EXHIBIT 10.27
LOAN AGREEMENT
This Loan Agreement ("Agreement") is effective this 1st day of September, 2004;
supercedes prior agreements and is entered into, by and between, Ameritrust
Insurance Corporation, a Florida corporation whose principal place of business
is 7250 S. Beneva Road, Sarasota, Florida 34238 ("Ameritrust"); Savers Property
and Casualty Insurance Company, a Missouri corporation whose principal place of
business is 11880 College Blvd., Suite 500, Overland Park, Kansas 66210
("Savers"); Star Insurance Company, a Michigan corporation whose principal place
of business is 26600 Telegraph Road, Southfield, Michigan 48034 ("Star");
Williamsburg National Insurance Company, a California corporation whose
principal place of business is 12641 E. 166th Street, Cerritos, California 90703
("Williamsburg"), Meadowbrook Insurance Group, Inc., a Michigan corporation
whose principal place of business is 26600 Telegraph Road, Southfield, Michigan
48034 ("MIGI") (collectively the "Parties" and individually the "Party"), and
Meadowbrook, Inc., a Michigan corporation whose principal place of business is
26600 Telegraph Road, Southfield, Michigan 48034 ("Meadowbrook").
For value received, the Parties agree as follows:
1. Meadowbrook is authorized to advance monies (the "Advances"), in
Meadowbrook's control, from any of the Parties (individually referred
to as the "Creditor") to any of the other Parties (individually
referred to as the "Debtor").
2. Meadowbrook is authorized to direct any of the Parties, as a Debtor,
to receive funds (the "Advances") from another of the Parties acting as
the Creditor.
3. The Parties acknowledge that from time to time one Party may receive
payment from or make payments to third parties on behalf of itself and
one or more of the other Parties. Meadowbrook is authorized to direct
any of the Parties, as a Debtor, to receive funds, (the "Payments") for
the benefit of another Party as a Creditor, from a third party; or to
direct any of the Parties acting as a Creditor, to make payments to
third parties, on behalf of another Party acting as a Debtor.
4. Meadowbrook, in its sole discretion, shall determine, from time to
time: (a) the amount of Advances or Payments to be made (however, in
instances involving third party funds as described in Paragraph 3, the
Payments or Advances shall not exceed the amounts which would have been
paid to or received from the third party had the transaction occurred
directly between the third party and the individual Parties); (b) the
Debtor or third party to receive the funds; and (c) the Creditor that
will make Advances to another Party or receive Payments for the benefit
of another Party from third parties.
5. The amount of Advances and Payments made, at any one time, by any
Creditor, plus the amount of Advances and Payments previously made and
not yet repaid to that same Creditor; or the amount of Advances and
Payments to be received, at any one time, by any Debtor plus the
Advances previously received and Payments made on behalf of that same
Debtor and not yet repaid, shall not exceed the lesser of three percent
(3%) of either the Creditor's or Debtor's admitted assets or
twenty-five percent (25%) of either the Creditor's or Debtor's policy
holder surplus as of the preceding December 31st. This limitation is
based on the statutes and regulations as promulgated by the states in
which each of the
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Parties are domiciled. In the event that those statutes or regulations
are modified or changed, then these limitations will be so modified or
changed to comport with the changes to the statutes or regulations.
6. Meadowbrook shall maintain a written record of all Advances and
Payments made pursuant to this Agreement.
7. Meadowbrook shall determine, in its sole discretion, the date upon
which any Advances or Payments shall be repaid to the Creditor by the
Debtor. However, Advances or Payments, which are a result of third
party transactions, as defined in Paragraph 3, shall be settled within
30 days of receipt from or payment to the third party.
8. The Debtors agree to pay interest on the Advances and Payments made by
the Creditors. The rate of interest shall be a reasonable rate and be
determined by Meadowbrook. However, interest shall accrue and be
charged by the Creditor, only on and after the last day of the month
following the month in which the funds were advanced.
9. A waiver of any breach of any duty or obligation by any of the Parties
to this Agreement shall not be considered a waiver of any subsequent
breach of that same duty or obligation or a waiver of the subsequent
breach of any other duty or obligation.
10. This Agreement and all matters collateral thereto shall be interpreted
and construed in accordance with the laws of the State of Michigan
without regard to any conflict of law provisions contained therein.
11. This Agreement may not be assigned by any of the Parties without the
prior written consent of all the other Parties to this Agreement. This
Agreement shall be binding upon and inure to the benefit of the Parties
hereto and their respective heirs, successors and assigns.
12. The term of this agreement shall be for a period of one (1) year and
shall automatically renew for successive one (1) year periods unless
any of the Parties notifies the other Parties that it intends not to
renew the Agreement. Such notice shall be given no less than sixty (60)
days prior to the termination date of the then existing Agreement.
13. Any notice required to be given under this Agreement shall be in
writing and be delivered by U.S. Mail, postage prepaid, or by facsimile
to the addresses first noted above, or such other address as may be
designated by the Parties from time to time, with a copy of each such
notice to all the Parties to this Agreement
14. This Agreement contains the entire understanding of the Parties hereto
relating to the subject matter contained herein and can be changed or
modified only by a writing signed by all the Parties to this Agreement.
15. The undersigned hereby warrant that they are authorized to enter into
and execute this Agreement.
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Agreed to as of the date noted above:
AMERITRUST INSURANCE CORPORATION
/s/ Robert S. Cubbin
- --------------------------------------------------------------
By: Robert S. Cubbin
Its: President and CEO
SAVERS PROPERTY AND CASUALTY INSURANCE COMPANY
/s/ Gregory L. Wilde
- --------------------------------------------------------------
By: Gregory L. Wilde
Its: President
STAR INSURANCE COMPANY
/s/ Gregory L. Wilde
- --------------------------------------------------------------
By: Gregory L. Wilde
Its: President
WILLIAMSBURG NATIONAL INSURANCE COMPANY
/s/ Gregory L. Wilde
- --------------------------------------------------------------
By: Gregory L. Wilde
Its: President
MEADOWBROOK, INC.
/s/ Robert S. Cubbin
- --------------------------------------------------------------
By: Robert S. Cubbin
Its: President and CEO
MEADOWBROOK INSURANCE GROUP, INC.
/s/ Robert S. Cubbin
- --------------------------------------------------------------
By: Robert S. Cubbin
Its: President and CEO
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