Common use of Contingency Fund Clause in Contracts

Contingency Fund. At Closing, CLIC and IFLAC shall transfer to LOTS or its designee cash or other assets acceptable to LOTS which have a market value on the Closing Date (as hereinafter defined) equal to 60% of the contingency fund (the Contingency Fund ) as computed in Exhibit F attached hereto. LOTS or its designee shall deposit such amount into a trust account (the Trust Account ) pursuant to a trust agreement with terms mutually acceptable to the Parties. The remaining 40% of the Contingency Fund shall be deposited by LOTS or its designee into the Trust Account over a three-year period which shall begin on the Effective Date. LOTS shall deposit into the Contingency Fund all amounts which are withheld from the New Business Fee payments otherwise due to Consumers, and as described in Section 2.3. CFC, its successor or assigns, may be entitled to receive all or a portion of the Contingency Fund, with interest thereon, as well as additional cash payments from LOTS or its designee based on the calculation of the claims ratio on the direct risk portion of the Inforce Business for the five-year period beginning October 1, 1997 and ending September 30, 2002, as further described in Exhibit F.