Exhibit 10.2  EXECUTION COPY   INDEMNITY REINSURANCE AGREEMENT   between   AMERICAN EXCHANGE LIFE INSURANCE COMPANY  (Ceding Company)   and   COMMONWEALTH ANNUITY AND LIFE INSURANCE COMPANY  (Reinsurer)  Effective as of April 1, 2009


TABLE OF CONTENTS PageARTICLE IDEFINITION OF
  TERMS
  1Section 1.1.
  Definitions
  1Section 1.2.
  Construction
  9Section 1.3.
  Headings
  9ARTICLE IIBASIS OF
  COINSURANCE
  9Section 2.1.
  Coinsurance
  9Section 2.2.
  Duration of Coinsurance;
  Recapture
  10Section 2.3.
  Parties to Coinsurance
  10ARTICLE IIICLOSING AND
  CONSIDERATION
  10Section 3.1.
  Settlement Amount
  10ARTICLE IVCOOPERATION BETWEEN THE
  CEDING COMPANY AND THE REINSURER FOLLOWING THE COINSURANCE EFFECTIVE DATE
  12Section 4.1.
  Ceding Company Service
  Period
  12Section 4.2.
  Premium Payments,
  Negotiation of Checks
  12Section 4.3.
  Reserves
  12Section 4.4.
  Reserve Credits
  12Section 4.5.
  Premium Taxes
  12Section 4.6.
  Payments Relating to
  Commissions
  13Section 4.7.
  Guaranty Fund Assessments
  13Section 4.8.
  Reports
  13Section 4.9.
  Monthly Settlement
  13Section 4.10.
  Audit
  14Section 4.11.
  Non-Guaranteed Elements
  14ARTICLE VUNDERTAKINGS OF CEDING
  COMPANY FOLLOWING THE COINSURANCE EFFECTIVE DATE
  15Section 5.1.
  Cooperation
  15ARTICLE VIINDEMNIFICATION
  15Section 6.1.
  Indemnification by the
  Ceding Company
  15Section 6.2.
  Indemnification by the
  Reinsurer
  16Section 6.3.
  Indemnification and
  Arbitration Procedures
  17Section 6.4.
  Cooperation
  17Section 6.5.
  Payment in Full for Losses
  17  i


ARTICLE VIIINSOLVENCY
  17Section 7.1.
  Payment of Benefits under
  an Insolvency
  17Section 7.2.
  Required Notice of and
  Defense against Claims
  18ARTICLE VIIIARBITRATION
  18Section 8.1.
  Agreement to Arbitrate
  18Section 8.2.
  Method
  18Section 8.3.
  Power of Arbitrators
  19Section 8.4.
  Arbitration Fees and
  Expenses; Decision
  19ARTICLE IXGENERAL
  PROVISIONS
  20Section 9.1.
  Notices
  20Section 9.2.
  Confidentiality
  20Section 9.3.
  Misunderstandings and
  Oversights
  20Section 9.4.
  Reinstatements
  20Section 9.5.
  Entire Agreement
  20Section 9.6.
  Waivers and Amendments
  20Section 9.7.
  No Third Party
  Beneficiaries
  20Section 9.8.
  Binding Effect; No Assignment
  21Section 9.9.
  Governing Law
  21Section 9.10.
  Counterparts
  21Section 9.11.
  Severability
  21Section 9.12.
  Exhibits and Schedules
  21Section 9.13.
  Election Statement
  21Section 9.14.
  Additional Tax Provisions
  22Section 9.15.
  Set Off
  22SCHEDULE 3.1
  SETTLEMENT AMOUNTSCHEDULE 4.6
  PAYMENTS RELATING TO
  COMMISSIONSSCHEDULE 4.9
  MONTHLY SETTLEMENT REPORTSEXHIBIT A
  POLICY FORMS AND PLAN
  CODES, SUM OF ALL RESERVE ITEMSEXHIBIT B
  STATUTORY RESERVES AND
  LIABILITIES BY POLICYEXHIBIT C
  TRANSFERRED ASSETS  ii


INDEMNITY REINSURANCE AGREEMENT  THIS INDEMNITY REINSURANCE AGREEMENT(the Agreement), effective as of April 1,
2009, is made and entered into by and between AMERICAN
EXCHANGE LIFE INSURANCE COMPANY, a Texas stock life and health
insurance company (the Ceding Company)
and COMMONWEALTH ANNUITY AND LIFE INSURANCE
COMPANY, a Massachusetts stock life insurance company (the Reinsurer).  WHEREAS,
the Ceding Company has issued or assumed certain life insurance and annuity
Policies, which are identified by policy form number and/or plan code on Exhibit Aattachedhereto; and  WHEREAS,
the Ceding Company, together with certain of its Affiliates named therein, and
the Reinsurer have entered into (i) that certain Master Agreement dated November 26,
2008, as amended by Amendment Number 1 to Master Agreement, dated April 24,
2009 (the Amendment),
with FAFLIC (collectively, the Master
Agreement) and (ii) that certain Joinder Agreement, dated January 9,
2009, with FAFLIC (the Joinder Agreement),
pursuant to which, among other things, the Ceding Company and the Reinsurer
have mutually agreed to enter into this Agreement pursuant to which the Ceding
Company shall cede, and the Reinsurer shall indemnity reinsure, the Insurance
Liabilities on a one hundred percent (100%) coinsurance basis on the terms and
conditions stated herein.  NOW,
THEREFORE, in consideration of the mutual promises and covenants set forth
herein and in the Master Agreement and Joinder Agreement, and in reliance upon
the representations, warranties, conditions and covenants contained herein and
therein, and intending to be legally bound hereby, the Ceding Company and the
Reinsurer hereby agree as follows:  ARTICLE I  DEFINITION OF TERMS  Section 1.1.
Definitions.  Capitalized terms
used in this Agreement, but not otherwise defined in this Article I,
shall have the meaning given thereto in the Master Agreement. The following
capitalized words and terms shall have the following meanings when used in this
Agreement:  (a)Affiliate has the meaning ascribed
thereto in the Master Agreement.  (b)Agreement has the meaning set forth in
the Preamble.  (c)Amendment has the meaning set forth in
the second recital hereof.  (d)Applicable Law has the meaning
ascribed thereto in the Master Agreement.  (e)Approved Designee has the meaning
ascribed thereto in the Services Agreement.  1


(f)Books and Records has the meaning
ascribed thereto in the Master Agreement.  (g)Business Day has the meaning ascribed
thereto in the Master Agreement.  (h)Ceding Company has the meaning set
forth in the Preamble.  (i)Ceding Company Caused Extra Contractual Liabilities
means all Extra Contractual Liabilities that are not Reinsurer Caused Extra
Contractual Liabilities or Reinsurer Covered Extra Contractual Liabilities.  (j)Ceding Company Indemnified Parties has
the meaning set forth in Section 6.2.  (k)Ceding Company Service Period means the
period commencing on the Closing Date and ending on the Transition Date.  (l)Closing has the meaning ascribed
thereto in the Master Agreement.  (m)Closing Date has the meaning ascribed
thereto in the Master Agreement.  (n)Closing Date Ceding Commission means
the Closing Date Ceding Commission determined with respect to the Ceding
Company pursuant to the Master Agreement. The Closing Date Ceding Commission
shall be credited to the Ceding Company as a reduction in the Settlement Amount
that would otherwise be payable by the Ceding Company to the Reinsurer at
Closing under Section 2.2 of the Master Agreement and Section 3.1
of this Agreement.  (o)Closing Fee has the meaning ascribed
thereto in the Amendment.  (p)Code means the Internal Revenue Code
of 1986, as amended.  (q)Coinsurance Effective Datemeans 12:01 a.m. (New York time) on
the first calendar day of the calendar month in which the Closing occurs.  (r)Conversion Services has the meaning
ascribed thereto in the Services Agreement.  (s)Cost of Capital means the cost of a
capital decrease resulting from the establishment of an Interest Maintenance
Reserve liability calculated as follows:  The
product of (i) the average of the amounts of the Interest Maintenance
Reserve liability (a) as of the first day of each calendar year (except in
the case of the year in which the Coinsurance Effective Date occurs, which
shall be as of the last day of the calendar quarter preceding the Coinsurance
Effective Date) and (b) as of the last day of each calendar year,
multiplied by (ii) an annual, simple interest rate  2


equal
to 5% (pro-rated for the year in which the Coinsurance Effective Date occurs)
(in this manner, the Cost of Capital is amortized in accordance with the Ceding
Companys Interest Maintenance Reserve amortization schedule as reported in its
statutory annual financial statement dated as of and for the period ended December 31,
2008 over a period of ten (10) years).  (t)Dispute Notice has the meaning set
forth in Section 3.1(d).  (u)ECL Cap means an amount not to exceed
in the aggregate $10,000,000 in respect of Losses sustained or incurred by, or
asserted against, (x) the Ceding Company Indemnified Parties in respect of
Reinsurer Covered Extra Contractual Liabilities, (y) those other Ceding
Company Indemnified Parties in respect of Reinsurer Covered Extra Contractual
Liabilities under each of the other Coinsurance Agreements (as defined in
the Master Agreement), entered into by the Reinsurer or FAFLIC, as the case may
be, and Affiliates of the Ceding Company of even date herewith, and (z) the
Reinsurer or FAFLIC, as the case may be, in respect of Reinsurer Covered Extra
Contractual Liabilities hereunder and under such other Coinsurance Agreements
identified in clause (y), taken as a whole. 
For the avoidance of doubt, any payment made by either the Reinsurer or
FAFLIC, as the case may be, (i) in respect of Reinsurer Covered Extra
Contractual Liabilities under any other such Coinsurance Agreement shall be
applied against the ECL Cap under this Agreement as if such payment had been
made hereunder, and (ii) under clauses (x), (y) or (z) of this
definition shall be applied against the ECL Cap only one time and shall not be
counted as a payment made pursuant to more than one such clause.  (v)Excluded Liabilities means any claim,
obligation or liability arising under, in connection with, or with respect to,
the Policies:  (i)for Premium
Taxes, including any litigation or expenses concerning Premium Taxes, to the
extent arising with respect to premiums collected on the Policies attributable
to all periods before the Coinsurance Effective Date, and/or to the extent
based upon assessments relating to all periods prior to the Coinsurance
Effective Date;  (ii)(x) in
connection with participation by the Ceding Company, whether voluntary or
involuntary, in any guaranty fund or other residual market mechanism
established or governed by any state or jurisdiction to the extent arising with
respect to premiums attributable to all periods prior to the Coinsurance
Effective Date and/or (y) to the extent based upon regulatory fines or
assessments relating to events which initially occurred or commenced prior to
the Transition Date (provided, that such liability or other obligation
will not be an Excluded Liability if it arose out of any act or omission of the
Ceding Company or its Affiliate that occurred (or in the case of an omission,
failed to occur) on or after the ClosingDate
and was made at the written or express direction or request of the Reinsurer or
its designees);  (iii)for Ceding
Company Caused Extra Contractual Liabilities;  3


(iv)for escheat
liabilities arising in respect of all periods prior to the Coinsurance
Effective Date;  (v)for all
Producer Payments;  (vi)relating to
disputes, litigation, investigations by Governmental Authorities, arbitrations
or legal proceedings arising out of acts or omissions of the Ceding Company or
its Affiliates that occurred prior to the Closing Date in connection with the
Policies, solely to the extent such liabilities are not Extra Contractual
Liabilities;  (vii)for all
premiums, payments, fees or other consideration or amounts due at any time with
respect to Reinsurance Coverage;  (viii)or portions of
the Policies, in each case, to the extent reinsured or purported by the Ceding
Company to be reinsured under Reinsurance Coverage, whether or not such
coverage is collected or collectible;  (ix)for any payment
to the Internal Revenue Service or any other Person resulting from or
attributable to any act or omission of the Ceding Company (including errors of
product design, language, or administration, or inaccurate or incomplete data
maintained in Books and Records) resulting in non-compliance of any Policy with
the requirements of the Code to the extent such act or omission was not made at
the written or express direction or request of the Reinsurer or its designees;  (x)incurred by the
Ceding Company in connection with a breach, or other failure to perform, by the
Ceding Company of the terms of any acquisition agreement pursuant to which any
of the Policies were originally acquired by the Ceding Company, except as such
breach or failure to perform results from acts or omissions by the Ceding
Company made at the written or express direction or request of the Reinsurer or
its designees;  (xi)arising from
the remediation processes in the States of Wisconsin and New York,
respectively;  (xii)arising from
any errors or omissions made by the Ceding Company, its Affiliates or designees
in calculating, paying, documenting or administering any surrender charges on
annuity contracts included among the Policies, including those errors that
arose in respect of surrender charges in the State of Utah; and  (xiii)solely to the
extent arising from changes that are made by the Ceding Company to the
non-guaranteed elements under the Policies without the prior written consent of
the Reinsurer other than such changes that are required by Applicable Law.  4


