Exhibit 99.11
TRANSATLANTIC HOLDINGS, INC.
XXXXXX SHARES OF COMMON STOCK
----------
UNDERWRITING AGREEMENT
March 9, 2010
Xxxxxxx, Xxxxx & Co.,
Xxxxx Fargo Securities, LLC
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated
As Representatives of the several Underwriters
named in Schedule I(a) hereto,
c/o Goldman, Sachs & Co.
00 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
c/o Wells Fargo Securities, LLC
000 Xxxx Xxxxxx
0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
c/o Merrill Lynch, Pierce, Xxxxxx & Xxxxx Incorporated
Xxx Xxxxxx Xxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
American Home Assurance Company, a New York insurance corporation, and a
wholly owned subsidiary of American International Group, Inc., a Delaware
corporation (the "SELLING STOCKHOLDER"), a stockholder of Transatlantic
Holdings, Inc., a Delaware corporation (the "COMPANY"), proposes, subject to the
terms and conditions stated herein, to sell to the Underwriters named in
Schedule I(a) hereto (the "UNDERWRITERS") an aggregate of 8,466,693 shares (the
"FIRM SHARES") and, at the election of the Underwriters, up to 725,969
additional shares (the "OPTIONAL SHARES") of common stock, par value $1.00 per
share, of the Company (the "STOCK"). The Firm Shares and the Optional Shares
that the Underwriters elect to purchase pursuant to Section 3 hereof are herein
collectively called the "SHARES".
In connection with the aforementioned issuance and sale, at the request of
the Selling Stockholder, the Selling Stockholder and the Underwriters agree that
2,000,000 of the Firm
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Shares (the "REPURCHASE SHARES") shall be reserved for sale by the Underwriters
to the Company as part of the distribution of the Shares by the Underwriters,
subject to the terms of this Agreement, the Stock Offering Agreement, dated as
of March 7, 2010, by and between the Selling Stockholder, the Company and the
Underwriters, and all applicable law, rules and regulations.
1. Representations, Warranties and Agreements of the Company. The
Company represents, warrants to and agrees with, the Underwriters that:
(a) The Company has, not earlier than three years prior to the
date hereof, filed with the Securities and Exchange Commission (the
"COMMISSION") an automatic shelf registration statement as defined under
Rule 405 under the Securities Act of 1933, as amended (the "SECURITIES
ACT", which term, as used herein, includes the rules and regulations of the
Commission promulgated thereunder) on Form S-3 (No. 333-155811), including
the related prospectus, which registration statement, and any
post-effective amendment thereto, became effective upon filing under Rule
462(e) of the Securities Act, for the registration under the Securities Act
of the Shares. No stop order suspending the effectiveness of the
registration statement has been issued under the Securities Act and no
proceedings for that purpose have been instituted or are pending or, to the
knowledge of the Company, are contemplated by the Commission, no notice of
objection of the Commission to the use of such registration statement or
any post-effective amendment thereto pursuant to Rule 401(g)(2) under the
Securities Act has been received by the Company and any request on the part
of the Commission for additional information has been complied with.
(b) The Company will file with the Commission pursuant to Rule
430B ("RULE 430B") and paragraph (b) of Rule 424 ("RULE 424(B)") under the
Securities Act a supplement or supplements to the prospectus included in
such registration statement relating to the Shares and the plan of
distribution thereof. Such registration statement, at any given time,
including the amendments thereto at such time, all exhibits thereto and any
schedules thereto at such time, and the documents otherwise deemed to be a
part thereof or included therein under the Securities Act, is hereinafter
called the "REGISTRATION STATEMENT"; such prospectus in the form in which
it appears in the Registration Statement is hereinafter called the "BASE
PROSPECTUS"; and such supplemented prospectus, in the form in which it
shall first be filed with the Commission pursuant to Rule 424(b) (including
the Base Prospectus as so supplemented), after the date and time that this
Agreement is executed and delivered, is hereinafter called the "FINAL
PROSPECTUS." The Registration Statement at the time it originally became
effective is hereinafter called the "ORIGINAL REGISTRATION STATEMENT." Any
information included in the Final Prospectus that was omitted from the
Original Registration Statement but that is deemed to be part of and
included in such Registration Statement pursuant to Rule 430B is referred
to as "RULE 430B INFORMATION." Each prospectus used in connection with the
offering of the Shares that omitted Rule 430B Information is hereinafter
called a "PRELIMINARY PROSPECTUS" and the Base Prospectus, as amended and
supplemented immediately prior to the Applicable Time (as defined in
Section 1(g) hereof), is hereinafter called the "PRICING PROSPECTUS." Any
reference herein to the Registration Statement, the Base Prospectus, any
Preliminary Prospectus, the Pricing Prospectus or the Final Prospectus
shall be deemed to refer to and include the documents incorporated by
reference therein pursuant to Item 12 of Form S-3 which were filed under
the Securities Exchange Act of 1934, as amended (the "EXCHANGE
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ACt", which term, as used herein, includes the rules and regulations of the
Commission promulgated thereunder) or otherwise deemed under the Securities
Act to be a part of or included therein; and any reference herein to the
terms "amend," "amendment" or "supplement" with respect to the Registration
Statement, the Base Prospectus, any Preliminary Prospectus or the Final
Prospectus shall be deemed to refer to and include any document filed under
the Exchange Act after the date of this Agreement, or the issue date of the
Base Prospectus, any Preliminary Prospectus or the Final Prospectus, as the
case may be, deemed to be incorporated therein by reference or otherwise
deemed under the Securities Act to be a part of or included therein. Each
Preliminary Prospectus and the prospectuses filed as part of the
Registration Statement as originally filed or as part of any amendment
thereto, or filed pursuant to Rule 424(b) under the Securities Act,
complied when so filed in all material respects with the Securities Act and
each Preliminary Prospectus and the Final Prospectus delivered to the
Underwriters for use in connection with this offering was identical to the
electronically transmitted copies thereof filed with the Commission via the
Electronic Data Gathering, Analysis and Retrieval ("XXXXX") system, except
to the extent permitted by Regulation S-T.
(c) (A)(i) At the time of filing the Original Registration
Statement, (ii) at the time of the most recent amendment thereto for the
purposes of complying with Section 10(a)(3) of the Securities Act (whether
such amendment was by post-effective amendment, incorporated report filed
pursuant to Section 13 or 15(d) of the Exchange Act or form of prospectus),
and (iii) at the time the Company or any person acting on its behalf
(within the meaning, for this clause only, of Rule 163(c) under the
Securities Act) made any offer relating to the Shares in reliance on the
exemption of Rule 163 under the Securities Act, the Company was a
"well-known seasoned issuer" as defined in Rule 405 under the Securities
Act; and (B) at the earliest time after the filing of the Registration
Statement that the Company or another offering participant made a bona fide
offer (within the meaning of Rule 164(h)(2) under the Securities Act) of
the Shares, the Company was not an "ineligible issuer" as defined in Rule
405 under the Securities Act.
(d) The Registration Statement conforms, and the Final Prospectus
and any further amendments or supplements to the Registration Statement and
the Final Prospectus will conform, in all material respects to the
requirements of the Securities Act and the rules and regulations of the
Commission thereunder.
(e) (i) The Registration Statement and any post-effective
amendment thereto do not and will not, as of the applicable effective date
as to each part of the Registration Statement and as of the applicable
filing date as to any amendment or supplement thereto, as of the date such
amendment becomes effective or such supplement is filed with the
Commission, as the case may be, contain an 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 and (ii) the Final
Prospectus, as of its date, and any amendment or supplement thereto, as of
the applicable filing date, does not and 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; provided, however, that this representation
and warranty shall not apply to any statements or omissions made in
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reliance upon and in conformity with information furnished in writing to
the Company by an Underwriter through the Representatives expressly for use
therein.
(f) No order preventing or suspending the use of any Preliminary
Prospectus or any Issuer Represented Free Writing Prospectus (as defined in
Rule 433 under the Securities Act and referred to herein as "ISSUER FREE
WRITING PROSPECTUS") has been issued by the Commission, and each
Preliminary Prospectus, at the time of filing thereof, conformed in all
material respects to the requirements of the Securities Act and the rules
and regulations of the Commission thereunder, and did not contain an 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, in the light
of the circumstances under which they were made, not misleading; provided,
however, that this representation and warranty shall not apply to any
statements or omissions made in reliance upon and in conformity with
information furnished in writing to the Company by an Underwriter through
the Representatives expressly for use therein.
(g) For the purposes of this Agreement, the "APPLICABLE TIME" is
6:00 p.m. (Eastern time) on March 9, 2010, and the "GENERAL DISCLOSURE
PACKAGE" means (i) the Pricing Prospectus as of the Applicable Time, (ii)
the information included in Schedule II(c) hereto and (iii) the Issuer Free
Writing Prospectuses, if any, listed on Schedule II(a) hereto under the
heading "General Disclosure Package Free Writing Prospectuses". The General
Disclosure Package, as of the Applicable Time, did not include any untrue
statement of a material fact or omit to state any material fact necessary
in order to make the statements therein, in the light of the circumstances
under which they were made, not misleading; provided, however, that this
representation and warranty shall not apply to statements or omissions made
in reliance upon and in conformity with the information furnished in
writing to the Company by an Underwriter through the Representatives
expressly for use therein.
(h) Each Issuer Free Writing Prospectus listed on Schedule II(a)
hereto does not conflict with the information contained in the Registration
Statement, the Pricing Prospectus or the Final Prospectus; and each such
Issuer Free Writing Prospectus, as supplemented by and taken together with
the Pricing Prospectus as of the Applicable Time did not include any untrue
statement of a material fact or omit to state any material fact necessary
in order to make the statements therein, in the light of the circumstances
under which they were made, not misleading; provided, however, that this
representation and warranty shall not apply to statements or omissions made
in reliance upon and in conformity with information furnished in writing to
the Company by an Underwriter through the Representatives expressly for use
therein.
(i) Each document incorporated or deemed to be incorporated by
reference in the Registration Statement, the General Disclosure Package and
the Final Prospectus, at the time they were or hereafter are filed with the
Commission, complied and will comply in all material respects with the
Securities Act or the Exchange Act, as applicable, and, when read together
with the other information in the General Disclosure Package and the Final
Prospectus, at the Applicable Time and at each Time of Delivery (as
hereinafter defined) did not and will not contain an 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;
provided, however, that this representation and warranty shall not apply to
any statements or
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omissions made in reliance upon and in conformity with information
furnished in writing to the Company by an Underwriter through the
Representatives expressly for use therein; no such documents were filed
with the Commission since the Commission's close of business on the
business day immediately prior to the date of this Agreement and prior to
the execution of this Agreement, except as set forth on Schedule II(b)
hereto; and there are no contracts or documents which are required to be
described in the Registration Statement, the General Disclosure Package,
the Final Prospectus or the documents incorporated by reference therein or
to be filed as exhibits thereto which have not been so described and filed
as required.
(j) Each of the Company and its operating subsidiaries has been
duly organized and is validly existing as a corporation in good standing
under the laws of the jurisdiction of its incorporation and has corporate
power and authority to own, lease and operate its properties and to conduct
its business as described in the General Disclosure Package and the Final
Prospectus. Each of the Company and its subsidiaries is duly qualified as a
foreign corporation to transact business and is in good standing in each
jurisdiction in which such qualification is required, whether by reason of
the ownership or leasing of property or the conduct of business, except for
such jurisdictions where the failure to so qualify or to be in good
standing would not, individually or in the aggregate, have a Material
Adverse Effect (as defined in Section 1(m) below). All of the issued and
outstanding capital stock of each subsidiary has been duly authorized and
validly issued, is fully paid and non-assessable and is owned by the
Company, directly or through subsidiaries, free and clear of any security
interest, mortgage, pledge, lien, encumbrance or claim.
(k) The Company has all requisite corporate power and authority
to execute and deliver this Agreement and perform its obligations
hereunder; this Agreement has been duly authorized, executed and delivered
by the Company.
(l) The Company has an authorized capitalization as set forth in
the General Disclosure Package and Final Prospectus and all of the issued
shares of capital stock of the Company have been duly and validly
authorized and issued and are fully paid and non-assessable and conform in
all material respects to the description of the Stock contained in the
General Disclosure Package and Final Prospectus. Except as disclosed in the
General Disclosure Package and Final Prospectus, there are no contracts,
agreements or understandings between the Company and any person granting
such person the right to require the Company to include any such securities
in the securities registered pursuant to a Registration Statement or in any
securities being registered pursuant to any other registration statement
filed by the Company under the Securities Act. The Shares are listed on the
New York Stock Exchange.
(m) Except as disclosed in the General Disclosure Package and
Final Prospectus, the execution, delivery and performance of this
Agreement, the consummation of the transactions contemplated hereby, do not
and will not, whether with or without the giving of notice or passage of
time or both, conflict with or constitute a breach of any of the terms or
provisions of, or constitute a default or Repayment Event (as defined
below) under, or result in the creation or imposition of any lien, charge
or encumbrance upon any property or assets of the Company or any subsidiary
pursuant to any indenture, mortgage, deed of trust, loan or credit
agreement, note, contract, franchise, lease or other agreement or
instrument to which the Company or any of its subsidiaries is a party or by
which the Company or any of its
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subsidiaries is bound or to which any of the property or assets of the
Company or any of its subsidiaries is subject, except for such conflicts,
breaches, violations or defaults as would not, either individually or in
the aggregate, have a material adverse effect on the consolidated financial
position, stockholders' equity, results of operations or business of the
Company and its subsidiaries taken as a whole (such effect, a "MATERIAL
ADVERSE EFFECT"); nor will such action result in any violation of (i) any
applicable law, statute, rule, regulation, judgment, order, writ or decree
of any government, government instrumentality or any regulatory authority
or court, domestic or foreign, having jurisdiction over the Company or any
of its subsidiaries or any of their assets, properties or operations
(except for such violations that would not result in a Material Adverse
Effect) or (ii) the provisions of the charter or by-laws of the Company or
any of its subsidiaries. As used herein, a "REPAYMENT EVENT" means any
event or condition that gives the holder of any note, debenture or other
evidence of indebtedness of the Company or any of its subsidiaries (or any
person acting on such holder's behalf) the right to require the repurchase,
redemption or repayment of all or a portion of such indebtedness by the
Company or any of its subsidiaries.
