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UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
LOUISIANA MUNICIPAL POLICE
EMPLOYEES RETIREMENT SYSTEM,
Individually on Behalf of Itself and All
Others Similarly Situated,
Case No. 13 CV 0933-ALC
CLASS ACTION
Plaintiff,
ECF CASE
V.
ALTERRA CAPITAL HOLDINGS
LIMITED, W. MARSTON BECKER,
MICHAEL O'REILLY, JAMES D. CAREY,
MERYL D. HARTZBAND, WILLIS T.
KING, JR., JAMES L. ZECH, MARIO P.
TORSIELLO, K. BRUCE CONELL,
JAMES H. MACNAUGHTON, W.
THOMAS FORRESTER, STEPHAN F.
NEWHOUSE, ANDREW H. RUSH,
MARKEL CORPORATION, and
COMMONWEALTH MERGER
SUBSIDIARY LIMITED,
Defendants.
DECLARATION OF ERIC J. O'BELL
IN SUPPORT OF PROPOSED LEAD
PLAINTIFF'S MOTION FOR
PRELIMINARY APPROVAL OF
SETTLEMENT AND CERTIFICATION
OF SETTLEMENT CLASS
I, Eric J. O'Bell, hereby declare as follows:
1.
I am a member of good standing of the bar of the State of Louisiana and
Pennsylvania and have been admitted pro hac vice in the above captioned matter. I am a member
of the O'Bell Law Firm, LLC. I submit this declaration in support of Proposed Lead Plaintiffs
Motion for Preliminary Approval of Settlement and Certification of Settlement Class.
2.
Attached as exhibits are true and correct copies of the following:
Exhibit 1:
Stipulation and Agreement of Compromise and Settlement, along with
Exhibits A-D attached in globo.
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I declare under penalty of perjury under the laws of the United States of America that the
foregoing facts are true and correct.
Executed this 26 day of June, 2013', at Metairie, Louisiana,
Is! Eric I O'Be!l
-2-
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Exhibit 1
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Louisiana Municipal Police Employees Retirement System v. Alterra Capital Holdings Limited et
al., No. 13-cv-0933 (S.D.N.Y.)
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STIPULATION AND AGREEMENT OF COMPROMISE AND SETTLEMENT
This Stipulation and Agreement of Compromise and Settlement (the "Settlement
Agreement"), dated June 20, 2013, which is entered into by, between and among (i) the
Louisiana Municipal Police Employees Retirement System ("Plaintiff'), on behalf of itself as
well as members of the Settlement Class (defined in paragraph 1(1)) and (ii) defendants W.
Marston Becker, Michael O'Reilly, James D. Carey, Meryl D. Hartzband, Willis T. King, Jr.,
James L. Zech, Mario P. Torsiello, K. Bruce Connell, James H. Macnaughton, W. Thomas
Forrester, Stephan F. Newhouse, Andrew H. Rush, Alterra Capital Holdings Limited ("Alterra"),
Markel Corporation ("Markel"), and Commonwealth Merger Subsidiary Limited ("Merger Sub")
which has merged with and into Alterra (collectively, the "Defendants," and collectively with the
Plaintiff, the "Parties"), by and through their undersigned attorneys, states all of the terms of the
settlement and resolution of the action entitled Louisiana Municipal Police Employees
Retirement System v. Alterra Capital Holdings Limited et al., No. 13-cv-0933 (S.D.N.Y.) (the
"Action"), and is intended by all of the Parties to fully and finally compromise, resolve,
discharge and settle the Released Claims (defined in paragraph 16)) subject to the approval of
the Court:
BACKGROUND TO THE SETTLEMENT
WHEREAS, the background to the Settlement (defined in paragraph 1(k)) is set forth in
paragraphs A through J below:
A.
On December 19, 2012, Alterra and Markel announced a definitive merger
agreement (the "Merger Agreement") pursuant to which each Alterra common share would be
converted into the right to receive 0.04315 Markel common shares plus a cash payment of $10
per share (the "Transaction");
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B.
On January 18, 2013, Alterra and Markel filed with the Securities Exchange
Commission (the "SEC") a definitive proxy statement on Form DEFM14A relating to the
Transaction (the "Proxy");
C.
On February 8, 2013 the Plaintiff commenced Action in the United States District
Court for the Southern District of New York (the "Court") as a putative class action against the
Defendants alleging, among other things, that the Proxy misrepresents and/or omits material
information necessary for Alterra's public shareholders to make an informed decision regarding
whether to vote in favor of the Transaction;
D.
On February 13, 2013, Plaintiff filed a Motion for Preliminary Injunction seeking
to enjoin the shareholder vote on the Transaction based on alleged deficiencies in the Proxy;
E.
On February 15, 2013, in response to the Plaintiff's demands for further
disclosure to Alterra's shareholders and as a result of negotiations among the Parties, Alterra
included certain additional and/or revised disclosures (the "Supplemental Disclosures"),
substantially in the form of Exhibit A, in its Definitive Proxy Statement filed with the SEC (the
"Definitive Proxy").
F.
On or as of February 15, 2013, the Parties executed a Memorandum of
Understanding ("MOU"). The MOU memorialized the terms of the Parties' agreement in
principle to settle the Action.
G.
Defendants acknowledged that the pendency of the Action and the efforts of the
Plaintiff's counsel caused their decision to include the Supplemental Disclosures in the
Definitive Proxy to Alterra's shareholders.
H.
As further provided in the MOU, the Parties contemplated that the MOU
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ultimately would be replaced by this Settlement Agreement, to be prepared by the Parties and
submitted to the Court for approval, and that this Settlement Agreement would include all of the
terms of the Settlement, including proposing the certification of a class for settlement purposes
only.
I.
Prior to negotiating and entering into the MOU, the Plaintiff's counsel received
productions of documents from Alterra which they reviewed and analyzed. The Plaintiff's
counsel reserved the right to conduct additional discovery to confirm their, and the Plaintiff's,
conclusion that the Settlement was fair, adequate, reasonable and in the best interests of the
putative class (the "Confirmatory Discovery"). The Plaintiff's counsel deemed it appropriate and
necessary to conduct Confirmatory Discovery before entering into this Settlement Agreement.
The post-MOU Confirmatory Discovery occurred and included the depositions of W. Marston
Becker, the Chief Executive Officer of Alterra, and Robert Giammarco, a representative of Bank
of American Merrill Lynch.
J.
On February 26, 2013, shareholders of Alterra and Markel voted to approve the
Transaction.
WHEREAS, the Defendants vigorously have denied, and vigorously continue to deny, all
allegations of wrongdoing, fault, liability or damage with respect to each and all claims asserted
in the Action, including that any of them has committed any violation of any law, rule or
regulation; that any of them has acted improperly in any way; that any of them has breached any
duty; and/or that any of them has any liability or owe any damages of any kind to the Plaintiff
and/or the Settlement Class or any member thereof. The Defendants further deny that any of the
provisions of the Supplemental Disclosures was or is required under any applicable law, rule or
regulation, but are entering into this Settlement Agreement solely because they consider it
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desirable that the Action be settled and dismissed with prejudice in order to, among other things,
(i) eliminate the burden, inconvenience, expense, risk and distraction of further litigation, and (ii)
finally put to rest and terminate all the claims that were or could have been asserted against any
of the Defendant Releasees (defined in paragraph 1(c)).
WHEREAS, the Plaintiff's counsel has reviewed and analyzed the facts and
circumstances relating to the claims asserted and which could have been asserted in the Action,
including conducting arm's-length discussions with counsel to the Defendants, analyzing
documents produced by the Defendants and obtained through public sources, analyzing
applicable case law and other authorities and conducting the Confirmatory Discovery. Based on
these investigations and analyses, the Plaintiff has decided to enter into the Settlement
Agreement and to settle the Action after taking into account, among other things, (i) their belief
that the litigation of the Action and the Settlement already have delivered substantial benefits to
the Settlement Class; (ii) the facts developed during discovery; (iii) the attendant risks of
continued litigation and the uncertainty of the outcome of the Action; (iv) the conclusion reached
by the Plaintiff and the Plaintiff's counsel that the Settlement upon the terms and provisions set
forth in this Settlement Agreement is fair, reasonable, adequate and in the best interests of the
Settlement Class; (v) the probability of success on the merits of the allegations made in the
Action, including the uncertainty relating to proof of those allegations; and (vi) the desirability of
permitting the Settlement to be consummated as provided by the terms of this Settlement
Agreement. The Plaintiff believes that the claims asserted in the Action have merit. The
Plaintiff and Plaintiff's Counsel have concluded that the Proxy with the Supplemental
Disclosures resulting from the Settlement provided Alterra's shareholders with material
information sufficient to cast a fully-informed vote with respect to the Transaction.
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WHEREAS, the Parties recognize the time and expense that would be incurred by further
litigation and the uncertainties inherent in such further litigation against Defendants through trial
and through appeals.
WHEREAS, the Settlement of the Action on the terms and conditions set forth in this
Settlement Agreement includes, but is not limited to, a release of all claims that were or could
have been asserted in the Action or that arise out of or relate to any of the allegations asserted in
the Action.
TERMS OF THE STIPULATION AND SETTLEMENT AGREEMENT
NOW, THEREFORE, IT IS HEREBY STIPULATED, CONSENTED TO AND
AGREED, by the Plaintiff, for itself and on behalf of the Settlement Class, and the Defendants
that, subject to the approval of the Court pursuant to, inter alia, Rule 23(e) of the Federal Rules
of Civil Procedure, and the other conditions set forth in this Settlement Agreement, for the good
and valuable consideration set forth in this Settlement Agreement and conferred on the Plaintiff
and the Settlement Class, the receipt and sufficiency of which hereby are acknowledged, the
Action shall be finally and fully settled, compromised and dismissed, on the merits and with
prejudice, that the Class Released Claims (defined in paragraph 1(a)) shall be finally and fully
compromised, settled, released and dismissed with prejudice as to the Defendant Releasees, and
that the Defendants Released Claims (defined in paragraph 1(b)) shall be finally and fully
compromised, settled and released with prejudice as to the Plaintiff Releasees (defined in
paragraph 1(h)), in the manner and upon the terms and conditions set forth in this Settlement
Agreement.
1.
The following capitalized terms, used in this Settlement Agreement and the
Exhibits attached hereto (the "Exhibits"), shall have the meanings specified below:
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(a)
"Class Released Claims" means all claims, including Unknown Claims
(defined in paragraph 1(n)), that were brought or could have been brought by the Plaintiff or any
Settlement Class Member in the Action, or that arise out of or relate to any of the allegations that
are or were asserted in the Action; provided however, that the Class Released Claims shall not
include (1) properly perfected claims for appraisal under Bermuda law; (2) claims by any of the
Parties to enforce the terms of the Settlement; or (3) any federal securities claim any Settlement
Class member may have against Markel as a shareholder of Markel to the extent that such federal
securities law claim is unrelated to the Transaction, the Merger Agreement or any disclosures,
non-disclosures or public statements made in connection with the Transaction or Merger
Agreement.
(b)
"Defendants Released Claims" means all claims, including Unknown
Claims, arising out of or relating to the initiation, prosecution and/or resolution of the Action,
provided however, that the Defendants Released Claims shall not include any claim by any of the
Defendant Releasors (defined in paragraph 7) to enforce the terms of the Settlement Agreement,
the Settlement and/or the Order and Final Judgment.
(c)
"Defendant Releasees" means each and all of the Defendants and each
and all of their respective past and present predecessors, successors, parent entities, subsidiaries,
affiliates, general or limited partners or partnerships, and agents (including, without limitation,
any past or present officers, directors, stockholders, members, managers, general or limited
partners, limited liability companies, agents, representatives, assignors, employees, advisors,
accountants, attorneys, financial or investment advisors (including, without limitation, Bank of
America Merrill Lynch and Citigroup), other advisors, consultants, insurers, co-insurers,
reinsurers, investment bankers and each and all of their respective heirs, executors,
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administrators, trustees, personal or legal representatives, estates, successors or assigns).
(d)
"Effective Date" means the date on which the Order and Final Judgment
(defined in paragraph 1 (f)) has either been finally affirmed on appeal or is no longer subject to
appeal and the time for any petition for re-argument, appeal or review thereof has expired.
(e)
"Notice" means the Notice of Pendency Of Class Action, Proposed
Settlement, Settlement Hearing And Right To Appear, substantially in the form of Exhibit B.
(1) "Order and Final Judgment" means the Order and Final Judgment to be
entered in the Action, substantially in the form of Exhibit D, approving (among other things) this
Settlement Agreement and dismissing the Action with prejudice, or as modified by the Court
with the written consent of the Parties or as modified by agreement of the Parties in writing.
"Person" means any individual, corporation, partnership, limited liability company, association,
affiliate, joint stock company, estate, trust, unincorporated association, entity, government and
any political subdivision thereof, or any other type of business or legal entity.
(g)
"Plaintiff' means the Louisiana Municipal Police Employees' Retirement
System, individually and on behalf of the Settlement Class.
(h)
"Plaintiffs Counsel" means O'Bell, LLC, 3500 North Hullen Street,
Metairie, Louisiana, 70002; Brannon Law Firm, LLC, 3500 North Hullen Street, Metairie,
Louisiana, 70002; and Glancy Binkow & Goldberg, LLP, 77 Water Street, Suite 721, New York,
New York 10005.
(i)
'Plaintiff Releasees" means the Plaintiff and the Plaintiffs counsel and
each and all of their respective heirs, executors, administrators, trustees, personal or legal
representatives, estates, successors or assigns.
(j)
"Preliminary Approval Order" means the order entered by the Court with
respect to notice of the Settlement, the Settlement Hearing and the administration of the
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Settlement, in substantially the form attached as Exhibit C, providing for (among other things)
notice to the Settlement Class Members of the hearing on this Settlement.
(k)
"Released Claims" means, collectively, the Class Released Claims and the
Defendants Released Claims.
(1)
"Settlement" means the settlement of the Action by, between and among
the Plaintiff, on behalf of itself and the Settlement Class, and the Defendants, as set forth in this
Settlement Agreement.
(m)
"Settlement Class Members" or the "Settlement Class" means a non-opt-
out settlement class of all record holders and beneficial owners of Alterra common stock who
held such stock at any time during the period beginning on and including December 19, 2012,
through and including May 1, 2013 including any and all of their respective successors-ininterest, successors, predecessors-in-interest, predecessors, representatives, trustees, executors,
administrators, estates, heirs, assigns or transferees, immediate and remote, and any Person
acting for or on behalf of, or claiming under, any of them, and each of them, together with their
respective
successors-in-interest,
successors,
predecessors-in-interest,
predecessors,
representatives, trustees, executors, administrators, estates, heirs, assigns and transferees;
provided however, that the Settlement Class shall exclude the Defendants and their respective
immediate family members, directors, partners, direct or indirect parent or subsidiary entities,
and any other Person over whom or which any Defendant exercises sole or exclusive control.
