AS FILED WITH THE SECURITIES AND EXCHANGE COMMISSION ON JANUARY 12, 1998
Registration No. 333-
================================================================================
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
---------------
FORM S-8
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
---------------
ESG RE LIMITED
(Exact name of registrant as specified in its charter)
BERMUDA NOT APPLICABLE
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
---------------
SKANDIA INTERNATIONAL HOUSE
16 CHURCH STREET
HAMILTON, HM 11, BERMUDA
(441) 295-2185
(Address, Including Zip Code, and Telephone Number,
including Area Code, of Registrant's Principal Executive Offices)
---------------
ESG RE LIMITED
NON-MANAGEMENT DIRECTORS' COMPENSATION AND OPTION PLAN
AND 1997 STOCK OPTION PLAN
(Full title of the plan)
---------------
ESG RE LIMITED
C/O CT CORPORATION SYSTEM
1633 BROADWAY
NEW YORK, NEW YORK 10019
(212) 664-1666
(Name and Address, including Zip Code,
and Telephone Number, including Area Code of Agent For Service)
---------------
COPY TO:
RICHARD S. BORISOFF, ESQ.
PAUL, WEISS, RIFKIND, WHARTON & GARRISON
1285 AVENUE OF THE AMERICAS
NEW YORK, NEW YORK 10019-6064
(212) 373-3000
---------------
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
PROPOSED PROPOSED
MAXIMUM MAXIMUM
TITLE OF EACH CLASS OF SECURITIES AMOUNT OFFERING PRICE AGGREGATE OFFERING AMOUNT OF
TO BE REGISTERED TO BE REGISTERED PER SHARE (1) PRICE (1) REGISTRATION FEE
- --------------------------------- ------------------ --------------- ------------------ ----------------
<S> <C> <C> <C> <C>
Common Shares, par value $1.00
per share........................ 3,000,000 $23.03 $69,090,000 $20,382
================================= ================== =============== ================== ================
</TABLE>
(1) Based on a price per share of $23.03, representing the average of the high
and low prices reported on the Nasdaq National Market on January 2, 1998 and
estimated solely for purposes of calculating the registration fee pursuant
to Rule 457(h)(1) of the Securities Act of 1933.
================================================================================
<PAGE>
EXPLANATORY NOTE
The Section 10(a) prospectuses being delivered by ESG Re Limited
(the "Company") to participants in the Company's 1997 Stock Option Plan (the
"Stock Option Plan") and to participants in the Company's Non-Management
Directors' Compensation and Option Plan (the "Directors' Plan," and together
with the Stock Option Plan, the "Plans") as required by Rule 428 under the
Securities Act of 1933, as amended (the "Securities Act"), have been prepared in
accordance with the requirements of Form S-8 and relate to Common Shares, par
value $1.00 per share (the "Common Shares"), reserved for issuance pursuant to
the Plans. The Plan information required in the Section 10(a) prospectuses is
included in documents being maintained and delivered by the Company as required
by Rule 428 under the Securities Act. The Company shall provide to participants
in the Plans a written statement advising them of the availability without
charge, upon written or oral request, of documents incorporated by reference
herein, as is required by Item 2 of Part I of Form S-8.
<PAGE>
PART II
INFORMATION REQUIRED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE
The following documents filed by the Company with the Securities and
Exchange Commission (the "Commission") are incorporated herein by reference:
(a) The Company's Prospectus, dated December 12, 1997, which
was filed with the Commission pursuant to Rule 424(b) promulgated under the
Securities Act of 1933, as amended (the "Securities Act"), and relates to the
Company's Registration Statement on Form F-1, which was declared effective on
December 12, 1997;
All other documents filed by the Company pursuant to Sections 13(a),
13(c), 14 or 15(d) of the Exchange Act subsequent to the date of this
registration statement and prior to the filing of a post-effective amendment
which indicates that all securities registered hereby have been sold or which
deregisters all securities then remaining unsold, shall be deemed to be
incorporated by reference in this registration statement and to be part hereof
from the date of filing of such documents.
ITEM 4. DESCRIPTION OF SECURITIES
Not Applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL
Not applicable.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Section 98 of the Companies Act 1981 of Bermuda (the "Companies
Act") provides generally that a Bermudian company may indemnify its directors,
officers and auditors against any liability which by virtue of any rule of
Bermudian law with respect to any negligence, default, breach of duty or breach
of trust except in cases where such liability arises from fraud or dishonesty of
which such director, officer or auditor may be guilty in relation to the
company. Section 98 further provides that a Bermudian company may indemnify its
directors, officer and auditors against any liability incurred by them in
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<PAGE>
defending any proceedings, whether civil or criminal, in which judgement is
awarded in their favor or they are acquitted or in which they are acquitted or
granted relief by the Supreme Court of Bermuda in certain proceedings arising
under Section 281 of the Companies Act.
The Company has adopted provisions in its Memorandum of Association
and Bye-Laws that provide that the Company shall indemnify its officers and
directors to the maximum extent permitted under the Act. The Company also its
issued a deed of indemnity for the benefit of directors and officers to provide
them with the maximum indemnification allowed under its Memorandum of
Association, Bye-Laws and the Act.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED
Not Applicable.
ITEM 8. EXHIBITS
4.1 -- Specimen Common Share Certificate (incorporated by reference to
Exhibit 4.1 to the Company's Registration Statement on Form F-1
(No. 333-40341))
4.2 -- Form of Class A Warrant (incorporated by reference to Exhibit 4.2
to the Company's Registration Statement on Form F-1 (No. 333-40341))
4.3 -- Form of Class B Warrant
5.2 -- Opinion of Appleby, Spurling & Kempe as to the legality of Common
Shares being registered.
23.1 -- Consent of Deloitte & Touche GmbH
23.2 -- Consent of Deloitte & Touche, Hamilton, Bermuda
24.1 -- Power of Attorney (included on signature page of this registration
statement)
ITEM 9. UNDERTAKINGS
The undersigned registrant hereby undertakes: (1) to file, during
any period in which offers or sales are being made, a post-effective amendment
to this registration statement to include any material information with respect
to the plan of distribution not previously disclosed in this registration
statement or any material change to such information in this registration
statement; (2) that, for the purpose of determining any liability under the
Securities Act each such post-effective amendment shall be deemed to be a new
registration statement relating to the securities offered therein, and the
offering of such securities at that
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<PAGE>
time shall be deemed to be the initial bona fide offering thereof; and (3) to
remove from registration by means of a post-effective amendment any of the
securities being registered which remain unsold at the termination of the
offering.
