Document:

FPIC Non-Qualified Deferred Comp Plan dated 1/1/2005

    Exhibit
      10.1

    

    

    

    

    

    

    

    

    

    

    

    

    

     

    FPIC
      INSURANCE GROUP, INC.

    DEFERRED
      COMPENSATION PLAN

    

    AS
      AMENDED AND RESTATED, EFFECTIVE JANUARY 1, 2005

     

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    

    
      
        
          

           

        

        
        

      

      
        
        

        
        

      

      
        FPIC
          Insurance Group, Inc. 2005 Deferred Compensation Plan

        
        

      

    

    

    
      
        	
                ARTICLE
                  I

                Establishment
                  and Purpose

              	
                 

                1

              
	 	 
	
                ARTICLE
                  II

                Definitions 

              	
                 

                1

              
	 	 
	
                ARTICLE III

                Eligibility
                  and Participation

              	
                 

                8

              
	 	 
	
                ARTICLE IV

                Deferral
                  Elections

              	
                 

                9

              
	 	 
	
                ARTICLE V

                Modifications
                  to Payment Schedules

              	
                 

                12

              
	 	 
	
                ARTICLE VI

                Company
                  Contributions

              	
                 

                13

              
	 	 
	
                ARTICLE VII

                Valuation
                  of Account Balances; Investments

              	
                 

                14

              
	 	 
	
                ARTICLE VIII

                Distributions
                  and Withdrawals

              	
                 

                15

              
	 	 
	
                ARTICLE IX

                Administration

              	
                 

                18

              
	 	 
	
                ARTICLE X

                Amendment
                  and Termination

              	
                 

                20

              
	 	 
	
                ARTICLE XI

                Informal
                  Funding

              	
                 

                21

              
	 	 
	
                ARTICLE XII

                Claims

              	
                 

                22

              
	 	 
	
                ARTICLE XIII

                General
                  Conditions

              	
                 

                28

              

      

    

    

    
 

    
      
        
          

           

        

        
        

      

      
        
        

        
        

      

      
        
        

        FPIC
          Insurance Group, Inc. 2005 Deferred Compensation Plan

        
        

      

    

    ARTICLE
      I

    Establishment
      and Purpose

    

    FPIC
      Insurance Group, Inc. (the “Company”) maintains the FPIC Insurance Group, Inc.
      Deferred Compensation Plan, originally adopted effective November 1, 1994,
      as
      amended (the “Original Plan”). The Company hereby amends and restates the Plan
      effective as of January 1, 2005 (the “2005 Plan” or the “Plan”). The purpose of
      this amendment and restatement is to add certain plan features and to comply
      with requirements of Code Section 409A for all Accounts regardless of whether
      Deferrals occurred before or after January 1, 2005 (no “grandfathered”
Accounts). 

    

    The
      purpose of the Plan continues to be to attract and retain key employees by
      providing each Participant with an opportunity to defer receipt of a portion
      of
      their salary, bonus, and other specified compensation. The Plan is not intended
      to meet the qualification requirements of Code Section 401(a), but is intended
      to meet the requirements of Code Section 409A. The Plan is intended to be an
      unfunded arrangement for eligible employees who are part of a select group
      of
      management or highly compensated employees of the Company and its Affiliates
      (as
      defined below) within the meaning of Sections 201(2), 301(a)(3) and 401(a)(1)
      of
      ERISA.

    

    

    ARTICLE
      II

    Definitions

    

    
      	
              2.1

            	
              Account.
                Account means a bookkeeping account maintained by the Plan Administrator
                to record the Company’s payment obligation to a Participant as determined
                under the terms of the Plan. The Plan Administrator may maintain
                one or
                more Accounts to reflect amounts payable at different times and in
                different forms pursuant to the terms of a Participant’s Deferral
                Election. Reference to an Account means any such Account established
                by
                the Plan Administrator, as the context requires. Accounts are intended
                to
                constitute unfunded obligations of the Company within the meaning
                of
                Sections 201(2), 301(a)(3) and 401(a)(1) of
                ERISA.

            

    

    

    
      	
              2.2

            	
              Account
                Balance.
                Account Balance means, with respect to any Account, the total amount
                of
                the Company’s payment obligation from such Account as of the most recent
                Valuation Date.

            

    

    

    
      	
              2.3

            	
              Affiliate.
                Affiliate means a corporation, trade or business that, together with
                the
                Company, is treated as a single employer under Code Section 414(b)
                or (c).
                

            

    

    

    
      	
              2.4

            	
              Beneficiary.
                Beneficiary means a natural person, estate, or trust designated by
                a
                Participant on a Beneficiary Designation Form to receive payments
                to which
                a Beneficiary is entitled in accordance with provisions of the Plan,
                provided that the properly completed and signed Beneficiary Designation
                Form is received by the Plan Administrator prior to the Participant’s
                death. The Participant’s spouse, if living, otherwise the Participant’s
                estate, shall be the Beneficiary
                if:

            

    

    

    (i)
      the Participant has not designated a natural person or trust as Beneficiary,
      or

    
      
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        FPIC
          Insurance Group, Inc. 2005 Deferred Compensation
          Plan

      

    

    (ii)
      all designated Beneficiaries have predeceased the Participant.

    

    A
      former spouse shall have no interest under the Plan, as Beneficiary or
      otherwise, unless (i) the Participant designates such person as a Beneficiary
      after dissolution of the marriage or (ii) such interest is ordered under a
      domestic relations order described in Section 8.9.

    

    
      	
              2.5

            	
              Business
                Day.
                A Business Day is each day on which the New York Stock Exchange is
                open
                for business.

            

    

    

    
      	
              2.6

            	
              Change
                in Control.
                Change in Control means the earliest to occur of the following
                events:

            

    

    

    
      	 	
              (i)
                either (A) receipt by the Company of a report on Schedule 13D, or
                an
                amendment to such a report, filed with the Securities and Exchange
                Commission pursuant to Section 13(d) of the Securities Exchange Act
                of
                1934 (the "1934 Act"), disclosing that any person (as such term is
                used in
                Section 13(d) of the 1934 Act) ("Person"), is the beneficial owner,
                directly or indirectly, of twenty percent (20%) or more of the outstanding
                stock of the Company, or (B) actual knowledge by the Company of facts
                on
                the basis of which any Person is required to file such a report on
                Schedule 13D, or to file an amendment to such a report, with the
                SEC (or
                would be required to file such a report or amendment upon the lapse
                of the
                applicable period of time specified in Section 13(d) of the 1934
                Act)
                disclosing that such Person is the beneficial owner, directly or
                indirectly, of twenty percent (20%) or more of the outstanding stock
                of
                the Company;

            

    

    

    
      	 	
              (ii)
                purchase by any Person, other than the Company or an Affiliate of
                the
                Company directly or indirectly wholly-owned by the Company, of shares
                pursuant to a tender or exchange offer to acquire any stock of the
                Company
                (or securities convertible into stock) for cash, securities or any
                other
                consideration provided that, after consummation of the offer, such
                Person
                is the beneficial owner (as defined in Rule 13d-3 under the 1934
                Act
                regardless of whether the Company or such Person would otherwise
                be
                subject to the 1934 Act), directly or indirectly, of twenty percent
                (20%)
                or more of the outstanding stock of the Company (calculated as provided
                in
                paragraph (d) of Rule 13d-3 under the 1934 Act in the case of rights
                to
                acquire stock regardless of whether the Company or such Person would
                otherwise be subject to the 1934
                Act);

            

    

    

    
      	 	
              (iii)
                either (A) the filing, by any Person acquiring, directly or indirectly,
                twenty percent (20%) or more of the outstanding stock of the Company
                of a
                statement with the Florida Office of Insurance Regulation pursuant
                to
                Section 628.461 of the Florida Statutes or a successor statutory
                provision, or (B) actual knowledge by the Company of facts on the
                basis of
                which any Person acquiring, directly or indirectly, twenty percent
                (20%)
                or more of the outstanding stock of the Company or a controlling
                company
                is required to file such a statement pursuant to Section 628.461 of
                the Florida Statutes or a successor statutory
                provision;

            

    

    
      
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        FPIC
          Insurance Group, Inc. 2005 Deferred Compensation Plan

      

    

     

    
      
        	 	
                (iv)
                  approval by the shareholders of the Company of (A) any consolidation
                  or
                  merger of the Company in which the Company is not the continuing
                  or
                  surviving corporation or pursuant to which shares of stock of the
                  Company
                  would be converted into cash, securities or other property, other
                  than a
                  consolidation or merger of the Company in which holders of its
                  stock
                  immediately prior to the consolidation or merger have substantially
                  the
                  same proportionate ownership of common stock of the surviving corporation
                  immediately after the consolidation or merger as immediately before,
                  or
                  (B) any consolidation or merger in which the Company is the continuing
                  or
                  surviving corporation but in which the common shareholders of the
                  Company
                  immediately prior to the consolidation or merger do not hold at
                  least a
                  majority of the outstanding common stock of the continuing or surviving
                  corporation (except where such holders of common stock hold at
                  least a
                  majority of the common stock of the corporation that owns all of
                  the
                  common stock of the Company), or (C) any sale, lease, exchange
                  or other
                  transfer (in one transaction or a series of related transactions)
                  of all
                  or substantially all the assets of the Company, or (D) any merger
                  or
                  consolidation of the Company where, after the merger or consolidation,
                  one
                  Person owns 100% of the shares of stock of the Company (except
                  where the
                  holders of the Company's common stock immediately prior to such
                  merger or
                  consolidation own at least 90% of the outstanding stock of such
                  Person
                  immediately after such merger or consolidation);
                  

              

      

                                                                                                                                                                                                                                                                                                                                                                                                                                              
        

    

    
      	 	
              (v)
                a change in the majority of the members of the Board within a 24-month
                period unless the election or nomination for election by the Company's
                shareholders of each new director was approved by the vote of at
                least
                two-thirds (2/3) of the directors then still in office who were in
                office
                at the beginning of the 24-month period;
                or

            

    

    

    
      	 	
              (vi)
                in the case of Participant that is an employee of an Affiliate, completion
                of any transaction as a result of which such Affiliate ceases to
                be an
                Affiliate of the Company. 

            

    

    

    
      	
              2.7

            	
              Claimant.
                Claimant means a Participant or Beneficiary filing a claim under
                Article
                XII of this Plan.

            

    

    

    
      	
              2.8

            	
              Code.
                Code means the Internal Revenue Code of 1986, as amended from time
                to
                time. 

            

    

    

    
      	
              2.9

            	
              Code
                Section 409A.
                Code Section 409A means section 409A of the Code, and regulations
                and
                other guidance issued by the Treasury Department and Internal Revenue
                Service thereunder, as modified and replaced from time to time. Reference
                to proposed Treasury Department regulations shall be construed as
                reference to the corresponding provisions of the final Treasury Department
                regulations when said regulations are
                published.

            

    

     

    
      	
              2.10

            	
              Committee.
                Subject to the provisions of Section 9.2, Committee (or “Deferred
                Compensation Committee”) means at least three (3) officers of the Company
                selected by the Compensation Committee of the Board of Directors
                of the
                Company or by the Chief Executive Officer of the Company to administer
                the
                Plan.

            

    

    

    
      	
              2.11

            	
              Company.
                Company means FPIC Insurance Group,
                Inc.

            

    

    
      
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        FPIC
          Insurance Group, Inc. 2005 Deferred Compensation
          Plan

      

    

    
      
        	
                2.12

              	
                Company
                  Contribution.
                  Company Contribution means a credit by the Company to a Participant’s
                  Account(s) in accordance with the provisions of Article VI of the
                  Plan.
                  Company Contributions are credited at the sole discretion of the
                  Company
                  and the fact that a Company Contribution is credited in one year
                  shall not
                  obligate the Company or any of its Affiliates to continue to make
                  such
                  Company Contribution in subsequent
                  years.

              

      

    

    

    
      	
              2.13

            	
              Compensation.
                Compensation means a Participant’s base salary, bonus, commission, and
                directors’ and advisory board fees received from the Company or its
                Affiliates, and such other cash or equity-based compensation (if
                any)
                approved by the Plan Administrator, as Compensation that may be deferred
                under this Plan. Notwithstanding the above, unless approved by the
                Plan
                Administrator, Compensation shall not include any compensation that
                has
                been previously deferred under this Plan or any other arrangement
                subject
                to Code Section 409A; and shall not include the value of exercised
                stock
                options, vested stock awards, or interest accrued in any nonqualified
                plan.

            

    

    

    
      	
              2.14

            	
              Death
                Benefit.
                Death Benefit means payment to a Participant’s Beneficiary(ies) of all
                remaining unpaid Account Balances as provided in Section 8.3
                of the Plan.

            

    

    

    
      	
              2.15

            	
              Deferral.
                Deferral means the credits to a Participant’s Accounts attributable to
                deferrals of Compensation described in Prop. Treas. Reg. Section
                1.409A-1(b)(1) and Earnings on such amounts as provided in Prop.
                Treas.
                Reg. Section 1.409A-1(b)(2), except where the context of the Plan
                clearly
                indicates otherwise.

            

    

    

    
      	
              2.16

            	
              Deferral
                Election.
                Deferral Election means an agreement between a Participant and the
                Company
                specifying any or all of the following: (i) the amount of each component
                of Compensation subject to the Deferral Election; (ii) the investment
                allocation described in Section 7.2;
                and (iii) the Payment Schedule. The Plan Administrator may permit
                different deferral amounts for each component of Compensation and
                may
                establish a minimum or maximum deferral amount for each such component.
                Unless otherwise specified by the Plan Administrator in the Deferral
                Election agreement, Participants may defer up to 100% of their base
                salary
                and up to 100% of other types of Compensation for a Plan Year; provided,
                however, to the extent permissible under Code Section 409A, the Plan
                Administrator may reduce a Participant’s Deferral Election as necessary to
                permit sufficient non-deferred Compensation from which the Company
                may
                satisfy a Participant’s obligations and elections regarding welfare plans
                and qualified retirement plans and from which to satisfy tax withholding
                obligations, and/or to conform the Deferral Election and the Plan
                to
                applicable law. 

            

    

    

    
      	
              2.17

            	
              Director.
                Director means a member of the Board of Directors or the advisory
                board of
                the Company’s subsidiary, First Professionals Insurance Company,
                Inc.

            

    

    

    
      	
              2.18

            	
              Earnings.
                Earnings means an adjustment to the value of an Account in accordance
                with
                Article VII.

            

    

    

    
      
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        FPIC
          Insurance Group, Inc. 2005 Deferred Compensation
          Plan

      

    

    
      
        	
                2.19

              	
                Eligible
                  Employee.
                  Eligible Employee means a member of a “select group of management or
                  highly compensated employees” of the Company or any Affiliate selected in
                  writing by the Plan Administrator. 

              

      

       

    

    
      	
              2.20

            	
              Employee.
                Employee means a full-time salaried employee of the Company or any
                Affiliate.

            

    

    

    
      	
              2.21

            	
              ERISA.
                ERISA means the Employee Retirement Income Security Act of 1974,
                as
                amended from time to time.

            

    

    

    
      	
              2.22

            	
              Participant.
                Participant means an Eligible Employee or Director who satisfies
                Section
                3.1
                and any other person with an Account Balance greater than zero, regardless
                of whether such individual continues to be an Eligible Employee.
                A
                Participant’s continued participation in the Plan shall be governed by
                Section 3.2
                and Section 3.3
                of the Plan.

            

    

    

    
      	
              2.23

            	
              Payment
                Schedule.
                Payment Schedule means the date(s) as of which payment(s) under the
                Plan
                will commence and the form in which such payment(s) will be
                made.
                The following rules apply:

            

    

    

    
      	 	
              (a)

            	
              Specified
                Date Payments. Payment
                from each Specified Date Account will be made (or will commence)
                as of the
                first day of the month or year specified in the Participant’s Deferral
                Election. Unless a Participant properly elects an alternative form
                of
                payment in accordance with Articles IV and V, payment under this
                paragraph
                will be made in a single lump sum. Alternative forms of payment include
                a
                series of substantially equal annual installments payable over two
                (2) to
                five (5) years. For purposes of Articles IV and V, a series of installment
                payments will be treated as a single form of payment. All Specified
                Date
                Accounts that have not been paid as of the date of the Participant’s
                Separation from Service, death, or Change in Control will be paid
                as
                provided under (b) or (c) below.

