EXHIBIT 10.10
TERMINATION AGREEMENT
RELATING TO AN AMENDED AND RESTATED
ADMINISTRATIVE SERVICES AGREEMENT
THIS AGREEMENT is made as of the thirty-first day of December, 2005
among (1) ALLIED WORLD ASSURANCE COMPANY, LTD, a company organized under the
laws of Bermuda (the "Operating Company"), (2) ALLIED WORLD ASSURANCE HOLDINGS,
LTD, a company organized under the laws of Bermuda (the "Holding Company"),
which owns all the outstanding shares of capital stock of the Operating Company,
(3) ALLIED WORLD ASSURANCE HOLDINGS (IRELAND) LTD, a company organized under the
laws of Bermuda ("AWAH IRE"), (4) ALLIED WORLD ASSURANCE COMPANY (U.S.) INC., a
corporation organized under the laws of the State of Delaware ("AWAC U.S."), (5)
NEWMARKET UNDERWRITERS INSURANCE COMPANY, a corporation organized under the laws
of the State of New Hampshire ("NUIC"), (6) ALLIED WORLD ASSURANCE COMPANY
(EUROPE) LIMITED, a corporation organized under the laws of Ireland ("AWAC
Europe"), (7) ALLIED WORLD ASSURANCE COMPANY (REINSURANCE) LIMITED, a
corporation organized under the laws of Ireland ("AWAC Re"), and (8) AMERICAN
INTERNATIONAL COMPANY LIMITED, a company organized under the laws of Bermuda
("AICL").
W I T N E S S E T H
WHEREAS, the Operating Company, the Holding Company and AICL
previously entered into an Administrative Services Agreement, dated November 21,
2001, which was subsequently amended on April 2, 2002, May 3, 2002 and March 1,
2004, and all of the parties hereto further amended and restated such
Administrative Services Agreement on April 1, 2004 (the "Services Agreement");
and
WHEREAS, the Operating Company, the Holding Company, AWAH IRE, AWAC
U.S., NUIC, AWAC Europe and AWAC Re (collectively, the "Companies" and each
individually a "Company") and AICL desire to terminate the Services Agreement
subject to the terms and conditions hereinafter provided.
NOW, THEREFORE, it is agreed as follows:
1. Termination
Notwithstanding the provisions thereof, the Services Agreement shall
terminate as of December 31, 2005 in accordance with the provisions hereof.
2. Termination Fee
The Companies shall pay to AICL a termination fee of $3,000,000.00
to be paid to AICL on or before April 25, 2006 by wire transfer in accordance
with the following wire instructions:
Bank of New York, NY
ABA# 000000000
A.I. Cos. Overseas Pool
A/C#8900504366
3. Representations and Warranties
3.1 Representations and Warranties of AICL.
AICL represents and warrants as of the date hereof as follows: (i)
AICL is a company duly incorporated, validly existing and in good standing under
the laws of Bermuda; (ii) the execution, delivery and performance by AICL of
this Agreement are within AICL's corporate powers, have been duly authorized by
all necessary corporate action; and (iii) this Agreement is the legal, valid and
binding obligation of AICL enforceable against AICL in accordance with its
terms.
3.2 Representations and Warranties of the Companies.
Each of the Companies represents and warrants as of the date hereof
as follows: (i) it is a company duly formed, validly existing and in good
standing under the laws of the jurisdiction of its formation; (ii) the
execution, delivery and performance by it of this Agreement are within its
corporate powers, have been duly authorized by all necessary corporate action;
and (iii) this Agreement is the legal, valid and binding obligation enforceable
against it in accordance with its terms.
4. Books and Records
4.1 All Books and Records which were kept by AICL in connection with the
Operating Company's business managed by AICL shall be and remain the sole
property of the Companies, including all databases maintained by AICL relating
to the Companies' accounting, insurance or other records and whether or not such
data is maintained on information systems owned by AICL or the Companies or
neither. The term "Books and Records" shall mean all materials, books and
records and data in whatever form or medium (i) furnished by the Companies to
AICL in connection with the performance by AICL of its obligations under the
Services Agreement; (ii) generated by AICL in connection with the performance by
AICL of its obligations under the Services Agreement; or (iii) that in any way
pertain to the performance of the obligations of AICL under the Services
Agreement, including books of account, insurance and reinsurance policies and
contracts entered into by the any of the Companies and all correspondence
related thereto, underwriting files, claim and reserving files, data on premium
and claim payments and any and all materials, books and records and data
relating to Companies' business.
4.2 The Companies shall maintain such Books and Records for a period of
ten (10) years or for the period as may be required under their respective
records retention policies if longer or for such longer period of time as may be
required by law or any applicable court order and AICL shall have reasonable
access to and the right to inspect and copy at its own expense, such Books and
Records during such period for (i) AICL's preparation of tax returns, including,
-2-
but not limited to, any inquiries by any governmental or regulatory authority in
respect of the taxes of AICL or (ii) AICL's response to any claims, lawsuits,
legal proceedings or investigations or (iii) any audit purposes.
4.3 Not withstanding any other provision of this Section 4 or this
Agreement generally, AICL shall have the right to retain, at its own expense, a
copy of any Books and Records and any original computer back-up tapes which
contain information relating to both the business and operations of AICL or its
affiliates and the Companies; provided that AICL shall maintain such Books and
Records and tapes for a period of ten (10) years or for the period as may be
required under its records retention policy if longer or for such longer period
of time as may be required by law or any applicable court order and further
provided that the Companies shall have reasonable access to and the right to
inspect and make a copy of such copy of the Books and Records and original tapes
to the extent they relate to the business and operations of any of the Companies
or to respond to any tax matters, claims, lawsuits, legal proceedings or
investigations.
