret this Agreement and make
      their decision, and allocate arbitration-related costs, after giving
      consideration to the custom and usage of the insurance and reinsurance
      business.

	 	 
	C. 	
      A single signed decision by at least two (2) arbitrators
      (in the event that any third arbitrator refuses to sign), when filed with
      the Parties hereto, will be final and binding on both Parties. Based on
      the final decision of those arbitrators, judgment may be entered in any
      court having jurisdiction. Any arbitration undertaken with respect to this
      Agreement is to take place in Bermuda, unless some other venue is mutually
      agreed to, in writing, by MSRE and PRe.

	 	 
	D. 	
      Unless the Parties otherwise agree, the arbitration will
      be governed by the laws of Bermuda and the Bermuda International Conciliation and
Arbitration Act 1993 (exclusive of the Conciliation part of such Act, including
the United Nations Commission on International Trade Law Model Law on
International Commercial Arbitration) and/or any statutory amendments or
reenactments thereof.



 11 





ARTICLE 18 - INSOLVENCY 

	A. 	
      This Article and the laws of Bermuda are to apply in the
      event of the insolvency of MSRE or PRe. In the event of any conflict
      between any provision of this Article and the laws of Bermuda, Bermuda
      laws are to prevail.

	 	 
	B. 	
      In the event of the insolvency of MSRE, the amounts due
      pursuant to this Agreement (or for the portion of any risk or obligation
      assumed by PRe, if required by applicable law) will be payable directly to
      MSRE, or to its liquidator, receiver, trustee, or statutory successor,
      either (i) on the basis of the liability of PRe to MSRE, or (ii) on the
      basis of claims that have been filed and allowed in any liquidation and/or
      receivership proceeding, whichever may be required by applicable law,
      without diminution because of the insolvency of MSRE or because the
      liquidator, receiver, trustee, or statutory successor of MSRE has failed
      to pay all or a portion of any claim that is attributable to PRe under the
      terms of this Agreement. However, it is agreed to by the Parties that MSRE
      will continue to give written notice to PRe of the pendency of any such
      claim against MSRE that is related to the Business Covered. Any such
      written notice that would involve a possible liability on the part of PRe
      will be provided to PRe within thirty (30) days after any such claim is
      filed in a receivership or liquidation proceeding. During the pendency of
      any such claim, PRe may (i) investigate any such claim, (ii) interpose in
      the proceeding where such claim will be adjudicated, and (iii) participate
      in, or direct, any defense or defenses that PRe may deem to be available
      to PRe, to MSRE, or to MSRE’s liquidator, receiver, or statutory
      successor, in each case subject to any necessary approval of the court of
      competent jurisdiction and/or an appropriate regulatory authority. Any
      expense incurred by PRe in any such endeavor will be chargeable, subject
      to the approval of the court of competent jurisdiction and/or an
      appropriate regulatory authority, against MSRE as part of the expense of
      liquidation or conservation to the extent of the pro rata share of the
      benefit that may be attributable to MSRE solely as a result of the
      investigation and/or defense undertaken by PRe.

	 	 
	C. 	
      Subject to Article 18(B), in the event that two (2) or
      more of the Retrocessionaires are involved in the same type of
      insolvency-related claim, and a majority in interest elect to interpose a
      defense to any such claim, that related expense will be apportioned among
      those Retrocessionaires in proportion to the collective liability exposure
      of those Retrocessionaires.

	 	 
	D. 	
      As to every retrocession ceded or renewed under this
      Agreement, the amounts payable for the subject retrocession are to be
      payable as set forth in this Article by PRe to MSRE or to the liquidator,
      receiver, trustee, or statutory successor, except where PRe, with the
      consent of the Original Insured(s), has assumed such Original Policy
      obligations of MSRE as direct obligations of PRe to the payees under such
      Original Policies and in substitution for the obligations of MSRE to such payees. Then, and in that event
only, MSRE, with the prior approval of such regulatory authority as may be
applicable, is entirely released from its obligations and rights to any and all
premiums, ceding commissions, and fees, and PRe will receive any and all
premiums, ceding commissions, and fees and pay any valid Loss due directly to
the payees pursuant to the Original Policy. 