The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act, each filing of the
registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 that is incorporated by reference in this
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and controlling persons
of the registrant pursuant to the registrant's Bye-laws, by contract, or
otherwise, the registrant has been advised that in the opinion of the Securities
and Exchange Commission such indemnification is against public policy as
expressed in the Securities Act and is, therefore, unenforceable. In the event
that a claim for indemnification against such liabilities (other than the
payment by the registrant of expenses incurred or paid by a director, officer or
controlling person of the registrant in the successful defense of any action,
suit or proceeding) is asserted by such director, officer or controlling person
in connection with the securities being registered, the registrant will, unless
in the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the
Securities Act and will be governed by the final adjudication of such issue.
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<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, as
amended, the registrant certifies that it has reasonable grounds to believe that
it meets all of the requirements for filing on Form S-8 and has duly caused this
registration statement to be signed on its behalf by the undersigned, thereunto
duly authorized, on January 7, 1998.
ESG Re Limited
By: /s/ Gerhard Jurk
-------------------------------
Name: Gerhard Jurk
Title: Chief Financial Officer
We, the undersigned officers and directors of ESG Re Limited, hereby
severally constitute Wolfgang M. Wand or Gerhard Jurk our true and lawful
attorney with full power to sign for us and in our names in the capacities
indicated below, any and all amendments, including post-effective amendments, to
this registration statement, and generally do all such things in our name and
behalf in such capacities to enable ESG Re Limited to comply with the applicable
provisions of the Securities Act of 1933, as amended, and all requirements of
the Securities and Exchange Commission, and we hereby ratify and confirm our
signatures as they may be signed by our said attorney to any and all such
amendments.
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<PAGE>
Pursuant to the requirements of the Securities Act of 1933, this
registration statement has been signed by the following persons in the
capacities and on the dates indicated.
<TABLE>
<CAPTION>
SIGNATURES TITLE DATE
<S> <C> <C>
/s/ Wolfgang M. Wand Chief Executive Officer and Director January 7, 1998
- ---------------------------- (Principal Executive Officer)
Wolfgang M. Wand
/s/ Gerhard Jurk Chief Financial Officer and Director January 7, 1998
- ---------------------------- (Principal Financial and Accounting
Gerhard Jurk Officer)
/s/ John C Head III Director January 7, 1998
- ----------------------------
John C Head III
Director January 7, 1998
- ----------------------------
William J. Poutsiaka
Director January 7, 1998
- ----------------------------
Edward A. Tilly
/s/ David L. Newkirk Director January 7, 1998
- ----------------------------
David L. Newkirk
/s/ John C Head III Authorized Representative in the January 7, 1998
- ---------------------------- United States
John C Head III
</TABLE>
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<PAGE>
INDEX TO EXHIBITS
EXHIBITS
4.1 -- Specimen Common Share Certificate (incorporated by
reference to Exhibit 4.1 to the Company's Registration
Statement on Form F-1 (No. 333-40341))
4.2 -- Form of Class A Warrant (incorporated by reference to
Exhibit 4.2 to the Company's Registration Statement on
Form F-1 (No. 333-40341))
4.3 -- Form of Class B Warrant
5.2 -- Opinion of Appleby, Spurling & Kempe as to the legality of
Common Shares being registered.
23.1 -- Consent of Deloitte & Touche GmbH
23.2 -- Consent of Deloitte & Touche, Hamilton, Bermuda
24.1 -- Power of Attorney (included on signature page of this
registration statement.)
II-6
Exhibit 4.3
CLASS B WARRANT
ESG RE LIMITED
THIS WARRANT AND THE UNDERLYING COMMON SHARES MAY NOT BE TRANSFERRED EXCEPT (I)
IN COMPLIANCE WITH THE PROVISIONS OF THE BYE-LAWS OF THE COMPANY AND ANY
APPLICABLE STATE SECURITIES OR "BLUE SKY" LAWS AND (II) (A) PURSUANT TO AN
EFFECTIVE REGISTRATION UNDER THE SECURITIES ACT OF 1933, AS AMENDED (THE "ACT"),
(B) IN COMPLIANCE WITH RULE 144 UNDER THE ACT, (C) INSIDE THE UNITED STATES TO A
"QUALIFIED INSTITUTIONAL BUYER" AS DEFINED IN AND IN COMPLIANCE WITH RULE 144A
UNDER THE ACT, (D) OUTSIDE THE UNITED STATES IN COMPLIANCE WITH RULE 904 OF
REGULATION S UNDER THE ACT OR (E) INSIDE THE UNITED STATES TO AN INSTITUTIONAL
"ACCREDITED INVESTOR" AS DEFINED IN RULE 501(A)(1), (2), (3) OR (7) UNDER THE
ACT IN A TRANSACTION WHICH, IN THE OPINION OF COUNSEL REASONABLY SATISFACTORY TO
THE COMPANY, QUALIFIES AS AN EXEMPT TRANSACTION UNDER THE ACT AND THE RULES AND
REGULATIONS PROMULGATED THEREUNDER. THIS WARRANT AND THE UNDERLYING COMMON
SHARES ARE SUBJECT TO CERTAIN ADDITIONAL RESTRICTIONS ON TRANSFER CONTAINED IN A
SUBSCRIPTION AGREEMENT AND THE COMPANY'S BYE-LAWS, COPIES OF WHICH ARE ON FILE
AT THE PRINCIPAL OFFICE OF THE COMPANY.
ESG RE LIMITED, a Bermuda corporation (the "Company"), hereby
certifies that, for value received, [Holder] (the "Holder"), or assigns, is
entitled, subject to the terms set forth below, to purchase from the Company, at
any time and from time to time in whole or in part an aggregate of ____________
(the "Aggregate Warrant Number") fully paid and non-assessable Common Shares,
par value $1.00 per share ("Common Shares"), of the Company during the period
beginning, with respect to each Installment (as defined below), on the date of
the vesting of such Installment (each a "Vesting Date") and ending, with respect
to each Installment, on the tenth anniversary of the Vesting Date with respect
to such Installment (the "Exercise Period").
The Common Shares within each Installment shall be purchased at a
purchase price per Common Share, subject to the provisions of Paragraph 3
hereof, equal to (a) $20 (the "Price to Public") until September 1, 2001, if
applicable and (b) $18.50 during the balance of the Exercise Period (in each
case as adjusted in accordance with the terms hereof, the "Purchase Price"). The
number and character of such Common Shares are subject to adjustment as provided
below, and the term
<PAGE>
2
"Common Shares" shall mean, unless the context otherwise requires, the Common
Shares or other securities or property at the time deliverable upon the exercise
of this Warrant. This Warrant is herein called the "Warrant."
