ACE LIMITED
CERTIFICATE OF THE POWERS, DESIGNATIONS,
PREFERENCES AND RIGHTS OF THE
___% CUMULATIVE REDEEMABLE PREFERRED SHARES, SERIES A
NO PAR VALUE PER SHARE
LIQUIDATION VALUE US$50 PER SHARE
The undersigned, the __________ of ACE Limited, a corporation duly
organized under the laws of the Cayman Islands (the "Company"), DOES HEREBY
CERTIFY that the following resolutions have been duly adopted by the Board of
Directors of the Company:
RESOLVED, that pursuant to the authority expressly granted to and vested in
the Board of Directors of the Company by the provisions of the Memorandum of
Association and Articles of Association, this Board of Directors hereby
authorizes the issuance of a series (this "Series") of the preferred shares of
the Company (the "Preferred Shares") which shall consist of ______ shares, and
this Board of Directors hereby fixes the powers, designations, preferences and
relative, participating, optional or other special rights, and the
qualifications, limitations or restrictions thereof, of the shares of this
Series (in addition to the powers, designations, preferences and relative,
participating, optional or other special rights and the qualifications,
limitations or restrictions thereof, set forth in the Articles of Association of
the Company which are applicable to the shares of this Series) as follows:
(i) Designation. The designation of this Series shall be the ___%
Cumulative Redeemable Preferred Shares, Series A. The number of shares of this
Series shall be _______. The liquidation preference of this Series shall be
US$50 per share.
(ii) Rank. The Preferred Shares shall, with respect to dividend rights and
dividend rights and upon liquidation, winding up and dissolution, rank (i)
senior to the Company's ordinary shares, US$0.041666667 par value per share (the
"Ordinary Shares"), and to all classes and series of capital stock of the
Company now or hereafter authorized, issued or outstanding, which by their terms
expressly provide that they rank junior to the Preferred Shares as to dividend
distributions and distributions upon the liquidation, winding up and dissolution
of the Company, or which do not specify their rank (collectively with the
Ordinary Shares, the "Junior Securities"); (ii) on a parity with each other
class of capital stock or series of preferred shares issued by the Company after
the date hereof, the terms of which specifically provide that such class or
series will rank on a parity with the Preferred Shares as to dividend
distributions and distributions upon the liquidation, winding up and dissolution
of the Company (collectively referred to as the "Parity Securities"); and (iii)
junior to each other class or series of capital stock issued by the Company
after the date hereof, the terms of which specifically provide that such class
or series will rank senior to the Preferred Shares as to dividend distributions
and
distributions upon the liquidation, winding up and dissolution of the Company
(collectively referred to as the "Senior Securities").
(iii) Dividends. Dividends are payable on the Preferred Shares as follows:
----- ---------
(a) The holders of the shares of this Series shall be entitled to
receive, out of funds legally available for that purpose, and when, as and
if declared by the Board of Directors of the Company, dividends payable in
cash at the annual rate of: (i) until May ___, 2003, ___% per annum and
(ii) thereafter, at the Reset Rate, in each case, of the liquidation
preference per Preferred Share.
(b) The dividend rate will be reset on the third Business Day
immediately preceding May___, 2003 and dividends shall accumulate on the
Preferred Shares at the Reset Rate from May___, 2003 to but excluding June
___, 2003. The Reset Agent shall determine the Reset Rate in the manner
provided in the Purchase Contract Agreement. On the Reset Announcement
Date, the Reset Spread and the One-Month Treasury Bill Rate to be used to
determine the Reset Rate will be announced by the Company. On the Business
Day immediately following the Reset Announcement Date, the Preferred Shares
holders will be notified of such Reset Spread and One-Month Treasury Bill
Rate by the Company. Such notice shall be sufficiently given to holders of
the shares of this Series if published in an Authorized Newspaper in The
City of New York. Not later than 7 calendar days nor more than 15 calendar
days prior to the Reset Announcement Date, the Company will notify DTC or
its nominee (or any successor Clearing Agency or its nominee) by first-
class mail, postage prepaid, to notify the beneficial owners or Clearing
Agency Participants holding Preferred Shares or Income PRIDES of such Reset
Announcement Date.
