EXHIBIT 99(c)
EXHIBIT B
REGISTRATION RIGHTS AGREEMENT
This REGISTRATION RIGHTS AGREEMENT (this "AGREEMENT"), dated as of October
___, 2002, by and between the Purchasers listed on the signature pages hereto
(the "PURCHASERS"), and WHITE MOUNTAINS INSURANCE GROUP, LTD., a company
existing under the laws of Bermuda (the "COMPANY").
W I T N E S S E T H:
WHEREAS, this Agreement is entered into pursuant to that certain
Subscription Agreement between the Purchasers and the Company dated as of
October 23, 2002 (the "SUBSCRIPTION AGREEMENT"), pursuant to which, among other
things, the Purchasers agreed to purchase from the Company, for a purchase price
of $199,999,970, 677,966 Convertible Preference Shares, convertible into Common
Shares under the terms and conditions set forth in the resolution of the Board
of Directors related thereto (the "RESOLUTION"); and
WHEREAS, in connection with the transactions contemplated by the
Subscription Agreement, the parties hereto desire to provide for certain rights
and obligations in respect of the Common Shares as hereinafter provided.
NOW, THEREFORE, in consideration of the mutual agreements, covenants,
representations and warranties contained herein and in the Subscription
Agreement, the parties hereto, intending to be legally bound, hereby agree as
follows:
1. DEFINITIONS. As used in this Agreement, the following terms have the
following meanings:
"AFFILIATE" of a specified Person means any Person that is a direct or
indirect wholly owned subsidiary of such Person.
"BEST EFFORTS" means the commercially reasonable efforts that a prudent
person desirous of achieving a result would use in good faith in similar
circumstances to ensure that such result may be achieved as expeditiously as can
reasonably be expected.
"BOARD" means the board of directors of the Company.
"COMMON SHARES" means common shares of the Company, par value $1.00 per
share.
"COMPANY REGISTRATION STATEMENT" shall have the meaning ascribed to such
term in Section 2(f).
"CONVERSION SHARES" means the Common Shares issuable or issued upon
conversion of the Convertible Preference Shares, as the number and/or type of
such shares may be adjusted from time to time pursuant to the terms and
conditions of the Subscription Agreement and the Resolution.
"DELAY PERIOD" shall have the meaning ascribed to such term in
Section 2(f).
"DEMAND" shall have the meaning ascribed to such term in Section 2(a).
"DEMAND REGISTRATION" shall have the meaning ascribed to such term in
Section 2(a).
"DISADVANTAGEOUS CONDITION" shall have the meaning ascribed to such term in
Section 2(f).
"EXCHANGE ACT" means the Securities Exchange Act of 1934, as amended, or
any successor statute.
"HOLDER" or "HOLDERS" means each Purchaser or any Permitted Transferee
thereof which is the record holder of Registrable Securities.
"MINIMUM NUMBER" means 250,000 Common Shares; PROVIDED that, the Minimum
Number shall be adjusted by the same ratio as the number of outstanding Common
Shares is adjusted in the event of any reclassification, share combination,
share subdivision, share dividend or similar event with respect to the Common
Shares.
"OTHER HOLDERS" shall have the meaning ascribed to such term in
Section 3(b).
"OTHER SECURITIES" shall have the meaning ascribed to such term in
Section 3.
"PERMITTED TRANSFEREE" shall mean (i) any Affiliate of a Holder or (ii) any
permitted transferee of Convertible Preference Shares under Section 10 of the
Resolution.
"PERSON" means any person or entity of any nature whatsoever, specifically
including an individual, a firm, a company, a corporation, a partnership, a
trust or other entity.
"PURCHASER" means each person other than the Company listed on the
signature pages of this Agreement as a party hereto.
"REGISTRABLE SECURITIES" means the Conversion Shares and any stock or other
securities into which or for which such Conversion Shares may hereafter be
changed, converted or exchanged upon any reclassification, share combination,
share subdivision, share dividend, merger, consolidation or similar transactions
or events, including without limitation according to the terms of the
Subscription Agreement and the Resolution; PROVIDED that any such securities
shall cease to be Registrable Securities if (i) a registration statement with
respect to the sale of such securities shall have become effective under the
Securities Act and such securities shall have been disposed of in accordance
with the plan of distribution set forth in such registration statement or (ii)
such securities shall have been transferred pursuant to Rule 144.
