Document:

EX-10.09 STOCK PURCHASE AGREEMENT

 

EXHIBIT 10.09

STOCK PURCHASE AGREEMENT

by and between

ATLANTIC AMERICAN CORPORATION

and

COLUMBIA MUTUAL INSURANCE COMPANY

Dated December 26, 2007

ii 

 

TABLE OF CONTENTS

	 	 	 	 	 
	 	 	Page
	ARTICLE I PURCHASE AND SALE OF THE SHARES; THE CLOSING
	 	 	1	 
	1.1 Purchase and Sale of the Shares 
	 	 	1	 
	1.2 Post-Closing Adjustment 
	 	 	1	 
	1.3 Time and Place of the Closing 
	 	 	2	 
	1.4 Deliveries by Seller at the Closing 
	 	 	2	 
	1.5 Deliveries by Purchaser at the Closing 
	 	 	2	 
	 
	 	 	 	 
	ARTICLE II REPRESENTATIONS AND WARRANTIES 
	 	 	2	 
	2.1 Representations and Warranties of Seller 
	 	 	2	 
	2.2 Representations and Warranties of Purchaser 
	 	 	7	 
	 
	 	 	 	 
	ARTICLE III OTHER AGREEMENTS 
	 	 	8	 
	3.1 Conduct of Business Pending Closing 
	 	 	8	 
	3.2 Regulatory Filings and Approvals
	 	 	10	 
	3.3 Access 
	 	 	10	 
	3.4 Further Actions
	 	 	11	 
	3.5 Notice of Proceedings 
	 	 	11	 
	3.6 Non-Solicitation 
	 	 	11	 
	3.7 Certain Tax Matters
	 	 	11	 
	3.8 Employee Matters 
	 	 	12	 
	3.9 Delivery of 2007 Audited Statements 
	 	 	12	 
	3.10 Retained Litigation
	 	 	12	 
	3.11 Fees for Seller Services 
	 	 	12	 
	 
	 	 	 	 
	ARTICLE IV CONDITIONS TO CLOSING 
	 	 	13	 
	4.1 Conditions to Obligations of Seller 
	 	 	13	 
	4.2 Conditions to Obligations of Purchaser 
	 	 	13	 
	 
	 	 	 	 
	ARTICLE V TERMINATION, AMENDMENT AND WAIVER 
	 	 	15	 
	5.1 Termination 
	 	 	15	 
	5.2 Effect of Termination; Termination Fee
	 	 	15	 
	5.3 Amendment 
	 	 	16	 
	5.4 Extension; Waiver 
	 	 	16	 
	 
	 	 	 	 
	ARTICLE VI GENERAL PROVISIONS 
	 	 	16	 
	6.1 Survival of Representations, Warranties and Agreements 
	 	 	16	 
	6.2 Indemnification
	 	 	16	 
	6.3 Notices 
	 	 	19	 
	6.4 Fees and Expenses 
	 	 	20	 
	6.5 Interpretation 
	 	 	20	 
	6.6 Governing Law 
	 	 	20	 
	6.7 Counterparts 
	 	 	20	 
	6.8 Entire Agreement 
	 	 	20	 
	6.9 Assignment 
	 	 	20	 

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	 	 	Page
	6.10 Binding Effect 
	 	 	20	 
	6.11 Severability 
	 	 	20	 
	6.12 Publicity 
	 	 	20	 
	6.13 Subsequent SEC Filings 
	 	 	20	 
	6.14 Authorship 
	 	 	20	 

     Exhibit A            Form of Non-Competition Agreement

ii 

 

STOCK PURCHASE AGREEMENT

     This STOCK PURCHASE AGREEMENT (the “Agreement”) is made and entered into as of this 26th day
of December, 2007, by and between ATLANTIC AMERICAN CORPORATION, a Georgia corporation (“Seller”),
and COLUMBIA MUTUAL INSURANCE COMPANY, a Missouri corporation (“Purchaser”).

     WHEREAS, upon and subject to the terms and conditions set forth herein, Seller wishes to sell
to Purchaser, and Purchaser wishes to purchase from Seller, all of the issued and outstanding
shares of stock (the “Shares”) of GEORGIA CASUALTY & SURETY COMPANY, a Georgia corporation
(“Georgia Casualty”), ASSOCIATION CASUALTY INSURANCE COMPANY, a Texas corporation (“Association
Casualty”) and ASSOCIATION RISK MANAGEMENT GENERAL AGENCY, INC., a Texas corporation (“ARMGA” and
collectively with Georgia Casualty and Association Casualty, the “Subsidiaries”), each a
wholly-owned subsidiary of Seller; and

     WHEREAS, Seller owns 100% of the outstanding capital stock of Georgia Casualty, Association
Casualty and ARMGA;

     NOW, THEREFORE, in consideration of the premises and the mutual representations, warranties,
covenants and promises contained herein and other good and valuable consideration, the parties
hereto agree as follows:

ARTICLE I

PURCHASE AND SALE OF THE SHARES; THE CLOSING

     1.1  Purchase and Sale of the Shares. Subject to the terms and conditions of this
Agreement, at the Closing (as hereinafter defined), Seller shall sell, assign, transfer and deliver
to Purchaser, and Purchaser shall purchase from Seller, all of the Shares, and Purchaser shall pay
to Seller as consideration therefor the following amounts, subject to adjustment pursuant to
Section 1.2 and, if applicable, Section 4.2(h) (collectively, the “Purchase Price”):

          (a) in respect of Georgia Casualty and Association Casualty, an amount equal to the statutory
capital and surplus of Georgia Casualty and Association Casualty as of December 31, 2007 to be set
forth in the 2007 Annual Statement and computed in accordance with NAIC statutory accounting
principles applied on a basis consistent with the December 31, 2006 statutory Annual Statement (the
“Unaudited Statutory Capital and Surplus”), plus Four Million Five Hundred Thousand Dollars
($4,500,000) to be allocated proportionally between the companies based upon the audited capital
and surplus of said companies as of December 31, 2007.

          (b) in respect of ARMGA, an amount equal to the GAAP book value of ARMGA as of December 31,
2007.

     1.2 Post-Closing Adjustment. Upon Seller’s delivery to Purchaser of the 2007 Audited
Statements in accordance with Section 3.9:

          (a) if the Unaudited Statutory Capital and Surplus exceeds the audited statutory capital and
surplus of Georgia Casualty and Association Casualty as of December 31, 2007 as set forth in the
2007 Audited Statements and computed in accordance with NAIC statutory accounting principles
applied on a basis consistent with the December 31, 2006 statutory Annual Statement (the “Audited
Statutory Capital and Surplus”), then Seller shall pay to Purchaser the difference between the
Unaudited Statutory Capital and Surplus and the Audited Statutory Capital and Surplus by means of a
wire transfer of immediately available funds to such bank account in the United States as
designated by Purchaser within two (2) days after the 2007 Audited Statements are delivered; and

          (b) if the Audited Statutory Capital and Surplus exceeds the Unaudited Statutory Capital and
Surplus, then Purchaser shall pay to Seller the difference between the Audited Statutory Capital
and Surplus and the Unaudited Statutory Capital and Surplus by means of a wire transfer of
immediately available funds to such bank
account in the United States as designated by Seller within two (2) days after the 2007
Audited Statements are delivered.

 

 

     1.3 Time and Place of the Closing. Subject to the terms and conditions of this
Agreement, the closing of the transactions contemplated by this Agreement (the “Closing”) shall
take place within five business days following the satisfaction or waiver of the conditions to
Closing set forth herein, but in any event no later than March 31, 2008, unless the regulatory
approvals required pursuant to Article IV have not been obtained by such date in which case the
Closing shall take place no later than the date mutually agreed to in writing by Purchaser and
Seller to provide for additional time to obtain such approvals, or such other later date as
mutually agreed in writing by Purchaser and Seller (the “End Date”), at 9:30 a.m., EST (the date
and time of the Closing being referred to herein as the “Closing Date”) at the offices of Troutman
Sanders LLP in Atlanta, Georgia.

     1.4 Deliveries by Seller at the Closing. At the Closing, Seller shall deliver, or
cause to be delivered, to Purchaser (i) certificates representing all of the Shares, duly endorsed
in blank or accompanied by stock powers duly executed in blank, and (ii) unless previously
delivered, all other documents required herein to be delivered by Seller at the Closing.

     1.5 Deliveries by Purchaser at the Closing. At the Closing, Purchaser (i) shall pay
to Seller the Purchase Price by means of a wire transfer of immediately available funds to such
bank account in the United States as designated by Seller; and (ii) shall deliver to Seller, unless
previously delivered, all other documents required herein to be delivered by Purchaser to Seller at
the Closing.

ARTICLE II

REPRESENTATIONS AND WARRANTIES

     2.1 Representations and Warranties of Seller. Seller hereby represents and warrants
to Purchaser as follows:

          (a) Organization and Good Standing. Seller and each of the Subsidiaries are duly
organized, validly existing and in good standing under the laws of their respective jurisdiction of
organization.

          (b) Corporate Authorization. This Agreement has been duly authorized, executed and
delivered by or on behalf of Seller and Seller is duly authorized to enter into this Agreement, to
perform its respective obligations hereunder, and to consummate the transactions contemplated
hereby.

          (c) Enforceability. This Agreement is a legal, valid and binding obligation of
Seller, enforceable against Seller in accordance with its terms except as may be limited by
bankruptcy, insolvency or other similar laws affecting the enforcement of creditors’ rights
generally or general principles of equity.

          (d) Non-Contravention. Neither the execution and delivery of this Agreement by Seller
nor the consummation by Seller of the transactions contemplated hereby will constitute a material
violation of or a material default under, or materially conflict with, (i) the articles of
incorporation, bylaws or other organizational or governing documents of Seller or the Subsidiaries,
(ii) any law, judgment, decree, order, regulation or rule of any court or governmental agency or
authority applicable to Seller or the Subsidiaries or any of their respective properties or assets
(collectively, “Applicable Law”), or (iii) any indenture, mortgage, loan or credit agreement, or
any material contract, commitment, agreement, understanding, arrangement or restriction of any kind
by which Seller or the Subsidiaries is bound, other than the Pledge Agreement (defined below) or
the Guaranty Agreement (defined below).

          (e) Brokerage. No broker, finder or other similar independent agent other than
Benfield Advisory Inc. has acted for Seller in connection with this Agreement and the transactions
contemplated hereby. All fees payable to Benfield Advisory, Inc. in connection with the
transactions contemplated by this Agreement shall be paid by Seller.

          (f) Capitalization. Georgia Casualty’s authorized capital stock consists solely of
10,000,000 shares of common stock, par value $1.00 per share, 2,000,000 of which are currently
issued and outstanding. Association
Casualty’s authorized capital stock consists solely of 1,500,000 shares of common stock, par
value $2.00 per share, 900,000 of which are currently issued and outstanding. ARMGA’s authorized
capital stock consists solely of 100,000 shares of common stock, par value $1.00 per share, 1,000
of which are currently issued and outstanding. Pursuant to a pledge agreement by and between
Seller and Wachovia Bank, National Association (“Bank”) dated as of December 22,

2

 

2006 (the “Pledge
Agreement”), Seller has pledged the Shares of Georgia Casualty and Association Casualty to Bank.
On the date hereof, no other liens, charges, proxies, encumbrances or security interests
(collectively, “Liens”) exist on the Shares and, except for the Pledge Agreement, Seller has title
to the Shares free and clear of all Liens. In accordance with Section 4.2(f), Seller shall cause
Bank to release the Shares from the Pledge Agreement prior to or at the Closing so that, at the
time Seller transfers the Shares held by it to Purchaser, Seller shall have title to the Shares,
free and clear of all Liens. The Shares constitute all of the issued and outstanding shares of
capital stock of the Subsidiaries, and there are no outstanding options, warrants or rights to
purchase from Seller or the Subsidiaries any shares of capital stock of the Subsidiaries.

          (g) Transfer of Title of Shares. The transfer of the Shares to Purchaser in
accordance with the terms of this Agreement will pass title to the Shares to Purchaser, free and
clear of all Liens, other than Liens which may arise other than by reason of the actions or
inactions of Seller.

          (h) Qualification. Each of the Subsidiaries is duly qualified or licensed to do
business and is in good standing in each jurisdiction listed on Schedule 2.1(h).

          (i) SEC Filings and Financial Statements.

          (i) Seller has heretofore delivered to Purchaser copies of Seller’s (x) Annual Report
on Form 10-K for the fiscal year ended December 31, 2006, (y) Quarterly Report on Form 10-Q
for the fiscal quarter ended September 30, 2007. Since December 31, 2005, Seller has timely
filed all reports, registration statements and other documents required to be filed with the
SEC under the rules and regulations of the SEC, and all such reports, registration
statements and other documents have complied in all material respects, as of their
respective filing and effective dates, as the case may be, with all applicable requirements
of the Securities Act of 1933, as amended (the “Securities Act”) and the Securities Exchange
Act of 1934, as amended. As of their respective filing and effective dates, none of such
reports, registration statements or other documents contained any untrue statement of a
material fact or omitted to state a material fact required to be stated therein or necessary
in order to make the statements therein, in light of the circumstances under which they were
made, not misleading.

