-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, AZWzCrdT6TEtleij8GycwvTqM9iHYPEMRa8iYDP7tRJw0qW0jlRtEaDks3q6xPRf tXC8OiToLKY9FUFL0nem+A== 0000909567-04-001647.txt : 20041123 0000909567-04-001647.hdr.sgml : 20041123 20041123170817 ACCESSION NUMBER: 0000909567-04-001647 CONFORMED SUBMISSION TYPE: SC 13D/A PUBLIC DOCUMENT COUNT: 12 FILED AS OF DATE: 20041123 DATE AS OF CHANGE: 20041123 GROUP MEMBERS: 1109519 ONTARIO LIMITED GROUP MEMBERS: 810679 ONTARIO LIMITED GROUP MEMBERS: FAIRFAX FINANCIAL (US) LLC GROUP MEMBERS: FAIRFAX FINANCIAL HOLDINGS LIMITED GROUP MEMBERS: FAIRFAX INC. GROUP MEMBERS: FFHL GROUP LTD. GROUP MEMBERS: ORH HOLDINGS INC. GROUP MEMBERS: THE SIXTY TWO INVESTMENT COMPANY LIMITED GROUP MEMBERS: TIG HOLDINGS, INC. GROUP MEMBERS: TIG INSURANCE COMPANY GROUP MEMBERS: TIG INSURANCE GROUP INC. GROUP MEMBERS: UNITED STATES FIRE INSURANCE COMPANY GROUP MEMBERS: V. PREM WATSA SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: ODYSSEY RE HOLDINGS CORP CENTRAL INDEX KEY: 0001137048 STANDARD INDUSTRIAL CLASSIFICATION: FIRE, MARINE & CASUALTY INSURANCE [6331] IRS NUMBER: 522301683 STATE OF INCORPORATION: DE FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A SEC ACT: 1934 Act SEC FILE NUMBER: 005-61705 FILM NUMBER: 041164439 BUSINESS ADDRESS: STREET 1: 300 FIRST STAMFORD PL CITY: STAMFORD STATE: CT ZIP: 06902 BUSINESS PHONE: 2039778000 MAIL ADDRESS: STREET 1: 300 FIRST STAMFORD PL CITY: STAMFORD STATE: CT ZIP: 06902 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: FAIRFAX FINANCIAL HOLDINGS LTD/ CAN CENTRAL INDEX KEY: 0000915191 STANDARD INDUSTRIAL CLASSIFICATION: FIRE, MARINE & CASUALTY INSURANCE [6331] IRS NUMBER: 000000000 STATE OF INCORPORATION: A6 FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: SC 13D/A BUSINESS ADDRESS: STREET 1: 95 WELLINGTON ST WEST STREET 2: STE 800 CITY: TORONTO ONTARIO CANA STATE: A6 BUSINESS PHONE: 4163674941 MAIL ADDRESS: STREET 1: FAIRFAX FINANCIAL HOLDINGS LTD STREET 2: 95 WELLINGTON ST WEST STE 800 CITY: TORONTO ONTARIO CANA STATE: A6 FORMER COMPANY: FORMER CONFORMED NAME: FAIRFAX FINANCIAL HOLDINGS LTD DATE OF NAME CHANGE: 19931122 SC 13D/A 1 t14767sc13dza.txt SC 13D/A SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 AMENDMENT NO. 2 TO SCHEDULE 13D UNDER THE SECURITIES EXCHANGE ACT OF 1934 Odyssey Re Holdings Corp. ------------------------- (Name of Issuer) Common Stock, $.01 par value ------------------------------ (Title of Class of Securities) 67612W108 -------------- (CUSIP Number) Eric P. Salsberg Vice President, Corporate Affairs Fairfax Financial Holdings Limited 95 Wellington Street West, Suite 800 Toronto, Ontario, Canada, M5J 2N7 Telephone: (416) 367-4941 ------------------------- (Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications) - With a copy to - Brice T. Voran Shearman & Sterling LLP Commerce Court West 199 Bay Street, Suite 4405 Toronto, Ontario M5L 1E8 Telephone (416) 360-8484 November 19, 2004 ------------------ (Date of Event which Requires Filing of this Statement) If the filing person has previously filed a statement on Schedule 13G to report the acquisition which is the subject of this Schedule 13D, and is filing this schedule became of Rule 13d-1(b)(3) or (4), check the following box [ ]. The information required on the remainder of this cover page shall not be deemed to be "filed" for the purpose of Section 18 of the Securities Exchange Act of 1934 or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes). 13D CUSIP No. 67612W108 Page 2 of 39 Pages - -------------------------------------------------------------------------------- (1) Name of Reporting Person V. Prem Watsa - -------------------------------------------------------------------------------- (2) Check the Appropriate Box if a Member of a Group (a) [ ] (b) [X] - -------------------------------------------------------------------------------- (3) SEC Use Only - -------------------------------------------------------------------------------- (4) Source of Funds OO - -------------------------------------------------------------------------------- (5) Check box if Disclosure of Legal Proceedings is Required Pursuant to Item 2(d) or 2(e). [ ] - -------------------------------------------------------------------------------- (6) Citizenship or Place of Organization Canada - -------------------------------------------------------------------------------- (7) Sole Voting Power ------------------------------ Number of (8) Shared Voting Power Shares Beneficially 52,364,400 Owned by Each ------------------------------ Reporting (9) Sole Dispositive Power Person With ------------------------------ (10) Shared Dispositive Power 52,364,400 - -------------------------------------------------------------------------------- (11) Aggregate Amount Beneficially Owned by each Reporting Person 52,364,400 - -------------------------------------------------------------------------------- (12) Check Box if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions) [ ] - -------------------------------------------------------------------------------- (13) Percent of Class Represented by Amount in Row (11) 80.8 - -------------------------------------------------------------------------------- (14) Type of Reporting Person (See Instructions) IN - -------------------------------------------------------------------------------- 2 13D CUSIP No. 67612W108 Page 3 of 39 Pages - -------------------------------------------------------------------------------- (1) Name of Reporting Person 1109519 ONTARIO LIMITED - -------------------------------------------------------------------------------- (2) Check the Appropriate Box if a Member of a Group (a) [ ] (b) [X] - -------------------------------------------------------------------------------- (3) SEC Use Only - -------------------------------------------------------------------------------- (4) Source of Funds OO - -------------------------------------------------------------------------------- (5) Check box if Disclosure of Legal Proceedings is Required Pursuant to Item 2(d) or 2(e). [ ] - -------------------------------------------------------------------------------- (6) Citizenship or Place of Organization Ontario, Canada - -------------------------------------------------------------------------------- (7) Sole Voting Power ------------------------------ Number of (8) Shared Voting Power Shares Beneficially 52,364,400 Owned by Each ------------------------------ Reporting (9) Sole Dispositive Power Person With ------------------------------ (10) Shared Dispositive Power 52,364,400 - -------------------------------------------------------------------------------- (11) Aggregate Amount Beneficially Owned by each Reporting Person 52,364,400 - -------------------------------------------------------------------------------- (12) Check Box if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions) [ ] - -------------------------------------------------------------------------------- (13) Percent of Class Represented by Amount in Row (11) 80.8 - -------------------------------------------------------------------------------- (14) Type of Reporting Person (See Instructions) CO - -------------------------------------------------------------------------------- 3 13D CUSIP No. 67612W108 Page 4 of 39 Pages - -------------------------------------------------------------------------------- (1) Name of Reporting Person THE SIXTY TWO INVESTMENT COMPANY LIMITED - -------------------------------------------------------------------------------- (2) Check the Appropriate Box if a Member of a Group (a) [ ] (b) [X] - -------------------------------------------------------------------------------- (3) SEC Use Only - -------------------------------------------------------------------------------- (4) Source of Funds OO - -------------------------------------------------------------------------------- (5) Check box if Disclosure of Legal Proceedings is Required Pursuant to Item 2(d) or 2(e). [ ] - -------------------------------------------------------------------------------- (6) Citizenship or Place of Organization British Columbia - -------------------------------------------------------------------------------- (7) Sole Voting Power Number of ----------------------------- Shares Beneficially (8) Shared Voting Power Owned 52,364,400 by Each Reporting ----------------------------- Person With (9) Sole Dispositive Power ----------------------------- (10) Shared Dispositive Power 52,364,400 - -------------------------------------------------------------------------------- (11) Aggregate Amount Beneficially Owned by each Reporting Person 52,364,400 - -------------------------------------------------------------------------------- (12) Check Box if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions) [ ] - -------------------------------------------------------------------------------- (13) Percent of Class Represented by Amount in Row (11) 80.8 - -------------------------------------------------------------------------------- (14) Type of Reporting Person (See Instructions) CO - -------------------------------------------------------------------------------- 4 13D CUSIP No. 67612W108 Page 5 of 39 Pages - -------------------------------------------------------------------------------- (1) Name of Reporting Person 810679 ONTARIO LIMITED - -------------------------------------------------------------------------------- (2) Check the Appropriate Box if a Member of a Group (a) [ ] (b) [X] - -------------------------------------------------------------------------------- (3) SEC Use Only - -------------------------------------------------------------------------------- (4) Source of Funds OO - -------------------------------------------------------------------------------- (5) Check box if Disclosure of Legal Proceedings is Required Pursuant to Item 2(d) or 2(e). [ ] - -------------------------------------------------------------------------------- (6) Citizenship or Place of Organization Ontario, Canada - -------------------------------------------------------------------------------- (7) Sole Voting Power Number of ----------------------------- Shares Beneficially (8) Shared Voting Power Owned 52,364,400 by Each Reporting ----------------------------- Person With (9) Sole Dispositive Power ----------------------------- (10) Shared Dispositive Power 52,364,400 - -------------------------------------------------------------------------------- (11) Aggregate Amount Beneficially Owned by each Reporting Person 52,364,400 - -------------------------------------------------------------------------------- (12) Check Box if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions) [ ] - -------------------------------------------------------------------------------- (13) Percent of Class Represented by Amount in Row (11) 80.8 - -------------------------------------------------------------------------------- (14) Type of Reporting Person (See Instructions) CO - -------------------------------------------------------------------------------- 5 13D CUSIP No. 67612W108 Page 6 of 39 Pages - -------------------------------------------------------------------------------- (1) Name of Reporting Person FAIRFAX FINANCIAL HOLDINGS LIMITED - -------------------------------------------------------------------------------- (2) Check the Appropriate Box if a Member of a Group (a) [ ] (b) [X] - -------------------------------------------------------------------------------- (3) SEC Use Only - -------------------------------------------------------------------------------- (4) Source of Funds OO - -------------------------------------------------------------------------------- (5) Check box if Disclosure of Legal Proceedings is Required Pursuant to Item 2(d) or 2(e). [ ] - -------------------------------------------------------------------------------- (6) Citizenship or Place of Organization Canada - -------------------------------------------------------------------------------- (7) Sole Voting Power Number of ----------------------------- Shares Beneficially (8) Shared Voting Power Owned 52,364,400 by Each Reporting ----------------------------- Person With (9) Sole Dispositive Power ----------------------------- (10) Shared Dispositive Power 52,364,400 - -------------------------------------------------------------------------------- (11) Aggregate Amount Beneficially Owned by each Reporting Person 52,364,400 - -------------------------------------------------------------------------------- (12) Check Box if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions) [ ] - -------------------------------------------------------------------------------- (13) Percent of Class Represented by Amount in Row (11) 80.8 - -------------------------------------------------------------------------------- (14) Type of Reporting Person (See Instructions) CO - -------------------------------------------------------------------------------- 6 13D CUSIP No. 67612W108 Page 7 of 39 Pages - -------------------------------------------------------------------------------- (1) Name of Reporting Person FFHL GROUP LTD. - -------------------------------------------------------------------------------- (2) Check the Appropriate Box if a Member of a Group (a) [ ] (b) [X] - -------------------------------------------------------------------------------- (3) SEC Use Only - -------------------------------------------------------------------------------- (4) Source of Funds OO - -------------------------------------------------------------------------------- (5) Check box if Disclosure of Legal Proceedings is Required Pursuant to Item 2(d) or 2(e). [ ] - -------------------------------------------------------------------------------- (6) Citizenship or Place of Organization Canada - -------------------------------------------------------------------------------- (7) Sole Voting Power Number of ----------------------------- Shares Beneficially (8) Shared Voting Power Owned 52,364,400 by Each Reporting ----------------------------- Person With (9) Sole Dispositive Power ----------------------------- (10) Shared Dispositive Power 52,364,400 - -------------------------------------------------------------------------------- (11) Aggregate Amount Beneficially Owned by each Reporting Person 52,364,400 - -------------------------------------------------------------------------------- (12) Check Box if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions) [ ] - -------------------------------------------------------------------------------- (13) Percent of Class Represented by Amount in Row (11) 80.8 - -------------------------------------------------------------------------------- (14) Type of Reporting Person (See Instructions) CO - -------------------------------------------------------------------------------- 7 13D CUSIP No. 67612W108 Page 8 of 39 Pages - -------------------------------------------------------------------------------- (1) Name of Reporting Person FAIRFAX INC. - -------------------------------------------------------------------------------- (2) Check the Appropriate Box if a Member of a Group (a) [ ] (b) [X] - -------------------------------------------------------------------------------- (3) SEC Use Only - -------------------------------------------------------------------------------- (4) Source of Funds OO - -------------------------------------------------------------------------------- (5) Check box if Disclosure of Legal Proceedings is Required Pursuant to Item 2(d) or 2(e). [ ] - -------------------------------------------------------------------------------- (6) Citizenship or Place of Organization Wyoming - -------------------------------------------------------------------------------- (7) Sole Voting Power Number of ----------------------------- Shares Beneficially (8) Shared Voting Power Owned 52,364,400 by Each Reporting ----------------------------- Person With (9) Sole Dispositive Power ----------------------------- (10) Shared Dispositive Power 52,364,400 - -------------------------------------------------------------------------------- (11) Aggregate Amount Beneficially Owned by each Reporting Person 52,364,400 - -------------------------------------------------------------------------------- (12) Check Box if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions) [ ] - -------------------------------------------------------------------------------- (13) Percent of Class Represented by Amount in Row (11) 80.8 - -------------------------------------------------------------------------------- (14) Type of Reporting Person (See Instructions) CO - -------------------------------------------------------------------------------- 8 13D CUSIP No. 67612W108 Page 9 of 39 Pages - -------------------------------------------------------------------------------- (1) Name of Reporting Person FAIRFAX FINANCIAL (US) LLC - -------------------------------------------------------------------------------- (2) Check the Appropriate Box if a Member of a Group (a) [ ] (b) [X] - -------------------------------------------------------------------------------- (3) SEC Use Only - -------------------------------------------------------------------------------- (4) Source of Funds OO - -------------------------------------------------------------------------------- (5) Check box if Disclosure of Legal Proceedings is Required Pursuant to Item 2(d) or 2(e). [ ] - -------------------------------------------------------------------------------- (6) Citizenship or Place of Organization Delaware - -------------------------------------------------------------------------------- (7) Sole Voting Power Number of ----------------------------- Shares Beneficially (8) Shared Voting Power Owned 4,300,000 by Each Reporting ----------------------------- Person With (9) Sole Dispositive Power ----------------------------- (10) Shared Dispositive Power 4,300,000 - -------------------------------------------------------------------------------- (11) Aggregate Amount Beneficially Owned by each Reporting Person 4,300,000 - -------------------------------------------------------------------------------- (12) Check Box if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions) [ ] - -------------------------------------------------------------------------------- (13) Percent of Class Represented by Amount in Row (11) 6.6 - -------------------------------------------------------------------------------- (14) Type of Reporting Person (See Instructions) CO - -------------------------------------------------------------------------------- 9 13D CUSIP No. 67612W108 Page 10 of 39 Pages - -------------------------------------------------------------------------------- (1) Name of Reporting Person TIG HOLDINGS, INC. - -------------------------------------------------------------------------------- (2) Check the Appropriate Box if a Member of a Group (a) [ ] (b) [X] - -------------------------------------------------------------------------------- (3) SEC Use Only - -------------------------------------------------------------------------------- (4) Source of Funds OO - -------------------------------------------------------------------------------- (5) Check box if Disclosure of Legal Proceedings is Required Pursuant to Item 2(d) or 2(e). [ ] - -------------------------------------------------------------------------------- (6) Citizenship or Place of Organization Delaware - -------------------------------------------------------------------------------- (7) Sole Voting Power Number of ----------------------------- Shares Beneficially (8) Shared Voting Power Owned 47,200,000 by Each Reporting ----------------------------- Person With (9) Sole Dispositive Power ----------------------------- (10) Shared Dispositive Power 47,200,000 - -------------------------------------------------------------------------------- (11) Aggregate Amount Beneficially Owned by each Reporting Person 47,200,000 - -------------------------------------------------------------------------------- (12) Check Box if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions) [ ] - -------------------------------------------------------------------------------- (13) Percent of Class Represented by Amount in Row (11) 72.9 - -------------------------------------------------------------------------------- (14) Type of Reporting Person (See Instructions) CO - -------------------------------------------------------------------------------- 10 13D CUSIP No. 67612W108 Page 11 of 39 Pages - -------------------------------------------------------------------------------- (1) Name of Reporting Person TIG INSURANCE GROUP INC. - -------------------------------------------------------------------------------- (2) Check the Appropriate Box if a Member of a Group (a) [ ] (b) [X] - -------------------------------------------------------------------------------- (3) SEC Use Only - -------------------------------------------------------------------------------- (4) Source of Funds OO - -------------------------------------------------------------------------------- (5) Check box if Disclosure of Legal Proceedings is Required Pursuant to Item 2(d) or 2(e). [ ] - -------------------------------------------------------------------------------- (6) Citizenship or Place of Organization California - -------------------------------------------------------------------------------- (7) Sole Voting Power Number of ----------------------------- Shares Beneficially (8) Shared Voting Power Owned 47,200,000 by Each Reporting ----------------------------- Person With (9) Sole Dispositive Power ----------------------------- (10) Shared Dispositive Power 47,200,000 - -------------------------------------------------------------------------------- (11) Aggregate Amount Beneficially Owned by each Reporting Person 47,200,000 - -------------------------------------------------------------------------------- (12) Check Box if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions) [ ] - -------------------------------------------------------------------------------- (13) Percent of Class Represented by Amount in Row (11) 72.9 - -------------------------------------------------------------------------------- (14) Type of Reporting Person (See Instructions) CO - -------------------------------------------------------------------------------- 11 13D CUSIP No. 67612W108 Page 12 of 39 Pages - -------------------------------------------------------------------------------- (1) Name of Reporting Person TIG INSURANCE COMPANY - -------------------------------------------------------------------------------- (2) Check the Appropriate Box if a Member of a Group (a) [ ] (b) [X] - -------------------------------------------------------------------------------- (3) SEC Use Only - -------------------------------------------------------------------------------- (4) Source of Funds OO - -------------------------------------------------------------------------------- (5) Check box if Disclosure of Legal Proceedings is Required Pursuant to Item 2(d) or 2(e). [ ] - -------------------------------------------------------------------------------- (6) Citizenship or Place of Organization California - -------------------------------------------------------------------------------- (7) Sole Voting Power Number of ----------------------------- Shares Beneficially (8) Shared Voting Power Owned 12,660,966 by Each Reporting ----------------------------- Person With (9) Sole Dispositive Power ----------------------------- (10) Shared Dispositive Power 12,660,966 - -------------------------------------------------------------------------------- (11) Aggregate Amount Beneficially Owned by each Reporting Person 12,660,966 - -------------------------------------------------------------------------------- (12) Check Box if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions) [ ] - -------------------------------------------------------------------------------- (13) Percent of Class Represented by Amount in Row (11) 19.5 - -------------------------------------------------------------------------------- (14) Type of Reporting Person (See Instructions) CO - -------------------------------------------------------------------------------- 12 13D CUSIP No. 67612W108 Page 13 of 39 Pages - -------------------------------------------------------------------------------- (1) Name of Reporting Person ORH HOLDINGS INC. - -------------------------------------------------------------------------------- (2) Check the Appropriate Box if a Member of a Group (a) [ ] (b) [X] - -------------------------------------------------------------------------------- (3) SEC Use Only - -------------------------------------------------------------------------------- (4) Source of Funds OO - -------------------------------------------------------------------------------- (5) Check box if Disclosure of Legal Proceedings is Required Pursuant to Item 2(d) or 2(e). [ ] - -------------------------------------------------------------------------------- (6) Citizenship or Place of Organization Delaware - -------------------------------------------------------------------------------- (7) Sole Voting Power Number of ----------------------------- Shares Beneficially (8) Shared Voting Power Owned 6,166,667 by Each Reporting ----------------------------- Person With (9) Sole Dispositive Power ----------------------------- (10) Shared Dispositive Power 6,166,667 - -------------------------------------------------------------------------------- (11) Aggregate Amount Beneficially Owned by each Reporting Person 6,166,667 - -------------------------------------------------------------------------------- (12) Check Box if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions) [ ] - -------------------------------------------------------------------------------- (13) Percent of Class Represented by Amount in Row (11) 9.5 - -------------------------------------------------------------------------------- (14) Type of Reporting Person (See Instructions) CO - -------------------------------------------------------------------------------- 13 13D CUSIP No. 67612W108 Page 14 of 39 Pages - -------------------------------------------------------------------------------- (1) Name of Reporting Person UNITED STATES FIRE INSURANCE COMPANY - -------------------------------------------------------------------------------- (2) Check the Appropriate Box if a Member of a Group (a) [ ] (b) [X] - -------------------------------------------------------------------------------- (3) SEC Use Only - -------------------------------------------------------------------------------- (4) Source of Funds OO - -------------------------------------------------------------------------------- (5) Check box if Disclosure of Legal Proceedings is Required Pursuant to Item 2(d) or 2(e). [ ] - -------------------------------------------------------------------------------- (6) Citizenship or Place of Organization Delaware - -------------------------------------------------------------------------------- (7) Sole Voting Power Number of ----------------------------- Shares Beneficially (8) Shared Voting Power Owned 800,000 by Each Reporting ----------------------------- Person With (9) Sole Dispositive Power ----------------------------- (10) Shared Dispositive Power 800,000 - -------------------------------------------------------------------------------- (11) Aggregate Amount Beneficially Owned by each Reporting Person 800,000 - -------------------------------------------------------------------------------- (12) Check Box if the Aggregate Amount in Row (11) Excludes Certain Shares (See Instructions) [ ] - -------------------------------------------------------------------------------- (13) Percent of Class Represented by Amount in Row (11) 1.2 - -------------------------------------------------------------------------------- (14) Type of Reporting Person (See Instructions) CO - -------------------------------------------------------------------------------- 14 This Amendment No. 2 amends the Statement on Schedule 13D filed with the Securities and Exchange Commission on June 27, 2001 by V. Prem Watsa, The Sixty Two Investment Company Limited, Fairfax Financial Holdings Limited ("Fairfax"), Odyssey Re Holdings Ltd., Odyssey Re Group Ltd., Fairfax Inc., TIG Holdings, Inc., TIG Insurance Group, TIG Insurance Company, and ORH Holdings Inc., as amended by Amendment No. 1 thereto filed on March 7, 2003 (such schedule, as amended, the "Schedule 13D") in relation to shares of common stock, par value $0.01 per share, of Odyssey Re Holdings Corp. ("Shares"). Amendment No. 1 to the Schedule 13D related to the purchase by Fairfax, through a subsidiary, pursuant to a master note purchase agreement, dated as of March 3, 2003, of 4,300,000 outstanding Shares (the "2003 Purchased Shares") in a private transaction. As consideration for the Purchased Shares, a subsidiary of Fairfax issued $78,045,000 aggregate principal amount of 3.15% Exchangeable Notes due February 28, 2010 (the "Old Exchangeable Notes"), exchangeable into 4,300,000 Shares. This Amendment No. 2 to the Schedule 13D relates to the purchase (the "Purchase") by a subsidiary of Fairfax of its $78,045,000 aggregate principal amount of Old Exchangeable Notes in a private transaction. As consideration, the subsidiary issued $100,964,000 aggregate principal amount of new 3.15% Exchangeable Notes due November 19, 2009 (the "New Exchangeable Notes"). The New Exchangeable Notes are exchangeable into 4,300,000 Shares. The Old Exchangeable Notes have been cancelled. The following amendments to Items 2, 3, 4, 5, 6 and 7 of the Schedule 13D are hereby made. ITEM 2. IDENTITY AND BACKGROUND Item 2 of the Schedule 13D is hereby amended in its entirety to read as follows: "This statement is being jointly filed by the following persons (collectively, the "Reporting Persons"): 1. V. Prem Watsa, an individual, is a citizen of Canada. Mr. Watsa's business address is 95 Wellington Street West, Suite 800, Toronto, Ontario, M5J 2N7; 2. 