"REGISTRATION EXPENSES" means all reasonable expenses in connection with
any registration of securities pursuant to this Agreement including, without
limitation, the following: (i) SEC filing fees; (ii) the fees, disbursements and
expenses of the Company's counsel and accountants in connection with the
registration of the Registrable Securities to be disposed of under the
Securities Act; (iii) all expenses in connection with the preparation, printing
and filing of the registration statement, any preliminary
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prospectus or final prospectus and amendments and supplements thereto and the
mailing and delivering of copies thereof to any stockholders, underwriters and
dealers and all expenses incidental to delivery of the Registrable Securities;
(iv) the cost of producing blue sky or legal investment memoranda; (v) all
expenses in connection with the qualification of the Registrable Securities to
be disposed of for offering and sale under state securities laws, including the
reasonable fees and disbursements of counsel for the underwriters and the
Holders in connection with such qualification and in connection with any blue
sky and legal investments surveys; (vi) the filing fees incident to securing any
required review by the National Association of Securities Dealers, Inc. of the
terms of the sale of the Registrable Securities to be disposed of; (vii)
transfer agents', depositories' and registrars' fees and the fees of any other
agent appointed in connection with such offering; (viii) all security engraving
and security printing expenses; (ix) all fees and expenses payable in connection
with the listing of the Registrable Securities on each securities exchange or
inter-dealer quotation system on which a class of common equity securities of
the Company is then listed; (x) all reasonable out-of-pocket expenses of the
Company incurred in connection with road-show presentations, if any; (xi)
courier, overnight delivery, word processing, duplication, telephone and
facsimile expenses; (xii) any one-time payment for directors and officers
insurance directly related to such offering, provided the insurer provides a
separate statement for such payment and (xiii) the reasonable and documented
fees and expenses of one law firm for the Holders; PROVIDED, HOWEVER, that each
Selling Holder shall pay (y) all underwriting discounts, commissions, fees and
expenses (including legal expenses other than as provided above) of any person
with respect to the Registrable Securities sold by or on behalf of such Holders.
In no event shall the Company pay or be responsible for the fees and
disbursements of counsel for the underwriters in connection with any such
registrations, except as provided in clause (v) above.
"REQUESTING HOLDER" shall have the meaning ascribed to such term in
Section 3.
"RESOLUTION" has the meaning set forth in the preamble to the Agreement.
"RULE 144" means Rule 144 promulgated under the Securities Act, or any
successor rule to similar effect.
"SEC" means the United States Securities and Exchange Commission.
"SECURITIES ACT" means the Securities Act of 1933, as amended, or any
successor statute.
"SELLING HOLDER" means any Holder selling Registrable Securities by means
of a registration statement pursuant to this Agreement.
"SUBSCRIPTION AGREEMENT" has the meaning set forth in the preamble to the
Agreement.
2. DEMAND REGISTRATION.
(a) At any time after the issuance of Conversion Shares upon
conversion of Convertible Preference Shares pursuant to the terms and conditions
of the Resolution, upon written notice (a "DEMAND") from those Holders together
holding not less than the Minimum Number of the Registrable Securities
requesting that the Company effect the
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registration under the Securities Act (a "DEMAND REGISTRATION") of any or all of
the Registrable Securities held by such Holder(s), which notice shall specify
the intended method or methods of disposition of such Registrable Securities,
the Company promptly shall give written notice to each other Holder of the
receipt by the Company of such Demand. Within 10 days of the date of the written
notice by the Company, each other Holder that wishes to participate in such
Demand Registration shall notify the Company in writing indicating that such
Holder wishes to have its Registrable Securities included in the Demand
Registration and the number of Registrable Securities it desires to include in
the Demand Registration. The Company shall use its Best Efforts to prepare and
file a registration statement under the Securities Act relating to the
Registrable Securities to be offered as soon as practicable, but in no event
later than 60 days (90 days if the applicable registration form is other than
Form S-3) after the date such Demand is given, and use its Best Efforts to cause
the same to become effective as promptly as practicable thereafter, in the
manner set forth in Section 5.
(b) Notwithstanding any other provision of this Agreement to the
contrary, a Demand Registration requested by any Holder(s) pursuant to this
Section 2 shall not be deemed to have been effected: (i) if it is withdrawn as a
result of a Disadvantageous Condition as described in Section 2(f)(iv); (ii) if
after it has become effective such registration is interfered with by any stop
order, injunction or other order or requirement of the SEC or other governmental
agency or court for any reason other than a misrepresentation or an omission by
such Holder(s) and, as a result thereof, less than 75% of the Registrable
Securities requested to be registered can be completely distributed in
accordance with the plan of distribution set forth in the related registration
statement; (iii) if the conditions to closing that relate to the Company
specified in the purchase agreement or underwriting agreement entered into in
connection with such registration are not satisfied or waived; or (iv) if, with
respect to such Demand Registration, the Company fails to keep the related
registration statement effective for the period required under
Section 5(a)(i)(x).
(c) In the event that any registration pursuant to this Section 2
shall involve, in whole or in part, an underwritten offering, the Holder(s)
initiating the Demand Registration pursuant to Section 2(a) shall have the right
to designate an underwriter as the sole lead managing underwriter of such
underwritten offering, subject to the Company's consent which shall not be
unreasonably withheld.
(d) In the event that the Holders participating in a Demand
Registration are advised in writing (with a copy to the Company) by the lead
managing underwriter designated by the initiating Holder(s) pursuant to
Section 2(c) that, in such firm's good-faith opinion, marketing factors require
a limitation on the number of shares to be underwritten, the number of shares to
be included in the underwriting and registration shall be allocated to the
Holders participating in the Demand Registration PRO RATA based on the number of
Registrable Securities requested to be included in the Demand Registration by
each such Holder.
