Exhibit 10.7

 

AMENDMENT   NUMBER   ONE

 

 

AUTOMATIC REINSURANCE AGREEMENT

 

 

NUMBER              2509-09AY10

 

 

between

 

 

AMERICAN LIFE AND SECURITY CORPORATION

 

8101 O Street, Suite 101

 

Lincoln, Nebraska 68510

 

 

(The Ceding Company)

 

 

and

 

 

OPTIMUM RE INSURANCE COMPANY

 

1345 River Bend Drive, Suite 100

 

Dallas, TX 75247

 

 

(The Reinsurer)

 

 

Respecting a change to Self-Administered Reporting and correction in the Death Benefit Schedule.

 











 

1.       Effective from inception, August 1, 2009, this Agreement shall be amended to reflect a change to Self-Administered Reporting and a correction in the Death Benefit Schedule as follows:

 

A.      Article 2.1., Automatic Reinsurance, shall be amended and replaced by the following:

 

When the initial premium on a policy eligible for automatic reinsurance has been received by THE COMPANY, THE COMPANY shall include such policy and details of reinsurance on the Self-Administered Individual Cession Listing (Article 8) for the current billing period.

 

B.       Article 8, Accounting and Billing, shall be amended and replaced in its entirety by the following:

 

8.1.             Reinsurance Premiums

 

The reinsurance premiums are due on the policy issue date and every subsequent anniversary date of the policy and payable to OPTIMUM RE on an annual basis regardless of how premiums are paid to THE COMPANY.

 

8.2.             Self-Administered Billing/Individual Cession Reporting

 

Recognizing that reinsurance premiums are due within 30 days of the anniversary date of the policy, THE COMPANY will send to OPTIMUM RE, within 30 days of the end of each month, a listing of new business, renewals, changes and terminations and a statement of amounts due. These statements shall contain, at least (minimal), the information detailed in SCHEDULE G.

 

THE COMPANY will pay the net balance due to OPTIMUM RE with the statement. If a balance is due to THE COMPANY, OPTIMUM RE will pay such amount within 30 days of receiving the statement.

 

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8.3.             Late Payment

 

Any overdue balance bears interest from the end of a 45-day period following the end of the month in which the premiums became due.

 

The interest rate for the period from 45 to 75 days will be the then current annual prime interest rate of the JP Morgan Chase Bank, Dallas, Texas calculated on a monthly basis.

 

For each additional month, after 75 days that a balance remains unpaid, interest will be calculated using the above annual rate plus 2%.

 

The payment of reinsurance premiums shall be a condition precedent to the liability of OPTIMUM RE under this Agreement. If any premium remains unpaid for more than 60 days after the due date, OPTIMUM RE may send to THE COMPANY a formal demand for immediate payment. If THE COMPANY does not comply with this demand within 30 days, then OPTIMUM RE may cancel any unpaid reinsurance cessions for nonpayment of premium;  however, any unpaid premiums to the time of cancellation would be due with interest.

 

THE COMPANY will not force cancellation under the provisions of this Article solely to circumvent the provisions regarding recapture in Article 9.12., or to transfer the reinsured policies to another reinsurer.

 

C.      Schedule B, Plans Reinsured, shall be replaced by the attached to reflect a correction in the Death Benefit Schedule.

 

D.     This Agreement shall be amended to include the following Schedule as attached:

 

Schedule G                     Self-Administered Individual Cession List

 

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SCHEDULE B

 

2.        Signatures:       The terms and conditions of this Agreement are not changed in any way except as stated herein.

 

In witness of the above, this Amendment is signed in duplicate at the dates and places indicated.

 

FOR          AMERICAN LIFE AND SECURITY CORPORATION

 

	
DATE:
    	
12/1/10
    	
 
    	
SIGNATURE:
    	
/S/ Mark Oliver
    
	
 
    	
 
    	
 
    
	
PLACE:
    	
Lincoln, NE
    	
 
    	
NAME:
    	
Mark A. Oliver
    
	
 
    	
 
    	
 
    
	
WITNESS:
    	
  /S/   Sharisa Haier
    	
 
    	
TITLE:
    	
  CEO
    
									


 

FOR          OPTIMUM RE INSURANCE COMPANY

 

	
DATE:
    	
12/1/10
    	
 
    	
SIGNATURE:
    	
/S/ Mario Georgiev
    
	
 
    	
 
    	
 
    
	
PLACE:
    	
Dallas, TX
    	
 
    	
NAME:
    	
Mario Georgiev
    
	
 
    	
 
    	
 
    
	
WITNESS:
    	
  /S/   Unknown
    	
 
    	
TITLE:
    	
President
    
									


 

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SCHEDULE B

 

PLANS REINSURED

 

·MODIFIED WHOLE LIFE PLAN 
 (FORM #ALSC-001 (05-09))

 

DEATH BENEFIT PATTERN

 

	
 
    	
·  ISSUE AGES 0-20:
    
	
 
    	
DEATH   BENEFIT WILL INCREASE BY $1,000 PER YER PER UNIT FOR 10 YEARS AND WILL THEN   REMAIN LEVEL
    
	
 
    	
·  ISSUE AGES 21-50:
    
	
 
    	
DEATH   BENEFIT WILL DECREASE BY $3,000 PER YEAR PER UNIT FOR 20 YEARS AND WILL THEN   REMAIN LEVEL
    
	
 
    	
·  ISSUE AGES 51-65:
    
	
 
    	
DEATH   BENEFIT WILL DECREASE BY $3,000 PER YEAR PER UNIT FOR 10 YEARS AND WILL THEN   REMAIN LEVEL
    
	
 
    	
·  I SSUE AGES 66-80:
    
	
 
    	
DEATH   BENEFIT WILL DECREASE BY $5,000 PER YEAR PER UNIT FOR 4 YEARS AND WILL THEN   REMAIN LEVEL
    


 

·      For issue ages 0-20, the policy increases combined with the base coverage cannot exceed the reinsurance limits and capacities per Life as specified in SCHEDULE A.

 

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SCHEDULE G

 

SELF-ADMINISTERED INDIVIDUAL CESSION LIST

 

The self-administered accounting data shall be submitted to OPTIMUM RE on a monthly basis and shall consist of statements containing details for each policy reinsured as follows:

 

A.       NEW BUSINESS STATEMENT

 

1. Policy Number

2. Name of insured

3. Issue Age

4. Sex

5. Date of Birth

6. State of Residence

7.  Plan

8. Policy Issue Date

9. Face Amount

10. Reinsurance Amount

11. Current Net Amount at Risk

12. Substandard Rating

13. Smoker/Nonsmoker Code

14. Priors

 

B.         PREMIUM STATEMENT

 

1. Policy Number

2. Name of Insured

3. Policy Issue Date

4. Duration

5. Reinsurance Amount

6. Current Net Amount at Risk

7. Substandard Rating

8. Reinsurance Premium- Standard & Substandard

9. Allowances

 

C.         TERMINATION/ADJUSTMENT STATEMENT

 

1. Policy Number

2. Name of Insured

3. Effective Date of Termination (Stop Date)/Adjustment

4. Plan

5. Reinsurance Amount

6. Current Net Amount at Risk

7. Reinsurance Premium- Standard & Substandard

8. Allowances

9. Reason for Termination/Adjustment

 

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