EXHIBIT 10.1
 
STOCK PURCHASE AGREEMENT
AMONG
SAFE HARBOUR HOLDINGS, LLC,
AMERICAN CAPITAL ASSURANCE CORP.,
NORTH POINTE HOLDINGS CORP.,
AND
NORTH POINTE FINANCIAL SERVICES, INC.
October 22, 2007
 

 

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STOCK PURCHASE AGREEMENT
     This STOCK PURCHASE AGREEMENT (this “Agreement”) is made as of October 22,
2007 by and among American Capital Assurance Corp., a Florida corporation
(“Buyer”), which is a wholly owned subsidiary of Safe Harbour Holdings, LLC, a
Delaware limited liability company (“Safe Harbour”), and North Pointe Financial
Services, Inc., a Michigan corporation (“Seller”), which is a wholly owned
subsidiary of North Pointe Holdings Corporation, a Michigan corporation
(“NPHC”). Each of Buyer and Seller may hereafter be referred to as a “Party” or
collectively as the “Parties.”
     Seller owns the Shares (as defined herein). Seller desires to sell to
Buyer, and Buyer desires to purchase from Seller, the Shares upon the terms and
subject to the conditions set forth in this Agreement. As a result of the
transactions contemplated herein, Buyer will acquire the Shares, and Seller will
receive the consideration described in ARTICLE II of this Agreement.
     In consideration of the premises and the mutual promises herein made, and
intending to be legally bound hereby, the Parties agree as follows:
ARTICLE I
DEFINITIONS
     In addition to the other definitions contained herein, the following
definitions shall apply for purposes of this Agreement:
     1.1 Affiliate. “Affiliate” means, with respect to any Person, (a) any other
Person that controls, is controlled by, or is under common control with such
Person. For purposes of this definition, the term “control” of a Person shall
mean the possession, directly or indirectly, of the power to direct or cause the
direction of the management or policies of that Person, whether through the
ownership of voting securities, by Contract or otherwise.
     1.2 Affiliate Contracts. “Affiliate Contracts” has the meaning specified in
Section 3.11(h).
     1.3 Annual Financial Statements. “Annual Financial Statements” means the
balance sheets of the Company as of December 31 for each of the years 2006 and
2005, and the statements of income and cash flows for the years ending
December 31, 2006 and 2005, including the notes thereto, attached in
Section 3.6(d) of the Disclosure Schedule.
     1.4 Books and Records. “Books and Records” means all of the books, records,
files and correspondence exclusively relating to the Company.
     1.5 Book Value. “Book Value” means an amount equal to (a) the amount of the
Total Assets of the Company, minus (b) the amount of the Total Liabilities of
the Company (other than accrued liabilities for Taxes due with respect to Tax
Periods ending on or before the Closing Date, which liabilities Seller is
obligated to pay pursuant to Section 12.2(a)), as determined in accordance with
GAAP applied consistently with the past practice of the Company.

 

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     1.6 Business. “Business” means the business conducted by the Company.
     1.7 Business Day. “Business Day” means any day that is not a Saturday,
Sunday or any other day on which banks are required or authorized by Law to be
closed in Detroit, Michigan or Tampa, Florida.
     1.8 Business Guidelines. “Business Guidelines” has the meaning specified in
Section 3.16(b).
     1.9 Buyer. “Buyer” means American Capital Assurance, Corp., a Florida
corporation.
     1.10 Buyer Indemnitees. “Buyer Indemnitees” has the meaning specified in
Section 10.3(b).
     1.11 Closing. “Closing” means the closing of the transactions provided for
in this Agreement, which shall take place on the Closing Date at the offices of
Honigman Miller Schwartz and Cohn LLP, 2290 First National Building, 660
Woodward, Detroit, Michigan 48226 or such other place as the Parties may agree.
     1.12 Closing Value Statement. “Closing Value Statement” has the meaning
specified in Section 2.4(a).
     1.13 Closing Date. “Closing Date” means a date mutually acceptable to
Seller and Buyer not later than five (5) Business Days after the satisfaction of
all closing conditions, including receipt of the Consent Order of the Florida
Office of Insurance Regulation approving the sale of the Shares to Buyer.
     1.14 Code. “Code” means the Internal Revenue Code of 1986, as amended, and
any applicable rules and regulations thereunder, and any successor to such
statute, rules or regulations.
     1.15 Company. “Company” means Home Pointe Insurance Company, a Florida
insurance corporation.
     1.16 Confidential Information. “Confidential Information” means any
information concerning the Business and affairs of the Company not generally
available to the public.
     1.17 Consent. “Consent” means, with respect to any Person, any consent,
approval, release or authorization by such Person.
     1.18 Contract. “Contract” means any oral or written contract.
     1.19 Controlling Party. “Controlling Party” has the meaning specified in
Section 10.5(d).
     1.20 Damages. “Damages” means all costs, losses, damages, and other
expenses (including interest, penalties and reasonable attorneys’ fees and
expenses, whether in connection

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with Third Party Claims or claims among the Parties inter se for the enforcement
of the provisions of this Agreement).
     1.21 Disclosure Schedule. “Disclosure Schedule” means the disclosure
schedule dated the date of this Agreement. Terms used in the Disclosure Schedule
and not otherwise defined therein have the same meanings as set forth in this
Agreement.
     1.22 Effective Time. “Effective Time” means 12:01 A.M. EST on the first day
of the month in which the Closing Date occurs.
     1.23 ERISA. “ERISA” means the Employee Retirement Income Security Act of
1974, as amended, and any applicable rules and regulations thereunder, and any
successor to such statute, rules or regulations.
     1.24 Existing Reinsurance Agreements. “Existing Reinsurance Agreements” has
the meaning specified in Section 3.17.
     1.25 Final Book Value. “Final Book Value” has the meaning specified in
Section 2.5(a).
     1.26 GAAP. “GAAP” means generally accepted accounting principles in the
United States as set forth in pronouncements of the Financial Accounting
Standards Board.
     1.27 Governmental Body. “Governmental Body” means any foreign or domestic
federal, state or local government or quasi-governmental authority or any
department, agency, subdivision, court or other tribunal of any of the
foregoing.
     1.28 Income Taxes. “Income Taxes” (or “Income Tax”) means all Taxes based
upon, measured by, assessed or imposed upon net income.
     1.29 Income Tax Return. “Income Tax Return” means any Tax Return relating
to Income Taxes.
     1.30 Indebtedness. “Indebtedness” means any (a) obligation relating to
indebtedness for borrowed money, including any bank overdraft, (b) obligation
evidenced by a note, bond, debenture or similar instrument, and (c) obligation
in respect of banker’s acceptances or letters of credit.
     1.31 Indemnified Party. “Indemnified Party” has the meaning specified in
Section 10.1.
     1.32 Indemnifying Party. “Indemnifying Party” has the meaning specified in
Section 10.1.
     1.33 Initial Purchase Price. “Initial Purchase Price” has the meaning
specified in Section 2.3.

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     1.34 Interim Financial Statements. “Interim Financial Statements” means the
unaudited balance sheet of the Company as of September 30, 2007, and the
statements of income and cash flows for the nine-month period then ended, all
attached hereto in Section 3.6(d) of the Disclosure Schedule.
     1.35 Knowledge of Seller. “Knowledge of Seller” means the actual knowledge
after due inquiry of any of the employees listed on Exhibit 1.35.
     1.36 Law. “Law” means any domestic (federal, state or local) or foreign
law, statute, code, ordinance, rule, regulation, constitution or treaty of any
Governmental Body.
     1.37 Licenses and Permits. “Licenses and Permits” means all licenses and
permits issued to the Company by any Governmental Body, and include any licenses
and permits which are required for the Company to conduct the Business as it is
presently being conducted, including all authorizations or other qualifications
to transact insurance or reinsurance or to write insurance on a surplus line or
non-admitted basis.
     1.38 Lien. “Lien” means any mortgages, liens, deeds of trust, security
interests, pledges, restrictions, prior assignments, charges, claims, defects in
title, restrictions on transfer, Taxes, options, warrants, purchase rights,
demands and encumbrances of any kind or type whatsoever.
     1.39 Material Adverse Effect; Material Adverse Change. “Material Adverse
Effect” or “Material Adverse Change” means any effect or change, respectively,
which is, or which is reasonably likely to be, materially adverse to the Company
taken as a whole.
     1.40 Material Contracts. “Material Contracts” has the meaning specified in
Section 3.12.
     1.41 North Pointe Casualty. “North Pointe Casualty” shall mean North Pointe
Casualty Insurance Company, a Florida insurance company.
     1.42 Notice. “Notice” has the meaning specified in Section 13.3.
     1.43 Notice of Disagreement. “Notice of Disagreement” has the meaning
specified in Section 2.4(b).
     1.44 Order. “Order” means any order, award, decision, injunction, judgment,
ruling, decree, charge, writ, subpoena or verdict entered, issued, made or
rendered by any Governmental Body or arbitrator.
     1.45 Ordinary Course of Business. “Ordinary Course of Business” means the
ordinary course of the Business conducted by the Company, consistent with past
custom and practice.
     1.46 Person. “Person” means a natural person, corporation, trust,
partnership, limited liability company, limited liability partnership,
association, joint stock company, joint venture, unincorporated organization,
Governmental Body, or any other legal entity.

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     1.47 Policies. “Policies” has the meaning specified in Section 3.16(b).
     1.48 Power of Attorney. “Power of Attorney” shall mean a Power of Attorney
in form identical to that which is attached hereto as Exhibit 1.48.
     1.49 Proceeding. “Proceeding” means any action, audit, lawsuit, litigation,
proceeding, hearing, investigation or arbitration or other method of settling
disputes or disagreements (in each case, whether civil, criminal or
administrative) by or before any Governmental Body or arbitrator.
     1.50 Producers. “Producers” means agents, brokers, general agents, managing
general agents, reinsurance intermediaries and insurance producers that sell,
market, solicit or underwrite the Policies of the Company.
     1.51 Purchase Price Adjustment. “Purchase Price Adjustment” has the meaning
specified in Section 2.5(b).
     1.52 Receivables. “Receivables” has the meaning specified in
Section 3.9(a).
     1.53 Recoupable Assessments. “Recoupable Assessments” means any monies
received by the Company subsequent to the Closing Date that relate to the
recoupment of prior assessments by Citizens Property Insurance Company, the
Florida Insurance Guaranty Association or the Florida Hurricane Catastrophe
Fund, in either case that were incurred by the Company on or before the Closing
Date, and are not owed to the Company’s reinsurers under its reinsurance
agreements.
     1.54 Reinsurance Agreement. “Reinsurance Agreement” means the Quota Share
Reinsurance Contract between the Company and North Pointe Casualty in which
North Pointe Casualty will take responsibility for all insurance Losses of the
Company that occur before Closing, in the form attached as Exhibit 1.54.
     1.55 Reinsurance Premium. “Reinsurance Premium” shall have the meaning
assigned to such term in the Reinsurance Agreement.
     1.56 Requisite Regulatory Approvals. “Requisite Regulatory Approvals” has
the meaning specified in Section 7.2.
     1.57 SAP. “SAP” has the meaning specified in Section 3.6(d).
     1.58 Seller. “Seller” means North Pointe Financial Services, Inc., a
Michigan corporation.
     1.59 Seller Indemnitees. “Seller Indemnitees” has the meaning specified in
Section 10.4(b).
     1.60 Seller’s Legal Opinion. “Seller’s Legal Opinion” means a legal opinion
of counsel for Seller in substantially the form attached hereto as Exhibit 1.60.

