SC 13D
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
Darwin Professional Underwriters, Inc.
(Name of Issuer)
Common Stock, par value $0.01 per share
(Title of Class of Securities)
(CUSIP Number of Class of Securities)
Wesley D. Dupont, Esq.
Allied World Assurance Company Holdings, Ltd
27 Richmond Road
Pembroke HM 08, Bermuda
(441) 278-5400
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
Copies to:
Steven Seidman, Esq.
Willkie Farr & Gallagher LLP
787 Seventh Avenue
New York, NY 10019
(212) 728-8000
(Date of Event which Requires
Filing of this Schedule)
If the filing person has previously filed a statement on Schedule 13G to report the
acquisition which is the subject of this Schedule 13D, and is filing this schedule because
of § 240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following:
SCHEDULE 13D
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NAME OF REPORTING PERSON
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
Allied World Assurance Company Holdings, Ltd |
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CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
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(a) o |
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(b) o |
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SEC USE ONLY |
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SOURCE OF FUNDS* |
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WC, OO |
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CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDING IS REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e) |
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CITIZENSHIP OR PLACE OF ORGANIZATION |
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Bermuda
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SOLE VOTING POWER |
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0 |
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| SHARES |
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SHARED VOTING POWER |
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| OWNED BY |
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9,371,096 (See Item 5) |
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SOLE DISPOSITIVE POWER |
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| PERSON |
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0 |
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SHARED DISPOSITIVE POWER |
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0 |
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AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH PERSON |
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9,371,096 (See Item 5) |
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CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES* |
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PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) |
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55.1 (See Item 5) |
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TYPE OF REPORTING PERSON* |
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*SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
TABLE OF CONTENTS
Item 1. Security and Issuer.
This statement on Schedule 13D relates to the common stock, par value $0.01 per share (“Darwin
Common Stock”), of Darwin Professional Underwriters, Inc., a Delaware corporation (“Darwin”), and
is being filed pursuant to Rule 13d-1 under the Securities Exchange Act of 1934, as amended (the
“Exchange Act”). The principal executive offices of Darwin are located at 9 Farm Springs Road, 2nd
Floor, Farmington, CT 06032.
Item 2. Identity and Background.
This statement is filed on behalf of Allied World Assurance Company Holdings, Ltd, a Bermuda
company (“Allied World”). The address of the principal business and principal office of Allied
World is 27 Richmond Road, Pembroke HM 08, Bermuda. The principal business of Allied World, as a
Bermuda-based specialty insurance and reinsurance company, is underwriting a diversified portfolio
of property and casualty insurance and reinsurance lines of business. Allied World writes direct
property and casualty insurance as well as reinsurance through its operations in Bermuda, the
United States, Ireland and the United Kingdom.
The names, residence or business address, citizenships and present principal occupations or
employment of the executive officers and directors of Allied World are set forth in Annex A hereto.
During the last five years, neither Allied World nor, to the best knowledge of Allied World,
any person named in Annex A, has been (i) convicted in a criminal proceeding (excluding traffic
violations or similar misdemeanors) or (ii) a party to a civil proceeding of a judicial or
administrative body of competent jurisdiction and as a result of such proceeding was or is subject
to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating
activities subject to, federal or state securities laws or finding any violations with respect to
such laws.
Item 3. Source and Amount of Funds or Other Consideration.
On June 27, 2008, Allied World entered into an Agreement and Plan of Merger (the “Merger
Agreement”) with Darwin and Allied World Merger Company, a Delaware corporation and a wholly-owned
subsidiary of Allied World (“Merger Sub”). Upon the terms and subject to the conditions of the
Merger Agreement, at the effective time, Merger Sub will merge with and into Darwin, with Darwin
continuing as the surviving corporation and a wholly-owned subsidiary of Allied World (the
“Merger”).
