SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported) August 8, 1997
HOME HOLDINGS INC.
(Exact name of registrant as specified in its charter)
Delaware 0-19347 13-3584978
(State of Incorporation) (Commission file number) (I.R.S. Employer
Identification No.)
59 Maiden Lane, New York, New York 10038-4548
(Address or principal executive office) (Zip Code)
Registrant's telephone number including area code (212) 530-6600
Item 5. Other Events
The Registrant announced today that The Home
Insurance Company, a New Hampshire-domiciled property and
casualty stock insurance company and the principal,
wholly-owned subsidiary of the Registrant ("Home
Insurance"), has entered into an agreement to settle and
release its obligations to the National Council on
Compensation Insurance, Inc. (the "NCCI"), the National
Workers Compensation Reinsurance Pool (the "NWCRP") and
the NWCRP's participating companies.
The terms of the settlement agreement fully
release Home Insurance's obligations to the NCCI, NWCRP
and NWCRP participating companies, and will save Home
Insurance approximately $100 million. The settlement was
completed on Friday, August 8, after it was approved by
the New Hampshire Insurance Commissioner (the
"Commissioner"). As Home Insurance's principal
regulator, the Commissioner put Home Insurance under a
previously-disclosed Order of Supervision on March 3,
1997.
Item 7. Financial Statements, Pro Forma Financial
Information and Exhibits
(c) Exhibits.
(10.1) Form of Settlement Agreement.
(99.1) Press release issued on August 11,
1997.
Pursuant to the requirements of the Securities
Exchange Act of 1934, the Registrant has duly caused this
report to be signed on its behalf by the undersigned
hereunto duly authorized.
HOME HOLDINGS INC.
Dated: August 11, 1997 By: /s/ Richard H. Hershman
Richard H. Hershman
(Principal Financial and
Accounting Officer through the
Services Agreement, dated June
12, 1995, between Risk
Enterprise Management Limited, a
Delaware corporation, and Home
Insurance)
Exhibit 10.1
SETTLEMENT AND RELEASE AGREEMENT
THIS SETTLEMENT AND RELEASE AGREEMENT (the "Settlement
Agreement") is made as of the ___ day of August, 1997, by and
among The Home Insurance Company, a New Hampshire domiciled
property and casualty insurance company in run-off ("Home
Insurance"), Risk Enterprise Management Limited, a Delaware
corporation that provides management services to Home Insurance
("REM"), and Centre Reinsurance Dublin, a corporation organized
under the laws of the Republic of Ireland ("Centre Re Dublin"),
on the one hand, and the participating companies subscribing to
the Articles of Agreement adopted on January 1, 1970 and most
recently amended effective January 1, 1993 (the "Articles of
Agreement") establishing the National Workers Compensation
Reinsurance Pool (collectively, the "NWCRP" and each subscribing
company individually, a "Participant") and the National Council
on Compensation Insurance, Inc., a Florida corporation (the
"NCCI"), Administrator for the NWCRP and attorney-in-fact for
each Participant, on the other hand (all of the parties hereto
collectively, the "Parties" and each party hereto individually, a
"Party").
WHEREAS, Home Insurance provided workers compensation
insurance pursuant to various federal and state laws, and
participated in the NWCRP as a signatory to the Articles of
Agreement (a copy of which is attached hereto as Exhibit A);
WHEREAS, Home Insurance and the NWCRP have been involved in
a dispute regarding, in relevant part, the amounts alleged to be
due and owing to the NWCRP by Home Insurance arising from the
participation by Home Insurance in the NWCRP pursuant to the
Articles of Agreement (the "Dispute");
WHEREAS, pursuant to Article V, Section 1, of the Articles
of Agreement, the operation, business and affairs of all matters
arising under the Articles of Agreement are managed and
controlled by the Board of Governors of the NWCRP;
WHEREAS, the Board of Governors of the NWCRP (the "Board of
Governors"), on behalf of the NWCRP, has entered into the
Administration Agreement with the NCCI, effective January 1, 1997
(the "Administration Agreement") (a copy of which is attached
hereto as Exhibit B), designating the NCCI as Administrator of
the NWCRP;
WHEREAS, pursuant to Article V, Section 7, of the Articles
of Agreement, in addition to the other powers conferred upon the
Board of Governors by the Articles of Agreement, the Board of
Governors has "full authority to pass upon all disputes arising
with respect to these Articles of Agreement, including without
limitation any questions as to the application, scope, and effect
of these Articles of Agreement".