1. VESTING OF WARRANTS. Each of the 5 successive one-year periods
commencing on the earlier of the closing of the Company's initial public
offering of Common Shares and December 31, 1997 (the "Issue Date") and ending on
the day before the first 5 anniversary dates thereof is referred to below as an
"Anniversary Period". During each Anniversary Period 20% of the Aggregate Number
of Warrants (an "Installment") shall be eligible to become vested. Any Warrants
that are eligible to become vested during a particular Anniversary Period but
that do not become vested during that Anniversary Period shall be eligible to
become vested in the subsequent Anniversary Periods, in additional to the
Installment for that subsequent Anniversary Period. Any Warrants that are
unvested following the fifth Anniversary Period shall be forfeited and shall no
longer be deemed to be outstanding, without any further action on the part of
the Company. In the event of a Change of Control of the Company, all unvested
Warrants shall immediately and automatically vest. The Installments that are
available for vesting during any particular Anniversary Period shall become
vested if, on each trading day of any 20 consecutive trading days during such
Anniversary Period, (a) the change in the Market Price (as defined in Section
3.1) of the Common Shares from the Floor Price (the "Market Price Change"),
expressed as a percentage, exceeds (or in the event that the Market Price Change
and the Wilshire Index Change (as defined below) are both negative, is less
than) (b) the change in the Wilshire Index from the Wilshire Index Floor (the
"Wilshire Index Change"), expressed as a percentage, plus 5.0%.
For purposes of this Paragraph 1, the following terms have the
following meanings:
"CHANGE OF CONTROL" means the acquisition by any person, entity or
"group" (within the meaning of Section 13(d)(3) or 14(d)(2) of the Securities
Exchange Act of 1934 (the "Exchange Act")) of beneficial ownership (within the
meaning of Rule 13d-3 promulgated under the Exchange Act) of 50% or more, in the
aggregate, of either the voting power of the then outstanding Common Shares or
the combined voting power of the Company's then outstanding voting securities
entitled to vote generally in the election of directors; provided, however, that
if such acquisition results in whole or in part from a transfer of any Common
Shares or other voting securities by the Holder hereof, such acquisition shall
not constitute a Change of Control unless such transfer is effected pursuant to
an offer by such acquiror to purchase all of the Company's outstanding Common
Shares.
"FLOOR PRICE" means the Price to Public.
<PAGE>
3
"WILSHIRE INDEX FLOOR" means the closing quotation of the Wilshire
5000 Index as of the Issue Date, as prepared by Wilshire Associates, Inc. and as
reported on Bloomberg Financial Markets.
"WILSHIRE INDEX" as of any day means the average closing quotation
of the Wilshire 5000 Index for the 15 consecutive trading days concluding on
such day.
"WILSHIRE 5000 INDEX" means the index of that name prepared by
Wilshire Associates, Inc., as reported on Bloomberg Financial Markets or, in the
event the Wilshire 5000 Index is no longer published, a comparable index
selected in good faith by the Board of Directors of the Company providing a
broad-based measurement of the changes in stock market conditions.
2. EXERCISE OF WARRANT. The purchase rights evidenced by this
Warrant shall be exercised by the Holder surrendering this Warrant, with the
form of subscription at the end hereof duly executed by such Holder (the
"Exercise Notice"), to the Company at its offices, 16 Church Street , Hamilton,
Pembroke Parish, Bermuda, accompanied by payment as specified below of the
aggregate Purchase Price determined as of the Determination Date (as defined
below) of the Common Shares being purchased pursuant to such exercise. Payment
of the aggregate Purchase Price may be made, at the option of the Holder, (i) in
cash, (ii) by certified check or bank cashier's check payable to the order of
the Company in the amount of such Purchase Price, (iii) by delivering Common
Shares with an aggregate Market Price (as hereinafter defined) as of the day
prior to the Company's receipt of the Exercise Notice (the "Determination Date")
equal to the product of the Purchase Price and the number of Common Shares being
purchased, (iv) by the Company reducing, at the request of the Holder, the
number of Common Shares for which this Warrant is exercisable by a number of
Common Shares (the "Surrendered Shares") such that the product of (a) the Market
Price per Common Share as of the Determination Date less the Purchase Price in
effect on the Determination Date and (b) the number of Surrendered Shares equals
or exceeds the product of (x) the Purchase Price in effect on the Determination
Date and (y) the number of Common Shares being purchased, or any combination of
the methods of payment described in clauses (i) through (iv) above.
2.1 PARTIAL EXERCISE. This Warrant may be exercised for less
than the full number of Common Shares at the times called for hereby, in which
case the number of Common Shares receivable upon the exercise of this Warrant as
a whole, and the sum payable upon the exercise of this Warrant as a whole, shall
be proportionately reduced. Upon any such partial exercise, the Company at its
expense will forthwith issue to the holder hereof a new Warrant or Warrants of
like tenor calling for the number of Common Shares as to which rights have not
been exercised, such Warrant or Warrants to be issued in the name of the holder
hereof or his nominee (upon payment by such holder of any applicable transfer
taxes).
<PAGE>
4
2.2 DELIVERY OF CERTIFICATES FOR COMMON SHARES ON CONVERSION.
As soon as practicable after the exercise of this Warrant and payment of the
Purchase Price, and in any event within ten (10) days thereafter, the Company,
at its expense, will cause to be issued in the name of and delivered to the
holder hereof a certificate or certificates for the number of fully paid and
non-assessable Common Shares or other securities or property to which such
Holder shall be entitled upon such exercise, plus, in lieu of any fractional
share to which such holder would otherwise be entitled, cash in an amount
determined in accordance with Paragraph 3.9 hereof. The Common Shares so
received shall be deemed to be issued to the Holder as the record owner of such
Common Shares as of the close of business on the date on which this Warrant is
surrendered and payment made for such Common Shares as aforesaid.
3. ANTI-DILUTION PROVISIONS AND OTHER
ADJUSTMENTS. In order to prevent dilution of the right granted hereunder, the
Purchase Price shall be subject to adjustment from time to time in accordance
with this Paragraph 3. Upon each adjustment of the Purchase Price pursuant to
this Paragraph 3, the registered holder hereof shall thereafter be entitled to
acquire upon exercise of this Warrant, at the Purchase Price resulting from such
adjustment, the number of the Company's Common Shares obtainable by multiplying
the Purchase Price in effect immediately prior to such adjustment by the number
of the Company's Common Shares acquirable upon conversion thereof immediately
prior to such adjustment and dividing the product thereof by the Purchase Price
resulting from such adjustments.