            

    

    

    
      	 	
              (b)

            	
              Separation
                Benefit. Payment
                of a Participant’s entire remaining Account will be made, in accordance
                with the Participant’s proper election made in accordance with Articles IV
                and V, as a combination of (i) a lump sum payment between 0% and
                100% of
                the Account Balance, payable during the earlier of the January or
                July
                that is at least seven (7) months after the month in which the Participant
                Separates from Service, plus (ii) any remaining Account Balance payable
                in
                a series of substantially equal annual installments from two (2)
                to ten
                (10) years, beginning the first anniversary of the payment of the
                lump
                sum. Any combination lump sum plus installment payments elected by
                the
                Participant will be treated as a single form of payment for purposes
                of
                Articles IV and V. If a proper election has not been made by the
                Participant as described above, the lump sum payment shall equal
                100% of
                the Account Balance.

            

    

    

    
      
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        FPIC
          Insurance Group, Inc. 2005 Deferred Compensation
          Plan

      

    

    
      	 	
              (c)

            	
              Death
                Benefit. Payment
                to a Participant’s Beneficiary(ies) in the event of death shall be paid in
                a single lump sum, payable on the first day of the second month following
                the receipt by the Company of notice of the Participant’s
                death.

            

    

    

    
      	
              2.24

            	
              Performance-Based
                Compensation.
                Performance-Based Compensation means Compensation where the amount
                of, or
                entitlement to, the Compensation is contingent on the satisfaction
                of
                pre-established organizational or individual performance criteria
                relating
                to a performance period of at least twelve (12) consecutive months
                in
                which the Participant performs services for the Company. Organizational
                or
                individual performance criteria are considered pre-established if
                established in writing by not later than ninety (90) days after the
                commencement of the period of service to which the criteria relate,
                provided that the outcome is substantially uncertain at the time
                the
                criteria are established. Performance-Based Compensation may include
                payments based on performance criteria that are not approved by the
                Board
                of Directors or by the stockholders of the Company. Performance-Based
                Compensation does not include any amount or portion of any amount
                that
                will be paid either regardless of performance, or based upon a level
                of
                performance that is substantially certain to be met at the time the
                criteria is established. Performance criteria may be subjective but
                must
                relate to the performance of the Participant, a group of Employees
                that
                includes the Participant, the Company or an Affiliate, or a business
                unit
                (which may include the Company or an Affiliate) for which the Participant
                provides services. The determination that any subjective performance
                criteria have been met shall not be made by the Participant or by
                a family
                member of the Participant, or by a person under the supervision of
                the
                Participant or a Participant’s family members where any amount of the
                compensation of such person is controlled in whole or in part by
                the
                Participant or such family member. Compensation based on Company
                or
                Affiliate stock may constitute Performance-Based Compensation if
                it is
                based solely on an increase in the value of such stock after the
                date of
                grant or award. The determination of whether Compensation qualifies
                as
                “Performance-Based Compensation” will be made in accordance with Prop.
                Treas. Reg. Section 1.409A-1(e) and subsequent
                guidance.

            

    

    

    
      	
              2.25

            	
              Plan.
                Plan means the “FPIC Insurance Group, Inc. Deferred Compensation Plan” as
                amended and restated from time to
                time.

            

    

    

    
      	
              2.26

            	
              Plan
                Administrator.
                Plan Administrator means the Committee, or such individuals appointed
                by
                the Committee, acting pursuant to the powers and authority granted
                under
                Section 9.1
                of the Plan. 

            

    

    

    
      	
              2.27

            	
              Plan
                Year.
                Plan Year means January 1 through December
                31.

            

    

    

    
      	
              2.28

            	
              Retirement.
                Retirement means Separation from Service after attaining age
                62. 

            

    

    

    
      	
              2.29

            	
              Separation
                Benefit.
                Separation Benefit shall mean a payment from a Participant’s Separation
                Account to such Participant due to such Participant’s Separation from
                Service. Payment of a Separation Benefit will be made as provided
                in
                Section 8.2
                of the Plan.

            

    

    

    
      
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        FPIC
          Insurance Group, Inc. 2005 Deferred Compensation
          Plan

      

    

    
      	
              2.30

            	
              Separation
                Account.
                Separation Account means an Account established by the Plan Administrator
                to record the amount payable to a Participant due to his or her Separation
                from Service. 

            

    

    

    
      	
              2.31

            	
              Separation
                from Service (or “Separates from Service”).
                An Employee incurs a Separation from Service (Separates from Service)
                when
                he or she ceases to be an employee of the Company or any of its Affiliates
                other than due to death or Disability. A Director or advisory board
                member
                incurs a Separation from Service (Separates from Service) on the
                first day
                the Director is no longer performing services for the Company in
                the
                capacity of a Director. The occurrence of a Separation from Service
                is
                determined by the Plan Administrator under the facts and circumstances
                and
                in accordance with Code Section 409A.  

            

    

    
      

      
        	
                 

              	
                An
                  Employee’s absence from work due to military leave, sick leave, or other
                  bona
                  fide
                  leave of absence (such as temporary employment by the government)
                  shall
                  not constitute a Separation from Service if the period of such
                  leave does
                  not exceed six months or such longer period as is provided either
                  by
                  statute or by contract. If the period of leave exceeds six months
                  and the
                  Employee’s right to reemployment (or reinstatement in the case of a
                  Director) after such extended leave is not provided either by statute
                  or
                  by contract, the Employee shall be deemed to have incurred a Separation
                  from Service on the first day immediately following such six-month
                  period.

              

      

       

      
        
          
            
              
                	
                         

                      	
                        An
                          Employee not described under the preceding leave of absence
                          provisions is
                          deemed to have incurred a Separation from Service if he
                          or she provides
                          services to the Company or an Affiliate at an annual rate
                          that is less
                          than 20% of the services rendered, on average, during the
                          immediately
                          preceding three full calendar years of employment (or the
                          actual period of
                          employment, if less than three years) and the annual remuneration
                          for such
                          services is at least equal to 20% of the average annual
                          remuneration
                          earned, on average, during the immediately preceding three
                          full calendar
                          years of employment (or the actual period of employment,
                          if less than
                          three years).

                      

              

               

              
                
                  
                    	
                             

                          	
                            Where
                              an Employee continues to provide services to a previous
                              employer in a
                              capacity other than as an employee, a Separation from
                              Service will not be
                              deemed to have occurred if the former employee is providing
                              services at an
                              annual rate that is 50% or more of the services rendered,
                              on average,
                              during the immediately preceding three full calendar
                              years of employment
                              (or the actual period of employment, if less than three
                              years) and the
                              annual remuneration for such services is 50% or more
                              of the average annual
                              remuneration earned during the final three full calendar
                              years of
                              employment (or the actual period of employment, if
                              less than three years).
                              For these purposes, the annual rate of providing services
                              is determined
                              based upon the measurement used to determine the service
                              provider’s base
                              compensation (e.g., amounts of time required to earn
                              a salary, hourly
                              wages, or payments for specific
                              projects).

                          

                  

                  
                    

                    
                      	
                               

                            	
                              A
                                Director will not be considered to have a Separation
                                from Service unless
                                the termination of his or her contractual relationship
                                with the Company
                                and its Affiliates constitutes a good-faith and complete
                                termination of
                                the contractual relationship. A
                                good

                            

                    

                    
                      

                      
                        
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                          FPIC
                            Insurance Group, Inc. 2005 Deferred Compensation Plan

                        

                      

                       

                      
                        
                          	
                                   

                                	
                                  faith
                                    and complete termination of the contractual relationship
                                    shall not exist
                                    if the Director anticipates a renewal of the
                                    contractual relationship or
                                    the Director becoming an employee of the Company
                                    or any of its
                                    Affiliates.

                                

                        

                        
                           

                        

                      

                    

                  

                

              

            

          

        

      

    

    
      	
              2.32

            	
              Specified
                Date Account.
                A Specified Date Account means an Account established pursuant to
                Section
                4.4
                that will be paid (or that will commence to be paid) at a future
                date as
                specified in the Participant’s Deferral Election. Unless otherwise
                determined by the Plan Administrator, a Participant may maintain
                no more
                than five (5) Specified Date Accounts. A Specified Date Account may
                be
                identified in enrollment materials as an “In-Service Account”.
                

            

    

    

    
      	
              2.33

            	
              Substantial
                Risk of Forfeiture.
                Substantial Risk of Forfeiture shall have the meaning specified in
                Prop.
                Treas. Reg. Section 1.409A-1(d).

            

    

    

    
      	
              2.34

            	
              Unforeseeable
                Emergency.
                An Unforeseeable Emergency is a severe financial hardship of the
                Participant or Beneficiary resulting from an illness or accident
                of the
                Participant or Beneficiary, the Participant’s or Beneficiary’s spouse, or
                the Participant’s or Beneficiary’s dependent (as defined in Code section
                152(a)); loss of the Participant’s or Beneficiary’s property due to
                casualty (including the need to rebuild a home following damage to
                a home
                not otherwise covered by insurance, for example, as a result of a
                natural
                disaster); or other similar extraordinary and unforeseeable circumstances
                arising as a result of events beyond the control of the Participant
                or
                Beneficiary. For example, the imminent foreclosure of or eviction
                from the
                Participant’s or Beneficiary’s primary residence may constitute an
                Unforeseeable Emergency. In addition, the need to pay for medical
                expenses, including non-refundable deductibles, as well as for the
                costs
                of prescription drug medication, may constitute an Unforeseeable
                Emergency. Finally, the need to pay for the funeral expenses of a
                spouse
                or a dependent (as defined in Code section 152(a)) may also constitute
                an
                Unforeseeable Emergency. Except as otherwise provided in this section,
                the
                purchase of a home and the payment of college tuition are not
                Unforeseeable Emergencies. Whether a Participant or Beneficiary is
                faced
                with an Unforeseeable Emergency permitting a distribution under section
                8.4
                of the Plan is to be determined by the Plan Administrator based on
                the
                relevant facts and circumstances of each case, but, in any case,
                a
                distribution on account of Unforeseeable Emergency may not be made
                to the
                extent that such emergency is or may be reimbursed through insurance
                or
                otherwise, by liquidation of the Participant’s assets, to the extent the
                liquidation of such assets would not cause severe financial hardship,
                or
                by cessation of Deferrals under this Plan or another Company plan.
                

            

    

    

    
      	
              2.35

            	
              Valuation
                Date.
                Valuation Date shall mean each Business Day or such other dates as
                specified by the Plan
                Administrator.

            

    

    

    
      	
              2.36

            	
              Year
                of Service.
                A Year of Service shall mean each 12-month period of continuous service
                with the Company. 

            

    

    

    

    ARTICLE
      III

    
      
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    Eligibility
      and Participation

    

    
      	
              3.1

            	
              Eligibility
                and Participation.
                An individual becomes eligible to file a Deferral Election upon becoming
                an Eligible Employee or Director. An Eligible Employee or Director
                becomes
                a Participant upon the earlier to occur of (i) a credit of Company
                Contributions under Article VI or (ii) filing his or her initial
                Deferral
                Election in accordance with Article
                IV.

            

    

    

    
      	
              3.2

            	
              Duration.
                A Participant shall be eligible to defer Compensation, and an Eligible
                Employee or Director shall be eligible to receive allocations of
                Company
                Contributions, subject to the terms of the Plan, for as long as such
                person is an Eligible Employee (or, in the case of a Director, Separates
                from Service). A Participant who is no longer an Eligible Employee
                or
                Director but continues to be employed by or provides services to
                the
                Company may not defer Compensation under the Plan but may otherwise
                exercise all of the rights of a Participant under the Plan with respect
                to
                his or her Account(s). On and after a Separation from Service, a
                Participant shall remain a Participant as long as his or her Account
                Balance is greater than zero and during such time may continue to
                make
                allocation elections as provided in Section 7.2.
                An individual shall cease being a Participant in the Plan when all
                benefits under the Plan to which he or she is entitled have been
                paid.

            

    

    

    
      	
              3.3

            	
              Revocation
                of Future Participation.
                Notwithstanding the provisions of Section 3.2,
                the Committee may, in its discretion, revoke a Participant’s eligibility
                to make future Deferrals under this Plan. Such revocation will not
                affect
                in any manner a Participant’s Account Balance or other terms of this
                Plan.

            

    

    

    

    
      
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    ARTICLE
      IV

    Deferral
      Elections

    

    
      	
              4.1

            	
              Deferral
                Elections, Generally. 

            

    

    

    
      	 	
              (a)

            	
              An
                Eligible Employee or Director shall submit a Deferral Election during
                the
                enrollment periods established by the Plan Administrator and in the
                manner
                specified by the Plan Administrator, but in any event, in accordance
                with
                Section 4.2.
                A Deferral Election that is not timely filed with respect to a service
                period or component of Compensation shall be considered void and
                shall
                have no effect with respect to such service period or
                Compensation.

            

    

     

    
      
        	 	
                (b)

              	
                Each
                  Deferral Election will specify the amount of Deferrals and the
                  allocation
                  of Deferrals
                  to the Participant’s subaccounts. A Participant may specify in his or her
                  initial Deferral Election the Payment Schedule for each Account
                  in the
                  manner set forth in Section 4.4.
                  If the time and form of payment for any Account is not specified
                  in a
                  Deferral Election, the time and form of payment shall be the time
                  and form
                  specified in Section
                  2.24.

              

      

       

    

    

    
      	
              4.2

            	
              Timing
                Requirements for Deferral
                Elections.

            

    

    

    
      	 	
              (a)

            	
              First
                Year of Eligibility.
                Upon becoming an Eligible Employee or Director, and subject to this
                paragraph (a), the Eligible Employee or Director has up to 30 days
                to
                submit a Deferral Election with respect to Compensation earned during
                such
                year. The Deferral Election described in this paragraph becomes
                irrevocable on the first day following such 30th
                day. An Eligible Employee or Director may file a Deferral Election
                under
                this Section 4.2(a)
                only if he or she does not participate in any other “account balance plan”
                as defined in Prop. Treas. Reg. Section 1.409A-1(c)(i)(A) maintained
                by
                the Company or an Affiliate, other than as permitted in Prop. Treas.
                Reg.
                Section 1.409A-1(c)(ii). 

               

              Except
                as described in paragraph (e) below, a Deferral Election
                filed under this Section 4.2(a)
                applies to Compensation earned on and after the date the Deferral
                Election
                becomes irrevocable. For Compensation that is earned based upon a
                specified performance period (e.g.,
                over a calendar year or fiscal year), where a Deferral Election is
                made in
                the first year of eligibility but after the beginning of the service
                period, unless the Compensation may be timely deferred under this
                Section
                4.2(c),
                the election will be deemed to apply to Compensation paid for services
                performed subsequent to the election if the election applies to the
                portion of the Compensation equal to the total amount of the Compensation
                for the service period multiplied by the ratio of the number of days
                remaining in the performance period after the Deferral Election becomes
                irrevocable over the total number of days in the performance
                period.

            

    

     

    
      	 	
              (b)

            	
              Prior
                Year Deferrals. Eligible
                Employees, Directors and Participants
                may defer Compensation by filing a Deferral Election no later than
                December 31 of the year

            

    

    
      
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                prior
                  to the year in which such Compensation is earned. A Deferral Election
                  described in this paragraph shall become irrevocable with respect
                  to such
                  Compensation as of January 1 of the year in which such Compensation
                  is
                  earned.

              

      

    

    

    
      	 	
              (c)

            	
              Effective
                for the 2007 calendar year only (and any other performance period
                selected
                by the Plan Administrator), a Deferral Election may be filed with
                respect
                to Performance-Based Compensation, provided
                that:

            

    

     

    
      
        	 	
                     
                  (i)

              	
                the
                  Participant performs services continuously from a date no later
                  than the
                  first date of the period for which the performance criteria for
                  such
                  Performance-Based Compensation are measured through a date no earlier
                  than
                  the date upon which the Participant submits a Deferral
                  Election;

              

      

      
         

        
          
            	 	
                         
                      (ii)

                  	
                    the
                      Deferral Election is submitted no later than the date that
                      is six months
                      before the end of the performance period during which such
                      Performance-Based Compensation is earned;
                      and

                  

          

          
             

            
              
                	 	
                             
                          (iii)

                      	
                        in
                          no event may an election to defer Performance-Based Compensation
                          be made
                          after such Performance-Based Compensation has become both
                          substantially
                          certain to be paid and readily
                          ascertainable.

