Schedule 13D

the Conversion Rate in effect at the close of business on the Expiration Date

the Conversion Rate in effect immediately after the Expiration Date

-----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, VCQDG9uZMb7kkyN7FhZHsoE65ZZDecbTb8KfxmtPd42kOt5utoNS02HjhFOkPVJo ZaSVo0DTrBZ9sSWT9faW+w== 0001193125-08-159138.txt : 20080728 0001193125-08-159138.hdr.sgml : 20080728 20080728172841 ACCESSION NUMBER: 0001193125-08-159138 CONFORMED SUBMISSION TYPE: SC 13D PUBLIC DOCUMENT COUNT: 8 FILED AS OF DATE: 20080728 DATE AS OF CHANGE: 20080728 GROUP MEMBERS: FINANACIAL SERVICE OPPORTUNITIES L.P. GROUP MEMBERS: FSO GP L.P. GROUP MEMBERS: FSO GP LTD. GROUP MEMBERS: J. CHRISTOPHER FLOWERS GROUP MEMBERS: J.C. FLOWERS II-A L.P. GROUP MEMBERS: J.C. FLOWERS II-B L.P. GROUP MEMBERS: JCF ASSOCIATES II L.P. GROUP MEMBERS: JCF ASSOCIATES II LTD. GROUP MEMBERS: JCF ASSOCIATES II-A L.P. GROUP MEMBERS: JCF ASSOCIATES II-A LLC SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: MF Global Ltd. CENTRAL INDEX KEY: 0001401106 STANDARD INDUSTRIAL CLASSIFICATION: SECURITY & COMMODITY BROKERS, DEALERS, EXCHANGES & SERVICES [6200] IRS NUMBER: 000000000 STATE OF INCORPORATION: D0 FISCAL YEAR END: 0331 FILING VALUES: FORM TYPE: SC 13D SEC ACT: 1934 Act SEC FILE NUMBER: 005-83051 FILM NUMBER: 08973782 BUSINESS ADDRESS: STREET 1: 717 FIFTH AVENUE STREET 2: 9TH FLOOR CITY: NEW YORK STATE: NY ZIP: 10022 BUSINESS PHONE: (441) 295-5950 MAIL ADDRESS: STREET 1: CLARENDON HOUSE STREET 2: 2 CHURCH STREET CITY: HAMILTON STATE: D0 ZIP: HM 11 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: J.C. Flowers II L.P. CENTRAL INDEX KEY: 0001441307 IRS NUMBER: 980494093 STATE OF INCORPORATION: E9 FILING VALUES: FORM TYPE: SC 13D BUSINESS ADDRESS: STREET 1: 717 FIFTH AVENUE STREET 2: 26TH FLOOR CITY: NEW YORK STATE: NY ZIP: 10022 BUSINESS PHONE: 212 404 6800 MAIL ADDRESS: STREET 1: 717 FIFTH AVENUE STREET 2: 26TH FLOOR CITY: NEW YORK STATE: NY ZIP: 10022 SC 13D 1 dsc13d.htm SCHEDULE 13D Schedule 13D

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

SCHEDULE 13D

Under the Securities Exchange Act of 1934

MF Global Ltd.

(Name of Issuer)

Common Stock, par value $1.00 per share

(Title of Class of Securities)

G60642108

(CUSIP Number)

c/o J.C. Flowers & Co. LLC

717 Fifth Avenue, 26^th Floor

New York, NY 10022

Attention: Sally A. Rocker, Esq.

Telephone: (212) 404- 6800

(Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications)

Copy to:

Debevoise & Plimpton

919 Third Avenue

New York, New York 10022

Attention: Gregory V. Gooding, Esq.

Telephone: (212) 909-6000

July 18, 2008

(Date of Event which Requires Filing Statement on Schedule 13D)

If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of §§ 240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check the following box ¨.

Note: Schedules filed in paper format shall include a signed original and five copies of the schedule, including all exhibits. See Rule 13d-7 for other parties to whom copies are to be sent.

*	The remainder of this cover page shall be filled out for a reporting person’s initial filing on this form with respect to the subject class of securities, and for any subsequent amendment containing information which would alter disclosures provided in a prior cover page.

The information required on the remainder of this cover page shall not be deemed to be “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934 (“Act”) 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).

(Continued on following pages)

Schedule 13D

CUSIP No. G60642108


(1)		Name of Reporting Person J.C. Flowers II L.P. S.S. or I.R.S. Identification No. of Above Person 98-0494093
(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 if Disclosure of Legal Proceedings is Required Pursuant to Items 2(d) or 2(e)
(6)		Citizenship or Place of Organization Cayman Islands


Number of Shares Beneficially Owned by Each Reporting Person With		(7) Sole Voting Power^* -0-
		(8) Shared Voting Power^* 8,538,328
		(9) Sole Dispositive Power^* -0-
		(10) Shared Dispositive Power^* 8,538,328


(11)		Aggregate Amount Beneficially Owned by Each Reporting Person^* 8,538,328
(12)		Check if the Aggregate Amount in Row (11) Excludes Certain Shares
(13)		Percent of Class Represented by Amount in Row (11)^*,± 6.5%
(14)		Type of Reporting Person PN

*	See Item 5.

The calculation of the foregoing percentage is based on 131,647,222 shares of Common Stock (as defined herein) outstanding, which is the sum of (i) 119,647,222 shares of Common Stock outstanding as of March 31, 2008, as reported in Issuer’s Form 10-K filed on June 13, 2008 and (ii) 12,000,000 shares of Common Stock issuable upon conversion of the Series A Preferred Stock (as defined herein), calculated as of the date hereof.

Schedule 13D

CUSIP No. G60642108


(1)		Name of Reporting Person J.C. Flowers II-B L.P. S.S. or I.R.S. Identification No. of Above Person 98-0500587
(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 if Disclosure of Legal Proceedings is Required Pursuant to Items 2(d) or 2(e)
(6)		Citizenship or Place of Organization Cayman Islands


Number of Shares Beneficially Owned by Each Reporting Person With		(7) Sole Voting Power^* -0-
		(8) Shared Voting Power^* 523,096
		(9) Sole Dispositive Power^* -0-
		(10) Shared Dispositive Power^* 523,096


(11)		Aggregate Amount Beneficially Owned by Each Reporting Person^* 523,096
(12)		Check if the Aggregate Amount in Row (11) Excludes Certain Shares
(13)		Percent of Class Represented by Amount in Row (11)^*,± 0.4%
(14)		Type of Reporting Person PN

*	See Item 5.

Schedule 13D

CUSIP No. G60642108


(1)		Name of Reporting Person JCF Associates II L.P. S.S. or I.R.S. Identification No. of Above Person 98-0494094
(2)		Check the Appropriate Box if a Member of a Group (a) ¨ (b) x
(3)		SEC Use Only
(4)		Source of Funds AF
(5)		Check if Disclosure of Legal Proceedings is Required Pursuant to Items 2(d) or 2(e)
(6)		Citizenship or Place of Organization Cayman Islands


Number of Shares Beneficially Owned by Each Reporting Person With		(7) Sole Voting Power^* -0-
		(8) Shared Voting Power^* 9,061,424
		(9) Sole Dispositive Power^* -0-
		(10) Shared Dispositive Power^* 9,061,424


(11)		Aggregate Amount Beneficially Owned by Each Reporting Person^* 9,016,424
(12)		Check if the Aggregate Amount in Row (11) Excludes Certain Shares
(13)		Percent of Class Represented by Amount in Row (11)^*,± 6.9%
(14)		Type of Reporting Person PN

*	See Item 5.

Schedule 13D

CUSIP No. G60642108


(1)		Name of Reporting Person JCF Associates II Ltd. S.S. or I.R.S. Identification No. of Above Person 98-0494097
(2)		Check the Appropriate Box if a Member of a Group (a) ¨ (b) x
(3)		SEC Use Only
(4)		Source of Funds AF
(5)		Check if Disclosure of Legal Proceedings is Required Pursuant to Items 2(d) or 2(e)
(6)		Citizenship or Place of Organization Cayman Islands


Number of Shares Beneficially Owned by Each Reporting Person With		(7) Sole Voting Power^* -0-
		(8) Shared Voting Power^* 9,061,424
		(9) Sole Dispositive Power^* -0-
		(10) Shared Dispositive Power^* 9,061,424


(11)		Aggregate Amount Beneficially Owned by Each Reporting Person^* 9,061,424
(12)		Check if the Aggregate Amount in Row (11) Excludes Certain Shares
(13)		Percent of Class Represented by Amount in Row (11)^*,± 6.9%
(14)		Type of Reporting Person OO

*	See Item 5.

Schedule 13D

CUSIP No. G60642108


(1)		Name of Reporting Person J.C. Flowers II-A L.P. S.S. or I.R.S. Identification No. of Above Person 98-0500592
(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 if Disclosure of Legal Proceedings is Required Pursuant to Items 2(d) or 2(e)
(6)		Citizenship or Place of Organization Alberta, Canada


Number of Shares Beneficially Owned by Each Reporting Person With		(7) Sole Voting Power^* -0-
		(8) Shared Voting Power^* 538,576
		(9) Sole Dispositive Power^* -0-
		(10) Shared Dispositive Power^* 538,576


(11)		Aggregate Amount Beneficially Owned by Each Reporting Person^* 538,576
(12)		Check if the Aggregate Amount in Row (11) Excludes Certain Shares
(13)		Percent of Class Represented by Amount in Row (11)^*,± 0.4%
(14)		Type of Reporting Person PN

*	See Item 5.

Schedule 13D

CUSIP No. G60642108


(1)		Name of Reporting Person JCF Associates II-A L.P. S.S. or I.R.S. Identification No. of Above Person 20-5093556
(2)		Check the Appropriate Box if a Member of a Group (a) ¨ (b) x
(3)		SEC Use Only
(4)		Source of Funds AF
(5)		Check if Disclosure of Legal Proceedings is Required Pursuant to Items 2(d) or 2(e)
(6)		Citizenship or Place of Organization Delaware


Number of Shares Beneficially Owned by Each Reporting Person With		(7) Sole Voting Power^* -0-
		(8) Shared Voting Power^* 538,576
		(9) Sole Dispositive Power^* -0-
		(10) Shared Dispositive Power^* 538,576


(11)		Aggregate Amount Beneficially Owned by Each Reporting Person^* 538,576
(12)		Check if the Aggregate Amount in Row (11) Excludes Certain Shares
(13)		Percent of Class Represented by Amount in Row (11)^*,± 0.4%
(14)		Type of Reporting Person PN

*	See Item 5.

Schedule 13D

CUSIP No. G60642108


(1)		Name of Reporting Person JCF Associates II-A LLC S.S. or I.R.S. Identification No. of Above Person 20-5092853
(2)		Check the Appropriate Box if a Member of a Group (a) ¨ (b) x
(3)		SEC Use Only
(4)		Source of Funds AF
(5)		Check if Disclosure of Legal Proceedings is Required Pursuant to Items 2(d) or 2(e)
(6)		Citizenship or Place of Organization Delaware


Number of Shares Beneficially Owned by Each Reporting Person With		(7) Sole Voting Power^* -0-
		(8) Shared Voting Power^* 538,576
		(9) Sole Dispositive Power^* -0-
		(10) Shared Dispositive Power^* 538,576


(11)		Aggregate Amount Beneficially Owned by Each Reporting Person^* 538,576
(12)		Check if the Aggregate Amount in Row (11) Excludes Certain Shares
(13)		Percent of Class Represented by Amount in Row (11)^*,± 0.4%
(14)		Type of Reporting Person OO

*	See Item 5.

Schedule 13D

CUSIP No. G60642108


(1)		Name of Reporting Person Financial Service Opportunities L.P. S.S. or I.R.S. Identification No. of Above Person 98-0582926
(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 if Disclosure of Legal Proceedings is Required Pursuant to Items 2(d) or 2(e)
(6)		Citizenship or Place of Organization Cayman Islands


Number of Shares Beneficially Owned by Each Reporting Person With		(7) Sole Voting Power^* -0-
		(8) Shared Voting Power^* 2,400,000
		(9) Sole Dispositive Power^* -0-
		(10) Shared Dispositive Power^* 2,400,000


(11)		Aggregate Amount Beneficially Owned by Each Reporting Person^* 2,400,000
(12)		Check if the Aggregate Amount in Row (11) Excludes Certain Shares
(13)		Percent of Class Represented by Amount in Row (11)^*,± 1.8%
(14)		Type of Reporting Person PN

*	See Item 5.

Schedule 13D

CUSIP No. G60642108


(1)		Name of Reporting Person FSO GP L.P. S.S. or I.R.S. Identification No. of Above Person 98-0588172
(2)		Check the Appropriate Box if a Member of a Group (a) ¨ (b) x
(3)		SEC Use Only
(4)		Source of Funds AF
(5)		Check if Disclosure of Legal Proceedings is Required Pursuant to Items 2(d) or 2(e)
(6)		Citizenship or Place of Organization Cayman Islands


Number of Shares Beneficially Owned by Each Reporting Person With		(7) Sole Voting Power^* -0-
		(8) Shared Voting Power^* 2,400,000
		(9) Sole Dispositive Power^* -0-
		(10) Shared Dispositive Power^* 2,400,000


(11)		Aggregate Amount Beneficially Owned by Each Reporting Person^* 2,400,000
(12)		Check if the Aggregate Amount in Row (11) Excludes Certain Shares
(13)		Percent of Class Represented by Amount in Row (11)^*,± 1.8%
(14)		Type of Reporting Person PN

*	See Item 5.

Schedule 13D

CUSIP No. G60642108


(1)		Name of Reporting Person FSO GP Ltd. S.S. or I.R.S. Identification No. of Above Person 98-0588170
(2)		Check the Appropriate Box if a Member of a Group (a) ¨ (b) x
(3)		SEC Use Only
(4)		Source of Funds AF
(5)		Check if Disclosure of Legal Proceedings is Required Pursuant to Items 2(d) or 2(e)
(6)		Citizenship or Place of Organization Cayman Islands


Number of Shares Beneficially Owned by Each Reporting Person With		(7) Sole Voting Power^* -0-
		(8) Shared Voting Power^* 2,400,000
		(9) Sole Dispositive Power^* -0-
		(10) Shared Dispositive Power^* 2,400,000


(11)		Aggregate Amount Beneficially Owned by Each Reporting Person^* 2,400,000
(12)		Check if the Aggregate Amount in Row (11) Excludes Certain Shares
(13)		Percent of Class Represented by Amount in Row (11)^*,± 1.8%
(14)		Type of Reporting Person OO

*	See Item 5.

Schedule 13D

CUSIP No. G60642108


(1)		Name of Reporting Person J. Christopher Flowers S.S. or I.R.S. Identification No. of Above Person
(2)		Check the Appropriate Box if a Member of a Group (a) ¨ (b) x
(3)		SEC Use Only
(4)		Source of Funds AF
(5)		Check if Disclosure of Legal Proceedings is Required Pursuant to Items 2(d) or 2(e)
(6)		Citizenship or Place of Organization U.S. Citizen


Number of Shares Beneficially Owned by Each Reporting Person With		(7) Sole Voting Power^* -0-
		(8) Shared Voting Power^* 12,000,000
		(9) Sole Dispositive Power^* -0-
		(10) Shared Dispositive Power^* 12,000,000


(11)		Aggregate Amount Beneficially Owned by Each Reporting Person^* 12,000,000
(12)		Check if the Aggregate Amount in Row (11) Excludes Certain Shares
(13)		Percent of Class Represented by Amount in Row (11)^*,± 9.1%
(14)		Type of Reporting Person IN

*	See Item 5.

Item 1.

Security and Issuer

This Statement on Schedule 13D (this “Statement”) relates to the Common Stock, par value $1.00 per share (“Common Stock”) of MF Global Ltd., a Bermuda exempted company, (the “Issuer”). The address of the principal executive office of the Issuer is Clarendon House, 2 Church Street, Hamilton HM 11, Bermuda.

The Reporting Persons (as defined below in Item 2) currently hold shares of 6% Cumulative Convertible Preference Shares, Series A, par value $1.00 per share, of the Issuer (“Series A Preferred Stock”). Each share of Series A Preferred Stock (each a “Preference Share” and collectively, the “Series A Preference Shares”) is convertible at any time at the option of the holder of such Preference Share into a certain number of shares of Common Stock, with the precise number of shares of Common Stock issuable upon such conversion determined pursuant to the terms of the Certificate of Designations of 6% Cumulative Convertible Series A Preference Shares, Series A of MF Global Ltd., attached hereto as Exhibit 7.05 (the “Certificate of Designations”). Consequently, the Reporting Persons may be deemed to beneficially own the shares of Common Stock into which the Series A Preference Shares held by the Reporting Persons are convertible.

Item 2.

Identity and Background

(a) This Statement is being filed on behalf of the following persons (collectively, the “Reporting Persons”): (i) J.C. Flowers II L.P., a Cayman Islands exempted limited partnership (“JCF Fund II”); (ii) J.C. Flowers II-A L.P., an Alberta limited partnership (“JCF Fund II-A”); (iii) J.C. Flowers II-B L.P., a Cayman Islands exempted limited partnership (“JCF Fund II-B”); (iv) Financial Service Opportunities L.P., a Cayman Islands exempted limited partnership (“FSO”, and together with JCF Fund II, JCF Fund II-A and JCF Fund II-B, the “JCF Funds”); (v) JCF Associates II L.P., a Cayman Islands exempted limited partnership (“JCF II L.P.”); (vi) JCF Associates II Ltd., a Cayman Islands company (“JCF II Ltd.”); (vii) JCF Associates II-A L.P., a Delaware limited partnership (“JCF II-A L.P.”); (viii) JCF Associates II-A LLC, a Delaware limited liability company (“JCF II-A LLC”); (ix) FSO GP L.P., a Cayman Islands exempted limited partnership (“FSO L.P.”); (x) FSP GP Ltd., a Cayman Islands company (“FSO Ltd.”) and (xi) Mr. J. Christopher Flowers, a natural person and citizen of the United States of America. The agreement among the Reporting Persons to file this Statement jointly in accordance with Rule 13d-1(k) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), is attached hereto as Exhibit 1.

(b) The address of the principal business and principal office of the Reporting Persons is c/o J.C. Flowers & Co. LLC, 717 Fifth Avenue, 26^th Floor, New York, New York 10022.

(c) Each of the JCF Funds is principally engaged in the business of making private equity and related investments. JCF II L.P. is principally engaged in the business of serving as the sole general partner of JCF Fund II and JCF Fund II-B. JCF II Ltd. is principally engaged in the business of serving as the sole general partner of JCF II L.P. JCF II-A L.P. is principally engaged in the business of serving as the sole general partner of JCF Fund II-A. JCF II-A LLC is principally engaged in the business of serving as the sole general partner of JCF II-A L.P. FSO L.P. is principally engaged in the business of serving as the sole general partner of FSO. FSO Ltd. is principally engaged in the business of

serving as the sole general partner of FSO L.P. J. Christopher Flowers is the sole managing member of JCF II-A LLC and the sole director of JCF II Ltd. and FSO Ltd. and thus may be deemed to control JCF II-A LLC, JCF II Ltd. and FSO Ltd. and each entity directly or indirectly controlled by JCF II-A LLC, JCF II Ltd. and FSO Ltd.

(d) and (e) During the last five years, none of the Reporting Persons has been convicted in a criminal proceeding (excluding traffic violations or similar misdemeanors) or has been a party to a civil proceeding of a judicial or administrative body of competent jurisdiction as a result of which he, she or it was or is subject to a judgment, decree or final order enjoining future violations of, or prohibiting activities subject to, federal or state securities laws or finding any violation of such laws.

(f) JCF Fund II, JCF Fund II-B, JCF II L.P., JCF II Ltd., FSO, FSO L.P. and FSO Ltd. are organized under the laws of the Cayman Islands. JCF Fund II-A is organized under the laws of Alberta, Canada. JCF II-A L.P. and JCF II-A LLC are organized under the laws of Delaware. Mr. Flowers is a citizen of the United States of America.

Item 3.

Source and Amount of Funds or Other Consideration

On May 20, 2008, JCF Fund II entered into an Investment Agreement with the Issuer (the “Investment Agreement”), and on June 10, 2008, JCF Fund II entered into Amendment No.1 to the Investment Agreement with the Issuer (the “Amendment” and, together with the Investment Agreement, the “Amended Investment Agreement”), wherein, among other things, (i) JCF Fund II agreed to purchase, or to cause its affiliates to purchase, not less than 1,500,000 and not more than 3,000,000 Series A Preference Shares at a purchase price and liquidation preference of $100.00 per Series A Preference Share (the “Backstop Commitment”), and (ii) the Issuer agreed to pay a fee in cash to JCF Fund II in exchange for the Backstop Commitment (the “Commitment Fee”). Prior to the Closing Date, the Issuer had the right to issue and sell Series A Preference Shares or other securities in one or more private placements and/or offerings on terms no more favorable to the purchasers than those relating to the purchase pursuant to the Backstop Commitment.

Pursuant to the Amended Investment Agreement, the Issuer agreed, in the event that prior to the first anniversary of the Closing Date it sold Common Stock or securities convertible into or exercisable for Common Stock at a price less than $12.50 (subject to limited exceptions), to pay to JCF Fund II an amount (in cash or shares of Common Stock) reflecting the difference in pricing (a “Make-Whole Payment”). In addition, the Issuer agreed, in the event that prior to the first anniversary of the Closing Date (or in any offering required under any future bank financings) it sold any other series of its preferred stock with a dividend rate above 5.45%, to adjust the dividend rate on the Series A Preference Shares beneficially owned by JCF Fund II or its affiliates so as to equal 110% of the dividend rate of such series of preference shares (an “Incremental Dividend Adjustment”). On June 25, 2008, as reported by the Issuer on a Current Report on Form 8-K dated June 26, 2008, the Issuer issued and sold (i) $150 million aggregate principal amount of its 9.00% Convertible Senior Notes due 2038 and (ii) $150 million in aggregate liquidation preference of its 9.75% Non-Cumulative Convertible Preference Shares, Series B. As a result of the issuance of these securities, the Issuer agreed (a) to pay to JCF Fund II and its affiliates on the Closing Date, in the form of a reduction of the amount otherwise payable by JCF Fund II and its affiliates on such date, Make-Whole Payments (including an amount in respect of the overall terms on which these other securities were issued) in an aggregate amount of $36.3 million

(the “July Make-Whole Amount”) and (b) to increase the dividend rate on the Series A Preference Shares held by JCF Fund II or its affiliates to 10.725% (the “July Incremental Dividend Adjustment”). These matters were memorialized in letter agreements between the Issuer and JCF Fund II dated June 27, 2008 (the “June Letter Agreement”) and July 17, 2008 (the “July Letter Agreement”).

On July 18, 2008 (the “Closing Date”), pursuant to the Amended Investment Agreement, (i) JCF Fund II paid an aggregate purchase price of $106,729,100 to acquire 1,067,291 Series A Preference Shares, (ii) JCF Fund II-A paid an aggregate purchase price of $6,732,200 to acquire 67,322 Series A Preference Shares, (iii) JCF Fund II-B paid an aggregate purchase price of $6,538,700 to acquire 65,387 Series A Preference Shares and (iv) FSO paid an aggregate purchase price of $30,000,000 to acquire 300,000 Series A Preference Shares.

Such purchase price amounts were funded by (i) funds obtained from the respective JCF Fund’s equity partners pursuant to commitments made by such equity partners for the purpose of making private equity and related investments, (ii) the Commitment Fee, and (iii) the July Make-Whole Amount.

The foregoing description of the Investment Agreement, the Amendment, the June Letter Agreement or the July Letter Agreement is not intended to be complete and is qualified in its entirety by reference to the full text of such agreements, copies of which are attached as Exhibit 7.01, Exhibit 7.02, Exhibit 7.03 and Exhibit 7.04, respectively, to this Statement, and which are incorporated herein by reference.

Item 4.

Purpose of Transaction

As described more fully above, pursuant to the terms of the Amended Investment Agreement, on the Closing Date, the JCF Funds purchased a total of 1,500,000 Series A Preference Shares (the “Purchase”).

The JCF Funds acquired the Series A Preference Shares because of the belief that the Series A Preference Shares represent an attractive investment. The Reporting Persons beneficially own the Series A Preference Shares for investment purposes.

On the Closing Date, the Issuer filed a current report on Form 8-K stating that the Purchase had closed. The Issuer stated therein that the net proceeds from the Purchase were used to repay a portion of the Issuer’s bridge loan facility pursuant to its capital plan. The Purchase and the Amended Investment Agreement did or may result in one or more of the actions specified in clauses (a)-(j) of Item 4 of Schedule 13D promulgated under the Exchange Act, including the acquisition or disposition of additional securities of the Issuer, a change to the present board of directors of the Issuer or a change to the present capitalization or dividend policy of the Issuer, as briefly described below.

The responses set forth in Item 3 are incorporated by reference in their entirety.

Amended Investment Agreement

Pursuant to the terms of the Amended Investment Agreement, JCF Fund II has designated Mr. David Schamis to be appointed to the board of directors of the Issuer and the

Issuer is obligated to take all corporate and other actions necessary, including increasing the size of the board of directors of the Issuer, as applicable, to appoint Mr. Schamis to the board of directors of the Issuer promptly following the Issuer’s annual meeting of its members currently scheduled for the date hereof. Subject to certain share ownership requirements described in the Amended Investment Agreement, the Issuer will be required to take all corporate and other actions necessary, including increasing the size of the board of directors of the Issuer, as applicable, to nominate up to two directors designated by JCF Fund II at each annual meeting of its members after the annual meeting currently scheduled for the date hereof and to use its reasonable best efforts to cause such nominees to be elected.

Series A Preference Shares

The Series A Series A Preference Shares held by the JCF Funds are convertible at any time (as described in Section 7 of the Certificate of Designations) at an initial conversion rate of 8 shares of Common Stock per Preference Share (subject to adjustment). In connection with any conversion, the holders of the Series A Preference Shares are entitled to receive any accumulated, unpaid dividends on the Series A Preference Shares.

As set forth in the Certificate of Designations, dividends on the Series A Preference Shares are payable quarterly, on a cumulative basis, if, as and when declared by the Issuer’s board of directors out of legally available funds, commencing with the dividend period relating to the dividend payment date on August 15, 2008, at an annual rate of 6% of the liquidation preference of the Series A Preference Shares (as adjusted by the July Incremental Dividend Adjustment and any additional Incremental Dividend Adjustments with respect to the Series A Preference Shares beneficially owned by JCF Fund II and its affiliates). Holders of the Series A Preference Shares are entitled to participate in any dividends (other than dividends in shares of Common Stock) paid on the shares of Common Stock, on an as-converted basis. The Issuer may pay quarterly dividends in the form of cash or shares of Common Stock (valued at 95% of the then-current market value), at its option. Dividends that are not declared and paid accumulate and accrue dividends at the annual rate of 6% (as adjusted by the July Incremental Dividend Adjustment and any additional Incremental Dividend Adjustments with respect to the Series A Preference Shares beneficially owned by JCF Fund II and its affiliates). The Issuer is prohibited from paying any dividend with respect to shares of Common Stock and from repurchasing or redeeming shares of Common Stock or other junior securities, subject to certain exceptions, unless full accumulated dividends are paid on the Series A Preference Shares.

Holders of the Series A Preference Shares are entitled to vote with the holders of Common Stock on all matters submitted to a vote of the holders of Common Stock, which includes the right to vote for the election of directors at any annual meeting, voting together with the common shareholders as a single class on an as-converted basis. Holders of the Series A Preference Shares are also entitled to vote, to the exclusion of the holders of Common Stock, on certain matters that affect the rights and privileges of the Series A Preference Shares. Holders of the Series A Preference Shares have the right, together with other parity securities having similar voting rights, to elect two directors if dividends have not been paid in full for six quarterly dividend periods.

In the event of any liquidation, dissolution or winding up of the Issuer, the holders of Series A Preference Shares will have the right to receive a liquidation distribution out of any assets available for distribution after payments to creditors, and before any distribution in

respect of shares of Common Stock, in an amount equal to the greater of (1) the liquidation preference amount ($100 per share plus accumulated and unpaid dividends) and (2) the amount such holders would receive if they had converted their Series A Preference Shares into common shares prior to liquidation.

The foregoing description of the Certificate of Designations is not intended to be complete and is qualified in its entirety by reference to the full text of the Certificate of Designations, a copy of which is attached as Exhibit 7.05 to this Statement, and which is incorporated herein by reference.

Registration Rights Agreement

On the Closing Date, the Issuer entered into a Registration Rights Agreement (the “Registration Rights Agreement “), with JCF Fund II, with respect to the Series A Preference Shares beneficially owned by the Reporting Persons, the shares of Common Stock into which such Preference Shares may be converted and the shares of Common Stock issued by the Issuer upon payment of dividends in respect of such Preference Shares (collectively, the “Registrable JCF Securities”). Under the Registration Rights Agreement, the Issuer has agreed, subject to certain exceptions, upon JCF Fund II’s request, to file registration statements to cover the resale of the Registrable JCF Securities. The Registration Rights Agreement also entitles JCF Fund II to register the Registrable JCF Securities if the Issuer files registration statements to register shares of Common Stock or any other of the Issuer’s securities, either on its own accord or at the request of another holder.

The foregoing description of the Registration Rights Agreement is not intended to be complete and is qualified in its entirety by reference to the full text of the Registration Rights Agreement, a copy of which is attached as Exhibit 7.06 to this Statement, and which is incorporated herein by reference.

Additional Disclosure

Each of the Reporting Persons reserves the right, in light of its ongoing evaluation of the Issuer’s financial condition, business, operations and prospects, the price and availability of the Issuer’s capital stock, conditions in the securities market generally, general economic and industry conditions, its business objectives and other relevant factors, to increase or decrease their investment in the Issuer from time to time. In particular, any one or more of the Reporting Persons (and their respective affiliates) reserves the right, in each case subject to the terms of the Amended Investment Agreement, the Certificate of Designations and any applicable law, to (i) purchase additional shares of securities of the Issuer, (ii) sell or transfer Series A Preference Shares or shares of Common Stock or other securities of the Issuer beneficially owned by them from time to time in public or private transactions, (iii) cause any of the Reporting Persons to distribute in kind to their respective partners or members, as the case may be, Series A Preference Shares or shares of Common Stock or other securities of the Issuer beneficially owned by it from time to time, (iv) enter into privately negotiated derivative transactions with institutional counterparties to hedge the market risk of some or all of their positions in the Series A Preference Shares, shares of Common Stock or other securities of the Issuer and (v) consider participating in business combination transactions involving the Issuer.

Item 5.

Interest in Securities of the Issuer

(a) The Reporting Persons collectively own 1,500,000 Series A Preference Shares, representing 100% of the outstanding Series A Preference Shares. As of the date hereof, subject to the terms of the Certificate of Designations, such Series A Preference Shares are convertible into 12,000,000 shares of Common Stock, representing approximately 9.1% of the shares of Common Stock outstanding (based on the 119,647,222 shares of Common Stock outstanding as of March 31, 2008, as reported in Issuer’s Form 10-K filed on June 13, 2008 and the 12,000,000 shares of Common Stock issuable upon conversion of the Series A Preference Shares (the “Outstanding Common Stock Denominator”)). As noted in Item 4 above, in connection with any conversion, the holders of the Series A Preference Shares are entitled to receive any accumulated, unpaid dividends on the Series A Preference Shares, which are payable, at the option of the Issuer, in the form of cash or shares of Common Stock (valued at 95% of the then-current market value).

JCF Fund II has direct beneficial ownership of 1,067,291 Series A Preference Shares, or 71.2% of the Series A Preferred Stock, which, as of the date hereof, are convertible into 8,538,328 shares of Common Stock, or 6.5% of the outstanding shares of Common Stock (based on the Outstanding Common Stock Denominator).

JCF Fund II-A has direct beneficial ownership of 67,322 Series A Preference Shares, or 4.5% of the Series A Preferred Stock, which, as of the date hereof, are convertible into 538,576 shares of Common Stock, or 0.4% of the outstanding shares of Common Stock (based on the Outstanding Common Stock Denominator).

JCF Fund II-B has direct beneficial ownership of 65,387 Series A Preference Shares, or 4.4% of the Series A Preferred Stock, which, as of the date hereof, are convertible into 523,096 shares of Common Stock, or 0.4% of the outstanding shares of Common Stock (based on the Outstanding Common Stock Denominator).

FSO has direct beneficial ownership of 300,000 Series A Preference Shares, or 20.0% of the Series A Preferred Stock, which, as of the date hereof, are convertible into 2,400,000 shares of Common Stock, or 1.8% of the outstanding shares of Common Stock (based on the Outstanding Common Stock Denominator).

Each of (i) JCF II L.P., as the general partner of JCF Fund II and JCF Fund II-B, (ii) JCF II Ltd., as the general partner of JCF II L.P., (iii) JCF II-A L.P. , as the general partner of JCF Fund II-A, (iv) JCF II-A LLC , as the general partner of JCF II-A L.P., (v) FSO L.P., as the general partner of FSO, (vii) FSO Ltd., as the general partner of FSO L.P. and (viii) Mr. J. Christopher Flowers, as (A) the sole director of JCF II Ltd and FSO Ltd. and (B) the sole managing member of JCF II-A LLC, may be deemed to share beneficial ownership, or to hold shared voting or dispositive power, of Series A Preference Shares. Except to the extent of any indirect pecuniary interest therein, each of the Reporting Persons listed in clauses (i) through (viii) of the immediately preceding sentence, expressly disclaims the existence of beneficial ownership in such Series A Preference Shares.

Except as described in this Item 5(a), no person listed in Item 2 of this Statement is a beneficial owner of the shares of Common Stock or the Series A Preference Shares in which the JCF Funds have beneficial ownership.

(b) See Item 5(a) above.

(c) The JCF Funds acquired an aggregate of 1,500,000 Series A Preference Shares on July 18, 2008 pursuant to the Amended Investment Agreement. Descriptions of the investment by the JCF Funds and the securities related thereto are included in Item 3 and Item 4 of this Statement.

(d) Not applicable.

(e) Not applicable.

Item 6.

Contracts, Arrangements, Understandings or Relationships with Respect to Securities of the Issuer

Pursuant to Rule 13d-1(k) promulgated under the Exchange Act, the Reporting Persons have entered into an agreement on July 28, 2008, with respect to the joint filing of this Statement and any amendment or amendments hereto (the “Joint Filing Agreement”). The Joint Filing Agreement is attached hereto as Exhibit 1 and incorporated herein by reference.

The responses set forth in Item 4 are incorporated by reference in their entirety.

Except as referenced above or as described in Item 4 hereof, there are no contracts, arrangements, understandings or relationships among the persons named in Item 2 or between such persons and any other person with respect to the securities of the Issuer.

Item 7.

Material to Be Filed as Exhibits


Exhibit 1		Joint Filing Agreement, dated as of July 28, 2008, by and among J.C. Flowers II L.P., J.C. Flowers II-A L.P., J.C. Flowers II-B L.P., Financial Service Opportunities L.P., JCF Associates II L.P., JCF Associates II Ltd., JCF Associates II-A L.P., JCF Associates II-A LLC, FSO GP L.P., FSO GP Ltd. and J. Christopher Flowers.

Exhibit 7.01		Investment Agreement, dated as of May 20, 2008, between MF Global Ltd. and J.C. Flowers II L.P.

Exhibit 7.02		Amendment No.1 to the Investment Agreement, dated as of June 10, 2008, between MF Global Ltd. and J.C. Flowers II L.P.

Exhibit 7.03		Letter Agreement, dated as of June 27, 2008, between MF Global Ltd. and J.C. Flowers II L.P.

Exhibit 7.04		Letter Agreement, dated as of July 17, 2008, between MF Global Ltd. and J.C. Flowers II L.P.

Exhibit 7.05		Certificate of Designations of 6% Cumulative Convertible Preference Shares, Series A of MF Global Ltd.

Exhibit 7.06		Registration Rights Agreement, dated as of July 18, 2008, between MF Global Ltd. and J.C. Flowers II L.P.

SIGNATURE

After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct.

Dated: July 28, 2008


J.C. FLOWERS II L.P.
By:		JCF Associates II L.P., its General Partner
By:		JCF Associates II Ltd., its General Partner

By:		/s/ Kristin H. Johnson
		Name: Kristin H. Johnson
		Title: Vice President

J.C. FLOWERS II-A L.P.
By:		JCF Associates II-A L.P., its General Partner
By:		JCF Associates II-A LLC, its General Partner

By:		/s/ J. Christopher Flowers
		Name: J. Christopher Flowers
		Title: Managing Director

J.C. FLOWERS II-B L.P.
By:		JCF Associates II L.P., its General Partner
By:		JCF Associates II Ltd., its General Partner

By:		/s/ Kristin H. Johnson
		Name: Kristin H. Johnson
		Title: Vice President

FINANCIAL SERVICE OPPORTUNITIES L.P.
By:		FSO GP L.P., its General Partner
By:		FSO GP Ltd., its General Partner

By:		/s/ J. Christopher Flowers
		Name: J. Christopher Flowers
		Title: Managing Director

JCF ASSOCIATES II L.P.
By:		JCF Associates II Ltd., its General Partner

By:		/s/ Kristin H. Johnson
		Name: Kristin H. Johnson
		Title: Vice President


JCF ASSOCIATES II LTD.