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     1.61 Seller’s Transaction Expenses. “Seller’s Transaction Expenses” means
any and all legal, accounting, Tax, consulting, financial advisory and other
professional or transaction related costs, fees and expenses incurred by Seller
in connection with this Agreement or in investigating, pursuing or completing
the transactions contemplated hereby (including any amounts owed by Seller to
any consultants, auditors, accountants, attorneys or investment bankers).
     1.62 Shares. “Shares” means all of the issued and outstanding equity
interests in the Company.
     1.63 Statutory Statements. “Statutory Statements” has the meaning specified
in Section 3.6(d).
     1.64 Taxes. “Taxes” (or “Tax”) means any federal, state, county, local,
foreign, territorial, taxes, imposts, charges, fees, levies, and duties, whether
or not measured in whole or in part by net income, including interest, additions
to tax or interest, and assessments and penalties with respect thereto.
     1.65 Tax Return. “Tax Return” shall mean any and all reports, returns
(including information returns), or other documents required to be supplied to a
Governmental Body with respect to any Tax, including any schedule or attachment
thereto, and including any amendment thereof.
     1.66 Third Party Claim. “Third Party Claim” has the meaning specified in
Section 10.5(b).
     1.67 Total Assets. “Total Assets” means all of the assets on the books of
the Company, as determined in accordance with GAAP applied consistently and in
accordance with the past accounting practices of the Company.
     1.68 Total Liabilities. “Total Liabilities” means all of the liabilities on
the books of the Company, as determined in accordance with GAAP applied
consistently and in accordance with the past accounting practices of the
Company.
ARTICLE II
PURCHASE AND SALE
     2.1 Purchase and Sale. In accordance with the terms and upon the conditions
contained in this Agreement, at the Closing, Seller shall sell, transfer,
assign, convey and deliver to Buyer all right, title and interest in and to the
Shares, free and clear of all Liens.
     2.2 Payments.
          (a) At the Closing, Buyer shall pay the Initial Purchase Price to
Seller.
          (b) At the Closing, Buyer shall pay the Reinsurance Premium to Seller.

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          (c) Within five (5) days after the Final Book Value has been
determined pursuant to Section 2.4, Buyer shall pay to Seller, or Seller shall
pay to Buyer, as the case may be, the Purchase Price Adjustment.
          (d) In addition, within forty-five (45) days after the end of each
applicable calendar quarter after the Effective Time, Buyer shall pay Seller
one-half of any Recoupable Assessments received during such quarter, but only to
the extent such amounts are not accrued into income or actually received before
the Closing Date.
          (e) All payments pursuant to this Section 2.2 shall be made by wire
transfer of immediately available funds to an account designated by the
recipient in writing.
     2.3 Purchase Price Determination.
     The initial purchase price shall be equal to the Book Value as reflected on
the unaudited financial statements of the Company for the Effective Time (the
“Initial Purchase Price”).
     2.4 Final Book Value.
          (a) As promptly as practicable, but no later than 90 days after the
Closing Date, the Buyer will cause to be prepared and delivered to Seller a
detailed calculation (the “Closing Value Statement”) of the Book Value as of the
Effective Time. The Closing Value Statement will be accompanied by a certificate
of an officer of Buyer, on behalf of Buyer in such officer’s corporate capacity,
specifying that the Closing Value Statement was prepared in accordance with the
provisions of this Section 2.4(a).
          (b) If Seller disagrees with Buyer’s calculation of the Book Value as
of the Effective Time as set forth in the Closing Value Statement delivered
pursuant to Section 2.4(a), Seller may, within 20 days after delivery of the
Closing Value Statement, deliver a notice (the “Notice of Disagreement”) to
Buyer disagreeing with such calculation and setting forth Seller’s calculation
of such amount. Failure to notify Buyer within such 20-day period shall be
deemed acceptance of the Closing Value Statement. Any Notice of Disagreement
shall specify those items or amounts as to which Seller disagrees, and Seller
shall be deemed to have agreed with all other items and amounts contained in the
Closing Value Statement delivered pursuant to Section 2.4(a).
          (c) If a Notice of Disagreement is duly delivered pursuant to
Section 2.4(b), Buyer and Seller shall, during the 15 days following the
delivery of such Notice, use their reasonable best efforts to reach agreement on
the disputed items or amounts in order to determine, as may be required, the
amount of the Book Value as of the Effective Time, which amount shall not be
less than the amount thereof shown in Buyer’s calculations delivered pursuant to
Section 2.4(a), nor more than the amount thereof shown in Seller’s calculation
delivered pursuant to Section 2.4(b). If, during such period, Buyer and Seller
are unable to reach such agreement, they shall promptly thereafter cause an
independent accountant of nationally recognized standing reasonably satisfactory
to Buyer and Seller (who shall not have any material relationship with Buyer or
Seller) promptly to review this Agreement and the disputed items or amounts for
the purpose of calculating the Book Value as of the Effective Time. In making
such calculation, such independent accountant shall consider only those items or
amounts in the Book

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Value as of the Effective Time as to which Seller and Buyer have disagreed. Such
independent accountant shall deliver to Buyer and Seller, as promptly as
practicable, a report setting forth such calculation. Such report shall be final
and binding upon Buyer and Seller. The cost of such review and report shall be
borne by the party whose calculation of the Book Value as of the Effective Time
differs most greatly from such independent accountant’s final determination.
          (d) Buyer and Seller agree that they will, and agree to cause their
respective independent accountants to, cooperate and assist in the preparation
of the Closing Value Statement and the calculation of the Book Value as of the
Effective Time and in the conduct of the audits and reviews referred to in this
Section 2.4, including without limitation, the making available to the extent
necessary of books, records, work papers and personnel. The work papers of their
respective independent accountants, as they relate to the computations of the
Book Value as of the Effective Time shall be furnished upon request to Buyer and
Seller.
     2.5 Adjustments to Purchase Price.
          (a) If Final Book Value is less than the Initial Purchase Price,
Seller shall pay to Buyer, as an adjustment to the Initial Purchase Price, the
amount by which the Initial Purchase Price exceeds Final Book Value. If Final
Book Value is more than the Initial Purchase Price, Buyer shall pay to Seller,
as an adjustment to the Initial Purchase Price, the amount by which Final Book
Value exceeds the Initial Purchase Price. “Final Book Value” means the Book
Value as of the Effective Time (1) as shown in Buyer’s calculation delivered
pursuant to Section 2.4(a), if no notice of disagreement with respect thereto is
duly delivered pursuant to Section 2.4(b); or (2) if such a notice of
disagreement is delivered, (A) as agreed by Buyer and Seller pursuant to
Section 2.4(b) or (B) in the absence of such agreement, as shown in the
independent accountant’s calculation delivered pursuant to Section 2.4(c);
provided that in no event shall Final Book Value be less than Buyer’s
calculation of Book Value as of the Effective Time delivered pursuant to
Section 2.4(a) or more than Seller’s calculation of Book Value as of the
Effective Time delivered pursuant to Section 2.4(b).
          (b) Any adjustment to the Initial Purchase Price (“Purchase Price
Adjustment”) required to be paid pursuant to Section 2.5(a) shall be wired to
the Seller or Buyer, as appropriate and in accordance with wiring instructions
to be provided by the recipient within five (5) days after the Final Book Value
has been determined.
ARTICLE III
REPRESENTATIONS AND WARRANTIES RELATING TO THE COMPANY
     Seller represents and warrants to Buyer as of the date hereof and as of the
Closing Date that, except as disclosed on the Disclosure Schedule and any
update, amendment, or supplement thereto if and as agreed to by Buyer pursuant
to Section 6.11:
     3.1 Organization, Capitalization.
          (a) The Company is a corporation duly organized, validly existing and
in good standing under the Laws of the State of Florida. The Company has all
requisite corporate power and authority to carry on its Business as it is now
being conducted and to own and lease

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its assets which it now owns and leases. The Company is duly licensed,
registered and qualified to do business and is in good standing in all states in
which the ownership or leasing of its assets or the conduct of its Business
requires such qualification. Section 3.1(a) of the Disclosure Schedule sets
forth each state in which the Company is licensed or qualified to do business.
Seller has delivered to Buyer accurate and complete copies of the articles of
incorporation, bylaws, minute books and stock records of the Company.
          (b) Section 3.1(b) of the Disclosure Schedule sets forth all of the
authorized, issued and outstanding Shares of the Company. The Shares are duly
authorized, validly issued, fully paid and nonassessable and have been issued
without violation of any preemptive or other right to purchase, and are held of
record by Seller. Seller has good and indefeasible title to the Shares, free and
clear of all Liens. There are no other stock or other equity ownership interests
in the Company or outstanding securities convertible or exchangeable into stock
or other equity ownership interests of the Company, and there are no options,
warrants, purchase rights, subscription rights, conversion rights, exchange
rights, calls, puts, rights of first refusal or other Contracts that could
require the Company to issue, sell or otherwise cause to become outstanding
stock or other equity ownership interests in the Company.
     3.2 Subsidiaries. The Company has no subsidiaries and has no Contract in
respect of any strategic partnership or similar relationship.
     3.3 Investments. Section 3.3 of the Disclosure Schedule sets forth a
complete, correct and accurate list of each of the securities in the Company’s
investment portfolio and their fair market value as of the date of the Interim
Financial Statements.
     3.4 Authorization, Validity, and Enforceability. All corporate acts or
proceedings required to be taken by the Company to authorize the execution,
delivery and performance of this Agreement and the Reinsurance Agreement and all
transactions contemplated hereby and thereby have been duly and properly taken.
The Reinsurance Agreement to be delivered by the Company at the Closing will be
duly executed and delivered and constitute lawful, valid and legally binding
obligations of the Company, enforceable in accordance with their terms. All
corporate acts or proceedings required to be taken by North Pointe Casualty to
authorize the execution, delivery and performance of the Reinsurance Agreement
and all transactions contemplated thereby have been duly and properly taken. The
Reinsurance Agreement to be delivered by North Pointe Casualty at the Closing
will be duly executed and delivered and constitute lawful, valid and legally
binding obligations of North Pointe Casualty, enforceable in accordance with its
terms.
     3.5 Compliance. The execution and delivery of this Agreement and the
Reinsurance Agreement and the consummation of the transactions contemplated
hereby and thereby will not result in the creation of any Lien or the
termination or acceleration of any Indebtedness or other obligation of the
Company or of North Pointe Casualty and are not prohibited by, do not violate or
conflict with any provision of, do not constitute a default under or a breach of
and do not impair any rights or give rise to any rights to terminate or modify
or to damages or penalties under (a) the articles of incorporation or bylaws of
the Company or North Pointe Casualty, (b) any Indebtedness, Contract, Licenses
and Permits or other instrument to which the Company or North Pointe Casualty is
a party or by which the Company or North Pointe Casualty or any of