Excluded Liabilities shall
not include any gross liabilities and obligations incurred by the Ceding
Company to the extent attributable to acts, errors or omissions of the
Reinsurer or its designees in connection with the Reinsurers or its designees
(x) exercise of contractual rights and privileges of the Ceding Company
under the Policies pursuant to the Transaction Agreements, including pursuant
to Sections 2.1(a) and 4.11 hereof or (y) performance
of Required Services after the Transition Date. In no event shall the term
designees as used in this paragraph or in Section 6.2(d)(i) include
the Ceding Company, its Affiliates or their designees.  (w)Extra Contractual Liabilities means
all liabilities, obligations and other losses (including lost profits) incurred
or arising at any time under or relating to any Policy that are not covered by,
or that are in excess of, the contractual benefits arising under the express
terms and conditions of such Policies, whether to Policyholders, Producers,
Governmental Authorities or any other Person, which liabilities and obligations
or losses shall include any liability for fines, penalties, forfeitures, excess
or penalty interest, punitive, exemplary, special or any other form of extra
contractual damages relating to the Policies, and attorneys fees and expenses
awarded, and which arise from any act, error or omission of a party or its
designees, whether or not intentional, negligent, in bad faith or otherwise,
including any act, error or omission of a party or its designees relating to (i) the
marketing, underwriting, production, issuance, cancellation or administration
of the Policies, (ii) the investigation, defense, trial, settlement or
handling of claims, benefits or payments arising out of or relating to the
Policies, or (iii) the failure to pay or the delay in payment, or errors
in calculating or administering the payment, of benefits, claims or any other
amounts due or alleged to be due under or in connection with the Policies.  (x)Final Settlement Amount has the
meaning set forth in Section 3.1(b).  (y)Final Settlement Date has the meaning
set forth in Section 3.1(e).  (z)Governmental Authority has the meaning
ascribed thereto in the Master Agreement.  (aa)Independent Accountant means Deloitte &
Touche LLP; provided, that if such accounting firm is either unable or
unwilling to accept such engagement, the Ceding Company and the Reinsurer shall
jointly request the American Arbitration Association to appoint, within ten (10) Business
Days from the date of such request, an internationally recognized firm of
public accountants independent of both the Ceding Company and the Reinsurer to
serve as Independent Accountant.  (bb)Insurance Liabilities means all
claims, obligations, indemnities, losses or liabilities (and no others) arising
under, in connection with, or with respect to, the Policies (other than, in all
cases, Excluded Liabilities):  (i)prior to or
after the Coinsurance Effective Date under the express terms of the Policies,
including (x) any right to purchase additional coverage and obligations
arising under legal or regulatory requirements, (y) any loss settlements
within Policy limits, and (z) all such liabilities relating to actions,
suits or claims instituted at or after the Coinsurance Effective Date by a
Person;  5


(ii)for Reinsurer
Caused Extra Contractual Liabilities and Reinsurer Covered Extra Contractual
Liabilities, subject to the limitations contained in Section 6.2;  (iii)for all Premium
Taxes, including any litigation expenses (but only if initiated by or at the
request of Reinsurer) concerning Premium Taxes, to the extent arising with
respect to premiums on the Policies attributable to periods on or after the
Coinsurance Effective Date, and/or to the extent based upon assessments
relating to all periods on or after the Coinsurance Effective Date;  (iv)(x) in
connection with participation by the Ceding Company, whether voluntary or
involuntary, in any guaranty fund or other residual market mechanism
established or governed by any state or jurisdiction to the extent arising with
respect to premiums on the Policies attributable to periods on or after the
Coinsurance Effective Date and/or (y) to the extent based upon regulatory
fines or assessments relating to periods on or after (A) the Closing Date,
but only to the extent such regulatory fines or assessments arose out of any
act or omission of the Ceding Company or its Affiliate that occurred (or in the
case of an omission, failed to occur) on or after the Closing Date and was made
at the written or express direction or request of the Reinsurer or its
designees, or (B) the Transition Date;  (v)for all
out-of-pocket loss adjustment expenses incurred from and after the Transition
Date by the Ceding Company with respect to the Policies (other than in
connection with the Ceding Companys participation in such expenses under the
Services Agreement);  (vi)for escheat
liabilities for checks issued by the Reinsurer on or after the Coinsurance
Effective Date; and  (vii)for amounts
payable on or after the Coinsurance Effective Date for returns or refunds of
premiums under the Policies.  (cc)Interim Services has the meaning
ascribed thereto in the Services Agreement.  (dd)Joinder Agreement has the meaning
ascribed thereto in the second recital hereof.  (ee)Loss or Losses has the meaning ascribed thereto in the Master
Agreement.  (ff)Master Agreement has the meaning set
forth in the second recital hereof.  (gg)Ongoing Services has the meaning
ascribed thereto in the Services Agreement.  6


(hh)Penn Life Retrocession Agreement has
the meaning ascribed thereto in the Amendment.  (ii)Permitted Transactions has the meaning
ascribed thereto in the Master Agreement.  (jj)Person has the meaning ascribed
thereto in the Master Agreement.  (kk)Policies means each of those insurance
policy contracts and/or annuity contracts issued or assumed by the Ceding
Company (i) prior to 12:01 a.m. (New York time) on the Coinsurance
Effective Dateand that are
identified by policy form number and/or plan code on Exhibit A attached hereto and that
are in effect on the Coinsurance Effective Date or (ii) that are
reinstated in, or otherwise the subject of, a Permitted Transaction.  Policies shall not include any insurance
policy contracts and/or annuity forms (including any net retained liabilities
of the Ceding Company thereunder) in respect of which the Ceding Company has
ceded all or a portion of the liabilities thereunder to Wilton Reassurance
Company pursuant to the Wilton Re Agreements.  (ll)Policyholder has the meaning ascribed
thereto in the Master Agreement.  (mm)Premium Taxes means the taxes,
assessments, and fees imposed on premiums relating to the Policies by any
state, local, or municipal taxing authority together with any related interest,
penalties and additional amounts imposed by any taxing authority with respect
thereto, including retaliatory taxes.  (nn)Producer has the meaning ascribed
thereto in the Master Agreement.  (oo)Producer Agreementmeans any written, oral or other agreement
or contract between the Ceding Company and any Producer, or among or between
Producers, including any assignments of compensation thereunder, and relating
to the solicitation, sale, marketing, production or servicing of any of the
Policies.  (pp)Producer Payments has the meaning ascribed
thereto in the Master Agreement.  (qq)Recapture Fee has the meaning ascribed
thereto in the Amendment.  (rr)Reconciliation Amount has the meaning
set forth in Section 3.1(c).  (ss)Regulation has the meaning set forth
in Section 9.13.  (tt)Reinsurance Coverage means all
contracts, agreements and treaties of reinsurance between the Ceding Company
and any Third Party Reinsurer that are in force and effect as of the
Coinsurance Effective Date and cover risks associated with the Policies or any
portions thereof.  (uu)Reinsurer has the meaning set
forth in the Preamble.  7


(vv)Reinsurer Caused Extra Contractual Liabilities
has the meaning set forth in Section 6.2(d).  (ww)Reinsurer Covered Extra Contractual Liabilities
has the meaning set forth in Section 6.2(e) (subject to the
limitations therefor in Section 6.2) .  (xx)Reinsurer Indemnified Parties has the
meaning set forth in Section 6.1.  (yy)Required Services has the meaning
ascribed thereto in the Services Agreement.  (zz)SAP means the statutory accounting
practices and procedures required or permitted by the insurance regulatory
authority in the Ceding Companys state of domicile, consistently applied
throughout the specified period and in the immediately prior comparable period.  (aaa)Services Agreement means the services
agreement entered into among the Ceding Company, several Affiliates of the
Ceding Company and the Reinsurer of even date herewith.  (bbb)Settlement Amount means the amount of
the initial reinsurance premium payment to be made at Closing by the Ceding
Company to the Reinsurer in consideration of the reinsurance of the Policies
under this Agreement, which shall be in an amount calculated pursuant to Schedule 3.1 attached hereto.  (ccc)Statutory Reserves and Liabilities
means the sum of all of the reserve items (including reserve items for claims
incurred but not reported and claims in the course of settlement) maintained by
the Ceding Company for the Policies, net of Reinsurance Coverage, as set forth
in Exhibit A attached
hereto.  Exhibit B attached hereto sets forth the Statutory
Reserves and Liabilities by Policy as of the Coinsurance Effective Date, as
such schedule may be adjusted pursuant to Section 3.1 of this
Agreement.  (ddd)Third Party Reinsurer has the meaning
ascribed thereto in the Master Agreement.  (eee)Transaction Documents means this
Agreement, the Master Agreement, the Penn Life Retrocession Agreement and the
Services Agreement.  (fff)Transferred Assets means the cash,
cash equivalents and other assets transferred as part of the Settlement Amount
and as set forth on Exhibit C
attached hereto. Such Transferred Assets shall be valued as of the Closing Date
according to the mechanics set forth on Exhibit C.  (ggg)Transition Date has the meaning
ascribed thereto in the Services Agreement.  8


(hhh)Wilton ReAgreements
has the meaning ascribed thereto in the Amendment.  Section 1.2.  Construction.  For the purposes of this Agreement, (i) words
(including capitalized terms defined herein) in the singular shall be held to
include the plural and vice versa and words (including capitalized terms
defined herein) of one gender shall be held to include the other gender as the
context requires; (ii) the terms hereof, herein and herewith and
words of similar import shall, unless otherwise stated, be construed to refer
to this Agreement as a whole (including all of the Schedules) and not to any
particular provision of this Agreement, and Article, Section, paragraph and
Schedule references are to the Articles, Sections, paragraphs and Schedules to
this Agreement, unless otherwise specified; (iii) the word including and
words of similar import when used in this Agreement shall mean including,
without limitation; (iv) all references to any period of days shall be deemed
to be to the relevant number of calendar days unless otherwise specified; and (v) all
references herein to $ or Dollars shall refer to United States dollars,
unless otherwise specified.  Section 1.3.  Headings.  The Article and Section headings contained
in this Agreement are inserted for convenience of reference only and shall not
affect the meaning or interpretation of this Agreement.  ARTICLE II  BASIS OF COINSURANCE  Section 2.1.  Coinsurance.  (a)Subject to the
terms and conditions of this Agreement, effective as of the Coinsurance
Effective Date, the Ceding Company hereby cedes to the Reinsurer, and the
Reinsurer hereby accepts and reinsures on a one hundred percent (100%)
coinsurance basis, the Insurance Liabilities. The Ceding Company and the
Reinsurer mutually agree that, as between the parties, on and after the
Coinsurance Effective Date, the Reinsurer shall be entitled to exercise all
contractual rights and privileges of the Ceding Company under the Policies in
accordance with the terms, provisions and conditions of such Policies.  (b)In no event
shall such coinsurance with respect to a particular Policy be in force and
binding unless such underlying Policy as issued or assumed by the Ceding
Company is in full force and binding as of the Coinsurance Effective Date or is
the subject of a Permitted Transaction following the Coinsurance Effective
Date.  (c)With respect to
each of the Policies, the amount of coinsurance hereunder shall be maintained
in force without reduction so long as the Policy remains in full force without
reduction. If there is a reduction with respect to a Policy, the Reinsurers
liability with respect thereto shall be equally reduced.  All coinsurance for which the Reinsurer is liable
hereunder shall be subject to the same rates, terms, conditions, limitations
and restrictions as are contained in the Policy.  9


