Document:

Exh. 10.1 EMP AGMT 05FEB14 GC

Exhibit 10.1
UNITED INSURANCE HOLDINGS CORP.
A Delaware Corporation

Employment Agreement

THIS EMPLOYMENT AGREEMENT (“Agreement”) is made and entered into as of the 5th day of February, 2014 (“Effective Date”) by and between UNITED INSURANCE HOLDINGS CORP., a Delaware Corporation, and any of its parent or subsidiary companies (collectively, the “Company”), and Kimberly Salmon (the “Executive”).

Recitals

		
	1.
	The Executive will be the General Counsel and Chief Legal Officer of the Company and has the requisite experience to serve as such.

		
	2.
	The Executive, in her duties, will come to possess intimate knowledge of the business and affairs of the Company and its Subsidiaries their policies, methods and personnel.

		
	3.
	The Board of Directors (the “Board”) of the Company recognizes that the Executive's contribution, as General Counsel and Chief Legal Officer of the Company, to the growth and success of the Company and its Subsidiaries will be substantial and desires to assure the Company of the Executive's employment in an executive capacity and to compensate him therefore.

		
	4.
	The Board has determined that this Agreement will reinforce and encourage the Executive's continued attention and dedication to the Company and its Subsidiaries.

		
	5.
	The Executive is willing to make her services available to the Company and its Subsidiaries on the terms and conditions hereinafter set forth.

Agreement

NOW, THEREFORE, in consideration of the premises and mutual covenants set forth herein, the parties hereby agree as follows:

		
	1.
	Term and Duties

		
	1.1 
	Term.  The Company shall employ the Executive and the Executive shall continue to serve the Company and its Subsidiaries on conditions set forth herein for a term that begins on the Effective Date and continues until the second (2) year anniversary of the Effective Date (“Initial Term”).  This Agreement shall automatically renew for additional one-year terms (“Renewal Term”), at the expiration of the Initial Term or any subsequent Renewal Term, unless the either party provides at least one-hundred eighty (180) days' written notice of their intent not to renew this Agreement, or unless this Agreement is otherwise terminated in accordance with Section 4.1 hereof.  

		
	1.2
	Duties of Executive.    During Executive's employment, the Executive shall serve as General Counsel and Chief Legal Officer and shall perform the duties of an executive commensurate with such position, shall diligently perform all services as may be reasonably designated by the CEO and the Board; and shall exercise such power and authority as is necessary and customary to the performance of such duties and services.  The Company has provided the Executive a written job description outlining the duties and authority of the General Counsel and Chief Legal Officer. The Executive shall devote her services on a fulltime basis to the business and affairs of the Company and the Subsidiaries.  Notwithstanding the foregoing, the Executive may be involved with charitable organizations.  Additionally, the Executive may engage in such other pursuits, including, without limitation, personal, legal and financial affairs, as shall not interfere or conflict with the proper performance of her duties hereunder.

		
	2.
	Compensation.

		
	2.1
	Base Salary.  The Executive shall receive a base salary at the annual rate of $190,000.  The base salary shall be payable in substantially equal installments consistent with the Company's normal payroll schedule, subject to applicable withholding and other taxes.  Base salary may be increased during the Employment Term but may not be decreased and 

the Board shall consider, on an annual basis, the nature, extent and advisability, if any, of an increase in the Executive's base salary.

		
	2.2
	Additional Cash Compensation.  During Executive's employment, Executive shall be eligible to receive annual bonuses which, in the discretion of the Board, are payable to executive management.  Annual bonuses will be based on achievement against goals established for the senior executive officer group including Executive by the Board in consultation with the Executive.

		
	2.3
	Restricted Stock Grant.  After ninety (90) days from the Effective Date of this Agreement, the Company shall negotiate and enter into a Restricted Stock Agreement (“RSA”) with Executive to issue shares of restricted common stock no later than one hundred eighty (180) days from the Effective Date of this Agreement.  The number of shares issued under the RSA will be at the discretion of the Company, but shall have a fair value of no less than ten percent (10%) of the Executive's Base Salary at the date of issuance. The restricted stock shall vest at the conclusion of the one year anniversary of the RSA effective date.

		
	2.4
	Equity Incentive Compensation.  In addition to any compensation payable under Section 2.1, 2.2 and 2.3, the Executive shall also be eligible to participate in any future equity incentive compensation plans or directed share programs designed for members of the Company's Senior Management team approved by the CEO and Board of Directors so long as this agreement remains in effect.

		
	3.
	Other Benefits.

		
	3.1
	Expense Reimbursement.  During Executive's employment, the Company, upon the submission of supporting documentation by the Executive, and in accordance with Company policies for its executives, shall reimburse the Executive for all expenses actually paid or incurred by the Executive in the course of and pursuant to the business of the Company and the Subsidiaries, including expenses for travel and entertainment, for which the Executive shall have an expense allowance as set by the Board from time to time.  Expenses incurred by the Executive in connection with maintaining professional licenses and relevant technical job knowledge including, but not limited to, continuing education, professional fees, dues and subscriptions, shall be fully reimbursed without limitation.

		
	3.2
	Other Benefits.  During Executive's employment, Executive will be eligible to participate, on terms which are generally available to the other senior executives of the Company and subject to the eligibility requirements of the applicable Company plans as in effect from time to time, in the Company's, deferred compensation, medical, dental, vacation, life insurance and disability programs, and other benefits generally available to the Company's senior executives from time to time. 