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their assets are bound, (c) any Order applicable to the Company or North Pointe
Casualty, or (d) any Law applicable to the Company or North Pointe Casualty.
There is no Proceeding or Order (or any basis therefor) pending or, to the
Knowledge of Seller, threatened against or affecting the Company or North Pointe
Casualty, which in any manner challenges or seeks to prevent, enjoin, alter or
materially delay the transactions contemplated by this Agreement.
     3.6 Financial Statements.
          (a) The Annual Financial Statements and Interim Financial Statements
(i) are correct and complete and are consistent with the books of account and
records of the Company, (ii) present fairly in all material respects the
financial condition, results of operations and changes in equity and cash flow
of the Company as of the dates and for the periods indicated, and (iii) have
been prepared in accordance with GAAP consistently applied, except that the
Interim Financial Statements do not contain all of the footnotes required by
GAAP.
          (b) The books, records and accounts of the Company accurately and
fairly reflect in all material respects the activities of the Company.
          (c) The Company is not insolvent, has not proposed a compromise or
similar arrangement to its creditors generally, has not had any petition for a
receiving order in bankruptcy filed against it, has not made a voluntary
assignment in bankruptcy, has not taken any proceeding to have a receiver
appointed to any part of its assets, and has not had any debtor take possession
of any of its property.
          (d) Section 3.6(d) of the Disclosure Schedule sets forth (i) the
audited annual statements of the Company as of December 31, 2005 and 2006,
(ii) unaudited quarterly statements of the Company as of March 31 and June 30,
2007, as filed with the insurance regulatory authority in Florida, together will
all exhibits, schedules and notes thereto and any affirmations and
certifications filed therewith (collectively, the “Statutory Statements”), and
(iii) interim GAAP statements for the quarter ended September 30, 2007. The
Statutory Statements were prepared in accordance with statutory accounting
principles prescribed or permitted by the State of Florida (“SAP”) consistently
applied during the periods covered thereby and fairly present the financial
condition of the Company on the dates of such statements and the results of its
operations and cash flows for the periods covered thereby, and no insurance
regulatory authority has asserted any material deficiency with respect to such
Statutory Statements.
          (e) The Company has no Indebtedness.
     3.7 Absence of Undisclosed Liabilities. To the Knowledge of Seller, all
material liabilities of the Company are reflected either in the Disclosure
Schedule or on balance sheet included with the Interim Financial Statements.
     3.8 Good Title. Except as set forth in Section 3.8 of the Disclosure
Schedule, the Company has good and marketable title to all of its property,
whether real, personal, tangible or intangible as reflected on the balance sheet
included in the Interim Financial Statements including, but not limited to the
investments in the Investment Portfolio, free and clear of all Liens.

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     3.9 Accounts Receivable; Accounts Payable; Recoupable Assessments.
          (a) All reinsurance recoverables, premium receivables and other
accounts receivable of the Company reflected on the Interim Financial
Statements, and all reinsurance recoverables, premium receivables and other
accounts receivable of the Company accrued since the date of the Interim
Financial Statements (collectively, the “Receivables”), arose in the Ordinary
Course of Business.
          (b) The accounts payable of the Business reflected on the Interim
Financial Statements arose in the Ordinary Course of Business, and all such
accounts payable have either been paid, are not yet due and payable, or are
being contested by the Company in good faith. All accounts payable being
contested in good faith are set forth on Section 3.9(b) of the Disclosure
Schedule.
          (c) Section 3.9(c) of the Disclosure Schedule sets forth the
Recoupable Assessments for the Company.
     3.10 Real Estate. Except for office space leased from an Affiliate of the
Company, the Company does not own or lease, and has never owned or leased any
parcel of real property.
     3.11 Absence of Certain Changes or Events. Since the date of the Interim
Financial Statements and except as set forth in the Disclosure Schedule or as
specifically provided in this Agreement:
          (a) there has not been any Material Adverse Change;
          (b) except for disposition of assets in the Investment Portfolio, the
Company has not sold, leased, transferred, assigned or otherwise disposed of any
of its assets (tangible or intangible) with a value in excess of $10,000;
          (c) except for acquisition of assets in the Investment Portfolio, the
Company has not purchased any assets or property (tangible or intangible) with a
value in excess of $10,000;
          (d) the Company has not made any commitments for material capital
expenditures to be paid after the Closing;
          (e) the Company has not made any material change in its accounting
practices or methodologies, reserve practices or methodologies, underwriting
standards or practices, payment practices, collection practices, selling
practices or levels of sales efforts, or otherwise materially changed its method
of doing business;
          (f) there has been no material change in the classes and types of
insurance business written by the Company;
          (g) the Company has not issued, sold or otherwise disposed of any of
its stock or other equity ownership interests, or granted any rights to acquire
any of its stock or other equity ownership interests or declared, set aside,
made or paid any dividend or distribution with

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respect to its stock or other equity ownership interests or redeemed, purchased
or otherwise acquired any stock or other equity ownership interest of the
Company;
          (h) except for payments under contracts with its Affiliates (the
“Affiliate Contracts”), the Company has not made any payments of any form or
kind to Seller or other Affiliates of the Company; and
          (i) the Company has not agreed, whether in writing or otherwise, to
take any action described in this Section.
     3.12 Material Contracts. Other than the Policies, the Investments and any
Contracts which will be terminated as of the Closing Date, the Company is not a
party to or subject or bound by any Contracts for an amount in excess of $5,000
or a term greater than one year (the “Material Contracts”), except as set forth
on Section 3.12 of the Disclosure Schedule. Seller has delivered a correct and
complete copy of each such written Material Contract to Buyer, together with all
amendments, exhibits, attachments, waivers or other changes thereto.
     3.13 Litigation and Other Proceedings. Other than disputes that arose in
the Ordinary Course of Business with respect to the policies, the Company is not
engaged in or a party to or, to the Knowledge of Seller, threatened with any
Proceeding or Order. Section 3.13 of the Disclosure Schedule lists all material
Proceedings and Orders involving the Company since its incorporation.
     3.14 Employees. The Company does not have and has never had any employees
or any independent contractors who would be classified as employees for
employment benefit purposes.
     3.15 Licenses and Permits. All material Licenses and Permits are set forth
in Section 3.15 of the Disclosure Schedule. All Licenses and Permits are in full
force and effect and will remain in full force and effect immediately following
the consummation of the transactions contemplated hereby.
     3.16 Compliance With Law.
          (a) To the Knowledge of Seller, the operations of the Company and its
Producers comply and have been in material compliance with all applicable Laws
and Orders. No written notice from any Person of any violation of any Law or
Order by the Company has been received by the Company.
          (b) Section 3.16(b)(1) of the Disclosure Schedule identifies all forms
of insurance policies and riders thereto (collectively, “Policies”) currently
issued by the Company that have been filed under applicable insurance Laws
requiring the approval of such forms by any Governmental Body.
Section 3.16(b)(2) of the Disclosure Schedule contains a list of each such
Policy indicating those Policies which are currently issued and those which are
filed pending review by applicable Governmental Bodies. All policy applications
with respect to Policies currently issued and required to be filed with or
approved by applicable authorities under applicable insurance Laws have been so
filed or approved. Any premium rates with respect to Policies currently issued,
required to be filed with or approved by applicable

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Governmental Bodies under applicable insurance Laws have been so filed or
approved and premiums charged conform thereto in all material respects. Any
premium rate with respect to Policies currently issued or in the past issued
comply or complied with, as applicable, all insurance ratings Laws. The Company
is in material compliance with such filing requirements. No deficiencies have
been asserted by any Governmental Body with respect to any such filings which
have not been cured or otherwise resolved to the satisfaction of such
Governmental Body. The underwriting standards utilized and rates and rating
factors and criteria applied by the Company with respect to outstanding Policies
have been previously disclosed to Buyer and with respect to any such Policies
reinsured in whole or in part, conform in all material respects to the standards
and ratings required pursuant to the terms of the related reinsurance or other
Contract. Section 3.16(b)(3) of the Disclosure Schedule sets forth all currently
utilized underwriting, actuarial, reserve (including claims department policies
relating to establishing and maintaining appropriate reserves) or investment
policies or guidelines of the Company (collectively, “Business Guidelines”).
          (c) The sale, marketing (including, but not limited to, any
advertisements and point-of-sale materials) and administration of the Company’s
Policies and reinsurance Contracts have been conducted in material compliance
with all federal, state, local and foreign Law applicable to such sale,
marketing and administration. All filings or submissions made by the Company
with respect to its form Policies or reinsurance Contracts with any Governmental
Body were in material compliance with applicable Law when filed and no
deficiencies have been asserted by any such Governmental Body with respect to
such filings or submissions that have not been satisfied.
          (d) The Company has (i) timely paid all guaranty fund assessments that
are due, or claimed or asserted by any Governmental Body to be due from the
Company or (ii) provided for all such assessments in the Annual Financial
Statements and Interim Financial Statements to the extent necessary to be in
conformity with GAAP or SAP, as applicable.
          (e) Section 3.16(e) of the Disclosure Schedule lists all funds
required to be maintained under any applicable insurance Law in each
jurisdiction in which the Company is qualified to act as an insurer (each a
“Deposit”).
     3.17 Reinsurance. Section 3.17(a) of the Disclosure Schedule lists all
ceded or assumed reinsurance or retrocessional treaties and Contracts and
facultative certificates to which the Company is currently a party and under
which there is liability by any Party to such agreement or certificate
(collectively, the “Existing Reinsurance Agreements”). Each of the Existing
Reinsurance Agreements is valid and binding in all material respects in
accordance with its terms. Except as disclosed in Section 3.17(b) of the
Disclosure Schedule, none of the Existing Reinsurance Agreements contains any
provision providing that another party thereto may unilaterally terminate such
Existing Reinsurance Agreement, whether as a result of a change of control or
otherwise. Except as disclosed in Section 3.17(c) of the Disclosure Schedule,
the Company is entitled to take full credit on its statutory financial
statements filed with state insurance regulatory authorities with respect to any
Existing Reinsurance Agreement pursuant to which the Company has ceded
reinsurance. Except as set forth in Section 3.17(d) of the Disclosure Schedule,
no reinsurer of the Company has canceled or otherwise terminated its
relationship with the Company and no reinsurer has, to the Knowledge of Seller,
any plan or