Section 2.2.  Duration of Coinsurance; Recapture.  The coinsurance provided under this Agreement
shall remain continuously in force.  The
Policies are not eligible for recapture by the Ceding Company.  Section 2.3.  Parties to Coinsurance.  Article II of this Agreement
provides for indemnity reinsurance solely between the Ceding Company and the
Reinsurer. The acceptance of reinsurance under this Article II
shall not create any right or legal relation between the Reinsurer and any
Policyholder, insured, claimant or beneficiary under a Policy, and the Ceding
Company shall be and remain solely liable to such Policyholder under the
Policy.  ARTICLE III  CLOSING AND CONSIDERATION  Section 3.1.  Settlement Amount.  (a)On the Closing
Date, the Ceding Company agrees to pay the Reinsurer an amount, in the form of
Transferred Assets as designated and valued as of the Closing Date pursuant to
the mechanics set forth on Exhibit C,
equal to the difference between an estimate of: (i) Statutory Reserves and
Liabilities, minus (ii) due and deferred premiums on the Policies as of
the Coinsurance Effective Date, minus (iii) policy loans outstanding on
the Policies as of the Coinsurance Effective Date (net of any accrued and
unearned policy loan interest on such policy loans), minus (iv) the
Closing Date Ceding Commission as set forth on Schedule 3.1 attached hereto, plus (v) the portion of the
Closing Fee due and payable by the Ceding Company to the Reinsurer, as
reflected on Schedule H to the Amendment (collectively, the Settlement Amount). The Settlement
Amount plus interest accrued thereon, as contemplated in Section 2.1 of
the Master Agreement, shall be remitted by the Ceding Company to the Reinsurer
to an account(s) designated in writing by the Reinsurer. Items (i) through
(iii) of this Section 3.1(a) shall reflect the amounts
reported by the Ceding Company as of the quarter-ended immediately preceding
the Closing Date.  (b)The parties
agree to make adjustments to Exhibit A
andExhibit Battached hereto
and to the Settlement Amount following Closing, based upon (i) Statutory
Reserves and Liabilities for (x) any Policies or Policy claims improperly
or inadvertently omitted or miscalculated in determining the Settlement Amount
or (y) any Policies that were or are the subject of Permitted Transactions
and that were omitted from the calculation of the Settlement Amount as of the
Coinsurance Effective Date, (ii) adjustments to the Closing Date Ceding
Commission pursuant to Section 2.2(d) of the Master Agreement, and (iii) actual
amounts as reported by the Ceding Company as of the Coinsurance Effective Date
for items (i) through (iii) in Section 3.1(a) (such adjusted
amount, the Final Settlement Amount);
provided, however, that any such adjustments made pursuant to
clause (i)(x) will require the prompt prior written consent of the
Reinsurer, which consent shall not be unreasonably withheld, but no such
adjustment will be made pursuant to clause (i)(x) unless the Ceding
Company has notified the Reinsurer in writing of such adjustment prior to the
ninetieth (90th) day following
the Closing Date.  10


(c)The Final
Settlement Amount will be calculated by the Ceding Company and reported to the
Reinsurer prior to the one hundred twentieth (120th) day following the Closing Date, and if such
difference between the Final Settlement Amount and the Settlement Amount (such
difference, the Reconciliation Amount)
is (i) a positive number, then the Ceding Company shall pay such
Reconciliation Amount to the Reinsurer by wire transfer of immediately
available funds or (ii) a negative number, then the absolute value of such
negative number, as the Reconciliation Amount, shall be paid by the Reinsurer
to the Ceding Company by wire transfer of immediately available funds.  (d)The Reinsurer
shall have ten (10) Business Days to review the Ceding Companys calculations
of the Final Settlement Amount and the Reconciliation Amount and provide
written notice to the Ceding Company of any dispute regarding the Ceding
Companys calculation of such amounts (a Dispute
Notice). The Ceding Company and the Reinsurer shall cooperate
in good faith to resolve such dispute as promptly as practicable and, upon such
resolution, make any adjustments to the calculation of any amount(s) contained
in the Ceding Companys calculations of the Final Settlement Amount and the
Reconciliation Amount with the agreement of the Ceding Company and the
Reinsurer. If the Ceding Company and the Reinsurer are unable to resolve any
such dispute within twenty (20) Business Days (or such longer period as the
Ceding Company and the Reinsurer shall mutually agree in writing) of the
Reinsurers delivery of such Dispute Notice, such dispute shall be resolved by
the Independent Accounting Firm, and such determination by the Independent
Accounting Firm shall be final and binding on the parties; provided that
the Reinsurer and the Ceding Company shall submit to the Independent Accounting
Firm statements with respect to their respective positions on disputed issues
and will cooperate with the Independent Accounting Firm by promptly providing
any requested information. Any expenses relating to the engagement of the
Independent Accounting Firm in respect of its services pursuant to this Section 3.1(d)
shall be shared fifty percent (50%) by the Reinsurer and fifty percent (50%) by
the Ceding Company. The Independent Accounting Firm shall be instructed to use
reasonable best efforts to perform its services within thirty (30) Business
Days of submission by the Reinsurer and the Ceding Company of their respective
statements with respect to the disputes and, in any case, as promptly as
practicable after such submission. If no Dispute Notice is timely delivered by
the Reinsurer, the Ceding Companys calculations of the Final Settlement Amount
and the Reconciliation Amount shall be determinative. If a Dispute Notice is timely
delivered by the Reinsurer, the amounts determined pursuant to the resolution
of such dispute in accordance with this Section 3.1(d), shall be
the Final Settlement Amount and Reconciliation Amount.  (e)With respect to
each adjustment which shall enter into the calculation of the Final Settlement
Amount and the Reconciliation Amount, interest shall accrue thereon at an
annual rate equal to the Three-Month London Interbank Offering Rate (LIBOR) as
published in the Money Rate Section (or any successor section) of The Wall
Street Journal (or any successor publication) on the (A) Closing Date,
with respect to adjustments made other than pursuant to clause (b)(i)(y) above,
and (B) effective date of a Permitted Transaction with respect to
adjustments made pursuant to clause (b)(i)(y) above. Such interest shall
accrue from the Closing Date (or the effective date of the Permitted
Transaction, as the case may be) to the date the Reconciliation Amount is paid,
which payment date shall be the fifth (5th) Business Day following the later of (i) the
receipt by the Reinsurer of calculation of the Final Settlement Amount and
Reconciliation Amount, and (ii) the resolution of any dispute in respect
of the  11


calculation of the Final
Settlement Amount and/or the Reconciliation Amount (the Final Settlement Date).  ARTICLE IV  COOPERATION BETWEEN THE CEDING COMPANY AND THE REINSURER FOLLOWING THE COINSURANCE EFFECTIVE DATE  Section 4.1.  Ceding Company Service Period.  During the Ceding Company Service Period, the
Ceding Company shall provide, or cause to be provided, Interim Services,
Conversion Services and Ongoing Services in accordance with the Services
Agreement. On and after the Transition Date, the Reinsurer shall provide, or
cause to be provided, Required Services under the terms and conditions of the
Services Agreement.  Section 4.2.  Premium Payments, Negotiation of Checks.  (i) On and after the Coinsurance
Effective Date, all premium payments, conversion charges and other
consideration under the Policies received by the Ceding Company shall be the
sole property of the Reinsurer, and (ii) any premium payment, conversion
charge and other consideration received by the Ceding Company, to the extent
such premium payment, conversion charge and other consideration covers periods
on or after the Coinsurance Effective Date, shall be remitted in accordance
with the Services Agreement.  Section 4.3.  Reserves. The Reinsurer agrees that,
on and after the Coinsurance Effective Date, it will establish and maintain all
statutory reserves and liabilities as may be required under the terms of the
Policies, SAP and Applicable Law.  Section 4.4.  Reserve Credits. If, as of the end of
any calendar quarter following the Coinsurance Effective Date, the Ceding
Company becomes unable to take full reserve credit with respect to all the
reinsurance provided under this Agreement by the Reinsurer of the Policies for
whatever reason, the Reinsurer will implement, prior to the date on which the
Ceding Company is required by Applicable Law to file its quarterly statutory
financial statement as of and for the period ended on such calendar quarter
end-date with its domiciliary insurance regulatory authority, alternative
arrangements in accordance withApplicable
Law in order to ensure that the Ceding Company is permitted to take such
reserve credit on the Ceding Companys statutory financial statements.  Section 4.5.  Premium Taxes.  The Ceding Company shall be liable for all
Premium Taxes on premiums received in connection with the Policies prior to the
Coinsurance Effective Date and shall remain liable for payment of Premium Taxes
on premiums received under the Policies. The Reinsurer shall pay to the Ceding
Company a provision for Premium Taxes incurred in connection with premiums
received under the Policies on or after the Coinsurance Effective Date.  The provision for Premium Taxes to be paid by
the Reinsurer pursuant to the immediately preceding sentence shall be two and
one-half percent (2.5%) of premiums collected as ceded under this Agreement (as
such percentage may be changed annually on a prospective basis by the mutual
agreement of the parties to reflect actual experience, which agreement by each
party shall not be unreasonably withheld, delayed or conditioned), as  12


calculated on a quarterly
basis, and shall be paid by the Reinsurer to the Ceding Company as part of the
monthly and annual settlements that occur under this Agreement.  Section 4.6.
 Payments Relating to Commissions.
The Reinsurer shall pay to the Ceding Company those payments set forth on Schedule 4.6, which shall be reflected in
the monthly settlement report prepared and delivered pursuant to Section 4.9.  Section 4.7.  Guaranty Fund Assessments.  (a)Ceding
Company-Paid Assessments. In the event the Ceding Company is required
to pay an assessment in respect of the Policies to any insurance guaranty,
insolvency or other similar fund maintained by any jurisdiction and such
assessment is based on premiums collected or policies in full force in any
period on or after the Coinsurance Effective Date, the portion, if any, of such
assessment that relates to such Policies shall be reimbursed by the Reinsurer
to the extent that no Premium Tax offsets are available for use by the Ceding
Company.  Such reimbursement shall be
included in the monthly and annual settlements that occur under this Agreement.  (b)Reinsurer-Paid
Assessments. In the event the Reinsurer is required to pay an
assessment in respect of the Policies to any insurance guaranty, insolvency or
other similar fund maintained by any jurisdiction and such assessment is based
on premiums collected or policies in force in any period prior to the
Coinsurance Effective Date, the portion, if any, of such assessment that
relates to such Policies shall be reimbursed by the Ceding Company to the
extent that no Premium Tax offsets are available for use by the Reinsurer.  Section 4.8.  Reports.  The parties hereto acknowledge and agree that
the regularity and reliability of information concerning the Policies is
critically important to each such party. In connection therewith, each of the
Ceding Company and the Reinsurer agrees to, and agrees to cause their
respective designees to, comply with its respective reporting obligations as
set forth in this Agreement and the Services Agreement within the time periods
contemplated herein and therein.  Section 4.9.  Monthly Settlement.  (a)The Ceding
Company shall provide the Reinsurer with a monthlysettlement report, no later
than the thirtieth (30th) day following
the end of each calendar month, with delivery thereof commencing in the month
following the month in which the Coinsurance Effective Date occurs (including
in such first report the period since the Coinsurance Effective Date). Such
monthly settlement report shall be in the form specified in Schedule 4.9 attached hereto.  (b)In the event
that such monthly settlement report reflects a net amount owed by the Ceding
Company to Reinsurer pursuant to the terms of this Agreement, then the Ceding
Company shall also make a wire payment in immediately available funds of such
net amount to the account(s) designated therefor in writing by the
Reinsurer no later than the tenth (10th) Business Day following Reinsurers receipt of such
monthly settlement report, except to the extent that the Reinsurer notifies the
Ceding Company in writing prior to the expiration of such ten (10) Business
Day period of its good faith belief that the report is inaccurate, in which  13


case the parties shall
cooperate with each other to resolve the disagreement. In the event that a
monthly settlement report reflects a net amount owed by Reinsurer to the Ceding
Company pursuant to the terms of this Agreement, Reinsurer shall make a wire
payment in immediately available funds of such net amount to the Ceding Company
no later than the tenth (10th) Business Day following Reinsurers receipt of such monthly settlement
report, except to the extent that the Reinsurer notifies the Ceding Company
prior to the expiration of such ten (10) Business Day period of its good
faith belief that the report is inaccurate, in which case the parties shall
cooperate with each other to resolve the disagreement.  In the event of any such dispute, the party
owing any amount pursuant to such monthly settlement report shall pay such
amount in full no later than the fifth (5th) Business Day following settlement of such dispute.
Any delinquent amounts payable under this clause (b) shall accrue interest
from the date such payment was originally due until the date such payment is
made, such interest to accrue at an annual rate equal to the Three-Month London
Interbank Offering Rate (LIBOR) as published in the Money Rate Section (or
any successor section) of The Wall Street Journal, Eastern Edition (or any
successor publication) as determined on the date such payment was originally
due.  (c)Pursuant to the
terms of the Services Agreement, from and after the Transition Date, the
Reinsurer shall be responsible for, among other things, the direct payment to
Policyholders or their beneficiaries, as applicable, of all death, annuity and
other contractual benefits constituting Insurance Liabilities under the
Policies.  Any such payment by the
Reinsurer shall satisfy, on a dollar-for-dollar basis, the Reinsurers
obligations to the Ceding Company in respect thereof under this Agreement.  Section 4.10.  Audit. Each party shall have the right
to audit on an annual basis, at its sole expense, at the office of the other
during regular business hours and upon reasonable prior written notice, all
records and procedures relating to the Policies.  Section 4.11.  Non-Guaranteed Elements.  (a)For the period
beginning on the Closing Date and continuing up to and including the Transition
Date, the Ceding Company shall make such changes to the non-guaranteed elements
under the Policies as are requested in writing by the Reinsurer or its
designees. The Ceding Company shall make no changes to such non-guaranteed
elements except those requested in writing by the Reinsurer or its designees,
or as otherwise may be required by Applicable Law.  (b)For all periods
following the Transition Date, the Ceding Company acknowledges and agrees that (i) the
Reinsurer and its designees have sole discretion to make changes to the
non-guaranteed elements of the Policies to the extent that such changes are in
accordance with the terms of the Policies and Applicable Law, and (ii) it
shall not make any such changes to such non-guaranteed elements except those
requested in writing by the Reinsurer or as otherwise may be required by
Applicable Law.  14


