Document:

Exhibit 10.19

 

ASSIGNMENT AGREEMENT

 

This Assignment Agreement, dated as of April 28, 2004 (this “Agreement”),
is made by and among Assured Guaranty Re Overseas Ltd., formerly known as ACE
Capital Re Overseas Ltd., (“AGRO”), ACE European Markets Insurance Limited
(“AEM”) and ACE Bermuda Insurance Ltd. (“ACE Bermuda”).

 

RECITALS

 

WHEREAS, AEM and AGRO have entered into that certain UK Title Quota
Share Reinsurance Agreement, dated as of June 1, 2003, a copy of which is
attached hereto as Annex A (the “2003 Reinsurance Agreement”);

 

WHEREAS, AEM and AGRO have entered into that certain Quota Share
Reinsurance Agreement (including the (i) Special Acceptance, effective as of
August 15, 2002 and (ii) Termination Agreement, dated as of May 31, 2003,
in each case made in respect of and subject to such Quota Share Reinsurance
Agreement), effective as of January 1, 2002, copies of which are attached
hereto as Annex B (the “2002 Reinsurance Agreement” and together with
the 2003 Reinsurance Agreement, the “Reinsurance Agreements”);

 

WHEREAS,
AGRO desires to assign, transfer and novate all of its past, present and future
right, title, interest and obligations in, to and under the Reinsurance
Agreements to ACE Bermuda as set forth in this Agreement;

 

WHEREAS,
ACE Bermuda desires to accept all of AGRO’s past, present and future right,
title, interest and obligations in, to and under the Reinsurance Agreements as
set forth in this Agreement; and

 

WHEREAS,
AEM desires to consent to the assignment, transfer and novation referred to
above and to release AGRO from liability under the Reinsurance Agreements.

 

NOW,
THEREFORE, in consideration of the mutual promises and covenants contained
herein and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto hereby agree
as follows:

 

1.                                       Effective
as of April 1, 2004 and subject to receipt by ACE Bermuda of the amount
referred to in Section 2 herein:

 

(i)                                     AGRO hereby
assigns, transfers and novates all of its past, present and future right, title
and interest in the Reinsurance Agreements to ACE Bermuda;

 

(ii)                                  AGRO hereby assigns,
transfers and novates all of its past, present and future obligations which
arise out of, relate to, or are in any way connected with, the Reinsurance
Agreements to ACE Bermuda;

 

 

(iii)                               ACE Bermuda hereby
accepts each assignment, transfer and novation referred to in the immediately
preceding clauses (i) and (ii) and assumes all of the liabilities and
obligations (whether past, present or future) with respect to the foregoing;
and

 

(iv)                              AEM hereby acknowledges
and consents to each assignment, transfer and novation referred to in clauses
(i) and (ii) of this Paragraph 1.

 

2.                                       In furtherance
of the foregoing, AEM hereby releases AGRO from any and all past, present or
future liabilities or obligations with respect to the Reinsurance Agreements,
and ACE Bermuda hereby agrees to indemnify and hold AGRO harmless against any
and all such liabilities and obligations.

 

3.                                       Within three
days of the date of this Agreement, AGRO will pay US$1,618,108.97 to ACE
Bermuda by wire transfer of funds to an account designated by ACE Bermuda.

 

4.                                       Each party
hereto shall, at any time and from time to time after the first date written
above, upon request of any other party hereto, do, execute, acknowledge and
deliver, or cause to be done, executed, acknowledged and delivered, all such
further acts, instruments, assignments and assurances as may be reasonably
required in order to carry out the intent of this Agreement.

 

5.                                       Except
as expressly set forth herein and amended hereby, the Reinsurance Agreements
shall remain in full force and effect.

 

6.                                       This
Agreement contains the entire agreement and understanding of the parties hereto
with respect to the matters herein and supersedes any other agreement, whether
written or oral, with respect to the subject matter of this Agreement.

 

7.                                       This
Agreement may be executed in any number of counterparts, each of which will be
deemed to be an original copy of this Agreement and all of which, when taken
together, will be deemed to constitute one and the same agreement.

 

8.                                       This
Agreement shall be governed by and construed in accordance with the laws of the
State of New York, without regard to the conflicts of law rules thereof.

 

2

 

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

 

 

	
  ASSURED GUARANTY RE
  OVERSEAS LTD.

  
	
   

  
	
  By:

  	
  /s/ Norie R. Bregman

  	
   

  
	
  Name:  Norie R. Bregman

  
	
  Title:    EVP

  
	
   

  
	
  ACE BERMUDA
  INSURANCE LTD.

  
	
   

  
	
  By:

  	
   

  	
   

  
	
  Name:

  
	
  Title:

  
	
   

  
	
  ACE EUROPEAN MARKETS
  INSURANCE

  LIMITED

  
	
   

  
	
  By:

  	
   

  	
   

  
	
  Name:

  
	
  Title:

  

 

 

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

 

 

	
  ASSURED GUARANTY RE
  OVERSEAS LTD.

  
	
   

  
	
  By:

  	
   

  	
   

  
	
  Name:

  
	
  Title:

  
	
   

  
	
  ACE BERMUDA
  INSURANCE LTD.

  
	
   

  
	
  By:

  	
  /s/ Andrew M. Gibbs

  	
   

  
	
  Name:  Andrew M. Gibbs

  
	
  Title:    CFO

  
	
   

  
	
  ACE EUROPEAN MARKETS
  INSURANCE

  LIMITED

  
	
   

  
	
  By:

  	
   

  	
   

  
	
  Name:

  
	
  Title:

  

 

 

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

 

 

	
  ASSURED GUARANTY RE
  OVERSEAS LTD.

  
	
   

  
	
  By:

  	
   

  	
   

  
	
  Name:

  
	
  Title:

  
	
   

  
	
  ACE BERMUDA
  INSURANCE LTD.

  
	
   

  
	
  By:

  	
   

  	
   

  
	
  Name:

  
	
  Title:

  
	
   

  
	
  ACE EUROPEAN MARKETS
  INSURANCE

  LIMITED

  
	
   

  
	
  By:

  	
  /s/ James C Hooban

  	
   

  
	
  Name:  James C Hooban

  
	
  Title:    Managing Director

  

 

ANNEX
A

 

UK TITLE QUOTA SHARE REINSURANCE AGREEMENT

 

BETWEEN

 

ACE EUROPEAN MARKETS INSURANCE LIMITED

(REINSURED)

 

AND

 

ACE CAPITAL RE OVERSEAS LTD.

(REINSURER)

 

 

UK TITLE QUOTA SHARE REINSURANCE AGREEMENT

 

This
UK Title Quota Share Reinsurance Agreement (“Agreement”),
dated as of June 1, 2003, is made and entered into by and between ACE
European Markets Insurance Limited (the “Reinsured”)
and ACE Capital Re Overseas Ltd. (the “Reinsurer”)

 

In
consideration of the mutual covenants contained herein, and for other good and
valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the Reinsured and the Reinsurer agree as follows:

 

	
  TERM:

  	
   

  	
  Means the period from and including June 1, 2003 to
  and including the last day of the Underwriting Period (as defined in the
  Agency Agreement).

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Upon the end of the Term, this Agreement shall remain in
  effect with respect to Issued Contracts (as defined in the Agency Agreement)
  which are issued by the Reinsured on or prior to the last day of the Term
  until the earlier of their natural expiration, termination, or renewal and
  the Reinsured shall continue to account to the Reinsurer for any Reinsurance
  Premium, recoveries and other amounts payable in respect of such Issued
  Contracts.

  
	
   

  	
   

  	
   

  
	
  AGENCY AGREEMENT:

  	
   

  	
  Means that certain Underwriting Management Agreement,
  dated May 15, 2003 and effective June 1, 2003, by and between the
  Reinsured and Legal & Contingency Limited (the “Agent”).

  
	
   

  	
   

  	
   

  
	
  REINSURING AGREEMENT:

  	
   

  	
  The Reinsured shall cede to the Reinsurer, and the
  Reinsurer shall accept as reinsurance from the Reinsured, one-hundred percent
  (100%) (the  “Quota
  Share Percentage”) of the liability of the Reinsured under any and
  all Issued Contracts issued or entered into by the Reinsured during the Term.

  
	
   

  	
   

  	
   

  
	
  EXCLUSIONS:

  	
   

  	
  This Agreement does not cover any business other than
  Issued Contracts.

  
	
   

  	
   

  	
   

  
	
  REINSURANCE PREMIUM:

  	
   

  	
  The Reinsured shall pay the Reinsurer an amount equal to
  (a) 92.50% (“Premium Percentage”)
  of the Gross Written Premium on each Issued Contract (the “Reinsurance Premium”) less (b) the
  amount payable by the Reinsured to the Agent (as hereinafter defined)
  pursuant to Section 5.2 of the Agency Agreement. As used herein “Gross Written Premium” means gross
  premium written less cancellations and return premiums.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  For purposes of clarification and not limitation, the
  Premium Percentage is net of all commissions and is calculated as provided in
  Schedule 1 attached hereto.

  
	
   

  	
   

  	
   

  
	
  PROFIT COMMISSION:

  	
   

  	
  The Reinsurer shall pay the
  Reinsured, on the day that is one business day prior to the day the Profit
  Commission (as defined in the Agency

  

 

 

	
   

  	
   

  	
  Agreement) is payable by the
  Reinsured to the Agent pursuant to Section 5.1 of the Agency Agreement,
  an  amount equal to such Profit
  Commission.

