Exhibit 1.1
[ ] SHARES
WHITE MOUNTAINS INSURANCE GROUP, LTD.
PREFERENCE SHARES
FORM OF UNDERWRITING AGREEMENT
[Note: Appropriate modifications will be made for issuances of different types
of Preference Shares]
[ ], 20[ ]
[Underwriters]
c/o
Ladies and Gentlemen:
White Mountains Insurance Group Ltd., a company existing under
the laws of Bermuda (the "Company"), proposes to sell to the several
underwriters (the "Underwriters") named in Schedule I hereto [ ] of the
Company's Preference Shares (the "Firm Shares"). The respective amounts of
the Firm Shares to be so purchased by the several Underwriters are set forth
opposite their names in Schedule I hereto. The Company also proposes to sell
at the Underwriters' option an aggregate of up to an additional [ ] of
the Company's Preference Shares (the "Option Shares") as set forth below.
As the Underwriters, you have advised the Company (a) that you are
authorized to enter into this Agreement, and (b) that the Underwriters are
willing, acting severally and not jointly, to purchase the numbers of Firm
Shares set forth opposite their respective names in Schedule I, plus their pro
rata portion of the Option Shares if you elect to
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exercise the over-allotment option in whole or in part. The Firm Shares and the
Option Shares (to the extent the aforementioned option is exercised) are herein
collectively called the "Shares".
In consideration of the mutual agreements contained herein and of
the interests of the parties in the transactions contemplated hereby, the
parties hereto agree as follows:
1. REPRESENTATIONS AND WARRANTIES OF THE COMPANY. The Company
represents and warrants as follows:
(a) A registration statement on Form S-3 (File No. ) with respect to
the Shares has been carefully prepared by the Company in conformity in all
material respects with the requirements of the Securities Act of 1933, as
amended (the "Act"), and the Rules and Regulations (the "Rules and Regulations")
of the Securities and Exchange Commission (the "Commission") thereunder and has
been filed with the Commission under the Act. The Company has complied with the
conditions for the use of Form S-3. Copies of such registration statement,
including any amendments thereto, the preliminary prospectuses (meeting the
requirements of Rules 430A, 415 and 424(b) of the Rules and Regulations)
contained therein and the exhibits, financial statements and schedules, as
finally amended and revised, have heretofore been delivered by the Company to
you. Such registration statement, together with any registration statement filed
by the Company pursuant to Rule 462(b) of the Act, herein referred to as the
"Registration Statement", which shall be deemed to include all information
omitted therefrom in reliance upon Rule 430A and contained in the Prospectus
referred to below, has been declared effective by the Commission under the Act
and no post-effective amendment to the Registration Statement has been filed as
of the date of this Agreement. "Prospectus" means (i) the form of prospectus
and/or prospectus supplement first filed by the Company with the Commission
pursuant to its Rule 424(b) or (ii) the last preliminary prospectus included in
the Registration Statement filed prior to the time it becomes effective or filed
pursuant to Rule 424(a) under the Act that is delivered by the Company to the
Underwriters for delivery to purchasers of the Shares, together with any term
sheet or abbreviated term sheet filed with the Commission
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pursuant to Rule 424(b)(7) under the Act. Each preliminary prospectus and/or
preliminary prospectus supplement included in the Registration Statement prior
to the time it becomes effective is herein referred to as a "Preliminary
Prospectus". Except as specifically set forth herein, (i) any reference herein
to any Preliminary Prospectus or the Prospectus shall be deemed to refer to and
include the documents incorporated by reference therein, as of the date of such
Preliminary Prospectus or Prospectus, as the case may be, and (ii) in the case
of any reference herein to any Prospectus, also shall be deemed to include any
documents incorporated by reference therein, and any supplements or amendments
thereto, filed with the Commission after the date of filing of the Prospectus
under Rules 415, 424(b) and 430A, and prior to the termination of the offering
of the Shares by the Underwriters.
(b) The Company has been duly organized and is validly existing as a
corporation under the laws of Bermuda, with corporate power and authority to own
or lease its properties and conduct its business as described in the
Registration Statement; each of the subsidiaries of the Company as listed on
Schedule II hereto (collectively, the "Subsidiaries") has been duly organized
and, is validly existing as a corporation in good standing under the laws of the
jurisdiction of its incorporation, with corporate power and authority to own or
lease its properties and conduct its business as described in the Registration
Statement; the Company and each of the Subsidiaries are duly qualified to
transact business in all jurisdictions in which the conduct of their business
requires such qualification and a failure to qualify would have a materially
adverse effect upon the business or financial condition of the Company and the
Subsidiaries taken as a whole; except as set forth on Schedule II hereto, the
outstanding shares of capital stock of each of the Subsidiaries owned by the
Company or a Subsidiary have been duly authorized and validly issued, are fully
paid and nonassessable and are owned by the Company or another subsidiary free
and clear of all liens, encumbrances and security interests and no options,
warrants or other rights to purchase, agreements or other obligations to issue
or other rights to convert any obligations into shares of
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capital stock or ownership interests in the Subsidiaries are outstanding.
(c) The authorized Preference Shares of the Company have been duly
authorized. The outstanding Common Shares of the Company have been duly
authorized and are validly issued, fully-paid and non-assessable; the Shares to
be issued and sold by the Company have been duly authorized and when issued and
paid for as contemplated herein will be validly issued, fully-paid and
non-assessable; and no preemptive rights of stockholders exist with respect to
any of the Shares or the issue and sale thereof. Neither the filing of the
Registration Statement nor the offering or sale of the Shares as contemplated by
this Agreement gives rise to any rights, other than those which have been waived
or satisfied, for or relating to the registration of any Common Shares of the
Company.
(d) This Agreement has been duly authorized, executed and delivered
by the Company and is a legal, valid and binding obligation of the Company
enforceable against the Company in accordance with its terms.
