Midwest Holding Inc. (OTCMKTS: MDWT) Files An 8-K Entry into a Material Definitive AgreementItem 1.01 – Entry into a Material Definitive Agreement.
On November 30, 2018, American Life & Security Corp. (“American Life”), a wholly owned subsidiary of Midwest Holding Inc. (“Midwest”), entered into an Assumption and Indemnity Reinsurance Agreement (the “Agreement”) with Unified Life Insurance Company, a Texas domiciled stock insurance company (the “Reinsurer”). The Agreement provides, among other things, as follows:
1. Upon Closing (defined below), and from and after an effective date deemed to be July 1, 2018 (the “Effective Date”), American Life ceded and the Reinsurer agreed to reinsure, on an indemnity reinsurances basis, 50% of the liabilities and obligations under substantially all of American Life’s life, annuity and health policies (the “Policies”).
2. As soon as possible following Closing following the receipt of regulatory approval, the Reinsurer will prepare and deliver a certificate of assumption and other materials to policy holders of American Life in order to effect an assumption of the Policies by the Reinsurer such that all of American Life’s rights and obligations under the Policies arising on and after the Effective Date are completely assumed by the Reinsurer without further indemnification or other obligations of American Life, except for liabilities, claims and obligations incurred before the Effective Date. The Reinsurer is obligated to indemnify American Life against all liabilities and claims and all of its Policy obligations from and after the Effective Date.
3. Closing (the “Closing”) of the Agreement is subject only to regulatory approval of the Nebraska Department of Insurance, which approval has been obtained, and the Agreement is now expected to close in December, 2018.
4. American Life will provide administrative services with respect to the Policies during a transaction period expected to end on or about February 1, 2019, at which time the Reinsurer will assume all administrative functions with respect to the Policies.
5. The Agreement contains customary representations and warranties of each party and certain undertakings by each party following Closing primarily regarding continued cooperation, transaction and administrative services with regard to the Policies.
6. The consideration to be paid by the Reinsurer and to be received by American Life under the Agreement upon Closing is $3,500,000, subject to minor settlement adjustments. At Closing, American Life will transfer the Statutory Reserves and Liabilities, as defined in the Agreement, directly related to the Policies, to the Reinsurer.
The foregoing description of the Agreement is qualified by its actual language, and a copy of the Agreement is filed herewith as Exhibit 10.1 and is incorporated herein by reference in its entirety.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
The following exhibits are filed herewith:
| Exhibit | ||
| No. | Description | |
| 10.1 | Assumption and Indemnity Reinsurance Agreement between American Life & Security Corp. and Unified Life Insurance Company dated November 30, 2018. |
MIDWEST HOLDING INC. Exhibit…To view the full exhibit click here