          (ii) Seller has delivered, or to the extent applicable with respect to the 2007 Annual
Statement will deliver prior to the Closing, to Purchaser complete and correct copies of the
following statutory financial statements:

          (A) the Annual Statements of Georgia Casualty filed with the Georgia Insurance
Department and Association Casualty filed with the Texas Insurance Department for
the years ending December 31, 2004, 2005 and 2006 and, in the event that the Closing
occurs after March 1, 2008, for the year ending December 31, 2007 (the “2007 Annual
Statement”), together with the exhibits and schedules thereto (collectively, the
“Annual Statements”);

          (B) the Quarterly Statements of Georgia Casualty filed with the Georgia
Insurance Department and of Association Casualty filed with the Texas Insurance
Department for the quarters ending March 31, 2007, June 30, 2007 and September 30,
2007, together with the exhibits and schedules thereto (collectively, the “Quarterly
Statements”); and

          (C) the audited statutory balance sheets of Georgia Casualty and Association
Casualty on an unconsolidated basis as of and for the years ended December 31, 2004,
2005 and
2006, and the audited statutory statements of operations, changes in capital
and surplus, and cash flows of Georgia Casualty and Association Casualty on an
unconsolidated basis as of and for the years ended December 31, 2004, 2005 and 2006
(such financial statements, including all notes and schedules thereto, the
independent auditors’ report of Deloitte & Touche LLP thereon (with respect to the
financial

3

 

statements for the years ended December 31, 2004 and 2005) and the
independent auditors’ report of BDO Seidman, LLP thereon (with respect to the
financial statements for the years ended December 31, 2006), being the “Audited
Statutory Statements”) (the balance sheet as of December 31, 2006 included in the
Audited Statutory Statements is referred to herein as the “2006 Balance Sheet”).

The statutory financial statements contained in the Annual Statements (and with
respect to clause (ii) below, other items contained in the Annual Statements) and
the Audited Statutory Statements (i) have been prepared in conformity with SAP using
comparable estimates and assumptions applied on a consistent basis with the December
31, 2006 financial statements, except that the financial statements contained in the
Quarterly Statements are unaudited, (ii) are true, correct and complete and in
accordance with the books and records of Georgia Casualty and Association Casualty,
and (iii) present fully and fairly, on a SAP basis, the financial condition, assets
and liabilities of each of Georgia Casualty and Association Casualty, as the case
may be, as of the respective dates thereof and the results of operations and cash
flows for the respective periods indicated. The financial statements contained in
the Quarterly Statements include all adjustments necessary for a fair presentation
of the financial position of each of Georgia Casualty and Association Casualty,
respectively, and the results of their respective operations for the interim period
presented, subject to normal recurring year-end adjustments and the omission of
footnote disclosures.

          (j) Absence of Certain Changes. Since September 30, 2007, there has been no
occurrence having, or which would reasonably be expected to result in, a Material Adverse Effect on
the Subsidiaries. Since September 30, 2007, the business of the Subsidiaries has been conducted
only in the ordinary and usual course consistent with past practice, except with respect to the
transactions contemplated by this Agreement. A “Material Adverse Effect” shall mean any condition,
change or effect (or series of related conditions, changes or effects) that individually or in the
aggregate is substantially or significantly different from the usual and customary norms of the
condition specified, or which is substantially or significantly adverse to (i) the business,
operations, condition (financial or otherwise) or results of operations of the person specified;
(ii) the validity or enforceability of this Agreement; or (iii) the ability of either of the
parties to perform their obligations under this Agreement, provided, however, that a Material
Adverse Effect shall not include changes generally affecting companies operating in the industry in
which the person specified operates or any general economic conditions, except to the extent that
such changes disproportionately have a greater adverse impact on the person specified as compared
to the adverse impact such changes have on other persons operating in the same industry.

          (k) Reserves. All losses and loss adjustment expenses established and reflected in
the Annual Statement for the year ended December 31, 2006, the Quarterly Statement for the quarter
ended September 30, 2007 and the 2006 Balance Sheet in respect of the Subsidiaries’ insurance
policies were determined in accordance with generally accepted actuarial standards, were based on
actuarial estimates and assumptions that were reasonable and appropriate to the relevant insurance
policies and were recorded in compliance with the applicable requirements of the Georgia Insurance
Code and the Texas Insurance Code, as applicable, and each of the foregoing statements will be true
with respect to the 2007 Annual Statement upon its completion, and make good, sufficient and
adequate provision (under commonly accepted actuarial standards consistently applied and fairly
stated in accordance with sound actuarial principles) to cover the total amount of all reasonably
anticipated claims, expenses and other liabilities of the Subsidiaries under all policies issued by
said Subsidiaries on the respective dates of said Annual Statements, and Quarterly Statement,
including the 2007 Annual Statement upon its completion.

          (1) Tax Matters.

          (i) Each of the Subsidiaries has filed all Tax Returns and all income and other
material Tax Returns that they were required to file. All such Tax Returns were correct and
complete in all material respects. All Taxes shown as due on such Tax Returns have been
paid. There are no liens for Taxes (other than Taxes not yet due and payable) upon any of
the assets of the Subsidiaries.

          (ii) The United States federal income Tax Returns of the Subsidiaries and the Seller
have not been audited or examined by the U.S. Internal Revenue Service and no waivers of
statute of limitations have

4

 

been given with respect to any Taxes of the Subsidiaries. There
is no material dispute or claim concerning any Tax liability of the Subsidiaries claimed or
raised by any Tax authority.

          (iii) None of the Subsidiaries is a party to any agreement, contract, arrangement, or
plan that has resulted or would result in the payment of any “excess parachute payment”
within the meaning of Section 280G of the Internal Revenue Code of 1986, as amended (the
“Code”). None of the Subsidiaries has been a United States real property holding
corporation within the meaning of Code Section 897(c)(2) during the applicable period
specified in Code Section 897(c)(1)(A)(ii). The Subsidiaries are currently members of a
consolidated group for federal income tax purposes of which Seller is the parent corporation
and are also parties to a tax sharing agreement. Except with respect to the members of such
group, none of the Subsidiaries is a party to or bound by any tax allocation or sharing
agreement or has liability for the Taxes of any person under Treas. Regs Section 1.1502-6 as
a transferee or successor, by contract, or otherwise.

          (iv) None of the Subsidiaries has distributed stock of another person, or has had its
stock distributed by another person, in a transaction that was purported or intended to be
governed in whole or in part by Code Section 355 or Code Section 361.

          (v) None of the Subsidiaries has been or is presently in material violation of any
applicable law relating to the payment or withholding of taxes. Each of the Subsidiaries
has duly and timely withheld from employee salaries, wages or other compensation and paid
over to the appropriate taxing authorities all amounts required to be so withheld and paid
over for all periods under all applicable laws.

               For purposes of this Agreement, “Tax” or “Taxes” means any federal, state, local, or foreign
income, gross receipts, license, payroll, employment, excise, severance, stamp, occupation,
premium, windfall profits, environmental, customs duties, capital stock, franchise, profits,
withholding social security, unemployment, real property, personal property, sales, use, transfer,
registration, value added, alternative or add-on minimum, estimated, or other tax of any kind
whatsoever, including any interest, penalty, or addition thereto, whether disputed or not.

               For purposes of this Agreement, “Tax Return” means any return, declaration, report, or
information return or statement relating to taxes, including any schedule or attachment thereto,
and including any amendment thereto.

          (m) Pending Litigation or Proceedings. Except for claims under insurance contracts
against the Subsidiaries in the ordinary course of business, there are no claims, suits, actions,
proceedings, arbitrations or investigations now pending, or to the Knowledge of Seller threatened,
against or otherwise relating to or involving any of the Subsidiaries or any of their properties,
the outcome of which would reasonably be expected to have a Material Adverse Effect on the
Subsidiaries. With respect to the Subsidiaries (i) no investigation or examination by any
insurance regulatory authority is pending, and (ii) no such investigation or examination has
occurred since the date upon which Seller acquired the Shares, other than routine insurance
department exams. With respect to the Subsidiaries, no fine or penalty imposed by an insurance
regulatory authority since the date upon which Seller acquired the Shares is currently unpaid or
outstanding. “Knowledge of Seller” shall mean those facts known by any of the officers or
directors of Seller, the Subsidiaries or any affiliate of Seller.

          (n) Compliance with Applicable Laws. None of the Subsidiaries is in violation of any
Applicable Law, except for possible violations that would not, individually or in the aggregate,
have or be reasonably likely to have a Material Adverse Effect on the Subsidiaries. Each of the
Subsidiaries holds all licenses, permits and
registrations required to conduct its business, and all such licenses, permits and
registrations are valid and in full force and effect, except for those the absence of which are not
reasonably likely to have a Material Adverse Effect on the Subsidiaries. Each of the Subsidiaries
is in compliance with all such licenses, permits and registrations, except for possible failures to
be so in compliance which are not reasonably likely to have a Material Adverse Effect on the
Subsidiaries.

          (o) Consents and Approvals. Except as set forth on Schedule 2.1(o), except as
required under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and the rules
and regulations promulgated thereunder (the “Hart-Scott-Rodino Act”), and except for the approval
of the Georgia Insurance Department, the Texas

5

 

Insurance Department and the Missouri Insurance
Department, the execution, delivery and performance of this Agreement by Seller and the
consummation of the transactions contemplated hereby do not require any consent, approval or
authorization of, or registration or filing with, any person or Governmental Entity (as hereinafter
defined).

          (p) Legal Investments. The Subsidiaries have good and valid title to all bonds,
stocks and other investments owned beneficially or of record, free and clear of any liens or other
encumbrances. All such bonds, stocks and other investments are permissible investments for the
Subsidiaries under the Georgia Insurance Code and the Texas Insurance Code, as applicable.

          (q) Insurance Issued. All insurance policies and contracts issued by the Subsidiaries
now in force (other than policies and contracts issued under applicable surplus lines laws) are on
forms and at rates approved by the insurance regulatory authority of the state or jurisdiction
where issued or have been filed with and not objected to by such authority within the period
provided for objection.

          (r) Material Contracts. Except as set forth in Schedule 2.1(r), Seller has made
available to Purchaser complete and correct copies of (i) all reinsurance agreements currently in
effect that have been entered into within the past fifteen (15) years and will provide prior to the
Closing evidence of all reinsurance coverage currently in effect pursuant to reinsurance agreements
that were entered into prior to such period; (ii) all loan or credit agreements, mortgages,
indentures, or other agreements for borrowed money currently in effect; (iii) all employment or
compensation agreements currently in effect with officers, directors, employees, agents (other than
insurance agents), consultants and independent contractors; and (iv) each other contract, lease,
agreement or legal commitment of any kind currently in effect, oral or written, formal or informal,
pursuant to which any of the Subsidiaries owes or could owe more than $75,000 per calendar year or
which limits the ability of any of the Subsidiaries to engage in any line of business or to provide
services to any person (the agreements described in (i)-(iv) are collectively the “Material
Contracts”). All Material Contracts currently in effect are in full force and effect, and none of
the Subsidiaries is in default under, nor has any event occurred which with the passage of time or
giving of notice or both would result in any of the Subsidiaries being in default under, any of the
terms thereof.

          (s) Employee Benefit Plans. The Subsidiaries sponsor no “employee benefit plans” (as
defined in Section 3(3) of the Employee Retirement Security Act of 1974, as amended (“ERISA”),
including the rules and regulations thereunder and hereinafter the “Employee Benefit Plans”). The
employees of the Subsidiaries participate in the Employee Benefit Plans of Seller that are set
forth on Schedule 2.1(s). Except as set forth on Schedule 2.1(s) and except as required by
Applicable Law, neither Seller nor the Subsidiaries nor their affiliates has any contract, plan or
commitment, whether legally binding or not, to create any additional benefit plan or to modify any
existing benefit plan. To the Knowledge of Seller, all benefit plans applicable to employees of
the Subsidiaries comply with all applicable provisions of ERISA and regulations promulgated
thereto.

          (t) Transactions with Related Parties. Except as set forth on Schedule 2.1(t), none
of the Seller, any affiliate of the Seller or any officer or director of the Subsidiaries:

	 	(i)	 	has borrowed money or loaned money to any of
the Subsidiaries which will not be repaid on or before Closing;
	 
	 	(ii)	 	has any contractual or other claim against any
of the Subsidiaries; or
	 
	 	(iii)	 	has any interest in any property or assets
used by the Subsidiaries in their respective businesses.

