Annual Report — Form 10-K
Filing Table of Contents
Document/Exhibit Description Pages Size
1: 10-K Platinum Underwriters Holdings, Ltd. 138 768K
2: EX-2.1 Formation and Separation Agreement 301 1.41M
3: EX-3.2 Restated Bye-Laws 54 170K
4: EX-4.1 Form of Certificate of Common Shares 2 20K
5: EX-4.2 Indenture 75 361K
6: EX-4.3 Indenture Supplement 20 83K
7: EX-4.4 Purchase Contract Agreement 125 487K
8: EX-4.5 Pledge Agreement 43 179K
9: EX-4.6 Form of Senior Note 13 58K
10: EX-4.7 Form of Guarantee 3 25K
11: EX-4.8 Form of Normal Unit 17 74K
12: EX-4.9 Form of Stripped Unit 16 65K
13: EX-10.1 Share Unit Plan for Non-Employee Directors 6 34K
16: EX-10.15 Letter Agreement 3 26K
17: EX-10.16 364-Day Credit Agreement 53 237K
18: EX-10.17 Letter Amendment #1 to 364-Day Credit Agreement 3 25K
19: EX-10.18 Letter Amendment #2 to 364-Day Credit Agreement 5 28K
20: EX-10.19 Capital Support Agreement 10 45K
14: EX-10.2 2002 Share Incentive Plan 13 67K
21: EX-10.20 Capital Support Agreement 4 25K
22: EX-10.21 Registration Rights Agreement 17 89K
23: EX-10.22 Option Agreement 14 70K
24: EX-10.23 Option Agreement 15 72K
25: EX-10.24 Option Agreement 14 71K
26: EX-10.25 Employee Benefits & Compensation Matters Agreement 29 79K
27: EX-10.26 Master Services Agreement 13 57K
28: EX-10.27 U.K. Master Services Agreement 18 64K
29: EX-10.28 Runoff Services Agreement 23 125K
30: EX-10.29 U.K. Runoff Services Agreement 18 65K
15: EX-10.3 Capital Accumulation Plan 11 57K
31: EX-10.30 Underwriting Management Agreement 9 31K
32: EX-10.31 U.K. Underwriting Agency & Management Agreement 21 62K
33: EX-10.32 U.K. Business Transfer Agreement 59 163K
34: EX-10.33 Intra-Group Asset Transfer Agreement 6 24K
35: EX-10.34 Transitional Trademark License Agreement 10 42K
36: EX-10.35 Investment Agreement 325 1.50M
37: EX-10.36 1st Amendment to Investment Agreement 4 27K
38: EX-10.37 Transfer Restrictions Reg. Righst & Standstill Agr 23 109K
39: EX-10.38 Option Agreement 14 69K
40: EX-10.39 Services & Capacity Reservation Agreement 8 40K
41: EX-10.40 100% Quota Share Retrocession Agreement 110 618K
42: EX-10.41 100% Quota Share Retrocession Agreement 41 149K
43: EX-10.42 100% Quota Share Retrocession Agreement 44 157K
44: EX-10.43 100% Quota Share Retrocession Agreement 42 151K
45: EX-10.44 100% Quota Share Retrocession Agreement 42 154K
46: EX-10.45 100% Quota Share Retrocession Agreement 42 153K
47: EX-10.46 100% Quota Share Retrocession Agreement 36 131K
48: EX-10.47 100% Quota Share Retrocession Agreement 41 152K
49: EX-10.48 100% Quota Share Retrocession Agreement 43 171K
50: EX-10.49 100% Quota Share Retrocession Agreement 41 153K
51: EX-10.50 100% Quota Share Retrocession Agreement 41 153K
52: EX-10.51 100% Quota Share Retrocession Agreement 43 157K
53: EX-10.52 Uk 100% Quota Share Retrocession Agreement 85 397K
54: EX-10.53 Uk 100% Quota Share Retrocession Agreement 42 156K
55: EX-10.54 Uk 100% Quota Share Retrocession Agreement 42 159K
56: EX-10.55 100% Quota Share Retrocession Agreement 114 387K
57: EX-10.56 Security Agreement 20 79K
58: EX-10.57 Control Agreement 31 111K
59: EX-10.58 Discretionary Investment Advisory Agreement 14 57K
60: EX-10.59 Revised & Amended Trust Agreement 28 79K
61: EX-10.60 Discretionary Investment Advisory Agreement 18 76K
62: EX-10.61 Revised and Amended Trust Agreement 26 73K
63: EX-10.62 Discretionary Investment Advisory Agreement 18 77K
64: EX-10.63 Letter Amend. to Revised & Amended Trust Agreement 2 22K
65: EX-10.64 Quota Share Retrocession Agreement 100 331K
66: EX-10.65 Security Agreement 22 86K
67: EX-10.66 Control Agreement 34 125K
68: EX-10.67 Discretionary Investment Advisory Agreement 15 61K
69: EX-99.1 Certification of CEO 1 17K
70: EX-99.2 Certification of CFO 1 18K
EX-10.37 — Transfer Restrictions Reg. Righst & Standstill Agr
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EXHIBIT 10.37
[Letterhead of Platinum Underwriters Holdings, Ltd.]
November 1, 2002
RenaissanceRe Holdings Ltd
Renaissance House
8-12 East Broadway
Pembroke HM 19
Bermuda
TRANSFER RESTRICTIONS, REGISTRATION RIGHTS
AND STANDSTILL AGREEMENT
Ladies and Gentlemen:
Pursuant to an Investment Agreement, dated September 20, 2002, among
Platinum Underwriters Holdings, Ltd, a Bermuda company (the "Company"), The St.
Paul Companies, Inc. ("St. Paul") and the Purchaser identified therein
("Purchaser") (the "Investment Agreement"), the Company has agreed to sell to
Purchaser or its permitted assignees, and Purchaser has agreed to purchase from
the Company, (i) 3,960,000 Common Shares, par value $0.01 per share, of the
Company and, in certain circumstances described in the Investment Agreement, has
the right to purchase up to an additional 594,000 Common Shares (collectively,
the "Shares") and (ii) an option (the "RenRe Option") to purchase up to
2,500,000 additional Common Shares pursuant to the RenRe Option Agreement
attached as Exhibit B to the Investment Agreement.
Unless the context otherwise requires, each reference herein to the
Securities Act, the Exchange Act or Rule 144 (or any other rule, regulation or
form promulgated under either such statute) shall be deemed to mean, as of any
time, such statute, rule, regulation or form as then in effect, after all
amendments thereto, or, if not then in effect, any successor statute, rule,
regulation or form as then in effect, after all amendments thereto.
The Company and Purchaser are entering into this Agreement to define the
future relationship between the Company and Purchaser and in consideration of
the mutual covenants and agreements contained herein.
1. Certain Definitions. As used in this Agreement, the following capitalized
terms have the respective meanings set forth below:
"Affiliate" means, with respect to one person, any other person that
directly or indirectly through one or more intermediaries controls or is
controlled by or is under common control with such person.
"Beneficial owner" and "beneficially own" means, with respect to any
person
(i) securities that such person or any of such person's Affiliates,
directly or indirectly, has the right to vote or dispose of or has
"beneficial ownership" of (as determined pursuant to Rule 13d-3 of the
General Rules and Regulations under the Exchange Act, including without
limitation pursuant to any agreement, arrangement or understanding,
whether or not in writing; provided that a person shall not be deemed the
"beneficial owner" of, or to "beneficially own," (A) securities tendered
pursuant to a tender or exchange offer made by such person or any of such
person's Affiliates until such tendered securities are accepted for
payment, purchase or exchange, (B) any security as a result of an oral or
written agreement, arrangement or understanding to vote such security if
such agreement, arrangement or understanding: (1) arises solely from a
revocable proxy given in response to a public proxy or consent
solicitation made pursuant to, and in accordance with, the applicable
provisions of the General Rules and Regulations under the Exchange Act,
and (2) is not also then reportable by such Person on Schedule 13D under
the Exchange Act (or any comparable or successor report); or
(ii) securities that are beneficially owned, directly or indirectly, by
any other person (or any Affiliate thereof) with which such person (or any
of such person's Affiliates) has any agreement, arrangement or
understanding (whether or not in writing, but excluding customary
agreements with and between underwriters and selling group members with
respect to a bona fide public offering of securities until the expiration
of forty days after the date of such acquisition), for the purpose of
acquiring, holding, voting (except pursuant to a revocable proxy as
described in the proviso to subparagraph (i) above) or disposing of any
Voting Securities.
