New
Registration Statement By Foreign Issuer – Business Combinations (form F-4)
As filed with the Securities and Exchange Commission on March14, 2025
Registration No. 333-
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM F-4
REGISTRATION STATEMENT
UNDER
THE SECURITIES ACT OF 1933
| Fairfax Financial Holdings Limited | Allied World Assurance Company Holdings, Ltd |
| (Exact name of registrant as specified in its charter) | (Exact name of registrant as specified in its charter) |
| Canada (State or other jurisdiction of incorporation or organization) |
Bermuda (State or other jurisdiction of incorporation or organization) |
|
Not Applicable 6331 |
98-1603554 551112 |
| 95 Wellington Street West, Suite 800 M5J 2N7 Toronto, Ontario (416) 367-4941 |
27 Richmond Road Pembroke HM 08 Bermuda +1 (441) 278-5400 |
| (Address and telephone number of Registrant's principal executive offices) | (Address and telephone number of Registrant's principal executive offices) |
| Fairfax (US) Inc. 401 East Corporate Drive, Suite 200 Lewisville, TX 75057 U.S.A. (972) 318-6100 |
|
| (Name, Address (Including Zip Code) and Telephone Number (Including Area Code) of Agent for Service in the United States) | |
Copies to:
| Derek Bulas Vice President, Chief Legal Officer and Corporate Secretary Fairfax Financial Holdings Limited Suite 800, 95 Wellington St. W. Toronto, Ontario M5J 2N7 (416) 367-4941 |
Mile T. Kurta, Esq. Christopher R. Bornhorst, Esq. Torys LLP 1114 Avenue of the Americas, 23rd Floor New York, New York 10036 (212) 880-6000 |
David Chaikof Robbie Leibel Torys LLP 79 Wellington St. W. Suite 3000 Toronto, Ontario M5K 1N2 (416) 865-0040 |
Approximate date of commencement of proposed sale of the securities to the public: as soon as practicable after this registration statement becomes effective.
If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) 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 this Form is a post-effective amendment filed pursuant to Rule 462(d) 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 applicable, place an X in the box to designate the appropriate rule provision relied upon in conducting this transaction:
Exchange Act Rule 13e-4(i) (Cross-Border Issuer Tender Offer) ¨
Exchange Act Rule 14d-1(d) (Cross-Border Third-Party Tender Offer) ¨
Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933.
| Emerging growth company ¨ |
If an emerging growth company that prepares its financial statements in accordance with U.S. GAAP, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards† provided pursuant to Section 7(a)(2)(B) of the Securities Act. ☐
| † | The term "new or revised financial accounting standard" refers to any update issued by the Financial Accounting Standards Board to its Accounting Standards Codification after April 5, 2012. |
The registrants hereby amend this registration statement on such date or dates as may be necessary to delay its effective date until the registrants 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, or until this registration statement shall become effective on such date as the Securities and Exchange Commission, acting pursuant to said Section 8(a), may determine.
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.
PRELIMINARY PROSPECTUS - SUBJECT TO COMPLETION - DATED MARCH 14, 2025
Fairfax Financial Holdings Limited
Allied World Assurance Company Holdings, Ltd
Offer to Exchange
$600,000,000 aggregate principal amount of 6.100% Senior Notes due 2055
for
$600,000,000 aggregate principal amount of 6.100% Senior Notes due 2055
that have been registered under the
Securities Act of 1933, as amended (the "Securities Act")
The Exchange Offer will expire at 5:00 p.m.,
New York City time, on , 2025, unless extended.
Fairfax Financial Holdings Limited ("Fairfax" or the "Company") and the Company's subsidiary, Allied World Assurance Company Holdings, Ltd ("Allied World"), as co-obligors of the 6.100% Senior Notes due 2055 (the "Notes"), hereby offer, upon the terms and subject to the conditions set forth in this prospectus and the accompanying letter of transmittal, to exchange up to $600,000,000 aggregate principal amount of the outstanding Notes (the "Initial Notes") that are validly tendered and not validly withdrawn for an equal principal amount of new Notes (the "Exchange Notes") that will be registered under the Securities Act pursuant to this prospectus. This offer is referred to as the "Exchange Offer".
The terms of the Exchange Notes will be identical to the terms of the Initial Notes, except that, unlike the Initial Notes, the Exchange Notes will be freely tradable in the United States by persons not affiliated with us, will not bear legends restricting their transfer and will not contain the registration rights provisions of the Initial Notes. The payment obligations of each of Fairfax and Allied World in respect of the Notes are full and unconditional.
The Exchange Offer will expire at 5:00 p.m., New York City time, on , 2025, unless we extend the Exchange Offer, in which case, the Exchange Offer will expire at 5:00 p.m., New York City time, on the date to which the Exchange Offer is extended (the "Expiration Date").
We will not receive any cash proceeds from the issuance of the Exchange Notes in the Exchange Offer.
No public market currently exists for the Initial Notes. We do not intend to list the Exchange Notes on any securities exchange and, therefore, no active public market is anticipated.
Before participating in the Exchange Offer, please carefully read this prospectus, including the section entitled "Risk Factors" commencing on page 10.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE U.S. SECURITIES AND EXCHANGE COMMISSION (THE "SEC") OR ANY CANADIAN SECURITIES REGULATORY AUTHORITY, NOR HAS THE SEC PASSED UPON THE ACCURACY OR ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENCE.