WHEREAS, pursuant to Article V, Section 9, of the Articles
of Agreement, the NCCI, as Administrator, is authorized to enter
into agreements on behalf of the Participants to carry out the
purposes of the Articles of Agreement, and upon the direction of
the Board of Governors, is empowered to act as attorney-in-fact
for each Participant to settle and to propose or to accept a
compromise with respect to any claim existing in favor of, or
against, the NWCRP and each Participant based on or involving any
matter relating to the Articles of Agreement;
WHEREAS, on or about May 23, 1997, the NCCI, as
Administrator of the NWCRP, and upon direction of the Board of
Governors, filed suit against Home Insurance in the Supreme Court
of the State of New York, New York County, alleging claims
related to or arising out of the Dispute, the participation of
Home Insurance in the NWCRP and the Articles of Agreement;
WHEREAS, the Board of Governors, on behalf of the NWCRP and
each Participant, and the NCCI have engaged in settlement
negotiations with Home Insurance and REM in order to resolve the
Dispute;
WHEREAS, the Parties desire to finally, permanently,
unconditionally and irrevocably settle, resolve and put to rest
all claims and causes of action between them in any way relating
to or arising from the Dispute, the participation of Home
Insurance in the NWCRP or the Articles of Agreement;
WHEREAS, on August 5, 1997, the Board of Governors, by a
written resolution (the "Resolution") (a copy of which is
attached hereto as Exhibit C) authorized and directed the NCCI,
as administrator for the NWCRP and attorney-in-fact for each
Participant, and the Chair of the Board of Governors of the NWCRP
to enter into the Settlement Agreement and the transactions
contemplated thereby on behalf of the NWCRP and each Participant,
all of which shall be bound thereby;
WHEREAS, Centre Re Dublin and Home Insurance have entered
into an Aggregate Excess of Loss Reinsurance Agreement, dated as
of June 12, 1995 (the "AEOLRA"), under which Centre Re Dublin
provides reinsurance coverage to Home Insurance (a copy of which
is attached hereto as Exhibit D);
WHEREAS, the Commissioner issued an Order of Supervision,
dated March 3, 1997, under which, in relevant part, the
Commissioner has final authority to approve, disapprove or
otherwise control (including the power to direct) the settlement
of any dispute of any kind involving Home Insurance other than in
the ordinary course of business;
WHEREAS, the Commissioner has given his written approval (a
copy of which is attached hereto as Exhibit E) of the settlement
of the Dispute on the terms and conditions set forth herein and
the payment by Home Insurance of the Initial Settlement Amount
(as defined in Section 1 hereof); and
WHEREAS, the most recent quarterly statutory financial
statement filed by Home Insurance with the Commissioner (the
"Financial Statement") shows a statutory surplus of approximately
$30 million, which statutory surplus includes an adjustment for
(i) the amount of the reinsurance coverage provided to Home
Insurance under the AEOLRA reflected as an asset on the books and
records of Home Insurance and (ii) a discounting of loss reserves
(which discounting was approved by the Commissioner in writing, a
copy of which approval is attached hereto as Exhibit F), both of
which adjustments were incorporated in the Financial Statement.
NOW THEREFORE, in consideration of the representations,
warranties, covenants and mutual promises contained herein, the
Parties hereby agree as follows:
(1) Payments.
(a) Simultaneously with the execution and delivery of
the Settlement Agreement, Home Insurance shall pay the NCCI (for
the benefit of the NWCRP and the Participants) $60,000,000.00
(the "Initial Settlement Amount"), and shall transfer such amount
to the Account (as defined below) on the date of the Settlement
Agreement.
(b) Subject to the Conditions (as defined in Section 2
below), Centre Re Dublin shall pay the NCCI or a successor
administrator, as applicable (for the benefit of the NWCRP and
the Participants), the following additional amounts (each an
"Additional Settlement Amount" and, together with the Initial
Settlement Amount, the "Settlement Amounts") and shall transfer
such amounts to the Account as follows:
i) $23,333,333.34 on December 31, 2032;
ii) $23,333,333.34 on December 31, 2037; and
iii) $23,333,333.34 on December 31, 2042.
