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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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RULE 13E-3/A TRANSACTION STATEMENT
(AMENDMENT NO. 2 - FINAL AMENDMENT)
(Pursuant to Section 13(e) of the Securities Exchange Act of 1934)
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Capital Re Corporation
(Name of the Issuer)
ACE Limited
(Name of Person(s) Filing Statement)
Common Stock
par value $0.01 per share
(Title of Class of Securities)
140432 105
(CUSIP Number of Class of Securities)
Alan S. Roseman Peter N. Mear
Capital Re Corporation General Counsel & Secretary
1325 Avenue of the Americas The ACE Building
New York, New York 10019 30 Woodbourne Avenue
(212) 974-0100 Hamilton HM 08, Bermuda
(441) 295-5200
(Name, Address and Telephone Number of Person Authorized to
Receive Notices and Communications on Behalf of Persons Filing Statement)
with copies to:
Michael J. Silver Edward S. Best
Hogan & Hartson L.L.P. Mayer, Brown & Platt
111 South Calvert Street 190 South LaSalle Street
Baltimore, Maryland 21202 Chicago, Illinois 60603
(410) 659-2700 (312) 782-0600
This statement is filed in connection with (check the appropriate box):
a. [ ] The filing of solicitation materials or an information statement
subject to Regulation 14A, Regulation 14C or Rule 13e-3(c) under
the Securities Act of 1934.
b. [X] The filing of a registration statement under the Securities Act of
1933.
c. [ ] A tender offer.
d. [ ] None of the above.
Check the following box if the soliciting materials or information statement
referred to in checking box (a) are preliminary copies: [ ]
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INTRODUCTION
This Amendment No. 2 - Final Amendment to Schedule 13E-3 Transaction
Statement (the "Statement") is being filed by ACE Limited ("Purchaser"), a
Cayman Islands company. Purchaser holds approximately 15.9% of the outstanding
shares of common stock, par value $0.01 per share (the "Shares"), of Capital Re
Corporation, a Delaware corporation (the "Company"). This Statement relates to
a proposed merger (the "Merger") in which the Company would merge with and into
CapRe Acquisition Corp., a Delaware corporation (the "Merger Sub") and a wholly
owned subsidiary of Purchaser, and the Shares, other than those Shares held by
Purchaser, would be converted into 0.65 of a Purchaser ordinary share plus a
cash payment equal to the difference between the market value of 0.65 of a
Purchaser ordinary share and $14.00. This Final Amendment No. 2 amends the
Amendment No. 1 to the Schedule 13E-3 Transaction Statement filed on November
29, 1999 and the Schedule 13E-3 Transaction Statement filed on November 12,
1999. Except as expressly set forth in this Final Amendment, all information in
the Transaction Statement remains unchanged.
This Final Amendment is being filed with the Securities and Exchange
Commission pursuant to the requirements of Rule 13e-3(d)(3) promulgated under
the Securities and Exchange Act of 1934, as amended, to report the results of
the Merger. The Company, which was a party to the Transaction Statement, is not
a party hereto because it no longer exists as a result of the Merger, which was
consummated on December 30, 1999. The Merger Sub was the surviving corporation
in the Merger (the "Surviving Corporation"). Except as expressly set forth in
this Final Amendment, all information in the Transaction Statement remains
unchanged.
Item 1. Issuer and Class of Security Subject to the Transaction.
(a) As a result of the consummation of the Merger on December 30, 1999,
each of the 1,000 shares of common stock, par value of $.01 per share, of Merger
Sub (the "Merger Sub Common Stock") issued and outstanding immediately prior to
the effective time of the Merger, remained as one validly issued, fully paid and
nonassessable share, par value $.01 per share, of the Surviving Corporation
("Surviving Corporation Common Stock"). Each Share owned by Purchaser
immediately prior to the effective time of the Merger, as well as each share of
capital stock of the Company that was held in the treasury of the Company
immediately prior to the effective time of the Merger, was canceled and
extinguished without any conversion right thereof and without any consideration
payable therefor. Each Share issued and outstanding immediately prior to the
effective time of the Merger (other than any shares owned by Purchaser or held
in the treasury of the Company) was converted into and represents the right to
receive 0.65 of an ordinary share, par value $0.041666667 per share ("Ordinary
Shares"), of Purchaser and an amount in cash equal to $3.4456, payable to the
holder thereof, without any interest thereon. As of the date hereof, there are
1,000 shares of Surviving Corporation Common Stock issued and outstanding, and
there is one holder of record of such stock.
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As a result of the Merger, the Shares ceased to trade on the New York Stock
Exchange and became eligible for delisting from the New York Stock Exchange and
termination of registration pursuant to Rules 12g-4 and 12h-3 of the Securities
Exchange Act of 1934. Accordingly, the Surviving Corporation has filed a
Certification and Notice of Termination of Registration on Form 15 with the
Securities and Exchange Commission.
Item 4. Terms of the Transaction.
(a) Each Share issued and outstanding immediately prior to the
effective time of the Merger (other than any shares owned by Purchaser or held
in the treasury of the Company) was converted into and represents the right to
receive 0.65 of an Ordinary Share and an amount in cash equal to $3.4456,
payable to the holder thereof, without any interest thereon.
