<PAGE>
As filed with the Securities and Exchange Commission on December 22, 2000
File No. 333-
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--------------------------------------------------------------------------------
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
--------------
FORM S-3
REGISTRATION STATEMENT
Under
The Securities Act of 1933
--------------
MARKEL CORPORATION
(Exact name of registrant as specified in charter)
--------------
Virginia
(State or other jurisdiction of incorporation or organization)
54-1959284
(I.R.S. Employer Identification No.)
4521 Highwoods Parkway, Glen Allen, Virginia 23060-6148 (804) 747-0136
(Address, including zip code, and telephone number, including area code, of
registrant's principal executive offices)
--------------
Gregory B. Nevers
Corporate Counsel
Markel Corporation
4521 Highwoods Parkway, Glen Allen, Virginia 23060-6148 (804) 747-0136
(Name, address, including zip code, and telephone number, including area code,
of agent for service)
With a Copy to:
Leslie A. Grandis
McGuireWoods LLP
One James Center
901 East Cary Street, Richmond, Virginia 23219-4030
--------------
Approximate date of commencement of proposed sale to the public: From time
to time after the effective date of this Registration Statement, as determined
by the Registrant.
If the only securities being registered on this Form are being offered
pursuant to dividend or interest reinvestment plans, please check the following
box. [_]
If any of the securities being registered on this Form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or
interest reinvestment plans, check the following box. [X]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following
box and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [_]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [_]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [_]
CALCULATION OF REGISTRATION FEE
<TABLE>
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<CAPTION>
Proposed
Proposed maximum
Title of each class of Amount maximum aggregate Amount of
securities to be to be offering price offering registration
registered registered(1)(2) per unit(1)(2) price(1)(2)(3) fee(4)
-------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Shares..........
Preferred Shares.......
Warrants(5)............
Debt Securities........
Selling Security Holders
Common Shares (6)......
Total:................. $475,000,000 100% $475,000,000 $118,750
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</TABLE>
(1) Such indeterminate number of Common Shares, Preferred Shares, Warrants, and
Debt Securities as may from time to time be issued at indeterminate prices
but with an aggregate initial offering price not to exceed $475,000,000,
plus such indeterminate number of shares of Preferred Shares as may be
issued in exchange for, or upon conversion of, Warrants, Debt Securities,
or other Preferred Shares registered hereunder, and such indeterminate
number of Common Shares as may be issued in exchange for, or upon
conversion of, Warrants, Debt Securities or Preferred Shares registered
hereunder.
(2) Or, if any Debt Securities are issued at original issue discount, such
greater amount as may result in the initial offering prices for Debt
Securities.
(3) Estimated solely for the purpose of calculating the registration fee. Any
offering of Debt Securities denominated in any foreign currency or currency
unit will be treated as the equivalent in U.S. dollars based on the
exchange rate applicable to the purchase of such Debt Securities from the
Registrant.
(4) Calculated pursuant to Rule 457 of the rules and regulations under the
Securities Act.
(5) Including such indeterminate number of Warrants as may from time to time be
issued at indeterminate prices, representing rights to purchase certain
Common Shares, Preferred Shares or Debt Securities registered hereunder.
(6) There is being registered an indeterminate number of Common Shares as may
be sold from time to time by certain Selling Security Holders. In no event
will the aggregate offering price of all securities sold by the Registrant
and by the Selling Security Holders from time to time pursuant to this
registration statement exceed $475,000,000.
The Registrant hereby amends this Registration Statement on such date or
dates as may be necessary to delay its effective date until the Registrant
shall file a further amendment which specifically states that this Registration
Statement shall thereafter become effective in accordance with Section 8(a) of
the Securities Act of 1933 or until the Registration Statement shall become
effective on such date as the Securities and Exchange Commission, acting
pursuant to said Section 8(a), may determine.
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<PAGE>
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
+The information in this prospectus is not complete and may be changed. We may +
+not sell these securities until the registration statement filed with the +
+Securities and Exchange Commission is effective. This prospectus is not an +
+offer to sell these securities and it is not soliciting an offer to buy these +
+securities in any state where the offer or sale is not permitted. +
++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++++
Subject to Completion, Dated December 22, 2000
PROSPECTUS
$475,000,000
Markel Corporation
Common Shares, Preferred Shares, Warrants, And Debt Securities
------------
From time to time we may offer and sell common shares, preferred shares,
warrants, and debt securities. We will provide specific terms of these
securities in supplements to this prospectus. The terms of the securities will
include the initial offering price, aggregate amount of the offering, listing
on any securities exchange or quotation system, investment considerations and
the agents, dealers or underwriters, if any, to be used in connection with the
sale of these securities. You should read this prospectus and any supplement
carefully before you invest.
In addition, some of our common shares covered by this prospectus may be
offered by selling security holders.
Our common shares are traded on the New York Stock Exchange under the symbol
"MKL."
------------
Neither the Securities and Exchange Commission nor any state securities
commission has approved or disapproved of these securities, or determined if
this prospectus is truthful or complete. Any representation to the contrary is
a criminal offense.
------------
The date of this prospectus is December , 2000.
<PAGE>
You should rely only on the information contained in or incorporated by
reference in this prospectus and in any prospectus supplement. We have not
authorized anyone to provide you with different information. We are not making
an offer of these securities in any state where the offer is not permitted. You
should not assume that the information contained in or incorporated by
reference in this prospectus is accurate as of any date other than the date on
the front of this prospectus.
Table Of Contents
<TABLE>
<CAPTION>
Page
----
<S> <C>
About This Prospectus......................................................
Where You Can Find More Information About The Company...................... 1
Incorporation Of Information We File With The SEC.......................... 1
Note On Forward-Looking Statements......................................... 2
The Company................................................................ 3
Unaudited Pro Forma Condensed Financial Information........................ 3
Investment Considerations.................................................. 7
Ratio Of Earnings To Fixed Charges......................................... 8
Use Of Proceeds............................................................ 8
Description Of Capital Stock............................................... 8
Description Of Warrants.................................................... 10
Description Of Debt Securities............................................. 12
Plan Of Distribution....................................................... 20
Selling Security Holders................................................... 21
Legal Matters.............................................................. 22
Experts.................................................................... 22
</TABLE>
About This Prospectus
This prospectus is part of a registration statement that we filed with the
Securities and Exchange Commission using a "shelf" registration process. Under
the shelf process, we may sell any combination of the securities described in
this prospectus in one or more offerings up to a total dollar amount of
$475,000,000. This prospectus provides you with a general description of the
securities we may offer. Each time we sell securities, we will provide a
prospectus supplement that will contain specific information about the terms of
that offering. The prospectus supplement may also add, update or change
information contained in this prospectus. You should read both this prospectus
and any prospectus supplement, together with additional information described
under the heading "Where You Can Find More Information About The Company."
<PAGE>
Where You Can Find More Information About The Company
We are subject to the informational reporting requirements of the Securities
Exchange Act of 1934, which requires us to file annual, quarterly and special
reports, proxy statements and other information with the Securities and
Exchange Commission. You may read and copy any document that we file at the
Public Reference Room of the SEC at 450 Fifth Street, N.W., Washington, D.C.
20549. Information on the operation of the Public Reference Room may be
obtained by calling the SEC at 1-800-SEC-0330. You may also inspect our filings
at the regional offices of the SEC located at Citicorp, 500 West Madison
Street, Suite 1400, Chicago, Illinois 60661 and 7 World Trade Center, New York,
New York 10048, or over the Internet at the SEC's home page at
http://www.sec.gov.
Our common shares are listed on the New York Stock Exchange under the symbol
"MKL." Our reports, proxy statements and other information may also be read and
copied at the New York Stock Exchange at 30 Broad Street, New York, NY 10005.
Incorporation Of Information We File With The SEC
The SEC allows us to "incorporate by reference" the information we file with
them, which means that we can disclose important information to you by
referring you to those documents. The information incorporated by reference is
considered to be part of this prospectus, and later information that we file
with the SEC will automatically update and supersede this information and the
information in the prospectus. We incorporate by reference the documents listed
below and any future filings made with the SEC under Sections 13(a), 13(c), 14
or 15(d) of the Securities Exchange Act of 1934 until we sell all of the
securities covered by this prospectus:
Markel Corporation (Formerly Markel Holdings, Inc.) SEC Filings (File No.
001-15811):
1. Our Annual Report on Form 10-K for the year ended December 31,
1999;
2. Our Quarterly Reports on Form 10-Q for the quarters ended March 31,
2000, June 30, 2000, and September 30, 2000 (as amended by Form 10-
Q/A on November 13, 2000);
3. Our Current Reports on Form 8-K dated March 24, 2000, April 14,
2000, June 2, 2000, and June 14, 2000;
4. The description of our Capital Stock contained in our Form 8-A
filed on April 7, 2000 under Section 12(b) of the Securities
Exchange Act of 1934; and
5. The description of our Contingent Value Rights contained in our
Form S-4 filed on February 7, 2000 under the Securities Act of 1933
(Registration No. 333-88609).
Markel Corporation (now Markel North America, Inc.) SEC Filings (File No. 1-
13051):
1. Annual Report on Form 10-K for the year ended December 31, 1999.
Terra Nova (Bermuda) Holdings Ltd. (acquired on March 24, 2000) SEC Filings
(File No. 1-13834):
1. Annual Report on Form 10-K for the year ended December 31, 1999.
2. Quarterly Reports on Form 10-Q for the quarters ended March 31,
2000, June 30, 2000, and September 30, 2000;
3. Current Reports on Form 8-K filed on April 10, 2000, April 21,
2000, and May 5, 2000.
You may request a copy of these filings at no cost, by writing or
telephoning the office of Investor Relations, Markel Corporation, 4521
Highwoods Parkway, Glen Allen, Virginia 23060, telephone: (804) 747-0136, or e-
mail Bruce Kay, Vice President of Investor Relations at [email protected].
