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As filed with the Securities and Exchange Commission on July 23, 2001
Registration No. 333-63402
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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AMENDMENT
NO. 2
TO
FORM S-3
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
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TRENWICK GROUP LTD.
(Exact name of registrant as specified in its charter)
Bermuda 98-0232340
(State or other jurisdiction of incorporation or (I.R.S. Employer Identification Number)
organization)
Continental Building Alan L. Hunte
25 Church Street Trenwick America Corporation
Hamilton HM 12, Bermuda One Canterbury Green
(441) 292-3339 Stamford, CT 06901
(203) 353-5500
(Address, including zip code, and telephone number, (Name, address, including zip code, and telephone
including area code, of registrant's principal executive number, including area code, of agent for service)
offices)
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TRENWICK AMERICA CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 06-1087672
(State or other jurisdiction of incorporation or (I.R.S. Employer Identification Number)
organization)
Alan L. Hunte
One Canterbury Green Trenwick America Corporation
Stamford, Connecticut 06901 One Canterbury Green
(203) 353-5500 Stamford, CT 06901
(203) 353-5500
(Address, including zip code, and telephone number, (Name, address, including zip code, and telephone
including area code, of registrant's principal executive number, including area code, of agent for service)
offices)
TRENWICK AMERICA CAPITAL TRUST I
TRENWICK AMERICA CAPITAL TRUST II
TRENWICK AMERICA CAPITAL TRUST III
(Exact name of registrant as specified in its certificate of trust)
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Delaware Each Applied For
(State or other jurisdiction of incorporation or (I.R.S. Employer Identification Number)
organization)
Alan L. Hunte
One Canterbury Green Trenwick America Corporation
Stamford, Connecticut 06901 One Canterbury Green
(203) 353-5500 Stamford, CT 06901
(203) 353-5500
(Address, including zip code, and telephone number, (Name, address, including zip code, and telephone
including area code, of registrant's principal executive number, including area code, of agent for service)
offices)
Copies to:
John V. Del Col James R. Cameron, Esq.
General Counsel and Secretary Baker & McKenzie
Trenwick America Corporation 805 Third Avenue
One Canterbury Green New York, New York 10022
Stamford, CT 06901
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Approximate date of commencement of proposed sale to the public: From time
to time after this registration statement becomes effective.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box: [ ]
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box: [X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, check the following box and
list the Securities Act registration statement number of the earlier effective
registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
(continued on next page)
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The registrants hereby amend this registration statement on such date or
dates as may be necessary to delay its effective date until the registrants
shall file a further amendment which specifically states that this registration
statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until this registration statement shall become
effective on such date as the Securities and Exchange Commission, acting
pursuant to said Section 8(a), may determine.
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(continued from previous page)
CALCULATION OF REGISTRATION FEE
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Proposed Proposed
Title of each class maximum offering maximum
of securities to be Amount to be price aggregate offering Amount of
registered(1) registered(2) per unit(3)(4) price(2)(3)(4) registration fee(4)
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Common Shares of Trenwick Group
Ltd.(5)
Preferred Shares of Trenwick Group
Ltd.
Depositary Shares of Trenwick Group
Ltd.
Warrants to Purchase Common Shares of
Trenwick Group Ltd.
Warrants to Purchase Preferred Shares
of Trenwick Group Ltd.
Share Purchase Contracts of Trenwick
Group Ltd.
Share Purchase Units of Trenwick Group
Ltd.
Debt Securities of Trenwick America
Corporation
Preferred Securities of Trenwick
America Capital Trust I
Preferred Securities of Trenwick
America Capital Trust II
Preferred Securities of Trenwick
America Capital Trust III
Guarantee by Trenwick Group Ltd. of
Debt Securities of Trenwick America
Corporation(6)
Guarantees by Trenwick Group Ltd. of
Preferred Securities of Trenwick
America Capital Trust I, Trenwick
America Capital Trust II and
Trenwick America Capital Trust III
and certain backup undertakings(7)
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Total................................. $400,000,000 100% $400,000,000 $100,000
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(1) These offered securities may be sold separately, together or as units with
other offered securities.
(2) Such indeterminate number or amount of common shares, preferred shares,
depositary shares, warrants, share purchase contracts and share purchase
units of Trenwick, debt securities of Trenwick America and preferred
securities of the trusts as may from time to time be issued at indeterminate
prices, in U.S. dollars or the equivalent thereof denominated in foreign
currencies or units of two or more foreign currencies or composite
currencies (such as european currency units). In no event will the aggregate
maximum offering price of all securities issued pursuant to this
registration statement exceed $400,000,000, or if any debt securities are
issued with original issue discount, such greater amount as shall result in
an aggregate offering price of $400,000,000. Certain debt securities of
Trenwick America may be issued and sold to any or all of the Trenwick
America trusts in connection with the issuance of preferred securities by
any or all of such trusts, in which event such debt securities may later be
distributed to the holders of such preferred securities upon a dissolution
of any of the trusts and the distribution of the assets thereof.
(3) Estimated solely for purposes of calculating the registration fee.
(4) Pursuant to Rule 457(o) under the Securities Act of 1933, which permits the
registration fee to be calculated on the basis of the maximum offering price
of all the securities listed, the table does not specify by each class
information as to the amount to be registered, proposed maximum offering
price per unit or proposed maximum aggregate offering price.
(5) Also includes such presently indeterminate number of common shares as may be
issued (a) upon conversion of or exchange for any preferred shares that
provide for conversion or exchange into common shares, (b) upon exercise of
warrants to purchase common shares or (c) pursuant to share purchase
contracts. Also includes such presently indeterminate number or amount of
offered securities as may be issued (a) upon conversion of or exchange for
any preferred securities that provide for conversion or exchange into
offered securities or (b) in connection with share purchase units. Also
includes preferred share purchase rights. Prior to the occurrence of certain
events, such rights will not be exercisable or evidenced separately from the
common shares.
(6) No separate consideration will be received for the guarantee.
(7) No separate consideration will be received for the guarantees. The
guarantees include the rights of holders of the preferred securities under
the guarantees and certain backup undertakings, comprised of obligations of
Trenwick under the Trenwick America subordinated indenture and any
supplemental indentures thereto and under the applicable trust agreement to
provide certain indemnities in respect of, and be responsible for certain
costs, expenses, debts and liabilities of, each of the trusts, each as
described in this registration statement. All obligations under the
applicable trust agreement, including the indemnity obligation, are included
in the backup undertakings.
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The information in this prospectus is not complete and may be changed. We may
not sell these securities until the registration statement filed with the
Securities and Exchange Commission is effective. This prospectus is not an offer
to sell these securities and it is not soliciting an offer to buy these
securities in any state where the offer or sale is not permitted.
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SUBJECT TO COMPLETION, DATED JULY 23, 2001
PROSPECTUS
$400,000,000
Trenwick Group Ltd.
Common Shares, Preferred Shares, Depository Shares, Warrants to Purchase Common
Shares, Warrants to Purchase Preferred Shares, Share Purchase Contracts, Share
Purchase Units
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Trenwick America Corporation
Debt Securities
Fully and Unconditionally Guaranteed to the Extent Provided in this Prospectus
by
Trenwick Group Ltd.
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Trenwick America Capital Trust I
Trenwick America Capital Trust II
Trenwick America Capital Trust III
Preferred Securities
Fully and Unconditionally Guaranteed to the Extent Provided in this Prospectus
by
Trenwick Group Ltd.
Trenwick, Trenwick America or the applicable Trenwick America Trust will
provide the specific terms of these securities in supplements to this
prospectus. The prospectus supplements may also add, update or change
information contained in this prospectus. You should read this prospectus and
any supplements carefully before you invest.
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Trenwick's common shares are quoted on the New York Stock Exchange under
the symbol "TWK".
Trenwick's principal executive offices are located at: Continental
Building, 25 Church Street, Hamilton HM 12, Bermuda, telephone number (441)
292-3339. The principal executive offices of Trenwick America and each of the
trusts are located at One Canterbury Green, Stamford, Connecticut 06901,
telephone number (203) 353-5500.
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Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities or determined if this
prospectus is truthful or complete. Any representation to the contrary is a
criminal offense.
This prospectus may not be used to consummate sales of offered securities
unless accompanied by a prospectus supplement.
The date of this prospectus is , 2001.
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You should rely only on the information contained or incorporated by
reference in this prospectus or any supplement. We have not authorized anyone
else to provide you with different information. We are offering these securities
only in states where the offer is permitted. You should not assume that the
information in this prospectus or any supplement is accurate as of any date
other than the date on the front of those documents. Our business, financial
condition, results of operations and prospects may have changed since that date.
Except as expressly provided in an underwriting agreement, no offered
securities may be offered or sold in Bermuda (although offers may be made to
persons in Bermuda from outside Bermuda) and offers may only be accepted from
persons resident in Bermuda, for Bermuda exchange control purposes, where such
offers have been delivered outside of Bermuda. Persons resident in Bermuda, for
Bermuda exchange control purposes, may require the prior approval of the Bermuda
Monetary Authority in order to acquire any offered securities.
In this prospectus, references to "dollar" and "$" are to United States
currency, and the terms "United States" and "U.S." mean the United States of
America, its states, its territories, its possessions and all areas subject to
its jurisdiction.
ABOUT THIS PROSPECTUS
This prospectus is part of a registration statement that we filed with the
Securities and Exchange Commission utilizing a "shelf" registration process,
relating to the common shares, preferred shares, depositary shares, warrants,
share purchase contracts, share purchase units, debt securities, debt securities
guarantees, preferred securities and preferred securities guarantees described
in this prospectus. Under this shelf process, we may sell the securities
described in this prospectus in one or more offerings up to a total initial
offering price of $400,000,000. This prospectus provides you with a general
description of the securities we may offer. This prospectus does not contain all
of the information set forth in the registration statement as permitted by the
rules and regulations of the SEC. For additional information regarding us and
the offered securities, please refer to the registration statement of which this
prospectus forms a part. Each time we sell securities, we will provide a
prospectus supplement that will contain specific information about the terms of
that offering. The prospectus supplement may also add, update or change
information contained in this prospectus. You should read both this prospectus
and any prospectus supplement together with additional information described
under the heading "Where You Can Find More Information."
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TRENWICK GROUP LTD.
Trenwick is a Bermuda holding company whose principal subsidiaries conduct
specialty insurance and reinsurance business. Trenwick was formed in 1999 to
acquire two publicly held companies, Trenwick Group Inc. and LaSalle Re Holdings
Limited, and the minority interest in LaSalle Re Limited, a business subsidiary
of LaSalle Re Holdings Limited. The acquisition was completed on September 27,
2000. Trenwick conducts its business in the following five business segments:
- Worldwide property catastrophe reinsurance;
- U.S. treaty reinsurance;
- International specialty insurance and reinsurance;
- Lloyd's insurance and reinsurance; and
- U.S. specialty program insurance.
Trenwick operates through the following five principal operating platforms:
- LaSalle Re Limited, which is located in Hamilton, Bermuda, underwrites
property catastrophe reinsurance on a worldwide basis;
- Trenwick America Reinsurance Corporation, which is located in Stamford,
Connecticut, underwrites treaty reinsurance on United States property and
casualty risks, including United States reinsurance business previously
written by Chartwell Re Corporation's subsidiaries;
- Trenwick International Limited, which is located in London, England,
underwrites specialty insurance and treaty and facultative reinsurance on
a worldwide basis;
- Chartwell Managing Agents Limited, which is located in London, England,
manages underwriting syndicates in the Lloyd's market, principally for
Trenwick's own account; and
- Canterbury Financial Group Inc., which is located in Stamford,
Connecticut, underwrites specialty insurance through its operating
subsidiaries, Chartwell Insurance Company, The Insurance Corporation of
New York and Dakota Specialty Insurance Company.
Trenwick's principal executive office is located at the Continental
Building, 25 Church Street, Hamilton HM 12, Bermuda and its telephone number is
(441) 292-3339.
TRENWICK AMERICA CORPORATION
Trenwick America, a Delaware corporation, operated as a U.S. holding
company for Trenwick Group Inc. until September 27, 2000, when Trenwick Group
Ltd. acquired Trenwick Group Inc., LaSalle Re Holdings Limited and the minority
interest in LaSalle Re Limited. As a result of the restructuring which followed
the acquisition, Trenwick America became the intermediate holding company for
Trenwick's U.S. subsidiaries. Trenwick America's subsidiaries conduct two of the
five business segments carried on by Trenwick Group Ltd. and its
subsidiaries -- U.S. treaty reinsurance and U.S. specialty program insurance.
These segments are carried on through Trenwick America Reinsurance Corporation
and Canterbury Financial Group, Inc.
Trenwick America's principal executive office is located at One Canterbury
Green, Stamford, Connecticut 06901, and its telephone number is (203) 353-5500.
TRENWICK AMERICA CAPITAL TRUST I
TRENWICK AMERICA CAPITAL TRUST II
TRENWICK AMERICA CAPITAL TRUST III
Each trust is a statutory business trust created under Delaware law
pursuant to (1) a trust agreement executed by Trenwick America, as depositor of
the trust, and the trustees for the trust and (2) the filing
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of a certificate of trust with the Delaware Secretary of State on June 18, 2001.
Each trust agreement will be amended and restated in its entirety substantially
in the form filed as an exhibit to the registration statement of which this
document forms a part. Each amended and restated trust agreement will be
qualified as an indenture under the Trust Indenture Act of 1939. Each trust
exists solely to:
- issue and sell the preferred and common securities, representing
undivided beneficial interests in the assets of the trust;
- use the gross proceeds from the sale of the preferred and common
securities to acquire a particular series of Trenwick America
subordinated debt securities; and
- engage in only those other activities necessary or incidental to the
issuance and sale of the preferred securities and common securities and
purchase of Trenwick America's debt securities.
Trenwick America will own all of the common securities of each trust. These
common securities will rank equally, and payments will be made thereon pro rata,
with the preferred securities of that trust, except that, if an event of default
under the applicable trust agreement resulting from an event of default under
the Trenwick America subordinated debt securities held by the trust has occurred
and is continuing, the rights of the holders of the common securities to payment
in respect of distributions and payments upon liquidation, redemption and
otherwise will be subordinated to the rights of the holders of the preferred
securities. Unless otherwise disclosed in the applicable prospectus supplement,
Trenwick America will acquire common securities having an aggregate liquidation
amount equal to at least 3% of the total capital of each trust. Each of the
trusts is a legally separate entity and the assets of one are not available to
satisfy the obligations of the other.
Unless otherwise disclosed in the related prospectus supplement, each trust
has a term of approximately 55 years, but may dissolve earlier as provided in
the applicable trust agreement. Unless otherwise disclosed in the applicable
prospectus supplement, each trust's business and affairs will be conducted by
the trustees appointed by Trenwick America, as the holder of all of the common
securities. Unless there is an event of default under the corresponding
subordinated debt securities, Trenwick America, as the holder of the common
securities will be entitled to appoint, remove or replace any of, or increase or
reduce the number of, the trustees of the trust, subject to the terms of the
applicable trust agreement. The duties and obligations of the trustees of each
trust will be governed by the trust agreement of that trust.
Unless otherwise disclosed in the related prospectus supplement, three of
the trustees of each trust, which we refer to in this document as the
"administrative trustees," will be persons who are employees or officers of or
affiliated with Trenwick America. One trustee of each trust will be a financial
institution, which we refer to in this document as the "property trustee," that
is not affiliated with us and has a minimum amount of combined capital and
surplus of $50,000,000 or more, which shall act as property trustee and as
indenture trustee for the purposes of compliance with the provisions of the
Trust Indenture Act, pursuant to the terms set forth in the applicable
prospectus supplement. In addition, one trustee of each trust, which we refer to
in this document as the "Delaware trustee" (which may be the property trustee,
if it otherwise meets the requirements of applicable law), will have its
principal place of business or reside in the State of Delaware. Trenwick will
pay all fees and expenses related to each trust and the offering of preferred
securities and common securities.
The office of the Delaware trustee for each trust in the State of Delaware
is located at c/o Bank One Delaware, Inc., Three Christiana Center, 201 N.
Walnut St., Wilmington, Delaware 19881. The principal executive offices for each
trust is located at c/o Trenwick America Corporation, One Canterbury Green,
Stamford, Connecticut 06901. The telephone number of each trust is (203)
353-5500.
CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS
This document, any prospectus supplement, and the information incorporated
by reference in them may contain forward-looking statements within the meaning
of the Private Securities Litigation Reform
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Act of 1995. This act protects public companies from liability for
forward-looking statements in private securities actions if the forward-looking
statement is identified and is accompanied by meaningful cautionary statements
identifying important factors that could cause actual results to differ
materially. These safe harbor provisions only apply to companies that have
previously offered securities to the public. Because each trust's offer of the
preferred shares constitutes an initial public offering of securities, the safe
harbor provisions of the U.S. federal securities laws do not apply to the
offerings by each trust of its preferred shares. All projections and statements
regarding our expected performance are forward-looking statements. The
forward-looking statements may include statements for the period following
completion of this securities offering. You can find many of these statements by
looking for words such as "believes," "expects," "anticipates," "estimates,"
"continues," "may," "intends," "plans" or similar expressions in this document
or the documents incorporated by reference. You should be aware that any
forward-looking statements in this document only reflect current expectations
and are not guarantees of performance.
We have identified factors that could cause actual plans or results to
differ materially from those included in any forward-looking statements. These
factors include, but are not limited to:
- changes in the level of competition in the domestic and international
reinsurance or primary insurance markets that affect the volume or
profitability of Trenwick's property/casualty business. These changes
include, but are not limited to, changes in the intensity of price
competition, the entry of new competitors, existing competitors exiting
the market and the development of new products by new and existing
competitors;
- changes in the demand for and availability, cost or quality of
reinsurance, including changes in ceding companies' risk retentions and
changes in the demand for excess and surplus lines insurance coverages;
- the ability of Trenwick to execute its strategies in its
property/casualty operations;
- catastrophe losses in Trenwick's domestic and international
property/casualty businesses;
- adverse development on property/casualty claims and claims expense
liabilities related to business written in prior years, including, but
not limited to, evolving case law and its effect on environmental,
asbestos and other latent injury claims, changing government regulations,
newly identified toxins, newly reported claims, new theories of
liability, or new insurance and reinsurance contract interpretations;
- changes in Trenwick's property/casualty retrocessional arrangements;
- lower than estimated retrocessional or reinsurance recoveries on unpaid
losses, including, but not limited to, losses due to a decline in the
creditworthiness of Trenwick's retrocessionaires or reinsurers;
- changing rates of inflation and other economic or business conditions;
- legislative or regulatory changes, which could increase overhead costs,
increase federal and state tax assessments, restrict access to capital
markets or force participation in unprofitable markets;
- changes in loss payment patterns;
- uncertainties in the reserving process;
- necessary technological changes, which may be more difficult or expensive
to make than anticipated;
- increases in interest rates, which may cause a reduction in the market
value of Trenwick's fixed income portfolio, and its common shareholders'
equity;
- decreases in interest rates which may cause a reduction of income earned
on new cash flow from operations and the reinvestment of the proceeds
from sales or maturities of existing investments;
- a decline in the value of Trenwick's equity investments;
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- changes in the composition of Trenwick's investment portfolio;
- credit losses on Trenwick's investment portfolio;
- the passage of federal or state legislation subjecting LaSalle Re Limited
to United States taxation or regulation;
- a successful contention by the United States Internal Revenue Service
that LaSalle Re Limited is subject to United States taxation;
- the impact of mergers and acquisitions and further consolidation in the
insurance industry;
- gains or losses related to changes in foreign currency exchange rates;
- changes in Trenwick's capital needs;
- loss of the services of any of the company's key management personnel;
and
- adverse publicity or news coverage.
Actual results may differ materially from those expressed or implied by
forward-looking statements. Please take into account that forward-looking
statements speak only as of the date of this document, any prospectus supplement
or in the case of documents incorporated by reference, the date of such
documents.
USE OF PROCEEDS
Unless otherwise disclosed in the applicable prospectus supplement, we will
use the net proceeds from the sale of the offered securities for working
capital, capital expenditures, repurchases of outstanding securities and other
general corporate purposes. Each trust will invest all proceeds received from
the sale of its preferred securities and common securities in a particular
series of Trenwick America's debt securities. Until we use the net proceeds in
the manner described above, we may temporarily use them to make short-term
investments or reduce short-term borrowings.
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RATIO OF EARNINGS TO FIXED CHARGES AND RATIO OF EARNINGS TO COMBINED
FIXED CHARGES AND PREFERRED SHARE DIVIDENDS
The following table shows Trenwick America's ratio of earnings to fixed
charges and Trenwick's ratio of earnings to fixed charges and its ratio of
earnings to combined fixed charges and preferred share dividends for the periods
indicated.
For purposes of computing the Trenwick America ratio of earnings to fixed
charges, "earnings" represent income before income taxes and extraordinary item
and fixed charges. Fixed charges include interest expense and dividends on
capital securities. For purposes of computing the Trenwick ratio, "earnings"
consist of income before adjustment for minority interest in consolidated
subsidiaries and fixed charges. Fixed charges consist of interest expensed and
capitalized, amortized premiums, and discounts on capitalized expenses related
to indebtedness and preference security dividend requirements of consolidated
subsidiaries.
Twelve Months Ended December 31,
Three --------------------------------------------
Months
Ended
March 31,
2001 2000 1999 1998 1997 1996
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Trenwick America:
Ratio of earnings to fixed charges ... 1.7 -- -- 3.2 5.3 7.6
Deficiency of earnings to fixed
charges............................. -- $(58,231) $(22,250) -- -- --
Twelve Months Ended
September 30,
Three Twelve ------------------------
Months Months
Ended Ended
March 31, December 31,
2001 2000 1999 1998 1997
--------- ------------ -------- ---- ----
Trenwick:
Ratio of earnings to fixed
charges............................. 3.06 1.66 -- 35.68 73.39
Deficiency of earnings to fixed
charges........................... -- -- $ (5,679) -- --
Ratio of earnings to combined fixed
charges and preferred share
dividends......................... 3.06 -- -- 7.9 27.5
Deficiency of earnings to combined
fixed charges and preferred share
dividends......................... -- $ (708) $(12,242) -- --
The trusts had no operations during the periods set forth above.
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GENERAL DESCRIPTION OF THE OFFERED SECURITIES
Trenwick may from time to time offer under this document, separately or
together:
- common shares,
- preferred shares, which may be represented by depositary shares as
described below,
- warrants to purchase common shares,
- warrants to purchase preferred shares,
- share purchase contracts to purchase common shares, and
- share purchase units, each representing ownership of a share purchase
contract and, as security for the holder's obligation to purchase common
shares under the share purchase contract, any of (1) Trenwick America's
debt securities, (2) debt obligations of third parties, including U.S.
Treasury securities or (3) preferred securities of a trust.
Trenwick America may offer unsecured senior or subordinated debt
securities, which will be fully and unconditionally guaranteed by Trenwick to
the extent described in this document.
Each trust may offer preferred securities representing undivided beneficial
interests in its assets, which will be fully and unconditionally guaranteed by
Trenwick to the extent described in this document.
The aggregate initial offering price of the offered securities will not
exceed $400,000,000.
DESCRIPTION OF TRENWICK'S SHARE CAPITAL
The following is a summary of certain provisions of Trenwick's memorandum
of association and bye-laws. Because this summary is not complete, you should
refer to the memorandum of association and bye-laws for complete information
regarding the provisions of the memorandum of association and bye-laws,
including the definitions of some of the terms used below. Copies of the
memorandum of association and bye-laws are incorporated by reference as exhibits
to the registration statement of which this document forms a part. Whenever
particular sections or defined terms of the memorandum of association and bye-
laws are referred to, such sections or defined terms are incorporated herein by
reference, and the statement in connection with which such reference is made is
qualified in its entirety by such reference.
Trenwick's authorized share capital is 150,000,000 shares consisting of two
classes of shares. These shares consist of common shares, par value $.10 per
share and preferred shares, par value $.10 per share. As of June 30, 2001, we
had 36,855,913 common shares outstanding, which excludes unissued shares
reserved under stock option plans, warrants, stock purchase plans and various
employee compensation plans. No preferred shares are currently outstanding.
No holders of any class of authorized share capital are entitled to
preemptive rights.
Common Shares
Trenwick's common shares are quoted on the New York Stock Exchange under
the symbol "TWK." The common shares currently issued and outstanding are fully
paid and nonassessable. Common shares offered by a prospectus supplement, upon
issuance against full consideration, will be fully paid and nonassessable. A
more detailed description of our common shares is set forth in Trenwick's
registration statement filed under the Exchange Act on Form S-4 on August 23,
2000, including any amendment or report for the purpose of updating such
description.
No provisions of Bermuda law or the memorandum of association or bye-laws
impose any limitation on the rights of shareholders to hold or vote common
shares by reason of their not being residents of Bermuda.
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Dividend Rights
Subject to any preferential rights of any preferred shares created by our
board of directors, each outstanding common share is entitled to such dividends
as the board of directors may declare from time to time out of funds that
Trenwick can legally use to pay dividends.
Under Bermuda law, a company may not pay a dividend if there are reasonable
grounds for believing that (1) the company is, or would after the payment be,
unable to pay its liabilities as they become due; or (2) the realizable value of
the company's assets would thereby be less than the aggregate of its liabilities
and issued share capital and share premium accounts.
Voting Rights
The holders of common shares possess exclusive voting rights, except to the
extent our board of directors specifies voting power with respect to any
preferred stock that is issued.
Any question proposed for consideration by the common shareholders will
require the affirmative vote of more than 50% of the votes cast. The bye-laws
contain a provision limiting the voting rights of any person, partnership,
syndicate or other group who owns, directly, indirectly or constructively under
the Internal Revenue Code, 10% or more of the shares of Trenwick to 9.9%. This
provision is intended to ensure that Trenwick is not inadvertently characterized
as a controlled foreign corporation, which could cause U.S. persons owning 10%
or more of its shares to suffer adverse U.S. tax consequences. Except as
described above, the bye-laws provide that each shareholder is entitled to one
vote for each common share held by that shareholder.
