Motion for sale of Subsidiary Acceptance Insurance Company
1)The Stalking Horse is DARAG North America
2)The Stalking Horse bid is $4,000,000
3) Date of court hearing to approve Motion for Sale is 12/4/2020
4) Sale includes the surplus note for $20,000,000.
5) Purchase Price Adjustment. The Purchase Price is based on an adjusted net asset value
(“NAV”) of Six Million Eight Hundred Nineteen Thousand Three Hundred and Nine Dollars ($6,819,309)
(the “Signing NAV”). The Purchase Price divided by the Signing NAV is the “Applicable Percentage
6)1.4.3 Notwithstanding anything in this Agreement to the contrary, the Closing NAV shall not include the approximate One Million Three Hundred Twenty-Seven Thousand Dollars($1,327,000) 2019 trust release related to the “Praetorian Trust”
7) 6. Reliance Insurance Company.
The Company, and former affiliates Acceptance Indemnity Insurance Company (“AIIC”) and Redland Insurance Company (“RIC”), filed proofs of claim on an aggregate basis in the Reliance Insurance Company (In Liquidation) case filed in the Commonwealth Court of Pennsylvania (Cause NO.: 1 REL 2001) (the “Reliance Proofs of Claim”). With respect to any proceeds or distributions related to such Reliance Proofs of Claim (the “Reliance Proceeds”), the Company’s portion of such Reliance Proceeds (with Company’s portion including any Reliance Proceeds with respect to RIC),
total approximately ninety-four percent (94%) of the Reliance Proceeds (the “Seller’s Share”), with the remaining approximately six percent (6%) of any Reliance Proceeds belonging to AIIC (“AIIC’s Share”).
The parties agree that the Seller shall be solely entitled to the Seller’s Share of the Reliance Proceeds. Upon receipt of any Reliance Proceeds from the Reliance Proofs of Claim, the Company shall promptly pay the Seller’s Share to the Seller and AIIC’s Share to AIIC, and in no event later than ten (10) business days after
the Company is in possession of receipt of such Reliance Proceeds. If Closing has occurred, Purchaser shall cause Company to pay such Reliance Proceeds received by Company to Seller and AIIC as set forth above. Seller may sell its Seller’s Share in the Reliance Proofs of Claim, in its sole discretion, to any third
party (the “Reliance Claim Buyer”) at any time. Upon written notice by Seller of such sale to Company,Company shall pay, and after Closing Purchaser shall cause Company to pay, any Reliance Proceeds that Company receives related to Seller’s Share to the Reliance Claim Buyer, in accordance with the same terms and conditions it would have paid such Seller’s Share to Seller under this Section 6. Any such Reliance Proofs of Claim and Reliance Proceeds shall not be considered when determining the Closing NAV.
8) Initial overbid would be $4,286,000. In which case the stalking horse would receive a breakup fee of $186,000. Bids after the initial overbid would be in $50,000 increments.
AI
