SHAREHOLDERS AGREEMENT
SHAREHOLDERS AGREEMENT (this "Agreement") dated as of December 19, 1999, by
and among Trenwick Group Inc., a Delaware corporation ("Trenwick"), and the
other parties signatory hereto (each, a "Shareholder" and together, the
"Shareholders").
RECITALS
WHEREAS, simultaneously herewith Trenwick is entering into an
Agreement, Scheme of Arrangement, Plan of Merger and Plan of
Reorganization, dated as of December 19, 1999, by and among LaSalle Re
Holdings, a company organized under the laws of Bermuda ("LaSalle
Holdings"), LaSalle Re Limited, a company organized under the laws of
Bermuda ("LaSalle Re"), Trenwick, Xxxxx Holdings International Limited, a
company organized under the laws of Bermuda ("New Holdings") and Trenwick
Group (Delaware) Inc., a Delaware corporation (the "Business Combination
Agreement");
WHEREAS, the Business Combination Agreement provides that Trenwick
and LaSalle Holdings will be entering into a series of transactions
pursuant to which (i) New Holdings will become the holding company of such
companies and (ii) shareholders of LaSalle Holdings and LaSalle Re and
stockholders of Trenwick will become shareholders of New Holdings as set
forth in such agreement;
WHEREAS, each Shareholder owns that number of (i) LaSalle
Holdings' common shares, par value $1.00 per share (the "Common Shares"),
and (ii) LaSalle Re's exchangeable non-voting shares (the "Non-Voting
Shares" and, together with the Common Shares, the "Shares", which term
shall include Shares which are acquired or may be acquired upon the
exercise of any and all options to acquire Common Shares and Non-Voting
Shares ("Options"), whether such Options exist on the date hereof or
otherwise) set forth next to such Shareholder's name on Exhibit A hereto;
and
WHEREAS, as a condition to its willingness to enter into the
Business Combination Agreement, Trenwick has required that each Shareholder
agree, and each Shareholder has agreed, among other things, to execute and
deliver this Agreement with respect to the Shares owned (whether by
conversion or otherwise) by such Shareholder, on the terms and conditions
provided for herein.
NOW, THEREFORE, in consideration of the foregoing and the mutual
representations, warranties, covenants and agreements herein contained, the
parties hereto agree as follows:
1. Voting Agreement. At any meeting of the shareholders of
LaSalle Holdings or LaSalle Re called to vote upon the Scheme of Arrangement
or the Business Combination Agreement or at any adjournment thereof or in
any other circumstances upon which a vote, consent or other approval of
shareholders of LaSalle Holdings or LaSalle Re with respect to any of the
other matters referred to below is sought, each Shareholder hereby agrees
to vote (or cause to be voted) the Shares held of record or beneficially
by such Shareholder as of the applicable record date (i) in favor of the
Scheme of Arrangement, the execution and delivery by LaSalle Holdings and
LaSalle Re of the Business Combination Agreement and the approval of the
terms thereof and each of the other actions contemplated by the Business
Combination Agreement, this Agreement and any actions required in
furtherance hereof and thereof; (ii) against any action or agreement that
would, to its knowledge, result in a breach of any covenant, representation
or warranty or any other obligation or agreement of LaSalle Holdings or
LaSalle Re under the Business Combination Agreement or this Agreement;
and (iii) against the following actions (other than the Scheme and the
transactions contemplated by the Business Combination Agreement): (1) any
extraordinary corporate transaction, such as a merger, consolidation,
amalgamation or other business combination involving LaSalle Holdings or any of
its subsidiaries (including, without limitation, LaSalle Re); (2) a sale, lease
or transfer of a material amount of assets of LaSalle Holdings or any of its
subsidiaries(including, without limitation, LaSalle Re) or a
reorganization, recapitalization, dissolution or liquidation of LaSalle
Holdings or any of its subsidiaries (including, without limitation, LaSalle
