-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, Ro5GrQM2NlQCi42Nxy7969XJoP1z2yz/ODbvYV8IGIjdfbjxsE3L+oEw4DS6+8Sk ZQHfVMPGu1tG/YVQt1AkYQ== 0000950123-06-006843.txt : 20060523 0000950123-06-006843.hdr.sgml : 20060523 20060523170718 ACCESSION NUMBER: 0000950123-06-006843 CONFORMED SUBMISSION TYPE: 8-K PUBLIC DOCUMENT COUNT: 3 CONFORMED PERIOD OF REPORT: 20060518 ITEM INFORMATION: Entry into a Material Definitive Agreement ITEM INFORMATION: Financial Statements and Exhibits FILED AS OF DATE: 20060523 DATE AS OF CHANGE: 20060523 FILER: COMPANY DATA: COMPANY CONFORMED NAME: ALLEGHANY CORP /DE CENTRAL INDEX KEY: 0000775368 STANDARD INDUSTRIAL CLASSIFICATION: FIRE, MARINE & CASUALTY INSURANCE [6331] IRS NUMBER: 510283071 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 8-K SEC ACT: 1934 Act SEC FILE NUMBER: 001-09371 FILM NUMBER: 06862066 BUSINESS ADDRESS: STREET 1: 375 PARK AVENUE STREET 2: SUITE 3201 CITY: NEW YORK STATE: NY ZIP: 10152 BUSINESS PHONE: 2127521356 MAIL ADDRESS: STREET 1: 375 PARK AVENUE STREET 2: SUITE 3201 CITY: NEW YORK STATE: NY ZIP: 10152 FORMER COMPANY: FORMER CONFORMED NAME: ALLEGHANY FINANCIAL CORP DATE OF NAME CHANGE: 19870115 8-K 1 y21663e8vk.htm FORM 8-K FORM 8-K
 

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 OR 15(d) of The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): May 18, 2006
Alleghany Corporation
 
(Exact name of registrant as specified in its charter)
         
Delaware   1-9371   51-0283071
(State or other jurisdiction
of incorporation)
  (Commission File Number)   (IRS Employer
Identification No.)
         
7 Times Square Tower, 17th Floor, New York, New York   10036
(Address of principal executive offices)   (Zip Code)
Registrant’s telephone number, including area code: (212) 752-1356
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

¨ Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

¨ Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

¨ Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

¨ Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))


 

Item 1.01 Entry into a Material Definitive Agreement.
On May 18, 2006, in connection with the initial public offering of shares of common stock (the “IPO”) of Darwin Professional Underwriters, Inc. (“Darwin”), a subsidiary of Alleghany Corporation (the “Company”), Alleghany Insurance Holdings LLC, also a subsidiary of the Company, and Darwin entered into a Registration Rights Agreement (the “Registration Rights Agreement”). The Registration Rights Agreement is filed as Exhibit 10.1 to this current report on Form 8-K.
Also on May 18, 2006, in connection with the IPO, the Company entered into a Master Agreement (the “Master Agreement”) with Darwin. The Master Agreement is filed as Exhibit 10.2 to this current report on Form 8-K.
Item 9.01 Financial Statements and Exhibits.
(c) Exhibits
       
  10.1   Registration Rights Agreement dated as of May 18, 2006 by and between Darwin Professional Underwriters, Inc. and Alleghany Insurance Holdings LLC.
 
  10.2   Master Agreement dated as of May 18, 2006 by and between Darwin Professional Underwriters, Inc. and Alleghany Corporation.

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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
         
  ALLEGHANY CORPORATION  
 
Date: May 23, 2006 By: /s/  Jerry G. Borrelli  
    Name: Jerry G. Borrelli  
    Title: Vice President  

