Exhibit 10.1
 nd
 W I T N E S E T H
 WHEREAS,
 WHEREAS,
 WHEREAS,
 NOW THEREFORE,
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The Purchase and Sale Transaction
 Section 1.1. Purchase and Sale of the Shares.
 Section 1.2. Purchase Price.
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ONEBEACON INSURANCE COMPANY
STATE STREET BANK
BOSTON, MASSACHUSETTS
ACCOUNT # 14579981 
ABA # 011-000-028
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Section 1.3. Post-Closing Adjustments to Purchase Price.
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Section 1.4. Closing.
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ARTICLE II.
 Warranties and Representations by the Seller
  Section 2.1. Organization and Qualification of the Seller.
 Section 2.2. Authority Relating to this Agreement.
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Section 2.3. Organization and Qualification of the Company. Schedule
2.3(b),
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Section 2.4. Authority Relating to the Reinsurance Agreement.
  Section 2.5. No Subsidiaries of the Company.
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Section 2.6. Capitalization of the Company.
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Section 2.7. Articles of Incorporation and By-laws.
 Section 2.8. Validity.
   Section 2.9. Governmental Approvals.
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Section 2.10. Financial Statements.
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Section 2.11. No Adverse Change
 Section 2.12. Tax Representations and Warranties
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Section 2.13. Litigation.
 Section 2.14. Collective Bargaining Agreements; Employees.
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Section 2.15. Powers of Attorney and Agents.
 Section 2.16. Assets and Property; No Liabilities.
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Section 2.17. Corporate Records.
   Section 2.18. Business of the Company.
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Section 2.19. Compliance.
 Section 2.20. Brokers or Finders.
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Section 2.21. Contracts
 Section 2.22. Absence of Certain Changes or Events.
      Section 2.23. Status as of the Closing Date.
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ARTICLE III.
 Warranties and Representations by the Purchaser
  Section 3.1. Corporate Existence, Power and Authority.
 Section 3.2. Authority Relating to this Agreement.
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Section 3.3. Validity.
 Section 3.4. Brokers or Finders.
 Section 3.5. Governmental Approvals.
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Section 3.6. Litigation.
 Section 3.7. Name.
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Section 3.8. No Securities Acts Violation.
 Section 3.9. Status as of the Closing Date.
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ARTICLE IV.
 Covenants of the Seller
 Section 4.1. Preservation of Licenses.
 Section 4.2. Dividends and Other Distributions.
 Section 4.3. Access to Records.
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Section 4.4. Notification of Changes and Default.
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Section 4.5. State Regulatory Approvals; Rate and Form Filings.
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Section 4.6. Prohibited Conduct.
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Section 4.7. Deposits.
 Section 4.8. Intercompany Contracts and Indebtedness.
 Section 4.9. Payment of Broker or Finder Fees.
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Section 4.10. Provision and Use of Financial Information.
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ARTICLE V.
 Covenants of the Purchaser
 Section 5.1. Acquisition Statement and Compliance with Illinois Insurance Law.
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Section 5.2. Post-Closing Access.
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Section 5.3. Payment of Broker or Finder Fees.
 ARTICLE VI.
 Conditions Precedent to Obligation of the Purchaser to Close
  Section 6.1. Proceedings Satisfactory.
 Section 6.2 Warranties and Representations of the Seller.
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Section 6.3. Compliance with Covenants.
 Section 6.4. No Proceedings Pending.
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Section 6.5. Directors and Officers.
 Section 6.6. Regulatory Approvals.
 Section 6.7. Delivery of Certificates for the Shares.
 Section 6.8. Intercompany Balances; Assumed Reinsurance.
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Section 6.9. Delivery of Closing Documents.
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Section 6.10. Capital and Surplus.
 Section 6.11. Financing.
 Section 6.12. Preparation of Quarterly Statement.
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ARTICLE VII.
 Conditions Precedent to Obligation of the Seller to Close
  Section 7.1 Proceedings Satisfactory.
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Section 7.2. Warranties and Representations.
 Section 7.3. Compliance with Covenants.
 Section 7.4. No Proceedings Pending.
 Section 7.5. Regulatory Approvals.
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Section 7.6. Payment of Purchase Price.
 ARTICLE VIII.
 Indemnification
 Section 8.1. Indemnity by the Seller.
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Section 8.2. Valuation of Claim.
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Section 8.3. Payment of Indemnification Loss.
 Section 8.4 Indemnity by the Purchaser.
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ARTICLE IX
 Tax Matters
 Section 9.1 Definitions.
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Section 9.2 Tax Returns and Payments.
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Section 9.3 Adjustments
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Section 9.4 Cooperation; Furnishing of Information
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Section 9.5 Record Retention
 Section 9.6 Code § 338(h)(10) Election
 Section 9.7 Tax Indemnification.
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ARTICLE X.
 Actions to be Taken at Closing;
 Modification; Waivers and Termination
 Section 10.1. Closing.
 Section 10.2. Modification.
 Section 10.3. Waivers.
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Section 10.4. Termination.
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ARTICLE XI.
 Miscellaneous Provisions
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Section 11.1. Expenses.
 Section 11.2. Schedules: this Agreement.
 Section 11.3. Survival of Obligations.
 Section 11.4. Amendments and Waivers
 Section 11.5. Other Instruments to be Executed.
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Section 11.6. Public Statements; Confidentiality
 Section 11.7. Parties Bound.
 Section 11.8. Governing Law.
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Section 11.9. Waiver of Jury Trial. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY WAIVES ANY
AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF, RELATED TO OR IN CONNECTION
WITH THIS
AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
 Section 11.10. Exclusive Jurisdiction and Consent to Service of Process.
 Section 11.11. Notices
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If to the Seller:Attention:
    