By:		/s/ Kristin H. Johnson
		Name: Kristin H. Johnson
		Title: Vice President

JCF ASSOCIATES II-A L.P.
By:		JCF Associates II-A LLC, its General Partner

By:		/s/ J. Christopher Flowers
		Name: J. Christopher Flowers
		Title: Managing Director

JCF ASSOCIATES II-A LLC

By:		/s/ J. Christopher Flowers
		Name: J. Christopher Flowers
		Title: Managing Director

FSO GP L.P.
By:		FSO GP Ltd., its General Partner

By:		/s/ J. Christopher Flowers
		Name: J. Christopher Flowers
		Title: Managing Director

FSO GP LTD.

By:		/s/ J. Christopher Flowers
		Name: J. Christopher Flowers
		Title: Managing Director

J. CHRISTOPHER FLOWERS

By:		/s/ J. Christopher Flowers

EX-1 2 dex1.htm JOINT FILING AGREEMENT Joint Filing Agreement

Exhibit 1

Joint Filing Agreement

Pursuant to Rule 13d-1(k) promulgated under the Securities Exchange Act of 1934, as amended, the undersigned agree that the Statement on Schedule 13D to which this exhibit is attached is filed on behalf of each of them in the capacities set forth below.

Dated: July 28, 2008


J.C. FLOWERS II L.P.
By:		JCF Associates II L.P., its General Partner
By:		JCF Associates II Ltd., its General Partner

By:		/s/ Kristin H. Johnson
		Name: Kristin H. Johnson
		Title: Vice President

J.C. FLOWERS II-A L.P.
By:		JCF Associates II-A L.P., its General Partner
By:		JCF Associates II-A LLC, its General Partner

By:		/s/ J. Christopher Flowers
		Name: J. Christopher Flowers
		Title: Managing Director

J.C. FLOWERS II-B L.P.
By:		JCF Associates II L.P., its General Partner
By:		JCF Associates II Ltd., its General Partner

By:		/s/ Kristin H. Johnson
		Name: Kristin H. Johnson
		Title: Vice President


FINACIAL SERVICE OPPORTUNITIES L.P.
By:		FSO GP L.P., its General Partner
By:		FSO GP Ltd., its General Partner

By:		/s/ J. Christopher Flowers
		Name: J. Christopher Flowers
		Title: Managing Director

JCF ASSOCIATES II L.P.
By:		JCF Associates II Ltd., its General Partner

By:		/s/ Kristin H. Johnson
		Name: Kristin H. Johnson
		Title: Vice President

JCF ASSOCIATES II LTD.

By:		/s/ Kristin H. Johnson
		Name: Kristin H. Johnson
		Title: Vice President

JCF ASSOCIATES II-A L.P.
By:		JCF Associates II-A LLC, its General Partner

By:		/s/ J. Christopher Flowers
		Name: J. Christopher Flowers
		Title: Managing Director

JCF ASSOCIATES II-A LLC

By:		/s/ J. Christopher Flowers
		Name: J. Christopher Flowers
		Title: Managing Director

FSO GP L.P.
By:		FSO GP Ltd., its General Partner

By:		/s/ J. Christopher Flowers
		Name: J. Christopher Flowers
		Title: Managing Director


FSO GP LTD.

By:		/s/ J. Christopher Flowers
		Name: J. Christopher Flowers
		Title: Managing Director

J. CHRISTOPHER FLOWERS

By:		/s/ J. Christopher Flowers

EX-7.01 3 dex701.htm INVESTMENT AGREEMENT Investment Agreement

Exhibit 7.01

INVESTMENT AGREEMENT

dated as of May 20, 2008

between

MF GLOBAL LTD.

and

J.C. FLOWERS II L.P.

TABLE OF CONTENTS


		Page
Recitals:		1
	Article I Other Offerings; Backstop; Closing

1.1	Other Offerings	1
1.2	Backstop	3
1.3	Closing	3
1.4	Interpretation	3
	Article II Representations and Warranties

2.1	Disclosure	3
2.2	Representations and Warranties of the Company	4
2.3	Representations and Warranties of the Investor	12
	Article III Covenants

3.1	Reasonable Best Efforts	13
3.2	Expenses	13
3.3	Publicity	13
3.4	Sufficiency of Outstanding Common Shares	13
3.5	Withholding of Tax	13
3.6	Anti-Trust Clearance	13
3.7	Investor Representatives	14
3.8	Directors	15
3.9	Conduct of Business	15
3.10	Certain Tax Matters	17
3.11	Certain Adjustments	17

- i -


	Article IV Additional Agreements of the Investor
4.1	Standstill Agreement	18
4.2	Lock-Up	20
4.3	Transfer Restrictions	20
4.4	Purchase for Investment	21
4.5	Legend	21
4.6	Indemnity	22
	Article V Miscellaneous
5.1	Survival	24
5.2	Termination	24
5.3	Amendment	24
5.4	Waiver of Conditions	24
5.5	Expenses	24
5.6	Counterparts and Facsimile	24
5.7	GOVERNING LAW; SUBMISSION TO JURISDICTION, ETC.	24
5.8	Remedies	25
5.9	Notices	25
5.10	Entire Agreement, Etc.	26
5.11	Definitions of “subsidiary” and “Affiliate”	26
5.12	Severability	27
5.13	No Third-Party Beneficiaries	27

- ii -

LIST OF ANNEXES


Annex A		Purchased Securities

Annex B		Certificate of Designations

Annex C		Registration Rights Agreement

Annex D		Form of Opinion of Conyers Dill & Pearman

Annex E		Form of Opinion of Sullivan & Cromwell LLP

Annex F		Bank Financing/Other Debt Financing

Annex G		Current Report of Form 8-K

Annex H		Amendment of Rights Agreement

Annex I		Investor Representative Letter of Resignation

Annex J		Form of Assignment

LIST OF SCHEDULES


Schedule 1.3(c)		Company Regulatory Approvals

Schedule 2.2(b)(ii)		Obligations to Sell or Issue Equity

Schedule 2.2(b)(iii)		Registration Rights

Schedule 2.2(g)		Proceedings

Schedule 2.2(h)		Unauthorized Trading Matters

Schedule 2.2(i)		Liabilities and Obligations

Schedule 2.2(j)		Material Adverse Changes

Schedule 2.2(m)		Property and Leases

Schedule 2.2(p)		Agreements with Regulatory Entities

Schedule 2.2(r)		Tax Matters

Schedule 2.3(b)(iii)		Investor Regulatory Approvals

Schedule 3.7		Investor Representatives

Schedule 4.3(b)		Competitors

Schedule 5.5		Expenses

- iii -

INDEX OF DEFINED TERMS


Term		Location of Definition
Actual Number		Recitals
Affiliate		5.11(b)
Agreement		Preamble
Bankruptcy Exceptions		2.2(d)(i)
beneficial ownership; beneficially owned		4.1(d)
Certificate of Designations		Recital B
Change of Control		4.1(c)
Closing		1.3(a)
Closing Date		1.3(a)
Code		2.2(r)(vii)
Commission		2.1(c)
Common Shares		Recital A
Company		Preamble
Company Financial Statements		2.2(h)(iii)
Company Plan		2.2(s)(i)
Company Reports		2.2(h)(i)
Competitor		4.3(b)
Current 8-K Report		2.1(c)
De Minimis Claim		4.6(e)
Equity Securities		4.1(d)
ERISA		2.2(s)(i)
Exchange Act		2.1(c)
Form S-1		2.1(c)
GAAP		2.2(i)
Hedging Transaction		4.2
HSR Act		3.6
IPO Registration Statement		2.1(c)
Intellectual Property		2.2(l)
Indemnified Party		4.6(c)
Indemnifying Party		4.6(c)
Investor		Preamble
Investor Material Adverse Effect		2.3(b)(ii)
Investor Representative		3.7
IRS		1.3(d)(ii)
Lock-Up Period		4.2
Losses		4.6(a)
Material Adverse Effect		2.2(a)
Maximum Number		Recitals
Minimum Number		Recitals
Money Laundering Laws		2.2(o)(iv)
NYSE		1.3(c)
Offering		1.1
One Director Amount		3.7(a)
Permitted Transferee		4.3(b)(ii)
PFIC		2.2(r)(ix)
PFIC Annual Information Statement		3.10(c)
Pre-Closing Period		3.9
Publicly Disclosed Information		2.1(c)
Purchase		1.2
Purchased Securities		1.2
QEF Election		3.10(c)


Registration Agreement		1.3(b)
Regulatory Agreement		2.2(p)
Regulatory Entities		1.3(c)
Sarbanes-Oxley Act		2.2(o)(iii)
SEC Filings		2.1(c)
SEC Reports		2.1(c)
Securities Act		2.2(a)
Series A Shares		Recital B
Significant Subsidiary; Significant Subsidiaries		2.2(a)
Standstill Termination Event		4.1(c)
subsidiary		5.11(a)
Tax		2.2(r)(ix)
Tax Returns		2.2(r)(ix)
Threshold Amount		4.6(e)
Transaction Documents		Recital B
Transfer		4.3(a)
Transfer Notice		4.3(b)
Two Director Amount		3.7(a)
Voting Shares		4.1(d)

- iv -

INVESTMENT AGREEMENT, dated May 20, 2008 (this “Agreement”), between MF Global Ltd., a Bermuda exempted company (the “Company”), and J.C. Flowers II L.P.(the “Investor”).

RECITALS:

A. The Company. As of the date hereof, the Company has (i) 1,000,000,000 authorized common shares, $1.00 par value per share (“Common Shares”), of which, as of April 30, 2008 120,046,739 shares were issued and outstanding; and (ii) 200,000,000 authorized preference shares, $1.00 par value per share, of which no shares are outstanding.

B. The Issuances. The Company currently intends (i) to issue and sell an amount of a series of its preference shares having the designation, powers, preferences and rights set forth in a certificate of designations in the form attached as Annex B (the “Certificate of Designations” and such series of preference shares, the “Series A Shares”) in one or more private placements and/or public offerings and (ii) to issue and sell to the Investor, and the Investor intends to purchase from the Company, a number (the “Actual Number”) of Series A Shares equal to (x) the maximum number specified in Annex A (the “Maximum Number”) minus (y) such number, if any, as may be issued and sold in any offerings of the kind referenced in clause (i) above; provided that the Actual Number shall not be less than the minimum number specified in Annex A (the “Minimum Number”). For purposes of this Agreement, the term “Transaction Documents” refers collectively to this Agreement, the Registration Agreement (as hereinafter defined) and the Certificate of Designations, in each case as amended, modified or supplemented from time to time in accordance with their respective terms.

NOW, THEREFORE, in consideration of the premises, and of the representations, warranties, covenants and agreements set forth herein, the parties agree as follows:

Article I

OTHER OFFERINGS; BACKSTOP; CLOSING

1.1 Other Offerings. The Company has the right to issue and sell Series A Shares in one or more private placements and/or public offerings from time to time and at any time after the date hereof but before the Closing Date on such terms and conditions as it shall determine in its sole discretion (each such transaction, an “Offering”); provided that the terms and conditions of any Offering taken as a whole shall not be more favorable to the purchasers than those relating to the Purchase (as defined below) and the aggregate number of Series A Shares issued in such Offerings and the Purchased Securities shall not be greater than 7,500,000.

1.2 Backstop. On the terms and subject to the conditions set forth in this Agreement, the Company agrees to sell to the Investor, and the Investor agrees to purchase from the Company, at the Closing (as hereinafter defined), the Actual Number of Series A Shares at an aggregate purchase price calculated by multiplying such number by the price per share specified on Annex A, subject to adjustment as provided in Section 1.3(b) (the “Purchase”). The Series A Shares to be purchased by the Investor pursuant to this Section 1.2 are herein called the “Purchased Securities”.

1.3 Closing.

(a) On the terms and subject to the conditions set forth in this Agreement, the closing of the Purchase (the “Closing”) will take place at a location mutually agreed to by the parties hereto at 10:00 a.m., New York time, on the earlier of (i) July 31, 2008 or (ii) the date five business days after the receipt by the Investor of a notice from the Company that all conditions precedent set forth in Section 1.3(e) have been satisfied or waived, but in no event earlier than June 30 2008, or at such other place, time and date as shall be agreed between the Company and the Investor. The time and date on which the Closing occurs is referred to in this Agreement as the “Closing Date”.

(b) Subject to the fulfillment or waiver of the conditions to the Closing in Sections 1.3(c) and (d), at the Closing, (i) the Company will deliver to the Investor the Purchased Securities, as evidenced by one or more certificates dated the Closing Date and bearing appropriate legends as hereinafter provided for, registered in the register of members of the Company in such Investor’s name and (ii) the Purchaser will deliver to the Company by wire transfer of immediately available United States funds to a bank account that has been designated by the Company no later than two business days prior to the Closing Date an amount equal to (x) the product of the number of Purchased Securities multiplied by the price per Series A Share specified on Annex A less (y) an amount equal to 3.0% of the product of (A) the price per Series A Share specified on Annex A multiplied by (B) the difference between the Maximum Number and the Actual Number. Each of the Company and the Investor agree to execute and deliver to the other party at Closing a Registration Rights Agreement (the “Registration Agreement”) in the form of Annex C.

- 1 -

(c) The respective obligations of each of the Investor and the Company to consummate the Closing is subject to the fulfillment (or written waiver by the Investor or the Company, as applicable) prior to the Closing of the condition that (i) any approvals or authorizations of or notices to (or expiration of any applicable waiting periods of) the governmental and self-regulatory authorities, domestic and foreign, having jurisdiction over the Company and its subsidiaries (collectively, “Regulatory Entities”) specified on Schedule 1.3(c) have been received or made (or occurred) as applicable, (ii) the Company shall have been advised by the NYSE that the Common Shares issuable upon conversion of the Purchased Securities will be listed on the New York Stock Exchange (“NYSE”), subject to official notice of issuance and (iii) there shall be no effective injunction, writ, preliminary restraining order or any order of any nature issued by a court of competent jurisdiction directing that the transactions provided for herein or any of them not be consummated as herein provided.

(d) The obligation of the Company to consummate the Closing is also subject to the fulfillment (or waiver by the Company) at or prior to the Closing of each of the following conditions:

(i) (A) the representations and warranties of the Investor set forth in this Agreement shall be true and correct (without regard to “materiality” or “Material Adverse Effect” qualifications included therein) as though made on and as of the Closing Date (other than representations and warranties that by their terms speak as of another date, which representations and warranties shall be true and correct as of such other date) except to the extent that the failure of such representations and warranties to be so true and correct, individually or in the aggregate, does not have and would not reasonably be expected to have an Investor Material Adverse Effect, (B) the Investor shall have performed in all material respects all obligations required to be performed by it under this Agreement at or prior to the Closing and (C) the Company shall have received a certificate, dated the Closing Date, signed by an executive officer of the Investor, certifying on behalf of the Investor that the conditions specified in the foregoing clauses (A) and (B) have been fulfilled;

(ii) the Company shall have received from the Investor a duly executed, valid, accurate and properly completed Internal Revenue Service (the “IRS”) Form W-9 or an appropriate IRS Form W-8 evidencing the Investor’s entitlement to an exemption from backup withholding; and

(iii) the Investor shall have duly executed and delivered to the Company the Registration Agreement.

(e) The obligation of the Investor to consummate the Closing is also subject to the fulfillment (or waiver by the Investor) at or prior to the Closing of each of the following conditions:

(i) (A) the representations and warranties of the Company set forth in clause (3) of Section 2.2(j) shall be true and correct in all respects as of the Closing Date as though made on and as of the Closing Date, (B) except for the representations and warranties of the Company set forth in clause (3) of Section 2.2(j), each of the representations and warranties of the Company set forth in this Agreement shall be true and correct (without regard to “materiality” or “Material Adverse Effect” qualifications included therein) as of the Closing Date as though made on and as of the Closing Date (other than representations and warranties that by their terms speak as of another date, which representations and warranties

shall be true and correct as of such other date), except to the extent that the failure of such representations and warranties to be so true and correct, individually or in the aggregate, does not have and would not reasonably be expected to have a Material Adverse Effect, (C) the Company shall have performed in all material respects all obligations required to be performed by it under this Agreement at or prior to the Closing and (D) the Investor shall have received a certificate, dated the Closing Date, signed by the Chief Executive Officer or the Chief Financial Officer of the Company, certifying on behalf of the Company that the conditions specified in the foregoing clauses (A), (B) and (C) have been fulfilled;

(ii) the Company shall have duly executed and delivered to the Investor the Registration Agreement;

(iii) the Investor shall have received from Conyers Dill & Pearman and/or Sullivan & Cromwell LLP, counsel for the Company in Bermuda and the U.S. respectively, legal opinions addressed to the Investor, dated as of the Closing Date, in the forms attached as Annexes D and E, respectively; and

(iv) On or before the Closing Date, the Company shall have received debt and/or equity financing in an aggregate amount equal to at least $750,000,000 minus the amount of proceeds from the sale of the Purchased Securities to the Investor, from one or more financial institutions or other persons pursuant to credit or other agreements, in public and/or private offerings of senior,

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subordinated or convertible debt, common, convertible preferred or preferred equity or rights to acquire any of the foregoing or otherwise, provided that (1) to the extent such financing involves bank financing (or any financing pursuant to a credit or similar agreement), such bank financing shall have terms that in the aggregate are no less favorable to the Company than the terms contemplated in Annex F – Bank Financing, (2) to the extent such financing involves other debt financing, such other debt financing shall have terms that in the aggregate are no less favorable to the Company than the terms contemplated in Annex F – Other Debt Financing, and (3) to the extent such financing involves equity financing the Investor shall be entitled to any adjustment under Section 3.11 that may apply in respect of such equity financing. For the avoidance of doubt, convertible debt shall be treated as other debt financing and equity financing and shall be subject to both clause (2) and clause (3) above. The financing to be received by the Company as provided in the first sentence of this clause (iv) must either be received by the Company at or prior to the Closing or all the conditions to the lenders’ (or investors’) obligations to provide such financing (other than a condition that the Closing shall have occurred) must be satisfied or waived at or prior to the Closing.

It is understood and agreed that the Company intends to issue and sell additional Series A Shares in connection with one or more Offerings concurrently with or shortly before the Closing. The consummation of any such Offering shall not be a condition to the obligations of the Investor under this Agreement.

1.4 Interpretation. When a reference is made in this Agreement to “Recitals,” “Articles,” “Sections” or “Annexes,” such reference shall be to a Recital, Article or Section of, or Annex to, this Agreement unless otherwise indicated. The terms “herein”, “hereof”, “hereto” and the like refer to this Agreement in its entirety. The terms defined in the singular have a comparable meaning when used in the plural, and vice versa. The table of contents and headings contained in this Agreement are for reference purposes only and are not part of this Agreement. Whenever the words “include,” “includes” or “including” are used in this Agreement, they shall be deemed followed by the words “without limitation.” No rule of construction against the draftsperson shall be applied in connection with the interpretation or enforcement of this Agreement, as this Agreement is the product of negotiation between sophisticated parties advised by counsel. All references to “$” or “dollars” mean the lawful currency of the United States of America. Except as expressly stated in this Agreement, all references to any statute, rule or regulation are to the statute, rule or regulation as amended, modified, supplemented or replaced from time to time (and, in the case of statutes, include any rules and regulations promulgated under the statute) and include any successor or analogous statute, rule or regulation that replaces the same.

Article II

REPRESENTATIONS AND WARRANTIES

2.1 Disclosure.

(a) Investor’s Review. The Investor acknowledges that it has conducted a review and analysis of the business, assets, financial condition, result of operations, cash plans, management and prospects of the Company and its subsidiaries that the Investor considers sufficient for purposes of deciding whether or not to make the Purchase. The Investor further acknowledges that it has had full access to all the information, and has had an opportunity to ask all the questions of and has received all the answers from the Company’s management and other representatives, regarding the Company’s business, assets, financial condition, results of operations, cash flow, management and prospects (including the events and matters referenced in the Publicly Disclosed Information), and the terms and conditions of the Purchase and the Purchased Securities, that the Investor considers necessary or appropriate for deciding whether or not to make the Purchase. In addition, in connection with the Purchase, the Investor has had such opportunity to consult with its own counsel, tax advisers and other professional advisers as the Investor believes is appropriate.

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(b) Investor’s Non-Reliance. The Investor acknowledges and agrees that neither the Company or any of its Affiliates, nor any person representing the Company or any of its Affiliates, has made to the Investor or any of its representatives, and the Investor is not relying upon, any representation, warranty or agreement with respect to the Company, the Purchase, the Purchased Securities or the Common Shares issuable upon conversion of the Purchased Securities, other than the representations, warranties and agreements of the Company expressly contained in this Agreement and the other Transaction Documents. Without limiting the foregoing, the Investor acknowledges that neither the Company nor any such other person has made, and the Investor is not relying upon, any representation, warranty or agreement with respect to the accuracy or completeness of the information (written or oral) provided to the Investor in connection with its prospective investment in the Purchased Securities, or with respect to the appropriateness, suitability or sufficiency of such information for the purpose of enabling the Investor to evaluate such investment, other than the representations, warranties and agreements of the Company expressly contained in this Agreement.

(c) Publicly Disclosed Information. As used herein, “Publicly Disclosed Information” means all information set forth or incorporated by reference in (i) the Company’s Registration Statement on Form F-1 (file no. 333-143395) on file with the Securities and Exchange Commission (the “Commission”) and as it became effective on July 18, 2007, together with the related final prospectus dated such date and on file with the Commission (together, the “IPO Registration Statement”), (ii) the Company’s Registration Statement on Form S-1 (file no. 333-114079) as filed with the Commission on February 5, 2008 but not declared effective by the Commission (the “Form S-1”), (iii) the Company’s quarterly and current reports on Forms 10-Q and 8-K and registration on Form 8-A filed with or furnished to the Commission under Sections 13(a), 14(a) or 15(d) of the Securities Exchange Act of 1934 (the “Exchange Act”) on or after July 18, 2007 and prior to the date hereof (collectively, the “SEC Reports”) and (iv) the Company’s draft current report on Form 8-K to be filed on or about May 20, 2008, including the draft press release included as an exhibit thereto, attached as Annex G (the “Current 8-K Report”). The Company represents and warrants that it will file the Current 8-K Report with the Commission on or about May 20, 2008 in substantially the form set forth in Annex G. The IPO Registration Statement, the Form S-1 and the SEC Reports, together with all other reports, schedules, forms, registration statements and other documents required to be filed by the Company with the SEC since January 1, 2006 and any reports, schedules, forms, registration statements and other documents required to be filed with the SEC subsequent to the date hereof, are herein collectively called the “SEC Filings”.

2.2 Representations and Warranties of the Company. The Company represents and warrants to the Investor that as of the date hereof and as of the Closing Date:

(a) Organization, Authority and Significant Subsidiaries. The Company has been duly incorporated and is validly existing as an exempted company in good standing under the laws of Bermuda, with corporate power and authority to own or lease its properties and assets and conduct its business in all material respects as currently conducted, and, except as, individually or in the aggregate, has not had or would not reasonably be expected to have a Material Adverse Effect, has been duly qualified as a foreign corporation for the transaction of business and is in good standing under the laws of each other jurisdiction in which it owns or leases properties, or conducts any business so as to require such qualification; each subsidiary of the Company that is a “significant subsidiary” within the meaning of Rule 1-01(w) of Regulation S-X under the Securities Act of 1933, as amended (the “Securities Act”) (individually a “Significant Subsidiary” and collectively the “Significant Subsidiaries”), has been duly organized and is validly existing in good standing under the laws of its jurisdiction of organization. As used herein, “Material Adverse Effect” means any event, change, development or effect that is material and adverse to the business, assets, results of operations or financial condition of the Company and its subsidiaries taken as a whole, or on the ability of the Company to consummate the Purchase and the other transactions contemplated for it by this Agreement.

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(b) Capitalization.

(i) The authorized and outstanding share capital of the Company (but without giving effect to the issuance of up to the Maximum Number of Series A Shares plus any additional Series A Shares that may be issued in the Offerings and of Common Shares issuable upon conversion thereof) is set forth in Recital A, (ii) all of the issued and outstanding Common Shares of the Company have been duly and validly authorized and issued and are fully paid and non-assessable and were not issued in violation of any preemptive rights, resale rights, rights of first refusal or similar rights and (iii) all of the issued and outstanding shares of capital stock and all other equity interests of each Significant Subsidiary have been duly and validly authorized and issued, are fully paid and non-assessable, were not issued in violation of any pre-emptive rights, resale rights, rights of first refusal or similar rights, and are owned directly or indirectly by the Company, free and clear of all liens, encumbrances, equities or claims. It is understood and agreed that the Certificate of Designations may be amended by the Company prior to Closing solely to provide that the total number of authorized Series A Shares may be increased up to 7,500,000.

(ii) Except as set forth in Schedule 2.2(b)(ii) and as contemplated by this Agreement, there are no existing options, warrants, calls, preemptive (or similar) rights, subscription or similar rights, agreements, arrangements or commitments of any character obligating the Company to issue, transfer or sell, or cause to be issued, transferred or sold, any shares of capital stock of the Company or other equity interests in the Company or any securities convertible into or exchangeable for such shares of capital stock or other equity interests, and there are no outstanding contractual obligations of the Company to repurchase, redeem or otherwise acquire any of its capital shares or other equity interests.

(iii) The Company has not made, issued or declared, and will not make, issue or declare prior to Closing, any dividends or other distributions in cash, capital stock or other property with respect to any of its capital stock. Except as contemplated by this Agreement or as set forth on Schedule 2.2(b)(iii), the Company is not, and will not be prior to Closing, a party to any agreement pursuant to which it has agreed or will agree for the benefit of any person, or granted any person the right to require the Company, to register with the Commission any securities issued by the Company held or to be held by such person.

(iv) The Common Shares are listed on the NYSE. The Company has taken no action designed to, or that is likely to have the effect of, terminating the trading of the Common Shares on the NYSE or de-registering the Company under the Exchange Act, nor has the Company received any notification that the Commission or NYSE is contemplating terminating such registration or listing.

(v) The consummation of the transactions contemplated by this Agreement and the issuance of the Series A Shares (or the Common Shares upon conversion thereof) will not trigger the anti-dilution provisions or other price adjustment mechanisms of any outstanding subscriptions, options, calls, warrants, commitments, contracts, preemptive rights, rights of first refusal, demands, conversion rights or other agreements or arrangements of any character or nature whatsoever under which the Company is or may be obligated to issue or acquire shares of any of its capital stock.

(vi) No bonds, debentures, notes or other indebtedness having the right to vote on any matters on which the stockholders of the Company may vote are issued and outstanding.

(c) The Purchased Securities. The Purchased Securities and the Common Shares issuable upon conversion of the Purchased Securities are duly authorized by all necessary corporate action on the part of the Company and, when issued and delivered as provided in this Agreement, will be duly and validly issued, fully paid and nonassessable, will have the rights set forth in the Certificate of Designations and the Company’s bye-laws and memorandum of association, as applicable, and the issuance thereof will not be subject to any preemptive, subscription or similar rights.

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(d) Authorization and Enforceability of Transaction Documents.

(i) The Company has the corporate power and authority to execute and deliver the Transaction Documents to which it is a party and to carry out its obligations hereunder and thereunder (which includes the issuance of the Purchased Securities and the Common Shares issuable upon conversion of the Purchased Securities). The execution, delivery and performance by the Company of the Transaction Documents to which it is a party and the consummation by it of the transactions contemplated hereby and thereby for it have been duly authorized by all necessary corporate action on the part of the Company and its members, and no further approval or authorization is required on the part of the Company or its members for such purpose. The Transaction Documents to which the Company is a party are or will be, assuming the due authorization, execution and delivery by each of the other parties hereto and thereto, valid and binding obligations of the Company enforceable against the Company in accordance with their respective terms, except as the same may be limited by applicable bankruptcy, insolvency, reorganization, moratorium or similar laws affecting creditors’ rights generally and general equitable principles (“Bankruptcy Exceptions”).

(ii) The execution, delivery and performance by the Company of the Transaction Documents to which it is a party, the consummation by it of the transactions contemplated hereby and thereby for it and compliance by the Company with any of the provisions hereof and of the other Transaction Documents will not (x) violate, conflict with, or result in a breach of any provision of, or constitute a change of control under, or constitute a default (or an event that, with notice or lapse of time or both, would constitute a default) under, or result in the termination of, or accelerate the performance required by, or result in a right of termination or acceleration of, or result in the creation of, any lien, security interest, charge or encumbrance upon any of the assets of the Company or any Significant Subsidiary under any of the terms, conditions or provisions of (A) its memorandum of association or bye-laws or (B) any note, bond, mortgage, indenture, deed of trust, loan agreement, license, lease, agreement, Company Plan or other instrument or obligation to which the Company or any Significant Subsidiary is a party or by which it or any Significant Subsidiary may be bound, or to which the Company or any Significant Subsidiary or any of the assets of the Company or any Significant Subsidiary may be subject, or (y) violate any statute, rule or regulation or any judgment, ruling, order, writ, injunction or decree applicable to the Company or any Significant Subsidiary or any of their respective assets except, in the case of clauses (x)(B) and (y), for those occurrences that, individually or in the aggregate, have not had and would not reasonably be expected to have a Material Adverse Effect.

(iii) To the Company’s knowledge, no notice to, filing with, exemption from or review by, or authorization, consent or approval of, any Regulatory Entity is required to be given, made or obtained by the Company in connection with the Purchase and the other transactions contemplated for it by the Transaction Documents, (x) except as set forth on Schedule 1.3(c), (y) except as may be necessary in connection with the registration and offering of securities as provided in the Registration Agreement and (z) except for the listing of the Common Shares issuable upon conversion of the Purchased Securities on the NYSE as provided in Section 3.4.

(e) Knowledge as to Conditions. As of the date of this Agreement, the Company knows of no reason why any regulatory approvals and, to the extent necessary, any other approvals, authorizations, filings, registrations, and notices required or otherwise a condition to the consummation of the transactions contemplated by the Transaction Documents are not reasonably likely to be obtained.

(f) Permits. The Company and each subsidiary have all permits, licenses, authorizations, orders and approvals of, and have made all filings, applications and registrations with, any Regulatory Entity that are required on the part of the Company or its subsidiaries in order to carry on their business as presently conducted, except where the failure to have such permits, licenses, authorizations, orders and approvals or the failure to make such filings, applications and registrations, individually or in the aggregate, has not had and would not be reasonably likely to have a Material Adverse Effect; and all such permits, licenses, authorizations, orders and approvals are in full force and effect and, to the knowledge of the Company, no suspension or cancellation of any of them is threatened, and all such filings, applications and registrations are current, except where the absence, suspension, cancellation or non-currency of any thereof, individually or in the aggregate, has not had and would not be reasonably likely to have a Material Adverse Effect.

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(g) Proceedings. Except as disclosed in Schedule 2.2(g), there is no claim, action, suit or governmental or regulatory proceeding or investigation pending or, to the Company’s knowledge, threatened against the Company or any of its subsidiaries, nor is the Company or any of its subsidiaries subject to any order, judgment or decree, in each case, that, individually or in the aggregate, has had or would reasonably be expected to have a Material Adverse Effect.

(h) SEC Filings; Company Financial Statements. Except as set forth in Schedule 2.2(h):

(i) Since July 18, 2007, the Company and each subsidiary of the Company has timely filed all material reports, registrations, documents, filings, statements and submissions, together with any amendments thereto, that it was required to file with any Regulatory Entity (the foregoing, collectively, the “Company Reports”) and has paid all material fees and assessments due and payable in connection therewith. As of their respective dates of filing, the Company Reports complied in all material respects with all statutes and applicable rules and regulations of the applicable Regulatory Entities. To the knowledge of the Company, there are no outstanding comments from the SEC or any other Regulatory Entity with respect to any Company Report. With respect to the Company Reports other than the SEC Filings, such Company Reports were complete and accurate in all material respects as of their respective dates.

(ii) The SEC Filings, when they became effective or were filed with the Commission, as the case may be, conformed in all material respects to the requirements of the Securities Act or the Exchange Act, as applicable, and the rules and regulations of the Commission thereunder, and none of such documents, as of its date or if amended, as of the date of such amendment, as the case may be, contained an untrue statement of a material fact or omitted to state a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances in which they were made, not misleading. The Current 8-K Report and each SEC Filing made after the date hereof and prior to the Closing, when filed with the Commission, will conform in all material respects to the requirements of the Exchange Act and the rules and regulations of the Commission thereunder, and will not when filed with the Commission contain an untrue statement of a material fact or omit to state a material fact required to be stated therein or necessary to make the statements therein, in light of the circumstances in which they were made, not misleading.

(iii) The consolidated balance sheets of the Company and its subsidiaries and the related consolidated statements of income, stockholders’ equity and cash flow, together with the notes thereto (the “Company Financial Statements”), included or incorporated by reference in any Company Report filed with the SEC prior to the date of this Agreement, (1) have been prepared from, and are in accordance with in all material respects, the books and records of the Company and its subsidiaries, (2) complied as to form, as of their respective date of filing with the SEC, in all material respects with applicable accounting requirements and with the published rules and regulations of the SEC with respect thereto, (3) present fairly in all material respects the consolidated financial position of the Company and its subsidiaries as of the dates specified therein and the consolidated results of their operations, changes in stockholders’ equity and cash flows of the Company and its subsidiaries for the periods specified therein, subject, in the case of any unaudited financial statements, to normal recurring year-end adjustments and (4) except as may be stated therein, have been prepared in conformity with generally accepted accounting principles in the United States applied on a consistent basis during the periods involved.

(iv) PricewaterhouseCoopers LLP, who have certified certain financial statements of the Company and its subsidiaries, are independent public accountants with respect to the Company as required by the Securities Act and the rules and regulations of the Commission and the Public Company Accounting Oversight Board.

(v) The Company intends to file its annual report on Form 10-K for the fiscal year ended March 31, 2008 with the Commission on or before June 30, 2008 and to its knowledge, after due inquiry, (x) the Company will be able to make such filing by such date or (y) such filing will be accompanied by an unqualified audit opinion from PricewaterhouseCoopers LLP.

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(i) Liabilities and Obligations. The Company and its subsidiaries do not have any liabilities or obligations (accrued, absolute, contingent or otherwise) of a nature that would be required to be accrued or reflected in a consolidated balance sheet prepared in accordance with GAAP, other than liabilities or obligations (i) that are reflected on, reserved against or disclosed in the notes to the Company’s consolidated balance sheet included in the Company’s quarterly report on Form 10-Q for the fiscal quarter ended December 31, 2007, (ii) that are disclosed in Schedule 2.2(i) or (iii) that, individually or in the aggregate, have not had and would not be reasonably likely to have a Material Adverse Effect.

(j) Absence of Certain Changes. Since December 31, 2007, except as disclosed in the Publicly Disclosed Information and other than the matters disclosed in Schedule 2.2(j), (1) the Company and its subsidiaries have conducted their respective businesses in all material respects in the ordinary course, consistent with past practice, (2) the Company has not made or declared any distribution in cash or in kind to its stockholders or issued or repurchased any shares of its capital stock or other equity interests, and (3) there have not been any changes, events, conditions or circumstances that, individually or in the aggregate, have had or would reasonably be expected to have a Material Adverse Effect.

(k) Absence of Labor Dispute. No labor dispute with the employees of the Company or any subsidiary exists or, to the knowledge of the Company, is imminent that would be reasonably likely to have a Material Adverse Effect.

(l) Possession of Intellectual Property. The Company and its subsidiaries own or possess, or can acquire on reasonable terms, adequate patents, patent rights, licenses, inventions, copyrights, know how, trademarks, service marks, trade names or other intellectual property (collectively, “Intellectual Property”) necessary to carry on the business now operated by them, and neither the Company nor any of its subsidiaries has received any notice or is otherwise aware of any infringement of or conflict with asserted rights of others with respect to any Intellectual Property or of any facts or circumstances that would render any Intellectual Property invalid or inadequate to protect the interests of the Company and its subsidiaries therein, and that infringement or conflict (if the subject of any unfavorable decision, ruling or finding) or invalidity or inadequacy, individually or in the aggregate, would reasonably be expected to have a Material Adverse Effect.

(m) Properties and Leases. Except as set forth in Schedule 2.2(m), the Company and its subsidiaries do not own any material real property; all of the real property or material personal property leases and subleases to which the Company or any of its subsidiaries is a party are valid and effective in accordance with their respective terms, and there is not, under any such lease or sublease, any existing default by the Company or such subsidiary or any event which, with notice or lapse of time or both, would constitute such a default except for such as would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect.

(n) Environmental Laws. Except as would not, individually or in the aggregate, reasonably be expected to have a Material Adverse Effect, the Company and its subsidiaries are in compliance with applicable federal, state, local and foreign laws relating to pollution or protection of human health or the environment or the release, use, treatment, storage or disposal of pollutants, contaminants, wastes, toxic substances or hazardous substances.

(o) Compliance with Laws.

