DRAFT-AUGUST 6, 2001
_______________ Shares/1/
MAX RE CAPITAL LTD.
COMMON SHARES, PAR VALUE $1.00 PER SHARE
UNDERWRITING AGREEMENT
__________, 2001
______________________________________
/1/ Insert number of shares to be sold (not including green shoe).
______________, 2001
Xxxxxx Xxxxxxx & Co. Incorporated
Xxxxxxx Xxxxx Xxxxxx Inc.
c/o Morgan Xxxxxxx & Co.
Incorporated
0000 Xxxxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Dear Sirs and Mesdames:
Max Re Capital Ltd., a company existing under the laws of
Bermuda (the "Company"), proposes to issue and sell to the several Underwriters
named in Schedule I hereto (the "Underwriters") _______________ Common Shares,
par value $1.00 per share (the "Firm Shares"). The Company also proposes to
issue and sell to the several Underwriters not more than an additional
______________ Common Shares, par value $1.00 per share (the "Additional
Shares") if and to the extent that you, as Managers of the offering, shall have
determined to exercise, on behalf of the Underwriters, the right to purchase
such shares of common stock granted to the Underwriters in Section 2 hereof. The
Firm Shares and the Additional Shares are hereinafter collectively referred to
as the "Shares." The Common Shares, par value $1.00 per share, of the Company to
be outstanding after giving effect to the sales contemplated hereby are
hereinafter referred to as the "Common Stock."
The Company has filed with the Securities and Exchange
Commission (the "Commission") a registration statement, including a prospectus,
relating to the Shares. The registration statement as amended at the time it
becomes effective, including the information (if any) deemed to be part of the
registration statement at the time of effectiveness pursuant to Rule 430A under
the Securities Act of 1933, as amended (the "Securities Act"), is hereinafter
referred to as the "Registration Statement"; the prospectus in the form first
used to confirm sales of Shares is hereinafter referred to as the "Prospectus."
If the Company has filed an abbreviated registration statement to register
additional shares of Common Stock pursuant to Rule 462(b) under the Securities
Act (the "Rule 462 Registration Statement"), then any reference herein to the
term "Registration Statement" shall be deemed to include such Rule 462
Registration Statement.
As part of the offering contemplated by this Agreement,
Xxxxxxx Xxxxx Xxxxxx Inc. ("Xxxxxxx Xxxxx Xxxxxx") has agreed to reserve out of
the Firm Shares set forth opposite its name on the Schedule I to this Agreement,
__________ shares of Common Stock [(representing 5% of the total number of Firm
Shares)], for sale to persons who are directors, officers, or employees, or who
are otherwise associated with the Company (collectively, "Participants"), as set
forth in the Prospectus under the heading "Underwriters" (the "Directed Share
Program"). The Shares to be sold by Xxxxxxx Xxxxx Xxxxxx pursuant to the
Directed
2
Share Program (the "Directed Shares") will be sold by Xxxxxxx Xxxxx Xxxxxx
pursuant to this Agreement at the public offering price. Any Directed Shares not
orally confirmed for purchase by any Participants by the end of the business day
immediately following the date on which this Agreement is executed will be
offered to the public by Xxxxxxx Xxxxx Xxxxxx as set forth in the Prospectus.
1. Representations and Warranties. The Company represents and
warrants to and agrees with each of the Underwriters that:
(a) The Registration Statement has become
effective; no stop order suspending the effectiveness of the
Registration Statement is in effect, and no proceedings for
such purpose are pending before or threatened by the
Commission.
(b) (i) The Registration Statement, when it
became effective, did not contain and, as amended or
supplemented, if applicable, will not contain any untrue
statement of a material fact or omit to state a material fact
required to be stated therein or necessary to make the
statements therein not misleading, (ii) the Registration
Statement and the Prospectus comply and, as amended or
supplemented, if applicable, will comply in all material
respects with the Securities Act and the applicable rules and
regulations of the Commission thereunder and (iii) the
Prospectus does not contain and, as amended or supplemented,
if applicable, will not contain any untrue statement of a
material fact or omit to state a material fact necessary to
make the statements therein, in the light of the circumstances
under which they were made, not misleading, except that the
representations and warranties set forth in this paragraph do
not apply to statements or omissions in the Registration
Statement or the Prospectus based upon information relating to
any Underwriter furnished to the Company in writing by such
Underwriter through you expressly for use therein.
(c) The consolidated historical financial
statements and schedules of the Company and its consolidated
subsidiaries included in the Prospectus and the Registration
Statement present fairly in all material respects the
financial condition, results of operations and cash flows of
the Company as of the dates and for the periods indicated,
comply as to form with the applicable accounting requirements
of the Act and have been prepared in conformity with generally
accepted accounting principles applied on a consistent basis
throughout the periods involved (except as otherwise noted
therein). The consolidated balance sheets of the Company and
its subsidiaries as of December 31, 2000 and 1999 and the
related consolidated statements of income and comprehensive
income, changes in shareholders' equity and cash flows for the
year ended December 31, 2000 and the period from July 8, 1999
to December 31, 1999 have been audited by KPMG. The selected
financial data set forth under the caption "Selected Financial
Data" in the Prospectus and Registration Statement fairly
present, on the basis stated in the Prospectus and the
Registration Statement, the information included therein. All
statutory financial statements of Max Re Ltd., from which
certain ratios and other statistical data contained in the
Registration Statement and the Prospectus have been derived,
have for each relevant period been prepared in conformity with
the accounting practices required or permitted by applicable
Insurance Laws (as defined below) of Bermuda and present
fairly the information purported to be shown. Such accounting
3
practices have been applied on a consistent basis throughout
the periods involved. Statutory financial statements of Max Re
Ltd. are not required to be prepared pursuant to the insurance
laws of any jurisdiction other than Bermuda.
(d) KPMG, who have certified certain
financial statements of the Company and its consolidated
subsidiaries and delivered their report with respect to the
audited consolidated financial statements and schedules
included in the Prospectus, are independent public accountants
with respect to the Company within the meaning of the
Securities Act and the applicable published rules and
regulations thereunder.
(e) The Company 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
or lease its property and to conduct its business as described
in the 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, singly or in the aggregate, have a material adverse
effect on the condition (financial or otherwise), prospects,
earnings, business, operations or properties of the Company
and its subsidiaries, taken as a whole, whether or not arising
from transactions in the ordinary course of business (a
"Material Adverse Effect").
(f) Max Re Ltd., Max Re Diversified
Strategies, Ltd. ("MDS"), Max Re Managers Ltd. ("Max Re
Managers") and Max Re Europe Limited ("Max Re Europe") are the
only subsidiaries of the Company. Each subsidiary of the
Company has been duly formed and is validly existing and in
good standing under the laws of the jurisdiction of its
incorporation, has the corporate power and authority to own
its property and to conduct its business as described in the
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, singly or in
the aggregate, have a Material Adverse Effect; all of the
issued shares of capital stock of each subsidiary of the
Company other than Max Re Ltd., and all of the issued shares
of voting capital stock of Max Re Ltd., have been duly and
validly authorized and issued, are fully paid and
non-assessable and are owned by the Company directly or
through Max Re Ltd., free and clear of all liens,
encumbrances, equities or claims; and the shares representing
a 7.5% interest in Grand Central Re Limited are owned by the
Company directly or through Max Re Ltd., free and clear of all
liens, encumbrances, equities or claims. Except as described
in the Prospectus, there are no limits, 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 any of its
subsidiaries 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 any of its
subsidiaries, 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 transfer
4
any of such subsidiary's property or assets to the Company or
any other subsidiary of the Company.
(g) This Agreement has been duly authorized,
executed and delivered by the Company.
(h) The authorized capital stock of the
Company conforms as to legal matters to the description
thereof contained in the Prospectus.
(i) The shares of Common Stock outstanding
prior to the issuance of the Shares have been duly authorized
and are validly issued, fully paid (except to the extent that
shares of Common Stock purchased by certain executives of the
Company that were financed by Company loans, as is described
in the Prospectus under the caption "Certain Relationships and
Related Transactions-- Loans to Management," could be deemed
not to be fully paid) and non-assessable. The Shares have been
duly authorized and, when issued and delivered in accordance
with the terms of this Agreement, will be validly issued,
fully paid and non-assessable, and the issuance of such Shares
will not be subject to any preemptive or similar rights,
except to the extent that the right of certain strategic
investors and the Chief Executive Officer to receive warrants
upon the issuance of equity by the Company, as is described in
the Prospectus under the caption "Capital Stock-- Warrants,"
could be deemed to be a preemptive or similar right.
(j) Neither the Company nor any of its
subsidiaries is in violation of its memorandum of association
or bye-laws or other organizational document or, except to the
extent that any default would not, singly or in the aggregate,
have a Material Adverse Effect, 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 any of them is a party
or by which it or any of them or any of their properties may
be bound.
(k) At the Closing Date (as defined below),
the Company will have an authorized capitalization as set
forth in the Prospectus. Except as set forth in the
Prospectus, there are no outstanding options, warrants or
other rights calling for the issuance of, and there are no
commitments, plans or arrangements to issue, any shares of
capital stock of the Company or any of its subsidiaries or any
security convertible into or exchangeable or exercisable for
any shares of capital stock of the Company or any of it
subsidiaries. The form of certificates for the Shares conforms
to the requirements of the laws of Bermuda and the Nasdaq
National Market; and the Shares have been approved for
quotation on the Nasdaq National Market, subject to official
notice of issuance.
(l) 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 applicable law or the memorandum of association
or bye-laws of the Company or any agreement or other
instrument binding upon the Company or any of its subsidiaries
or any of their properties that is material to the Company and
its subsidiaries, taken as a whole, or any judgment, order or
decree of any governmental body, agency or court having
jurisdiction over the Company or any of its subsidiaries, and
no consent,
5
approval, authorization or order of, or qualification with,
any 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 or
Blue Sky or insurance securities laws of the various states in
connection with the offer and sale of the Shares, the filing
of the Prospectus under the Bermuda Companies Act 1981 in
connection with the offer and sale of the Shares and such as
may be required and have been obtained from the Bermuda
Monetary Authority.
