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1 <br /> <br /> 3 <br /> <br /> 5 <br /> <br /> 7 <br /> <br /> 9 <br /> <br /> 11 <br /> <br />13 <br /> <br /> 15 <br /> <br /> 17 <br /> <br /> 19 <br /> <br />21 <br /> <br />23 <br /> <br />25 <br /> <br /> 27 <br /> <br /> 29 <br /> <br /> 31 <br /> <br /> 33 <br /> <br /> 35 <br /> <br /> 37 <br /> <br /> 39 <br /> <br /> 41 <br /> <br /> 43 <br /> <br /> 45 <br /> <br /> 47 <br /> <br /> 49 <br /> <br />is less than the Reserve Requirement on the April 15 <br />immediately preceding the Basic Premium Payment Date. <br /> <br /> (d) Administrative Premium. Each Participant shall pay to <br />the Authority as Administrative Premium such amounts as shall <br />be required for the payment of the Participant's Pure Premium <br />Proportion of all administrative costs of the Authority <br />relating to the Coverage or the Bonds, including without <br />limitation all expenses (including counsel fees but not <br />including Defense Costs as defined in the Memorandum), <br />compensation and indemnification of the Trustee under the <br />Indenture, taxes or fees of any sort whatsoever payable by the <br />Authority as a result of its undertaking of the transactions <br />contemplated herein or in ~he Indenture, fees of any Actuary, <br />Qualified Claims Auditor, auditors, accountants, insurance <br />brokers, or attorneys, and all other necessary administrative <br />costs of the Authority or charges required to be paid by it in <br />order to administer the self-insurance program described in <br />this Agreement, or to comply with the terms of the Bonds or of <br />the Indenture or to defend the Authority and its members <br />against any actions or suits or sums in connection herewith. <br /> <br /> (e) Pure Premium. Pure Premium shall be calculated in the <br />following manner. With respect to each Coverage Period <br />commencing on or after July 1, 1989, the Authority shall retain <br />an Actuary to determine and prepare a report to be delivered to <br />the Authority and the Trustee by the February 1 preceding the <br />beginning of such Coverage Period. Such report shall set forth <br />the rates ("Pure Premium Rates") per $1000 of Payroll required <br />to fund the expected losses and allocated loss adjustment <br />expense for the layer of Coverage from each Participant's <br />Self-Insured Retention to $5 million per occurrence in the <br />first Risk Sharing Pool and from $5 million to $10 million per <br />occurrence for Participants in the second Risk Sharing Pool for <br />each of the next three Coverage Periods. Such Pure Premium <br />Rates shall be determined by the Actuary in such a manner that <br />the resulting Total Pure Premium shall be an estimate by the <br />Actuary of the amount of funds to be deposited in the Claims <br />Payment Fund such that the deposit, along with anticipated <br />investment income not allocable to the Principal and Interest <br />Fund (pursuant to Section 3.03 of the Indenture), equals the <br />expected value of all pooled losses up to $10 million per <br />occurrence arising out of events that took place during the <br />Coverage Period. Funding for expected losses above $10 million <br />will not be included in the Pure Premiums but will be funded by <br />Pure Premium Adjustments as Case Reserves are established for <br />Claims. The Actuary shall utilize the general methodologies <br />set forth in Schedule A to calculate Pure Premium Rates, using <br />such Actuary's best professional judgment, and shall certify <br />that such methodologies were used. The methodologies set forth <br /> <br /> 23 <br />2658002/2 <br /> <br /> <br />