1
<PAGE>
Note On Forward-Looking Statements
This prospectus contains or incorporates by reference forward-looking
statements. Forward-looking statements may be identified by the use of terms
such as "believes," "expects," "estimate," "may," "intends," "plan," "will,"
"should" or "anticipates" or the negative thereof or similar expressions, or by
discussions of strategy. We have based our forward-looking statements on our
current expectations and projections about future events. These forward-looking
statements are subject to risks, uncertainties, and assumptions about us,
including:
. uncertainties and changes in government policy, regulatory policy,
statutory law or case law with respect to our companies, brokers or
customers which can impede our ability to charge adequate rates and
efficiently allocate capital;
. the occurrence of man-made or natural catastrophic events;
. changing legal and social trends and the inherent uncertainties of the
reserving process;
. loss of the services of any of our executive officers;
. initiatives underway at Markel International to reorganize business units
and to evaluate reinsurance programs and exposures which could lead to
additional changes and expense;
. the impact of US tax laws on our foreign subsidiaries;
. changing rates of inflation and other economic conditions;
. losses due to foreign currency exchange rate fluctuations;
. ability to collect reinsurance recoverables;
. changes in the availability, cost or quality of reinsurance;
. developments in domestic and international financial markets that could
affect our investment portfolios;
. changes in the distribution or placement of risks due to increased
consolidation of insurance and reinsurance brokers; and
. the effects of mergers, acquisitions and divestitures.
We undertake no obligation to publicly update or revise any forward-looking
statements, whether as a result of new information, future events or otherwise.
In light of these risks, uncertainties and assumptions, the forward-looking
events discussed in this prospectus or in any supplement to this prospectus
might not occur. Readers are cautioned not to place undue reliance on any
forward-looking statements, which speak only as at their dates.
2
<PAGE>
The Company
General
We market and underwrite specialty insurance products and programs to a
variety of niche markets. In each of these markets, we seek to provide quality
products and excellent customer service so that we can be a market leader. Our
financial goals are to earn consistent underwriting profits and superior
investment returns to build shareholder value.
On March 24, 2000, we completed our acquisition of Terra Nova (Bermuda)
Holdings Ltd. As a result, we realigned our operations with Terra Nova becoming
our international division, Markel International, and our existing U.S.
operations becoming Markel North America. The acquisition was accounted for as
a purchase transaction and accordingly, Markel International has been included
in our operating results since the date of acquisition.
Markel North America includes the excess and surplus lines segment which is
comprised of four underwriting units and the specialty admitted segment which
consists of two underwriting units. The excess and surplus lines segment writes
property and casualty insurance for nonstandard and hard-to-place risks
including catastrophe exposed property, professional liability, products
liability, general liability, commercial umbrella and other coverages tailored
for unique exposures. The specialty admitted segment writes risks that are
unique and hard to place in the standard market but must remain with an
admitted insurance company for marketing and regulatory reasons. These
underwriting units write specialty program insurance for well-defined niche
markets and personal and commercial property and liability coverages.
Markel International includes two segments: the London Company Market and
the Lloyd's Market. The London Company Market consists of the operations of
Terra Nova Insurance Company Limited. The Lloyd's Market includes Markel
Capital Limited, which is the corporate capital provider for four Lloyd's
syndicates managed by Markel Syndicate Management Limited. Markel
International's operating units write specialty property, casualty, marine and
aviation insurance and reinsurance on a worldwide basis. The majority of Markel
International's business comes from the United Kingdom and United States.
Unaudited Pro Forma Condensed Financial Information
The following unaudited pro forma condensed financial information is based
on the historical consolidated statements of operations of Markel for the year
ended December 31, 1999 and the nine months ended September 30, 2000 adjusted
to give effect to the March 24, 2000 acquisition of Terra Nova assuming the
acquisition had occurred on January 1, 1999. The pro forma adjustments are
based upon available information and certain assumptions that management
believes are reasonable.
The acquisition of Terra Nova was accounted for using the purchase method of
accounting. The purchase price for the acquisition was allocated to tangible
and identifiable intangible assets and liabilities based upon management
estimates of their fair value with the excess of purchase price over fair value
of net assets acquired allocated to goodwill and amortized over 20 years. For
purposes of presenting pro forma results, no changes in revenues and expenses
have been made to reflect the results of any modification to operations that
might have been made had the acquisition been consummated on the assumed
effective date of the acquisition.
The unaudited pro forma condensed financial information does not purport to
represent what Markel's results of operations would actually have been had the
acquisition in fact occurred on January 1, 1999 or to project Markel's results
of operations for or at any future period or date.
3
<PAGE>
MARKEL CORPORATION
Pro Forma Condensed Consolidated Statement of Operations
Nine Months Ended September 30, 2000
(in thousands, except per share data)
(Unaudited)
<TABLE>
<CAPTION>
Markel and
Markel Terra Nova Pro Forma Terra Nova
(historical) (historical)* Adjustments Pro Forma
------------ ------------- ----------- ----------
<S> <C> <C> <C> <C>
OPERATING REVENUES
Earned premiums............ $ 655,344 $ 142,833 $ -- $ 798,177
Net investment income...... 110,818 20,177 (1,769)A 129,226
Net realized losses from
investment sales.......... (3,462) (3,212) -- (6,674)
Other...................... 141 1,765 -- 1,906
--------- --------- --------- ---------
Total operating revenues... 762,841 161,563 (1,769) 922,635
--------- --------- --------- ---------
OPERATING EXPENSES
Losses and loss adjustment
expenses.................. 511,883 148,119 660,002
Underwriting, acquisition
and insurance expenses.... 236,295 54,078 290,373
Amortization of intangible
assets.................... 15,979 672 4,937 B 21,588
--------- --------- --------- ---------
Total operating expenses... 764,157 202,869 4,937 971,963
--------- --------- --------- ---------
Operating loss............. (1,316) (41,306) (6,706) (49,328)
Interest expense........... 37,235 2,862 5,209 C 45,306
--------- --------- --------- ---------
Loss before income taxes... (38,551) (44,168) (11,915) (94,634)
Income taxes............... (19,180) (21,822) 3,754 D (37,248)
--------- --------- --------- ---------
Loss from continuing
operations................ $ (19,371) $ (22,346) $ (15,669) $ (57,386)
========= ========= ========= =========
Loss from continuing
operations per share:
Basic.................... $ (2.85) -- -- $ (7.87)
========= ========= ========= =========
Diluted.................. $ (2.85) -- -- $ (7.87)
========= ========= ========= =========
Weighted average shares:
Basic.................... 6,793 -- -- 7,290
========= ========= ========= =========
Diluted.................. 6,793 -- -- 7,290
========= ========= ========= =========
</TABLE>
--------
* Represents the period from January 1, 2000 through March 23, 2000. Terra Nova
was acquired by Markel Corporation on March 24, 2000 and is included in
Markel's results of operations since that date.
See accompanying Notes to Unaudited Pro Forma Condensed Consolidated Statements
of Operations.
4
<PAGE>
MARKEL CORPORATION
Pro Forma Condensed Consolidated Statement of Operations
Year Ended December 31, 1999
(in thousands, except per share data)
(Unaudited)
<TABLE>
<CAPTION>
Markel and
Markel Terra Nova Pro Forma Terra Nova
(historical) (historical) Adjustments Pro Forma
------------ ------------ ----------- ----------
<S> <C> <C> <C> <C>
OPERATING REVENUES
Earned premiums............ $ 437,196 $ 585,281 $ -- $1,022,477
Net investment income...... 87,681 93,829 (7,075)A 174,435
Net realized gains (losses)
from investment sales..... (897) 26,879 -- 25,982
Other...................... 341 3,016 -- 3,357
--------- --------- --------- ----------
Total operating revenues... 524,321 709,005 (7,075) 1,226,251
--------- --------- --------- ----------
OPERATING EXPENSES
Losses and loss adjustment
expenses.................. 283,630 491,243 -- 774,873
Underwriting, acquisition
and insurance expenses.... 156,703 273,875 -- 430,578
Amortization of intangible
assets.................... 5,398 4,089 19,583 B 29,070
--------- --------- --------- ----------
Total operating expenses... 445,731 769,207 19,583 1,234,521
--------- --------- --------- ----------
Operating income (loss).... 78,590 (60,202) (26,658) (8,270)
Interest expense........... 25,150 12,400 21,557 C 59,107
--------- --------- --------- ----------
Income (loss) before income
taxes..................... 53,440 (72,602) (48,215) (67,377)
Income taxes............... 12,826 (37,628) 10,786 D (14,016)
--------- --------- --------- ----------
Income (loss) from
continuing operations..... $ 40,614 $ (34,974) $ (59,001) $ (53,361)
========= ========= ========= ==========
Income (loss) from
continuing operations per
share:
Basic.................... $ 7.27 -- -- $ (7.30)
========= ========= ========= ==========
Diluted.................. $ 7.20 -- -- $ (7.30)
========= ========= ========= ==========
Weighted average shares:
Basic.................... 5,585 -- -- 7,312
========= ========= ========= ==========
Diluted.................. 5,638 -- -- 7,312
========= ========= ========= ==========
</TABLE>
See accompanying Notes to Unaudited Pro Forma Condensed Consolidated Statements
of Operations.
5
<PAGE>
Notes to Unaudited Pro Forma Condensed Consolidated Statements of Operation
1. Basis of presentation
On March 24, 2000, Markel acquired Terra Nova. The Unaudited Pro Forma
Condensed Statements of Operations and related Notes were prepared based on
consideration to each Terra Nova shareholder of $13.00 in cash, .07027 of a
Markel common share and .07027 of a Markel contingent value right (CVR).
