Document:

INSURANCE MANAGEMENT AND
                           ADVISORY SERVICES AGREEMENT
                                     BETWEEN
                      AON INSURANCE MANAGERS (BARBADOS) LTD
                                       AND
                         INTEGON RE (BARBADOS), LIMITED

<PAGE>

THIS INSURANCE  MANAGEMENT AND ADVISORY SERVICES  AGREEMENT made the 13th day of
March, 2000.

BETWEEN        AON INSURANCE  MANAGERS  (BARBADOS) LTD. a body corporate  having
               its Principal Office at One Financial Place,  Collymore Rock, St.
               Michael,  in the Island of Barbados  (hereinafter  referred to as
               "the Manager").

                                OF THE FIRST PART

AND            INTEGON  RE  (BARBADOS),  LIMITED  a body  corporate  having  its
               Principal Office at The Financial Services Centre, Bishop's Court
               Hill,  St.  Michael,  in  the  Island  of  Barbados  (hereinafter
               referred to as "the Company")

                               OF THE SECOND PART

WHEREAS,  the Company is based in Barbados and from such country  engages in the
business   of   reinsurance   and   desires   certain   management,   financial,
administrative  and advisory services to assist it in the accomplishment of such
business; and

WHEREAS,  at  its  offices  in  Barbados,  the  Manager  maintains  a  staff  of
professional  insurance and financial executives and administrative and clerical
personnel experienced in providing such services and

WHEREAS,  the Company and the Manager are desirous of entering into an agreement
whereby the Manager will render insurance management, financial,  administrative
and advisory services as required by the Company.

1.   THE  MANAGER  agrees  and  covenants  with the  COMPANY  to  undertake  and
     discharge  the  following   obligations,   subject  at  all  times  to  the
     directions,  limitations,  approval or general  supervision of the Company,
     the Board of Directors or such other  officials of the Company as the Board
     of Directors may designate:-

     (a)  Authority to Underwrite

          On the authorisation of the Company to underwrite and accept on behalf
          of the Company or decline such reinsurance  business as may be offered
          to the Company from time to time.

                                                                    Page 2 of 12

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     (b)  Authority to Execute Underwriting Documents

          On the  authorisation  of the Company to sign and issue in the name of
          the Company  policies and contracts of reinsurance  together with such
          binders  and other  documents  as may be  required  in relation to the
          conduct of the reinsurance business of the Company.

     (c)  Authority to Act on Claims Matters

          On behalf of the  Company  to  receive  claims  for  losses  including
          recoveries, and on the authorisation of the Company to arrange to have
          provided  to  the  Company   loss   adjustment   services,   including
          arrangements  for  on-site   adjustments,   by  loss  adjusters,   and
          thereafter, pay all such claims including survey investigation, legal,
          and other usual fees and expenses  provided that such payment shall be
          made only out of funds provided by the Company for the purpose.

     (d)  Authority to Retrocede

          On behalf  and with the  authorisation  of the  Company  to effect the
          reinsurance or retrocession of risks accepted on behalf of the Company
          by the Manager.

     (e)  Maintenance of Books & Records

          To assist in maintaining  on behalf of the Company,  separate from the
          Manager's  own books and  records,  such books of account  showing the
          financial  condition  of the  Company  in  accordance  with the Exempt
          Insurance  (Amendment)  Act 1995 and the  Companies  Act 1982-54,  and
          every  statutory  amendment of the said Acts,  and in accordance  with
          established  accounting  principles  applicable  to  the  business  of
          insurance and  reinsurance  and to submit each year an annual  balance
          sheet and  statement of profit and loss to The Board of Directors  and
          the  auditor  of the  Company.  The  Company,  or its duly  authorised
          representative(s)  may at any  reasonable  time  inspect  the  records
          maintained on its behalf by the Manager.

     (f)  Financial and Statutory Reporting

          To prepare  and make  available,  upon the  request  of the  Company's
          directors,  interim  financial  statements  and other  reports  as may
          reasonably be required by the Company including the preparation of all
          statutory  and  other  reports  as may  be  required  by the  Barbados
          insurance and/or other regulatory authorities,  including filings with
          the  Securities  and  Exchange  Commission  of the  United  States  of
          America.

     (g)  Authority to Collect and Invest Funds

          To collect,  on behalf of the  Company,  reinsurance  premiums and all
          other  amounts  due the Company  and manage and invest  Company  funds
          under the Manager's

                                                                    Page 3 of 12

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          control,  pending  transfer  of  available  funds  to  the  Investment
          Manager,  as the Board shall from time to time appoint.

     (h)  Maintenance of Staffed Office

          To  maintain a properly  staffed  office in Barbados to enable the due
          performance of all duties required under this Agreement.

     (i)  General Authority

          Generally  to do  all  things  necessary  for  the  management  of any
          insurance  or  reinsurance  business  which  the  company  is  or  may
          hereafter be authorised to undertake.

     (j)  Maintenance of Accounts and Authority to Disburse Funds

          To maintain on behalf of the  Company  such bank  accounts as shall be
          necessary  and to make  disbursements  as  required to pay charges and
          expenses properly incurred in the operation of the Company.