1109519 Ontario Limited ("1109519"), a corporation incorporated under the laws of Ontario, is controlled by V. Prem Watsa. The principal business of 1109519 is as an investment holding company. The principal business address and principal office address of 1109519 is 95 Wellington Street West, Suite 800, Toronto, Ontario, M5J 2N7; 3. The Sixty Two Investment Company Limited ("Sixty Two"), a corporation incorporated under the laws of British Columbia, is controlled by V. Prem Watsa. The principal business of Sixty Two is as an investment holding company. The principal business address and 15 principal office address of Sixty Two is 1600 Cathedral Place, 925 West Georgia St., Vancouver, British Columbia, Canada, V6C 3L3; 4. 810679 Ontario Limited ("810679"), a corporation incorporated under the laws of Ontario, is controlled by V. Prem Watsa. The principal business of 810679 is as an investment holding company. The principal business address and principal office address of 810679 is 95 Wellington Street West, Suite 800, Toronto, Ontario, Canada, M5J 2N7; 5. Fairfax, a corporation incorporated under the laws of Canada, is controlled by Sixty Two, 1109519 and V. Prem Watsa. Fairfax is a financial services holding company. The principal business and principal office address of Fairfax is 95 Wellington Street West, Suite 800, Toronto, Ontario, Canada, M5J 2N7; 6. FFHL Group Ltd., a corporation incorporated under the laws of Canada, is a wholly-owned subsidiary of Fairfax. The principal business of FFHL Group Ltd. is as a holding company. The principal business address and principal office address of FFHL Group Ltd. is 95 Wellington Street West, Suite 800, Toronto, Ontario, Canada, M5J 2N7; 7. Fairfax Inc., a corporation incorporated under the laws of Wyoming, is a wholly-owned subsidiary of Fairfax. The principal business of Fairfax Inc. is as a holding company. The principal business address and principal office address of Fairfax Inc. is 300 First Stamford Place, Stamford, CT 06902; 8. Fairfax Financial (US) LLC ("Fairfax LLC"), a Delaware limited liability company, is a wholly-owned subsidiary of Fairfax. The sole member of Fairfax LLC is Fairfax Inc. The principal business of Fairfax LLC is as a holding company. The principal business address and principal office address of Fairfax LLC is 5205 North O'Connor Blvd., Irving, Texas 75039; 9. TIG Holdings, Inc., a corporation incorporated under the laws of Delaware, is a wholly-owned subsidiary of Fairfax. The principal business of TIG Holdings, Inc. is as a holding company. The principal business address and principal office address of TIG Holdings, Inc. is 5205 North O'Connor Blvd., Irving, Texas 75039; 10. TIG Insurance Group Inc., a corporation incorporated under the laws of California, is a majority-owned subsidiary of Fairfax. The principal business of TIG Insurance Group is as a holding company. The principal business address and principal office address of TIG Insurance Group is 5205 North O'Connor Blvd., Irving, Texas 75039; 16 11. TIG Insurance Company ("TIG"), a corporation incorporated under the laws of California, is a majority-owned subsidiary of Fairfax. The principal business of TIG is property/casualty insurance. The principal business address and principal office address of TIG is 5205 North O'Connor Blvd., Irving, Texas 75039; 12. ORH Holdings Inc. ("ORH"), a corporation incorporated under the laws of Delaware, is a majority-owned subsidiary of Fairfax. The principal business of ORH is as a holding company. The principal business address and principal office address of ORH is 300 First Stamford Place, Stamford, Connecticut 06902; and 13. United States Fire Insurance Company ("US Fire"), a corporation incorporated under the laws of Delaware, is a wholly-owned subsidiary of Fairfax. The principal business of US Fire is insurance. The principal business address and principal office address of US Fire is 305 Madison Avenue, P.O. Box 1943, Morristown, New Jersey 07962. Neither the filing of this Schedule 13D nor the information contained herein shall be deemed to constitute an affirmation by V. Prem Watsa, 1109519, Sixty Two, 810679, Fairfax, FFHL Group Ltd., Fairfax Inc., Fairfax LLC, TIG Holdings, Inc., TIG Insurance Group, TIG, ORH or US Fire that such person is the beneficial owner of the Shares referred to herein for purposes of Section 13(d) or 13(g) of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), or for any other purpose, and such beneficial ownership is expressly disclaimed. The name, present principal occupation or employment and name, principal business and address of any corporation or other organization in which such employment is conducted and the citizenship of each executive officer and director, or each member of the board of managers, as applicable, of each of the Reporting Persons is set forth in Annex A, B, C, D, E, F, G, H, I, J, K or L, as the case may be, and such Annexes are incorporated herein by reference. Pursuant to Rule 13d-1(k) under the Exchange Act, the Reporting Persons have agreed to file jointly one statement with respect to their ownership of the Shares. During the last five years, none of the Reporting Persons, and, to the best of each such Reporting Person's knowledge, none of the persons listed in Annex A, B, C, D, E, F, G, H, I, J, K or L have been (a) convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors) or (b) a party to a civil proceeding of a judicial or administrative body of competent jurisdiction and as a result of such proceeding was or is subject to a judgment, decree or final order enjoining future violations of, or prohibiting or mandating activities subject to, federal or state securities laws or finding any violation with respect to such laws." ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION Item 3 of the Schedule 13D is hereby amended in its entirety to read as follows: 17 "On November 19, 2004, Fairfax LLC purchased its $78,045,000 aggregate principal amount of Old Exchangeable Notes, in a private transaction, from NMS Services (Cayman) Inc. (the "Purchaser"), an affiliate of Bank of America, N.A., as purchaser under the Master Note Purchase Agreement (as defined below). As consideration for the Old Exchangeable Notes, Fairfax LLC issued $100,964,000 aggregate principal amount of New Exchangeable Notes. In addition, in connection with the purchase of the Old Exchangeable Notes, Fairfax has agreed to reimburse the Purchaser for certain costs." ITEM 4. PURPOSE OF TRANSACTION Item 4 of the Schedule 13D is hereby amended in its entirety to read as follows: "The 2003 Purchased Shares were acquired and the Purchase was made by Fairfax for investment purposes and in order for Odyssey Re Holdings Corp. ("OdysseyRe") to be included in Fairfax's U.S. consolidated tax group so as to more quickly use Fairfax's future income tax asset and to allow for the cash flow benefit of receiving tax sharing payments from OdysseyRe. The Reporting Persons have the following plans and proposals: (a) The Reporting Persons currently do not intend to acquire or dispose of Shares, but may formulate plans to do so in the future. The Reporting Persons intend to review, on a continuous basis, various factors related to their direct or indirect investment, as the case may be, in OdysseyRe, including the price and availability of the Shares, subsequent developments affecting OdysseyRe's business, other investment and business opportunities available to the Reporting Persons and general stock market and economic conditions. Based upon these and other factors, the Reporting Persons may decide to purchase additional Shares or may decide in the future to sell all or part of their investment in OdysseyRe; (b) The Reporting Persons have no plans or proposals to cause OdysseyRe to enter into any extraordinary corporate transaction, such as a merger, reorganization or liquidation of OdysseyRe or any of its subsidiaries; (c) The Reporting Persons have no plans or proposals to cause OdysseyRe or any of its subsidiaries to sell or transfer a material amount of assets; (d) The Reporting Persons have no plans or proposals which would result in a change in the present board of directors or management of OdysseyRe, whether through a change in the number or term of directors or otherwise; (e) The Reporting Persons have no plans to make any material change in the present capitalization or dividend policy of OdysseyRe; (f) The Reporting Persons have no plans or proposals to cause OdysseyRe to make any other material change in its business or corporate structure; 18 (g) The Reporting Persons have no plans or proposals to cause OdysseyRe to change its certificate of incorporation or bylaws or to take other actions which may impede the acquisition of control of OdysseyRe by any person; (h) The Reporting Persons have no plans or proposals to cause the Shares to be delisted from any securities exchange or cease to be authorized to be quoted in an inter-dealer quotation system; (i) The Reporting Persons have no plans or proposals to cause the Shares to become eligible for termination of registration pursuant to Section 12(g) of the Exchange Act; and (j) The Reporting Persons have no plans or proposals to take any actions similar to those enumerated above." ITEM 5. INTEREST IN SECURITIES OF THE ISSUER Item 5 of the Schedule 13D is hereby amended in its entirety to read as follows: "(a) Based on the most recent information available, the aggregate number and percentage of the Shares (the securities identified pursuant to Item 1 of this Schedule 13D) that are beneficially owned by each of the Reporting Persons is set forth in boxes 11 and 13 of the second part of the cover page to this Schedule 13D for each of the Reporting Persons, and such information is incorporated herein by reference. (b) The number of Shares as to which each of the Reporting Persons has sole voting power, shared voting power, sole dispositive power and shared dispositive power is set forth in boxes 7, 8, 9 and 10, respectively, on the second part of the cover page to this Schedule 13D for each of the Reporting Persons, and such information is incorporated herein by reference. (c) Except as described herein, none of the Reporting Persons, nor, to the best knowledge of the Reporting Persons, any person listed in Annex A, B, C, D, E, F, G, H, I, J, K or L beneficially owns, or during the last 60 days has acquired or disposed of, any Shares. To the best knowledge of the Reporting Persons, the following persons beneficially own the following amounts of Shares and have sole voting power and sole dispositive power with respect to such Shares, except that Mr. Griffiths shares voting and dispositive power over 5,000 of such Shares with Fourfourtwo Investments Limited, a company controlled by Mr. Griffiths (in each case the amount of Shares accounts for less than 1% of the total outstanding amount of Shares): James F. Dowd 7,500 Andrew A. Barnard: 264,052 Anthony Griffiths: 7,500 Robbert Hartog 2,500 Brandon W. Sweitzer 3,500 Frank B. Bennett 1,550 19 (d) No person is known to have the right to receive or the power to direct the receipt of dividends from, or the proceeds from the sale of, Shares held by the Reporting Persons other than each of the Reporting Persons. (e) Not applicable." ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT TO SECURITIES OF THE ISSUER Item 6 of the Schedule 13D is hereby amended in its entirety to read as follows: "Except as described herein, none of the Reporting Persons, nor to the best knowledge of each of the Reporting Persons, any person listed in Annex A, B, C, D, E, F, G, H, I, J, K or L has any contract, arrangement, understanding or relationship (legal or otherwise) with any person with respect to any securities of OdysseyRe, including, but not limited to, transfer or voting of any of the securities, finder's fees, joint ventures, loan or option arrangements, puts or calls, guarantees of profits, division of profits or loss, or the giving or withholding of proxies other than as described below. Pursuant to a master note purchase agreement among Fairfax LLC, the Purchaser, Fairfax, as guarantor, and Banc of America Securities LLC, as agent, dated as of November 19, 2004 (the "Master Note Purchase Agreement"), in consideration for the Old Exchangeable Notes, Fairfax LLC issued (1) $68,092,000 aggregate principal amount of New Exchangeable Notes that are exchangeable into 2,900,000 Shares at the option of the Purchaser during the period beginning on and including November 3, 2006 through and including November 17, 2006, such date the "Exchange Period End Date" for such Exchangeable Notes and (2) $32,872,000 aggregate principal amount of New Exchangeable Notes that are exchangeable into 1,400,000 Shares at the option of the Purchaser during the period beginning on and including August 4, 2006 through and including August 18, 2006, such date the "Exchange Period End Date" for such Exchangeable Notes. The Old Exchangeable Notes have been cancelled. In addition, under the Master Note Purchase Agreement, the New Exchangeable Notes are exchangeable at the option of the Purchaser if at any time prior to the applicable Exchange Period End Date (a) OdysseyRe shall declare either (i) a dividend on the Shares to be paid in property other than cash or Shares or (ii) a quarterly cash dividend in excess of $0.03125 per Share, or (b) Fairfax LLC fails to reimburse the Purchaser for certain costs. The performance of Fairfax LLC's obligations under the New Exchangeable Notes has been guaranteed by Fairfax and, pursuant to a pledge agreement among Fairfax LLC, the Purchaser, and Banc of America Securities LLC, as agent, dated as of November 19, 2004 (the "Pledge Agreement"), secured by a pledge of the 2003 Purchased Shares in favor of the Purchaser. Immediately following the Purchase, the Purchaser transferred the New Exchangeable Notes to Intrepid Portfolios LLC ("Intrepid"), an affiliate of Bank of America, N.A. In addition, the Purchaser transferred its rights and obligations, and Intrepid assumed the Purchaser's rights and obligations, under the Master Note Purchase Agreement and the Pledge Agreement. 20 OdysseyRe has entered into a registration rights agreement with TIG and ORH. The registration rights agreement includes rights to require OdysseyRe to register the offer and sale of Shares held by TIG and ORH on up to three different occasions. Each of TIG and ORH may also require OdysseyRe to file registration statements on Form S-3. The registration rights agreement also includes the right to require OdysseyRe to include OdysseyRe common stock held by TIG and ORH in up to three future registration statements that OdysseyRe files with the Securities and Exchange Commission. Under the agreement, OdysseyRe also provides TIG and ORH with the right to participate in any securities offerings by OdysseyRe in order to maintain their percentage ownership. These rights are subject to various conditions and limitations. Under the registration rights agreement, OdysseyRe will bear all expenses incurred in connection with the registrations, other than any underwriting discounts and commissions. Registration of Shares upon the exercise of these registration rights would result in such Shares becoming freely tradable without restriction under the Securities Act. Messrs. Andrew A. Barnard, James F. Dowd, Frank B. Bennett, Robbert Hartog, Anthony Griffiths and Brandon W. Sweitzer have been granted stock options to purchase Shares in the amount of 40,000, 15,000, 5,000, 5,000, 5,000, and 5,000, respectively, under the OdysseyRe 2002 Stock Incentive Plan that have not been exercised." ITEM 7. MATERIAL TO BE FILED AS EXHIBITS Item 7 of the Schedule 13D is hereby amended by the addition of the following exhibits to the end thereof: 2.1 Master Note Purchase Agreement dated as of November 19, 2004. 2.2 Promissory Note ("Note 1") in the amount of $68,092,000 due November 19, 2009 exchangeable into 2,900,000 Shares. 2.3 Promissory Note ("Note 2") in the amount of $11,740,000 due November 19, 2009 exchangeable into 500,000 Shares. 2.4 Promissory Note ("Note 3") in the amount of $11,740,000 due November 19, 2009 exchangeable into 500,000 Shares. 2.5 Promissory Note ("Note 4") in the amount of $9,392,000 due November 19, 2009 exchangeable into 400,000 Shares. 2.6 Note Purchase Confirmation No. 1 relating to Note 1. 2.7 Note Purchase Confirmation No. 2 relating to Note 2. 2.8 Note Purchase Confirmation No. 3 relating to Note 3. 21 2.9 Note Purchase Confirmation No. 4 relating to Note 4. 2.10 Pledge Agreement dated as of November 19, 2004. 2.11 Joint filing agreement dated as of November 23, 2004 between V. Prem Watsa, 1109519 Ontario Limited, The Sixty Two Investment Company Limited, 810679 Ontario Limited, Fairfax Financial Holdings Limited, FFHL Group Limited, Fairfax Inc., Fairfax Financial (US) LLC, TIG Holdings, Inc., TIG Insurance Group, TIG Insurance Company, ORH Holdings Inc., and United States Fire Insurance Company. 22 SIGNATURES After reasonable inquiry and to the best knowledge and belief of the undersigned, such person certifies that the information set forth in this statement with respect to such person is true, complete and correct. IN WITNESS WHEREOF, the undersigned has executed this instrument as of the 23rd day of November, 2004. V. PREM WATSA /s/ V. Prem Watsa -------------------------------------------- 1109519 ONTARIO LIMITED By: /s/ V. Prem Watsa ---------------------------------------- Name: V. Prem Watsa Title: President THE SIXTY TWO INVESTMENT COMPANY LIMITED By: /s/ V. Prem Watsa ---------------------------------------- Name: V. Prem Watsa Title: President 810679 ONTARIO LIMITED By: /s/ V. Prem Watsa ---------------------------------------- Name: V. Prem Watsa Title: President FAIRFAX FINANCIAL HOLDINGS LIMITED By: /s/ Eric P. Salsberg ---------------------------------------- Name: Eric P. Salsberg Title: Vice President, Corporate Affairs FFHL GROUP LTD. By: /s/ Eric P. Salsberg ---------------------------------------- Name: Eric P. Salsberg Title: Vice President FAIRFAX INC. By: /s/ Eric P. Salsberg ---------------------------------------- Name: Eric P. Salsberg Title: Vice President FAIRFAX FINANCIAL (US) LLC. By: /s/ Bradley P. Martin ---------------------------------------- Name: Bradley P. Martin Title: Vice President TIG HOLDINGS, INC. By: /s/ R. Scott Donovan ---------------------------------------- Name: R. Scott Donovan Title: President TIG INSURANCE GROUP By: /s/ R. Scott Donovan ------------------------------------------ Name: R. Scott Donovan Title: President TIG INSURANCE COMPANY By: /s/ R. Scott Donovan ------------------------------------------ Name: R. Scott Donovan Title: President ORH HOLDINGS INC. By: /s/ Eric P. Salsberg ------------------------------------------ Name: Eric P. Salsberg Title: Vice President UNITED STATES FIRE INSURANCE COMPANY By: /s/ Mary Jane Robertson ------------------------------------------ Name: Mary Jane Robertson Title: Senior Executive Vice President, Chief Financial Officer & Treasurer ANNEX INDEX
ANNEX DESCRIPTION - ----- ----------- A Directors and Executive Officers of 1109519 Ontario Limited B Directors and Executive Officers of The Sixty Two Investment Company Limited C Directors and Executive Officers of 810679 Ontario Limited D Directors and Executive Officers of Fairfax Financial Holdings Limited E Directors and Executive Officers of FFHL Group Ltd. F Directors and Executive Officers of Fairfax Inc. G Members of the Board of Managers and Executive Officers of Fairfax Financial (US) LLC H Directors and Executive Officers of TIG Holdings, Inc. I Directors and Executive Officers of TIG Insurance Group J Directors and Executive Officers of TIG Insurance Company K Directors and Executive Officers of ORH Holdings Inc. L Directors and Executive Officers of United States Fire Insurance Company
26 ANNEX A DIRECTORS AND EXECUTIVE OFFICERS OF 1109519 ONTARIO LIMITED The following table sets forth certain information with respect to the directors and executive officers of 1109519 Ontario Limited.
PRESENT PRINCIPAL OCCUPATION OR EMPLOYMENT AND THE NAME, PRINCIPAL BUSINESS AND ADDRESS OF ANY CORPORATION OR OTHER ORGANIZATION IN NAME WHICH SUCH EMPLOYMENT IS CONDUCTED CITIZENSHIP ---- ------------------------------------------- ----------- V. Prem Watsa Chairman and Chief Executive Officer, Canadian (President and Director) Fairfax Financial Holdings Limited 95 Wellington Street West Suite 800 Toronto, Ontario M5J 2N7 Eric P. Salsberg Vice President, Corporate Affairs, Fairfax Canadian (Assistant Secretary and Director) Financial Holdings Limited
27 ANNEX B DIRECTORS AND EXECUTIVE OFFICERS OF THE SIXTY TWO INVESTMENT COMPANY LIMITED The following table sets forth certain information with respect to the directors and executive officers of The Sixty Two Investment Company Limited.
PRESENT PRINCIPAL OCCUPATION OR EMPLOYMENT AND THE NAME, PRINCIPAL BUSINESS AND ADDRESS OF ANY CORPORATION OR OTHER ORGANIZATION IN NAME WHICH SUCH EMPLOYMENT IS CONDUCTED CITIZENSHIP ---- ------------------------------------------- ----------- V. Prem Watsa Chairman and Chief Executive Officer, Canadian (President and Director) Fairfax Financial Holdings Limited 95 Wellington Street West Suite 800 Toronto, Ontario M5J 2N7 Eric P. Salsberg Vice President, Corporate Affairs, Fairfax Canadian (Assistant Secretary and Director) Financial Holdings Limited
28 ANNEX C DIRECTORS AND EXECUTIVE OFFICERS OF 810679 ONTARIO LIMITED The following table sets forth certain information with respect to the directors and executive officers of 810679 Ontario Limited.
PRESENT PRINCIPAL OCCUPATION OR EMPLOYMENT AND THE NAME, PRINCIPAL BUSINESS AND ADDRESS OF ANY CORPORATION OR OTHER ORGANIZATION IN NAME WHICH SUCH EMPLOYMENT IS CONDUCTED CITIZENSHIP ---- ------------------------------------------- ----------- V. Prem Watsa Chairman and Chief Executive Officer, Canadian (President and Director) Fairfax Financial Holdings Limited 95 Wellington Street West Suite 800 Toronto, Ontario M5J 2N7 Eric P. Salsberg Vice President, Corporate Affairs, Fairfax Canadian (Assistant Secretary and Director) Financial Holdings Limited
29 ANNEX D DIRECTORS AND EXECUTIVE OFFICERS OF FAIRFAX FINANCIAL HOLDINGS LIMITED The following table sets forth certain information with respect to the directors and executive officers of Fairfax Financial Holdings Limited.
PRESENT PRINCIPAL OCCUPATION OR EMPLOYMENT AND THE NAME, PRINCIPAL BUSINESS AND ADDRESS OF ANY CORPORATION OR OTHER ORGANIZATION IN WHICH SUCH NAME EMPLOYMENT IS CONDUCTED CITIZENSHIP ---- --------------------------------------- ------------- V. Prem Watsa Chairman and Chief Executive Officer, Fairfax Financial Holdings Canadian (Chairman and Chief Executive Officer) Limited 95 Wellington Street West Suite 800 Toronto, Ontario M5J 2N7 Frank B. Bennett President, Artesian Management Inc. United States (Director) 301 Carlson Parkway, Suite 120 Minnetonka, MN 55305 Robbert Hartog President, Robhar Investments Ltd. Canadian (Director) R.R. #1 Perkinsfield, Ontario L0L 2J0 Anthony Griffiths Independent Business Consultant Canadian (Director) Toronto, Ontario, Canada Brandon W. Sweitzer Senior Advisor to the President of the United States (Director) Chamber of Commerce of The United States 1615 H Street, NW Washington, DC 20062 Trevor J. Ambridge Vice President and Chief Canadian (Vice President and Chief Financial Financial Officer, Fairfax Officer) Financial Holdings Limited Eric P. Salsberg Vice President, Corporate Affairs, Canadian (Vice President, Corporate Affairs) Fairfax Financial Holdings Limited
30 ANNEX E DIRECTORS AND EXECUTIVE OFFICERS OF FFHL GROUP LTD. The following table sets forth certain information with respect to the directors and executive officers of FFHL Group Ltd.