(c) Dividends on the Preferred Shares shall be fully cumulative and
shall accumulate, without interest, from April___, 2000, and shall be
payable in arrears in cash in equal quarterly payments on _______, _______,
_______ and _______ of each year, commencing _______, 2000 (each, a
"Dividend Payment Date"), to holders of record on the books and records of
the Company (1) so long as the Preferred Shares remain in book-entry only
form, at the close of business on the Business Day immediately preceding
the relevant Dividend Payment Date and (2) with respect to the Preferred
Shares not in book-entry form, as of the relevant record date established
by a resolution of the Board of Directors which shall be more than one
Business Day but less than 60 Business Days immediately preceding the
relevant Dividend Payment Date. If any date on which dividends on the
Preferred Shares are to be made is not a Business Day, payment of the
dividends payable on such date will be made on the next succeeding day that
is a Business Day, without any interest or other payment in respect of any
delay.
(d) Holders of the shares of this Series shall be entitled to receive
such dividends in preference to and in priority over dividends upon the
Junior Securities, but subject to the rights of holders of Senior
Securities. The Preferred Shares shall be on a parity as to dividends with
all Parity Securities.
2
(e) Except as described below, dividends on the Preferred Shares shall be
paid only in cash. The amount of dividends payable shall be computed on the
basis of a 360-day year of twelve 30-day months. The amount of dividends payable
for any period will be computed on the basis of the actual number of days
elapsed in that 90-day period. All dividends paid with respect to the Preferred
Shares pursuant to this section shall be paid pro rata to the holders entitled
thereto.
(f) In the event the Company does not declare or pay dividends on the
Preferred Shares through May ___, 2003, on May ___, 2003, instead of a cash
payment in respect of such dividends, holders of the shares of this Series will
be entitled to receive a number of Ordinary Shares of the Company equal to (1)
the aggregate liquidation preference of the Preferred Shares held by such holder
plus accumulated and unpaid dividends thereon, divided by (2) the average of the
closing prices per Ordinary Share on each of the twenty consecutive Trading Days
ending on the third Trading Day immediately preceding May ___, 2003.
(g) Accumulated but unpaid dividends for any past dividend period may be
declared by the Board of Directors and paid on any date fixed by the Board of
Directors, whether or not a Dividend Payment Date, to holders of record on the
books and records of the Company on any date fixed by the Board of Directors.
Holders of the shares of this Series shall not be entitled to any dividends in
excess of full cumulative dividends, as herein provided, on the Preferred
Shares. No interest, or sum of money in lieu of interest, shall be payable in
respect of any dividend payment on the Preferred Shares that may be in arrears.
(h) Payment Restrictions.
(1) So long as any Preferred Shares are outstanding, if the Company
does not pay dividends on the Preferred Shares on any Dividend Payment
Date, then, until all accumulated and unpaid dividends are paid and the
full quarterly dividend on the Preferred Shares for the current and all
prior dividend periods is declared or set apart for payment, the Company
may not declare or pay any dividend or make any distribution of assets on
any Junior Securities or make any guarantee payments with respect to the
foregoing, or redeem, purchase or otherwise acquire any Junior Securities.
(2) So long as any Preferred Shares are outstanding, if the Company
does not pay dividends on the Preferred Shares on any Dividend Payment
Date, then, until all accumulated and unpaid dividends are paid and the
full quarterly dividend on the Preferred Shares for the current and all
prior dividend periods is declared or set apart for payment, the Company
may not declare or pay any dividend or make any distribution of assets on
any Parity Securities or make any guarantee payments with respect to the
foregoing, unless such dividends are declared and paid pro rata so that the
amount of dividends declared and paid per share on the Preferred Shares and
any other Parity Securities in all cases shall bear to each other the
3
same ratio that the amount of accumulated but unpaid dividends per share on
the Preferred Shares and such other Parity Securities bear to each other.
(3) So long as any Preferred Shares are outstanding, if the Company
does not pay dividends on the Preferred Shares on any Dividend Payment
Date, then, until all accumulated and unpaid dividends are paid and the
full quarterly dividend on the Preferred Shares for the current and all
prior dividend periods is declared or set apart for payment, the Company
may not redeem, purchase or otherwise acquire any Parity Securities.
(4) Notwithstanding anything to the contrary set forth in Sections
(iii)(g)(1), (2) and (3) above, the payment restrictions set forth in such
Sections shall not apply to (A) dividends or distributions in Junior
Securities, (B) redemptions or purchases of any rights outstanding under a
shareholder rights plan of the Company, or any successor to such rights
plan, or the declaration of a dividend of such rights or the issuance of
stock under such plans in the future and (C) purchases of Junior Securities
related to the issuance of Junior Securities under any benefit plans of the
Company or its subsidiaries, as the case may be, for their respective
directors, officers or employees.