     (k)  Other Professional Service Disclaimer

          It is agreed that the Manager  will not provide  legal or tax counsel,
          investment  advice,   secretarial  services  or  independent  auditing
          services under this Agreement.

     (l)  Restriction on Services

          Except as specifically  authorised by the Company,  during the term of
          this Agreement and for a period of one year after it is terminated the
          Manager  agrees not to provide  management or accounting  services for
          any other company which, by the nature of its operations, is offering,
          insuring or reinsuring  automobile insurance policies on a multi-state
          basis in the United  States of  America.  The terms of this  paragraph
          shall  apply also to any  present or future  affiliate  of the Manager
          operating in Barbados. The Manager represents that it is authorised to
          commit to the terms of this paragraph on behalf of such affiliates.

     (m)  Confidential Treatment of Information

          The  Manager  will treat as  confidential  all  information,  from any
          source,  concerning the business of the Company (including information
          in all books and records  referred to in paragraph  3(h), will not use
          any of it except for the purpose of  performing  this  Agreement,  and
          will  not  divulge  any  of it to  any  persons  except  (i) as may be
          required in regulatory  filings of which the Company has prior notice,
          and  (ii)  to  Manager's  employees  who  have  a  need  to  know  the
          information  in order to perform  this  Agreement  and who agree to be
          bound by the terms of this paragraph.  In the event the Manager or any
          of its  present  or former  employees  becomes  legally  compelled  to

                                                                    Page 4 of 12

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          disclose any of the information,  the Manager (or such individuals, as
          the case may be) will provide the Company with prompt notice, and will
          disclose  only such  portions  of the  information  which are  legally
          required  to  be  disclosed.   All  documents   containing   any  such
          information  will be provided to the Company upon request,  subject to
          the rights of the Manager under  paragraph  3(h) with respect to books
          and records  maintained by the Manager.  The Company shall be entitled
          to  specific  enforcement  in the event of any  breach  or  threatened
          breach of this paragraph,  as well as to any other remedy at law or in
          equity.  For  purposes of this  paragraph,  the term  "Manager"  shall
          include  any present or future  affiliate,  wherever  located,  of Aon
          Insurance  Managers  (Barbados)   Ltd.,which  represents  that  it  is
          authorised to commit to the terms of this  paragraph on behalf of such
          affiliates.  Company data shall not be  disclosed to any  affiliate of
          the Manager operating in Bermuda except on conditions  satisfactory to
          the Company.  The Manager's  obligations  under this  paragraph  shall
          survive termination of this Agreement.

2.   The  COMPANY  agrees  and  covenants  with the  MANAGER  to  undertake  and
     discharge the following obligations:-

     (a)  General Authority

          To  provide  sufficient  information  and  instructions  to enable the
          Manager to perform  all its  duties set out in this  Agreement  and to
          promptly  comply with any  requests  by the  Manager for  information,
          instructions, or requests for approval.

     (b)  Ratification of Actions

          To review, and where appropriate, approve or ratify the performance of
          reasonable  actions  taken on behalf of the Company,  and the forms of
          any documents and contracts arising  therefrom,  pursuant to the terms
          of this Agreement.

     (c)  Investment Disclaimer

          To  be  responsible  and  have  sole   responsibility  for  investment
          decisions,  notwithstanding  any  advice  which  may be  given  by the
          Manager.

     (d)  Manager's Fees

          To pay the  Manager a fee,  the  amount  and  basis of which  shall be
          mutually  agreed  by the  Company  and the  Manager  and  which may be
          revised from time to time by endorsement to this Agreement.

     (e)  Indemnification

          To indemnify and defend and keep  indemnified  the Manager against all
          costs, expenses, claims, demands and liabilities for which the Manager
          and its  directors,  officers,  employees and agents may become liable
          and against all actions, suits,

                                                                    Page 5 of 12

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          proceedings,  claims or demands of any nature  whatsoever which may be
          taken or made  against  the  Manager or which may be incurred or which
          may  arise  directly  or  indirectly  by reason  of the  provision  of
          services under this Agreement or by reason of anything done or omitted
          to be done in  relation  thereto  except as same may relate to acts of
          fraud,  negligence,  contractual  breach by  default  and/or  criminal
          activity by the Manager.

3.   It is mutually  agreed and  covenanted  between the MANAGER and the COMPANY
     that:-

     (a)  Effective Date

          This Agreement shall be effective from March 13th, 2000.

     (b)  Term

          This  Agreement  shall be continuous  until  terminated by ninety days
          prior written notice from one party to the other.

     (c)  Continuance of Underwriting Contracts on Termination

          Termination  of this  Agreement  shall not be  deemed  to  effect  the
          termination,  prior  to  expiration  of  their  contract  terms of any
          policies and binders of insurance and  reinsurance  effected  prior to
          the date of termination of this Agreement.