Re); (3) (a) any change in the majority of the Board of Directors of
LaSalle Holdings or LaSalle Re; (b) any material change in the present
capitalization of LaSalle Holdings or LaSalle Re or any material amendment
of LaSalle Holdings' or LaSalle Re's Memorandum of Association and
Bye-laws; (c) any other material change in LaSalle Holdings' or LaSalle
Re's corporate structure or business; or (d) any other action which is
intended, or could reasonably be expected, to impede, interfere with,
delay, postpone, discourage or materially adversely affect the Scheme of
Arrangement or the transactions contemplated by the Business Combination
Agreement or this Agreement or the contemplated economic benefits of any of
the foregoing. Each Shareholder hereby revokes any proxy previously granted
by it with respect to the Shares. Each Shareholder hereby agrees, while
this Agreement is in effect, and except as contemplated hereby, not to take
any action that would make any representation or warranty of such
Shareholder contained herein untrue or incorrect or have the effect of
preventing or disabling such Shareholder from performing his or its
obligations under this Agreement; provided, however, that nothing in this
Agreement shall be deemed to prohibit or restrict in any manner any
Shareholder from selling, transferring, or otherwise disposing of any
Shares or Options to any person. The provisions of this Section 1 shall
terminate and no longer bind the Shareholders at such time as the LaSalle
Holdings Board of Directors either (A) withdraws or modifies its approval
and recommendation of the Business Combination Agreement pursuant to clause
(x) of the second sentence of Section 5.3(b)(ii) thereof or (B) terminates
the Business Combination Agreement pursuant to clause (y) of the second
sentence of Section 5.3(b)(ii) thereof.
2. Representations and Warranties of Trenwick. Trenwick hereby
represents and warrants to each Shareholder that the execution and delivery
of this Agreement and the
consummation of the transactions contemplated hereby have been duly and
validly authorized by the Board of Directors of Trenwick and no other
corporate proceedings on the part of Trenwick are necessary to authorize
this Agreement or to consummate the transactions contemplated hereby. This
Agreement has been duly and validly executed and delivered by Trenwick and
constitutes a valid and binding agreement of Trenwick, enforceable against
Trenwick in accordance with its terms, except that such enforceability (i)
may be limited by bankruptcy, insolvency, moratorium or other similar laws
affecting or relating to enforcement of creditors' rights generally and
(ii) is subject to general principles of equity.
3. Representations and Warranties of the Shareholders. Each
Shareholder hereby represents and warrants, severally and not jointly, to
Trenwick as follows:
(a) Ownership of Shares and Options. Such Shareholder, as
of the date hereof, (i) is the owner of the number of
Shares and Options set forth next to such Shareholder's
name on Exhibit A hereto and (ii) has the sole power to
vote (or to give any consent that may be required in
respect of such Shares and Options) and dispose of such
Shares and Options.
(b) Power; Binding Agreement. Such Shareholder has the
legal capacity, power and authority to enter into and
perform all of its obligations under this Agreement. The
execution, delivery and performance of this Agreement by
such Shareholder will not violate any other agreement to
which such Shareholder is a party including, without
limitation, any voting agreement, shareholders agreement
or voting trust. This Agreement has been duly and validly
authorized, executed and delivered by such Shareholder
and constitutes a valid and binding agreement of such
Shareholder, enforceable against such Shareholder in
accordance with its terms, except that such
enforceability (i) may be limited by bankruptcy,
insolvency, moratorium or other similar laws affecting or
relating to enforcement of creditors' rights generally
and (ii) is subject to general principles of equity.
