Exhibit 1.1
Execution Version
$300,000,000
W. R. BERKLEY CORPORATION
5.375% Senior Notes Due 2020
UNDERWRITING AGREEMENT
September 13, 2010
September 13, 2010
Banc of America Securities LLC
As Representatives of the Several Underwriters
c/o Banc of America Securities LLC
Bank of America Tower
One Bryant Park
New York, New York 10036
Dear Sirs and Mesdames:
W. R. Berkley Corporation, a Delaware corporation (the
Company
), proposes to issue and sell
to the several Underwriters named in Schedule I hereto (the
Underwriters
) $300,000,000 principal
amount of its 5.375% Senior Notes due 2020 (the
Securities
) to be issued pursuant to the
provisions of an Indenture, dated as of February 14, 2003, as supplemented by the Seventh
Supplemental Indenture, to be dated as of September 16, 2010 (the
Indenture
), between the Company
and The Bank of New York Mellon, as Trustee (the
Trustee
).
The Company has filed with the Securities and Exchange Commission (the
Commission
) a
registration statement, including a prospectus, on Form S-3 (No. 333-155724) covering the
registration of the securities of the Company, including the Securities, under the Securities Act
of 1933, as amended (the
Securities Act
), and the offering thereof from time to time in
accordance with Rule 415 of the rules and regulations of the Commission under the Securities Act
(the
Rules and Regulations
) and the Company has filed such post-effective amendments thereto as
may be required prior to the execution of this Agreement. Promptly after execution and delivery of
this Agreement, the Company will prepare and file a final prospectus and final prospectus
supplement in accordance with the provisions of paragraph (b) of Rule 424 of the Rules and
Regulations.
Registration Statement
at any particular time means such registration statement in
the form then filed with the Commission, including any amendment thereto, any document incorporated
by reference therein and any information in a prospectus or prospectus supplement deemed or
retroactively deemed to be a part thereof pursuant to Rule 430B or 430C of the Rules and
Regulations, that in any case has not been superseded or modified.
Registration Statement
without reference to a time means the Registration Statement as of the time of the first contract
of sale for the Securities, which time shall be considered the
effective date
of such
Registration Statement relating to the Securities. For purposes of this definition, information
contained in a form of prospectus or prospectus supplement that is deemed or retroactively deemed
to be a part of the Registration Statement pursuant to Rule 430B of the Rules and Regulations shall
be considered to be included in the Registration Statement as of the time specified in Rule 430B of
the Rules and Regulations.
Statutory Prospectus
as of any particular time means the prospectus
relating to the Securities that is included in the Registration Statement immediately prior to that
time, including all
information contained in a form of prospectus or prospectus supplement deemed to be a part
thereof pursuant to Rule 430B or 430C of the Rules and Regulations that in any case has not been
superseded or modified. For purposes of this definition, information contained in a form of
prospectus (including a prospectus supplement) that is deemed or retroactively deemed to be a part
of the Registration Statement pursuant to Rule 430B of the Rules and Regulations shall be
considered to be included in the Statutory Prospectus only as of the actual time that form of
prospectus (including a prospectus supplement) is filed with the Commission pursuant to Rule 424(b)
of the Rules and Regulations and not retroactively.
Prospectus
means the Statutory Prospectus
that discloses the public offering price and other final terms of the Securities and otherwise
satisfies Section 10(a) of the Securities Act and the term
preliminary prospectus
means the
Statutory Prospectus, as supplemented by the Preliminary Prospectus Supplement, dated September 13,
2010.
For purposes of this Agreement,
Issuer Free Writing Prospectus
means any issuer free
writing prospectus, as defined in Rule 433(h) of the Rules and Regulations, relating to the
Securities in the form filed or required to be filed with the Commission or, if not required to be
filed, in the form retained or required to be retained in the Companys records pursuant to Rule
433(g) of the Rules and Regulations,
General Use Issuer Free Writing Prospectus
means any Issuer
Free Writing Prospectus that is intended for general distribution to prospective investors, as
evidenced by its being specified in Schedule II hereto and
Limited Use Issuer Free Writing
Prospectus
means any Issuer Free Writing Prospectus that is not a General Use Issuer Free Writing
Prospectus. All references to the terms Registration Statement, Prospectus and preliminary
prospectus shall be deemed to include all documents incorporated therein by reference pursuant to
the Securities Exchange Act of 1934, as amended (the
Exchange Act
). For purposes of this
Agreement, all references to the Registration Statement, Prospectus or any preliminary prospectus
or to any amendment or supplement to any of them shall be deemed to include any copy filed with the
Commission pursuant to its Electronic Data Gathering, Analysis and Retrieval System.
1.
Representations and Warranties
. The Company represents and warrants to and agrees with
each of the Underwriters that:
(a) The Registration Statement has become effective; no stop order suspending the
effectiveness of the Registration Statement is in effect, and no proceedings for such
purpose are pending before or, to the knowledge of the Company, threatened by the
Commission.
(b) (i) (A) At the time the Registration Statement initially became effective, (B) at
the time of each amendment thereto for the purposes of complying with Section 10(a)(3) of
the Securities Act (whether by post-effective amendment, incorporated report or form of
prospectus), (C) at the effective time of the Registration Statement relating to the
Securities and (D) on the Closing Date, the Registration Statement conformed and will
confirm in all material respects to the requirements of the Securities Act and the Rules and
Regulations and did not include any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary to make the statements therein not
misleading, (ii) (A) on its date, (B) at the time of filing the Prospectus pursuant to Rule
424(b) of the Rules and Regulations and (C) on the Closing Date, the
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Prospectus will conform in all material respects to the requirements of the Securities
Act and the Rules and Regulations, (iii) as of 2:45 p.m. New York City time on the date of
this Agreement (the
Applicable Time
), neither the General Use Issuer Free Writing
Prospectus issued at or prior to the Applicable Time and the Statutory Prospectus identified
in Schedule II attached hereto and all other documents set forth on Schedule II, all
considered together (collectively, the
General Disclosure Package
), nor any individual
Limited Use Issuer Free Writing Prospectus, when considered together with the General
Disclosure Package, included any untrue statement of a material fact or omitted to state
any material fact necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading, except that the foregoing does not
apply to (A) statements in or omissions from any prospectus included in the Registration
Statement or any Issuer Free Writing Prospectus in reliance upon or in conformity with
written information furnished to the Company by any Underwriter through the representative
or representatives of the Underwriter (the
Representatives
) specifically for use therein,
(iv) (A) on its date, (B) at the time of its filing pursuant to Rule 424(b) of the Rules and
Regulations and (C) on the Closing Date, the Prospectus does not include and will not
include any untrue statement of a material fact or omit to state any material fact required
to be stated therein, in light of the circumstances under which they were made, or necessary
to make the statements therein not misleading, except that the foregoing does not apply to
(A) statements in or omissions from any of such documents based upon written information
furnished to the Company by any Underwriter through the Representatives specifically for use
therein or (B) that part of the Registration Statement that constitutes the Statement of
Eligibility (Form T-1) under the Trust Indenture Act of 1939, as amended (the
Trust
Indenture Act
), of the Trustee; and (v) the documents incorporated by reference in the
Prospectus, at the time they were, or hereafter, are filed with the Commission, complied
and, at any time when a prospectus relating to the Securities is required (or would be
required, but for the provisions of Rule 172 of the Rules and Regulations) to be delivered
under the Securities Act in connection with sales by any Underwriter or dealer, will comply
as to form in all material respects with the requirements of the Exchange Act and the rules
and regulations thereunder.
(c) At the earliest time after the filing of the Registration Statement that the
Company or another offering participant made a
bona fide
offer (within the meaning of Rule
164(h)(2) of the Rules and Regulations) of the Securities and at the date of this Agreement,
the Company was not and is not an ineligible issuer as defined in Rule 405 of the Rules
and Regulations.
(d) Each Issuer Free Writing Prospectus, as of its issue date and at all subsequent
times through the completion of the public offer and sale of the Securities or until any
earlier date that the Company notified or notifies the Representatives as described in the
next sentence, did not, does not and will not include any information that conflicted,
conflicts or will conflict with the information then contained in the Registration
Statement. If at any time following issuance of an Issuer Free Writing Prospectus there
occurred or occurs an event or development as a result of which such Issuer Free Writing
Prospectus conflicted or would conflict with the information then contained in the
Registration Statement or as result of which such Issuer Free Writing Prospectus, if
republished immediately following such event or development, would
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include an untrue statement of a material fact or would omit to state a material fact
necessary in order to make the statements therein, in light of the circumstances under which
they were made, not misleading, (A) the Company has promptly notified or will promptly
notify the Representatives and (B) the Company has promptly amended or will promptly amend
or supplement such Issuer Free Writing Prospectus to eliminate or correct such conflict,
untrue statement or omission.
(e) The Company has been duly incorporated and is an existing corporation in good
standing under the laws of the State of Delaware, with power and authority (corporate and
other) to own its properties and conduct its business as described in the General Disclosure
Package and the Prospectus; and the Company is duly qualified to do business as a foreign
corporation in good standing in all other jurisdictions in which its ownership or lease of
property or the conduct of its business requires such qualification, except in such
jurisdictions where the failure to be so qualified would not individually or in the
aggregate have a material adverse effect on the condition (financial or other), business,
properties or results of operations of the Company and its subsidiaries taken as a whole
(
Material Adverse Effect
).
(f) Each Significant Subsidiary (as defined below) of the Company has been duly
incorporated and is an existing corporation in good standing under the laws of the
jurisdiction of its incorporation, with power and authority (corporate and other) to own its
properties and conduct its business as described in the General Disclosure Package and the
Prospectus; and each Significant Subsidiary of the Company is, to the extent applicable,
duly qualified to do business as a foreign corporation in good standing in all other
jurisdictions in which its ownership or lease of property or the conduct of its business
requires such qualification, except where the failure to be so qualified would not
individually or in the aggregate have a Material Adverse Effect; all of the issued and
outstanding capital stock of each Significant Subsidiary of the Company has been duly
authorized and validly issued and is fully paid and nonassessable; and the capital stock of
each Significant Subsidiary owned by the Company, directly or through subsidiaries, is owned
free from liens, encumbrances and defects. As used herein,
Significant Subsidiaries
means
Admiral Insurance Company, Berkley Regional Insurance Company, Berkley Insurance Company and
Nautilus Insurance Company, which are currently the only operating insurance companies that
are significant subsidiaries of the Company as that term is defined in Rule 1-02(w) of
Regulation S-X of the Rules and Regulations.
(g) The Indenture has been duly qualified under the Trust Indenture Act and has been
duly authorized, and on the Closing Date (as defined below) will be duly executed and
delivered by the Company and a valid and binding agreement of the Company, enforceable in
accordance with its terms except as (i) the enforceability thereof may be limited by
bankruptcy, insolvency or similar laws affecting creditors rights generally and (ii) rights
of acceleration and the availability of equitable remedies may be limited by equitable
principles of general applicability.
(h) The Securities have been duly authorized and, when executed and authenticated in
accordance with the provisions of the Indenture and delivered to and
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paid for by the Underwriters in accordance with the terms of this Agreement on the
Closing Date, such Securities will be duly executed, authenticated, issued and delivered and
entitled to the benefits of the Indenture and will be valid and binding obligations of the
Company, enforceable in accordance with their terms except as (i) the enforceability thereof
may be limited by bankruptcy, insolvency or similar laws affecting creditors rights
generally and (ii) rights of acceleration and the availability of equitable remedies may be
limited by equitable principles of general applicability; and the Securities and the
Indenture will conform to the information in the General Disclosure Package and will conform
to the descriptions thereof in the Prospectus.
(i) Except as disclosed in the General Disclosure Package and the Prospectus, there are
no contracts, agreements or understandings between the Company and any person that would
give rise to a valid claim against the Company or any Underwriter for a brokerage
commission, finders fee or other like payment in connection with this offering.