PRESENT PRINCIPAL OCCUPATION OR EMPLOYMENT AND THE NAME, PRINCIPAL BUSINESS AND ADDRESS OF ANY CORPORATION OR OTHER ORGANIZATION IN WHICH SUCH NAME EMPLOYMENT IS CONDUCTED CITIZENSHIP ---- --------------------------------------- ------------- James F. Dowd President and Chief Executive Officer, United States (Chairman) Fairfax Inc. 305 Madison Avenue Morristown, NJ 07960 Eric P. Salsberg Vice President, Corporate Affairs, Canadian (Vice President and Director) Fairfax Financial Holdings Limited 95 Wellington Street West Suite 800 Toronto, Ontario M5J 2N7 Bradley P. Martin Vice President, Canadian (Vice President and Director) Fairfax Financial Holdings Limited V. Prem Watsa Chairman and Chief Executive Officer, Canadian (Vice President and Director) Fairfax Financial Holdings Limited Ronald Schokking Vice President, Finance, Canadian (Vice President) Fairfax Financial Holdings Limited M. Jane Williamson Vice President, Canadian (Director) Fairfax Financial Holdings Limited
31 ANNEX F DIRECTORS AND EXECUTIVE OFFICERS OF FAIRFAX INC. The following table sets forth certain information with respect to the directors and executive officers of Fairfax Inc.
PRESENT PRINCIPAL OCCUPATION OR EMPLOYMENT AND THE NAME, PRINCIPAL BUSINESS AND ADDRESS OF ANY CORPORATION OR OTHER ORGANIZATION IN WHICH SUCH NAME EMPLOYMENT IS CONDUCTED CITIZENSHIP ---- --------------------------------------- ------------- Eric P. Salsberg Vice President, Corporate Affairs, Canadian (Vice President and Director) Fairfax Financial Holdings Limited 95 Wellington Street West Suite 800 Toronto, Ontario M5J 2N7 James F. Dowd Chairman, President and Chief Executive United States (Chairman, President and Chief Executive Officer) Officer, Fairfax Inc. 305 Madison Avenue Morristown, NJ 07906 Ronald Schokking Vice President, Finance, Canadian (Vice President) Fairfax Financial Holdings Limited Roland W. Jackson Vice President, Treasurer and Director, United States (Vice President, Treasurer and Director) Fairfax Inc. Trevor J. Ambridge Vice President and Chief Financial Canadian (Vice President) Officer, Fairfax Financial Holdings Limited
32 ANNEX G MEMBERS OF THE BOARD OF MANAGERS AND EXECUTIVE OFFICERS OF FAIRFAX FINANCIAL (US) LLC The following table sets forth certain information with respect to the members of the board of managers and executive officers of Fairfax Financial (US) LLC.
PRESENT PRINCIPAL OCCUPATION OR EMPLOYMENT AND THE NAME, PRINCIPAL BUSINESS AND ADDRESS OF ANY CORPORATION OR OTHER ORGANIZATION IN WHICH SUCH NAME EMPLOYMENT IS CONDUCTED CITIZENSHIP ---- --------------------------------------- ------------- John K. Cassil Assistant Secretary, United States (President and Manager) TIG Insurance Company 5205 North O'Connor Blvd. Irving, Texas 75039 Roland Jackson Vice President, United States (Manager) Fairfax Inc. 305 Madison Avenue Morristown, NJ 07906 William McManus Managing Director, United States (Manager) Horizon Management, Inc. 8318 Pineville-Matthews Road Suite 390 G Charlotte, NC 28226 Bradley P. Martin Vice President, Canadian (Vice President) Fairfax Financial Holdings Limited 95 Wellington Street West Suite 800 Toronto, Ontario M5J 2N7
33 ANNEX H DIRECTORS AND EXECUTIVE OFFICERS OF TIG HOLDINGS, INC. The following table sets forth certain information with respect to the directors and executive officers of TIG Holdings, Inc.
PRESENT PRINCIPAL OCCUPATION OR EMPLOYMENT AND THE NAME, PRINCIPAL BUSINESS AND ADDRESS OF ANY CORPORATION OR OTHER ORGANIZATION IN WHICH SUCH NAME EMPLOYMENT IS CONDUCTED CITIZENSHIP ---- --------------------------------------- ------------- V. Prem Watsa Chairman and Chief Executive Officer, Canadian (Chairman and Director) Fairfax Financial Holdings Limited 95 Wellington Street West Suite 800 Toronto, Ontario M5J 2N7 Trevor J. Ambridge Vice President and Chief Canadian (Director) Financial Officer, Fairfax Financial Holdings Limited Dennis C. Gibbs Chief Executive Officer and Director, United States (Chief Executive Officer and Director) TIG Insurance Company R. Scott Donovan President and Director, United States (President and Director) TIG Insurance Company Michael J. Sluka Senior Vice President, Chief Financial United States (Senior Vice President, Chief Financial Officer Officer and Treasurer and Director, and Treasurer) TIG Insurance Company
34 ANNEX I DIRECTORS AND EXECUTIVE OFFICERS OF TIG INSURANCE GROUP The following table sets forth certain information with respect to the directors and executive officers of TIG Insurance Group.
PRESENT PRINCIPAL OCCUPATION OR EMPLOYMENT AND THE NAME, PRINCIPAL BUSINESS AND ADDRESS OF ANY CORPORATION OR OTHER ORGANIZATION IN WHICH SUCH NAME EMPLOYMENT IS CONDUCTED CITIZENSHIP ---- --------------------------------------- ------------- R. Scott Donovan President and Director, United States (President and Director) TIG Insurance Company 5205 North O'Connor Blvd., Irving, Texas 75039 Dennis C. Gibbs Chief Executive Officer and Director, United States (Chief Executive Officer and Director) TIG Insurance Company Charles G. Ehrlich Senior Vice President and Director, United States (Senior Vice President, General Counsel and TIG Insurance Company Secretary) Michael J. Sluka Senior Vice President, Chief Financial United States (Senior Vice President, Chief Financial Officer, Officer, Treasurer and Director, Treasurer, and Director) TIG Insurance Company William J. Gillett Managing Director -- Europe, United States (Director) RiverStone Holdings Limited
35 ANNEX J DIRECTORS AND EXECUTIVE OFFICERS OF TIG INSURANCE COMPANY The following table sets forth certain information with respect to the directors and executive officers of TIG Insurance Company.
PRESENT PRINCIPAL OCCUPATION OR EMPLOYMENT AND THE NAME, PRINCIPAL BUSINESS AND ADDRESS OF ANY CORPORATION OR OTHER ORGANIZATION IN WHICH SUCH NAME EMPLOYMENT IS CONDUCTED CITIZENSHIP ---- --------------------------------------- ------------- Dennis C. Gibbs Chairman, Chief Executive Officer and United States (Chairman, Chief Executive Officer and Director) Director, TIG Insurance Company R. Scott Donovan President and Director, United States (President and Director) TIG Insurance Company Charles G. Ehrlich Senior Vice President and Director, United States (Senior Vice President and Director) TIG Insurance Company John M. Parker Senior Vice President, General Counsel, United States (Senior Vice President, General Counsel, and and Secretary, Secretary) TIG Insurance Company Robert L. Gossett Senior Vice President and Director, United States (Senior Vice President and Director) TIG Insurance Company Michael J. Sluka Senior Vice President, Chief Financial United States (Senior Vice President, Chief Financial Officer, Officer, Treasurer and Director, Treasurer and Director) TIG Insurance Company
36 ANNEX K DIRECTORS AND EXECUTIVE OFFICERS OF ORH HOLDINGS INC. The following table sets forth certain information with respect to the directors and executive officers of ORH Holdings Inc.
PRESENT PRINCIPAL OCCUPATION OR EMPLOYMENT AND THE NAME, PRINCIPAL BUSINESS AND ADDRESS OF ANY CORPORATION OR OTHER ORGANIZATION IN WHICH SUCH NAME EMPLOYMENT IS CONDUCTED CITIZENSHIP ---- --------------------------------------- ------------- Andrew A. Barnard President and Chief Executive Officer, United States (President) Odyssey Re Holdings Corp. 300 First Stamford Place, Stamford, Connecticut 06902 Eric P. Salsberg Vice President, Corporate Affairs, Canadian (Vice President and Director) Fairfax Financial Holdings Limited 95 Wellington Street West Suite 800 Toronto, Ontario Bradley P. Martin Vice President, Canadian (Vice President and Director) Fairfax Financial Holdings Limited
37 ANNEX L DIRECTORS AND EXECUTIVE OFFICERS OF UNITED STATES FIRE INSURANCE COMPANY The following table sets forth certain information with respect to the directors and executive officers of United States Fire Insurance Company.
PRESENT PRINCIPAL OCCUPATION OR EMPLOYMENT AND THE NAME, PRINCIPAL BUSINESS AND ADDRESS OF ANY CORPORATION OR OTHER ORGANIZATION IN WHICH SUCH NAME EMPLOYMENT IS CONDUCTED CITIZENSHIP ---- ----------------------------------------- ------------- Nikolas Antonopoulos Chief Executive Officer and President, United States (Chairman of the Board, Chief Executive Officer and Director) Crum & Forster Holdings Corp. and various other insurance subsidiaries 305 Madison Avenue Morristown, NJ 07962 Mary Jane Robertson Executive Vice President, Chief United States (Senior Executive Vice President, Chief Financial Financial Officer and Treasurer, Officer, Treasurer and Director) Crum & Forster Holdings Corp. and various other insurance subsidiaries Dennis J. Hammer Senior Vice President and Controller, United States (Senior Vice President and Controller) United States Fire Insurance Company Joseph F. Braunstein, Jr. President and Director, United States (President and Director) United States Fire Insurance Company
38 EXHIBIT INDEX
EXHIBIT NO. DESCRIPTION - ----------- ----------- 2.1 Master Note Purchase Agreement dated as of November 19, 2004. 2.2 Promissory Note ("Note 1") in the amount of $68,092,000 due November 19, 2009 exchangeable into 2,900,000 Shares. 2.3 Promissory Note ("Note 2") in the amount of $11,740,000 due November 19, 2009 exchangeable into 500,000 Shares. 2.4 Promissory Note ("Note 3") in the amount of $11,740,000 due November 19, 2009 exchangeable into 500,000 Shares. 2.5 Promissory Note ("Note 4") in the amount of $9,392,000 due November 19, 2009 exchangeable into 400,000 Shares. 2.6 Note Purchase Confirmation No. 1 relating to Note 1. 2.7 Note Purchase Confirmation No. 2 relating to Note 2. 2.8 Note Purchase Confirmation No. 3 relating to Note 3. 2.9 Note Purchase Confirmation No. 4 relating to Note 4. 2.10 Pledge Agreement dated as of November 19, 2004. 2.11 Joint filing agreement dated as of November 23, 2004 between V. Prem Watsa, 1109519 Ontario Limited, The Sixty Two Investment Company Limited, 810679 Ontario Limited, Fairfax Financial Holdings Limited, FFHL Group Limited, Fairfax Inc., Fairfax Financial (US) LLC, TIG Holdings, Inc., TIG Insurance Group, TIG Insurance Company, ORH Holdings Inc., and United States Fire Insurance Company.
39 EX-2.1 2 t14767exv2w1.txt EX-2.1 MASTER NOTE PURCHASE AGREEMENT This Master Note Purchase Agreement (this "AGREEMENT") is made as of this 19th day of November, 2004 among Fairfax Financial (US) LLC, a Delaware limited liability company (the "ISSUER"), NMS Services (Cayman) Inc., a company organized under the laws of the Cayman Islands (the "PURCHASER"), Fairfax Financial Holdings Limited, a corporation incorporated under the laws of Canada, as guarantor (the "GUARANTOR"), and Banc of America Securities LLC, as agent (the "AGENT"). WITNESSETH WHEREAS, pursuant to a Master Note Purchase Agreement dated as of March 3, 2003 among the Issuer, the Purchaser, the Guarantor and the Agent (the "PREVIOUS AGREEMENT"), the issuer issued certain Notes (as defined therein) thereunder (the "PREVIOUS NOTES") to the Purchaser; WHEREAS, the Issuer and the Purchaser wish to sell and purchase the Issuer's promissory notes (each, a "NOTE") on the terms and conditions set forth herein; WHEREAS, the Issuer and the Guarantor intend that the transactions contemplated hereby result in the Guarantor being able to treat members of the consolidated group (within the meaning of U.S. Treasury Regulations section 1.1502-1(h)), of which Fairfax, Inc., a wholly-owned subsidiary of the Guarantor, is the common parent, as owning at least 80 percent of the outstanding Shares (as defined below) and therefore treat Odyssey (as defined below) as a member of such group for U.S. federal income tax purposes; WHEREAS, the Issuer has agreed, pursuant to a Pledge Agreement dated as of the date hereof, as amended from time to time (the "PLEDGE AGREEMENT"), to continue, as security for certain of the Issuer's obligations under this Agreement and the Notes, a security interest in the collateral described therein granted to the Purchaser pursuant to a Pledge Agreement, dated as of March 3, 2003 among the Issuer, the Purchaser and the Agent to secure certain of the Issuer's obligations under the Previous Agreement and the Previous Notes; NOW, THEREFORE, in consideration of their mutual covenants herein contained, the parties hereto, intending to be legally bound, hereby mutually covenant and agree as follows: SECTION 1. Definitions. As used herein, the following terms have the following meanings: "ACTUAL HEDGE COST" means the cost to the Purchaser or its affiliates of establishing, re-establishing or maintaining any transactions necessary or advisable to hedge, directly or indirectly, the equity price risk of entering into the transactions contemplated by this Agreement on terms deemed reasonable by the Purchaser, including without limitation the cost of establishing, re-establishing or maintaining a full hedge of its position in respect of any Note or Exchange Shares through share borrowing arrangements on terms deemed reasonable by the Purchaser. "AGREEMENT" has the meaning specified in the preamble and includes each Note Purchase Confirmation executed by the Issuer and the Purchaser pursuant hereto. "BUSINESS DAY" means any day on which commercial banks are open for business in New York City and the NYSE is not closed. "CALCULATION AGENT" means Banc of America Securities LLC. "CLOSING PRICE" means, for any Note, the per Share closing price of the Shares for the regular trading session on the NYSE on the Issue Date for such Note (or, if such date is not a Business Day, the immediately preceding Business Day). "CODE" has the meaning specified in Section 6(c). "EQUITY DEFINITIONS" means the 1996 ISDA Equity Derivatives Definitions published by ISDA. "EVENT OF DEFAULT" has the meaning specified in Section 13. "EXCESS HEDGE COST" means, as of any date, the sum of the daily amounts of the daily Actual Hedge Cost in respect of all outstanding Notes over the Maximum Hedge Cost up to and including such date. "EXCHANGE DATE" means, for any Note, any date designated as such pursuant to Section 7(a), Section 7(b) or Section 7(c). "EXCHANGE PERIOD" means, for any Note, the period specified in the Note Purchase Confirmation for such Note, which shall begin no earlier than the Issue Date for such Note and end no later than 24 months after the Issue Date for such Note. "EXCHANGE PERIOD END DATE" means, for any Note, the last day in the Exchange Period for such Note. "EXCHANGE PRICE" means, for any Note, the price specified as such in the Note Purchase Confirmation for such Note, which on the Issue Date may not be less than the Closing Price, subject to adjustment pursuant to Section 7(g). 2 "EXCHANGE SHARES" means, for any Note or any portion of any Note, a number of Shares equal to the quotient obtained by dividing the principal amount of such Note or portion by the Exchange Price for such Note. "EXTRAORDINARY DIVIDEND" has the meaning set forth in Section 7(b). "GUARANTOR" has the meaning specified in the preamble. "GUARANTEED OBLIGATIONS" means (i) all principal of, premium and interest on the Notes (including, without limitation, any interest ("POST-PETITION INTEREST") that accrues (or which would accrue but for such case, proceeding or action) after the commencement of any case, proceeding or other action relating to the bankruptcy, insolvency or reorganization of the Issuer (whether or not such interest is allowed or allowable as a claim in any such case, proceeding or other action) on the Notes), (ii) the delivery of Exchange Shares by the Issuer when due pursuant to the terms of the Notes, (iii) all other amounts payable by the Issuer from time to time under the Notes (including any Post-Petition Interest with respect to such amounts) and (iv) any renewals, refinancings or extensions of any of the foregoing (including Post-Petition Interest). "HEDGE COST REIMBURSEMENT AGREEMENT" means the Hedge Cost Reimbursement Agreement dated as of the date hereof between the Purchaser and the Guarantor. "HEDGE DISRUPTION EVENT" means, as determined by the Calculation Agent, the inability or impracticality on any day, due to market illiquidity, Illegality (as defined in the ISDA Master Agreement, but with respect to the Purchaser's hedging activities relating to any Note), lack of hedging transactions, lack of credit worthy market participants or otherwise, of the Purchaser or an affiliate of the Purchaser to establish, re-establish or maintain any transactions necessary or advisable to hedge, directly or indirectly, the equity price risk of holding the Notes on terms deemed reasonable by the Purchaser and at a daily Actual Hedge Cost that is equal to or less than the Maximum Hedge Cost. "INTEREST PAYMENT DATE" means, for any Note, each of the dates specified as such in the Note Purchase Confirmation for such Note. "INTEREST PERIOD" means, for any Note, each period from and including one Interest Payment Date to but excluding the next following Interest Payment Date, except that (a) the initial Interest Period for any Note will commence on and include the Issue Date for such Note and (b) the final Interest Period for any Note will end on but exclude the Maturity Date for such Note. "INTEREST RATE" applicable to any Interest Period for any Note means the rate specified as such in the Note Purchase Confirmation for such Note. 3 "INTREPID PORTFOLIOS" means Intrepid Portfolios LLC, a Delaware limited liability company. "ISDA" means the International Swaps and Derivatives Association, Inc. "ISDA MASTER AGREEMENT" means the 1992 ISDA Master Agreement (Multicurrency-Cross Border) published by ISDA. "ISSUE DATE" means, for any Note, the date specified as such in the Note Purchase Confirmation for such Note. "ISSUER" has the meaning specified in the preamble. "LIQUIDATED AMOUNT" has the meaning specified in Section 7(j). "MATURITY DATE" means, for any Note, the date specified as such in the Note Purchase Confirmation for such Note. "MAXIMUM HEDGE COST" means an amount, calculated by the Calculation Agent, equal to the daily equivalent of 1.00% per annum of the principal amount of all Notes outstanding. "NASD" means the National Association of Securities Dealers, Inc. "NOTE" has the meaning specified in the recitals. "NOTE PURCHASE CONFIRMATION" has the meaning specified in Section 2. "NYSE" means the New York Stock Exchange, Inc. "ODYSSEY" means Odyssey Re Holdings Corp., a Delaware corporation. "ORDINARY DIVIDEND AMOUNT" means USD0.03125 per Share per calendar quarter, subject to adjustment pursuant to Section 7(g). "PLEDGE AGREEMENT" has the meaning specified in the recitals. "PREPAID INTEREST AMOUNT" means, for any Note, the amount of cash specified as such in the Note Purchase Confirmation for such Note. "PREVIOUS AGREEMENT" has the meaning specified in the recitals. "PREVIOUS NOTES" has the meaning specified in the recitals. "PURCHASE CONSIDERATION" means, for each Note, the consideration specified as such in the Note Purchase Confirmation for such Note. 4 "PURCHASE SHARES" means the Purchase Shares as defined in, and delivered to the Issuer pursuant to, the Previous Agreement. "PURCHASER" has the meaning specified in the preamble. "REGISTRATION DEFAULT" has the meaning specified in Section 13(b). "REGISTRATION RIGHTS AGREEMENT" means the Registration Rights Agreement dated as of the date hereof among Odyssey, the Purchaser, individually and as representative of the Holders named therein, and Banc of America Securities LLC. "SECURITIES ACT" means the Securities Act of 1933, as amended. "SHARES" means shares of common stock, par value USD0.01, of Odyssey. "TAXES" has the meaning specified in Section 6(b). "TRANSACTION DOCUMENTS" means (i) this Agreement, (ii) the Notes, (iii) the Pledge Agreement, (iv) any Note Purchase Confirmation, (v) the Registration Rights Agreement, (vi) the Hedge Cost Reimbursement Agreement and (vii) the Limited Liability Company Agreement of the Issuer dated as of March 3, 2003, as amended. SECTION 2. Note Purchase Confirmations. At any time and from time to time, the Issuer and the Purchaser may execute a note purchase confirmation substantially in the form of Exhibit A hereto (a "NOTE PURCHASE CONFIRMATION") pursuant to which the Issuer shall issue and sell to the Purchaser, and the Purchaser shall purchase from the Issuer, a Note on the terms and conditions set forth herein and in such Note Purchase Confirmation. SECTION 3. Sale and Purchase. (a) Upon the terms and subject to the conditions set forth herein and in the Note Purchase Confirmation for any Note, the Issuer agrees to issue and sell to the Purchaser, and the Purchaser agrees to purchase from the Issuer, on the Issue Date set forth in such Note Purchase Confirmation, a Note having the terms set forth herein, in such Note Purchase Confirmation and in such Note. (b) Upon the terms and subject to the conditions set forth herein and in the Note Purchase Confirmation for such Note, on the Issue Date for such Note, (i) the Purchaser will pay or deliver the Purchase Consideration for such Note to the Issuer or otherwise satisfy the Purchase Consideration and (ii) the Issuer will (A) deliver such Note substantially in the form of Exhibit B hereto, duly completed with the terms and conditions set forth in the Note Purchase Confirmation for such Note, to the Purchaser (or an agent of Purchaser specified by the Purchaser) and (B) pay the Prepaid Interest Amount for such Note to the Purchaser by wire transfer of immediately available funds to an account 5 designated by the Purchaser, in each case against such payment, delivery or satisfaction of the Purchase Consideration. SECTION 4. Principal. (a) The principal amount of each Note, together with any accrued and unpaid interest thereon, will be payable on the Maturity Date for such Note. SECTION 5. Interest. (a) Each Note shall bear interest on the outstanding principal amount thereof, for each day during each Interest Period for such Note, at a rate per annum equal to the Interest Rate applicable to such Interest Period, calculated on the basis of a year of 360 days and paid for the actual number of days elapsed. Such interest shall be payable for each Interest Period in arrears on each Interest Payment Date for such Note. Notwithstanding the foregoing, the Issuer's payment of the Prepaid Interest Amount for any Note on the Issue Date for such Note in accordance with Section 3(b) shall satisfy the Issuer's obligation to pay interest in respect of such Note on each of the Interest Payment Dates occurring prior to the Exchange Period End Date. (b) To the extent that the payment of such interest shall be legally enforceable, (i) any overdue principal or interest on any Note shall bear interest, payable on demand, for each day until paid at a rate per annum equal to the prime rate as published in The Wall Street Journal, Eastern Edition applicable to the Interest Period that includes such day (or the last Interest Period for such Note, if such day falls on or after the Maturity Date for such Note) plus 2%, and (ii) any such interest on any overdue principal that is not so paid on demand shall bear interest, payable on demand, for each day until paid at the same rate as the overdue interest. SECTION 6. Payments. (a) All payments of, or in respect of, principal and interest on the Notes shall be made in such coin or currency of the United States of America as at the time of payment is legal tender for payment of public and private debts by wire transfer of immediately available funds to an account designated by the Purchaser. (b) Subject to Sections 6(c) and 6(d) below, all payments of, or in respect of, principal and interest on the Notes made by the Issuer hereunder will be made without withholding or deduction for, or on account of, any present or future taxes, duties, fines, penalties, assessments or other governmental charges of whatsoever nature (or interest on any taxes, duties, fines, penalties, assessments or other governmental charges of whatsoever nature) imposed, levied, collected, withheld or assessed by, within or on behalf of any jurisdiction in which the Issuer is organized, deemed to reside or engaged in business for tax purposes, or any jurisdiction from or through which any amount is paid by the Issuer or any political subdivision or governmental authority thereof or therein having power to tax (collectively "TAXES"), unless such withholding or deduction is required by law. If any such Taxes shall at any time be required in 6 respect of the payment of any amounts by the Issuer under any Note, the Issuer will pay to the Purchaser such additional amounts as may be necessary to ensure that the amounts received by the Purchaser after such withholding or deduction shall equal the amounts of principal and interest that would have been receivable in respect of such Note in the absence of such withholding or deduction. (c) To the extent permitted by applicable law, if the Purchaser is not a United States person within the meaning of section 7701(a)(30) of the United States Internal Revenue Code of 1986, as amended (the "CODE"), the Purchaser shall deliver to the Issuer on or prior to the Issue Date two properly completed and duly executed original signed copies of IRS Form W-8BEN, W-8ECI, or W-8IMY (or any successor or other applicable form) certifying to the Purchaser's entitlement to a complete exemption from United States withholding tax on interest payments to be made under the Notes. If the Purchaser is claiming a complete exemption from withholding on interest pursuant to Section 881(c) of the Code, in addition to a properly completed and duly executed Form W-8BEN, the Purchaser shall provide to the Issuer a certificate, in form and substance reasonably acceptable to the Issuer, substantially to the effect that it is not a bank extending credit made pursuant to a loan agreement entered into in the ordinary course of its trade or business. If the Purchaser is a United States person within the meaning of section 7701(a)(30) of the Code, the Purchaser shall provide two properly completed and duly executed copies of IRS Form W-9 (or any successor or other applicable form) to the Issuer certifying that the Purchaser is exempt from United States backup withholding tax. (d) The Issuer shall not be required to pay additional amounts to the Purchaser pursuant to Section 6(b) to the extent that such obligations would not have arisen but for the failure of the Purchaser to comply with Section 6(c). SECTION 7. Right to Exchange Notes. (a) On any Business Day during the Exchange Period for any Note, by notice to the Issuer not less than five Business Days prior to such Business Day (the "EXCHANGE DATE"), the Purchaser shall have the right to exchange such Note or any portion of such Note for the Exchange Shares for such Note or such portion. (b) If, at any time prior to the Exchange Period End Date for any Note, Odyssey shall declare either a dividend on the Shares to be paid in property other than cash or Shares or a cash dividend on the Shares that, together with all other such dividends for which the ex-dividend date occurs during the same calendar quarter as the ex-dividend date for such dividend, exceeds the Ordinary Dividend Amount per Share (such dividend, an "EXTRAORDINARY DIVIDEND"), the Purchaser shall have the right to designate any Business Day on or prior to the Exchange Period End Date and prior to the record date of such Extraordinary Dividend as the Exchange Date for such Note, in which event the notice period 7 required by Section 7(a) shall be the shorter of (x) three Business Days and (y) the period from the Business Day immediately following the date of public announcement of such declaration to the Business Day immediately preceding such record date. (c) If at any time prior to the Exchange Period End Date for any Note, a Hedge Disruption Event shall have occurred, the Purchaser shall so inform the Issuer promptly and shall have the right to designate any Business Day on or prior to the Exchange Period End Date as the Exchange Date for such Note or any portion of such Note; provided that the Purchaser shall not have the right to so