(m) 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 prospects, earnings, business, operations
or properties of the Company and its subsidiaries, taken as a
whole, whether or not arising from transactions in the
ordinary course of business, from that set forth in the
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
Registration Statement and the Prospectus, (i) the Company and
its subsidiaries have not incurred any material liability or
obligation, direct or contingent, nor entered into any
material transaction not in the ordinary course of business;
(ii) the Company has not purchased any of its outstanding
capital stock, nor [, except for ____________,] [IF DIVIDEND
DECLARED BEFORE PRICING] declared, paid or otherwise made any
dividend or distribution of any kind on its capital stock
other than ordinary and customary dividends; and (iii) there
has not been any material change in the capital stock,
short-term debt or long-term debt of the Company and its
subsidiaries, except in each case as described in the
Prospectus.
(n) There are no legal or governmental
proceedings pending or threatened to which the Company or any
of its subsidiaries is a party or to which any of the
properties of the Company or any of its subsidiaries is
subject that are required to be described in the Registration
Statement or the Prospectus and are not so described or any
statutes, regulations, contracts or other documents that are
required to be described in the Registration Statement or the
Prospectus or to be filed as exhibits to the Registration
Statement that are not described or filed as required.
(o) Each preliminary prospectus filed as
part of the Registration Statement as originally filed or as
part of any amendment thereto, or filed pursuant 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.
(p) The Company and each of its subsidiaries
is not and, after giving effect to the offering and sale of
the Shares and the application of the proceeds thereof as
described in the Prospectus, will not be required to register
as an "investment company" as such term is defined in the
Investment Company Act of 1940, as amended (the "Investment
Company Act").
(q) The Company and its subsidiaries (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
6
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 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, singly or in the aggregate, have a Material Adverse
Effect.
(r) There are no costs or liabilities
associated with Environmental Laws (including, without
limitation, any capital or operating expenditures required for
clean-up, closure of properties or compliance with
Environmental Laws or any permit, license or approval, any
related constraints on operating activities and any potential
liabilities to third parties) which would, singly or in the
aggregate, have a Material Adverse Effect.
(s) The Company and each of its subsidiaries
maintain a system of internal accounting controls sufficient
to provide reasonable assurance that (i) transactions are
executed in accordance with management's general or specific
authorizations; (ii) transactions are recorded as necessary to
permit preparation of financial statements in conformity with
generally accepted accounting principles and to maintain asset
accountability; (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 the existing assets at reasonable intervals
and appropriate action is taken with respect to any
differences.
(t) The Company and its subsidiaries do not
own any real property and have good and marketable title to
all personal property owned by them which is material to the
business of the Company and its subsidiaries, in each case
free and clear of all liens, encumbrances and defects except
such as are described in the Prospectus or such as do not
materially affect the value of such property and do not
interfere with the use made and proposed to be made of such
property by the Company and its subsidiaries; and any real
property and buildings held under lease by the Company and its
subsidiaries are held by them under valid, subsisting and
enforceable leases with such exceptions as are not material
and do not interfere with the use made and proposed to be made
of such property and buildings by the Company and its
subsidiaries, in each case except as described in the
Prospectus.
(u) The Company and its subsidiaries own or
possess, or can acquire on reasonable terms, all material
patents, patent rights, licenses, inventions, copyrights,
know-how (including trade secrets and other unpatented and/or
unpatentable proprietary or confidential information, systems
or procedures), trademarks, service marks and trade names
currently employed by them in connection with the business now
operated by them, and neither the Company nor any of its
subsidiaries has received any notice of infringement of or
conflict with asserted rights of others with respect to any of
the foregoing which, singly or in the aggregate, if the
subject of an unfavorable decision, ruling or finding, would
have a Material Adverse Effect.
7
(v) No material labor dispute with the
employees of the Company or any of its subsidiaries exists,
except as described in the Prospectus, or, to the knowledge of
the Company, is imminent; and the Company is not aware of any
existing, threatened or imminent labor disturbance by the
employees of any of its principal suppliers, manufacturers or
contractors that could, singly or in the aggregate, have a
Material Adverse Effect.
(w) The Company and its subsidiaries are
insured by the insurers of recognized financial responsibility
against such losses and risks and in such amounts as are
prudent and customary in the businesses in which they are
engaged; and neither the Company nor any of its subsidiaries
has any reason to believe that it will not be able to renew
its existing insurance coverage as and when such coverage
expires or to obtain similar coverage from similar insurers as
may be necessary to continue its business at a cost that would
not, singly or in the aggregate, have a Material Adverse
Effect, except as described in the Prospectus.
(x) Except as described in the 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.
(y) The Statements in the Prospectus under
the caption "Material Tax Considerations" insofar as such
statements constitute summaries of the legal matters,
documents or proceedings referred to therein, fairly summarize
the matters referred to therein.
(z) Max Re Ltd. is duly registered by the
Bermuda Minister of Finance as a long-term insurer and as a
Class 4 insurer, and the Company is registered by the Bermuda
Minister of Finance as a long-term insurer, under the Bermuda
Insurance Act 1978, as amended, and any applicable rules and
regulations thereunder. Neither the Company nor Max Re Ltd. is
required to be licensed or admitted as an insurer or an
insurance holding company, as applicable, 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 their
respective businesses as described in the Prospectus. Max Re
Europe is not required to be licensed or admitted as an
insurer in, or otherwise to comply with, the Insurance Laws
of, any jurisdiction other than Ireland and the EU in order to
conduct its business as described in the Prospectus.
(aa) Each of the Company, Max Re Ltd. and
Max Re Europe possesses 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 it
as described in the Prospectus, except where the failure to
possess such Permits, singly or in the aggregate, would not
have a Material Adverse
8
Effect; all of such Permits are in full force and effect,
except where the failure to be in full force and effect,
singly or in the aggregate, would not have a Material Adverse
Effect; and there is no pending, contemplated or threatened
action, suit, proceeding, investigation or event against or
involving the Company, Max Re Ltd. or Max Re Europe (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
have a Material Adverse Effect. None of the Company, Max Re
Ltd. and Max Re Europe 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, Max Re Ltd. or Max Re Europe or that the Company, Max
Re Ltd. or Max Re Europe is not in compliance with any
applicable Insurance Law; and no such authority, commission or
body has issued any order or decree impairing, restricting or
prohibiting the continuation of the business of the Company,
Max Re Ltd. or Max Re Europe as currently conducted.
(bb) Each of the Company and Max Re Ltd. has
filed all statutory financial returns, reports, documents and
other information required to be filed pursuant to the
applicable Insurance Laws of Bermuda, and has duly paid all
taxes (including franchise taxes and similar fees) it is
required to have paid under the applicable Insurance Laws of
Bermuda, except where the failure, singly or in the aggregate,
to file such return, report, document or information or to pay
such taxes would not have a Material Adverse Effect; and each
of the Company and Max Re Ltd. maintains its books and records
in accordance with the applicable Insurance Laws of Bermuda,
except where the failure to so maintain its books and records,
singly or in the aggregate, would not have a Material Adverse
Effect. Max Re Europe has filed all statutory financial
returns, reports, documents and other information required to
be filed pursuant to the applicable Insurance Laws of Ireland
and the European Union, and has duly paid all taxes (including
franchise taxes and similar fees) it is required to have paid
under the applicable Insurance Laws of Ireland and the
European Union, except where the failure, singly or in the
aggregate, to file such return, report, document or
information or to pay such taxes would not have a Material
Adverse Effect; and Max Re Europe maintains its books and
records in accordance with the applicable Insurance Laws of
Ireland and the European Union, except where the failure to so
maintain its books and records, singly or in the aggregate,
would not have a Material Adverse Effect.
(cc) Except as disclosed in the Registration
Statement, all retrocessional and reinsurance treaties,
contracts and arrangements to which any of the Company's
subsidiaries is a party are in full force and effect and none
of the Company or any of its subsidiaries is in violation of,
or in default in the performance, observance or fulfillment
of, any obligation, agreement, covenant or condition contained
therein, except where the failure to be in full force and
effect and except where any such violation or default would
not, singly or in the aggregate, have a Material Adverse
Effect. None of the Company or any of its subsidiaries has
received any written notice that any of the other parties to
such treaties, contracts or agreements intends not to perform,
or will be unable to perform, in
9
any material respect such treaty, contract or agreement,
except where such non-performance would not, singly or in the
aggregate, have a Material Adverse Effect.
(dd) Any tax returns required to be filed by
the Company or any of its subsidiaries in any jurisdiction
have been filed and any material taxes, including any
withholding taxes, excise 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; Max Re Ltd. has filed protective U.S.
federal income tax returns for the year ended December 31,
2000.
(ee) The Company and Max Re Ltd. have
received from the Bermuda Minister of Finance an assurance
under The Exempted Undertakings Tax Protection Act, 1966 of
Bermuda to the effect set forth in the Prospectus under the
caption "Material Tax Considerations--Taxation of Max Re
Capital and its Subsidiaries--Bermuda", and the Company has
not received any notification to the effect (and is not
otherwise aware) that such assurance may be revoked or
otherwise not honored by the Bermuda government. There is no
Bermuda income, corporation or profits tax, withholding tax,
capital gains tax, estate duty or inheritance tax payable by
the Company, any of its subsidiaries or any Underwriter,
except where such Underwriter is ordinarily resident in
Bermuda or resident in Bermuda for exchange control purposes;
(ff) The Company and its subsidiaries 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 any of its subsidiaries 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.
(gg) 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; and no
registration, documentary, recording, transfer or other
similar tax, fee or charge by any Bermuda government authority
is payable in connection with the execution, delivery, filing,
registration or performance of this Agreement.
(hh) 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 as may apply to residents of Bermuda
for Bermuda exchange control purposes) or (ii) by the any of
the Company's subsidiaries to the Company. The Bermuda
Monetary Authority has designated the Company and Max Re Ltd.
as nonresident for exchange control purposes and has granted
permission for the issue and transfer of the Shares (including
permission for the issue or transfer of up to 20% of the
Company's shares in issue from time to time to persons
resident in Bermuda for exchange control purposes), subject to
the condition that the Common Shares of the Company shall be
listed on the NASDAQ National Market System or any other
appointed stock exchange. Such permission has not been revoked
and is in full force and
10
effect, and the Company is not aware of any proceedings
planned or threatened for the revocation of such permission.