(i) Except as set forth in Schedule 2.2(g), since January 1, 2006, the Company and each of its subsidiaries has complied in all material respects and is not in default or violation in any respect of any applicable statute, law, ordinance, license, rule, regulation, order, demand, writ, injunction, decree, or judgment of any Regulatory Entity, except for failures to comply, defaults or violations that, individually or in the aggregate, have not had and are not reasonably expected to have a Material Adverse Effect.

(ii) The Company (w) is in compliance with all applicable provisions of the Sarbanes-Oxley Act of 2002 and rules of the Commission promulgated thereunder, as and to the extent the Company is currently required to comply with such Act and rules thereunder; (x) maintains disclosure controls and procedures required by Rule 13a-15 or 15d-15 under the Exchange Act, (y) such disclosure controls and procedures are effective to ensure that all material information

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concerning the Company is made known on a timely basis to the individuals responsible for the preparation of the Company’s filings with the Commission and other public disclosure documents, and (z) is in compliance with the listing and other rules of the NYSE applicable to the Company as a listed issuer.

(iii) Neither the Company nor, to the knowledge of the Company, any director, officer, agent, employee, Affiliate or person acting on behalf of the Company is currently subject to any U.S. sanctions administered by the Office of Foreign Assets Control of the U.S. Treasury Department.

(iv) The Company has in place policies and procedures reasonably designed to ensure that its and its subsidiaries’ operations are, and has no reason

to believe said operations are not, being conducted in material compliance with the financial recordkeeping and reporting requirements of the Currency and Foreign Transactions Reporting Act of 1970, as amended, the USA PATRIOT Act of 2001, all applicable money-laundering and “know your customer” statutes and rules and regulations and any related or similar rules, regulations or guidelines issued, administered or enforced by any Regulatory Entity to the extent applicable to the Company and its subsidiaries (collectively, the “Money-Laundering Laws”), and, except as disclosed in the Publicly Disclosed Information, no action, suit or proceeding by or before any court or governmental agency is pending or to the knowledge of the Company, threatened against the Company or any of its subsidiaries with respect to Money-Laundering Laws.

(v) Neither the Company nor any of its subsidiaries, nor, to the knowledge of the Company, any director, officer, agent, employee or other person acting on behalf of the Company or any of its subsidiaries, (i) has violated the U.S. Foreign Corrupt Practices Act of 1977, as amended, or any other similar applicable foreign, federal or state legal requirement, (ii) has made or provided, or caused to be made or provided, directly or indirectly, any payment or thing of value to a foreign official, foreign political party, candidate for office or any other person knowing that the person will pay or offer to pay the foreign official, party or candidate, for the purpose of influencing a decision, inducing an official to violate their lawful duty, securing any improper advantage, or inducing a foreign official to use their influence to affect a governmental decision, (iii) has paid, accepted or received any unlawful contributions, payments, expenditures or gifts, (iv) has violated or operated in noncompliance in all material respects with any export restrictions, money laundering law, anti-terrorism law or regulation, anti-boycott regulations or embargo regulations or (v) is currently subject to any United States sanctions administered by the Office of Foreign Assets Control of the United States Treasury Department.

(p) Agreements with Regulatory Entities. Except as set forth in Schedule 2.2(p), neither the Company nor any of its subsidiaries is subject to any cease-and-desist or other similar order or enforcement action issued by, or is a party to any written agreement, consent agreement or memorandum of understanding with, or is a party to any commitment letter or similar undertaking to, or is subject to any capital directive by, or since December 31, 2006, has adopted any board resolutions at the request of, any Regulatory Entity that currently restricts in any material respect the conduct of its business or that in any material manner relates to its capital adequacy, its liquidity and funding policies and practices, its ability to pay dividends, its credit, risk management or compliance policies, its internal controls, its management or its operations or business (each item in this sentence, a “Regulatory Agreement”), nor has the Company or any subsidiary of the Company been advised since December 31, 2006 by any Regulatory Entity that it is considering issuing, initiating, ordering, or requesting any such Regulatory Agreement. The Company and each subsidiary of the Company is in compliance in all material respects with each Regulatory Agreement to which it is party or subject, and neither the Company nor any subsidiary of the Company has received any written notice from any Regulatory Entity indicating that either the Company or such subsidiary is not in compliance in all material respects with any such Regulatory Agreement.

(q) Insurance. The Company and its subsidiaries carry or are entitled to the benefits of insurance in such amounts and covering such risks as are generally maintained by companies engaged in the same or similar business, and all such insurance is in full force and effect (provided that the Company makes

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no representation or warranty regarding the probability or amount of any insurance recovery with regard to any of the litigation matters disclosed in Schedule 2.2(g) or in the Publicly Disclosed Information).

(r) Tax Matters.

(i) The Company and each of its subsidiaries have timely filed all material Tax Returns required to have been filed as of the date hereof (or extensions have been duly obtained) and have paid all material Taxes required to have been paid by them through the date hereof, except with respect to matters for which adequate reserves have been established in accordance with GAAP.

(ii) Except as set forth in Schedule 2.2(r), neither the Company nor any subsidiary has any material current liability, and the Company has no knowledge of any events or circumstances that could result in any material liability, for Taxes of any person (other than the Company and its subsidiaries) (A) under Treasury Regulation Section 1.1502-6 (or any similar provision of state, local or foreign law) or (B) as a transferee or successor, by contract or otherwise.

(iii) Except as set forth in Schedule 2.2(r), none of the Company or any of its subsidiaries is a party to, is bound by or has any obligation under any material Tax sharing or material Tax indemnity agreement or similar contract or arrangement other than any contract or agreement between or among the Company and any of its subsidiaries.

(iv) All material Taxes required to be withheld, collected or deposited by or with respect to the Company and each of its subsidiaries have been timely withheld, collected or deposited as the case may be and, to the extent required, have been paid to the relevant taxing authority except with respect to matters for which adequate reserves have been established in accordance with GAAP.

(v) To the knowledge of the Company, except as set forth in Schedule 2.2(r), (A) no unsatisfied material deficiencies for any Tax Returns referred to in clause (i) have been proposed or assessed against or with respect to the Company or any of its subsidiaries (and there is no outstanding audit, assessment, dispute or claim concerning any material Tax liability of the Company or any of its subsidiaries pending or raised) in each case by any taxing authority in writing to the Company or any of its subsidiaries; (B) no written claim has been made to the Company by any Regulatory Entity in a jurisdiction where neither the Company nor any of its subsidiaries files material Tax Returns that it is or may be subject to taxation by that jurisdiction; and (C) neither the Company nor any of its subsidiaries has granted any currently effective waiver of any federal, state, local or foreign statute of limitations period with respect to, or any extension of such a period for the assessment of, any material Tax that period has not yet expired.

(vi) There are no material encumbrances or liens with respect to Taxes upon any of the assets or properties of either the Company or any of its subsidiaries, other than with respect to Taxes not yet due.

(vii) No closing agreement pursuant to section 7121 of the U.S. Internal Revenue Code of 1986, as amended (the “Code”) (or any similar provision of state, local or foreign law) has been entered into by or with respect to the Company or any of its subsidiaries.

(viii) Neither the Company nor any of its subsidiaries has participated in a “listed transaction” within the meaning of Treasury Regulation Section 1.6011-4(b)(2).

(ix) To the knowledge of the Company, the Company is not a passive foreign investment company (a “PFIC”) within the meaning of Section 1297(a) of the Code for its current taxable year, and the Company does not expect to become a PFIC in the foreseeable future.

(x) To the knowledge of the Company, neither the Company nor any non-US subsidiary of the Company has earned “effectively connected income” within the meaning of Section 864(c) of the Code.

(xi) To the knowledge of the Company, the Company is not, and, after giving effect to the transactions contemplated by this Agreement, will not be a “controlled foreign corporation” within the meaning of Section 957(a) of the Code.

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(xii) “Tax” shall mean any and all federal, state, local and foreign taxes, including taxes based upon or measured by gross receipts, income, profits, sales, use and occupation, and value added, ad valorem, transfer, franchise, withholding, payroll, recapture, employment, excise, property and other similar taxes, together with all interest, penalties and additions imposed with respect to such amounts whether disputed or not. “Tax Returns” shall mean any return, report, information return or other document (including any related or supporting information) filed or required to be filed with any taxing authority with respect to Taxes. It is agreed and understood that no representation or warranty is made in respect of Tax matters in any Section of this Agreement other than this Section 2.2(r)).

(s) Employee Benefits.

(i) Other than as disclosed in the Company’s SEC Filings with respect to any Company Plan that is an “employee pension benefit plan” (within the meaning of Section 3(2) of ERISA) subject to Title IV of ERISA, no withdrawal or termination liability under the Employee Retirement Income Security Act of 1974, as amended (“ERISA”) or the Code has been incurred that remains unsatisfied and, to the knowledge of the Company, there exists no condition or circumstances in connection with which the Company or any of its subsidiaries would reasonably be expected to be subject to any such liability that is reasonably expected, individually or in the aggregate, to have a Material Adverse Effect. The Company Plans have been administered in substantial compliance with applicable statutes, laws and regulations, including ERISA and the Code, except for any failures to comply that are not reasonably expected, either individually or in the aggregate, to have a Material Adverse Effect. The Company and its subsidiaries are employing all of their employees in compliance with applicable statutes, laws and regulations regarding employment, except for any failures to comply that are not reasonably likely, individually or in the aggregate, to have a Material Adverse Effect.

The term “Company Plan” means any “employee benefit plan” (within the meaning of Section 3(3) of ERISA) and any stock purchase, stock option, severance, change-in-control, fringe benefit, bonus, incentive, deferred compensation or other employee benefit plans, programs or policies, whether or not subject to ERISA, under which any current or former director, officer, independent contractor or employee of the Company or any of its subsidiaries has any present or future right to benefits.

(ii) The execution, delivery and performance of this Agreement and the consummation of the transactions contemplated hereby will not accelerate any benefits or vesting or trigger any rights under any Company Plan or any employment, consulting or similar agreement to which the Company or any of its subsidiaries is a party or is bound.

(t) Brokers and Finders; Other Expenses. Neither the Company nor any of its subsidiaries nor any of their respective officers, directors, employees or agents has employed any broker or finder or has incurred, or shall incur, any liability for any financial advisory, brokerage or finders’ fees or commissions or any similar charges in connection with this Agreement or the transactions contemplated hereby, except for fees payable to Lazard Frères & Co. LLC.

(u) Investment Advisor; Investment Company. Neither the Company nor its subsidiaries conducts activities of an “investment advisor” as such term is defined in Section (a)(20) of the Investment Company Act of 1940, as amended, whether or not registered under the Investment Advisors Act of 1940, as amended. Neither the Company nor its subsidiaries is, and immediately after receipt of payment for the Purchased Securities will not be required to register as, an “investment company” within the meaning of the U.S. Investment Company Act of 1940, as amended, and neither the Company nor its subsidiaries sponsors any person that is such an investment company.

(v) Amendment to the Rights Agreement. Prior to the execution and delivery of this Agreement, the Company and Computershare Trust Company, N.A. have executed and delivered the Amendment No. 1 to the Rights Agreement dated May 20, 2008, attached hereto as Annex H.

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2.3 Representations and Warranties of the Investor. The Investor hereby represents and warrants to the Company that as of the date hereof and as of the Closing Date:

(a) Organization and Authority. The Investor has been duly organized and is validly existing in good standing under the laws of the jurisdiction of its organization, with the requisite power and authority to own its properties and conduct its business as currently conducted.

(b) Authorization and Enforceability of Transaction Documents.

(i) The Investor has the requisite power and authority to execute and deliver the Transaction Documents to which it is a party and to carry out its obligations hereunder and thereunder. The execution, delivery and performance by the Investor of the Transaction Documents to which it is a party and the consummation of the transactions contemplated hereby and thereby have been duly authorized by all necessary company action on the part of the Investor, and no further approval or authorization is required on the part of the Investor. The Transaction Documents to which the Investor is a party are or will be, assuming the due authorization, execution and delivery by each of the other parties hereto and thereto, valid and binding obligations of the Investor enforceable against the Investor in accordance with their respective terms, except as the same may be limited by Bankruptcy Exceptions.

(ii) The execution, delivery and performance by the Investor of the Transaction Documents to which it is a party, the consummation of the transactions contemplated hereby and thereby and compliance by the Investor with any of the provisions hereof and thereof, will not (A) violate, conflict with, or result in a breach of any provision of, or constitute a default (or an event that, with notice or lapse of time or both, would constitute a default) under, or result in the termination of, or accelerate the performance required by, or result in a right of termination or acceleration of, or result in the creation of, any lien, security interest, charge or encumbrance upon any of the properties or assets of such Investor under any of the terms, conditions or provisions of (1) its organizational documents or (2) any note, bond, mortgage, indenture, deed of trust, license, lease, agreement or other instrument or obligation to which the Investor is a party or by which it may be bound, or to which the Investor or any of the assets of the Investor may be subject, or (B) subject to compliance with the statutes and regulations referred to in the next paragraph, violate any statute, rule or regulation or any judgment, ruling, order, writ, injunction or decree applicable to the Investor or any of its assets except, in the case of clauses (A)(2) and (B), for those occurrences that, individually or in the aggregate, have not had and would not be reasonably likely to have an Investor Material Adverse Effect. “Investor Material Adverse Effect” means a material adverse effect on the ability of the Investor to consummate the Purchase and the other transactions contemplated for it by this Agreement.

(iii) To the Investor’s knowledge, no notice to, filing with, exemption from or review by, or authorization, consent or approval of, any Regulatory Entity is required to be given, made or obtained by the Investor in connection with the Purchase and the other transactions contemplated for it by the Transaction Documents, except as set forth on Schedule 2.3(b)(iii).

(c) Ownership. After giving effect to the Purchase, as of the Closing Date, the Investor will not have beneficial ownership of any issued and outstanding Common Shares except for the Common Shares issuable upon conversion of the Purchased Securities. The Investor is not acting in concert with any person (other than its controlled Affiliates) with respect to making or holding this investment and does not otherwise have an agreement, arrangement or understanding with any person (other than its controlled Affiliates and the Company) or otherwise constitute a “group” with any person for the purpose of acquiring, disposing of or voting any securities of the Company (within the meaning of Section 13(d) of the Exchange Act).

(d) Financial Capability. The Investor has or will have available prior to the Closing funds to make the Purchase on the terms and conditions contemplated by this Agreement.

(e) Trading. The Investor is aware that the securities laws of the United States generally prohibit any person who has material non-public information about a company from, among other things, purchasing or selling securities of such company on the basis of such information or from communicating such information to any other person under circumstances in which it is reasonably foreseeable that such person may purchase or sell such securities.

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Article III

COVENANTS

3.1 Reasonable Best Efforts. Subject to the terms and conditions of this Agreement, each of the parties will use its reasonable best efforts in good faith to take, or cause to be taken, all actions, and to do, or cause to be done, all things necessary, proper or desirable, or advisable under applicable laws, so as to permit consummation of the Purchase as promptly as practicable and otherwise to enable consummation of the transactions contemplated hereby subject to the conditions hereof and shall cooperate fully with the other party to that end, including in relation to cooperating in seeking to obtain the consents, clearances, approvals and notices (and the expiration of waiting periods) referred to in Schedule 1.3(c).

3.2 Expenses. Except as provided in Section 5.5 or as may otherwise be provided in any other Transaction Document, each of the parties hereto will bear and pay all costs and expenses incurred by it or on its behalf in connection with the transactions contemplated under the Transaction Documents, including fees and expenses of its own financial or other consultants, investment bankers, accountants and counsel.

3.3 Publicity. No public release or announcement concerning the transactions contemplated hereby shall be issued by either party without the prior consent of the other party (which consent shall not be unreasonably withheld or delayed), except as such release or announcement may be required by law or the rules or regulations of any United States or foreign securities exchange, in which case the party required to make the release or announcement shall, to the extent reasonably practicable, allow the other party reasonable time to comment on such release or announcement in advance of such issuance. The provisions of this Section 3.3 shall not restrict the ability of a party hereto to summarize or describe the transactions contemplated by this Agreement, or file a copy of the Transaction Documents, in or with any registration statement, prospectus or other offering document or any report required by law, regulation or stock exchange rule so long as the other party is provided a reasonable opportunity to comment on such disclosure in advance.

3.4 Sufficiency of Outstanding Common Shares. During the period from the Closing Date until the date on which all the Purchased Securities are converted into Common Shares, the Company shall at all times have reserved for issuance, free of pre-emptive or similar rights, a sufficient number of shares of authorized and unissued Common Shares to effectuate the conversion of the Purchased Securities without regard to any limitation on such conversion. Prior to the Closing, the Company shall, at its expense, cause the Common Shares issuable upon conversion of the Purchased Securities to be listed on the NYSE, subject to official notice of issuance, and shall maintain such listing on the NYSE for as long as the Common Shares remain listed thereon.

3.5 Withholding of Tax. The Company or its paying agent shall withhold and backup withhold taxes on all payments on the Purchased Securities (and on the Common Shares issued on conversion of the Purchased Securities) to the extent required by law. If, prior to any such payment, the Company receives from the Investor, a duly executed, valid, accurate and properly completed IRS Form W-9 or an appropriate IRS Form W-8 evidencing the Investor’s entitlement to an exemption from backup withholding on such payment, and the Company does not know or have reason to know otherwise, the Company shall, and shall cause its paying agent to, pay such payment to such entity, free and clear of backup withholding of United States federal income tax as evidenced by such form.

3.6 Anti-Trust Clearance. Prior to the Closing, the Investor and the Company will make such filings as may be required in connection with the Purchase and the conversion of the Purchased Securities pursuant to the Hart-Scott-Rodino Antitrust Improvements Act of 1976 (“HSR Act”) or as may be required by the German Federal Cartel Office and the termination or expiration of the applicable waiting periods required under the HSR Act and by the German Federal Cartel Office shall have occurred. The Company and the Investor shall cooperate in making any filings required under the HSR Act or required by the German Federal Cartel Office.

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3.7 Investor Representatives.

(a) The Investor shall have the right to designate up to two individuals to serve as directors on the Company’s board of directors in accordance with the Company’s memorandum of association and bye-laws, as and to the extent provided in this Section 3.7 (any such designee who is appointed or elected and serving as a director pursuant to this Section 3.7, an “Investor Representative”). At the Closing (or, if later, promptly following the Company’s annual meeting of members currently scheduled for July 28, 2008), the Company shall take all corporate and other actions necessary to increase the size of the Company’s board of directors by two and to cause two individuals named in Schedule 3.7 that have been designated by the Investor no later than two business days prior to the Closing Date to be appointed to the Company’s board of directors for an initial term ending at the Company’s next annual meeting of members (after the annual meeting currently scheduled for July 28, 2008); provided that, prior to the Closing, the board of directors has approved the designees as provided in Section 3.7(b) and each of the designees has delivered to the Company a signed, undated letter of resignation in the form attached as Annex I.

(b) So long as the Investor is the beneficial owner of any Purchased Securities, and any Voting Shares issued upon the conversion of Purchased Securities, that in the aggregate represent at least 10% of the Voting Shares then outstanding (the “Two Director Amount”), the Company will take all corporate and other actions necessary to cause two individuals designated by the Investor to be nominated for election as directors on the Company’s board of directors at each annual meeting of members of the Company (following the annual meeting of members scheduled July 28, 2008), and will use its reasonable best efforts to cause such nominees to be elected at such meeting, in each case for a term that expires upon the next annual meeting of members or at such earlier time (if any) such nominee may resign, retire, die or be removed as a director. Alternatively, so long as the Investor is the beneficial owner of any Purchased Securities, and any Voting Shares issued upon the conversion of Purchased Securities, that in the aggregate represent at least 5% but less than 10% of the Voting Shares then outstanding (the “One Director Amount”), the preceding sentence shall not apply and instead the Company will take all corporate and other actions necessary to cause one individual designated by the Investor to be nominated for election as a director on the Company’s board of directors at each annual meeting of members of the Company, and will use its reasonable best efforts to cause such nominee to be elected at such meeting, in each case for a term that expires upon the next annual meeting of members or at such earlier time (if any) as the nominee may resign, retire, die or be removed as a director. Notwithstanding the foregoing, with respect to each individual designated by the Investor to be an Investor Representative pursuant to either of the two preceding sentences (or pursuant to Section 3.7(a)), (i) the Company shall have no obligation to cause such designee to be nominated or elected at any annual meeting (or appointed as a director) unless, prior to the time when the board of directors nominates directors for election at such meeting (or makes such appointment), the board of directors (excluding all Investor Representatives) shall, in its discretion, have approved the Investor’s designee for such nomination and election (or appointment) (such approval not to be unreasonably withheld) and (ii) the designee shall have delivered to the Company a signed, undated letter of resignation in the form attached as Annex I. It is understood and agreed that the board of directors may reasonably withhold approval of any such designee (other than any designee set forth on Schedule 3.7) if the board of directors (excluding all Investor Representatives) determines, in its discretion, that such designee (i) does not qualify as an independent director, as defined by the rules of the NYSE (or other applicable exchange), (ii) does not have experience and standing in the business community comparable to the experience and standing of independent directors currently serving on the Company’s board of directors generally, (iii) is associated with or an Affiliate of a Competitor (iv) is associated with or an Affiliate of a person or persons (other than the Investor or any of its Affiliates) seeking or proposing to acquire control of the Company or a material amount of the securities or assets of the Company or any of its subsidiaries without the approval of the board of directors (excluding all Investor Representatives) or (v) if the board of directors (excluding all Investor Representatives) determines that such designee, if elected or appointed to the board, would cause the Company to violate applicable law. It is understood and agreed that the board of directors may reasonably withhold approval of any designee set forth on Schedule 3.7 only if the board of directors (excluding all Investor Representatives) determines, in its discretion, that such designee (1) is associated with or an Affiliate of a Competitor as a result of such designee being an employee, director or consultant to such Competitor, (2) is associated with or an Affiliate of a person or

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persons (other than the Investor or any of its Affiliates) seeking or proposing to acquire control of the Company or a material amount of the securities or assets of the Company or any of its subsidiaries without the approval of the board of directors (excluding all Investor Representatives) or (3) if the board of directors (excluding all Investor Representatives) determines that such designee, if elected or appointed to the board, would cause the Company to violate applicable law. In the event that the Company reasonably withholds its approval of any such designees, it shall notify the Investor of its objections and the Investor shall have the right to designate a different individual for nomination and election at such annual meeting, subject to the provisions regarding board approval and a letter of resignation set forth above. Notwithstanding the foregoing, each Investor Representative’s term of office as a director shall terminate, and he or she shall resign from the board of directors, automatically and without any further action on his or her or the Company’s part, at any time when (A) (i) in the case of any Investor Representative appointed or elected as a director pursuant to Section 3.7(a) or the first sentence of this Section 3.7(b), the Investor ceases to beneficially own the Two Director Amount (subject to the last sentence of this Section 3.7(b)) or (ii) in the case of any Investor Representative elected a director pursuant to the second sentence of this Section 3.7(b), the Investor ceases to beneficially own the One Director Amount or (B) the board of directors (excluding all Investor Representatives) makes a determination, in its discretion, to withdraw its approval of such Investor Representative on any grounds specified in clause (i) through (v) above; provided that, in the case of clause (i), such determination shall be based upon a material change in circumstances that occurs or is discovered after the Investor Representative was previously approved by the board; and provided, further, that the board may withdraw its approval of an Investor Representative listed on Schedule 3.7 only on the grounds specified in clause (1) through (3) above. To give effect to any such termination or resignation, the Company shall have the right to date and accept the letter of resignation previously delivered by such Investor Representative. Solely with regard to clause (A)(i) above, if the Investor ceases to beneficially own the Two Director Amount, but continues to beneficially own the One Director Amount, then only one Investor Representative need resign as provided in clause (A)(i) and the Investor shall in its sole discretion select which Investor Representative shall remain on the board of directors and the other Investor Representative shall promptly resign.

(c) The Investor Representatives shall be entitled to serve on committees of the board of directors in accordance with the governance practices and procedures of the board of directors (including the discretionary nomination and selection process) on a basis comparable to that on which other directors serve as committee members; provided that no more than one Investor Representative shall be entitled to serve on any committee of the board of directors at any one time and no Investor Representative shall be entitled to serve as chairman of the board of directors or any committee. Any Investor Representative who is not a member of a committee of the board of directors shall have the right to attend and observe (but not vote at) each meeting of such committee (and to receive from the Company copies of all notices, information and other material provided to members of such committee).

(d) If at any time an Investor Representative is removed from the board of directors of the Company, either by a vote of the members or due to a determination by the board of directors of the Company under Section 3.7(b) above, the Investor may designate a different individual to serve as such Investor Representative and the Company will take all corporate and other actions necessary to cause the individual designated by the Investor to be appointed as soon as practicable to the Company’s board of directors for an initial term ending at the Company’s next annual meeting of members; provided that the board of directors has approved the designee as provided in Section 3.7(b) and the nominee has delivered to the Company a signed, undated letter of resignation in the form attached as Annex I.

(e) In the event an individual designated by the Investor and nominated by the board of directors for election at any annual meeting as provided above is not elected by the shareholders at such meeting, then the Investor shall have the right to designate an individual to attend (without voting right) each meeting of the board of directors or any committee thereof (and to receive from the Company copies of all notices, information and other material it provides to the board of directors and committees thereof) until such time as an Investor Representative is appointed or elected to the board of directors in lieu of such nominee that was not elected (or until the Investor is no longer entitled to have its designee so appointed

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or elected); provided that the Investor and individual designated to attend board of director meetings first sign and deliver to the Company an appropriate confidentiality and trading blackout agreement, in form and substance reasonably satisfactory to the Company, and unless the board of directors (excluding all Investor Representatives) at any time makes a determination, in its discretion, not to approve or withdraw approval of such individual on any reasonable grounds, which shall include any grounds in clause (b)(iii), (iv) or (v) above with regard to such designee. In addition, if Closing occurs before the annual meeting of members currently scheduled for July 28, 2008, the Investor should have the right to designate two individuals to attend meetings of the board of directors and committees thereof as provided in this Section 3.7(e), until such time as two designees are appointed directors as provided in Section 3.7(e) (or the Investor is no longer entitled to designate Investor Representatives).

(f) For the avoidance of doubt, if the Investor beneficially owns less than the Two Director Amount and greater than the One Director Amount, the Investor will have the right to designate only one Investor Representative and its rights and the Company’s obligations with respect to the second Investor Representative under this Section 3.7 shall terminate (but not with regard to any breach that may occur prior to such time). The Company’s obligations, and the Investor’s rights, under this Section 3.7 shall terminate generally upon the first time when the Investor ceases to beneficially own the One Director Amount, but not with regard to any breach that may occur prior to such time. The Investor shall not be deemed to beneficially own less than the One Director Amount or the Two Director Amount solely by reason of any action of the Company that increases the number of issued and outstanding Voting Shares after the Closing.

(g) Before designating any individual (other than the persons identified on Schedule 3.7) to serve as an Investor Representative pursuant to Section 3.7(a), the Investor shall consult with the Company as to the Company’s views about the potential designee and give due consideration to the Company’s views.

(h) With regard to each individual designated to serve as an Investor Representative (or board observer), the Investor and such individual shall provide such information about the individual and the designation to the Company, and at such times, as the Company may reasonably request in order to ensure compliance with applicable securities laws and rules of Regulatory Entities, and to enable the Company’s board of directors to make the determinations contemplated in this Section 3.7.

3.8 Directors. So long as any Investor designee serves as an Investor Representative, the Company agrees to maintain directors’ insurance for such director in an amount not less than the amount of coverage provided from time to time for other members of the board of directors. The Company shall indemnify each such director to the same extent it indemnifies its other directors pursuant to its organizational documents and applicable law. Each such director shall be reimbursed for his or her out-of-pocket expenses incurred in connection with his or her participation as a member of the board of directors, in a manner consistent with the Company’s policies for reimbursing such expenses of other members of the board of directors. In addition, each such director, in his or her capacity as a member of the board of directors, shall be entitled to the compensation paid to other members of the board of directors, in their capacity as such, except for compensation paid to the Chairman of the Board or any director who is an officer or employee of the Company or its subsidiaries and except for compensation paid in respect of service on a committee or another special capacity in which such director does not serve.

3.9 Conduct of Business. Prior to the earlier of the Closing Date and the termination of this Agreement pursuant to Section 5.2 (the “Pre-Closing Period”), unless the Investor shall otherwise consent (such consent not to be unreasonably withheld, delayed or conditioned), the Company shall, and shall cause its subsidiaries to, use commercially reasonable efforts to carry on its business in the ordinary course of business and use reasonable best efforts to maintain and preserve its and such subsidiaries’ business (including its organization, assets, properties, goodwill and insurance coverage) and preserve its business relationships; provided that nothing in this sentence shall limit or require any actions that the board of directors of the Company may, in good faith, determine to be inconsistent with their duties or the Company’s obligations under applicable law or imposed by any Regulatory Entity. During the Pre-Closing Period, (i) the Company shall not merge or consolidate into, or sell, transfer or lease all or substantially all of its

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property or assets to, any other party unless the successor, transferee or lessee party, as the case may be (if not the Company), expressly assumes the due and punctual performance and observance of each and every covenant and condition of this Agreement to be performed and observed by the Company, (ii) the Company shall not declare or pay any dividend or distribution on the Common Stock and (iii) if the Company takes any action that would require any antidilution adjustment to be made under the Certificate of Designations as if issued on the date of this Agreement, the Company shall make appropriate adjustments such that the Investor will receive the benefit of such transaction as if the Purchased Securities had been outstanding as of the date of such action.

3.10 Certain Tax Matters.

(a) The Company shall use its reasonable best efforts to operate in a manner that prevents the Company from constituting a PFIC for any taxable year ending on or after the Closing Date.

(b) On or prior to the expiry of 60 days after the end of each taxable year of the Company, the Company shall provide the Investor with a statement that sets forth a good faith analysis of whether the Company was a CFC or a PFIC for such taxable year.

(c) If the Company determines that the Company constitutes a PFIC for any taxable year, the Company shall (i) notify the Investor, and (ii) to the extent that the Company constitutes a PFIC in a period prior to the conversion of the Purchased Securities into Common Shares, provide the Investor with a statement (a “PFIC Annual Information Statement”), certificate or any other information necessary in order for the Investor to timely and properly (A) make an election under section 1295 of the Code (a “QEF Election”) with respect to the Company for such taxable year and (B) comply with the reporting requirements applicable with respect to such QEF Election. The PFIC Annual Information Statement shall contain the following information and representations: (I) the first and last days of the taxable year of the Company to which the PFIC Annual Information Statement applies (the “PFIC Statement Year”), (II) the Investor’s pro rata shares of “ordinary earnings” and “net capital gain”, within the meaning of section 1293 of the Code and the Treasury Regulations issued thereunder, of the Company for such PFIC Statement Year, (III) the amount of cash and the fair market value of other property distributed or deemed distributed to the Investor during such PFIC Statement Year, and (IV) a statement that the Company will permit the Investor and its representatives to inspect and to copy the Company’s permanent books of account, records and such other documents as may be maintained by it for the purpose of establishing that the Company’s ordinary earnings and net capital gain are computed in accordance with United States federal income tax principles and verifying these amounts and the Investor’s pro rata shares thereof. Each PFIC Annual Information Statement shall be signed by the Company and shall be furnished to the Investor no later than 60 days following the end of the PFIC Statement Year. For the avoidance of doubt, the Company is required to provide a PFIC Annual Information Statement only to the extent provided in this Section 3.10(c), and not under any other Section (including Section 3.10(d)) of this Agreement.

(d) The Company shall promptly furnish to the Investor any other information reasonably requested to enable the Investor to comply with any applicable tax reporting requirements with respect to the acquisition, ownership, or disposition of, and income attributable to, any Equity Securities held by the Investor, including, without, limitation, such information as may be reasonably requested by the Investor to complete United States federal, state or local income tax returns with respect to the Company’s status as a CFC or a PFIC.

(e) The costs of complying with the requirements of this Section 3.10 shall be borne by the Company.

3.11 Certain Adjustments. (a) If, from the date hereof until the first anniversary of the Closing Date the Company issues and sells, or agrees to issue and sell, in one or more transactions Common Shares (or other securities that are convertible into or exchangeable or exercisable for, or are otherwise linked to, Common Shares) (excluding Common Shares or other equity securities and/or options or other rights in respect thereof to be offered to directors, employees or consultants of the Company or its direct or indirect subsidiaries pursuant to employee benefit plans, employment agreements or other customary compensatory plans or arrangements) at a purchase (or reference, implied, conversion, exchange or

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comparable) price (the “New Issuance Price”) per share less than the Conversion Price (as defined in the Certificate of Designations) (a “Conversion Reset Issuance”), then on the second business day after the closing of any Conversion Reset Issuance, the Company shall make a payment to the Investor (the “Reset Payment”) equal to the product of (i) an amount equal to (x) the Conversion Price minus the New Issuance Price, divided by (y) the Conversion Price and (ii) the amount equal to (A) the Price per Series A Share set forth in Annex A multiplied by (B) the Actual Number grossed up as required to compensate the Investor for any diminution in value in the Purchased Securities resulting from such Reset Payment; provided that the Company, in its sole discretion and as an alternative to making all or any portion of such Reset Payment in cash, may instead pay the Reset Payment due to the Investor in whole or in part by delivering to the Investor Common Shares valued at 95% of the Current Market Price of the Common Shares (as such term is defined in the Certificate of Designations, with the 10 consecutive trading days referenced in such definition to end on the last trading day prior to the earlier of the date on which the Reset Payment occurs or the first date of the announcement of the related Conversion Reset Issuance), but solely to the extent that any such delivery of Common Shares would not result in the Company failing to comply with applicable requirements of the NYSE or any other Regulatory Entity (provided that, in the event the Company elects to pay the Reset Payment by delivering Common Shares, the Company shall, in its sole discretion, have a reasonable period of time in which to seek any shareholder approval required to satisfy such requirements and the Company’s obligation to pay the related Reset Payment shall be postponed until such time as such shareholder approval shall have been obtained or denied).

(b) Any such Reset Payment shall be treated by the parties as an adjustment to the purchase price for the Purchased Securities.

(c) If, from the date hereof until the first anniversary of the Closing Date (or, if later, pursuant to any “Securities Demand” provision in respect of any bank financing incurred in satisfaction of the condition set forth in Section 1.3(e)(iv)) the Company issues and sells any preference shares with an annual dividend rate (“New Issuance Dividend Rate”) greater than a rate (the “Rate Limit”) equal to (i) the annual Quarterly Dividend Rate divided by (y) 1.1 (a “Dividend Reset Issuance”), then the annual Quarterly Dividend Rate shall be adjusted upward (if necessary) so as to equal 110% of the New Issuance Dividend Rate, but only with respect to Purchased Securities beneficially owned (and only while beneficially owned) by the Investor (or any controlled Affiliates of the Investor), with such adjustment to be effective on the issue date for the Dividend Reset Issuance, and Quarterly Dividends shall accumulate on such securities at such adjusted rate from such date for as long as they remain beneficially owned as aforesaid and issued and outstanding) and shall be payable if, as and when Quarterly Dividends are payable under the Certificate of Designations. The Company may pay the incremental amount of any such Quarterly Dividend resulting from such adjustment, when so payable, in cash or by delivering Common Shares valued in the manner set forth in Section 3.11(a) with respect to Reset Payments (with the 10 consecutive trading days referenced therein to end on the trading day prior to the relevant date of payment and subject to the shareholder vote provisions of Section 3.11(a)).

Article IV

ADDITIONAL AGREEMENTS

4.1 Standstill Agreement. The Investor agrees that, without the prior written approval of the Company, neither the Investor nor any of its Affiliates will, directly or indirectly:

(a) purchase, offer or agree to purchase, or otherwise acquire beneficial ownership of, any Equity Securities (as hereinafter defined) if, upon consummation of such purchase or other acquisition, the Investor or its Affiliates would have beneficial ownership of 20.0% or more of the issued and outstanding Voting Shares (as hereinafter defined), other than solely as a consequence of a reduction in the number of Equity Securities outstanding or as a result of the issuance of any Common Shares in respect of Purchased Securities due to an adjustment or share payment provisions in the Certificate of Designations or this Agreement; or

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(b) (i) make or in any way participate in any solicitation of proxies to vote, or seek to advise or influence any person with respect to the voting of, any Voting Shares of the Company or any of its subsidiaries, (ii) seek or propose to influence, advise, change or control the management, board of directors, policies, affairs or strategy of the Company or any of its subsidiaries, in each case by way of any public communication, or any communication to securityholders, intended for such purpose (it being understood that this clause (ii) shall not prohibit the Investor from exercising its rights under Section 3.7 or any Investor Representative from performing his or her duties as a director of the Company), (iii) make or encourage others to make a proposal for any transaction which would result in a Change of Control (as defined below) or (iv) enter into any agreements or understandings with any person (other than the Company or any of its subsidiaries) for the purpose of any of the actions described in clauses (i), (ii) and (iii) above.