designate an Exchange Date pursuant to this Section 7(c) if (i) the Hedge Disruption Event shall have occurred because any daily Actual Hedge Cost exceeded the Maximum Hedge Cost, (ii) the Issuer shall have paid to the Purchaser, on or prior to the third Business Day following the notice of such Hedge Disruption Event, the Excess Hedge Cost as of the time the Purchaser gives such notice by wire transfer in immediately available funds to an account designated by the Purchaser and (iii) the Issuer shall have entered into an agreement with the Purchaser, reasonably acceptable to the Purchaser, on or prior to the third Business Day following such Notice, to compensate the Purchaser at least as frequently as monthly for any future Excess Hedge Cost in respect of such Note. (d) Notwithstanding the foregoing, if the Purchaser elects to exercise its right to exchange any Note or any portion of any Note and surrenders such Note to the Issuer on or prior to the Exchange Date for such Note, the Issuer shall deliver to the Purchaser on such Exchange Date the Exchange Shares for such Note or such portion by book-entry transfer to an account designated by the Purchaser. The Issuer represents and agrees that delivery of any Exchange Shares will pass to the Purchaser title to such Exchange Shares free and clear of any liens or encumbrances. If the Purchaser exercises such right with respect to a portion but not all of any Note, the Issuer shall issue to the Purchaser a new certificate representing the portion of such Note with respect to which the Purchaser does not exercise such right, and Section 16(d) and Section 16(e) shall apply to such issuance. The Issuer shall not be required to deliver any fractional Exchange Shares, but may instead deliver cash in lieu thereof at the closing price of the Shares on the NYSE on the immediately preceding Business Day. (e) [Reserved]. (f) The parties agree that the delivery of Exchange Shares (or cash in lieu of fractional shares) upon exchange of any Note or portion thereof as set forth in this Section 7 shall be considered a payment in full of the principal of such Note or portion thereof exchanged for all purposes of this Agreement. (g) If a Potential Adjustment Event (as defined in the Equity Definitions) occurs, the Exchange Price and the Ordinary Dividend Amount 8 shall be subject to adjustment by the Calculation Agent in a manner consistent, mutatis mutandis, with "Calculation Agent Adjustment" as defined in Article 9 of the Equity Definitions, as if the exchange right described in this Section were set forth in a Confirmation (as defined in the ISDA Master Agreement) for a Share Option Transaction (as defined in the Equity Definitions) and Odyssey were the Issuer (as defined in the Equity Definitions), with the following amendments: (i) The first paragraph of Section 9.1(c) of the Equity Definitions is hereby amended to read as follows: "(c) If "Calculation Agent Adjustment" is specified as the method of adjustment in the Confirmation of a Share Option Transaction, then following the declaration by the Issuer of the terms of any Potential Adjustment Event, the Calculation Agent will determine whether such Potential Adjustment Event has a material effect on the theoretical value of the relevant Shares or Options and, if so, may in its sole discretion make appropriate adjustments to the Exchange Price, the Ordinary Dividend Amount and any other variable relevant to the exercise, settlement or payment terms of such Share Option Transaction", and the sentence immediately preceding Section 9.1(c)(ii) is hereby amended by deleting the words "diluting or concentrative". (ii) Section 9.1(e) of the Equity Definitions shall be amended to add the new following subsection (vii): "(vii) any tender offer with respect to the Shares and is not a Merger Event as defined in Section 9.2 of the Equity Definitions and is deemed to be material in the determination of the Calculation Agent". (iii) Section 9.1(e)(vi) of the Equity Definitions is hereby amended by deleting the words "other similar" between "any" and "event" and replacing it with the word "corporate"; deleting the words "diluting or concentrative" and replacing them with "material"; and adding the following words at the end of the sentence "or Options". (iv) Section 9.1(e) of the Equity Definitions shall be amended by deleting subsection (iii) thereof. (h) If a Merger Event (as defined in the Equity Definitions) occurs, the provisions of Sections 9.2, 9.3, 9.4, 9.5 and 9.7 shall apply to the Notes, mutatis mutandis, as if (i) each Note were a Share Option Transaction (as defined in the Equity Definitions) with an Expiration Date (as defined in the Equity Definitions) of the Exchange Date for such Note and Odyssey were the Issuer (as defined in the Equity Definitions), (ii) the elections under "Consequences of Merger Events" were (A) "Cancellation and Payment" for a Share-for-Other Merger Event and a Share-for-Combined Merger Event and (B) "Modified 9 Alternative Obligation" for a Share-for-Share Merger Event, and (iii) the Equity Definitions were amended as follows: (i) Section 9.3(b) of the Equity Definitions shall be amended to add the following subsection (iv): "(iv) "Modified Alternative Obligation" means that the Calculation Agent will make the adjustments set forth under Alternative Obligation; provided, however, the Calculation Agent will determine if any such Merger Event affects the theoretical value of the Share Option Transaction and, if so, may in its sole discretion make an adjustment to the Exchange Price and any other variable relevant to the exercise, settlement or payment terms of the Share Option Transaction to reflect the characteristics (including, without limitation, the volatility, dividend practice and policy and liquidity) of the New Shares. Any such adjustment made will be effective as of the date determined by the Calculation Agent."; (ii) The first paragraph of Section 9.7(b) of the Equity Definitions shall be amended by (1) deleting from the second sentence thereof the words "after that date" between the words "that would have been required" and "but for the occurrence of the Option Value Event" and by (2) deleting the period at the end of subsection (iii) thereof and inserting the following words therefor: "; and (iv) a term equal to the number of days from the Announcement Date through and including the Expiration Date". (i) The adjustments described in paragraphs (g) and (h) above will be made successively whenever any Potential Adjustment Event or Share-for-Share Merger Event may occur. For greater certainty, the Calculation Agent shall not make any adjustment to the principal amount of any Note or the Exchange Date or Interest Rate for any Note. (j) If the Purchaser elects to exercise such right to exchange any Note or any portion of any Note as set forth in this Section 7 and the Issuer does not deliver the Exchange Shares for such Note or such portion at the time and in the manner required by this Agreement, the Purchaser shall be entitled to liquidated damages (the "LIQUIDATED AMOUNT") equal to the Purchaser's cost of purchasing in the open market a number of Shares equal to the number of Exchange Shares to which the Purchaser is entitled pursuant to this Section 7. The Purchaser shall be entitled to deliver to itself any Shares pledged pursuant to the Pledge Agreement in full or partial, as the case may be, satisfaction of the Issuer's obligation to pay the Liquidated Amount. (k) The Issuer understands its reporting obligations under Sections 13 and 16 of the Securities Exchange Act of 1934 (the "EXCHANGE ACT"), as amended, with respect to the transactions contemplated hereby and shall comply 10 with such obligations, and shall provide the Purchaser with a copy of any report filed thereunder in respect of such transactions. (l) Notwithstanding any other provisions hereof, the Purchaser shall not be entitled to receive Shares hereunder (whether in connection with the exchange of any Notes or otherwise) to the extent (but only to the extent) that such receipt would result in Bank of America Corporation directly or indirectly beneficially owning (as such term is defined for purposes of Section 13(d) of the Exchange Act) at any time in excess of 9.9% of the outstanding shares of any class of equity securities of Odyssey. Any purported delivery hereunder shall be void and have no effect to the extent (but only to the extent) that such delivery would result in Bank of America Corporation so beneficially owning in excess of 9.9% of the outstanding shares of any such class. If any delivery owed to the Purchaser hereunder is not made, in whole or in part, as a result of this Section 7(l), the Issuer's obligation to make such delivery shall not be extinguished and the Issuer shall make such delivery as promptly as practicable after, but in no event later than one Business Day after, the Purchaser gives notice to the Issuer that such delivery would not result in Bank of America Corporation so beneficially owning in excess of 9.9% of the outstanding shares of any such class. SECTION 8. Representations and Warranties of the Issuer and the Guarantor. Each of the Issuer and the Guarantor represents and warrants to the Purchaser and the Agent, as of the date hereof, as of the date of each Note Purchase Confirmation and as of the Issue Date for each Note, that: (a) it is duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization or incorporation; (b) it has the power to execute this Agreement, any Note and any other Transaction Document or other documentation relating to this Agreement to which it is a party, to deliver this Agreement, each Note and each other Transaction Document and other documentation relating to this Agreement that it is required by this Agreement to deliver and to perform its obligations under this Agreement (including, without limitation, the issuance of the Notes) and any other Transaction Agreement and has taken all necessary action to authorize such execution, delivery and performance; (c) such execution, delivery and performance do not violate or conflict with any law applicable to it, any provision of its constitutional documents, any order or judgment of any court or other agency of government applicable to it or any of its assets or any contractual restriction binding on or affecting it or any of its assets; (d) all governmental and other consents that are required to have been obtained by it with respect to this Agreement, any Note and any other 11 Transaction Document have been obtained and are in full force and effect and all conditions of any such consents have been complied with; (e) its obligations under this Agreement, each other Transaction Document and, when issued and delivered pursuant to this Agreement and the Note Purchase Confirmation for such Note, each Note constitute legal, valid and binding obligations, enforceable in accordance with their respective terms, subject to applicable bankruptcy, insolvency and similar laws affecting creditors' rights generally and to general equitable principles; (f) no Event of Default with respect to it has occurred and is continuing and no such event or circumstance would occur as a result of its entering into or performing its obligations under this Agreement, any Note or any other Transaction Document; (g) there is not pending or, to its knowledge, threatened against it or any of its affiliates any action, suit or proceeding at law or in equity or before any court, tribunal, governmental body, agency or official or any arbitrator that is likely to affect the legality, validity or enforceability against it of this Agreement, any Note or any other Transaction Document or its ability to perform its obligations under this Agreement, any Note or any other Transaction Document; (h) except as previously disclosed to the Purchaser or its affiliates, it has not, nor has anyone acting on its behalf (other than the Purchaser and the Agent), offered or sold any Note to, or solicited offers to buy any Note from, or otherwise approached or negotiated with respect thereto with, any prospective purchaser (other than the Purchaser); (i) assuming the accuracy of the representations and agreements of the Purchaser in Section 9(f), Section 9(g) and Section 11 hereof, it is not necessary in connection with the offer, sale and delivery of the Notes in the manner contemplated by this Agreement to register the Notes under the Securities Act; (j) it is not and, after giving effect to the sale of the Notes and the application of the proceeds thereof, will not be an "investment company" as such term is defined in the Investment Company Act of 1940, as amended; (k) it is acting for its own account, and has made its own independent decision to enter into this Agreement and each other Transaction Document and as to whether this Agreement and the other Transaction Documents are appropriate or proper for it based upon its own judgment and upon advice of such advisors as it deems necessary; each of the Issuer and the Guarantor acknowledges and agrees that it is not relying, and has not relied, upon any communication (written or oral) of the Purchaser or any affiliate of the Purchaser with respect to the legal, accounting, tax or other implications of this Agreement 12 or any other Transaction Document and that it has conducted its own analyses of the legal, accounting, tax and other implications hereof and thereof (it being understood that information and explanations related to the terms and conditions of this Agreement or any other Transaction Document shall not be considered investment advice or a recommendation to enter into this Agreement or any such Transaction Document); it further acknowledges and confirms that it has taken independent tax advice with respect to this Agreement and each other Transaction Document; (l) each of the Issuer and the Guarantor is entering into this Agreement and the other Transaction Documents with a full understanding of all of the terms and risks hereof and thereof (economic and otherwise) and is capable of evaluating and understanding (on its own behalf or through independent professional advice), and understands and accepts, the terms, conditions and risks; each of the Issuer and the Guarantor is also capable of assuming (financially and otherwise), and assumes, those risks; (m) it acknowledges that neither the Purchaser nor any affiliate of the Purchaser is acting as a fiduciary for or an advisor to the Issuer or the Guarantor in respect of this Agreement or any other Transaction Document; (n) the Issuer was organized on February 28, 2003 for the purpose of participating in the transactions contemplated by the Previous Agreement; (o) (i) the financial statements of the Guarantor, copies of which have been delivered to each of the Purchaser and the Agent, fairly present, in conformity with Canadian generally accepted accounting principles, the consolidated financial position of the Guarantor and its subsidiaries as of the respective dates of such financial statements and their consolidated results of operations, changes in shareholders' equity and cash flows for such period, and (ii) since September 30, 2004, there has been no material adverse change in the business, operations, properties, prospects or condition (financial or otherwise) of the Guarantor and its subsidiaries, taken as a whole; (p) the Issuer is an "Accredited Investor" as such term is defined in Rule 501(a)(3) of Regulation D under the Securities Act; (q) the Issuer acquired the Purchase Shares for its own account and not with a view to the distribution or resale of the Purchase Shares except pursuant to a registration statement declared effective under, or an exemption from the registration requirements of, the Securities Act; (r) the Issuer understands and acknowledges that the Purchaser or an affiliate thereof may possess material, non-public information concerning Odyssey; neither the Purchaser nor any affiliate thereof has disclosed any such 13 information; and the Issuer has not requested the Purchaser or any affiliate of the Purchaser to disclose any of such information to the Issuer; (s) the Issuer, independently, and without reliance upon the Purchaser or any affiliate thereof and based on such information concerning Odyssey that the Issuer obtained from sources other than the Purchaser and its affiliates, made its own investment analysis and decision to make the purchase of the Purchase Shares pursuant to the Previous Agreement; (t) as of the date of the Previous Agreement and the Issue Date (as defined in the Previous Agreement) of the Previous Notes, it was not aware of any material, non-public information concerning Odyssey; and (u) each of the representations and warranties made in each other Transaction Document by each of the Issuer and the Guarantor is true and correct in all material respects, and such representations and warranties are hereby incorporated herein by reference with the same effect as though set forth in their entirety herein, as qualified therein, except to the extent that such representation or warranty relates to a specific date, in which case such representation and warranty shall be true as of such earlier date. SECTION 9. Representations and Warranties of the Purchaser. The Purchaser represents and warrants to each of the Issuer and the Guarantor, as of the date hereof and as of the date of each Note Purchase Confirmation and as of the Issue Date for each Note, that: (a) it is duly organized, validly existing and in good standing under the laws of the jurisdiction of its organization or incorporation; (b) it has the power to execute this Agreement, any Transaction Document or any other documentation relating this Agreement to which it is a party, to deliver this Agreement, any Transaction Document and any other documentation relating to this Agreement that it is required by this Agreement to deliver and to perform its obligations under this Agreement (including, without limitation, the purchase of the Notes) and any other Transaction Document and has taken all necessary action to authorize such execution, delivery and performance; (c) such execution, delivery and performance do not violate or conflict with any law applicable to it, any provision of its constitutional documents, any order or judgment of any court or other agency of government applicable to it or any of its assets or any contractual restriction binding on or affecting it or any of its assets; (d) all governmental and other consents that are required to have been obtained by it with respect to this Agreement have been obtained and are in full 14 force and effect and all conditions of any such consents have been complied with; (e) its obligations under this Agreement constitute its legal, valid and binding obligations, enforceable in accordance with their respective terms, subject to applicable bankruptcy, insolvency and similar laws affecting creditors' rights generally and to general equitable principles; (f) the Purchaser is an "Accredited Investor" as such term is defined in Rule 501(a)(3) of Regulation D under the Securities Act; (g) the Purchaser understands that the Notes will not be and have not been registered under the Securities Act and the sale of the Notes is being made to the Purchaser in reliance on a private placement exemption; the Purchaser is acquiring the Notes for its own account and not with a view to the distribution or resale of the Notes in violation of the Securities Act and the Purchaser is entering into this Agreement on the basis of bilateral discussions with the Issuer and not as the result of any general solicitation or general advertising; (h) upon the crediting of the Purchase Shares for the Previous Notes to a securities account of the Issuer and the issuance and delivery of such Previous Notes against delivery thereof as provided in the Previous Agreement, assuming that the Issuer had no notice of any adverse claim thereto, the Issuer had control of a security entitlement in respect of such Purchase Shares and no action based on an adverse claim to the Purchase Shares, whether framed in conversion, replevin, constructive trust, equitable lien, or other theory, could be asserted against the Issuer (terms used in this paragraph have the meanings as used in Section 8-502 of the Uniform Commercial Code as in effect in the State of New York); and (i) [Reserved.] SECTION 10. Covenants of the Issuer. Each of the Issuer and the Guarantor hereby covenants and agrees with the Purchaser that from the date hereof and for so long as any Note remains outstanding or any amount unpaid under this Agreement or any Note: (a) the Guarantor will deliver to the Purchaser, in form and detail satisfactory to the Purchaser, (i) as soon as available, but in any event within 90 days after the end of each fiscal year of the Guarantor, a consolidated balance sheet of the Guarantor and its subsidiaries as at the end of such fiscal year, and the related consolidated statements of income or operations, shareholders' equity and cash flows for such fiscal year, and (ii) as soon as available, but in any event within 45 days after the end of each of the first three fiscal quarters of each fiscal year of the Guarantor, a consolidated balance sheet of the Guarantor and its subsidiaries as at the end of such fiscal quarter, and the related consolidated 15 statements of income or operations, shareholders' equity and cash flows for such fiscal quarter and for the portion of the Guarantor's fiscal year then ended setting forth in each case in comparative form the figures for the previous fiscal year or quarter and the corresponding portion of the previous fiscal year, all in reasonable detail and certified by an independent certified public accountant (in the case of clause (i)) or an authorized officer of the Guarantor (in the case of clause (ii)) as fairly presenting the financial condition, results of operations and cash flows of the Guarantor and its subsidiaries in accordance with Canadian generally accepted accounting principles as in effect from time to time; (b) the Guarantor will deliver or cause to be delivered to the Purchaser from time to time, upon written request by the Purchaser, such information regarding the business affairs, property and condition, financial or otherwise, of the Guarantor, in such detail as may reasonably be requested, subject to the Purchaser entering into customary confidentiality agreements; (c) it will cause to be delivered to the Purchaser immediately upon the occurrence of any Event of Default hereunder or under the Pledge Agreement notice of such occurrence; (d) it will pay and discharge, and cause each of its subsidiaries to pay and discharge, as the same shall become due and payable, all its obligations and liabilities, including (i) all tax liabilities, assessments and governmental charges or levies upon it or its properties or assets, unless the same are being contested in good faith by appropriate proceedings and adequate reserves in accordance with Canadian generally accepted accounting principles as in effect from time to time are being maintained by it or such subsidiaries; (ii) all lawful claims that, if unpaid, would by law become a lien upon its property; and (iii) all indebtedness, as and when due and payable, but subject to any subordination provisions contained in any instrument or agreement evidencing such indebtedness; (e) it will preserve, renew and maintain in full force and effect its legal existence and good standing under the laws of the jurisdiction of its organization; take all reasonable action to maintain all rights, privileges, permits, licenses and franchises necessary or desirable in the normal conduct of its business; (f) it will comply, and cause each of its subsidiaries to comply, in all material respects with the terms of all Transaction Documents and with all applicable laws, ordinances, rules, regulations, and requirements of governmental authorities (including environmental and labor laws, rules and regulations), except, in the case of the Guarantor, where failure to so comply with laws, ordinances, rules, regulations or requirements would not have a material adverse effect on the business, operations, properties, prospects or condition (financial or otherwise) of the Guarantor and its subsidiaries taken as a whole; 16 (g) it will maintain proper books of record and account, in which full, true and correct entries in conformity with generally accepted accounting principles as in effect from time to time consistently applied shall be made of all financial transactions and matters involving the assets and business of the Issuer and its subsidiaries, and permit representatives and independent contractors of the Purchaser, at the expense of the Purchaser, to visit and inspect any of its properties, to examine its corporate, financial and operating records, and make copies thereof or abstracts therefrom, and to discuss its affairs, finances and accounts with its directors, officers, and independent public accountants, all at such reasonable times during normal business hours and as often as may be reasonably desired, upon reasonable advance notice to it; provided, however, that when an Event of Default exists the Purchaser (or any of its representatives or independent contractors) may do any of the foregoing at the expense of the Issuer at any time during normal business hours and without advance notice; (h) none of it or any of its affiliates or any person acting on behalf of it or any such affiliate will solicit any offer to buy or offer to sell the Notes by means of any form of general solicitation or general advertising; (i) the Issuer will pay all transfer, excise or similar taxes (not including income or franchise taxes) in connection with the issuance, sale, delivery or transfer by the Issuer to the Purchaser of any Note, and shall indemnify and save the Purchaser harmless without limitation as to time against any and all liabilities with respect to such taxes. The obligations of the Issuer under this Section 10(i) shall survive the repayment of the Notes and the termination of this Agreement; and (j) it agrees that the Issuer shall treat the Purchase Shares as if they were restricted securities (as defined under Rule 144 of the Securities Act) and shall not offer, sell or otherwise transfer the Purchase Shares unless and until the Purchase Shares are registered under the Securities Act or an exemption from the registration requirements thereof is available. SECTION 11. Covenants of the Purchaser. The Purchaser hereby covenants and agrees that: (a) it shall not sell or otherwise transfer any Note, except with the consent of the Issuer, such consent not to be unreasonably withheld, and pursuant to a registration statement declared effective under, or an exemption from the registration requirements of, the Securities Act; provided that such consent of the Issuer shall not be required (i) for any sale or transfer of any Note on or following the date one year from the Issue Date for such Note or (ii) at any time to any affiliate of the Purchaser or Intrepid Master Funding Trust or any similar entity sponsored or organized by, or on behalf of or for the benefit of, the Purchaser or an affiliate of the Purchaser; provided further that the Issuer shall have a right of first refusal with respect to any bona fide offer to purchase or 17 acquire any Note that the Purchaser is willing to accept to either pay the purchase price in such offer or designate an alternate buyer reasonably acceptable to the Purchaser who is willing to pay the purchase price in such offer, so long as, in addition to paying the purchase price, the Issuer or such alternate buyer, as the case may be, also agrees to any other terms of such offer including, but not limited to, the assumption by the Issuer or such alternate buyer of any related hedge position; provided further that if the Purchaser sells or transfers any Notes to any person or company (other than Intrepid Portfolios) that would result in the Issuer being required to make payments