                      

              

               

            

          

        

      

    

    A
      Deferral Election becomes irrevocable with respect to Performance-Based
      Compensation as of the day immediately following the date described in paragraph
      (c)(ii).

    

    
      	 	
              (d)

            	
              Short-Term
                Deferrals.
                If permitted by the Plan Administrator, in its sole discretion,
                compensation that meets the definition of a “short-term deferral”
                described in Prop. Treas. Reg. Section 1.409A-1(b)(4) may be deferred
                under a Deferral Election filed not later than twelve (12) months
                prior to
                the date on which the Substantial Risk of Forfeiture lapses. The
                Payment
                Schedule for such Deferral must specify a commencement date no earlier
                than five (5) years after the forfeiture restriction
                lapses.

            

    

    

    
      	 	
              (e)

            	
              Unforeseeable
                Emergency/Hardship Withdrawal.
                If the Participant incurs an Unforeseeable Emergency under this Plan
                or if
                the termination of a deferral election under this Plan is required
                for the
                Participant to obtain a hardship distribution under the Company’s or an
                Affiliate’s qualified retirement plan containing a qualified cash or
                deferred arrangement under Code Section 401(k), then any Deferral
                Election
                shall immediately terminate with respect to Compensation earned during
                the
                remainder of such Plan Year.

            

    

    

    
      	 	
              (f)

            	
              Transition
                Relief; Deferral Elections Filed by March 15,
                2005.
                Notwithstanding the foregoing and any other provisions in the Plan
                concerning timing of initial deferral elections to the contrary,
                the Plan
                Administrator has the authority, pursuant to transition relief provided
                in
                Q&A 21 of Notice 2005-1, to permit Participants to make or modify
                Deferral Elections with respect to
                Deferrals

            

    

    
      
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                subject
                  to Code Section 409A that relate all or in part to services performed
                  on
                  or before December 31, 2005, so long as: (i) a Deferral Election
                  with
                  respect to such compensation is properly filed with the Plan Administrator
                  prior to March 15, 2005; and (ii) the amounts to which the Deferral
                  Election relate have not been paid or become payable prior to the
                  election.

              

      

       

    

    
      	 	
              (g)

            	
              Transition
                Relief; Revocation, Termination During 2005. Notwithstanding
                any provisions in the Plan concerning the prohibition of payments
                to
                Participants upon a termination of participation in the Plan or the
                cancellation of a Deferral Election during a Plan Year to the contrary,
                the Plan Administrator has the authority, pursuant to transition
                relief
                provided in Q&A 20 of Notice 2005-1, to permit a Participant, pursuant
                to procedures established by the Plan Administrator, to: (i) elect
                to
                terminate, or partially terminate, participation in the Plan and
                receive
                payment of that portion of his or her vested Account Balance payable
                under
                the Plan corresponding to the portion of the Plan to which the termination
                applies; or (ii) elect to cancel or reduce a Deferral Election with
                regard
                to amounts subject to Code Section 409A. An election by a Participant
                permitted in (i) or (ii) above, shall be made and shall result in
                payment
                no later than December 31, 2005.

            

    

    

    
      	
              4.3

            	
              “Evergreen”
                Deferral Elections.
                The Plan Administrator, in its discretion, may provide in the Deferral
                Election that such Deferral Election will continue in effect for
                each
                subsequent year or performance period. Such “evergreen” Deferral Elections
                will become effective with respect to an item of Compensation on
                the date
                such election becomes irrevocable under Section 4.2.
                An evergreen Deferral Election may be terminated or modified prospectively
                with respect to Compensation for which such election remains revocable
                under Section 4.2.
                A Participant whose Deferral Election is suspended due to an Unforeseeable
                Emergency will be required to file a new Deferral Election under
                this
                Article IV in order to continue making Deferrals under the
                Plan.

            

    

    

    
      	
              4.4

            	
              Specified
                Date Elections.
                A Participant’s Deferral Election may establish a Specified Date Account
                by allocating deferrals and contributions to such Account and specifying
                the Payment Schedule for Deferrals and Earnings credited to such
                Account. 

            

    

    

    
      	 	
              (a)

            	
              Allocation
                of Deferrals.
                A Deferral Election may allocate Deferrals to one or more Specified
                Date
                Accounts. The Plan Administrator may, in its discretion, establish
                a
                minimum deferral period (for example, the third Plan Year following
                the
                year Compensation subject to the Deferral Election is earned).
                

            

    

    

    
      	 	
              (b)

            	
              Effect
                of Earlier Separation from Service or Death.
                In the event of a Separation from Service, or death, the unpaid balance
                of
                any Specified Date Account will be paid according to the Participant’s
                Deferral Election applicable to such triggering
                event.

            

    

    

    
      	
              4.5

            	
              Deductions
                from Pay.
                The Plan Administrator has the authority to determine the payroll
                practices under which any component of Compensation subject to a
                Deferral
                Election will be deducted from a Participant’s
                Compensation.

            

    

    
      
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    ARTICLE
      V 

    Modifications
      to Payment Schedules

    

    
      	
              5.1

            	
              Participant’s
                Right to Modify.
                Subject to Section 5.2,
                a Participant may modify the Payment Schedule with respect to an
                Account,
                provided such modification complies with the requirements of Sections
                5.1(a)
                and (b). 

            

    

    

    
      	 	
              (a)

            	
              Time
                of Election. The
                date on which a modification election is submitted to the Plan
                Administrator must be at least twelve (12) months prior to the date
                on
                which payment commences under the Payment Schedule in effect for
                the
                applicable Account prior to modification, and the date payments commence
                under the modified Payment Schedule must occur no earlier than five
                (5)
                years after the date payment would have commenced under the Payment
                Schedule in effect prior to the effective date of the modification
                election. Under no circumstances may a modification election result
                in an
                acceleration of payments in violation of Code Section
                409A.

            

    

    

    
      	 	
              (b)

            	
              Effective
                Date. 
                Once received by the Plan Administrator, a modification election
                described
                in Section 5.1(a)
                may not be further modified, except by new election under 5.1(a).
                A
                modification election becomes effective on the date that is twelve
                (12)
                months after the date the modification is received by the Plan
                Administrator.

            

    

    

    
      	 	
              (c)

            	
              Effect
                on Accounts. An
                election to modify a Payment Schedule is specific to the Account
                to which
                it applies, and shall not be construed to affect the Payment Schedules
                of
                any other Accounts.

            

    

    

    
      	 	
              (d)

            	
              Effect
                of Modification Election Upon Death or
                Disability. 
                A modification to the form of payment from any Account that would
                also
                change the form of payment upon the Participant’s death will be effective
                at the time specified in Section 5.1(b)
                above. Payment will be made in accordance with Section 2.23,
                without regard to the five-year requirement specified in Section
                5.1(a).

            

    

    

    
      	
              5.2

            	
              Modifications
                Authorized Under Notice 2005-1, Notice 2006-79 and Proposed
                Regulations.
                Notwithstanding any provision of this Plan to the contrary, during
                calendar year 2006 and 2007, a Participant may modify any Payment
                Schedule
                of any Account without regard to the requirements of Section 5.1(a)
                and (b);
                provided, however, that any modification election purporting to modify
                an
                Account with a Payment Schedule commencing during the same Plan Year
                as
                the Plan Year during which the election to modify is made, or which
                would
                cause the commencement date of the Payment Schedule for an Account
                to be
                accelerated into the same Plan Year as the Plan Year during which
                the
                election to modify is made shall be null and void to the extent such
                election is inconsistent with the requirements of Code Section 409A.
                The
                Plan Administrator has the authority to prescribe the time and manner
                under which such modifications may be
                made.

            

    

    
      
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          Plan

      

    

    

    

    ARTICLE
      VI

    Company
      Contributions

    

    
      	
              6.1

            	
              Company
                Contributions.
                The Company may, from time to time in its sole and absolute discretion,
                credit Company Contributions to any Participant in any amount determined
                by the Company. Such
                contributions will be credited to a Participant’s Separation
                Account.

            

    

    

    
      	
              6.2

            	
              Vesting.
                Company Contributions, and the Earnings thereon, shall vest in accordance
                with the vesting schedule(s) established by the Committee at the
                time the
                Company Contribution is made. All Company Contributions shall become
                100%
                vested upon the occurrence of the earliest of: (i) the death of the
                Participant; (ii) Retirement of the Participant, (iii) Separation
                from
                Service within thirty six (36) months after a Change in Control or
                (iv)
                termination of the Plan following a Change in Control. The Company
                may, at
                any time, in its sole discretion, increase a Participant’s vested interest
                in a Company Contribution. The portion of a Participant’s Accounts that
                remains unvested upon his or her Separation from Service after the
                application of the terms of this Section 6.2
                shall be forfeited. 

            

    

    

    

    ARTICLE
      VII

    Valuation
      of Account Balances; Investments

    

    
      	
              7.1

            	
              Valuation.
                Deferrals shall be credited to appropriate Accounts on the date such
                Compensation would have been paid to the Participant absent the Deferral
                Election. Company Contributions shall be credited in accordance with
                the
                provisions of Article VI, as determined by the Plan Administrator.
                Valuation of Accounts shall be performed under procedures approved
                by the
                Plan Administrator.

            

    

    

    
      	
              7.2

            	
              Earnings
                Credit.
                Each Account will be credited with Earnings on each Business Day,
                based
                upon the Participant’s investment allocation among a menu of investment
                options selected in advance by the Plan Administrator, in accordance
                with
                the provisions of this Section 7.2
                (“investment allocation”).

            

    

    

    
      	 	
              (a)

            	
              Investment
                Options.
                Investment options will consist of actual investments, which may
                include
                stocks, bonds, mutual fund shares, and other investments. The
                Committee, in its sole discretion, shall be permitted to add or remove
                investment funds from the Plan menu from time to time provided that
                any
                such additions or removals of investment funds shall not be effective
                with
                respect to any period prior to the effective date of such
                change.

            

    

    

    
      	 	
              (b)

            	
              Investment
                Allocations. A
                Participant’s investment allocation constitutes a deemed, not actual,
                investment among the investment options comprising the investment
                menu. At
                no time shall a Participant have any real or beneficial ownership
                in any
                investment option included in the investment menu, nor shall the
                Company
                or any

            

    

    
      
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                trustee
                  acting on its behalf have any obligation to purchase actual securities
                  as
                  a result of a Participant’s investment allocation.
                  A Participant’s investment allocation shall be used solely for purposes of
                  adjusting the value of a Participant’s Account
                  Balances.

              

      

       

      
        
          
            	 	
                     

                  	
                    A
                      Participant’s Deferral Election shall specify the investment allocation
                      for Deferrals. Deferrals may be allocated among the investment
                      options in
                      increments of 1%. The Participant’s investment allocation will become
                      effective on the same Business Day or, in the case of investment
                      allocations received after a time specified by the Plan Administrator,
                      the
                      next Business Day. The investment allocation specified in such
                      Deferral
                      Election will remain in effect until the Participant modifies
                      the
                      investment allocation in accordance with procedures adopted
                      by the Plan
                      Administrator.

                  

          

          
             

            
              
                
                  	 	
                           

                        	
                          Participants
                            also may re-allocate current Account Balances among the
                            investment options
                            in increments of 1% by filing a new investment allocation
                            at the time and
                            in the form specified by the Plan Administrator. The
                            Participant’s
                            investment allocation will become effective on the same
                            Business Day or,
                            in the case of investment allocations received after
                            a time specified by
                            the Plan Administrator, the next Business Day. The investment
                            allocation
                            shall apply prospectively to the Account or Accounts
                            identified in the
                            allocation.

                        

                

                 

              

            

          

        

      

    

    
      	 	
              (c)

            	
              Unallocated
                Deferrals and Accounts.
                If any portion of a Deferral or Account Balance has not been allocated
                to
                an investment option, such portion shall be invested in an investment
                option, the primary objective of which is the preservation of capital,
                as
                determined by the Committee.

            

    

    

    

    ARTICLE
      VIII

    Distribution
      and Withdrawals

    

    
      	
              8.1

            	
              Specified
                Date Accounts.
                Subject to Section 4.4(b) the vested Account Balance of each Specified
                Date Account will be paid in accordance with the Payment Schedule
                in
                effect for such Account and the provisions of Sections 8.6.

            

    

    

    
      	
              8.2

            	
              Separation
                Payments.
                In the event of the Participant’s Separation from Service prior to
                receiving all payments from his or her Accounts, the Participant’s
                remaining Account Balance will be paid in
                accordance with the Payment Schedule in effect for the Separation
                Benefit
                and the provisions of Sections 8.6.
                If the Separation from Service occurs after a Change in Control,
                payment
                will be made in accordance with Section
                8.5.

            

    

    

    
      	
              8.3

            	
              Death
                Benefit.
                In the event of the Participant’s death prior to receiving all payments
                from his or her Accounts, the Participant’s remaining Account Balances
                will be paid in a single lump sum as provided in Section 2.23 to
                the
                Participant’s Beneficiaries.  

            

    

    

    
      
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              8.4

            	
              Unforeseeable
                Emergency. A Participant shall submit a written notification to the
                Plan Administrator to receive a distribution from his or her vested
                Accounts if the Participant experiences an Unforeseeable Emergency.
                Distributions of amounts in the event of an Unforeseeable Emergency
                are
                limited to the extent reasonably needed to satisfy the emergency
                need
                which cannot be met from other sources. The amount of such distribution
                shall be subtracted first from the vested portion of the Participant's
                Separation Account until depleted and then from the vested Specified
                Date
                Accounts, beginning with the Specified Date Account with the latest
                payment commencement date. For purposes of the preceding sentence,
                any
                minimum deferral requirement specified in the Plan or Section 5.1
                shall
                not apply. A distribution under this paragraph shall be considered
                mandatory until such time as the Plan Administrator determines that
                distributions upon Unforeseeable Emergency may be made on a discretionary
                basis under Code Section 409A (at which point they will become
                discretionary and payable upon the Company’s receipt of proper application
                of the Participant).

            

    

    

    
      	
              8.5

            	
              Change
                in Control.
                Regardless of his or her Deferral Election, a Participant who incurs
                a
                Separation from Service within thirty-six (36) months following the
                date
                of a Change in Control shall receive payment of his or her Accounts
                in a
                single lump sum at the time specified in Section 2.23(b) and in accordance
                with the provisions of Section 8.6.

            

    

    

    
      	
              8.6

            	
              Valuation
                and Payment.
                Payment amounts will be based on the valuation of the applicable
                vested
                Account Balance as of the Valuation Date specified by the Plan
                Administrator in its discretion. 

            

    

     

    
      
        	
                 

              	
                Payment
                  is treated as made upon the payment commencement date under the
                  applicable
                  Payment Schedule if the payment is made on or after such date in
                  the same
                  calendar year or by March 15 of the calendar year following the
                  date
                  specified under the arrangement.  If
                  a calculation of the amount of the payment is not administratively
                  practical due to events beyond the control of the Participant,
                  a
                  Beneficiary or the Participant’s estate, the payment will be treated as
                  made upon the date specified under the Payment Schedule if the
                  payment is
                  made during the first calendar year in which the payment becomes
                  administratively practicable.

              

      

      

      

    

    
      	
              8.7

            	
              Installments;
                Declining Balance Calculation.
                If a Payment Schedule specifies installment payments, annual payments
                will
                be made beginning as of the payment commencement date for such
                installments and shall continue on each anniversary thereof until
                the
                number of installment payments specified in the Payment Schedule
                has been
                paid. The amount of each installment payment shall be determined
                by
                dividing (a) by (b):

            

    

    

    
      	 	
              (a)

            	
              equals
                the Account Balance as of the Valuation Date
                and

            

    

    
      	 	
              (b)

            	
              equals
                the remaining number of installment
                payments.

            

    

    

    
      	
              8.8

            	
              “De
                Minimis Account” Balance.
                Any provision in this Plan to the contrary notwithstanding, payment
                to a
                Participant or Beneficiary will be made in a single
                lump

            

    

    
      
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                sum,
                  provided (i) the payment accompanies the payment of the entirety
                  of the
                  Participant’s interest in the Plan and all similar arrangements that
                  constitute a nonqualified deferred compensation arrangement under
                  Prop.
                  Treas. Reg. Section 1.409A-1(c); and (ii) the payment is not greater
                  than
                  $25,000. Payment under this Section shall be made on or before
                  the later
                  of December 31 of the calendar year in which occurs the Participant’s
                  Separation from Service (if applicable), or the 15th
                  day of the third month following the Participant’s Separation from Service
                  (if applicable). Any Payment Schedule contrary to the provisions
                  of this
                  Section 8.8
                  shall be null and
                  void.