(c) The Investor’s obligations under Sections 4.1(a) and 4.1(b) shall terminate on the earliest of: (i) the third anniversary of the Closing Date; (ii) the date on which the Investor and its Affiliates beneficially own less than 5% of the issued and outstanding Voting Shares; (iii) the date on which the Company’s board of directors (x) publicly recommends that shareholders tender their shares to any person who has publicly announced or commenced a tender or exchange offer that, if consummated, would result in a Change of Control, or (y) fails to recommend that shareholders reject such offer within ten (10) business days after its public announcement or commencement; (iv) the public announcement by the Company that it is “for sale” in a transaction, or that it supports a proposed transaction, that would result in a Change of Control; (v) the execution by the Company of a definitive agreement that, if consummated, would result in a Change of Control, (vi) the public announcement by or on behalf of any person (other than Investor and its Affiliates) or “group”, as such term is defined in Section 13(d)(3) of the Exchange Act (other than any group that includes Investor or any of its Affiliates) of the commencement of a bona fide proxy or consent solicitation to elect or remove a majority of the board of directors of the Company that is not, within ten (10) days after the announcement of such proxy or consent solicitation, publicly opposed by the Company’s board of directors and that would, if successful, result in a Change of Control; or (vii) failure of any individual who is duly designated by the Investor to serve as an Investor Representative to be elected and maintained as a director as provided in Section 3.7 (other than any such failure due to the failure of such individual to comply with the requirements included in Section 3.7); (each of the events in clauses (i) – (vii) above, a “Standstill Termination Event”).

A “Change of Control” shall be deemed to have occurred (i) if any person (other than the Investor and its Affiliates) shall acquire beneficial ownership of more than 50% of the Voting Shares issued and outstanding, (ii) upon consummation of a merger or consolidation of the Company into or with another person (other than the Investor and its Affiliates) in which the shareholders of the Company immediately prior to the consummation of such transaction shall own less than 50% of the voting securities of the surviving person (or the parent of the surviving person where the surviving person is wholly owned by the parent person) immediately following the consummation of such transaction, (iii) upon the consummation of the sale, transfer or lease (but not including a transfer or lease by pledge or mortgage to a bona fide lender) of all or substantially all of the assets of the Company to another person other than a subsidiary of the Company or (iv) upon the adoption of a plan of liquidation or dissolution of the Company.

(d) As used herein, “Equity Securities” means, at any time, all Voting Shares, Series A Shares and other securities of any person convertible into, or exchangeable or exercisable for, Voting Shares, in each case then issued and outstanding. “Voting Shares” means, at any time, all Common Shares, Series A Shares and other voting shares (if any) of the Company, in each case then issued and outstanding. As used herein, “beneficial ownership”, “beneficially own” and correlative terms have the meaning set forth in Rule 13d-3 and Rule 13d-5 under the Exchange Act and, for the avoidance of doubt, it is understood and agreed that the following shall apply for the purpose of calculating the beneficial ownership of Voting Shares of any person for any purpose hereunder: (i) any Equity Security (including any Series A Shares) that is convertible into, or exchangeable or exercisable for, any Voting Shares and is beneficially owned by such person or any of its Affiliates shall be treated as fully converted, exchanged or exercised, as the case may be, into or for the underlying Voting Shares (regardless of when or on what conditions such conversion, exchange or exercise may occur), (ii) Equity Securities that are beneficially owned by such

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person and each of its Affiliates, or by any member of a group of which such person or any of its Affiliates is a member pursuant to said Rule 13d-5, shall be aggregated as if beneficially owned by such person and (iii) any Equity Security that is convertible into, or exchangeable or exercisable for, Voting Shares and is beneficially owned by any person other than such person or any of its Affiliates shall not be taken into account. Notwithstanding the foregoing, solely for the purpose of calculating the Two Director Amount and the One Director Amount in Section 3.7, beneficial ownership of the Investor shall mean the beneficial ownership of the Investor and any controlled Affiliate of the Investor but shall not include beneficial ownership of any Affiliate that is not a controlled Affiliate of the Investor or any member of a group that is not the Investor or any such controlled Affiliate of the Investor.

4.2 Lock-Up. From the date of this Agreement and for a period ending on the close of business on the second full NYSE trading day following the filing by the Company of its annual report on Form 10-K for the fiscal year ended March 31, 2008 (the “Lock-Up Period”), the Investor and its Affiliates will not, directly or indirectly, (a) purchase or otherwise acquire beneficial ownership of, or sell, assign, transfer, convey, pledge, hypothecate or otherwise encumber or dispose of any interest in, any Equity Securities (or engage in any Hedging Transaction (as hereinafter defined)) or (b) offer, agree or publicly announce any intention to do any of the foregoing (it being understood and agreed that the foregoing restrictions are expressly intended to preclude the Investor and its Affiliates from directly or indirectly engaging in any transaction that is designed to, or reasonably can be expected to lead to or result in, any of the foregoing during the Lock-Up Period, even if it involves an acquisition or disposition of securities by any person other than the Investor and its Affiliates). For purposes of this Agreement, “Hedging Transaction” means any short sale (whether or not against the box) or any purchase, sale, acquisition or grant of any right (including any put or call option or pursuant to any swap or similar arrangement) with respect to any Equity Securities or any other securities (other than a broad-based market index published by an independent third party) that relate to or derive any significant part of their value from any Equity Securities.

4.3 Transfer Restrictions.

(a) Restrictions on Transfer. Except as specified in Section 4.3(b), the Investor shall not, directly or indirectly, sell, assign, transfer, convey, pledge, hypothecate or otherwise encumber or dispose of any interest in, or engage in a Hedging Transaction or offer, agree or publicly announce any intention to do any of the foregoing with respect to (collectively, “Transfer”), any of the Purchased Securities or Voting Shares issued or issuable upon conversion of the Purchased Securities, in each case without the Company’s prior written approval.

(b) Permitted Transfers. The Investor shall be permitted:

(i) to Transfer any Purchased Securities (or Voting Shares issued or issuable upon conversion of the Purchased Securities) at any time following the earlier of (x) any Standstill Termination Event and (y) the date that is one year after the Closing Date, but then only (A) in a privately negotiated transaction to a person who represents that it (1) is not a Competitor (as defined below) (other than a Permitted Financial Intermediary), (2) is not seeking and does not propose to acquire control of the Company and (3) together with its Affiliates does not beneficially own prior to such Transfer, and will not in such Transfer acquire beneficial ownership of, 5.0% or more of the issued and outstanding Voting Shares or (B) in a registered public offering, pursuant to Rule 144 under the Securities Act or otherwise in the public market unless, in the case of this clause (B), the Investor has directed that the Transfer be made (directly or indirectly) to the account of a person who the Investor knows is a Competitor (other than a Permitted Financial Intermediary), is seeking or proposing to make an acquisition of the kind described in clause (A)(2) above or (together with its Affiliates) beneficially owns prior to such Transfer or in such Transfer is acquiring beneficial ownership, of 5.0% or more of the issued and outstanding Voting Shares; or

(ii) to Transfer any Purchased Securities (or Voting Shares issued or issuable upon conversion of the Purchased Securities) at any time to any of its controlled Affiliates (a “Permitted Transferee”) but only if, prior to the Transfer, the Permitted Transferee agrees in writing for the benefit of the Company (in the form attached hereto as Annex J) to be bound by the provisions of this Article IV (and Article V in so far as relevant thereto) with respect to the Transferred securities;

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provided that the Permitted Transferee shall be permitted to own such Transferred securities (or Voting Shares issued or issuable upon conversion of the Transferred securities) only so long as such Permitted Transferee shall be a controlled Affiliate of the Investor and upon ceasing to be such shall transfer such security pursuant to this clause (ii); provided further that no such Transfer shall relieve the Investor of its obligations under this Agreement.

At least 5 days prior to the Transfer of any Purchased Securities (or Voting Shares issued or issuable upon conversion of the Purchased Securities), the Investor shall deliver a written notice (the “Transfer Notice”) to the Company specifying (a) the number of Purchased Securities (or such Voting Shares) the Investor wishes to Transfer, (b) if known, the identity of the transferee and (c) the proposed timing and method of such transfer and the proposed purchase price. No Transfer shall be effected pursuant to this Section 4.3 unless and until the Company has had a reasonable opportunity to review the proposed terms of the Transfer and has received from the Investor and/or transferee such evidence and other assurances that the proposed Transfer would comply with this Agreement (and the Registration Agreement) as the Company may reasonably request. Other than pursuant to Transfers to Permitted Transferees, the rights of the Investor under this Agreement (including Section 3.7) are not assignable to and will not be assumed by the transferee upon any Transfer of the Purchased Securities.

As used herein, “Competitor” shall mean, at any time, any person (x) who is identified on Schedule 4.3(b), (y) who is not identified on Schedule 4.3(b) but who in any fiscal year ending after the date hereof (but not in any fiscal year ended prior to the date hereof) derived more than 25% of such person’s aggregate revenues from the business of providing brokerage, execution or clearing services to third parties with respect to any of the following: (1) exchange-listed futures and options, (2) cash equities and bonds, (3) non-exchange listed derivatives relating to equities, fixed income or commodities, including contract-for-difference and spread trading or (4) foreign exchange or (z) who is not identified on Schedule 4.3(b) but who in any fiscal year ending after the date hereof (but not in any fiscal year ended prior to the date hereof) derived revenues from the business described in clauses (y)(1) and (3) in an amount equal to more than 50% of the aggregate revenues of the Company in its most recent fiscal year ended prior to such time.

As used herein, “Permitted Financial Intermediary” shall mean any financial intermediary who acquires the Transferred securities (or an interest therein) with a view to distribution, trading or hedging such securities in the ordinary course of its business.

4.4 Purchase for Investment. The Investor acknowledges and agrees that the Purchased Securities have not been registered under the Securities Act or under any state or foreign securities laws and are being issued solely to the Investor in reliance upon an exemption from registration under the Securities Act pursuant to Section 4(2) thereof. The Investor (i) is acquiring the Purchased Securities solely for investment with no present intention to distribute any of the Purchased Securities to any person in violation of the Securities Act or any other applicable securities laws, (ii) will not Transfer any of the Purchased Securities or Voting Shares issued or issuable upon conversion of the Purchased Securities except in compliance with the registration requirements or exemption provisions of the Securities Act and any other applicable securities laws and with Section 12 of the Registration Agreement, (iii) has such knowledge and experience in financial and business matters and in investments of this type that it is capable of evaluating the merits and risks of the Purchase and of making an informed investment decision, (iv) is able to bear the economic risk of the Purchase and at the present time is able to afford a complete loss of such investment and (v) is an “accredited investor” as such term is defined in Rule 501 of Regulation D of the U.S. Securities Act of 1933.

4.5 Legend. The Investor agrees that all certificates or other instruments representing Purchased Securities (or Voting Shares issued or issuable upon conversion of the Purchased Securities) will bear a legend substantially to the following effect:

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PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT, AND IN ACCORDANCE WITH ALL APPLICABLE U.S., STATE AND OTHER SECURITIES LAWS. THIS CERTIFICATE IS ISSUED PURSUANT TO AND IS SUBJECT TO THE RESTRICTIONS ON TRANSFER AND OTHER PROVISIONS OF AN INVESTMENT AGREEMENT AND A REGISTRATION RIGHTS AGREEMENT, EACH DATED AS OF [•], 2008 BETWEEN THE ISSUER OF THESE SECURITIES AND THE INVESTOR REFERRED TO THEREIN, COPIES OF WHICH ARE ON FILE WITH THE ISSUER. THE SECURITIES REPRESENTED BY THIS INSTRUMENT MAY NOT BE SOLD OR OTHERWISE TRANSFERRED EXCEPT IN COMPLIANCE WITH SAID AGREEMENTS, AND ANY SALE OR OTHER TRANSFER NOT IN COMPLIANCE WITH SAID AGREEMENTS WILL BE VOID.

As and when provided in Section 11 of the Registration Agreement, the Company shall issue new certificates or other instruments representing Purchased Securities (or Voting Shares issued or issuable upon conversion of the Purchased Securities) that do not contain a legend restricting transfer.

4.6 Indemnity.

(a) The Company agrees to indemnify and hold harmless each of the Investor and its Affiliates and each of their respective officers, directors, partners, employees and agents, and each person who controls the Investor within the meaning of the Exchange Act and the regulations thereunder, to the fullest extent lawful, from and against any and all actions, suits, claims, proceedings, costs, losses, liabilities, damages, expenses (including reasonable attorneys’ fees and disbursements) (collectively, “Losses”) arising out of or resulting from (1) any inaccuracy in or breach of the Company’s representations or warranties in this Agreement or (2) the Company’s breach of agreements or covenants made by the Company in this Agreement.

(b) The Investor agrees to indemnify and hold harmless each of the Company and its Affiliates and each of their respective officers, directors, partners, employees and agents, and each person who controls the Company within the meaning of the Exchange Act and the regulations thereunder, to the fullest extent lawful, from and against any and all Losses arising out of or resulting from (1) any inaccuracy in or breach of the Investor’s representations or warranties in this Agreement or (2) Investor’s breach of agreements or covenants made by the Investor in this Agreement.

(c) A party entitled to indemnification hereunder (each, an “Indemnified Party”) shall give written notice to the party indemnifying it (the “Indemnifying Party”) of any claim with respect to which it seeks indemnification within 10 business days after the discovery by such Indemnified Party of any matters giving rise to a claim for indemnification; provided that the failure of any Indemnified Party to give notice as provided herein shall not relieve the Indemnifying Party of its obligations under this Section 4.6 unless and to the extent that the Indemnifying Party shall have been actually prejudiced by the failure of such Indemnified Party to so notify such party. Such notice shall describe in reasonable detail such claim. The Indemnifying Party shall be entitled to assume, conduct and control, through counsel of its own choosing and at its own expense, the settlement or defense of any such action, suit, claim or proceeding brought against an Indemnified Party. Once the Indemnifying Party has duly assumed the defense of any such action, suit, claim or proceeding brought against an Indemnified Party, the Indemnified Party shall be entitled to participate in the defense thereof and to employ counsel separate from the counsel employed by the Indemnifying Party. The Indemnified Party’s participation in any such defense shall be at its own expense unless the Indemnifying Party and the Indemnified Party are both named parties to the proceedings and the Indemnifying Party and the Indemnified Party shall have mutually concluded in good faith that representation of both parties by the same counsel would be inappropriate due to actual or potential differing interests between them or the availability to the Indemnified Party of one or more defenses or counterclaims that are inconsistent with one or more of those that may be available to the Indemnifying Party in respect thereof. If the Indemnifying Party assumes the defense of any claim, all Indemnified Parties shall thereafter deliver to the Indemnifying Party copies of all notices and documents (including court papers) received by the Indemnified Party relating to the claim, and each Indemnified Party shall cooperate in the defense or prosecution of such claim. Such cooperation shall include the retention and (upon the Indemnifying Party’s request) the provision to the Indemnifying Party of records and information that are reasonably

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relevant to such claim, and making employees available on a mutually convenient basis to provide additional information and explanation of any material provided hereunder. Whether or not the Indemnifying Party shall have assumed the defense of any action, suit, claim or proceeding brought against an Indemnified Party, the Indemnifying Party shall not be liable for any settlement or compromise of any action, suit, claim or proceeding effected without its written consent; provided, however, that the Indemnifying Party shall not unreasonably withhold, delay or condition its consent. The Indemnifying Party further agrees that it will not, without the Indemnified Party’s prior written consent (not to be unreasonably withheld, conditioned or delayed), settle or compromise any claim or consent to entry of any judgment in respect thereof in any pending or threatened action, suit, claim or proceeding in respect of which indemnification has been sought hereunder; provided, however, that the consent of the Indemnified Party shall not be required for any settlement or compromise that includes an unconditional release of such Indemnified Party from all liability arising out of such action, suit, claim or proceeding.

(d) For purposes of the indemnity contained in Section 4.6(a)(1) and Section 4.6(b)(1), all qualifications and limitations set forth in the parties’ representations and warranties (other than Section 2.2(j)) as to “materiality” or “Material Adverse Effect”, shall be disregarded in determining whether there shall have been any inaccuracy in or breach of any representations and warranties in this Agreement.

(e) The Company shall not be required to indemnify the Indemnified Parties pursuant to Section 4.6(a)(1), (1) with respect to any claim for indemnification if the amount of Losses with respect to such claim (including a series of related claims) are less than $250,000 (any claim involving Losses less than such amount being referred to as a “De Minimis Claim”) and (2) unless and until the aggregate amount of all Losses incurred with respect to all claims (other than De Minimis Claims) pursuant to Section 4.6(a)(1) exceed 1.0% of the purchase price for the Purchased Securities (the “Threshold Amount “), in which event the Company shall be responsible for only the amount of such Losses in excess of the Threshold Amount. The Investor shall not be required to indemnify the Indemnified Parties pursuant to Section 4.6(b)(1), (A) with respect to any De Minimis Claim and (B) unless and until the aggregate amount of all Losses incurred with respect to all claims (other than De Minimis Claims) pursuant to Section 4.6(b)(1) exceed the Threshold Amount, in which event Purchaser shall be responsible for only the amount of such Losses in excess of the Threshold Amount. The cumulative indemnification obligation of (1) the Company to the Investor and all of the Indemnified Parties affiliated with (or whose claims are permitted by virtue of their relationship with) the Investor or (2) the Investor to the Company and the Indemnified Parties affiliated with (or whose claims are permitted by virtue of their relationship with the) Company, in each case for inaccuracies in or breaches of representations and warranties, shall in no event exceed 60% of the purchase price for the Purchased Securities.

(f) Any claim for indemnification pursuant to this Section 4.6 for breach of any representation or warranty (other than the representations and warranties set forth in Sections 2.2(c), 2.2(d) and 2.2(r)) can only be brought on or prior to the second anniversary of the Closing Date; provided that if notice of a claim for indemnification pursuant to this Section 4.6 for breach of any such representation or warranty is brought prior to the end of such period, then the obligation to indemnify in respect of such breach shall survive as to such claim, until such claim has been finally resolved.

(g) The indemnity provided for in this Section 4.6 shall be the sole and exclusive monetary remedy of Indemnified Parties after the Closing for any inaccuracy of any representation or warranty or any other breach of any covenant or agreement contained in this Agreement; provided that nothing herein shall limit in any way any such party’s remedies in respect of fraud by any other party in connection with the transactions contemplated hereby. No party to this Agreement (or any of its Affiliates) shall, in any event, be liable or otherwise responsible to any other party (or any of its Affiliates) for any consequential or punitive damages of such other party (or any of its Affiliates) arising out of or relating to this Agreement or the performance or breach hereof.

(h) No investigation of the Company by the Investor, or by the Company of the Investor, whether prior to or after the date hereof shall limit any Indemnified Party’s exercise of any right hereunder or be deemed to be a waiver of any such right.

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Article V

MISCELLANEOUS

5.1 Survival. The representations and warranties of the Company contained in Section 2.2 shall survive the Closing until the date two years after the Closing Date, at which time such representations and warranties shall expire; provided, however, that the representations and warranties made in Sections 2.2(c), 2.2(d) and 2.2(r) shall survive until the expiration of the applicable statute of limitations (60 days after the expiration of such statute of limitations in the case of 2.2(r)). The representations and warranties of the Investor contained in Section 2.3 shall survive the Closing until the date two years after the Closing Date, at which time such representations and warranties shall expire; provided, however, that the representations and warranties made in Section 2.3(b) and 2.3(e) shall survive the Closing until the expiration of the applicable statute of limitations. All other provisions of this Agreement shall survive the Closing until the expiration of the applicable statute of limitations.

5.2 Termination. This Agreement may be terminated at any time prior to the Closing:

(a) by either the Investor or the Company if the Closing shall not have occurred by the 120^thcalendar day following the date of this Agreement; provided, however, that in the event the Closing has not occurred by such 120 ^th calendar day, the parties will consult in good faith to determine whether to extend the term of this Agreement, it being understood that the parties shall be required to consult only until the fifth day after such 120^th calendar day and not be under any obligation to extend the term of this Agreement; provided, further, that the right to terminate this Agreement under this Section 5.2(a) shall not be available to any party whose breach of any representation or warranty or failure to perform any obligation under this Agreement shall have caused or resulted in the failure of the Closing to occur on or prior to such date;

(b) by either the Investor or the Company in the event that any Regulatory Entity shall have issued an order, decree or ruling or taken any other action, enjoining or otherwise prohibiting the transactions contemplated by this Agreement and such order, decree, ruling or other action shall have become final and nonappealable; or

(d) by the Company, in the event that the Company delivers to the Investor a commitment letter for a debt financing intended to satisfy the condition in clause (1) of Section 1.3(e)(iv) that the Company is, in good faith, prepared to execute, and, within 5 business days the Investor delivers a written notice to the Company stating that the debt financing described in such commitment letter will not meet the conditions required in clause (1) of Section 1.3(e)(iv), provided, however, that in such case the Company shall make any payments to the Investor as would be required by Section 5.5 had the Closing occurred.

In the event of termination of this Agreement as provided in this Section 5.2, this Agreement shall forthwith become void and there shall be no liability on the part of either party hereto, except that nothing herein shall relieve either party from liability for any breach of this Agreement prior to termination.

5.3 Amendment. No amendment or waiver of any provision of this Agreement will be effective unless made in writing and signed by a duly authorized representative of each party.

5.4 Waiver of Conditions. The conditions to each party’s obligation to consummate the Purchase are for the sole benefit of such party and may be waived by such party, in whole or in part, to the extent permitted by applicable law. No such waiver will be effective unless it is in a writing signed by a duly authorized representative of the waiving party that makes express reference to the provision or provisions subject to such waiver.

5.5 Expenses. Upon the Closing or the termination of this Agreement under 5.2(a) (unless the Investor has breached this Agreement) or 5.2(d), the Company shall reimburse the Investor on demand for reasonable documented out-of-pocket fees and expenses, including the fees and expenses of attorneys, accountants and consultants employed by it, in connection with the transactions contemplated hereby, submitted to the Company at least two business days prior to the Closing Date; provided that such reimbursement pursuant to this Section 5.5 shall not exceed the amount set forth in Schedule 5.5.

5.6 Counterparts and Facsimile. For the convenience of the parties hereto, this Agreement may be executed in any number of separate counterparts, each such counterpart being deemed to be an original instrument, and all such counterparts will together constitute the same agreement. Executed signature pages to this Agreement may be delivered by facsimile and such facsimiles will be deemed as sufficient as if actual signature pages had been delivered.

5.7 GOVERNING LAW; SUBMISSION TO JURISDICTION, ETC. THE TRANSACTION DOCUMENTS WILL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK APPLICABLE TO CONTRACTS MADE AND TO BE PERFORMED ENTIRELY WITHIN SUCH STATE (PROVIDED THAT THE CERTIFICATE OF DESIGNATIONS AND MATTERS RELATING TO THE COMPANY’S MEMORANDUM OF ASSOCIATION AND BYE-LAWS WILL BE GOVERNED BY THE LAWS OF BERMUDA). IN CONNECTION WITH ANY DISPUTE, CONTROVERSY OR CLAIM ARISING OUT OF OR RELATING TO THE TRANSACTION DOCUMENTS, OR THE VALIDITY, INTERPRETATION, BREACH OR TERMINATION OF ANY TRANSACTION DOCUMENTS, INCLUDING CLAIMS SEEKING REDRESS OR ASSERTING RIGHTS UNDER ANY LAW, EACH OF THE PARTIES HERETO AGREES (A) TO SUBMIT TO THE PERSONAL JURISDICTION OF THE STATE OR FEDERAL COURTS IN

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THE BOROUGH OF MANHATTAN, THE CITY OF NEW YORK, (B) THAT EXCLUSIVE JURISDICTION AND VENUE SHALL LIE IN SUCH STATE OR FEDERAL COURTS IN THE BOROUGH OF MANHATTAN AND EACH PARTY IRREVOCABLY AND UNCONDITIONALLY WAIVES AND AGREES NOT TO PLEAD OR CLAIM IN ANY SUCH COURT THAT SUCH DISPUTE, CONTROVERSY OR CLAIM BROUGHT IN SUCH COURT HAS BEEN BROUGHT IN AN INCONVENIENT FORUM AND (C) THAT NOTICE MAY BE SERVED UPON SUCH PARTY AT THE ADDRESS AND IN THE MANNER SET FORTH FOR SUCH PARTY IN SECTION 5.9.

5.8 Remedies. In addition and supplementary to other rights and remedies existing in a party’s favor under this Agreement, such party may apply to a court of law or equity of competent jurisdiction for specific performance and/or injunctive or other equitable relief in order to enforce or prevent any breach or violation of any provision of this Agreement. All such rights and remedies shall, to the extent permitted by applicable law, be cumulative and the existence, assertion, pursuit or exercise of any thereof by such party shall not preclude such party from exercising or pursuing any other rights or remedies available to it.

5.9 Notices. Any notice, request, instruction or other document to be given hereunder by any party to the other will be in writing and will be deemed to have been duly given (a) on the date of delivery if delivered personally, or by facsimile or e-mail, upon confirmation of receipt, or (b) on the second business day following the date of dispatch if delivered by a recognized next day courier service. All notices hereunder shall be delivered as set forth below, or pursuant to such other instructions as may be designated in writing by the party to receive such notice.


(A) If to the Investor:

		J.C. Flowers II L.P. c/o J.C. Flowers & Co. LLC 717 5^th Avenue, 26^th Floor New York, New York 10022

Attention: Facsimile: E-mail:

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with a copy to:

		Debevoise & Plimpton LLP New York, NY 10022

Attention: Facsimile: E-mail:		Gregory V. Gooding, Esq. (212) 521-7870 ggooding@debevoise.com

(B) If to the Company:

		MF Global Ltd. 717 Fifth Ave., 9^th Floor New York, New York 10022

Attention: Facsimile: E-mail:		General Counsel (212) 589-6236 hschneider@mfglobal.com

with a copy to:

		Sullivan & Cromwell LLP 125 Broad Street New York, New York 10004

Attention: Facsimile: E-mail:		David B. Harms (212) 558-3588 harmsd@sullcrom.com

5.10 Entire Agreement, Etc. This Agreement (including the Annexes), the other Transaction Documents and the confidentiality agreement previously entered into between the Company and the Investor (or its Affiliate) in connection with the transactions contemplated herein constitute the entire agreement, and supersede all other prior agreements, understandings, representations and warranties, both written and oral, between the parties, with respect to the subject matter hereof. This Agreement will not be assignable by any party without the prior written consent of the other party (any attempted assignment in contravention hereof being null and void); provided, however, that rights but not the obligations under this Agreement may be assigned by the Investor to any controlled Affiliate of the Investor upon written notice to the Company. The Investor agrees to treat all confidential information provided by the Company in connection with the transactions contemplated by the Transaction Documents as confidential information subject to the confidentiality provisions of the previously signed confidentiality agreement referenced above.

5.11 Definitions of “subsidiary” and “Affiliate”. (a) When a reference is made in this Agreement to a subsidiary of a person, the term “subsidiary” means those corporations, associations and other entities of which such person owns or controls more than 50% of the outstanding equity securities either directly or through entities as to each of which more than 50% of the outstanding equity securities is owned directly or indirectly by its parent.

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(b) The term “Affiliate” means, with respect to any other person, any person directly or indirectly controlling, controlled by or under common control with, such person. For purposes of this definition, “control” when used with respect to any person means the possession, directly or indirectly, of the power to cause the direction of management and/or policies of such person, whether through the ownership of voting securities by contract or otherwise. References to any controlled Affiliate of the Investor shall mean a controlled Affiliate of J.C. Flowers & Co. LLC and shall include any investment fund or partnership the managing member or general partner of which is J.C. Flowers & Co. LLC or a subsidiary of J.C. Flowers & Co. LLC.

5.12 Severability. If any provision of this Agreement or a Transaction Document, or the application thereof to any person or circumstance, is determined by a court of competent jurisdiction to be invalid, void or unenforceable, the remaining provisions hereof, or the application of such provision to persons or circumstances other than those as to which it has been held invalid or unenforceable, will remain in full force and effect and shall in no way be affected, impaired or invalidated thereby, so long as the economic and legal substance of the transactions contemplated hereby are not affected in any manner materially adverse to any party. Upon such determination, the parties shall negotiate in good faith in an effort to agree upon a suitable and equitable substitute provision to effect the original intent of the parties.

5.13 No Third-Party Beneficiaries. Nothing contained in this Agreement, expressed or implied, is intended to confer upon any person or entity other than the Company and the Investor any benefits, rights or remedies.

IN WITNESS WHEREOF, this Agreement has been duly executed and delivered by the duly authorized officers of the parties hereto as of the date first herein above written.


MF GLOBAL LTD.

By:		/s/ Kevin R. Davis
		Name: Kevin R. Davis
		Title: Chief Executive Officer

Signature Page to Investment Agreement

(Company)


J.C. FLOWERS II L.P.

By: JCF Associates II L.P., its General Partner

By: JCF Associates II Ltd., its General Partner

By:		/s/ David Schamis
		Name: David Schamis
		Title: Authorized Person

Signature Page to Investment Agreement

(Investor)

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EX-7.02 4 dex702.htm AMENDMENT NO.1 TO THE INVESTMENT AGREEMENT Amendment No.1 to the Investment Agreement

Exhibit 7.02

AMENDMENT NO. 1

TO THE

INVESTMENT AGREEMENT

This Amendment No. 1, dated as of June 10, 2008 (this “Amendment”), among MF Global Ltd., a Bermuda exempted company (the “Company”), and J.C. Flowers II L.P. (the “Investor”), amends the Investment Agreement (the “Investment Agreement”), dated as of May 20, 2008, between the Company and the Investor. Capitalized terms used but not otherwise defined herein shall have the respective meanings given to them in the Investment Agreement.

WHEREAS, Section 5.3 of the Investment Agreement permits the Investment Agreement to be amended by a written agreement executed by the Company and the Investor; and

WHEREAS, the Company and the Investor desire to amend the Investment Agreement to reflect certain agreements reached between them.

NOW, THEREFORE, in consideration of the premises, and of the mutual representations, warranties, covenants and agreements contained in this Amendment and the Investment Agreement, the parties hereto hereby agree as follows:

1. Amendment and Restatement of Recital B. Recital B of the Investment Agreement is hereby amended and restated to read in its entirety as follows:

“B. The Issuances. The Company currently intends (i) to issue and sell an amount of a series of its preference shares having the designation, powers, preferences and rights set forth in a certificate of designations in the form attached as Annex B (the “Certificate of Designations” and such series of preference shares, the “Series A Shares”) or other securities in one or more private placements and/or public offerings and (ii) to issue and sell to the Investor, and the Investor intends to purchase from the Company, a number (the “Actual Number”) of Series A Shares equal to (x) the maximum number of Series A Shares specified in Annex A (the “Maximum Number”) minus (y) such number of Series A Shares, if any, plus such number of other securities, if any, as may be issued and sold in any offerings of the kind referenced in clause (i) above; provided that the Actual Number shall not be less than the minimum number specified in Annex A (the “Minimum Number”) and provided, further, that the number of any securities other than Series A Shares shall be calculated for this purpose by dividing the aggregate purchase price of such securities sold by the Company by $100. For purposes of this Agreement, the term “Transaction Documents” refers collectively to this Agreement, the Registration Agreement (as hereinafter defined) and the Certificate of Designations, in each case as amended, modified or supplemented from time to time in accordance with their respective terms.”

2. Amendment and Restatement of Section 1.1. Section 1.1 (Other Offerings) of the Investment Agreement is hereby amended and restated to read in its entirety as follows:

“1.1 Other Offerings. The Company has the right to issue and sell Series A Shares or other securities in one or more private placements and/or public offerings from time to time and at any time after the date hereof but before the Closing Date on such terms and conditions as it shall determine in its sole discretion (each such transaction, an “Offering”); provided that the terms and conditions of any Offering taken as a whole shall not be more favorable to the purchasers than those relating to the Purchase (as defined below) and the aggregate number of Series A Shares issued in such Offerings and the Purchased Securities shall not be greater than 7,500,000. In addition, each Offering, other than an Offering of Series A Shares, shall be subject to Section 3.11 as applicable.”

3. Amendment of Section 1.3(e)(iv). Section 1.3(e)(iv) of the Investment Agreement is hereby amended by adding to the end of Section 1.3(e)(iv) the following:

“It is understood and agreed that the Company may engage in one or more of the transactions referenced in this Section 1.3(e)(iv), and that the Company shall not be deemed to be in breach of its representations, warranties or agreements set forth in Sections 2.2(b), (i) or (j) or Section 3.9, as of the Closing or any other time, by reason of engaging or proposing to engage in any such transactions, including by reason of the authorization or issuance of any additional equity or other securities, the incurrence of any indebtedness or the execution and delivery of any agreements in connection therewith that are not specifically referenced in those Sections or in the Schedules to this Agreement.”

4. Amendment and Restatement of Section 3.9. Section 3.9 (Conduct of Business) of the Investment Agreement is hereby amended and restated to read in its entirety as follows:

“3.9 Conduct of Business. Prior to the earlier of the Closing Date and the termination of this Agreement pursuant to Section 5.2 (the “Pre-Closing Period”), unless the Investor shall otherwise consent (such consent not to be unreasonably withheld, delayed or conditioned), the Company shall, and shall cause its subsidiaries to, use commercially reasonable efforts to carry on its business in the ordinary course of business and use reasonable best efforts to maintain and preserve its and such subsidiaries’ business (including its organization, assets, properties, goodwill and insurance coverage) and preserve its business relationships; provided that nothing in this sentence shall limit or require any actions that the board of directors of the Company may, in good faith, determine to be inconsistent with their duties or the Company’s obligations under applicable law or imposed by any Regulatory Entity. During the Pre-Closing Period, (i) the Company shall not merge or consolidate into, or sell, transfer or lease all or substantially all of its property or assets to, any other party unless the

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successor, transferee or lessee party, as the case may be (if not the Company), expressly assumes the due and punctual performance and observance of each and every covenant and condition of this Agreement to be performed and observed by the Company, (ii) the Company shall not declare or pay any dividend or distribution on the Common Stock and (iii) if the Company takes any action that would require any antidilution adjustment to be made under the Certificate of Designations as if issued on the date of this Agreement, the Company shall make appropriate adjustments such that the Investor will receive the benefit of such transaction as if the Purchased Securities had been outstanding as of the date of such action. It is understood and agreed that this Section 3.9 does not limit or otherwise apply to any financing referenced in Section 1.3(e)(iv), including any such financing in the form of a rights offering.”

5. Investment Agreement in Effect. Except as hereby amended, the Investment Agreement shall remain in full force and effect. In the event of any conflict or inconsistency between the provisions of this Amendment and the provisions of the Investment Agreement, the provisions of this Amendment shall control.

6. References. All references to “Agreement” or “Investment Agreement” contained in the Investment Agreement shall be deemed to be references to the Investment Agreement, as amended by this Amendment.

7. Incorporation. Article V of Investment Agreement is hereby incorporated by reference into this Amendment as if set forth in its entirety herein.

[Signature Page Follows]

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IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed as of the date first above written.


MF GLOBAL LTD.

By:		/s/ Jacqueline Giammarco
		Name: Jacqueline Giammarco
		Title: Assistant General Counsel


J.C. FLOWERS II L.P.

By:		JCF Associates II L.P., its General Partner

By:		JCF Associates II Ltd., its General Partner

By:		/s/ David Schamis
		Name: David Schamis
		Title: Managing Director

EX-7.03 5 dex703.htm LETTER AGREEMENT, DATED AS OF JUNE 27,2008 Letter Agreement, dated as of June 27,2008

Exhibit 7.03

June 27, 2008

J.C. Flowers II L.P.

c/o J.C. Flowers & Co. LLC

717 5th Avenue, 26th Floor

New York, New York 10022

Attention: David Schamis

Ladies and Gentlemen:

With this letter we are providing you with (i) the final offering memorandum related to the offer of our 9.75% non-cumulative convertible preference shares, series B (the “Series B Shares”), dated as of June 20, 2008, (ii) the final offering memorandum related to the offer of our 9.0% convertible senior notes due 2038 (the “Notes”), dated as of June 20, 2008, (iii) the Purchase Agreement by and among MF Global Ltd. (the “Company”) and Banc of America Securities LLC, Morgan Stanley & Co. Incorporated, Citigroup Global Markets Inc. and JP Morgan Securities Inc. (the “Initial Purchasers”) related to the offering of the Series B Shares, dated June 20, 2008 and (iv) the Purchase Agreement by and among the Company and the Initial Purchasers related to the offering of the Notes, dated June 20, 2008. Copies of these documents are enclosed. The offer of the Series B Shares and the Notes are herein entitled the “Offering”.

This will confirm our understanding and agreement with you that the Offering on the terms outlined in these documents will meet the requirements for, and thus qualify as, $150 million of equity financing proceeds and $150 million of debt/equity financing proceeds under Section 1.3(e)(iv) of the Investment Agreement, dated May 20, 2008, as amended, between you and us (the “Investment Agreement”), and that, after giving effect to the agreements in this letter, the terms and conditions of the Offering taken as a whole are no more favorable to the purchasers of the Series B Shares and the Notes than those relating to the Purchase. This also confirms our understanding with you that, effective upon the Closing, as a result of the Offering, (i) the annual Quarterly Dividend Rate will be 10.725%, (ii) the Reset Payment will be $26,700,000 and (iii) the Company will make an additional make-whole payment in light of the proviso in Section 1.1 of the Investment Agreement, of $9.6 million.

