Document:

pri-ex102_133.htm

 

EXHIBIT 10.2

 

AMENDMENT NO. 3

This AMENDMENT NO. 3, dated as of March 31, 2016 (this “Amendment”), amending the 10% Coinsurance Agreement, dated as of March 31, 2010, as amended by Amendment No. 1 thereto, dated as of October 5, 2015, and Amendment No. 2 thereto, dated as of January 25, 2016 (as the same may be amended, supplemented or otherwise modified from time to time, and at any time, the “Agreement”) between Prime Reinsurance Company, Inc., a special purpose financial insurance company organized under Section 6048f of Title 8 of the Vermont Statutes Annotated (the “Reinsurer”) and Primerica Life Insurance Company, a stock life insurance company domiciled in the Commonwealth of Massachusetts (the “Ceding Company”).  

W I T N E S S E T H:

WHEREAS, the Ceding Company and Reinsurer have entered into the Agreement; 

WHEREAS, on October 5, 2015, the Ceding Company and the Reinsurer entered into Amendment No. 1 to the Agreement reflecting the reduction of the Financing Charge to two percent (2.0%) on the Excess Reserves, conditioned upon the approval of the Vermont Department of Financial Regulation and the Massachusetts Division of Insurance, which approvals were subsequently received;

WHEREAS, on January 25, 2016, the Ceding Company and the Reinsurer entered into Amendment No. 2 to the Agreement (“Amendment No. 2”) reflecting the further reduction of the Financing Charge to one-half percent (0.5%) on the Excess Reserves, conditioned upon the approval of the Vermont Department of Financial Regulation and the Massachusetts Division of Insurance and the Closing;

WHEREAS, the Ceding Company ceded 80% of its primary level term inforce life insurance business written prior to December 31, 2009 (the “Subject Business”), to the Reinsurer through the 80% Coinsurance Agreement, dated as of March 31, 2010 (as the same may be amended, supplemented or otherwise modified from time to time, and at any time, the “80% Coinsurance Agreement”); 

WHEREAS, concurrently with the execution of this Agreement, the Reinsurer is divesting the Subject Business, through the novation of the Subject Business (such novation and related transactions, the “Transactions”); and

WHEREAS, the parties intend for this Amendment and Amendment No. 2 to have concurrent effectiveness.

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NOW, THEREFORE, in consideration of the mutual and several promises and undertakings herein contained, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto, intending to be legally bound, hereby agree as follows:

Section 1.Amendments to the Agreement.  Effective as of the date hereof, 

a)Section 1.1(z) of the Agreement is hereby amended by deleting such section in its entirety and inserting in lieu thereof:

“(z) [Reserved]”

b)Section 1.1(eeee) of the Agreement is hereby amended by deleting such section in its entirety and inserting in lieu thereof:

“(eeee)  “Statutory Reserves” means, as of any date, all reserves set forth on Schedule A as of such date corresponding to liabilities of a type or kind identified as Covered Liabilities, related to the Reinsured Policies, such amount as determined by the Ceding Company in accordance with the methodologies used by the Ceding Company to calculate such amounts for purposes of its statutory financial statements prepared in accordance with Massachusetts SAP and generally consistent with past practices as of all dates without giving effect to this Agreement.”

c)Section 8.1 of the Agreement is hereby amended by deleting such section its entirety and inserting in lieu thereof:

Monthly Reports.  Within twenty (20) Business Days after the end of each calendar month, the Ceding Company shall deliver to the Reinsurer the following monthly reports (each a "Monthly Report") substantially in the form set forth in Exhibit III hereto:  (i) Monthly Settlement Report; (ii) Policy Exhibit; (iii) Reserve Report; (iv) Claim Reserve Report; (v) Bordereau Report; (vi) Non-Bordereau Claims Report and (vii) the reports set forth on Schedule C.

d)Section 17.4(b) of the Agreement is hereby amended by deleting such section its entirety and inserting in lieu thereof: 

“The Reinsurer shall not engage in any business, other than the business provided by or relating to this Agreement, the Collateralized Stop Loss Reinsurance Agreement, dated as of March 31, 2016, by and between the Reinsurer and Pecan Re Inc., a special purpose financial insurance company organized under Section 6048f of Title 8 of the Vermont Statutes Annotated (together with its successors and permitted assigns, “Pecan Re”) and the Excess of Loss Reinsurance Agreement, dated as of March 31, 2016, by and between the Reinsurer and Pecan Re.  Other than the reinsurance provided hereunder and in the Collateralized Stop Loss Reinsurance Agreement, dated as of March 31, 2016, by and between the Reinsurer and Pecan Re and the Excess of Loss Reinsurance Agreement, dated as 

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of March 31, 2016, by and between the Reinsurer and Pecan, the Reinsurer shall not issue or reinsure any insurance policies.”