3.1 ADJUSTMENT FOR ISSUE OR SALE OF COMMON SHARES AT LESS THAN
90% OF MARKET PRICE. Except as provided in Paragraph 3.2 or 3.5 below, if and
whenever on or after the date of issuance hereof the Company shall issue or
sell, or shall in accordance with subparagraphs 3.1(1) to (9), inclusive, be
deemed to have issued or sold, other than any issuance or sale in connection
with an underwritten public offering, any Common Shares for a consideration per
share less than 90% of the Market Price in effect immediately prior to the time
of such issue or sale, then forthwith upon such issue or sale (the "Triggering
Transaction"), the Purchase Price shall, subject to subparagraphs (1) to (9) of
this Paragraph 3.1, be reduced to the Purchase Price (calculated to the nearest
tenth of a cent) determined by multiplying the Purchase Price in effect
immediately prior to the time of such issue or sale by a fraction, the numerator
of which shall be the sum of (x) the product of the Number of Common Shares
Deemed Outstanding immediately prior to such Triggering Transaction multiplied
by the Market Price immediately prior to such Triggering Transaction plus (y)
the total amount, if any, received or receivable at any time by the Company as
consideration for the issuance or sale of such Common Shares and the denominator
of which shall be the product of (x) the Number of Common Shares Deemed
Outstanding immediately after such issue or sale, multiplied by (y) the Market
Price immediately prior to such issue or sale.
<PAGE>
5
For purposes of this Paragraph 3, the term "Number of Common Shares
Deemed Outstanding" at any given time shall mean the sum of (i) the number of
the Company' s Common Shares outstanding at such time, and (ii) the number of
the Company's Common Shares deemed to be outstanding under subparagraphs 3.1(1)
to (9), inclusive, at such time. For purposes of this Agreement, the term
"Market Price" as of any day shall mean the average closing price of a Common
Share or other security for the 15 consecutive trading days concluding on such
day on the principal national securities exchange on which the Common Shares or
securities are listed or admitted to trading or, if not listed or admitted to
trading on any national securities exchange, the average of the reported bid and
asked prices during such 15 trading day period in the over-the-counter market as
furnished by the National Quotation Bureau, Inc., or, if such firm is not then
engaged in the business of reporting such prices, as furnished by any member of
the National Association of Securities Dealers, Inc. selected by the Company or,
if the Common Shares or securities are not publicly traded, the Market Price for
such day shall be the fair market value thereof determined in good faith by the
Board of Directors of the Company.
For purposes of determining the adjusted Purchase Price under this
Paragraph 3.1, the following subsections (1) to (9), inclusive, shall be
applicable:
(1) In case the Company at any time shall in any manner grant
(whether directly or by assumption in a merger or otherwise) any rights to
subscribe for or to purchase, or any options for the purchase of, Common
Shares or any other securities convertible into or exchangeable for Common
Shares (such rights or options being herein called "Options" and such
convertible or exchangeable shares or securities being herein called
"Convertible Securities"), whether or not such Options or the right to
convert or exchange any such Convertible Securities are immediately
exercisable and the price per share for which the Common Shares are
issuable upon exercise, conversion or exchange (determined by dividing (x)
the total amount, if any, received or receivable by the Company as
consideration for the granting of such Options, plus the minimum aggregate
amount of additional consideration payable to the Company upon the
exercise of all such Options, plus, in the case of such Options which
relate to Convertible Securities, the minimum aggregate amount of
additional consideration, if any, payable upon the issue or sale of such
Convertible Securities and upon the conversion or exchange thereof, by (y)
the total maximum number of Common Shares issuable upon the exercise of
such Options or the conversion or exchange of such Convertible Securities)
shall be less than 90% of the Market Price determined as of the date of
such grant, then the total maximum number of Common Shares issuable upon
exercise of such Options or conversion or exchange of all such Convertible
Securities shall (as of the date of the grant of such Option) be deemed to
be outstanding and to have been issued and sold by the Company for such
price per share. No adjustment of the Purchase Price shall be made
<PAGE>
6
upon exercise of such Options or conversion or exchange of such
Convertible Securities, except as otherwise provided in subparagraph (3)
below.
(2) In case the Company at any time shall in any manner issue
(whether directly or by assumption in a merger or otherwise) or sell any
Convertible Securities, whether or not the rights to exchange or convert
thereunder are immediately exercisable, and the price per share for which
Common Shares are issuable upon such conversion or exchange (determined by
dividing (x) the total amount received or receivable by the Company as
consideration for the issue or sale of such Convertible Securities, plus
the minimum aggregate amount of additional consideration, if any, payable
to the Company upon the conversion or exchange thereof, by (y) the total
maximum number of Common Shares issuable upon the conversion or exchange
of all such Convertible Securities) shall be less than the 90% of Market
Price, determined as of the date of such issue or sale, as the case may
be, then the total maximum number of Common Shares issuable upon
conversion or exchange of all such Convertible Securities shall (as of the
date of the issue or sale of such Convertible Securities) be deemed to be
outstanding and to have been issued and sold by the Company for such price
per share. No adjustment of the Purchase Price shall be made upon the
actual issue of such Common Shares upon exercise of the rights to exchange
or convert under such Convertible Securities, except as otherwise provided
in subparagraph (3) below.
(3) If the exercise price provided for in any Options referred
to in subparagraph (1), the additional consideration, if any, payable upon
the conversion or exchange of any Convertible Securities referred to in
subparagraphs (1) or (2), or the rate at which any Convertible Securities
referred to in subparagraph (1) or (2) are convertible into or
exchangeable for Common Shares shall change at any time (other than under
or by reason of provisions designed to protect against dilution of the
type set forth in Paragraph 3.1 or 3.3), the Purchase Price in effect at
the time of such change shall forthwith be readjusted to the Purchase
Price which would have been in effect at such time had such Options or
Convertible Securities still outstanding provided for such changed
purchase price, additional consideration or conversion or exchange rate,
as the case may be, at the time initially granted, issued or sold. If the
exercise price provided for in any Option referred to in subparagraph (1),
the additional consideration, if any, payable upon the conversion or
exchange of any Convertible Securities referred to in subparagraphs (1) or
(2), or the rate at which any Convertible Securities referred to in
subparagraphs (1) or (2) are convertible into or exchangeable for Common
Shares, shall be reduced at any time under or by reason of provisions with
respect thereto designed to protect against dilution, then in case of the
delivery of Common Shares upon the exercise of any such Option or upon
conversion or exchange of any such Convertible Security, the Purchase
Price
<PAGE>
7
then in effect hereunder shall forthwith be adjusted to such respective
amount as would have been obtained had such Option or Convertible Security
never been issued as to such Common Shares and had adjustments been made
upon the issuance of Common Shares delivered as aforesaid, but only if as
a result of such adjustment the Purchase Price then in effect hereunder is
hereby reduced and provided that there shall be no duplication of any
adjustments otherwise made in accordance with the terms hereof.
