Document:

Exhibit
4.3

 

 

Registration Rights Agreement

 

Between

 

OneBeacon Insurance Group, Ltd.

 

And

 

White Mountains Insurance
Group, Ltd.

 

Dated as of
               ,
2006

 

 

 

TABLE OF CONTENTS

 

	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  
	
  Section 1.
  Definitions.

  	
   

  	
  1

  
	
  Section 2.
  Demand Registration.

  	
   

  	
  3

  
	
  Section 3.
  Piggyback Registration

  	
   

  	
  5

  
	
  Section 4.
  Expenses

  	
   

  	
  7

  
	
  Section 5.
  Preparation and Filing

  	
   

  	
  7

  
	
  Section 6.
  Indemnification.

  	
   

  	
  10

  
	
  Section 7.
  Underwriting Agreement

  	
   

  	
  12

  
	
  Section 8.
  Agreements of the Selling Holders.

  	
   

  	
  13

  
	
  Section 9.
  Exchange Act Compliance

  	
   

  	
  13

  
	
  Section 10. No
  Conflicting Registration Rights

  	
   

  	
  13

  
	
  Section 11.
  Transfer of Registration Rights

  	
   

  	
  13

  
	
  Section 12.
  Enforcement.

  	
   

  	
  13

  
	
  Section 13.
  Miscellaneous.

  	
   

  	
  14

  

 

i

 

This
REGISTRATION RIGHTS AGREEMENT (this “Agreement”), dated as of            , 2006, is entered into by and
between OneBeacon Insurance Group, Ltd., a Bermuda exempted limited liability
company (including its successors, the “Company”), and White Mountains
Insurance Group, Ltd., a Bermuda exempted limited liability company.

 

Pursuant to
the Company’s [Amended] Bye-Laws the share capital of the Company consists of Class A
Common Shares, par value $0.01 per share (“Class A Common Shares”) and Class B
Common Shares, par value $.01 per share (“Class B Common Shares” and,
together with the Class B Common Shares, the “Common Shares”).  Class B Common Shares may only be owned
by White Mountains and its affiliates, and any purported sale, transfer or
other disposition of Class B Common Shares to any other Person will result
in the automatic conversion of such transferred shares into the Company’s Class A
Common Shares;

 

The Company
has filed a Registration Statement (File No. 333-136287) with the
Securities and Exchange Commission on Form S-1 (the “IPO Registration
Statement”) in connection with the initial public offering (the “IPO”) of its Class A
Common Shares; and

 

The Company
has agreed to provide White Mountains with the registration rights specified in
this Agreement following the IPO with respect to any Common Shares held by
White Mountains or any other Holder, on the terms and subject to the conditions
set forth herein.

 

In
consideration of the mutual covenants and agreements hereinafter contained and
for other good and valuable consideration, the receipt and sufficiency of which
are hereby acknowledged, the parties hereto agree as follows:

 

Section 1.  Definitions.

 

As used in
this Agreement, the following terms shall have the following respective
meanings:

 

“Business
Day” or “business day” means any day other than (a) a Saturday
or Sunday or (b) a day on which banks are authorized or required to be
closed in New York, New York; provided, however, that any
determination of a Business Day relating to a securities exchange or other securities
market means a Business Day on which such exchange or market is open for
trading.

 

“Common Shares”
shall have the meaning assigned to it in the recitals.

 

“Company”
shall have the meaning assigned to it in the introductory paragraph.

 

“Exchange
Act” means the Securities Exchange Act of 1934, as amended.

 

 

“Holder”
means (i) White Mountains and (ii) any direct or indirect transferee
of White Mountains who shall become a party to this Agreement in accordance
with Section 11 and has agreed in writing to be bound by the terms of this
Agreement.

 

“IPO
Underwriting Agreement” means the underwriting agreement dated    , 2006 among Lehman Brothers Inc., the
Company and White Mountains Holdings Bermuda Ltd.

 

“Other
Shares” means at any time those Common Shares which do not constitute
Primary Shares or Registrable Shares.

 

“Person”
shall include all natural persons, corporations, business trusts, associations,
companies, partnerships, joint ventures and other entities and governments and
agencies and political subdivisions thereof.

 

“Primary
Shares” means at any time the authorized but unissued Common Shares.

 

“Registrable
Shares” means at any time, with respect to any Holder, the Common Shares
beneficially owned by such Holder.  As to
any particular Registrable Shares, such Registrable Shares shall cease to be
Registrable Shares when (a) a registration statement with respect to the
sale by a Holder of such securities shall have become effective under the
Securities Act and such securities shall have been disposed of in accordance
with such registration statement, (b) such securities shall have been
distributed to the public pursuant to Rule 144 (or any successor
provision) under the Securities Act, (c) such securities shall have been
otherwise transferred, new certificates for such securities not bearing a
legend restricting further transfer shall have been delivered by the Company
and subsequent disposition of such securities shall not require registration or
qualification of such securities under the Securities Act or any state
securities or “blue sky” law then in force, or (d) such securities shall
have ceased to be outstanding.

 

“SEC”
means the Securities and Exchange Commission.

 

“Securities
Act” or “Act” means the Securities Act of 1933.

 

“Selling
Holder” means any Holder that sells or proposes to sell Registrable Shares
pursuant to a registration statement hereunder.

 

“Selling
Holders’ Counsel” means counsel selected by the holders of a majority of
the Registrable Shares to be sold by Holders pursuant to a particular
registration statement.

 

“Subsidiary”
means any corporation, association or other business entity (a) at least
50% of the outstanding voting securities of which are at the time owned or
controlled directly or indirectly by the Company; or (b) with respect to
which the Company possesses, directly or indirectly, the power to direct or
cause the direction of the affairs or management of such Person.

 

2

 

“White
Mountains” means White Mountains Insurance Group, Ltd., a Bermuda exempted limited
liability company, all successors to White Mountains Insurance Group, Ltd. by
way of merger, consolidation, amalgamation or sale of all or substantially all
of its assets or any comparable transaction or series of related transactions
(including contractual arrangements) having the same effect, any individual,
corporation, partnership, joint venture, limited liability company, or other
entity owning more than fifty percent (50%) of the outstanding voting shares of
such successor, and all corporations, partnerships, joint ventures, limited
liability companies, trusts, associations and other entities in which White
Mountains Insurance Group, Ltd. owns (directly or indirectly) more than fifty
percent (50%) of the outstanding voting stock or shares, voting power,
partnership interests or similar ownership interests, but, unless expressly
stated otherwise, shall not include the Company and all corporations,
partnerships, joint ventures, limited liability companies, trusts, associations
and other entities in which the Company owns (directly or indirectly) more than
fifty percent (50%) of the outstanding voting stock or shares, voting power,
partnership interests or similar ownership interests.

 

Section 2.  Demand Registration.