(j) There are no contracts, agreements or understandings between the Company and any
person granting such person the right to require the Company to file a registration
statement under the Securities Act with respect to any securities of the Company owned or to
be owned by such person or to require the Company to include such securities in the
securities registered pursuant to the Registration Statement or in any securities being
registered pursuant to any other registration statement filed by the Company under the
Securities Act.
(k) No consent, approval, authorization, or order of, or filing with, any governmental
agency or body or any court is required for the performance by the Company of its
obligations under this Agreement, the Indenture or the Securities, except such as have been
obtained and made under the Securities Act, as contemplated under Section 5(a) hereof, and
such as may be required under state securities laws.
(l) The execution and delivery of, and the performance by the Company of its
obligations under, this Agreement, the Indenture and the Securities will not result in a
breach or violation of any of the terms and provisions of, or constitute a default under,
any statute, any rule, regulation or order of any governmental agency or body or any court,
domestic or foreign, having jurisdiction over the Company or any Significant Subsidiaries of
the Company or any of their material properties, or any material agreement or instrument to
which the Company or any such subsidiary is a party or by which the Company or any such
subsidiary is bound or to which any of the properties of the Company or any such subsidiary
is subject, or the charter or by-laws of the Company or any such subsidiary, and the Company
has full power and authority to authorize, issue and sell the Securities as contemplated by
this Agreement.
(m) This Agreement has been duly authorized, executed and delivered by the Company.
(n) Except as disclosed in the General Disclosure Package and the Prospectus, the
Company and its Significant Subsidiaries have good and marketable title to all real
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properties and all other properties and assets owned by them, in each case free from
liens, encumbrances and defects that would affect the value thereof or interfere with the
use made or to be made thereof by them, other than liens, encumbrances and defects that
would not individually or in the aggregate have a Material Adverse Effect; and except as
disclosed in the General Disclosure Package and the Prospectus, the Company and its
subsidiaries hold any leased real or personal property under valid and enforceable leases
with no exceptions that would individually or in the aggregate have a Material Adverse
Effect.
(o) The Company and its Significant Subsidiaries possess adequate certificates,
authorities or permits issued by appropriate governmental agencies or bodies necessary to
conduct the business now operated by them and have not received any notice of proceedings
relating to the revocation or modification of any such certificate, authority or permit
that, if determined adversely to the Company or any of its Significant Subsidiaries, would
individually or in the aggregate have a Material Adverse Effect.
(p) The Company has made all required filings under applicable insurance holding
company statutes, and has received approvals of acquisition of control and/or affiliate
transactions, in each jurisdiction in which such filings or approvals are required, except
where the failure to have made such filings or receive such approvals in any such
jurisdiction would not have individually or in the aggregate a Material Adverse Effect; each
of the Companys Significant Subsidiaries that is required to be organized and licensed as
an insurance or reinsurance company (the
Insurance Subsidiaries
) in its jurisdiction of
incorporation is duly organized and licensed as an insurance or reinsurance company in its
respective jurisdiction of incorporation, and each such Significant Subsidiary is duly
licensed or authorized as an insurer or reinsurer (the
Insurance Licenses
) in each other
jurisdiction in which such licensing or authorization is required, except where the failure
to be so licensed or authorized in any such jurisdiction would not have individually or in
the aggregate a Material Adverse Effect; there is no pending or, to the knowledge of the
Company, threatened action, suit, proceeding or investigation that would reasonably be
expected to lead to the revocation, termination or suspension of any such Insurance
Licenses, the revocation, termination or suspension of which would have individually or in
the aggregate a Material Adverse Effect; and except as disclosed in the General Disclosure
Package and the Prospectus, no insurance regulatory agency or body has issued any order or
decree impairing, restricting or prohibiting the payment of dividends of any Company
subsidiary to its respective parent which would have individually or in the aggregate a
Material Adverse Effect.
(q) The Company and each of its Significant Subsidiaries is in compliance with the
requirements of all laws, ordinances, governmental rules or regulations or court decrees to
which it may be subject, and has filed all notices, reports, documents or other information
required to be filed thereunder, except where the failure to so comply or file would not
individually or in the aggregate have a Material Adverse Effect.
(r) Except as disclosed in the General Disclosure Package and the Prospectus, neither
the Company nor any of its Insurance Subsidiaries is in violation of, or in default in the
performance, observance or fulfillment of, any obligation, agreement, covenant or
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condition contained in reinsurance treaties, contracts, agreements and arrangements to
which the Company or any of its Insurance Subsidiaries is a party, except for such
violations or defaults which would not individually or in the aggregate have a Material
Adverse Effect; neither the Company nor any of its Insurance Subsidiaries has received any
notice from any of the other parties to such treaties, contracts, agreements or arrangements
that such other party intends not to perform its obligations thereunder and none of them has
any reason to believe that any of the other parties to such treaties, contracts, agreements
or arrangements will be unable to perform its obligations thereunder, except to the extent
that such nonperformance would not individually or in the aggregate have a Material Adverse
Effect.
(s) To the knowledge of the Company and its Insurance Subsidiaries, no change in any
insurance law or regulation is pending that would reasonably be expected to have
individually or in the aggregate a Material Adverse Effect, except as described in the
General Disclosure Package and the Prospectus.
(t) No labor dispute with the employees of the Company or any Significant Subsidiary
exists or, to the knowledge of the Company, is imminent that would reasonably be expected to
have individually or in the aggregate a Material Adverse Effect.
(u) The Company and its subsidiaries own, possess or can acquire on reasonable terms,
adequate trademarks, trade names and other rights to inventions, know-how, patents,
copyrights, confidential information and other intellectual property (collectively,
intellectual property rights
) materially necessary to conduct the business now operated by
them and have not received any notice of infringement of or conflict with asserted rights of
others with respect to any intellectual property rights that, if determined adversely to the
Company or any of its subsidiaries, would individually or in the aggregate have a Material
Adverse Effect.
(v) Except as disclosed in the General Disclosure Package and the Prospectus, neither
the Company nor any of its subsidiaries is in violation of any statute, any rule,
regulation, decision or order of any governmental agency or body or any court, domestic or
foreign, relating to the use, disposal or release of hazardous or toxic substances or
relating to the protection or restoration of the environment or human exposure to hazardous
or toxic substances (collectively,
environmental laws
), owns or operates any real
property contaminated with any substance that is subject to any environmental laws, is
liable for any off-site disposal or contamination pursuant to any environmental laws, or is
subject to any claim relating to any environmental laws, which violation, contamination,
liability or claim would individually or in the aggregate have a Material Adverse Effect;
and the Company is not aware of any pending investigation which would reasonably be expected
to lead to such a claim.
(w) Except as disclosed in the General Disclosure Package and the Prospectus, there are
no pending actions, suits or proceedings against or affecting the Company, any of its
subsidiaries or any of their respective properties that would individually or in the
aggregate have a Material Adverse Effect, or would materially and adversely affect the
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ability of the Company to perform its obligations under this Agreement; and no such
actions, suits or proceedings are, to the Companys knowledge, threatened or contemplated.
(x) KPMG LLP, who have certified the financial statements and supporting schedules of
the Company and its subsidiaries contained in the General Disclosure Package and the
Prospectus, are independent public accountants within the meaning of the Securities Act and
the Rules and Regulations; except as disclosed in the General Disclosure Package and the
Prospectus, the financial statements included or incorporated by reference in the
Registration Statement and the General Disclosure Package and the Prospectus present fairly
the financial position of the Company and its consolidated subsidiaries as of the dates
shown and their results of operations and cash flows for the periods shown; except as
disclosed in the General Disclosure Package and the Prospectus, such financial statements
have been prepared in conformity with the generally accepted accounting principles in the
United States applied on a consistent basis; except as disclosed in the General Disclosure
Package and the Prospectus, the schedules included or incorporated in the Registration
Statement present fairly the information required to be stated therein; and except as
disclosed in the General Disclosure Package and the Prospectus, the Company and its
Insurance Subsidiaries have made no material change in their insurance reserving practices
since the most recent audited financial statements included in the General Disclosure
Package and the Prospectus.
(y) The statutory annual and quarterly statements of the Insurance Subsidiaries
required to file such statutory statements and the statutory balance sheets and income
statements included in such statutory annual and quarterly statements, most recently filed
in each jurisdiction, have been prepared in conformity with required or permitted or
prescribed statutory accounting principles or practices applied on a consistent basis,
except as may otherwise be indicated in the notes thereto, and present fairly the financial
position of the Insurance Subsidiaries (on a statutory basis) for the period covered
thereby.
(z) The Company and its subsidiaries maintain a system of internal accounting controls
sufficient to provide reasonable assurance that (i) transactions are executed in accordance
with managements general or specific authorizations; (ii) transactions are recorded as
necessary to permit preparation of financial statements in conformity with United States
generally accepted accounting principles and to maintain asset accountability; (iii) access
to assets is permitted only in accordance with managements general or specific
authorization; and (iv) the recorded accountability for assets is compared with the existing
assets at reasonable intervals and appropriate action is taken with respect to any
differences.
(aa) Except as disclosed in the General Disclosure Package and the Prospectus and
except for regular dividends declared or paid consistent with past practice, since the date
of the latest audited financial statements included in the General Disclosure Package and
the Prospectus, (i) there has been no material adverse change, nor any development or event
involving a prospective material adverse change, in the condition
(financial or other),
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business, properties or results of operations of the Company and its
subsidiaries taken as a whole, (ii) there have not been any transactions entered into by the
Company or any of its subsidiaries other than in the ordinary course of business which are
material to the Company and its subsidiaries taken as a whole, and, (iii) there has been no
dividend or distribution of any kind declared, paid or made by the Company on any class of
its capital stock.
(bb) The Company is not and, after giving effect to the offering and sale of the
Securities and the application of the proceeds thereof as described in the General
Disclosure Package and the Prospectus, will not be an investment company as defined in the
Investment Company Act of 1940, as amended (the
Investment Company Act
).
2.
Agreements to Sell and Purchase
. The Company hereby agrees to sell to the several
Underwriters, and each Underwriter, upon the basis of the representations and warranties herein
contained, but subject to the conditions hereinafter stated, agrees, severally and not jointly, to
purchase from the Company the respective principal amount of Securities set forth in Schedule I
hereto opposite its name at 99.060% of their principal amount (the
Purchase Price
) plus accrued
interest, if any, from September 16, 2010 to the date of payment and delivery.
3.
Terms of Public Offering.
The Company is advised by you that the Underwriters propose to
make a public offering of their respective portions of the Securities as soon after the
Registration Statement and this Agreement have become effective as in your judgment is advisable.
The Company is further advised by you that the Securities are to be offered to the public initially
at 99.710% of their principal amount (the
Public Offering Price
) plus accrued interest, if any,
from September 16, 2010 to the date of payment and delivery and to certain dealers selected by you
at a price that represents a concession not in excess of 0.400% of their principal amount under the
Public Offering Price, and that any Underwriter may allow, and such dealers may reallow, a
concession to certain other dealers not to exceed 0.250% of the principal amount of the Securities.
4.
Payment and Delivery.
Payment for the Securities shall be made to the Company in Federal
or other funds immediately available in New York City against delivery of such Securities at 9:00
a.m., New York City time, on September 16, 2010, or at such other time on the same or such other
date, not later than September 23, 2010, as shall be designated in writing by you. The time and
date of such payment are hereinafter referred to as the
Closing Date
.
Certificates for the Securities shall be in global form and registered in such names and in
such denominations as you shall request in writing not later than one full business day prior to
the Closing Date. The certificates evidencing the Securities shall be delivered to you on the
Closing Date for the respective accounts of the several Underwriters, with any transfer taxes
payable in connection with the transfer of the Securities to the Underwriters duly paid, against
payment of the Purchase Price therefor plus accrued interest, if any, to the date of payment and
delivery.
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5.
Covenants of the Company.