(c) The Parties hereby acknowledge and agree that any
payment made by Centre Re Dublin under the Settlement Agreement
shall be deemed to be a payment of Ultimate Loss in respect of,
arising under or related to, the Subject Obligations subject to
the Aggregate Limit (as all such terms are defined in the
AEOLRA).
(d) The Parties hereby further acknowledge and agree
that any dividend payments declared or made by Home Insurance in
violation of Section 12 hereof shall not be considered a Subject
Obligation under the AEOLRA.
(e) Payments of the Settlement Amounts shall be in
United States dollars and shall be made by wire transfer to the
following account (the "Account"), or such other account as may
be designated by the NCCI, or a successor administrator, as
applicable, in accordance with the Settlement Agreement:
[ACCOUNT]
(2) Conditions. The payment of any amount under the
Settlement Agreement, except the Initial Settlement Amount (which
payment has been made simultaneously with the execution and
delivery hereof), shall be made, in whole or in part, only upon
the satisfaction of all of the following conditions
(collectively, the "Conditions"):
(a) that the Commissioner has approved such payment,
in his or her sole discretion; in no event shall any of the
Settlement Amounts be paid without the prior approval of the
Commissioner, which approval shall not be unreasonably withheld;
(b) after any and all existing and future indebtedness
and other claims on the assets of Home Insurance, including all
insurance policies and existing and future indebtedness issued,
incurred or guaranteed by Home Insurance, have been paid and no
liabilities that would be considered Subject Obligations remain
outstanding; and
(c) if, and only to the extent that, immediately prior
to the payment of each Additional Settlement Amount, (x) Home
Insurance has coverage remaining under Article 8 of the AEOLRA
and (y) payments made by or on behalf of Centre Re Dublin under
the AEOLRA shall not have exceeded the Aggregate Limit (as
defined in Article 8 of the AEOLRA) (calculated after taking into
account the effect of Sections (1)(c) and (1)(d) hereof on
Subject Obligations (as defined in Article 2 of the AEOLRA),
Ultimate Loss (as defined in Article 7 of the AEOLRA) and the
Aggregate Limit); provided, further, that, at the time payment of
any Additional Settlement Amount is due, no liabilities of Home
Insurance that would be considered Subject Obligations under
Article 2 of the AEOLRA remain outstanding; in no event shall
Centre Re Dublin be liable for, or have any obligation whatsoever
to pay, any amounts in excess of the Aggregate Limit as a result
of the Settlement Agreement (calculated after taking into account
the operation of subsections 1(c) and 1(d) hereof).
(3) NCCI and NWCRP General Release. Subject to the
provisos set forth in this Section 3 hereof, the NCCI, the NWCRP
and each Participant hereby fully, completely, knowingly,
voluntarily, unconditionally and irrevocably (i) release, acquit
and forever discharge Home Insurance, Centre Re Dublin and REM
from, (ii) covenant not to sue Home Insurance, Centre Re Dublin
or REM with respect to, and (iii) waive any rights with respect
to: (a) any and all charges, complaints, claims, liabilities,
obligations, promises, agreements, controversies, damages,
actions, causes of action, suits, rights, demands, costs, losses,
debts and expenses of any nature whatsoever, known or unknown,
suspected or unsuspected, foreseen or unforeseen, matured or
unmatured, which, from the beginning of the world up to and
including the date hereof, exist, have existed, or may arise from
any matter whatsoever which the NCCI, the Board of Governors, the
NWCRP or any of the Participants ever had, now have, or at any
time hereafter may have, own or hold against Home Insurance,
Centre Re Dublin or REM, including any and all obligations to the
NWCRP arising under assigned risk plans and/or workers'
compensation insurance plans approved and/or implemented by the
states, as set forth in Schedule I annexed hereto, for the policy
years indicated therein (collectively, the "Liabilities"); and
(b) without limiting the definition of Liabilities set forth in
this Section 3 hereof, any and all obligations of any kind
whatsoever, including, but not limited to, expenses, fees, costs,
assessments, penalties or charges, in any way relating to,
arising from or in connection with the participation by Home
Insurance in the NWCRP pursuant to the Articles of Agreement, as
the same may be amended from time to time, or pursuant to any
other governing document signed or adopted by the NWCRP, the
Board of Governors or the Participants, at any time in effect;
provided, however, that nothing herein shall release any Party
from any of its obligations under the Settlement Agreement;
provided, further, however, that no release is granted hereunder
with respect to (i) any Liabilities that may be owed or become
due and owing to any Participant or to the NCCI from Home
Insurance, Centre Re Dublin or REM, in connection with matters
not related to or arising from the Dispute, Home Insurance's
participation in the NWCRP or the Articles of Agreement; (ii) in
the case of Home Insurance, any fee or other assessment directly
attributable to any new insurance policy written by Home
Insurance after the date hereof or renewal of any existing
insurance policy by Home Insurance after the date hereof; and
(iii) any Liabilities that may be owed or become due and owing in
connection with any assigned risk or workers' compensation
insurance pool in the Commonwealth of Massachusetts with respect
to any policy year after 1990, the State of Michigan with respect
to any policy year after 1982 and the State of New Mexico; and
provided, further, however, that any rights and obligations that
may otherwise exist between the NCCI and the NWCRP, on the one
hand, and Home Insurance, on the other hand, with respect to any
remaining servicing carrier activities of Home Insurance shall
remain in full force and effect.