          (u) Labor Relations. (a) No employee of any of the Subsidiaries is represented by any
union or other labor organization; (b) there is no unfair labor practice complaint against any of
the Subsidiaries actually pending or, to the Knowledge of Seller, overtly threatened before the
National Labor Relations Board; and (c) there is no labor strike, dispute, slow down or stoppage
actually pending or, to the Knowledge of Seller, threatened against or involving any of the
Subsidiaries.

6

 

          (v) Insurance. All of the Subsidiaries’ properties and assets of an insurable nature
and of a character usually insured by companies of similar size and in similar businesses are
insured by the Subsidiaries in such amounts and against such losses, casualties or risks as is (a)
usual in such companies and for such properties, assets and businesses, or (b) required by any
Applicable Law.

          (w) Books and Records. The books and records of the Subsidiaries accurately reflect
in all material respects the business or condition of the Subsidiaries and have been maintained in
all material respects in accordance with good business and bookkeeping practices.

          (x) No Undisclosed Liabilities. Except to the extent reflected in (i) the Annual
Statement for the year ended December 31, 2006 if the Closing occurs prior to March 1, 2008 or the
Annual Statement for the year ended December 31, 2007 if the Closing occurs after March 1, 2008,
(ii) the Quarterly Statement for the quarter ended September 30, 2007, (iii) the Audited Statutory
Statement for the year ended December 31, 2006, (iv) the 2007 Unaudited Statements or (v) Section
3.11 of this Agreement, there are no undisclosed liabilities as of the date of said statements that
individually or in the aggregate have or may reasonably be expected to have a Material Adverse
Effect on any of the Subsidiaries.

     Except as set forth in this Section 2.1, Seller makes no express or implied representations or
warranties with respect to the business, operations, condition (financial or otherwise), assets,
liabilities or prospects of the Subsidiaries or any of its direct or indirect subsidiaries or any
of the transactions contemplated hereby.

     2.2 Representations and Warranties of Purchaser. Purchaser hereby represents and
warrants to Seller as follows:

          (a) Organization and Good Standing. Purchaser is duly organized, validly existing and
in good standing under the laws of its state of organization.

          (b) Authorization. This Agreement has been duly authorized and delivered by or on
behalf of Purchaser and Purchaser is duly authorized to enter into this Agreement, to perform its
respective obligations hereunder, and to consummate the transactions contemplated hereby.

          (c) Enforceability. This Agreement is a legal, valid and binding obligation of
Purchaser, enforceable against Purchaser in accordance with its terms except as may be limited by
bankruptcy, insolvency or other similar laws affecting the enforcement of creditors’ rights
generally or general principles of equity.

          (d) Non-Contravention. Neither the execution and delivery of this Agreement nor the
consummation by Purchaser of the transactions contemplated hereby will constitute a material
violation of or a material default under, or materially conflict with, (i) the Articles of
Incorporation or Bylaws or other organizational or governing documents of Purchaser, (ii) to the
Knowledge of Purchaser, any law, judgment, decree, order, regulation or rule of any court or
governmental agency or authority applicable to Purchaser or any of its respective properties or
assets, or (iii) any indenture, mortgage, loan or credit agreement, or any material contract,
commitment, agreement, understanding, arrangement or restriction of any kind by which Purchaser is
bound. With respect to Purchaser, “Knowledge” shall mean those facts known by any of the officers
or directors of Purchaser.

          (e) Brokerage. No broker, finder or other similar independent agent has acted for
Purchaser in connection with this Agreement and the transactions contemplated hereby.

          (f) Investment Intent. Purchaser is purchasing the Shares for its own account, and
with no intention of distributing or reselling said securities or any part thereof in any
transaction that would be in violation of the securities laws of the United States of America or
any state thereof, without prejudice, however, to Purchaser’s right at all times to sell or
otherwise dispose of all or any part of said securities pursuant to an effective registration
statement under the Securities Act, and applicable state securities laws, or under an exemption
from such registration available under the Securities Act and other applicable state securities
laws and subject, nevertheless, to the disposition of Purchaser’s property being at all times
within Purchaser’s control.

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          (g) Pending Litigation or Proceedings. There are no claims, suits, actions,
proceedings, arbitrations or investigations pending or, to the Knowledge of Purchaser, threatened,
against or otherwise relating to or involving Purchaser or any of its properties, the outcome of
which would reasonably be expected to affect the ability of Purchaser to consummate the
transactions contemplated by this Agreement or to have a Material Adverse Effect on Purchaser.

          (h) Consents and Approvals. Except as required under the Hart-Scott-Rodino Act, and
except for the approval of the Georgia Insurance Department, the Texas Insurance Department and the
Missouri Insurance Department, the execution, delivery and performance of this Agreement by
Purchaser and the consummation of the transactions contemplated hereby do not require any consent,
approval or authorization of, or registration or filing with, any person or Governmental Entity.

     Except as set forth in this Section 2.2, Purchaser makes no express or implied representations
or warranties with respect to the business, operations, condition (financial or otherwise), assets,
liabilities or prospects of Purchaser or any of its direct or indirect subsidiaries or any of the
transactions contemplated hereby.

ARTICLE III

OTHER AGREEMENTS

     3.1 Conduct of Business Pending Closing. Seller covenants and agrees that, prior to
the Closing Date, unless Purchaser shall otherwise agree in writing or as otherwise expressly
permitted or contemplated by this Agreement or required by law, it will cause the business of the
Subsidiaries to be conducted only in the ordinary course consistent with past practice.

          (a) Without limiting the generality of the foregoing, Seller covenants and agrees that, prior
to the Closing Date, unless Purchaser shall otherwise agree in writing or as otherwise expressly
permitted or contemplated by this Agreement or required by law, Seller shall not, and shall not
permit the Subsidiaries to:

          (i) amend the articles of incorporation or bylaws of the Subsidiaries;

          (ii) issue or sell any shares of, or rights of any kind to acquire any shares of or to
receive any payment based on the value of, the Subsidiaries’ capital stock or any securities
convertible into shares of any such capital stock, or redeem or make any payment or other
distribution upon or with respect to any shares of capital stock of the Subsidiaries;

          (iii) incur any indebtedness of the Subsidiaries for borrowed money;

          (iv) agree to any merger or consolidation of or involving the Subsidiaries or sale of
all or substantially all of the assets of the Subsidiaries or any similar reorganization,
arrangement or business combination of or involving the Subsidiaries;

          (v) enter into any contract or other agreement which could materially and adversely
affect Seller’s ability to perform its obligations under this Agreement, or amend or modify
any existing contract or other agreement in a manner which could have any such effect;

          (vi) enter into any contract or other agreement relating to the direct or indirect
guarantee by the Subsidiaries (other than the endorsement of negotiable instruments for
collection in the ordinary course of business) of or in respect of indebtedness for borrowed
money or other financial obligations of any other person or entity;

          (vii) declare or pay any dividend (other than routine monthly dividends paid by Georgia
Casualty to Seller in amounts not to exceed $100,000 per month);

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          (viii) increase the compensation or benefits of officers or employees of the
Subsidiaries or pay any bonuses except for normal and customary increases made or bonuses
paid or accrued in accordance with past practices;

          (ix) except in the ordinary course of business, create or incur any lien, encumbrance,
mortgage, pledge, charge or security interest whatsoever on any of the Subsidiaries’
properties; or, except for the issuance of insurance contracts or policies and the
settlement of insurance claims in the ordinary course of business, incur or assume any
guaranty or other liability to discharge an obligation of another;

          (x) enter into or terminate any Material Contracts (other than the 2008 reinsurance
agreements), except with the written permission of Purchaser which shall not be unreasonably
withheld and which shall be deemed given if Purchaser shall not have denied permission
within three (3) business days of any such request, and except as provided in Section 4.2(i)
of this Agreement;

          (xi) except for outstanding commitments made prior to the date of this Agreement as set
forth on Schedule 3.1(xi), make any expenditure for fixed assets in excess of $25,000 for
any single item or $100,000 in the aggregate;

          (xii) do or fail to do anything that will cause a breach of, or default under, any
Material Contract;

          (xiii) make any change of a material nature in the Subsidiaries’ accounting or
reserving procedures, methods, policies or practices or the manner in which the Subsidiaries
maintain their records; or

          (xiv) invest any of the funds of the Subsidiaries in any investment other than
securities designated as Category 1 Securities, or approved money market funds in the
Purposes and Procedures Manual of the National Association of Insurance Commissioners
Securities Valuation Office.

          (b) Seller further covenants and agrees that, prior to the closing date, Seller will:

          (i) use commercially reasonable efforts to preserve intact the Subsidiaries’ present
business organization, reputation, and policyholder relations;

          (ii) use commercially reasonable efforts to keep available the services of the
Subsidiaries’ current officers, employees, agents, consultants, and other similar
representatives;

          (iii) use commercially reasonable efforts to maintain all licenses, qualifications, and
authorizations of the Subsidiaries to do business in each jurisdiction in which it is so
licensed, qualified, or authorized;

          (iv) use commercially reasonable efforts to continue all current marketing and selling
activities relating to the business, operations, or affairs of the Subsidiaries;

          (v) exercise commercially reasonable efforts to maintain and protect the confidential
and proprietary nature of all of each of the Subsidiaries’ policyholder lists, lists of the
Subsidiaries’ agents and producers, billing records and commission statements, marketing
plans, lists of prospective customers or agents, and other materials relating to the
Subsidiaries’ sales and marketing practices or in force business, all of which, upon the
request of the Purchaser, shall be marked or designated by the Subsidiaries as “confidential
and proprietary information;”

          (c) Seller will cause the books and records of the Subsidiaries to be maintained in the usual
manner and consistent with past practice and will not permit a material change in any underwriting,
investment, actuarial, financial reporting, or accounting practice or policy of the Subsidiaries or
in any assumption underlying such practice or policy, or in any method of calculating any bad debt,
contingency, or other reserve for financial reporting purposes or for other accounting purposes
(including, without limitation, any practice, policy, assumption, or method relating to or

9

 

affecting the determination of the Subsidiaries’ investment income, reserves or other similar
amounts, or operating ratios with respect to expenses, losses, or premiums).

          (d) Seller will cause the Subsidiaries to:

          (i) cause all reserves and other similar amounts with respect to insurance contracts
established or reflected in the books and records of the Subsidiaries to be (1) computed and
reflected on a basis consistent with those reserves and other similar amounts and reserving
methods followed by the Subsidiaries as of December 31, 2006 and (2) good, sufficient and
adequate (under commonly accepted actuarial standards consistently applied and fairly stated
in accordance with sound actuarial principles) to cover the total amount of all reasonably
anticipated matured and unmatured benefits, dividends, losses, claims, expenses, and other
liabilities of the Subsidiaries under all insurance contracts pursuant to which the
Subsidiaries have or will have any liability (including, without limitation, any liability
arising under or as a result of any reinsurance, coinsurance, or other similar contract);
and

          (ii) continue to own admitted assets that qualify as legal reserve assets under all
applicable insurance laws in an amount at least equal to the required reserves of each of
the Subsidiaries and other similar amounts.

          (e) The Subsidiaries will continue to comply, in all material respects, with all Applicable
Laws.

     3.2 Regulatory Filings and Approvals.

          (a) Each of Purchaser and Seller shall make and diligently pursue, and shall cooperate fully
with each other in making and pursuing, all filings and requests for licenses, requests and
approvals of any federal, state or local department, agency, commission, board, bureau or
administrative or regulatory authority or instrumentality (each a “Governmental Entity”) as shall
be reasonably necessary or advisable in order to consummate the transactions contemplated by this
Agreement as promptly as practicable, and shall use all reasonable efforts to obtain all such
licenses, consents and approvals as promptly as practicable and to thereafter maintain all such
licenses, consents and approvals in full force and effect until the transactions contemplated by
this Agreement have been consummated. Any filing fees for filings or requests which may be
required for the consummation of the transactions contemplated by this Agreement shall be paid by
the party required to make said filing or request.

          (b) Purchaser shall use commercially reasonable efforts to file a “Form A Statement Regarding
the Acquisition of Control of or Merger with a Domestic Insurer” (a “Form A Statement”) with the
Georgia Insurance Department and the Texas Insurance Department with respect to the transactions
contemplated hereby within three (3) calendar weeks after the date this Agreement is fully
executed.

          (c) Purchaser and Seller acknowledge and agree that American Southern Insurance Company, a
wholly-owned subsidiary of Seller (“American Southern”), shall be released at the Closing from all
of its obligations under that certain Unconditional Guaranty Agreement by and between Association
Casualty and American Southern dated January 8, 2007 (the “Guaranty Agreement”), which was entered
into as a requirement for Association Casualty to obtain a license to do business in North Carolina. At or prior to the Closing, Purchaser
shall, or shall cause its affiliates to, take whatever action is necessary to maintain Association
Casualty’s license to do business in North Carolina and, in the event that Purchaser fails to
maintain such license, Seller shall not be responsible for any liabilities or any breaches or
inaccuracies of its representations, warranties or other agreements contained in this Agreement or
the disclosure schedules hereto that are a direct result of Purchaser’s failure to maintain such
license.

