ALLIED WORLD ASSURANCE COMPANY HOLDINGS, LTD 5.50% Notes due 2020 UNDERWRITING AGREEMENT November 9, 2010 Merrill Lynch, Pierce, Fenner & Smith Incorporated Wells Fargo Securities, LLC
Exhibit 1.1
ALLIED WORLD ASSURANCE COMPANY HOLDINGS, LTD
$300,000,000
5.50% Notes due 2020
November 9, 2010
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated
▇▇▇▇▇ Fargo Securities, LLC
▇▇▇▇▇ Fargo Securities, LLC
November 9, 2010
▇▇▇▇▇▇▇ LYNCH, PIERCE, ▇▇▇▇▇▇ & ▇▇▇▇▇
INCORPORATED
▇▇▇▇▇ FARGO SECURITIES, LLC
As Representatives of the several Underwriters
c/o
MERRILL LYNCH, PIERCE, ▇▇▇▇▇▇ & ▇▇▇▇▇
INCORPORATED
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
AND
▇▇▇▇▇ FARGO SECURITIES, LLC
▇▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
INCORPORATED
▇▇▇▇▇ FARGO SECURITIES, LLC
As Representatives of the several Underwriters
c/o
MERRILL LYNCH, PIERCE, ▇▇▇▇▇▇ & ▇▇▇▇▇
INCORPORATED
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
AND
▇▇▇▇▇ FARGO SECURITIES, LLC
▇▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Ladies and Gentlemen:
Introductory. Allied World Assurance Company Holdings, Ltd, a Bermuda exempted company (the
“Company”), proposes to issue and sell to the several underwriters named in Schedule A (the
“Underwriters”), acting severally and not jointly, the respective amounts set forth in such
Schedule A of $300,000,000 aggregate principal amount of the Company’s 5.50% Senior Notes due 2020
(the “Notes”). ▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated (“MLPF&S”) and
▇▇▇▇▇ Fargo Securities, LLC (“▇▇▇▇▇ Fargo”) have agreed to act as representatives of the
several Underwriters (in such capacity, the “Representatives”) in connection with the
offering and sale of the Notes.
The Notes will be issued pursuant to an indenture, dated as of November 15, 2010 (the
“Base Indenture”), to be entered into between the Company and The Bank of New York Mellon,
as trustee (the “Trustee”). Certain terms of the Notes will be established pursuant to a
supplemental indenture (the “Supplemental Indenture”) to the Base Indenture (together with
the Base Indenture, the “Indenture”). The Notes will be issued in book-entry form in the
name of Cede & Co., as nominee of The Depository Trust Company (the “Depositary”), pursuant
to a Letter of Representations, to be dated on or before the Closing Date (as defined in Section 2
below) (the “DTC Agreement”), among the Company, the Trustee and the Depositary.
The Company has prepared and filed with the Securities and Exchange Commission (the
“Commission”) a registration statement on Form S-3 (File No. 333-148409), which contains a
base prospectus (the “Base Prospectus”), to be used in connection with the public offering
and sale of debt securities, including the Notes, and other securities of the Company under the
Securities Act of 1933, as amended, and the rules and regulations promulgated thereunder
(collectively, the “Securities Act”), and the offering thereof from time to time in
accordance with
1
Rule 415 under the Securities Act. Such registration statement, including the financial
statements, exhibits and schedules thereto, in the form in which it became effective under the
Securities Act, including any required information deemed to be a part thereof at the time of
effectiveness pursuant to Rule 430B under the Securities Act, is called the “Registration
Statement.” The term “Prospectus” shall mean the final prospectus supplement relating
to the Notes, together with the Base Prospectus, that is first filed pursuant to Rule 424(b) after
the date and time that this Agreement is executed (the “Execution Time”) by the parties
hereto. The term “Preliminary Prospectus” shall mean any preliminary prospectus supplement
relating to the Notes, together with the Base Prospectus, that is first filed with the Commission
pursuant to Rule 424(b). Any reference herein to the Registration Statement, the Preliminary
Prospectus or the Prospectus shall be deemed to refer to and include the documents that are or are
deemed to be incorporated by reference therein pursuant to Item 12 of Form S-3 under the Securities
Act prior to 3:00 p.m. on November 9, 2010 (the “Initial Sale Time”). All references in
this Agreement to the Registration Statement, the Preliminary Prospectus, the Prospectus, or any
amendments or supplements to any of the foregoing, shall include any copy thereof filed with the
Commission pursuant to its Electronic Data Gathering, Analysis and Retrieval System
(“▇▇▇▇▇”).
All references in this Agreement to financial statements and schedules and other information
which is “contained,” “included” or “stated” (or other references of like import) in the
Registration Statement, the Prospectus or the Preliminary Prospectus shall be deemed to mean and
include all such financial statements and schedules and other information which is or is deemed to
be incorporated by reference in the Registration Statement, the Prospectus or the Preliminary
Prospectus, as the case may be, prior to the Initial Sale Time; and all references in this
Agreement to amendments or supplements to the Registration Statement, the Prospectus or the
Preliminary Prospectus shall be deemed to include the filing of any document under the Securities
Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder
(collectively, the “Exchange Act”), which is or is deemed to be incorporated by reference
in the Registration Statement, the Prospectus or the Preliminary Prospectus, as the case may be,
after the Initial Sale Time.
The Company hereby confirms its agreements with the Underwriters as follows:
Section 1. Representations and Warranties of the Company
The Company hereby represents, warrants and covenants to each Underwriter as of the date
hereof, as of the Initial Sale Time and as of the Closing Date (in each case, a “Representation
Date”), as follows:
a) Compliance with Registration Requirements. The Company meets the requirements for use of
Form S-3 under the Securities Act. The Registration Statement has become effective under the
Securities Act and 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 or threatened by the Commission,
and any request on the part of the Commission for additional information has been complied with.
In addition, the Indenture has been duly
2
qualified under the Trust Indenture Act of 1939, as amended, and the rules and regulations
promulgated thereunder (the “Trust Indenture Act”).
At the respective times the Registration Statement and any post-effective amendments thereto
(including the filing with the Commission of the Company’s Annual Report on Form 10-K for the year
ended December 31, 2009 (the “Annual Report on Form 10-K”)) became effective and at each
Representation Date, the Registration Statement and any amendments thereto (i) complied and will
comply in all material respects with the requirements of the Securities Act, and (ii) did not and
will not contain any untrue statement of a material fact or omit to state a material fact required
to be stated therein or necessary to make the statements therein not misleading. At the date of
the Prospectus and at the Closing Date, neither the Prospectus nor any amendments or supplements
thereto included or will include an untrue statement of a material fact or omitted or will omit to
state a material fact necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading. Notwithstanding the foregoing, the
representations and warranties in this subsection shall not apply to (i) statements in or omissions
from the Registration Statement or any post-effective amendment or the Prospectus or any amendments
or supplements thereto made in reliance upon and in conformity with information furnished to the
Company in writing by any of the Underwriters through the Representatives expressly for use
therein, it being understood and agreed that the only such information furnished by any Underwriter
through the Representatives consists of the information described as such in Section 8 hereof and
(ii) that part of the Registration Statement that shall constitute the Statement of Eligibility
(Form T-1) of the Trustee under the Trust Indenture Act.
Each Preliminary Prospectus and the Prospectus, at the time each was filed with the
Commission, complied in all material respects with the Securities Act, and the Preliminary
Prospectus and the Prospectus delivered to the Underwriters for use in connection with the offering
of the Notes will, at the time of such delivery, be identical to any electronically transmitted
copies thereof filed with the Commission pursuant to ▇▇▇▇▇, except to the extent permitted by
Regulation S-T.
b) Disclosure Package. The term “Disclosure Package” shall mean (i) the Preliminary
Prospectus dated November 9, 2010 (ii) the issuer free writing prospectuses as defined in Rule 433
of the Securities Act (each, an “Issuer Free Writing Prospectus”), if any, identified in
Annex I hereto and (iii) any other free writing prospectus that the parties hereto shall hereafter
expressly agree in writing to treat as part of the Disclosure Package. As of the Initial Sale
Time, the Disclosure Package did not contain any untrue statement of a material fact or omit to
state any material fact necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading. The preceding sentence does not apply to
statements in or omissions from the Disclosure Package based upon and in conformity with written
information furnished to the Company by any Underwriter through the Representatives specifically
for use therein, it being understood and agreed that the only such information furnished by any
Underwriter through the Representatives consists of the information described as such in Section 8
hereof.
3
c) Incorporated Documents. The documents incorporated or deemed to be incorporated by
reference in the Registration Statement, the Preliminary Prospectus and the Prospectus (i) at the
time they were or hereafter are filed with the Commission, complied or will comply in all material
respects with the requirements of the Exchange Act and (ii) when read together with the other
information in the Disclosure Package, at the Initial Sale Time, and when read together with the
other information in the Prospectus, at the date of the Prospectus and at the Closing Date, did not
or will not include an untrue statement of a material fact or omit to state a material fact
necessary in order to make the statements therein, in the light of the circumstances under which
they were made, not misleading.
d) Company is a Well-Known Seasoned Issuer. (i) At the time of filing the Registration
Statement, (ii) at the time of the most recent amendment thereto for the purposes of complying with
Section 10(a)(3) of the Securities Act (whether such amendment was by post-effective amendment,
incorporated report filed pursuant to Section 13 or 15(d) of the Exchange Act or form of
prospectus), (iii) at the time the Company or any person acting on its behalf (within the meaning,
for this clause only, of Rule 163(c) of the Securities Act) made any offer relating to the Notes in
reliance on the exemption of Rule 163 of the Securities Act, and (iv) as of the Execution Time, the
Company was and is a “well known seasoned issuer” as defined in Rule 405 of the Securities Act.
The Registration Statement is an “automatic shelf registration statement,” as defined in Rule 405
of the Securities Act, that automatically became effective not more than three years prior to the
Execution Time; the Company has not received from the Commission any notice pursuant to Rule
401(g)(2) of the Securities Act objecting to use of the automatic shelf registration statement form
and the Company has not otherwise ceased to be eligible to use the automatic shelf registration
form.
e) Company is not an Ineligible Issuer. (i) At the time of filing the Registration Statement
and (ii) as of the Execution Time (with such date being used as the determination date for purposes
of this clause (ii)), the Company was not and is not an “Ineligible Issuer” (as defined in Rule 405
of the Securities Act), without taking account of any determination by the Commission pursuant to
Rule 405 of the Securities Act that it is not necessary that the Company be considered an
Ineligible Issuer.
f) Issuer Free Writing Prospectuses. Each Issuer Free Writing Prospectus, as of its issue
date and at all subsequent times through the completion of the offering of Notes under this
Agreement or until any earlier date that the Company notified or notifies the Representatives as
described in the next sentence, did not, does not and will not include any information that
conflicted, conflicts or will conflict with the information contained in the Registration
Statement, the Preliminary Prospectus or the Prospectus. 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 conflicted or would conflict with the information
contained in the Registration Statement, the Preliminary Prospectus or the Prospectus, the Company
has promptly notified or will promptly notify the Representatives and has promptly amended or
supplemented or will promptly amend or supplement, at its own expense, such Issuer Free Writing
Prospectus to eliminate or correct such conflict. 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 through the Representatives
4
specifically for use therein, it being understood and agreed that the only such information
furnished by any Underwriter through the Representatives consists of the information described as
such in Section 8 hereof.
g) Distribution of Offering Material By the Company. The Company has not distributed and will
not distribute, prior to the later of the Closing Date and the completion of the Underwriters’
distribution of the Notes, any offering material in connection with the offering and sale of the
Notes other than the Registration Statement, the Preliminary Prospectus, the Prospectus, any Issuer
Free Writing Prospectus reviewed and consented to by the Representatives and included in Annex I
hereto or any electronic road show or other written communications reviewed and consented to by the
Representatives and listed on Annex II hereto (collectively, “Company Additional Written
Communication”). Each such Company Additional Written Communication, when taken together with
the Disclosure Package, did not, and at the Closing Date will not, contain any untrue statement of
a material fact or omit to state a material fact necessary in order to make the statements therein,
in the light of the circumstances under which they were made, not misleading. The preceding
sentence does not apply to statements in or omissions from the Company Additional Written
Communication based upon and in conformity with information furnished to the Company by any
Underwriter through the Representatives specifically for use therein, it being understood and
agreed that the only such information furnished by any Underwriter through the Representatives
consists of the information described as such in Section 8 hereof.
h) No Applicable Registration or Other Similar Rights. There are no persons with registration
or other similar rights that have the right to require the Company to register any equity or debt
securities under the Registration Statement by reason of the Offering contemplated by this
Agreement or otherwise have their securities included in the offering contemplated by this
Agreement, except for such rights as have been duly waived.
i) The Underwriting Agreement. This Agreement has been duly authorized, executed and
delivered by the Company.
