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EXHIBIT 10(II)
Second Amendment to the
Reinsurance Pooling Agreement
Amended and Restated as of January 1, 2000
by and among State Automobile
Mutual Insurance Company, State
Auto Property and Casualty
Insurance Company, Milbank
Insurance Company, Midwest
Security Insurance Company,
Farmers Casualty Insurance
Company and State Auto
Insurance Company
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SECOND AMENDMENT TO THE
REINSURANCE POOLING AGREEMENT
AMENDED AND RESTATED AS OF
JANUARY 1, 2000
This Second Amendment to the Reinsurance Pooling Agreement, Amended and Restated
as of January 1, 2000, (the "2000 Pooling Agreement") by and among State
Automobile Mutual Insurance Company ("State Auto Mutual"), State Auto Property
and Casualty Insurance Company ("State Auto P&C"), Milbank Insurance Company
("Milbank"), Midwest Security Insurance Company ("Midwest"), Farmers Casualty
Insurance Company ("Farmers Casualty") and State Auto Insurance Company ("State
Auto IC") is made this 14th day of June 2001, but is effective at 12:00 am
Columbus, Ohio time June 1, 2001.
BACKGROUND INFORMATION
Meridian Mutual Insurance Company ("Meridian Mutual") entered into an Agreement
to Merge dated October 25, 2000, (the "Merger Agreement") with State Auto Mutual
pursuant to which Meridian Mutual will merge with and into State Auto Mutual
with State Auto Mutual being the surviving corporation of the merger (the
"Merger").
Pursuant to the Merger Agreement, as of the effective time of the Merger, State
Auto Mutual is subject to all duties, liabilities and obligations of Meridian
Mutual, which duties, liabilities, and obligations will, by operation of law and
the terms of the 2000 Pooling Agreement, become subject to the 2000 Pooling
Agreement.
For business and accounting reasons, the parties to the 2000 Pooling Agreement
desire to eliminate from the 2000 Pooling Agreement the duties, liabilities, and
obligations of Meridian Mutual that otherwise are the legal obligation of State
Auto Mutual as a result of the Merger, for a thirty day period commencing June
1, 2001 and ending June 30, 2001.
State Auto Mutual intends to address those duties, liabilities, and obligations
of Meridian Mutual that are subject to the Agreement for this 30 day period by
amending the pooling agreement to which Meridian Mutual was a party prior to the
Merger to have that pooling agreement operate as though the Merger had not
occurred.
This clarification requires that this Second Amendment be entered into to be
effective as of 12:00 a.m., Columbus, Ohio time June 1, 2001, the effective time
of the Merger.
STATEMENT OF AGREEMENT
In consideration of the mutual covenants set forth herein and INTENDING
TO BE LEGALLY BOUND HEREBY, the Pooled Companies agree to amend the 2000 Pooling
Agreement as follows:
1. Capitalized terms used in the Second Amendment which are not otherwise
defined herein are defined in the 2000 Pooling Agreement and those
definitions shall apply in this Second Amendment.
2. Section 20 is hereby added to the 2000 Pooling Agreement and it reads
as follows:
Notwithstanding anything to the contrary set forth elsewhere in the
2000 Pooling Agreement, it is understood and agreed that State Auto
Mutual's obligations and any of the other parties' obligations under
the 2000 Pooling Agreement do not
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include any liabilities arising under: 1) all contracts and policies of
insurance which were the legal obligation of Meridian Mutual
immediately prior to the effective time of the Merger, which became the
legal obligation of State Auto Mutual solely as a result of the Merger
and 2) those policies of insurance issued or renewed in the name of
State Auto Mutual from and after the effective time of the Merger and
this Amendment, that but for the Merger, would have been issued or
renewed in the name of Meridian Mutual.
3. It is the intent of the parties through this Second Amendment to amend
the Agreement only for a limited period of time, through the end of the
current calendar quarter (June 30, 2001), while limiting State Auto
Mutual's and the other parties' obligations to those that they would
have incurred had the Merger with Meridian Mutual not occurred.
4. The Second Amendment becomes effective as of 12:00 am Columbus, Ohio
time June 1, 2001 and it terminates as of 12:00 am Columbus, Ohio time
July 1, 2001.
Except as amended herein the 2000 Pooling Agreement shall continue in
full force and effect, as previously amended.
By their signatures hereon the parties hereby agree to the foregoing
Second Amendment.
State Automobile Mutual Insurance Company
By: /s/ Steven J. Johnston
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Steven J. Johnston, Senior Vice President
State Auto Property and Casualty Insurance Company
By: /s/ Steven J. Johnston
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Steven J. Johnston, Senior Vice President
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Milbank Insurance Company
By: /s/ Steven J. Johnston
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Steven J. Johnston, Senior Vice President
Midwest Security Insurance Company
By: /s/ Steven J. Johnston
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Steven J. Johnston, Senior Vice President
Farmers Casualty Insurance Company
By: /s/ Steven J. Johnston
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Steven J. Johnston, Senior Vice President
State Auto Insurance Company
By: /s/ Steven J. Johnston
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Steven J. Johnston, Senior Vice President