     3.3 Access. From the date hereof through the Closing Date, upon reasonable notice,
Seller shall (i) afford the officers, employees and authorized agents and representatives of
Purchaser reasonable access, during normal business hours, to the books and records of the
Subsidiaries and (ii) furnish to the officers, employees and authorized agents and representatives
of Purchaser such additional information regarding the Subsidiaries as Purchaser may from time to
time request; provided, however, that such investigation shall not unreasonably
interfere with the business or operations of the Subsidiaries or Seller.

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     3.4 Further Actions.

          (a) Subject to the rights of each party pursuant to Section 5.1 hereof, each of the parties
hereto shall use all commercially reasonable efforts to cause the conditions precedent to the
respective obligations of the other party hereto to be fully satisfied so that the Closing may
occur at the earliest practicable date; provided, however, that if the Closing
occurs, the obligations of each of the parties pursuant to this Section 3.4(a) shall be deemed to
have been satisfied.

          (b) Upon and following the Closing Date, each party shall, if reasonably requested by the
other party, execute and deliver such further instruments or agreements and take such other
reasonable actions as may be necessary or desirable (i) to convey or transfer more effectively to
Purchaser the Shares, or (ii) otherwise to effectuate the intent of the covenants and agreements of
the parties herein.

     3.5 Notice of Proceedings. Each of Seller and Purchaser shall promptly notify the
other of, and provide to the other all reasonably requested information relating to, any claim,
action, suit, proceeding or governmental or regulatory investigation commenced or, to its actual
Knowledge, threatened against, relating to or involving or otherwise affecting such party or any of
its subsidiaries, as the case may be, which, if pending on the date hereof, would have made any
representation of such party hereunder false or which otherwise relates to the execution of this
Agreement or the consummation of any of the transactions contemplated hereby.

     3.6 Non-Solicitation. Seller will not, and will not cause or permit the Subsidiaries
to, solicit any proposal or offer from any third party relating to the acquisition of all or
substantially all of the capital stock or assets of the Subsidiaries (including any acquisition
structured as a merger, consolidation or share exchange); provided, however that, after giving
notice thereof to Purchaser, Seller and the Subsidiaries and each of their officers and directors
shall be entitled to participate in any discussions or negotiations regarding, furnish any
information with respect to, assist or participate in, or facilitate in any other manner any
unsolicited effort or attempt by any third party to do or seek to do any of the foregoing, in each
case as and to the extent that their fiduciary duties may require (as determined in good faith by
any such person taking such action). Purchaser further acknowledges and agrees that (i) any
proposal or offer with respect to the stock or assets of the Subsidiaries which is not solicited in
violation of this Section 3.6 and any discussions or negotiations not prohibited by this Section
3.6 shall not constitute a breach of this Agreement or interference with this Agreement or the
within described contractual arrangement by Seller, any of its officers, directors or employees or
any such third party, and (ii) Purchaser shall not take or cooperate with any other person or party
in taking any action to enjoin or otherwise interfere with any such discussions or negotiations or
to assert any liability on the part of Seller, any of its officers, directors or employees or any
such third party resulting therefrom.

     3.7 Certain Tax Matters.

          (a) Seller shall prepare or cause to be prepared and Seller shall file or cause to be filed
all Tax Returns for the Subsidiaries for all periods ending on or prior to the Closing Date, and
shall pay such Tax as shown as due on such Tax Returns. Purchaser shall prepare or cause to be
prepared all Tax Returns with respect to any taxable period that includes, but does not end on the
Closing Date (a “Straddle Period”). Purchaser shall permit Seller to
review and comment on each Tax Return described in the preceding sentence and shall consider
Seller’s comments in good faith. Purchaser shall file or cause to be filed the Tax Returns in a
timely manner. With respect to Taxes relating to the Straddle Period, Seller shall be responsible
for the portion of such Taxes relating to the portion of the Straddle Period ending on the Closing
Date (in the case of income taxes, determined on a closing of the books basis, and in the case of
other taxes, on a per diem basis), and the Purchaser shall be responsible for Taxes relating to the
portion of the Straddle Period starting on the Closing Date.

          (b) Purchaser and its affiliates (including the Subsidiaries) shall, upon receipt of notice of
any claim, proceeding or audits regarding Taxes relating to a Tax period ending on or prior to the
Closing Date or any Straddle Period, shall immediately give a copy of such notice to Seller.
Seller shall be entitled to control any claim, proceeding or audit for tax periods ending prior to
the Closing Date, and Seller shall be responsible for any additional tax liability that may be
assessed. Purchaser shall be entitled to control any claim, proceeding or audit for any Straddle
Period; provided, that Seller shall be entitled, at its expense, to participate in any such
claim, proceeding or audit; and provided, further, that, to the extent Seller would
be responsible for any potential portion of a tax liability pursuant to the last

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sentence of
Section 3.7(a) resulting from any such claim, proceeding or audit, Purchaser shall not settle any
such claim, proceeding or audit without the prior written consent of Seller, which consent shall
not be unreasonably withheld or delayed. Purchaser shall not file any amended Tax Return with
respect to the Subsidiaries relating to Tax Periods ending on or prior to the Closing Date without
the prior written consent of Seller, which shall not be unreasonably withheld or delayed.

          (c) Purchaser, Seller and their affiliates shall cooperate fully, as and to the extent
reasonably requested by the other party, in connection with the filing of Tax Returns pursuant to
this Section 3.7 and any audit, litigation or other proceeding with respect to such Taxes.

     3.8 Employee Matters. Purchaser shall, and shall cause any of its subsidiaries or
affiliates to, recognize the service of each employee of the Subsidiaries, immediately prior to the
Closing Date, who remain in the active employment of the respective Subsidiaries after the Closing
Date (the “Continuing Employees”), as if such service had been performed with Purchaser or its
subsidiaries or affiliates with respect to any plans or programs in which Continuing Employees are
eligible to participate after the Closing Date (i) for purposes of eligibility to participate,
eligibility for early retirement and vesting (but not for benefit accrual unless required by
applicable law) under any retirement plan, (ii) for purposes of eligibility for, and amount of,
vacation, (iii) for purposes of eligibility and participation under any health or welfare plan with
the exception of the long term disability plan, and (iv) for benefit determination purposes under
any severance plan.

     3.9 Delivery of 2007 Audited Statements. Seller shall deliver to Purchaser the
audited statutory balance sheets of Georgia Casualty and Association Casualty on an unconsolidated
basis as of and for the year ended December 31, 2007, and the audited statutory statements of
operations, changes in capital and surplus, and cash flows of Georgia Casualty and Association
Casualty on an unconsolidated basis as of and for the year ended December 31, 2007 (such financial
statements, including all notes and schedules thereto and the independent auditors’ report of BDO
Seidman, LLP thereon, being the “2007 Audited Statements”), promptly upon the completion of the
2007 Audited Statements.

     3.10 Retained Litigation.

          (a) Purchaser and Seller acknowledge and agree that Seller shall retain all rights to pursue
in the name of Georgia Casualty and Association Casualty that certain litigation pending in Case
No. 1:06-cv-00954-KS-RHW in the United States District Court for the Southern District of
Mississippi, Southern Division (the “Retained Litigation”), including the sole and exclusive right
to control the prosecution of the Retained Litigation (including the settlement thereof).

          (b) Purchaser and Seller acknowledge and agree that Seller shall be entitled to any and all
rewards or proceeds resulting from the Retained Litigation (including from the settlement thereof).
Purchaser and Seller acknowledge and agree that Seller shall bear the responsibility for, and
shall indemnify Purchaser against, all costs and expenses incurred in connection with Seller’s
pursuit of the Retained Litigation, including any liabilities that may arise therefrom.

          (c) To the extent requested by Seller, Purchaser agrees to cooperate, and shall cause the
Subsidiaries to cooperate, with Seller in its pursuit of the Retained Litigation, including by
making available such of its or the Subsidiaries’ employees and officers and books and records that
the Seller determines are necessary to pursue the Retained Litigation.

     3.11 Fees for Seller Services. From the date hereof through the Closing Date, Seller
shall continue to provide to the Subsidiaries the intercompany services that Seller and its
affiliates have historically provided to the Subsidiaries consistent with past practice and the
Subsidiaries shall reimburse Seller and its affiliates for the costs of such services;
provided, however, that the Subsidiaries shall not reimburse Seller and its
affiliates for amounts for such services in excess of Three Hundred Seventy-Five Thousand Dollars
($375,000) in the aggregate for each calendar month during the period from January 1, 2008 through
the Closing Date and said amount includes the dividends, if any, paid by Georgia Casualty to Seller
referred to in Section 3.1(a)(vii) hereto. In the event that the Closing occurs on a date other
than the last day of a month, said amount shall be prorated for said month. Seller and Purchaser
acknowledge and agree that such monthly reimbursements shall be paid by the Subsidiaries to Seller
or its affiliates within one month after such services

12

 

are performed, including with respect to the
month in which the Closing occurs in which case such fees for the period from the beginning of such
month through the Closing Date shall be paid within one month after the Closing Date.

ARTICLE IV

CONDITIONS TO CLOSING

     4.1 Conditions to Obligations of Seller. The obligations of Seller to effect the
transactions contemplated by this Agreement shall be subject to the fulfillment of the following
conditions:

          (a) the representations and warranties made by Purchaser in this Agreement that are qualified
as to materiality or Material Adverse Effect shall be true and correct, and the representations and
warranties made by Purchaser in this Agreement that are not so qualified shall be true and correct
in all material respects, as of the date of this Agreement; and all such representations and
warranties, certifications and statements of Purchaser that are qualified as to materiality or
Material Adverse Effect shall be true and correct, and all such representations and warranties,
certifications and statements of Purchaser that are not so qualified shall be true and correct in
all material respects, as of the Closing Date with the same effect as though such representations
and warranties had been made on and as of the Closing Date (except that representations and
warranties made with respect to a specified date need only be true and correct as of such date),
and Seller shall have received a certificate to such effect signed by an authorized officer of
Purchaser;

          (b) Purchaser shall have performed and complied with all agreements and conditions required by
this Agreement to be performed or complied with by it at or prior to the Closing, and Seller shall
have received a certificate to such effect signed by an authorized officer of Purchaser;

          (c) the transactions contemplated hereby shall have been approved or not disapproved at the
conclusion of all applicable waiting periods, as the case may be, by the Georgia Insurance
Commissioner, the Texas Insurance Commissioner and the Missouri Insurance Commissioner and each
such approval shall remain in effect, and such other licenses, consents and approvals of any
Governmental Entity as are required by law in order to permit each of the parties hereto to
consummate the transactions contemplated by this Agreement shall have in each case been obtained
and not rescinded (other than with respect to the matters set forth in Section 3.2(c)), and any and
all applicable waiting periods imposed by law shall have expired;

          (d) no order entered or law promulgated or enacted by any court, legislature or other
Governmental Entity shall be in effect which would prevent the consummation of the transactions
contemplated hereby, and no claim, action, suit or proceeding shall have been commenced and be
pending which seeks to restrain, prevent, materially delay or restructure the transactions
contemplated hereby or which otherwise questions the validity or legality of such transactions;

          (e) the waiting period under the Hart-Scott-Rodino Act (and any extension thereof) shall have
expired or terminated, if applicable;

          (f) Purchaser shall have obtained approval of a Form A Statement with the Georgia Insurance
Department and the Texas Insurance Department with respect to the transactions contemplated hereby,
and shall have obtained written or verbal approval of the Missouri Insurance Department to acquire
the Subsidiaries; and

          (g) at or prior to the Closing, Purchaser shall have, or shall have caused its affiliates to,
use commercially reasonable efforts to maintain Association Casualty’s license to do business in
North Carolina and American Southern shall be released from all of its obligations under the
Guaranty Agreement.