For purposes of this Settlement only, the Action shall be certified conditionally as a non-opt-out
class action pursuant to Rule 23(b)(1) of the Federal Rules of Civil Procedure.
(n)
"Settlement Hearing" means the hearing to be held by the Court to
determine, among other things, whether to certify the Settlement Class for settlement purposes;
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whether the proposed Settlement should be approved as fair, reasonable and adequate and in the
best interests of the Settlement Class; whether all Released Claims should be deemed released,
acquitted and discharged; whether the Action should be dismissed with prejudice; whether the
Order and Final Judgment approving the Settlement should be entered; and, subject to paragraph
15, whether and in what amount any award of attorneys' fees and reimbursement of expenses
should be paid to the Plaintiff's counsel by any or all of the Defendants (or their successors-ininterest) in the Action.
(o)
"Unknown Claims" means any of the Released Claims which any Plaintiff
Releasor or any Defendant Releasor does not know or suspect to exist at or prior to the Effective
Date which, if known by her, him or it, might have affected her, his or its settlement with and
release of any or all of, respectively, the Defendant Releasees or the Plaintiff Releasees, or might
have affected her, his or its decision not to object to the Settlement. The Plaintiff acknowledges,
and the Class Members by operation of law shall be deemed to have acknowledged, that each of
them may discover facts in addition to or different from those now known or believed to be true
with respect to the Class Released Claims, but that it is the intention of the Plaintiff; and by
operation of law the Settlement Class Members, to completely, fully, finally and forever
extinguish any and all Class Released Claims, known or unknown, suspected or unsuspected,
which now exist, or heretofore existed, or hereafter may exist, and without regard to the
subsequent discovery of any additional or different facts. The Plaintiff acknowledges, and the
Settlement Class Members by operation of law shall be deemed to have acknowledged, that the
inclusion of "Unknown Claims" in the definition of "Class Released Claims" separately was
bargained for and was a material element of the Settlement and was relied upon by each and all
of the Defendants in entering into the Settlement Agreement. The Defendants acknowledge that
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each of them may discover facts in addition to or different from those now known or believed to
be true with respect to the Defendants Released Claims, but that it is the intention of the
Defendants to completely, fully, finally and forever extinguish any and all Defendants Released
Claims, known or unknown, suspected or unsuspected, which now exist, or heretofore existed, or
hereafter may exist, and without regard to the subsequent discovery of any additional or different
facts. The Defendants acknowledge that the inclusion of "Unknown Claims" in the definition of
"Defendants Released Claims" separately was bargained for and was a material element of the
Settlement and was relied upon by the Plaintiff in entering into the Settlement Agreement.
CONDITIONAL CERTIFICATION OF THE SETTLEMENT CLASS
2.
The Plaintiff avers, and solely for the purposes of this Settlement the Defendants
do not contest, that the Action is appropriate for class treatment pursuant to Rules 23(a) and
23(b)(1) of the Federal Rules of Civil Procedure (for purposes of settlement) because (a) the
Settlement Class is so numerous that joinder of all members, whether otherwise required or
permitted, is impracticable; (b) there are questions of law or fact common to the Settlement Class
which predominate over any questions affecting other individual Settlement Class Members; (c)
the claims and defenses of Plaintiff are typical of the claims and defenses of the Settlement
Class; (d) Plaintiff will fairly and adequately represent and protect the interests of the Settlement
Class; (e) a class action is superior to other available methods for the fair and efficient settlement
of the Action; and (f) prosecuting separate actions by individual Settlement Class Members
would create a risk of (I) inconsistent or varying adjudications with respect to individual
Settlement Class Members that would establish incompatible standards of conduct for the party
opposing the class or (2) adjudications with respect to Settlement Class Members that, as a
practical matter, would be dispositive of the interests of the other Settlement Class Members not
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parties to the individual adjudications or would substantially impair or impede their ability to
protect their interests. On that basis and solely for the purposes of this Settlement, the Action
shall be maintained and proceed as a class action pursuant to Rule 23(b)(1) of the Federal Rules
of Civil Procedure on behalf of the Settlement Class,
3.
The certification of the Settlement Class shall be binding only with respect to this
Settlement Agreement. In the event that this Settlement Agreement is terminated pursuant to its
terms; that this Settlement Agreement is not approved in all material respects by the Court; that
the Defendants withdraw from the Settlement pursuant to the terms hereof; that the Effective
Date does not occur; that the Settlement does not otherwise become final for any reason; or that
any judgment or order entered pursuant hereto is reversed, vacated or modified in any material
respect by the Court or any other court, the certification of the Settlement Class shall be deemed
vacated, the Action shall proceed as though the MOU and this Settlement Agreement had never
existed, the Settlement Class had never been certified, and no reference to the certification, or
lack thereof, of the Settlement Class, or to the Settlement Agreement or any document related
thereto, shall be made by any of the Parties, any of the Plaintiff Releasces or any of the
Defendant Releasees for any purpose, except as expressly authorized by the terms of this
Settlement Agreement. If any of the foregoing events occur, the Defendants reserve the right to
oppose certification of any class in any proceeding and to fully defend any proceeding, and,
conversely, the Plaintiff reserves the right to move for certification of a class for all purposes.
SETTLEMENT CONSIDERATION
4.
As a result of the Plaintiffs prosecution of the Action and their agreement to
settle the Action on the terms of this Settlement Agreement, the Defendants took steps to confer
substantial benefits upon the Settlement Class Members, Specifically, Alterra included the
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Supplemental Disclosures in its Definitive Proxy, set forth in Exhibit A, attached hereto and filed
with the SEC on or about February 15, 2013.
5.
The Defendants acknowledge that the prosecution of the Action and the efforts of
and negotiations with the Plaintiffs Counsel caused their decision to provide the above benefits
to the Settlement Class Members.
RELEASE
6.
In consideration of the benefits provided to the Settlement Class Members in
paragraph 4, upon the Effective Date, the Plaintiff and each and all of the Settlement Class
Members, on behalf of herself, himself or itself and each and all of her, his or its respective
affiliates, predecessors, successors and assigns, and each and all of their respective current and
former officers, directors, managers, members, partners, employees, agents, security holders,
attorneys and representatives in their capacities as such, and each of their respective heirs,
executors, administrators, legal representatives, assigns or transferees, immediate and remote,
and any Person acting for or on behalf of or claiming under any of them, individually and
collectively (collectively, the "Plaintiff Releasors") shall and hereby do completely, fully, finally
and forever release, relinquish, acquit, settle and discharge each and all of the Defendant
Releasees from any and all of the Class Released Claims, including Unknown Claims, from the
beginning of the world to the date of this Settlement Agreement; provided however, that this
release does not extend to claims (a) arising out of ordinary course of business commercial
dealings, not arising out of or related to any of the allegations that are or were asserted in the
Action, between any of the Plaintiff Releasors and any of the Defendant Releasees, and (b) to
enforce the terms of the Settlement Agreement, the Settlement and/or the Order and Final
Judgment.
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7.
Upon the Effective Date, each of the Defendants, on behalf of himself or itself
and his or its respective affiliates, predecessors, successors and assigns, and each and all of their
respective current and former officers, directors, managers, members, partners, employees,
agents, security holders, attorneys and representatives in their capacities as such, and each of
their respective heirs, executors, administrators, legal representatives, assigns or transferees,
immediate and remote, and any Person acting for or on behalf of or claiming under any of them,
individually and collectively (collectively, the "Defendant Releasors"), shall and hereby do
completely, fully, finally and forever release, relinquish, acquit, settle and discharge each and all
of the Plaintiff Releasees from any and all of the Defendants Released Claims, including
Unknown Claims, from the beginning of the world to the date of this Settlement Agreement;
provided however, that this release does not extend to claims (a) arising out of ordinary course of
business commercial dealings, not arising out of or related to any of the allegations that are or
were asserted in the Action, between any of the Defendant Releasors and any of the Plaintiff
Releasees, and (b) to enforce the terms of the Settlement Agreement, the Settlement and/or the
Order and Final Judgment.
8.
Each of the Plaintiff Releasors and each of the Defendant Releasors shall be
deemed to relinquish to the full extent permitted by law, the provisions of, and the rights and
benefits conferred by Section 1542 of the California Civil Code ("Section 1542") or any other
similar law, rule or regulation of any other state or country. Section 1542 provides:
A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE
CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER FAVOR
AT THE TIME OF EXECUTING THE RELEASE WHICH IF KNOWN BY HIM OR
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HER MUST HAVE MATERIALLY AFFECTED HIS OR HER SETTLEMENT WITH
THE DEBTOR,
9.
Except as otherwise provided in this Settlement Agreement, including at
paragraphs 10(e), 11 and 15 below, each of the Parties is to bear her, his or its own costs,
expenses and attorneys' fees in connection with the Action and the Settlement Agreement,
SUBMISSION OF THE SETTLEMENT
TO THE COURT FOR APPROVAL
10.
As soon as practicable after this Settlement Agreement has been executed, the
Parties jointly shall apply to the Court for entry of the Preliminary Approval Order, substantially
in the form of Exhibit C, which specifically shall include provisions that, among other things,
will:
(a)
preliminarily certify the Action, pending the Settlement Hearing, as a non-
opt-out class action on behalf of the Settlement Class for purposes of this
Settlement only, pursuant to Rule 23(b)(1) of the Federal Rules of Civil
Procedure;
(b)
certify Plaintiff, Louisiana Municipal Police Employees' Retirement
System as Class representative and Plaintiff's Counsel, O'Bell, LLC and Brannon
Law Finn, LLC as Lead Counsel for the Class;
(c)
schedule the Settlement Hearing to consider: (i) whether Plaintiff is an
adequate representative of the Settlement Class, (ii) whether the Settlement is fair,
reasonable, adequate and in the best interests of the Settlement Class, (iii) whether
the Order and Final Judgment should be entered, (iv) any objections to the
Settlement, (v) the Fee Application (defined in paragraph 15), and any objections
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thereto, and (vi) any such other matters as the Court may deem necessary and
appropriate;
(d)
approve the Notice, substantially in the form of Exhibit 13, and find that
such Notice constitutes adequate notice to the Settlement Class Members pursuant
to Rule 23(c)(2)(A) of the Federal Rules of Civil Procedure;
(e)
direct that Alterra shall be responsible for providing the Notice,
substantially in the form of Exhibit B, to all Settlement Class Members who will
be bound by the provisions of Paragraphs 6, 7 and 8 of this Settlement
Agreement, and Alterra shall pay all reasonable costs and expenses incurred in
providing that Notice, with the understanding that such Notice shall be effected
by mail or such other method or methods as the Court deems appropriate;
(f)
provide that any Settlement Class Member who objects to the terms of the
Settlement Agreement, the proposed Settlement, the settlement class action
determination, the entry of the Order and Final Judgment approving the
Settlement and/or the Fee Application, or who otherwise wishes to be heard at the
Settlement Hearing, may appear in person or by her, his or its attorney at the
Settlement Hearing and present any evidence or argument that may be proper and
relevant; provided, however, that no Person (other than the Parties) shall be heard,
and no papers, briefs, pleadings or other documents submitted by any such Person
shall be received and considered by the Court (unless the Court in its discretion
otherwise shall direct, upon application of such Person and for good cause
shown), unless no later than ten (10) calendar days prior to the Settlement
Hearing, (i) written notice of the intention to appear, (ii) a detailed statement of all
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of such Person's objections to any matter before the Court, including all of the
grounds therefor and/or the reasons for such Person's desiring to appear and to be
heard, signed personally by such objector, (iii) documentary proof of such
Person's membership in the Settlement Class, and (iv) all documents and writings
which such Person desires the Court to consider are filed by such Person with the
Court and, simultaneously with or before such filing, are served by hand or
overnight delivery upon the counsel to the Parties designated in the Preliminary
Approval Order and identified in the Notice;
(g)
preliminarily enjoin all proceedings in the Action (other than proceedings
as may be necessary to carry out the terms and conditions of the Settlement or to
provide status reports to the Court) and order that, pending final determination of
whether the Settlement provided for in this Settlement Agreement should be
approved, the Plaintiff and all the Settlement Class Members, or any of them,
shall be barred and enjoined from commencing, prosecuting, instigating,
continuing or in any way participating in the commencement or prosecution of
any action asserting any or all of the Class Released Claims, either directly,
representatively, derivatively or in any other capacity, against any or all of the
Defendant Releasees, or challenging the Settlement (other than in the Action in
accordance with the procedures established by the Court); and
(h)
provide that the Settlement Hearing may, from time to time and without
further notice to the Settlement Class Members, be continued or adjourned by
order of the Court.
11.
Alterrra or its successor-in-interest shall assume the administrative responsibility
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of providing, and shall bear the sole expense of preparing and disseminating, the Notice to the
Settlement Class, as required by the Preliminary Approval Order. At least ten (10) business days
before the Settlement Hearing, Alterra shall file with the Court appropriate proof that the Notice
required by the Preliminary Approval Order has been provided to the Settlement Class Members.
ORDER AND FINAL JUDGMENT
12.
If the Settlement (including any modification made with the written consent of the
Parties) is approved by the Court following the Settlement Hearing as fair, reasonable, adequate
and in the best interests of the Settlement Class, the Parties jointly shall request the Court to enter
the Order and Final Judgment, substantially in the form of Exhibit D. The Order and Final
Judgment shall, among other things:
(a)
find that the prerequisites to a class action set forth in Rule 23(a) of the
Federal Rules of Civil Procedure are satisfied, that Plaintiff is an adequate
representatives of the Settlement Class, and that the Action properly may be
maintained as a non-opt-out class action pursuant to Rule 23(b)(1) of the Federal
Rules of Civil Procedure, and certify the Settlement Class;
(b)
approve the Settlement, and all transactions preparatory or incident
thereto, as fair, reasonable, adequate and in the best interests of the Settlement
Class Member;
(c)
authorize and direct performance of the Settlement in accordance with all
of its terms and conditions;
(d)
dismiss the Action, with prejudice as against the Plaintiff and the
Settlement Class Members, and all of them, without costs except as hereinafter
provided, and extinguish all Released Claims against all Defendant Releasees and
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all Plaintiff Releasees;
(e)
determine the Fee Application; and
(f)
reserve jurisdiction over the Action, without affecting the finality of the
Order and Final Judgment, with respect to all matters relating to the
administration, consummation, construction and enforcement of the Settlement.