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intention to terminate, to cancel or otherwise materially and adversely modify
its relationship with the Company.
     3.18 Producers.
          (a) Section 3.18(a) of the Disclosure Schedule sets forth a correct
and complete list of the twenty (20) largest (in terms of the dollar volume of
premiums written) Producers of the Company during the two (2) preceding fiscal
years and during the current fiscal year to the date of the most recent balance
sheet included in the Interim Financial Statements, showing the approximate
total dollar amount of premiums written by each such Producer during each such
fiscal year. All Producers have been paid the correct amount of commission, and
there are otherwise no outstanding disputes with any of such Producers and, to
the Knowledge of Seller, the relationships of the Company with such Producers
are good commercial working relationships.
          (b) Since December 31, 2006, none of the Producers listed on
Section 3.18(a) of the Disclosure Schedule has indicated in writing to the
Company that it shall stop, or materially decrease its volume of, writing
policies through the Company, or otherwise materially change the terms of its
relationship with the Company. To the Knowledge of Seller, there is no fact,
condition or event which would adversely affect the relationship of the Company
with any such Producer.
     3.19 Intellectual Property. All intellectual property owned by the Company,
except its name and the design shown on Exhibit 6.13, will be included in the
sale and will be transferred to Buyer at the Closing.
     3.20 Tax Matters, Tax Returns and Tax Audits.
          (a) All Tax Returns required to be filed by the Code or any other
applicable Law by or on behalf of the Company or with respect to the assets or
operations of the Company have been duly filed in a timely manner (within any
applicable extension periods), and such Tax Returns are true, complete and
correct in all material respects.
          (b) All material Taxes due and owing by the Company or with respect to
the assets or operations of the Company have been timely paid (taking into
account any applicable extension periods) in full or properly accrued.
          (c) The Company has withheld and paid or accrued all Taxes required by
applicable Law to be withheld and paid in connection with any amounts paid or
owing to any Producer, contractor, creditor, or other third party.
          (d) The Company has not executed any currently effective waiver of any
statute of limitations or extension of the period for the assessment or
collection of any Tax.
          (e) No audit or other examination of any Tax Return of the Company by
any Tax authority is presently in progress, nor has the Company been notified in
writing by any Tax authority of any request for such an audit or other
examination, in each case except for the consolidated Income Tax Returns that
include Seller. No adjustment relating to any Tax Returns

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filed by, or on behalf of the Company has been proposed in writing by any Tax
authority to Seller or the Company.
          (f) To the Knowledge of Seller, no written claim has been received
from a Tax authority in a jurisdiction where the Company does not file a Tax
Return that the Company is or may be subject to Tax in that jurisdiction.
          (g) The Company has not agreed and is not required to include in
income any adjustment by reason of a change in accounting method or otherwise
under Section 481(a) of the Code (or an analogous provision of Law).
     3.21 Brokerage. Seller and Company do not have any liability or obligation
to pay any fees or commissions to any broker, finder, or agent with respect to
the transactions contemplated by this Agreement for which Buyer could become
liable or obligated.
     3.22 A.M. Best Rating. (a) A.M. Best has assigned Home Pointe a financial
strength ratings of B+ and Sellers have not been advised that A.M. Best is
considering any downgrade of such rating, (b) A.M. Best has not announced or
indicated to Home Pointe, the Sellers or its Subsidiaries that it has under
surveillance or review the financial strength of Home Pointe; and (c) except as
set forth in Section 3.22 (c) of the Disclosure Schedule, A.M. Best has not
communicated to Home Pointe or its Subsidiaries that any rating specified in
(a) above is likely to be modified, qualified, lowered or placed under such
surveillance or review for any reason, other than as a result of the
transactions contemplated hereby.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF SELLER
     Seller hereby represents and warrants to Buyer that the statements
contained in this ARTICLE IV applicable to Seller are true and correct as of the
date of this Agreement and will be true and correct as of the Closing Date (as
though made then and as though the Closing Date were substituted for the date of
this Agreement throughout this ARTICLE IV), except as set forth in the
corresponding section of the Disclosure Schedule.
     4.1 Corporate Organization. Seller is a corporation duly organized, validly
existing and in good standing under the Laws of the State of Michigan. Seller
has all requisite corporate power and corporate authority to carry on its
business as it is now being conducted and to own and lease the properties and
assets it now owns and leases.
     4.2 Authorization, Validity and Enforceability. Seller has full power and
authority to execute and deliver this Agreement and to perform its obligations
hereunder and thereunder. The execution, delivery and performance of this
Agreement has been duly authorized by Seller. This Agreement has been duly
executed and delivered by Seller.
     4.3 Compliance. The execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby by Seller will not and do
not constitute a default under or a breach of and do not impair any rights or
give rise to any rights to terminate or modify or to damages or penalties under
(a) the articles of incorporation or bylaws of the Seller,

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(b) any Indebtedness, Contract, permit or other instrument to which Seller is a
party or by which the Seller or any of its assets are bound, (c) any Order
applicable to the Seller, or (d) any Law applicable to the Seller. There is no
Proceeding or Order (or any basis therefor) pending or, to the knowledge of
Seller, threatened against or affecting Seller, which in any manner challenges
or seeks to prevent, enjoin, alter or materially delay the transactions
contemplated by this Agreement.
     4.4 Brokerage. Seller does not have any liability or obligation to pay any
fees or commissions to any broker, finder, or agent with respect to the
transactions contemplated by this Agreement for which Buyer could become liable
or obligated.
     4.5 Ownership of the Shares. Seller is the absolute owner of the Shares,
free and clear of any Liens.
     4.6 Certain Business Practices: The Seller, and the directors, officers,
agents and employees of the Seller, have not (i) used any Company funds for
unlawful contributions, gifts, entertainment or other unlawful expenses relating
to political activity, campaigns, parties or advertising, (ii) made any unlawful
payment to foreign or domestic government officials or employees or to foreign
or domestic political parties or campaigns or (iii) violated any similar
provision of applicable Law.
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF BUYER
     Buyer hereby represents and warrants to Seller that the statements
contained in this ARTICLE V are true and correct as of the date of this
Agreement and will be true and correct as of the Closing Date (as though made
then and as though the Closing Date were substituted for the date of this
Agreement throughout this ARTICLE V).
     5.1 Corporate Organization. Buyer is a Florida corporation duly formed,
validly existing and in good standing under the Laws of the State of Florida.
Buyer has all requisite corporate power and authority to carry on its business
as it is now being conducted and to own and lease the properties and assets it
now owns and leases.
     5.2 Authorization, Validity and Enforceability. Buyer has full power and
authority to execute and deliver this Agreement and to perform its obligations
hereunder. The execution, delivery and performance of this Agreement has been
duly authorized by Buyer. This Agreement has been duly executed and delivered by
Buyer.
     5.3 Compliance. The execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby by Buyer will not result in
the creation of any lien, charge or encumbrance of any kind or the termination
or acceleration of any indebtedness or other obligation of Buyer and are not
prohibited by, do not violate or conflict with any provision of, do not
constitute a default under or a breach of and do not impair any rights or give
rise to any rights to terminate or modify or to damages or penalties under
(a) the articles of incorporation or bylaws of Buyer, (b) any Indebtedness,
Contract, permit or other instrument to which Buyer is a party or by which Buyer
or any of its assets are bound, (c) any

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Order applicable to Buyer, or (d) any Law applicable to Buyer. There is no
Proceeding or Order (or any basis therefor) pending or, to the knowledge of
Buyer, threatened against or affecting Buyer, which in any manner challenges or
seeks to prevent, enjoin, alter or materially delay the transactions
contemplated by this Agreement.
     5.4 Consents and Approvals. Except as set forth on Schedule 5.4, Buyer need
not give any notice to, make any filing with, or obtain any Consent of any
Governmental Body or any other Person in connection with the execution or
delivery by Buyer of this Agreement or the consummation of any of the
transactions contemplated hereby.
     5.5 Capital Resources. Buyer has, or will have prior to the Closing,
sufficient cash, available lines of credit or other sources of immediately
available funds to enable it to make payment of the Initial Purchase Price and
any other amounts to be paid by it hereunder.
     5.6 Purchase for Investment. Buyer is purchasing the Shares for investment
for its own account and not with a view to, or for sale in connection with, any
distribution thereof. Buyer does not have any contract, undertaking, agreement,
or arrangement with any person to sell, transfer or grant participation to such
person, or to any third persons, with respect to any of the Shares to be
acquired hereunder. Buyer understands that the Shares are not registered under
the Securities Act of 1933 or any applicable state securities Laws and that any
sale, transfer, or other disposition of the Shares must be made only pursuant to
an effective registration under applicable federal and state securities Laws or
an available exemption therefrom. Buyer is an “accredited investor” as defined
by SEC Rule 501 and an “institutional investor” as defined by Florida Law. Buyer
(either alone or together with its advisors) has sufficient knowledge and
experience in financial and business matters so as to be capable of evaluating
the merits and risks of its investment in the Shares and is capable of bearing
the economic risks of such investment. Buyer and its representatives have
examined books, records, and documents furnished or made available to them by
Seller and the Company, and have been given the opportunity to ask such
questions of, and receive answers from, Seller as Buyer has determined are
relevant to the decision to acquire the Shares and invest in the Company. No
compensation or consideration to be paid by Buyer to Seller, the Company, or
their respective Affiliates, or any other Person shall, as among the Parties,
constitute a commission or other remuneration in connection with procuring the
sale or purchase of the Shares or the soliciting of any prospective buyer or
seller for such Shares, unless such person is licensed as a broker-dealer. The
Shares to be acquired hereunder were not offered to Buyer by, and Buyer is not
otherwise aware of, any general advertising or general solicitation in
connection with the sale of the Shares or the Business which is the subject
hereof.
     5.7 Brokerage. Buyer does not have any liability or obligation to pay any
fees or commissions to any broker, finder, or agent with respect to the
transactions contemplated by this Agreement for which Seller could become liable
or obligated.