The date of this prospectus is , 2025
TABLE OF CONTENTS
Unless the context otherwise requires, the term "Fairfax" or the "Company" refers to Fairfax Financial Holdings Limited and its subsidiaries; the term "Allied World" refers to Allied World Assurance Company Holdings, Ltd, our majority-owned Bermuda-based holding company that, through its subsidiaries, provides global property, casualty and specialty insurance and reinsurance; the term "Brit" refers to our wholly-owned specialty insurance and reinsurance company operating in the Lloyd's market, Brit Group Holdings Limited and its subsidiaries; the term "Bryte" refers to our wholly-owned South African property and casualty insurance business, Bryte Insurance Company Ltd.; the term "Colonnade" refers to our wholly-owned Luxembourg-based insurance company, Colonnade Insurance S.A.; the term "Crum & Forster" refers to our wholly-owned U.S. property and casualty insurance business, Crum & Forster Holdings Corp. and its subsidiaries; the term "Fairfax Asia" refers to our property and casualty insurance and reinsurance business conducted through our subsidiaries in Hong Kong, Sri Lanka, Indonesia, Malaysia, Singapore and Thailand; the term "Fairfax Brasil" refers to our wholly-owned Brazilian property and casualty insurance company, Fairfax Brasil Seguros Corporativos S.A.; the term "Fairfax Latam" refers to our property and casualty insurance business conducted in Argentina, Chile, Colombia and Uruguay; the term "Fairfax Ukraine" refers to our wholly-owned property and casualty insurance business conducted through our subsidiaries in Ukraine; the term "GIG" refers to our majority-owned Kuwait company with property and casualty insurance operations in the Middle East and North Africa ("MENA") region, Gulf Insurance Group K.S.C.P.; the term "Group Re" refers to our wholly-owned reinsurance business, conducted through certain other subsidiaries; the term "Hamblin Watsa" refers to our wholly-owned investment management subsidiary, Hamblin Watsa Investment Counsel Ltd.; the term "Ki Insurance" refers to our majority-controlled fully digital and algorithmically driven Lloyd's of London syndicate, Ki Financial Limited; the term "Northbridge" refers to our wholly-owned Canadian property and casualty insurance business, Northbridge Financial Corporation and its subsidiaries; the term "Odyssey Group" refers to our majority-owned U.S. reinsurance and insurance business, Odyssey Group Holdings Inc. and its subsidiaries; the term "Polish Re" refers to our wholly-owned Polish reinsurance company, Polskie Towarzystwo Reasekuracji Spólka Akcyjna; the term "Zenith National" refers to our wholly-owned U.S. workers' compensation insurance business, Zenith National Insurance Corp. and its subsidiaries; and the term "Eurolife" refers to our majority-owned Greek life and non-life insurer, Eurolife FFH Insurance Group Holdings S.A.
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ABOUT THIS PROSPECTUS
You should rely only on the information contained in or incorporated by reference in this prospectus. We have not authorized any other person to provide you with different information. If anyone provides you with different or inconsistent information, you should not rely on it. You should not assume that the information provided by this prospectus is accurate as of any date other than the date on the front of this prospectus. Our business, financial condition, results of operations and prospects may have changed since then. The Exchange Notes are being offered only in jurisdictions in which offers and sales are permitted. When the term "Notes" is used in this prospectus, the term includes the Initial Notes and the Exchange Notes unless otherwise indicated or the context otherwise requires. The terms of the Exchange Offer and Exchange Notes are summarized below and are more fully described in this prospectus.
You should read this prospectus carefully before you invest. This prospectus contains important information you should consider when making your investment decision and incorporates by reference business and financial information about us that is not included in or delivered with this prospectus. Copies of the documents incorporated by reference herein and the Indenture (as defined below) may be obtained without charge by writing to us at 95 Wellington Street West, Suite 800, Toronto, Ontario, M5J 2N7. Attention: Corporate Secretary. Our telephone number at that address is (416) 367-4941. To ensure timely delivery of requested information, you must make your request to us no later than five business days prior to the Expiration Date of the Exchange Offer.
We are making the Exchange Offer as a foreign issuer in the United States. Prospective investors should be aware that such requirements are different from those in the United States. The financial statements incorporated herein by reference have been prepared in accordance with International Financial Reporting Standards as issued by the International Accounting Standards Board ("IFRS Accounting Standards"). Thus, such financial statements may not be comparable to financial statements of U.S. companies.
Each broker-dealer that receives Exchange Notes for its own account pursuant to the Exchange Offer must acknowledge that it will deliver a prospectus meeting the requirements of the Securities Act in connection with any resale or transfer of such Exchange Notes in the United States. The letter of transmittal states that by so acknowledging and by delivering a prospectus, a broker-dealer will not be deemed to admit that it is an "underwriter" within the meaning of the Securities Act. This prospectus, as it may be amended or supplemented from time to time, may be used by a broker-dealer in connection with resales or transfers of Exchange Notes in the United States received in exchange for Initial Notes where Initial Notes were acquired by such broker-dealer as a result of market-making or other trading activities. The Company has agreed that it will make this prospectus available to any broker-dealer for use in connection with any such resale or transfer for a period that ends the earlier of (i) 180 days after the date on which the Registration Statement (as defined herein) that includes this prospectus is declared effective by the SEC, and (ii) the date on which participating broker-dealers are no longer required to deliver a prospectus in connection with market-making or other trading activities. See "Plan of Distribution".