Subject to the 10% voting limitation described above, all matters,
including election of directors, voted upon at any duly held shareholders'
meeting will be carried by a majority of the votes cast at the meeting by
shareholders represented in person or by proxy, except as otherwise required
under Bermuda law.
Restrictions on the transfer of Trenwick shares
Trenwick's bye-laws provide that a majority of all of the Trenwick
directors must approve any transfer that will cause any shareholder other than
an investment company to hold more than 5% of the outstanding share capital of
the company, or any shareholder that is an investment company to acquire 10% or
more of the outstanding common shares of the company.
Unilateral Repurchase of Common Shares
Trenwick's bye-laws contain a provision that if our board of directors
determines that any shareholder's share ownership may result in adverse tax,
regulatory or legal consequences to us or any shareholder, it may repurchase
shares at fair market value. Trenwick may assign this repurchase right to a
third party, including other shareholders. The same repurchase right on our
behalf applies if a shareholder involuntarily is dissolved or liquidated or
otherwise required to transfer involuntarily any or all of its shares.
Preferred Shares
The bye-laws authorize the directors to issue preferred shares in a series
and to determine the rights and preferences of each such series, to the extent
permitted by the bye-laws and applicable law. Among other rights, the directors
may determine:
- the number of preferred shares of that series and the distinctive
designation thereof;
- the dividend rights of the shares of that series, whether dividends will
be cumulative and, if so, from which date or dates and the relative
rights or priority, if any, of payment of dividends on shares of that
series and any limitations, restrictions or conditions on the payment of
dividends;
- the voting powers, full or limited, if any, of the shares of that series;
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- the terms and conditions (including the price or prices, which may vary
under different conditions and at different redemption dates), if any,
upon which all or any part of the shares of that series may be redeemed,
and any limitations, restrictions or conditions on such redemption;
- the terms, if any, upon which the shares of that series will be
convertible into or exchangeable for shares of any other series or
securities previously registered or registered in this document and
issued by Trenwick or its subsidiaries;
- the amounts, and the relative rights or priority, if any, of payment in
respect of shares of that series, which the holders of the shares of that
series will be entitled to receive upon any liquidation, dissolution or
winding up of Trenwick;
- the terms, if any, of any purchase, retirement or sinking fund to be
provided for the shares of that series; and
- any other rights, preferences, limitations and powers of that series.
The particular terms of any series of preferred shares will be set forth in
the prospectus supplement relating to the offering.
The rights, preferences, privileges and restrictions, including dividend
rights, voting rights, terms of redemption, retirement and sinking fund
provisions and liquidation preferences, if any, of the preferred shares of each
series will be fixed or designated pursuant to a certificate of designation
adopted by the board of directors or a duly authorized committee of the board of
directors. The terms, if any, on which shares of any series of preferred shares
are convertible or exchangeable into common shares will also be set forth in the
prospectus supplement relating to the offering. These terms may include
provisions for conversion or exchange, either mandatory, at the option of the
holder, or at our option, in which case the number of common shares to be
received by the holders of preferred shares would be calculated as of a time and
in the manner stated in the applicable prospectus supplement. The description of
the terms of a particular series of preferred shares that will be set forth in
the applicable prospectus supplement does not purport to be complete and is
qualified in its entirety by reference to the certificate of designation
relating to the series.
Dividends
The holders of preferred shares will be entitled to receive dividends at a
rate set by the board of directors. The board of directors may also determine
whether the dividends are cumulative or non-cumulative, whether shareholders are
entitled to compounded or accrued interest on unpaid dividends, and whether
dividends shall be payable in preference or in any other relation to the
dividends payable on any other class of classes of shares or any other series of
preferred shares.
Liquidation, Dissolution or Winding Up
The bye-laws authorize the board of directors to determine whether holders
of a series of preferred shares will be entitled to participate in distributions
on common shares in the event of liquidation, dissolution or winding up of
Trenwick.
Redemption
The bye-laws authorize the board of directors to determine whether the
preferred shares may be redeemed and, if so, the terms and conditions on which
they may be redeemed, including dates and prices of redemption. The board of
directors also may determine whether preferred shareholders are entitled to
sinking fund or other fund provisions for the redemption or purchase of
preferred shares.
Conversion Rights
The bye-laws authorize the board of directors to determine whether and
under what terms and conditions the preferred shareholders shall be entitled to
convert or exchange their shares.
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Reissuance of Shares
Any preferred shares retired by purchase, redemption, through conversion,
or through the operation of any sinking fund or redemption or purchase account,
will have the status of authorized but unissued preferred shares, and may be
reissued as part of the same class or series or may be reclassified and reissued
by the board of directors in the same manner as any other authorized an unissued
preferred shares.
Transfer Agent
Trenwick's transfer agent and agent for the common shares and the preferred
shares is First Chicago Trust Company of New York, a division of EquiServe LP.
Classified Board of Directors; Number of Directors; Filling of Vacancies
Our bye-laws provide for a board of directors divided into three classes,
with one class being elected each year to serve for a three year term. As a
result, at least two annual general meetings of shareholders may be required for
shareholders to change a majority of our board of directors. Our bye-laws also
provide that newly created directorships resulting from any increase in the
authorized number of up to 20 directors, or any vacancy, may be filled by a vote
of a majority of directors then in office. Accordingly, our board of directors
may be able to prevent any shareholder from obtaining majority representation on
the board of directors by increasing the size of the board and filling the newly
created directorships with its own nominees.
Shareholder Approval of Business Combinations
Bermuda law permits an amalgamation between two or more Bermuda companies,
or between one or more Bermuda exempted companies and one or more foreign
corporations, subject, unless the bye-laws otherwise provide, to obtaining a
majority vote of three fourths of the shareholders of each such company present
and voting in person or by proxy at a meeting called for the purpose.
Bermuda law also provides that where an offer is made for shares in a
company by another company and, within four months of the offer, the holders of
at least 90% in value of the shares which are the subject of the offer, other
than shares already held by or on behalf of the offeror, accept, the offeror may
by notice, given within two months beginning with the date on which such
acceptance is obtained, require any dissenting shareholders to transfer their
shares on the terms of the offer. Dissenting shareholders may apply to a Bermuda
court within one month of notice objecting to the transfer and the court may
make any order it thinks fit.
Bermuda law permits a company to reorganize its share capital in a scheme
of arrangement between a company and its shareholders, or any class of
shareholders, if the shareholders approve the scheme and the Supreme Court of
Bermuda sanctions the scheme following a court hearing. A scheme of arrangement
can be, and often is, used to effect a business combination between companies.
Approval of a scheme of arrangement requires the affirmative vote of the holders
of at least 75% of the shares that are represented and voted, either in person
or by proxy, at a meeting of the shareholders or, if applicable, a meeting of
the relevant class of shareholders, provided that those holders also constitute
a majority of the record holders who are present and voting, either in person or
by proxy, at the meeting.
Anti-Takeover Effects of the Bye-laws
Provisions of Trenwick's bye-laws may delay or make more difficult
unsolicited acquisitions or changes of control. We believe that these provisions
will enable us to develop our business in a manner that will foster long-term
growth without disruption caused by the threat of a takeover not thought by the
board of directors to be in the best interests of Trenwick and its shareholders.
Those provisions could have the effect of discouraging third parties from
making proposals involving an unsolicited acquisition or change of control of
our company, although the proposals, if made, might be
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considered desirable by a majority of our shareholders. Those provisions may
also have the effect of making it more difficult for third parties to cause the
replacement of our current management without the concurrence of the board of
directors. These provisions include:
- the establishment of a classified board of directors and the ability of
the board to increase its size and to appoint directors to fill newly
created or vacated directorships;
- restrictions on the transfer of Trenwick shares; and
- the Trenwick shareholder's rights plan.
Shareholders' Rights Plan
On September 26, 2000, our board of directors declared a dividend of one
Series A First Preference Share Right for each common share of Trenwick. The
rights were issued at the close of business on September 27, 2000, which is
referred to as the record date. Our board of directors also authorized the
issuance of one right for each Trenwick common share issued between the record
date and the distribution date (as described below). Each right entitles the
holder to purchase from Trenwick one one-hundredth of a Series A First
Preference Share at a purchase price of $85.00, subject to adjustment. The
description and terms of the rights are set forth in the Rights Agreement, dated
as of September 26, 2000, between Trenwick and First Chicago Trust Company of
New York, as rights agent. The Rights Agreement is attached as Exhibit 4.2 to
Trenwick's Annual Report on Form 10-K for the year ended December 31, 2000 which
we have incorporated by reference.
The rights generally will separate from the common shares and a
distribution date will occur upon the earlier of:
- 10 days following a public announcement that a person or group of
affiliated or associated persons has acquired, or obtained the right to
acquire, 15% or more of the outstanding common shares of Trenwick, or
- following the commencement of a tender or exchange offer for 15% or more
of Trenwick's outstanding common shares.
In the following description, a person or group that acquires, or obtains
the right to acquire, 15% or more of the outstanding common shares of Trenwick
is referred to as an "Acquiring Person".
Generally, if any person or group becomes an Acquiring Person, each right
except for rights held by the Acquiring Person, will entitle its holder to
purchase common shares having a market value equal to two times the exercise
price of the right.
Existing holders of 15% or more of Trenwick's common shares will not cause
the rights to be exercisable, or entitle the holders of rights to purchase
additional shares of Trenwick or any other entity, unless one of the holders
acquires additional shares.
If Trenwick is acquired in a consolidation, amalgamation, or other business
combination transaction in which Trenwick is not the surviving corporation, or
50% or more of its assets or earning power is sold or transferred after a person
or group becomes an Acquiring Person, then proper provision will be made so that
each holder of a right (other than the Acquiring Person) will be entitled to
receive common stock of the acquiring company having a market value equal to two
times the exercise price of the right. This right does not apply to those
transactions following an offer for all Trenwick's common shares which
Trenwick's independent directors determine is adequate and otherwise in the best
interests of Trenwick and its shareholders.
Trenwick's board of directors has the option, at any time after any person
or group becomes an Acquiring Person but before the Acquiring Person acquires
50% or more of the outstanding common shares, to exchange each right, except for
rights held by the Acquiring Person for one common share or one one-hundredth of
a preferred share.
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At any time prior to the time that any person or group becomes an Acquiring
Person Trenwick's board of directors may redeem the rights in whole, but not in
part, at a price of $0.01 per right. The rights will expire on September 27,
2010 if they have not been previously exercised, exchanged or redeemed.
DESCRIPTION OF THE DEPOSITARY SHARES
General
Trenwick may, at its option, elect to offer depositary shares, each
representing a fraction (to be set forth in the prospectus supplement relating
to a particular series of preferred shares) of a share of a particular series of
preferred shares as described below. In the event Trenwick elects to do so,
depositary receipts evidencing depositary shares will be issued to the public.
The shares of any class or series of preferred shares represented by
depositary shares will be deposited under a deposit agreement among Trenwick, a
depositary selected by Trenwick and the holders of the depositary receipts. The
depositary will be a bank or trust company having its principal office in the
United States and having a combined capital and surplus of at least $50,000,000.
Subject to the terms of the deposit agreement, each owner of a depositary share
will be entitled, in proportion to the applicable fraction of a preferred share
represented by such depositary share, to all the rights and preferences of the
preferred shares represented thereby (including dividend, voting, redemption and
liquidation rights).
The depositary shares will be evidenced by depositary receipts issued
pursuant to the deposit agreement. Depositary receipts will be distributed to
those persons purchasing the fractional shares of the related class or series of
preferred shares in accordance with the terms of the offering described in the
related prospectus supplement. Copies of the forms of deposit agreement and
depositary receipt are filed as exhibits to the registration statement of which
this document forms a part, and the following summary is qualified in its
entirety by reference to such exhibits.
Pending the preparation of definitive depositary receipts, the depositary
may, upon the written order of Trenwick, issue temporary depositary receipts
substantially identical to (and entitling the holders thereof to all the rights
pertaining to) the definitive depositary receipts but not in definitive form.
Definitive depositary receipts will be prepared thereafter without unreasonable
delay, and temporary depositary receipts will be exchangeable for definitive
depositary receipts without charge to the holder thereof.
Dividends and Other Distributions
The depositary will distribute all cash dividends or other distributions
received in respect of the related class or series of preferred shares to the
record holders of depositary shares relating to such class or series of
preferred shares in proportion to the number of such depositary shares owned by
such holders.
In the event of a distribution other than in cash, the depositary will
distribute property received by it to the record holders of depositary shares
entitled thereto, unless the depositary determines that it is not feasible to
make such distribution, in which case the depositary may, with the approval of
Trenwick, sell such property and distribute the net proceeds from such sale to
such holders.
Withdrawal of Shares
Upon surrender of the depositary receipts at the corporate trust office of
the depositary (unless the related depositary shares have previously been called
for redemption, converted or exchanged into other securities of Trenwick), the
holder of the depositary shares evidenced thereby is entitled to delivery of the
number of whole shares of the related class or series of preferred shares and
any money or other property represented by such depositary shares. Holders of
depositary receipts will be entitled to receive whole shares of the related
class or series of preferred shares on the basis set forth in the prospectus
supplement for such class or series of preferred shares, but holders of such
whole shares of preferred shares will not thereafter be entitled to exchange
them for depositary shares. If the depositary receipts delivered by the holder
evidence a number of depositary shares in excess of the number of depositary
shares representing
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the number of whole shares of preferred shares to be withdrawn, the depositary
will deliver to such holder at the same time a new depositary receipt evidencing
such excess number of depositary shares. In no event will fractional shares of
preferred shares be delivered upon surrender of depositary receipts to the
depositary.
Redemption of Depositary Shares
Whenever Trenwick redeems preferred shares held by the depositary, the
depositary will redeem as of the same redemption date the number of depositary
shares representing shares of the related class or series of preferred shares so
redeemed. The redemption price per depositary share will be equal to the
applicable fraction of the redemption price per share payable with respect to
such class or series of the preferred shares. If less than all the depositary
shares are to be redeemed, the depositary shares to be redeemed will be selected
by lot or pro rata as may be determined by the depositary.
From and after the date fixed for redemption, all dividends in respect of
the depositary shares called for redemption will cease to accrue, such
depositary shares will no longer be deemed to be outstanding and all rights of
the holders of the depositary receipts evidencing such depositary shares will
cease, except the right to receive any moneys payable upon such redemption and
any money or other property to which the holders of such depositary receipts
were entitled upon surrender of such depositary receipts to the depositary.
Exchange of Preferred Shares
Whenever Trenwick exchanges all of the preferred shares held by the
depositary of debt securities or common shares, the depositary will exchange as
of the same exchange date all depositary shares representing the preferred
shares so exchanged for debt securities or common shares. The exchange rate per
depositary share shall be equal to the exchange rate per preferred share
multiplied by the fraction of a preferred share represented by one depositary
share, plus all money and other property, if any, represented by such depositary
shares, including all amounts paid by Trenwick in respect of dividends which on
the exchange date have accrued on the preferred shares to be so exchanged and
have not yet been paid.
Conversion of Preferred Shares
The depositary shares, as such, are not convertible or exchangeable into
common shares or any other securities or property of Trenwick. Nevertheless, if
so specified in the applicable prospectus supplement relating to an offering of
depositary shares, the depositary receipts may be surrendered to the depositary
with written instructions to the depositary to instruct Trenwick to cause
conversion or exchange of the preferred shares represented by the depositary
shares into whole common shares, other preferred shares or debt securities of
Trenwick. Trenwick has agreed that upon receipt of such instructions and any
amounts payable in connection with the conversion or exchange, it will cause the
conversion or exchange of the depositary shares utilizing the same procedures as
those provided for delivery of preferred shares to complete such conversion or
exchange. If the depositary shares evidenced by a depositary receipt are to be
converted or exchanged in part only, a new depositary receipt or receipts will
be issued for any depositary shares not to be converted or exchanged.
Voting the Preferred Shares
Upon receipt of notice of any meeting at which the holders of the preferred
shares are entitled to vote, the depositary will mail the information contained
in such notice of meeting to the record holders of the depositary shares
relating to such preferred shares. Each record holder of such depositary shares
on the record date (which will be the same date as the record date for the
preferred shares) will be entitled to instruct the depositary as to the exercise
of the voting rights pertaining to the amount of the class or series of
preferred shares represented by such holder's depositary shares. The depositary
will endeavor, insofar as practicable, to vote the number of shares of the
preferred shares represented by such depositary shares in accordance with such
instructions, and we will agree to take all reasonable action which the
depositary
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deems necessary in order to enable the depositary to do so. The depositary will
abstain from voting shares of preferred shares to the extent it does not receive
specific instructions from the holders of depositary shares representing such
shares of preferred shares. The depositary shall not be responsible for any
failure to carry out any instruction to vote, or for the manner or effect of any
such vote made, as long as any such action or inaction is in good faith and does
not result from negligence or willful misconduct of the depositary.
Amendment and Termination of the Deposit Agreement
The form of depositary receipt evidencing the depositary shares and any
provision of the deposit agreement may at any time be amended by agreement
between Trenwick and the depositary. However, any amendment which materially and
adversely alters the rights of the holders of depositary receipts will not be
effective unless such amendment has been approved by the holders of depositary
receipts representing at least a majority (or, in the case of amendments
relating to or affecting rights to receive dividends or distributions or voting
or redemption rights, 66 2/3%, unless otherwise provided in the related
prospectus supplement) of the depositary shares then outstanding. The deposit
agreement may be terminated by Trenwick or the depositary only if (1) all
outstanding depositary shares have been redeemed, (2) there has been a final
distribution in respect of the related class or series of shares of preferred
shares in connection with our liquidation, dissolution or winding up and such
distribution has been distributed to the holders of depositary receipts or (3)
upon the consent of holders of depositary receipts representing not less than
66 2/3% of the depositary shares outstanding.
Charges of Depositary
Trenwick will pay all transfer and other taxes and governmental charges
arising solely from the existence of the depositary arrangements. Trenwick will
also pay charges of the depositary in connection with the performance of its
duties under the depository agreement in connection with the initial deposit of
the related class or series of preferred shares and any redemption of such
preferred shares. Holders of depositary receipts will pay all other transfer and
other taxes and governmental charges and such other charges as are expressly
provided in the deposit agreement to be for their accounts.
The depositary may refuse to effect any transfer of a depositary receipt or
any withdrawal of shares of a class or series of preferred shares evidenced
shares thereby until all such taxes and charges with respect to such depositary
receipt or such preferred shares are paid by the holders thereof.
Miscellaneous
The depositary will forward all reports and communications from Trenwick
which are delivered to the depositary and which Trenwick is required to furnish
to the holders of the preferred shares.
Neither the depositary nor Trenwick will be liable if it is prevented or
delayed by law or any circumstance beyond its control in performing its
obligations under the deposit agreement. The obligations of Trenwick and the
depositary under the deposit agreement will be limited to performance in good
faith of their respective duties thereunder and neither Trenwick nor the
depositary will be obligated to prosecute or defend any legal proceeding in
respect of any depositary shares or class or series of preferred shares unless
satisfactory indemnity is furnished. Trenwick and the depositary may rely on
written advice of counsel or accountants, or information provided by persons
presenting shares of preferred stock for deposit, holders of depositary shares
or other persons believed to be competent and on documents believed to be
genuine.
In the event the depositary shall receive conflicting claims, requests or
instructions from any holders of depositary receipts, on the one hand, and
Trenwick, on the other hand, the depositary shall be entitled to act on such
claims, requests or instructions received from Trenwick.
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Resignation and Removal of Depositary
The depositary may resign at any time by delivering to Trenwick notice of
its election to do so, and Trenwick may at any time remove the depositary. Any
such resignation or removal of the depositary will take effect upon the
appointment of a successor depositary, which successor depositary must be
appointed within 60 days after delivery of the notice of resignation or removal
and must be a bank or trust company having its principal office in the United
States and having a combined capital and surplus of at least $50,000,000.
DESCRIPTION OF THE WARRANTS TO PURCHASE
COMMON SHARES OR PREFERRED SHARES
The following statements with respect to the common share warrants and
preferred share warrants are summaries of, and subject to, the detailed
provisions of a share warrant agreement to be entered into by Trenwick and a
share warrant agent to be selected at the time of issue. The share warrant
agreement may include or incorporate by reference standard warrant provisions
substantially in the forms of the Common Share Warrant Agreement and the
Preferred Share Warrant Agreement filed as exhibits to the registration
statement of which this document forms a part.
General
The share warrants, evidenced by share warrant certificates, may be issued
under the share warrant agreement independently or together with any other
securities offered by any prospectus supplement and may be attached to or
separate from such other offered securities. If share warrants are offered, the
related prospectus supplement will describe the designation and terms of the
share warrants, including without limitation the following:
- the offering price, if any;
- the designation and terms of the common or preferred shares purchasable
upon exercise of the share warrants;
- if applicable, the date on and after which the share warrants and the
related offered securities will be separately transferable;
- the number of common or preferred shares purchasable upon exercise of one
share warrant and the initial price at which such shares may be purchased
upon exercise;
- the date on which the right to exercise the share warrants shall commence
and the date on which such right shall expire;
- a discussion of certain United States federal income tax considerations;
- the call provisions, if any;
- the currency, currencies or currency units in which the offering price,
if any, and exercise price are payable;
- the antidilution provisions of the share warrants; and
- any other terms of the share warrants.
The common or preferred shares issuable upon exercise of the share warrants
will, when issued in accordance with the share warrant agreement, be fully paid
and nonassessable.
Exercise of Share Warrants
Share warrants may be exercised by surrendering to the share warrant agent
the share warrant certificate with the form of election to purchase on the
reverse thereof duly completed and signed by the warrantholder, or its duly
authorized agent (such signature(s) to be guaranteed by a bank or trust
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company, by a broker or dealer which is a member of the National Association of
Securities Dealers, Inc. or by a member of a national securities exchange),
indicating the warrantholder's election to exercise all or a portion of the
share warrants evidenced by the certificate. Surrendered share warrant
certificates shall be accompanied by payment of the aggregate exercise price of
the share warrants to be exercised, as set forth in the related prospectus
supplement, in lawful money of the United States, unless otherwise provided in
the related prospectus supplement. Upon receipt thereof by the share warrant
agent, the share warrant agent will requisition from the transfer agent for the
common or preferred shares, as the case may be, for issuance and delivery to or
upon the written order of the exercising warrantholder, a certificate
representing the number of common or preferred shares purchased. If less than
all of the share warrants evidenced by any share warrant certificate are
exercised, the share warrant agent shall deliver to the exercising warrantholder
a new share warrant certificate representing the unexercised share warrants.
Antidilution and Other Provisions
The exercise price payable and the number of common or preferred shares
purchasable upon the exercise of each share warrant and the number of share
warrants outstanding will be subject to adjustment in certain events, including
the issuance of a share dividend to holders of common or preferred shares,
respectively, or a combination, subdivision or reclassification of common or
preferred shares, respectively. In lieu of adjusting the number of common shares
or preferred shares purchasable upon exercise of each share warrant, Trenwick
may elect to adjust the number of share warrants. No adjustment in the number of
shares purchasable upon exercise of the share warrants will be required until
cumulative adjustments require an adjustment of at least 1% thereof. Trenwick
may, at its option, reduce the exercise price at any time. No fractional shares
will be issued upon exercise of share warrants, but we will pay the cash value
of any fractional shares otherwise issuable. Notwithstanding the foregoing, in
case of Trenwick's consolidation, merger, or sale or conveyance of its property
as an entirety or substantially as an entirety, the holder of each outstanding
share warrant shall have the right to the kind and amount of common and
preferred shares and other securities and property (including cash) receivable
by a holder of the number of common or preferred shares into which such share
warrants were exercisable immediately prior thereto.
Modifications
The share warrant agreement and the terms of the share warrants may be
amended by Trenwick and the share warrant agent, without the consent of the
share warrant holders, for the purpose of curing any ambiguity, or of curing,
correcting or supplementing any defective or inconsistent provision contained in
the share warrant agreement, or in any other manner which Trenwick may deem
necessary or desirable and which will not materially and adversely affect the
interests of such holders.
Trenwick and the share warrant agent may also modify or amend the share
warrant agreement and the terms of the share warrants, with the consent of the
holders of not less than a majority in number of the then outstanding
unexercised share warrants affected. However, if the modification or amendment
shortens the period of time during which the share warrants may be exercised,
materially and adversely affects the exercise rights of the holders of the share
warrants or reduces the number of holders of shares whose consent is required
for modification or amendment of the share warrant agreement, the consent of
each affected holder of the share warrants is required.
No Rights as Shareholders
Holders of share warrants will not be entitled, by virtue of being such
holders, to vote, to consent, to receive dividends, to receive notice as
shareholders with respect to any meeting of shareholders for the election of
Trenwick's directors or any other matter, or to exercise any rights whatsoever
as Trenwick's shareholders.
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DESCRIPTION OF SHARE PURCHASE CONTRACTS AND SHARE PURCHASE UNITS
Trenwick may issue share purchase contracts, representing contracts
obligating holders to purchase from Trenwick, and obligating Trenwick to sell to
the holders, a specified number of common or preferred shares at a future date
or dates. The price per share and the number of common or preferred shares may
be fixed at the time the share purchase contracts are issued or may be
determined by reference to a specific formula set forth in the share purchase
contracts. Any such formula may include anti-dilution provisions to adjust the
number of common or preferred shares issuable pursuant to the share purchase
contracts upon certain events.
The share purchase contracts may be issued separately or as a part of share
purchase units consisting of a share purchase contract and, as security for the
holder's obligations to purchase the shares under the share purchase contracts,
either (1) senior debt securities or subordinated debt securities of Trenwick
America, (2) debt obligations of third parties, including U.S. Treasury
securities, or (3) preferred securities of a trust. The share purchase contracts
may require us to make periodic payments to the holders of the share purchase
units or vice versa, and such payments may be unsecured or prefunded on some
basis. The share purchase contracts may require holders to secure their
obligations in a specified manner and in certain circumstances we may deliver
newly issued prepaid share purchase contracts upon release to a holder of any
collateral securing such holder's obligations under the original share purchase
contract.