     (d)  Contractual Liability on Termination

          Termination  of this  Agreement  shall  not  relieve  either  party of
          liability for performance of any  obligations  imposed upon said party
          with  respect to business  entered  into  pursuant to this  Agreement,
          which have not been  performed  at the time of  termination,  provided
          that the Manager shall be reimbursed in full for services rendered and
          expenses  incurred  subsequent  to the effective  date of  termination
          under such terms and  conditions as may be agreed upon by both parties
          to ensure the proper and timely  completion of their obligations under
          this contract.

     (e)  Automatic Termination Clause

          Anything to the contrary in this Agreement  notwithstanding,  it shall
          be   automatically    terminated   without   notice   by   insolvency,
          receivership, bankruptcy or liquidation of either party.

     (f)  Limitations on Manager's Authority

          The Manager  shall have no power to enter into any  contract on behalf
          of Company unless specifically authorised by Company to do so.

                                                                    Page 6 of 12

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     (g)  Professional Conduct of Manager

          All services  performed by the Manager under this  Agreement  shall be
          performed  in a manner  consistent  with that  level of care and skill
          ordinarily  exercised by professionals  providing such services in the
          insurance industry. However, the Manager and its directors,  officers,
          employees and agents  (including any person provided by the Manager to
          the Company to serve as an officer  and/or  Director  of the  Company)
          shall not be liable to the Company for any acts  and/or  omissions  in
          the conduct of their duties  hereunder,  except as same may constitute
          fraud,  negligence,  contractual  breach by  default  and/or  criminal
          activity.

     (h)  Ownership of Books and Records

          All books and records of the Company  shall remain the property of the
          Company  and  shall  be  delivered  promptly  to the  Company,  or its
          designee following any termination of this Agreement;  provided always
          that the Manager shall have the right to maintain copies of such books
          and  records  maintained  by it and  shall  have the right at any time
          within six years after any  termination  of this  Agreement to inspect
          such  books  and  records  and to  make  copies  thereof  or  extracts
          therefrom.

     (i)  Development System Software

          The Company and the Manager agree that in the event of  termination of
          this  Agreement  the Company  shall have the right to continued use of
          the development system software.  The Company shall be responsible for
          the provision of operating  system software and  appropriate  hardware
          for the purposes of operating the  development  systems  software.  In
          consideration for the provision of the development system software and
          such  related  user  manuals  as  may be  available  at  the  time  of
          acquisition  the Company  shall pay to the Manager an amount  equal to
          10% of fees paid to the  Manager  during  the 24  months  prior to the
          termination  date under this contract  provided that such amount shall
          not be less than  US$40,000.  Ownership of, title to and all rights in
          and to the Programs and the Documentation  including copyright and any
          other  proprietary  right,  shall at times  remain  with the  manager,
          except that,  enhancements made and used solely for the Company, shall
          become  proprietary  to the  Company,  and  shall  not be  used by the
          Manager  relative to any other client without the prior consent of the
          Company. Except for proprietary  enhancements,  the Company agrees not
          to market,  distribute  or  otherwise  allow  access to the  operating
          software, other than its support staff or technology support vendor.

     (j)  Assignment of Agreement

          This Agreement  shall inure to the benefit of, and be binding upon the
          parties hereto and shall not be assignable by either party without the
          prior written consent of the other.

                                                                    Page 7 of 12

<PAGE>

     (k)  Governing Law

          This  Agreement  shall be  governed  and  construed  under the laws of
          Barbados and the parties  hereby agree to submit to the  non-exclusive
          jurisdiction of the Courts of Barbados.

     (l)  Execution of Agreement

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

     (m)  Professional Indemnity Insurance

          The  Manager  shall at all  times  during  the term of this  Agreement
          maintain:

          (i)  An errors and  omissions  insurance  policy  issued by an insurer
               reasonably  acceptable  to  Company  in an  amount  not less than
               U.S.$5,000,000; and

          (ii) A fidelity  bond,  issued by a company  reasonably  acceptable to
               Company,  providing coverage for all officers and other employees
               of  the  Manager  and  its  affiliates   (including   "money  and
               securities" coverage) in an amount not less than U.S.$1,000,000.

     (n)  Manager's Indemnification

          The Manager  agrees to hold  harmless  and  indemnify  the Company for
          losses arising out of fraud,  negligence  reckless conduct or criminal
          activity of its  employees  and  affiliates'  employees in  performing
          services on behalf of Company under this Agreement.

     (o)  Arbitration

          (i)  It is the  intention  of the  Company  and the  Manager  that the
               customs and  practices of the insurance  industry  shall be given
               full  effect  in  the  operation  and   interpretation   of  this
               Agreement.  The  parties  agree  to act in all  things  with  the
               highest  good  faith.  If the  Company  and  the  Manager  cannot
               mutually  resolve  any  dispute  that arises out of or relates to
               this  Agreement,  whether  such  dispute  arises  before or after
               termination  of this  Agreement,  the  disputes  shall be decided
               through arbitration.

          (ii) This Agreement and the performance of the parties hereunder shall
               be  interpreted,  construed and enforced in  accordance  with the
               laws of Barbados.  The arbitrators  shall consider this Agreement
               as  an  honourable   engagement  rather  than  as  a  mere  legal
               obligation   and  they  shall  reach  their   decision  from  the
               standpoint  of  equity  and  the  customs  and  practices  of the
               insurance

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               industry  rather  than  solely  from the  standpoint  of a strict
               interpretation of the applicable substantive and procedural law.