     4.2 Conditions to Obligations of Purchaser. The obligations of Purchaser to effect
the transactions contemplated by this Agreement shall be subject to the fulfillment of the
following conditions:

          (a) the representations and warranties made by Seller in this Agreement and any disclosure
schedule that are qualified as to materiality or Material Adverse Effect shall be true and correct,
and the representations and

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warranties made by Seller in this Agreement that are not so qualified
shall be true and correct in all material respects, as of the date of this Agreement; and all such
representations and warranties, certifications and statements of Seller that are qualified as to
materiality or Material Adverse Effect shall be true and correct, and all such representations and
warranties, certifications and statements of Seller that are not so qualified shall be true and
correct in all material respects, as of the Closing Date with the same effect as though such
representations and warranties had been made on and as of the Closing Date (except for any such
representations or warranties that are no longer true and correct as a direct result of Purchaser’s
failure to maintain Association Casualty’s license to do business in North Carolina in accordance
with Section 3.2(c), and except that representations and warranties made with respect to a
specified date need only be true and correct as of such date), and Purchaser shall have received a
certificate to such effect signed by an authorized officer of Seller;

          (b) Seller shall have performed and complied with all agreements and conditions required by
this Agreement to be performed or complied with by Seller at or prior to the Closing, and Purchaser
shall have received a certificate to such effect signed by an authorized officer of Seller;

          (c) the transactions contemplated hereby shall have been approved or not disapproved at the
conclusion of all applicable waiting periods, as the case may be, by the Georgia Insurance
Commissioner, the Texas Insurance Commissioner and the Missouri Insurance Commissioner and each
such approval shall remain in effect, and such other licenses, consents and approvals of any
Governmental Entity as are required by law in order to permit each of the parties hereto to
consummate the transactions contemplated by this Agreement shall have in each case been obtained
and not rescinded (other than with respect to the matters set forth in Section 3.2(c)), and any and
all applicable waiting periods imposed by law shall have expired;

          (d) no order entered or law promulgated or enacted by any court, legislature or other
Governmental Entity shall be in effect which would prevent the consummation of the transactions
contemplated hereby, and no claim, action, suit or proceeding shall have been commenced and be
pending which seeks to restrain, prevent, materially delay or restructure the transactions
contemplated hereby or which otherwise questions the validity or legality of such transactions;

          (e) the waiting period under the Hart-Scott-Rodino Act (and any extension thereof) shall have
expired or terminated, if applicable;

          (f) at or prior to the Closing, Seller shall cause Bank to release the Shares of Georgia
Casualty and Association Casualty from the Pledge Agreement; and

          (g) from and after the date hereof, there shall have been no material adverse change in the
financial condition, operations or prospects of the Subsidiaries.

          (h) prior to the Closing, Seller shall cause the Subsidiaries to dispose of the securities
listed on Schedule 4.2(h); provided, in the event that such securities are sold after
December 31, 2007, the Purchase Price shall be (i) increased by the amount, if any, that the sales
price received for such securities exceeds the book adjusted carrying value for such securities
shown on the Annual Statements of the Subsidiaries for the year ended December 31, 2007 (the “Book
Value”), net of tax, or (ii) decreased by the amount, if any, that the Book Value exceeds the sales
price for such securities, net of tax;

          (i) simultaneous with the Closing, Seller shall, and shall cause the Subsidiaries to,
terminate all management agreements, cost allocation agreements and leases, whether written or
otherwise, between any of the Subsidiaries and Seller or any of its affiliates, and the
Subsidiaries other than the contracts referred to in Section 4.2(k) hereof;

          (j) Purchaser and Seller shall have entered into a mutually agreeable Non-Competition
Agreement in the form attached hereto as Exhibit A; and

14

 

          (k) Seller shall have entered into contracts with the Subsidiaries and/or Purchaser on terms
mutually agreeable to Purchaser and Seller pursuant to which Seller or its affiliates shall provide
to the Subsidiaries and/or Purchaser certain services to be mutually agreed upon by Purchaser and
Seller.

ARTICLE V

TERMINATION, AMENDMENT AND WAIVER

     5.1 Termination. This Agreement may be terminated at any time prior to the Closing:

          (a) by mutual written consent of Purchaser and Seller;

          (b) by either party hereto if a material breach of or failure to perform any representation,
warranty, covenant or agreement on the part of the other party set forth in this Agreement (other
than such material breaches on the part of Seller that are a direct result of Purchaser’s failure
to maintain Association Casualty’s license to do business in North Carolina in accordance with
Section 3.2(c)) shall have occurred and such breach has not been waived by the non-breaching party
or cured to the reasonable satisfaction of the non-breaching party within 30 days of the
non-breaching party’s written notice to the breaching party thereof;

          (c) by either party hereto, upon written notice to the other party hereto, if the party giving
such notice determines, in such party’s sole good faith judgment, that any condition to the
consummation by such party of the transactions contemplated by this Agreement set forth in Section
4.1 with respect to Seller and Section 4.2 with respect to Purchaser has become impossible to be
fulfilled;

          (d) by either party hereto, if the Closing shall not have occurred by the End Date;
provided, however, that no party may terminate this Agreement pursuant to this
Section 5.1(d) if such party’s breach of its obligations under this Agreement proximately caused
the failure of the Closing to occur by such date;

          (e) by either party hereto, upon payment to the other party hereto of the Break-Up Fee in
accordance with Section 5.2(a); or

          (f) by either party hereto, if any regulatory approvals described in Section 4.2(c) have been
denied or refused, notwithstanding the best efforts of the party having responsibility for
obtaining such regulatory approvals.

     5.2 Effect of Termination; Termination Fee.

          (a) In the event of any termination of this Agreement as provided in Section 5.1, this
Agreement shall have no further force and effect, and there shall be no liability on the part of
either party hereto or its officers or directors hereunder, except (i) that the provisions of this
Section 5.2 and Sections 6.3, 6.4, 6.5, 6.6, 6.8, 6.10, 6.11, 6.12
and 6.14 shall survive any such termination; (ii) that this section 5.2 shall not relieve
either party from liability for any willful breach of any representation or warranty set forth
herein or any breach prior to such termination of any covenant or agreement contained herein, (iii)
as provided in Section 5.2(b) and (iv) as provided in Section 5.2(c).

          (b) In order for either party hereto to terminate this Agreement pursuant to Section 5.1(e),
such party shall pay to the other party hereto a break-up fee in the amount of Two Million Dollars
($2,000,000) (the “Break-Up Fee”) by means of a wire transfer of immediately available funds to
such bank account designated by the other party and such termination shall be effective upon
receipt by the non-terminating party of the Break-Up Fee.

          (c) If the Closing shall not have occurred by the End Date, Purchaser shall pay to Seller the
Break-Up Fee by means of a wire transfer of immediately available funds to such bank account
designated by Seller within two (2) business days following such date; provided,
however, that Purchaser shall not be required to pay to Seller the Break-Up Fee pursuant to
this Section 5.2(c) if (i) any of Seller’s representations or warranties that are qualified as to
materiality or Material Adverse Effect are untrue, or any of Seller’s representations or warranties
that are not so qualified are untrue in any material respect, as of the date made or as of the End
Date (except for any representations or warranties that are untrue as a direct result of
Purchaser’s failure to maintain Association Casualty’s license to do business in North

15

 

Carolina in
accordance with Section 3.2(c)); (ii) Seller has violated any of the covenants or agreements
contained in Article III of this Agreement in any material respect; or (iii) any of the conditions
to Closing contained in Sections 4.2(a) through (i) hereof have not occurred or Seller has failed
to execute the Non-Competition Agreement referred to in Section 4.2(j) or the agreements referred
to in Section 4.2(k).

     5.3 Amendment. This Agreement may be amended by mutual consent of the parties hereto
at any time prior to the Closing Date; provided, however, that any amendment must
be by an instrument or instruments in writing signed and delivered on behalf of each of the parties
hereto.

     5.4 Extension; Waiver. At any time prior to the Closing Date, any party hereto which
is entitled to the benefits hereof may (i) extend the time for performance of any of the
obligations or other acts of the other party hereto; (ii) in whole or in part, waive any inaccuracy
in the representations and warranties of the other party hereto contained herein or in any document
delivered pursuant hereto, and (iii) in whole or in part, waive compliance with any of the
agreements of the other party hereto or conditions to the obligations of such party contained
herein. Any such agreement on the part of either party hereto to any extension or waiver shall be
valid only if set forth in an instrument in writing signed and delivered on behalf of the party
granting such extension or waiver.

ARTICLE VI

GENERAL PROVISIONS

     6.1 Survival of Representations, Warranties and Agreements. The representations,
warranties and agreements contained in this Agreement, any exhibits and schedules hereto, and in
any certificates delivered pursuant to this Agreement shall survive for a period of twenty-four
(24) months following the Closing Date, and neither party shall have any right or claim against the
other party after such period by virtue of any breach or violation of any such representation,
warranty or agreement; provided, however, that (i) nothing contained herein shall
limit any covenant or agreement of the Parties that by its terms contemplates performance after the
Closing Date; (ii) Section 3.10 shall survive indefinitely and (iii) in all cases, any
representation, warranty, covenant or agreement that is the subject of a claim which is asserted by
the party seeking indemnification pursuant to Section 6.2 in a reasonably detailed writing
delivered to the other party or parties, as the case may be, prior to the expiration of the
applicable survival period shall survive with respect to such claim or dispute until the final
resolution thereof.

     6.2 Indemnification.

          (a) Indemnification by Seller. Subject to the conditions and provisions of
Sections 3.2(c) and 6.2(c), (d) and (f), from and after the Closing Date, Seller agrees to
indemnify, defend and hold Purchaser, the Subsidiaries and their officers, directors, employees,
agents and shareholders (the “Purchaser Indemnified Parties”) harmless from and against and in any
respect of any loss, liability,
claim, obligation, damage or deficiency (a “Loss”) arising out of or resulting from (i) any
misrepresentation or breach of the representations, warranties or certifications of Seller
contained in or made pursuant to this Agreement, or (ii) any breach by Seller of any covenants of
Seller contained in or made pursuant to this Agreement.

          (b) Indemnification by Purchaser. Subject to the conditions and provisions of
Sections 6.2(c), (d) and (f), from and after the Closing Date, Purchaser agrees to indemnify,
defend and hold Seller and Seller’s officers, directors, employees, agents and shareholders (the
“Seller Indemnified Parties”) harmless from and against and in any respect of any Loss arising out
of or resulting from (i) any misrepresentation or breach of the representations, warranties or
certifications of Purchaser contained in or made pursuant to this Agreement, or (ii) any breach by
Purchaser of any covenants of Purchaser contained in or made pursuant to this Agreement.

          (c) Limitations on Indemnification.

          (i) Seller shall not be liable to the Purchaser Indemnified Parties in respect of any
indemnification under Section 6.2(a) except to the extent that the aggregate Losses of the
Purchaser Indemnified Parties under Section 6.2(a) exceed $250,000 (the “Basket Amount”), in
which event the Purchaser Indemnified Parties may claim indemnification for all Losses of
the Purchaser Indemnified Parties.

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          (ii) Purchaser acknowledges and agrees that the maximum aggregate liability of Seller
pursuant to Section 6.2(a) to the Purchaser Indemnified Parties and any third parties for
any and all Losses shall not exceed $7,500,000; provided, however, that
nothing in this Section 6.2(c)(ii) shall be construed to constitute a waiver or limitation
of any claims by Purchaser based on fraud, willful misconduct or bad faith of Seller.

          (iii) The Purchaser Indemnified Parties’ right to indemnification pursuant to Section
6.2(a) on account of any Losses will be reduced by all insurance or other third party
indemnification proceeds actually received by the Purchaser Indemnified Parties. The
Purchaser Indemnified Parties shall use their commercially reasonable efforts to claim and
recover any Losses suffered by the Purchaser Indemnified Parties under any such insurance
policies or other third party indemnities. The Purchaser Indemnified Parties shall remit to
Seller any such insurance or other third party proceeds which are paid to the Purchaser
Indemnified Parties with respect to Losses for which the Purchaser Indemnified Parties have
been previously compensated pursuant to Section 6.2(a).

          (iv) Purchaser shall not be liable to the Seller Indemnified Parties in respect of any
indemnification under Section 6.2(b) except to the extent that the aggregate Losses of the
Seller Indemnified Parties under Section 6.2(a) exceed the Basket Amount, in which event the
Seller Indemnified Parties may claim indemnification for all Losses of the Seller
Indemnified Parties.

          (v) Seller acknowledges and agrees that the maximum aggregate liability of Purchaser
pursuant to Section 6.2(b) to the Seller Indemnified Parties and any third parties for any
and all Losses shall not exceed $7,500,000; provided, however, that nothing
in this Section 6.2(c)(iv) shall be construed to constitute a waiver or limitation of any
claims by Seller based on fraud, willful misconduct or bad faith of Purchaser.

          (vi) The Seller Indemnified Parties’ right to indemnification pursuant to Section
6.2(b) on account of any Losses will be reduced by all insurance or other third party
indemnification proceeds actually received by the Seller Indemnified Parties. The Seller
Indemnified Parties shall use their commercially reasonable efforts to claim and recover any
Losses suffered by the Seller Indemnified Parties under any such insurance policies or other
third party indemnities. The Seller Indemnified Parties shall remit to Purchaser any such
insurance or other third party proceeds which are paid to the Seller Indemnified Parties
with respect to Losses for which the Seller Indemnified Parties have been previously
compensated pursuant to Section 6.2(b).

