Document:

Placement Slip

Exhibit 10.67 
 

	 GUY CARPENTER
	 	 Guy Carpenter & Company, Inc.

	
	 	 	 	 	 44 Whippany Road
	 	 Telephone    973-401-5000

	 	 	 	 	 P.O. Box 1966
	 	 Facsimile     973-984-8260

	 	 	 	 	 Morristown, New Jersey 07962-1966

	
	 Placement Slip
	 	 
	

	 	 	 	 	 File #:
	 	 8493-0009-01/2/3/4

	 	 	 	 	 Effective Date:
	 	 January 1, 2003

 
 
COMPANY:  
 
SCPIE HOLDINGS, INC., 
AND/OR SCPIE INDEMNITY COMPANY, 
AND/OR AMERICAN HEALTHCARE
INDEMNITY COMPANY, 
AND/OR AMERICAN HEALTHCARE SPECIALTY COMPANY, 
AND/OR SCPIE INSURANCE SERVICES, INC., 
AND/OR SCPIE MANAGEMENT SERVICES, INC., 
LOS ANGELES, CALIFORNIA 
 
TYPE: 
 
FIRST – FOURTH EXCESS OF LOSS REINSURANCE 
 
BUSINESS COVERED: 
 

	 	1.	 	Physicians & Surgeons Comprehensive Professional and Business Liability, including Clinics and Clinical Laboratories. 

 

	 	2.	 	Professional and Business Liability Policies for Hospitals and Healthcare Facilities, including: 

 

	 	a.	 	Modified Claims Made Coverage Hospitals and Medical Centers (Primary & Excess); 

 

	 	b.	 	Claims Made Coverage Hospitals and Medical Centers (Primary & Excess); 

 

	 	c.	 	Excess Automobile Liability and Excess Employers Liability associated with the policy forms outlined above. 

 

	 	3.	 	Errors and Omissions Liability Policies for Managed Care Organizations, and Directors and Officers Liability Policies. 

	 	 	 	 	 Page
	 	 2 of 7

	 	 	 	 	 File #:
	 	 8493-0009-01/2/3/4

	 	 	 	 	 Effective Date:
	 	 January 1, 2003

 
BUSINESS
COVERED (Continued): 
 

	 	4.	 	Physicians and Surgeons Comprehensive Professional Liability and Personal Umbrella Business underwritten by Brown & Brown, Inc., Tampa, Florida.

 
TERM: 
 
 
January 1, 2003 to December 31, 2003 as respects claims made during the calendar year 2003. 
 
The term “claims made” as used herein shall mean (A) In respect of Claims Made Policies, claims first notified to the Company
during the term of this Agreement on any inforce policy or reporting endorsement arising out of incidents subsequent to the retroactive date of said policy as the result of the rendering of or failure to render a professional service or the
reporting of losses which arise from the insured premises and operations incidental to the practice of a physician, hospital or managed care organization and/or (B) In respect of Occurrence, or Modified Claims Made Policies, claims or losses first
notified to the Company during the term of this Agreement. 
 
Retroactive date January 1, 1976, except for Extra Contractual Obligations which is January 1, 1979. 
 
In the event of cancellation or non-renewal, and at the option of the Reinsured, Reinsurers agree to run-off policies in force until
natural expiration not to exceed 12 months from the expiration date hereon, at terms to be mutually agreed. 
 
TERRITORY: 
 
As per the Company’s original policies, contracts, or binders. 
 
EXCLUSIONS: 
 

	 	1.	 	Insolvency Funds. 

 

	 	2.	 	Nuclear Incident—Liability—Reinsurance. 

 

	 	3.	 	Assumed Reinsurance other than for Licensing, Financial Rating Purposes or Acquisition Purposes. 

 

	 	4.	 	Terrorism per NMA 2929. 

	 	 	 	 	 Page
	 	 3 of 7

	 	 	 	 	 File #:
	 	 8493-0009-01/2/3/4

	 	 	 	 	 Effective Date:
	 	 January 1, 2003

 
LIMIT AND
RETENTION: 
 
First
Layer: 
 

	 	A.)	 	$3,000,000 each and every loss in excess of $2,000,000 each and every loss. 