In further consideration of the agreements of the Underwriters
herein contained, the Company covenants with each Underwriter as follows:
(a) The Company has filed or will file each Statutory Prospectus (including the
Prospectus) with the Commission pursuant to and in accordance with Rule 424(b) not later
than the second business day following the earlier of the date it is first used or the
execution and delivery of this Agreement. The Company has complied and will comply with
Rule 433 of the Rules and Regulations.
(b) The Company will advise the Representatives promptly of any proposal to amend or
supplement the Registration Statement, the Prospectus or the General Disclosure Package and
will afford the Representatives a reasonable opportunity to comment on any such proposed
amendment or supplement;
provided
,
however
, that the Company shall not file any such
proposed amendment or supplement to which the Representatives reasonably object; and the
Company will also advise the Representatives promptly of the filing of any such amendment or
supplement and of the institution by the Commission of any stop order proceedings in respect
of the Registration Statement or of any part thereof and will use its best efforts to
prevent the issuance of any such stop order and to obtain as soon as possible its lifting,
if issued.
(c) The Company represents and agrees that, unless it obtains the prior consent of the
Representatives, and each Underwriter represents and agrees that, unless it obtains the
prior consent of the Company and the Representatives, it has not made and will not make any
offer relating to the Securities that would constitute an Issuer Free Writing Prospectus, or
that would otherwise constitute a free writing prospectus, as defined in Rule 405 of the
Rules and Regulations, required to be filed with the Commission. Any such free writing
prospectus consented to by the Company and the Representatives is hereinafter referred to as
a
Permitted Free Writing Prospectus
. The Company represents that it has treated and
agrees that it will treat each Permitted Free Writing Prospectus as an issuer free writing
prospectus, as defined in Rule 433 of the Rules and Regulations, and has complied and will
comply with the requirements of Rules 164 and 433 of the Rules and Regulations applicable to
any Permitted Free Writing Prospectus, including timely Commission filing where required,
legending and record keeping.
(d) The Company will prepare a final term sheet relating to the Securities, containing
only information that describes the final terms of the Securities and otherwise in a form
consented to by the Representatives, and will file such final term sheet within the period
required by Rule 433(d)(5)(ii) of the Rules and Regulations following the date such final
terms have been established for all classes of the offering of the Securities. Any such
final term sheet is an Issuer Free Writing Prospectus and a Permitted Free Writing
Prospectus for purposes of this Agreement. The Company also consents to the use by any
Underwriter of a free writing prospectus that contains only (i)(x) information describing
the preliminary terms of the Securities or their offering or (y) information that describes
the final terms of the Securities or their offering and that is included in the final term
sheet of the Company contemplated in the first sentence of this subsection or (ii) other
information that is not issuer information, as defined in Rule 433 of the Rules and
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Regulations, it being understood that any such free writing prospectus referred to in
clause (i) or (ii) above shall not be an Issuer Free Writing Prospectus for purposes of this
Agreement.
(e) If, at any time when a prospectus relating to the Securities as in the opinion of
counsel for the Underwriters is (or but for the exemption in Rule 172 would be) required to
be delivered under the Securities Act in connection with sales by any Underwriter or dealer,
any event occurs as a result of which the General Disclosure Package or the Prospectus as
then amended or supplemented would include an untrue statement of a material fact or omit to
state any material fact necessary to make the statements therein, in the light of the
circumstances under which they were made, not misleading, or if for any other reason it
shall be necessary during the same period to amend or supplement the General Disclosure
Package or the Prospectus or to file under the Exchange Act any document incorporated by
reference in the Prospectus in order to comply with the provisions of the Securities Act,
the Exchange Act or the Trust Indenture Act, the Company promptly will notify the
Representatives of such event, and if such event shall occur or if, in the opinion of
counsel for the Underwriters, it is necessary at any time to amend the General Disclosure
Package or the Prospectus to comply with the Securities Act, the Company will promptly
prepare and file with the Commission, at its own expense, an amendment or supplement which
will correct such statement or omission or an amendment which will effect such compliance.
Neither the Representatives consent to, nor the Underwriters delivery of, any such
amendment or supplement shall constitute a waiver of any of the conditions set forth in
Section 6 hereof.
(f) As soon as practicable, but not later than 16 months, after the date of this
Agreement, the Company will make generally available to its securityholders an earnings
statement covering a period of at least 12 months beginning after the date of this Agreement
and satisfying the provisions of Section 11(a) of the Securities Act and Rule 158 of the
Rules and Regulations.
(g) The Company will furnish to the Representatives copies of the Registration
Statement, including all exhibits, any related preliminary prospectus, any related
preliminary prospectus supplement, the Prospectus, any Issuer Free Writing Prospectus and
all amendments and supplements to such documents, in each case prior to 3:00 P.M. New York
City time on the business day next succeeding the date of this Agreement or as soon as
possible, with respect to any amendment or supplement, during the period mentioned in
Section 5(c) above and in such quantities as the Representatives reasonably request. The
Company will pay the expenses of printing and distributing to the Underwriters all such
documents.
(h) The Company will arrange for the qualification of the Securities for sale under the
laws of such jurisdictions as the Representatives reasonably designate and will continue
such qualifications in effect so long as required for the distribution;
provided
, that in
connection therewith the Company shall not be required to qualify to do business in any
jurisdiction or to file or consent or otherwise subject itself to service of process or
taxation in any jurisdiction where it is not already so subject.
-11-
(i) During the period of five years hereafter, the Company will furnish to the
Representatives and, upon request, to each of the other Underwriters, as soon as practicable
after the end of each fiscal year, a copy of its annual report to stockholders for such
year; and the Company will furnish to the Representatives (i) as soon as available, a copy
of each report and any definitive proxy statement of the Company filed with the Commission
under the Exchange Act or mailed to stockholders, and (ii) from time to time, such other
information concerning the Company as the Representatives may reasonably request.
(j) Whether or not the transactions contemplated in this Agreement are consummated or
this Agreement is terminated, the Company will pay or cause to be paid all expenses incident
to the performance of its obligations under this Agreement, including: (i) the fees,
disbursements and expenses of the Companys counsel and the Companys accountants in
connection with the registration and delivery of the Securities under the Securities Act and
all other fees or expenses in connection with the preparation and filing of the Indenture,
the Registration Statement, any preliminary prospectus, the Prospectus, any Issuer Free
Writing Prospectus and amendments and supplements to any of the foregoing, including all
printing costs associated therewith, and the mailing and delivering of copies thereof to the
Underwriters and dealers, in the quantities hereinabove specified, (ii) all costs and
expenses related to the transfer and delivery of the Securities to the Underwriters,
including any transfer or other taxes payable thereon, (iii) the cost of printing
certificates representing the Securities, (iv) any fees charged by securities rating
services for rating the Securities, (v) the fees and expenses of the Trustee and any agent
of the Trustee and the fees and disbursements of counsel for the Trustee in connection with
the Indenture and the Securities, (vi) travel and lodging expenses of officers and employees
of the Company for any road show undertaken in connection with the marketing of the
offering of the Securities, and one-half of the cost of any aircraft chartered in connection
with the road show, and (vii) all other costs and expenses incident to the performance of
the obligations of the Company hereunder for which provision is not otherwise made in this
Section. It is understood, however, that except as provided in this Section, Section 7
entitled Indemnity and Contribution, and the last paragraph of Section 9 below, the
Underwriters will pay all of their costs and expenses, including fees and disbursements of
their counsel, transfer taxes payable on resale of any of the Securities by them and any
advertising expenses connected with any offers they may make.
6.
Conditions to the Underwriters Obligations
. The obligations of the Company to sell the
Securities to the Underwriters and the several obligations of the Underwriters to purchase and pay
for the Securities on the Closing Date are subject to the following conditions:
(a) The Prospectus shall have been filed with the Commission in accordance with the
Rules and Regulations and Section 5(a) of this Agreement. The final term sheet described in
Section 5(d) and identified in Section 2.a of Schedule II shall have been filed within the
period required by Rule 433(d)(5)(ii) of the Rules and Regulations following the date such
final terms have been established for all classes of the offering of the Securities. No
stop order suspending the effectiveness of the Registration Statement or of
-12-
any part thereof shall have been issued and no proceedings for that purpose shall have
been instituted or, to the knowledge of the Company or any Underwriter, shall be
contemplated by the Commission.
(b) Subsequent to the execution and delivery of this Agreement and prior to the Closing
Date:
(i) there shall not have occurred any downgrading, nor shall any notice have
been given of any intended or potential downgrading or of any review for a possible
change that does not indicate the direction of the possible change, in the rating
accorded any of the Companys securities by Moodys Investors Service, Inc. or
Standard & Poors Rating Services, a Standard & Poors Financial Services LLC
business; and
(ii) there shall not have occurred any change, or any development involving a
prospective change, in the condition, financial or otherwise, or in the earnings,
business or operations of the Company and its subsidiaries, taken as a whole, from
that set forth in the General Disclosure Package and the Prospectus (exclusive of
any amendments or supplements thereto subsequent to the date of this Agreement)
that, in your judgment, is material and adverse and that makes it, in your judgment,
impracticable to market the Securities on the terms and in the manner contemplated
in the General Disclosure Package and the Prospectus.
(c) The Underwriters shall have received on the Closing Date an opinion of Willkie Farr
& Gallagher LLP, outside counsel for the Company, dated the Closing Date, to the effect
that:
(i) The Company is an existing corporation in good standing under the laws of
the State of Delaware;
(ii) The Company has corporate power and authority to own, lease and operate
its properties and to conduct its business as described in the Registration
Statement, General Disclosure Package and the Prospectus;
(iii) The Indenture has been duly qualified under the Trust Indenture Act, has
been duly authorized, executed and delivered by the Company and is a valid and
binding agreement of the Company, enforceable in accordance with its terms except as
(A) the enforceability thereof may be limited by bankruptcy, insolvency or similar
laws affecting creditors rights generally and (B) rights of acceleration and the
availability of equitable remedies may be limited by equitable principles of general
applicability;
(iv) The Securities have been duly authorized by all necessary corporate
action, have been executed, authenticated, issued and delivered and are entitled to
the benefits of the Indenture and are valid and binding obligations of the Company,
enforceable in accordance with their terms except as (A) the enforceability thereof
may be limited by bankruptcy, insolvency or similar laws affecting creditors rights
generally and (B) rights of acceleration and the
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availability of equitable remedies may be limited by equitable principles of
general applicability; and the Securities and the Indenture will conform to the
information in the General Disclosure Package and will conform in all material
respects to the descriptions thereof in the Prospectus;
(v) No consent, approval, authorization or order of, or filing with, any
governmental agency or body or any court is required for the consummation of the
transactions contemplated by this Agreement in connection with the issuance or sale
of the Securities by the Company, except such as have been obtained and made under
the Securities Act and such as may be required under state securities and insurance
laws, and the execution and delivery of this Agreement and the consummation of the
transactions herein contemplated will not conflict with or constitute a breach of,
or default under, the certificate of incorporation or by-laws of the Company;
(vi) The Registration Statement has become effective under the Securities Act,
the Prospectus was filed with the Commission pursuant to the subparagraph of Rule
424(b) specified in such opinion on the date specified therein, and, to the best of
the knowledge of such counsel, no stop order suspending the effectiveness of the
Registration Statement or any part thereof has been issued and no proceedings for
that purpose have been instituted or are pending or contemplated under the
Securities Act, and the Registration Statement and the Prospectus (but not including
the Form T-1 heretofore referred to or any document incorporated by reference in the
Registration Statement or the Prospectus), as of the date of this Agreement, and any
amendment or supplement thereto, and as of its date, complied as to form in all
material respects with the requirements of the Securities Act and the Rules and
Regulations; it being understood that such counsel need express no opinion as to the
financial statements or other financial data contained in the Registration Statement
or the Prospectus;
(vii) This Agreement has been duly authorized, executed and delivered by the
Company;
(viii) The information in the Prospectus and the General Disclosure Package
under the captions Description of the Debt Securities, Description of Notes,
Plan of Distribution and Underwriters, to the extent that such information is
applicable to the Securities and constitutes matter of law or legal conclusions or
descriptions of documents referred to therein, has been reviewed by such counsel and
is correct in all material respects; and
(ix) The Company is not and, after giving effect to the offering and sale of
the Securities and the application of the proceeds thereof as described in the
General Disclosure Package and the Prospectus, will not be an investment company
as defined in the Investment Company Act.
