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v3.23.3

Share Capital | 9 Months Ended
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Sep. 30, 2023
Equity [Abstract] |
Share Capital | Share Capital Authorized and Issued Hamilton Group’s share capital at September 30, 2023 and December 31, 2022, is comprised as follows:
(Expressed in thousands of U.S. Dollars, except share information) |  |  |
Authorized: |  |  |
150,000,000 common shares of $0.01 par value each |  |  |
Issued, outstanding and fully paid: | 2023 |  | 2022
Class A common shares (2023 and 2022: 30,520,078) | $ | 305 |  |  | $ | 305 |
Class B common shares (2023: 42,658,302 and 2022: 42,042,155) | 427 |  |  | 420 |
Class C common shares (2023 and 2022: 30,525,626) | 305 |  |  | 305 |
Total | $ | 1,037 |  |  | $ | 1,030 |
The following is a summary of the activity related to common shares authorized for the three months ended September 30, 2023 and 2022:
| 2023
| Class A |  | Class B |  | Class C |  | Total
Common shares - beginning of period | 53,993,690 |  |  | 50,480,684 |  |  | 30,525,626 |  |  | 135,000,000 |
Increase in authorized share capital | — |  |  | 15,000,000 |  |  | — |  |  | 15,000,000 |
Common shares - end of period | 53,993,690 |  |  | 65,480,684 |  |  | 30,525,626 |  |  | 150,000,000 |
| 2022
| Class A |  | Class B |  | Class C |  | Total
Common shares - beginning of period | 53,993,690 |  |  | 48,984,123 |  |  | 32,022,187 |  |  | 135,000,000 |
Share class conversions | — |  |  | 1,496,561 |  |  | (1,496,561) |  |  | — |
Common shares - end of period | 53,993,690 |  |  | 50,480,684 |  |  | 30,525,626 |  |  | 135,000,000 |
The following is a summary of the activity related to common shares authorized for the nine months ended September 30, 2023 and 2022:
| 2023
| Class A |  | Class B |  | Class C |  | Total
Common shares - beginning of period | 53,993,690 |  |  | 50,480,684 |  |  | 30,525,626 |  |  | 135,000,000 |
Increase in authorized share capital | — |  |  | 15,000,000 |  |  | — |  |  | 15,000,000 |
Common shares - end of period | 53,993,690 |  |  | 65,480,684 |  |  | 30,525,626 |  |  | 150,000,000 |
| 2022
| Class A |  | Class B |  | Class C |  | Total
Common shares - beginning of period | 53,793,690 |  |  | 46,898,612 |  |  | 34,307,698 |  |  | 135,000,000 |
Share class conversions | 200,000 |  |  | 3,582,072 |  |  | (3,782,072) |  |  | — |
Common shares - end of period | 53,993,690 |  |  | 50,480,684 |  |  | 30,525,626 |  |  | 135,000,000 |
The following is a summary of the activity related to common shares issued and outstanding for the three months ended September 30, 2023 and 2022:
| 2023
| Class A |  | Class B |  | Class C |  | Total
Common shares - beginning of period | 30,520,078 |  |  | 42,638,190 |  |  | 30,525,626 |  |  | 103,683,894 |
Director share awards granted | — |  |  | 20,112 |  |  | — |  |  | 20,112 |
Common shares - end of period | 30,520,078 |  |  | 42,658,302 |  |  | 30,525,626 |  |  | 103,704,006 |
| 2022
| Class A |  | Class B |  | Class C |  | Total
Common shares - beginning of period | 30,520,078 |  |  | 40,497,039 |  |  | 32,022,187 |  |  | 103,039,304 |
Share class conversions | — |  |  | 1,496,561 |  |  | (1,496,561) |  |  | — |
Employee and director share purchases | — |  |  | 22,750 |  |  | — |  |  | 22,750 |
Director share awards granted | — |  |  | 25,805 |  |  | — |  |  | 25,805 |
Common shares - end of period | 30,520,078 |  |  | 42,042,155 |  |  | 30,525,626 |  |  | 103,087,859 |
The following is a summary of the activity related to common shares issued and outstanding for the nine months ended September 30, 2023 and 2022:
| 2023
| Class A |  | Class B |  | Class C |  | Total
Common shares - beginning of period | 30,520,078 |  |  | 42,042,155 |  |  | 30,525,626 |  |  | 103,087,859 |
Vesting of awards | — |  |  | 735,013 |  |  | — |  |  | 735,013 |
Director share awards granted | — |  |  | 44,892 |  |  | — |  |  | 44,892 |
Share repurchases | — |  |  | (163,758) |  |  | — |  |  | (163,758) |
Common shares - end of period | 30,520,078 |  |  | 42,658,302 |  |  | 30,525,626 |  |  | 103,704,006 |
| 2022
| Class A |  | Class B |  | Class C |  | Total
Common shares - beginning of period | 30,320,078 |  |  | 37,935,266 |  |  | 34,307,698 |  |  | 102,563,042 |
Share class conversions | 200,000 |  |  | 3,582,072 |  |  | (3,782,072) |  |  | — |
Vesting of awards | — |  |  | 580,935 |  |  | — |  |  | 580,935 |
Employee and director share purchases | — |  |  | 22,750 |  |  | — |  |  | 22,750 |
Director share awards granted | — |  |  | 25,805 |  |  | — |  |  | 25,805 |
Share repurchases | — |  |  | (104,673) |  |  | — |  |  | (104,673) |
Common shares - end of period | 30,520,078 |  |  | 42,042,155 |  |  | 30,525,626 |  |  | 103,087,859 |
