Common use of Triggering Event Clause in Contracts

Triggering Event. The Parties acknowledge and agree that, upon the occurrence of a Triggering Event, certain provisions of this Agreement and the Trust Agreement shall cease to be effective, and other provisions shall automatically be effective, so long as such Triggering Event continues, as described herein and in the Trust Agreement. Provisions that will automatically become modified upon the occurrence and during the continuation of a Triggering Event are as follows: (a) the valuation of Eligible Assets in the Trust Account under Section 4.2(b) and all other applicable sections of this Agreement shall be modified from Statutory Book Value to Fair Market Value, (b) Section 4.7(a) governing the use and application of assets in the Trust Account by the Ceding Company prior to a Triggering Event shall not apply, (c) Section 4.7(b) governing the use and application of assets in the Trust Account by the Ceding Company during the continuance of a Triggering Event shall apply, (d) Section 4.8(a)(i) governing the adjustment of the security held in the Trust Account prior to a Triggering Event shall not apply, and (e) Section 4.8(a)(ii) governing the adjustment of the security held in the Trust Account following a Triggering Event shall apply. Withdrawal of Assets from the Trust Account. So long as no Triggering Event has occurred and is continuing, the Ceding Company and the Reinsurer agree that the assets maintained in the Trust Account may be withdrawn by the Ceding Company or any successor by operation of law of the Ceding Company, including, without limitation, any liquidator, rehabilitator, receiver or conservator of the Ceding Company, without diminution because of any insolvency, rehabilitation, conservatorship or comparable proceeding (an “Insolvency”) on the part of the Ceding Company or the Reinsurer, only in accordance with the terms of the Trust Agreement, (i) in order to pay or reimburse the Ceding Company for any undisputed amounts due from the Reinsurer under this Agreement and not yet recovered from the Reinsurer, including any Reinsured Liabilities, Terminal Settlement, or other amounts due under this Agreement, which amounts have not been paid by the Reinsurer within ten (10) calendar days following the Reinsurer’s receipt of a specific written notice thereof, or (ii) otherwise with the prior written consent of the Reinsurer. During the continuation of a Triggering Event, the Ceding Company and the Reinsurer agree that the assets maintained in the Trust Account may be withdrawn by the Ceding Company, or any successors by operation of law of the Ceding Company, including without limitation any liquidator, rehabilitator, receiver or conservator of the Ceding Company, without diminution because of Insolvency on the part of the Ceding Company or the Reinsurer, at any time (notwithstanding any other provisions of this Agreement or the other Transaction Agreements) without notice or consent from the Reinsurer, but only for one or more of the following purposes: to pay or reimburse the Ceding Company for the Reinsurer’s share of premiums returned, but not yet recovered from the Reinsurer, to the Contractholders or Insureds of the Reinsured Contracts reinsured hereunder because of cancellations of the Reinsured Contracts or certificates issued thereunder; to pay or reimburse the Ceding Company for the Reinsurer’s share of surrenders and benefits or losses payable by the Ceding Company pursuant to the provisions of the Reinsured Contracts reinsured hereunder; to pay or reimburse the Ceding Company for any other amounts necessary to secure the credit or reduction from liability for reinsurance taken by the Ceding Company hereunder; and for any other purpose required under the credit for reinsurance regulations of the Ceding Company Domiciliary State in order to secure the credit or reduction from liability for reinsurance taken by the Ceding Company hereunder. The Ceding Company shall promptly return to the Trust Account assets withdrawn in excess of the actual amounts required for Section 4.7 (a) and (b) above, together with interest on such excess withdrawn amounts at the Interest Rate for the period that such assets are held by the Ceding Company. Until such excess amounts are so returned to the Trust Account, any such amounts shall at all times be held by the Ceding Company or its successors in interest by operation of law, including, without limitation, any liquidator, rehabilitator, receiver or conservator of the Ceding Company, in trust for the benefit of the Reinsurer and be maintained in a segregated account, separate and apart from any assets of the Ceding Company for the sole purpose of funding the reimbursements and payments described in Section 4.7(a) or (b), as applicable. Adjustment of Security and Withdrawals. The amount of security required to be provided by the Reinsurer hereunder shall be adjusted following the end of each calendar quarter ending after the Effective Time based on (i) the Required Balance as of the end of such calendar quarter calculated in good faith by the Reinsurer as Administrator and furnished to the Ceding Company in a report (or, following termination of the Administrative Services Agreement, calculated in good faith by the Ceding Company and furnished to the Reinsurer in a report) (the “Security Funding Report”) no later than ten (10) Business Days following the end of such calendar quarter (the “Security Funding Reporting Date”) and (ii) the Statutory Book Value or, following the occurrence and during the continuation of a Triggering Event, the Fair Market Value of the Eligible Assets held in the Trust Account as of the end of such calendar quarter as furnished by the Reinsurer to the Ceding Company in a report no later than the Security Funding Reporting Date. The amount of security required to be held in the Trust Account shall be adjusted as follows: So long as no Triggering Event has occurred and is continuing: If the aggregate Statutory Book Value of the Eligible Assets held in the Trust Account as of the end of any calendar quarter is less than the Required Balance, calculated based on the Security Funding Report for such calendar quarter, then the Reinsurer shall, no later than [REDACTED] calendar days following the Security Funding Reporting Date for such quarter, transfer additional Eligible Assets to the Trust Account so that the aggregate Statutory Book Value of the Eligible Assets held in the Trust Account is not less than the Required Balance; and If the aggregate Statutory Book Value of the Eligible Assets held in the Trust Account as of the end of any calendar quarter exceeds the Required Balance, calculated based on the Security Funding Report for such calendar quarter, then the Reinsurer shall have the right to withdraw such excess in accordance with the procedures set forth in the Trust Agreement. If the Reinsurer seeks to cause the Trustee to substitute new Eligible Assets for Eligible Assets held in the Trust Account, which new Eligible Assets have an aggregate Statutory Book Value at least equal to the aggregate Statutory Book Value of the substituted Eligible Assets held in the Trust Account immediately prior to such substitution and the aggregate Fair Market Value of such new Eligible Assets is at least equal to the lesser of (A) the aggregate Statutory Book Value of such new Eligible Assets and (B) the aggregate Fair Market Value of the substituted Eligible Assets, then the Reinsurer shall have the right to cause (and shall only cause) the Trustee to effect such substitution in accordance with the procedures set forth in the Trust Agreement. During the continuation of a Triggering Event: If the aggregate Fair Market Value of the Eligible Assets held in the Trust Account as of the end of any calendar quarter is less than the Required Balance, calculated based on the Security Funding Report for such calendar quarter, then the Reinsurer shall, no later than three (3) Business Days following the Security Funding Reporting Date for such calendar quarter, transfer additional Eligible Assets to the Trust Account so that the aggregate Fair Market Value of the Eligible Assets held in the Trust Account is not less than the Required Balance; and If the aggregate Fair Market Value of the Eligible Assets held in the Trust Account as of the end of any calendar quarter (x) if no RBC Event is continuing, exceeds [REDACTED] of, and (y) if an RBC Event is continuing, exceeds one hundred percent (100%) of, the Required Balance, calculated based on the Security Funding Report for such calendar quarter, then the Reinsurer shall have the right to seek consent from the Ceding Company to withdraw such excess in accordance with the procedures set forth in the Trust Agreement, which consent shall be provided by the Ceding Company as promptly as reasonably practicable. If the Reinsurer seeks to cause the Trustee to substitute new Eligible Assets for Eligible Assets held in the Trust Account, which new Eligible Assets have an aggregate Fair Market Value at least equal to the aggregate Fair Market Value of the substituted Eligible Assets held in the Trust Account immediately prior to such substitution, then the Reinsurer shall have the right to cause the Trustee to effect such substitution with the prior written consent of the Ceding Company, which consent the Ceding Company shall deliver as promptly as reasonably practicable following the Ceding Company’s confirmation of the aggregate Fair Market Values of the Eligible Assets to be substituted and being replaced. In addition, as soon as reasonably practicable, and no later than (i) [REDACTED] calendar days after the Reinsurer becomes aware of the occurrence of a Triggering Event (other than a Reserve Credit Event) and (ii) the earlier of (x) [REDACTED] calendar days after the Reinsurer becomes aware of the occurrence of a Reserve Credit Event and (y) the fiscal quarter- or fiscal year-end following the date on which the Reinsurer becomes aware of the occurrence of the Reserve Credit Event, (in each case of (i) and (ii), unless the Ceding Company shall agree to a longer period, then by the end of such longer period), the Reinsurer shall (i) substitute any assets in the Trust Account that are not Eligible Assets for assets that are Eligible Assets, and (ii) deposit additional assets consisting of Eligible Assets in the Trust Account sufficient to ensure that the aggregate Fair Market Value of the Eligible Assets in the Trust Account is not less than the Required Balance as of the last day of the immediately preceding calendar quarter. The report required to be delivered by the Reinsurer as described in Section 4.8(a) shall include a listing of each asset in the Trust Account and the Statutory Book Value or, following the occurrence and during the continuance of a Triggering Event, the Fair Market Value, of each such asset as of the end of the relevant calendar quarter. In addition, no later than [REDACTED] calendar days following the end of each calendar quarter, the Reinsurer shall provide to the Ceding Company a report indicating if any of the assets in the Security Funding Report for such calendar quarter are not an Eligible Asset and including reasonable and customary backup material demonstrating that the assets in Trust Account, together with the assets in the Protective Life and Annuity Trust Account, are in compliance with the investment guidelines set forth on Schedule C. In the event that the Ceding Company disagrees with the calculation of the Fair Market Value or the Statutory Book Value, as applicable, of any Eligible Asset or whether any asset is an Eligible Asset as set forth in any such report, the Ceding Company may deliver written notice to the Reinsurer of such disagreement and the Parties shall attempt in good faith to resolve such disagreement. Any resolution agreed to in writing by the Parties shall be final and binding upon the Parties. If the Parties are unable to resolve any disagreement as to the calculation of the Fair Market Value or the Statutory Book Value, as applicable, of any Eligible Asset or whether any asset is an Eligible Asset within [REDACTED] Business Days after the Ceding Company delivers written notice of any such disagreement to the Reinsurer, the Parties shall jointly request the Independent Accountant to determine the Fair Market Value or the Statutory Book Value, as applicable, of the disputed Eligible Asset or whether the disputed asset is an Eligible Asset as of the relevant date in accordance with the procedures set forth in Section 2.12 of the Master Transaction Agreement, mutatis mutandis. The Independent Accountant’s determination of the Fair Market Value or the Statutory Book Value, as applicable, of the disputed Eligible Asset or whether the disputed asset is an Eligible Asset shall be final and binding upon the Parties. The fees, costs and expenses associated with the Independent Accountant’s determination shall be allocated between the Ceding Company and the Reinsurer in accordance with the Independent Accountant’s judgment as to the relative merits of the Parties’ proposals in respect of the dispute. After a final and binding resolution of any dispute described in this Section 4.8(c) is reached, the Parties agree to make any necessary adjustments under Section 4.8(a) so that the aggregate Fair Market Value or the Statutory Book Value, as applicable, of the Eligible Assets held in the Trust Account is not less than the amount required pursuant to Section 4.8(a)(i) or (a)(ii), as applicable.