(n) Neither the Company nor any of its subsidiaries is (i) in
violation of its charter or by-laws or (ii) in default (or, with the giving
of notice or lapse of time, would be in default) under any indenture,
mortgage, deed of trust, loan agreement or other agreement or instrument to
which the Company or any of its subsidiaries is a party or by which the
Company or any of its subsidiaries may be bound, or to which any of the
property or assets of the Company or any of its subsidiaries is subject,
except, in the case of (ii) (y) as disclosed in the General Disclosure
Package and Final Prospectus and (z) for such defaults as would not,
individually or in the aggregate, have a Material Adverse Effect.
(o) Except as disclosed in the General Disclosure Package and
Final Prospectus and except as have already been obtained or may be
required under the Securities Act or state securities or "blue sky" laws,
no consent, approval, authorization or order of, or filing or registration
with, any court or governmental agency or body or any regulatory authority
is required for the execution, delivery and performance of this Agreement
by the Company, the consummation of the transactions contemplated hereby
and thereby.
(p) The Company is not, and after giving effect to the offering
and sale of the Shares as described in the General Disclosure Package and
the Final 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.
(q) Each of the Company's subsidiaries that is engaged in the
business of insurance or reinsurance (each an "INSURANCE Subsidiary",
collectively the "INSURANCE SUBSIDIARIES") is duly licensed to conduct an
insurance or a reinsurance business, as the case may be, under the
insurance statutes of each jurisdiction in which the conduct of its
business requires such licensing, except for such jurisdictions in which
the failure of the Insurance Subsidiaries to be so licensed would not,
individually or in the aggregate, result in a Material Adverse Effect. The
Insurance Subsidiaries have made all required filings under applicable
insurance statutes in each jurisdiction where such filings are required,
except for such jurisdictions in which the failure to make such filings
would not, individually or in the aggregate, result in a Material Adverse
Effect. Each of the Insurance Subsidiaries has all other
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necessary authorizations, approvals, orders, consents, certificates,
permits, registrations and qualifications of and from all domestic and
foreign insurance regulatory authorities necessary to conduct their
respective businesses as described in the General Disclosure Package and
the Final Prospectus, except where the failure to have such authorizations,
approvals, orders, consents, certificates, permits, registrations or
qualifications would not, individually or in the aggregate, result in a
Material Adverse Effect, and none of the Company or its Insurance
Subsidiaries has received any notification from any insurance regulatory
authority to the effect that any additional authorization, approval, order,
consent, certificate, permit, registration or qualification is needed to be
obtained by the Company or any of its Insurance Subsidiaries in any case
where it could be reasonably expected that (x) the Company or any of its
Insurance Subsidiaries would be required either to obtain such additional
authorization, approval, order, consent, certificate, permit, registration
or qualification or to cease or otherwise limit the writing of certain
business and (y) the failure to obtain such additional authorization,
approval, order, consent, certificate, permit, registration or
qualification or the limiting of the writing of such business would result
in a Material Adverse Effect. No insurance regulatory authority having
jurisdiction over the Company or any of its Insurance Subsidiaries has (i)
except as disclosed in the General Disclosure Package and the Final
Prospectus, or as would not have a Material Adverse Effect, issued any
order or decree impairing, restricting or prohibiting the continuation of
the business of the Company or any of the Insurance Subsidiaries in all
material respects as presently conducted or (ii) except as disclosed in the
General Disclosure Package and the Final Prospectus, issued any order or
decree impairing, restricting or prohibiting the payment of dividends by
any Insurance Subsidiary to its parent.
(r) Except as disclosed in the General Disclosure Package and the
Final Prospectus, all reinsurance treaties and arrangements to which the
Insurance Subsidiaries are a party are in full force and effect, and none
of the Insurance Subsidiaries is in violation of, or in default in the
performance, observance or fulfillment of, any obligation, agreement,
covenant or condition contained therein, except to the extent that any such
failure to be in full force and effect or any such violation or default
would not have a Material Adverse Effect. Neither the Company nor any of
the Insurance Subsidiaries has received any notice from any of the other
parties to such agreements that such other party intends not to perform in
any material respect such agreement and none of the Company and such
Insurance Subsidiaries has any reason to believe that any of the other
parties to such agreements will be unable to perform such agreements,
except to the extent that (i) the Company or such subsidiary has
established appropriate reserves on its financial statements or (ii) such
nonperformance would not reasonably be expected, individually or in the
aggregate, to have a Material Adverse Effect; and neither the Company nor
its Insurance Subsidiaries has given effect to such agreements in its
underwriting results in its most recently filed statutory financial
statements unless such agreements were in material conformity with the
requirements therefor of the insurance department of the state of domicile
of each such subsidiary in effect at such time of preparation for
reinsurance ceded pursuant to such agreements or giving effect to such
agreements is otherwise permitted by applicable accounting or regulatory
standards.
(s) Except as disclosed in the General Disclosure Package and the
Final Prospectus, there are no legal or governmental proceedings pending to
which the Company or any of its subsidiaries is a party or of which any
property or assets of the Company or any of its subsidiaries is the subject
which, singularly or in the aggregate, would be reasonably likely
7
to have a Material Adverse Effect, and to the best knowledge of the
Company, no such proceedings are threatened or contemplated by governmental
authorities or threatened by others, except as would not, singly or in the
aggregate, be reasonably likely to have a Material Adverse Effect.
(t) Neither the Company, nor to its knowledge, any of its
affiliates (as defined in Rule 501(b) of Regulation D under the Securities
Act, but excluding AIG and its affiliates other than the Company and its
subsidiaries) ("AFFILIATES"), has taken, directly or indirectly, any action
designed to cause or result in, or which has constituted or which might
reasonably be expected to constitute, the stabilization or manipulation of
the price of any security of the Company to facilitate the sale or resale
of the Shares; provided, however, that no such representation is made as to
the Underwriters or any person acting on their behalf.
(u) The consolidated financial statements of the Company included
in the Registration Statement, the General Disclosure Package and the Final
Prospectus fairly present in all material respects the financial condition
of the Company and its consolidated subsidiaries as of the respective dates
indicated and the consolidated results of operations and changes in
stockholders' equity of the Company and its consolidated subsidiaries for
the periods specified, in each case in all material respects in conformity
with generally accepted accounting principles as applied in the United
States ("GAAP") applied on a consistent basis throughout the periods
involved (except as indicated in the notes thereto). The summary and
selected historical financial data of the Company included in the General
Disclosure Package and the Final Prospectus fairly present in all material
respects the information shown therein and have been compiled on a basis
consistent with that of the consolidated interim or audited financial
statements of the Company included in the General Disclosure Package and
the Final Prospectus.
(v) The statutory annual and quarterly statements of the
Insurance Subsidiaries and the statutory balance sheets and income
statements included in such statutory annual and quarterly statements, most
recently filed with the State of New York, have been prepared in conformity
with required or permitted or prescribed statutory accounting principles or
practices applied on a consistent basis, except as may otherwise be
indicated in the notes thereto, and present fairly the financial position
of the Insurance Subsidiaries (on a statutory basis) for the period covered
thereby.
(w) Neither the Company nor any of its subsidiaries has sustained
since the date of the latest audited financial statements included in the
Final Prospectus and the General Disclosure Package any material loss or
interference with its business material to the Company and its subsidiaries
considered as a whole, otherwise than as set forth or contemplated in the
General Disclosure Package and the Final Prospectus; and, since the date as
of which information is given in the Final Prospectus and except as
contemplated in the General Disclosure Package and the Final Prospectus,
there has not been (x) any material addition, or any development involving
a prospective material addition, to the Company's consolidated reserves for
losses and loss adjustment expense, (y) any change in the authorized
capital stock of the Company or any of its subsidiaries or any increase in
the consolidated short-term or long-term debt of the Company or (z) any
Material Adverse Effect.
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(x) PriceWaterhouseCoopers LLP, who have certified certain
financial statements of the Company and its subsidiaries, and have audited
the Company's internal control over financial reporting and management's
assessment thereof are independent public accountants as required by the
Securities Act and the rules and regulations of the Commission thereunder.
(y) Neither the Company nor, to the knowledge of the Company, any
director, officer, agent, employee, affiliate or other person acting on
behalf of the Company or any of its subsidiaries is aware of or has taken
any action, directly or indirectly, that would result in a violation by
such persons of the Foreign Corrupt Practices Act of 1977, as amended, and
the rules and regulations thereunder (the "FCPA"), including, without
limitation, making use of the mails or any means or instrumentality of
interstate commerce corruptly in furtherance of an offer, payment, promise
to pay or authorization of the payment of any money, or other property,
gift, promise to give, or authorization of the giving of anything of value
to any "foreign official" (as such term is defined in the FCPA) or any
foreign political party or official thereof or any candidate for foreign
political office, in contravention of the FCPA and the Company and, to the
knowledge of the Company, its affiliates have conducted their businesses in
compliance with the FCPA and have instituted and maintain policies and
procedures designed to ensure, and which are reasonably expected to
continue to ensure, continued compliance therewith.
(z) Since December 31, 2009, (i) no downgrading has occurred in
the rating accorded the insurer and insurance financial strength of the
Company or any Insurance Subsidiary by any "nationally recognized
statistical rating organization", as that term is defined by the Commission
for purposes of Rule 436(g)(2) of the Securities Act and (ii) no such
rating organization has made an initial public announcement that it has
under surveillance or review, with possible negative implications, its
rating of the insurer and insurance financial strength of the Company or
any of its Insurance Subsidiaries.
(aa) The Company and each of its subsidiaries maintain a system
of internal accounting controls sufficient to provide reasonable assurances
that (i) transactions are executed in accordance with management's general
or specific authorization; (ii) transactions are recorded as necessary to
permit preparation of financial statements in conformity with GAAP and to
maintain accountability for assets; (iii) access to assets is permitted
only in accordance with management's general or specific authorization; and
(iv) the recorded accountability for assets is compared with the existing
assets at reasonable intervals and appropriate action is taken with respect
to any differences. Except as described in the General Disclosure Package
and the Final Prospectus, since the end of the Company's most recent
audited fiscal year, there has been (i) no material weakness in the
Company's internal control over financial reporting (whether or not
remediated) and (ii) no change in the Company's internal control over
financial reporting that has materially affected, or is reasonably likely
to materially affect, the Company's internal control over financial
reporting.
(bb) The Company and its consolidated subsidiaries employ
disclosure controls and procedures that are designed to ensure that
information required to be disclosed by the Company in the reports that it
files or submits under the Exchange Act is recorded, processed, summarized
and reported, within the time periods specified in the Commission's rules
and
9
forms, and is accumulated and communicated to the Company's management,
including its principal executive officer or officers and principal
financial officer or officers, as appropriate, to allow timely decisions
regarding disclosure.
(cc) There is and has been no failure on the part of the Company
or any of the Company's directors or officers, in their capacities as such,
to comply in all material respects with any provision of the Xxxxxxxx-Xxxxx
Act of 2002 and the rules and regulations promulgated in connection
therewith (the "XXXXXXXX-XXXXX ACT"), including Section 402 related to
loans and Sections 302 and 906 related to certifications.
(dd) The statements made in the Pricing Prospectus and the Final
Prospectus under the captions "Description of Capital Stock", insofar as
they purport to constitute a summary of the terms of the Shares, under the
caption "Certain Agreements with AIG" and "Underwriting" insofar as they
purport to describe the provisions of the laws and documents referred to
therein, are accurate, complete and fair in all material respects.
(ee) The Registration Statement is not the subject of a pending
proceeding or examination under Section 8(d) or 8(e) of the Securities Act,
and the Company is not the subject of a pending proceeding under Section 8A
of the Securities Act in connection with the offering of the Shares.
(ff) To the extent required to avoid a Material Adverse Effect,
the Company and its subsidiaries own or possess, or can acquire on
reasonable terms, adequate 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, trade names or other intellectual
property (collectively, "INTELLECTUAL PROPERTY") necessary to carry on the
business now operated by them; and neither the Company nor any of its
subsidiaries has received any notice or is otherwise aware of any
infringement of or conflict with asserted rights of others with respect to
any Intellectual Property or of any facts or circumstances which would
render any Intellectual Property invalid or inadequate to protect the
interest of the Company or any of its subsidiaries therein, and which
infringement or conflict (if the subject of any unfavorable decision,
ruling or finding) or invalidity or inadequacy, singly or in the aggregate,
would result in a Material Adverse Effect.
(gg) The operations of the Company are and have been conducted at
all times in compliance with applicable financial recordkeeping and
reporting requirements of the Currency and Foreign Transactions Reporting
Act of 1970, as amended, the money laundering statutes of all
jurisdictions, the rules and regulations thereunder and any related or
similar rules, regulations or guidelines, issued, administered or enforced
by any governmental agency (collectively, the "MONEY LAUNDERING LAWS") and
no action, suit or proceeding by or before any court or governmental
agency, authority or body or any arbitrator involving the Company with
respect to the Money Laundering Laws is pending or, to the best knowledge
of the Company, threatened.
10
(hh) Neither the Company nor, to the knowledge of the Company,
any director, officer, agent, employee, affiliate or person acting on
behalf of the Company is currently subject to any U.S. sanctions
administered by the Office of Foreign Assets Control of the U.S. Treasury
Department ("OFAC"); and the Company will not directly or indirectly use
the proceeds of the offering, or lend, contribute or otherwise make
available such proceeds to any subsidiary, joint venture partner or other
person or entity, for the purpose of financing the activities of any person
currently subject to any U.S. sanctions administered by OFAC.
Any certificate signed by an officer of the Company and delivered
to the Underwriters or to counsel for the Underwriters shall be deemed to
be a representation and warranty by the Company to each Underwriter as to
the matters set forth therein.
2. Representations, Warranties and Agreements of the Selling
Stockholder. The Selling Stockholder represents, warrants to and agrees with,
the Underwriters that:
(a) All consents, approvals, authorizations and orders necessary
for the execution and delivery by the Selling Stockholder of this
Agreement, and for the sale and delivery of the Shares to be sold by the
Selling Stockholder hereunder, have been obtained; and the Selling
Stockholder has full right, power and authority to enter into this
Agreement and to sell, assign, transfer and deliver the Shares to be sold
by the Selling Stockholder hereunder, except in each such case, with such
exceptions as will not, individually or in the aggregate, have a material
adverse effect on the Selling Stockholder's ability to consummate the
transactions contemplated herein.