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The opinion of Willkie Farr & Gallagher LLP described in this Section 6(c) above shall
be rendered to the Underwriters at the request of the Company and shall so state therein.
In rendering such opinions, such counsel may state that (i) its opinion is limited to
matters governed by the Federal laws of the United States of America, the laws of the State
of New York and the corporate law of the State of Delaware and (ii) it has relied, as to
matters of fact to the extent it deems proper, on certificates of responsible officers of
the Company or public officials. In addition to the matters set forth above, such counsel
shall state that it has no reason to believe that (x) the Registration Statement, as of its
effective date relating to the Securities or as of the Closing Date, or any amendment
thereto, as of its effective time or as of the Closing Date, contained any untrue statement
of a material fact or omitted to state any material fact required to be stated therein or
necessary to make the statements therein not misleading or (y) the Prospectus, as of its
date or as of such Closing Date, or any amendment or supplement thereto, as of its date or
as of the Closing Date, contained any untrue statement of a material fact or omitted to
state any material fact necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading or (z) the General Disclosure
Package, as of the Applicable Time, contained any untrue statement of a material fact or
omitted to state any material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading; it being understood
that such counsel need express no view as to (A) the financial statements or other financial
data contained in the Registration Statement or the Prospectus and (B) that part of the
Registration Statement that constitutes the Form T-1 heretofore referred to.
(d) The Underwriters shall have received on the Closing Date an opinion of Ira S.
Lederman, Senior Vice President, General Counsel and Secretary of the Company, dated the
Closing Date, to the effect that:
(i) The Company has an authorized capitalization as is set forth in the General
Disclosure Package and the Prospectus;
(ii) The Company is duly qualified to do business as a foreign corporation in
good standing in all other jurisdictions in which its ownership or lease of property
or the conduct of its business requires such qualification, except where the failure
to be so qualified would not individually or in the aggregate have a Material
Adverse Effect;
(iii) Each Significant Subsidiary of the Company has been duly incorporated and
is validly existing as a corporation in good standing under the laws of its
jurisdiction of incorporation, has the corporate power and authority to own, lease
and operate its properties and to conduct the business described in the Registration
Statement, General Disclosure Package and the Prospectus and, to the extent
applicable, is duly qualified as a foreign corporation to transact business and is
in good standing as such in each jurisdiction in which it owns or leases substantial
properties or in which the conduct of its business requires such
-15-
qualification (except in such jurisdictions where the failure to be so
qualified would not individually or in the aggregate have a Material Adverse Effect)
(such counsel may note in his opinion that insurance laws of certain of such
jurisdictions where the Significant Subsidiaries hold an insurance license do not
require such due qualification as a foreign corporation); except as set forth in the
Registration Statement, General Disclosure Package and the Prospectus, all of the
issued and outstanding shares of capital stock of each Significant Subsidiary have
been duly authorized and validly issued and are owned directly or indirectly by the
Company, free and clear of any pledges, liens, encumbrances, claims or equities; and
all such shares are fully paid and nonassessable;
(iv) There are no contracts, agreements or understandings known to such counsel
between the Company and any person granting such person the right to require the
Company to file a registration statement under the Securities Act with respect to
any securities of the Company owned or to be owned by such person or to require the
Company to include such securities in the securities registered pursuant to the
Registration Statement or in any securities being registered pursuant to any other
registration statement filed by the Company under the Securities Act;
(v) To the best of such counsels knowledge, there are no licenses, franchises,
contracts, indentures, mortgages, loan agreements, notes, leases or other
instruments required to be described in the Registration Statement or to be filed as
an exhibit thereto other than those described therein or filed or incorporated by
reference as exhibits thereto;
(vi) The execution and delivery of, and the performance by the Company of its
obligations under, this Agreement, the Indenture and the Securities will not result
in a breach or violation of any of the terms and provisions of, or constitute a
default under, any statute, any rule, regulation or order of any governmental agency
or body or any court having jurisdiction over the Company or any Significant
Subsidiary of the Company or the charter or by-laws of any such subsidiary, or, to
the best of such counsels knowledge, any of their material properties, or any
material agreement, contract, indenture, mortgage, loan agreement, note, lease or
other instrument to which the Company or any such subsidiary is a party or by which
the Company or any such subsidiary is bound or to which any of the properties of the
Company or any such subsidiary is subject;
(vii) The Company has made all required filings under applicable insurance
holding company statutes, and has received approvals of acquisition of control
and/or affiliate transactions, in each jurisdiction in which such filings or
approvals are required, except where the failure to have made such filings or
receive such approvals in any such jurisdiction would not reasonably be expected to
have individually or in the aggregate a Material Adverse Effect; each of the
Insurance Subsidiaries is duly organized and licensed as an insurance or reinsurance
company in its respective jurisdiction of incorporation, and each such
-16-
Insurance Subsidiary owns the Insurance Licenses in each other jurisdiction in
which such licensing or authorization is required, except where the failure to be so
licensed or authorized in any such jurisdiction would not reasonably be expected to
have individually or in the aggregate a Material Adverse Effect; there is no pending
or, to the best of such counsels knowledge, threatened action, suit, proceeding or
investigation that would be reasonably likely to lead to the revocation, termination
or suspension of any such Insurance Licenses, the revocation, termination or
suspension of which would reasonably be expected to have individually or in the
aggregate a Material Adverse Effect; and except as disclosed in the General
Disclosure Package and the Prospectus, no insurance regulatory agency or body has
issued any order or decree impairing, restricting or prohibiting the payment of
dividends of any Company subsidiary to its respective parent which would reasonably
be expected to have individually or in the aggregate a Material Adverse Effect;
(viii) Except as would not individually or in the aggregate have a Material
Adverse Effect and except as described in the General Disclosure Package and the
Prospectus, (i) to the best of such counsels knowledge, there are no legal or
governmental proceedings pending or threatened which are required to be disclosed in
the Registration Statement, other than those disclosed therein, and (ii) there are
no pending legal or governmental proceedings, to the best of such counsels
knowledge, to which the Company or any subsidiary is a party or of which any of
their property is the subject which are not described in the Registration Statement
but are required to be so described in the Registration Statement, including
ordinary routine litigation incidental to the business;
(ix) The documents incorporated by reference in the Prospectus pursuant to Item
12 of Form S-3 under the Securities Act (other than the financial statements,
supporting schedules and other financial information included or incorporated by
reference therein, as to which no opinion need to be rendered), at the time they
were filed with the Commission or delivered to the security holders, as the case may
be, complied as to form in all material respects with the requirements of the
Exchange Act and the rules and regulations thereunder; and
(x) The descriptions in the Registration Statement, Prospectus and General
Disclosure Package of legal and governmental proceedings and contracts and other
documents are accurate in all material respects and fairly present the information
required to be shown; and, to the best of such counsels knowledge, no stop order
suspending the effectiveness of the Registration Statement or any part thereof has
been issued and no proceedings for that purpose have been instituted or are pending
or contemplated under the Securities Act.
In rendering such opinions, such counsel may state that (i) its opinion is limited to
matters governed by the Federal laws of the United States of America, the laws of the State
of New York and the corporate law of the State of Delaware and (ii) it has relied, as to
matters of fact to the extent it deems proper, on certificates of responsible officers of
the Company or public officials. In addition to the matters set forth above, such counsel
-17-
shall state that it has no reason to believe that (x) the Registration Statement, as of
its effective date relating to the Securities or as of the Closing Date, or any amendment
thereto, as of its effective time or as of the Closing Date, contained any untrue statement
of a material fact or omitted to state any material fact required to be stated therein or
necessary to make the statements therein not misleading or (y) the Prospectus, as of its
date or as of such Closing Date, or any amendment or supplement thereto, as of its date or
as of the Closing Date, contained any untrue statement of a material fact or omitted to
state any material fact necessary in order to make the statements therein, in the light of
the circumstances under which they were made, not misleading or (z) the General Disclosure
Package, as of the Applicable Time, contained any untrue statement of a material fact or
omitted to state any material fact necessary in order to make the statements therein, in the
light of the circumstances under which they were made, not misleading; it being understood
that such counsel need express no view as to (A) the financial statements or other financial
data contained in the Registration Statement or the Prospectus and (B) that part of the
Registration Statement that constitutes the Form T-1 heretofore referred to.
(e) The Underwriters shall have received on the Closing Date an opinion of Dewey &
LeBoeuf LLP, counsel for the Underwriters, dated the Closing Date, with respect to the
existence and good standing of the Company, the execution and delivery of this Agreement,
the qualification, execution, delivery and enforceability of the Indenture, the
authorization, validity and enforceability of the Securities, the Registration Statement,
the Prospectus, the General Disclosure Package and other related matters as the
Representatives may require, and the Company shall have furnished to such counsel such
documents as they request for the purpose of enabling them to pass upon such matters.
(f) The Underwriters shall have received on the Closing Date a certificate, dated the
Closing Date, of the President or any Vice President and a principal financial or accounting
officer of the Company in which such officers, to the best of their knowledge and after
reasonable investigation, shall state that the representations and warranties of the Company
in this Agreement are true and correct, that the Company has complied with all agreements
and satisfied all conditions on its part to be performed or satisfied hereunder at or prior
to the Closing Date, that no stop order suspending the effectiveness of the Registration
Statement or of any part thereof has been issued and no proceedings for that purpose have
been instituted or are contemplated by the Commission and that, subsequent to the date of
the most recent financial statements in the General Disclosure Package and the Prospectus,
(i) there has not occurred any downgrading, nor has any notice been given of any intended or
potential downgrading or any review for a possible change that does not indicate the
direction of the possible change, in the rating accorded any of the Companys securities by
Moodys Investors Service, Inc. or Standard & Poors Ratings Group, and (ii) there has been
no material adverse change, nor any development or event involving a prospective material
adverse change, in the condition (financial or other), business, properties or results of
operations of the Company and its subsidiaries taken as a whole except as set forth in or
contemplated by the Prospectus or as described in such certificate.
-18-
(g) The Underwriters shall have received on the date of this Agreement a letter in form
and substance agreed to by Dewey & LeBoeuf LLP, counsel for the Underwriters, from KPMG LLP,
independent public accountants, containing statements and information of the type ordinarily
included in accountants comfort letters to underwriters with respect to the financial
statements and certain financial information contained in the Prospectus and General
Disclosure Package, which letter shall use a cut-off date not earlier than the date hereof
(the
Comfort Letter
). The Underwriters shall also have received on the Closing Date a
bring down comfort letter from KPMG LLP in the form of Exhibit A hereto.
7.
Indemnity and Contribution
. (a) The Company agrees to indemnify and hold harmless each
Underwriter, each person, if any, who controls any Underwriter within the meaning of either Section
15 of the Securities Act or Section 20 of the Exchange Act and each affiliate of any Underwriter
within the meaning of Rule 405 under the Securities Act from and against any and all losses,
claims, damages and liabilities (including, without limitation, any legal or other expenses
reasonably incurred in connection with defending or investigating any such action or claim) caused
by any untrue statement or alleged untrue statement of a material fact contained in the
Registration Statement or any amendment thereof, any preliminary prospectus or any Statutory
Prospectus, the Prospectus or any Issuer Free Writing Prospectus (as amended or supplemented if the
Company shall have furnished any amendments or supplements thereto), or caused by any omission or
alleged omission to state therein a material fact required to be stated therein or necessary to
make the statements therein not misleading, except insofar as such losses, claims, damages or
liabilities are caused by any such untrue statement or omission or alleged untrue statement or
omission based upon information relating to any Underwriter furnished to the Company in writing by
such Underwriter through you expressly for use therein, it being understood and agreed that the
only such information furnished by any Underwriter consists of the information described as such in
subsection (b) below.
