exv10w1w27



 





EXHIBIT 10.1.27






August 16, 2004




Mr. Chris Michaels

Chief Executive Officer

American Team Managers Insurance Services, Inc.

1030 North Armando Street

Anaheim, CA 92806




Dear Chris:




     This letter agreement (the “Agreement”) dated as of August 16th, 2004, by
and between American Team Managers Insurance Services, Inc., a California C
Corporation (“ATM”), and Specialty Underwriters’ Alliance, Inc., a Delaware
corporation (“SUA”), confirms the parties’ understanding as to certain terms
and conditions relating to the issuance by SUA to ATM of shares of Class B
Common Stock, par value $.01 per share (the “Class B Stock”).



     SUA and ATM are parties to that certain Securities Purchase Agreement,
dated May 1, 2004 (the “Purchase Agreement”), as amended and restated, whereby
ATM agreed to purchase such number of shares of Class B Stock (the “Shares”) as
determined herein for an aggregate purchase price of $1,000,000.00. Such purchase shall
be contingent on the closing of an Initial Public Offering by SUA. For
purposes hereof, an “Initial Public Offering” shall mean a public equity
offering of the capital stock of SUA in which the proceeds to SUA are not less
than $100,000,000.00, before deduction of underwriting commissions, placement
agent fees or similar charges, and other offering expenses. Capitalized terms
not otherwise defined herein shall have the meanings set forth in the Purchase
Agreement.





     After the closing of a Public Offering, the price of each share of Class B
Stock shall equal the fair market value of one share of SUA’s common stock, par
value $.01 per share (the



 









 





“Common Stock”), on such date, to be calculated as follows: (i) if the Common
Stock is listed or admitted to trading on a national securities exchange, the
last reported sale price of the Common Stock, regular way, on such day or in
case no sale takes place on such day, the average of the reported closing bid
and asked prices of the Common Stock, regular way, on such day, in either case
as reported on such exchange; or (ii) if the Common Stock is not listed or
admitted to trading on any national securities exchange, but is listed on the
NASDAQ




 









 








National Market, the closing sale price of the Common Stock on such day, or in
case no sale is publicly reported for such day, the average of the
representative closing bid and asked quotations for the Common Stock, as
reported on NASDAQ; or (iii) if the Common Stock is not listed or admitted to
trading on the NASDAQ National Market, the average of the bid and asked prices
for the Common Stock as furnished for such day by NASDAQ, or, if not furnished
by NASDAQ, by any New York Stock Exchange, Inc. member firm regularly making a
market in the Common Stock and selected for such purpose by the SUA’s board of
directors.




     Notwithstanding the terms of the Purchase Agreement, the parties hereby
agree that ATM shall pay the Purchase Price in installments as set forth in the
Promissory Note (the “Note”), the terms of which are incorporated herein by
reference. Upon payment by ATM of each installment of the Purchase Price, as
set forth in the Note, SUA shall deliver to ATM such number of shares of Class
B Stock as can be purchased for the amount of such payment, as calculated
above. The date of each payment and delivery of shares of Class B Stock shall
be defined as a “Closing Date.”



     This Agreement may not be amended or changed without the written consent
of SUA and shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and assigns.



	 	 	 	 	 	 	 
	 	 	 	 	Sincerely,
	 
	 	 	 	 	 	 
	 	 	 	 	SPECIALTY UNDERWRITERS’
ALLIANCE, INC.
	 
	 	 	 	 	 	 
	

	 	 	 	By:
	 	/S/ Courtney C. Smith
	

	 	 	 	 	 	
 
	

	 	 	 	 	 	Name: Courtney C. Smith
	

	 	 	 	 	 	Title:   President & CEO
	 
	 	 	 	 	 	 
	ACCEPTED AND AGREED:	 	 	 	 
	 
	 	 	 	 	 	 
	AMERICAN TEAM MANAGERS

INSURANCE SERVICES, INC.	 	 	 	 
	 
	 	 	 	 	 	 
	By:

	 	/S/ Chris Michaels	 	 	 	 
	

	 	
 	 	 	 	 
	

	 	Name: Chris Michaels	 	 	 	 
	

	 	Title:   Chief
Executive Officer