(b) The sale of the Shares to be sold by the Selling Stockholder
hereunder and the compliance by the Selling Stockholder with all of the
provisions of this Agreement and the consummation of the transactions
herein and therein contemplated will not (i) conflict with or result in a
breach or violation of any of the terms or provisions of, or constitute a
default under, any statute, indenture, mortgage, deed of trust, loan
agreement or other agreement or instrument to which the Selling Stockholder
is a party or by which the Selling Stockholder is bound or to which any of
the property or assets of the Selling Stockholder is subject, nor (ii)
result in any violation of the provisions of the Certificate of
Incorporation or By-laws of the Selling Stockholder, nor (iii) result in
the breach or violation of any statute or any order, rule or regulation of
any court or governmental agency or body having jurisdiction over the
Selling Stockholder or the property of the Selling Stockholder, except, in
the case of (i) and (iii), with such exceptions as will not, individually
or in the aggregate, have a material adverse effect on the Selling
Stockholder's ability to consummate the transactions contemplated herein.
(c) Immediately prior to each Time of Delivery (as defined in
Section 3(e) hereof), the Selling Stockholder will have good and valid
title to a security interest in the Shares to be sold hereunder, free and
clear of all liens, encumbrances, equities or claims, and upon payment
therefor and delivery to the Depository Trust Company ("DTC") or its agent
of the Shares registered in the name of Cede & Co. ("CEDE") or such other
nominee as may be designated by DTC, both as provided for herein, and the
crediting of the Shares to the Underwriters' accounts with DTC, Cede & Co.
or such other nominee designated by DTC will be a "protected purchaser" of
the Shares (as defined in Section 8-303 of the Uniform Commercial Code as
adopted in the State of New York (the "UCC")), the Underwriters will
11
acquire a valid "security entitlement" (within the meaning of Section 8-501
of the UCC) to the Shares, and no action based on an "adverse claim" (as
defined in Section 8-102 of the UCC) may be asserted against the
Underwriters with respect to such security entitlement (assuming that the
Underwriters are without notice of any such adverse claim).
(d) During the period beginning from the date hereof and
continuing to and including the date forty-five (45) days after the date of
the Prospectus (the "LOCK UP PERIOD"), not to offer, sell contract to sell
or otherwise dispose of, except as provided hereunder, any securities of
the Company that are substantially similar to the Shares, including but not
limited to any securities that are convertible into or exchangeable for, or
that represent the right to receive, Stock or any such substantially
similar securities (other than pursuant to employee stock option plans
existing on, upon the conversion or exchange of convertible or exchangeable
securities outstanding as of, the date of this Agreement), without the
prior written consent of Xxxxxxx Xxxxx & Co.; provided that the Selling
Stockholder may transfer shares of common stock of the Company to American
International Group, Inc. ("AIG"), or to any subsidiary of AIG if the
transferee agrees to be bound by the restrictions set forth in this Section
2(d). For the avoidance of doubt, it is understood that the restrictions in
this Section 2(d) apply only to the shares of Company common stock directly
held by the Selling Stockholder, and do not apply to any shares held by
affiliates of the Selling Stockholder in connection with any asset
management or investment management business or otherwise in a fiduciary
capacity.
(e) The Selling Stockholder has not taken and will not take,
directly or indirectly, any action which is designed to or which has
constituted or which might reasonably be expected to cause or result in
stabilization or manipulation of the price of any security of the Company
to facilitate the sale or resale of the Shares.
(f) To the extent that any statements or omissions made in the
Registration Statement, the Base Prospectus, any Preliminary Prospectus,
the Pricing Prospectus, the Prospectus or any amendment or supplement
thereto, or any Issuer Free Writing Prospectus are made in reliance upon
and in conformity with written information furnished to the Company by the
Selling Stockholder expressly for use therein, which information consists
solely of the information set forth in Schedule IV hereto, such Base
Prospectus, Preliminary Prospectus, Pricing Prospectus, Prospectus and
Issuer Free Writing Prospectus and the Registration Statement did, and the
Prospectus and any further amendments or supplements to the Registration
Statement and the Prospectus, when they become effective or are filed with
the Commission, as the case may be, will conform in all material respects
to the requirements of the Securities Act and the rules and regulations of
the Commission thereunder and will not contain any untrue statement of a
material fact or omit to state any material fact required to be stated
therein or necessary to make the statements therein not misleading.
(g) In order to document the Underwriters' compliance with the
reporting and withholding provisions of the Tax Equity and Fiscal
Responsibility Act of 1982 with respect to the transactions herein
contemplated, the Selling Stockholder will deliver to you prior to or at
the First Time of Delivery (as hereinafter defined) a properly completed
and executed United States Treasury Department Form W-9 (or other
applicable form or statement specified by Treasury Department regulations
in lieu thereof).
12
Any certificate signed by an officer of the Selling Stockholder and
delivered to the Underwriters or to counsel for the Underwriters shall be deemed
to be a representation and warranty by the Selling Stockholder to each
Underwriter as to the matters set forth therein.
3. Purchase, Sale and Delivery of the Shares.
(a) Subject to the terms and conditions herein set forth, (i) the
Selling Stockholder agrees to sell to each of the Underwriters, and each of
the Underwriters agrees, severally and not jointly, to purchase from the
Selling Stockholder, at a purchase price per share of $52.149625, the
number of Firm Shares, excluding the Repurchase Shares (to be adjusted by
you so as to eliminate fractional shares), determined by multiplying the
aggregate number of Firm Shares to be sold by the Selling Stockholder, as
set forth on Schedule I(b), by a fraction, the numerator of which is the
aggregate number of Firm Shares to be purchased by such Underwriter as set
forth opposite the name of such Underwriter in Schedule I(a) hereto and the
denominator of which is the aggregate number of Firm Shares to be purchased
by all of the Underwriters from the Selling Stockholder hereunder and (ii)
in the event and to the extent that the Underwriters shall exercise the
election to purchase Optional Shares as provided below, the Selling
Stockholder agrees to sell to each of the Underwriters, and each of the
Underwriters agrees, severally and not jointly, to purchase from the
Selling Stockholder, at the per share purchase price set forth above, that
portion of the number of Optional Shares as to which such election shall
have been exercised (to be adjusted by you so as to eliminate fractional
shares) determined by multiplying such number of Optional Shares by a
fraction the numerator of which is the maximum number of Optional Shares
which such Underwriter is entitled to purchase as set forth opposite the
name of such Underwriter in Schedule I(a) hereto and the denominator of
which is the maximum number of Optional Shares that all of the Underwriters
are entitled to purchase hereunder.
(b) Subject to the terms and conditions set forth in the Stock
Offering Agreement, (i) the Selling Stockholder agrees to sell to each of
the Representatives, and each of the Representatives agrees, severally and
not jointly, to purchase the Repurchase Shares from the Selling
Stockholder, at a purchase price per share of $53.35, which price per share
shall be equal to the public offering price set forth on the front cover of
the Final Prospectus, and (ii) the Company agrees to purchase from the
Representatives the Repurchase Shares at a purchase price equal to the
public offering price per share set forth on the front cover of the Final
Prospectus.
(c) The Selling Stockholder hereby grants to the Underwriters the
right to purchase at their election up to the number of Optional Shares set
forth on Schedule I(b), at the per share purchase price set forth in clause
(a) above, for the sole purpose of covering sales of shares in excess of
the number of Firm Shares. Any such election to purchase Optional Shares
may be exercised only by written notice from you in accordance with Section
11 hereof, given within a period of 30 calendar days after the date of this
Agreement and setting forth the aggregate number of Optional Shares to be
purchased and the date on which such Optional Shares are to be delivered,
as determined by you but in no event earlier than the First Time of
Delivery (as defined in clause (e) hereof) or, unless you otherwise agree
in writing, earlier than two or later than ten business days after the date
of such notice, subject to the terms and conditions and in reliance upon
the representations and warranties herein set forth.
13
(d) Upon the authorization by you of the release of the Firm
Shares, the several Underwriters propose to offer for sale to the public
and to the Company their respective portions of Firm Shares upon the terms
and conditions set forth in the Prospectus.
(e) The Shares to be purchased by each Underwriter hereunder, in
definitive form, and in such authorized denominations and registered in
such names as the Representatives may request upon at least forty-eight
hours' prior notice to the Selling Stockholder shall be delivered by or on
behalf of the Selling Stockholder to the Representatives, through the
facilities of DTC, for the account of such Underwriter, against payment by
or on behalf of such Underwriter of the purchase price therefor by wire
transfer of Federal (same-day) funds to the account specified by the
Selling Stockholder to the Representatives at least forty-eight hours in
advance. As to any Shares that are in certificated form the Company will
cause the certificates representing such certificated Shares to be made
available for checking and packaging at least twenty-four hours prior to
the Time of Delivery (as defined below) with respect thereto at the office
of DTC or its designated custodian (the "DESIGNATED OFFICE"). The time and
date of such delivery and payment shall be, with respect to the Firm
Shares, 9:30 a.m., New York time, on March 15, 2010 or such other time and
date as the Representatives and the Selling Stockholder may agree upon in
writing, and, with respect to the Optional Shares, 9:30 a.m., New York
time, on the date specified by the Representatives in the written notice
given by the Representatives of the Underwriters' election to purchase such
Optional Shares, or such other time and date as the Representatives and the
Selling Stockholder may agree upon in writing. Such time and date for
delivery of the Firm Shares is herein called the "FIRST TIME OF DELIVERY",
such time and date for delivery of the Optional Shares, if not the First
Time of Delivery, is herein called the "SECOND TIME OF DELIVERY", and each
such time and date for delivery is herein called a "TIME OF DELIVERY".
(f) Delivery of the documents to be delivered at each Time of
Delivery by or on behalf of the parties hereto pursuant to Section 7 hereof
and payment for the Shares shall be made at the office of Xxxxx & XxXxxxx
LLP, 0000 Xxxxxx xx xxx Xxxxxxxx, Xxx Xxxx, XX 00000 (or such other place
as may be agreed to by the Underwriters and the Company) at, with respect
to the Firm Shares, 9:30 a.m. (New York time) on March 15, 2010, which date
and time may be postponed by agreement between the Underwriters, the
Company and the Selling Stockholder and with respect to the Option Shares,
9:30 a.m. (New York time) on the date specified in the written notice given
by the Representatives of the Underwriters' election to purchase such
Optional Shares, which date and time may be postponed by agreement between
the Underwriters and the Company.
(g) Time shall be of the essence, and delivery at the time and
place specified pursuant to this Agreement is a further condition of the
obligations of the Underwriters hereunder.
4. Covenants of the Company. The Company covenants with each of the
Underwriters as follows:
(a) To prepare the Final Prospectus as amended and supplemented
in relation to the applicable Shares in a form approved by the Underwriters
and to file timely and in the manner required such Final Prospectus
pursuant to Rule 424(b) under the Securities Act
14
(without reliance on Rule 424(b)(8)); to make no further amendment or any
supplement to the Registration Statement, any Preliminary Prospectus
(including any prospectus included in the Original Registration Statement
or amendment thereto at the time it became effective) or to the Final
Prospectus as amended or supplemented after the date hereof and prior to
the First Time of Delivery unless the Underwriters shall have had a
reasonable opportunity to review and comment upon any such amendment or
supplement prior to any filing thereof; to advise the Underwriters,
promptly after it receives notice thereof, of the time when any amendment
to the Registration Statement has been filed or any supplement to the Final
Prospectus or any amended Final Prospectus has been filed and to furnish
the Underwriters with copies thereof; to file promptly all reports and any
definitive proxy or information statements required to be filed by the
Company with the Commission pursuant to Section 13(a), 13(c), 14 or 15(d)
of the Exchange Act for so long as the delivery of a prospectus is required
in connection with the offering or sale of the Shares and, during such same
period, to advise the Underwriters, promptly after it receives notice
thereof, of (i) the issuance by the Commission of any stop order or of any
order preventing or suspending the use of the Final Prospectus or of any
examination pursuant to Section 8(e) of the Securities Act concerning the
Registration Statement, (ii) the suspension of the qualification of the
Shares for offering or sale in any jurisdiction or of the initiation or
threatening of any proceeding for any such purpose, (iii) any request by
the Commission for the amending or supplementing of the Registration
Statement or Final Prospectus or for additional information or (iv) the
Company becoming the subject of a proceeding under Section 8A of the
Securities Act in connection with the offering of the Shares; and, in the
event of the issuance of any stop order or of any order preventing or
suspending the use of the Final Prospectus or suspending any such
qualification, promptly to use its best efforts to obtain the withdrawal of
such order. The Company shall pay the required Commission filing fees
relating to the Shares within the time required by Rule 456(b)(1) of the
Securities Act without regard to the proviso therein and otherwise in
accordance with Rules 456(b) and 457(r) of the Securities Act.
(b) Not later than 12:00 p.m. (New York time) on the second
business day following the date the Shares are first released by the
Underwriters for sale to purchasers and from time to time, furnish at its
own expense to the Underwriters and to Xxxxx & XxXxxxx LLP, counsel to the
Underwriters, copies of the Final Prospectus (and all amendments and
supplements thereto) in each case as soon as available and in such
quantities as the Underwriters reasonably request for internal use and for
distribution to prospective purchasers. The Company will pay the expenses
of printing and distributing any Permitted Free Writing Prospectus (as
hereinafter defined) and the Prospectus and any amendments or supplements
thereto (including without limitation any costs associated with electronic
delivery of these materials).
(c) Furnish or deliver to the Underwriters and to Xxxxx & XxXxxxx
LLP, counsel for the Underwriters, without charge, signed copies of the
Original Registration Statement and of each amendment thereto (including
exhibits filed therewith or incorporated by reference therein and documents
incorporated or deemed to be incorporated by reference therein or otherwise
deemed to be a part thereof) and signed copies of all consents and
certificates of experts, and will also deliver to the Underwriters, without
charge, a conformed copy of the Original Registration Statement and of each
amendment thereto (without exhibits) for each of the Underwriters. The
copies of the Original Registration Statement and each
15
amendment thereto furnished to the Underwriters will be identical to the
electronically transmitted copies thereof filed with the Commission
pursuant to XXXXX, except to the extent permitted by Regulation S-T.