  
	
   

  	
   

  	
   

  
	
  FULL REINSURANCE CLAUSE:

  	
   

  	
  The Reinsurer shall at all times
  follow the loss settlements made by the Reinsured (provided they are within
  the terms of the applicable Issued Contract and this Agreement) and pay the
  Reinsured the Quota Share Percentage of the loss adjustment expenses (other
  than management and office expenses of the Reinsured and salaries of its
  employees) paid by the Reinsured in connection with the investigation,
  settlement or contesting the validity of claims or losses, including, without
  limitation, the fees and expenses of attorneys and experts.

  
	
   

  	
   

  	
   

  
	
  SIMULTANEOUS PAYMENT CLAUSE:

  	
   

  	
  

  In the event any claim covered by this Agreement exceeds twenty five thousand
  pounds sterling (£25,000), the Reinsurer agrees that, if requested, it shall
  pay its share of such loss by wire transfer of same day Federal Funds by
  12:00 pm New York Time on the date which is one business day prior to
  the date such loss payment is expected to be paid by the Reinsured.

  
	
   

  	
   

  	
   

  
	
  TERRITORY:

  	
   

  	
  This Agreement shall provide coverage
  on properties located in Great Britain, Northern Ireland, Isle of Mann and
  Channel Islands.

  
	
   

  	
   

  	
   

  
	
  CLAIMS CO-OPERATION:

  	
   

  	
  The Reinsured shall give immediate
  notice to the Reinsurer upon its becoming aware of any claim under an Issued
  Contract or any circumstance which could give rise to such a claim.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  The Reinsured shall furnish the
  Reinsurer with all information known to the Reinsured respecting claims or
  possible claims notified and shall thereafter keep the Reinsurer fully
  informed as regards all developments relating thereto as soon as they occur.
  So long as the Reinsurer is not in default of its obligations under this
  Agreement, the Reinsurer shall have the right to direct the Reinsured (and
  the Reinsured shall act in accordance with the direction of the Reinsurer) in
  connection with the investigation, adjustment, settlement and litigation of
  any claim or potential claim arising under an Issued Contract and the
  Reinsured shall not adjust, settle or litigate any claim without the prior
  written consent of the Reinsurer or its representative.

  
	
   

  	
   

  	
   

  
	
  SUBROGATION AND RECOVERY:

  	
   

  	
  In the event the Reinsured has any
  rights of subrogation, salvage, recovery or claims reimbursement or rights
  against any person or entity who or which may be legally responsible in
  damages for any loss that is the subject of a valid claim under an Issued
  Contract (individually and collectively, “Recoveries”),
  the Reinsured shall use its best efforts to pursue such Recoveries, provided that, so long as the Reinsurer
  is not in default of its obligations under this Agreement, the Reinsurer
  shall have the sole right to direct the Reinsured (and the Reinsured shall
  act in accordance with the direction of the Reinsurer) in connection with any
  right of Recovery.

  

 

2

 

	
   

  	
   

  	
  The Reinsured shall account to, and
  credit, the Reinsurer with the Quota Share Percentage of any Recoveries
  (after deduction of the costs of obtaining such Recoveries) received or
  recovered by the Reinsured. This provision shall survive the Term and remain
  in effect until all Recoveries relating to any claim paid by the Reinsurer
  hereunder shall have been obtained.

  
	
   

  	
   

  	
   

  
	
  EXTRA CONTRACTUAL
  OBLIGATIONS:

  	
   

  	
  

  In the event the Reinsured pays or is held liable to pay any punitive,
  exemplary, compensatory or consequential damages (herein referred to as “Extra Contractual Obligations”) because
  of alleged or actual bad faith or negligence on its part in handling a claim
  under an Issued Contract covered hereunder, such Extra Contractual
  Obligations shall be added to the Reinsured’s loss, if any, under the Issued
  Contract involved, and the sum thereof shall be (i) subject to the protection
  of this Agreement and (ii) the obligation of the Reinsurer notwithstanding
  any other limitation of this reinsurance coverage.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  An Extra Contractual Obligation shall
  be deemed to have occurred on the same date as the claim covered or alleged
  to be covered under this Agreement.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Recoveries from any form of coverage
  that protects the Reinsured against claims that are the subject matter of
  this provision shall inure to the benefit of the Reinsurer.

  
	
   

  	
   

  	
   

  
	
  LOSS IN EXCESS OF
  POLICY LIMITS:

  	
   

  	
  

  This Agreement shall protect the Reinsured in respect of any loss that the
  Reinsured may be legally liable to pay in excess of the limit of its Issued
  Contracts, including, without limitation, any loss in excess of that limit
  having been incurred because of its failure to settle within the insurance
  limit or by reason of alleged or actual negligence, fraud or bad faith in
  rejecting an offer of settlement or in the preparation of the defence or in
  trial of any action against the original insured or in the preparation or
  prosecution of an appeal consequent upon such action.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  For the purposes of this provision,
  the word “loss” shall mean any amount that the Reinsured would have been
  contractually obligated to pay had it not been for the limit of an Issued
  Contract.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Recoveries from any form of coverage
  that protects the Reinsured against claims that are the subject matter of
  this provision shall inure to the benefit of the Reinsurer.

  
	
   

  	
   

  	
   

  
	
  ERRORS AND
  OMISSIONS:

  	
   

  	
  Any inadvertent delay, omission, or
  error shall not be held to relieve either party hereto from any liability
  which would attach to  it
  hereunder if such delay, omission or error had not been made, providing such
  omission or error is rectified upon discovery.

  

 

3

 

	
  REPORTS AND REMITTANCES:

  	
   

  	
  The Reinsured shall provide the Reinsurer with a monthly
  policy and premium bordereaux within fifteen (15) days following the end of
  each calendar month showing:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (i)

  	
  The
  dollar amount of the Reinsurance Premium due for such month,

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (ii)

  	
  The dollar amount payable by the Reinsured to the Agent
  pursuant to Section 5.2
  of the Agency Agreement,

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (iii)

  	
  the dollar amount of the Quota Share
  Percentage of losses paid by the Reinsured in respect of Issued Contracts
  during such month,

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (iv)

  	
  the amount of any salvages, subrogation and other
  recoveries received by the Reinsured during such month with
  respect to losses covered under the Issued Contracts, and

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  (v)

  	
  such
  policy detail as agreed by the parties.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  If the Net Due with respect to any calendar month is a
  positive number; the Reinsured shall pay such Net Due to the Reinsurer within
  forty-five (45) days following the end of such calendar month. If the Net Due
  with respect to any calendar month is a negative number, the Reinsurer shall
  pay the absolute value of such Net Due to the Reinsured within forty-five
  (45) days following the end of such calendar month. As used herein, the term
  “Net Due” means the difference between (a) the sum of clauses (i) and (iv) of
  this section and (b) the sum of clauses (ii) and (iii) of this section.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  In addition to the items set forth in clauses (i) through
  (v) above, the Reinsured shall provide the Reinsurer with (a) within five (5)
  business days of receipt thereof, a copy of the bordereaux received from the
  Agent pursuant to Clause 4.2 of Appendix B of the Agency Agreement and (b)
  within 45 days of each Fiscal Year (as defined in the Agency Agreement) of
  the Underwriting Period, a detailed computation of the Profit Commission
  payable pursuant to Section 5.1 of the Agency Agreement.

  
	
   

  	
   

  	
   

  
	
  AMENDMENTS AND ASSIGNMENT:

  	
   

  	
  This Agreement may not be assigned without the prior
  written consent of the Reinsurer and the Reinsured.  This Agreement may be amended only by a
  written instrument executed by the Reinsurer and the Reinsured. Such duly executed
  amendments will be considered an integral part of this Agreement.

  
	
   

  	
   

  	
   

  
	
  BOOKS AND RECORDS:

  	
   

  	
  For as long as either party remains under any liability
  hereunder, the Reinsured shall, upon request by  the Reinsurer, make available for inspection at any
  reasonable time by such representatives as may be authorised by the Reinsurer
  for that purpose, all information relating to business reinsured hereunder in
  the Reinsured’s possession or under its control or to which it has access
  under any agreement and the Reinsurer

  

 

4

 

	
   

  	
   

  	
  shall be
  permitted to make copies of such information (at its own expense).

  
	
   

  	
   

  	
   

  
	
  SET OFF:

  	
   

  	
  Either party may at its discretion
  set off against any amounts due from the other party under this Agreement or
  any other agreements between the parties any amounts that are due and owing
  to the other party.

  
	
   

  	
   

  	
   

  
	
  EXERCISE OF RIGHTS
  UNDER AGENCY AGREEMENT:

  	
   

  	
  

  The Reinsured hereby expressly agrees that (a) prior to exercising any right
  as the “Insurer” under the Agency Agreement it shall (i) notify the Reinsurer
  in writing of its intention with respect to such right to be exercised and
  (ii) exercise any such right only with the prior written consent of the
  Reinsurer and (b) it will exercise any right or refrain from exercising any
  right as the “Insurer” under the Agency Agreement as directed by the
  Reinsurer.

  
	
   

  	
   

  	
   

  
	
  AMENDMENT OF AGENCY
  AGREEMENT:

  	
   

  	
  

  The Agency Agreement may not be amended, assigned or otherwise modified
  without the prior written consent of the Reinsurer.