The Company and Max Re Ltd. are "exempted companies" under
Bermuda law and have not (i) acquired and do not hold any land
in Bermuda, other than that held by way of lease or tenancy
for terms of not more than 21 years, without the express
authorization of the Bermuda legislature, (ii) taken mortgages
on land in Bermuda to secure an amount in excess of $50,000,
without the consent of the Bermuda Minister of Finance, (iii)
acquired any bonds or debentures secured by any land in
Bermuda (other than certain types of Bermuda government
securities), or (iv) conducted their business in a manner that
is prohibited for "exempted companies" under Bermuda law.
Neither the Company nor Max Re Ltd. has received notification
from the Bermuda Monetary Authority or any other Bermuda
governmental authority of proceedings relating to the
modification or revocation of its designation as nonresident
for exchange control purposes, its permission to issue and
transfer the Shares, or its status as an "exempted company."
(ii) Neither the Company nor any of its
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, neither the Company nor any of its
subsidiaries have distributed, and none of them will
distribute, prior to the later to occur of (i) the Closing
Date or the Option Closing Date 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.
(jj) Neither the Company nor any of its
subsidiaries nor any of its or their properties or assets has
any immunity from the jurisdiction of any court or from any
legal process (whether through service or notice, attachment
prior to judgment, attachment in aid of execution or
otherwise) under the laws of Bermuda.
(kk) The Company has validly and irrevocably
submitted to the nonexclusive jurisdiction of any New York
Court (as defined below) with respect to suits, actions or
proceedings arising out of or in connection with violations of
United States federal securities laws relating to offers and
sales of the Shares, has validly and irrevocably waived, to
the fullest extent permitted by law, any objections that it
may now or hereafter have to the laying of venue of any such
suit, action or proceeding brought in any New York Court based
on or arising under this Agreement or any claims that any such
suit, action or proceeding brought in any New York Court has
been brought in an inconvenient forum, and has duly and
irrevocably appointed CT Corporation System as its agent to
receive service of process with respect to actions arising out
of or in connection with any such suit, action or proceeding;
and service of process effected in the manner set forth in
Section 10 of this Agreement will be effective under the laws
of Bermuda to confer personal jurisdiction over the Company.
(ll) The Company has not offered, or caused
the Underwriters to offer, Shares to any person pursuant to
the Directed Share Program with the specific intent to
11
unlawfully influence (i) a customer or supplier of the Company
to alter the customer's or supplier's level or type of
business with the Company, or (ii) a trade journalist or
publication to write or publish favorable information about
the Company or its products.
(mm) Furthermore, the Company represents and
warrants that (i) the Registration Statement, the Prospectus
and any preliminary prospectus comply, and any further
amendments or supplements thereto will comply, with any
applicable laws or regulations of foreign jurisdictions in
which the Prospectus or any preliminary prospectus, as amended
or supplemented, if applicable, are distributed in connection
with the Directed Share Program, and that (ii) no
authorization, approval, consent, license, order, registration
or qualification of or with any government, governmental
instrumentality or court, other than such as have been
obtained, is necessary under the securities laws and
regulations of foreign jurisdictions in which the Directed
Shares are offered outside the United States.
(nn) The form of Shareholders' Agreement
filed with the Commission as Exhibit 10.1 to the Registration
Statement is a true and correct copy of the Shareholders'
Agreement dated as of December 22, 1999 by and among Maximus
Capital Holdings, Ltd., Max Re Ltd. and each of the other
signatories thereto (the "Shareholders' Agreement"), which
Shareholders' Agreement is in full force and effect as of the
execution of this Agreement.
(oo) Attached hereto as Exhibit A-1 is a
true and correct copy of the Instructions (as defined below)
which have been delivered by the Company to its transfer agent
on or prior to the date hereof and which Instructions are in
full force and effect as of the execution of this Agreement.
(pp) Attached hereto as Exhibit A-2 is a
true and correct copy of Section 5 of the subscription
agreement entered into between the Company and each current
shareholder of the Company (with the exception of Bayerische
Hypo- und Vereinsbank ("HVB"), which entered into a stock
purchased agreement with the Company containing substantially
similar language), and Section 5 of each such subscription
agreement, and the analagous provision in the stock purchase
agreement with respect to HVB (together with Section 5, the
"Section 5 Provisions"), is in full force and effect as of the
execution of this Agreement.
2. Agreements to Sell and Purchase. The Company 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
Company the respective numbers of Firm Shares set forth in Schedule I hereto
opposite its name at $______ a share (the "Purchase Price").
On the basis of the representations and warranties contained
in this Agreement, and subject to its terms and conditions, the Company 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
_______________ Additional Shares at the Purchase Price. If you, on behalf of
the Underwriters, elect to exercise such option, you shall so notify the Company
in writing not
12
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 4 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.
The Company hereby agrees that, without the prior written
consent of Xxxxxx Xxxxxxx & Co. Incorporated ("Xxxxxx Xxxxxxx") and Xxxxxxx
Xxxxx Xxxxxx on behalf of the Underwriters, it will not, and will cause its
subsidiaries not to, during the period ending 180 days after the date of the
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, any securities convertible
into or exercisable or exchangeable for Common Stock or any securities
convertible into or exercisable or exchangeable for any such securities 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. The foregoing sentence shall not apply to (A) the Shares to be sold
hereunder, (B) the issuance by the Company or Max Re Ltd. of shares of Common
Stock or securities convertible into or exercisable or exchangeable for Common
Stock upon the exercise of an option or warrant or the conversion of a security
outstanding on the date hereof of which the Underwriters have been advised in
writing or (C) the issuance by the Company or Max Re Ltd. of warrants to acquire
Common Stock or securities convertible into or exercisable or exchangeable for
shares of Common Stock pursuant to contractual agreements in effect on the date
hereof of which the Underwriters have been advised in writing.
3. Terms of Public Offering. The Company is advised by you
that the Underwriters propose to make a public offering of their respective
portions of the Shares as soon after the Registration Statement and this
Agreement have become effective as in your judgment is advisable. The Company is
further advised by you that the Shares are to be offered to the public initially
at $_____________ a share (the "Public Offering Price") and to certain dealers
selected by you at a price that represents a concession not in excess of $______
a share under the Public Offering Price, and that any Underwriter may allow, and
such dealers may reallow, a concession, not in excess of $_____ a share, to any
Underwriter or to certain other dealers.
4. Payment and Delivery. Payment for the Firm Shares shall be
made to the Company 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 ____________, 2001 or
at such other time on the same or such other date, not later than _________,
2001 as shall be designated in writing by you. The time and date of such payment
are hereinafter referred to as the "Closing Date".
13
Payment for any Additional Shares shall be made to the Company
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 2 or at such other time on the same or on such other
date, in any event not later than _______, 2001 as shall be designated in
writing by you. The time and date of such payment are hereinafter referred to as
the "Option Closing Date".
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
respective accounts 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.
5. Conditions to the Underwriters' Obligations. The
obligations of the Company to sell the Shares to the Underwriters and the
several obligations of the Underwriters to purchase and pay for the Shares on
the Closing Date are subject to the condition that the Registration Statement
shall have become effective not later than [_____] (New York City time) on the
date hereof.
The several obligations of the Underwriters are subject to the
following further conditions:
(a) 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 Max Re Ltd. by any
"nationally recognized statistical rating organization," as
such term is defined for purposes of Rule 436(g)(2) under the
Securities Act, A.M. Best Company, Inc. or Fitch, Inc.; 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, operations or properties of the Company and its
subsidiaries, taken as a whole, whether or not arising from
transactions in the ordinary course of business, from that set
forth in the 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 or inadvisable to market
the Shares on the terms and in the manner contemplated in the
Prospectus.
(b) 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 5(a)(i) above and to the effect that (i)
the representations
14
and warranties of the Company contained in this Agreement are
true and correct as of the Closing Date, (ii) no stop order
suspending the effectiveness of the Registration Statement is
in effect and no proceedings for such purpose are pending
before or threatened by the Commission and (iii) the Company
has complied in all material respects 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.
The officer signing and delivering such certificate may rely
upon the best of his or her knowledge as to proceedings threatened.
(c) The Underwriters shall have received on
the Closing Date an opinion of Xxxx, Xxxx, Xxxxxxx, Xxxxx &
Xxxx, L.L.P., outside counsel for the Company, dated the
Closing Date, to the effect that:
(i) except as described in the Prospectus,
there are no limits, whether direct or indirect, under any
provision of law of the United States, or the State of New
York, under any agreement or other instrument governed by New
York law and filed as an exhibit to the Registration Statement
that is binding upon the Company or any of its subsidiaries or
any of their properties, or under any judgment, order or
decree of any United States federal or New York State
governmental body, agency or court having jurisdiction over
the Company or any of its subsidiaries, 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 transfer any of such subsidiary's property or assets to the
Company or any other subsidiary of the Company;
(ii) [to the knowledge of the lawyers at
such counsel who have participated in the representation of
the Company], neither the Company nor any of its subsidiaries
is 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
filed as an exhibit to the Registration Statement;
(iii) except as set forth in the Prospectus,
[to the knowledge of the lawyers at such counsel who have
participated in the representation of the Company], there are
no outstanding options, warrants or other rights calling for
the issuance of, and there are no commitments, plans or
arrangements to issue, any shares of capital stock of the
Company or any of its subsidiaries or any security convertible
into or exchangeable or exercisable for any shares of capital
stock of the Company or any of it subsidiaries; and the form
of certificates for the Shares conforms to the requirements of
the Nasdaq National Market;
(iv) 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 applicable United States federal or New York
State law or, to the best of such counsel's knowledge, any
agreement or other instrument binding upon the Company or any
of its subsidiaries that is material to
15
the Company and its subsidiaries, taken as a whole, or, to the
best of such counsel's knowledge, any judgment, order or
decree of any United States federal or New York State
governmental body, agency or court having jurisdiction over
the Company or any subsidiary, and no consent, approval,
authorization or order of, or qualification with, any United
States federal or New York State 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 or Blue Sky laws or insurance
securities laws of the various states in connection with the
offer and sale of the Shares;
(v) [to the knowledge of the lawyers at such
counsel who have participated in the representation of the
Company], there are no United States federal or New York State
legal or governmental proceedings pending or threatened to
which the Company or any of its subsidiaries is a party or to
which any of the properties of the Company or any of its
subsidiaries is subject that are required to be described in
the Registration Statement or the Prospectus and are not so
described or of any United States federal or New York State
statutes or regulations or any contracts or other documents
that are required to be described in the Registration
Statement or the Prospectus or to be filed as exhibits to the
Registration Statement that are not described or filed as
required;
(vi) each preliminary prospectus filed as
part of the Registration Statement as originally filed or as
part of any amendment thereto, or filed pursuant to Rule 424
under the Securities Act, complied as to form when so filed in
all material respects with the Securities Act and the
applicable rules and regulations of the Commission thereunder;
(vii) except as described in the Prospectus,
[to the knowledge of the lawyers at such counsel who have
participated in the representation of the Company], 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;
(viii) the statements (A) in the Prospectus
under the captions "Regulation--United States",
["Management",] "Principal Shareholders", "Certain
Relationships and Related Party Transactions", "Material Tax
Considerations--Taxation of Max Re Capital and its
Subsidiaries--United States", "Material Tax Considerations--
Taxation of Shareholders--United States Taxation of U.S.