(b) Each Underwriter agrees, severally and not jointly, to indemnify and hold harmless
the Company, its directors, its officers who sign the Registration Statement and each
person, if any, who controls the Company within the meaning of either Section 15 of the
Securities Act or Section 20 of the Exchange Act to the same extent as the foregoing
indemnity from the Company to such Underwriter, but only with reference to information
relating to such Underwriter furnished to the Company in writing by such Underwriter through
you expressly for use in the Registration Statement, any preliminary prospectus, any
Statutory Prospectus, the Prospectus or any Issuer Free Writing Prospectus or any amendments
or supplements thereto.
(c) In case any proceeding (including any governmental investigation) shall be
instituted involving any person in respect of which indemnity may be sought pursuant to
Section 7(a) or 7(b), such person (the
indemnified party
) shall promptly notify the person
against whom such indemnity may be sought (the
indemnifying party
) in writing and the
indemnifying party, upon request of the indemnified party, shall retain counsel reasonably
satisfactory to the indemnified party to represent the indemnified party and any others the
indemnifying party may designate in such proceeding and shall pay the fees and disbursements
of such counsel related to such proceeding. In any such proceeding, any indemnified party
shall have the right to retain its own counsel, but the
-19-
fees and expenses of such counsel shall be at the expense of such indemnified party
unless (i) the indemnifying party and the indemnified party shall have mutually agreed to
the retention of such counsel or (ii) the named parties to any such proceeding (including
any impleaded parties) include both the indemnifying party and the indemnified party and
representation of both parties by the same counsel would be inappropriate due to actual or
potential differing interests between them. It is understood that the indemnifying party
shall not, in respect of the legal expenses of any indemnified party in connection with any
proceeding or related proceedings in the same jurisdiction, be liable for the fees and
expenses of more than one separate firm (in addition to any local counsel) for all such
indemnified parties and that all such fees and expenses shall be reimbursed as they are
incurred. Such firm shall be designated in writing by the Representatives, in the case of
parties indemnified pursuant to Section 7(a), and by the Company, in the case of parties
indemnified pursuant to Section 7(b). The indemnifying party shall not be liable for any
settlement of any proceeding effected without its written consent, but if settled with such
consent or if there be a final judgment for the plaintiff, the indemnifying party agrees to
indemnify the indemnified party from and against any loss or liability by reason of such
settlement or judgment. Notwithstanding the foregoing sentence, if at any time an
indemnified party shall have requested an indemnifying party to reimburse the indemnified
party for fees and expenses of counsel as contemplated by the second and third sentences of
this paragraph, the indemnifying party agrees that it shall be liable for any settlement of
any proceeding effected without its written consent if (i) such settlement is entered into
more than 30 days after receipt by such indemnifying party of the aforesaid request and (ii)
such indemnifying party shall not have reimbursed the indemnified party in accordance with
such request prior to the date of such settlement. No indemnifying party shall, without the
prior written consent of the indemnified party, effect any settlement of any pending or
threatened proceeding in respect of which any indemnified party is or could have been a
party and indemnity could have been sought hereunder by such indemnified party, unless such
settlement (i) includes an unconditional release of such indemnified party from all
liability on claims that are the subject matter of such proceeding and (ii) does not include
a statement as to or in admission of fault, culpability or a failure to act, by or on behalf
of any indemnified party.
(d) To the extent the indemnification provided for in Section 7(a) or 7(b) is
unavailable to an indemnified party or insufficient in respect of any losses, claims,
damages or liabilities referred to therein, then each indemnifying party under such
paragraph, in lieu of indemnifying such indemnified party thereunder, shall contribute to
the amount paid or payable by such indemnified party as a result of such losses, claims,
damages or liabilities (i) in such proportion as is appropriate to reflect the relative
benefits received by the Company on the one hand and the Underwriters on the other hand from
the offering of the Securities or (ii) if the allocation provided by clause 7(d)(i) above is
not permitted by applicable law, in such proportion as is appropriate to reflect not only
the relative benefits referred to in clause 7(d)(i) above but also the relative fault of the
Company on the one hand and of the Underwriters on the other hand in connection with the
statements or omissions that resulted in such losses, claims, damages or liabilities, as
well as any other relevant equitable considerations. The relative benefits received by the
Company on the one hand and the Underwriters on the other hand in connection with the
offering of the Securities shall be deemed to be in the same
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respective proportions as the net proceeds from the offering of the Securities (before
deducting expenses) received by the Company and the total underwriting discounts and
commissions received by the Underwriters, in each case as set forth in the table on the
cover of the Prospectus, bear to the aggregate Public Offering Price of the Securities. The
relative fault of the Company on the one hand and the Underwriters on the other hand shall
be determined by reference to, among other things, whether the untrue or alleged untrue
statement of a material fact or the omission or alleged omission to state a material fact
relates to information supplied by the Company or by the Underwriters and the parties
relative intent, knowledge, access to information and opportunity to correct or prevent such
statement or omission. The Underwriters respective obligations to contribute pursuant to
this Section 7 are several in proportion to the respective principal amount of Securities
they have purchased hereunder, and not joint.
(e) The Company and the Underwriters agree that it would not be just or equitable if
contribution pursuant to this Section 7 were determined by
pro rata
allocation (even if the
Underwriters were treated as one entity for such purpose) or by any other method of
allocation that does not take account of the equitable considerations referred to in Section
7(d). The amount paid or payable by an indemnified party as a result of the losses, claims,
damages and liabilities referred to in the immediately preceding paragraph shall be deemed
to include, subject to the limitations set forth above, any legal or other expenses
reasonably incurred by such indemnified party in connection with investigating or defending
any such action or claim. Notwithstanding the provisions of this Section 7, no Underwriter
shall be required to contribute any amount in excess of the amount by which the total price
at which the Securities underwritten by it and distributed to the public were offered to the
public exceeds the amount of any damages that such Underwriter has otherwise been required
to pay by reason of such untrue or alleged untrue statement or omission or alleged omission.
No person guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the Securities Act) shall be entitled to contribution from any person who was not guilty of
such fraudulent misrepresentation. The remedies provided for in this Section 7 are not
exclusive and shall not limit any rights or remedies which may otherwise be available to any
indemnified party at law or in equity.
(f) The indemnity and contribution provisions contained in this Section 7 and the
representations, warranties and other statements of the Company contained in this Agreement
shall remain operative and in full force and effect regardless of (i) any termination of
this Agreement, (ii) any investigation made by or on behalf of any Underwriter or any person
controlling any Underwriter or by or on behalf of the Company, its officers or directors or
any person controlling the Company and (iii) acceptance of and payment for any of the
Securities.
8.
Termination
. This Agreement shall be subject to termination by notice given by you to the
Company, if: (a) after the execution and delivery of this Agreement and prior to the Closing Date
(i) trading generally shall have been suspended or materially limited on or by, as the case may be,
any of the New York Stock Exchange, the American Stock Exchange or the NASDAQ Stock Market,
(ii) trading of any securities of the Company shall have been suspended on any exchange or in any
over-the-counter market, (iii) a material disruption in
-21-
securities settlement, payment or clearance services in the United States shall have occurred,
(iv) any moratorium on commercial banking activities in New York shall have been declared by either
Federal or New York State authorities, or (v) there shall have occurred any outbreak or escalation
of hostilities or, any change in financial markets or any calamity or crisis that, in your
judgment, is material and adverse; and (b) in the case of any of the events specified in clauses
8(a)(i) through 8(a)(v), such event, singly or together with any other such event, makes it, in
your judgment, impracticable or inadvisable to proceed with the offer, sale or delivery of the
Securities on the terms and in the manner contemplated in the General Disclosure Package and the
Prospectus.
9.
Effectiveness; Defaulting Underwriters
. This Agreement shall become effective upon the
execution and delivery hereof by the parties hereto.
If, on the Closing Date, any one or more of the Underwriters shall fail or refuse to purchase
Securities that it has or they have agreed to purchase hereunder on such date, and the aggregate
principal amount of Securities which such defaulting Underwriter or Underwriters agreed but failed
or refused to purchase is not more than one-tenth of the aggregate principal amount of the
Securities to be purchased on such date, the other Underwriters shall be obligated severally in the
proportions that the principal amount of Securities set forth opposite their respective names in
Schedule I bears to the aggregate principal amount of Securities set forth opposite the names of
all such non-defaulting Underwriters, or in such other proportions as you may specify, to purchase
the Securities which such defaulting Underwriter or Underwriters agreed but failed or refused to
purchase on such date;
provided
, that in no event shall the principal amount of Securities that any
Underwriter has agreed to purchase pursuant to this Agreement be increased pursuant to this
Section 9 by an amount in excess of one-ninth of such principal amount of Securities without the
written consent of such Underwriter. If, on the Closing Date, any Underwriter or Underwriters
shall fail or refuse to purchase Securities and the aggregate principal amount of Securities with
respect to which such default occurs is more than one-tenth of the aggregate principal amount of
Securities to be purchased, and arrangements satisfactory to you and the Company for the purchase
of such Securities are not made within 36 hours after such default, this Agreement shall terminate
without liability on the part of any non-defaulting Underwriter or the Company. In any such case
either you or the Company shall have the right to postpone the Closing Date, but in no event for
longer than seven days, in order that the required changes, if any, in the Registration Statement
and in the General Disclosure Package and the Prospectus or in any other documents or arrangements
may be effected. Any action taken under this paragraph shall not relieve any defaulting
Underwriter from liability in respect of any default of such Underwriter under this Agreement.
If this Agreement shall be terminated by the Underwriters, or any of them, because of any
failure or refusal on the part of the Company to comply with the terms or to fulfill any of the
conditions of this Agreement, or if for any reason the Company shall be unable to perform its
obligations under this Agreement, the Company will reimburse the Underwriters or such Underwriters
as have so terminated this Agreement with respect to themselves, severally, for all out-of-pocket
expenses (including the fees and disbursements of their counsel) reasonably incurred by such
Underwriters in connection with this Agreement or the offering contemplated hereunder.
-22-
10.
Notices
. All communications hereunder will be in writing and, if sent to the
Underwriters, will be mailed, delivered or telegraphed and confirmed to the Representatives, c/o
Banc of America Securities LLC, Bank of America Tower, One Bryant Park, New York, New York 10036,
(Facsimile: (704) 264-2522) Attention: High Grade Debt Capital Markets Transaction
Management/Legal, or, if sent to the Company, will be mailed, delivered or telegraphed and
confirmed to it at address and numbers of the Company set forth in the Registration Statement,
Attention: Ira S. Lederman, Senior Vice President, General Counsel and Secretary;
provided
,
however
, that any notice to an Underwriter pursuant to Section 7 will be mailed, delivered or
telegraphed and confirmed to such Underwriter.
11.
Counterparts
. This Agreement may be signed in two or more counterparts, each of which
shall be an original, with the same effect as if the signatures thereto and hereto were upon the
same instrument.
12.
Applicable Law
. This Agreement shall be governed by and construed in accordance with the
internal laws of the State of New York.
13.
Headings
. The headings of the sections of this Agreement have been inserted for
convenience of reference only and shall not be deemed a part of this Agreement.
14.
