EXHIBIT C
EXECUTION VERSION
August 9, 2006
Citigroup Global Markets Inc.
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs and Mesdames:
American International Group, Inc., a Delaware corporation (the
"SELLING SHAREHOLDER"), proposes to sell to the several Underwriters named in
Schedule I hereto (the "UNDERWRITERS") for whom you are acting as representative
(the "REPRESENTATIVE") 13,397,000 common shares, $.01 par value per share (the
"FIRM SHARES") of IPC Holdings, Ltd. (the "COMPANY"). The Selling Shareholder
also proposes to sell to the several Underwriters not more than an additional
2,000,000 of the Company's common shares, $.01 par value per share (the
"ADDITIONAL SHARES"), if and to the extent that you, as the Representative of
the offering, shall have determined to exercise, on behalf of the Underwriters,
the right to purchase such common shares granted to the Underwriters in Section
3 hereof. The Firm Shares and the Additional Shares are hereinafter collectively
referred to as the "SHARES." The common shares, $.01 par value per share, of the
Company generally are hereinafter referred to as the "COMMON STOCK." The use of
the neuter in this Agreement shall include the feminine and masculine wherever
appropriate. Any reference herein to the Registration Statement, the Basic
Prospectus, any Preliminary Prospectus or the Final Prospectus shall be deemed
to refer to and include the documents incorporated by reference therein pursuant
to Item 12 of Form S-3 which were filed under the Exchange Act on or before the
Effective Date of the Registration Statement or the issue date of the Basic
Prospectus, any Preliminary Prospectus or the Final Prospectus, as the case may
be; and any reference herein to the terms "amend," "amendment" or "supplement"
with respect to the Registration Statement, the Basic Prospectus, any
Preliminary Prospectus or the Final Prospectus shall be deemed to refer to and
include the filing of any document under the Exchange Act after the Effective
Date of the Registration Statement or the issue date of the Basic Prospectus,
any Preliminary Prospectus or the Final Prospectus, as the case may be, deemed
to be incorporated therein by reference. Certain terms used herein are defined
in Section 20 hereof.
1. Representations and Warranties of the Company. The Company
represents and warrants to and agrees with each of the Underwriters that:
(a) The Company meets the requirements for the use of Form S-3 under
the Securities Act and has prepared and filed with the Commission an
automatic shelf registration statement, as defined in Rule 405 on Form
S-3, including a related Basic Prospectus, for registration under the Act
of the offering
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and sale of the Shares. Such Registration Statement, including any
amendments thereto filed prior to the Execution Time, became effective
upon filing. The Company will file with the Commission a final prospectus
supplement relating to the Shares in accordance with Rule 424(b). As
filed, such final prospectus supplement shall contain all information
required by the Act and the rules thereunder, and, except to the extent
the Representative shall agree in writing to a modification, shall be in
all substantive respects in the form furnished to you prior to the
Execution Time or, to the extent not completed at the Execution Time,
shall contain only such specific additional information and other changes
(beyond that contained in the Basic Prospectus and any Preliminary
Prospectus) as the Company has advised you, prior to the Execution Time,
will be included or made therein. The Registration Statement, at the
Execution Time, meets the requirements set forth in Rule 415(a)(1)(x).
(b) On each Effective Date, the Registration Statement did, and when
the Final Prospectus is first filed in accordance with Rule 424(b) and on
the Closing Date (as defined herein) and on any date on which Additional
Shares are purchased, if such date is not the Closing Date (a "settlement
date"), the Final Prospectus (and any supplement thereto) will, comply in
all material respects with the applicable requirements of the Act and the
Exchange Act and the respective rules thereunder; on each Effective Date
and at the Execution Time, the Registration Statement did not and will not
contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary in order to make
the statements therein not misleading; and on the date of any filing
pursuant to Rule 424(b) and on the Closing Date and any settlement date,
the Final Prospectus (together with any supplement thereto) will not
include any untrue statement of a material fact or omit to state a
material fact necessary in order 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 the information contained in or omitted from the Registration
Statement or the Final Prospectus (or any supplement thereto) in reliance
upon and in conformity with information furnished in writing to the
Company by or on behalf of any Underwriter through the Representative
specifically for inclusion in the Registration Statement or the Final
Prospectus or as to the Selling Shareholder Information (or any supplement
thereto), it being understood and agreed that the only such information
furnished by or on behalf of any Underwriter consists of the information
described as such in Section 8 hereof.
(c) The Disclosure Package (as defined in Section 20 hereof) and the
price to the public, the number of Firm Shares and the number of
Additional Shares to be included on the cover page of the Final
Prospectus, when taken together as a whole, does not contain any untrue
statement of a material fact or omit to state any material fact necessary
in order to make the statements therein, in the light of the circumstances
under which they were made, not misleading. The preceding sentence does
not apply to statements in or omissions from the Disclosure Package
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regarding the Selling Shareholder Information or based upon and in
conformity with written information furnished to the Company by any
Underwriter through the Representative specifically for use therein, it
being understood and agreed that the only such information furnished by or
on behalf of any Underwriter consists of the information described as such
in Section 8 hereof.
(d) (i) At the time of filing the Registration Statement, (ii) at
the time of the most recent amendment thereto for the purposes of
complying with Section 10(a)(3) of the Securities Act (whether such
amendment was by post-effective amendment, incorporated report filed
pursuant to Sections 13 or 15(d) of the Exchange Act or form of
prospectus), (iii) at the time the Company or any person acting on its
behalf (within the meaning, for this clause only, of Rule 163(c)) made any
offer relating to the Shares in reliance on the exemption in Rule 163, and
(iv) at the Execution Time (with such date being used as the determination
date for purposes of this clause (iv)), the Company was or is (as the case
may be) a "well-known seasoned issuer" as defined in Rule 405. The Company
agrees to pay the fees required by the Commission relating to the Shares
within the time required by Rule 456(b)(1) without regard to the proviso
therein and otherwise in accordance with Rules 456(b) and 457(r) or Rule
457(p) (it being understood such fees are reimbursable by the Selling
Shareholder).
(e) (i) At the earliest time after the filing of the Registration
Statement that the Company or another offering participant made a bona
fide offer (within the meaning of Rule 164(h)(2)) of the Shares and (ii)
as of the Execution Time (with such date being used as the determination
date for purposes of this clause (ii), the Company was not and is not an
Ineligible Issuer (as defined in Rule 405), without taking account of any
determination by the Commission pursuant to Rule 405 that it is not
necessary that the Company be considered an Ineligible Issuer.
(f) The Company has been duly incorporated, is validly existing as
an exempted company in good standing under the laws of Bermuda, has the
corporate power and authority to own its property and to conduct its
business as described in the Disclosure Package and the Final Prospectus
and is duly qualified to transact business and is in good standing in each
jurisdiction in which the conduct of its business or its ownership or
leasing of property requires such qualification, except to the extent that
the failure to be so qualified or be in good standing would not have a
material adverse effect on the Company and the Subsidiaries (as defined
below), taken as a whole.
(g) IPCRe Limited (formerly International Property Catastrophe
Reinsurance Company, Ltd.), a Bermuda company ("IPCRE"), has been duly
incorporated, is validly existing as an exempted company in good standing
under the laws of Bermuda, has the corporate power and authority to own
its property and to conduct its business as described in the Disclosure
Package and the Final Prospectus and is duly qualified to transact
business and is in good standing in each
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jurisdiction in which the conduct of its business or its ownership or
leasing of property requires such qualification, except to the extent that
the failure to be so qualified or be in good standing would not have a
material adverse effect on the Company and the Subsidiaries, taken as a
whole; all of the issued shares of capital of IPCRe have been duly and
validly authorized and issued, are fully paid and non-assessable and are
owned directly by the Company, free and clear of all liens, encumbrances,
equities or claims.
(h) IPCRe Europe Limited, an Irish company ("IPCRE EUROPE" and,
together with IPCRe, the "DESIGNATED SUBSIDIARIES"), has been duly
incorporated, is validly existing as a company in good standing under the
laws of Ireland, has the corporate power and authority to own its property
and to conduct its business as described in the Disclosure Package and the
Final Prospectus and is duly qualified to transact business and is in good
standing in each jurisdiction in which the conduct of its business or its
ownership or leasing of property requires such qualification, except to
the extent that the failure to be so qualified or be in good standing
would not have a material adverse effect on the Company and the
Subsidiaries, taken as a whole; all of the issued shares of capital of
IPCRe Europe have been fully paid and non-assessable and are owned
directly by IPCRe, free and clear of all liens, encumbrances, equities or
claims.
(i) IPCRe Underwriting Services Limited, a Bermuda company ("IPCUSL"
and, together with IPCRe and IPCRe Europe, the "SUBSIDIARIES"), has been
duly incorporated, is validly existing as a company in good standing under
the laws of Bermuda, has the corporate power and authority to own its
property and to conduct its business as described in the Disclosure
Package and the Final Prospectus and is duly qualified to transact
business and is in good standing in each jurisdiction in which the conduct
of its business or its ownership or leasing of property requires such
qualification, except to the extent that the failure to be so qualified or
be in good standing would not have a material adverse effect on the
Company and the Subsidiaries, taken as a whole; all of the issued shares
of capital of IPCUSL have been duly and validly authorized and issued, are
fully paid and non-assessable and are owned directly by the Company, free
and clear of all liens, encumbrances, equities or claims.
(j) Except as described in the Disclosure Package and the Final
Prospectus, there are no material restrictions, whether direct or
indirect, under any provision of applicable law, under the memorandum of
association or bye-laws or other organizational document of any subsidiary
of the Company, under any agreement or other instrument binding upon the
Company or IPCRe or any of their properties, or under any judgment, order
or decree of any governmental body, agency or court having jurisdiction
over the Company or IPCRe, on the ability of any subsidiary of the
Company: (i) to pay any dividends to the Company; (ii) to make any other
distribution on such subsidiary's capital stock; (iii) to repay to the
Company any loans or advances to such subsidiary from the Company; or (iv)
to
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transfer any of such subsidiary's property or assets to the Company or any
other subsidiary of the Company.
(k) The Company and the Designated Subsidiaries do not own any real
property. Each of the Company and IPCRe has good and marketable title to
all personal property owned by them, in each case free and clear of all
liens, encumbrances and defects except such as are described in the
Disclosure Package and the Final Prospectus or such as do not materially
affect the value of such property and do not materially interfere with the
use made and proposed to be made of such property by the Company and
IPCRe; and any real property and buildings held under lease by the Company
and IPCRe are held by them under valid, subsisting and enforceable leases
with such exceptions as are not material and do not materially interfere
with the use made and proposed to be made of such property and buildings
by the Company and IPCRe.
(l) This Agreement has been duly authorized, executed and delivered
by the Company.
(m) Neither the Company nor IPCRe is in violation of its memorandum
of association or bye-laws or other organizational document or in default
in the performance or observance of any obligation, agreement, covenant or
condition contained in any material contract, lease or other agreement or
instrument to which it or either of them is a party or by which it or
either of them or their properties may be bound.
(n) The authorized capital of the Company conforms as to legal
matters to the description thereof contained in the Disclosure Package and
the Final Prospectus.
(o) The Shares have been duly authorized and are validly issued,
fully paid and non-assessable.
(p) The form of certificates for the Shares conforms to the
requirements of the laws of Bermuda and the Nasdaq Global Select Market;
and the Shares have been approved for quotation on the Nasdaq Global
Select Market.
