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[LETTERHEAD OF HAYNES AND BOONE, LLP]
EXHIBIT 5.1
April 5, 2001
HCC Insurance Holdings, Inc.
13403 Northwest Freeway
Houston, Texas 77040-6094
Ladies and Gentlemen:
We have acted as counsel for HCC Insurance Holdings, Inc., a Delaware
corporation (the "Company") with respect to certain legal matters in connection
with the registration by the Company, under the Securities Act of 1933, as
amended (the "Securities Act"), of the offer and sale by the Company from time
to time, pursuant to Rule 415 under the Securities Act, of (1) unsecured debt
securities of the Company, which may be either senior or subordinated and may be
issued in one or more series, consisting of notes, debentures or other evidences
of indebtedness (the "Debt Securities"), (2) shares of common stock, $1.00 par
value, of the Company (the "Common Stock"), (3) shares of preferred stock, $.01
par value, of the Company (the "Preferred Stock"), and (4) warrants for the
purchase of Common Stock (the "Warrants" and, together with the Debt Securities,
Common Stock and the Preferred Stock, the "Securities").
This opinion is further delivered in connection with the offer and sale
by the Company and HCC Capital Trust I and HCC Capital Trust II, each a business
trust formed under the Business Trust Act of the state of Delaware (each an "HCC
Trust", and collectively, the "HCC Trusts" and together with the Company, the
"Registrants") in connection with registration under the Securities Act by the
Registrants of (1) preferred securities of each of the HCC Trusts (the "Trust
Preferred Securities"); (2) guarantees by the Company of any Trust Preferred
Securities issued by each HCC Trust pursuant to a Guarantee Agreement to be
executed by the Company (the "Guarantees"); and (3) unsecured debt securities of
the Company (the "Trust Debt Securities"). The Trust Debt Securities, the Trust
Preferred Securities and the Guarantees are collectively referred to herein as
the "Offered Trust Securities."
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April 5, 2001
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The aggregate initial offering price of the Securities and the Offered
Trust Securities to be offered and sold by Registrants, pursuant to a
registration statement on Form S-3 (the "Registration Statement"), to which this
opinion is an exhibit, will not exceed $261,115,000. The Securities will be
offered in amounts, at prices, and on terms to be determined in light of market
conditions at the time of sale and to be set forth in supplements to the
prospectus (each a "Prospectus Supplement") contained in the Registration
Statement.
We have examined originals or copies, certified or otherwise identified
to our satisfaction, of (1) the Certificate of Incorporation and Bylaws of the
Company, each as amended and/or restated to the date hereof, (2) the
Registration Statement, (3) the organizational documents of each of the HCC
Trusts; and (4) such other certificates, statutes, instruments and documents as
we considered appropriate for purposes of the opinions hereafter expressed. In
addition, we have further examined (1) the proposed form of Indenture for Trust
Debt Securities or Debt Securities from the Company to First Union National
Bank, as Trustee (the "Indenture") providing for the issuance of the Trust Debt
Securities or Debt Securities from time to time in one or more series pursuant
to the terms of one or more Securities Resolutions (as defined in the Indenture)
creating such series; (2) Trust Agreements among the Company, First Union
National Bank, as Property Trustee and First Union Trust Company, N.A., as
Delaware Trustee (the "Trust Agreements"); (3) other exhibits to the
Registration Statement relating to the Securities and the Offered Trust
Securities; and (4) corporate proceedings of the Registrants relating to the
Registration Statement, the Indenture, the Trust Agreements, the Guarantees and
the transactions contemplated thereby. In addition, we reviewed such questions
of law we considered appropriate.
In connection with this opinion, we have assumed that (i) the
Registration Statement, and any amendments thereto (including post-effective
amendments), will have become effective; (ii) a Prospectus Supplement will have
been prepared and filed with the Securities and Exchange Commission (the
"Commission") describing the Securities or Offered Trust Securities offered
thereby; (iii) all Securities and Offered Trust Securities will be issued and
sold in compliance with applicable federal and state securities laws and in the
manner stated in the Registration Statement and the applicable Prospectus
Supplement; (iv) the Indentures, a warrant agreement ("Warrant Agreement")
relating to the Warrants, each Trust Agreement and the Guarantees will each be
duly authorized, executed and delivered by the parties thereto; (v) each person
signing an Indenture, a Warrant Agreement, a Trust Agreement and a Guarantee
will have the legal capacity and authority to do so; (vi) at the time of any
offering or sale of any shares of Common Stock, that the Company shall have such
number of shares of Common Stock, as set forth in such
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April 5, 2001
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offering or sale, authorized or created and available for issuance; (vii) at the
time of any offering or sale of any shares of Preferred Stock, that the Company
shall have such number of shares of Preferred Stock, as set forth in such
offering or sale, authorized or created and available for issuance; (viii) a
definitive purchase, underwriting or similar agreement with respect to any
Securities or Offered Trust Securities offered will have been duly authorized
and validly executed and delivered by the Company and the other parties thereto;
and (ix) any Securities or Offered Trust Securities issuable upon conversion,
exchange or exercise of any Debt Securities, Warrant or Trust Debt Securities
being offered will have been duly authorized, created and, if appropriate,
reserved for issuance upon such conversion, exchange or exercise.