 12 





ARTICLE 19 – GOVERNING LAW 

This Agreement, including all matters relating to formation,
validity, and performance thereof, will be governed by and interpreted in
accordance with the laws of Bermuda. 

ARTICLE 20 – CURRENCY 

Wherever the word “dollar” and/or the “$” symbol appear in this
Agreement or any Appendix hereto, they are to mean United States Dollars, unless
agreed to in writing by the Parties, provided that any non-US dollar denominated
MSRE Assumptions under this Agreement will follow the denomination of the
currency used in any such applicable MSRE Assumptions. 

ARTICLE 21 – TAXES 

	A. 	
      Each Party will be responsible to pay its own
    taxes.

	 	 
	B. 	
      If PRe is or becomes subject to premium tax, excise tax,
      or to any other insurance-related tax (hereinafter referred to as the
      “Tax”), in the United States, Canada, or elsewhere, PRe agrees to allow,
      for the purpose of having MSRE pay the Tax, MSRE to deduct from the
      subject premium collected the applicable percentage of the premium
      payable, or such other related calculated amount, pursuant to such Tax, to
      the extent that such premium is subject to the Tax to be paid.

	 	 
	C. 	
      In the event that PRe returns any premium to MSRE, PRe
      will deduct from the amount of the return premium the same Tax percentage
      as was allowed when the premium was received, and MSRE and/or its Agent
      will take all necessary actions to recover the Tax from the U.S.
      Government or other applicable jurisdictional tax body.

	 	 
	D. 	
      MSRE and PRe will notify the other Party within seven (7)
      business days of any tax inspection or audit related to the Business
      Covered and/or this Agreement, and the results of any such tax inspection
      or audit.



 13 





ARTICLE 22 – INDEMNIFICATION AND ERRORS AND
OMISSIONS 

	A. 	
      PRe is reinsuring, to the amount herein provided, and
      severally and not jointly with any other reinsurers of the Original
      Policy, the obligations of MSRE under the Original Policies pursuant to
      the Cedent Reinsurance Agreements. MSRE will
determine:




	 	(i) 	
      what constitutes a claim or Loss covered under any
      Original Policy assumed by MSRE;

	 	 	 
	 	(ii) 	
      MSRE's liability thereunder; and

	 	 	 
	 	(iii) 	
      the amount or amounts that are proper for MSRE to pay
      thereunder.




	B. 	
      PRe will be bound by MSRE’s determination as to the
      obligation(s) and liability(ies) of MSRE under any Original
    Policies.

	 	 
	C. 	
      Any inadvertent error, omission, or delay of a clerical
      nature will not be held to relieve either Party from any liability that
      would attach to it hereunder if such error, omission, or delay had not
      been made, provided such error, omission, or delay is rectified
      immediately or as soon as possible upon discovery.



ARTICLE 23 – REPRESENTATIONS, WARRANTIES, AND
COVENANTS 

	A. 	
      Each Party hereby represents and warrants that:

	 	 	 
		(i) 	
      It is duly organized, validly existing, and in good
      standing under the laws of the jurisdiction of its incorporation or
      organization, and has full power and authority to execute and deliver this
      Agreement and to perform its obligations hereunder.

	 	 	 
		(ii) 	
      This Agreement (a) has been duly approved by all
      necessary actions, including any necessary shareholder or membership
      approval, (b) has been executed by its duly authorized officers, and (c)
      constitutes a valid and binding agreement enforceable in accordance with
      its terms.