The applicable prospectus supplement will describe the terms of any share
purchase contracts or share purchase units and, if applicable, prepaid share
purchase contracts. The description in the prospectus supplement will not
purport to be complete and will be qualified in its entirety by reference to (1)
the share purchase contracts, (2) the collateral arrangements and depositary
arrangements, if applicable, relating to such share purchase contracts or share
purchase units and (3) if applicable, the prepaid share purchase contracts and
the document pursuant to which such prepaid share purchase contracts will be
issued.
DESCRIPTION OF DEBT SECURITIES AND TRENWICK GUARANTEE
The following description of the Trenwick America debt securities and the
Trenwick guarantee sets forth the material terms and provisions of the Trenwick
America debt securities and the Trenwick guarantee to which any prospectus
supplement may relate. The Trenwick America senior debt securities are to be
issued under an indenture (the "Trenwick America senior indenture") among
Trenwick America, Trenwick and Bank One Trust Company, N.A., as trustee, the
form of which is filed as an exhibit to the registration statement of which this
document forms a part. The Trenwick America subordinated debt securities are to
be issued under an indenture (the "Trenwick America subordinated indenture")
among Trenwick America, Trenwick and Bank One Trust, as trustee, the form of
which is filed as an exhibit to the registration statement of which this
document forms a part. The Trenwick America senior indenture and the Trenwick
America subordinated indenture are sometimes referred to in this document
collectively as the "Trenwick America indentures" and each individually as a
"Trenwick America indenture". The particular terms of the Trenwick America debt
securities offered by any prospectus supplement and the extent to which the
general provisions described below may apply to the offered Trenwick America
debt securities will be described in the prospectus supplement relating to such
debt securities.
Because the following summaries of the material terms and provisions of the
Trenwick America indentures and the related debt securities and guarantee are
not complete, you should refer to the forms of the Trenwick America indentures
and debt securities for complete information regarding the terms and provisions
of the Trenwick America indentures, including the definitions of some of the
terms used below, and the debt securities and guarantee. Wherever particular
articles, sections or defined terms of a Trenwick America indenture are referred
to, such articles, sections or defined terms are incorporated herein by
reference, and the statement in connection with which such reference is made is
qualified in its entirety by
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such reference. The Trenwick America indentures are substantially identical,
except for certain covenants of Trenwick America and Trenwick and provisions
relating to subordination.
General
The Trenwick America indentures do not limit the aggregate principal amount
of Trenwick America debt securities which Trenwick America may issue thereunder
and provide that Trenwick America may issue debt securities thereunder from time
to time in one or more series. (Section 3.1 of the Trenwick America indentures)
The Trenwick America indentures do not limit the amount of other Indebtedness
(as defined below) or debt securities, other than certain secured Indebtedness
as described below, which the subsidiaries may issue.
Unless otherwise provided in a prospectus supplement, the senior debt
securities will be unsecured obligations of Trenwick America and will rank
equally with all of its other unsecured and unsubordinated indebtedness. The
subordinated debt securities of each series will be unsecured obligations of
Trenwick America, subordinated in right of payment to the prior payment in full
of all Senior Indebtedness (which term includes the senior debt securities) of
Trenwick America with respect to such series, as described below under
"Subordination of the Subordinated Debt Securities" and in the related
prospectus supplement. The subordinated debt securities of any series issued to
a trust will rank equally with each other series of subordinated debt securities
issued to other trusts.
Because Trenwick America is a holding company, its rights and the rights of
its creditors (including the holders of Trenwick America debt securities) and
shareholders to participate in any distribution of assets of any subsidiary upon
that subsidiary's liquidation or reorganization or otherwise would be subject to
the prior claims of the subsidiary's creditors, except to the extent that
Trenwick America may itself be a creditor with recognized claims against the
subsidiary. The rights of creditors of Trenwick America (including the holders
of Trenwick America debt securities) to participate in the distribution of stock
owned by Trenwick America in certain of its subsidiaries, including Trenwick
America's insurance subsidiaries, may also be subject to the approval of certain
insurance regulatory authorities having jurisdiction over such subsidiaries.
In the event the subordinated debt securities are issued to any of the
trusts, in connection with such trust's issuance of preferred and common
securities, such subordinated debt securities subsequently may be distributed
pro rata to the holders of such preferred and common securities in connection
with the dissolution of such trust upon the occurrence of certain events
described in the prospectus supplement relating to such preferred and common
securities. Only one series of Trenwick America subordinated debt securities
will be issued to a trust in connection with the issuance of preferred and
common securities by the trust.
The prospectus supplement relating to the debt securities offered thereby
will describe the following terms of the offered debt securities:
- the title of such debt securities and the series in which such debt
securities will be included;
- any limit upon the aggregate principal amount of such debt securities;
- the date or dates, or the method or methods, if any, by which such date
or dates will be determined, on which the principal of such debt
securities will be payable;
- the rate or rates at which such debt securities will bear interest, if
any, which rate may be zero in the case of certain debt securities issued
at an issue price representing a discount from the principal amount
payable at maturity, or the method by which such rate or rates will be
determined (including, if applicable, any remarketing option or similar
method), and the date or dates from which such interest, if any, will
accrue or the method by which such date or dates will be determined;
- the date or dates on which interest, if any, on such debt securities will
be payable and any regular record dates applicable to the date or dates
on which interest will be so payable;
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- whether and under what circumstances additional amounts in respect of
certain taxes, fees, duties, assessments or governmental charges that
might be imposed on holders of such debt securities will be payable and,
if so, whether and on what terms Trenwick America will have the option to
redeem such debt securities in lieu of paying such additional amounts
(and the terms of such option);
- the place or places where the principal of, any premium or interest on or
any additional amounts with respect to such debt securities will be
payable, any of such debt securities that are issued in registered form
may be surrendered for registration of transfer or exchange, and any such
debt securities may be surrendered for conversion or exchange;
- whether any of such debt securities are to be redeemable at the option of
Trenwick America and, if so, the date or dates on which, the period or
periods within which, the price or prices at which and the other terms
and conditions upon which such debt securities may be redeemed, in whole
or in part, at the option of Trenwick America;
- whether Trenwick America will be obligated to redeem or purchase any of
such debt securities pursuant to any sinking fund or analogous provision
or at the option of any holder thereof and, if so, the date or dates on
which, the period or periods within which, the price or prices at which
and the other terms and conditions upon which such Trenwick America debt
securities will be redeemed or purchased, in whole or in part, pursuant
to such obligation, and any provisions for the remarketing of such debt
securities so redeemed or purchased;
- if other than denominations of $1,000 and any integral multiple thereof,
the denominations in which any Trenwick debt securities to be issued in
registered form will be issuable and, if other than a denomination of
$5,000, the denominations in which any Trenwick America debt securities
to be issued in bearer form will be issuable;
- whether the debt securities will be convertible into Trenwick common
shares or exchangeable for other securities previously registered or
registered in this document and issued by Trenwick or its subsidiaries,
and if so, the terms and conditions upon which such debt securities will
be so convertible or exchangeable;
- if other than the principal amount, the portion of the principal amount
(or the method by which such portion will be determined) of such debt
securities that will be payable upon declaration of acceleration of the
maturity thereof;
- if other than United States dollars, the currency of payment, including
composite currencies, of the principal of, any premium or interest on or
any additional amounts with respect to any of such debt securities;
- whether the principal of, any premium or interest on or any additional
amounts with respect to such debt securities will be payable, at the
election of Trenwick America or a holder, in a currency other than that
in which such debt securities are stated to be payable and the date or
dates on which, the period or periods within which, and the other terms
and conditions upon which, such election may be made;
- any index, formula or other method used to determine the amount of
payments of principal of, any premium or interest on or any additional
amounts with respect to such debt securities;
- whether such debt securities are to be issued in the form of one or more
global securities and, if so, the identity of the depositary for such
global security or securities;
- whether such debt securities are senior debt securities or subordinated
debt securities and, if subordinated debt securities, the specific
subordination provisions applicable thereto;
- in the case of subordinated debt securities, the relative degree, if any,
to which such subordinated debt securities of the series and the
guarantee in respect thereof will be senior to or be subordinated to
other series of subordinated debt securities and the guarantee in respect
thereof or other indebtedness of Trenwick America in right of payment,
whether such other series of subordinated debt securities or other
indebtedness is outstanding or not;
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- any deletions from, modifications of or additions to the events of
default (as described in this document) or covenants of Trenwick America
with respect to such debt securities;
- whether the provisions described below under "Discharge, Defeasance and
Covenant Defeasance" will be applicable to such debt securities;
- whether any of such debt securities are to be issued upon the exercise of
warrants, and the time, manner and place for such debt securities to be
authenticated and delivered; and
- any other terms of such debt securities and any other deletions from or
modifications or additions to the applicable Trenwick America indenture
in respect of such debt securities. (Section 3.1 of the Trenwick America
indentures)
We will have the ability under the Trenwick America indentures to "reopen"
a previously issued series of debt securities and issue additional debt
securities of that series or establish additional terms of that series. We are
also permitted to issue debt securities with the same terms as previously issued
debt securities. (Section 3.1 of the Trenwick America indentures)
Unless otherwise provided in the related prospectus supplement, principal,
premium, interest and additional amounts, if any, with respect to any debt
securities will be payable at the office or agency maintained by Trenwick
America for such purposes (initially the principal corporate trust office of the
trustee). In the case of debt securities issued in registered form, interest may
be paid by check mailed to the persons entitled thereto at their addresses
appearing on the security register or by transfer to an account maintained by
the payee with a bank located in the U.S. Interest on debt securities issued in
registered form will be payable on any interest payment date to the persons in
whose names the debt securities are registered at the close of business on the
regular record date with respect to such interest payment date. All paying
agents initially designated by us for the debt securities will be named in the
related prospectus supplement. We may at any time designate additional paying
agents or rescind the designation of any paying agent or approve a change in the
office through which any paying agent acts, except that we will be required to
maintain a paying agent in each place where the principal of, any premium or
interest on or any additional amounts with respect to the debt securities are
payable. (Sections 3.7 and 10.2 of the Trenwick America indentures)
Unless otherwise provided in the related prospectus supplement, the debt
securities may be presented for transfer (duly endorsed or accompanied by a
written instrument of transfer, if so required by us or the security registrar)
or exchanged for other debt securities of the same series (containing identical
terms and provisions, in any authorized denominations, and of a like aggregate
principal amount) at the office or agency maintained by Trenwick America for
such purposes (initially the corporate trust office of the trustee). Such
transfer or exchange will be made without service charge, but Trenwick America
may require payment of a sum sufficient to cover any tax or other governmental
charge and any other expenses then payable. Trenwick America will not be
required to (1) issue, register the transfer of, or exchange, debt securities
during a period beginning at the opening of business 15 days before the day of
mailing of a notice of redemption of any such debt securities and ending at the
close of business on the day of such mailing or (2) register the transfer of or
exchange any debt security so selected for redemption in whole or in part,
except the unredeemed portion of any debt security being redeemed in part.
(Section 3.5 of the Trenwick America indentures) We have appointed the trustee
as security registrar. Any transfer agent (in addition to the security
registrar) initially designated by us for any debt securities will be named in
the related prospectus supplement. We may at any time designate additional
transfer agents or rescind the designation of any transfer agent or approve a
change in the office through which any transfer agent acts, except that we will
be required to maintain a transfer agent in each place where the principal of,
any premium or interest on or any additional amounts with respect to the debt
securities are payable. (Section 10.2 of the Trenwick America indentures)
Unless otherwise provided in the related prospectus supplement, the debt
securities will be issued only in fully registered form without coupons in
minimum denominations of $1,000 and any integral multiple thereof. (Section 3.2
of the Trenwick America indentures) The debt securities may be represented in
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whole or in part by one or more global debt securities registered in the name of
a depositary or its nominee and, if so represented, interests in such global
debt security will be shown on, and transfers thereof will be effected only
through, records maintained by the designated depositary and its participants as
described below. Where debt securities of any series are issued in bearer form,
the special restrictions and considerations, including special offering
restrictions and special United States federal income tax considerations,
applicable to such debt securities and to payment on and transfer and exchange
of such debt securities will be described in the related prospectus supplement.
The debt securities may be issued as original issue discount securities
(bearing no interest or bearing interest at a rate which at the time of issuance
is below market rates) to be sold at a substantial discount below their
principal amount. Special United States federal income tax and other
considerations applicable to original issue discount securities will be
described in the related prospectus supplement.
If the purchase price of any debt securities is payable in one or more
foreign currencies or currency units or if any debt securities are denominated
in one or more foreign currencies or currency units or if the principal of, or
any premium or interest on, or any additional amounts with respect to, any debt
securities is payable in one or more foreign currencies or currency units, the
restrictions, elections, certain United States federal income tax
considerations, specific terms and other information with respect to such debt
securities and such foreign currency or currency units will be set forth in the
related prospectus supplement.
We will comply with Section 14(e) under the Exchange Act, and any other
tender offer rules under the Exchange Act which may then be applicable, in
connection with any obligation of ours to purchase debt securities at the option
of the holders. Any such obligation applicable to a series of debt securities
will be described in the related prospectus supplement.
Unless otherwise described in a prospectus supplement relating to any debt
securities, other than as described below under "-- Covenants Applicable to
Senior Debt Securities Issued to a Trust -- Limitation on Liens on Stock of
Designated Subsidiaries," the Trenwick America indentures do not contain any
provisions that would limit our ability to incur indebtedness or that would
afford holders of debt securities protection in the event of a sudden and
significant decline in our credit quality or a takeover, recapitalization or
highly leveraged or similar transaction involving us. Accordingly, we could in
the future enter into transactions that could increase the amount of
indebtedness outstanding at that time or otherwise affect our capital structure
or credit rating. You should refer to the prospectus supplement relating to a
particular series of debt securities for information regarding any deletions
from, modifications of or additions to the "events of default" described below
or covenants contained in the Trenwick America indentures, including any
addition of a covenant or other provisions providing event risk or similar
protection.
Trenwick Guarantee
Trenwick will fully and unconditionally guarantee all payments with respect
to the debt securities. Unless otherwise provided in a prospectus supplement,
the Trenwick guarantee of the senior debt securities will be an unsecured
obligation of Trenwick and will rank equally with all of its other unsecured and
unsubordinated indebtedness (including the Trenwick America senior debt
securities). The Trenwick guarantee of the subordinated debt securities of any
particular series will be an unsecured obligation of Trenwick, subordinated in
right of payment to the prior payment in full of all Trenwick America senior
indebtedness (which term includes Trenwick America senior debt securities and
the Trenwick guarantee of the Trenwick America senior debt securities) with
respect to such series as described below under "Subordination of Trenwick
Guarantee of Subordinated Debt Securities" and in the related prospectus
supplement. The Trenwick guarantee of the subordinated debt securities of any
series issued to a trust will rank equally with the guarantee of each other
series of subordinated debt securities issued to other trusts.
Since Trenwick is a holding company, its rights and the rights of its
creditors (including the holders of the debt securities who are creditors of
Trenwick by virtue of the Trenwick guarantee) and shareholders to participate in
any distribution of the assets of any subsidiary upon such subsidiary's
liquidation or
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reorganization or otherwise would be subject to prior claims of the subsidiary's
creditors, except to the extent that Trenwick may itself be a creditor with
recognized claims against the subsidiary. The right of creditors of Trenwick
(including the holders of the debt securities who are creditors of Trenwick by
virtue of the Trenwick guarantee) to participate in the distribution of the
stock owned by Trenwick in certain of its subsidiaries, including Trenwick's
insurance subsidiaries, may also be subject to approval by certain insurance
regulatory authorities having jurisdiction over such subsidiaries.
Trenwick will make all payments of principal of and premium, if any,
interest and any other amounts on, or in respect of, the debt securities of any
series without withholding or deduction at source for, or on account of, any
present or future taxes, fees, duties, assessments or governmental charges of
whatever nature imposed or levied by or on behalf of Bermuda or any political
subdivision or taxing authority thereof or therein (a "taxing jurisdiction"),
unless such taxes, fees, duties, assessments or governmental charges are
required to be withheld or deducted by (x) the laws (or any regulations or
rulings promulgated thereunder) of a taxing jurisdiction or (y) an official
position regarding the application, administration, interpretation or
enforcement of any such laws, regulations or rulings (including, without
limitation, a holding by a court of competent jurisdiction or by a taxing
authority in a taxing jurisdiction). If a withholding or deduction at source is
required, Trenwick will, subject to certain limitations and exceptions described
below, pay to the holder of any such debt security such additional amounts as
may be necessary so that every net payment of principal, premium, if any,
interest or any other amount made to such holder, after the withholding or
deduction, will not be less than the amount provided for in such debt security
and the applicable Trenwick America indenture to be then due and payable.
Trenwick will not be required to pay any additional amounts for or on
account of:
(1) any tax, fee, duty, assessment or governmental charge of whatever
nature which would not have been imposed but for the fact that such holder
(a) was a resident, domiciliary or national of, or engaged in business or
maintained a permanent establishment or was physically present in, the
relevant taxing jurisdiction or any political subdivision thereof or
otherwise had some connection with the relevant taxing jurisdiction other
than by reason of the mere ownership of, or receipt of payment under, such
debt security, (b) presented such debt security for payment in the relevant
taxing jurisdiction, unless such debt security could not have been
presented for payment elsewhere, or (c) presented such debt security for
payment more than 30 days after the date on which the payment in respect of
such debt security became due and payable or provided for, whichever is
later, except to the extent that the holder would have been entitled to
such additional amounts if it had presented such debt security for payment
on any day within that 30-day period;
(2) any estate, inheritance, gift, sale, transfer, personal property
or similar tax;
(3) any tax, assessment or other governmental charge that is imposed
or withheld by reason of the failure by the holder or the beneficial owner
of such debt security to comply with any reasonable request by Trenwick
addressed to the holder within 90 days of such request (a) to provide
information concerning the nationality, residence or identity of the holder
or such beneficial owner or (b) to make any declaration or other similar
claim or satisfy any information or reporting requirement, which in either
case is required or imposed by statute, treaty, regulation or
administrative practice of the relevant taxing jurisdiction or any
political subdivision thereof as a precondition to exemption from all or
part of such tax, assessment or other governmental charge; or
(4) any combination of items (1), (2) and (3).
In addition, Trenwick will not pay additional amounts with respect to any
payment of principal of, or premium, if any, interest or any other amounts on,
any such debt security to any holder who is a fiduciary or partnership or other
than the sole beneficial owner of such debt security to the extent such payment
would be required by the laws of the relevant taxing jurisdiction to be included
in the income for tax purposes of a beneficiary or partner or settlor with
respect to such fiduciary or a member of such partnership or a beneficial owner
who would not have been entitled to such additional amounts had it been
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the holder of the debt security. (Section 16.2 of the Trenwick America senior
indenture and Section 17.2 of the Trenwick America subordinated indenture)
Conversion and Exchange
The terms, if any, on which debt securities of any series are convertible
into or exchangeable for other securities previously registered or registered in
this document and issued by Trenwick or its subsidiaries, property or cash, or a
combination of any of the foregoing, will be set forth in the related prospectus
supplement. Such terms may include provisions for conversion or exchange, either
mandatory, at the option of the holder, or at our option, in which the
securities, property or cash to be received by the holders of the debt
securities would be calculated according to the factors and at such time as
described in the related prospectus supplement.
Global Securities
The debt securities of a series may be issued in whole or in part in the
form of one or more global debt securities that will be deposited with, or on
behalf of, a depositary identified in the prospectus supplement relating to such
series.
The specific terms of the depositary arrangement with respect to a series
of debt securities will be described in the prospectus supplement relating to
such series. We anticipate that the following provisions will apply to all
depositary arrangements.
Upon the issuance of a global security, the depositary for such global
security or its nominee will credit, on its book-entry registration and transfer
system, the respective principal amounts of the debt securities represented by
such global security. Such accounts will be designated by the underwriters or
agents with respect to such debt securities or by us if such debt securities are
offered and sold directly by us. Ownership of beneficial interests in a global
security will be limited to persons that may hold interests through
participants. Ownership of beneficial interests in such global security will be
shown on, and the transfer of that ownership will be effected only through,
records maintained by the depositary or its nominee (with respect to interests
of participants) and on the records of participants (with respect to interests
of persons other than participants). The laws of some states require that
certain purchasers of securities take physical delivery of such securities in
definitive form. Such limits and such laws may impair the ability to transfer
beneficial interests in a global security.
So long as the depositary for a global security, or its nominee, is the
registered owner of such global security, such depositary or such nominee, as
the case may be, will be considered the sole owner or holder of the debt
securities represented by such global security for all purposes under the
applicable Trenwick America indenture. Except as described below, owners of
beneficial interests in a global security will not be entitled to have debt
securities of the series represented by such global security registered in their
names and will not receive or be entitled to receive physical delivery of the
debt securities of that series in definitive form.
Principal of, any premium and interest on, and any additional amounts with
respect to, debt securities registered in the name of a depositary or its
nominee will be made to the depositary or its nominee, as the case may be, as
the registered owner of the global security representing such debt securities.
None of the trustee, any paying agent, the security registrar or us will have
any responsibility or liability for any aspect of the records relating to or
payments made on account of beneficial ownership interests of the global
security for such debt securities or for maintaining, supervising or reviewing
any records relating to such beneficial ownership interests.
We expect that the depositary for a series of debt securities or its
nominee, upon receipt of any payment with respect to such debt securities, will
credit immediately participants' accounts with payments in amounts proportionate
to their respective beneficial interest in the principal amount of the global
security for such debt securities as shown on the records of such depositary or
its nominee. We also expect that payments by participants to owners of
beneficial interests in such global security held through such participants will
be governed by standing instructions and customary practices, as is now the case
with
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securities held for the accounts of customers registered in "street name," and
will be the responsibility of such participants.
The Trenwick America indentures provide that if (1) the depositary for a
series of the debt securities notifies us that it is unwilling or unable to
continue as depositary or if such depositary ceases to be eligible under the
applicable Trenwick America indenture and a successor depositary is not
appointed by us within 90 days of written notice, (2) we determine that the debt
securities of a particular series no longer will be represented by global
securities and execute and deliver to the trustee a company order to such effect
or (3) an event of default with respect to a series of the debt securities will
have occurred and be continuing, the global securities will be exchanged for the
debt securities of such series in definitive form of like tenor and of an equal
aggregate principal amount, in authorized denominations. Such definitive debt
securities will be registered in such name or names as the depositary shall
instruct the trustee. (Section 3.5 of the Trenwick America indentures) It is
expected that such instructions may be based upon directions received by the
depositary from participants with respect to ownership of beneficial interests
in global securities.
Option to Extend Interest Payment Date
If provided in the related prospectus supplement, we will have the right at
any time and from time to time during the term of any series of subordinated
debt securities issued to a trust to defer payment of interest for such number
of consecutive interest payment periods as may be specified in the related
prospectus supplement (each, an "Extension Period"), subject to the terms,
conditions and covenants, if any, specified in such prospectus supplement,
provided that such Extension Period may not extend beyond the stated maturity of
such series of subordinated debt securities. Certain United States federal
income tax consequences and special considerations applicable to such
subordinated debt securities will be described in the related prospectus
supplement. (Section 3.11 of the Trenwick America subordinated indenture)
Option to Extend Maturity Date
If provided in the related prospectus supplement, we will have the right to
change or extend the stated maturity of the principal of the subordinated debt
securities of any series issued to a trust upon the liquidation of the trust and
the exchange of the subordinated debt securities for the preferred securities of
the trust, provided that (1) we are not in bankruptcy, otherwise insolvent or in
liquidation; (2) we have not defaulted on any payment on such subordinated debt
securities or related guarantee, as the case may be, and no deferred interest
payments have accrued, (3) the applicable trust is not in arrears on payments of
distributions on its preferred securities and no deferred distributions have
accumulated, (4) the subordinated debt securities of such series are rated
investment grade by Standard & Poor's Ratings Services, Moody's Investors
Service, Inc. or another nationally recognized statistical rating organization
and (5) the extended stated maturity is no later than the 49th anniversary of
the initial issuance of the preferred securities of the trust. If we exercise
our right to liquidate the trust and exchange the subordinated debt securities
for the preferred securities of the trust as described above, any changed stated
maturity of the principal of the subordinated debt securities shall be no
earlier than the date that is five years after the initial issue date of the
preferred securities and no later than the date 30 years (plus an extended term
of up to an additional 19 years if the conditions described above are satisfied)
after the initial issue date of the preferred securities of the trust. (Section
3.14 of the Trenwick America subordinated indenture)
Redemption
Except as otherwise provided in the related prospectus supplement, in the
case of any series of Trenwick America subordinated debt securities issued to a
trust, if an "investment company event" or a "tax event" (each, a "special
event") shall occur and be continuing, we may, at our option, redeem such series
of subordinated debt securities, in whole but not in part, at any time within 90
days of the occurrence of the Special Event, at a redemption price equal to 100%
of the principal amount of such subordinated debt securities then outstanding
plus accrued and unpaid interest to the date fixed for redemption. (Section 11.8
of the Trenwick America subordinated indenture)
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For purposes of the Trenwick America subordinated indenture, "investment
company event" means, in respect of a trust, the receipt by such trust of an
opinion of independent counsel experienced in such matters to the effect that,
as a result of the occurrence of a change in law or regulation or a change in
the interpretation or application of law or regulation by any legislative body,
court or governmental agency or regulatory authority, such trust is or will be
considered an investment company that is required to be registered under the
Investment Company Act, which change becomes effective on or after the date of
original issuance of the preferred securities of such trust. (Section 1.1 of the
Trenwick America subordinated indenture)
For purposes of the Trenwick America subordinated indenture, "tax event"
means, in respect of a trust, the receipt by us of an opinion of independent
counsel experienced in such matters to the effect that, as a result of any
amendment to, or change (including any announced prospective change) in, the
laws (or any regulation thereunder) of the U.S. or any political subdivision or
taxing authority thereof or therein, or as a result of any official
administrative pronouncement or judicial decision interpreting or applying such
laws or regulations, which amendment or change is effective or which
pronouncement or decision is announced on or after the date of original issuance
of the preferred securities of such trust, there is more than an insubstantial
risk that (i) such trust is, or will be within 90 days of the date of such
opinion, subject to United States federal income tax with respect to income
received or accrued on the corresponding series of Trenwick America subordinated
debt securities, (ii) interest payable by us on such subordinated debt
securities is not, or within 90 days of the date of such opinion will not be,
deductible by us, in whole or in part, for United States federal income tax
purposes or (iii) such trust is, or will be within 90 days of the date of such
opinion, subject to more than a de minimus amount of other taxes, duties or
other governmental charges. (Section 1.1 of the Trenwick America subordinated
indenture)
Notice of any redemption will be mailed at least 30 days but not more than
60 days before the redemption date to each holder of Trenwick America
subordinated debt securities to be redeemed at its registered address. Unless we
default in payment of the redemption price, on and after the redemption date
interest will cease to accrue on the subordinated debt securities or portions
thereof called for redemption.