CONDITIONS OF THE SETTLEMENT AGREEMENT, EFFECT OF DISAPPROVAL,
CANCELLATION OR TERMINATION OF THE SETTLEMENT AGREEMENT
13.
The Effective Date shall be conditioned solely upon the entry by the Court of the
Order and Final Judgment and either: (a) the final affirmance of the Order and Final Judgment on
appeal, or (b) the expiration of the time from which an appeal, review or reargument of the Order
and Final Judgment (or reargument, further appeal or other review of any order or mandate of an
appellate court affirming the Order and Final Judgment) may be sought without any such appeal,
review or reargument having been sought.
14.
In the event that the Settlement Agreement fails for any reason to become
effective in accordance with its terms, the Settlement Agreement shall have no further force and
effect and shall not be deemed to prejudice in any way the respective positions of any or all of
the Defendants or the Plaintiff in the Action, and neither the existence of this Settlement
Agreement, nor its contents or negotiations, shall be admissible in evidence or shall be referred
to for any purpose in any or all of the Action or in any other litigation or proceeding and any
judgment or order entered by the Court in accordance with the terms of the Settlement
Agreement shall be treated as vacated nunc pro tune. Moreover, in such event, no Party shall be
entitled to recover any costs or expenses incurred in connection with this Settlement Agreement,
ATTORNEYS' FEES AND EXPENSES
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15.
After negotiating the substantive terms of the Settlement, the Parties negotiated an
amount of attorneys' fees and expenses that, subject to the terms and conditions of this
Stipulation and approval by the Court, will be paid to Plaintiff's Counsel. The Defendants
acknowledge that the Plaintiff's Counsel are entitled to a reasonable and appropriate award of
attorneys' fees and reimbursement of expenses for the benefits achieved in the Settlement.
Subject to the Court's approval, the Defendants have agreed not to object to an award of
attorneys' fees and expenses to the Plaintiff's' Counsel in an amount not exceeding $340,000.00
(the "Fee Amount"). The Plaintiff and the Plaintiff's Counsel may petition the Court for an
award of attorneys' fees and expenses in that amount, which petition shall be the sole fee
application of any kind to be made in the Action by the Plaintiff and its counsel (the "Fee
Application"). The Defendants will not oppose such an application for fees and expenses in or
below such amount. It is expressly understood and agreed by the Plaintiff and its counsel that
none of the Defendant Releasees, other than Alterra (or its successor, insurers or reinsurers),
shall pay or cause to be paid or be obligated to pay all or any part of such fees and expenses.
Subject to the terms and conditions of this Settlement Agreement and any order of the Court, if
the Court awards attorneys' fees and expenses in an amount greater than $340,000.00 Alterra (or
its successor, or any of its insurers or reinsurers) shall not be obligated to pay any more than
$340,000.00. Upon dismissal of the Action, Alterra (or its successor, insurers or reinsurers) shall
pay or cause to be paid fees and expenses in the amount awarded (but not more than
$340,000.00) within ten (10) business days after notice of entry of the Court's order approving
the Settlement. The Fee Amount shall be transferred to O'Bell, LLC as custodian for all of
Plaintiffs Counsel within ten business days after the entry of the Court's entry of Judgment or a
judgment substantially in the form of Exhibit D, notwithstanding any objection thereto or
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potential appeal therefonn. Co-Lead Counsel shall be solely responsible for distribution of
Plaintiff's attorneys' fees and expenses. Plaintiff's Counsel shall be jointly and severally liable
to refund or repay any amounts paid by Alterra, or on behalf of Alterra, or its successor, insurers
and/or reinsurers if, for any reason, the fee and expenses award is overturned or reduced. None
of the Defendant Releasees shall have ny responsibility for, or liability with respect to, the fee
and expense allocation among the Plaintiff's Counsel and/or any other Person who may assert
any claim thereto, or for any amount of an award to the Plaintiff's Counsel in excess of
$340,000.00.
16.
Any order or proceedings relating to the Fee Application, or any appeal from any
order relating thereto or reversal or modification thereof, shall not operate to terminate or cancel
this Settlement Agreement, and shall not affect or delay the finality of the Order and Final
Judgment. In the event that a Settlement Class Member objects to the amount of fees to be
awarded, the Parties agree that the Court may enter the Order and Final Judgment but reserve for
subsequent determination, on a schedule to be set by the Court, the amount of the fee award.
17.
Except as provided in paragraphs 10(e), 11 and 15, the Defendants shall bear no
expense, cost, damage or fee alleged or incurred by the Plaintiff, any Settlement Class Member,
or any of their respective attorneys, experts, advisors, agents, representatives or the like.
MISCELLANEOUS
18.
All of the Exhibits and the WHEREAS clauses shall be incorporated by reference
into the Settlement Agreement as though fully set forth herein.
19.
This Settlement Agreement, or any of its provisions, only may be amended,
modified or waived by a written instrument signed by counsel for all Parties or their respective
successors.
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at, No. 13-cv-0933 (S.D.N.Y.)
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20.
This Settlement Agreement, including the Exhibits, shall be binding upon the
Parties and the Settlement Class Members and inure to the benefit of each and all of the Plaintiff
Releasees and each and all of the Defendant Releasees, provided, however, that no assignment
by any Party or Settlement Class Member shall operate to relieve such Party or Settlement Class
Member of her, his or its obligations under this Settlement Agreement.
21.
The Parties represent and agree that the terms of the Settlement were negotiated at
arm's length and in good faith by the Parties, and reflect a settlement that was reached
voluntarily based upon adequate information and sufficient discovery and after consultation with
experienced legal counsel.
22.
The Plaintiff and its counsel represent and warrant that the Plaintiff was a
shareholder of Alterra at the time the Transaction was announced, that the Plaintiff will provide
proof of ownership upon request and that none of the Plaintiff's claims or causes of action
referred to in any complaint in the Action or in the MOU has been assigned, encumbered or in
any manner transferred in whole or in part.
23.
If any claim which is or would be subject to the release and dismissal
contemplated by the Settlement Agreement is asserted against any Person in any court or other
forum prior to final approval of the Settlement, the Plaintiff shall join, at the request of any of the
Defendants, in any motion to dismiss or stay such proceeding.
24.
The Settlement Agreement, including all of the Exhibits, constitutes the entire
agreement by, between and among the Parties with respect to its subject matter, and supersedes
any and all prior agreements or understandings concerning the subject matter hereof, whether
written or oral,
25.
Any failure by any Party to insist upon the strict performance by any other Party
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or Settlement Class Member of any of the provisions of the Settlement Agreement shall not be
deemed a waiver of any of the provisions, and such Party, notwithstanding such failure, shall
have the right thereafter to insist upon the strict performance of any and all of the provisions of
the Settlement Agreement to be performed by such other Party or Settlement Class Member.
26.
The Settlement Agreement may be executed, by original, email or facsimile
signature, in counterparts, all of which shall be considered one and the same agreement and shall
become effective when such counterparts have been signed by each of the Parties and delivered
to the other Parties.
27.
The Settlement Agreement shall be construed and enforced in accordance with the
laws of the State of New York, without regard to any principles of conflict of laws. Each of the
Parties and Settlement Class Members (a) irrevocably submits to the personal jurisdiction of the
Court and any federal court sitting in or having jurisdiction over the County of New York, State
of New York, as well as to the jurisdiction of all courts to which an appeal may be taken from
such courts, in any suit, action or proceeding arising out of or relating to the MOU, the
Settlement and/or the Settlement Agreement and (b) agrees that all claims in respect of such suit,
action or proceeding shall be brought, heard and determined exclusively in the Court (provided
that, in the event that subject matter jurisdiction is unavailable in the Court because the claim(s)
are subject to exclusive jurisdiction in federal district courts, then all such claims shall be
brought, heard and determined exclusively in the United States District Court for the Southern
District of New York). Each of the Parties and Settlement Class Members waives any defense of
inconvenient forum to the maintenance of any action or proceeding brought in accordance with
this paragraph. Each of the Parties and Settlement Class Members further agrees to waive any
bond, surety or other security that might be required of any other party with respect to such any
22
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al., No. 13-cv-0933 (S.D.N.Y.)
Execution Copy
action or proceeding, including an appeal thereof.
28.
Neither the MOU nor this Settlement Agreement, nor the fact or any terms of the
Settlement, is evidence, or a presumption, admission or concession by any Party in the Action or
any other action or proceeding, any signatory hereto or any Plaintiff Releasee or any Defendant
Releasee, of any fault, liability or wrongdoing whatsoever, or lack of any fault, liability or
wrongdoing, as to any facts or claims alleged or asserted in the Action, or any other action or
proceeding. Neither the MOU nor this Settlement Agreement is a finding or evidence of the
validity or invalidity of any claim or defense in the Action or any other action or proceeding, or
any wrongdoing by any of the Defendants or any of the Defendant Releasees or any damage or
injury to any Settlement Class Member. Neither the MOU nor this Settlement Agreement, nor
any of the terms and provisions of the MOU or this Settlement Agreement, nor any of the
negotiations or proceedings in connection therewith, nor any of the documents or statements
referred to herein or therein, nor the Settlement, nor the fact of the Settlement, nor the settlement
proceedings, nor any statements in connection therewith, (a) shall (i) be argued to be, used or
construed as, offered or received in evidence as, or otherwise constitute an admission,
concession, presumption, proof, evidence or a finding of any liability, fault, wrongdoing, injury
or damage, or of any wrongful conduct, act or omission on the part of any of the Defendant
Releasces, or of any infirmity of any defense, or of any damage to any Plaintiff or Settlement
Class Member, or (ii) otherwise be used to create or give rise to any inference or presumption
against any of the Defendant Releasees concerning any fact alleged or that could have been
alleged, or any claim asserted or that could have been asserted in the Action, or of any purported
liability, fault or wrongdoing of any of the Defendant Releasees or of any injury or damages to
any Person, or (b) shall otherwise be admissible, referred to or used in any proceeding of any
23
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nature, for any purpose whatsoever; provided, however, that (x) the Settlement Agreement
and/or Order and Final Judgment may be introduced in any proceeding, whether in the Court or
otherwise, as may be necessary to argue that the Settlement Agreement and/or Order and Final
Judgment has res judicata, collateral estoppel or other issue or claim preclusion effect or to
otherwise consummate or enforce the Settlement Agreement and/or Order and Final Judgment,
and (y) the Plaintiff and its counsel may refer to the final, executed version only of the MOU or
this Settlement Agreement in connection with the Fee Application (in addition to any other
documents or information they may utilize with respect to such Fee Application).
29.
In the event of any dispute or disagreement with respect to the meaning, effect or
interpretation of the Settlement Agreement or an Exhibit, or in the event of a claimed breach of
the Settlement Agreement or an Exhibit, such dispute shall be adjudicated only in the Court,
which shall retain jurisdiction for purposes, among other things, of administering the Settlement
and resolving any disputes under the Settlement Agreement.
30.
I
Each of the Parties and their respective attorneys shall cooperate fully with one
nother in seeking the Court's approval of the Settlement Agreement and the Settlement, and use
their best efforts to cause the entry of the Order and Final Judgment and to effect, as promptly as
practicable, the consunimation of this Settlement Agreement, the Settlement and the dismissal of
the Action, including any and all complaints filed in any of the Individual Actions, with
prejudice and without costs to any Party, except as provided in paragraphs 10(e), 11 and 15
above.
31.
Without further order of the Court, the Parties may agree in writing to reasonable
extensions of time to carry out any of the provisions of this Settlement Agreement,
32,
The Settlement Agreement, together with all Exhibits, shall be deemed to have
24
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Execution Copy
been mutually prepared by the Parties and shall not be construed against any of them by reason
of authorship.
33.
Each of the attorneys executing the Settlement Agreement on behalf of one or
more of the Parties warrants and represents that she or he has been duly authorized and
empowered to execute the Settlement Agreement on behalf of each such Party.
25
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Louisiana Municipal Police Employees Retirement System v. A/terra Capital Holdings Limited ci
at., No. 13-cv-0933 (S.D.N.Y)
Execution Copy
Dated: June 20, 2013
BRANN20
F 17
1RUIC
O'
By
Paul M. Brannon
3500 North 1-lullen Street
Metairie, LA 70002
Telephone: (504) 456-8696
Facsimile: (504) 456-8697
pmb@bratitionlawfirin.com
Attorneys for Plaintiff
ll
Norl
35 V
len Street
Metairie, LA 70002
Telephone: (504) 456-8677
Facsimile: (504) 456-8653
ericg1-1w1egal .com
Attorneys for Plaintiff
GLANCY BINKOW & GOLDBERG LLP
J)EBEVOISE & PLIMPTON LU
By:____
Brian P. Murray
Gregory B. Linkh
77 Water Street, Suite 721
New York, NY 10005
Telephone: (646) 722-4180
Facsimile: (310) 201-9160
bmurrayglancyIaw.com
glinkhmurrayfrank.com
Attorneys ,fbr Plaintiff
By:_______
Macye O'Connor, Esq.
919 Third Avenue
New York, NY 10022
Telephone: (212) 909-6315
Facsimile: (212) 872-1002
mloconnor@debevoise.com
A itorneys for Defendants Markel Corporation
and commonwealth Merger Subsidiary
Limited
AKIN CUM.P STRAU S HAUER & FE LALLP
By:
RobeitU es,Lsq
One Bryant .Park
New York, NY 10036
Telephone: (212) 872-1070
Facsimile: (212) 872-1002
rpeesakingurnp.com
Attorneys for Defendants Alterra Capital Holdings
Limited, W Marston Becker, Michael O'Reilly, James D.
Carey, .Ikieyl D. Hartzband, Willis T King, Jr., James L.
Zech, Mario P. Thrsiello, K Bruce Connell, James H.
Macnaughton, W Thomas Forrester, Stephan F.
Newhouse and Andrew H Rush
26
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Case 1:13-cv-00933-ALC-HBP Document 29 Filed 06/26/13 Page 30 of 60
Louisiana Junicipai Police Employees Retire merit Syrlem i 4/terra Capital Holdings Limited ci
al., No. I 3-cv-0933 (S.D.N.Y,)
!Lecufion Copy
Dated: June 20, 2013
BRANNON LAW FIRM, LLC
O'BELL, LLC
By:
By:
Paul M. Brannon
3500 North I Jullen Street
Metaiiie, LA 70002
I'eiephonc: (504) 456-8696
Facsimile: (504) 456-8697
pmbbrannonlawfirni.com
A norneys fbr Plaintiff
Eric J. O'BeIl
3500 North ilullen Street
Metairie, LA 70002
Telephone: (504) 456-8677
Facsimile: (504) 456-8653
ericghwlegaI.com
Attorneys/or Plaint i/f
GL.ANiNKOiJi9ERC LLP
DflIE'O1SE & PJ+\1!T()N LLP
rray
Brian P.