 
Reinsurers maximum aggregate liability, during the term of this Agreement shall be $18,000,000. 
 
Not withstanding the foregoing it is a condition hereto that
an Annual Aggregate Deductible of $3,000,000, otherwise recoverable, shall first be deducted before any liability attaches hereon. 
 
Second Layer: 
 

	 A.)
	  	 $5,000,000 each and every loss in excess of $5,000,000 each and every loss.

	
	 B.)
	  	 Reinstatements—
	 	 First—Computed Pro-Rata as to amount, 60% as to Premium.

	
	 	  	 	 	 Second—Computed Pro-Rata as to amount, 100% as to Premium.

 
 
Third Layer: 
 

	 A.)
	  	 $10,000,000 each and every loss in excess of $10,000,000 each and every loss.

	
	 B.)
	  	 Reinstatements—
	 	 One in all computed Pro-Rata as to amount, 100% as to Premium.

 
Fourth Layer: 
 

	 A.)
	  	 $30,000,000 each and every loss in excess of $20,000,000 each and every loss

	
	 B.)
	  	 Reinstatements—
	 	 One in all computed Pro Rata as to amount, 100% as to Premium.

 
WARRANTY:

 

	 1.)
	  	 In respect of Physicians and Surgeons Comprehensive Professional and Business Liability Policies, including Clinics
and Clinical Laboratories, the Maximum Policy Limit is $10,000,000 subject to inuring protection of $8,000,000 in excess of $2,000,000 with a maximum aggregate of $8,000,000 during each 12 month period, or so deemed.

	 	 	 	 	 Page
	 	 4 of 7

	 	 	 	 	 File #:
	 	 8493-0009-01/2/3/4

	 	 	 	 	 Effective Date:
	 	 January 1, 2003

 
WARRANTY
(Continued): 
 

	 	2.)	 	Coverage for Professional and Business Liability Policies for Hospitals is restricted to policies incepting prior to January 1, 2002, the Maximum Policy Limit is
$50,000,000, or so deemed. 

 

	 	3.)	 	In respect of Professional and Business Liability Policies for Healthcare Facilities, the Maximum Policy Limit is $10,000,000 for policies incepting prior to January
1, 2002, and $5,000,000 for policies incepting on or after January 1, 2002, or so deemed. 

 

	 	4.)	 	In respect of Errors and Omissions Liability Policies for Managed Care Organizations, Directors and Officers Liability Policies, and Employment Practices Liability
Insurance, the Maximum Policy Limit is $5,000,000 for policies incepting prior to January 1, 2002, and $1,000,000 for policies incepting on or after January 1, 2002, or so deemed. 

 

	 	5.)	 	In respect of Professional and Business Liability Policies for Dentists, excluding coverages for Oral and Maxillofacial Surgeons, the Maximum Policy Limit is
$10,000,000, for policies incepting prior to January 1, 2002, and $2,000,000 for policies incepting on or after January 1, 2002, or so deemed. 

 
PREMIUM: 
 
First Layer: 
4.43% of G.N.E.P.I. 
Deposit—$5,760,000 payable
$2,880,000 semi-annually. 
Minimum—$4,600,000 
 
Second Layer: 
2.47% of G.N.E.P.I. 
Deposit—$3,210,000 payable $1,605,000 semi-annually. 
Minimum—$2,568,000 
 
Third Layer: 
1.45% of G.N.E.P.I. 
Deposit—$1,885,000 payable $942,500 semi-annually. 
Minimum—$1,508,000 
 
Fourth Layer: 
1.00% of G.N.E.P.I. 
Deposit—$1,300,000 payable $650,000
semi-annually. 
Minimum—$1,040,000. 