	 	 	 
		(iii) 	
      The execution, delivery, and performance of this
      Agreement (a) have been authorized by all necessary corporate actions by
      the Parties, and (b) does not violate, conflict with, or cause a default
      under (i) its articles of incorporation, articles of organization,
      bye-laws, management agreement, or other organizational document, as
      applicable, or (ii) any applicable law or regulation, court order, or
      administrative ruling or decree to which it is a party or to which any of
      its property is subject, or to any agreement, contract, indenture, or
      other binding arrangement to which it is a party or to which any of its
      property is subject.

	 	 	 
		(iv) 	
      There is no requirement to make any filing with, or give
      any notice to, any governmental entity or body, or obtain any order, permit,
approval, waiver, license, or similar authorization, in connection with the
completion of the transactions contemplated by this Agreement. 



 14 






	B. 	
      Each Party covenants to do such things and to execute
      such further documents and assurances as may be deemed necessary or
      advisable from time to time to carry out the terms and conditions of this
      Agreement in accordance with their true intent.

	 	 
	C. 	
      Each of the representations and warranties made by either
      Party in this Agreement will survive the Termination of this Agreement.
      All covenants and agreements made by either Party in this Agreement will
      survive until performed or the obligation to so perform has
  expired.



ARTICLE 24 – AMENDMENTS 

	A. 	
      It is hereby understood and agreed that any amendments
      and/or alterations to this Agreement that are mutually agreed on by
      addendum will be automatically binding on the Parties and will be
      considered to form an integral part of this Agreement.

	 	 
	B. 	
      All amendments, extensions, cancellations, and/or
      replacements to the Original Policies are to be made strictly in
      accordance with the requirements imposed by the “MSRE Underwriting
      Guidelines” as attached as Appendix 2 to the Master Services Agreement,
      and in compliance with all applicable statutes and
  regulations.



ARTICLE 25 – THIRD-PARTY RIGHTS 

This Agreement is solely between MSRE and PRe, and in no
instance is any insured, claimant, or other third party to have any rights under
this Agreement. 

ARTICLE 26 – NOTICES 

All notices, directions, requests, demands, acknowledgments,
and other communications required or permitted to be given or made under the
terms hereof will be in writing and will be deemed to have been duly given or
made when transmitted by certified or registered mail, nationally or
internationally recognized express delivery service, personal delivery,
electronic mail, or facsimile (with the exception of notices of termination,
first class mail is also acceptable), when addressed as follows: 

 15 






	 	If to MSRE: 	If to PRe: 
	 	  	  
	 	Multi-Strat Re Ltd. 	Resource Re Ltd. 
	 	Attn: Robert Forness 	c/o Cedar Management Limited 
	 	19 Queen Street 	Attn: Tom McMahon 
	 	Hamilton, HM 11, Bermuda 	Continental Building 
	 	Email: bob@multistrat.bm 	25 Church Street 
	 	  	P.O. Box HM 824 
	 	  	Hamilton HMCX, Bermuda 
	 	  	Email: tmcmahon@cedar.bm 


A Party may change the address and/or addressee to which
notices and other communications, hereunder, are to be sent to the other Party
by giving the other Party written notice thereof in accordance with this
Article. 

ARTICLE 27 – ASSIGNMENT 

Neither Party may assign this Agreement or any of its
obligations hereunder, without the prior written consent of the other Party;
provided, however, that this Agreement will inure to the benefit of and bind
those who, by operation of law, become successors to the Parties, including,
without limitation, any liquidator, rehabilitator, receiver, conservator, or any
successor merged, amalgamated, or consolidated entity. 

ARTICLE 28 – COUNTERPARTS 

	A. 	
      The use of any of the following will constitute a valid
      execution of this Agreement or any amendments thereto:

	 	 	 
		(i) 	
      paper documents with an original ink signature;

	 	 	 
		(ii) 	
      facsimile or electronic copies of paper documents showing
      an original ink signature; and

	 	 	 
		(iii) 	
      electronic records with an electronic signature made via
      an electronic agent.