Gregory B. Linkh
77 Water Street, Suite 721
New York, NY 10005
Telephone: (646) 722-4180
Facsimile: (310) 201-9160
hmurrayrglancykiw.com
glinkh(dJnurrayfrank.com
:4ttornej,rfbr Piceintiji
Macye O'Connor, L.
919 Third Avenue
New York, NY 10022
Telephone: (212) 909-6313
Facsimile: (212) 872-1002
m1oconnor@dehcvoise.com
Attorncysfi..'r Defendants i1'Iarkei (ioiporaIion
and Commonwealth Merger Su/,sidiwy
Limited
AKIN GUMP STEUSS HAUFR & 11I,1), LLP.
B)
Lsq.
Robert 1.1
One Bryant Park
New York, NY 10036
Telephone: (212) 872-1070
Facsimile: (212) 872-1002
rpeesakingump.com
A twrne ys Thr De/endonl.c A/terra Capital Holdings
LimIted, 14< Marston Becker, Michael O'Reilly, .Janes D.
Carey, it'Ieryl f) Harizband, Willis 71 King Jr., James L.
Zec'h, Mario P. Torsieiio, K. Bruce Cannel?, Joiner H.
Macnaughion, W Thomas l'orrester, Stephan F.
Newhouse anclAndrew Ii Rush
26
06 v2
Case 1:13-cv-00933-ALC-HBP Document 29 Filed 06/26/13 Page 31 of 60
Exhibit A
Case 1:13-cv-00933-ALC-HBP Document 29 Filed 06/26/13 Page 32 of 60
onne
N ER
13-Feb-2013 13:11 EST
486075 I4ACOV 1
HTMESS OC
Page 1 of 1
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, DC 20549
SCHEDULE 14A
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES EXCHANGE ACT OF 1934
Filed by the Registrant LJ
Filed by a Party other than the Registrant D
Check the appropriate box:
U Preliminary Proxy Statement
U Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2))
U Definitive Proxy Statement
MR Definitive
U
Additional Materials
Soliciting Material Pursuant to § 240.14a-12
ALTERRA CAPITAL HOLDINGS LIMITED
(Name of Registrant as Specified in Its Charter)
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
151 No fee required.
0 Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
U
U
(1)
Title of each class of securities to which transaction applies:
(2)
Aggregate number of securities to which transaction applies:
(3)
Per unit price or other underlying value of transaction computed pursuant to Exchange Act Rule 0-11 (Set forth the amount on
which the filing fee is calculated and State how it was determined):
(4)
Proposed maximum aggregate value of transaction:
(5)
Total fee paid:
Fee paid previously with preliminary materials.
Check box if any part of the fee is offset as provided by Exchange Act Rule 0-1 l(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration statement number, or the form or schedule and the date of its filing.
(1)
Amount previously paid:
(2)
Form, schedule or registration statement no.:
(3)
Filing party:
(4)
Date filed:
1111111111111111111111
Case 1:1 3-cv-00933-ALC-HBP Docume nt 29 Filed 06/26/13 Page 33 of 60
ALTERRA CAPITAL HOLD
DEFA14A
RR Donnelley ProFile
NER trsevind
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14-Feb-201317:51 EST
DC
go
SUPPLEMENT NO.! TO DEFINITIVE JOINT PROXY STATEMENT/PROSPECTUS
The supplemental information disclosed below should be read in conjunction with the definitive joint proxy statement/prospectus
on Schedule 14A (the "definitive joint proxy statement/prospectus") filed with the Securities and Exchange Commission (the "SEC")
by Alterra Capital Holdings Limited ("Alterra" or "the Company") on January 18, 2013, relating to the special meeting of
stockholders of A/terra to be held on February 26, 2013 at 11:00 am. Atlantic time, at the A/terra House, 2 Front Street, Hamilton,
MM 1/, Bermuda.
At the special meeting, Alterra's stockholders will be asked to vote on, among other things, proposals related to the approval
and adoption of the Agreement and Plan of Merger (the 'merger agreement"), dated as of December 18, 2012, among Alterra,
Markel Corporation ("Markel") and Commonwealth Merger Subsidiary Limited, a Bermuda exempted company and a direct, wholly
owned subsidiary of Markel ("Merger Sub"), providing for Merger Sub to merge with and into A/terra, with Alterra surviving the
merger as a wholly-owned subsidiary of Markel (the "merger").
LITIGATION RELATED TO THE MERGER
Alterra stockholder Louisiana Municipal Police Employees Retirement System filed a complaint in the United States District
Court for the Southern District of New York, purportedly on behalf of itself and other stockholders of Altena, against Alterra,
Alterra's board of directors, Markel, and Merger Sub, On February 15, 2013, the defendants entered into a memorandum of
understanding with the plaintiff regarding the settlement of this action. In connection with the settlement, Alterra agreed to make
certain supplemental disclosures to its stockholders. The Company believes that the claims in this action are without merit and that no
further disclosure is required to supplement the definitive joint proxy statement/prospectus under applicable laws; however, to avoid
the risk that the action may delay or otherwise adversely affect the consummation of the merger and to minimize the expense of
defending such action, Alterra is voluntarily making the supplemental disclosures set forth below.
The memorandum of understanding contemplates that the parties will enter into a stipulation of settlement. The stipulation of
settlement will be subject to customary conditions, including court approval following notice to Alterra's stockholders. In the event
that the parties enter into a stipulation of settlement, a hearing will be scheduled at which the United States District Court for the
Southern District of New York will consider the fairness, reasonableness and adequacy of the settlement. If the settlement is finally
approved by the court, it will resolve and release all claims in all actions that were or could have been brought challenging any aspect
of the proposed merger, the merger agreement and any disclosure made in connection therewith (excluding claims for dissenters'
rights under Bermuda Law), pursuant to terms that will be disclosed to Alterra's stockholders prior to final approval of the settlement.
In addition, in connection with the settlement, the parties contemplate that plaintiffs counsel will file a petition in the United States
District Court for the Southern District of New York for an award of attorneys' fees and expenses to be paid by Alterra or its
successor. The settlement will not affect the consideration that Alterra's stockholders are entitled to receive in the merger. There can
be no assurance that the parties will enter into a stipulation of settlement, or that the court will approve any proposed settlement. In
such event, the proposed settlement as contemplated by the memorandum of understanding may be terminated.
Case 1:13-cv-00933-ALC-HBP Document 29 Filed 06/26/13 Page 34 of 60
11111111111 liii IIIIi
NER greevind
NYM
14Feb-2013 1620 EST
I 111111
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SUPPLEMENTAL DISCLOSURES
This supplemental information should be read in conjunction with the definitive joint proxy statement/prospectus, which should
be read in its entirety. Defined terms used but not defined herein have the meanings set forth in the definitive joint proxy
statement/prospectus. New text is underlined.
The Merger—Background of the Merger
The following disclosure supplements and restates the sixth full paragraph on page 40 of the definitive joint proxy
statement/prospectus.
On August 28, 2012, Mike O'Reilly, Chairman of Alterra's board of directors, and IVIr. Becker met with Messrs. Market, Whitt,
Gayner and Kirshner, at Market's offices in Richmond, Virginia, at which meeting Markel proposed a non-binding draft term sheet,
which included among other things, a proposed form of transaction, valuation, form of consideration, tax treatment of the proposed
acquisition, board representation, closing conditions and certain provisions intended to address deal certainty. The August 28 Markel
term sheet proposed that the consideration payable to holders of Alterra common shares, on a fully-diluted basis, be equal_o
approximately LOx the June 30, 2012 GAAP book value of Alterra (as estimated by Alterra, and that the form of consideration
would be 25-30% in cash and 70-75% in Markel common stock. The August 28 Market term sheet further proposed that the merger
agreement would include customary deal protection and fiduciary out provisions, including no-shop and no talk covenants with a
customary fiduciary out and a break-up fee equal to 3.0% of the aggregate merger consideration. In addition, the August 28 Markel
term sheet noted that two to three Alterra directors would be added to the Markel board of directors. Under this term sheet. the
anticipated merger agreement was contemplated to be signed by November 1, 2011
The following disclosure supplements and restates the ninth full paragraph on page 40of the definitive joint proxy
statement/prospectus.
On September 6, 2012, Alterra, with input from its financial and outside legal advisors, presented proposed changes to Markel's
non-binding term sheet, including changes to valuation and board representation. Among other provisions, the September 6 Alterra
term sheet proposed that the consideration to be paid to the holders of Alterra common shares, on a fully diluted basis, be equal to
approximately 1,2x the June 30, 2012 GAAP book value of Alterra. The September 6 Alterra term sheet indicated that a break-up fee
of up to 3.0% of the aggrerate merger consideration was subject to the review of counsel. In addition, the September 6 Alterra term
sheet proposed that four Alterra directors would be added to the Markel board of directors. This term sheet also amended the
anticipated signing date of the merger agreement to mid-October 2012.
The following disclosure supplements and restates thefifthftul paragraph an page 41 of the definitive joint proxy
statement/prospectus.
On November 13, 2012, Mr. Becker provided Mr. Markel with a further revised non-binding term sheet that reflected the
November 12, 2012, discussions and suggested an accelerated timeline should the parties agree to proceed. The November 13 Alterra
term sheet proposed that the consideration to be paid to the holders of Alterra common shares, on a fully-diluted basis, be equal to
approximately 1.1 x the estimated December 31, 2012 GAAP book value of Alterra (before taking into account any Al terra losses
from Superstorm Sandy), and contemplated that the cash paid to Alterra's shareholders would be $1 billion to $1.3 billion. The
November 13 Alterra term sheet indicated that the break-up fee equal to 3.0% of the aggregate merger consideration was still sublect
to negotiation and that three Alterra directors would be added to the Markel board of directors.
The following disclosure supplements and restates the fourth full paragraph on page 42 of the definitive joint proxy
statement/prospectus.
On December 12, 201.2, the Alterra board of directors held an informational call with Alterra's senior management, BofA
Merrill Lynch and Akin Gump. Mr. Becker provided an update on recent discussions and an overview of the revised term sheet. BofA
Merrill Lynch provided the Alterra board of directors with certain financial analysis. The December 12 Alterra term sheet øroposed
that the consideration to be paid to the holders of Alterra common shares, on a fully-diluted basis, be equal to approximately 1. lx the
estimated December 31, 2012 OAAP book value of Alterra (after taking into account Alterra' a estimated net losses from Superstorm
Sandy), and contemplated that the cash paid to Alterra's shareholders would be 1 billion, The November 13 Alterra term sheet
accepted the 3.0% break-up fee equal, and indicated two Alterra directors would be added to the Markel board of directors.
The Merger—Opinion of Merrill Lynch, Pierce, Fenner & Smith Incorporated, Financial Advisor to Alterra—Atterra
Financial Analyses
The following disclosure amends and restates the disclosure under the heading "The Merger—Opinion of Merrill Lynch, Pierce,
Fenner & Smith Incorporated, Financial Advisor to Alterra-Alterra Financial Analyses" beginning on page 60 of the definitive joint
proxy statement/prospectus.
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Alterra Financkd Analyses
Selected Publicly Traded Companies Analysis, BofA Merrill Lynch reviewed publicly available financial and stock market
information for Alterra and the following nine publicly traded companies:
• Allied World Assurance Company Holdings, AG;
• Arch Capital Group Ltd.;
• Aspen Insurance Holdings Limited;
• Axis Capital Holdings Limited;
• Endurance Specialty Holdings Ltd.;
• Everest Re Group, Ltd.;
• PartnerRe Ltd.;
• Platinum Underwriters Holdings, Ltd.; and
• XL Group plc.
BofA Merrill Lynch reviewed, among other things, earnings per share multiples, based on closing stock prices on December 14,
2012, of the selected publicly traded companies divided by calendar year 2012 and calendar year 2013 estimated fully diluted EPS.
BofA Merrill Lynch also reviewed primary book value per share multiples, based on closing stock prices on December 14, 2012
divided by December 31, 2012 estimated primary book value per share. The results of these analyses are summarized in the table
below:
Price/2012B
Fully
Diluted
FPS
Price/2013E
FullyDiluted
- El l'S
Price/Primary
Book Value
per Share
Allied World Assnrance ComDany Holdings, A
I Lox
1L4
Arch Capital Group Ltd. 15 7x 14 Rx 1 17x
Aspen Insurance Holdings Limited
1L11\
Axis Capital Holdines Limited 9.9x ).)x
Endurance Specially Holdings Ltd.
).lx
U 71x
14_x
Everest Re Group, Ltd.
2L2
ParinerRe Ltd
2J
Platinum Underwriters Holdings 1A 1
9 9X
11 4x
LLlx
.
.
.
.
XL Group We
.
.
15.3x
lOh
Based upon the multiples of the selected companies above, and BofA Merrill Lynch's professional judgment and experience.
BofA Merrill Lynch then applied calendar year 2013 EPS multiples of 9.Ox to 11 .Ox derived from the selected publicly traded
companies to Alterra's calendar year 2013 estimated fully diluted EPS based on both AltelTa's management estimates and research
analyst estimates and applied December 31, 2012 book value multiples of 0,75x to 0.85x derived from the selected publicly traded
companies to Alterra's December 31, 2012 estimated primary book value per share. BofA Merrill Lynch also reviewed trading
multiples of Alterra common shares, based on the closing stock price of Alterra common shares on December 14, 2012 compared to
calendar year 2013 estimated fully diluted EPS based on both Altena's management estimates and research analyst estimates and
compared to December 31, 2012 estimated fully diluted book value per share based on Alterra's management estimates. The indicated
trading multiples were 8.5x 2013 estimated fully diluted EPS based on Alterra's management estimates, l0,Ox 2013 estimated fully
diluted EPS based on research analyst estimates and 0.77x December 31, 2012 estimated fully diluted book value based on Alterra's
management estimates, Estimated financial data of the selected publicly traded companies were based on publicly available research
analysts' estimates, and estimated financial data of Al terra were based on the Alterra management forecasts and publicly available
research analysts' estimates. This analysis indicated the following approximate implied per share equity value reference ranges for
Alterra, as compared to the implied merger consideration:
2013E EL'S (Alterra Estimates)
$23.84 - $29.14
Implied Per Share Equity Value Reference Ranges for Alterra
2013E EPS
12/31/2012E Book Value (Alterra
(Research Analyst Estimates)
Estimates)
$20.34- $24.86
$22.50 - $25.50
Implied Merger Consideration
$30.97
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No company used in this analysis is identical or directly comparable to Alterra, Accordingly, an evaluation of the results of this
analysis is not entirely mathematical. Rather, this analysis involves complex considerations and judgments concerning differences in
financial and operating characteristics and other factors that could affect the public trading or other values of the companies to which
Alterra was compared.