(i) Any dividend payment made on the shares of this Series shall be
credited first against the dividends accumulated with respect to the earliest
dividend period for which dividends have not been paid.
(iv) Remarketing.
---- -----------
(a) In accordance with the Remarketing Agreement and subject to the terms
of the Remarketing Underwriting Agreement, beneficial owners of Preferred Shares
that comprise components of Income PRIDES who have failed to notify the Purchase
Contract Agent on or prior to the fifth Business Day immediately preceding May
___, 2003 of their intention to settle the related Purchase Contract by Cash
Settlement on the Business Day immediately preceding May ___, 2003, will be
remarketed on the third Business Day immediately preceding May ___, 2003 in the
manner described in Section 5.4(b) of the Purchase Contract Agreement.
(b) In accordance with the Remarketing Agreement and subject to the terms
of the Remarketing Underwriting Agreement, on or prior to the fifth Business Day
immediately preceding May ___, 2003, but no earlier than the Dividend Payment
Date immediately preceding May ___, 2003, beneficial owners of Preferred Shares
that are separately traded from the Income PRIDES as the result of the creation
of Growth PRIDES (the "Separate Preferred Shares") may elect to have their
Preferred Shares remarketed by delivering the Preferred Shares to the Collateral
Agent together with a notice of such election to the collateral agent. Holders
of Preferred Shares electing to have their Preferred Shares remarketed will also
have the right to withdraw such election on or prior to the fifth Business Day
immediately preceding May ___, 2003. Such Preferred Shares shall be remarketed
in the manner described in Section 5.4(b) of the
4
Purchase Contract Agreement. In the event of a Failed Remarketing, the
Remarketing Agent shall promptly return the Separate Preferred Shares to the
Collateral Agent for release to the holders thereof.
(v) Repayment at Option of Holders.
--- ------------------------------
(a) If a Failed Remarketing has occurred, each holder of Separate
Preferred Shares shall have the right to require the Company to repay all or a
portion of such shares owned by such holder (the "Put Option") on May ____, 2003
(the "Put Option Exercise Date"), upon at least three Business Days' prior
notice, at a repayment price of $50 per share plus an amount equal to the
accumulated and unpaid dividends to the date of payment (the "Put Option
Repayment Price").
(b) In order for the Preferred Shares to be repaid on the Put Option
Exercise Date, the Company must receive on or prior to 4:00 p.m. on the third
Business Day immediately preceding the Put Option Exercise Date, at the office
of the Transfer Agent maintained for that purpose in The City of New York, the
Preferred Shares to be repaid with the form entitled "Option to Elect Repayment"
on the reverse thereof or otherwise accompanying such Preferred Share duly
completed. Any such notice received by the Company shall be irrevocable. All
questions as to the validity, eligibility (including time of receipt) and
acceptance of the Preferred Shares for repayment shall be determined by the
Company, whose determination shall be final and binding.
(c) Payment of the Put Option Repayment Price to holders of Preferred
Shares shall be made at the office of the Transfer Agent maintained for that
purpose in The City of New York, provided that the Transfer Agent has received
from the Company a sufficient amount of cash in connection with the related
repayment of the Preferred Shares no later than 1:00 p.m., New York City time,
on the Put Option Exercise Date by check or wire transfer in immediately
available funds at such place and to such account as may be designated by such
holders. If the Transfer Agent holds immediately available funds sufficient to
pay the Put Option Repayment Price of such Preferred Shares, then, immediately
prior to the close of business on the Put Option Exercise Date, such Preferred
Shares will cease to be outstanding and dividends thereon will cease to
accumulate, whether or not Preferred Shares are delivered to the Transfer Agent,
and all other rights of the holder in respect of the Preferred Shares shall
terminate and lapse (other than the right to receive the Put Option Repayment
Price but without interest on such Put Option Repayment Price). The Company
shall not be required to register or cause to be registered the transfer of any
Preferred Shares for which repayment has been elected. If payment of the Put
Option Repayment Price in respect of Preferred Shares is improperly withheld or
refused and not paid either by the Transfer Agent or the Company, dividends on
such Preferred Shares will continue to accumulate, from the original Put Option
Exercise Date to the actual date of payment, in which case the actual payment
date will be considered the Put Option Exercise Date for purposes of calculating
the Put Option Repayment Price.