(e) Unless the number of shares to be underwritten has been limited in
accordance with Section 2(d), the Company shall have the right to cause the
registration of additional securities for sale for the account of any person
(including the Company) in any registration of Registrable Securities requested
by any Holder(s) pursuant to Section 2(a); PROVIDED that in the event that such
Holder(s) are advised in writing (with a copy to the Company) by the lead
managing underwriter designated by the initiating Holder(s)
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pursuant to Section 2(c) that, in such firm's good-faith opinion, marketing
factors require a limitation on the number of shares to be underwritten, the
number of shares to be included in the underwriting and registration shall be
allocated first to the Holder(s) taking part in the Demand Registration pursuant
to Section 2(a) and second to such additional persons (including the Company)
seeking to participate in such registration on such basis as the Company may
determine.
(f) Notwithstanding any other provision of this Agreement to the
contrary, (i) the Company shall not be required to effect a Demand Registration
within a period of six months after the effective date of any other registration
statement of the Company, provided that, if required pursuant to Section 3,
notice of such registration statement has been given to all Holders pursuant to
Section 3, (ii) the Company shall not be obligated to effect more than a total
of one Demand Registration pursuant to this Section 2, (iii) the Company shall
not be required to effect a Demand Registration if the Demand related thereto is
delivered during the period commencing 45 days prior to the estimated date of
filing by the Company of a registration statement pertaining to a public
offering of securities of the Company (a "COMPANY REGISTRATION STATEMENT") that
are the same as, or convertible into or exchangeable for, Common Shares (other
than a registration statement on Form S-8 or successor form) and ending on the
date of effectiveness of such registration statement; PROVIDED, that in no event
shall the Company be required to file a registration statement pertaining to a
Demand Registration at any time prior to 90 days after the effectiveness of any
Company Registration Statement and (iv) with respect to any registration
statement filed, or to be filed, pursuant to this Section 2, if the Company
shall furnish to the Holder(s) requesting such registration a certified
resolution of the Board stating that in the good faith judgment of the Board it
would not (because of the existence of, or in anticipation of, any acquisition
or material financing activity, or the unavailability for reasons beyond the
Company's control of any required financial statements, or any other event or
condition of similar significance to the Company) be in the best interests (a
"DISADVANTAGEOUS CONDITION") of the Company for such a registration statement to
be maintained effective, or to be filed and become effective, the Company may
postpone the filing or the effectiveness of such registration statement, or
delay the filing of any amendment thereto, until the earlier of 90 days
following the date such certified resolution is furnished to such Holder(s) or
the date such Disadvantageous Condition no longer exists (such period, a "DELAY
PERIOD"); PROVIDED, HOWEVER, that the Delay Periods in any six consecutive
months may not exceed 90 days. Upon receipt of any such notice of a
Disadvantageous Condition, the Holder(s) selling securities pursuant to an
effective registration statement shall discontinue use of the prospectus
contained in such registration statement and, if so directed by the Company,
shall deliver to the Company all copies, other than permanent file copies then
in such Holders' possession, of the prospectus then covering such Registrable
Securities or, in the event no registration statement shall have been filed, all
drafts of the registration statement and the prospectus covering such
Registrable Securities.
3. PIGGYBACK REGISTRATION. At any time after the issuance of
Conversion Shares pursuant to the conversion of Convertible Preference Shares
pursuant to the terms of the Resolution, if the Company proposes to register any
of its Common Shares or any other of its common equity securities (collectively,
"OTHER SECURITIES") under the Securities Act (other than a registration (i) on
Form S-4 or S-8 or any successor form thereto, (ii) filed in connection with an
offering of securities solely to the Company's existing shareholders or (iii)
pursuant to a registration under Section 2), whether or not for sale for its own
account, in a manner which would permit registration
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of Registrable Securities for sale for cash to the public under the Securities
Act, at each such time it will give prompt written notice to each Holder of its
intention to do so at least thirty (30) days prior to the anticipated filing
date of the registration statement relating to such registration. Such notice
shall offer each such Holder the opportunity to include in such registration
statement such number of Registrable Securities as each such Holder may request.