Absence of Fiduciary Relationship
. The Company acknowledges and agrees that:
(a) The Representatives have been retained solely to act as underwriters in connection
with the sale of the Securities and that no fiduciary, advisory or agency relationship
between the Company and the Representatives has been created in respect of any of the
transactions contemplated by this Agreement or the Prospectus, irrespective of whether the
Representatives have advised or are advising the Company on other matters;
(b) The price of the Securities set forth in this Agreement was established by the
Company following discussions and arms-length negotiations with the Representatives and the
Company is capable of evaluating and understanding and understands and accepts the terms,
risks and conditions of the transactions contemplated by this Agreement;
(c) The Company has been advised that the Representatives and their affiliates are
engaged in a broad range of transactions which may involve interests that differ from those
of the Company and that the Representatives have no obligation to disclose such interests
and transactions to the Company by virtue of any fiduciary, advisory or agency relationship;
and
(d) The Company waives, to the fullest extent permitted by law, any claims it may have
against the Representatives for breach of fiduciary duty or alleged breach of fiduciary duty
and agrees that the Representatives shall have no liability (whether direct or indirect) to
the Company in respect of such a fiduciary duty claim or to any person asserting a fiduciary
duty or claim on behalf of or in right if the Company, including stockholders, employees or
creditors of the Company.
-23-
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Very truly yours,
W. R. BERKLEY CORPORATION
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By:
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/s/ Eugene G. Ballard
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Name:
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Eugene G. Ballard
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Title:
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Senior Vice President
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Accepted as of the date hereof
BANC OF AMERICA SECURITIES LLC
Acting severally on behalf
of themselves and the
several Underwriters named
in Schedule I hereto
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By:
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BANC OF AMERICA SECURITIES LLC
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By:
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/s/ Joseph A. Crowley
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Name:
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Joseph A. Crowley
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Title:
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Director
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[Signature page to Underwriting Agreement]
SCHEDULE I
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Principal Amount of
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Securities
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Underwriter
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To Be Purchased
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Banc of America Securities LLC
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$
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120,000,000
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J.P. Morgan Securities LLC
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60,000,000
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Morgan Stanley & Co. Incorporated
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60,000,000
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Wells Fargo Securities, LLC
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60,000,000
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Total
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$
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300,000,000
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SCHEDULE II
1.
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Statutory Prospectus Included in the General Disclosure Package
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a.
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Prospectus, dated November 26, 2008, included in the Registration
Statement, as supplemented by the Preliminary Prospectus Supplement, dated
September 13, 2010.
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2.
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General Use Issuer Free Writing Prospectuses Included in the General Disclosure Package
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a.
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Final term sheet dated September 13, 2010, a copy of which is attached
hereto.
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3.
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Other Information Included in the General Disclosure Package
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W. R. Berkley Corporation
$300,000,000
5.375% SENIOR NOTES DUE 2020
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Issuer:
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W. R. Berkley Corporation
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Securities:
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5.375% Senior Notes due 2020
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Security Type:
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Senior Unsecured Fixed Rate Notes
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Anticipated Ratings*:
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Baa2/BBB+/BBB+ (Stable/Stable/Stable)
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Minimum Denominations:
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$1,000 x $1,000
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Trade Date:
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September 13, 2010
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Settlement Date:
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September 16, 2010
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Maturity Date:
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September 15, 2020
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Fees:
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0.650%
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Principal Amount:
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$300,000,000
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Price to Public:
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99.710% of principal amount
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Spread to Treasury Benchmark:
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265 basis points
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Treasury Benchmark:
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2.625% due August 15, 2020
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Treasury Benchmark Yield:
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2.763%
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Coupon:
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5.375%
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Yield to Maturity:
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5.413%
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Interest Payment Dates:
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Semi-annually on the 15
th
of each March and September,
commencing on March 15
th
, 2011
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Optional Redemption:
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Make-whole redemption at any time at a discount rate of US Treasury + 50 bps
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CUSIP; ISIN:
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084423AR3; US084423AR36
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Active Bookrunner:
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Banc of America Securities LLC (Billing & Delivering)
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Passive Bookrunners:
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J.P. Morgan Securities LLC, Wells Fargo Securities, LLC
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Co-Manager:
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Morgan Stanley & Co. Incorporated
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*Note: A securities rating is not a recommendation to buy, sell or hold securities and may be
subject to revision or withdrawal at any time
The issuer has filed a registration statement, including a prospectus, with the SEC for the offering to which this communication relates. Before you invest, you should read the prospectus in
that registration statement and other documents the issuer has filed with the SEC for more complete
information about the issuer and this offering. You may get these documents for free by visiting
EDGAR on the SEC Web site at www.sec.gov. Alternatively, the Bookrunner in the offering will
arrange to send you the prospectus if you request it by contacting Banc of America Securities LLC
toll-free at 1-800-294-1322.
Exhibit 4.2
Execution Version
W. R. BERKLEY CORPORATION
TO
THE BANK OF NEW YORK MELLON, as Trustee
SEVENTH SUPPLEMENTAL INDENTURE TO
INDENTURE DATED FEBRUARY 14, 2003
(SENIOR DEBT SECURITIES)
Dated as of September 16, 2010
5.375% Senior Notes due 2020
TABLE OF CONTENTS
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Page
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ARTICLE I
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Relation to Indenture; Definitions
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Section 1.1. RELATION TO INDENTURE
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1
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Section 1.2. DEFINITIONS
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1
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ARTICLE II
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The Series of Securities
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Section 2.1. TITLE OF THE SECURITIES
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2
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Section 2.2. LIMITATION ON AGGREGATE PRINCIPAL AMOUNT
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2
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Section 2.3. PRINCIPAL PAYMENT DATE
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2
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Section 2.4. INTEREST AND INTEREST RATES
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2
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Section 2.5. PLACE OF PAYMENT
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3
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Section 2.6. REDEMPTION
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3
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Section 2.7. DENOMINATION
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5
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Section 2.8. CURRENCY
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5
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Section 2.9. FORM OF NOTES
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5
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Section 2.10. REGISTRAR AND PAYING AGENT FOR THE NOTES
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5
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Section 2.11. SINKING FUND OBLIGATIONS
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5
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Section 2.12. DEFEASANCE AND COVENANT DEFEASANCE
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5
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Section 2.13. PAYMENT OF TAXES
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5
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Section 2.14. LIMITATION ON LIENS ON STOCK OF PRINCIPAL SUBSIDIARIES
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5
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Section 2.15. LIMITATIONS ON ISSUE OR DISPOSITION OF COMMON STOCK OF PRINCIPAL SUBSIDIARIES
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6
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Section 2.16. IMMEDIATELY AVAILABLE FUNDS
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6
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ARTICLE III
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Miscellaneous Provisions
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Section 3.1. TRUSTEE NOT RESPONSIBLE FOR RECITALS
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7
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Section 3.2. PAYMENT OF EXPENSES UPON RESIGNATION OR REMOVAL
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7
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Section 3.3. ADOPTION, RATIFICATION AND CONFIRMATION
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7
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Section 3.4. COUNTERPARTS
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7
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Section 3.5. GOVERNING LAW
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7
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W. R.
BERKLEY CORPORATION
SEVENTH SUPPLEMENTAL INDENTURE TO
INDENTURE DATED FEBRUARY 14, 2003
(SENIOR DEBT SECURITIES)
$300,000,000
5.375% Senior Notes due 2020
SEVENTH SUPPLEMENTAL INDENTURE, dated as of September 16, 2010, between W. R. BERKLEY
CORPORATION, a Delaware corporation (the Company), and THE BANK OF NEW YORK MELLON, a banking
corporation organized under the laws of the State of New York, as Trustee (the Trustee).
RECITALS
The Company has heretofore executed and delivered to the Trustee an indenture for senior debt
securities, dated as of February 14, 2003 (the Indenture), providing for the issuance from time
to time of series of the Companys Securities.
Section 3.1 of the Indenture provides for various matters with respect to any series of
Securities issued under the Indenture to be established in an indenture supplemental to the
Indenture.
Section 9.1(4) of the Indenture provides for the Company and the Trustee to enter into an
indenture supplemental to the Indenture to establish the form or terms of Securities of any series
as provided by Sections 2.1 and 3.1 of the Indenture.
NOW, THEREFORE, THIS SEVENTH SUPPLEMENTAL INDENTURE WITNESSETH:
For and in consideration of the premises and the issuance of the series of Securities provided
for herein, it is mutually agreed, for the equal and proportionate benefit of all Holders of the
Securities of such series, as follows:
ARTICLE I
RELATION TO INDENTURE; DEFINITIONS
Section 1.1. RELATION TO INDENTURE. This Seventh Supplemental Indenture constitutes an
integral part of the Indenture.
Section 1.2. DEFINITIONS. For all purposes of this Seventh Supplemental Indenture:
1
(a) Capitalized terms used herein without definition shall have the meanings specified in the
Indenture;
(b) All references herein to Articles and Sections, unless otherwise specified, refer to the
corresponding Articles and Sections of this Seventh Supplemental Indenture; and
(c) The terms herein, hereof, hereunder and other words of similar import refer to this
Seventh Supplemental Indenture.
(d) Fair Value, when used with respect to Common Stock, means the fair value thereof as
determined in good faith by the Board of Directors.
ARTICLE II
THE SERIES OF SECURITIES
Section 2.1. TITLE OF THE SECURITIES. There shall be a series of Securities designated the
5.375% Senior Notes due 2020 (the Notes).
Section 2.2. LIMITATION ON AGGREGATE PRINCIPAL AMOUNT. The aggregate principal amount of the
Notes shall initially be limited to $300,000,000. The Company may, without the consent of the
Holders of the Notes, issue additional Securities having the same interest rate, maturity date and
other terms as described in the related prospectus supplement and prospectus. Any additional
Securities, together with the Notes offered by the related prospectus supplement, will constitute a
single series of Securities under the Indenture. No additional Securities may be issued if an Event
of Default under the Indenture has occurred and is continuing with respect to the Securities.
Section 2.3. PRINCIPAL PAYMENT DATE. The principal amount of the Notes outstanding (together
with any accrued and unpaid interest) shall be payable in a single installment on September 15,
2020, which date shall be the Stated Maturity of the Notes Outstanding.
Section 2.4. INTEREST AND INTEREST RATES. The rate of interest on each Note shall be 5.375%
per annum, accruing from September 16, 2010, or from the most recent interest payment date (each
such date, an Interest Payment Date) to which interest has been paid or duly provided for,
payable semiannually in arrears on March 15 and September 15 of each year commencing March 15, 2011
until the principal thereof shall have become due and payable, and until the principal thereof is
paid or duly provided for or made available for payment. The amount of interest payable on any
Interest Payment Date shall be computed on the basis of a 360-day year of twelve 30-day months. The
amount of interest payable for any partial period shall be computed on the basis of the actual
number of days elapsed in a 360-day year of twelve 30-day months. In the event that any date on
which interest is payable on any Note is not a Business Day, then payment of interest payable on
such date will be made on the next succeeding day that is a Business Day (and without any interest
or other payment in respect of any such delay). The interest installment so payable in respect of
any Note, and punctually paid or duly provided for, on any Interest Payment Date will, as provided
in the Indenture, be paid to
2
the person in whose name such Note (or one or more Predecessor Securities) is registered at
the close of business on March 1 or September 1 prior to such Interest Payment Date. Any such
interest installment not punctually paid or duly provided for in respect of any Note shall
forthwith cease to be payable to the registered Holder on such Regular Record Date and may either
be paid to the Person in whose name such Note (or one or more Predecessor Securities) is registered
at the close of business on a Special Record Date to be fixed by the Company and the Trustee for
the payment of such Defaulted Interest, notice whereof shall be given to the Holders of the Notes
not less than 10 days prior to such Special Record Date, or be paid at any time in any other lawful
manner not inconsistent with the requirements of any securities exchange on which the Notes may be
listed, and upon such notice as may be required by such exchange, all as more fully provided in the
Indenture.
Section 2.5. PLACE OF PAYMENT. The Place of Payment where the Notes may be presented or
surrendered for payment, where the Notes may be surrendered for registration of transfer or
exchange and where notices and demand to or upon the Company in respect of the Notes and the
Indenture may be served shall be the Corporate Trust Office of the Trustee.
Section 2.6. REDEMPTION.