(e) The information set forth under the caption "Capitalization" in
the Prospectus is true and correct. The Shares conform in all material respects
with the statements concerning them in the Registration Statement.
(f) The Commission has not issued an order preventing or suspending
the use of any Prospectus relating to the proposed offering of the Shares nor
instituted proceedings for that purpose. The Registration Statement contains and
the Prospectus and any amendments or supplements thereto will contain all
statements which are required to be stated therein by, and in all material
respects conform or will conform, as the case may be, to the requirements of,
the Act and the Rules and Regulations. The documents incorporated by reference
in the Prospectus, at the time they were filed with the Commission conformed in
all material respects to the requirements of the Securities Exchange Act of 1934
or the Act, as applicable, and the Rules and Regulations of the Commission
thereunder. Neither the Registration Statement nor any amendment thereto, and
neither the Prospectus nor any supplement thereto, including any documents
incorporated by reference therein, contains or will contain, as the case may be,
any untrue statement of a
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material fact or omits or will omit to state any material fact required to be
stated therein or necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading; provided, however,
that the Company makes no representations or warranties as to information
contained in or omitted from the Registration Statement or the Prospectus, or
any such amendment or supplement, or any documents incorporated by reference
therein, in reliance upon, and in conformity with, written information furnished
to the Company by or on behalf of any Underwriter, specifically for use in the
preparation thereof.
(g) The consolidated financial statements of the Company and the
Subsidiaries, together with related notes and schedules incorporated by
reference in the Registration Statement, present fairly the financial position
and the results of operations of the Company and its subsidiaries consolidated,
at the indicated dates and for the indicated periods. Such financial statements
have been prepared in accordance with generally accepted principles of
accounting, consistently applied throughout the periods involved, and all
adjustments necessary for a fair presentation of results for such periods have
been made. The selected and summary financial and statistical data included in
the Registration Statement present fairly the information shown therein and have
been compiled on a basis consistent with the financial statements incorporated
by reference therein and the books and records of the Company. The pro forma
financial information included in the Registration Statement and the Prospectus
present fairly the information shown therein, have been properly compiled on the
pro forma bases described therein, and, in the opinion of the Company, the
assumptions used in the preparation thereof are reasonable and the adjustments
used therein are appropriate to give effect to the transactions or circumstances
referred to therein.
(h) Except for those license renewal applications of the Company or
its Subsidiaries currently pending before the Federal Communications Commission
(the "FCC"), a description of which is set forth on Schedule II hereto or as set
forth in the Registration Statement, there is no
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action or proceeding pending or, to the knowledge of the Company, threatened
against the Company or any of the Subsidiaries before any court or
administrative agency which could reasonably be likely to result in any material
adverse change in the earnings, business, management, properties, assets,
rights, operations, condition (financial or otherwise) of the Company and of the
Subsidiaries (taken as a whole).
(i) The Company and the Subsidiaries have good and marketable title
to all of the properties and assets reflected in the financial statements
hereinabove described (or as described in the Registration Statement) subject to
no material lien, mortgage, pledge, charge or encumbrance of any kind, except
those reflected in such financial statements or as described in the Registration
Statement or set forth on Schedule II. The Company and the Subsidiaries occupy
their leased properties under valid leases with such exceptions as are not
material to the Company and the Subsidiaries taken as a whole and do not
materially interfere with the use made and proposed to be made of such
properties by the Company and the Subsidiaries.
(j) The Company and the Subsidiaries have filed all Federal, state
and foreign income tax returns which have been required to be filed and have
paid all taxes indicated by said returns and all assessments received by them or
any of them to the extent that such taxes have become due and are not being
contested in good faith. The Company has no knowledge of any tax deficiency that
has been or might be asserted against the Company.
(k) Since the respective dates as of which information is given in
the Registration Statement, as it may be amended or supplemented, there has not
been any material adverse change or any development involving a prospective
material adverse change in or affecting the earnings, business, management,
properties, assets, rights, operations, condition (financial or otherwise) or
business prospects of the Company and its Subsidiaries (taken as a whole),
whether or not occurring in the ordinary course of business, other than general
economic and industry conditions changes in the ordinary course of business and
changes or transactions described or contemplated in the Registration Statement
and there has not been any material
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transaction entered into by the Company or the Subsidiaries, other than
transactions in the ordinary course of business and changes and transactions
contemplated by the Registration Statement, as it may be amended or
supplemented. None of the Company or the Subsidiaries have any material
contingent obligations which are not disclosed in the Registration Statement, as
it may be amended or supplemented.
(l) Neither the Company nor any of the Subsidiaries is or with the
giving of notice or lapse of time or both, will be in default under its Articles
of Incorporation or By-Laws or any agreement, lease, contract, indenture or
other instrument or obligation to which it is a party or by which it, or any of
its properties, is bound and which default is of material significance in
respect of the business or financial condition of the Company and its
Subsidiaries (taken as a whole). The execution and delivery of this Agreement
and the consummation of the transactions herein contemplated and the fulfillment
of the terms hereof will not conflict with or result in a breach of any of the
terms or provisions of, or constitute a default under, any indenture, mortgage,
deed of trust or other material agreement or instrument to which the Company or
any Subsidiary is a party, or of the Articles of Incorporation or by-laws of the
Company or any order, rule or regulation applicable to the Company or any
Subsidiary, or of any court or of any regulatory body or administrative agency
or other governmental body having jurisdiction, except in all cases a conflict,
breach or default which would not have a materially adverse effect on the
business or financial condition of the Company and the Subsidiaries (taken as a
whole).