Upon the written request of any such Holder (each, a "REQUESTING HOLDER") made
within twenty (20) days after the receipt of the Company's notice (which request
shall specify the number of Registrable Securities intended to be disposed of
and the intended method of disposition thereof), the Company shall use its Best
Efforts to effect, in the manner set forth in the applicable provisions of
Section 5, in connection with the registration of the Other Securities, the
registration under the Securities Act of all Registrable Securities which the
Company has been so requested to register, to the extent required to permit the
disposition (in accordance with such intended methods thereof) of the
Registrable Securities so requested to be registered, provided that:
(a) if, at any time after giving such written notice of its intention
to register any of its securities and prior to the effective date of the
registration statement filed in connection with such registration, the
Company shall determine for any reason not to register such securities, the
Company may, at its election, give written notice of such determination to
each Requesting Holder of Registrable Securities and thereupon shall be
relieved of its obligation to register any Registrable Securities in
connection with such registration (but not from its obligation to pay the
Registration Expenses in connection therewith as provided in Section 4),
without prejudice, however, to the rights of Holders to request that such
registration be effected as a registration under Section 2;
(b) if the registration referred to in the first sentence of this
Section 3 is to be an underwritten registration on behalf of the Company or
on behalf of the holders of securities (other than Registrable Securities)
of the Company (the "OTHER HOLDERS"), and the managing underwriter
designated by the Company or the Other Holders, as applicable, advises the
Company in writing that, in such firm's good-faith opinion, marketing
factors require a limitation on the number or amount of shares to be
underwritten, the Company shall include in such registration: (1) first,
all securities the Company or any Other Holder, as applicable, proposes to
sell for its own account and (2) second, up to such number or amount of
securities (including Registrable Securities) recommended by such managing
underwriter, to such additional persons seeking to participate in such
registration, allocated PRO RATA based on the number of shares requested to
be included by such additional persons;
(c) in the event that any registration pursuant to this Section 3
shall involve, in whole or in part, an underwritten offering, each
Requesting Holder pursuant to this Section 3 hereby agrees to sell such
portion of its Registrable Securities to be registered pursuant to Section
3(a) to the managing underwriter(s) designated by the Company or the Other
Holders, as applicable, on the same terms and conditions that apply to the
Company and/or the Other Holders; PROVIDED, HOWEVER, that any such
Requesting Holder shall be permitted to withdraw all or part of the
Registrable Securities from such registration at any time prior to the
execution of the underwriting agreement relating thereto and PROVIDED
FURTHER, HOWEVER, the Requesting Holders shall only be required to make
representations
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and warranties and provide indemnity as is customary for selling
stockholders in similar registrations; and
(d) no registration of Registrable Securities effected under this
Section 3 shall relieve the Company of its obligation to effect a
registration of Registrable Securities pursuant to Section 2 hereof.
4. EXPENSES. The Company agrees to pay all Registration Expenses with
respect to any offerings pursuant to Section 2 or Section 3 hereof. In addition,
but not in duplication of, the foregoing, each Holder shall be entitled to
reimbursement from the Company for any out-of-pocket losses actually incurred in
the event, and only to the extent, that such Holder suffers such losses as a
result of such Holder's inability to make delivery of sold Registrable
Securities due to the Company's breach of its commitment to provide timely
notice as required by Section 5(a)(v).
5. REGISTRATION AND QUALIFICATION.
(a) If and whenever the Company is required to use its Best Efforts to
effect the registration of any Registrable Securities under the Securities Act
as provided in Section 2 or 3 hereof, the Company shall:
(i) prepare and file with the SEC such amendments and supplements to
such registration statement and the prospectus used in connection therewith
as may be necessary to (x) keep such registration statement effective until
the earlier of such time as all of such Registrable Securities have been
disposed of in accordance with the intended methods of disposition by the
Holder(s) thereof set forth in such registration statement or the
expiration of 90 days after such registration statement becomes effective
and (y) comply with the provisions of the Securities Act applicable to the
Company with respect to the securities covered by such registration
statement;
(ii) furnish to the Selling Holder(s) and to any underwriter of such
Registrable Securities such number of conformed copies of such registration
statement and of each such amendment and supplement thereto (in each case
including all exhibits) and such number of copies of the prospectus
included in such registration statement (including each preliminary
prospectus and any summary prospectus), in conformity with the requirements
of the Securities Act, and such other documents, as the Selling Holder(s)
or such underwriter may reasonably request in order to facilitate the
public sale of the Registrable Securities, and a copy of any and all
transmittal letters or other correspondence to, or received from, the SEC
or any other governmental agency or self-regulatory body or other body
having jurisdiction (including any domestic or foreign securities exchange)
relating to such offering;
(iii) unless the exemption from state regulation of securities
offerings under Section 18 of the Securities Act applies, use its Best
Efforts to register or qualify all Registrable Securities covered by such
registration statement under the securities or blue sky laws of such
jurisdictions as the Selling Holders or any underwriter of such Registrable
Securities shall reasonably request; PROVIDED that the Company shall not be
required to (A) qualify generally to do business in any jurisdiction where
it would not otherwise be required to qualify but for this
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paragraph (iii), (B) subject itself to taxation in any such jurisdiction or
(C) consent to general service of process in any such jurisdiction;
