DIRECTORS AND OFFICERS LIABILITY ENDORSEMENT (Co-operative Apartment House and Condominiums)

Transcription

1 BUSINESSOWNERS THIS ENDORSEMENT CHANGES THE POLICY. PLEASE READ IT CAREFULLY. DIRECTORS AND OFFICERS LIABILITY ENDORSEMENT (Co-operative Apartment House and Condominiums) This endorsement modifies insurance provided under the following: BUSINESSOWNERS POLICY This endorsement shall apply to the insured and its Directors, Officers, and Trustees and Managing Board as herein defined; and the limits of the Company s liability are those stated on the Declarations page. Retention: $500 Insured s Participation: 5% The Company agrees with the Insured named in the Declarations in consideration of the payment of the premium of $ and subject to the insuring agreements, exclusions and conditions of this endorsement. INSURING AGREEMENTS I. COVERAGE To pay on behalf of the insured any loss subject to the limitations, conditions and other terms of this endorsement, which the insured shall become legally obligated to pay. A. Corporate Indemnification - Because of any civil claim or claims made against the insured s Directors, Officers, Trustees or Managing Board and caused by any negligent act, any error, any omission or breach of duty of Directors, Officers, Trustees or the Managing Board as defined in paragraph A. of Insuring Agreements II. DEFINITIONS, while acting in their capacities as such: B. Directors and Officers Liability - As damages because of any civil claim or claims made against the insureds and caused by any negligent act, any error, any omission, or breach of duty while acting in their capacities of Directors, Officers, Trustees or members of the Managing Board and the Company shall have the sole right and duty to defend such claims or suits against the insured seeking damages on account of such loss, even if any of the allegations of the suit are groundless, false or fraudulent, and may make such investigation and settlement of any claim or suit as it deems expedient, but the Company shall not be obligated to pay any claim or judgment or to defend any suit after the applicable limitation of the Company s liability has been exhausted by payment of judgments or settlements. The Company will pay, in addition to such damages, as much of the following as is within the applicable limit of liability: CIC 747 (1/95) Page 1 of 6

2 (1) All expenses incurred by the company, all costs taxed against the insured in any suit defended by the Company and all interest on the entire amount of any judgment therein which accrues after entry of the judgment and before the Company has paid or tendered or deposited in court that part of the judgment which does not exceed the limit of the Company s liability thereon. (2) Premiums on appeal bonds required in any such suit, premiums on bonds to release attachments in any such suit for an amount not in excess of the applicable limit of liability of this endorsement. II. DEFINITIONS: A. The term Directors means all Directors of the Corporation(s) named in Item 1 of the Declarations. The term Officers means all Officers of the Corporation(s) named in Item 1 of the Declarations. The term Trustees means all Trustees of the insured Trust named in Item 1 of the Declarations. The term Managing Board means all members of the Managing Board named in Item 1 of the Declarations. B. The word insured means: Under Coverage 1A - the Corporation(s), Trust(s) or Association(s) named in Item 1 of the Declarations, which may include subsidiaries acquired or created after the inception of this endorsement, provided the Company is notified promptly of, but not more than 30 days, after such additions. The endorsement also covers the insured with respect to persons deceased or persons who are no longer Directors or Officers of the Corporation(s) or Trustees of the Trust(s) or members of the Managing Board of the Association(s) at the time of discovery of an occurrence giving rise to a claim hereunder, but who were at such time when negligent acts, errors, omissions or breach of duty upon which a claim is based were committed. Under Coverage 1B - All persons who at the inception of this endorsement are or may thereafter be Officers or Directors of the Corporation(s) or Trustees of the Trust(s) or members of the Managing Board of the Association(s) named in Item 1 of the Declarations, which may include Officers and Directors and Trustees and members of the Managing Board of subsidiaries acquired or created after the inception of this endorsement provided the Company is notified promptly of, but not more than 30 days after, such additions. III. ENDORSEMENT PERIOD: This endorsement applies to any negligent acts, any errors, omissions or breach of duty which occur: A. During the endorsement period, and then only if claim is made or suit is brought during the endorsement period. If during the endorsement period the insured shall have acknowledged or become aware of any negligent act, any error, any omission or breach of duty shall, during the endorsement period, give written notice to the Company, then such notice shall be considered a claim hereunder; or CIC 747 (1/95) Page 2 of 6