          (iii)In  initiating  arbitration,  either the  Company or the  Manager
               shall  notify the other in  writing  of its desire to  arbitrate,
               stating  the nature of its  dispute  and the remedy  sought.  The
               party  to  which  the  notice  is  sent  shall   respond  to  the
               notification  in  writing  within  ten (10)  working  days of its
               receipt. At that time, the party also shall assert any dispute it
               may have that arises out of or relates to this Agreement.

          (iv) The  arbitration  hearing  shall be  befor a panel  of three  (3)
               arbitrators, each of who must be a present or former officer of a
               property,  casualty insurance company,  other than the Company or
               the Manager or either's  affiliates.  The Company and the Manager
               shall each appoint one arbitrator by written  notification to the
               other within  twenty-five (25) days of the date of the mailing of
               the  notification  initiating  the  arbitration.  These  two  (2)
               arbitrators   shall  then  select  the  third  arbitrator  within
               fourteen  (14) days  after  their  selection.  Should  either the
               Company or the Manager fail to appoint an  arbitrator,  or should
               the two (2)  arbitrators  be unable to agree upon the choice of a
               third  arbitrator,  such  appointment  shall  be left to the then
               current President of the Barbados Bar Association. Once selected,
               the  arbitrators  are to decide all  substantive  and  procedural
               issues involved by a majority of votes.

          (v)  The  arbitration  hearing  shall be held on the date fixed by the
               arbitrators  in the city of  Bridgetown,  Barbados,  unless  some
               other location is mutually agreed on by the parties.  In no event
               shall  this  date be  later  than  three  (3)  months  after  the
               appointment  of  the  third  arbitrator.  The  arbitrators  shall
               establish  pre-arbitration  procedures  as warranted by the facts
               and issues of the particular case.  Within twenty (20) days after
               the end of the arbitration hearing, the arbitrators shall issue a
               written award,  from which there shall be no appeal and which any
               court having  jurisdiction  of the subject matter and the parties
               may reduce to judgement.

          (vi) In their award,  the  arbitrators  shall  apportion  the costs of
               arbitration  including,  but not limited  to,  their own fees and
               expenses, as they deem appropriate.

                                                                    Page 9 of 12

<PAGE>

     IN WITNESS  WHEREOF,  the parties have caused this Agreement to be executed
by their officers or agents  thereunto  truly  authorised as of the day and year
first here and before written.

Signed On Behalf of:

AON INSURANCE MANAGERS (BARBADOS) LTD.

By:     /s/ Ronald W. Jones           By:     /s/ Philip Stamp
        ------------------                    ------------------
        Ronald W. Jones                       Philip Stamp

Title:  Managing Director             Title:  Chief Executive Officer,
        ------------------                    Captive Management Services
                                              ---------------------------

Date:   March 24, 2000                Date:   March 27, 2000
        ------------------                    ------------------

Signed on Behalf of:

INTEGON RE (BARBADOS), LIMITED

By:     /s/ Peter R. P. Evelyn
        ----------------------
        Peter R. P. Evelyn

Title:  Director
        ----------------

Date:   March 24, 2000
        ----------------

                                                                   Page 10 of 12

<PAGE>

               INSURANCE MANAGEMENT & ADVISORY SERVICES AGREEMENT

                                     BETWEEN

                     AON INSURANCE MANAGERS (BARBADOS) LTD.

                                       AND

                         INTEGON RE (BARBADOS), LIMITED

                                ENDORSEMENT NO: 1

                             Reference Section 2 (d)

ROUTINE OPERATIONS

Effective  April 1, 2000 the fee payable to the Manager  for  services  provided
under the contract in relation to day to day operations  considered to be in the
normal course of business will comprise a fixed and variable  component  payable
monthly in arrears excluding reimbursable out-of-pocket expenses.

Fixed Fee           US$70,000 per annum or US$5,833.33 per month.

Variable Fee        US$530 per  annum/(US$44.17  per month) for each  issued and
                    outstanding series of Participating Stock.

The fees  outlined  above  will  cover  all  normal  day to day  activities  and
reporting requirements of the Company as follows:

(1)  Quarterly financial & SEC reporting  including  production and distribution
     of Shareholder Statements.

(2)  Annual financial and SEC reporting including production and distribution of
     Shareholder  Statements,  preparation  and  distribution  of IRS Form  5471
     income tax returns and  preparation of audit file  providing  assistance to
     auditors in the performance of their duties.

(3)  Co-ordination   and  preparation  of  material  relevant  to  th  efficient
     operation  and  execution  of the  Company's  AGM and  Board  of  Directors
     meetings held in conjunction therewith, and attendance at such meetings.

(4)  Execution  of such  documents as may be required to be filed by the Company
     in relation to SEC and State filing compliance.

(5)  Preparation and distribution of annual dividend cheques.

(6)  Generally  reporting  to  all  enquiries  for  information  and/or  reports
     relevant to the above.