"Common Shares" means the common shares, par value U.S. $0.01 per share,
of the Company.
"Exchange Act" means the U.S. Securities Exchange Act of 1934, as amended.
"Purchaser Group" means RenRe and its Subsidiaries at such time.
"Registrable Shares" means, at any time, any and all Common Shares owned
by the Purchaser Group, whether issued to RenRe pursuant to the Investment
Agreement or the RenRe Option or otherwise acquired, as the case may be, other
than shares that have ceased to be Registrable Shares. Common Shares cease to be
Registrable Shares (a) when a registration statement with respect to the
disposition of such shares has become effective under the Securities Act and
such shares shall have been disposed of pursuant to such registration statement,
or (b) when such shares have been sold pursuant to Rule 144 under the Securities
Act.
"Registration Expenses" means any and all expenses incident to performance
of or compliance with the demand rights set forth in Section 3(a) and piggy-back
rights set forth in Section 3(b), including, (a) all SEC and stock exchange or
National Association of Securities Dealers, Inc. registration and filing fees,
(b) all fees and expenses of complying with state securities or blue sky laws
(including reasonable fees and disbursements of counsel for the underwriters in
connection with blue sky qualifications of the Registrable Shares), (c) the cost
of printing or preparing any registration statement, prospectus, offering
circular, agreement among underwriters, underwriting agreement, blue sky
memorandum, share certificates and any other
2
documents in connection with the offering, purchase, sale and delivery of the
Registrable Shares, (d) the costs and charges of any transfer agent and
registrar and any custodian or attorney-in-fact appointed to act on behalf of
Purchaser, (e) all messenger and delivery expenses of the Company, (f) the
reasonable fees and expenses of any qualified independent underwriter, (g) the
reasonable fees and disbursements of counsel for the Company and the Company's
independent public accountants, including the expenses of any special audits
and/or "cold comfort" letters required by or incident to such performance and
compliance and (h) any road show and marketing expenses; provided that Purchaser
shall pay the fees and disbursements of its own counsel, if any, and all
underwriting discounts, commissions and transfer taxes, if any, relating to the
sale or disposition of its Registrable Shares.
"Securities Act" means the U.S. Securities Act of 1933, as amended.
"Subsidiary" means, as to any person, (i) any corporation 50% of whose
stock of any class or classes having by the terms thereof ordinary voting power
to elect a majority of the directors of such corporation (irrespective of
whether or not at the time stock of any class or classes of such corporation
shall have or might have voting power by reason of the happening of any
contingency) is at the time owned by such person and/or one or more Subsidiaries
of such person and (ii) any other person in which such person and/or one or more
Subsidiaries of such person has a 50% equity interest at the time.
"Voting Securities" means securities of the Company with the power to vote
with respect to the election of directors generally, including, without
limitation, Common Shares (or, where reference is made to the "voting securities
of another corporation," such term shall mean securities that are generally
entitled to vote in the election of directors of such other corporation).
"Wholly Owned Subsidiary" means, as to any person, (i) any corporation
100% of whose stock of any class or classes having by the terms thereof ordinary
voting power to elect a majority of the directors of such corporation
(irrespective of whether or not at the time stock of any class or classes of
such corporation shall have or might have voting power by reason of the
happening of any contingency) is at the time owned by such person and/or one or
more Wholly Owned Subsidiaries of such person and (ii) any other person in which
such person and/or one or more Wholly Owned Subsidiaries of such person has a
100% equity interest at the time.
2. Restrictions on Transfers.
(a) Purchaser agrees that, prior to the first anniversary of the Closing
(as defined in the Investment Agreement), it will not, directly or indirectly,
sell, transfer or otherwise dispose of any of the Shares or any interest
therein, except that Purchaser may transfer Shares under the following
circumstances:
(i) to any Wholly Owned Subsidiary of Purchaser that enters into a
standstill agreement with the Company containing terms and conditions
substantially identical to those in this Agreement, provided that any such
transferee shall not, at the time of the transfer or at any time
thereafter, be other than a Foreign Corporation (as such term is defined
in the Investment Agreement) and a Qualified Institutional Buyer (as such
term is defined in
3
Rule 144A under the Securities Act), and in any case in accordance with
all applicable law;
(ii) pursuant to any tender offer or exchange offer which is recommended
by the Board of Directors of the Company; or
(iii) in a transfer by operation of law upon consummation of a merger or
consolidation of Purchaser into another person.
(b) Notwithstanding anything to the contrary in this Agreement, Purchaser
may not, at any time, directly or indirectly, sell, transfer or otherwise
dispose of more than 9.9% of the Common Shares outstanding at the time of such
sale, transfer or other disposition to any person that generates 50% or more of
its gross revenue in its most recent fiscal year for which financial statements
are available, by writing property or casualty insurance or reinsurance, except
in the following circumstances: (i) in connection with any tender offer or
exchange offer made to all holders of outstanding Common Shares; (ii) to a
Wholly Owned Subsidiary of Purchaser provided that such Wholly Owned Subsidiary
agrees in writing with the Company to the same transfer restrictions as are
contained in this Section 2; or (iii) in a transfer by operation of law upon
consummation of a merger or consolidation of Purchaser into another person.
(c) For the avoidance of doubt, no transfer of Shares, RenRe Option Shares
or the RenRe Option or any interest therein pursuant to this Section 2 or
pursuant to the Option Agreement shall result in any increase in the number of
Demand Requests (as defined below) available.
3. Registration Rights.
(a) Demand Rights.
(i) From and after the first anniversary of the Closing (unless the
Company consents to an earlier date, such consent not be unreasonably
withheld), Purchaser has the right, on four occasions, to require the
Company to file a registration statement on Form S-1, S-2 or S-3 (or Form
F-1, F-2 or F-3) or any similar or successor to such Forms under the
Securities Act for a public offering Registrable Shares, by delivering to
the Company written notice, with a copy to St. Paul, stating that such
right is being exercised, naming, if applicable, the members of the
Purchaser Group whose Registrable Shares are to be included in such
registration (collectively, the "Demanding Shareholders"), specifying the
number of each such Demanding Shareholder's Registrable Shares to be
included in such registration and describing the intended method of
distribution thereof (a "Demand Request"); provided that, from and after
the fifth anniversary of the Closing, Purchaser has the right to two
additional Demand Requests if on such date Purchaser is the beneficial
owner (directly or indirectly) of more than 9.9% of the Common Shares then
outstanding. Upon receipt of a Demand Request, the Company shall use its
reasonable best efforts to promptly effect the registration under the
Securities Act of the Registrable Shares included in the Demand Request to
permit the Demanding Shareholders to sell or otherwise dispose of its
Registrable Shares included in the registration in accordance with the
method or methods of distribution intended by the Demanding Shareholders.
The
4
rights and obligations of the parties listed under this Section 3(a)(i)
are subject to the other provisions of this Agreement.