Selected Precedent Transactions Analysis. BofA Merrill Lynch reviewed, to the extent publicly available, financial information
relating to seven selected transactions in the insurance and reinsurance sectors. BofA Merrill Lynch selected these transactions based
on its professional judgment and experience, considering factors such as the financial and operating characteristics of each compapy.
No company or transaction was, however, identical to Alterra or the merger.
BofA Merrill Lynch reviewed transaction values, calculated as the equity value implied for the target company in the selected
transaction, as a multiple of the target company's one-year forward fully diluted EPS and as a multiple of the target company's fully
diluted book value for the most recent quarter ending before the date on which the transaction was announced. The results of these
analyses are summarized in the table below:
Announcement
Date
8/30/12
11/20/il
3/3/10
9/8/09
7/9/09
7/4/09
11/18/05
Acguiior
Target
• Validus Holdings, Ltd.
• Allegheny Corporation
• Max Capital Group Ltd.
• Fairfax Financial Holdings Limited
• Validus Holdings, Ltd.
• ParteerRe Ltd.
• Swiss Re
• Flagstone Reinsurance Holdings. S.A.
• Transatlantic Holdings Inc.
• Harbor Point Limited
• OdvssevRe
• IPC Holdings. Ltd.
• Paris RE Holdings Limited
• GB Insurance Solutions
Prieef
Forward
Earnings
Price /
Fully.
Diluted
Book Value
1S.5x
0,72x
NA
16.7x
7.1 x
lO.2x
NA
0.80x
1.25x
0.84X
0.97x
0.76x
Based on the multiples of the selected companies and BofA Merrill Lynch's professional judgment and experience, BofA
Merrill Lynch then applied one-year forward BPS multiples of 9.Ox to 11 Ox derived from the selected transactions to Alterra's
calendar year 2013 estimated fully diluted EPS based on both Alterra' s management estimates and research analyst estimates and
applied book value multiples of 0.80x to 0.95x derived from the selected transactions to Alterra's December 31, 2012 estimated fully
diluted book value per share. Estimated financial data of the selected transactions were based on publicly available information at the
time of announcement of the relevant transaction, Estimated financial data of Alterra were based on the Alterra management forecasts
and publicly available research analysts' estimates. This analysis indicated the following approximate implied per share equity value
reference ranges for Alterra, as compared to the implied merger consideration:
Implied Per Share Equity Value Reference Ranges for Aiterra
2013E EPS
2I31120I2E Book Value (Alterrn
(Re s earch , Analyst Estimates)
Estimates)
2013E EPS
(Alterra Estimates)
$23.84-$29.14
$20.34-$24.86
Implied Merger Consideration
$23.41 -$27.80
$30.97
No company, business or transaction used in this analysis is identical or directly comparable to Alterra or the merger.
Accordingly, an evaluation of the results of this analysis is not entirely mathematical. Rather, this analysis involves complex
considerations and judgments concerning differences in financial and operating characteristics and other factors that could affect the
acquisition or other values of the companies, business segments or transactions to which Alterra and the merger were compared.
Discounted Cash Flow Analysis. BofA Merrill Lynch performed a discounted cash flow analysis of Alterra to calculate the
estimated present value of the standalone levered, after-tax free cash flows that Alterra was forecasted to generate during Alterra's
fiscal years 2013 through 201.7 based on the Alterra management forecasts. "Levered, after-tax free cash flows" is defined for this
purpose as the portion of cash flows after the impact of interest expense and taxes that can be distributed to shareholders during
Alterra's fiscal years 2013 through 2017 based on the Alterra management forecasts. BofA Merrill Lynch calculated terminal values
for Alterra by applying terminal multiples of 0.80x to 1.00x to Alterra's December 31, 2017 estimated book value. For purposes of its
discounted cash flow analysis. BofA Merrill Lynch included the impact of the issuance of shares related to annual expected stockbased compensation expense. The cash flows and terminal values were then discounted to present value as of December 31, 2012
using discount rates ranging from 8% to 10%, which were based on an estimate of Alterra's cost of equity. This analysis indicated the
following approximate implied per share equity value reference range for Alterra as compared to the implied merger consideration:
Implied Per Share Equity Value
Reference Range ror Alterra
Implied Merger Consideration
$24.17 - $29.49
$30.97
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M'arke! Financial Analyses
Selected Publicly Traded Companies Analysis, BofA Merrill Lynch reviewed publicly available financial and stock market
information for Markel and the following eight publicly traded companies:
• ACE Limited;
• Allied World Assurance Company Holdings, AG;
• Arch Capital Group Ltd.;
• Axis Capital Holdings Limited;
• HCC Insurance Holdings., Inc.;
• RLICorp.;
• The Navigators Group, Inc.; and
• W. R. Berkley Corporation.
BofA Merrill Lynch reviewed, among other things, earnings per share multiples, based on closing stock prices on December 14,
2012, of the selected publicly traded companies divided by calendar year 2012 and calendar year 2013 estimated fully diluted BPS,
BofA Merrill Lynch also reviewed book value per share multiples based on closing stock prices on December 14, 2012 divided by
December 31, 2012 estimated primary book value per share.
The results of these analyses are summarized in the table below:
Price/2012E
Fully-Diluted
EPS
ACE LimiLed
Allied World Assurance Company _Holdings, Q
Arch__Capital__Group:Ltd. -.
Axis CapitalHoldingsLimited
HCCInsurance_Holdings,Inc
RU_ Corp.
The Naviators__Group,_Inc.
W.R, Berkley _Corporation
11.Ox
17x
Pricei2013E
Fully-Diluted
El PS
Price/Primary
Book Value
per Share
9,9x
lL4x
0.9Rx
0.81x
x
j4.
9.2x
0.77X
177x
153x
149x
j_x
13.5x
1.20x
Baseduponthemultiplesof theselected companies above, and l3ofA Merrill Lynch's professional Judgment and experience,
BofA Merrill Lynch then applied calendar year 2013 BPS multiples of 1 l.Ox to 15.Ox derived from the selected publicly traded
companies to Markel's calendar year 2013 estimated fully diluted BPS based on both Markel's management estimates and research
analyst estimates and applied December 31, 2012 book value multiples of 1. lOx to 1,40x derived from the selected publicly traded
companies to Markel's December 31, 2012 estimated primary book value per share. BofA Merrill Lynch also reviewed trading
multiples of Markel common shares, based on the closing stock price of Markel common shares on December 14, 2012 compared to
calendar year 2013 estimated fully diluted BPS based on both Markel's management estimates and research analyst estimates and
compared to December 31, 2012 estimated fully diluted book value per share. The indicated trading multiples were 20.Ox 2013
estimated fully diluted BPS based on Markel's management estimates, 23.8x 2013 estimated fully diluted EPS based on research
analyst estimates and 1.23x December 31, 2012 estimated fully diluted book value based on Markel's management estimates.
Estimated financial data of the selected publicly traded companies were based on publicly available research analysts' estimates, and
estimated financial data of Markel were based on the Markel management forecasts and publicly available research analysts'
estimates. This analysis indicated the following approximate implied per share equity value reference ranges for Markel, as compared
to the closing price of Markel common shares on December 14,2012:
2013E EPS
(Markel Estimates)
$267.30- $364.50
Implied Per Share Equity Value Reference Ranges for Markel
2013E EPS
12/3112012E Book Value (Markel
(Research Analyst Estimates)
Estimates)
$224.18- $305.70
$436.31 - $555.31
Closing Trading Price of
Markel Cüuuuoji Stock on
December 14,2012
$486.00
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No company used in this analysis is identical or directly comparable to Markel, Accordingly, an evaluation of the results of this
analysis is not entirely mathematical. Rather, this analysis involves complex considerations and judgments concerning differences in
financial and operating characteristics and other factors that could affect the public trading or other values of the companies to which
Markel was compared.
Discounted Cash Flow Analysis. BofA Merrill Lynch performed a discounted cash flow analysis of Markel to calculate the
estimated present value of the standalone levered, after-tax free cash flows that Markel was forecasted to generate during Markel's
fiscal years 2013 through 2017 based on the Markel management forecasts and such forecasts as adjusted for certain changes made by
Alterra's management to the assumptions provided by Markel's management. "Levered, after-tax free cash flows" is defined for this
purpose as the portion of cash flows after the impact of interest expense and taxes that can be distributed to shareholders du rin
Markel's fiscal years 2013 through 2017 based on the Markel management forecasts and such forecasts as adjusted for certain
chances made by Alterra's manacement to the assumptions provided by Market's management. These changes include an increase in
the assumed annual appreciation on Markel's equity portfolio. BofA Merrill Lynch calculated terminal values for Markel by applying
terminal multiples of 1.10 to 1.30 to Markel's December 31, 2017 estimated book value. For purposes of its discounted cash flow
analysis, BofA Merrill Lynch included the impact of the issuance of shares related to annual expected stock-based compensation
expense. The cash flows and terminal values were then discounted to present value as of December 31, 2012 using discount rates
ranging from 6.5% to 8.5%, which were based on an estimate of Markel' s cost of equity. This analysis indicated the following
approximate implied per share equity value reference ranges for Markel as compared to the closing price of Markel common shares
on December 14, 2012:
Implied Per Share Equity Value
Reference Range for Markel
(Markel Forecasts)
Implied Per Share Equity Value
Reference Range for Markel
(Adjusted Markel Forecasts)
Closing Trading Price of Markel Common Stock
on December 14,2012
$408.71 -$530.06
$437.66 - $567.61
$486.00
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PROJECTED FINANCIAL INFORMATION
The following disclosure supplements the definitive joint proxy statement/prospectus.
Certain financial projections prepared by, or as directed by, Markel ' s management and Alterra' s management were considered
by Alterra's board of directors in connection with its approval of, and entry into, the merger agreement. Those financial projections,
which we refer to as the 'financial projections," reflect numerous judgments, estimates and assumptions with respect to industry
performance, general business, economic, regulatory, market and financial conditions and other future events, as well as matters
specific to Markel' s and Alterra' s businesses, all of which are difficult to predict and many of which are beyond the control of Markel
or Alterra. The financial projections are subjective in many respects and are susceptible to multiple interpretations and periodic
revisions based on actual experience and business developments. As such, the financial projections constitute forward-looking
information and are subject to risks and uncertainties that could cause actual results to differ materially from the results forecasted in
such projections, including the various risks set forth in Markel's and Alterra's respective periodic reports and in the "Risk Factors"
section of this joint proxy statement/prospectus. See also "Forward-Looking Statements." There can be no assurance that the
projected results will be realized or that actual results will not be significantly higher or lower than projected. The financial
projections cannot be considered a reliable predictor of future results and should not be relied upon as such. The financial projections
cover multiple years and such information by its nature becomes less reliable with each successive year.
The financial projections do not take into account any circumstances or events occurring after the date they were prepared,
including the announcement of the proposed merger. The financial projections do not take into account the effect of any failure to
occur of the proposed merger and should not be viewed as accurate or continuing in that context. See "Risk Factors—Risks Related to
the merger—Failure to complete the merger or the fact that the merger is pending could negatively impact the share price of Market
and Alterra and the future business andfinancial results of Market and Alterra,"
The financial projections were prepared solely for use in connection with assisting in the evaluation of the potential merger and
not with a view toward public disclosure or toward complying with generally accepted accounting principles, the published guidelines
of the SEC regarding financial projections or the guidelines established by the American Institute of Certified Public Accountants for
preparation and presentation of prospective financial information. Neither Markel' s or Alterra' s independent registered public
accounting firm, nor any other independent accountants, have compiled, examined or performed any procedures with respect to the
financial projections included below, nor have they expressed any opinion or any other form of assurance on such information or its
achievability, and they assume no responsibility for, and disclaim any association with, the financial projections.
The inclusion of the financial projections in this supplemental disclosure is not deemed an admission or representation by
Alterra that they are viewed by Alterra as material information of Markel or Alterra or of Markel following the merger. These
financial projections are not included in this supplemental disclosure in order to induce any holder of Alterra common shares to vote
to approve and adopt the merger agreement and the merger. Neither Markel nor Alterra intends to update or otherwise revise these
financial projections to reflect circumstances existing since their preparation, to reflect the occurrence of unanticipated events even in
the event that any or all of the underlying assumptions are shown to be in error, or to reflect changes in general economic or industry
conditions,
In addition, the Markel financial projections were further adjusted by Alterra's management. These adjustments included an
increase in the assumed annual appreciation on Markel' s equity portfolio.
oc
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Projections Reviewed, Subject to the foregoing qualifications, among other items, the net premiums written, total revenues, net
operating income and total combined ratio reflected below by fiscal year through the year 2017 for Markel (as adjusted by Alterra' s
management) and Alterra were reviewed by Altena's board of directors.
Certain Projected Financial Information for Market. In addition to the foregoing qualifications, the following Markel financial
projections (as adjusted by Alterra' s management) include certain judgments by management in how they expect to operate the
business. These projections are for illustration purposes and should not be considered an indication of what Markel may do in the
future.
Fiscal year ending December 31:
Net premiums written
Total revenues
Netoperatinginoome
Total combined ratio
Sharerepurchases/dividends
Stockholders' equity
-
-
2013E
2014E
2015E
$2,526.0
$702.8
$2,845.7
$3,[62.7
2. 1 53
05,5 CIL
.5
0.0
$4,053. L
$3,408
$ 2807
9 5.7'i6
01)
$
$4,3318
53,690.
8 110
95.1 1k
0.0
$4,645.7
2016E
2017F.
2,999.9
$3162.5
83,010.2
$ 4 13 2.5
S
350.5
94.8%
5
0.0
$5,005.2
$ 404,
04.5%
0.0
$
$5,409.9
Certain Projected Financial information for Alterra, In addition to the foregoing qualifications, the following financial
projections developed by Alterra include certain judgments by management in how they expect to operate the business. These
projections are for illustration purposes and should not be considered an indication of what Alterra may do in the future.