(c) No Conflicts. (A) No filing by such Shareholder with,
and no permit, authorization, consent or approval of, any
state, federal or foreign public body or authority is
necessary for the execution of this Agreement by such
Shareholder and the consummation by such Shareholder of
the transactions contemplated hereby and (B) neither the
execution and delivery of this Agreement by such
Shareholder nor the consummation by such Shareholder of
the transactions contemplated hereby nor compliance by
such Shareholder with any of the provisions hereof shall
(1) conflict with or result in any breach of any
provision of the certificate of incorporation, by-laws,
trust or charitable instruments (or similar documents) of
such Shareholder, (2) result in a
violation or breach of, or constitute (with or without
notice or lapse of time or both) a default (or give rise
to any third party right of termination, cancellation,
material modification or acceleration) under any of the
terms, conditions or provisions of any note, bond,
mortgage, indenture, license, contract, agreement or
other instrument or obligation to which such Shareholder
is a party or by which he or it or any of his or its
properties or assets may be bound or (3) violate any
order, writ, injunction, decree, statute, rule or
regulation applicable to such Shareholder or any of his
or its properties or assets, except in the case of (A) or
(B) for violations, breaches or defaults which would not
in the aggregate materially adversely affect the ability
of such Shareholder to perform its obligations hereunder.
4. Adjustments to Prevent Dilution, Etc. In the event of a stock
dividend or distribution, or any change in LaSalle Holdings' or LaSalle
Re's capital shares by reason of any share dividend, split-up,
reclassification, recapitalization, combination or the exchange of shares,
the term "Shares" shall be deemed to refer to and include the Shares as
well as all such stock dividends and distributions and any shares into
which or for which any or all of the Shares may be changed or exchanged.
5. Miscellaneous.
(a) Entire Agreement. This Agreement contains the entire
understanding of the parties with respect to the subject
matter hereof and may not be amended except by a writing
signed by the parties. Except as specifically provided
herein, this Agreement is not assignable by any of the
parties, provided that none of the transactions described
in Sections 2.1(b) and 2.1(c) of the Business Combination
Agreement shall be considered an assignment by Trenwick.
This Agreement shall be binding upon the respective
successors of the parties and upon transferees of the
Shares who are Affiliates of the transferring
Shareholder.
(b) Notices. All notices, requests, claims, demands and
other communications hereunder shall be in writing and
shall be given (and shall be deemed to have been duly
received if so given) by hand delivery, telegram, telex
or telecopy, or by mail (registered or certified mail,
postage prepaid, return receipt requested) or by any
courier service, such as Federal Express, providing proof
of delivery. All communications hereunder shall be
delivered to the respective parties at the following
addresses:
If to a Shareholder, to the address of such Shareholder
indicated on Exhibit A hereto.
If to Trenwick:
Trenwick Group Inc.
Xxx Xxxxxxxxxx Xxxxx
Xxxxxxxx, Xxxxxxxxxxx 00000
Attention: Xxxxx Xxxxxxxxx and
Xxxx Del Col, Esq.
Facsimile No.: (000) 000-0000
with a copy to:
Xxxxx & XxXxxxxx
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx X. Xxxxxxx, Esq.
Facsimile No.: (000) 000-0000
If to New Holdings:
Xxxxx Holdings International Limited
c/x Xxxxxxx Xxxxxxxx & Xxxxx
Xxxxx Xxxxx
00 Xxxxx Xxxxxx
P.O. Box Hm 1179
Xxxxxxxx Bermuda HMEX
Attention: Xxxxxx Xxxxxx
Facsimile No: (000) 000-0000
With a copy to:
Xxxxx & XxXxxxxx
000 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx X. Xxxxxxx, Esq.
Facsimile No.: (000) 000-0000
or to such other address as the person to whom notice is given may have
previously furnished
to the others in writing in the manner set forth above.
(c) Notification by Shareholder. Each Shareholder shall
notify Trenwick from time to time, upon request, of the
number of Shares beneficially owned by such Shareholder.
(d) Governing Law. This Agreement shall be governed in
all respects by the laws of the State of Delaware without
regard to any laws or regulations relating to choice of
laws (whether of the State of Delaware or any other
jurisdiction) that would cause the application of the
laws of any jurisdiction other than the State of
Delaware.