  
	
   

  	
   

  	
   

  
	
  ARBITRATION:

  	
   

  	
  Any dispute, controversy, or claim
  arising out of or relating to this Agreement, or the breach, termination or
  invalidity thereof, shall be finally settled under the Rules of Arbitration
  of the LCIA (“LCIA Rules”):by one or three arbitrators appointed in
  accordance with the LCIA Rules. The seat of the arbitration shall be London.
  The language of the arbitration shall be English. Judgment on any award may
  be entered in any court of competent jurisdiction.

  
	
   

  	
   

  	
   

  
	
  GOVERNING LAW:

  	
   

  	
  This Agreement shall be governed by,
  and construed in accordance with, English law and the parties hereby submit
  to the non-exclusive jurisdiction of the English courts for all purposes
  relating to this Agreement.  This
  clause is not intended to override the agreement of the parties to arbitrate
  as set forth in the “Arbitration” section hereof.

  
	
   

  	
   

  	
   

  
	
  THIRD PARTY RIGHTS:

  	
   

  	
  Nothing herein shall be deemed to
  create any obligation or to establish any right against in favor of any third
  parties or persons not parties to this Agreement.

  
	
   

  	
   

  	
   

  
	
  COUNTERPARTS:

  	
   

  	
  This Agreement may be executed in any
  number of counterparts, and by different parties hereto in separate
  counterparts, each of which when so executed and delivered shall be an
  original, but all of which shall together constitute one and the same instrument.

  
	
   

  	
   

  	
   

  
	
  HEADINGS:

  	
   

  	
  The headings of the several sections
  and subsections of this Agreement are inserted for convenience only, and
  shall not in any way affect the meaning or construction of any provision of
  this Agreement.

  
	
   

  	
   

  	
   

  
	
  SEVERABILITY:

  	
   

  	
  To the extent that this Agreement may
  be in conflict with any applicable law or regulation, this Agreement shall be
  amended, at the mutual agreement of both the Reinsured and the Reinsurer, to
  the extent possible, to comply with such law and regulation. If any term or provision
  of this Agreement shall be found by a court of competent

  

 

5

 

	
   

  	
   

  	
  jurisdiction to be illegal or
  otherwise unenforceable, the same shall not invalidate the whole of this
  Agreement, but such term or provision shall be deemed modified to the extent
  necessary in the court’s opinion to render such term or provision
  enforceable, and the rights and obligations of the parties shall be construed
  and enforced accordingly preserving to the fullest permissible extent the
  intent and agreements of the parties set forth herein.

  
	
   

  	
   

  	
   

  
	
  CURRENCY:

  	
   

  	
  All payments by either party to the
  other under this Agreement are in Pounds Sterling.

  
	
   

  	
   

  	
   

  
	
  BROKERAGE:

  	
   

  	
  There shall be no broker or
  intermediary for this Agreement.

  
	
   

  	
   

  	
   

  
	
  NOTICES:

  	
   

  	
  Any notice required or permitted
  hereunder shall be in writing and shall be delivered personally, sent by
  facsimile transmission, sent by prepaid air courier or sent by certified,
  registered or express mail, postage prepaid. Any such notice shall be deemed
  delivered when received as follows:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  If to
  the Reinsurer:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  ACE Capital
  Re Overseas Ltd.

  
	
   

  	
   

  	
  Victoria
  Hall

  
	
   

  	
   

  	
  11 Victoria
  Street

  
	
   

  	
   

  	
  Hamiltoin
  HM HX, Bermuda

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Attention:

  	
  Corporate
  Secretary

  
	
   

  	
   

  	
  Telephone:

  	
  441-297-9730

  
	
   

  	
   

  	
  Facsimile:

  	
  441-297-9704

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  with
  a simultaneous copy to:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  ACE Capital
  Re Inc.

  
	
   

  	
   

  	
  1325 Avenue
  of the Americas

  
	
   

  	
   

  	
  New York,
  NY 10019

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Attention:

  	
  General
  Counsel

  
	
   

  	
   

  	
  Telephone:

  	
  212-974-0100

  
	
   

  	
   

  	
  Facsimile:

  	
  212-581-3268

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  If to
  the Reinsured:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  ACE European Markets Insurance
  Limited (London Branch)

  
	
   

  	
   

  	
  100 Leadenhall Street

  
	
   

  	
   

  	
  London EC3A 3BP

  
	
   

  	
   

  	
  United Kingdom

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Attention: Carmel Caramagna

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Facsimile:

  
	
   

  	
   

  	
  Telephone:  011 44 207 173 7000

  

 

6

 

	
   

  	
   

  	
  Any party may by notice given in
  accordance with this Section to the other parties designate another
  address or person for receipt of notices hereunder.

  
	
   

  	
   

  	
   

  
	
  ACCOUNTS:

  	
   

  	
  All payments shall
  be made to the accounts of the applicable party as follows:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  To the Reinsured:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Account Name:

  	
  ACE European Markets Insurance
  Limited

  
	
   

  	
   

  	
  Bank Name:

  	
  Bank of Ireland – Treasury

  
	
   

  	
   

  	
   

  	
  Colvill House

  
	
   

  	
   

  	
   

  	
  Talbot Street

  
	
   

  	
   

  	
   

  	
  Dublin 1 Ireland

  
	
   

  	
   

  	
  Bank Swift Address:

  	
  BIGTIE2D

  
	
   

  	
   

  	
  Account Number:

  	
  1819299

  
	
   

  	
   

  	
  IBAN Number:

  	
  IE03 BIGT 9024 8501 3489 22

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  To the Reinsurer:

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Financial Institution: JP
  Morgan/Chase

  
	
   

  	
   

  	
  ABA No.:

  	
  021-000-021

  
	
   

  	
   

  	
  Account No.:

  	
  910-2711-208

  
	
   

  	
   

  	
  Account Name:

  	
  ACE Capital Re Overseas

  

 

[The next page is the signature page.]

 

7

 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement  to be executed and delivered by their
duly authorized officers as of the effective date hereof.

 

	
  For and on behalf of the Reinsured:

  	
  For and on behalf of the Reinsurer:

  
	
   

  	
   

  
	
  ACE EUROPEAN MARKETS INSURANCE LIMITED

  	
  ACE CAPITAL RE OVERSEAS LTD.

  
	
   

  	
   

  
	
   

  	
   

  
	
  /s/ James C. Hooban

  	
   

  	
   

  	
   

  
	
  Name:

  	
  James C. Hooban

  	
  Name:

  
	
  Title:

  	
  Managing Director

  	
  Title:

  
	
  Date:

  	
  December 15, 2003

  	
  Date:

  
					

 

 

IN WITNESS WHEREOF, the parties hereto have caused
this Agreement to be executed and delivered by their duly authorized officers
as of the effective date hereof.

 

	
  For and on behalf of the Reinsured:

  	
  For and on behalf of the Reinsurer:

  
	
   

  	
   

  
	
  ACE EUROPEAN MARKETS INSURANCE
  LIMITED

  	
  ACE CAPITAL RE OVERSEAS LTD.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
  /s/ Rebecca
  L. Carne

  	
   

  
	
  Name:

  	
  Name:

  	
  Rebecca L. Carne

  	
   

  
	
  Title:

  	
  Title:

  	
  Director

  	
   

  
	
  Date:

  	
  Date:

  	
   

  	
   

  
						

 

 

SCHEDULE 1

 

CALCULATION OF PREMIUM
PERCENTAGE

 

The Premium Percentage is calculated as
follows:

 

	
  (A)  Gross Premiums
  Written (net of cancellations &  return
  premiums)

  	
  100.00

  	
  %

  
	
   

  	
   

  	
   

  
	
  (B) minus Ceding
  Commission to Reinsured (7.5% x (A))

  	
  (7.50

  	
  )%

  
	
   

  	
   

  	
   

  
	
  (C) equals Net
  to Reinsurer (or “Premium Percentage”)

  	
  92.50

  	
  %

  

 

 

ANNEX B

 

 

UK TITLE
QUOTA SHARE REINSURANCE AGREEMENT

 

BETWEEN

 

ACE
EUROPEAN MARKETS INSURANCE LIMITED

 

(REINSURED)

 

AND

 

ACE
CAPITAL RE INTERNATIONAL LTD.

 

(REINSURER)

 

1

 

QUOTA SHARE REINSURANCE AGREEMENT

 

This Quota Share Reinsurance
Agreement (“Agreement”), dated as of January
1, 2002, is made and entered into by and between ACE European Markets Insurance
Limited (the “Reinsured”) and ACE Capital Re
International Ltd.  (the
“Reinsurer”)

 

In consideration of the mutual covenants contained herein, and for
other good and valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, the Reinsured and the Reinsurer agree as follows:

 

	
  TERM AND
  TERMINATION:

  	
  This Agreement is
  effective at 12:01 a.m. GMT January 1, 2002 and shall remain in effect
  continuously until terminated at Midnight, GMT of any December 31st by either
  the Reinsured or  the Reinsurer
  giving the other party three (3) months’ prior written notice in writing.

  
	
   

  	
   

  
	
   

  	
  Upon termination, Policies
  issued or renewed on or after the effective date of termination shall not be
  ceded hereunder.  This Agreement shall
  remain in effect with respect to those Policies which are issued by the
  Reinsured prior to the effective date of termination until the earlier of
  their natural expiration, termination, or renewal and the Reinsured shall
  continue to account to the Reinsurer for any Premium, recoveries and other
  amounts payable in respect of such Policies.