Prospective investors should be aware that owning the Exchange Notes may subject you to tax consequences in each of the United States, Canada and Bermuda. This prospectus may not describe these tax consequences fully and such consequences for investors who are resident in, or citizens of, the United States may not be described fully herein. You should read the tax discussion in this prospectus. You should consult your own counsel, accountant or other advisors for legal, tax, business, financial and related advice regarding the Exchange Offer.
The enforcement by investors of civil liabilities under U.S. federal or state securities laws or other laws of the United States may be affected adversely by the fact that the Company and Allied World are each formed outside the United States, that most of our directors and officers, as well as certain of the experts named in this prospectus, reside outside of the United States, and that many of our assets and the assets of such persons are located outside the United States.
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PRESENTATION OF FINANCIAL INFORMATION
As the majority of our operations are in the United States or conducted in U.S. dollars, we report our consolidated financial statements in U.S. dollars in order to provide more meaningful information to users of our financial statements. Except where otherwise indicated, all dollar amounts in this prospectus are expressed in U.S. dollars, references to "$", "US$" and "dollars" are to U.S. dollars and references to "Cdn$" are to Canadian dollars.
We have prepared our audited consolidated financial statements in accordance with IFRS Accounting Standards.
DOCUMENTS INCORPORATED BY REFERENCE
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. We incorporate by reference the following documents we have filed with the SEC:
| (a) | our Annual Report on Form 40-F for the year ended December 31, 2024, filed with the SEC on March 7, 2025 (the "Annual Report"); and |
In addition, we incorporate by reference the future filings we make with the SEC under Section 13(a), 13(c), or 15(d) of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), after (i) the initial filing date of the registration statement and prior to effectiveness of the registration statement and (ii) the date of this prospectus until the date we consummate the Exchange Offer. Any Form 6-K that we file or furnish that is identified in such form as being incorporated by reference into the registration statement of which this prospectus forms a part, in each case, subsequent to the date of this prospectus, are incorporated by reference into this prospectus as of the date of the filing of such documents.
Any statement contained in a document incorporated or deemed to be incorporated by reference in this prospectus shall be deemed to be modified or superseded for the purposes of this prospectus to the extent that a statement contained in this prospectus, or in any other subsequently filed document which also is or is deemed to be incorporated by reference herein, modifies or supersedes that statement. The modifying or superseding statement need not state that it has modified or superseded a prior statement or include any other information set forth in the document that it modifies or supersedes.
WHERE YOU CAN FIND MORE INFORMATION
We have filed a registration statement on Form F-4 (the "Registration Statement") with the SEC regarding the Exchange Offer, which includes this prospectus as part of such Registration Statement. For further information about us and the Exchange Offer, you should refer to the Registration Statement and its exhibits. This prospectus summarizes material provisions of agreements and other documents to which we refer you. Copies of these agreements and documents have been included as exhibits to the Registration Statement and you are encouraged to read these in their entirety.
The SEC maintains an Internet website that contains reports and other information about issuers who file reports with the SEC. The address of that website is www.sec.gov. The Company also files information, such as periodic reports and financial information, with the Canadian Securities Administrators, which may be accessed at www.sedarplus.ca. These filings can also be found on the Company's website, which may be accessed at www.fairfax.ca. The information on our website is not incorporated by reference into this prospectus and should not be considered a part of this prospectus, and the reference to our website in this prospectus is an inactive textual reference only.
The Company is currently subject to the periodic reporting and other informational requirements of the Exchange Act and in accordance therewith files reports and other information with the SEC. However, the Company is a "foreign private issuer" as defined in Rule 405 of the Securities Act and therefore is not required to comply with Exchange Act provisions regarding the furnishing and content of proxy statements, and its officers and directors are exempt from the reporting and short swing profit recovery provisions contained in Section 16 of the Exchange Act. Additionally, under a multijurisdictional disclosure system adopted by the United States and Canada, public reporting documents and other information (including financial information) have been prepared in accordance with the disclosure requirements of the provincial and territorial securities regulatory authorities of Canada, which differ from those in the United States.
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As described in "Description of the Notes" in this prospectus, on July 19, 2024, Allied World became a co-obligor of the Notes that are the subject of this Exchange Offer, and the Company remains a full and unconditional obligor in respect of the Notes for all purposes under the Indenture. Accordingly, Allied World is exempt from the reporting requirements of the Exchange Act in reliance on Rule 12h-5 thereunder. Disclosures required by Rules 3-10 and 13-01 of Regulation S-X have been included in Management's Discussion and Analysis included in the Annual Report, which is incorporated by reference herein.
ENFORCEABILITY OF CIVIL LIABILITIES AGAINST FOREIGN PERSONS
The Company is a corporation organized under the laws of Canada and some of its assets are located in, and most of its directors and officers are residents of, Canada. Further, Allied World is incorporated under the laws of Bermuda, and most of its directors and officers, and its assets, are located outside of the United States. As a result, it may be difficult for U.S. investors to effect service of process in the United States upon the Company's or Allied World's directors or officers, or to realize upon judgments of U.S. courts predicated upon civil liability of such directors or officers under U.S. securities laws.