Fiscal year ending December 31:
2013E
2014E
Net premiums written
51.340,0
51.17/1,5 -
Total revenues
Net operating income,
Total combined ratio
Shareepurchaos/dividend
Stockholders' equity
S 1600,1
S 22
$1705.6
$ 280.8
So 01
261.1
$2,8963
89,8'4
$ 203,5
$2,937.8
2015E
2016E
2017E
540.4
S 00.2.
$1681
S 1816.4
S 305.5
S 1897.4
S, , 326.0 ,
$1082.11
$ 344.3
90.1%
S 265.5
$3,003.2
90.2%
S 267.1
$3,088.8
911,5%
$ 208.3
$3,192.9
INFORMATION CONCERNING FORWARD-LOOKING STATEMENTS
This filing includes statements about future economic performance, finances, expectations, plans and prospects of Alterra and
Markel, both individually and on a combined basis, that are forward-looking statements for purposes of the safe harbor provisions of
the Private Securities Litigation Reform Act of 1995. There are risks and uncertainties that could cause actual results to differ
materially from those expressed in or suggested by such statements. For further information regarding factors affecting future results
of Alterra and Markel, please refer to their respective Annual Report on Form 10-K for the year ended December 31, 2011 and
Quarterly Reports on Form l0-Q and other documents filed by Alterra and Markel since March 1, 2012 with the SEC. These
documents are also available free of charge, in the case of Alterra, by directing a request to Alterra through Joe Roberts, Chief
Financial Officer, or Susan Spivak Bernstein, Senior Vice President, Investor Relations, at 441-295-8800 and, in the case of Markel,
by directing a request to Bruce Kay, Investor Relations, at 804-747-0136. Neither Alterra nor Markel undertakes any obligation to
update or revise publicly any forward-looking statement whether as a result of new information, future developments or otherwise.
Case 1:13-cv-00933-ALC-HBP Document 29 Filed 06/26/13 Page 41 of 60
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This filing contains certain forward-looking statements within the meaning of the U.S. federal securities laws. Statements that
are not historical facts, including statements about Alterra's and Markel's beliefs, plans or expectations, are forward-looking
statements. These statements are based on Alterra's or Markel's current plans, estimates and expectations. Some forward-looking
statements may be identified by use of terms such as "believe," 11 anticipate," "intend," "expect," "project," "plan," "may," "should,"
"could," "will," "estimate," "predict," "potential," "continue," and similar words, terms or statements of a future or forward-looking
nature. In light of the inherent risks and uncertainties in all forward-looking statements, the inclusion of such statements in this filing
should not be considered as a representation by Alterra, Markel or any other person that Alterra's or Markel's objectives or plans,
both individually and on a combined basis, will be achieved. A non-exclusive list of important factors that could cause actual results
to differ materially from those in such forward-looking statements includes the following: (a) the occurrence of natural or man-made
catastrophic events with a frequency or severity exceeding expectations; (b) the adequacy of loss reserves and the need to adjust such
reserves as claims develop over time; (c) the failure of any of the loss limitation methods the parties employ; (d) any adverse change
in financial ratings of either company or their subsidiaries; (e) the effect of competition on market trends and pricing; (F) cyclical
trends, including with respect to demand and pricing in the insurance and reinsurance markets; (g) changes in general economic
conditions, including changes in interest rates and/or equity values in the United States of America and elsewhere; and (h) other
factors set forth in Alterra's and Markel's recent reports on Form 10-K, Form 10-Q and other documents filed with the SEC by
Alterra and Markel,
*****
Risks and uncertainties relating to the proposed transaction include the risks that: (1) the parties will not obtain the requisite
shareholder or regulatory approvals for the transaction; (2) the anticipated benefits of the transaction will not be realized or the parties
may experience difficulties in successfully integrating the two companies; (3) the parties may not be able to retain key personnel;
(4) the conditions to the closing of the proposed merger may not be satisfied or waived; (5) the Outcome of any legal proceedings to
the extent initiated against Alterra or Markel or its respective directors and officers following the announcement of the proposed
merger is uncertain; (6) the acquisition may involve unexpected costs; and (7) the businesses may suffer as a result of uncertainty
surrounding the acquisition. These risks, as well as other risks of the combined company and its subsidiaries may be different from
what the companies expect, or have previously experienced, and each party's management may respond differently to any of the
aforementioned factors, These risks, as well as other risks associated with the merger, are more fully discussed in the joint proxy
statement/prospectus of Markel and Alterra that has been filed with the SEC. Readers are cautioned not to place undue reliance on
any forward-looking statements, which speak only as of the date on which they are made.
ADDITIONAL INFORMATION ABOUT THE PROPOSED MERGER AND WHERE TO FIND IT:
This filing relates to a proposed merger between Alterra and Markel. On December 27, 2012, Markel filed with the SEC a
registration statement on Form S-4, and on January 18, 2013, Markel and Alterra each filed the definitive joint proxy
statement/prospectus. This filing is not a substitute for the definitive joint proxy statement/prospectus or any other document that
Markel or Alterra filed or may file with the SEC or send to its shareholders in connection with the proposed merger. INVESTORS
AND SECURITY HOLDERS ARE URGED TO READ THE DEFINITIVE JOINT PROXY STATEMENT/PROSPECTUS AND
ALL OTHER RELEVANT DOCUMENTS FILED OR THAT MAY BE FILED WITH THE SEC OR SENT TO SHAREHOLDERS
AS THEY BECOME AVAILABLE BECAUSE THEY CONTAIN OR WILL CONTAIN IMPORTANT INFORMATION ABOUT
THE PROPOSED MERGER. All documents, when filed, will be available free of charge at the SEC's website (www.sec.gov ) or, in
the case of Alterra, by directing a request to Joe Roberts, Chief Financial Officer, or Susan Spivak Bernstein, Senior Vice President,
Investor Relations, at 441-295-8800 and, in the case of Markel, by directing a request to Bruce Kay, Investor Relations, at 804-7470136.
Case 1:13-cv-00933-ALC-HBP Document 29
RR Donnelley ProFile
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Filed 06/26/13 Page 42 of
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PARTICIPANTS IN THE SOLICITATION;
Alterra and Markel and their respective directors and executive officers may be deemed to be participants in any solicitation of
proxies from both Alterra' s and Markel' s shareholders in favor of the proposed transaction. Information about Alterra' s directors and
executive officers and their ownership in Alterra common stock is available in the proxy statement dated March 26, 2012 for Alterra's
2012 annual general meeting of shareholders. Information about Markel's directors and executive officers and their ownership of
Markel common stock is available in the proxy statement dated March 16, 2012 for Markel's 2012 annual meeting of shareholders,
10
Case 1:13-cv-00933-ALC-HBP Document 29 Filed 06/26/13 Page 43 of 60
Exhibit B
Case 1:13-cv-00933-ALC-HBP Document 29 Filed 06/26/13 Page 44 of 60
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
LOUISIANA MUNICIPAL POLICE
EMPLOYEES RETIREMENT SYSTEM,
Individually on Behalf of Itself and All
Others Similarly Situated,
Plaintiff:,
:
No. 13. CIV. 0933
V.
ALTERRA CAPITAL HOLDINGS
LIMITED, W. MARSTON BECKER,
MICHAEL O'REILLY, JAMES D, CAREY,
MERYL D. HARTZBAND, WILLIS T.
KING, JR., JAMES L. ZECH, MAPJO P.
TORSIELLO, K. BRUCE CONNELL,
JAMES H. MACNAUGHTON, W.
THOMAS FORRESTER, STEPHAN F.
NEWHOUSE, ANDREW H, RUSH,
MARKEL CORPORATION, and
COMMONWEALTH MERGER
SUBSIDIARY LIMITED,
Defendants.
NOTICE OF PENDENCY OF CLASS ACTION, PROPOSED SETTLEMENT OF CLASS
ACTION, SFTTLEMENT HEARING AND RIGHT TO APPEAR
TO: ALL RECORD HOLDERS AND BENEFICIAL OWNERS OF ALTERRA
CAPITAL HOLDINGS LIMITED COMMON STOCK (OTHER THAN DEFENDANTS
AND THEIR RESPECTIVE IMMEDIATE FAMILY MEMBERS, DIRECTORS,
PARTNERS, DIRECT OR INDIRECT PARENT OR SUBSIDIARY ENTITIES, AND ANY
OTHER PERSON OVER WHOM OR WHICH ANY DEFENDANT EXERCISES SOLE
OR EXCLUSIVE CONTROL) WHO HELD SUCH STOCK AT ANY TIME DURING
THE PERIOD BEGINNING ON AND INCLUDING DECEMBER 19, 2012, THROUGH
AND INCLUDING MAY 1, 2013 INCLUDING ANY AND ALL OF THEIR RESPECTIVE
SUCCESSORS-IN-INTEREST, SUCCESSORS, PREDECESSORS-IN-INTEREST,
PREDECESSORS, REPRESENTATIVES, TRUSTEES, EXECUTORS,
ADMINISTRATORS, ESTATES, HEIRS, ASSIGNS OR TRANSFEREE 5, IMMEDIATE
AND REMOTE, AND ANY PERSON ACTING FOR OR ON BEHALF OF, OR
CLAIMING UNDER, ANY OF THEM, AND EACH OF THEM, TOGETHER WITH
Case 1:13-cv-00933-ALC-HBP Document 29 Filed 06/26/13 Page 45 of 60
THEIR RESPECTIVE SUCCESSORS-IN-INTEREST, SUCCESSORS,
PREDECESSORS-IN-INTEREST, PREDECESSORS, REPRESENTATIVES,
TRUSTEES, EXECUTORS, ADMINISTRATORS, ESTATES, HEIRS, ASSIGNS AND
TRANSFEREES.
THIS NOTICE WAS SENT TO YOU BY ORDER OF THE COURT.
PLEASE READ THIS NOTICE CAREFULLY AND IN ITS ENTIRETY. THIS NOTICE
RELATES TO A PROPOSED SETTLEMENT OF THIS CLASS ACTION AND, IF YOU
ARE A CLASS MEMBER, CONTAINS IMPORTANT INFORMATION AS TO YOUR
RIGHTS CONCERNING THE SETTLEMENT DESCRIBED BELOW.
IF YOU HELD SHARES OF ALTERRA CAPITAL HOLDINGS LIMITED STOCK FOR THE
BENEFIT OF ANOTHER, PLEASE PROMPTLY TRANSMIT THIS DOCUMENT TO THE
BENEFICIAL OWNER.
This Notice is not a lawsuit against you, you are not being sued. You have received this
Notice because you may be a member of the Settlement Class described in this Notice.
L PURPOSE OF THIS NOTICE
This Notice is given to an Order of the United States District Court for the Southern
District of New York (the "Court") entered in the above-captioned action (the "Action") on
(the "Notice Order"). The purpose of this Notice is to inform you of the pendency
and proposed settlement of the Action (the "Settlement") by means of the Stipulation and
Agreement of Compromise and Settlement dated June 20, 2013 (the "Agreement") entered into
by the Parties, and the Court's conditional certification of a Settlement Class for purposes of the
Settlement, and to notify you of a hearing (the "Settlement Hearing") to be held before the
Honorable Andrew L. Carter, Jr., United States District Judge, at the United States District Court
for the Southern District of New York, 40 Foley Square, New York, NY 10007, Courtroom 1306
for the purpose of determining: (i) whether Plaintiff is an adequate representatives of the
Settlement Class, (ii) whether the Settlement is fair, reasonable, adequate and in the best interests
of the Settlement Class, (iii) whether the Order and Final Judgment should be entered, (iv) any
objections to the Settlement, (v) the Fee Application (defined in paragraph 15), and any
objections thereto, and (vi) any such other matters as the Court may deem necessary and
appropriate.
The Court has determined that for purposes of the Settlement only, the Action shall be
conditionally certified as a non-opt-out class action pursuant to Rule 23 of the Federal Rules of
Civil Procedure, on behalf of the Settlement Class. At the Settlement Hearing, the Court will
also consider whether the Settlement Class should be permanently certified as a lion-opt-out
class pursuant to Rule 23 of the Federal Rules of Civil Procedure, and whether Plaintiff and its
counsel have adequately represented the Settlement Class.
This Notice describes the rights that you may have pursuant to the Settlement and what
steps you may, but are not required to take, in relation to the Settlement.
Case 1:13-cv-00933-ALC-HBP Document 29 Filed 06/26/13 Page 46 of 60
If the Court approves the Settlement, the Parties (as defined below) will ask the Court at
the Settlement Hearing to enter an Order and Final Judgment dismissing the Action and releasing
all Settled Claims.
The Court has reserved the right to adjourn the Settlement Hearing without further notice
to the Class other than by announcement at the Settlement Hearing or any adjournment thereof.
The Court has further reserved the right to approve the Settlement at or after the Settlement
Hearing with such modifications as may be consented to by the Settling Parties and without
further Notice to the members of the Class.
IL HISTORY AND BACKGROUND OF THE SETTLEMENT
THE FOLLOWING RECITATION DOES NOT CONSTITUTE FINDINGS OF THE
COURT. IT IS BASED ON THE STATEMENTS OF THE PARTIES AND SHOULD NOT
BE UNDERSTOOD AS AN EXPRESSION OF ANY OPINION OF THE COURT AS TO
THE MERITS OF ANY OF THE CLAIMS OR DEFENSES RAISED BY ANY OF THE
PARTIES.
On December 19, 2012, Alterra Capital Holdings Limited ("Alterra" or the "Company")
and Markel Corporation ("Markel"), announced a definitive merger agreement (the "Merger
Agreement") pursuant to which each Alterra common share would be converted into the right to
receive 0.04315 Markel common shares plus a cash payment of $10 per share (the
"Transaction").
On January 18, 2013, Alterra and Markel filed with the Securities Exchange Commission
(the "SEC") a definitive proxy statement on Form DEFM14A relating to the Transaction (the
"Proxy"). The Proxy contained a discussion of the background of the Merger Agreement and
the reasons the board of directors of Alterra recommended that stockholders vote in favor of the
Transaction and sought stockholder approval for the Transaction.
On February 8, 2013 the Louisiana Municipal Police Employees Retirement System
("Plaintiff'), commenced the Action in the United States District Court for the Southern District
of New York (the "Court") as a putative class action against defendants W. Marston Hecker,
Michael O'Reilly, James D. Carey, Meryl D. Hartzband, Willis T. King, Jr., James L. Zech,
Mario P. Torsiello, K. Bruce Connell, James H. Macnaughton, W. Thomas Forrester, Stephan F.
Newhouse, Andrew H. Rush, Alterra, Markel, and Commonwealth Merger Subsidiary Limited
("Merger Sub") which has merged with and into Alterra (collectively, the "Defendants")
alleging, among other things, that the Proxy misrepresents and/or omits material information
necessary for Alterra's public shareholders to make an informed decision regarding whether to
vote in favor of the Transaction.