  
	
   

  	
   

  
	
  REINSURING
  AGREEMENT:

  	
  In consideration of
  receipt of the Premium, the Reinsured shall cede to the Reinsurer, and the
  Reinsurer shall accept, as reinsurance from the Reinsured ninety percent
  (90%) of the liability of the Reinsured (the “Quota Share Percentage”) under any and all contracts of
  title insurance issued or entered into by the Reinsured during the Term which
  contracts are substantially in the form of Exhibit A attached hereto and
  underwritten by the Reinsured substantially in accordance with the
  Underwriting Guidelines attached hereto as Exhibit B (“Policy”, or in the plural, “Policies”)

  
	
   

  	
   

  
	
   

  	
  Special Acceptances. 
  Any contract of title insurance or reinsurance written by the
  Reinsured which does not comply with the definition of a Policy may be
  submitted to the Reinsurer for special acceptance.  If specially accepted by the Reinsurer,
  such contract shall be deemed to be a Policy and covered under and subject to
  the terms of this Agreement except
  to the extent that such terms shall be modified by such acceptance.

  
	
   

  	
   

  
	
   

  	
  For the avoidance of
  doubt, in respect of any Policy, the Reinsured’s liability under such Policy
  shall be calculated after deduction of the profit commission, if any, which
  is held by the Reinsured and from which the Reinsured is entitled to deduct
  losses under the Managing General Agency Agreement, if any, applicable to
  such Policy.  For the avoidance of
  doubt and unless otherwise agreed by the parties, no profit commission shall
  be applicable to any Policy reinsured under this Agreement unless a Managing
  General Agency Agreement applicable to

  

 

2

 

	
   

  	
  such Policy shall have been entered into by the
  Reinsured and such Agreement has been consented to by the Reinsurer.

  
	
   

  	
   

  
	
  EXCLUSIONS;

  	
  This Agreement does not cover any business not
  defined as a Policy unless specially accepted by the reinsurer in accordance with the section of this
  Agreement titled Reinsuring Agreement.

  
	
   

  	
   

  
	
  PREMIUM:

  	
  The Reinsured shall pay
  the Reinsurer 44.8875% (“Premium
  Percentage”) of the Net Premium
  Written an each Policy during the Term (“Premium”).  As used herein “Net Written Premium” means gross premium written less
  cancellations and return premiums.

  
	
   

  	
   

  
	
   

  	
  The Premium payable to the
  Reinsurer shall be calculated on the same gross rates and on the same basis
  as the  premiums received by the
  Company on the Policies.

  
	
   

  	
   

  
	
   

  	
  The Reinsured shall bear
  any and all taxes (net to its own account and without deduction from any
  amounts due the Reinsurer) which are due and payable at any time under or in
  connection with this Agreement and the Reinsured shall indemnify and hold the
  Reinsurer harmless in respect of any such taxes paid by the Reinsurer.

  
	
   

  	
   

  
	
   

  	
  For purposes of
  clarification and not limitation, the Premium Percentage is net of all commissions and is calculated
  as provided in Schedule 1 attached
  hereto.

  
	
   

  	
   

  
	
  FULL
  REINSURANCE CLAUSE:

  	
  The Reinsurer shall at all
  times follow the loss settlements made by the Reinsured (provided they are
  within the terms of the applicable Policy and this Agreement), and it’s share
  of payments on account, fees and expenses of experts and other loss
  settlements expenses (other than management and office expenses of the
  Reinsured and salaries of their employees) and legal expenses incurred in
  connection with the investigation, settlement or contesting the validity of
  claims or losses.

  
	
   

  	
   

  
	
  SIMULTANEOUS
  PAYMENT CLAUSE:

  	
  In the event any claim
  covered by this Agreement exceeds twenty five thousand pounds sterling
  (£25,000), the Reinsurer agrees that, if requested, it shall pay its share of
  such loss by wire transfer of same day federal funds by 12:00 pm Atlantic
  Standard Time on the later of: (a) three Business Days following the date of
  receipt by the Reinsurer of a special loss accounting which is prepared by
  the Reinsured and contains relevant details in connection with the claim, and
  (b) one Business Day prior to  the
  date such loss payment is made by the Reinsured; provided that, to the extent
  such payment is not made by the Reinsured and the Reinsured does not
  anticipate making such payment within seven (7) days of receipt of payment
  from the Reinsurer, the Reinsured promptly shall return any amounts so paid
  by the Reinsurer.  To the extent that
  the Reinsured makes such loss payment in an amount less than the amount

  

 

3

 

	
   

  	
  originally reported to the Reinsurer, the Reinsured
  shall promptly return the
  Reinsurer’s Quota Share Percentage of any such difference to the
  Reinsurer.  Nothing set forth in this
  clause shall be deemed to relieve or otherwise modify the obligations of the Reinsurer pursuant to the
  terms of this Agreement
  indemnify the Reinsured on the same day as the Reinsured makes a payment
  covered by it’s original Policy.

  
	
   

  	
   

  
	
  TERRITORY:

  	
  This Agreement shall
  provide coverage on properties located in the United Kingdom.

  
	
   

  	
   

  
	
  CLAIMS
  CO-OPERATION:

  	
  The Reinsured shall give
  immediate notice to the Reinsurer of any claim provided for in this Agreement
  made against the Reinsured in respect of business reinsured hereunder upon
  its becoming aware of any circumstances which could give rise to such a
  claim.

  
	
   

  	
   

  
	
   

  	
  The Reinsured shall
  furnish the Reinsurer with all information known to the Reinsured respecting
  claims or possible claims notified and shall thereafter keep the Reinsurer
  fully informed as regards all developments relating thereto as soon as they
  occur.  The Reinsured shall co-operate
  fully with the Reinsurer in the investigation, adjustment and settlement of any claim notified to the Reinsurer as
  aforesaid and the Reinsured shall not litigate any claim without consulting
  the Reinsurer or its representative. 
  The reinsured shall have
  the sole right to appoint adjusters,
  assessors and/or surveyors and to control all negotiations and/or adjustments
  and/or settlements in connection with all claims under an original
  Policy.  Notwithstanding the foregoing,
  when requested by the Reinsurer, the Reinsured shall permit the Reinsurer to
  associate in the defence and control of any investigation, claim, subrogation
  or recovery or other action pertaining to a Policy covered under this Agreement.

  
	
   

  	
   

  
	
  SUBROGATION
  AND RECOVERY:

  	
  In the event the Reinsured
  has any rights of subrogation, salvage, recovery or claims reimbursement or
  rights against any person or entity who may be legally responsible in damages
  for any loss that is the subject of a valid claim under a Policy
  (individually and collectively, “Recoveries”),
  the Reinsured shall pursue such Recoveries. 
  Notwithstanding the foregoing, the Reinsured shall only be obliged to
  enforce its rights of Recovery to the extent that the Reinsured reasonably
  believes that such exercise may be economically worthwhile.  The Reinsured shall have complete and sole
  control of the direction of all salvage remedies, and the Reinsurer shall be
  bound by the judgment of the Reinsured with respect thereto; provided,
  however, in the event the Reinsured fails to proceed to recoup
  any claim paid by the Reinsurer or in the event of the temporary or permanent
  discontinuance of the business of the Reinsured or the insolvency of the
  Reinsured, the Reinsurer shall
  have the right to assume and control enforcement of all of the rights of the
  Reinsured to recoup any claim paid by the Reinsurer

  

 

4

 

	
   

  	
  hereunder and the Reinsured
  shall cooperate fully with the Reinsurer in relation thereto.

  
	
   

  	
   

  
	
   

  	
  The Reinsured shall account to, and credit, the Reinsurer
  with the Quota Share Percentage of any Recoveries (after deduction of the
  costs of obtaining such Recoveries) received or recovered by the
  Reinsured.  This provision shall
  survive the Term and remain in effect until all recoveries, salvages or
  reimbursements relating to any claim paid by the Reinsurer hereunder shall
  have been obtained.

  
	
   

  	
   

  
	
  EXTRA CONTRACTUAL OBLIGATIONS:

  	
  In the event the Reinsured
  pays or is held liable to pay any punitive, exemplary, compensatory, or  consequential damages  (herein referred to as “Extra Contractual Obligations”) because
  of alleged or actual bad faith or negligence on its part in handling a claim
  under an original Policy covered hereunder, such Extra Contractual
  Obligations shall be added to the Reinsured’s loss, if any, under the Policy
  involved, and the sum thereof, not exceeding the limit of this reinsurance
  coverage, shall be subject to the protection of this Agreement.

  
	
   

  	
   

  
	
   

  	
  An Extra Contractual Obligation shall be deemed to
  have occurred on the same date as the claim covered or alleged to be covered
  under this Agreement.

  
	
   

  	
   

  
	
   

  	
  This provision shall not apply to any Extra
  Contractual Obligation incurred by the Reinsured as a result of the fraud of
  a member of the board of directors, or a corporate officer of the Reinsured
  acting individually or collectively or in collusion with any individual or
  corporation or any other organisation or party involved in the presentation,
  defence, or settlement of any claim covered hereunder.

  
	
   

  	
   

  
	
   

  	
  Recoveries from any form
  of coverage that protects the Reinsured against claims, which are the
  subject matter of this provision, shall inure to the benefit of the Reinsurer.

  
	
   

  	
   

  
	
  LOSS IN EXCESS OF POLICY LIMITS:

  	
  This Agreement shall
  protect the Reinsured in respect of any loss for which  the Reinsured may be legally liable to
  pay in excess of the limit of its original Policies.