(4) On the expiration of any Option or the termination of any
right to convert or exchange any Convertible Securities, the Purchase
Price then in effect hereunder shall forthwith be increased to the
Purchase Price which would have been in effect at the time of such
expiration or termination had such Option or Convertible Securities, to
the extent outstanding immediately prior to such expiration or
termination, never been issued.
(5) In case any Options shall be issued in connection with the
issue or sale of other securities of the Company, together comprising one
integral transaction in which no specific consideration is allocated to
such Options by the parties thereto, such Options shall be deemed to have
been issued without consideration.
(6) In case any Common Shares, Options or Convertible
Securities shall be issued or sold or deemed to have been issued or sold
for cash, the consideration received therefor shall be deemed to be the
amount received by the Company therefor. In case any Common Shares,
Options or Convertible Securities shall be issued or sold for a
consideration other than cash, the amount of the consideration other than
cash received by the Company shall be the fair value of such consideration
as determined in good faith by the Board of Directors of the Company.
(7) The number of Common Shares outstanding at any given time
shall not include shares owned or held by or for the account of the
Company, and the disposition of any shares so owned or held shall be
considered an issue or sale of Common Shares for the purpose of this
Paragraph 3.1.
(8) In case the Company shall declare a dividend or make any
other distribution upon the shares of the Company payable in Common
Shares, Options, or Convertible Securities, then in such case any Common
Shares, Options or Convertible Securities, as the case may be, issuable in
payment of such dividend or distribution shall be deemed to have been
issued or sold without consideration.
(9) For purposes of this Paragraph 3.1, in case the Company
shall take a record of the holders of its Common Shares for the purpose of
<PAGE>
8
determining holders entitled (x) to receive a dividend or other
distribution payable in Common Shares, Options or in Convertible
Securities, or (y) to subscribe for or purchase Common Shares, Options or
Convertible Securities, then such record date shall be deemed to be the
date of the issue or sale of the Common Shares deemed to have been issued
or sold upon the declaration of such dividend or the making of such other
distribution or the date of the granting of such right or subscription or
purchase, as the case may be.
3.2 DIVIDENDS NOT PAID OUT OF EARNINGS OR EARNED SURPLUS. In
the event the Company shall declare a dividend upon the Common Shares (other
than a dividend covered by subparagraph 3.1(8)) payable otherwise than out of
earnings or earned surplus, determined in accordance with generally accepted
accounting principles, including the making of appropriate deductions for
minority interests, if any, in subsidiaries (herein referred to as "Liquidating
Dividends"), then, as soon as possible after the exercise of this Warrant, the
Company shall pay to the person exercising such Warrant an amount equal to the
aggregate value at the time of such exercise of all Liquidating Dividends which
would have been payable to such person had such person exercised this Warrant on
the record date for determining persons entitled to such Liquidating Dividend.
For the purposes of this Paragraph 3.2, a dividend other than in cash shall be
considered payable out of earnings or earned surplus only to the extent that
such earnings or earned surplus are charged an amount equal to the fair value of
such dividend as determined in good faith by the Board of Directors of the
Company.
3.3 SUBDIVISIONS AND COMBINATIONS. In case the Company shall
at any time subdivide (other than by means of a dividend payable in Common
Shares covered by subparagraph 3.1(8)) its outstanding Common Shares into a
greater number of shares, the Purchase Price in effect immediately prior to such
subdivision shall be appropriately reduced, and conversely, in case the
outstanding Common Shares of the Company shall be combined into a smaller number
of shares, the Purchase Price in effect immediately prior to such combination
shall be proportion ately increased.
3.4 REORGANIZATION, RECLASSIFICATION, CONSOLIDATION, MERGER OR
SALE OF ASSETS. If any capital reorganization or reclassification of the capital
stock of the Company, or consolidation or merger of the Company with another
corporation, or the sale of all or substantially all of its assets to another
corporation shall be effected in such a way that holders of Common Shares shall
be entitled to receive stock, securities, cash or other property with respect to
or in exchange for Common Shares, then, as a condition of such reorganization,
reclassification, consolidation, merger or sale, lawful and adequate provision
shall be made whereby the holder of this Warrant shall have the right to acquire
and receive upon exercise hereof such common shares, securities, cash or other
property issuable or payable (as part of the reorganization, reclassification,
consolidation, merger or sale) with respect to or in exchange for such number of
outstanding Common Shares of the Company as
<PAGE>
9
would have been received upon exercise of the Warrant at the Purchase Price then
in effect. The Company will not effect any such consolidation, merger or sale,
unless prior to the consummation thereof the successor corporation (if other
than the Company) resulting from such consolidation or merger or the corporation
purchasing such assets shall assume, by written instrument mailed or delivered
to the holder of this Warrant at the last address of such holder appearing on
the books of the Company, the obligation to deliver to such holder such common
shares, securities or assets as, in accordance with the foregoing provisions,
such holder may be entitled to purchase. In the event that pursuant to the terms
of this Paragraph 3.4, this Warrant becomes exercisable for securities other
than Common Shares, then the provisions of Section 3 shall apply to such
securities as though such securities were Common Shares. If a purchase, tender
or exchange offer is made to and accepted by the holders of more than 50% of the
outstanding Common Shares of the Company, the Company shall not effect any
consolidation, merger or sale with the person having made such offer or with any
Affiliate of such person, unless prior to the consum mation of such
consolidation, merger or sale the holder of this Warrant shall have been given a
reasonable opportunity to then elect to receive upon the exercise of this
Warrant either the common shares, securities or assets then issuable with
respect to the Common Shares of the Company or the common shares, securities or
assets, or the equivalent, issued to previous holders of the Common Shares in
accordance with such offer. For purposes hereof the term "Affiliate" with
respect to any given person shall mean any person controlling, controlled by or
under common control with the given person.
3.5 NO ADJUSTMENT FOR EXERCISE OF CERTAIN OPTIONS, WARRANTS,
ETC. The provisions of this Section 3 shall not apply to any Common Shares
issued, issuable or deemed outstanding under subparagraphs 3.1(1) to (9)
inclusive: (i) to any person pursuant to any stock option, stock purchase or
similar plan or arrangement for the benefit of employees, consultants or
directors of the Company or its subsidiaries or (ii) pursuant to options,
warrants and conversion rights in existence on the date of issuance hereof.