	 	 	 
	B. 	
      This Agreement may be executed in one or more
      counterparts, each of which will be deemed an original, but all of which
      together are to constitute one and the same
instrument.



ARTICLE 29 – NO PARTNERSHIP 

Nothing provided herein is intended to create a joint venture,
partnership, tenancy-in-common, or joint tenancy relationship between or among
any of the Parties. 

 16 





ARTICLE 30 - WAIVER 

A waiver by either Party of any breach or default by the other
Party will not constitute a continuing waiver or a waiver by such Party of any
subsequent act in breach or of default hereunder. 

ARTICLE 31 - HEADINGS 

The headings used in this Agreement are for reference purposes
only and are not deemed to be a part of this Agreement. 

ARTICLE 32 - ENFORCEABILITY 

If any provision of this Agreement is deemed to be illegal or
unenforceable by the laws, regulations, or public policy of any jurisdiction,
then such provision will be considered void in such jurisdiction, but that
illegal or unenforceable provision will not affect the validity or
enforceability of any other provision of this Agreement or the enforceability of
any provision in any other jurisdiction. 

ARTICLE 33 - ENTIRE AGREEMENT 

This Agreement and the Appendixes hereto and the Master
Services Agreement, constitute the entire agreement between the Parties with
respect to the transactions contemplated in this Agreement and supersede all
prior agreements, understandings, negotiations, and discussions, whether oral or
written, of the Parties with respect to such transactions. There are no
representations, warranties, covenants, conditions, or guarantees, expressed or
implied, between the Parties in connection with the subject matter of this
Agreement, except as specifically set forth in this Agreement and the Master
Services Agreement. The Parties have not relied, and are not relying, on any
other information, discussion, or understanding in entering into and completing
the transactions contemplated by this Agreement.

[SIGNATURES ON THE NEXT PAGE] 

 17 





IN WITNESS WHEREOF, each of the Parties has caused this
Agreement to be executed in duplicate by its duly authorized representatives in
Hamilton, Bermuda on the date below. 

	By: Multi-Strat Re Ltd. 	 	By: Resource Re Ltd. 
	  	 	  
	  	 	  
	“/s/ Robert J.
      Forness” 	 	“/s/
      Thomas McMahon” 
	Signature 	 	Signature 
	  	 	  
	Robert J. Forness 	 	Thomas McMahon 
	Printed Name 	 	Printed Name 
	  	 	  
	CEO 	 	Director 
	Title 	 	Title 
	  	 	  
	August 8, 2014 	 	August
      11, 2014 
	Date 	 	Date 


 18 





APPENDIX A 

PARTICIPATING RETROCESSIONAIRES –
PARTICIPATION SCHEDULE

[***Confidential Treatment Requested (three pages redacted)***]

 

 

A - 1 





APPENDIX B 

DEFINITIONS 


	“Acquisition Costs” 	
      [***Confidential Treatment Requested***]

	“Agent” 	
      Includes any and all parties that provide services to,
      and/or act on behalf of, MSRE or PRe, as applicable, with respect to the
      administration, underwriting and claims administration, marketing, and
      sales related to MSRE’s or PRe’s operations, including, but not limited
      to, brokers, accounting/audit firms, legal firms, corporate secretary
      firms, administration firms, third-party claims administrators, managing
      general agents, managing general underwriters, subcontractors, etc.
  

	“ALAE” 	
      Allocated loss adjustment expense includes the (i)
      expenses of litigation, if any, (ii) subrogation expenses, (iii) legal
      expenses, (iv) costs incurred in connection with coverage and validity
      questions, and legal actions related thereto, that are allocable only to a
      specific claim or action on the Business Covered, (v) any related
      interest, including, but not limited to, prejudgment interest where such
      interest is part of the judgment or post judgment interest, and (vi) all
      other MSRE Loss-related expenses that pertain to a specific action on the
      Business Covered, but excludes (a) all of the salaries or expenses of
      MSRE’s directors, officers, employees, and/or Agents that are not directly
      related to the loss adjustment process as regards a specific claim or
      action with respect to the Business Covered, and (b) any overhead amounts
      (such as rent, postage, lighting, cleaning, heating, etc.). The resulting
      ALAE amounts are to be reduced by the related salvage, subrogation, and
      other expense recoveries. 