  
	
   

  	
   

  
	
   

  	
  In addition, this Agreement shall protect the
  Reinsured in connection with any loss for which the Reinsured may  be legally liable to pay in excess of
  the limit of its original Policies, such loss in excess of that limit having
  been incurred because of its failure to settle within the insurance limit or
  by reason of alleged or actual negligence, fraud or bad faith in rejecting an
  offer of settlement or in the preparation of the defence or in trial of any
  action against the original insured or in the preparation or prosecution of
  an appeal consequent upon such action.

  

 

5

 

	
   

  	
  This provision shall not apply where the loss has
  been incurred due to the fraud of a member of the board of directors, or a
  corporate officer of the Reinsured acting individually or collectively or in
  collusion with any individual or corporation or any other organisation or
  party involved in the presentation, defence, or settlement of any claim
  covered hereunder.

  
	
   

  	
   

  
	
   

  	
  For the purposes of this provision, the word “loss”
  shall mean any amount for which the Reinsured would have been contractually
  obligated to pay had it not been for the limit of an original Policy.

  
	
   

  	
   

  
	
   

  	
  Recoveries from any form of coverage that protects
  the Reinsured against claims, which are the subject matter of this provision,
  shall inure to the benefit of the Reinsurer.

  
	
   

  	
   

  
	
  OTHER INSURANCE:

  	
  This Agreement applies to
  all risks net of any reinsurance ceded in accordance with the Reinsured’s
  Underwriting Guidelines.

  
	
   

  	
   

  
	
  ERRORS AND OMISSIONS:

  	
  Any inadvertent delay, omission, or error shall not
  be held to relieve either party hereto from any liability which would attach
  to it hereunder if such delay, omission or error had not been made, providing
  such omission or error is rectified upon discovery.

  
	
   

  	
   

  
	
  REPORTS AND REMITTANCES:

  	
  The Reinsured shall provide the Reinsurer with a  monthly policy and premium bordereaux
  within forty five (45) days following the end of each calendar month showing:

  
	
   

  	
   

  
	
   

  	
  (i)

  	
  The dollar amount of the Premium due for such month,

  
	
   

  	
   

  	
   

  
	
   

  	
  (ii)

  	
  The dollar amount of the
  Ceding Commission for such month,

  
	
   

  	
   

  	
   

  
	
   

  	
  (iii)

  	
  the dollar amount of the
  Reinsurer’s Quota Share Percentage of losses paid by the Reinsured during
  such month,

  
	
   

  	
   

  	
   

  
	
   

  	
  (iv)

  	
  the amount of any salvages, subrogation, and other
  recoveries received by the Reinsured during such month with respect to losses
  covered under the Policies, and

  
	
   

  	
   

  	
   

  
	
   

  	
  (v)

  	
  such policy detail as agreed by
  the parties.

  
	
   

  	
   

  
	
   

  	
  The Reinsured shall pay the Premium to the Reinsurer
  within fifteen (15) days of receipt of payment of insurance premium.

  
	
   

  	
   

  
	
  AMENDMENTS AND ASSIGNMENT:

  	
  This Agreement may not be assigned by either party
  without the prior written consent of the other party.  This Agreement may be amended

  

 

6

 

	
   

  	
  only by a written instrument executed by each
  of the parties.  Such duly executed
  amendments will be considered an integral part of this Agreement.

  
	
   

  	
   

  
	
  BOOKS AND
  RECORDS:

  	
  For as long as either
  party remains under any liability hereunder, the Reinsured shall, upon
  request by the Reinsurer, make available for inspection at any reasonable
  time by such representatives as may be authorised by the Reinsurer for that
  purpose, all information relating to business reinsured hereunder in the
  Reinsured’s possession or under its control or to which it has access under
  any agreement.

  
	
   

  	
   

  
	
  SET OFF:

  	
  Either party may at its
  discretion set off against any amounts due from the other party under this
  Agreement or any other agreements between the parties any amounts that are
  due and owing to the other party.

  
	
   

  	
   

  
	
  UNDERWRITING
  GUIDELINES:

  	
  The Reinsured agrees that
  it shall follow the underwriting guidelines set forth in Exhibit B (as
  amended from time to time) (the “Underwriting
  Guidelines”).  It is a
  condition precedent to the Reinsurer’s liability hereunder that the Reinsured
  shall not amend the Underwriting Guidelines or waive any provision thereof
  without the prior written approval of the Reinsurer

  
	
   

  	
   

  
	
  MANAGING GENERAL AGENTS:

  	
  The parties agree that the
  Reinsured shall not contract with any agent to underwrite or service claims
  on its behalf in respect of the Policies unless the Reinsurer shall have
  consented thereto in writing (any such agreement consented to by the
  Reinsurer, a “Managing General Agency
  Agreement”).  As of the
  effective date of this Agreement, the Reinsurer consents to the Reinsured
  contracting with Legal & Contingency Limited (the “Agent”) on a facultative basis to
  underwrite and service claims on behalf of the Reinsured until such time, if
  any, as an Underwriting Management Agreement is entered into between the
  Agent and the Reinsured (such Managing General Agency Agreement to be subject
  to the prior written consent of the Reinsurer).  Notwithstanding the foregoing, the
  Reinsured shall be solely liable for the performance and actions of any agent so contracted with.

  
	
   

  	
   

  
	
  ARBITRATION:

  	
  Any dispute, controversy,
  or claim arising out of or relating to this Policy, or the breach,
  termination or invalidity thereof, shall be finally settled by arbitration,
  in Bermuda under the provisions of the Bermuda Arbitration Act of 1986, as
  amended.

  
	
   

  	
   

  
	
   

  	
  Either party to the
  dispute, once a claim or demand on its part has been denied or remains
  unsatisfied for a
  period of twenty (20) calendar days by the other party, may notify the other
  party of its desire to arbitrate the matter in dispute and at the time of
  such notification the party desiring

  

 

7

 

	
   

  	
  arbitration shall notify the other party of the name
  of the Arbitrator nominated by it.  The
  other party who has  been so
  notified shall within fourteen calendar days thereafter nominate another
  Arbitrator and notify the party desiring arbitration of the name of such
  second Arbitrator.

  
	
   

  	
   

  
	
   

  	
  The two Arbitrators
  nominated by the parties shall within fourteen calendar days after
  appointment of the second Arbitrator choose a third Arbitrator.

  
	
   

  	
   

  
	
   

  	
  The Arbitrators shall fix,
  on giving a reasonable notice in writing to the parties involved, a time and
  place for the hearing in Bermuda and may prescribe procedural rules governing
  the course and conduct of the arbitration proceeding, including without
  limitation discovery by the parties. 
  The Arbitrators shall, within ninety calendar days following the
  conclusion of the hearing render their decision on the matter or matters in
  dispute in writing and shall cause  a
  copy thereof to be served on all parties thereto.  In case the Arbitrators fail to reach a
  unanimous decision, the decision of the majority of the Arbitrators shall be
  deemed to be the decision of the Arbitrators.

  
	
   

  	
   

  
	
   

  	
  Each party shall bear the
  expense of its own Arbitrator.  The
  remaining joint costs of the arbitration shall be borne equally by the
  parties to such arbitration.

  
	
   

  	
   

  
	
   

  	
  The decision of the
  Arbitrators shall be final and binding upon the parties and the parties
  hereby agree to exclude any right of appeal under Section 29 of the
  Arbitrators Act of 1986 against any award rendered by the Arbitrators and
  further agree to exclude any application under Section 30(1) of the
  Arbitration Act of 1986 for a determination of any question of law by the
  supreme court of Bermuda.

  
	
   

  	
   

  
	
   

  	
  All awards of the Board of
  Arbitration may be enforced in the same manner as a judgement or order from
  the Supreme Court of Bermuda and judgement may be entered pursuant to the
  terms of the award by leave from the Supreme Court of Bermuda.

  
	
   

  	
   

  
	
  GOVERNING
  LAW:

  	
  This Agreement shall be
  governed by the law of Bermuda and the parties hereby submit to the
  non-exclusive jurisdiction of the Courts of Bermuda.

  
	
   

  	
   

  
	
  THIRD
  PARTY RIGHTS:

  	
  Nothing herein shall be
  deemed to create any obligation or to establish any right against in favor of
  any third parties or persons not parties to this Agreement.

  
	
   

  	
   

  
	
  COUNTERPARTS:

  	
  This Agreement may be
  executed in any number of counterparts, and by different parties hereto in
  separate counterparts, each of
  which when so executed and delivered shall be an original, but all of which
  shall together constitute one and the same instrument.

  

 

8

 

	
  HEADINGS:

  	
   

  	
  The headings of the several sections and subsections
  of this Agreement are inserted for convenience only, and shall not in any way
  affect the meaning or construction of any provision of this Agreement.

  
	
   

  	
   

  	
   

  
	
  SEVERABILITY:

  	
   

  	
  To the extent that this Agreement may be in conflict
  with any applicable law or regulation, this Agreement shall be amended, at
  the mutual agreement of both the Reinsured and the Reinsurer, to the extent
  possible, to comply with such law and regulation.  If any term or provision of this Agreement
  shall be found by a court of competent jurisdiction to be illegal or
  otherwise unenforceable, the same shall not invalidate the whole of this
  Agreement, but such term or provision shall be deemed modified to the extent
  necessary in the court’s opinion to render such term or provision
  enforceable, and the rights and obligations of the parties shall be construed
  and enforced accordingly preserving to the fullest permissible extent the
  intent and agreements of the parties set forth herein.

  
	
   

  	
   

  	
   

  
	
  CURRENCY:

  	
   

  	
  All payments by either party to the other under this
  Agreement are in Pounds Sterling.