              

      

    

    

    
      	
              8.9

            	
              Domestic
                Relations Order.
                Notwithstanding any benefit, Payment Schedule or other provision
                of this
                Plan regarding the time and form of payment, and to the extent permitted
                by Code Section 409A, the Plan Administrator may pay all or a portion
                of a
                Participant’s Accounts to an “alternate payee” as specified under the
                terms of a domestic relations order (defined in Code Section
                414(p)(1)(B)). If a time or form of payment is not specified in such
                order, payment will be made to such alternate payee(s) in a single
                lump
                sum as soon as is administratively practical following the Plan
                Administrator’s determination that the order meets the requirements of
                this Section 8.9. 

            

    

    

    
      	
              8.10

            	
              Payment
                of Employment Taxes.
                The Plan Administrator may permit payment of (i) Federal Insurance
                Contributions Act (FICA) tax imposed on Deferrals and Company
                Contributions (ii) any related federal, state, local and foreign
                tax law
                withholding obligations arising in connection with payment of the
                FICA
                Amount (as defined under Treasury regulations), and (iii) to pay
                the
                additional income tax at the source on wages attributable to the
                pyramiding of wages and taxes as a result of payments under (i) and
                (ii).
                The total amount of the payment under this Section shall not exceed
                the
                FICA Amount and the income tax withholding related to the FICA
                Amount.

            

    

    

    
      	
              8.11

            	
              Permissible
                Payment Delays.
                The Company will delay any payment to a Participant upon the Company’s
                reasonable anticipation of one or more of the
                following:

            

    

    

    
      	 	
              (a)

            	
              The
                Company’s income tax deduction with respect to such payment would be
                limited or eliminated by application of Code Section 162(m); provided
                that
                such payment will be made either at the earliest date on which the
                Company
                reasonably anticipates that the deduction will not be so limited
                or
                eliminated or the calendar year in which the Participant incurs a
                Separation from Service; or

            

    

    

    
      	 	
              (b)

            	
              Making
                such payment after a Change in Control would violate a term of a
                loan
                agreement to which the Company or an Affiliate is a party, or other
                similar contract to which the Company, or an Affiliate, is a party,
                and
                such violation would cause material harm to the Company or an Affiliate;
                provided that payment will be made at the earliest date on which
                the
                Company reasonably anticipates that making the payment will not cause
                such
                violation or such violation will not cause material harm to the Company
                and subject to such other requirements as are specified under Code
                Section
                409A; or

            

    

    

      
        	 	
                (c)

              	
                Making
                  such payment would violate federal securities laws or other applicable
                  law; provided that payment will be made at the earliest date which
                  the
                  Company 

              

      

      

    

    

    
      
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              anticipates
                that the making of the payment will not cause such violation, and
                subject
                to such other requirements as are specified under Code Section
                409A.

            

    

    

    

    ARTICLE
      IX 

    Administration

    

    
      	
              9.1

            	
              Plan
                Administration.
                This Plan shall be administered by the Plan Administrator which shall
                have
                discretionary authority to make, amend, interpret and enforce all
                appropriate rules and regulations for the administration of this
                Plan and
                to utilize its discretion to decide or resolve any and all questions,
                including but not limited to eligibility for benefits and interpretations
                of this Plan and its terms, as may arise in connection with the Plan.
                Claims for benefits shall be filed with the Plan Administrator and
                resolved in accordance with the claims procedures in Article
                XII.

            

    

    

    The
      Company shall, with respect to the Plan Administrator identified under this
      Section or Section 9.2, (i) pay all reasonable expenses and fees of the Plan
      Administrator, (ii) indemnify the Plan Administrator (including individual
      Committee members) against any costs, expenses and liabilities including,
      without limitation, attorneys’ fees and expenses arising in connection with the
      performance of the Plan Administrator hereunder, except with respect to matters
      resulting from the Plan Administrator’s gross negligence or willful misconduct
      and (iii) supply full and timely information to the Plan Administrator on all
      matters related to the Plan, any rabbi trust, Participants, Beneficiaries and
      Accounts as the Plan Administrator may reasonably require.

    

    
      	
              9.2

            	
              Administration
                Upon Change in Control.
                Upon a Change in Control, the individuals serving on the Committee
                immediately prior to such Change in Control, shall continue to act
                as the
                Committee until their death, disability, resignation or removal.
                After a
                Change in Control (i) members of the Committee may not be added except
                to
                replace a former member who has ceased to serve and (ii) such replacement
                members shall be appointed, and members of the Committee may only
                be
                removed, by a majority of the persons who are serving on the Board
                of
                Directors of the Company immediately prior to such Change in Control.
                

            

    

    

    
      	
              9.3

            	
              Withholding.
                The Company shall have the right to withhold from any payment due
                under
                the Plan (or any amount deferred into the Plan) any taxes required
                by law
                to be withheld in respect of such payment (or
                Deferral).

            

    

    

    
      	
              9.4

            	
              Indemnification.
                The Company shall indemnify and hold harmless each employee, officer,
                director, agent or organization, to whom or to which it delegated
                duties,
                responsibilities, and authority under the Plan or otherwise with
                respect
                to administration of the Plan, including, without limitation, the
                Plan
                Administrator, the Committee and their agents, against all claims,
                liabilities, fines and penalties, and all expenses reasonably incurred
                by
                or imposed upon him or it (including but not limited to reasonable
                attorney fees) which arise as a result of his or its actions or failure
                to
                act in connection with the operation and administration of the Plan
                to the
                extent lawfully allowable and to the
                extent

            

    

    
      
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                that
                  such claim, liability, fine, penalty, or expense is not paid for
                  by
                  liability insurance purchased or paid for by the Company. Notwithstanding
                  the foregoing, the Company shall not indemnify any person or organization
                  if his or its actions or failure to act are due to gross negligence
                  or
                  willful misconduct or for any such amount incurred through any
                  settlement
                  or compromise of any action unless the Company consents in writing
                  to such
                  settlement or compromise.

              

      

       

    

    
      	
              9.5

            	
              Delegation
                of Authority.
                In the administration of this Plan, the Plan Administrator may, from
                time
                to time, employ agents and delegate to them such administrative duties
                as
                it sees fit, and may from time to time consult with legal counsel
                who may
                be legal counsel to the Company.

            

    

    

    
      	
              9.6

            	
              Binding
                Decisions or Actions.
                The decision or action of the Plan Administrator in respect of any
                question arising out of or in connection with the administration,
                interpretation and application of the Plan and the rules and regulations
                thereunder shall be final and conclusive and binding upon all persons
                having any interest in the Plan. 

            

    

    

    

    
      
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    ARTICLE
      X

    Amendment
      and Termination

    

    
      	
              10.1

            	
              Amendment
                and Termination.
                The Company may at any time and from time to time amend the Plan
                or may
                terminate the Plan as provided in this Section 10.1.

            

    

    

    
      	 	
              (a)

            	
              Amendments.
                The Company, by action taken by its Board of Directors, may amend
                the Plan
                at any time, provided that any such amendment shall not reduce the
                vested
                Account Balances of any Participant accrued as of the date of any
                such
                amendment or restatement (as if the Participant had incurred a voluntary
                Separation from Service on such date) or reduce any rights of a
                Participant under the Plan or other Plan features with respect to
                Deferrals made prior to the date of any such amendment or restatement
                without the consent of the Participant. The Board of Directors may
                delegate to the Plan Administrator the authority to amend the Plan
                without
                the consent of the Board of Directors for the purpose of (i) conforming
                the Plan to the requirements of law, (ii) to facilitate administration,
                (iii) to clarify provisions based on the Plan Administrator’s
                interpretation of the document and (iv) to make such other amendments
                as
                the Board of Directors may authorize. Notwithstanding the foregoing,
                the
                Plan may not be amended after a Change in Control, except to the
                extent
                necessary to comply with the requirements of law and then only if
                such
                amendment does not reduce the Account Balances (whether vested or
                unvested) or rights of any Participant or
                Beneficiary.

            

    

    

    
      	 	
              (b)

            	
              Termination.
                The Company, by action taken by its Board of Directors , may terminate
                the
                Plan and pay Participants and Beneficiaries their Account Balances
                in a
                single lump sum at any time under the following conditions and provided
                the Company complies with the vesting requirements of Section
                6.2.

            

    

    

    
      	 	
              (1)

            	
              Company’s
                Discretion.
                The Company may terminate the Plan in its discretion, provided that
                (i)
                all arrangements sponsored by the Company that would be aggregated
                with
                any terminated arrangement under Prop. Treas. Regulation Section
                1.409A-1(c) if the same Participant participated in all of the
                arrangements, are terminated; (ii) no payments other than payments
                that
                would be payable under the terms of the arrangements if the termination
                had not occurred are made within 12 months of the termination of
                the
                arrangements (iii) all payments are made within 24 months of the
                termination of the arrangements, and (iv) the Company or its Affiliates
                do
                not adopt a new arrangement that would be aggregated with any terminated
                arrangement under Section 1.409A-1(c) if the same Participant participated
                in both arrangements, at any time within five years following the
                date of
                termination of the arrangement. 

            

    

    

    
      	 	
              (2)

            	
              Change
                in Control.
                The Company may terminate the Plan within the thirty (30) days preceding
                or the twelve months following a Change in Control (as defined in
                Section
                1.409A-2(g)(4)(i)). For purposes of
                this

            

    

    
      
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                paragraph,
                  a Change in Control shall be defined as provided in Prop. Treas.
                  Reg.
                  Section 1.409A-2(g)(4)(i). The Plan is considered terminated under
                  this
                  paragraph only if all substantially similar arrangements are terminated,
                  and all participants under such arrangements are required to receive
                  all
                  amounts of compensation deferred under the terminated arrangements
                  within
                  twelve months of the termination of such
                  arrangements.

              

      

       

    

    
      	 	
              (3)

            	
              Dissolution;
                Bankruptcy Court Order.
                The Company may terminate the Plan within 12 months of a corporate
                dissolution taxed under Code Section 331, or with the approval of
                a
                bankruptcy court pursuant to 11 U.S.C. Section 403(b)(1)(A), provided
                that
                the vested Account Balances are included in Participants’ gross incomes in
                the latest of (i) the calendar year in which the Plan terminates;
                (ii) the
                calendar year in which the amount is no longer subject to a substantial
                risk of forfeiture, or (iii) the first calendar year in which the
                payment
                is administratively practicable.

            

    

    

    
      	
              10.2

            	
              Accounts
                Taxable Under Code Section 409A.
                The Plan is intended to constitute a plan of deferred compensation
                that
                meets the requirements for deferral of income taxation under Code
                Section
                409A. The Plan Administrator, pursuant to its authority to interpret
                the
                Plan, may sever from the Plan or any Deferral Election any provision
                or
                exercise of a right that otherwise would result in a violation of
                Code
                Section 409A. If, after application of the preceding sentence, the
                Plan
                Administrator determines that a Participant’s Accounts are taxable or if
                such Participant receives a notice of deficiency from the Internal
                Revenue
                Service due to a violation of Code Section 409A, such Participant
                will receive payment from his or her Accounts in a single lump sum.
                The
                amount of the payment shall not exceed the lesser of (i) the
                Participant’s Account Balance or (ii) an amount equal to the amount
                of income included in taxable income as a result of such violation,
                plus
                an additional amount, to the extent permissible under Treasury Department
                regulations, for penalties under Code Section 409A, other taxes and
                interest or other costs. Payment under this Section 10.2,
                including the amount of any taxes, penalties, interest or other costs,
                shall be applied against the Participant’s Accounts and shall constitute
                fulfillment of the Company’s payment obligation to such Participant under
                the Plan to the extent of any such
                payments.

            

    

    

    

    ARTICLE
      XI

    Informal
      Funding

    

    
      	
              11.1

            	
              General
                Assets.
                Obligations established under the terms of the Plan may be satisfied
                from
                the general funds of the Company, an Affiliate, or a trust described
                in
                Section 11.2. No Participant, spouse or Beneficiary shall have any
                right,
                title or interest whatever in assets of the Company or an Affiliate.
                Nothing contained in this Plan, and no action taken pursuant to its
                provisions, shall create or be construed to create a trust of any
                kind, or
                a fiduciary relationship, between the Company or its Affiliates and
                any
                Employee, spouse, or Beneficiary. To the extent that any person acquires
                a
                right to receive

            

    

    
      
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                payments
                  from the Company hereunder, such rights are no greater than the
                  right of
                  an unsecured general creditor of the
                  Company.

              

      

      

      
        	
                11.2

              	
                Rabbi
                  Trust.
                  The Company or an Affiliate may, at its sole discretion, establish
                  a
                  grantor trust, commonly known as a rabbi trust, as a vehicle for
                  accumulating assets to pay benefits under the Plan. Payments under
                  the
                  Plan may be paid from the general assets of the Company or from
                  the assets
                  of any such rabbi trust. Payment from any such source shall reduce
                  the
                  Company’s obligation to the Participant or Beneficiary under the
                  Plan.

              

      

    

     

    
      	
              11.3

            	
              Affiliate
                Contribution.
                If an Eligible Employee or Director of an Affiliate becomes a Participant
                in this Plan, the applicable Affiliate shall promptly forward all
                deferrals elected hereunder to the Company and shall provide to the
                Company, upon request, its allocable share of any Company Contribution
                for
                any such Participant.

            

    

     

    

    
      
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    ARTICLE
      XII

    Claims
      

    

    
      	
              12.1

            	
              Filing
                a Claim.
                Any controversy or claim arising out of or relating to the Plan shall
                be
                filed in writing with the Plan Administrator which shall make all
                determinations concerning such claim. Any claim filed with the Plan
                Administrator and any decision by the Plan Administrator denying
                such
                claim shall be in writing and shall be delivered to the Participant
                or
                Beneficiary filing the claim (the “Claimant”).

            

    

    

    
      	
              12.2

            	
              In
                General.
                Notice of a denial of benefits (other than Disability benefits) will
                be
                provided within ninety (90) days of the Plan Administrator’s receipt of
                the Claimant's claim for benefits. If the Plan Administrator determines
                that it needs additional time to review the claim, the Plan Administrator
                will provide the Claimant with a notice of the extension before the
                end of
                the initial ninety (90) day period. The extension will not be more
                than
                ninety (90) days from the end of the initial ninety (90) day period
                and
                the notice of extension will explain the special circumstances that
                require the extension and the date by which the Plan Administrator
                expects
                to make a decision.

            

    

    

    
      	
              12.3

            	
              Contents
                of Notice.
                If a claim for benefits is completely or partially denied, notice
                of such
                denial shall be in writing and shall set forth the reasons for denial
                in
                plain language. The notice shall (i) cite the pertinent provisions
                of the
                Plan document and (ii) explain, where appropriate, how the Claimant
                can
                perfect the claim, including a description of any additional material
                or
                information necessary to complete the claim and why such material
                or
                information is necessary. The claim denial also shall include an
                explanation of the claims review procedures and the time limits applicable
                to such procedures, including a statement of the Claimant’s right to bring
                a civil action under Section 502(a) of ERISA following an adverse
                decision
                on review. 

            

    

    

    
      	
              12.4

            	
              Appeal
                of Denied Claims.
                A Claimant whose claim has been completely or partially denied shall
                be
                entitled to appeal the claim denial by filing a written appeal with
                a
                committee designated by the Committee to hear such appeals (the “Appeals
                Committee). A Claimant who timely requests a review of the denied
                claim
                (or his or her authorized representative) may review, upon request
                and
                free of charge, copies of all documents, records and other information
                relevant to the denial and may submit written comments, documents,
                records
                and other information relevant to the claim to the Appeals Committee.
                All
                written comments, documents, records, and other information shall
                be
                considered “relevant” if the information (i) was relied upon in making a
                benefits determination,(ii) was submitted, considered or generated
                in the
                course of making a benefits decision regardless of whether it was
                relied
                upon to make the decision, or (iii) demonstrates compliance with
                administrative processes and safeguards established for making benefit
                decisions. The Appeals Committee may, in its sole discretion and
                if it
                deems appropriate or necessary, decide to hold a hearing with respect
                to
                the claim appeal.

