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EXHIBIT 10.6
SERVICES AGREEMENT
This Services Agreement (this "Agreement") is made and entered into as
of _______________, 1996 by and between AMERISAFE, Inc., a Texas corporation
("AMERISAFE"), and Auto One Acceptance Corporation, a Texas corporation ("Auto
One").
RECITALS
A. Auto One is a former subsidiary of AMERISAFE.
B. AMERISAFE has historically provided to its subsidiaries,
including Auto One and its subsidiaries, certain administrative and management
services.
C. Auto One desires that AMERISAFE continue to provide certain
administrative and management services to Auto One and AMERISAFE agrees to
provide such services on the terms and subject to the conditions set forth
herein.
NOW, THEREFORE, for and in consideration of the agreements set forth
herein and other good and valuable consideration, the receipt and sufficiency
of which are hereby acknowledged, the parties hereto agree as follows:
1. Administrative Services. AMERISAFE shall provide or cause to
be provided to Auto One and its subsidiaries, if, when and to the extent
requested by Auto One, the administrative and management services described on
Exhibit A hereto (the "Services").
2. Charges for Services. (a) In consideration for AMERISAFE
providing the Services to Auto One, Auto One will pay AMERISAFE a monthly fee
of $40,000 (the "Fee"). Auto One shall remit the Fee, in full, on or before
the last calendar day of the month commencing with the month in which the
Effective Date (as defined in Section 5) occurs and continuing until the
termination of this Agreement in accordance with its terms. The Fee shall be
pro rated for any partial calendar month based upon the actual number of days
during such month in which this Agreement was in effect.
(b) In addition to the Fee, Auto One shall reimburse
AMERISAFE for all third-party out-of-pocket expenses ("Expenses") incurred by
AMERISAFE in connection with providing the Services. Following the end of each
month during the term of this Agreement, AMERISAFE shall submit to Auto One a
statement (each a "Reimbursement Statement") setting forth the aggregate
Expenses, including reasonable supporting documentation, incurred in such
month. Promptly (and, in any event, within 10 business days) following receipt
of the Reimbursement Statement, Auto One shall pay to AMERISAFE the amount of
the Expenses set forth therein.
3. Performance of Services.
(a) Degree of Care. AMERISAFE shall perform the Services
with the same degree of care, skill and prudence customarily exercised by it in
respect of its own business, operations and affairs. It is understood and
agreed that the Services shall be substantially identical in nature and quality
to the Services performed by AMERISAFE for Auto One immediately prior to the
Effective Date.
(b) Certain Limitations. Each party acknowledges that
the Services shall be provided only with respect to the businesses of Auto One
and its subsidiaries as such businesses exist as of the Effective Date or as
otherwise mutually agreed by the parties. AMERISAFE will not be obligated to
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provide Services for the benefit of entities other than Auto One and its
subsidiaries. Auto One shall use the Services only in accordance with all
applicable federal, state and local laws and regulations.
(c) Certain Information. Auto One shall provide, and
shall cause each of its subsidiaries to provide, in a manner consistent with
the practices employed by the parties prior to the Effective Date, any
information needed by AMERISAFE from Auto One or such subsidiary, as the case
may be, to perform the Services pursuant hereto. If the failure to provide
such information renders the performance of any requested Service impossible or
unreasonably difficult, AMERISAFE may, upon reasonable notice to Auto One,
refuse to provide such Service.
4. Limitations on Liability and Indemnification.
(a) Limitations on Liability. Neither party will have
any liability under this Agreement (including any liability for its own
negligence) for damages, losses or expenses suffered by the other party or its
subsidiaries as a result of the performance or non-performance of such party's
obligations hereunder, unless such damages, losses or expenses are caused by or
arise out of the willful misconduct or gross negligence of such party or a
breach by such party of any of the express provisions hereof. In no event will
either party have any liability to the other party for indirect, incidental or
consequential damages that such other party or its subsidiaries or any third
party may incur or experience on account of the performance or non-performance
of such party's obligations hereunder.
(b) Indemnification. Subject to the limitations on
liability set forth in the last sentence of Section 4(a) hereof, each party
shall indemnify, defend and hold harmless the other party and its directors,
officers, employees, agents and representatives from and against all claims,
liabilities, damages, losses and expenses (including without limitation
reasonable attorneys' fees and expenses) caused by or arising out of the
willful misconduct or gross negligence of such indemnifying party in the
performance or non-performance of its obligations hereunder or the breach by
such indemnifying party of any of the express provisions hereof.
(c) The provisions of this Section 4 shall survive any
termination of this Agreement.
5. Term of Agreement. This Agreement shall become effective on
the closing date of AMERISAFE's initial public offering its Class A Common
Stock (the "Effective Date") and shall continue until terminated by either
party in accordance with this Section 5. Neither party hereto may terminate
the Agreement prior to the first anniversary date of the Effective Date.
Thereafter, this Agreement shall be terminable by either party upon not less
than 90 days' prior written notice to the other party. Termination under this
Section 5 or otherwise shall have no effect on the respective obligations of
the parties prior to the date of such termination or their respective
obligations to make any payment required to be made pursuant to the terms
hereof.