ARTICLE V  UNDERTAKINGS OF CEDING COMPANY FOLLOWING THE COINSURANCE EFFECTIVE DATE  Section 5.1.  Cooperation. The Ceding Company agrees
to provide all reasonable assistance to the Reinsurer and its designees in the
transfer to the Reinsurer of the obligation to provide Required Services
pursuant to the Services Agreement in connection with the Policies, including
responding to questions from the Reinsurer and its designees in the conversion
of computer records and files to the systems of the Reinsurer. The Ceding
Company will do all things reasonable and necessary to permit the Reinsurer and
its designees to exercise and assert all rights of the Ceding Company as
contemplated herein and will fully cooperate with the Reinsurer and its
designees in such exercise and assertion.  ARTICLE VI  INDEMNIFICATION  Section 6.1.  Indemnification by the Ceding Company.  From and after the Closing Date, the Ceding
Company shall indemnify and defend the Reinsurer, its Approved Designees and
its Affiliates, and their respective officers, employees, directors,
controlling persons, Affiliates, agents, representatives and assigns (the Reinsurer Indemnified Parties)
against, and hold each of them harmless from all Losses sustained or incurred
by, or asserted against, the Reinsurer Indemnified Parties which arise out of:  (a)any Excluded Liabilities;  (b)any breach or
nonfulfillment by the Ceding Company of, or any failure by the Ceding Company
to perform, any of the covenants, terms or conditions of, or any of its duties
or obligations under, this Agreement;  (c)any action or
inaction of the Ceding Company or its designees under or with respect to any of
the Policies that is not indemnifiable by the Reinsurer pursuant to Section 6.2;  (d)or relate to or
are in connection with the Wilton Re Agreements;  (e)the amount of
the Cost of Capital for any Interest Maintenance Reserve that the Reinsurer
becomes obligated to establish under SAP as a liability as of the Coinsurance
Effective Date or as of the Closing Date on its statutory financial statements
solely as a result of the reinsurance by the Reinsurer of the Insurance
Liabilities contemplated by this Agreement, the amount of such Interest
Maintenance Reserve (if any) being determined by reference to the schedule to
be provided by the Ceding Company to the Reinsurer as promptly as practicable
following the determination thereof; and  (f)any enforcement
of this indemnity.  15


Section 6.2.  Indemnification by the Reinsurer. From
and after the Closing Date, the Reinsurer shall indemnify and defend the Ceding
Company and its Affiliates, its Approved Designees, and their respective
officers, employees, designees, directors, controlling persons, Affiliates,
agents, representatives and assigns (the Ceding
Company Indemnified Parties) against, and hold each of them
harmless from, all Losses sustained or incurred by, or asserted against, the
Ceding Company Indemnified Parties which arise out of:  (a)any Insurance
Liabilities;  (b)any breach or
nonfulfillment by the Reinsurer of, or any failure by the Reinsurer to perform,
any of the covenants, terms or conditions of or any of its duties or
obligations under this Agreement;  (c)any action or
inaction of the Reinsurer or its designees under or with respect to any of the
Policies;  (d)any Extra
Contractual Liabilities and any related attorneys fees and expenses that are
based upon, relate to or arise solely out of any act, error or omission of (i) the
Reinsurer or any of its officers, directors, designees, agents or employees,
whether intentional or otherwise, which occurred after the Closing Date
(including in connection with the Reinsurers or its designees (x) exercise
of contractual rights and privileges of the Ceding Company under the Policies
pursuant to the Transaction Agreements, including pursuant to Sections
2.1(a) and 4.11 of this Agreement, and (y) performance of
Required Services under the Services Agreement after the Transition Date),
except to the extent such act, error or omission was made at the written or
express direction or request of the Ceding Company or its designees, and (ii) the
Ceding Company or any of its officers, directors, designees, agents or
employees that occurred (or, in the case of an omission, failed to occur) on or
after the Closing Date and was made at the written or express direction or
request of the Reinsurer or its designees (Reinsurer Caused Extra Contractual Liabilities);  (e)Extra
Contractual Liabilities and any related attorneys fees and expenses that are
based upon, relate to or arise solely out of any act, error or omission of the
Ceding Company or any of its officers, directors, designees, agents or
employees, whether intentional or otherwise, with respect to the Policies
(other than those acts, errors or omissions covered by Section 6.2(d)(ii)),
in respect of which relief is first sought by the aggrieved Person from the
Ceding Company, the Reinsurer or any of their respective Affiliates or
designees after April 24, 2014 (Reinsurer
Covered Extra Contractual Liabilities); and  (f)any enforcement
of this indemnity.  Notwithstanding anything to
the contrary herein, in no event shall the Reinsurer be obligated to indemnify
the Ceding Company Indemnified Parties for Losses arising in respect of
any Reinsurer Covered Extra Contractual Liabilities pursuant to Section 6.2(e)
that exceed, individually or in the aggregate, the ECL Cap.  In addition, the Ceding
Company agrees, and agrees to cause each other Ceding Company Indemnified
Party, to use commercially reasonable efforts to seek recoveries under all
applicable insurance or reinsurance policies or other indemnity, contribution
or similar agreements in  16


respect of any Losses
arising in respect of Reinsurer Covered Extra Contractual Liabilities. In the
event that any Ceding Company Indemnified Party is able to make any actual
recovery under any such insurance or other agreement, the Reinsurer shall not
have any liability to the Ceding Company hereunder for such amount and, in the
event that the Reinsurer has already made an indemnification payment to the
Ceding Company Indemnified Parties for such amount, the Ceding Company shall
reimburse Reinsurer for such payments to the extent any Ceding Company
Indemnified Parties received reimbursement under such insurance or other
agreement. Payments made by the Reinsurer but later reimbursed by any Ceding
Company Indemnified Party pursuant to the immediately preceding sentence shall
not be applied against the ECL Cap.  Section 6.3.  Indemnification and Arbitration Procedures.
The arbitration procedures under Article VIII of this Agreement
shall apply to indemnity claims and disputes arising under this Agreement, and
are incorporated herein by reference. The rights and obligations of the parties
respecting indemnification under this Agreement shall be subject to the
limitations described in Article VIII of this Agreement.  Section 6.4.  Cooperation. Each party agrees that it
will cooperate fully with the other party in the satisfactory settlement of any
and all claims, insofar as possible.  Section 6.5.  Payment in Full for Losses. To the
extent a Reinsurer Indemnified Party or a Ceding Company Indemnified Party
receives indemnification in full for a Loss under any Transaction Agreement,
such party shall not be entitled to further indemnification under the same or
any other Transaction Agreement.  ARTICLE VII  INSOLVENCY  Section 7.1.  Payment of Benefits under an Insolvency.
The obligations of the Reinsurer under this Agreement shall be without
diminution or in any way affected or diminished because of the insolvency of
the Ceding Company. In the event of the insolvency of the Ceding Company and
the appointment of a conservator, liquidator, receiver or statutory successor
of the Ceding Company while coinsurance is in effect as to any Policy, all
coinsurance made, ceded, renewed or otherwise becoming effective under this
Agreement shall be payable directly to such conservator, liquidator, receiver
or statutory successor immediately upon demand, with reasonable provision for verification,
on the basis of claims allowed against the Ceding Company by any court of
competent jurisdiction or by any conservator, liquidator, receiver or statutory
successor of the Ceding Company having authority to allow such claims, without
diminution because of such insolvency or because such conservator, liquidator,
receiver or statutory successor has failed to pay all or a portion of any
claims, except where (x) this Agreement specifies another payee of such
reinsurance in the event of the insolvency of the Ceding Company or (y) the
Reinsurer, with the consent of the direct insured or insureds, has assumed such
policy obligations of the Ceding Company as direct obligations of the Reinsurer
to the payees under such Policies and in substitution for the obligations of
the Ceding Company to such payees.  17


Section 7.2.
Required Notice of and Defense against Claims. In the event of the
insolvency of the Ceding Company while coinsurance as to any Policy is in
effect under this Agreement, the conservator, liquidator, receiver or statutory
successor of the Ceding Company shall give the Reinsurer written notice of the
pendency of a claim against the Ceding Company on a Policy within a reasonable
time after such claim is filed in the insolvency proceeding. During the
pendency of any such claim, the Reinsurer may, at its own expense, investigate
such claim and interpose, at its own expense, in the proceeding where such
claim is to be adjudicated, any defense or defenses which the Reinsurer may
deem available to the Ceding Company or its conservator, liquidator, receiver
or statutory successor. The expense thus incurred by the Reinsurer shall be
payable, subject to court approval, out of the estate of the Ceding Company as
a part of the expense of conservation or liquidation to the extent of a
proportionate share of the benefit which may accrue to the Ceding Company in
conservation or liquidation solely as a result of the defense undertaken by the
Reinsurer. Where two or more reinsurers are involved in the same claim and a
majority in interest elects to interpose the defense to such claim, the expense
shall be apportioned in accordance with the terms of this Agreement as though
such expense had been incurred by the insolvent Ceding Company.  ARTICLE VIII  ARBITRATION  Section 8.1.
Agreement to Arbitrate. It is the intention of the parties that customs
and usages of the business of life insurance or reinsurance and annuities shall
be given full effect in the interpretation of this Agreement. All disputes
between the Reinsurer and the Ceding Company arising out of this Agreement
(other than disputes arising with respect to the formation and validity of this
Agreement) on which an amicable understanding cannot be reached shall be
decided exclusively by arbitration between the parties at a location to be
mutually agreed upon between the parties or as designated by the arbitrators if
agreement as to a location cannot be reached by the parties. Notwithstanding
any other provision of this Article VIII, if either the Reinsurer
or the Ceding Company seeks, consents to, or acquiesces in the appointment of
or otherwise becomes subject to any trustee, receiver, liquidator, statutory
successor or conservator (including any state insurance regulatory agency or
authority acting in such a capacity), the other party shall not be obligated to
resolve any claim, dispute or cause of action under this Agreement by
arbitration except as may be required by Applicable Law. Notwithstanding any
other provision of this Article VIII, nothing contained in this
Agreement shall require arbitration of any issue for which equitable or
injunctive relief, including specific performance, is the sole remedy sought.  Section 8.2.
Method. The parties intend this Article VIII to be
enforceable in accordance with the Federal Arbitration Act (9 U.S.C. Section 1,
et seq.), including any amendments to that Act which are subsequently adopted,
notwithstanding any other choice of law provision set forth in this Agreement.
In the event that either party refuses to submit to arbitration as required
herein, the other party may request a United States Federal District Court to
compel arbitration in accordance with the Federal Arbitration Act. Both parties
consent to the jurisdiction of such court to enforce this article and to
confirm and enforce the performance of any award of the arbitrators.
Arbitration shall be conducted before a three-person arbitration panel
appointed as follows: to initiate arbitration, either party shall notify the
other in writing in  18