of additional amounts as provided in Section 6(b), the Issuer shall no longer be required to make any payments required under Section 6(b) in respect of the Notes that have been sold or transferred; provided further that, without limiting the generality of the foregoing, the parties hereto acknowledge that it is their intent that any Notes issued on the date hereof shall immediately subsequent to the issuance thereof be transferred and assigned by the Purchaser to Intrepid Portfolios; (b) none of it, any of its affiliates or any person acting on behalf of it or any such affiliate shall solicit any offer to buy or offer to sell any Note by means of any form of general solicitation or general advertising; and (c) it shall notify the Issuer promptly upon becoming aware of the occurrence or existence of any Registration Default or any event or condition that, with the giving of notice or the passage of time or both, would become a Registration Default. SECTION 12. Conditions. (a) Conditions to Effectiveness. The effectiveness of this Agreement is subject to the satisfaction of each of the following conditions: (i) each of the Transaction Documents shall have been duly executed and delivered by the parties thereto; (ii) the Purchaser shall have received such opinions (in form and substance satisfactory to the Purchaser and its counsel acting reasonably), dated as of the date hereof, of Torys LLP, counsel for the Issuer and the Guarantor, as the Purchaser may reasonably require; (iii) the Purchaser shall have received such opinions (in form and substance satisfactory to the Purchaser and its counsel acting reasonably), dated the date hereof, of Shearman & Sterling LLP, counsel to Odyssey, as the Purchaser may reasonably require; (iv) all documents and instruments required by law or reasonably requested by the Purchaser to be filed, registered or recorded to create the security interest intended to be created by the Pledge Agreement and perfect or record such security interest to the extent, and 18 with the priority, required by the Pledge Agreement, shall have been filed, registered or recorded; and (v) the Issuer shall have furnished to the Purchaser such further certificates and documents as the Purchaser shall reasonably request. (b) Conditions to Effectiveness of any Note Purchase Confirmation and to the Purchaser's Obligations. The effectiveness of any Note Purchase Confirmation for any Note and the obligation of the Purchaser to pay, deliver or otherwise satisfy the Purchase Consideration for such Note on the Issue Date for such Note is subject to the satisfaction of each of the following additional conditions: (i) the Purchaser shall have received (A) an executed copy of the Note Purchase Confirmation for such Note and (B) such Note duly executed and delivered by the Issuer and the Guarantor; (ii) the Initial Pledged Items (as defined in the Pledge Agreement) shall have been delivered to Secured Party (as defined in the Pledge Agreement) pursuant to the Pledge Agreement; (iii) the Purchaser shall have received such opinions (in form and substance satisfactory to the Purchaser and its counsel acting reasonably), dated as of the date of the Note Purchase Confirmation for such Note, of Torys LLP, counsel for the Issuer and the Guarantor, as the Purchaser may reasonably require; (iv) each of the representations and warranties of the Issuer and the Guarantor contained in this Agreement and each Transaction Document to which it is a party shall be true and correct on and as of the date of such Note Purchase Confirmation or the Issue Date, as applicable, as if made on and as of such date; (v) each of the representations and warranties of the Purchaser contained in this Agreement and each Transaction Document to which it is a party shall be true and correct on and as of the date of such Note Purchase Confirmation or Issue Date, as applicable, as if made on and as of such date; (vi) the Issuer shall have complied with all agreements and all conditions to be performed or satisfied by it under this Agreement and each Transaction Document to which it is a party on or prior to the date of such Note Purchase Confirmation or the Issue Date, as applicable; 19 (vii) as of the date of such Note Purchase Confirmation or the Issue Date, as applicable, no Event of Default under this Agreement shall have occurred and be continuing; and (viii)the Guarantor shall have executed the Hedge Cost Reimbursement Agreement and paid the Prepayment Amount (as such term is defined in the Hedge Cost Reimbursement Agreement) to the Purchaser by wire transfer in immediately available funds to an account designated by the Purchaser. SECTION 13. Events of Default. The occurrence of any of the following events shall constitute an event of default (an "EVENT OF DEFAULT") hereunder and under each Note: (a) failure by the Issuer or the Guarantor to make, when due, any payment (including, without limitation, of principal or interest) or delivery under this Agreement, any Note or any other Transaction Document; (b) failure by Odyssey to comply with or perform any agreement or obligation under the Registration Rights Agreement (a "REGISTRATION DEFAULT"); (c) failure by the Issuer to comply with or perform any agreement or obligation (other than an obligation to make any payment or delivery referred to in Section 13(a)) under this Agreement, any Note or any other Transaction Document to be complied with or performed by it in accordance with this Agreement, any Note or any other Transaction Document if such failure is not remedied on or before the thirtieth day after notice of such failure is given to the Issuer; (d) this Agreement, any Note or any other Transaction Document ceases to be in full force and effect, or is declared by a court of competent jurisdiction to be null and void, invalid or unenforceable in any material respect, or the Issuer, the Guarantor or Odyssey disaffirms, disclaims, repudiates or rejects, in whole or in part, or challenges the validity of, this Agreement, any Note or any other Transaction Document; (e) a representation made or repeated or deemed to have been made or repeated by the Issuer, the Guarantor or Odyssey in this Agreement or any other Transaction Document proves to have been incorrect or misleading in any material respect when made or repeated or deemed to have been made or repeated; (f) the occurrence or existence of (i) a default, event of default, termination event or other similar condition or event (however described) in respect of the Issuer or the Guarantor under (A) any Transaction Document or (B) one or more agreements or instruments relating to any indebtedness of the Issuer (individually or collectively) in an aggregate amount of not less than 20 CDN$10,000,000 which has resulted in such indebtedness becoming, or becoming capable at such time of being declared, due and payable under such agreements or instruments before it would otherwise have been due and payable or (ii) a default by the Issuer or the Guarantor (individually or collectively) in making one or more payments on the due date thereof in an aggregate amount of not less than CDN$10,000,000 under such agreements or instruments (after giving effect to any applicable notice requirement or grace period); (g) the Issuer or the Guarantor is (1) dissolved (other than pursuant to a consolidation, amalgamation or merger); (2) becomes insolvent or is unable to pay its debts or fails or admits in writing its inability generally to pay its debts as they become due; (3) makes a general assignment, arrangement or composition with or for the benefit of its creditors; (4) institutes or has instituted against it a proceeding seeking a judgment of insolvency or bankruptcy or any other relief under any bankruptcy or insolvency law or other similar law affecting creditors' rights, or a petition is presented for its winding-up or liquidation, and, in the case of any such proceeding or petition instituted or presented against it, such proceeding or petition (A) results in a judgment of insolvency or bankruptcy or the entry of an order for relief or the making of an order for its winding-up or liquidation or (B) is not dismissed, discharged, stayed or restrained in each case within 15 days of the institution or presentation thereof; (5) has a resolution passed for its winding-up, official management or liquidation (other than pursuant to a consolidation, amalgamation or merger); (6) seeks or becomes subject to the appointment of an administrator, provisional liquidator, conservator, receiver, trustee custodian or other similar official for it or for all or substantially all its assets; (7) has a secured party take possession of all or substantially all its assets or has a distress, execution attachment, sequestration or other legal process levied, enforced or sued on or against all or substantially all its assets and such secured party maintains possession, or any such process is not dismissed, discharged, stayed or restrained, in each case within 15 days thereafter; (8) causes or is subject to any event with respect to it which, under the applicable laws of any jurisdiction, has an analogous effect to any of the events specified in clauses (1) to (7) (inclusive); or (9) takes any action in furtherance of, or indicating its consent to, approval of, or acquiescence in, any of the foregoing acts; (h) due to the adoption of, or any change in, any applicable law after the date hereof, or due to the promulgation of, or any change in, the interpretation by any court, tribunal or regulatory authority with competent jurisdiction of any applicable law after such date, it becomes unlawful for the Issuer, the Guarantor or Odyssey (i) to perform any absolute or contingent obligation to make a payment or delivery, or to receive a payment or delivery in respect of this Agreement or any other Transaction Document or to comply with any other material provision of this Agreement or any other Transaction Document or (2) to perform any contingent or other obligation which the Issuer, 21 Guarantor or Odyssey has under this Agreement or any other Transaction Document; (i) any legal proceeding shall have been instituted or any other event shall have occurred or condition shall exist that is reasonably likely to have a material adverse effect on the ability of the Issuer, the Guarantor or Odyssey to perform its obligations under this Agreement, any Note or any other Transaction Document, or that calls into question the validity or binding effect of any agreement of the Issuer, the Guarantor or Odyssey under this Agreement, any Note or any other Transaction Document; or (j) the occurrence or existence of a Collateral Event of Default (as defined in the Pledge Agreement) under the Pledge Agreement. SECTION 14. Remedies Upon Default. (a) Upon the occurrence, and during the continuance of any Event of Default, the Purchaser may declare the outstanding principal amount of all Notes issued hereunder (together with any accrued and unpaid interest thereon) due and payable and exercise any and all remedies available to it under this Agreement, the Notes and the Pledge Agreement; provided that in the case of any of the events specified in Section 13(g), without any notice, the outstanding principal amount of all Notes issued hereunder (together with any accrued and unpaid interest thereon) shall become immediately due and payable without presentment, demand for payment, protest, notice of nonpayment or other notice of any kind, all of which are hereby waived by the Issuer. Notwithstanding the foregoing, if the outstanding principal amount of any Note so becomes due and payable prior to the Exchange Date for such Notes, then the Issuer shall satisfy its obligation to pay the principal thereof by delivering the Exchange Shares for such Note (or cash in lieu of fractional Shares) to the Purchaser as provided in Section 7 as if the date the outstanding principal amount of the Note so becomes due and payable were the Exchange Date and the Purchaser elected to exercise the exchange right described in Section 7, and the provisions of Section 7 shall apply to such delivery and any Shares so delivered shall be considered Exchange Shares for all purposes under the Transaction Documents. (b) Except as expressly set forth herein, upon payment of (i) the outstanding principal amount (including, if applicable, by delivery of Exchange Shares as provided in paragraph (a) above) and accrued and unpaid interest on any Note so declared due and payable and (ii) any overdue interest thereon, all of the Issuer's obligations in respect of the payment of the principal of and interest on such Note shall terminate. (c) Upon the occurrence and during the continuance of any Event of Default, the Purchaser is hereby authorized at any time and from time to time, to the fullest extent permitted by law, to, and the Issuer agrees that the Purchaser shall have the right to, (i) set-off and apply any and all deposits (general or 22 special, time or demand, provisional or final) at any time held and other indebtedness at any time owing by the Purchaser to or for the credit or the account of the Issuer against any and all of the obligations of the Issuer now or hereafter existing under this Agreement and the Notes held by the Purchaser, and (ii) set-off any obligation that the Purchaser or any affiliate of the Purchaser may have to the Issuer against any right the Purchaser or any of its affiliates may have against the Issuer, in each case irrespective of whether or not the Purchaser shall have made any demand under this Agreement or the Notes or any such agreement and although such obligations may be unmatured. In the case of a set-off of any obligation to release, deliver or pay assets against any right to receive assets of the same type, such obligation and right shall be set-off in kind. In the case of a set-off of any obligation to release, deliver or pay assets against any right to receive assets of any other type, the value of each of such obligation and such right shall be determined by the Calculation Agent and the result of such set-off shall be that the net obligor shall pay or deliver to the other party an amount of cash or assets, at the net obligor's option, with a value (determined, in the case of a delivery of assets, by the Calculation Agent) equal to that of the net obligation. In determining the value of any obligation to release or deliver any securities or right to receive any securities, the value at any time of such obligation or right shall be determined by reference to the market value of such securities at such time. If an obligation or right is unascertained at the time of any such set-off, the Calculation Agent may in good faith estimate the amount or value of such obligation or right, in which case set-off will be effected in respect of that estimate, and the relevant party shall account to the other party at the time such obligation or right is ascertained. The rights of the Purchaser under this Section 14(c) are in addition to other rights and remedies (including, without limitation, other rights of set-off) that the Purchaser may have as a matter of law, pursuant to contract or otherwise. SECTION 15. Indemnity. In the event that the Purchaser or any of its affiliates becomes involved in any capacity in any action, proceeding or investigation brought by or against any person in connection with any matter referred to in this Agreement, the Notes, the Pledge Agreement or any other Transaction Document, the Issuer shall reimburse the Purchaser or such affiliate for its reasonable legal and other out-of-pocket expenses (including the cost of any investigation and preparation) incurred in connection therewith within 30 days of receipt of notice of such expenses, and shall indemnify and hold the Purchaser or such affiliate harmless against any losses, claims, damages or liabilities to which the Purchaser or such affiliate may become subject in connection with any such action, proceeding or investigation. Notwithstanding the foregoing, such obligation to hold harmless shall not apply to any action, proceeding, or investigation that is judicially determined as having resulted from the Purchaser's gross negligence, willful misconduct, or breach of this Agreement or such other Transaction Document. The reimbursement and indemnity obligations of the Issuer under this Section shall be in addition to any liability that the Issuer may otherwise have, shall extend upon the same terms 23 and conditions to the partners, directors, officers, agents, employees and controlling persons (if any), as the case may be, of the Purchaser and its affiliates and shall be binding upon and inure to the benefit of any successors, assigns, heirs and personal representatives of the Issuer, the Purchaser, any such affiliate and any such person. The Issuer also agrees that neither the Purchaser nor any of such affiliates, partners, directors, officers, agents, employees or controlling persons shall have any liability to the Issuer for or in connection with any matter referred to in this Agreement, the Notes, the Pledge Agreement or any other Transaction Document except to the extent that any losses, claims, damages, liabilities or expenses incurred by the Issuer result from the gross negligence, willful misconduct or bad faith of the Purchaser or a breach by the Purchaser of any of its covenants or obligations hereunder or thereunder. The foregoing provisions shall survive any termination or completion of this Agreement. For the avoidance of doubt, Section 15 of the Previous Agreement shall survive the cancellation of the Previous Notes. SECTION 16. Note Register. (a) The Issuer shall cause to be kept a note register (the "NOTE REGISTER") for the Notes in which, subject to such reasonable regulations as it may prescribe, the Issuer shall provide for the registration of the Notes and the registration of transfers of the Notes. The Issuer shall initially be the note registrar (in such capacity, the "NOTE REGISTRAR") for the purpose of registering the Notes and transfers of Notes as herein provided and may appoint a successor to itself, subject to the last sentence of this Section 16(a). Upon any resignation of any Note Registrar, the Issuer shall promptly appoint a successor or, if it elects not to make such an appointment, assume the duties of the Note Registrar. If a person other than the Issuer is appointed as Note Registrar, the Issuer will give the Purchaser prompt written notice of the appointment of such Note Registrar and of the location, and any change in the location of the Note Register. (b) Upon surrender for registration of transfer of any certificate representing any Note at an office or agency of the Issuer where the principal of and interest on the Notes are payable, the Issuer shall execute, and the Purchaser shall obtain from the Issuer, in the name of the designated transferee or transferees, one or more new certificates of a like aggregate principal amount. (c) At the option of the Purchaser, certificates with respect to any Notes may be exchanged for other certificates of a like aggregate principal amount, upon surrender of the certificates to be exchanged at the office or agency of the Issuer where the principal of and interest on the Notes are payable. (d) All Notes issued upon any registration of transfer or exchange of Notes shall be the valid obligations of the Issuer, evidencing the same debt, and entitled to the same benefits under this Agreement, as the Notes surrendered upon such registration of transfer or exchange. 24 (e) No service charge shall be made by the Issuer for any registration of transfer or exchange of any Note, but the Issuer may require payment of a sum sufficient to cover any tax or other governmental charge that may be imposed in connection with any registration of transfer or exchange of Notes. SECTION 17. Mutilated, Destroyed, Lost or Stolen Notes. (a) If (i) any mutilated Note is surrendered to the Issuer, or the Issuer receives evidence to its satisfaction of the destruction, loss or theft of any Note, and (ii) there is delivered to the Issuer such security or indemnity as may be reasonably required by it to hold the Issuer harmless, then, in the absence of notice to the Issuer or the Note Registrar that such Note has been acquired by a bona fide purchaser, the Issuer shall execute and deliver, in exchange for or in lieu of any such mutilated, destroyed, lost or stolen Note, a replacement Note of a like aggregate principal amount; provided, however, that if Notes represented by any such destroyed, lost or stolen certificate, but not a mutilated certificate, shall have become or within seven days shall be due and payable, instead of issuing a replacement certificate, the Issuer may pay to the holder of such destroyed, lost or stolen Note the amount due when so due or payable without surrender thereof. (b) Any duplicate Note issued pursuant to this Section 17 in replacement for any mutilated, destroyed, lost or stolen Note shall constitute an original additional contractual obligation of the Issuer, whether or not the mutilated, destroyed, lost or stolen Note shall be found at any time or be enforced by any person, and shall be entitled to all the benefits of this Agreement equally and proportionately with any and all other Notes duly issued hereunder. SECTION 18. Successors and Assigns. (a) This Agreement and any Note issued hereunder shall inure to the benefit of, and be binding upon, the Issuer and the Purchaser and their respective successors and assigns. Nothing expressed or mentioned in this Agreement is intended or shall be construed to give any other person, firm or corporation any legal or equitable right, remedy or claim under or in respect of this Agreement or any provision herein contained. (b) Following any transfer of any Note pursuant to Section 11(a), unless the context otherwise requires, with respect to such Note, all references in this Agreement to the "Purchaser" shall be deemed to be references to the transferee of such Note and, without limiting the foregoing, the transferee shall deliver to the Issuer on or prior to the date on which the transfer takes place, any form contemplated by Section 6(c) of this Agreement. SECTION 19. Notices. All notices and other communications hereunder shall be in writing and shall be deemed to have been duly given if mailed or transmitted by any standard form of telecommunication. Notices to the Purchaser shall be given to it at 9 West 57th Street, 40th Floor, New York, NY 10019; Telecopy No. 212-847-5124; Attention: Glen Rae. Notices to the Issuer 25 shall be given to it at 5205 North O'Connor Blvd., Irving, TX 75039; Telecopy No. 972-831-6368; Attention: John Cassil, President. Notices to the Guarantor shall be given to it at 95 Wellington Street West, Suite 800, Toronto, Ontario, M5J 2N7; Telecopy No. 416-367-2201; Attention: Bradley P. Martin, Vice President and Secretary. SECTION 20. Counterparts. This Agreement may be signed in counterparts, each of which shall be an original and all of which together shall constitute one and the same instrument. SECTION 21. Governing Law; Jurisdiction; Service Of Process. (a) THIS AGREEMENT AND ANY OTHER TRANSACTION DOCUMENT SHALL BE CONSTRUED IN ACCORDANCE WITH AND GOVERNED BY THE LAW OF THE STATE OF NEW YORK, WITHOUT GIVING EFFECT TO THE CONFLICTS OF LAWS PROVISIONS THEREOF. (b) Each of the parties hereto hereby irrevocably and unconditionally submits, for itself and its property, to the nonexclusive jurisdiction of the Supreme Court of the State of New York sitting in New York County and of the United States District Court for the Southern District of New York, and any relevant appellate court, in any action or proceeding arising out of or relating to any Transaction Document, or for recognition or enforcement of any judgment, and each party hereto hereby irrevocably and unconditionally agrees that all claims in respect of any such action or proceeding may be heard and determined in New York State court or, to the extent permitted by law, in such Federal court. Each party hereto agrees that a final judgment in any such action or proceeding shall be conclusive and may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law. Nothing in this Agreement shall affect any right that the Purchaser may otherwise have to bring any action or proceeding relating to any Transaction Document against the Issuer or the Guarantor or its properties in the courts of any jurisdiction. (c) Each party hereto irrevocably and unconditionally waives, to the fullest extent it may legally and effectively do so, any objection that it may now or hereafter have to the laying of venue of any suit, action or proceeding arising out of or relating to any Transaction Document in any court referred to in subsection (b) of this Section. Each party hereto irrevocably waives, to the fullest extent permitted by law, the defense of an inconvenient forum to the maintenance of any such suit, action or proceeding in any such court. (d) Each party hereto irrevocably consents to service of process in the manner provided in Section 19. Nothing in any Transaction Document will affect the right of any party hereto to serve process in any other manner permitted by law. 26 SECTION 22. Calculation Agent. All calculations and determinations under any Transaction Document shall be made by the Calculation Agent in good faith in a commercially reasonable manner. SECTION 23. Integration; Amendments and Waivers. (a) Except as provided herein, this Agreement and the Notes constitute the complete agreement between the parties with respect to the subject matter hereof and thereof, supersede any previous agreement or understanding between them relating hereto or thereto and may not be modified, altered or amended except as provided therein. (b) No amendment or waiver of any provision of this Agreement or any Note, nor consent to any departure by the Issuer therefrom, shall in any event be effective unless the same shall be in writing and signed by the Issuer and the Purchaser. SECTION 24. No Waiver by the Purchaser. The Purchaser's failure, at any time or times, to require strict performance by the Issuer of any provision of this Agreement or any Note shall not waive, affect or diminish any right of the Purchaser thereafter to demand strict compliance and performance herewith or therewith. Any suspension or waiver by the Purchaser of an Event of Default under this Agreement shall not suspend, waive or affect any other default or event of default by the Issuer under this Agreement or any Note whether the same is prior or subsequent thereto and whether of the same or of a different type. None of the undertakings, agreements, warranties, covenants and representations of the Issuer contained in this Agreement or any Note and no Event of Default under this Agreement shall be deemed to have been suspended or waived by the Purchaser unless such suspension or waiver is by an instrument in writing signed by an officer of the Purchaser and directed to the Issuer specifying such suspension or waiver. SECTION 25. Waiver of Jury Trial. The parties hereto waive all right to trial by jury in any action or proceeding to enforce or defend any rights under this Agreement or the Notes. SECTION 26. Severability. Wherever possible, each provision of this Agreement shall be interpreted in such manner as to be effective and valid under applicable law, but if any provision of this Agreement shall be prohibited by or invalid under applicable law, such provision shall be ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of such provision or the remaining provisions of this Agreement. SECTION 27. Survival. The representations and warranties of the Issuer and the Purchaser in this Agreement shall survive the execution, delivery and acceptance hereof by the parties hereto and the closing of the transactions described herein or related hereto. 