On February 13, 2013, Plaintiff filed a Motion for Preliminary Injunction seeking to
enjoin the shareholder vote on the Transaction based on alleged deficiencies in the Proxy.
On February 15, 2013, in response to the Plaintiff's demands for further disclosure to
Alterra's shareholders and as a result of negotiations among the Parties, Alterra included certain
additional and/or revised disclosures (the "Supplemental Disclosures"), substantially in the form
Case 1:13-cv-00933-ALC-HBP Document 29 Filed 06/26/13 Page 47 of 60
of Exhibit A, in its Definitive Proxy Statement filed with the SEC (the "Definitive Proxy").
On or as of February 15, 2013, the Parties executed a Memorandum of Understanding
("MOU"). The MOU memorialized the terms of the Parties' agreement in principle to settle the
Action.
Defendants acknowledged that the pendency of the Action and the efforts of the
Plaintiff's counsel caused their decision to include the Supplemental Disclosures in the
Definitive Proxy to Alterra's shareholders,
As further provided in the MOU, the Parties contemplated that the MOU ultimately
would be replaced by this Settlement Agreement, to be prepared by the Parties and submitted to
the Court for approval, and that this Settlement Agreement would include all of the terms of the
Settlement, including proposing the certification of a class for settlement purposes only.
Prior to negotiating and entering into the MOU, the Plaintiff's counsel received
productions of documents from Alterra which they reviewed and analyzed. The Plaintiff's
counsel reserved the right to conduct additional discovery to confirm their, and the Plaintiff's,
conclusion that the Settlement was fair, adequate, reasonable and in the best interests of the
putative class (the "Confirmatory Discovery"). The Plaintiff's counsel deemed it appropriate
and necessary to conduct Confirmatory Discovery before entering into this Settlement
Agreement. The post-MOU Confirmatory Discovery occurred and included the depositions of
W. Marston Becker, the Chief Executive Officer of Alterra, and Robert Giammarco, a
representative of Bank of American Merrill Lynch.
On February 26, 2013, shareholders of Alterra and Markel voted to approve the
Transaction.
IL!. THE PROPOSED SETTLEMENT
In consideration for the full settlement and release of all Settled Claims, Alterra agreed to
disclose and disclosed additional information (the "Supplemental Disclosures") in a Form
DEFM14A, which is attached hereto as Exhibit A (the "Supplement"), which Alterra filed with
the SEC and made available through such filing with the SEC to Alterra shareholders in
connection with seeking shareholders' vote on the Merger Agreement on or about February 15,
2013.
Defendants acknowledge that the decision to make the Supplemental Disclosures was a
direct and sole result of Plaintiff's lawsuit, Defendants' desire to settle the Action, the efforts of
Plaintiffs counsel and the negotiations between counsel for Plaintiff and counsel for Defendants.
IV.
RELEASE AND DISMISSAL OF CLAIMS - ORDER AND FINAL JUDGMENT
At the Settlement Hearing, the Parties will jointly ask the Court to enter an Order and
Final Judgment which will, among other things:
Case 1:13-cv-00933-ALC-HBP Document 29 Filed 06/26/13 Page 48 of 60
a. approve the Settlement pursuant to Rule 23(e) of the Federal Rules of
Civil Procedure;
b. authorize and direct performance of the Settlement in accordance with its
terms and conditions and reserve jurisdiction to supervise the consummation of the
Settlement;
c. certify the Settlement Class pursuant to Rule 23(c) of the Federal Rules of
Civil Procedure;
d. provide for the complete discharge, dismissal with prejudice on the merits,
settlement and release of, and an injunction barring, any and all claims, demands,
rights, actions or causes of action, liabilities, damages, losses, obligations, judgments,
suits, matters and issues of any kind or nature whatsoever, whether known or
unknown, contingent or absolute, suspected or unsuspected, disclosed or undisclosed,
that have been or could have been asserted in the Action or in any court tribunal or
proceeding, including but not limited to any claims arising under federal, state or
Bermuda law, whether such claims relate to alleged fraud, breach of any duty,
negligence or violation of securities laws, by or on behalf of the Plaintiff in the
Action, its successors and assigns, or by any and all of the members of the Class,
whether individual, class, derivative, representative, legal, equitable of any other type
or in any other capacity against any and all Defendants and each and all of their
respective past and present predecessors, successors, parent entities, subsidiaries,
affiliates, general or limited partners or partnerships, and agents (including, without
limitation, any past or present officers, directors, stockholders, members, managers,
general or limited partners, limited liability companies, agents, representatives,
assignors, employees, advisors, accountants, attorneys, financial or investment
advisors (including, without limitation, Bank of America Merrill Lynch and
Citigroup), other advisors, consultants, insurers, co-insurers, reinsurers, investment
bankers and each and all of their respective heirs, executors, administrators, trustees,
personal or legal representatives, estates, successors or assigns (collectively, the
"Released Persons") which the Plaintiff or any member of the Class ever had, now
has, or hereafter can, shall or may have by reason of, arising out of; relating to or in
connection with the allegations, facts, events, transactions, acts, occurrences,
statements, representations, misrepresentations, omissions or any other matter, thing
or cause whatsoever involved, set forth or otherwise related to the Action, the
Transaction, or the Merger Agreement, including without limitation any disclosures,
non-disclosures or public statements made in connection with any of the foregoing
(collectively, the "Settled Claims"). Notwithstanding the foregoing, the Settled
Claims do not include (1) properly perfected claims for appraisal under Bermuda law;
(2) claims by any of the parties to enforce the terms of the Settlement; or (3) any
federal securities claim any class member may have against Markel as a shareholder
of Market to the extent that such federal securities law claim is unrelated to the
Transaction, the Merger Agreement or any disclosures, non-disclosures or public
statements made in connection with the Transaction or Merger Agreement.
Case 1:13-cv-00933-ALC-HBP Document 29 Filed 06/26/13 Page 49 of 60
e. provide that the releases contemplated by the Settlement extend to claims
that Defendants and Plaintiff, for itself and on behalf of the Class, the Company and
its shareholders, do not know or suspect to exist at the time of the release, which if
known, might have affected the decision to enter into the release or to object or not to
object to the Settlement. Plaintiff, Defendants, and each member of the putative
Class shall be deemed to waive, and shall waive and relinquish to the fullest extent
permitted by law, any and all provisions, rights and benefits conferred by any law of
the United States or any state or territory of the United States, or principle of common
law, which governs or limits a person's release of unknown claims, including without
limitation rights and benefits of Section 1542 of the California Civil Code which
provides as follows:
A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE
CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS OR HER
FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF
KNOWN BY HIM OR HER MUST HAVE MATERIALLY AFFECTED HIS
OR HER SETTLEMENT WITH THE DEBTOR
Plaintiff, for itself and on behalf of the Class, the Company and its shareholders,
acknowledges that members of the Class and/or other Company shareholders may
discover facts in addition to or different from those that they now know or believe to
be true with respect to the subj ect matter of this release, but that it is its intention, as
Plaintiff and on behalf of the Class, to fully, finally and forever settle and release any
and all claims released hereby known or unknown, suspected or unsuspected, which
now exist, or heretofore existed, or may hereafter exist, and without regard to the
subsequent discovery or existence of such additional or different facts. Plaintiff
acknowledges, and the members of the Class shall be deemed by operation of the
entry of a final order and judgment approving the Settlement to have acknowledged,
that the foregoing waiver was separately bargained for and is a key element of the
Settlement of which this release is a part, without which Defendants would not agree
to the Settlement;
f. permanently bar and enjoin the institution and prosecution by Plaintiff and
any member of the Settlement Class of any other action against any Released Party in
any court asserting any Settled Claims; and
g. reserve jurisdiction overall matters relating to the administration and
effectuation of the Settlement.
V. NOTICE TO BROKERS AND OTHER NOMINEES
The Court has requested that record holders of common stock of Alterra included in the
Settlement Class promptly send this Notice to all beneficial owners of such stock or promptly
send a list of the names and addresses of such beneficial owners to the Notice Administrator at
the following address:
Case 1:13-cv-00933-ALC-HBP Document 29 Filed 06/26/13 Page 50 of 60
Alterra Capital Holdings Shareholder Litigation
Rust Consulting, Inc.
P.O. Box 3009
Faribault, MN 5502 1-2609
You may obtain reimbursement of your reasonable and actual out-of-pocket
disbursements that would not have been made but for this request by submitting an itemized
statement to the Notice Administrator at the address listed above.
VI.
PLAINTIFF'S COUNSEL'S ATTORNEYS' FEES AND EXPENSES
As part of the Settlement, Defendants agreed that, subject to Court approval and
dismissal of the Action by the Court with prejudice and on the merits, Alterra and/or its insurance
carrier shall pay to Plaintiffs' Counsel the sum of up to $340,000.00 in full settlement of their
claim for attorneys' fees and reimbursement of expenses. Defendants agree not to oppose
Plaintiffs' Counsel's request for such approval in an amount not exceeding $340,000.00, both in
the Court and on any appeal by any Class member. Plaintiffs' Counsel agree that they will not
seek Court approval of an amount greater than this sum.
VII.
THE SETTLEMENT HEARING
Any Settlement Class Member who objects to the terms of Agreement, the proposed
Settlement, the settlement class action determination, the entry of the Order and Final Judgment
approving the Settlement and/or the Fee Application, or who otherwise wishes to be heard at the
Settlement Hearing, may appear in person or by her, his or its attorney at the Settlement Hearing
and present any evidence or argument that may be proper and relevant; provided, however, that
no Person (other than the Parties) shall be heard, and no papers, briefs, pleadings or other
documents submitted by any such Person shall be received and considered by the Court (unless
the Court in its discretion otherwise shall direct, upon application of such Person and for good
cause shown), unless no later than ten (10) calendar days prior to the Settlement Hearing, that
Person has served, by hand or overnight delivery upon each of the counsel for the Parties to these
actions, to wit:
Paul M. Brannon
BRANNON LAW FIRM, LLC
3500 North 1-lullen Street
Metairie, LA 70002
Telephone: (504) 456-8696
Facsimile: (504) 456-8697
pmb@brannonlawfirm.com
Counsel for Plaintiff and the Settlement
Class
Brian P. Murray
Gregory B. Linkh
GLANCY BINKOW & GOLDBERG LLP
77 Water Street, Suite 721
New York, NY 10005
Eric J. O'Bell
O'BELL, LLC
3500 North Hullen Street
Metairie, LA 70002
Telephone: (504) 456-8677
Facsimile: (504) 456-8653
cric@ghwlegal.com
Counsel for Plaintiff and the Settlement Class
Macye O'Connor, Esq,
DEBEVOISE & PLIMPTON LLP
919 Third Avenue
New York, NY 10022
Telephone: (212) 909-6315
Case 1:13-cv-00933-ALC-HBP Document 29 Filed 06/26/13 Page 51 of 60
Telephone: (646) 722-4180
Facsimile: (310) 201-9160
bmurray@glancylaw. corn
g1inkhmurrayfran1ccom
Counsel for Plaintiff and the Settlement
Class
Robert H. Pees, Esq.
AKIN GUMP STRAUSS HAUER & FELD,
LLP
One Bryant Park
New York, NY 10036
Telephone: (212) 872-1070
Facsimile: (212) 872-1002
rpees@akingump.com
Counsel for Defendants A/terra Capital
Holdings Limited, W. Marston Becker,
Michael O'Reilly, James D. Carey, Meryl D.
Hartzband, Willis T. King, Jr., James L.
Zech, Mario P. Torsiello, K Bruce Connell,
James H. Macnaugliton, W. Thomas
Forrester, Stephan F. Newhouse and
Andrew H. Rush
Facsimile: (212) 872-1002
mloconnor@debevoise.com
Counsel for Defendants Markel Corporation
and Commonwealth Merger Subsidiary
Limited
and filed with the Clerk of the United States District Court for the Southern District of New
York, 40 Foley Square, New York, NY 10007, the following materials: (i) written notice of the
intention to appear, (ii) a detailed statement of all of such Person's objections to any matter
before the Court, including all of the grounds therefor and/or the reasons for such Person's
desiring to appear and to be heard, signed personally by such objector, (iii) documentary proof of
such Person's membership in the Settlement Class, and (iv) all documents and writings which
such Person desires the Court to consider are filed by such Person with the Court. Any
Settlement Class Member who does not make his, her or its objection in the manner provided
shall be deemed to have waived such objection and shall forever be foreclosed from making any
objection to the fairness or adequacy of the Settlement as incorporated in the Agreement unless
otherwise ordered by the Court.
IX. EXAMINATION OF PAPERS
This notice contains only a summary of the terms of the proposed Settlement. For a more
detailed statement of the matters involved in these proceedings, you may review the files at the
office of the clerk of the court during regular business hours or contact Plaintiffs' counsel at the
address listed above.
Case 1:13-cv-00933-ALC-HBP Document 29 Filed 06/26/13 Page 52 of 60
IF YOU HAVE ANY QUESTIONS, PLEASE MAKE ALL INQUIRIES TO:
Paul M. Brannon
Eric J. O'Bell
BRANNON LAW FIRM, LLC O'BELL, LLC
3500 North Hullen Street
3500 North Huilen Street
Metairie, LA 70002
Metairie, LA 70002
Telephone: (504) 456-8696
Telephone: (504) 456-8677
Facsimile: (504) 456-8697
Facsimile: (504) 456-8653
pmb@brannonlawfirm.com
eric@ghwlegal.com
Brian P. Murray
Gregory B. Linkh
GLANCY BINKOW &
GOLDBERG LLP
77 Water Street, Suite 721
New York, NY 10005
Telephone: (646) 722-4180
Facsimile: (310) 201-9160
bmurray@glancylaw.com
g1inkhmurrayfrarik.corn
PLEASE DO NOT CONTACT THE COURT DIRECTLY.
Dated:
DISTRIBUTED BY ORDER OF THE UNITED STATES DISTRICT COURT FOR THE
SOUTHERN DISTRICT OF NEW YORK
Case 1:13-cv-00933-ALC-HBP Document 29 Filed 06/26/13 Page 53 of 60
Exhibit C
Case 1:13-cv-00933-ALC-HBP Document 29 Filed 06/26/13 Page 54 of 60
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
LOUISIANA MUNICIPAL POLICE
EMPLOYEES RETIREMENT SYSTEM,
Individually on Behalf of Itself and All
Others Similarly Situated,
Plaintiff,
:
No, 13, CIV. 0933
I!,
ALTERRA CAPITAL HOLDINGS
LIMITED, W. MARSTON BECKER,
MICHAEL OtRETLLY, JAMES D. CAREY,
MERYL D. HARTZBAND, WILLIS T.
