SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
Current Report Pursuant to Section 13 or 15(d)
of the Securities Exchange Act of 1934
March 15, 2001
- --------------------------------------------------------------------------------
Date of Report (Date of earliest event reported)
Arch Capital Group Ltd.
- --------------------------------------------------------------------------------
(Exact name of registrant as specified in its charter)
Bermuda 0-26456 N/A
- ----------------- ----------------------------------- -------------------------
(State or other (Commission File Number) (I.R.S. Employer
jurisdiction of Identification No.)
incorporation or
organization)
20 Horseneck Lane, Greenwich, Connecticut 06830
- --------------------------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number,
including area code:
(203) 862-4300
Not Applicable
- --------------------------------------------------------------------------------
(Former name or former address, if changed since last report)
ITEM 2. Acquisition or Disposition of Assets
On February 28, 2001, Arch Capital Group Ltd., a Bermuda corporation
("ACGL"), acquired all of the capital stock of American Independent Insurance
Holding Company ("AIIHC"), a Pennsylvania corporation. The acquisition was made
pursuant to the terms and subject to the conditions set forth in a certain
reorganization agreement (the "Reorganization Agreement"), dated as of December
31, 2000, by and among AIIHC, Lewis Small, Richard Small Voting Trust, David
Wilstein, Leonard Wilstein, Denise Wilstein, Gary Wilstein, Ronald Wilstein, BCI
Holdings, Inc., American Independent Company Voting Trust (together with Lewis
Small, Richard Small Voting Trust, David Wilstein, Leonard Wilstein, Denise
Wilstein, Gary Wilstein, Ronald Wilstein and BCI Holdings, Inc., the "Selling
Stockholders"), TDH Capital Partners, a Delaware business trust ("TDHCP"), TDH
III, L.P., a Delaware limited partnership ("TDH III" and, together with TDHCP,
"TDH"), and ACGL, the execution version of which is set forth as an exhibit
hereto.
As more fully described in the Reorganization Agreement, ACGL purchased a
portion of the common shares of AIIHC held by the Selling Stockholders for $1.25
million. The remainder of the outstanding common shares of AIIHC were redeemed
by the Company in exchange for the right to receive a distribution with respect
to any proceeds received as a result of the final adjudication or settlement of
certain lawsuits to which AIIHC, as a plaintiff, is currently involved (the
"Lawsuits"). TDH also returned certain warrants to purchase AIIHC common shares
for cancellation and forgave the obligations owing to it under certain notes
issued by AIIHC in an aggregate principal amount of $4.0 million in exchange for
the right to receive a distribution with respect to any proceeds received as a
result of the final adjudication or settlement of the Lawsuits. Immediately
after the foregoing transactions, ACGL contributed notes issued by AIIHC in an
aggregate principal amount of $8.5 million to the capital of AIIHC and returned
certain warrants to purchase AIIHC common shares for cancellation.
Immediately after the closing of the transaction, ACGL made a capital
contribution to AIIHC which, in turn, made a capital contribution to its
operating insurance company subsidiary, American Independent Insurance Company
("AIIC") in the amount of $9.5 million.
In addition, pursuant to a letter agreement dated as of December 28, 2000,
between Folksamerica Reinsurance Company ("Folksamerica"), ACGL and AIIHC,
Folksamerica agreed to release AIIC from the reinsurance commitments transferred
to Folksamerica under the letter dated as of February 16, 2000 from Arch
Reinsurance Company to AIIC in exchange for a release fee, paid by ACGL, of $1.5
million. ACGL paid the release fee on December 29, 2000.
-3-
ITEM 7. Financial Statements and Exhibits
(a) Financial Statements of Business Acquired.
It is impractical to provide the required financial statements of American
Independent Insurance Holding Company at the time of filing of this Report. It
is anticipated that such financial statements will be filed by amendment as soon
as practicable but in no event later than 60 days following the date on which
this Report must be filed.
(b) Pro Forma Financial Information.
It is impractical to provide the required financial information with
respect to American Independent Insurance Holding Company at the time of filing
of this Report. It is anticipated that such financial information will be filed
by amendment as soon as practicable but in no event later than 60 days following
the date on which this Report must be filed.
(c) Exhibits.
10.1. Reorganization Agreement, dated as of December 31, 2000, by and among
AIIHC, the Selling Stockholders, TDH, and ACGL.
99.1. Press Release, dated January 3, 2001.
99.2. Press Release, dated February 28, 2001.
-4-
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, as
amended, the registrant has duly caused this report to be signed on its behalf
by the undersigned.
ARCH CAPITAL GROUP LTD.
Date: March 15, 2001 By: /s/ Louis T. Petrillo
-------------------
Louis T. Petrillo
Senior Vice President,
General Counsel and Secretary