It is further agreed that the two payments referred to in clauses (ii) and (iii) in the prior paragraph, aggregating $36.3 million, will be made at the Closing (but only if the Closing occurs) and may be made, at the Company’s option, (x) by means of a dollar-for-dollar reduction of the amount payable by the Investor at the Closing pursuant to Section 1.3(b) of the Investment Agreement (provided that the proceeds from the sale of the Purchased Securities shall be deemed to equal the aggregate liquidation preference thereof for the purpose of Section 1.3(e)(iv) of the Investment Agreement), (y) Common Shares or (z) a combination of both, as shall be notified by the Company to the Investor at least 5 business days prior to the Closing. If any portion of such payments is made in the form of Common Shares, the Common Shares will be valued for this purpose at $8.4245 per share (which represents 95% of the average of the volume-weighted average prices of the Common Shares on the NYSE on each of the 10 trading days ending on

and including June 19, 2008). Any Common Shares that the Company delivers at the Closing in satisfaction of such payments (the “Payment Shares”), plus any Common Shares issued pursuant to Section 4(a)(ii) of the Certificate of Designations in payment of quarterly dividends on the Purchased Securities (“Dividend Shares”), shall be subject to the transfer restrictions and other provisions set forth in Sections 4.3, 4.4 and 4.5 of the Investment Agreement, provided that notwithstanding the provisions of clause (i) of Section 4.3(b), the Payment Shares and Dividend Shares may be Transferred at any time after the later of the Closing and September 20, 2008 if the Transfer meets the requirements of either of subclause (A) or (B) of clause (i) of Section 4.3(b) and provided, further, that no Transfer Notice shall be required in respect of any Transfer of Dividend Shares under Rule 144. In addition, the Payment Shares and any Dividend Shares shall be treated as Registrable Shares for all purposes of the Registration Agreement to be executed by the parties at the Closing, including Section 11 thereof. Without limiting the foregoing, in addition to the rights provided for in the form of Registration Rights Agreement attached as Annex C to the Investment Agreement the Investor may make one Registration Request for an S-3 Shelf Registration covering only the Payment Shares and any Dividend Shares received by the Investor (in whole only) at any time after the later of the Closing and September 20, 2008 and prior to the Start Date. Any such registration requested pursuant to the prior sentence shall be effected in accordance with and subject to the provisions of the Registration Agreement as they apply to S-3 Shelf Registrations, except that such request shall not count against the limit on Registration Requests permitted under the Registration Agreement and the Minimum Amount for any underwritten offering of Payment Shares and Dividend Shares pursuant to such registration prior to the Start Date shall be $50 million. Terms used in the prior three sentences that are also used in the Registration Agreement have the meanings given them in that Agreement.

We have previously provided you a copy of the commitment letter, fee letter and arrangers fee letter, each dated May 23, 2008, from JPMorgan Chase Bank, N.A., Citibank, N.A., and Bank of America, N.A. to MF Global Ltd. and MF Global Finance Europe Limited (together, the “Bank Financing Documents”) relating to a proposed term loan facility of $450 million. Copies of these letters are attached.

This will confirm our understanding and agreement with you that any financings we obtain on the terms outlined in the Bank Financing Documents will meet the requirements for, and thus qualify as, bank financing proceeds equal to the principal amount borrowed (without reduction for fees or other amounts) under Section 1.3(e)(iv) of the Investment Agreement.

Terms not defined herein shall have the meaning set forth in the Investment Agreement or (as specified herein) the Registration Agreement. References herein to the Investment Agreement and the Registration Agreement mean such agreements as they may be amended from time to time. This letter agreement shall be governed by New York law.

Please confirm your understanding of and agreement with the foregoing by signing below.


Very truly yours, MF Global Ltd.

By:		/s/ Howard Schneider
		Name: Howard Schneider
		Title: General Counsel

Accepted and agreed as of the date of this letter:

J.C. Flowers II L.P.

By: JCF Associates II L.P., its General Partner

By: JCF Associates II Ltd., its General Partner


By:		/s/ David Schamis
		Name: David Schamis
		Title: Managing Director

EX-7.04 6 dex704.htm LETTER AGREEMENT, DATED AS OF JULY 17,2008 Letter Agreement, dated as of July 17,2008

Exhibit 7.04

July 17, 2008

J.C. Flowers II L.P.

c/o J.C. Flowers & Co. LLC

717 5th Avenue, 26th Floor

New York, New York 10022

Attention: David Schamis

Ladies and Gentlemen:

Reference is hereby made to the Investment Agreement between MF Global Ltd. (the “Company”) and J.C. Flowers II L.P. (the “Company”), dated May 20, 2008, amended on June 10, 2008 and supplemented by a letter agreement dated June 27, 2008 (the “Investment Agreement”).

It is understood and agreed that, pursuant to Section 1.3(a) of the Investment Agreement, the Closing will occur on July 18, 2008, or on the first day thereafter on which the conditions to the obligations of each party set forth in Section 1.3(c), (d) and (e) of the Investment Agreement have been fulfilled or waived as provided therein (subject to Section 5.2 thereof).

Pursuant to Section 3.11(c) of the Investment Agreement, Quarterly Dividends shall accrue on the Series A Shares beneficially owned by the Investor or any controlled Affiliate of the Investor at a rate of 10.725% per annum. Such Quarterly Dividends shall be payable if, as and when Quarterly Dividends are payable under the Certificate of Designations. Any Series A Shares that cease to be beneficially owned by the Investor or any of its controlled Affiliates shall accrue Quarterly Dividends at the annual rate specified in the Certificate of Designations from and after the date that such Series A Shares cease to be beneficially owned by the Investor or any of such controlled Affiliates. Subject only to the adjustment of the annual rate specified above, the provisions of the Certificate of Designations shall apply to the Series A Shares in all respects, and nothing in this paragraph shall be deemed to amend or be a part of the Certificate of Designations or the Series A Shares. For the avoidance of doubt, the annual rate at which Quarterly Dividends accrue on the Series A Shares beneficially owned by the Investor or any of its controlled Affiliates shall be subject to further upward adjustment on the basis set forth in Section 3.11(c) of the Investment Agreement if, after the date hereof and prior to the end of the period referred to in the first sentence of such Section 3.11(c), the Company issues and sells any preference shares with an annual dividend rate greater than 9.75%.

It is understood and agreed that the initial purchasers’ option to purchase up to an additional $60 million aggregate principal amount of the 9.00% Convertible Senior Notes due 2038, which is part of the Offering referenced in the letter agreement between the Company and J.C. Flowers, dated June 27, 2008 (the “Letter Agreement”), is being amended to extend the period in which the option may be exercised to September 18, 2008, and that the Letter Agreement otherwise remains in effect.

Terms not defined herein shall have the meaning set forth in the Investment Agreement. This letter agreement shall be governed by New York law.

Please confirm your understanding of and agreement with the foregoing by signing below.


Very truly yours,
MF Global Ltd.

By:		/s/ Jacqueline Giammarco
		Name: Jacqueline Giammarco
		Title: Assistant General Counsel

Accepted and agreed as of the date of this letter:

J.C. Flowers II L.P.

By: JCF Associates II L.P., its General Partner

By: JCF Associates II Ltd., its General Partner


By:		/s/ Kristin H. Johnson
		Name: Kristin H. Johnson
		Title: Vice President

EX-7.05 7 dex705.htm CERTIFICATE OF DESIGNATIONS Certificate of Designations

Exhibit 7.05

CERTIFICATE OF DESIGNATIONS

6% CUMULATIVE CONVERTIBLE PREFERENCE SHARES, SERIES A

MF GLOBAL LTD.

MF GLOBAL LTD., a Bermuda exempted company (the “Company”), hereby certifies that:

1. The Bye-laws and Memorandum of Association of the Company fix the total number of shares of all classes of share capital that the Company shall have the authority to issue at one billion (1,000,000,000) common shares, par value $1.00 per share, and two hundred million (200,000,000) preference shares, par value $1.00 per share.

2. The Bye-laws expressly grant to the Board of Directors of the Company (the “Board of Directors”) authority to provide for the issuance of the preference shares in series, and to establish from time to time the number of shares to be included in each such series and to fix the designation, powers, preferences and rights of the shares of each such series and the qualifications, limitations or restrictions thereof.

3. Pursuant to the authority conferred upon the Board of Directors by the Bye-laws, the Board of Directors, by action duly taken on May 19, 2008 and by the Pricing Committee of the Board of Directors on July 17, 2008, adopted resolutions (i) authorizing the issuance and sale, in one or more transactions, of up to 3,000,000 of the Company’s preference shares and (ii) authorizing this final form of the Certificate of Designations of 6% Cumulative Convertible Preference Shares, Series A establishing the number of shares to be included in the series of preference shares and fixing the designation, powers, preferences and rights of this Series A preference shares and the qualifications, limitations or restrictions thereof, in addition (to the extent provided herein) to those set forth in the Memorandum of Association and Bye-laws of the Company, as follows:

Section 1.

Designation.

The designation of the series of preference shares shall be “6% Cumulative Convertible Preference Shares, Series A” (the “Convertible Preference Shares”). Each Convertible Preference Share shall be identical in all respects to every Convertible Preference Share. The Convertible Preference Shares will rank equally with Parity Shares, if any, and will rank senior to Junior Shares and will rank junior to Senior Shares, if any, with respect to the payment of dividends and/or the distribution of assets in the event of any voluntary or involuntary liquidation, dissolution or winding up of the affairs of the Company.

Section 2.

Number of Shares.

The number of authorized Convertible Preference Shares shall be 3,000,000. That number from time to time may be increased (but not in excess of the total number of authorized preference shares) or decreased (but not below the number of Convertible Preference Shares then outstanding) by further resolution duly adopted by the Board of Directors or any duly authorized committee thereof stating that such increase or reduction, as the case may be, has been so authorized. The Company shall have the authority to issue fractions of Convertible Preference Shares.

Section 3.

Definitions. As used herein with respect to Convertible Preference Shares:

“Affiliate” of any specified Person means any other Person directly or indirectly controlling or controlled by or under direct or indirect common control with such specified Person. For the purposes of this Certificate of Designations, “control” when used with respect to any specified Person, means the power to direct the management and policies of such Person, directly or indirectly, whether through the ownership of voting securities, by contract or otherwise; and the terms “controlling” and “controlled” have meanings correlative to the foregoing.

“Agent Members” has the meaning set forth in Section 22(c).

“Arrearage” shall have the meaning set forth in Section 4(c).

“Board of Directors” has the meaning set forth in paragraph 2 of the Recitals.

“Business Day” means any weekday that is not a legal holiday in New York, New York and is not a day on which banking institutions in New York, New York are authorized or required by law or regulation to be closed.

“Bye-laws” means the Bye-laws of the Company as amended from time to time.

“Closing Price” of the Common Shares on any date of determination means the last reported sale price of the Common Shares regular way on such date (or, if no such sale occurs on such date, the average of the reported closing bid and asked prices for such shares regular way on such date) on the Principal Market or, if there is no Principal Market for the Common Shares, the average of the closing bid and asked prices quoted for the Common Shares in the over-the-counter market as reported by Pink Sheets LLC or any similar organization, or if such closing prices are not so reported (or if the relevant price or prices required to be used to calculate the Closing Price as provided in this paragraph are not available in the relevant market on such date for any reason, the market price of the Common Shares on such date as determined by a nationally recognized investment banking firm retained by the Company for this purpose).

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“Common Shares” means the common shares of the Company, par value $1.00 per share, or any other shares constituting the share capital of the Company into which the common shares shall be reclassified or changed.

“Company” has the meaning set forth in the Recitals.

“Constituent Person” has the meaning set forth in Section 11(a).

“Conversion Agent” means the Transfer Agent acting in its capacity as conversion agent for the Convertible Preference Shares, and its successors and assigns.

“Conversion at the Option of the Company Date” has the meaning set forth in Section 9(c).

“Conversion Date” has the meaning set forth in Section 8(e).

“Conversion Price” at any time means, for each Convertible Preference Share, a dollar amount equal to $100 divided by the Conversion Rate.

“Conversion Rate” means for each Convertible Preference Share, 8 Common Shares, subject to adjustment as set forth in Section 10.

“Convertible Preference Shares” shall have the meaning set forth in Section 1.

“Current Market Price” as of any day means the average of the VWAP per share of the Common Shares on each of the 10 consecutive Trading Days ending on the earlier of the day in question and the day before the Ex-date or other specified date with respect to the issuance or distribution requiring such computation, appropriately adjusted to take into account the occurrence during such period of any event described in Section 10. For the purpose of calculating the Current Market Price in Section 4(a)(ii), 7 and 9, the 10 consecutive Trading Days shall end on the day before the date in question.

“Depositary” means DTC or its nominee, or any successor depositary appointed by the Company or its nominee.

“Director Acceptance Letter” has the meaning set forth in Section 12(b)(ii).

“DTC” means The Depository Trust Company.

“Exchange Property” has the meaning set forth in Section 11(a).

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

“Ex-date” when used with respect to any issuance or distribution, means the first date on which the Common Shares or other relevant securities trade without the right to receive such issuance or distribution.

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“Expiration Date” has the meaning set forth in Section 10(a)(iv).

“Expiration Time” has the meaning set forth in Section 10(a)(iv).

“Freely Tradeable” means, as of any date, with respect to Common Shares issuable upon conversion of the Convertible Preference Shares, Common Shares for which each of the following conditions is met at the time of issuance of such Common Shares to a Holder hereunder: (i) the Common Shares shall be listed or admitted to trading on the Principal Market and (ii) may be freely resold by the Holder on the Principal Market pursuant to an effective registration statement under the Securities Act (without further public disclosure by the Company) or pursuant to Rule 144 thereunder without regard to the volume and manner of sale requirements of such rule.

“Global Preference Shares” has the meaning set forth in Section 22(a).

“Holder” means, as to any Convertible Preference Shares, the Person in whose name such share is registered, which may be treated by the Company, Transfer Agent, Registrar, paying agent and Conversion Agent as the absolute owner of such share for the purpose of making payment and settling the related conversions and for all other purposes. References herein to “holders” of any preference shares of the Company shall mean, insofar as such shares are Convertible Preference Shares, the Holders thereof.

“Issue Date” shall have the meaning set forth in Section 4(a)(i).

“Junior Liquidation Shares” shall have the meaning set forth in the definition of “Junior Shares”.

“Junior Shares” means the Common Shares and any other class or series of shares of the Company now existing or hereafter authorized over which the Convertible Preference Shares have preference or priority in the payment of dividends or in the distribution of assets on any voluntary or involuntary liquidation, dissolution or winding up of the Company. Junior Shares over which the Convertible Preference Shares have preference or priority in such distribution of assets are herein called “Junior Liquidation Shares”.

“Liquidation Preference” shall have the meaning set forth in Section 5(a). References to the “liquidation preference” of any preference shares of the Company shall mean the Liquidation Preference if such preference shares are Convertible Preference Shares.

“Market Disruption Event” means, on any day when the Common Shares are listed or admitted to trading or are quoted on a securities exchange or quotation facility (whether U.S. national or regional or non-U.S.), any of the following events that occurs or continues to exist on such day:

(i) any suspension of, or limitation imposed on, trading by the Principal Market during the one-hour period prior to the close of trading for the regular trading session (or for purposes of determining the VWAP per Common Share, any period or periods aggregating one half-hour or longer during the regular trading session) on the Principal Market on such day, and whether by reason of movements in price exceeding limits permitted by the Principal Market, or otherwise, relating to the Common Shares (specifically or among other shares generally) or to futures or options contracts relating to the Common Shares (specifically or among other shares generally) on the Principal Market;

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(ii) any event that disrupts or impairs (as determined by the Company in its reasonable discretion) the ability of market participants, during the one-hour period prior to the close of trading for the regular trading session (or for purposes of determining the VWAP per Common Share, any period or periods aggregating one half-hour or longer during the regular trading session) on the Principal Market on such day, to effect transactions in, or obtain market values for, the Common Shares (specifically or among other shares generally) on the Principal Market on such day or to effect transactions in, or obtain market values for, futures or options contracts relating to the Common Shares (specifically or among other shares generally) on the Principal Market on such day; or

(iii) the principal exchange or quotation facility (whether or not the Principal Market) on which futures or options contracts relating to the Common Shares are listed or admitted to trading or quoted fails to open, or closes prior to its respective scheduled closing time, for the regular trading session on such day (without regard to after hours or any other trading outside of the regular trading session hours), unless such earlier closing time is announced by such exchange or facility at least one hour prior to the earlier of (A) the actual closing time for the regular trading session on such day and (B) the submission deadline for orders to be entered into such exchange or facility for execution at the actual closing time on such day.

“Members” shall have the meaning set forth in the Bye-laws.

“Memorandum of Association” means the Memorandum of Association of the Company as amended from time to time.

“Nonpayment” shall have the meaning set forth in Section 12(b)(i).

“Notice of Conversion at the Option of the Company” has the meaning set forth in Section 9(c).

“Officer” means the Chief Executive Officer, the Deputy Chief Executive Officer, the Chief Operating Officer, the Chief Administrative Officer, the Chief Financial Officer, the Controller, the Chief Accounting Officer, the Treasurer, any Assistant Treasurer, the General Counsel and Corporate Secretary and any Assistant Secretary of the Company.

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“Officers’ Certificate” means a certificate signed (i) by the Chief Executive Officer, the Deputy Chief Executive Officer, the Chief Operating Officer, the Chief Administrative Officer, the Chief Financial Officer, the Controller or the Chief Accounting Officer, and (ii) by the Treasurer, any Assistant Treasurer, the General Counsel, Corporate Secretary or any Assistant Secretary of the Company, and delivered to the Conversion Agent.

“Original Liquidation Preference” means $100 per share.

“Parity Dividend Shares” shall have the meaning set forth in the definition of “Parity Shares”.

“Parity Liquidation Shares” shall have the meaning set forth in the definition of “Parity Shares”.

“Parity Shares” means any class or series of shares of the Company hereafter authorized that ranks equally with the Convertible Preference Shares in the payment of dividends or in the distribution of assets on any liquidation, dissolution or winding up of the Company. Parity Shares so ranking equally in the payment of dividends are herein called “Parity Dividend Shares”. Parity Shares so ranking equally in such distribution of assets are herein called “Parity Liquidation Shares”.

“Participating Dividends” shall have the meaning set forth in Section 4(b).

“Person” means a legal person, including any individual, company, corporation, estate, body corporate, partnership, limited liability company, trust, joint venture, association or other legal entity.

“Preference Share Director” has the meaning set forth in Section 12(b)(i).

“Principal Market” means, with respect to any day on which the Common Shares are listed or admitted to trading or quoted on any securities exchange or quotation facility (whether U.S. national or regional or non-U.S.), the principal such exchange or facility on which the Common Shares are so listed or admitted or so quoted.

“Purchased Shares” has the meaning set forth in Section 10(a)(iv).

“Quarterly Dividend Payment Date” shall have the meaning set forth in Section 4(a).

“Quarterly Dividend Period” shall have the meaning set forth in Section 4(a). References herein to “dividend periods” of any preference shares of the Company shall mean, insofar as such shares are Convertible Preference Shares, the Quarterly Dividend Period.

“Quarterly Dividend Record Date” shall have the meaning set forth in Section 4(a).

“Quarterly Dividends” has the meaning set forth in Section 4(a).

“Record Date” has the meaning set forth in Section 10(d).

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“Registrar” means the Transfer Agent acting in its capacity as registrar for the Convertible Preference Shares, and its successors and assigns.

“Registration Agreement” means the Registration Rights Agreement, dated as of July 18, 2008, between the Company and J.C. Flowers II L.P.

“Regulatory Entities” means all governmental or self-regulatory authorities in the United States, Bermuda, the United Kingdom or elsewhere having jurisdiction over the Company or any of its Subsidiaries.

“Reorganization Event” has the meaning set forth in Section 11(a).

“Securities Act” means the Securities Act of 1933, as amended.

“Senior Shares” means any class or series of shares of the Company now existing or hereafter authorized that has preference or priority over the Convertible Preference Shares as to the payment of dividends or in the distribution of assets on any voluntary or involuntary liquidation, dissolution or winding up of the Company.

“Subsidiary” of any Person means those corporations, associations and other entities of which such Person owns or controls more than 50% of the outstanding equity securities either directly or through entities as to each of which more than 50% of the outstanding equity securities is owned directly or indirectly by its parent.

“Trading Day” means, for purposes of determining a VWAP or Closing Price per Common Share, a day on which the Principal Market is open for the transaction of business and on which a Market Disruption Event does not occur or exist, or if the Common Shares are not listed or admitted to trading and are not quoted on any securities exchange or quotation facility, a Business Day.

“Transfer Agent” means Computershare Trust Company, N.A. acting as Transfer Agent, Registrar, paying agent and Conversion Agent for the Convertible Preference Shares, and its successors and assigns.

“Trust” shall have the meaning set forth in Section 6(d).

“Voting Holders” shall have the meaning set forth in Section 12(b)(i).

“VWAP” per Common Share on any Trading Day means the per share volume-weighted average sale price per Common Share on the Principal Market as displayed under the heading Bloomberg VWAP on Bloomberg page “MF Equity VWAP” (or any appropriate successor page) in respect of the period from the open of trading until the close of trading on the Principal Market on such Trading Day (or if such volume-weighted average price is unavailable or not provided for any reason, or there is no Principal Market for the Common Shares, the market price of one Common Share on such Trading Day determined, using a volume-weighted average method, by

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a nationally recognized investment banking firm retained for this purpose by the Company). When used with respect to any other securities, “VWAP” shall have the meaning set forth above with references to the price per Common Share meaning the price per unit of such other securities, with references to Bloomberg page “MF Equity VWAP” meaning the applicable Bloomberg page displaying the volume-weighted average sale price per unit of such securities and references to the Principal Market meaning the principal exchange or other market in which such securities are then listed, quoted or traded. The VWAP during any period should be appropriately adjusted to take into account the occurrence during such period of any event described in Section 10.

In addition to the above definitions, unless the context requires otherwise:

(i) any reference to any statute, regulation, rule or form as of any time shall mean such statute, regulation, rule or form as amended or modified and shall also include any successor statute, regulation, rule or form from time to time;

(ii) references to “$” or “dollars” means the lawful coin or currency the United States of America; and

(iii) references to “Section” are references to Sections of this Certificate of Designations.

Section 4.

Dividends.

(a) Quarterly Dividends.

(i) Holders shall be entitled to receive, if, as and when declared by the Board of Directors or any duly authorized committee thereof, out of assets legally available for the payment of dividends under Bermuda law, cumulative cash dividends on the Original Liquidation Preference at a rate per annum equal to 6%, payable quarterly in arrears (the “Quarterly Dividends”) on each February 15, May 15, August 15 and November 15, commencing on August 15, 2008; provided, however, if any such day is not a Business Day, then payment of any Quarterly Dividend otherwise payable on that date will be made on the next succeeding day that is a Business Day, unless that day falls in the next calendar year, in which case payment of such Quarterly Dividend will occur on the immediately preceding Business Day (each such day on which Quarterly Dividends are payable, after giving effect to this proviso if applicable, a “Quarterly Dividend Payment Date”). The period from and including the date of issuance of the Convertible Preference Shares (the “Issue Date”) or any Quarterly Dividend Payment Date to, but excluding, the next Quarterly Dividend Payment Date is a “Quarterly Dividend Period”. (It is understood that the number of days on which Quarterly Dividends may accrue in any Quarterly Dividend Period may increase or decrease pursuant to the proviso in the second preceding sentence, but no interest or other payment shall be due in respect of any

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payment date deferral pursuant to such proviso.) The Quarterly Dividends shall begin to accumulate on the Issue Date and shall be deemed to accumulate from day to day whether or not earned or declared until paid. The record date for payment of Quarterly Dividends on the Convertible Preference Shares will be the first day of the calendar month during which the Quarterly Dividend Payment Date falls or such other record date, if any, as may be fixed by the Board of Directors or any duly authorized committee thereof that is not more than 30 nor less than 10 days prior to such Quarterly Dividend Payment Date (a “Quarterly Dividend Record Date”). Any such day that is a Quarterly Dividend Record Date will be a Quarterly Dividend Record Date whether or not such day is a Business Day. The amount of Quarterly Dividends payable will be computed on the basis of a 360-day year of twelve 30-day months.

(ii) Quarterly Dividends, may, at the option of the Company, be paid in cash or by issuing fully paid and nonassessable Common Shares or by a combination thereof. If the Company elects to pay Quarterly Dividends in Common Shares, the number of Common Shares to be paid in respect of such Quarterly Dividends will be calculated by dividing the amount of such payment by 95% of the Current Market Price as of the date such payment is made.

(b) Participating Dividends. Holders shall be entitled to participate in any dividends paid on outstanding Common Shares in an amount equal, for each Convertible Preference Share, to the amount of such dividends as would be paid on the largest number of Common Shares into which such Convertible Preference Share could be converted on the date of payment of such dividends on the outstanding Common Shares, assuming such converted Common Shares were outstanding on the applicable record date for such dividend (“Participating Dividends”). Each Participating Dividend will be paid on the day that the corresponding dividend on the outstanding Common Shares is paid. However, no dividend or other distribution on outstanding Common Shares shall give rise to a Participating Dividend if it consists solely of Junior Shares (where the powers, preferences and rights of the dividend shares are substantially the same as those of the shares on which the dividend is being paid) and gives rise to an adjustment of the Conversion Rate pursuant to Section 10. The record date for payment of the Participating Dividends on the Convertible Preference Shares will be the record date for the payment of the corresponding dividend on the outstanding Common Shares as fixed by the Board of Directors or any duly authorized committee thereof. The Company has no obligation whatsoever to declare or pay any dividends on outstanding Common Shares with respect to any or all periods, and no obligation to pay Participating Dividends except to the extent, if any, that it has declared and paid dividends on outstanding Common Shares as provided above.

(c) Cumulative Dividends. Quarterly Dividends on the Convertible Preference Shares shall be cumulative, and from and after any Quarterly Dividend Payment Date on which any dividend or any payment upon redemption or conversion that has accumulated or been deemed to have accumulated through such date has not been paid in full (the “Arrearage”), additional dividends shall accumulate in respect of the Arrearage at the rate per annum of 6%. Such additional dividends in respect of any Arrearage shall be deemed to accumulate quarterly

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on each Quarterly Dividend Payment Date whether or not earned or declared until the Arrearage is paid, shall be calculated as of such Quarterly Dividend Payment Date and shall constitute additional Arrearage from and after such Quarterly Dividend Payment Date to the extent not paid on such Quarterly Dividend Payment Date. References in any Article herein to dividends that have “accumulated” or that have been deemed to have accumulated with respect to the Convertible Preference Shares shall include the amount, if any, of any Arrearage together with any dividends accumulated or deemed to have accumulated on such Arrearage pursuant to the immediately preceding two sentences.

(d) Priority of Dividends. So long as any Convertible Preference Shares remain issued and outstanding, the Company will not, and will cause its Subsidiaries not to, declare, pay or set apart funds for any dividends or other distributions with respect to any Junior Shares or redeem, repurchase or otherwise acquire, or make a liquidation payment relating to, any Junior Shares, or make any guarantee payment with respect thereto, in any case during or in respect of any Quarterly Dividend Period, unless full dividends (including any Arrearage and dividends accumulated in respect thereof) have been or contemporaneously are declared and paid (or declared and a sum sufficient for the payment of those dividends has been set apart for such payment) on the Convertible Preference Shares for all Quarterly Dividend Periods terminating on or prior to the date of such declaration, payment, repurchase, redemption or acquisition; provided, however, that the foregoing restriction will not apply to:

(i) purchases, redemptions or other acquisitions of Junior Shares (and the payment of cash in lieu of fractional shares in connection therewith) in connection with any employment contract, benefit plan or other similar arrangement with or for the benefit of employees, officers, directors or consultants of the Company or any Subsidiary;

(ii) purchases of Common Shares pursuant to a contractually binding requirement (which the Company is not entitled to lawfully terminate) to buy shares existing prior to the commencement of the then-current Quarterly Dividend Period, including under a contractually binding share repurchase plan;

(iii) as a result of an exchange or conversion of any class or series of Junior Shares for any other class or series of Junior Shares;

(iv) the purchase of fractional interests in Junior Shares pursuant to the conversion or exchange provisions of such Junior Shares or the security being converted or exchanged; or

(v) the purchase of Junior Shares by a broker or dealer subsidiary of the Company in connection with market-making or other secondary market activities in the ordinary course of the business of such subsidiary.

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The foregoing restriction, however, will not apply to any dividends paid in the form of Junior Shares where the powers, preferences and rights of the dividend shares are substantially the same as those of the shares on which the dividend is being paid.

For so long as any Convertible Preference Shares remain issued and outstanding, if full dividends (including any Arrearage and dividends accumulated in respect thereof) are not paid in full (or declared and a sum sufficient for such full payment is not so set apart) for any Quarterly Dividend Period on the Convertible Preference Shares and any Parity Dividend Shares, dividends declared on the Convertible Preference Shares and such Parity Dividend Shares shall only be declared pro rata based upon the respective amounts that would have been paid on the Convertible Preference Shares and such Parity Dividend Shares had dividends (including any Arrearage and dividends accumulated in respect thereof) been declared and paid in full.

Subject to the foregoing, such dividends payable in cash, shares or otherwise as may be determined by the Board of Directors, or any duly authorized committee thereof, may be declared and paid on any Junior Shares and Parity Shares from time to time out of any assets legally available for such payment, and (except for Participating Dividends as provided in Section 4(b)) Holders will not be entitled to participate in those dividends.

Section 5.

Liquidation Rights.

(a) Liquidation. In the event of any voluntary or involuntary liquidation, dissolution or winding up of the affairs of the Company, Holders shall be entitled, out of assets legally available therefor, before any distribution or payment out of the assets of the Company may be made to or set aside for the holders of any Junior Liquidation Shares and subject to the rights of the holders of any class or series of securities ranking senior to or on parity with Convertible Preference Shares upon liquidation and the rights of the Company’s creditors, to receive in full in respect of each Convertible Preference Share a liquidating distribution in the amount of the greater of (x) the Original Liquidation Preference plus all accumulated and unpaid dividends in respect of such share, whether or not declared (including Arrearage and dividends accumulated in respect thereof) to, but excluding, the date fixed for liquidation, dissolution or winding up (the “Liquidation Preference”) and (y) the amount the Holders would have received if such Holders converted all of their Convertible Preference Shares pursuant to Section 7 hereof on the date fixed for liquidation, dissolution or winding up. Holders shall not be entitled to any further payments in the event of any such voluntary or involuntary liquidation, dissolution or winding up of the affairs of the Company other than what is expressly provided for in this Section 5. For the avoidance of doubt, the Liquidation Preference does not include any Participating Dividends.

(b) Partial Payment. If, upon any voluntary or involuntary liquidation, dissolution or winding up of the affairs of the Company, the assets of the Company are not sufficient to pay the liquidating distributions payable with respect to the Convertible Preference Shares and the Parity Liquidation Shares, the amounts paid to the Holders and to the holders of all Parity Liquidation Shares shall be paid pro rata in accordance with the respective aggregate liquidating distributions to which they would otherwise be entitled.

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(c) Residual Distributions. If the respective aggregate liquidating distributions to which all Holders and all holders of any Parity Liquidation Shares are entitled have been paid, the holders of Junior Liquidation Shares shall be entitled to receive all remaining assets of the Company according to their respective rights and preferences.

(d) Consolidation, Merger, Amalgamation, Scheme of Arrangement and Sale of Assets Not Liquidation. For purposes of this Section 5, the sale, lease or other disposition (for cash, shares, securities or other consideration) of all or substantially all of the assets of the Company shall not be deemed a voluntary or involuntary dissolution, liquidation or winding up of the affairs of the Company, nor shall the consolidation, merger, amalgamation, scheme of arrangement, other binding share exchange or reclassification or any similar transaction involving the Company (whether or not the Company is the surviving or resulting entity) be deemed to be a voluntary or involuntary dissolution, liquidation or winding up of the affairs of the Company.

Section 6.

Redemption.

(a) Optional Redemption. The Company, at the option of its Board of Directors or any duly authorized committee thereof, may redeem out of funds legally available therefor, in whole or in part, the Convertible Preference Shares at the time issued and outstanding, on any one or more Quarterly Dividend Payment Dates on or after May 15, 2013, upon notice given as provided in Section 6(b) below, and at a redemption price equal to the Liquidation Preference (calculated as if the date of redemption was the date fixed for liquidation, dissolution or winding up); provided that the Company shall only be entitled to redeem the Convertible Preference Shares of any Holder if such redemption is treated (in the Company’s reasonable determination after due inquiry) with respect to such Holder as a distribution in exchange for such Holder’s Convertible Preference Share within the meaning of Section 302(a) of the Internal Revenue Code of 1986, as amended.

Notwithstanding the foregoing, the Company, at the option of its Board of Directors or any duly authorized committee thereof, may redeem out of funds legally available therefor, at any time, in whole but not in part, the Convertible Preference Shares at the time issued and outstanding if the aggregate Liquidation Preference of such shares is equal to 10% or less of the aggregate Liquidation Preference of all Convertible Preference Shares originally issued by the Company, upon notice as provided in Section 6(b) below, and at a redemption price equal to the Liquidation Preference (calculated as if the date of redemption was the date fixed for liquidation, dissolution or winding up).

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(b) Notice of Redemption. Notice of every redemption of the Convertible Preference Shares shall be mailed by first class mail, postage prepaid, addressed to the Holders of such shares to be redeemed at their respective last addresses appearing on the register of Members of the Company. Such mailing shall be at least 30 days and not more than 60 days before the date fixed for redemption. Any notice mailed as provided in this Section 6(b) shall be conclusively presumed to have been duly given, whether or not any Holder receives such notice, but failure duly to give such notice by mail, or any defect in such notice or in the mailing thereof, to any Holder of the Convertible Preference Shares designated for redemption shall not affect the validity of the proceedings for the redemption of any other Convertible Preference Shares. Each notice shall state:

(i) the redemption date;

(ii) the number of Convertible Preference Shares to be redeemed and, if fewer than all the shares of a Holder are to be redeemed, the number of such shares to be redeemed;

(iii) the redemption price;

(iv) the place or places where the certificates for such shares are to be surrendered for payment of the redemption price; and

(v) that dividends on the shares to be redeemed will cease to accumulate on the redemption date.

Notwithstanding the foregoing, if the Convertible Preference Shares are held in book-entry form through a Depositary, the Company may give such notice in any manner permitted by the Depositary.

(c) Partial Redemption. In case of any redemption of only part of the Convertible Preference Shares at the time issued and outstanding, the Convertible Preference Shares to be redeemed shall be selected pro rata from the Holders in proportion to the number of Convertible Preference Shares held by such Holders, by lot or in such other manner as the Board of Directors or any duly authorized committee thereof may determine to be fair and equitable. Subject to the provisions of this Section 6, the Board of Directors or any duly authorized committee thereof shall have full power and authority to prescribe the terms and conditions upon which the Convertible Preference Shares shall be redeemed from time to time.

(d) Effectiveness of Redemption. If notice of redemption has been duly given and if on or before the redemption date specified in the notice all funds necessary for the redemption have been set aside by the Company, separate and apart from its other assets, in trust for the pro rata benefit of the Holders of the shares called for redemption, so as to be and continue to be available therefor, or deposited by the Company with a bank or trust company selected by the Board of Directors or any duly authorized committee thereof in trust for the pro rata benefit of the Holders of the shares called for redemption (the “Trust”), then, notwithstanding that any certificate for any share so called for redemption has not been surrendered for cancellation, on and after the redemption date all shares so called for redemption shall cease to be issued and

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outstanding, all dividends with respect to such shares shall cease to accumulate on such redemption date and all rights with respect to such shares shall forthwith on such redemption date cease and terminate, except only the right of the Holders thereof to receive the amount payable on such redemption from the Trust at any time after the redemption date from the funds so deposited, without interest. The Company shall be entitled to receive, from time to time, from the Trust any interest accrued on such funds, and the Holders of any shares called for redemption shall have no claim to any such interest. Any funds so deposited and unclaimed at the end of three years from the redemption date shall, to the extent permitted by law, be released or repaid to the Company, and in the event of such repayment to the Company, the Holders of the shares so called for redemption shall be deemed to be unsecured creditors of the Company for an amount equivalent to the amount deposited as stated above for the redemption of such shares and so repaid to the Company, but shall in no event be entitled to any interest.

(e) Conversion Prior to Redemption. If the Convertible Preference Shares have been called for redemption, a Holder will be entitled to convert the Convertible Preference Shares from the date of notice of the redemption until the close of business on the second Business Day immediately preceding the date of redemption.

(f) Reduction of Share Capital. Any redemption of Convertible Preference Shares under this Section 6 shall not be taken as reducing the amount of the Company’s authorized share capital.

Section 7.

Right of the Holders to Convert.