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EX-10.1 2 y21663exv10w1.txt EX-10.1: REGISTRATION RIGHTS AGREEMENT Exhibit 10.1 Execution Copy REGISTRATION RIGHTS AGREEMENT by and between DARWIN PROFESSIONAL UNDERWRITERS, INC. and ALLEGHANY INSURANCE HOLDINGS LLC Dated as of May 18, 2006 REGISTRATION RIGHTS AGREEMENT This REGISTRATION RIGHTS AGREEMENT (the "Agreement") is made and entered into as of May 18, 2006, by and between Alleghany Insurance Holdings LLC, a Delaware limited liability company ("AIHL"), and Darwin Professional Underwriters, Inc., a Delaware corporation and a majority owned subsidiary of AIHL (the "Company"). Certain capitalized terms used herein are defined in Section 1 of this Agreement. WHEREAS, as of the date hereof, AIHL owns approximately 90% of the issued and outstanding voting securities of the Company and the management of the Company, through a restricted share program, holds the balance of the issued and outstanding voting securities of the Company; and WHEREAS, the Company has previously filed the IPO Registration Statement (as herein defined) with the Securities and Exchange Commission but it has not yet become effective; and WHEREAS, immediately following the consummation of the IPO (as herein defined), AIHL will continue to own more than 50% of the outstanding voting securities of the Company; and WHEREAS, the Company has agreed to provide the registration rights specified in this Agreement, on the terms and subject to the conditions set forth herein. NOW, THEREFORE, in consideration of the mutual covenants and agreements hereinafter contained and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows: 1. Certain Definitions. As used in this Agreement, the following terms shall have the meanings ascribed to them below: "Affiliate" means (i) with respect to any Person, any other Person directly or indirectly controlling or controlled by or under direct or indirect common control with such specified Person or (ii) with respect to any individual, shall also mean the spouse or child of such individual; provided, however, that neither the Company nor any Person controlled by the Company shall be deemed to be an Affiliate of any Holder. "Business Day" means any day other than a Saturday, a Sunday, or a day on which banking institutions located in the State of New York are authorized or obligated by law or executive order to close. "Common Stock" means the shares of Common Stock of the Company and any equity securities issued or issuable with respect to the Common Stock in connection with a reclassification, recapitalization, merger, consolidation or other reorganization. 2 "Common Stock Equivalents" means any securities convertible into, or exercisable or exchangeable for, shares of Common Stock. "Exchange Act" means the Securities Exchange Act of 1934, as amended. "Holder" or "Holders" means AIHL and, subject to Section 4.5(a), any party who shall hereafter acquire and hold Registrable Securities. "IPO" means the initial public offering of shares of Common Stock as contemplated by the IPO Registration Statement. "IPO Registration Statement" means the Company's Registration Statement on Form S-1, Registration No. 333-132355, of the Company, as supplemented and amended from time to time. "Major Holder" means, with respect to any registration statement, the Holder that, together with its Affiliates, includes the largest number of Registrable Securities covered by that registration statement. "Person" means any individual, corporation, limited liability company, limited or general partnership, joint venture, association, joint-stock company, trust, unincorporated organization or government or any agency or political subdivisions thereof. "Registrable Securities" means any (a) shares of Common Stock held by AIHL and (b) shares of Common Stock issued or issuable, directly or indirectly, with respect to the Common Stock referenced in clause (a) above by way of stock dividend, stock split or combination of shares. "SEC" means the Securities and Exchange Commission. "Securities Act" means the Securities Act of 1933, as amended. 2. Registration Rights. 2.1. Demand Registrations. (a) Subject to the terms and conditions of this Agreement, at any time and from time to time after the date hereof, the Holders shall have the right to require the Company to file a registration statement under the Securities Act covering all or any part of their Registrable Securities on six (6) separate occasions in the aggregate, by delivering a written request therefor to the Company specifying the number of Registrable Securities to be included in such registration and the intended method of distribution thereof (including, but not limited to, an underwritten offering). All such requests pursuant to this Section 2.1(a) are referred to herein as "Demand Registration Requests," and the registrations so requested are referred to herein as "Demand Registrations" (with respect to any Demand Registration, the Holder making such demand for registration being referred to as the "Initiating Holder"). As promptly as practicable, but no later than ten days after receipt of a Demand Registration Request, the 3 Company shall give written notice (the "Demand Exercise Notice") of such Demand Registration Request to all other Holders of record of Registrable Securities. (b) The Company, subject to Sections 2.3 and 2.6, shall include in a Demand Registration (x) the Registrable Securities of the Initiating Holder and (y) the Registrable Securities of any other Holder which shall have made a written request to the Company for inclusion in such registration (which request shall specify the maximum number of Registrable Securities intended to be disposed of by such Holder) within 10 days after the receipt of the Demand Exercise Notice. (c) The Company shall, as expeditiously as possible, use its reasonable best efforts to (x) effect such registration under the Securities Act (including, without limitation, by means of a shelf registration pursuant to Rule 415 under the Securities Act if so requested and if the Company is then eligible to use a shelf registration) of the Registrable Securities which the Company has been so requested to register, for distribution in accordance with such intended method of distribution, and (y) if requested by AIHL, if AIHL is participating in such registration, or if requested by the Initiating Holder, if AIHL is not participating in such registration, obtain acceleration of the effective date of the registration statement relating to such registration. (d) The Demand Registration rights granted in Section 2.1(a) to the Holders are subject to the following limitations: (i) with respect to any registration in respect of a Demand Registration Request initiated by a transferee of AIHL, such registration statement must include shares of Common Stock representing in excess of 20% of the Registrable Securities then outstanding; (ii) the Company shall not be required to cause a registration pursuant to Section 2.1(a) to be declared effective within a period of 180 days after the effective date of any registration statement of the Company effected in connection with a Demand Registration Request; and (iii) if the Board of Directors of the Company, in its good faith judgment, determines that any registration of Registrable Securities should not be made or continued because it would either (A) require under applicable law disclosure of material non-public information regarding confidential business activities of the Company and such disclosure at that time would be materially detrimental to the Company and its stockholders or (B) materially interfere with any material financing, acquisition, corporate reorganization or merger or other transaction involving the Company or any of its subsidiaries (each, a "Valid Business Reason"), the Company may postpone filing a registration statement relating to a Demand Registration Request, or may cause such registration statement to be withdrawn and its effectiveness terminated or may postpone amending or supplementing such registration statement until such Valid Business Reason no longer exists, but in no event for more than three months (such period of postponement or withdrawal, the "Postponement Period"); and the Company shall give written notice of its determination to postpone or withdraw a registration statement and of the fact that the Valid Business Reason for such postponement or withdrawal no longer exists, in each case, promptly after the occurrence thereof; provided, however, that the Company shall not be permitted to postpone or withdraw a registration statement after the expiration of any Postponement Period until six months after the expiration of such Postponement Period without the prior written approval of AIHL. 4 (e) If the Company shall give any notice of postponement or withdrawal of any registration statement, the Company shall not, during the period of postponement or withdrawal, register any Common Stock, other than pursuant to a registration statement on Form S-4 or S-8 (or an equivalent registration form then in effect). Each Holder of Registrable Securities agrees that, upon receipt of any notice from the Company that the Company has determined to withdraw any registration statement pursuant to clause (iii) above, such Holder will discontinue its disposition of Registrable Securities pursuant to such registration statement and, if so directed by the Company, will deliver to the Company (at the Company's expense) all copies, other than permanent file copies, then in such Holder's possession of the prospectus covering such Registrable Securities that was in effect at the time of receipt of such notice. If the Company shall have withdrawn or prematurely terminated a registration statement filed under Section 2.1(a) (whether pursuant to Section 2.1(d)(iii) or as a result of any stop order, injunction or other order or requirement of the SEC or any other governmental agency or court), the Company shall not be considered to have effected an effective registration for the purposes of this Agreement (including, without limitation, for purposes of Section 2.1(c) above) until the Company shall have filed a new registration statement covering the Registrable Securities covered by the withdrawn registration statement and such registration statement shall have been declared effective and shall not have been withdrawn. If the Company shall give any notice of withdrawal or postponement of a registration statement, the Company shall, at such time as the Valid Business Reason that caused such withdrawal or postponement no longer exists (but in no event later than three months after the date of the postponement or withdrawal), use its reasonable best efforts to effect the registration under the Securities Act of the Registrable Securities covered by the withdrawn or postponed registration statement in accordance with this Section 2.1 (unless the Initiating Holder shall have withdrawn such request, in which case the Company shall not be considered to have effected an effective registration for the purposes of this Agreement, including, without limitation, for purposes of Section 2.1(c) above). (f) The Company, subject to Sections 2.3 and 2.6, may elect to include in any registration statement and offering made pursuant to Section 2.1(a), (i) authorized but unissued shares of Common Stock or shares of Common Stock held by the Company as treasury shares and (ii) any other shares of Common Stock which are requested to be included in such registration pursuant to the exercise of piggyback rights granted by the Company after the date hereof which are not inconsistent with the rights granted in, or otherwise in conflict with the terms of, this Agreement ("Additional Piggyback Rights") provided, however, that such inclusion shall be permitted only to the extent that it is pursuant to and subject to the terms of the underwriting agreement or arrangements, if any, entered into by the Initiating Holder. (g) In connection with any Demand Registration that is an underwritten offering, if AIHL is participating in such Demand Registration, then AIHL shall have the right to designate the lead managing underwriter and each other managing underwriter for such registration; provided that the lead managing underwriter and each such other managing underwriter is reasonably satisfactory to the Company, it being understood and agreed that either of Merrill Lynch & Co. or Credit Suisse shall be deemed to be satisfactory to the Company. If AIHL is not participating in the Demand Registration, then the Company shall have the right to designate the lead managing underwriter for 5 such registration, provided that such lead managing underwriter shall be reasonably satisfactory to the Initiating Holder, and the Initiating Holder shall have the right to designate one managing underwriter other than the lead managing underwriter in any such registration, provided that such managing underwriter selected by the Initiating Holder is reasonably satisfactory to the Company, it being understood and agreed that either of Merrill Lynch & Co. or Credit Suisse shall be deemed to be satisfactory both to the Company and to the Initiating Holder. 2.2. Piggyback Registrations. (a) If, at any time, the Company proposes or is required to register any of its equity securities under the Securities Act (other than pursuant to (i) a registration statement on Form S-4 or S-8 (or an equivalent registration form then in effect) or (ii) a Demand Registration under Section 2.1) on a registration statement on Form S-1 or Form S-3 (or an equivalent general registration form then in effect), whether or not for its own account, the Company shall give prompt written notice of its intention to do so to each of the Holders of record of Registrable Securities. Upon the written request (the "Piggyback Request") of any such Holder, made within 10 days following the receipt of any such written notice (which request shall specify the maximum number of Registrable Securities intended to be disposed of by such Holder and the intended method of distribution thereof), the Company shall, subject to Sections 2.2(b), 2.3 and 2.6 hereof, use its reasonable best efforts to cause all Registrable Securities covered by Piggyback Requests to be registered under the Securities Act (with the securities which the Company at the time proposes to register) to permit the sale or other disposition by the Holders (in accordance with the intended method of distribution thereof) of the Registrable Securities to be so registered. There is no limitation on the number of such piggyback registrations pursuant to the preceding sentence which the Company is obligated to effect. No registration effected under this Section 2.2(a) shall relieve the Company of its obligations to effect Demand Registrations. (b) If, at any time after giving written notice of its intention to register any equity 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 or to delay registration of such equity securities, the Company may, at its election, give written notice of such determination to all Holders of record of Registrable Securities who made timely Piggyback Requests and (i) in the case of a determination not to register, shall be relieved of its obligation to register any Registrable Securities in connection with such abandoned registration, without prejudice, however, to the rights of Holders under Section 2.1, and (ii) in the case of a determination to delay such registration of its equity securities, shall be permitted to delay the registration of such Registrable Securities for the same period as the delay in registering such other equity securities. (c) Any Holder shall have the right to withdraw its Piggyback Request by giving written notice to the Company of its request to withdraw; provided, however, that (i) such request must be made in writing prior to the earlier of the execution of the underwriting agreement or the execution of the custody agreement with respect to such registration and (ii) such withdrawal shall be irrevocable and, after making such 6 withdrawal, a Holder shall no longer have any right to include Registrable Securities in the registration as to which such withdrawal was made. 2.3. Allocation of Securities Included in Registration Statement. (a) If any requested registration pursuant to Section 2.1 involves an underwritten offering and the lead managing underwriter of such offering (the "Manager") shall advise the Company that, in its view, the number of securities requested to be included in such registration by the Holders or any other persons (including those shares of Common Stock requested by the Company to be included in such registration) exceeds the largest number (the "Section 2.1 Sale Number") that can be sold in an orderly manner in such offering within a price range acceptable to the Initiating Holder, the Company shall include in such registration: (i) all Registrable Securities requested in such registration by Holders of Registrable Securities; provided, however, that if the number of such Registrable Securities exceeds the Section 2.1 Sale Number, then the number of such Registrable Securities (not to exceed the Section 2.1 Sale Number) to be included in such registration shall be allocated on a pro rata basis among all Holders requesting that Registrable Securities be included in such registration, based on the number of Registrable Securities then owned by each Holder requesting inclusion in relation to the number of Registrable Securities owned by all Holders requesting inclusion; (ii) to the extent that the number of Registrable Securities to be included by all Holders pursuant to clause (i) of this Section 2.3(a) is less than the Section 2.1 Sale Number, securities that the Company proposes to register (up to the Section 2.1 Sale Number); and (iii) to the extent that the number of Registrable Securities to be included by all Holders and the number of securities to be included by the Company is less than the Section 2.1 Sale Number, any other securities that the holders thereof propose to register pursuant to the exercise of Additional Piggyback Rights (up to the Section 2.1 Sale Number); provided that if the number of securities requested to be registered pursuant to the exercise of Additional Piggyback Rights exceeds the amount that may be registered, the number of securities to be included shall be allocated in the manner provided by the terms of the agreements providing for the Additional Piggyback Rights. If, as a result of the proration provisions of this Section 2.3(a), any Holder shall not be entitled to include all Registrable Securities in a registration that such Holder has requested be included, such Holder may elect to withdraw his request to include Registrable Securities in such registration or may reduce the number requested to be included; provided, however, that (x) such request must be made in writing prior to the earlier of the execution of the underwriting agreement or the execution of the custody agreement with respect to such registration and (y) such withdrawal shall be irrevocable and, after making such withdrawal, a Holder shall no longer have any right to include Registrable Securities in the registration as to which such withdrawal was made. 7 (b) If any registration pursuant to Section 2.2 involves an underwritten offering and the Manager shall advise the Company that, in its view, the number of securities requested to be included in such registration exceeds the number (the "Section 2.2 Sale Number") that can be sold in an orderly manner in such registration within a price range acceptable to the Company, the Company shall include in such registration: (i) all Common Stock or securities convertible into, or exchangeable or exercisable for, Common Stock that the Company proposes to register for its own account (the "Company Securities"); (ii) to the extent that the number of Company Securities is less than the Section 2.2 Sale Number, the remaining shares to be included in such registration (up to the Section 2.2 Sale Number) shall be allocated on a pro rata basis among all Holders timely making a Piggyback Request, based on the number of Registrable Securities then owned by each Holder requesting inclusion in relation to the number of Registrable Securities owned by all Holders requesting inclusion; and (iii) to the extent the number of Company Securities plus the number of Registrable Securities requested to be included by all Holders is less than the Section 2.2 Sale Number, any other securities that the holders thereof propose to register pursuant to the exercise of Additional Piggyback Rights granted to them by the Company pursuant to separate registration rights agreements after the date hereof (up to the Section 2.2 Sale Number); provided that if the number of securities requested to be registered pursuant to the exercise of Additional Piggyback Rights exceeds the amount that may be registered, the number of securities to be included shall be allocated in the manner provided by the terms of the agreements providing for the Additional Piggyback Rights. 2.4. Registration Procedures. If and whenever the Company is required by the provisions of this Agreement to use its reasonable best efforts to effect or cause the registration of any Registrable Securities under the Securities Act as provided in this Agreement, the Company shall, as expeditiously as possible: (a) prepare and file with the SEC a registration statement on an appropriate registration form of the SEC for the disposition of such Registrable Securities in accordance with the intended method of disposition thereof, which form (i) shall be selected by the Company and (ii) shall, in the case of a shelf registration, be available for the sale of the Registrable Securities by the selling Holders thereof and such registration statement shall comply as to form in all material respects with the requirements of the applicable form and include all financial statements required by the SEC to be filed therewith, and the Company shall use its reasonable best efforts to cause such registration statement to become and remain effective for the time period specified below; provided, however, that before filing a registration statement or prospectus or any amendments or supplements thereto, or comparable statements under securities or blue sky laws of any jurisdiction, the Company will furnish to one counsel for the Holders participating in the planned registration (selected by AIHL, if AIHL is participating in such registration, or, if AIHL is not participating in such registration, selected by the Initiating Holder in the case of a registration pursuant to Section 2.1, or selected by the Major Holder, in the case of a registration pursuant to Section 2.2) and the underwriters, if any, copies of all such 8 documents proposed to be filed (including all exhibits thereto), which documents will be subject to the reasonable review and reasonable comment of such counsel and the underwriters, and the Company shall not file any registration statement or amendment thereto or any prospectus or supplement thereto to which the Holders of a majority of the Registrable Securities covered by such registration statement or the underwriters, if any, shall reasonably object in writing; (b) 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 keep such registration statement effective for such period (which shall not be required to exceed 180 days in the case of a registration pursuant to Section 2.1 or 120 days in the case of a registration pursuant to Section 2.2) as any seller of Registrable Securities pursuant to such registration statement shall request and to comply with the provisions of the Securities Act with respect to the sale or other disposition of all Registrable Securities covered by such registration statement in accordance with the intended methods of disposition by the seller or sellers thereof set forth in such registration statement; (c) furnish, without charge, to each seller of such Registrable Securities and each underwriter, if any, of the securities covered by such registration statement such number of copies of such registration statement, each amendment and supplement thereto (in each case including all exhibits), and the prospectus included in such registration statement (including each preliminary prospectus) in conformity with the requirements of the Securities Act, and other documents, as such seller and underwriter may reasonably request in order to facilitate the public sale or other disposition of the Registrable Securities owned by such seller (the Company hereby consenting to the use in accordance with all applicable law of each such registration statement (or amendment or post-effective amendment thereto) and each such prospectus (or preliminary prospectus or supplement thereto) by each such seller of Registrable Securities and the underwriters, if any, in connection with the offering and sale of the Registrable Securities covered by such registration statement or prospectus); (d) use its reasonable best efforts to register or qualify the Registrable Securities covered by such registration statement under such other securities or "blue sky" laws of such jurisdictions as any sellers of Registrable Securities or any managing underwriter, if any, shall reasonably request, and do any and all other acts and things which may be reasonably necessary or advisable to enable such sellers or underwriter, if any, to consummate the disposition of the Registrable Securities in such jurisdictions, except that in no event shall the Company be required to qualify to do business as a foreign corporation in any jurisdiction where it would not, but for the requirements of this paragraph (d), be required to be so qualified, to subject itself to taxation in any such jurisdiction or to consent to general service of process in any such jurisdiction; (e) promptly notify each Holder selling Registrable Securities covered by such registration statement and each managing underwriter, if any: (i) when the registration statement, any pre-effective amendment, the prospectus or any prospectus supplement related thereto or post-effective amendment to the registration statement has been filed and, with respect to the registration statement or any post-effective amendment, when the same has become effective; (ii) of any request by the SEC or state 9 securities authority for amendments or supplements to the registration statement or the prospectus related thereto or for additional information; (iii) of the issuance by the SEC of any stop order suspending the effectiveness of the registration statement or the initiation of any proceedings for that purpose; (iv) of the receipt by the Company of any notification with respect to the suspension of the qualification of any Registrable Securities for sale under the securities or blue sky laws of any jurisdiction or the initiation of any proceeding for such purpose; (v) of the existence of any fact of which the Company becomes aware which results in the registration statement, the prospectus related thereto or any document incorporated therein by reference containing an untrue statement of a material fact or omitting to state a material fact required to be stated therein or necessary to make any statement therein not misleading; and (vi) if at any time the representations and warranties contemplated by any underwriting agreement, securities sale agreement, or other similar agreement, relating to the offering shall cease to be true and correct in all material respects; and, if the notification relates to an event described in clause (v), the Company shall promptly prepare and furnish to each such seller and each underwriter, if any, a reasonable number of copies of a prospectus supplemented or amended so that, as thereafter delivered to the purchasers of such Registrable Securities, such prospectus shall not include an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein in the light of the circumstances under which they were made not misleading; (f) comply with all applicable rules and regulations of the SEC, and make generally available to its security holders, as soon as reasonably practicable after the effective date of the registration statement (and in any event within 17 months thereafter), an earnings statement (which need not be audited) covering the period of at least twelve consecutive months beginning with the first day of the Company's first calendar quarter after the effective date of the registration statement, which earnings statement shall satisfy the provisions of Section 11(a) of the Securities Act and Rule 158 thereunder; (g) cause all such Registrable Securities covered by such registration statement to be listed on the NYSE Arca exchange or such other securities exchange (including, for this purpose, the Nasdaq National Market) (the NYSE Arca exchange or such other securities exchange, the "Exchange") on which similar securities issued by the Company are then listed (if any), if the listing of such Registrable Securities is then permitted under the rules of such Exchange; (h) enter into such customary agreements (including, if applicable, an underwriting agreement) and take such other actions as AIHL, if AIHL is participating in such registration, or, if AIHL is not participating in such registration, as the Initiating Holder, in the case of a registration pursuant to Section 2.1, or as the Major Holder, in the case of a registration pursuant to Section 2.2, shall reasonably request in order to expedite or facilitate the disposition of such Registrable Securities. The Holders of the Registrable Securities which are to be distributed by such underwriters shall be parties to such underwriting agreement and may, at their option, require that the Company make to and for the benefit of such Holders the representations, warranties and covenants of the Company which are being made to and for the benefit of such underwriters and which are of the type customarily provided to institutional investors in secondary offerings; 10 (i) use its reasonable best efforts to obtain an opinion from the Company's counsel and a "cold comfort" letter from the Company's independent public accountants in customary form and covering such matters as are customarily covered by such opinions and "cold comfort" letters delivered to underwriters in underwritten public offerings, which opinion and letter shall be reasonably satisfactory to the underwriter, if any, and to AIHL, if AIHL is participating in such registration, or, if AIHL is not participating in such registration, to the Initiating Holder, in the case of a registration pursuant to Section 2.1, or to the Major Holder, in the case of a registration pursuant to Section 2.2, and furnish to each Holder participating in the offering and to each underwriter, if any, a copy of such opinion and letter addressed to such Holder or underwriter; (j) deliver promptly to each Holder participating in the offering and each underwriter, if any, copies of all correspondence between the SEC and the Company, its counsel or auditors and all memoranda relating to discussions with the SEC or its staff with respect to the registration statement, other than those portions of any such memoranda which contain information subject to attorney-client privilege with respect to the Company, and, upon receipt of such confidentiality agreements as the Company may reasonably request, make reasonably available for inspection by any seller of such Registrable Securities covered by such registration statement, by any underwriter, if any, participating in any disposition to be effected pursuant to such registration statement and by any accountant or other agent retained by any such seller or any such underwriter, all pertinent financial and other records, pertinent corporate documents and properties of the Company, and cause all of the Company's officers, directors and employees to supply all information reasonably requested by any such seller, underwriter, accountant or agent in connection with such registration statement; (k) use its reasonable best efforts to obtain the withdrawal of any order suspending the effectiveness of the registration statement; (l) make reasonably available its employees and personnel and otherwise provide reasonable assistance to the underwriters (taking into account the needs of the Company's businesses and the requirements of the marketing process) in the marketing of Registrable Securities in any underwritten offering; (m) promptly prior to the filing of any document which is to be incorporated by reference into the registration statement or the prospectus (after the initial filing of such registration statement), provide copies of such document to counsel (selected pursuant to Section 2.4(a)) for the selling holders of Registrable Securities and to each managing underwriter, if any, and make the Company's representatives reasonably available for discussion of such document and make such changes in such document concerning the selling holders prior to the filing thereof as such counsel or underwriters may reasonably request; (n) furnish to AIHL, if AIHL is participating in such registration, or, if AIHL is not participating in such registration, to the Initiating Holder, in the case of a registration pursuant to Section 2.1, or to the Major Holder, in the case of a registration pursuant to Section 2.2, and the managing underwriter, without charge, at