		
	3.3
	Working Facilities.  During Executive's employment, the Company shall furnish the Executive with an office, and such other facilities and services suitable to her position and adequate for the performance of her duties hereunder.

		
	3.4
	Vacation.  During Executive's employment, Executive shall be entitled to reasonable vacations during each year of the Term, the time and duration thereof to be determined by mutual agreement between Executive and the Company.  Reasonable vacations shall be no less than four (4) weeks or twenty (20) business days, excluding holidays, each calendar year. 

		
	4.
	Termination.

		
	4.1
	Termination for Cause.  Notwithstanding anything contained in this Agreement to the contrary, this Agreement may be terminated at any time by the Company for Cause.  As used in this Agreement “Cause” shall only mean (i) any action or omission of the Executive which constitutes a material breach of this Agreement, (ii) willful failure to perform the duties assigned to the Executive by the CEO or the Board, from time to time; (iii) fraud, breach of fiduciary duty, embezzlement or misappropriation as against the Company, or (iv) the conviction (from which no appeal can be taken) of Executive for any criminal act which is a felony.  For purposes of this Paragraph 4.1, an act or failure to act shall be considered “willful” only if done or omitted to be done without a good faith reasonable belief that such act or failure to act was in the best interests of the Company.  With respect to clause (i) and (ii) above, the Company shall provide Executive written notice of the alleged violation and allow Executive ten (10) business days to cure the violation.  Any termination for Cause pursuant to this Paragraph 4.1 shall be made in writing to Executive, which notice shall set forth in detail all acts or omissions upon which the Company is relying for such termination. Upon any termination pursuant to this Paragraph 4.1, the Company shall pay to the Executive any unpaid Base Salary accrued through the Effective Date of termination specified in such notice. In addition, the Company shall pay any benefits, if any, owed to Executive under any plan 

provided for Executive under Paragraph 3 hereof in accordance with the terms of such plan as in effect on the date of termination of employment under this Paragraph 4.1, as well as any annual incentive bonuses pursuant to Paragraph 2.2 hereof earned but not yet paid for any completed full fiscal year immediately preceding the employment termination date.  Except as provided above, the Company shall have no further liability hereunder (other than for reimbursement for reasonable business expenses incurred prior to the date of termination, subject, however to the provisions of Paragraph 3.1 hereof).

		
	4.2
	Termination Due to Death or Disability.  In the event of the Executive's death, Executive's employment shall automatically cease and terminate as of the date of death. If Executive becomes Disabled, the Company may terminate Executive's employment upon thirty (30) days written notice to Executive. For purposes of this Agreement, the terms “Disabled” or “Disability” means Executive's inability, because of physical or mental illness or injury, substantially to perform her duties hereunder as a result of physical incapacity for a continuous period of at least six (6) months, to be determined no earlier than at the end of the six (6) month period. In the event of any dispute as to the Executive's incapacitation, the Board shall select a physician, and the Employee shall select a physician.  If the two physicians are unable to agree on whether Employee is Disabled for purposes of this Agreement, those two physicians shall select a third physician, whose determination shall be final and binding upon both the Executive and the Company. In the event of the termination of employment due to Executive's death or Disability, Executive or her estate or legal representatives shall be entitled to receive:

		
	(i)
	payment for all accrued but unpaid Base Salary as of the date of Executive's termination of employment;

		
	(ii)
	reimbursement for expenses incurred by the Executive pursuant to. Paragraph 3.1 hereof up to and including the date on which employment is terminated;

		
	(iii)
	any earned benefits to which the Executive may be entitled as of the date of termination pursuant to the terms of any compensation or benefit plans to the extent permitted by such plans (with the payments described in subsections (i) through (iii) above collectively called the “Accrued Payments”);

		
	(iv)
	any annual incentive bonuses earned but not yet paid for any completed full fiscal year immediately preceding the employment termination date;

		
	(v)
	if employment termination occurs prior to the end of any fiscal year, a pro rata annual incentive bonus for such fiscal year in which employment termination occurs (based on actual business days in such fiscal year prior to such employment termination, divided by the total annual business days) determined and paid based on actual performance achieved for that fiscal year against the prorated performance goals for that fiscal year;

		
	(vi)
	in the case of death of Executive, the Company shall continue in force all benefits applicable to Executive's family for six (6) months.

		
	(vii)
	Any payments under this paragraph shall be made on or before March 15th of the year following Executive's death or Disability (with the exception of Base Salary and reimbursement of expenses, which shall be paid no later than the pay period immediately following termination of employment).

		
	4.3
	Termination Without Cause.  Either party may terminate Executive's employment hereunder without Cause at any time by providing one-hundred eighty (180) days written notice of such termination.  In the event of the termination of Executive's employment under this Paragraph 4.3 without Cause by the Company, then Executive shall be entitled to:

		
	(i)
	payment of the Accrued Payments in full within the next normal payroll period following Termination;

		
	(ii)
	any annual incentive bonuses earned but not yet paid for any completed full fiscal year immediately preceding the employment termination date, to be paid in full within the next normal payroll period following Termination;

		
	(iii)
	if employment termination occurs prior to the end of any fiscal year, the annual incentive bonus for such fiscal year in which employment termination occurs for which Executive would have been entitled if employed at the conclusion of the fiscal year determined and paid based on actual performance achieved for such fiscal year against the prorated performance goals for that fiscal year, to be paid in full within ninety days following completion of the fiscal year;  

		
	(iv)
	the Company shall arrange for the Executive to continue to participate (through COBRA or otherwise), on substantially the same terms and conditions as in effect for the Executive (including any required contribution) immediately prior to such termination, in the medical, dental, disability and life insurance programs provided to the Executive hereof until the earlier of (a) a one-hundred eighty (180) day period from the effective date of termination; or (b) such time as the Executive is eligible to be covered by comparable benefit(s) of a subsequent employer (determined on a benefit-by-benefit and coverage-by-coverage basis).  The foregoing is referred to as “Benefits Continuation”. The Executive agrees to notify the Company promptly if and when she begins employment with another employer and if and when she becomes eligible to participate in any benefit or other welfare plans, programs or arrangements of another employer.