(ii) The Company's obligations pursuant to Section 3(a)(i) above are
subject to the following conditions:
(A) the Company is not obligated to fulfill a Demand Request
if it has fulfilled a Demand Request received during the period of
12 months immediately preceding the date of receipt of such Demand
Request;
(B) the Company is not obligated to fulfill a Demand Request
unless the Demand Request is for such number of Registrable Shares
with a market value that is equal to at least $50 million as of the
date of such Demand Request, provided that the last Demand Request
(as specified in Section 3(a)(i) of this Agreement) will not be
subject to the limitations of this Section 3(a)(ii)(B);
(C) the Company shall, if requested by Purchaser, undertake a
"road show" and other customary marketing efforts in connection with
the sale of Registrable Shares pursuant to such registration, at
such times and in such manner as Purchaser may reasonably request;
(D) the Company is not obligated to fulfill the requirements
herein with regard to any registration relating to a Demand Request:
(1) during any period of time (not to exceed ninety (90)
days in the aggregate during any period of twelve (12)
consecutive months) after the Company has determined to
proceed with a Securities Act registration of any of its
securities and is diligently proceeding to complete such
registration or any offering of securities pursuant thereto
(whether for its own account or that of any shareholder but
excluding any registration on Form S-8 under the Securities
Act or any similar or successor form) if, in the judgment of a
nationally recognized investment banking firm (which may be
acting as managing underwriter for any such offering or as
financial advisor to the Company), the fulfillment of such
requirements or such filing would have an adverse effect on
the offering,
(2) during any period of time (not to exceed ninety (90)
days during any period of twelve (12) consecutive months) when
the Company is in possession of material, non-public
information that the Company would not be required to disclose
publicly in the absence of any Securities Act registration of
its securities, and the disclosure of which would be
materially injurious to the Company, or
(3) during any period of time (not to exceed ninety (90)
days during any period of twelve (12) consecutive months) when
the Company is engaged in, or has determined to engage in and
is proceeding diligently with, any program for the purchase
of, or any tender offer or exchange offer for, its capital
securities, and determines, on advice of nationally
5
recognized independent U.S. counsel knowledgeable in such
matters, that such program or offer and the requested
registration may not proceed concurrently without violating
Regulation M under the Exchange Act;
(E) the Company is not required to maintain the effectiveness
of a registration statement filed pursuant to Section 3(a)(i) for a
period in excess of 90 consecutive days, which period shall be
tolled during any period in which the Company invokes its rights
under Section 3(1); provided, however, that, from and after the
third anniversary of the Closing and receipt thereafter by the
Company of written instructions from Purchaser to such effect, in
the case of any registration of Registrable Shares on Form S-3 or
F-3 which are intended to be offered on a continuous or delayed
basis, such 90-day period shall be extended until all such
Registrable Securities are sold, provided that Rule 415, or any
successor rule under the Securities Act, permits an offering on a
continuous or delayed basis, provided further that applicable rules
under the Securities Act governing the obligation to file a
post-effective amendment permit, in lieu of filing a post-effective
amendment which (1) includes any prospectus required by Section
10(a) of the Securities Act or (2) reflects facts or events
representing a material or fundamental change in the information set
forth in the registration statement, the incorporation by reference
of information required to be included in (1) and (2) above to be
contained in periodic reports filed pursuant to Section 12 or 15(d)
of the Exchange Act in the registration statement and provided
further that Purchaser shall give the Company written notice, with a
copy to St. Paul, at least ten business days prior to the beginning
of any fiscal quarter in which Purchaser intends to attempt to sell,
transfer or otherwise distribute any Common Shares pursuant to this
subsection (E) which are offered on a continuous or delayed basis,
which notice shall specify the aggregate number of Common Shares
Purchaser intends to attempt to sell, transfer or dispose of in such
fiscal quarter:
(F) and shall not be required to file or maintain any
registration statement that permits a delayed or continuous offering
to be made for more than 30 consecutive days, which period shall be
tolled during any period in which the Company invokes its rights
under Section 3(f), after such registration statement becomes
effective;
(G) any underwriting agreement entered into in connection with
any public offering pursuant to this Section 3 shall contain a
provision pursuant to which the managing underwriter of any such
public offering shall agree to use its reasonable best efforts to
avoid selling Registrable Shares to any one person or group of
related persons (other than another dealer acting as an underwriter
or member of any selling group in connection with such public
offering) if, as a result of such sale, any person would
beneficially or of record own directly or indirectly through a
foreign corporation, or constructively under applicable rules
contained in the Internal Revenue Code of 1986, as amended (the
"Code"), more than 9.9% of the Voting Securities; and
6
(H) Purchaser is entitled to designate any one or more lawful
methods of distribution permitted pursuant to the registration
statement (including a firm commitment underwriting) to be the
method of distribution for the registration pursuant to this Section
3(a), and Purchaser will sell its Registrable Shares included in the
registration in the designated methods (and, in the case of any
underwriting, on the same terms and conditions as the Company and
any other selling shareholder); the intended methods of distribution
shall be indicated in the Demand Request and shall be finally
determined prior to filing the registration statement. In any
distribution pursuant to a Demand Request involving an underwriter,
Purchaser is entitled to select any nationally recognized investment
banking firm to act as underwriter, provided that with respect to
any Demand Requests and piggy-back registrations for which the
Company bears the costs and expenses pursuant to Section 3(g), such
selection of an underwriter by Purchaser is subject to the consent
of the Company, such consent not to be unreasonably withheld.
(iii) Subject to Section 3(c), the Company may elect to include in
any registration statement filed pursuant to this Section 3(a) any Common
Shares to be issued by it or held by any of its Subsidiaries or by any
other shareholders only to the extent such shares are offered and sold
pursuant to, and on the terms and subject to the conditions of, any
underwriting agreement or distribution arrangements entered into or
effected by the Demanding Shareholders.
(iv) Purchaser may withdraw a Demand Request at any time. A Demand
Request withdrawn pursuant to this Section 3(a)(iv) is deemed not to have
been made for purposes of Section 3(a) and is of no further effect if and
only if Purchaser pays or reimburses the Company for all expenses and
costs incurred by the Company in connection with such Demand Request.
(b) "Piggy-Back" Rights. If at any time after the Closing the Company
proposes to register, for its own account or for the account of any shareholder,
any Common Shares on a registration statement on Form S-1, S-2 or S-3 (or Form
F-1, F-2 or F-3) or any similar or successor to such Forms under the Securities
Act for purposes of a public offering of such Common Shares, other than pursuant
to a Demand Request, Purchaser has the right to include any Registrable Shares
in such registration. The Company shall give prompt written notice of any such
proposal, including the intended method of distribution of such Common Shares,
to Purchaser. Subject to Section 3(c), upon the written request (a "Piggy-Back
Request") of Purchaser, given within fifteen (15) business days after the
transmittal of any such written notice, the Company will use its reasonable best
efforts to include in such public offering any or all of the Registrable Shares
then held by Purchaser or, if applicable, the Purchaser Group, to permit the
sale of such Registrable Shares pursuant to the intended method or methods of
distribution; provided that any participation in such public offering by
Purchaser must be on substantially the same terms as the Company's and each
other shareholder's participation therein; and provided further, that the total
number of Common Shares to be included in any such public offering may not
exceed the Maximum Number (as defined below), and Common Shares must be
allocated to give effect to this proviso as provided in Section 3(c). Purchaser
has the right to withdraw a Piggy-Back Request by giving written notice to the
Company of its election to withdraw such
7
request at least five (5) business days prior to the proposed filing date of
such registration statement. Each Piggy-Back Request by Purchaser must specify
the members of the Purchaser Group whose Registrable Shares are to be included
in the registration and the number of shares for each such member. The Company
is entitled to select any nationally recognized investment banking firm as
underwriter in a registration pursuant to this Section 3(b).