least one signed copy, and to each other Holder participating in the offering, without charge, at 11 least one photocopy of a signed copy, of the registration statement and any post-effective amendments thereto, including financial statements and schedules included therein; at the request of any Holder participating in the offering, to furnish to such Holder all documents incorporated therein by reference and all exhibits (including those incorporated by reference); (o) cooperate with the selling Holders of Registrable Securities and the managing underwriter, if any, to facilitate the timely preparation and delivery of certificates not bearing any restrictive legends representing the Registrable Securities to be sold, and cause such Registrable Securities to be issued in such denominations and registered in such names in accordance with the underwriting agreement prior to any sale of Registrable Securities to the underwriters or, if not an underwritten offering, in accordance with the instructions of the selling Holders of Registrable Securities at least three business days prior to any sale of Registrable Securities and instruct any transfer agent and registrar of Registrable Securities to release any stop transfer orders in respect thereof; (p) take all such other commercially reasonable actions as are necessary or advisable in order to expedite or facilitate the disposition of such Registrable Securities; and (q) take no direct or indirect action prohibited by Regulation M under the Exchange Act. The Company may require as a condition precedent to the Company's obligations under this Section 2.4 that each seller of Registrable Securities as to which any registration is being effected furnish the Company such information regarding such seller and the distribution of such securities as the Company may from time to time reasonably request provided that such information is necessary for the Company to consummate such registration and shall be used only in connection with such registration. Each Holder of Registrable Securities agrees that upon receipt of any notice from the Company of the happening of any event of the kind described in clause (v) of paragraph (e) of this Section 2.4, such Holder will discontinue such Holder's disposition of Registrable Securities pursuant to the registration statement covering such Registrable Securities until such Holder's receipt of the copies of the supplemented or amended prospectus contemplated by paragraph (e) of this Section 2.4 and, if so directed by the Company, will deliver to the Company (at the Company's expense) all copies, other than permanent file copies, then in such Holder's possession of the prospectus covering such Registrable Securities that was in effect at the time of receipt of such notice. In the event the Company shall give any such notice, the applicable period mentioned in paragraph (b) of this Section 2.4 shall be extended by the number of days during such period from and including the date of the giving of such notice to and including the date when each seller of any Registrable Securities covered by such registration statement shall have received the copies of the supplemented or amended prospectus contemplated by paragraph (e) of this Section 2.4. 12 2.5. Registration Expenses. (a) "Expenses" shall mean any and all fees and expenses incident to the Company's performance of or compliance with this Article 2, including, without limitation: (i) SEC and National Association of Securities Dealers, Inc. ("NASD") registration and filing fees, (ii) all listing fees and other fees with respect to the inclusion of securities on the Exchange, (iii) fees and expenses of compliance with state securities or "blue sky" laws and in connection with the preparation of a "blue sky" survey, including without limitation, reasonable fees and expenses of blue sky counsel, (iv) printing and copying expenses, (v) messenger and delivery expenses, (vi) expenses incurred in connection with any road show, (vii) fees and disbursements of counsel for the Company, (viii) with respect to each registration, the fees and disbursements of one counsel for the selling Holder(s) (selected by AIHL, if AIHL is participating in such registration, or, if AIHL is not participating in such registration, selected by the Initiating Holder in the case of a registration pursuant to Section 2.1, or selected by the Major Holder, in the case of a registration pursuant to Section 2.2), (ix) fees and disbursements of all independent public accountants (including the expenses of any audit and/or "cold comfort" letter) and fees and expenses of other persons, including special experts, retained by the Company, (x) fees and expenses payable to a Qualified Independent Underwriter (as such term is defined in Rule 2720 of the NASD) to the extent a Qualified Independent Underwriter is required and (xi) any other fees and disbursements of underwriters, if any, customarily paid by issuers or sellers of securities (collectively, "Expenses"). (b) The Company shall pay all Expenses with respect to any Demand Registration pursuant to Section 2.1 and any piggyback registrations pursuant to Section 2.2. For the avoidance of doubt, the Company shall, in the case of all registrations under this Article 2, be responsible for all of its internal expenses (including, without limitation, all salaries and expenses of its officers and employees performing legal or accounting duties). (c) Notwithstanding the foregoing, (x) the provisions of this Section 2.5 shall be deemed amended to the extent necessary to cause these expense provisions to comply with "blue sky" laws of each state in which the offering is made, (y) in connection with any registration hereunder, each Holder of Registrable Securities being registered shall pay all underwriting discounts and commissions attributable to the sale of the number of such Registrable Securities sold in the offering by such Holder and (z) the Company shall not be required to pay for the Expenses of any Demand Registration pursuant to Section 2.1 for which a registration proceeding has begun where the request for such Demand Registration is subsequently withdrawn by the Initiating Holder unless either (i) the withdrawal is based upon material adverse information concerning the Company of which the Initiating Holder was not aware at the time such Demand Registration was first requested or (ii) the Holders of a majority of Registrable Securities agree to forfeit their right to one Demand Registration (in which event such right to one Demand Registration shall be forfeited by all Holders of Registrable Securities). If the Holders are required to pay the Expenses incurred by the Company in connection with a Demand Registration that is subsequently withdrawn as described in clause (z) of the immediately preceding sentence, then such Expenses shall be allocated among the Holders of Registrable 13 Securities requesting inclusion of Registrable Securities in such Demand Registration in an amount proportionate to the total number of Registrable Securities for which registration was requested; if the Company is required to pay the Expenses of a withdrawn offering under the circumstances described in clause (z)(i) of the immediately preceding sentence, then the Holders shall not forfeit their right to a Demand Registration. 2.6. Certain Limitations on Registration Rights. In the case of any registration under Section 2.1 pursuant to an underwritten offering, or in the case of a registration under Section 2.2 if the Company has determined to enter into an underwriting agreement in connection therewith, all securities to be included in such registration shall be subject to an underwriting agreement and no person may participate in such registration unless such person agrees to sell such Person's securities on the basis provided therein and completes and executes all reasonable questionnaires, and other documents (including custody agreements and powers of attorney) which must be executed in connection therewith, and provides such other information to the Company or the underwriter as may be necessary to register such Person's securities. 2.7. Limitations on Sale or Distribution of Other Securities. (a) Each Holder of Registrable Securities agrees that, (i) to the extent requested in writing by a managing underwriter, if any, of any registration effected pursuant to Section 2.1 or 2.2, such Holder will agree not to sell, transfer or otherwise dispose of, including any sale pursuant to Rule 144 under the Securities Act, any Common Stock, or any other equity security of the Company or any security convertible into or exchangeable or exercisable for any equity security of the Company (other than as part of such underwritten public offering) during the time period reasonably requested by the managing underwriter, not to exceed 180 days (a "Lock-up"); provided, however, that the terms of the Lock-up shall be substantially similar to the terms of the lock-up agreement executed and delivered by AIHL in connection with the IPO; provided, further, that no Holder shall be required to be subject to a Lock-up unless the Company and its executive officers and directors are subject to a substantially similar provision (except that the Company may effect any sale or distribution of any such securities pursuant to a registration on Form S-4 (if reasonably acceptable to such managing underwriter) or Form S-8, or any successor or similar form which is then in effect or upon the conversion, exchange or exercise of any then outstanding Common Stock Equivalent). The Company agrees to use its reasonable best efforts to cause each holder of any equity security or any security convertible into or exchangeable or exercisable for any equity security of the Company sold or issued by the Company at any time hereafter other than in a public offering to agree to be bound to a substantially similar Lock-up in the event of an underwritten registration pursuant to Section 2.1 or 2.2. (b) The Company hereby agrees that, if it shall previously have received a request for registration (other than a shelf registration) pursuant to Section 2.1 or 2.2, and if such previous registration shall not have been withdrawn or abandoned, the Company shall not sell, transfer, or otherwise dispose of, any Common Stock, or any other equity security of the Company or any security convertible into or exchangeable or exercisable for any equity security of the Company (other than as part of such underwritten public 14 offering, common stock issued in connection with the acquisition of a business or assets, a registration on Form S-4 or Form S-8 or any successor or similar form which is then in effect or upon the conversion, exchange or exercise of any then outstanding Common Stock Equivalent), until a period of 90 days shall have elapsed from the effective date of such registration or such longer period (not to exceed 180 days) as each Holder of Registrable Securities is required to agree to pursuant to Section 2.7(a). 2.8. No Required Sale. Nothing in this Agreement shall be deemed to create an independent obligation on the part of any Holder to sell any Registrable Securities pursuant to any effective registration statement. 2.9. Indemnification. (a) In the event of any registration of any securities of the Company under the Securities Act pursuant to this Article 2, the Company will, and hereby does, indemnify and hold harmless, to the fullest extent permitted by law, each Holder of Registrable Securities, its directors, officers, fiduciaries, employees and stockholders or general and limited partners (and the directors, officers, employees and stockholders thereof), each other Person who participates as an underwriter or a Qualified Independent Underwriter, if any, in the offering or sale of such securities, each officer, director, employee, stockholder, fiduciary, managing director, agent, affiliates, consultants, representatives, successors, assigns or partner of such underwriter or Qualified Independent Underwriter, and each other Person, if any, who controls such seller or any such underwriter within the meaning of the Securities Act, against any and all losses, claims, damages or liabilities, joint or several, actions or proceedings (whether commenced or threatened) and expenses (including reasonable fees of counsel and any amounts paid in any settlement effected with the Company's consent, which consent shall not be unreasonably withheld or delayed) to which each such indemnified party may become subject under the Securities Act or otherwise in respect thereof (collectively, "Claims"), insofar as such Claims arise out of or are based upon (i) any untrue statement or alleged untrue statement of a material fact contained in any registration statement under which such securities were registered under the Securities Act or the omission or alleged omission to state therein a material fact required to be stated therein or necessary to make the statements therein not misleading, (ii) any untrue statement or alleged untrue statement of a material fact contained in any preliminary, final or summary prospectus or any amendment or supplement thereto, together with the documents incorporated by reference therein, or the omission or alleged omission to state therein a material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they were made, not misleading, or (iii) any violation by the Company of any federal, state or common law rule or regulation applicable to the Company and relating to action required of or inaction by the Company in connection with any such registration, and the Company will reimburse any such indemnified party for any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any such Claim as such expenses are incurred; provided, however, that the Company shall not be liable to any such indemnified party in any such case to the extent such Claim arises out of or is based upon any untrue statement or alleged untrue statement of a material fact or omission or alleged omission of a material fact made in such registration statement or amendment thereof or supplement thereto or 15 in any such prospectus or any preliminary, final or summary prospectus in reliance upon and in conformity with written information furnished to the Company by or on behalf of such indemnified party specifically for use therein. Such indemnity and reimbursement of expenses shall remain in full force and effect regardless of any investigation made by as on behalf of such indemnified party and shall survive the transfer of such securities by such seller. (b) Each Holder of Registrable Securities that are included in the securities as to which any registration under Section 2.1 or 2.2 is being effected (and, if the Company requires as a condition to including any Registrable Securities in any registration statement filed in accordance with Section 2.1 or 2.2, any underwriter and Qualified Independent Underwriter, if any) shall, severally and not jointly, indemnify and hold harmless (in the same manner and to the same extent as set forth in paragraph (a) of this Section 2.9) to the extent permitted by law the Company, its officers and directors, each Person controlling the Company within the meaning of the Securities Act and all other prospective sellers and their respective directors, officers, fiduciaries, managing directors, employees, agents, affiliates, consultants, representatives, successors, assigns, general and limited partners, stockholders and respective controlling Persons with respect to any untrue statement or alleged untrue statement of any material fact in, or omission or alleged omission of any material fact from, such registration statement, any preliminary, final or summary prospectus contained therein, or any amendment or supplement thereto, if such statement or alleged statement or omission or alleged omission was made in reliance upon and in conformity with written information furnished to the Company or its representatives by or on behalf of such Holder or underwriter or Qualified Independent Underwriter, if any, specifically for use therein and reimburse such indemnified party for any legal or other expenses reasonably incurred in connection with investigating or defending any such Claim as such expenses are incurred; provided, however, that the aggregate amount which any such Holder shall be required to pay pursuant to this Section 2.9(b) and Sections 2.9(c) and (e) shall in no case be greater than the amount of the net proceeds received by such person upon the sale of the Registrable Securities pursuant to the registration statement giving rise to such claim. Such indemnity and reimbursement of expenses shall remain in full force and effect regardless of any investigation made by or on