Section 2.Defined Terms; References.  Capitalized terms used herein and not otherwise defined herein shall have the meanings ascribed to such terms in the Agreement.  From and after the Effective Date, references in the Agreement to the “Agreement” or any provision thereof shall be deemed to refer to the Agreement or such provision as amended hereby unless the context otherwise requires.

Section 3.Full Force and Effect.  Except as otherwise expressly provided herein, all of the terms and conditions of the Agreement remain unchanged and continue in full force and effect.  This Amendment is limited precisely as written and shall not be deemed to be an amendment to any other term or condition of the Agreement or any of the documents referred to therein.  

Section 4.Governing Law.  This Amendment shall be governed by and construed in accordance with the laws of the Commonwealth of Massachusetts, without giving effect to the principles of conflicts of law thereof.

Section 5.Assignment.  This Amendment will inure to the benefit of and be binding upon the respective successors and permitted assigns of the parties.  No party may assign any of its duties or obligations hereunder without the prior written consent of the other parties.

Section 6.Captions.  The captions contained in this Amendment are for reference only and are not part of the Amendment.

Section 7.Counterparts.  This Amendment may be executed in one or more counterparts, all of which taken together shall constitute one and the same instrument, and any of the parties may execute this Amendment by signing such counterpart.  This Amendment shall become effective when each party hereto shall have received a counterpart hereof signed by the other party hereto.

Section 8.Third Party Beneficiary.  Nothing in this Amendment is intended to give any Person, other than the parties to this Amendment, their successors and permitted assigns, any legal or equitable right remedy or claim under or in respect of this Amendment.

Section 9.Incontestability.  In consideration of the mutual covenants and agreements contained herein, each party hereto does hereby agree that this Amendment, and each and every provision hereof, is and shall be enforceable by and between them according to its terms, and each party does hereby agree that it shall not contest the validity or enforceability hereof.

[Signature pages follow]

 

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IN WITNESS WHEREOF, the parties have executed this Amendment as of the date first above written.

PRIME REINSURANCE COMPANY, INC.

	
By:
	
/s/ Reza Shah

	
Name:
	
Reza Shah

	
Title:
	
CEO

 

PRIMERICA LIFE INSURANCE COMPANY

	
By:
	
/s/ Dan Settle

	
Name:
	
Dan Settle

	
Title:
	
Executive Vice President

 

 

 

[Signature Page to Amendment No. 3]

 

SCHEDULE C

MONTHLY REPORTS

	
 
	
1.
	
Monthly Settlement Report - Peoplesoft Ledger Balance

	
 
	
2.
	
Claim Reserve Report - Peoplesoft Ledger Balance

	
 
	
3.
	
Monthly Reserve Report - Peoplesoft Ledger Balance

	
 
	
4.
	
Policy and Claim Reserve Recon to GL

	
 
	
5.
	
N’Vision Report

	
 
	
6.
	
Settlement Statements - PrimeRe, FRAC & Experience Refund - Prime Re

	
 
	
7.
	
Monthly Manual Deal Entries

	
 
	
8.
	
GL Interface file

	
 
	
9.
	
Reinsurance Recoverables Aging Report

	
 
	
10.
	
Pending Litigation Claims Reportpri-ex103_131.htm

 

EXHIBIT 10.3

 

AMENDMENT NO. 1 TO THE 80% COINSURANCE TRUST AGREEMENT

This AMENDMENT NO. 1, dated as of March 30, 2016 (the “Amendment”), to the 80% Coinsurance Trust Agreement, dated March 29, 2010 (the “Agreement”), among Prime Reinsurance Company, Inc., a special purpose financial insurance company organized under Section 6048f of Title 8 of the Vermont Statutes Annotated (the “Grantor”), Primerica Life Insurance Company, a Massachusetts-domiciled stock life insurance company (the “Beneficiary”), and The Bank of New York Mellon, a banking corporation with trust powers organized and existing under the laws of the State of New York (the “Trustee”) (the Grantor, the Beneficiary and the Trustee are hereinafter each sometimes referred to individually as a “Party” and collectively as the “Parties”).

WITNESSETH:

WHEREAS, the Grantor, the Beneficiary and the Trustee have entered into the Agreement on the terms and subject to the conditions set forth therein; and

WHEREAS, the Grantor, the Beneficiary and the Trustee now desire to amend the Agreement as hereinafter set forth.

NOW, THEREFORE, for and in consideration of the premises and for other good and valuable consideration, the receipt of which is hereby acknowledged, the Parties hereby agree as follows:

	
1.
	
Definitions.

Capitalized terms used but not otherwise defined in this Amendment shall have the respective meanings set forth in the Agreement.

	
2.
	
Amendments to Trust Agreement.