3.6 NOTICES OF RECORD DATE, ETC. In the event that:
(1) the Company shall declare any cash dividend upon its
Common Shares, or
(2) the Company shall declare any dividend upon its Common
Shares payable in common shares or make any special dividend or
other distribution to the holders of its Common Shares, or
(3) the Company shall offer for subscription pro rata to the
holders of its Common Shares any additional common shares of any
class or other rights, or
<PAGE>
10
(4) there shall be any capital reorganization. or
reclassification of the capital stock of the Company, including any
subdivision or combination of its outstanding Common Shares, or
consolidation or merger of the Company with, or sale of all or
substantially all of its assets to, another corporation, or
(5) there shall be a voluntary or involuntary dissolution,
liquidation or winding up of the Company;
then, in connection with such event, the Company shall give to the holder of
this Warrant:
(i) at least ten (10) days prior written notice of the date on
which the books of the Company shall close or a record shall
be taken for such dividend, distribution or subscription
rights or for determining rights to vote in respect of any
such reorganization, reclassification, consolidation, merger,
sale, dissolution, liquidation or winding up; and
(ii) in the case of any such reorganization, reclassification,
consolidation, merger, sale, dissolution, liquidation or
winding up, at least ten (10) days, prior written notice of
the date when the same shall take place.
Such notice in accordance with the foregoing clause (i) shall also
specify, in the case of any such dividend, distribution or subscription rights,
the date on which the holders of Common Shares shall be entitled thereto, and
such notice in accordance with the foregoing clause (ii) shall also specify the
date on which the holders of Common Shares shall be entitled to exchange their
Common Shares for securities or other property deliverable upon such
reorganization, reclassification, consolidation, merger, sale, dissolution,
liquidation or winding up, as the case may be. Each such written notice shall be
given by first class mail, postage prepaid, addressed to the holder of this
Warrant at the address of such holder as shown on the books of the Company.
The failure to deliver any such notice shall not, however, affect
the validity of the action so taken by the Corporation.
3.7 GRANT, ISSUE OR SALE OF OPTIONS, CONVERTIBLE SECURITIES,
OR RIGHTS. If at any time or from time to time on or after the date of issuance
hereof, the Company shall grant, issue or sell any Options, Convertible
Securities or rights to purchase property (the "Purchase Rights") pro rata to
the record holders of any class of Common Shares of the Company and such grants,
issuances or sales do not result in an adjustment of the Purchase Price under
Paragraph 3.1 hereof (other than by reason of the fact that the issuance of such
shares was at a Purchase Price equal to or
<PAGE>
11
greater than 90% of the then current Market Price), then the holder of this
Warrant shall be entitled to acquire (within thirty (30) days after the later to
occur of the initial exercise date of such Purchase Rights or receipt by such
holder of the notice concerning Purchase Rights to which such holder shall be
entitled under Paragraph 3.6) upon the terms applicable to such Purchase Rights
either:
(i) the aggregate Purchase Rights which such holder could have
acquired if it had held the number of Common Shares acquirable
upon exercise of this Warrant immediately before the grant,
issuance or sale of such Purchase Rights; provided that if any
Purchase Rights were distributed to holders of Common Shares
without the payment of additional consideration by such
holders, corresponding Purchase Rights shall be distributed to
the exercising holder of this Warrant as soon as possible
after such exercise and it shall not be necessary for the
exercising holder of this Warrant specifically to request
delivery of such rights; or
(ii) in the event that any such Purchase Rights shall have expired
or shall expire prior to the end of said thirty (30) day
period, the number of Common Shares or the amount of property
which such holder could have acquired upon such exercise at
the time or times at which the Company granted, issued or sold
such expired Purchase Rights.
3.8 ADJUSTMENT BY BOARD OF DIRECTORS. If any event occurs as
to which, in the opinion of the Board of Directors of the Company, the
provisions of this Section 3 are not strictly applicable or if strictly
applicable would not fairly protect the rights of the holder of this Warrant in
accordance with the essential intent and principles of such provisions, then the
Board of Directors shall make an adjustment in the application of such
provisions, in accordance with such essential intent and principles, so as to
protect such rights as aforesaid, but in no event shall any adjustment have the
effect of increasing the Purchase Price as otherwise determined pursuant to any
of the provisions of this Section 3 except in the case of a combination of
shares of a type contemplated in Paragraph 3.3 and then in no event to an amount
larger than the Purchase Price as adjusted pursuant to Paragraph 3.3.
3.9 FRACTIONAL SHARES. The Company shall not issue fractions
of Common Shares upon exercise of this Warrant or scrip in lieu thereof. If any
fraction of a Common Share would, except for the provisions of this Paragraph
3.9, be issuable upon exercise of this Warrant, the Company shall in lieu
thereof pay to the person entitled thereto an amount in cash equal to the
product of such fraction, calculated to the nearest one-hundredth (1/100), and
the Market Price of a Common Share as of such date of exercise.
<PAGE>
12
3.10 OFFICER'S STATEMENT AS TO ADJUSTMENTS. Whenever the
Purchase Price shall be adjusted as provided in Section 3 hereof, the Company
shall forthwith file at the office designated for the exercise of this Warrant,
a statement, signed by the Chairman of the Board, the President, any Vice
President or the Treasurer of the Company, showing in reasonable detail the
facts requiring such adjustment and the Purchase Price that will be effective
after such adjustment. The Company shall also cause a notice setting forth any
such adjustments to be sent by mail, first class, postage prepaid, to the record
holder of this Warrant at his or its address appearing on the Warrant register
of the Company. If such notice relates to an adjustment resulting from an event
referred to in Paragraph 3.6, such notice shall be included as part of the
notice required to be mailed and published under the provisions of Paragraph 3.6
hereof.
4. NO DILUTION OR IMPAIRMENT. The Company shall not, by amendment of
its charter or through reorganization, consolidation, merger, dissolution, sale
of assets or any other voluntary action, avoid or seek to avoid the observance
or performance of any of the terms of this Warrant, but will at all times in
good faith assist in the carrying out of all such terms and in the taking of all
such action as may be necessary or appropriate in order to protect the rights of
the holder hereof against dilution or other impairment. Without limiting the
generality of the foregoing, the Company shall not increase the par value of any
Common Shares receivable upon the exercise of this Warrant above the amount
payable therefor upon such exercise, and at all times will take all such action
as may be necessary or appropriate in order that the Company may validly and
legally issue fully paid and non-assessable Common Shares upon the exercise of
this Warrant.