(m) Each approval, consent, order, authorization, designation,
declaration or filing by or with any regulatory, administrative or other
governmental body necessary in connection with the execution and delivery by the
Company of this Agreement and the consummation of the transactions herein
contemplated (except such additional steps as may be required by the National
Association of Securities Dealers, Inc. (the "NASD") or the New York Stock
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Exchange ("NYSE") or may be necessary to qualify the Shares for public offering
by the Underwriters under State securities or Blue Sky laws) has been obtained
or made and is in full force and effect.
(n) The Company and each of the Subsidiaries hold all material
licenses, certificates and permits from governmental authorities, including
without limitation, the FCC, which are necessary to the conduct of their
businesses; and neither the Company nor any of the Subsidiaries has received
notice of any infringement of any material patents, patent rights, trade names,
trademarks or copyrights, which infringement is material to the business of the
Company and the Subsidiaries (taken as a whole).
(o) [ ], [ ] and [ ], each of whom have certified
certain of the financial statements incorporated by reference in the
Registration Statement and Prospectus, are to the knowledge of the Company
independent public accountants as required by the Act and the Rules and
Regulations.
(p) To the Company's knowledge, there are no affiliations or
associations between any member of the NASD and any of the Company's officers,
directors or 5% or greater security holders except as otherwise disclosed in
writing to [name specific underwriter].
(q) Neither the Company, nor to the Company's knowledge, any of the
Subsidiaries, has taken or may take, directly or indirectly, any action designed
to cause or result in, or which has constituted or which might reasonably be
expected to constitute, the stabilization or manipulation of the price of Common
Shares of the Company to facilitate the sale or resale of the Shares. The
Company acknowledges that the Underwriters may engage in passive market making
transactions in the Shares on the NYSE in accordance (and in compliance) with
Regulation M under the Exchange Act.
(r) Neither the Company nor any Subsidiary is an "investment
company" within the meaning of such term under the Investment Company Act of
1940 and the rules and regulations of the Commission thereunder.
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(s) The Company maintains a system of internal accounting controls
sufficient to provide reasonable assurances that (i) transactions are executed
in accordance with management's general or specific authorization; (ii)
transactions are recorded as necessary to permit preparation of financial
statements in conformity with generally accepted accounting principles and to
maintain accountability for assets; (iii) access to assets is permitted only in
accordance with management's general or specific authorization; and (iv) the
recorded accountability for assets is compared with existing assets at
reasonable intervals and appropriate action is taken with respect to any
differences.
(t) The Company and each of its Subsidiaries carry, or are covered
by, insurance in such amounts and covering such risks as is adequate for the
conduct of their respective businesses and the value of their respective
properties and as is customary for companies engaged in similar industries.
(u) The Company is in compliance in all material respects with all
presently applicable provisions of the Employee Retirement Income Security Act
of 1974, as amended, including the regulations and published interpretations
thereunder ("ERISA"); no "reportable event" (as defined in ERISA) for which the
Company would have any liability has occurred and is continuing; the Company has
not incurred and does not expect to incur liability under (i) Title IV of ERISA
with respect to termination of, or withdrawal from, any "pension plan" or (ii)
Sections 412 or 4971 of the Internal Revenue Code of 1986, as amended, including
the regulations and published interpretations thereunder (the "Code"); and each
"pension plan" for which the Company would have any liability that is intended
to be qualified under Section 401(a) of the Code is so qualified in all material
respects and nothing has occurred, whether by action or by failure to act, which
would cause the loss of such qualification.
(v) The information set forth in the Prospectus under the caption
"Prospectus Summary-Recent Developments"
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is true and correct in all material respects.
Any certificate signed by any officer of the Company and delivered
to the Underwriters in connection with the offering of the Shares should be
deemed a representation and warranty of the Company, as to matters covered
thereby, to each Underwriter.
2. PURCHASE, SALE AND DELIVERY OF THE SHARES. (a) On the basis of
the representations, warranties and covenants herein contained, and subject to
the conditions herein set forth, the Company agrees to sell to the Underwriters
the Shares, and each Underwriter agrees, severally and not jointly, to purchase
at a price of $[ ] per share, the number of Firm Shares set forth opposite the
name of each Underwriter in Schedule I hereof, subject to adjustments in
accordance with Section 9 hereof.
(b) Payment for the Firm Shares to be sold hereunder by the Company
is to be made via wire transfer of immediately available funds or such other
payment procedures agreed to by the parties. Such payment and delivery are to be
made at the offices of [name specific underwriter], at 10:00 a.m., time, on the
third business day after the date of this Agreement or at such other time and
date not later than five business days thereafter as you and the Company shall
agree upon, such time and date being herein referred to as the "Closing Date."
(As used herein, "business day" means a day on which the New York Stock Exchange
is open for trading and on which banks in New York are open for business and not
permitted by law or executive order to be closed.) The certificates for the Firm
Shares will be delivered in such denominations and in such registrations as the
Underwriters request in writing not later than the second full business day
prior to the Closing Date, and will be made available for inspection by the
Underwriters at least one business day prior to the Closing Date.
(c) In addition, on the basis of representations and warranties
herein contained and subject to the terms and conditions herein set forth, the
Company hereby grants an option to the several Underwriters to purchase the
Option Shares at the price per share as set forth in the first paragraph of this
Section 2. The option granted hereby may be exercised in whole or in part by
giving written notice
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only once within 30 days after the date of this Agreement, by you, the
Underwriters, to the Company, setting forth the number of Option Shares as to
which the several Underwriters are exercising the option, the names and
denominations in which the Option Shares are to be registered and the time and
date at which such certificates are to be delivered. The time and date at which
certificates for Option Shares are to be delivered shall be determined by the
Underwriters but shall not be earlier than three nor later than ten full
business days after the exercise of such option, nor in any event prior to the
Closing Date (such time and date being herein referred to as the "Option Closing
Date"). If the date of exercise of the option is three or more days before the
Closing Date, the notice of exercise shall set the Closing Date as the Option
Closing Date. The option with respect to the Option Shares granted hereunder may
be exercised only to cover over-allotments in the sale of the Firm Shares by the
Underwriters. You, the Underwriters, may cancel such option at any time prior to
its expiration by giving written notice of such cancelation to the Company. To
the extent, if any, that the option is exercised, payment for the Option Shares
shall be made on the Option Closing Date via wire transfer of immediately
available funds or other payment procedures agreed to by the parties against
delivery of certificates therefor at the offices of [name specific underwriter].