(q) The consolidated financial statements of the Company and its
consolidated subsidiaries (together with related notes) included in the
Registration Statement, the Disclosure Package and Final Prospectus comply
as to form in all material respects with the requirements of the
Securities Act and the applicable rules and regulations of the Commission
thereunder and present fairly the financial position of the Company as at
the dates indicated and the results of its operations and the statements
of its cash flows for the periods specified; such financial statements
have been prepared in conformity with United States generally accepted
accounting principles applied on a consistent basis during the periods
involved, except as disclosed therein; and the supporting schedules
included in the Disclosure
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Package, the Final Prospectus and the Registration Statement present
fairly the information required to be stated therein. The consolidated
balance sheets of the Company and its subsidiaries as of December 31,
2005, 2004 and 2003 and the related consolidated statements of income and
comprehensive income, changes in shareholders' equity and cash flows for
the years ended December 31, 2005, 2004 and 2003 have been audited by
KPMG. The selected financial data set forth under the caption "Selected
Consolidated Financial Data" in the Disclosure Package, the Final
Prospectus and Registration Statement fairly present, on the basis stated
in the Disclosure Package, the Final Prospectus and the Registration
Statement, the information included therein. All statutory financial
statements of IPCRe where required to be prepared in accordance with the
insurance laws of Bermuda and the rules and regulations promulgated
thereunder, from which certain ratios and other statistical data contained
in the Disclosure Package, the Final Prospectus and the Registration
Statement have been derived, have for each relevant period been prepared
in conformity in all material respects with the requirements of such
insurance laws and such rules and regulations and present fairly the
information purported to be shown. Statutory financial statements of IPCRe
and IPCRe Europe are not required to be prepared pursuant to the insurance
laws of any jurisdiction other than Bermuda and Ireland, respectively.
(r) The execution and delivery by the Company of, and the
performance by the Company of its obligations under, this Agreement will
not contravene any provision of: (i) applicable law, (ii) the memorandum
of association or bye-laws of the Company or either of the Designated
Subsidiaries, (iii) any agreement or other instrument binding upon the
Company or IPCRe except to the extent such contravention would not have a
material adverse effect on (a) the Company and the Subsidiaries, taken as
a whole or (b) the Company's ability to consummate the transactions
contemplated by this Agreement, or (iv) any judgment, order or decree of
any governmental body, agency or court having jurisdiction over the
Company or IPCRe, except to the extent such contravention would not have a
material adverse effect on (a) the Company and the Subsidiaries, taken as
a whole or (b) the Company's ability to consummate the transactions
contemplated by this Agreement; and no consent, approval, authorization or
order of, or qualification with, any governmental body or agency is
required for the performance by the Company of obligations under this
Agreement, except registrations and filings under the Securities Act (as
mentioned in Section 1(a)) and under the Exchange Act, and such as may be
required by the securities or Blue Sky or insurance securities laws of the
various states in connection with the offer and sale of the Shares, as may
be required in such jurisdictions outside the U.S. where the Underwriters
choose to market the Shares and such as may be required and have been
obtained from the Bermuda Monetary Authority.
(s) There has not occurred any material adverse change, or any
development involving a prospective material adverse change, in the
condition, financial or otherwise, or in the earnings, business or
operations of the Company
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and the Subsidiaries, taken as a whole, from that set forth in the
Disclosure Package and Final Prospectus (exclusive of any amendments or
supplements thereto subsequent to the date of this Agreement). Subsequent
to the respective dates as of which information is given in the Disclosure
Package, the Final Prospectus and the Registration Statement: (i) neither
the Company nor IPCRe has incurred any material loss or interference with
its own business operations (excluding losses suffered by cedents covered
by reinsurance policies of IPCRe) from fire, explosion, flood or other
calamity, whether or not covered by insurance, or from any labor dispute
or court or governmental action, order or decree, or any other liability
or obligation, direct or contingent, that is material to the Company and
the Subsidiaries, taken as a whole; and (ii) there has not been any
material change in the capital, shareholders' equity, statutory surplus or
reserves (including any such change in the loss and loss adjustment
expense reserves) of the Company or IPCRe.
(t) No relationship, direct or indirect, or agreement, arrangement
or understanding (including, without limitation, any voting agreement),
exists between or among the Company or either of the Designated
Subsidiaries and any other party, which is required by the Securities Act
to be described in the Disclosure Package, the Final Prospectus or the
Registration Statement or to be filed as an exhibit to the Registration
Statement which is not described or filed as required.
(u) There are no legal or governmental proceedings pending or, to
the Company's knowledge, threatened to which the Company or either of the
Designated Subsidiaries is a party or to which any of the properties of
the Company or either of the Designated Subsidiaries is subject that are
required to be described in the Disclosure Package, the Final Prospectus
or the Registration Statement and are not so described or any statutes,
regulations, contracts or other documents that are required to be
described in the Disclosure Package, the Final Prospectus or the
Registration Statement or to be filed as exhibits to the Registration
Statement that are not described or filed as required.
(v) No action, suit or proceeding by or before any court or
governmental agency, authority or body or any arbitrator of competent
jurisdiction involving the Company or its Designated Subsidiaries or to
the knowledge of the Company, or its or their property is pending or, to
the knowledge of the Company, threatened that (i) would reasonably be
expected to have a material adverse effect on the Company's ability to
consummate the transactions contemplated by this Agreement or (ii) would
reasonably be expected to have a material adverse effect on the condition
(financial or otherwise), earnings, business or properties of the Company
and its Subsidiaries, taken as a whole, except as set forth in or
contemplated in the Final Prospectus and the Disclosure Package (exclusive
of any amendments or supplements thereto subsequent to the date of this
Agreement).
(w) Each preliminary prospectus filed as part of the registration
statement as originally filed or as part of any amendment thereto, or
filed pursuant
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to Rule 424 under the Securities Act, complied when so filed in all
material respects with the Securities Act and the applicable rules and
regulations of the Commission thereunder.
(x) IPCRe is duly registered by the Bermuda Minister of Finance as a
Class 4 insurer under the Bermuda Insurance Act 1978, as amended, and any
applicable rules and regulations thereunder. IPCRe is not required to be
licensed or admitted as an insurer in, or otherwise to comply with the
insurance laws (including laws that relate to companies that control
insurance companies) and the rules, regulations and interpretations of the
insurance regulatory authorities thereunder (collectively, "INSURANCE
LAWS") of, any jurisdiction other than Bermuda in order to conduct its
business as described in the Disclosure Package and the Final Prospectus.
IPCRe Europe operates as a reinsurer under the laws of Ireland and is not
required to be licensed under such laws. IPCUSL is registered in Bermuda
and licensed as an insurance agent.
(y) The Company and IPCRe possess all consents, authorizations,
approvals, orders, licenses, certificates, or permits issued by any
regulatory agencies or bodies (collectively, "PERMITS") which are
necessary to conduct the business now operated by them as described in the
Disclosure Package and the Final Prospectus, except where the failure to
possess such Permits would not have a material adverse effect on the
Company and the Subsidiaries, taken as a whole; all of such Permits are in
full force and effect, except where the failure to be in full force and
effect would not have a material adverse effect on the Company and the
Subsidiaries, taken as a whole; there is no pending or, to the knowledge
of the Company, contemplated or threatened action, suit, proceeding,
investigation or event against or involving the Company or IPCRe (and the
Company knows of no reasonable basis for any such action, suit,
proceeding, investigation or event) that could lead to the revocation,
modification, termination, suspension or any other material impairment of
the rights of the holder of any such Permit which, individually or in the
aggregate, if the subject of an unfavorable decision, ruling or finding,
would materially and adversely affect the condition, financial or
otherwise, or the earnings, business or operations of the Company and the
Subsidiaries, taken as a whole; neither the Company nor IPCRe has received
any notification from any insurance authority, commission or other
insurance regulatory body to the effect that any additional Permit from
such authority, commission or body is needed to be obtained by the Company
or IPCRe or that the Company or IPCRe is not in compliance with any
applicable Insurance Laws; and no insurance regulatory agency or body has
issued any order or decree impairing, restricting or prohibiting the
payment of any dividends by the Company or IPCRe or the continuation of
the business of the Company or IPCRe as currently conducted.
(z) Each of the Company and IPCRe has filed all reports, information
statements and other documents as required to be filed pursuant to Bermuda
law, and has duly paid all taxes (including franchise taxes and similar
fees) it is required
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to have paid under Bermuda law, except where the failure to file such
statements or reports or pay such taxes would not have a material adverse
effect on the condition, financial or otherwise, or on the earnings,
business or operations of the Company and the Subsidiaries, taken as a
whole; and each of the Company and IPCRe maintains its books and records
in accordance with the Bermuda Insurance Act (as defined below), except
where the failure to so maintain its books and records would not have a
material adverse effect on the condition, financial or otherwise, or on
the earnings, business or operations of the Company and the Subsidiaries,
taken as a whole.
(aa) IPCRe is in compliance with the applicable requirements of the
Bermuda Insurance Act 1978, as amended, and any applicable rules and
regulations thereunder (collectively, the "BERMUDA INSURANCE ACT"), except
where the failure to comply would not have a material adverse effect on
the Company and the Subsidiaries, taken as a whole; and, subject to the
disclosures in the Disclosure Package and the Final Prospectus, each of
the Company and IPCRe is in compliance with the insurance laws and
regulations of other jurisdictions which are applicable to the Company or
IPCRe, as the case may be, except where the failure to comply would not
have a material adverse effect on the Company and the Subsidiaries, taken
as a whole.
(bb) All liability, casualty, directors and officers liability,
surety bonds and other similar insurance contracts that insure the
business, properties, operations or affairs of the Company and IPCRe or
affect or relate to the ownership, use or operations of the Company's or
IPCRe's assets or properties are in full force and effect and, to the
knowledge of the Company and IPCRe, are with financially sound and
reputable insurers and in accordance with normal industry practice.
(cc) Neither the Underwriters nor any subsequent purchasers of the
Shares is subject to any stamp duty, excise or similar tax imposed in
Bermuda in connection with the offering, sale or purchase of the Shares.
(dd) Any tax returns required to be filed by the Company or IPCRe in
any jurisdiction have been filed, and any material taxes, including any
withholding taxes, penalties and interest, assessments and fees and other
charges due or claimed to be due from such entities have been paid, other
than any of those being contested in good faith and for which adequate
reserves have been provided or any of those currently payable without
penalty or interest.
(ee) The Company and IPCRe have received from the Bermuda Minister
of Finance an assurance under The Exempted Undertakings Tax Protection
Act, 1966 of Bermuda as described in the Prospectus under the caption
"Bermuda Taxation," and neither the Company nor IPCRe has received any
notification to the effect (or is otherwise aware) that such assurance may
be revoked or otherwise not honored by the Bermuda government.
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(ff) There are no currency exchange control laws or withholding
taxes, in each case of Bermuda, that would be applicable to the payment of
dividends: (i) on the Shares by the Company (other than to residents of
Bermuda for Bermuda exchange control purposes); or (ii) by IPCRe to the
Company.
(gg) Neither the Company nor either of the Designated Subsidiaries
has taken or will take, directly or indirectly, any action designed to, or
that might reasonably be expected to, cause or result in the stabilization
or manipulation of the price of any security of the Company to facilitate
the sale or resale of the Shares pursuant to the distribution contemplated
by this Agreement, and other than as permitted by the Securities Act or
the applicable rules and regulations of the Commission thereunder, the
Company and the Designated Subsidiaries have not distributed and will not
distribute, prior to the later to occur of: (i) the Closing Date or the
Option Closing Date (as described below); and (ii) completion of the
distribution of the Shares, any prospectus or other offering material in
connection with the offering and sale of the Shares.