Each Holder shall have the right, at such Holder’s option (including after a notice of redemption has been given but prior to the date of actual redemption), to convert all or any portion of such Holder’s Convertible Preference Shares at any time into (a) Common Shares at the then-applicable Conversion Rate per share of Convertible Preference Shares (subject to the conversion procedures of Section 8), plus cash in lieu of fractional shares plus (b) cash, fully paid and nonassessable Common Shares or a combination thereof (which determination shall be made at the option of the Company) in respect of any and all accumulated and unpaid dividends on the Convertible Preference Shares so converted, whether or not declared (including Arrearage and dividends accumulated in respect thereof) to, but excluding, the applicable Conversion Date, provided that if the Company elects to pay any or all such dividends in Common Shares the number of Common Shares to be distributed in respect thereof will be calculated by dividing the amount of such dividend payment by 95% of the Current Market Price as of the Conversion Date.

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Section 8.

Conversion Procedures.

(a) Conversion Date. Effective immediately prior to the close of business on any applicable Conversion Date, dividends shall no longer be declared on any such converted Convertible Preference Shares and such Convertible Preference Shares shall cease to be issued and outstanding, in each case, subject to the right of Holders to receive any payments to which they are entitled pursuant to the terms hereof.

(b) Rights Prior to Conversion. No allowance or adjustment, except pursuant to Section 10, shall be made in respect of dividends payable to holders of the Common Shares of record as of any date prior to the close of business on any applicable Conversion Date. Prior to the close of business on any applicable Conversion Date, Common Shares issuable upon conversion of, or other securities issuable upon conversion of, any Convertible Preference Shares shall not be deemed issued and outstanding for any purpose, and Holders shall have no rights with respect to the Common Shares or other securities issuable upon conversion (including voting rights, rights to respond to tender offers for the Common Shares or other securities issuable upon conversion and rights to receive any dividends or other distributions on the Common Shares or other securities issuable upon conversion) by virtue of holding Convertible Preference Shares; provided that nothing in this Section 8(b) shall be deemed to restrict or limit the rights of Holders under the terms of the Convertible Preference Shares themselves, including the voting rights set forth in Section 12 and the rights to dividends and liquidating distributions set forth in Section 4 and Section 5, respectively.

(c) Reacquired Shares. Convertible Preference Shares duly converted in accordance with this Certificate of Designations, or otherwise reacquired by the Company, will resume the status of authorized and unissued preference shares without designation as to series, until such shares are once more designated as part of a particular series by the Board of Directors.

(d) Record Holder as of Conversion Date. The Person or Persons entitled to receive the Common Shares and/or cash, securities or other property issuable upon conversion of the Convertible Preference Shares shall be treated for all purposes as the record holder(s) of such Common Shares and/or securities as of the close of business on any applicable Conversion Date. In the event that a Holder shall not by written notice designate the name in which Common Shares and/or cash, securities or other property (including payments of cash in lieu of fractional shares) to be issued or paid upon conversion of Convertible Preference Shares should be registered or paid or the manner in which such shares should be delivered, the Company shall be entitled to register and deliver such shares, and make such payment, in the name of the Holder and in the manner shown on the records of the Company or, in the case of global certificates, through book-entry transfer through the Depositary.

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(e) Conversion Procedure. On the date of any conversion, if a Holder’s interest is in certificated form, a Holder must do each of the following in order to convert:

(i) complete and manually sign the conversion notice provided by the Conversion Agent, or a facsimile of the conversion notice, and deliver this notice to the Conversion Agent, provided that such notice may, pursuant to a written notice thereunder be made contingent upon (but only upon) the successful completion of any registered public offering of the Common Shares to be issued on such conversion that is being conducted pursuant to the Registration Agreement at such time and such notice shall in all other respects be irrevocable;

(ii) surrender the Convertible Preference Shares to the Conversion Agent;

(iii) if required, furnish appropriate endorsements and transfer documents; and

(iv) if required, pay any share transfer, documentary, stamp or similar taxes not payable by the Company pursuant to Section 23.

If a Holder’s interest is a beneficial interest in a global certificate representing Convertible Preference Shares, in order to convert a Holder must comply with clauses (iii) and (iv) listed above and comply with the Depositary’s procedures for converting a beneficial interest in a global security. The date on which a Holder complies with the applicable procedures in this Section 8(e) is the “Conversion Date”; provided that, if such date is not a Business Day or such compliance does not occur prior to the close of business on such date, the Conversion Date shall be the next Business Day. The Conversion Agent shall, on a Holder’s behalf, convert the Convertible Preference Shares into Common Shares, in accordance with the terms of the notice delivered by such Holder described in clause (i) above (or otherwise pursuant to any applicable Depositary procedures).

Section 9.

Conversion at the Option of the Company.

(a) Company Conversion Right. At any time or from time to time on or after May 15, 2013 if, for any 20 Trading Days (whether or not consecutive) within a period of thirty (30) consecutive Trading Days ending on the Trading Day preceding the date the Company delivers a Notice of Conversion at the Option of the Company, the Closing Price of the Common Shares exceeds 125% of the then-applicable Conversion Price of the Convertible Preference Shares, the Company shall have the right, at its option, to cause some or all of the Convertible Preference Shares to be converted into (a) Common Shares at the then-applicable Conversion Rate, plus cash in lieu of fractional shares, plus (b) cash, fully paid and nonassessable Common Shares or a combination thereof (which determination shall be made at the option of the Company) in respect of any and all accumulated and unpaid dividends on the Convertible Preference Shares so converted, whether or not declared (including Arrearage and dividends accumulated in respect thereof) to, but excluding, the Conversion at the Option of the Company Date; provided that if the Company elects to pay any or all such dividends in Common Shares the number of Common Shares to be distributed in respect thereof will be calculated by dividing the amount of such dividend payment by 95% of the Current Market Price as of the Conversion

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at the Option of the Company Date. On the date the Company delivers a Notice of Conversion at the Option of the Company all Common Shares issued upon such conversion are Freely Tradeable and may be immediately resold by the Holder at such time and for a period of no less than 30 days thereafter without restriction under any trading policies that might otherwise be applicable to such Holder by virtue of its having designees on the Board of Directors or otherwise.

(b) Partial Conversion. If the Company elects to cause less than all the Convertible Preference Shares to be converted under Section 9(a), the Conversion Agent shall select the Convertible Preference Shares to be converted on a pro rata basis. If the Conversion Agent selects a portion of a Holder’s Convertible Preference Shares for partial conversion at the option of the Company and such Holder converts a portion of its Convertible Preference Shares, the converted portion will be deemed to be the portion selected for conversion at the option of the Company under this Section 9.

(c) Conversion Procedure. In order to exercise the conversion right described in this Section 9, the Company shall provide notice of such conversion to each Holder (such notice, a “Notice of Conversion at the Option of the Company”). The Conversion Date shall be a date selected by the Company (the “Conversion at the Option of the Company Date”) and shall be no more than 20 days after the date on which the Company provides such Notice of Conversion at the Option of the Company. In addition to any information required by applicable law or regulation, the Notice of Conversion at the Option of the Company shall state, as appropriate:

(i) the Conversion at the Option of the Company Date;

(ii) the number of Common Shares to be issued upon conversion of each of the Convertible Preference Shares and, if fewer than all the shares of a Holder are to be converted, the number of the Holder’s shares to be converted;

(iii) in reasonable detail, the calculations and supporting data used by the Company in its determination that it had the right to effect such conversion; and

(iv) the total number of Convertible Preference Shares to be converted.

Notwithstanding the foregoing, (x) if the Convertible Preference Shares are held in book-entry form through a Depositary, the Company may give such notice in any manner permitted by the Depositary and (y) the Holder shall have the right to exercise its right to convert pursuant to Section 7 hereof at any time prior to the Conversion at the Option of the Company Date, and the exercise by the Holder of such right shall supersede and prevail over the exercise by the Company of its rights under this Section 9.

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Section 10.

Anti-Dilution Adjustments.

(a) Adjustments. The Conversion Rate will be subject to adjustment, without duplication, under the following circumstances:

(i) the issuance of Common Shares as a dividend, bonus shares or distribution to all holders of Common Shares, or a subdivision or combination of Common Shares, in which event the Conversion Rate will be adjusted based on the following formula:


CR¹ = CR₀ x (OS¹ / OS₀)



where,

CR₀	=	the Conversion Rate in effect at the close of business on the Record Date

CR¹	=	the Conversion Rate in effect immediately after the Record Date

OS₀	=	the number of Common Shares issued and outstanding at the close of business on the Record Date prior to giving effect to such event

OS¹	=	the number of Common Shares that would be issued and outstanding immediately after, and solely as a result of, such event

(ii) the issuance to all holders of Common Shares of rights or warrants (including convertible securities) entitling them for a period expiring 60 days or less from the date of issuance of such rights or warrants to purchase Common Shares at an exercise price per share less than (or having a conversion price per share less than) the lower of (1) the Conversion Price and (2) the Current Market Price as of the Record Date, in which event the Conversion Rate will be adjusted based on the following formula:


CR¹ = CR₀ x (OS₀ + X) / (OS₀ + Y)



where,

CR₀	=	the Conversion Rate in effect at the close of business on the Record Date

CR¹	=	the Conversion Rate in effect immediately after the Record Date

OS₀	=	the number of Common Shares issued and outstanding at the close of business on the Record Date

X	=	the total number of Common Shares issuable pursuant to such rights (or upon conversion of such securities)

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Y		=		the aggregate price payable to exercise such rights (or the aggregate conversion price for such securities paid upon conversion) divided by the average of the VWAP of the Common Shares over each of the ten consecutive Trading Days prior to the Business Day immediately preceding the announcement of the issuance of such rights

However, the Conversion Rate will be readjusted to the extent that any such rights or warrants are not exercised prior to their expiration; provided that such readjustment shall not have any effect on Convertible Preference Shares that had been converted prior to such readjustment or on the Common Shares issued pursuant thereto, and such readjustment shall apply only to such Convertible Preference Shares that remain outstanding at the time of such readjustment.

(iii) the dividend or other distribution to all holders of Common Shares of shares of the Company (other than Common Shares), rights or warrants (including convertible securities) to acquire shares of the Company or evidences of its indebtedness or its assets (excluding any dividend, distribution or issuance covered by clause (i) or (ii) above or (iv) below or that gives rise to a Participating Dividend) in which event the Conversion Rate will be adjusted based on the following formula:


		CR¹ = CR₀ x SP₀ / (SP₀ – FMV)



where,

CR₀	=	the Conversion Rate in effect at the close of business on the Record Date

CR¹	=	the Conversion Rate in effect immediately after the Record Date

SP₀	=	the Current Market Price as of the Record Date

FMV	=	the fair market value (as reasonably determined by the Board of Directors) on the Record Date of the shares of the Company, rights or warrants, or evidences of indebtedness or assets so distributed, expressed as an amount per Common Share

However, if the transaction that gives rise to an adjustment pursuant to this clause (iii) is one pursuant to which the payment of a dividend, bonus shares or other distribution on the Common Shares consists of shares of, or similar equity interests in, a Subsidiary or other business unit of the Company (e.g., a spin-off), or consists of any other securities, that are, or, when issued, will be, traded on a securities exchange or quoted on a quotations facility in the U.S. or elsewhere, then the Conversion Rate will instead be adjusted based on the following formula:

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CR¹	=	CR₀ x (FMV₀ + MP₀) / MP₀

where,

CR₀	=	the Conversion Rate in effect at the close of business on the Record Date

CR¹	=	the Conversion Rate in effect immediately after the Record Date

FMV₀	=	the average of the VWAP of the shares, similar equity interests or other securities distributed to holders of Common Shares applicable to one Common Share over each of the 10 consecutive Trading Days commencing on and including the third Trading Day after the date on which “ex-distribution trading” commences for such shares, similar equity interests or other securities on the principal exchange or other market on which they are then listed, quoted or traded

MP₀	=	the average of the VWAP of the Common Shares over each of the 10 consecutive Trading Days commencing on and including the third Trading Day after the date on which “ex-distribution trading” commences for such dividend or distribution on the principal exchange or other market on which Common Shares are then listed or quoted

(iv) the Company or one or more of its Subsidiaries make purchases of Common Shares pursuant to a tender or exchange offer by the Company or a Subsidiary of the Company for Common Shares to the extent (as reasonably determined by the Board of Directors) that the cash and value of any other consideration included in the payment per Common Share validly tendered or exchanged exceeds the VWAP per Common Share on the Trading Day next succeeding the last date on which tenders or exchanges may be made pursuant to such tender or exchange offer (the “Expiration Date”), in which event the Conversion Rate will be adjusted based on the following formula:


.CR¹ = CR₀ x [(FMV + (SP¹ x OS¹)] / (SP¹ x OS₀)

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FMV	=	the fair market value (as reasonably determined by the Board of Directors), on the Expiration Date, of the aggregate value of all cash and any other consideration paid or payable for Common Shares validly tendered or exchanged and not withdrawn as of the Expiration Date (the “Purchased Shares”)

OS¹	=	the number of Common Shares issued and outstanding as of the last time tenders or exchanges may be made pursuant to such tender or exchange offer (the “Expiration Time”) (treating all Purchased Shares as outstanding at the Expiration Time), less any Purchased Shares

OS₀	=	the number of Common Shares issued and outstanding at the Expiration Time, including any Purchased Shares

SP¹	=	the average of the VWAP of the Common Shares over each of the ten consecutive Trading Days commencing on the Trading Day immediately after the Expiration Date.

(b) Calculation of Adjustments. Each adjustment to the Conversion Rate shall be calculated by the Company as soon as reasonably practicable after the event requiring such adjustment has been consummated (and all factors necessary to calculate such adjustment are known), in each case to the nearest 1/10,000^th of one Common Share (or if there is not a nearest 1/10,000^th of a share, to the next lower 1/10,000^th of a share). Notwithstanding anything herein to the contrary, except in the case of a combination or reverse stock split of Common Shares pursuant to Section 10(a)(i), in no case will any adjustment be made if it would result in a decrease to the then effective Conversion Rate. No adjustment to the Conversion Rate will be required unless such adjustment would require an increase or decrease of at least one percent; provided, however, that any such minor adjustments that are not required to be made, and are not made, will be carried forward and taken into account in any subsequent adjustment; and provided further that any such adjustment of less than one percent that has not been made will be made upon (x) the date of any notice of redemption of the Convertible Preference Shares in accordance with the provisions hereof and (y) any Conversion Date.

(i) Except as otherwise provided in this Section 10, the Conversion Rate will not be adjusted for the issuance of Common Shares or any securities convertible into or exchangeable for Common Shares or carrying the right to purchase any of the foregoing or for the repurchase of Common Shares.

(ii) No adjustment of the Conversion Rate need be made as a result of: (A) the issuance of the rights; (B) the distribution of separate certificates representing the rights; (C) the exercise or redemption of the rights in accordance with any rights agreement; or (D) the termination or invalidation of the rights, in each case, pursuant to the Company’s shareholder rights plan existing on the date of hereof, as amended, modified or supplemented from time to time, or any newly adopted shareholder rights plans; provided, however, that to the extent that the Company has a shareholder rights plan in effect on a Conversion Date (including the Company’s rights plan existing on the

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date hereof), the Holder shall receive, in addition to the Common Shares, the rights under such rights plan, unless (for the existing plan or a future plan with substantially similar provisions), prior to any such Conversion Date, the rights have separated from the Common Shares, in which case the Conversion Rate will be adjusted at the time of separation as if the Company made a distribution to all holders of Common Shares or evidences of its indebtedness or its assets as described in Section 10(a)(iii), subject to readjustment in the event of the expiration, termination or redemption of the rights.

(iii) No adjustment to the Conversion Rate need be made:

(A) upon the issuance of any Common Shares pursuant to any present or future customary plan providing for the reinvestment of dividends or interest payable on securities of the Company and the investment, at market prices, of additional optional amounts in Common Shares; or

(B) upon the issuance of any Common Shares or options or rights to purchase those shares pursuant to any present or future employee, director or consultant benefit plan or program of or assumed by the Company or any of its Subsidiaries or other Affiliates.

(iv) No adjustment to the Conversion Rate will be made to the extent that such adjustment would result in the Conversion Price being less than the par value of the Common Shares.

(v) Notwithstanding any other provision herein to the contrary, no adjustment shall be made in respect of an event otherwise requiring an adjustment under this Section 10 except to the extent such event is actually consummated.

(vi) No adjustment shall be made in respect of any dividend or other distribution giving rise to a Participating Dividend.

(d) Record Date. For purposes of this Section 10, “Record Date” means, with respect to any dividend, distribution or other transaction or event in which the holders of the Common Shares have the right to receive any cash, securities or other property or in which the Common Shares (or other applicable security) are exchanged for or converted into any combination of cash, securities or other property, the date fixed for determination of holders of the Common Shares entitled to receive such cash, securities or other property (whether such date is fixed by the Board of Directors or by statute, contract or otherwise).

(e) Successive Adjustments. After an adjustment to the Conversion Rate under this Section 10, any subsequent event requiring an adjustment under this Section 10 shall cause an adjustment to such Conversion Rate as so adjusted.

(f) Multiple Adjustments. For the avoidance of doubt, if an event occurs that would trigger an adjustment to the Conversion Rate pursuant to this Section 10 under more than one subsection hereof, such event, to the extent taken into account in any adjustment, shall not result in any other adjustment hereunder.

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(g) Other Adjustments. The Company may, but shall not be required to, make such increases in the Conversion Rate, in addition to those required by this Section 10, as the Board of Directors considers to be advisable in order to avoid or diminish any income tax to any holders of Common Shares resulting from any dividend or distribution of shares or issuance of rights or warrants to purchase or subscribe for shares or from any event treated as such for income tax purposes or for any other reason.

(h) Notice of Adjustments. Whenever a Conversion Rate is adjusted as provided under this Section 10, the Company shall within 10 Business Days following the occurrence of an event that requires such adjustment (or if the Company is not aware of such occurrence, within 10 Business Days after becoming so aware) or, if the Company makes an adjustment pursuant to Section 10(g), within 10 Business Days after such adjustment:

(i) compute the adjusted applicable Conversion Rate in accordance with this Section 10 and prepare and transmit to the Conversion Agent an Officers’ Certificate setting forth such adjusted applicable Conversion Rate, the method of calculation thereof in reasonable detail and the facts requiring such adjustment and upon which such adjustment is based; and

(ii) provide a written notice to the Holders of the occurrence of such event and a statement in reasonable detail setting forth the method by which the adjustment to the applicable Conversion Rate was determined and setting forth the adjusted applicable Conversion Rate.

(i) Conversion Agent. The Conversion Agent shall not at any time be under any duty or responsibility to any Holder to determine whether any facts exist that may require any adjustment of the applicable Conversion Rate or with respect to the nature, extent or calculation of any such adjustment when made, or with respect to the method employed in making the same. The Conversion Agent shall be fully authorized and protected in relying on any Officers’ Certificate delivered pursuant to Section 10(h) and any adjustment contained therein and the Conversion Agent shall not be deemed to have knowledge of any adjustment unless and until it has received such certificate. The Conversion Agent shall not be accountable with respect to the validity or value (or the kind or amount) of any Common Shares, or of any other securities or property, that may at the time be issued or delivered with respect to any Convertible Preference Shares; and the Conversion Agent makes no representation with respect thereto. The Conversion Agent shall not be responsible for any failure of the Company to issue, transfer or deliver any Common Shares pursuant to a the conversion of Convertible Preference Shares or to comply with any of the duties, responsibilities or covenants of the Company contained in this Section 10.

(j) Fractional Shares. No fractions of Common Shares will be issued to holders of the Convertible Preference Shares upon conversion. In lieu of fractional shares otherwise issuable, holders will be entitled to receive an amount in cash equal to the fraction of a Common Share, calculated on an aggregate basis in respect of the Convertible Preference Shares being converted, multiplied by the Closing Price of the Common Shares on the Trading Day immediately preceding the applicable Conversion Date.

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Section 11.

Adjustment for Reorganization Events.

(a) Reorganization Events. In the event of:

(i) any consolidation, merger, amalgamation, scheme of arrangement, other binding share exchange or reclassification involving the Company in which all or substantially all outstanding Common Shares are converted into or exchanged for cash, securities or other property of the Company or another Person; or

(ii) the completion of any sale or other disposition in one transaction or a series of transactions of all or substantially all the assets of the Company to another Person;

each of which is referred to as a “Reorganization Event,” each Convertible Preference Share issued and outstanding immediately prior to such Reorganization Event will, without the consent of the holders of the Convertible Preference Shares, become convertible into the kind and amount of securities, cash and other property, if any (the “Exchange Property”), receivable in such Reorganization Event (without any interest thereon, and, subject to any right of the Holder to receive Participating Dividends, without any right to dividends or distributions thereon that have a record date that is prior to the applicable Conversion Date) per Common Share by a holder of Common Shares that is not a Person with which the Company effected such consolidation, merger, amalgamation, scheme of arrangement, other binding share exchange or reclassification, or to which such sale or other disposition was made, as the case may be (each of the Company and any such other Person, a “Constituent Person”), or an Affiliate of a Constituent Person to the extent such Reorganization Event provides for different treatment of Common Shares held by Affiliates and Non-Affiliates of the Company; provided that if the kind or amount of securities, cash and other property receivable upon such Reorganization Event is not the same for each Common Share held immediately prior to such Reorganization Event by a Person other than a Constituent Person or an Affiliate thereof (due to elections or otherwise), then for the purpose of this Section 11(a), the kind and amount of securities, cash and other property receivable upon such Reorganization Event will be deemed to be the weighted average of the types and amounts of consideration received by the holders of Common Shares (other than Constituent Persons and Affiliates thereof) that affirmatively make an election (or of all such holders if none make an election) (and if holders of Common Shares (other than Constituent Persons and their Affiliates) may elect the kind and amount of securities, cash and other property so receivable, each Holder shall have the same election right with respect to the Exchange Property receivable upon conversion after the Reorganization

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Event, provided such Holder notifies the Company of its election in writing prior to the Reorganization Event). On each Conversion Date following a Reorganization Event, the Conversion Rate then in effect will be applied to the Exchange Property received per Common Share, as determined in accordance with this Section 11.

(b) Successive Reorganization Events. The above provisions of this Section 11 shall similarly apply to successive Reorganization Events and the provisions of Section 10 shall apply to any securities of the Company (or any successor) received by the holders of the Common Shares in any such Reorganization Event.

(c) Reorganization Event Notice. The Company (or any successor) shall, within 20 days after the occurrence of any Reorganization Event, provide written notice to the Holders of such occurrence of such event and of the kinds and amounts of the cash, securities or other property that constitutes the Exchange Property. Failure to deliver such notice shall not affect the operation of this Section 11.

Section 12.

Voting Rights.

(a) General. The Holders shall not be entitled to vote on, consent to or take any other action with respect to any matter, whether pursuant to this Certificate of Designations, the Bye-laws or otherwise, except as set forth in Section 12(b), 12(c) or 12(d) below or as required by Bermuda law.

(b) Special Voting Right.

(i) Voting Right. If and whenever dividends on the Convertible Preference Shares, or on any other class or series of Parity Dividend Shares, have not been paid in an aggregate amount equal, as to any particular class or series, to at least six quarterly dividend periods, whether consecutive or not (a “Nonpayment”), (A) the Board of Directors shall resolve to increase the number of directors constituting the Board of Directors by two and nominate two individuals as directors to fill such new vacancies and (B) the Holders, together with the holders of any and all classes and series of Parity Dividend Shares having “like voting rights” (i.e., being similarly entitled to vote for two additional directors at such time) (the Holders and any such other holders, collectively, the “Voting Holders”), shall have the right, voting separately as a single class without regard to class or series (and with voting rights allocated pro rata based on the liquidation preference of each such class or series), to the exclusion of the holders of Common Shares, to elect to the Board of Directors two additional directors from among such nominees, in the manner provided in this Section 12(b). Each such director elected by the Voting Holders pursuant to this Section 12(b) is herein called a “Preference Share Director.” At no time shall the Board of Directors include more than two Preference Share Directors.

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(ii) Nomination. At any time when the Voting Holders are entitled to elect a Preference Share Director pursuant to this Section 12(b), any one or more of the Holders holding at least a majority in aggregate Liquidation Preference of the Convertible Preference Shares then issued and outstanding and entitled to nominate under the terms of such shares, and/or any one or more holders of any other class or series of Parity Dividend Shares having like voting rights then issued and outstanding, shall have the right to recommend individuals to the Company to serve as Preference Share Directors. Such recommendations shall be in writing and shall be accompanied by a Director Acceptance Letter in the form attached hereto as Exhibit B (“Director Acceptance Letter”), from and signed by each such recommended individual and such background and other information about each such individual as the Company may reasonably request to ensure compliance with applicable disclosure and other considerations pursuant to applicable law and customary practice. The Board of Directors (excluding Preference Share Directors) will nominate the individuals so recommended for each Preference Share Director to be elected. The Board of Directors shall submit each recommended individual who it nominates pursuant to this Section 12(b)(ii) to the Voting Holders for election as a Preference Share Director as provided below.

(iii) Election; Vacancy. The election of the Preference Share Directors by the Voting Holders may take place at any general meeting of Members, or at any special meeting of Voting Holders held separately from other Members, or by means of a written resolution of the Voting Holders in lieu of a meeting thereof, in each case as the Board of Directors may determine in its reasonable discretion. The Preference Share Directors shall be so elected by a plurality of the votes cast at the relevant meeting (or, if the election is effected by written resolution, by the Voting Holders constituting a quorum, which shall also be the required voting threshold for purposes of such a written resolution), in each case whether or not the number of nominees exceeds the number of individuals to be elected. Each of the Preference Share Directors elected hereunder shall serve as a director until the next annual general meeting of Members, or until the earlier of such time as he or she resigns, retires, dies or is removed or the special voting right pursuant to this Section 12(b) terminates. The Board of Directors shall nominate individuals to succeed such individuals as the Preference Share Directors, in each case from among recommendations of the Voting Holders, all as provided in Section 12(b)(ii) provided that such recommendations may include any such individuals whose service has ended and, in lieu of selecting nominees from any such recommendations, the Board of Directors may, in its discretion, nominate any or both of such individuals whose service has ended (if willing to serve) for another term as a Preference Share Director. Each Preference Share Director shall agree, in the Director Acceptance Letter, to resign as such director when his or her term otherwise ends pursuant to any removal or termination of the special voting right as provided in this Section 12(b). In case any vacancy in the office of a Preference Share Director occurs due to resignation, retirement, death or removal, the vacancy may be filled by the written consent of the Preference Share Director remaining in office, or if none remains in office, in an election by Voting Holders as provided above for an initial election. All determinations and other actions to

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be made or taken by the Board of Directors with regard to Preference Share Directors pursuant to this Section 12(b) shall be taken by the Board of Directors excluding the Preference Share Directors, who shall not be considered as “Directors” for the purpose of such actions (including for the purpose of applying any quorum and voting requirements applicable to such actions). The Company will use reasonable best efforts to cause the individuals nominated to be elected as soon as practicable, which will include for the avoidance of doubt, the initial election of any Preference Share Director, and the election of Preference Share Directors at any subsequent annual general meeting following the initial election of any Preference Share Director. Subject to the foregoing, each of the Preference Share Directors shall have one vote as a director.

(iv) Notice of Special Meeting; Quorum. The Company shall as soon as practicable, and in no case more than 30 days after the Board of Directors has selected the nominees as provided above, submit such nominees to the Voting Holders for election either (i) at a general meeting of Members, (ii) at a special meeting of Voting Holders or (iii) by written resolution, as determined by the Board of Directors in its reasonable discretion. Notice for a special meeting of Voting Holders may be given in the same manner as that provided in the Bye-laws for a special general meeting of the Members. If the Company fails to give notice of a meeting of Members or Voting Holders, or to seek a written resolution of Voting Holders, to elect the Preference Share Directors within 30 days after the Board of Directors has selected the nominees for such election as provided above, any Voting Holders entitled to recommend individuals for election as a Preference Share Director shall be entitled (at the Company’s expense) to call such a meeting or seek such a written resolution to elect such nominees selected by the Board of Directors, and for that purpose will have access to the register of Members of the Company. At any general meeting of Members, or any special meeting of Voting Holders, at which the Voting Holders have the right to elect the Preference Share Directors, or at any adjournment thereof, the presence of at least two Persons holding or representing by proxy at least 50% in aggregate liquidation preference of the Convertible Preference Shares and all other classes and series of Parity Dividend Shares having like voting rights, in each case at the time issued and outstanding, will be required to constitute a quorum for the election of any Preference Share Director. (Such quorum requirement shall also apply with respect to any election of Preference Share Directors to be effected with the consent of Voting Holders given in a written resolution.) At any general meeting of Members or adjournment thereof, the absence of such a quorum of Voting Holders will not prevent the election of directors other than the Preference Share Directors, and the absence of a quorum for the election of such other directors will not prevent the election of the Preference Share Directors. The Company may fix a date as the record date for the purpose of determining the issued and outstanding preference shares of any class or series, and the Holders and other holders thereof entitled to elect the Preference Share Directors.

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(v) Election to Board. For the avoidance of doubt, an individual who is elected a Preferred Share Director by the Voting Holders pursuant to this Section 12(b) is not a director unless he or she is appointed by the Board of Directors, or elected by the Members, to the Board pursuant to the Bye-laws. Therefore, once a Preference Share Director is elected by the Voting Holders pursuant to this Section 12(b), the Company shall use its reasonable best efforts to cause such Preference Share Director to be appointed by the Board, or elected by the Members, to the Board of Directors pursuant to the Bye-Laws as soon as practical.

(vi) Termination; Removal. Whenever the Company has paid cumulative dividends in full for at least four consecutive quarterly dividend periods on the Convertible Preference Shares and any other class or series of cumulative Parity Dividend Shares, and has paid cumulative dividends in full on any class or series of cumulative Parity Dividend Shares, then the right of the Holders to elect the Preference Share Directors will cease (but subject always to the same provisions for the vesting of the special voting right in the case of any Nonpayment in respect of future Quarterly Dividend Periods). The terms of office of the Preference Share Directors will immediately terminate, and the Board of Directors shall resolve to reduce the number of directors constituting the Board of Directors by two. In addition, any Preference Share Director may be removed at any time with cause (as such term is defined in the Bye-laws) by Voting Holders holding a majority in aggregate Liquidation Preference of the aggregate liquidation preference of the Convertible Preference Shares, together with all classes and series of Parity Dividend Shares having like voting rights, voting separately as a single class without regard to class or series (and with voting rights allocated pro rata based on the liquidation preference of each such class or series), to the exclusion of the holders of Common Shares, at a general meeting of Members or a special meeting of Voting Holders called by the Company as provided in Section 12(b)(iv) above. In addition, if the Board of Directors determines in its discretion at any time that there is cause (as such term is defined in the Bye-laws), such director’s term shall automatically terminate on the date of the duly passed resolution of the Board of Directors. Upon the removal of any Preference Share Director, the vacancy shall be filled in the manner set forth in Section 12(b)(iii). Notwithstanding the foregoing, if at any time there are no Convertible Preference Shares issued and outstanding, each Preference Share Director’s term shall automatically terminate and no directors shall thereafter be appointed or elected pursuant to this Section 12.

(c) Senior Issuances; Adverse Changes. So long as any Convertible Preference Shares are issued and outstanding, the Company may not consummate any action specified in clauses (i), (ii) or (iii) below without the vote or consent of the holders of a two-thirds majority in aggregate Liquidation Preference of the Convertible Preference Shares at the time issued and outstanding and all voting or consenting as a single class, to the exclusion of the holders of Common Shares:

(i) any amendment, alteration or repeal of any provision of the Memorandum of Association or Bye-laws or this Certificate of Designations that would alter or change the voting powers, preferences or special rights of the Convertible Preference Shares so as to affect them adversely;

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(ii) any authorization or creation of, or increase in the authorized amount of, any Senior Shares;

(iii) any consolidation, merger, amalgamation, scheme of arrangement, other binding share exchange or reclassification involving the Company, except that, subject to applicable law, Holders of Convertible Preference Shares will have no right to vote or consent under this clause (iii) (or under clause (i) above) by reason of any such transaction if (A) the Convertible Preference Shares remain issued and outstanding or, in the case of any such transaction with respect to which the Company is not the surviving or resulting issuer, are converted into or exchanged for preferred securities of the surviving or resulting entity or its ultimate parent (provided that such entity is an entity organized and existing under the laws of Bermuda, the United States of America, any state thereof or the District of Columbia or any jurisdiction in the European Economic Area, and is a corporation for U.S. federal income tax purposes (or if such entity is not a corporation for such purposes, the Company receives an opinion of nationally recognized counsel experienced in such matters to the effect that Holders will be subject to tax for U.S. federal income tax purposes with respect to such new preferred securities after such transaction in the same amount, at the same time and otherwise in the same manner as would have been the case under the Convertible Preference Shares prior to such transaction)), and (B) the Convertible Preference Shares remaining issued and outstanding or such other preferred securities, as the case may be, have such rights, preferences, privileges and voting powers, taken as a whole, as are not less favorable to the holders thereof than the rights, preferences, privileges and voting powers of the Convertible Preference Shares, taken as a whole;

provided, however, that (1) any increase in the amount of the authorized or issued, or any creation of, Convertible Preference Shares or any authorization, issuance or creation of any securities convertible into, or exercisable or exchanged for, Convertible Preference Shares or (2) any increase in the amount of the authorized or issued, or any creation of, any other preference shares ranking equally with or junior to the Convertible Preference Shares with respect to the payment of dividends (whether such dividends are cumulative or non-cumulative) and the distribution of assets upon the Company’s liquidation, dissolution or winding up, or any authorization, issuance or creation of any securities convertible into, or exercisable or exchangeable for, any such other preference shares, in each case (1) and (2) will not be deemed to adversely affect the voting powers, preferences or special rights of the Convertible Preference Shares and Holders will have no right under this Section 12(c) to vote on or consent to any such increase, authorization, issuance or creation.

If the Holders are entitled to vote on or consent to a specified action pursuant to this Section 12(c), the Company may call a meeting of the Holders for the purpose of such vote or, in its discretion, may instead seek the consent of the Holders in a written resolution. Any such vote

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may be held at a general meeting of the Members, or at a special meeting of the Holders and such other holders, as the Company may determine in its discretion. The Company may fix a date as the record date for the purpose of determining the issued and outstanding Convertible Preference Shares, and the Holders entitled to vote on or consent to any such specified action. At any meeting of Members or Holders where such vote is to occur (or for any consent by written resolution), the necessary quorum for such vote (or consent) shall be at least two Persons holding or representing by proxy at least 50% in aggregate liquidation preference of the Convertible Preference Shares entitled to vote on the relevant specified action.

If the Holders of Convertible Preference Shares are entitled to vote on or take any action with respect to any matter, the Board of Directors may, in its discretion, determine that such vote or other action be taken by means of a written resolution of the Holders entitled to take such action. Unless authorized by the Board of Directors, the Holders shall have no right to act by written resolution, notwithstanding any provision of the Bye-laws, this Certificate of Designations or otherwise.

(d) Vote with Common Shares. The Holders:

(i) shall be entitled to vote with the holders of the Common Shares on all matters submitted for a vote of holders of Common Shares, voting together with the holders of Common Shares (and not as a separate class or series), which shall include the right of the Holders to vote together with the holders of the Common Shares for the election of directors at any annual general meeting,

(ii) shall be entitled to a number of votes equal to the number of votes to which Common Shares issuable upon conversion of such Convertible Preference Shares would have been entitled if such Common Shares had been issued and outstanding at the time of the applicable vote and related record date, and

(iii) shall be entitled to notice of any Members meeting in accordance with the Bye-laws.

(e) No Vote if Redemption. No vote or consent of the Holders shall be required pursuant to Section 12(b), (c) or (d) if, at or prior to the time when the act with respect to which such vote or consent would otherwise be required shall be effected, the Company shall have redeemed or shall have called for redemption all issued and outstanding Convertible Preference Shares, with proper notice and sufficient funds having been set aside for such redemption, in each case pursuant to Section 6 above.

Section 13.

Preemption.

The Holders shall not have any rights of preemption with regard to any capital shares (including common shares and preferred shares).

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Section 14.

Payments and Notices.

(a) Payment. Any payment due by the Company with respect to dividends, redemptions, fractional shares or other amounts on a day that is not a Business Day may be made on the next succeeding Business Day with the same force and effect as if made on the original due date, and without any interest due to any delay in payment.

(b) Notices. Any notices, deliveries or other actions required or permitted to be given, made or taken by the Company or any Holder hereunder on a particular day may be effected on the next succeeding Business Day with the same force and effect as if effected on the particular day.

Section 15.

Rank.

Notwithstanding anything set forth in the Memorandum of Association, the Bye-laws or this Certificate of Designations to the contrary, the Board of Directors or any duly authorized committee thereof, without the vote of the Holders, may authorize and issue new or additional Junior Shares and Parity Shares. Neither the Board of Directors nor any committee thereof shall have the authority to create or issue any Senior Shares without the affirmative vote (or written consent) of the holders of a majority in aggregate Liquidation Preference of the outstanding Convertible Preference Shares, voting (or consenting) separately as a class, as provided in Section 12(c).