In the event of the termination of Executive's employment under this Paragraph 4.3 without Cause by the Executive, then Executive shall be entitled to items listed above in subparagraphs (i), (ii) and (iii) above only.  The Company shall have no further liability hereunder (other than for reimbursement for reasonable business expenses incurred prior to the date of termination, subject, however to the provisions of Paragraph 3.1 hereof).

		
	4.4
	Specified Employee.  Notwithstanding anything to the contrary in this Agreement, if at the time of Executive's termination of employment Executive is a “specified employee,” as defined below, any and all amounts payable to Executive on account of such separation from service that would be nonqualified deferred compensation and would (but for this provision) be payable within six (6) months following the date of termination, shall instead be paid in a single sum on the next regular payday following the expiration of such six (6) month period or, if earlier, the date of Executive's death; except (A) to the extent of amounts that do not constitute a deferral of compensation within the meaning of Treasury regulation Section 1.409A-1(b), as determined by the Company in its discretion; (B) benefits which qualify as excepted welfare benefits pursuant to Treasury regulation Section 1.409A-1(a)(5); or (C) other amounts or benefits that are not subject to the requirements of Section 409A, shall not be subject to any such acceleration.  

		
	4.5
	Separation from Service.  For purposes of this Agreement, all references to “termination of employment” and correlative phrases shall be construed to require a “separation from service” (as defined in Section 1.409A-1 (h) of the Treasury regulations after giving effect to the presumptions contained therein), and the term “specified employee” means an individual determined by the Company to be a specified employee under Treasury regulation Section 1.409A-1(i).  

		
	4.6
	409A Compliance.  Payments under this Agreement are intended either to be exempt from the rules of Section 409A or to satisfy those rules, and the Agreement shall be construed accordingly.

		
	4.7
	Release of Claims as Condition.  The Company's obligation to pay to the Executive the benefits described in paragraphs 4.1, 4.2 and 4.3 of this Agreement shall be conditioned upon the Executive, or her legal representative as appropriate, having delivered to the Company an executed full and unconditional release (that is not subject to revocation) of claims against the Company, its parent entities, affiliates, employee benefit plans and fiduciaries, officers, employees, directors, agents and representatives satisfactory in form and content to the Company's counsel.

		
	4.8
	No Mitigation.  In no event shall Executive be obligated to seek other employment or take any other action by way of mitigation of the amounts payable to Executive under any of the provisions of this Agreement, nor shall the amount of any payment hereunder be reduced by any compensation earned by Executive as a result of subsequent employment unless otherwise provided herein.

		
	5.
	Restrictive Covenants.

		
	5.1.
	Confidentiality/Non-Disclosure.  “Confidential Information” shall mean any intellectual property, information, or trade secrets (whether or not specifically labeled or identified as “confidential” or “private”), in any form or medium, that is disclosed to, or developed or learned by, the Executive, and that relates to the business plan, underwriting, products, services, research, or development of or by the Company or its Subsidiaries, suppliers, distributors, customers, investors, partners, and/or other business associates, and that has not become publicly known.  Confidential Information includes, but is not limited to, the following:

		
	1.
	Internal business information (including but not limited to information relating to strategy, staffing, financial data, training, marketing, promotional and sales plans and practices, costs, bidding activities and strategies, rate and pricing structures, and accounting and business methods);

		
	2.
	Identities of, negotiations with, individual requirements of, specific contractual arrangements with, and information about, the Company's or its Subsidiaries' suppliers, distributors, customers, investors, partners and/or other business associates, their contact information, and their confidential information;

		
	3.
	Compilations of data and analyses, underwriting process and parameters, material processes, technical data, specific program information, trade or industrial practices, computer programs, formulae, systems, research, records, reports, manuals, documentation, customer and supplier lists, data and databases relating thereto, and technology and methodology regarding specific projects; and

		
	4.
	Intellectual Property not generally available to the public, or published by the Company or its Subsidiaries.

Confidential Information shall not include information that:  (i) is or becomes public information without breach of this Agreement by Executive; (ii) was in Executive's possession (in writing or other recorded form) prior to her employment by the Company with no obligation to maintain confidentiality, as evidenced by written or electronic records; (iii) was received from a third party not under any obligation of confidentiality to the Company; or (iv) is required to be disclosed by Executive by law or a final order of a court or other governmental agency or authority of competent jurisdiction (collectively, “Order”); provided, however, reasonable notice prior to any such disclosure shall be given to the Company to allow sufficient time for the Company to obtain injunctive relief, a protective order or similar remedy.