	 	 	 	 	 Page
	 	 5 of 7

	 	 	 	 	 File #:
	 	 8493-0009-01/2/3/4

	 	 	 	 	 Effective Date:
	 	 January 1, 2003

 
ATTACHMENT
OF LIABILITY: 
 

	 	(A)	 	For purposes of determining the attachment of the Reinsurers liability hereunder as respects any one loss, all losses (including Discovery Period Losses) involving
one or more Original Insureds, arising from the same incident, and in which First Notice of Claim or Circumstance is notified to the Company during the term of this Agreement shall be covered hereunder. 

 

	 	(B)	 	The date of a loss hereunder shall be the earliest date, within the term of this Agreement, that the Company has received First Notice of Claim or Circumstance.

 
ACCOUNTING: 
 
Premiums—Payments within 60 days of
respective due date. 
Losses—Payments within 60 days of receipt of proof of loss. 
Outstanding losses reported individually as they occur. 
 
GENERAL CONDITIONS: 
 
Loss Adjustment Expenses to be included with the Ultimate Net Loss. 
Excess of Original Policy Limits Clause. 
80% Extra Contractual Obligations Clause. 
Ultimate Net Loss Clause including Declaratory Judgement Expenses incurred in connection with coverage questions and
legal actions related to a specific claim. 
Net Retained Lines Clause. 
Notice of Loss Clause. 
Loss Funding Clause—Including IBNR (See Attached). 
Special Funding Clause. 
Confidentiality Clause. 
Commutation Clause by Mutual Agreement. 
Federal Excise Tax Clause. 
Errors and Omissions Clause. 
Insolvency Clause.

Offset Clause—BRMA 36A 
Service of Suit Clause. 
Mode of Execution Clause. 
Arbitration Clause. 
Access to Records Clause. 
Guy Carpenter & Company, Inc. Intermediary Clause. 

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	 	 6 of 7

	 	 	 	 	 File #:
	 	 8493-0009-01/2/3/4

	 	 	 	 	 Effective Date:
	 	 January 1, 2003

 
INFORMATION: 
 
 

	 	 	 2003 Premium Estimates by Line:
	  	 	 
	
	 	 	 Physicians SCPIE
	  	 $
	 87,600,000

	 	 	 Physicians (Standard) AHI-CA
	  	 $
	 12,200,000

	 	 	 Physicians Other than CA. Std. AHI
	  	 $
	 1,800,000

	 	 	 Physicians—Non Standard AHI
	  	 $
	 1,300,000

	 	 	 Physicians—Non Standard AHSIC
	  	 $
	 300,000

	 	 	 	  	
	

	 	 	 Subtotal:        
	  	 $
	 103,200,000

	
	 	 	 Hospitals
	  	 $
	 300,000

	 	 	 Healthcare Facilities
	  	 $
	 6,800,000

	 	 	 Healthcare Providers
	  	 $
	 1,600,000

	 	 	 Umbrella
	  	 $
	 500,000

	 	 	 Managed Care E&O
	  	 $
	 700,000

	 	 	 Directors & Officers
	  	 $
	 1,000,000

	 	 	 	  	
	

	 	 	 Subtotal:        
	  	 $
	 10,900,000

	
	 	 	 Brown & Brown
	  	 	 
	 	 	 Physicians
	  	 $
	 14,100,000

	 	 	 Phys.—Dentists & Oral Surgeons
	  	 $
	 1,800,000

	 	 	 	  	
	

	 	 	 Subtotal:        
	  	 $
	 15,900,000

	
	 	 	 Grand Total:
	  	 $
	 130,000,000

 
 
REGULATION 98: 
 
Premium and loss payments made to Guy Carpenter & Company, Inc. shall be deposited in a Premium and Loss Account in accordance with
Section 32.3(a)(1) of Regulation 98 of the New York Insurance Department. The parties hereto consent to withdrawals from said account in accordance with Section 32.3(a)(3) of the Regulation, including interest and Federal Excise Tax. 