3. OFFERING BY THE UNDERWRITERS. It is understood that the
Underwriters are to make a public offering of the Firm Shares as soon as the
Underwriters deem it advisable to do so. The Firm Shares are to be initially
offered to the public at the public offering price set forth in the Prospectus.
The Underwriters may from time to time thereafter change the public offering
price and other selling terms. To the extent, if at all, that any Option Shares
are purchased pursuant to Section 2 hereof, the Underwriters will offer them to
the public on the foregoing terms.
It is further understood that you will act as the Underwriters in
the offering and sale of the Shares will take place in accordance with a Master
Agreement Among
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Underwriters entered into by you and the several other Underwriters.
4. COVENANTS OF THE COMPANY. The Company covenants and agrees with
the several Underwriters that:
(a) The Company will (i) prepare and timely file with the Commission
under Rule 424(b) of the Rules and Regulations a Prospectus containing
information previously omitted at the time of effectiveness of the Registration
Statement in reliance on Rule 430A of the Rules and Regulations, (ii) not file
any amendment to the Registration Statement or any Rule 462(b) registration
statement or supplement to the Prospectus or documents incorporated by reference
therein of which the Underwriters shall not previously have been advised and
furnished with a copy or to which the Underwriters shall have reasonably
objected in writing or which is not in compliance with the Rules and Regulations
and (iii) file on a timely basis all reports and any definitive proxy or
information statements required to be filed by the Company with the Commission
subsequent to the date of the Prospectus and prior to the termination of the
offering of the Shares by the Underwriters.
(b) The Company will advise the Underwriters promptly of any request
of the Commission for amendment of the Registration Statement or for supplement
to the Prospectus or for any additional information, or of the issuance by the
Commission of any stop order suspending the effectiveness of the Registration
Statement or the use of the Prospectus or of the institution of any proceedings
for that purpose, and the Company will use reasonable efforts to prevent the
issuance of any such stop order preventing or suspending the use of the
Prospectus and to obtain as soon as possible the lifting thereof, if issued.
(c) The Company will deliver to, or upon the order of, the
Underwriters, from time to time, as many copies of any Preliminary Prospectus as
the Underwriters may reasonably request. The Company will deliver to, or upon
the order of, the Underwriters during the period when delivery of a Prospectus
is required under the Act, as many copies of the Prospectus in final form, or as
thereafter amended or supplemented, as the Underwriters may reasonably request.
The Company will deliver to the Underwriters at or
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before the Closing Date, four signed copies of the Registration Statement and
all amendments thereto including all exhibits filed therewith, and will deliver
to the Underwriters such number of copies of the Registration Statement, but
without exhibits, and of all amendments thereto, as the Underwriters may
reasonably request, including documents incorporated by reference therein.
(d) The Company will make generally available to its security
holders, as soon as it is practicable to do so, but in any event not later than
15 months after the effective date of the Registration Statement, an earnings
statement (which need not be audited) in reasonable detail, covering a period of
at least 12 consecutive months beginning after the effective date of the
Registration Statement, which earnings statement shall satisfy the requirements
of Section 11(a) of the Act and Rule 158 of the Rules and Regulations and will
advise you in writing when such statement has been so made available.
(e) The Company will, for a period of five years from the Closing
Date, deliver or make available to the Underwriters copies of annual reports and
copies of all other documents, reports and information furnished by the Company
to its stockholders or filed with any securities exchange pursuant to the
requirements of such exchange or with the Commission pursuant to the Act or the
Securities Exchange Act of 1934, as amended (the "Exchange Act").
(f) No offering, sale, short sale or other disposition of any
Preference Shares of the Company or other securities convertible into or
exchangeable or exercisable for Preference Shares of the Company will be made
by the Company for a period of [ ] days after the date of this Agreement,
directly or indirectly, by the Company otherwise than hereunder, or with the
prior written consent of [name specific underwriter], except that the Company
may, without such consent, grant options or issue Preference Shares of the
Company pursuant to the exercise of options granted under the Company's
current stock option plans and may offer or issue Preference Shares of the
Company in connection with the acquisition of stock or assets of another
person.
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(g) The Company will comply with the Act and the Rules and
Regulations, and the Exchange Act, and the rules and regulations of the
Commission thereunder, so as to permit the completion of the distribution of the
Shares as contemplated in this Agreement and the Prospectus. If during the
period in which a prospectus is required by law to be delivered by an
Underwriter or dealer, any event shall occur as a result of which, in the
judgment of the Company or in the reasonable opinion of the Underwriters, it
becomes necessary to amend or supplement the Prospectus in order to make the
statements therein, in the light of the circumstances existing at the time the
Prospectus is delivered to a purchaser, not misleading, or, if it is necessary
at any time to amend or supplement the Prospectus to comply with any law, the
Company promptly will either (i) prepare and file with the Commission an
appropriate amendment to the Registration Statement or supplement to the
Prospectus or (ii) prepare and file with the Commission an appropriate filing
under the Exchange Act which shall be incorporated by reference in the
Prospectus so that the Prospectus as so amended or supplemented will not, in the
light of the circumstances when it is so delivered, be misleading, or so that
the Prospectus will comply with the law.
(h) The Company will use its best efforts to list, subject to notice
of issuance, the Shares on the NYSE.
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(i) The Company shall not invest, or otherwise use the proceeds
received by the Company from its sale of the Shares in such a manner as would
require the Company or any of the Subsidiaries to register as an investment
company under the Investment Company Act of 1940, as amended (the "1940 Act").
