Common use of Commutations Clause in Contracts

Commutations. Any portion of the proceeds of a commutation of any Inuring AXA RE Retrocession Agreements as relates to the Retrocessionaire’s participation in the Net Liability shall be added to the FW Canadian Account Balance, except to the extent the Retrocessionnaire shall have received a payment or participated in a credit or benefit under the Reserve Agreement in respect of such participation in the Net Liability; provided however that the proceeds in respect of a commutation of a multi-year Inuring AXA RE Retrocession Agreement which was in effect or otherwise covers any period prior to January 1, 2006 shall be allocated between the Retrocedant and the Retrocessionaire, in a mutually acceptable manner, such allocation to be based on the pro rata amount of aggregate loss reserves (and to the extent appropriate, paid Losses (as defined in the Reserve Agreement)) in respect of Policies in the Guaranteed Portfolio (as defined in the Reserve Agreement) and such other Policies, respectively, that are the subject of such commutation. The Retrocessionaire agrees that, following such a commutation, the Net Liability reinsured under this Agreement shall cease to be subject to reduction from retrocessional protection previously afforded by such commuted Inuring AXA RE Retrocession Agreement.

Commutations. Any portion of the proceeds of a commutation of any Inuring AXA RE Retrocession Agreements as relates to the Retrocessionaire’s participation in the Net Liability shall be added to the applicable FW Canadian Account Subaccount Balance, except to the extent the Retrocessionnaire shall have received a payment or participated in a credit or benefit under the Reserve Agreement in respect of such participation in the Net Liability; provided however that the proceeds in respect of a commutation of a multi-year Inuring AXA RE Retrocession Agreement which was in effect or otherwise covers any period prior to January 1, 2006 shall be allocated between the Retrocedant and the Retrocessionaire, in a mutually acceptable manner, such allocation to be based on the pro rata amount of aggregate loss reserves (and to the extent appropriate, paid Losses (as defined in the Reserve Agreement)) in respect of Policies in the Guaranteed Portfolio (as defined in the Reserve Agreement) and such other Policies, respectively, that are the subject of such commutation. The Retrocessionaire agrees that, following such a commutation, the Net Liability reinsured under this Agreement shall cease to be subject to reduction from retrocessional protection previously afforded by such commuted Inuring AXA RE Retrocession Agreement.