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Exhibit 10.3
SNIG ASSUMPTION ACKNOWLEDGMENT
(1996 LOAN AGREEMENT)
SNIG ASSUMPTION ACKNOWLEDGMENT (the "SNIG Assumption Acknowledgment"),
dated as of April 11, 1997 among Superior National Insurance Group, Inc.
("SNIG"), a California corporation, Superior National Insurance Group, Inc.
("Holdings"), a Delaware corporation and The Chase Manhattan Bank, as
Collateral Agent. Unless otherwise defined herein, all capitalized terms used
herein and defined in the Credit Agreement referred to below are used as so
defined.
W I T N E S S E T H :
WHEREAS, SNIG, Centre Reinsurance Limited ("Centre Re") and
The Chase Manhattan Bank, as Collateral Agent (the "Collateral Agent") are
parties to a Credit Agreement, dated as of November 12, 1996 (as modified,
supplemented and amended to the date hereof, the "Credit Agreement") providing
for the making of Loans to SNIG referred to therein, all as contemplated
therein;
WHEREAS, SNIG intends to reincorporate in Delaware (the
"Reincorporation Merger") by merging with Holdings, with Holdings to be the
surviving corporation of such merger and whereby Holdings shall, by operation
of law, assume all rights, obligations, duties and liabilities of SNIG under
the Credit Documents; and
WHEREAS, subject to the terms and conditions set forth below, the
parties hereto desire that Holdings acknowledge that it assumes all of SNIG's
rights, obligations, duties and liabilities under the (i) the Credit Agreement
and (ii) each other Credit Document;
NOW, THEREFORE, it is agreed:
1. Holdings hereby expressly acknowledges that it assumes all
rights, obligations, duties and liabilities of SNIG under the Credit Agreement
and the other Credit Documents.
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2. Upon the effectiveness of this SNIG Assumption Acknowledgment,
all references in the Credit Agreement to "SNIG" and all references in the
Security Agreement to the "Assignor" shall be deemed to be references to
Holdings. Holdings expressly acknowledges and agrees that by executing and
delivering this SNIG Assumption Acknowledgment it does hereby grant to the
Collateral Agent for the benefit of Centre Re a continuing security interest of
first priority in, all of the right, title and interest of Holdings in, to and
under the Collateral (as defined in the Security Agreement), now existing or
hereafter acquired, all as if Holdings had executed and delivered such Security
Agreement.
3. To induce the Collateral Agent to enter into this SNIG
Assumption Acknowledgment, Holdings hereby represents, warrants and agrees as
follows:
a) on the date hereof and after giving effect to
Holdings execution and delivery of this SNIG Assumption Acknowledgment, all
representations and warranties contained in each of the Credit Documents are
true and correct in all material respects and no Default or Event of Default is
in existence; and
b) on and after the date hereof, Holdings will fully and
faithfully perform all obligations (including payment obligations and
compliance with all covenants) of (i) the "Borrower" under the Credit
Agreement, (ii) the "Assignor" under the Security Agreement and (iii) "SNIG"
under the Asset Transfer Agreement and will fully and faithfully perform all of
its obligations under any other Credit Document executed and delivered by it.
4. This SNIG Assumption Acknowledgment shall become effective as
of the date first above written, when each of the parties hereto shall have
executed a copy hereof and shall have delivered the same to the Collateral
Agent.
5. This SNIG Assumption Acknowledgment may be executed in any
number of counterparts and by the different parties hereto on separate
counterparts, each of which when so executed and delivered shall be an
original, but all of which shall constitute one and the same instrument. A
complete set of counterparts shall be lodged with Holdings and the Collateral
Agent.
6. THIS SNIG ASSUMPTION ACKNOWLEDGMENT AND THE RIGHTS AND
OBLIGATIONS OF THE PARTIES HEREUNDER SHALL BE CONSTRUED IN ACCORDANCE WITH AND
GOVERNED BY THE LAW OF
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THE STATE OF NEW YORK WITHOUT GIVING EFFECT TO THE CONFLICT OF LAW PRINCIPLES
THEREOF.
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IN WITNESS WHEREOF, each of the parties hereto has caused a
counterpart of this SNIG Assumption Acknowledgment to be duly executed and
delivered as the date first above written.
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SUPERIOR NATIONAL INSURANCE
GROUP, INC., as SNIG
By J. XXXXX XXXXXX
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Name: J. Xxxxx Xxxxxx
Title: CFO
SUPERIOR NATIONAL INSURANCE
GROUP, INC., as Holdings
By J. XXXXX XXXXXX
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Name: J. Xxxxx Xxxxxx
Title: CFO
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THE CHASE MANHATTAN BANK,
as Collateral Agent
By XXXXX XXXXXXX
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Name: Xxxxx Xxxxxxx
Title: Vice President
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Acknowledge and Agreed to
this 11th day of April, 1997
CENTRE REINSURANCE LIMITED
By XXXXXXX X. XXXXX
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Name: Xxxxxxx X. Xxxxx
Title: Vice President