5
(d) The Company will request, not later than 10 nor more than 15
calendar days prior to May ___, 2003 [(the date on which some or all of the
Preferred Shares could be remarketed in the manner described in Section
5.4(b) of the Purchase Contract Agreement)] that DTC notify the holders of
the Separate Preferred Shares as well as the Income PRIDES and Growth
PRIDES holders of such remarketing and of the procedures that must be
followed if a holder of Separate Preferred Shares wishes to exercise such
holder's rights with respect to the Put Option.
(vi) Mandatory Redemption. The Preferred Shares are not redeemable
prior to June ___, 2003. On June ___, 2003 (the "Redemption Date"), the
Preferred Shares shall be redeemed by the Company in whole for cash, out of any
source of funds legally available, at a redemption price equal to 100% of the
liquidation preference per Preferred Share plus all accumulated and unpaid
dividends thereon (the "Redemption Price"). The Preferred Shares are not subject
to any sinking fund.
(vii) Procedure for Mandatory Redemption.
----- ----------------------------------
(a) Upon redemption of the Preferred Shares pursuant to Section (vi)
hereof, notice of such redemption shall be mailed by first-class mail,
postage prepaid, not less than thirty (30) days nor more than sixty (60)
days prior to the Redemption Date to holders of record of the Preferred
Shares at their respective addresses as they shall appear in the books and
records of the company; provided, however, that the failure to give such
notice or any defect therein or in the mailing thereof shall not affect the
validity of the proceeding for the redemption of the Preferred Shares
except as to the holder to whom the Company has failed to give such notice
or except as to the holder to whom notice was defective. Each such notice
shall state: (1) the Redemption Date; (2) the redemption price; (3) the
place or places where certificates for such Preferred Shares are to be
surrendered for payment of the redemption price; (4) that dividends on the
Preferred Shares to be redeemed will cease to accumulate thereon unless the
Company shall default in payment of the Redemption Price; and (5) the CUSIP
number of the Preferred Shares being redeemed.
(b) If a notice of redemption shall have been given as aforesaid and
the Company shall have deposited on or before the Redemption Date a sum
sufficient to redeem the shares of this Series as to which a notice of
redemption has been given in trust with the Transfer Agent with irrevocable
instructions and authority to pay the Redemption Price to the holders
thereof, or if no such deposit is made, then upon the Redemption Date
(unless the Company shall default in making payment of the Redemption
Price), all rights of the holders thereof as shareholders of the Company by
reason of the ownership of such shares (except their right to receive the
Redemption Price thereof without interest) shall cease and terminate, and
such shares shall no longer be deemed outstanding for any purpose. The
Company shall be entitled to receive, from time to time, from the Transfer
Agent the interest, if any, earned on such moneys deposited with it, and
the holders of any shares so redeemed shall have no claim to any such
interest. In case the holder of any shares of this Series so called for
redemption shall not claim the Redemption Price for its shares within six
(6) years after the date of redemption, the Transfer Agent shall, upon
demand, pay
6
over to the Company such amount remaining on deposit, and the Transfer
Agent shall thereupon be relieved of all responsibility to the holder of
such shares, and such holder shall look only to the Company for payment
thereof. After such six-year period, the right of any shareholder or other
Person to receive such payment may be forfeited in the manner and with the
effect provided under applicable law.
(c) Not later than 1:00 p.m., New York City Time, on the Business Day
immediately preceding the Redemption Date, the Company shall irrevocably
deposit with the Transfer Agent sufficient funds for the payment of the
Redemption Price for the shares to be redeemed on the Redemption Date and
shall give the Transfer Agent irrevocable instructions to apply such funds,
and, if applicable and so specified in the instructions, the income and
proceeds therefrom, to the payment of such Redemption Price. The Company
may direct the Transfer Agent to invest any such available funds, provided
that the proceeds of any such investment will be available to the Transfer
Agent in The City of New York at the opening of business on such Redemption
Date.
(d) [Except as otherwise expressly set forth in this paragraph and
under applicable law, nothing contained in this certificate shall limit any
legal right of the Company to purchase or otherwise acquire any shares of
this Series at any price, whether higher or lower than the Redemption
Price, in private negotiated transactions, the over-the-counter market or
otherwise; provided that the Company may not purchase or otherwise acquire
shares of this Series unless all accumulated and unpaid dividends on all
outstanding shares of the this Series for all dividend period(s)
terminating on or before the date of such purchase or acquisition shall
have been or are being contemporaneously paid or set apart for payment.]
