SHARE AND OPTION PURCHASE AGREEMENT
Exhibit 1.01
THIS SHARE AND OPTION PURCHASE AGREEMENT (this “Agreement”) is made and entered into as of
January 23, 2011, by and among Perry Partners International, Inc. and Perry Partners, L.P.
(collectively, the “Sellers”), Perry Corp., Xxxxxxx X. Xxxxx and Endurance Specialty Holdings Ltd.,
an exempted company organized in Bermuda (the “Company”).
WHEREAS, the Sellers desire to sell to the Company, and the Company desires to purchase from
the Sellers, the amount of ordinary shares, par value US$1.00 per share, and the amount of
restricted ordinary shares, par value US$1.00 per share (collectively, the “Shares”), and the
amount of options to acquire ordinary shares, par value US$1.00 per share (the “Options”), set
forth opposite each Seller’s name on Schedule 1 hereto, of the Company, for the amounts set forth
opposite each Seller’s name on Schedule 1 hereto, and subject to the terms, conditions, promises,
representations and warranties set forth herein; and
WHEREAS, the parties hereto desire to set forth herein the terms and conditions of their
agreements and understandings.
NOW, THEREFORE, in consideration of the foregoing, of the mutual promises herein contained and
of other good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, the parties hereto, intending to be legally bound, hereby covenant and agree as
follows:
1. Sale and Transfer of the Shares and Options. The Sellers hereby sell, assign,
transfer, convey and deliver the Shares and Options to the Company. The closing of the purchase
and sale of the Shares and the Options (the “Closing”) shall take place on January 28, 2011 at the
offices of the Company in Bermuda.
2. Instruments of Conveyance and Transfer. At the Closing, the Sellers shall deliver
to the Company either (w) stock certificates endorsed in blank, (x) duly executed assignments
separate from such certificates, (y) evidence that the Sellers have completed electronic delivery
of the Shares through the Depository Trust Company (“DTC”) Deposit/Withdrawal at Custodian (“DWAC”)
system to the account of the Company or (z) the executed option agreements and restricted share
agreements, in each case evidencing the transfer of the Shares and the Options, dated the date of
the Closing, and in such form satisfactory to the Company as shall be effective to vest in the
Company good and valid title to the Shares and the Options, free and clear of any option, call,
contract, commitment, demand, lien, charge, security interest or encumbrance whatsoever. The
Sellers shall at any time, and from time to time, after the Closing, execute, acknowledge and
deliver all further assignments, transfers, and any other such instruments of conveyance, upon the
request of the Company, to confirm the sale of the Shares and Options hereunder.
3. Payment by Buyer. At the Closing, the Company shall purchase (a) the Shares at a
purchase price of US$44.99 per share and (b) the Options at a purchase price of US$44.99 per
share, less the applicable exercise price for such Options, for an aggregate purchase price
for each Seller as set forth in Schedule 1 hereto, by wire transfer of immediately available funds.
4. Representations and Warranties of Seller. As of the date hereof and the date of
the Closing, each Seller, severally and not jointly, represents and warrants that:
(a) The Seller has the full, absolute and entire power and legal right to execute, deliver and
perform this Agreement.
(b) The execution and delivery by the Seller of this Agreement and the consummation of the
transactions contemplated hereby have been duly and validly authorized by all necessary action on
part of the Seller and when duly and validly executed, will constitute a legal, valid and binding
obligation of the Seller enforceable against the Seller in accordance with its terms.
(c) The Shares and Options are owned by the Seller, free and clear of any option, call,
contract, commitment, demand, lien, charge, security interest or encumbrance whatsoever.
5. Representations and Warranties of the Company. As of the date hereof and the date
of the Closing, the Company represents and warrants that:
(a) The Company has the full, absolute and entire power and legal right to execute, deliver
and perform this Agreement.
(b) The execution and delivery by the Company of this Agreement and the consummation of the
transactions contemplated hereby have been duly and validly authorized by all necessary action on
part of the Company and when duly and validly executed, will constitute a legal, valid and binding
obligation of the Company enforceable against the Company in accordance with its terms.
6. Acknowledgments. As of the date hereof and the date of the Closing, each Seller
separately acknowledges that:
(a) The Seller has not relied upon any representations (whether oral or written) with respect
to the Company or the Shares or Options other than as set forth in this Agreement.