(hh) KPMG, who certified the financial statements and supporting
schedules included in the Registration Statement, Disclosure Package and
Final Prospectus, is the independent registered public accounting firm
with respect to the Company as required by the Securities Act.
(ii) The Company and IPCRe maintain "disclosure controls and
procedures" (as defined in Rule 13a-15(e) under the Exchange Act) and
maintain a system of internal accounting controls sufficient to provide
reasonable assurances that: (i) transactions are executed in all material
respects in accordance with management's general or specific
authorization; (ii) transactions are recorded as necessary to permit
preparation of financial statements in conformity with United States
generally accepted accounting principles and with statutory accounting
principles, as the case may be, 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.
(jj) The Company is not required to register as an "investment
company" as such term is defined in the Investment Company Act of 1940, as
amended.
(kk) The Company and IPCRe (i) are in compliance with any and all
applicable foreign, federal, state and local laws and regulations relating
to the protection of human health and safety, the environment or hazardous
or toxic substances or wastes, pollutants or contaminants ("ENVIRONMENTAL
LAWS"), (ii) have received all permits, licenses or other approvals
required of them under applicable Environmental Laws to conduct their
respective businesses and (iii) are
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in compliance with all terms and conditions of any such permit, license or
approval, except where such noncompliance with Environmental Laws, failure
to receive required permits, licenses or other approvals or failure to
comply with the terms and conditions of such permits, licenses or
approvals would not have a material adverse effect on the Company and the
Subsidiaries, taken as a whole.
(ll) Other than the arrangements with the Selling Shareholder
described in the Disclosure Package and the Final Prospectus, there are no
contracts, agreements or understandings between the Company and any person
granting such person the right to require the Company to file a
registration statement under the Securities Act with respect to any
securities of the Company or to require the Company to include such
securities with the Shares registered pursuant to the Registration
Statement.
(mm) The Company and IPCRe have not taken, directly or indirectly,
any action designed to or that would be reasonably expected to cause or
result in the Company and/or IPCRe being treated as: (i) engaged in a
trade or business within the United States for purposes of the Internal
Revenue Code of 1986, as amended (the "CODE"); or (ii) a Passive Foreign
Investment Company within the meaning of Section 1297 of the Code. The
Company, to its knowledge, is not a Passive Foreign Investment Company
within the meaning of Section 1297 of the Code.
(nn) The Shares have previously been approved for quotation on the
Nasdaq Global Select Market and the Company is not aware of any reason why
the Shares would no longer be so approved due to the sale of the Shares by
the Selling Shareholder.
2. Representations and Warranties of the Selling Shareholder. The
Selling Shareholder represents and warrants to, and agrees with, each
Underwriter that:
(a) Such Selling Shareholder is the record and beneficial owner of
the Shares to be sold by it hereunder free and clear of all liens,
encumbrances, equities and claims and has duly endorsed such Shares in
blank, and has full power and authority to sell its interest in the
Shares, and, assuming that each Underwriter acquires its interest in the
Shares it has purchased from such Selling Shareholder without notice of
any adverse claim (within the meaning of Section 8-105 of the New York
Uniform Commercial Code ("UCC")), each Underwriter that has purchased such
Shares delivered on the Closing Date to The Depository Trust Company or
other securities intermediary by making payment therefor as provided
herein, and that has had such Shares credited to the securities account or
accounts of such Underwriters maintained with The Depository Trust Company
or such other securities intermediary will have acquired a security
entitlement (within
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the meaning of Section 8-102(a)(17) of the UCC) to such Shares purchased
by such Underwriter, and no action based on an adverse claim (within the
meaning of Section 8-105 of the UCC) may be asserted against such
Underwriter with respect to such Shares.
(b) Such Selling Shareholder has not taken, directly or indirectly,
any action designed to or that would constitute or that might reasonably
be expected to cause or result in, under the Exchange Act or otherwise,
stabilization or manipulation of the price of any security of the Company
to facilitate the sale or resale of the Shares.
(c) No consent, approval, authorization or order of any court or
governmental agency or body is required for the consummation by such
Selling Shareholder of the transactions contemplated herein, except such
as may have been obtained under the Act and such as may be required under
the blue sky laws of any jurisdiction in connection with the purchase and
distribution of the Shares by the Underwriters and such other approvals as
have been obtained.
(d) Neither the sale of the Shares being sold by such Selling
Shareholder nor the consummation of any other of the transactions herein
contemplated by such Selling Shareholder or the fulfillment of the terms
hereof by such Selling Shareholder will conflict with, result in a breach
or violation of, or constitute a default under (i) any law, (ii) the
charter or by-laws of such Selling Shareholder, (iii) the terms of any
indenture or other agreement or instrument to which such Selling
Shareholder or any of its subsidiaries is a party or bound, or (iv) any
judgment, order or decree applicable to such Selling Shareholder or any of
its subsidiaries of any court, regulatory body, administrative agency,
governmental body or arbitrator having jurisdiction over such Selling
Shareholder or any of its subsidiaries, in the case of clauses (i), (iii)
or (iv), as would materially impair the ability of the Selling Shareholder
to perform its obligations under this Agreement.
(e) The Selling Shareholder, the Company and the Underwriters
acknowledge that the Selling Shareholder Information with respect to the
Selling Shareholder constitutes the only information furnished in writing
by the Selling Shareholder for inclusion in the Preliminary Prospectus,
the Final Prospectus or any Issuer Free Writing Prospectus and any
supplements.
(f) In respect of any statements in or omissions from the
Registration Statement, the Final Prospectus, any Preliminary Prospectus
or any Free Writing Prospectus or any amendment or supplement thereto used
by the Company or any Underwriter, as the case may be, made in reliance
upon and in conformity with the Selling Shareholder Information furnished
in writing to the Company or to the Underwriters by the Selling
Shareholder specifically for use in connection with the preparation
thereof, Selling Shareholder hereby makes the same representations and
warranties to each Underwriter as the Company makes to such Underwriter
under paragraphs (b) or (c) of Section 1.
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Any certificate signed by any officer of any Selling Shareholder and delivered
to the Representative or counsel for the Underwriters in connection with the
offering of the Shares shall be deemed a representation and warranty by such
Selling Shareholder, as to matters covered thereby, to each Underwriter.
3. Agreements to Sell and Purchase. (a) The Selling Shareholder
hereby agrees to sell to the several Underwriters, and each Underwriter, upon
the basis of the representations and warranties herein contained, but subject to
the conditions hereinafter stated, agrees, severally and not jointly, to
purchase from the Selling Shareholder the respective numbers of Firm Shares set
forth in Schedule I hereto opposite its name at $26.055 a share (the "PURCHASE
PRICE").
(b) On the basis of the representations and warranties contained in
this Agreement, and subject to its terms and conditions, the Selling Shareholder
agrees to sell to the Underwriters the Additional Shares, and the Underwriters
shall have a one-time right to purchase, severally and not jointly, up to
2,000,0000 Additional Shares at the Purchase Price. If you, on behalf of the
Underwriters, elect to exercise such option, you shall so notify the Company and
the Seller Shareholder in writing not later than 30 days after the date of this
Agreement, which notice shall specify the number of Additional Shares to be
purchased by the Underwriters and the date on which such shares are to be
purchased. Such date may be the same as the Closing Date (as defined below) but
not earlier than the Closing Date nor later than ten business days after the
date of such notice. Additional Shares may be purchased as provided in Section 5
hereof solely for the purpose of covering over-allotments made in connection
with the offering of the Firm Shares. If any Additional Shares are to be
purchased, each Underwriter agrees, severally and not jointly, to purchase the
number of Additional Shares (subject to such adjustments to eliminate fractional
shares as you may determine) that bears the same proportion to the total number
of Additional Shares to be purchased as the number of Firm Shares set forth in
Schedule I hereto opposite the name of such Underwriter bears to the total
number of Firm Shares.
(c) The Company hereby agrees that, without the prior written
consent of the Representative on behalf of the Underwriters, it will not, during
the period ending 60 days after the date of the Final Prospectus: (i) offer,
pledge, sell, contract to sell, sell any option or contract to purchase,
purchase any option or contract to sell, grant any option, right or warrant to
purchase, lend, or otherwise transfer or dispose of, directly or indirectly, any
shares of Common Stock or any securities convertible into or exercisable or
exchangeable for Common Stock; or (ii) enter into any swap or other arrangement
that transfers to another, in whole or in part, any of the economic consequences
of ownership of the Common Stock, whether any such transaction described in
clause (i) or (ii) above is to be settled by delivery of Common Stock or such
other securities, in cash or otherwise or (iii) file any new registration
statement with the Commission relating to the offering of any shares of Common
Stock or any securities convertible into or exerciseable for Common Stock (it
being understood that a registration statement is already on file therefor). The
foregoing sentence shall not apply to (A) the sale of the Shares hereunder,
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or (B) the issuance by the Company of shares of Common Stock upon the exercise
of an option outstanding under the Company's existing stock option plan, the
vesting of any restricted stock unit outstanding under the Company's existing
stock incentive plan or the issuance of new options or restricted stock units
thereunder or any warrant or the conversion of a security outstanding on the
date hereof of which the Underwriters have been advised in writing prior to the
date hereof; provided however that the Company shall not be permitted to convert
any Series A 7.25% Mandatory Convertible Preferred Shares except with respect to
requests to convert such shares by holders thereof.
4. Terms of Public Offering. The Selling Shareholder and the Company
are advised by you that the Underwriters propose to make a public offering of
their respective portions of the Shares as soon after this Agreement has become
effective as in your judgment is advisable. The Selling Shareholder and the
Company are further advised by you that the Shares are to be offered to the
public initially at $27.00 a share (the "PUBLIC OFFERING PRICE") and to certain
dealers selected by you at a price that represents a concession not in excess of
$0.5670 a share under the Public Offering Price.
5. Payment and Delivery. (a) Payment for the Firm Shares shall be
made to the Selling Shareholder in Federal or other funds immediately available
in New York City against delivery of such Firm Shares for the respective
accounts of the several Underwriters at 10:00 a.m., New York City time, on
August 15, 2006 or at such other time on the same or such other date, as the
Representative shall designate in their sole discretion in writing. The time and
date of such payment are hereinafter referred to as the "CLOSING DATE."
(b) Payment for any Additional Shares shall be made to the Selling
Shareholder in Federal or other funds immediately available in New York City
against delivery of such Additional Shares for the respective accounts of the
several Underwriters at 10:00 a.m., New York City time, on the date specified in
the notice described in Section 3 or at such other time on the same or on such
other date, as the Representative shall designate in its sole discretion in
writing. The time and date of such payment are hereinafter referred to as the
"OPTION CLOSING DATE".
(c) Certificates for the Firm Shares and Additional Shares shall be
in definitive form and registered in such names and in such denominations as you
shall request in writing not later than one full business day prior to the
Closing Date or the Option Closing Date, as the case may be. The certificates
evidencing the Firm Shares and Additional Shares shall be delivered to you on
the Closing Date or the Option Closing Date, as the case may be, for the
accounts directed by you, as Representative of the several Underwriters, with
any transfer taxes payable in connection with the transfer of the Shares to the
Underwriters duly paid, against payment of the Purchase Price therefor.