Section 16.

Repurchase.

Subject to the limitations imposed herein and applicable Bermuda law, the Company may purchase Convertible Preference Shares from time to time to such extent, in such manner and upon such terms as the Board of Directors or any duly authorized committee thereof may determine; provided, however, that the Company shall not use any of its funds for any such purchase when there are reasonable grounds to believe that the Company is, or after such purchase would be, unable to pay its liabilities as they become due; and provided further that in the event that the Company beneficially owns any Convertible Preference Shares, the Company will procure that voting rights in respect of such Convertible Preference Shares are not exercised.

Section 17.

Unissued or Reacquired Shares.

Convertible Preference Shares not issued or that have been issued and converted, redeemed or otherwise purchased or acquired by the Company shall be restored to the status of authorized but unissued preference shares without designation as to series, until such shares are once more designated as part of a particular series by the Board of Directors.

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Section 18.

No Sinking Fund.

Convertible Preference Shares are not subject to the operation of a sinking fund.

Section 19.

Reservation of Common Shares.

(a) Sufficient Shares. The Company shall at all times reserve and keep available out of its authorized and unissued Common Shares or shares acquired by the Company, solely for issuance upon the conversion of Convertible Preference Shares as provided in this Certificate of Designations, free from any preemptive or other similar rights, such number of Common Shares as shall from time to time be issuable upon the conversion of all the Convertible Preference Shares then issued and outstanding. For purposes of this Section 19(a), the number of Common Shares that shall be deliverable upon the conversion of all issued and outstanding Convertible Preference Shares shall be computed as if at the time of computation all such outstanding shares were held by a single Holder.

(b) Use of Acquired Shares. Notwithstanding the foregoing, the Company shall be entitled to deliver upon conversion of Convertible Preference Shares, as herein provided, Common Shares acquired by the Company (in lieu of the issuance of authorized and unissued Common Shares), so long as any such acquired shares are free and clear of all liens, charges, security interests or encumbrances (other than liens, charges, security interests and other encumbrances created by the Holders).

(c) Free and Clear Delivery. All Common Shares delivered upon conversion of the Convertible Preference Shares shall be duly authorized, validly issued, fully paid and non-assessable, free and clear of all liens, claims, security interests and other encumbrances (other than liens, charges, security interests and other encumbrances created by the Holders).

(d) Compliance with Law. Prior to the delivery of any securities that the Company shall be obligated to deliver upon conversion of the Convertible Preference Shares, the Company shall use its reasonable best efforts to comply with all laws and regulations thereunder requiring the approval of such delivery by any Regulatory Entities.

(e) Listing. The Company hereby covenants and agrees that, if at any time the Common Shares shall be listed on the New York Stock Exchange or any other securities exchange or quotation system, the Company will, if permitted by the rules of such exchange or quotation system, list and keep listed, so long as the Common Shares shall be so listed on such exchange or quotation system, all the Common Shares issuable upon conversion of the Convertible Preference Shares.

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Section 20.

Transfer Agent, Conversion Agent, Registrar and Paying Agent.

The duly appointed Transfer Agent, Conversion Agent, Registrar and paying agent for the Convertible Preference Shares shall be Computershare Trust Company, N.A. The Company may, in its sole discretion, remove the Transfer Agent in accordance with the agreement between the Company and the Transfer Agent; provided that the Company shall appoint a successor transfer agent who shall accept such appointment prior to the effectiveness of such removal. Upon any such removal or appointment, the Company shall send notice thereof by first-class mail, postage prepaid, to the Holders (or otherwise pursuant to any applicable procedures of a Depositary).

Section 21.

Replacement Certificates.

(a) Mutilated, Destroyed, Stolen and Lost Certificates. If physical certificates are issued, the Company shall replace any mutilated certificate at the Holder’s expense upon surrender of that certificate to the Transfer Agent. The Company shall replace certificates that become destroyed, stolen or lost at the Holder’s expense upon delivery to the Company and the Transfer Agent of satisfactory evidence that the certificate has been destroyed, stolen or lost, together with any indemnity that may be required by the Transfer Agent and the Company.

(b) Certificates Following Conversion. If physical certificates are issued, the Company shall not be required to issue any certificates representing the applicable Convertible Preference Shares on or after the applicable Conversion Date. In place of the delivery of a replacement certificate following the applicable Conversion Date, the Transfer Agent, upon delivery of the evidence and indemnity described in Section 21(a), shall deliver the Common Shares pursuant to the terms of the Convertible Preference Shares formerly evidenced by the certificate.

(c) Legends. Certificates for Convertible Preference Shares and any Common Shares issued on conversion thereof may have notations, legends or endorsements required by law, stock exchange rules, agreements to which the Company is subject, if any, or usage (provided that any such notation, legend or endorsement is in a form acceptable to the Company).

-33-

Section 22.

Form.

(a) Global Preference Shares. Convertible Preference Shares may, at the Company’s option, in its sole discretion, be issued in the form of one or more permanent global shares of Convertible Preference Shares in definitive, fully registered form with a global legend in substantially the form attached hereto as Exhibit A (each, a “Global Preference Share”), which is hereby incorporated in and expressly made a part of this Certificate of Designations. The Global Preference Shares may have notations, legends or endorsements required by law, stock exchange rules, agreements to which the Company is subject, if any, or usage (provided that any such notation, legend or endorsement is in a form acceptable to the Company). The aggregate number of shares represented by each Global Preference Share may from time to time be increased or decreased by adjustments made on the records of the Registrar and the Depositary or its nominee as hereinafter provided. Global Preference Shares shall be registered in the name of the Depositary, which shall be the Holder of such shares. This Section 22(a) shall apply only to a Global Preference Share deposited with or on behalf of the Depositary.

(b) Delivery to Depositary. If Global Preference Shares are issued, the Company shall execute and the Registrar shall, in accordance with this Section 22, countersign and deliver initially one or more Global Preference Shares that (i) shall be registered in the name of a nominee of the Depositary and (ii) shall be delivered by the Registrar to the Depositary or pursuant to instructions received from the Depositary or held by the Registrar as custodian for the Depositary pursuant to an agreement between the Depositary and the Registrar.

(c) Agent Members. If Global Preference Shares are issued, members of, or participants in, the Depositary (“Agent Members”) shall have no rights under this Certificate of Designations with respect to any Global Preference Share held on their behalf by the Depositary or by the Registrar as the custodian of the Depositary or under such Global Preference Shares, and the Depositary may be treated by the Company, the Registrar and any agent of the Company or the Registrar as the absolute owner of such Global Preference Share for all purposes whatsoever. Notwithstanding the foregoing, nothing herein shall prevent the Company, the Registrar or any agent of the Company or the Registrar from giving effect to any written certification, proxy or other authorization furnished by the Depositary or impair, as between the Depositary and its Agent Members, the operation of customary practices of the Depositary governing the exercise of the rights of a holder of a beneficial interest in any Global Preference Shares. If Global Preference Shares are issued, the Depositary may grant proxies or otherwise authorize any Person to take any action that a Holder is entitled to take pursuant to the Convertible Preference Shares, this Certificate of Designations or the Bye-laws.

(d) Physical Certificates. Owners of beneficial interests in any Global Preference Shares shall not be entitled to receive physical delivery of certificated Convertible Preference Shares, unless (x) the Depositary has notified the Company that it is unwilling or unable to continue as Depositary for the Global Preference Shares and the Company does not appoint a qualified replacement for the Depositary within 90 days, (y) the Depositary ceases to be a

-34-

“clearing agency” registered under the Exchange Act and the Company does not appoint a qualified replacement for the Depositary within 90 days or (z) the Company decides to discontinue the use of book-entry transfer through the Depositary. In any such case, the Global Preference Shares shall be exchanged in whole for definitive Convertible Preference Shares in registered form, with the same terms and of an equal aggregate Liquidation Preference. Such definitive Convertible Preference Shares shall be registered in the name or names of the Person or Persons specified by the Depositary in a written instrument to the Registrar.

(e) Signature. An Officer shall sign any Global Preference Share for the Company, in accordance with the Company’s Bye-laws and applicable law, by manual or facsimile signature. If an Officer whose signature is on a Global Preference Share no longer holds that office at the time the Transfer Agent countersigned the Global Preference Share, the Global Preference Share shall be valid nevertheless. A Global Preference Share shall not be valid until an authorized signatory of the Transfer Agent manually countersigns the Global Preference Share. Each Global Preference Share shall be dated the date of its countersignature.

Section 23.

Taxes.

(a) Transfer Taxes. The Company shall pay any and all share transfer, documentary, stamp and similar taxes that may be payable in respect of any issuance or delivery of Convertible Preference Shares or Common Shares or other securities issued on account of Convertible Preference Shares pursuant hereto or certificates representing such shares or securities. The Company shall not, however, be required to pay any such tax that may be payable in respect of any transfer involved in the issuance or delivery of Convertible Preference Shares, Common Shares or other securities in a name other than that in which the Convertible Preference Shares with respect to which such shares or other securities are issued or delivered were registered, or in respect of any payment to any Person other than a payment to the registered holder thereof, and shall not be required to make any such issuance, delivery or payment unless and until the Person otherwise entitled to such issuance, delivery or payment has paid to the Company the amount of any such tax or has established, to the satisfaction of the Company, that such tax has been paid or is not payable.

(b) Withholding. All payments and distributions (or deemed distributions) on the Convertible Preference Shares (and on the Common Shares received upon their conversion) shall be subject to withholding and backup withholding of tax to the extent required by law, subject to applicable exemptions, and amounts withheld, if any, shall be treated as received by Holders.

Section 24.

Notices.

All notices referred to herein shall be in writing, and, unless otherwise specified herein, all notices hereunder shall be deemed to have been given upon the earlier of receipt thereof or

-35-

three Business Days after the mailing thereof if sent by registered or certified mail (or by first class mail if the same shall be specifically permitted for such notice under the terms of this Certificate of Designations) with postage prepaid, addressed: (i) if to the Company, to its office at Clarendon House, 2 Church Street, Hamilton HM 11, Bermuda (Attention: Corporate Secretary) or to the Transfer Agent at its office at Computershare Trust Company, N.A. 250 Royall Street, Canton, MA 02021 (Attention: Corporate Trust Office), or to any other agent of the Company designated to receive such notice as permitted by this Certificate of Designations, or (ii) if to any Holder, to such Holder at the address of such Holder as listed in the share record books of the Company (which may include the records of the Transfer Agent) or (iii) to such other address as the Company or any such Holder, as the case may be, shall have designated by notice similarly given. Notwithstanding the foregoing, any notice given by the Company to Holders in respect of a Global Preference Share pursuant to the applicable procedures of the Depositary shall be deemed to have been given effectively when so given.

Section 25.

Other Rights.

Except as specifically provided in Section 12 or as may be required by Bermuda law, no holder of the Company’s common shares or preference shares shall have any right under this Certificate of Designations, the Memorandum of Association or the Bye-laws to vote on or consent to any amendment, alteration or repeal of this Certificate of Designations. The Convertible Preference Shares shall have no voting powers, preferences or special rights, and no qualifications, limitations or restrictions thereon, other than as set forth in this Certificate of Designations or in the Memorandum of Association or Bye-laws, or as required by Bermuda law.

Section 26.

Conflict.

To the extent the terms provided in this Certificate of Designations, conflict with the terms contained in the Bye-laws, the terms provided in this Certificate of Designations shall prevail.

-36-

IN WITNESS WHEREOF, this Certificate of Designations has been executed on behalf of the Company by its Chief Financial Officer this 18^th day of July, 2008.


MF GLOBAL LTD.

By:
		Name:
		Title:

-37-

Exhibit A

FORM OF

6% CUMULATIVE CONVERTIBLE PREFERENCE SHARES, SERIES A

FACE OF SECURITY

THE SECURITIES REPRESENTED BY THIS CERTIFICATE (AND THOSE ISSUABLE ON CONVERSION THEREOF) HAVE NOT BEEN REGISTERED UNDER THE U.S. SECURITIES ACT OF 1933 OR THE SECURITIES LAWS OF ANY U.S. STATE OR OTHER JURISDICTION AND MAY NOT BE SOLD OR OTHERWISE TRANSFERRED EXCEPT WHILE A REGISTRATION STATEMENT RELATING THERETO IS IN EFFECT UNDER SUCH ACT OR PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT, AND IN ACCORDANCE WITH ALL APPLICABLE U.S., STATE AND OTHER SECURITIES LAWS. THIS CERTIFICATE IS ISSUED PURSUANT TO AND IS SUBJECT TO THE RESTRICTIONS ON TRANSFER AND OTHER PROVISIONS OF AN INVESTMENT AGREEMENT AND A REGISTRATION RIGHTS AGREEMENT, EACH DATED AS OF [•], 2008 BETWEEN THE ISSUER OF THESE SECURITIES AND THE INVESTOR REFERRED TO THEREIN, COPIES OF WHICH ARE ON FILE WITH THE ISSUER. THE SECURITIES REPRESENTED BY THIS CERTIFICATE (AND THOSE ISSUABLE ON CONVERSION THEREOF) MAY NOT BE SOLD OR OTHERWISE TRANSFERRED EXCEPT IN COMPLIANCE WITH SAID AGREEMENTS, AND ANY SALE OR OTHER TRANSFER NOT IN COMPLIANCE WITH SAID AGREEMENTS WILL BE VOID.

[IF GLOBAL PREFERENCE SHARES ARE ISSUED: UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION (“DTC”), NEW YORK, NEW YORK, TO THE COMPANY OR ITS AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY CERTIFICATE ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL IN AS MUCH AS THE REGISTERED OWNER HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

TRANSFERS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS IN WHOLE, AND NOT IN PART, TO NOMINEES OF DTC OR TO A SUCCESSOR THEREOF OR SUCH SUCCESSOR’S NOMINEE AND TRANSFERS OF PORTIONS OF THIS GLOBAL SECURITY SHALL BE LIMITED TO TRANSFERS MADE IN ACCORDANCE WITH THE RESTRICTIONS SET FORTH IN THE CERTIFICATE OF DESIGNATIONS REFERRED TO BELOW.]

IN CONNECTION WITH ANY TRANSFER, THE HOLDER WILL DELIVER TO THE REGISTRAR AND TRANSFER AGENT SUCH CERTIFICATES AND OTHER INFORMATION AS SUCH REGISTRAR AND TRANSFER AGENT MAY REQUIRE TO CONFIRM THAT THE TRANSFER COMPLIES WITH THE FOREGOING RESTRICTIONS.

A-1


Certificate Number_______		Number of Convertible Preference Shares______
CUSIP NO.: [ ]

6% Cumulative Convertible Preference Shares, Series A

(par value $1.00 per share)

MF GLOBAL LTD.

MF Global Ltd., a Bermuda exempted company (the “Company”), hereby certifies that [ ] (the “Holder”) is the registered owner of [•]1 [ , or such number as is registered in the name of the Holder in the Company’s register of members maintained by the Registrar]² fully paid and non-assessable preference shares of the Company designated the 6% Cumulative Convertible Preference Shares, Series A, with a par value of $1.00 per share and a liquidation preference of the greater of (A) U.S.$ 100 per share (plus all accumulated and unpaid dividends thereon, whether or not declared) and (B) the amount such Holder would have received if such Holder converted all of its Convertible Preference Shares as provided in the Certificate of Designation on the date of the liquidation, dissolution or winding up (the “Convertible Preference Shares”).

The Convertible Preference Shares are subject to the Certificate of Designations and the memorandum of association and bye-laws of the Company and are transferable in accordance therewith. The designations, rights, privileges, restrictions, preferences and other terms and provisions of the Convertible Preference Shares represented hereby are issued and shall in all respects be subject to the provisions of the Certificate of Designations dated [•], 2008 as the same may be amended from time to time (the “Certificate of Designations”). Capitalized terms used, but not defined herein, shall have the meaning given to them in the Certificate of Designations.

Reference is hereby made to select provisions of the Convertible Preference Shares set forth on the reverse hereof, and to the Certificate of Designations, which select provisions and the Certificate of Designations shall for all purposes have the same effect as if set forth at this place.

Upon receipt of this certificate, the Holder is bound by the Certificate of Designations and is entitled to the benefits thereunder.

Unless the Registrar has properly countersigned this certificate, the Convertible Preference Shares evidenced hereby shall not be entitled to any benefit under the Certificate of Designations or be valid or obligatory for any purpose.


MF GLOBAL LTD.		Dated: COUNTERSIGNED AND REGISTERED: COMPUTERSHARE TRUST COMPANY, N.A TRANSFER AGENT AND REGISTRAR

By:		By:
	Name: Title: Chief Executive Officer and Director		AUTHORIZED SIGNATURE




By:
		Name: Jacqueline Giammarco
		Title: Corporate Secretary

¹	This phrase should be included only if the share certificate evidences certificated Convertible Preference Shares.

²	This phrase should be included only if the share certificate evidences Global Preference Shares.

A-2

REVERSE OF SECURITY

Dividends on each of the Convertible Preference Shares shall be payable at the rate provided in the Certificate of Designations but only when, as and if declared by the Board of Directors as provided therein.

The Convertible Preference Shares shall be convertible in the manner and in accordance with the terms set forth in the Certificate of Designations.

The Convertible Preference Shares shall be redeemable at the option of the Company in the manner and in accordance with the terms set forth in the Certificate of Designations.

The Convertible Preference Shares carry voting rights as specified in the Certificate of Designations.

The Company shall furnish without charge to each holder who so requests the powers, designations, preferences and special rights of each class or series of share capital issued by the Company and the qualifications, limitations or restrictions on such powers, preferences and rights.

For value received, _________________________ hereby sell, assign and transfer unto

(PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS, INCLUDING POSTAL ZIP CODE, OF ASSIGNEE)

of the Convertible Preference Shares represented by the within Certificate, and such shares are subject to the Certificate of Designations and the memorandum of association and bye-laws of the Company and are transferable in accordance therewith.

Dated: _____________________________ 20_____

Signature: ___________________________________________________________

Signature: ____________________________________________________________


Notice:		The signature to this assignment must correspond with the name as written upon the face of the certificate, in every particular, without alteration or enlargement, or any change whatever.

A-3

Exhibit B

FORM OF DIRECTOR’S

ACCEPTANCE LETTER

TO:	MF Global Ltd. (the “Company”)

Attn:

The Secretary

I hereby accept and agree to my appointment or election as a Preference Share Director, in accordance with the Certificate of Designations of 6% Cumulative Convertible Preference Shares, Series A of the Company, dated [ ] 2008 (the “Certificate of Designations”). I hereby agree and acknowledge that my term of office shall immediately terminate in accordance with Section 12 of the Certificate of Designations without further action being required on my part.

I designate the following telephone and facsimile numbers and e-mail address for service of notice of all directors’ meetings. Notice by telephone facsimile or e-mail to either of the said numbers or e-mail address will constitute good and sufficient notice to myself and I agree to advise you of any change in these particulars.


Tel:		[ ]
Fax:		[ ]
E-mail:		[ ]
Nationality:		[ ]

I hereby authorize you to enter my name and address in the register of Directors and Officers of the Company as follows:

[Name]

[Address]

[Name]

B-1

EX-7.06 8 dex706.htm REGISTRATION RIGHTS AGREEMENT Registration Rights Agreement

Exhibit 7.06

REGISTRATION RIGHTS AGREEMENT

by and between

MF GLOBAL LTD.,

and

J.C. Flowers II L.P.

Dated as of July 18, 2008

TABLE OF CONTENTS


		Page
Section 1.	Certain Definitions	- 1 -

Section 2.	Right to Request Registration	- 5 -

Section 3.	Demand Registration	- 6 -

Section 4.	Piggyback Registrations	- 7 -

Section 5.	S-3 Shelf Registration	- 9 -

Section 6.	Suspension Periods; Blackout Periods	- 10 -

Section 7.	Holdback Agreements	- 11 -

Section 8.	Registration Procedures	- 12 -

Section 9.	Registration Expenses	- 17 -

Section 10.	Indemnification	- 17 -

Section 11.	Securities Act Restrictions	- 19 -

Section 12.	Transfers of Rights	- 20 -

Section 13.	Miscellaneous	- 20 -

- i -

THIS REGISTRATION RIGHTS AGREEMENT (this “Agreement”), is made and entered into as of July 18, 2008, by and between MF Global Ltd., a company incorporated in Bermuda (the “Company”), and J.C. Flowers II L.P. (the “Investor”).

WHEREAS, the Company and the Investor are parties to an Investment Agreement, dated May 20, 2008 pursuant to which the Investor is purchasing Preferred Shares from the Company;

WHEREAS, in connection with the consummation of the transactions contemplated by the Investment Agreement, the parties desire to enter into this Agreement in order to create certain registration rights for the Investor as set forth below;

NOW, THEREFORE, in consideration of the mutual covenants and agreements herein contained and other good and valid consideration, the receipt and sufficiency of which are hereby acknowledged, the parties to this Agreement hereby agree as follows:

Section 1. Certain Definitions.

In addition to the terms defined elsewhere in this Agreement, the following terms shall have the following meanings:

“Affiliate” of any Person means any other Person which directly, or indirectly through one or more intermediaries, controls, or is controlled by, or is under common control with, such Person. The term “control” (including the terms “controlling,” “controlled” and “under common control with”) as used with respect to any Person means the possession, direct or indirect, of the power to direct or cause the direction of the management and policies of such Person, whether through the ownership of voting securities, by contract or otherwise.

“Agreement” means this Registration Rights Agreement, including all amendments, modifications and supplements and any exhibits or schedules to any of the foregoing, and shall refer to this Registration Rights Agreement as the same may be in effect at the time such reference becomes operative.

“beneficially own” means, with respect to any Person, securities of which such Person or any of such Person’s Affiliates, directly or indirectly, has “beneficial ownership” as determined pursuant to Rule 13d-3 and Rule 13d-5 of the Exchange Act, including securities beneficially owned by others with whom such Person or any of its Affiliates has agreed to act together for the purpose of acquiring, holding, voting or disposing of such securities; provided that a Person shall not be deemed to “beneficially own” (i) securities tendered pursuant to a tender or exchange offer made by such Person or any of such Person’s Affiliates until such tendered securities are accepted for payment, purchase or exchange, (ii) any security as a result of an oral or written agreement, arrangement or understanding to vote such security if such agreement, arrangement or understanding: (a) arises solely from a revocable proxy given in response to a public proxy or consent solicitation made pursuant to, and in accordance with, the applicable provisions of the Exchange Act, and (b) is not also then reportable by such Person on Schedule 13D under the Exchange Act (or any comparable or successor report). Without limiting the foregoing, a Person shall be deemed to be the beneficial owner of all Registrable Shares owned of record by any majority- owned subsidiary of such Person.

“Common Shares” means any of the common shares, par value $1.00 per share, issued by the Company.

“Company” has the meaning set forth in the introductory paragraph.

“Demand Registration” has the meaning set forth in Section 2.

“Demand Registration Statement” has the meaning set forth in Section 3(a).

“Exchange Act” means the Securities Exchange Act of 1934.

“Form S-3” means a registration statement on Form S-3 under the Securities Act or such successor forms thereto permitting registration of securities under the Securities Act.

“Governmental Entity” means any national, federal, state, municipal, local, territorial, foreign or other government or any department, commission, board, bureau, agency, regulatory authority or instrumentality thereof, or any court, judicial, administrative or arbitral body or public or private tribunal.

“Holdback Agreement” has the meaning set forth in Section 7.

“Holdback Period” has the meaning set forth in Section 7.

“Investment Agreement” means the agreement specified in the first Recital hereto, as such agreement may be amended from time to time.

“Investor” means the Person named as such in the first paragraph of this Agreement until such time as any transferee of Registrable Shares succeeds to the rights and obligations of the Investor hereunder in accordance with Section 13, whereupon the “Investor” shall mean such successor transferee.

“Investor’s Counsel” has the meaning set forth in Section 8(a)(i).

“Investor Representative” has the meaning set forth in the Investment Agreement.

“Man Group” means Man Group plc or Man Group U.K. Ltd.

“Man Group Registration Rights Agreement” means the Registration Rights Agreement by and between the Company, Man Group plc and Man Group U.K. Ltd. dated as of July 18, 2007.

“Minimum Amount” means $100,000,000, or, provided that such amount represents all Registrable Shares held by the Investor, $50,000,000.

- 2 -

“Other Holdback Parties” has the meaning set forth in Section 7.

“Person” means any individual, sole proprietorship, partnership, limited liability company, joint venture, trust, incorporated organization, association, corporation, institution, public benefit corporation, Governmental Entity or any other entity.

“Piggyback Registration” has the meaning set forth in Section 4(a).

“Prospectus” means the prospectus or prospectuses (whether preliminary or final) included in any Registration Statement and relating to Registrable Shares, as amended or supplemented and including all material incorporated by reference in such prospectus or prospectuses.

“Preferred Shares” means any of the 6% Cumulative Convertible Preferred Shares, Series A of the Company having a par value of $1.00 per share.

“Purchased Securities” has the meaning set forth in the Investment Agreement.

“Registrable Shares” means, at any time, (i) the Purchased Securities held of record by the Investor as of the date hereof, (ii) Common Shares issued after the date hereof by the Company upon conversion of, or payment of dividends in respect of, the Purchased Securities specified in clause (i) pursuant to the terms thereof and (iii) any securities issued by the Company after the date hereof in respect of the Shares referred to in clauses (i) and (ii) by way of a share dividend or share split or in connection with a combination of shares, recapitalization, merger, consolidation or other reorganization, but excluding (iv) any and all such Preferred Shares, Common Shares and other securities referred to in clauses (i), (ii) and (iii) that at any time after the date hereof (a) have been sold pursuant to an effective registration statement or Rule 144 under the Securities Act, (b) have been sold in a transaction where a subsequent public distribution of such securities would not require registration under the Securities Act, (c) are eligible for sale pursuant to Rule 144 under the Securities Act without limitation thereunder on volume or manner of sale (which shall be not deemed to occur if the Investor owns more than 10% of the issued and outstanding Common Shares or any Investor Representative has served as a member of the Company’s board of directors during the past three months), (d) are not outstanding or (e) have been transferred in violation of Section 10 hereof or the provisions of the Investment Agreement or to a Person that does not become an Investor pursuant to Section 12 hereof (or any combination of clauses (a), (b), (c), (d) and (e)). The term “Registrable Preferred Shares” shall mean Preferred Shares that are also Registrable Shares. It is understood and agreed that, once a security of the kind described in clause (i), (ii) or (iii) above becomes a security of the kind described in clause (iv) above, such security shall cease to be a Registrable Share for all purposes of this Agreement and the Company’s obligations regarding Registrable Shares hereunder shall cease to apply with respect to such security.

“Registration Expenses” has the meaning set forth in Section 9(a).

“Registration Request” has the meaning set forth in Section 2.

- 3 -

“Registration Statement” means any registration statement of the Company which covers any of the Registrable Shares pursuant to the provisions of this Agreement, including the Prospectus, amendments and supplements to such Registration Statement, including post-effective amendments, all exhibits and all documents incorporated by reference in such Registration Statement.

“S-3 Shelf Registration” has the meaning set forth in Section 2.

“S-3 Shelf Registration Statement” has the meaning set forth in Section 5(a).

“SEC” means the Securities and Exchange Commission or any successor agency.

“Securities Act” means the Securities Act of 1933.

“Shares” means any of the Preferred Shares and Common Shares. If at any time Registrable Shares include securities of the Company other than Preferred Shares and Common Shares, then, when referring to Shares other than Registrable Shares, “Shares” shall include the class or classes of such other securities of the Company.

“Shelf Takedown” has the meaning set forth in Section 5(b).

“Start Date” means the first anniversary of the date of this Agreement.

“Suspension Period” has the meaning set forth in Section 6.

“Termination Date” means the earlier of (i) the first date on which there are no Registrable Shares or there is no Investor or (ii) the date ten years after the Start Date; provided that, in the case of clause (ii), such ten year period shall be extended by the number of days in any Suspension Period commenced pursuant to Section 5 during such period (as it may be so extended) and by the number of days in any Third Party Holdback Period commenced during such period (as it may be so extended).

“Third Party Holdback Period” means any Holdback Period imposed on the Investor pursuant to Section 6 in respect of an underwritten offering of Shares in which (i) the Investor was not permitted to participate or (ii) the Investor’s participation was reduced pursuant to Section 4(b) or Section 4(c).

“underwritten offering” means a registered offering in which securities of the Company are sold to one or more underwriters on a firm-commitment basis for reoffering to the public, and “underwritten Shelf Takedown” means an underwritten offering effected pursuant to an S-3 Shelf Registration.

- 4 -

In addition to the above definitions, unless the context requires otherwise:

(ii) “including” shall be construed as inclusive without limitation, in each case notwithstanding the absence of any express statement to such effect, or the presence of such express statement in some contexts and not in others;

(iii) references to “Section” are references to Sections of this Agreement;

(iv) words such as “herein”, “hereof”, “hereinafter” and “hereby” when used in this Agreement refer to this Agreement as a whole;

(v) references to “business day” mean a business day in The City of New York; and

(vi) references to “dollars” and “$” mean U.S. dollars.

Section 2. Right to Request Registration. Subject to the provisions hereof, at any time and from time to time following the Start Date and prior to the Termination Date, the Investor shall be entitled to request in writing (a “Registration Request”) (a) that the Company file a Registration Statement on Form S-3 (or an amendment or supplement to an existing registration statement on Form S-3) for a public offering of all or such portion of the Registrable Shares designated by the Investor pursuant to Rule 415 promulgated under the Securities Act or otherwise (an “S-3 Shelf Registration”), provided that the Company is then eligible to use Form S-3 and provided, further, that the Investor may make such request on no more than two occasions (subject to the following sentence) or (b) that the Company file effect the registration under the Securities Act of all or any part of the Registrable Shares by means other than an S-3 Shelf Registration (a “Demand Registration”), provided, that the Investor may make such request no more than once per calendar year (subject to the following sentence). A Registration Request shall not count for purposes of the limitations in this Section 2 if (i) the Investor determines in good faith to withdraw the proposed registration prior to the effectiveness of the Registration Statement relating to such request due to marketing conditions or regulatory reasons relating to the Company, (ii) the Registration Statement relating to such request does not become effective within 180 days of the date such Registration Statement is first filed with the SEC (other than solely by reason of the Investor having refused to proceed) and the Investor withdraws such request prior to such Registration Statement becoming effective, (iii) prior to the sale of at least 90% of the Registrable Shares included in the applicable registration relating to such request, such registration is adversely affected by any stop order, injunction or other order or requirement of the SEC or other governmental agency or court for any reason and the Company fails to have such stop order, injunction or other order or requirement removed, withdrawn or resolved to the Investor’s reasonable satisfaction within thirty days of the date of such order, (iv) more than 10% of the Registrable Shares requested by the Investor to be included in the registration are not so included pursuant to Section 2(b) (or Section 4(b), as applicable) or (v) in the case of an underwritten offering, the conditions to closing specified in the related underwriting agreement or purchase agreement entered into in connection with the registration relating to such request are not satisfied or waived (other than as a result of a material default or breach thereunder by the Investor).

- 5 -

Section 3. Demand Registration.

(a) Right to Demand Registrations. Upon receipt of a Registration Request for a Demand Registration, in accordance with the terms of this Agreement, the Company shall use its reasonable best efforts to file as soon as practicable (and in any event within 45 days) a Registration Statement registering for resale such number of Registrable Shares as requested in such Registration Request (a “Demand Registration Statement”) and to cause such Demand Registration Statement to be declared effective by the SEC as soon as practical thereafter. If permitted under the Securities Act, such Demand Registration Statement shall be one that is automatically effective upon filing. The Investor shall be entitled to request one underwritten offering pursuant to a Demand Registration, but only if the number of Registrable Shares to be sold in the offering would yield gross proceeds to the Investor of at least the Minimum Amount (based on then-current market prices). If any of the Registrable Shares covered by a Demand Registration are to be sold in an underwritten offering, the Company shall have the right to select the managing underwriter or underwriters to lead the offering subject to the prior written consent, not to be unreasonably withheld, of the Investor.

(b) Priority on Demand Registrations. The Company may include Shares other than Registrable Shares in a Demand Registration for any accounts on the terms provided below, if such Demand Registration is an underwritten offering, only with the consent of the managing underwriters of such offering. If the managing underwriters of the requested Demand Registration advise the Company and the Investor that in their reasonable opinion the number of Shares proposed to be included in the Demand Registration exceeds the number of Shares which can be sold in such underwritten offering without materially delaying or jeopardizing the success of the offering (including the price per share of the Shares proposed to be sold in such underwritten offering), the Company shall include in such Demand Registration only such number of Shares that in the reasonable opinion of such underwriters can be sold in such underwritten offering without materially delaying or jeopardizing the success of the offering (including the price per share of the Shares proposed to be sold in such underwritten offering), which Shares will be so included in the following order of priority: (i) first, the number of Registrable Shares that the Investor proposes to sell and (ii) second, the number of Shares proposed to be included therein by any other Persons (including Shares to be sold for the account of the Company) allocated among such Persons in such manner as the Company may determine. If the number of Shares which can be sold is less than the number of Shares proposed to be registered pursuant to clause (i) above by the Investor, the amount of Shares to be sold shall be allocated to the Investor.

(c) Restrictions on Demand Registrations. The Investor shall not be entitled to request a Demand Registration (i) within 60 days after the effective date of a Piggyback Registration, (ii) within 60 days of the pricing of any underwritten offering pursuant to a Demand Registration or an S-3 Shelf Registration or (iii) at any time when the Company is diligently pursuing a primary or secondary underwritten offering pursuant to a Piggyback

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Registration. Notwithstanding the foregoing, the Company shall not be obligated to proceed with a Demand Registration if the offering to be effected pursuant to such registration can be effected pursuant to an S-3 Shelf Registration and the Company, in accordance with Section 5, effects or has effected an S-3 Shelf Registration pursuant to which such offering can be effected. The right to request a Demand Registration may be exercised no more than once per calendar year, regardless of the number of transferees pursuant to Section 12.

(d) Effective Period of Demand Registrations. Upon the date of effectiveness of any Demand Registration, the Company shall use reasonable best efforts to keep such Demand Registration Statement effective with the SEC for a period equal to 60 days from such date or such shorter period which shall terminate when all of the Registrable Shares covered by such Demand Registration have been sold by the Investor pursuant to such Demand Registration. If the Company shall withdraw any Demand Registration pursuant to Section 5 before such 60 days end and before all of the Registrable Shares covered by such Demand Registration have been sold pursuant thereto, the Investor shall be entitled to a replacement Demand Registration which shall be subject to all of the provisions of this Agreement.

Section 4. Piggyback Registrations.

(a) Right to Piggyback.

Whenever on or after the Start Date and prior to the Termination Date the Company proposes to register any Shares under the Securities Act (other than on a registration statement on Form S-8, F-8, S-4 or F-4), whether for its own account or for the account of one or more holders of Shares (other than the Investor), and the form of registration statement to be used may be used for any registration of Registrable Shares (a “Piggyback Registration”), the Company shall give written notice to the Investor of its intention to effect such a registration and, subject to Sections 3(b) and 3(c), shall include in such registration statement and in any offering of Shares to be made pursuant to that registration statement all Registrable Shares with respect to which the Company has received a written request for inclusion therein from the Investor within 10 days after the Investor’s receipt of the Company’s notice (provided, without the consent of Man Group, in any registration initiated by Man Group pursuant to the Man Group Registration Rights Agreement, that only Registrable Shares of the same class or classes as the Shares being registered may be included and provided further that if the class or classes of Shares being registered in such Piggyback Offering are Common Shares, such Investor request may be contingent upon the Investor’s conversion of Registrable Preferred Shares into such Common Shares being registered and, in such event, the Company will reasonably cooperate with the Investor to coordinate such a conversion with the relevant offering). The Company shall have no obligation to proceed with any Piggyback Registration and may abandon, terminate and/or withdraw such registration for any reason at any time prior to the pricing thereof. If the Company or any other Person other than the Investor proposes to sell Shares in an underwritten offering pursuant to a registration statement on Form S-3 under the Securities Act, such offering shall be treated as a primary or secondary underwritten offering pursuant to a Piggyback Registration.

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(b) Priority on Primary Piggyback Registrations. If a Piggyback Registration is initiated as a primary underwritten offering on behalf of the Company and the managing underwriters advise the Company and the Investor (if the Investor has elected to include Registrable Shares in such Piggyback Registration) that in their opinion the number of Shares proposed to be included in such offering exceeds the number of Shares (of any class) which can be sold in such offering without materially delaying or jeopardizing the success of the offering (including the price per share of the Shares proposed to be sold in such offering), the Company shall include in such registration and offering only such number of Shares that in the opinion of such underwriters can be sold in such offering without materially delaying or jeopardizing the success of the offering (including the price per share of the Shares proposed to be sold in such underwritten offering), which Shares will be so included in the following order of priority: (i) first, the number of Shares that the Company proposes to sell, and (ii) second, the number of Shares requested to be included therein by holders of Shares, including the Investor (if the Investor has elected to include Registrable Shares in such Piggyback Registration), pro rata among all such holders on the basis of the number of Shares requested to be included therein by all such holders or as such holders and the Company may otherwise agree (with allocations among different classes of Shares, if more than one are involved, to be determined by the Company).