j) Authorization of the Indenture. The Indenture has been duly qualified under the Trust
Indenture Act and has been duly authorized and, when executed and delivered by the Company
(assuming due authorization, execution and delivery of the Indenture by the Trustee), will
constitute a valid and binding agreement of the Company, enforceable against the Company in
accordance with its terms, except as the enforcement thereof may be limited by bankruptcy,
insolvency, fraudulent transfer, reorganization, moratorium or other similar laws relating to or
affecting the rights and remedies of creditors or by general equitable principles.
k) Authorization of the Notes. The Notes to be purchased by the Underwriters from the Company
are substantially in the form contemplated by the Indenture, have been duly authorized for issuance
and sale pursuant to this Agreement and the Indenture and, at the Closing Date, will have been duly
executed by the Company and, when authenticated in the manner provided for in the Indenture and
delivered against payment of the purchase price therefor, assuming due authorization, execution and
delivery of the Indenture by the Trustee, will constitute valid and binding obligations of the
Company, enforceable in accordance with their
5
terms, except as the enforcement thereof may be limited by bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium or other similar laws relating to or affecting the rights and
remedies of creditors or by general equitable principles, and will be entitled to the benefits of
the Indenture.
l) Description of the Notes and the Indenture. The Notes and the Indenture conform in all
material respects to the descriptions thereof contained in the Disclosure Package and the
Prospectus.
m) Accuracy of Statements in Prospectus. The statements in each of the Preliminary Prospectus
and the Prospectus under the captions “Description of Notes,” “Description of the Debt Securities”
and “Certain United States Federal Income Tax Considerations,” in each case insofar as such
statements constitute a summary of the legal matters, documents or proceedings referred to therein,
fairly present and summarize, in all material respects, the matters referred to therein.
n) No Material Adverse Change. Except as otherwise disclosed in the Disclosure Package,
subsequent to the respective dates as of which information is given in the Disclosure Package, (i)
neither the Company nor any of its subsidiaries has sustained any material 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 and (ii)
there has been no material adverse change, or any development that could reasonably be expected to
result in a material adverse change, in the general affairs, management, financial position,
shareholders’ equity or results of operations, whether or not arising from transactions in the
ordinary course of business, of the Company and its subsidiaries, considered as a whole (any such
change is called a “Material Adverse Change”).
o) Independent Accountants. Deloitte & Touche, who have expressed their opinion with respect
to the Company’s audited financial statements for the fiscal years ended December 31, 2009 and 2008
incorporated by reference in the Registration Statement, the Preliminary Prospectus and the
Prospectus, are, to the Company’s knowledge, independent public accountants with respect to the
Company as required by the Securities Act and the Exchange Act and are, to the Company’s knowledge,
an independent registered public accounting firm with the Public Company Accounting Oversight
Board.
p) Preparation of the Financial Statements. The consolidated historical financial statements
of the Company together with the related notes thereto incorporated by reference in the
Registration Statement, the Preliminary Prospectus and the Prospectus present fairly the
consolidated financial position of the Company and its consolidated subsidiaries as of and at the
dates indicated and the results of their operations and the changes in their cash flows for the
periods specified, in each case on a consolidated basis. Such financial statements comply in all
material respects as to form with the applicable accounting requirements of the Securities Act
and/or the Exchange Act and have been prepared 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 may be expressly stated in the related notes thereto.
No other financial statements are required to be included in the Registration Statement. The
6
selected financial data included in the Preliminary Prospectus and the Prospectus present
fairly in all material respects the information shown therein and have been compiled on a
consistent basis throughout the periods involved.
q) Incorporation and Good Standing of the Company and its Subsidiaries. Each of the Company
and its significant subsidiaries (as defined in Rule 1-02(w) of Regulation S-X, the
“Significant Subsidiaries”) listed in Annex III hereto has been duly incorporated 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 or lease, as the case may be, and
operate its properties and to conduct its business as described in the Disclosure Package and the
Prospectus and, in the case of the Company, to enter into and perform its obligations under this
Agreement and the Indenture, except where the failure to be in good standing would not,
individually or in the aggregate, result in a Material Adverse Change. Each of the Company and
each Significant Subsidiary 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, result in a Material Adverse Change. All of the issued and outstanding shares of
capital stock of each Significant Subsidiary have been duly authorized and validly issued, are
fully paid and nonassessable and are owned by the Company, directly or through subsidiaries, free
and clear of any security interest, mortgage, pledge, lien, encumbrance or claim, except for
security interests, mortgages, pledges, liens, encumbrances or claims the existence of which would
not have, individually or in the aggregate, a Material Adverse Change. The Company does not have
any subsidiary not listed on Exhibit 21 to the Annual Report on Form 10-K which is required to be
so listed, except for as listed in Schedule B attached hereto.
r) Capitalization and Other Share Capital Matters. The authorized, issued and outstanding
share capital of the Company is as set forth in the Disclosure Package and the Prospectus under the
caption “Capitalization” (other than (i) for subsequent issuances, if any, pursuant to employee
benefit plans described in the Disclosure Package and the Prospectus or upon exercise of
outstanding options described in the Disclosure Package and the Prospectus, as the case may be or
(ii) to reflect the repurchase of outstanding common shares pursuant to the Company’s share
repurchase program described in the Disclosure Package and the Prospectus).
s) Non-Contravention of Existing Instruments; No Further Authorizations or Approvals Required.
Neither the Company nor any of its Significant Subsidiaries is (i) in violation or in default (or,
with the giving of notice or lapse of time or both, would be in default) (“Default”) under
its articles of incorporation, charter, bye-laws or similar constitutional documents, (ii) in
Default under any indenture, mortgage, loan or credit agreement, deed of trust, note, contract,
franchise, lease or other agreement, obligation, condition, covenant or instrument required to be
filed as an exhibit to the Annual Report on Form 10-K to which the Company or any of its
subsidiaries is a party or to which any of the property or assets of the Company or any of its
subsidiaries is subject (each, an “Existing Instrument”) or (iii) in violation of any
statute, law, rule, regulation, judgment, order or decree of any court, regulatory body,
administrative agency, governmental body, arbitrator or other authority having jurisdiction over
the Company or any of its subsidiaries or any of its or their properties, as applicable, except,
with respect to
7
clauses (ii) and (iii) only, for such Defaults or violations as would not, individually or in
the aggregate result in a Material Adverse Change. The Company’s execution, delivery and
performance of this Agreement and consummation of the transactions contemplated hereby, by the
Disclosure Package and by the Prospectus (x) have been duly authorized by all necessary corporate
action and will not result in any Default under the memorandum of association, articles of
incorporation, charter, bye-laws or similar constitutional documents of the Company or any
subsidiary, (y) will not conflict with or constitute a breach of, or result in any Default or a
Debt Repayment Triggering 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 of its
subsidiaries pursuant to, or require the consent of any other party to, any Existing Instrument,
and (z) will not result in any violation of any statute, law, rule, regulation, judgment, order or
decree applicable to the Company or any of its subsidiaries of any court, regulatory body,
administrative agency, governmental body, arbitrator or other authority having jurisdiction over
the Company or any of its subsidiaries or any of its or their properties, except, in the cases of
clauses (y) and (z) above, for any such breach, violation or imposition as would not individually
or in the aggregate result in a Material Adverse Change or a material adverse effect upon the
consummation of the transactions contemplated hereby. No consent, approval, authorization or other
order of, or registration or filing with, any court or other governmental or regulatory authority
or agency is required for the Company’s execution, delivery and performance of this Agreement or
consummation of the transactions contemplated hereby, by the Disclosure Package or by the
Prospectus, except such as have been obtained or made by the Company and are in full force and
effect under the Securities Act and applicable state securities or blue sky laws and from the
Financial Industry Regulatory Authority, Inc. (“FINRA”), or except as disclosed in the
Disclosure Package and the Prospectus. As used herein, a “Debt Repayment Triggering Event”
means any event or condition which gives, or with the giving of notice or lapse of time or both
would give, the holder of any note, debenture or other evidence of indebtedness (or any person
acting on such holder’s behalf) issued by the Company, 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.
t) No Material Actions or Proceedings. Except as disclosed in the Prospectus and the
Disclosure Package, there are no legal or governmental actions, suits or proceedings pending or, to
the Company’s knowledge, threatened against or affecting the Company or any of its subsidiaries or
to which any officer or director of, or property owned or leased by, the Company or any of its
subsidiaries is subject which, if determined adversely, would, individually or in the aggregate,
result in a Material Adverse Change or adversely affect the consummation of the transactions
contemplated by this Agreement.
u) Intellectual Property Rights. Except as set forth in the Disclosure Package and the
Prospectus, to the Company’s knowledge, the Company or its subsidiaries own or possess a valid
right to use all patents, trademarks, service marks, trade names, copyrights, patentable
inventions, trade secrets, know-how and other intellectual property (collectively, the
“Intellectual Property”) used by the Company or its subsidiaries in, and material to, the
conduct of the Company’s or its subsidiaries’ business as now conducted or as proposed in the
Disclosure Package and the Prospectus to be conducted. Except as set forth in the Disclosure
Package and the Prospectus, there is no material infringement by third parties of any of the
Company’s
8
Intellectual Property and there are no legal or governmental actions, suits, proceedings or
claims pending or, to the Company’s knowledge, threatened, against the Company (i) challenging the
Company’s rights in or to any Intellectual Property, (ii) challenging the validity or scope of any
Intellectual Property owned by the Company, or (iii) alleging that the operation of the Company’s
business as now conducted infringes or otherwise violates any patent, trademark, copyright, trade
secret or other proprietary rights of a third party, and the Company is unaware of any facts which
would form a reasonable basis for any such claim.
v) Compliance with Insurance Laws. Each of the Company and its Significant Subsidiaries (i)
is in compliance with the applicable requirements of the insurance statutes, including the statutes
relating to companies which control insurance companies, and the rules, regulations and
interpretations of the insurance regulatory authorities thereunder (“Insurance Laws”) of
its jurisdiction of incorporation, and (ii) has filed all reports, information statements,
documents, and other information required to be filed thereunder, except in the case of the
foregoing clauses (i) and (ii) where the failure to comply would not, individually or in the
aggregate, result in a Material Adverse Change; each of the Company and its Significant
Subsidiaries (as applicable) maintains its books and records in accordance with and is in
compliance with the Insurance Laws of other jurisdictions which are applicable to any of them,
except where the failure to comply would not, individually or in the aggregate, result in a
Material Adverse Change. No insurance regulatory agency or body has issued any order or decree
impairing, restricting or prohibiting in any material respect the payment of any dividends by the
Company or any Significant Subsidiary or the continuation of the business of any of them as
currently conducted.
w) Insurance Registration and Licensing. Each of the Company and its Significant Subsidiaries
is duly registered as an insurer or reinsurer where it is required to be so registered to conduct
its business as described in the Disclosure Package and the Prospectus (except where the failure to
be so registered would not, individually or in the aggregate, result in a Material Adverse Change)
and is subject to regulation and supervision in its jurisdiction of incorporation. Each of the
Company and its Significant Subsidiaries is duly licensed or admitted as an insurer or an insurance
holding company, as applicable, in each jurisdiction where it is required to be so licensed or
admitted to conduct its business as described in the Disclosure Package and the Prospectus, except
for where the failure to be so licensed or admitted would not, individually or in the aggregate,
result in a Material Adverse Change.
x) All Necessary Permits, etc. The Company and each Significant Subsidiary possess such valid
and current certificates, authorizations, permits, licenses, approvals, consents and other
authorizations issued by the appropriate state, federal or foreign regulatory agencies or bodies
necessary to conduct their respective businesses, and neither the Company nor any Significant
Subsidiary has received any notice of proceedings relating to the revocation or modification of, or
non-compliance with, any such certificate, authorization, permit, license, approval, consent or
other authorization which, singly or in the aggregate, if the subject of an unfavorable decision,
ruling or finding, would reasonably be expected to result in a Material Adverse Change.
9
y) Title to Properties. The Company and its subsidiaries do not own any real property; the
Company and its subsidiaries have good and marketable title to all personal property owned by them
that is material to the business of the Company, in each case free and clear of all liens,
encumbrances and defects except such as are described in each of the Preliminary Prospectus and the
Prospectus and would not, individually or in the aggregate, reasonably be expected to result in a
Material Adverse Change; and any real property and buildings held under lease by the Company and
its subsidiaries are held by them under valid, subsisting and enforceable leases with such
exceptions as would not, individually or in the aggregate, reasonably be expected to result in a
Material Adverse Change.
z) Tax Law Compliance. The Company and its subsidiaries have filed all necessary federal,
state, local and foreign income and franchise tax returns in a timely manner and have paid all
taxes required to be paid by any of them and, if due and payable, any related or similar
assessment, fine or penalty levied against any of them, except for any taxes, assessments, fines or
penalties as may be being contested in good faith and by appropriate proceedings, except where a
default to make such filings or payments would not result in a Material Adverse Change. The
Company has made appropriate provisions in the applicable financial statements referred to in
Section 1(p) above in respect of all federal, state, local and foreign income and franchise taxes
for all current or prior periods as to which the tax liability of the Company or any of its
subsidiaries has not been finally determined.
aa) Stamp, Issuance and Other Taxes. No stamp or other issuance or transfer taxes or duties
and no capital gains, income, withholding or other taxes are payable by or on behalf of the
Underwriters to any Bermuda government authority or any political subdivision or taxing authority
thereof or therein in connection with (A) the sale and delivery by the Company of the Notes to or
for the respective accounts of the Underwriters or (B) the sale and delivery outside Bermuda by the
Underwriters of the Notes to the initial purchasers thereof; and no registration, documentary,
recording, transfer or other similar tax, fee or charge by any Bermuda government authority is
payable in connection with the execution, delivery, filing, registration or performance of this
Agreement.
bb) Tax Protection Act. Each of the Company, Allied World Assurance Company, Ltd.