Consideration exchanged consisted of the following (in thousands, except per
share data):
<TABLE>
<S> <C>
Cash.............................................................. $356,500
Markel common shares and Markel contingent value rights issued to
Terra Nova shareholders (1,769 shares at $148.00 per share and
1,769 contingent value rights at $19.00 per right)............... 295,482
--------
Total purchase consideration...................................... 651,982
Direct costs of acquisition....................................... 6,423
--------
Total cost of acquisition......................................... 658,405
Less: Fair value of Terra Nova net tangible and identifiable
intangible assets as of purchase date............................ 356,097
--------
Excess of cost over fair value of net assets acquired............. $302,308
========
The acquisition was funded as follows (in thousands):
Available cash.................................................... $117,923
Borrowings under $400 million credit facility..................... 245,000
Markel common shares and CVRs issued to Terra Nova shareholders... 295,482
--------
Total cost of acquisition......................................... $658,405
========
</TABLE>
The accompanying Unaudited Pro Forma Condensed Consolidated Statements of
Operations are provided to illustrate the effect of the acquisition on Markel
and have been prepared using the purchase method of accounting. These unaudited
financial statements reflect how the statements of operations for the year
ended December 31, 1999 and for the nine months ended September 30, 2000 might
have appeared had the acquisition of Terra Nova been consummated on January 1,
1999. Certain reclassifications of Terra Nova's historical financial statements
have been made to conform with Markel's historical presentation.
2. Adjustments
The accompanying Unaudited Pro Forma Condensed Consolidated Statements of
Operations for the year ended December 31, 1999 and for the nine months ended
September 30, 2000 reflect certain adjustments which are explained below and
are based on assumptions made by management. These adjustments are required to
give effect to matters directly attributable to the acquisition. The
explanations of these adjustments are as follows:
(A) Reduction in net investment income due to net cash used in funding the
transaction; the rate of return is calculated at 6%. The 6% rate of
return is based on historical average yields for the Company's
investment portfolio.
(B) Excess of cost over fair value of net assets acquired is amortized on a
straight line basis over 20 years. The estimated life of the business
acquired was determined based on the value of the Lloyd's franchise,
the investment portfolio's earning power and profitable books of
business acquired, as well as the capital requirements and other
barriers to entering the business acquired.
(C) Interest on borrowed funds under revolving lines of credit is assumed
to be 7.84% which is calculated as LIBOR plus 1.25% as specified in the
credit facility. For the year ended December 31, 1999, a change of 1/8
percent in the interest rate would result in a change in interest
expense and income
6
<PAGE>
(loss) from continuing operations of $0.3 million and $0.2 million
before and after taxes, respectively. For the nine months ended
September 30, 2000, a change of 1/8 percent in the interest rate would
result in a change in interest expense and income (loss) from continuing
operations of $0.2 million and $0.2 million before and after taxes,
respectively. In addition, a fair value adjustment for Terra Nova's long
term debt (based on an independent third party quote) is amortized over
the remaining lives of those debt instruments.
(D) Taxes on the reduction in net investment income and interest expense
pro forma adjustments are calculated at an assumed 35% statutory rate.
In addition, as a result of the merger, Terra Nova's operations will be
subject to taxation in the United States. Taxes have been recorded for
Terra Nova in accordance with United States tax regulations assuming
the transaction had occurred on January 1, 1999.
Investment Considerations
In addition to the matters addressed in the section entitled "Note On
Forward-Looking Statements" and other information included or incorporated in
this document, interested investors should consider the following investment
considerations in determining whether to purchase securities described in this
prospectus.
Loss Reserves
Significant periods of time often elapse between the occurrence of an
insured loss, the reporting of the loss to the insurer and the insurer's
payment of that loss. To recognize liabilities for unpaid losses, insurers
establish reserves as balance sheet liabilities representing estimates of
amounts needed to pay reported and unreported losses and the related loss
adjustment expense. The process of estimating loss reserves is a difficult and
complex exercise involving many variables and subjective judgments. As part of
the reserving process, insurers review historical data and consider the impact
of various factors such as changes in operations (including underwriting or
claims handling), trends in claim frequency and severity, emerging economic
and social trends, inflation and changes in the regulatory and litigation
environments. This process assumes that past experience, adjusted for the
effects of current developments and anticipated trends, is an appropriate
basis for predicting future events. There is no precise method, however, for
evaluating the impact of any specific factor on the adequacy of reserves, and
actual results are likely to differ from original estimates.
Catastrophes
Property and casualty insurance companies frequently experience losses from
catastrophes. Catastrophes may have a material adverse effect on operations.
Catastrophes include windstorms, hurricanes, earthquakes, tornadoes, hail,
severe winter weather and fires. An insurer cannot predict how severe a
particular catastrophe may be until after it occurs. The extent of losses from
catastrophes is a function of the total amount of losses incurred, the number
of insureds affected, the frequency of the events and the severity of the
particular catastrophe. Most catastrophes occur in small geographic areas.
However, windstorms, hurricanes and earthquakes may produce significant damage
in large, heavily populated areas.
Regulatory Environment
Our insurance subsidiaries are subject to supervision and regulation by the
insurance regulatory authorities in the various jurisdictions in which they
conduct business. Regulation is intended for the benefit of policyholders
rather than shareholders or holders of debt securities. Insurance regulatory
authorities have broad regulatory, supervisory and administrative powers
relating to solvency standards, licensing, policy rates and forms and the form
and content of financial reports. Regulatory actions may affect our ability to
implement our business objectives. Also, payment of dividends by our insurance
subsidiaries may require prior regulatory notice or approval.
7
<PAGE>
Investment Markets
We receive premiums from customers for insuring their risks. We invest these
funds until they are needed to pay policyholder claims or until they are
recognized as profits. Many of the policies we issue are denominated in foreign
currencies. Fluctuations in the value of our investment portfolio can occur as
a result of changes in interest rates, government monetary policies and general
economic conditions. Our investment results may be impacted by these factors.
Other
Markel International is continuing initiatives to reorganize business units
to achieve operating efficiencies and to evaluate reinsurance programs and
exposures. These initiatives could lead to additional changes and expense for
Markel International. In addition, our international operations are subject to
foreign currency risk and taxation in the U.S. We anticipate that our effective
tax rate will increase due to the way that taxes on foreign subsidiaries are
calculated for U.S. tax purposes.
Ratio Of Earnings To Fixed Charges
All of the information we provide below that corresponds to the years 1995
through the end of 1999 are based on the historical results of our predecessor,
now known as Markel North America. The 2000 results we provide below include
Terra Nova since its acquisition by us on March 24, 2000.
The following table sets forth the ratio of earnings to fixed charges for
each of the last five fiscal years and for the nine month period ended
September 30, 2000.
<TABLE>
<CAPTION>
Nine Months
Ended Year Ended December 31,
September 30, ------------------------
2000 1999 1998 1997 1996 1995
------------- ---- ---- ---- ---- ----
<S> <C> <C> <C> <C> <C> <C>
Ratio of Earnings to Fixed Charges.. 0.0 3.0 4.4 4.1 5.2 6.3
Deficiency in the coverage of fixed
charges by earnings before fixed
charges............................ $38,551 -- -- -- -- --
</TABLE>
The ratio of earnings to fixed charges is computed by dividing pretax income
from continuing operations before fixed charges by fixed charges. Fixed charges
consist of interest charges and amortization of debt expense and discount or
premium related to indebtedness, whether expensed or capitalized, and that
portion of rental expense we believe to be representative of interest.
Use Of Proceeds
Unless otherwise indicated in the applicable prospectus supplement, we will
use the net proceeds from the sale of common shares, preferred shares, warrants
or debt securities to repay or refinance our indebtedness, including our
revolving credit agreement, to fund working capital and capital expenditures,
and for other general corporate purposes, and for acquisitions. We will not
receive any proceeds from the sale of common shares that may be offered by
Selling Security Holders, as defined in the section below entitled "Selling
Security Holders."
Description Of Capital Stock
Our authorized capital consists of 50,000,000 common shares, no par value,
and 10,000,000 preferred shares, no par value. At December 14, 2000, 7,329,468
common shares were outstanding. At that date, no preferred shares were
outstanding.
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Preferred Shares
Our preferred shares are issuable in one or more series from time to time at
the direction of the board of directors. The board of directors is authorized,
with respect to each series, to fix its designation; relative rights, including
voting, dividend, conversion, sinking fund and redemption rights; preferences,
including with respect to dividends and on liquidation; and limitations. The
board of directors, without shareholder approval, can issue preferred shares
with voting and conversion rights that could adversely affect the voting power
of the holders of common shares. This right of issuance could be used as a
method of preventing a party from gaining control of us.
Common Shares
Each holder of our common shares is entitled to one vote for each share held
of record on each matter submitted to a vote of shareholders. Cumulative voting
in the election of directors is not permitted. As a result, the holders of more
than 50% of the outstanding shares have the power to elect all directors. The
quorum required at a shareholders' meeting for consideration of any matter is a
majority of the shares entitled to vote on that matter, represented in person
or by proxy. If a quorum is present, the affirmative vote of a majority of the
shares voting on the matter at the meeting is required for shareholder
approval, except in the case of major corporate actions, such as a merger,
share exchange or dissolution of the Company, an amendment to our articles of
incorporation, or the sale of all or substantially all of our assets, with
respect to which, under the provisions of our articles of incorporation,
approval is required by the affirmative vote of more than two-thirds of all
shares entitled to vote on the matter, whether or not represented at the
meeting. These provisions, together with our ability to issue preferred shares
with disproportionately high voting power could be used to, or have the effect
of, preventing or deterring a party from gaining control of the Company,
whether or not beneficial to public shareholders, and could discourage tactics
that involve an actual or threatened change of control of the Company.
Subject to the rights of any holders of our preferred shares, the holders of
common shares are entitled to receive dividends when, as, and if declared by
the board of directors out of funds legally available for that purpose and, in
the event of liquidation, dissolution or winding up of the Company, to share
ratably in all assets remaining after the payment of liabilities. There are no
preemptive or other subscription rights, conversion rights, or redemption or
sinking fund provisions with respect to common shares. All common shares
outstanding upon the consummation of any offering will be legally issued, fully
paid and nonassessable.
Our transfer agent and registrar for common shares is First Union National
Bank.