(c) Allocation of Securities Included in a Public Offering. If the
managing underwriter or placement agent for any public offering effected
pursuant to Section 3(a) or Section 3(b) (or, if there is none, a nationally
recognized investment banking firm acting as financial advisor to the Company)
advises the Company and Purchaser in writing that the number of Common Shares
sought to be included in such public offering (including those sought to be
offered by the Company and those sought to be offered by St. Paul and Purchaser)
exceeds the maximum number of Common Shares whose inclusion in such public
offering would not be reasonably likely to have an adverse effect on the price,
timing or distribution of the Common Shares included in such public offering
(the "Maximum Number"), the Company shall allocate Common Shares to be included
in such public offering up to the Maximum Number as follows:
(i) in the case of any registration pursuant to Section 3(a), first
to the Demanding Shareholders, subject, if applicable, to allocation below
the Maximum Number in such manner as they may agree among themselves;
then, as to any excess, to the Company; and
(ii) in the case of any registration pursuant to Section 3(b), first
to the Company for its own account; then to Purchaser and each other
shareholder designated by the Company, subject to allocation below the
Maximum Number pro rata according to the number of Registrable Shares held
by the Purchaser Group or by such other shareholder, as the case may be.
Purchaser may allocate any allocation made to it pursuant to this Section 3(c)
among the members of the Purchaser Group as it wishes. The Company may allocate
any allocation made to it pursuant to Section 3(c)(i) among itself, its
Subsidiaries and its shareholders as it wishes, and may allocate any allocation
made to it for its own account pursuant to Section 3(c)(ii) among itself and its
Subsidiaries as it wishes.
(d) Indemnification.
(i) The Company shall indemnify, to the extent permitted by law, and
hold harmless Purchaser and each member of the Purchaser Group and each
underwriter against any losses, claims, damages or liabilities, joint or
several, or actions in respect thereof ("Claims"), to which such
indemnified party may become subject, under the Securities Act or
otherwise, insofar as such Claims arise out of or are based upon any
untrue statement or alleged untrue statement of any material fact
contained in the registration statement, in any prospectus or preliminary
prospectus included in such registration statement or in any amendment or
supplement thereto filed with the SEC (collectively, "Registration
Documents") or insofar as such Claims arise out of or are based upon the
omission or alleged omission to state in any Registration Document a
material fact required to be stated therein or necessary to make the
statements made
8
therein not misleading, and will reimburse any such indemnified party for any
legal or other expenses reasonably incurred by such indemnified party in
investigating or defending any such Claim as such expenses are incurred;
provided that the Company is not liable in any such case to the extent that any
such Claim arises out of or is based upon an untrue statement or alleged untrue
statement or omission or alleged omission made in any Registration Document in
reliance upon and in conformity with written information furnished to the
Company by or on behalf of such indemnified party specifically for use in the
preparation of such Registration Document.
(ii) In connection with any registration in which Purchaser is
participating, Purchaser shall indemnify, to the extent permitted by law,
and hold harmless the Company and each underwriter against any Claims to
which each such indemnified party may become subject under the Securities
Act or otherwise, insofar as such Claims arise out of or are based upon
any untrue statement or alleged untrue statement of any material fact
contained in any Registration Document, or insofar as any claims arise out
of or are based upon the omission or alleged omission to state in any
Registration Document a material fact required to be stated therein or
necessary to make the statements made therein not misleading; provided,
however, that such indemnification is payable only if, and to the extent
that, any such Claim arises out of or is based upon an untrue statement or
alleged untrue statement or omission or alleged omission made in any
Registration Document in reliance upon and in conformity with written
information furnished to the Company by or on behalf of Purchaser or any
member of the Purchaser Group specifically for use in the preparation of
such Registration Document.
(iii) Any person entitled to indemnification under Section 3(d)(i)
or (ii) above shall notify promptly the indemnifying party in writing of
the commencement of any Claim if a claim for indemnification in respect
thereof is to be made against an indemnifying party under this Section
3(d), but the omission of such notice shall not relieve the indemnifying
party from any liability which it may have to any indemnified party
otherwise than under Section 3(d)(i) or (ii). In case any action is
brought against an indemnified party and it shall notify the indemnifying
party of the commencement thereof, the indemnifying party is entitled to
participate in, and, to the extent that it chooses, to assume the defense
thereof with counsel reasonably acceptable to the indemnified party, who
may be counsel for the indemnifying party unless the indemnified party
reasonably concludes such counsel would have a conflict of interest in
representing both indemnified and indemnifying parties (provided, that the
Company is not responsible for the fees and expenses of more than one
counsel for all indemnified parties with respect to any Claim or group of
Claims alleged to have arisen from similar facts); and, after notice from
the indemnifying party to the indemnified party that it so chooses, the
indemnifying party is not liable for any legal or other expenses
subsequently incurred by the indemnified party in connection with the
defense thereof other than reasonable costs of investigation. The
indemnifying party is not liable for any settlement of any proceeding
effected without its written consent, but if settled with such consent or
if there be a final judgment for the plaintiff, the indemnifying party
agrees to indemnify the indemnified party from and against any loss or
liability by reason of such settlement or judgment. No indemnifying party
may, without the prior written consent of the indemnified party, effect
any settlement of any pending or threatened proceeding in
9
respect of which any indemnified party is or could have been a party and
indemnity could have been sought hereunder by such indemnified party, unless
such settlement includes an unconditional release of such indemnified party from
all liability on claims that are the subject matter of such proceeding.
(iv) If for any reason the foregoing indemnity is unavailable to, or is
insufficient to hold harmless, an indemnified party in respect of any
Claim, (a) if the indemnified party is an underwriter, then each
indemnifying party shall contribute to the amount paid or payable by the
indemnified party as a result of any Claim in such proportion as is
appropriate to reflect the relative benefits received by Purchaser and the
Company, on the one hand, and the indemnified party, on the other, from
the offering of securities to which such Registration Documents relate,
(b) as between the Company and Purchaser, the indemnifying party shall
contribute to the amount paid or payable by the indemnified party as a
result of any Claim in such proportion as is appropriate to reflect the
relative benefits to and the relative fault of the indemnifying party, on
the one hand, and the indemnified party, on the other, in connection with
the statements or omissions that resulted in such Claims, as well as any
other relevant equitable considerations. If, however, the allocation
provided in clause (a) or (b) of the immediately preceding sentence is not
permitted by applicable law, or if the indemnified party failed to give
the notice required by clause (iii) above, then each indemnifying party
shall contribute to the amount paid or payable by such indemnified party
in such proportion as is appropriate to reflect both the relative benefits
and the relative fault of the indemnifying party and the indemnified party
in connection with the statements or omissions that resulted in such
Claims as well as any other relevant equitable considerations. The
relative benefits received by Purchaser and the Company, on the one hand,
and by the underwriters, on the other, shall be deemed to be in the same
proportion as the total net proceeds from the offering of the securities
(before deducting expenses) received by Purchaser and the Company, on the
one hand, bear to the total underwriting discounts and commissions
received by the underwriters, on the other hand, in connection with such
offering. The relative fault shall be determined by reference to, among
other things, whether the untrue or alleged untrue statement of a material
fact or the omission or alleged omission to state a material fact relates
to information supplied by the indemnifying party or by the indemnified
party and the parties' relative intent, knowledge, access to information
and opportunity to correct or prevent such statement or omission. The
amount paid or payable in respect of any Claim shall be deemed to include
any legal or other expenses reasonably incurred by such indemnified party
in connection with investigating or defending any such Claim. No person
guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the Securities Act) is entitled to contribution from any
person who was not guilty of such fraudulent misrepresentation.