(e) If the Company shall not have funds legally available for the
redemption of all of the shares of this Series on the Redemption Date, the
Company shall redeem on the Redemption Date only the number of shares of
this Series as it shall have legally available funds to redeem, as
determined in an equitable manner, and the remainder of the shares of this
Series shall be redeemed, at the option of the Company, on the earliest
practicable date next following the day on which the Company shall first
have funds legally available for the redemption of such shares.
(f) Prior to calling the shares of this Series for redemption in
accordance with this Section, the Company, by resolution of its Board of
Directors, shall, to the extent of the redemption amount, to the extent of
any such funds legally available therefor and to the extent permitted by
law, declare a dividend on the shares of this Series payable on or prior to
the Redemption Date in an amount equal to any accumulated and unpaid
dividends on the shares of this Series as of such date.
(viii) Liquidation Preference.
------ ----------------------
(a) The liquidation preference of shares of this Series, in case of
the voluntary or involuntary liquidation, dissolution or winding-up of the
Company, shall be US$50 per
7
share, plus the amount per share of any dividends accumulated thereon and
remaining unpaid at the date of such liquidation, dissolution or winding-
up.
(b) In the event of any voluntary or involuntary liquidation,
dissolution or winding-up of the Company, the holders of shares of this
Series shall be entitled to receive the liquidation price of such shares
held by them in preference to and in priority over any distributions upon
all Junior Securities, but subject to the rights of holders of Senior
Securities. Upon payment in full of the liquidation price to which the
holders of shares of this Series are entitled, the holders of shares of
this Series will not be entitled to any further participation in any
distribution of assets by the Company. If the assets of the Company are not
sufficient to pay in full the liquidation price payable to the holders of
shares of this Series and the liquidation price payable to the holders of
all Parity Shares, the holders of all such shares shall share ratably in
such distribution of assets in accordance with the amounts which would be
payable on such distribution if the amounts to which the holders of shares
of this Series and the holders of Parity Shares are entitled were paid in
full.
(c) Neither a consolidation or merger of the Company with or into any
other corporation, nor a merger of any other corporation with or into the
Company, nor a sale or transfer of all or any part of the Company's assets
for cash, securities or other property shall be considered a liquidation,
dissolution or winding-up of the Company within the meaning of this Section
(viii).
(ix) Reacquired Shares. All shares of this Series which are at any time
redeemed pursuant to Section (vii) above shall have the status of authorized but
unissued Preferred Shares, without designation as to series, subject to
reissuance by the Board of Directors of the Company as shares of this Series or
shares of any one or more other series.
(x) Voting Rights. Except as indicated below or as otherwise required by
applicable law, holders of shares of this Series will not have voting rights.
(a) If at any time dividends payable on the shares of this Series
are in arrears and unpaid in an aggregate amount equal to or exceeding the
aggregate amount of dividends payable thereon for six quarterly dividend
periods, the holders of the shares of this Series, together with the
holders of any other series of Parity Securities as to which dividends are
in arrears and unpaid in an aggregate amount equal to or exceeding the
aggregate amount of dividends payable for six quarterly dividend periods
(but only if the holders of the shares of such other series would otherwise
have a right to elect Directors as a result of a dividend arrearage), will
have the special and exclusive right (superseding the separate right of
such other series to elect Directors so long as shares of this Series
remain outstanding, except as otherwise expressly provided in the
certificate of designation establishing such other series), voting
separately as a class with any such other series, to elect two Directors of
the Company, such Directors to be in addition to the number of Directors
constituting the Board of Directors of the Company immediately prior to the
accrual of such right. Such right of the holders of shares of this Series
to elect two Directors shall, when vested, continue until all accumulated
dividends on the shares of
8
this Series shall have been paid in full and, when so paid, such right of
the holders of shares of this Series to elect two Directors separately as a
class shall terminate, subject to revesting in the event of each and every
subsequent default in an aggregate amount equivalent to six full quarterly
dividends.