(d) Promptly to take such action as the Underwriters may
reasonably request from time to time to qualify the Shares for offering and
sale under the securities laws of such jurisdictions as the Underwriters
may request and to comply with such laws so as to permit the continuance of
sales and dealings therein in such jurisdictions in the United States for
as long as may be necessary to complete the distribution of the Shares;
provided that in connection therewith, the Company shall not be required to
qualify as a foreign corporation or otherwise subject itself to taxation or
service of process in any jurisdiction in which it is not otherwise so
qualified or subject.
(e) To make generally available to securityholders of the Company
as soon as practicable, but in any event not later than eighteen months
after the effective date of the Registration Statement (as defined in Rule
158(c) under the Securities Act), an earnings statement of the Company and
its subsidiaries (which need not be audited) complying with Section 11(a)
of the Securities Act and the rules and regulations thereunder (including,
at the option of the Company, Rule 158).
(f) To pay the required Commission filing fees relating to the
Shares within the time required by Rule 456(b)(1) under the Securities Act
and otherwise in accordance with Rules 456(b) and 457(r) under the
Securities Act.
(g) That none of the Company or any of its Affiliates will take,
directly or indirectly, any action which is designed to stabilize or
manipulate, or which constitutes or which might reasonably be expected to
cause or result in stabilization or manipulation, of the price of any
security of the Company in connection with the offering of the Shares.
(h) During the period beginning from the date hereof and
continuing to and including the date 90 days after the date of the Final
Prospectus, not to offer, sell, contract to sell, pledge, grant any option
to purchase, make any short sale or otherwise dispose, except as provided
hereunder, of any securities of the Company that are substantially similar
to the Shares, including but not limited to any options or warrants to
purchase shares of Stock or any securities that are convertible into or
exchangeable for, or that represent the right to receive, Stock or any such
substantially similar securities (other than pursuant to director or
employee stock option or equity plans existing on the date of this
Agreement, including for the avoidance of doubt the Company's 2009 Long
Term Equity Incentive Plan, or upon the conversion or exchange of
convertible or exchangeable securities outstanding as of the date of this
Agreement), without your prior written consent.
(i) To take such steps as shall be necessary to ensure that it
shall not become an "investment company" within the meaning of such term
under the Investment Company Act.
(j) The Company has complied and will comply with the
requirements of Rule 433 under the Securities Act applicable to any Issuer
Free Writing Prospectus relating to the
16
Shares, including timely filing with the Commission or retention where
required and legending.
(k) If at any time following issuance of an Issuer Free Writing
Prospectus there occurred or occurs an event or development as a result of
which such Issuer Free Writing Prospectus included or would include an
untrue statement of a material fact or omitted or would omit to state a
material fact necessary in order to make the statements therein, in the
light of the circumstances, not misleading, the Company has notified or
will notify promptly the Underwriters so that any use of such Issuer Free
Writing Prospectus may cease until it is amended or supplemented. The
foregoing two sentences do not apply to statements in or omissions from any
Issuer Free Writing Prospectus based upon and in conformity with written
information furnished to the Company by any Underwriter expressly for use
therein.
5. Further Covenants and Agreements.
(a) The Company and the Selling Stockholder each represent and
agree that, without the prior consent of the Representatives (such consent
not to be unreasonably withheld), it has not made and will not make any
offer relating to the Shares that would constitute a free writing
prospectus as defined in Rule 405 under the Securities Act; and each
Underwriter represents and agrees that, without the prior consent of the
Company, the Selling Stockholder and the Representatives (such consent not
to be unreasonably withheld), it has not made and will not make any offer
relating to the Securities that would constitute a free writing prospectus.
Any such free writing prospectus the use of which has been consented to by
the Company, the Selling Stockholder and the Representatives is listed on
Schedule II(a) hereto and is referred hereafter as a "PERMITTED FREE
WRITING PROSPECTUS".
(b) The Selling Stockholder and the Company acknowledge that (i)
the purchase and sale of the Shares pursuant to this Agreement is an
arm's-length commercial transaction between the Company and the Selling
Stockholder, on the one hand, and the several Underwriters, on the other
hand, (ii) in connection with the offering contemplated hereby and the
process leading to such transaction each Underwriter is and has been acting
solely as a principal and is not the agent or fiduciary of the Company or
the Selling Stockholder, or their respective stockholders, creditors,
employees or any other party, (iii) no Underwriter has assumed or will
assume an advisory or fiduciary responsibility in favor of the Company or
the Selling Stockholder with respect to the offering contemplated hereby or
the process leading thereto (irrespective of whether such Underwriter has
advised or is currently advising the Company or the Selling Stockholder on
other matters) and no Underwriter has any obligation to the Company or the
Selling Stockholder with respect to the offering contemplated hereby except
the obligations expressly set forth in this Agreement, (iv) the
Underwriters and their respective affiliates may be engaged in a broad
range of transactions that involve interests that differ from those of the
Company or the Selling Stockholder, and (v) the Underwriters have not
provided any legal, accounting, regulatory or tax advice with respect to
the offering contemplated hereby and each of the Company and the Selling
Stockholder have consulted their own legal, accounting, regulatory and tax
advisors to the extent it deemed appropriate.
17
6. Expenses. The Company and the Selling Stockholder covenant and
agree with one another and with the several Underwriters that (i) the Company
agrees to pay: (a) all costs and expenses incident to the preparation, printing,
shipping and distribution of the Registration Statement, the Base Prospectus,
any Preliminary Prospectus, the General Disclosure Package and the Final
Prospectus and any amendments or supplements thereto, and this Agreement; (b)
the fees and expenses of the Company's counsel and independent accountants; (c)
the fees and expenses of qualifying the Shares under the securities laws of the
several jurisdictions as provided in Section 4(d) and of preparing, printing and
distributing a Blue Sky Memorandum (including reasonable related fees and
expenses of counsel to the Underwriters in connection therewith), if any; (d)
any filings required to be made with FINRA (including filing fees and the
reasonable fees and expenses of counsel for the Underwriter relating to such
filings); (e) the costs and expenses of the Company and the reasonable expenses
of the Underwriters and any consultants in connection with the marketing and
offering of the Shares and 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, and the travel
and lodging expenses of the representatives and officers of the Company and any
such consultants; (f) any registration fees required to be paid by the Company
in connection with the registration of the Shares; and (g) all other costs and
expenses incident to the performance of the obligations of the Company under
this Agreement, and (ii) the Selling Stockholder agrees to pay: (a) the fees and
expenses of the Selling Stockholder's counsel; (b) any costs and expenses
incurred by the Selling Stockholder in connection with the marketing and
offering of the Shares and any "road show" undertaken in connection with the
marketing of the offering of the Shares, including, without limitation, expenses
associated with any travel and lodging expenses of the Selling Stockholder; and
(c) any stamp or transfer taxes in connection with the sale of the Shares to the
Underwriters and all other costs and expenses incident to the performance of the
obligations of the Selling Stockholder under this Agreement; provided in each
case that, except as provided in this Section 6, Section 8 and Section 10, the
Underwriters shall pay their own costs and expenses, including the costs and
expenses of their counsel.
7. Conditions of the Underwriters' Obligations. The obligations of the
Underwriters hereunder, as to the Shares to be delivered at each Time of
Delivery, are subject to the accuracy, when made and at and as of such Time of
Delivery, of the representations and warranties of the Company and the Selling
Stockholder contained herein, to the performance by the Company and the Selling
Stockholder of each of their obligations hereunder, and to each of the following
additional terms and conditions:
(a) The Final Prospectus shall have been filed with the
Commission pursuant to Rule 424(b) within the applicable time period
prescribed for such filing by the rules and regulations under the
Securities Act and in accordance with Section 4(a) hereof; no stop order
suspending the effectiveness of the Registration Statement or any part
thereof shall have been issued and no proceeding for that purpose shall
have been initiated or threatened by the Commission; and all requests for
additional information on the part of the Commission shall have been
complied with to the Underwriters' reasonable satisfaction.
(b) Xxxxxx Xxxx & Xxxxxxxx LLP shall have furnished to the
Underwriters its written opinion and negative assurance letter, as special
counsel to the Company, addressed to
18
the Underwriters and dated at such Time of Delivery, to the effect set
forth in Exhibit A hereto.
(c) Xxxx X. Xxxxxxxx, General Counsel to the Company, shall have
furnished to the Underwriters his written opinion addressed to the
Underwriters and dated at such Time of Delivery, to the effect set forth in
Exhibit B hereto.
(d) Xxxxxxxx & Xxxxxxxx LLP, counsel for the Selling Stockholder
shall have furnished to you their written opinion addressed to the
Underwriters and dated at such Time of Delivery, to the effect set forth in
Exhibit C hereto.
(e) Xxxxx & XxXxxxx LLP shall have furnished to the Underwriters
its written opinion, as counsel to the Underwriters, addressed to the
Underwriters and dated at such Time of Delivery, in form and substance
reasonably satisfactory to the Underwriters.
(f) The Underwriters shall have received, on each of the date
hereof and such Time of Delivery, a letter dated the date hereof and at
such Time of Delivery, as the case may be, to the effect set forth in
Exhibit D hereto, from PriceWaterhouseCoopers LLP, and with respect to each
such letter dated any such Time of Delivery as to such other matters as the
Representatives may reasonably request and in the form and substance
satisfactory to the Underwriters.
(g) The Company shall have furnished to the Underwriter a
certificate of the Company, signed by the Chief Financial Officer of the
Company, dated as of such Time of Delivery, in the form attached hereto as
Exhibit E.
(h) The Selling Stockholder shall have furnished to the
Underwriter a certificate, signed by an Officer of the Selling Stockholder,
dated as of such Time of Delivery, in the form attached hereto as Exhibit
F.
(i) The Company shall have furnished to the Underwriters on such
Time of Delivery its certificate, dated such Time of Delivery, executed by
its Chief Executive Officer and by its Chief Financial Officer, in form and
substance reasonably satisfactory to the Underwriters, to the effect that
(i) the representations, warranties and agreements of the Company in
Section 1 are true and correct as of the date given and as of such Time of
Delivery, (ii) the Company has complied in all material respects with all
its agreements contained herein to be performed prior to or on such Time of
Delivery and (iii) the conditions set forth in Sections 7(k) and 7(m) have
been fulfilled.
(j) The Underwriters shall have received on such Time of
Delivery, certificates of the Selling Stockholder, dated such Time of
Delivery, executed by an authorized officer of the Selling Stockholder, in
the form and substance reasonably satisfactory to the Underwriters, to the
effect that the representations, warranties and agreements of the Selling
Stockholder in Section 2 are true and correct as of the date given and as
of such Time of Delivery; and the Selling Stockholder has complied in all
material respects with all its agreements contained herein to be performed
prior to or on such Time of Delivery.
19
(k) (i) Neither the Company nor any of its subsidiaries shall
have sustained since the date of the latest audited financial statements
included in the General Disclosure Package and the Final Prospectus any
loss or interference with its business from fire, explosion, flood or other
calamity, whether or not covered by insurance, or from any labor dispute or
court or governmental action, order or decree, otherwise than as set forth
or contemplated in the General Disclosure Package and the Final Prospectus
or (ii) since such date there shall not have been (A) any addition, or any
development involving a prospective addition, to the Company's consolidated
reserve for losses and loss adjustment expense or (B) any change in the
capital stock (other than issuances pursuant to a stock compensation plan
of the Company disclosed in the General Disclosure Package), or any change
in the short-term debt or long-term debt of the Company or any of its
subsidiaries or any change, or any development involving a prospective
change, in or affecting the general affairs, management, financial
position, stockholders' equity or results of operations of the Company and
its subsidiaries, otherwise than as set forth or contemplated in the Final
Prospectus, the effect of which, in any such case described in clause (i)
or (ii), is, in the reasonable judgment of the Underwriters, so material
and adverse as to make it impracticable or inadvisable to proceed with the
offering or the delivery of the Shares being delivered on such Time of
Delivery on the terms and in the manner contemplated in the General
Disclosure Package and the Final Prospectus.
(l) Subsequent to the execution and delivery of this Agreement
there shall not have occurred any of the following: (i) trading in the
shares of the common stock of the Company, or in securities generally on
the New York Stock Exchange shall have been suspended or limited or minimum
or maximum prices shall have been established on such exchange by the
Commission, by such exchange or by any other regulatory body or
governmental authority having jurisdiction; (ii) a banking moratorium shall
have been declared by United States federal or New York authorities; (iii)
the United States shall have become engaged in hostilities, there shall
have been an escalation in hostilities involving the United States, or
there shall have been a declaration of a national emergency or war by the
United States; (iv) there shall have occurred a material disruption in
securities settlement or clearance services; or (v) there shall have
occurred such a material adverse change in general economic, political or
financial conditions (or the effect of international conditions on the
financial markets in the United States shall be such) as to make it, in
each case, in the reasonable judgment of the Underwriters, impracticable or
inadvisable to proceed with the offering or delivery of the Shares being
delivered on such Time of Delivery on the terms and in the manner
contemplated in the General Disclosure Package and the Final Prospectus.
(m) Subsequent to the execution and delivery of this Agreement,
(i) no downgrading shall have occurred in the rating accorded to the
financial strength or credit of the Company, the insurance financial
strength or issuer credit of the Insurance Subsidiaries or the debt
securities of the Company by any "nationally recognized statistical rating
organization", as that term is defined by the Commission for purposes of
Rule 436(g)(2) of the Securities Act and (ii) no such rating organization
shall have made an initial public announcement that it has under
surveillance or review, with possible negative implications, its rating of
the financial strength of the Company, the insurance financial strength or
issuer credit of the Insurance Subsidiaries or the debt securities of the
Company.
20
(n) The Underwriters shall have received executed copies of an
agreement from the directors and executive officers of the Company listed
in Schedule III hereto that includes "lock-up" provisions to the effect set
forth in Exhibit G hereto.
(o) At such Time of Delivery, counsel for the Underwriters shall
have been furnished with such documents and opinions as it may reasonably
require for the purpose of enabling it to pass upon the sale of the Shares
as herein contemplated, or in order to evidence the accuracy of any of the
representations or warranties, or the fulfillment of any of the conditions,
herein contained; and all proceedings taken by the Company and the Selling
Stockholder in connection with the sale of the Shares as herein
contemplated shall be reasonably satisfactory in form and substance to the
Representatives and counsel for the Underwriters.