“Intellectual Property," or “IP,” shall mean (1) inventions or devices, whether patentable or not; (2) original works of authorship produced by or on behalf of the Company or its Subsidiaries; (3) trade secrets; (4) know-how; and (5) any other intangible property protectable under federal, state or foreign law.  Other examples of Intellectual Property include, but are not limited to, patent applications, patents, copyrighted works, technical data, computer software, knowledge of suppliers or business partnerships, documentation, processes, and methods and results of research.  

The Executive acknowledges and agrees with the representations of the Company that Confidential Information and IP is proprietary and valuable to the Company, and that any disclosure or unauthorized use thereof may cause irreparable harm and loss to the Company.  

The Executive acknowledges and agrees that (1) the nature and periods of restrictions imposed by the covenants contained in this Agreement are fair, reasonable and necessary to protect and preserve for the Company and its Subsidiaries their viability and future revenues; (b) the Company or its Subsidiaries would sustain great and irreparable loss and damage if the Executive were to breach any of such covenants set forth herein; (c) the Company and its Subsidiaries intend to conduct business actively in the entire territory that is the subject of this Agreement (as defined below) and beyond; and (d) the covenants herein set forth are made as an inducement to and have been relied upon by the Company in entering into this Agreement.

The Executive acknowledges and agrees this Agreement is binding on the Executive's heirs, executors, successors, administrators, representatives and agents.

The Executive agrees to receive and to treat Confidential Information and the knowledge of IP on a confidential and restricted basis and to undertake the following additional obligation with respect thereto:

		
	1.
	To use the Confidential Information for the singular purpose of benefiting the Company and its Subsidiaries, and specifically not use the Company's and its Subsidiaries' customer or prospective customer data to conduct marketing, or otherwise undertake personal contacts, to solicit, divert or appropriate customers or prospective customers of the Company or its Subsidiaries, whether for the benefit of the Executive or any Person; 

		
	2.
	Not to disclose Confidential Information, except to the extent the Executive is required to disclose or use such Confidential Information in the performance of the Executive's assigned duties for the Company or its Subsidiaries, to any Person without the prior express written consent of the Board of the Company, or their successors as an action permitted under the operating agreement of the Company;

 
		
	3.
	 To tender all Confidential Information to the Company, and destroy any of the Executive's additional notes or records made from such Confidential Information, immediately upon request by the Company or upon termination of this Agreement; 

		
	4.
	To promptly disclose and assign any right, title and interest to the Company all IP authored, made, conceived or actually reduced to practice, alone or jointly with others, (a) while performing duties for the Company or its 

Subsidiaries, or (b) during Executive's employment under this Agreement (if such IP is related to the Company's area of business), or (c) which results or is suggested by any work done for or at the request of the Company or its Subsidiaries, or (d) which was aided by the use of trade secret information, whether or not during working hours and regardless of location;

		
	5.
	To use best efforts to safeguard the Confidential Information and protect it against disclosure, misuse, espionage, loss, misappropriation and theft;

		
	6.
	Immediately notify the Board of any breach of this Agreement; and

		
	7.
	Assist the Company or its Subsidiaries, both during and after the termination of this Agreement, in obtaining and enforcing any legal rights in IP of the Company or its Subsidiaries, or assigned or to be assigned by the Executive to the Company or its Subsidiaries.

		
	5.2.
	Non-Solicitation.  The Executive covenants and agrees with the Company that the Executive will not, directly or indirectly, for any Person, through the period ending on the second (2nd) annual anniversary of the last day of the Executive's employment with the Company attempt to employ, divert away an employee, or enter into any contractual arrangement with any employee or former employee, of the Company or its Subsidiaries, unless such employee or former employee has not been employed by the Company or its Subsidiaries for a period in excess of one (1) year.  This Section shall not apply to former employees that were terminated by the Company.

		
	5.3.
	Consent to Injunction.  The Executive acknowledges that any breach of a covenant contained in Paragraph 5 of this Agreement will result in irreparable injury to the Company or its Subsidiaries and that the Company's or its Subsidiaries' remedy at law for such a breach may be inadequate and will be extremely difficult to calculate or determine. Accordingly, the Executive agrees and consents that upon any such breach, the Company or its Subsidiaries shall, in addition to all other remedies available at law and in equity, be entitled to (A) both preliminary and permanent injunctions to prevent or halt any such breach or threatened breach, and (B) recover the cost of such attorney's fees as the Company or its Subsidiaries may incur to enforce it rights hereunder if the Company is a prevailing party in such litigation.  Further, the Executive agrees that in the event of any breach hereunder, the Company or its Subsidiaries shall have the right to seek restraining orders and/or injunctions. 

		
	5.4.
	Severability.  In the event that the provisions of this Agreement should ever be deemed to exceed the time or geographic limitations permitted by applicable law, then the provisions will be reformed to the maximum time or geographic limitations permitted by applicable law.  Every provision of this Agreement is intended to be severable, and, if any term or provision is determined to be illegal, invalid or unenforceable for any reason whatsoever, and cannot be reformed, such illegal, invalid or unenforceable provision shall be deemed severed herefrom and shall not affect the validity, legality or enforceability of the remainder of this Agreement.  

Books and Records. All books, records, accounts and similar repositories of Confidential Information of the Company and its Subsidiaries, whether prepared by the Executive or otherwise coming into the Executive's possession, shall be the exclusive property of the Company and shall be returned immediately to the Company and its Subsidiaries on termination of this Agreement or on the Board's request at any time.