Contingent Value Rights
On March 24, 2000, we became a holding company for Markel North America,
Inc. and completed our acquisition of Terra Nova (Bermuda) Holdings, Ltd., now
called Markel International. We issued approximately 1.75 million Markel common
shares and contingent value rights, paid approximately $325 million in cash to
Markel International shareholders in the transaction and purchased 1.1 million
Terra Nova shares for $31.1 million prior to the closing of the transaction.
Each whole contingent value right we issued in the acquisition of Terra Nova
represents the right, on September 24, 2002, if the rights have not previously
been extinguished, to receive, in cash or our common shares, at our option, the
amount, if any, by which the current market value, subject to a minimum or
floor of $140.00 per share, of our common shares is less than $185.00 per
share. The current market value is based upon a formula averaging market prices
during 20 consecutive day trading periods during the 60 days ending on
September 24, 2002. The rights will automatically be extinguished if the
current market value of our common shares is $185 or more for any 20
consecutive trading days prior to September 24, 2002. The contingent value
rights are issued under the Contingent Value Rights Agreement between us and a
trustee, the form of which we have filed as an exhibit to this registration
statement.
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Voting Rights with Respect to Extraordinary Corporate Transactions
Under Virginia law, a corporation may sell, lease, exchange or otherwise
dispose of all, or substantially all, of its property, other than in the usual
and regular course of business, if the proposed transaction is approved by more
than two-thirds of all of the votes entitled to be cast on that matter. A
merger or share exchange plan must be approved by each voting group entitled to
vote separately on the plan by more than two-thirds of all the votes entitled
to be cast on the plan by that voting group. The articles of incorporation may
provide for a greater or lesser vote, but not less than a majority of all the
votes cast on the transaction by each voting group entitled to vote on the
transaction. Our articles of incorporation do not provide for a greater or
lesser vote.
Anti-takeover Statutes
Virginia law, except as to companies that elect not to be covered, prohibits
the following business combinations between a Virginia corporation and any
"interested shareholder:"
. mergers and statutory share exchanges;
. material dispositions of corporate assets not in the ordinary course of
business;
. any dissolution of the corporation proposed by or on behalf of an
interested shareholder; or
. any reclassification, including a reverse stock split, recapitalization
or merger of the corporation with its subsidiaries that increases the
percentage of voting shares beneficially owned by an interested
shareholder by more than 5%.
An interested shareholder is, among others, a person who is, or an affiliate
who was within three years of the transaction, a beneficial owner of more than
10% of any class of the outstanding voting shares of the applicable
corporation. In such a case, unless the affiliated transaction satisfies "fair
price" criteria or comes within an applicable exemption, the affiliated
transaction must be approved by the affirmative vote of a majority of the
disinterested directors and by the affirmative vote of the holders of two-
thirds of the voting shares other than shares beneficially owned by the
interested shareholder. We have not made any election in our articles not to be
covered by this provision of the Virginia law.
Under Virginia law, voting rights for "control shares" must be approved by a
corporation's shareholders, not including the shares held by interested
parties. "Control shares" are shares whose acquisition entitles the acquiror to
between 1/5 and 1/3, between 1/3 and 1/2, or greater than 1/2 of a
corporation's voting power. If a shareholder has acquired control shares with a
majority of all voting power and these shares have been given voting rights,
all other shareholders have dissenters' rights. Virginia law exempts from these
provisions acquisitions where the corporation is a party to the governing
agreement. We have not made any election not to be governed by these provisions
of Virginia law. Our Board of Directors can elect not to be governed by these
provisions at any time before four days after receipt of a control share
acquisition notice.
Insurance Holding Company Regulations on Change of Control
We are regulated as an insurance holding company and are subject to state
and foreign laws that restrict the ability of any person to obtain control of
an insurance holding company without prior regulatory approval. Without such
approval (or an exemption), no person may acquire any voting security of an
insurance holding company which controls an insurance subsidiary, or merge with
such a holding company. "Control" is generally defined as the direct or
indirect power to direct or cause the direction of the management and policies
of a person and is usually presumed to exist if a person directly or indirectly
owns or controls 10% or more of the voting securities of another person.
Description Of Warrants
We may issue warrants for the purchase of debt securities, preferred shares
or common shares. Warrants may be issued independently or together with debt
securities, preferred shares or common shares offered by any
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prospectus supplement and may be attached to or separate from any such offered
securities. Each warrant will entitle the holder to purchase the principal
amount of debt securities or number of shares of preferred stock or common
stock, as the case may be, at the exercise price and in the manner specified in
the prospectus supplement relating to those warrants. Warrants will be issued
under one or more warrant agreements to be entered into between us and a bank
or trust company, as warrant agent. The warrant agent will act solely as our
agent in connection with the warrants and will not assume any obligation or
relationship of agency or trust for or with any holders or beneficial owners of
warrants. If we offer warrants, we will file the warrant agreement relating to
the offered warrants as an exhibit to, or incorporate it by reference in the
registration statement of which this prospectus is a part.
The prospectus supplement relating to a particular issue of warrants will
describe the terms of the warrants, including the following:
. the title of the warrants;
. the offering price for the warrants, if any;
. the aggregate number of the warrants;
. the designation and terms of the securities purchasable upon exercise of
the warrants;
. if applicable, the designation and terms of the securities with which the
warrants are issued and the number of such warrants issued with each
security;
. if applicable, the date from and after which the warrants and any
securities issued therewith will be separately transferable;
. the principal amount of debt securities purchasable upon exercise of a
warrant, if a debt warrant, and the price at which the principal amount
of securities may be purchased upon exercise, which price may be payable
in cash, securities, or other property;
. the date on which the right to exercise the warrants shall commence and
the date on which the right shall expire;
. if applicable, the number of common shares or preferred shares
purchasable upon exercise of a warrant and the price at which the shares
may be purchased upon exercise;
. if applicable, the minimum or maximum amount of the warrants that may be
exercised at any one time;
. the currency or currency units in which the offering price, if any, and
the exercise price are payable;
. if applicable, a discussion of material United States federal income tax
considerations;
. whether the debt warrants represented by the warrant certificates or debt
securities that may be issued upon exercise of the warrants will be
issued in registered or bearer form;
. information with respect to book-entry procedures, if any;
. the currency or currency units in which the offering price, if any, and
the exercise price are payable;
. the antidilution provisions of the warrants, if any;
. the redemption or call provisions, if any, applicable to the warrants;
and
. any additional terms of the warrants, including terms, procedures, and
limitations relating to the exchange and exercise of the warrants.
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Description Of Debt Securities
This section describes the general terms and provisions of the debt
securities which may be offered by us from time to time. The prospectus
supplement will describe the specific terms of the debt securities offered by
that prospectus supplement.
We may issue debt securities either separately or together with, or upon the
conversion of, or in exchange for, other securities. The debt securities are to
be either senior obligations of ours issued in one or more series and referred
to herein as the "Senior Debt Securities," subordinated obligations of ours
issued in one or more series and referred to herein as the "Subordinated Debt
Securities," or our junior subordinated obligations issued in one or more
series and referred to herein as the "Junior Subordinated Debt Securities." The
Senior Debt Securities, the Subordinated Debt Securities and the Junior
Subordinated Debt Securities are collectively referred to as the "Debt
Securities."Debt Securities will be issued pursuant to one or more written
agreements, known as an "Indenture," to be entered into by us and an
independent third party, known as a "Trustee," who will be legally obligated to
carry out the terms of the Indenture. We will issue our Senior Debt Securities
under a Senior Debt Indenture and will issue our Subordinated Debt Securities
and Junior Subordinated Debt Securities under one or more Subordinated Debt
Indentures. Together the Senior Debt Indenture and the Subordinated Debt
Indentures are called "Indentures." The name(s) of the Trustee(s) will be set
forth in the applicable prospectus supplement.
We have summarized certain terms and provisions that will be included in the
Indentures, unless provided otherwise in any applicable prospectus supplement.
The summary is not complete. The form of Senior Debt Indenture is filed as an
exhibit to, or incorporated by reference in the registration statement of which
this prospectus is a part. If we offer any Subordinated Debt Securities or
Junior Debt Securities, we will file the form of Subordinated Debt Indenture as
an exhibit to, or incorporate by reference in the registration statement of
which this prospectus is a part. If we refer to particular provisions of an
Indenture, the provisions, including definitions of certain terms, are
incorporated by reference as a part of this summary. Each Indentures will be
subject to and governed by the Trust Indenture Act of 1939, as amended. You
should refer to the applicable Indenture for the provisions that may be
important to you.
General
The Indentures will not limit the amount of Debt Securities that we may
issue. We may issue Debt Securities up to an aggregate principal amount as we
may authorize from time to time. The applicable prospectus supplement will
describe the terms of any Debt Securities being offered, including, if
applicable:
. the designation, aggregate principal amount and authorized denominations;
. the maturity date or the method for determining the maturity date;
. the interest rate, if any, and the method for calculating the interest
rate and the date or dates from which interest will accrue;
. the interest payment dates and the record dates for the interest
payments;
. any mandatory or optional redemption terms or prepayment, conversion,
sinking fund with respect to the Senior Debt Securities or
exchangeability or convertibility provisions;
. the places, date or dates, and where the principal and interest will be
payable or method for determining such, and any right we have to change
the date on which principal is payable;
. whether the Debt Securities will be issued in the form of Global
Securities, as defined below, or certificates;
. additional provisions, if any, relating to the defeasance and covenant
defeasance of the Debt Securities;
. whether the Debt Securities will be issuable in registered form, referred
to as the "Registered Securities," or bearer form, referred to as the
"Bearer Securities" or both and, if Bearer Securities are issuable, any
restrictions applicable to the exchange of one form for another and the
offer, sale and delivery of Bearer Securities;
. the portion of the principal payable upon acceleration of maturity, if
other than the entire principal;
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. if other than denominations of $1,000 or multiples of $1,000 for
Registered Securities, or denominations of $5,000 for Bearer Securities,
the denominations the Debt Securities will be issued in;
. whether such Debt Securities will be Senior Debt Securities, Subordinated
Debt Securities or Junior Subordinated Debt Securities and, if
Subordinated Debt Securities or Junior Subordinated Debt Securities, the
subordination provisions and the applicable definition of "Senior
Indebtedness;"
. any applicable material U.S. federal tax consequences;
. the dates on which premium, if any, will be payable;
. our right, if any, to defer payment of interest and the maximum length of
such deferral period;
. any listing on a securities exchange;
. if convertible into our common shares or preferred shares, the terms on
which such Debt Securities are convertible;
. the terms, if any, of any guarantee of the payment of principal of, and
premium, if any, and interest on Debt Securities of the series and any
corresponding changes to the provisions of the applicable Indenture as
currently in effect;
. the terms, if any, of the transfer, mortgage, pledge, or assignment as
security for the Debt Securities of the series of any properties, assets,
moneys, proceeds, securities or other collateral, including whether
certain provisions of the Trust Indenture Act are applicable, and any
corresponding changes to provisions of the Indenture as currently in
effect;
. the initial public offering price; and
. other specific terms, including covenants and any additions or changes to
the events of default provided for with respect to the Debt Securities.