 

2.1.  (a)  If the Company shall be requested in
writing (a “Demand Request”) by a Holder or Holders who beneficially own
in the aggregate at least 2,500,000 Registrable Shares (as appropriately
adjusted for any share split, combination, reorganization, recapitalization,
reclassification, share dividend, share distribution or similar event), to
effect a registration under the Securities Act of Registrable Shares in
accordance with this Section 2 (a “Demand Registration”), then the
Company shall promptly give written notice of such proposed registration to
each other Holder, if any, and shall offer to include (subject to the terms of
this Agreement) in such proposed registration any Registrable Shares requested
to be included in such proposed registration by such other Holders who respond
in writing to the Company’s notice within 10 days after delivery of such
notice (which response shall specify the number of Registrable Shares proposed
to be included in such registration).  Such
Demand Request shall specify the approximate number of Registrable Shares
requested to be registered and the intended method of distribution.  With respect to any Demand Registration, the
requesting Holders may request the Company to effect a registration of the Registrable
Shares under a registration statement pursuant to Rule 415 under the
Securities Act (or any successor rule) (a “Shelf Registration”).  Subject to Section 2.2, the Company
shall promptly use its best efforts to effect such registration on an
appropriate form (which shall be Form S-3, if at such time the Company is
eligible to use such Form) under the Securities Act of the Registrable Shares
which the Company has been so requested to register.

 

(b)  If
the Company shall be requested in writing (a “Takedown Request”) by a
Holder or Holders who beneficially own in the aggregate at least 2,500,000
Registrable Shares (as appropriately adjusted for any stock split, combination,
reorganization, recapitalization, reclassification, share dividend, share
distribution or similar event) to assist them in effecting an offering (a “Takedown
Offering”) pursuant to a shelf registration statement that has previously
been filed and declared effective pursuant to a Demand Registration, then the
Company shall promptly give written notice of such proposed Takedown Offering
to each other Holder that is eligible to sell Shares 

 

3

 

pursuant to such effective
Shelf Registration and shall offer to include, subject to the terms of this
Agreement, any Shares of such other Holder that are registered in such
effective Shelf Registration to the extent so requested by such other Holder in
writing within 3 Business Days after delivery of such notice (which request
shall specify the number of Shares proposed to be included by such Holders in
such Takedown Offering.  The Takedown
Request shall specify the number of Shares to be included in such Takedown
Offering and the intended method of distribution.  Subject to Section 2.2, the Company
shall promptly use its best efforts to cooperate with the Holders and any
managing underwriter(s) to effect such Takedown Offering

 

2.2.  (a) The Company shall not be obligated to
file:

 

(i)  a Demand Registration (A) within
60 days after the effective date of a previous Demand Registration, or (B) within
180 days (or, if determined to be necessary pursuant to the IPO
Underwriting Agreement within 214 days) after the effective date of the
IPO Registration Statement;

 

(ii)  a Demand Registration unless the
Demand Request is for a number of Registrable Shares with a market value that
is equal to at least $50 million as of the date of such Demand Request;
and

 

(iii)  more than three Demand
Registrations during any 12-month period thereafter;

 

(b)  The
Company shall not be obligated to file or cause to be declared effective any
registration statement, or assist the Holders in connection with any Takedown Offering
pursuant to a Shelf Registration that has been previously filed and declared
effective pursuant to a Demand Registration, during any period in which (i) any
other registration statement (other than on Form S-4 or Form S-8
promulgated under the Securities Act or any successor forms thereto) (A) pursuant
to which Primary Shares are to be sold has been filed within the prior
90 days and not withdrawn or (B) which has been declared effective and
pursuant to which Primary Shares were sold within the prior 90 days, or (ii) the
Company has determined in good faith that the disclosure requirements of a
registration statement (including in connection with a proposed Takedown
Offering) would require the disclosure of material non-public information that
the Company has a bona fide business purpose for preserving as confidential,
such filing to be delayed until the date that is 90 days after the receipt of such
Demand Request; provided, that the Company may only so delay the filing
or effectiveness of a registration statement, or the assistance with respect to
a Takedown Offering, pursuant to this Section 2.1(b)(ii) on one
occasion during any twelve month period; and

 

(c)  With
respect to a Demand Registration, the Company may include in such registration
any Primary Shares or Other Shares; provided, however, that if a
managing underwriter in respect of any proposed underwritten offering to be
made pursuant to such Demand Registration (including any Takedown Offering) advises
the Company in writing that the inclusion of all Registrable Shares, Primary
Shares and Other Shares proposed to be included in such proposed underwritten
offering would 

 

4

 

adversely affect the successful
marketing (including pricing) of all such securities, then the number of
Registrable Shares, Primary Shares and Other Shares proposed to be included in
such proposed underwritten offering shall be included in the following order:

 

(i)  First, the Registrable Shares held
by all Selling Holders, pro rata based upon the number of Registrable Shares
owned by each such Selling Holder at the time of such registration;

 

(ii)  Second, the Primary Shares; and

 

(iii)  Third, the Other Shares.

 

2.3.  The Holder or Holders submitting a Demand
Request or Takedown Request may specify in such Demand Request or Takedown
Request that such registration (or that any Takedown Offering) cover an
underwritten offering.  Upon such
election, such Holder shall select one or more nationally recognized investment
banks to act as the managing underwriters and shall select any additional
investment banks to be used in connection with such offering, provided
that such selection shall be subject to the consent of the Company, which
consent shall not be unreasonably withheld or delayed.  The Company shall, together with Selling
Holders, enter into a customary underwriting agreement with such underwriters.

 

2.4.  A Demand Registration may be rescinded by
written notice to the Company by the Selling Holders holding a majority of the
Registrable Shares to be included in such registration under the following
circumstances:

 

(i)  If such Demand Registration is
rescinded prior to the date of the initial filing of the related registration
statement, such rescinded Demand Registration shall not count as a Demand Registration
initiated pursuant to this Section 2 for purposes of Section 2.2(a);
and

 

(ii)  If such Demand Registration is
rescinded after the date of the initial filing of the related registration
statement but prior to its effective date, such rescinded Demand Registration
shall not count as a registration statement initiated pursuant to this Section 2
for purposes of Section 2.1(a) if the Selling Holders (x) have
reimbursed the Company for all out-of-pocket expenses incurred by the Company
in connection with such rescinded Demand Registration or (y) (1) reasonably
believed that the registration statement contained an untrue statement of
material fact or omitted to state a material fact required to be stated therein
or necessary to make the statements made therein not misleading, (2) notified
the Company of such fact and requested that the Company correct such alleged
misstatement or omission and (3) the Company has refused to correct such
alleged misstatement or omission.