(iv) furnish, at the written request of any Holder requesting
registration pursuant to Section 2, if the method of distribution is by
means of an underwritten offering, on the date that the Registrable
Securities are delivered to the underwriters for sale pursuant to such
registration or, if such Registrable Securities are not being sold through
underwriters, on the date that the registration statement with respect to
such Registrable Securities becomes effective: (x) an opinion of counsel
for the Company, dated such date and (y) a "cold comfort" letter dated such
date and the date the offering is priced, signed by the independent public
accountants who have certified the Company's financial statements included
in such registration statement, covering substantially the same matters
with respect to such registration statement (and the prospectus included
therein) and, in the case of such accountants' letter, with respect to
events subsequent to the date of such financial statements, as are
customarily covered in opinions of issuer's counsel and in accountants'
letters delivered to underwriters in underwritten public offerings of
securities;
(v) promptly notify the Selling Holders in writing (x) at any time
when a prospectus relating to a registration pursuant to Section 2 or 3
hereof is required to be delivered under the Securities Act of the
happening of any event as a result of which the prospectus included in such
registration statement, as then in effect, includes an untrue statement of
a material fact or omits to state any material fact required to be stated
therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading, and (y) of any
request by the SEC or any other regulatory body or other body having
jurisdiction for any amendment of or supplement to any registration
statement or other document relating to such offering, and in either such
case (x) or (y) at the request of the Selling Holders, subject to
Section 2(f)(iv) and Section 4 hereof, prepare and furnish to the Selling
Holders a reasonable number of copies of a supplement to or an amendment of
such prospectus as may be necessary so that, as thereafter delivered to the
purchasers of such Registrable Securities, such prospectus shall not
include an untrue statement of material fact or omit to state a material
fact required to be stated therein or necessary to make the statements
therein, in light of the circumstances under which they are made, not
misleading;
(vi) use its Best Efforts to comply with all applicable rules and
regulations of the SEC and to make available to its securities holders, as
soon as reasonably practicable, an earnings statement covering the period
of at least twelve (12) months, but not more than eighteen (18) months,
beginning after the effective date of such registration statement, which
earnings statement shall satisfy the provisions of Section 11(a) of the
Securities Act; and
(vii) furnish unlegended certificates representing ownership of the
Registrable Securities being sold in such denominations as shall be
requested by the Selling Holders or the underwriters, with expenses
therewith to be paid in accordance with Section 4 hereof.
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(b) The Holder(s) of Registrable Securities on whose behalf
Registrable Securities are to be distributed by one or more underwriters shall
be parties to any underwriting agreements relating to the distribution of such
Registrable Securities.
6. UNDERWRITING, DUE DILIGENCE.
(a) If requested by the underwriters for any underwritten offering of
Registrable Securities pursuant to a registration requested under Section 2 of
this Agreement, the Company shall enter into an underwriting agreement in
customary form with such underwriters for such offering, such agreement to
contain such representations and warranties by the Company and such other terms
and provisions as are customarily contained in underwriting agreements with
respect to such distributions, including, without limitation, indemnities and
contribution substantially to the effect and to the extent provided in Section 7
hereof and the provision of opinions of counsel and accountants' letters to the
effect and to the extent provided in Section 5(a)(iv) hereof. The Holders on
whose behalf the Registrable Securities are to be distributed by such
underwriters shall be parties to any such underwriting agreement. Such
underwriting agreement shall also contain such representations and warranties by
the Holders on whose behalf the Registrable Securities are to be distributed as
are customarily contained in underwriting agreements with respect to such
distributions. The Selling Holders may require that any additional securities
included in a Demand Registration be included on the same terms and conditions
as the Registrable Securities that are included therein.
(b) In the event that any registration pursuant to Section 3 shall
involve, in whole or in part, an underwritten offering, the Company may require
the Registrable Securities requested to be registered pursuant to Section 3 to
be included in such underwriting on the same terms and conditions as shall be
applicable to the other securities being sold through underwriters under such
registration. If requested by the underwriters for such underwritten offering,
the Holders on whose behalf the Registrable Securities are to be distributed
shall enter into an underwriting agreement with such underwriters, such
agreement to contain such representations and warranties by the Holders and such
other terms and provisions as are customarily contained in underwriting
agreements with respect to such distributions, including, without limitation,
indemnities and contribution substantially to the effect and to the extent
provided in Section 7 hereof. Such underwriting agreement shall also contain
such representations and warranties by the Company and such other person or
entity for whose account securities are being sold in such offering as are
customarily contained in underwriting agreements with respect to such
distributions.
(c) In connection with the preparation and filing of each registration
statement registering Registrable Securities under the Securities Act, the
Company shall give the Selling Holders and the underwriters, if any, and their
respective counsel and accountants, such reasonable and customary access to its
books and records and such opportunities to discuss the business of the Company
with its officers and the independent public accountants who have certified the
Company's financial statements as shall be necessary, in the opinion of such
Selling Holders and such underwriters or their respective counsel, to conduct a
reasonable investigation within the meaning of the Securities Act.
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7. INDEMNIFICATION AND CONTRIBUTION.