            

    

    

    
      	 	
              (a)

            	
              In
                General. 
                Appeal of a denied benefits claim (other than a Disability benefits
                claim)
                must be filed in writing with the Appeals Committee no later than
                sixty
                (60) days after receipt of the written notification of such claim
                denial.
                The

            

    

    
      
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                Appeals
                  Committee shall make its decision regarding the merits of the denied
                  claim within sixty (60) days following receipt of the appeal (or
                  within
                  one hundred and twenty (120) days after such receipt, in a case
                  where
                  there are special circumstances requiring extension of time for
                  reviewing
                  the appealed claim). If an extension of time for reviewing the
                  appeal is
                  required because of special circumstances, written notice of the
                  extension
                  shall be furnished to the Claimant prior to the commencement of
                  the
                  extension. The notice will indicate the special circumstances requiring
                  the extension of time and the date by which the Appeals Committee
                  expects
                  to render the determination on review. The review will take into
                  account
                  comments, documents, records and other information submitted by
                  the
                  Claimant relating to the claim without regard to whether such information
                  was submitted or considered in the initial benefit
                  determination.

              

      

       

    

    
      	 	
              (b)

            	
              Contents
                of Notice.
                If a benefits claim is completely or partially denied on review,
                notice of
                such denial shall be in writing and shall set forth the reasons for
                denial
                in plain language. The decision on review shall set forth (i) the
                specific
                reason or reasons for the denial, (ii) specific references to the
                pertinent Plan provisions on which the denial is based, (iii) a statement
                that the Claimant is entitled to receive, upon request and free of
                charge,
                reasonable access to and copies of all documents, records, or other
                information relevant (as defined above) to the Claimant’s claim, and (iv)
                a statement describing any voluntary appeal procedures offered by
                the plan
                and a statement of the Claimant’s right to bring an action under Section
                502(a) of ERISA. 

            

    

    

    
      	 	
              (c)

            	
              Authority
                of Appeals Committee; Fees and Expenses. The
                Appeals Committee shall have the exclusive authority at the appeals
                stage
                to interpret the terms of the Plan and resolve appeals under the
                Claims
                Procedure.

            

    

     

    
      
        	 	
                 

              	
                The
                  Company shall, with respect to the Plan Administrator identified
                  under
                  this Section, (i) pay all reasonable expense and fees of the Appeals
                  Committee, (ii) indemnify the Appeals Committee (including individual
                  committee members) against any costs, expenses and liabilities
                  including,
                  without limitation, attorneys’ fees and expenses arising in connection
                  with the performance of the Appeals Committee hereunder, except
                  with
                  respect to matters resulting from the Appeals Committee’s gross negligence
                  or willful misconduct and (iii) supply full and timely information
                  to the
                  Appeals Committee on all matters related to the Plan, any rabbi
                  trust,
                  Participants, Beneficiaries and Accounts as the Appeals Committee
                  may
                  reasonably require.

              

      

    

    

    
      	
              12.5

            	
              Legal
                Action.
                A Claimant may not bring any legal action, including commencement
                of any
                arbitration, relating to a claim for benefits under the Plan unless
                and
                until the Claimant has followed the claims procedures under the Plan
                and
                exhausted his or her administrative remedies under such claims
                procedures.

            

    

    
      

      
        	
                 

              	
                If
                  a Participant or Beneficiary prevails in a legal proceeding brought
                  under
                  the Plan to enforce the rights of such Participant or any other
                  similarly-situated Participant or

              

      

       

    

     

    
      
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                  Beneficiary,
                    in whole or in part, the Company shall reimburse such Participant
                    or
                    Beneficiary for all legal costs, expenses, attorneys’ fees and such other
                    liabilities incurred as a result of such
                    proceedings.

                

        

         

      

    

    
      	
              12.6

            	
              Discretion
                of Committee.
                All interpretations, determinations and decisions of the Appeals
                Committee
                with respect to any claim shall be made in its sole discretion, and
                shall
                be final and conclusive.

            

    

    

    
      	
              12.7

            	
              Arbitration. 

            

    

     

    
      	 	
              (a)

            	
              Before
                a Change in Control. If,
                prior to a Change in Control, any dispute, controversy or claim between
                the Company or any Affiliate and a Participant or Beneficiary out
                of or
                relating to or concerning the provisions of the Plan is not resolved
                through the claims procedure set forth in Article XII, such dispute,
                controversy or claim shall be settled by arbitration before a neutral
                arbitrator through arbitration administered by the American Arbitration
                Association in the location where the Company maintains its principal
                place of business, in accordance with the United States Arbitration
                Act (9
                USC, § 1 et seq.) and the rules of the American Arbitration Association
                under its National Rules for the Resolution of Employment Disputes.
                All
                awards of the arbitration shall be final, binding and non-appealable,
                and
                judgment upon the award of the arbitrator may be entered in any court
                having jurisdiction thereof. The arbitration shall take place at
                a time
                noticed by the American Arbitration Association regardless of whether
                one
                of the parties fails or refuses to participate. The arbitrator shall
                have
                authority to award any remedy or relief that a court of competent
                jurisdiction could order or grant, including, without limitation,
                specific
                performance of any obligation created under this Plan, the issuance
                of an
                injunction or other provisional relief, or the imposition of sanctions
                for
                abuse or frustration of the arbitration process. The parties shall
                be
                entitled to engage in reasonable discovery, including a request for
                the
                production of relevant documents. Depositions may be ordered by the
                arbitrator upon a showing of need. The foregoing provisions shall
                not
                preclude the Company or Affiliate from bringing an action in any
                court of
                competent jurisdiction for injunctive or other provisional relief
                as the
                Company or Affiliate may determine is necessary or appropriate. The
                costs
                of the arbitrator shall be paid by the Company or Affiliate, but
                the
                Participant or Beneficiary shall be responsible for the costs of
                his or
                her advisors. 

            

    

    

    
      	 	
              (b)

            	
              After
                Change in Control. If,
                after the occurrence of a Change in Control, any dispute, controversy
                or
                claim arises between a Participant or Beneficiary and the Company
                or an
                Affiliate out of or relating to or concerning the provisions of the
                Plan,
                such dispute, controversy or claim shall be finally settled by a
                court of
                competent jurisdiction which, notwithstanding any other provision
                of the
                Plan, shall apply a de novo standard of review to any determination
                made
                by the Company, the Board or the Appeals Committee (or their permitted
                delegatee).

            

    

    

    
      
        Page 25
          of 29

        
        

      

      
        
        

        
        

      

      
        
        

        FPIC
          Insurance Group, Inc. 2005 Deferred Compensation
          Plan

      

    

    ARTICLE
      XIII

    General
      Conditions

    

    
      	
              13.1

            	
              Anti-assignment
                Rule.
                Except to the extent permitted by Section 8.10, no interest of any
                Participant, spouse or Beneficiary under this Plan and no benefit
                payable
                hereunder shall be assigned as security for a loan, and any such
                purported
                assignment shall be null, void and of no effect, nor shall any such
                interest or any such benefit be subject in any manner, either voluntarily
                or involuntarily, to anticipation, sale, transfer, assignment or
                encumbrance by or through any Participant, spouse or Beneficiary.
                

            

    

    

    
      	
              13.2

            	
              No
                Legal or Equitable Rights or Interest.
                No Participant or other person shall have any legal or equitable
                rights or
                interest in this Plan that are not expressly granted in this Plan.
                Participation in this Plan does not give any person any right to
                be
                retained in the service of the Company, any Affiliate, or any of
                the
                Company’s subsidiaries or affiliated companies. The right and power of the
                Company or an Affiliate to dismiss or discharge an Employee or Director
                is
                expressly reserved.

            

    

    

    Notwithstanding
      the provisions of Section 10.2,
      the Company makes no representations or warranties as to the tax consequences
      to
      a Participant or a Participant’s beneficiaries resulting from a deferral of
      income pursuant to the Plan.

    

    
      	
              13.3

            	
              No
                Employment Contract.
                Nothing contained herein shall be construed to constitute a contract
                of
                employment between an Employee and the Company, an Affiliate, or
                any of
                the Company’s subsidiaries or affiliated
                companies.

            

    

    

    
      	
              13.4

            	
              Notice.
                Any notice or filing required or permitted to be delivered to the
                Plan
                Administrator under this Plan shall be delivered in writing, in person,
                or
                through such electronic means as is established by the Plan Administrator.
                Notice shall be deemed given as of the date of delivery or, if delivery
                is
                made by mail, as of the date shown on the postmark on the receipt
                for
                registration or certification. Written transmission by mail shall
                be sent
                to the Company or any Affiliate by certified mail
                to:

            

    

    

    

    FPIC
      INSURANCE GROUP, INC

    ATTN:
      GENERAL COUNSEL

    225 WATER
      STREET, SUITE 1400

    JACKSONVILLE,
      FLORIDA 32202

    

    Any
      notice or filing required or permitted to be given to a Participant under this
      Plan shall be sufficient if in writing or hand-delivered, or sent by mail to
      the
      last known address of the Participant.

    

    
      	
              13.5

            	
              Headings.
                The headings of Sections are included solely for convenience of reference,
                and if there is any conflict between such headings and the text of
                this
                Plan, the text shall control. 

            

    

    
      
        Page 26
          of 29

        
        

      

      
        
        

        
        

      

      
        
        

        FPIC
          Insurance Group, Inc. 2005 Deferred Compensation
          Plan

      

    

    

    
      	
              13.6

            	
              Invalid
                or Unenforceable Provisions.
                If any provision of this Plan shall be held invalid or unenforceable,
                such
                invalidity or unenforceability shall not affect any other provisions
                hereof and the Plan Administrator may elect in its sole discretion
                to
                construe such invalid or unenforceable provisions in a manner that
                conforms to applicable law or as if such provisions, to the extent
                invalid
                or unenforceable, had not been
                included.

            

    

    

    
      	
              13.7

            	
              Governing
                Law.
                To the extent not preempted by ERISA, the laws of the state in which
                the
                Company maintains its principal place of business shall govern the
                construction and administration of the
                Plan.

            

    

    

    

    

    IN
      WITNESS WHEREOF,
      the undersigned executed this Plan as of the 9th
      day of March, 2007 to be effective as of the Effective
      Date.

    

    

    FPIC
      Insurance Group, Inc.

    

    By:
      Pamela
      D. Harvey            (Print
      Name)

    

    Its:
      Vice
      President and Controller     (Title)

     

    

    /s/
      Pamela D. Harvey              (Signature)

    

    

    

    CORP\1223588.2

     

     

    
      
        Page 27
          of 29Unassociated Document

    STOCK
      PURCHASE AGREEMENT

     

    dated
      as
      of

     

    January
      25, 2007

     

    between

     

    QUANTUM
      CARGI & AVIATION SERVICES, INC.

     

    and

     

    HARVARD
      HOLDINGS INTERNATIONAL, INC.

     

    relating
      to the purchase and sale

     

    of

     

    39%
      of
      the Common Stock

     

    of

     

    QUANTUM
      CARGO & AVIATION SERVICES, INC.

    

    
      
         

      

      
         

        
          

        

      

      
         

        
        

      

    

     

    STOCK
      PURCHASE AGREEMENT

     

    THIS
      STOCK PURCHASE AGREEMENT (this "Agreement") is dated as of January 25, 2007,
      by
      and between HARVARD HOLDINGS INTERNATIONAL, INC. a Delaware corporation
      ("Buyer") and QUANTUM CARGO & AVIATION SERVICES, INC. a Florida corporation
      ("Seller").

     

    WITNESSETH

     

    WHEREAS,
      Seller, is the beneficial owner of the Shares (as defined herein) and desires
      to
      sell the Shares to Buyer, and Buyer desires to purchase the Shares from Seller,
      upon the terms and subject to the conditions hereinafter set forth.

     

    The
      parties hereto agree as follows:

     

    ARTICLE
      1

     

    DEFINITIONS

     

    Section
      1.01. Definitions.
      (a)
      The
      following terms, as used herein, have the following meanings:

     

    "Affiliate""
      means, with respect to any Person, any other Person directly or
      indirectly controlling, controlled by or under common control with such
      Person.

     

    "Affiliated
      Group" means, with respect to federal income Taxes, any affiliated group of
      corporations (as defined in Section 1504(a) of the Code) of which the Company
      are members and, with respect to any state, local or foreign income, franchise
      or similar income-based Tax, the consolidated, combined or unitary group of
      which the Company is a member.

     

    "Balance
      Sheet" means the unaudited balance sheet of the Company as of the Balance Sheet
      Date.

     

    "Balance
      Sheet Date" means December 31st,
      2006.

     

    "Business"
      means the business and operations of the Company as such are
      conducted by the Company as of the date hereof

     

    "Business
      Day" means a day, other than Saturday, Sunday or other clay on
      which
      commercial banks in New York, New
      York
      are
      required by law to close.

     

    "Common
      Stock" means the common stock, par value $1.00 per share, of the
      Company.

     

    "Company"
      means QUANTUM
      CARGO & AVIATION SERVICES, INC.,
      a
      Florida corporation.

    

    
      
         

      

      
         

        
          

        

      

      
         

        
        

      

    

     

    "Company
      Intellectual Propcrty Rights" means all Intellectual Property Rights owned
      by,
      or licensed to, the Company.

     

    "Current
      Assets" means the sum of the Company's:

     

    (x) Accounts
      Receivable, net of the Allowance for Doubtful Accounts,

     

    (y) Spare
      Parts and Supplies; and

     

    (z) Prepaid
      Expenses.

     

    For
      the
      avoidance of doubt, the parties agree that "Current Assets" shall not include
      any amounts included in Closing Cash.

     

    "Current
      Liabilities" means the sum of the Company's:

     

    (w) Payables,

     

    (x) Accrued
      Salaries and Vacation Pay,

     

    (y) Accrued
      Liabilities, and

     

    (z) Accrued
      'faxes.

     

    "ERISA"
      means the Employee Retirement Income Security Act of 1974, as amended and the
      rules and regulations promulgated thereunder.

     

    "ERISA
      Affiliate" means any other entity. which would be treated as a single employer
      with the Company under Section 414 of the Code.

     

    "Exchange
      Act" means the Securities Exchange Act of 1934, as amended, and the rules and
      regulations promulgated thereunder.

     

    "GAAP"
      means generally accepted accounting principles in the United
      States.

     

    "Governmental
      Authority" shall mean any federal, state, local or foreign government or any
      subdivision, agency, instrumentality, authority, department, commission, board
      or bureau thereof or any federal, state, local or foreign court, tribunal or
      arbitrator.

     

    "Intellectual
      Property Right" means any trademark, service mark, trade name, invention,
      patent, trade secret, copyright, - know how (including any registrations or
      applications for registration of any of the foregoing) or any other similar
      type
      of proprietary intellectual property right.

     

    "Laws"
      means any law, regulation, rule, order, judgment or decree of a Governmental
      Authority.

    

    
      
         

      

      
         

        
          

        

      

      
         

        
        

      

    

    "Lien"
      means, with respect to any property or asset, any and all liens, encumbrances,
      charges, security interests, options, mortgages, easements or pledges in respect
      of such property or asset.

     

    "Permitted
      Liens" mean: (i) specific Liens reflected or reserved against in the Balance
      Sheet or disclosed in the notes thereto; (ii) Taxes and general and special
      assessments not in default and payable without penalty or interest or being
      contested in good faith; (iii) mechanic's, materialman's, carrier's, repairer's
      and other similar Liens arising or incurred in the ordinary course of business
      or that are not yet due and payable or are being contested in good faith; or
      (iv) Liens arising or incurred in the ordinary course of business since the
      Balance Sheet Date, which individually or in the aggregate do not have a Company
      Material Adverse Effect.

     

    "Person"
      means an individual, corporation, partnership, limited liability company,
      association, trust or other entity or organization, including a government
      or
      political subdivision or an agency or instrumentality thereof.

     

    "Real
      Property" means all real property that is owned or leased by the
      Company.

     

    "SEC"
      means the Securities and Exchange Commission.

     

    "Securities
      Act" means the Securities Act of 1933, as amended, and the rules and regulations
      promulgated thereunder.