KING, JR., JAMES L. ZECH, MARIO P.
TORSIELLO, K. BRUCE CONNELL,
JAMES H. MACNAUGHTON, W.
THOMAS FORRESTER, STEPHAN F.
NEWHOUSE, ANDREW H. RUSH,
MARKEL CORPORATION, and
COMMONWEALTH MERGER
SUBSIDIARY LIMITED,
Defendants.
PRELIMINARY APPROVAL ORDER
WHEREAS, the Court has received the Stipulation and Agreement of Compromise and
Settlement dated June 20,2013 (the "Agreement") that has been entered into by and between the
Louisiana Municipal Police Employees Retirement System ("Plaintiff"), on behalf of itself as
well as members of the Settlement Class (as defined below), and defendants W. Marston Becker,
Michael O'Reilly, James D. Carey, Meryl D. Hartzband, Willis T. King, Jr., James L. Zech, Mario
P. Torsiello, K. Bruce Connell, James H. Macnaughton, W. Thomas Forrester, Stephan F.
Newhouse, Andrew 1-I, Rush, Alterra Capital Holdings Limited ("Alterra"), Markel Corporation,
and Commonwealth Merger Subsidiary Limited (collectively, the "Defendants," and collectively
with the Plaintiff, the "Parties");
WHEREAS, Plaintiff has applied to the Court for an Order, pursuant to Federal Rule of
Civil Procedure 23(e), seeking, inter alici, to preliminarily certify a class for settlement purpose
and preliminary approve the proposed settlement of the above-captioned action (the "Action"),
as embodied in the Agreement, and for dismissal of the Action against the Defendants upon the
terms and conditions set forth in the Agreement;
Case 1:13-cv-00933-ALC-HBP Document 29 Filed 06/26/13 Page 55 of 60
NOW, upon the consent of the Parties, after review and consideration of the Agreement
filed with the Court and the exhibits annexed thereto, and after due deliberation,
IT IS HEREBY ORDERED that:
1. Capitalized terms herein have the same meaning as they are given in the Agreement.
2. The Court hereby grants preliminary approval of the proposed Settlement upon the terms
and conditions set forth in the Agreement. The Court preliminarily finds that the terms of
the proposed Settlement are fair, adequate and reasonable and comply with Rule 23(e) of
the Federal Rules of Civil Procedure ('FRCP"). The Court further finds that, for
purposes of the Settlement, (a) the Settlement Class is ascertainable, (b) the members of
the Settlement Class are so numerous that joinder is impracticable, (c) there are questions
of law and fact common to the Settlement Class members which predominate over any
individual questions, (d) the representative plaintiff's claims are typical of the claims of
the Settlement Class members, (e) the Class Representatives and Class Counsel have
fairly, adequately, reasonably and competently represented and protected the interests of
the Settlement Class throughout the litigation, and (f) a class action is superior to other
available methods for the fair and efficient adjudication of the controversy.
The Court certifies, for settlement purposes only, a non-opt-out Settlement Class
consisting of all record holders and beneficial owners of Alterra common stock who held
such stock at any time during the period beginning on and including December 19, 2012,
through and including May 1, 2013 including any and all of their respective successorsin-interest, successors, predecessors-in-interest, predecessors, representatives, trustees,
executors, administrators, estates, heirs, assigns or transferees, immediate and remote,
and any Person acting for or on behalf of, or claiming under, any of them, and each of
them, together with their respective successors-in-interest, successors, predecessors-ininterest, predecessors, representatives, trustees, executors, administrators, estates, heirs,
assigns and transferees. Excluded from the Settlement Class are the Defendants and their
respective immediate family members, directors, partners, direct or indirect parent or
subsidiary entities, and any other Person over whom or which any Defendant exercises
sole or exclusive control.
4. For the purposes of this Settlement, Plaintiffis provisionally appointed as representative
of the Settlement Class ("Class Representative"), and pursuant to FRCP 23(g), O'Bell,
LLC, the Brannon Law Firm, LLC and Glancy Binkow & Goldberg LLP are
provisionally appointed as class counsel ("Class Counsel") for the Settlement Class.
5. The Court approve the form of the Notice of Pendency Of Class Action, Proposed
Settlement, Settlement Hearing And Right To Appear attached as Exhibit D to the
Agreement, and fmd that such Notice constitutes adequate notice to the Settlement Class
Members pursuant to FRCP 23(c)(2)(A).
6. Within twenty-eight days from the entry of this Order, Alterra shall mail or cause to be
mailed the Notice to all Settlement Class Members who will be bound by the provisions
of Paragraphs 6, 7 and 8 of the Agreement, and Alterra shall pay all reasonable costs and
Case 1:13-cv-00933-ALC-HBP Document 29 Filed 06/26/13 Page 56 of 60
expenses incurred in mailing such Notice.
7. A hearing (the "Settlement Hearing") shall be held no later than October 28, 2013 before
the honorable Andrew L. Carter, Jr., United States District Judge, at the United States
District Court for the Southern District of New York, 40 Foley Square, New York, NY
10007, Courtroom 1306, to consider (i) whether Plaintiff is an adequate representatives of
the Settlement Class, (ii) whether the Settlement is fair, reasonable, adequate and in the
best interests of the Settlement Class, (iii) whether the Order and Final Judgment should
be entered, (iv) any objections to the Settlement, (v) the Fee Application (defined in
paragraph 15 of the Agreement), and any objections thereto, and (vi) any such other
matters as the Court may deem necessary and appropriate. The Settlement Hearing may,
from time to time and without further notice to the Settlement Class Members, be
continued or adjourned by order of the Court.
Any Settlement Class Member who objects to the terms of Agreement, the proposed
Settlement, the settlement class action determination, the entry of the Order and Final
Judgment approving the Settlement and/or the Fee Application, or who otherwise wishes
to be heard at the Settlement Hearing, may appear in person or by her, his or its attorney
at the Settlement Hearing and present any evidence or argument that may be proper and
relevant; provided, however, that no Person (other than the Parties) shall be heard, and
no papers, briefs, pleadings or other documents submitted by any such Person shall be
received and considered by the Court (unless the Court in its discretion otherwise shall
direct, upon application of such Person and for good cause shown), unless no later than
ten (10) calendar days prior to the Settlement Hearing, that Person has served, by hand or
overnight delivery upon each of the counsel for the Parties to these actions, to wit:
Paul M. Brannon
BRANNON LAW FIRM, LLC
3500 North Hullen Street
Metairie, LA 70002
Telephone: (504) 456-8696
Facsimile: (504) 456-8697
pmb@braiinonlawfirm.com
Counsellor Plaintiff and the Settlement
Class
Brian P. Murray
Gregory B. Linkh
GLANCY BINKOW & GOLDBERG LLP
77 Water Street, Suite 721
New York, NY 10005
Telephone: (646) 722-4180
Facsimile: (310) 201-9160
bmurray@glancylaw.com
g1inkhmurrayfrank.com
Counselfor Plaintiff and the Settlement
Class
Eric J. O'Bell
O'BELL, LLC
3500 North Hullen Street
Metairie, LA 70002
Telephone: (504) 456-8677
Facsimile: (504) 456-8653
cric@ghwlegal.com
Counsel for Plaintiff and the Settlement Class
Macye O'Connor, Esq.
DEBEVOISE & PLIMPTON LLP
919 Third Avenue
New York, NY 10022
Telephone: (212) 909-6315
Facsimile: (212) 872-1002
mloconnor@debevoise.com
Counsel for Defendants Markel Corporation
and Commonwealth Merger Subsidiary
Limited
Case 1:13-cv-00933-ALC-HBP Document 29 Filed 06/26/13 Page 57 of 60
Robert H. Pees, Esq.
AKIN GUMP STRAUSS HAU]ER & FELD,
LLP
One Bryant Park
New York, NY 10036
Telephone: (212) 872-1070
Facsimile: (212) 872-1002
rpees@akingump.com
Counsel for Defendants Alterra Capital
Holdings Limited, W. Marston Becker,
Michael O'Reilly, James D. Carey, Meryl D.
Hartzband, Willis 1'. King, Jr., James L.
Zech, Mario P. Torsieio, K. Bruce Connell,
James H. Macnaughton, W. Thomas
Forrester, Stephan F. Newhouse and
Andrew H. Rush
and filed with the Clerk of the United States District Court for the Southern District of
New York, 40 Foley Square, New York, NY 10007, the following materials: (i) written
notice of the intention to appear, (ii) a detailed statement of all of such Person's
objections to any matter before the Court, including all of the grounds therefor and/or the
reasons for such Person's desiring to appear and to be heard, signed personally by such
objector, (iii) documentary proof of such Person's membership in the Settlement Class,
and (iv) all documents and writings which such Person desires the Court to consider are
filed by such Person with the Court. Any Settlement Class Member who does not make
his, her or its objection in the manner provided shall be deemed to have waived such
objection and shall forever be foreclosed from making any objection to the fairness or
adequacy of the Settlement as incorporated in the Agreement unless otherwise ordered by
the Court.
8. The Court preliminarily enjoins all proceedings in the Action (other than proceedings as
may be necessary to carry out the terms and conditions of the Settlement or to provide
status reports to the Court) and orders that, pending final determination of whether the
Settlement provided for in the Agreement should be approved, the Plaintiff and all the
Settlement Class Members, or any of them, shall be barred and enjoined from
commencing, prosecuting, instigating, continuing or in any way participating in the
commencement or prosecution of any action asserting any or all of the Class Released
Claims, either directly, representatively, derivatively or in any other capacity, against any
or all of the Defendant Releasees, or challenging the Settlement (other than in the Action
in accordance with the procedures established by the Court).
Signed this
day of
,2013
Judge Andrew L. Carter, Jr.
United States District Judge
Case 1:13-cv-00933-ALC-HBP Document 29 Filed 06/26/13 Page 58 of 60
Exhibit D
Case 1:13-cv-00933-ALC-HBP Document 29 Filed 06/26/13 Page 59 of 60
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
LOUISIANA MUNICIPAL POLICE
EMPLOYEES RETIREMENT SYSTEM,
Individually on Behalf of Itself and All
Others Similarly Situated,
Plaintiff,
:
No. 13. CIV. 0933
Im
ALTERRA CAPITAL HOLDINGS
LIMITED, W. MARSTON BECKER,
MICHAEL O'REILLY, JAMES D. CAREY,
MERYL D. HARTZBAND, WILLIS T.
KING, JR., JAMES L. ZECH, MARIO P.
TORSIELLO, K. BRUCE CONNELL,
JAMES H. MACNAUGHTON, W.
THOMAS FORRESTER, STEPHAN F.
NEWHOUSE, ANDREW H. RUSH,
MARKEL CORPORATION, and
COMMONWEALTH MERGER
SUBSIDIARY LIMITED,
Defendants,
[PROPOSED] ORDER AND FINAL JUDGMENT
WHEREAS, the Court has reviewed and considered the terms and conditions of the
Stipulation and Agreement of Compromise and Settlement dated June 20, 2013 (the
"Agreement") that has been entered into by and between the Louisiana Municipal Police
Employees Retirement System ("Plaintiff'), on behalf of itself as well as members of the
Settlement Class (as defined below), and defendants W. Marston Becker, Michael O'Reilly,
James D. Carey, Meryl D. Hartzband, Willis T. King, Jr., James L. Zech, Mario P. Torsiello, K.
Bruce Connell, James H. Macnaughton, W. Thomas Forrester, Stephan F. Newhouse, Andrew H.
Rush, Alterra Capital Holdings Limited ("Alterra"), Markel Corporation, and Commonwealth
Merger Subsidiary Limited (collectively, the "Defendants," and collectively with the Plaintiff,
the "Parties"), and held a fairness hearing on
, with notice of the hearing having
been given in accordance with the Court's Order dated
'and considered all of the
submissions and arguments with respect to Plaintiff's Motion for Final Approval of the
Settlement, and having ruled on the motion;
NOW, IT IS HEREBY ORDERED, ADJUDGED AND DECREED that:
Case 1:13-cv-00933-ALC-HBP Document 29 Filed 06/26/13 Page 60 of 60
1. Capitalized terms herein have the same meaning as they are given in the Agreement.
2. The prerequisites to a class action set forth in Rule 23(a) of the Federal Rules of Civil
Procedure are satisfied, that Plaintiff is an adequate representatives of the Settlement
Class, and that the Action properly may be maintained as a non-opt-out class action
pursuant to Rule 23(b)(1) of the Federal Rules of Civil Procedure.
3. The Court certifies a non-opt-out Settlement Class consisting of all record holders and
beneficial owners of Alterra common stock who held such stock at any time during the
period beginning on and including December 19, 2012, through and including May 1,
2013 including any and all of their respective successors-in-interest, successors,
predecessors-in-interest, predecessors, representatives, trustees, executors, administrators,
estates, heirs, assigns or transferees, immediate and remote, and any Person acting for or
on behalf of, or claiming under, any of them, and each of them, together with their
respective successors-in-interest, successors, predecessors-in-interest, predecessors,
representatives, trustees, executors, administrators, estates, heirs, assigns and transferees.
Excluded from the Settlement Class are the Defendants and their respective immediate
family members, directors, partners, direct or indirect parent or subsidiary entities, and
any other Person over whom or which any Defendant exercises sole or exclusive control.
4. The Court approves the Settlement, and all transactions preparatory or incident thereto, as
fair, reasonable, adequate and in the best interests of the Settlement Class Member. The
Court authorizes and directs performance of the Settlement in accordance with all of its
terms and conditions.
5. The above-captioned action (the "Action") is hereby dismissed, with prejudice and
without costs, as against the Plaintiff and the Settlement Class Members. All Released
Claims against all Defendant Releasees and all Plaintiff Releasees are hereby
extinguished.
6. Plaintiff's motion for an award of attorneys' fees and expenses is approved. Alterra (or
its successor, insurers or reinsurers) shall pay or cause to be paid $340,000.00 of such
fees and expenses within ten (10) business days after notice of entry of the Court's order
approving the Settlement. Except as otherwise specifically provided by the Settlement
Agreement or ordered by the Court, the Parties shall each be responsible for his, her, or
its own costs, attorneys' fees, and expenses.
7. The Court reserve jurisdiction over the Action, without affecting the finality of this Order
and Final Judgment, with respect to all matters relating to the administration,
consummation, construction and enforcement of the Settlement.
Signed this
day of
,2013
Judge Andrew L. Carter, Jr.
United States District Judge