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ARTICLE VI
COVENANTS
     6.1 Operation of the Business Prior to the Closing and Access to Business.
Except for actions taken pursuant to the prior written consent of Buyer or
actions taken in furtherance of the consummation of the transactions
contemplated by this Agreement, from the date of this Agreement until the
Closing, Seller will cause the Company to:
          (a) conduct the Business in the Ordinary Course of Business consistent
with prior practice during the twelve-month period prior to the date hereof;
          (b) continue to meet the contractual obligations of, and pay
obligations relating to, the Business, as they mature in the ordinary course;
          (c) use commercially reasonable efforts to maintain in the Ordinary
Course of Business the business and operations of the Company, keep available
the services of the current agents of the Company, and maintain the relations
and goodwill with its Producers, customers, licensors, lenders and others having
business relations with the Company;
          (d) give all required notices in connection with, and use its
commercially reasonable efforts to cooperate with Buyer to obtain all Consents
necessary or desirable to consummate the transactions contemplated by the
Agreement and to permit Buyer to operate the Business after the Closing; and
          (e) allow Buyer and its representatives, employees, counsel and
accountants reasonable access, during normal business hours and upon reasonable
notice, to the Books and Records, Contracts, documents and data of the Company,
and to copy and make abstracts from the same; provided, however, such access
will not unreasonably disrupt the normal operations of the Company.
     6.2 NPCIC Dwelling Business. Before and after Closing, the Company will
offer renewal policies to those dwelling fire policies insuring properties
located within the State of Florida remaining in North Pointe Casualty, as those
policies come up for renewal.
     6.3 Conduct of Seller Prior to Closing. From the date of this Agreement
until the Closing, Seller shall not (a) sell, assign, transfer, pledge, encumber
or dispose of any of its Shares, except as expressly permitted by this
Agreement. All Tax sharing, Tax indemnity and Tax allocation Contracts, to which
the Company is a party, will be terminated with respect to the Company on or
before Closing and any rights or obligations of the Company under any such
Contracts will be cancelled or paid on or before Closing.
     6.4 Efforts to Close. Subject to the terms and upon the conditions of this
Agreement, Seller, on the one hand, and Buyer, on the other hand, will use
commercially reasonable efforts to cause all of the conditions to the
obligations of the other to consummate the transactions contemplated hereby (as
specified in ARTICLE VI and ARTICLE VIII of this Agreement) to be met as soon as
practicable after the date of this Agreement.

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     6.5 Cooperation of Third Parties. Where the cooperation of third parties
would be necessary in order for a Party to completely fulfill its obligations
under this Agreement, both Parties will work together to use their commercially
reasonable efforts to cause such third parties to provide such cooperation.
     6.6 Expenses. Except as otherwise expressly provided in this Agreement,
whether or not the transactions contemplated by this Agreement are consummated,
each of Seller and Buyer will bear their own costs and expenses (including legal
fees and expenses) relating to this Agreement and the transactions contemplated
hereby.
     6.7 Publicity. Each Party will consult with the other Party prior to
issuing any press release or otherwise making any public statement with respect
to the transactions contemplated by this Agreement, and will not issue any such
release or make any such statement without written consent from the other Party,
except as required by Law. In the event of a required public statement, the
Party making the statement will give reasonable advance notice of the content
thereof to the other Party and will accept comments thereon to the extent
reasonable. Subject to compliance with the foregoing, after the Closing, Buyer
and Seller shall each be permitted to issue press releases, make public
announcements and communicate with Producers, customers and other Persons
without the consent or participation of the other Party.
     6.8 Confidentiality.
          (a) Each Party to this Agreement will hold in confidence all documents
and information concerning the other parties furnished to it in connection with
the transactions contemplated by this Agreement and not otherwise lawfully
available to it, and will use such information only in connection with such
transactions and, after the consummation of such transactions, only in the
conduct of its business. No Party will release or disclose such documents or
information to any other Person, except to its attorneys, accountants and other
outside consultants in connection with this Agreement, except to the extent such
information was previously known by it, in the public domain through no fault of
such Party, disclosed to it by a third party having no confidentiality
obligation to the other Party, or required by Law to be disclosed. If disclosure
of Confidential Information is made to attorneys, accountants and other outside
consultants in connection with this Agreement, such agents or other
representatives will be bound by the terms of this Section 6.8(a). This
Section 6.8(a) shall be effective as of the Closing Date.
          (b) Prior to the Closing Date, the Confidentiality and Nondisclosure
Agreement, dated as of August 10, 2007 by and between American Strategic
Insurance Corp. and North Pointe Holdings Corp. shall remain in full force and
effect; such Confidentiality and Nondisclosure Agreement will terminate as of
the Closing Date.
          (c) In the event that a Party is requested or required pursuant to
written or oral question or request for information or documents in any
Proceeding or Order to disclose any Confidential Information, such Party will
notify the other Party promptly of the request or requirement so that the other
Party may seek an appropriate protective order or waive compliance with the
provisions of this Section 6.8(c). If, in the absence of a protective order or
the receipt of a waiver hereunder, a Party is, on the advice of counsel,
compelled to disclose any

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Confidential Information to any tribunal, then such Party may disclose the
Confidential Information to the tribunal; provided, however, that such Party
shall, at the cost and expense of the other Party, use its commercially
reasonable efforts to obtain, at the request of the other Party, an Order or
other assurance that confidential treatment will be accorded to such portion of
the Confidential Information required to be disclosed as the other Party shall
designate. The foregoing provisions shall not apply to any Confidential
Information that is generally available to the public immediately prior to the
time of disclosure unless such Confidential Information is so available due to
the improper actions of a Party.
     6.9 Further Assurances. Subject to the terms and conditions of this
Agreement, Seller and Buyer will use their respective commercially reasonable
efforts to take, or cause to be taken, all actions and to do, or cause to be
done, all things necessary or desirable under applicable Laws to consummate the
transactions contemplated by this Agreement. Seller and Buyer agree to execute
and deliver such other documents, certificates, agreements and other writings
and to take such other actions as may be necessary or desirable in order to
consummate or implement expeditiously the transactions contemplated by this
Agreement.
     6.10 Consents and Releases. At or prior to the Closing, Seller shall, and
shall cause the Company to, use its commercially reasonable efforts to cooperate
with Buyer to obtain written Consents from all parties whose Consent is
necessary to the consummation of the transactions contemplated by this Agreement
in accordance with the terms hereof.
     6.11 Notice of Developments.
          (a) If Seller or Buyer becomes aware prior to Closing of any fact or
condition that may constitute a material breach of any representation or
warranty of either Party or may constitute a material breach of any
representation or warranty of either Party if such representation or warranty
were made on the date of the occurrence or discovery of such fact or condition
or on the Closing Date, then the Party that becomes aware of such fact or
condition will promptly notify the other Party of such fact or condition.
          (b) If any event or matter arises after the date of this Agreement
that, if existing or occurring at the date of this Agreement, (i) would have
been required to be set forth or described by Seller in the Disclosure Schedule
or (ii) would have caused a representation or warranty in ARTICLE III to be
violated as of such date, then Seller shall promptly deliver to Buyer a revised
copy of the Disclosure Schedule updated, amended, or otherwise supplemented to
reflect such event or matter; provided, however, that no update, amendment or
supplement to the Disclosure Schedule may be made for other than informational
purposes unless Buyer agrees in writing to include such update, amendment, or
supplement as a revised Disclosure Schedule; provided further, however, that if
Buyer so agrees to revise the Disclosure Schedule for any such update,
amendment, or supplement, such agreement shall operate as a waiver of any claim
under ARTICLE VIII or otherwise by Buyer with respect to the item or items set
forth in such update, amendment, or supplement. All references herein to the
Disclosure Schedule shall, after any such update, amendment, or supplement to
which Buyer has agreed as provided above, include the Disclosure Schedule as so
updated, amended, or supplemented. In the event that Buyer does not agree to
revise the Disclosure Schedule, Seller may proceed to negotiate in good faith
with Buyer an adjustment to the Initial Purchase Price, or other applicable
provisions of this

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Agreement, and, if such negotiations fail, terminate this Agreement without
additional liability. It is anticipated that certain sections of the Disclosure
Schedule will routinely require updating and supplementation between the date
hereof and the Closing Date, and so long as such updating or supplementation
reflects events or matters arising after the date of this Agreement in the
Ordinary Course of Business, and which are not reasonably anticipated to result
in a Material Adverse Effect, Buyer shall not unreasonably withhold or delay
agreement to such updating or supplementation of the Disclosure Schedule.
     6.12 Transition. Seller shall not take any action that is designed or
intended to have the effect of discouraging any Producer, licensor, customer or
other business associate of the Company (other than any Affiliates of Seller)
from maintaining the same business relationships with the Company after the
Closing as it maintained with the Company prior to the Closing.
     6.13 Intellectual Property. On or before the 12 month anniversary of the
Closing Date Buyer shall, and shall cause the Company to (i) change the name of
the Company to a name that does not include the word “Pointe” and (ii) cease all
use of trade names and trade marks that include the name “Pointe” and/or the
design shown on Exhibit 6.13.
ARTICLE VII
CONDITIONS TO SELLER’S OBLIGATION TO CLOSE
     All obligations of Seller to sell the Shares and to perform any other
action at the Closing are subject to the fulfillment, prior to or at the
Closing, of each of the following conditions, any of which may be waived by
Seller in whole or in part.
     7.1 No Injunction/Order. There shall not be any Order in effect preventing
consummation of any of the transactions contemplated by this Agreement or any
Proceeding seeking to restrain, prevent, change or delay the consummation of any
of the transactions contemplated by this Agreement.
     7.2 Regulatory Matters. The authorizations, consents, orders, permits or
approvals of, or declarations or filings with, and all expirations of waiting
periods imposed by, any Governmental Authority which are reasonably necessary
and are identified on Disclosure Schedule 6.1(c) (“Requisite Regulatory
Approvals”), shall have been filed, have occurred or have been obtained and all
such Requisite Regulatory Approvals shall be in full force and effect.
     7.3 Representations and Warranties. As of the Closing Date there shall
exist no material misrepresentation, breach or inaccuracy of any of Buyer’s
representations or warranties in this Agreement.
     7.4 Performance of Obligations. Buyer shall have performed in all material
respects all of its obligations pursuant to this Agreement required to be
performed by it prior to the Closing Date.
     7.5 Payments. At the Closing, Buyer shall have tendered the Initial
Purchase Price and the Reinsurance Premium to Seller.