8. Indemnification and Contribution.
(a) The Company shall indemnify and hold harmless each
Underwriter and each person, if any, who controls any Underwriter, within
the meaning of the Securities Act or the Exchange Act, from and against any
loss, claim, damage or liability, joint or several, or any action in
respect thereof (including, but not limited to, any loss, claim, damage,
liability or action relating to purchases and sales of the Shares), to
which the Underwriters or any such controlling person may become subject,
insofar as such loss, claim, damage, liability or action arises out of, or
is based upon, (i) any untrue statement or alleged untrue statement of a
material fact contained in any Preliminary Prospectus, any Issuer Free
Writing Prospectus, the General Disclosure Package, the Final Prospectus or
in any amendment or supplement thereto or any "issuer information" filed or
required to be filed pursuant to Rule 433(d) under the Securities Act or
(ii) the omission or alleged omission to state in any Preliminary
Prospectus, any Issuer Free Writing Prospectus, the General Disclosure
Package, the Final Prospectus or in any amendment or supplement thereto or
any "issuer information" filed or required to be filed pursuant to Rule
433(d) under the Securities Act any material fact required to be stated
therein or necessary to make the statements therein not misleading; and
shall reimburse the Underwriters and controlling person promptly upon
demand for any documented legal or other expenses reasonably incurred by
the Underwriters or any such controlling person in connection with
investigating or defending or preparing to defend against any such loss,
claim, damage, liability or action as such expenses are incurred; provided,
however, that the Company shall not be liable in any such case to the
extent that any such loss, claim, damage, liability or action arises out
of, or is based upon, any untrue statement or alleged untrue statement or
omission or alleged omission made in any Preliminary Prospectus, any Issuer
Free Writing Prospectus, the General Disclosure Package, the Final
Prospectus, in reliance upon and in conformity with the written information
furnished to the Company by or on behalf of the Underwriters concerning the
Underwriters specifically for inclusion therein, which information consists
solely of the information set forth in Schedule V hereto.
(b) The Selling Stockholder shall indemnify and hold harmless
each Underwriter, and each person, if any, who controls any Underwriter,
within the meaning of the Securities Act or the Exchange Act, from and
against any loss, claim, damage or liability, joint or several, or any
action in respect thereof (including, but not limited to, any loss, claim,
damage, liability or action relating to purchases and sales of the Shares),
to which the
21
Underwriters or any such controlling person may become subject, insofar as
such loss, claim, damage, liability or action arises out of, or is based
upon, (i) any untrue statement or alleged untrue statement of a material
fact contained in any Preliminary Prospectus, any Issuer Free Writing
Prospectus, the General Disclosure Package, the Final Prospectus or in any
amendment or supplement thereto in reliance upon and in conformity with
written information furnished to the Company by the Selling Stockholder or
(ii) the omission or alleged omission, in reliance upon and in conformity
with written information furnished to the Company by the Selling
Stockholder, to state in any Preliminary Prospectus, any Issuer Free
Writing Prospectus, the General Disclosure Package, the Final Prospectus or
in any amendment or supplement thereto any material fact necessary to make
the statements therein not misleading; and shall reimburse the Underwriters
and each such controlling person promptly upon demand for any legal or
other expenses reasonably incurred by the Underwriters or any such
controlling person in connection with investigating or defending or
preparing to defend against any such loss, claim, damage, liability or
action as such expenses are incurred.
(c) The Underwriters, severally and not jointly, shall indemnify
and hold harmless the Company and the Selling Stockholder, and each person,
if any, who controls the Company or the Selling Stockholder within the
meaning of the Securities Act or the Exchange Act from and against any
loss, claim, damage or liability, joint or several, or any action in
respect thereof, to which the Company, the Selling Stockholder or any such
controlling person may become subject, insofar as such loss, claim, damage,
liability or action arises out of, or is based upon, (i) any untrue
statement or alleged untrue statement of a material fact contained in any
Preliminary Prospectus, any Issuer Free Writing Prospectus, the General
Disclosure Package, the Final Prospectus or in any amendment or supplement
thereto, or (ii) the omission or alleged omission to state in any
Preliminary Prospectus, any Issuer Free Writing Prospectus, the General
Disclosure Package, the Final Prospectus or in any amendment or supplement
thereto, any material fact necessary to make the statements therein not
misleading, but in each case only to the extent that such untrue statement
or alleged untrue statement or omission or alleged omission was made in
reliance upon and in conformity with the written information furnished to
the Company or the Selling Stockholder by or on behalf of the Underwriters
specifically for inclusion therein, which information consists solely of
the information set forth in Schedule V hereto, and shall reimburse the
Company or the Selling Stockholder and any such controlling person promptly
upon demand for any legal or other expenses reasonably incurred by the
Company or the Selling Stockholder or any such controlling person in
connection with investigating or defending or preparing to defend against
any such loss, claim, damage, liability or action as such expenses are
incurred. The foregoing indemnity agreement is in addition to any liability
which the Underwriters may otherwise have to the Company, or the Selling
Stockholder or any such controlling person.
(d) Promptly after receipt by an indemnified party under this
Section 8 of notice of any claim or the commencement of any action, the
indemnified party shall, if a claim in respect thereof is to be made
against the indemnifying party under this Section 8, notify the
indemnifying party in writing of the claim or the commencement of that
action; provided, however, that the failure to notify the indemnifying
party shall not relieve the indemnifying party from any liability which the
indemnifying party may have under this Section 8 except to the extent it
has been materially prejudiced by such failure and, provided, further, that
the failure to notify the indemnifying party shall not relieve it from any
liability which it may have
22
to an indemnified party otherwise than under this Section 8. If any such
claim or action shall be brought against an indemnified party, and it shall
notify the indemnifying party thereof, the indemnifying party shall be
entitled to participate therein and, to the extent that it wishes, jointly
with any other similarly notified indemnifying party, to assume the defense
thereof with counsel reasonably satisfactory to the indemnified party.
After notice from the indemnifying party to the indemnified party of its
election to assume the defense of such claim or action, the indemnifying
party shall not be liable to the indemnified party under this Section 8 for
any legal or other expenses subsequently incurred by the indemnified party
in connection with the defense thereof other than reasonable costs of
investigation; provided, however, that the Underwriters shall have the
right to employ separate counsel to represent jointly the Underwriters and
their respective officers, employees and controlling persons who may be
subject to liability arising out of any claim in respect of which indemnity
may be sought by the Underwriters against the Company under this Section 8
if, in the reasonable judgment of the Underwriters, based on the advice of
counsel, it is advisable for the Underwriters and such officers, employees
and controlling persons to be jointly represented by separate counsel, and
in that event the reasonable fees and expenses of such separate counsel
shall be paid by the Company (it being understood that the Company shall
not be liable for the expenses of more than one separate counsel (together
with local counsel)). No indemnifying party shall, (i) without the prior
written consent of the indemnified parties (which consent shall not be
unreasonably withheld) settle or compromise or consent to the entry of any
judgment with respect to any pending or threatened claim, action, suit or
proceeding in respect of which indemnification or contribution may be
sought hereunder (whether or not the indemnified parties are actual or
potential parties to such claim or action) unless such settlement,
compromise or consent (1) includes an unconditional release of each
indemnified party from all liability arising out of such claim, action,
suit or proceeding and (2) does not include a statement as to or an
admission of fault, culpability or failure to act by or on behalf of any
indemnified party, or (ii) be liable for any settlement of any such action
effected without its written consent (which consent shall not be
unreasonably withheld), but if settled with its written consent or if there
be a final judgment for the plaintiff in any such action, the indemnifying
party agrees to indemnify and hold harmless any indemnified party from and
against any loss of liability by reason of such settlement or judgment.
(e) If the indemnification provided for in this Section 8 shall
for any reason be unavailable or insufficient to hold harmless an
indemnified party under Section 8(a), (b) or (c) in respect of any loss,
claim, damage or liability, or any action in respect thereof, referred to
therein, then each relevant indemnifying party shall, in lieu of
indemnifying such indemnified party, contribute to the amount paid or
payable by such indemnified party as a result of such loss, claim, damage
or liability, or action in respect thereof, (i) in such proportion as shall
be appropriate to reflect the relative benefits received by the Company and
the Selling Stockholder on the one hand and the Underwriters on the other
from the offering of the Shares, or (ii) if the allocation provided by
clause 8(e)(i) is not permitted by applicable law, in such proportion as is
appropriate to reflect not only the relative benefits referred to in clause
8(e)(i) but also the relative fault of the Company and the Selling
Stockholder on the one hand and the Underwriters on the other with respect
to the statements or omissions or alleged statements or alleged omissions
that resulted in such loss, claim, damage or liability (or action in
respect thereof), as well as any other relevant equitable considerations.
The relative benefits received
23
by the Company and the Selling Stockholder on the one hand and the
Underwriters on the other with respect to such offering shall be deemed to
be in the same proportion as the total net proceeds from the offering of
the Shares purchased under this Agreement (before deducting expenses)
received by the Selling Stockholder on the one hand, and the total
discounts and commissions received by the Underwriters with respect to the
Shares purchased under this Agreement, on the other hand, bear to the total
gross proceeds from the offering of the Shares under this Agreement. The
relative fault shall be determined by reference to whether the untrue or
alleged untrue statement of a material fact or omission or alleged omission
to state a material fact relates to information supplied by the Company,
the Selling Stockholder or the Underwriters, the intent of the parties and
their relative knowledge, access to information and opportunity to correct
or prevent such statement or omission. The Company, the Selling Stockholder
and the Underwriters agree that it would not be just and equitable if the
amount of contributions pursuant to this Section 8(e) were to be determined
by pro rata allocation or by any other method of allocation that does not
take into account the equitable considerations referred to herein. The
amount paid or payable by an indemnified party as a result of the loss,
claim, damage or liability, or action in respect thereof, referred to above
in this Section 8(e) shall be deemed to include, for purposes of this
Section 8(e), any legal or other expenses reasonably incurred by such
indemnified party in connection with investigating or defending any such
action or claim. Notwithstanding the provisions of this Section 8(e), no
Underwriters shall be required to contribute any amount in excess of the
amount by which the total price at which the Shares underwritten by it were
offered to the public exceeds the amount of any damages which such
Underwriter has otherwise been previously required to pay by reason of such
untrue or alleged untrue statement or omission or alleged omission. No
person guilty of fraudulent misrepresentation (within the meaning of
Section 11(f) of the Securities Act) shall be entitled to contribution from
any person who was not guilty of such fraudulent misrepresentation.
9. Termination. The obligations of the Underwriters hereunder may be
terminated by the Underwriters by notice given to and received by the Company
and the Selling Stockholder prior to delivery of and payment for the Shares, if,
prior to that time, any of the events described in Sections 7(k), (l) or (m)
shall have occurred or if the Underwriters shall decline to purchase such Shares
for any reason permitted under this Agreement. In such case, the Company and the
Selling Stockholder shall have no liability hereunder except as provided by
Sections 6, 8 and 10 hereof.
10. Reimbursement of Underwriters' Expenses. (a) if (i) the Selling
Stockholder shall fail to tender the Shares for delivery to the Underwriters for
any reason other than a breach by the Underwriters of their representations
herein or obligations hereunder or (ii) the Underwriters shall decline to
purchase the Shares as a result of (x) the failure of any of the conditions
herein to be satisfied due to a breach of any of the representations, warranties
or covenants by the Selling Stockholder, (y) the failure by counsel for the
Selling Stockholder to furnish its written opinion pursuant to Section 7(d) of
this Agreement or (z) any other acts or matters solely within the control of the
Selling Stockholder, then the Selling Stockholder shall reimburse the
Underwriters for the reasonable fees and expenses of their counsel and for such
other out-of-pocket expenses as shall have been reasonably incurred by them in
connection with this Agreement and the proposed purchase of the Shares, and upon
demand, the Selling Stockholder shall pay the full amount of such reasonable
fees and expenses to the Underwriters; and (b) if the Underwriters shall decline
to purchase the Shares for any other reason permitted under this Agreement
(including the termination of this
24
Agreement pursuant to Section 9 but excluding the failure of any of the
conditions herein to be satisfied as a result of a breach by the Selling
Stockholder or the Underwriters of their respective representations, warranties
or covenants herein) other than those specified in (a) above, the Company shall
reimburse the Underwriters for the reasonable fees and expenses of their counsel
and for such other out-of-pocket expenses as shall have been reasonably incurred
by them in connection with this Agreement and the proposed purchase of the
Shares, and upon demand, the Company shall pay the full amount thereof to the
Underwriters.
11. Notices, etc. All statements, requests, notices and agreements
hereunder shall be in writing, and:
(a) If to the Underwriters, shall be delivered or sent by mail,
telex or facsimile transmission to Xxxxxxx Xxxxx & Co. at 000 Xxxx Xxxxxx,
Xxx Xxxx, XX 00000, Attention: Registration Department (Fax: 000-000-0000);
to Xxxxx Fargo Securities, LLC, at 000 Xxxx Xxxxxx, Xxx Xxxx, XX 00000,
Attention: Equity Syndicate Department (Fax: 000-000-0000); and to Xxxxxxx
Lynch, Pierce, Xxxxxx & Xxxxx Incorporated, at Xxx Xxxxxx Xxxx, XX, Xxx
Xxxx 00000, attention of Syndicate Department, with a copy to ECM Legal;
with a copy (which shall not constitute notice) to Xxxxx & XxXxxxx
LLP, 0000 Xxxxxx xx xxx Xxxxxxxx, Xxx Xxxx, XX 00000, Attention: Xxxxxxx
Xxxxx, Esq. (Fax: 000-000-0000; Telephone: 000-000-0000);
(b) if to the Company, shall be delivered or sent by mail, telex
or facsimile transmission to it at 00 Xxxx Xxxxxx, Xxx Xxxx, XX 00000,
Attention: General Counsel (Fax: 000-000-0000; Telephone: 000-000-0000);
with a copy (which shall not constitute notice) to Xxxxxx, Xxxx &
Xxxxxxxx LLP, 000 Xxxx Xxxxxx, Xxx Xxxx, XX 00000, Attention: Xxxx Xxxxxxx,
Esq. (Fax: 000-000-0000; Telephone: 000-000-0000).
(c) If to the Selling Stockholder, shall be delivered or sent by
mail, telex or facsimile transmission to American Home Assurance at 000
Xxxxx Xxxxxx, Xxx Xxxx, XX 00000, Attention: General Counsel (Fax:
000-000-0000);
with a copy (which shall not constitute notice) to American
International Group, Inc., at 00 Xxxx Xxxxxx, Xxx Xxxx, XX 00000,
Attention: General Counsel (Fax: 000-000-0000) and Xxxxxxxx & Xxxxxxxx LLP,
000 Xxxxx Xxxxxx, Xxx Xxxx, XX 00000, Attention: Xxxxxxx X. Xxxxxx, Esq.,
Xxxxxx X. Xxxxxxxx Xx., Esq. (Fax: 000-000-0000, Telephone: 000-000-0000).
