Exhibit 10(v)(2)
CNA INSURANCE COMPANIES CNA Plaza Chicago, IL 60685
DECLARATIONS EXCESS INSURANCE POLICY
NOTICE
THIS IS A "CLAIMS MADE" POLICY AND, SUBJECT TO ITS PROVISIONS, APPLIES ONLY
TO ANY CLAIM
FIRST MADE AGAINST THE INSUREDS DURING THE POLICY PERIOD. NO COVERAGE
EXISTS FOR ANY
CLAIM FIRST MADE AFTER THE END OF THE POLICY PERIOD UNLESS, AND TO THE
EXTENT, THE
EXTENDED REPORTING PERIOD APPLIES. THE LIMIT OF LIABILITY SHALL BE REDUCED
BY
AMOUNTS INCURRED AS DEFENSE COSTS.
COVERAGE PROVIDED BY
Continental Casualty Company
ACCOUNT NUMBER
45386
POLICY NUMBER DOX 600028634
AGENCY 910 701862
AGENT Mesirow Insurance Services, IBC.
610 Central Ave.
Suite 200
Highland Park, IL 60035
Robina Fisher
NAMED ENTITY AND PRINCIPAL ADDRESS
Item 1. Richardson Electronics Ltd
40W267 Keslinger Road
P.O. Box 393
Lafox, IL 60147 Attn. Dario Sacomani
Item Policy Period:
2.
5/31 /02 To 5/31 /03
12:01 A.M. Standard Time at the Principal Address stated in Item 1.
Item 3.
Limit of Liability (Inclusive of Defense Costs):
$ 5,000,000 Maximum aggregate Limit of Liability each Policy Period.
Item 4. Schedule of Underlying Insurance:
A. Primary Policy
Name of Carrier Policy No. Limits Ded/Ret. Amount
Federal Insurance Company 8125-64-60J ILL $15,000,000 0/0/$100,000
B. Underlying Excess Policy(ies):
*** SEE ATTACHED SCHEDULE ***
Item 5. Policy Premium $ 30,900
Item 6. Forms and Endorsements forming a part of this policy at inception:
G-11713-A12, FIG-1005-A, FIG-1006-A, FIG-1014-A, FIG-0787-A
These Declarations along with the completed and signed Application and the
Excess Insurance Policy, shall constitute the contract
between the Insureds, the Named Entity, and the Insurer. ,
Authorized Representative: /signature/
Chairman /signature/
Secretary /signature/
Date: 10/30/02
G-17728-A
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UDERLYING EXCESS POLICY SCHEDVLE
Directors' & Officers'
Name of Carrier St. Paul Fire and Marine Insurance Company
Policy No. 512CM0138
Limits
$15,000,000 Excess of
Underlying Limit $15,000,000
G-17728-A
(ED 04/92)
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CNA
For All the Commitments You Make
EXCESS INSURANCE POLICY
In consideration of the payment of the premium and in reliance on all
statements made and information furnished to Continental
Casualty Company (hereinafter called the "Insurer'), and/or to the insurers
of the Underlying Insurance, including the statements
made in the Application made a part hereof and subject to all of the
provisions of this Policy, the Insurer and the Insureds agree
as follows:
1. INSURING AGREEMENT
The Insurer shall provide the Insureds with excess coverage over the
Underlying Insurance as set forth in Item 4 of the
Declarations during the Policy Period set forth in Item 2 of the
Declarations. Coverage hereunder shall attach only after
all such Underlying Insurance has been exhausted by payments for losses and
shall then apply in conformance with the
same provisions of the Primary Policy at its inception, except for premium,
limit of liability and as otherwise specifically
set forth in the provisions of this Policy.
II. POLICY DEFINITIONS
Application shall mean the written application for this Policy, including
any materials submitted therewith, which together
shall be on file with the Insurer and deemed a part of and attached hereto
as if physically attached to this Policy.