  
	
   

  	
   

  	
   

  
	
  BROKERAGE:

  	
   

  	
  There shall be no broker or intermediary for this
  Agreement.

  
	
   

  	
   

  	
   

  
	
  NOTICES:

  	
   

  	
  Any notice required or permitted hereunder shall be
  in writing and shall be delivered personally, sent by facsimile transmission,
  sent by prepaid air courier or sent by certified, registered or express mail,
  postage prepaid.  Any such notice shall
  be deemed delivered when received as follows:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  If to the Reinsurer:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  ACE Capital Re International Ltd.

  
	
   

  	
   

  	
   

  	
  The ACE Building, 5th Floor

  
	
   

  	
   

  	
   

  	
  30 Woodbourne Avenue

  
	
   

  	
   

  	
   

  	
  Hamilton HM08, Bermuda

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Mailing Address:

  
	
   

  	
   

  	
   

  	
  P.O. Box HM 1015

  
	
   

  	
   

  	
   

  	
  Hamilton HM DX,
  Bermuda

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Facsimile: 441-296-3379  

  
	
   

  	
   

  	
   

  	
  Telephone: 441-296-4004

  
	
   

  	
   

  	
   

  	
  Attn: General Counsel

  

 

9

 

	
   

  	
   

  	
  If to the Reinsured:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  ACE European Markets Insurance Limited (London
  Branch)

  
	
   

  	
   

  	
  100 Leadenhall Street

  
	
   

  	
   

  	
  London EC3A 3BP

  
	
   

  	
   

  	
  United Kingdom

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Attention: Carmel Carmagna

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  Facsimile:

  
	
   

  	
   

  	
   

  	
  Telephone : 011 44 207 173 7000

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Any party may by notice given in accordance with
  this Section to the other parties designate another address or person for
  receipt of notices hereunder.

  
	
   

  	
   

  	
   

  
	
  ACCOUNTS:

  	
   

  	
  All payments shall be made to the
  accounts of the applicable party as follows:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  To the Reinsured:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  To be provided

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  To the Reinsurer:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  HSBC Bank Plc

  
	
   

  	
   

  	
  PO Box 181

  
	
   

  	
   

  	
  27-32 Poultry

  
	
   

  	
   

  	
  London EC2P 2BX,
  UK

  
	
   

  	
   

  	
  Swift: MIDL GB22

  

 

IN
WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed and delivered by their duly authorized officers as of
the effective date hereof.

 

Issued and signed in duplicate in Bermuda.

 

	
  For and on behalf of the Reinsured:

  	
   

  	
  For and on behalf of the Reinsured:

  
	
   

  	
   

  	
   

  
	
  ACE EUROPEAN MARKETS INSURANCE
  LIMITED

  	
   

  	
  ACE CAPITAL RE INTERNATIONAL LTD.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  /s/ James C. Hooban

  	
   

  	
   

  	
  /s/ Robbin W. Conner

  	
   

  
	
  Name: James C. Hooban

  	
   

  	
  Name: Robbin Conner

  
	
  Title: Managing Director

  	
   

  	
  Title: Chief Operating Officer

  
	
  Date: August 15, 2002

  	
   

  	
  Date: August 15, 2002

  
					

 

10

 

EXHIBIT
A

 

FORM OF POLICY

 

11

 

EXHIBIT
B

 

UNDERWRITING GUIDELINES

 

12

 

SCHEDULE
A

 

CALCULATION OF PREMIUM
PERCENTAGE

 

The Premium Percentage is calculated as follows:

 

 

	
  (A)  Gross Premiums Written (net of
  cancellations & return premiums),

  	
   

  	
  100.00

  	
  %

  
	
   

  	
   

  	
   

  	
   

  
	
  (B)  minus,
  Underwriting Commission Payable to MGA {40% x (A)},

  	
   

  	
  (40.00

  	
  )%

  
	
   

  	
   

  	
   

  	
   

  
	
  (C)  minus
  Profit Sharing Premium Payable to MGA {7.5% x (A)},

  	
   

  	
  (7.50

  	
  )%

  
	
   

  	
   

  	
   

  	
   

  
	
  (D)  equals
  Risk Premium (A – B – C),

  	
   

  	
  52.50

  	
  %

  
	
   

  	
   

  	
   

  	
   

  
	
  (E)  minus Premium
  to Reinsured {10% x (D)},

  	
   

  	
  (5.25

  	
  )%

  
	
   

  	
   

  	
   

  	
   

  
	
  (F)  equals Net
  to Reinsurer before Ceding Commission {(D) – (E)},

  	
   

  	
  47.25

  	
  %

  
	
   

  	
   

  	
   

  	
   

  
	
  (G)  minus Ceding
  Commission to Reinsured {5% x (F)},

  	
   

  	
  - (2.3625

  	
  )%

  
	
   

  	
   

  	
   

  	
   

  
	
  (H)  equals Net
  to Reinsurer (or “Premium Percentage”)

  	
   

  	
  44.8875

  	
  %

  

 

13

 

SPECIAL
ACCEPTANCE

 

This Special Acceptance, effective as of August 15, 2002, is made in
respect of, and is subject to, the Quota Share Reinsurance Agreement between
ACE European Markets Insurance Limited (the “Reinsured”)
and ACE Capital Re International Ltd. (“Reinsurer”)
dated August 15, 2002 (the “Reinsurance
Agreement”).

 

WHEREAS, the
Reinsurance Agreement provides that “all contracts of title insurance issued or
entered into by the Reinsured during the Term which contracts are substantially
in the form of Exhibit A attached [t]hereto and underwritten by the Reinsured
substantially in accordance with the Underwriting Guidelines attached [t]hereto
as Exhibit B” shall be covered by the Reinsurer under the terms of the
Reinsurance Agreement;

 

WHEREAS, the
Reinsured desires to cede to the Reinsurer under and pursuant to the terms of
the Reinsurance Agreement certain policies which were entered into by the
Reinsured prior to inception of the Term of the Reinsurance Agreement;

 

NOW, THEREFORE, in consideration of the above stated
premises and for other good and valuable consideration, the sufficiency of
which are hereby mutually acknowledged, the Parties hereby agree as follows:

 

1.     The Reinsured hereby cedes to the Reinsurer the policies
attached hereto in Schedule B (the “Accepted
Policies”) for coverage under and pursuant to the terms of the
Reinsurance Agreement.

 

2.     The Reinsurer hereby accepts for coverage under the Reinsurance
Agreement the Accepted Policies and waives, in respect of such Accepted
Policies, the requirement that they have been issued or entered into by the
Reinsured during the Term.

 

All capitalized terms not otherwise defined herein shall have the
meaning ascribed thereto in the Reinsurance Agreement.

 

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

 

IN WITNESS WHEREOF, this
Special Acceptance has been executed by the following individuals duly
authorized to act on behalf of the parties on the dates set forth below:

 

 

	
  By and on behalf of:

  	
   

  	
  By and on behalf of:

  
	
   

  	
   

  	
   

  
	
  Ace European Markets Insurance Limited

  	
   

  	
  ACE Capital Re International Ltd.

  
	
   

  	
   

  	
   

  
	
  /s/ James C. Hooban

  	
   

  	
   

  	
   /s/ Robbin W. Conner

  	
   

  
	
  By: James C. Hooban

  	
   

  	
  By: Robbin Conner

  
	
  Title: Managing Director

  	
   

  	
  Title: Chief Operating Officer

  
	
  Date: August 15, 2002

  	
   

  	
  Date: August 15, 2002

  
					

 

 

SCHEDULE B

 

ACE European Markets

 

 

	
  ENQ #

  	
   

  	
  CNOTE REF

  	
   

  	
  NAME OF INSURED

  	
   

  	
  INCEPT

  	
   

  	
  LIMIT

  	
   

  	
  GWP

  	
   

  	
  TAX

  	
   

  	
  GROSS DUE

  	
   

  	
  BROKER

  	
   

  	
  NET DUE

  	
   

  	
  L&C

  	
   

  	
  ACE

  TOTAL PAID

  	
   

  	
  PREMIUM

  	
   

  	
  TAX

  	
   

  	
  ACE

  	
   

  
	
  13206

  	
   

  	
  9605348

  	
   

  	
  Prudential Assurance
  Company Limited

  	
   

  	
  9-Dec-00

  	
   

  	
  £

  	
  8,837,500

  	
   

  	
  £

  	
  44,187.50

  	
   

  	
  £

  	
  2,209.38

  	
   

  	
  £

  	
  46,396.88

  	
   

  	
  £

  	
  6,628.13

  	
   

  	
  £

  	
  39,768.75

  	
   

  	
  £

  	
  11,047.05

  	
   

  	
  £

  	
  28,721.70

  	
   

  	
  £

  	
  26,512.50

  	
   

  	
  £

  	
  2,209.38

  	
   

  	
  X

  	
   

  
	
  15179

  	
   

  	
  9605661

  	
   

  	
  Insolvency Act

  	
   

  	
  13-Dec-00

  	
   

  	
  £

  	
  6,000,000

  	
   

  	
  £

  	
  100,000.00

  	
   

  	
  £

  	
  5,000.00

  	
   

  	
  £

  	
  105,000.00

  	
   

  	
  £

  	
  15,000.00

  	
   

  	
  £

  	
  90,000.00

  	
   

  	
  £

  	
  25,000.40

  	
   

  	
  £

  	
  64,999.60

  	
   

  	
  £

  	
  60,000.00

  	
   