          (vii) No claim for indemnification may be made pursuant to this Section 6.2 after the
expiration of the applicable survival period set forth in Section 6.1.

          (d) Conditions of Indemnification. The obligations and liabilities of Seller and of
Purchaser hereunder with respect to their respective indemnities pursuant to this Section 6.2,
resulting from any Losses, shall be subject to the following terms and conditions:

          (i) The party seeking indemnification (the “Indemnified Party”) must give the other
party or parties, as the case may be (the “Indemnifying Party”), notice of any such Losses
promptly after the Indemnified Party receives notice thereof; provided that the
failure to give such notice shall not affect the rights of the Indemnified Party hereunder
except to the extent that the Indemnifying Party shall have suffered actual damage by reason
of such failure.

          (ii) The Indemnifying Party shall have the right to undertake, by counsel or other
representatives of its own choosing (reasonably acceptable to the Indemnified Party), the
defense of such Losses at the Indemnifying Party’s risk and expense; provided,
however, that as a condition to the exercise of such right to undertake defense of
such Losses, the Indemnifying Party shall, as between the Indemnifying Party and the
Indemnified Party, assume the liability for such Losses, without regard to the limitations
set forth in Section 6.2(c)(ii) or Section 6.2(c)(v), as applicable.

          (iii) In the event that the Indemnifying Party shall elect not to undertake such
defense, or, within a reasonable time after notice from the Indemnified Party of any such
Losses, shall fail to defend, the Indemnified Party (upon further written notice to the
Indemnifying Party) shall have the right to undertake the

17

 

defense, compromise or settlement
of such Losses, by counsel or other representatives of its own choosing, on behalf of and
for the account and risk of the Indemnifying Party (subject to the right of the Indemnifying
Party to assume defense of such Losses at any time prior to settlement, compromise or final
determination thereof (with counsel reasonably acceptable to the Indemnified Party)). In
such event, the Indemnifying Party shall pay to the Indemnified Party, in addition to the
other sums required to be paid hereunder, the costs and expenses incurred by the Indemnified
Party in connection with such defense, compromise or settlement as and when such costs and
expenses are so incurred.

          (iv) Notwithstanding anything contained in this Section 6.2(d) to the contrary, (a) if
any third party alleges the right to or seeks any remedy other than money damages or other
money payments, the Indemnified Party shall have the right, at the cost and expense of the
Indemnifying Party, to participate in and direct the defense, compromise or settlement of
the Losses, (b) the Indemnifying Party shall not, without the Indemnified Party’s written
consent, settle or compromise any Losses or consent to entry of any judgment which does not
include as an unconditional term thereof the giving by the claimant or the plaintiff to the
Indemnified Party of a release from all liability in respect of such Losses in form and
substance reasonably satisfactory to the Indemnified Party, (c) in the event that the
Indemnifying Party undertakes defense of any Losses, the Indemnified Party, by counsel or
other representative of its own choosing and at its sole cost and expense, shall have the
right to consult with the Indemnifying Party and its counsel or other representatives
concerning such Losses and the Indemnifying Party and the Indemnified Party and their
respective counsel or other representatives shall cooperate with respect to such Losses,
(d) in the event that the Indemnifying Party undertakes defense of any Losses, the
Indemnifying Party shall have an obligation to keep the Indemnified Party informed of the
status of the defense of such Losses and furnish the Indemnified Party with all documents,
instruments and information that the Indemnified party shall reasonably request in
connection therewith, and (e) in the event that both the Indemnified Party and the
Indemnifying Party are parties (directly or through interpleader) to any Losses giving rise
to indemnification hereunder and the Indemnified Party is advised by counsel that there is
or may be a conflict of interest in the representation of both the Indemnified Party and the
Indemnifying Party by one firm of counsel, the Indemnified Party shall be entitled to
assume, at the sole cost and expense of the Indemnifying Party, the defense, compromise and
settlement (subject to clause (b) of this Section 6.2(d)(iv) above) of such Loss with
counsel (in addition to local counsel) reasonably satisfactory to the Indemnifying Party.

          (v) In the event that an Indemnified Party has a good faith basis for a claim for
indemnification which does not involve a claim against it by a third party (a “Direct
Claim”), the Indemnified Party shall notify the Indemnifying Party in writing of such Direct
Claim with reasonable promptness,
specifying, to the extent known, the nature, circumstances and amount of such Direct
Claim, including with particularity the specific representation and warranty or covenant and
agreement alleged to have been breached; provided, that the failure to give such
notice shall not affect the rights of the Indemnified Party hereunder except to the extent
that the Indemnifying Party shall have suffered actual damage by reason of such failure. If
the Indemnifying Party notifies the Indemnified Party that it disputes an Indemnified
Party’s right of indemnification with respect to a particular Direct Claim, the parties
shall use their reasonable efforts to negotiate a resolution of such dispute promptly.
Except to the extent of the limitations on indemnification set forth in this Section 6.2,
nothing in this Section 6.2(d)(v) shall be deemed to prevent any Indemnified Party from
initiating litigation under this Agreement with respect to any Direct Claim disputed by the
Indemnifying Party for the purpose of establishing the Indemnified Party’s right to
indemnification hereunder.

          (e) Exclusive Remedy. Except with respect to fraud, willful misconduct or bad faith,
from and after the Closing Date, the indemnification rights provided in Section 6.2 of this
Agreement shall be the sole and exclusive remedy available under contract, tort or any other legal
theory to Purchaser, Seller or any other person with respect to any Losses, including any debts,
liabilities, damages, obligations, claims, demands, judgments, and settlements, whether asserted by
third parties or incurred or sustained in the absence of third-party claims, including all costs
and expenses, including interest, penalties, attorneys’ fees and any amounts paid in investigation,
defense or settlement of any of the foregoing incurred or sustained pursuant to or in connection
with this Agreement or the transactions contemplated hereby.

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          (f) Exception to Indemnification. Notwithstanding anything to the contrary contained
herein, if the Closing occurs no claim for indemnification may be asserted under this Agreement or
any document delivered in connection herewith with respect to any matter which the indemnifying
party can prove was discovered or known by the party otherwise entitled to seek indemnification on
or before the Closing Date.

     6.3 Notices. All notices and other communications required to be given hereunder
shall be in writing and shall be deemed to have been duly given upon delivery, if delivered by
hand; if given by mail, three (3) days after the date of mailing, postage prepaid, certified or
registered mail to a party hereto at the address set forth below; if given by facsimile, upon
transmission to the number set forth below provided written confirmation is sent to the address
below; if given by overnight delivery service addressed to the address set forth below, the
business day following the day on which such notice is sent:

If to Seller:

Atlantic American Corporation

4370 Peachtree Road, NE

Atlanta, Georgia 30319

Attention: Mr. Hilton H. Howell, Jr.

Facsimile: (404) 266-8107

Email: hhh@atlam.com

with a copy to:

Troutman Sanders LLP

Bank of America Plaza

600 Peachtree Street, N.E.

Suite 5200

Atlanta, Georgia 30308-2216

Attention: Neal H. Ray, Esq.

Facsimile: (404) 962-6857

Email: neal.ray@troutmansanders.com

If to Purchaser:

Columbia Mutual Insurance Company

2102 White Gate Drive

Columbia, MO 65202

Attention: Mr. Robert J. Wagner

Facsimile: (573) 474-5865

Email: bwagner@colinsgrp.com

with a copy to:

Columbia Mutual Insurance Company

2102 White Gate Drive

Columbia, MO 65202

Attention: Mr. Gary Thompson

Facsimile: (573) 474-5865

Email: gthompson@colinsgrp.com

Either party hereto may change its address for purposes of receiving notice pursuant to this
Agreement by giving notice of such new address to the other party hereto.

19

 

     6.4 Fees and Expenses. Each of the parties shall pay its own expenses incurred in
connection with the preparation, negotiation, execution, delivery and performance of this
Agreement, whether or not the transactions contemplated hereby are consummated.

     6.5 Interpretation. The article and section headings contained in this Agreement are
for reference purposes only and shall not affect the meaning or interpretation of this Agreement.
Terms used in the plural include the singular, and vice versa, unless the context otherwise
requires.

     6.6 Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE
WITH THE LAWS OF THE STATE OF GEORGIA, WITHOUT REGARD FOR ITS CONFLICT OF LAWS DOCTRINE.

     6.7 Counterparts. This Agreement may be executed in one or more identical
counterparts, each of which shall be deemed to be an original, but all of which together shall
constitute one and the same instrument. Telecopy transmissions of signatures shall be deemed to
constitute originals.

     6.8 Entire Agreement. This Agreement (together with the Schedules hereto)
constitutes the entire agreement and supersedes all prior agreements and understandings, both
written and oral, among the parties, or any of them, with respect to the subject matter hereof;
provided that the Confidentiality Agreement dated October 2, 2007, by and between Seller
and Purchaser relating to certain Confidential Information (as defined therein) shall not be
superseded by this Agreement and shall remain in effect hereafter or otherwise with respect to the
subject matter hereof.

     6.9 Assignment. This Agreement shall not be assigned by any party by operation of
law or otherwise without the prior written consent of each other party hereto. Any purported
assignment in violation of this provision shall be null and void.

     6.10 Binding Effect. The terms and provisions of this Agreement shall be binding
upon, inure to the benefit of, and be enforceable by or against the parties and their respective
legal representatives, heirs, successors and permitted assigns.

     6.11 Severability. If any part of this Agreement or other agreement entered into
pursuant hereto is contrary to, prohibited by or deemed invalid under applicable law or regulation,
such provision shall be inapplicable and deemed
omitted to the extent so contrary, prohibited or invalid, but the remainder of this Agreement
shall not be invalidated thereby and shall be given full force and effect to the greatest extent
permitted by law.

     6.12 Publicity. Except as required by law or by the rules of any national securities
exchange or the National Association of Securities Dealers, Inc., each of the parties hereto and
their respective agents, representatives and employees will keep strictly confidential this
Agreement and its contents, and all related discussions and negotiations regarding the subject
matter hereof and, without the express written consent of each of Purchaser and Seller (which
consent shall not be unreasonably withheld), shall not make any disclosure or announcement about
the existence or contents of this Agreement or the transactions contemplated hereunder.
Notwithstanding the foregoing, it is agreed and understood that (i) promptly following the
execution of this Agreement Seller will prepare and disseminate a public announcement of the
principal terms hereof, identifying the parties hereto, and (ii) Purchaser will be given a
reasonable opportunity to review and comment upon such public announcement in advance of its
dissemination.

     6.13 Subsequent SEC Filings. After the Closing, the parties agree to furnish
information to each other (on a SAP and/or GAAP basis) so that each party may prepare any filings
required to be made with the SEC or any other Governmental Entity. The parties shall each be
responsible for their own costs and expenses (including, without limitation, professional fees and
expenses) incurred in preparing such filings.

     6.14 Authorship. The parties agree that the terms and language of this Agreement
were the result of negotiations between the parties, and as a result, there shall be no presumption
that any ambiguities in this Agreement shall be resolved against any party. Any controversy over
construction of this Agreement shall be decided without regard to events of authorship.

20

 

(Signatures appear on the following page)

21

 

     IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed as of the
date first above written.

	 	 	 	 	 	 
	 	ATLANTIC AMERICAN CORPORATION

 	 
	 	By:  	 	/s/ J. Mack Robinson

 	 
	 	Name:  	 	J. Mack Robinson 	 	 
	 	Title:  	 	Chairman 	 	 
	 					
	 	COLUMBIA MUTUAL INSURANCE COMPANY

 	 
	 	By:  	 	/s/ Robert J. Wagner
 	 
	 	Name:  	 	Robert J. Wagner 	 	 
	 	Title:  	 	President 	 	 
	 					

22

 

Exhibit A 

Form of Non-Competition Agreement

23EX-10.10 LEASE AGREEMENT

 

EXHIBIT 10.10

LEASE AGREEMENT

     This LEASE AGREEMENT, dated as of the First day of November, 2007, by and between DELTA LIFE
INSURANCE CO., a Georgia corporation, with its mailing address at 4370 Peachtree Road, N.E.,
Atlanta, Georgia 30319 (hereinafter called the “Lessor”), and ATLANTIC AMERICAN CORPORATION,
BANKERS FIDELITY LIFE INSURANCE COMPANY, and GEORGIA CASUALTY AND SURETY COMPANY, all Georgia
corporations, with their mailing addresses at 4370 Peachtree Rd., N.E., Atlanta, Georgia 30319
(hereinafter collectively called the “Lessee”);

W I T N E S S E T H:

     The Lessor hereby leases to the Lessee, and the Lessee hereby leases from the Lessor, the
following described property, (hereinafter referred to as the “Premises”):

Space located in the Peachtree Insurance Center Building of approximately 65,489
square feet, being presently occupied by the Lessee, and located at the
following address: 4370 Peachtree Road, N.E., Atlanta, Georgia 30319.