(“AWAC”), Allied World Assurance Holdings (Ireland) Ltd (“Allied Ireland”) and
Newmarket Administrative Services (Bermuda), Ltd (“Newmarket”) has received from the
Bermuda Minister of Finance an assurance under The Exempted Undertakings Tax Protection Act, 1966
of Bermuda to the effect set forth in the Company’s annual report on Form 10-K for the year ended
December 31, 2009, incorporated by reference in the Preliminary Prospectus and the Prospectus, and
neither the Company, AWAC, Allied Ireland nor Newmarket have received any notification to the
effect (and is not otherwise aware) that such assurance may be revoked or otherwise not honored by
the Bermuda government before March 28, 2016. There is no Bermuda income, corporation or profits
tax, withholding tax, capital gains tax, estate duty or inheritance tax payable by the Company, any
of its subsidiaries or any Underwriter, except where such Underwriter is ordinarily resident in
Bermuda or resident in Bermuda for exchange control purposes.
10
cc) Exchange Controls. There are no currency exchange control laws or withholding taxes, in
each case of Bermuda (or any political subdivision or taxing authority thereof), that would be
applicable to the payment of interest on the Notes (other than as may apply to residents of Bermuda
for Bermuda exchange control purposes). The Company is an “exempted company” under Bermuda law and
has not (A) acquired and does not hold any land in Bermuda, other than that held by way of lease or
tenancy for terms of not more than 50 years, without the express authorization of the Bermuda
legislature, (B) taken mortgages on land in Bermuda to secure an amount in excess of $50,000,
without the consent of the Bermuda Minister of Finance, (C) acquired any bonds or debentures
secured by any land in Bermuda (other than certain types of Bermuda government securities), or (D)
conducted their business in a manner that is prohibited for “exempted companies” under Bermuda law.
The Company has not received notification from the Bermuda Monetary Authority or any other Bermuda
governmental authority of proceedings relating to the modification or revocation of its
designation as nonresident for exchange control purposes, its permission to issue and transfer the
Securities, or its status as an “exempted company”.
dd) Company Not an Investment Company. The Company has been advised of the rules and
requirements under the Investment Company Act of 1940, as amended (the “Investment Company
Act”). The Company is not, and after receipt of payment for the Notes and the application of
the proceeds thereof as contemplated under the caption “Use of Proceeds” in the Preliminary
Prospectus and the Prospectus will not be, required to register as an “investment company” within
the meaning of the Investment Company Act.
ee) No Price Stabilization or Manipulation. The Company has not taken and will not take,
directly or indirectly, any action designed to or that would be reasonably 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 Notes.
ff) Related Party Transactions. There are no business relationships or related-party
transactions involving the Company or any subsidiary or any other person required to be described
in the Preliminary Prospectus or the Prospectus that have not been described as required.
gg) No Unlawful Contributions or Other Payments. To the best of the Company’s knowledge and
believe, none of the Company, any of its subsidiaries or, to the knowledge of the Company, any
director, officer, agent, employee or affiliate of the Company or any of its subsidiaries has taken
any action, directly or indirectly, that would result in a violation by such persons of the FCPA,
and the Company, its subsidiaries and, to the knowledge of the Company, its affiliates have
conducted their businesses in compliance with the FCPA and have instituted and maintain general
policies and procedures that are designed to, among other things, provide reasonable assurance of
compliance by such entities and persons with the FCPA, and the Company believes such policies and
procedures are effective.
“FCPA” means the Foreign Corrupt Practices Act of 1977, as amended, and the rules and
regulations thereunder.
11
hh) Stock Options. With respect to the stock options (the “Stock Options”) granted
pursuant to the share-based compensation plans of the Company and its subsidiaries (the
“Company Stock Plans”), (i) each grant of a Stock Option was duly authorized no later than
the date on which the grant of such Stock Option was by its terms to be effective (the “Grant
Date”) by all necessary corporate action, including, as applicable, approval by the board of
directors of the Company (or a duly constituted and authorized committee thereof) and any required
shareholder approval by the necessary number of votes or written consents, and the award agreement
governing such grant (if any) was duly executed and delivered by each party thereto, (ii) each such
grant was made in accordance with the terms of the Company Stock Plans, the Exchange Act and all
other applicable laws and regulatory rules or requirements, including the rules of the New York
Stock Exchange and any other exchange on which Company securities are traded, (iii) the per share
exercise price of each Stock Option was equal to the fair market value of a common share on the
applicable Grant Date and (iv) each such grant was properly accounted for in accordance with GAAP
in the financial statements (including the related notes) of the Company and disclosed in the
Company’s filings with the Commission in accordance with the Exchange Act and all other applicable
laws. The Company has not knowingly granted, and there is no and has been no policy or practice of
the Company of granting, Stock Options prior to, or otherwise coordinate the grant of Stock Options
with, the release or other public announcement of material information regarding the Company or its
subsidiaries or their results of operations or prospects.
ii) No Conflict with Money Laundering Laws. To the Company’s knowledge, the operations of the
Company and its subsidiaries are and have been conducted at all times in compliance in all material
respects with the anti-money laundering statutes of all applicable 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”) in which such entities conduct business or to which such entities are otherwise subject,
and no action, suit or proceeding by or before any court or governmental agency, authority or body
or any arbitrator involving the Company or any of its subsidiaries with respect to the Money
Laundering Laws is pending or, to the best knowledge of the Company, anticipated.
jj) No Conflict with OFAC Laws. Neither the Company nor any of its subsidiaries nor, to the
knowledge of the Company, any director, officer, agent, employee or affiliate of the Company or any
of its subsidiaries 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.
kk) ERISA Compliance. The Company and its subsidiaries and any “employee benefit plan” (as
defined in Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended, and the
regulations and published interpretations thereunder (collectively, “ERISA”)) established
or maintained by the Company, its subsidiaries or their ERISA Affiliates (as defined below) are in
compliance in all material respects with ERISA. “ERISA Affiliate”
12
means, with respect to the Company or a subsidiary, any member of any group of organizations
described in Sections 414(b), (c), (m) or (o) of the Internal Revenue Code of 1986, as amended (the
“Internal Revenue Code”), of which the Company or such subsidiary is a member. No
“reportable event” (as defined under ERISA) has occurred or is reasonably expected to occur with
respect to any “employee benefit plan” established or maintained by the Company, its subsidiaries
or any of their ERISA Affiliates. No “employee benefit plan” established or maintained by the
Company, its subsidiaries or any of their ERISA Affiliates, if such “employee benefit plan” were
terminated, would have any “amount of unfunded benefit liabilities” (as defined under ERISA).
Neither the Company, its subsidiaries nor any of their ERISA Affiliates has incurred or reasonably
expects to incur any liability under (i) Title IV of ERISA with respect to termination of, or
withdrawal from, any “employee benefit plan,” (ii) Sections 412, 4971 or 4975 of the Internal
Revenue Code, or (iii) Section 4980B of the Internal Revenue Code with respect to the excise tax
imposed thereunder. Each “employee benefit plan” established or maintained by the Company, its
subsidiaries or any of their ERISA Affiliates that is intended to be qualified under Section 401(a)
of the Internal Revenue Code has received a favorable determination letter from the Internal
Revenue Service and nothing has occurred, whether by action or failure to act, which is reasonably
likely to cause disqualification of any such employee benefit plan under Section 401(a) of the
Internal Revenue Code.
ll) ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Compliance. There is and has been no material failure on the part of the
Company and any of the Company’s directors or officers, in their capacities as such, to comply with
any provision of the ▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act of 2002 and the rules and regulations promulgated in
connection therewith (the “▇▇▇▇▇▇▇▇-▇▇▇▇▇ Act”), including Section 402 related to loans and
Sections 302 and 906 related to certifications.
mm) Company’s Accounting System. The Company’s internal control over financial reporting (as
such term is defined in Rule 13a-15(f) under the Exchange Act) was deemed to be effective at
December 31, 2009, and other than as previously disclosed since such date, there have been no
changes in internal control over financial reporting that have materially affected or are
reasonably likely to materially affect the Company’s internal control over financial reporting.
nn) Internal Controls and Procedures. The Company maintains a system of internal control over
financial reporting (as such term is defined in Rule 13a-15(f) under the Exchange Act) sufficient
to provide reasonable assurance that (A) transactions are executed in accordance with management’s
general or specific authorizations; (B) transactions are recorded as necessary to permit
preparation of financial statements in conformity with generally accepted accounting principles and
to maintain asset accountability; (C) access to assets is permitted only in accordance with
management’s general or specific authorization; and (D) the recorded accountability for assets is
compared with the existing assets at reasonable intervals and appropriate action is taken with
respect to any differences.
oo) No Material Weakness in Internal Controls. Except as disclosed in the Disclosure Package
and the Prospectus or in any document incorporated by reference therein, 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
13
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.
pp) Accuracy of Exhibits. There are no franchises, contracts or documents which are required
to be described in the Registration Statement, the Disclosure Package, the Prospectus or the
documents incorporated by reference therein or to be filed as exhibits to the Registration
Statement which have not been so described and filed as required.
Any certificate signed by an officer of the Company and delivered to the Representatives 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.
Section 2. Purchase, Sale and Delivery of the Notes.
a) The Notes. The Company agrees to issue and sell to the several Underwriters, severally and
not jointly, all of the Notes upon the terms herein set forth. On the basis of the
representations, warranties and agreements herein contained, and upon the terms but subject to the
conditions herein set forth, the Underwriters agree, severally and not jointly, to purchase from
the Company the aggregate principal amount of Notes set forth opposite their names on Schedule A at
a purchase price of 98.894% of the principal amount of the Notes, payable on the Closing Date.
b) The Closing Date. Delivery of certificates for the Notes in global form to be purchased by
the Underwriters and payment therefor shall be made at the offices of Shearman & Sterling LLP, ▇▇▇
▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇▇▇ ▇▇▇▇, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ (or such other place as may be agreed to by the Company
and the Representatives) at 9:30 a.m., New York City time, on November 15, 2010, or such other time
and date as the Underwriters and the Company shall mutually agree (the time and date of such
closing are called the “Closing Date”).
c) Public Offering of the Notes. The Representatives hereby advise the Company that the
Underwriters intend to offer for sale to the public, as described in the Disclosure Package and the
Prospectus, their respective portions of the Notes as soon after the Execution Time as the
Representatives, in their sole judgment, have determined is advisable and practicable.
d) Payment for the Notes. Payment for the Notes shall be made at the Closing Date by wire
transfer of immediately available funds to the order of the Company.
It is understood that the Representatives have been authorized, for their own accounts and for
the accounts of the several Underwriters, to accept delivery of and receipt for, and make payment
of the purchase price for, the Notes that the Underwriters have agreed to purchase. The
Representatives may (but shall not be obligated to) make payment for any Notes to be purchased by
any Underwriter whose funds shall not have been received by the Representatives by the Closing Date
for the account of such Underwriter, but any such payment shall not relieve such Underwriter from
any of its obligations under this Agreement.
e) Delivery of the Notes. The Company shall deliver, or cause to be delivered, to the
Representatives for the accounts of the several Underwriters certificates for the Notes at the
14
Closing Date, against the irrevocable release of a wire transfer of immediately available
funds for the amount of the purchase price therefor. The certificates for the Notes shall be in
such denominations and registered in such names and denominations as the Representatives shall have
requested at least two full business days prior to the Closing Date and shall be made available for
inspection on the business day preceding the Closing Date at a location in New York City, as the
Representatives may designate. Time shall be of the essence, and delivery at the time and place
specified in this Agreement is a further condition to the obligations of the Underwriters.
Section 3. Covenants of the Company.