We have been advised by our counsel that a monetary judgment of a U.S. court predicated solely upon civil liability provisions of U.S. federal securities laws would likely be enforceable in Canada if the U.S. court in which judgment was obtained had a basis for jurisdiction that was recognized by a Canadian court for such purposes. We have also been advised by our counsel that it is less certain that an original action could be commenced in Canada on the basis of liability predicated solely upon such laws.
Each of the Company and Allied World has irrevocably appointed CT Corporation System, 28 Liberty Street, New York, New York 10005, as its U.S. agent for service of process in any legal action or proceeding arising out of or relating to the Indenture and the Exchange Notes for actions brought under U.S. federal or state securities laws or for actions brought by either trustee or for any actions arising out of or related to the Indenture or the Exchange Notes in any New York court, and has irrevocably submitted to the jurisdiction of the New York courts for such purposes.
In addition, each of the Company and Allied World has appointed Fairfax (US) Inc., 401 East Corporate Drive, Suite 200 Lewisville, Texas 75057, as our U.S. agent for service of process in connection with the Registration Statement.
FORWARD-LOOKING INFORMATION
This prospectus contains "forward-looking statements" and "forward-looking information" (collectively, "forward-looking information") within the meaning of applicable securities laws. Any statements made by us or on our behalf may include forward-looking information that reflect our current views with respect to future events and financial performance. The words "believe," "anticipate," "project," "expect," "plan," "intend," "predict," "estimate," "will likely result," "will seek to" or "will continue" and similar expressions identify forward-looking information. This forward-looking information relates to, among other things, our plans and objectives for future operations and underwriting profits. We caution readers not to place undue reliance on this forward-looking information, which speak only as of their dates. We are under no obligation to update or alter such forward-looking information as a result of new information, future events or otherwise, except as may be required by applicable securities laws. This forward-looking information is subject to known and unknown risks, uncertainties and other factors that could cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking information. These uncertainties and other factors, which we describe in more detail elsewhere in this prospectus, or in documents incorporated by reference herein, include, but are not limited to:
| · | our ability to complete acquisitions and other strategic transactions on the terms and timeframes contemplated, and to achieve the anticipated benefits therefrom; |
| · | a reduction in net earnings if our loss reserves are insufficient; |
| · | underwriting losses on the risks we insure that are higher than expected; |
| · | the occurrence of catastrophic events with a frequency or severity exceeding our estimates; |
| · | changes in market variables, including unfavorable changes in interest rates, foreign exchange rates, equity prices and credit spreads, which could negatively affect our operating results and investment portfolio; |
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| · | the cycles of the insurance market and general economic conditions, which can substantially influence our and our competitors' premium rates and capacity to write new business; |
| · | insufficient reserves for asbestos, environmental and other latent claims; |
| · | exposure to credit risk in the event our reinsurers fail to make payments to us under our reinsurance arrangements; |
| · | exposure to credit risk in the event our insureds, insurance producers or reinsurance intermediaries fail to remit premiums that are owed to us or failure by our insureds to reimburse us for deductibles that are paid by us on their behalf; |
| · | our inability to maintain our long-term debt ratings, the inability of our subsidiaries to maintain financial or claims paying ability ratings and the impact of a downgrade of such ratings on derivative transactions that we or our subsidiaries have entered into; |
| · | risks associated with implementing our business strategies; |
| · | the timing of claims payments being sooner or the receipt of reinsurance recoverables being later than anticipated by us; |
| · | risks associated with any use we may make of derivative instruments; |
| · | the failure of any hedging methods we may employ to achieve their desired risk management objective; |
| · | a decrease in the level of demand for insurance or reinsurance products, or increased competition in the insurance industry; |
| · | the impact of emerging claim and coverage issues or the failure of any of the loss limitation methods we employ; |
| · | our inability to access cash of our subsidiaries; |
| · | an increase in the amount of capital that we and our subsidiaries are required to maintain and our inability to obtain required levels of capital on favorable terms, if at all; |
| · | the loss of key employees; |
| · | our inability to obtain reinsurance coverage in sufficient amounts, at reasonable prices or on terms that adequately protect us; |
| · | the passage of legislation subjecting our businesses to additional adverse requirements, supervision or regulation, including additional tax regulation, in the United States, Bermuda, Canada or other jurisdictions in which we operate; |
| · | risks associated with applicable laws and regulations relating to sanctions and corrupt practices in foreign jurisdictions in which we operate; |
| · | risks associated with government investigations of, and litigation and negative publicity related to, insurance industry practice or any other conduct; |
| · | risks associated with political and other developments in foreign jurisdictions in which we operate; |
| · | risks associated with legal or regulatory proceedings or significant litigation; |
| · | failures or security breaches of our computer and data processing systems; |
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| · | the influence exercisable by our significant shareholder; |
| · | adverse fluctuations in foreign currency exchange rates; |
| · | our dependence on independent brokers over whom we exercise little control; |
| · | financial reporting risks associated with IFRS 17 (as defined below); |
| · | financial reporting risks relating to deferred taxes associated with amendments to IAS 12 (as defined below); |
| · | impairment of the carrying value of our goodwill, indefinite-lived intangible assets or investments in associates; |
| · | our failure to realize deferred income tax assets; |
| · | technological or other change that adversely impacts demand, or the premiums payable, for the insurance coverages we offer; |
| · | disruptions of our information technology systems; |
| · | assessments and shared market mechanisms that may adversely affect our insurance subsidiaries; |
| · | risks associated with the conflicts in Ukraine and Israel and the development of other geopolitical events and economic disruptions worldwide; and |
| · | risks associated with tariffs, trade restrictions, or other regulatory measures imposed by domestic or foreign governments that may, directly or indirectly, affect our business. |
See the "Risk Factors" section of this prospectus and the documents incorporated by reference into this prospectus for a further discussion of these risks and uncertainties.