6. Conditions to the Underwriters' Obligations. The several
obligations of the Underwriters to purchase and pay for the Shares on the
Closing Date
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are subject, in the discretion of the Underwriters, to the condition that all
representations and warranties and other statements of the Company and the
Selling Shareholder in this Agreement are, at and as of the date of this
Agreement and the Closing Date, true and correct, the condition that the Company
and the Selling Shareholder shall have performed all of their respective
obligations hereunder theretofore to be performed, and to the following
conditions:
(a) The Final Prospectus as amended or supplemented in relation to
the Shares shall have been filed with the Commission pursuant to Rule
424(b) within the applicable time period prescribed for such filing by the
rules and regulations under the Securities Act and in accordance with
Section 7(i)(a) hereof; no stop order suspending the effectiveness of the
Registration Statement shall have been issued or shall be pending or, to
the knowledge of the Company, shall be threatened by the Commission, and
any request on the part of the Commission for additional information shall
have been complied with to the reasonable satisfaction of the Underwriter.
(b) Subsequent to the execution and delivery of this Agreement and
prior to the Closing Date:
(i) there shall not have occurred any downgrading, nor shall
any notice have been given of any intended or potential downgrading
or of any review for a possible change that does not indicate the
direction of the possible change, in the rating accorded to the
Company or any of its Designated Subsidiaries or any of their
securities by any "nationally recognized statistical rating
organization," as such term is defined for purposes of Rule
436(g)(2) under the Securities Act; and
(ii) there shall not have occurred any change, or any
development involving a prospective change, in the condition,
financial or otherwise, or in the earnings, business or operations
of the Company and the Subsidiaries, taken as a whole, from that set
forth in the Disclosure Package and the Final Prospectus (exclusive
of any amendments or supplements thereto subsequent to the date of
this Agreement) that, in your judgment, is material and adverse and
that makes it, in your judgment, impracticable to market the Shares
on the terms and in the manner contemplated in the Disclosure
Package and the Final Prospectus.
(c) The Underwriters shall have received on the Closing Date a
certificate, dated the Closing Date and signed by an executive officer of
the Company, to the effect set forth in Section 6(a) and 6(b) above and to
the effect that: (i) the representations and warranties of the Company
contained in this Agreement are true and correct as of the Closing Date;
and (ii) the Company has complied with all of the agreements and satisfied
all of the conditions on its part to be performed or satisfied hereunder
on or before the Closing Date.
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(d) The Underwriters shall have received on the Closing Date a
certificate, signed by an executive officer of the Selling Shareholder, to
the effect that the signer of such certificate has carefully examined the
Registration Statement, the Final Prospectus, any Issuer Free Writing
Prospectus and any supplements or amendments thereto and this Agreement,
and that the representations and warranties of the Selling Shareholder
contained in Section 2 of this Agreement are true and correct as of the
Closing Date.
(e) The Underwriters shall have received on the Closing Date an
opinion (which opinion may be rendered in reliance upon the appropriate
opinions of Xxxxxxx Xxxx & Xxxxxxx as to Bermuda law) of Xxxxxxxx &
Xxxxxxxx LLP, U.S. counsel to the Company, dated the Closing Date, to the
effect that:
(i) this Agreement has been duly authorized, executed and
delivered by the Company
(ii) the execution and delivery by the Company of, and the
performance by the Company of its obligations under, this Agreement
will not violate any provision of (A) United States Federal or New
York law (provided, however, that such counsel need express no
opinion with respect to United States Federal or state securities
laws, antifraud laws and fraudulent transfer laws), (B) to such
counsel's knowledge, any agreement or other instrument binding upon
the Company or IPCRe that is material to the Company and the
Subsidiaries, taken as a whole, or (C) to such counsel's knowledge,
any judgment, order or decree of any governmental body, agency or
court having jurisdiction over the Company or IPCRe; and no consent,
approval, authorization or order of, or qualification with, any
United States Federal or New York governmental body or agency is
required for the performance by the Company of its obligations under
this Agreement, except such as may be required by the Securities
Act, the Exchange Act and the securities or Blue Sky or insurance
securities laws of New York;
(iii) the Registration Statement has become effective under
the Securities Act; any required filing of the Basic Prospectus, any
Preliminary Prospectus and the Final Prospectus, and any supplements
thereto, pursuant to Rule 424(b) has been made in the manner and
within the time period required by Rule 424(b); to the knowledge of
such counsel, no stop order suspending the effectiveness of the
Registration Statement or any notice that would prevent its use has
been issued, no proceedings for that purpose have been instituted or
threatened;
(iv) to such counsel's knowledge, such counsel does not know
of any legal or governmental proceedings pending or threatened to
which the Company or IPCRe is a party or to which any of the
properties of the
-16-
Company or IPCRe is subject that are required to be described in the
Disclosure Package, the Final Prospectus or the Registration
Statement and are not so described or of contracts or other
documents that are required to be described in the Disclosure
Package, the Final Prospectus or the Registration Statement or to be
filed as exhibits to the Registration Statement that are not
described or filed or incorporated by reference as required;
(v) to such counsel's knowledge, neither the Company nor IPCRe
has received any notification from any insurance authority,
commission or other insurance regulatory body to the effect that any
license from such authority, commission or body is needed to be
obtained by the Company or IPCRe or that the Company or IPCRe is not
in compliance with any applicable Insurance Laws;
(vi) the discussion of United States tax matters set forth
under the headings "U.S. Federal Tax Considerations" and "Certain
United States Federal Tax Considerations for Holders of Common
Shares" in the Disclosure Package and Final Prospectus together
fairly and accurately reflects such counsel's opinion as to such tax
laws (subject to the qualifications and assumptions set forth in
such discussion);
(vii) under the laws of the State of New York relating to
submission to jurisdiction, the Company has validly submitted to the
non-exclusive jurisdiction of any United States Federal or state
court in the Borough of Manhattan, the City of New York, State of
New York (a "NEW YORK COURT"), has validly waived any objection to
the venue of a proceeding in any such New York Court and has validly
appointed CT Corporation System, as its authorized agent, for the
purpose and to the extent described in Section 12 of this Agreement
and assuming: (A) the validity of such actions under Bermuda law;
and (B) the due authorization, execution and delivery of this
Agreement by or on behalf of the Underwriters; and (C) that the
Registration Statement and the Final Prospectus do not contain any
material misstatements or omissions;
(viii) the Company is not an "investment company" within the
meaning of the Investment Company Act of 1940, as amended;
(ix) such counsel: (A) is of the opinion that the Registration
Statement and Final Prospectus (except for financial statements and
schedules and other financial and statistical data included or
incorporated by reference therein as to which such counsel need not
express any opinion) comply as to form in all material respects with
the Securities Act and the applicable rules and regulations of the
Commission thereunder; (B) has no reason to believe that (except for
financial statements and
-17-
schedules and other financial and statistical data as to which such
counsel need not express any belief) on each Effective Date the
Registration Statement contained any untrue statement of a material
fact or omitted to state a material fact required to be stated
therein or necessary to make the statements therein not misleading;
(C) has no reason to believe that (except for financial statements
and schedules and other financial and statistical data as to which
such counsel need not express any belief) the Final Prospectus as of
the date hereof and as of the Closing Date contained any untrue
statement of a material fact or omitted to state a 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; and (D) has no reason to believe that (except
for financial statements and schedules and other financial and
statistical data as to which such counsel need not express any
belief) the Disclosure Package as of the date of the Execution Time
contained any untrue statement of a material fact or omitted to
state a 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;
(x) the statements in the Disclosure Package and the Final
Prospectus under the caption "Certain Relationships And Related
Transactions" insofar as such statements constitute summaries of the
legal matters, documents or proceedings referred to therein, fairly
present the information called for with respect to such legal
matters, documents and proceedings and fairly summarize the matters
referred to therein; and the statements in the Disclosure Package
and Final Prospectus under the captions "Plan of Distribution" and
"Underwriting" insofar as such statements constitute a summary of
this Agreement fairly present the information called for with
respect to such document and fairly summarize the documents referred
to therein.
(xi) the documents incorporated by reference in the Disclosure
Package and the Final Prospectus pursuant to Item 12 of Form S-3
under the Securities Act (other than the financial statements,
supporting schedules and other financial information included or
incorporated by reference therein, as to which no opinion need to be
rendered), at the time they were filed (or at the time they were
amended, if applicable) with the Commission complied as to form in
all material respects with the requirements of the Exchange Act and
the rules and regulations thereunder; and
(xii) the sale of the Shares, the execution, delivery and
performance of this Agreement and the consummation of the
transactions contemplated herein will not conflict with or
constitute a breach of, or default under, the Amended and Restated
Administrative Services
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Agreement, the Investment Management Agreement, the Investment
Sub-Advisory Agreement and the Custodial Agreement, all as described
in the Prospectus.
(f) The Underwriters shall have received on the Closing Date an
opinion (which opinion may be rendered in reliance on the appropriate
opinions of Xxxxxxxx & Xxxxxxxx LLP as to New York law) of Xxxxxxx Xxxx &
Xxxxxxx, special Bermuda counsel to the Company, dated the Closing Date,
to the effect that:
(i) each of the Company, IPCRe and IPCUSL has been duly
incorporated and is validly existing under the laws of Bermuda in
good standing (meaning solely that each company has not failed to
make any filing with any Bermuda governmental authority or to pay
any Bermuda government fee or tax which would make it liable to be
struck off the Register of Companies and thereby cease to exist
under the laws of Bermuda);
(ii) the Company has the necessary corporate power and
authority to execute, deliver and perform its obligations under this
Agreement and the necessary corporate power to own its property and
conduct its business as described under the caption "Business" in
the Company's annual report on Form 10-K for the fiscal year ended
December 31, 2005. The execution and delivery of this Agreement by
the Company and the performance by the Company of its obligations
thereunder will not violate the memorandum of association or
bye-laws of the Company nor any applicable law, regulation, order or
decree in Bermuda;
(iii) each of the Company, IPCRe and IPCUSL has obtained all
necessary licenses, authorizations and permits from any government
or public body or authority of Bermuda or any sub-division thereof
to conduct its business as described under the caption "Business" in
the Company's annual report on Form 10-K for the fiscal year ended
December 31, 2005;
(iv) each of IPCRe and IPCUSL has the necessary corporate
power to own its property and conduct its business as described
under the caption "Business" in the Company's annual report on Form
10-K for the fiscal year ended December 31, 2005;
(v) the Company has taken all corporate action required to
authorize its execution, delivery and performance of this Agreement.