Shareholders", "Shares Eligible for Future Sale" and
"Underwriters" (but only with respect to the statements under
the caption "Underwriters" summarizing the Underwriting
Agreement), (B) in the parts of the Prospectus identified in
Schedule II hereto and (C) in the Registration Statement in
Items 14 and 15, in each case insofar as such statements
constitute summaries of the legal matters, documents or
proceedings referred to therein, fairly present
16
the information called for with respect to such legal matters,
documents and proceedings and fairly summarize the matters
referred to therein;
(ix) neither the Company nor Max Re Ltd. is
required to be licensed or admitted as an insurer or an
insurance holding company, as applicable, in, or otherwise to
comply with the Insurance Laws of, the State of New York in
order to conduct their respective businesses as described in
the Prospectus;
(x) the Registration Statement and
Prospectus (except for financial statements and schedules and
other financial and statistical data included 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;
(xi) the Company and each of its
subsidiaries is not and, after giving effect to the offering
and sale of the Shares and the application of the proceeds
thereof as described in the Prospectus, will not be required
to register as an "investment company" as such term is defined
in the Investment Company Act.
Such counsel may also state that they have not made any
independent verification or check, and are not passing upon and do not assume
any responsibility for, the accuracy, completeness or fairness of the statements
contained in the Registration Statement and Prospectus, other than those
mentioned above, but such counsel shall confirm that they have, however,
participated in reviews and discussions in connection with the preparation of
the Registration Statement and Prospectus prior to the Closing Date, and in the
course of such reviews and discussions (relying as to matters of fact upon
statements of officers and other representatives of the Company) no facts came
to their attention that led them to believe that (x) the Registration Statement
and the Prospectus included therein at the time the Registration Statement
became effective (in each case, apart from the financial statements and
schedules and other financial and statistical data contained therein or omitted
therefrom as to which such counsel need not express any opinion) contained any
untrue statement of a material fact or omitted to state any material fact
required to be stated therein or necessary to make the statements therein not
misleading or (y) the Prospectus (apart from the financial statements and
schedules and other financial and statistical data contained therein or omitted
therefrom as to which such counsel need not express any opinion) contains any
untrue statement of a material fact or omits 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.
(d) The Underwriters shall have received on
the Closing Date an opinion of Xxxxxxx Xxxx & Xxxxxxx, outside
Bermuda counsel for the Company, dated the Closing Date, to
the effect that:
(i) each of the Company, Max Re Ltd. and Max
Re Managers Ltd. has been duly formed, is validly existing as
a corporation in good standing under the laws of Bermuda and
has the corporate power and authority to own its property
17
and to conduct its business as described in the Prospectus and
is duly qualified to transact business and is in good standing
in Bermuda;
(ii) all of the issued shares of capital
stock of Max Re Ltd. and Max Re Managers Ltd. have been duly
and validly authorized and issued, are fully paid and
non-assessable, and all of the issued shares of capital stock
of Max Re Managers Ltd., and all of the issued shares of
voting capital stock of Max Re Ltd. are owned directly by the
Company, free and clear of all liens, encumbrances, equities
or claims; and the shares representing a 7.5% interest in
Grand Central Re Limited are owned by the Company indirectly
through Max Re Ltd., free and clear of all liens,
encumbrances, equities or claims;
(iii) except as described in the Prospectus,
there are no limits, whether direct or indirect, under any
provision of applicable law, under the memorandum of
association or bye-laws or other organizational document of
Max Re Ltd. and Max Re Managers Ltd., under any agreement or
other instrument binding upon the Company or any of its
subsidiaries or any of their properties, or under any
judgment, order or decree of any Bermuda governmental body,
agency or court having jurisdiction over the Company or any of
its subsidiaries, on the ability of Max Re Ltd. or Max Re
Managers (i) to pay any dividends to the Company, (ii) to make
any other distribution on its capital stock, (iii) to repay to
the Company any loans or advances to it from the Company or
(iv) to transfer any of its property or assets to the Company
or any other subsidiary of the Company;
(iv) the authorized capital stock of the
Company conforms as to legal matters to the description
thereof contained in the Prospectus;
(v) the shares of Common Stock outstanding
prior to the issuance of the Shares have been duly authorized
and are validly issued, fully paid (except to the extent that
shares of Common Stock purchased by certain executives of the
Company that were financed by Company loans, as is described
in the Prospectus under the caption "Certain Relationships and
Related Transactions -- Loans to Management," could be deemed
not to be fully paid) and non-assessable;
(vi) the Shares have been duly authorized
and, when issued and delivered in accordance with the terms of
this Agreement, will be validly issued, fully paid and
non-assessable, and the issuance of such Shares will not be
subject to any preemptive or similar rights, except to the
extent that the right of certain strategic investors and the
Chief Executive Officer to receive warrants upon the issuance
of equity by the Company, as is described in the Prospectus
under the caption "Capital Stock -- Warrants," could be deemed
to be a preemptive or similar right;
(vii) the Company has the necessary
corporate power and authority to enter into and perform its
obligations under this Agreement and to issue the Shares and
has taken all necessary corporate action required to authorize
the execution, delivery and performance of this Agreement;
18
(viii) this Agreement has been duly
authorized, executed and delivered by the Company;
(ix) to the best of such counsel's
knowledge, neither the Company nor Max Re Ltd. nor Max Re
Managers is in violation of its memorandum of association or
bye-laws, and neither the Company nor any of its subsidiaries
is 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
filed as an exhibit to the Registration Statement;
(x) the form of certificates for the Shares
conforms to the requirements of the laws of Bermuda;
(xi) 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 applicable law or the memorandum of association
or bye-laws of the Company or, to the best of such counsel's
knowledge, any agreement or other instrument binding upon the
Company or any of its subsidiaries that is material to the
Company and its subsidiaries, taken as a whole, or, to the
best of such counsel's knowledge, any judgment, order or
decree of any governmental body, agency or court of Bermuda
having jurisdiction over the Company or any subsidiary, and no
consent, approval, authorization or order of, or qualification
with, any Bermuda governmental body or agency is required for
the performance by the Company of its obligations under this
Agreement, except such as may be required and have been
obtained from the Bermuda Monetary Authority;
(xii) after due inquiry, such counsel does
not know of any legal or governmental proceedings pending or
threatened in Bermuda to which the Company or any of its
subsidiaries is a party or to which any of the properties of
the Company or any of its subsidiaries is subject that are
required to be described in the Registration Statement or the
Prospectus and are not so described or of any statutes,
regulations, contracts or other documents that are required to
be described in the Registration Statement or the Prospectus
or to be filed as exhibits to the Registration Statement that
are not described or filed as required;
(xiii) based solely on a search of the
Register of Charges, maintained by the Register of Companies
pursuant to Section 55 of the Companies Act 1981, conducted on
[________], 2001, there are no registered charges registered
against the Company or, Max Re Ltd. or Max Re Managers;
(xiv) the statements (A) in the Prospectus
under the captions "Risk Factors", "Management's Discussion
and Analysis of Financial Condition and Results of
Operations", "Business", "Regulation", "Management",
"Principal Shareholders", "Certain Relationships and Related
Party Transactions", "Description of Capital Stock", "Shares
Eligible for Future Sale" and "Enforceability of Civil
Liabilities Under United States Federal Securities Laws"
19
and (B) in the Registration Statement in Items 14 and 15, in
each case 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;
(xv) Max Re Ltd. is duly registered by the
Bermuda Minister of Finance as a long-term insurer and as a
Class 4 insurer, and the Company is duly registered by the
Bermuda Minister of Finance as a long-term insurer, under the
Bermuda Insurance Act 1978, as amended, and any applicable
rules and regulations thereunder;
(xvi) there is no Bermuda income,
corporation or profits tax, withholding tax, capital gains
tax, estate duty or inheritance tax payable by the Company,
Max Re Ltd., Max Re Managers or any Underwriter, except where
such Underwriter is ordinarily resident in Bermuda for
exchange control purposes;
(xvii) 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; and no
registration, documentary, recording, transfer or other
similar tax, fee or charge by any Bermuda government authority
is payable in connection with the execution, delivery, filing,
registration or performance of this Agreement;
(xviii) 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 as may apply to
residents of Bermuda for Bermuda exchange control purposes) or
(ii) by Max Re Ltd. or Max Re Managers to the Company; the
Bermuda Monetary Authority has designated the Company and Max
Re Ltd. as nonresident for exchange control purposes and has
granted permission for the issue and transfer of the Shares.