Pursuant to the Merger Agreement, Allied World is to pay an aggregate purchase price of
approximately $550 million, or $32.00 per share (subject to a downward adjustment in the event that
certain representations by Darwin in the merger agreement with respect to its capitalization are
breached).
Pursuant to the Merger Agreement, at the effective time of the Merger, (i) the directors of
Merger Sub will be the directors of the surviving corporation; (ii) the officers of Darwin will be
the officers of the surviving corporation and (iii) the by-laws of Merger Sub and the certificate
of
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incorporation
set forth as an exhibit to the Merger Agreement will be the by-laws and the
certificate of incorporation of the surviving corporation. After completion of the Merger, the
Darwin Common Stock will be delisted from the New York Stock Exchange.
Concurrently with the execution of the Merger Agreement, Alleghany Insurance Holdings, LLC
(“AIHL”), a wholly-owned subsidiary of Alleghany Corporation, and which owns shares
representing approximately 55.1% of the voting capital stock of Darwin, entered into a voting
agreement with Allied World (the “Voting Agreement”). Under the terms of the Voting Agreement (as
more fully described in Items 4 and 6), AIHL (i) agrees to vote 40% of the outstanding Darwin
Common Stock entitled to vote upon the Merger in favor of adoption of the Merger Agreement and the
transactions contemplated thereby and (ii) agrees to vote all of the Darwin Common Stock it holds
against any other proposal or action that may hinder the consummation of the Merger (including any
Company Acquisition Proposal, as defined in the Merger Agreement).
The descriptions of the Merger Agreement and the Voting Agreement contained in this Schedule
13D are qualified in their entirety by reference to such agreements, which are incorporated by
reference as Exhibits 1 and 2 hereto, respectively.
Item 4. Purpose of Transaction.
AIHL agreed to enter into the Voting Agreement to induce Allied World to enter into the Merger
Agreement and to consummate the transactions contemplated by the Merger Agreement, including,
without limitation, the Merger.
Other than pursuant to and in connection with the Merger Agreement and the Voting Agreement,
as described in Items 3 and 6, neither Allied World nor, to the best knowledge of Allied World, any
person listed in Annex A hereto, has any plans or proposals which relate to or would result in:
(a) the acquisition by any person of additional securities of Darwin, or the disposition of
securities of Darwin; (b) an extraordinary corporate transaction, such as a merger, reorganization
or liquidation, involving Darwin or any of its subsidiaries; (c) a sale or transfer of a material
amount of assets of Darwin or any of its subsidiaries; (d) any change in the present Board of
Directors or management of Darwin, including any plans or proposals to change the number or term of
directors or to fill any existing vacancies on the board; (e) any material change in the present
capitalization or dividend policy of Darwin; (f) any other material change in Darwin’s business or
corporate structure; (g) changes in Darwin’s charter, by-laws or instruments corresponding thereto
or other actions which may impede the acquisition of control of Darwin by any person; (h) causing a
class of securities of Darwin to be delisted from a national securities exchange or to cease to be
authorized to be quoted in an inter-dealer quotation system of a registered national securities
association; (i) a class of equity securities of Darwin becoming eligible for termination of
registration pursuant to Section 12(g)(4) of the Exchange Act; or (j) any action similar to any of
those enumerated above (although Allied World reserves the right to develop such plans).
Item 5. Interest in Securities of the Issuer.
(a) and (b). All of the shares of Darwin Common Stock owned by AIHL, or 9,371,096 shares, are
subject to the Voting Agreement (the “Voting Agreement Shares”), which as of June 27, 2008,
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represents approximately 55.1% of the issued and outstanding shares of Darwin Common Stock. AIHL
has agreed to (i) vote 40% of the outstanding Darwin Common Stock entitled to vote upon the Merger
in favor of adoption of the Merger Agreement and the transactions contemplated thereby and (ii)
vote all of the Darwin Common Stock it holds against any other proposal or action that may hinder
the consummation of the Merger (including any Company Acquisition Proposal, as defined in the
Merger Agreement). As of June 27, 2008, 40% of the issued and outstanding shares of Darwin Common
Stock was equal to 6,802,818 shares. By virtue of the Voting Agreement, Allied World may be deemed
to share with AIHL the power to vote or direct the voting of the Voting Agreement Shares. However,
Allied World is not entitled to any other rights as a stockholder of Darwin as to the Voting
Agreement Shares, and does not have any right to dispose or direct the disposition of the Voting
Agreement Shares, except for the restrictions described in Item 6.
