TAX ALLOCATION AGREEMENT
EXHIBIT
10.3
This
Tax
Allocation Agreement, dated June 1, 2006, between AmTrust Financial Services,
Inc. (“AmTrust”), a Delaware corporation, and Wesco Insurance Company (“Wesco”),
a Delaware corporation.
WITNESSETH
WHEREAS,
AmTrust and Wesco are affiliates;
WHEREAS,
AmTrust and Wesco are part of a consolidated tax filing group (the “Group”) in
accordance with the relevant Internal Revenue Service regulations;
and
WHEREAS,
AmTrust is the agent of Wesco for the purpose of filing the consolidated tax
return on behalf of the Group; and
WHEREAS,
AmTrust and Wesco wish to set forth their obligations to each other as members
of the Group in accordance with Delaware’s insurance laws and
regulations.
NOW,
THEREFORE, AmTrust and Wescp agree as follows:
A. Determination
of Tax Liability
Wesco’s
liability for federal income tax payments or entitlement to federal income
tax
refunds shall be based on the amount of its tax liability or entitlement to
a
refund calculated on a separate return basis.
B. Tax
Payments
Wesco
shall remit to AmTrust any amounts determined to be due in accordance with
Section A of this Agreement at such time that the Group is legally obligated
to
make estimated or final tax payments.
C. Tax
Refunds
Upon
receipt, AmTrust shall remit to Wesco that part of any tax refund received
by
the Group that results from tax savings to the Group generated by foreign
credits, investment credits, losses or any loss carry overs available to
Wesco.
D. Scope
This
Agreement shall apply only to the parties’ federal tax liability.
IN
WITNESS WHEREOF, the parties have caused this Agreement to be executed on the
date set forth above.
By:_________________________________
Xxxxx
X.
Xxxxxxx, President
WESCO
INSURANCE COMPANY
By:_________________________________
Xxxxx
X.
Xxxxxxx, President
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