If the purchase price of any Debt Securities is payable in a currency other
than U.S. dollars or if principal of, or premium, if any, or interest, if any,
on any of the Debt Securities is payable in any currency other than U.S.
dollars, the specific terms and other information with respect to such Debt
Securities and such foreign currency will be specified in the applicable
prospectus supplement.
Debt Securities may be issued as Original Issue Discount Securities, as
defined in the Indentures, to be sold at a substantial discount below their
principal amount. Original Issue Discount Securities may include "zero coupon"
securities that do not pay any cash interest for the entire term of the
securities. In the event of an acceleration of the maturity of any Original
Issue Discount Security, the amount payable to the holder thereof upon such
acceleration will be determined in the manner described in the applicable
prospectus supplement. Conditions pursuant to which payment of the principal of
the Subordinated Debt Securities may be accelerated will be set forth in the
applicable prospectus supplement. Material federal income tax and other
considerations applicable to Original Issue Discount Securities will be
described in the applicable prospectus supplement.
Under the Indentures, the terms of the Debt Securities of any series may
differ and we, without the consent of the holders of the Debt Securities of any
series, may reopen a previous series of Debt Securities and issue additional
Debt Securities of such series or establish additional terms of such series,
unless otherwise indicated in the applicable prospectus supplement.
Covenants
Under the Indentures, we will be required to:
. pay the principal, interest and any premium on the Debt Securities when
due;
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. maintain a place of payment;
. deliver an officer's certificate to the applicable Trustee within 120
days after the end of each fiscal year confirming our compliance with our
obligations under the applicable Indenture; and
. deposit sufficient funds with any paying agent on or before the due date
for any principal, interest or any premium.
Any additional covenants will be described in the applicable prospectus
supplement.
Registration, Transfer, Payment and Paying Agent
Unless otherwise indicated in a prospectus supplement, each series of Debt
Securities will be issued in registered form only, without coupons. We may also
issue Debt Securities in bearer form only, or in both registered and bearer
form. Bearer Securities shall not be offered, sold, resold or delivered in
connection with their original issuance in the United States or to any United
States person other than to the offices located outside the United States of
certain United States financial institutions. Purchasers of Bearer Securities
will be subject to certification procedures and may be affected by certain
limitations under United States tax laws. Such procedures and limitations will
be described in the prospectus supplement relating to the offering of the
Bearer Securities.
Unless otherwise indicated in a prospectus supplement, Registered Securities
will be issued in denominations of $1,000 or any integral multiple thereof, and
Bearer Securities will be issued in denominations of $5,000.
Unless otherwise indicated in a prospectus supplement, the principal,
premium, if any, and interest, if any, of or on the Debt Securities will be
payable, and Debt Securities may be surrendered for registration of transfer or
exchange, at an office or agency of the Trustee in the Borough of Manhattan,
The City of New York, provided that payments of interest with respect to any
Registered Security may be made at our option by check mailed to the address of
the person entitled to payment or by transfer to an account maintained by the
payee with a bank located in the United States. No service charge shall be made
for any registration of transfer or exchange of Debt Securities, but we may
require payment of a sum sufficient to cover any tax or other governmental
charge and any other expenses that may be imposed in connection with the
exchange or transfer.
Unless otherwise indicated in a prospectus supplement, payment of principal
of, premium, if any, and interest, if any, on Bearer Securities will be made,
subject to any applicable laws and regulations, at such office or agency
outside the United States as specified in the prospectus supplement and as we
may designate from time to time. Unless otherwise indicated in a prospectus
supplement, payment of interest due on Bearer Securities on any interest
payment date will be made only against surrender of the coupon relating to such
interest payment date. Unless otherwise indicated in a prospectus supplement,
no payment of principal, premium or interest with respect to any Bearer
Security will be made at any office or agency in the United States or by check
mailed to any address in the United States or by transfer to an account
maintained with a bank located in the United States; except that if amounts
owing with respect to any Bearer Securities shall be payable in U.S. dollars,
payment may be made at the Corporate Trust Office of the applicable Trustee or
at any office or agency designated by us in the Borough of Manhattan, The City
of New York, if (but only if) payment of the full amount of such principal,
premium or interest at all offices outside of the United States maintained for
such purpose by us is illegal or effectively precluded by exchange controls or
similar restrictions.
Unless otherwise indicated in the applicable prospectus supplement, we will
not be required to:
. issue, register the transfer of or exchange Debt Securities of any series
during a period beginning at the opening of business 15 days before any
selection of Debt Securities of that series of like tenor to be redeemed
and ending at the close of business on the day of that selection;
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. register the transfer of or exchange any Registered Security, or portion
thereof, called for redemption, except the unredeemed portion of any
Registered Security being redeemed in part;
. exchange any Bearer Security called for redemption, except to exchange
such Bearer Security for a Registered Security of that series and like
tenor that is simultaneously surrendered for redemption; or
. issue, register the transfer of or exchange any Debt Security which has
been surrendered for repayment at the option of the holder, except the
portion, if any, of the Debt Security not to be so repaid.
Ranking of Debt Securities; Holding Company Structure
The Senior Debt Securities will be unsubordinated obligations of ours and
will rank equally in right of payment with all other unsubordinated
indebtedness of ours. The Subordinated Debt Securities and Junior Subordinated
Debt Securities will be obligations of ours and will be subordinated in right
of payment to all existing and future Senior Indebtedness. The prospectus
supplement will describe the subordination provisions and set forth the
definition of "Senior Indebtedness" applicable to the Subordinated Debt
Securities or Junior Subordinated Debt Securities, as the case may be, and will
set forth the approximate amount of such Senior Indebtedness outstanding as of
a recent date.
Because we are a holding company that conducts all of our operations through
our subsidiaries, our ability to meet our obligations under the Debt Securities
is dependent on the earnings and cash flows of those subsidiaries and the
ability of those subsidiaries to pay dividends or to advance or repay funds to
us. Holders of Debt Securities will generally have a junior position to claims
of creditors of our subsidiaries, including trade creditors, debt holders,
secured creditors, taxing authorities, guarantee holders and any preferred
stockholders.
Global Securities
The Debt Securities of a series may be issued in whole or in part in the
form of one or more global securities that will be deposited with, or on behalf
of, a "Depositary" identified in the prospectus supplement relating to such
series. Global Debt Securities may be issued in either registered or bearer
form and in either temporary or permanent form. Unless and until it is
exchanged in whole or in part for individual certificates evidencing Debt
Securities, a Global Debt Security may not be transferred except as a whole (1)
by the Depositary to a nominee of such Depositary, (2) by a nominee of such
Depositary to such Depositary or another nominee of such Depositary or (3) by
such Depositary or any such nominee to a successor of such Depositary or a
nominee of such successor.
The specific terms of the depositary arrangement with respect to a series of
Global Debt Securities and certain limitations and restrictions relating to a
series of Global Bearer Securities will be described in the prospectus
supplement.
. the principal amount of a Debt Security denominated in a currency other
than U.S. dollars shall be the U.S. dollar equivalent, determined on the
date of original issue of such Debt Security, of the principal amount of
such Debt Security; and
. any Debt Security owned by us or any obligor on such Debt Security or any
affiliate of us or such other obligor shall be deemed not to be
outstanding.
Redemption and Repurchase
The Debt Securities may be redeemable at our option, in whole or in part,
may be subject to mandatory redemption pursuant to a sinking fund or otherwise,
or may be subject to repurchase by the Company at the option of the holders, in
each case upon the terms, at the times and at the applicable redemption price
together with interest as set forth in the applicable prospectus supplement on
notice given not less than 20 days prior to the date of redemption.
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We must repay the Senior Debt Securities at the option of the Holders prior
to the stated maturity date only if specified in the applicable prospectus
supplement. Unless otherwise provided in the prospectus supplement, the Senior
Debt Securities subject to repayment at the option of the Holder will be
subject to repayment:
. on the specified repayment dates; and
. at a repayment price equal to 100% of the unpaid principal amount to be
repaid, together with unpaid interest accrued to the Repayment Date.
For any Senior Debt Security to be repaid, the Trustee must receive, at its
office maintained for that purpose in the Borough of Manhattan, New York City
not more than 60 nor less than 30 calendar days prior to the date of repayment:
. in the case of a certificated Senior Debt Security, the certificated
Senior Debt Security and the form in the Senior Debt Security entitled
Option of Holder to Elect Purchase duly completed; or
. in the case of a book-entry Senior Debt Security, instructions to that
effect from the beneficial owner to the securities depositary and
forwarded by the securities depositary. Exercise of the repayment option
by the Holder will be irrevocable.
Only the securities depositary may exercise the repayment option in respect
of beneficial interests in the book-entry Senior Debt Securities. Accordingly,
beneficial owners that desire repayment in respect of all or any portion of
their beneficial interests must instruct the participants through which they
own their interests to direct the securities depositary to exercise the
repayment option on their behalf. All instructions given to participants from
beneficial owners relating to the option to elect repayment will be
irrevocable. In addition, at the time the instructions are given, each
beneficial owner will cause the participant through which it owns its interest
to transfer its interest in the book-entry Senior Debt Securites or the global
certificate representing the related book-entry Senior Debt Securities, on the
securities depositary's records, to the Trustee.