Triggering Event. The Parties acknowledge and agree that, upon Upon the occurrence of a Triggering Event, certain provisions until the Borrower has prepaid the Loans in an aggregate principal amount of this Agreement and at least $250,000,000, the Trust Agreement Borrower shall cease to be effective, and other provisions shall automatically be effective, so long as such Triggering Event continues, as described herein and in the Trust Agreement. Provisions that will automatically become modified upon the occurrence and during the continuation of a Triggering Event are as follows: use commercially reasonable efforts to: (a) Within 30 days after the valuation end of Eligible Assets the Replacement Period (or such later date as approved by the Required Lenders in their sole and absolute discretion), form a special committee of the Trust Account under Section 4.2(b) board of directors of the Borrower (the “Special Committee”), comprised of one or more independent directors reasonably acceptable to the Required Lenders (such approval not to be unreasonably withheld, conditioned or delayed), empowered and all authorized to negotiate and consummate a sale, transfer or other applicable sections of this Agreement shall be modified from Statutory Book Value monetization event with respect to Fair Market Valuethe Target Non-Core Assets, in each case, pursuant to documentation reasonably satisfactory to the Required Lenders (the “Special Committee Milestone”); (b) Section 4.7(a) governing Within 60 days after the use and application end of assets in the Trust Account Replacement Period (or such later date as approved by the Ceding Company prior Required Lenders in their sole and absolute discretion), engage advisors and/or consultants (either new or existing with an expanded mandate in each case, reasonably acceptable to a Triggering Event shall the Required Lenders (such approval not applyto be unreasonably withheld, conditioned or delayed)) to explore value maximization across each of the Target Non-Core Assets (the “Advisor/Consultant Milestone”); and (c) Section 4.7(b) governing Within 120 days after the use and application end of assets in the Trust Account Replacement Period (or such later date as approved by the Ceding Company during Required Lenders in their sole and absolute discretion), the continuance Special Committee shall have prepared and delivered a presentation to the board of a Triggering Event shall apply, (d) Section 4.8(a)(i) governing the adjustment directors of the security held in Borrower with respect to the Trust Account options for value maximization with respect to the Target Non-Core Assets (the “Presentation Milestone”, and together with the Special Committee Milestone and the Advisor/Consultant Milestone, collectively, the “Milestones” and each individually, a “Milestone”); provided, that if the Borrower has already satisfied a given Milestone prior to a Triggering Event shall not apply, and (e) Section 4.8(a)(ii) governing the adjustment of the security held in the Trust Account following a Triggering Event shall apply. Withdrawal of Assets from the Trust Account. So long as no Triggering Event has occurred and is continuing, the Ceding Company and the Reinsurer agree that the assets maintained in the Trust Account may be withdrawn by the Ceding Company or any successor by operation of law of the Ceding Company, including, without limitation, any liquidator, rehabilitator, receiver or conservator of the Ceding Company, without diminution because of any insolvency, rehabilitation, conservatorship or comparable proceeding (an “Insolvency”) on the part of the Ceding Company or the Reinsurer, only in accordance with the terms of the Trust Agreement, (i) in order to pay or reimburse the Ceding Company for any undisputed amounts due from the Reinsurer under this Agreement and not yet recovered from the Reinsurer, including any Reinsured Liabilities, Terminal Settlement, or other amounts due under this Agreement, which amounts have not been paid by the Reinsurer within ten (10) calendar days following the Reinsurer’s receipt of a specific written notice thereof, or (ii) otherwise with the prior written consent of the Reinsurer. During the continuation occurrence of a Triggering Event, the Ceding Company and the Reinsurer agree that the assets maintained in the Trust Account may then such Milestone need not be withdrawn by the Ceding Company, or any successors by operation of law of the Ceding Company, including without limitation any liquidator, rehabilitator, receiver or conservator of the Ceding Company, without diminution because of Insolvency on the part of the Ceding Company or the Reinsurer, at any time (notwithstanding any other provisions of this Agreement or the other Transaction Agreements) without notice or consent from the Reinsurer, but only for one or more of the following purposes: to pay or reimburse the Ceding Company for the Reinsurer’s share of premiums returned, but not yet recovered from the Reinsurer, to the Contractholders or Insureds of the Reinsured Contracts reinsured hereunder because of cancellations of the Reinsured Contracts or certificates issued thereunder; to pay or reimburse the Ceding Company for the Reinsurer’s share of surrenders and benefits or losses payable by the Ceding Company pursuant to the provisions of the Reinsured Contracts reinsured hereunder; to pay or reimburse the Ceding Company for any other amounts necessary to secure the credit or reduction from liability for reinsurance taken by the Ceding Company hereunder; and for any other purpose required under the credit for reinsurance regulations of the Ceding Company Domiciliary State in order to secure the credit or reduction from liability for reinsurance taken by the Ceding Company hereunder. The Ceding Company shall promptly return to the Trust Account assets withdrawn in excess of the actual amounts required for Section 4.7 (a) and (b) above, together with interest on such excess withdrawn amounts at the Interest Rate for the period that such assets are held by the Ceding Company. Until such excess amounts are so returned to the Trust Account, any such amounts shall at all times be held by the Ceding Company or its successors in interest by operation of law, including, without limitation, any liquidator, rehabilitator, receiver or conservator of the Ceding Company, in trust for the benefit of the Reinsurer and be maintained in a segregated account, separate and apart from any assets of the Ceding Company for the sole purpose of funding the reimbursements and payments described in Section 4.7(a) or (b), as applicable. Adjustment of Security and Withdrawals. The amount of security required to be provided by the Reinsurer hereunder shall be adjusted following the end of each calendar quarter ending satisfied again after the Effective Time based on (i) the Required Balance as of the end of such calendar quarter calculated in good faith by the Reinsurer as Administrator and furnished to the Ceding Company in a report (or, following termination of the Administrative Services Agreement, calculated in good faith by the Ceding Company and furnished to the Reinsurer in a report) (the “Security Funding Report”) no later than ten (10) Business Days following the end of such calendar quarter (the “Security Funding Reporting Date”) and (ii) the Statutory Book Value or, following the occurrence and during the continuation of a Triggering Event, the Fair Market Value of the Eligible Assets held in the Trust Account as of the end of such calendar quarter as furnished by the Reinsurer to the Ceding Company in a report no later than the Security Funding Reporting Date. The amount of security required to be held in the Trust Account shall be adjusted as follows: So long as no Triggering Event has occurred and is continuing: If the aggregate Statutory Book Value of the Eligible Assets held in the Trust Account as of the end of any calendar quarter is less than the Required Balance, calculated based on the Security Funding Report for such calendar quarter, then the Reinsurer shall, no later than [REDACTED] calendar days following the Security Funding Reporting Date for such quarter, transfer additional Eligible Assets to the Trust Account so that the aggregate Statutory Book Value of the Eligible Assets held in the Trust Account is not less than the Required Balance; and If the aggregate Statutory Book Value of the Eligible Assets held in the Trust Account as of the end of any calendar quarter exceeds the Required Balance, calculated based on the Security Funding Report for such calendar quarter, then the Reinsurer shall have the right to withdraw such excess in accordance with the procedures set forth in the Trust Agreement. If the Reinsurer seeks to cause the Trustee to substitute new Eligible Assets for Eligible Assets held in the Trust Account, which new Eligible Assets have an aggregate Statutory Book Value at least equal to the aggregate Statutory Book Value of the substituted Eligible Assets held in the Trust Account immediately prior to such substitution and the aggregate Fair Market Value of such new Eligible Assets is at least equal to the lesser of (A) the aggregate Statutory Book Value of such new Eligible Assets and (B) the aggregate Fair Market Value of the substituted Eligible Assets, then the Reinsurer shall have the right to cause (and shall only cause) the Trustee to effect such substitution in accordance with the procedures set forth in the Trust Agreement. During the continuation of a Triggering Event: If the aggregate Fair Market Value of the Eligible Assets held in the Trust Account as of the end of any calendar quarter is less than the Required Balance, calculated based on the Security Funding Report for such calendar quarter, then the Reinsurer shall, no later than three (3) Business Days following the Security Funding Reporting Date for such calendar quarter, transfer additional Eligible Assets to the Trust Account so that the aggregate Fair Market Value of the Eligible Assets held in the Trust Account is not less than the Required Balance; and If the aggregate Fair Market Value of the Eligible Assets held in the Trust Account as of the end of any calendar quarter (x) if no RBC Event is continuing, exceeds [REDACTED] of, and (y) if an RBC Event is continuing, exceeds one hundred percent (100%) of, the Required Balance, calculated based on the Security Funding Report for such calendar quarter, then the Reinsurer shall have the right to seek consent from the Ceding Company to withdraw such excess in accordance with the procedures set forth in the Trust Agreement, which consent shall be provided by the Ceding Company as promptly as reasonably practicable. If the Reinsurer seeks to cause the Trustee to substitute new Eligible Assets for Eligible Assets held in the Trust Account, which new Eligible Assets have an aggregate Fair Market Value at least equal to the aggregate Fair Market Value of the substituted Eligible Assets held in the Trust Account immediately prior to such substitution, then the Reinsurer shall have the right to cause the Trustee to effect such substitution with the prior written consent of the Ceding Company, which consent the Ceding Company shall deliver as promptly as reasonably practicable following the Ceding Company’s confirmation of the aggregate Fair Market Values of the Eligible Assets to be substituted and being replaced. In addition, as soon as reasonably practicable, and no later than (i) [REDACTED] calendar days after the Reinsurer becomes aware of the occurrence of a Triggering Event (other than a Reserve Credit Event) and (ii) the earlier of (x) [REDACTED] calendar days after the Reinsurer becomes aware of the occurrence of a Reserve Credit Event and (y) the fiscal quarter- or fiscal year-end following the date on which the Reinsurer becomes aware of the occurrence of the Reserve Credit Event, (in each case of (i) and (ii), unless the Ceding Company shall agree to a longer period, then by the end of such longer period), the Reinsurer shall (i) substitute any assets in the Trust Account that are not Eligible Assets for assets that are Eligible Assets, and (ii) deposit additional assets consisting of Eligible Assets in the Trust Account sufficient to ensure that the aggregate Fair Market Value of the Eligible Assets in the Trust Account is not less than the Required Balance as of the last day of the immediately preceding calendar quarter. The report required to be delivered by the Reinsurer as described in Section 4.8(a) shall include a listing of each asset in the Trust Account and the Statutory Book Value or, following the occurrence and during the continuance of a Triggering Event, the Fair Market Value, of each such asset as of the end of the relevant calendar quarter. In addition, no later than [REDACTED] calendar days following the end of each calendar quarter, the Reinsurer shall provide to the Ceding Company a report indicating if any of the assets in the Security Funding Report for such calendar quarter are not an Eligible Asset and including reasonable and customary backup material demonstrating that the assets in Trust Account, together with the assets in the Protective Life and Annuity Trust Account, are in compliance with the investment guidelines set forth on Schedule C. In the event that the Ceding Company disagrees with the calculation of the Fair Market Value or the Statutory Book Value, as applicable, of any Eligible Asset or whether any asset is an Eligible Asset as set forth in any such report, the Ceding Company may deliver written notice to the Reinsurer of such disagreement and the Parties shall attempt in good faith to resolve such disagreement. Any resolution agreed to in writing by the Parties shall be final and binding upon the Parties. If the Parties are unable to resolve any disagreement as to the calculation of the Fair Market Value or the Statutory Book Value, as applicable, of any Eligible Asset or whether any asset is an Eligible Asset within [REDACTED] Business Days after the Ceding Company delivers written notice of any such disagreement to the Reinsurer, the Parties shall jointly request the Independent Accountant to determine the Fair Market Value or the Statutory Book Value, as applicable, of the disputed Eligible Asset or whether the disputed asset is an Eligible Asset as of the relevant date in accordance with the procedures set forth in Section 2.12 of the Master Transaction Agreement, mutatis mutandis. The Independent Accountant’s determination of the Fair Market Value or the Statutory Book Value, as applicable, of the disputed Eligible Asset or whether the disputed asset is an Eligible Asset shall be final and binding upon the Parties. The fees, costs and expenses associated with the Independent Accountant’s determination shall be allocated between the Ceding Company and the Reinsurer in accordance with the Independent Accountant’s judgment as to the relative merits of the Parties’ proposals in respect of the dispute. After a final and binding resolution of any dispute described in this Section 4.8(c) is reached, the Parties agree to make any necessary adjustments under Section 4.8(a) so that the aggregate Fair Market Value or the Statutory Book Value, as applicable, of the Eligible Assets held in the Trust Account is not less than the amount required pursuant to Section 4.8(a)(i) or (a)(ii), as applicable.