This Agreement has been duly executed and delivered by or on behalf
of the Company, and constitutes the valid and binding obligations of
the Company, enforceable against the Company in accordance with the
terms thereof;
-19-
(vi) the authorized capital of the Company conforms, as to
matters of Bermuda law, to the description thereof contained in the
Registration Statement, the Disclosure Package and the Final
Prospectus in all material respects;
(vii) based solely upon a review of a copy of the register of
members of the Company certified by the Secretary of the Company on
August 15, 2006, the issued share capital of the Company (including
the Shares to be sold by the Selling Shareholder) consists of
63,610,492 common shares, each of which is validly issued, fully
paid and non-assessable. The issuance of the Shares by the Company
to the Selling Shareholder has been validly authorized by the
Company;
(viii) based solely upon a review of a copy of the register of
members of IPCRe certified by the Secretary of IPCRe on August 15,
2006, the issued share capital (including the Shares to be sold by
the Selling Shareholder) of IPCRe consists of 1,250 common shares,
par value $200 per share, registered in the name of the Company,
each of which is validly issued, fully paid and non-assessable;
(ix) based solely upon a review of a copy of the register of
members of IPCUSL certified by the Secretary of IPCUSL on August 15,
2006, the issued share capital of IPCUSL consists of 12,000 common
shares, par value $1.00 per share, registered in the name of the
Company, each of which is validly issued, fully paid and
non-assessable;
(x) no order, consent, approval, license, authorization or
validation of, filing with or exemption by any government or public
body or authority of Bermuda or any sub-division thereof is required
to authorize or is required in connection with the execution,
delivery, performance and enforcement of this Agreement, except such
as have been duly obtained or filed in accordance with Bermuda law;
(xi) it is not necessary or desirable to ensure the
enforceability in Bermuda of this Agreement that it be registered in
any register kept by, or filed with, any governmental authority or
regulatory body in Bermuda. However, to the extent that this
Agreement creates a charge over assets of the Company or IPCRe, it
may be desirable to ensure the priority in Bermuda of the charge
that it be registered in the Register of Charges in accordance with
Section 55 of the Companies Act 1981. On registration, to the extent
that Bermuda law governs the priority of a charge, such charge will
have priority in Bermuda over any unregistered charges, and over any
subsequently registered charges, in respect of the assets which are
the subject of the charge. A registration fee of $515 will be
payable in respect of the registration. While there is no exhaustive
definition of a
-20-
charge includes any interest created in property by way of security
(including any mortgage, assignment, pledge, lien or hypothecation).
As this Agreement is governed by New York law, the question of
whether it creates such an interest in property would be determined
under New York law;
(xii) based solely upon a review of a copy of its certificate
of registration issued pursuant to the Bermuda Insurance Act, IPCRe
is duly registered in Bermuda as a class 4 insurer in accordance
with the provisions of the Insurance Act;
(xiii) the statements in the Disclosure Package and the Final
Prospectus under the captions "Dividends", "Description of Common
Shares and Preferred Shares We May Offer", "Bermuda Taxation" and
"Enforceability of Civil Liabilities Under The United States Federal
Securities Laws", "Risk Factors", "Certain United States Federal Tax
Considerations for Holders of Common Shares" and in the Company's
annual report on Form 10-K for the fiscal year ended December 31,
2005 under the caption "Bermuda - The Insurance Act of 1978, as
amended, and Related Regulations (the "INSURANCE ACT")" insofar as
they purport to describe the provisions of the laws of Bermuda
referred to therein, are correct in all material respects;
(xiv) there is no income or other tax of Bermuda imposed by
withholding or otherwise on any payment to be made to or by the
Company pursuant to this Agreement. This Agreement will not be
subject to ad valorem stamp duty in Bermuda and no registration,
documentary, recording, transfer or other similar tax, fee or charge
is payable in Bermuda in connection with the execution, delivery,
filing, registration or performance of this Agreement other than as
stated in paragraph (xiii) hereof;
(xv) the Company and IPCRe have each received from the Bermuda
Minister of Finance an assurance under The Exempted Undertakings Tax
Protection Act, 1966 as described in the Disclosure Package and the
Final Prospectus under the caption "Bermuda Taxation";
(xvi) there is no income or other tax of Bermuda imposed by
withholding or otherwise on any dividend or distribution to be made
(i) by the Company to the holders of the Shares; or (ii) by IPCRe or
IPCUSL to the Company. The Company has been designated as
non-resident of Bermuda for the purposes of the Exchange Control
Act, 1972 and, as such, is free to acquire, hold and sell foreign
currency and securities without restriction;
-21-
(xvii) the choice of New York law as the governing law of this
Agreement is a valid choice of law and would be recognized and given
effect to in any action brought before a court of competent
jurisdiction in Bermuda, except for those laws (i) which such court
considers to be procedural in nature, (ii) which are revenue or
penal laws or (iii) the application of which would be inconsistent
with public policy, as such term is interpreted under the laws of
Bermuda. The submission in this Agreement to the non-exclusive
jurisdiction of any New York Court is valid and binding upon the
Company;
(xviii) the courts of Bermuda would recognize as a valid
judgment, a final and conclusive judgment in personam obtained in a
New York Court against the Company based upon this Agreement under
which a sum of money is payable (other than a sum of money payable
in respect of multiple damages, taxes or other charges of a like
nature or in respect of a fine or other penalty) and would give a
judgment based thereon provided that (a) such courts had proper
jurisdiction over the parties subject to such judgment, (b) such
courts did not contravene the rules of natural justice of Bermuda,
(c) such judgment was not obtained by fraud, (d) the enforcement of
the judgment would not be contrary to the public policy of Bermuda,
(e) no new admissible evidence relevant to the action is submitted
prior to the rendering of the judgment by the courts of Bermuda and
(f) there is due compliance with the correct procedures under the
laws of Bermuda;
(xix) based solely upon a search of the Cause Book of the
Supreme Court of Bermuda conducted at approximately 9:30 am on
August 15, 2006 (which would not reveal details of proceedings which
have been filed but not actually entered in the Cause Book at the
time of our search), there are no judgments against the Company, nor
any legal or governmental proceedings pending in Bermuda to which
the Company is subject; and
(xx) based solely on a search of the Register of Charges
maintained by the Registrar of Companies pursuant to Section 55 of
the Companies Act 1981 conducted at approximately 9:30 am on August
15, 2006 (which would not reveal details of matters which have been
lodged for registration but not actually registered at the time of
our search), there are no charges registered on the assets of the
Company and four charges registered on the assets of the IPCRe.
(g) The Underwriters shall have received on the Closing Date an
opinion of Xxxxxxxx, Xxxxxx, Xxxxx & Xxxx, special counsel to the Selling
Shareholder, to the effect that:
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(i) this Agreement has been duly authorized, executed and
delivered by the Selling Shareholder; and
(ii) to such Counsel's knowledge, each Underwriter that has
purchased such Shares delivered on the Closing Date to The
Depository Trust Company or other securities intermediary by making
payment therefor as provided herein, and that has had such Shares
credited to the securities account or accounts of such Underwriters
maintained with The Depository Trust Company or such other
securities intermediary will have acquired a security entitlement
(within the meaning of Section 8-102(a)(17) of the UCC) to such
Shares purchased by such Underwriter, and no action based on an
adverse claim (within the meaning of Section 8-105 of the UCC) may
be asserted against such Underwriter with respect to such Shares.
For the purposes of this opinion, such counsel may assume that when
such payment, delivery and crediting occur, (A) the Underwriters do
not have notice of any adverse claim to the Shares or any financial
asset relating to the Shares or any shares of Common Stock that are
part of the securities entitlement of the Underwriters, (B) such
Shares will have been registered in the name of Cede & Co. or
another nominee designated by The Depository Trust Company, in each
case on the Company's share registry in accordance with its
certificate of incorporation, bylaws and applicable law, (C) The
Depository Trust Company will be registered as a "clearing
corporation" within the meaning of Section 8-102 of the UCC, (D)
appropriate entries to the accounts of the several Underwriters on
the records of The Depository Trust Company will have been made
pursuant to the UCC and (E) the "securities intermediary's
jurisdiction" (as defined in Section 8-110 of the UCC) of each
securities intermediary that acts as a clearing corporation or
maintains securities accounts with respect to the transfer of the
Shares to the Underwriters is the State of New York.
In rendering their opinion, such counsel may rely as to matters of fact,
to the extent such counsel deems proper, on certificates of responsible
officers of the Selling Shareholder and certificates or other written
statements of officials of jurisdictions having custody of documents
respecting the corporate existence or good standing of the Selling
Shareholder.
In rendering their opinion, such counsel may state that they express no
opinion other than as to the corporate laws of the State of New York and
the federal securities laws of the United States.
(h) The Underwriters shall have received on the Closing Date an
opinion of Xxxxxxxx Xxxxxxx, Senior Vice President - Secretary and Deputy
General Counsel of the Selling Shareholder covering the following:
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(i) The Selling Shareholder has the legal right and authority
to sell, transfer and deliver in the manner provided in this
Agreement the Shares being sold by the Selling Shareholder
hereunder; and
(ii) No consent, approval, authorization or order of any court
or governmental agency or body is required for the consummation by
the Selling Shareholder of the transactions contemplated herein,
except such as may have been obtained under the Securities Act and
such as may be required under the blue sky laws of any jurisdiction
in connection with the purchase and distribution of the Shares by
the Underwriters and such other approvals (specified in such
opinion) as have been obtained.
(i) The Underwriters shall have received on the Closing Date an
opinion (which opinion may be rendered in reliance upon the appropriate
opinions of Xxxxxxx Xxxx & Xxxxxxx as to Bermuda law) of Xxxxx Xxxx &
Xxxxxxxx, counsel for the Underwriters, dated the Closing Date, covering
the matters referred to in Sections 6(e)(ix) and 6(e)(x) (but only as to
the statements in the Disclosure Package and the Final Prospectus under
"Underwriting" insofar as such statement set forth the information
required to be stated therein) above.
With respect to Section 6(e)(ix) above, Xxxxxxxx & Xxxxxxxx LLP and
Xxxxx Xxxx & Xxxxxxxx may state that their opinion and belief are based
upon their participation in the preparation of the Registration Statement,
Disclosure Package and Final Prospectus and any amendments or supplements
thereto and review and discussion of the contents thereof, but are without
independent check or verification, except as specified.
The opinions of Xxxxxxxx & Xxxxxxxx LLP and Xxxxxxx Xxxx & Xxxxxxx
described in Sections 6(e) and 6(f) above shall be rendered to the
Underwriters at the request of the Company and shall so state therein.
(j) The Underwriters shall have received, on each of the date hereof
and the Closing Date, a letter dated the date hereof or the Closing Date,
as the case may be, in form and substance satisfactory to the
Underwriters, from KPMG, independent registered public accounting firm,
containing statements and information of the type ordinarily included in
accountants' "comfort letters" to underwriters with respect to the
financial statements and certain financial information contained in or
incorporated by reference into the Disclosure Package, the Final
Prospectus and the Registration Statement; provided, that the letter
delivered on the Closing Date shall use a "cut-off date" not earlier than
the date hereof.
(k) The "lock-up" agreements between you and certain officers and
directors of the Company, each substantially in the form of Exhibit A-1
hereto relating to sales and certain other dispositions of shares of
Common Stock or certain
-24-
other securities, delivered to you on or before the date hereof, shall be
in full force and effect on the Closing Date.
The several obligations of the Underwriters to purchase Additional
Shares hereunder are subject to the delivery to you on the Option Closing Date
of such documents as you may reasonably request with respect to the good
standing of the Company and the Designated Subsidiaries, the due authorization
and issuance of the Additional Shares and other matters related to the sale of
the Additional Shares.