Conversion and Exchange
The terms, if any, on which Debt Securities of any series are convertible
into or exchangeable for our common shares, preferred shares, or other Debt
Securities will be set forth in the applicable prospectus supplement. Such
terms may include provisions for conversion or exchange, either mandatory, at
the option of the holders or at our option.
Absence of Limitation on Indebtedness and Liens; Absence of Event Risk
Protection
The applicable prospectus supplement will specify any prohibitions on the
amount of indebtedness, guarantees or other liabilities that may be incurred by
us and any prohibitions on our ability to create or assume liens on our
property. Unless otherwise provided in a prospectus supplement, the Indentures
will not require the maintenance of any financial ratios by, or specified
levels of net worth, revenues, income, cash flow or liquidity of the Company,
and will not contain provisions which would give holders of the Debt Securities
the right to require us to repurchase their Debt Securities in the event of a
takeover, recapitalization or similar restructuring or change in control of the
Company.
Consolidation, Merger and Sale of Assets
Each Indenture generally permits a consolidation or merger (subject to
certain limitations and conditions) between us and another corporation. They
also permit the sale by us of all or substantially all of our property and
assets. If this happens, the remaining or acquiring corporation must assume all
of our responsibilities and liabilities under the Indentures including the
payment of all amounts due on the Debt Securities and performance of the
covenants in the Indentures.
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We are only permitted to consolidate, merge, convey or transfer all or
substantially all of our assets according to the terms and conditions of the
Indentures, unless otherwise indicated in the applicable prospectus supplement.
Unless otherwise indicated in the applicable prospectus supplement, we must
also deliver an opinion of counsel to the applicable Trustee affirming our
compliance with all conditions in the applicable Indenture relating to the
transaction. When the conditions are satisfied, the successor will succeed to
and be substituted for us under the applicable Indenture, and we will be
relieved of our obligations under the applicable Indenture and the Debt
Securities issued under it.
Events of Default
Unless otherwise specified in the applicable prospectus supplement, an Event
of Default with respect to any Debt Securities will include:
. default for a period of 60 days in payment of any interest with respect
to any Debt Security of that series;
. default in payment of principal or any premium with respect to any Debt
Security of that series when due upon maturity, redemption, repurchase at
the option of the holder or otherwise;
. default in deposit of any sinking fund payment when due with respect to
any Debt Security of that series for a period of 60 days;
. default by us in the performance, or breach, of any other covenant or
warranty in the applicable Indenture (other than a covenant or warranty
included therein solely for the benefit of a series of Debt Securities
other than that series) which continues for 90 days after notice to us by
the applicable Trustee or the holders of not less than a fixed percentage
in aggregate principal amount of the Debt Securities of all series issued
under the applicable Indenture;
. certain events of bankruptcy, insolvency or reorganization of us; or
. any other Event of Default that may be set forth in the applicable
prospectus supplement, including, but not limited to, an Event of Default
based on other debt being accelerated, or "cross-acceleration."
No Event of Default with respect to any particular series of Debt Securities
necessarily constitutes an Event of Default with respect to any other series of
Debt Securities. Each Indenture provides that the applicable Trustee thereunder
may withhold notice to the holders of the Debt Securities of any series
outstanding under such Indenture of the occurrence of a default with respect to
the Debt Securities of that series (except a default in payment of principal,
premium, if any, interest, if any, or sinking fund payments, if any) if the
Trustee considers it in the interest of the holders to do so.
Each Indenture provides that if an Event of Default with respect to any
series of Debt Securities issued thereunder shall have occurred and be
continuing, either the relevant Trustee or the holders of at least a fixed
percentage in principal amount of the Debt Securities of such series then
outstanding may declare the principal amount (or if any Debt Securities of such
series are Original Issue Discount Securities, such lesser amount as may be
specified in the applicable prospectus supplement) of all the Debt Securities
of such series to be due and payable immediately, but upon certain conditions
such declaration and its consequences may be rescinded and annulled by the
holders of a majority in principal amount of the Debt Securities of all series
issued under the applicable Indenture.
The applicable prospectus supplement will provide the terms pursuant to
which an Event of Default shall result in acceleration of the payment of
principal of Subordinated Debt Securities or Junior Subordinated Debt
Securities.
In the case of a default in the payment of principal of, or premium, if any,
or interest, if any, on any Subordinated Debt Securities or Junior Subordinated
Debt Securities of any series, the applicable Trustee, subject to certain
limitations and conditions, may institute a judicial proceeding for the
collection thereof.
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No holder of any of the Debt Securities of any series issued under any
Indentures has any right to institute any proceeding with respect to that
Indenture or any remedy thereunder, unless the holders of at least a fixed
percentage in principal amount of the outstanding Debt Securities of such
series have made written request, and offered reasonable indemnity, to the
applicable Trustee to institute such proceeding as Trustee, the applicable
Trustee has failed to institute such proceeding within 60 days after receipt of
such notice and the applicable Trustee has not within such 60-day period
received directions inconsistent with such written request by holders of a
majority in principal amount of the outstanding Debt Securities of such series.
Such limitations do not apply, however, to a suit instituted by a holder of a
Debt Security for the enforcement of the payment of the principal of, premium,
if any, or any accrued and unpaid interest on, the Debt Security on or after
the respective due dates expressed in the Debt Security.
Subject to the provisions of the applicable Indenture relating to the duties
of the applicable Trustee, if an Event of Default occurs and is continuing, the
applicable Trustee is not under any obligation to exercise any of its rights or
powers under the Indenture at the request or direction of any of the holders
unless those holders have offered to the applicable Trustee reasonable security
or indemnity. Subject to certain provisions concerning the rights of the
applicable Trustee, the holders of a majority in principal amount of the
outstanding Debt Securities of any series have the right to direct the time,
method and place of conducting any proceeding for any remedy available to the
Trustee, or exercising any trust, or power conferred on the applicable Trustee
with respect to that series.
The applicable Trustee may withhold notice to the holders of Debt Securities
of any default (except in the payment of principal or interest) if it considers
the withholding of notice to be in the best interests of the holders. Other
than its duties in case of a default, a Trustee is not obligated to exercise
any of its rights or powers under the Indentures at the request, order or
direction of any holders, unless the holders offer the Trustee reasonable
indemnity. If they provide this reasonable indemnification, the holders of a
majority in principal amount of any series of Debt Securities may direct the
time, method and place of conducting any proceeding or any remedy available to
the applicable Trustee, or exercising any power conferred upon the applicable
Trustee, for any series of Debt Securities.
We are required to furnish to the Trustees annually a statement as to
compliance with all conditions and covenants under the Indentures.
Modification and Waivers
From time to time, we, when authorized by resolutions of our board of
directors, and the applicable Trustee, without the consent of the holders of
Debt Securities of any series, may amend, waive or supplement the Indentures
and the Debt Securities of such series for certain specified purposes,
including, among other things:
. to cure ambiguities, defects or inconsistencies;
. to provide for the assumption of our obligations to holders of the Debt
Securities of such series in the case of a merger, consolidation,
conveyance or transfer;
. to add to our Events of Default or our covenants or to make any change
that would provide any additional rights or benefits to the holders of
the Debt Securities of that series;
. to add or change any provisions of such Indenture to facilitate the
issuance of Bearer Securities;
. to establish the form or terms of Debt Securities of any series and any
related coupons;
. to secure the Debt Securities of that series;
. to maintain the qualification of the Indentures under the Trust Indenture
Act;
. to make any change that does not adversely affect the rights of any
holder;
. to appoint a successor trustee; or
. to make provisions with respect to conversion or exchange rights of
holders.
18
<PAGE>
Other amendments and modifications of the Indentures or the Debt Securities
issued thereunder may be made by us and the applicable Trustee with the consent
of the holders of not less than a majority of the aggregate principal amount of
the outstanding Debt Securities of each series affected thereby, with each
series voting as a separate class; provided that no such modification or
amendment may, without the consent of the holder of each outstanding Debt
Security affected thereby:
. reduce the principal amount of, or change the stated maturity of the
principal of, or reduce the rate or modify the calculation of the rate of
interest of the Debt Securities or any additional amounts with respect
thereto, or any premium payable upon the redemption or repayment thereof
or otherwise, or change our obligation to pay additional amounts; or
. reduce the amount of the principal of an Original Issue Discount Security
that would be due and payable upon a declaration of acceleration of the
maturity thereof, or the amount thereof provable in bankruptcy; or
. adversely affect the right of repayment at the option of any holder of
the Debt Securities; or
. change the place of payment, currency in which the principal of, any
premium or interest on, or any additional amounts with respect to Debt
Securities are payable; or
. impair the right of any holder of the Debt Securities to institute suit
for the enforcement of any payment on the Debt Securities or after the
stated maturity thereof, or, in the case of redemption, on or after the
redemption date or, in the case of repayment at the option of any holder
of the Debt Securities, on or after the repayment date; or
. reduce the percentage in principal amount of the outstanding Debt
Securities of any series, the consent of whose holder is required for any
such supplemental indenture, or the consent of whose holder is required
for any waiver of certain defaults hereunder and their consequences
provided for in the Indentures; or
. reduce the requirements of quorum or voting under the Indentures; or
. make any change that adversely affects the right to convert or exchange
any of the Debt Securities for capital stock or other securities in
accordance with its terms; or
. modify the above provisions, except as permitted by the applicable
Indenture.
The holders of a majority in aggregate principal amount of the outstanding
Debt Securities of any series may waive compliance by us with certain
restrictive provisions of the relevant Indenture, including any other
restrictive covenants, if any, that may be set forth in the applicable
prospectus supplement. The holders of a majority in aggregate principal amount
of the outstanding Debt Securities of any series may, on behalf of all holders
of Debt Securities of that series, waive any past default under the applicable
Indenture with respect to Debt Securities of that series and its consequences,
except a default in the payment of the principal of, or premium, if any, or
interest, if any, on any Debt Securities of such series or in respect of a
covenant or provision which cannot be modified or amended without the consent
of a larger fixed percentage or by the holder of each outstanding Debt
Securities of the series affected.