Covenants Applicable to Senior Debt Securities Issued to a Trust
Limitation on Liens on Stock of Designated Subsidiaries
Under the Trenwick America senior indenture, each of Trenwick America and
Trenwick will covenant that, so long as any senior debt securities are
outstanding, it will not, nor will it permit any of its subsidiaries to, create,
assume, incur, guarantee or otherwise permit to exist any "indebtedness" (as
described in this document) secured by any mortgage, pledge, lien, security
interest or other encumbrance upon any shares of capital stock of any
"designated subsidiary" (whether such shares are now owned or hereafter
acquired) without effectively providing concurrently that the Trenwick America
senior debt securities (and, if Trenwick America and Trenwick so elect, any
other Indebtedness of Trenwick America that is not subordinate to the Trenwick
America senior debt securities and with respect to which the governing
instruments require, or pursuant to which Trenwick America is otherwise
obligated, to provide such security) will be secured equally and ratably with
such Indebtedness for at least the time period such other Indebtedness is so
secured. (Section 10. 5 of the Trenwick America senior indenture)
For purposes of the Trenwick America senior indenture, "share capital" of
any Person means any and all shares, interests, rights to purchase, warrants,
options, participations or other equivalents of or interests in (however
designated) equity of such Person, including preferred shares, but excluding any
debt securities convertible into such equity. (Section 1.1 of the Trenwick
America senior indenture)
The term "designated subsidiary" means any present or future consolidated
subsidiary of Trenwick, the Consolidated Net Worth of which constitutes at least
5% of Trenwick's consolidated net worth. (Section 1.1 of the Trenwick America
senior indenture). As of December 31, 2000, Trenwick's designated subsidiaries
were Trenwick (Barbados) Ltd., Trenwick America Corporation, Trenwick America
Reinsurance Corporation, Canterbury Financial Group Inc., Chartwell Insurance
Company, The Insurance
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Corporation of New York, Trenwick Holdings Limited, Trenwick International
Limited, LaSalle Re Holdings Limited and LaSalle Re Limited.
For purposes of the indentures, the term "indebtedness" means, with respect
to any person (as defined in the indenture), (1) the principal of and any
premium and interest on (a) indebtedness of such person for money borrowed and
(b) indebtedness evidenced by notes, debentures, bonds or other similar
instruments for the payment of which such person is responsible or liable; (2)
all capitalized lease obligations (as defined in the indenture) of such person;
(3) all obligations of such person issued or assumed as the deferred purchase
price of property, all conditional sale obligations and all obligations under
any title retention agreement (but excluding trade accounts payable arising in
the ordinary course of business); (4) all obligations of such person for the
reimbursement of any obligor on any letter of credit, banker's acceptance or
similar credit transaction (other than obligations with respect to letters of
credit securing obligations (other than obligations described in (1) through (3)
above) entered into in the ordinary course of business of such person to the
extent such letters of credit are not drawn upon or, if and to the extent drawn
upon, such drawing is reimbursed no later than the third business day (as
defined in the indenture) following receipt by such person of a demand for
reimbursement following payment on the letter of credit); (5) all obligations of
the type referred to in clauses (1) through (4) of other persons and all
dividends of other persons for the payment of which, in either case, such person
is responsible or liable as obligor, guarantor or otherwise; (6) all obligations
of the type referred to in clauses (1) through (5) of other persons secured by
any mortgage, pledge, lien, security interest or other encumbrance on any
property or asset of such person (whether or not such obligation is assumed by
such person), the amount of such obligation being deemed to be the lesser of the
value of such property or assets or the amount of the obligation so secured; and
(7) any amendments, modifications, refundings, renewals or extensions of any
indebtedness or obligation described as Indebtedness in clauses (1) through (6)
above. (Section 1.1 of the Trenwick America indentures)
Limitations on Disposition of Stock of Designated Subsidiaries
The Trenwick America senior indenture also provides that so long as any
Trenwick America senior debt securities are outstanding and except in a
transaction otherwise governed by such indenture, neither Trenwick America nor
Trenwick will issue, sell, assign, transfer or otherwise dispose of any shares
of, securities convertible into, or warrants, rights or options to subscribe for
or purchase shares of, capital stock (other than preferred stock having no
voting rights of any kind) of any designated subsidiary, and will not permit any
designated subsidiary to issue (other than to Trenwick America or Trenwick) any
shares (other than director's qualifying shares) of, or securities convertible
into, or warrants, rights or options to subscribe for or purchase shares of,
capital stock (other than preferred stock having no voting rights of any kind)
of any designated subsidiary, if, after giving effect to any such transaction
and the issuance of the maximum number of shares issuable upon the conversion or
exercise of all such convertible securities, warrants, rights or options,
Trenwick would own, directly or indirectly, less than 80% of the shares of
capital stock of such designated subsidiary (other than preferred stock having
no voting rights of any kind); provided, however, that (1) any issuance, sale,
assignment, transfer or other disposition permitted by Trenwick America or
Trenwick may only be made for at least a fair market value consideration as
determined by the board of directors of Trenwick America or Trenwick, as the
case may be, pursuant to a resolution adopted in good faith and (2) the
foregoing shall not prohibit any such issuance or disposition of securities if
required by any law or any regulation or order of any governmental or insurance
regulatory authority. Notwithstanding the foregoing, (1) Trenwick America or
Trenwick, as the case may be, may merge or consolidate any designated subsidiary
into or with another direct or indirect "subsidiary" (as described in this
document) of Trenwick, the shares of capital stock of which Trenwick owns at
least 80%, and (2) Trenwick America or Trenwick, as the case may be, may,
subject to the provisions described under "Consolidation, Amalgamation, Merger
and Sale of Assets" below, sell, assign, transfer or otherwise dispose of the
entire capital stock of any designated subsidiary at one time for at least a
fair market value consideration as determined by the board of directors of
Trenwick America or Trenwick, as the case may be, pursuant to a resolution
adopted in good faith. (Section 10.6 of the Trenwick America senior indenture)
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Covenants Applicable to Subordinated Debt Securities Issued to a Trust
Each of Trenwick and Trenwick America will also covenant, as to each series
of subordinated debt securities issued to a trust in connection with the
issuance of preferred securities and common securities by that trust, that it
will not permit any of its subsidiaries to, (1) redeem or make a liquidation
payment with respect to, any of the outstanding share capital of Trenwick
America or Trenwick, as the case may be, or (2) make any payment of principal
of, or interest or premium, if any, on or repay, repurchase or redeem any debt
security of Trenwick America or Trenwick that ranks junior in interest to the
subordinated debt securities of such series or the Trenwick guarantee in respect
thereof, as the case may be, or make any guarantee payments with respect to any
guarantee by Trenwick America or Trenwick, as the case may be, of the debt
securities of any subsidiary of Trenwick America or Trenwick, as the case may
be, if such guarantee ranks junior in interest to the Trenwick America
subordinated debt securities of such series or the Trenwick guarantee in respect
thereof, as the case may be (other than (a) dividends or distributions on the
share capital of Trenwick America paid or made to Trenwick and dividends or
distributions in common stock of Trenwick America or common shares of Trenwick,
as the case may be, (b) redemptions or purchases of any rights outstanding under
a shareholder rights plan of Trenwick America or Trenwick, as the case may be,
or the declaration of a dividend of such rights or the issuance of stock under
such plans in the future, (c) payments under any preferred securities guarantee
and (d) purchases of common shares related to the issuance of common stock or
common shares under any of Trenwick America's or Trenwick's benefit plans for
its directors, officers or employees) if at such time (i) there shall have
occurred any event of which Trenwick America or Trenwick has actual knowledge
that (A) with the giving of notice or lapse of time or both would constitute an
event of default and (B) in respect of which Trenwick America or Trenwick, as
the case may be, shall not have taken reasonable steps to cure, (ii) Trenwick
shall be in default with respect to its payment of any obligations under the
preferred securities guarantee relating to such related preferred securities or
(iii) Trenwick America shall have given notice of its election to begin an
"extension period" as provided in the Trenwick America subordinated indenture
with respect to the Trenwick America subordinated debt securities of such series
and shall not have rescinded such notice, or such extension period, or any
extension thereof, shall be continuing. (Section 10.10 of the Trenwick America
subordinated indenture)
In the event our subordinated debt securities are issued to a trust in
connection with the issuance of preferred securities and common securities of
such trust, for so long as such series of subordinated debt securities remain
outstanding, Trenwick America will also covenant (1) to maintain directly or
indirectly 100% ownership of the common securities of such trust; provided,
however, that any permitted successor of Trenwick America under the applicable
subordinated indenture may succeed to Trenwick America's ownership of such
common securities, (2) not to voluntarily dissolve, wind-up or liquidate such
trust, except in connection with the distribution of Trenwick America
subordinated debt securities to the holders of preferred securities and common
securities in liquidation of such trust, the redemption of all of the preferred
securities and common securities of such trust, or certain mergers,
consolidations or amalgamations, each as permitted by the trust agreement of
such trust, and (3) to use our reasonable efforts, consistent with the terms of
the related trust agreement, to cause such trust to remain classified as a
grantor trust for United States federal income tax purposes. (Section 10.12 of
the Trenwick America subordinated indenture)
Consolidation, Amalgamation, Merger and Sale of Assets
Each Trenwick America indenture provides that Trenwick America may not (1)
consolidate or amalgamate with or merge into any person or convey, transfer or
lease its properties and assets as an entirety or substantially as an entirety
to any person, or (2) permit any person to consolidate or amalgamate with or
merge into Trenwick America, or convey, transfer or lease its properties and
assets as an entirety or substantially as an entirety to Trenwick America,
unless (a) in the case of (1) above, such person is a corporation organized and
existing under the laws of the United States of America, any State thereof or
the District of Columbia and will expressly assume, by supplemental indenture
satisfactory in form to the trustee, the due and punctual payment of the
principal of, any premium and interest on and
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any additional amounts with respect to all of the debt securities issued
thereunder, and the performance of Trenwick America's obligations under such
Trenwick America indenture and the debt securities issued thereunder, and
provides for conversion or exchange rights in accordance with the provisions of
the debt securities of any series that are convertible or exchangeable into
ordinary shares or other securities; (b) immediately after giving effect to such
transaction and treating any indebtedness which becomes an obligation of
Trenwick America or a subsidiary as a result of such transaction as having been
incurred by Trenwick America or such subsidiary at the time of such transaction,
no event of default, and no event which after notice or lapse of time or both
would become an event of default, shall have happened and be continuing; and (c)
certain other conditions are met. (Section 8.1 of the Trenwick America
indentures)
Each Trenwick America indenture provides that Trenwick may not (1)
consolidate or amalgamate with or merge into any person or convey, transfer or
lease its properties and assets as an entirety or substantially as an entirety
to any person, or (2) permit any person to consolidate or amalgamate with or
merge into Trenwick, or convey, transfer or lease its properties and assets as
an entirety or substantially as an entirety to Trenwick, unless (a) in the case
of (1) above, such person is a corporation organized and existing under the laws
of the United States of America, any State thereof or the District of Columbia
or Bermuda and will expressly assume, by supplemental indenture satisfactory in
form to the trustee, the due and punctual payment of the principal of, any
premium and interest on and any additional amounts with respect to all of the
debt securities issued thereunder, and the performance of Trenwick's obligations
under such Trenwick America indenture and the debt securities issued thereunder;
(b) immediately after giving effect to such transaction and treating any
indebtedness which becomes an obligation of Trenwick or a subsidiary as a result
of such transaction as having been incurred by Trenwick or such subsidiary at
the time of such transaction, no event of default, and no event which after
notice or lapse of time or both would become an event of default, shall have
happened and be continuing; and (c) certain other conditions are met. (Section
8.3 of the Trenwick America indentures)
Events of Default
Each of the following events will constitute an "event of default" under
the applicable Trenwick America indenture with respect to any series of debt
securities issued thereunder (whatever the reason for such event of default and
whether it shall be voluntary or involuntary or be effected by operation of law
or pursuant to any judgment, decree or order of any court or any order, rule or
regulation of any administrative or governmental body):
(1) default in the payment of any interest on any debt security of
such series, or any additional amounts payable with respect thereto, when
such interest becomes or such additional amounts become due and payable,
and continuance of such default for a period of 30 days;
(2) default in the payment of the principal of or any premium on any
debt security of such series, or any additional amounts payable with
respect thereto, when such principal or premium becomes or such additional
amounts become due and payable either at maturity, upon any redemption, by
declaration of acceleration or otherwise;
(3) default in the deposit of any sinking fund payment, when and as
due by the terms of any debt security of such series;
(4) default in the performance, or breach, of any covenant or warranty
of Trenwick America or Trenwick contained in the applicable Trenwick
America indenture for the benefit of such series or in the debt securities
of such series, and the continuance of such default or breach for a period
of 60 days after there has been given written notice as provided in such
Trenwick America indenture;
(5) if any event of default as defined in any mortgage, indenture or
instrument under which there may be issued, or by which there may be
secured or evidenced, any "indebtedness" of Trenwick America or Trenwick
(including an event of default under any other series of Trenwick America
debt securities), whether such indebtedness now exists or is hereafter
created or incurred, happens and consists of default in the payment of more
than $50,000,000 in principal amount of such indebtedness
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at the maturity thereof (after giving effect to any applicable grace
period) or results in such indebtedness in principal amount in excess of
$50,000,000 becoming or being declared due and payable prior to the date on
which it would otherwise become due and payable, and such default is not
cured or such acceleration is not rescinded or annulled within a period of
30 days after there has been given written notice as provided in the
applicable Trenwick America indenture;
(6) Trenwick America or Trenwick shall fail within 60 days to pay,
bond or otherwise discharge any uninsured judgment or court order for the
payment of money in excess of $50,000,000, which is not stayed on appeal or
is not otherwise being appropriately contested in good faith;
(7) certain events in our bankruptcy, insolvency or reorganization;
and
(8) any other event of default provided in or pursuant to the
applicable Trenwick America indenture with respect to the debt securities
of such series. (Section 5.1 of the Trenwick America indentures)
If an event of default with respect to the debt securities of any series
(other than an event of default described in (7) of the preceding paragraph)
occurs and is continuing, either the trustee or the holders of at least 25% in
principal amount of the outstanding debt securities of such series by written
notice as provided in the applicable Trenwick America indenture may declare the
principal amount (or such lesser amount as may be provided for in the debt
securities of such series) of all outstanding debt securities of such series to
be due and payable immediately. In the case of an event of default with respect
to a series of subordinated debt securities issued to a trust, if the trustee or
such holders fail to declare such principal amount (or lesser amount) to be due
and payable immediately, the holders of at least 25% in liquidation amount of
the outstanding preferred securities of the trust may do so by written notice as
provided in the subordinated indenture. At any time after a declaration of
acceleration has been made, but before a judgment or decree for payment of money
has been obtained by the trustee, and subject to applicable law and certain
other provisions of the applicable Trenwick America indenture, the holders of
not less than a majority in principal amount of the outstanding debt securities
of such series may, under certain circumstances, rescind and annul such
declaration of acceleration. In the case of a series of subordinated debt
securities issued to a trust, if such holders fail to rescind and annul such
declaration, the holders of a majority in liquidation amount of the outstanding
preferred securities of such trust may, subject to satisfaction of certain
conditions, rescind and annul such declaration by written notice as provided in
the Trenwick America subordinated indenture. An event of default described in
(7) of the preceding paragraph will cause the principal amount and accrued
interest (or such lesser amount as provided for in the debt securities of such
series) to become immediately due and payable without any declaration or other
act by the trustee or any holder. (Section 5.2 of the Trenwick America
indentures)
Each Trenwick America indenture provides that, within 90 days after the
occurrence of any event which is, or after notice or lapse of time or both would
become, an event of default with respect to the Trenwick America debt securities
of any series (a "default"), the trustee must transmit, in the manner set forth
in such Trenwick America indenture, notice of such default to the holders of the
Trenwick America debt securities of such series unless such default has been
cured or waived; provided, however, that except in the case of a default in the
payment of principal of, or premium, if any, or interest, if any, on, or
additional amounts or any sinking fund or purchase fund installment with respect
to, any Trenwick America debt security of such series, the trustee may withhold
such notice if and so long as the board of directors, the executive committee or
a trust committee of directors and/or responsible officers of the trustee in
good faith determine that the withholding of such notice is in the best interest
of the holders of Trenwick America debt securities of such series; and provided,
further, that in the case of any default of the character described in (5) of
the second preceding paragraph, no such notice to holders will be given until at
least 30 days after the default occurs. (Section 6.2 of the Trenwick America
indentures)
If an event of default occurs and is continuing with respect to the debt
securities of any series, the trustee may in its discretion proceed to protect
and enforce its rights and the rights of the holders of the debt securities of
such series by all appropriate judicial proceedings. (Section 5.3 of the
Trenwick America indentures) Each Trenwick America indenture provides that,
subject to the duty of the trustee during any
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default to act with the required standard of care, the trustee will be under no
obligation to exercise any of its rights or powers under such Trenwick America
indenture at the request or direction of any of the holders of debt securities,
unless such holders shall have offered to the trustee reasonable indemnity.
(Section 6.1 of the Trenwick America indentures) Subject to such provisions for
the indemnification of the trustee, and subject to applicable law and certain
other provisions of the applicable Trenwick America indenture, the holders of a
majority in principal amount of the outstanding debt securities of any series
will have the right to direct the time, method and place of conducting any
proceeding for any remedy available to the trustee, or exercising any trust or
power conferred on the trustee, with respect to the Trenwick America debt
securities of such series. (Section 5.12 of the Trenwick America indentures)
Modification and Waiver
Trenwick, Trenwick America and the trustee may modify or amend either
Trenwick America indenture with the consent of the holders of not less than a
majority in principal amount of the outstanding debt securities of each series
affected thereby; provided, however, that no such modification or amendment may,
without the consent of the holder of each outstanding debt security affected
thereby,
- change the stated maturity of the principal of, or any premium or
installment of interest on, or any additional amounts with respect to,
any debt security,
- reduce the principal amount of, or the rate (or modify the calculation of
such rate) of interest on, or any additional amounts with respect to, or
any premium payable upon the redemption of, any debt security,
- change the obligation of Trenwick America to pay additional amounts with
respect to any debt security,
- reduce the amount of the principal of an original issue discount security
that would be due and payable upon a declaration of acceleration of the
maturity thereof or the amount thereof provable in bankruptcy,
- change the redemption provisions of any debt security or adversely affect
the right of repayment at the option of any holder of any debt security,
- change the place of payment or the coin or currency in which the
principal of, any premium or interest on or any additional amounts with
respect to any debt security is payable,
- impair the right to institute suit for the enforcement of any payment on
or after the stated maturity of any debt security (or, in the case of
redemption, on or after the redemption date or, in the case of repayment
at the option of any holder, on or after the repayment date),
- reduce the percentage in principal amount of the outstanding debt
securities, the consent of whose holders is required in order to take
specific actions,
- reduce the requirements for quorum or voting by holders of debt
securities in Section 15.4 of each Trenwick America indenture,
- modify any of the provisions of the Trenwick subordinated indenture
relating to the subordination of the debt securities or the Trenwick
guarantee in a manner adverse to the holders of the subordinated debt
securities,
- modify or effect in any manner adverse to the holders of debt securities
the terms and conditions of the obligations of Trenwick in respect of the
due and punctual payment of principal of, or any premium or interest on,
or any sinking fund requirements or additional amounts with respect to,
the debt securities,
- modify any of the provisions in the applicable Trenwick America indenture
regarding the waiver of past defaults and the waiver of certain covenants
by the holders of debt securities except to increase any percentage vote
required or to provide that other provisions of such Trenwick America
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indenture cannot be modified or waived without the consent of the holder
of each debt security affected thereby,
- make any change that adversely affects the rights to convert or exchange
any debt security into or for securities of Trenwick or Trenwick America
or other securities, cash or property, or
- modify any of the above provisions. (Section 9.2 of the Trenwick America
indentures)
In addition, no supplemental indenture may directly or indirectly modify or
eliminate the subordination provisions of the subordinated indenture in any
manner which might terminate or impair the subordination of the subordinated
debt securities of any series to "senior indebtedness" (as described in this
document) with respect to such series or the subordination of the guarantee with
respect to the subordinated debt securities of any series to senior indebtedness
with respect to such series, without the prior written consent of the holders of
such senior indebtedness or such senior indebtedness, respectively. (Section 9.7
of the Trenwick America subordinated indenture).
Trenwick America and the trustee may modify or amend either Trenwick
America indenture and the debt securities of any series without the consent of
any holder, among other things, to:
- provide for a successor to Trenwick America or Trenwick pursuant to a
consolidation, amalgamation, merger or sale of assets;
- add to the covenants of Trenwick America or Trenwick for the benefit of
the holders of all or any series of debt securities or to surrender any
right or power conferred upon Trenwick America or Trenwick by the
applicable Trenwick America indenture;
- provide for a successor trustee with respect to the debt securities of
all or any series;
- cure any ambiguity or correct or supplement any provision in either
Trenwick America indenture which may be defective or inconsistent with
any other provision, or to make any other provisions with respect to
matters or questions arising under either Trenwick America indenture
which will not adversely affect the interests of the holders of debt
securities of any series issued pursuant thereto;
- change the conditions, limitations and restrictions on the authorized
amount, terms or purposes of issue, authentication and delivery of debt
securities under either Trenwick America indenture;
- add any additional events of default with respect to all or any series of
debt securities;
- secure the debt securities; or
- make any other change that does not materially adversely affect the
interests of the holders of any debt securities then outstanding under
the applicable Trenwick America indenture. (Section 9.1 of the Trenwick
America indentures)
The holders of at least a majority in aggregate principal amount of the
outstanding debt securities of any series may, on behalf of the holders of all
debt securities of that series, waive compliance by Trenwick America and/or
Trenwick with certain covenants of the applicable Trenwick America indenture.
(Section 10.8 of the Trenwick America senior indenture; Section 10.6 of the
Trenwick America subordinated indenture) The holders of not less than a majority
in aggregate principal amount of the outstanding debt securities of any series
may, on behalf of the holders of all debt securities of that series and, in the
case of any subordinated debt securities issued to a trust, the holders of not
less than a majority in liquidation amount of the outstanding preferred
securities of the trust, may waive any past default and its consequences under
the applicable Trenwick America indenture with respect to the debt securities of
that series, except a default (1) in the payment of principal, any premium or
interest on or any additional amounts with respect to debt securities of that
series or (2) in respect of a covenant or provision of the applicable Trenwick
America indenture that cannot be modified or amended without the consent of the
holder of each outstanding debt security of any series affected. (Section 5.13
of the Trenwick America indentures)
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Under each Trenwick America indenture, Trenwick America is required to
furnish the trustee annually a statement as to the performance by Trenwick
America of certain of its obligations under that Trenwick America indenture and
as to any default in such performance. Trenwick America is also required to
deliver to the trustee, within five days after occurrence thereof, written
notice of any event of default or any event which after notice or lapse of time
or both would constitute an event of default, resulting from the failure to
perform or breach of any covenant or warranty contained in the applicable
Trenwick America indenture or the debt securities of any series. (Sections 10.9
and 10.10 of the Trenwick America senior indenture; Sections 10.7 and 10.8 of
the Trenwick America subordinated indenture)
Discharge, Defeasance and Covenant Defeasance
Trenwick America may discharge certain obligations to holders of any series
of debt securities that have not already been delivered to the trustee for
cancellation and that either have become due and payable or will become due and
payable within one year (or scheduled for redemption within one year) by
depositing with the trustee, in trust, funds in U.S. dollars or in the "foreign
currency" (as described in this document) in which such debt securities are
payable in an amount sufficient to pay the entire indebtedness on such debt
securities with respect to principal and any premium, interest and additional
amounts to the date of such deposit (if such debt securities have become due and
payable) or to the maturity thereof, as the case may be. (Section 4.1 of the
Trenwick America indentures)
Each Trenwick America indenture provides that, unless the provisions of
Section 4.2 thereof are made inapplicable to the debt securities of or within
any series pursuant to Section 3.1 thereof, Trenwick America may elect either
(1) to defease and be discharged from any and all obligations with respect to
such debt securities (except for, among other things, the obligation to pay
additional amounts upon the occurrence of certain events of taxation, assessment
or governmental charge with respect to payments on such debt securities and
other obligations to register the transfer or exchange of such debt securities,
to replace temporary or mutilated, destroyed, lost or stolen debt securities, to
maintain an office or agency with respect to such Trenwick America debt
securities and to hold moneys for payment in trust) ("defeasance") or (2) to be
released from its obligations with respect to such debt securities under certain
covenants as described in the related prospectus supplement, and any omission to
comply with such obligations shall not constitute a default or an event of
default with respect to such debt securities ("covenant defeasance"). Defeasance
or covenant defeasance, as the case may be, shall be conditioned upon the
irrevocable deposit by Trenwick with a trustee, in trust, of an amount in U.S.
dollars or in the foreign currency in which such debt securities are payable at
stated maturity, or "government obligations" (as described in this document) (as
defined below), or both, applicable to such debt securities which through the
scheduled payment of principal and interest in accordance with their terms will
provide money in an amount sufficient to pay the principal of, any premium and
interest on, and any additional amounts with respect to, such debt securities on
the scheduled due dates. (Section 4.2 of the Trenwick America indentures)
Such a trust may only be established if, among other things, (1) the
applicable defeasance or covenant defeasance does not result in a breach or
violation of, or constitute a default under, the applicable Trenwick America
indenture or any other material agreement or instrument to which Trenwick is a
party or by which we are bound, (2) no event of default or event which with
notice or lapse of time or both would become an event of default with respect to
the debt securities to be defeased shall have occurred and be continuing on the
date of establishment of such a trust and, with respect to defeasance only, at
any time during the period ending on the 123rd day after such date and (3)
Trenwick has delivered to the trustee an opinion of counsel (as specified in the
Trenwick America indenture) to the effect that the holders of such debt
securities will not recognize income, gain or loss for United States federal
income tax purposes as a result of such defeasance or covenant defeasance and
will be subject to United States federal income tax on the same amounts, in the
same manner and at the same times as would have been the case if such defeasance
or covenant defeasance had not occurred, and such opinion of counsel, in the
case of defeasance, must refer to and be based upon a letter ruling of the
Internal Revenue Service received by Trenwick, a Revenue Ruling published by the
Internal Revenue Service or a change in
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applicable United States federal income tax law occurring after the date of the
applicable Trenwick America indenture. (Section 4.2 of the Trenwick America
indentures)
"Foreign currency" means any currency, currency unit or composite currency,
including, without limitation, the euro, issued by the government of one or more
countries other than the United States of America or by any recognized
confederation or association of such governments. (Section 1.1 of the Trenwick
America indentures)
"Government obligations" means debt securities which are (1) direct
obligations of the United States of America or the government or the governments
which issued the foreign currency in which the Trenwick America debt securities
of a particular series are payable, for the payment of which its full faith and
credit is pledged or (2) obligations of a person controlled or supervised by and
acting as an agency or instrumentality of the United States of America or such
government or governments which issued the foreign currency in which the
Trenwick America debt securities of such series are payable, the timely payment
of which is unconditionally guaranteed as a full faith and credit obligation by
the United States of America or such other government or governments, and which,
in the case of clauses (1) and (2), are not callable or redeemable at the option
of the issuer or issuers thereof, and shall also include a depository receipt
issued by a bank or trust company as custodian with respect to any such
government obligation or a specific payment of interest on or principal of or
any other amount with respect to any such government obligation held by such
custodian for the account of the holder of such depository receipt, provided
that (except as required by law) such custodian is not authorized to make any
deduction from the amount payable to the holder of such depository receipt from
any amount received by the custodian with respect to the government obligation
or the specific payment of interest on or principal of or any other amount with
respect to the government obligation evidenced by such depository receipt.