 

Section 3.  Piggyback Registration.  If at any time the Company proposes for any
reason to register Primary Shares or Other Shares under the Securities Act
(other than on Form S-4 or Form S-8 promulgated under the Securities
Act or any successor forms thereto and other than with respect to the IPO
Registration Statement) including any 

 

5

 

registration pursuant to the
exercise of the demand registration rights of any Person other than a Holder,
on any form that would also permit the registration of Registrable Shares, the
Company shall promptly give written notice to each Holder of its intention to
so register the Primary Shares or Other Shares and, upon the written request,
given within 15 days after delivery of any such notice by the Company, of any
Holder to include in such registration Registrable Shares held by such Holder
(which request shall specify the number of Registrable Shares proposed to be
included in such registration), the Company shall use its best efforts to cause
all such Registrable Shares to be included in such registration on the same
terms and conditions as the securities otherwise being sold in such
registration; provided, however, that if at any time after giving
written notice of its intention to register any securities, and prior to the
effective date of the registration statement filed in connection with such
registration, the Company shall determine for any reason not to proceed with
the proposed registration of the securities to be sold by it, the Company may,
at its election, give written notice of such determination to each Holder of
Registrable Shares and, thereupon, shall be relieved of its obligation to
register any Registrable Shares in connection with such registration; and, provided
further, however, that if

 

(a)  the
managing underwriter in connection with any proposed underwritten offering
initially proposed for the registration of Primary Shares advises the Company
that the inclusion of all Registrable Shares or Other Shares proposed to be
included in such registration would interfere with the successful marketing
(including pricing) of the Primary Shares proposed to be registered by the
Company, then the number of Primary Shares, Registrable Shares and Other Shares
proposed to be included in such registration shall be included in the following
order:

 

(i)  First,
the Primary Shares;

 

(ii)  Second,
the Registrable Shares held by all Selling Holders, pro rata based upon the
number of Registrable Shares owned by each such Selling Holder at the time of
such registration; and

 

(iii)  Third,
the Other Shares;

 

(b)  the
managing underwriter in connection with any proposed underwritten offering
initially proposed for the registration of Other Shares advises the Company
that the inclusion of all Registrable Shares or Primary Shares proposed to be
included in such registration would interfere with the successful marketing
(including pricing) of the Other Shares proposed to be registered by the
Company, then the number of Primary Shares, Registrable Shares and Other Shares
proposed to be included in such registration shall be included in the following
order:

 

(i)  First,
the Other Shares;

 

(ii)  Second,
the Primary Shares; and

 

6

 

(iii)  Third, the Registrable
Shares held by all Selling Holders, pro rata based upon the number of
Registrable Shares owned by each such Selling Holder at the time of such
registration.

 

In connection with any
underwritten offering under this Section 3, the Company shall not be
required to include Registrable Shares in such underwritten offering unless the
Holders of such Registrable Shares accept the terms of the underwriting of such
offering that have been agreed upon between the Company and the underwriters
selected by the Company, including without limitation, the underwriting
agreement and the fees and expenses in connection therewith.

 

Section 4.  Expenses.  The Company shall bear the expense of any
registrations effected pursuant to Sections 2 and 3 of this Agreement including
all registration and filing fees (including all expenses incident to filing
with the NASD), fees and expenses of complying with securities and blue sky
laws, printing expenses, and fees and expenses of the Company’s counsel and
accountants, and the reasonable and documented fees and expenses of the Selling
Holders’ Counsel, but excluding any underwriters’ or brokers’ discounts or
commissions, transfer taxes (to the extent that such taxes are required by law
to be paid by the Selling Holders) and the fees of any counsel to any Selling
Holder, other than the Selling Holders’ Counsel (it being understood that the
fees and expenses of any underwriter and such underwriter’s counsel shall be
the responsibility of such underwriter and the Selling Holders).

 

Section 5.  Preparation and Filing.  If and whenever the Company is under an
obligation pursuant to the provisions of this Agreement to use its best efforts
to effect the registration of any Registrable Shares under the Securities Act
or to assist in effecting a Takedown Offering, the Company shall, as
expeditiously as practicable and as applicable:

 

5.1.  with respect to a registration under Sections
2 and 3 of this Agreement, use its best efforts to cause a registration
statement that registers such Registrable Shares to become and remain effective
for a period of 180 days (or for three years, in the case of a Shelf Registration)
or until all of such Registrable Shares have been disposed of (if earlier), provided,
however, that the Company may discontinue any registration of its
securities that is being effected pursuant to Section 3 hereof at any time
prior to the effective date of the registration statement relating thereto;

 

5.2.  furnish, at least five business days (or one Business
Day in connection with a Takedown Offering) before filing a registration
statement that registers such Registrable Shares, a prospectus relating thereto
or to a Takedown Offering or any amendments or supplements relating to such a
registration statement or prospectus, to each holder of Registrable Shares, to
any Selling Holders and to the Selling Holders’ Counsel, copies of all such
documents proposed to be filed with the SEC (it being understood that such
five-business-day period need not apply to successive drafts of the same
document proposed to be filed so long as such successive drafts are supplied to
such counsel in advance of the proposed filing by a period of time that is
customary and reasonable under the circumstances);

 

7

 

5.3.  prepare and file with the SEC such amendments
and supplements to such registration statement and the prospectus used in
connection therewith as may be necessary to keep such registration statement
effective for at least the periods set forth in this Agreement or until all of
such Registrable Shares have been disposed of (if earlier) and to comply with
the provisions of the Securities Act with respect to the registration of the
sale or other disposition of such Registrable Shares;

 

5.4.  notify in writing the Selling Holders
promptly (i) of the receipt by the Company of any notification with
respect to any comments by the SEC with respect to such registration statement
or prospectus or any amendment or supplement thereto or any request by the SEC
for the amending or supplementing thereof or for additional information with
respect thereto, (ii) of the receipt by the Company of any notification
with respect to the issuance by the SEC of any stop order suspending the
effectiveness of such registration statement or prospectus or any amendment or
supplement thereto or the initiation or threatening of any proceeding for that purpose
and (iii) of the receipt by the Company of any notification with respect
to the suspension of the qualification of such Registrable Shares for sale in
any jurisdiction or the initiation or threatening of any proceeding for such
purposes;

 

5.5.  use its best efforts to register or qualify
such Registrable Shares covered by such registration statement under such other
securities or blue sky laws of such jurisdictions as any Selling Holder
reasonably requests and do any and all other acts and things which may be
reasonably necessary or advisable to enable such Selling Holder to consummate
the disposition in such jurisdictions of the Registrable Shares owned by such Selling
Holder; provided, however, that the Company will not be required
to qualify generally to do business, subject itself to general taxation or
consent to general service of process in any jurisdiction where it would not
otherwise be required so to do but for this Section 5.5;

 

5.6.  furnish to each Selling Holder on a timely
basis, such number of copies of a summary prospectus or other prospectus,
including a preliminary prospectus, in conformity with the requirements of the
Securities Act, and such other documents as such Selling Holder may reasonably
request in order to facilitate the public sale or other disposition of such
Registrable Shares;

 

5.7.  use its best efforts to cause such
Registrable Shares to be registered with or approved by such other governmental
agencies or authorities as may be necessary by virtue of the business and operations
of the Company to enable the seller or sellers thereof to consummate the
disposition of such Registrable Shares;

 