 

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	 	 7 of 7

	 	 	 	 	 File #:
	 	 8493-0009-01/2/3/4

	 	 	 	 	 Effective Date:
	 	 January 1, 2003

 
ACCEPTED: 
 

	             First Layer:
	 	 
	 	 	

	
	             Second Layer:
	 	 
	 	 	

	
	             Third Layer:
	 	 
	 	 	

	
	             Fourth Layer:
	 	 
	 	 	

	
	 Reinsurer:
	 	 
	 	 	

	
	 Reference #:
	 	 
	 	 	

	
	 FEIN # & NAIC #:
	 	 
	 	 	

	
	 Authorized Signature:
	 	 
	 	 	

	
	 Date:Deferred Compensation Agreement

 
Exhibit 10.68

 
DEFERRED COMPENSATION AGREEMENT

 
RECITALS 
 
 
This Deferred Compensation Agreement (this “Agreement”) is made and entered into as of January 1, 2001, by and between SCPIE Management Company (the “Company”), and Donald P. Newell (“Executive”).

 
WHEREAS, Executive is the Senior Vice President
and General Counsel of the Company and of the Company’s parent company, SCPIE Holdings Inc. (“Holdings”), and shall serve in such business and legal capacity as the Board of Directors of Holdings (the “Board”) shall
determine from time to time; 
 
WHEREAS, the
Company and Executive have entered into an Employment Arrangement dated October 30, 2000, which became effective January 1, 2001 (the “Employment Arrangement”); 
 
WHEREAS, pursuant to Paragraph 5 of the Employment Arrangement, Executive is entitled to receive certain
deferred compensation benefits; and 
 
WHEREAS, the
Company and Executive desire to enter into this Agreement in order to set forth the terms and conditions of the Employment Arrangement relating to the deferred compensation benefits. 
 
 
AGREEMENT 
 
 
NOW, THEREFORE, in consideration of the premises and mutual covenants contained herein, the receipt of which is hereby acknowledged, the parties hereto agree as follows: 
 

	1.	 	Contribution and Interest Credits. 

 
1.1    On the last day of each month during the period beginning on January 1, 2001 and ending on the last day of the
month in which Executive’s employment with the Company is terminated (the “Crediting Period”), the Company shall credit an amount equal to Sixteen Thousand Six Hundred and Sixty Seven Dollars ($16,667.00) to an account (the
“Account”) in its books and records, which Account shall be maintained for the purpose of providing Executive with deferred compensation benefits, subject to the following terms and conditions. (The amounts credited to the Account under
this Section 1.1 are hereinafter referred to as the “Contribution Credits”). 
 
1.2    On April 30, 2001 and quarterly thereafter the Company shall credit the principal balance of the Account with interest at the rate of nine percent (9%) per annum, compounded
quarterly, until the Account shall have been fully distributed, as provided below. 

 

	2.	 	Payment of Account. 

 
2.1    The principal balance and accrued interest of the Account (the “Deferred Compensation”) shall be
payable to Executive in substantially equal monthly installments beginning on January 31, 2008 and ending on December 31, 2017 (the “Payment Term”); provided, however, that at any time before January 1, 2008 (the “Benefit Commencement
Date”), Executive may elect to have the Deferred Compensation payable beginning at a different date or over such different period of time as Executive may irrevocably elect in writing, subject to the approval of the Company’s Board of
Directors in its sole and absolute discretion. 
 
2.2    In the event that Executive’s employment by the Company is terminated by reason of Executive’s death prior to the Benefit Commencement Date or in the event of Executive’s death prior to the
expiration of the Payment Term, the entire unpaid balance of the Account as of the date of Executive’s death, including interest accrued thereon to the date of death at the rate prescribed by Section 1.2, shall be paid in a lump sum within
sixty (60) days after the date of death to the beneficiary or beneficiaries which Executive has designated in a written notice to the Company. If Executive has not designated a beneficiary, such amount shall be paid to Executive’s estate.
Executive may revoke or amend his beneficiary designation from time to time. 
 