(4) [Intentionally left blank.]
(5) Definitions for Certain Sections of the Settlement
Agreement.
(a) For the purposes of the Settlement Agreement, the
terms "Home Insurance", "REM" and "Centre Re Dublin" include any
and all predecessors thereof and for the purposes of Section 3 of
the Settlement Agreement, the term "Centre Re Dublin" shall also
include any entities which are members of the Zurich Insurance
Group and the affiliates thereof (the "Zurich Insurance Group");
provided, however, that pursuant to Section 3 of the Settlement
Agreement, the Zurich Insurance Group shall be released from any
and all Liabilities arising from, in connection with or related
to (i) the Dispute, (ii) Home Insurance's participation in the
NWCRP or the Articles of Agreement and (iii) Centre Re Dublin s
relationship with Home Insurance or REM, and not with respect to
the Zurich Insurance Group's independent participation in the
NWCRP and the Articles of Agreement.
(b) For the purposes of the Settlement Agreement, the
terms "NWCRP", "NCCI" and "Participant" include any and all
predecessors thereof and, in the case of the NWCRP, any entity or
pool the rights and obligations of which have been assumed or
reinsured thereby, and also including, in the case of the NWCRP,
all such pools set forth on Schedule II attached hereto; but not
including, in the case of the NWCRP, any entity or pool the
rights and obligations of which have not been assumed or
reinsured thereby.
(c) For the purposes of Sections 3 and 11 of the
Settlement Agreement, the terms "Home Insurance", "REM", "Centre
Re Dublin", "NWCRP", "NCCI" and "Participant" include any and all
present and future successors, assigns and affiliates thereof,
and the respective employees, officers, directors, shareholders,
agents and representatives of all of the foregoing, respectively.
(6.1) Representations and Warranties of the NCCI, the
NWCRP and each Participant.
The NCCI and the NWCRP (collectively and on behalf of each
Participant) hereby represent and warrant as follows:
(a) each of the NCCI and the NWCRP has all requisite
legal power and authority to execute, deliver and perform the
Settlement Agreement and the transactions contemplated hereby, on
behalf of themselves and each Participant, and to bind the NCCI,
the NWCRP and each Participant thereto;
(b) the execution, delivery and performance of the
Settlement Agreement and the performance of the transactions
contemplated hereby, including, without limitation, the general
release granted pursuant to Section 3 hereof, have been duly
authorized by all requisite legal or other action by the NCCI,
the Board of Governors and the NWCRP;
(c) the Settlement Agreement has been duly and validly
executed and delivered by the NCCI and NWCRP (collectively and on
behalf of each Participant), and constitutes the valid and
binding obligation of the NCCI, the NWCRP and each Participant
enforceable against the NCCI, the NWCRP and each Participant in
accordance with its terms, subject to the provisions of Section 9
hereof, and except as such enforceability may be limited by
applicable bankruptcy, insolvency, reorganization, moratorium,
conservatorship or other similar laws affecting the enforcement
of creditors' rights in general;
(d) the execution, delivery and performance of the
Settlement Agreement and the performance of the transactions
contemplated hereby by the NCCI, the NWCRP and each Participant,
including, without limitation, the general release granted
pursuant to Section 3 hereof, will not, with or without giving of
notice or the lapse of time, or both, violate (i) any provision
of law, rule or regulation relating to the enforceability of the
Settlement Agreement to which the NCCI, the Board of Governors,
the NWCRP or each Participant is subject or (ii) the Articles of
Agreement or the Administration Agreement;
(e) each of the NCCI and the Board of Governors has
all requisite legal power and authority to bind the NWCRP and
each Participant to the terms and conditions of the Settlement
Agreement, including, without limitation, the general release
granted pursuant to Section 3 hereof; and
(f) the Articles of Agreement, the Administration
Agreement and the Resolution is in full force and effect on and
as of the date hereof, constitute the sole governance documents
relevant to the representations and warranties of the NCCI, the
NWCRP and the Participants set forth in Section 6.1 hereof and
(x) the Articles of Agreement have been continuously in effect
and have not been amended since January 1, 1993, (y) the
Administration Agreement has been continuously in effect and has
not been amended since January 1, 1997 and (z) the Resolution
remains in effect and has not been amended.