                                                                   Page 11 of 12

<PAGE>

SPECIAL PROJECTS

With  respect  to special  projects,  defined as  projects  which are  typically
non-recurring  and  not in the  normal  course  of day to day  operations  (e.g.
defining, programming and testing of changes to shareholder statements; Board or
Shareholder  meetings not forming part of the annual  meetings;  work related to
review and/or changes in outside service  providers;  work related to changes in
MIC cession information, etc.) then the Company and the Manager will act in good
faith to determine an  appropriate  budget  and/or fee relative to such projects
which  shall be approved by the  Company  prior to  commencement  of work by the
Manager.

For the purposes of calculating  fees relative to special projects the following
hourly charge out rates will apply.

            Managing Director / Vice-President                  US$150
            Account Executives                                  US$125
            Senior Administrative Staff                         US$ 80
            Secretarial / Support Staff                         US$ 45

Reimbursable  out-of-pocket  expenses  will include all costs such as telephone,
facsimile,  postage,  printing,  stationery,  travel and any other such expenses
incurred  by the  Manager  on behalf of the  Company  as may be agreed  with the
company from time to time.

Signed On Behalf of:

AON INSURANCE MANAGERS (BARBADOS) LTD.

By:     /s/ Ronald W. Jones           By:     /s/ Philip Stamp
        ------------------                    ------------------
        Ronald W. Jones                       Philip Stamp

Title:  Managing Director             Title:  Chief Executive Officer,
        ------------------                    Captive Management Services
                                              ---------------------------

Date:   March 24, 2000                Date:   March 27, 2000
        ------------------                    ------------------

Signed on Behalf of:

INTEGON RE (BARBADOS), LIMITED

By:     /s/ Peter R. P. Evelyn
        ----------------------
        Peter R. P. Evelyn

Title:  Director
        ----------------

Date:   March 24, 2000
        ----------------

                                                                   Page 12 of 12INVESTMENT MANAGER AGREEMENT

                                 by and between

                         Integon Re (Barbados), Limited

                                       and

                          BlackRock International, Ltd.

<PAGE>

INVESTMENT MANAGER AGREEMENT

     THIS  AGREEMENT,  made as of the 8th day of February,  2000, by and between
Integon Re (Barbados),  Limited (hereinafter called the "Company") and BlackRock
International, Ltd. (hereinafter called the "Manager").

                                   WITNESSETH:

     WHEREAS,  the Company has all  requisite  authority  to appoint one or more
investment managers to supervise and direct the investment and reinvestment of a
portion of all of the assets of the Company;

     THEREFORE,  for and in  consideration  of the  premises  and of the  mutual
covenants herein contained, the parties hereby agree as follows:

1.  Appointment  and Status as Investment  Manager;  Delegation  of Duties.  The
Company hereby appoints the Manager as an "Investment Manager." The Manager does
hereby accept said  appointment by its execution of this Agreement.  The Manager
does also  acknowledge  that it is a fiduciary  with respect to the assets under
management  and  assumes  the  duties,  responsibilities  and  obligations  of a
fiduciary. The Company acknowledges that some or all of the Manager's rights and
obligations  under this  Agreement,  including  its  appointment  as  investment
manager to the Company,  may be delegated by the Manager to BlackRock  Financial
Management, Inc.

2.  Representations by Company.  The Company represents and warrants that (a) it
has all requisite  authority to appoint the Manager hereunder,  (b) the terms of
the Agreement do not conflict with any obligation by which the Company is bound,
whether  arising  by  contract,  operation  of law or  otherwise  and  (c)  this
Agreement has been duly authorized by appropriate corporate action.

3. Management Services.  The Manager shall be responsible for the investment and
reinvestment  of those  assets  designated  by the  Company  as  subject  to the
Manager's management (which assets,  together with all additions,  substitutions
and alterations  thereto are hereinafter called the "Account").  The Account may
include all securities and instruments  described in Exhibit A or appropriate to
effect the strategies described therein. The Company does hereby delegate to the
Manager  all of its  powers,  duties and  responsibilities  with  regard to such
investment and reinvestment and hereby appoints the Manager as its agent in fact
with full  authority to buy, sell or otherwise  effect  investment  transactions
involving  the assets in its name and for the Account.  Said powers,  duties and
responsibilities  shall be exercised  exclusively by the Manager pursuant to and
in accordance  with its fiduciary  responsibilities  and the  provisions of this
Agreement.  In deciding on a proper investment of the Account, the Manager shall
consider the following  factors as communicated in writing to the Manager by the
Company from time to time: a) the Company's  financial  needs such as liquidity,
b) applicable  laws,  and c) the  Account's  Investment  Guidelines  attached as
Exhibit A. In addition,  in accordance  with the Manager's  guidelines in effect
from time to time,  the  Manager  or its agent is  authorized,  but shall not be
required,  to vote, tender or convert any securities in the Account;  to execute
waivers,  consents and other  instruments  with respect to such  securities;  to
endorse,  transfer or deliver such securities or to consent to any class action,
plan of  reorganization,  merger,  combination,  consolidation,  liquidation  or
similar plan with reference to such securities;  and the Manager shall not incur
any  liability  to the  Company  by reason of any  exercise  of, or  failure  to
exercise, any such discretion in the absence of gross negligence or bad faith.

