Allied World Sponsored Formation of Vault Reciprocal Exchange

Allied World sponsored formation of Vault Reciprocal Exchange (“Vault”) domiciled in Florida

• Vault is a reciprocal insurance exchange catering to the high net-worth Personal Insurance market
• Vault was initially focused on Florida with plans to diversify into other states
• Vault’s attorney-in-fact, Vault Risk Management (“VRM”), manages Vault’s day-to-day operations
• Allied World provided financial, strategic, and reinsurance support as the founding sponsor
  • Allied World owned a majority of Vault and clients of Hudson Structured owned a minority interest at the time of the transaction

Vault capitalized with a surplus note commitment

• Commitment from Allied World and Hudson Structured
• Proceeds used to capitalize Vault’s initial surplus and support Vault’s growth prospects

VRM’s management team has a proven track record in the HNWM space

• Led by Chief Executive Officer Charles Williamson who has over 30 years of industry experience

Allied World is a leading global specialty (re)insurer

• Financial strength rating of “A (Excellent)” from A.M. Best
• Consolidated shareholders equity of $3.6bn as of 3/31/17
• Part of the Fairfax Financial family following its sale to Fairfax on 7/6/2017

TCMA acted as Transaction Advisor to Allied World and Placement Agent for Vault

• Provided objective advice and acted as a confidant to Allied World throughout the process
• Placement agent in connection with Vault surplus note security issuance
• Key transaction steps led by TCMA included:
  • Assistance in preparing Vault business plan and financial projections
  • Assistance in preparing A.M. Best materials to achieve desired “A- (Excellent)” rating
  • Assistance in design of Vault’s reinsurance program
  • Assistance in preparing financial packages and materials for potential surplus note investors
  • Marketing the transaction to potential surplus note investors and introducing the counterparties
  • Offering insight around surplus note offering transaction terms & conditions