(6.2) Representations and Warranties of Centre Re
Dublin, Home Insurance and REM.
Centre Re Dublin, Home Insurance and REM hereby represent
and warrant as follows:
(a) each of Centre Re Dublin, Home Insurance and REM
has all requisite legal power and authority to execute, deliver
and perform the Settlement Agreement and the transactions
contemplated hereby;
(b) the execution, delivery and performance of the
Settlement Agreement and the performance of the transactions
contemplated hereby have been duly authorized by all requisite
legal or other action by Centre Re Dublin, Home Insurance and
REM;
(c) the Commissioner has approved the terms and
conditions of the Settlement Agreement, which approval was
granted on August __, 1997;
(d) the Settlement Agreement has been duly and validly
executed and delivered by Centre Re Dublin, Home Insurance and
REM and constitutes the valid and binding obligation of each of
Centre Re Dublin, Home Insurance and REM enforceable against each
of them in accordance with its terms, subject to the provisions
of Section 9 hereof, and except as such enforceability may be
limited by applicable bankruptcy, insolvency, reorganization,
moratorium, conservatorship or other similar laws affecting the
enforcement of creditors' rights in general; and
(e) the execution, delivery and performance of the
Settlement Agreement and the performance of the transactions
contemplated hereby by Centre Re Dublin, Home Insurance and REM
will not, with or without the giving of notice, or the lapse of
time, or both, violate any provision of law, rule or regulation
relating to the enforceability of the Settlement Agreement to
which Centre Re Dublin, Home Insurance or REM are subject.
(7) [Intentionally left blank.]
(8) Dismissal of Pending Claims. Upon the execution and
delivery by Home Insurance of the Settlement Agreement, the NCCI
and the NWCRP shall promptly take any and all necessary steps to
dismiss with prejudice the matter of NCCI, as Administrator for
the NWCRP, v. Home Insurance, currently pending in the Supreme
Court of the State of New York, New York County (the "Court").
The NCCI shall promptly serve Home Insurance and REM with copies
of all papers at the time they are filed with the Court and again
after they are executed and returned by the Court.
(9) Termination of the Settlement Agreement. The
Settlement Agreement shall be terminated and deemed null and
void, and the Parties shall be released from all obligations
hereunder, including, without limitation, the general releases
granted pursuant to Section 3 hereof and the payment of the
Additional Settlement Amounts pursuant to Section 1 hereof, if
the Commissioner or a custodian, receiver, trustee, liquidator or
similar official appointed by the Commissioner or a court of
competent jurisdiction under the liquidation provisions of any
state or state insurance laws or under Title 11 of the United
States Code or any similar federal or state law for relief,
supervision, conservation, reorganization, or liquidation of
debtors for the benefit of creditors ("Bankruptcy Law"), recovers
the full Initial Amount Due in any judicial or administrative
insolvency proceeding under any Bankruptcy Law.
(10) Prepayment and Acceleration.
(a) The Additional Settlement Amounts are not subject
to prepayment at the option of Home Insurance, Centre Re Dublin
or the NCCI unless Home Insurance, the NCCI and Centre Re Dublin
have expressly agreed in writing otherwise, and the Commissioner
has approved such agreement, such approval at the sole discretion
of the Commissioner.