Pursuant to Rule 13d-4 under the Exchange Act, Allied World hereby states that this Schedule
13D shall not be deemed an admission that Allied World is, for the purposes of Section 13(d) of the
Exchange Act, the beneficial owner of any equity securities of Darwin, and Allied World expressly
disclaims beneficial ownership of the Voting Agreement Shares.
To the best knowledge of Allied World, no shares of Darwin Common Stock are beneficially owned
by any of the persons named in
Annex A.
(c). Neither Allied World, nor, to the best knowledge of Allied World, any person named in Annex
A, has effected any transaction in Darwin Common Stock during the past 60 days.
(d) and (e). Not applicable.
Item 6. Contracts, Arrangements, Understandings or Relationships With Respect to Securities of the Issuer.
Under the terms of the Voting Agreement, AIHL (i) agrees to vote 40% of the outstanding Darwin
Common Stock entitled to vote upon the Merger in favor of adoption of the Merger Agreement and the
transactions contemplated thereby and (ii) agrees to vote all of the Darwin Common Stock it holds
against any other proposal or action that may hinder the consummation of the Merger (including any
Company Acquisition Proposal, as defined in the Merger Agreement).
Subject to the terms and conditions contained in the Voting Agreement, AIHL shall deliver and
grant, three business days prior to the applicable meeting of stockholders, a revocable proxy to
the proxyholders named in Darwin’s proxy card (the “Proxyholders”) granting the Proxyholders the
power and authority to vote the number of AIHL’s shares of Darwin Common Stock that is equal to
forty percent (40%) of the outstanding Darwin Common Stock entitled to vote as of the relevant
meeting of stockholders in favor of the adoption of the Merger
Agreement.
Pursuant to the Voting Agreement, AIHL shall not, during the Term (as defined below), amend,
withdraw, revoke, alter, modify or change such proxy at any time prior to the date of the meeting
of stockholders of Darwin in favor of the adoption of the Merger Agreement (or such
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adjournment or postponement thereof). However, AIHL may amend, withdraw, revoke, alter, modify or
change such proxy if such meeting (or the applicable adjournment or postponement thereof) is
postponed or adjourned for a date that is more than three business days after such amendment,
withdrawal, revocation, alteration, modification or change. Notwithstanding any such amendment,
withdrawal, revocation, alteration, modification or change, AIHL’s obligations pursuant to the
Voting Agreement (and the exceptions to those obligations) apply, during the Term (as defined
below), with respect to any meeting convened following such a postponement, or reconvened following
such an adjournment, at which a vote in favor of the Merger Agreement is sought.
Additionally, during the Term (as defined below) at any meeting of stockholders of Darwin or
at any adjournment or postponement thereof, in any action by written consent of the stockholders of
Darwin, or in any other circumstances upon which the vote, consent or other approval of AIHL is
sought, AIHL shall vote (or cause to be voted) the Voting Agreement Shares (i) against any Company
Acquisition Proposal (as defined in the Merger Agreement); and (ii) against any other proposal or
action that could reasonably be expected to impede, interfere with, delay or postpone the Merger or
change in any manner the voting rights of any class of shares of Darwin (including any amendments
to Darwin’s charter or by-laws).