Satisfaction; Discharge
We may discharge all of our obligations (except those described below) to
holders of the Debt Securities issued under the Indentures, which Debt
Securities have not already been delivered to the applicable Trustee for
cancellation and which either have become due and payable or are by their terms
due and payable within one year, or are to be called for redemption within one
year, by depositing with the applicable Trustee an amount certified to be
sufficient to pay when due the principal, interest and premium, if any, on all
outstanding Debt Securities. However, certain of our obligations under the
Indentures will survive, including with respect to the following:
. remaining rights to register the transfer, conversion, substitution or
exchange of Debt Securities of the applicable series;
19
<PAGE>
. rights of holders to receive payments of principal of, and any interest
on, the Debt Securities of the applicable series, and other rights,
duties and obligations of the holders of Debt Securities with respect to
any amounts deposited with the applicable Trustee; and
. the rights, obligations and immunities of the applicable Trustee under
the applicable Indenture.
Defeasance
We will be discharged from our obligations on the Debt Securities of any
series at any time if we deposit with the applicable Trustee sufficient cash or
government securities to pay the principal, interest, any premium and any other
sums due to the stated maturity date or a redemption date of the Debt
Securities of the series. If this happens, the holders of the Debt Securities
of the series will not be entitled to the benefits of the applicable Indenture
except for registration of transfer and exchange of Debt Securities and
replacement of lost, stolen or mutilated Debt Securities.
Under federal income tax law as of the date of this prospectus, a discharge
may be treated as an exchange of the related Debt Securities. Each holder might
be required to recognize gain or loss equal to the difference between the
holder's cost or other tax basis for the Debt Securities and the value of the
holder's interest in the trust. Holders might be required to include as income
a different amount than would be includable without the discharge. We urge
prospective investors to consult their own tax advisers as to the consequences
of a discharge, including the applicability and effect of tax laws other than
the federal income tax law.
Governing Law
The Indentures and the Debt Securities will be governed by, and construed in
accordance with, the laws of the State of New York.
Regarding the Trustees
The Trust Indenture Act contains limitations on the rights of a trustee,
should it become a creditor of ours, to obtain payment of claims in certain
cases or to realize on certain property received by it in respect of those
claims, as security or otherwise. Each Trustee is permitted to engage in other
transactions with us and our subsidiaries from time to time, provided that if
that Trustee acquires any conflicting interest it must eliminate that conflict
upon the occurrence of an Event of Default under the relevant Indenture, or
else resign.
The Chase Manhattan Bank is the Trustee under the Senior Indenture. We and
certain of our affiliates maintain banking relationships with The Chase
Manhattan Bank. The Chase Manhattan Bank also serves as trustee under other
indentures pursuant to which securities of ours and of certain of our
affiliates are outstanding. It has purchased, and is likely to purchase in the
future, our securities and securities of our affiliates. The Chase Manhattan
Bank administers its corporate trust business at 450 West 33rd Street, New
York, New York 10001 (Attention: Capital Markets Fiduciary Services).
Plan Of Distribution
A prospectus supplement will set forth the terms of the offering of the
securities offered by that prospectus supplement, including:
. the name or names of any underwriters and the respective amounts of such
securities underwritten or purchased by each of them;
. the initial public offering price of those securities and the proceeds to
us, if any, and any discounts, commissions or concessions allowed or paid
to dealers;
. any securities exchanges on which those securities may be listed; and
. the number of common shares to be sold by the selling security holders,
as defined in the section below entitled "Selling Security Holders," if
any.
20
<PAGE>
Only underwriters named in such prospectus supplement are deemed to be
underwriters in connection with the securities offered by that prospectus
supplement.
If underwriters are used in the sale of any securities, those securities
will be acquired by the underwriters for their own account and may be resold
from time to time in one or more transactions, including negotiated
transactions, at a fixed public offering price or at varying prices determined
at the time of sale. Those securities may be either offered to the public
through underwriting syndicates represented by managing underwriters, or
directly by underwriters. Unless otherwise set forth in the applicable
prospectus supplement, the obligations of the underwriters to purchase those
securities will be subject to conditions precedent and the underwriters will
be obligated to purchase all of those securities if any are purchased. Any
initial public offering price and any discounts or concessions allowed or paid
to dealers may be changed from time to time.
The securities may be sold directly by us or through agents designated by
us from time to time. Any agent involved in the offer or sale of the
securities in respect of which a prospectus supplement is delivered will be
named, and any commissions payable by us to such agent will be set forth, in
the prospectus supplement. Unless
otherwise indicated in the prospectus supplement, any agent will be acting on
a best efforts basis for the period of its appointment.
If so indicated in the applicable prospectus supplement, we will authorize
underwriters, dealers or agents to solicit offers by institutional investors
to purchase the securities from us at the public offering price set forth in
the prospectus supplement pursuant to delayed delivery contracts providing for
payment and delivery on a specified date in the future. There may be
limitations on the minimum amount that may be purchased by any institutional
investor or on the portion of the aggregate principal amount of the particular
securities that may be sold pursuant to those arrangements. Institutional
investors to which offers may be made, when authorized, include commercial and
savings banks, insurance companies, pension funds, investment companies,
educational and charitable institutions, and other institutions approved by
us, if applicable. The obligations of any purchasers pursuant to delayed
delivery and payment arrangements will be subject only to those conditions set
forth in the prospectus supplement, and the prospectus supplement will set
forth the commission payable for solicitation of those contracts. Underwriters
will not have any responsibility in respect of the validity of those
arrangements or the performance of the Company or those institutional
investors.
Securities offered other than our common shares may be a new issue of
securities with no established trading market. Any underwriters to whom those
securities are sold by us for public offering and sale may make a market in
those securities, but those underwriters will not be obligated to do so and
may discontinue any market making at any time without notice. No assurance can
be given as to the liquidity of or the trading markets for those securities.
Selling security holders, as described in the section below entitled
"Selling Security Holders," may sell their common shares, and this prospectus
may be delivered in conjunction with those sales. We will not receive any
proceeds from the sale of common shares by the selling security holders.
Agents and underwriters may be entitled under agreements entered into with
us to indemnification by us against certain civil liabilities, including
liabilities under the Securities Act of 1933, or to contribution with respect
to payments which the agents or underwriters may be required to make in
respect thereof. Agents and underwriters may be customers of, engage in
transactions with, or perform services for us in the ordinary course of
business.
Selling Security Holders
The selling security holders may be certain holders of our common stock.
The prospectus supplement for any offering of the common stock by selling
security holders will include the following information:
. the name of each selling security holder;
21
<PAGE>
. the nature of any positions, offices or other material relationships the
selling security holders have had within the past three years with us or
any of our predecessors or affiliates;
. the amount of common shares owned by the selling security holder prior to
the offering, as well as the amount to be offered for the selling
security holder's account; and
. the amount and, if one percent (1%) or more, the percentage of the common
shares to be owned by the selling security holder after the completion of
the offering.
Legal Matters
The validity of the securities in respect of which this prospectus is being
delivered will be passed on for us by McGuireWoods LLP, Richmond, Virginia.
Leslie A. Grandis, a partner in McGuireWoods LLP is Secretary and a member of
the Board of Directors of our company. As of December 18, 2000, partners of
McGuireWoods LLP owned 27,423 of our common shares, or less than 1% of our
common shares outstanding on that date.
Experts
The consolidated financial statements of Markel Corporation, now Markel
North America, as of December 31, 1999 and December 31, 1998 and for each of
the years in the three-year period ended December 31, 1999 and the financial
statements of Markel Holdings, Inc., now Markel Corporation, as of December 31,
1999 and for the period from August 25, 1999, inception, through December 31,
1999 have been incorporated by reference herein in reliance upon the reports of
KPMG LLP, independent certified public accountants, incorporated by reference
herein, and upon the authority of such firm as experts in accounting and
auditing.
The consolidated financial statements of Terra Nova (Bermuda) Holdings, Ltd.
as of December 31, 1999 and December 31, 1998 and for each of the years in the
three-year period ended December 31, 1999 have been incorporated by reference
herein in reliance upon the report of PricewaterhouseCoopers, independent
certified public accountants, incorporated by reference herein, and upon the
authority of such firm as experts in accounting and auditing.
22
<PAGE>
Part II
Information Not Required In The Prospectus
Item 14. Other Expenses Of Issuance And Distribution.
<TABLE>
<S> <C>
Registration fee to the Securities and Exchange Commission............ $118,750
Printing expenses..................................................... $ 50,000
Accounting fees and expenses.......................................... $ 20,000
Legal fees and expenses............................................... $ 50,000
New York Stock Exchange Listing Fee................................... $ 5,000
Miscellaneous expenses................................................ $ 11,250
--------
Total............................................................... $255,000
</TABLE>
The foregoing items, except for the registration fee to the Securities and
Exchange Commission, are estimated.
Item 15. Indemnification Of Directors And Officers.
Virginia law provides that, unless limited by its articles of incorporation,
a corporation shall indemnify a director or officer who entirely prevails in
the defense of any proceeding to which he was a party because he is or was a
director or officer of the corporation against reasonable expenses incurred by
him in connection with the proceeding.
Virginia law permits a corporation to indemnify, after a determination has
been made that indemnification of the director is permissible in the
circumstances because he has met the following standard of conduct, an
individual made a party to a proceeding because he is or was a director against
liability incurred in the proceeding if:
. he conducted himself in good faith;
. he believed in the case of conduct in his official capacity with the
corporation, that his conduct was in its best interests and in all other
cases that his conduct was at least not opposed to its best interests;
and
. in the case of any criminal proceeding, he had no reasonable cause to
believe his conduct was unlawful.