The Company and Max Re Ltd. are "exempted companies" under
Bermuda law;
(xix) the Underwriters will not be deemed to
be resident, domiciled or carrying on business in Bermuda by
reason only of the execution, performance and enforcement of
this Agreement;
(xx) neither the Company nor any of its
subsidiaries nor any of its or their properties or assets has
any immunity from the jurisdiction of any court or from any
legal process (whether through service or notice, attachment
prior to judgment, attachment in aid of execution or
otherwise) under the laws of Bermuda;
(xxi) each of the Underwriters has standing
to bring an action or proceeding before the appropriate courts
in Bermuda for the enforcement of this Agreement; it is not
necessary or advisable in order for any Underwriter to
20
enforce its rights under this Agreement, including the
exercise of remedies thereunder, that such Underwriter be
licensed, qualified or otherwise entitled to carry on business
in Bermuda; and it is not necessary or advisable to ensure the
enforceability in Bermuda of this Agreement that this
Agreement be registered in any register kept by, or filed
with, any governmental authority or regulatory body in
Bermuda;
(xxii) the Company has validly and
irrevocably submitted to the nonexclusive jurisdiction of any
New York Court (as defined below) with respect to suits,
actions or proceedings arising out of or in connection with
violations of United States federal securities laws relating
to offers and sales of the Shares, has validly and irrevocably
waived, to the fullest extent permitted by law, any objections
that it may now or hereafter have to the laying of venue of
any such suit, action or proceeding brought in any New York
Court based on or arising under this Agreement or any claims
that any such suit, action or proceeding brought in any New
York Court has been brought in an inconvenient forum, and has
duly and irrevocably appointed CT Corporation System as its
agent to receive service of process with respect to actions
arising out of or in connection with any such suit, action or
proceeding; service of process effected in the manner set
forth in Section 10 of this Agreement will be effective under
the laws of Bermuda to confer personal jurisdiction over the
Company; and the choice of New York law as the governing law
of this Agreement is a valid and effective choice of law;
(xxiii) the courts of Bermuda would
recognize as a valid judgment, a final and conclusive judgment
in personam obtained in any New York Court against the Company
based on 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 New York Court had proper
jurisdiction over the parties subject to such judgment, (B)
such New York Court did not contravene the rules of natural
justice of Bermuda, (C) such judgment was not obtained by
frauds, (D) the enforcement of such 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) the due compliance with the correct procedures under the
laws of Bermuda; and such counsel is not aware of any reason
why the enforcement of such a judgment would be contrary to
the public policy of Bermuda; and
(xxiv) the restrictions on transfer of
shares of Common Stock [and the requirements for compulsory
surrender of shares of Common Stock] provided in the Company's
bye-laws are valid and enforceable under Bermuda law.
Such opinion may contain customary assumptions, exceptions,
limitations and qualifications, [including, without limitation, qualifications
as to enforceability.]
21
(e) The Underwriters shall have received on the Closing Date
an opinion of A&L Goodbody, outside Irish counsel for the Company, dated the
Closing Date, to the effect that:
(i) Max Re Europe has been duly
incorporated, is validly existing as a corporation in good
standing under the laws of Ireland and has the corporate power
and authority to own its property and to conduct its business
as described in the Prospectus and is duly qualified to
transact business and no steps have been taken or are being
taken to appoint a receiver, examiner or liquidator over it or
to wind it up;
(ii) all of the issued shares of capital
stock of Max Re Europe have been duly and validly authorized
and issued, are fully paid and not subject to calls for any
additional payments and are registered in the name of Max Re
Ltd., and, to the best of such counsel's knowledge, are free
and clear of all liens, encumbrances, equities or claims;
(iii) except as described in the Prospectus,
there are no limits, whether direct or indirect, under any
provision of applicable Irish law or under the Memorandum and
Articles of Association of Max Re Europe, and, to the best of
such counsel's knowledge, under any agreement or other
instrument binding upon Max Re Europe or any of its
properties, or under any judgment, order or decree of any
Irish governmental body, agency or court having jurisdiction
over Max Re Europe, on the ability of Max Re Europe (i) to pay
any dividends to Max Re Ltd., (ii) to make any other
distribution on its capital stock, (iii) to repay to Max Re
Ltd. any loans or advances to it from Max Re Ltd. or (iv) to
transfer any of its property or assets to Max Re Ltd. or any
other subsidiary of Max Re Ltd.;
(iv) 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 applicable Irish law or, to the best of such
counsel's knowledge, any judgment, order or decree of any
governmental body, agency or court of Ireland having
jurisdiction over Max Re Europe, and no consent, approval,
authorization or order of, or qualification with, any Irish
governmental body or agency is required for the performance by
the Company of its obligations under this Agreement;
(v) after due inquiry, such counsel does not
know of any legal or governmental proceedings pending or
threatened in Ireland to which Max Re Europe is a party or to
which any of the properties of Max Re Europe is subject that
are required to be described in the Registration Statement or
the Prospectus and are not so described;
(vi) the statements in the Prospectus under
the captions "Risk Factors--Risks Related to Regulation,"
"Regulation--Ireland" and "Material Tax
Considerations--Taxation of Max Re Capital and its
Subsidiaries--Ireland," insofar as such statements constitute
summaries of the legal matters, documents or
22
proceedings referred to xxxxxxx, fairly present the
information called for with respect to such legal matters,
documents and proceedings and fairly summarize the matters
referred to therein;
(vii) Max Re Europe has made the appropriate
notification under the Insurance Act, 2000 to the Minister for
Enterprise, Trade & Employment and has received the
appropriate acknowledgement to entitle the Company to carry on
reinsurance business; and
(viii) Max Re Europe has filed all statutory
financial returns, reports, documents and other information
required to be filed pursuant to the applicable Insurance Acts
of Ireland, except where the failure, singly or in the
aggregate, to file such return, report, document or
information or to pay such taxes would not have a Material
Adverse Effect; and Max Re Europe maintains its books and
registers required in the Companies Acts 1963 to 1999 of
Ireland in accordance with those Acts, except where the
failure to so maintain its books and records, singly or in the
aggregate, would not have a Material Adverse Effect.
(f) The Underwriters shall have received on the Closing Date
an opinion of Xxxxxx, Xxxxxxxx & Co., outside Bahamian counsel for the Company,
dated the Closing Date, to the effect that:
(i) MDS has been duly incorporated, is
validly existing as a corporation in good standing under the
laws of the Bahamas and has the corporate power and authority
to own its property and to conduct its business as described
in the Prospectus and is duly qualified to transact business
and is in good standing in the Bahamas and there is no
petition or resolution for the winding up of MDS on file at
the Companies Registry in The Bahamas;
(ii) all of the issued shares of capital
stock of MDS have been duly and validly authorized and issued,
are fully paid and non-assessable and are owned directly by
Max Re Ltd., and, to the best of such counsel's knowledge, are
free and clear of all liens, encumbrances, equities or claims;
(iii) except as described in the Prospectus,
there are no limits, whether direct or indirect, under any
provision of applicable law, under the Memorandum or Articles
of Association of MDS, under any agreement or other instrument
binding upon MDS or any of their properties, or under any
judgment, order or decree of any Bahamas governmental body,
agency or court having jurisdiction over MDS, on the ability
of MDS (i) to pay any dividends to the Company, (ii) to make
any redemptions of its capital stock, (iii) to repay to the
Company any loans or advances to it from the Company or (iv)
to transfer any of its property or assets to the Company or
any other subsidiary of the Company, where such dividends and
redemptions referred to in clauses (i) and (ii) are the only
permitted distributions on the capital stock of MDS pursuant
to Bahamian law;
23
(iv) to the best of such counsel's
knowledge, MDS is not in violation of its Memorandum or
Articles of Association;
(v) 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 applicable law or, to the best of such counsel's
knowledge, any agreement governed by Bahamian law filed as an
exhibit to the Registration Statement, or, to the best of such
counsel's knowledge, any judgment, order or decree of any
governmental body, agency or court of the Bahamas having
jurisdiction over MDS, and no consent, approval, authorization
or order of, or qualification with, any Bahamas governmental
body or agency is required for the performance by the Company
of its obligations under this Agreement;
(vi) after due inquiry, such counsel does
not know of any legal or governmental proceedings pending or
threatened in The Bahamas to which MDS is a party or to which
any of the properties of MDS is subject and there are no
outstanding judgments or proceedings commenced against MDS
before the courts of The Bahamas;
(vii) MDS is not entitled or required under
any existing applicable law or regulation of The Bahamas to
make any withholding or deduction in respect of any tax or
otherwise from any payment which it is or may be required to
make by way of dividend or other distribution; and
(viii) MDS qualifies as an exempt mutual
fund under the provisions of the Mutual Funds Act of The
Bahamas, and as a result it is not required to be licensed by
the Securities Commission of The Bahamas and MDS is not in
violation of any governmental reporting requirements in
respect of such status.
(g) The Underwriters shall have received on the Closing Date
an opinion of XxXxxxx, Xxxx, Xxxxxx & XxxXxx, L.L.P., United States counsel for
the Underwriters, dated the Closing Date, covering the matters referred to in
Sections 5(c)(vii) (but only as to the statements in the Prospectus under
"Underwriters") and 5(c)(x) and the final paragraph of 5(c) above and an opinion
of Xxxxxxx Xxxxxxxx & Xxxxx, Bermuda counsel for the Underwriters, dated the
Closing Date, covering the matters referred to in Sections [5(d)(vi), 5(d)(viii)
and 5(d)(xiv)] (but only as to the statements in the Prospectus under
"Description of Capital Stock") above.
The opinions of Xxxx, Xxxx, Xxxxxxx, Xxxxx & Xxxx, L.L.P.,
Xxxxxxx Xxxx & Xxxxxxx, A&L Xxxxxxxx and Xxxxxx, Xxxxxxxx & Co. described in
Sections 5(c), 5(d), 5(e) and 5(f) above shall be rendered to the Underwriters
at the request of the Company and shall so state therein.
(h) 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 public accountants, containing statements and information of
the type ordinarily included in
24
accountants' "comfort letters" to underwriters with respect to the financial
statements and certain financial information contained in the Registration
Statement and the Prospectus; provided that the letter delivered on the Closing
Date shall use a "cut-off date" not earlier than the date hereof.