7. Covenants of the Company and the Selling Shareholder. In further
consideration of the agreements of the Underwriters herein contained:
(i) The Company agrees with the several Underwriters that:
(a) Prior to the termination of the offering of the Shares, the
Company will not file any amendment of the Registration Statement or
supplement (including the Final Prospectus or any Preliminary Prospectus)
to the Basic Prospectus unless the Company has furnished you a copy for
your review prior to filing and will not file any such proposed amendment
or supplement to which you reasonably object. The Company will cause the
Final Prospectus, properly completed, and any supplement thereto to be
filed in a form approved by the Representative with the Commission
pursuant to the applicable paragraph of Rule 424(b) within the time period
prescribed and will provide evidence satisfactory to the Representative of
such timely filing. The Company will promptly advise the Representative
(i) when the Final Prospectus, and any supplement thereto, shall have been
filed (if required) with the Commission pursuant to Rule 424(b), (ii)
when, prior to termination of the offering of the Shares, any amendment to
the Registration Statement shall have been filed or become effective,
(iii) of any request by the Commission or its staff for any amendment of
the Registration Statement, or any Rule 462(b) Registration Statement, or
for any supplement to the Final Prospectus or for any additional
information, (iv) of the issuance by the Commission of any stop order
suspending the effectiveness of the Registration Statement or of any
notice objecting to its use or the institution or threatening of any
proceeding for that purpose and (v) of the receipt by the Company of any
notification with respect to the suspension of the qualification of the
Shares for sale in any jurisdiction or the institution or threatening of
any proceeding for such purpose. The Company will use its best efforts to
prevent the issuance of any such stop order or the occurrence of any such
suspension or objection to the use of the Registration Statement and, upon
such issuance, occurrence or notice of objection, to obtain as soon as
possible the withdrawal of such stop order or relief from such occurrence
or objection, including, if necessary, by filing an amendment to the
Registration Statement or a new registration statement and using its best
efforts to have such amendment or new registration statement declared
effective as soon as practicable.
-25-
(b) If, at any time prior to the filing of the Final Prospectus
pursuant to Rule 424(b), any event occurs as a result of which the
Disclosure Package would include any untrue statement of a material fact
or omit to state any material fact necessary to make the statements
therein in the light of the circumstances under which they were made at
such time not misleading, the Company will (i) notify promptly the
Representative so that any use of the Disclosure Package may cease until
it is amended or supplemented; (ii) amend or supplement the Disclosure
Package to correct such statement or omission; and (iii) supply any
amendment or supplement to you in such quantities as you may reasonably
request.
(c) If, at any time when a prospectus relating to the Shares is
required to be delivered under the Act (including in circumstances where
such requirement may be satisfied pursuant to Rule 172), any event occurs
as a result of which the Final Prospectus as then supplemented would
include any untrue statement of a material fact or omit to state any
material fact necessary to make the statements therein in the light of the
circumstances under which they were made or the circumstances then
prevailing not misleading, or if it shall be necessary to amend the
Registration Statement, file a new registration statement or supplement
the Final Prospectus to comply with the Act or the Exchange Act or the
respective rules thereunder, including in connection with use or delivery
of the Final Prospectus, the Company promptly will (i) notify the
Representative of any such event, (ii) prepare and file with the
Commission, subject to the second sentence of paragraph (a) of this
Section 7, an amendment or supplement or new registration statement which
will correct such statement or omission or effect such compliance, (iii)
use its best efforts to have any amendment to the Registration Statement
or new registration statement declared effective as soon as practicable in
order to avoid any disruption in use of the Final Prospectus and (iv)
supply any supplemented Final Prospectus to you in such quantities as you
may reasonably request.
(d) As soon as practicable, the Company will make generally
available to its security holders and to the Representative an earnings
statement or statements of the Company and its subsidiaries which will
satisfy the provisions of Section 11(a) of the Act and Rule 158.
(e) The Company will furnish to the Representative and counsel for
the Underwriters, without charge, signed copies of the Registration
Statement (including exhibits thereto) and to each other Underwriter a
copy of the Registration Statement (without exhibits thereto) and, so long
as delivery of a prospectus by an Underwriter or dealer may be required by
the Act (including in circumstances where such requirement may be
satisfied pursuant to Rule 172), as many copies of each Preliminary
Prospectus, the Final Prospectus and any Issuer Free Writing Prospectus
and any supplement thereto as the Representative may reasonably request.
-26-
(f) The Company will arrange, if necessary, for the qualification of
the Shares for sale under the laws of such jurisdictions as the
Representative may designate and will maintain such qualifications in
effect so long as required for the distribution of the Shares; provided
that in no event shall the Company be obligated to qualify to do business
in any jurisdiction where it is not now so qualified or to take any action
that would subject it to service of process in suits, other than those
arising out of the offering or sale of the Shares, in any jurisdiction
where it is not now so subject.
(g) The Company agrees that, unless it has or shall have obtained
the prior written consent of the Representative, and each Underwriter,
severally and not jointly, agrees with the Company that, unless it has or
shall have obtained, as the case may be, the prior written consent of the
Company, it has not made and will not make any offer relating to the
Shares that would constitute an Issuer Free Writing Prospectus or that
would otherwise constitute a "free writing prospectus" (as defined in Rule
405) required to be filed by the Company with the Commission or retained
by the Company under Rule 433. Any such free writing prospectus consented
to by the Representative or the Company is hereinafter referred to as a
"Permitted Free Writing Prospectus." The Company agrees that (x) it has
treated and will treat, as the case may be, each Permitted Free Writing
Prospectus as an Issuer Free Writing Prospectus and (y) it has complied
and will comply, as the case may be, with the requirements of Rules 164
and 433 applicable to any Permitted Free Writing Prospectus, including in
respect of timely filing with the Commission, legending and record
keeping.
(h) The Company will not take, directly or indirectly, any action
designed to or that would constitute or that might reasonably be expected
to cause or result in, under the Exchange Act or otherwise, stabilization
or manipulation of the price of any security of the Company to facilitate
the sale or resale of the Shares.
(ii) The Selling Shareholder agrees with the several Underwriters
that:
(a) The Selling Shareholder agrees to pay the costs and expenses
relating to the following matters: (i) the SEC filing fees and the
preparation, printing or reproduction and filing with the Commission of
the Registration Statement (including financial statements and exhibits
thereto), the Preliminary Prospectus and the Final Prospectus and any
Issuer Free Writing Prospectus, and each amendment or supplement to any of
them; (ii) the printing (or reproduction) and delivery (including postage,
air freight charges and charges for counting and packaging) of such copies
of the Registration Statement, the Preliminary Prospectus and the Final
Prospectus and any Issuer Free Writing Prospectus, and all amendments or
supplements to any of them, as may, in each case, be reasonably requested
for use in connection with the offering and sale of the Shares; (iii) the
preparation, printing, authentication, issuance and delivery of
-27-
certificates for the Shares, including any stamp or transfer taxes in
connection with the original issuance and sale of the Shares; (iv) the
printing (or reproduction) and delivery of this Agreement, any blue sky
memorandum and all other agreements or documents printed (or reproduced)
and delivered in connection with the offering of the Shares; (v) any
registration or qualification of the Shares for offer and sale under the
securities or blue sky laws of the several states (including filing fees
and the reasonable fees and expenses of counsel for the Underwriters
relating to such registration and qualification); (vi) any filings
required to be made with the NASD, Inc. (including filing fees and the
reasonable fees and expenses of counsel for the Underwriters relating to
such filings); (vii) all of the Company's roadshow expenses, including the
transportation and other expenses incurred by or on behalf of Company
representatives in connection with presentations to prospective purchasers
of the Shares; (viii) the fees and expenses of the Company's accountants
and the fees and expenses of counsel (including local and special counsel)
for the Company and the Selling Shareholder; and (ix) all other costs and
expenses incident to the performance by the Company and the Selling
Shareholder of their obligations hereunder.
(b) The Selling Shareholder will not, during the period commencing
on the date hereof and ending 60 days after the date of the Final
Prospectus, without the prior written consent of Citigroup Global Markets
Inc., offer, sell, contract to sell, pledge or otherwise dispose of, (or
enter into any transaction which is designed to, or might reasonably be
expected to, result in the disposition (whether by actual disposition or
effective economic disposition due to cash settlement or otherwise) by the
Selling Shareholder or any affiliate of the Selling Shareholder or any
person in privity with the Selling Shareholder or any affiliate of the
Selling Shareholder) directly or indirectly, or file (or participate in
the filing of) a registration statement with the Commission in respect of,
or establish or increase a put equivalent position or liquidate or
decrease a call equivalent position within the meaning of Section 16 of
the Exchange Act with respect to, any shares of Common Stock of the
Company or any securities convertible into or exercisable or exchangeable
for, shares of Common Stock; or publicly announce an intention to effect
any such transaction other than shares of Common Stock disposed of as bona
fide gifts approved by Citigroup Global Markets Inc. Notwithstanding the
foregoing, if (x) during the last 17 days of the restricted period the
Company issues an earnings release or material news or a material event
relating to the Company occurs, or (y) prior to the expiration of the
restricted period, the Company announces that it will release earnings
results during the 16-day period beginning on the last day of the
restricted period, the restrictions imposed in this clause shall continue
to apply until the expiration of the 18-day period beginning on the
issuance of the earnings release or the occurrence of the material news or
material event.
(c) The Selling Shareholder will not take, directly or indirectly,
any action designed to or that would constitute or that might reasonably
be expected
-28-
to cause or result in, under the Exchange Act or otherwise, stabilization
or manipulation of the price of any security of the Company to facilitate
the sale or resale of the Shares.
(d) The Selling Shareholder will advise you promptly, and if
requested by you, will confirm such advice in writing, so long as delivery
of a prospectus relating to the Shares by an underwriter or dealer may be
required under the Act, of any change in information in the Registration
Statement, the Final Prospectus, any Preliminary Prospectus or any Issuer
Free Writing Prospectus or any amendment or supplement thereto relating to
such Selling Shareholder.
(e) Such Selling Shareholder represents that it has not prepared or
had prepared on its behalf or used or referred to, and agrees that it will
not prepare or have prepared on its behalf or use or refer to, any Free
Writing Prospectus, and has not distributed and will not distribute any
written materials in connection with the offer or sale of the Shares.
8. Indemnity and Contribution. (a) The Company agrees to indemnify
and hold harmless each Underwriter, the directors, officers, employees and
agents of each Underwriter and each person, if any, who controls any Underwriter
within the meaning of either Section 15 of the Securities Act or Section 20 of
the Exchange Act and each affiliate of any Underwriter within the meaning of
Rule 405 under the Securities Act, from and against any and all losses, claims,
damages and liabilities (including, without limitation, any legal or other
expenses reasonably incurred in connection with defending or investigating any
such action or claim) caused by any untrue statement or alleged untrue statement
of a material fact contained in the Registration Statement or any amendment
thereof, or in the Basic Prospectus, the Disclosure Package, the Final
Prospectus or any Issuer Free Writing Prospectus, or in any amendment thereof or
supplement thereto, or caused by any omission or alleged omission to state
therein a material fact required to be stated therein or necessary to make the
statements therein not misleading, except insofar as such losses, claims,
damages or liabilities are caused by any such untrue statement or omission or
alleged untrue statement or omission based upon the Selling Shareholder
Information or information relating to any Underwriter furnished to the Company
in writing by such Underwriter through you expressly for use therein.
(b) The Selling Shareholder severally agrees to indemnify and hold
harmless the Company, each of its directors, each of its officers who
signs the Registration Statement, each Underwriter, the directors,
officers, employees and agents of each Underwriter and each person who
controls the Company or any Underwriter within the meaning of either the
Act or the Exchange Act and each other Selling Shareholder, if any, to the
same extent as the foregoing indemnity from the Company to each
Underwriter, but only with reference to the Selling Shareholder
Information and except insofar as such losses, claims, damages or
liabilities are caused by any such untrue statement or omission or alleged
untrue statement or omission based upon any information provided by the
Company or
-29-
information relating to any Underwriter furnished to the Company in
writing by such Underwriter through you expressly for use therein. This
indemnity agreement will be in addition to any liability which any Selling
Shareholder may otherwise have.