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     7.6 Transfer of Documents. At the Closing, Buyer shall have tendered the
documents required in Section 9.2 to Seller.
     7.7 Officer Certificate. Buyer shall deliver to Seller at the Closing a
certificate, in form and substance reasonably satisfactory to Buyer, confirming
that each of the conditions specified above in Sections 7.1 through 7.6 is
satisfied
     7.8 Good Faith. In order for any condition precedent in this ARTICLE VII,
the accomplishment of which is within the control of Seller, to be effective for
the benefit of Seller, then Seller shall have exercised its good faith and
commercially reasonable efforts toward the accomplishment of same.
ARTICLE VIII
CONDITIONS TO BUYER’S OBLIGATION TO CLOSE
     All obligations of Buyer to purchase the Shares and to perform any other
action at the Closing are subject to the fulfillment, prior to or at the
Closing, of each of the following conditions, any of which may be waived by
Buyer in whole or in part.
     8.1 Due Diligence. Satisfactory completion by Buyer of its financial,
legal, and other due diligence investigations.
     8.2 Insurance. Insurance and reinsurance coverage satisfactory to Buyer.
     8.3 No Material Adverse Change. During the period from the date of the
Interim Financial Statements through the Closing Date, there shall not have been
a Material Adverse Change to the Company, its financial condition, or its
prospects.
     8.4 No Injunction/Order. There shall not be any Order in effect preventing
consummation of any of the transactions contemplated by this Agreement or any
Proceeding seeking to restrain, prevent, change or delay the consummation of any
of the transactions contemplated by this Agreement.
     8.5 Regulatory Matters. The Requisite Regulatory Approvals shall have been
filed, have occurred or have been obtained and all such Requisite Regulatory
Approvals shall be in full force and effect.
     8.6 Representations and Warranties. As of the Closing Date there shall
exist no material misrepresentation, breach or inaccuracy of any of Seller’s
representations or warranties in this Agreement.
     8.7 Performance of Obligations. Seller shall have performed in all material
respects all of its obligations pursuant to this Agreement required to be
performed by it prior to the Closing Date.
     8.8 Performance of Seller’s Obligations. Seller and the Company shall have
tendered at the Closing the documents required in Section 9.1.

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     8.9 Third-Party Consents. All of the Consents set forth on Schedule 8.9
shall have been obtained on the terms set forth on such Schedule.
     8.10 Officer Certificate. Seller shall deliver to Buyer at the Closing a
certificate, in form and substance reasonably satisfactory to Buyer, confirming
that each of the conditions specified above in Sections 8.1 through 8.3 is
satisfied and that A.M. Best has not communicated to Home Pointe or its
Subsidiaries that its rating of B+ is likely to be modified, qualified, lowered
or placed under such surveillance or review for any reason, other than as a
result of the transactions contemplated hereby.
     8.11 Good Faith. In order for any condition precedent in this ARTICLE VIII,
the accomplishment of which is within the control of Buyer, to be effective for
the benefit of Buyer, then Buyer shall have exercised its good faith and
commercially reasonable efforts toward the accomplishment of same.
     8.12 Contracts with Affiliates. All Affiliate Contracts of any nature
whatsoever shall have been terminated at, or prior to, Closing.
ARTICLE IX
CLOSING DELIVERIES
     9.1 Seller’s Deliveries at or Prior to Closing. Seller will deliver or
cause to be delivered the following to Buyer at or prior to the Closing, all in
form reasonably satisfactory to Buyer’s counsel:
          (a) A copy of the charter of the Company, as amended to date,
certified by the Secretary of State or other appropriate government official of
the jurisdiction of incorporation and dated as of a date not more than ten
(10) days prior to the Closing Date, and a copy of the bylaws of the Company,
certified by the secretary or an assistant secretary of Seller;
          (b) A certificate of good standing of the Company issued by the
Secretary of State or other appropriate government official of Florida, dated
not more than ten (10) days prior to the Closing Date;
          (c) Stock certificates (or equivalent) representing the Shares
together with stock powers or other appropriate instruments of transfers to
convey the same to Buyer;
          (d) A copy of the resolutions of the board of directors of Seller
approving the transfer of the Shares of the Company, certified by the secretary
or assistant secretary of Seller;
          (e) Seller’s Legal Opinion together with the executed officer
certificates referenced therein.
          (f) Payoff and release letters with respect to any Indebtedness of the
Company together with UCC-3 termination statements with respect to financing
statements filed against the Company;

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           (g) The resignations of each of the directors and officers of the
Company;
          (h) The minute books and stock records of the Company;
          (i) The Reinsurance Agreement properly executed by North Pointe
Casualty; and
          (j) All other instruments and documents required by this Agreement to
be delivered by Seller to Buyer, and such other instruments and documents which
Buyer or its counsel may reasonably request in connection with the transactions
contemplated by this Agreement, in each case, as applicable, properly executed
by Seller.
     9.2 Buyer’s Deliveries at or Prior to Closing. Buyer shall deliver or cause
to be delivered the following to Seller, at or prior to the Closing, all in a
form reasonably satisfactory to Seller’s counsel:
          (a) Payment by Buyer of the Initial Purchase Price and the Reinsurance
Premium as provided in Section 2.2 hereof;
          (b) The Power of Attorney and the Reinsurance Agreement, in each case,
properly executed by the Company; and
          (c) All other instruments and documents required by this Agreement to
be delivered by Buyer to Seller, and such other instruments and documents which
Seller or its counsel may reasonably request in connection with the transactions
contemplated by this Agreement and the Reinsurance Agreement in each case, as
applicable, properly executed by Buyer.
ARTICLE X
SURVIVAL OF REPRESENTATIONS AND
WARRANTIES; INDEMNIFICATION
     10.1 General. From and after the Closing, the Parties shall indemnify each
other as provided in this ARTICLE X. The Party seeking indemnification is
sometimes referred to herein as the “Indemnified Party” and the Party against
which indemnification is sought is sometimes referred to as the “Indemnifying
Party.”
     10.2 Survival.
           (a) All representations, warranties, covenants and agreements of the
Parties contained in this Agreement or any officer’s certificate delivered
pursuant to this Agreement will survive the Closing until 12 months after the
Closing Date and thereafter shall expire; provided, however, that (i) the
representations and warranties set forth in Section 3.20 (Tax Matters, Tax
Returns and Tax Audits) and the Tax indemnification set forth in Section 12.3
(Tax Indemnification by Seller) shall survive the Closing Date for the period of
time specified in the applicable statute of limitations and (ii) Sections 3.1
(Organization, Capitalization), 3.2 (Subsidiaries), 3.4 (Authorization,
Validity, and Enforceability), 3.5 (Compliance), 3.8 (Good

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Title), 3.14 (Employees), 3.21 (Brokerage), 4.1 (Corporate Organization), 4.2
(Authorization, Validity and Enforceability), 5.1 (Corporate Organization), 5.2
(Authorization, Validity and Enforceability), 5.3 (Compliance), 5.6 (Purchase
for Investment) and 5.7 (Brokerage) shall survive the Closing Date for so long
as permitted by Law. No claim for indemnification may be initiated under this
ARTICLE X after the expiration of the applicable survival period set forth
above. A claim shall be deemed initiated for purposes of this Section 10.2 upon
the giving of notice as set forth in Section 10.5(a).
     10.3 Indemnification By Seller.
          (a) Seller shall indemnify Buyer for and hold Buyer harmless from and
against any Damages sustained or incurred by Buyer resulting from any breach or
inaccuracy of any representations and warranties, covenants or agreements made
by Seller in this Agreement or in any certificate delivered by Seller herewith.
NPHC hereby guarantees Seller’s obligations hereunder.
          (b) References to Buyer in this Section 10.3 includes its Affiliates,
officers, directors, agents, successors and assigns and, following the Closing,
the Company and its officers, directors, agents, successors and assigns (the
“Buyer Indemnitees”).
     10.4 Indemnification By Buyer.
          (a) Buyer shall indemnify Seller for and hold Seller harmless from and
against any Damages sustained or incurred by Seller resulting from any breach or
inaccuracy of any representations and warranties, covenants or agreements made
by Buyer in this Agreement or in any certificate delivered by Buyer herewith.
Safe Harbour hereby guarantees Buyer’s obligations hereunder.
          (b) References to Seller in this Section 10.4 include its Affiliates,
officers, directors, agents, successors and assigns and, prior to the Closing
(or in the case there is no Closing), the Company and its officers, directors,
agents, successors and assigns (the “Seller Indemnitees”).
     10.5 Claims for Indemnification.
          (a) Promptly upon the Indemnified Party obtaining knowledge of any
facts causing it to believe that it has a claim for indemnification against the
Indemnifying Party hereunder, the Indemnified Party shall give written notice of
such claim to the Indemnifying Party. Such written notice shall set forth in
reasonable detail the nature and (to the extent then known) the amount of the
claim and any other information with respect thereto that the Indemnifying Party
may reasonably request. Notwithstanding the foregoing, the Indemnified Party’s
right of indemnification hereunder shall not be affected by its failure to give
or by its delay in giving such notice unless, and then only to the extent that,
the rights of the Indemnifying Party are materially prejudiced as a result of
such failure or delay.
          (b) The Indemnified Party shall tender to the Indemnifying Party the
defense of any Proceeding brought by any third party (hereinafter “Third Party
Claim”). The Indemnifying Party will have the right to defend the Indemnified
Party against the Third Party