(i) The "lock-up" agreements, each substantially in the form
of Exhibit B hereto, between you and certain shareholders, officers and
directors of the Company, and in the form of Exhibit C hereto, between you and
certain shareholders, relating to sales and certain other dispositions of shares
of Common Stock or certain 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, the due authorization and issuance of the
Additional Shares and other matters related to the issuance of the Additional
Shares.
6. Covenants of the Company. In further consideration of the
agreements of the Underwriters herein contained, the Company covenants with each
Underwriter as follows:
(a) To furnish to you, without charge, [6]
signed copies of the Registration Statement (including
exhibits thereto) and for delivery to each other Underwriter a
conformed copy of the Registration Statement (without exhibits
thereto) and to furnish to you in New York City, without
charge, prior to 10:00 a.m. New York City time on the business
day next succeeding the date of this Agreement and during the
period mentioned in Section 6(c) below, as many copies of the
Prospectus and any supplements and amendments thereto or to
the Registration Statement as you may reasonably request.
(b) Before amending or supplementing the
Registration Statement or the Prospectus, to furnish to you a
copy of each such proposed amendment or supplement and not to
file any such proposed amendment or supplement to which you
reasonably object, and to file with the Commission within the
applicable period specified in Rule 424(b) under the
Securities Act any prospectus required to be filed pursuant to
such Rule.
(c) If, during such period after the first
date of the public offering of the Shares as in the opinion of
counsel for the Underwriters the Prospectus is required by law
to be delivered in connection with sales by an Underwriter or
dealer, any event shall occur or condition exist as a result
of which it is necessary to amend or supplement the Prospectus
in order to make the statements therein, in the light of the
circumstances when the Prospectus is delivered to a purchaser,
not misleading, or if, in the opinion of counsel for the
Underwriters, it is necessary to amend or supplement the
Prospectus to comply with applicable law, forthwith to
prepare, file with the Commission and furnish, at its own
expense, to the Underwriters and to the dealers (whose names
and addresses you will furnish to the Company) to which Shares
may have been sold by you on behalf of the Underwriters and to
any other dealers upon request, either amendments or
supplements to
25
the Prospectus so that the statements in the Prospectus as so
amended or supplemented will not, in the light of the
circumstances when the Prospectus is delivered to a purchaser,
be misleading or so that the Prospectus, as amended or
supplemented, will comply with law.
(d) To endeavor to qualify the Shares for offer and sale under
the securities or Blue Sky laws of such jurisdictions as you shall reasonably
request; 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 material taxation or service of process in
suits, other than those arising out of the offering or sale of shares of the
Common Stock, in any jurisdiction where it is not now so subject.
(e) To make generally available (within the meaning of Section
11(a) of the Securities Act) to the Company's security holders and to you as
soon as practicable, but not later than 45 days after the end of its fiscal
quarter in which the first anniversary date of the effective date of the
Registration Statement occurs, an earnings statement (in form complying with the
provisions of Rule 158 under the Securities Act) covering a period of at least
12 consecutive months beginning after the effective date of the Registration
Statement.
(f) Whether or not the transactions contemplated in this
Agreement are consummated or this Agreement is terminated, to pay or cause to be
paid all expenses incident to the performance of its obligations under this
Agreement, including: (i) the fees, disbursements and expenses of the Company's
counsel and the Company's accountants in connection with the registration and
delivery of the Shares under the Securities Act and all other fees or expenses
in connection with the preparation and filing of the Registration Statement, any
preliminary prospectus, the Prospectus and amendments and supplements to any of
the foregoing, including all printing costs associated therewith, and the
mailing and delivering of copies thereof to the Underwriters and dealers, in the
quantities hereinabove specified, (ii) all costs and expenses related to the
transfer and delivery of the Shares to the Underwriters, including any transfer
or other taxes payable thereon, (iii) the cost of printing or producing any Blue
Sky or Legal Investment memorandum in connection with the offer and sale of the
Shares under state securities laws and all expenses in connection with the
qualification of the Shares for offer and sale under state securities laws as
provided in Section 6(d) hereof, including filing fees and the reasonable fees
and disbursements of counsel for the Underwriters in connection with such
qualification and in connection with the Blue Sky or Legal Investment memorandum
(such fees and disbursements of counsel not to exceed $10,000), (iv) all filing
fees and the reasonable fees and disbursements of counsel to the Underwriters
(including without limitation any fees and disbursements of counsel incurred on
behalf of, and other disbursements of, Xxxxxx Xxxxxxx in Xxxxxx Xxxxxxx'x
capacity as "qualified independent underwriter" in connection with the offering
of the Shares) incurred in connection with the review and qualification of the
offering of the Shares by the National Association of Securities Dealers, Inc.,
(v) all fees and expenses in connection with the preparation and filing of the
registration statement on Form 8-A relating to the Common Stock and all costs
and expenses incident to listing the Shares on the Nasdaq National Market, (vi)
the cost of printing certificates representing the Shares,
26
(vii) the costs and charges of any transfer agent, registrar or depositary,
(viii) the costs and expenses of the Company relating to investor presentations
on any "road show" undertaken in connection with the marketing of the offering
of the Shares, including, without limitation, expenses associated with the
production of road show slides and graphics, fees and expenses of any
consultants engaged in connection with the road show presentations with the
prior approval of the Company, travel and lodging expenses of the
representatives and officers of the Company and any such consultants (excluding
the Underwriters), and the cost of any aircraft chartered in connection with the
road show, (ix) all other costs and expenses incident to the performance of the
obligations of the Company hereunder for which provision is not otherwise made
in this Section, and (x) all fees and disbursements of counsel incurred by the
Underwriters in connection with the Directed Share Program (such fees, exclusive
of any fees incurred due to legal work conducted by Company counsel in Ireland,
A&L Goodbody, not to exceed $25,000) and stamp duties, similar taxes or duties
or other taxes, if any, incurred by the Underwriters in connection with the
Directed Share Program. It is understood, however, that except as provided in
this Section, Section 7 entitled "Indemnity and Contribution", and the last
paragraph of Section 8 below, the Underwriters will pay all of their costs and
expenses, including fees and disbursements of their counsel, stock transfer
taxes payable on resale of any of the Shares by them and any advertising
expenses connected with any offers they may make.
(g) In connection with the Directed Share Program, to ensure
that the Directed Shares will be restricted to the extent required by the
National Association of Securities Dealers, Inc. (the "NASD") or the NASD rules
from sale, transfer, assignment, pledge or hypothecation for a period of three
months following the date of the effectiveness of the Registration Statement.
Xxxxxxx Xxxxx Xxxxxx will notify the Company as to which Participants will need
to be so restricted. The Company will direct the removal of such transfer
restrictions upon the expiration of such period of time.
Furthermore, the Company covenants with Xxxxxxx Xxxxx Xxxxxx
that the Company will comply with all applicable securities and other applicable
laws, rules and regulations in each jurisdiction in which the Directed Shares
are offered in connection with the Directed Share Program.
(h) The Company acknowledges and agrees that, unless it has
received the prior written consent of Xxxxxx Xxxxxxx and Xxxxxxx Xxxxx Xxxxxx,
it will not (i) for a 180-day period commencing on the date that the
Registration Statement became effective, amend, modify or otherwise change any
provision of the Shareholders' Agreement or the Section 5 Provisions which
imposes a restriction on, or otherwise limits, the transferability of securities
owned or otherwise held by any party thereto, including, without limitation,
Section 7 of the Shareholders' Agreement (such restrictions and limitations
being referred to as "Transfer Restrictions"), (ii) with respect to any
shareholder of the Company who has not delivered a "lock-up" agreement pursuant
to Section 5(i) hereof, consent to the transfer of any securities subject to the
Transfer Restrictions owned or otherwise held by any party to the Shareholders'
Agreement, and (iii) with respect to any shareholder of the Company who has not
delivered a "lock-up" agreement pursuant to Section 5(i) hereof, waive the
obligation of any party to the
27
Shareholders' Agreement to comply with the Transfer Restrictions unless Xxxxxx
Xxxxxxx and Xxxxxxx Xxxxx Xxxxxx have previously released such securities or
such party from the Transfer Restrictions with respect to the contemplated
transfer in writing. The Company acknowledges and agrees that it has on or prior
to the date hereof instructed its transfer agent in writing (the "Instructions")
to (i) not register for transfer any securities which are subject to the
Transfer Restrictions for the period the Transfer Restrictions by their terms
apply, and (ii) advise the Company in writing with a copy to each of Xxxxxx
Xxxxxxx and Xxxxxxx Xxxxx Xxxxxx in the event that any securities subject to the
Transfer Restrictions are presented to the transfer agent for transfer. The
Company shall not revoke, change or otherwise modify the Instructions without
obtaining the prior written consent of Xxxxxx Xxxxxxx and Xxxxxxx Xxxxx Xxxxxx.
The Company agrees that it will use reasonable efforts to take all appropriate
action to stop any attempted transfer that is intended to circumvent or would
have the effect of circumventing, the intent of this Section, the Transfer
Restrictions or the Instructions.
7. Indemnity and Contribution. (a) (i) The Company agrees to
indemnify and hold harmless 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 Securities Exchange Act of 1934, as amended
(the "Exchange 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,
any preliminary prospectus or the Prospectus (as amended or supplemented if the
Company shall have furnished any amendments or supplements 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 information relating to any Underwriter furnished to the Company in writing
by such Underwriter through you expressly for use therein; provided, however,
that the foregoing indemnity agreement with respect to any preliminary
prospectus shall not inure to the benefit of any Underwriter from whom the
person asserting any such losses, claims, damages or liabilities purchased
Shares, or any person controlling such Underwriter, if a copy of the Prospectus
(as then amended or supplemented if the Company shall have furnished any
amendments or supplements thereto) was not sent or given by or on behalf of such
Underwriter to such person, if required by law so to have been delivered, at or
prior to the written confirmation of the sale of the Shares to such person, and
if the Prospectus (as so amended or supplemented) would have cured the defect
giving rise to such losses, claims, damages or liabilities, unless such failure
is the result of noncompliance by the Company with Section 6(a) hereof. (ii) The
Company also agrees to indemnify and hold harmless [Xxxxxx Xxxxxxx] and each
person, if any, who controls [Xxxxxx Xxxxxxx] within the meaning of either
Section 15 of the Securities Act, or Section 20 of the Exchange Act, from and
against any and all losses, claims, damages, liabilities and judgments incurred
as a result of [Xxxxxx Xxxxxxx'x] participation as a "qualified independent
underwriter" within the meaning of Rule 2720 of the Conduct Rules of the
National Association of Securities Dealers in connection with the offering of
the Shares, except for any losses, claims, damages, liabilities, and judgments
resulting from [Xxxxxx Xxxxxxx'x], or such controlling person's, willful
misconduct.