(a) The Company may redeem the Notes at its option, in whole or in part, at any time and from
time to time at a Redemption Price equal to the greater of (i) 100% of the principal amount of such
Securities to be redeemed or (ii) an amount, as determined by an Independent Investment Banker,
equal to the sum of the present values of the remaining scheduled payments of principal of and
interest on the securities to be redeemed (not including any portion of such payments of interest
accrued as of the Redemption Date) discounted to the Redemption Date on a semiannual basis
(assuming a 360-day year consisting of twelve 30-day months) at the Adjusted Treasury Rate, plus 50
basis points, plus, in either of the above cases, accrued and unpaid interest thereon to, but not
including, the Redemption Date.
(b) For the purposes of this Section 2.6,
Adjusted Treasury Rate means, with respect to any Redemption Date:
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the yield, under the heading which represents the average for the
immediately preceding week, appearing in the most recently published
statistical release designated H.15(519) published by the Board of Governors
of the Federal Reserve System (or any successor publication which is published
weekly by the Board of Governors of the Federal Reserve System and which
establishes yields on actively traded United States Treasury securities
adjusted to constant maturity) under the caption Treasury Constant
Maturities, for the maturity corresponding to the Comparable Treasury Issue.
If no maturity is within three months before or after the Remaining Life,
yields for the two published maturities most closely corresponding to the
Comparable Treasury Issue shall be determined and the Adjusted Treasury Rate
shall be interpolated or
|
3
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extrapolated from such yields on a straight line basis, rounding to the
nearest month; or
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if such release (or any successor release) is not published during the week
preceding the calculation date or does not contain such yields, the rate per
annum equal to the semi-annual equivalent yield to maturity of the Comparable
Treasury Issue, calculated using a price for the Comparable Treasury Issue
(expressed as a percentage of its principal amount) equal to the Comparable
Treasury Price for such Redemption Date.
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The Adjusted Treasury Rate shall be calculated on the third Business Day preceding the
Redemption Date.
Comparable Treasury Issue means the United States Treasury security selected by an
Independent Investment Banker as having a maturity comparable to the remaining term of the notes to
be redeemed that would be utilized, at the time of selection and in accordance with customary
financial practice, in pricing new issues of corporate debt securities of comparable maturity to
the remaining term of such securities (Remaining Life).
Comparable Treasury Price means (i) the average of three Reference Treasury Dealer
Quotations for such Redemption Date, after excluding the highest and lowest Reference Treasury
Dealer Quotations, or (ii) if the Independent Investment Banker obtains fewer than three such
Reference Treasury Dealer Quotations, the average of all such quotations.
Independent Investment Banker means one of the Reference Treasury Dealers appointed by us.
Reference Treasury Dealer means:
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each of Banc of America Securities LLC, J.P. Morgan Securities LLC, Morgan
Stanley & Co. Incorporated and a Primary Treasury Dealer selected by Wells
Fargo Securities, LLC, and their respective successors;
provided
that, if any
of the foregoing ceases to be a primary U.S. Government securities dealer in
the United States (a Primary Treasury Dealer), the Company shall substitute
therefor another Primary Treasury Dealer; and
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any other Primary Treasury Dealer selected by the Company.
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Reference Treasury Dealer Quotations means, with respect to each Reference Treasury Dealer
and any Redemption Date, the average, as determined by the Independent Investment Banker, of the
bid and asked prices for the Comparable Treasury Issue (expressed in each case as a percentage of
its principal amount) quoted in writing to the Independent Investment Banker at 5:00 p.m., New York
City Time, on the third Business Day preceding such Redemption Date.
4
The Company will mail a notice of redemption at least 30 days but not more than 60 days before
the Redemption Date to each holder of the notes to be redeemed. If less than all of the notes are
to be redeemed, the trustee will select, by such method as it will deem fair and appropriate,
including
pro rata
or by lot, the notes to be redeemed in whole or in part.
Unless the Company defaults in payment of the Redemption Price, on and after the Redemption
Date, interest will cease to accrue on the notes or portions thereof called for redemption.
Section 2.7. DENOMINATION. The Notes shall be issuable only in registered form without
coupons and in denominations of $1,000 and integral multiples thereof.
Section 2.8. CURRENCY. Principal and interest on the Notes shall be payable in such coin or
currency of the United States of America that at the time of payment is legal tender for payment of
public and private debts.
Section 2.9. FORM OF NOTES. The Notes shall be substantially in the form attached as EXHIBIT
A hereto.
Section 2.10. REGISTRAR AND PAYING AGENT FOR THE NOTES. The Trustee shall serve initially as
Registrar and Paying Agent for the Notes.
Section 2.11. SINKING FUND OBLIGATIONS. The Company has no obligation to redeem or purchase
any Notes pursuant to any sinking fund or analogous requirement or upon the happening of a
specified event or at the option of a Holder thereof.
Section 2.12. DEFEASANCE AND COVENANT DEFEASANCE. The Company has elected to have both
Section 4.2(2) of the Indenture (relating to defeasance) and Section 4.2(3) (relating to covenant
defeasance) applied to the Notes.
Section 2.13. PAYMENT OF TAXES. The Company will pay or discharge or cause to be paid or
discharged, before the same shall become delinquent, all taxes, assessments and governmental
charges levied or imposed upon the Company or any Subsidiary or upon the income, profits or
property of the Company or any Subsidiary, and lawful claims for labor, materials and supplies,
which, if unpaid, might by law become a lien upon the property of the Company or any Subsidiary;
provided
,
however
, that the Company shall not be required to pay or discharge or cause to be paid
or discharged any such tax, assessment or governmental charge whose amount, applicability or
validity is being contested in good faith by appropriate proceedings or where the failure to effect
such payment is not adverse in any material respect to the Holders of the Notes.
Section 2.14. LIMITATION ON LIENS ON STOCK OF PRINCIPAL SUBSIDIARIES. The Company will not,
and it will not permit any Subsidiary of the Company to, at any time directly or indirectly create,
assume, incur or permit to exist any Indebtedness secured by a pledge, lien or other encumbrance
(any pledge, lien or other encumbrance being hereinafter in this Section referred to as a lien)
on the voting securities of Principal Subsidiaries, or the voting securities of a Subsidiary that
owns, directly or indirectly, the voting
5
securities of any of the Principal Subsidiaries without making effective provision whereby the
Notes then Outstanding (and, if the Company so elects, any other Indebtedness of the Company that
is not subordinate to the Notes and with respect to which the governing instruments require, or
pursuant to which the Company is otherwise obligated or required, to provide such security) shall
be equally and ratably secured with such secured Indebtedness so long as such other Indebtedness
shall be secured. For purposes of this Section 2.14 only, Indebtedness, in addition to those
items specified in Section 1.1 of the Indenture, shall include any obligation of, or any such
obligation guaranteed by, any Person for the payment of amounts due under a swap agreement or other
similar instrument or agreement or foreign currency hedge exchange or similar instrument or
agreement.
If the Company shall hereafter be required to secure the Notes equally and ratably with any
other Indebtedness pursuant to this Section, (i) the Company will promptly deliver to the Trustee
an Officers Certificate stating that the foregoing covenant has been complied with, and an Opinion
of Counsel stating that in the opinion of such counsel the foregoing covenant has been complied
with and that any instruments executed by the Company or any Subsidiary of the Company in the
performance of the foregoing covenant comply with the requirements of the foregoing covenant and
(ii) the Trustee is hereby authorized to enter into an indenture or agreement supplemental hereto
and to take such action, if any, as it may deem advisable to enable it to enforce the rights of the
holders of the Notes so secured.
Section 2.15. LIMITATIONS ON ISSUE OR DISPOSITION OF COMMON STOCK OF PRINCIPAL SUBSIDIARIES.
As long as any of the Notes remain outstanding, the Company will not, and will not permit any
Subsidiary to, issue, sell, assign, transfer or otherwise dispose of, directly or indirectly, any
of the Common Stock of any Principal Subsidiary (except to the Company or to one or more
Subsidiaries or for the purpose of qualifying directors);
provided
,
however
, that this covenant
shall not apply if (i) the issuance, sale, assignment, transfer or other disposition is required to
comply with the order of a court or regulatory authority of competent jurisdiction, other than an
order issued at the request of the Company or of one of its Subsidiaries; (ii) the entire Common
Stock of a Principal Subsidiary then owned by the Company or by its Subsidiaries is disposed of in
a single transaction or in a series of related transactions, for consideration consisting of cash
or other property which is at least equal to the Fair Value of such Common Stock; or (iii) after
giving effect to the issuance, sale, assignment, transfer or other disposition, the Company and its
Subsidiaries would own directly or indirectly at least 80% of the issued and outstanding Common
Stock of such Principal Subsidiary and such issuance, sale, assignment, transfer or other
disposition is made for consideration consisting of cash or other property which is at least equal
to the Fair Value of such Common Stock.
Section 2.16. IMMEDIATELY AVAILABLE FUNDS. All payments of principal and interest shall be
made in immediately available funds.
6
ARTICLE III
MISCELLANEOUS PROVISIONS
Section 3.1. TRUSTEE NOT RESPONSIBLE FOR RECITALS. The recitals herein contained are made by
the Company and not by the Trustee, and the Trustee assumes no responsibility for the correctness
thereof. The Trustee makes no representation as to the validity or sufficiency of this Seventh
Supplemental Indenture.
Section 3.2. PAYMENT OF EXPENSES UPON RESIGNATION OR REMOVAL. Upon termination of this
Seventh Supplemental Indenture or the Indenture or the removal or resignation of the Trustee,
unless otherwise stated, the Company shall pay to the Trustee all amounts accrued to the date of
such termination, removal or resignation.
Section 3.3. ADOPTION, RATIFICATION AND CONFIRMATION. The Indenture, as supplemented and
amended by this Seventh Supplemental Indenture, is in all respects hereby adopted, ratified and
confirmed.
Section 3.4. COUNTERPARTS. This Seventh Supplemental Indenture may be executed in any number
of counterparts, each of which shall be an original, but such counterparts shall together
constitute but one and the same instrument.
Section 3.5. GOVERNING LAW. THIS SEVENTH SUPPLEMENTAL INDENTURE AND EACH NOTE SHALL BE DEEMED
TO BE A CONTRACT MADE UNDER THE LAWS OF THE STATE OF NEW YORK AND SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICTS OF LAWS
PRINCIPLES THEREOF.
7
IN WITNESS WHEREOF, the parties hereto have caused this Seventh Supplemental Indenture to be
duly executed on the day and year first above written.
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W. R. BERKLEY CORPORATION
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By:
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/s/ Eugene G. Ballard
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Name:
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Eugene G. Ballard
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Title:
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Senior Vice President
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THE BANK OF NEW YORK
MELLON,
as Trustee
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By:
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/s/ Timothy W. Casey
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Name:
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Timothy W. Casey
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Title:
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Senior Associate
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8
EXHIBIT A
(FORM OF FACE OF NOTE)
This Note is a global Security within the meaning of the Indenture hereinafter referred to and
is registered in the name of a Depository or a nominee of a Depository. This Note is exchangeable
for Securities registered in the name of a person other than the Depository or its nominee only in
the limited circumstances described in the Indenture, and no transfer of this Note (other than a
transfer of this Note as a whole by the Depository to a nominee of the Depository or by a nominee
of the Depository to the Depository or another nominee of the Depository) may be registered except
in limited circumstances.
Unless this Note is presented by an authorized representative of The Depository Trust Company
(55 Water Street, New York, New York) to the issuer or its agent for registration of transfer,
exchange or payment, and any Note issued is registered in the name of Cede & Co. or such other name
as requested by an authorized representative of The Depository Trust Company and any payment hereon
is made to Cede & Co., ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY A PERSON
IS WRONGFUL since the registered owner hereof, Cede & Co., has an interest herein.