The Company covenants and agrees with each Underwriter as follows:
a) Compliance with Securities Regulations and Commission Requests. The Company, subject to
Section 3(b), will comply with the requirements of Rule 430B of the Securities Act, and will
promptly notify the Representatives, and confirm the notice in writing, of (i) the effectiveness
during the Prospectus Delivery Period (as defined below) of any post-effective amendment to the
Registration Statement or the filing of any supplement or amendment to the Preliminary Prospectus
or the Prospectus, (ii) the receipt of any comments from the Commission during the Prospectus
Delivery Period, (iii) any request by the Commission for any amendment to the Registration
Statement or any amendment or supplement to the Preliminary Prospectus or the Prospectus or for
additional information, and (iv) the issuance by the Commission of any stop order suspending the
effectiveness of the Registration Statement or of any order preventing or suspending the use of the
Preliminary Prospectus or the Prospectus, or of the suspension of the qualification of the Notes
for offering or sale in any jurisdiction, or of the initiation or threatening of any proceedings
for any of such purposes. The Company will promptly effect the filings necessary pursuant to Rule
424 and will take such steps as it deems necessary to ascertain promptly whether the Preliminary
Prospectus and the Prospectus transmitted for filing under Rule 424 was received for filing by the
Commission and, in the event that it was not, it will promptly file such document. The Company
will use its reasonable best efforts to prevent the issuance of any stop order and, if any stop
order is issued, to obtain the lifting thereof as soon as practicable thereafter.
b) Filing of Amendments. During such period beginning on the date of this Agreement and
ending on the later of the Closing Date or such date as, in the opinion of counsel for the
Underwriters, the Prospectus is no longer required by law to be delivered in connection with sales
of the Notes by an Underwriter or dealer, including in circumstances where such requirement may be
satisfied pursuant to Rule 172 of the Securities Act (the “Prospectus Delivery Period”),
the Company will give the Representatives notice of its intention to file or prepare any amendment
to the Registration Statement (including any filing under Rule 462(b) of the Securities Act), or
any amendment, supplement or revision to the Disclosure Package or the Prospectus, whether pursuant
to the Securities Act, the Exchange Act or otherwise, will furnish the Representatives with copies
of any such documents a reasonable amount of time prior to such proposed filing or use, as the case
may be, and will not file or use any such document to which the Representatives or counsel for the
Underwriters shall reasonably object.
15
c) Delivery of Registration Statements. The Company has furnished or will deliver to the
Representatives and counsel for the Underwriters, without charge, signed copies of the Registration
Statement as originally filed 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) and signed copies of all consents and certificates of experts, and will also
deliver to the Representatives, without charge, a conformed copy of the Registration Statement as
originally filed and of each amendment thereto (without exhibits) for each of the Underwriters.
The Registration Statement and each amendment thereto furnished to the Underwriters will be
identical to any electronically transmitted copies thereof filed with the Commission pursuant to
▇▇▇▇▇, except to the extent permitted by Regulation S-T.
d) Delivery of Prospectuses. The Company will deliver to each Underwriter, without charge, as
many copies of the Preliminary Prospectus as such Underwriter may reasonably request, and the
Company hereby consents to the use of such copies for purposes permitted by the Securities Act.
The Company will furnish to each Underwriter, without charge, during the Prospectus Delivery
Period, such number of copies of the Prospectus as such Underwriter may reasonably request. The
Preliminary Prospectus and the Prospectus and any amendments or supplements thereto furnished to
the Underwriters will be identical to any electronically transmitted copies thereof filed with the
Commission pursuant to ▇▇▇▇▇, except to the extent permitted by Regulation S-T.
e) Continued Compliance with Securities Laws. The Company will comply with the Securities Act
and the Exchange Act so as to permit the completion of the distribution of the Notes as
contemplated in this Agreement and in the Registration Statement, the Disclosure Package and the
Prospectus. If at any time during the Prospectus Delivery Period, any event shall occur or
condition shall exist as a result of which it is necessary, in the opinion of counsel for the
Underwriters or for the Company, to amend the Registration Statement in order that the Registration
Statement 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 or to
amend or supplement the Disclosure Package or the Prospectus in order that the Disclosure Package
or the Prospectus, as the case may be, will not include an untrue statement of a material fact or
omit to state a material fact necessary in order to make the statements therein, in the light of
the circumstances existing at the Initial Sale Time or at the time it is delivered or conveyed to a
purchaser, not misleading, or if it shall be necessary, in the opinion of either such counsel, at
any such time to amend the Registration Statement or amend or supplement the Disclosure Package or
the Prospectus in order to comply with the requirements of any law, the Company will (1) notify the
Representatives of any such event, development or condition and (2) promptly prepare and file with
the Commission, subject to Section 3(b) hereof, such amendment or supplement as may be necessary to
correct such statement or omission or to make the Registration Statement, the Disclosure Package or
the Prospectus comply with such law, and the Company will furnish to the Underwriters, without
charge, such number of copies of such amendment or supplement as the Underwriters may reasonably
request.
f) Blue Sky Compliance. The Company shall cooperate with the Representatives and counsel for
the Underwriters to qualify or register the Notes for sale under (or obtain exemptions from the
application of) the state securities or blue sky laws of those jurisdictions
16
designated by the Representatives, shall comply with such laws and shall continue such
qualifications, registrations and exemptions in effect so long as required for the distribution of
the Notes. The Company shall not be required to qualify to transact business or to take any action
that would subject it to general service of process in any such jurisdiction where it is not
presently qualified or where it would be subject to taxation as a foreign business. The Company
will advise the Representatives promptly of the suspension of the qualification or registration of
(or any such exemption relating to) the Notes for offering, sale or trading in any jurisdiction or
any initiation or threat of any proceeding for any such purpose, and in the event of the issuance
of any order suspending such qualification, registration or exemption, the Company shall use its
reasonable best efforts to obtain the withdrawal thereof as soon as practicable thereafter.
g) Use of Proceeds. The Company shall apply the net proceeds from the sale of the Notes sold
by it in the manner described under the caption “Use of Proceeds” in the Preliminary Prospectus and
the Prospectus.
h) Depositary. The Company will cooperate with the Underwriters and use its reasonable best
efforts to permit the Notes to be eligible for clearance and settlement through the facilities of
the Depositary.
i) Periodic Reporting Obligations. During the Prospectus Delivery Period, the Company shall
file, on a timely basis, with the Commission and the New York Stock Exchange all reports and
documents required to be filed under the Exchange Act.
j) Agreement Not to Offer or Sell Additional Securities. During the period commencing on the
date hereof and ending on the Closing Date, the Company will not, without the prior written consent
of the Representatives (which consent may be withheld at the sole discretion of the
Representatives), directly or indirectly, sell, offer, contract or grant any option to sell,
pledge, transfer or establish an open “put equivalent position” within the meaning of Rule 16a-1(h)
under the Exchange Act, or otherwise dispose of or transfer, or announce the offering of, or file
any registration statement under the Securities Act in respect of, any debt securities of the
Company similar to the Notes or securities exchangeable for or convertible into debt securities
similar to the Notes (other than as contemplated by this Agreement with respect to the Notes).
k) Final Term Sheet. The Company will prepare a final term sheet containing only a
description of the Notes, in a form approved by the Underwriters and attached as Exhibit C hereto,
and will file such term sheet pursuant to Rule 433(d) under the Securities Act within the time
required by such rule (such term sheet, the “Final Term Sheet”). Any such Final Term Sheet
is an Issuer Free Writing Prospectus for purposes of this Agreement.
l) Permitted Free Writing Prospectuses. The Company represents that it has not made, and
agrees that, unless it obtains the prior consent of the Representatives, it will not make, any
offer relating to the Notes that would constitute an Issuer Free Writing Prospectus or that would
otherwise constitute a “free writing prospectus” (as defined in Rule 405 of the Securities Act)
required to be filed by the Company with the Commission or retained by the Company under Rule 433
of the Securities Act; provided that the prior consent of the Representatives shall
17
be deemed to have been given in respect of any Issuer Free Writing Prospectuses included in
Annex I to this Agreement. Any such free writing prospectus consented to or deemed to be consented
to by the Representatives is hereinafter referred to as a “Permitted Free Writing
Prospectus.” The Company agrees that (i) it has treated and will treat, as the case may be,
each Permitted Free Writing Prospectus as an Issuer Free Writing Prospectus, and (ii) has complied
and will comply, as the case may be, with the requirements of Rules 164 and 433 of the Securities
Act applicable to any Permitted Free Writing Prospectus, including in respect of timely filing with
the Commission, legending and record keeping. The Company consents to the use by any Underwriter
of a free writing prospectus that (a) is not an “issuer free writing prospectus” as defined in Rule
433, and (b) contains only (i) information describing the preliminary terms of the Notes or their
offering, (ii) information permitted by Rule 134 under the Securities Act or (iii) information that
describes the final terms of the Notes or their offering and that is included in the Final Term
Sheet of the Company contemplated in Section 3(k).
m) Registration Statement Renewal Deadline. If immediately prior to the third anniversary
(the “Renewal Deadline”) of the initial effective date of the Registration Statement, any
of the Notes remain unsold by the Underwriters, the Company will prior to the Renewal Deadline
file, if it has not already done so and is eligible to do so, a new automatic shelf registration
statement relating to the Notes, in a form satisfactory to the Representatives. If the Company is
no longer eligible to file an automatic shelf registration statement, the Company will prior to the
Renewal Deadline, if it has not already done so, file a new shelf registration statement relating
to the Notes, in a form satisfactory to the Representatives, and will use its commercially
reasonable efforts to cause such registration statement to be declared effective within 90 days
after the Renewal Deadline. The Company will take all other action necessary or appropriate to
permit the public offering and sale of the Notes to continue as contemplated in the expired
registration statement relating to the Notes. References herein to the Registration Statement
shall include such new automatic shelf registration statement or such new shelf registration
statement, as the case may be.
n) Notice of Inability to Use Automatic Shelf Registration Statement Form. If at any time
during the Prospectus Delivery Period, the Company receives from the Commission a notice pursuant
to Rule 401(g)(2) or otherwise ceases to be eligible to use the automatic shelf registration
statement form, the Company will (i) promptly notify the Representatives, (ii) promptly file a new
registration statement or post-effective amendment on the proper form relating to the Notes, in a
form satisfactory to the Representatives, (iii) use its commercially reasonable efforts to cause
such registration statement of post-effective amendment to be declared effective and (iv) promptly
notify the Representatives of such effectiveness. The Company will take all other action
reasonably necessary or appropriate to permit the public offering and sale of the Notes to continue
as contemplated in the registration statement that was the subject of the Rule 401(g)(2) notice or
for which the Company has otherwise become ineligible. References herein to the Registration
Statement shall include such new registration statement or post-effective amendment, as the case
may be.
o) Filing Fees. The Company agrees to pay the required Commission filing fees relating to the
Notes within the time required by and in accordance with Rule 456(b)(1) and 457(r) of the
Securities Act.
18
p) No Manipulation of Price. The Company will not knowingly take, directly or indirectly, any
action designed to cause or result in, or that has constituted or might reasonably be expected to
constitute, under the Exchange Act or otherwise, the stabilization or manipulation of the price of
any securities of the Company to facilitate the sale or resale of the Notes.
The Representatives, on behalf of the several Underwriters, may, in their sole discretion,
waive in writing the performance by the Company of any one or more of the foregoing covenants or
extend the time for their performance.
Section 4. Payment of Expenses. The Company agrees to pay all costs, fees and
expenses incurred in connection with the performance of its obligations hereunder and in connection
with the transactions contemplated hereby, including without limitation (i) all expenses incident
to the issuance and delivery of the Notes (including all printing and engraving costs), (ii) all
necessary issue, transfer and other stamp taxes in connection with the issuance and sale of the
Notes, (iii) all fees and expenses of the Company’s counsel, independent public or certified public
accountants and other advisors to the Company, (iv) all costs and expenses incurred in connection
with the preparation, printing, filing, shipping and distribution of the Registration Statement
(including financial statements, exhibits, schedules, consents and certificates of experts), each
Issuer Free Writing Prospectus, the Preliminary Prospectus and the Prospectus, and all amendments
and supplements thereto, and the DTC Agreement, (v) all filing fees, reasonable attorneys’ fees (of
one counsel in the case of the Underwriters) and expenses incurred by the Company or the
Underwriters in connection with qualifying or registering (or obtaining exemptions from the
qualification or registration of) all or any part of the Notes for offer and sale under the state
securities or blue sky laws, and, if requested by the Representatives, preparing a “Blue Sky
Survey” or memorandum, and any supplements thereto, advising the Underwriters of such
qualifications, registrations and exemptions, (vi) the filing fees incident to, and the reasonable
fees and disbursements of one counsel to the Underwriters in connection with, the review, if any,
by FINRA of the terms of the sale of the Notes, (vii) the fees and expenses of the Trustee,
including the reasonable fees and disbursements of counsel for the Trustee in connection with the
Indenture and the Notes, (viii) any fees payable in connection with the rating of the Notes with
the ratings agencies, (ix) all fees and expenses (including reasonable fees and expenses of
counsel) of the Company in connection with approval of the Notes by the Depositary for “book-entry”
transfer, (x) all other fees, costs and expenses referred to in Item 14 of Part II of the
Registration Statement, and (xi) all other fees, costs and expenses incurred in connection with the
performance of its obligations hereunder for which provision is not otherwise made in this Section.