(v) As a condition to their obligations under this Section 3(d),
each of the Company and Purchaser must have received from each underwriter
of Registrable Shares included in a registration statement filed under the
Securities Act pursuant to Section 3(a) or 3(b) an undertaking to
indemnify, to the extent permitted by law, and hold harmless the Company
and Purchaser against (or if such indemnity is unavailable or is
insufficient to hold harmless an indemnified party, to provide
contribution, on substantially the same basis provided to such underwriter
in accordance with Section 3(d)(iv), in respect of) any
10
Claims to which each such indemnified party may become subject under the
Securities Act or otherwise, insofar as such Claims arise out of or are
based upon any untrue statement or alleged untrue statement of any
material fact contained in any Registration Document, or insofar as any
claims arise out of or are based upon the omission or alleged omission to
state in any Registration Document a material fact required to be stated
therein or necessary to make the statements made therein not misleading;
provided, however, that such indemnification (or contribution, as the case
may be) shall be payable only if, and to the extent that, any such Claim
arises out of or is based upon an untrue statement or alleged untrue
statement or omission or alleged omission made in any Registration
Document in reliance upon and in conformity with written information
furnished to the Company by or on behalf of such underwriter specifically
for use in the preparation thereof. Notwithstanding the foregoing, no
underwriter shall be required to contribute any amount in excess of the
amount by which the total price at which the Registrable Shares
underwritten by it and distributed to the public were offered to the
public exceeds the amount of any damages which such underwriter otherwise
has been required to pay by reason of such untrue or alleged untrue
statement or omission or alleged omission. The obligation of any
underwriters to provide indemnification (or contribution, as the case may
be) pursuant to this paragraph (v) shall be several in proportion to their
respective underwriting commitments and not joint.
(vi) The maximum liability of Purchaser to indemnify or contribute
payments pursuant to this Section 3(d) may not exceed the aggregate net
proceeds from the sale of Common Shares (including the sale of Common
Shares, if any, pursuant to the exercise of an over-allotment option) to
Purchaser in such registration.
(vii) The obligations of the Company pursuant to this Section 3(d)
are in addition to any liability which the Company may otherwise have and
extends, upon the same terms and conditions, to each officer, director and
general partner of any underwriter or Purchaser and to each person, if
any, who controls any underwriter or Purchaser within the meaning of the
Securities Act. The obligations of Purchaser pursuant to this Section 3(d)
are in addition to any liability which Purchaser may otherwise have and
extends, upon the same terms and conditions, to each officer, director and
general partner of the Company, any underwriter and to each person, if
any, who controls the Company or any underwriter within the meaning of the
Securities Act. The obligations of any underwriter pursuant to this
Section 3(d) are in addition to any liability which such underwriter may
otherwise have and extends, upon the same terms and conditions, to each
officer, director and general partner of the Company or Purchaser and to
each person, if any, who controls the Company or Purchaser within the
meaning of the Securities Act.
(viii) The indemnification provisions set forth in this section are
the sole and exclusive remedy of the parties hereto for any and all claims
for indemnification under this Agreement.
(e) Requirements with Respect to Registration. If and whenever the Company
is required by the provisions hereof to use its reasonable best efforts to
register any Registrable Shares under the Securities Act, the Company shall, as
promptly as practicable:
11
(i) Prepare and file with the SEC a registration statement with
respect to such Registrable Shares and use its reasonable best efforts to
cause such registration statement to become and remain effective for the
periods specified herein.
(ii) Prepare and file with the SEC such amendments and supplements
to such registration statement and the prospectus used in connection
therewith as may be necessary to keep such registration statement current
and to comply with the provisions of the Securities Act and any
regulations promulgated thereunder with respect to the sale or other
disposition of such Registrable Shares, for as long as a prospectus
relating to any such Registrable Shares is required to be delivered under
the Securities Act, subject to the limitation in Section 3(a)(ii)(F).
(iii) Furnish to each member of the Purchaser Group participating in
the offering copies (in reasonable quantities) of summary, preliminary,
final, amended or supplemented prospectuses, in conformity with the
requirements of the Securities Act and any regulations promulgated
thereunder, and other documents as reasonably may be required in order to
facilitate the disposition of such Registrable Shares, but only while the
Company is required under the provisions hereof to keep the registration
statement current.
(iv) Use its reasonable best efforts to register or qualify the
Registrable Shares covered by such registration statement under such other
securities or blue sky laws of such jurisdictions in the United States as
the managing underwriter or placement agent (or, if none, Purchaser) shall
reasonably request, and do any and all other acts and things which may be
reasonably necessary to enable such managing underwriter, placement agent
or Purchaser to consummate the disposition of the Registrable Shares in
such jurisdictions; provided, however, that in no event is the Company
required to qualify to do business as a foreign corporation in any
jurisdiction where it is not so qualified; to execute or file any general
consent to service of process under the laws of any jurisdiction; to take
any action that would subject it to service of process in suits other than
those arising out of the offer and sale of the securities covered by the
registration statement; or to subject itself to taxation in any
jurisdiction where it has not theretofore done so unless the Company shall
have received a reasonably satisfactory indemnity in respect thereto; or
to subject itself to any insurance regulation in any jurisdiction in which
it has not theretofore been so subject.
(v) Notify Purchaser, at any time when a prospectus relating to any
Registrable Shares covered by such registration statement is required to
be delivered under the Securities Act, of the Company's becoming aware
that the prospectus included in such registration statement, as then in
effect, includes an untrue statement of a material fact or omits to state
any material fact required to be stated therein or necessary to make the
statements therein not misleading in the light of the circumstances then
existing, and, subject to the limitation in Section 3(a)(ii), promptly
prepare and furnish to Purchaser and each underwriter a reasonable number
of copies of a prospectus supplemented or amended so that, as thereafter
delivered to the purchasers of the Registrable Shares, such prospectus
shall not include an untrue statement of a material fact or omit to state
a
12
material fact required to be stated therein or necessary to make the
statements therein not misleading in the light of the circumstances then
existing.
(vi) As soon as practicable after the effective date of such
registration statement, and in any event within eighteen (18) months
thereafter, make generally available to Purchaser an earnings statement
(which need not be audited) covering a period of at least twelve (12)
consecutive months beginning after the effective date of the registration
statement, which earning statement shall satisfy the provisions of Section
11(a) of the Securities Act, including at the Company's option, Rule 158
thereunder.
(vii) Deliver promptly to Purchaser, upon Purchaser's written
request, copies of all correspondence between the SEC and the Company, its
counsel or auditors and all memoranda relating to discussions with the SEC
or its staff with respect to the registration statement and permit
Purchaser to do such investigation, upon reasonable advance notice, with
respect to information contained in or omitted from the registration
statement as it deems reasonably necessary. Purchaser agrees that it will
use its reasonable best efforts not to interfere unreasonably with the
Company's business when conducting any such investigation. Purchaser shall
not, and shall not permit any member (other than a member controlling
Purchaser) of the Purchaser Group and shall use its reasonable best
efforts to cause any member of the Purchaser Group controlling Purchaser
and any underwriter in connection with such offering not to, disclose any
material non-public information received from the Company pursuant to this
Section 3(e)(vii) unless such material non-public information becomes
generally known on a non-confidential basis other than as a result of the
breach of any obligation of confidentiality.
(viii) The Company agrees that it will use its reasonable best
efforts to obtain "cold comfort" letters from the Company's independent
public accountants (including one letter when such registration statement
goes effective and one at the closing) in customary form and covering such
matters of the type customarily covered by such "cold comfort" letters.
(ix) Enter into underwriting or placement agreements in the
customary form, including, without limitation, representations and
warranties and indemnification and contribution provisions for any
underwriter or placement agent selling Registrable Shares hereunder.
(x) Use its commercially reasonable efforts to qualify (and remain
qualified) for registration on Form S-3 or F-3, as applicable.