(a) In the case of any registration of any Registrable Securities
under the Securities Act pursuant to Sections 2 and 3 of this Agreement, the
Company agrees to indemnify and hold harmless each Selling Holder, its officers
and directors, each underwriter of Registrable Securities so offered and each
person, if any, who controls any of the foregoing persons within the meaning of
the Securities Act, from and against any and all losses, claims, damages,
expenses, judgments or liabilities, joint or several, to which they or any of
them may become subject, under the Securities Act or otherwise, including any
amount paid in settlement of any litigation commenced or threatened, and shall
promptly reimburse them, as and when incurred, for any reasonable legal or other
expenses incurred by them in connection with investigating any claims and
defending any actions, insofar as such losses, claims, damages, expenses,
judgments or liabilities shall arise out of, or shall be based upon, any untrue
statement or alleged untrue statement of a material fact contained in the
registration statement on the effective date thereof (including any prospectus
filed under Rule 424 of the Securities Act) or any amendment thereof or
supplement thereto, or in any document incorporated by reference therein, or any
omission or alleged omission to state therein a material fact required to be
stated therein or necessary to make the statements therein not misleading;
PROVIDED, HOWEVER, that the Company shall not be liable to the Selling Holders
in any such case to the extent that any such loss, claim, damage, expense,
judgment or liability arises out of, or is based upon, any untrue statement or
alleged untrue statement, or any omission, if such statement or omission shall
have been made in reliance upon and in conformity with information relating to
the Selling Holder(s) furnished to the Company in writing by or on behalf of any
Selling Holder specifically for use in the preparation of the registration
statement (including any prospectus filed under Rule 424 of the Securities Act)
or any amendment thereof or supplement thereto. Such indemnity shall remain in
full force and effect regardless of any investigation made by or on behalf of a
Selling Holder and shall survive the transfer of such securities. The foregoing
indemnity agreement is in addition to any liability which the Company may
otherwise have to each Selling Holder, its officers and directors, underwriters
of the Registrable Securities or any controlling person of the foregoing.
(b) In the case of any registration of any Registrable Securities
under the Securities Act pursuant to Sections 2 and 3 of this Agreement, each
Selling Holder agrees to indemnify and hold harmless the Company, its officers
and directors and each person, if any, who controls any of the foregoing within
the meaning of the Securities Act (and if requested by the underwriters, each
underwriter who participates in the offering and each person, if any, who
controls any such underwriter within the meaning of the Securities Act), from
and against any and all losses, claims, damages, expenses, judgments or
liabilities, joint or several, to which they or any of them may become subject
under the Securities Act or otherwise, including any amount paid in settlement
of any litigation commenced or threatened, and shall promptly reimburse them, as
and when incurred, for any legal or other expenses incurred by them in
connection with investigating any claims and defending any actions, insofar as
any such losses, claims, damages, expenses, judgments or liabilities shall arise
out of, or shall be based upon, any untrue statement or alleged untrue statement
of a material fact relating to such Selling Holder contained in the registration
statement on the effective date thereof (including any prospectus filed under
Rule 424 of the Securities Act) or any amendment thereof or supplement thereto,
or any omission or alleged omission to state therein a material fact relating to
such Selling Holder required to be stated therein or necessary to make the
statements therein not
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misleading, but in each case only to the extent that such untrue statement or
alleged untrue statement or omission or alleged omission relating to such
Selling Holder was made in reliance upon information relating to such Selling
Holder furnished to the Company in writing by or on behalf of such Selling
Holder specifically for use in the preparation of such registration statement
(including any prospectus filed under Rule 424 of the Securities Act); PROVIDED,
HOWEVER, that in no event shall any Selling Holder be liable for any amount in
excess of the net proceeds received from the sale of the Registrable Securities
by such Selling Holder in the subject offering. The foregoing indemnity is in
addition to any liability which any Selling Holder may otherwise have to the
Company, or any of its directors, offices or controlling persons.
(c) PROCEDURE FOR INDEMNIFICATION. Each party indemnified under
paragraph (a) or (b) of this Section 7 shall, promptly after receipt of notice
of any claim or the commencement of any action against such indemnified party in
respect of which indemnity may be sought, notify the indemnifying party in
writing of the claim or the commencement thereof; PROVIDED that the failure to
notify the indemnifying party shall not relieve it from any liability which it
may have to an indemnified party on account of the indemnity agreement contained
in paragraph (a) or (b) of this Section 7, except to the extent the indemnifying
party was prejudiced by such failure, and in no event shall relieve the
indemnifying party from any other liability which it may have to such
indemnified party. If any such claim or action shall be brought against an
indemnified party, and it shall notify the indemnifying party thereof, the
indemnifying party shall be entitled to participate therein, and, to the extent
that it wishes, jointly with any other similarly notified indemnifying party, to
assume the defense thereof with counsel reasonably satisfactory to the
indemnified party. After notice from the indemnifying party to the indemnified
party of its election to assume the defense of such claim or action, the
indemnifying party shall not be liable to the indemnified party under this
Section 7 for any legal or other expenses subsequently incurred by the
indemnified party in connection with the defense thereof other than reasonable
costs of investigation; PROVIDED that each indemnified party, its officers and
directors, if any, and each person, if any, who controls such indemnified party
within the meaning of the Securities Act, shall have the right to employ
separate counsel reasonably approved by the indemnifying party to represent them
if the named parties to any action (including any impleaded parties) include
both such indemnified party and an indemnifying party or an affiliate of an
indemnifying party, and such indemnified party shall have been advised by
counsel either (i) that there may be one or more legal defenses available to
such indemnified party that are different from or additional to those available
to such indemnifying party or such affiliate or (ii) a conflict may exist
between such indemnified party and such indemnifying party or such affiliate,
and in that event the fees and expenses of one such separate counsel for all
such indemnified parties shall be paid by the indemnifying party. An indemnified
party will not enter into any settlement agreement which is not approved by the
indemnifying party, such approval not to be unreasonably withheld. The
indemnifying party may not agree to any settlement of any such claim or action
which provides for any remedy or relief other than monetary damages for which
the indemnifying party shall be responsible hereunder, without the prior written
consent of the indemnified party, which consent shall not be unreasonably
withheld. In any action hereunder as to which the indemnifying party has assumed
the defense thereof with counsel reasonably satisfactory to the indemnified
party, the indemnified party shall continue to be entitled to participate in the
defense thereof, with counsel of its own choice, but, except as set forth above,
the indemnifying party shall not be obligated hereunder to reimburse the
indemnified party for the costs
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thereof. In all instances, the indemnified party shall cooperate fully with the
indemnifying party or its counsel in the defense of each claim or action.