(b) Payment of the Additional Settlement Amounts is
not subject to any form of acceleration upon the occurrence of
any event.
(11) Covenant. The NCCI, the NWCRP and each Participant
shall not, at any time, take, or authorize any other entity to
take, any action, the effect of which would violate or negate the
terms and conditions of the Settlement Agreement, including,
without limitation, the general release granted pursuant to
Section 3 hereof.
(12) Payment of Dividends. At any time after all of the
Conditions have been satisfied, Home Insurance shall not declare
or pay dividends to shareholders for the purpose of avoiding the
payment of any Additional Settlement Amount by Centre Re Dublin.
(13) No Admission of Liability. The Parties hereby
acknowledge and agree that the Settlement Agreement and the
transactions contemplated hereby shall not constitute an
admission of guilt, wrongdoing or liability on the part of any
Party, or an adjudication of the merits of the Dispute, and shall
not be used or construed as such.
(14) No Covenants. The Parties hereby acknowledge and agree
that, except as expressly set forth in Sections 1 and 12 hereof,
the Settlement Agreement does not subject Home Insurance, REM or
Centre Re Dublin to any express or implied covenants of any kind
whatsoever including, without limitation, covenants with respect
to (i) incurring, assuming or becoming liable with respect to any
indebtedness or other obligations, whether secured or unsecured;
(ii) being required to adhere to any financial ratio or specified
level of liquidity; and (iii) declaring or making of dividend
payments.
(15) Further Assurances. Each Party hereby agrees to
execute and deliver any additional instruments or documents or to
take such further actions as any of the other Parties may
reasonably request to effectuate the purposes and intent of the
Settlement Agreement and the consummation of the transactions
contemplated hereby.
(16) Understanding of the Parties. The Settlement Agreement
constitutes the sole and complete understanding of the Parties
with respect to the subject matter hereof. The Parties represent
to each other that in executing the Settlement Agreement, they do
not rely and have not relied upon any representation or statement
not set forth herein made by any other Party, including such
other Party's agents, representatives or attorneys, with regard
to the subject matter, basis or effect of the Settlement
Agreement. Section headings in the Settlement Agreement are for
purposes of reference only and shall not affect the
interpretation or construction of any of the provisions hereof.
The word "including" is not limiting. Any word or term used or
defined in the Settlement Agreement in any form shall be singular
or plural, as the context requires.
(17) Binding Effect. The terms and conditions of the
Settlement Agreement shall inure to the benefit of and be binding
upon the respective predecessors and present and future
successors, assigns, administrators or heirs (as applicable) of
each Party (collectively, the "Party Assignees"), and any and all
past, present and future directors, officers, shareholders,
managers, agents, representatives, advisors, consultants,
employees, subsidiaries, administrators or heirs (as applicable)
of each Party or Party Assignee and their respective past,
present and future successors, assigns, affiliates or heirs (as
applicable).
(18) Assignability. Neither the Settlement Agreement nor
the rights, benefits, obligations or liabilities hereunder are
transferable or assignable by any of the Parties hereto without
the prior written consent of all of the other Parties hereto.
(19) Amendment, Waiver and Delay. No amendment,
modification or alteration of the terms and provisions of the
Settlement Agreement shall be binding unless the same shall be in
writing and duly executed by the Parties. No waiver of any of
the provisions of the Settlement Agreement shall be deemed to or
shall constitute a waiver of any other provision hereof. No
delay on the part of any Party in exercising any right, power or
privilege hereunder shall operate as a waiver thereof.
(20) Choice of Law and Venue. The Settlement Agreement
shall be governed by, and construed and enforced under, the laws
of the State of New York, without regard to its conflict of laws
rules. Each Party hereby irrevocably and unconditionally
consents to submit to the exclusive jurisdiction of the courts of
the State of New York and of the United States of America, in
each case located in the County of New York, for any litigation
arising out of or relating to the Settlement Agreement (and
agrees not to commence any litigation relating thereto except in
such courts), and further agrees that service of any process,
summons, notice or document by United States registered mail to
its respective address set forth in the Settlement Agreement
shall be effective service of process for any litigation brought
against it in any such court. Each Party hereby irrevocably and
unconditionally waives any objection to the laying of venue of
any litigation arising out of the Settlement Agreement in the
state or federal courts in the State of New York, and hereby
further irrevocably and unconditionally waives and agrees not to
plead or claim in any such court that any such litigation brought
in any such court has been brought in an inconvenient forum.