Named Entity means the organization named in Item 1 of the Declarations.
Insureds means those persons or organization(s) insured under the Primary
Policy, at its inception.
Policy Period means the period from the effective date and hour of this
Policy as set forth in Item 2 of the Declarations, to
the Policy expiration date and hour set forth in Item 2 of the
Declarations, or its earlier cancellation date or termination
date, if any.
Primary Policy means the Policy scheduled in Item 4 (a) of the Declarations.
Underlying Insurance means all those Policies scheduled in Item 4 of the
Declarations and any Policies replacing them.
III. MAINTENANCE OF UNDERLYING INSURANCE
All of the Underlying Insurance scheduled in Item 4 of the Declarations
shall be maintained during the Policy Period in
full effect, except for any reduction of the aggregate limit(s) of
liability available under the Underlying Insurance solely by
reason of payment of losses thereunder, Failure to comply with the
foregoing shall not invalidate this Policy but the
Insurer shall not be liable to a greater extent than if this condition had
been complied with. To the extent that any
Underlying Insurance is not maintained in full effect during the currency
of this Policy Period, then the Insureds shall
be deemed to have retained any loss for the amount of the limit of
liability of any Underlying Insurance which is not
maintained as set forth above.
In the event of any actual or alleged (a) failure by the Insureds to give
notice or to exercise any extensions under any
Underlying Insurance or (b) misrepresentation or breach of warranties by
any of the Insureds with respect to any
Underlying Insurance, the Insurer shall not be liable hereunder to a
greater extent than it would have been in the
absence of such actual or alleged failure, misrepresentation or breach.
It is further a condition of this Policy that the Insurer shall be notified
in writing, as soon as practicable of cancellation
and/or alteration of any provisions of any of the policies of Underlying
Insurance.
IV. LIMIT OF LIABILITY
The amount set forth in Item 3 of the Declarations shall be the maximum
aggregate Limit of Liability of the Insurer for the
Policy Period.
Costs of defense shall be part of and not in addition to the Limit of
Liability in Item 3 of the Declarations, and such costs of
defense shall reduce the Limit of Liability stated in Item 3 of the
Declarations.
G-17729-A(ED.04/92) Page1of4
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V. DEPLETION OF UNDERLYING LIMIT(S)
In the event of the depletion of the limit(s) of liability of the
Underlying Insurance solely as the result of actual payment of
losses thereunder by the applicable insurers, this Policy shall, subject to
the Insurer's Limit of Liability and to the other
terms of this Policy, continue to apply to losses as Excess Insurance over
the amount of insurance remaining under such
Underlying Insurance. In the event of the exhaustion of all of the limits)
of liability of such Underlying Insurance solely
as a result of payment of losses thereunder, the remaining limits available
under this Policy shall, subject to the Insurer's
Limit of Liability and to the other provisions of this Policy, continue for
subsequent losses as primary insurance and any
retention specified in the Primary Policy shall be imposed under this
Policy as to each claim made; otherwise no
retention shall be imposed under this Policy.
This Policy only provides coverage excess of the Underlying Insurance. This
Policy does not provide coverage for any
loss not covered by the Underlying Insurance except and to the extent that
such loss is not paid under the Underlying
Insurance solely by reason of the reduction or exhaustion of the available
Underlying Insurance through payments of
loss thereunder. In the event the insurer of one or more of the Underlying
Insurance policies fails to pay loss in
connection with any claim covered under the Underlying Insurance as a
result of the insolvency, bankruptcy, or
liquidation of said insurer, then the Insureds hereunder shall be deemed to
have retained any loss for the amount of the
limit of liability of said insurer which is not paid as a result of such
insolvency, bankruptcy or liquidation.