5.8.  during any period in which a prospectus
relating to such Registrable Shares is required to be delivered under the
Securities Act, notify on a timely basis each Selling Holder within the
appropriate period mentioned in Section 5.1, of the happening of any event
as a result of which the prospectus included in such registration statement, as
then in effect, includes an untrue statement of a material fact or omits to
state a material fact required to be stated therein or necessary to make the
statements therein not misleading in light of the circumstances then existing
and, at the request of such Selling Holder, prepare 

 

8

 

and furnish to such Selling
Holder a reasonable number of copies of a supplement to or an amendment of such
prospectus as may be necessary so that, as thereafter delivered to the offerees
of such shares, such prospectus shall not include an untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary to make the statements therein not misleading in light of the
circumstances then existing;

 

5.9.  make available for inspection by any counsel
to any Selling Holder and the Selling Holders’ Counsel or any underwriter
participating in any disposition pursuant to such registration statement and
any attorney, accountant or other agent retained by any such underwriter
(collectively, the “Inspectors”), all pertinent financial and other
records, pertinent corporate documents and properties of the Company
(collectively, the “Records”), as shall be reasonably necessary to
enable them to conduct their due diligence investigation, and cause the Company’s
officers, directors and employees to supply all information (together with the
Records, the “Information”) reasonably requested by any such Inspector
in connection with such registration statement. 
Any of the Information which the Company determines in good faith to be
confidential, and of which determination the Inspectors are so notified, shall
not be disclosed by the Inspectors unless (i) the disclosure of such
Information is necessary to avoid or correct a misstatement or omission of a
material fact in the registration statement, (ii) the release of such
Information is ordered pursuant to a subpoena or other order from a court of
competent jurisdiction or (iii) such Information has otherwise been made
generally available to the public.  The Selling
Holder agrees that it will, upon learning that disclosure of such Information
is sought in a court of competent jurisdiction, give notice to the Company and
allow the Company, at the Company’s expense, to undertake appropriate action to
prevent disclosure of the Information deemed confidential;

 

5.10.  use its best efforts to obtain from its
independent certified public accountants “comfort” letters in customary form
and at customary times and covering matters of the type customarily covered by
comfort letters;

 

5.11.  use its best efforts to obtain from its
counsel an opinion or opinions in customary form;

 

5.12.  provide a transfer agent and registrar (which
may be the same entity and which may not be the Company) for such Registrable
Shares;

 

5.13.  issue to any underwriter to which any Selling
Holder may sell shares in such offering certificates evidencing such
Registrable Shares;

 

5.14.  list such Registrable Shares on any national
securities exchange on which any shares of the Common Shares are listed or if
the Common Shares are not then listed on a national securities exchange, use
its best efforts to qualify such Registrable Shares for listing on such
national securities exchange as the holders of a majority of such Registrable
Shares shall request;

 

5.15.  otherwise use its best efforts to comply with
all applicable rules and regulations of the SEC and, if required under
such rules and regulations, make available 

 

9

 

to its security holders, as
soon as reasonably practicable, earnings statements (which need not be audited)
covering a period of 12 months beginning within three months after the
effective date of the registration statement, which earnings statements shall
satisfy the provisions of Section 11(a) of the Securities Act;

 

5.16.  use its best efforts to take all other steps
necessary to effect the registration of such Registrable Shares or the Takedown
Offering contemplated hereby; and

 

5.17.  use its best efforts to make available its
senior executive and financial officers to participate at the reasonable
request of any underwriter in marketing presentations to potential investors.

 

Section 6.  Indemnification.  

 

6.1.  In connection with any registration of any
Registrable Shares under the Securities Act or any Takedown Offering pursuant
to this Agreement, the Company shall indemnify and hold harmless each Selling
Holder, its officers and directors, each underwriter, broker or any other
person acting on behalf of such seller and each other person, if any, who
controls any of the foregoing persons within the meaning of the Securities Act
against any losses, claims, damages or liabilities, joint or several, (or
actions in respect thereof) to which any of the foregoing persons may become
subject under the Securities Act or otherwise, insofar as such losses, claims,
damages or liabilities (or actions in respect thereof) arise out of or are
based upon an untrue statement or alleged untrue statement of a material fact
contained in the registration statement under which such Registrable Shares
were registered under the Securities Act, any preliminary prospectus or final
prospectus contained therein or otherwise filed with the SEC, any amendment or
supplement thereto or any document incident to registration or qualification of
any Registrable Shares, or arise out of or are based upon the omission or
alleged omission to state therein a material fact required to be stated therein
or necessary to make the statements therein not misleading, and shall reimburse
such seller, such officer or director, such underwriter, such broker or such
other person acting on behalf of such seller and each such controlling person
for any legal or other expenses reasonably incurred by any of them in
connection with investigating or defending any such loss, claim, damage,
liability or action; provided, however, that the Company shall
not be liable in any such case to the extent that any such loss, claim, damage,
liability or action arises out of or is based upon (i) an untrue statement
or alleged untrue statement or omission or alleged omission made in said
registration statement, preliminary prospectus, final prospectus, amendment,
supplement or document incident to registration or qualification of any
Registrable Shares in reliance upon and in conformity with written information
furnished to the Company through an instrument duly executed by such seller or
underwriter specifically for use in the preparation thereof or (ii) offers
or sales by such Selling Holder “by means of” (as defined in Securities Act Rule 159A)
a “free writing prospectus” (as defined in Securities Act Rule 405) that
was not authorized in writing by the Company.

 

6.2.  In connection with any registration of
Registrable Shares under the Securities Act and each Takedown Offering pursuant
to this Agreement, each Selling Holder shall 

 

10

 

indemnify and hold harmless (in
the same manner and to the same extent as set forth in the preceding paragraph
of this Section) the Company, each director of the Company, each officer of the
Company who shall sign such registration statement, each underwriter, broker or
other person acting on behalf of the Company or such seller, each person who
controls any of the foregoing persons within the meaning of the Securities Act
and each other Selling Holder under such registration statement (i) with
respect to any statement or omission from such registration statement, any
preliminary prospectus or final prospectus contained therein or otherwise filed
with the SEC, any amendment or supplement thereto or any document incident to
registration or qualification of any Registrable Shares, if such statement or
omission was made in reliance upon and in conformity with written information
furnished to the Company or such underwriter through an instrument duly
executed by such seller specifically for use in connection with the preparation
of such registration statement, preliminary prospectus, final prospectus,
amendment, supplement or document and (ii) arises out of or is based upon
offers or sales by such Selling Holder “by means of” (as defined in Securities
Act Rule 159A) a “free writing prospectus” (as defined in Securities Act Rule 405)
that was not authorized in writing by the Company; provided, however,
that the obligation to indemnify will be several, not joint and several, among
such Selling Holders, and the maximum amount of liability in respect of such
indemnification shall be in proportion to and limited to, in the case of each Selling
Holder, an amount equal to the net proceeds actually received by such seller
from the sale of Registrable Shares effected pursuant to such registration.

