Company: MHLA
Filing Date: 2025-03-26
Form Type: DEFM14A
Source: 0001104659-25-028254
Chunk: 71

Company: Maiden Holdings, Ltd.
Filing Date: 2025-03-26
Form: DEFM14A
Chunk 71
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 ratings would likely materially adversely affect the combined company’s business through the loss of certain existing and potential policyholders and the loss of relationships with clients that might move to other companies with higher ratings. If such fronting companies lose their “A-” rating, the combined company may need to secure a new fronting arrangement or risk losing the business of its capacity providers to higher rated issuing carriers.

The combined company derives a significant portion of its fee revenues from a limited number of general agents, the loss of which could result in its inability to continue to write a significant portion of the current business, additional expense and a material decrease in fee revenues.

A significant portion of the combined company’s total fees are derived from a limited number of general agents and the combined company is heavily reliant upon these general agents to generate revenues. The decision of any such general agent to seek to terminate its arrangements with the combined company or to otherwise decrease the volume of business the combined company writes through them, could result in additional expense and a material decrease in the amount of fee revenues the combined company is able to generate. In addition, if the combined company is unable to collect fees under these arrangements due to insolvency, dispute or other unwillingness or inability of any of its general agents to meet their obligations to the combined company, its business, financial condition, results of operations or prospects could be materially and adversely affected.

The combined company will depend on a limited number of capacity providers and general agents for a large portion of its gross written premium, and the loss of business provided by any one of them could materially adversely affect the combined company.

The combined company will offer fronting arrangements to both general agents and capacity providers. Capacity providers may be either independent or under common control with a particular general agent. An independent capacity provider may reinsure a single book or multiple books with various general agents. A single general agent may control a single book with one capacity provider or multiple books with various capacity providers.

Other insurance companies compete with the combined company for this business. These capacity providers and general agents may choose to enter into fronting arrangements with such competitors, and the general agents or capacity providers may terminate fronting arrangements with the combined company if they no longer need access to its fronting capacity. Relationships with clients, including general agents and capacity providers, are generally governed by agreements that may be terminated on relatively short notice.

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Given the combined company’s reliance on a small group of capacity providers and general agents, a significant decrease in business from