28
(b) The Company agrees to indemnify and hold harmless Xxxxxxx
Xxxxx Xxxxxx, the directors, officers, employees and agents of Xxxxxxx Xxxxx
Xxxxxx and each person, who controls Xxxxxxx Xxxxx Xxxxxx within the meaning of
either the Securities Act or the Exchange Act ("Xxxxxxx Xxxxx Xxxxxx Entities"),
from and against any and all losses, claims, damages and liabilities to which
they may become subject under the Securities Act, the Exchange Act or other
federal or state statutory law or regulation, at common law or otherwise
(including, without limitation, any legal or other expenses reasonably incurred
in connection with defending or investigating any such action or claim), insofar
as such losses, claims, damages or liabilities (or actions in respect thereof)
(i) arise out of or are based upon any untrue statement or alleged untrue
statement of a material fact contained in the prospectus wrapper material
prepared by or with the consent of the Company for distribution in foreign
jurisdictions in connection with the Directed Share Program attached to the
Prospectus or any preliminary prospectus, (such material attached to the
Prospectus, the "Prospectus Wrapper" and such material attached to any
preliminary prospectus, the "Preliminary Prospectus Wrapper") or arise out of or
are based upon any omission or alleged omission to state therein a material fact
required to be stated therein or necessary to make the statement therein, when
considered in conjunction with the Prospectus or any applicable preliminary
prospectus, not misleading; (ii) are caused by the failure of any Participant to
pay for and accept delivery of the Directed Shares that such Participant has
agreed to purchase; or (iii) relate to, arise out of, or occur in connection
with the Directed Share Program, provided that, in the case of clause (i) the
Company will not be liable in any such case to the extent that any such loss,
claim, damage or liability arises out of or is based upon any such untrue
statement or alleged untrue statement or omission or alleged omission made
therein in reliance upon and in conformity with written information furnished to
the Company by or on behalf of Xxxxxxx Xxxxx Xxxxxx specifically for inclusion
therein and that in the case of clause (iii) the Company will not be liable to
the extent that such loss, claim, damage or liability results from the gross
negligence or willful misconduct of Xxxxxxx Xxxxx Xxxxxx; provided further, that
the foregoing indemnity with respect to the Preliminary Prospectus Wrapper or
the Prospectus Wrapper shall not inure to the benefit of any Xxxxxxx Xxxxx
Xxxxxx Entity from whom the person asserting any such loss, claim, damage or
liabilities purchased the Shares, to the extent that any such loss, claim,
damage or liability of such Xxxxxx Xxxxx Xxxxxx Entity occurs under the
circumstance where it shall have been determined by a court of competent
jurisdiction by final nonappealable judgment that (w) the Company had previously
furnished copies of the Prospectus Wrapper to Xxxxxxx Xxxxx Xxxxxx, (x) delivery
of the Prospectus Wrapper was required by applicable law to be made to such
person, (y) the untrue statement or omission of a material fact contained in the
Preliminary Prospectus Wrapper was corrected in the Prospectus Wrapper and (z)
there was not sent or given to such person, at or prior to the written
confirmation of the sale of the Shares to such person, a copy of the Prospectus
Wrapper.
(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 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 Registration Statement, any preliminary prospectus, the
Prospectus or any amendments or supplements thereto.
29
(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 7(a), 7(b) or 7(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 fees and expenses of more than one separate firm (in addition
to any local counsel) for all such indemnified parties and that all such fees
and expenses shall be reimbursed as they are incurred; provided, however, that
notwithstanding anything contained herein to the contrary, if indemnity may be
sought pursuant to Section 7(a)(ii) hereof in respect of such proceeding, then
in addition to such separate firm for the indemnified parties, the indemnifying
party shall be liable for the reasonable fees and expenses of not more than one
separate firm (in addition to any local counsel) for [Xxxxxx Xxxxxxx] in its
capacity as a "qualified independent underwriter" and all persons, if any, who
control [Xxxxxx Xxxxxxx] within the meaning of either Section 15 of the
Securities Act or Section 20 of the Exchange Act; and provided, further,
however, that notwithstanding anything contained herein to the contrary, if
indemnity may be sought pursuant to Section 7(b) hereof in respect of such
action or proceeding, then in addition to such separate firm for the indemnified
parties, the indemnifying party shall be liable for the reasonable fees and
expenses of not more than one separate firm (in addition to any local counsel)
for Xxxxxxx Xxxxx Xxxxxx, the directors, officers, employees and agents of
Xxxxxxx Xxxxx Xxxxxx, and all persons, if any, who control Xxxxxxx Xxxxx Xxxxxx
within the meaning of either the Securities Act or the Exchange Act for the
defense of any losses, claims, damages and liabilities arising out of the
Directed Share Program. Any firm retained to represent one or more indemnified
parties shall be designated in writing by Xxxxxx Xxxxxxx and Xxxxxxx Xxxxx
Xxxxxx, in the case of parties indemnified pursuant to Section 7(a)(i), by
[Xxxxxx Xxxxxxx], in the case of parties indemnified pursuant to Section
7(a)(ii), by Xxxxxxx Xxxxx Xxxxxx, in the case of parties indemnified pursuant
to Section 7(b), and by the Company, in the case of parties indemnified pursuant
to Section 7(c). 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. Notwithstanding the
foregoing sentence, if at any time an indemnified party shall have requested an
indemnifying party to reimburse the indemnified party for fees and expenses of
counsel as contemplated by the second and third sentences of this paragraph, the
indemnifying party agrees that it shall be liable for any settlement of any
proceeding effected without its written consent if (i) such settlement is
entered into more than 60 days after receipt by such indemnifying party of the
aforesaid request
30
and (ii) such indemnifying party shall not have reimbursed the indemnified party
in accordance with such request prior to the date of such settlement. 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.
(e) To the extent the indemnification provided for in Section
7(a), 7(b) or 7(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 the Company on the one hand and the Underwriters on the
other hand from the offering of the Shares or (ii) if the allocation provided by
clause 7(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
7(e)(i) above but also the relative fault of the Company on the one hand and of
the Underwriters 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 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 the total underwriting
discounts and commissions received by the Underwriters, in each case as set
forth in the table on the cover of the Prospectus, bear to the aggregate Public
Offering Price of the Shares. The relative fault of the Company 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 or by the Underwriters and the 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 7 are several in proportion to the
respective number of Shares they have purchased hereunder, and not joint.
(f) The Company and the Underwriters agree that it would not
be just or equitable if contribution pursuant to this Section 7 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 7(e). 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 7, 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
31
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 7 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 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 by or on behalf of the Company, its officers or directors or
any person controlling the Company and (iii) acceptance of and payment for any
of the Shares.
8. Termination. This Agreement shall be subject to termination
by notice given by you to the Company, if (a) 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 National Association
of Securities Dealers, Inc., 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 general moratorium on commercial banking
activities in New York shall have been declared by either Federal or New York
State authorities or a general moratorium on commercial banking activities in
Bermuda shall have been declared by Bermuda authorities or (iv) 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 (b) in the case of any of the events specified in clauses 8(a)(i)
through 8(a)(iv), such event, singly or together with any other such event,
makes it, in your judgment, impracticable to market the Shares on the terms and
in the manner contemplated in the Prospectus.
9. Effectiveness; Defaulting Underwriters. This Agreement
shall become effective upon the execution and delivery hereof by the parties
hereto.
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-tenth
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 8 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-tenth of the aggregate
number of Firm Shares to be purchased, and arrangements satisfactory to you and
the Company for the purchase of such Firm
32
Shares are not made within 36 hours after such default, this Agreement shall
terminate without liability on the part of any non-defaulting Underwriter or the
Company. In any such case either you 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 and in the
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-tenth 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.
If this Agreement shall be terminated by the Underwriters, or
any of them, because of any failure or refusal on the part of the Company to
comply with the terms or to fulfill any of the conditions of this Agreement, or
if for any reason the Company shall be unable to perform its obligations under
this Agreement, the Company will 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 reasonable fees and disbursements of
their counsel) reasonably incurred by such Underwriters in connection with this
Agreement or the offering contemplated hereunder.
10. Submission to Jurisdiction; Appointment of Agent for
Service. In further consideration of the agreement of the Underwriters herein
contained, the Company agrees and covenants as follows:
The Company irrevocably agrees 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 United States Federal or state court in the Borough of
Manhattan, The City of New York, State of New York (a "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 foreign
court. To the extent permitted by law, each of the 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 New York City as its 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-
33
exclusive jurisdiction of any 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 its 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 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.
The provisions of this Section 10 shall survive any
termination of this Agreement, in whole or in part.
11. 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 will indemnify each
party in whose favor such judgment or order has been given or made (the
"Indemnitee") against any loss incurred by the 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 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.
12. Waiver of Immunity. To the extent that the Company has or
hereafter may acquire any immunity (sovereign or otherwise) from any legal
action, suit or proceeding, from jurisdiction of any court or from set-off or
any legal process (whether service or notice, attachment in aid or otherwise)
with respect to itself or any of its property, the Company hereby irrevocably
waives and agrees not to plead or claim such immunity in respect of its
obligations under this Agreement.
13. 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.
14. Applicable Law. This Agreement shall be governed by and
construed in accordance with the internal laws of the State of New York.
34
15. 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.