(j) The Company will maintain a transfer agent and, if necessary
under the jurisdiction of incorporation of the Company, a registrar for the
Preference Shares of the Company.
(k) The Company will not take, directly or indirectly, any action
designed to cause or result in, or that has constituted or might reasonably be
expected to constitute, the stabilization or manipulation of the price of any
securities of the Company.
5. COSTS AND EXPENSES. The Company will pay all costs, expenses and
fees incident to the performance of the obligations of the Company under this
Agreement, including, without limiting the generality of the foregoing, the
following: accounting fees of the Company; the fees and disbursements of counsel
for the Company; the cost of printing and delivering to, or as requested by, the
Underwriters copies of the Registration Statement, Preliminary Prospectuses, the
Prospectus, this Agreement; fees and expenses related to Blue Sky matters; the
filing fees of the Commission; and the filing fees of the NASD. The Company
shall not, however, be required to pay for any of the Underwriters' expenses
except that, if this Agreement shall not be consummated because the conditions
in Section 8 hereof are not satisfied, or because this Agreement is terminated
by the Underwriters pursuant to Section 7 hereof, or by reason of any failure,
refusal or inability on the part of the Company to perform any undertaking or
satisfy any condition of this Agreement or to comply with any of the terms
hereof on its part to be performed, unless such failure to satisfy said
condition or to comply with said terms is due to the default or omission of any
Underwriter, then the Company shall reimburse the several Underwriters for
reasonable out-of-pocket expenses, including fees and
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disbursements of counsel, reasonably incurred in connection with investigating,
marketing and proposing to market the Shares or in contemplation of performing
their obligations hereunder; but the Company shall not in any event be liable to
any of the several Underwriters for damages on account of loss of anticipated
profits from the sale by them of the Shares.
6. CONDITIONS OF OBLIGATIONS OF THE UNDERWRITERS. The several
obligations of the Underwriters to purchase the Firm Shares on the Closing Date
and the Option Shares, if any, on the Option Closing Date are subject to the
accuracy, as of the Closing Date or the Option Closing Date, as the case may be,
of the representations and warranties of the Company contained herein, and to
the performance by the Company of its covenants and obligations hereunder and to
the following additional conditions:
(a) The Registration Statement and all post-effective amendments
thereto shall have become effective and any and all filings required by Rule
415, Rule 424 and Rule 430A of the Rules and Regulations shall have been made,
and any request of the commission for additional information (to be included in
the Registration Statement or otherwise) shall have been disclosed to the
Underwriters and complied with to their reasonable satisfaction. No stop order
suspending the effectiveness of the Registration Statement, as amended from time
to time, shall have been issued and no proceedings for that purpose shall have
been taken or, to the knowledge of the Company, shall be contemplated by the
Commission and no injunction, restraining order, or order of any nature by a
Federal or state court of competent jurisdiction shall have been issued as of
the Closing Date which would prevent the issuance of the Shares.
(b) The Underwriters shall have received on the Closing Date or the
Option Closing Date, as the case may be, the opinion of Cravath, Swaine & Xxxxx,
counsel for the Company, and Xxxxxxx, Xxxx & Xxxxxxx, Bermuda counsel for the
Company, each dated the Closing Date or the Option Closing Date, as the case may
be, addressed to the Underwriters substantially in the form attached hereto as
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Exhibits A and B, respectively, and a 10b-5 statement from Cravath, Swaine &
Xxxxx, substantially in the form attached hereto as Exhibit C.
(c) The Underwriters shall have received on each of the date hereof,
the Closing Date or the Option Closing Date, as the case may be, signed letters
from [ ], [ ] and [ ], dated the Closing Date or the Option
Closing Date, as the case may be, which shall confirm, on the basis of a review
in accordance with the procedures set forth in the letters signed by such firms
and dated and delivered to the Underwriters on the date hereof that nothing has
come to their attention during the period from the date five days prior to the
date hereof, to a date not more than five days prior to the Closing Date or the
Option Closing Date, as the case may be, which would require any change in their
letter dated the date hereof if it were required to be dated and delivered on
the Closing Date or the Option Closing Date, as the case may be. All such
letters shall be in form and substance satisfactory to the Underwriters.
(d) The Underwriters shall have received on the Closing Date or the
Option Closing Date, as the case may be, a certificate or certificates of the
President or Chief Executive Officer and the Senior Vice President and Chief
Accounting Officer of the Company to the effect that, as of the Closing Date or
the Option Closing Date, as the case may be, each of them severally represents
as follows:
(i) The Registration Statement has become effective under the Act
and no stop order suspending the effectiveness of the Registration
Statement has been issued, and no proceedings for such purpose have been
taken or are, to his knowledge, contemplated by the Commission.
(ii) There is no litigation instituted or threatened against the
Company of a character required to be disclosed in the Registration
Statement which is not so disclosed.
(iii) He has carefully examined the Registration Statement and the
Prospectus and, as of the effective date of the Registration Statement,
the statements
18
contained in the Registration Statement were true and correct in all
material respects, and such Registration Statement and Prospectus did not
omit to state a material fact required to be stated therein or necessary
in order to make the statements therein not misleading and, in his
opinion, since the effective date of the Registration Statement, no event
has occurred which should have been set forth in a supplement to or an
amendment of the Prospectus which has not been so set forth in such
supplement or amendment.
(e) The Company shall have furnished to the Underwriters such
further certificates and documents confirming the representations and warranties
contained herein and related matters as the Underwriters may reasonably have
requested.
(f) The Firm Shares and Option Shares, if any, have been approved
for listing upon official notice of issuance on the NYSE.
The opinions and certificates mentioned in this Agreement shall be
deemed to be in compliance with the provisions hereof only if they are in all
material respects reasonably satisfactory to the Underwriters and to [ ],
counsel for the Underwriters.