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Certificate No. 7
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$300,000,000
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Dated: September 16, 2010
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CUSIP No. 084423 AR3
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ISIN No. US084423 AR36
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W. R. BERKLEY CORPORATION
5.375% Senior Notes due 2020
W. R. BERKLEY CORPORATION, a Delaware corporation (the Company, which term includes any
successor corporation under the Indenture hereinafter referred to), for value received, hereby
promises to pay to CEDE & CO. or registered assigns, the principal sum of THREE HUNDRED MILLION
DOLLARS AND NO CENTS ($300,000,000) on September 15, 2020. The Company further promises to pay
interest on said principal sum outstanding from September 16, 2010, or from the most recent
interest payment date (each such date, an Interest Payment Date) to which interest has been paid
or duly provided for, semiannually (subject to deferral as set forth herein) in arrears on March 15
and September 15 of each year commencing March 15, 2011 at the rate of 5.375% per annum, until the
principal hereof shall have become due and payable and, until the principal hereof is paid or duly
provided for or made available for payment. The amount of interest payable on any Interest Payment
Date shall be computed on the basis of a 360-day year of twelve 30-day months. The amount of
interest payable for any partial period shall be computed on the basis of the number of actual days
elapsed in a 360-day year of twelve 30-day months. In the event that any date on which interest is
payable on this Note is not a Business Day, then payment of interest payable on such date will be
made on the next succeeding day that is a Business Day (and without any interest or other payment
in respect of any such delay). A Business Day, with respect to any Place of Payment or other location,
shall
A-1
mean any day other than a Saturday, Sunday or other day on which banking institutions in such
Place of Payment or other location are authorized or obligated by law, regulation or executive
order to close. The interest installment so payable, and punctually paid or duly provided for, on
any Interest Payment Date will, as provided in the Indenture, be paid to the Person in whose name
this Note (or one or more Predecessor Securities) is registered at the close of business on March 1
or September 1 prior to such Interest Payment Date. Any such interest installment not punctually
paid or duly provided for shall forthwith cease to be payable to the registered Holder on such
Regular Record Date and may either be paid to the Person in whose name this Note (or one or more
Predecessor Securities) is registered at the close of business on a Special Record Date to be fixed
by the Trustee for the payment of such Defaulted Interest, notice whereof shall be given to the
Holder of this Note not less than 10 days prior to such Special Record Date, or be paid at any time
in any other lawful manner not inconsistent with the requirements of any securities exchange on
which this Note may be listed, and upon such notice as may be required by such exchange, all as
more fully provided in the Indenture.
The principal of (and premium, if any) and the interest on this Note shall be payable at the
office or agency of the Company maintained for that purpose in the United States in such coin or
currency of the United States of America that at the time of payment is legal tender for payment of
public and private debts;
provided
,
however
, that payment of interest may be made at the option of
the Company by check mailed to the registered Holder at such address as shall appear in the
Security Register. Notwithstanding the foregoing, so long as the Holder of this Note is Cede & Co.,
the payment of the principal of (and premium, if any) and interest on this Note will be made at
such place and to such account as may be designated by Cede & Co. All payments of principal and
interest hereunder shall be made in immediately available funds.
Reference is hereby made to the further provisions of this Note set forth on the reverse
hereof, which further provisions shall for all purposes have the same effect as if set forth at
this place.
Unless the certificate of authentication hereon has been executed by the Trustee referred to
on the reverse hereof by manual signature, this Note shall not be entitled to any benefit under the
Indenture or be valid for any purpose.
A-2
IN WITNESS WHEREOF, the Company has caused this instrument to be executed.
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W. R. BERKLEY CORPORATION
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By:
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Name:
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Title:
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CERTIFICATE OF AUTHENTICATION
This is one of the Securities of the series designated herein referred to in the
within-mentioned Indenture.
Dated: September 16, 2010
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THE BANK OF NEW YORK MELLON,
as Trustee
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By:
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Authorized Signatory
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A-3
(FORM OF REVERSE OF NOTE)
This Note is one of a duly authorized issue of securities of the Company, designated as its
5.375% Senior Notes due 2020 (herein referred to as the Securities), issued under and pursuant to
an Indenture, dated as of February 14, 2003, between the Company and The Bank of New York Mellon,
as Trustee (herein called the Trustee, which term includes any successor trustee under the
Indenture), as supplemented by the Seventh Supplemental Indenture dated as of September 16, 2010,
between the Company and the Trustee (the Indenture as so supplemented, the Indenture), to which
Indenture and all indentures supplemental thereto reference is hereby made for a description of the
rights, limitations of rights, obligations, duties and immunities thereunder of the Trustee, the
Company and the Holders of the Securities, and of the terms upon which the Securities are, and are
to be, authenticated and delivered.
All terms used in this Note that are defined in the Indenture shall have the
meanings assigned to them in the Indenture.
The Company may redeem the Securities at the Companys option , in whole or in part,
at any time and from time to time at a Redemption Price equal to the greater of (i) 100% of
the principal amount of such Securities to be redeemed or (ii) an amount, as determined by
an Independent Investment Banker, the sum of the present values of the remaining scheduled
payments of principal of and interest thereon on the Securities to be redeemed (not
including any portion of such payments of interest accrued to the Redemption Date)
discounted to the Redemption Date on a semiannual basis assuming a 360-day year consisting
of twelve 30-day months) at the Adjusted Treasury Rate, plus 50 basis points, plus, in
either of the above cases, accrued and unpaid interest thereon to the Redemption Date.
Adjusted Treasury Rate means, with respect to any Redemption Date:
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the yield, under the heading which represents the average for the
immediately preceding week, appearing in the most recently published
statistical release designated H.15(519) published by the Board of Governors
of the Federal Reserve System (or any successor publication which is published
weekly by the Board of Governors of the Federal Reserve System and which
establishes yields on actively traded United States Treasury securities
adjusted to constant maturity) under the caption Treasury Constant
Maturities, for the maturity corresponding to the Comparable Treasury Issue.
If no maturity is within three months before or after the Remaining Life,
yields for the two published maturities most closely corresponding to the
Comparable Treasury Issue shall be determined and the Adjusted Treasury Rate
shall be interpolated or extrapolated from such yields on a straight line
basis, rounding to the nearest month; or
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if such release (or any successor release) is not published during the week
preceding the calculation date or does not contain such yields, the rate per
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A-4
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annum equal to the semiannual equivalent yield to maturity of the Comparable
Treasury Issue, calculated using a price for the Comparable Treasury Issue
(expressed as a percentage of its principal amount) equal to the Comparable
Treasury Price for such Redemption Date.
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The Adjusted Treasury Rate shall be calculated on the third Business Day preceding the
Redemption Date.
Comparable Treasury Issue means the United States Treasury security selected by an
Independent Investment Banker as having a maturity comparable to the remaining term of the
Securities to be redeemed that would be used, at the time of selection and in accordance with
customary financial practice, in pricing new issues of corporate debt securities of comparable
maturity to the remaining term of such Securities (Remaining Life).
Comparable Treasury Price means (i) the average of three Reference Treasury Dealer
Quotations for such Redemption Date, after excluding the highest and lowest Reference Treasury
Dealer Quotations, or (ii) if the Independent Investment Banker obtains fewer than three such
Reference Treasury Dealer Quotations, the average of all such quotations.
Independent Investment Banker means one of the Reference Treasury Dealers appointed by us.
Reference Treasury Dealer means:
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each of Banc of America Securities LLC, J.P. Morgan Securities LLC, Morgan
Stanley & Co. Incorporated and a Principal Treasury Dealer selected by Wells
Fargo Securities, LLC, and their respective successors; provided, however, that
if any of the foregoing shall cease to be a primary U.S. Government securities
dealer in the United States (a Primary Treasury Dealer), the Company shall
substitute therefor another Primary Treasury Dealer; and
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any other Primary Treasury Dealer selected by the Company.
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Reference Treasury Dealer Quotations means, with respect to each Reference Treasury Dealer
and any Redemption Date, the average, as determined by the Independent Investment Banker, of the
bid and asked prices for the Comparable Treasury Issue (expressed in each case as a percentage of
its principal amount) quoted in writing to the Independent Investment Banker at 5:00 p.m., New York
City Time, on the third Business Day preceding such Redemption Date.
The Company will mail a notice of redemption at least 30 days but not more than 60 days before
the Redemption Date to each holder of the Securities to be redeemed. If less than all of the
Securities are to be redeemed, the Trustee will select, by such method as it will deem fair and
appropriate, including
pro rata
or by lot, the Securities to be redeemed in whole or in part.
A-5
Unless the Company defaults in payment of the Redemption Price, on and after the Redemption
Date, interest will cease to accrue on the Securities or portions thereof called for redemption.
If an Event of Default with respect to Securities of this series shall occur and be
continuing, the principal of the Securities of this series may be declared due and payable in the
manner, with the effect and subject to the conditions provided in the Indenture.
The Indenture contains provisions for satisfaction, discharge and defeasance at any time of
the entire indebtedness of this Note upon compliance by the Company with certain conditions set
forth in the Indenture.
The Indenture permits, with certain exceptions as therein provided, the amendment thereof and
the modification of the rights and obligations of the Company and the rights of the Holders of the
Securities of each series to be affected under the Indenture at any time by the Company and the
Trustee with the consent of the Holders of a majority in principal amount of the Securities of each
series at the time Outstanding of each series to be affected. The Indenture also contains
provisions permitting Holders of specified percentages in principal amount of the Securities of
each series at the time Outstanding, on behalf of the Holders of all Securities of such series, to
waive compliance by the Company with certain provisions of the Indenture and certain past defaults
under the Indenture and their consequences. Any such consent or waiver by the Holder of this Note
shall be conclusive and binding upon such Holder and upon all future Holders of this Note and of
any Note issued upon the registration of transfer hereof or in exchange therefor or in lieu hereof,
whether or not notation of such consent or waiver is made upon this Note. No reference herein to
the Indenture and no provision of this Note or of the Indenture (other than Section 4.2 of the
Indenture) shall alter or impair the obligation of the Company to pay the principal and interest on
the Note at the times, place and rate, and in the coin or currency, herein prescribed.
As provided in the Indenture and subject to certain limitations therein set forth, the
transfer of this Note is registrable in the Security Register, upon surrender of this Note for
registration of transfer at the office or agency of the Company maintained under Section 10.2 of
the Indenture duly endorsed by, or accompanied by a written instrument of transfer, in form
satisfactory to the Company and the Security Registrar, duly executed by the Holder hereof or his
or her attorney duly authorized in writing, and thereupon one or more new Securities of this
series, of authorized denominations and for the same aggregate principal amount, will be issued to
the designated transferee or transferees. No service charge shall be made for any such registration
of transfer or exchange, but the Company may require payment of a sum sufficient to cover any tax
or other governmental charge payable in connection therewith.
Prior to due presentment of this Note for registration of transfer, the Company, the Trustee
and any agent of the Company or the Trustee may treat the Person in whose name this Note is
registered as the owner hereof for all purposes, whether or not this Note be overdue, and neither
the Company, the Trustee nor any such agent shall be affected by notice to the contrary.
A-6
This global Note is exchangeable for Securities in definitive form only under certain limited
circumstances set forth in the Indenture. Securities of this series so issued are issuable only in
registered form without coupons in denominations of $1,000 and any integral multiple thereof. As
provided in the Indenture and subject to certain limitations herein and therein set forth,
Securities of this series so issued are exchangeable for a like aggregate principal amount of
Securities of this series of a different authorized denomination, as requested by the Holder
surrendering the same.
The Company and, by its acceptance of this Note or a beneficial interest therein, the Holder
of, and any Person that acquires a beneficial interest in, this Note agree that for United States
federal, state and local tax purposes it is intended that this Note constitute indebtedness.
THE INTERNAL LAWS OF THE STATE OF NEW YORK SHALL GOVERN THE INDENTURE AND THE SECURITIES
WITHOUT REGARD TO CONFLICT OF LAW PROVISIONS THEREOF.
A-7