behalf of such indemnified party and shall survive the transfer of such securities by such Holder. (c) Indemnification similar to that specified in the preceding paragraphs (a) and (b) of this Section 2.9 (with appropriate modifications) shall be given by the Company and each seller of Registrable Securities with respect to any required registration or other qualification of securities under any state securities and "blue sky" laws. (d) Any person entitled to indemnification under this Agreement shall notify promptly the indemnifying party in writing of the commencement of any action or proceeding with respect to which a claim for indemnification may be made pursuant to this Section 2.9, but the failure of any indemnified party to provide such notice shall not relieve the indemnifying party of its obligations under the preceding paragraphs of this Section 2.9, except to the extent the indemnifying party is materially prejudiced thereby and shall not relieve the indemnifying party from any liability which it may have to any 16 indemnified party otherwise than under this Article 2. In case any action or proceeding is brought against an indemnified party and it shall notify the indemnifying party of the commencement thereof, the indemnifying party shall be entitled to participate therein and, unless in the reasonable opinion of outside counsel to the indemnified party a conflict of interest between such indemnified and indemnifying parties may exist in respect of such claim, to assume the defense thereof jointly with any other indemnifying party similarly notified, to the extent that it chooses, with counsel reasonably satisfactory to such indemnified party, and after notice from the indemnifying party to such indemnified party that it so chooses, the indemnifying party shall not be liable to such indemnified party for any legal or other expenses subsequently incurred by such indemnified party in connection with the defense thereof other than reasonable costs of investigation; provided, however, that (i) if the indemnifying party fails to take reasonable steps necessary to defend diligently the action or proceeding within 20 days after receiving notice from such indemnified party that the indemnified party believes it has failed to do so; or (ii) if such indemnified party who is a defendant in any action or proceeding which is also brought against the indemnifying party reasonably shall have concluded that there may be one or more legal defenses available to such indemnified party which are not available to the indemnifying party; or (iii) if representation of both parties by the same counsel is otherwise inappropriate under applicable standards of professional conduct, then, in any such case, the indemnified party shall have the right to assume or continue its own defense as set forth above (but with no more than one firm of counsel (selected by AIHL, if AIHL has participated in the applicable registration and is an indemnified party, or, if AIHL has not participated in the applicable registration or is not an indemnified party, selected by the Initiating Holder in the case of a registration pursuant to Section 2.1, or selected by the Major Holder, in the case of a registration pursuant to Section 2.2) for all indemnified parties in each jurisdiction, except to the extent any indemnified party or parties reasonably shall have concluded that there may be legal defenses available to such party or parties which are not available to the other indemnified parties or to the extent representation of all indemnified parties by the same counsel is otherwise inappropriate under applicable standards of professional conduct) and the indemnifying party shall be liable for any expenses therefor. No indemnifying party shall, without the written consent of the indemnified party, effect the settlement or compromise of, or consent to the entry of any judgment with respect to, any pending or threatened action or claim in respect of which indemnification or contribution may be sought hereunder (whether or not the indemnified party is an actual or potential party to such action or claim) unless such settlement, compromise or judgment (A) includes an unconditional release of the indemnified party from all liability arising out of such action or claim and (B) does not include a statement as to or an admission of fault, culpability or a failure to act, by or on behalf of any indemnified party. (e) If for any reason the foregoing indemnity is unavailable or is insufficient to hold harmless an indemnified party under Section 2.9(a), (b) or (c), then each indemnifying party shall contribute to the amount paid or payable by such indemnified party as a result of any Claim in such proportion as is appropriate to reflect the relative fault of the indemnifying party, on the one hand, and the indemnified party, on the other hand, with respect to such offering of securities. The relative fault shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to 17 information supplied by the indemnifying party or the indemnified party and the parties' relative intent, knowledge, access to information and opportunity to correct or prevent such untrue statement or omission. If, however, the allocation provided in the second preceding sentence is not permitted by applicable law, then each indemnifying party shall contribute to the amount paid or payable by such indemnified party in such proportion as is appropriate to reflect not only such relative faults but also the relative benefits of the indemnifying party and the indemnified party as well as any other relevant equitable considerations. The parties hereto agree that it would not be just and equitable if contributions pursuant to this Section 2.9(e) were to be determined by pro rata allocation or by any other method of allocation which does not take account of the equitable considerations referred to in the preceding sentences of this Section 2.9(e). The amount paid or payable in respect of any Claim shall be deemed to include any legal or other expenses reasonably incurred by such indemnified party in connection with investigating or defending any such Claim. 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. Notwithstanding anything in this section 2.9(e) to the contrary, no indemnifying party (other than the Company) shall be required pursuant to this section 2.9(e) to contribute any amount in excess of the net proceeds received by such indemnifying party from the sale of Registrable Securities in the offering to which the losses, claims, damages or liabilities of the indemnified parties relate, less the amount of any indemnification payment made by such indemnifying party pursuant to Sections 2.9(b) and (c). (f) The indemnity agreements contained herein shall be in addition to any other rights to indemnification or contribution which any indemnified party may have pursuant to law or contract and shall remain operative and in full force and effect regardless of any investigation made or omitted by or on behalf of any indemnified party and shall survive the transfer of the Registrable Securities by any such party. (g) The indemnification and contribution required by this Section 2.9 shall be made by periodic payments of the amount thereof during the course of the investigation or defense, as and when bills are received or expense, loss, damage or liability is incurred. 3. Underwritten Offerings. 3.1. Requested Underwritten Offerings. If requested by the underwriters for any underwritten offering by the Holders pursuant to a registration requested under Section 2.1, the Company shall enter into a customary underwriting agreement with the underwriters. Such underwriting agreement shall be satisfactory in form and substance to the Initiating Holder and shall contain such representations and warranties by, and such other agreements on the part of, the Company and such other terms as are generally prevailing in agreements of that type, including, without limitation, indemnities and contribution agreements on substantially the same terms as those contained herein. Any Holder participating in the offering shall be a party to such underwriting agreement and may, at its option, require that any or all of the representations and warranties by, and the other agreements on the part of, the Company to and for the benefit of such underwriters shall also be made to and for the 18 benefit of such Holder and that any or all of the conditions precedent to the obligations of such underwriters under such underwriting agreement be conditions precedent to the obligations of such Holder; provided, however, that the Company shall not be required to make any representations or warranties with respect to written information specifically provided by a selling Holder for inclusion in the registration statement. Such underwriting agreement shall also contain such representations and warranties by the participating Holders with respect to title and ownership of shares as are customary in agreements of that type. 3.2. Piggyback Underwritten Offerings. In the case of a registration pursuant to Section 2.2 hereof, if the Company shall have determined to enter into an underwriting agreement in connection therewith, all of the Holders' Registrable Securities to be included in such registration shall be subject to such underwriting agreement. Any Holder participating in such registration may, at its option, require that any or all of the representations and warranties by, and the other agreements on the part of, the Company to and for the benefit of such underwriters shall also be made to and for the benefit of such Holder and that any or all of the conditions precedent to the obligations of such underwriters under such underwriting agreement be conditions precedent to the obligations of such Holder. Such underwriting agreement shall also contain such representations and warranties by the participating Holders as are customary in agreements of that type, on substantially the same terms as those contained herein. 4. General. 4.1. Rule 144. If the Company shall have filed a registration statement pursuant to the requirements of Section 12 of the Exchange Act or a registration statement pursuant to the requirements of the Securities Act in respect of the Common Stock or securities of the Company convertible into or exchangeable or exercisable for Common Stock, the Company covenants that (i) so long as it remains subject to the reporting provisions of the Exchange Act, it will timely file the reports required to be filed by it under the Securities Act or the Exchange Act (including, but not limited to, the reports under Sections 13 and 15(d) of the Exchange Act referred to in subparagraph (c)(1) of Rule 144 under the Securities Act), and (ii) will take such further action as any Holder of Registrable Securities may reasonably request, all to the extent required 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 (A) Rule 144 under the Securities Act, as such Rule may be amended from time to time, or (B) any similar rule or regulation hereafter adopted by the SEC. Upon the request of any Holder of Registrable Securities, the Company will deliver to such Holder a written statement as to whether it has complied with such requirements. 4.2. Nominees for Beneficial Owners. If Registrable Securities are held by a nominee for the beneficial owner thereof, the beneficial owner thereof may, at its option, be treated as the Holder of such Registrable Securities for purposes of any request or other action by any Holder or Holders of Registrable Securities pursuant to this Agreement (or any determination of any number or percentage of shares constituting Registrable Securities held by any Holder or Holders of Registrable 19 Securities contemplated by this Agreement), provided that the Company shall have received assurances reasonably satisfactory to it of such beneficial ownership. 4.3. Amendments and Waivers. The terms and provisions of this Agreement may be modified or amended, or any of the provisions hereof waived, temporarily or permanently, pursuant to the written consent of the Company and AIHL (without the consent of the other Holders of Registrable Securities); provided, however, that if AIHL no longer holds any Registrable Securities, then the consent of the Holder or Holders of a majority of the then outstanding Registrable Securities (and not AIHL) would be required (and such consent of the Holder or Holders of a majority of the then outstanding Registrable Securities would be binding upon all Holders of then outstanding Registrable Securities). 4.4. Notices. All notices, requests and other communications pursuant to this Agreement shall be in writing and shall be deemed to have been duly given, if delivered in person or by courier, or sent by express, registered or certified mail, postage prepaid, to AIHL or to the Company at the address set forth below: (a) If to AIHL, to: Alleghany Insurance Holdings LLC c/o Alleghany Corporation 7 Times Square Tower 17th Floor New York, NY 10036 Attention: Chairman with a copy to: Alleghany Corporation 7 Times Square Tower 17th Floor New York, NY 10036 Attention: General Counsel (b) If to the Company, to: Darwin Professional Underwriters, Inc. 9 Farm Springs Road Farmington, Connecticut 06032 Attention: Chairman with a copy to: Darwin Professional Underwriters, Inc. 9 Farm Springs Road Farmington, Connecticut 06032 Attention: General Counsel 20 Any party may, by written notice to the other party hereto, change the address to which notices to such party are to be delivered or mailed. 4.5. Miscellaneous. (a) This Agreement shall be binding upon and inure to the benefit of and be enforceable by the parties hereto and the respective successors, personal representatives and assigns of the parties hereto, whether so expressed or not. If any Person shall acquire Registrable Securities from any Holder, in any manner, whether by operation of law or otherwise, such transferee shall promptly notify the Company and such Registrable Securities acquired from such Holder shall be held subject to all of the terms of this Agreement, and by taking and holding such Registrable Securities such Person shall be entitled to receive the benefits of and be conclusively deemed to have agreed to be bound by and to perform all of the terms and provisions of this Agreement. If the Company shall so request, any such successor or assign shall agree in writing to acquire and hold the Registrable Securities acquired from such Holder subject to all of the terms hereof. If any Holder shall acquire additional Registrable Securities, such Registrable Securities shall be subject to all of the terms, and entitled to all the benefits, of this Agreement. (b) This Agreement (with the documents referred to herein or delivered pursuant hereto) embodies the entire agreement and understanding between the parties hereto and supersedes all prior agreements and understandings relating to the subject matter hereof. (c) The headings in this Agreement are for convenience of reference only and shall not limit or otherwise affect the meaning hereof. All section references are to this Agreement unless otherwise expressly provided. (d) This Agreement may be executed in any number of counterparts, each of which shall be an original, but all of which together shall constitute one instrument. (e) Any term or provision of this Agreement which is invalid or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such invalidity or unenforceability without rendering invalid or unenforceable the remaining terms and provisions of this Agreement or affecting the validity or enforceability of any of the terms or provisions of this Agreement in any other jurisdiction. (f) The parties hereto acknowledge that there would be no adequate remedy at law if any party fails to perform any of its obligations hereunder, and accordingly agree that each party, in addition to any other remedy to which it may be entitled at law or in equity, shall be entitled to injunctive relief, including specific performance, to enforce such obligations without the posting of any bond, and, if any action should be brought in equity to enforce any of the provisions of this Agreement, none of the parties hereto shall raise the defense that there is an adequate remedy at law. (g) Each party hereto shall do and perform or cause to be done and performed all such further acts and things and shall execute and deliver all such other agreements, certificates, instruments, and documents as any other party hereto reasonably may request 21 in order to carry out the intent and accomplish the purposes of this Agreement and the consummation of the transactions contemplated hereby. 