2.3    In the event of a “Change in Control” (as defined below) of the Company, the unpaid balance of the Account as of the effective date of such Change in Control,
including all interest accrued thereon to the effective date of such Change in Control at the rate prescribed by Section 1.2, shall be immediately due and payable; provided, however, that at any time prior to the effective date of the Change in
Control, Executive may elect to have the Deferred Compensation not be paid pursuant to this Section 2.3 and to have the Deferred Compensation continue to be held and distributed according to the other provisions of this Agreement. 
 
Solely for purposes of this Agreement, Change in Control shall
be deemed to occur if: 
 
(a) any Person (as
defined in Sections 13(d) and 14(d) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) is or becomes the Beneficial Owner (as defined in Rule 13d-3 under the Exchange Act), directly or indirectly, of securities of the
Company representing 20% or more of the combined voting power of the Company’s then outstanding securities (“Outstanding Company Voting Securities”); provided, however, that for purposes of this subsection (a), the following shall not
constitute a Change in Control: (i) any acquisition by the Company or any corporation controlled by the Company, (ii) any acquisition by any employee benefit plan (or related trust) sponsored or maintained by the Company or any corporation
controlled by the Company, or (iii) any acquisition by a Person of 20% of the Outstanding Company Voting Securities as a result of an acquisition of common stock of the Company by the Company which, by reducing the number of shares of common stock
of the Company outstanding, increases the proportionate number of shares beneficially owned by such Person to 20% or more of the Outstanding Company Voting Securities; provided, however, that if a Person shall become the beneficial owner of 20% or
more of the Outstanding Company Voting Securities by reason of a share acquisition by the Company as described above and shall, after such share acquisition by the Company, become the beneficial owner of any additional 
 

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shares of common stock of the Company, then such acquisition shall constitute a Change in Control;

 
(b) during any period of two consecutive years
(not including any period prior to the execution of this Agreement), individuals who at the beginning of such period constitute the Board, and any new director (other than a director designated by a person who has entered into an agreement with
Company to effect a transaction described in clauses (a), (c), (d) or (e) of this definition) whose election by the Board or nomination for election by the Company’s stockholders was approved by a vote of at least two-thirds (K) of the
directors then still in office who either were directors at the beginning of the period or whose election or nomination for election was previously so approved (hereinafter referred to as “Continuing Directors”), cease for any reason to
constitute at least a majority thereof; 
 
(c) the
consummation by the Company of a merger or consolidation of Company with any other corporation (or other entity), other than a merger or consolidation which would result in the voting securities of the Company outstanding immediately prior thereto
continuing to represent (either by remaining outstanding or by being converted into voting securities of the surviving entity) 50% or more of the combined voting power of the voting securities of the Company or such surviving entity outstanding
immediately after such merger or consolidation; provided, however, that a merger or consolidation effected to implement a recapitalization of the Company (or similar transaction) in which no Person acquires more than 20% of the combined voting power
of the Company’s then outstanding securities shall not constitute a Change in Control; 
 
(d) the stockholders of the Company approve a plan of complete liquidation of the Company; or 
 
(e) the consummation of an agreement (or agreements) providing for the sale or disposition by the Company of all or substantially all of
the Company’s assets other than a sale or disposition which would result in the voting securities of the Company outstanding immediately prior thereto continuing to represent 50% or more of the combined voting power of the Company or such
surviving entity outstanding immediately after such sale or disposition. 
 
 

	3.	 	Miscellaneous Provisions. 

 
 
3.1    The Company shall withhold all
applicable income taxes and employment taxes from the amounts distributed hereunder as may be required by law. 
 