6. Confidentiality. Each party shall hold in trust and maintain
confidential and, except as required by law, not disclose to others without the
prior written approval of the other party, any information received by it from
the other party or developed or otherwise obtained by it in connection with the
performance of its obligations hereunder (the "Information"). Within 30 days
after the date of termination of this Agreement, each party shall return to the
other party, or, with the written consent of the other party, destroy all
documents, data and other materials of whatever nature relating to the
businesses of the other party and its subsidiaries that it obtained in
connection with the performance of its obligations hereunder, provided that the
parties may retain any Information to the extent reasonably needed to comply
with applicable tax, accounting or financial reporting requirements or to
resolve any legal issues identified at the time of termination. The provisions
of this Section 6 shall survive any termination of this Agreement.
7. Miscellaneous.
(a) Successors and Assigns. This Agreement shall be
binding upon the parties hereto and their respective successors and permitted
assigns and shall inure to the benefit of the parties hereto and
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their respective successors and permitted assigns. This Agreement may not be
assigned by either party hereto to any other person except with the express
written consent of the other party.
(b) No Third-Party Beneficiaries. Except for the persons
entitled to indemnification pursuant to Section 4(b) hereof, each of whom is an
intended third-party beneficiary hereunder, nothing expressed or implied in
this Agreement shall be construed to give any person or entity other than the
parties hereto any legal or equitable rights hereunder.
(c) Entire Agreement. This Agreement constitutes the
entire agreement among the parties relating to the subject matter hereof.
(d) Amendment. This Agreement may be amended or
supplemented at any time provided that any such amendment or supplement must be
made in writing and signed by each of the parties hereto.
(e) Assignment. This Agreement and the rights, duties,
obligations and privileges hereunder may not be assigned by either party
without the prior written consent of the other party.
(f) Waivers. Either party hereto may (i) extend the time
for the performance of any of the obligations or other acts of the other party
or (ii) waive compliance with any of the agreements contained herein. No
waiver of any term shall be construed as a waiver of the same term, or a waiver
of any other term, of this Agreement. The failure of any party to assert any
of its rights hereunder will not constitute a waiver of any such rights.
(g) Severability. If any provision of this Agreement is
invalid, illegal or incapable of being enforced by any rule of law or public
policy, such provision shall be deemed severable and all other provisions of
this Agreement shall nevertheless remain in full force and effect.
(h) Headings. Section headings in this Agreement are
included herein for convenience of reference only and shall not constitute a
part of this Agreement for any other purpose.
(i) Notices. All notices given in connection with this
Agreement shall be in writing. Service of such notices shall be deemed
complete (i) if hand delivered, on the date of delivery, (ii) if by mail, on
the fourth business day following the day of deposit in the United States mail,
by certified or registered mail, first-class postage prepaid, or (iii) if sent
by Federal Express or equivalent courier service, on the next business day.
Such notices shall be addressed to the parties at the following addresses or at
such other address for a party as shall be specified by like notice (except
that notices of change of address shall be effective upon receipt):
If to AMERISAFE: AMERISAFE, Inc.
2301 Highway 190 West
DeRidder, Louisiana 70634
Attention: President
Telephone: (318) 463-9052
Telecopy: (318) 463-7298
If to Auto One: Auto One Acceptance Corporation
5550 LBJ Freeway, Suite 901
Dallas, Texas 75240
Attention: President
Telephone: (214) 661-1234
Telecopy: (214) 239-6380
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(j) Governing Law. This Agreement shall be governed by,
and construed in accordance with, the substantive laws of the State of
Louisiana, without giving effect to the principles of conflict of laws of such
State.
(k) Counterparts. This Agreement may be executed in any
number of counterparts, each of which shall be deemed to be an original, but
all of which together shall constitute but one agreement.
IN WITNESS WHEREOF, AMERISAFE and Auto One have caused this Agreement
to be executed on the date first above written.
AMERISAFE, INC.
By:
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Mark R. Anderson, President
AUTO ONE ACCEPTANCE CORPORATION
By:
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James Bass, President
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EXHIBIT A
Administrative and Management Services
1. General Accounting
(a) Journal entry coding and input
(b) Maintenance of ledger system
(c) Reconciliation of bank accounts
(d) Other general accounting functions
2. Financial Reporting and Accounting Research
(a) Preparation of financial statements
(b) Research regarding the impact of accounting standards
3. Internal and External Auditing
(a) Internal audit
(b) Review of internal accounting and administrative controls
(c) Review of operational and financial management
4. Employee Matters
(a) Payroll
(b) Benefits administration
5. Risk Management
Administration of risk management matters
6. Tax
(a) Preparation and filing of all tax returns
(b) Assistance with state and local property tax compliance
(c) Assistance with financial accounting and taxes
(d) Supervision of all federal, state and local tax audits,
protests, administrative proceedings and litigation
(e) Qualification and design of all employee benefit plans
(f) Preparation and submission of all tax ruling requests
(g) Rendering and obtaining all tax opinions
(h) Qualification and reporting of stock options
7. Legal
Advice and assistance with respect to legal matters
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8. Governmental Reports
Preparation of reports required to be filed with governmental agencies
9. Human Resources
Advice and assistance with respect to compensation, employee benefits
and other employee matters
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