 

6.3.  The Indemnification required by this Section 6
will be made by periodic payments during the course of the investigation or
defense, as and when bills are received or expenses incurred, subject to prompt
refund in the event any such payments are determined not to have been due and
owing hereunder.

 

6.4.  Promptly after receipt by an indemnified
party of notice of the commencement of any action involving a claim referred to
in the preceding paragraphs of this Section 6, such indemnified party
will, if a claim in respect thereof is made against an indemnifying party, give
written notice to the latter of the commencement of such action (it being
understood that no delay in delivering or failure to deliver such notice shall
relieve the indemnifying persons from any liability or obligation hereunder
unless (and then solely to the extent that) the indemnifying person is
prejudiced by such delay and/or failure). 
In case any such action is brought against an indemnified party, the
indemnifying party will be entitled to participate in and to assume the defense
thereof, jointly with any other indemnifying party similarly notified to the
extent that it may wish, with counsel reasonably satisfactory to such
indemnified party, and after notice from the indemnifying party to such
indemnified party of its election so to assume the defense thereof, the
indemnifying party shall not be responsible for any legal or other expenses
subsequently incurred by the latter in connection with the defense thereof; provided,
however, that if any indemnified party shall have reasonably concluded
that there may be one or more legal or equitable defenses available to such
indemnified party which are additional to or conflict with those available to
the indemnifying party, or that such claim or litigation involves or could have
an effect upon matters beyond the scope of the indemnity agreement provided in
this Section 6, the indemnifying party shall not have the right to assume
the defense of such action on behalf of such indemnified party and such 

 

11

 

indemnifying party shall
reimburse such indemnified party and any person controlling such indemnified
party for that portion of the fees and expenses of any counsel retained by the
indemnified party which is reasonably related to the matters covered by the
indemnity agreement provided in this Section 6.

 

6.5.  The indemnification provided for under this
Agreement will remain in full force and effect regardless of any investigation
made by or on behalf of the indemnified party or any officer, director or
controlling person of such indemnified party and will survive the transfer of
securities.

 

6.6.  If the indemnification provided for in this Section 6
is held by a court of competent jurisdiction to be unavailable to an
indemnified party with respect to any loss, claim, damage, liability or action
referred to herein, then the indemnifying party, in lieu of indemnifying such
indemnified party hereunder, shall contribute to the amounts paid or payable by
such indemnified party as a result of such loss, claim, damage, liability or
action in such proportion as is appropriate to reflect the relative fault of
the indemnifying party on the one hand and of the indemnified party on the
other in connection with the statements or omissions which resulted in such
loss, claim, damage or liability as well as any other relevant equitable
considerations.  The relative fault of
the indemnifying party and of the indemnified party shall be determined by
reference to, among other things, whether the untrue or alleged untrue
statement of a material fact or the omission or alleged omission to state a
material fact relates to information supplied by the indemnifying party or by
the indemnified party and the parties’ relative intent, knowledge, access to
information and opportunity to correct or prevent such statement or omission.  The Company and the Selling Holders agree
that it would not be just and equitable if contributions pursuant to this
paragraph were determined by pro rata allocation or by any other method of
allocation that did not take into account the equitable considerations referred
to herein.  The amount paid or payable to
an indemnified party as a result of the losses, claims, damages, liabilities or
expenses referred to above shall be deemed to include, subject to the
limitations set forth in Sections 6.2 and 6.1, any legal or other expenses
reasonably incurred in connection with investigating or defending the same.  Notwithstanding the foregoing, in no event
shall the amount contributed by a Selling Holder exceed the aggregate net
offering proceeds received by such seller from the sale of its Registrable
Shares.

 

Section 7.  Underwriting Agreement.  To the extent that the Company and the Selling
Holders shall enter into an underwriting or similar agreement, the Selling
Holders may, at their option, require that any or all of the representations
and warranties by, and the agreements on the part of, the Company to and for
the benefit of such underwriters be made to and for the benefit of such Selling
Holders and that any or all of the conditions precedent to the obligations of
such underwriters under such underwriting or similar agreement shall also be
conditions precedent to the obligations of such Selling Holders.  No underwriting or similar agreement in
connection with such offering shall require any such Selling Holder to make any
representations or warranties to or agreement with the Company or the
underwriters other than representations, warranties or agreements regarding
such holder, such holder’s Registrable Shares and such holder’s intended method
of distribution or any other representations required by applicable law and 

 

12

 

agreements regarding
indemnification and contribution to the effect provided in Section 6
hereof.  Notwithstanding the provisions
of Section 5 and 6, to the extent that the Company and the Selling Holders
shall enter into an underwriting or similar agreement, which agreement contains
provisions covering one or more issues addressed in such Sections 5 or 6, the
provisions contained in Sections 5 and 6 which address such issue or
issues shall be superseded with respect to such registration by such other
underwriting or similar agreement;

 

Section 8.  Agreements of the Selling Holders.  

 

8.1.  The Selling Holders shall furnish to the
Company such written information regarding such Selling Holders and the
distribution proposed by such Selling Holders as the Company may reasonably
request in writing and as shall be reasonably required in connection with any
registration, qualification or compliance referred to in this Agreement.

 

8.2.  No Selling Holder shall, nor shall any Selling
Holder permit any officer, director, underwriter, broker or any other person
acting on behalf of such Selling Holder to, use any free writing prospectus (as
defined in Rule 405 under the Securities Act) in connection with any
registration statement covering Registrable Shares, without the prior written
consent of the Company.

 

Section 9.  Exchange Act Compliance.  The Company shall comply with all of the
reporting requirements of the Exchange Act and with all other public
information reporting requirements of the SEC that are conditions to the
availability of Rule 144 for the sale of the Common Shares.  The Company shall cooperate with each Holder
supplying such information as may be necessary for such Holder to complete and
file any information reporting forms presently or hereafter required by the SEC
as a condition to the availability of Rule 144.

 

Section 10.  No Conflicting Registration Rights.  The Company represents and warrants to each Holder
that the registration rights granted hereby do not conflict with any other
registration rights granted by the Company. 
The Company shall not, after the date hereof, grant any registration
rights that conflict with the registration rights granted hereby, or agree to
any registration rights that restrict the ability of each Holder to piggy-back
on other registration statements (except pursuant to standard cut-back
provisions).

 

Section 11.  Transfer of Registration Rights.  The rights of each Holder under this
agreement may be assigned to any direct or indirect transferee of a Holder who (a) agrees
in writing to be subject to and be bound by all terms and conditions of this
Agreement and (b) provides such contact information as is necessary in
order to receive all notices, requests, consents and other communications
required or permitted hereunder.

 

Section 12.  Enforcement.  

 

12.1.  Remedies at Law or in Equity.  Each Holder, on the one hand, or the Company
on the other hand, may proceed to protect and enforce its rights by suit in
equity or action at law, whether for the specific performance of any term
contained in this 

 

13

 

Agreement or for an injunction
against the breach of any such term or in aid of the exercise of any term
contained in this Agreement, or to enforce any other legal or equitable right
of such Holder, on the one hand, or the Company on the other hand, or to take
any one or more of such actions.