Very truly yours,
Max Re Capital Ltd.
By:____________________________
Name:
Title:
Accepted as of the date hereof
Xxxxxx Xxxxxxx & Co. Incorporated
Xxxxxxx Xxxxx Xxxxxx Inc.
Acting severally on behalf of themselves and the several Underwriters named in
Schedule I hereto.
By: Xxxxxx Xxxxxxx & Co. Incorporated
By:__________________________
Name:
Title:
35
SCHEDULE I
Number of
Firm Shares
Underwriter To Be Purchased
Xxxxxx Xxxxxxx & Co. Incorporated
Xxxxxxx Xxxxx Xxxxxx Inc.
Xxxxxxx, Xxxxx & Co.
Banc of America Securities LLC
Dresdner Kleinwort Xxxxxxxxxxx Securities LLC
[NAMES OF OTHER UNDERWRITERS]
---------------
Total ........
===============
SCHEDULE II
[TO COME]
Exhibit A-1
TRANSFER AGENT INSTRUCTIONS
MAX RE CAPITAL LTD.
[ ], 2001
[Transfer Agent]
Ladies and Gentlemen:
Reference is made to that Underwriting Agreement dated as of [ ], 2001 (the
"Agreement") by and among Max Re Capital Ltd. (the "Company") and the several
underwriters named therein, for whom Xxxxxx Xxxxxxx & Co. Incorporated ("Xxxxxx
Xxxxxxx") and Xxxxxxx Xxxxx Xxxxxx Inc. ("Xxxxxxx Xxxxx Xxxxxx" and together
with Xxxxxx Xxxxxxx, the "Managers") are acting as representatives.
This letter shall serve as our instruction to you to record a stop order against
any attempt to transfer any common shares of the Company represented by the
certificates that are issued and outstanding on the date hereof (the "Subject
Shares") from the date hereof until [ ], 2001. Please be advised that during
this period, you are hereby instructed not to register or record any transfer of
the Subject Shares unless you have received from the Company and the Managers a
Letter of Instruction in the form attached hereto as Exhibit I. Furthermore, if
any certificates representing the Subject Shares are presented for transfer
prior to [ ], 2001, please notify the Company in writing at:
Max Re Capital Ltd.
Ascot House
00 Xxxxx Xxxxxx
Xxxxxxxx XX00
Xxxxxxx
Attention: Xxxxx Xxxxx
with copies to:
Xxxxxx Xxxxxxx & Co. Incorporated and Xxxxxxx Xxxxx Xxxxxx Inc.
0000 Xxxxxxxx 000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, XX 00000 Xxx Xxxx, XX 00000
Attention: [ ] Attention: [ ]
Please be advised that the Managers are relying on this letter as an inducement
to enter into the Agreement and, accordingly, the Managers are third party
beneficiaries to these instructions.
Please execute this letter in the space indicated to acknowledge your agreement
to act in accordance with these instructions. Should you have any questions
concerning this matter, please contact Xxxxx Xxxxx at (000) 000-0000.
Max Re Capital Ltd.
By: ____________________
Name:
Title:
The foregoing instructions are acknowledged
and agreed to this _____ day of [ ], 2001
[Transfer Agent]
By:_______________
Name:
Title:
2
Exhibit I
[LETTER OF INSTRUCTION]
MAX RE CAPITAL LTD.
[ ], 2001
[Transfer Agent]
Ladies and Gentlemen:
Reference is made to the instructions provided to you by Max Re Captial Ltd.
(the "Company") by letter dated [ ], 2001 with respect to the transfer of
certain common shares of the Company. You are hereby authorized and instructed
to record the following transfer:
Certificate Number From To
Number of Shares Registered Holder Registered Holder
--------- ------- -------------- ---------------
-------------- ---------------
-------------- ---------------
Please be advised that this letter of instruction authorizes only the specific
transfer described above, and no other transfer, whether of additional common
shares or from or to additional holders, is authorized.
Should you have any questions concerning this matter, please contact Xxxxx Xxxxx
at the Company at (000) 000-0000.
Sincerely,
------------------
Name:
Title:
Authorized by: Authorized by:
Xxxxxx Xxxxxxx & Co Incorporated Xxxxxxx Xxxxx Xxxxxx Inc.
--------------------- ---------------------
Name: Name:
Title: Title:
3
Exhibit A-2
Subscription Agreement, Section 5:
5. Subscriber Bound By Terms of Shareholders' Agreement. The terms and
provisions of the Shareholders' Agreement are hereby incorporated
herein by reference and shall be deemed to be a part hereof. By
executing this Agreement, the Subscriber shall be bound by the terms
and provisions of the Shareholders' Agreement, a copy of which has been
made available to the Subscriber, and the Subscriber shall be deemed to
be a "Shareholder" and holder of "Registrable Securities" thereunder.
The Subscriber acknowledges that Max Re Ltd., each of the Founding
Investors (as defined in the Shareholders' Agreement) and the other
parties to the Shareholders' Agreement are third-party beneficiaries to
this Section 5 and shall be entitled to enforce their respective rights
against the Subscriber under the Shareholders' Agreement. The
Subscriber hereby irrevocably constitutes and appoints each of the
officers of the Company, with full power of substitution, as the
Subscriber's true and lawful representative and attorney, granting unto
such attorney full power and authority in the Subscriber's name, place
and stead to make, execute, acknowledge, deliver, swear to, file and
record in all necessary or appropriate places the Shareholders'
Agreement substantially in the form attached to the Memorandum but with
such material amendments thereto as the Subscriber agrees. The power of
attorney granted hereby is coupled with an interest, is irrevocable,
and shall survive the death, dissolution, winding-up, amalgamation,
merger, incompetency or incapacity of the Subscriber. The Subscriber
shall not transfer the Shares to any person except in accordance with
the Shareholders' Agreement and the transferee of such Shares agrees to
be bound by the terms of this Section 5 and the Shareholders'
Agreement. Any transfer of the Shares in violation of this Section 5 or
the Shareholders' Agreement shall be void ab initio and shall not be
recorded in the -- ------ Company's Register of Members. The provisions
of this Section 5 shall survive the subscription made hereby and shall
remain in full force and effort for so long as the Shareholders'
Agreement is in effect.
Exhibit B
[FORM OF LOCK-UP LETTER - OFFICERS, DIRECTORS AND 5% SHAREHOLDERS]
_____________, 2001
Xxxxxx Xxxxxxx & Co. Incorporated
Xxxxxxx Xxxxx Xxxxxx Inc.
c/o Morgan Xxxxxxx & Co. Incorporated
0000 Xxxxxxxx
Xxx Xxxx, XX 00000
Dear Sirs and Mesdames:
The undersigned understands that Xxxxxx Xxxxxxx & Co.
Incorporated ("Xxxxxx Xxxxxxx") and Xxxxxxx Xxxxx Xxxxxx Inc. ("Xxxxxxx Xxxxx
Xxxxxx") propose to enter into an Underwriting Agreement (the "Underwriting
Agreement") with Max Re Capital Ltd., a company existing under the laws of
Bermuda (the "Company"), providing for the public offering (the "Public
Offering") by the several Underwriters, including Xxxxxx Xxxxxxx and Xxxxxxx
Xxxxx Xxxxxx (the "Underwriters"), of ___ (the "Shares") Common Shares, par
value $1.00 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 Xxxxxx
Xxxxxxx and Xxxxxxx Xxxxx Xxxxxx on behalf of the Underwriters, it will not,
during the period commencing on the date hereof and ending 180 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 any securities convertible into or
exercisable or exchangeable for Common Stock or any securities convertible into
or exchangeable or exercisable for any such securities 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 the 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 Xxxxxx Xxxxxxx and
Xxxxxxx Xxxxx Xxxxxx on behalf of the Underwriters, it will not, during the
period commencing on the date hereof and ending 180 days after the date of the
Prospectus, make any demand for or exercise any right with respect to, the
registration of any shares of Common Stock, any securities convertible into or
exercisable or exchangeable for Common Stock or any
C-1
securities convertible into or exchangeable or exercisable for any such
securities. 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 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)
C-2
Exhibit C
[FORM OF LOCK-UP LETTER - SHAREHOLDERS]
_____________, 2001
Xxxxxx Xxxxxxx & Co. Incorporated
Xxxxxxx Xxxxx Xxxxxx Inc.
c/o Morgan Xxxxxxx & Co. Incorporated
0000 Xxxxxxxx
Xxx Xxxx, XX 00000
Dear Sirs and Mesdames:
The undersigned understands that Xxxxxx Xxxxxxx & Co.
Incorporated ("Xxxxxx Xxxxxxx") and Xxxxxxx Xxxxx Xxxxxx Inc. ("Xxxxxxx Xxxxx
Xxxxxx") propose to enter into an Underwriting Agreement (the "Underwriting
Agreement") with Max Re Capital Ltd., a company existing under the laws of
Bermuda (the "Company"), providing for the public offering (the "Public
Offering") by the several Underwriters, including Xxxxxx Xxxxxxx and Xxxxxxx
Xxxxx Xxxxxx (the "Underwriters"), of ___ (the "Shares") Common Shares, par
value $1.00 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 Xxxxxx
Xxxxxxx and Xxxxxxx Xxxxx Xxxxxx on behalf of the Underwriters, it will not,
during the period commencing on the date hereof and ending 180 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 any securities convertible into or
exercisable or exchangeable for Common Stock or any securities convertible into
or exchangeable or exercisable for any such securities 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 the 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. The foregoing
sentence shall not apply to transactions relating to shares of Common Stock or
other securities acquired in open market transactions after the completion of
the Public Offering. In addition, the undersigned agrees that, without the prior
written consent of Xxxxxx Xxxxxxx and Xxxxxxx Xxxxx Xxxxxx on behalf of the
Underwriters, it will not, during the period commencing on the date hereof and
ending 180 days after the date of the Prospectus, make any demand for or
exercise any right with respect to, the registration of any shares of Common
D-1
Stock, any securities convertible into or exercisable or exchangeable for Common
Stock or any securities convertible into or exchangeable or exercisable for any
such securities. 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 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)
D-2