     Lessor and Lessee agree this Lease includes Lessee’s pro-rata share of parking spaces for
conventional automobiles in the parking deck located at the rear of the building in which the
Premises are located. Lessor reserves the right to make and enforce such rules and regulations as
Lessor deems necessary and appropriate for the regulation of the use of such parking spaces.
Lessor further reserves the right to relocate such spaces from time to time in order to
accommodate Lessor’s parking requirements.

     1. TERM

     The lease term shall commence as of the first day of the first month following approval by
the Georgia Department of Insurance. (hereinafter called the “Term Commencement Date”).

     2. USE AND POSSESSION

     It is understood that the Premises are to be used for general office purposes and for no
other purpose without prior written consent of Lessor. Lessee shall not use the Premises for any
unlawful purpose or so as to constitute a nuisance. The Lessee, at the expiration of the term,
shall deliver up the Premises in good repair and condition, damages beyond the control of the
Lessee, reasonable use, ordinary decay, wear and tear excepted. All alterations, additions or
improvements (including, but not limited to, carpets, drapes and drape hardware) shall become the
property of Lessor at the expiration of this Lease.

 

 

     3. RENT

     Lessee hereby covenants and agrees to pay to the Lessor, or to such other party as Lessor
designates, without deduction, demand or set-off, an annual rent of $622,146.00 (based upon a rate
of $9.50 per annum per square foot), in equal monthly installments, payable in advance beginning
on the Term Commencement Date of this Lease and on the first day of each and every month
thereafter of $51,845.50 (hereinafter called “Rent”). Rent shall be paid to Lessor at the address
set forth above, or at such other address as Lessor shall provide in writing. Rent will be
adjusted in the manner set forth in Paragraph Four. Lessor may charge Lessee a late charge of
three (3%) percent of such payment for each payment of rent or other sums due hereunder which are
not received by the Lessor within ten (10) days of the applicable due date. No termination of this
Lease prior to the normal ending hereof shall affect Lessor’s right to collect rent for the period
prior to such termination.

     4. RENT ADJUSTMENT

     Rent shall be adjusted on every fifth anniversary of the Term Commencement Date, in
accordance with terms that the parties find mutually agreeable. In the absence of such agreement
thirty days prior to each fifth anniversary, rent shall continue at the current rate until an
agreeable rent is negotiated.

     5. LEASE CANCELLATION

     The lease shall be in effect continuously unless written notice of cancellation is provided
by either party at least twelve months in advance of the actual termination date.

     6. SALES AND USE TAX

     The Lessee hereby covenants and agrees to pay monthly, as additional rent, any sales, use or
other tax, excluding State and/or Federal Income Tax, now or hereafter imposed upon rents by the
United States of America, the State, or any political subdivision thereof, to the Lessor,
notwithstanding the fact that such statute, ordinance or enactment imposing the same may endeavor
to impose the tax on the Lessor.

     7. ORDINANCES AND REGULATIONS

     The Lessee hereby covenants and agrees to comply with all the rules and regulations of the
Board of Fire Underwriters. Officers or Boards of the City, County or State having jurisdiction
over the Premises, and with all ordinances and regulations of governmental authorities wherein the
Premises are located, at Lessee’s sole cost and expense, but only insofar as any of such rules,
ordinances and regulations pertain to the manner in which the Lessee shall use the Premises.

2

 

     8. SERVICES

     Lessor covenants and agrees to provide the necessary services in order for the Premises to be
used as a general office building.

     The Lessee does hereby agree to pay the pro-rata share of all real estate taxes, general
maintenance expenses and upkeep of building, including necessary service contracts for heating and
air-conditioning, elevator, music service, pest control, exterior maintenance, sanitary supplies,
interior and exterior lighting, yard maintenance, yard equipment and repairs, water and sewerage
service, electrical service, plumbing repairs, mechanical repairs, paving or parking deck repairs,
garbage and sanitation service, redecorating or changes to common areas, janitorial service,
window cleaning, and insurance coverage sufficient to cover the fair market value of the building
and improvements. Insurance includes any liability coverage for the protection of the Lessor and
Lessee. The Lessee also agrees to pay the pro-rata share of any other requirements such as maid
service, additional security system, and/or any other items not specifically determined. The
Lessee agrees to pay the pro-rata share of expense to Lessor on a current monthly basis. The
Lessee hereby assumes complete responsibility for the direct maintenance cost and upkeep of its
computer air-conditioning system. Lessor shall provide a reasonable amount of parking at its
standard rates for Lessee’s employees and visitors on Lessor’s parking area adjacent to the
building in which the Premises are situated.

     If the Lessee shall require electrical current or install electrical equipment including, but
not limited to, electrical heating, refrigeration equipment, electronic data processing machines,
punch card machines, or machines or equipment using current which will in any way increase the
amount of the electricity usually furnished for use in general office space, Lessee will obtain
prior written approval from the Lessor and pay periodically for the additional direct expense
involved, including any installation cost thereof.

     Lessor shall in no way be liable for cessation of any of the above services caused by strike,
accident or reasonable breakdown, nor shall Lessor be liable for damages from the stopping of
elevators or elevator service, or any of the fixtures or equipment in the building being out of
repair, or for injury to person or property, caused by any defects in the electrical equipment,
heating, ventilating and air-conditioning system, elevators or water apparatus, or for any damages
arising out of failure to furnish the services enumerated in this paragraph.

     Lessor’s obligation to furnish light, heat and power shall be conditioned upon the
availability of adequate energy sources. Lessor shall have the right to reduce heat and lighting
as required by any mandatory or voluntary fuel or energy saving, allocation or similar statute,
regulation, order or program.

     9. INSURANCE

     Lessee shall carry all risk of physical loss insurance insuring its interest in Lessee’s
improvements in

3

 

the Premises and its interest in its furniture, equipment and supplies. Lessee
shall also keep in full force and
effect liability insurance protecting Lessee and Lessor with limits of liability in an amount
to be determined by Lessor, to include fire damage and water damage legal liability. Lessor shall
be furnished with evidence of such insurance, including evidence that Lessor-is named as an
additional insured under such policy. Such policy shall provide that it may not be canceled unless
a minimum of thirty (30) days notice of such cancellation is given to Lessor.

     Lessor and Lessee each hereby release the other from any and all liability or responsibility
to the other or anyone claiming through or under them by way of subrogation or otherwise for any
loss or damage to property caused by fire or other perils insured in policies of insurance
covering such property, even if such loss or damage shall have been caused by the fault or
negligence of the other party, or anyone for whom such party may be responsible, including,
without limitation, any other tenants or occupants of the remainder of the building; provided,
however, that this release shall be applicable and in force and effect only to the extent that
such release shall be lawful at that time and in any event only with respect to loss or damage
occurring during such time as the releasor’s policy shall contain a clause or endorsement to the
effect that any such release shall not adversely affect or impair said policies or prejudice the
right of the releasor to recover thereunder, and then only to the extent of the insurance proceeds
payable under such policies. Lessor and Lessee each agree that they will request their insurance
carriers to include in their policies such a clause or endorsement. If extra costs shall be
charged therefore, each party shall advise the other thereof and of the amount of the extra cost,
and the other party, at its election, may pay the same, but shall not be obligated to do so. If
such other party fails to pay such extra cost, the release provisions of this paragraph shall be
inoperative against such other party to the extent necessary to avoid invalidation of such
releasor‘s insurance.

     10. ALTERATIONS

     Lessee, by occupancy hereunder, accepts the Premises as being in good repair and condition.
Lessee shall not make or suffer to be made any alterations, additions or improvements to or of the
leased Premises, or any part thereof, without prior written consent of Lessor, which consent the
Lessor covenants and agrees shall not be unreasonably withheld. In the event Lessor consents to
the proposed alterations, additions, or improvements, the same shall be at Lessee’s sole cost and
expense, and Lessee shall hold Lessor harmless on account of the cost thereof and shall bond any
mechanics or materialmens’s lien which is filed on account of such work within fifteen (15) days
of its filing. Any such alterations shall be made at such times and in such manner as not to
unreasonably interfere with the occupations, use and enjoyment of the remainder of the building by
the other tenants thereof. If required by Lessor, such alterations shall be removed by Lessee upon
the termination or sooner expiration of the term of this Lease, and Lessee shall repair damage to
the Premises caused by such removal, all at Lessee’s cost and expense.

4

 

	     11. 	 	QUIET ENJOYMENT

     The Lessor covenants and agrees that Lessee, in paying said monthly rent and performing the
covenants herein, and subject to the provisions of Paragraph 18 of this Lease, shall and may
peaceably and quietly hold and enjoy the said premises and common areas, including but not limited
to parking areas, sidewalks, entrances, lobbies, restrooms and lounges for the term aforesaid.

     12. LESSOR’S RIGHT TO INSPECT AND DISPLAY

     The Lessor shall have the right, at reasonable times during the term of this Lease, to enter
the Premises for the purpose of examining or inspecting same and of making such repairs or
alterations therein as the Lessor shall deem necessary, without being liable to Lessee in any
manner. The Lessor shall also have the right to enter the Premises at all reasonable hours for the
purpose of displaying said premises to prospective tenants within ninety (90) days prior to the
termination of this Lease.

     13. DESTRUCTION OF PREMISES

          (a) If the Premises are totally destroyed by fire or other casualties, both the
Lessor and Lessee shall have the option of terminating this Lease or any renewal
thereof, upon giving written notice at any time within thirty (30) days from the date
of such destruction, and if the Lease be so terminated, all rent shall cease as of the
date of such destruction and any prepaid rent shall be refunded.

          (b) If such Premises are partially damaged by fire or other casualty, or totally
destroyed thereby, and neither party elects to terminate this Lease within the
provisions of paragraph (a) above or (c) below, then the Lessor agrees, at Lessor’s
sole cost and expense, to restore the Premises to a kind and quality substantially
similar to that immediately prior to such destruction or damage. Said restoration shall
be commenced within a reasonable time and completed without delay on the part of the
Lessor and in any event shall be accomplished within 150 days from the date of the fire
or other casualty. In such case, all rents paid in advance shall be apportioned as of
the date of damage or destruction, and all rent thereafter accruing shall be equitably
and appropriately suspended and adjusted according to the nature and extent of the
destruction or damage, pending completion of rebuilding, restoration or repair, except
that in the event the destruction or damage is, in Lessor’s determination, so extensive
as to make it unfeasible for the Lessee to conduct Lessee’s business on the Premises,
the rent shall be completely abated until the Premises are restored by the Lessor or
until the Lessee resumes use and occupancy of the Premises, whichever shall first
occur. The Lessor shall not be liable for any inconvenience or interruption of business
of the Lessee occasioned by fire or other casualty.

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          (c) If the Lessor undertakes to restore, rebuild or repair the Premises, and such
restoration, rebuilding or repair is not accomplished within 150 days, and such
failure does not result from causes beyond the control of Lessor, the Lessee shall have the
right to terminate this Lease by written notice to the Lessor within thirty (30) days after
expiration of said 150 day period.

          (d) Lessor shall not be liable to carry fire, casualty or extended damage insurance on
the person or property of the Lessee or any person or property which may now or hereafter
be placed in the Premises.

     14. RULES AND REGULATIONS

     Lessee will observe and comply with the Rules and Regulations set forth in Exhibit
“A” hereof, which are incorporated herein by reference, and such amendments and additions
thereto as Lessor may prescribe by written notice to Lessee.

     15. CONDEMNATION

     If during the term of this Lease or any renewal thereof, the whole of the Premises, or such
portion thereof as will make the Premises unusable for the purpose leased, be condemned by public
authority for public use, then, in either event, the term hereby granted shall cease and come to
an end as of the date of the vesting of title in such public authority, or when possession is
given to such public authority, whichever event last occurs. Upon such occurrence, the rent shall
be apportioned as of such date, and any prepaid rent shall be returned to the Lessee. The Lessor
shall be entitled to the entire award for such taking except to the extent prohibited by Georgia
law. If a portion of the Premises is taken or condemned by authority for public use so as not to
make the remaining portion of the premises unusable for the purposes leased, this Lease will not
be terminated but shall continue. If any portion of the Premises on the interior of the building
is so taken, the rent shall be equitably and fairly reduced or abated for the remainder of the
term in proportion to the amount of the Premises taken. In no event shall the Lessor be liable to
the Lessee for any business interruption, diminution in use, or for the value of any unexpired
term of this Lease.

     16. ASSIGNMENT AND SUBLEASE

     The Lessee covenants and agrees not to encumber or assign this Lease or sublet all or any
part of the Premises without the written consent of the Lessor. Such assignment shall in no way
relieve the Lessee from any obligations hereunder for the payment of rents or the performance of
the conditions, covenants and provisions of this Lease.