Triggering Event. The Parties acknowledge and agree thatUpon, upon the occurrence of a Triggering Event, certain provisions of this Agreement and the Trust Agreement shall cease to be effective, and other provisions shall automatically be effective, so long as such Triggering Event continues, as described herein and in the Trust Agreement. Provisions that will automatically become modified upon the occurrence and during the continuation of a Triggering Event are as follows: (a) the valuation of Eligible Assets in the Trust Account under Section 4.2(b) and all other applicable sections of this Agreement shall be modified from Statutory Book Value to Fair Market Value, (b) Section 4.7(a) governing the use and application of assets in the Trust Account by the Ceding Company prior to a Triggering Event shall not apply, or within five (c) Section 4.7(b) governing the use and application of assets in the Trust Account by the Ceding Company during the continuance of a Triggering Event shall apply, (d) Section 4.8(a)(i) governing the adjustment of the security held in the Trust Account prior to a Triggering Event shall not apply, and (e) Section 4.8(a)(ii) governing the adjustment of the security held in the Trust Account following a Triggering Event shall apply. Withdrawal of Assets from the Trust Account. So long as no Triggering Event has occurred and is continuing, the Ceding Company and the Reinsurer agree that the assets maintained in the Trust Account may be withdrawn by the Ceding Company or any successor by operation of law of the Ceding Company, including, without limitation, any liquidator, rehabilitator, receiver or conservator of the Ceding Company, without diminution because of any insolvency, rehabilitation, conservatorship or comparable proceeding (an “Insolvency”) on the part of the Ceding Company or the Reinsurer, only in accordance with the terms of the Trust Agreement, (i) in order to pay or reimburse the Ceding Company for any undisputed amounts due from the Reinsurer under this Agreement and not yet recovered from the Reinsurer, including any Reinsured Liabilities, Terminal Settlement, or other amounts due under this Agreement, which amounts have not been paid by the Reinsurer within ten (10) calendar days following the Reinsurer’s receipt of a specific written notice thereof, or (ii) otherwise with the prior written consent of the Reinsurer. During the continuation of a Triggering Event, the Ceding Company and the Reinsurer agree that the assets maintained in the Trust Account may be withdrawn by the Ceding Company, or any successors by operation of law of the Ceding Company, including without limitation any liquidator, rehabilitator, receiver or conservator of the Ceding Company, without diminution because of Insolvency on the part of the Ceding Company or the Reinsurer, at any time (notwithstanding any other provisions of this Agreement or the other Transaction Agreements) without notice or consent from the Reinsurer, but only for one or more of the following purposes: to pay or reimburse the Ceding Company for the Reinsurer’s share of premiums returned, but not yet recovered from the Reinsurer, to the Contractholders or Insureds of the Reinsured Contracts reinsured hereunder because of cancellations of the Reinsured Contracts or certificates issued thereunder; to pay or reimburse the Ceding Company for the Reinsurer’s share of surrenders and benefits or losses payable by the Ceding Company pursuant to the provisions of the Reinsured Contracts reinsured hereunder; to pay or reimburse the Ceding Company for any other amounts necessary to secure the credit or reduction from liability for reinsurance taken by the Ceding Company hereunder; and for any other purpose required under the credit for reinsurance regulations of the Ceding Company Domiciliary State in order to secure the credit or reduction from liability for reinsurance taken by the Ceding Company hereunder. The Ceding Company shall promptly return to the Trust Account assets withdrawn in excess of the actual amounts required for Section 4.7 (a) and (b) above, together with interest on such excess withdrawn amounts at the Interest Rate for the period that such assets are held by the Ceding Company. Until such excess amounts are so returned to the Trust Account, any such amounts shall at all times be held by the Ceding Company or its successors in interest by operation of law, including, without limitation, any liquidator, rehabilitator, receiver or conservator of the Ceding Company, in trust for the benefit of the Reinsurer and be maintained in a segregated account, separate and apart from any assets of the Ceding Company for the sole purpose of funding the reimbursements and payments described in Section 4.7(a) or (b), as applicable. Adjustment of Security and Withdrawals. The amount of security required to be provided by the Reinsurer hereunder shall be adjusted following the end of each calendar quarter ending after the Effective Time based on (i) the Required Balance as of the end of such calendar quarter calculated in good faith by the Reinsurer as Administrator and furnished to the Ceding Company in a report (or, following termination of the Administrative Services Agreement, calculated in good faith by the Ceding Company and furnished to the Reinsurer in a report) (the “Security Funding Report”) no later than ten (105) Business Days following the end of such calendar quarter (the “Security Funding Reporting Date”) and (ii) the Statutory Book Value or, following the occurrence and during the continuation of a Triggering Event, the Fair Market Value of the Eligible Assets held in the Trust Account as of the end of such calendar quarter as furnished by the Reinsurer to the Ceding Company in a report no later than the Security Funding Reporting Date. The amount of security required to be held in the Trust Account shall be adjusted as follows: So long as no Triggering Event has occurred and is continuing: If the aggregate Statutory Book Value of the Eligible Assets held in the Trust Account as of the end of any calendar quarter is less than the Required Balance, calculated based on the Security Funding Report for such calendar quarter, then the Reinsurer shall, no later than [REDACTED] calendar days following the Security Funding Reporting Date for such quarter, transfer additional Eligible Assets to the Trust Account so that the aggregate Statutory Book Value of the Eligible Assets held in the Trust Account is not less than the Required Balance; and If the aggregate Statutory Book Value of the Eligible Assets held in the Trust Account as of the end of any calendar quarter exceeds the Required Balance, calculated based on the Security Funding Report for such calendar quarter, then the Reinsurer shall have the right to withdraw such excess in accordance with the procedures set forth in the Trust Agreement. If the Reinsurer seeks to cause the Trustee to substitute new Eligible Assets for Eligible Assets held in the Trust Account, which new Eligible Assets have an aggregate Statutory Book Value at least equal to the aggregate Statutory Book Value of the substituted Eligible Assets held in the Trust Account immediately prior to such substitution and the aggregate Fair Market Value of such new Eligible Assets is at least equal to the lesser of (A) the aggregate Statutory Book Value of such new Eligible Assets and (B) the aggregate Fair Market Value of the substituted Eligible Assets, then the Reinsurer shall have the right to cause (and shall only cause) the Trustee to effect such substitution in accordance with the procedures set forth in the Trust Agreement. During the continuation of a Triggering Event: If the aggregate Fair Market Value of the Eligible Assets held in the Trust Account as of the end of any calendar quarter is less than the Required Balance, calculated based on the Security Funding Report for such calendar quarter, then the Reinsurer shall, no later than three (3) Business Days following the Security Funding Reporting Date for such calendar quarter, transfer additional Eligible Assets to the Trust Account so that the aggregate Fair Market Value of the Eligible Assets held in the Trust Account is not less than the Required Balance; and If the aggregate Fair Market Value of the Eligible Assets held in the Trust Account as of the end of any calendar quarter (x) if no RBC Event is continuing, exceeds [REDACTED] of, and (y) if an RBC Event is continuing, exceeds one hundred percent (100%) of, the Required Balance, calculated based on the Security Funding Report for such calendar quarter, then the Reinsurer shall have the right to seek consent from the Ceding Company to withdraw such excess in accordance with the procedures set forth in the Trust Agreement, which consent shall be provided by the Ceding Company as promptly as reasonably practicable. If the Reinsurer seeks to cause the Trustee to substitute new Eligible Assets for Eligible Assets held in the Trust Account, which new Eligible Assets have an aggregate Fair Market Value at least equal to the aggregate Fair Market Value of the substituted Eligible Assets held in the Trust Account immediately prior to such substitution, then the Reinsurer shall have the right to cause the Trustee to effect such substitution with the prior written consent of the Ceding Company, which consent the Ceding Company shall deliver as promptly as reasonably practicable following the Ceding Company’s confirmation of the aggregate Fair Market Values of the Eligible Assets to be substituted and being replaced. In addition, as soon as reasonably practicable, and no later than (i) [REDACTED] calendar days after the Reinsurer becomes aware of the occurrence of a Triggering Event (other than that results in or is expected to result in any Available Cash, BBU shall provide written notice to BAM that includes a Reserve Credit Event) and (ii) the earlier of (x) [REDACTED] calendar days after the Reinsurer becomes aware description of the occurrence of a Reserve Credit Triggering Event and (y) the fiscal quarter- or fiscal year-end following the date on which the Reinsurer becomes aware of the occurrence of the Reserve Credit Event, (in each case of (i) Available Cash that has been actually received and (ii), unless the Ceding Company shall agree to a longer period, then by the end of such longer period), the Reinsurer shall (i) substitute any assets in the Trust Account that are not Eligible Assets for assets that are Eligible Assets, and (ii) deposit additional assets consisting of Eligible Assets in the Trust Account sufficient to ensure that the aggregate Fair Market Value of the Eligible Assets in the Trust Account is not less than the Required Balance as of the last day of the immediately preceding calendar quarter. The report required reasonably expected to be delivered by received in respect thereof (a “Triggering Event Notice”). BAM shall have the Reinsurer as described in Section 4.8(aright, within five (5) shall include a listing Business Days of each asset in the Trust Account and the Statutory Book Value or, following the occurrence and during the continuance receipt of a Triggering EventEvent Notice, the Fair Market Value, of each such asset as of the end of the relevant calendar quarter. In addition, no later than [REDACTED] calendar days following the end of each calendar quarter, the Reinsurer shall to provide to the Ceding Company a report indicating if any of the assets in the Security Funding Report for such calendar quarter are not an Eligible Asset and including reasonable and customary backup material demonstrating that the assets in Trust Account, together with the assets in the Protective Life and Annuity Trust Account, are in compliance with the investment guidelines set forth on Schedule C. In the event that the Ceding Company disagrees with the calculation of the Fair Market Value or the Statutory Book Value, as applicable, of any Eligible Asset or whether any asset is an Eligible Asset as set forth in any such report, the Ceding Company may deliver written notice to BBU (a “Redemption Notice”) specifying the Reinsurer aggregate Redemption Price of Preferred Securities issued pursuant to this Commitment Letter to be redeemed (the “Aggregate Redemption Amount”), provided that the Aggregate Redemption Amount shall not exceed the Available Cash resulting from such Triggering Event. Upon receipt of a Redemption Notice in accordance with this Section 8 and after the BBU Group actually receives all or any part of the Available Cash from such Triggering Event in respect of which a Redemption Notice was issued, BBU shall cause one or more BBU Subsidiary Issuers selected by BBU to redeem such number of Preferred Securities issued pursuant to this Commitment Letter with an aggregate Redemption Price equal to the Aggregate Redemption Amount as soon as practicable (and which redemptions, for greater certainty, may be completed in separate transactions as necessary as and when the corresponding Available Cash from such Triggering Event are actually received by the BBU Group); provided, however, that if at the time of redemption there are any BBU Subsidiary Issuers with Preferred Securities issued pursuant to this Commitment Agreement and outstanding that exceed 65% of the Common Equity of such disagreement and the Parties BBU Subsidiary Issuers (“Excess Preferred Securities”), BBU shall attempt in good faith to resolve such disagreement. Any resolution first select Excess Preferred Securities for redemption unless otherwise agreed to by BAM. BBU shall not be required to deliver more than one Triggering Event Notice with respect any Triggering Event. BBU acknowledges that BAM is relying upon this Commitment Agreement in writing by the Parties shall be final and binding upon the Parties. If the Parties are unable to resolve any disagreement as subscribing for Preferred Securities pursuant to the calculation of Commitment and acknowledges BBU’s obligation to cause the Fair Market Value or the Statutory Book Value, as applicable, of any Eligible Asset or whether any asset is an Eligible Asset within [REDACTED] Business Days after the Ceding Company delivers written notice redemption of any such disagreement to the Reinsurer, the Parties shall jointly request the Independent Accountant to determine the Fair Market Value or the Statutory Book Value, as applicable, of the disputed Eligible Asset or whether the disputed asset is an Eligible Asset as of the relevant date Preferred Securities issued by any BBU Subsidiary Issuers in connection with any Redemption Notice delivered by BAM in accordance with the procedures set forth in Section 2.12 of the Master Transaction Agreement, mutatis mutandis. The Independent Accountant’s determination of the Fair Market Value or the Statutory Book Value, as applicable, of the disputed Eligible Asset or whether the disputed asset is an Eligible Asset shall be final and binding upon the Parties. The fees, costs and expenses associated with the Independent Accountant’s determination shall be allocated between the Ceding Company and the Reinsurer in accordance with the Independent Accountant’s judgment as to the relative merits of the Parties’ proposals in respect of the dispute. After a final and binding resolution of any dispute described in this Section 4.8(c) is reached, the Parties agree to make any necessary adjustments under Section 4.8(a) so that the aggregate Fair Market Value or the Statutory Book Value, as applicable, of the Eligible Assets held in the Trust Account is not less than the amount required pursuant to Section 4.8(a)(i) or (a)(ii), as applicable8.