Based on the foregoing, and subject to the assumptions, qualifications,
limitations, and exceptions set forth herein, we are of the opinion that:
(i) When (a) the applicable Indenture relating either to senior Debt
Securities, subordinated Debt Securities or Trust Debt Securities
has been duly qualified under the Trust Indenture Act of 1939, as
amended, (b) the Board of Directors of the Company (or a
committee thereof) and/or the HCC Trusts has taken all necessary
corporate or similar action to approve the issuance and terms of
any such Debt Securities or Trust Debt Securities or Guarantee,
(c) the terms of such Debt Securities or Trust Debt Securities or
Guarantee and of their issuance and sale have been duly
established in conformity with the applicable Indenture so as not
to violate any applicable law or result in a default under or
breach of any agreement or instrument binding upon the Company or
the HCC Trusts and so as to comply with any requirements or
restrictions imposed by any court or governmental body having
jurisdiction over the Company or the HCC Trusts, (d) any shares
of Common Stock issuable upon the conversion of such Debt
Securities or Trust Debt Securities, if applicable, have been
duly and validly authorized for issuance and (e) such Debt
Securities or Trust Debt Securities have been duly executed and
authenticated in accordance with the applicable Indenture and
issued and sold as contemplated in the Registration Statement,
such Debt Securities, Trust Debt Securities or Guarantee will
constitute valid and legally binding obligations of the Company
and/or the applicable HCC Trust respectively, subject to
bankruptcy, insolvency (including, without limitation, all laws
relating to fraudulent transfers), reorganization, moratorium and
similar laws relating to or affecting creditors' rights generally
and to general equitable principles (regardless of whether
enforcement is sought in a proceeding in equity
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April 5, 2001
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or at law), and the qualification that the remedy of specific
performance and injunctive or other forms of equitable relief may
be subject to equitable defenses and to the discretion of the
court before which any proceeding may be brought.
(ii) When (a) the terms of any Warrant and of their issuance and sale
have been duly established in conformity with the applicable
Warrant Agreement so as not to violate any applicable law or
result in a default under, or breach of, any agreement or
instrument binding upon the Company and so as to comply with any
requirements or restrictions imposed by any court or governmental
body having jurisdiction over the Company, and (b) the Warrants
have been duly executed and authenticated in accordance with the
applicable Warrant Agreement and issued and sold as contemplated
in the Registration Statement, the Warrants will constitute valid
and legally binding obligations of the Company, subject to
bankruptcy, insolvency (including, without limitation, all laws
relating to fraudulent transfers), reorganization, moratorium and
similar laws relating to or affecting creditors' rights generally
and to general equitable principles (regardless of whether
enforcement is sought in a proceeding in equity or at law.
(iii) Upon the fixing of the designations, relative rights, preferences
and limitations of any series of Preferred Stock by the Board of
Directors of the Company in conformity with the Delaware General
Corporation Law and the Certificate of Incorporation, as amended,
of the Company and upon the approval by the Board of Directors of
the Company of the specific terms of the issuance, all necessary
corporate action on the part of the Company will have been taken
to authorize the issuance and sale of such series of Preferred
Stock proposed to be sold by the Company, and when such shares of
Preferred Stock are issued and delivered against payment therefor
for an amount in excess of the par value thereof, and, if issued
upon the exercise or conversion of any Warrants or Debt
Securities, issued and delivered as contemplated by the terms
thereof and of any Warrant Agreement or the applicable Indenture,
respectively, relating thereto, such shares will be validly
issued, fully paid and non-assessable.
(iv) The Common Stock when authorized and sold as contemplated in the
Registration Statement, will be duly authorized, validly issued,
fully-paid and non-assessable.
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April 5, 2001
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As to the legality of the Trust Preferred Securities to be issued by
the HCC Trusts, you are receiving the opinion of Richards, Layton & Finger,
special Delaware counsel to the HCC Trusts and the Company.
We hereby consent to the filing of this opinion as an exhibit to the
Registration Statement and to the use of our name in the Prospectus forming a
part of the Registration Statement and to the filing of this opinion as Exhibit
5 to the Registration Statement. In giving this consent, we do not admit that we
are within the category of persons whose consent is required under Section 7 of
the Securities Act and the rules and regulations thereunder.
Very truly yours,
HAYNES AND BOONE, LLP
/s/ HAYNES AND BOONE, LLP
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