(c) Each Underwriter agrees, severally and not jointly, to indemnify
and hold harmless the Company, its directors, its officers who sign the
Registration Statement and each person, if any, who controls the Company
within the meaning of either Section 15 of the Securities Act or Section
20 of the Exchange Act and the Selling Shareholder, to the same extent as
the foregoing indemnity from the Company to such Underwriter, but only
with reference to information relating to such Underwriter furnished to
the Company in writing by such Underwriter through you expressly for use
in the documents referred to in the foregoing indemnity. The Company and
the Selling Shareholder acknowledge that the statements set forth (i) in
the last paragraph of the cover page regarding delivery of the Shares and,
under the heading "Underwriting", (ii) the list of Underwriters and their
respective participation in the sale of the Shares, (iii) the sentences
related to concessions and reallowances and (iv) the paragraph related to
stabilization, syndicate covering transactions and penalty bids in the
Preliminary Prospectus and the Final Prospectus constitute the only
information furnished in writing by or on behalf of the several
Underwriters for inclusion in the Preliminary Prospectus, the Final
Prospectus or any Issuer Free Writing Prospectus.
(d) In case any proceeding (including any governmental
investigation) shall be instituted involving any person in respect of
which indemnity may be sought pursuant to Section 8(a), 8(b) or 8(c), such
person (the "INDEMNIFIED PARTY") shall promptly notify the person against
whom such indemnity may be sought (the "INDEMNIFYING PARTY") in writing
and the indemnifying party, upon request of the indemnified party, shall
retain counsel reasonably satisfactory to the indemnified party to
represent the indemnified party and any others the indemnifying party may
designate in such proceeding and shall pay 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, but the
fees and expenses of such counsel shall be at the expense of such
indemnified party unless: (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 respect of the legal
expenses of any indemnified party 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 (in addition to any local
counsel) for all such indemnified parties and that all such reasonable
fees
-30-
and expenses shall be reimbursed as they are incurred. Such firm shall be
designated in writing by Citigroup Global Markets Inc. in the case of
parties indemnified pursuant to Sections 8(a) and 8(b) and by the Company,
in the case 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
against any loss or liability by reason of such settlement or judgment. No
indemnifying party shall, without the prior written consent of the
indemnified party, effect any settlement of any pending or threatened
proceeding in 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 and does not include a statement as to or an admission
of fault, culpability or a failure to act, by or on behalf of any
indemnified party.
(e) Subject to Section 8(h), to the extent the indemnification
provided for in Section 8(a), 8(b) or 8(c) is unavailable to an
indemnified party or insufficient in respect of any losses, claims,
damages or liabilities referred to therein, then each indemnifying party
under such paragraph, in lieu of indemnifying such indemnified party
thereunder, shall contribute to the amount paid or payable by such
indemnified party as a result of such losses, claims, damages or
liabilities: (i) in such proportion as is appropriate to reflect the
relative benefits received by such indemnifying party or parties or their
affiliates on the one hand and the indemnified party or parties on the
other hand from the offering of the Shares; or (ii) if the allocation
provided by clause 8(e)(i) above is not permitted by applicable law, in
such proportion as is appropriate to reflect not only the relative
benefits referred to in clause 8(e)(i) above but also the relative fault
of such indemnifying party or parties on the one hand and of indemnified
party or parties or their affiliates on the other hand in connection with
the statements or omissions that resulted in such losses, claims, damages
or liabilities, as well as any other relevant equitable considerations.
The relative benefits received by the Company and the Selling Shareholder
on the one hand and the Underwriters on the other hand in connection with
the offering of the Shares shall be deemed to be in the same respective
proportions as the net proceeds from the offering of the Shares (before
deducting expenses) received by the Company and it affiliates and the
total underwriting discounts and commissions received by the Underwriters,
in each case as set forth in the table on the cover of the Final
Prospectus, bear to the aggregate Public Offering Price of the Shares. The
relative fault of the Company and its affiliates on the one hand and the
Underwriters on the other hand 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, the Selling Shareholder or by the
Underwriters and the
-31-
parties' relative intent, knowledge, access to information and opportunity
to correct or prevent such statement or omission. The Underwriters'
respective obligations to contribute pursuant to this Section 8 are
several in proportion to the respective number of Shares they have
purchased hereunder, and not joint.
(f) The Company, the Selling Shareholder and the Underwriters agree
that it would not be just or equitable if contribution pursuant to this
Section 8 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 that does not take account of the equitable considerations
referred to in Section 8(d). The amount paid or payable by an indemnified
party as a result of the losses, claims, damages and liabilities referred
to in the immediately preceding paragraph shall be deemed to include,
subject to the limitations set forth above, 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 Section 8, no Underwriter shall be required to
contribute any amount in excess of the amount by which the total price at
which the Shares underwritten by it and distributed to the public were
offered to the public exceeds the amount of any damages that such
Underwriter has otherwise been required to pay by reason of such untrue or
alleged untrue statement or omission or alleged omission. No person guilty
of fraudulent misrepresentation (within the meaning of Section 11(f) of
the Securities Act) shall be entitled to contribution from any person who
was not guilty of such fraudulent misrepresentation. The remedies provided
for in this Section 8 are not exclusive and shall not limit any rights or
remedies which may otherwise be available to any indemnified party at law
or in equity.
(g) The indemnity and contribution provisions contained in this
Section 7 and the representations, warranties and other statements of the
Company and the Selling Shareholder contained in this Agreement shall
remain operative and in full force and effect regardless of: (i) any
termination of this Agreement; (ii) any investigation made by or on behalf
of any Underwriter or any person controlling any Underwriter or any
affiliate of any Underwriter or by or on behalf of the Selling Shareholder
or the Company, its officers or directors or any person controlling the
Company or the Selling Shareholder; and (iii) acceptance of and payment
for any of the Shares.
(h) The liability of the Selling Shareholder under the Selling
Shareholder's representations and warranties contained in Section 2 hereof
and under the indemnity and contribution agreements contained in this
Section 8 shall be limited to an amount equal to the initial public
offering price of the Shares sold by the Selling Shareholder to the
Underwriters. The Company and the Selling Shareholder may agree, as among
themselves and without limiting the rights of the Underwriters under this
Agreement, as to the respective amounts of such liability for which they
each shall be responsible.
-32-
9. Termination. This Agreement shall be subject to termination by
notice given by you to the Company, if after the execution and delivery of this
Agreement and prior to the Closing Date: (i) trading generally shall have been
suspended or materially limited on or by, as the case may be, any of the New
York Stock Exchange, the American Stock Exchange, the Nasdaq National Market
System, the Nasdaq Global Select Market, the Chicago Board of Options Exchange,
the Chicago Mercantile Exchange or the Chicago Board of Trade, (ii) trading of
any securities of the Company shall have been suspended on any exchange or in
any over-the-counter market, (iii) a material disruption in securities
settlement, payment or clearance services in the United States shall have
occurred, (iv) a general moratorium on commercial banking activities in New York
shall have been declared by either Federal or New York State authorities or in
Bermuda by Bermuda authorities, or (v) there shall have occurred any outbreak or
escalation of hostilities or any change in financial markets or any calamity or
crisis that, in your judgment, is material and adverse; and in the case of any
of the events specified 10(a)(i) through 10(a)(v), singly or together with any
other event, makes it, in your judgment, impracticable or inadvisable to proceed
with the offer, sale, or delivery of the Shares on the terms and in the manner
contemplated in the Disclosure Package and the Final Prospectus.
10. Effectiveness; Defaulting Underwriters. (a) This Agreement shall
become effective upon the execution and delivery hereof by the parties hereto.
(b) If, on the Closing Date or the Option Closing Date, as the case
may be, any one or more of the Underwriters shall fail or refuse to purchase
Shares that it has or they have agreed to purchase hereunder on such date, and
the aggregate number of Shares which such defaulting Underwriter or Underwriters
agreed but failed or refused to purchase is not more than one-twelfth of the
aggregate number of the Shares to be purchased on such date, the other
Underwriters shall be obligated severally in the proportions that the number of
Firm Shares set forth opposite their respective names in Schedule I bears to the
aggregate number of Firm Shares set forth opposite the names of all such
non-defaulting Underwriters, or in such other proportions as you may specify, to
purchase the Shares which such defaulting Underwriter or Underwriters agreed but
failed or refused to purchase on such date; provided, that in no event shall the
number of Shares that any Underwriter has agreed to purchase pursuant to this
Agreement be increased pursuant to this Section 10 by an amount in excess of
one-ninth of such number of Shares without the written consent of such
Underwriter. If, on the Closing Date, any Underwriter or Underwriters shall fail
or refuse to purchase Firm Shares and the aggregate number of Firm Shares with
respect to which such default occurs is more than one-twelfth of the aggregate
number of Firm Shares to be purchased, and arrangements satisfactory to you, the
Selling Shareholder and the Company for the purchase of such Firm Shares are not
made within 36 hours after such default, this Agreement shall terminate without
liability on the part of any non-defaulting Underwriter, the Selling Shareholder
or the Company. In any such case either you, the Selling Shareholder or the
Company shall have the right to postpone the Closing Date, but in no event for
longer than seven days, in order that the required changes, if any, in the
Registration Statement
-33-
and in the Final Prospectus or in any other documents or arrangements may be
effected. If, on the Option Closing Date, any Underwriter or Underwriters shall
fail or refuse to purchase Additional Shares and the aggregate number of
Additional Shares with respect to which such default occurs is more than
one-twelfth of the aggregate number of Additional Shares to be purchased, the
non-defaulting Underwriters shall have the option to (i) terminate their
obligation hereunder to purchase Additional Shares or (ii) purchase not less
than the number of Additional Shares that such non- defaulting Underwriters
would have been obligated to purchase in the absence of such default. Any action
taken under this paragraph shall not relieve any defaulting Underwriter from
liability in respect of any default of such Underwriter under this Agreement.
(c) If this Agreement shall be terminated by the Underwriters, or
any of them, because of any failure or refusal on the part of the Selling
Shareholder or the Company to comply with the terms or to fulfill any of the
conditions of this Agreement, or if for any reason the Selling Shareholder or
the Company shall be unable to perform its obligations under this Agreement
(other than pursuant to the foregoing paragraphs of this Section 10), the
Company and the Selling Shareholder will be jointly liable to reimburse the
Underwriters or such Underwriters as have so terminated this Agreement with
respect to themselves, severally, for all out-of-pocket expenses (including the
fees and disbursements of their counsel) reasonably incurred by such
Underwriters in connection with this Agreement or the offering contemplated
hereunder.