Except as provided in this Section 4 and Sections 6, 8 and 9 hereof, the Underwriters shall pay
their own expenses, including the fees and disbursements of their counsel.
Section 5. Conditions of the Obligations of the Underwriters. The obligations of
the several Underwriters to purchase and pay for the Notes as provided herein on the Closing Date
shall be subject to the accuracy of the representations and warranties on the part of the Company
set forth in Section 1 hereof as of the date hereof, as of the Initial Sale Time, and as of the
Closing Date as though then made and to the timely performance by the Company of its covenants and
other obligations hereunder, and to each of the following additional conditions:
19
a) Effectiveness of Registration Statement. The Registration Statement shall have become
effective under the Securities Act and no stop order suspending the effectiveness of the
Registration Statement shall have been issued under the Securities Act and no proceedings for that
purpose shall have been instituted or be pending or to the knowledge of the Company threatened by
the Commission, any request on the part of the Commission for additional information shall have
been complied with to the reasonable satisfaction of counsel to the Underwriters and the Company
shall not have received from the Commission any notice pursuant to Rule 401(g)(2) of the Securities
Act objecting to use of the automatic shelf registration statement form. The Preliminary
Prospectus and the Prospectus shall have been filed with the Commission in accordance with Rule
424(b) (or any required post-effective amendment providing such information shall have been filed
and declared effective in accordance with the requirements of Rule 430A).
b) Accountants’ Comfort Letter. On the date hereof, the Representatives shall have received
from Deloitte & Touche, independent registered public accountants for the Company, a letter dated
the date hereof addressed to the Underwriters, in form and substance satisfactory to the
Representatives with respect to the audited and unaudited financial statements and certain
financial information contained or incorporated by reference in the Registration Statement, the
Preliminary Prospectus and the Prospectus.
c) Bring-down Comfort Letter. On the Closing Date, the Representatives shall have received
from Deloitte & Touche, independent registered public accountants for the Company, a letter dated
such date, in form and substance satisfactory to the Representatives, to the effect that they
reaffirm the statements made in the letter furnished by them pursuant to subsection (b) of this
Section 5, except that the specified date referred to therein for the carrying out of procedures
shall be no more than three business days prior to the Closing Date.
d) No Material Adverse Change or Ratings Agency Change. For the period from and after the
date of this Agreement and prior to the Closing Date:
(i) in the judgment of the Representatives there shall not have occurred any Material
Adverse Change;
(ii) there shall not have been any change or decrease specified in the letter or
letters referred to in paragraph (c) of this Section 5 which is, in the sole judgment of the
Representatives, so material and adverse as to make it impractical or inadvisable to proceed
with the offering or delivery of the Notes as contemplated by the Prospectus; and
(iii) there shall not have occurred any downgrading, nor shall any notice have been
given of any intended or potential downgrading or of any review for a possible change that
does not indicate the direction of the possible change, in the rating accorded any debt
securities of the Company or any of its subsidiaries by any “nationally recognized
statistical rating organization” as such term is defined for purposes of Rule 436(g)(2)
under the Securities Act.
20
e) Opinion of Counsel for the Company. On the Closing Date, the Representatives shall have
received (i) an opinion of ▇▇▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇▇ LLP, United States counsel for the Company,
dated as of such Closing Date, the form of which is attached as Exhibit A and (ii) an opinion of
▇▇▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇ Limited, Bermuda counsel for the Company, dated as of such Closing Date, the
form of which is attached as Exhibit B.
f) Opinion of Counsel for the Underwriters. On the Closing Date, the Representatives shall
have received an opinion of Shearman & Sterling LLP, counsel for the Underwriters, dated as of such
Closing Date, with respect to such matters as may be reasonably requested by the Underwriters.
g) Officers’ Certificate. On the Closing Date, the Representatives shall have received a
written certificate executed by the Chairman of the Board or the Chief Executive Officer or a
Senior Vice President of the Company and the Chief Financial Officer or Chief Accounting Officer of
the Company, dated as of such Closing Date, to the effect that:
(i) the Company has received no stop order suspending the effectiveness of the
Registration Statement, and no proceedings for such purpose have been instituted or, to the
knowledge of the Company, threatened by the Commission;
(ii) the Company has not received from the Commission any notice pursuant to Rule
401(g)(2) of the Securities Act objecting to use of the automatic shelf registration
statement form;
(iii) the representations, warranties and covenants of the Company set forth in
Section 1 of this Agreement are true and correct with the same force and effect as though
expressly made on and as of such Closing Date; and
(iv) the Company has complied with all the agreements hereunder and satisfied all the
conditions on its part to be performed or satisfied hereunder at or prior to such Closing
Date.
h) Additional Documents. On or before the Closing Date, the Representatives and counsel for
the Underwriters shall have received such information, documents and opinions as they may
reasonably require for the purposes of enabling them to pass upon the issuance and sale of the
Notes as contemplated herein, or in order to evidence the accuracy of any of the representations
and warranties, or the satisfaction of any of the conditions or agreements, herein contained.
If any condition specified in this Section 5 is not satisfied when and as required to be
satisfied, this Agreement may be terminated by the Representatives by notice to the Company at any
time on or prior to the Closing Date, which termination shall be without liability on the part of
any party to any other party, except that Sections 4, 6, 8, 9 and 17 shall at all times be
effective and shall survive such termination.
Section 6. Reimbursement of Underwriters’ Expenses. If this Agreement is terminated
by the Representatives other than as a result of termination pursuant to ▇▇▇▇▇▇▇ ▇▇ ▇▇ ▇▇▇▇▇▇▇
(▇▇),
▇▇
(▇▇▇), (▇▇) or (vi) of Section 11, or if the sale to the Underwriters of the Notes on the
Closing Date is not consummated because of any refusal, inability or failure on the part of the
Company to perform any agreement herein or to comply with any provision hereof, the Company agrees
to reimburse the Representatives and the other Underwriters (or such Underwriters as have
terminated this Agreement with respect to themselves), severally, upon demand for all out-of-pocket
expenses that shall have been reasonably incurred by the Representatives and the Underwriters in
connection with the proposed purchase and the offering and sale of the Notes, including but not
limited to fees and disbursements of one counsel, printing expenses, travel expenses, postage,
facsimile and telephone charges.
Section 7. Effectiveness of this Agreement. This Agreement shall not become
effective until the execution of this Agreement by the parties hereto.
Section 8. Indemnification.
(a) Indemnification of the Underwriters. The Company agrees to indemnify and hold harmless
each Underwriter, its directors, officers, employees and agents, and each person, if any, who
controls any Underwriter within the meaning of the Securities Act and the Exchange Act against any
loss, claim, damage, liability or expense, as incurred, to which such Underwriter or such director,
officer, employee, agent or controlling person may become subject, under the Securities Act, the
Exchange Act or other federal or state statutory law or regulation, or at common law or otherwise
(including in settlement of any litigation, if such settlement is effected with the written consent
of the Company), insofar as such loss, claim, damage, liability or expense (or actions in respect
thereof as contemplated below) arises out of or is based (i) upon any untrue statement or alleged
untrue statement of a material fact contained in the Registration Statement, or any amendment
thereto, or the omission or alleged omission therefrom of a material fact required to be stated
therein or necessary to make the statements therein not misleading; or (ii) upon any untrue
statement or alleged untrue statement of a material fact contained in any Company Additional
Written Communication, any Issuer Free Writing Prospectus, the Preliminary Prospectus or the
Prospectus (or any amendment or supplement thereto) or the omission or alleged omission therefrom
of a material fact necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading; and to reimburse each Underwriter and
each such director, officer, employee, agent and controlling person for any and all expenses
(including the reasonable fees and disbursements of counsel chosen by MLPF&S and ▇▇▇▇▇ Fargo) as
such expenses are reasonably incurred by such Underwriter or such director, officer, employee,
agent or controlling person in connection with investigating, defending, settling, compromising or
paying any such loss, claim, damage, liability, expense or action; provided, however, that the
foregoing indemnity agreement shall not apply to any loss, claim, damage, liability or expense to
the extent, but only to the extent, arising out of or based upon any untrue statement or alleged
untrue statement or omission or alleged omission made in reliance upon and in conformity with
written information furnished to the Company by any Underwriter through the Representatives
expressly for use in the Registration Statement, any Company Additional Written Communication, any
Issuer Free Writing Prospectus, the Preliminary Prospectus or the Prospectus (or any amendment or
supplement thereto). The indemnity agreement set forth in this Section 8(a) shall be in addition to
any liabilities that the Company may otherwise have.
22
(b) Indemnification of the Company, its Directors and Officers. Each Underwriter agrees,
severally and not jointly, to indemnify and hold harmless the Company, each of its directors, each
of its officers who signed the Registration Statement and each person, if any, who controls the
Company within the meaning of the Securities Act or the Exchange Act, against any loss, claim,
damage, liability or expense, as incurred, to which the Company or any such director, officer or
controlling person may become subject, under the Securities Act, the Exchange Act, or other federal
or state statutory law or regulation, or at common law or otherwise (including in settlement of any
litigation, if such settlement is effected with the written consent of such Underwriter), insofar
as such loss, claim, damage, liability or expense (or actions in respect thereof as contemplated
below) arises out of or is based (i) upon any untrue statement or alleged untrue statement of a
material fact contained in the Registration Statement, or any amendment thereto, or the omission or
alleged omission therefrom of a material fact required to be stated therein or necessary to make
the statements therein not misleading; or (ii) upon any untrue statement or alleged untrue
statement of a material fact contained in any Company Additional Written Communication, any Issuer
Free Writing Prospectus, the Preliminary Prospectus or the Prospectus (or any amendment or
supplement thereto) or the omission or alleged omission therefrom of 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 to the extent, but only to the extent, that such untrue statement or
alleged untrue statement or omission or alleged omission was made in the Registration Statement,
any Company Additional Written Communication, any Issuer Free Writing Prospectus, the Preliminary
Prospectus or the Prospectus (or any amendment or supplement thereto), in reliance upon and in
conformity with written information furnished to the Company by any Underwriter through the
Representatives expressly for use therein; and to reimburse the Company, or any such director,
officer or controlling person for any legal and other expense reasonably incurred by the Company,
or any such director, officer or controlling person in connection with investigating, defending,
settling, compromising or paying any such loss, claim, damage, liability, expense or action. The
Company hereby acknowledges that the only information furnished to the Company by any Underwriter
through the Representatives expressly for use in the Registration Statement, any Company Additional
Written Communication, any Issuer Free Writing Prospectus, the Preliminary Prospectus or the
Prospectus (or any amendment or supplement thereto) are the statements set forth in the fifth
paragraph of the text on the cover page, the first paragraph of the text under the caption
“Underwriting — Commissions and Discounts” on page S-20 and the first paragraph of the text under
the caption “Underwriting — Short Positions” on page S-21 in the Preliminary Prospectus and the
Prospectus. The indemnity agreement set forth in this Section 8(b) shall be in addition to any
liabilities that each Underwriter may otherwise have.
(c) Notifications and Other Indemnification Procedures. Promptly after receipt by an
indemnified party under this Section 8 of notice of the commencement of any action, such
indemnified party will, if a claim in respect thereof is to be made against an indemnifying party
under this Section 8, notify the indemnifying party in writing of the commencement thereof, but the
omission so to notify the indemnifying party will not relieve it from any liability which it may
have to any indemnified party for contribution or otherwise than under the indemnity agreement
contained in this Section 8 or to the extent it is not prejudiced as a proximate result of such
failure. In case any such action is brought against any indemnified party and such
23
indemnified party seeks or intends to seek indemnity from an indemnifying party, the
indemnifying party will be entitled to participate in, and, to the extent that it shall elect,
jointly with all other indemnifying parties similarly notified, by written notice delivered to the
indemnified party, to assume the defense thereof with counsel reasonably satisfactory to such
indemnified party; provided, however, such indemnified party shall have the right to employ its own
counsel in any such action and to participate in the defense thereof, but the fees and expenses of
such counsel shall be at the expense of such indemnified party, unless: (i) the employment of such
counsel has been specifically authorized in writing by the indemnifying party; (ii) the
indemnifying party has failed promptly to assume the defense and employ counsel reasonably
satisfactory to the indemnified party; or (iii) the named parties to any such action (including any
impleaded parties) include both such indemnified party and the indemnifying party or any affiliate
of the indemnifying party, and such indemnified party shall have reasonably concluded that either
(x) there may be one or more legal defenses available to it which are different from or additional
to those available to the indemnifying party or such affiliate of the indemnifying party or (y) a
conflict may exist between such indemnified party and the indemnifying party or such affiliate of
the indemnifying party (it being understood, however, that the indemnifying party shall not, in
connection with any one such action or separate but substantially similar or related actions in the
same jurisdiction arising out of the same general allegations or circumstances, be liable for the
fees and expenses of more than one separate firm of attorneys (in addition to a single firm of
local counsel) for all such indemnified parties, which firm shall be designated in writing by
MLPF&S and ▇▇▇▇▇ Fargo and that all such reasonable fees and expenses shall be reimbursed as they
are incurred). Upon receipt of notice from the indemnifying party to such indemnified party of
such indemnifying party’s election so to assume the defense of such action and approval by the
indemnified party of counsel, the indemnifying party will not be liable to such indemnified party
under this Section 8 for any legal or other expenses subsequently incurred by such indemnified
party in connection with the defense thereof unless the indemnified party shall have employed
separate counsel in accordance with the proviso to the next preceding sentence, in which case the
reasonable fees and expenses of counsel shall be at the expense of the indemnifying party.