If any of the conditions hereinabove provided for in this Section 6
shall not have been fulfilled when and as required by this Agreement to be
fulfilled, the obligations of the Underwriters hereunder may be terminated by
the Underwriters by notifying the Company of such termination in writing or by
telegram at or prior to the Closing Date or the Option Closing Date, as the case
may be. In such event, the Company and the Underwriters shall not be under any
obligation to each other (except to the extent provided in Sections 5 and 8
hereof).
7. CONDITIONS OF THE OBLIGATIONS OF THE COMPANY. The obligations of
the Company to sell and deliver the Shares required to be delivered as and when
specified in
19
this Agreement are subject to the conditions that at the Closing Date or the
Option Closing Date, as the case may be, no stop order suspending the
effectiveness of the Registration Statement shall have been issued and in effect
or proceedings therefor initiated or threatened.
8. INDEMNIFICATION. (a) The Company agrees to indemnify and hold
harmless each Underwriter and each person, if any, who controls any Underwriter
within the meaning of the Act against any losses, claims, damages or liabilities
to which such Underwriter or such controlling person may become subject under
the Act or otherwise, insofar as such losses, claims, damages or liabilities (or
actions or proceedings in respect thereof) arise out of or are based upon (i)
any untrue statement or alleged untrue statement of any material fact contained
in the Registration Statement, any Preliminary Prospectus, the Prospectus or any
amendment or supplement thereto, or (ii) the omission or alleged omission to
state therein a material fact required to be stated therein or necessary to make
the statements therein not misleading, and will reimburse each Underwriter and
each such controlling person for any legal or other expenses reasonably incurred
by such Underwriter or such controlling person in connection with investigating
or defending any such loss, claim, damage, liability, action or proceeding;
provided, however, that the Company will not be liable in any such case to the
extent that any such loss, claim, damage or liability arises out of or is based
upon an untrue statement or alleged untrue statement, or omission or alleged
omission made in the Registration Statement, any Preliminary Prospectus, the
Prospectus, or such amendment or supplement, in reliance upon and in conformity
with written information furnished to the Company by or through the Underwriters
specifically for use in the preparation thereof, and provided further that the
Company shall not be liable with respect to any untrue statement contained in or
any omission from a Preliminary Prospectus if the untrue statement contained in
or such omission from such Preliminary Prospectus was corrected in the
applicable Prospectus and the person asserting any such loss, liability, claim
or damage was not given or sent a copy of the applicable Prospectus (excluding
the documents incorporated by reference therein) in the manner and at such time
as required by the Act, provided the Company has furnished you copies of such
applicable Prospectus. This
20
indemnity agreement will be in addition to any liability which the Company may
otherwise have.
(b) Each Underwriter will indemnify and hold harmless the Company,
each of its directors or nominees for director, each of its officers who have
signed the Registration Statement, and each person, if any, who controls the
Company within the meaning of the Act, against any losses, claims, damages or
liabilities to which the Company or any such director, nominee for director,
officer, or controlling person may become subject under the Act or otherwise,
insofar as such losses, claims, damages or liabilities (or actions or
proceedings in respect thereof) arise out of or are based upon any untrue
statement or alleged untrue statement of any material fact contained in the
Registration Statement, any Preliminary Prospectus, the Prospectus or any
amendment or supplement thereto, or arise out of or are based upon the omission
or the alleged omission to state therein a material fact required to be stated
therein or necessary to make the statements therein not misleading in the light
of the circumstances under which they were made; and will reimburse any legal or
other expenses reasonably incurred by the Company, any such director, nominee
for director, officer, or controlling person in connection with investigating or
defending any such loss, claim, damage, liability, action or proceeding;
provided, however, that each Underwriter will be liable in each case to the
extent, but only to the extent, that such untrue statement or alleged untrue
statement or omission or alleged omission has been made in the Registration
Statement, any Preliminary Prospectus, the Prospectus or such amendment or
supplement, in reliance upon and in conformity with written information
furnished to the Company by such Underwriter or through the Underwriters on
behalf of such Underwriter specifically for use in the preparation thereof. This
indemnity agreement will be in addition to any liability which such Underwriter
may otherwise have.
(c) In case any proceeding (including any governmental
investigation) shall be instituted involving any person in respect of which
indemnity may be sought pursuant to this Section 8, such person (the
"indemnified party") shall promptly notify the person against whom such
21
indemnity may be sought (the "indemnifying party") in writing. No
indemnification provided for in Section 8(a) or (b) shall be available to any
party who shall fail to give notice as provided in this Section 8(c) if the
party to whom notice was not given was unaware of the proceeding to which such
notice would have related and was prejudiced by the failure to give such notice,
but the failure to give such notice shall not relieve the indemnifying party or
parties from any liability which it or they may have to the indemnified party
for contribution or otherwise than on account of the provisions of Section 8(a)
or (b). In case any such proceeding shall be brought against any indemnified
party and it shall notify the indemnifying party of the commencement thereof,
the indemnifying party shall be entitled to participate therein and, to the
extent that it shall wish, jointly with any other indemnifying party similarly
notified, to assume the defense thereof, with counsel satisfactory to such
indemnified party and shall pay as incurred the fees and disbursements of such
counsel related to such proceeding. In any such proceeding, any indemnified
party shall have the right to retain its own counsel at its own expense.