(f) Use of Registration Statement. Purchaser shall, and shall cause each
other member (other than a member controlling Purchaser) of the Purchaser Group
and shall use its reasonable best efforts to cause each member of the Purchaser
Group controlling Purchaser and each underwriter in connection with any public
offering to, upon receipt by Purchaser of the Company's notice pursuant to
Section 3(e)(v), promptly discontinue the disposition of Registrable Shares
pursuant to the prospectus and registration statement contemplated by such
notice, until such time as Purchaser and the underwriters have received copies
of the amended or supplemented prospectus contemplated by Section 3(e)(v) and
upon such receipt by Purchaser,
13
Purchaser shall, and shall use its reasonable best efforts to cause each
underwriter in connection with any public offering to, deliver to the Company
all copies in the possession of Purchaser or any such underwriter at the time of
receipt by Purchaser of the Company's notice pursuant to Section 3(e)(v) of any
prospectus covering Registrable Shares.
(g) Expenses.
(i) The Company shall pay (to the extent permitted by the Bermuda
Companies Act 1981 as then in effect) the Registration Expenses (other
than underwriting discounts and commissions, which shall be borne by
Purchaser) incurred in connection with the first two Demand Requests, and
Purchaser shall pay the Registration Expenses (including the underwriting
discounts and commissions) incurred in connection with all other Demand
Requests, provided that in each case, each of the Company and Purchaser
shall pay the expenses of its own legal counsel and provided further, that
to the extent the Company files a registration statement in response to a
Demand Request made prior to the first anniversary of the Closing,
Purchaser will pay the Registration Expenses (including the underwriting
discounts and commissions) and such Demand Request shall not be considered
one of the first two Demand Requests for purposes of this Section 3(g)(i).
(ii) With respect to the Registration Expenses (other than
underwriting discounts and commissions, which shall be borne by Purchaser)
incurred in connection with any piggy-back registration under Section
3(b), Purchaser shall only pay such portion of such expenses that is equal
to the fraction, (A) the numerator of which is the number of Registrable
Shares registered (subject to any cutback) pursuant to the applicable
Piggy-Back Request of Purchaser, and (B) the denominator of which is the
total number of Common Shares registered under the applicable registration
statement.
(h) Certain Obligations of Purchaser. Purchaser shall provide such
information to the Company as the Company may reasonably request in connection
with any registration hereunder of Registrable Shares for Purchaser's account
and shall dispose of any such Registrable Shares pursuant to any registration
hereunder in the manner contemplated thereby, and shall notify the Company in
writing if it becomes aware of any material change or inaccuracy in such
information.
(i) Transfer of RenRe Option. In the event Purchaser transfers the RenRe
Option to one or more transferees pursuant to Section 6(c) of the RenRe Option
Agreement, following execution by any such transferee and delivery to the
Company of an instrument reasonably acceptable to the Company acknowledging that
such transferee has become a party to this Agreement and assumed Purchaser's
rights and obligations hereunder, all references herein to Purchaser with
respect to Registrable Shares consisting of Common Shares issuable pursuant to
the RenRe Option Agreement shall be deemed to apply (i) in the case of a
transfer of the RenRe Option in whole, solely to the transferee of the RenRe
Option and (ii) in the case of a transfer of the RenRe Option in part,
collectively either to the transferees of the RenRe Option or, if Purchaser has
retained a portion of the RenRe Option, to Purchaser and such transferee(s). The
Company shall be entitled to rely solely upon the instructions of Purchaser or
the transferee of the RenRe Option designated in writing by RenRe with respect
to any rights granted hereunder
14
to the holders of Registrable Option Shares. The number of demand and piggy back
registration rights afforded Purchaser hereunder shall apply in aggregate to
Purchaser and any and all said transferees, without any increase in the number
of said demand and piggy back registration rights. There are no registration
rights with respect to the RenRe Option itself.
(j) Lock-up Arrangements. Purchaser agrees that, upon the request of the
Company, it shall agree to any lock-up arrangement requested by any underwriter
for up to a 90 day period following the effectiveness of any Securities Act
registration statement covering the Company's capital securities (but excluding
any registration on Form S-8 under the Securities Act or any similar successor
form), provided, that if such registration statement relates to a public
offering of Common Shares, other than pursuant to a Demand Request, Purchaser
has the right to submit a Piggy-Back Request to the Company pursuant to Section
3(b) without regard to the notice requirement in such section.
(k) Availability of Rule 144. The Company shall use its reasonable best
efforts to ensure that the information requirement set forth in paragraph (c) of
Rule 144 is satisfied so that the safe harbor provided by Rule 144 is available
to Purchaser for all transfers of Registrable Shares made after the 90th day
after the Company becomes subject to the reporting requirements of Section 13 of
the Exchange Act. Upon request made by Purchaser at any time during such period,
the Company will provide Purchaser with a written statement confirming that the
Company has been subject to and has complied with the reporting requirements as
provided in said paragraph (c), unless the Company has included such a statement
in its then-latest annual or quarterly report filed with the SEC.
(1) Termination of Certain Rights. The rights of Purchaser to make a
Piggy-Back Request pursuant to Section 3(b) shall terminate on the first day
after the Closing on which Purchaser does not have a right to make a Demand
Request pursuant to Section 3(a) (the "Termination Date"); provided that, as to
any Registrable Shares that are subject to a Demand Request or Piggy-Back
Request duly delivered on or prior to the Termination Date, such termination
will be delayed until such shares have been disposed of pursuant to such
registration statement or such offering has been completed or abandoned.
4. Standstill and Voting Provisions; Share Repurchases.
(a) Purchaser agrees that except as contemplated in the Investment
Agreement, Purchaser and its Subsidiaries will not, and Purchaser will use its
commercially reasonable efforts to cause its Affiliates and any officer,
employee, agent or representative of Purchaser or such Affiliates (collectively,
the "Representatives") to not, directly or indirectly, (i) advise or encourage
any party or entity with respect to the voting of any Voting Securities in an
attempt to cause a Change in Control of the Company, (ii) initiate or otherwise
solicit shareholders of the Company for the granting of any proxy or the
approval of one or more shareholder proposals, or induce any other party or
entity to seek any proxy or to initiate any shareholder proposal, that in any
case results or is designed to result in a Change in Control of the Company, or
(iii) directly or indirectly acquire, announce an intention to acquire, or agree
to acquire, by purchase or otherwise, beneficial ownership of any Voting
Securities, if, immediately after any such acquisition, Purchaser or any
Subsidiary of Purchaser would beneficially or of record own, in the aggregate,
more than 19.9% of the Voting Securities then outstanding, except with the prior
15
written approval of the Company, provided, that nothing herein shall limit the
ability of Purchaser or any of its Affiliates to discuss any matter, including a
Change in Control of the Company, with St. Paul or any of its Affiliates. A
"Change in Control" of the Company is deemed to have occurred if (i) any person
or group (as defined for purposes of Section 13 of the Securities Exchange Act
of 1934, as amended) (excluding the Company or any Subsidiary thereof) becomes
the beneficial owner of more than 50% of the outstanding equity securities of
the Company representing the right to vote for the election of directors or (ii)
there shall occur a merger, consolidation or other business combination in which
the Company is acquired (unless the shareholders of the Company immediately
before such business combination own, directly or indirectly, immediately
following such business combination, at least a majority of the combined voting
power of the entity resulting from such business combination).
(b) In the event that the Company determines to effect repurchases of its
Common Shares (and, if applicable, New Securities, as defined below) in a
repurchase program approved by its board of directors, then Purchaser must sell
to the Company, on each day on which any Common Shares are so repurchased at a
price equal to the average price of repurchases by the Company on such day, such
number of Common Shares necessary to limit Purchaser's beneficial ownership
interest in the Company to no more than 19.9% of the outstanding Voting
Securities (on an Unadjusted Basis (as defined in the Company's bye-laws)) after
all such repurchases, or such higher limit as the Company may approve in
writing; provided, that Purchaser may require that any repurchases from it by
the Company must be at the average purchase price of any repurchases effected by
the Company on such day pursuant to Rule l0b-18 under the Exchange Act. The
precise number of Common Shares to be repurchased by the Company from Purchaser
will be rounded up to the nearest round lot number.