Triggering Event. The Parties acknowledge 11 EXHIBIT A [FORM OF RIGHT CERTIFICATE] Certificate No. R - ___________ Rights NOT EXERCISABLE AFTER october 31, 2010 OR EARLIER IF NOTICE OF REDEMPTION IS GIVEN. THE RIGHTS ARE SUBJECT TO REDEMPTION, AT THE OPTION OF THE COMPANY, AT $0.005 PER RIGHT ON THE TERMS SET FORTH IN THE amended and agree thatrestated RIGHTS AGREEMENT. [THE RIGHTS REPRESENTED BY THIS CERTIFICATE ARE OR WERE BENEFICIALLY OWNED BY A PERSON WHO WAS OR BECAME AN ACQUIRING PERSON OR AN ASSOCIATED ACQUIRING PERSON (AS SUCH TERMS ARE DEFINED IN THE RIGHTS AGREEMENT). ACCORDINGLY, upon THIS RIGHT CERTIFICATE AND THE RIGHTS REPRESENTED HEREBY MAY BECOME NULL AND VOID IN THE CIRCUMSTANCES SPECIFIED IN Section 7(e) OF THE RIGHTS AGREEMENT.]* RIGHT CERTIFICATE This certifies that _________________, or registered assigns, is the occurrence registered owner of the number of Rights set forth above, each of which entitles the owner thereof, subject to the terms, provisions and conditions of a Triggering Eventrights agreement, certain provisions of this Agreement and as amended to date (the Trust Agreement shall cease to be effective"Rights Agreement"), between Jo-Ann Stores, Inc., an Ohio corporation (the "Company"), and other provisions shall automatically be effective, so long as such Triggering Event continues____________________, as described herein and in Rights Agent (the Trust Agreement. Provisions that will automatically become modified upon the occurrence and during the continuation of a Triggering Event are as follows: (a) the valuation of Eligible Assets in the Trust Account under Section 4.2(b) and all other applicable sections of this Agreement shall be modified from Statutory Book Value "Rights Agent"), to Fair Market Value, (b) Section 4.7(a) governing the use and application of assets in the Trust Account by the Ceding Company prior to a Triggering Event shall not apply, (c) Section 4.7(b) governing the use and application of assets in the Trust Account by the Ceding Company during the continuance of a Triggering Event shall apply, (d) Section 4.8(a)(i) governing the adjustment of the security held in the Trust Account prior to a Triggering Event shall not apply, and (e) Section 4.8(a)(ii) governing the adjustment of the security held in the Trust Account following a Triggering Event shall apply. Withdrawal of Assets purchase from the Trust Account. So long as no Triggering Event has occurred and is continuing, the Ceding Company and the Reinsurer agree that the assets maintained in the Trust Account may be withdrawn by the Ceding Company or any successor by operation of law of the Ceding Company, including, without limitation, any liquidator, rehabilitator, receiver or conservator of the Ceding Company, without diminution because of any insolvency, rehabilitation, conservatorship or comparable proceeding (an “Insolvency”) on the part of the Ceding Company or the Reinsurer, only in accordance with the terms of the Trust Agreement, (i) in order to pay or reimburse the Ceding Company for any undisputed amounts due from the Reinsurer under this Agreement and not yet recovered from the Reinsurer, including any Reinsured Liabilities, Terminal Settlement, or other amounts due under this Agreement, which amounts have not been paid by the Reinsurer within ten (10) calendar days following the Reinsurer’s receipt of a specific written notice thereof, or (ii) otherwise with the prior written consent of the Reinsurer. During the continuation of a Triggering Event, the Ceding Company and the Reinsurer agree that the assets maintained in the Trust Account may be withdrawn by the Ceding Company, or any successors by operation of law of the Ceding Company, including without limitation any liquidator, rehabilitator, receiver or conservator of the Ceding Company, without diminution because of Insolvency on the part of the Ceding Company or the Reinsurer, at any time after the Shares Acquisition Date (notwithstanding any other provisions of this Agreement or as such term is defined in the other Transaction AgreementsRights Agreement) without notice or consent from and prior to 5:00 P.M., Cleveland time, on October 31, 2010, at the Reinsurer, but only for one or more principal office of the following purposes: to pay or reimburse the Ceding Company for the Reinsurer’s share of premiums returnedRights Agent, but not yet recovered from the Reinsurer, to the Contractholders or Insureds of the Reinsured Contracts reinsured hereunder because of cancellations of the Reinsured Contracts or certificates issued thereunder; to pay or reimburse the Ceding Company for the Reinsurer’s share of surrenders and benefits or losses payable by the Ceding Company pursuant to the provisions of the Reinsured Contracts reinsured hereunder; to pay or reimburse the Ceding Company for any other amounts necessary to secure the credit or reduction from liability for reinsurance taken by the Ceding Company hereunder; and for any other purpose required under the credit for reinsurance regulations of the Ceding Company Domiciliary State in order to secure the credit or reduction from liability for reinsurance taken by the Ceding Company hereunder. The Ceding Company shall promptly return to the Trust Account assets withdrawn in excess of the actual amounts required for Section 4.7 (a) and (b) above, together with interest on such excess withdrawn amounts at the Interest Rate for the period that such assets are held by the Ceding Company. Until such excess amounts are so returned to the Trust Account, any such amounts shall at all times be held by the Ceding Company or its successors as Rights Agent, in interest by operation of law__________, including___________, without limitation, any liquidator, rehabilitator, receiver or conservator one Common Share of the Ceding Company, in trust for Company (the benefit of the Reinsurer and be maintained in a segregated account, separate and apart from any assets of the Ceding Company for the sole purpose of funding the reimbursements and payments described in Section 4.7(a) or (b"Common Share"), as applicable. Adjustment at a purchase price of Security $52.17 per share (the "Purchase Price"), upon presentation and Withdrawalssurrender of this Right Certificate with the Form of Election to Purchase duly executed. The amount number of security required to Rights evidenced by this Right Certificate, the number of Common Shares that may be provided by purchased upon exercise thereof and the Reinsurer hereunder shall be adjusted following Purchase Price per share set forth above are the end of each calendar quarter ending after the Effective Time based on (i) the Required Balance numbers and Purchase Price as of the end of such calendar quarter calculated in good faith by the Reinsurer as Administrator and furnished to the Ceding Company in a report (orNovember 4, following termination of the Administrative Services Agreement2003, calculated in good faith by the Ceding Company and furnished to the Reinsurer in a report) (the “Security Funding Report”) no later than ten (10) Business Days following the end of such calendar quarter (the “Security Funding Reporting Date”) and (ii) the Statutory Book Value or, following the occurrence and during the continuation of a Triggering Event, the Fair Market Value of the Eligible Assets held in the Trust Account as of the end of such calendar quarter as furnished by the Reinsurer to the Ceding Company in a report no later than the Security Funding Reporting Date. The amount of security required to be held in the Trust Account shall be adjusted as follows: So long as no Triggering Event has occurred and is continuing: If the aggregate Statutory Book Value of the Eligible Assets held in the Trust Account as of the end of any calendar quarter is less than the Required Balance, calculated based on the Security Funding Report for such calendar quarter, then the Reinsurer shall, no later than [REDACTED] calendar days following the Security Funding Reporting Date for such quarter, transfer additional Eligible Assets to the Trust Account so that the aggregate Statutory Book Value Common Shares of the Eligible Assets held in the Trust Account is not less than the Required Balance; and If the aggregate Statutory Book Value of the Eligible Assets held in the Trust Account as of the end of any calendar quarter exceeds the Required Balance, calculated based on the Security Funding Report for such calendar quarter, then the Reinsurer shall have the right to withdraw such excess in accordance with the procedures set forth in the Trust Agreement. If the Reinsurer seeks to cause the Trustee to substitute new Eligible Assets for Eligible Assets held in the Trust Account, which new Eligible Assets have an aggregate Statutory Book Value at least equal to the aggregate Statutory Book Value of the substituted Eligible Assets held in the Trust Account immediately prior to such substitution and the aggregate Fair Market Value of such new Eligible Assets is at least equal to the lesser of (A) the aggregate Statutory Book Value of such new Eligible Assets and (B) the aggregate Fair Market Value of the substituted Eligible Assets, then the Reinsurer shall have the right to cause (and shall only cause) the Trustee to effect such substitution in accordance with the procedures set forth in the Trust Agreement. During the continuation of a Triggering Event: If the aggregate Fair Market Value of the Eligible Assets held in the Trust Account as of the end of any calendar quarter is less than the Required Balance, calculated based on the Security Funding Report for such calendar quarter, then the Reinsurer shall, no later than three (3) Business Days following the Security Funding Reporting Date for such calendar quarter, transfer additional Eligible Assets to the Trust Account so that the aggregate Fair Market Value of the Eligible Assets held in the Trust Account is not less than the Required Balance; and If the aggregate Fair Market Value of the Eligible Assets held in the Trust Account as of the end of any calendar quarter (x) if no RBC Event is continuing, exceeds [REDACTED] of, and (y) if an RBC Event is continuing, exceeds one hundred percent (100%) of, the Required Balance, calculated based on the Security Funding Report for such calendar quarter, then the Reinsurer shall have the right to seek consent from the Ceding Company to withdraw such excess in accordance with the procedures set forth in the Trust Agreement, which consent shall be provided by the Ceding Company as promptly as reasonably practicableconstituted at such date. If the Reinsurer seeks to cause the Trustee to substitute new Eligible Assets for Eligible Assets held in the Trust Account, which new Eligible Assets have an aggregate Fair Market Value at least equal to the aggregate Fair Market Value of the substituted Eligible Assets held in the Trust Account immediately prior to such substitution, then the Reinsurer shall have the right to cause the Trustee to effect such substitution with the prior written consent of the Ceding Company, which consent the Ceding Company shall deliver as promptly as reasonably practicable following the Ceding Company’s confirmation of the aggregate Fair Market Values of the Eligible Assets to be substituted and being replaced. In addition, as soon as reasonably practicable, and no later than (i) [REDACTED] calendar days after the Reinsurer becomes aware of Upon the occurrence of a Triggering Event (other than a Reserve Credit Event) as such term is defined in the Rights Agreement), each Right will entitled the holder to receive, upon presentation and surrender of this Right Certificate with the Form of Election to Purchase duly executed, one Common Share for an Exercise Price of $.43 per share (ii) the earlier "Exercise Price"). If the Rights evidenced by this Right Certificate are or at any time were beneficially owned by an Acquiring Person or an Associated Acquiring Person (as such terms are defined in the Rights Agreement), such Rights will become null and void and no holder hereof -------- * The portion of (x) [REDACTED] calendar days the legend in brackets will be inserted only if applicable. A-1 will have any right with respect to such Rights from and after the Reinsurer becomes aware of the occurrence of a Reserve Credit Event such Triggering Event. As provided in the Rights Agreement, the Purchase Price, the Exercise Price and (y) number and kind of Common Shares or other securities that may be purchased upon the fiscal quarter- or fiscal year-end following the date on which the Reinsurer becomes aware exercise of the occurrence Rights evidenced by this Right Certificate are subject to modification and adjustment upon the happening of certain events. This Right Certificate is subject to all of the Reserve Credit Eventterms, (in each case provisions and conditions of (i) the Rights Agreement; reference is made to the Rights Agreement for a full description of the rights, limitations of rights, obligations, duties and (ii), unless immunities of the Ceding Company shall agree to a longer period, then by the end of such longer period)Rights Agent, the Reinsurer shall (i) substitute any assets in Company and the Trust Account that are not Eligible Assets for assets that are Eligible Assets, and (ii) deposit additional assets consisting of Eligible Assets in the Trust Account sufficient to ensure that the aggregate Fair Market Value holders of the Eligible Assets in the Trust Account is not less than the Required Balance as Right Certificates. Copies of the last day Rights Agreement are on file at the principal office of the immediately preceding calendar quarter. The report required to be delivered by the Reinsurer as described Rights Agent in Section 4.8(a) shall include a listing of each asset in the Trust Account and the Statutory Book Value or________, following the occurrence and during the continuance of a Triggering Event, the Fair Market Value, of each such asset as of the end of the relevant calendar quarter________. In addition, no later than [REDACTED] calendar days following the end Company will mail to the holder of each calendar quarterthis certificate a copy of the Rights Agreement (as in effect on the date of mailing) without charge promptly after receipt of a written request therefor. This Right Certificate, with or without other Right Certificates, upon surrender at the principal office of the Rights Agent, may be exchanged for another Right Certificate or Right Certificates of like tenor and date evidencing Rights entitling the holder to purchase a like aggregate number of Common Shares as the Rights evidenced by the Right Certificate or Right Certificates surrendered entitled such holder to purchase. If this Right Certificate is exercised in part, the Reinsurer shall provide holder will be entitled to receive upon surrender hereof another Right Certificate or Right Certificates for the number of whole Rights not exercised. Subject to the Ceding provisions of the Rights Agreement, the Rights evidenced by this Right Certificate may be redeemed by the Company at its option at a report indicating if redemption price of $0.005 per Right. The Company will not issue any fractional Common Shares upon the exercise of any Right or Rights evidenced hereby, but in lieu thereof may make a cash payment, as provided in the Rights Agreement. No holder of this Right Certificate will be entitled to vote or receive dividends or be deemed for any purpose the holder of the Common Shares or of any other securities of the Company that may at any time be issuable on the exercise hereof, nor will anything contained in the Rights Agreement or herein be construed to confer upon the holder hereof, as such, any of the assets rights of a shareholder of the Company or any right to vote for the election of directors or upon any matter submitted to shareholders at any meeting thereof, or to give or withhold consent to any corporate action, or to receive notice of meetings or other actions affecting shareholders (except as provided in the Security Funding Report Rights Agreement), or to receive dividends or subscription rights, or otherwise, until the Right or Rights evidenced by this Right Certificate have been exercised as provided in the Rights Agreement. This Right Certificate will not be valid or obligatory for such calendar quarter are not an Eligible Asset any purpose until it has been countersigned by the Rights Agent. WITNESS the signature (which may be by facsimile) of the proper officers of the Company. Dated as of __________________, 20___. JO-ANN STORES, INC. ATTEST: By:_____________________________ By:_____________________________ Name:___________________________ Name:___________________________ Title:__________________________ Title:__________________________ Countersigned: By:_____________________________ Name:___________________________ Title:__________________________ [FORM OF REVERSE SIDE OF RIGHT CERTIFICATE] FORM OF ASSIGNMENT (To be executed by the registered holder if the holder desires to transfer the Right Certificate) FOR VALUE RECEIVED _________________________________ hereby sells, assigns and including reasonable transfers unto (Please print name and customary backup material demonstrating that the assets in Trust Accountaddress of transferee) this Right Certificate, together with all right, title and interest therein, and does hereby irrevocably constitute and appoint _______________________________ as attorney, to transfer the assets in Right Certificate on the Protective Life and Annuity Trust Accountbooks of Jo-Ann Stores, are in compliance Inc., with full power of substitution. Dated: __________________, 20___ Signature Signature Guaranteed: CERTIFICATE The undersigned hereby certifies by checking the investment guidelines set forth on Schedule C. In the event that the Ceding Company disagrees with the calculation of the Fair Market Value or the Statutory Book Value, as applicable, of any Eligible Asset or whether any asset is an Eligible Asset as set forth in any such report, the Ceding Company may deliver written notice to the Reinsurer of such disagreement and the Parties shall attempt in good faith to resolve such disagreement. Any resolution agreed to in writing by the Parties shall be final and binding upon the Parties. If the Parties are unable to resolve any disagreement as to the calculation of the Fair Market Value or the Statutory Book Value, as applicable, of any Eligible Asset or whether any asset is an Eligible Asset within [REDACTED] Business Days after the Ceding Company delivers written notice of any such disagreement to the Reinsurer, the Parties shall jointly request the Independent Accountant to determine the Fair Market Value or the Statutory Book Value, as applicable, of the disputed Eligible Asset or whether the disputed asset is an Eligible Asset as of the relevant date in accordance with the procedures set forth in Section 2.12 of the Master Transaction Agreement, mutatis mutandis. The Independent Accountant’s determination of the Fair Market Value or the Statutory Book Value, as applicable, of the disputed Eligible Asset or whether the disputed asset is an Eligible Asset shall be final and binding upon the Parties. The fees, costs and expenses associated with the Independent Accountant’s determination shall be allocated between the Ceding Company and the Reinsurer in accordance with the Independent Accountant’s judgment as to the relative merits of the Parties’ proposals in respect of the dispute. After a final and binding resolution of any dispute described in this Section 4.8(c) is reached, the Parties agree to make any necessary adjustments under Section 4.8(a) so that the aggregate Fair Market Value or the Statutory Book Value, as applicable, of the Eligible Assets held in the Trust Account is not less than the amount required pursuant to Section 4.8(a)(i) or (a)(ii), as applicable.appropriate boxes that:

Triggering Event. The Parties acknowledge 11 EXHIBIT A [FORM OF RIGHT CERTIFICATE] Certificate No. R - ___________ Rights NOT EXERCISABLE AFTER october 31, 2010 OR EARLIER IF NOTICE OF REDEMPTION IS GIVEN. THE RIGHTS ARE SUBJECT TO REDEMPTION, AT THE OPTION OF THE COMPANY, AT $0.005 PER RIGHT ON THE TERMS SET FORTH IN THE amended and agree thatrestated RIGHTS AGREEMENT. [THE RIGHTS REPRESENTED BY THIS CERTIFICATE ARE OR WERE BENEFICIALLY OWNED BY A PERSON WHO WAS OR BECAME AN ACQUIRING PERSON OR AN ASSOCIATED ACQUIRING PERSON (AS SUCH TERMS ARE DEFINED IN THE RIGHTS AGREEMENT). ACCORDINGLY, upon THIS RIGHT CERTIFICATE AND THE RIGHTS REPRESENTED HEREBY MAY BECOME NULL AND VOID IN THE CIRCUMSTANCES SPECIFIED IN Section 7(e) OF THE RIGHTS AGREEMENT.]* RIGHT CERTIFICATE This certifies that _________________, or registered assigns, is the occurrence registered owner of the number of Rights set forth above, each of which entitles the owner thereof, subject to the terms, provisions and conditions of a Triggering Eventrights agreement, certain provisions of this Agreement and as amended to date (the Trust Agreement shall cease to be effective"Rights Agreement"), between ▇▇-▇▇▇ Stores, Inc., an Ohio corporation (the "Company"), and other provisions shall automatically be effective, so long as such Triggering Event continues____________________, as described herein and in Rights Agent (the Trust Agreement. Provisions that will automatically become modified upon the occurrence and during the continuation of a Triggering Event are as follows: (a) the valuation of Eligible Assets in the Trust Account under Section 4.2(b) and all other applicable sections of this Agreement shall be modified from Statutory Book Value "Rights Agent"), to Fair Market Value, (b) Section 4.7(a) governing the use and application of assets in the Trust Account by the Ceding Company prior to a Triggering Event shall not apply, (c) Section 4.7(b) governing the use and application of assets in the Trust Account by the Ceding Company during the continuance of a Triggering Event shall apply, (d) Section 4.8(a)(i) governing the adjustment of the security held in the Trust Account prior to a Triggering Event shall not apply, and (e) Section 4.8(a)(ii) governing the adjustment of the security held in the Trust Account following a Triggering Event shall apply. Withdrawal of Assets purchase from the Trust Account. So long as no Triggering Event has occurred and is continuing, the Ceding Company and the Reinsurer agree that the assets maintained in the Trust Account may be withdrawn by the Ceding Company or any successor by operation of law of the Ceding Company, including, without limitation, any liquidator, rehabilitator, receiver or conservator of the Ceding Company, without diminution because of any insolvency, rehabilitation, conservatorship or comparable proceeding (an “Insolvency”) on the part of the Ceding Company or the Reinsurer, only in accordance with the terms of the Trust Agreement, (i) in order to pay or reimburse the Ceding Company for any undisputed amounts due from the Reinsurer under this Agreement and not yet recovered from the Reinsurer, including any Reinsured Liabilities, Terminal Settlement, or other amounts due under this Agreement, which amounts have not been paid by the Reinsurer within ten (10) calendar days following the Reinsurer’s receipt of a specific written notice thereof, or (ii) otherwise with the prior written consent of the Reinsurer. During the continuation of a Triggering Event, the Ceding Company and the Reinsurer agree that the assets maintained in the Trust Account may be withdrawn by the Ceding Company, or any successors by operation of law of the Ceding Company, including without limitation any liquidator, rehabilitator, receiver or conservator of the Ceding Company, without diminution because of Insolvency on the part of the Ceding Company or the Reinsurer, at any time after the Shares Acquisition Date (notwithstanding any other provisions of this Agreement or as such term is defined in the other Transaction AgreementsRights Agreement) without notice or consent from and prior to 5:00 P.M., Cleveland time, on October 31, 2010, at the Reinsurer, but only for one or more principal office of the following purposes: to pay or reimburse the Ceding Company for the Reinsurer’s share of premiums returnedRights Agent, but not yet recovered from the Reinsurer, to the Contractholders or Insureds of the Reinsured Contracts reinsured hereunder because of cancellations of the Reinsured Contracts or certificates issued thereunder; to pay or reimburse the Ceding Company for the Reinsurer’s share of surrenders and benefits or losses payable by the Ceding Company pursuant to the provisions of the Reinsured Contracts reinsured hereunder; to pay or reimburse the Ceding Company for any other amounts necessary to secure the credit or reduction from liability for reinsurance taken by the Ceding Company hereunder; and for any other purpose required under the credit for reinsurance regulations of the Ceding Company Domiciliary State in order to secure the credit or reduction from liability for reinsurance taken by the Ceding Company hereunder. The Ceding Company shall promptly return to the Trust Account assets withdrawn in excess of the actual amounts required for Section 4.7 (a) and (b) above, together with interest on such excess withdrawn amounts at the Interest Rate for the period that such assets are held by the Ceding Company. Until such excess amounts are so returned to the Trust Account, any such amounts shall at all times be held by the Ceding Company or its successors as Rights Agent, in interest by operation of law__________, including___________, without limitation, any liquidator, rehabilitator, receiver or conservator one Common Share of the Ceding Company, in trust for Company (the benefit of the Reinsurer and be maintained in a segregated account, separate and apart from any assets of the Ceding Company for the sole purpose of funding the reimbursements and payments described in Section 4.7(a) or (b"Common Share"), as applicable. Adjustment at a purchase price of Security $52.17 per share (the "Purchase Price"), upon presentation and Withdrawalssurrender of this Right Certificate with the Form of Election to Purchase duly executed. The amount number of security required to Rights evidenced by this Right Certificate, the number of Common Shares that may be provided by purchased upon exercise thereof and the Reinsurer hereunder shall be adjusted following Purchase Price per share set forth above are the end of each calendar quarter ending after the Effective Time based on (i) the Required Balance numbers and Purchase Price as of the end of such calendar quarter calculated in good faith by the Reinsurer as Administrator and furnished to the Ceding Company in a report (orNovember 4, following termination of the Administrative Services Agreement2003, calculated in good faith by the Ceding Company and furnished to the Reinsurer in a report) (the “Security Funding Report”) no later than ten (10) Business Days following the end of such calendar quarter (the “Security Funding Reporting Date”) and (ii) the Statutory Book Value or, following the occurrence and during the continuation of a Triggering Event, the Fair Market Value of the Eligible Assets held in the Trust Account as of the end of such calendar quarter as furnished by the Reinsurer to the Ceding Company in a report no later than the Security Funding Reporting Date. The amount of security required to be held in the Trust Account shall be adjusted as follows: So long as no Triggering Event has occurred and is continuing: If the aggregate Statutory Book Value of the Eligible Assets held in the Trust Account as of the end of any calendar quarter is less than the Required Balance, calculated based on the Security Funding Report for such calendar quarter, then the Reinsurer shall, no later than [REDACTED] calendar days following the Security Funding Reporting Date for such quarter, transfer additional Eligible Assets to the Trust Account so that the aggregate Statutory Book Value Common Shares of the Eligible Assets held in the Trust Account is not less than the Required Balance; and If the aggregate Statutory Book Value of the Eligible Assets held in the Trust Account as of the end of any calendar quarter exceeds the Required Balance, calculated based on the Security Funding Report for such calendar quarter, then the Reinsurer shall have the right to withdraw such excess in accordance with the procedures set forth in the Trust Agreement. If the Reinsurer seeks to cause the Trustee to substitute new Eligible Assets for Eligible Assets held in the Trust Account, which new Eligible Assets have an aggregate Statutory Book Value at least equal to the aggregate Statutory Book Value of the substituted Eligible Assets held in the Trust Account immediately prior to such substitution and the aggregate Fair Market Value of such new Eligible Assets is at least equal to the lesser of (A) the aggregate Statutory Book Value of such new Eligible Assets and (B) the aggregate Fair Market Value of the substituted Eligible Assets, then the Reinsurer shall have the right to cause (and shall only cause) the Trustee to effect such substitution in accordance with the procedures set forth in the Trust Agreement. During the continuation of a Triggering Event: If the aggregate Fair Market Value of the Eligible Assets held in the Trust Account as of the end of any calendar quarter is less than the Required Balance, calculated based on the Security Funding Report for such calendar quarter, then the Reinsurer shall, no later than three (3) Business Days following the Security Funding Reporting Date for such calendar quarter, transfer additional Eligible Assets to the Trust Account so that the aggregate Fair Market Value of the Eligible Assets held in the Trust Account is not less than the Required Balance; and If the aggregate Fair Market Value of the Eligible Assets held in the Trust Account as of the end of any calendar quarter (x) if no RBC Event is continuing, exceeds [REDACTED] of, and (y) if an RBC Event is continuing, exceeds one hundred percent (100%) of, the Required Balance, calculated based on the Security Funding Report for such calendar quarter, then the Reinsurer shall have the right to seek consent from the Ceding Company to withdraw such excess in accordance with the procedures set forth in the Trust Agreement, which consent shall be provided by the Ceding Company as promptly as reasonably practicableconstituted at such date. If the Reinsurer seeks to cause the Trustee to substitute new Eligible Assets for Eligible Assets held in the Trust Account, which new Eligible Assets have an aggregate Fair Market Value at least equal to the aggregate Fair Market Value of the substituted Eligible Assets held in the Trust Account immediately prior to such substitution, then the Reinsurer shall have the right to cause the Trustee to effect such substitution with the prior written consent of the Ceding Company, which consent the Ceding Company shall deliver as promptly as reasonably practicable following the Ceding Company’s confirmation of the aggregate Fair Market Values of the Eligible Assets to be substituted and being replaced. In addition, as soon as reasonably practicable, and no later than (i) [REDACTED] calendar days after the Reinsurer becomes aware of Upon the occurrence of a Triggering Event (other than a Reserve Credit Event) as such term is defined in the Rights Agreement), each Right will entitled the holder to receive, upon presentation and surrender of this Right Certificate with the Form of Election to Purchase duly executed, one Common Share for an Exercise Price of $.43 per share (ii) the earlier "Exercise Price"). If the Rights evidenced by this Right Certificate are or at any time were beneficially owned by an Acquiring Person or an Associated Acquiring Person (as such terms are defined in the Rights Agreement), such Rights will become null and void and no holder hereof ----------------- * The portion of (x) [REDACTED] calendar days the legend in brackets will be inserted only if applicable. will have any right with respect to such Rights from and after the Reinsurer becomes aware of the occurrence of a Reserve Credit Event such Triggering Event. As provided in the Rights Agreement, the Purchase Price, the Exercise Price and (y) number and kind of Common Shares or other securities that may be purchased upon the fiscal quarter- or fiscal year-end following the date on which the Reinsurer becomes aware exercise of the occurrence Rights evidenced by this Right Certificate are subject to modification and adjustment upon the happening of certain events. This Right Certificate is subject to all of the Reserve Credit Eventterms, (in each case provisions and conditions of (i) the Rights Agreement; reference is made to the Rights Agreement for a full description of the rights, limitations of rights, obligations, duties and (ii), unless immunities of the Ceding Company shall agree to a longer period, then by the end of such longer period)Rights Agent, the Reinsurer shall (i) substitute any assets in Company and the Trust Account that are not Eligible Assets for assets that are Eligible Assets, and (ii) deposit additional assets consisting of Eligible Assets in the Trust Account sufficient to ensure that the aggregate Fair Market Value holders of the Eligible Assets in the Trust Account is not less than the Required Balance as Right Certificates. Copies of the last day Rights Agreement are on file at the principal office of the immediately preceding calendar quarter. The report required to be delivered by the Reinsurer as described Rights Agent in Section 4.8(a) shall include a listing of each asset in the Trust Account and the Statutory Book Value or________, following the occurrence and during the continuance of a Triggering Event, the Fair Market Value, of each such asset as of the end of the relevant calendar quarter________. In addition, no later than [REDACTED] calendar days following the end Company will mail to the holder of each calendar quarterthis certificate a copy of the Rights Agreement (as in effect on the date of mailing) without charge promptly after receipt of a written request therefor. This Right Certificate, with or without other Right Certificates, upon surrender at the principal office of the Rights Agent, may be exchanged for another Right Certificate or Right Certificates of like tenor and date evidencing Rights entitling the holder to purchase a like aggregate number of Common Shares as the Rights evidenced by the Right Certificate or Right Certificates surrendered entitled such holder to purchase. If this Right Certificate is exercised in part, the Reinsurer shall provide holder will be entitled to receive upon surrender hereof another Right Certificate or Right Certificates for the number of whole Rights not exercised. Subject to the Ceding provisions of the Rights Agreement, the Rights evidenced by this Right Certificate may be redeemed by the Company at its option at a report indicating if redemption price of $0.005 per Right. The Company will not issue any fractional Common Shares upon the exercise of any Right or Rights evidenced hereby, but in lieu thereof may make a cash payment, as provided in the Rights Agreement. No holder of this Right Certificate will be entitled to vote or receive dividends or be deemed for any purpose the holder of the Common Shares or of any other securities of the Company that may at any time be issuable on the exercise hereof, nor will anything contained in the Rights Agreement or herein be construed to confer upon the holder hereof, as such, any of the assets rights of a shareholder of the Company or any right to vote for the election of directors or upon any matter submitted to shareholders at any meeting thereof, or to give or withhold consent to any corporate action, or to receive notice of meetings or other actions affecting shareholders (except as provided in the Security Funding Report Rights Agreement), or to receive dividends or subscription rights, or otherwise, until the Right or Rights evidenced by this Right Certificate have been exercised as provided in the Rights Agreement. This Right Certificate will not be valid or obligatory for such calendar quarter are not an Eligible Asset any purpose until it has been countersigned by the Rights Agent. WITNESS the signature (which may be by facsimile) of the proper officers of the Company. Dated as of __________________, 20___. ▇▇-▇▇▇ STORES, INC. ATTEST: By:_____________________________ By:_____________________________ Name:___________________________ Name:___________________________ Title:__________________________ Title:__________________________ Countersigned: By:_____________________________ Name:___________________________ Title:__________________________ [FORM OF REVERSE SIDE OF RIGHT CERTIFICATE] FORM OF ASSIGNMENT (To be executed by the registered holder if the holder desires to transfer the Right Certificate) FOR VALUE RECEIVED _________________________________ hereby sells, assigns and including reasonable transfers unto (Please print name and customary backup material demonstrating that the assets in Trust Accountaddress of transferee) this Right Certificate, together with all right, title and interest therein, and does hereby irrevocably constitute and appoint _______________________________ as attorney, to transfer the assets in Right Certificate on the Protective Life and Annuity Trust Accountbooks of ▇▇-▇▇▇ Stores, are in compliance Inc., with the investment guidelines set forth on Schedule C. In the event that the Ceding Company disagrees with the calculation full power of the Fair Market Value or the Statutory Book Valuesubstitution. Dated: __________________, as applicable, of any Eligible Asset or whether any asset is an Eligible Asset as set forth in any such report, the Ceding Company may deliver written notice to the Reinsurer of such disagreement and the Parties shall attempt in good faith to resolve such disagreement. Any resolution agreed to in writing by the Parties shall be final and binding upon the Parties. If the Parties are unable to resolve any disagreement as to the calculation of the Fair Market Value or the Statutory Book Value, as applicable, of any Eligible Asset or whether any asset is an Eligible Asset within [REDACTED] Business Days after the Ceding Company delivers written notice of any such disagreement to the Reinsurer, the Parties shall jointly request the Independent Accountant to determine the Fair Market Value or the Statutory Book Value, as applicable, of the disputed Eligible Asset or whether the disputed asset is an Eligible Asset as of the relevant date in accordance with the procedures set forth in Section 2.12 of the Master Transaction Agreement, mutatis mutandis. The Independent Accountant’s determination of the Fair Market Value or the Statutory Book Value, as applicable, of the disputed Eligible Asset or whether the disputed asset is an Eligible Asset shall be final and binding upon the Parties. The fees, costs and expenses associated with the Independent Accountant’s determination shall be allocated between the Ceding Company and the Reinsurer in accordance with the Independent Accountant’s judgment as to the relative merits of the Parties’ proposals in respect of the dispute. After a final and binding resolution of any dispute described in this Section 4.8(c) is reached, the Parties agree to make any necessary adjustments under Section 4.8(a) so that the aggregate Fair Market Value or the Statutory Book Value, as applicable, of the Eligible Assets held in the Trust Account is not less than the amount required pursuant to Section 4.8(a)(i) or (a)(ii), as applicable.20___ Signature Signature Guaranteed:

Triggering Event. The Parties acknowledge and agree that, upon the occurrence of a A “Triggering Event, certain provisions of this Agreement and the Trust Agreement shall cease to be effective, and other provisions shall automatically be effective, so long as such Triggering Event continues, as described herein and in the Trust Agreement. Provisions that will automatically become modified upon the occurrence and during the continuation of a Triggering Event are as follows: (a) the valuation of Eligible Assets in the Trust Account under Section 4.2(b) and all other applicable sections of this Agreement ” shall be modified from Statutory Book Value deemed to Fair Market Value, (b) Section 4.7(a) governing the use and application of assets in the Trust Account by the Ceding Company prior to a Triggering Event shall not apply, (c) Section 4.7(b) governing the use and application of assets in the Trust Account by the Ceding Company during the continuance of a Triggering Event shall apply, (d) Section 4.8(a)(i) governing the adjustment of the security held in the Trust Account prior to a Triggering Event shall not apply, and (e) Section 4.8(a)(ii) governing the adjustment of the security held in the Trust Account following a Triggering Event shall apply. Withdrawal of Assets from the Trust Account. So long as no Triggering Event has have occurred and is continuing, the Ceding Company and the Reinsurer agree that the assets maintained in the Trust Account may be withdrawn by the Ceding Company or any successor by operation of law of the Ceding Company, including, without limitation, any liquidator, rehabilitator, receiver or conservator of the Ceding Company, without diminution because of any insolvency, rehabilitation, conservatorship or comparable proceeding (an “Insolvency”) on the part of the Ceding Company or the Reinsurer, only in accordance with the terms of the Trust Agreement, (i) in order to pay or reimburse the Ceding Company for any undisputed amounts due from the Reinsurer under this Agreement and not yet recovered from the Reinsurer, including any Reinsured Liabilities, Terminal Settlement, or other amounts due under this Agreement, which amounts have not been paid by the Reinsurer within ten (10) calendar days following the Reinsurer’s receipt of a specific written notice thereof, or (ii) otherwise with the prior written consent of the Reinsurer. During the continuation of a Triggering Event, the Ceding Company and the Reinsurer agree that the assets maintained in the Trust Account may be withdrawn by the Ceding Company, or any successors by operation of law of the Ceding Company, including without limitation any liquidator, rehabilitator, receiver or conservator of the Ceding Company, without diminution because of Insolvency on the part of the Ceding Company or the Reinsurer, at any time (notwithstanding any other provisions of this Agreement or the other Transaction Agreements) without notice or consent from the Reinsurer, but only for one or more of the following purposesif: to pay or reimburse the Ceding Company for the Reinsurer’s share of premiums returned, but not yet recovered from the Reinsurer, to the Contractholders or Insureds of the Reinsured Contracts reinsured hereunder because of cancellations of the Reinsured Contracts or certificates issued thereunder; to pay or reimburse the Ceding Company for the Reinsurer’s share of surrenders and benefits or losses payable by the Ceding Company pursuant to the provisions of the Reinsured Contracts reinsured hereunder; to pay or reimburse the Ceding Company for any other amounts necessary to secure the credit or reduction from liability for reinsurance taken by the Ceding Company hereunder; and for any other purpose required under the credit for reinsurance regulations of the Ceding Company Domiciliary State in order to secure the credit or reduction from liability for reinsurance taken by the Ceding Company hereunder. The Ceding Company shall promptly return to the Trust Account assets withdrawn in excess of the actual amounts required for Section 4.7 (a) and (b) above, together with interest on such excess withdrawn amounts at the Interest Rate for the period that such assets are held by the Ceding Company. Until such excess amounts are so returned to the Trust Account, any such amounts shall at all times be held by the Ceding Company or its successors in interest by operation of law, including, without limitation, any liquidator, rehabilitator, receiver or conservator of the Ceding Company, in trust for the benefit of the Reinsurer and be maintained in a segregated account, separate and apart from any assets of the Ceding Company for the sole purpose of funding the reimbursements and payments described in Section 4.7(a) or (b), as applicable. Adjustment of Security and Withdrawals. The amount of security required to be provided by the Reinsurer hereunder shall be adjusted following the end of each calendar quarter ending after the Effective Time based on (i) the Required Balance as board of directors of the end of such calendar quarter calculated Company shall have failed to recommend that the Company’s stockholders vote to adopt the Agreement, or shall have withdrawn or modified in good faith by a manner adverse to Parent or Acquisition Sub the Reinsurer as Administrator and furnished Company Board Recommendation; (ii) the Company shall have failed to include in the Proxy Statement the Company Board Recommendation or a statement to the Ceding Company in a report (or, following termination effect that the board of directors of the Administrative Services AgreementCompany has determined and believes that the Merger is in the best interests of the Company’s stockholders; (iii) the board of directors of the Company fails to reaffirm the Company Board Recommendation, calculated or fails to reaffirm its determination that the Merger is in good faith by the Ceding best interests of the Company’s stockholders, within five Business Days after Parent requests in writing that such recommendation or determination be reaffirmed; (iv) the board of directors of the Company shall have approved, endorsed, recommended or taken a neutral position with respect to any Acquisition Proposal; (v) the Company shall have entered into any letter of intent or similar document or any Contract relating to any Acquisition Proposal (other than a confidentiality agreement that is entered into in accordance with Section 5.3(a)); (vi) a tender or exchange offer relating to securities of the Company shall have been commenced and furnished the Company shall not have sent to the Reinsurer in a report) (the “Security Funding Report”) no later than its securityholders, within ten (10) Business Days following after the end commencement of such calendar quarter (tender or exchange offer, a statement disclosing that the “Security Funding Reporting Date”) and (ii) the Statutory Book Value or, following the occurrence and during the continuation of a Triggering Event, the Fair Market Value of the Eligible Assets held in the Trust Account as of the end Company recommends rejection of such calendar quarter as furnished by the Reinsurer tender or exchange offer; (vii) an Acquisition Proposal is publicly announced, disclosed or commenced or submitted, made or publicly communicated to the Ceding Company in a report no later than the Security Funding Reporting Date. The amount Company’s board of security required to be held in the Trust Account shall be adjusted as follows: So long as no Triggering Event has occurred and is continuing: If the aggregate Statutory Book Value of the Eligible Assets held in the Trust Account as of the end of any calendar quarter is less than the Required Balance, calculated based on the Security Funding Report for such calendar quarter, then the Reinsurer shall, no later than [REDACTED] calendar days following the Security Funding Reporting Date for such quarter, transfer additional Eligible Assets to the Trust Account so that the aggregate Statutory Book Value of the Eligible Assets held in the Trust Account is not less than the Required Balance; and If the aggregate Statutory Book Value of the Eligible Assets held in the Trust Account as of the end of any calendar quarter exceeds the Required Balance, calculated based on the Security Funding Report for such calendar quarter, then the Reinsurer shall have the right to withdraw such excess in accordance with the procedures set forth in the Trust Agreement. If the Reinsurer seeks to cause the Trustee to substitute new Eligible Assets for Eligible Assets held in the Trust Account, which new Eligible Assets have an aggregate Statutory Book Value at least equal to the aggregate Statutory Book Value of the substituted Eligible Assets held in the Trust Account immediately prior to such substitution directors and the aggregate Fair Market Value of such new Eligible Assets is at least equal to the lesser of Company (A) fails to comply with the aggregate Statutory Book Value requirements of such new Eligible Assets and Section 5.3 or (B) otherwise fails to actively oppose such Acquisition Proposal; (viii) any Person or “group” (as defined in the aggregate Fair Market Value Exchange Act and the rules promulgated thereunder) of Persons directly or indirectly acquires or agrees to acquire, or discloses an intention to acquire, beneficial or record ownership of securities representing more than 10% of the substituted Eligible Assets, then outstanding securities of any class of voting securities of the Reinsurer shall have the right to cause Company (and shall only cause) the Trustee to effect such substitution in accordance with the procedures set forth in the Trust Agreement. During the continuation of a “Stock Purchase Triggering Event: If the aggregate Fair Market Value of the Eligible Assets held in the Trust Account as of the end of any calendar quarter is less than the Required Balance, calculated based on the Security Funding Report for such calendar quarter, then the Reinsurer shall, no later than three ”); (3ix) Business Days following the Security Funding Reporting Date for such calendar quarter, transfer additional Eligible Assets to the Trust Account so that the aggregate Fair Market Value of the Eligible Assets held in the Trust Account is not less than the Required Balance; and If the aggregate Fair Market Value of the Eligible Assets held in the Trust Account as of the end of any calendar quarter (x) if no RBC Event is continuing, exceeds [REDACTED] of, and (y) if an RBC Event is continuing, exceeds one hundred percent (100%) of, the Required Balance, calculated based on the Security Funding Report for such calendar quarter, then the Reinsurer shall have the right to seek consent from the Ceding Company to withdraw such excess in accordance with the procedures set forth in the Trust Agreement, which consent shall be provided by the Ceding Company as promptly as reasonably practicable. If the Reinsurer seeks to cause the Trustee to substitute new Eligible Assets for Eligible Assets held in the Trust Account, which new Eligible Assets have an aggregate Fair Market Value at least equal to the aggregate Fair Market Value of the substituted Eligible Assets held in the Trust Account immediately prior to such substitution, then the Reinsurer shall have the right to cause the Trustee to effect such substitution with the prior written consent of the Ceding Company, which consent the Ceding Company shall deliver as promptly as reasonably practicable following the Ceding Company’s confirmation of the aggregate Fair Market Values of the Eligible Assets to be substituted and being replaced. In addition, as soon as reasonably practicable, and no later than (i) [REDACTED] calendar days after the Reinsurer becomes aware of the occurrence of a Triggering Event (other than a Reserve Credit Event) and (ii) the earlier of (x) [REDACTED] calendar days after the Reinsurer becomes aware of the occurrence of a Reserve Credit Event and (y) the fiscal quarter- or fiscal year-end following the date on which the Reinsurer becomes aware of the occurrence of the Reserve Credit Event, (in each case of (i) and (ii), unless the Ceding Company shall agree to a longer period, then by the end of such longer period), the Reinsurer shall (i) substitute any assets in the Trust Account that are not Eligible Assets for assets that are Eligible Assets, and (ii) deposit additional assets consisting of Eligible Assets in the Trust Account sufficient to ensure that the aggregate Fair Market Value of the Eligible Assets in the Trust Account is not less than the Required Balance as of the last day of the immediately preceding calendar quarter. The report required to be delivered by the Reinsurer as described in Section 4.8(a) shall include a listing of each asset in the Trust Account and the Statutory Book Value or, following the occurrence and during the continuance of a Triggering Event, the Fair Market Value, of each such asset as of the end of the relevant calendar quarter. In addition, no later than [REDACTED] calendar days following the end of each calendar quarter, the Reinsurer shall provide to the Ceding Company a report indicating if any of the assets in the Security Funding Report for such calendar quarter are not an Eligible Asset and including reasonable and customary backup material demonstrating that the assets in Trust Account, together with the assets in the Protective Life and Annuity Trust Account, are in compliance with the investment guidelines set forth on Schedule C. In the event that the Ceding Company disagrees with the calculation Acquired Companies or any Representative of any of the Fair Market Value or the Statutory Book Value, as applicable, of any Eligible Asset or whether any asset is an Eligible Asset as set forth Acquired Companies shall have breached in any such report, the Ceding Company may deliver written notice to the Reinsurer of such disagreement and the Parties shall attempt material respect or taken any action inconsistent in good faith to resolve such disagreement. Any resolution agreed to in writing by the Parties shall be final and binding upon the Parties. If the Parties are unable to resolve any disagreement as to the calculation material respect with any of the Fair Market Value or the Statutory Book Value, as applicable, of any Eligible Asset or whether any asset is an Eligible Asset within [REDACTED] Business Days after the Ceding Company delivers written notice of any such disagreement to the Reinsurer, the Parties shall jointly request the Independent Accountant to determine the Fair Market Value or the Statutory Book Value, as applicable, of the disputed Eligible Asset or whether the disputed asset is an Eligible Asset as of the relevant date in accordance with the procedures provisions set forth in Section 2.12 5.3; or (x) the board of directors of the Master Transaction AgreementCompany shall not have submitted this Agreement to the Company Stockholders, mutatis mutandis. The Independent Accountant’s determination whether or not the board of directors of the Fair Market Value Company at any time changes, withdraws, or modifies the Statutory Book Value, as applicable, of the disputed Eligible Asset or whether the disputed asset is an Eligible Asset shall be final and binding upon the Parties. The fees, costs and expenses associated with the Independent Accountant’s determination shall be allocated between the Ceding Company and the Reinsurer in accordance with the Independent Accountant’s judgment as to the relative merits of the Parties’ proposals in respect of the dispute. After a final and binding resolution of any dispute described in this Section 4.8(c) is reached, the Parties agree to make any necessary adjustments under Section 4.8(a) so that the aggregate Fair Market Value or the Statutory Book Value, as applicable, of the Eligible Assets held in the Trust Account is not less than the amount required pursuant to Section 4.8(a)(i) or (a)(ii), as applicableBoard Recommendation.