Notwithstanding the foregoing, the indemnifying party shall pay as incurred (or
within 30 days of presentation) the fees and expenses of the counsel retained by
the indemnified party (and, if any reasonably necessary, one additional local
counsel) in the event (i) the indemnifying party and the indemnified party shall
have mutually agreed to the retention of such counsel or (ii) the named parties
to any such proceeding (including any impleaded parties) include both the
indemnifying party and the indemnified party and representation of both parties
by the same counsel would be inappropriate due to actual or potential differing
interests between them. It is understood that the indemnifying party shall not,
in connection with any proceeding or related proceedings in the same
jurisdiction, be liable for the reasonable fees and expenses of more than one
separate firm for all such indemnified parties. Such firm shall be selected by
you in the case of parties indemnified pursuant to Section 8(a) and by the
Company in the event of parties indemnified pursuant to Section 8(b). The
indemnifying party shall not be 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
22
against any loss or liability by reason of such settlement or judgment.
(d) If the indemnification provided for in this Section 8 is
unavailable to or insufficient to hold harmless an indemnified party under
Section 8(a) or (b) above in respect of any losses, claims, damages or
liabilities (or actions or proceedings in respect thereof) referred to therein,
then each indemnifying party shall contribute to the amount paid or payable by
such indemnified party as a result of such losses, claims, damages or
liabilities (or actions or proceedings in respect thereof) in such proportion as
is appropriate to reflect the relative benefits received by the Company on the
one hand and the Underwriters on the other from the offering of the Shares. If,
however, the allocation provided by the immediately preceding sentence is not
permitted by applicable law, then each indemnifying party shall contribute to
such amount paid or payable by such indemnified party in such proportion as is
appropriate to reflect not only such relative benefits but also the relative
fault of the Company on the one hand and the Underwriters on the other in
connection with the statements or omissions which resulted in such losses,
claims, damages or liabilities (or actions or proceedings in respect thereof),
as well as any other relevant equitable considerations. The relative benefits
received by the Company on the one hand and the Underwriters on the other shall
be deemed to be in the same proportion as the total net proceeds from the
offering (before deducting expenses) received by the Company bear to the total
underwriting discounts and commissions received by the Underwriters, in each
case as set forth in the table on the cover page of the Prospectus. 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 Company
on the one hand or the Underwriters on the other and the parties' relative
intent, knowledge, access to information and opportunity to correct or prevent
such statement or omission. No party shall be held liable for contribution with
respect to any claim or action settled without its consent which shall not be
23
unreasonably withheld. Such consent shall be given within three business days
from the date on which the party requesting consent provides a written request
to the other party.
The Company and the Underwriters agree that it would not be just and
equitable if contributions pursuant to this Section 8(d) were determined by pro
rata allocation (even if the Underwriters were treated as one entity for such
purpose) or by any other method of allocation which does not take account of the
equitable considerations referred to above in this Section 8(d). The amount paid
or payable by an indemnified party as a result of the losses, claims, damages or
liabilities (or actions or proceedings in respect thereof) referred to above in
this Section 8(d) shall be deemed to include any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating
or defending any such action or claim. Notwithstanding the provisions of this
subsection (d), (i) no Underwriter shall be required to contribute any amount in
excess of the underwriting discounts and commissions applicable to the Shares
purchased by such Underwriter and (ii) no person guilty of fraudulent
misrepresentation (within the meaning of Section 11(f) of the Act) shall be
entitled to contribution from any person who was not guilty of such fraudulent
misrepresentation. The Underwriters' obligations in this Section 8(d) to
contribute are several in proportion to their respective underwriting
obligations and not joint.
(e) In any proceeding relating to the Registration Statement, any
Preliminary Prospectus, the Prospectus or any supplement or amendment thereto,
each party against whom contribution may be sought under this Section 8 hereby
consents to the jurisdiction of any court having jurisdiction over any other
contributing party, agrees that process issuing from such court may be served
upon him or it by any other contributing party and consents to the service of
such process and agrees that any other contributing party may join him or it as
an additional defendant in any such proceeding in which such other contributing
party is a party.
24
(f) Any losses, claims, damages, liabilities or expenses for which
an indemnified party is entitled to indemnification or contribution under this
Section 8 shall be paid by the indemnifying party to the indemnified party as
such losses, claims, damages, liabilities or expenses are incurred. The
indemnity and contribution agreements contained in this Section 8 and the
representations and warranties of the Company set forth in this Agreement shall
remain operative and in full force and effect, regardless of (i) any
investigation made by or on behalf of any Underwriter or any person controlling
any Underwriter, the Company, or its directors, nominees for director or
officers or any persons controlling the Company, (ii) acceptance of any Shares
and payment therefor hereunder, and (iii) any termination of this Agreement. A
successor to any Underwriter, or to the Company, or their respective directors
or officers, or any person controlling the Company, shall be entitled to the
benefits of the indemnity, contribution and reimbursement agreements contained
in this Section 8.
9. DEFAULT BY UNDERWRITERS. If on the Closing Date or the Option
Closing Date, as the case may be, any Underwriter shall fail to purchase and pay
for the portion of the Shares which such Underwriter has agreed to purchase and
pay for on such date (otherwise than by reason of any default on the part of the
Company, the non-defaulting Underwriters shall use their best efforts to procure
within 24 hours thereafter one or more of the other Underwriters, or any others,
to purchase from the Company such amounts as may be agreed upon and upon the
terms set forth herein, the Firm Shares or Option Shares, as the case may be,
which the defaulting Underwriter or Underwriters failed to purchase. If during
such 24 hours you, the non-defaulting Underwriters, shall not have procured such
other Underwriters, or any others, to purchase the Firm Shares or Option Shares,
as the case may be, agreed to be purchased by the defaulting Underwriter or
Underwriters, then (a) if the aggregate number of shares with respect to which
such default shall occur does not exceed 10% of the Firm Shares or Option
Shares, as the case may be, covered hereby, the other Underwriters shall be
obligated, severally, in proportion to the respective numbers of Firm Shares or
Option Shares, as the case may be, which they are obligated
25
to purchase hereunder, to purchase the Firm Shares or Option Shares, as the case
may be, which such defaulting Underwriter or Underwriters failed to purchase, or
(b) if the aggregate number of shares of Firm Shares or Option Shares, as the
case may be, with respect to which such default shall occur exceeds 10% of the
Firm Shares or Option Shares, as the case may be, covered hereby, the Company or
you as the Underwriters will have the right, by written notice given within the
next 24-hour period to the parties to this Agreement, to terminate this
Agreement without liability on the part of the non-defaulting Underwriters or of
the Company except to the extent provided in Section 9 hereof. In the event of a
default by any Underwriter or Underwriters, as set forth in this Section 9, the
Closing Date or Option Closing Date, as the case may be, may be postponed for
such period, not exceeding seven days, as you, the non-defaulting Underwriters,
may determine in order that the required changes in the Registration Statement
or in the Prospectus or in any other documents or arrangements may be effected.