3.2    Notwithstanding anything contained in this Agreement, in the event that the Internal Revenue Service or any
state taxing authority makes a final determination which is not protested or appealed, or after a final determination with respect to any protest or appeal of any such determination, that all or any part of the Deferred Compensation is taxable to
Executive prior to the time that such amounts are actually distributed to Executive, the entire unpaid balance of the Account as of the date of such determination, including all interest accrued thereon to the date of such final determination at the
rate prescribed by Section 1.2, shall be paid to Executive in a lump-sum within thirty (30) days after the date of such final determination. 
 

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3.3    The Account shall not be assignable by Executive and shall not be subject to attachment, lien, levy, or other creditors’ rights under state or Federal law. 
 
3.4    Benefits under this Agreement shall
be payable from the general assets of the Company or pursuant to such other means as the Company deems appropriate and Executive shall not be entitled to look to any source for payment of such benefits other than the general assets of the Company.

 
3.5    The Deferred
Compensation and any payments with respect to such amounts shall not constitute compensation for the purposes of any benefit plan or agreement maintained by the Company unless expressly provided otherwise in such plan or agreement. 
 
3.6    Nothing in this Agreement shall
confer upon Executive any right to continue in the employ of the Company or shall interfere with or restrict in any way the rights of the Company, which are hereby expressly reserved, to discharge Executive at any time for any reason whatsoever,
with or without Cause. 
 
3.7    The Company and Executive agree that (i) the provisions of this Agreement constitute a “pension benefit plan” within the meaning of Section 3(2) of the Employee Retirement Income Security Act of
1974, as amended (“ERISA”), (ii) such plan is unfunded and is maintained primarily for the purpose of providing deferred compensation for a select group of management or highly compensated employees, within the meaning of Sections 201(2),
301(a)(3) and 401(a)(1) of ERISA, and (iii) the provisions of this Agreement shall be governed by federal law. 
 
IN WITNESS WHEREOF, the parties hereto have each executed this Agreement effective as of the date first written above. 
 
 
 

	 SCPIE MANAGEMENT COMPANY

	
	 By:
	 	 /S/    DONALD J. ZUK

	 	 	 Its:    President

 
 
 
 

	 /S/    DONALD P.
NEWELL

	           Donald P. Newell

 
 
 

4 

 
GUARANTY

 
 
1.    FOR VALUE RECEIVED and in consideration for, and as an inducement to Donald P. Newell (the “Executive”) entering into and continuing his performance under an
Employment Arrangement dated October 30, 2000, including a Deferred Compensation Agreement dated as of January 1, 2001, with SCPIE Management Company (collectively, the “Agreement”), SCPIE Holdings Inc. (“SCPIE Holdings”)
absolutely, irrevocably and unconditionally guarantees to Executive, and his successors and assigns, the full and timely payment by SCPIE Management Company to Executive of the compensation required to be paid and benefits required to be provided by
SCPIE Management Company to Executive under said Agreement on the terms and conditions set forth in said Agreement. 
 
2.    This Guaranty is a guaranty of payment, not collection, and Executive shall not be required to first pursue his
remedies against SCPIE Management Company but may instead proceed to enforce all of his rights and remedies directly against SCPIE Holdings or against SCPIE Management Company and SCPIE Holdings at the same time. This Guaranty cannot otherwise be
terminated or modified without the written consent of Executive. Guarantor hereby waives notice of acceptance of this Guaranty, as well as all demands, presentments, notices of protest and notices of every kind and nature. 
 
3.    If any dispute arises pertaining to
this Guaranty, such dispute will be submitted to binding arbitration in accordance with the Rules of the American Arbitration Association before a single neutral arbitrator, such arbitration to take place in Los Angeles, California and judgment upon
such award rendered by the arbitrator may be entered in any court having jurisdiction. 
 
Executed in Los Angeles, California, on October 23, 2002. 
 
 

	 SCPIE HOLDINGS INC.

	
	 By:
	 	 /S/    DONALD J. ZUK

	 	 	 Name:    Donald J. Zuk
 Its:        President and Chief Executive Officer

 

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