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Claim with counsel of its choice so long as (i) the Indemnifying Party notifies
the Indemnified Party in writing within 10 Business Days after the Indemnified
Party has given notice of the Third Party Claim that, to the extent provided
under this ARTICLE X, the Indemnifying Party will indemnify the Indemnified
Party from and against any Damages the Indemnified Party may suffer resulting
from the Third Party Claim, (ii) the Indemnifying Party provides the Indemnified
Party with evidence reasonably acceptable to the Indemnified Party that the
Indemnifying Party will have the financial resources to defend against the Third
Party Claim and fulfill the Indemnifying Party’s indemnification obligations
hereunder, (iii) the Third Party Claim does not seek an injunction or other
equitable relief, and (iv) settlement of, or an adverse judgment with respect
to, the Third Party Claim is not, in the good faith judgment of the Indemnified
Party, likely to establish a precedential custom of practice adverse to the
continuing business interests or the reputation of the Indemnified Party.
          (c) If the Indemnifying Party assumes the defense and control of any
Third Party Claim, as provided above, the Indemnifying Party shall allow the
Indemnified Party a reasonable opportunity to participate in the defense of such
Third Party Claim with its own counsel and at its own expense. If the
Indemnified Party assumes the defense and control of any Third Party Claim, as
provided above, the Indemnified Party shall allow the Indemnifying Party a
reasonable opportunity to participate in the defense of such Third Party Claim
with its own counsel and at its own expense.
          (d) The Party assuming the defense and control of a Third Party Claim
(the “Controlling Party”) shall take all steps necessary in the defense or
settlement of such Third Party Claim, and shall at all times diligently and
promptly pursue the resolution of such Third Party Claim. The other Party shall,
and shall cause its controlled Affiliates to, cooperate fully with the
Controlling Party in the defense of any Third Party Claim defended by the
Controlling Party, including by making relevant personnel reasonably available
to the Controlling Party in connection with such defense.
          (e) Notwithstanding anything in this Section 10.5 to the contrary,
neither the Indemnifying Party nor the Indemnified Party shall, without the
written consent of the other Party (which consent shall not be unreasonably
withheld or delayed), settle or compromise any Third Party Claim or permit a
default or consent to entry of any judgment unless the claimant provides to such
other party an unqualified release from all liability in respect of the Third
Party Claim. If the Indemnifying Party makes any payment to an Indemnified Party
under this ARTICLE X, the Indemnifying Party shall be subrogated, to the extent
of such payment, to all rights and remedies of the Indemnified Party to any
insurance benefits or other claims of the Indemnified Party with respect to such
Third Party Claim.
          (f) To the extent provided by this ARTICLE X, the Indemnifying Party
shall be liable for the reasonable fees and expenses of counsel incurred by the
Indemnified Party in defending any Third Party Claim prior to the date the
Indemnifying Party assumes control of the defense of the Third Party Claim or if
the Indemnified Party assumes the defense of a Third Party Claim pursuant to
Section 10.5(b). In the event that the Indemnifying Party does not accept the
defense of any Third Party Claim or the Indemnified Party assumes the defense of
a Third Party Claim pursuant to Section 10.5(b), the Indemnified Party shall use
reasonable efforts to inform the Indemnifying Party of material developments
with respect to such Third Party

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Claim and to provide the Indemnifying Party with copies of material filings with
any Governmental Authority in respect of such Third Party Claim that are not
subject to the attorney-client or another similar privilege.
          (g) The Parties shall cooperate with each other in connection with any
Third Party Claim and provide each other with access to relevant personnel,
books, records and other information in their possession.
     10.6 Limitations on Liability of Seller.
          (a) Buyer Indemnitees shall not be entitled to indemnification
pursuant to Section 10.3(a) until the aggregate amount of Seller’s
indemnification obligations to Buyer Indemnitees for Damages pursuant to this
ARTICLE X, determined without regard to this Section 10.6, exceeds $25,000, in
which event Seller’s indemnification obligations shall be for the amount of
Damages from the first dollar of such Damages.
          (b) Notwithstanding anything else to the contrary contained in this
Agreement, Seller’s maximum aggregate indemnification obligations to Buyer
Indemnitees pursuant to Section 10.3(a), collectively, shall not exceed
$2,000,000.
     10.7 Limitations on Liability of Buyer.
          (a) Seller Indemnitees shall not be entitled to indemnification
pursuant to Section 10.4(a) until the aggregate amount of Buyer’s
indemnification obligations to Seller Indemnitees for Damages pursuant to this
ARTICLE X, determined without regard to this Section 10.7, exceeds $25,000, in
which event Buyer’s indemnification obligations shall be for the amount of
Damages from the first dollar of such Damages.
          (b) Notwithstanding anything else to the contrary contained in this
Agreement, Buyer’s maximum aggregate indemnification obligations to Seller
Indemnitees pursuant to Section 10.4(a), collectively, shall not exceed
$2,000,000.
     10.8 Other Indemnification Matters. Any indemnification payments under this
ARTICLE X will be treated by the Parties on their Tax Returns as an adjustment
to the Initial Purchase Price, as adjusted pursuant to Section 2.5, unless a
final determination by a relevant Tax authority causes any such payment not to
be treated as an adjustment to the Initial Purchase Price for Tax purposes.
     10.9 Interest. Any Damages subject to indemnification under this ARTICLE X
shall bear interest from (a) the later of (i) the Indemnifying Party’s receiving
notice of such Damages, and (ii) the date such Damages are sustained or
incurred, until (b) the date on which such Damages are indemnified pursuant to
the provisions hereof, at a rate equal to the lesser of 8% per annum or the
maximum rate permitted by applicable Law. Such interest shall be payable in
immediately available funds upon demand.

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ARTICLE XI
TERMINATION AND ABANDONMENT
     11.1 Termination. This Agreement may be terminated at any time prior to the
Closing:
          (a) by mutual written consent of Seller and Buyer;
          (b) by Buyer (i) in the event the Company or Seller have breached one
or more representations, warranties, or covenants contained in this Agreement
which individually, or in the aggregate, has a Material Adverse Effect or
(ii) upon ten (10) days’ prior written notice first given by the party wishing
to terminate, if the Closing shall not have occurred on or before March 31,
2008, by reason of the failure of any condition precedent under ARTICLE VIII
hereof and such condition precedent has not been satisfied prior to the
expiration of such ten (10) day period (unless the failure results primarily
from Buyer breaching any representation, warranty, or covenant contained in this
Agreement); and
          (c) by Seller (i) in the event Buyer has breached one or more
representation, warranty, or covenant contained in this Agreement which
individually, or in the aggregate, is material to this Agreement or (ii) if the
Closing shall not have occurred on or before December 31, 2007, by reason of the
failure of any condition precedent under ARTICLE VII hereof (unless the failure
results primarily from the Company or Seller breaching any representation,
warranty, or covenant contained in this Agreement).
     11.2 Procedure and Effect of Termination. In the event of termination of
this Agreement and abandonment of the transactions contemplated hereby pursuant
to Section 11.1 hereof, written notice thereof will promptly be given to all
Parties and this Agreement will terminate and the transactions contemplated
hereby will be abandoned, without further action by Seller or Buyer, and without
additional liability on the part of them or their Affiliates, directors,
officers, shareholders, employees, contractors and agents, except for
Sections 6.6, 6.7 and 6.8 and Articles ARTICLE X, ARTICLE XI and ARTICLE XIII
and any definitions pertaining thereto, which provisions will continue
indefinitely to bind the Parties as necessary to effectuate their purpose.
Nothing contained in this Section 11.2 will release the Parties from liability
for any breach of this Agreement prior to its termination; provided, however,
that any Damages recoverable pursuant to this sentence shall be limited to
actual costs and damages and shall not include any punitive or consequential
damages or loss.
ARTICLE XII
TAX MATTERS
     12.1 Cooperation in Tax Matters. For a period of five (5) years after the
Closing, Buyer and Seller will provide cooperation and assistance to each other,
as and to the extent reasonably requested in connection with the filing and
preparation of Tax Returns related to the pre-Closing periods, provided that the
requesting Party pay any out of pocket costs incurred by the other Party in
providing such requested cooperation and assistance. Such cooperation and
assistance will include the retention and (upon the other Party’s request) the
provision of records

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and information that are reasonably relevant to such Tax Returns and making
employees available on a mutually convenient basis to provide additional
information and explanation of any material provided hereunder. Buyer and Seller
will retain all books and records with respect to Tax matters pertinent to the
Company relating to any Tax period beginning before the Closing Date until
30 days after the expiration of the statute or period of limitations applicable
to the respective Tax periods.
     12.2 Responsibility for Preparation and Filing of Tax Returns and
Amendments.
          (a) Seller will timely (taking into account any applicable extension
periods) prepare, or cause to be prepared, and timely (taking into account any
applicable extension periods) file, or cause to be filed, all Tax Returns for
the Company for all Tax periods ending on or prior to the Closing Date that are
filed after the Closing Date. Seller will provide Buyer with copies of any such
Tax Returns for Buyer’s review and comment, at least 30 days prior to the due
date thereof (giving effect to any extensions thereto). Seller will timely
(taking into account any applicable extension periods) pay all Taxes due with
respect to such Tax Returns.
          (b) Buyer will timely (taking into account any applicable extension
periods) prepare, or cause to be prepared, and timely (taking into account any
applicable extension periods) file, or cause to be filed, all Tax Returns for
the Company for Tax periods of the Company that end after the Closing Date;
provided that in no event shall Buyer have the right to prepare any combined,
consolidated, or unitary Income Tax Return or similar Tax Return of Seller or
NPHC that includes the operations of the Company. Buyer will timely (taking into
account any applicable extension periods) pay all Taxes due with respect to such
Tax Returns.
     12.3 Tax Indemnification by Seller. In addition to the indemnification
provisions of ARTICLE X, except to the extent such Taxes are reflected as a
liability for purposes of calculating the Final Book Value, Seller shall
indemnify and hold Buyer Indemnitees harmless from: (a) all Taxes imposed on or
incurred by the Company with respect to all Tax periods ending on or prior to
the Closing Date, and (b) all Taxes of any member of an affiliated,
consolidated, combined or unitary group of which the Company or any of its
Affiliates (or any predecessor of the foregoing) is or was a member before the
Closing Date, including pursuant to Treasury Regulation section 1.1502-6 or any
analogous or similar state, local, or foreign Law. This Section 12.3 shall be
subject to the provisions of Sections 10.2, 10.5 and 10.6.
     12.4 Tax Indemnification by Buyer. Buyer shall indemnify and hold Seller
Indemnitees harmless from any additional Tax owed by Seller (including Tax owed
by Seller as a result of this indemnification payment) resulting from any
transaction engaged in by the Company not in the ordinary course of business
occurring on the Closing Date after Buyer’s purchase of the Shares. Buyer and
Seller agree to report all transactions not in the ordinary course of business
occurring on the Closing Date after Buyer’s purchase of Company’s stock on
Buyer’s federal, state or local Income Tax Returns to the extent permitted by
Treasury Regulation 1.1502-76(b)(1)(ii)(B) or any analogous or similar state,
local or foreign Law.
     12.5 Other Indemnification Matters. Seller and Buyer agree that any
indemnification payments made pursuant to this ARTICLE XII will be treated by
the Parties on their Tax Returns as an adjustment to the Initial Purchase Price,
unless a final determination by a relevant Tax