		
	6.
	Consolidation, Merger or Sale of Assets.  Nothing in this Agreement shall preclude the Company from consolidating or merging into or with, or transferring all or substantially all of its assets to, another corporation which assumes this Agreement, and all obligations of the Company hereunder, in writing. Upon such consolidation, merger, or transfer of assets and assumption, the term "the Company" as used herein, shall mean such other corporation and this Agreement shall continue in full force and effect, subject to the provisions of Paragraph 6 hereof. 

		
	7.
	Indemnification.  The Company agrees that the Executive shall be covered and insured up to the full limits provided by all directors' and officers' insurance which the Company then maintains to indemnify its directors and officers (and to indemnify the Company for any obligations which it incurs as a result of its undertaking to indemnify its officers and directors), subject to applicable deductibles and to the terms and conditions of such policies as well as provided under any policy of indemnification then in effect for the Company.

		
	8.
	Enforceability.  It is the intention of the parties that the provisions of this Agreement shall be enforced to the fullest extent permissible under the laws and public policies of each state and jurisdiction in which such enforcement is sought, but that the unenforceability (or the modification to conform with such laws or public policies) of any provisions hereof, shall not render unenforceable or impair the remainder of this Agreement. Accordingly, if any provision of this Agreement shall be determined 

to be invalid or unenforceable, either in whole or in part, this Agreement shall be deemed amended to delete or modify, as necessary, the offending provisions and to alter the balance of this Agreement in order to render the same valid and enforceable to the fullest extent permissible.

		
	9.
	Assignment.  This Agreement is personal in nature to the Company and the rights and obligations of the Executive under this Agreement shall not be assigned or transferred by the Executive. This Agreement and all of the provisions hereof shall be binding upon, and inure to the benefit of, the parties hereto and their successors (including successors by merger, consolidation, sale or similar transaction, permitted assigns, executors, administrators, personal representatives, heirs and distributees).

		
	10.
	Amendment.  This Agreement may not be amended, supplemented or modified in whole or in part except by an instrument in writing signed by the party or parties against whom enforcement of any such amendment, supplement or modification is sought.

		
	11.
	Survival.  Anything hereof to the contrary notwithstanding, the provisions of Paragraphs 2 through 18 shall survive the expiration or termination of this Agreement, regardless of the reasons therefor.

		
	12.
	Choice of Law. This Agreement will be interpreted, construed and enforced in accordance with the laws of the State of Florida, without giving effect to the application of the principles pertaining to conflicts of laws.

		
	13.
	Effect of Waiver. The failure of any party at any time or times to require performance of any provision of this Agreement will in no manner affect the right to enforce the same. The waiver by any party of any breach of any provision of this Agreement will not be construed to be a waiver by any such party of any succeeding breach of that provision or a waiver by such party of any breach of any other provision.

		
	14.
	Construction. The parties hereto and their respective legal counsel participated in the preparation of this Agreement; therefore, this Agreement shall be construed neither against nor in favor of any of the parties hereto, but rather in accordance with the fair meaning thereof.

		
	15.
	Enforcement.  Should it become necessary for any party to institute legal action to enforce the terms and conditions of this Agreement, the prevailing party will be awarded reasonable attorneys' fees at all trial and appellate levels, expenses and costs. Any suit, action or proceeding with respect to this Agreement shall be brought in the courts of the State of Florida within the County which the Company maintains its primary offices or in the U.S. District Court of Florida for the district in which the Company maintains its primary offices, whichever is applicable. The parties hereto hereby accept the exclusive jurisdiction of those courts for the purpose of any such suit, action or proceeding.

Notwithstanding the foregoing provisions of this Paragraph, each of the parties agrees that, prior to commencing litigation under this Agreement, the parties agree to submit, for a period of sixty (60) days, to voluntary mediation before a jointly selected neutral third party mediator under the auspices of JAMS, Atlanta, GA Resolutions Center (or any successor location) or a mutually agreed upon certified mediator in Tampa, FL, pursuant to the procedures of JAMS International Mediation rules or the Florida Rules for Certified and Court-Appointed Mediators, to be conducted in the State of Florida, Hillsborough County (however, such mediation or obligation to mediate shall not suspend or otherwise delay any termination or other action of the parties or affect the parties' other rights).

The parties hereto acknowledge and agree that any party's remedy at law for a breach or threatened breach of any of the provisions of this Agreement would be inadequate and such breach or threatened breach shall be per se deemed as causing irreparable harm to such party. Therefore, in the event of such breach or threatened breach, the parties hereto agree that, in addition to any available remedy at law, including but not limited to monetary damages, an aggrieved party, without posting any bond, shall be entitled to obtain, and the offending party agrees not to oppose the aggrieved party's request for, equitable relief in the form of specific enforcement, temporary restraining order, temporary or permanent injunction, or any other equitable remedy that may then be available to the aggrieved party.

		
	16.
	Counterparts.  This Agreement may be executed in one or more counterparts, each of which will be deemed an original.

		
	17.
	Notice.  Any notice required or permitted to be delivered hereunder shall be deemed to be delivered when sent by facsimile with receipt confirmed or when deposited in the United States mail, postage prepaid, registered or certified mail, return receipt requested, or by overnight courier, addressed to the parties at the address first stated herein, or to such other address as either party hereto shall from time to time designate to the other party by notice in writing as provided herein.