4.6. No Inconsistent Agreements. Without the prior written consent of AIHL, if AIHL holds Registrable Securities, or the consent of the Holder of a majority of the then outstanding Registrable Securities, if AIHL no longer holds any Registrable Securities, neither the Company nor any Holder will, on or after the date of this Agreement, enter into any agreement with respect to its securities which is inconsistent with the rights granted in this Agreement or otherwise conflicts with the provisions hereof. The Company further agrees that if any other registration rights agreement entered into after the date of this Agreement with respect to any of its securities contains terms which are more favorable to, or less restrictive on, the other party thereto than the terms and conditions contained in this Agreement are (insofar as they are applicable) to AIHL and its transferees, then the terms and conditions of this Agreement shall immediately be deemed to have been amended without further action by the Company or any of the holders of Registrable Securities so that AIHL and its transferees shall be entitled to the benefit of any such more favorable or less restrictive terms or conditions. 4.7. Termination. The registration rights hereunder shall cease to apply to any particular Registrable Securities when (w) a registration statement with respect to the sale of such Registrable Securities shall have become effective under the Securities Act and such Registrable Securities shall have been disposed of in accordance with such registration statement; (x) such Registrable Securities shall have been sold to the public pursuant to Rule 144 under the Securities Act (or any successor provision); (y) such Registrable Securities shall have been otherwise transferred, new certificates for them not bearing a legend restricting further transfer shall have been delivered by the Company and subsequent public distribution of them shall not require registration or qualification of them under the Securities Act or any similar state law then in force; or (z) such Registrable Securities shall have ceased to be outstanding. 4.8. Governing Law; Consent to Jurisdiction; Waiver of Jury Trial. This Agreement shall be governed by and construed in accordance with the laws of the State of Delaware, regardless of the laws that might otherwise govern under applicable principles of conflicts of laws thereof. Each of the parties hereby irrevocably and unconditionally consents to submit to the exclusive jurisdiction of the courts of the state and federal courts located in the State of Delaware for the purposes of enforcing this Agreement. The parties shall take such actions as are within their control to cause any matter contemplated hereby to be assigned to the Chancery Court of the State of Delaware. In any action, suit or other proceeding, each of the parties hereto irrevocably and unconditionally waives and agrees not to assert by way of motion, as a defense or otherwise any claim that it is not subject to the jurisdiction of the above courts, that such action or suit is brought in an inconvenient forum or that the venue of such action, suit or other proceeding is improper. Each of the parties hereto also agrees that any final and unappealable judgment against a party hereto in connection with any action, suit or other proceeding shall be conclusive and binding on such party and that such award or judgment may be enforced in any court of competent jurisdiction, either within or outside of the United States. A certified or exemplified copy of such award or 22 judgment shall be conclusive evidence of the fact and amount of such award or judgment. Each of the parties hereto hereby irrevocably waives any and all right to trial by jury in any legal proceeding arising out of or related to this Agreement or the transactions contemplated hereby. IN WITNESS WHEREOF, the parties have executed this Registration Rights Agreement or caused their duly authorized officers to execute this Registration Rights Agreement as of the date first above written. ALLEGHANY INSURANCE HOLDINGS LLC By: /s/ WESTON M. HICKS ----------------------------------- Name: Weston M. Hicks Title: Chief Executive Officer DARWIN PROFESSIONAL UNDERWRITERS, INC. By: /s/ STEPHEN SILLS ----------------------------------- Name: Stephen Sills Title: President and CEO 23 EX-10.2 3 y21663exv10w2.txt EX-10.2: MASTER AGREEMENT Exhibit 10.2 Execution Copy MASTER AGREEMENT BETWEEN ALLEGHANY CORPORATION AND DARWIN PROFESSIONAL UNDERWRITERS, INC. Dated as of May 18, 2006 TABLE OF CONTENTS
Page ---- ARTICLE I DEFINITIONS................................................... 1 1.1 Certain Definitions............................................. 1 ARTICLE II FINANCIAL AND OTHER INFORMATION.............................. 4 2.1 Financial Information and Public Documents...................... 4 2.2 Internal Control / Audit........................................ 8 2.3 Board Meetings.................................................. 9 2.4 Corporate Compliance Program.................................... 9 ARTICLE III CERTAIN MATTERS............................................. 10 3.1 Amended and Restated Certificate of Incorporation and Amended and Restated Bylaws............................................. 10 3.2 The Initial Public Offering..................................... 10 3.3 Covenant Not to Take Certain Actions Affecting Alleghany........ 10 3.4 Adoption of Stockholder Rights Plan............................. 10 3.5 Dilutive Issuances.............................................. 10 3.6 Repurchase of Common Stock...................................... 11 ARTICLE IV OTHER AGREEMENTS............................................. 11 4.1 Further Assurances.............................................. 11 4.2 Insurance Matters............................................... 11 4.3 Indemnification................................................. 12 4.4 Investment Management........................................... 12 4.5 Allocation of Costs and Expenses................................ 12 4.6 Charter Provision............................................... 13 4.7 Alleghany Policies.............................................. 13 ARTICLE V MISCELLANEOUS................................................. 13 5.1 Governing Law; Consent to Jurisdiction; Waiver of Jury Trial.... 13 5.2 Survival of Covenants........................................... 14 5.3 Notices......................................................... 14 5.4 Severability.................................................... 14 5.5 Entire Agreement................................................ 15 5.6 Amendment....................................................... 15 5.7 Rules of Construction........................................... 15 5.8 Counterparts.................................................... 15 5.9 Specific Performance............................................ 16 5.10 Further Assurances.............................................. 16
i MASTER AGREEMENT MASTER AGREEMENT, dated as of May 18, 2006 (this "Agreement"), by and between Alleghany Corporation, a Delaware corporation ("Alleghany") and Darwin Profession Underwriters, Inc., a Delaware corporation ("DPUI"). Certain terms used in this Agreement are defined in Section 1.1. WITNESSETH: WHEREAS, as of the date hereof, Alleghany, through its wholly-owned subsidiary Alleghany Insurance Holdings LLC, owns approximately 90% of the issued and outstanding voting securities of DPUI; and WHEREAS, DPUI has previously filed the IPO Registration Statement (as herein defined) with the Securities and Exchange Commission but it has not yet become effective; and WHEREAS, immediately following the consummation of the Initial Public Offering (as herein defined), Alleghany will continue to own more than 50% of the outstanding voting securities of DPUI; and WHEREAS, Alleghany may in the future further reduce its equity ownership of DPUI; and WHEREAS, it is appropriate and desirable to set forth the agreements that will, following the consummation of the Initial Public Offering, govern certain matters relating to the Initial Public Offering and the relationship of Alleghany, DPUI and their respective Subsidiaries (as herein defined). NOW, THEREFORE, in consideration of the premises and the covenants and agreements contained herein, and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, and intending to be legally bound hereby, the parties hereby agree as follows: ARTICLE I DEFINITIONS 1.1. Certain Definitions. For purposes of this Agreement, the following terms shall have the meanings specified in this Section 1.1: "Affiliate" (and, with a correlative meaning, "affiliated") means, with respect to any Person, any direct or indirect subsidiary of such Person, and any other Person that directly, or through one or more intermediaries, controls or is controlled by or is under common control with such first Person; provided, however, that from and after the Closing Date, no member of the DPUI Group shall be deemed an Affiliate of any member of the Alleghany Group for purposes of this Agreement and no member of the Alleghany Group shall be deemed an Affiliate of any member of the DPUI Group for purposes of this Agreement. As used in this definition, "control" (including with correlative meanings, "controlled by" and "under common control with") means possession, directly or indirectly, of power to direct or cause the direction of management or policies or the power to appoint and remove a majority of directors (whether through ownership of securities or partnership or other ownership interests, by contract or otherwise). "Alleghany Audit Committee" means the Audit Committee of the Alleghany Board. "Alleghany Auditors" means the independent certified public accountants of Alleghany. "Alleghany Board" means the Board of Directors of Alleghany. "Alleghany Designated Officer" means either of the Senior Vice President - Finance and Investments or the Vice President - Finance of Alleghany. "Alleghany Group" means Alleghany and each Person (other than any member of the DPUI Group) that, at any time of determination, is a Subsidiary of Alleghany. "Alleghany Representatives" means the officers and directors of Alleghany and Persons designated by them (including without limitation legal counsel and other professional advisors) to act on behalf of Alleghany. "Business Day" means a day other than a Saturday, Sunday or other day on which commercial banks in New York City are authorized or required by Law to close. Any event the scheduled occurrence of which would fall on a day that is not a Business Day shall be deferred until the next succeeding Business Day. "Capitol Companies" means, collectively, Capitol Insurance Corporation, Capitol Specialty Insurance Corporation, and Platte River Insurance Company. "CEO" means, with respect to either Alleghany or DPUI, its chief executive officer. "CFO" means, with respect to either Alleghany or DPUI, its chief financial officer. "Closing Date" means the closing of the Initial Public Offering. "Common Stock" means the common stock, $0.01 par value per share, of DPUI. "DPUI Audit Committee" means the Audit Committee of the DPUI Board. 2 "DPUI Auditors" means the independent certified public accountants of DPUI. "DPUI Board" means the Board of Directors of DPUI. "DPUI Group" means, at any time of determination, DPUI and each Subsidiary of DPUI. "Effective Time" means the time that the IPO Registration Statement is declared effective by the SEC. "Exchange Act" shall mean the Securities Exchange Act of 1934, as amended, and the rules and regulations of the SEC thereunder, all as the same shall be in effect at the time that reference is made thereto. "GAAP" means United States generally accepted accounting principles. "Governmental Authority" means any entity exercising executive, legislative, judicial, regulatory or administrative functions of or pertaining to government, including any governmental authority, agency, department, board, commission or instrumentality whether federal, state, local or foreign (or any political subdivision thereof), and any tribunal, court or arbitrator(s) of competent jurisdiction. "Initial Public Offering" means the initial public offering of the Common Stock. "IPO Registration Statement" means the registration statement on Form S-1 filed under the Securities Act (No. 333-132355) pursuant to which the Common Stock to be sold in the Initial Public Offering will be registered, including the Prospectus related thereto, amendments and supplements to the Registration Statement, including post-effective amendments, all exhibits and all materials incorporated by reference in the Registration Statement and Prospectus. "Law" means any federal, state, local or foreign law (including common law), statute, code, ordinance, rule, regulation or other requirement enacted, promulgated, issued or entered by a Governmental Authority. "NYSE Arca" means NYSE Arca Exchange or, if the Common Stock at any time shall not be traded on the NYSE Acra Exchange, then such securities exchange (including for this purpose the NASDAQ National Market) on which the Common Stock is then traded. "Person" means any individual, corporation, partnership, firm, joint venture, association, joint-stock company, trust, unincorporated organization, Governmental Authority or other entity. "Prospectus" means the prospectus or prospectuses included in the Registration Statement, as amended or supplemented by any prospectus supplement and 3 by all other amendments and supplements to any such prospectus, including post-effective amendments and all material incorporated by reference in such prospectus or prospectuses. "Purchase Agreement" means the Purchase Agreement to be entered into by and among DPUI and the Underwriters in connection with the offering of Common Stock by DPUI in the Initial Public Offering. "Registration Rights Agreement" means the Registration Rights Agreement to be entered into by and between Alleghany Insurance Holdings LLC and DPUI, substantially in the form filed or to be filed as an exhibit to the IPO Registration Statement. "SEC" means the Securities and Exchange Commission. "Securities Act" means the Securities Act of 1933, as amended. "Subsidiary" or "subsidiary" means, with respect to any Person, any corporation, limited liability company, joint venture or partnership of which such Person (a) beneficially owns, either directly or indirectly, more than fifty percent (50%) of (i) the total combined voting power of all classes of voting securities of such entity, (ii) the total combined equity interests, or (iii) the capital or profit interests, in the case of a partnership; or (b) otherwise has the power to vote, either directly or indirectly, sufficient securities to elect a majority of the board of directors or similar governing body. "Tax Sharing Agreement" means the Tax Sharing Agreement, dated as of January 1, 2005, entered into by and between Alleghany Insurance Holdings LLC and DPUI. "Underwriters" means the managing underwriters for the Initial Public Offering. ARTICLE II FINANCIAL AND OTHER INFORMATION 2.1 Financial Information and Public Documents. DPUI agrees that if Alleghany is required during or for any fiscal year, in accordance with GAAP, to account for its investment in DPUI on a consolidated basis or under the equity method of accounting, then in respect of such fiscal year: (a) Fiscal Year. DPUI shall, and shall cause each of its consolidated subsidiaries to, maintain a fiscal year which commences on January 1 and ends on December 31 of each calendar year. (b) Monthly Financial Information. DPUI shall furnish to Alleghany a Monthly President's Report, containing monthly financial and other information, in such form and detail, and within the time periods, as are specified by the Alleghany 4 Designated Officer consistent with the requirements then applicable to other Subsidiaries of Alleghany regarding such reports. (c) Monthly, Quarterly and Annual Financial Information. DPUI shall furnish to Alleghany a Subsidiary Reporting Package containing monthly, quarterly or annual financial and other information and data with respect to DPUI and its Subsidiaries and their businesses, properties, financial position, results of operations and prospects, in such form and detail, and within the time periods, as are specified by the Alleghany Designated Officer consistent with the requirements then applicable to other Subsidiaries of Alleghany regarding such reporting packages. (d) Alleghany Public Filings. DPUI shall cooperate fully, and shall use reasonable efforts to cause the DPUI Auditors to cooperate fully, with Alleghany to the extent requested by Alleghany in the preparation of Alleghany's press releases, public earnings releases, Quarterly Reports on Form 10-Q, Annual