(c) Priority on Secondary Piggyback Registrations. If a Piggyback Registration is initiated as an underwritten registration on behalf of a holder of Shares other than the Investor, and the managing underwriters advise the Company that in their opinion the number of Shares proposed to be included in such registration exceeds the number of Shares (of any class) which can be sold in such offering without materially delaying or jeopardizing the success of the offering (including the price per share of the Shares to be sold in such offering), then the Company shall include in such registration and offering only such number of Shares that in the opinion of such underwriters can be sold in such offering without materially delaying or jeopardizing the success of the offering (including the price per share of the Shares proposed to be sold in such underwritten offering), which Shares will be so included in the following order of priority: (i) first, the number of Shares requested to be included therein by the holder(s) requesting such registration, (ii) second, the number of Shares requested to be included therein by other holders of Shares including the Investor (if the Investor has elected to include Registrable Shares in such Piggyback Registration) and (iii) third, the number of Shares that the Company proposes to sell, pro rata among such holders on the basis of the number of Shares requested to be included therein by such holders or as such holders and the Company may otherwise agree (with allocations among different classes of Shares, if more than one are involved, to be determined by the Company).

(d) Selection of Underwriters. If any Piggyback Registration is a primary or secondary underwritten offering, the Company shall have the right to select the managing underwriter or underwriters to administer any such offering.

(e) Basis of Participations. The Investor may not sell Registrable Shares in any offering pursuant to a Piggyback Registration unless it (a) agrees to sell such Shares on the basis provided in the underwriting or other distribution arrangements approved by the Company and (b) completes and executes all questionnaires, powers of attorney, indemnities, underwriting agreements, lockups and other documents required under the terms of such arrangements.

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Section 5. S-3 Shelf Registration.

(a) Right to S-3 Shelf Registration. A Registration Request for an S-3 Shelf Registration may not be made (i) within 60 days after the effective date of a Demand Registration or Piggyback Registration, (ii) within 60 days of the pricing of any underwritten offering pursuant to a Demand Registration or an S-3 Shelf Registration or (iii) at any time when the Company is diligently pursuing a primary or secondary underwritten offering pursuant to a registration statement. Upon receipt of a Registration Request for a S-3 Shelf Registration, the Company, in accordance with the provisions of this Agreement, shall use its reasonable best efforts to file as soon as practicable (and in any event within 30 days) a Registration Statement (or any amendment or supplement thereto) covering the number of shares of Registrable Shares specified in such request under the Securities Act on Form S-3 (an “S-3 Shelf Registration Statement”) for public sale in accordance with the method of disposition specified in such request and to cause such S-3 Shelf Registration Statement to become effective as soon as practical thereafter. If permitted under the Securities Act, each such Registration Statement shall be one that is automatically effective upon filing. The right to request an S-3 Shelf Registration may be exercised no more than twice in the aggregate, regardless of the number of Persons who may become an transferee pursuant to Section 12.

(b) Right to Effect Shelf Takedowns. The Investor shall be entitled, at any time and from time to time when an S-3 Shelf Registration Statement is effective and until the Termination Date, to sell such Registrable Shares as are then registered pursuant to such Registration Statement (each, a “Shelf Takedown”), but only upon not less than three (3) business days’ prior written notice to the Company (if such takedown is to be underwritten). The Investor shall be entitled to request that a Shelf Takedown shall be an underwritten offering; provided, however, that (based on the then-current market prices) the number of Registrable Shares included in each such underwritten Shelf Takedown would yield gross proceeds to the Investor of at least the Minimum Amount, and provided further that the Investor shall not be entitled to request any underwritten Shelf Takedown (i) within 60 days after the Investor has sold Shares in an underwritten offering effected pursuant to a Demand Registration and Piggyback Registration or S-3 Shelf Registration, (ii) within 60 days after the effective date of any Piggyback Registration, or (iii) at any time when the Company is diligently pursuing a primary or secondary underwritten offering pursuant to a registration statement. The Investor shall give the Company prompt written notice of the consummation of each Shelf Takedown (whether or not underwritten).

(c) Priority on Underwritten Shelf Takedowns. The Company may include Shares other than Registrable Shares in an underwritten Shelf Takedown for any accounts on the terms provided below, but only with the consent of the managing underwriters of such offering. If the managing underwriters of the requested underwritten Shelf Takedown advise the Company and the Investor that in their opinion the number of Shares proposed to be included in the underwritten Shelf Takedown exceeds the number of Shares which can be sold in such offering

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without materially delaying or jeopardizing the success of the offering (including the price per share of the Shares proposed to be sold in such offering), the Company shall include in such underwritten Shelf Takedown only such number of Shares that in the opinion of such underwriters can be sold in such offering without materially delaying or jeopardizing the success of the offering (including the price per share of the Shares proposed to be sold in such offering), which Shares will be so included in the following order of priority: (i) first, the number of Shares that the Investor proposes to sell, and (ii) second, the number of Shares proposed to be included therein by any other Persons (including Shares to be sold for the account of the Company) allocated among such Persons in such manner as the Company may determine. If the number of Shares which can be sold is less than the number of Registrable Shares proposed to be included in the underwritten Shelf Takedown pursuant to clause (i) above, the amount of Shares to be so sold shall be allocated to the Investor. The provisions of this paragraph (c) apply only to a Shelf Takedown that the Investor has requested be an underwritten offering.

(d) Selection of Underwriters. If any of the Registrable Shares are to be sold in an underwritten Shelf Takedown initiated by the Investor, the Company shall have the right to select the managing underwriter or underwriters to lead the offering subject to the prior written consent, not to be unreasonably withheld, of the Investor.

(e) Effective Period of S-3 Shelf Registrations. The Company shall use reasonable best efforts to keep any S-3 Shelf Registration Statement effective for a period of no less than six months after the effective date of such registration statement, provided that such six month period shall be extended by the number of days in any Suspension Period commenced pursuant to Section 6 during such period (as it may be so extended) and by the number of days in any Third Party Holdback Period commenced during such period (as it may be so extended). Notwithstanding the foregoing, the Company shall not be obligated to keep any such registration statement effective, or to permit Registrable Shares to be registered, offered or sold thereunder, at any time on or after the Termination Date.

Section 6. Suspension Periods; Blackout Periods.

(a) Suspension Periods. The Company may (i) delay the filing or effectiveness of a Registration Statement in conjunction with a Demand Registration or an S-3 Shelf Registration or (ii) prior to the pricing of any underwritten offering or other offering of Registrable Shares pursuant to a Demand Registration or an S-3 Shelf Registration, delay such underwritten or other offering (and, if it so chooses, withdraw any registration statement that has been filed), but in each case described in clauses (i) and (ii) only if the board of directors of the Company determines in good faith (x) that such delay would enable the Company to avoid disclosure of material information, the disclosure of which at that time would not be in the Company’s best interests, or (y) that the registration or offering to be delayed would, if not delayed, materially adversely affect the Company and its subsidiaries taken as a whole or materially interfere with, or jeopardize the success of, any pending or proposed material transaction, including any debt or equity financing, any acquisition or disposition, any recapitalization or reorganization or any other material transaction, whether due to commercial reasons, a desire to avoid premature disclosure of information or any other reason. Any period during which the Company has

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delayed a filing, an effective date or an offering pursuant to this Section 6 is herein called a “Suspension Period”. In no event shall there be more than two Suspension Periods during any rolling period of 365 days, and the number of days covered by any one or more Suspension Periods shall not exceed 180 days in the aggregate during any rolling period of 365 days. If pursuant to this Section 6 the Company delays or withdraws a Demand Registration or S-3 Shelf Registration requested by the Investor, the Investor shall be entitled to withdraw such request and, if it does so, such request shall not count against the limitation on the number of such registrations set forth in Section 2 or Section 5. The Company shall provide prompt written notice to the Investor of the commencement and termination of any Suspension Period (and any withdrawal of a registration statement pursuant to this Section 6), but shall not be obligated under this Agreement to disclose the reasons therefor. The Investor shall keep the existence of each Suspension Period confidential and refrain from making offers and sales of Registrable Shares (and direct any other Persons making such offers and sales to refrain from doing so) during each Suspension Period.

(b) Blackout Periods. At any time when an Investor Representative is a member of the Company’s board of directors (or the Investor designates an observer to attend board meetings), unless the Company otherwise permits by notice in writing to the Investor, the Investor shall not make any offers or sales of Registrable Shares during the period from and including the fifteenth day of the third month of a fiscal quarter of the Company to and including the business day after the day on which the Company publicly releases its earnings for such fiscal quarter, provided that the trading window applicable to the Company’s senior management under the Company’s trading policies then in effect is not open any time during such period.

(c) Other Lockups. Notwithstanding any other provision of this Agreement, the Company shall not be obligated to take any action hereunder that would violate any lockup or similar restriction binding on the Company in connection with a prior or pending registration or underwritten offering.

(d) Investment Agreement Restrictions. Nothing in this Agreement shall affect the restrictions on transfers of Shares and other provisions of the Investment Agreement, which shall apply independently hereof in accordance with the terms thereof.

Section 7. Holdback Agreements.

The restrictions in this Section 6 shall apply for as long as the Investor is the beneficial owner of any Registrable Shares or any Shares that were but have ceased to be Registrable Shares. If the Company sells Shares or other securities convertible into or exchangeable for (or otherwise representing a right to acquire) Shares in a primary underwritten offering pursuant to any registration statement under the Securities Act (whether or not the Investor is given an opportunity to participate), or if any other Person sells Shares in a secondary underwritten offering pursuant to a Piggyback Registration and the Investor is given an opportunity to participate in the offering, and if the managing underwriters for such offering advise the Company (in which case the Company promptly shall notify the Investor) that a public sale or distribution of Shares outside such offering would materially adversely affect such offering, then,

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if requested by the Company, the Investor shall agree, as contemplated in this Section 7, not to (and to cause its majority-controlled Affiliates not to) sell, transfer, pledge, issue, grant or otherwise dispose of, directly or indirectly (including by means of any short sale), or request the registration of, any Registrable Shares or former Registrable Shares (or any securities of any Person that are convertible into or exchangeable for, or otherwise represent a right to acquire, any such Shares) for a period (each such period, a “Holdback Period”) beginning on the 10^th day before the pricing date for the underwritten offering and extending through the earlier of (i) the 90^th day after such pricing date and (ii) such earlier day (if any) as may be designated for this purpose by the managing underwriters for such offering (each such agreement of the Investor, a “Holdback Agreement”). Each Holdback Agreement shall be in writing in form and substance satisfactory to the Company and the managing underwriters. Notwithstanding the foregoing, the Investor shall not be obligated to make a Holdback Agreement unless the Company, each selling shareholder in such offering and all of the Company’s officers and directors (collectively, “Other Holdback Parties”) also execute agreements substantially similar to such Holdback Agreement. Each Holdback Agreement shall provide that the Investor shall be released from its obligations thereunder if and when any of the Other Holdback Parties is released (in whole or in part) from the prohibition on offers and sales of Shares in its holdback agreement relating to the same offering (other than a release of an individual that is due to a personal hardship and affects only a small number of Shares), and the Company shall promptly notify the Investor of any such release. A Holdback Agreement shall not apply to (i) the exercise of any warrants or options to purchase shares of the Company (provided that such restrictions shall apply with respect to the securities issuable upon such exercise), (ii) transfers in accordance with Section 11 and Section 12, if the transferee also agrees in writing with the Company to be bound by such Holdback Agreement, or (iii) any Shares included in the underwritten offering giving rise to the application of this Section 7. A Holdback Agreement shall prohibit the Investor and its majority-controlled Affiliates from entering into any hedging or similar arrangement in respect of Shares.

Section 8. Registration Procedures.

(a) Whenever the Investor requests that any Registrable Shares be registered pursuant to this Agreement, the Company shall use reasonable best efforts to effect, as soon as practical as provided herein, the registration and the sale of such Registrable Shares in accordance with the intended methods of disposition thereof, and, pursuant thereto, the Company shall, as soon as practical as provided herein:

(i) subject to the other provisions of this Agreement, use reasonable best efforts to prepare and file with the SEC a Registration Statement with respect to such Registrable Shares and cause such Registration Statement to become effective (unless it is automatically effective upon filing); and before filing a Registration Statement or Prospectus or any amendments or supplements thereto, furnish to the Investor and the underwriters or other distributors, if any, identified by the Investor copies of all such documents proposed to be filed, including documents incorporated by reference in the Prospectus and one set of the exhibits incorporated by reference, and the Investor and a single counsel selected by the Investor (“Investor’s Counsel”) shall have a reasonable opportunity to review and comment on the Registration Statement and each such

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Prospectus (and each amendment or supplement thereto) before it is filed with the SEC, and the Investor shall have the opportunity to object to any information pertaining to the Investor that is contained therein and the Company will make the corrections reasonably requested by the Investor with respect to such information prior to filing any Registration Statement or Prospectus or any amendment or supplement thereto;

(ii) use reasonable best efforts to prepare and file with the SEC such amendments and supplements to such Registration Statement and the Prospectus used in connection therewith as may be necessary to comply with the applicable requirements of the Securities Act and to keep such Registration Statement effective for the relevant period required hereunder, but no longer than is necessary to complete the distribution of the Shares covered by such Registration Statement, and to comply with the applicable requirements of the Securities Act with respect to the disposition of all the Shares covered by such Registration Statement during such period in accordance with the intended methods of disposition set forth in such Registration Statement;

(iii) use reasonable best efforts to obtain the withdrawal of any order suspending the effectiveness of any Registration Statement, or the lifting of any suspension of the qualification or exemption from qualification of any Registrable Shares for sale in any jurisdiction in the United States;

(iv) furnish to the Investor and each managing underwriter, if any, without charge, conformed copies of each Registration Statement and amendment thereto and copies of each supplement thereto promptly after they are filed with the SEC (but only one set of exhibits thereto need be provided); and deliver, without charge, such number of copies of the preliminary and final Prospectus and any supplement thereto as the Investor may reasonably request in order to facilitate the disposition of the Registrable Shares of the Investor covered by such Registration Statement in conformity with the requirements of the Securities Act;

(v) use reasonable best efforts to register or qualify such Registrable Shares under such other securities or blue sky laws of such U.S. jurisdictions as the Investor reasonably requests and continue such registration or qualification in effect in such jurisdictions for as long as the applicable Registration Statement may be required to be kept effective under this Agreement (provided that the Company will not be required to (I) qualify generally to do business in any jurisdiction where it would not otherwise be required to qualify but for this subparagraph (v), (II) subject itself to taxation in any such jurisdiction or (III) consent to general service of process in any such jurisdiction);

(vi) notify the Investor and each distributor of such Registrable Shares identified by the Investor, at any time when a Prospectus relating thereto would be required under the Securities Act to be delivered by such distributor, of the occurrence of any event as a result of which the Prospectus included in such Registration Statement contains an untrue statement of a material fact or omits a material fact necessary to make the statements therein, in light of the circumstances under which they were made, not

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misleading, and, at the request of the Investor, the Company shall use reasonable best efforts to prepare, as soon as practical, a supplement or amendment to such Prospectus so that, as thereafter delivered to any prospective purchasers of such Registrable Shares, such Prospectus shall not contain an untrue statement of a material fact or omit to state any material fact necessary to make the statements therein, in light of the circumstances under which they were made, not misleading;

(vii) in the case of an underwritten offering in which the Investor participates pursuant to a Demand Registration, Piggyback Registration or an S-3 Shelf Registration, enter into an underwriting agreement containing such provisions (including provisions for indemnification, lockups, opinions of counsel and comfort letters) as are customary and reasonable for an offering of such kind, and take all such other customary and reasonable actions as the managing underwriters of such offering may request in order to facilitate the disposition of such Registrable Shares (including, making members of senior management of the Company available at reasonable times and places to participate in “road-shows” that the managing underwriter determines are necessary to effect the offering);

(viii) in the case of an underwritten offering in which the Investor participates pursuant to a Demand Registration, Piggyback Registration or an S-3 Shelf Registration, and to the extent not prohibited by applicable law or pre-existing applicable contractual restrictions, (A) make reasonably available, for inspection by the Investor, Investor’s Counsel, the managing underwriters of such offering and one attorney and accountant acting for such managing underwriters, pertinent corporate documents and financial and other records of the Company and its subsidiaries and controlled Affiliates, (B) cause the Company’s officers and employees to supply information reasonably requested by the Investor or such managing underwriters or attorney in connection with such offering (C) make the Company’s independent accountants available for any such managing underwriters’ due diligence and have them provide customary “cold comfort” letters to such underwriters in connection therewith; and (D) cause the Company’s counsel to furnish customary legal opinions to such underwriters in connection therewith; provided, however, that such records and other information shall be subject to such confidential treatment as is customary for underwriters’ due diligence reviews;

(ix) use reasonable best efforts to cause all such Registrable Shares to be listed on each securities exchange (if any) on which securities of the same class issued by the Company are then listed;

(x) provide a transfer agent and registrar for all such Registrable Shares not later than the effective date of such Registration Statement and, a reasonable time before any proposed sale of Registrable Shares pursuant to a Registration Statement, provide the transfer agent with printed certificates for the Registrable Shares to be sold, subject to the provisions of Section 12;

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(xi) make generally available to its shareholders a consolidated earnings statement (which need not be audited) for a period of 12 months beginning after the effective date of the Registration Statement as soon as reasonably practicable after the end of such period, which earnings statement shall satisfy the requirements of an earning statement under Section 12 of the Securities Act and Rule 158 thereunder; and

(xii) promptly notify the Investor and the managing underwriters of any underwritten offering, if any:

(1) when the Registration Statement, any pre-effective amendment, the Prospectus or any Prospectus supplement or any post-effective amendment to the Registration Statement has been filed and, with respect to the Registration Statement or any post-effective amendment, when the same has become effective;

(2) of any request by the SEC for amendments or supplements to the Registration Statement or the Prospectus or for any additional information regarding the Investor;

(3) of the notification to the Company by the SEC of its initiation of any proceeding with respect to the issuance by the SEC of any stop order suspending the effectiveness of the Registration Statement; and

(4) of the receipt by the Company of any notification with respect to the suspension of the qualification of any Registrable Shares for sale under the applicable securities or blue sky laws of any jurisdiction; and

keep Investor’s Counsel reasonably apprised as to the intention and progress of the Company with respect to any Registration Statement hereunder.

For the avoidance of doubt, the provisions of clauses (vii), (viii), (xi) and (xii) of this Section 7(a) shall apply only in respect of an underwritten offering and only if (based on market prices at the time the offering is requested by the Investor) the number of Registrable Shares to be sold in the offering would yield gross proceeds to the Investor of at least the Minimum Amount. Notwithstanding any provision of this Agreement, the Company shall not be obligated to prepare for inclusion in any Registration Statement any audited financial statements for any period other than a fiscal year of the Company beginning on or after April 1, 2005 or any unaudited financial statements for any period other than a first, second or third fiscal quarter of any such fiscal year.

(b) No Registration Statement (including any amendments thereto) shall contain any untrue statement of a material fact or omit to state a material fact required to be stated therein, or necessary to make the statements therein not misleading, and no Prospectus (including any supplements thereto) shall contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements therein, in light of the circumstances under which they were made, not misleading, in each case, except for any untrue statement or alleged untrue statement of a material fact or omission or alleged omission of a material fact made in reliance on and in conformity with written information furnished to the Company by or on behalf of the Investor or any underwriter or other distributor specifically for use therein.

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(c) At all times after the Company has filed a registration statement with the SEC pursuant to the requirements of the Securities Act and until the Termination Date, the Company shall use reasonable best efforts to continuously maintain in effect the registration statement of Common Shares under Section 12 of the Exchange Act and to use reasonable best efforts to file all reports required to be filed by it under the Securities Act and the Exchange Act and the rules and regulations adopted by the SEC thereunder, all to the extent required to enable the Investor to be eligible to sell Registrable Shares (if any) pursuant to Rule 144 under the Securities Act.

(d) The Company may require the Investor and each distributor of Registrable Shares as to which any registration is being effected to furnish to the Company any other information regarding such Person and the distribution of such securities as the Company may from time to time reasonably request.

(e) The Investor agrees by having its stock treated as Registrable Shares hereunder that, upon being advised in writing by the Company of the occurrence of an event pursuant to Section 8(a)(vi), the Investor will immediately discontinue (and direct any other Persons making offers and sales of Registrable Shares to immediately discontinue) offers and sales of Registrable Shares pursuant to any Registration Statement (other than those pursuant to a plan that is in effect prior to such time and that complies with Rule 10b5-1 of the Exchange Act) until it is advised in writing by the Company that the use of the Prospectus may be resumed and is furnished with a supplemented or amended Prospectus as contemplated by Section 8(a)(vi), and, if so directed by the Company, the Investor will deliver to the Company all copies, other than permanent file copies then in the Investor’s possession, of the Prospectus covering such Registrable Shares current at the time of receipt of such notice.

(f) The Company may prepare and deliver an issuer free-writing prospectus (as such term is defined in Rule 405 under the Securities Act) in lieu of any supplement to a prospectus, and references herein to any “supplement” to a Prospectus shall include any such issuer free-writing prospectus. Neither the Investor nor any other seller of Registrable Shares may use a free-writing prospectus to offer or sell any such shares without the Company’s prior written consent.

(g) It is understood and agreed that any failure of the Company to file a registration statement or any amendment or supplement thereto or to cause any such document to become or remain effective or usable within or for any particular period of time as provided in Section 2, Section 5 or Section 8 or otherwise in this Agreement, due to reasons that are not reasonably within its control, or due to any refusal of the SEC to permit a registration statement or prospectus to become or remain effective or to be used because of unresolved SEC comments thereon (or on any documents incorporated therein by reference) despite the Company’s good faith and reasonable best efforts to resolve those comments, shall not be a breach of this Agreement. However, neither shall any such failure relieve the Company of its obligations hereunder to continue to use reasonable best efforts to remedy such failure.

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(h) It is further understood and agreed that the Company shall not have any obligations under this Section 8 at any time on or after the Termination Date, unless an underwritten offering in which the Investor participates has been priced but not completed prior to the Termination Date, in which event the Company’s obligations under this Section 8 shall continue with respect to such offering until it is so completed (but not more than 60 days after the commencement of the offering).

Section 9. Registration Expenses.

(a) All expenses incurred by the Company in effecting any registration pursuant to this Agreement (whether or not such registration or prospectus becomes effective or final) or otherwise incident to the Company’s performance of or compliance with this Agreement, including all registration and filing fees, fees and expenses of compliance with securities or blue sky laws, NASD fees, listing application fees, printing expenses, transfer agent’s and registrar’s fees, cost of distributing Prospectuses in preliminary and final form as well as any supplements thereto, and fees and disbursements of counsel for the Company and all independent certified public accountants and other Persons retained by the Company, together with the reasonable documented fees and expenses of the Investor’s Counsel, up to an amount not to exceed $100,000 for each underwritten offering pursuant to Section 3(a) or Section 5(b), but not including any underwriting discounts or commissions attributable to the sale of Registrable Shares or fees and expenses of counsel and any other advisor representing any underwriters or other distributors (all such expenses being herein called “Registration Expenses”), shall be borne by the Company. The Investor shall bear the cost of all underwriting discounts and commissions associated with any sale of Registrable Shares and shall pay all fees and expenses of any counsel (and any other advisers) representing the Investor (other than the fees and expenses specified above).

(b) The obligation of the Company to bear the expenses described in Section 9(a) shall apply irrespective of whether a registration, once properly demanded or requested becomes effective or is withdrawn or suspended; provided, however, that Registration Expenses for any Registration Statement withdrawn solely at the request of the Investor (unless withdrawn following commencement of a Suspension Period pursuant to Section 6) shall be borne by the Investor.

Section 10. Indemnification.

(a) The Company shall indemnify, to the fullest extent permitted by law, the Investor and each Person who controls the Investor (within the meaning of the Securities Act) against all losses, claims, damages, liabilities, judgments, costs (including reasonable costs of investigation) and expenses (including reasonable attorneys’ fees) arising out of or based upon any untrue or alleged untrue statement of a material fact contained in any Registration Statement or Prospectus or any amendment thereof or supplement thereto or arising out of or based upon any omission or alleged omission of a material fact required to be stated therein or necessary to make the statements therein not misleading, except insofar as the same are made in reliance and in conformity with information furnished in writing to the Company by the Investor expressly for

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use therein. In connection with an underwritten offering in which the Investor participates conducted pursuant to a registration effected hereunder, the Company shall indemnify each participating underwriter and each Person who controls such underwriter (within the meaning of the Securities Act) to the same extent as provided above with respect to the indemnification of the Investor; provided, however, that this sentence shall apply only if (based on the current market prices immediately prior thereto) the number of Registrable Shares to be sold in the offering would yield gross proceeds to the Investor of at least the Minimum Amount (or if the Company otherwise approves the offering for purposes of this Section 9).

(b) In connection with any Registration Statement in which the Investor is participating, the Investor shall furnish to the Company in writing such information as the Company reasonably requests for use in connection with any such Registration Statement or Prospectus, or amendment or supplement thereto, and shall indemnify, to the fullest extent permitted by law, the Company, its officers and directors and each Person who controls the Company (within the meaning of the Securities Act) against all losses, claims, damages, liabilities, judgments, costs (including reasonable costs of investigation) and expenses (including reasonable attorneys’ fees) arising out of or based upon any untrue or alleged untrue statement of material fact contained in the Registration Statement or Prospectus, or any amendment or supplement thereto, or arising out of or based upon any omission or alleged omission of a material fact required to be stated therein or necessary to make the statements therein not misleading, but only to the extent that the same are made in reliance and in conformity with information furnished in writing to the Company by or on behalf of the Investor expressly for use therein.

(c) Any Person entitled to indemnification hereunder shall (i) give prompt written notice to the indemnifying Person of any claim with respect to which it seeks indemnification and (ii) permit such indemnifying Person to assume the defense of such claim with counsel reasonably satisfactory to the indemnified Person. Failure so to notify the indemnifying Person shall not relieve it from any liability that it may have to an indemnified Person except to the extent that the indemnifying Person is materially and adversely prejudiced thereby. The indemnifying Person shall not be subject to any liability for any settlement made by the indemnified Person without its consent (but such consent will not be unreasonably withheld). An indemnifying Person who is entitled to, and elects to, assume the defense of a claim shall not be obligated to pay the fees and expenses of more than one counsel (in addition to one local counsel) for all Persons indemnified (hereunder or otherwise) by such indemnifying Person with respect to such claim (and all other claims arising out of the same circumstances), unless in the reasonable judgment of any indemnified Person there may be one or more legal or equitable defenses available to such indemnified Person which are in addition to or may conflict with those available to another indemnified Person with respect to such claim, in which case such maximum number of counsel for all indemnified Persons shall be two rather than one). Failure to give prompt written notice shall not release the indemnifying Person from its obligations hereunder. The indemnifying Person shall not consent to the entry of any judgment or enter into or agree to any settlement relating to a claim or action for which any indemnified Person would be entitled to indemnification by any indemnified Person hereunder unless such judgment or settlement imposes no ongoing obligations on any such indemnified Person and includes as an

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unconditional term the giving, by all relevant claimants and plaintiffs to such indemnified Person, a release, satisfactory in form and substance to such indemnified Person, from all liabilities in respect of such claim or action for which such indemnified Person would be entitled to such indemnification. The indemnifying Person shall not be liable hereunder for any amount paid or payable or incurred pursuant to or in connection with any judgment entered or settlement effected with the consent of an indemnified Person unless the indemnifying Person has also consented to such judgment or settlement.

(d) The indemnification provided for under this Agreement shall remain in full force and effect regardless of any investigation made by or on behalf of the indemnified Person or any officer, director or controlling Person of such indemnified Person and shall survive the transfer of securities and the Termination Date but only with respect to offers and sales of Registrable Shares made before the Termination Date or during the period following the Termination Date referred to in Section 8(h).

(e) If the indemnification provided for in or pursuant to this Section 10 is due in accordance with the terms hereof, but is held by a court to be unavailable or unenforceable in respect of any losses, claims, damages, liabilities or expenses referred to herein, then each applicable indemnifying Person, in lieu of indemnifying such indemnified Person, shall contribute to the amount paid or payable by such indemnified Person as a result of such losses, claims, damages, liabilities or expenses in such proportion as is appropriate to reflect the relative fault of the indemnifying Person on the one hand and of the indemnified Person on the other in connection with the statements or omissions which result in such losses, claims, damages, liabilities or expenses as well as any other relevant equitable considerations. The relative fault of the indemnifying Person on the one hand and of the indemnified Person on the other shall be determined by reference to, among other things, whether the untrue or alleged untrue statement of a material fact or the omission or alleged omission to state a material fact relates to information supplied by the indemnifying Person or by the indemnified Person, and by such Person’s relative intent, knowledge, access to information and opportunity to correct or prevent such statement or omission. In no event shall the liability of the Investor be greater in amount than the amount for which such indemnifying Person would have been obligated to pay by way of indemnification if the indemnification provided for under Section 10(a) or Section 10(b) hereof had been available under the circumstances.

Section 11. Securities Act Restrictions.

The Registrable Shares are restricted securities under the Securities Act and may not be offered or sold except pursuant to an effective registration statement or an available exemption from registration under the Securities Act. Accordingly, the Investor shall not, directly or through others, offer or sell any Registrable Shares except pursuant to a Registration Statement as contemplated herein or pursuant to Rule 144 or another exemption from registration under the Securities Act, if available. Prior to any transfer of Registrable Shares other than pursuant to an effective registration statement, the Investor shall notify the Company of such transfer and the Company may require the Investor to provide, prior to such transfer, such evidence that the transfer will comply with the Securities Act (including written representations or an opinion of

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counsel) as the Company may reasonably request. The Company may impose stop-transfer instructions with respect to any Registrable Shares that are to be transferred in contravention of this Agreement. Any certificates representing the Registrable Shares may bear a legend (and the Company’s share registry may bear a notation) referencing the restrictions on transfer contained in this Agreement (and the Investment Agreement), until such time as such securities have ceased to be (or are to be transferred in a manner that results in their ceasing to be) Registrable Shares. Subject to the provisions of this Section 10, the Company will replace any such legended certificates with unlegended certificates promptly upon surrender of the legended certificates to the Company or its designee, in order to facilitate a lawful transfer or at any time after such shares cease to be Registrable Shares.

Section 12. Transfers of Rights. If the Investor transfers the Registrable Shares it owns to a third party, such party shall succeed to the rights and obligations of the Investor under this Agreement with respect to such Registrable Shares, but only if (i) the Investor transfers an amount of Registrable Shares to such party that represents, or if converted into Common Shares would represent, at least 10% of the then issued and outstanding Common Shares, (ii) the transfer complies with Section 10 of this Agreement and the Investment Agreement and (iii) such party signs and delivers to the Company a written acknowledgment (in form and substance satisfactory to the Company) that it has succeeded to the Investor as a party to this Agreement and has assumed the rights and obligations of the Investor hereunder. Each such transfer shall be effective when (but only when) the transferred securities are registered in the name of the transferee and the transferee has signed and delivered the written acknowledgment to the Company. Upon any such effective transfer, the transferee shall automatically become and have the rights and obligations of an Investor with respect to the Registrable Shares so transferred and the transferor shall automatically cease to be and to have the rights and obligations of an Investor with respect to any and all Shares (including the transferred Registrable Shares), provided that the rights and obligations of the transferor arising under Section 10 or otherwise hereunder with respect to periods and matters existing before such cessation shall survive such cessation. Notwithstanding any other provision of this Agreement, no Person who acquires securities transferred in violation of this Agreement or the Investment Agreement, or who acquires securities that are not or upon acquisition cease to be Registrable Shares, shall have any rights under this Agreement with respect to such securities, and such securities shall not have the benefits afforded hereunder to Registrable Shares.

Section 13. Miscellaneous.

(a) Notices. Except as otherwise provided herein, all notices, requests, consents and other communications required or permitted hereunder shall be in writing and shall be hand delivered, mailed (postage prepaid) by registered or certified mail or sent by e-mail or facsimile transmission (with telephone confirmation promptly thereafter),

If to the Company:

MF Global Ltd.

717 Fifth Avenue

New York, New York 10022

Attention: General Counsel

Facsimile: (212) 589-6236

E-mail: hschneider@mfglobal.com

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with a copy to:

Sullivan & Cromwell LLP

125 Broad Street

New York, New York 10004

Attention: David B. Harms

Facsimile: (212) 558-3588

Email: harmsd@sullcrom.com

If to the Investor:

J.C. Flowers II L.P.

c/o J.C. Flowers & Co. LLC

717 5^th Avenue, 26^th Floor

New York, New York 10022

Attention:

Facsimile:

Email:

with a copy to:

Debevoise & Plimpton LLP

919 Third Avenue

New York, New York 10022

Attention: Gregory V. Gooding, Esq.

Facsimile: (212) 521-7870

Email: ggooding@debevoise.com

or at such other address as any such party hereto may specify by written notice to the others, and, except as otherwise provided herein, each such notice, request, consent and other communication shall for all purposes of the Agreement be treated as being effective or having been given when delivered personally or by mail or, in the case of e-mail or facsimile delivery, upon receipt of e-mail or facsimile confirmation of delivery and telephonic confirmation.

(b) No Waivers. No failure or delay by any 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.

(c) Successors and Assigns. The provisions of this Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successors and permitted assigns, it being understood that there are no intended third party beneficiaries hereof (except as specified in Section 10 hereof).

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(d) Governing Law. This Agreement shall be governed by and construed in accordance with the law of the State of New York.

(e) Jurisdiction. Any suit, action or proceeding seeking to enforce any provision of, or based on any matter arising out of or in connection with, this Agreement or the transactions contemplated hereby must be brought in any federal or state court located in the Borough of Manhattan in The City of New York, and each of the parties hereby consents to the jurisdiction of such courts (and of the appropriate appellate courts therefrom) in any such suit, action or proceeding and irrevocably waives, to the fullest extent permitted by law, any objection which it may now or hereafter have to the laying of the venue of any such suit, action or proceeding in any such court or that any such suit, action or proceeding which is brought in any such court has been brought in an inconvenient forum. Process in any such suit, action or proceeding may be served on any party anywhere in the world, whether within or without the jurisdiction of any such court. Without limiting the foregoing, each party agrees that service of process on such party as provided in Section 13(a) shall be deemed effective service of process on such party.

(f) Waiver of Jury Trial. EACH OF THE PARTIES HERETO HEREBY IRREVOCABLY 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.

(g) Counterparts; Effectiveness. This Agreement may be executed in any number of counterparts (including by e-mail or facsimile) and by different parties hereto in separate counterparts, with the same effect as if all parties had signed the same document. All such counterparts shall be deemed an original, shall be construed together and shall constitute one and the same instrument. This Agreement shall become effective when each party hereto shall have received counterparts hereof signed by all of the other parties hereto.

(h) Entire Agreement. This Agreement contains the entire agreement between the parties hereto with respect to the subject matter hereof and supersedes and replaces all other prior agreements, written or oral, among the parties hereto with respect to the subject matter hereof.

(i) Captions. The headings and other captions in this Agreement are for convenience and reference only and shall not be used in interpreting, construing or enforcing any provision of this Agreement.

(j) Severability. If any term, provision, covenant or restriction of this Agreement is held by a court of competent jurisdiction or other authority to be invalid, void or unenforceable, the remainder of the terms, provisions, covenants and restrictions of this Agreement shall remain in full force and effect and shall in no way be affected, impaired or invalidated so long as the economic or legal substance of the transactions contemplated hereby is not affected in any manner materially adverse to any party. Upon such a determination, the parties shall negotiate in good faith to modify this Agreement so as to effect the original intent of the parties as closely as possible in an acceptable manner in order that the transactions contemplated hereby be consummated as originally contemplated to the fullest extent possible.

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(k) Amendments. (i) Except as provided in clause (ii) below, the provisions of this Agreement, including the provisions of this sentence, may not be amended, modified or supplemented, and waivers or consents to departures from the provisions hereof may not be given without the prior written consent of the Company and the Investor.

(ii) If the Company at any time after the date of this Agreement grants to any other holders of its securities any rights to request or cause the Company to effect the registration under the Securities Act or offering or sale of any such securities on any terms materially more favorable to such holders than the terms set forth in this Agreement, the terms of this Agreement shall, upon the request of the Investor, be deemed amended or supplemented to the extent necessary to provide the Investor such more favorable rights and benefits.

[Execution Page Follows]

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IN WITNESS WHEREOF, this Registration Rights Agreement has been duly executed by each of the parties hereto as of the date first written above.


MF GLOBAL LTD.

By:		/s/ Jacqueline M. Giammarco
		Name: Jacqueline M. Giammarco
		Title: Assistant General Counsel

J.C. FLOWERS II L.P.

By: JCF Associates II L.P., its General Partner

By: JCF Associates II Ltd., its General Partner

By:		/s/ Kristin H. Johnson
		Name: Kristin H. Johnson
		Title: Vice President

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