<PAGE>

4.  Accounting  and Reports.  The Manager shall furnish the Company with monthly
appraisals of the Account,  performance tabulations,  a summary of purchases and
sales and such  other  reports  as shall be agreed  upon from time to time.  The
Manager shall also  reconcile  accounting,  transaction  and asset- summary data
with custodian reports in accordance with the Manager's standard procedures.  In
addition,   the  Manager   shall   communicate   and  resolve  any   significant
discrepancies with the custodian.

5. Other  Services.  The Manager  shall,  on  invitation,  attend  meetings with
representatives  of the Company to discuss  the  position of the Account and the
immediate  investment  outlook,  or shall  submit  its views in  writing  as the
Company shall suggest from time to time.

6.  Compensation.  For services  hereunder,  the Manager shall be compensated in
accordance  with Exhibit B, attached  hereto.  If the  management of the Account
commences  or ends at any time  other  than the  beginning  or end of a calendar
quarter,  the  quarterly  fee shall be  prorated  based on the  portion  of such
calendar quarter during which this Agreement was in force.

7.  Custodian.  The  securities in the Account shall be held by a custodian duly
appointed by the Company and the Manager is authorized to give  instructions  to
the custodian  with respect to all investment  decisions  regarding the Account.
Except as  provided in  Paragraph 3 above,  nothing  contained  herein  shall be
deemed to authorize the Manager to take or receive physical possession of any of
the assets for the  Account,  it being  intended  that sole  responsibility  for
safekeeping  thereof  (in such  investments  as the  Manager may direct) and the
consummation of all purchases,  sales,  deliveries and investments made pursuant
to the Manager's direction shall rest upon the custodian.

8.  Brokerage.  The Company  hereby  delegates to the Manager sole and exclusive
authority to designate  the brokers or dealers  through whom all  purchases  and
sales on behalf of the Account will be made. The Manager will determine the rate
or rates, if any, to be paid for brokerage services provided to the Account. The
Manager agrees that  securities are to be purchased  through such brokers as, in
the  Manager's  best  judgment,  shall offer the best  combination  of price and
execution.  The  Manager,  in  seeking to obtain  best  execution  of  portfolio
transactions  for the  Account,  may  consider  the quality and  reliability  of
brokerage  services,  as well as research and investment  information  and other
services provided by brokers or dealers. Accordingly, the Manager's selection of
a broker or dealer for  transactions  for the Account may take into account such
relevant  factors  as (i)  price,  (ii) the  broker's  or  dealer's  facilities,
reliability and financial  responsibility,  (iii) when relevant,  the ability of
the broker to effect securities  transactions,  particularly with regard to such
aspects as timing,  order size and execution of the order,  (iv) the broker's or
dealer's  recordkeeping  capabilities  and (v) the research  and other  services
provided by such broker or dealer to the Manager  which are  expected to enhance
its  general  portfolio  management  capabilities  (collectively,   "Research"),
notwithstanding  that the Account may not be the exclusive  beneficiary  of such
Research.

9.  Confidential   Information.   All  information   regarding   operations  and
investments of the Company shall be regarded as confidential by the Manager.

<PAGE>

10. Directions to the Manager.  All directions by or on behalf of the Company to
the Manager shall be in writing signed by any two of the following:

         Name                                    Title

     Ronald W. Jones                             Vice President, Finance
     Michael R. Boyce                            Secretary
     Peter R.P. Evelyn                           Director

     The Manager  shall be fully  protected  in relying  upon any  direction  in
accordance  with  the  previous  paragraph  with  respect  to  any  instruction,
direction or approval of the Company,  and shall be so protected also in relying
upon a  certification  duly executed on behalf of the Company as to the names of
persons  authorized  to  act  for  it  and  in  continuing  to  rely  upon  such
certification until notified by the Company to the contrary.

     The  Manager  shall be  fully  protected  in  acting  upon any  instrument,
certificate  or paper believed by it to be genuine and to be signed or presented
by the  proper  persons or to any  statement  reasonably  contained  in any such
writing and may accept the same as conclusive evidence of the truth and accuracy
of the statements therein contained.

11. Liabilities of the Manager and the Company. The Company acting in good faith
shall not be liable for any act or omission of the  Manager in  connection  with
the Manager's discharge of its duties; provided,  however, this limitation shall
not act to relieve the Company  from any  responsibility  or  liability  for any
fiduciary  responsibility,  obligation  or  duty.  The  Manager,  its  officers,
directors and employees,  acting in good faith shall not be liable, and shall be
indemnified by the Company against any and all losses,  damages, costs, expenses
(including reasonable attorneys' fees), liabilities, claims and demands, for any
action,  omission,   information  or  recommendation  in  connection  with  this
Agreement, except in the case of the Manager's or such officer's,  director's or
employee's  actual  misconduct,  gross  negligence,  willful  violation  of  any
applicable statute or reckless disregard for its duties; provided, however, this
limitation  shall not act to relieve the Manager,  its  officers,  directors and
employees  from  any   responsibility  or  liability  for  any   responsibility,
obligation or duty which the Manager or such  officer,  director or employee may
have under any applicable securities act.