     

    "Shares"
      means 1,950 shares of Common Stock of Quantum Cargo & Aviation Services
      inc.

     

    "Tax"
      means any federal, state, local or foreign income, gross receipts, license,
      payroll, employment, excise, severance, stamp, occupation, premium, windfall
      profits, environmental, unemployment, disability, real property, personal
      property, sales, use, transfer, registration, value added, alternative or add-on
      minimum, estimated or other tax of any kind whatsoever

     

    "Tax
      Audit" shall mean any notice of deficiency, proposed adjustment, adjustment,
      assessment, audit, examination or other administrative or court proceeding,
      suit, dispute or other claim regarding Taxes.

     

    "Tax
      Return" means any return, declaration, report, claim for refund or information
      return or statement relating to Taxes, including any schedule or attachment
      thereto, and including any amendment thereof

     

    `Taxing
      Authority means any governmental authority (domestic or foreign) responsible
      for
      the imposition of any Tax.

    

    
      
         

      

      
         

        
          

        

      

      
         

        
        

      

    

     

    "Transportation
      Code" means 49 U.S.C. subtitl e VIII, as amended, and any successor statute
      thereto and the Federal Aviation Regulations issued or promulgated pursuant
      thereto.

     

    Section
      1.02. Other
      Definitional and Interpretative Provisions. Unless
      specified otherwise, in this Agreement the obligations of any party consisting
      of more than one Person are joint and several. The words "hereof"', "herein"
      and
      "hereunder" and words of like import used in this Agreement shall refer to
      this
      Agreement as a whole and not to any particular provision of this Agreement.
      The
      captions herein are included for convenience of reference only and shall be
      ignored in the construction or interpretation hereof. References to Articles,
      Sections, Exhibits and Schedules are to Articles, Sections, Exhibits and
      Schedules of this
      Agreement
      unless otherwise specified. All Exhibits and Schedules annexed hereto or
      referred to herein are hereby incorporated in and made a part of this Agreement
      as if set forth in full herein. Any capitalized terms used in any Exhibit or
      Schedule but not otherwise defined therein shall have the meaning as defined
      in
      this Agreement. Any singular term in this Agreement shall be deemed to include
      the plural, and any plural term the singular. Whenever the words "include,"
      "includes" or "including" are used in this Agreement, they shall be deemed
      to be
      followed by the words "without limitation," whether or not they are in fact
      followed by those words or words of like import. "Writing," "written" and
      comparable terms refer to printing, typing and other means of reproducing words
      (including electronic media) in a visible form. References to any Person include
      the successors and permitted assigns of that Person. References from or through
      any date mean, unless otherwise specified, from and including or through and
      including, respectively.

     

    ARTICLE
      2

     

    PURCHASE
      AND SALE

     

    Section
      2.01. Purchase
      and Sale. (a)
      Upon
      the terms and subject to the conditions of this Agreement, Seller agrees to
      sell
      to Buyer and Buyer agrees to purchase from Seller, 39% of the total equity
      shares of the Company. The purchase
      price (the "Purchase
      Price") is $200,000 (two hundred thousand dollars) payable as per outlined
      in
      Exhibit 1, and consisting of $100,000 in cash and S100,000 in the common stock
      of the Purchaser (200,000 shares at a price of $0.50 per share).

     

    Section
      2.02. Closing.
      Upon
      mutual execution of this document via electronic counterparts with original
      copies to follow

     

    (a)
      Buyer
      shall deliver to Seller the Purchase Price as outlined in Exhibit

    

    
      
         

      

      
         

        
          

        

      

      
         

        
        

      

    

     

    (b)
      Seller shall deliver to Buyer certificates for° the Shares duly endorsed or
      accompanied by stock powers duly endorsed in blank, with any required transfer
      stamps affixed thereto.

     

    ARTICLE
      3

     

    REPRESENTATIONS
      AND WARRANTIES OF TEIE SELLERS

     

    Seller
      makes the following representations and warranties to Buyer with respect to
      the
      Company as of the date hereof (except to the extent expressly relating to a
      specific date, in which event such representation or warranty shall be made
      as
      of such date), which shall be unaffected by any investigation heretofore or
      hereafter made by or on behalf of Buyer:

     

    Section
      3.01. Corporate
      Existence and Power. The
      Company is a corporation duly incorporated, validly existing and in good
      standing under the laws of its jurisdiction of incorporation and has all
      corporate powers required to carry on its business as now
      conducted.

     

    Section
      3.02. Corporate
      Authorization and Binding Effect. The
      execution, delivery and performance by Seller of this Agreement, and the
      consummation by each of the Sellers and the Company of the transactions
      contemplated hereby and thereby have been duly authorized by all necessary
      corporate and shareholder action by each of the Sellers and the Company. Seller
      and the Company has full power and authority to execute and deliver this
      Agreement and to perform its obligations hereunder. This Agreement and each
      Related Agreement to which it is a party has been duly executed and delivered
      by
      Seller and the Company and, assuming due and valid authorization, execution
      and
      delivery thereof by Buyer, this Agreement is a valid and binding obligation
      of
      Seller and the Company party thereto, enforceable in accordance with its terms
      and conditions.

     

    Section
      3.03. Governmental
      Authorization. The
      execution, delivery and performance by the Seller of this Agreement and the
      consummation by the Seller of the transactions contemplated hereby require
      no
      action by or in respect of, or filing with, any Governmental
      Authority.

     

    Section
      3.04. Noncontravention.
      The
      execution, delivery and performance by the Seller of this Agreement and the
      consummation by Seller and the Company of the transactions contemplated hereby
      and thereby do not and will not (i) contravene or conflict with the certificates
      or articles of incorporation or bylaws
      of
      the Seller or the Company; (ii) contravene or conflict with or
      constitute
      a
      violation of any provision of any Law binding upon or applicable to the Seller
      or the Company or any of their respective properties or assets; (iii) result
      in
      a violation or a breach of, or constitute a default or require any consent
      under
      or give rise to a right of termination, cancellation or acceleration of any
      right or obligation of the Company or to a loss of any benefit to which the
      Company is entitled under any provision of any note, bond, mortgage, indenture,
      lease, agreement, contract, obligation or other instrument to which the Company
      is bound, or any license, franchise, permit or other similar authorization
      held
      by the Company; or (iv) result in the creation or imposition of any Lien on
      any
      asset of the Company, except for any Permitted Liens.

     

    
      
         

      

      
         

        
          

        

      

      
         

        
        

      

    

     

     

    Section
      3.05. Capitalization.
      The
      authorized capital stock of the Company consists of 5,000 (five thousand) shares
      of Common Stock. There are outstanding 5,000 (five thousand) shares of Common
      Stock. All outstanding shares of capital stock of the Company are duly
      authorized, validly issued, fully paid, nonassessable and free from preemptive
      rights. Except as set forth in this Section 3.05, there are no outstanding
      (i)
      shares of capital stock or other voting securities of or other ownership
      interests in the Company; (ii)) securities of the Company convertible into
      or
      exchangeable for shares of capital stock or voting securities of or other
      ownership interests in the Company; or (iii) options or other rights to acquire
      from the Company, or any obligation of the Company to issue, transfer or sell,
      any capital stock or voting securities of or other ownership interests in the
      Company or securities convertible into or exchangeable for capital stock or
      voting securities of or other ownership interests in the Company (the items
      in
      clauses (i), (ii) and (iii) being referred to collectively as the "Company
      Securities").
      There are no outstanding obligations of the Company to repurchase, redeem or
      otherwise acquire any Company Securities. The Company does not have any
      Subsidiaries.

     

    Section
      3.06.
      Ownership of Shares. Seller
      is
      the record and beneficial owner of the Shares, free and clear of any
      Lien,
      and
      will transfer and deliver to Buyer at the Closing valid title to the Shares,
      free and clear of any Lien

     

    Section
      3.07. Permits;
      Compliance. (a)
      The
      Company is in possession of all franchises, grants, authorizations, licenses,
      permits, easements, variances, exceptions, consents, certificates, approvals,
      clearances and orders of any Governmental Authority necessary for the Company
      to
      operate its repair and manufacturing business as currently conducted, to own,
      lease and operate its properties and to carry on the Business (the "Company
      hermits") and the use and operation by' the Company of its properties and the
      conduct of the Business comply with the requirements and conditions of all
      Company Permits.

     

    
      (b)
        All
        of the Company Permits are valid and in full force and effect. 'fo the Knowledge
        of Seller, no suspension, cancellation or limitation of any of the Company
        Permits is threatened.

    

    

     

    
      
        
          

        

         

      

      
         

        
          

        

      

      
         

        
        

      

    

     

    (c)
      A
      certificate of calibration or compliance for each tooling of the Company has
      been duly issued pursuant to relevant federal aviation laws and is in full
      force
      and effect. Each tool owned by the Company is duly registered in the name of
      the
      Company in accordance with federal aviation laws. Each tool or machinery used
      by
      the Company but owned by a third party is duly registered in the name of such
      third party in accordance with all applicable federal aviation laws and the
      Company is authorized to use such tool under all applicable federal aviation
      laws.

     

    Section
      3.08. Financial
      Statements. (a)
      The
      unaudited consolidated balance sheets of the Company as of December 31, 2006,
      and the related unaudited consolidated statements of income, cash flows and
      stockholders equity for each of the years ended December 31, 2005 and 2004
      (collectively, the "Financial Statements"), the financial position of the
      Company as of the dates thereof and their consolidated results of operations,
      cash flows and stockholders equity for the periods then ended.

     

    Section
      3.09. Books
      and Records. The
      books
      of account, minute books and stock record books of the Company are complete
      and
      correct in all material respects and have been maintained in accordance with
      reasonable and customary business practices. The minute books of the Company
      contain records that are complete and correct in all material respects of all
      meetings of, and corporate action taken by (including all actions by unanimous
      written consent), the shareholders and directors of the Company since August
      13,
      2002, True and complete copies of all minute books and all stock record books
      of
      the Company have heretofore been made available to Buyer.

     

    Section
      3.10. Absence
      of Certain Changes. The
      Company has conducted its business in the ordinary course consistent with past
      practices and there has not been:

     

    (a) any
      event, occurrence or development which has had a Company Material Adverse
      Effect;

     

    (b) any
      declaration, setting aside or payment of any dividend or other distribution
      with
      respect to any shares of capital stock of the Company, or any repurchase,
      redemption or other acquisition by the Company of any outstanding shares of
      capital stock or other securities of, or other ownership interests in, the
      Company;

     

    (c) any
      amendment of any material term of any outstanding security of the
      Company;

     

    (d) any
      incurrence, assumption, amendment or guarantee by the Company of any
      indebtedness for borrowed money, or any foreign currency, hedging, financial
      derivatives or similar transactions, other than in the ordinary course of
      business and consistent with past practices;

    

    
      
         

      

      
         

        
          

        

      

      
         

        
        

      

    

     

    (e) any
      creation or assumption by the Company of any Lien, other than Permitted Liens,
      on any asset of the Company;

     

    (f) (i)
      any
      making of any loan, advance or capital contribution to or investment in any
      Person by the Company other than loans, advances, capital contributions or
      investments made in the ordinary course of business consistent with past
      practices or (ii) any amendment of the terms of any loan to executive officers
      or directors;

     

    (g) any
      transaction or commitment made, or any contract or agreement entered into,
      by
      the Company relating to its assets or the Business (including the acquisition
      or
      disposition of any assets), in either ease, material to the Company, other
      than
      transactions and commitments in the ordinary course of business consistent
      with
      past practices and those contemplated by this Agreement;

     

    (h) any
      material change in any method of accounting or accounting practice by the
      Company.

     

    (i) any
      payment, discharge or satisfaction of any material claim, liability or
      obligation, except in the ordinary course of business or pursuant to the terms
      of any Material Contract;

     

    (j) any
      material modification to a Material Contract;

     

    (k) except
      as
      required under applicable law or pursuant to existing agreements, any (i) grant
      of any severance or termination pay to any director, officer or employee of
      the
      Company, (ii) increase in compensation, bonus or other benefits payable under
      any severance or retirement or termination pay policies of the Company, (iii)
      entering into of any employment, deferred compensation or other similar
      agreement (or any amendment to any such existing agreement) with any director,
      officer or employee of the Company or (iv) adoption of any new Employee Plan
      or
      modification of any Employee Plan, in the case of each of clauses (i) through
      (iv), other than in the ordinary course of business consistent with past
      practices; or

     

    (1)
      any
      disposal or lapse of any rights to the use of any Intellectual Property Right,
      which would have a Company Material Adverse Effect.

     

    Section
      3.11. No
      Undisclosed Material Liabilities. There
      are
      no liabilities or obligations of the Company of any kind, other
      than:

     

    (a) liabilities
      or obligations disclosed or provided for in the Balance Sheet or the notes
      thereto;

     

    (b) liabilities
      or obligations incurred in the ordinary course of business since the Balance
      Sheet Date;

     

    (c) liabilities
      or obligations under this Agreement; and

    

    
      
         

      

      
         

        
          

        

      

      
         

        
        

      

    

     

    (d) other
      liabilities or obligations which in the aggregate would not have a Company
      Material Adverse .Effect.

     

    Section
      3.12. Litigation.
      As
      of the
      date of this Agreement, there is no judicial or administrative action, suit
      or
      proceeding pending, or to the Knowledge of Seller, threatened against the
      Company or relating to the Business, any of the Company's properties or any
      of
      the officers or directors of such companies before any court or arbitrator
      or
      before or by any Governmental Authority that would, individually or in the
      aggregate, have a Company Material Adverse Effect. The Company is not subject
      to
      any judgment, order or decree that would result in a Company Material Adverse
      Effect.

     

    Section
      3.13. Taxes.
      (a)
      The
      Company will also separately file all material Tax Returns that it is required
      to file for each taxable period. All such Tax Returns will be filed, correct
      and
      complete in all material respects and will be prepared in substantial compliance
      with all applicable laws and regulations. The Company will pay all material
      Taxes shown or required to be shown on such separate Tax Returns.

     

    (b) There
      are
      no Liens for Taxes (other than Taxes not yet due and payable) upon any of the
      assets of the Company.

     

    (c) The
      Company has withheld and paid all employment, sales, use and other Taxes
      required to have been withheld and paid in connection with any amounts paid
      or
      owing to any employee, independent contractor, creditor or other third
      party.

     

    (d) There
      is
      no pending or any threatened dispute or claim concerning any material Tax
      liability of the Company for any taxable period during which the Company was
      a
      member of the Seller's Affiliated Group.

     

    Section
      3.14. Employee
      Plans. The
      company has provided the Buyer with all information regarding employee
      compensation plans.

     

    (a) The
      Company does not presently sponsor, maintain or contribute to, and has not
      in
      the past sponsored, maintained or contributed to, or agreed to sponsor, maintain
      or contribute to, any Pension Plan.

     

    (b) .Labor
      Matters. at the date of this Agreement:

     

    (i) there
      are
      no controversies pending or threatened between the Company and any of its
      employees;

     

    (ii) the
      Company has not breached in any material respect or otherwise failed to comply
      in any material respect with any provision of any Collective Bargaining
      Agreement applicable to persons employed by the Company, nor has any such breach
      or failure been alleged, and there are no material grievances outstanding
      against the Company thereunder;

    

    
      
         

      

      
         

        
          

        

      

      
         

        
        

      

    

     

    (iii) there
      is
      no petition pending before the National Mediation Board seeking certification
      or
      any change in certification of a labor representative with respect to any craft
      or class of employees of the Company;

     

    (iv) there
      is
      no strike, slowdown, work stoppage, labor action or lockout or threat thereof,
      by or with respect to any employees of the Company; and

     

    (v) there
      is
      no complaint for violation of the Railway Labor Act, 45 U.S.C. § 8, as amended,
      against the Company pending before any Governmental Authority.

     

    Section
      3.15. Certain
      Business Practices. Neither
      the Company nor any of its directors, officers employees or any other person
      authorized to act on behalf of the Company has used any corporate funds for
      unlawful contributions, gifts, entertainment or other unlawful expenses relating
      to political activity, made any unlawful payment to foreign or domestic
      government officials or employees or to foreign or domestic political parties
      or
      campaigns from corporate funds, violated any provision of the Foreign Corrupt
      Practices Act of 1977, as amended, or made any bribe, rebate, payoff, influence
      payment, kickback or other similar unlawful payment to any foreign or domestic
      government official or employee from corporate funds.