Triggering Event. The Parties acknowledge (a) Notwithstanding anything in this Agreement to the contrary, in the event that the Beneficiary delivers a written certification substantially in the form attached hereto as Exhibit C (a “Triggering Event Certification”) to the Grantor and agree that, upon the Trustee of the occurrence of a Triggering EventEvent under the Coinsurance Agreement, certain upon receipt of such certification by the Trustee, the provisions of this Agreement Sections 2(a), 2(b) and 3(c) hereof shall no longer be effective and shall be replaced with the Trust Agreement shall cease to be effectivebelow provisions, and other provisions shall automatically be effectiveeffective immediately without any further action by any party, so long until such time as the Beneficiary notifies the Trustee that such Triggering Event continuesis no longer in force: (i) Section 2(a) shall be replaced with the following: Notwithstanding any other provision of this Agreement, as described herein and in the Trust Agreement. Provisions that will automatically become modified upon Beneficiary shall have the occurrence and during the continuation of a Triggering Event are as follows: (a) the valuation of Eligible unconditional right to withdraw Assets in valued at Fair Market Value from the Trust Account under Section 4.2(b) at any time and all other applicable sections from time to time, without notice to Grantor upon the delivery of this Agreement shall be modified a written notice from Statutory Book Value the Beneficiary; Authorized Officers to Fair Market Value, (b) Section 4.7(a) governing the use and application of assets Trustee substantially in the Trust Account by form attached hereto as Exhibit B-1 (a “Beneficiary Withdrawal Notice”), for any of the Ceding Company prior to a Triggering Event shall not apply, (c) purposes set forth in Section 4.7(b) governing the use and application of assets in the Trust Account by the Ceding Company during the continuance of a Triggering Event shall apply, (d) Section 4.8(a)(i) governing the adjustment of the security held in the Trust Account prior to a Triggering Event shall not applyCoinsurance Agreement, and (e) Section 4.8(a)(ii) governing the adjustment of the security held in the Trust Account following a Triggering Event shall apply. Withdrawal of Assets assets withdrawn from the Trust Account. So long as no Triggering Event has occurred and is continuing, the Ceding Company and the Reinsurer agree that the assets maintained in the Trust Account may be withdrawn utilized and applied by the Ceding Company Beneficiary (or any successor by operation of law of the Ceding CompanyBeneficiary, including, without limitation, including any liquidator, rehabilitator, receiver or conservator of the Ceding Company), without diminution because of any insolvency, rehabilitation, conservatorship or comparable proceeding (an “Insolvency”) insolvency on the part of the Ceding Company Beneficiary or the Reinsurer, only in accordance with the terms of the Trust Agreement, (i) Grantor. The Beneficiary need not present any statement or document other than a Beneficiary Withdrawal Notice in order to pay withdraw any Assets; nor is such right of withdrawal or reimburse the Ceding Company for any undisputed amounts due from the Reinsurer under other provision of this Agreement and subject to any conditions or qualifications not yet recovered from the Reinsurer, including any Reinsured Liabilities, Terminal Settlement, or other amounts due under contained in this Agreement, which amounts have not been paid by the Reinsurer within ten (10) calendar days following the Reinsurer’s receipt of a specific written notice thereof, or . (ii) otherwise Section 2(b) shall be replaced with the prior written consent of the Reinsurer. During the continuation of a Triggering Event, the Ceding Company and the Reinsurer agree that the assets maintained in the Trust Account may be withdrawn by the Ceding Company, or any successors by operation of law of the Ceding Company, including without limitation any liquidator, rehabilitator, receiver or conservator of the Ceding Company, without diminution because of Insolvency on the part of the Ceding Company or the Reinsurer, at any time (notwithstanding any other provisions of this Agreement or the other Transaction Agreements) without notice or consent from the Reinsurer, but only for one or more of the following purposes: to pay or reimburse the Ceding Company for the Reinsurer’s share of premiums returned, but not yet recovered from the Reinsurer, to the Contractholders or Insureds of the Reinsured Contracts reinsured hereunder because of cancellations of the Reinsured Contracts or certificates issued thereunder; to pay or reimburse the Ceding Company for the Reinsurer’s share of surrenders and benefits or losses payable by the Ceding Company pursuant to the provisions of the Reinsured Contracts reinsured hereunder; to pay or reimburse the Ceding Company for any other amounts necessary to secure the credit or reduction from liability for reinsurance taken by the Ceding Company hereunder; and for any other purpose required under the credit for reinsurance regulations of the Ceding Company Domiciliary State in order to secure the credit or reduction from liability for reinsurance taken by the Ceding Company hereunder. The Ceding Company shall promptly return to the Trust Account assets withdrawn in excess of the actual amounts required for Section 4.7 (a) and (b) above, together with interest on such excess withdrawn amounts at the Interest Rate for the period that such assets are held by the Ceding Company. Until such excess amounts are so returned to the Trust Account, any such amounts shall at all times be held by the Ceding Company or its successors in interest by operation of law, including, without limitation, any liquidator, rehabilitator, receiver or conservator of the Ceding Company, in trust for the benefit of the Reinsurer and be maintained in a segregated account, separate and apart from any assets of the Ceding Company for the sole purpose of funding the reimbursements and payments described in Section 4.7(a) or (b), as applicable. Adjustment of Security and Withdrawals. The amount of security required to be provided by the Reinsurer hereunder shall be adjusted following the end of each calendar quarter ending after the Effective Time based on (i) the Required Balance as of the end of such calendar quarter calculated in good faith by the Reinsurer as Administrator and furnished to the Ceding Company in a report (or, following termination of the Administrative Services Agreement, calculated in good faith by the Ceding Company and furnished to the Reinsurer in a report) (the “Security Funding Report”) no later than ten (10) Business Days following the end of such calendar quarter (the “Security Funding Reporting Date”) and (ii) the Statutory Book Value or, following the occurrence and during the continuation of a Triggering Event, the Fair Market Value of the Eligible Assets held in the Trust Account as of the end of such calendar quarter as furnished by the Reinsurer to the Ceding Company in a report no later than the Security Funding Reporting Date. The amount of security required to be held in the Trust Account shall be adjusted as follows: So long as no Triggering Event has occurred and is continuing: If the aggregate Statutory Book Value of the Eligible Assets held in the Trust Account as of the end of any calendar quarter is less than the Required Balance, calculated based on the Security Funding Report for such calendar quarter, then the Reinsurer shall, no later than [REDACTED] calendar days following the Security Funding Reporting Date for such quarter, transfer additional Eligible Assets to the Trust Account so that the aggregate Statutory Book Value of the Eligible Assets held in the Trust Account is not less than the Required Balance; and If the aggregate Statutory Book Value of the Eligible Assets held in the Trust Account as of the end of any calendar quarter exceeds the Required Balance, calculated based on the Security Funding Report for such calendar quarter, then the Reinsurer shall have the right to withdraw such excess in accordance with the procedures set forth in the Trust Agreement. If the Reinsurer seeks to cause the Trustee to substitute new Eligible Assets for Eligible Assets held in the Trust Account, which new Eligible Assets have an aggregate Statutory Book Value at least equal to the aggregate Statutory Book Value of the substituted Eligible Assets held in the Trust Account immediately prior to such substitution and the aggregate Fair Market Value of such new Eligible Assets is at least equal to the lesser of (A) the aggregate Statutory Book Value of such new Eligible Assets and (B) the aggregate Fair Market Value of the substituted Eligible Assets, then the Reinsurer shall have the right to cause (and shall only cause) the Trustee to effect such substitution in accordance with the procedures set forth in the Trust Agreement. During the continuation of a Triggering Eventfollowing: If the aggregate Fair Market Value of the Eligible Assets held in the Trust Account as of at the end of any calendar quarter is less than Accounting Period exceeds the Required BalanceBalance at the end of such Accounting Period, calculated based on the Security Funding Report for such calendar quarterGrantor may, then with the Reinsurer shallwritten consent of the Beneficiary (which shall not be unreasonably withheld, no later than three (3) Business Days following the Security Funding Reporting Date for such calendar quarterdelayed or conditioned), transfer additional Eligible withdraw Assets to from the Trust Account so in an amount not to exceed such excess, by delivering a written notice from the Grantor Authorized Officers substantially in the form attached hereto as Exhibit B-2 (a “Grantor Withdrawal Notice”) to the Trustee with a copy to the Beneficiary. The Grantor Withdrawal Notice shall specify the invested Assets or cash amount to be withdrawn. Each withdrawal from the Trust Account by the Grantor shall constitute a representation and certification of the Grantor to the Beneficiary that such withdrawal is being made in accordance with the aggregate terms of the Coinsurance Agreement and this Agreement. (iii) Section 3(c) shall be replaced with the following: From time to time, and with the written consent of the Beneficiary (which shall not be unreasonably withheld), the Grantor or its designated Investment Manager may direct the Trustee to substitute Assets, provided, that at the time of such substitution, the withdrawn Assets are replaced with other Eligible Assets having a Fair Market Value at least equal to the Fair Market Value of the Assets withdrawn. The Trustee shall have no responsibility whatsoever to determine the value of such substituted Assets or that such substituted Assets constitute Eligible Assets. (b) Notwithstanding the foregoing, the Trust Account created hereunder shall continue in existence following the occurrence of a Triggering Event. Following the occurrence of a Triggering Event, the Grantor shall ensure that the Assets held in the Trust Account is not less than the Required Balance; and If the aggregate Fair Market Value of the Eligible Assets held in the Trust Account as of the end of any calendar quarter (x) if no RBC Event is continuing, exceeds [REDACTED] of, and (y) if an RBC Event is continuing, exceeds one hundred percent (100%) of, the Required Balance, calculated based on the Security Funding Report for such calendar quarter, then the Reinsurer shall have the right to seek consent from the Ceding Company to withdraw such excess in accordance with the procedures set forth in the Trust Agreement, which consent shall be provided by the Ceding Company as promptly as reasonably practicable. If the Reinsurer seeks to cause the Trustee to substitute new Eligible Assets for Eligible Assets held in the Trust Account, which new Eligible Assets have an aggregate Fair Market Value at least equal to the aggregate Fair Market Value of the substituted Eligible Assets held in the Trust Account immediately prior to such substitution, then the Reinsurer shall have the right to cause the Trustee to effect such substitution with the prior written consent of the Ceding Company, which consent the Ceding Company shall deliver as promptly as reasonably practicable following the Ceding Company’s confirmation of the aggregate Fair Market Values of the Eligible Assets to be substituted and being replaced. In addition, as soon as reasonably practicable, and no later than (i) [REDACTED] calendar days after the Reinsurer becomes aware of the occurrence of a Triggering Event (other than a Reserve Credit Event) and (ii) the earlier of (x) [REDACTED] calendar days after the Reinsurer becomes aware of the occurrence of a Reserve Credit Event and (y) the fiscal quarter- or fiscal year-end following the date on which the Reinsurer becomes aware of the occurrence of the Reserve Credit Event, (in each case of (i) and (ii), unless the Ceding Company shall agree to a longer period, then by the end of such longer period), the Reinsurer shall (i) substitute any assets in the Trust Account that are not Eligible Assets for assets that are Eligible Assets, and (ii) deposit additional assets consisting of Eligible Assets in the Trust Account sufficient to ensure that the aggregate Fair Market Value of the Eligible Assets in the Trust Account is not less than the Required Balance as of the last day of the immediately preceding calendar quarter. The report required to be delivered by the Reinsurer as described in Section 4.8(a) shall include a listing of each asset in the Trust Account and the Statutory Book Value or, following the occurrence and during the continuance of a Triggering Event, the Fair Market Value, of each such asset as of the end of the relevant calendar quarter. In addition, no later than within [REDACTED10 (ten)] calendar days following the end of each calendar quarter, the Reinsurer shall provide to the Ceding Company a report indicating if any of the assets in the Security Funding Report for such calendar quarter are not an Eligible Asset and including reasonable and customary backup material demonstrating that the assets in Trust Account, together with the assets in the Protective Life and Annuity Trust Account, are in compliance with the investment guidelines set forth on Schedule C. In the event that the Ceding Company disagrees with the calculation of the Fair Market Value or the Statutory Book Value, as applicable, of any Eligible Asset or whether any asset is an Eligible Asset as set forth in any such report, the Ceding Company may deliver written notice to the Reinsurer of such disagreement and the Parties shall attempt in good faith to resolve such disagreement. Any resolution agreed to in writing by the Parties shall be final and binding upon the Parties. If the Parties are unable to resolve any disagreement as to the calculation of the Fair Market Value or the Statutory Book Value, as applicable, of any Eligible Asset or whether any asset is an Eligible Asset within [REDACTED] Business Days after the Ceding Company delivers written notice of any such disagreement to the Reinsurer, the Parties shall jointly request the Independent Accountant to determine the Fair Market Value or the Statutory Book Value, as applicable, of the disputed Eligible Asset or whether the disputed asset is an Eligible Asset as of the relevant date in accordance with the procedures set forth in Section 2.12 of the Master Transaction Agreement, mutatis mutandis. The Independent Accountant’s determination of the Fair Market Value or the Statutory Book Value, as applicable, of the disputed Eligible Asset or whether the disputed asset is an Eligible Asset shall be final and binding upon the Parties. The fees, costs and expenses associated with the Independent Accountant’s determination shall be allocated between the Ceding Company and the Reinsurer in accordance with the Independent Accountant’s judgment as to the relative merits of the Parties’ proposals in respect of the dispute. After a final and binding resolution of any dispute described in this Section 4.8(c) is reached, the Parties agree to make any necessary adjustments under Section 4.8(a) so that the aggregate Fair Market Value or the Statutory Book Value, as applicable, of the Eligible Assets held in the Trust Account is not less than the amount required pursuant to Section 4.8(a)(i) or (a)(ii), as applicableTriggering Event.

