Arch Capital Group Ltd. (NASDAQ:ACGL) Files An 8-K Entry into a Material Definitive Agreement

On December 8, 2016, Arch Capital Finance LLC (the Issuer), a
wholly-owned subsidiary of Arch Capital Group Ltd. (the Company),
completed the public offering of $500,000,000 aggregate principal
amount of its 4.011% senior notes due 2026 (2026 Notes) and
$450,000,000 aggregate principal amount of 5.031% senior notes
due 2046 (2046 Notes and, together with the 2026 Notes, the
Senior Notes), fully and unconditionally guaranteed by the
Company (the Guarantee). The Senior Notes have been registered
under the Securities Act of 1933, as amended (the Securities
Act), to the Companys universal shelf registration statement on
Form S-3 (File No. 333-202440), as supplemented by the prospectus
supplement dated November 29, 2016, previously filed with the
Securities and Exchange Commission under the Securities Act.

The Senior Notes were issued (and the Guarantee delivered) to an
indenture (the Base Indenture), dated as of December 8, 2016,
among the Issuer, the Company and The Bank of New York Mellon, as
trustee (the Trustee), as supplemented by a First Supplemental
Indenture among the Issuer, the Company and the Trustee, dated as
of December 8, 2016 (the First Supplemental Indenture together
with the Base Indenture, the Indenture). The Senior Notes and the
Guarantee are unsecured and unsubordinated obligations of the
Issuer and the Company, respectively, and rank equally and
ratably with the other unsecured and unsubordinated indebtedness
of the Issuer and the Company. Copies of the Base Indenture and
the First Supplemental Indenture (including the form of Senior
Notes) are attached hereto as Exhibits 4.1 and 4.2 respectively,
and are incorporated herein by reference. The description of the
Indenture and the Senior Notes in this report are summaries and
are qualified in their entirety by the terms of the Indenture and
the form of Senior Note.

The Issuer will pay interest on the Senior Notes semi-annually in
arrears on June 15 and December 15, beginning on June 15, 2017,
to holders of record on the preceding June 1 or December 1, as
the case may be. Interest will be calculated on the basis of a
360-day year of twelve 30-day months.

Unless previously redeemed, the 2026 Notes will mature on
December 15, 2026, and the 2046 Notes will mature on December 15,
2046. At any time and from time to time prior to September 15,
2026, the 2026 notes will be redeemable at the Issuers option, in
whole or in part, at a redemption price equal to the make-whole
redemption price, plus accrued and unpaid interest. At any time
and from time to time on or after September 15, 2026, the 2026
notes will be redeemable at the Issuers option, in whole or in
part, at a redemption price equal to 50% of the principal amount
of the 2026 notes to be redeemed, plus accrued and unpaid
interest thereon to, but excluding, the redemption date. At any
time and from time to time prior to June 15, 2046, the 2046 notes
will be redeemable at the Issuers option, in whole or in part, at
a redemption price equal to the make-whole redemption price, plus
accrued and unpaid interest. At any time and from time to time on
or after June 15, 2046, the 2046 notes will be redeemable at the
Issuers option, in whole or in part, at a redemption price equal
to 50% of the principal amount of the 2046 notes to be redeemed,
plus accrued and unpaid interest thereon to, but excluding, the
redemption date. The Senior Notes are subject to certain
covenants, including limitations on the ability of the Company
and its subsidiaries, with exceptions, to incur liens on the
stock of certain subsidiaries, or dispose of capital stock of
certain subsidiaries.

The Senior Notes are subject to a special mandatory redemption (a
Special Mandatory Redemption) if (i) the Stock Purchase Agreement
(the Stock Purchase Agreement) between the Company and American
International Group, Inc. (AIG), previously disclosed by the
Company, is terminated on any date prior to August 31, 2017 or
(ii) the acquisition under the Stock Purchase Agreement is not
consummated prior to August 31, 2017 (the earlier of any such
date, a Trigger Date). In the event a Trigger Date occurs, the
Issuer will be required to redeem the Senior Notes at 101% of the
aggregate principal amount of the Senior Notes, together with
accrued and unpaid interest on the Senior Notes from the issue
date or the last date on which interest has been paid up to, but
not including, the applicable special mandatory redemption date.
In that event, the Issuer will cause a notice of Special
Mandatory Redemption to be sent, with a copy to the Trustee, not
later than five business days after the Trigger Date to each
holder of the Senior Notes at its registered address.

The special mandatory redemption date will be the tenth business
day following the Trigger Date. Notwithstanding the foregoing,
installments of interest on any series of notes that are due and
payable on interest payment dates falling on or before the
special mandatory redemption date will be payable on such
interest payment dates to the registered holders as of the close
of business on the relevant record dates in accordance with the
Senior Notes and the Indenture.

The information provided in Item 1.01 of this report is
incorporated by reference into this Item 2.03.

In connection with the offering of the Senior Notes, the Company
is filing the legal opinions relating to the offering as Exhibit
5.1 and 5.2 to this report.

See Exhibit Index.