Addendum No. 1 to Quota Share Reinsurance Agreement between Tower Insurance Company of New York and Reinsurers

Summary

This addendum amends the original Quota Share Reinsurance Agreement between Tower Insurance Company of New York and several reinsurers, including Tokio Millennium Re Ltd., Hannover Reinsurance (Ireland) Limited, and E+S Reinsurance (Ireland) Limited. Effective July 1, 2004, it changes the definition of "Cession Percentage," allowing the company to adjust the percentage of business ceded to reinsurers under certain financial conditions. All other terms of the original agreement remain unchanged.

EX-10.32 8 b331754_ex10-32.txt Exhibit 10.32 ADDENDUM NO. 1 TO THE QUOTA SHARE REINSURANCE AGREEMENT EFFECTIVE JANUARY 1, 2004 (HEREINAFTER REFERRED TO AS THE "ORIGINAL AGREEMENT") BETWEEN TOWER INSURANCE COMPANY OF NEW YORK (HEREINAFTER REFERRED TO AS THE "COMPANY") AND THE REINSURERS SUBSCRIBING THEIR RESPECTIVE INTERESTS AND LIABILITES AGREEMENTS ATTACHED HERETO (HEREINAFTER REFERRED TO AS THE "REINSURERS") WHEREAS, the Reinsurers and the Company are parties to the Original Agreement. NOW THEREFORE, effective July 1, 2004, the parties hereto hereby agree to amend the Original Agreement as follows: ARTICLE 7, DEFINITIONS - Definition A shall be deleted in its entirety and replaced with the following revised Definition A: "A. "Cession Percentage" as used in this Agreement shall be 60% (sixty percent) for the new and renewal Business Covered written during the period January 1, 2004 through December 31, 2004, both days inclusive. However, if the Company has increased its December 31, 2003 Statutory Surplus by more than 20% (twenty percent) on or before December 31, 2004, the Company may elect to change the Cession Percentage, effective as of October 1, 2004, to any amount that is not less than the minimum cession percentage of 25% (twenty-five percent) and not greater than 60% (sixty percent) by providing the Reinsurers with written notice of the Company's election of such new Cession Percentage amount by no later than December 31, 2004." All other terms and conditions of the Original Agreement remain unchanged. In Witness Whereof, the parties hereto have caused this Addendum No.1 to be executed by their duly authorized representatives. Signed for and on behalf of Tower Insurance Company of New York: By: /s/ Marina Contiero ----------------------------------------------------------------------- Title: Vice President ----------------------------------------------------------------------- Date: September 14, 2004 ----------------------------------------------------------------------- Signed for and on behalf of Tokio Millennium Re Ltd. for its 33.333% (thirty three point three three three percent) participation of the terms and conditions of the Original Agreement By: /s/ Unknown ----------------------------------------------------------------------- Title: Senior Underwriting Officer ----------------------------------------------------------------------- Date: September 14, 2004 ----------------------------------------------------------------------- Signed for and on behalf of Hannover Reinsurance (Ireland) Limited for an 80% (eighty percent) share of a 33.334% (thirty three point three three four percent) their participation of the terms and conditions herein. By: /s/ David Olagrier ----------------------------------------------------------------------- Title: Underwriter ----------------------------------------------------------------------- Date: September 15, 2004 ----------------------------------------------------------------------- Signed for and on behalf of E+S Reinsurance (Ireland) Limited for a 20% (twenty percent) share of a 33.334% (thirty three point three three four percent) participation of the terms and conditions herein. By: /s/ David Olagrier ----------------------------------------------------------------------- Title: Underwriter ----------------------------------------------------------------------- Date: September 15, 2004 -----------------------------------------------------------------------