		
	18.
	Entire Agreement.  This Agreement contains the entire agreement and understanding between the parties with respect to the subject matter hereof and supersedes any prior or contemporaneous understandings and agreements, written or oral, between and among them respecting such subject matter, including, without limitation, the Term Sheet.

		
	19.
	Expenses. Reasonable legal fees and expenses up to a maximum total of $1500 incurred by the Executive in negotiating and entering into this Agreement will be paid by the Company. All such fees and expenses will be paid by the Company within 30 days after the Company's receipt of the invoices therefor.

IN WITNESS WHEREOF, this Agreement has been duly signed by the parties hereto on the day and year first above written.
UNITED INSURANCE HOLDINGS CORP.
By:    ____________________________________
Name:    ____________________________________
Title:    ____________________________________
EXECUTIVE
__________________________________    
Kimberly Salmon

Notary AcknowledgmentGPK Exhibit 10.36 - MSA Perot Amendment #1

First Amendment
to
Master Services Agreement

The Master Services Agreement dated as of November 29, 2007 (“GPI Agreement”), by and between Graphic Packaging International, Inc., (“GPI”), and Perot Systems Corporation (“Perot Systems”) is hereby amended as of September 22, 2008 (“Amendment Date”) by this First Amendment (“Amendment”).

Whereas, Altivity Packaging, LLC (“Altivity”), and Perot Systems entered into a Master Information Technology Services Agreement as of January 1, 2007 (the “Altivity Agreement”); 

Whereas, GPI acquired Altivity as of March 10, 2008; 

Whereas, under Section 11.1(c)(ii) of the GPI Agreement, Altivity is the “Target Entity,” GPI has elected “to combine the Designated Services then provided to GPI and the Service Recipients pursuant to this Agreement with the services then provided to the Target Entity and its Affiliates pursuant to their agreement with Perot Systems”, and GPI has further elected to require Perot Systems to permit Altivity to terminate the Altivity Agreement without obligation to pay any Termination Fee or similar fee or charge to Perot Systems; 

Whereas, GPI represents that it has the authority to act for Altivity under the Altivity Agreement; and

Whereas Perot Systems and GPI (the “Parties”) wish to enter into this Amendment to document the termination of the Altivity Agreement and the combination of the services being provided to Altivity with the Designated Services being provided to GPI.

Now, therefore, the Parties agree as follows:

		
	1.
	Subject to the terms of this Amendment, the Altivity Agreement is hereby terminated as of the Amendment Date by mutual agreement of the Parties.  

		
	2.
	Data that were “Altivity Data” under Section 7.1 of the Altivity Agreement shall be deemed GPI Data.  

		
	3.
	Information that was “Confidential Information” of Altivity or Perot Systems under Section 10.1 of the Altivity Agreement, subject to the exceptions defined in Section 10.3

(a) of the Altivity Agreement, shall be Confidential Information of GPI or Perot Systems, respectively, under the GPI Agreement.  

		
	4.
	Subject to Section 5 of this Amendment, “Charges” as defined in and incurred under the Altivity Agreement before the Amendment Date and not previously paid by Altivity shall be deemed “Charges” payable by GPI under the GPI Agreement; provided that GPI shall retain the right to dispute any such amounts in accordance with Section 4.3 (Disputed Invoices) of the GPI Agreement.

		
	5.
	The modified charges payable by GPI under the GPI Agreement as a result of the consummation of the transactions contemplated by this Amendment shall apply beginning September 1, 2008.  Accordingly, any Monthly Base Charges (as defined in the Altivity Agreement) previously invoiced by Perot Systems under the Altivity Agreement for the month of September 2008 and any Monthly Service Charges (as defined in the GPI Agreement) previously invoiced by Perot Systems under the GPI Agreement for the month of September 2008 shall be deemed void, and shall be superseded by a single Monthly Service Charge calculated in accordance with the revised Schedule 4.1 (Charges) attached hereto and reflected in a new Monthly Invoice to be issued by Perot Systems to GPI promptly after the Amendment Date, which Monthly Invoice shall thereafter be payable by GPI in accordance with Section 4.2 (Invoicing and Payment) of the GPI Agreement.  Notwithstanding the foregoing, portions of outstanding invoices delivered by Perot Systems prior to the Amendment Date to Altivity under the Altivity Agreement and to GPI under the GPI Agreement that represent charges and credits with respect to services performed during periods prior to September 1, 2008 shall remain payable in accordance with the terms of the Altivity Agreement and GPI Agreement, respectively.

		
	6.
	The Service Levels under the GPI Agreement as a result of the consummation of the transactions contemplated by this Amendment shall apply (including, without limitation, for purposes of determining the accrual of Service Level Credits and reporting obligations) beginning on the effective dates specified in Attachment A to Schedule 2.10 (Service Level Agreement) to the GPI Agreement, as amended by this Amendment (the “SLA Effective Dates”).  Service Levels with SLA Effective Dates later than September 1, 2008 (collectively, the “Combined Scope Service Levels”) represent combinations of Service Levels in effect prior to the Amendment Date under the Altivity Agreement and under the GPI Agreement (collectively, the “Legacy Service Levels”).  From September 1, 2008 until such time as each Combined Scope Service Level takes effect on its SLA Effective Date, the Legacy Service Levels combined to create such Combined Scope Service Level will continue to apply; provided that, in the event during such period there 