12.  Non-Exclusive  Management.  The Company  understands  that the Manager will
continue to furnish  investment  management and advisory services to others, and
that  the  Manager  shall  be at all  times  free,  in its  discretion,  to make
recommendations  to others  which may be the same as, or may be  different  from
those made to the Account. The Company further understands that the Manager, its
affiliates,  and any officer, director,  stockholder,  employee or any member of
their families may or may not have an interest in the securities  whose purchase
and sale the Manager may  recommend.  Actions with respect to  securities of the
same kind may be the same as or different from the action which the Manager,  or
any of its affiliates, or any officer,  director,  stockholder,  employee or any
member of their families, or other investors may take with respect thereto.

<PAGE>

13.  Aggregation  and  Allocation  of  Orders.  The  Company  acknowledges  that
circumstances may arise under which the Manager  determines that, while it would
be both desirable and suitable that a particular security or other investment be
purchased  or sold for the  account of more than one of the  Manager's  clients'
accounts,  there  is a  limited  supply  or  demand  for the  security  or other
investment.  Under such circumstances,  the Company acknowledges that, while the
Manager will seek to allocate the  opportunity to purchase or sell that security
or other  investment  among those  accounts on an equitable  basis,  the Manager
shall not be required to assure  equality of treatment  among all of its clients
(including  that the  opportunity  to  purchase  or sell that  security or other
investment will be proportionally allocated among those clients according to any
particular or predetermined standards or criteria). Where, because of prevailing
market  conditions,  it is not  possible  to  obtain  the same  price or time of
execution for all of the securities or other  investments  purchased or sold for
the Account, the Manager may average the various prices and charge or credit the
Account with the average price.

14.  Conflict of Interest.  The Company agrees that the Manager may refrain from
rendering any advice or services concerning securities of companies of which any
of the  Manager's,  or  affiliates  of the  Manager's  officers,  directors,  or
employees are directors or officers, or companies as to which the Manager or any
of the Manager's  affiliates or the officers,  directors and employees of any of
them has any  substantial  economic  interest or possesses  material  non-public
information,  unless the  Manager  either  determines  in good faith that it may
appropriately do so without disclosing such conflict to the Company or discloses
such  conflict to the Company  prior to rendering  such advice or services  with
respect to the Account.

     From time to time,  when  determined  by the  Manager in its  capacity of a
fiduciary to be in the best  interest of the  Company,  the Account may purchase
securities  from or sell securities to another account managed by the Manager at
prevailing  market levels in accordance with the procedures under Rule 17a- 7(b)
of the Investment Company Act of 1940 and other applicable law.

15.  Effective  Period of Agreement and Amendments.  This Agreement shall become
effective on the date hereof.  Any amendment to this Agreement  shall be written
and signed by both parties to the Agreement.

16.  Resignation  or Removal of the  Manager.  The Manager may be removed by the
Company or may resign upon 30 days' notice in writing.  On the effective date of
the  removal  or  resignation  of the  Manager  or as close  to such  date as is
reasonably  possible,  the Manager shall provide the Company with a final report
containing the same information as required by paragraph 4 above.

17. Assignment. Except as otherwise specifically set forth in this Agreement, no
assignment  of this  Agreement by the Manager may be made without the consent of
the Company, and any such assignment made without such consent shall be null and
void for all purposes.  Subject to the foregoing,  this Agreement shall inure to
the benefit of and be binding  upon the parties  hereto,  their  successors  and
permitted assigns.

<PAGE>

18.  Severable.  Any term or  provision  of this  Agreement  which is invalid or
unenforceable in any applicable jurisdiction shall, as to such jurisdiction,  be
ineffective  to the  extent  of  such  invalidity  or  unenforceability  without
rendering  invalid or  unenforceable  the  remaining  terms or provisions of the
Agreement in any jurisdiction.

19. Applicable Law. This Agreement shall be construed  pursuant to, and shall be
governed by, the laws of Scotland.

20. Web-site.  The Manager, at the Company's request, will provide access to its
account  information  electronically,  via the world  wide web,  based  upon the
Company's  use  of  a  BlackRock  issued  user  id  and  password.  The  Company
acknowledges  and agrees the world wide web is a continually  growing medium and
the Manager does not make any  warranty  regarding  the security  related to the
world wide web. The Company must be aware there is no absolute guaranteed system
or  technique  to fully  secure  information  made  available  over the web. The
Company  agrees  that it will not  share  its user id,  password  and  access to
information provided electronically with any third party.