	“Brokerage Commissions” 	
      All amounts incurred and contractually related to the
      services provided by brokers, consultant underwriters, Agents, or other
      intermediaries for insurance or reinsurance placement and other related
      services. 

	“Business Covered” 	
      See Article 1. 




B - 1 







	“ceded” 	
      The transfer of an insurance policy risk from a
      reinsurance/insurance company to a reinsurance company. The company
      transferring the risk is referred to as the “cedent” or the “reinsured.”
      The company accepting the transferred risk is referred to as the “assuming
      company”, “reinsurer”, or “retrocessionaire.” 

	“Ceded Gross Written Premium” 	
      The gross premium ceded pursuant to the Original Policies
      to MSRE attributable to the Business Covered plus any applicable
      reinstatement or premium adjustments prior to any deductions. 

	“Ceded Net Written Premium” 	
      The Ceded Gross Written Premium reduced by any applicable
      Acquisition Costs incurred by MSRE and any related cancellations and
      premiums returned to MSRE during a specified time period.


	“Ceded Net Written Premium Collected” 	
      The amount of the Ceded Net Written Premium received by
      MSRE during a specified time period. 

	“ Cedent Profit Commission” 	
      The profit sharing arrangements calculated in accordance
      with the terms of the applicable Cedent Reinsurance Agreement. 

	“Cedent Reinsurance Agreement” 	
      See Recital C. 

	“Cedents” 	
      The parties that cede the risks that comprise the MSRE
      Assumptions pursuant to the Original Policies to MSRE pursuant to the
      Cedent Reinsurance Agreements. 

	“Ceding Commissions” 	
      Any amounts paid to the Cedents by MSRE to cover the
      Cedent’s acquisition costs and overhead expenses, taxes, licenses, and
      fees, including, when applicable, a fee representing a share of expected
      profits. Ceding Commissions are often expressed as a percentage of the
      gross reinsurance premium. 




B - 2 

Master Services Agreement (Redacted) 






	“claims made basis” 	
      The method for determining whether coverage is or is not
      available for a specific claim under an Original Policy or a reinsurance
      agreement. Claim coverage under a claims made basis Original Policy
      provides that the insurance/reinsurance company is responsible for the
      payment of the claim during the period that the Original Policy is in
      effect, up to the limits of the Original Policy coverage, for the claims
      presented regardless of when the event occurred that caused the claim to
      be submitted by the Insured. The basis for paying claims generally is
      stated in the Original Policy. 

	“claims occurrence basis” 	
      The method for determining whether coverage is or is not
      available for a specific claim under an Original Policy or a reinsurance
      agreement. Claim coverage under a claims occurrence basis Original Policy
      provides that, if a claim occurs during the period when the Original
      Policy is in force, the insurance/reinsurance company is responsible for
      the payment of the claim that occurs, up to the limits of the Original
      Policy coverage, regardless of when the claim is submitted by the Insured.
      The basis for paying claims generally is stated in the Original Policy.
      

	“commutation” 	
      The complete discharge of all obligations for a specified
      book of insurance business for an insurance/reinsurance company that
      results from the cession of that insurance business to another
      insurance/reinsurance company. 