(21) Severability. In the event that any one or more of the
provisions of the Settlement Agreement is held to be invalid,
illegal or unenforceable, the validity, legality and
enforceability of the remaining provisions shall not in any way
be affected or impaired thereby. If any one or more of the
provisions contained in the Settlement Agreement is held to be
excessively broad as to duration, scope, activity or subject,
such provision shall be construed by limiting and reducing it so
as to be enforceable to the maximum extent compatible with
applicable law.
(22) Notices. All notices and other communications
hereunder shall be in writing and shall be deemed effective or
given upon (i) electronic confirmation when sent by facsimile
transmission, (ii) confirmed delivery by a recognized courier
service or an affidavit of the messenger when delivered by hand,
or (iii) the expiration of seven (7) calendar days after the day
when mailed by certified or registered mail, postage prepaid,
addressed to the following addresses (or at such other address
for a Party as shall be specified by like notice):
(a) If to the NCCI, the NWCRP, the Board of Governors
or the Participants, to:
National Council on
Compensation Insurance, Inc.
750 Park of Commerce Drive
Boca Raton, Florida 33487
Attn.: Mr. Keith T. Shoemaker
Vice President,
Residual Market Operations
Telephone: (561) 997-4600
Telecopy: (561) 997-4655
with copies to:
Thomas Jenkins, Esq.
Michael R. Hassan, Esq.
Lord, Bissell & Brook
115 South LaSalle
Chicago, Illinois 60603
Telephone: (312) 443-0777
Telecopy: (312) 443-0336
(b) If to Home Insurance or REM, to:
The Home Insurance Company
59 Maiden Lane
New York, New York 10038
Attn.: General Counsel
Telephone: (212) 530-6600
Telecopy: (212) 530-3413
If to Centre Re Dublin, to:
Centre Reinsurance Dublin
IFSC House
Custom House Quay
Dublin 1, Ireland
Attn.: President
Telephone: 353-1-670-0755
Telecopy: 353-1-670-1102
with copies to:
Zurich Centre ReSource Limited
One Chase Manhattan Plaza
New York, New York 10005
Attn.: General Counsel
Telephone: (212) 898-5350
Telecopy: (212) 898-5405
(23) Counterparts. The Settlement Agreement may be executed
in counterparts, each of which shall for all purposes be deemed
to be an original and all of which shall constitute the same
instrument.
IN WITNESS WHEREOF, the undersigned have duly executed this
Settlement Agreement as of the date first written above.
NATIONAL COUNCIL ON COMPENSATION
INSURANCE, INC., ADMINISTRATOR OF THE NATIONAL
WORKERS COMPENSATION REINSURANCE POOL AND
ATTORNEY-IN-FACT FOR EACH PARTICIPANT
By: _________________________________
Name: Keith T. Shoemaker
Title: Vice President, Residual Market
Operations
THE NATIONAL WORKERS COMPENSATION
REINSURANCE POOL
By: _________________________________
Name: James A. Hannes
Title: Chair of the Board of Governors of
the National Workers Compensation
Reinsurance Pool
THE HOME INSURANCE COMPANY
By: _________________________________
Name: Charles E. Callahan
Title: President & Chief Operating Officer
RISK ENTERPRISE MANAGEMENT LIMITED
By: _________________________________
Name: Richard H. Hershman
Title: Executive Vice President,
Chief Financial Officer & Treasurer
CENTRE REINSURANCE DUBLIN
By: _________________________________
Name:
Title:
CENTRE REINSURANCE DUBLIN
By: _________________________________
Name:
Title:
Schedule I
YEAR OF
POOL NAME STATE PARTICIPATION
National Workers Compensation
Reinsurance Pool
Alabama 1970 to 1995
Arizona 1970 to 1995
Arkansas 1970 to 1995
California 1970 to 1977
Colorado 1970 to 1994