(b) The Seller has had an opportunity to discuss the Company’s business, management and
financial affairs with directors, officers and management of the Company. The Seller has also had
the opportunity to ask questions of and receive answers from, the Company and its management
regarding the terms of this transaction. The Seller believes that it has received all the
information it considers necessary or appropriate for deciding whether to sell the Shares and the
Options and has made its own analysis and decision to sell the Shares and the Options to the
Company based upon such information as the Sellers deem appropriate.
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(c) The Seller represents that it (i) is a “qualified institutional buyer” within the meaning
of Rule 144A promulgated under the Securities Act of 1933, as amended (the “Securities Act”), or an
institutional “accredited investor” as that term is defined in Regulation D promulgated under the
Securities Act (“Regulation D”) and has such knowledge, sophistication and experience in financial
and business matters as to be capable of evaluating independently the merits, risks and suitability
of entering into this Agreement and the transactions contemplated hereby, (ii) is able to bear the
risks attendant to the transactions contemplated hereby, and (iii) is dealing with the Company on a
professional arm’s-length basis as defined in Regulation D.
(d) The Seller agrees that it has had a full and complete opportunity to consult legal, tax
and business advisors and has in fact consulted such advisors with respect to this agreement and
any matters contemplated hereunder. The Seller further acknowledges that it has not engaged or
employed any broker or finder in connection with the transactions referred to herein and that the
sale of the Shares and the Options has been privately negotiated by the Seller and the Company.
7. Standstill. Each Seller, Perry Corp. and Xxxxxxx X. Xxxxx (“Xx. Xxxxx”) personally
agree that, for a period of three (3) years from the date of the Closing, unless specifically
invited in writing by the Company, neither the Seller, Perry Corp., Xx. Xxxxx nor any of their
respective affiliates (as such term is defined under the Securities Exchange Act of 1934, as
amended (the “1934 Act”)), or their respective officers, employees, directors or partners, will in
any manner, directly or indirectly, (a) effect or seek, offer or propose (whether publicly or
otherwise) to effect, or cause or participate in or in any way assist any other person to effect or
seek, offer or propose (whether publicly or otherwise) to effect or participate in, (i) any direct
or indirect acquisition of any securities (or beneficial ownership thereof) or assets of the
Company or any of its affiliates, other than the acquisition of up to an aggregate of 2 percent
(2%) of the outstanding common shares of the Company solely for investment purposes; (ii) any
tender or exchange offer, merger or other business combination involving the Company or any of its
affiliates; (iii) any recapitalization, restructuring, liquidation, dissolution or any other
extraordinary transaction with respect to the Company or any of its affiliates; or (iv) any
“solicitation” of “proxies” (as such terms are used in the proxy rules of the Securities and
Exchange Commission) or consents to vote any voting securities of the Company or any of its
affiliates; (b) form, join or in any way participate in a “group” with respect to the Company or
any of its affiliates (as defined under the 1934 Act); (c) take any action that might force the
Company or any of its affiliates to make a public announcement regarding any of the types of
matters set forth in (a) above; or (d) enter into any discussions or arrangements with any person
with respect to any of the foregoing.
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8. Release, Discharge and Waiver. Effective from and after the date of the Closing,
each Seller and Perry Corp., for itself and its officers, directors, respective successors and
assigns, and Xx. Xxxxx personally (collectively, the “Perry Persons”) and the Company, for itself
and its officers, directors, respective successors and assigns (collectively, the “Company
Persons”), hereby irrevocably forever release, discharge and waive any and all claims, rights,
causes of action, suits, obligations, debts, demands, liabilities, controversies, costs, expenses,
fees or damages of any kind, whether directly, derivatively, representatively or in any other
capacity, against, in the case of the Perry Persons, the Company or any of its affiliates and,
in the case of the Company Persons, the Perry Persons and any of their respective affiliates, in
each case including, without limitation, any and all of their respective present and/or past
directors, officers, members, shareholders, employees, fiduciaries or agents, and their respective
successors and assigns, which are based upon, arise from or in any way relate to or involve,
directly or indirectly, the ownership or disposition of the Shares and the Options.