(e) Cooperation. Subject to the terms and conditions of
this Agreement, each of the parties hereby agrees to use
its best efforts to take, or cause to be taken, all
action and to do, or cause to be done, all things
necessary, proper or advisable under applicable laws,
rules and regulations to consummate and make effective
the actions contemplated by this Agreement. In case at
any time after the execution of this Agreement, further
action is necessary or desirable to carry out the
purposes of this Agreement, the proper officers and
directors of each of the parties shall take all such
necessary or desirable action.
(f) Specific Performance. Each of the parties hereto
recognizes and acknowledges that a breach by it of any
covenants or agreements contained in this Agreement will
cause the other party to sustain damages for which it
would not have an adequate remedy at law for money
damages, and therefore, each of the parties hereto agrees
that in the event of any such breach the aggrieved party
shall be entitled to the remedy of specific performance
of such covenants and agreements and injunctive and other
equitable relief in addition to any other remedy to which
it may be entitled, at law or in equity.
(g) Counterparts. This Agreement may be executed in one
or more counterparts, each of which shall be deemed to be
an original, but all of which shall constitute one and
the same Agreement.
(h) Definitions. Capitalized terms used but not defined
herein shall have the meanings set forth in the Business
Combination Agreement.
(i) Descriptive Headings. The descriptive headings used
herein are inserted for convenience of reference only and
are not intended to be part of or to affect the meaning
or interpretation of this Agreement.
(j) Severability. Whenever possible, each provision or
portion of any
provision of this Agreement will be interpreted in such
manner as to be effective and valid under applicable law
but if any provision or portion of any provision of this
Agreement is held to be invalid, illegal or unenforceable
in any respect under any applicable law or rule in any
jurisdiction, such invalidity, illegality or
unenforceability will not affect any other provision or
portion of any provision in such jurisdiction, and this
Agreement will be reformed, construed and enforced in
such jurisdiction as if such invalid, illegal or
unenforceable provision or portion of any provision had
never been contained herein.
(k) Termination. Unless earlier terminated as provided
herein, this Agreement shall terminate, without further
liability or obligation of the parties hereto, including
liability for damages, upon the earlier of (i) the 180th
calendar day following the termination of the Business
Combination Agreement in accordance with its terms and
(ii) consummation of the Scheme of Arrangement.
IN WITNESS WHEREOF, this Agreement has been executed by or on
behalf of each of the parties hereto, all as of the date first above
written.
TRENWICK GROUP INC.
By: /s/ Xxxxx X. Xxxxxxx, Xx.
--------------------------------
Name: Xxxxx X. Xxxxxxx, Xx.
Title: Chairman, President and CEO
SHAREHOLDERS:
COMBINED INSURANCE COMPANY OF
AMERICA
By: /s/ Xxxxxxx X. Xxxxxx
--------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Senior Vice President
VIRGINIA SURETY COMPANY, INC.
By: /s/ Xxxxxxx X. Xxxxxx
--------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Vice President
AON RISK CONSULTANTS (BERMUDA) LTD.
By: /s/ Xxxxxxx X. Xxxxxx
--------------------------------
Name: Xxxxxxx X. Xxxxxx
Title: Authorized Agent
CONTINENTAL CASUALTY COMPANY
By: /s/ Xxxxxx X. Deutsch
-------------------------------
Name: Xxxxxx X. Deutsch
Title: Senior Vice President and CFO
CNA (BERMUDA) SERVICES LIMITED
By: /s/ Xxxxxx X. Deutsch
-------------------------------
Name: Xxxxxx X. Deutsch
Title: Authorized Agent
EXHIBIT A
NUMBER OF NUMBER OF
COMMON SHARES EXCHANGEABLE NON- OPTIONS
SHAREHOLDER NAME OF LASALLE VOTING SHARES OF AND/OR
AND ADDRESS HOLDINGS LASALLE RE WARRANTS
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Combined Insurance 322,715 1,221,750 0
Company of America
Virginia Surety Company, 322,715 1,221,750 0
Inc.
Aon Risk Consultants 555,244 0 0
(Bermuda), Ltd.
Continental Casualty 1,425,354 1,963,896 0
Company
CNA (Bermuda) Services 0 318,150 0
Limited