Any notice of a change of address or facsimile transmission number
must be given by the Company, the Selling Stockholders or the Underwriters,
as the case maybe, in writing at least three days in advance of such
change.
12. Persons Entitled to Benefit of Agreement. This Agreement shall
inure to the benefit of and be binding upon the Underwriters, the Selling
Stockholder, the Company and their respective successors, and to the extent
provided in Section 8 hereof, to each person, if any, who is a controlling
person, within the meaning of the Securities Act or the Exchange Act. This
Agreement and the terms and provisions hereof are for the sole benefit of only
those persons, except that (i) the representations, warranties, indemnities and
agreements of the Company and the Selling Stockholder
25
contained in this Agreement shall also be deemed to be for the benefit of the
directors, officers and employees of the Underwriters and the person or persons,
if any, who control the Underwriters within the meaning of Section 15 of the
Securities Act and (ii) the representations and warranties of the Underwriters
in this Agreement and the indemnity agreement of the Underwriters contained in
Section 8(c) of this Agreement shall be deemed to be for the benefit of
directors, officers and employees of the Company and the Selling Stockholder,
and any person controlling the Company and the Selling Stockholder within the
meaning of Section 15 of the Securities Act. Nothing contained in this Agreement
is intended or shall be construed to give any person, other than the persons
referred to in this Section 12, any legal or equitable right, remedy or claim
under or in respect of this Agreement or any provision contained herein.
13. Default of One or More of the Several Underwriters. If any one or
more of the several Underwriters shall fail or refuse to purchase Shares that it
or they have agreed to purchase hereunder on the First Time of Delivery, and the
aggregate number of Shares which such defaulting Underwriter or Underwriters
agreed but failed or refused to purchase does not exceed 10% 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 Shares set forth
opposite their respective names on Schedule I(a) bears to the aggregate number
of Shares set forth opposite the names of all such non-defaulting Underwriters,
or in such other proportions as may be specified by the Underwriters with the
consent of the non-defaulting Underwriters, to purchase the Shares which such
defaulting Underwriter or Underwriters agreed but failed or refused to purchase
on such date. If any one or more of the Underwriters shall fail or refuse to
purchase Shares and the aggregate number of Shares with respect to which such
default occurs exceeds 10% of the aggregate number of Shares to be purchased on
the First Time of Delivery, and arrangements satisfactory to the Underwriters
and the Selling Stockholders for the purchase of such Shares are not made within
48 hours after such default, this Agreement shall terminate without liability on
the part of any non-defaulting Underwriter or the Company or the Selling
Stockholders, except that the provisions of Section 6, Section 8 and Section 10
(which shall only apply with respect to the non-defaulting Underwriters) shall
at all times be effective and shall survive such termination, but nothing herein
shall relieve a defaulting Underwriter from liability for its default. In any
such case either the Underwriters or the Company shall have the right to
postpone such Time of Delivery but in no event for longer than seven days in
order that the required changes, if any, to the Final Prospectus or any other
documents or arrangements may be effected.
As used in this Agreement, the term "UNDERWRITER" shall be deemed to
include any person substituted for a defaulting Underwriter under this Section
13. Any action taken under this Section 13 shall not relieve any defaulting
Underwriter from liability in respect of any default of such Underwriter under
this Agreement.
14. Survival. The respective indemnities, representations, warranties
and agreements of the Company and the Underwriters contained in this Agreement
or made by or on behalf of them, respectively, pursuant to this Agreement, shall
survive the delivery of and payment for the Shares and shall remain in full
force and effect, regardless of any termination or cancellation of this
Agreement or any investigation made by or on behalf of any of them or any person
controlling any of them.
26
15. Definition of the Term "Business Day". For purposes of this
Agreement, "BUSINESS DAY" means any day on which the New York Stock Exchange,
Inc. is open for trading.
16. Governing Law. THIS AGREEMENT SHALL BE GOVERNED BY, AND CONSTRUED
IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK.
17. Counterparts. This Agreement may be executed in one or more
counterparts and, if executed in more than one counterpart, the executed
counterparts shall each be deemed to be an original but all such counterparts
shall together constitute one and the same instrument.
18. Headings. The headings herein are inserted for convenience of
reference only and are not intended to be part of, or to affect the meaning or
interpretation of, this Agreement.
SIGNATURE PAGE FOLLOWS
27
If the foregoing correctly sets forth the agreement between the Company and
the Underwriters, please indicate your acceptance in the space provided for that
purpose below.
Very truly yours,
TRANSATLANTIC HOLDINGS, INC.
By: /s/ Xxxx X. Xxxxxxxx
------------------------------------
Name: Xxxx X. Xxxxxxxx
Title: Senior Vice President and
General Counsel
AMERICAN HOME ASSURANCE COMPANY
By: /s/ Xxxxx X. Xxxxxxxxx
------------------------------------
Name: Xxxxx X. Xxxxxxxxx
Title: Authorized Representative
28
Accepted and agreed by:
/s/ Xxxxxxx, Sachs & Co.
-------------------------------------
(Xxxxxxx, Xxxxx & Co.)
Accepted and agreed by:
XXXXX FARGO SECURITIES, LLC
By: /s/ Xxxxx Xxxxxx
---------------------------------
Name: Xxxxx Xxxxxx
Title: Director
Accepted and agreed by:
By: XXXXXXX LYNCH, PIERCE, XXXXXX &
XXXXX INCORPORATED
By: /s/ Xxxxxxx Xxxx
---------------------------------
Xxxxxxx Xxxx
Global Head of Financial
Institutions
29
SCHEDULE I (A)
NUMBER OF SHARES
UNDERWRITERS TO BE PURCHASED
------------ ----------------
Xxxxxxx, Sachs & Co. 3,762,598
Xxxxx Fargo Securities, LLC 3,762,598
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx
Incorporated 941,497
----------------
TOTAL 8,466,693
SCHEDULE I (B)
SELLING STOCKHOLDER
NUMBER OF FIRM MAXIMUM NUMBER OF OPTIONAL
SELLING STOCKHOLDER SHARES TO BE SOLD SHARES TO BE SOLD
------------------- ----------------- --------------------------
American Home Assurance Company 8,466,693 725,969
SCHEDULE II(A)
(I) ISSUER FREE WRITING PROSPECTUSES INCLUDED IN THE GENERAL DISCLOSURE PACKAGE
The Company's Free Writing Prospectus dated Xxxxx 0, 0000
(XX) OTHER ISSUER FREE WRITING PROSPECTUSES
The Company's Free Writing Prospectus dated Xxxxx 0, 0000
XXXXXXXX XX(X)
ADDITIONAL FILINGS
None
SCHEDULE II(C)
ORALLY CONVEYED PRICING INFORMATION
1. Public Offering price: $53.35 per share
2. Number of Shares offered: 8,466,693 shares
SCHEDULE III
LOCK UP AGREEMENT PARTIES
1. Xxxxxx X. Xxxxxx
2. Xxxxxxx Xxxxx
3. Xxxx X. Xxxxx
4. Xxxxxxx X. Xxxxxx
5. Xxxxxx X. Xxxxxxxx
6. Xxxxxx X. Xxxxx
7. Xxxx X. Xxxxxxxx
8. Xxx X. Xxxxxxxxxxx
9. Xxxx X. Xxxx
10. Xxxx X. XxXxxxxx
11. Xxxxxxx X. Press
12. Xxxxxx X. Xxxxxx
13. Xxxxxx Xxxxxxxx
14. Xxx Xxxxxxxxxxx
SCHEDULE IV
INFORMATION FURNISHED TO THE COMPANY BY THE SELLING STOCKHOLDER
The Selling Stockholder has furnished to the Company for use in the Final
Prospectus:
(a) The information provided under the caption "Selling Stockholder" in
the Final Prospectus, other than the last paragraph thereof.
SCHEDULE V
INFORMATION PROVIDED BY THE UNDERWRITERS:
The Underwriters have furnished to the Company for use in the Final Prospectus:
(a) The seventh paragraph under the caption "Underwriting" in the Final
Prospectus concerning the terms of the offering.
(b) The eighth, ninth and tenth paragraphs under the caption
"Underwriting" in the Final Prospectus, concerning stabilizing and
syndicate covering transactions by the Underwriters.
EXHIBIT A
FORM OF OPINION XXXXXX, XXXX & XXXXXXXX LLP
1. The Company is a validly existing corporation and is in good standing
under the laws of the State of Delaware with the requisite corporate power and
authority to conduct its business as described in the General Disclosure Package
and the Final Prospectus.
2. Insofar as the statements in the General Disclosure Package and Final
Prospectus purport to describe specific provisions of the Shares, such
statements present in all material respects an accurate summary of such
provisions.
3. Based solely on such counsel's review of the agreements, instruments,
judgments or decrees and except as disclosed in the General Disclosure Package
and Final Prospectus, the performance by the Company of this Agreement and the
consummation of the transactions herein contemplated, does not breach the terms
of any agreement or instrument identified to such counsel by the Company as
being material to the Company, to which the Company or any of its subsidiaries
is a party or by which the Company or any of its subsidiaries is bound or to
which any of the property or assets of the Company or any of its subsidiaries is
subject, nor will such actions violate the provisions of the Certificate of
Incorporation or By-laws of the Company or any statute or any order, judgment or
decree of any court or other agency of government identified to such counsel by
the Company as constituting all orders, judgments or decrees binding on the
Company.
4. Any required filings of the Final Prospectus, the Pricing Prospectus and
any Issuer Free Writing Prospectus identified in Schedule II(a) hereto have been
made in the manner and time period required by Rule 424(b) under the Securities
Act (without reference to Rule 424(b)(8)).
5. Insofar as the statements made in the Pricing Prospectus and the Final
Prospectus under the captions "Description of Capital Stock," insofar as they
purport to constitute a summary of the terms of the Shares, under the caption
"Certain Agreements with AIG," and "Underwriting" insofar as they purport to
describe specific provisions of the Shares and terms of the laws and documents
referred to therein, such statements present in all material respects an
accurate summary of such provisions, terms and documents.
6. The execution, delivery by the Company of the Underwriting Agreement and
the performance of its obligations thereunder have been duly authorized by the
Company, and the Underwriting Agreement has been duly executed and delivered by
the Company.
7. The Company is not and, after giving effect to the offering and sale of
the Shares as described in the General Disclosure Package and identified in
Schedule I(a) hereto and the Final Prospectus, will not be an "investment
company" that is required to be registered under the Investment Company Act of
1940, as amended (the "Investment Company Act"). For purposes of this paragraph
7, the term "investment company" has the meaning ascribed to such term in the
Investment Company Act.
8. Such counsel shall state that no facts came to such counsel's attention
in the course of its review that cause such counsel to believe that the
Registration Statement, as of its effective date, and the Final Prospectus, as
of the date of the Final Prospectus, and any further amendments and supplements
thereto, as applicable, and each of the documents incorporated therein by
reference which were filed under the Exchange Act, as of their respective dates
(in each case, other than the financial statements and related notes and
schedules and other information of an accounting or financial nature contained
therein, as to which such counsel need express no opinion), were not
appropriately responsive in all material respects to the requirements of the
Securities Act, as applicable and the applicable rules and regulations of the
Commission thereunder.
9. Further, such counsel shall also state that no facts came to such
counsel's attention in the course of its review that have caused such counsel to
believe (i) that the Registration Statement, or any amendment thereto, as of its
effective date contained an untrue statement of a material fact or omitted to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading; or (ii) that the documents included in the
General Disclosure Package and identified in Schedule I(a) hereto, taken as a
whole, as of the Applicable Time, contained an untrue statement of a material
fact or omitted to state a material fact necessary in order to make the
statements therein, in the light of circumstances under which they were made,
not misleading; or (iii) that the Final Prospectus, as of the date of the Final
Prospectus and as of the date of such opinion, contained an untrue statement of
a material fact or omitted 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. In each case, however, such counsel need express no view
or belief with respect to (a) the financial statements, and notes and schedules
thereto, included in, or incorporated by reference in, the Registration
Statement, the General Disclosure Package and the Final Prospectus and (b) other
information of a financial or accounting nature included in, incorporated by
reference in or omitted from the Registration Statement, the General Disclosure
Package or the Final Prospectus.
10. Such counsel shall also state that based solely on the representations
and warranties of the Company contained in this Agreement, it is of the view
that the Registration Statement has become effective under the Securities Act.
In addition, such counsel shall state that, to such counsel's knowledge, based
solely upon telephonic confirmation from the Staff of the Commission, as of the
time of such confirmation no stop order suspending the effectiveness of the
Registration Statement has been issued
under the Securities Act and no proceedings for that purpose have been
instituted or are pending or threatened by the Commission.
11. Such counsel shall state that in the course of the preparation by the
Company of the Registration Statement, the General Disclosure Package and the
Final Prospectus (other than the documents incorporated by reference therein),
they participated in conferences with certain of the officers and other
representatives of, and the independent public accountants for, the Company.
Given the limitations inherent in the role of outside counsel and the
independent verification of factual matters and the character of determinations
involved in the process of preparing the Registration Statement, the General
Disclosure Package and the Final Prospectus, such counsel need not pass upon and
need not assume any responsibility for the accuracy, completeness or fairness of
the statements contained in the Registration Statement, the General Disclosure
Package, the Final Prospectus or in any of the documents incorporated therein by
reference which were filed under the Exchange Act and need not have made an
independent check or verification thereof except as set forth in Section 5
above.
EXHIBIT B
FORM OF OPINION OF GENERAL COUNSEL OF THE COMPANY
(i) Each of the Company and its subsidiaries Xxxxxx Reinsurance Company
("XXXXXX"), Transatlantic Reinsurance Company ("TRC") and Trans Re Zurich
("ZURICH") (each, a "SUBSIDIARY") has been duly incorporated and is duly
qualified or licensed to do business as a foreign corporation in good standing
in each jurisdiction in which the conduct of its business or its ownership or
leasing of property requires such qualification or licensing, except to the
extent that the failure to be so qualified, licensed or in good standing would
not have a Material Adverse Effect. All of the issued and outstanding capital
stock of each Subsidiary has been duly authorized and validly issued, is fully
paid and non-assessable and is owned by the Company, directly or through
subsidiaries, free and clear of any security interest, mortgage, pledge, lien,
encumbrance or claim.