5. RESERVATION OF COMMON SHARES, ETC., ISSUABLE UPON EXERCISE OF
WARRANTS. The Company shall at all times reserve and keep available out of its
authorized but unissued Common Shares, solely for the issuance and delivery upon
the exercise of this Warrant and other similar Warrants, such number of its duly
authorized Common Shares as from time to time shall be issuable upon the
exercise of this Warrant and all other similar Warrants at the time outstanding.
6. REPLACEMENT OF WARRANT. Upon receipt of evidence reasonably
satisfactory to the Company of the loss, theft, destruction or mutilation of
this Warrant and (in the case of loss, theft or destruction) upon delivery of an
indemnity agreement (which surety if reasonably required) in an amount
reasonably satisfactory to it, or (in the case of mutilation) upon surrender and
cancellation thereof, the Company shall issue, in lieu thereof, a new Warrant of
like tenor.
7. REMEDIES. The Company stipulates that the remedies at law of the
holder of this Warrant in the event of any default by the Company in the
performance of or compliance with any of the terms of this Warrant are not and
will not be adequate, and that the same may be specifically enforced.
<PAGE>
13
8. NEGOTIABILITY, ETC. This Warrant is issued upon the following
terms to all of which each taker or owner hereof consents and agrees:
(a) This Warrant and the Common Shares issuable upon
exercise of this Warrant (the "Underlying Shares") may not be transferred except
(i) in compliance with the provisions of the Bye-laws of the Company and any
applicable state securities or "blue sky" laws and (ii)(a) pursuant to an
effective registration under the Securities Act of 1933, as amended (the "Act"),
(b) in compliance with Rule 144 under the Act, (c) inside the United States to a
"qualified institutional buyer" as defined in and in compliance with Rule 144A
under the Act, (d) outside the United States in compliance with Rule 904 of
Regulation S under the Act or (e) inside the United States to an institutional
"accredited investor" as defined in Rule 501(a) (1), (2), (3) or (7) under the
Act in a transaction which, in the opinion of counsel reasonably satisfactory to
the Company, qualifies as an exempt transaction under the Act and the rules and
regulations promulgated thereunder. This Warrant and the Underlying Shares are
subject to certain additional restrictions on transfer contained in a
Subscription Agreement and the Company's Bye-laws, copies of which are on file
at the principal office of the Company.
The provisions of this Section 8 shall be binding upon any transferee of this
Warrant and upon each holder of Underlying Shares.
(b) Subject to the limitations described in this
Paragraph 8, title to this Warrant may be transferred by endorsement (by the
holder hereof executing the form of assignment at the end hereof including
guaranty of signature) and delivery in the same manner as in the case of a
negotiable instrument transferable by endorsement and delivery.
(c) Any person in possession of this Warrant properly
endorsed and, if not the original holder hereof, to whom possession was
transferred in accordance with the provisions of Paragraphs 8(a) and (b) is
authorized to represent himself as absolute owner hereof and is granted power to
transfer absolute title hereto by endorsement and delivery hereof to a bona fide
purchaser hereof for value; each prior taker or owner waives and renounces all
of his equities or rights in this Warrant in favor of every such bona fide
purchaser, and every such bona fide purchaser shall acquire title hereto and to
all rights represented hereby.
(d) Until this Warrant is transferred on the books of
the Company, the Company may treat the registered holder of this Warrant as the
absolute owner hereof for all purposes without being affected by any notice to
the contrary.
(e) The Company shall not be required to pay any Bermuda
or U.S. Federal or state transfer tax or charge that may be payable in respect
of any transfer involved in the transfer or delivery of this Warrant or the
issuance or
<PAGE>
14
conversion or delivery of certificates for Common Shares in a name other than
that of the registered holder of this Warrant or to issue or deliver any
certificates for Common Shares upon the exercise of this Warrant until any and
all such taxes and charges shall have been paid by the holder of this Warrant or
until it has been established to the Company's satisfaction that no such tax or
charge is due.
9. NO RIGHTS TO VOTE OR RECEIVE DIVIDENDS OR OTHER DISTRIBUTIONS.
Prior to the exercise of this Warrant, the holder hereof shall not be entitled
to any rights of a shareholder of the Company with respect to Common Shares for
which this Warrant shall be exercisable, including, without limitation, the
right to vote, to receive dividends or other distributions or to exercise any
preemptive rights, and shall not be entitled to receive any notice of any
proceedings of the Company, except as provided herein.
10. MAILING OF NOTICES, ETC. All notices and other communications
from the Company to the holder of this Warrant shall be mailed by firsts-class
certified mail, postage prepaid, to the address furnished to the Company in
writing by the last holder of this Warrant who shall have furnished an address
to the Company in writing.
11. CHANGE, WAIVER, ETC. The terms of this Warrant may not be
changed, waived, discharged or terminated orally but only by an instrument in
writing signed by the holder of this Warrant against which enforcement of the
change, waiver, discharge or termination is sought.
ESG RE LIMITED
By:
--------------------------------
Name: Wolfgang M. Wand
Title: Chief Executive Officer
Dated: December __, 1997
<PAGE>
[To be signed only upon transfer of Warrant]
FOR VALUE RECEIVED, the undersigned hereby sells, assigns and
transfers unto ______________________________________ the within Warrant and
appoints _________________________________attorney to transfer said right on the
books of ESG Re Limited with full power of substitution in the premises.
Dated:
_________________
_____________________________
(Signature must conform in all
respects to name of Holder as
specified on the face of the
Warrant)
_____________________________
Address
In the presence of
_________________
<PAGE>
[To be signed only upon exercise of Warrant]
To ESG Re Limited
The undersigned, the holder of the within Warrant hereby irrevocably
elects to exercise the purchase right represented by such Warrant for, and to
purchase thereunder, _____________ Common Shares of ESG Re Limited and herewith
makes payment of $ _____________ therefor and/or requests that the number of
Common Shares for which the within Warrant is exercisable be reduced by ________
Common Shares (in addition to the Common Shares being purchased) and/or delivers
Common Shares, the aggregate of such payment being equal to the aggregate
purchase price for the Common Shares being purchased, and requests that the
certificates for the Common Shares being purchased be issued in the name of,
and be delivered to, _________________ whose address is ________________________
_______________________________ .
Dated:
_________________
_____________________________
(Signature must conform in all
respects to name of Holder as
specified on the face of the
Warrant)
_____________________________
Address
Exhibit 5.2
[Appleby, Spurling & Kempe Letterhead]
DRL/lb
8 January 1998
ESG Re Limited
Skandia International House
16 Church Street
Hamilton HM 11
Bermuda
Dear Sirs,
RE: ESG RE LIMITED (THE "COMPANY")
We have acted as special Bermuda counsel to the Company with respect to the
Registration Statement, as filed with the Securities and Exchange Commission on
November 17, 1997, on Form F-1 (Registration No. 333-40341), and all amendments
thereto (collectively, the "Registration Statement") under the Securities Act of
1933 of the United States of America, as amended (the "Act"), and the Rules and
Regulations promulgated thereunder (the "Rules"). We have also acted as special
Bermuda counsel to the Company with respect to the Registration Statement as
filed with the Securities and Exchange Commission on 12 January 1998 on Form S-8
(the "S-8 Registration Statement").