(d) Settlements. The indemnifying party under this Section 8 shall not be liable for any
settlement of any proceeding effected without its written consent, but if settled with such consent
or if there be a final judgment for the plaintiff, the indemnifying party agrees to indemnify the
indemnified party against any loss, claim, damage, liability or expense by reason of such
settlement or judgment. No indemnifying party shall, without the prior written consent of the
indemnified party, effect any settlement, compromise or consent to the entry of judgment in any
pending or threatened action, suit or proceeding in respect of which any indemnified party is or
could have been a party and indemnity was or could have been sought hereunder by such indemnified
party, unless such settlement, compromise or consent (i) includes an unconditional release of such
indemnified party from all liability on claims that are the subject matter of such action, suit or
proceeding and (ii) does not include a statement as to or an admission of fault, culpability or a
failure to act, by or on behalf of any indemnified party.
Section 9. Contribution. If the indemnification provided for in Section 8 is for
any reason held to be unavailable to or otherwise insufficient to hold harmless an indemnified
party in respect of any losses, claims, damages, liabilities or expenses referred to therein, then
each
24
indemnifying party shall contribute to the aggregate amount paid or payable by such
indemnified party, as incurred, as a result of any losses, claims, damages, liabilities or expenses
referred to therein (i) in such proportion as is appropriate to reflect the relative benefits
received by the Company, on the one hand, and the Underwriters, on the other hand, from the
offering of the Notes pursuant to this Agreement or (ii) if the allocation provided by clause (i)
above is not permitted by applicable law, in such proportion as is appropriate to reflect not only
the relative benefits referred to in clause (i) above but also the relative fault of the Company,
on the one hand, and the Underwriters, on the other hand, in connection with the statements or
omissions which resulted in such losses, claims, damages, liabilities or expenses, as well as any
other relevant equitable considerations. The relative benefits received by the Company, on the one
hand, and the Underwriters, on the other hand, in connection with the offering of the Notes
pursuant to this Agreement shall be deemed to be in the same respective proportions as the total
net proceeds from the offering of the Notes pursuant to this Agreement (before deducting expenses)
received by the Company, and the total underwriting discount received by the Underwriters, in each
case as set forth on the front cover page of the Prospectus bear to the aggregate initial public
offering price of the Notes as set forth on such cover. The relative fault of the Company, on the
one hand, and the Underwriters, on the other hand, shall be determined by reference to, among other
things, whether any such 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, on the
one hand, or the Underwriters, on the other hand, and the parties’ relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or omission.
The amount paid or payable by a party as a result of the losses, claims, damages, liabilities
and expenses referred to above shall be deemed to include, subject to the limitations set forth in
Section 8(c), any reasonable legal or other fees or expenses reasonably incurred by such party in
connection with investigating or defending any action or claim.
The Company and the Underwriters agree that it would not be just and equitable if contribution
pursuant to this Section 9 were determined by pro rata allocation (even if the Underwriters were
treated as one entity for such purpose) or by any other method of allocation which does not take
account of the equitable considerations referred to in this Section 9.
Notwithstanding the provisions of this Section 9, no Underwriter shall be required to
contribute any amount in excess of the underwriting commissions received by such Underwriter in
connection with the Notes underwritten by it and distributed to the public. No person guilty of
fraudulent misrepresentation (within the meaning of Section 11(f) of the Securities Act) shall be
entitled to contribution from any person who was not guilty of such fraudulent misrepresentation.
The Underwriters’ obligations to contribute pursuant to this Section 9 are several, and not joint,
in proportion to their respective underwriting commitments as set forth opposite their names in
Schedule A. For purposes of this Section 9, each director, officer, employee and agent of an
Underwriter and each person, if any, who controls an Underwriter within the meaning of the
Securities Act and the Exchange Act shall have the same rights to contribution as such Underwriter,
and each director of the Company, each officer of the Company who signed the Registration
Statement, and each person, if any, who controls the Company with the meaning of
25
the Securities Act and the Exchange Act shall have the same rights to contribution as the
Company.
Section 10. Default of One or More of the Several Underwriters. If, on the Closing
Date, any one or more of the several Underwriters shall fail or refuse to purchase Notes that it or
they have agreed to purchase hereunder on such date, and the aggregate principal amount of Notes,
which such defaulting Underwriter or Underwriters agreed but failed or refused to purchase does not
exceed 10% of the aggregate principal amount of the Notes to be purchased on such date, the other
Underwriters shall be obligated, severally, in the proportion to the aggregate principal amounts of
such Notes set forth opposite their respective names on Schedule A bears to the aggregate principal
amount of such Notes set forth opposite the names of all such non-defaulting Underwriters, or in
such other proportions as may be specified by the Representatives with the consent of the
non-defaulting Underwriters, to purchase such Notes which such defaulting Underwriter or
Underwriters agreed but failed or refused to purchase on such date. If, on the Closing Date, any
one or more of the Underwriters shall fail or refuse to purchase such Notes and the aggregate
principal amount of such Notes with respect to which such default occurs exceeds 10% of the
aggregate principal amount of Notes to be purchased on such date, and arrangements satisfactory to
the Representatives and the Company for the purchase of such Notes are not made within 48 hours
after such default, this Agreement shall terminate without liability of any party to any other
party except that the provisions of Sections 4, 6, 8, 9 and 17 shall at all times be effective and
shall survive such termination. In any such case, either the Representatives or the Company shall
have the right to postpone the Closing Date, but in no event for longer than seven days in order
that the required changes, if any, to the Registration Statement, any Issuer Free Writing
Prospectus, the Preliminary Prospectus or the 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 10. Any action taken under this
Section 10 shall not relieve any defaulting Underwriter from liability in respect of any default of
such Underwriter under this Agreement.
Section 11. Termination of this Agreement. Prior to the Closing Date, this
Agreement may be terminated by the Representatives by notice given to the Company if at any time
(i) trading or quotation in any of the Company’s securities shall have been suspended or limited by
the Commission or the New York Stock Exchange; (ii) trading in securities generally on either the
Nasdaq Stock Market or the New York Stock Exchange shall have been suspended or limited, or minimum
or maximum prices shall have been generally established on any of such stock exchanges by the
Commission or FINRA; (iii) a general banking moratorium shall have been declared by any of federal
or New York authorities; (iv) there shall have occurred any outbreak or escalation of national or
international hostilities or any crisis or calamity involving the United States, or any change in
the United States or international financial markets, or any substantial change or development
involving a prospective substantial change in United States or international political, financial
or economic conditions, as in the judgment of the Representatives is material and adverse and makes
it impracticable or inadvisable to market the Notes in the manner and on the terms described in the
Disclosure Package or the Prospectus or to enforce contracts for the sale of securities; (v) in the
judgment of the Representatives there shall
26
have occurred any Material Adverse Change; or (vi) there shall have occurred a material
disruption in commercial banking or securities settlement or clearance services. Any termination
pursuant to this Section 11 shall be without liability of any party to any other party except as
provided in Sections 4 and 6 hereof, and provided further that Sections 4, 6, 8, 9 and 17 shall
survive such termination and remain in full force and effect.
Section 12. No Fiduciary Duty. The Company acknowledges and agrees that: (i) the
purchase and sale of the Notes pursuant to this Agreement, including the determination of the
public offering price of the Notes and any related discounts and commissions, is an arm’s-length
commercial transaction between the Company, on the one hand, and the several Underwriters, on the
other hand, and the Company is capable of evaluating and understanding and understands and accepts
the terms, risks and conditions of the transactions contemplated by this Agreement; (ii) in
connection with each transaction contemplated hereby and the process leading to such transaction
each Underwriter is and has been acting solely as a principal and is not the financial advisor,
agent or fiduciary of the Company or its affiliates, stockholders, creditors or employees or any
other party; (iii) no Underwriter has assumed or will assume an advisory, agency or fiduciary
responsibility in favor of the Company with respect to any of the transactions contemplated hereby
or the process leading thereto (irrespective of whether such Underwriter has advised or is
currently advising the Company on other matters) and no Underwriter has any obligation to the
Company with respect to the offering contemplated hereby except the obligations expressly set forth
in this Agreement; (iv) the several Underwriters and their respective affiliates may be engaged in
a broad range of transactions that involve interests that differ from those of the Company and that
the several Underwriters have no obligation to disclose any of such interests by virtue of any
advisory, agency or fiduciary relationship; and (v) the Underwriters have not provided any legal,
accounting, regulatory or tax advice with respect to the offering contemplated hereby and the
Company has consulted its own legal, accounting, regulatory and tax advisors to the extent it
deemed appropriate.
This Agreement supersedes all prior agreements and understandings (whether written or oral)
between the Company and the several Underwriters with respect to the subject matter hereof. The
Company hereby waives and releases, to the fullest extent permitted by law, any claims that the
Company may have against the several Underwriters with respect to any breach or alleged breach of
agency or fiduciary duty.
Section 13. Representations and Indemnities to Survive Delivery. The respective
indemnities, agreements, representations, warranties and other statements of the Company, of its
officers and of the several Underwriters set forth in or made pursuant to this Agreement (i) will
remain operative and in full force and effect, regardless of any (A) investigation, or statement as
to the results thereof, made by or on behalf of any Underwriter, the officers or employees of any
Underwriter, or any person controlling the Underwriter, the Company, the officers or employees of
the Company, or any person controlling the Company, as the case may be or (B) acceptance of the
Notes and payment for them hereunder and (ii) will survive delivery of and payment for the Notes
sold hereunder and any termination of this Agreement.
27
Section 14. Notices. All communications hereunder shall be in writing and shall be
mailed, hand delivered or telecopied and confirmed to the parties hereto as follows:
If to the Representatives:
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇
Incorporated
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇-▇▇▇-▇▇-▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
Attention: High Grade Transaction Management/Legal
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇
▇▇▇-▇▇▇-▇▇-▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
Attention: High Grade Transaction Management/Legal
and
▇▇▇▇▇ Fargo Securities, LLC
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
Attention: Transaction Management
▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
Attention: Transaction Management
with a copy (which shall not constitute notice) to:
Shearman & Sterling LLP
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile: 212-848-7179
Attention: ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Esq.
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile: 212-848-7179
Attention: ▇▇▇▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇, Esq.
If to the Company:
Allied World Assurance Company Holdings, Ltd
▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇ ▇▇
▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇: ▇▇▇-▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇ ▇▇
▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇: ▇▇▇-▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
with a copy (which shall not constitute notice) to:
▇▇▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇▇ LLP
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Esq.
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇, ▇▇ ▇▇▇▇▇
Facsimile: ▇▇▇-▇▇▇-▇▇▇▇
Attention: ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇, Esq.
Any party hereto may change the address for receipt of communications by giving written notice
to the others.
28
Section 15. Successors. This Agreement will inure to the benefit of and be binding
upon the parties hereto, including any substitute Underwriters pursuant to Section 10 hereof, and
to the benefit of the directors, officers, employees, agents and controlling persons referred to in
Sections 8 and 9, and in each case their respective successors, and no other person will have any
right or obligation hereunder. The term “successors” shall not include any purchaser of the Notes
as such from any of the Underwriters merely by reason of such purchase.
Section 16. Partial Unenforceability. The invalidity or unenforceability of any
Section, paragraph or provision of this Agreement shall not affect the validity or enforceability
of any other Section, paragraph or provision hereof. If any Section, paragraph or provision of
this Agreement is for any reason determined to be invalid or unenforceable, there shall be deemed
to be made such minor changes (and only such minor changes) as are necessary to make it valid and
enforceable.
Section 17. Governing Law Provisions. THIS AGREEMENT SHALL BE GOVERNED BY, AND
CONSTRUED AND INTERPRETED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF NEW YORK APPLICABLE
TO AGREEMENTS MADE AND TO BE PERFORMED IN THAT STATE.
(a) Consent to Jurisdiction. Any legal suit, action or proceeding arising out of or based
upon this Agreement or the transactions contemplated hereby (“Related Proceedings”) may be
instituted in the federal courts of the United States of America located in the City and County of
New York, Borough of Manhattan, or the courts of the State of New York in each case located in the
City and County of New York, Borough of Manhattan (collectively, the “Specified Courts”),
and each party irrevocably submits to the exclusive jurisdiction (except for proceedings instituted
in regard to the enforcement of a judgment of any such court (a “Related Judgment”), as to
which such jurisdiction is non-exclusive) of such courts in any such suit, action or proceeding.