Triggering Event. The Parties acknowledge and agree thatFor purposes of this subsection, upon the occurrence of a “Triggering Event, certain provisions of this Agreement and the Trust Agreement ” shall cease to be effective, and other provisions shall automatically be effective, so long as such Triggering Event continues, as described herein and in the Trust Agreement. Provisions that will automatically become modified upon the occurrence and during the continuation of a Triggering Event are as follows: (a) the valuation of Eligible Assets in the Trust Account under Section 4.2(b) and all other applicable sections of this Agreement shall be modified from Statutory Book Value to Fair Market Value, (b) Section 4.7(a) governing the use and application of assets in the Trust Account by the Ceding Company prior to a Triggering Event shall not apply, (c) Section 4.7(b) governing the use and application of assets in the Trust Account by the Ceding Company during the continuance of a Triggering Event shall apply, (d) Section 4.8(a)(i) governing the adjustment of the security held in the Trust Account prior to a Triggering Event shall not apply, and (e) Section 4.8(a)(ii) governing the adjustment of the security held in the Trust Account following a Triggering Event shall apply. Withdrawal of Assets from the Trust Account. So long as no Triggering Event has occurred and is continuing, the Ceding Company and the Reinsurer agree that the assets maintained in the Trust Account may be withdrawn by the Ceding Company or any successor by operation of law of the Ceding Company, including, without limitation, any liquidator, rehabilitator, receiver or conservator of the Ceding Company, without diminution because of any insolvency, rehabilitation, conservatorship or comparable proceeding (an “Insolvency”) on the part of the Ceding Company or the Reinsurer, only in accordance with the terms of the Trust Agreement, (i) in order to pay or reimburse the Ceding Company for any undisputed amounts due from the Reinsurer under this Agreement and not yet recovered from the Reinsurer, including any Reinsured Liabilities, Terminal Settlement, or other amounts due under this Agreement, which amounts have not been paid by the Reinsurer within ten (10) calendar days following the Reinsurer’s receipt of a specific written notice thereof, or (ii) otherwise with the prior written consent of the Reinsurer. During the continuation of a Triggering Event, the Ceding Company and the Reinsurer agree that the assets maintained in the Trust Account may be withdrawn by the Ceding Company, or any successors by operation of law of the Ceding Company, including without limitation any liquidator, rehabilitator, receiver or conservator of the Ceding Company, without diminution because of Insolvency on the part of the Ceding Company or the Reinsurer, at any time (notwithstanding any other provisions of this Agreement or the other Transaction Agreements) without notice or consent from the Reinsurer, but only for one or more of the following purposes: to pay or reimburse the Ceding Company for the Reinsurer’s share of premiums returned, but not yet recovered from the Reinsurer, to the Contractholders or Insureds of the Reinsured Contracts reinsured hereunder because of cancellations of the Reinsured Contracts or certificates issued thereunder; to pay or reimburse the Ceding Company for the Reinsurer’s share of surrenders and benefits or losses payable by the Ceding Company pursuant to the provisions of the Reinsured Contracts reinsured hereunder; to pay or reimburse the Ceding Company for any other amounts necessary to secure the credit or reduction from liability for reinsurance taken by the Ceding Company hereunder; and for any other purpose required under the credit for reinsurance regulations of the Ceding Company Domiciliary State in order to secure the credit or reduction from liability for reinsurance taken by the Ceding Company hereunder. The Ceding Company shall promptly return to the Trust Account assets withdrawn in excess of the actual amounts required for Section 4.7 (a) and (b) above, together with interest on such excess withdrawn amounts at the Interest Rate for the period that such assets are held by the Ceding Company. Until such excess amounts are so returned to the Trust Account, any such amounts shall at all times be held by the Ceding Company or its successors in interest by operation of law, including, without limitation, any liquidator, rehabilitator, receiver or conservator of the Ceding Company, in trust for the benefit of the Reinsurer and be maintained in a segregated account, separate and apart from any assets of the Ceding Company for the sole purpose of funding the reimbursements and payments described in Section 4.7(a) or (b), as applicable. Adjustment of Security and Withdrawals. The amount of security required to be provided by the Reinsurer hereunder shall be adjusted following the end of each calendar quarter ending after the Effective Time based on (i) the Required Balance as of the end of such calendar quarter calculated in good faith by the Reinsurer as Administrator and furnished to the Ceding Company in a report (or, following termination of the Administrative Services Agreement, calculated in good faith by the Ceding Company and furnished to the Reinsurer in a report) (the “Security Funding Report”) no later than ten (10) Business Days following the end of such calendar quarter (the “Security Funding Reporting Date”) and (ii) the Statutory Book Value or, following the occurrence and during the continuation of a Triggering Event, the Fair Market Value of the Eligible Assets held in the Trust Account as of the end of such calendar quarter as furnished by the Reinsurer to the Ceding Company in a report no later than the Security Funding Reporting Date. The amount of security required to be held in the Trust Account shall be adjusted as follows: So long as no Triggering Event has occurred and is continuing: If the aggregate Statutory Book Value of the Eligible Assets held in the Trust Account as of the end of any calendar quarter is less than the Required Balance, calculated based on the Security Funding Report for such calendar quarter, then the Reinsurer shall, no later than [REDACTED] calendar days following the Security Funding Reporting Date for such quarter, transfer additional Eligible Assets to the Trust Account so that the aggregate Statutory Book Value of the Eligible Assets held in the Trust Account is not less than the Required Balance; and If the aggregate Statutory Book Value of the Eligible Assets held in the Trust Account as of the end of any calendar quarter exceeds the Required Balance, calculated based on the Security Funding Report for such calendar quarter, then the Reinsurer shall have the right to withdraw such excess in accordance with the procedures set forth in the Trust Agreement. If the Reinsurer seeks to cause the Trustee to substitute new Eligible Assets for Eligible Assets held in the Trust Account, which new Eligible Assets have an aggregate Statutory Book Value at least equal to the aggregate Statutory Book Value of the substituted Eligible Assets held in the Trust Account immediately prior to such substitution and the aggregate Fair Market Value of such new Eligible Assets is at least equal to the lesser of mean either (A) the aggregate Statutory Book Value of such new Eligible Assets and (B) the aggregate Fair Market Value of the substituted Eligible Assetsthat, then the Reinsurer shall have the right to cause (and shall only cause) the Trustee to effect such substitution in accordance with the procedures set forth in the Trust Agreement. During the continuation of a Triggering Event: If the aggregate Fair Market Value of the Eligible Assets held in the Trust Account as of the end of any calendar quarter is less than the Required Balance, calculated based on the Security Funding Report for such calendar quarter, then the Reinsurer shall, no later than three (3) Business Days following the Security Funding Reporting Date for such calendar quarter, transfer additional Eligible Assets to the Trust Account so that the aggregate Fair Market Value of the Eligible Assets held in the Trust Account is not less than the Required Balance; and If the aggregate Fair Market Value of the Eligible Assets held in the Trust Account as of the end of any calendar quarter (x) if no RBC Event is continuing, exceeds [REDACTED] of, and (y) if an RBC Event is continuing, exceeds one hundred percent (100%) of, the Required Balance, calculated based on the Security Funding Report for such calendar quarter, then the Reinsurer shall have the right to seek consent from the Ceding Company to withdraw such excess in accordance with the procedures set forth in the Trust Agreement, which consent shall be provided by the Ceding Company as promptly as reasonably practicable. If the Reinsurer seeks to cause the Trustee to substitute new Eligible Assets for Eligible Assets held in the Trust Account, which new Eligible Assets have an aggregate Fair Market Value at least equal to the aggregate Fair Market Value of the substituted Eligible Assets held in the Trust Account immediately prior to such substitution, then the Reinsurer shall have the right to cause the Trustee to effect such substitution with the prior written consent of the Ceding Company, which consent the Ceding Company shall deliver as promptly as reasonably practicable following the Ceding Company’s confirmation of the aggregate Fair Market Values of the Eligible Assets to be substituted and being replaced. In addition, as soon as reasonably practicable, and no later than (i) [REDACTED] calendar days after the Reinsurer becomes aware of the occurrence of a Triggering Event (other than a Reserve Credit Event) and (ii) the earlier of (x) [REDACTED] calendar days after the Reinsurer becomes aware of the occurrence of a Reserve Credit Event and (y) the fiscal quarter- or fiscal year-end following the date on which the Reinsurer becomes aware of the occurrence of the Reserve Credit Event, (in each case of (i) and (ii), unless the Ceding Company shall agree to a longer period, then by the end of such longer period), the Reinsurer shall (i) substitute any assets in the Trust Account that are not Eligible Assets for assets that are Eligible Assets, and (ii) deposit additional assets consisting of Eligible Assets in the Trust Account sufficient to ensure that the aggregate Fair Market Value of the Eligible Assets in the Trust Account is not less than the Required Balance as of the last day of the immediately preceding any calendar quarter. The report required , Alliance Bank is no longer considered to be delivered by well capitalized under the Reinsurer as described in Section 4.8(a) shall include a listing of each asset in the Trust Account and the Statutory Book Value or, following the occurrence and during the continuance of a Triggering Event, the Fair Market Value, of each such asset as prompt corrective action rules of the end Federal Deposit Insurance Corporation (“FDIC”), as disclosed by Alliance Bank’s Report of the relevant calendar quarter. In additionCondition and Income (“Call Report”), no later than [REDACTED] calendar which Alliance Bank shall deliver to Landlord within forty (40) days following the end last day of each calendar quarter, the Reinsurer shall provide or (B) Alliance Bank is delinquent in delivering its Call Report to the Ceding Company Landlord and such failure continues for a report indicating if any period of the assets in the Security Funding Report for such calendar quarter are not an Eligible Asset and including reasonable and customary backup material demonstrating that the assets in Trust Account, together with the assets in the Protective Life and Annuity Trust Account, are in compliance with the investment guidelines set forth on Schedule C. In the event that the Ceding Company disagrees with the calculation of the Fair Market Value or the Statutory Book Value, as applicable, of any Eligible Asset or whether any asset is an Eligible Asset as set forth in any such report, the Ceding Company may deliver ten (10) business days after Landlord’s written notice to the Reinsurer Alliance Bank of such disagreement and the Parties shall attempt in good faith delinquency. Alliance Bank shall, from time to resolve such disagreement. Any resolution agreed to time within ten (10) business days following Landlord’s request, advise Landlord in writing by whether a Triggering Event has occurred and submit to Landlord its most recently submitted Call Report relevant to a determination thereof; provided, however, that Landlord shall not make such requests more than four (4) times in any calendar year. At the Parties time at which the Triggering Event has been cured, the Additional Security Deposit shall be final returned to Tenant. It is acknowledged and binding upon agreed that: (1) the Parties. If reporting obligations of Alliance Bank specified in this subsection (i) shall be and remain the Parties are unable direct obligations of Alliance Bank, notwithstanding any assignment by Alliance Bank of its interest in this Lease; (2) the obligation of Tenant hereunder (including any assignee of the interest of Alliance Bank herein) to resolve any disagreement as make the Additional Security Deposit shall be determined by reference to the calculation financial tests regarding Alliance Bank specified above (not those of any assignee Tenant); and (3) without limiting the generality of the Fair Market Value or the Statutory Book Value, as applicable, provisions of any Eligible Asset or whether any asset is an Eligible Asset within [REDACTED] Business Days after the Ceding Company delivers written notice of any such disagreement to the Reinsurer, the Parties shall jointly request the Independent Accountant to determine the Fair Market Value or the Statutory Book Value, as applicable, Paragraph 24(i) of the disputed Eligible Asset or whether the disputed asset is an Eligible Asset as Lease, no assignment by Alliance Bank of the relevant date in accordance with the procedures set forth in Section 2.12 interest of the Master Transaction Agreement, mutatis mutandis. The Independent Accountant’s determination of the Fair Market Value or the Statutory Book Value, as applicable, of the disputed Eligible Asset or whether the disputed asset is an Eligible Asset shall be final and binding upon the Parties. The fees, costs and expenses associated with the Independent Accountant’s determination shall be allocated between the Ceding Company and the Reinsurer in accordance with the Independent Accountant’s judgment as to the relative merits of the Parties’ proposals in respect of the dispute. After a final and binding resolution of any dispute described in this Section 4.8(c) is reached, the Parties agree to make any necessary adjustments under Section 4.8(a) so that the aggregate Fair Market Value or the Statutory Book Value, as applicable, of the Eligible Assets held Tenant in the Trust Account is not less than Lease shall release Alliance Bank of its obligations under the amount required pursuant Lease or alter the primary liability of Tenant to Section 4.8(a)(i) or (a)(ii), as applicablepay the rent and to perform all other obligations to be performed by Tenant under the Lease.