(c) Notwithstanding anything in Section 4(b) to the contrary, if (i)
Purchaser beneficially owns less than 19.9% of the outstanding Voting Securities
on an Unadjusted Basis (as defined in the Company's bye-laws) or such higher
limit as the Company may approve in writing other than as a result of any
voluntary sale of Common Shares by Purchaser, and (ii) Purchaser thereafter
purchases Common Shares to maintain such beneficial ownership level at 19.9% or
such higher limit as the Company may approve in writing either (A) in accordance
with its pre-emptive rights under Section 5 or (B) in the open market, in each
case within 60 days after suffering such dilution, then any repurchases by the
Company of its Common Shares in the period that is six months plus one day from
the trade date of any such purchase by Purchaser in accordance with clause (A)
or (B) may only be effected in a manner that either does not trigger Purchaser's
obligation pursuant to Section 4(b) to sell back Common Shares to the Company,
or would not result in any requirement by Purchaser to disgorge profits pursuant
to Section 16(b) of the Exchange Act.
(d) Purchaser shall use its commercially reasonable efforts to cause all
Voting Securities beneficially owned directly or indirectly by it or any
Subsidiary to be present for quorum purposes, in person or represented by proxy
at every meeting of holders of Common Shares (or, if applicable, in any matter
to be acted upon by written consent of shareholders without a meeting).
16
5. Pre-emptive Rights.
(a) If the Company proposes to issue (a "Dilutive Transaction") any Common
Shares or any securities convertible into or exchangeable for or carrying in any
way the right to acquire Common Shares (the "New Securities"), Purchaser will
have the right to subscribe for up to such number of New Securities as is
necessary to maintain Purchaser's beneficial ownership interest in the Company
at the same percentage owned immediately prior to the Dilutive Transaction
(assuming conversion or exchange of the New Securities; provided, however, that
Purchaser shall not have a right to subscribe for any New Securities if the
ownership of such New Securities would cause Purchaser to beneficially own in
excess of 19.9% of the outstanding Voting Securities, or such higher limit as
the Company may approve in writing. The precise number of New Securities to be
issued to Purchaser will be rounded up to the nearest round lot number. For the
avoidance of doubt, the issuance of Common Shares upon the settlement of the
Purchase Contracts forming part of the ESUs is deemed to be a Dilutive
Transaction.
(b) If the Company proposes to issue New Securities, it shall give
Purchaser 30 days' written notice of its intention, describing the type and
number of New Securities and the price and terms upon which the Company proposes
to issue the same. Purchaser shall have ten days from the date of receipt of any
such notice to agree to purchase up to Purchaser's pro rata share of New
Securities specified above for the same price paid to the Company in connection
with such Dilutive Transaction (i.e., less underwriting discounts and
commissions) by giving written notice to the Company and stating therein the
quantity of New Securities to be purchased provided, however, that in the
connection with an Early Settlement (as such term is defined in the Purchase
Contract Agreement) of the Purchase Contracts pursuant to Section 5.10 of the
Purchase Contract Agreement, this Section 5(b) shall not apply, but the Company
shall give the Purchaser prompt written notice of such Early Settlement.
(c) In the event that Purchaser fails to exercise its pre-emptive right
within the ten-day notice period, the Company shall have 120 days thereafter to
sell the New Securities with respect to which Purchaser's pre-emptive right was
not exercised, upon the same terms specified in the Company's notice to
Purchaser (except that underwriting discounts and commissions may be paid),
provided that the Company shall not be obligated to issue such New Securities.
To the extent the Company does not sell all the New Securities offered within
such 120-day period, the Company shall not thereafter issue or sell such New
Securities without first again offering such securities to Purchaser in the
manner provided above.
(d) Notwithstanding anything in this Section 5 to the contrary, the
parties hereby agree that
(i) any New Securities issued pursuant to (A) any director or
employee benefit plans of the Company or (B) any acquisition transaction
engaged in by the Company are not to be deemed Dilutive Transactions and
that, consequently, no preemptive rights will attach with respect to New
Securities issued pursuant to clauses (A) and (B);
17
(ii) Purchaser's pre-emptive rights to subscribe for New Securities
will terminate without any further action by either party hereto at such
time as Purchaser beneficially owns less than 6.25% of the outstanding
Common Shares;
(iii) Purchaser shall have no pre-emptive rights with respect to any
proposed Dilutive Transaction if (A) to the extent a proposed Dilutive
Transaction is an underwritten public offering, the underwriters request a
reduction of the number of New Securities to be issued, or (B) prior to a
Dilutive Transaction a nationally recognized investment bank mutually
agreed by the parties advises Purchaser and the Company in writing that
Purchaser exercising pre-emptive rights in connection with such Dilutive
Transaction would materially hinder or interfere with such proposed
Dilutive Transaction;
(iv) with respect to any New Securities that are securities
convertible into or exchangeable for or carrying in any way the right to
acquire Common Shares ("Convertible New Securities"), the terms of such
Convertible New Securities issuable to Purchaser upon exercise of the
pre-emptive rights shall contain provisions which preclude conversion into
or exchange for the underlying Common Shares until such time as
Purchaser's ownership of Voting Securities measured immediately after such
conversion or exchange is no more than 19.9% of the total number of
outstanding Voting Securities, or such higher limit as the Company may
approve in writing. Ownership for this purpose will be determined under
Section 958 of the Code. These special limitations on conversions or
exchanges shall lapse upon a transfer of the Convertible New Securities by
Purchaser to a person with which Purchaser has no constructive ownership
relationship under Section 958 of the Code; and
(v) Purchaser shall have no pre-emptive rights in the event of an
issuance of Common Shares upon the conversion or exchange of New
Securities with respect to the issuance of which Purchaser had pre-emptive
rights.
(e) Cooperation.
(i) For so long as Purchaser has the right to exercise any
pre-emptive rights pursuant to this Section 5, each party hereto shall use
its commercially reasonable efforts to obtain all authorizations,
consents, orders and approvals of all governmental authorities and
officials that may be or become necessary in connection with Purchaser's
exercise of such rights, and will cooperate reasonably with the other
party in promptly seeking to obtain all such authorizations, consents,
orders and approvals. The parties hereto agree to cooperate reasonably,
complete and file any joint applications for any authorizations from any
governmental authorities reasonably necessary or desirable to effectuate
the transactions contemplated by this Section 5. The parties hereto agree
that they will keep each other apprised of the status of matters relating
to the exercise of the pre-emptive rights contemplated under this Section
5, including reasonably promptly furnishing the other with copies of
notices or other communications received by the Company or Purchaser, from
all third parties and governmental authorities with respect to the
pre-emptive rights contemplated by this Section 5.
18
(ii) For so long as Purchaser has the right to exercise any
pre-emptive rights pursuant to this Section 5, the Company and Purchaser
agree to reasonably promptly prepare and file, if necessary, any filing
under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as
amended, with the Federal Trade Commission (the "FTC") and the Antitrust
Division of the Department of Justice (the "DOJ") in order to enable
Purchaser to exercise such pre-emptive rights under this Section 5. Each
party hereby covenants to cooperate reasonably with the other such party
to the extent reasonably necessary to assist in making any reasonable
supplemental presentations to the FTC or the DOJ, and, if requested by the
FTC or the DOJ, to reasonably promptly amend or furnish additional
information thereunder.
(iii) Any reasonable out-of-pocket costs and expenses arising in
connection with actions taken pursuant to this Section 5(e) shall be borne
by Purchaser.
6. Specific Performance. Each of Purchaser and the Company acknowledges
that the other party would not have an adequate remedy at law for money damages
if any of the covenants or agreements of the other party in this Agreement were
not performed in accordance with its terms and therefore agrees that the other
party shall be entitled to specific enforcement of such covenants or agreements
and to injunctive and other equitable relief in addition to any other remedy to
which it may be entitled, at law or in equity.