(Section 1.1 of the Trenwick America indentures)
If after Trenwick has deposited funds and/or government obligations to
effect defeasance or covenant defeasance with respect to debt securities of any
series, (1) the holder of a debt security of that series is entitled to, and
does, elect pursuant to Section 3.1 of the applicable Trenwick America indenture
or the terms of such debt security to receive payment in a currency other than
that in which such deposit has been made in respect of such debt security, or
(2) a "conversion event" (as defined below) occurs in respect of the foreign
currency in which such deposit has been made, the indebtedness represented by
such debt security will be deemed to have been, and will be, fully discharged
and satisfied through the payment of the principal of, any premium and interest
on, and any additional amounts with respect to, such debt security as such debt
security becomes due out of the proceeds yielded by converting the amount or
other properties so deposited in respect of such debt security into the currency
in which such debt security becomes payable as a result of such election or such
conversion event based on (a) in the case of payments made pursuant to clause
(1) above, the applicable market exchange rate for such currency in effect on
the second business day prior to such payment date, or (b) with respect to a
conversion event, the applicable market exchange rate for such foreign currency
in effect (as nearly as feasible) at the time of the conversion event. (Section
4.2 of the Trenwick America indentures)
"Conversion event" means the cessation of use of (1) a foreign currency
both by the government of the country or countries which issued such foreign
currency and for the settlement of transactions by a central bank or other
public institutions of or within the international banking community or (2) any
currency unit or composite currency for the purposes for which it was
established. All payments of principal of, any premium and interest on, and any
additional amounts with respect to, any debt security that are payable in a
foreign currency that ceases to be used by the government or governments of
issuance shall be made in U.S. dollars. (Section 1.1 of the Trenwick America
indentures)
In the event Trenwick effects covenant defeasance with respect to any debt
securities and such debt securities are declared due and payable because of the
occurrence of any event of default other than an event of default with respect
to any covenant as to which there has been covenant defeasance, the amount in
such foreign currency in which such debt securities are payable, and government
obligations on deposit with the trustee, will be sufficient to pay amounts due
on such debt securities at the time of the stated
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maturity but may not be sufficient to pay amounts due on such debt securities at
the time of the acceleration resulting from such event of default. However,
Trenwick would remain liable to make payment of such amounts due at the time of
acceleration.
Subordination of the Subordinated Debt Securities
The subordinated debt securities of each series will, to the extent set
forth in the Trenwick America subordinated indenture, be subordinate in right of
payment to the prior payment in full of all Senior Indebtedness with respect to
such series. (Section 16.1 of the Trenwick America subordinated indenture). Upon
any payment or distribution of assets of Trenwick America of any kind or
character, whether in cash, property or securities, to creditors, upon any
dissolution, winding up, liquidation or reorganization of Trenwick America,
whether voluntary or involuntary or in bankruptcy insolvency, receivership or
other proceedings, all amounts due upon all senior indebtedness with respect to
subordinated debt securities of any series first be paid in full, or payment
thereof provided for in money in accordance with it terms, before the holders of
subordinated debt securities of such series are entitled to receive or retain
any payment on account of principal of, or any premium or interest on, or any
additional amounts with respect to, the subordinated debt securities of such
series, and to that end the holders of such senior indebtedness shall be
entitled to receive, for application to the payment thereof, any payment or
distribution of any kind or character, whether in cash, property or securities,
including any such payment or distribution which may be payable or deliverable
by reason of the payment of any other indebtedness of Trenwick America being
subordinated to the payment of Trenwick America subordinated debt securities of
such series, which may be payable or deliverable in respect of the Trenwick
America subordinated debt securities of such series upon any such dissolution,
winding-up, liquidation or reorganization or in any such bankruptcy, insolvency,
receivership or other proceeding. (Section 16.3 of the Trenwick America
subordinated indenture)
By reason of such subordination, in the event of liquidation or insolvency
of Trenwick America, holders of Senior Indebtedness with respect to the
subordinated debt securities of any series and holders of other obligations of
Trenwick America that are not subordinated to such senior indebtedness may
recover more, ratably, than the holders of the subordinated debt securities of
such series.
Subject to the payment in full of all senior indebtedness with respect to
the subordinated debt securities of any series, the rights of the holders of the
subordinated debt securities of such series will be subrogated to the rights of
the holders of such senior indebtedness to receive payments or distributions of
cash, property or securities of Trenwick America applicable to such senior
indebtedness until the principal of, any premium and interest on, and any
additional amounts with respect to, the subordinated debt securities of such
series have been paid in full. (Section 16.4 of the Trenwick America
subordinated indenture)
No payment of principal (including redemption and sinking fund payments) of
or any premium or interest on or any additional amounts with respect to the
subordinated debt securities may be made (1) if any senior indebtedness of
Trenwick America is not paid when due and any applicable grace period with
respect to such default has ended and such default has not been cured or waived
or ceased to exist, or (2) if the maturity of any senior indebtedness of
Trenwick America has been accelerated because of a default. (Section 16.2 of the
Trenwick America subordinated indenture)
The Trenwick America subordinated indenture does not limit or prohibit
Trenwick America from incurring additional senior indebtedness, which may
include Indebtedness that is senior to the subordinated debt securities, but
subordinate to other obligations of Trenwick America. The senior debt securities
will constitute senior indebtedness under the Trenwick America subordinated
indenture.
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The term "senior indebtedness" means, with respect to the subordinated debt
securities of any particular series, all Indebtedness of Trenwick America
outstanding at any time, except:
(1) the subordinated debt securities of such series,
(2) indebtedness (as described in this document) as to which, by the
terms of the instrument creating or evidencing the same, it is provided
that such Indebtedness is subordinated to or ranks equally with the
Trenwick America subordinated debt securities of such series,
(3) indebtedness (as described in this document) of Trenwick America
to an affiliate of Trenwick America,
(4) interest accruing after the filing of a petition initiating any
bankruptcy, insolvency or other similar proceeding unless such interest is
an allowed claim enforceable against Trenwick America in a proceeding under
federal or state bankruptcy laws,
(5) trade accounts payable, and
(6) any indebtedness (as described in this document), including all
other debt securities and guarantees in respect of those debt securities,
initially issued to (x) any trust or (y) any trust, partnership or other
entity affiliated with Trenwick which is a financing vehicle of Trenwick or
any affiliate of Trenwick in connection with an issuance by such entity of
preferred securities or other securities which are similar to the preferred
securities described under "Description of Preferred Securities" below that
are guaranteed by Trenwick pursuant to an instrument that ranks equally
with or junior in right of payment to preferred securities guarantees
described under "Description of Preferred Securities Guarantees" below.
Such senior indebtedness with respect to the subordinated debt securities
of any particular series shall continue to be senior indebtedness with respect
to the subordinated debt securities of such series and be entitled to the
benefits of the subordination provisions irrespective of any amendment,
modification or waiver of any term of such senior indebtedness. (Sections 1.1
and 16.8 of the Trenwick America subordinated indenture)
The Trenwick America subordinated indenture provides that the foregoing
subordination provisions, insofar as they relate to any particular series of
subordinated debt securities, may be changed prior to such issuance. Any such
change would be described in the related prospectus supplement.
Subordination of Trenwick Guarantee of Subordinated Debt Securities
The Trenwick guarantee of subordinated debt securities of each series will,
to the extent set forth in the Trenwick America subordinated indenture, be
subordinate in right of payment to the prior payment in full of all Trenwick
senior indebtedness with respect to such series. (Section 18.1 of the Trenwick
America subordinated indenture) Upon any payment or distribution of assets of
Trenwick of any kind or character, whether in cash, property or securities, to
creditors upon any dissolution, winding-up, liquidation or reorganization of
Trenwick, whether voluntary or involuntary, or in bankruptcy, insolvency,
receivership or other proceedings, all amounts due upon all Trenwick senior
indebtedness with respect to the subordinated debt securities of any series will
first be paid in full, or payment thereof provided for in money in accordance
with its terms, before the holders of subordinated debt securities of such
series are entitled to receive or retain any payment from Trenwick on account of
principal of, or any premium or interest on, or any additional amounts with
respect to, the subordinated debt securities of such series, and to that end the
holders of such Trenwick senior indebtedness shall be entitled to receive, for
application to the payment thereof, any payment or distribution by Trenwick of
any kind or character, whether in cash, property or securities, including any
such payment or distribution which may be payable or deliverable by Trenwick by
reason of the payment of any other indebtedness of Trenwick being subordinated
to the payment of subordinated debt securities of such series, which may be
payable or deliverable by Trenwick in respect of the subordinated debt
securities of such series upon any such dissolution, winding-up, liquidation or
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reorganization or in any such bankruptcy, insolvency, receivership or other
proceeding. (Section 18.3 of the Trenwick America subordinated indenture)
By reason of such subordination, in the event of liquidation or insolvency
of Trenwick, holders of Trenwick senior indebtedness with respect to the
subordinated debt securities of any series and holders of other obligations of
Trenwick that are not subordinated to such Trenwick senior indebtedness may
recover more, ratably, than the holders of the subordinated debt securities of
such series.
Subject to the payment in full of all Trenwick senior indebtedness with
respect to the subordinated debt securities of any series, the rights of the
holders of the subordinated debt securities of such series under the Trenwick
guarantee will be subrogated to the rights of the holders of such Trenwick
senior indebtedness to receive payments or distributions of cash, property or
securities of Trenwick applicable to such Trenwick senior indebtedness until the
principal of, any premium and interest on, and any additional amounts with
respect to, the subordinated debt securities of such series have been paid in
full. (Section 18.4 of the Trenwick America subordinated indenture)
No payment of principal (including redemption and sinking fund payments) of
or any premium or interest on or any additional amounts with respect to the
subordinated debt securities of any series may be made by Trenwick (i) if any
Trenwick senior indebtedness with respect to such series is not paid when due
and any applicable grace period with respect to such default has ended and such
default has not been cured or waived or ceased to exist, or (ii) if the maturity
of any Trenwick senior indebtedness with respect to such series has been
accelerated because of a default. (Section 18.2 of the Trenwick America
subordinated indenture)
The Trenwick America subordinated indenture does not limit or prohibit
Trenwick from incurring additional Trenwick Senior Indebtedness, which may
include Indebtedness that is senior to the Trenwick guarantee of the
subordinated debt securities of any series, but subordinate to other obligations
of Trenwick. The Trenwick senior debt securities will constitute "Trenwick
senior indebtedness" with respect to the subordinated debt securities of each
series under the Trenwick America subordinated indenture.
The term "Trenwick senior indebtedness" means, with respect to the
subordinated debt securities of any particular series, all indebtedness of
Trenwick outstanding at any time, except:
(1) Trenwick's obligations under the Trenwick guarantee in respect of
the subordinated debt securities of such series,
(2) Indebtedness as to which, by the terms of the instrument creating
or evidencing the same, it is provided that such indebtedness is
subordinated to or ranks equally with Trenwick's obligations under the
Trenwick guarantee in respect of the Trenwick subordinated debt securities
of such series,
(3) Indebtedness of Trenwick to an affiliate of Trenwick,
(4) Interest accruing after the filing of a petition initiating any
bankruptcy, insolvency or other similar proceeding unless such interest is
an allowed claim enforceable against Trenwick in a proceeding under federal
or state bankruptcy laws,
(5) Trade accounts payable,
(6) Trenwick's obligations under the Trenwick guarantee in respect of
the debt securities of any series initially issued to (x) any trust or (y)
any trust, partnership or other entity affiliated with Trenwick which is a
financing vehicle of Trenwick or any Affiliate of Trenwick in connection
with an issuance by such entity of preferred securities or other securities
which are similar to the preferred securities described under "Description
of Preferred Securities Guarantees" below that are guaranteed by Trenwick
pursuant to an instrument that ranks equally with a junior in right of
payment to the preferred securities guarantees described under "Description
of Preferred Securities Guarantees" below, and
(7) All preferred securities guarantees and all similar guarantees
issued by Trenwick on behalf of holders of preferred securities of a trust
or other similar preferred securities issued by any trust,
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partnership or other entity affiliated with Trenwick which is a financing
vehicle for Trenwick and any affiliate of Trenwick.
The Trenwick America subordinated indenture provides that the foregoing
subordination provisions, insofar as they relate to any particular series of
Trenwick America subordinated debt securities, may be changed prior to such
issuance. Any such change would be described in the applicable prospectus
supplement.
New York Law to Govern
The Trenwick America indentures, the Trenwick America debt securities and
the Trenwick guarantee will be governed by, and construed in accordance with,
the laws of the State of New York applicable to agreements made or instruments
entered into and, in each case, performed in that state. (Section 1.13 of the
Trenwick America indentures)
DESCRIPTION OF TRUST PREFERRED SECURITIES
Each trust will be governed by the terms of the applicable trust agreement.
Under the trust agreement of a trust, the trust may issue, from time to time,
only one series of preferred securities. The preferred securities will have the
terms set forth in the trust agreement or made a part of the trust agreement by
the Trust Indenture Act, and described in the related prospectus supplement.
These terms will mirror the terms of the Trenwick America subordinated debt
securities purchased by the trust using the proceeds from the sale of its
preferred securities and its common securities. The Trenwick America
subordinated debt securities issued to the trust will be guaranteed by Trenwick
on a subordinated basis and are referred to as the "corresponding subordinated
debt securities" relating to the trust. See "Use of Proceeds."
The following summary sets forth the material terms and provisions of each
trust agreement and the preferred securities to which any prospectus supplement
relates. Because this summary is not complete, you should refer to the form of
trust agreement and to the Trust Indenture Act for complete information
regarding the terms and provisions of that agreement and of the preferred
securities, including the definitions of some of the terms used below. The form
of trust agreement filed as an exhibit to the registration statement of which
this document forms a part is incorporated by reference in this summary.
Whenever particular sections or defined terms of a trust agreement are referred
to, those sections or defined terms are incorporated in this document by
reference, and the statements in connection with which such reference is made
are qualified in their entirety by such reference.
Issuance, Status and Guarantee of Preferred Securities
Under the terms of the trust agreement for each trust, the administrative
trustees will issue the preferred securities on behalf of that trust. The
preferred securities will represent preferred beneficial interests in the trust
and the holders of the preferred securities will be entitled to a preference in
certain circumstances as regards distributions and amounts payable on redemption
or liquidation over the common securities of such trust, as well as other
benefits under the corresponding trust agreement. The preferred securities of a
trust will rank equally, and payments will be made on the preferred securities
pro rata, with the common securities of that trust except as described under
"-- Subordination of Common Securities." The property trustee will hold legal
title to the corresponding subordinated debt securities in trust for the benefit
of the holders of the related preferred securities and common securities. The
common securities and the preferred securities of a trust are collectively
referred to as the "trust securities" of that trust.
Trenwick will issue a guarantee agreement for the benefit of the holders of
each trust's preferred securities which we refer to in this document as the
"preferred securities guarantee" for those preferred securities. Under each
preferred securities guarantee, Trenwick will guarantee on a subordinated basis
payment of distributions on the related preferred securities and amounts payable
on redemption or liquidation of such preferred securities, but only to the
extent that the related trust has funds on hand to make such payments. See
"Description of Preferred Securities Guarantees."
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Distributions
Distributions on the preferred securities will be cumulative, will
accumulate from the original issue date and will be payable on the dates as
specified in the related prospectus supplement. In the event that any date on
which distributions are payable on the preferred securities is not a business
day, payment of the distribution payable on such date will be made on the next
succeeding day that is a business day (and without any additional distributions
or other payment in respect of any such delay), except that, if such business
day is in the next succeeding calendar year, payment of such distribution shall
be made on the immediately preceding business day, in each case with the same
force and effect as if made on the date such payment was originally payable
(each date on which distributions are payable in accordance with the foregoing,
a "distribution date"). (Section 4.1 of the trust agreements) A "business day"
is any day other than a Saturday or a Sunday, or a day on which banking
institutions in the City of New York are authorized or required by law or
executive order to remain closed or a day on which the corporate trust office of
the property trustee or the trustee for the corresponding subordinated debt
securities is closed for business. (Section 1.1 of the trust agreements)
Distributions on each preferred security will be payable at a rate
specified in the related prospectus supplement. The amount of distributions
payable for any period will be computed on the basis of a 360-day year of twelve
30-day months unless otherwise specified in the related prospectus supplement.
Distributions to which holders of preferred securities are entitled will
accumulate additional distributions at the rate per annum if and as specified in
the related prospectus supplement. References to "distributions" include any
accumulated or additional distributions unless otherwise stated. (Section 4.1 of
the trust agreements)
If provided in the applicable prospectus supplement, Trenwick America has
the right under the subordinated indenture to defer the payment of interest at
any time or from time to time on any series of corresponding subordinated debt
securities for an Extension Period which will be specified in the related
prospectus supplement. No Extension Period may extend beyond the stated maturity
of the corresponding subordinated debt securities. See "Description of Debt
Securities and Trenwick Guarantee -- Option to Extend Interest Payment Date." As
a consequence of any such extension, distributions on the corresponding
preferred securities would be deferred (but would continue to accumulate
additional distributions at the rate per annum set forth in the prospectus
supplement for such preferred securities, which will match the interest rate
payable on the corresponding subordinated debt securities during the Extension
Period) by the trust which issued such preferred securities during any such
Extension Period. (Section 4.1 of the trust agreements)
The funds of each trust available for distribution to holders of its
preferred securities will be limited to payments under the corresponding
subordinated debt securities in which the trust will invest the proceeds from
the issuance and sale of its trust securities. If Trenwick America does not make
interest payments on those corresponding subordinated debt securities, the
property trustee will not have funds available to pay distributions on the
related preferred securities. The payment of distributions (if and to the extent
the trust has funds legally available for the payment of such distributions and
cash sufficient to make such payments) is guaranteed by Trenwick on a limited
basis as set forth herein under "Description of Preferred Securities
Guarantees."
Distributions on the preferred securities will be payable to the holders
thereof as they appear on the register of such trust on the relevant record
dates. As long as the preferred securities remain in book-entry form, the record
dates will be one Business Day prior to the relevant distribution dates. Subject
to any applicable laws and regulations and the provisions of the applicable
trust agreement, each distribution payment will be made as described under
"Global Preferred Securities." In the event any preferred securities are not in
book-entry form, the relevant record date for such preferred securities will be
the date at least 15 days prior to the relevant distribution date, as specified
in the related prospectus supplement. (Section 4.1 of the trust agreements)
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Redemption or Exchange
Mandatory Redemption. Upon any repayment or redemption, in whole or in
part, of any corresponding subordinated debt securities held by a trust, whether
at stated maturity, upon earlier redemption or otherwise, the proceeds from such
repayment or redemption shall simultaneously be applied by the property trustee,
upon not less than 30 nor more than 60 days notice to holders of trust
securities, to redeem, on a pro rata basis, preferred and common securities
having an aggregate stated liquidation amount equal to the aggregate principal
amount of the corresponding subordinated debt securities so repaid or redeemed.
The redemption price per trust security will be equal to the stated liquidation
amount thereof plus accumulated and unpaid distributions thereon to the date of
redemption, plus the related amount of premium, if any, and any additional
amounts paid by us upon the concurrent repayment or redemption of the
corresponding subordinated debt securities (the "redemption price"). (Section
4.2 of the trust agreements) If less than all of any series of corresponding
subordinated debt securities are to be repaid or redeemed on a redemption date,
then the proceeds from such repayment or redemption shall be allocated to the
redemption pro rata of the related preferred common securities. (Section 4.2 of
the trust agreements)
Trenwick America will have the right to redeem any series of corresponding
subordinated debt securities (1) at any time, in whole but not in part, upon the
occurrence of a special event (as described in this document) and subject to the
further conditions described under "Description of Debt Securities and Trenwick
Guarantee -- Redemption," or (2) as may be otherwise specified in the applicable
prospectus supplement.
Special Event Redemption or Distribution of Corresponding Subordinated Debt
Securities. If a special event relating to the preferred securities and common
securities of a trust shall occur and be continuing, Trenwick America has the
right to redeem the corresponding subordinated debt securities, in whole but not
in part, and thereby cause a mandatory redemption of such preferred securities
and common securities, in whole but not in part, at the redemption price within
90 days following the occurrence of the special event. At any time, Trenwick has
the right to dissolve the related trust and after satisfaction of the
liabilities of creditors of such trust as provided by applicable law, cause such
corresponding subordinated debt securities to be distributed to the holders of
such preferred and common securities in liquidation of the trust. If Trenwick
America does not elect to redeem the corresponding subordinated debt securities
upon the occurrence of a special event, the applicable preferred securities will
remain outstanding, and in the event a tax event has occurred and is continuing,
"additional sums" may be payable on the corresponding subordinated debt
securities. "Additional sums" means the additional amounts as may be necessary
in order that the amount of distributions then due and payable by a trust on the
outstanding preferred securities and common securities of the trust shall not be
reduced as a result of any additional taxes, duties and other governmental
charges to which such trust has become subject as a result of a tax event.
(Section 1.1 of the trust agreements)
On and from the date fixed for any distribution of corresponding
subordinated debt securities upon dissolution of a trust (1) the trust
securities will no longer be deemed to be outstanding, (2) the depositary or its
nominee, as the record holder of the applicable preferred securities, will
receive a registered global certificate or certificates representing the
corresponding subordinated debt securities to be delivered upon such
distribution, upon surrender of the related preferred securities certificates
for exchange and (3) any certificates representing such preferred securities not
so surrendered for exchange will be deemed to represent beneficial interests in
the corresponding subordinated debt securities having an aggregate principal
amount equal to the aggregate stated liquidation amount of such preferred
securities, and accruing interest at the rate provided for in such debt
securities (which will equal the distribution rate on the preferred securities)
until such certificates are presented to the administrative trustees or their
agent for exchange. (Section 9.4 of the trust agreements)
There can be no assurance as to the market prices for the preferred
securities or the corresponding subordinated debt securities that may be
distributed in exchange for preferred securities if a dissolution and
liquidation of a trust were to occur. Accordingly, the preferred securities that
you may purchase, or
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the corresponding subordinated debt securities that you may receive on
dissolution and liquidation of a trust, may trade at a discount to the price
that you paid to purchase the preferred securities.
Redemption Procedures
Preferred securities redeemed on each redemption date shall be redeemed at
the redemption price with the applicable proceeds from the contemporaneous
redemption of the corresponding subordinated debt securities. Redemptions of the
preferred securities shall be made and the redemption price shall be payable on
each redemption date only to the extent that the related trust has funds on hand
available for the payment of such redemption price. See also "-- Subordination
of Common Securities."
If a trust gives a notice of redemption (which notice will be irrevocable)
in respect of its preferred securities, then, by 12:00 noon, New York City time,
on the redemption date, to the extent funds are available, the property trustee
will deposit irrevocably with the depositary for the preferred securities funds
sufficient to pay the applicable redemption price and will give the depositary
irrevocable instructions and authority to pay the redemption price to the
holders of such preferred securities. If such preferred securities are no longer
in book-entry form, the property trustee, to the extent funds are available,
will irrevocably deposit with the paying agent for such preferred securities
funds sufficient to pay the applicable redemption price and will give such
paying agent irrevocable instructions and authority to pay the redemption price
to the holders thereof upon surrender of their certificates evidencing such
preferred securities. Notwithstanding the foregoing, distributions payable on or
prior to the redemption date for any preferred securities called for redemption
shall be payable to the holders of such preferred securities on the relevant
record dates for the related distribution dates. If notice of redemption shall
have been given and funds deposited as required, then immediately prior to the
close of business on the date of such deposit, all rights of the holders of such
preferred securities so called for redemption will cease, except the right of
the holders of such preferred securities to receive the redemption price, but
without interest, and such preferred securities will cease to be outstanding. In
the event that any date on which any redemption price is payable is not a
business day, then payment of the redemption price payable on such date will be
made on the next succeeding day which is a business day (and without any
interest or other payment in respect of any such delay), except that, if such
business day falls in the next calendar year, such payment will be made on the
immediately preceding business day, in each case with the same force and effect
as if made on such date. In the event that payment of the redemption price in
respect of preferred securities called for redemption is improperly withheld or
refused and not paid either by the trust or by Trenwick pursuant to the
preferred securities guarantee as described under "Description of Preferred
Securities Guarantees," distributions on such preferred securities will continue
to accumulate at the then applicable rate, from the redemption date originally
established by the trust for such preferred securities to the date such
redemption price is actually paid, in which case the actual payment date will be
the date fixed for redemption for purposes of calculating the redemption price.