If the indemnification provided for in this Section 7 shall for any
reason be unavailable to an indemnified party in respect of any loss, claim,
damage, expense, judgment or liability, or any action in respect thereof,
referred to herein, then each indemnifying party shall, in lieu of indemnifying
such indemnified party, contribute to the amount paid or payable by such
indemnified party as a result of such loss, claim, damage, expense, judgment or
liability in respect thereof, or action in respect thereof, in such proportion
as shall be appropriate to reflect the relative fault of the indemnifying party
on the one hand and the indemnified party on the other with respect to the
statements or omissions which resulted in such loss, claim, damage, expense,
judgment or liability, or action in respect thereof, as well as any other
relevant equitable considerations. The relative fault shall be determined by
reference to whether the untrue or alleged untrue statement of a material fact
or omission or alleged omission to state a material fact relates to information
supplied by the indemnifying party on the one hand or the indemnified party on
the other, the intent of the parties and their relative knowledge, access to
information and opportunity to correct or prevent such statement or omission,
but not by reference to any indemnified party's stock ownership in the Company.
In no event, however, shall a Selling Holder be required to contribute in excess
of the amount of the net proceeds received by such Selling Holder in connection
with the sale of Registrable Securities in the offering which is the subject of
such loss, claim, damage or liability. The amount paid or payable by an
indemnified party as a result of the loss, claim, damage, expense, judgment or
liability, or action in respect thereof, referred to above in this paragraph
shall be deemed to include, for purposes of this paragraph, any legal or other
expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action or claims. 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.
8. RULE 144. The Company shall take such measures and file such
information, documents and reports to be filed by it under the Securities Act
and the Exchange Act and the rules and regulations adopted by the SEC thereunder
and will take such further action as any Holder of Registrable Securities may
reasonably request, all to the extent necessary or desirable from time to time
to enable such Holder to sell Registrable Securities without registration under
the Securities Act within the limitation of the exemptions provided by Rule 144.
Upon the request of any Holder of Registrable Securities, the Company will
deliver to such Holder a written statement, certified by an authorized executive
officer of the Company, as to whether the Company has complied with such
requirements. The Company shall have no obligation to effect a registration of
Registrable Securities pursuant to Section 2 or Section 3 hereof if such
Registrable Securities may be sold without registration under the Securities Act
within the limitation of the exemption provided by Rule 144(k).
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9. HOLDBACK. Each of the Company and the Selling Holders agrees, if so
required by the managing underwriter, not to sell, make any short sale of, loan,
grant any option for the purchase of (other than pursuant to employee benefit
plans), effect any public sale or distribution of or otherwise dispose of the
Company's equity securities or securities convertible into or exchangeable or
exercisable for any such securities during the 30 days prior to and the 90 days
after any underwritten registration pursuant to Section 2 or 3 hereof has become
effective, except as part of such underwritten registration and except, in the
case of the Company, pursuant to registrations on Form S-4 or S-8 or any
successor form thereto.
10. TRANSFER OF REGISTRATION RIGHTS.
(a) A Holder may transfer all or any portion of its rights under this
Agreement only to a Permitted Transferee. The Holder making such transfer shall
promptly notify the Company in writing stating the name and address of any
Permitted Transferee and identifying the amount of Registrable Securities with
respect to which the rights under this Agreement are being transferred and the
nature of the rights so transferred. In connection with any such transfer, the
term "Holder" as used in this Agreement shall, where appropriate to assign the
rights and obligations of a Holder hereunder to such Permitted Transferee, be
deemed to refer to the Permitted Transferee, as holder of such Registrable
Securities.
(b) After any such transfer, the Holder making such transfer shall
retain its rights under this Agreement with respect to all other Registrable
Securities still owned by such Holder.
(c) Upon the request of the Holder making such transfer, the Company
shall execute a Registration Rights Agreement with such Permitted Transferee or
a proposed Permitted Transferee substantially similar to this Agreement.