  	
  £

  	
  5,000.00

  	
   

  	
  X

  	
   

  
	
  16041

  	
   

  	
  9605914

  	
   

  	
  IM Properties Finance
  Limited and Tesco Stores Limited

  	
   

  	
  20-Feb-01

  	
   

  	
  £

  	
  25,837,500

  	
   

  	
  £

  	
  28,421.25

  	
   

  	
  £

  	
  1,421.06

  	
   

  	
  £

  	
  29,842.31

  	
   

  	
  £

  	
  0.00

  	
   

  	
  £

  	
  29,842.31

  	
   

  	
  £

  	
  11,366.61

  	
   

  	
  £

  	
  18,475.70

  	
   

  	
  £

  	
  17,052.75

  	
   

  	
  £

  	
  1,421.06

  	
   

  	
  X

  	
   

  
	
  15907

  	
   

  	
  9606029

  	
   

  	
  John Laing Property
  Business

  	
   

  	
  30-Apr-01

  	
   

  	
  £

  	
  14,400,000

  	
   

  	
  £

  	
  14,461.76

  	
   

  	
  £

  	
  723.09

  	
   

  	
  £

  	
  15,184.85

  	
   

  	
  £

  	
  0.00

  	
   

  	
  £

  	
  15,184.85

  	
   

  	
  £

  	
  5,784.70

  	
   

  	
  £

  	
  9,400.15

  	
   

  	
  £

  	
  8,677.06

  	
   

  	
  £

  	
  723.09

  	
   

  	
   

  	
   

  
	
  16381

  	
   

  	
  9606038

  	
   

  	
  The Secretary of State for
  Health

  	
   

  	
  26-Apr-01

  	
   

  	
  £

  	
  10,000,000

  	
   

  	
  £

  	
  100,000.00

  	
   

  	
  £

  	
  5,000.00

  	
   

  	
  £

  	
  105,000.00

  	
   

  	
  £

  	
  0.00

  	
   

  	
  £

  	
  105,000.00

  	
   

  	
  £

  	
  40,000.00

  	
   

  	
  £

  	
  65,000.00

  	
   

  	
  £

  	
  60,000.00

  	
   

  	
  £

  	
  5,000.00

  	
   

  	
   

  	
   

  
	
  10420

  	
   

  	
  9603801

  	
   

  	
  Stax Properties Limited

  	
   

  	
  9-Oct-96

  	
   

  	
  £

  	
  4,500,000

  	
   

  	
  £

  	
  4,000.00

  	
   

  	
  £

  	
  0.00

  	
   

  	
  £

  	
  4,000.00

  	
   

  	
  £

  	
  600.00

  	
   

  	
  £

  	
  3,400.00

  	
   

  	
  £

  	
  1,000.02

  	
   

  	
  £

  	
  2,399.98

  	
   

  	
  £

  	
  2,400.00

  	
   

  	
  £

  	
  0.00

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Totals

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  £

  	
  69,575,000

  	
   

  	
  £

  	
  291,071

  	
   

  	
  £

  	
  14,354

  	
   

  	
  £

  	
  305,424

  	
   

  	
  £

  	
  22,228

  	
   

  	
  £

  	
  283,196

  	
   

  	
  £

  	
  94,199

  	
   

  	
  £

  	
  188,997

  	
   

  	
  £

  	
  174,642

  	
   

  	
  £

  	
  14,354

  	
   

  	
   

  	
   

  

 

 

TERMINATION
AGREEMENT

 

This Termination Agreement,
dated as of May 31, 2003 (this “Agreement”), is made by and between ACE
European Markets Insurance Limited (“AEM”) and ACE Capital Re Overseas
Limited (“ACRO”).  Capitalized
terms used herein but not defined shall have the meanings ascribed to such
terms in the Reinsurance Agreement (as hereinafter defined).

 

RECITALS

 

WHEREAS, AEM and ACRO have
entered into that certain Quota Share Reinsurance Agreement (including the
Special Acceptance, effective as of August 15, 2002, made in respect of and subject
to such Quota Share Reinsurance Agreement), effective as of the 1st
day of January 2002 (the “Reinsurance Agreement”);

 

WHEREAS, pursuant to the
terms hereof, AEM and ACRO desire to terminate the Reinsurance Agreement;

 

NOW, THEREFORE, in consideration
of the mutual agreements set  forth
herein, the parties hereto agree as follows:

 

Section
1.               Termination.  Notwithstanding anything to the contrary in
the Reinsurance Agreement, AEM and ACRO hereby acknowledge and agree that,
effective the date hereof, the Reinsurance Agreement is hereby terminated.  Pursuant to the terms of the Reinsurance
Agreement, (i) Policies issued or renewed on or after the date hereof shall not
be ceded under the Reinsurance Agreement and (ii) the Reinsurance Agreement
shall remain in effect with respect to those Policies which are issued by AEM
prior to the date hereof until the earlier of their natural expiration,
termination, or renewal and AEM shall continue to account to ACRO for any
Premium, recoveries and other amounts payable in respect of such Policies.

 

Section
2.               Further
Assurances.  Each party hereto
shall, at any time and from time to time after the first date written above,
upon request of any other party hereto, do, execute, acknowledge and deliver,
or cause to be done, executed, acknowledged and delivered, all such further
acts, instruments, assignments and assurances as may be reasonably required in
order to carry out the intent of this Agreement.

 

Section
3.               Entire
Agreement.  This Agreement
contains the entire agreement and understanding of the parties hereto with
respect to the matters herein and supersedes any other agreement, whether
written or oral, with respect to the subject matter of this Agreement.

 

Section
4.               Counterparts.  This Agreement may be executed in any number
of counterparts, each of which will be deemed to be an original copy of this
Agreement and all of which, when taken together, will be deemed to constitute
one and the same agreement.

 

Section
5.               Governing
Law and Submission to Jurisdiction. 
This Agreement shall be governed by and construed in accordance with the
law of Bermuda and the parties hereto submit to the non-exclusive jurisdiction
of the Courts of Bermuda for the purpose of enforcing any claim arising
hereunder.

 

[The next page is the signature page.]

 

 

IN WITNESS
WHEREOF, the parties
hereto have caused this Agreement to be executed and delivered by their duly
authorized officers as of the effective date hereof.

 

 

	
  ACE
  EUROPEAN MARKETS

  INSURANCE LIMITED

  	
  ACE
  CAPITAL RE OVERSEAS LIMITED

  
	
   

  	
   

  
	
  /s/ James C. Hooban

  	
   

  	
   

  	
   

  
	
  Name:

  	
  James C. Hooban

  	
   

  	
  Name:

  	
   

  	
   

  
	
  Title:

  	
  Managing Director

  	
   

  	
  Title:

  	
   

  	
   

  
	
  Date:

  	
  December 18, 2003

  	
   

  	
  Date:

  	
   

  	
   

  

 

 

IN WITNESS WHEREOF, the
parties hereto have caused this Agreement to be executed and delivered by their
duly authorized officers as of the effective date hereof.

 

 

	
  ACE
  EUROPEAN MARKETS

  INSURANCE LIMITED

  	
  ACE
  CAPITAL RE OVERSEAS LIMITED

  
	
   

  	
   

  
	
   

  	
   

  	
  /s/ Rebecca L. Carne

  	
   

  
	
  Name:

  	
   

  	
   

  	
  Name:

  	
  Rebecca
  L. Carne

  	
   

  
	
  Title:

  	
   

  	
   

  	
  Title:

  	
  Director

  	
   

  
	
  Date:

  	
   

  	
   

  	
  Date:

  	
   

  	
   

  

 

 

EXECUTION
COPY

 

NOVATION AND AMENDMENT AGREEMENT

 

This Novation and Amendment Agreement, dated as of December 30, 2002
(the “Agreement”), is made by and between ACE Capital Re Overseas Ltd.
(“Overseas”), ACE Capital Re International Ltd. (“International”)
and ACE European Markets Insurance Limited (“AEMI”).  Capitalized terms used herein but not defined
shall have the meaning ascribed thereto in the Reinsurance Agreement (as
hereinafter defined).

 

RECITALS

 

WHEREAS, International and
AEMI have entered into that certain Quota Share Reinsurance Agreement
(including the Special Acceptance, effective as of August 15, 2002, made in
respect of and subject to the Reinsurance Agreement), dated as of January 1,
2002 (the “Reinsurance Agreement”);

 

WHEREAS, the parties hereto
desire to substitute Overseas for International as the “Reinsurer” under the
Reinsurance Agreement;

 

WHEREAS, AEMI desires to
consent to the novation set forth herein; and

 

WHEREAS,
subject to such novation, Overseas and AEMI desire to amend the Reinsurance
Agreement as provided herein.

 

NOW, THEREFORE, in
consideration of the mutual promises and covenants contained herein and for
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto hereby agree as follows:

 

1.     Effective as of January 1, 2002:

 

(i)                                     Overseas shall replace International for all
purposes under the Reinsurance Agreement as though it were the original
“Reinsurer;”

 

(ii)                                  Overseas shall assume all of the past,
present and future obligations of International which arise out of, relate to,
or are in any way connected with, the Reinsurance Agreement, whether known or
unknown, reported or unreported;

 

(iii)                               Overseas shall be substituted for
International, in International’s name, place and stead, as the “Reinsurer”
under the Reinsurance Agreement so as to effect a complete novation of the
Reinsurance Agreement from International to Overseas, and International shall
be simultaneously released from any and all liabilities or obligations
thereunder;

 

(iv)                              Overseas shall be entitled to all of the
past, present and future rights of International under the Reinsurance
Agreement, and shall be entitled to enforce all such rights in the name, place
and stead of International;

 

1

 

(v)                                 AEMI shall be entitled to and shall disregard
International as a party to the Reinsurance Agreement and shall be entitled to
and shall treat Overseas as if it had been originally obligated thereunder and
in respect of any liability or obligation thereunder;

 

(vi)                              AEMI hereby acknowledges and consents to the
novation referred to in this Section 1.