(ii) The Company has an authorized capitalization as set forth in the
General Disclosure Package and the Final Prospectus. All of the issued shares of
capital stock of the Company (including the Shares being delivered at such Time
of Delivery) have been duly authorized and validly issued and are fully paid and
non-assessable. None of the outstanding shares of common stock of the Company
were issued in violation of any preemptive or other similar right of any
shareholder of the Company; and, except as set forth in the General Disclosure
Package and the Final Prospectus, no options, warrants or other rights to
purchase, agreements or other obligations to issue, or rights to convert any
obligations into or exchange any securities for, shares of capital stock of or
ownership interests in the Company are outstanding.
(iii) Each of TRC and Xxxxxx is duly licensed or authorized as an insurer
in the State of New York, or is subject to no liability or disability material
to the Company and its subsidiaries considered as a whole by reason of the
failure to be so licensed or authorized in New York; the Company, TRC and Xxxxxx
have made all required filings under applicable insurance holding company
statutes of the State of New York; the Company, TRC and Xxxxxx have all other
necessary authorizations, approvals, orders, consents, licenses, certificates,
permits, registrations or qualifications of and from all insurance regulatory
authorities of the State of New York to conduct their respective businesses as
described in the General Disclosure Package and the Final Prospectus, or are
subject to no material liability or disability by reason of the failure to have
such authorizations, approvals, orders, consents, licenses, certificates,
permits, registrations or qualifications; and to such counsel's knowledge
neither the Company, TRC nor Xxxxxx has received any notification from any
insurance regulatory authority to the effect that any additional authorization,
approval, order, consent, license, certificate, permit, registration or
qualification from such insurance regulatory authority is needed to be obtained
by the Company, TRC or Xxxxxx in any case where it could be reasonably expected
that (x) the Company, TRC or Xxxxxx would in fact be required either to obtain
any such additional authorization, approval, order, consent, license,
certificate, permit, registration or qualification or cease or otherwise limit
writing certain business and (y) obtaining such authorization, approval, order,
consent, license, certificate, permit, registration or qualification or limiting
such business would have a Material Adverse Effect (such counsel being entitled
to rely in respect of matters of fact relating to the opinion in this clause
upon certificates of officers of the Company or its subsidiaries, provided that
such counsel shall state that he believes that both the Underwriters and he are
justified in relying upon such certificates).
(iv) To such counsel's knowledge, each of TRC and Xxxxxx is in compliance
with the requirements of the insurance laws and regulations of the State of New
York and has filed all notices, reports, documents or other information required
to be filed thereunder, or is subject to no material liability or disability by
reason of the failure to so comply or file (such counsel being entitled to rely
in respect of matters of fact relating to the opinion in this clause upon
certificates of officers of the Company or its subsidiaries, provided that such
counsel shall state that such counsel believes that both the Underwriters and
such counsel are justified in relying upon such certificates, and in respect of
the opinion in this clause upon opinions of local counsel provided that such
counsel shall state that such counsel believes that both you and such counsel
are justified in relying upon such opinions).
(v) All descriptions in the General Disclosure Package and the Final
Prospectus of contracts and other documents to which the Company or any of its
subsidiaries is a party are accurate in all material respects; to such counsel's
knowledge, there are no franchises, contracts, indentures, mortgages, loan
agreements, notes, leases or other instruments that would be required to be
described in the General Disclosure Package or the Final Prospectus that are not
described or referred to in the General Disclosure Package or the Final
Prospectus other than those described or referred to therein, and the
descriptions thereof are correct in all material respects.
(vi) To such counsel's knowledge, neither the Company nor any of its
subsidiaries is in violation of its charter or by-laws and no default by the
Company or any of its subsidiaries exists in the due performance or observance
of any material obligation, agreement, covenant or condition contained in any
contract, indenture, mortgage, loan agreement, note, lease or other agreement or
instrument that is described or referred to in the General Disclosure Package or
the Final Prospectus.
(vii) No consent, approval, authorization, order, registration or
qualification of or with any federal or New York governmental agency or body or
any Delaware governmental agency or body acting pursuant to the Delaware General
Corporation Law or, to our knowledge, any federal or New York court or any
Delaware court acting pursuant to the Delaware General Corporation Law is
required for the consummation by the Company of the transactions contemplated by
this Agreement, except such as have been obtained under the Securities Act and
such consents, approvals, authorizations,
registrations or qualifications as may be required under state securities or
Blue Sky laws in connection with the purchase and distribution of the Shares by
the Underwriters.
(viii) Each of the documents filed by the Company pursuant to the Exchange
Act, and incorporated by reference into the Registration Statement, the General
Disclosure Package and the Final Prospectus as of the date hereof, when it was
filed, complied in all material respects with the requirements of the Exchange
Act and the applicable rules and regulations of the Commission thereunder,
except that such counsel need not express any opinion as to the financial
statements and related notes and schedules and other financial data included or
incorporated by reference therein or excluded therefrom.
(ix) Except as disclosed in the General Disclosure Package and the Final
Prospectus, the execution and delivery of this Agreement, the issuance and sale
of the Shares, and the consummation of the transactions therein contemplated do
not and will not conflict with or constitute or result in a breach of, or
default under, (a) any judgment, order or decree known to such counsel of any
domestic government, governmental instrumentality or regulatory authority or
court having jurisdiction over the Company, any subsidiary, or any of their
property, or (b) any provision of any indenture, mortgage, deed of trust, loan
or credit agreement or similar agreement or instrument known to such counsel to
which the Company or any subsidiary is a party or by which they or any part of
their property is bound, except in each case (a) and (b) for such conflicts,
breaches or defaults as would not have a Material Adverse Effect.
(x) To such counsel's knowledge, there are no legal or governmental
proceedings pending to which the Company or any of its subsidiaries is a party
or of which any property or assets of the Company or any of its subsidiaries is
the subject which, singularly or in the aggregate, would be reasonably likely to
have a Material Adverse Effect, and to such counsel's knowledge, no such
proceedings are threatened or contemplated by governmental authorities or
threatened by others, except as would not, singly or in the aggregate, be
reasonably likely to have a Material Adverse Effect.
(xi) Except as described in the General Disclosure Package or the Final
Prospectus, there are no restrictions upon the declaration or payment of any
dividend or distribution on any shares of capital stock of any of the Company's
subsidiaries pursuant to the charter or by-laws of any of them, any agreement or
other instrument to which any of them is a party or by which any of them is
bound, or any order, law, rule, regulation, judgment or determination of any
court, governmental agency or body (including, without limitation, any insurance
regulatory agency or body) or arbitrator having jurisdiction over any of them.
Such counsel shall also state that while such counsel has not itself
checked the accuracy and completeness of, or otherwise verified, and is not
passing upon and assumes no responsibility for, the accuracy or completeness of
the statements contained in the
Registration Statement, the General Disclosure Package or the Final Prospectus
except to the extent described in such counsel's opinion above, no facts came to
such counsel's attention in the course of its review that have caused such
counsel to believe (i) that the Registration Statement, or any amendment
thereto, as of its effective date 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 (ii) that the
documents included in the General Disclosure Package, as of the Applicable Time,
contained any untrue statement of a material fact or omitted to state any
material fact necessary in order to make the statements therein, in the light of
circumstances under which they were made, not misleading; or (iii) that the
Final Prospectus, as of the date of the Final Prospectus and as of the date of
such opinion, contained any untrue statement of a material fact or omitted to
state any material fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made, not misleading. In
each case, however, such counsel need express no view or belief with respect to
(a) the financial statements, and notes and schedules thereto, included in, or
incorporated by reference in, the Registration Statement, the General Disclosure
Package and the Final Prospectus and, (b) other financial data or information
included in, incorporated by reference in or omitted from the Registration
Statement, the General Disclosure Package or the Final Prospectus.
EXHIBIT C
FORM OF OPINION OF COUNSEL TO THE SELLING STOCKHOLDER
March __, 2010
Xxxxxxx, Xxxxx & Co.,
Xxxxx Fargo Securities, LLC
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated
As Representatives of the several Underwriters
named in Schedule I(a) hereto,
c/o Goldman, Sachs & Co.
00 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
c/o Wells Fargo Securities, LLC
000 Xxxx Xxxxxx
0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
c/o Merrill Lynch, Pierce, Xxxxxx & Xxxxx Incorporated
Xxx Xxxxxx Xxxx
Xxx Xxxx, Xxx Xxxx 00000
Ladies and Gentlemen:
In connection with the several purchases today by you and the other
Underwriters named in Schedule 1(a) to the Underwriting Agreement, dated March
__, 2010 (the "UNDERWRITING AGREEMENT"), among American Home Assurance Company,
a New York insurance corporation ("AHAC", the "SELLING STOCKHOLDER"),
Transatlantic Holdings, Inc., a Delaware corporation (the "COMPANY"), and you,
as Representatives of the several Underwriters named therein (the
"UNDERWRITERs"), of [XX,XXX,XXX] shares of the Company's Common Stock, par value
$1.00 per share (the "COMMON
STOCK"), consisting of _____ shares of Common Stock being purchased from AHAC
(the "SHARES"), we, as counsel for the Selling Stockholder, have examined such
corporate records, certificates and other documents, and such questions of law,
as we have considered necessary or appropriate for the purposes of this opinion.
Upon the basis of such examination, it is our opinion that:
(1) The Underwriting Agreement has been duly authorized, executed and
delivered by the Selling Stockholder.
(2) The execution, delivery and performance by the Selling Stockholder of
its obligations under the Underwriting Agreement will not (a) violate the
Selling Stockholder's certificate of incorporation or by-laws, or (b) violate
any Covered Laws.
(3) All regulatory consents, authorizations, approvals and filings by or
with any governmental authority or court that are required to be obtained or
made by the Selling Stockholder under the Covered Laws for the execution,
delivery and performance of their obligations under the Underwriting Agreement
have been obtained or made.
(4) Immediately prior to each Time of Delivery (as defined in the
Underwriting Agreement), the Selling Stockholder will have good and valid title
to a security interest in the Shares to be sold pursuant to the Underwriting
Agreement, free and clear of all liens, encumbrances, equities or claims, and
upon payment therefor and delivery to the Depository Trust Company ("DTC") or
its agent of the Shares registered in the name of Cede & Co. ("CEDE") or such
other nominee as may be designated by DTC, both as provided for in the
Underwriting Agreement, and the crediting of the Shares to the Underwriters'
accounts with DTC, Cede & Co. or such other nominee designated by DTC will be a
"protected purchaser" of the Shares (as defined in Section 8-303 of the Uniform
Commercial Code as adopted in the State of New York (the "UCC")), the
Underwriters will acquire a valid "security entitlement" (within the meaning of
Section 8-501 of the UCC) to the Shares, and no action based on an "adverse
claim" (as defined in Section 8-102 of the UCC) may be asserted against the
Underwriters with respect to such security entitlement (assuming that the
Underwriters are without notice of any such adverse claim).
The foregoing opinion is limited to the Federal laws of the United States
and the laws of the State of New York, and we are expressing no opinion as to
the effect of the laws of any other jurisdiction.
We are expressing no opinion in paragraphs (2) and (3) above, insofar as
performance by the Selling Stockholder of its obligations under the Underwriting
Agreement is concerned, as to bankruptcy, insolvency, rehabilitation,
liquidation, fraudulent transfer, reorganization, moratorium and similar laws of
general applicability related to or affecting creditors' rights. Also, for
purposes of the opinions in paragraphs (2) and (3) above, "COVERED LAWS" means
the Federal laws of the United States and the laws of the State of New York
(including the rules or regulations promulgated thereunder
or pursuant thereto), that in our experience normally are applicable to the
Selling Stockholder and transactions such as those contemplated by the
Underwriting Agreement, provided that the term "Covered Laws" does not include
Federal or state securities laws, other antifraud laws and fraudulent transfer
laws, tax laws, the Employment Retirement Income Security Act of 1974 and
related laws, antitrust laws or any law, rule or regulation that is applicable
to the Selling Stockholder, the Underwriting Agreement or the transactions
contemplated thereby solely because such law, rule or regulation is part of a
regulatory regime applicable to the specific assets or business of the Selling
Stockholder or its affiliates.
In connection with our opinion in paragraph (2), (i) our consideration of
any of the agreements referred to in such paragraph that are not governed by New
York law has been limited to a review of such agreements, and we have analyzed
such agreements as though New York law were the law governing such agreements,
and (ii) we express no opinion, however, as to whether the execution, delivery
or performance by the Selling Stockholder of the Underwriting Agreement will
constitute a breach of, or default under, any covenant, restriction or provision
with respect to financial ratios or tests or any aspect of the financial
condition or results of operations of the Selling Stockholder or any of its
subsidiaries.
We have relied as to certain matters upon information obtained from public
officials, officers of the Selling Stockholder and American International Group,
Inc., and other sources believed by us to be responsible, and we have assumed
that the signatures on all documents examined by us are genuine, assumptions
which we have not independently verified.
Very truly yours,
EXHIBIT D
FORM OF ACCOUNTANTS' COMFORT LETTER
March 9, 2010
Transatlantic Holdings, Inc.
00 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
and
Xxxxxxx, Xxxxx & Co.,
Xxxxx Fargo Securities, LLC
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated
As representatives of the several underwriters
Ladies and Gentlemen:
We have audited:
1. the consolidated financial statements of Transatlantic Holdings, Inc.
and its subsidiaries (collectively, the "Company") as of December 31,
2009 and 2008 and for each of the three years in the period ended
December 31, 2009 included in the Company's annual report on Form 10-K
for the year ended December 31, 2009 (the "Form 10-K"),
2. the related financial statement schedules included in the Form 10-K
and
3. the effectiveness of the Company's internal control over financial
reporting as of December 31, 2009.
The consolidated financial statements and financial statement schedules referred
to above are all incorporated by reference in the registration statement (No.
333-155811) on Form S-3 filed by the Company under the Securities Act of 1933
(the "Act"); our report with respect thereto is also incorporated by reference
in such registration statement. Such registration statement, including the
prospectus dated May 28, 2009 and the preliminary prospectus supplement dated
March 9, 2010, is herein referred to as the "Registration Statement."