11. Submission to Jurisdiction; Appointment of Agent for Service. In
further consideration of the agreement of the Underwriters herein contained, the
Company irrevocably agrees and covenants that any legal suit, action or
proceeding against the Company brought by any Underwriter or by any person who
controls such Underwriter within the meaning of either Section 15 of the
Securities Act of Section 20 of the Exchange Act (a "CONTROL PERSON") arising
out of or based upon this Agreement or the transactions contemplated hereby may
be instituted in any New York Court, and irrevocably waives any objection which
it may now or hereafter have to the laying of venue of any such proceeding,
irrevocably waives any objection based on the absence of a necessary or
indispensable party in any such proceeding and irrevocably submits to the
non-exclusive jurisdiction of such courts in any such suit, action or
proceeding. The Company irrevocably waives any immunity to jurisdiction to which
it may otherwise be entitled or become entitled (including immunity to
pre-judgment attachment and execution) in any legal suit, action or proceeding
against it arising out of this Agreement or the transactions contemplated hereby
which is instituted in any New York Court, or in any Bermuda court. To the
extent permitted by law, Company hereby waives any objection to the enforcement
by any competent foreign court of any judgment validly obtained in any such
proceeding. The Company designates and appoints CT Corporation System in The
City of New York at 000 Xxxxxx Xxxxxx, Xxx Xxxx, XX 00000, as its respective
authorized agent (the "AUTHORIZED AGENT") upon which process may be served in
any such action arising out of or based on this Agreement or the transactions
contemplated hereby which may be instituted in any New York Court by any
Underwriter or by any Control Person, expressly consents to the non-exclusive
jurisdiction of any
-34-
such court in respect of any such action, and waives any other requirements of
or objections to personal jurisdiction with respect thereto. Such appointments
shall be irrevocable. The Company represents and warrants that the Authorized
Agent has agreed to act as said agent for service of process and the Company
agrees to take any and all action, including the filing of any and all documents
and instruments, that may be necessary to continue such appointment in full
force and effect as aforesaid. Service of process upon the Company's Authorized
Agent and written notice of such service of process to it shall be deemed, in
every respect, effective service of process upon the Company. Notwithstanding
the foregoing, any action based on this Agreement or the transactions
contemplated hereby may be instituted by any Underwriter or any Control Person
in any competent foreign court.
12. Judgment Currency. In respect of any judgment or order given or
made for any amount due hereunder that is expressed and paid in currency (the
"JUDGMENT CURRENCY") other than United States dollars, the party against whom
such judgment or order has been given or made (the "INDEMNITOR") will indemnify
each party in whose favor such judgment or order has been given or made (the
"INDEMNITEE") against any loss incurred by such Indemnitee as a result of any
variation as between (i) the rate of exchange at which the United States dollar
amount is converted into the judgment currency for the purpose of such judgment
or order and (ii) the rate of exchange at which the Indemnitee is able to
purchase United States dollars with the amount of the judgment currency actually
received by such Indemnitee. The foregoing indemnity shall constitute a separate
and independent obligation of the Company, the Selling Shareholder, and the
Underwriters and shall continue in full force and effect notwithstanding any
such judgment or order as aforesaid. The term "rate of exchange" shall include
any reasonable premiums and costs of exchange payable in connection with the
purchase of or conversion into United States dollars.
13. No Fiduciary Duty. The Company and the Selling Shareholder
acknowledge that in connection with the offering of the Shares: (i) the
Underwriters have acted at arms length, are not agents of, and owe no fiduciary
duties to, the Company, or the Selling Shareholder or any other person, (ii) the
Underwriters owe the Company and the Selling Shareholder only those duties and
obligations set forth in this Agreement and (iii) the Underwriters may have
interests that differ from those of the Company and the Selling Shareholder. The
Company and the Selling Shareholder waive to the full extent permitted by
applicable law any claims they may have against the Underwriters arising from an
alleged breach of fiduciary duty in connection with the offering of the Shares.
14. Counterparts. This Agreement may be signed in two or more
counterparts, each of which shall be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.
15. Applicable Law. This Agreement shall be governed by and
construed in accordance with the internal laws of the State of New York.
-35-
16. Headings. The headings of the sections of this Agreement have
been inserted for convenience of reference only and shall not be deemed a part
of this Agreement.
17. Notices. All communications hereunder will be in writing and
effective only on receipt, and, if sent to the Representative, will be mailed,
delivered or telefaxed to the Citigroup Global Markets Inc. General Counsel (fax
no.: (000) 000-0000) and confirmed to the General Counsel, Citigroup Global
Markets Inc., at 000 Xxxxxxxxx Xxxxxx, Xxx Xxxx, Xxx Xxxx, 00000, Attention:
General Counsel; and to the Global Capital Markets Syndicate Desk or, if sent to
the Company, will be mailed, delivered or telefaxed to 000-000-0000 and
confirmed to it at 000-000-0000 , Attention: Corporate Secretary; or if sent to
the Selling Shareholder will be mailed, delivered or telefaxed to American
International Group, Inc., Attention: Corporate Secretary, 00 Xxxx Xxxxxx, Xxx
Xxxx, Xxx Xxxx 00000 (fax no.: (000) 000-0000).
18. Integration. This Agreement supersedes all prior agreements and
understandings (whether written or oral) between the Company and the
Underwriters, or any of them, with respect to the subject matter hereof.
19. Waiver of Jury Trial. The Company and the Selling Shareholder
hereby irrevocably waive, to the fullest extent permitted by applicable law, any
and all right to trial by jury in any legal proceeding arising out of or
relating to this Agreement or the transactions contemplated hereby.
20. Definitions. The terms that follow, when used in this Agreement,
shall have the meanings indicated.
"Act" shall mean the Securities Act of 1933, as amended, and the
rules and regulations of the Commission promulgated thereunder.
"Basic Prospectus" shall mean the base prospectus referred to in
paragraph 1(a) above contained in the Registration Statement at the
Execution Time.
"Business Day" shall mean any day other than a Saturday, a Sunday or
a legal holiday or a day on which banking institutions or trust companies
are authorized or obligated by law to close in New York City.
"Commission" shall mean the Securities and Exchange Commission.
"Disclosure Package" shall mean (i) the Basic Prospectus, (ii) the
Preliminary Prospectus used most recently prior to the Execution Time and
(iii) any Free Writing Prospectus that the parties hereto shall hereafter
expressly agree in writing to treat as part of the Disclosure Package.
-36-
"Effective Date" shall mean each date and time that the Registration
Statement and any post-effective amendment or amendments thereto became or
becomes effective.
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended, and the rules and regulations of the Commission promulgated
thereunder.
"Execution Time" shall mean the date and time that this Agreement is
executed and delivered by the parties hereto.
"Final Prospectus" shall mean the prospectus supplement relating to
the Shares that was first filed pursuant to Rule 424(b) after the
Execution Time, together with the Basic Prospectus.
"Free Writing Prospectus" shall mean a free writing prospectus, as
defined in Rule 405.
"Issuer Free Writing Prospectus" shall mean an issuer free writing
prospectus, as defined in Rule 433.
"Preliminary Prospectus" shall mean any preliminary prospectus
supplement to the Basic Prospectus referred to in paragraph 1(a) above
which is used prior to the filing of the Final Prospectus, together with
the Basic Prospectus.
"Registration Statement" shall mean the registration statement
referred to in paragraph 1(i)(a) above, including exhibits and financial
statements and any prospectus supplement relating to the Shares that is
filed with the Commission pursuant to Rule 424(b) and deemed part of such
registration statement pursuant to Rule 430B, as amended on each Effective
Date and, in the event any post-effective amendment thereto becomes
effective prior to the Closing Date, shall also mean such registration
statement as so amended.
"Rule 158", "Rule 163", "Rule 164", "Rule 172", "Rule 405", "Rule
415", "Rule 424", "Rule 430B" and "Rule 433" refer to such rules under the
Act.
"Selling Shareholder Information" means the second sentence in the
first paragraph under "IPC Holdings, Ltd. - Relationship with AIG" and the
table under "Secondary Sale by AIG" in the Preliminary Prospectus and the
last half of the first sentence in "IPC Holdings - Relationship with AIG"
and the table in "Plan of Distribution - Secondary Sales by AIG" in the
Basic Prospectus.
"Well-Known Seasoned Issuer" shall mean a well-known seasoned
issuer, as defined in Rule 405.
-37-
Very truly yours,
IPC HOLDINGS, LTD.
By: /s/ Xxxxx Xxxxx
-----------------------------------------
Name: Xxxxx Xxxxx
Title: President and CEO
AMERICAN INTERNATIONAL GROUP, INC.
By: /s/Xxxxx Xxxxxxxxx
-----------------------------------------
Name: Xxxxx Xxxxxxxxx
Title: Senior Vice President-Strategic
Planning
Accepted as of the date hereof:
By: CITIGROUP GLOBAL MARKETS INC.
By: /s/ Xxxxxx Xxxxxx
-------------------------------
Name: Xxxxxx Xxxxxx
Title: Director
SCHEDULE I
NUMBER OF
FIRM SHARES
UNDERWRITERS TO BE PURCHASED
------------ ---------------
Citigroup Global Markets Inc........................... 5,358,800
Xxxxxx Xxxxxxx & Co. Incorporated...................... 2,679,400
Xxxxx, Xxxxxxxx & Xxxxx, Inc. ......................... 1,339,700
HSBC Securities (USA) Inc. ............................ 1,004,775
Wachovia Capital Markets, LLC.......................... 1,004,775
Xxxxxxx & Partners Securities, LLC..................... 669,850
Xxxxxx, Xxxxx Xxxxx, Inc............................... 669,850
Xxx-Xxxx, Xxxxxx Incorporated ........................ 669,850
Total................................ 13,397,000
==========
II-1
EXHIBIT A-1
[FORM OF OFFICER/DIRECTOR LOCK-UP]
[Date]
Citigroup Global Markets Inc.
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs and Mesdames:
The undersigned understands that the Representative proposes to
enter into an
Underwriting Agreement (the "
UNDERWRITING AGREEMENT") with
American International Group, Inc., a Delaware corporation (the "SELLING
SHAREHOLDER") and IPC Holdings, Ltd., a Bermuda company (the "COMPANY")
providing for the public offering (the "PUBLIC OFFERING") by the several
Underwriters, (the "UNDERWRITERS"), of the Selling Shareholder's 13,397,000
shares (the "SHARES") of the Common Shares, $.01 par value per share, of the
Company (the "COMMON Stock").
To induce the Underwriters that may participate in the Public
Offering to continue their efforts in connection with the Public Offering, the
undersigned hereby agrees that, without the prior written consent of the
Representative on behalf of the Underwriters, the undersigned will not, during
the period commencing on the date hereof and ending 60 days after the date of
the final prospectus relating to the Public Offering (the "PROSPECTUS"), (1)
offer, pledge, sell, contract to sell, sell any option or contract to purchase,
purchase any option or contract to sell, grant any option, right or warrant to
purchase, lend, or otherwise transfer or dispose of, directly or indirectly, any
shares of Common Stock or any securities convertible into or exercisable or
exchangeable for Common Stock or (2) enter into any swap or other arrangement
that transfers to another, in whole or in part, any of the economic consequences
of ownership of Common Stock, whether any such transaction described in clause
(1) or (2) above is to be settled by delivery of Common Stock or such other
securities, in cash or otherwise. In addition, the undersigned agrees that,
without the prior written consent of the Representative on behalf of the
Underwriters, it will not, during the period commencing on the date hereof and
ending 60 days after the date of the Final Prospectus, make any demand for or
exercise any right with respect to, the registration of any shares of Common
Stock or any security convertible into or exercisable or exchangeable for Common
Stock. The undersigned also agrees and consents to the entry of stop transfer
instructions with the Company's transfer agent and registrar against the
transfer of the undersigned's shares of Common Stock except in compliance with
the foregoing restrictions.
The undersigned understands that the Company, the Selling
Shareholder and the Underwriters are relying upon this Lock-Up Agreement in
proceeding toward consummation of the Public Offering. The undersigned further
understands that this Lock-Up Agreement is irrevocable and shall be binding upon
the undersigned's heirs, legal representatives, successors and assigns.
Whether or not the Public Offering actually occurs depends on a
number of factors, including market conditions. Any Public Offering will only be
made pursuant to an
Underwriting Agreement, the terms of which are subject to
negotiation between the Company and the Underwriters.
Very truly yours,
-------------------------------------------
(Name)
-------------------------------------------
(Address)
A-3-2