Reports to Stockholders, Annual Reports on Form 10-K (the Annual Reports to Stockholders and the Annual Reports on Form 10-K, collectively "the Alleghany Annual Statements"), any Current Reports on Form 8-K and any amendments to any of the foregoing and any other proxy, information and registration statements, reports, notices, prospectuses and any other filings made by Alleghany with the SEC, any national securities exchange or otherwise made publicly available (collectively, "Alleghany Public Filings"). In connection with the Alleghany Public Filings, DPUI agrees: (i) to provide to Alleghany all information that Alleghany requests in connection with any such Alleghany Public Filings or that, in the judgment of Alleghany's legal department, is required to be disclosed therein under any Law. Without limiting the generality of the foregoing, DPUI will provide all required financial information with respect to it and its consolidated Subsidiaries to the Alleghany Auditors and management in sufficient and reasonable time and in sufficient detail to permit the Alleghany Auditors to take all steps and perform all review necessary, and to provide sufficient assistance to the Alleghany Auditors, with respect to information to be included or contained in the Alleghany Public Filings; (ii) to use its best efforts to provide such information in a timely manner to enable Alleghany to prepare, print and release such Alleghany Public Filings on such date as Alleghany shall determine; in this regard, DPUI shall diligently and promptly review all drafts of such Alleghany Public Filings as are requested by Alleghany and shall prepare in a diligent and timely fashion any portion of such Alleghany Public Filing pertaining to DPUI or its Subsidiaries requested by Alleghany; (iii) to provide to Alleghany in connection with each quarterly and annual report filed by Alleghany with the SEC, reasonably in advance of the Alleghany Audit Committee related to such filing, the certifications from each of the CEO and the CFO of DPUI pursuant to Section 302 of the Sarbanes-Oxley Act (the "DPUI Certifications"); provided, however, that if the DPUI 5 Certifications are not available reasonably in advance of such Alleghany Audit Committee meeting, the CEO and CFO shall sign certifications which support the certifications made by the CEO and the CFO of Alleghany in connection with such filing pursuant to Section 302 of the Sarbanes-Oxley Act of 2002, and such certification by the CEO and the CFO of DPUI shall be in such form as Alleghany then requires from its other Subsidiaries; (iv) to provide to Alleghany, reasonably in advance of the Alleghany Audit Committee meeting relating to the Annual Report on Form 10-K filed by Alleghany with the SEC, a DPUI management report, including an annual assessment by DPUI management of DPUI's internal control over financial reporting; provided, however, that if such DPUI management report is not available reasonably in advance of such Alleghany Audit Committee meeting, DPUI shall prepare and execute a management report in such form as Alleghany then requires from its other Subsidiaries; (v) that, without prior notice to Alleghany, DPUI shall not publicly release any financial or other information which conflicts with the information with respect to DPUI, any Affiliate of DPUI or the DPUI Group that is provided by DPUI for any Alleghany Public Filing; (vi) to use its best efforts to enable the DPUI Auditors to complete their audit such that they will date their opinion on DPUI's audited annual financial statements on the same date (or prior to the date) that the Alleghany Auditors date their opinion on the Alleghany Annual Statements, and to enable Alleghany to meet its timetable for the printing, filing and public dissemination of the Alleghany Annual Statements; and (vii) to provide such other information, certifications, reports or cooperation as the other Subsidiaries of Alleghany are from time to time required to provide to Alleghany. (e) DPUI Public Information and SEC Reports. DPUI shall file its Quarterly Reports on Form 10-Q and its Annual Reports on Form 10-K with the SEC as soon as possible (and in no event later than one Business Day) following Alleghany's filing of its quarterly and annual reports with the SEC for the corresponding period. In no event shall DPUI file any Quarterly Report on Form 10-Q or Annual Report on Form 10-K with the SEC prior to the time that Alleghany files its corresponding report on Form 10-Q or Form 10-K with the SEC; provided, however that such restriction shall not apply to the extent that compliance with such restriction would cause DPUI not to be in compliance with its SEC filing. DPUI shall deliver to Alleghany (to the attention of its General Counsel), no later than the date the same are printed for distribution to its stockholders, sent to its stockholders or filed with the SEC, whichever is earliest, final copies of all DPUI reports, notices and proxy and information statements to be sent or made available by DPUI or such Subsidiaries to their security holders, all regular, periodic and other reports filed under Sections 13, 14 and 15 of the Exchange Act by DPUI or such Subsidiaries and all registration statements and prospectuses to be filed by 6 DPUI or such Subsidiaries with the SEC or any securities exchange pursuant to the listed company manual (or similar requirements) of such exchange (collectively, "DPUI Public Documents"). Alleghany shall have the right to review, reasonably in advance of public release or filing or release to financial analysts or investors (i) all press releases and other statements to be made available by DPUI or any of its Subsidiaries to the public which contain DPUI financial information, results of operation, earnings guidance or information with respect to transactions or matters outside the ordinary course of DPUI's business, (ii) all reports and other information prepared by DPUI or any of its Subsidiaries for release to financial analysts or investors which contain DPUI financial information, results of operation, earnings guidance with respect to transactions or information matters outside the ordinary course of DPUI's business, and (iii) all DPUI Public Documents. (f) Earnings Releases. DPUI agrees that unless Alleghany shall have consented thereto, no member of the DPUI Group will publicly release any quarterly, annual or other financial information of DPUI or any of its Subsidiaries ("DPUI Information") prior to the time that Alleghany publicly releases financial information of Alleghany for the relevant period. DPUI shall publicly release its financial results for each annual and quarterly period immediately (and in no event later than one Business Day) following Alleghany's release of its financial results for the corresponding period. (g) Other Financial Information. DPUI shall provide to Alleghany upon request such other financial information and analyses of DPUI and its Subsidiaries that may from time to time be requested by Alleghany, including without limitation such information as may be required to enable Alleghany to comply with applicable financial reporting requirements or its customary financial reporting practices. (h) Annual Reports Furnished to State Insurance Regulatory Authorities. Promptly following the filing by DPUI or any Subsidiary of DPUI of annual reports with any state insurance regulatory authority in each jurisdiction in which such reports are required to be filed, DPUI shall deliver the final forms of such reports to Alleghany. (i) Meetings with Financial Analysts. DPUI shall notify Alleghany reasonably in advance of the date of all scheduled meetings and conference calls to be held between DPUI and members of the investment community (including any financial analysts), and of any conferences to be attended by management of DPUI with members of the investment community, and shall consult with Alleghany as to the appropriate timing for all such scheduled meetings, calls and conferences. With respect to any such meeting, call or conference, DPUI shall not schedule such meeting or call or attend such conference on any date to which Alleghany objects. (j) Communications with Regulators. DPUI shall notify Alleghany promptly of any communications that DPUI or any member of the DPUI Group may have or receive from time to time with or from any regulators, including the SEC, any self-regulatory organization with appropriate jurisdiction, NYSE Arca and any state insurance regulators, in connection with any compliance, regulatory or accounting matters; 7 provided that DPUI shall not be required to provide notification of routine communications with or from state insurance regulators in the ordinary course of business. Without limitation of the foregoing, DPUI shall promptly provide Alleghany with copies of any written correspondence with regulators, provided that DPUI shall not be required to provide copies of routine correspondence with state insurance regulators in the ordinary course of business. 2.2 Internal Control / Audit. DPUI agrees that if Alleghany is required during or for any fiscal year, in accordance with GAAP, to account for its investment in DPUI on a consolidated basis or under the equity method of accounting, then, unless stated otherwise herein, in respect of such fiscal year: (a) Maintenance of Books and Records. DPUI shall, and shall cause each of its consolidated Subsidiaries to, (i) make and keep books, records and accounts, which, in reasonable detail, accurately and fairly reflect the transactions and dispositions of the assets of DPUI and such Subsidiaries and (ii) devise and maintain a system of internal accounting controls sufficient to provide reasonable assurances that: (A) transactions are executed in accordance with management's general or specific authorization; (B) transactions are recorded as necessary to permit preparation of financial statements in conformity with GAAP and to maintain accountability for assets; (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. (b) Access to Company Records and Personnel. DPUI shall provide the Alleghany Representatives and the Alleghany Auditors with full access to DPUI's books and records and to the internal accounting controls and operations of DPUI. DPUI shall also provide the Alleghany Representatives and the Alleghany Auditors with full access to the officers, directors and employees of DPUI and the other members of the DPUI Group and to the DPUI Auditors so that the Alleghany Representatives and the Alleghany Auditors may discuss with them the affairs, finances, accounts and prospects relating to DPUI and the other members of the DPUI Group. (c) Access to Personnel and Working Papers. DPUI will request the DPUI Auditors to make available to the Alleghany Auditors both the personnel who performed or are performing the annual audit of DPUI and, consistent with customary professional practice and courtesy of such auditors with respect to the furnishing of work papers, work papers related to the annual audit of DPUI, in all cases on a time frame that will enable the Alleghany Auditors to perform the procedures they consider necessary to take responsibility for the work of the DPUI Auditors as it relates to the Alleghany Auditors' report on the Alleghany Annual Statements, all within sufficient time to enable Alleghany to meet its timetable for the printing, filing and public dissemination of the Alleghany Annual Statements. (d) Accounting Estimates and Principles. DPUI will give Alleghany notice of any proposed material change in accounting estimates or material change in 8 accounting principle (including without limitation changes in reserving practices) from those currently in effect at DPUI and its Subsidiaries. DPUI will consult with Alleghany with respect to any such proposed change and, if requested by Alleghany, DPUI will, and will cause the DPUI Auditors to, consult with the Alleghany Auditors with respect thereto. Without limitation of the foregoing, if Alleghany so requests, DPUI will be required to obtain the concurrence of the DPUI Auditors as to such material change prior to its implementation. For so long as Alleghany is required during or for any fiscal year, in accordance with GAAP, to account for its investment in DPUI on a consolidated basis, DPUI agrees that it will not implement any such proposed material change in accounting estimates or accounting principle without Alleghany's prior written consent (excluding changes that, in the opinion of the DPUI Auditors, are mandated or required by the SEC, the Financial Accounting Standards Board or the Public Company Accounting Oversight Board). (e) Reports of Accountants and External Actuaries. Promptly, but in no event later than five Business Days following the receipt thereof, DPUI shall deliver to Alleghany copies of (i) all reports submitted to DPUI or any of its Subsidiaries by the DPUI Auditors, including, without limitation, each report submitted to DPUI or any of its Subsidiaries concerning its accounting practices and systems and any comment letter submitted to management in connection with the annual audit conducted by the DPUI Auditors and all responses by management to such reports and letters and (ii) all reports and opinions submitted to DPUI or any of its Subsidiaries by their external actuaries. (f) Alleghany Audit Committee Approval. To the extent required by statute, SEC rules and regulations, any self-regulatory organization with appropriate jurisdiction (including, without limitation, the NYSE exchange or any other stock exchange on which the shares of Alleghany common Stock are listed), or any state insurance regulators law, all engagements of the DPUI Auditors, whether for audit services or for non-audit services, must be approved by the Alleghany Audit Committee. 2.3 Board Meetings. DPUI agrees that, for so long as Alleghany is required during or for any fiscal year, in accordance with GAAP, to account for its investment in DPUI on a consolidated basis or under the equity method of accounting, then in respect of such fiscal year, at the request of Alleghany, the executive officers of DPUI shall make themselves available to attend meetings of the Alleghany Board and shall provide such reports to the Alleghany Board as Alleghany shall request. 2.4 Corporate Compliance Program. DPUI agrees, for so long as Alleghany is required during or for any fiscal year, in accordance with GAAP, to account for its investment in DPUI on a consolidated basis or under the equity method of accounting, (i) to maintain a corporate compliance program which meets, in all material respects, the elements of an "effective" corporate compliance program as defined by the U.S. Sentencing Guidelines for Organizations, (ii) at all times to have a Chief Compliance Officer who shall provide regular reports to the DPUI Audit Committee and to the Alleghany Chief Compliance Officer (the "Alleghany CCO"), (iii) at the request of the Alleghany CCO, to furnish compliance information related to DPUI and to the members of the DPUI Group, in such form and detail as may be requested by the 9 Alleghany CCO, (iv) to provide the Alleghany CCO with advance notice of any proposed change in DPUI's Code of Conduct or of any other material change proposed to other elements of its compliance program and (v) to provide notice to the Alleghany CCO of any material violation by a director, officer or employee of DPUI or other member of the DPUI Group of its Code of Conduct or other provisions of DPUI's compliance program. ARTICLE III CERTAIN MATTERS 3.1 Amended and Restated Certificate of Incorporation and Amended and Restated Bylaws. Prior to the Effective Time, each of DPUI and Alleghany shall take all necessary action that may be required to provide for the adoption by DPUI of the Amended and Restated Certificate of Incorporation of DPUI in the form attached hereto as Exhibit A (the "Charter"), and the Amended and Restated Bylaws of DPUI in the form attached hereto as Exhibit B (the "Bylaws"), in each case, with such changes thereto as may be approved by Alleghany. 3.2 The Initial Public Offering. At the direction of Alleghany, DPUI shall execute and deliver the Purchase Agreement in such form and substance as is reasonably satisfactory to Alleghany, and DPUI shall promptly take any and all actions as may be directed by Alleghany in connection with the consummation of the Initial Public Offering as contemplated by the IPO Registration Statement and the Purchase Agreement. 