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authority causes any such payment not to be treated as an adjustment to the
Initial Purchase Price for Tax purposes.
ARTICLE XIII
MISCELLANEOUS PROVISIONS
     13.1 Amendment and Modification. This Agreement, and any Exhibit or
Schedule attached hereto, may be amended, modified and supplemented prior to the
Closing only by the written agreement of Seller and Buyer.
     13.2 Waiver of Compliance. Any failure of Buyer, Seller or the Company to
comply with any obligation, covenant, agreement or condition contained herein
may be expressly waived in writing by Seller or Buyer, respectively, but such
waiver or failure to insist upon strict compliance with such obligation,
covenant, agreement or condition shall not operate as a waiver of, or estoppel
with respect to, any subsequent or other failure.
     13.3 Notices. Each notice, request, demand or other communication by either
Party to the other Party required or permitted by this Agreement (collectively,
a “Notice”) shall be in writing and shall be (a) personally delivered, (b) sent
by U.S. certified mail, return receipt requested, postage prepaid, (c) by a
nationally recognized overnight commercial courier, charges prepaid, or (d) by
facsimile transmission (but each such facsimile transmission shall be confirmed
by sending a copy thereof to the other Party by certified mail or commercial
courier as provided herein no later than the following Business Day), addressed
as set forth below or to such other address as such Party shall have
communicated to the other Party in accordance with this Section 13.3. Any Notice
given in the manner described herein shall be deemed to have been given and
received when personally delivered, on the date of sending when sent by
facsimile transmission, on the third day following the date of sending when sent
by certified mail or on the first day following the date of sending when sent by
commercial courier.
(a) If to Buyer, to:
Mr. John F. Auer, President
American Capital Assurance Corp.
805 Executive Center Dr. West 3rd
St. Petersburg, FL 33702
with a copy to:
G. Kristin Delano
Biber O’Toole Delano Fowler and Clarkson P.L.
360 Central Avenue, Ste 1560
St. Petersburg, FL. 33701
(b) If to Seller, to:
North Pointe Financial Services, Inc.
28819 Franklin Road

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Suite 300
Southfield, MI 48034
Attn: James G. Petcoff, President
Fax: (248) 357-3895
with a copy to:
Honigman Miller Schwartz and Cohn LLP
2290 First National Building
660 Woodward Avenue
Detroit, MI 48226
Attn: Donald J. Kunz, Esq.
Fax: (313) 465-7455
     13.4 No Assignment. This Agreement shall be binding upon and inure to the
benefit of the Parties hereto and their respective successors and assigns, but
neither this Agreement nor any of the rights, interests or obligations hereunder
shall be assigned by either of the Parties hereto without the prior written
consent of the other Party (which shall not be unreasonably withheld); provided
that (a) Buyer may so assign, in whole or in part, its rights and obligations
hereunder to one or more of its wholly-owned Affiliates, and (b) Buyer may
assign and pledge its rights to indemnification hereunder to its lenders or any
agent thereof pursuant to any security agreement entered into in connection with
any loan agreement. Any such assignment will not relieve the Party making the
assignment from any liability under such agreements.
     13.5 Governing Law. This Agreement (including all matters of construction,
validity and performance) and the legal relations among the Parties shall be
governed by the laws of the State of Florida, without regard to principles of
conflicts or choice of law.
     13.6 Waiver of Jury Trial. Each of the Parties acknowledges and agrees that
any controversy that may arise under this Agreement or the transactions
contemplated hereby is likely to involve complicated and difficult issues, and
therefore each such Party hereby irrevocably waives any and all right to trial
by jury in any legal proceeding arising out of or related to this Agreement or
the transactions contemplated hereby.
     13.7 Mediation. In the event that any dispute arises between the Parties in
relation to this Agreement, or out of this Agreement, and such dispute is not
resolved by negotiation between the Parties, the Parties agree to submit the
dispute to non-binding mediation. The Parties further agree that their
participation in mediation is a condition precedent to any Party pursuing any
other available remedy in relation to the dispute. Any Party to the dispute may
give written notice to the other Party of his or her desire to commence
mediation, and a mediation session must take place within thirty (30) days after
the date that such notice is given and must conclude within ninety (90) days
after such notice is given. The Parties must jointly appoint a mutually
acceptable mediator. If the Parties are unable to agree upon the appointment of
a mediator within seven (7) days after a Party has given notice of a desire to
mediate the dispute, any Party may apply to the American Arbitration
Association, or such other organization or person agreed to by the Parties in
writing, for appointment of the mediator. The Parties further

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agree to share equally the costs of the mediation, which costs will not include
costs incurred by a Party for representation by counsel at the mediation.
     13.8 Counterparts; Effectiveness. This Agreement may be executed in
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument. The exchange of copies of
this Agreement and of signature pages by facsimile transmission shall constitute
effective execution and delivery of this Agreement as to the Parties and may be
used in lieu of the original Agreement for all purposes. Signatures of the
Parties transmitted by facsimile shall be deemed to be their original signatures
for all purposes
     13.9 Entire Agreement. This Agreement, including the Exhibits hereto, the
Disclosure Schedule (which constitutes a part of this Agreement as if set forth
in full herein) and the other schedules, documents and certificates delivered
pursuant to the terms hereof, sets forth the entire agreement and understanding
of the Parties hereto in respect of the subject matter contained herein, and
supersedes and cancels all prior agreements, negotiations, promises, covenants,
arrangements, communications, representations or warranties, whether oral or
written, with respect to the subject matter hereof and thereof.
     13.10 Third Party Beneficiaries. Except as specifically provided herein,
nothing contained in this Agreement or in any instrument or document executed by
the Parties in connection with the transactions contemplated hereby shall confer
upon or give to any Person other than the Parties hereto and their successors or
assigns, any rights or remedies under or by reason of this Agreement or such
instrument of document.
     13.11 Construction. Whenever in this Agreement the context so suggests,
references to the masculine shall be deemed to include the feminine and the
neuter, any singular term in this Agreement shall be deemed to include the
plural, and any plural term the singular, and references to “or” shall be deemed
to be disjunctive but not necessarily exclusive. No provision of this Agreement
shall be construed in favor of or against any Party by reason of the extent to
which such Party or its counsel participated in the drafting thereof. References
to Articles, Sections, Exhibits and Schedules are to Articles, Sections,
Exhibits and Schedules of this Agreement unless otherwise specified. All
Exhibits and Schedules annexed hereto or referred to herein are hereby
incorporated in and made a part of this Agreement as if set forth in full
herein. Any capitalized terms used in any Exhibit or Schedule but not otherwise
defined therein, shall have the meaning as defined in this Agreement. The
headings and captions of the Sections and Articles of this Agreement are
inserted for convenience only and shall not constitute a part hereof or affect
in any way the meaning or interpretation of this Agreement. Whenever the words
“include”, “includes” or “including” are used in this Agreement, they shall be
deemed to be followed by the words “without limitation”, whether or not they are
in fact followed by those words or words of like import. “Writing”, “written”
and comparable terms refer to printing, typing and other means of reproducing
words (including electronic media) in a visible form. References to any
agreement or contract are to that agreement or contract as amended, modified or
supplemented from time to time in accordance with the terms hereof and thereof.
References to any Person include the successors and permitted assigns of that
Person. References from or through any date mean, unless otherwise specified,
from and including or through and including, respectively.

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     13.12 Severability. If any term, provision, covenant or restriction of this
Agreement is held by a court of competent jurisdiction or other authority to be
invalid, void or unenforceable, the remainder of the terms, provisions,
covenants and restrictions of this Agreement shall remain in full force and
effect and shall in no way be affected, impaired or invalidated so long as the
economic or legal substance of the transactions contemplated hereby is not
affected in any manner materially adverse to either Party. Upon such a
determination, the Parties shall negotiate in good faith to modify this
Agreement so as to effect the original intent of the Parties as closely as
possible in an acceptable manner in order that the transactions contemplated
hereby shall be consummated as originally contemplated to the fullest extent
possible.
[Signature Page Follows This Page]

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     IN WITNESS WHEREOF, the Parties hereto have executed this Stock Purchase
Agreement as of the day and year first above written.

         
 
            AMERICAN CAPITAL ASSURANCE CORP.  
 
  By:    
 
       
 
  Name:    
 
       
 
  Title:    
 
       
 
            SAFE HARBOUR HOLDINGS, LLC  
 
  By:    
 
       
 
  Name:    
 
       
 
  Title:    
 
       
 
            NORTH POINTE FINANCIAL SERVICES, INC.  
 
  By:    
 
       
 
  Name:   James G. Petcoff
 
       
 
  Title:   President
 
       
 
            NORTH POINTE HOLDINGS CORP.  
 
  By:    
 
       
 
  Name:   James G. Petcoff
 
       
 
  Title:   President
 
       

 

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Exhibits and Schedules
Exhibit 1.35 — List of Employees — Knowledge of Seller
Exhibit 1.48 — Power of Attorney
Exhibit 1.54 — Reinsurance Agreement
Exhibit 1.60 — Form of Seller’s Legal Opinion
Exhibit 6.13 — Intellectual Property
Disclosure Schedule
Schedule 5.4 — Governmental Consent

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Exhibit 1.35
Employees — Knowledge of Seller

  1.   James G. Petcoff, Chief Executive Officer, North Pointe Holdings
Corporation     2.   B. Matthew Petcoff (Chief Operating Officer, Exec. VP, Home
Pointe Insurance Company     3.   Nick Petcoff, Vice President Home Pointe
Insurance Company     4.   Brian Roney, CFO, North Pointe Holdings Corporation  
  5.   Paul Deemer, Chief Actuary, North Pointe Holdings Corporation     6.  
Celeska Fredianelli, Controller, Home Pointe Insurance Company     7.   Rochelle
Kaplan, General Counsel, North Pointe Financial Services, Inc.     8.   L.
Matthew MacLean,, Senior Vice President, Claims, Home Pointe Insurance Company

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Exhibit 1.48
Power of Attorney
See attached.

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Exhibit 1.54
Reinsurance Agreement
See attached.

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Exhibit 1.60
Seller’s Legal Opinion
See attached.

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Exhibit 6.13
Intellectual Property

1.   The name “Home Pointe Insurance Company”.

(NORTH POINTE LOGO) [k21273k2127300.gif]

2.   The tree logo: .

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Disclosure Schedule
Article III
See attached.

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Schedule 5.4
Governmental Consent
1. The Consent Order of the Florida Office of Insurance Regulation approving the
sale of the Shares to the Buyer.

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