     In no event shall Lessee assign or sublet the Premises for any terms, conditions and
covenants other

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than those contained herein. In no event shall this Lease be assigned or be
assignable by operation of law or by voluntary or involuntary bankruptcy proceedings or otherwise,
and in no event shall this Lease or any rights or
privileges hereunder be an asset of Lessee under any bankruptcy, insolvency or reorganization
proceedings. Lessor shall not be liable nor shall the Premises be subject to any mechanics,
materialmen’s or other type liens, and Lessee shall keep the Premises and property in which the
Premises are situated free from any such liens and shall indemnify Lessor against and satisfy any
such liens which may obtain because of acts of Lessee notwithstanding the foregoing provision.

     17. HOLDOVER

     It is further covenanted and agreed that if the Lessee, any assignee or sub-lessee shall
continue to occupy the Premises after the termination of this Lease without prior written consent
of the Lessor, such tenancy shall be Tenancy at Sufferance. Acceptance by the Lessor of rent
after such termination shall not constitute a renewal of this Lease or a consent to such
occupancy nor shall it waive Lessor’s right of re-entry or any other right contained herein or
otherwise available to Lessor at law or in equity.

     18. ESTOPPEL CERTIFICATES

     Lessee shall, within ten (10) days after request by Lessor, execute, acknowledge and deliver
to Lessor a sworn, written statement regarding the status of this Lease, including the space
occupied, the rentals paid hereunder, the amount of any security deposit held hereunder, and
whether any defaults, off-sets or defenses exist in connection herewith.

     19. SUBORDINATION AND ATTORNMENT

     (a) Except as provided in Subparagraph (c) below with respect to mortgage subordination, this
Lease and all rights of Lessee hereunder are and shall be subject and subordinate to the lien and
security title of Lessor’s Mortgage (defined herein below). Lessee recognizes and agrees to the
rights of the holder of Lessor’s Mortgage to foreclose or exercise the power of sale against the
premises under Lessor’s Mortgage.

     (b) While subparagraph (a) above is self-operative, and no further instrument or
subordination shall be necessary, Lessee shall, in confirmation of such subordination, upon
demand, at any time or times, execute, acknowledge and deliver to Lessor or a holder of Lessor’s
Mortgage, any and all instruments requested by either of them to evidence such subordination.

     (c) Lessee shall, upon demand, at any time or times, execute, acknowledge and deliver to a
holder of Lessor’s Mortgage, any and all instruments that may be necessary to make this Lease
superior to the lien of Lessor’s Mortgage.

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     (d) If a holder of Lessor’s Mortgage shall hereafter succeed to the rights of Lessor under
this Lease, whether through possession, foreclosure, deed-under-power, deed-in-lieu or otherwise,
Lessee shall, at
the option of such holder, attorn to and recognize such successor as Lessee’s Lessor under
this Lease without change in the terms and provisions of this Lease (provided that such successor
shall not be bound by (i) any payment of rent or additional rent for more than one month in
advance, except prepayments in the nature of security for the performance by Lessee of its
obligations under this Lease, and then only if such prepayments have been deposited with and are
under the control of such successor, or (ii) any provision or amendment or modification of this
Lease, and shall promptly execute and deliver any instrument that may be necessary to evidence
such attornment. Upon such attornment, this Lease shall continue in full force and effect as a
direct lease between each successor Lessor and Lessee, subject to all of the terms, covenants and
conditions of this Lease.

     (e) If Lessee fails at any time to execute, acknowledge and deliver any of the instruments
provided for by Subparagraphs (b), (c) and (d) above within ten days after Lessor’s notice to do
so, Lessor, in addition to the remedies granted to Lessor in this Lease for a default, may
execute, acknowledge and deliver any and all of such instruments as the attorney-in-fact of Lessee
and in its name, place and stead, and Lessee hereby irrevocably appoints Lessor, its successors
and assigns as such attorney-in-fact.

     (f) From time to time and upon not less than five (5) days prior notice, Lessee shall
execute, acknowledge and deliver to a holder of Lessor’s Mortgage a statement in writing addressed
to it certifying (i) that this Lease is unmodified and in full force and effect (or if there have
been modifications, that the same are in full force and effect as modified and specifying the
modification), the date to which rent and other charges have been paid, and whether or not to the
knowledge of the signer there exists any failure by Lessor to perform any term, covenant or
condition contained in this Lease and, if so, specifying such failure. It is intended that any
such statement may be relied upon by a holder of Lessor’s Mortgage or a purchaser thereunder.

     As used in this paragraph, the term “Lessor’s Mortgage” means any of all mortgages, deeds to
secure debt, deeds of trust or other instruments in the nature thereof which may now or hereafter
affect or encumber Lessor’s title to the Premises.

     20. LESSOR’S LIABILITY

     The extent of any liability of Lessor arising hereunder or from Lessee’s use of the Premises
and the real estate on which such Premises are located shall be limited to Lessor’s interest in
such real estate.

     21. INDEMNIFICATION

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     The Lessor shall not be liable for any damage or injury to any person or property whether it
be the person or property of the Lessee, the Lessee’s employees, agents, guests, invitees or
otherwise by reason of Lessee’s occupancy of the Premises or because of fire, flood, windstorm,
Acts of God or for any other reason. The Lessee agrees to indemnify and save harmless the Lessor
from and against any and all loss, damage, claim,
demand, liability or expense by reason of damage to person or property which may arise or be
claimed to have arisen as a result of the occupancy or use of said Premises by the Lessee or by
reason thereof or in connection therewith, or in any way arising on account of any injury or
damage caused to any person or property on or in the Premises providing, however, that Lessee
shall not indemnify as to the loss or damage due to willful fault of Lessor. If Lessee’s use of
the Premises causes Lessor’s insurance premium for the building to be increased, the Lessee agrees
to pay, as additional rent plus any applicable sales or use taxes, the entire cost of such
increase.

     22. CONSTRUCTION OF LANGUAGE

     The terms lease, lease agreement or agreement shall be inclusive of each other, also to
include renewals, extensions or modifications of the Lease. Words of any gender used in this Lease
shall be held to include any other gender, and words in the singular shall be held to include the
plural and the plural to include the singular, when the sense requires. The paragraph headings and
titles are not a part of this Lease and shall have no effect upon the construction or
interpretation of any part hereof.

     23. DEFAULT

     In the event the Lessee shall default in the payment of rent or any other sums payable by the
Lessee herein, and such default shall continue for a period of ten (10) days, or if the Lessee
shall default in the performance of any other covenants or agreements of this Lease and such
default shall continue for thirty (30) days after written notice thereof, or if the Lessee should
become bankrupt or insolvent or any debtor proceedings be taken by or against the Lessee, then and
in addition to any and all other legal remedies and rights, the Lessor may declare the entire
balance of the rent for the remainder of the term to be due and payable and may collect the same
by distress or otherwise, and Lessor shall have a lien on the personal property of the Lessee
which is located in the Premises, and in order to protect its security interest in the said
property Lessor may, without first obtaining a distress warrant, lock up the Premises in order to
protect said interest in the secured property; or the Lessor may terminate this Lease and retake
possession of the Premises; or enter the Premises and re-let the same without termination, in
which latter event the Lessee covenants and agrees to pay any deficiency after Lessee is credited
with the rent thereby obtained less all repairs and expenses (including the expenses of obtaining
possession); or the Lessor may resort to any two or more of such remedies or rights or any other
remedies available at law or in equity, and adoption of one or more such remedies or rights shall
not necessarily prevent the enforcement of others concurrently or thereafter.

     The Lessee also covenants and agrees to pay reasonable attorneys’ fees and costs and expenses
of the

9

 

Lessor, including court costs, if the Lessor employs an attorney to collect rent or enforce
other rights of the Lessor herein in event of any breach as aforesaid, and the same shall be
payable regardless of whether collection or enforcement is effected by suit or otherwise.

     Rent and other sums due hereunder shall accrue interest at a rate per annum equal to fifteen
percent (15.0%) per annum from and after ten (10) days
after the applicable due date hereunder
until paid-in-full. Such interest shall be due and payable by Lessee to Lessor upon demand and as
a condition of cure.

     24. SUCCESSORS AND ASSIGNS

     Except as provided in paragraph 16 above, this Lease shall bind and inure to the benefit of
the successors, assigns, heirs, executors, administrators and legal representatives of the
parties hereto.

     25.  NON-WAIVER

     No waiver of any covenant or condition of this Lease by either party shall be deemed to
imply or constitute a further waiver of the same covenant or condition or any other covenant or
condition of this Lease.

     Lessee has only a usufruct under this agreement not subject to levy and sale; no estate
shall pass out of Lessor.

     26. NOTICES

     For the purpose of notice or demand, the respective parties shall be served by certified or
registered mail, return receipt requested, addressed to the Lessee at its mailing address as set
further herein, or posted at the Premises, and to the Lessor at its mailing address as set forth
on the first page. All notices shall be deemed given on the date delivered, if by hand delivery or
posting, or on the date deposited in the mail, if mailed.

     27. SPECIAL STIPULATIONS

     Special stipulations, if any, set forth below or attached hereto shall control if in conflict
with any of the foregoing provisions of this Lease.

     28. MISCELLANEOUS

          (a) Governing Law. This Lease shall be construed and enforced in
accordance with the laws of the State of Georgia.

          (b) Counterpart Copies. This agreement may be executed in two (2) or more
counterpart copies, all of which counterparts shall have the same force and effect as
if all parties hereto have

10

 

executed a single copy of this Lease.

     (c) Entire Agreement. This Agreement contains the final and entire
agreement between the parties hereto with respect to the lease of the Premises
described herein, and is intended to be an integration of all prior negotiations and
understandings. No party shall be bound by any term,
condition, statement, warranty or representation, oral or written not contained
herein. No change or modification of the Lease shall be valid unless the same is in
writing and signed by the parties hereto. No waiver of any provision of this Lease
shall be valid unless in writing and signed by the party against which it is sought to
be enforced.

     (d) Severability. If all or any portion of any of the provisions of this
Lease shall be declared invalid by laws applicable thereto, then the performance of
such offending provisions shall be excused by the parties hereto, and this Lease shall
be valid and enforceable as to all other provisions thereof.

     (e) Authority of Lessee. Lessee represents and warrants that Lessee and
the person or persons executing this Lease, on behalf of Lessee, have the full
and entire right, power and authority to execute this Lease and to perform the
obligations hereunder.

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     IN WITNESS WHEREOF, Lessee and Lessor have caused this instrument to be executed under seal
as of the date first above written, by their respective officers or parties thereunto duly
authorized.

	 	 	 	 	 	 	 
	 	 	“LESSOR”
	 
	 	 	 	 	 	 
	 	 	DELTA LIFE INSURANCE CO., a Georgia
corporation
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ James B. Falkler
	 	Secretary/Treasurer 
	 

	 	 	 	 
	 	 
	 

	 	 	 	 	 	Title
	 
	 	 	 	 	 	 
	 

	 	Attest:
	 	/s/ Jeff Donahue
	 	Controller
	 

	 	 	 	 
	 	 
	 

	 	 	 	 	 	Title
	 	 	(SEAL)

	 	 	 	 	 	 	 
	 	 	“LESSEE”
	 
	 	 	 	 	 	 
	 	 	ATLANTIC AMERICAN CORPORATION, a Georgia
corporation
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ John G. Sample
	 	CFO 
	 

	 	 	 	 
	 	 
	 

	 	 	 	 	 	Title
	 
	 	 	 	 	 	 
	 

	 	Attest:
	 	/s/ Janie L. Ryan
	 	Secretary
	 

	 	 	 	 
	 	 
	 

	 	 	 	 	 	Title
	 	 	(SEAL)

12

 

	 	 	 	 	 	 	 
	 	 	BANKERS FIDELITY LIFE INSURANCE COMPANY, a Georgia

corporation
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Eugene Choate
	 	President
	 

	 	 	 	 
	 	 
	 

	 	 	 	 	 	Title
	 
	 	 	 	 	 	 
	 

	 	Attest:
	 	/s/ Janie L. Ryan
	 	Assistant Secretary
	 

	 	 	 	 
	 	 
	 

	 	 	 	 	 	Title
	 	 	(SEAL)

	 
	 	 	 	 	 	 
	 	 	GEORGIA CASUALTY AND SURETY COMPANY, a Georgia

corporation
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Dianne Morris
	 	President
	 

	 	 	 	 
	 	 
	 

	 	 	 	 	 	Title
	 
	 	 	 	 	 	 
	 

	 	Attest:
	 	/s/ Janie L. Ryan
	 	Assistant Secretary
	 

	 	 	 	 
	 	 
	 

	 	 	 	 	 	Title
	 	 	(SEAL)

13

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