Subject to applicable law (including, without limitation, United States
federal securities law), we or our subsidiaries may, including Trenwick America,
at any time and from time to time purchase outstanding preferred securities by
tender, in the open market or by private agreement and we or our subsidiaries
may exchange such preferred securities for Trenwick America's subordinated debt
securities.
Payment of the redemption price on the preferred securities shall be made
to the applicable recordholders as they appear on the register for such
preferred securities on the relevant record date, which shall be one business
day prior to the relevant redemption date; provided, however, that in the event
that any preferred securities are not in book-entry form, the relevant record
date for such preferred securities shall be a date at least 15 days prior to the
redemption date, as specified in the applicable prospectus supplement.
If less than all of the preferred securities and common securities issued
by a trust are to be redeemed on a redemption date, then the aggregate
liquidation amount of such preferred and common securities to be redeemed shall
be allocated pro rata to the preferred and common securities based upon the
relative liquidation amounts of such classes. The particular preferred
securities to be redeemed shall be selected on
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a pro rata basis not more than 60 days prior to the redemption date by the
property trustee from the outstanding preferred securities not previously called
for redemption, or by such method (including without limitation by lot) as the
property trustee shall deem fair and appropriate. The property trustee shall
promptly notify the trust registrar in writing of the preferred securities
selected for redemption and, in the case of any preferred securities selected
for partial redemption, the liquidation amount thereof to be redeemed. For all
purposes of each trust agreement, unless the context otherwise requires, all
provisions relating to the redemption of preferred securities shall relate, in
the case of any preferred securities redeemed or to be redeemed only in part, to
the portion of the liquidation amount of preferred securities which has been or
is to be redeemed.
Notice of any redemption will be mailed at least 30 days but not more than
60 days before the redemption date to each holder of trust securities to be
redeemed at its registered address. Unless we default in payment of the
redemption price on the corresponding subordinated debt securities, on and after
the redemption date interest will cease to accrue on such subordinated debt
securities or portions thereof (and distributions will cease to accrue on the
related preferred securities or portions thereof) called for redemption.
(Section 4.2 of the trust agreements)
Subordination of Common Securities
Payment of distributions on, and the redemption price of, each trust's
preferred and common securities, as applicable, shall be made pro rata based on
the liquidation amount of such preferred and common securities; provided,
however, that if on any distribution date or redemption date an event of default
under the corresponding subordinated debt securities shall have occurred and be
continuing, no payment of any distribution on, or redemption price of, any of
the trust's common securities, and no other payment on account of the
redemption, liquidation or other acquisition of such common securities, shall be
made unless payment in full in cash of all accumulated and unpaid distributions
on all of the trust's outstanding preferred securities for all distribution
periods terminating on or prior thereto, or in the case of payment of the
redemption price the full amount of such redemption price on all of the trust's
outstanding preferred securities then called for redemption, shall have been
made or provided for, and all funds available to the property trustee shall
first be applied to the payment in full in cash of all distributions on, or
redemption price of, the trust's preferred securities then due and payable.
In the case of any event of default under the trust agreement resulting
from a event of default under the corresponding subordinated debt securities,
the holder of such trust's common securities will be deemed to have waived any
right to act with respect to any such event of default under the applicable
trust agreement until the effect of all such events of default with respect to
such preferred securities have been cured, waived or otherwise eliminated. Until
any such events of default under the applicable trust agreement with respect to
the preferred securities have been so cured, waived or otherwise eliminated, the
property trustee shall act solely on behalf of the holders of such preferred
securities and not on behalf of the holder of the trust's common securities, and
only the holders of such preferred securities will have the right to direct the
property trustee to act on their behalf. (Section 4.3 of the trust agreements)
Liquidation Distribution Upon Dissolution of a Trust
Pursuant to each trust agreement, each trust shall automatically dissolve
upon expiration of its term and shall dissolve on the first to occur of:
(1) certain events of our bankruptcy, dissolution or liquidation;
(2) the written direction to the property trustee from Trenwick, as
depositor, at any time (which direction is optional and wholly within the
discretion of Trenwick, as depositor) to dissolve the trust and distribute
corresponding subordinated debt securities having an aggregate principal
amount equal to the aggregate stated liquidation amount of the trust
securities to the holders of the trust securities in exchange for the trust
securities;
(3) the redemption of all of the trust's trust securities following a
special event;
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(4) the redemption of all of the trust's preferred securities as
described under "Description of Trust Preferred Securities -- Redemption or
Exchange -- Mandatory Redemption"; and
(5) the entry of an order for the dissolution of the trust by a court
of competent jurisdiction. (Section 9.2 of the trust agreements)
If an early dissolution occurs as described in clause (1), (2) or (5) above
or upon the date designated for automatic dissolution of the trust, the trust
shall be liquidated by the trustees as expeditiously as the trustees determine
to be possible by distributing, after satisfaction of liabilities to creditors
of such trust as provided by applicable law, to the holders of such trust
securities corresponding subordinated debt securities having an aggregate
principal amount equal to the aggregate stated liquidation amount of the trust
securities. However, if such distribution is determined by the property trustee
not to be practical, such holders will be entitled to receive out of the assets
of the trust available for distribution to holders, after satisfaction of
liabilities to creditors of such trust as provided by applicable law, an amount
equal to, in the case of holders of preferred securities, the aggregate of the
liquidation amount plus accumulated and unpaid distributions thereon to the date
of payment (such amount being the "liquidation distribution"). If such
liquidation distribution can be paid only in part because such trust has
insufficient assets available to pay in full the aggregate liquidation
distribution, then the amounts payable directly by such trust on its preferred
securities shall be paid on a pro rata basis. The holder of such trust's common
securities will be entitled to receive distributions upon any such liquidation
pro rata with the holders of its preferred securities, except that if an event
of default under the corresponding subordinated debt securities has occurred and
is continuing, the preferred securities shall have a priority over the common
securities. (Section 9.4 of the trust agreements)
Events of Default; Notice
Any one of the following events constitutes an "event of default" under
each trust agreement with respect to the applicable preferred securities
(whatever the reason for such event of default and whether it shall be voluntary
or involuntary or be effected by operation of law or pursuant to any judgment,
decree or order of any court or any order, rule or regulation of any
administrative or governmental body):
(1) the occurrence of an event of default in respect of the
corresponding subordinated debt securities (see "Description of Debt
Securities and Trenwick Guarantee -- Events of Default"); or
(2) default by the trust in the payment of any distribution when it
becomes due and payable, and continuation of such default for a period of
30 days; or
(3) default by the trust in the payment of any redemption price of any
trust security when it becomes due and payable; or
(4) default in the performance, or breach, in any material respect, of
any covenant or warranty of the trustees in such trust agreement (other
than a covenant or warranty a default in the performance of which or the
breach of which is dealt with in clause (2) or (3) above), and continuation
of such default or breach for a period of 60 days after there has been
given, by registered or certified mail, to the defaulting trustee or
trustees by the holders of at least 25% in aggregate liquidation preference
of the outstanding preferred securities of the applicable trust, a written
notice specifying such default or breach and requiring it to be remedied
and stating that such notice is a "Notice of Default" under such trust
agreement; or
(5) the occurrence of certain events of bankruptcy or insolvency with
respect to the property trustee and the failure by Trenwick, as depositor,
to appoint a successor property trustee within 60 days thereof. (Section
1.1 of the trust agreements)
Within 5 business days after the occurrence of any event of default
actually known to the property trustee, the property trustee shall transmit
notice of such event of default to the holders of such trust's preferred
securities, the administrative trustees and Trenwick, as depositor, unless such
event of default shall have been cured or waived. (Section 8.2 of the trust
agreements) Trenwick, as depositor, and the
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administrative trustees are required to file annually with the property trustee
a certificate as to whether or not they are in compliance with all the
conditions and covenants applicable to them under each trust agreement.
(Sections 8.15 and 8.16 of the trust agreements)
If an event of default under the corresponding subordinated debt securities
has occurred and is continuing, the preferred securities shall have a preference
over the common securities upon dissolution of each trust as described above.
See "-- Liquidation Distribution Upon Dissolution of a Trust." The existence of
an event of default under the trust agreement does not entitle the holders of
preferred securities to accelerate the maturity thereof.
Removal of Trustees
Unless an event of default under the corresponding subordinated debt
securities shall have occurred and be continuing, any trustee may be removed at
any time by the holder of the common securities. If an event of default under
the corresponding subordinated debt securities has occurred and is continuing,
the property trustee and the Delaware Trustee may be removed at such time by the
holders of a majority in liquidation amount of the outstanding preferred
securities. In no event will the holders of the preferred securities have the
right to vote to appoint, remove or replace the administrative trustees, which
voting rights are vested exclusively in the holder of the common securities. No
resignation or removal of a trustee and no appointment of a successor trustee
shall be effective until the acceptance of appointment by the successor trustee
in accordance with the provisions of the applicable trust agreement. (Section
8.10 of the trust agreements)
Co-Trustees and Separate Property Trustee
Unless an event of default shall have occurred and be continuing, at any
time or times, for the purpose of meeting the legal requirements of the Trust
Indenture Act or of any jurisdiction in which any part of the property of any
trust may at the time be located, Trenwick, as depositor, and the administrative
trustees shall have power to appoint one or more persons either to act as a
co-trustee, jointly with the property trustee, of all or any part of the
property of such trust, or to act as separate trustee of any such property, in
either case with such powers as may be provided in the instrument of
appointment, and to vest in such person or persons in such capacity any
property, title, right or power deemed necessary or desirable, subject to the
provisions of the applicable trust agreement. In case an event of default under
the corresponding Trenwick America subordinated debt securities has occurred and
is continuing, the property trustee alone shall have power to make such
appointment. (Section 8.9 of the trust agreements)
Merger or Consolidation of trustees
Any corporation into which the property trustee, the Delaware trustee or
any administrative trustee that is not a natural person may be merged or
converted or with which it may be consolidated, or any corporation resulting
from any merger, conversion or consolidation to which such trustee shall be a
party shall be the successor of such trustee under each trust agreement,
provided such corporation shall be otherwise qualified and eligible. (Section
8.12 of the trust agreements)
Mergers, Consolidations, Amalgamations or Replacements of the Trusts
A trust may not merge with or into, convert into, consolidate, amalgamate,
or be replaced by, or convey, transfer or lease its properties and assets
substantially as an entirety to any corporation or other entity, except as
described below or as described in "Liquidation Distribution Upon Dissolution of
a Trust." A trust may, at the request of Trenwick America, with the consent of
only the administrative trustees and without the consent of the holders of the
preferred securities, merge with or into, convert into, consolidate, amalgamate,
or be replaced by or convey, transfer or lease its properties and assets
substantially as an entirety to a trust organized as such under the laws of any
State, provided, that
(1) such successor entity either (a) expressly assumes all of the
obligations of such trust with respect to the preferred securities or (b)
substitutes for the preferred securities other securities having
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substantially the same terms as the preferred securities (which we call the
"successor securities") so long as the successor securities rank the same
as the preferred securities rank in priority with respect to distributions
and payments upon liquidation, redemption and otherwise,
(2) we expressly appoint a trustee of such successor entity possessing
the same powers and duties as the property trustee as the holder of the
corresponding subordinated debt securities,
(3) the successor securities are listed or traded, or any successor
securities will be listed upon notification of issuance, on any national
securities exchange or other organization on which the preferred securities
are then listed or traded, if any,
(4) such merger, conversion, consolidation, amalgamation, replacement,
conveyance, transfer or lease does not cause the preferred securities
(including any successor securities) to be downgraded by any nationally
recognized statistical rating organization,
(5) such merger, conversion, consolidation, amalgamation, replacement,
conveyance, transfer or lease does not adversely affect the rights,
preferences and privileges of the holders of the preferred securities
(including any successor securities) in any material respect,
(6) such successor entity has a purpose substantially identical to
that of the trust,
(7) prior to such merger, conversion, consolidation, amalgamation,
replacement, conveyance, transfer or lease, we have received an opinion
from independent counsel to the trust experienced in such matters to the
effect that (a) such merger, conversion, consolidation, amalgamation,
replacement, conveyance, transfer or lease does not adversely affect the
rights, preferences and privileges of the holders of the preferred
securities (including any successor securities) in any material respect,
and (b) following such merger, conversion, consolidation, amalgamation,
replacement, conveyance, transfer or lease, neither the trust nor any
successor entity will be required to register as an "investment company"
under the Investment Company Act, and
(8) we or any permitted successor or assignee owns all of the common
securities of such successor entity and guarantees the obligations of such
successor entity under the Successor Securities at least to the extent
provided by the preferred securities guarantee.
Notwithstanding the foregoing, a trust shall not, except with the consent
of holders of 100% in liquidation amount of the preferred securities,
consolidate, amalgamate, merge with or into, convert into, or be replaced by or
convey, transfer or lease its properties and assets substantially as an entirety
to any other entity or permit any other entity to consolidate, amalgamate, merge
with or into, convert into, or replace it if such consolidation, amalgamation,
merger, replacement, conveyance, transfer or lease would cause the trust or the
successor entity to be classified as other than a grantor trust for United
States federal income tax purposes. (Section 9.5 of the trust agreements)
Voting and Preemptive Rights
Except as provided below and under "-- Removal of Trustees," "Description
of Debt Securities and Trenwick Guarantee -- Events of Default," "Description of
Preferred Securities Guarantees -- Amendments and Assignment" and as otherwise
required by law and the applicable trust agreement, the holders of the preferred
securities will have no voting rights. Holders of the preferred securities have
no preemptive or similar rights. (Sections 5.14 and 6.1 of the trust agreements)
Amendment of Trust Agreements
Each trust agreement may be amended from time to time by us and the
administrative trustees, without the consent of the holders of the trust
securities:
(1) to cure any ambiguity, correct or supplement any provisions in the
trust agreement that may be inconsistent with any other provision, or to
make any other provisions with respect to matters or
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questions arising under the trust agreement, which shall not be
inconsistent with the other provisions of that trust agreement, or
(2) to modify, eliminate or add to any provisions of the trust
agreement to such extent as shall be necessary to ensure that the trust
will be classified for United States federal income tax purposes as a
grantor trust at all times that any trust securities are outstanding or to
ensure that the trust will not be required to register as an "investment
company" under the Investment Company Act;
provided, however, that in the case of clause (1), such action shall not
adversely affect in any material respect the interests of any holder of trust
securities. Any amendments of a trust agreement shall become effective when
notice of the amendment is given to the holders of trust securities of the
applicable trust.
Each trust agreement may be amended by us and the administrative trustees
with the consent of holders representing not less than a majority (based upon
liquidation amounts) of the outstanding trust securities, and receipt by the
administrative trustees of an opinion of counsel to the effect that such
amendment or the exercise of any power granted to the trustees in accordance
with such amendment will not affect the trust's status as a grantor trust for
United States federal income tax purposes or the trust's exemption from status
as an "investment company" under the Investment Company Act. However, without
the consent of each holder of trust securities, the trust agreement may not be
amended to:
(1) change the amount or timing of any distribution on the trust
securities or otherwise adversely affect the amount of any distribution
required to be made in respect of the trust securities as of a specified
date, or
(2) restrict the right of a holder of trust securities to institute
suit for the enforcement of any such payment on or after such date.
(Section 10.2 of the trust agreements)
In addition, no amendment may be made to a trust agreement if the amendment
would:
(1) cause a trust to be taxable as a corporation or characterized as
other than a grantor trust for United States federal income tax purposes;
(2) cause the junior subordinated debt securities held by a trust to
not be treated as indebtedness for United States federal income tax
purposes;
(3) cause a trust to be deemed to be an investment company required to
be registered under the Investment Company Act of 1940 or
(4) impose any additional obligation on us without our consent.
Furthermore, a trust agreement may not be amended in a manner which imposes
any additional obligation on the property trustee or the Delaware trustee
without the consent of the property trustee or the Delaware trustee, as the case
may be.
So long as any corresponding subordinated debt securities are held by the
property trustee, the trustees shall not:
(1) direct the time, method and place of conducting any proceeding for
any remedy available to the trustee under the subordinated indenture, or
executing any trust or power conferred on that trustee with respect to such
corresponding subordinated debt securities,
(2) waive any past default that is waivable under Section 5.13 of the
Trenwick America subordinated indenture (as described in "Description of
the Debt Securities and Trenwick Guarantee -- Modification and Waiver"),
(3) exercise any right to rescind or annul a declaration that the
principal of all the subordinated debt securities shall be due and payable,
or
(4) consent to any amendment, modification or termination of the
Trenwick America subordinated indenture or such corresponding subordinated
debt securities, where such consent shall
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be required, without, in each case, obtaining the prior approval of the
holders of a majority in aggregate liquidation amount of all outstanding
preferred securities.
However, where a consent under the Trenwick America subordinated indenture
would require the consent of each holder of corresponding subordinated debt
securities affected thereby, no such consent shall be given by the property
trustee without the prior consent of each holder of the corresponding preferred
securities. The trustees shall not revoke any action previously authorized or
approved by a vote of the holders of the preferred securities except by
subsequent vote of the holders of the preferred securities. The property trustee
shall notify each holder of preferred securities of any notice of default with
respect to the corresponding subordinated debt securities. In addition to
obtaining the foregoing approvals of the holders of the preferred securities,
prior to taking any of the foregoing actions, the trustees shall obtain an
opinion of independent counsel experienced in such matters to the effect that
the trust will not be classified as an association taxable as a corporation for
United States federal income tax purposes on account of such action. (Section
6.1 of the trust agreements)
Any required approval or action of holders of preferred securities may be
given or taken at a meeting of holders of preferred securities convened for such
purpose or pursuant to written consent. The property trustee will cause a notice
of any meeting at which holders of preferred securities are entitled to vote to
be given to each holder of record of preferred securities in the manner set
forth in each trust agreement. (Sections 6.2, 6.3 and 6.6 of the trust
agreements)
No vote or consent of the holders of preferred securities will be required
for a trust to redeem and cancel its preferred securities in accordance with the
applicable trust agreement.
Notwithstanding that holders of preferred securities are entitled to vote
or consent under any of the circumstances described above, any of the preferred
securities that are owned by us, the trustees or any affiliate of ours, shall,
for purposes of such vote or consent, be treated as if they were not
outstanding.
Global Preferred Securities
The preferred securities of a trust may be issued in whole or in part in
the form of one or more global preferred securities that will be deposited with,
or on behalf of, the depositary identified in the prospectus supplement.
The specific terms of the depositary arrangement with respect to the
preferred securities of a trust will be described in the related prospectus
supplement. Trenwick anticipates that the following provisions will generally
apply to depositary arrangements.
Upon the issuance of a global preferred security, and the deposit of such
global preferred security with or on behalf of the depositary, the depositary
for such global preferred security or its nominee will credit, on its book-entry
registration and transfer system, the respective aggregate liquidation amounts
of the individual preferred securities represented by such global preferred
securities to the accounts of participants. Such accounts shall be designated by
the underwriters or agents with respect to such preferred securities or by us if
such preferred securities are offered and sold directly by us. Ownership of
beneficial interests in a global preferred security will be limited to
participants or persons that may hold interests through participants. Ownership
of beneficial interests in such global preferred security will be shown on, and
the transfer of that ownership will be effected only through, records maintained
by the depositary or its nominee (with respect to interests of participants) and
the records of participants (with respect to interests of persons who hold
through participants). The laws of some states require that certain purchasers
of securities take physical delivery of such securities in definitive form. Such
limits and such laws may impair the ability to transfer beneficial interests in
a global preferred security.
So long as the depositary for a global preferred security, or its nominee,
is the registered owner of such global preferred security, such depositary or
such nominee, as the case may be, will be considered the sole owner or holder of
the preferred securities represented by such global preferred security for all
purposes under the trust agreement governing such preferred securities. Except
as provided below, owners of beneficial interests in a global preferred security
will not be entitled to have any of the individual
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preferred securities represented by such global preferred security registered in
their names, will not receive or be entitled to receive physical delivery of any
such preferred securities in definitive form and will not be considered the
owners or holders thereof under the trust agreement.
Payments of any liquidation amount, premium or distributions in respect of
individual preferred securities registered in the name of a depositary or its
nominee will be made to the depositary or its nominee, as the case may be, as
the registered owner of the global preferred security representing such
preferred securities. None of Trenwick, Trenwick America, the property trustee,
any paying agent, or the securities registrar for such preferred securities will
have any responsibility or liability for any aspect of the records relating to
or payments made on account of beneficial ownership interests of the global
preferred security representing such preferred securities or for maintaining,
supervising or reviewing any records relating to such beneficial ownership
interests.
We expect that the depositary or its nominee, upon receipt of any payment
in respect of a global preferred security representing any trust's preferred
securities, will credit immediately participants' accounts with payments in
amounts proportionate to their respective beneficial interest in the aggregate
liquidation amount of such global preferred security for such preferred
securities as shown on the records of such depositary or its nominee. We also
expect that payments by participants to owners of beneficial interests in such
global preferred security held through such participants will be governed by
standing instructions and customary practices, as is now the case with
securities held for the accounts of customers in bearer form or registered in
"street name" and will be the responsibility of such participants.
Unless otherwise specified in the applicable prospectus supplement, the
trust agreement of each trust will provide that (1) if we advise the trustees in
writing that the depositary is no longer willing or able to act as depositary
and we fail to appoint a qualified successor within 90 days, (2) we, at our
option, advise the trustees in writing that it elects to terminate the
book-entry system through the depositary or (3) after the occurrence of an event
of default under the corresponding subordinated debt securities, owners of
preferred securities representing at least a majority of liquidation amount of
such preferred securities advise the property trustee in writing that the
continuation of a book-entry system through the depositary is no longer in their
best interests, then the global preferred securities will be exchanged for
preferred securities in definitive form in accordance with the instructions of
the depositary. It is expected that such instructions may be based upon
directions received by the depositary from participants with respect to
ownership of beneficial interests in global preferred securities. Individual
preferred securities so issued will be issued in authorized denominations.
Payment and Paying Agency
Payments of distributions in respect of the preferred securities shall be
made to the depositary, which shall credit the relevant accounts at the
depositary on the applicable distribution dates or, if any trust's preferred
securities are not held by the depositary, such payments shall be made by check
mailed to the address of the holder entitled thereto as such address shall
appear on the register of that trust. (Section 4.4) Unless otherwise specified
in the applicable prospectus supplement, the paying agent shall initially be the
property trustee and any co-paying agent chosen by the property trustee and
acceptable to the administrative trustees and us. The paying agent shall be
permitted to resign as paying agent upon 30 days written notice to the
administrative trustees, the property trustee and us. In the event the property
trustee shall no longer be the paying agent, the administrative trustees shall
appoint a successor (which shall be a bank or trust company acceptable to the
administrative trustees and us) to act as paying agent. (Section 5.9 of the
trust agreements)
Registrar and Transfer Agent
Unless otherwise specified in the applicable prospectus supplement, the
property trustee will act as registrar and transfer agent for the preferred
securities.
Registration of transfers and exchanges of preferred securities will be
effected without charge by or on behalf of each trust, but upon payment of any
tax or other governmental charges that may be imposed in
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connection with any transfer or exchange. The trusts will not be required to
register or cause to be registered the transfer of their preferred securities
after such preferred securities have been called for redemption. (Section 5.4 of
the trust agreements)
Information Concerning the Property Trustee
The property trustee undertakes to perform only those duties specifically
set forth in each trust agreement, provided that it must exercise the same
degree of care as a prudent person would exercise in the conduct of his or her
own affairs. Subject to this provision, the property trustee is under no
obligation to exercise any of the powers vested in it by the applicable trust
agreement at the request of any holder of preferred securities unless it is
offered reasonable indemnity against the costs, expenses and liabilities that
might be incurred thereby. If in performing its duties under the trust
agreement, the property trustee is required to decide between alternative causes
of action, construe ambiguous provisions in the applicable trust agreement or is
unsure of the application of any provision of the applicable trust agreement,
and the matter is not one on which holders of preferred securities are entitled
under such trust agreement to vote, then the property trustee shall take such
action as is directed by us. If it is not so directed, the property trustee
shall take such action as it deems advisable and in the best interests of the
holders of the trust securities and will have no liability except for its own
bad faith, negligence or willful misconduct (Sections 8.1 and 8.3).
Administrative Trustees
The administrative trustees are authorized and directed to conduct the
affairs of and to operate the trusts in such a way that no trust will be deemed
to be an "investment company" required to be registered under the Investment
Company Act or classified as an association taxable as a corporation for United
States federal income tax purposes and so that the corresponding Trenwick
America subordinated debt securities will be treated as indebtedness of Trenwick
America for United States federal income tax purposes. In this connection, we
and the administrative trustees are authorized to take any action, not
inconsistent with applicable law, the certificate of trust of each trust or each
trust agreement, that we and the administrative trustees determine in their
discretion to be necessary or desirable for such purposes, as long as such
action does not materially adversely affect the interests of the holders of the
related preferred securities.