occurs a Service Level Failure (as defined in the GPI Agreement) or Service Level Default (as defined in the Altivity Agreement) of any such Legacy Service Level, the amount of the resulting Service Level Credit (as defined in the GPI Agreement) will equal 50% of the Service Level Credit that would have accrued in the event of a Service Level Failure of the Combined Scope Service Level into which such Legacy Service Level is to be combined, as determined in accordance with Schedule 2.10 of the GPI Agreement, as amended.  In revising Attachment A to Schedule 2.10 (Service Level Agreement) of the GPI Agreement to reflect the terms of this Amendment, the Parties have removed the “Current State Service Levels” from Attachment A.  Notwithstanding, the Parties acknowledge and agree that the Current State Service Levels (as set forth in Attachment A prior to its amendment) were applicable prior to completion of Transition in accordance with Schedule 2.10 (Service Level Agreement) of the GPI Agreement.

		
	7.
	The following amendments are hereby made to Section 5.2 (Charges Renegotiation) of the Agreement:

		
	a.
	The following sentence is hereby added to the end of Section 5.2(a) (Underutilization of Resource Units) of the Agreement:  “With respect to RS6000 Server Services such renegotiation right will be triggered when the consumption for all types of RS6000 LPARs is less than sixty-five percent (65%) of the cumulative Baselines for all types of RS6000 LPARs for three (3) consecutive months or for five (5) months in any seven (7) month period, and such reduced resource utilization is anticipated by GPI to continue on a long term basis.”

		
	b.
	The following sentence is hereby added to the end of Section 5.2(b) (Excess Utilization of Resource Units) of the Agreement:  “With respect to RS6000 Server Services such renegotiation right will be triggered when the consumption for all types of RS6000 LPARs is greater than 135% of the cumulative Baselines for all types of RS6000 LPARs for three (3) consecutive months or for five (5) months in any seven (7) month period, and such excess resource utilization is anticipated by GPI to continue on a long term basis.”

		
	8.
	Subject to the terms of this Amendment, only the following sections of the Altivity Agreement shall survive its termination, and only as to rights and obligations arising out of acts, omissions, conditions or events occurring or existing before the Amendment Date, with GPI succeeding to Altivity’s rights and obligations under such sections:  

		
	a.
	3.14 (Compliance with Laws),

		
	b.
	4.11 (Government Contract Flow-Down Clauses),

		
	c.
	5.5 (Audit Rights) excluding 5.5(b) and, as to operational audits only, 5.5(d) (provided that the Parties acknowledge and agree that GPI’s right to conduct operational audits pursuant to Section 14.1 of the GPI Agreement shall include operational audits pertaining to Altivity, including operational audits related to acts, omissions, conditions or events occurring or existing before the Amendment Date),

		
	d.
	7 (Altivity Data),

		
	e.
	8.1 (Altivity Owned Materials), 

		
	f.
	8.2 (Ownership of Developed Materials), 

		
	g.
	8.4 (License to Service Provider), 

		
	h.
	8.5 (Service Provider Pre-Existing Materials),

		
	i.
	10.1 (Confidential Information),

		
	j.
	10.2 (Obligations),

		
	k.
	10.3 (Exceptions to Confidential Treatment),

		
	l.
	11 (Representations and Warranties), except that any warranty under 11.7 shall not extend beyond the Amendment Date,

		
	m.
	13.1 (Indemnity by Service Provider), 

		
	n.
	13.2 (Indemnity by Altivity), 

		
	o.
	13.3 (Additional Indemnities), 

		
	p.
	13.4 (Infringement),

		
	q.
	Article 14 (Sections 14.1-14.7) (Liability); 

		
	r.
	16.1 (Force Majeure),  

		
	s.
	18.6 (Relationship of the Parties),

		
	t.
	18.11 (Severability), 

		
	u.
	18.12 (Order of Precedence), 

		
	v.
	18.13 (Waiver of Default; Cumulative Remedies), 

		
	w.
	18.14 (Third Party Beneficiaries), 

		
	x.
	18.19 (Binding Nature and Assignment), 

		
	y.
	18.21 (Entire Agreement), and 

		
	z.
	18.23 (Covenant of Good Faith).

Without limiting the foregoing, the termination of the Altivity Agreement shall not constitute a waiver or termination of (i) any rights of Altivity (and GPI as successor thereto) arising out of a breach by Perot Systems of any term of the Altivity Agreement prior to the Amendment Date, or (ii) any rights of Perot Systems arising out of a breach by Altivity of any term of the Altivity Agreement prior to the Amendment Date.

		
	9.
	From and after the Amendment Date, (i) “Altivity Owned Materials” existing under and as defined in the Altivity Agreement shall be deemed to be “GPI Software” and/or “GPI 

Tools,” as applicable,  under and as defined in the GPI Agreement; (ii) “Service Provider Owned Materials” existing under and as defined in the Altivity Agreement shall be deemed to be “Perot Systems Software” and/or “Perot Systems Tools,” as applicable,  under and as defined in the GPI Agreement; and (iii) “Developed Materials” created or prepared by Perot Systems under and as defined in the Altivity Agreement (whether completed or under development at the Amendment Date) shall, subject to Section 8.2 (b&c) of the Altivity Agreement, be deemed to be “Deliverables” under and as defined in the GPI Agreement and all Intellectual Property Rights (as defined in the GPI Agreement) therein shall be owned by GPI in accordance with the GPI Agreement.