Should one or more risk, uncertainty, contingency or other factor materialize or should any factor or assumption prove incorrect, actual results could vary materially from those expressed or implied in the forward-looking information. Accordingly, you should not place undue reliance on forward-looking information. We do not assume any obligation to update or revise any forward-looking information after the date of this prospectus or to explain any material difference between subsequent actual events and any forward-looking information, except as required by applicable law.
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SUMMARY
This summary should be read in conjunction with the detailed information and financial statements incorporated by reference into this prospectus. This summary highlights selected information contained elsewhere in, or incorporated by reference into, this prospectus. You should read the entire prospectus and the information incorporated herein closely.
Description of the Businesses
Fairfax is a holding company incorporated under the Canada Business Corporations Act which, through its subsidiaries, is primarily engaged in property and casualty insurance and reinsurance and the associated investment management. Fairfax operates through a decentralized operating structure, with autonomous management teams applying a focused underwriting strategy to our markets. We seek to differentiate ourselves by combining disciplined underwriting with the investment of our assets on a total retubasis, which we believe provides above-average returns over the long-term. We provide a full range of property and casualty products, maintaining a diversified portfolio of risks across classes of business, geographic regions, and types of insureds. We have been under present management since September 1985. Our principal executive offices are located at Suite 800, 95 Wellington Street West, Toronto, Ontario, Canada M5J 2N7. Our telephone number is (416) 367-4941.
Allied World, the Co-Obligor of the Notes, is the Company's 83.4%-owned Bermuda-based holding company subsidiary that, through its subsidiaries, provides global property, casualty and specialty insurance and reinsurance. See "-Property and Casualty Insurance and Reinsurance" below.
We conduct our business through the following segments, with each of our continuing operations maintaining a strong position in its respective markets.
Property and Casualty Insurance and Reinsurance
Our reinsurance business is conducted through Odyssey Group, Group Re, Brit, Ki Insurance, Allied World, Polish Re and Singapore Reinsurance Corporation Limited ("Singapore Re"). Odyssey Group, our 90.0%-owned subsidiary, is a U.S. based underwriter of a full range of property and casualty reinsurance on a global basis. Group Re primarily constitutes the participation by our wholly-owned subsidiaries CRC Reinsurance Limited, Wentworth Insurance Company Ltd. and Connemara Reinsurance Company Ltd. (all based in Barbados) in the reinsurance of Fairfax's subsidiaries by quota share or through participation in those subsidiaries' third-party reinsurance programs on the same terms and pricing as the third-party reinsurers. Group Re also writes third-party business. Brit, our wholly-owned subsidiary based in England and Wales, is a market-leading global Lloyd's of London specialty insurer and reinsurer. Ki Insurance, our 20.0%-owned subsidiary based in England and Wales, is a fully digital Lloyd's of London syndicate that algorithmically underwrites property, casualty and specialty reinsurance. Allied World, our 83.4%-owned subsidiary based in Bermuda, is a global property, casualty and specialty reinsurer. Polish Re, based in Warsaw, Poland, writes reinsurance business in the Central and EasteEuropean regions. Singapore Re, based in Singapore, is a general reinsurance company providing reinsurance coverage in the Asia region. We also hold a 47.7% interest in Thai Reinsurance Public Company Limited (a provider of reinsurance and insurance services based in Bangkok, Thailand).