11. MISCELLANEOUS.
(a) INJUNCTIONS. Each party acknowledges and agrees that irreparable
damage would occur in the event that any of the provisions of this Agreement was
not performed in accordance with its specific terms or was otherwise breached.
Therefore, each party shall be entitled to seek an injunction or injunctions to
prevent breaches of the provisions of this Agreement and to enforce specifically
the terms and provisions hereof in any court having jurisdiction, such remedy
being in addition to any other remedy to which such party may be entitled at law
or in equity.
(b) SEVERABILITY. If any term or provision of this Agreement shall be
held by a court of competent jurisdiction to be invalid, void or unenforceable,
the remainder of the terms and provisions set forth herein shall remain in full
force and effect and shall in no way be affected, impaired or invalidated, and
each of the parties shall use its Best Efforts to find and employ an alternative
means to achieve the same or substantially the same result as that contemplated
by such term or provision.
(c) FURTHER ASSURANCES. Subject to the specific terms of this
Agreement, each of the parties hereto shall make, execute, acknowledge and
deliver such other instruments and documents, and take all such other actions,
as may be reasonably
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required in order to effectuate the purposes of this Agreement and to consummate
the transactions contemplated hereby.
(d) WAIVERS, ETC. No failure or delay on the part of either party (or
the intended third-party beneficiaries referred to herein) in exercising any
power or right hereunder shall operate as a waiver thereof, nor shall any single
or partial exercise of any such right or power, or any abandonment or
discontinuance of steps to enforce such a right or power preclude any other or
further exercise thereof or the exercise of any other right or power. No
modification or waiver of any provision of this Agreement nor consent to any
departure therefrom shall in any event be effective unless the same shall be in
writing and signed by an authorized officer of each of the parties, and then
such waiver or consent shall be effective only in the specific instance and for
the purpose for which given.
(e) ENTIRE AGREEMENT. This Agreement contains the entire understanding
of the parties with respect to its subject matter. This Agreement supersedes all
prior agreements and understandings between the parties, whether written or
oral, with respect to the subject matter hereof. The paragraph headings
contained in this Agreement are for reference purposes only, and shall not
affect in any manner the meaning or interpretation of this Agreement.
(f) COUNTERPARTS. For the convenience of the parties, this Agreement
may be executed in any number of counterparts, each of which shall be deemed to
be an original but all of which together shall be one and the same instrument.
(g) AMENDMENT. This Agreement may be amended only by a written
instrument duly executed by an authorized officer of the Company and an
authorized officer of each Holder.
(h) NOTICES. All notices, requests, claims, demands and other
communications under this Agreement shall be in writing and shall be deemed
given when received if delivered personally, on the next business day if sent by
overnight courier for next business day delivery (providing proof of delivery),
when confirmation is received, if sent by facsimile or in five business days if
sent by U.S. registered or certified mail, postage prepaid (return receipt
requested) to the other parties at the following addresses (or at such other
address for a party as shall be specified by like notice):
(i) if to the Company, to:
White Mountains Insurance Group, Ltd.
▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: Corporate Secretary
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
(ii) if to the Purchasers, at the address set forth below each
Purchaser's name on the signature pages hereto.
(i) GOVERNING LAW. This Agreement shall be governed by, and construed
in accordance with, the laws of the State of New York regardless of the laws
that might otherwise govern under applicable principles of conflicts of laws
thereof.
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(j) TERM. This Agreement shall remain in full force and effect until
there are no Registrable Securities outstanding or until terminated by the
mutual agreement of the parties hereto.
(k) ASSIGNMENT. Except as provided herein, the parties may not assign
their rights under this Agreement. This Agreement shall be binding upon and
inure to the benefit of successors to the parties hereto.
(l) PRIORITY OF RIGHTS. The Purchasers agree that the rights granted
hereunder are expressly made subject to the rights of the "Holders" under the
Registration Rights Agreement dated as of May 30, 2001 between the Company and
Berkshire Hathaway Inc. in a manner consistent with such agreement.
- 15 -
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their authorized representative as of the date first above
written.
WHITE MOUNTAINS INSURANCE GROUP, LTD.
by:
--------------------------
Name: ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Title: Corporate Secretary
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MUTUAL SHARES FUND
MUTUAL QUALIFIED FUND
MUTUAL BEACON FUND
MUTUAL DISCOVERY FUND
MUTUAL EUROPEAN FUND
MUTUAL FINANCIAL SERVICES FUND
FRANKLIN MUTUAL BEACON FUND
FRANKLIN MUTUAL BEACON FUND (JAPAN)
FRANKLIN MUTUAL EUROPEAN FUND
MUTUAL BEACON FUND (CANADA)
MUTUAL SHARES SECURITIES FUND
MUTUAL DISCOVERY SECURITIES FUND
MUTUAL SHARES II FUND
BY: FRANKLIN MUTUAL ADVISERS, LLC
Address: Franklin Mutual Advisers, LLC
▇▇ ▇▇▇▇ ▇. ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
by:
------------------------------
Name: ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Title: Vice President
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