The term "Underwriter" includes any person substituted for a defaulting
Underwriter. Any action taken under this Section 9 shall not relieve any
defaulting Underwriter from liability in respect of any default of such
Underwriter under this Agreement.
10. NOTICES. All communications hereunder shall be in writing and,
except as otherwise provided herein, will be mailed, delivered or telegraphed
and confirmed as follows: if to the Underwriters, to [ ], [ ],
Attention: [ ], Managing Director; if to the Company, to White Mountains
Insurance Group, Ltd., 00 Xxxxx Xxxx Xxxxxx, Xxxxxxx, Xxx Xxxxxxxxx 00000-0000,
attention: [ ].
11. TERMINATION. This Agreement may be terminated by you by notice
to the Company as follows:
(a) at any time prior to the earlier of (i) the time the Shares are
released by you for sale by notice to the Underwriters, or (ii) 11:30 A.M. on
the date of this Agreement;
(b) at any time prior to the Closing Date if any
26
of the following has occurred: (i) since the effective date of the Registration
Statement, any material adverse change or any development involving a
prospective material adverse change in or affecting the condition, financial or
otherwise, of the Company and its Subsidiaries taken as a whole or the earnings,
business affairs, management or business prospects of the Company and its
Subsidiaries taken as a whole, whether or not arising in the ordinary course of
business, (ii) any outbreak of hostilities or other national or international
calamity or crisis or change in economic or political conditions if the effect
of such outbreak, calamity, crisis or change on the financial markets of the
United States would, in your reasonable judgment, make the offering or delivery
of the Shares impracticable, (iii) suspension of trading in securities on the
NYSE or limitation on prices for securities on the NYSE, (iv) the enactment,
publication, decree or other promulgation of any federal or state statute,
regulation, rule or order of any court or other governmental authority which in
your reasonable opinion materially and adversely affects or will materially or
adversely affect the business or operations of the Company and the Subsidiaries
taken as a whole, (v) declaration of a banking moratorium by either Federal or
New York State authorities or (vi) the taking of any action by any Federal,
state or local government or agency in respect of its monetary or fiscal affairs
which in your reasonable opinion has a material adverse effect on the securities
markets in the United States; or
(c) as provided in Sections 6 and 9 of this Agreement.
This Agreement also may be terminated by you, by notice to the
Company, as to any obligation of the Underwriters to purchase the Option Shares,
upon the occurrence at any time prior to the Option Closing Date of any of the
events described in subparagraph (b) above or as provided in Sections 6 and 9 of
this Agreement.
12. SUCCESSORS. This Agreement has been and is made solely for the
benefit of the Underwriters, the Company and their respective successors,
executors, administrators, heirs and assigns, and the officers, directors and
controlling persons referred to herein, and no other person will have any right
or obligation hereunder. The term
27
"successors" shall not include any purchaser of the Shares merely because of
such purchase.
13. INFORMATION PROVIDED BY UNDERWRITERS. The Company and the
Underwriters acknowledge and agree that the only information furnished or to be
furnished by any Underwriter to the Company for inclusion in any Prospectus or
the Registration Statement consists of the information set forth in the last
paragraph on the front cover page (insofar as such information relates to the
Underwriters), legends required by Item 502(d) of Regulation S-K and Regulation
M under the Act and the information under the caption "Underwriting" in the
Prospectus.
14. MISCELLANEOUS. The reimbursement, indemnification and
contribution agreements contained in this Agreement and the representations,
warranties and covenants in this Agreement shall remain in full force and effect
regardless of (a) any termination of this Agreement, (b) any investigation made
by or on behalf of any Underwriter or controlling person thereof, or by or on
behalf of the Company or its directors or officers and (c) delivery of and
payment for the Shares under this Agreement.
This Agreement may be executed in two or more counterparts, each of
which shall be deemed an original, but all of which together shall constitute
one and the same instrument.
This Agreement shall be governed by, and construed in accordance
with, the laws of the State of New York.
28
If the foregoing letter is in accordance with your understanding of
our agreement, please sign and return to us the enclosed duplicates hereof,
whereupon it will become a binding agreement among the Company and the several
Underwriters in accordance with its terms.
Very truly yours,
WHITE MOUNTAINS INSURANCE
GROUP, LTD.,
By
Name:
Title:
The foregoing Underwriting Agreement is hereby confirmed and
accepted as of the date first above written.
By
By
Authorized Officer
SCHEDULE I
SCHEDULE OF UNDERWRITERS
NUMBER OF
FIRM SHARES
UNDERWRITER TO BE PURCHASED
----------- ---------------
Total _______________
SCHEDULE II
DISCLOSURE ITEMS
1. Material Subsidiaries
2. Liens, capitalization except for Subsidiary Stock
3. Pending Renewal applications
4. White Mountains Common Shares exceptions
5. [other]
EXHIBIT A
[Form of Opinion of Cravath, Swaine & Xxxxx]
EXHIBIT B
[Form Of Opinion of Xxxxxxx, Xxxx & Xxxxxxx]
EXHIBIT C
[Form of 10b-5 Statement of Cravath, Swaine & Xxxxx]