In connection with the Registration Statement:
1. We are an independent registered public accounting firm with respect to the
Company within the meaning of the Act and the applicable rules and
regulations thereunder adopted by the Securities and Exchange Commission
("SEC") and the Public Company Accounting Oversight Board (United States)
("PCAOB").
2. In our opinion, the consolidated financial statements and financial
statement schedules audited by us and incorporated by reference in the
Registration Statement comply as to form in all material respects with the
applicable accounting requirements of the Act and the Securities Exchange
Act of 1934 and the related rules and regulations adopted by the SEC.
3. We have not audited any financial statements of the Company as of any date
or for any period subsequent to December 31, 2009. Therefore, we are unable
to and do not express any opinion on the financial position, results of
operations or cash flows as of any date or for any period subsequent to
December 31, 2009. Also, we have not audited the Company's internal control
over financial reporting as of any date subsequent to December 31, 2009.
Therefore, we do not express any opinion on the Company's internal control
over financial reporting as of any date subsequent to December 31, 2009.
4. For purposes of this letter, we have read the minutes of the 2009 meetings
of the Board of Directors and the Audit Committee of the Board of Directors
of the Company and as set forth in the minute books at March 5, 2010,
officials of the Company having advised us that the minutes of all such
meetings through that date were set forth therein, except for the minutes
of the December 9, 2009 Board of Directors, the December 18, 2009 Executive
Committee of the Board of Directors, and the February 4, 2010 and February
12, 2010 Compensation Committee of the Board of Directors meetings, which
were not approved in final form, for which agendas were provided to us;
officials of the Company have represented that such agendas include all
substantive actions taken at such meetings.
5. Company officials have advised us that no consolidated financial data as of
any date or for any period subsequent to December 31, 2009 are available;
accordingly, the procedures carried out by us with respect to changes in
financial statement items after December 31, 2009 have, of necessity, been
limited. We have inquired of certain officials of the Company who have
responsibility for financial and accounting matters as to whether at March
8, 2010 there was any change in preferred stock or common stock, or in
short-term or long-term debt of the Company as compared with amounts shown
in the December 31, 2009 consolidated balance sheet incorporated by
reference in the Registration Statement. On the basis of these inquiries
and our reading of the minutes as described in 4, nothing came to our
attention that caused us to believe that there was any such change,
increase or decrease, except in all instances for changes, increases or
decreases which the Registration Statement discloses have occurred or may
occur.
6. For purposes of this letter, we have also read the items identified by you
on the attached copies of pages from the preliminary prospectus supplement
forming part of the Registration Statement and copies of pages from the
Company's Form 10-K incorporated by reference therein and have performed
the following procedures, which were applied as indicated with respect to
the letters explained below. We make no comment as to whether the SEC would
view any non-GAAP financial information included or incorporated by
reference in the Registration Statement as being compliant with the
requirements of Regulation G or Item 10 of Regulation S-K.
With respect to Tickmarks A, B, and C below, we make no comment as to the
appropriateness of the Company's methodology for developing net prior
period reserve adjustments, prior period reserve strengthening, catastrophe
losses, annualized pre/after tax yield on average cash and invested assets,
change in foreign exchange rates in percentages,
underwriting gain, loss ratios, expense ratios, and combined ratios. In
addition, we make no comment as to the reasons for any variances disclosed
in the "Management's Discussion and Analysis of Financial Condition and
Results of Operations."
A Compared with a corresponding amount included in the Company's audited
consolidated financial statements, incorporated by reference in the
Registration Statement, and found them to be in agreement.
B Compared with a corresponding amount in or recomputed directly from
the Company's accounting records or from applicable amounts included
in or derived from a schedule prepared by the Company from its
accounting records for the respective period, and found them to be in
agreement. We (a) compared the amounts on the schedule to
corresponding amounts appearing in the accounting records and found
such amounts to be in agreement and (b) determined that the schedule
was mathematically correct.
C Recomputed using applicable amounts included in the Company's audited
consolidated financial statements, incorporated by reference in the
Registration Statement, and found them to be in agreement.
D Recomputed book value per share using applicable amounts from the
Company's audited consolidated financial statements and found the per
share amounts to be in agreement.
E Compared with a corresponding amount in or recomputed directly from
the Company's accounting records or from applicable amounts included
in or derived from a schedule prepared by the Company from its
accounting records for the respective period, and found them to be in
agreement. We (a) compared the amounts on the schedule to
corresponding amounts appearing in the accounting records and found
such amounts to be in agreement and (b) determined that the schedule
was mathematically correct. We make no comment regarding the
appropriateness of the classification of net loss reserves, premiums
written, commissions nor premiums balances receivable by line of
business.
F Compared with a corresponding amount included in the Company's
accounting records and found such amount to be (0.2%).
G Compared with a corresponding amount included in the Company's
accounting records and found such amount to be $1.0 million.
H Compared with a corresponding amount included in the Company's
accounting records and found such amount to be ($1.0) million.
I We recalculated the amounts by reference to the Company's audited
consolidated financial statements, incorporated by reference in the
Registration Statement, after giving effect to the stock repurchase by
Transatlantic Holdings, Inc. However, we make no comment as to whether
the repurchase of stock by Transatlantic Holdings, Inc. will actually
occur.
J Compared to a schedule prepared by the Company from its accounting
records and found such amounts to be in agreement. We (a) compared the
amounts on the schedule to corresponding amounts appearing in the
accounting records and found such amounts to be in agreement and (b)
determined that the schedule was mathematically correct.
It should be noted that net operating income, NOI per Common Share
(diluted) and operating return on equity, (collectively, the "Non-GAAP
measures"), are not measures of operating performance or liquidity
defined by generally accepted accounting principles and may not be
comparable to similarly titled measures presented by other companies.
We make no comment about the company's definition, calculation or
presentation of the Non-GAAP measures or their usefulness for any
purposes.
K Compared with a corresponding amount included in the Company's
accounting records and found such amount to be $4,440,069.
L Compared with a corresponding amount included in the Company's
accounting records and found such amount to be $5,265,946.
8. Our audit of the consolidated financial statements for the periods referred
to in the introductory paragraph of this letter comprised audit tests and
procedures deemed necessary for the purpose of expressing an opinion on
such financial statements taken as a whole. For none of the periods
referred to therein, or any other period, did we perform audit tests for
the purpose of expressing an opinion on individual balances of accounts or
summaries of selected transactions such as those enumerated above, and,
accordingly, we express no opinion thereon.
9. It should be understood that we make no representations regarding questions
of legal interpretation or regarding the sufficiency for your purposes of
the procedures enumerated in the second preceding paragraph; also, such
procedures would not necessarily reveal any material misstatement of the
amounts or percentages listed above. Further, we have addressed ourselves
solely to the foregoing data as set forth or incorporated by reference in
the Registration Statement and make no representations regarding the
adequacy of disclosure or regarding whether any material facts have been
omitted.
10. This letter is solely for the information of the addressees and to assist
the underwriters in conducting and documenting their investigation of the
affairs of the Company in connection with the offering of the securities
covered by the Registration Statement, and is not to be used, circulated,
quoted, or otherwise referred to within or without the underwriting group
for any other purpose, including but not limited to the registration,
purchase, or sale of securities, nor is it to be filed with or referred to
in whole or in part in the Registration Statement or any other document,
except that reference may be made to it in the underwriting agreement or in
any list of closing documents pertaining to the offering of the securities
covered by the Registration Statement.
Very truly yours,
PricewaterhouseCoopers, LLP
EXHIBIT E
FORM OF CFO CERTIFICATE
TRANSATLANTIC HOLDINGS, INC.
CHIEF FINANCIAL OFFICER'S CERTIFICATE
I, Xxxxxx Xxxxxxxx, do hereby certify that I am the Executive Vice
President and Chief Financial Officer of Transatlantic Holdings, Inc., a
Delaware corporation (the "Company"), and solely on behalf of the Company, and
not in my individual capacity, do hereby certify that:
1) I am providing this certificate in connection with the offering of XX
million shares of common stock, par value $1.00 of the Company, by the
selling stockholder, as described in that certain Registration
Statement on Form S-3, as amended by post effective amendment No. 1
(File No. 333-155811) (together with the prospectus dated May 28, 2009
and the preliminary prospectus supplement dated March __, 2010, the
"Registration Statement");
2) I am familiar with the accounting, operations and records systems of
the Company and its wholly-owned subsidiaries;
3) (a) To the best of my knowledge:
(i) At March __, 2010, there was no decrease greater than 10% in
total shareholders' equity as compared with the amounts shown on
the December 30, 2009 audited consolidated balance sheet
incorporated by reference in the Registration Statement, except
as a result of events that have been disclosed in the
Registration Statement as having occurred or may occur;
(ii) For the period from January 1 to March __, 2010 there was no
decrease greater than 15% in either consolidated net revenue or
consolidated net income as compared to the corresponding period
in 2009, except as a result of events that have been disclosed in
the Registration Statement as having occurred or may occur.
IN WITNESS WHEREOF, I have hereunto subscribed my name this __th day of
March, 2010.
----------------------------------------
Name: Xxxxxx Xxxxxxxx
Title: Executive Vice President and
Chief Financial Officer
EXHIBIT F
AMERICAN HOME ASSURANCE COMPANY
Officer's Certificate
I, ____________, _____________ of American Home Assurance Company, a New
York domiciled insurance company (the "COMPANY"), hereby certify that:
The only agreements or instruments to which the Company is a party or by
which it is bound which contain any covenant or restriction which limits or
restricts its freedom to sell, transfer or otherwise dispose of any
securities of Transatlantic Holdings, Inc. are listed on Schedule I hereto.
IN WITNESS WHEREOF, I have hereunto signed my name.
Dated: March __, 2010
SCHEDULE I
1. Stockholders' Agreement, dated June 4, 2009 by and among American
International Group, Inc., American Home Assurance Company and Transatlantic
Holdings, Inc.
EXHIBIT G
TRANSATLANTIC HOLDINGS, INC.
FORM OF LOCK-UP AGREEMENT
March __, 2010
Xxxxxxx, Xxxxx & Co.,
Xxxxx Fargo Securities, LLC
Xxxxxxx Lynch, Pierce, Xxxxxx & Xxxxx Incorporated
As Representatives of the several Underwriters
named in Schedule I(a) hereto,
c/o Goldman, Sachs & Co.
00 Xxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
c/o Wells Fargo Securities, LLC
000 Xxxx Xxxxxx
0xx Xxxxx
Xxx Xxxx, Xxx Xxxx 00000
c/o Merrill Lynch, Pierce, Xxxxxx & Xxxxx Incorporated
Xxx Xxxxxx Xxxx
Xxx Xxxx, Xxx Xxxx 00000
Re: Transatlantic Holdings, Inc. - Lock-Up Agreement
Ladies and Gentlemen:
The undersigned understands that you, as representatives (the
"Representatives"), propose to enter into an Underwriting Agreement on behalf of
the several Underwriters named in Schedule I(a) to such agreement (collectively,
the "Underwriters"), with the selling stockholders named in Schedule I(b) to
such agreement and Transatlantic Holdings, Inc., a Delaware corporation (the
"Company"), providing for a public offering of the common stock, par value $1.00
par share (the "Shares") of the Company by the selling stockholders pursuant to
a Registration Statement on Form S-3 (No. 333-155811), to be filed with the
Securities and Exchange Commission (the "SEC").
In consideration of the agreement by the Underwriters to offer and sell the
Shares, and of other good and valuable consideration the receipt and sufficiency
of which is hereby acknowledged, the undersigned agrees that without the prior
written consent of Xxxxxxx, Xxxxx & Co. and Xxxxx Fargo Securities, LLC , during
the period beginning from the date hereof and continuing to and including the
date 45 days after the date of the Final Prospectus covering the public offering
of the Shares, the undersigned will not offer, sell, contract to sell, pledge,
grant any option to purchase, make any short sale or otherwise dispose of any
shares of common stock
1
of the Company, or any options or warrants to purchase any shares of common
stock of the Company, or any securities convertible into, exchangeable for or
that represent the right to receive shares of common stock of the Company,
whether now owned or hereinafter acquired, owned directly by the undersigned
(including holding as a custodian) or with respect to which the undersigned has
beneficial ownership as such term is used in the rules and regulations of the
SEC promulgated under Section 16 of the Securities Act of 1934, as amended
(collectively the "Undersigned's Shares").
The foregoing restriction is expressly agreed to preclude the undersigned
from engaging in any hedging or other transaction which is designed to or which
reasonably could be expected to lead to or result in a sale or disposition of
the Undersigned's Shares even if such Shares would be disposed of by someone
other than the undersigned. Such prohibited hedging or other transactions would
include without limitation any short sale or any purchase, sale or grant of any
right (including without limitation any put or call option) with respect to any
of the Undersigned's Shares or with respect to any security that includes,
relates to, or derives any significant part of its value from such Shares.
Notwithstanding the foregoing, the undersigned may transfer the
Undersigned's Shares (i) as a bona fide gift or gifts, provided that the donee
or donees thereof agree to be bound in writing by the restrictions set forth
herein, (ii) to any trust for the direct or indirect benefit of the undersigned
or the immediate family of the undersigned, provided that the trustee of the
trust agrees to be bound in writing by the restrictions set forth herein, and
provided further that any such transfer shall not involve a disposition for
value, or (iii) with the prior written consent of the Representatives on behalf
of the Underwriters. For purposes of this Lock-Up Agreement, "immediate family"
shall mean any relationship by blood, marriage or adoption, not more remote than
first cousin. In addition, notwithstanding the foregoing, if the undersigned is
a corporation, the corporation may transfer the capital stock of the Company to
any wholly owned subsidiary of such corporation; provided, however, that in any
such case, it shall be a condition to the transfer that the transferee execute
an agreement stating that the transferee is receiving and holding such capital
stock subject to the provisions of this Agreement and there shall be no further
transfer of such capital stock except in accordance with this Agreement, and
provided further that any such transfer shall not involve a disposition for
value and that any such transfer is not required to be reported in any public
report or filing with the Securities and Exchange Commission, or otherwise. The
undersigned now has, and, except as contemplated by clause (i), (ii), or (iii)
above, for the duration of this Lock-Up Agreement will have, good and marketable
title to the Undersigned's Shares, free and clear of all liens, encumbrances,
and claims whatsoever. 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 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
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.
Very truly yours,
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Exact Name of Stockholder
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Authorized Signature
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Title
