EXHIBIT 10 (C)
COMMUTATION AGREEMENT
AGREEMENT effective April 30, 2000 by and between Vesta Fire Insurance
Corporation, an Alabama Company ("Vesta") and American Hallmark Insurance
Company of Texas, a Texas Company (the "Reinsured").
WHEREAS, the parties hereto have entered into the Automobile Quota Share
Reinsurance Treaty, effective January 1, 1991 and terminated March 1, 1992
and the Quota Share Retrocession Agreement, effective March 1, 1992 and
terminated July 1, 1996, under which Vesta (known as Liberty National Fire
Insurance Company prior to March 1, 1994) has reinsured certain liabilities
of the Reinsured (the "reinsurance contracts"); and
WHEREAS, the parties hereto now wish to fully and finally determine and
settle all liabilities and obligations of the parties under the reinsurance
contracts.
NOW, THEREFORE, in consideration of the covenants set forth herein and the
payments to be made hereunder, the parties agree as follows:
ARTICLE I - PAYMENT
In consideration of the release given by the Reinsured in Article II below,
Vesta hereby (1) agrees to pay to the Reinsured within 10 business days
after execution of this document the sum of $506,931.76 and (2) releases and
discharges the Reinsured for any unpaid premiums due Vesta by the Reinsured
under the reinsurance contracts.
ARTICLE II - RELEASE
In consideration of the payment and release described in Article I above,
the Reinsured on behalf of itself, its agents, successors and assigns,
hereby releases and forever discharges Vesta, its successors and assigns,
from any and all liabilities and obligations arising under or related to the
reinsurance contracts, whether known or unknown, reported or unreported, and
whether currently existing or arising in the future, including but not
limited to all claims, debts, demands, causes of action, duties, sums of
money, covenants, contracts, controversies, agreements, promises, doings,
omissions, damages, judgments, costs, expenses and losses whatsoever. The
Reinsured acknowledges the payment described in Article I above as a
complete accord, satisfaction, settlement and commutation of all Vesta's
liabilities and obligations under the reinsurance contracts, including any
claims for commission or brokerage, and does hereby agree to indemnify and
hold harmless Vesta, its successors and assigns, from and against any and
all liability, costs, damages or expenses, including attorney's fees,
incurred in connection with any and all actual or threatened claims, actions
or proceedings against Vesta or the Reinsured, or either of their successors
or assigns, arising out of or relating to the reinsurance contracts.
ARTICLE III - GENERAL
A. This Agreement shall be binding upon and shall inure to the benefit of
the parties hereto and their respective successors and assigns.
B. This Agreement shall constitute the entire agreement between the
parties hereto related to the subject matter hereof and may not be
modified or amended, except by a written agreement executed by each of
the parties.
C. This Agreement shall be governed by and construed in accordance with
the laws of the State of Texas.
D. In the event that is Agreement is determined to be null and void, in
whole or in part, the parties agree that (1) the Reinsured will return
the full amount of the payment described in Article I above and (2)
Vesta will reassume its liabilities under the reinsurance contracts.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed by their respective authorized officers.
VESTA FIRE INSURANCE CORPORATION
By: _______________________________________
Title: _____________________________________
AMERICAN HALLMARK INSURANCE
COMPANY OF TEXAS
By: _______________________________________
Title: _____________________________________