21. Notices.  All notices  required or permitted to be sent under this Agreement
shall be sent, if to the Manager:

                        BlackRock International, Ltd.
                        7 Castle Street
                        Edinburgh EH2 3AM Scotland
                        United Kingdom
                        Attn:  Gordon Anderson, Portfolio Manager

With a copy to:
                        BlackRock Financial Management, Inc.
                        345 Park Avenue, 30th Floor
                        New York, NY 10154
                        Attention: Robert Connolly, General Counsel

                        or by facsimile to (212) 409-3744

if to the Company:
                        One Financial Place
                        Collymore Rock
                        St. Michael, Barbados W.I.

or such other name or address as may be given in writing to the other party. All
notices  hereunder  shall be  sufficient if delivered by  facsimile,  telex,  or
overnight mail. Any notices shall be deemed given only upon actual receipt.

<PAGE>

     IN WITNESS  WHEREOF,  the parties  hereto have caused this  Agreement to be
duly executed as of the date first above written.

INTEGON RE (BARBADOS), LIMITED

By:      /s/ Ronald W. Jones
         _______________________________

Name:    Ronald W. Jones

Title:   Vice President, Finance

BLACKROCK INTERNATIONAL, LTD.

By:      /s/ Laurence D. Fink
         _______________________________

Name:    Laurence D. Fink

Title:   Chairman

<PAGE>

                         Integon Re (Barbados), Limited
                        Investment Guidelines (Exhibit A)

The Portfolio           The Integon Re (Barbados) Portfolio (the Portfolio) is a
                        separate  account  managed by  BlackRock  International,
                        Ltd. for the  benefit of Integon  Re (Barbados), Limited
                        (the Company).

Investment Objective    The Portfolio's  investment objective  is to  provide  a
                        total  return   that  exceeds  the  total return  of the
                        Lehman Intermediate Aggregate Index (the Index).

Duration Guidelines     The  Portfolio  will  be  managed  to  have  a  targeted
                        duration  within a band  of+/-20% around the duration of
                        the Index.

Asset Guidelines        Following are the eligible investments:

                        (i) U.S. Treasury and agency securities;

                        (ii) Agency and  non-agency  mortgage-backed  securities
                        backed  by loans secured by residential, multifamily and
                        commercial  properties  including,  but  not  limited to
                        pass-throughs,  CMOs,  REMICs,   SMBS,   project  loans,
                        construction loans, and adjustable rate

                        (iii) obligations of  domestic and  foreign corporations
                        and banks, including Yankees and eurobonds;

                        (iv) asset-backed securities;

                        (v) taxable municipal securities

                        (vi) money market instruments

                        The  Portfolio may  purchase private  placement or  Rule
                        144A securities.

Asset Allocation        Except for Treasury or Agency  debentures, pass-throughs
                        or REMICs, no more than 5% of the Portfolio's assets may
                        be invested in securities of a single issuer.

Credit Criteria         Securities must be rated investment grade or better by a
                        nationally  recognized credit  rating agency at the time
                        of purchase.  Split rated  credits will be considered to
                        have the higher credit rating.

                        Securities rated BBB or equivalent are limited to 10% of
                        portfolio net assets.

<PAGE>

                        In the event  that a Portfolio  investment is downgraded
                        below  these  credit quality guidelines,  the Investment
                        Manager  shall   notify  the  Company   and  provide  an
                        evaluation and a recommended course of action.

                        Money  market  instruments  must  be  rated  A-1 or P or
                        better at the time of purchase.

Tax Consideration       The  Portfolio's assets  will not  be invested   in  any
                        securities or sweep funds that to the knowledge  of  the
                        Manager  at  the  time  of  purchase  or investment, are
                        subject to U.S. withholding tax.

Other Investment
Practices               Temporary cash balances may be invested by BlackRock in
                        a money market instrument (A1/P1 or better, less than
                        390 days) or in a client approved sweep vehicle not
                        subject to U.S. withholding tax.

                        The Portfolio may purchase securities on a when-issued
                        basis or for forward delivery.

                        The  Portfolio  may  enter  into  repurchase  agreements
                        collateralized 102% with  U.S. Government securities  or
                        mortgage securities as defined  above.  The maximum term
                        of these agreements  will be 90 days, and the collateral
                        must be marked-to-market daily.

                        The Portfolio may enter into  covered  dollar  rolls  on
                        mortgage securities.  Covered agreements will be defined
                        as having similar maturities.

Reinvestment of Income  All investment  income  of  the  Portfolio  and  capital
                        gains,  if  any,  will  be  added  to  the assets of the
                        Portfolio,  unless  otherwise  directed by the Company.

Custodian               Comerica Bank

<PAGE>

                                    Exhibit B

As compensation for rendering  services under the Investment  Manager Agreement,
the Manager shall be paid a quarterly Management Fee in arrears according to the
Fee Schedule provided below. All assets managed by the Manager for the companies
General Mechanical Reinsurance Company,  Limited,  Motors Mechanical Reinsurance
Company, Limited, Integon Re (Barbados), Limited and any other related entities,
except if otherwise agreed to, will be consolidated under this Fee Schedule. The
Management  Fee will be based on the net asset value of the combined  portfolios
at the end of each calendar quarter.

Fee Schedule:

Aggregate Portfolio Net Assets                       Fee (bps)
-------------------------------                      ---------
First $50 million                                    25
Assets over $50 million                              6.5

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