the manner set forth in this
Agreement for sending notices to the parties of its desire to arbitrate,
stating the nature of the dispute and the remedy sought, and designating an
arbitrator. The party to which the notice is sent shall respond in writing no
later than the thirtieth (30th) day following its receipt of such notice. If the second party fails
to respond within the time period set forth in this Section 8.2, or
fails to designate its arbitrator in its response, the party initiating
arbitration shall appoint a second arbitrator. The two arbitrators shall select
an umpire no later than the thirtieth (30th) day following the designation of the second
arbitrator. If they are unable to agree upon the selection of the umpire on or
prior to the thirtieth (30th) day following the appointment of the second arbitrator, the parties
shall appoint the umpire pursuant to the ARIAS-US Umpire Selection Procedure.
The arbitrators and umpire shall be either present or former executive officers
of life insurance or reinsurance companies, be certified to act as arbitrators
or umpires by ARIAS-US, shall not be under the control of either party and
shall have no financial interest in the outcome of the arbitration and shall
have no conflict of interest with any party hereto (or its Affiliates) or the
subject matter of the arbitration.  Section 8.3.
Power of Arbitrators. The arbitrators shall have the power to determine
all procedural rules for the conduct of the arbitration, including the
production and inspection of documents, the examination of witnesses and any
other matter relating to the conduct of the arbitration. The arbitrators and
the umpire shall interpret this Agreement as an honorable engagement and not
merely as a legal obligation between the parties. They shall reach their decision
from the standpoint of equity and the customs and practices of the life
insurance or reinsurance industry with a view to effecting the general purposes
of this Agreement and may abstain from following the strict rules of law; provided,
however, that (i) the arbitrators shall have no authority to award
equitable relief or punitive damages against or in favor of either party
(except to reimburse a party for extra-contractual or punitive damages that
either the Ceding Company or the Reinsurer has paid or is legally obligated to
pay to third parties), and (ii) nothing contained in this Article VIII
is intended to limit the dispute resolution mechanics for (x) calculations
made pursuant to Section 3.1 or Exhibit C
(which disputes shall be resolved pursuant to the procedures set forth in Section 3.1
or Exhibit C, as applicable),
or (y) Section 9.13.  Section 8.4.
Arbitration Fees and Expenses; Decision. Unless the arbitration panel
orders otherwise, each party shall pay: (1) the fees and expenses of its
own arbitrator; and (2) an equal share of the fees and expenses of the
umpire and the other expenses of the arbitration. Each party shall pay its own
legal fees in connection with the arbitration, unless the arbitrators award
legal fees and expenses of the prevailing party as part of any award. Except as
otherwise specifically provided herein, the arbitration shall be conducted in
accordance with the procedures of the American Arbitration Association. The
decision of the arbitrators shall be made in writing and final and binding upon
both of the parties. Judgment may be entered upon the final decision of the
arbitrators in any court having jurisdiction. The arbitration will be conducted
on a confidential basis, except to the extent otherwise required by Applicable
Law, and no matters discussed or disclosed by any party at the arbitration, or
any decision or award of the arbitrators, will be admitted into evidence or
otherwise disclosed or used before any court or other legal, regulatory or
administrative body, authority or forum for any purpose except as and to the
extent necessary for entry of final judgment on the award of the arbitrators in
any court having jurisdiction.  19


ARTICLE IX  GENERAL PROVISIONS  Section 9.1.
Notices. Any and all notices and other communications required or
permitted under this Agreement shall be in writing and shall be deemed to have
been duly given when (i) received by the receiving party if mailed by
United States registered or certified mail, return receipt requested, (ii) received
by the receiving party if mailed by United States overnight express mail, (iii) sent
by facsimile or telecopy machine, followed by confirmation mailed by United
States first-class mail or overnight express mail or (iv) delivered in
person to the parties at the addresses set forth in the Master Agreement.  Section 9.2.
Confidentiality. Each of the parties shall maintain the confidentiality
of all information related to the Policies and all other information
denominated as confidential by the other party provided to it in connection
with this Agreement to the extent required by and subject to all of the terms
and provisions of Section 11.7 of the Master Agreement.  Section 9.3.
Misunderstandings and Oversights. If any failure to pay amounts due or
to perform any other act required of either party under this Agreement is shown
to be unintentional and caused by misunderstanding, oversight or clerical
error, then this Agreement shall not be deemed in breach thereby, provided,
that such failure is promptly corrected by the party that caused such failure,
which correction restores the other party to the position it would have
occupied (including provision for the time value of money) had the
misunderstanding, oversight or clerical error not occurred.  Section 9.4.
Reinstatements. If a Policy that was reduced, terminated, or lapsed is
reinstated in a Permitted Transaction, the reinsurance for such Policy under
this Agreement will be reinstated automatically to the amount that would have
been in force if the Policy had not been reduced, terminated or lapsed.  Section 9.5.
Entire Agreement. This Agreement supersedes all prior discussions and
agreements between the parties with respect to the subject matter of this
Agreement, and this Agreement, the Master Agreement, the Joinder Agreement, the
Penn Life Retrocession Agreement and the Services Agreement, including the
Schedules and Exhibits attached hereto and thereto, constitute the sole and
entire agreement between the parties hereto with respect to the subject matter
hereof, and supersedes all prior discussions and agreements between the parties
with respect to the subject matter hereof, which are merged with and into this
Agreement.  Section 9.6.
Waivers and Amendments. Any term or condition of this Agreement may be
waived at any time by the party that is entitled to the benefit thereof. Such
waiver must be in writing and must be executed by an executive officer of such
party. A waiver on one occasion will not be deemed to be a waiver of the same
or any other term or condition on a future occasion. This Agreement may be
modified or amended only by a writing duly executed by an executive officer of
the Ceding Company and the Reinsurer, respectively.  Section 9.7.
No Third Party Beneficiaries. The terms and provisions of this Agreement
constitute an indemnity reinsurance agreement solely between the Ceding Company  20


and the Reinsurer, and other
than Ceding Company Indemnified Parties and Reinsurer Indemnified Parties, the
terms and provisions of this Agreement are intended solely for the benefit of
the parties hereto, the Ceding Company and the Reinsurer and their permitted
successors and assigns, and it is not the intention of the parties to confer
any rights as a third-party beneficiary to this Agreement upon any other
person.  Section 9.8.
Binding Effect; No Assignment. This Agreement shall be binding upon and
inure to the benefit of the parties and their respective successors, permitted
assigns and legal representatives, whether by merger, consolidation or
otherwise. This Agreement shall not be assigned by any of the parties hereto
without the prior written approval of the other party; provided, that
nothing in this Section 9.8 shall be interpreted to prevent the
retrocession by the Reinsurer of all or any portion of the Insurance
Liabilities, but only after the delivery by the Reinsurer of prior written
notice thereof to the Ceding Company.  Section 9.9.
Governing Law. This Agreement will be governed by and construed in
accordance with the laws of the state of domicile of the Ceding Company,
without regard to its conflicts of law doctrine.  Section 9.10.
Counterparts. This Agreement may be executed in counterparts, each of which
shall be deemed an original, but all of which shall constitute one and the same
instrument.  Section 9.11.
Severability. If any provision of this Agreement is held to be illegal,
invalid or unenforceable under any present or future law or if determined by a
court of competent jurisdiction to be unenforceable, and if the rights or
obligations of the Ceding Company or the Reinsurer under this Agreement will
not be materially and adversely affected thereby, such provision shall be fully
severable, and this Agreement will be construed and enforced as if such
illegal, invalid or unenforceable provision had never comprised a part of this
Agreement, and the remaining provisions of this Agreement shall remain in full
force and effect and will not be affected by the illegal, invalid or
unenforceable provision or by its severance herefrom.  Section 9.12.
Exhibits and Schedules. Exhibits and Schedules attached hereto are
hereby made a part of this Agreement.  Section 9.13.
Election Statement. The parties hereby jointly make the election to
determine specified policy acquisition expenses without regard to the general
deductions limitation described in Internal Revenue Regulation 1.848-2(g)(8) (the
Regulation) under Section 848
of the Code. This Section 9.13 shall constitute the Election
Statement specified in the Regulation and this Election Statement shall be
construed in accordance with all of the requirements of such Regulation
regarding such election, including, without limitation, the election statement
and Tax return reporting requirements of Regulation Sections 1.848-2(g)(8)(ii) and
1.848-2(g)(8)(iii). Pursuant to this Election Statement, the parties agree as
follows:  21


(a)           to exchange information each and every
year for which this Agreement is in effect pertaining to the amount of net
consideration under this Agreement as that term is used in the Regulation. In
order to effect this information exchange, the parties agree that:  (i)            the Ceding Company
shall submit its calculation of the net consideration for purposes of that
Regulation to the Reinsurer not later than May 1st for each and every
taxable year for which this Agreement is in effect;  (ii)           the Reinsurer may
challenge such calculation within ten (10) Business Days of its receipt of
the Ceding Companys calculation;  (iii)          should the
Reinsurer challenge the Ceding Companys calculation of the net consideration
and the parties be unable to agree as to the appropriate methodology to
determine the net consideration for purposes of the Regulation, the parties
shall refer such dispute to an outside tax consultant unrelated to either of
the parties, in lieu of the arbitration provisions of this Agreement, and if
the parties cannot agree on a tax consultant, the tax consultant shall be
Deloitte & Touche LLP, and the parties agree to be bound by the
decision of such tax consultant;  (b)           that the party with net positive
consideration with respect to this Agreement for each taxable year will
capitalize specified policy acquisition expenses with respect to this Agreement
without regard to the general deductions limitation of Section 848(c)(1) of
the Code; and  (c)           that the first taxable year for which
this Election Statement shall be effective is taxable year 2009.  Section 9.14.
Additional Tax Provisions. The parties each agree to attach a schedule
to their federal income Tax returns that identifies this Agreement as a
reinsurance agreement for which the Election Statement in Section 9.13
has been made. This schedule shall be attached to each of the parties federal
income Tax returns filed for the first taxable year of each party ending after
the Election Statement becomes effective.  Section 9.15.
Set Off. Any debts or credits between the Ceding Company and the
Reinsurer under this Agreement only are deemed mutual debts and credits, as the
case may be, and the Ceding Company and the Reinsurer shall have, and may
exercise at any time and from time to time, the right to net or offset any such
debts or credits under this Agreement only and only the balance shall be
allowed or paid hereunder. This right of netting and offset shall not be
affected or diminished because of insolvency of either party to this Agreement.  22


IN WITNESS WHEREOF, the
parties hereto have caused this Agreement to be executed effective this 24th
day of April, 2009.   AMERICAN EXCHANGE LIFE
  INSURANCE COMPANYBy:
  /s/ Gary W. BryantName:
  Gary W. BryantTitle:
  President & CEOCOMMONWEALTH ANNUITY AND
  LIFE INSURANCE COMPANYBy:
  /s/ Michael ReardonName:
  Michael ReardonTitle:
  President   Indemnity Reinsurance Agreement Signature Page


Schedule
3.1  SETTLEMENT
AMOUNT  Statutory Reserves and Liabilities(1)
  
  $
  222,541- Due and deferred premiums(2)
  
  $
  19,892- Policy loans outstanding(2) (net of accrued and unearned
  interest)
  
  $
  138,303- Closing Date Ceding Commission(3)
  
  $
  0+ Portion of Closing Fee(4)
  
  $
  0= Settlement Amount(5)
  
  $
  64,346+ Accrued Interest(6)
  
  $
  207= Total Payment
  
  $
  64,553  
 (1)   Will equal amount on Exhibit A.  (2)   On the Policies as of the Coinsurance
Effective Date.  (3)   Will equal amount determined pursuant to Section 2.2
in the Master Agreement.  (4)   Will equal amount set forth in respect
thereof on Schedule H to the Amendment.  (5)   Interest Maintenance Reserve impact relating
to the Transferred Assets transferred on the Closing Date and the Final
Settlement Date shall be the amount of zero dollars ($0.00).  (6)   Determined pursuant to Section 2.1 in
the Master Agreement.  3.1-1


Schedule 4.6  PAYMENTS RELATING TO COMMISSIONS  4.6-1


AMERICAN
EXCHANGE/MARQUETTE NATIONAL COMMISSIONS  Expressed
as percentage of premium.  Policy
  YearLOB
  
  Plan
  
  IA
  
  1
  
  2
  
  3
  
  4
  
  5
  
  6
  
  7
  
  8
  
  9
  
  10
  
  11+Senior Life
  
  1GD05
  
  0-84
  
  125
  %
  15
  %
  15
  %
  15
  %
  15
  %
  10
  %
  10
  %
  10
  %
  10
  %
  10
  %
  3
  %85+
  
  93
  %
  15
  %
  15
  %
  15
  %
  15
  %
  10
  %
  10
  %
  10
  %
  10
  %
  10
  %
  3
  %1LD05
  
  0-84
  
  130
  %
  15
  %
  15
  %
  15
  %
  15
  %
  10
  %
  10
  %
  10
  %
  10
  %
  10
  %
  3
  %85+
  
  98
  %
  15
  %
  15
  %
  15
  %
  15
  %
  10
  %
  10
  %
  10
  %
  10
  %
  10
  %
  3
  %Traditional
  