DESCRIPTION OF PREFERRED SECURITIES GUARANTEES
Concurrently with the issuance by each trust of its preferred securities,
Trenwick will execute and deliver a preferred securities guarantee for the
benefit of the holders from time to time of such preferred securities. Bank One
Trust Company will act as indenture trustee or "(guarantee trustee)" under each
preferred securities guarantee for the purposes of compliance with the Trust
Indenture Act, and each preferred securities guarantee will be qualified as an
indenture under the Trust Indenture Act. Because the following summary of
certain provisions of the preferred securities guarantees is not complete, you
should refer to the form of preferred securities guarantee and the Trust
Indenture Act for more complete information regarding the provisions of each
preferred securities guarantee, including the definitions of some of the terms
used below. The form of the preferred securities guarantee has been filed as an
exhibit to the registration statement of which this document forms a part.
Reference in this summary to preferred securities means that trust's preferred
securities to which a preferred securities guarantee relates. The guarantee
trustee will hold each preferred securities guarantee for the benefit of the
holders of the related trust's preferred securities.
General
Trenwick will irrevocably agree to pay in full on a subordinated basis, to
the extent described in this document, the "guarantee payments" (as defined
below) (without duplication of amounts already paid by or on behalf of the
trust) to the holders of the preferred securities, as and when due, regardless
of any
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defense, right of setoff or counterclaim that the trust may have or assert other
than the defense of payment. (Section 5.1 of the preferred securities guarantee)
The following payments with respect to the preferred securities, to the extent
not paid by or on behalf of the related trust (the "guarantee payments"), will
be subject to the preferred securities guarantee:
(1) any accrued and unpaid distributions required to be paid on such
preferred securities, to the extent that the trust has funds on hand
available for payment at such time,
(2) the redemption price, including all accrued and unpaid
distributions to the redemption date, with respect to any preferred
securities called for redemption, to the extent that the trust has funds on
hand available for payment at such time, and
(3) upon a voluntary or involuntary dissolution, winding up or
liquidation of the trust (unless the corresponding subordinated debt
securities are distributed to holders of such preferred securities), the
lesser of (a) the liquidation distribution, to the extent such trust has
funds available for payment at such time and (b) the amount of assets of
such trust remaining available for distribution to holders of preferred
securities. (Section 1.1 of the preferred securities guarantee)
Trenwick's obligation to make a guarantee payment may be satisfied by
direct payment of the required amounts by Trenwick to the holders of the
applicable preferred securities or by causing the trust to pay such amounts to
such holders. (Section 5.1 of the preferred securities guarantees)
Each preferred securities guarantee will be an irrevocable guarantee on a
subordinated basis of the related trust's payment obligations under the
preferred securities, but will apply only to the extent that such related trust
has funds sufficient to make such payments. Each preferred securities guarantee
is, to that extent, a guarantee of payment and not a guarantee of collection.
See "-- Status of the Preferred Securities Guarantees."
If Trenwick America or Trenwick does not make interest payments on the
corresponding subordinated debt securities held by a trust, the trust will not
be able to pay distributions on the preferred securities and will not have funds
legally available for payment. Each preferred securities guarantee will rank
subordinate and junior in right of payment to all senior indebtedness of
Trenwick (including all Trenwick debt securities and Trenwick's obligations as
guarantor under the Trenwick America subordinated indenture), as described below
under "-- Status of the Preferred Securities Guarantees" and in the related
prospectus supplement. Because Trenwick is a holding company, its rights and the
rights of its creditors (including the holders of preferred securities who are
creditors of Trenwick by virtue of a preferred securities guarantee) and
shareholders, to participate in any distribution of assets of any subsidiary
upon such subsidiary's liquidation or reorganization or otherwise would be
subject to the prior claims of the subsidiary's creditors, except to the extent
that Trenwick may itself be a creditor with recognized claims against the
subsidiary. The right of creditors of Trenwick (including the holders of
preferred securities who are creditors of Trenwick by virtue of a preferred
securities guarantee) to participate in the distribution of stock owned by
Trenwick in certain of its subsidiaries, including Trenwick's insurance
subsidiaries, may also be subject to approval by certain insurance regulatory
authorities having jurisdiction over such subsidiaries. Except as otherwise
provided in the applicable prospectus supplement, the preferred securities
guarantees do not limit the ability of Trenwick to incur or issue other secured
or unsecured debt, whether under an indenture or otherwise.
Trenwick's obligations described in this document and in any accompanying
prospectus supplement, through the applicable preferred securities guarantee,
the Trenwick America subordinated indenture (including the Trenwick guarantee of
the subordinated debt securities) and any supplemental indentures thereto and
the expense agreement described below, taken together, constitute a full,
irrevocable and unconditional guarantee by Trenwick of payments due on the
preferred securities. No single document standing alone or operating in
conjunction with fewer than all of the other documents constitutes such
guarantee. It is only the combined operation of these documents that has the
effect of providing a full, irrevocable and unconditional guarantee of the
trust's obligations under the preferred securities. See also "Description of
Debt Securities and Trenwick Guarantee."
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Trenwick will also agree to guarantee the obligations of each trust with
respect to the common securities issued by the trust to the same extent as under
the preferred securities guarantee, except that if an event of default under the
Trenwick America subordinated indenture has occurred and is continuing, the
holders of preferred securities under the preferred securities guarantee will
have priority over the holders of the common securities under the common
securities guarantee with respect to distributions and payments on liquidation,
redemption or otherwise.
Status of the Preferred Securities Guarantees
Each preferred securities guarantee will constitute an unsecured obligation
of Trenwick and will rank subordinate and junior in right of payment to all
senior indebtedness of Trenwick (including all Trenwick debt securities and
Trenwick's obligations as guarantor under the Trenwick America subordinate
indenture), except those ranking equally or subordinate by their terms. (Section
6.2 of the preferred securities guarantees) For purposes of any preferred
securities guarantee, "senior indebtedness" means all "indebtedness" of Trenwick
(including its obligations as guarantor under the Trenwick America subordinated
indenture) outstanding at any time, except (a) the indebtedness under the
preferred securities guarantee, (b) indebtedness as to which, by the terms of
the instrument creating or evidencing the same, it is provided that such
indebtedness is subordinated to or ranks equally with the preferred securities
guarantee or to other indebtedness of Trenwick which is subordinated to or ranks
equally with the preferred securities guarantee, (c) indebtedness of Trenwick to
an affiliate of Trenwick, (d) interest accruing after the filing of a petition
initiating any bankruptcy, insolvency or other similar proceeding unless such
interest is an allowed claim enforceable against Trenwick in a proceeding under
federal or state bankruptcy laws, (e) trade accounts payable and (f) similar
preferred securities guarantees issued by Trenwick on behalf of holders of
preferred securities of any trust, partnership or other entity affiliated with
Trenwick which is a financing vehicle of Trenwick or any affiliate of Trenwick
in connection with the issuance by such entity of preferred securities or other
similar securities that are guaranteed by Trenwick pursuant to an instrument
that ranks equally with or junior in right of payment to the preferred
securities guarantee. "Indebtedness" has the same meaning given to that term
under the Trenwick indentures. (Section 1.1 of the preferred securities
guarantees)
Each preferred securities guarantee will rank equally with all other
similar preferred securities guarantees issued by us on behalf of holders of
preferred securities of any trust, partnership or other entity affiliated with
us which is a financing vehicle of ours in connection with the issuance by such
entity of preferred securities or other similar securities that are guaranteed
by Trenwick pursuant to an instrument that ranks equally with or junior in right
of payment to the preferred securities guarantee. (Section 6.3 of the preferred
securities guarantees). Each preferred securities guarantee will constitute a
guarantee of payment and not of collection. This means that the guaranteed party
may, to the extent permitted by law, institute a legal proceeding directly
against us to enforce its rights under the preferred securities guarantee
without first instituting a legal proceeding against any other person or entity,
including the applicable trust. (Section 5.5 of the preferred securities
guarantees). Each preferred securities guarantee will not be discharged except
by payment of the guarantee payments in full to the extent not paid by the trust
or upon distribution to the holders of the preferred securities of the
corresponding subordinated debt securities. None of the preferred securities
guarantees places a limitation on the amount of additional Indebtedness that may
be incurred by us. We expect from time to time to incur additional indebtedness
that will rank senior to the preferred securities guarantees.
Payment of Additional Amounts
Trenwick will make all guarantee payments pursuant to the preferred
securities guarantee without withholding or deduction at source for, or on
account of, any present or future taxes, fees, duties, assessments or
governmental charges of whatever nature imposed or levied by or on behalf of
Bermuda or any political subdivision or taxing authority thereof or therein (a
"taxing jurisdiction"), unless such taxes, fees, duties, assessments or
governmental charges are required to be withheld or deducted by (x) the laws (or
any regulations or rulings promulgated thereunder) of a taxing jurisdiction or
(y) an official position
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regarding the application, administration, interpretation or enforcement of any
such laws, regulations or rulings (including, without limitation, a holding by a
court of competent jurisdiction or by a taxing authority in a taxing
jurisdiction). If a withholding or deduction at source is required, we will,
subject to certain limitations and exceptions described below, pay to the holder
of any related preferred securities such additional amounts as may be necessary
so that every guarantee payment pursuant to the preferred securities guarantee
made to such holder, after such withholding or deduction, will not be less than
the amount provided for in such preferred securities guarantee to be then due
and payable.
We will not be required to pay any additional amounts for or on account of:
(1) any tax, fee, duty, assessment or governmental charge of whatever
nature which would not have been imposed but for the fact that such holder
(a) was a resident, domiciliary or national of, or engaged in business or
maintained a permanent establishment or was physically present in, the
relevant taxing jurisdiction or otherwise had some connection with the
relevant taxing jurisdiction other than by reason of the mere ownership of
preferred securities, or receipt of payment under such preferred securities
guarantee, (b) presented such preferred security for payment in the
relevant taxing jurisdiction, unless such preferred security could not have
been presented for payment elsewhere, or (c) presented such preferred
security for payment more than 30 days after the date on which the payment
in respect of such preferred security first became due and payable or
provided for, whichever is later, except to the extent that the holder
would have been entitled to such additional amounts if it had presented
such preferred security for payment on any day within that 30-day period;
(2) any estate, inheritance, gift, sale, transfer, personal property
or similar tax;
(3) any tax, assessment or other governmental charge that is imposed
or withheld by reason of the failure by the holder or the beneficial owner
of such preferred security to comply with any reasonable request by us or
the applicable trust addressed to the holder within 90 days of such request
(a) to provide information concerning the nationality, residence or
identity of the holder or such beneficial owner or (b) to make any
declaration or other similar claim or satisfy any information or reporting
requirement, which is required or imposed by statute, treaty, regulation or
administrative practice of the relevant taxing jurisdiction as a
precondition to exemption from all or part of such tax, assessment or other
governmental charge; or
(4) any combination of items (1), (2) and (3).
In addition, Trenwick will not pay any additional amounts with respect to
any guarantee payment to any holder who is a fiduciary or partnership or other
than the sole beneficial owner of the related preferred security to the extent
such payment would be required by the laws of the relevant taxing jurisdiction
to be included in the income for tax purposes of a beneficiary or partner or
settlor with respect to such fiduciary or a member of such partnership or a
beneficial owner who would not have been entitled to such additional amounts had
it been the holder of such preferred security. (Section 5.8 of the preferred
securities guarantees)
Amendments and Assignment
Except with respect to any changes which do not materially adversely affect
the rights of holders of the related preferred securities (in which case no vote
will be required), no preferred securities guarantee may be amended without the
prior approval of the holders of not less than a majority of the aggregate
liquidation amount of such outstanding preferred securities. (Section 8.2) All
guarantees and agreements contained in each preferred securities guarantee shall
bind our successors, assigns, receivers, and trustees and shall inure to the
benefit of the holders of the related preferred securities then outstanding.
(Section 8.1) Except in connection with a consolidation, amalgamation or merger
or conveyance, transfer or lease involving Trenwick that is permitted under the
Trenwick America subordinated indenture and under which the person formed by
such consolidation or amalgamation or into which Trenwick is merged or which
acquires or leases the properties and assets of Trenwick agrees in writing to
perform Trenwick's obligations under the preferred securities guarantee,
Trenwick may not assign its obligations thereunder.
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Events of Default
An event of default under each preferred securities guarantee will occur
upon the failure of ours to perform any of our payment or other obligations
thereunder. The holders of not less than a majority in aggregate liquidation
amount of the related preferred securities have the right to direct the time,
method and place of conducting any proceeding for any remedy available to the
guarantee trustee in respect of such preferred securities guarantee or to direct
the exercise of any trust or power conferred upon the guarantee trustee under
such preferred securities guarantee. (Section 5.4 of the preferred securities
guarantees)
Any holder of the preferred securities may institute a legal proceeding
directly against us to enforce its rights under such preferred securities
guarantee without first instituting a legal proceeding against the trust, the
guarantee trustee or any other person or entity. (Section 5.4 of the preferred
securities guarantees)
Trenwick, as guarantor, is required to file annually with the guarantee
trustee a certificate as to whether or not we are in compliance with all the
conditions and covenants applicable to it under the preferred securities
guarantee. (Section 2.4 of the preferred securities guarantees)
Information Concerning the Guarantee Trustee
The guarantee trustee, other than during the occurrence and continuance of
a default by Trenwick in performance of any preferred securities guarantee,
undertakes to perform only such duties as are specifically set forth in each
preferred securities guarantee and, after default with respect to any preferred
securities guarantee, must exercise the same degree of care and skill as a
prudent person would exercise or use in the conduct of his or her own affairs.
(Section 3.1 of the preferred securities guarantees). Subject to this provision,
the guarantee trustee is under no obligation to exercise any of the powers
vested in it by any preferred securities guarantee at the request of any holder
of any preferred securities unless it is offered reasonable indemnity against
the costs, expenses, and liabilities that might be incurred thereby. (Section
3.2 of the preferred securities guarantees)
Termination of the Preferred Securities Guarantees
Each preferred securities guarantee will terminate and be of no further
force and effect upon (1) full payment of the redemption price of the related
preferred securities, (2) the distribution of the corresponding subordinated
debt securities to the holders of the related preferred securities or (3) upon
full payment of the amounts payable upon liquidation of the related trust. Each
preferred securities guarantee will continue to be effective or will be
reinstated, as the case may be, if at any time any holder of the related
preferred securities must restore payment of any sums paid with respect to such
preferred securities or such preferred securities guarantee. (Section 7.1 of the
preferred securities guarantees)
New York Law to Govern
Each preferred securities guarantee will be governed by and construed in
accordance with the laws of the State of New York applicable to agreements made
and wholly performed in New York, without regard to the conflicts of law
principals of such state. (Section 8.5 of the preferred securities guarantees)
The Expense Agreement
Pursuant to the expense agreement entered into by us under the trust
agreement, we will irrevocably and unconditionally guarantee to each person or
entity to whom a trust becomes indebted or liable, the full payment of any
costs, expenses or liabilities of the trust, other than obligations of the trust
to pay to the holders of the preferred securities or other similar interests in
the trust of the amounts due such holders pursuant to the terms of the preferred
securities or such other similar interests, as the case may be.
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PLAN OF DISTRIBUTION
We may sell offered securities in any one or more of the following ways
from time to time: (1) through agents; (2) to or through underwriters; (3)
through dealers; or (4) directly to purchasers. The prospectus supplement with
respect to the offered securities will set forth the terms of the offering of
the offered securities, including the name or names of any underwriters, dealers
or agents; the purchase price of the offered securities and the proceeds to us
and/or a trust from such sale; any underwriting discounts and commissions or
agency fees and other items constituting underwriters' or agents' compensation;
any initial public offering price and any discounts or concessions allowed or
reallowed or paid to dealers and any securities exchange on which such offered
securities may be listed. Any initial public offering price, discounts or
concessions allowed or reallowed or paid to dealers may be changed from time to
time.
The distribution of the offered securities may be effected from time to
time in one or more transactions at a fixed price or prices, which may be
changed, at market prices prevailing at the time of sale, at prices related to
such prevailing market prices or at negotiated prices.
Offers to purchase offered securities may be solicited by agents designated
by us from time to time. Any such agent involved in the offer or sale of the
offered securities in respect of which this document is delivered will be named,
and any commissions payable by us and/or the applicable trust to such agent will
be set forth, in the applicable prospectus supplement. Unless otherwise
indicated in such prospectus supplement, any such agent will be acting on a
reasonable best efforts basis for the period of its appointment. Any such agent
may be deemed to be an underwriter, as that term is defined in the Securities
Act, of the offered securities so offered and sold.
If offered securities are sold by means of an underwritten offering, we
will execute an underwriting agreement with an underwriter or underwriters, and
the names of the specific managing underwriter or underwriters, as well as any
other underwriters, and the terms of the transaction, including commissions,
discounts and any other compensation of the underwriters and dealers, if any,
will be set forth in the prospectus supplement which will be used by the
underwriters to make resales of the offered securities. If underwriters are
utilized in the sale of the offered securities, the offered securities will be
acquired by the underwriters for their own account and may be resold from time
to time in one or more transactions, including negotiated transactions, at fixed
public offering prices or at varying prices determined by the underwriters at
the time of sale. Offered securities may be offered to the public either through
underwriting syndicates represented by managing underwriters or directly by the
managing underwriters. If any underwriter or underwriters are utilized in the
sale of the offered securities, unless otherwise indicated in the prospectus
supplement, the underwriting agreement will provide that the obligations of the
underwriters are subject to certain conditions precedent and that the
underwriters with respect to a sale of offered securities will be obligated to
purchase all such offered securities of a series if any are purchased.
We may grant to the underwriters options to purchase additional offered
securities, to cover over-allotments, if any, at the public offering price (with
additional underwriting discounts or commissions), as may be set forth in the
prospectus supplement relating thereto. If we grant any over-allotment option,
the terms of such over-allotment option will be set forth in the prospectus
supplement relating to such offered securities.
If a dealer is utilized in the sales of offered securities in respect of
which this document is delivered, we will sell such offered securities to the
dealer as principal. The dealer may then resell such offered securities to the
public at varying prices to be determined by such dealer at the time of resale.
Any such dealer may be deemed to be an underwriter, as such term is defined in
the Securities Act, of the offered securities so offered and sold. The name of
the dealer and the terms of the transaction will be set forth in the related
prospectus supplement.
Offers to purchase offered securities may be solicited directly by us and
the sale thereof may be made by us directly to institutional investors or
others, who may be deemed to be underwriters within the meaning of the
Securities Act with respect to any resale thereof. The terms of any such sales
will be described in the related prospectus supplement.
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Offered securities may also be offered and sold, if so indicated in the
applicable prospectus supplement, in connection with a remarketing upon their
purchase, in accordance with a redemption or repayment pursuant to their terms,
or otherwise, by one or more firms ("remarketing firms"), acting as principals
for their own accounts or as agents for us. Any remarketing firm will be
identified and the terms of its agreements, if any, with us and its compensation
will be described in the applicable prospectus supplement. Remarketing firms may
be deemed to be underwriters, as such term is defined in the Securities Act, in
connection with the offered securities remarketed thereby.
Agents, underwriters, dealers and remarketing firms may be entitled under
relevant agreements entered into with us to indemnification by us against
certain civil liabilities, including liabilities under the Securities Act that
may arise from any untrue statement or alleged untrue statement of a material
fact or any omission or alleged omission to state a material fact in this
document, any supplement or amendment to this document, or in the registration
statement of which this document forms a part, or to contribution with respect
to payments which the agents, underwriters or dealers may be required to make.
If so indicated in the prospectus supplement, we will authorize
underwriters or other persons acting as our agents to solicit offers by certain
institutions to purchase offered securities from us at the public offering
price, pursuant to contracts providing for payments and delivery on a future
date. Institutions with which such contracts may be made include commercial and
savings banks, insurance companies, pension funds, investment companies,
educational and charitable institutions and others, but in all cases such
institutions must be approved by us. The obligations of any purchaser under any
such contract will be subject to the condition that the purchase of the offered
securities shall not at the time of delivery be prohibited under the laws of the
jurisdiction to which such purchaser is subject. The underwriters and such other
agents will not have any responsibility in respect of the validity or
performance of such contracts.
Each series of offered securities will be a new issue and, other than the
common shares which are quoted on the New York Stock Exchange, will have no
established trading market. We may elect to list any series of offered
securities on an exchange, and in the case of common shares, on any additional
exchange, but, unless otherwise specified in the applicable prospectus
supplement, neither we nor the applicable trust shall be obligated to do so. No
assurance can be given as to the liquidity of the trading market for any of the
offered securities.
Underwriters, dealers, agents and remarketing firms, or their affiliates,
may be customers of, engage in transactions with, or perform services for, us
and our subsidiaries in the ordinary course of business.
LEGAL OPINIONS
Certain legal matters with respect to U.S. and New York law will be passed
upon for Trenwick, Trenwick America and the Trenwick America Trusts by Baker &
McKenzie, New York, New York. The validity of the preferred securities under
Delaware law will be passed upon on behalf of Trenwick, Trenwick America and the
Trenwick America Trusts by Richards, Layton & Finger, P.A., Wilmington,
Delaware. Certain legal matters with respect to Bermuda law will be passed upon
for Trenwick by Appleby Spurling & Kempe, Hamilton, Bermuda. Certain legal
matters will be passed upon for the underwriters, dealers or agents, if any, by
LeBoeuf, Lamb, Green & MacRae LLP, New York, New York. Baker & McKenzie will
rely on the opinion of Appleby Spurling & Kempe with respect to Bermuda law.
EXPERTS
The consolidated financial statements and financial statement schedules
incorporated in this document by reference to Trenwick's Annual Report on Form
10-K for the year ended December 31, 2000 have been incorporated in reliance on
the reports of PricewaterhouseCoopers LLP, Deloitte & Touche LLP and KPMG, each
independent accountants, given on the authority of said firms as experts in
accounting and auditing.
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ENFORCEMENT OF CIVIL LIABILITIES UNDER
UNITED STATES FEDERAL SECURITIES LAWS
Trenwick is a Bermuda company. In addition, some of its officers and
directors, as well as some of the experts named in this document, reside outside
the United States, and all or much of its assets and their assets are or may be
located in jurisdictions outside the United States. Therefore, investors may
have difficulty effecting service of process within the United States upon those
persons or recovering against Trenwick or them on judgments of U.S. courts,
including judgments based upon the civil liability provisions of the U.S.
federal securities laws. However, investors may serve Trenwick with process in
the United States with respect to actions against it arising out of or in
connection with violations of U.S. federal securities laws relating to offers
and sales of the securities covered by this document by serving CSC United
States Corporation Company, 1013 Centre Road, Wilmington, Delaware 19805, its
United States agent irrevocably appointed for that purpose.
Trenwick has been advised by its Bermuda counsel, Appleby Spurling & Kempe,
that currently there is no treaty in force between the U.S. and Bermuda
providing for the reciprocal recognition and enforcement of judgments in civil
and commercial matters. As a result, whether a U.S. judgment is or would be
enforceable in Bermuda against Trenwick or its officers and directors depends on
whether the U.S. court is recognized by the Bermuda court as having jurisdiction
over Trenwick or its officers and directors, as determined by reference to
Bermuda conflict of law rules. A judgment debt from a U.S. court which is final
and for a sum certain based on U.S. federal securities law will not be
enforceable in Bermuda unless the judgment debtor had submitted to the
jurisdiction of the U.S. court, and the issue of submission and jurisdiction is
a matter of Bermuda not U.S. law. Additionally, and irrespective of the issue of
jurisdiction, the Bermuda court will not enforce a U.S. federal securities law
which is either penal or of a public law nature. Further, no claim can be
brought in Bermuda against Trenwick or its officers or directors in the first
instance for violation of U.S. securities law as U.S. securities law has no
extraterritorial jurisdiction under Bermuda law, and does not have the force of
law in Bermuda. A Bermuda court may, however, impose civil liability on Trenwick
or its officers and directors in a suit brought in such a court against Trenwick
or its officers and directors, if the facts alleged constitute or give rise to a
cause of action under Bermuda law. Certain remedies available under the laws of
U.S. jurisdictions, including certain remedies under the U.S. federal securities
laws, would not be available under Bermuda law or enforceable in a Bermuda court
as they would be contrary to public policy.
WHERE YOU CAN FIND MORE INFORMATION
Available Information
Trenwick and Trenwick America each file annual, quarterly or other reports,
proxy statements and other information with the SEC. Trenwick's and Trenwick
America's SEC filings are available to the public over the Internet at the SEC's
web site at http://www.sec.gov. You may also read and copy any of this
information at the following locations of the SEC:
Public Reference Room New York Regional Office Chicago Regional Office
450 Fifth Street, N.W. 7 World Trade Center Citicorp Center
Room 1024 Suite 1300 500 West Madison Street
Washington, D.C. 20549 New York, New York 10048 Suite 1400
Chicago, Illinois 60661-2551
You may also obtain copies of this information by mail from the Public
Reference Section of the SEC, 450 Fifth Street, N.W., Room 1024, Washington,
D.C. 20549, at prescribed rates. Further information on the operation of the
SEC's public Reference Room in Washington, D.C. can be obtained by calling the
SEC at 1-800-SEC-0330. You can also inspect reports, proxy statements and other
information about Trenwick and Trenwick America at the offices of the NYSE at 20
Broad Street, New York, New York 10005.
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There are no separate financial statements of the trusts in this document.
We do not believe the financial statements would be helpful to the holders of
the preferred securities of the trusts because:
- Trenwick America, a reporting company under the Exchange Act, will own
all of the voting securities of the trusts;
- The trusts have no independent operations or proposals to engage in any
activity other than issuing securities representing undivided beneficial
interests in the assets of the applicable trust and investing the
proceeds in subordinated debt securities issued by Trenwick America; and
- The obligations of the trust under the preferred securities will be fully
and unconditionally guaranteed by us. See "Description of Preferred
Securities Guarantees."
The trusts are not currently subject to the information reporting
requirements of the Exchange Act. The trusts will become subject to the
requirements upon the effectiveness of the registration statement that contains
this document, although the trusts intend to seek and expect to receive an
exemption from those requirements. If the trusts do not receive such an
exemption, the expenses of operating the trusts would increase, as would the
likelihood that we would exercise our option to dissolve and liquidate the
trusts early.
This document is part of a registration statement that we filed with the
SEC. The registration statement, including the attached exhibits, contains
additional relevant information about Trenwick, Trenwick America and the trusts.