 

2.             In
furtherance of the foregoing, International and Overseas hereby agree that
International shall have no past, present or future liability or obligation
with respect to the Reinsurance Agreement, and Overseas hereby agrees to
indemnify and hold International harmless against any such liability or
obligation arising out of, related to, or in any way connected with the
Reinsurance Agreement.

 

3.             Subject
to the foregoing provisions, AEMI and Overseas agree to amend the Reinsurance
Agreement (effective as of January 1, 2002) as follows:

 

(i)    The phrase “ninety percent (90%)” appearing in the “REINSURING
AGREEMENT” section of the Reinsurance Agreement is deleted and replaced with
“one-hundred percent (100%).”

 

(ii)   The phrase “44.875%” appearing in the “PREMIUM” section of the
Reinsurance Agreement is deleted and replaced with “49.875%.”

 

(iii)  Schedule A of the Reinsurance Agreement is deleted in its entirety
and replaced with Annex A hereto.

 

(iv)  The notice information of the Reinsurer set
forth in the “NOTICES” section of the Reinsurance Agreement is deleted in its
entirety and replaced with the following:

 

ACE
Capital Re Overseas Ltd.

Victoria Hall

11 Victoria Street

Hamilton HM HX, Bermuda

Attention: Corporate
Secretary

Telephone: 441-297-9730

Facsimile: 441-297-9704

 

with a simultaneous copy to:

ACE Capital Re Inc.

1325 Avenue of the Americas

New York, NY 10019

Attention: General Counsel

Telephone: 212-974-0100

Facsimile: 212-581-3268

 

2

 

(v)   The account information of the Reinsurer set forth in the
“ACCOUNTS” section of the Reinsurance Agreement is deleted in its entirety and
replaced with the following:

 

Financial Institution: JP
Morgan/Chase

ABA No.: 021-000-021

Account No.: 910-2711-208

Account Name: ACE Capital Re
Overseas

 

(vi)  Reference to “ACE  Capital
Re International Ltd. (“Reinsurer”)” in the first paragraph of the Reinsurance
Agreement shall be deleted and replaced with “ACE Capital Re Overseas Ltd.
(“Reinsurer”).”

 

4.             Except
as expressly set forth herein and amended hereby, the Reinsurance Agreement
shall remain in full force and effect.

 

5.             This
Agreement shall be governed by and construed in accordance with the law of
Bermuda.  Any dispute, controversy, or
claim arising out of or relating to this Agreement, or the breach, termination,
or invalidity thereof, shall be governed by the “Arbitration” provisions of the
Reinsurance Agreement.

 

[The next page is the signature page.]

 

3

 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their duly authorized representatives on this 30th day of December
2002.

 

 

	
  ACE Capital
  Re Overseas Ltd.

  	
  ACE
  Capital Re International Ltd.

  
	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Rebecca L. Carne

  	
   

  	
  By:

  	
  /s/ Robbin W. Conner

  	
   

  
	
  Name:

  	
  Rebecca
  L. Carne

  	
   

  	
  Name:

  	
  Robbin Conner

  	
   

  
	
  Title:

  	
  Director

  	
   

  	
  Title:

  	
  COO

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ACE
  European Markets Insurance Limited

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ James C. Hooban

  	
   

  	
   

  	
   

  
	
  Name:

  	
   

  	
  JAMES C. HOOBAN

  	
   

  	
   

  	
   

  
	
  Title:

  	
   

  	
  MANAGING
  DIRECTOR

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
								

 

4

 

ANNEX A

 

SCHEDULE 1

 

CALCULATION
OF PREMIUM PERCENTAGE

 

The Premium Percentage is calculated as
follows:

 

	
  (A)  Gross Premiums Written (net of
  cancellations & return premiums),

  	
   

  	
  100.00

  	
  %

  
	
   

  	
   

  	
   

  	
   

  
	
  (B)  minus,
  Underwriting Commission Payable to MGA {40% x (A)},

  	
   

  	
  (40.00

  	
  )%

  
	
   

  	
   

  	
   

  	
   

  
	
  (C)  minus Profit
  Sharing Premium Payable to MGA {7.5% x (A)},

  	
   

  	
  (7.50

  	
  )%

  
	
   

  	
   

  	
   

  	
   

  
	
  (D)
  equals Risk Premium (A – B –
  C),

  	
   

  	
  52.50

  	
  %

  
	
   

  	
   

  	
   

  	
   

  
	
  (E) minus Ceding Commission to Reinsured {5%
  x (D)},

  	
   

  	
  (2.625

  	
  )%

  
	
   

  	
   

  	
   

  	
   

  
	
  (F) equals Net to Reinsurer (or “Premium
  Percentage”)

  	
   

  	
  49.875

  	
  %

  

 

5Exhibit 10.20

 

ASSIGNMENT AGREEMENT

 

This Assignment Agreement, dated as of April 15, 2004 (this “Agreement”),
is made by and between Assured Guaranty Re Overseas Ltd. (formerly known as ACE
Capital Re Overseas Ltd., formerly known as ACE Capital Re Bermuda Ltd.) (“AGRO”),
ACE Bermuda Insurance Ltd. (“ACE Bermuda”) and ACE Capital Title
Reinsurance Company (formerly known as Capital Title Reinsurance Company) (“ACE
Title”).

 

RECITALS

 

WHEREAS,
AGRO has executed and delivered that certain Amended and Restated Guaranty,
effective as of February 15, 2000 (the “Guaranty”), for the benefit
of ACE Title; and

 

WHEREAS,
AGRO desires to assign, transfer and novate all of its past, present and future
right, title, interest and obligations in, to and under the Guaranty to ACE
Bermuda as set forth in this Agreement; and

 

WHEREAS,
ACE Bermuda desires to accept all of the AGRO’s past, present and future right,
title, interest and obligations in, to and under the Guaranty as set forth in
this Agreement; and

 

WHEREAS,
ACE Title desires to consent to the assignment, transfer and novation referred
to above and to release AGRO from liability under the Guaranty.

 

NOW,
THEREFORE, in consideration of the mutual promises and covenants contained
herein and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto hereby agree
as follows:

 

1.                                       Effective
as of the date hereof:

 

(i)                                     AGRO hereby
assigns, transfers and novates all of its past, present and future right, title
and interest in the Guaranty to ACE Bermuda;

 

(ii)                                  AGRO hereby assigns,
transfers and novates all of its past, present and future obligations which
arise out of, relate to, or are in any way connected with, the Guaranty to ACE
Bermuda;

 

(iii)                               ACE Bermuda hereby
accepts each assignment, transfer and novation referred to in the immediately
preceding clauses (i) and (ii) and assumes all of the

 

 

liabilities and obligations (whether past, present or future) with
respect to the foregoing;

 

(iv)                              ACE Bermuda shall be the
“Parent” for all purposes under the Guaranty; and

 

(v)                                 ACE Title hereby
acknowledges and consents to each assignment, transfer and novation referred to
in clauses (i) and (ii) of this Paragraph 1.

 

2.                                       In furtherance
of the foregoing, (a) ACE Title hereby releases AGRO from any and all past,
present or future liability or obligation with respect to the Guaranty (b) ACE
Bermuda and AGRO acknowledge and agree that AGRO has no past, present or future
liability or obligation with respect to the Guaranty and (c) ACE Bermuda hereby
agrees to indemnify and hold AGRO harmless against any such liability or
obligation arising out of, related to, or in any way connected with the
Guaranty.

 

3.                                       Except
as expressly set forth herein and amended hereby, the Guaranty shall remain in
full force and effect.

 

4.                                       This
Agreement shall be governed by and construed in accordance with the laws of the
State of New York, without regard to the conflicts of law rules thereof.

 

5.                                       Each
of AGRO and ACE Bermuda shall, at its own cost and expense, execute and do all
such deeds, documents, acts and things as the other party may from time to time
reasonably request as may be necessary to give full effect to this Agreement.

 

6.                                       This
Agreement may be executed in any number of counterparts, each of which will be
deemed to be an original copy of this Agreement and all of which, when taken
together, will be deemed to constitute one and the same agreement.

 

[The next
page is the signature page.]

 

2

 

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

 

 

	
  ASSURED GUARANTY RE
  OVERSEAS LTD.

  
	
   

  
	
   

  
	
  By:

  	
  /s/ Norie R. Bregman

  	
   

  
	
  Name:   Norie R. Bregman

  
	
  Title:     EVP

  
	
   

  
	
   

  
	
  ACE BERMUDA
  INSURANCE LTD.

  
	
   

  
	
   

  
	
  By:

  	
  /s/ Andrew M. Gibbs

  	
   

  
	
  Name:   Andrew M. Gibbs

  
	
  Title:     CFO

  
	
   

  
	
   

  
	
  ACE CAPITAL TITLE
  REINSURANCE COMPANY

  
	
   

  
	
   

  
	
  By:

  	
  /s/ George D. Wilkinson

  	
   

  
	
  Name:   George D. Wilkinson

  
	
  Title:     Vice President
  & Counsel

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