  5JDF
  
  All
  
  60
  %
  10
  %
  10
  %
  10
  %
  10
  %
  10
  %
  10
  %
  10
  %
  10
  %
  10
  %
  10
  %5JHW
  
  All
  
  0
  %
  0
  %
  0
  %
  0
  %
  0
  %
  0
  %
  0
  %
  0
  %
  0
  %
  0
  %
  0
  %5JME
  
  All
  
  80
  %
  7.5
  %
  7.5
  %
  7.5
  %
  7.5
  %
  7.5
  %
  7.5
  %
  7.5
  %
  7.5
  %
  7.5
  %
  0
  %5JPW
  
  All
  
  0
  %
  0
  %
  0
  %
  0
  %
  0
  %
  0
  %
  0
  %
  0
  %
  0
  %
  0
  %
  0
  %5JWA1
  
  All
  
  95
  %
  11
  %
  11
  %
  11
  %
  11
  %
  11
  %
  11
  %
  11
  %
  11
  %
  11
  %
  11
  %5JWA3
  
  All
  
  95
  %
  11
  %
  11
  %
  11
  %
  11
  %
  11
  %
  11
  %
  11
  %
  11
  %
  11
  %
  11
  %5JWE
  
  All
  
  95
  %
  11
  %
  11
  %
  11
  %
  11
  %
  11
  %
  11
  %
  11
  %
  11
  %
  11
  %
  11
  %


Schedule 4.9  MONTHLY SETTLEMENT REPORTS  4.9-1


Commonwealth
Annuity and Life Insurance Company (Reinsurer) Sch 4.9 -
Monthly Reinsurance Settlement Statemen For the
Month Ending Jan-09  Pre - Transition Date  (TRAD)COMB
  LOB
  
  (TRAD)
  Whole
  
  (TRAD)
  Term
  
  Universal
  
  (SR)
  Senior
  
  
  
  (AE &
  AEII)
  
  (Grp)
  GroupTOTALS
  
  Life
  
  Life
  
  Life/ISWL
  
  Life
  
  (GR)
  GRL Life
  
  Asset
  Enhancer
  
  Life
  
  (ANN)
  AnnuityTotal
  
  Total
  
  Total
  
  Total
  
  Total
  
  Total
  
  Total
  
  Total
  
  TotalCollected PremiumsA
  
  FY Premium Collected:
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  B
  
  RNL Premium Collected
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  C
  
  Total Collected Premium (with
  waiver) (A+B)
  
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calcPlus Assumed Reinsurance PremiumD
  
  FY Premium Collected:
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  E
  
  RNL Premium Collected
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  F
  
  Total Collected Assumed Reinsurance
  Premium (D+E)
  
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calcLess Inuring Reinsurance PremiumG
  
  FY Premium Collected:
  
  
  
  H
  
  RNL Premium CollectedI
  
  Total Inuring Reinsurance Premium
  (G+H)
  
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calcJ
  
  Net
  Total Premium (C+F-I)
  
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calcPolicy BenefitsK
  
  Death Claims
  (including any interest)
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  L
  
  Surrenders Paid
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  M
  
  Waiver of Premium
  Benefits
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  N
  
  Claim Exp:
  Investigation Fees / Medical Record Fees
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  O
  
  Total Policy Benefits Paid (K+ L+M+N)
  
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calcPlus Assumed Reinsurance Policy
  BenefitsP
  
  Death Claims
  (including any interest)
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  Q
  
  Surrenders Paid
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  R
  
  Waiver of Premium
  Benefits
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  S
  
  Claim Exp:
  Investigation Fees / Medical Record Fees
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  T
  
  Total
  Assumed Reinsurance Policy Benefits Paid (P+Q+R+S)
  
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calcLess Inuring Reinsurance Policy
  BenefitsU
  
  Death Claims
  (including any interest)
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  V
  
  Surrenders Paid
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  W
  
  Waiver of Premium
  Benefits
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  X
  
  Claim Exp:
  Investigation Fees / Medical Record Fees
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  Y
  
  Total
  Inuring Reinsurance Policy Benefits Paid, Payable or Provided(U+V+W+X)
  
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calcZ
  
  Net
  Total Policy Benfits (O+T-Y).
  
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calcLess
  Payments Relating to Commission (per schedule 4.6)AA
  
  FY Commissions
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  AB
  
  RNL Commissions
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  AC
  
  Total Payments Relating to
  Commission (AA+AB)
  
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calcPlus
  Inuring Reinsurance Allowance PaymentsAD
  
  FY Reins
  AllowanceComm & Exp Allowances
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  AE
  
  Single Reins
  AllowanceComm & Exp Allowances
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  AF
  
  RNL Reins AllowanceComm & Exp Allowances
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  AG
  
  Renewal
  Reins AllowanceComm & Exp Allowances Paid, Payable or Provided(AD+AE+AF)
  
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calcLess
  Policy Servicing FeeNumber of days in
  month
  
  # Policies
  Inforce Begining of Month
  
  AH
  
  Policy Servicing
  Fee per Sched 2.3 of ASA (41*Days in Month/365)
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  Less Premium TaxAI
  
  Premium Taxes
  (2.5% Direct Collected Prem)
  
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calcPlus
  Uncollectible Reinsurance Recoverables (Assumed or Inuring)AJ
  
  Plus Change in
  Reinsurance Recoverables Not Admitted**
  
  
  
  AK
  
  Net
  Due to (from) Commonwealth (J - Z - AC+AG-AH-AI+AJ)
  
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc  
 *For purposes of
this calculation, the Inuring Reinsurance shall mean Reinsurance Coverage (as
defined in the coinsurance agreement) **Reinsurance
recoverables (including reinsurance allowances) due greater than 90 days are
not admitted; for purposes of calculation, months change due to new not
admitted or receipt of payment previously not admitted


Commonwealth Annuity and Life Insurance Company (Reinsurer) Sch 4.9 - Monthly Reinsurance Settlement Statement For the Month Ending: Jan-09  Post - Transition Date  (TRAD)COMB LOB
  
  (TRAD) Whole
  
  (TRAD) Term
  
  Universal
  
  
  
  
  
  (AE &
  AEII)
  
  (Grp)
  GroupTOTALS
  
  Life
  
  Life
  
  Life/ISWL
  
  (SR)
  Senior Life
  
  (GR)
  GRL Life
  
  Asset
  Enhancer
  
  Life
  
  (ANN)
  AnnuityTotal
  
  Total
  
  Total
  
  Total
  
  Total
  
  Total
  
  Total
  
  Total
  
  TotalCollected
  PremiumsA
  
  FY Premium Collected:
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  B
  
  RNL Premium
  Collected
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  C
  
  Total
  Collected Premium (with waiver) (A+B)
  
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calcPlus
  Assumed Reinsurance PremiumD
  
  FY Premium
  Collected:
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  E
  
  RNL Premium
  Collected
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  F
  
  Total
  Collected Assumed Reinsurance Premium (D+E)
  
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calcLess
  Inuring Reinsurance PremiumG
  
  FY Premium
  Collected:H
  
  RNL Premium
  CollectedI
  
  Total
  Inuring Reinsurance Premium (G+H)
  
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calcJ
  
  Net
  Total Premium (C+F-I)
  
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calcPolicy
  BenefitsK
  
  Death Claims
  (including any interest)
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  L
  
  Surrenders Paid
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  M
  
  Waiver of Premium
  Benefits
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  N
  
  Claim Exp:
  Investigation Fees / Medical Record Fees
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  O
  
  Total
  Policy Benefits Paid (K + L+M+N)
  
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calcPlus
  Assumed Reinsurance Policy BenefitsP
  
  Death Claims
  (including any interest)
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  Q
  
  Surrenders Paid
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  R
  
  Waiver of Premium
  Benefits
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  S
  
  Claim Exp:
  Investigation Fees / Medical Record Fees
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  T
  
  Total
  Assumed Reinsurance Policy Benefits Paid (P+Q+R+S)
  
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calcLess
  Inuring Reinsurance Policy Benefits *U
  
  Death Claims
  (including any interest)
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  V
  
  Surrenders Paid
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  W
  
  Waiver of Premium
  Benefits
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  X
  
  Claim Exp:
  Investigation Fees / Medical Record Fees
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  Y
  
  Total
  Inuring Reinsurance Policy Benefits Paid, Payable or Provided(U+V+W+X)
  
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calcZ
  
  Net
  Total Policy Benfits (O+T-Y)
  
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calcLess
  Payments Relating to Commission (per schedule 4.6)AA
  
  FY Commissions
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  AB
  
  RNL Commissions
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  AC
  
  Total
  Payments Relating to Commission (AA+AB)
  
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calcPlus
  Inuring Reinsurance Allowance Payments*AD
  
  FY Reins
  AllowanceComm & Exp Allowances
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  AE
  
  Single Reins
  AllowanceComm & Exp Allowances
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  AF
  
  RNL Reins
  AllowanceComm & Exp Allowances
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  AG
  
  Renewal
  Reins AllowanceComm & Exp Allowances Paid, Payable or Provided(AD+AE+AF)
  
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calcLess
  Premium TaxAH
  
  Premium Taxes
  (2.5% Direct Collected Prem)
  
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calcPlus
  Uncollectible Reinsurance Recoverables (Assumed or Inuring)AI
  
  Plus Change in
  Reinsurance Recoverables Not Admitted** (pos is incr NotAdmit)
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  AJ
  
  Net
  Due to (from) Universal American (AC+AH-AI) (positive to UA)
  
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc
  
  calc  
 *For purposes of
this calculation, the Inuring Reinsurance shall mean Reinsurance Coverage (as
defined in the coinsurance agreement) **Reinsurance
recoverables (including reinsurance allowances) due greater than 90 days are
not admitted; for purposes of calculation, months change due to new not
admitted or receipt of payment previously not admitted


Post - Transition Date  COMB
  
  
  
  
  
  
  
  (TRAD)LOB
  
  (TRAD)
  
  
  
  (TRAD)
  
  Universal
  
  
  
  (SR)TOTALS
  
  Whole
  Life
  
  
  
  Term
  Life
  
  Life/ISWL
  
  
  
  Senior
  LifeTotal
  
  Total
  
  REALIC
  
  Total
  
  Total
  
  REALIC
  
  TotalLess Inuring Reinsurance AllowanceX
  
  FY Rein Allow - Comm/Exp
  
  
  
  
  
  
  
  
  
  
  
  
  
  Y
  
  FY Ren Allow - App/Pol Fee
  
  
  
  
  
  
  
  
  
  
  
  
  
  Z
  
  FY Rein Allow - Per Pol Isd NB
  
  
  
  
  
  
  
  
  
  
  
  
  
  AA
  
  FY Rein Allow - Per Rid Isd NB
  
  
  
  
  
  
  
  
  
  
  
  
  
  AB
  
  FY Rein Allow - Per Tel Interv
  
  
  
  
  
  
  
  
  
  
  
  
  
  AC
  
  FY Rein Allow - Per 1K issued
  
  
  
  
  
  
  
  
  
  
  
  
  
  AD
  
  FY Rein Allow - %Prm NB
  
  
  
  
  
  
  
  
  
  
  
  
  
  AE
  
  FY Rein Allow - %Prm MKTG
  
  
  
  
  
  
  
  
  
  
  
  
  
  AF
  
  FY Rein Allow - %Prm Prem Tax
  
  
  
  
  
  
  
  
  
  
  
  
  
  AG
  
  FY Rein Allow - %Prm Netwk Fee
  
  
  
  
  
  
  
  
  
  
  
  
  
  AH
  
  FY Rein Allow - %Prm Maint
  
  
  
  
  
  
  
  
  
  
  
  
  
  AI
  
  FY Rein Allow - %Prm Care Advi
  
  
  
  
  
  
  
  
  
  
  
  
  
  AJ
  
  FY Rein Allow - %Clm Pd Admin
  
  
  
  
  
  
  
  
  
  
  
  
  
  AK
  
  FY Rein Allow - Per Pol Inf
  
  
  
  
  
  
  
  
  
  
  
  
  
  AL
  
  SGL Rein Allow - Comm/Exp
  
  
  
  
  
  
  
  
  
  
  
  
  
  AM
  
  SGL Rein Allow - AppPol Fee
  
  
  
  
  
  
  
  
  
  
  
  
  
  AN
  
  SGL Rein Allow - Per Pol Issd
  
  
  
  
  
  
  
  
  
  
  
  
  
  AO
  
  SGL Rein Allow - Per Rid Issd
  
  
  
  
  
  
  
  
  
  
  
  
  
  AP
  
  SGL Rein Allow - %Prm NB
  
  
  
  
  
  
  
  
  
  
  
  
  
  AQ
  
  SGL Rein Allow - %Prm MKTG
  
  
  
  
  
  
  
  
  
  
  
  
  
  AR
  
  SGL Rein Allow - Prm Prm Tax
  
  
  