Notwithstanding the foregoing, but subject to Section 6(b) hereof, nothing contained in this
Section 8 shall constitute any release, discharge or waiver to the extent that the applicable
claims, rights, causes of action, suits, obligations, debts, demands, liabilities, controversies,
costs, expenses, fees or damages arise out of (i) this Agreement or (ii) fraud, (iii) the
Indemnification Agreement between Xxxxxxx X. Xxxxx and the Company, dated as of November 20, 2008,
(iv) any directors’ and officers’ insurance policies, or (v) the Memorandum of Association,
Bye-laws, or any other organizational documents or policies of the Company or its subsidiaries.
9. Termination of Amended and Restated Shareholders Agreement and Registration Rights
Agreement. The Sellers, Perry Corp. and Xxxxxxx X. Xxxxx hereby agree that, as of the date of
the Closing, (a) the Amended and Restated Shareholders Agreement, dated as of January 30, 2003, by
and among the Company and each of the Shareholders and Warrant Holders listed on Schedule A thereto
and (b) the Registration Rights Agreement, dated as of July 22, 2002, among the Registrant and each
of the persons listed on Schedule A thereto, terminates and the terms of such Amended and Restated
Shareholders Agreement and Registration Rights Agreement shall be of no further force and effect.
10. Perry Letter. Xx. Xxxxx shall execute and deliver to the Company the letter
attached hereto as Schedule 2 hereto at or before the Closing.
11. Governing Law. This Agreement shall be construed in accordance with the laws of
Bermuda.
12. Invalidity or Unenforceability. In case any one or more of the provisions
contained in this Agreement shall, for any reason, be held to be invalid, illegal or unenforceable
in any respect, such invalidity, illegality or unenforceability shall not affect the other
provisions of this Agreement, and this Agreement shall be construed as if such invalid, illegal or
unenforceable provision had never been contained herein.
13. Benefits and Burdens. This Agreement is binding upon, and inures to the benefit
of, the parties hereto and their respective estates, executors, administrators, legatees, heirs,
and personal and legal representatives, successors and permitted assigns and, in the case of
Section 8, the persons identified therein not party hereto (provided their consent shall not be
required to change or modify such section).
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14. Change; Waiver. No change or modification of this Agreement shall be valid unless
the same is in writing and signed by the parties hereto. No waiver of any provision of this
Agreement shall be valid unless in writing and signed by the party waiving its rights. The failure
of either party at any time to insist upon, or any delay by either party at any time to insist
upon,
strict performance of any condition, promise, agreement or understanding set forth herein
shall not be construed as a waiver or relinquishment of the right to insist upon strict performance
of the same condition, promise, agreement or understanding at a future time.
15. Entire Agreement. This Agreement sets forth all of the promises, agreement,
conditions, understandings and covenants between the parties hereto with respect to the subject
matter referred to herein, and there are no promises other than as set forth herein. Any and all
prior agreements with respect to such subject matter are hereby revoked. This Agreement is, and is
intended by the parties to be, an integration of any and all prior agreements or understandings,
oral or written, with respect to such subject matter.
16. Headings. The headings and other captions in this Agreement are for convenience
and reference only and shall not be used in interpreting, construing or enforcing any of the
provisions of this Agreement.
17. Counterparts. This Agreement may be executed in any number of counterparts, which
may be by facsimile, all of which counterparts taken together shall constitute one and the same
instrument.
[Execution Page Follows]
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the date first above
written.
| COMPANY: ENDURANCE SPECIALTY HOLDINGS LTD. |
||||
| By: | /s/ Xxxxxxx X. XxXxxxx | |||
| Name: | Xxxxxxx X. XxXxxxx | |||
| Title: | Chief Financial Officer | |||
| SELLERS:
PERRY PARTNERS INTERNATIONAL, INC. |
||||
| By: | Perry Corp, its investment manager | |||
| By: | /s/ Xxxxxxx X. Xxxx | |||
| Name: | Xxxxxxx X. Xxxx | |||
| Title: | General Counsel | |||
| PERRY PARTNERS, L.P. |
||||
| By: | Perry Corp, its managing general partner | |||
| By: | /s/ Xxxxxxx X. Xxxx | |||
| Name: | Xxxxxxx X. Xxxx | |||
| Title: | General Counsel | |||
| PERRY CORP. |
||||
| By: | /s/ Xxxxxxx X. Xxxx | |||
| Name: | Xxxxxxx X. Xxxx | |||
| Title: | General Counsel | |||
| /s/ Xxxxxxx X. Xxxxx | ||||
| Xxxxxxx X. Xxxxx | ||||
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