SUBROGATION AND SALVAGE THAT MAY
ACCRUE WITH REGARD TO CLAIMS ACTUALLY PAID BY THE COMPANY UNDER THE POLICIES AND
NOT PAID BY NATIONAL UNION UNDER THE INDEMNITY SET FORTH IN THIS AGREEMENT.
2.5
SIMULTANEOUSLY WITH THE EXECUTION AND
DELIVERY OF THIS AGREEMENT, NATIONAL UNION, THE COMPANY AND EACH INSURED SHALL
ENTER INTO A NOVATION ENDORSEMENT, IN THE FORM ATTACHED HERETO AS EXHIBIT A, FOR
EACH OF THE POLICIES.
SUCH NOVATION ENDORSEMENT SHALL PROVIDE FOR THE
SUBSTITUTION OF NATIONAL UNION FOR THE RELEVANT COMPANY AS STATED IN SECTION 2.4
OF THIS ARTICLE AND FOR THE EXPRESS AGREEMENT OF SUCH INSURED TO SUCH
SUBSTITUTION.
2.6
THE COMPANY, THE INSURED AND NATIONAL UNION
AGREE THAT, AS OF THE EFFECTIVE DATE, THE FOLLOWING AGREEMENTS (TOGETHER WITH
ANY AND ALL OTHER AGREEMENTS RELATING TO THE POLICIES, COLLECTIVELY, THE
"RELATED AGREEMENTS") ARE HEREBY TERMINATED AND RELEASED FOR ALL PURPOSES:
(I)
THAT CERTAIN INSURANCE PROGRAM AGREEMENT ENTERED INTO BY THE COMPANY AND THE
INSURED AND EFFECTIVE AS OF JANUARY 1. 2001 (THE "INSURANCE PROGRAM AGREEMENT"),
(II) ANY THIRD PARTY ADMINISTRATOR OR CLAIM AGREEMENT RELATED TO THE POLICIES;
THE (III) WAHI AGREEMENT, (IV) THE REINSURANCE TRUST AGREEMENT AND (V) THE TRUST
AGREEMENT .
AS OF THE EFFECTIVE DATE, LABOR READY SHALL CEASE TO BE A
POLICYHOLDER OR MEMBER OF THE COMPANY, AND DOES HEREBY IMMEDIATELY RELEASE AND
DISCHARGE THE COMPANY FROM ANY AND ALL DUTIES, OBLIGATIONS AND LIABILITIES UNDER
THE RELATED AGREEMENTS, AND THE COMPANY DOES HEREBY IMMEDIATELY RELEASE AND
DISCHARGE LABOR READY FROM ANY AND ALL DUTIES, OBLIGATIONS AND LIABILITIES UNDER
THE RELATED AGREEMENTS.
AS OF THE EFFECTIVE DATE, ANY FUNDS HELD BY ANY THIRD
PARTY PURSUANT TO SUCH RELATED AGREEMENTS SHALL BE THE SOLE AND EXCLUSIVE
PROPERTY, RIGHT AND TITLE OF LABOR READY.
5
ARTICLE III
TERM, TERRITORY AND CONDITIONS PRECEDENT
3.1
THIS AGREEMENT SHALL BE MADE EFFECTIVE AS OF
DECEMBER 29, 2004 (THE "EFFECTIVE DATE").
3.2
THIS AGREEMENT SHALL APPLY TO ALL
TERRITORIES COVERED UNDER THE POLICIES.
3.3
THE FOLLOWING SHALL BE DEEMED CONDITIONS
PRECEDENT TO CONSUMMATION OF THE TRANSACTIONS CONTEMPLATED UNDER THIS AGREEMENT:
(A)
THE COMPANY AND LABOR READY SHALL HAVE
EXECUTED THAT CERTAIN SETTLEMENT AGREEMENT AND RELEASE (THE "SETTLEMENT
AGREEMENT") DATED AS OF THE EFFECTIVE DATE;
(b)
Labor Ready and National Union shall have
executed that certain Indemnification Agreement (the "Indemnification
Agreement") dated as of the Effective Date;
(C)
ALL OTHER TERMS AND CONDITIONS SET FORTH IN
THIS AGREEMENT AND REQUIRED TO BE PERFORMED PRIOR TO THE EFFECTIVENESS OF THIS
AGREEMENT SHALL HAVE BEEN SATISFIED.
3.4
NATIONAL UNION'S ASSUMPTION OF THE POLICIES
FROM THE COMPANY, THE COMPANY'S ASSIGNMENT AND TRANSFER OF THE POLICIES TO
NATIONAL UNION, THE COMPANY'S RETURN OF COLLATERAL TO LABOR READY, AND THE
SATISFACTION OF THE OTHER TERMS AND CONDITIONS SET FORTH IN SECTION 3.3 HEREOF,
EACH PURSUANT TO THE TERMS OF THIS AGREEMENT, SHALL OCCUR CONTEMPORANEOUSLY.
ARTICLE IV
CONSIDERATION
4.1
EXCEPT AS OTHERWISE PROVIDED IN SECTION 2.4,
AS CONSIDERATION FOR THE NOVATION AND ASSUMPTION BY NATIONAL UNION OF ALL THE
COMPANY'S LIABILITIES AND OBLIGATIONS UNDER THE POLICIES IN