Section 1(a) of the Agreement is hereby deleted and replaced in its entirety by the following:

	
 
	
“(a)
	
The Grantor has established account number 345845 in the name of “Prime-Funded Reserves Trust Account” and account number 345846 in the name of “Pecan-Funded Reserves Trust Account” with the Trustee (such accounts, together, the “Trust Account”) and the Trustee shall administer the Trust Account in its name as Trustee for the sole use and benefit of the Beneficiary.”  

	
3.
	
Direction.

The Grantor and the Beneficiary hereby authorize and direct the Trustee to deposit the assets in account number 390223 set forth on Annex A to account number 345846 in the name of “Pecan-Funded Reserves Trust Account”.  The Grantor and the Beneficiary hereby authorize and direct 

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the Trustee to deposit all of the other assets in account number 390223 to account number 345845 in the name of “Prime-Funded Reserves Trust Account”.

	
4.
	
Representations and Warranties.

The Grantor, the Beneficiary and the Trustee each hereby represents and warrants with respect to itself as of the date of this Amendment, that:

	
(i)
	
It is duly organized and existing under the laws of the jurisdiction of its organization, with full power to carry on its business as now conducted, to enter into this Amendment and to perform its obligations hereunder; and

	
(ii)
	
This Amendment has been duly authorized, executed and delivered by it, constitutes a valid and legally binding obligation of it, enforceable in accordance with its terms, and no statute, regulation, rule, order, judgment or contract binding on it prohibits its execution or performance of this Amendment.

	
5.
	
Effectiveness.

This Amendment shall be effective on the date first written above.  Notwithstanding the first sentence of this Section 5, if no further amendment is made to the Agreement within 5 Business Days of the date first written above, (i) upon joint written direction executed by the Grantor and the Beneficiary this Amendment shall be null and void, (ii) the Agreement will revert back to its original form prior to giving effect to this Amendment and (iii) all assets on deposit in account number 345845 and 345846 shall be returned and deposited by the Trustee in account number 390223 in the name of Prime Re Co – Primerica 80% on such fifth Business Day and thereafter.  The Trustee acknowledges and agrees that it shall maintain account number 390223 during such five Business Day period, or, if earlier, the date of such further amendment, for such purpose.

	
6.
	
Governing Law.

This Amendment shall be subject to and construed in accordance with the laws of the Commonwealth of Massachusetts, without giving effect to the principles of conflicts of law thereof.  Each party hereto hereby waives trial by jury in any judicial proceeding involving, directly or indirectly, any matter (whether sounding in tort, contract or otherwise) in any way arising out of or related to this agreement or the relationship established hereunder.  This provision is a material inducement for the parties to enter into this Amendment.  Each Party hereby irrevocably waives, to the fullest extent permitted by applicable law, any objection which it may now or hereafter have to the laying of venue of any such proceeding brought in such a court and any claim that such proceeding brought in such a court has been brought in an inconvenient forum.  The establishment and maintenance of the Trust Account, and all interests, duties and obligations with respect thereto, shall be governed by the laws of the Commonwealth of Massachusetts.

	
7.
	
Successors and Assigns.

The provisions of this Amendment shall be binding upon and inure to the benefit of the Parties and their respective successors and assigns.

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8.Ratification. 

Except as expressly modified hereby, all of the terms of the Agreement shall remain in full force and effect.

9.Severability.

In the event that any provision of this Amendment shall be declared invalid or unenforceable by any regulatory body or court having jurisdiction, such invalidity or unenforceability shall not affect the validity or enforceability of the remaining portions of this Amendment.

	
10.
	
Headings.

The headings of the Sections have been inserted for convenience of reference only and shall not be deemed to constitute a part of this Amendment.

	
11.
	
Counterparts. 

This Amendment may be executed in any number of counterparts, each of which when so executed and delivered shall constitute an original, but all of such counterparts together shall constitute but one and the same Amendment.  The parties may sign and deliver this Amendment by electronic transmission, including PDF.  All the parties agree that the delivery of the Amendment by electronic transmission shall have the same force and effect as delivery of original signatures and that each party may use such electronic signatures as evidence of the execution and delivery of this Amendment by both parties to the same extent that an original signature could be used.

[Signature pages follow]

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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be executed and delivered by their respective officers thereunto duly authorized as of the date first above written.

PRIME REINSURANCE COMPANY, INC.,

as Grantor

	
By:
	
/s/ Reza Shah

	
Name:
	
Reza Shah 

	
Title:
	
CEO 

 

 

PRIMERICA LIFE INSURANCE COMPANY,

as Beneficiary

	
By:
	
/s/ Dan Settle

	
Name:
	
Dan Settle

	
Title:
	
Executive Vice President 

 

 

THE BANK OF NEW YORK MELLON,

as Trustee

	
By:
	
/s/ Ignazio Tamburello

	
Name:
	
Ignazio Tamburello

	
Title:
	
Vice President

 

 

 

[Signature Page to Amendment No. 1 to the 80% Coinsurance Trust Agreement]

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