 

In the event a
Holder brings such an action against the Company or the Company brings an
action against a Holder arising under this Agreement, the prevailing party in
such dispute shall be entitled to recover from the losing party all fees, costs
and expenses of enforcing any right of such prevailing party under or with
respect to this Agreement, including without limitation such reasonable fees
and expenses of attorneys and accountants, which shall include, without
limitation, all fees, costs and expenses of appeals.

 

12.2.  Cumulative Remedies.  None of the rights, powers or remedies
conferred upon a Holder on the one hand, or the Company on the other hand,
shall be mutually exclusive, and each such right, power or remedy shall be
cumulative and in addition to every other right, power or remedy, now or
hereafter available at law, in equity, by statute or otherwise.

 

12.3.  No Implied Waiver.  Except as expressly provided in this
Agreement, no course of dealing between the Company and a Holder and no delay
in exercising any such right, power or remedy conferred hereby now or hereafter
existing at law in equity, by statute or otherwise, shall operate as a waiver
of, or otherwise prejudice, any such right, power or remedy.

 

Section 13.  Miscellaneous.  

 

13.1.  Waivers and Amendments.  Upon the approval of the Company and the
written consent of the holders of a majority of the Registrable Securities the
obligations of the Company and the rights of each Holder under this Agreement
may be waived (either generally or in a particular instance, either
retroactively or prospectively and either for a specified period of time or
indefinitely).

 

Upon the
effectuation of each such waiver, the Company shall promptly give written
notice thereof to each Holder who have not previously consented thereto in
writing.

 

Neither this
Agreement, nor any provision hereof, may be changed, waived, discharged or
terminated orally or by course of dealing, but only by a statement in writing
signed by the party against which enforcement of the change, waiver, discharge
or termination is sought, except to the extent provided in this Section 13.1.

 

13.2.  Notices.  All notices, requests, consents and other
communications required or permitted hereunder shall be in writing and shall be
hand delivered or mailed postage prepaid by registered or certified mail,

 

14

 

(a)  If
to White Mountains:

 

White
Mountains  Insurance Group, Ltd.

80 South Main Street

Hanover, NH 30753

Attention: Dennis Beaulieu 

Telephone No.: (603) 640-2206

Telecopy No: (603) 533-0934

 

or (b) If to a Holder other than White
Mountains, to such address as is provided by the Holder to the Company,

 

or (c) If to the Company:

 

OneBeacon
Insurance Group, Ltd.

One Beacon Street

Boston, MA 02108

Attention: Thomas L. Forsyth, Esq.

Telephone No.: 617-725-6000

Telecopy No.:

 

with a copy
(which shall not constitute notice) to:

Cravath, Swaine & Moore LLP

825 Eighth Avenue

New York, NY 10019

Attention: William J. Whelan III, Esq.

Telephone No.: 212-474-1000

Telecopy No.: 212-474-3700; and

 

or at such
other address as the Company or a Holder each may specify by written notice to
the other, and each such notice, request, consent and other communication shall
for all purposes of the Agreement be treated as being effective or having been
given (i) when delivered if delivered personally, (ii) when sent, if
sent by telecopy on a business day (or, if not sent on a business day, on the
next business day after the date sent by telecopy), (iii) on the next
business day after dispatch, if sent by a nationally recognized overnight
courier guaranteeing next business day delivery, or, (iv) if sent by mail,
at the earlier of its receipt or 72 hours after the same has been deposited in
a regularly maintained receptacle for the deposit of United States mail,
addressed and postage prepaid as aforesaid.

 

13.3.  Termination of Agreement.  This Agreement shall remain in effect until
the later of (i) the date upon which no Registrable Shares shall remain
outstanding and (ii) the date upon which all Registrable Shares eligible
to be sold pursuant to a registration statement shall have been sold; provided,
however, that Sections 4 and 6 shall survive the termination of
this Agreement.

 

13.4.  Severability.  Should any one or more of the provisions of
this Agreement or of any agreement entered into pursuant to this Agreement be
determined to be illegal or unenforceable, all other provisions of this
Agreement and of each other agreement 

 

15

 

entered into pursuant to this
Agreement shall be given effect separately from the provision or provisions
determined to be illegal or unenforceable and shall not be affected thereby.

 

13.5.  Parties in Interest.  All the terms and provisions of this Agreement
shall be binding upon and inure to the benefit of and be enforceable by the
respective parties hereto, the successors and assigns of each Holder and the
Company, whether so expressed or not.  This
Agreement shall not run to the benefit of or be enforceable by any other
Person.

 

13.6.  Headings.  The headings of the Sections and paragraphs
of this Agreement have been inserted for convenience of reference only and do
not constitute a part of this Agreement.

 

13.7.  Choice of Law.  It is the intention of the parties that the
internal laws, and not the laws of conflicts, of New York should govern the
enforceability and validity of this Agreement, the construction of its terms
and the interpretation of the rights and duties of the parties.

 

13.8.  Counterparts.  This Agreement may be executed in any number
of counterparts and by different parties hereto in separate counterparts, with
the same effect as if all parties had signed the same document.  All such counterparts shall be deemed an
original, shall be construed together and shall constitute one and the same
instrument.

 

13.9.  Entire Agreement.  This Agreement contains the entire agreement
among the parties hereto with respect to the subject matter hereof and such
Agreement supersedes and replaces all prior agreements, written or oral, among
the parties hereto with respect to the subject matter hereof.

 

* * * * *

 

16

 

IN WITNESS
WHEREOF, the parties hereto have caused this Registration Rights Agreement to
be duly executed as of the day and year first above written.

 

	
   

  	
  ONEBEACON INSURANCE GROUP, LTD.,

  
	
   

  	
   

  	
   

  
	
   

  	
  by

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  WHITE MOUNTAINS INSURANCE 

  GROUP, LTD.,

  
	
   

  	
   

  	
   

  
	
   

  	
  by 

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Name:

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  

 

17Exhibit 10.3.1

 

FORM OF

INVESTMENT MANAGEMENT AGREEMENT

 

                WHITE MOUNTAINS ADVISORS
LLC, a Delaware limited liability company (the “Advisor”),
having an address at 370 Church Street, Guilford, Connecticut 06437, and ONEBEACON INSURANCE GROUP, LTD AND ITS SUBSIDIARIES., a Bermuda corporation (the “Client”), having an address at Bank
of Butterfield Building, 42 Reid Street, Hamilton, HM 12, Bermuda, hereby enter into this Investment Management Agreement, dated as of [November
11, 2006] (this “Agreement”), and hereby agree that the Advisor shall
act as discretionary adviser with respect to the assets of the Client described
below (the “Investment Account”) on the following terms and conditions:

                1.             Investment
Account.  The Investment Account
shall consist of cash and the securities of the Client.

                2.             Services
of Advisor.  By execution of this
Agreement, the Advisor accepts appointment as adviser for the Investment
Account with full discretion and agrees to supervise and direct the investments
of the Investment Account in accordance with the investment objectives,
policies and restrictions described in the investment guidelines attached
hereto as Schedule A (the “Investment Guidelines”).  The Investment Guidelines are for the stated
purpose of assisting the Advisor in the performance of its investment
duties.  The Advisor will manage the
Investment Account in accordance with such Investment Guidelines as provided to
the Advisor from time to time.  In
addition, the Advisor agrees to provide treasury management advisory services
specific to the Investment Account (“Treasury Management Services”), as
directed by the Client.  The Treasury
Management Services include, without limitation, (i) executing investment
transactions to support short-term treasury cash requirements, (ii) settling
inter-company and dividend treasury transactions with cash and securities, (iii)
settling quarterly tax liability payments from the Investment Account, (iv) providing
preliminary valuation for securities supporting treasury transactions, (v) assisting
the Client in evaluating securities lending programs administered by custodians
designated by the Client and acceptable to the Advisor, and (vi) collaborating
with the Client to provide treasury transaction support to custodians and accounting
servicing providers designated by the Client and acceptable to the Advisor.

                3.             Discretionary
Authority.  Advisor shall have full
discretion and authority, without obtaining any prior approval, as the Client’s
agent and attorney-in-fact: (a) to make all investment
decisions in respect of the Investment Account on the Client’s behalf and at
the Client’s sole risk; (b) to buy, sell, exchange, convert, liquidate or
otherwise trade in any stock, bond and other securities in respect of the
Investment Account; (c) to place orders with respect to, and to arrange
for, any of the foregoing; and (d) in furtherance of the foregoing, to do
anything which the Advisor shall deem requisite, appropriate or advisable in
connection therewith, including, without limitation, the selection of such
brokers, dealers, and others as the Advisor shall determine in its absolute
discretion.

                4.             Liability.  In the performance of its services, the
Advisor will not be liable for any error in judgment or any acts or failures to
act except those resulting from the Advisor’s gross negligence, willful
misconduct or malfeasance.  Nothing
herein shall in any way constitute a waiver or limitation of any right of any
person under the federal securities laws. 
The Advisor shall have no 

 

1

 

responsibility
whatsoever for the management of any assets of the Client other than the
Investment Account.

                5.             Custody.  The assets of the Investment Account shall be
held in one or more separately identified accounts in the custody of one or
more banks, trust companies, brokerage firms or other entities designated by
the Client and acceptable to the Advisor. 
The Advisor will communicate its investment purchase, sale and delivery
instructions directly with the Client’s custodian or other qualified
depository.  The Client shall be
responsible for all custodial arrangements and the payment of all custodial
charges and fees, and the Advisor shall have no responsibility or liability with
respect to custody arrangements or the acts, omissions or other conduct of the
custodians.

                6.             Brokerage.  When placing orders for the execution of
transactions for the Investment Account, the Advisor may allocate all
transactions to such brokers or dealers, for execution on such markets, at such
prices and commission rates, as are selected by the Advisor in its sole
discretion.  In selecting brokers or
dealers to execute transactions, the Advisor need not solicit competitive bids
and does not have an obligation to seek the lowest available commission
cost.  It is not the Advisor’s practice
to negotiate “execution only” commission rates, and, in negotiating commission
rates, the Advisor shall take into account the financial stability and
reputation of brokerage firms and brokerage and research services provided by
such brokers.  The Client may be deemed
to be paying for research provided or paid for by the broker which is included
in the commission rate although the Client may not, in any particular instance,
be the direct or indirect beneficiary of the research services provided.  Research furnished by brokers may include,
but is not limited to, written information and analyses concerning specific
securities, companies or sectors; market, finance and economic studies and
forecasts; financial publications; statistics and pricing services; discussions
with research personnel; and software and data bases utilized in the investment
management process.  The Client
acknowledges that since commission rates are generally negotiable, selecting
brokers on the basis of considerations which are not limited to applicable
commission rates may at times result in higher transaction costs than would
otherwise be obtainable.  The Advisor is
hereby authorized to, and the Client acknowledges that the Advisor may,
aggregate orders on behalf of the Investment Account with orders on behalf of
other clients of the Advisor.  In such
event, allocation of the securities purchased or sold, as well as expenses
incurred in the transaction, shall be made in a manner which the Advisor
considers to be the most fair and equitable to all of its clients, including
the Client.

                7.             Representations and
Warranties.

(a)            The Client represents, warrants, covenants
and agrees that:

(i)        it has full legal power and authority to
enter into this Agreement;

(ii)                      the appointment
of the Advisor hereunder is permitted by the Client’s governing documents and
has been duly authorized by all necessary corporate or other action; and

(iii)                         it will
indemnify the Advisor and hold it harmless against any and all  losses, costs, claims and liabilities which
the Advisor may suffer or

 

2

 

                                          incur arising
out of any material breach of these representations and warranties of the
Client.

                                (b)  
The Advisor represents, warrants, covenants and agrees that:

                                                                                                                              (i)        it has full legal power and authority to
enter into this Agreement;

                                                                                                      (ii)         it is registered as an investment
adviser with the Securities and Exchange Commission pursuant to the Investment
Advisers Act of 1940, as amended (the “Advisers Act”);

                                                                                    (iii)        entering into this Agreement has been
duly authorized by all necessary corporate or other action under the Advisor’s
governing document; and

                                                                                                                        (iv)        it will indemnify the Client and hold it harmless against any and all losses, costs, claims
and liabilities which the Client may suffer or incur arising out of any material
breach of any representations and warranties of the Advisor.

8.             Reports.  The Advisor shall provide the Client with reports
containing the status of the Investment Account at least monthly (i.e. FLASH
Report), and will provide written advisory report letters to the Client on a
quarterly basis.  The Advisor shall also
provide the Client with preliminary valuation of the Investment Account on a
monthly basis.  The preliminary valuation
will be determined in accordance with the Advisor’s valuation policies and
procedures, a copy of which shall be provided to the Client at least
annually.  All records maintained
pursuant to this Agreement shall be subject to examination by the Client and by
persons authorized by it, or by appropriate governmental authorities, at all
times upon reasonable notice.  The
Advisor shall provide copies of trade tickets, custodial reports and other
records the Client reasonably requires for accounting or tax purposes.

                9.             Management
Fee, Treasury Management Fee and Expenses.

                                (a)   The Advisor will be paid a quarterly
management and treasury management fee (the “Management Fee”) for its
investment advisory and treasury management services provided hereunder,
determined in accordance with Schedule B to this Agreement.  During the term of this Agreement, the
Management Fee shall be billed and payable in arrears on a quarterly basis
within 10 days after the last day of each calendar quarter based upon the value
of the Investment Account as of the last day of the immediately preceding
calendar quarter.  The Management Fee
shall be pro-rated for any partial quarter. 
Capital inflows and outflows result in an adjustment to the value of
assets under management that serves as the base of the Management Fee.  This adjustment has the effect of
time-weighting capital flows in the account resulting in the Management Fee
being properly charged for only the period of time such assets are actually managed
by the Advisor.  It is understood that,
in the event that the Management Fee is to be paid by the custodian out of the
Investment Account, the Client will provide written authorization to the
custodian to pay the Management Fee directly from the Investment Account.