Connecticut 1970 to 1995
Delaware 1970 to 1995
District of
Columbia 1970 to 1995
Florida 1970 to 1993
Georgia 1970 to 1995
Idaho 1970 to 1995
Illinois 1970 to 1995
Indiana 1970 to 1995
Iowa 1970 to 1995
Kansas 1970 to 1995
Kentucky 1970 to 1995
Louisiana 1970 to 1992
Maine 1970 to 1986
Maryland 1970 to 1994
Massachusetts 1970 to 1990
Michigan 1970 to 1982
Mississippi 1970 to 1992
Missouri 1970 to 1995
Montana 1970 to 1994
Nebraska 1970 to 1995
New Hampshire 1970 to 1995
New Jersey 1970 to 1995
North Carolina 1970 to 1995
Oklahoma 1970 to 1994
Oregon 1970 to 1995
Pennsylvania 1970 to 1994
Rhode Island 1970 to 1992
South Carolina 1970 to 1995
South Dakota 1970 to 1995
Tennessee 1970 to 1995
Utah 1970 to 1994
Vermont 1970 to 1995
Virginia 1970 to 1995
Washington 1970 to 1993
Wyoming 1970 to 1994
Hawaii 1970 to 1995
Alaska 1970 to 1995
Maine Workers Compensation
Reinsurance Pool
Maine 1987 to 1987
Alabama Coal Mine Pool
Alabama 1970 to 1982
Illinois Coal Mine Pool
Illinois 1970 to 1982
Iowa Coal Mine Pool
Iowa 1970 to 1982
Tennessee Coal Mine Pool
Tennessee 1970 to 1982
Virginia Coal Mine Pool
Virginia 1970 to 1982
Alaska Assigned Risk Pool
Alaska 1970 to 1983
Arkansas Stock Pool
Arkansas 1970 to 1983
Illinois Stock Pool
Illinois 1970 to 1982
Pennsylvania Plan Pool
Pennsylvania 1982 to 1983
Schedule II
Maine Workers Compensation Reinsurance Pool
Alabama Coal Mine Pool
Illinois Coal Mine Pool
Iowa Coal Mine Pool
Kentucky Coal Mine Pool
Tennessee Coal Mine Pool
Virginia Coal Mine Pool
Alaska Assigned Risk Pool
Arkansas Stock Pool
Illinois Stock Pool
Pennsylvania Plan Pool
EXHIBIT LIST
1. EXHIBIT A - Articles of Agreement adopted on January 1, 1970
and most recently amended effective January 1, 1993
establishing the National Workers Compensation
Reinsurance Pool.
2. EXHIBIT B - Administration Agreement effective January 1,
1997 between the National Council on Compensation
Insurance, Inc. and the National Workers
Compensation Reinsurance Pool.
3. EXHIBIT C - Resolution dated as of August 5, 1997 of the
Board of Governors of the National Workers
Compensation Reinsurance Pool.
4. EXHIBIT D - Aggregate Excess of Loss Reinsurance Agreement
dated as of June 12, 1995 between Centre
Reinsurance Dublin and The Home Insurance Company.
5. EXHIBIT E - Written Approval of the Commissioner of the
Insurance Department of the State of New Hampshire.
6. EXHIBIT F - Written Approval of the Commissioner of the
Insurance Department of the State of New Hampshire
regarding discounting of loss reserves.
Exhibit 99.1
FROM: EDWARD G. NOVOTNY & ASSOCIATES, INC.
Two Tudor City Place
New York, NY 10017
Tel: 212/490-2065
FOR: HOME HOLDINGS INC. FOR IMMEDIATE RELEASE
59 Maiden Lane Monday, August 11, 1997
New York, NY 10038
HOME INSURANCE SETTLES DISPUTE
WITH NCCI AND NATIONAL WORKERS
COMPENSATION REINSURANCE POOL
NEW YORK Home Holdings Inc. announced today that
its principal subsidiary, The Home Insurance Company, has
entered into an agreement to settle and release its
obligations to the National Council on Compensation
Insurance, Inc., the National Workers Compensation
Reinsurance Pool and the National Pool's participating
companies.
The terms of the settlement agreement fully release
Home Insurance's obligations and will save the company
approximately $100 million. The settlement was completed
on Friday, August 8, after it was approved by the New
Hampshire Insurance Commissioner, Home Insurance's
principal regulator. Home Insurance's run-off has been
under the Commissioner's formal supervision since March,
1997.