We have examined copies of the following documents: -
1
<PAGE>
i) the Registration Statement;
ii) the S-8 Registration Statement;
iii) the ESG Re Limited Non-Management Directors' Compensation and Option Plan;
iv) the ESG Re Limited 1997 Stock Option Plan (each of items iii) and iv) are
hereinafter referred to as the "Plans");
v) certified copies of the Memorandum of Association and Bye-laws of the
Company;
iv) certified copies of the Minutes of the meeting of the Board of Directors of
the Company held on 3 December 1997 (the "Resolutions") approving, inter alia,
the Plans.
We have also relied upon our searches of documents of public record maintained
by the Registrar of Companies in Bermuda and of the Cause Book of the Supreme
Court of Bermuda in respect of the Company, in each case made on 7 January 1998,
(collectively, the "Searches").
We have assumed: -
i) the genuineness of all signatures on the documents which we have examined;
ii) the conformity to original documents of all document produced to us as
copies, and the authenticity of all original documents which or copies of which
have been submitted to us;
iii) the truth, accuracy and completeness as of the date hereof of all recitals,
warranties and representations as to factual matters made in all documents,
including official public records, which we have relied upon for the purpose of
rendering this opinion;
2
<PAGE>
iv) that there are no provisions of the laws of any jurisdiction, other than
Bermuda, which would have any implication in relation to any of the opinions
expressed herein;
v) and that the information disclosed by the Searches was complete and accurate
at the time the Searches were effected and has not been materially altered and
that the Searches did not fail to disclose any material information which had
been delivered for filing or registration, but was not disclosed or did not
appear on the public file at the time of the Searches; and
vi) that the truth, accuracy and completeness of all representations and
warranties as to factual matters made in the Resolutions, that the Resolutions
are a full and accurate record of resolutions duly executed by the Directors,
and that the Resolutions have not been amended or rescinded and are in full
force and effect.
We have made no investigation of and express no opinion in relation to the laws
of any jurisdiction other than Bermuda, nor do we express any opinion in
relation to any company other than the Company. This opinion is to be governed
by and construed in accordance with the laws of Bermuda.
Based upon and subject to the foregoing, and subject to the reservations set out
below and any matters not disclosed to us, we are of the opinion that the Common
Shares of the Company, when issued, delivered and paid for as contemplated in
the Registration Statement, the S-8 Registration Statement and the Plans, will
be duly authorized, validly issued, fully paid and non-assessable. The term
"non-assessable is not a term of art in Bermuda; however, for the purposes of
this opinion non-assessable means that all calls in regard of capital monies
which may be made in respect of the Shares (as contemplated in the Registration
Statement, the S-8 Registration Statement and the Plans) have been made, and
have been satisfied.
Our reservations are as follows: -
3
<PAGE>
A) We express no opinion as to any law other than Bermuda law in force at the
date hereof, and none of the opinions expressed herein relates to compliance
with, or matters governed by, the laws of any jurisdiction except Bermuda.
B) Where an obligation is to be performed in a jurisdiction other than Bermuda,
a Bermuda Court may decline to enforce it to the extent that such performance
would be illegal or contrary to public policy under the laws of such other
jurisdiction.
C) Any provision providing that certain calculations or certificates or opinions
will be conclusive and binding will not be effective if such calculations,
certificates or opinions are fraudulent or erroneous on their face, and will not
necessarily prevent inquiry into the merits of any claim by an aggrieved party.
D) We express no opinion as to the availability of equitable remedies, such as
specific performance or injunctive relief, or as to any matters which are within
the discretion of the courts of Bermuda, such as the award of costs, or question
related to jurisdiction. Further, we express no opinion as to the validity or
binding effect in Bermuda of any waiver of or obligation to waive any provision
of law (whether substantive or procedural) or any right or remedy arising
through circumstances not known at the time of entering into the Plans.
We hereby specifically consent to the use of this opinion as on the exhibit to
the S-8 Registration Statement. In giving this consent, we do not thereby admit
that we come within the category of persons whose consent is required by the Act
or the Rules.
This opinion is issued on the basis that it will be construed in accordance with
provisions of Bermuda law and will not give rise to any action in any
jurisdiction other than Bermuda. This opinion is issued in connection with and
solely for the purpose of the transactions contemplated by the Plans, the
Registration Statement, and the S-8 Registration Statement. Save as provided for
in the paragraph above, this opinion is being delivered to the addressees and
their respective
4
<PAGE>
legal counsel, who may rely on it for the purposes of their opinions to be given
to the addressees.
Yours faithfully,
/s/ Appleby, Spurling & Kempe
APPLEBY, SPURLING & KEMPE
5
Exhibit 23.1
[Letterhead of Deloitte & Touche]
Consent of Independent Auditors and Tax Advisors
We consent to the incorporation by reference in this Registration
Statement on Form S-8 (the "S-8") of our report dated August 15, 1997 on the
consolidated financial statement of European Specialty Group GmbH and
Subsidiaries appearing in Registration Statement No. 333-40341 on Form F-1 of
ESG Re Limited (the "F-1") and the reference to our Firm under the heading
"Experts" in the F-1. We also consent to the incorporation by reference in the
S-8 of our opinion attached as an exhibit to the F-1 and the reference to our
Firm under the heading "Certain Tax Considerations" in the F-1.
/s/ Deloitte & Touche Wirtschaftsprufungsgesellschaft
Deloitte & Touche
Wirtschaftsprufungsgesellschaft
Hamburg, Germany
January 5, 1998
Exhibit 23.2
[Letterhead of Deloitte & Touche]
January 5, 1998
The Board of Directors
ESG Re Limited
c/o Paul, Weiss, Rifkind, Wharton & Garrison
1285 Avenue of the Americas
New York, NY 10019-6064
USA
We consent to the incorporation by reference in this Registration
Statement on Form S-8 of our report dated August 28, 1997 of our audits of the
financial statements and schedule of ESG Re Limited appearing in Registration
Statement No. 333-40341 on Form F-1 of ESG Re Limited.
Very Truly Yours,
/s/ Deloitte & Touche