                                (b)
 The Client shall be responsible for all
expenses incurred directly in connection with transactions effected on behalf
of the Client pursuant to this Agreement and shall include:  custodial fees; PAM accounting service fees, Charles
River compliance service fees, investment 

 

3

 

expenses such as
commissions; and other expenses reasonably related to the purchase, sale or
transmittal of Investment Account assets (other than research fees and expenses
with respect to the Investment Account).

                10.           Confidential
Relationship.  All information and
advice furnished by either party to the other party pursuant to this Agreement
shall be treated by the receiving party as confidential and shall not be
disclosed to third parties except as required by law.

                11.           Assignment.  This agreement may not be assigned (within
the meaning of the Advisers Act) by either party without the written consent of
the other party, and any assignment without such consent shall automatically
cause the termination hereof.

                12.           Directions
to the Advisor.  All directions by or
on behalf of the Client to the Advisor shall be in writing signed by or on
behalf of the Client.  The Advisor shall
be fully protected in relying upon any such writing which the Advisor believes
to be genuine and signed or presented by the proper person or persons, shall be
under no duty to make any investigation or inquiry as to any statement
contained therein and may accept the same as conclusive evidence of the truth
and accuracy of the statements therein contained.

                13.           Services
to Other Clients.  It is understood
that the Advisor acts as investment adviser to other clients and may give
advice and take action with respect to such clients that differs from the
advice given or the action taken with respect to the Investment Account.  Nothing in this Agreement shall restrict the
right of the Advisor, its members, managers, officers, employees or affiliates
to perform investment management or advisory services for any other person or
entity, and the performance of such service for others shall not be deemed to
violate or give rise to any duty or obligation to the Client.

                14.           Investment
by the Advisor for Its Own Account. 
Nothing in this Agreement shall limit or restrict the Advisor or any of
its members, managers, officers, employees or affiliates from buying, selling
or trading any securities for its or their own account or accounts.  The Client acknowledges that the Advisor and
its members, managers, officers, employees, affiliates and other clients may at
any time have, acquire, increase, decrease or dispose of securities which are
at or about the same time acquired or disposed of for the account of the
Client.  The Advisor shall have no
obligation to purchase or sell for the Investment Account or to recommend for
purchase or sale by the Investment Account any security that the Advisor or its
members, managers, officers, employees or affiliates may purchase or sell for
itself or themselves or for any other client.

                15.           Proxies.  Subject to any other written instructions of
the Client, the Advisor is hereby appointed as the Client’s agent and
attorney-in-fact in its discretion to vote, convert or tender in an exchange or
tender offer any securities in the Investment Account, to execute proxies,
waivers, consents and other instruments with respect to such securities, to
endorse, transfer or deliver such securities and to participate in or consent
to any plan of reorganization, merger, combination, consolidation, liquidation
or similar plan with reference to such securities, and the Advisor shall not
incur any liability to the Client by reason of any exercise of, or failure to
exercise, any such discretion.

                16.           Notices.  All
notices and instructions with respect to securities transactions or any other
matters contemplated by this Agreement shall be deemed duly given when
delivered in 

 

4

 

writing,
via electronic communications or deposited by first-class mail to the following
addresses: (a) if to the Advisor, at its address set forth above, Attention: Chief
Financial Officer, or (b) if to the Client, at its address set forth above,
Attention: Chief Financial Officer.  The
Advisor or the Client may change its address or specify a different manner of
addressing itself by giving notice of such change in writing to the other
party.

                17.           Entire
Agreement; Amendment.  This Agreement
sets forth the entire agreement of the parties with respect to management of
the Investment Account and shall not be amended except by an instrument in
writing signed by the parties hereto.

                18.           Arbitration.  Any controversy or claim arising out of or
relating to this Agreement, or the breach of the same, shall be settled by
arbitration in accordance with the rules of the American Arbitration
Association, and judgment upon the award rendered by the arbitrators may be
entered in any court having jurisdiction. 
All arbitration expenses shall be borne equally by the Advisor and the
Client.

                19.           Termination.  This Agreement shall continue in force in
accordance with paragraph 21, Effective Date and Term of this Agreement.  During such term, this Agreement may be
terminated by the Client upon written notice to the Advisor at least sixty (60)
days prior to the date upon which such termination is to become effective only
(i) for cause (including material non-performance by the Advisor), (ii) if
there is a change in control of the Advisor (for this purpose, a change in
control represents 50% or more of voting interest of the Advisor) or (iii) if
White Mountains Insurance Group, Ltd.’s voting interest in Client falls below
50%.  Following the end of the initial fixed
term and any extensions, as provided by paragraph 21, Effective Date and
Term of this Agreement, the Agreement may be terminated by either party
without penalty by written notice to the other party at least sixty (60) days
prior to the date upon which such termination is to become effective, provided
that the Client shall honor any trades executed but not settled before the date
of any such termination.  Upon
termination of this Agreement, any accrued and unpaid Management Fee and
Treasury Management Fee hereunder shall be paid by the Client to the Advisor.

                20.           Governing
Law.  To the extent that the
interpretation or effect of this Agreement shall depend on state law, this Agreement shall be governed by and construed
in accordance with the laws of the State of New York.

                21.
          Effective
Date and Term.  This Agreement shall
become effective on the first date written above for an initial fixed term of
three years, which will be extendible by the Client for an additional one year
(a fourth year) at/prior to the end of the second year of the term, and if so
extended, for a second additional year (a fifth year) at/prior to the end of
the third year of the term.

                22.           Receipt
of Disclosure Statement.  The Client
acknowledges receipt of a copy of Part II of the Advisor’s Form ADV in
compliance with Rule 204-3(b) under the Investment Advisers Act of 1940, as amended,
more than 48 hours prior to the date of execution of this Agreement.  The Advisor shall annually and without
charge, upon request by the Client, deliver to the Client the current version
of such form or a written document containing at least the information then
required to be contained in such form.

 

5

 

                23.           Counterparts. 
This Agreement may be executed in two counterparts, each one of which
shall be deemed to be an original.

IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed
by their respective duly authorized representatives as of the date first
written above.

 

	
  ADVISOR:

  	
  CLIENT:

  	
   

  
	
   

  	
   

  	
   

  
	
  WHITE
  MOUNTAINS ADVISORS, LLC

  	
  ONEBEACON
  INSURANCE GROUP, LTD.

  
	
   

  	
   

  	
   

  	
   

  
	
  By:

  	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Print:

  	
   

  	
   

  	
  Print:

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Title:

  	
   

  	
   

  	
  Title:

  	
   

  
						

 

 

6

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