     

    Section
      3.16. Environmental
      Matters. (a)
      Except as to matters that would not have a Company Material Adverse
      Effect:

     

     

    (i) no
      complaint has been filed, no penalty has been assessed, and no third-party
      investigation, claim, suit, proceeding or review is pending or is threatened
      by
      any Governmental Authority or other Person against the Company and, in each
      case, alleging or relating to any violation by the Company of any Environmental
      Law;

     

    (ii) the
      Company is in compliance with all Environmental Laws and has obtained and is
      in
      compliance with all permits, licenses, franchises, certificates, approvals
      and
      other similar authorizations of any Governmental Authority (collectively,
      "Environmental Permits") required by I nvironmental taws to conduct the
      Business;

     

    Compliance
      With Laws and Court Orders. The
      Company is. in

    compliance
      with all, and is not under investigation with respect to applicable
      Laws.

     

    Section
      3.17. Employee
      Matters. The
      Company is in compliance in all material respects with all applicable Laws
      respecting employment and employment practices, terms, and conditions of
      employment, and wages and hours and is not engaged in any unfair labor
      practice.

    

    
      
         

      

      
         

        
          

        

      

      
         

        
        

      

    

     

    Section
      3.18. Title
      to Assets; Liens. The
      Company has good title to all the properties and assets reflected in the Balance
      Sheet and all assets purchased by the Company since the Balance Sheet Date
      free
      and clear of all Liens (other than Permitted Liens). At the time of the Closing,
      the assets of the Company, taken together with the rights and benefits to Buyer
      arising under the Related Agreements, shall be adequate in all
      material
      respects to allow Buyer at such time to conduct the Business substantially
      as it
      is currently being conducted.

     

    Section
      3.19.
      Real
      Property. (a)
      True
      and correct copies of all leases affecting the Real Property have been made
      available to Buyer. There are no proceedings, claims, disputes, or conditions
      affecting any Real Property that would reasonably be expected to materially
      interfere with the Company's use of such property, whether before or after
      the
      Closing Date, for the conduct of the Business as currently being conducted.
      Neither the whole nor any portion of the Real Property is subject to any
      governmental decree or order to be sold or is being condemned, expropriated,
      or
      otherwise taken by any public authority, nor to the Knowledge of Seller has
      any
      such condemnation, expropriation, or taking been proposed. All Real Property
      is
      leased free and clear of all Liens on such leasehold interests other than
      Permitted Liens.

     

    (b)
      To
      Seller's Knowledge, there is no structural defect in any of the Real Property
      or
      the improvements thereon.

     

    Section
      3.20. Material
      Contracts. (a)
      7be
      Company is not a party to or bound by:

     

    (i)  any
      airport lease or lease of real property providing for annual rentals of $30,000
      or more;

     

    (ii) 
      any
      agreement for the purchase of materials, supplies, goods, services, equipment
      or
      other assets (other than pursuant to purchase orders made in the ordinary course
      of business consistent with past practice) providing for annual payments by
      the
      Company of $50,000 or more;

     

    (iii) 
      any
      capacity purchase, alliance or similar agreement with another airline or
      repair/manufacturing facility relating to the operation of the Company's tooling
      for
      the
      benefit of such other airline or repair facility that will not be terminated
      on
      or prior to Closing;

     

    (iv)  any
      material partnership, joint venture or other similar agreement or
      arrangement;

     

    (v) 
      any
      agreement relating to indebtedness for borrowed money or the deferred purchase
      price of property (in either case, whether incurred, assumed, guaranteed or
      secured by any asset), except any such agreement with an aggregate outstanding
      principal amount not exceeding $100,000;

    

    
      
         

      

      
         

        
          

        

      

      
         

        
        

      

    

     

    (vi) any
      agreement that limits in any material respect the freedom of the Company to
      compete in any line of business, with any Person or in any area for any length
      of time;

     

    (vii) any
      contract or commitment requiring, after the date hereof, the mortgage, pledge,
      sale, or disposal of assets with a value in excess of $100,000 or release,
      grant, or transfer of Company rights with a value in excess of $100,000;
      or

     

    (b)
      Each
      agreement, contract, plan, lease, arrangement or commitment required to be
      disclosed pursuant to this Section (collectively, "Material Contracts") is
      a
      valid and binding agreement of the Company and is in full force and effect,
      and
      none of the Company or, to the Knowledge of Seller, any other party thereto
      is
      in default or breach in any respect under the terms of any such agreement,
      contract, plan, lease, arrangement or commitment.

     

    Section
      3.21. Insurance.
      Seller
      has made available to Buyer copies of all insurance policies providing coverage
      in favor of the Company or any of its properties, including "all risk" insurance
      policies (collectively, the "Insurance Policies"). There are no material claims
      by the Company pending under any of the Insurance Policies as to which coverage
      has been questioned, denied or disputed by the underwriters of such policies
      or
      in respect of which such underwriters have reserved their rights. As of the
      date
      hereof, all Insurance Policies are in full force and effect, all premiums due
      thereon have been paid and the Company is in compliance in all material respects
      with the terms and provisions of the Insurance Policies.

     

    Section
      3.22. Intellectual
      Properly. (a)
      No
      Company Intellectual Property
      Right is subject to any outstanding judgment, injunction, order, decree
      or
      agreement restricting the use thereof by the Company or restricting the
      licensing thereof by the Company to any Person.

     

    (b)
      Except as expressly disclosed to Buyer, the Company has the sole and exclusive
      right to use the Company Intellectual Property Rights, and no consent of any
      third party is required for the use thereof by the Company following Closing.
      To
      the Knowledge of Seller, no claims have been asserted by any person challenging
      the use of any Company Intellectual :Property Rights, or challenging or
      questioning the validity or effectiveness of any such license or agreement.
      No
      additional Intellectual Property Rights other than the Company Intellectual
      Property Rights are necessary or material to the conduct of the
      Business.

     

    

    

    
      
         

      

      
         

        
          

        

      

      
         

        
        

      

    

    ARTICLE
      4

     

    REPRESENTATIONS
      AND WARRANTIES OF BUYER

     

    Buyer
      hereby makes the following representations and warranties to the Sellers as
      of
      the date hereof (except to the extent expressly relating to a specific date,
      in
      which event such representation or warranty shall be made as of such date),
      which shall be unaffected by any investigation heretofore or hereafter
      made.

     

    Section
      4.01. Corporate
      Existence and Power. Buyer
      is
      a corporation duly incorporated, validly existing and in good standing under
      the
      laws of its jurisdiction of incorporation and has all corporate powers required
      to carry on its business as now conducted.

     

    Section
      4.02. Corporate
      Authorization. The
      execution, delivery and performance by Buyer of
      this
      Agreement and each Related Agreement to which it is a party and the consummation
      by Buyer of the transactions contemplated hereby and thereby have been duly
      authorized by all necessary corporate and shareholder action by Buyer. Buyer
      has
      full power and authority to execute and deliver this Agreement and to perform
      its obligations hereunder. This Agreement has been duly executed and delivered
      by Buyer and, assuming due and valid authorization, execution and delivery
      thereof by each Seller party thereto, this Agreement is a valid and binding
      obligation of Buyer, enforceable in accordance with its terms and
      conditions.

     

    Section
      4.03: Governmental
      Authorization. The
      execution, delivery and performance by Buyer of
      this
      Agreement and each Related Agreement and the consummation by Buyer of the
      transactions contemplated hereby and thereby require no action by or in respect
      of, or filing with, any Governmental Authority

     

    Section
      4.04. Noncontravention.
      The
      execution, delivery and performance by Buyer of this Agreement and the
      consummation by Buyer of the transactions contemplated hereby do not and will
      not (i) contravene or conflict with the articles of incorporation or bylaws
      of
      Buyer, (ii) assuming compliance with the matters referred to in Section 4.03,
      contravene or conflict with or constitute a violation of any provision
of
      any
      Law
      binding upon or applicable to Buyer, (iii) result in a violation or a breach
      of,
      or constitute a default or require any consent under or give rise to a right
      of
      termination, cancellation or acceleration of any right or obligation of Buyer
      or
      to a loss of any benefit to which Buyer is entitled under any provision of
      any
      note, bond, mortgage, indenture, lease, agreement, contract, obligation or
      other
      instrument to which Buyer is bound, or any license, permit or other similar
      authorization held by Buyerj.

     

    Section
      4.05. Litigation.
      As of
      the
      date of this Agreement, there is no judicial or administrative action, suit
      or
      proceeding pending, or to the knowledge of Buyer, threatened against Buyer
      before any Governmental Authority which in any
      manner challenges or seeks to prevent, enjoin, alter or materially delay the
      transactions contemplated by this Agreement.

    

    
      
         

      

      
         

        
          

        

      

      
         

        
        

      

    

     

     

    ARTICLE
      5

     

    COVENAN'rs
      OF
      TtIE
      SELLERS

     

    Each
      of
      the Sellers agrees that:

     

    Section
      5.01. Conduct
      of the Company. Except
      as
      expressly contemplated by this Agreement or as otherwise consented to by Buyer
      in writing, during the period from the date hereof and continuing, each of
      the
      Sellers shall cause the Company to:

     

    (a) conduct
      its business in the usual, regular and ordinary course consistent with past
      practices;

     

    (b) not
      mortgage, pledge, sell or dispose of any assets with a value of $3,000 or more
      in the aggregate, and not waive, release, grant, transfer or permit to lapse
      any
      Company rights of value in excess of $5,000 in the aggregate;

     

    (c) comply
      in
      all material respects with all provisions of any Material Contracts to which
      the
      Company is a party;

     

    (d) not
      take
      any action that would result in the representation set forth in Section 3.10(k)
      being untrue;

     

    (e) not
      enter
      into any new or amended contract, agreement, side letter or memorandum of
      understanding with any unions representing employees of the
      Company;

     

    (t)
      not
      enter into any agreement or understanding with any other Person outside of
      the
      ordinary course of business consistent with past practices involving
      expenditures in excess of $3,000 in the aggregate or involving terms of duration
      or commitments in excess of 3 months;

     

    (g) not
      enter
      into any agreement or understanding with any other Person containing any
      exclusivity, non-competition or similar provisions that would materially
      restrict the ability of the Company to compete;

     

    (h) not
      adopt
      or propose any change in its organizational documents (including bylaws);
      and

     

    (i)
      not
      merge or consolidate with any other Person. Section 5.02. Access
      to Information; Confidentiality.

    

    
      
         

      

      
         

        
          

        

      

      
         

        
        

      

    

     

    (a) After
      the
      Closing, Seller will hold, and will use their best efforts to cause their
      respective officers, directors, employees, accountants, counsel, consultants,
      advisors and agents to hold, in confidence, unless compelled to disclose by
      judicial or administrative process or by other requirements of law, all
      confidential documents and information concerning the Company, except to the
      extent that such information can be shown to have been (i) previously known
      on a
      nonconfidential basis by either Seller, (ii) in the public domain through no
      fault of Sellers or their Affiliates or (iii) later lawfully acquired by any
      Seller from sources other than those related to its prior ownership of the
      Company. The obligation of Sellers and their Affiliates to hold any such
      information in confidence shall be satisfied if they exercise the same care
      with
      respect to such information as they would take to preserve the confidentiality
      of their own similar information.

     

    (b) On
      and
      after the Closing Date, Seller will afford, promptly to Buyer and its agents
      reasonable access to its books of account, financial and other records
      (including accountant's work papers), information, employees and auditors to
      the
      extent reasonably necessary for Buyer in connection with any audit,
      investigation, dispute or litigation (other than any dispute or litigation
      involving either of the Sellers) relating to the Business; provided
      that
      any
      such access by Buyer shall be conducted during normal business hours and shall
      not unreasonably interfere with the conduct of the business of the Sellers,
      Buyer shall bear all of the out-of-pocket costs and expenses (including
      reasonable attorneys' fees, but excluding reimbursement of Seller for general
      overhead, salaries and employee benefits) reasonably incurred in connection
      with
      the foregoing.

     

    Section
      5.03. Notices
      of Certain Events. From
      the
      date hereof, Seller shall promptly notify Buyer of:

     

    (a) any
      actions, suits, claims, investigations or proceedings (i) commenced against
      the
      Company or (ii) in respect of which the Company has an indemnification
      obligation and as to which Seller has Knowledge that, if pending on the date
      of
      this Agreement, would have been required to have been disclosed pursuant to
      Section 3.12;

     

    (b) any
      material agreement or litigation, or consent or order of the FAA or
      D0"1,,
      related
      to the Company (other than those that apply generally to air carriers or
      companies in the airline industry); and

     

    (c) any
      incidents or accidents occurring on or after the date hereof involving any
      property owned or operated by the Company that has resulted or would reasonably
      be expected to result in casualty damages or losses in excess of
      $20,000.

     

    

    

    
      
         

      

      
         

        
          

        

      

      
         

        
        

      

    

     

    ARTICIJE
      6

     

    COVENANTS
      OF BUYER

     

    Buyer
      agrees that:

     

    Section
      6.01. Confidentiality.
      Prior
      to
      the Closing Date and after any termination of this Agreement, Buyer and its
      Affiliates will hold, and will use their best efforts to cause their respective
      officers, directors, employees, accountants, counsel, consultants, advisors
      and
      agents to hold, in confidence all confidential documents and information
      concerning the Company furnished to Buyer or its Affiliates in connection with
      the transaction contemplated by this Agreement.

     

    Section
      6.02. I
      rademarks;
      Tradenames. Buyer
      shall not permit the Company to use any of the marks or names of Seller that
      the
      parties agree shall belong to Seller after closing.

     

    ARTICLE
      7

     

    COVENANTS
      OF BUYER AND THE SELLERS

     

    Buyer
      and
      the Sellers agree that:

     

    Section
      7.01. Best
      Efforts; Further Assurances. (a)
      Subject to the terms and conditions of this Agreement, Buyer and the Sellers
      will use their best efforts to take, or cause to be taken, all actions and
      to
      do, or cause to be done, all things necessary or desirable under applicable
      laws
      and regulations to consummate the transactions contemplated by this Agreement.
      Seller and Buyer shall, and the Sellers shall cause the Company prior to the
      Closing, and Buyer shall cause the Company after the Closing, to execute and
      deliver such other documents, certificates, agreements and other writings and
      to
      take such other actions as may be necessary or desirable in order to consummate
      or implement expeditiously the transactions contemplated by this
      Agreement.

     

    Section
      7.02. Public
      Announcements. The
      parties agree to consult with each other before issuing any press release or
      making any public statement with respect to this Agreement or the transactions
      contemplated hereby and, except for any press releases and public announcements
      the making of which may be required by applicable law or any listing agreement
      with any national securities exchange, will not issue any such press release
      or
      make any such public statement prior tosuch consultation..

     

    Section
      7.03 Operational
      Agreement. Both
      parties agree that within 90 days of closing an operational partnership
      agreement shall be in place, inclusive of employment agreements for principal
      officers of the Seller. Buyer and Seller have to date negotiated most of the
      terms of the agreement and will use their best faith efforts to complete and
      ratify said agreement. In the event of a failure to

    

    
      
         

      

      
         

        
          

        

      

      
         

        
        

      

    

     

    complete
      an agreement Seller retains the right to purchase the shares sold to the Buyer
      for an equal amount of consideration expended by the Buyer.

     

    ARTICLE
      8

     

    BMPI,OYEE
      BENEFITS

     

    Section
      8.01. Employee
      Benefits. (a)
      Nothing herein shall be construed to require the Company or Buyer to continue
      after Closing the employment of any Company employee or to otherwise interfere
      with the Company's right to terminate any such employees at any time after
      Closing.

     

    (b)
      Following the Closing Date, except to the extent otherwise prohibited by
      applicable law, each employee of the Company shall receive service credit for
      purposes of eligibility to participate and vesting (but not for benefit accrual
      purposes) for all periods of employment with the Company and its Affiliates
      and
      predecessors thereto prior to the Closing Date under any employee benefit plan
      of Buyer or its Affiliates in which such employee is eligible to participate
      after the Closing Date, to the extent such credit existed immediately prior
      to
      the Closing Date under the corresponding Employee Plan maintained by the
      Company.