	“Extra Contractual Obligations” (“ECO”) 	
      Liabilities that are not covered under any other
      provision of the Agreement that arise from the handling of any claim on
      the Business Covered because of, but not limited to, (i) the failure by
      MSRE to settle the claim within the Original Policy limit or other
      Original Policy provision, (ii) the alleged or actual gross negligence,
      fraud, or bad faith in MSRE’s rejection of an offer of settlement, (iii)
      the alleged or actual negligent preparation of MSRE’s defense, or in any
      related trial, of any action against an Insured or reinsured, or (iv) the
      alleged or actual negligent preparation or prosecution of any MSRE appeal
      that is consequent in regards to any such action. 

	“Ex-Gratia Settlement” 	
      See Article 10(C). 

	“Insured” 	
      The person or entity that owns the Original Policy or on
      whose behalf the Original Policy was purchased.





B - 3 







	“Loss” or “Losses” or “Loss
      Occurrence” 	
      Each and every accident, disaster, casualty, happening,
      or series of accidents, disasters, casualties, or happenings that arise
      out of one event, regardless of the number of interests insured or the
      number or kinds of perils involved that pertain to the Business Covered.
      

	“Loss Fund” 	
      The amounts set aside by PRe, and held by MSRE in the
      Premium Monies Account as set out in the Master Services Agreement, for
      the payment of Losses and Loss-related expenses that are attributable to
      the Business Covered and that are expected to be paid, or settled, within
      the subsequent ninety (90) day period.

	 “Loss in Excess of 
      Original Policy Limits” or “XOPL” 	
      See Article 10(A). 

	 “loss portfolio transfer” or
      “LPT” 	
      A reinsurance transaction in which the loss obligations
      of an insurance/reinsurance company that have already been incurred and
      will ultimately be paid can be discharged by transferring, i.e., ceding,
      those obligations to another insurer/reinsurer.  

	 “Master Services
    Agreement”	
      The master services agreement between the Parties
      executed concurrently with this Agreement.  

	 “managing general agent” or
      “MGA” 	
      The person/entity that, in an agent capacity for an
      insurer or reinsurer, performs certain functions that generally are
      carried out within an insurance/reinsurance company by
      insurance/reinsurance company personnel. Such delegated functions could
      include, but are not limited to, underwriting insurance/reinsurance
      business, collecting premiums, and settling claims on behalf of the
      insurer or reinsurer. 

	 “managing general
      underwriter” (“MGU”) 	
      A person/entity that, in an agent capacity for an insurer
      or reinsurer, is given the authority to underwrite and accept
      insurance/reinsurance business on behalf of that insurer or
      reinsurer.  

	 “MSRE Assumptions”	
      See Recitals, paragraph (A). 

	 MSRE Retrocession Commission
    	
      See Article 8(A).  




B - 4 







	“Non-Standard Documentation” 	
      Any notice, correspondence, or other documentation that
      is provided to, or received by, MSRE, its affiliates, and/or its Agents
      that, in MSRE’s experience, (i) is outside the normal course of business,
      (ii) is a request for information that MSRE is not normally required to
      provide to the relevant requesting person or entity, or (iii) could, in
      MSRE’s business judgment, negatively affect, in a material amount or
      manner, the Agreement, the Business Covered, or MSRE’s or PRe’s respective
      interests related thereto. 

	“Original Insured” 	
      The holder or successor in interest of the Original
      Policy. 

	“Original Policy” or “Original Policies” 	
      The entire written insurance agreement, including
      coverage forms and endorsements, or a binding quotation issued, renewed,
      extended, or accepted provisionally by a Cedent or an agent of a Cedent,
      that is subsequently assumed, in whole or in part, by MSRE, all or a
      portion of which is then retroceded to PRe pursuant to the Agreement.
    

	“policy limits” 	
      The amount of the coverage provided under the Original
      Policy. 

	PRE Assets Account 	
      The separately managed account to which the premiums,
      salvage, subrogations, deposits, and other MSRE assumed
      reinsurance-related assets are deposited, based on PRe’s participation
      capacity in relation to the total MSRE Assumptions. 