Our insurance business is conducted through Northbridge (Canadian insurance), Crum & Forster (U.S. property and casualty insurance), Zenith National (U.S. workers' compensation insurance), Odyssey Group, Brit, Ki Insurance and Allied World (global insurance), Fairfax Asia (Asian insurance), Fairfax Latam (South American insurance), Bryte (South African insurance), Fairfax Brasil (Brazilian insurance), Colonnade (Central and EasteEuropean insurance), and Fairfax Ukraine (Ukrainian property and casualty insurance). We also hold a 97.1% interest in GIG (a Kuwait company with property and casualty insurance operations in the MENA region). Northbridge provides commercial and personal lines property and casualty insurance primarily in Canada through a wide range of distribution channels. Crum & Forster provides a full range of commercial property and casualty insurance, which targets specialty classes of business that emphasize strong technical underwriting expertise. Zenith National is primarily engaged in the workers' compensation insurance business in the United States. Odyssey Group provides a range of professional and specialty liability insurance in the United States and globally through its U.S. Insurance and London Market divisions. Brit is a market-leading global Lloyd's of London specialty insurer. Ki Insurance is a fully digital Lloyd's of London syndicate that provides algorithmically driven property, casualty and specialty insurance. Allied World is a market-leading global property, casualty and specialty insurer. Fairfax Asia is comprised of Singapore Re, as described above, as well as:
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| · | our wholly-owned Hong Kong-based subsidiary, Falcon Insurance Company (Hong Kong) Limited, which writes property and casualty insurance in niche markets in Hong Kong; |
| · | our 85.0%-owned, Malaysia-based subsidiary, The Pacific Insurance Berhad, which writes all classes of general insurance and medical insurance in Malaysia; |
| · | our 80.8%-owned, Jakarta-based subsidiary, PT Asuransi Multi Artha Guna Tbk, an Indonesian general insurance company; |
| · | our 78.0%-owned, Sri Lanka-based subsidiary, Fairfirst Insurance Limited, a Sri Lankan general insurance company; |
| · | our 96.7%-owned, Thailand-based subsidiary, The Falcon Insurance Public Company Limited, a Thai property and casualty insurance company; |
| · | our 35.0% interest in Bank for Investment and Development of Vietnam Insurance Joint Stock Corporation, a Vietnamese property and casualty insurance company; and |
| · | our 49.0% interest in Go Digit Infoworks Services Private Limited, whose subsidiary, Go Digit General Insurance Limited, is an Indian general insurance company. |
Fairfax Latam, based in Miami, Florida, consists of insurance operations in Argentina, Chile, Colombia and Uruguay. Bryte, based in South Africa, writes property and casualty insurance in South Africa and Botswana. Fairfax Brasil, based in Brazil, writes commercial property and casualty business, with a primary focus on markets in Brazil. Colonnade, based in Luxembourg, writes business in the Central and Easteregions of Europe. Fairfax Ukraine, our wholly-owned subsidiary based in Ukraine, writes property and casualty insurance in Ukraine.
Life Insurance and Run-off
Eurolife, our 80.0%-owned subsidiary based in Greece, writes life and non-life insurance primarily in Greece.
Our run-off business, comprised of the U.S. run-off group, which consists primarily of TIG Insurance Company and Riverstone Group Holding Company, and its subsidiaries, includes our discontinued business that did not meet our underwriting criteria or strategic objectives, selected business previously written by our other subsidiaries that was put under dedicated run-off management and third-party run-off operations that we have acquired, which we believe will provide us with the opportunity to eaattractive returns on our invested capital. In addition, the U.S. run-off group manages third-party claims administration.
Non-insurance Companies
Our non-insurance companies reporting segment comprises Recipe Unlimited Corporation ("Recipe"), Sporting Life Group Limited ("Sporting Life Group"), Sleep Country Canada Holdings Inc. ("Sleep Country", which was acquired on October 1, 2024), Meadow Foods Limited ("Meadow Foods", which was consolidated on November 29, 2024), Peak Achievement Athletics Inc. ("Peak Achievement", which was consolidated on December 20, 2024), Boat Rocker Media Inc. ("Boat Rocker"), Dexterra Group Inc. ("Dexterra Group"), AGT Food and Ingredients Inc. ("AGT"), Farmers Edge Inc. ("Farmers Edge"), Grivalia Hospitality S.A. ("Grivalia Hospitality"), Thomas Cook (India) Limited ("Thomas Cook India") and its wholly-owned subsidiary, Sterling Holiday Resorts Limited ("Sterling Resorts"), and Fairfax India Holdings Corporation ("Fairfax India") and its subsidiaries. Recipe franchises and/or operates restaurant brands across Canada and in select locations in the United States. Sporting Life Group is a leading Canadian sports lifestyle retail organization. Sleep Country is Canada's leading specialty sleep retailer with a national retail store network and multiple eCommerce platforms. Meadow Foods is a value-added milk, fats, fresh confectionery and plant-based bulk ingredients business. Peak Achievement is engaged in the design, manufacture and distribution of performance sports equipment and related apparel and accessories for ice hockey, roller hockey and lacrosse, under brands such as Bauer Hockey, Cascade Lacrosse and Maverik Lacrosse. Boat Rocker is a global content creator producing and distributing high quality and award-winning entertainment for television, film, and digital. Dexterra Group is a diversified support services organization delivering quality solutions for the creation, management and operation of infrastructure across Canada. AGT is a supplier of pulses, staple foods and food ingredients. Farmers Edge provides advanced digital tools to growers and other key participants in the agricultural value chain. Grivalia Hospitality acquires, develops and manages hospitality real estate in Greece, Cyprus and Panama. Thomas Cook India is an integrated travel and travel-related financial services company in India, offering a broad range of services that include foreign exchange, corporate and leisure travel and insurance. Sterling Resorts is engaged in vacation ownership and leisure hospitality and operates a network of resorts in India. Fairfax India invests in public and private equity and debt instruments in India and Indian businesses or other businesses primarily conducted in or dependent on India.
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Our invested assets are managed by our wholly-owned investment management subsidiary, Hamblin Watsa. Hamblin Watsa has managed our invested assets since September 1985 and emphasizes a conservative investment philosophy, seeking to invest our assets on a total retubasis, which includes realized and unrealized gains over the long-term, using a value-oriented approach.