If any Underlying Insurance bears an effective date which is prior to the
effective date of this Policy and if any such
insurance becomes exhausted or impaired by payment of loss with respect to
any claim which, shall be deemed to be
made prior to the effective date of this Policy, then with respect to any
claim made after the effective date of this Policy,
the Insureds shall be deemed to have retained any loss for the amount of
any such Underlying Insurance which is
exhausted or impaired by payment of loss with respect to such claim made
prior to the effective date of this Policy.
VI. CLAIM PARTICIPATION
The Insured shall not admit liability, consent to any judgment against
them, or agree to any settlement which is
reasonably likely to involve the Limit of Liability of this Policy without
the Insurer's consent, such consent not to be
unreasonably withheld.
The Insurer may, at its sole discretion, elect to participate in the
investigation, settlement or defense of any claim against
any of the Insureds for matters covered by this Policy even if the
Underlying Insurance has not been exhausted.
All provisions of the Underlying Insurance are considered as part of this
Policy except that it shall be the duty of the
Insureds and not the duty of the Insurer to defend any claims against any
of the Insureds.
VII. SUBROGATION - RECOVERIES
In that this Policy is "Excess Coverage", the Insureds and the Insurer's
right of recovery against any person or other
entity may not be exclusively subrogated. Despite the foregoing, in the
event of any payment under this Policy, the
Insurer shall be subrogated to all the Insured's rights of recovery against
any person or organization, and the Insureds
shall execute and deliver instruments and papers and do whatever else is
necessary to secure such rights.
Any amounts recovered after payment of loss hereunder shall be apportioned
in the inverse order of payment to the
extent of actual payment. The expenses of all such recovery proceedings
shall be apportioned in the ratio of respective
recoveries.
VIII. NOTICE
The Insurer shall be given notice in writing as soon as is practicable in
the event of (a) the cancellation of any Underlying
insurance and (b) any additional or return premiums charged or allowed in
connection with any Underlying Insurance.
Notice regarding (a) and (b) above shall be given to Manager, Directors and
Officers Liability Underwriting, CNA
Insurance Companies, CNA Plaza, Chicago, Illinois 60685.
G-17729-A(ED.04/92) Page2of4
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The Insurer shall be given notice as soon as practicable of any notice of
claim or any situation that could give rise to a
claim under any Underlying Insurance. Notice of any claim to the Insurer
shall be given in writing to Manager,
Professional Liability Claims, CND, Insurance Companies, CNA Plaza,
Chicago, Illinois 60685.
IX. COMPANY AUTHORIZATION CLAUSE
By acceptance of this Policy, the Named Entity named in Item 1 of the
Declarations agrees to act on behalf of all the
Insureds with respect to the giving and receiving of notice of claim or
cancellations, the payment of premiums and the
receiving of any return premiums that may become due under this Policy; and
the Insureds agree that the Named Entity
shall in all cases be authorized to act on their behalf.
X. ALTERATION
No change in or modification of this Policy shall be effective except when
made by endorsement signed by an authorized
employee of the Insurer or any of its agents relating to this Policy.
XI. POLICY CANCELLATION
This Policy may be cancelled by the Named Entity at any time by written
notice or by surrender of this Policy to the
Insurer. This Policy may also be cancelled by or on behalf of the Insurer
by delivery to the Named Entity or by mailing
to the Named Entity, by registered, certified or other first class mail, at
the address shown in Item 1 of the Declarations,
written notice stating when, not less than thirty (30) days thereafter, the
cancellation shall become effective. The mailing
of such notice as aforesaid shall be sufficient proof of notice and this
Policy shall cancel at the date and hour specified in
such notice.
If the period of limitation relating to the giving of notice is prohibited
or made void by any law controlling the construction
thereof, such period shall be deemed to be amended so as to be equal to the
minimum period of limitation permitted by
such law.
The Insurer shall refund the unearned premium computed at less than
pro-rata if the Policy is cancelled in its entirety by
the Named Entity. Under any other circumstances the refund shall be
computed pro-rata.
