Exhibit 10.9
RECAPTURE AND RELEASE AGREEMENT
THIS RECAPTURE AND RELEASE AGREEMENT (the
“Agreement”) is entered into on the date it is fully
executed, and is effective as of November 1, 2007 (the
“Effective Date”), by and between Allianz Life
Insurance Company of North America (Allianz Life), and American
Life and Annuity Company, Inc. (the “Reinsurer”)
(Allianz Life and Reinsurer are also referred to herein as the
“parties”).
W I T N E S S E T H:
WHEREAS, the parties entered that certain
reinsurance agreement, effective December 1, 1996 (the
“Reinsurance Agreement”), a copy of which is attached
hereto and incorporated herein, whereby Reinsurer reinsured a quota
share of certain risks incurred by Allianz Life for annuity
products, all as set forth in the Reinsurance Agreement;
and
WHEREAS, the Reinsurer is in the process of
liquidating its assets and liabilities and as part of that process,
and for other reasons, the parties desire to terminate the
Reinsurance Agreement by a recapture by Allianz Life of all risk,
and a full and final settlement and commutation of all obligations
and liabilities known and unknown, associated with the Reinsurance
Agreement.
NOW, THEREFORE, in consideration of the recitals
above, and of the promises contained below, and for other
sufficient consideration received by the parties, the parties agree
that:
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1.
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As of the Effective Date, the parties agree and deem
that the amount of $4,953,880 represents the sum of (i) funds
withheld under the Reinsurance Agreement (the “Funds
Withheld”) and (ii) the present value of all other known and
unknown, current and future, obligations and liabilities of Allianz
Life to the Reinsurer (in total, the “Allianz
Liabilities”) . The parties also agree and deem that the
amount of $5,250,705 represents the sum of (i) a surrender benefit
equal to the surrender value of each policy reinsured and (ii) all
other known and unknown, current and future, obligations and
liabilities of the Reinsurer to Allianz Life pursuant to the
Reinsurance Agreement (in total, the “Reinsurer
Liabilities”).
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2.
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The parties agree to net Allianz Liabilities and
Reinsurer Liabilities in a payment of $296,825 by the Reinsurer to
Allianz Life and that Allianz Life will take over full unencumbered
ownership of the Funds Withheld as of the Effective Date.
Additionally, as of the Effective Date, Allianz Life will recapture
the risk ceded under the Reinsurance Agreement, and the Reinsurance
Agreement terminates.
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3.
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Each party understands and agrees that premium,
claim, investment and other activities on products subject to the
Reinsurance Agreement (i) may be incurred prior
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