  
  
  
  
  
  
  
  
  
  
  AS
  
  SGL Rein Allow - %Prm Maint
  
  
  
  
  
  
  
  
  
  
  
  
  
  AT
  
  SGL Rein Allow - %Clm Pd Adm
  
  
  
  
  
  
  
  
  
  
  
  
  
  AU
  
  SGL Rein Allow - Per Pol Inf
  
  
  
  
  
  
  
  
  
  
  
  
  
  AV
  
  RNL Rein Allow - Comm/Exp
  
  
  
  
  
  
  
  
  
  
  
  
  
  AW
  
  RNL Rein Allow - Per 1 K Inf
  
  
  
  
  
  
  
  
  
  
  
  
  
  AX
  
  RNL Rein Allow - %Prm Prm Tax
  
  
  
  
  
  
  
  
  
  
  
  
  
  AY
  
  RNL Rein Allow - %Prm Ntwk Fee
  
  
  
  
  
  
  
  
  
  
  
  
  
  AZ
  
  RNL Rein Allow - %Prm Maint
  
  
  
  
  
  
  
  
  
  
  
  
  
  BA
  
  RNL Rein Allow - %Prm Care Adv
  
  
  
  
  
  
  
  
  
  
  
  
  
  BB
  
  RNL Rein Allow - %Clm Pd Admin
  
  
  
  
  
  
  
  
  
  
  
  
  
  BC
  
  RNL Rein Allow - Per Pol Inf
  
  
  
  
  
  
  
  
  
  
  
  
  
  BD
  
  RNL Rein Allow - DAC Tax
  
  
  
  
  
  
  
  
  
  
  
  
  
  BE
  
  Disabilitiy Income
  
  
  
  
  
  
  
  
  
  
  
  
  
  BF
  
  Comm/Exp Allow Reins Assmd-FY
  
  
  
  
  
  
  
  
  
  
  
  
  
  BG
  
  Comm/Exp Allow Reins Assmd-Sgl
  
  
  
  
  
  
  
  
  
  
  
  
  
  BH
  
  Comm/Exp Allow Reins Assmd-Ren
  
  
  
  
  
  
  
  
  
  
  
  
  
  BI
  
  Exp Allow - Acquisition
  
  
  
  
  
  
  
  
  
  
  
  
  
  BJ
  
  Exp Allow - Marketing
  
  
  
  
  
  
  
  
  
  
  
  
  
  BK
  
  Exp Allow - Maintenance
  
  
  
  
  
  
  
  
  
  
  
  
  
  BL
  
  Prem Tax Allow Assmd - 1 Yr
  
  
  
  
  
  
  
  
  
  
  
  
  
  BM
  
  Prem Tax Allow Assmd - Rnl
  
  
  
  
  
  
  
  
  
  
  
  
  
  BN
  
  Total Ceding Commission (Sum (X :
  BM))
  
  
  
  
  
  
  
  
  
  
  
  
  
  


(AE &AEII)(GR) GRL
  
  Asset
  
  
  
  (Grp)
  
  (ANN)Life
  
  Enhancer
  
  
  
  Group
  Life
  
  Annuity
  
  50%REALIC
  
  Total
  
  Total
  
  REALIC
  
  Total
  
  Total
  
  REALICLess Inuring Reinsurance AllowanceX
  
  FY Rein Allow - Comm/Exp
  
  
  
  
  
  
  
  
  
  
  
  
  
  Y
  
  FY Ren Allow - App/Pol Fee
  
  
  
  
  
  
  
  
  
  
  
  
  
  Z
  
  FY Rein Allow - Per Pol Isd NB
  
  
  
  
  
  
  
  
  
  
  
  
  
  AA
  
  FY Rein Allow - Per Rid Isd NB
  
  
  
  
  
  
  
  
  
  
  
  
  
  AB
  
  FY Rein Allow - Per Tel Interv
  
  
  
  
  
  
  
  
  
  
  
  
  
  AC
  
  FY Rein Allow - Per 1K issued
  
  
  
  
  
  
  
  
  
  
  
  
  
  AD
  
  FY Rein Allow - %Prm NB
  
  
  
  
  
  
  
  
  
  
  
  
  
  AE
  
  FY Rein Allow - %Prm MKTG
  
  
  
  
  
  
  
  
  
  
  
  
  
  AF
  
  FY Rein Allow - %Prm Prem Tax
  
  
  
  
  
  
  
  
  
  
  
  
  
  AG
  
  FY Rein Allow - %Prm Netwk Fee
  
  
  
  
  
  
  
  
  
  
  
  
  
  AH
  
  FY Rein Allow - %Prm Maint
  
  
  
  
  
  
  
  
  
  
  
  
  
  AI
  
  FY Rein Allow - %Prm Care Advi
  
  
  
  
  
  
  
  
  
  
  
  
  
  AJ
  
  FY Rein Allow - %Clm Pd Admin
  
  
  
  
  
  
  
  
  
  
  
  
  
  AK
  
  FY Rein Allow - Per Pol Inf
  
  
  
  
  
  
  
  
  
  
  
  
  
  AL
  
  SGL Rein Allow - Comm/Exp
  
  
  
  
  
  
  
  
  
  
  
  
  
  AM
  
  SGL Rein Allow - AppPol Fee
  
  
  
  
  
  
  
  
  
  
  
  
  
  AN
  
  SGL Rein Allow - Per Pol Issd
  
  
  
  
  
  
  
  
  
  
  
  
  
  AO
  
  SGL Rein Allow - Per Rid Issd
  
  
  
  
  
  
  
  
  
  
  
  
  
  AP
  
  SGL Rein Allow - %Prm NB
  
  
  
  
  
  
  
  
  
  
  
  
  
  AQ
  
  SGL Rein Allow - %Prm MKTG
  
  
  
  
  
  
  
  
  
  
  
  
  
  AR
  
  SGL Rein Allow - Prm Prm Tax
  
  
  
  
  
  
  
  
  
  
  
  
  
  AS
  
  SGL Rein Allow - %Prm Maint
  
  
  
  
  
  
  
  
  
  
  
  
  
  AT
  
  SGL Rein Allow - %Clm Pd Adm
  
  
  
  
  
  
  
  
  
  
  
  
  
  AU
  
  SGL Rein Allow - Per Pol Inf
  
  
  
  
  
  
  
  
  
  
  
  
  
  AV
  
  RNL Rein Allow - Comm/Exp
  
  
  
  
  
  
  
  
  
  
  
  
  
  AW
  
  RNL Rein Allow - Per 1 K Inf
  
  
  
  
  
  
  
  
  
  
  
  
  
  AX
  
  RNL Rein Allow - %Prm Prm Tax
  
  
  
  
  
  
  
  
  
  
  
  
  
  AY
  
  RNL Rein Allow - %Prm Ntwk Fee
  
  
  
  
  
  
  
  
  
  
  
  
  
  AZ
  
  RNL Rein Allow - %Prm Maint
  
  
  
  
  
  
  
  
  
  
  
  
  
  BA
  
  RNL Rein Allow - %Prm Care Adv
  
  
  
  
  
  
  
  
  
  
  
  
  
  BB
  
  RNL Rein Allow - %Clm Pd Admin
  
  
  
  
  
  
  
  
  
  
  
  
  
  BC
  
  RNL Rein Allow - Per Pol Inf
  
  
  
  
  
  
  
  
  
  
  
  
  
  BD
  
  RNL Rein Allow - DAC Tax
  
  
  
  
  
  
  
  
  
  
  
  
  
  BE
  
  Disabilitiy Income
  
  
  
  
  
  
  
  
  
  
  
  
  
  BF
  
  Comm/Exp Allow Reins Assmd-FY
  
  
  
  
  
  
  
  
  
  
  
  
  
  BG
  
  Comm/Exp Allow Reins Assmd-Sgl
  
  
  
  
  
  
  
  
  
  
  
  
  
  BH
  
  Comm/Exp Allow Reins Assmd-Ren
  
  
  
  
  
  
  
  
  
  
  
  
  
  BI
  
  Exp Allow - Acquisition
  
  
  
  
  
  
  
  
  
  
  
  
  
  BJ
  
  Exp Allow - Marketing
  
  
  
  
  
  
  
  
  
  
  
  
  
  BK
  
  Exp Allow - Maintenance
  
  
  
  
  
  
  
  
  
  
  
  
  
  BL
  
  Prem Tax Allow Assmd - 1 Yr
  
  
  
  
  
  
  
  
  
  
  
  
  
  BM
  
  Prem Tax Allow Assmd - Rnl
  
  
  
  
  
  
  
  
  
  
  
  
  
  BN
  
  Total Ceding Commission (Sum (X :
  BM))
  
  
  
  
  
  
  
  
  
  
  
  


Exhibit A  POLICY FORMS AND PLAN CODES, SUM OF ALL RESERVE ITEMS  A-1


American
Exchange (as of 12/31/2008)  5A  Company
  
  Plan Code
  
  Amount Inforce
  
  Stat Reserve
  
  Deficiency Reserve
  
  Stat + Deficiency Reserve
  
  Count
  
  Type
  
  Wilton Coverage005
  
  005AB1111 XN
  
  1,847,000
  
  6,726
  
  
  
  6,726
  
  36
  
  Traditional005
  
  005BA1111 XN
  
  121
  
  82
  
  
  
  82
  
  2
  
  Traditional005
  
  005BK1511 XN
  
  50,000
  
  592
  
  
  
  592
  
  1
  
  Traditional005
  
  005DAD111 XN
  
  18,000
  
  164
  
  
  
  164
  
  1
  
  Traditional005
  
  005DAE111 XN
  
  20,000
  
  480
  
  
  
  480
  
  1
  
  Traditional005
  
  005DCB111 XN
  
  90,000
  
  251
  
  
  
  251
  
  3
  
  Traditional005
  
  005DCC111 XN
  
  25,000
  
  51
  
  
  
  51
  
  1
  
  Traditional005
  
  005DCD111 XN
  
  25,000
  
  361
  
  
  
  361
  
  1
  
  Traditional005
  
  005DCE111 XN
  
  51,000
  
  1,914
  
  
  
  1,914
  
  2
  
  Traditional005
  
  005DF1111 XN
  
  110,000
  
  677
  
  
  
  677
  
  13
  
  Traditional005
  
  005DF2111 XN
  
  645,000
  
  2,076
  
  
  
  2,076
  
  36
  
  Traditional005
  
  005EJ1111 XN
  
  4,000
  
  3,105
  
  
  
  3,105
  
  4
  
  Traditional005
  
  005ES1111 XN
  
  5,900
  
  1,460
  
  
  
  1,460
  
  3
  
  Traditional005
  
  005GC1111 XN
  
  15,000
  
  6,360
  
  
  
  6,360
  
  3
  
  Traditional005
  
  005HEB1N1 XN
  
  653
  
  605
  
  
  
  605
  
  1
  
  Traditional005
  
  005HEC1N1 XN
  
  13,828
  
  1,698
  
  
  
  1,698
  
  2
  
  Traditional005
  
  005HEJ1N1 XN
  
  2,000
  
  1,095
  
  
  
  1,095
  
  2
  
  Traditional005
  
  005HME 1N1 XN
  
  5,000
  
  798
  
  
  
  798
  
  2
  
  Traditional005
  
  005HWA1N1 XN
  
  69,924
  
  30,606
  
  
  
  30,606
  
  59
  
  Traditional005
  
  005HWA2N1 XN
  
  331,701
  
  98,690
  
  
  
  98,690
  
  112
  
  Traditional005
  
  005HWA4N1 XN
  
  32,308
  
  1,224
  
  
  
  1,224
  
  3
  
  Traditional005
  
  005HWA5L1 XN
  
  786,513
  
  55,744
  
  
  
  55,744
  
  61
  
  Traditional005
  
  005LA2111 XN
  
  650
  
  27
  
  
  
  27
  
  2
  
  Traditional005
  
  005LB1111 XN
  
  526
  
  292
  
  
  
  292
  
  3
  
  Traditional005
  
  005MA2711 XN
  
  325,000
  
  82,336
  
  
  
  82,336
  
  63
  
  Traditional005
  
  005ME1111 XN
  
  14,500
  
  20,863
  
  
  
  20,863
  
  13
  
  Traditional005
  
  005ME1211 XN
  
  9,000
  
  11,713
  
  
  
  11,713
  
  9
  
  Traditional005
  
  005ME2111 XN
  
  35,555
  
  22,989
  
  
  
  22,989
  
  8
  
  Traditional005
  
  005ME3111 XN
  
  22,000
  
  10,018
  
  
  
