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Consulting Agreement

This is an actual contract by American Bankers Insurance Group.
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Sectors: Insurance
Governing Law: Florida, View Florida State Laws
Effective Date: March 05, 1999
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CONSULTING AGREEMENT


THIS CONSULTING AGREEMENT (this "Agreement") is made this 5th day of March, 1999, by and between American Bankers Insurance Group, Inc., a Florida corporation (the "Company"), and Gerald N. Gaston (the "Consultant");


WHEREAS, the Company has entered into that certain Agreement and Plan of Merger, dated as of the date hereof (the "Merger Agreement"), by and among the Company, Fortis, Inc. and Greenland Acquisition Corp., pursuant to which Fortis, Inc. will acquire all of the issued and outstanding common stock of the Company, by virtue of the merger of Greenland Acquisition Corp. with and into the Company (the "Merger"); and


WHEREAS, as an inducement to Fortis, Inc. to enter into the Merger Agreement, Consultant has agreed to enter into this Agreement; and


WHEREAS, the Board of Directors of the Company has determined that it is in the best interests of the Company to enter into this Agreement.


NOW, THEREFORE, in consideration of the premises, $10.00 in hand paid and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties agree as follows:


1. CONSULTING ARRANGEMENT. Subject to the consummation of the transactions contemplated by the Merger Agreement, the Company hereby engages the Consultant for the term and upon the terms and subject to the conditions hereinafter set forth. The Consultant hereby accepts such engagement. The parties acknowledge and agree that for all purposes under and in connection with this Agreement, the Consultant shall be deemed an independent contractor and not an employee of the Company.


2. TERM. The Company shall retain the Consultant for the term of twenty-four (24) months commencing at the Effective Time (as defined in the Merger Agreement) (the "Minimum Term"). Following the expiration of the Minimum Term, the Consultant's retention by the Company shall continue only upon written agreement by both parties.


3. DUTIES. The Consultant's duties shall include consulting with officers of the Company, from time to time, upon the Company's request during regular business hours, as mutually agreeable to the Company and Consultant.


4. EXPENSES. The Consultant is authorized to incur reasonable business expenses in performing services requested by the Company under this Agreement. The Company shall promptly reimburse the Consultant for such expenses upon presentation of an itemized expense statement together with supporting vouchers therefor and such other information as the Company may from time to time reasonably require.


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5. OFFICE. The Company shall provide Consultant with reasonable office space in Coral Gables, Florida, in premises that are currently leased to the Company under a triple net lease, for the remainder of the initial five-year term of such lease, provided that the cost per year of such lease shall not exceed $175,000.


6. EXECUTIVE SEVERANCE CONTRACT PAYMENT. Consultant presently has an Executive Severance Contract with the Company, dated February 1, 1990 (the "Severance Agreement"). Immediately after the Effective Time, Consultant's employment with the Company shall terminate, this Agreement shall take effect, and the Company shall pay to the Consultant a lump sum of $8,045,000 as full payment of the Company's obligations under the Severance Agreement (subject to adjustment so that the amount received by the Consultant as a result of the Merger shall not exceed 2.99 times the Consultant's "base amount" as defined in Section 280G(b)(3) of the Internal Revenue Code of 1986, as amended).


7. PROPRIETARY PROPERTY; CONFIDENTIAL INFORMATION.


(a) PROPRIETARY PROPERTY. The term "Proprietary Property" includes any and all ideas, creations, developments, improvements, inventions, trade secrets, patents, copyrights, trademarks, trade names, logos, processes, computer programs, databases, spread sheets, documentation, models, methodologies, strategies, material works of authorship, know-how and methods of applying and putting into practice any such items that are created, developed or discovered by or for the Company or are acquired or licensed on a proprietary basis by the Company from others. Proprietary Property does not include proprietary technical information generally known in the business in which the Company operates, even if disclosed to the Consultant or known or developed by the Consultant as a consequence of or through the Consultant's performance of services hereunder.


(b) CONFIDENTIAL INFORMATION. The term "Confidential Information" includes any and all information that relates to the Company's products and services (including their development, marketing and sale), the financial, marketing and other aspects of the Company's operations, and the intellectual property and business and other rights that it owns, licenses or otherwise has the right to use, that is not generally known outside the Company (other than to the Company's customers or suppliers or other third parties in connection with their business with the Company) and that is disclosed or accessible to or known or developed by the Consultant as a consequence of or through the Consultant's performance of services hereunder or prior performance of services for the Company. It includes, but is not limited to, memoranda, files, books and records, financial and accounting methodologies, catalogs, lists of customers or prospects, price lists, advertising and promotional materials, pac
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