In general, holders of Class A common shares and Class B common shares have one vote for each common share held while the Class C common shares have no voting rights, except as required by law. However, each holder of Class A common shares and Class B common shares is limited to voting (directly, indirectly or constructively, as determined for U.S. federal income tax purposes) that number of common shares equal to 9.5% of the total combined voting power of all classes of shares of the Company (or, in the case of a class vote by the holders of our Class B common shares, such as in respect of the election or removal of directors other than for directors who are appointed by certain shareholders pursuant to the Shareholders Agreement and our Bye-laws, a maximum of 14.92% of the total combined voting power). In addition, the Board of Directors may limit a shareholder’s voting rights when it deems it appropriate to do so to avoid certain material adverse tax, legal or regulatory consequences to the Company or any direct or indirect shareholder or its affiliates. The Company Bye-laws provide for the redesignation of shares from (i) Class A common shares to Class B common shares automatically upon any transfer, whether or not for value, from (ii) Class B common shares to Class A common shares at the request of a Class A member and upon approval by a Simple Majority of the Board, from (iii) Class A common shares and Class B common shares to Class C common shares at the request of the transferring shareholder and subject to approval by a Simple Majority of the Board and, (iv) from Class C common shares to Class B common shares upon approval by a Simple Majority of the Board. Effective upon listing on the New York Stock Exchange ("NYSE"), the Company Bye-laws provide for the redesignation of shares, as described in (i)-(iv) above, automatically upon transfer. The number of authorized and issued Class A common shares and Class C common shares, as applicable, shall be reduced by the aggregate number of such issued Class A common shares and Class C common shares, as applicable, converted to Class B common shares and the number of authorized and issued Class B common shares shall be correspondingly increased by the same amount. Certain of Hamilton Group’s shareholders that own an aggregate of 62.0 million Class A, Class B and Class C common shares at September 30, 2023 have liquidity rights stipulating that on either December 23, 2023, or at the end of each three-year period thereafter, or upon the occurrence of a Trigger Event (as such term is defined in the Second Amended and Restated Shareholders' Agreement), such shareholders may cause, at the Company’s election, for the Company to either repurchase all or any portion of the exercised common shares held by such shareholder(s) at diluted book value or require an auction for a cash sale of the Company, at the Company's option. For purposes of these liquidity rights a Trigger Event includes any of the following: (i) various adverse tax determinations, including if the Company is determined to be a “passive foreign investment company” for U.S. federal income tax purposes; (ii) various changes in law that have material adverse consequences to either the Company or the applicable shareholders' interests in the Company; (iii) a downgrade in any material subsidiary’s financial strength rating to any level below A- by A.M. Best Company; or (iv) one or more changes in law (including regulatory requirements) that in the aggregate result in (a) a reduction in the investable assets of the Company invested with Two Sigma specifically, or alternative investment managers employing similar strategies generally, such that 75% or less of the Company’s investable assets will be invested with Two Sigma or such alternative investment managers or (b) Two Sigma specifically, or alternative investment managers employing similar strategies generally, being required to adopt a materially different investment strategy with respect to the investable assets of the Company. Should the Company elect to repurchase all or a portion of the common shares held by such exercising shareholder(s), such repurchase is subject to (i) applicable law and (ii) reasonable determination by the Board of Directors that A.M. Best Company will not downgrade or take any ratings action with respect to Hamilton Re’s financial strength rating as a result. Effective upon listing on the NYSE, a new shareholders' agreement was executed between the Company and certain significant shareholders, and the liquidity rights described above no longer apply.

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