3.3 Covenant Not to Take Certain Actions Affecting Alleghany. DPUI hereby covenants and agrees that it shall not, without the prior written consent of Alleghany (which Alleghany may withhold in its sole and absolute discretion) take, or cause to be taken, directly or indirectly, any action which has the effect, directly or indirectly, of restricting or limiting the ability of Alleghany or any member of the Alleghany Group to freely sell, transfer, assign, pledge or otherwise dispose of shares of Common Stock. Without limiting the generality of the foregoing, DPUI shall not, without the prior written consent of Alleghany (which Allegany may withhold in its sole and absolute discretion), take any action, or recommend to its stockholders any action, which would limit the legal rights of, or deny any benefit to, Alleghany or any member of the Alleghany Group as a stockholder of DPUI in a manner not applicable to stockholders of DPUI generally. 3.4 Adoption of Stockholder Rights Plan. DPUI agrees that for so long as members of the Alleghany Group beneficially own, in the aggregate, ten percent (10%) or more of the then outstanding shares of Common Stock, DPUI shall not adopt or implement any stockholder rights plan or similar takeover defense measure without Alleghany's prior written consent. 3.5 Dilutive Issuances. DPUI agrees that for so long as members of the Alleghany Group beneficially own, in the aggregate, more than fifty percent (50%) of the then outstanding shares of Common Stock, DPUI shall not issue any shares of 10 Common Stock or any securities convertible into or exercisable or exchangeable for shares of Common Stock (including, without limitation, options and warrants) or any other rights to acquire shares of Common Stock or any such securities, or take any other action, the effect of which would be to reduce Alleghany's beneficial ownership of Common Stock to less than fifty percent (50%) of the then outstanding shares of Common Stock. 3.6 Repurchase of Common Stock. DPUI agrees that for so long as members of the Alleghany Group beneficially own, in the aggregate, more than fifty percent (50%) of the then outstanding shares of Common Stock, DPUI shall not, and shall cause the other members of the DPUI Group not to, purchase, redeem or otherwise acquire or retire for value any shares of Common Stock or any warrants, options or other rights to acquire Common Stock other than (i) the repurchase of Common Stock deemed to occur upon exercise of stock options to the extent that shares of Common Stock represent a portion of the exercise price of the stock options or are withheld by DPUI to pay applicable withholding taxes and (ii) the repurchase of Common Stock deemed to occur to the extent shares of Common Stock are withheld by DPUI to pay applicable withholding taxes in connection with any grant or vesting of restricted stock. ARTICLE IV OTHER AGREEMENTS 4.1 Further Assurances. In addition to the actions specifically provided for elsewhere in this Agreement, each of the parties hereto will cooperate with each other and use (and will cause their respective Subsidiaries and Affiliates to use) commercially reasonable efforts, prior to, on and after the Closing Date, to take, or to cause to be taken, all actions, and to do, or to cause to be done, all things reasonably necessary on its part under applicable Law or contractual obligations to consummate and make effective the transactions contemplated by this Agreement. 4.2 Insurance Matters. (a) Alleghany and DPUI acknowledge that, immediately following completion of the Initial Public Offering, members of the DPUI Group will continue to be covered under the umbrella insurance policies and the director and officer liability insurance policies maintained by Alleghany for the benefit of Alleghany and its Subsidiaries (the "Alleghany Policies"). DPUI agrees that for so long as coverage under the Alleghany Policies is continued, members of the DPUI Group will pay to Alleghany amounts representing their allocable portions of the premiums for such Alleghany Policies as determined by Alleghany. DPUI agrees that Alleghany may terminate the coverage of the members of the DPUI Group under any of the Alleghany Policies at any time upon at least 60 days' written notice to DPUI and that, upon receipt of such notice, it will be the responsibility of DPUI to obtain, at its own expense, replacement umbrella insurance and/or directors and officers liability insurance coverage. 11 (b) DPUI may terminate coverage of members of the DPUI Group under the Alleghany Policies at any time; provided that the termination by DPUI of coverage of the members of the DPUI Group under any Alleghany Policy shall not relieve the members of the DPUI Group to pay to Alleghany, through the current expiration date of such Alleghany Policy as of the time of termination of coverage of members of the DPUI Group thereunder by DPUI, amounts representing their allocable portions of the premiums under such Alleghany Policy as determined by Alleghany. (c) In no event shall Alleghany or any other member of the Alleghany Group have any liability or obligation whatsoever to any member of the DPUI Group, or to any director or officer of any member of the DPUI Group, if any of the Alleghany Policies shall be terminated or otherwise cease to be in effect or for any reason shall be unavailable or inadequate to cover any liability of any member of the DPUI Group or of any director or officer of any member of the DPUI Group. (d) DPUI agrees, on behalf of itself and each Subsidiary of DPUI, that any claim asserted by DPUI or any Subsidiary of DPUI under any of the Alleghany Policies may be asserted only through Alleghany. 4.3 Indemnification. DPUI and Alleghany agree that it shall be the responsibility of DPUI, and not the responsibility of Alleghany, to indemnify any director or officer of a member of the DPUI Group who asserts a claim for indemnification arising from his or her service as a director or officer of a member of the DPUI Group, regardless of whether such claim arises from an event occurring prior or subsequent to the completion of the Initial Public Offering. DPUI further agrees that it shall indemnify Alleghany and hold Alleghany harmless against any loss, liability or expense arising from the assertion of any such claim against Alleghany. 4.4 Investment Management. DPUI and Alleghany agree that, subsequent to the completion of the Initial Public Offering, Alleghany will have no obligation to provide investment management services or investment advice to members of the DPUI Group. DPUI acknowledges and agrees that Alleghany has no obligation to provide to members of the DPUI Group investment ideas or opportunities to share in investments made by Alleghany or made available by Alleghany to other members of the Alleghany Group. 4.5 Allocation of Costs and Expenses. DPUI agrees, for so long as Alleghany is required during or for any fiscal year, in accordance with GAAP, to account for its investment in DPUI on a consolidated basis or under the equity method of accounting, Alleghany may, with reasonable notice to and the consent of DPUI ( such consent not to be unreasonably withheld), retain third parties for the benefit of DPUI or any other member of the DPUI Group. DPUI shall pay the fees and expenses of the third party (or to the extent paid for by Alleghany, will promptly reimburse Alleghany for any and all amounts so paid), including without limitation the fees and expenses of KPMG LLP. To the extent that such fees are charged by a third party on a basis that relates to members of the Alleghany Group and members of the 12 DPUI Group, then DPUI shall be responsible for payment (or reimbursement) of the portion of such fees and expenses charged by such third party as are reasonably allocable to members of the DPUI Group. 4.6 Charter Provision. DPUI shall, and shall cause each of its Subsidiaries to, take any and all actions necessary to ensure continued compliance by DPUI and its Subsidiaries with the provisions of its certificate or articles of incorporation and by-laws. DPUI shall notify Alleghany in writing promptly after becoming aware of any act or activity taken or proposed to be taken by DPUI or any of its Subsidiaries which resulted or would result in non-compliance with any such charter provisions. DPUI and its Subsidiaries shall take or refrain from taking all actions necessary or desirable to prevent or remedy any non-compliance with the provisions of its certificate or articles of incorporation and by-laws. 4.7 Alleghany Policies. Except as otherwise agreed by Alleghany or unless superseded by any comparable policies adopted by the Darwin Board, the policies of Alleghany that apply to Subsidiaries of Alleghany shall apply to DPUI and its Subsidiaries for so long as members of the Alleghany Group beneficially own, in the aggregate, more than fifty percent (50%) of the then outstanding shares of Common Stock. The key policies of Alleghany applicable to DPUI and its Subsidiaries as of the Closing Date are listed on Schedule 4.7. ARTICLE V MISCELLANEOUS 5.1 Governing Law; Consent to Jurisdiction; Waiver of Jury Trial. This Agreement shall be governed by and construed in accordance with the laws of the State of Delaware, regardless of the laws that might otherwise govern under applicable principles of conflicts of laws thereof. Each of the parties hereby irrevocably and unconditionally consents to submit to the exclusive jurisdiction of the courts of the state and federal courts located in the State of Delaware for the purposes of enforcing this Agreement. The parties shall take such actions as are within their control to cause any matter contemplated hereby to be assigned to the Chancery Court of the State of Delaware. In any action, suit or other proceeding, each of the parties hereto irrevocably and unconditionally waives and agrees not to assert by way of motion, as a defense or otherwise any claim that it is not subject to the jurisdiction of the above courts, that such action or suit is brought in an inconvenient forum or that the venue of such action, suit or other proceeding is improper. Each of the parties hereto also agrees that any final and unappealable judgment against a party hereto in connection with any action, suit or other proceeding shall be conclusive and binding on such party and that such award or judgment may be enforced in any court of competent jurisdiction, either within or outside of the United States. A certified or exemplified copy of such award or judgment shall be conclusive evidence of the fact and amount of such award or judgment. Each of the parties hereto hereby irrevocably waives any and all right to trial by jury in any legal 13 proceeding arising out of or related to this Agreement or the transactions contemplated hereby. 5.2 Survival of Covenants. The covenants and other agreements contained in this Agreement, and liability for the breach of any obligations contained herein, shall survive the Initial Public Offering and shall remain in full force and effect. 5.3 Notices. All notices, requests and other communications pursuant to this Agreement shall be in writing and shall be deemed to have been duly given, if delivered in person or by courier, or sent by express, registered or certified mail, postage prepaid, to the Alleghany Group or to the DPUI Group at the address set forth below: If to the Alleghany Group, to: Alleghany Insurance Holdings LLC c/o Alleghany Corporation 7 Times Square Tower 17th Floor New York, NY 10036 Attention: Chairman with a copy to: Alleghany Corporation 7 Times Square Tower 17th Floor New York, NY 10036 Attention: General Counsel If to the DPUI Group, to: Darwin Professional Underwriters, Inc. 9 Farm Springs Road Farmington, Connecticut 06032 Attention: Chairman with a copy to: Darwin Professional Underwriters, Inc. 9 Farm Springs Road Farmington, Connecticut 06032 Attention: General Counsel 5.4 Severability. If any term or other provision of this Agreement is invalid, illegal or incapable of being enforced under any Law or as a matter of public policy, all other conditions and provisions of this Agreement shall nevertheless remain in full force and effect. Upon such determination that any term or other provision is invalid, illegal or incapable of being enforced, the parties to this Agreement shall negotiate in 14 good faith to modify this Agreement so as to effect the original intent of the parties as closely as possible in a mutually acceptable manner in order that the transactions contemplated by this Agreement be consummated as originally contemplated to the greatest extent possible. 5.5 Entire Agreement. Except as otherwise expressly provided in this Agreement, this Agreement (including the Schedules and Exhibits hereto) constitutes the entire agreement of the parties hereto with respect to the subject matter of this Agreement and supersedes all prior agreements and undertakings, both written and oral, between or on behalf of the parties hereto with respect to the subject matter of this Agreement. For the avoidance of doubt, nothing in this Agreement shall be deemed to supersede or to amend in any respect any of the Registration Rights Agreement, the Tax Sharing Agreement, or any other agreement currently in effect between any member of the Alleghany Group, on the one hand, and any member of the DPUI Group, on the other hand, including without limitation the agreements between members of the DPUI Group and the Capitol Companies, which have been filed as exhibits to the IPO Registration Statement (collectively, the "Intercompany Agreements"), and each of the Intercompany Agreements shall remain in full force and effect in accordance with its respective terms as such terms may be modified from time to time as permitted under the terms of such Intercompany Agreement. 5.6 Amendment. No provision of this Agreement may be amended or modified except by a written instrument signed by all the parties hereto. No waiver by any party of any provision hereof shall be effective unless explicitly set forth in writing and executed by the party so waiving. The waiver by any party hereto of a breach of any provision of this Agreement shall not operate or be construed as a waiver of any other subsequent breach. 5.7 Rules of Construction. Interpretation of this Agreement shall be governed by the following rules of construction: (a) words in the singular shall be held to include the plural and vice versa, and words of one gender shall be held to include the other gender, in each case as the context requires, (b) references to the terms Article, Section, paragraph, Schedule and Exhibit are references to the Articles, Sections, paragraphs, Schedules and Exhibits to this Agreement unless otherwise specified, (c) the word "including" and words of similar import shall mean "including, without limitation," (d) provisions shall apply, when appropriate, to successive events and transactions, (e) the table of contents and headings contained herein are for reference purposes only and shall not affect in any way the meaning or interpretation of this Agreement and (f) this Agreement shall be construed without regard to any presumption or rule requiring construction or interpretation against the party drafting or causing any instrument to be drafted. 5.8 Counterparts. This Agreement may be executed in any number of counterparts, each of which shall be an original, but all of which together shall constitute one instrument. 15 5.9 Specific Performance. The parties hereto acknowledge that there would be no adequate remedy at law if any party fails to perform any of its obligations hereunder, and accordingly agree that each party, in addition to any other remedy to which it may be entitled at law or in equity, shall be entitled to injunctive relief, including specific performance, to enforce such obligations without the posting of any bond, and, if any action should be brought in equity to enforce any of the provisions of this Agreement, none of the parties hereto shall raise the defense that there is an adequate remedy at law. 5.10 Further Assurances. Each party hereto shall do and perform or cause to be done and performed all such further acts and things and shall execute and deliver all such other agreements, certificates, instruments, and documents as any other party hereto reasonably may request in order to carry out the intent and accomplish the purposes of this Agreement and the consummation of the transactions contemplated hereby. [The remainder of this page is intentionally left blank] 16 IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed on the date first written above by their respective duly authorized officers. ALLEGHANY INSURANCE HOLDINGS LLC By: /s/ WESTON M. HICKS ----------------------------------- NAME: Weston M. Hicks Title: President and CEO DARWIN PROFESSIONAL UNDERWRITERS, INC. By: /s/ STEPHEN SILLS ----------------------------------- Name: Stephen Sills Title: President and CEO
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