7. Legend. Each of the Company and Purchaser agrees that the certificates
for the Shares and the RenRe Option shall bear the following legend thereon,
which legend shall remain until the date the securities represented by such
certificates are transferred in accordance with the provisions of this
Agreement. In the event of the termination of this Agreement pursuant to Section
13, the second sentence of the legend shall be removed:
THESE SECURITIES WERE SOLD IN A PRIVATE PLACEMENT, AND ANY COMMON SHARES
ISSUED UPON EXERCISE HEREOF WILL BE ISSUED AND SOLD, WITHOUT REGISTRATION
UNDER THE SECURITIES ACT OF 1933, AND MAY BE OFFERED OR SOLD ONLY IF
REGISTERED UNDER THE SECURITIES ACT OF 1933 OR IF AN EXEMPTION FROM
REGISTRATION IS AVAILABLE. THESE SECURITIES ARE SUBJECT TO THE PROVISIONS
OF A TRANSFER RESTRICTIONS, REGISTRATION RIGHTS AND STANDSTILL AGREEMENT
DATED ________, 2002, BY AND BETWEEN THE ISSUER AND THE PURCHASER
IDENTIFIED THEREIN, AND MAY NOT BE SOLD OR TRANSFERRED EXCEPT IN
ACCORDANCE THEREWITH.
8. Entire Agreement. This Agreement, the Investment Agreement, the
Services Agreement, the RenRe Option Agreement and the Confidentiality Agreement
(which Confidentiality Agreement shall terminate as of Closing), contain the
entire understanding of the parties with respect to the subject matter of such
agreements. This Agreement may not be amended or any provision waived except by
a writing signed, in the case of an amendment, by each party hereto and, in the
case of a waiver, by the party against whom the waiver is to be effective. No
failure or delay by any party in exercising any right, power or privilege
hereunder shall operate as a waiver thereof unless the other party is materially
prejudiced thereby, nor shall any single or partial exercise thereof preclude
any other or further exercise thereof or the
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exercise of any other right, power or privilege. The rights and remedies herein
provided shall be cumulative and not exclusive of any rights and remedies
provided by law.
9. Assignment. This Agreement is not assignable by either of the parties
without the prior written consent of the other, except that this Agreement may
be assigned by the Purchaser to (i) any Subsidiary of Purchaser that is a
Foreign Corporation (as defined in the Investment Agreement) and a Qualified
Institutional Buyer (as such term is defined in Rule 144A under the Act),
provided that such assignee enters into an assumption agreement reasonably
satisfactory to the Company, and, provided further that no assignment pursuant
to this clause shall relieve Purchaser of its obligations hereunder, and (ii)
Purchaser may assign in whole or in part its rights and obligations under this
Agreement (excluding Sections 4 and 5 hereof) to any transferee of Registrable
Shares representing more than 4% of the outstanding Common Shares. This
Agreement shall be binding upon and inure to the benefit of the parties hereto
and their respective successors and permitted assigns.
10. Severability. If any term, provision or restriction of this Agreement
is held by a court of competent jurisdiction to be invalid, void or
unenforceable, the remainder of the terms, provisions and restrictions of this
Agreement shall remain in full force and effect, unless such action would
substantially impair the benefits to either party of the remaining provisions of
this Agreement.
11. Notices. Any notices and other communications required to be given
pursuant to this Agreement shall be deemed to have been duly given or made as of
the date delivered or mailed if delivered personally, mailed by registered or
certified mail (postage prepaid, return receipt requested), or delivered by
facsimile or by telex, as follows:
If to the Company:
Platinum Underwriters Holdings, Ltd.
Clarendon House
2 Church Street
Hamilton HM (11)
Bermuda
Attention: General Counsel
Telecopier: (441) 292-4720
with copies to:
Linda E. Ransom
Dewey Ballantine LLP
1301 Avenue of the Americas
New York, New York 10019
Telecopier: (212) 259-6333
20
If to Purchaser:
RenaissanceRe Holdings Ltd.
Renaissance House
8-12 East Broadway
Pembroke HM19 Bermuda
Attention: Stephen H. Weinstein, General Counsel
Telecopier: (441) 296-5037
with copies to:
John S. D'Alimonte
Wilikie Farr & Gallagher
787 Seventh Avenue
New York, New York 10019
Telecopier: (212) 728-8111
12. Effectiveness of Agreement. This Agreement shall become effective only
upon the execution and delivery of this Agreement by the parties hereto and the
occurrence of the Closing under the Investment Agreement.
13. Termination. This Agreement shall terminate upon the occurrence of any
of the following:
(a) the written agreement of the Company and Purchaser to terminate this
Agreement; or
(b) Purchaser shall cease to own Voting Securities.
provided, that the provisions set forth in Section 4(a) hereof will continue in
effect until six months after the termination of this Agreement.
14. Expenses. Except as otherwise provided herein, all costs and expenses
incurred in connection with this Agreement shall be paid by the party incurring
such cost or expense.
15. Governing Law, etc. This Agreement shall be governed by and construed
in accordance with the laws of the State of New York without regard to the
conflicts of laws rules of such State. This Agreement may be executed in one or
more counterparts, which together will constitute a single agreement.
16. Jurisdiction. Except as otherwise expressly provided in this
Agreement, the parties hereto agree that any suit, action or proceeding seeking
to enforce any provision of, or based on any matter arising out of or in
connection with, this Agreement or the transactions contemplated hereby shall be
brought in the United States District Court for the Southern District of New
York or, if such court shall not have jurisdiction over such suit, any New York
State court sitting in New York City, so long as such courts shall have subject
matter jurisdiction over such suit, action or proceeding, and that any cause of
action arising out of this Agreement shall be deemed to have arisen from a
transaction of business in the State of New York, and each of
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the parties hereby irrevocably consents only with respect to such suits, actions
or proceedings to the jurisdiction of such courts (and of the appropriate
appellate courts therefrom) in any such suit, action or proceeding and
irrevocably waives, to the fullest extent permitted by law, any objection that
it may now or hereafter have to the laying of the venue of any such suit, action
or proceeding in any such court or that any such suit, action or proceeding
which is brought in any such court has been brought in an inconvenient forum.
Without limiting the foregoing, each party agrees that service of process on
such party by hand delivery as provided in Section 11 shall be deemed effective
service of process on such party.
17. Waiver of Jury Trial. Each of the parties hereto irrevocably waives
any and all right to trial by jury in any legal proceeding arising out of or
related to this Agreement or the transactions contemplated hereby.
18. Captions. The captions herein are included for convenience of
reference only and shall be ignored in the construction or interpretation
hereof.
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If you are in agreement with the foregoing, please sign the
accompanying copy of this letter and return it to the Company, whereupon this
letter shall be a binding agreement between you and the Company.
Very truly yours,
PLATINUM UNDERWRITERS
HOLDINGS, LTD.
By: /s/ Jerome T. Fadden
----------------------------
Name: Jerome T. Fadden
Title: President & CEO
Accepted and agreed as of the date first written above:
RENAISSANCERE HOLDINGS, LTD.
By: /s/ John M. Lummis
------------------------------
Name: John M. Lummis
Title: Executive Vice President and
Chief Financial Officer
[Signature Page to Transfer Restrictions, Registration Rights
and Standstill Agreement]
Dates Referenced Herein and Documents Incorporated by Reference
| Referenced-On Page |
|---|
| This ‘10-K’ Filing | | Date | | First | | Last | | | Other Filings |
|---|
| |  |
| Filed on: | | 3/31/03 | | | | | | | 10-Q |
| For Period End: | | 12/31/02 |
| | 11/1/02 | | 1 | | | | | 3 |
| | 9/20/02 | | 1 |
| List all Filings |
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