  10,018
  
  4
  
  Traditional005
  
  005ML7111 XN
  
  9,014
  
  1,922
  
  
  
  1,922
  
  5
  
  Traditional
  
  Wilton005
  
  005PEB1N1 XN
  
  24,000
  
  18,026
  
  
  
  18,026
  
  20
  
  Traditional005
  
  005PEH1N1 XN
  
  2,344
  
  1,411
  
  
  
  1,411
  
  3
  
  Traditional005
  
  005PME1N1 XN
  
  1,265
  
  2,309
  
  
  
  2,309
  
  1
  
  Traditional005
  
  005PME2L1 XN
  
  3,090
  
  2,491
  
  
  
  2,491
  
  1
  
  Traditional005
  
  005PWA1N1 XN
  
  373,189
  
  273,130
  
  
  
  273,130
  
  296
  
  Traditional005
  
  005PWA2N1 XN
  
  241,063
  
  154,513
  
  
  
  154,513
  
  123
  
  Traditional005
  
  005PWA5L1 XN
  
  56,239
  
  17,801
  
  
  
  17,801
  
  16
  
  Traditional005
  
  005PWA711 XN
  
  72
  
  51
  
  
  
  51
  
  1
  
  Traditional
  
  Wilton005
  
  005RCF211 XN
  
  80,000
  
  125
  
  
  
  125
  
  
  
  Traditional005
  
  005RCML71 XN
  
  89
  
  83
  
  
  
  83
  
  
  
  Traditional
  
  Wilton005
  
  005RCW311 XN
  
  73,000
  
  143
  
  
  
  143
  
  
  
  Traditional005
  
  005RCWA71 XN
  
  215,000
  
  140
  
  
  
  140
  
  
  
  Traditional
  
  Wilton005
  
  005RSF111 XN
  
  15,000
  
  113
  
  
  
  113
  
  
  
  Traditional005
  
  005RSF211 XN
  
  45,500
  
  64
  
  
  
  64
  
  
  
  Traditional005
  
  005RSW111 XN
  
  5,000
  
  2,273
  
  
  
  2,273
  
  1
  
  Traditional005
  
  005WA1111 XN
  
  97,790
  
  71,343
  
  
  
  71,343
  
  83
  
  Traditional005
  
  005WA2111 XN
  
  152,500
  
  120,312
  
  
  
  120,312
  
  13
  
  Traditional005
  
  005WA3111 XN
  
  87,724
  
  46,410
  
  
  
  46,410
  
  16
  
  Traditional005
  
  005WA4111 XN
  
  181,000
  
  117,689
  
  
  
  117,689
  
  98
  
  Traditional005
  
  005WA4211 XN
  
  103,538
  
  63,996
  
  
  
  63,996
  
  37
  
  Traditional005
  
  005WA5111 XN
  
  195,000
  
  59,430
  
  
  
  59,430
  
  15
  
  Traditional005
  
  005WA6111 XN
  
  2,636,256
  
  460,029
  
  
  
  460,029
  
  236
  
  Traditional005
  
  005WA7111 XN
  
  641,714
  
  27,672
  
  
  
  27,672
  
  64
  
  Traditional
  
  Wilton005
  
  005WA7211 XN
  
  16,000
  
  1,080
  
  
  
  1,080
  
  3
  
  Traditional
  
  Wilton005
  
  005WE1111 XN
  
  10,000
  
  6,098
  
  
  
  6,098
  
  4
  
  Traditional005
  
  005WE2111 XN
  
  89,000
  
  57,938
  
  
  
  57,938
  
  14
  
  Traditional005
  
  005WE3111 XN
  
  9,176
  
  6,199
  
  
  
  6,199
  
  4
  
  Traditional005
  
  005WF1111 XN
  
  63,100
  
  55,943
  
  
  
  55,943
  
  40
  
  Traditional005
  
  005WF2111 XN
  
  10,000
  
  5,731
  
  
  
  5,731
  
  2
  
  Traditional005
  
  005WF3111 XN
  
  82,000
  
  46,619
  
  
  
  46,619
  
  35
  
  Traditional005
  
  005WF3211 XN
  
  32,599
  
  15,306
  
  
  
  15,306
  
  19
  
  Traditional005
  
  005WG1111 XN
  
  20,500
  
  6,746
  
  
  
  6,746
  
  6
  
  Traditional005
  
  005WS1111 XN
  
  311,333
  
  170,469
  
  
  
  170,469
  
  32
  
  Traditional005
  
  005WS2111 XN
  
  44,360
  
  18,232
  
  
  
  18,232
  
  11
  
  TraditionalTotal
  
  
  
  10,482,634
  
  2,194,834
  
  
  
  2,194,834
  
  1,650Adjustments
  
  
  
  9,911
  
  
  
  
  
  
  
  Total
  
  
  
  10,492,545
  
  2,194,834
  
  
  
  2,194,834
  
  1,6505DCompany
  
  Plan Code
  
  Amount Inforce
  
  Stat Reserve
  
  Deficiency Reserve
  
  Stat + Deficiency Reserve
  
  
  
  Type005
  
  005RAML71 XN
  
  24,800
  
  88
  
  
  
  88
  
  
  
  ADB Rider
  
  Wilton005
  
  005RAW111 XN
  
  9,500
  
  8
  
  
  
  8
  
  
  
  ADB Rider005
  
  005RAW211 XN
  
  72,000
  
  57
  
  
  
  57
  
  
  
  ADB Rider005
  
  005RAWA71 XN
  
  386,000
  
  1,325
  
  
  
  1,325
  
  
  
  ADB Rider
  
  Wilton005
  
  005RAX111 XN
  
  782,000
  
  759
  
  
  
  759
  
  
  
  ADB RiderTotal
  
  
  
  1,274,300
  
  2,237
  
  
  
  2,237Adjustments
  
  
  
  
  
  
  
  
  
  Total
  
  
  
  1,274,300
  
  2,237
  
  
  
  2,2375ECompany
  
  Plan Code
  
  Amount Inforce
  
  Stat Reserve
  
  Deficiency Reserve
  
  Stat + Deficiency Reserve
  
  
  
  Type005
  
  005RWW211 XN
  
  1,475
  
  179
  
  
  
  179
  
  
  
  DISABILITY ACTIVE LIVES005
  
  005RWW311 XN
  
  3,319
  
  503
  
  
  
  503
  
  
  
  DISABILITY ACTIVE LIVES005
  
  005RWW411 XN
  
  117
  
  
  
  
  
  
  
  
  
  DISABILITY ACTIVE LIVESTotal
  
  
  
  4,911
  
  682
  
  
  
  682Adjustments
  
  
  
  
  
  
  
  
  
  Total
  
  
  
  4,911
  
  682
  
  
  
  6825FCompany
  
  Plan
  Code
  
  Amount
  Inforce
  
  Stat
  Reserve
  
  Deficiency
  Reserve
  
  Stat + Deficiency Reserve
  
  
  
  Type005
  
  
  
  
  
  1,2175GCompany
  
  Plan Code
  
  Amount
  Inforce
  
  Stat
  Reserve
  
  Deficiency
  Reserve
  
  Stat + Deficiency Reserve
  
  
  
  Type005
  
  005RGW111 XN
  
  
  
  43ReinsuranceCompany
  
  Name
  
  Ceded Face
  
  Ceded Reserve005
  
  American Pioneer Life Insurance Co.
  
  6,991,720
  
  1,926,934005
  
  Champions Life Insurance Co.
  
  1,443,007
  
  5,267005
  
  Swiss Re Life & Health Ameria Inc
  
  13,160
  
  611005
  
  Optimum Re Insurance Co.
  
  376,000
  
  19,736005
  
  Optimum Re Insurance Co.
  
  
  
  005
  
  Wilton Reassurance Co.
  
  661,417
  
  24,271Total
  
  
  
  9,485,304
  
  1,976,819Adjustments
  
  
  
  
  
  Total
  
  
  
  9,485,304
  
  1,976,819AMEX TOTALSExhibit
  
  
  
  Amount Inforce
  
  Statutory Reserve5A
  
  
  
  10,492,545
  
  2,194,8345B
  
  
  
  
  
  5C
  
  
  
  
  
  5D
  
  
  
  1,274,300
  
  2,2375E
  
  
  
  4,911
  
  6825F
  
  
  
  
  
  1,2175G
  
  
  
  
  
  43Ajustments
  
  
  
  
  
  Total
  
  
  
  10,492,545
  
  2,199,013Actual
  
  
  
  10,492,545
  
  2,199,013Total
  CEDED
  
  
  
  9,485,304
  
  1,976,819Ajustments
  
  
  
  
  
  Total
  
  
  
  9,485,304
  
  1,976,819Actual
  
  
  
  9,485,304
  
  1,976,819Total
  NET
  
  
  
  1,007,241
  
  222,194
  
  
  
  0
  
  (0
  )Actual
  
  
  
  1,007,241
  
  222,194Wilton Coverage
  Adjustment
  
  
  
  220,472
  
  8,090Total After
  Wilton removed
  
  
  
  786,769
  
  214,104


Exhibit B  STATUTORY RESERVES AND LIABILITIES BY POLICY  The Ceding Company sent the
information on Exhibit B to
the Reinsurer via a CD data file on Friday, April 10, 2009. The Reinsurer
received the information on Monday, April 13, 2009.  B-1


Exhibit C  TRANSFERRED ASSETS  The
Transferred Assets shall be within one of the following two (2) categories:  1.
Cash  2.
United States Dollar-Denominated Securities issued or guaranteed by the United
States Treasury.  Valuation of Assets  (a) By 5:00 p.m. on the
fifth (5th) Business Day
prior to the Closing Date, the parties by mutual agreement shall designate
certain Transferred Assets as IDC
Assets, provided that IDC quotes prices for such
Transferred Assets. All Transferred Assets not designated as IDC Assets shall
be designated Brokers Assets. If
the parties cannot agree on the designation of any particular Transferred Asset
as an IDC Asset, such Transferred Asset shall be conclusively deemed to be a
Brokers Asset. The fair market value of each Transferred Asset that is an IDC
Asset and each Transferred Asset that is a Brokers Asset shall be determined as
follows:  (i) No
later than 9:00 a.m. on the Business Day immediately prior to the Closing Date,
Reinsurer shall submit to IDC the CUSIP number (or other unique identifier if
CUSIP is not available) and face amount of each IDC Asset and request that IDC
provide in writing as promptly as practicable to the Ceding Company and the
Reinsurer each such Transferred Assets price (for the given face amount) as of
approximately 3:00 p.m. on such Business Day. The price quoted by IDC shall be
referred to as the IDC Price.  (ii) No
later than 5:00 p.m. on the fourth (4th) Business Day prior to the Closing Date, the
Reinsurer shall submit simultaneously to each of the three (3) Brokers the
CUSIP number (or other unique identifier if CUSIP is not available) and face
amount of each Brokers Asset and request that each Broker provide in writing as
promptly as practicable to the Ceding Company and the Reinsurer each such
Transferred Assets price (for the given face amount), with such price setting
forth the bid value and ask value of each such Transferred Asset as of
approximately 3:00 p.m. on the Business Day immediately prior to the Closing
Date. The price quoted by each Broker for each Brokers Asset shall be the
average of such bid and ask price and shall be designated as the Brokers Quote for each such Brokers
Asset.  (iii) The
Reinsurer and the Ceding Company together shall review the IDC Prices and
Brokers Quotes for any errors and omissions or other disagreements (together, Disagreements). If the Reinsurer or the
Ceding Company reasonably determines that there exists any Disagreement, the
Reinsurer and the Ceding Company shall immediately notify IDC or the applicable
Broker, as the case may be, and use their commercially reasonable efforts to
determine and resolve with the applicable party any such Disagreement prior to
the Closing, or as promptly as practicable after the Closing, in accordance
with the principles set forth in this Exhibit C.  C-1


(b) The fair market
value of each IDC Asset shall be the IDC Price. The fair market value of each
Brokers Asset is the Brokers Quote remaining for such asset after discarding
the highest and lowest Brokers Quote for such asset. Such fair market values
for the IDC and Brokers Assets shall be referred to as the Fair Market Value of such asset.  (c) For purposes of
this Exhibit C:  (i) Brokers means the following brokers:
Citigroup, Merrill Lynch & Co. and JPMorgan Chase & Co.; provided, that, if any such broker does
not provide a Brokers Quote or hereafter becomes an Affiliate of the Reinsurer
or the Ceding Company, the parties shall mutually decide in good faith whether
to proceed without such Brokers Quote or to identify a mutually acceptable
replacement broker.  (ii) IDC means the pricing and quotation
service offered by Financial Time Interactive Data Corp.  C-2