Item 6. Source and Amounts of Funds or Other Consideration.
(a) Purchaser issued approximately 20.8 million Ordinary Shares, and paid
approximately $110.3 million in cash in the Merger.
Item 10. Interest in Securities of the Issuer.
(a) As a result of the consummation of the Merger on December 30, 1999,
Purchaser has acquired the entire equity interest in the Surviving Corporation.
Item 16. Additional Information.
The Merger Agreement was approved by the stockholders of the Company at the
special meeting of the stockholders of the Company held on December 30, 1999
(the "Special Meeting"), and the transactions contemplated by the Merger
Agreement were completed on that date. Of the 38,093,398 Shares outstanding on
the November 26, 1999 record date, 32,110,248 of such Shares (approximately
84.3%) were represented in person or by proxy at the Special Meeting, and
32,022,314 of such Shares (approximately 84.1%) voted in favor of the proposal
to approve the Merger Agreement. The number of shares voted in favor of the
Merger Agreement was sufficient to approve the Merger. On December 30, 1999, a
Certificate of Merger was duly filed with the Secretary of State of the State of
Delaware. The Certificate of Merger also changed the name of Merger Sub to
"Capital Re Corporation." The Merger became effective on that date.
Item 17. Material to be Filed as Exhibits.
(a)-(e) The Exhibit Index attached to this Final Amendment is
incorporated herein by reference.
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SIGNATURES
After due inquiry and to the best of my knowledge and belief, I certify
that the information set forth in this Statement is true, complete and correct.
Dated: January 6, 2000 ACE LIMITED
By: /s/ Peter Mear
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Name: Peter Mear
Title: General Counsel and Secretary
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EXHIBIT INDEX
Exhibit No. Description
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(a) Not Applicable
(b)(1) Opinion of Goldman, Sachs & Co. (attached as Appendix C to the
Proxy Statement/Prospectus)*
(b)(2) Written Presentation Materials of Credit Suisse First Boston
Corporation*
(c)(1) Stock Option Agreement (attached as Appendix B to the Proxy
Statement/Prospectus)
(c)(2) Capital Support Agreement*
(c)(3) Agreement and Plan of Merger, as amended (attached as Appendix A
to the Proxy Statement/Prospectus)
(c)(4) Stockholder Support Agreements*
(d)(1) Proxy Statement/Prospectus*
(d)(2) Capital Re Corporation Annual Report on Form 10-K for the fiscal
year ended December 31, 1999 is incorporated herein by reference
(d)(3) Capital Re Corporation Definitive Proxy Statement on Schedule 14A
filed on April 26, 1999 is incorporated herein by reference
(d)(4) Press Release dated December 30, 1999 regarding completion of the
Merger.
(e) Appraisal Rights under Delaware General Corporation Law (attached
as Appendix D to the Proxy Statement/Prospectus)
* Previously filed
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Exhibit (d)(4)
ACE Limited and Capital Re Announce Closing of Acquisition
HAMILTON, Bermuda--(BUSINESS WIRE)--Dec. 30, 1999--ACE Limited (NYSE:ACL)
and Capital Re Corporation (NYSE:KRE) announced today that ACE has completed the
acquisition of Capital Re. ACE issued approximately 20.8 million ordinary
shares, and paid approximately $110.3 million in cash in the transaction.
Brian Duperreault, chairman and chief executive officer of ACE, said: "This
transaction adds significant depth and expertise to ACE's financial reinsurance
capabilities and represents a strategic complement to our diversified book of
business. The acquisition of Capital Re establishes ACE as one of the premier
financial guaranty reinsurers."
Jerry Jurschak, president and chief executive officer of Capital Re,
commented: "Capital Re is pleased to complete its merger with ACE Limited. Our
positive business environment for reinsuring financial products is significantly
furthered by ACE's broad product offering, substantial balance sheet, and
worldwide presence."
Dominic Frederico has been appointed chairman of Capital Re Corporation,
effective today. In commenting on the transaction, Mr. Frederico said, "Capital
Re will facilitate ACE's product development to meet the diverse needs of
today's marketplace and further enhance our capabilities to address the
convergence of financial products and insurance products."
Capital Re is a specialty reinsurance group providing innovative solutions
to problems of financial risk and risk management. Capital Re's two principal
divisions, financial guaranty and financial risks, are engaged in the business
of municipal and non-municipal financial guaranty reinsurance, mortgage guaranty
reinsurance, title reinsurance, trade credit reinsurance, life, accident &
health, annuity reinsurance and structured financial products.
The ACE Group of Companies provides insurance and reinsurance for a diverse
group of clients. The ACE Group conducts its business on a global basis with
operating subsidiaries in nearly 50 countries. Additional information can be
found at: www.acelimited.com.
CONTACT: ACE Limited, Hamilton
Investor:
Helen M. Wilson, 441/299-9283
or
Media
Wendy Davis Johnson, 441/299-9347
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Capital Re Corporation, New York
David A. Buzen, 212/974-0100
or
Cathy Bailey, 212/974-0100