Service of any process, summons, notice or document by mail to such party’s address set forth above
shall be effective service of process for any suit, action or other proceeding brought in any such
court. The parties irrevocably and unconditionally waive any objection to the laying of venue of
any suit, action or other proceeding in the Specified Courts and irrevocably and unconditionally
waive and agree not to plead or claim in any such court that any such suit, action or other
proceeding brought in any such court has been brought in an inconvenient forum. Each party not
located in the United States irrevocably appoints CT Corporation System as its agent to receive
service of process or other legal summons for purposes of any such suit, action or proceeding that
may be instituted in any state or federal court in the City and County of New York.
(b) Waiver of Immunity. With respect to any Related Proceeding, each party irrevocably
waives, to the fullest extent permitted by applicable law, all immunity (whether on the basis of
sovereignty or otherwise) from jurisdiction, service of process, attachment (both before and after
judgment) and execution to which it might otherwise be entitled in the Specified Courts, and with
respect to any Related Judgment, each party waives any such immunity in the Specified Courts or any
other court of competent jurisdiction, and will not raise or claim or cause to be pleaded any such
immunity at or in respect of any such Related Proceeding or Related Judgment,
29
including, without limitation, any immunity pursuant to the United States Foreign Sovereign
Immunities Act of 1976, as amended.
Section 18. General Provisions. This Agreement may be executed in two or more
counterparts, each one of which shall be an original, with the same effect as if the signatures
thereto and hereto were upon the same instrument. This Agreement may not be amended or modified
unless in writing by all of the parties hereto, and no condition herein (express or implied) may be
waived unless waived in writing by each party whom the condition is meant to benefit. The Section
headings herein are for the convenience of the parties only and shall not affect the construction
or interpretation of this Agreement.
Each of the parties hereto acknowledges that it is a sophisticated business person who was
adequately represented by counsel during negotiations regarding the provisions hereof, including,
without limitation, the indemnification provisions of Section 8 and the contribution provisions of
Section 9, and is fully informed regarding said provisions. Each of the parties hereto further
acknowledges that the provisions of Sections 8 and 9 hereto fairly allocate the risks in light of
the ability of the parties to investigate the Company, its affairs and its business in order to
assure that adequate disclosure has been made in the Registration Statement, the Disclosure Package
and the Prospectus (and any amendments and supplements thereto), as required by the Securities Act
and the Exchange Act.
30
If the foregoing is in accordance with your understanding of our agreement, kindly sign and
return to the Company the enclosed copies hereof, whereupon this instrument, along with all
counterparts hereof, shall become a binding agreement in accordance with its terms.
|
Very truly yours, ALLIED WORLD ASSURANCE COMPANY HOLDINGS, LTD |
||||
| By: | /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ | |||
| Name: | ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇ | |||
| Title: | Executive Vice President, General Counsel & Corporate Secretary |
|||
31
The foregoing Underwriting Agreement is hereby confirmed and accepted by the Representatives
as of the date first above written.
▇▇▇▇▇▇▇ LYNCH, PIERCE, ▇▇▇▇▇▇ & ▇▇▇▇▇ INCORPORATED
▇▇▇▇▇ FARGO SECURITIES, LLC
▇▇▇▇▇ FARGO SECURITIES, LLC
Acting as Representatives of the
several Underwriters named in
the attached Schedule A.
several Underwriters named in
the attached Schedule A.
| By: | ▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated | |||
| By: | /s/ ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ | |||
| Name: | ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇ | |||
| Title: | Director | |||
| By: | ▇▇▇▇▇ Fargo Securities, LLC | |||
| By: | /s/ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ | |||
| Name: | ▇▇▇▇▇▇▇ ▇▇▇▇▇▇ | |||
| Title: | Director | |||
32
SCHEDULE A
| Aggregate | ||||
| Principal | ||||
| Amount of | ||||
| Notes to be | ||||
| Underwriters | Purchased | |||
▇▇▇▇▇▇▇ Lynch, Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated |
$ | 138,750,000 | ||
▇▇▇▇▇ Fargo Securities, LLC |
138,750,000 | |||
Deutsche Bank Securities Inc. |
22,500,000 | |||
Total |
$ | 300,000,000 | ||
1
SCHEDULE B
Below are the companies that have been added to or deleted from the Company’s corporate
organization list subsequent to the filing with the SEC of its Form 10-K for the year ended
December 31, 2009.
NEW COMPANIES
Allied World Assurance Company Holdings, AG
Allied World Assurance Company, AG
Allied World Europe Holdings, Ltd
Allied World Capital (Europe) Limited
2232 Services Limited
Allied World Assurance Company, AG
Allied World Europe Holdings, Ltd
Allied World Capital (Europe) Limited
2232 Services Limited
FORMER COMPANIES
Evolution Underwriting Inc.
Agency Marketing Services Inc.
All-South Professional Liability, Inc.
Raincross Insurance Company
Agency Marketing Services Inc.
All-South Professional Liability, Inc.
Raincross Insurance Company
1
ANNEX I
Issuer Free Writing Prospectuses
Final Term Sheet dated November 9, 2010
1
ANNEX II
Company Additional Written Communication
Electronic (Netroadshow) road show of the Company relating to the offering of the Notes dated
November 9, 2010.
1
ANNEX III
Significant Subsidiaries
Allied World Assurance Company, Ltd
Allied World Assurance Holdings (Ireland) Ltd
Allied World Assurance Holdings (U.S.) Inc.
Allied World Reinsurance Company
Allied World Assurance Holdings (Ireland) Ltd
Allied World Assurance Holdings (U.S.) Inc.
Allied World Reinsurance Company
1
EXHIBIT A
Form of Opinion of ▇▇▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇▇▇ LLP
(i) Each of Allied World Assurance Holdings (U.S.) Inc. and Allied World Reinsurance Company
(i) has been duly incorporated and is validly existing as a corporation in good standing under the
laws of the jurisdiction of its incorporation, (ii) has corporate power and authority to own or
lease, as the case may be, and operate its properties and to conduct its business as described in
the Disclosure Package and the Prospectus, and (iii) based solely on a review of the good standing
certificates of the secretaries of state of the relevant jurisdictions, 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 where the failure to have such power or authority or to be so qualified or to
be in good standing would not, individually or in the aggregate, result in a Material Adverse
Change.
(ii) Assuming the Agreement is duly executed and delivered by the Company under the laws of
Bermuda, to the extent the execution and delivery of this Agreement is governed by the laws of the
State of New York, this Agreement has been duly executed and delivered by the Company.
(iii) The Indenture has been duly qualified under the Trust Indenture Act and, assuming the
Indenture is duly executed and delivered by the Company under the laws of Bermuda, to the extent
the execution and delivery of the Indenture is governed by the laws of the State of New York, the
Indenture has been duly executed and delivered by the Company and (assuming the due authorization,
execution and delivery thereof by the Trustee) constitutes a valid and binding agreement of the
Company, enforceable against the Company in accordance with its terms, except as the enforcement
thereof may be limited by bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium
or other similar laws relating to or affecting the rights and remedies of creditors or by general
equitable principles (regardless of whether enforcement is considered in a proceeding in equity or
at law).
(iv) The Notes are in the form contemplated by the Indenture. Assuming the Notes are duly
executed by the Company under the laws of Bermuda, to the extent the execution of the Notes is
governed by the laws of the State of New York, the Notes have been duly executed and, when
authenticated in the manner provided for in the Indenture and delivered against payment of the
purchase price as specified in this Agreement, will constitute valid and binding obligations of the
Company, enforceable in accordance with their terms, except as the enforcement thereof may be
limited by bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium or other similar
laws relating to or affecting the rights and remedies of creditors or by general equitable
principles (regardless of whether enforcement is considered in a proceeding in equity or at law),
and will be entitled to the benefits of the Indenture.
(v) The Notes and the Indenture conform in all material respects to the descriptions thereof
contained in the Disclosure Package and the Prospectus.
(vi) The Registration Statement is an “automatic shelf registration statement,” as defined in
Rule 405 of the Securities Act, that automatically became effective not more than three years
A-1
prior to the Execution Time; to our knowledge (knowledge for purposes of this opinion and the
remainder of this opinion letter will be limited to the attorneys who are actively involved in
matters pertaining to the Company and its Subsidiaries) the Company has not received from the
Commission any notice pursuant to Rule 401(g)(2) of the Securities Act objecting to use of the
automatic shelf registration statement form and the Company has not otherwise ceased to be eligible
to use the automatic shelf registration form.
(vii) The Registration Statement, including without limitation the Rule 430B Information, the
Prospectus, excluding the documents incorporated by reference therein, and each amendment or
supplement to the Registration Statement and the Prospectus, excluding the documents incorporated
by reference therein, as of their respective effective or issue dates (including without limitation
each deemed effective date with respect to the Underwriters pursuant to Rule 430B(f)(2) of the
Securities Act), other than the financial statements and supporting schedules included therein or
omitted therefrom, and the Trustee’s Statement of Eligibility on Form T-1 (the “Form T-1”),
as to which we need express no opinion, complied as to form in all material respects with the
requirements of the Securities Act.
(viii) The documents incorporated or deemed to be incorporated by reference in the Registration
Statement, the Preliminary Prospectus and the Prospectus at the time they were or hereafter are
filed with the Commission, complied or will comply in all material respects with the requirements
of the Exchange Act.
(ix) To our knowledge, other than as set forth in each of the Preliminary Prospectus and the
Prospectus, there are no legal or governmental actions, suits or proceedings pending or threatened,
(i) against or affecting the Company or any of its subsidiaries, (ii) which has as the subject
thereof any officer or director of, or property owned or leased by, the Company or any of its
subsidiaries or (iii) relating to discrimination matters related to the Company or its
subsidiaries, where any such action, suit or proceeding, if determined adversely, could,
individually or in the aggregate, result in a Material Adverse Change or adversely affect the
consummation of the transactions contemplated by this Agreement.
(x) The statements in each of the Preliminary Prospectus and the Prospectus under the captions
“Description of Notes,” “Description of the Debt Securities” and “Certain United States Federal
Income Tax Considerations,” in each case insofar as such statements constitute a summary of the
legal matters, documents or proceedings referred to therein, fairly present and summarize, in all
material respects, the matters referred to therein.
(xi) The Company’s execution, delivery and performance of this Agreement and consummation of the
transactions contemplated hereby, by the Disclosure Package and by the Prospectus (i) will not
conflict with or constitute a breach of, or Default or a Debt Repayment Triggering Event under, or
result in the creation or imposition of any lien, charge or encumbrance upon any property or assets
of the Company or any of its subsidiaries pursuant to, or require the consent of any other party
to, any indenture, mortgage, deed of trust, loan agreement or other agreement or instrument that is
listed on the Exhibit Index to the Annual Report on Form 10-K pursuant to
A-2
Item 601(b)(4) or Item 601(b)(10) of Regulation S-K, and (ii) will not result in any violation of
any Applicable Law (as defined hereon)1, except in each of clauses (i) and
(ii), for such breaches, Defaults, Debt Repayment Triggering Events, liens, charges, encumbrances,
consents or violations that would not, individually or in the aggregate, result in a Material
Adverse Change or adversely affect the consummation of the transactions contemplated by this
Agreement. No consent, approval, authorization or other order of, or registration or filing with,
any court or other governmental or regulatory authority or agency is required by Applicable Law for
the Company’s execution, delivery and performance of this Agreement or consummation of the
transactions contemplated hereby, by the Disclosure Package or by the Prospectus, except (A) the
qualification under the Trust Indenture Act of the Indenture and (B) as have been obtained or made
by the Company and are in full force and effect under the Securities Act, applicable state
securities or blue sky laws (as to which counsel expresses no opinion) and from the FINRA (as to
which counsel expresses no opinion).
(xii) The Company is not, and after receipt of payment for the Notes and the application of the
proceeds thereof as contemplated under the caption “Use of Proceeds” in the Preliminary Prospectus
and the Prospectus will not be, required to register as an “investment company” within the meaning
of the Investment Company Act.
Nothing has come to our attention that would cause us to believe that (i) the Registration
Statement or any amendment thereto, including the information required under Rule 430B of the
Securities Act (except for financial statements, notes thereto and schedules and other financial
data included or incorporated by reference therein or omitted therefrom and the Form T-1, as to
which we need make no statement), as of its original effective date and at each deemed effective
date with respect to the Underwriter pursuant to Rule 430B(f)(2) of the Securities Act, 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, (ii) the Disclosure Package
(except for financial statements, notes thereto and schedules and other financial data included or
incorporated by reference therein or omitted therefrom, as to which we need make no statement), as
of the Initial Sale 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) the Prospectus or any amendment or supplement
thereto (except for financial statements, notes thereto and schedules and other financial data
included or incorporated by reference therein or omitted therefrom, as to which we need make no
statement), as of the date of the Prospectus, as of the date of any such amended or supplemented
prospectus or as of the date hereof, included or includes an untrue statement of a material fact
or omitted or omits to state a material fact necessary in order to make the statements therein, in
light of the circumstances under which they were made, not misleading.