3 B. Prior to the endorsement period, if claim is made or suit is brought during the endorsement period, and providing (a) the insured at the effective date of the endorsement had no knowledge or could not have reasonably foreseen any circumstance which might result in a claim or suit; and (b) there is no other insurance applicable to such negligent act, error, omission or breach of duty. If the Company shall cancel or refuse to renew the policy of which this endorsement forms a part, the coverage granted by this endorsement may be extended, at the option of the insured upon payment of an additional premium of 25% of the annual premium hereunder, to cover the insured with respect to any claim or claims which may be made against the insured during the period of 12 calendar months after the date of such cancellation or refusal, but only with respect to any negligent act, any error, any omission or breach of duty occurring during the endorsement period. EXCLUSIONS This endorsement does not apply to claims: A. For libel or slander. B. For an accounting of profits or losses made from the purchases or sale of securities under (1) the Federal Securities Act of 1933, the Security Exchange Act of 1934, the Public Utilities Holding Company Act of 1935, the Investment Company Act of 1940, or to any amendments of or additions to any of these acts; or (2) the so-called Blue Sky Laws of any state, as the same now exist or may be amended; or (3) the rules and regulations of any security, commodity or similar exchange; or (4) any statute or regulation of any Province in the Dominion of Canada or any statute or regulation of the Federal Government of Canada relating to the purchase, sale or disposition of securities. C. For salary, compensation or bonuses (excluding underwriting and brokerage commissions or concessions) voted to Officers or Directors by the Board of Directors of the Compensation or to Trustees by the Trustees of the Trust or to members of the Managing Board by the Managing Board of the Association. D. For anything other than money damages. E. Based on or attributable to any (1) negligent act, any error, any omission or breach of duty in judgment or discretion in procuring and maintaining insurance; or (2) failure or omission in effecting and maintaining insurance; or (3) negligent act, error, omission or breach of duty with respect to amount, form, conditions or provisions of insurance. F. For damages payable in connection with any transactions of the insured out of which such insured shall have gained any personal profit or advantage which is not shared equally by the stockholders or members of the Corporation or beneficiaries of the Trust or members of the Association. G. For loss due to or arising out of nuclear reaction, nuclear radiation or radioactive contamination, or to any act or condition incident to any of the foregoing. H. For injury to, or sickness, disease, or death of any person; for injury to or destruction of any tangible property, including the loss of use thereof. CIC 747 (1/95) Page 3 of 6

4 I. Under Coverage 1A, if judgment adverse to the Corporation s, Trust s or Association s Directors, Officers, Trustees or Managing Board shall establish that their acts of active and deliberate dishonesty or actual intent to deceive or defraud on their part was material to the cause of action so adjudicated. J. Under Coverage 1B, if judgment adverse to the insured, in suit brought against such insured, shall establish that acts of active and deliberate dishonesty or actual intent to deceive or defraud on the part of such insured was material to the cause of action so adjudicated. K. Under Coverage 1B for any loss for which the insured shall be indemnified by the Corporation, Trust, or Association, pursuant to the operation of law, or as otherwise authorized by the by-laws, or articles of incorporation of the Corporation, Trust or Association, which determine and define such rights of indemnity. L. Arising out of or in any way connected with racial or religious discrimination. CONDITIONS 1. LOSS UNDER THIS ENDORSEMENT SHALL MEAN: Under Insuring Agreement 1A - Indemnities due the Directors, Officers, or Trustees or Managing Board on account of actions, claims, proceedings and appeals therefrom relating to the alleged negligent acts, errors or omissions of Directors, Officers, Trustees or Managing Board, whether such indemnities are pursuant to the operation of law or as otherwise authorized by the by-laws or articles of incorporation of the Corporation, Trust or Association, which determine and define such right of indemnity. Under Insuring Agreement 1B - Settlements and judgments resulting from actions, claims or proceedings and appeals therefrom made against the insureds for negligent acts, errors or omissions, while acting in their capacities as Officers, Directors, Trustees or Managing Board. 2. LIMITS OF LIABILITY: A. The limit of liability herinabove stated as applicable to each occurrence is the limit of the Company s liability for all loss incurred on account of any claim covered hereunder. B. The limit of liability hereinabove stated as aggregate is, subject to the above provision respecting each occurrence, the total limit of the Company s liability for all loss covered hereunder and arising out of negligent acts, errors or omissions during the period this endorsement remains in effect. C. All losses arising out of the same act or acts of the Directors, Officers, Trustees or Managing Board shall be considered as arising out of one occurrence. D. The inclusion in this endorsement of more than one insured shall not operate to increase the limits of the Company s liability. CIC 747 (1/95) Page 4 of 6