    John Paul CavooresPresident and CEOOneBeacon Insurance CompanyOne Beacon StreetBoston, Massachusetts 02108-3100Telecopier: 877-659-4054Copy to:
    
    Donald A. Emeigh, Jr., ExecutiveVice President, General Counsel and SecretaryFolksamerica Holding Company, Inc.One Liberty Plaza, 19th FloorNew York, NY 10006Telecopier: 212-732-5614If to the Purchaser:Attention:
    
    Courtney C. SmithPresident and Chief Executive OfficerSpecialty Underwriters Alliance, Inc.8585 Stemmons FreewaySuite 200, South TowerDallas, Texas 10038Telecopier: 214-889-8800Copy to:
    
    William W. RosenblattStroock & Stroock & Lavan LLP180 Maiden LaneNew York, New York 10038Telecopier: 212-806-1340
 Section 11.12. Number and Gender of Words.
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Section 11.13. Invalid Provisions
 Section 11.14. Accounting Terms
 Section 11.15. Entirety of Agreement
 Section 11.16. Multiple Counterparts; Effectiveness.
 Section 11.17. Assignment.
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Section 11.18. Headings.
 Section 11.19. Third Party Beneficiaries.
 Section 11.20. Negotiated Agreement.
 Section 11.21 Other Remedies.
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SELLER:
ONEBEACON INSURANCE COMPANYBy:
    /s/ Gregory P. WinnName:
    Gregory P. WinnTitle:
    Vice President and TreasurerPURCHASER:
SPECIALTY UNDERWRITERS ALLIANCE, INC.By:
    /s/ Courtney C. SmithName:
    Courtney C. SmithTitle:
    President 61




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Instrument OneBeacon Potomac Parties Party
 WITNESSETH:
  Sale Purchaser
 Transfer and Assumption
  Illinois Department provided, Effective Date
  provided Policyholders Surplus Retained
Assets




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Retained Business
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Exhibit A,
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ONEBEACON INSURANCE COMPANY
    
    
    
    POTOMAC INSURANCE COMPANY OF ILLINOISBy:
    
    /s/ Gregory P. Winn
    
    
    
    By:
    
    /s/ Gregory P. WinnVice President & Treasurer
    
    
    
    
    
    Vice President & Treasurer[SEAL]
    
    
    
    [SEAL]
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Exhibit A to Instrument of Transfer and Assumption
 
 Potomac Policy Policies OneBeacon
    [Name]
 [ ]  [ ]
  By:John Paul CavooresPresident and CEOBy:
    
    
    
    [SEAL]Dennis Robert SmithSecretaryCopy to [Insert Agent of Record]