In rendering our opinion, we assume, among other things, (a) the due organization and valid
existence of the Company, (b) the due authorization, execution, authentication and delivery
| 1 | When used in this opinion, the phrase “Applicable Law” means (a) federal laws of the United States and the laws of the State of New York, in each case of a type typically applicable to transactions of the type contemplated by this Agreement and (b) the General Corporation Law of the State of Delaware. |
A-3
by all persons (other than the Company, to the extent the authorization, execution,
authentication and delivery thereof is governed by the laws of the State of New York) of this
Agreement, the Indenture, the Notes and each of the documents related thereto, and (c) that each of
such parties has the legal power to act in the respective capacity or capacities in which he, she
or it is to act thereunder.
A-4
EXHIBIT B
Form of Opinion of ▇▇▇▇▇▇▇ ▇▇▇▇ & ▇▇▇▇▇▇▇ Limited
| 1. | Each of the Company, AWAC and AWAH Ireland are duly incorporated and existing under the laws of Bermuda in good standing (meaning solely that it has not failed to make any filing with any Bermuda government authority or to pay any Bermuda government fees or tax which would make it liable to be struck off the Register of Companies and thereby cease to exist under the laws of Bermuda). The Company possesses the capacity to ▇▇▇ and be sued in its own name under the laws of Bermuda. | |
| 2. | Each of the Company, AWAC and AWAH Ireland has the necessary corporate power and authority to own, lease and operate its respective properties and to conduct its respective business as described in the Prospectus and the Disclosure Package. | |
| 3. | The Company has the necessary corporate power and authority to enter into and perform its obligations under the Documents. The execution and delivery of the Documents by the Company and the performance by the Company of its obligations thereunder will not violate the memorandum of association or bye-laws of the Company nor any applicable law, regulation, order or decree in Bermuda. | |
| 4. | The Company has taken all corporate action required to authorise its execution and filing of the Registration Statement and its execution, delivery and performance of the Documents. The Registration Statement has been duly executed by or on behalf of the Company. The Documents have been duly executed and delivered by or on behalf of the Company, and constitute the valid, binding and enforceable obligations of the Company in accordance with the terms thereof. | |
| 5. | No order, consent, approval, licence, authorisation or validation of or exemption by any government or public body or authority of Bermuda or any sub-division thereof is required to authorise or is required in connection with the execution, delivery, performance and enforcement of the Documents or consummation by the Company of the transactions contemplated by the Documents, the Prospectus and the Disclosure Package, except such as have been duly obtained or filed in accordance with Bermuda law. | |
| 6. | It is not necessary or desirable to ensure the enforceability in Bermuda of the Documents that they be registered in any register kept by, or filed with, any governmental authority or regulatory body in Bermuda. However, to the extent that any of the Documents creates a charge over assets of the Company, it may be desirable to ensure the priority in Bermuda of the charge that it be registered in the Register of Charges in accordance with Section 55 of the Companies ▇▇▇ ▇▇▇▇. On registration, to the extent that Bermuda law governs the priority of a charge, such charge will have priority in Bermuda over any unregistered charges, and over any subsequently registered charges, in respect of the assets which are the subject of the charge. A registration fee of $557 will be payable in respect of the registration. |
B-1
| While there is no exhaustive definition of a charge under Bermuda law, a charge includes any interest created in property by way of security (including any mortgage, assignment, pledge, lien or hypothecation). As the Documents are governed by the Foreign Laws, the question of whether they create such an interest in property would be determined under the Foreign Laws. | ||
| 7. | There is no income or other tax of Bermuda imposed by withholding or otherwise on any payment to be made to or by the Company pursuant to the Documents. | |
| 8. | The Documents will not be subject to ad valorem stamp duty in Bermuda and no registration, documentary, recording, transfer or other similar tax, fee or charge is payable in Bermuda in connection with the execution, delivery, filing, registration or performance of the Documents other than as stated in paragraph 6 hereof and in respect of a filing fee for the filing of the Prospectus with the Registrar of Companies. | |
| 9. | The Company has received an assurance from the Ministry of Finance in Bermuda that in the event of there being enacted in Bermuda any legislation imposing tax computed on profits or income or computed on any capital asset, gain or appreciation, or any tax in the nature of estate duty or inheritance tax, then the imposition of any such tax shall not be applicable to the Company or any of its operations or its shares, debentures or other obligations (subject to the proviso expressed in such assurance as described in the Prospectus). | |
| 10. | The choice of the Foreign Laws as the governing law of the Documents is a valid choice of law and would be recognised and given effect to in any action brought before a court of competent jurisdiction in Bermuda, except for those laws (i) which such court considers to be procedural in nature, (ii) which are revenue or penal laws or (iii) the application of which would be inconsistent with public policy, as such term is interpreted under the laws of Bermuda. The submission in the Documents to the exclusive jurisdiction of the Foreign Courts and the appointment of [CT Corporation System] as its agent for service of legal process in connection with the proceedings in the Foreign Courts pursuant to the Documents is valid and binding upon the Company. | |
| 11. | The courts of Bermuda would recognise as a valid judgment, a final and conclusive judgment in personam obtained in the Foreign Courts against the Company based upon the Documents under which a sum of money is payable (other than a sum of money payable in respect of multiple damages, taxes or other charges of a like nature or in respect of a fine or other penalty) and would give a judgment based thereon provided that (a) such courts had proper jurisdiction over the parties subject to such judgment; (b) such courts did not contravene the rules of natural justice of Bermuda; (c) such judgment was not obtained by fraud; (d) the enforcement of the judgment would not be contrary to the public policy of Bermuda; (e) no new admissible evidence relevant to the action is submitted prior to the rendering of the judgment by the courts of Bermuda; and (f) there is due compliance with the correct procedures under the laws of Bermuda. |
B-2
| 12. | The Underwriters will not be deemed to be resident, domiciled or carrying on business in Bermuda by reason only of the execution, performance and/or enforcement of the Documents by the Underwriters. | |
| 13. | Each of the Underwriters has standing to bring an action or proceedings before the appropriate courts in Bermuda for the enforcement of the Documents. It is not necessary or advisable in order for the Underwriters to enforce their rights under the Documents, including the exercise of remedies thereunder, that they be licensed, qualified or otherwise entitled to carry on business in Bermuda. | |
| 14. | Based solely on a search of the Register of Charges maintained by the Registrar of Companies pursuant to Section 55 of the Companies ▇▇▇ ▇▇▇▇ conducted at [TIME] on [DATE] (which would not reveal details of matters which have been lodged for registration but not actually registered at the time of our search), there are [no] charges registered on the assets of the Company. | |
| 15. | Based solely upon a search of the Cause Book of the Supreme Court of Bermuda conducted at [TIME] on [DATE] (which would not reveal details of proceedings which have been filed but not actually entered in the Cause Book at the time of our search), there are no judgments against the Company, nor any legal or governmental proceedings pending in Bermuda to which the Company is subject. | |
| 16. | The Company is not entitled to any immunity under the laws of Bermuda, whether characterised as sovereign immunity or otherwise, from any legal proceedings to enforce the Documents in respect of itself or its property. | |
| 17. | The statements contained in the Prospectus and the Disclosure Package under the caption “Risk Factors — It may be difficult to enforce service of process and enforce judgments against us and our officers and directors” and in the Company’s annual report on Form 10K for the year ended 31 December 2009 incorporated by reference in the Prospectus and the Disclosure Package under the captions “Business Regulatory Matters – Bermuda” and “Risk Factors – Our business could be adversely affected by Bermuda employment restrictions”, to the extent that they constitute statements of Bermuda law, are accurate in all material respects. | |
| 18. | Based solely upon a review of the register of members of AWAC certified by the Secretary of AWAC on [DATE], all the issued and outstanding shares of AWAC are registered in the name of [the Company] and are validly issued, fully paid and non-assessable (which term when used herein means that no further sums are required to be paid by the holders thereof in connection with the issue thereof. | |
| 19. | Based solely upon a review of the register of members of AWAH Ireland certified by the Secretary of AWAH Ireland on [DATE], all the issued and outstanding shares of AWAH Ireland are registered in the name of [the Company] and are validly issued, fully paid and non-assessable (which term when used herein means that no further sums are required to be paid by the holders thereof in connection with the issue thereof. |
B-3
| 20. | Based solely upon a review of the register of members of the Company certified by the Secretary of the Company on [DATE] and the Company Constitutional Documents, all of the issued and outstanding common shares of the Company are validly issued, fully paid and non-assessable (which term when used herein means that no further sums are required to be paid by the holders thereof in connection with the issue thereof). | |
| 21. | Based solely upon a review of the register of members of the Company certified by the Secretary of the Company on [DATE] and the Company Constitutional Documents, the authorized, issued and outstanding share capital of the Company is as set forth in the Prospectus and the Disclosure Package under the caption “Capitalization” | |
| 22. | Based solely on a search of the public records in respect of the Company maintained at the offices of the Registrar of Companies at [TIME] on [DATE] (which would not reveal details of matters which have not been lodged for registration or have been lodged for registration but not actually registered at the time of our search) and a search of the Cause Book of the Supreme Court of Bermuda conducted at [TIME] on [DATE] (which would not reveal details of proceedings which have been filed but not actually entered in the Cause Book at the time of our search), no details have been lodged of any steps taken in Bermuda for the appointment of a receiver or liquidator to, or for the winding-up, dissolution, reconstruction or reorganisation of, the Company, though it should be noted that the public files maintained by the Registrar of Companies do not reveal whether a winding-up petition or application to the Court for the appointment of a receiver has been presented and entries in the Cause Book may not specify the nature of the relevant proceedings. |
B-4
EXHIBIT C
Allied World Assurance Company Holdings, Ltd
5.50% Senior Notes due 2020
5.50% Senior Notes due 2020
Issuer: |
Allied World Assurance Company Holdings, Ltd | |
Title of Securities: |
Senior Notes due 2020 (the “Notes”) | |
Security Type: |
Senior Fixed Rate Notes | |
Format: |
SEC Registered | |
Trade Date: |
November 9th, 2010 | |
Settlement Date: |
November 15th, 2010 (T+3) | |
Maturity Date: |
November 15th, ▇▇▇▇ | |
▇▇▇▇▇▇▇▇▇ Principal Amount Offered: |
$300,000,000 | |
Price to the Public (Issue Price): |
99.544% | |
Price to Issuer: |
98.894% | |
Net Proceeds (After Net Expenses): |
$296,682,000 | |
Treasury Benchmark : |
2.625% due August 15th, 2020 | |
Benchmark Treasury Yield: |
2.660% | |
Spread to Treasury Benchmark: |
Treasury Rate plus 290 basis points | |
Re-offer Yield: |
5.560% | |
Coupon: |
5.500% per annum | |
Interest Payment Dates: |
Semi-annually on May 15th and November 15th of each year, commencing on May 15th, 2011 | |
Optional Redemption: |
Make-whole call at any time at a discount rate of U.S. Treasuries plus 50 basis points | |
CUSIP; ISIN: |
▇▇▇▇▇▇▇▇▇; US01959EAB48 | |
Anticipated Ratings* (▇▇▇▇▇’▇ / S&P) |
Baa 1 (stable) / BBB (pos) | |
Minimum Denominations: |
$2,000 and integral multiples of $1,000 in excess thereof | |
Book-Running Managers: |
BofA ▇▇▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ Fargo Securities, LLC | |
Joint-Lead: |
Deutsche Bank Securities Inc. |
C-1
| * | A securities rating is not a recommendation to buy, sell or hold securities and may be subject to revision or withdrawal at any time. Each credit rating should be evaluated independently of any other credit rating. |
The issuer has filed a registration statement (including a prospectus and a preliminary prospectus
supplement) with the Securities and Exchange Commission (the “SEC”) for the offering to which this
communication relates. Before you invest, you should read the prospectus and the preliminary
prospectus supplement in that registration statement and other documents the issuer has filed with
the Commission for more complete information about the issuer and this offering. You may get these
documents for free by visiting ▇▇▇▇▇ on the Commission website at ▇▇▇.▇▇▇.▇▇▇. Alternatively, the
issuer, any underwriter or dealer participating in the offering will arrange to send you the
prospectus and the preliminary prospectus supplement if you request it by contacting ▇▇▇▇▇▇▇ Lynch,
Pierce, ▇▇▇▇▇▇ & ▇▇▇▇▇ Incorporated toll-free at 1-800-294-1322 or ▇▇▇▇▇ Fargo Securities, LLC,
toll-free at ▇-▇▇▇-▇▇▇-▇▇▇▇.
C-2