27 SECTION 28. Matters Relating To The Agent. Each party agrees that the Agent, in its capacity as such (as distinguished from Banc of America Securities LLC, in its capacity as Calculation Agent) (i) acts as agent only, (ii) is not acting as a principal with respect to any Transaction Document and (iii) shall have no responsibility or liability (including without limitation, by way of guarantee, endorsement or otherwise) to any party in respect of any Transaction Document, including without limitation, in respect of the failure of a party to pay or perform under any Transaction Document. The Issuer hereby agrees that it will not proceed against the Agent in respect of any obligation owed to it under any Transaction Document. SECTION 29. Judgment Currency. If, for the purpose of obtaining judgment in any court, it is necessary to convert a sum due hereunder in U.S. dollars into another currency, the parties hereto agree, to the fullest extent that they may legally and effectively do so, that the rate of exchange used shall be that at which in accordance with normal banking procedures the Purchaser could purchase U.S. dollars with such other currency in New York, New York, on the business day immediately preceding the day on which final judgment is given. The obligation of the Guarantor in respect of any sum due to the Purchaser hereunder in U.S. dollars shall, to the extent permitted by applicable law, notwithstanding any judgment in a currency other than U.S. dollars, be discharged only to the extent that on the Business Day following receipt of any sum adjudged to be so due in the judgment currency the Purchaser may in accordance with normal banking procedures purchase and transfer U.S. dollars in the amount originally due to the Purchaser with the judgment currency. If the amount of U.S. dollars so purchased is less than the sum originally due to the Purchaser, the Guarantor agrees, as a separate obligation and notwithstanding any such judgment, to indemnify the Purchaser against the resulting loss; and if the amount of U.S. dollars so purchased is greater than the sum originally due to the Purchaser, the Purchaser agrees to repay such excess. SECTION 30. Guarantee. (a) The Guarantor hereby unconditionally guarantees the full and punctual payment or performance (whether at stated maturity, upon acceleration, upon exchange or otherwise) of each Guaranteed Obligation. Upon failure by the Issuer to pay or perform punctually any Guaranteed Obligation, the Guarantor shall forthwith on demand pay the amount not so paid or make the performance not so made at the place and in the manner specified in the instrument evidencing such Guaranteed Obligation. (b) The obligations of the Guarantor hereunder shall be unconditional and absolute and, without limiting the generality of the foregoing, shall not be released, discharged or otherwise affected by: 28 (i) any extension, renewal, settlement, compromise, waiver or release in respect of any obligation of the Issuer under the Notes, by operation of law or otherwise; (ii) any modification or amendment of or supplement to the Notes; (iii) any release, impairment, non-perfection or invalidity of any direct or indirect security for any obligation of the Issuer under the Notes; (iv) any change in the limited liability company existence, structure or ownership of the Issuer, or any insolvency, bankruptcy, reorganization or other similar proceeding affecting the Issuer or its assets or any resulting release or discharge of any obligation of the Issuer contained in the Notes; (v) the existence of any claim, set-off or other rights which the Guarantor may have at any time against the Issuer, the Purchaser or any other entity, whether in connection herewith or with any unrelated transactions, provided that nothing herein shall prevent the assertion of any such claim by separate suit or compulsory counterclaim; (vi) any invalidity or unenforceability relating to or against the Issuer for any reason of the Notes or any provision of applicable law or regulation purporting to prohibit the payment by the Issuer of any amounts payable under the Notes; or (vii) any other act or omission to act or delay of any kind by the Issuer, the Purchaser or any other person or any other circumstance whatsoever which might, but for the provisions of this paragraph, constitute a legal or equitable discharge of or defense to the Guarantor's obligations hereunder. (c) The Guarantor shall be liable under this guarantee only for amounts aggregating up to the largest amount that would not render its obligations hereunder subject to avoidance under Section 548 of the United States Bankruptcy Code or any comparable provision of any other applicable law. (d) The Guarantor's obligations hereunder shall remain in full force and effect until all Guaranteed Obligations shall have been paid or performed in full. If at any time any payment of any Guaranteed Obligation is rescinded or must be otherwise restored or returned upon the insolvency, bankruptcy or reorganization of the Guarantor or otherwise, the Guarantor's obligations hereunder with respect to such payment shall be reinstated as though such payment had been due but not made at such time. 29 (e) The Guarantor irrevocably waives acceptance hereof, presentment, demand, protest and any notice not provided for herein, as well as any requirement that at any time any action be taken by any person or entity against the Guarantor, the Issuer or any other person or entity. (f) Upon making full payment or performance with respect to any obligation of the Issuer hereunder, the Guarantor shall be subrogated to the rights of the payee or recipient against the Issuer with respect to such obligation; provided that the Guarantor shall not enforce any payment by way of subrogation so long as any Guaranteed Obligation remains unpaid or unperformed. (g) If acceleration of the time for payment or performance of any Guaranteed Obligation is stayed upon the insolvency, bankruptcy or reorganization of the Issuer, all such Guaranteed Obligations otherwise subject to acceleration under the terms of the Notes shall nonetheless be payable or performable by the Guarantor hereunder forthwith on demand by the Purchaser. (h) No failure or delay by the Purchaser in exercising any right, power or privilege under this Guarantee or the Notes shall operate as a waiver thereof nor shall any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any other right, power or privilege. (i) This Guarantee shall be binding upon the Guarantor and its successors and assigns, for the benefit of the Purchaser and its successors and assigns, except that the Guarantor may not transfer or assign any or all of its rights or obligations hereunder without the prior written consent of the Purchaser. 30 IN WITNESS WHEREOF, this Agreement has been executed as of the date first written above. ISSUER: FAIRFAX FINANCIAL (US) LLC By: /s/ John Cassil --------------------------------- Name: John Cassil Title: President GUARANTOR: FAIRFAX FINANCIAL HOLDINGS LIMITED By: /s/ Paul Rivett --------------------------------- Name: Paul Rivett Title: Vice President PURCHASER: NMS SERVICES (CAYMAN) INC. By: /s/ Eric P. Hambleton --------------------------------- Name: Eric P. Hambleton Title: Authorized Signatory AGENT: BANC OF AMERICA SECURITIES LLC By: /s/ Robert Kevin Beauregard --------------------------------- Name: Robert Kevin Beauregard Title: Managing Director EXHIBIT A [FORM OF NOTE PURCHASE CONFIRMATION] NOTE PURCHASE CONFIRMATION No.__ The purpose of this letter (this "NOTE PURCHASE CONFIRMATION") is to confirm the terms of the Note to be issued and sold by Fairfax Financial (US) LLC, a Delaware limited liability company (the "ISSUER") to NMS Services (Cayman) Inc. (the "PURCHASER") on the Issue Date specified below pursuant to the Master Note Purchase Agreement (as amended, replaced, restated, extended, supplemented or otherwise modified from time to time, the "MASTER NOTE PURCHASE AGREEMENT") dated as of November 19, 2004 among the Issuer, the Purchaser, Fairfax Financial Holdings Limited (the "GUARANTOR") and Banc of America Securities LLC (the "AGENT"). Capitalized terms used and not otherwise defined herein shall have the meanings ascribed to them in the Master Note Purchase Agreement. This Note Purchase Confirmation constitutes a "Note Purchase Confirmation" as referred to in the Master Note Purchase Agreement. This Note Purchase Confirmation supplements, forms a part of, and is subject to, the Master Note Purchase Agreement. All provisions contained in the Master Note Purchase Agreement govern this Note Purchase Confirmation except as expressly modified below. The terms of the Note to which this Note Purchase Confirmation relates are as follows: Principal Amount: USD_____________________________ Purchase Consideration: ________________________________ Issue Date: __________________________, 200_ Maturity Date: __________________________, 200_ Interest Rate: __% Prepaid Interest Amount: USD_____________________________ Interest Payment Date: __________, __________, __________ and __________ of each year, commencing with __________, and ending on the Maturity Date, or if any such day is not a Business Day, the first A-1 following day that is a Business Day unless that day falls in another calendar month, in which case that date will be the first preceding day that is a Business Day Exchange Period: The period from and including ____ __, 200_ through and including ____, 200_ Exchange Price: USD__________________ A-2 IN WITNESS WHEREOF, the parties have signed this Confirmation as of this ___ day of ________, 200_. ISSUER: FAIRFAX FINANCIAL (US) LLC By:________________________________ Name: Title: GUARANTOR: FAIRFAX FINANCIAL HOLDINGS LIMITED By:________________________________ Name: Title: PURCHASER: NMS SERVICES (CAYMAN) INC. By:________________________________ Name: Title: AGENT: BANC OF AMERICA SECURITIES LLC By:________________________________ Name: Title: A-3 EXHIBIT B [FORM OF NOTE] USD_______ PROMISSORY NOTE Note No.____________ Issue Date:________ __, 200_ FOR VALUE RECEIVED, Fairfax Financial (US) LLC, a Delaware limited liability company (the "COMPANY"), hereby promises to pay to the order of NMS Services (Cayman) Inc. or registered assigns (the "NOTEHOLDER"), on ________ __, 200_, or if such day is not a Business Day (as defined in the Master Note Purchase Agreement referred to below), the first following day that is a Business Day unless that day falls in another calendar month, in which case that date will be the first preceding day that is a Business Day (the "MATURITY DATE"), the principal amount of USD _______ (______________________________ U.S. DOLLARS) under that certain Master Note Purchase Agreement dated as of November 19, 2004, among the Company, NMS Services (Cayman) Inc., Fairfax Financial Holdings Limited, as Guarantor (the "GUARANTOR") and Banc of America Securities LLC, as Agent (the "AGENT"), as amended, replaced, restated, extended, supplemented or otherwise modified from time to time (the "MASTER NOTE PURCHASE AGREEMENT"). The Company promises to pay interest on the principal amount hereof from the Issue Date stated above until such principal amount is paid in full, at such interest rates, at such times and in such manner as are specified in the Master Note Purchase Agreement and the Note Purchase Confirmation referred to below. If any amount is not paid in full when due hereunder, such unpaid amount shall bear interest, to be paid upon demand, from the due date thereof until the date of actual payment (and before as well as after judgment) computed at the rate set forth in the Master Note Purchase Agreement. This Note is one of the Notes issued pursuant to a Note Purchase Confirmation dated as of _______, __, 200_, as amended from time to time (the "NOTE PURCHASE CONFIRMATION"), under the Master Note Purchase Agreement, and is entitled to the benefits thereof. This Note is secured by collateral pursuant to the Pledge Agreement dated as of November 19, 2004, among the Company, the Noteholder and the Agent, as amended from time to time, until and including the Pledge Termination Date as defined therein. Upon the occurrence of one or more of the Events of Default specified in the Master Note Purchase Agreement, all amounts then remaining unpaid on this Note shall become, or may be declared to be, immediately due and payable all as provided in the Master Note Purchase Agreement. This Note is entitled to the benefits of the guarantee of the Guarantor contained in the Master Note Purchase Agreement. B-1 This Note is exchangeable into the shares of common stock of Odyssey Re Holdings Corp. on the terms set forth in the Master Note Purchase Agreement. The Company, for itself and its successors and assigns, hereby waives diligence, presentment, protest and demand and notice of protest, demand, dishonor and non-payment of this Note. This Note shall be governed by and construed in accordance with the laws of the State of New York, without giving effect to the conflict of laws provisions thereof. COMPANY: FAIRFAX FINANCIAL (US) LLC By:___________________________ Name: Title: GUARANTOR: FAIRFAX FINANCIAL HOLDINGS LIMITED By:___________________________ Name: Title: B-2 EX-2.2 3 t14767exv2w2.txt EX-2.2 USD68,092,000 PROMISSORY NOTE Note No. 5 Issue Date: November 19, 2004 FOR VALUE RECEIVED, Fairfax Financial (US) LLC, a Delaware limited liability company (the "COMPANY"), hereby promises to pay to the order of Intrepid Portfolios LLC or registered assigns (the "NOTEHOLDER"), on November 19, 2009, or if any such day is not a Business Day (as defined in the Master Note Purchase Agreement referred to below), the first following day that is a Business Day unless that day falls in another calendar month, in which case that date will be the first preceding day that is a Business Day (the "MATURITY DATE"), the principal amount of USD68,092,000 (SIXTY-EIGHT MILLION, NINETY-TWO THOUSAND U.S. DOLLARS) under that certain Master Note Purchase Agreement dated as of November 19, 2004, among the Company, NMS Services (Cayman) Inc., Fairfax Financial Holdings Limited, as Guarantor (the "GUARANTOR") and Banc of America Securities LLC, as Agent (the "AGENT"), as amended, replaced, restated, extended, supplemented or otherwise modified from time to time (the "MASTER NOTE PURCHASE AGREEMENT"). The Company promises to pay interest on the principal amount hereof from the Issue Date stated above until such principal amount is paid in full, at such interest rates, at such times and in such manner as are specified in the Master Note Purchase Agreement and the Note Purchase Confirmation referred to below. If any amount is not paid in full when due hereunder, such unpaid amount shall bear interest, to be paid upon demand, from the due date thereof until the date of actual payment (and before as well as after judgment) computed at the rate set forth in the Master Note Purchase Agreement. This Note is issued pursuant to Note Purchase Confirmation No. 1 dated as of November 19, 2004, as amended from time to time (the "NOTE PURCHASE CONFIRMATION"), under the Master Note Purchase Agreement, and is entitled to the benefits thereof. This Note is secured by collateral pursuant to the Pledge Agreement dated as of November 19, 2004 among the Company, the Noteholder and the Agent, as amended from time to time, until and including the Pledge Termination Date as defined therein. Upon the occurrence of one or more of the Events of Default specified in the Master Note Purchase Agreement, all amounts then remaining unpaid on this Note shall become, or may be declared to be, immediately due and payable all as provided in the Master Note Purchase Agreement. This Note is entitled to the benefits of the guarantee of the Guarantor contained in the Master Note Purchase Agreement. This Note is exchangeable into the shares of common stock of Odyssey Re Holdings Corp. on the terms set forth in the Master Note Purchase Agreement. The Company, for itself and its successors and assigns, hereby waives diligence, presentment, protest and demand and notice of protest, demand, dishonor and non-payment of this Note. This Note shall be governed by and construed in accordance with the laws of the State of New York, without giving effect to the conflict of laws provisions thereof. COMPANY: FAIRFAX FINANCIAL (US) LLC By: /s/ John Cassil -------------------------------- Name: John Cassil Title: President GUARANTOR: FAIRFAX FINANCIAL HOLDINGS LIMITED By: /s/ Paul Rivett -------------------------------- Name: Paul Rivett Title: Vice President EX-2.3 4 t14767exv2w3.txt EX-2.3 USD11,740,000 PROMISSORY NOTE Note No. 6 Issue Date: November 19, 2004 FOR VALUE RECEIVED, Fairfax Financial (US) LLC, a Delaware limited liability company (the "COMPANY"), hereby promises to pay to the order of Intrepid Portfolios LLC or registered assigns (the "NOTEHOLDER"), on November 19, 2009, or if any such day is not a Business Day (as defined in the Master Note Purchase Agreement referred to below), the first following day that is a Business Day unless that day falls in another calendar month, in which case that date will be the first preceding day that is a Business Day (the "MATURITY DATE"), the principal amount of USD11,740,000 (ELEVEN MILLION, SEVEN HUNDRED FORTY THOUSAND U.S. DOLLARS) under that certain Master Note Purchase Agreement dated as of November 19, 2004, among the Company, NMS Services (Cayman) Inc., Fairfax Financial Holdings Limited, as Guarantor (the "GUARANTOR") and Banc of America Securities LLC, as Agent (the "AGENT"), as amended, replaced, restated, extended, supplemented or otherwise modified from time to time (the "MASTER NOTE PURCHASE AGREEMENT"). The Company promises to pay interest on the principal amount hereof from the Issue Date stated above until such principal amount is paid in full, at such interest rates, at such times and in such manner as are specified in the Master Note Purchase Agreement and the Note Purchase Confirmation referred to below. If any amount is not paid in full when due hereunder, such unpaid amount shall bear interest, to be paid upon demand, from the due date thereof until the date of actual payment (and before as well as after judgment) computed at the rate set forth in the Master Note Purchase Agreement. This Note is issued pursuant to Note Purchase Confirmation No. 2 dated as of November 19, 2004, as amended from time to time (the "NOTE PURCHASE CONFIRMATION"), under the Master Note Purchase Agreement, and is entitled to the benefits thereof. This Note is secured by collateral pursuant to the Pledge Agreement dated as of November 19, 2004 among the Company, the Noteholder and the Agent, as amended from time to time, until and including the Pledge Termination Date as defined therein. Upon the occurrence of one or more of the Events of Default specified in the Master Note Purchase Agreement, all amounts then remaining unpaid on this Note shall become, or may be declared to be, immediately due and payable all as provided in the Master Note Purchase Agreement. This Note is entitled to the benefits of the guarantee of the Guarantor contained in the Master Note Purchase Agreement. This Note is exchangeable into the shares of common stock of Odyssey Re Holdings Corp. on the terms set forth in the Master Note Purchase Agreement. The Company, for itself and its successors and assigns, hereby waives diligence, presentment, protest and demand and notice of protest, demand, dishonor and non-payment of this Note. This Note shall be governed by and construed in accordance with the laws of the State of New York, without giving effect to the conflict of laws provisions thereof. COMPANY: FAIRFAX FINANCIAL (US) LLC By: /s/ John Cassil -------------------------------- Name: John Cassil Title: President GUARANTOR: FAIRFAX FINANCIAL HOLDINGS LIMITED By: /s/ Paul Rivett -------------------------------- Name: Paul Rivett Title: Vice President EX-2.4 5 t14767exv2w4.txt EX-2.4 USD11,740,000 PROMISSORY NOTE Note No. 7 Issue Date: November 19, 2004 FOR VALUE RECEIVED, Fairfax Financial (US) LLC, a Delaware limited liability company (the "COMPANY"), hereby promises to pay to the order of Intrepid Portfolios LLC or registered assigns (the "NOTEHOLDER"), on November 19, 2009, or if any such day is not a Business Day (as defined in the Master Note Purchase Agreement referred to below), the first following day that is a Business Day unless that day falls in another calendar month, in which case that date will be the first preceding day that is a Business Day (the "MATURITY DATE"), the principal amount of USD11,740,000 (ELEVEN MILLION, SEVEN HUNDRED FORTY THOUSAND U.S. DOLLARS) under that certain Master Note Purchase Agreement dated as of November 19, 2004, among the Company, NMS Services (Cayman) Inc., Fairfax Financial Holdings Limited, as Guarantor (the "GUARANTOR") and Banc of America Securities LLC, as Agent (the "AGENT"), as amended, replaced, restated, extended, supplemented or otherwise modified from time to time (the "MASTER NOTE PURCHASE AGREEMENT"). The Company promises to pay interest on the principal amount hereof from the Issue Date stated above until such principal amount is paid in full, at such interest rates, at such times and in such manner as are specified in the Master Note Purchase Agreement and the Note Purchase Confirmation referred to below. If any amount is not paid in full when due hereunder, such unpaid amount shall bear interest, to be paid upon demand, from the due date thereof until the date of actual payment (and before as well as after judgment) computed at the rate set forth in the Master Note Purchase Agreement. This Note is issued pursuant to Note Purchase Confirmation No. 3 dated as of November 19, 2004, as amended from time to time (the "NOTE PURCHASE CONFIRMATION"), under the Master Note Purchase Agreement, and is entitled to the benefits thereof. This Note is secured by collateral pursuant to the Pledge Agreement dated as of November 19, 2004 among the Company, the Noteholder and the Agent, as amended from time to time, until and including the Pledge Termination Date as defined therein. Upon the occurrence of one or more of the Events of Default specified in the Master Note Purchase Agreement, all amounts then remaining unpaid on this Note shall become, or may be declared to be, immediately due and payable all as provided in the Master Note Purchase Agreement. This Note is entitled to the benefits of the guarantee of the Guarantor contained in the Master Note Purchase Agreement. This Note is exchangeable into the shares of common stock of Odyssey Re Holdings Corp. on the terms set forth in the Master Note Purchase Agreement. The Company, for itself and its successors and assigns, hereby waives diligence, presentment, protest and demand and notice of protest, demand, dishonor and non-payment of this Note. This Note shall be governed by and construed in accordance with the laws of the State of New York, without giving effect to the conflict of laws provisions thereof. COMPANY: FAIRFAX FINANCIAL (US) LLC By: /s/ John Cassil -------------------------------- Name: John Cassil Title: President GUARANTOR: FAIRFAX FINANCIAL HOLDINGS LIMITED By: /s/ Paul Rivett -------------------------------- Name: Paul Rivett Title: Vice President EX-2.5 6 t14767exv2w5.txt EX-2.5 USD9,392,000 PROMISSORY NOTE Note No. 8 Issue Date: November 19, 2004 FOR VALUE RECEIVED, Fairfax Financial (US) LLC, a Delaware limited liability company (the "COMPANY"), hereby promises to pay to the order of Intrepid Portfolios LLC or registered assigns (the "NOTEHOLDER"), on November 19, 2009, or if any such day is not a Business Day (as defined in the Master Note Purchase Agreement referred to below), the first following day that is a Business Day unless that day falls in another calendar month, in which case that date will be the first preceding day that is a Business Day (the "MATURITY DATE"), the principal amount of USD9,392,000 (NINE MILLION, THREE HUNDRED NINETY-TWO THOUSAND U.S. DOLLARS) under that certain Master Note Purchase Agreement dated as of November 19, 2004, among the Company, NMS Services (Cayman) Inc., Fairfax Financial Holdings Limited, as Guarantor (the "GUARANTOR") and Banc of America Securities LLC, as Agent (the "AGENT"), as amended, replaced, restated, extended, supplemented or otherwise modified from time to time (the "MASTER NOTE PURCHASE AGREEMENT"). The Company promises to pay interest on the principal amount hereof from the Issue Date stated above until such principal amount is paid in full, at such interest rates, at such times and in such manner as are specified in the Master Note Purchase Agreement and the Note Purchase Confirmation referred to below. If any amount is not paid in full when due hereunder, such unpaid amount shall bear interest, to be paid upon demand, from the due date thereof until the date of actual payment (and before as well as after judgment) computed at the rate set forth in the Master Note Purchase Agreement. This Note is issued pursuant to Note Purchase Confirmation No. 4 dated as of November 19, 2004, as amended from time to time (the "NOTE PURCHASE CONFIRMATION"), under the Master Note Purchase Agreement, and is entitled to the benefits thereof. This Note is secured by collateral pursuant to the Pledge Agreement dated as of November 19, 2004 among the Company, the Noteholder and the Agent, as amended from time to time, until and including the Pledge Termination Date as defined therein. Upon the occurrence of one or more of the Events of Default specified in the Master Note Purchase Agreement, all amounts then remaining unpaid on this Note shall become, or may be declared to be, immediately due and payable all as provided in the Master Note Purchase Agreement. This Note is entitled to the benefits of the guarantee of the Guarantor contained in the Master Note Purchase Agreement. This Note is exchangeable into the shares of common stock of Odyssey Re Holdings Corp. on the terms set forth in the Master Note Purchase Agreement. The Company, for itself and its successors and assigns, hereby waives diligence, presentment, protest and demand and notice of protest, demand, dishonor and non-payment of this Note. This Note shall be governed by and construed in accordance with the laws of the State of New York, without giving effect to the conflict of laws provisions thereof. COMPANY: FAIRFAX FINANCIAL (US) LLC By: /s/ John Cassil -------------------------------- Name: John Cassil Title: President GUARANTOR: FAIRFAX FINANCIAL HOLDINGS LIMITED By: /s/ Paul Rivett -------------------------------- Name: Paul Rivett Title: Vice President EX-2.6 7 t14767exv2w6.txt EX-2.6 NOTE PURCHASE CONFIRMATION No. 1 The purpose of this letter (this "NOTE PURCHASE CONFIRMATION") is to confirm the terms of the Note to be issued and sold by Fairfax Financial (US) LLC, a Delaware limited liability company (the "ISSUER") to NMS Services (Cayman) Inc. (the "PURCHASER") on the Issue Date specified below pursuant to the Master Note Purchase Agreement (as amended, replaced, restated, extended, supplemented or otherwise modified from time to time, the "MASTER NOTE PURCHASE AGREEMENT") dated as of November 19, 2004 among the Issuer, the Purchaser, Fairfax Financial Holdings Limited (the "GUARANTOR") and Banc of America Securities LLC (the "AGENT"). Capitalized terms used and not otherwise defined herein shall have the meanings ascribed to them in the Master Note Purchase Agreement. This Note Purchase Confirmation constitutes a "Note Purchase Confirmation" as referred to in the Master Note Purchase Agreement. This Note Purchase Confirmation supplements, forms a part of, and is subject to, the Master Note Purchase Agreement. All provisions contained in the Master Note Purchase Agreement govern this Note Purchase Confirmation except as expressly modified below. The terms of the Note to which this Note Purchase Confirmation relates are as follows: Principal Amount: USD68,092,000 Purchase Consideration: Cancellation of Previous Note No. 1 and USD13,612,500 principal amount of Previous Note No. 2 Issue Date: November 19, 2004 Maturity Date: November 19, 2009 Interest Rate: 3.15% Prepaid Interest Amount: USD4,145,543 