Our insurance operations primarily use brokers to distribute their business and, in some instances, will distribute through agents or directly to the customer. They may also conduct business through third parties such as managing general agents where it is cost effective to do so and where we can control the underwriting process to ensure our risk management criteria are met. Our insurance operations have relationships with many different types of brokers including independent retail brokers, wholesale brokers and national brokers depending on the particular jurisdiction. Each of these channels has its own distinct distribution characteristics and customers. Our reinsurance operations are dependent primarily on a limited number of international reinsurance brokers.
Recent Developments
Executive Announcements
On March 7, 2025, we announced that, effective March 10, 2025, Amy Sherk has been appointed Chief Financial Officer of Fairfax and Jennifer Allen, who held this position since 2019 and has been with Fairfax for 19 years, will transition into the new role of Chief Business Officer of Fairfax.
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The Exchange Offer
The following is a brief summary of certain terms of the Exchange Offer. For a more complete description of the terms of the Exchange Offer, see "The Exchange Offer".
| Exchange Offer: | We will exchange your Initial Notes for an equal aggregate principal amount of Exchange Notes. |
| Resale of Exchange Notes: |
Based on an interpretation by the staff of the SEC set forth in no-action letters issued to third parties, you may offer the Exchange Notes for resale, resell and otherwise transfer them without compliance with the registration or prospectus delivery provisions of the Securities Act if: · you are acquiring the Exchange Notes in the ordinary course of your business; · you are not participating, do not intend to participate and have no arrangement or understanding with any person to participate, in the distribution of the Exchange Notes issued to you; and · you are not an affiliate (as defined in Rule 405 of the Securities Act), of the Company or Allied World. Each broker-dealer that receives Exchange Notes for its own account pursuant to the Exchange Offer must acknowledge that it will deliver a prospectus in connection with any resale of such Exchange Notes in the United States. The letter of transmittal states that by so acknowledging and by delivering a prospectus, a broker-dealer will not be deemed to admit that it is an "underwriter" within the meaning of the Securities Act. The letter of transmittal also includes an acknowledgment that each person participating in the Exchange Offer does not intend to engage in a distribution of the Exchange Notes. In addition, the letter of transmittal includes an acknowledgment for each person that is a broker-dealer in connection with resales of Exchange Notes received in exchange for Initial Notes where such Initial Notes were acquired by such broker-dealer as a result of market-making activities or other trading activities that such broker-dealer will satisfy any prospectus delivery requirements in connection with any resale of Exchange Notes received pursuant to the Exchange Offer. This prospectus, as it may be amended or supplemented from time to time, may be used by such broker-dealers for such prospectus delivery requirements. We have agreed that, for a period of 180 days after the Expiration Date, we will make this prospectus available to any broker-dealer for use in connection with any such resale. See "Plan of Distribution". Any holder of Initial Notes who is our affiliate, does not acquire Exchange Notes in the ordinary course of its business, or tenders its Initial Notes in the Exchange Offer with the intention to participate, or for the purpose of participating, in a distribution of Exchange Notes, cannot rely on the position of the staff of the SEC enunciated in Morgan Stanley & Co. Incorporated (available June 5, 1991) and Exxon Capital Holdings Corporation (available May 13, 1988), as interpreted in Shearman & Sterling (available July 2, 1993), or similar no-action letters and, in the absence of an exemption therefrom, must comply with the registration and prospectus delivery requirements of the Securities Act in connection with any resale of the Exchange Notes in the United States. You should read the discussion under the heading "The Exchange Offer" for further information regarding the Exchange Offer and resale of the Exchange Notes. |
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| Registration Rights Agreement: | We have undertaken this Exchange Offer pursuant to the terms of a registration rights agreement entered into with the initial purchasers of the Initial Notes on June 24, 2024 (the "Registration Rights Agreement"). See "The Exchange Offer". |
| Consequences of Failure to Exchange Initial Notes: |
You will continue to hold the Initial Notes that remain subject to their existing transfer restrictions if: · you do not tender your Initial Notes; or · you tender your Initial Notes and they are not accepted for exchange. We will have no obligation to register resales of the Initial Notes after we consummate the Exchange Offer. See "The Exchange Offer - Terms of the Exchange Offer - Consequences of Failure to Exchange" and "The Exchange Offer - Terms of the Exchange Offer - Acceptance of Initial Notes for Exchange; Delivery of Exchange Notes". |
| Expiration Date: | The Expiration Date for the Exchange Offer is 5:00 p.m., New York City time, on , 2025, unless we extend, in which case "Expiration Date" means 5:00 p.m., New York City time, on the date to which the Exchange Offer is extended. |
| Conditions to the Exchange Offer: | The Exchange Offer is subject to certain customary conditions, which we may waive with respect to the Exchange Offer. See "The Exchange Offer - Terms of the Exchange Offer - Conditions". |