	“PRe’s Total Capacity” 	
      The maximum amount of the MSRE Assumptions that PRe has
      the collateral to assume from MSRE, as updated from time to time and as
      calculated separately for each Agreement Year and/or for each calendar
      month within an Agreement Year. 

	“Premium Monies Account” 	
      The commingled account held in MSRE’s name for the
      benefit of the Retrocessionaires, including PRe, that includes Ceded Net
      Written Premium Collected for all Business Covered, plus interest earned
      on the Premium Monies Account and salvage and subrogation net recoveries,
      which amount, net of (i) Loss Fund holdbacks, (ii) Loss and Loss-related
      payments, and (iii) Profit Commission payments, is to be transferred to
      the account of PRe in proportion to PRe’s participation in the MSRE
      Assumptions for the Business Covered. 

	“retrocession” 	
      A transaction in which a reinsurer transfers all or a
      portion of the risks that it has reinsured to another reinsurer.
  




B - 5 







	“Retrocessionaire” or “Retrocessionaires” 	
      Retrocessionaires, other than PRe, that also reinsure or
      assume a portion of the business included in the MSRE Assumptions.
  

	“return premium” 	
      The premium, or a portion thereof, that is returned to
      the policyholder or cedent by an insurance/reinsurance company for some
      specific reason, e.g., the policy is cancelled, the policy benefits are
      reduced, or the policy premium is reduced. 

	
    [***Confidential Treatment Requested***]
	
      [***Confidential Treatment Requested***]
	“salvage” 	
      Any recoveries from Insureds, third parties, and/or
      cedents that are obtained or that are recoverable by MSRE pursuant to the
      rights granted to the insurer/reinsurer to the Insured’s property that is
      damaged, abandoned, or lost as a result of an insured peril and for which
      the insured or cedent has been compensated pursuant to the benefit
      provisions of the Original Policy. 

	“subrogation” 	
      Any recoveries from an Insured, third-party, or cedent
      that are obtained or that are recoverable by MSRE with respect to Losses,
      or a portion thereof, that were paid by MSRE, i.e., subrogation means the
      reimbursement obtained or recovery made by MSRE, less the actual cost,
      excluding salaries of any director, officer, employee, and/or agent of
      MSRE and any sums paid to attorneys as retainer, incurred in obtaining
      such reimbursement or making such recovery with respect to claims and
      settlements paid by MSRE that relate to the Business Covered. 

	“Tax” 	
      The premium tax, excise tax, or any other tax that may be
      imposed in the United States, and/or any other insurance-related tax that
      may be imposed by any other country or tax authority. 

	“Termination” and “Termination Event” 	
      See Article 2. 

	“ULAE” 	
      The unallocated loss adjustment expenses incurred by MSRE
      or its Agents in the investigation, adjustment, appraisal, or defense of
      all claims that pertain to the Business Covered, including declaratory
      judgment expenses, but excluding office expenses and the salaries of any
      director, officer, employee, and/or Agent of MSRE that are not directly
      related to the loss adjustment process as regards a specific claim or
      action with respect to the Business Covered.





B - 6 







	“Ultimate Combined Ratio” 	
      The sum of two ratios, the Ultimate Expense Ratio and the
      Ultimate Loss Ratio. 

	“Ultimate Expense Ratio” 	
      The ratio calculated by dividing all other expenses
      related to the MSRE Assumptions not included in the Ultimate Loss Ratio by
      total earned premiums related to the proportion of policies assumed by PRe
      under this Agreement. 

	“Ultimate Loss Ratio” 	
      The ratio calculated by dividing Ultimate Losses by the
      total earned premiums related to the proportion of policies assumed by PRe
      under this Agreement. 

	“Ultimate Losses” 	
      The amount paid for Losses, ALAE, and ULAE that are
      considered to be fully-developed on the proportion of policies assumed by
      PRe under this Agreement, less any salvage, subrogation, and other
      recoveries related thereto. 

	“Underwriting Performance Incentive” 	
      See Article 8(B). 




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