Interest Payment Date: November 19, February 19, May 19 and August 19 of each year, commencing February 19, 2005, and ending on the Maturity Date, or if any such day is not a Business Day, the first following day that is a Business Day unless that day falls in another calendar month, in which case that date will be the first preceding day that is a Business Day Exchange Period: The period beginning on and including November 3, 2006, through and including November 17, 2006 Exchange Price: USD23.48 IN WITNESS WHEREOF, the parties have signed this Confirmation as of this 19th day of November, 2004. ISSUER: FAIRFAX FINANCIAL (US) LLC By: /s/ John Cassil --------------------------------- Name: John Cassil Title: President GUARANTOR: FAIRFAX FINANCIAL HOLDINGS LIMITED By: /s/ Paul Rivett --------------------------------- Name: Paul Rivett Title: Vice President PURCHASER: NMS Services (Cayman) Inc. By: /s/ Eric P. Hambleton --------------------------------- Name: Eric P. Hambleton Title: Authorized Signatory AGENT: BANC OF AMERICA SECURITIES LLC By: /s/ Robert Kevin Beauregard --------------------------------- Name: Robert Kevin Beauregard Title: Managing Director EX-2.7 8 t14767exv2w7.txt EX-2.7 NOTE PURCHASE CONFIRMATION No. 2 The purpose of this letter (this "NOTE PURCHASE CONFIRMATION") is to confirm the terms of the Note to be issued and sold by Fairfax Financial (US) LLC, a Delaware limited liability company (the "ISSUER") to NMS Services (Cayman) Inc. (the "PURCHASER") on the Issue Date specified below pursuant to the Master Note Purchase Agreement (as amended, replaced, restated, extended, supplemented or otherwise modified from time to time, the "MASTER NOTE PURCHASE AGREEMENT") dated as of November 19, 2004 among the Issuer, the Purchaser, Fairfax Financial Holdings Limited (the "GUARANTOR") and Banc of America Securities LLC (the "AGENT"). Capitalized terms used and not otherwise defined herein shall have the meanings ascribed to them in the Master Note Purchase Agreement. This Note Purchase Confirmation constitutes a "Note Purchase Confirmation" as referred to in the Master Note Purchase Agreement. This Note Purchase Confirmation supplements, forms a part of, and is subject to, the Master Note Purchase Agreement. All provisions contained in the Master Note Purchase Agreement govern this Note Purchase Confirmation except as expressly modified below. The terms of the Note to which this Note Purchase Confirmation relates are as follows: Principal Amount: USD11,740,000 Purchase Consideration: Cancellation of USD9,075,000 principal amount of Previous Note No. 2 Issue Date: November 19, 2004 Maturity Date: November 19, 2009 Interest Rate: 3.15% Prepaid Interest Amount: USD628,362 Interest Payment Date: November 19, February 19, May 19, and August 19 of each year, commencing February 19, 2005, and ending on the Maturity Date, or if any such day is not a Business Day, the first following day that is a Business Day unless that day falls in another calendar month, in which case that date will be the first preceding day that is a Business Day Exchange Period: The period beginning on and including August 4, 2006 through and including August 18, 2006 Exchange Price: USD23.48 IN WITNESS WHEREOF, the parties have signed this Confirmation as of this 19th day of November, 2004. ISSUER: FAIRFAX FINANCIAL (US) LLC By: /s/ John Cassil --------------------------------- Name: John Cassil Title: President GUARANTOR: FAIRFAX FINANCIAL HOLDINGS LIMITED By: /s/ Paul Rivett --------------------------------- Name: Paul Rivett Title: Vice President PURCHASER: NMS Services (Cayman) Inc. By: /s/ Eric P. Hambleton --------------------------------- Name: Eric P. Hambleton Title: Authorized Signatory AGENT: BANC OF AMERICA SECURITIES LLC By: /s/ Robert Kevin Beauregard --------------------------------- Name: Robert Kevin Beauregard Title: Managing Director EX-2.8 9 t14767exv2w8.txt EX-2.8 NOTE PURCHASE CONFIRMATION No. 3 The purpose of this letter (this "NOTE PURCHASE CONFIRMATION") is to confirm the terms of the Note to be issued and sold by Fairfax Financial (US) LLC, a Delaware limited liability company (the "ISSUER") to NMS Services (Cayman) Inc. (the "PURCHASER") on the Issue Date specified below pursuant to the Master Note Purchase Agreement (as amended, replaced, restated, extended, supplemented or otherwise modified from time to time, the "MASTER NOTE PURCHASE AGREEMENT") dated as of November 19, 2004 among the Issuer, the Purchaser, Fairfax Financial Holdings Limited (the "GUARANTOR") and Banc of America Securities LLC (the "AGENT"). Capitalized terms used and not otherwise defined herein shall have the meanings ascribed to them in the Master Note Purchase Agreement. This Note Purchase Confirmation constitutes a "Note Purchase Confirmation" as referred to in the Master Note Purchase Agreement. This Note Purchase Confirmation supplements, forms a part of, and is subject to, the Master Note Purchase Agreement. All provisions contained in the Master Note Purchase Agreement govern this Note Purchase Confirmation except as expressly modified below. The terms of the Note to which this Note Purchase Confirmation relates are as follows: Principal Amount: USD11,740,000 Purchase Consideration: Cancellation of USD9,075,000 principal amount of Previous Note No. 2 Issue Date: November 19, 2004 Maturity Date: November 19, 2009 Interest Rate: 3.15% Prepaid Interest Amount: USD628,362 Interest Payment Date: November 19, February 19, May 19, and August 19 of each year, commencing February 19, 2005, and ending on the Maturity Date, or if any such day is not a Business Day, the first following day that is a Business Day unless that day falls in another calendar month, in which case that date will be the first preceding day that is a Business Day Exchange Period: The period beginning on and including August 4, 2006 through and including August 18, 2006 Exchange Price: USD23.48 IN WITNESS WHEREOF, the parties have signed this Confirmation as of this 19th day of November, 2004. ISSUER: FAIRFAX FINANCIAL (US) LLC By: /s/ John Cassil --------------------------------- Name: John Cassil Title: President GUARANTOR: FAIRFAX FINANCIAL HOLDINGS LIMITED By: /s/ Paul Rivett --------------------------------- Name: Paul Rivett Title: Vice President PURCHASER: NMS Services (Cayman) Inc. By: /s/ Eric P. Hambleton --------------------------------- Name: Eric P. Hambleton Title: Authorized Signatory AGENT: BANC OF AMERICA SECURITIES LLC By: /s/ Robert Kevin Beauregard --------------------------------- Name: Robert Kevin Beauregard Title: Managing Director EX-2.9 10 t14767exv2w9.txt EX-2.9 NOTE PURCHASE CONFIRMATION No. 4 The purpose of this letter (this "NOTE PURCHASE CONFIRMATION") is to confirm the terms of the Note to be issued and sold by Fairfax Financial (US) LLC, a Delaware limited liability company (the "ISSUER") to NMS Services (Cayman) Inc. (the "PURCHASER") on the Issue Date specified below pursuant to the Master Note Purchase Agreement (as amended, replaced, restated, extended, supplemented or otherwise modified from time to time, the "MASTER NOTE PURCHASE AGREEMENT") dated as of November 19, 2004 among the Issuer, the Purchaser, Fairfax Financial Holdings Limited (the "GUARANTOR") and Banc of America Securities LLC (the "AGENT"). Capitalized terms used and not otherwise defined herein shall have the meanings ascribed to them in the Master Note Purchase Agreement. This Note Purchase Confirmation constitutes a "Note Purchase Confirmation" as referred to in the Master Note Purchase Agreement. This Note Purchase Confirmation supplements, forms a part of, and is subject to, the Master Note Purchase Agreement. All provisions contained in the Master Note Purchase Agreement govern this Note Purchase Confirmation except as expressly modified below. The terms of the Note to which this Note Purchase Confirmation relates are as follows: Principal Amount: USD9,392,000 Purchase Consideration: Cancellation of USD 7,260,000 principal amount of Previous Note No. 2 Issue Date: November 19, 2004 Maturity Date: November 19, 2009 Interest Rate: 3.15% Prepaid Interest Amount: USD502,689 Interest Payment Date: November 19, February 19, May 19, and August 19 of each year, commencing February 19, 2005, and ending on the Maturity Date, or if any such day is not a Business Day, the first following day that is a Business Day unless that day falls in another calendar month, in which case that date will be the first preceding day that is a Business Day Exchange Period: The period beginning on and including August 4, 2006 through and including August 18, 2006 Exchange Price: USD23.48 IN WITNESS WHEREOF, the parties have signed this Confirmation as of this 19th day of November, 2004. ISSUER: FAIRFAX FINANCIAL (US) LLC By: /s/ John Cassil --------------------------------- Name: John Cassil Title: President GUARANTOR: FAIRFAX FINANCIAL HOLDINGS LIMITED By: /s/ Paul Rivett --------------------------------- Name: Paul Rivett Title: Vice President PURCHASER: NMS Services (Cayman) Inc. By: /s/ Eric P. Hambleton --------------------------------- Name: Eric P. Hambleton Title: Authorized Signatory AGENT: BANC OF AMERICA SECURITIES LLC By: /s/ Robert Kevin Beauregard --------------------------------- Name: Robert Kevin Beauregard Title: Managing Director EX-2.10 11 t14767exv2w10.txt EX-2.10 PLEDGE AGREEMENT [BANK OF AMERICA LOGO] EQUITY FINANCIAL PRODUCTS GROUP TABLE OF CONTENTS SECTION 1. The Security Interests SECTION 2. Definitions SECTION 3. Representations and Warranties of Pledgor SECTION 4. Certain Covenants of Pledgor SECTION 5. Administration of the Collateral and Valuation of the Securities SECTION 6. Income and Voting Rights in Collateral SECTION 7. Remedies upon Events of Default SECTION 8. Miscellaneous SECTION 9. Termination of Pledge Agreement THIS AGREEMENT is made as of the date stated on the last page hereof among the counterparty named on the last page hereof ("PLEDGOR"), NMS SERVICES (CAYMAN) INC. ("SECURED PARTY") and BANC OF AMERICA SECURITIES LLC, as Agent (the "AGENT"). WHEREAS, pursuant to the Master Note Purchase Agreement (as amended from time to time, the "NOTE PURCHASE AGREEMENT") dated as of the date hereof among Pledgor, Fairfax Financial Holdings Limited, as Guarantor, Secured Party and the Agent, Pledgor has issued notes (the "NOTES") exchangeable for shares of common stock (the "COMMON STOCK"), par value $0.01, of Odyssey Re Holdings Corp., a Delaware corporation (the "COMPANY"), to Secured Party; WHEREAS, it is a condition to the obligations of Secured Party under the Note Purchase Agreement that Pledgor, Secured Party and Agent enter into this Agreement and that Pledgor grant the pledge provided for herein as an uninterrupted continuation of the pledge provided for in the Pledge Agreement dated as of March 3, 2003 among Pledgor, Secured Party and the Agent (the "PREVIOUS PLEDGE AGREEMENT"); NOW, THEREFORE, in consideration of their mutual covenants contained herein and to secure the performance by Pledgor of its obligations under the Notes and the observance and performance of the covenants and agreements contained herein and in the Note Purchase Agreement, the parties hereto, intending to be legally bound, hereby mutually covenant and agree as follows: SECTION 1. The Security Interests. In order to secure the full and punctual observance and performance of the covenants and agreements contained herein, in the Note Purchase Agreement and under the Notes: (a) Pledgor hereby assigns and pledges to Secured Party, and grants to Secured Party, security interests having priority over all other security interests, with power of sale in and to (i) the Initial Pledged Items described in paragraph (b); (ii) all additions to and substitutions for such Initial Pledged Items (including, without limitation, any securities, instruments or other property delivered or pledged pursuant to Section 4(a) or 5(b)) (such additions and substitutions, the "ADDITIONS AND SUBSTITUTIONS"); (iii) all income, proceeds and collections received or to be received, or derived or to be derived, now or any time hereafter (whether before or after the commencement of any proceeding under applicable bankruptcy, insolvency or similar law, by or against Pledgor, with respect to Pledgor) from or in connection with the Initial Pledged Items or the Additions and Substitutions (including, without limitation, any shares of capital stock issued by the Company in respect of any Common Stock (or security entitlements in respect thereof) constituting Collateral or any cash, securities or other property distributed in respect of or exchanged for any Common Stock (or security entitlements in respect thereof) constituting Collateral, or into which any such Common Stock (or security entitlements in respect thereof) is converted, in connection with any Merger Event or otherwise, and any security entitlements in respect of any of the foregoing); (iv) the Collateral Account and all securities and other financial assets (each as defined in Section 8-102 of the UCC), including the Initial Pledged Items and the Additions and Substitutions, and other funds, property or assets from time to time held therein or credited thereto; (v) all powers and rights now owned or hereafter acquired under or with respect to the Initial Pledged Items or the Additions and Substitutions; and (vi) security entitlements in respect of any of the foregoing; provided, however, that none of the foregoing shall include any dividend or distribution on the Common Stock consisting solely of cash (such Initial Pledged Items, Additions and Substitutions, proceeds, collections, powers, rights, Collateral Account and assets held therein or credited thereto and security entitlements being herein collectively called the "COLLATERAL"). Secured Party shall have all of the rights, remedies and recourses with respect to the Collateral afforded a secured party by the UCC, in addition to, and not in limitation of, the other rights, remedies and recourses afforded to Secured Party by this Agreement. (b) On or prior to the Issue Date (as such term is defined in the Note Purchase Agreement) for any Note, Pledgor shall deliver to Secured Party in the manner described in Section 5(c) in pledge hereunder Eligible Collateral consisting of the Maximum Deliverable Number of shares of Common Stock (or security entitlements in respect thereof), in the manner provided in Section 5(c) (in respect of such Note, the "INITIAL PLEDGED ITEMS"). (c) In the event that the Company at any time issues to Pledgor in respect of any Common Stock (or security entitlements in respect thereof) constituting Collateral hereunder any additional or substitute shares of capital stock of any class (or any security entitlements in respect thereof), Pledgor shall immediately pledge and deliver to Secured Party in accordance with Section 5(c) all such shares and security entitlements as additional Collateral hereunder. (d) The Security Interests are granted as security only and shall not subject Secured Party to, or transfer or in any way affect or modify, any obligation or liability of Pledgor or the Company with respect to any of the Collateral or any transaction in connection therewith. (e) The parties hereto expressly agree that all rights, assets and property at any time held in or credited to the Collateral Account shall be treated as financial assets (as defined in Section 8-102 of the UCC). (f)The parties hereto expressly agree that the Security Interests constitute an uninterrupted continuation of the security interests granted to Secured Party on March 3, 2003 pursuant to the Previous Pledge Agreement. SECTION 2. Definitions. Capitalized terms used and not otherwise defined herein shall have the meanings ascribed to them in the Note Purchase Agreement. As used herein, the following words and phrases shall have the following meanings: "ADDITIONS AND SUBSTITUTIONS" has the meaning provided in Section 1(a). "AUTHORIZED OFFICER" of Pledgor means any officer or manager as to whom Pledgor shall have delivered notice to Secured Party that such officer or manager is authorized to act hereunder on behalf of Pledgor. "BUSINESS DAY" means any day on which commercial banks are open for business in New York City and the New York Stock Exchange is not closed. "COLLATERAL" has the meaning provided in Section 1(a). "COLLATERAL ACCOUNT" has the meaning provided in Section 5(c). "COLLATERAL EVENT OF DEFAULT" means, at any time, the occurrence of either of the following: (A) failure of the Collateral to include, as Eligible Collateral, at least the Maximum Deliverable Number of shares of Common Stock or (B) failure at any time of the Security Interests to constitute valid and perfected security interests in all of the Collateral, subject to no prior or equal Lien, and, with respect to any Collateral consisting of securities or security entitlements (each as defined in Section 8-102 of the UCC), as to which Secured Party has Control, or, in each case, assertion of such by Pledgor in writing. "CONTROL" means "control" as defined in Section 8-106 of the UCC. "DEFAULT SETTLEMENT DATE" has the meaning provided in Section 7(a). "ELIGIBLE COLLATERAL" means shares of the Common Stock (or security entitlements in respect thereof), provided that Pledgor has good and marketable title thereto, free of all Liens (other than the Security Interests) and Transfer Restrictions (other than any Existing Transfer Restrictions applicable to such shares) and that Secured Party has a valid, first priority perfected security interest therein, a first lien thereon and Control with respect thereto, provided further that to the extent the number of shares of Common Stock or security entitlements in respect thereof pledged hereunder exceeds at any time the Maximum Deliverable Number, such excess shares shall not be Eligible Collateral. "EXISTING TRANSFER RESTRICTIONs" means the Transfer Restrictions on the shares of Common Stock pledged hereunder arising solely from the fact that 2 Pledgor is an "affiliate", within the meaning of Rule 144 under the Securities Act, of the Company. "INITIAL PLEDGED ITEMS" has the meaning provided in Section 1(b). "LIEN" means any lien, mortgage, security interest, pledge, charge or encumbrance of any kind. "LOCATION" means, with respect to any party, the place such party is deemed located within the meaning of Section 9-307 of the UCC. "MAXIMUM DELIVERABLE NUMBER" means, on any date, the aggregate sum, for all Notes outstanding under the Note Purchase Agreement, of (i) if no Exchange Date for such Note has occurred, the number of shares that would be deliverable upon exchange of such Note if the Exchange Date for such Note were to occur on such date; (ii) if Secured Party has elected to exercise its right to exchange such Note pursuant to Section 7 of the Note Purchase Agreement and Pledgor has not yet delivered to Secured Party the Exchange Shares for such Note in the manner required by the Note Purchase Agreement, the number of Exchange Shares for such Note; or (iii) if (x) Secured Party has elected to exercise its right to exchange such Note pursuant to Section 7 of the Note Purchase Agreement and Pledgor has fully satisfied its obligations under the Note Purchase Agreement in respect thereof, or (y) the Exchange Date for such Note has occurred and Secured Party has not elected to exercise its right to exchange such Note, zero. "ORDINARY DIVIDENDS" has the meaning provided in Section 6(a). "PERSON" means an individual, a corporation, a partnership, an association, a trust or any other entity or organization, including a government or political subdivision or an agency or instrumentality thereof. "PLEDGE TERMINATION DATE" shall mean the date the Maximum Deliverable Number is reduced to zero. "SECURITIES ACT" means the Securities Act of 1933, as amended. "SECURITY INTERESTS" means the security interests in the Collateral created hereby. "TRANSFER RESTRICTION" means, with respect to any security or item of collateral pledged under this Agreement, any condition to or restriction on the ability of the holder thereof to sell, assign or otherwise transfer such security or to enforce the provisions thereof or of any document related thereto whether set forth in such security itself or in any document related thereto, including, without limitation, (i) any requirement that any sale, assignment or transfer or enforcement of such security be consented to or approved by any person, including, without limitation, the issuer thereof or any other obligor thereon, (ii) any limitations on the type or status, financial or otherwise, of any purchaser, pledgee, assignee or transferee of such security, (iii) any requirement of the delivery of any certificate, consent, agreement, opinion of counsel, notice or any other document of any person to the issuer of, any other obligor on or any registrar or transfer agent for, such security, prior to the sale, pledge, assignment or other transfer or enforcement of such security and (iv) any registration or qualification requirement or prospectus delivery requirement for such security pursuant to any federal, state or foreign securities law (including, without limitation, any such requirement arising as a result of Rule 144 or Rule 145 under the Securities Act); provided that the required delivery of any assignment, instruction or entitlement order from the seller, pledgor, assignor or transferor of such security, together with any evidence of the corporate or other authority of such Person, shall not constitute a "TRANSFER RESTRICTION". "UCC" means the Uniform Commercial Code as in effect in the State of New York. SECTION 3. Representations and Warranties of Pledgor. Pledgor hereby represents and warrants to Secured Party that: (a) Pledgor (i) owns and at all times prior to the release of the Collateral pursuant to the terms of this Agreement, will own such Collateral free and clear of any Liens (other than the Security Interests) or Transfer Restrictions (other than any Existing Transfer Restrictions) and (ii) is not and will not become a party to or otherwise bound by any agreement, other than this Agreement, that (x) restricts in any manner the rights of any present or future owner of Collateral with respect thereto or (y) provides any person other than Pledgor, Secured Party or any securities intermediary through whom any Collateral is held (but, in the case of any such securities intermediary, only in respect of Collateral held through it) with Control with respect to any such Collateral. (b) Other than financing statements or other similar or equivalent documents or instruments with respect to the Security Interests, no financing statement, security agreement or similar or equivalent document or instrument covering all or any part of the Collateral is on file or of record in any jurisdiction in 3 which such filing or recording would be effective to perfect a lien, security interest or other encumbrance of any kind on such Collateral. (c) All shares of Common Stock at any time pledged hereunder (or in respect of which security entitlements are pledged hereunder) are and will be issued by an issuer organized under the laws of the United States, any State thereof, the District of Columbia or Canada and (i) certificated (and the certificate or certificates in respect of such shares of Common Stock are and will be located in the United States) and registered in the name of Pledgor or held through a securities intermediary whose securities intermediary's jurisdiction (within the meaning of Section 8-110(e) of the UCC) is located in the United States or (ii) uncertificated and either registered in the name of Pledgor or held through a securities intermediary whose securities intermediary's jurisdiction (within the meaning of Section 8-110(e) of the UCC) is located in the United States; provided that this representation shall not be deemed to be breached if, at any time, any such Collateral is issued by an issuer that is not organized under the laws of the United States, any State thereof, the District of Columbia or Canada, and the parties hereto agree to procedures or amendments hereto necessary to enable Secured Party to maintain a valid and continuously perfected security interest in such Collateral, in respect of which Secured Party will have Control, subject to no prior Lien. The parties hereto agree to negotiate in good faith any such procedures or amendments. (d) (i) Upon the delivery of certificates evidencing any Common Stock to Secured Party in accordance with Section 5(c)(A) or the registration of uncertificated Common Stock in the name of Secured Party or its nominee in accordance with Section 5(c)(B), and, in each case, the crediting of such securities or financial assets to the Collateral Account, Secured Party will have a valid and, as long as Secured Party retains possession of such certificates or such uncertificated Common Stock remains so registered, perfected security interest therein, in respect of which Secured Party will have Control, subject to no prior Lien and (ii) upon the crediting of any Common Stock to the Collateral Account, Secured Party will have a valid and, so long as such Common Stock continues to be credited to the Collateral Account, perfected security interest in a securities entitlement in respect thereof, in respect of which Secured Party will have Control subject to no prior Lien. (e) No registration, recordation or filing with any governmental body, agency or official is required in connection with the execution and delivery of this Agreement or necessary for the validity or enforceability hereof or thereof or for the perfection or enforcement of the Security Interests. (f) Pledgor has not performed and will not perform any acts that might prevent Secured Party from enforcing any of the terms of this Agreement or that might limit Secured Party in any such enforcement. (g) The Location of Pledgor is the address set forth in Section 8(e), and under the Uniform Commercial Code as in effect in such Location, no local filing is required to perfect a security interest in collateral consisting of general intangibles. SECTION 4. Certain Covenants of Pledgor. Pledgor agrees that, until the Pledge Termination Date: (a) Pledgor shall ensure at all times that a Collateral Event of Default shall not occur, and shall pledge additional Collateral in the manner described in Sections 5(b) and 5(c) as necessary to cause such requirement to be met. (b) Pledgor shall, at the expense of Pledgor and in such manner and form as Secured Party may reasonably require, give, execute, deliver, file and record any financing statement, notice, instrument, document, agreement or other papers that may be necessary or desirable in order (i) to create, preserve, perfect, substantiate or validate any security interest granted pursuant hereto, (ii) to create or maintain Control with respect to any such security interests in any investment property (as defined in Section 9-102 of the UCC) or (iii) to enable Secured Party to exercise and enforce its rights hereunder with respect to such security interest. To the extent permitted by applicable law, Pledgor hereby authorizes Secured Party to execute and file, in the name of Pledgor or otherwise, UCC financing or continuation statements (which may be carbon, photographic, photostatic or other reproductions of this Agreement or of a financing statement relating to this Agreement) that Secured Party in its sole discretion may deem necessary or appropriate to further perfect, or maintain the perfection of, the Security Interests. (c) Pledgor shall warrant and defend its title to the Collateral, subject to the rights of Secured Party, against the claims and demands of all persons. Secured Party may elect, but without an obligation to do so, to discharge any Lien of any third party on any of the Collateral. (d) Pledgor agrees that it shall not change (1) its name or identity, and if Pledgor is not a natural person, its corporate, limited liability company 4 or partnership structure in any manner or (2) its Location, unless in either case (A) it shall have given Secured Party not less than 30 days' prior notice thereof and (B) such change shall not cause any of the Security Interests to become unperfected, cause Secured Party to cease to have Control in respect of any of the Security Interests in any Collateral consisting of investment property (as defined in Section 9-102 of the UCC) or subject any Collateral to any other Lien. (e) Pledgor agrees that it shall not (1) create or permit to exist any Lien (other than the Security Interests) or any Transfer Restriction (other than any Existing Transfer Restrictions) upon or with respect to the Collateral, (2) sell or otherwise dispose of, or grant any option with respect to, any of the Collateral or (3) enter into or consent to any agreement pursuant to which any person other than Pledgor, Secured Party and any securities intermediary through whom any of the Collateral is held (but in the case of any such securities intermediary only in respect of Collateral held through it) has or will have Control in respect of any Collateral. SECTION 5. Administration of the Collateral and Valuation of the Securities. (a) Calculation Agent shall determine on each Business Day whether a Collateral Event of Default shall have occurred. (b) Pledgor may pledge additional Eligible Collateral hereunder at any time. Concurrently with the delivery of any additional Eligible Collateral, Pledgor shall deliver to Secured Party a certificate of an Authorized Officer of Pledgor substantially in the form of Exhibit A hereto and dated the date of such delivery, (A) identifying the additional items of Eligible Collateral being pledged, and (B) certifying that with respect to such items of additional Eligible Collateral the representations and warranties contained in paragraphs (a), (b), (c) and (d) of Section 3 are true and correct with respect to such Eligible Collateral on and as of the date thereof. Pledgor hereby covenants and agrees to take all actions required under Section 5(c) and any other actions necessary to create for the benefit of Secured Party a valid, first priority, perfected security interest in, and a first lien upon, such additional Eligible Collateral, as to which Secured Party will have Control. (c) Any delivery of Common Stock (or security entitlements in respect thereof) as Collateral to Secured Party by Pledgor shall be effected (A) in the case of Collateral consisting of certificated Common Stock registered in the name of Pledgor, by delivery of certificates representing such Common Stock to Secured Party, accompanied by any required transfer tax stamps, and in suitable form for transfer by delivery or accompanied by duly executed instruments of transfer or assignment in blank, with signatures appropriately guaranteed, all in form and substance satisfactory to Secured Party, and the crediting by Secured Party of such securities to a securities account (as defined in Section 8-501 of the UCC) (the "COLLATERAL ACCOUNT") of Secured Party maintained at Banc of America Securities LLC, who will hold the Collateral, including such securities, as custodian for Secured Party, (B) in the case of Collateral consisting of uncertificated Common Stock registered in the name of Pledgor, by transmission by Pledgor of an instruction to the issuer of such Common Stock instructing such issuer to register such Common Stock in the name of Secured Party or its nominee, accompanied by any required transfer tax stamps, the issuer's compliance with such instructions and the crediting by Secured Party of such securities to the Collateral Account, (C) in the case of Common Stock in respect of which security entitlements are held by Pledgor through a securities intermediary, by the crediting of such Common Stock, accompanied by any required transfer tax stamps, to a securities account of Secured Party at such securities intermediary or, at the option of Secured Party, at another securities intermediary satisfactory to Secured Party and the crediting by Secured Party of such securities to the Collateral Account or (D) in any case, by complying with such alternative delivery instructions as Secured Party shall provide to Pledgor in writing. Upon delivery of any such Pledged Item under this Agreement, Secured Party shall examine such Pledged Item and any certificates delivered pursuant to Section 5(b) or otherwise pursuant to the terms hereof in connection therewith to determine that they comply as to form with the requirements for Eligible Collateral. (d) If on any Business Day Secured Party determines that a Collateral Event of Default shall have occurred, Secured Party shall promptly notify Pledgor of such determination by telephone call to an Authorized Officer of Pledgor followed by a written confirmation of such call. (e) If on any Business Day Secured Party determines that no Event of Default or failure by Pledgor to meet any of its obligations under Sections 4 or 5 hereof has occurred and is continuing, Pledgor may obtain the release from the Security Interests of any Collateral upon delivery to Secured Party of a written notice from an Authorized Officer of Pledgor indicating the items of Collateral to be released so long as, after such release, no Collateral Event of Default shall have occurred. 5 (f) If Secured Party exercises its right to exchange any Note pursuant to Section 7 of the Note Purchase Agreement, unless Pledgor shall have otherwise effected the deliveries required by Section 7 of the Note Purchase Agreement, Secured Party shall have the right, at its election, to deliver or cause to be delivered to itself from the Collateral Account, in whole or partial, as the case may be, satisfaction of Pledgor's obligations to deliver shares of such Common Stock on the Exchange Date pursuant to the Note Purchase Agreement, shares of such Common Stock (or security entitlements in respect thereof) then held by or on behalf of Secured Party hereunder representing the number of shares of such Common Stock required to be delivered under the Note Purchase Agreement on the Exchange Date. Upon any such delivery, Secured Party shall hold such shares of such Common Stock (or security entitlements in respect thereof) absolutely and free from any claim or right whatsoever (including, without limitation, any claim or right of Pledgor). (g) Secured Party may at any time or from time to time, in its sole discretion, cause any or all of the Common Stock pledged hereunder (or in respect of which security entitlements are pledged hereunder) registered in the name of Pledgor or its nominee to be transferred of record into the name of Secured Party or its nominee. Pledgor shall promptly give to Secured Party copies of any notices or other communications received by Pledgor with respect to Common Stock (or security entitlements in respect thereof) pledged hereunder registered, or held through a securities intermediary, in the name of Pledgor or Pledgor's nominee and Secured Party shall promptly give to Pledgor copies of any notices and communications received by Secured Party with respect to Common Stock (or security entitlements in respect thereof) pledged hereunder registered, or held through a securities intermediary, in the name of Secured Party or its nominee. (h) Pledgor agrees that Pledgor shall forthwith upon demand pay to Secured Party: (i) the amount of any taxes that Secured Party may have been required to pay by reason of the Security Interests or to free any of the Collateral from any Lien thereon, and (ii) the amount of any and all out-of-pocket expenses, including the reasonable fees and disbursements of counsel and of any other experts, that Secured Party may incur in connection with (A) the enforcement of this Agreement, including such expenses as are incurred to preserve the value of the Collateral and the validity, perfection, rank and value of the Security Interests, (B) the collection, sale or other disposition of any of the Collateral, (C) the exercise by Secured Party of any of the rights conferred upon it hereunder or (D) any Event of Default. Any such amount not paid on demand shall bear interest (computed on the basis of a year of 360 days and payable for the actual number of days elapsed) at a rate per annum equal to 2% plus the prime rate as published in The Wall Street Journal, Eastern Edition in effect from time to time during the period from the date hereof to the date of the termination of this Agreement. (i) Pledgor hereby acknowledges that during such time as the Collateral is held by Secured Party pursuant to the terms of this Agreement, Pledgor will not receive periodic account statements with respect to the value thereof. (j) Except as set forth in Section 8(b), unless an Event of Default shall have occurred and be continuing, Secured Party shall not sell, assign, transfer, or otherwise dispose of, lend, borrow against, pledge, grant any option or create any Lien (other than the Security Interests) with respect to the Collateral, or enter into any agreement or arrangement intended to effect any of the foregoing. SECTION 6. Income and Voting Rights in Collateral. (a) Pledgor shall have the right to receive dividends on and distributions from the Collateral to the extent such dividends and distributions consist solely of cash ("ORDINARY DIVIDENDS"). Secured Party shall have the right to receive and retain as Collateral hereunder all proceeds (other than Ordinary Dividends) of the Collateral, and Pledgor shall take all such action as Secured Party shall deem necessary or appropriate to give effect to such right. All such proceeds that are received by Pledgor shall be received in trust for the benefit of Secured Party and, if Secured Party so directs, shall be segregated from other assets of Pledgor and shall, forthwith upon demand by Secured Party, be delivered over to Secured Party as Collateral in the same form as received (with any necessary endorsement). (b) Unless an Event of Default shall have occurred and be continuing, Pledgor shall have the right, from time to time, to vote and to give consents, ratifications and waivers with respect to the Collateral. 6 (c) If an Event of Default shall have occurred and be continuing, Secured Party shall have the right, to the extent permitted by law, and Pledgor shall take all such action as may be necessary or appropriate to give effect to such right, to vote and to give consents, ratifications and waivers, and to take any other action with respect to any or all of the Collateral with the same force and effect as if Secured Party were the absolute and sole owner thereof. SECTION 7. Remedies upon Events of Default. (a) Solely in the event an Event of Default shall have occurred and be continuing, Secured Party may exercise all the rights of a secured party under the Uniform Commercial Code (whether or not in effect in the jurisdiction where such rights are exercised) and, in addition, without being required to give any notice, except as herein provided or as may be required by mandatory provisions of law, shall: (i) deliver or cause to be delivered to itself from the Collateral Account all Collateral consisting of shares of Common Stock (or security entitlements in respect thereof) (but not in excess of the number thereof deliverable under the Note Purchase Agreement at such time) on the relevant acceleration date (the "DEFAULT SETTLEMENT DATE") in satisfaction of Pledgor's obligations to deliver Common Stock under the Note Purchase Agreement, whereupon Secured Party shall hold such shares of Common Stock (or security entitlements in respect thereof) absolutely free from any claim or right of whatsoever kind, including any equity or right of redemption of Pledgor that may be waived or any other right or claim of Pledgor, and Pledgor, to the extent permitted by law, hereby specifically waives all rights of redemption, stay or appraisal that Pledgor has or may have under any law now existing or hereafter adopted; and (ii) if such delivery shall be insufficient to satisfy in full all of the obligations of Pledgor under the Note Purchase Agreement or hereunder, sell all of the remaining Collateral, or such lesser portion thereof as may be necessary to generate proceeds sufficient to satisfy in full all of the obligations of Pledgor under the Note Purchase Agreement or hereunder, at public or private sale or at any broker's board or on any securities exchange, for cash, upon credit or for future delivery, and at such price or prices as Secured Party may deem satisfactory. Pledgor covenants and agrees that it will execute and deliver such documents and take such other action as Secured Party deems necessary or advisable in order that any such sale may be made in compliance with law. Upon any such sale Secured Party shall have the right to deliver, assign and transfer to the buyer thereof the Collateral so sold. Each buyer at any such sale shall hold the Collateral so sold absolutely and free from any claim or right of whatsoever kind, including any equity or right of redemption of Pledgor that may be waived or any other right or claim of Pledgor, and Pledgor, to the extent permitted by law, hereby specifically waives all rights of redemption, stay or appraisal that Pledgor has or may have under any law now existing or hereafter adopted. The notice (if any) of such sale required by Section 9-611 of the UCC shall (1) in case of a public sale, state the time and place fixed for such sale, (2) in case of sale at a broker's board or on a securities exchange, state the board or exchange at which such sale is to be made and the day on which the Collateral, or the portion thereof so being sold, will first be offered for sale at such board or exchange, and (3) in the case of a private sale, state the day after which such sale may be consummated. Any such public sale shall be held at such time or times within ordinary business hours and at such place or places as Secured Party may fix in the notice of such sale. At any such sale the Collateral may be sold in one lot as an entirety or in separate parcels, as Secured Party may determine. Secured Party shall not be obligated to make any such sale pursuant to any such notice. Secured Party may, without notice or publication, adjourn any public or private sale or cause the same to be adjourned from time to time by announcement at the time and place fixed for the sale, and such sale may be made at any time or place to which the same may be so adjourned. In case of any sale of all or any part of the Collateral on credit or for future delivery, the Collateral so sold may be retained by Secured Party until the selling price is paid by the buyer thereof, but Secured Party shall not incur any liability in case of the failure of such buyer to take up and pay for the Collateral so sold and, in case of any such failure, such Collateral may again be sold upon like notice. Secured Party, instead of exercising the power of sale herein conferred upon it, may proceed by a suit or suits at law or in equity to foreclose the Security Interests and sell the Collateral, or any portion thereof, under a judgment or decree of a court or courts of competent jurisdiction. Except as set forth in Section 8(b), unless an Event of Default shall have occurred and be continuing, Secured Party shall not be entitled to take any such actions as set forth in this Section 7(a) in respect of the Collateral. (b) Pledgor hereby irrevocably appoints Secured Party Pledgor's true and lawful attorney, with full power of substitution, in the name of Pledgor, Secured Party or otherwise, for the sole use and benefit of Secured Party, but at the expense of Pledgor, to the extent permitted by law, to exercise, at any time and from time to time while an Event of Default has occurred and is continuing, all or any of the following powers with respect to all or any of the Collateral: 7 (i) to demand, sue for, collect, receive and give acquittance for any and all monies due or to become due upon or by virtue thereof, (ii) to settle, compromise, compound, prosecute or defend any action or proceeding with respect thereto, (iii) to sell, transfer, assign or otherwise deal in or with the same or the proceeds or avails thereof, as fully and effectually as if Secured Party were the absolute owner thereof (including, without limitation, the giving of instructions and entitlement orders in respect thereof), and (iv) to extend the time of payment of any or all thereof and to make any allowance and other adjustments with reference thereto; provided that Secured Party shall give Pledgor not less than five days' prior written notice of the time and place of any sale or other intended disposition of any of the Collateral, except any Collateral that threatens to decline speedily in value, including, without limitation, equity securities, or is of a type customarily sold on a recognized market. Secured Party and Pledgor agree that such notice constitutes reasonable authenticated notification within the meaning of Section 9-611 of the UCC. (c) Upon any delivery or sale of all or any part of any Collateral made either under the power of delivery or sale given hereunder or under judgment or decree in any judicial proceedings for foreclosure or otherwise for the enforcement of this Agreement, Secured Party is hereby irrevocably appointed the true and lawful attorney of Pledgor, in the name and stead of Pledgor, to make all necessary deeds, bills of sale, instruments of assignment, transfer or conveyance of the property, and all instructions and entitlement orders in respect of the property, thus delivered or sold. For that purpose Secured Party may execute all such documents, instruments, instructions and entitlement orders. This power of attorney shall be deemed coupled with an interest, and Pledgor hereby ratifies and confirms that which Pledgor's attorney acting under such power, or such attorney's successors or agents, shall lawfully do by virtue of this Agreement. If so requested by Secured Party or by any buyer of the Collateral or a portion thereof, Pledgor shall further ratify and confirm any such delivery or sale by executing and delivering to Secured Party or to such buyer or buyers at the expense of Pledgor all proper deeds, bills of sale, instruments of assignment, conveyance or transfer, releases, instructions and entitlement orders as may be designated in any such request. (d) In the case of an Event of Default, Secured Party may proceed to realize upon the security interest in the Collateral against any one or more of the types of Collateral, at any time, as Secured Party shall determine in its sole discretion subject to the foregoing provisions of this Section 7. The proceeds of any sale of, or other realization upon, or other receipt from, any of the Collateral shall be applied by Secured Party in the following order of priorities: first, to the payment to Secured Party of the expenses of such sale or other realization, including reasonable compensation to the agents and counsel of Secured Party, and all expenses, liabilities and advances incurred or made by Secured Party in connection therewith, including brokerage fees in connection with the sale by Secured Party of any Collateral; second, to the payment to Secured Party of any amount due under the Note Purchase Agreement; finally, if all of the obligations of Pledgor hereunder and under the Note Purchase Agreement have been fully discharged or sufficient funds have been set aside by Secured Party, at the request of Pledgor for the discharge thereof, any remaining proceeds shall be released to Pledgor. SECTION 8. Miscellaneous. (a) Whenever any of the parties hereto is referred to, such reference shall be deemed to include the successors and assigns of such party. All the covenants and agreements herein contained by or on behalf of Pledgor shall bind, and inure to the benefit of, Pledgor's respective successors and assigns whether so expressed or not, and shall be enforceable by and inure to the benefit of Secured Party and its successors and assigns. (b) Secured Party may transfer or assign its rights and obligations hereunder in whole or in part at any time to any transferee or assignee of the Notes in connection with the transfer or assignment of any Notes pursuant to the terms of the Note Purchase Agreement. 8 (c) To the extent permitted by law, the unenforceability or invalidity of any provision or provisions of this Agreement shall not render any other provision or provisions herein contained unenforceable or invalid. (d) Any provision of this Agreement may be amended or waived if, and only if, such amendment or waiver is in writing and signed, in the case of an amendment, by Pledgor and Secured Party or, in the case of a waiver, by the party against whom the waiver is to be effective. No failure or delay by either party in exercising any right, power or privilege hereunder shall operate as a waiver thereof nor shall any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any other right, power or privilege. The rights and remedies herein provided shall be cumulative and not exclusive of any rights or remedies provided by law. (e) All notices and other communications hereunder shall be in writing and shall be deemed to have been duly given if mailed or transmitted by any standard forms of telecommunication. Notices to Pledgor shall be directed to it at the address specified on the last page hereof; notices to Secured Party shall be directed to it care of NMS Services (Cayman) Inc., 9 West 57th Street, New York, New York 10019, Telecopy No. 212-847-6556, Attention: Glen Rae. (f) This Agreement shall in all respects be construed in accordance with and governed by the laws of the State of New York (without reference to choice of law doctrine); provided that as to the Collateral located in any jurisdiction other than the State of New York, Secured Party shall have, in addition to any rights under the laws of the State of New York, all of the rights to which a secured party is entitled under the laws of such other jurisdiction. The parties hereto hereby agree that Secured Party's and Banc of America Securities LLC's jurisdiction, within the meaning of Section 8-110(e) of the UCC, insofar as it acts as a securities intermediary hereunder or in respect hereof, is the State of New York. (g) EACH PARTY HEREBY IRREVOCABLY AND UNCONDITIONALLY SUBMITS TO THE NON-EXCLUSIVE JURISDICTION OF THE FEDERAL AND STATE COURTS LOCATED IN THE BOROUGH OF MANHATTAN, IN THE CITY OF NEW YORK IN ANY SUIT OR PROCEEDING ARISING OUT OF OR RELATING TO THIS AGREEMENT, OR THE TRANSACTIONS CONTEMPLATED HEREBY. (h) EACH PARTY HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATED TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY. (i) This Agreement may be executed, acknowledged and delivered in any number of counterparts and all such counterparts taken together shall be deemed to constitute one and the same agreement. SECTION 9. Termination of Pledge Agreement. This Agreement and the rights hereby granted by Pledgor in the Collateral shall cease, terminate and be void as of the Pledge Termination Date. Any Collateral remaining at the time of such termination shall be fully released and discharged from the Security Interests and delivered to Pledgor by Secured Party, all at the request and expense of Pledgor. 9 ************* Date of Agreement: November 19, 2004 Pledgor: Fairfax Financial (US) LLC, a limited liability company existing under the laws of the State of Delaware. Pledgor's Address for Notices: 5205 North O'Connor Blvd. Irving, TX 75039 Telecopy No. 972-831-6368 Attention: John Cassil, President ************* IN WITNESS WHEREOF, the parties have signed this Agreement as of the date and year first above written. PLEDGOR: FAIRFAX FINANCIAL (US) LLC By: /s/ John Cassil ---------------------------- Name: John Cassil Title: President SECURED PARTY: NMS SERVICES (CAYMAN) INC. By: /s/ Eric P. Hambleton ---------------------------- Name: Eric P. Hambleton Title: Authorized Signatory AGENT: BANC OF AMERICA SECURITIES LLC By: /s/ Robert Kevin Beauregard ---------------------------- Name: Robert Kevin Beauregard Title: Managing Director Exhibit A to Pledge Agreement CERTIFICATE FOR ADDITIONAL COLLATERAL The undersigned, an Authorized Officer of Fairfax Financial (US) LLC ("PLEDGOR"), hereby certifies, pursuant to Section 5(b) of the Pledge Agreement, dated as of November 19, 2004, among Pledgor, NMS Services (Cayman) Inc. and Banc of America Securities LLC, as Agent (the "PLEDGE AGREEMENT"; terms defined in the Pledge Agreement being used herein as defined therein), that: 1. Pledgor is delivering, or causing to be delivered in accordance with Section 5(c) of the Pledge Agreement, the following securities (or security entitlements in respect thereof) to Secured Party to be held by or on behalf of Secured Party as additional Collateral (the "ADDITIONAL COLLATERAL"): 2. Pledgor hereby represents and warrants to Secured Party that the Additional Collateral is Eligible Collateral and that the representations and warranties contained in paragraphs (a), (b), (c) and (d) of Section 3 of the Pledge Agreement are true and correct with respect to the Additional Collateral on and as of the date hereof. IN WITNESS WHEREOF, the undersigned has executed this Certificate this ___ day of __________, 200_. FAIRFAX FINANCIAL (US) LLC By: _____________________________ Name: Title: A-1 EX-2.11 12 t14767exv2w11.txt EX-2.11 CUSIP No. 67612W108 AGREEMENT CONCERNING JOINT FILING OF AMENDMENT NO. 1 TO SCHEDULE 13D The undersigned agree as follows: (i) each of them is individually eligible to use Schedule 13D to which this Exhibit is attached, and such Schedule 13D is filed on behalf of each of them; and (ii) each of them is responsible for the timely filing of such Schedule 13D and any amendments thereto, and for the completeness and accuracy of the information concerning such person contained therein; but none of them is responsible for the completeness or accuracy of the information concerning the other person making the filing, unless such person knows or has reason to believe that such information is inaccurate. This Agreement may be executed in any number of counterparts, each of which shall be deemed to be an original, but all of which, taken together, shall constitute one and the same instrument. Dated November 23, 2004 V. PREM WATSA /s/ V. Prem Watsa ---------------------------------------------- 1109519 ONTARIO LIMITED By: /s/ V. Prem Watsa ------------------------------------------ Name: V. Prem Watsa Title: President THE SIXTY TWO INVESTMENT COMPANY LIMITED By: /s/ V. Prem Watsa ------------------------------------------ Name: V. Prem Watsa Title: President 810679 ONTARIO LIMITED By: /s/ V. Prem Watsa ------------------------------------------ Name: V. Prem Watsa Title: President FAIRFAX FINANCIAL HOLDINGS LIMITED By: /s/ Eric P. Salsberg ------------------------------------------ Name: Eric P. Salsberg Title: Vice President, Corporate Affairs FFHL GROUP LTD. By: /s/ Eric P. Salsberg ------------------------------------------ Name: Eric P. Salsberg Title: Vice President FAIRFAX INC. By: /s/ Eric P. Salsberg ------------------------------------------ Name: Eric P. Salsberg Title: Vice President FAIRFAX FINANCIAL (US) LLC. By: /s/ Bradley P. Martin ------------------------------------------ Name: Bradley P. Martin Title: Vice President TIG HOLDINGS, INC. By: /s/ R. Scott Donovan ------------------------------------------ Name: R. Scott Donovan Title: President TIG INSURANCE GROUP By: /s/ R. Scott Donovan ------------------------------------------ Name: R. Scott Donovan Title: President TIG INSURANCE COMPANY By: /s/ R. Scott Donovan ------------------------------------------ Name: R. Scott Donovan Title: President ORH HOLDINGS INC. By: /s/ Eric P. Salsberg ------------------------------------------ Name: Eric P. Salsberg Title: Vice President UNITED STATES FIRE INSURANCE COMPANY By: /s/ Mary Jane Robertson ------------------------------------------ Name: Mary Jane Robertson Title: Senior Executive Vice President, Chief Financial Officer & Treasurer -----END PRIVACY-ENHANCED MESSAGE-----