| Procedures for Tendering Initial Notes: | If you wish to accept the Exchange Offer, you must submit the required documentation and effect a tender of Initial Notes pursuant to the procedures for book-entry transfer (or other applicable procedures), all in accordance with the instructions described in this prospectus and in the relevant letter of transmittal. See "The Exchange Offer - Terms of the Exchange Offer - Procedures for Tendering", "The Exchange Offer - Terms of the Exchange Offer - Book-Entry Transfer", "The Exchange Offer - Terms of the Exchange Offer - Exchanging Book-Entry Notes" and "The Exchange Offer - Terms of the Exchange Offer - Guaranteed Delivery Procedures". |
| Guaranteed Delivery Procedures: | If you wish to tender your Initial Notes, but cannot properly do so prior to the Expiration Date, you may tender your Initial Notes in accordance with the guaranteed delivery procedures described in "The Exchange Offer - Terms of the Exchange Offer - Guaranteed Delivery Procedures". |
| Withdrawal Rights: | Tenders of Initial Notes may be withdrawn at any time prior to the Expiration Date. To withdraw a tender of Initial Notes, you must deliver a notice of withdrawal in accordance with the procedures described in "The Exchange Offer - Terms of the Exchange Offer - Withdrawal of Tenders" prior to the Expiration Date. |
| Acceptance of Initial Notes and Delivery of Exchange Notes: | Subject to certain conditions, any and all Initial Notes that are validly tendered in the Exchange Offer prior to the Expiration Date will be accepted for exchange. The Exchange Notes issued pursuant to the Exchange Offer will be delivered promptly following the Expiration Date. See "The Exchange Offer - Terms of the Exchange Offer - Acceptance of Initial Notes for Exchange; Delivery of Exchange Notes". |
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| U.S. Federal Income Tax Considerations: | The exchange of Initial Notes for Exchange Notes pursuant to the Exchange Offer will not be treated as a taxable exchange or other taxable event for U.S. federal income tax purposes. See "Certain United States Federal Income Tax Considerations". |
|
Bermuda Tax Considerations: |
The Corporate Income Tax Act 2023 (the "CIT Act") does not impose any withholding tax, capital transfer tax, estate duty or inheritance and no such taxes are applicable in Bermuda in respect of the Initial Notes (or the Exchange Notes) held by non-residents of Bermuda. Holders who are ordinarily resident in Bermuda should consult their own tax advisors regarding possible Bermuda taxes with respect to the Exchange Offer. See "Certain Bermuda Considerations". |
| Canadian Federal Income Tax Considerations: | The exchange of the Initial Notes for the Exchange Notes pursuant to the Exchange Offer should not constitute a taxable transaction for Canadian federal income tax purposes. See "Certain Canadian Federal Income Tax Considerations". |
| Use of Proceeds: | Neither the Company nor Allied World will receive any proceeds from the issuance of the Exchange Notes. We are offering the Exchange Notes solely to satisfy our obligations under the Registration Rights Agreement. Initial Notes that are validly tendered (and not validly withdrawn) and exchanged will be retired and cancelled and cannot be reissued. See "Use of Proceeds". |
| Exchange Agent: | The Bank of New York Mellon is serving as the exchange agent in respect of the Exchange Offer. |
| Summary of Terms of the Exchange Notes: |
The terms of the Exchange Notes will be substantially identical to the terms of the Initial Notes (see "- the Exchange Notes" below) except that the Exchange Notes: · will have been issued in the Exchange Offer, which is being registered under the Securities Act, and therefore the Exchange Notes will not bear a legend containing restrictions on transfer; · will not entitle their holders to registration rights; · will not contain provisions relating to additional interest for any failure to comply with the Registration Rights Agreement; and · will bear a different CUSIP number from the Initial Notes. |
The Exchange Notes
The following is a brief summary of certain terms of the Exchange Notes. For a more complete description of the terms of the Exchange Notes, see "Description of the Notes".
| Issuer: | Fairfax Financial Holdings Limited |
| Co-Obligor: |
Allied World Assurance Company Holdings, Ltd Pursuant to the fourth supplemental indenture dated as of July 19, 2024 (the "Fourth Supplemental Indenture"), the Company added Allied World as a Co-Obligor of the Initial Notes in accordance with the terms of the Initial Notes, and, upon completion of the Exchange Offer, the Exchange Notes will also include Allied World as a Co-Obligor as of the issue date of the Exchange Notes. |
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| Exchange Notes Offered: | Up to $600,000,000 aggregate principal amount of 6.100% Senior Notes due March 15, 2055. |
| Initial Notes Issue Date: | June 24, 2024 |
| Maturity Date: | March 15, 2055 |
| Interest: | 6.100% per annum. Interest is payable in semi-annual installments in arrears on each September 15 and March 15. |
| Ranking: | The Exchange Notes will be our direct, unsecured obligations and will form a part of the series of the Initial Notes. The Exchange Notes will rank equally and ratably with all of our other unsecured and unsubordinated indebtedness from time to time outstanding. The Exchange Notes will be effectively subordinated to any of our secured indebtedness to the extent of the assets securing such indebtedness. The Exchange Notes would also be structurally subordinated to all obligations of our subsidiaries (other than Allied World). See "Risk Factors - Risk Factors Relating to the Exchange Notes". |
| Payment of Additional Amounts: | Any payments made by us with respect to the Exchange Notes will be made without withholding or deduction for Canadian or Bermuda taxes unless required by law. Subject to certain exclusions, if we are required by law to withhold or deduct for Canadian or Bermuda taxes with respect to a payment to the holders of the Notes, we will pay the additional amount necessary so that the net amount received by the holders of the Exchange Notes after the withholding or deduction is not less than the amount that they would have received in the absence of the withholding or deduction. See "Description of the Notes - Payment of Additional Amounts". |
| Optional Redemption: | Prior to September 15, 2054 (the "Par Call Date
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