XI1. EXCLUSIONS
Notwithstanding any provisions of the Underlying Insurance, the Insurer
shall not be liable to make payment for loss in
connection with any claim based upon, arising out of, relating to, directly
or indirectly resulting from, or in consequence of,
or in any way involving:
1. nuclear reaction, radiation, or contamination regardless of causes;
2. pollutants, including but not limited to loss arising out of any: ,
a. request, demand or order that any of the Insureds or others test for,
monitor, clean up, remove, contain,
treat, detoxify or neutralize, or in any way respond to, or assess the
effects of pollutants, or
b. claim by or on behalf of a governmental authority for damages because of
testing for, monitoring, cleaning up,
removing, containing, treating, detoxifying or neutralizing or in any way
responding to or assessing the effects
of pollutants.
Pollutants means any solid, liquid, gaseous or thermal irritant or
contaminant, including smoke, vapor, soot, fumes, acids,
alkalis, chemicals and waste. Waste includes materials to be recycled,
reconditioned or reclaimed.
G-17729-A (ED. 04/92) Page 3 of 4
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XIII. CONDITIONS
No action shall be taken against the Insurer unless, as a condition
precedent, there shall have. been full compliance with
all the provisions of this Policy, nor until the amount of the Insureds
obligation to pay shall have been finally determined
either by final and nonappealable judgement against the Insureds after
trial, or by written agreement of the Insureds, the
claimant and the Insurer.
/signature/
Chairman of the Board
/signature/
Secretary
G-17729-A (ED. 04192) Page 4 of 4
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STATE PROVISIONS - ILLINOIS
Any cancellation or non-renewal provisions contained in the policy to which
this endorsement is attached are deleted and replaced
by the following:
I. Cancellation
A. This policy can be cancelled by either the first named insured or the
insurer.
1. The named insured can cancel this policy at any time by mailing advance
written notice to the insurer
stating when the cancellation is to be effective.
2. The insurer can cancel this policy by giving written notice to the named
insured at least:
a. 10 days, if cancellation is for non-payment of premium. However, the
named insured may
continue the coverage by payment in full at any time prior to the effective
date of cancellation;
b. 30 days, if cancellation is for any other reason provided that the policy
has been in effect for 60
days or less; or
c. 60 days, if the policy has been in effect for more than 60 days and
cancellation is for any other
reason as set forth below;
before the effective date of cancellation..
B. The insurer will mail notice to the named insured at the last mailing
address known to the insurer, and a copy
shall also be mailed to the named insured's agent.
C. Notice of cancellation will state the effective date of cancellation. The
policy will end on that date. The specific
reason for such cancellation shall also be stated.
D. Proof of mailing will be sufficient proof of notice.
E. If this policy is cancelled, the insurer will send the first named
insured any premium refund due. If the insurer
cancels, the refund will be pro-rata. If the named insured cancels, the
refund may be less than pro-rata.
This endorsement, which forms a part of and is for attachment to the
following described Policy issued by the designated .
Insurers takes effect on the effective date of said Policy, unless another
effective date is shown below, at the hour stated in
said Policy and expires concurrently with said Policy.
Page 1 of 3
CNA INSURANCE COMPANIES
G-11713-A12
(ED. 10/87)
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The cancellation will be effective even if the insurer has not made or
offered a refund.
If this policy has been in effect for more than 60 days, the insurer shall
not terminate this policy except for one or
more of the following conditions:
1. non-payment of premium;
2. material misrepresentation;
3. material increase in the hazard insured against;
4. violation of any terms or conditions of the policy by the named insured;
5. substantial loss of reinsurance by the insurer affecting this particular
type of insurance, certified to the insurance regulatory authority;
6. a determination by the insurance regulatory authority that continuation
of the policy will place the insurer
in violation of the insurance laws of the state.
II. Non-Renewal
If the insurer decides not to renew this policy, 60 days advance written
notice shall be mailed to the named insured as the
last known address. -
The notice shall include the specific reason for such non-renewal.