A Virginia corporation, however, may not indemnify a director in connection
with a proceeding by or in the right of the corporation in which the director
was adjudged liable to the corporation or in connection with any other
proceeding charging improper personal benefit to him, whether or not involving
action in his official capacity, in which he was adjudged liable on the basis
that personal benefit was improperly received by him.
In addition, Virginia law permits a corporation to make any further
indemnity, including indemnity with respect to a proceeding by or in the right
of the corporation, and to make additional provision for advances and
reimbursement of expenses, to any director, officer, employee or agent that may
be authorized by the articles of incorporation or any bylaw made by the
shareholders or any resolution adopted by the shareholders, except an indemnity
against his willful misconduct or a knowing violation of the criminal law.
Our Articles of Incorporation provide mandatory indemnification of officers
and directors to the full extent permitted by Virginia law.
We maintain directors' and officers' liability which may provide
indemnification, including indemnification against liabilities under the
Securities Act of 1933 as amended, to our officers and directors in certain
circumstances.
II-1
<PAGE>
Limitations on Director Liability
Virginia law provides that a director is not liable to the corporation, its
shareholders, or any person asserting rights on behalf of the corporation or
its shareholders for liabilities arising from a breach of, or failure to
perform, any duty resulting solely from his or her status as director, unless
the person asserting liability proves that the breach or failure to perform was
in violation of the director's duty to discharge his duties as a director,
including his duties as a member of a committee, in accordance with his good
faith business judgment of the best interests of the corporation, provided,
that the director, unless he has knowledge or information concerning the matter
in question that makes reliance unwarranted, is entitled to rely on
information, opinions, reports or statements, including financial statements
and other financial data, if prepared or presented by:
. one or more officers or employees of the corporation whom the director
believes, in good faith, to be reliable and competent in the matters
presented;
. legal counsel, public accountants, or other persons as to matters the
director believes, in good faith, are within the person's professional or
expert competence; or
. a committee of the board of directors of which he is not a member if the
director believes, in good faith, that the committee merits confidence.
In addition, Virginia law provides that in any proceeding brought by or in
the right of a corporation or brought by or on behalf of shareholders of the
corporation, the damages assessed against an officer or director arising out of
a single transaction, occurrence or course of conduct shall not exceed the
lesser of:
. the monetary amount, including the elimination of liability, specified in
the articles of incorporation or, if approved by the shareholders, in the
bylaws; or
. the greater of $100,000 or the amount of cash compensation received by
the officer or director from the corporation during the twelve months
immediately preceding the act or omission for which liability was
imposed.
Our articles of incorporation provide for the elimination of liability of
officers and directors in every instance permitted under Virginia law. The
liability of an officer or director is not limited if the officer or director
engaged in willful misconduct or a knowing violation of the criminal law or of
any federal or state securities law, including any claim of unlawful insider
trading or manipulation of the market for any security.
II-2
<PAGE>
Item 16. Exhibits And Financial Statement Schedules.
(A) Exhibits
<TABLE>
<CAPTION>
Exhibit
Number Description
------- ----------------------------------------------------------------------
<C> <S>
1.1 Form of Underwriting Agreement**
3.1 Amended and Restated Certificate of Incorporation of Markel
Corporation (incorporated by reference to Exhibit 3(i) of the
Company's Quarterly Report on Form 10-Q for the quarterly period ended
March 31, 2000).
3.2 Bylaws of Markel Corporation (incorporated by reference to Exhibit 4.2
of the Company's Registration Statement on Form S-4 filed as of
October 7, 1999 (Registration No. 333-88609)).
4.1 Form of Contingent Value Rights Agreement from Markel Holdings, Inc.
to Trustee (incorporated by reference to Exhibit 4.3 of the Company's
Registration Statement on Form S-4 filed on February 7, 2000
(Registration No. 333-88609)).
4.2 Form of Indenture between Markel Corporation and The Chase Manhattan
Bank.
4.3 Registration Rights Agreement among Markel Corporation and DLJ
Offshore Partners, C.V.; DLJMB Overseas Partners, C.V.; DLJ Merchant
Banking Funding, Inc.; DLJ First ESC, L.P.; Donaldson, Lufkin &
Jenrette Securities Corporation; Marsh & Mclennan Capital, Inc.; and
John J. Byrne dated as of August 15, 1999 (incorporated by reference
to Exhibit 99.4 of Markel Corporation's (now Markel North America)
Current Report on Form 8-K filed on August 20, 1999).
5 Opinion of McGuireWoods LLP regarding the legality of the securities
being registered.***
12 Statement re Computation of Ratios.
23.1 Consent of KPMG LLP.
23.2 Consent of PricewaterhouseCoopers.
23.3 Consent of McGuireWoods LLP (contained in Exhibit 5).***
24.1 Power of Attorney from officers and directors.
25.1 Form T-1 Statement of Eligibility under the Trust Indenture Act of
1939, as amended, of The Chase Manahattan Bank, as Trustee under the
Indenture.
</TABLE>
--------
* To be filed by amendment to the Registration Statement or incorporated by
reference from documents filed with the SEC under the Securities Exchange
Act of 1934.
** To be incorporated by reference herein in connection with the offering of
each series of securities.
*** To be filed by a pre-effective amendment to the Registration Statement.
(B) Financial Data Schedules.
None.
II-3
<PAGE>
Item 17. Undertakings.
Insofar as indemnification for liabilities arising under the Securities Act
of 1933 may be permitted to directors, officers or persons controlling the
Registrant pursuant to the provisions described under Item 15, or otherwise,
the Registrant has been informed that in the opinion of the Securities and
Exchange Commission such indemnification is against public policy as expressed
in the Securities Act of 1933 and is therefore unenforceable. In the event that
a claim for indemnification against these 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 this 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
this indemnification by it is against public policy as expressed in the
Securities Act and will be governed by the final adjudication of this issue.
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:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising after the
effective date of this Registration Statement (or the most recent
post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set
forth in this Registration Statement. Notwithstanding the
foregoing, any increase or decrease in volume of securities
offered (if the total dollar value of securities offered would not
exceed that which was registered) and any deviation from the low
or high end of the estimated maximum offering range may be
reflected in the form of prospectus filed with the Securities and
Exchange Commission pursuant to Rule 424(b) under the Securities
Act of 1933 if, in the aggregate, the changes in volume and price
represent no more than a 20% change in the maximum aggregate
offering price set forth in the "Calculation of Registration Fee"
table in the effective Registration Statement;
(iii) 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;
provided, however, that paragraphs (1)(i) and (1)(ii) do not apply
if the information required to be included in a post-effective
amendment by those paragraphs is contained in periodic reports filed
by the Registrant pursuant to Section 13 or Section 15(d) of the
Securities Exchange Act of 1934 that are incorporated by reference
in the Registration Statement.
(2) That, for the purpose of determining any liability under the Securities
Act of 1933, 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 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 of 1933, each filing of the
Registrant's annual report pursuant to section 13(a) or section 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
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.
II-4
<PAGE>
The undersigned Registrant hereby undertakes (1) to use its best efforts to
distribute prior to the opening of bids, to prospective bidders, underwriters,
and dealers, a reasonable number of copies of a prospectus which at that time
meets the requirements of section 10(a) of the Act, and relating to the
securities offered at competitive bidding, as contained in the registration
statement, together with any supplements thereto, and (2) to file an amendment
to the registration statement reflecting the results of bidding, the terms of
the reoffering and related matters to the extent required by the applicable
form, not later than the first use, authorized by the issuer after the opening
bids, of a prospectus relating to the securities offered at competitive
bidding, unless no further public offering of such securities by the issuer and
no reoffering of such securities by the purchasers is proposed to be made.
The undersigned Registrant hereby undertakes that:
(1) For purposes of determining any liability under the Securities Act of
1933, the information omitted from the form of prospectus filed as part
of this registration statement in reliance upon Rule 430A and contained
in a form of prospectus filed by the Registrant pursuant to Rule
424(b)(1) or (4) or 497(h) under the Securities Act shall be deemed to
be part of this registration statement as of the time it was declared
effective.
(2) For the purpose of determining any liability under the Securities Act
of 1933, each post-effective amendment that contains a form of
prospectus 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.
The undersigned Registrant hereby undertakes to file an application for the
purpose of determining the eligibility of the trustee to act under subsection
(a) of Section 310 of the Trust Indenture Act (the "Act") in accordance with
the rules and regulations prescribed by the Commission under Section 305(b)(2)
of the Act.
II-5
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the Registrant
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-3 and has duly caused this registration
statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Richmond, State of Virginia, on December 20, 2000.
Markel Corporation
/s/ Darrell D. Martin
By: _________________________________
Darrell D. Martin
Title: Executive Vice President
and Chief Financial Officer
(Principal Financial
Officer,Principal Accounting
Officer)
<TABLE>
<CAPTION>
Signature Title
--------- -----
<S> <C>
/s/ Alan I. Kirshner* Director, Chairman and Chief Executive
___________________________________________ Officer
Alan I. Kirshner (Principal Executive Officer)
/s/ Anthony F. Markel* President, Director
___________________________________________
Anthony F. Markel
/s/ Steven A. Markel* Vice-Chairman, Director
___________________________________________
Steven A. Markel
/s/ Darrell D. Martin Director, Executive Vice President and
___________________________________________ Chief Financial Officer (Principal
Darrell D. Martin Financial Officer, Principal Accounting
Officer)
Director
___________________________________________
John J. Byrne
/s/ Mark J. Byrne* Director
___________________________________________
Mark J. Byrne
/s/ Leslie A. Grandis* Director
___________________________________________
Leslie A. Grandis
/s/ Stewart M. Kasen* Director
___________________________________________
Stewart M. Kasen
/s/ Gary L. Markel* Director
___________________________________________
Gary L. Markel
</TABLE>
II-6
<PAGE>
<TABLE>
<CAPTION>
Signature Title
--------- -----
<S> <C>
/s/ Thomas S. Gayner* Director
___________________________________________
Thomas S. Gayner
</TABLE>
/s/ Gregory B. Nevers
*By: ________________________________
Gregory B. Nevers
Attorney-in-fact
II-7