     

    ARTICL1
      9

     

    CONDITIONS
      TO CLOSING

     

    Section
      9.01. Conditions
      to Obligations of Buyer and the Sellers. The
      obligations of Buyer and the Sellers to consummate the Closing are subject
      to
      the satisfaction of the following conditions:

     

    (a) no
      provision of any Law shall prohibit the consummation of the
      Closing;

     

    (b) there
      shall not be in effect any Law enacted, enforced, promulgated, issued or deemed
      applicable to the transactions contemplated hereby of any Governmental Authority
      that makes illegal or otherwise materially restrains or prohibits the
      consummation of the transactions contemplated hereby.

     

    Section
      9.02. Conditions
      to Obligation of Buyer. The
      obligation of Buyer to consummate the Closing is subject to the satisfaction
      of
      the following further conditions:

     

    (a)
      the
      Seller shall have performed or complied with in all material respects all of
      the
      covenants and agreements required to be performed by it on or prior to the
      Closing Date under this Agreement, and the representations and warranties of
      the
      Seller set forth in this Agreement shall be true at and as of the Closing Date
      as if made at and as of such time (except as to any representation or warranty
      which speaks as of a specific date, which must be true as of such
      date;

    

    
      
         

      

      
         

        
          

        

      

      
         

        
        

      

    

     

    (b) there
      shall not have occurred any Company Material Adverse Effect after the date
      hereof which is continuing on the Closing Date;

     

    (c) Buyer
      shall have received all documents it may reasonably request relating to the
      existence of the Seller and the authority of the Seller for this Agreement,
      all
      in form and substance reasonably satisfactory to Buyer; and

     

    Section
      9.03. Conditions
      to Obligation of the Sellers. The
      obligation of the Sellers to consummate the Closing is subject to satisfaction
      of the following further conditions.

     

    (a) Buyer
      shall have performed or complied with in all material respects all of the
      covenants and agreements required to be performed by it on or prior to the
      Closing Date under this Agreement, and the representations and warranties of
      Buyer set forth in this Agreement shall be true at and as of the Closing Date
      as
      if made at and as of such time (except as to any representation or warranty
      which speaks as of a specific date, which must be true as of such date);
      and

     

    (b) the
      Seller shall have received all documents it may reasonably request relating
      to
      the existence of Buyer and the authority of Buyer for this Agreement, all in
      form and substance reasonably satisfactory to the Sellers.

     

    ARTICLE
      10

     

    SURVIVAL;
      INDEMNIFICATION

     

    Section
      10.01. Survival.
      Except
      as
      specifically set forth below, the representations and warranties of the parties
      hereto contained in this Agreement or in any certificate or other writing
      delivered pursuant hereto or in connection herewith shall survive the Closing
      until the first anniversary of the Closing Date. The covenants and agreements
      of
      the parties hereto contained in this Agreement or in any certificate or other
      writing delivered pursuant hereto or in connection herewith shall survive the
      Closing indefinitely or for the shorter period explicitly specified therein,
      except that for such covenants and agreements that survive for such shorter
      period, breaches thereof shall survive indefinitely or until the latest date
      permitted by law. Notwithstanding the preceding sentences, any breach of
      representation, warranty, covenant or agreement in respect of which indemnity
      may be sought under this Agreement shall survive the time at which it would
      otherwise terminate pursuant to the preceding sentences, if notice of the
inaccuracy
      or breach thereof giving rise to such right of indemnity shall have
      been
      given to
      the party against whom such indemnity may be sought prior to such
      time.

     

    Section
      10.02. Indemni/icotion.
      (a)Effective
      at and after the Closing, Seller hereby indemnities Buyer and its Affiliates
      against and agrees to hold each of them harmless from any and all damage, loss
      and expense (including reasonable expenses of investigation and reasonable
      attorneys' fees and expenses and any fines or penalties imposed) actually
      suffered by Buyer or any of its Affiliates arising out of
      any misrepresentation or breach of representation or warranty (each such
      misrepresentation and breach, a "Warranty each") or breach of covenant or
      agreement made or to be performed by the Sellers pursuant to this
      Agreement.

    
      
         

      

      
         

        
          

        

      

      
         

        
        

      

    

    (b)
      Effective at and after the Closing, Buyer hereby indemnifies Seller and its
      Affiliates against and agrees to hold each of them harmless from any and all
      Damages actually suffered by Seller or any of its Affiliates arising out of
      any
      Warranty Breach or breach of covenant or agreement made or to be performed
      by
      Buyer pursuant to this Agreement.

     

    Section
      10.03. Procedures.
      (a)
      The
      party seeking indemnification under Section 10.02 (the "Indemnified Party")
      agrees to give prompt notice to the party against whom indemnity is sought
      (the
"Indemnifying
      Party") of the assertion of any claim, or the commencement of any suit, action
      or proceeding ("Claim") in respect of which indemnity may be sought under such
      Section and will provide the Indemnifying Party such information with respect
      thereto that the Indemnifying Party may reasonably request. The failure to
      so
      notify the Indemnifying Panty shall not relieve the Indemnifying Party of its
      obligations hereunder, except to the extent such failure shall have adversely
      affected the Indemnifying Party.

     

    (b) The
      Indemnifying Party shall be entitled to participate in the defense of any Claim
      asserted by any third party ("Third Party Claim") and, subject to the
      limitations set forth in this Section, shall be entitled to assume the control
      of and appoint lead counsel for such defense, in each case at its
      expense.j

     

    (c) If
      the
      Indemnifying Party shall assume the control of the defense of any Third Party
      Claim in accordance with the provisions of this Section 10.03, (i) the
      Indemnifying Party shall obtain the prior written'consent of the Indemnified
      Party (which shall not be unreasonably withheld, delayed or conditioned) before
      entering into any settlement of such Third Party Claim, but only if the
      settlement does not release the Indemnified Party from all liabilities and
      obligations with respect to such Third Party Claim or if the settlement imposes
      injunctive or other equitable relief against the Indemnified Party, and (ii)
      the
      Indemnified Party shall be entitled to participate in the defense of such Third
      Party Claim and to employ separate counsel of its choice for
      such
      purpose. The fees and expenses of such separate counsel shall be paid by the
      Indemnified Party. The Indemnifying Party shall have no indemnification
      obligations with respect to any Third Party Claim that shall be settled by
      the
      indemnified Party without the prior written consent of the Indemnifying Party,
      which consent shall not be unreasonably withheld, delayed or
      conditioned.

     

    (d) Each
      party shall cooperate, and cause their respective Affiliates to cooperate,
      in
      the defense or prosecution of any Third Party Claim and shall furnish or cause
      to be furnished such records, information and testimony, and attend such
      conferences, discovery proceedings, hearings, trials or appeals, as may
      be
      reasonably requested in connection therewith. The Indemnified Party shall keep
      the Indemnifying Party fully informed of the defense of any Third Party Claim
      conducted by such Indemnified Party.

    

    
      
         

      

      
         

        
          

        

      

      
         

        
        

      

    

     

     

    (e)
      Each
      Indemnified Party shall use reasonable efforts to collect any amounts available
      under insurance coverage, or from any other Person alleged to be responsible,
      for any Damages payable under Section 10.02.

     

    Section
      10.04. Knowledge.
      Notwithstanding
      anything in this Agreement to the contrary, the rights of the parties to
      indemnification based on the representations and warranties set forth in this
      Agreement shall not be affected by any investigation conducted with respect
      to,
      or any knowledge acquired (or capable of being acquired) about the accuracy
      or
      inaccuracy of or compliance with, any such representation or
      warranty.

     

    ARTICLE
      11

     

    TERMINA'T'ION

     

    Section
      11.01. Grounds
      for Termination. 'phis
      Agreement
      may be terminated at any time prior to the Closing:

     

    (a) by
      mutual
      written agreement of Seller and Buyer;

     

    (b) by
      either
      Seller or Buyer if consummation of the transactions contemplated hereby would
      violate any nonappealable final order, decree or judgment of any Governmental
      Authority having competent jurisdiction; or

     

    (c) by
      Buyer
      if (i) Seller shall have filed a petition for relief under the Bankruptcy Code
      prior to the Closing or (ii) an involuntary petition for relief under the
      Bankruptcy Code is filed against Seller prior to the Closing by any party other
      than (x) Buyer or its Affiliates or (y) any Person acting at the direction
      of or
      in concert with Buyer or its Affiliates and such petition is not dismissed
      prior
      to the Closing;

     

    The
      party
      desiring to terminate this Agreement pursuant to clauses of this Section 1
      1.01
      shall give notice of such termination to the other party.

     

    Section
      11.02. };'/feet
      of
      Termination. If
      this
      .Agreement is terminated as permitted by Section 11..01, such termination shall
      be without liability of any party (or any stockholder, director, officer,
      .employee, agent, consultant or representative of such party) to any other
      party
      to this
      Agreement;
      provided that if such termination shall result from either party's willful
      (i)
      failure to fulfill a condition to the performance of the obligations of the
      other party, (ii) failure to perform a covenant set forth in this Agreement
      or
      (iii) breach of any representation or warranty or agreement contained herein,
      such failing or breaching party shall be fully liable for any and all Damages
      incurred or suffered

    

    
      
         

      

      
         

        
          

        

      

      
         

        
        

      

    

     

    by
      the
      other party as a result of such failure or breach. The provisions of Section
      6.01, 12.03, 12.05, 12.06 and 12.07 shall survive any termination hereof
      pursuant to Section 11.01.

     

    ARTICLE
      12

     

    MISCELLANEOUS

     

    Section
      12.01. Notices.
      All
      notices and other communications hereunder shall be in writing (including
      facsimile transmission, with confirmation of receipt) and shall be deemed to
      have been duly given (i) when delivered personally or by facsimile, (ii) when
      received by the addressee, if sent by Express Mail, Federal Express or other
      express delivery service (receipt requested), or (iii) three business days
      after
      being sent by registered or certified mail, return receipt requested, in each
      case to the other party at the following addresses (or to such other address
      for
      a party as shall be specified by like notice, provided that notices of a change
      of address shall be effective only upon receipt thereof):

     

    if
      to
      Buyer to:

     

    HARVARD
      HOLDINGS INTERNATIONAL, INC. 3455 Peachtree Road, Suite 500

    Atlanta,
      Georgia 30326

    FAX
      +1
      (954) 212-7751

     

    if
      to
      Seller to:

     

    QUANTUM
      CARGO & AVIATION SERVICES 9809 NW 80`x'
      Ave

    Bay
      9-K

    Ilialeah
      Gardens, Florida 33016

    FAX
      +l
      (305) 231-7123

     

    ;
      provided
      that
      any
      communication by facsimile shall be confirmed by a copy sent via overnight
      mail
      to the physical address of the recipient set forth above. .All such notices,
      requests and other communications shall be deemed received on. the date of
      receipt by the recipient thereof if received prior to 5 p.m. in the place of
      receipt and such .day
      is a
      Business Day in the place of receipt. Otherwise, any such notice, request or
      communication shall be deemed not to have been received until the next
      succeeding Business Day in the place of receipt.

     

    Section
      12.02. Amendments
      and Waivers. (a)
      Any
      provision of this Agreement may be amended or waived only if such _amendment
      or
      waiver is in writing and is signed, in the case of an amendment, by each party
      to this Agreement, or in the case of a waiver, by the party against whom the
      waiver is to be effective.

    

    
      
         

      

      
         

        
          

        

      

      
         

        
        

      

    

     

    (b)
      No
      failure or delay by any party in exercising any right, power or privilege
      hereunder shall operate as a waiver thereof, nor shall any single or partial
      exercise thereof preclude any other or further exercise thereof or the exercise
      of any other right, power or privilege. The rights and remedies herein
provided
      shall be cumulative and not exclusive of any rights or remedies
      provided
      by
      law.

     

    Section
      12.03. Expenses.
      Except
      as
      otherwise provided herein, all costs and expenses incurred in connection with
      this Agreement shall be paid by the party incurring such cost or
      expense.

     

    Section
      12.04. Successors
      and Assigns. The
      provisions of this Agreement shall be binding upon and inure to the benefit
      of
      the parties hereto and their respective successors and assigns; provided that
      no
      party may assign, delegate or otherwise transfer any of its rights or
      obligations under this Agreement without the consent of each other party
      hereto.

     

    Section
      12.05. Governing
      Law.
      This
      Agreement shall be governed by and construed in accordance with the law of
      the
      State of Georgia, without regard to the conflicts of law rules of such
      state.

     

    Section
      12.06. Jurisdiction.
      The
      parties hereto agree that any suit, action or
      proceeding seeking to enforce any provision of, or based on any matter
      arising
      out of
      or in connection with, this Agreement or the transactions contemplated hereby
      shall be brought in the United States District Court for the Southern District.
      In any such suit, action or proceeding each party irrevocably waives, to the
      fullest extent permitted by law, any objection that it may now or hereafter
      have
      to the laying of the venue of any such suit, action or proceeding in any such
      court or that any such suit, action or proceeding brought in any such court
      has
      been brought in an inconvenient forum.

     

     

    Section
      12.07.
      WAIVER
      OF .IURY TRIAL. EACH
      OF
      TILE PARTIES HERETO HEREBY IRREVOCABLY WAIVES ANY ANI) ALL RIGHT' TO TRIAL
      BY
      JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELA`ITbD TO THIS AGREEMENT
      OR
      THE TRANSACTIONS CONTEMPLATED HEREBY.

     

    Section
      12.08. . Counterparts;
      Effectiveness; I hind-Party Beneficiaries. This
      Agreement may be signed in any number of counterparts, each of which shall
      be an
      original, with. the same effect as if the signatures thereto and hereto were
      upon the same instrument. No provision of this Agreement is intended to
confer
      any rights, benefits, remedies, obligations or liabilities hereunder upon
      any
      Person
      other than. the parties hereto and their respective successors and
      assigns.

     

    Section
      12.09. Entire
      Agreement. This Agreement
      (including the Schedules and Exhibits hereto), the Confidentiality Agreement
      and
      the Related Agreements
      constitute the entire agreement between the parties with respect to the
subject
      matter of this Agreement and supersedes all prior agreements and understandings,
      both oral and written, between the parties with respect to the subject matter
      of
      this Agreement.

    
      
         

      

      
         

        
          

        

      

      
         

        
        

      

    

     

    Section
      12.10. Severability.
      If
      any
      term, provision, covenant or restriction of this Agreement is held by a court
      of
      competent jurisdiction or other authority to be invalid, void or unenforceable,
      the remainder of the terms, provisions, covenants and restrictions of this
      Agreement shall remain in full force and effect and shall in no way be affected,
      impaired or invalidated so long as the economic and legal substance of the
      transactions contemplated hereby is not affected in any manner materially
      adverse to any party. Upon such a determination, the parties shall negotiate
      in
      good faith to modify this Agreement so as to effect the original intent of
      the
      parties as closely as possible in an acceptable manner in order that the
      transactions contemplated hereby be consummated as originally contemplated
      to
      the fullest extent possible.

     

    

    
      
         

      

      
         

        
          

        

      

      
         

        
        

      

    

     

    IN
      WITNESS WI1EREOF, the parties hereto have caused this Agreement to be duly
      executed by their respective authorized officers as of the day and year first
      above written.

     

     

    
      	 	 	 
	 	
            
	 
 	 
 	 
 
	 	By:  	/s/ Arnold
              B.
              Leonora 
	 	
              
Arnold
              B. Leonora 
	 	Title:
              Chairman & CEO HARVARD HOLDINGS INTERNATIONAL,
              INC.

    

     

    

    
      	 	 	 
	 	 
	 
 	 
 	 
 
	Date: 	By:  	/s/ Nan ~:
              KiniL. Merced
	 	
              
Nan ~:
              KiniL. Merced
	 	Title: President QUANTUM CARGO & AVIATION SERVICES,
              INC.

    

     

     

     

    Aknowledgements

     

    State
      of    Florida

     

    County
      of    Broward     

     

    The
      foregoing instrument was acknowledged before me this 
      day
      of

    
 

    
      
         

      

      
         

        
          

        

      

      
         

        
        

      

    

    Exhibit
      1

     

    Payment
      Schedule

     

     

    

    
      	
              Upon
                Execution of the agreement

               

            	
              200,000
                Shares of If II Stock

               

            
	
              March
                30'h
                2006

            	
              $25,000.00

            
	
              June
                30`1'
                2006

            	
              $50,000.00

            
	
              September
                30th
                2006

            	
              $25,000.00

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