5 E. The Company s maximum liability with respect to Coverages 1A and 1B combined shall not exceed the limits hereinabove stated. F. The Company shall be liable to pay not more than 95% of loss excess of a retained limit of $ up to the limits of liability stated in this endorsement, it being warranted that the remaining 5% of each and every loss shall be carried by the insured(s) at their own risk and uninsured. This endorsement shall pay only the excess of the retained limit with respect to each and every loss hereunder and such retention is to be borne by the insured(s) and is not to be insured. 3. CONCEALMENT OR MISREPRESENTATION: This entire endorsement shall be void if the insured has concealed or misrepresented any material fact of or circumstances concerning this insurance or the subject thereof or in the case of any fraud or false swearing by the insured touching any matter relating to this insurance or the subject thereof whether before or after loss. 4. INSURED S DUTIES IN THE EVENT OF OCCURRENCE, CLAIM OR SUIT: A. In the event of an occurrence which may involve the coverage of this endorsement, written notice containing reasonable obtainable information with respect to such occurrence shall be given by or for the insured to the Company or any of its authorized agents as soon as practicable. B. If claim is made or suit is brought against the insured, the insured shall immediately forward to the Company every demand, notice, summons or other process received by him or his representative for handling and processing by the Company exclusively. C. The insured shall cooperate with the Company, and upon the Company s request, assist in making settlements, in the conduct of suits and in enforcing any right of contribution or indemnity against any person or organization who may be liable to the insured because of an occurrence with respect to which insurance is afforded under this endorsement, and the insured shall attend hearings and trials and assist in securing and giving evidence and obtaining the attendance of witnesses. The insured shall not, except at his own cost, voluntarily make any payment, assume any obligation or incur any expense. 5. APPEALS: The Company may elect to take an appeal at its own cost and expense, and shall be liable for the taxable costs and disbursements and interest incidental thereto, but in no event shall the liability of the Company exceed the limits herein above stated and, in addition thereto, the cost and expense of such appeal for any one claim. 6. LOSS PAYABLE: Recovery under this contract in respect to claim or loss arising out of any occurrences covered hereunder, shall not be made unless and until the insured s liability has either been rendered fixed and certain by final judgment or admitted by the Company in writing. CIC 747 (1/95) Page 5 of 6

6 7. ACTION AGAINST COMPANY: No action shall lie against the Company, unless as a condition precedent thereto, the insured shall have fully complied with all terms of this contract. In the event of the bankruptcy or insolvency of the insured, the Company shall not be relieved of the payment of such indemnity hereunder as would have been payable for such bankruptcy or insolvency. 8. OTHER INSURANCE: This endorsement does not cover any loss which, at the time of happening of such loss, is insured by any other existing valid policy or policies under which payment of the loss was actually made, except in respect of any excess beyond the amount of such payment under any such other policy or policies. However, if the insured has other insurance with respect to negligent acts, errors or omissions which occur prior to the effective date of this endorsement, coverage under this endorsement shall not apply. 9. SUBROGATION: In the event of any payment under this endorsement, the Company shall be subrogated, to the extent of such payment, to all the insured s rights of recovery therefor, and the insured shall execute all papers required and shall do everything that may be necessary to secure such rights. 10. CHANGES: Notice to any agent or knowledge possessed by any agent or by any other person shall not effect a waiver or a change in any part of this endorsement or stop the Company from asserting any right under the terms of this endorsement, nor shall the terms of this endorsement be waived or changed, except by further endorsement issued to form a part hereof. Except as specifically modified by this endorsement, all of the terms and conditions of the policy, of which this endorsement forms a part, remain without change. ATTACHED TO AND FORMING PART OF POLICY NO. OF THE DATED, 19. (Name of Insurance Company) AGENT: CIC 747 (1/95) Page 6 of 6