If the insurer offers to renew this policy at terms which involve an
increase in premium of 30 % or more or changes in
deductibles or coverage that materially alter the policy, such terms will
take effect on the renewal date if the insurer has
notified. the named insured of the terms at least 60 days prior to the
expiration date of this policy.
This endorsement, which forms a part of and is for attachment to the
following described Policy issued by the designated
Insurers takes effect on the effective date of said Policy, unless another
effective date is shown below, at the hour stated in
said Policy and expires concurrently with said Policy.
Page 2 of 3
CNA INSURANCE COMPANIES
G-11713-A12
(ED. 10/87)
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This notice is to advise the named insured that should any complaints arise
regarding this insurance, the named insured may
contact the following:
CNA Insurance Companies
Attn: Consumer Affairs Department - 13S
CNA Plaza Chicago, IL 60685
and/or
Illinois Department of Insurance
Consumer Division or Public Service Section
Springfield, II, 62767
Page 3 of 3
G-11713-A12
(ED. 10/87)
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PRIOR NOTICE EXCLUSION
In consideration of the premium paid for this policy, it is agreed that
SectionXII. EXCLUSIONS, is amended with the addition of the
following:
Any fact, circumstance, situation, transaction or event which constitutes
the basis of notice of claim to the Insurer or any insurance
carriers designated in Item 4. of the Declarations, prior to the inception
date of this policy.
All other provisions of the policy remain unchanged
Page 1 of 1
FIG-1005-A
(Ed. 07/94)
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PRIOR OR PENDING LITIGATION EXCLUSION
In consideration of the premium paid for this policy, it is agreed that
Section XII is amended with the addition of the following:
3. Any fact, circumstance, situation, transaction or event underlying or
alleged in any prior and/or
pending litigation as of 5/31/91, regardless of the legal theory upon which
such
litigation is predicated.
All other provisions of the policy remain unchanged.
Page 1 of 1
FIG-1006-A
(ED. 07/94)
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INAPPLICABILITY OF PRIMARY POLICY ENDORSEMENT
In consideration of the premium paid for this policy, it is agreed that for
the coverage afforded under this policy endorsement number
8. to the Primary Policy shall not apply to this Policy.
All other provisions of the Policy remain unchanged.
Page 1 of 1
FIG-1014-A
07/94
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AMENDMENT OF PRIMARY POLICY DEFINITION TO FOLLOW CHUBB D&O COVERAGE
In consideration of the premium paid for this Policy, it is agreed that:
I. Item 4.A. of the Declarations is deleted and the following is substituted:
"A. Primary Policy
Name of Carrier: Federal Insurance Company
Policy No.8125-64-60J ILL
Applicable Coverage Section:
Executive Liability and Indemnification Coverage Section (Form 14-02-0943)
and any applicable
endorsements and General Terms and Conditions (Form 14-02-0941) pertaining
thereto
Limit of Liability of Primary Policy Applicable to Executive Liability and
Indemnification Coverage
Section
(a) each Loss: $15,000,000
(b) each Policy Period: $15,000,000
Deductible of Primary Policy Applicable to Executive Liability and
Indemnification Coverage
Section:
$100,000
2. II. POLICY DEFINITIONS is amended by deleting "Primary Policy means the
Policy scheduled in Item 4.A.
of the Declarations" and substituting the following:
"Primary Policy" means only the Executive Liability and Indemnification
Coverage Section (Form 14-02-
0943), and any applicable endorsements and General Terms and Conditions
(Form 14-02-0941) pertaining
thereto of the Executive Protection Policy issued by Federal Insurance
Company, as such policy is identified in
Item 4.A. of the Declarations, and shall not include any other coverage
section contained in such policy."
All other provisions of the Policy remain unchanged.
Page 1 of 1
FIG-0787-A
(ED. 12/93)
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