		
	10.
	The terms and conditions relating to “Transitioned Employees” (as defined in the Altivity Agreement) in Section 4.6 (Training/Career Opportunities), Section 13.1(k) (Employment Claims) and Section 13.2(h) (Employment Matters) of the Altivity Agreement and in Sections 2(b) (Benefit Plans), 4 (Employment Status with Altivity), and 6 (Other Employee Matters) of Schedule 5 to the Altivity Agreement, shall survive the termination of the Altivity Agreement with GPI succeeding Altivity as to Altivity’s rights and obligations with respect to such terms and conditions.

		
	11.
	Any Projects that are being performed pursuant to the Altivity Agreement as of the Amendment Date shall continue to be performed by Perot Systems in accordance with the applicable Statement of Work or Project Plans under which such Projects were commissioned.

		
	12.
	For purposes of calculating the Damages Limitation defined in the first sentence of Section 18.2(a) of the GPI Agreement during the first twelve months after the Amendment Date, “Charges” as defined in the GPI Agreement shall be calculated so as to include the total “Charges” as defined in the Altivity Agreement that were payable to Perot Systems for performance of the Services under the Altivity Agreement (exclusive of Out-of-Pocket Expenses, Pass-Through Expenses, cost-plus Charges or taxes as those terms are defined in the Altivity Agreement) for the period between (i) twelve months prior to the assertion of the claim and (ii) the Amendment Date.

		
	13.
	Any disputes that arise under the Altivity Agreement after the Amendment Date relating to periods prior thereto shall be administered in accordance with the Dispute Resolution Procedures in the GPI Agreement.  Any indemnity proceedings arising under the terms of the Altivity Agreement after the Amendment Date relating to periods prior thereto shall be administered in accordance with the indemnification procedures set forth in Section 17.3 (Indemnification Procedures) of the GPI Agreement.  

		
	14.
	Schedule A is amended by adding the following sentence to the definition of “Operational Change Control Procedures”:

“Operational Change Control is sometimes referred to as Change Management.”

		
	15.
	Section 15.11(b) of the GPI Agreement is amended, by adding the phrase “the amount set forth in Schedule 15.11(b) for the month in which the effective date of termination occurs,” to state as follows:

		
	“(b)
	Notwithstanding anything to the contrary in this Agreement, regardless of the grounds for any termination, GPI shall pay Perot Systems for all Charges payable by GPI arising prior to the effective date of termination, any accrued and unpaid Transition Fees applicable to Transition tasks completed by Perot Systems prior to the effective date of termination, any Charges for Termination Assistance (which could include payment for Designated Services), the amount set forth in Schedule 15.11(b) for the month in which the effective date of termination occurs, and any expenses incurred by Perot Systems prior to the effective date of termination for which GPI is financially responsible under this Agreement, and GPI will continue to be responsible for all Taxes for which it is responsible under this Agreement.”  

		
	16.
	Section 8.3(a)(i) of the GPI Agreement is amended by adding the following after the end of the second sentence:

“This refresh obligation does not apply to the following GPI Equipment which prior to the Amendment Date was Altivity Equipment:  mainframe hardware; AS400 hardware; Wintel Type 7, 8, and 9 servers; network equipment for locations listed in Schedule 10.2 in the worksheet with the tab entitled “GPI Locations (Former ALT)”; and one IBM DS8100.  The foregoing exceptions do not apply to 24 Wintel Type 8 Servers and two IBM DS8100s in service as of the  Amendment Date, which the Parties acknowledge were GPI Equipment prior to the Amendment Date.”

		
	17.
	The following Schedules and Attachments of the GPI Agreement are amended and restated, or added, as of the Amendment Date and, as so amended and restated or added, are attached hereto and made part hereof:  

1.1(a), Service Recipients; 
2.1.1, Service Towers;
2.2(a), Statement of Work; 
2.8(b), Managed Agreements;

2.10, Service Level Agreement (Attachments only); 
2.13, Reports (provided that, during the 30-day period after the Amendment Date, the Parties will review and validate the version of Schedule 2.13 attached hereto and may further amend such version by agreement);
4.1, Charges (including Attachments A, B & D-H) (E-H are added); 
8.2, Financial Responsibilities Matrix; 
9.2(a)(i)(A), Key and Critical Personnel;
9.2(a)(i)(B), GPI Competitors;
10.2, Service Locations (Attachments only);
15.11(b), Unamortized Costs (added as new Schedule); and 
19.1, Insurance.

In addition, the Parties intend to revise Schedule 4.2(b), Invoices, by mutual agreement within 30 days after the Amendment Date.  Further, during the 60-day period after the Amendment Date, Perot Systems will develop supplements to the Procedures Manual that describe, at a reasonable level of detail, release management and records retention procedures; provided, that, in the case of the supplement pertaining to records retention, GPI will make available to Perot Systems sufficient information regarding GPI’s record retention policies and confer with Perot Systems as reasonably requested regarding the interpretation of such policies and their application to the Designated Services.

IN WITNESS WHEREOF, the Parties have duly executed and delivered this First Amendment as of the Amendment Date.

GRAPHIC PACKAGING INTERNATIONAL, INC. 
By:          /s/ Stephen A. Hellrung    
Name:  Stephen A. Hellrung    
Title:  SVP, General Counsel and Secretary    

PEROT SYSTEMS CORPORATION

By:            /s/ Charles S. Martel    
Name:  Charles S. Martel    
Title:  Client Executive

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