5. Sale of Equipment
AICL, in consideration of the payment to it by the Operating Company
of $826,094.00 to be paid on or before April 25, 2006, has agreed to sell to the
Operating Company, the assets listed in Exhibit A hereto (the "Purchased
Assets"). AICL hereby transfers, sells, assigns and conveys to the Operating
Company, all of AICL's right, title, and interest, legal or equitable, in the
Purchased Assets, to have and to hold, all of the Purchased Assets unto the
Operating Company, its successors and assigns forever. It is expressly
understood and agreed by the parties hereto that AICL is selling the Purchased
Assets to the Operating Company "AS IS" without any express or implied
representations or warranties by AICL to the Operating Company or any other
person in respect of or relating to the Purchased Assets. To the best of AICL's
knowledge and belief (i) all computer desktops and laptops included in the
Purchased Assets have original equipment manufacturer licences ("OEM Licences"),
and (ii) such OEM Licences are transferred with the ownership of desktops and
laptops. The Operating Company hereby agrees that, to the extent required, it
will licence or re-licence all software transferred by AICL to it pursuant
hereto.
6. Arbitration
Any controversy or claim arising out of or relating to this
Agreement, or the breach thereof, shall be submitted to a panel of three
arbitrators. AICL and the Companies shall each appoint an arbitrator and the two
arbitrators so appointed will appoint a third arbitrator who shall act as the
umpire of the panel. Each such arbitrator shall be a current or former senior
business or company manager but shall not be associated with any of the parties
to this Agreement. Any arbitration hereunder shall take place in Bermuda, and
shall be conducted in accordance with the Rules of The Bermuda International
Conciliation and Arbitration Xxx 0000, as it may be amended or re-enacted from
time to time. The decision of a majority of the arbitrators shall be in writing,
shall state the reasons for the award, and shall be final and not subject to
appeal, and judgment upon the award or determination rendered by the arbitrators
may be entered in any court having jurisdiction thereof or having jurisdiction
over the parties or their assets.
-3-
7. Notices
All communications provided for hereunder shall be in writing, and
if to the Companies, mailed or delivered to each of the Companies at The Bermuda
Commercial Bank Building, 00 Xxxxxxxx Xxxxxx, Xxxxxxxx, Xxxxxxx XX 00,
Attention: President, or if to AICL, mailed or delivered to AICL at its office
at American Xxxxxxxxxxxxx Xxxxxxxx, 00 Xxxxxxxx Xxxx, Xxxxxxxx, Xxxxxxx XX 00,
Attention: President, or addressed to either party at any address that such
party may hereafter designate by written notice to the other party.
8. Entire Agreement; Amendment
This Agreement constitutes the entire agreement between the parties
with respect to the termination of the Services Agreement. The express terms
hereof supersede any course of performance or usage of the trade. This Agreement
may not be amended except in writing signed by each of the parties hereto.
9. No Waiver
Neither the failure nor delay on the part of any party in exercising
any right, remedy, power or privilege under this Agreement shall operate as a
waiver thereof, nor shall any single or partial exercise of any right, remedy,
power or privilege preclude any other or further exercise of the same or of any
other right, remedy, power or privilege, nor shall any waiver of any right or
remedy, power or privilege with respect to any occurrence be construed as a
waiver of such right, remedy, power or privilege with respect to any other
occurrence. No waiver hereunder shall be effective unless it is in writing and
is signed by the party asserted to have granted such waiver.
10. Successors and Assigns
The provisions of this Agreement shall be binding upon and shall
inure to the benefit of and be enforceable by each of the parties hereto and
their respective successors and assigns. Except to the extent expressly provided
for in this Agreement, neither AICL on the one hand nor the Companies (or either
of them) on the other hand shall have the right to assign any of its right,
powers and obligations under this Agreement without the prior written consent of
the other.
11. Governing Law; Submission to Jurisdiction
This Agreement shall be governed by and construed in accordance with
the laws of Bermuda, without reference to the principles of conflicts of law
thereof. If any suit is instituted by any of the parties to enforce any of the
terms or conditions of this Agreement, each of the parties hereby submits to the
exclusive jurisdiction of and venue in the courts of Bermuda.
12. Counterparts
This Agreement may be executed in any number of counterparts, each
of which shall be an original with the same effect as if the signatures thereto
and hereto were upon the same instrument, and such counterparts together shall
constitute one and the same instrument.
-4-
13. Headings
The section headings contained herein are for convenience only and
shall not alter or limit or define the provisions hereof.
14. Severability
In the event that any word, sentence, paragraph, provision, section,
subsection or article of this Agreement is found to be void or voidable, the
remainder of this Agreement shall nevertheless be legal and binding with the
same force and effect as though the void or voidable parts were deleted.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed in Pembroke, Bermuda on the date first written above.
ALLIED WORLD ASSURANCE HOLDINGS, LTD for itself and on
behalf of Allied World Assurance Company (U.S.) Inc.,
Newmarket Underwriters Insurance Company, Allied World
Assurance Holdings (Ireland) Ltd, Allied World
Assurance Company (Europe) Limited and Allied World
Assurance Company (Reinsurance) Limited
By: /s/ Xxxxx Xxxxxxxxx
-----------------------------------------------
Name:
Title:
ALLIED WORLD ASSURANCE COMPANY, LTD
By: /s/ Xxxxx Xxxxxxxxx
-----------------------------------------------
Name: Xxxxx Xxxxxxxxx
Title: President and Chief Executive Officer
-5-
AMERICAN INTERNATIONAL COMPANY LIMITED
By: /s/ S. Xxxxxx Xxxxxx
---------------------------------------
Name: S. Xxxxxx Xxxxxx
Title: President
-6-