Pursuant to the Voting Agreement, and subject to the terms and conditions contained therein,
AIHL has agreed that until the termination of the Voting Agreement, except pursuant to the Voting
Agreement, AIHL shall not (i) sell, transfer, pledge, assign or otherwise dispose of (including by
gift) (collectively, “Transfer”), or consent to any
Transfer of, any Voting Agreement Shares or any interest
therein, except pursuant to the Merger; (ii) except as does not prohibit compliance with the Voting
Agreement, grant any proxy, power-of-attorney or other voting authorization in or with respect to
the Voting Agreement Shares or deposit the Voting Agreement Shares into a voting trust or enter
into a voting agreement or voting arrangement with respect to the
Voting Agreement Shares; or (iii)
take any action prohibited by Section 7.03(a) of the Merger Agreement.
The Voting Agreement provides that it will terminate upon the earliest of (i) the effective
time of the Merger, (ii) the termination of the Merger Agreement in accordance with its terms,
(iii) the date of an Adverse Recommendation Change (as defined in the Merger Agreement), or (iv)
the time of any modification to the Merger Agreement that adversely affects Darwin or its
stockholders in any material respect. The period from the date of the Voting Agreement through
such termination is defined as the “Term”.
Except as referred to above, there are no contracts, arrangements, understandings or
relationships among the persons named in Item 2 or between such persons and any other person with
respect to any securities of Darwin.
Item 7. Material to be Filed as Exhibits.
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| EXHIBIT |
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DESCRIPTION |
99.1
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Agreement and Plan of Merger by and among Allied World Assurance Company Holdings,
Ltd, Allied World Merger Company and Darwin Professional Underwriters, Inc., dated June
27, 2008. |
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99.2
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Voting Agreement by and among Allied World Assurance Company Holdings, Ltd, Allied
World Merger Company, and Alleghany Insurance Holdings, LLC, dated June 27, 2008. |
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SIGNATURES
After reasonable inquiry and to the best of its knowledge and belief, the undersigned
certifies that the information set forth in this statement is true, complete and correct.
Dated: July 7, 2008
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ALLIED WORLD ASSURANCE COMPANY HOLDINGS, LTD |
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By:
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/s/ Wesley D. Dupont |
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Name:
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Wesley D. Dupont |
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Title:
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Senior Vice President and General Counsel |
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ANNEX A
The name, business address and present principal occupation or employment of each of the directors
and executive officers of Allied World as set forth below. Each person’s business address is c/o
Allied World Assurance Company Holdings, Ltd, 27 Richmond Road, Pembroke HM 08, Bermuda. Except as
indicated, each person is a citizen of the United States.
Directors of Allied World
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Principal Occupation |
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Scott A. Carmilani
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Chairman, President and Chief Executive Officer of
Allied World |
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James F. Duffy
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Retired |
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Bart Friedman
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Partner at Cahill Gordon & Reindel LLP |
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Scott Hunter
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Independent consultant to Bermuda’s financial
services industry (Citizen of Bermuda) |
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Michael I.D. Morrison
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Retired |
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Mark R. Patterson
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Chairman of MatlinPatterson Asset Management |
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Samuel J. Weinhoff
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Consultant to the insurance industry |
Executive Officers of Allied World
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Title with Allied World |
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(Principal Occupation) |
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Scott A. Carmilani
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President, Chief Executive Officer and Chairman of
the Board |
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Joan H. Dillard
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Senior Vice President and Chief Financial Officer |
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Wesley D. Dupont
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Senior Vice President, General Counsel and Secretary |
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Title with Allied World |
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(Principal Occupation) |
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Marshall J. Grossack
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Senior Vice President — Chief Corporate Actuary |
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Richard E. Jodoin
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Vice Chairman, Allied World Assurance Company (U.S.) Inc.
and Allied World National Assurance Company |
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W. Gordon Knight
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President, Allied World National Assurance Company |
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John T. Redmond
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President — Allied World Assurance Company (Europe)
Limited and Allied World Assurance Company
(Reinsurance) Limited (Citizen of Ireland) |