As allowed by the SEC rules and regulations, this document does not contain all
the information you can find in the registration statement or the exhibits to
the registration statement.
The SEC allows us to "incorporate by reference" information into this
document, which means that we can disclose important information to you by
referring you to another document filed separately with the SEC. The information
incorporated by reference is deemed to be part of this document, except for any
information superseded by information in this document. This document
incorporates by reference the documents set forth below that Trenwick and
Trenwick America have previously filed with the SEC. These documents contain
important information about us and our financial condition.
(a) Trenwick's Quarterly Report on Form 10-Q for the period ended
March 31, 2001;
(b) Trenwick America's Quarterly Report on Form 10-Q for the period
ended March 31, 2001;
(c) Trenwick's Annual Report on Form 10-K for the year ended December
31, 2000; and
(d) Trenwick America's Annual Report on Form 10-K for the year ended
December 31, 2000.
We incorporate by reference additional documents that we may file with the
SEC between the date of this document and the termination of the offering. These
documents include periodic reports, such as Annual Reports on Form 10-K,
Quarterly Reports on Form 10-Q and Current Reports on Form 8-K, as well as proxy
statements.
You can obtain any of the documents incorporated by reference in this
document from us or from the SEC through the SEC's web site at the address
described above. Documents incorporated by reference are available from the us
without charge, excluding any exhibits to those documents unless the exhibit is
specifically incorporated by reference as an exhibit in this document. Upon
request, we will provide without charge to each person to whom a copy of this
document has been delivered a copy of any and all of these filings. You can
obtain documents incorporated by reference in this document by requesting them
in writing or by telephone from us at the following addresses:
Investor Relations Department
Trenwick Group Ltd.
Continental Building
25 Church Street
Hamilton HM 12 Bermuda
(441) 292-3339
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PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
Item 14. Other Expenses of Issuance and Distribution.
The following table sets forth the estimated expenses in connection with
the issuance and distribution of the securities registered hereby, other than
underwriting discounts and commissions:
Securities and Exchange Commission registration fee......... $ 100,000
Trustees' fees and expenses................................. $ 22,000
Printing and engraving expenses............................. $ 400,000
Rating agency fees.......................................... $ 195,000
Accounting fees and expenses................................ $ 50,000
Legal fees and expenses..................................... $ 400,000
Blue Sky fees and expenses.................................. $ 10,000
Miscellaneous............................................... $ 200,000
----------
Total............................................. $1,377,000
==========
Item 15. Indemnification of Officers and Directors.
Trenwick
Under Bermuda law, a company is permitted to indemnify any officer or
director, out of the funds of the company, against (a) any liability he or she
incurs in defending any proceedings, whether civil or criminal, in which
judgment is given in his or her favor, or he or she is acquitted, or he or she
is granted relief from liability by the court in connection with any application
under relevant Bermuda legislation; and (b) any loss or liability resulting from
negligence, default, breach of duty or breach of trust, save for his or her
fraud or dishonesty.
The bye-laws of Trenwick provide for the indemnification of its officers
and directors as well as their heirs, executors and administrators to the
fullest extent permitted by law. Bermuda law does not permit indemnification of
a person who is or may be found guilty of fraud or dishonesty.
The bye-laws of Trenwick also provide that all reasonable expenses
(including attorneys' fees) incurred by or on behalf of an officer or director
of Trenwick in defending any civil, criminal, administrative or investigative
action, suit or proceeding shall be paid by Trenwick in advance of the final
disposition of such action, suit or proceeding upon receipt of an undertaking by
or on behalf of such director or officer to repay such amount if it shall
ultimately be determined that he or she is not entitled to be indemnified by
Trenwick pursuant to Bermuda law.
The bye-laws of Trenwick also provide that each of the Shareholders of
Trenwick waives any claim or right of action it may have, whether individually
or by or in right of Trenwick, against an officer or director of Trenwick for
any actions or omissions by such person in the performance of such person's
duties as an officer or director of Trenwick. The waiver does not extend to any
claims or rights of action arising out of the fraud or dishonesty of such person
or to recover any gain, personal profit or advantage to which such person is not
legally entitled.
Reference is made to the forms of Underwriting Agreement filed as Exhibits
1.1 though 1.5 of this registration statement. The Underwriting Agreements
provide, among other things, that the underwriters are obligated, under certain
circumstances, to indemnify directors, certain officers and controlling persons
of Trenwick against certain liabilities, including liabilities under the
Securities Act of 1933, as amended.
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Trenwick America Corporation
Section 145 of the Delaware General Corporation Law, as amended, provides
in regards to indemnification of directors and officers as follows:
145. Indemnification of Officers, Directors, Employees and Agents;
Insurance.
(a) A corporation shall have the power to indemnify any person who was
or is a party or is threatened to be made a party to any threatened,
pending or completed action, suit or proceeding, whether civil, criminal,
administrative or investigative (other than an action by or in the right of
the corporation) by reason of the fact that the person is or was a
director, officer, employee or agent of the corporation, or is or was
serving at the request of the corporation as a director, officer, employee
or agent of another corporation, partnership, joint venture, trust or other
enterprise, against expenses (including attorneys' fees), judgments, fines
and amounts paid in settlement actually and reasonably incurred by the
person in connection with such action, suit or proceeding if the person
acted in good faith and in a manner the person reasonably believed to be in
or not opposed to the best interests of the corporation, and, with respect
to any criminal action or proceeding, had no reasonable cause to believe
the person's conduct was unlawful. The termination of any action, suit or
proceeding by judgment, order, settlement, conviction, or upon a plea of
nolo contendere or its equivalent, shall not, of itself, create a
presumption that the person did not act in good faith and in a manner which
the person reasonably believed to be in or not opposed to the best
interests of the corporation, and, with respect to any criminal action or
proceeding, had reasonable cause to believe that the person's conduct was
unlawful.
(b) A corporation shall have the power to indemnify any person who was
or is a party or is threatened to be made a party to any threatened,
pending or completed action or suit by or in the right of the corporation
to procure a judgment in its favor by reason of the fact that the person is
or was a director, officer, employee or agent of the corporation, or is or
was serving at the request of the corporation as a director, officer,
employee or agent of another corporation, partnership, joint venture, trust
or other enterprise against expenses (including attorneys' fees) actually
and reasonably incurred by the person in connection with the defense or
settlement of such action or suit if the person acted in good faith and in
a manner the person reasonably believed to be in or not opposed to the best
interests of the corporation and except that no indemnification shall be
made in respect of any claim, issue or matter as to which such person shall
have been adjudged to be liable to the corporation unless and only to the
extent that the Court of Chancery or the court in which such action or suit
was brought shall determine upon application that, despite the adjudication
of liability but in view of all the circumstances of the case, such person
is fairly and reasonably entitled to indemnity for such expenses which the
Court of Chancery or such other court shall deem proper.
(c) To the extent that a present or former director or officer of a
corporation has been successful on the merits or otherwise in defense of
any action, suit or proceeding referred to in subsections (a) and (b) of
this section, or in defense of any claim, issue or matter therein, such
person shall be indemnified against expenses (including attorneys' fees)
actually and reasonably incurred by such person in connection therewith.
(d) Any indemnification under subsections (a) and (b) of this section
(unless ordered by a court) shall be made by the corporation only as
authorized in the specific case upon a determination that indemnification
of the present or former director, officer, employee or agent is proper in
the circumstances because he has met the applicable standard of conduct set
forth in subsections (a) and (b) of this section. Such determination shall
be made, with respect to a person who is a director or an officer at the
time of such determination, (1) by a majority vote of the directors who
were not parties to such action, suit or proceeding even though less than a
quorum, or (2) by a committee of such directors designated by majority vote
of such directors, even though less than a quorum, or (3) if there are no
such directors, or, if such directors so direct, by independent legal
counsel in a written opinion, or (4) by the stockholders.
II-2
62
(e) Expenses (including attorneys' fees) incurred by an officer or
director in defending any civil, criminal, administrative or investigative
action, suit or proceeding may be paid by the corporation in advance of the
final disposition of such action, suit or proceeding upon receipt of an
undertaking by or on behalf of such director or officer to repay such
amount if it shall ultimately be determined that such person is not
entitled to be indemnified by the corporation as authorized in this
section. Such expenses (including attorneys' fees) incurred by former
directors and officers or other employees and agents may be so paid upon
such terms and conditions, if any, as the corporation deems appropriate.
(f) The indemnification and advancement of expenses provided by, or
granted pursuant to, the other subsections of this section shall not be
deemed exclusive of any other rights to which those seeking indemnification
or advancement of expenses may be entitled under any bylaw, agreement, vote
of stockholders or disinterested directors or otherwise, both as to action
in such person's official capacity and as to action in another capacity
while holding such office.
(g) A corporation shall have power to purchase and maintain insurance
on behalf of any person who is or was a director, officer, employee or
agent of the corporation, or is or was serving at the request of the
corporation as a director, officer, employee or agent of another
corporation, partnership, joint venture, trust or other enterprise against
any liability asserted against such person and incurred by such person in
any such capacity, or arising out of such person's status as such, whether
or not the corporation would have the power to indemnify such person
against such liability under this section.
(h) For purposes of this section, references to "the corporation"
shall include, in addition to the resulting corporation, any constituent
corporation (including any constituent of a constituent) absorbed in a
consolidation or merger which, if its separate existence had continued,
would have had power and authority to indemnify its directors, officers,
and employees or agents, so that any person who is or was a director,
officer, employee or agent of such constituent corporation, or is or was
serving at the request of such constituent corporation as a director,
officer, employee or agent of another corporation, partnership, joint
venture, trust or other enterprise, shall stand in the same position under
this section with respect to the resulting or surviving corporation as such
person would have with respect to such constituent corporation if its
separate existence had continued.
(i) For purposes of this section, references to "other enterprises"
shall include employee benefit plans; references to "fines" shall include
any excise taxes assessed on a person with respect to any employee benefit
plan; and references to "serving at the request of the corporation" shall
include any service as a director, officer, employee or agent of the
corporation which imposes duties on, or involves services by, such
director, officer, employee, or agent with respect to an employee benefit
plan, its participants or beneficiaries; and a person who acted in good
faith and in a manner such person reasonably believed to be in the interest
of the participants and beneficiaries of an employee benefit plan shall be
deemed to have acted in a manner "not opposed to the best interests of the
corporation" as referred to in this section.
(j) The indemnification and advancement of expenses provided by, or
granted pursuant to, this section shall, unless otherwise provided when
authorized or ratified, continue as to a person who has ceased to be a
director, officer, employee or agent and shall inure to the benefit of the
heirs, executors and administrators of such a person.
Trenwick America Corporation's by-laws contain provisions which give effect
to the above sections 145(a) through 145(g), inclusive, of the Delaware General
Corporation Law.
Trenwick America Corporation also maintains policies of insurance under
which we and our directors and officers are insured subject to specified
exclusions and deductible and maximum amounts against loss arising from any
claim which may be made against us or any of our directors or officers by reason
of any breach of duty, neglect, error, misstatement, omission or act done or
alleged to have been done while acting in our or their respective capacities.
II-3
63
Item 16. Exhibits and Financial Statement Schedules.
See Exhibit Index included herewith which is incorporated herein by
reference.
Item 17. Undertakings.
The undersigned registrants hereby undertake:
(a) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after
the effective date of the registration statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in the registration statement. Notwithstanding the foregoing, any
increase or decrease in volume of securities offered (if the total
dollar value of securities offered would not exceed that which was
registered) and any deviation from the low or high end of the estimated
maximum offering range may be reflected in the form of prospectus filed
with the Commission pursuant to Rule 424(b) if, in the aggregate, the
changes in volume and price represent no more than a 20 percent change
in the maximum aggregate offering price set forth in the "Calculation of
Registration Fee" table in the effective registration statement;
(iii) To include any material information with respect to the plan
of distribution not previously disclosed in the registration statement
or any material change to such information in the registration
statement;
provided, however, that paragraphs (a)(i) and (a)(ii) do not apply if the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed with the Commission by
the registrants pursuant to Section 13 or 15(d) of the Securities Exchange
Act of 1934 that are incorporated by reference in the registration
statement.
(b) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed
to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed
to be the initial bona fide offering thereof.
(c) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
The undersigned registrants hereby undertake that, for purposes of
determining any liability under the Securities Act of 1933, each filing of our
annual reports pursuant to Section 13(a) or 15(d) of the Securities Exchange Act
of 1934 (and, where applicable, each filing of an employee benefit plan's annual
report pursuant to Section 15(d) of the Securities Exchange Act of 1934) that is
incorporated by reference in the registration statement shall be deemed to be a
new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
The undersigned registrants hereby undertake:
(a) that for purposes of determining any liability under the
Securities Act of 1933, the information omitted from the form of prospectus
filed as part of this registration statement in reliance upon Rule 430A and
contained in a form of prospectus filed by the registrants pursuant to Rule
424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed to be
part of this registration statement as of the time it was declared
effective;
(b) that for the purpose of determining any liability under the
Securities Act of 1933, each post-effective amendment that contains a form
of prospectus shall be deemed to be a new registration
II-4
64
statement relating to the securities offered therein, and the offering of
such securities at that time shall be deemed to be the initial bona fide
offering thereof;
(c) To provide to the underwriter at the closing specified in the
underwriting agreements certificates in such denominations and registered
in such names as required by the underwriter to permit prompt delivery to
each purchaser; and
(d) To file an application for the purpose of determining the
eligibility of the trustee to act under subsection (a) of Section 210 of
the Trust Indenture Act (the "Act") in accordance with the rules and
regulations prescribed by the Commission under section 305(b)92) of the
Act.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers or persons controlling the
registrants pursuant to the provisions set forth or described in Item 15 of this
registration statement, or otherwise, the registrants have been informed that in
the opinion of the Securities and Exchange Commission such indemnification is
against public policy as expressed in the Securities Act and is therefore
unenforceable. In the event that a claim for indemnification against such
liabilities (other than the payment by a registrant of expenses incurred or paid
by a director, officer or controlling person of such registrant in the
successful defense of any action, suit or proceeding) is asserted by such
director, officer or controlling person in connection with the securities being
registered, the registrants will, unless in the opinion of their counsel the
matter has been settled by controlling precedent, submit to a court of
appropriate jurisdiction the question whether such indemnification by them is
against public policy as expressed in the Securities Act of 1933 and will be
governed by the final adjudication of such issue.
II-5
65
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, Trenwick Group
Ltd. certifies that it has reasonable grounds to believe that it meets all of
the requirements for filing on Form S-3 and has duly caused this Amendment No. 2
to the Registration Statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in Hamilton, Bermuda, on the 23rd day of July, 2001.
Trenwick Group Ltd.
By: /s/ JAMES F. BILLETT, JR.
------------------------------------
James F. Billett, Jr.
Chairman of the Board, President
and Chief Executive Officer
Pursuant to the requirements of the Securities Act of 1933, this Amendment
No. 2 to the registration statement has been signed by the following persons in
the capacities indicated on the 23rd day of July, 2001.
Signature Title
--------- -----
/s/ JAMES F. BILLETT, JR. Chairman of the Board,
- --------------------------------------------------- President and Chief Executive
James F. Billett, Jr. Officer and Director
/s/ COLEMAN D. ROSS Executive Vice President
- --------------------------------------------------- and Chief Financial
Coleman D. Ross Officer
* Director
- ---------------------------------------------------
W. Marston Becker
* Director
- ---------------------------------------------------
Anthony S. Brown
* Director
- ---------------------------------------------------
Richard E. Cole
* Director
- ---------------------------------------------------
Robert M. DeMichele
* Director
- ---------------------------------------------------
Robert V. Deutsch
* Director
- ---------------------------------------------------
Neil Dunn
* Director
- ---------------------------------------------------
Clement S. Dwyer, Jr.
* Director
- ---------------------------------------------------
Frank E. Grzelecki
* Director
- ---------------------------------------------------
P. Anthony Jacobs
II-6
66
Signature Title
--------- -----
* Director
- ---------------------------------------------------
Peter J. Rackley
* Director
- ---------------------------------------------------
Joseph D. Sargent
* Director
- ---------------------------------------------------
Frederick D. Watkins
* Director
- ---------------------------------------------------
Stephen R. Wilcox
/s/ ALAN L. HUNTE Authorized Representative in
- --------------------------------------------------- the United States
Alan L. Hunte
*By: /s/ COLEMAN D. ROSS
--------------------------------------------------
Coleman D. Ross
Attorney-in-Fact
II-7
67
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, Trenwick
America Corporation certifies that it has reasonable grounds to believe that it
meets all of the requirements for filing on Form S-3 and has duly caused this
Amendment No. 2 to the Registration Statement to be signed on its behalf by the
undersigned, thereunto duly authorized, in Stamford, Connecticut, on the 23rd
day of July, 2001.
Trenwick America Corporation
By: /s/ STEPHEN H. BINET
------------------------------------
Stephen H. Binet
President, Chief Executive
Officer and Director
Pursuant to the requirements of the Securities Act of 1933, this Amendment
No. 2 to the registration statement has been signed by the following persons on
behalf of the registrant and in the capacities indicated on the 23rd day of
July, 2001.
Signature Title
--------- -----
* President, Chief Executive Officer and Director
- ---------------------------------------------------
Stephen H. Binet
/s/ ALAN L. HUNTE Executive Vice President, Chief Accounting
- --------------------------------------------------- Officer and Director
Alan L. Hunte
/s/ JAMES F. BILLETT, JR. Chairman of the Board
- ---------------------------------------------------
James F. Billett, Jr.
* Director
- ---------------------------------------------------
Paul Feldsher
* Director
- ---------------------------------------------------
Robert A. Giambo
* Director
- ---------------------------------------------------
James E. Roberts
*By: /s/ ALAN L. HUNTE
---------------------------------------------
Alan L. Hunte
Attorney-in-Fact
II-8
68
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, each of
Trenwick America Capital Trust I, Trenwick America Capital Trust II and Trenwick
America Capital Trust III certifies that it has reasonable grounds to believe
that it meets all of the requirements for filing on Form S-3 and has duly caused
this Amendment No. 2 to the Registration Statement to be signed on its behalf by
the undersigned, thereunto duly authorized, in Wilmington, Delaware, on the 23rd
day of July, 2001.
Trenwick America Capital Trust I,
By: Trenwick America Corporation, as
Depositor
By: /s/ ALAN L. HUNTE
------------------------------------
Alan L. Hunte
Chief Accounting Officer
Trenwick America Capital Trust II,
By: Trenwick America Corporation, as
Depositor
By: /s/ ALAN L. HUNTE
------------------------------------
Alan L. Hunte
Chief Accounting Officer
Trenwick America Capital Trust III,
By: Trenwick America Corporation, as
Depositor
By: /s/ ALAN L. HUNTE
------------------------------------
Alan L. Hunte
Chief Accounting Officer
II-9
69
EXHIBIT INDEX
Sequential
Exhibit Page
Number Description Number
- ------- ----------- ----------
+1.1 Form of Underwriting Agreement relating to common shares,
preferred shares, depositary shares and warrants of Trenwick
Group Ltd.
+1.2 Form of Underwriting Agreement relating to debt securities
of Trenwick America Corporation, fully and unconditionally
guaranteed by Trenwick Group Ltd.
+1.3 Form of Underwriting Agreement relating to preferred
securities of Trenwick America Capital Trust I, Trenwick
America Capital Trust II and Trenwick America Capital Trust
III, fully and unconditionally guaranteed by Trenwick Group
Ltd.
+1.4 Form of Underwriting Agreement relating to share purchase
contracts of Trenwick Group Ltd.
+1.5 Form of Underwriting Agreement relating to share purchase
units of Trenwick Group Ltd.
4.1 Memorandum of Association of Trenwick Group Ltd.
(incorporated by reference to Exhibit 3.1 to the
Registration Statement on Form S-4 of Trenwick Group Ltd.
(File No. 333-44290))
4.2 Bye-laws of the Trenwick Group Ltd. (incorporated by
reference to Exhibit 3.3 to the Registration Statement on
Form S-4 of Trenwick Group Ltd. (File No. 333-44290))
4.3 Certificate of Incorporation of Trenwick America Corporation
(incorporated by reference to Exhibit 3.1 to Trenwick
America Corporation's Annual Report on Form 10-K filed on
April 2, 2001 (File No. 0-31967)
4.4 By-laws of Trenwick America Corporation (incorporated by
reference to Exhibit 3.2 to Trenwick America Corporation's
Annual Report on Form 10-K filed on April 2, 2001 (File No.
0-31967))
4.5 Rights Agreement, dated as of September 27, 2000, between
Trenwick and First Chicago Trust Company of New York
including, as Exhibit A thereto, a form of Rights
Certificate (incorporated by reference to Exhibit 4.2 to
Trenwick Group Ltd.'s Annual Report on Form 10-K filed April
2, 2001 (File No. 1-16089)
**4.6 Form of Senior Indenture between Trenwick America
Corporation, Trenwick Group Ltd. and Bank One Trust Company,
N.A.
**4.7 Form of Subordinated Indenture between Trenwick America
Corporation, Trenwick Group Ltd. and Bank One Trust Company,
N.A.
+4.8 Form of Senior Note
+4.9 Form of Subordinated Note
+4.10 Form of Common Share Warrant Provisions
+4.11 Form of Preferred Share Warrant Provisions
**4.12 Certificate of Trust of Trenwick America Capital Trust I
**4.13 Certificate of Trust of Trenwick America Capital Trust II
**4.14 Certificate of Trust of Trenwick America Capital Trust III
**4.15 Trust Agreement of Trenwick America Capital Trust I
**4.16 Trust Agreement of Trenwick America Capital Trust II
**4.17 Trust Agreement of Trenwick America Capital Trust III
**4.18 Form of Amended and Restated Trust Agreement of Trenwick
America Capital Trust I
70
.19 **4 Form of Amended and Restated Trust Agreement of Trenwick America Capital
Trust II
**4.20 Form of Amended and Restated Trust Agreement of Trenwick America Capital
Trust III
**4.21 Form of Preferred Securities Guarantee Agreement with respect to the
preferred securities issued by Trenwick America Capital Trust I
**4.22 Form of Preferred Securities Guarantee Agreement with respect to the
preferred securities issued by Trenwick America Capital Trust II
**4.23 Form of Preferred Securities Guarantee Agreement with respect to the
preferred securities issued by Trenwick America Capital Trust III
**5.1 Opinion of Appleby Spurling & Kempe regarding the validity of the common
shares, preferred shares, depositary shares and share purchase units
**5.2 Opinion of Baker & McKenzie regarding the validity of the debt
securities, debt securities guarantees, preferred securities guarantees,
warrants and stock purchase contracts
**5.3 Opinion of Richards, Layton & Finger, P.A. regarding the validity of (i)
Trenwick America Capital Trust I and (ii) the trust preferred securities
**5.4 Opinion of Richards, Layton & Finger, P.A. regarding the validity of (i)
Trenwick America Capital Trust II and (ii) the trust preferred
securities
**5.5 Opinion of Richards, Layton & Finger, P.A. regarding the validity of (i)
Trenwick America Capital Trust III and (ii) the trust preferred
securities
12.1 Statement Re: Computation of Ratios
**23.1 Consent of Appleby Spurling & Kempe (included in Exhibit 5.1)
**23.2 Consent of Baker & McKenzie (included in Exhibit 5.2)
**23.3 Consent of Richards, Layton & Finger, P.A. (included in Exhibit 5.3)
**23.4 Consent of Richards, Layton & Finger, P.A. (included in Exhibit 5.4)
**23.5 Consent of Richards, Layton & Finger, P.A. (included in Exhibit 5.5)
23.6 Consent of PricewaterhouseCoopers LLP relating to the financial
statements of Trenwick Group Ltd.
23.7 Consent of PricewaterhouseCoopers LLP relating to the financial
statements of Trenwick America Corporation
23.8 Consent of KPMG
23.9 Consent of Deloitte & Touche LLP
**24.1 Powers of Attorney (included on Pages II-6 and II-8 of this Registration
Statement)
**25.1 Statement of Eligibility of Bank One Trust Company, N.A. on Form T-1, as
trustee for the Trenwick America Corporation senior indenture
**25.2 Statement of Eligibility of Bank One Trust Company, N.A. on Form T-1, as
trustee for the Trenwick America Corporation subordinated indenture
(included in Exhibit 25.1)
**25.3 Statement of Eligibility of Bank One Trust Company, N.A. on Form T-1, as
Property Trustee for the Amended and Restated Trust Agreement of
Trenwick America Capital Trust I
71
Sequential
Exhibit Page
Number Description Number
- ------- ----------- ----------
**25.4 Statement of Eligibility of Bank One Trust Company, N.A. on
Form T-1, as Property Trustee for the Amended and Restated
Trust Agreement of Trenwick America Capital Trust II
**25.5 Statement of Eligibility of Bank One Trust Company, N.A. on
Form T-1, as Property Trustee for the Amended and Restated
Trust Agreement of Trenwick America Capital Trust III
**25.6 Statement of Eligibility of Bank One Trust Company, N.A. on
Form T-1, as Preferred Securities Guarantee Trustee under
the Preferred Securities Guarantee Agreement of Trenwick
Group Ltd. for the benefit of the holders of Preferred
Securities of Trenwick America Capital Trust I
**25.7 Statement of Eligibility of Bank One Trust Company, N.A. on
Form T-1, as Preferred Securities Guarantee Trustee under
the Preferred Securities Guarantee Agreement of Trenwick
Group Ltd. for the benefit of the holders of Preferred
Securities of Trenwick America Capital Trust II (included in
Exhibit 25.6)
**25.8 Statement of Eligibility of Bank One Trust Company, N.A. on
Form T-1, as Preferred Securities Guarantee Trustee under
the Preferred Securities Guarantee Agreement of Trenwick
Group Ltd. for the benefit of the holders of Preferred
Securities of Trenwick America Capital Trust III (included
in Exhibit 25.6)
- ---------------
** Previously filed.
+ To be filed, if necessary, subsequent to the effectiveness of this
registration statement by an amendment to this registration statement or
incorporated by reference pursuant to a Current Report on Form 8-K in
connection with the offering of securities.