(b) At any time when such special voting power has vested in the
holders of the shares of this Series as described in Section (x)(1) above,
a proper officer of the Company will, upon the written request of the
holders of record of at least 10% of the shares of this Series then
outstanding addressed to the Secretary of the Company, call an
extraordinary meeting of the holders of such Series for the purpose of
electing directors. Such meeting will be held at the earliest practicable
date in such place as may be designated pursuant to the Articles of
Association (or if there be no designation, at the principal office of the
Company in Hamilton, Bermuda). If such meeting shall not be called by the
proper officers of the Company within 20 days after the Secretary of the
Company has been personally served with such request, or within 30 days
after mailing the same within the United States by registered or certified
mail addressed to the Secretary of the Company at its principal office,
then the holders of record of at least 10% of such class or series then
outstanding may designate in writing one of their number to call such
meeting at the Company's expense, and such meeting may be called by such
Person so designated upon the notice required for annual meetings of
shareholders and will be held in Hamilton, Bermuda. Any holder of the
shares of such class or series so designated will have access to the stock
books of the Company for the purpose of causing meetings of shareholders to
be called pursuant to these provisions. Notwithstanding the foregoing, no
such extraordinary meeting will be called during the period within 90 days
immediately preceding the date fixed for the next annual meeting of
shareholders.
(c) At any annual or extraordinary meeting at which the holders of any
class or series of Parity Securities have the special right, voting
separately as a class, to elect directors as described above, the presence,
in person or by proxy, of the holders of 33 1/3% of such class or series
will be required to constitute a quorum of such class or series for the
election of any director by the holders of such class or series, voting as
a class. At any such meeting or adjournment thereof, (1) the absence of a
quorum of such class or series, voting as a class, and the absence of a
quorum for the election of such other directors will not prevent the
election of the directors to be elected by such class or series, voting as
a class, and (2) in the absence of either or both such quorums, a majority
of the holders present in person or by proxy of any class or series of
shares for which a quorum is lacking will have power to adjourn the meeting
for the election of directors which they are entitled to elect, from time
to time until a quorum shall be present, without notice other than
announcement at the meeting.
(d) During any period in which the holders of any class or series of
Parity Securities have the right to vote as a class for directors as
described above, any vacancies in the Board of Directors will be filled
only by vote of a majority (even if that be only a single director) of the
remaining directors theretofore elected by the holders of such class or
series which elected the directors whose office shall have become vacant.
During such period the directors so elected by the holders of such class or
series will continue in office
9
(1) until the next succeeding annual meeting or until their successors, if
any, are elected by such holders and qualify or (2) unless required by
applicable law to continue in office for a longer period, until termination
of the right of the holders of such class or to vote as a class for
directors, if earlier. If and to the extent permitted by applicable law,
immediately upon any termination of the right of the holders of any class
or series of preferred shares to vote as a class for directors as provided
herein, the term of office of the directors then in office so elected by
the holders of such class or series will terminate.
(e) Whether or not the Company is being wound up, the rights attached
to any class or series of Parity Securities may only be varied with the
consent in writing of the holders of three-fourths of the issued shares of
that class or series, or with the sanction of a special resolution approved
by at least 66 2/3% of the votes cast by the holders of the shares of that
class or series at a duly convened meeting where at least one-third of the
issued shares of that class or series are represented, either in person or
by proxy. The rights attached to any class or series of Parity Securities
will not be deemed to be varied by the creation or issue of any shares or
any securities convertible into or evidencing the right to purchase shares
ranking prior to or equally with such class or series of the Parity
Securities with respect to the payment of dividends or of assets upon
liquidation, dissolution or winding up. Holders of the shares of this
Series are not entitled to vote on any amalgamation, consolidation, merger
or statutory share exchange, except to the extent that such a transaction
would vary the rights attached to any such class or series of Parity
Securities, in which case any such variation is subject to the approval
process described above. Holders of the shares of this Series are not
entitled to vote on any sale of all or substantially all of the assets of
the Company.
(f) On any item on which the holders of the shares of this Series are
entitled to vote, such holders will be entitled to one vote for each
preferred share held.
(xi) Miscellaneous. The number of authorized shares of this Series may be
increased or decreased (but not below the number of shares thereof then
outstanding) by the affirmative vote of the holders of a majority of the capital
stock of the Company entitled to vote.
(xii) No Preemptive Rights. The holders of shares of this Series shall
have no preemptive rights, including preemptive rights with respect to any
shares of capital stock or other securities of the Company convertible into or
carrying rights or options to purchase any such shares.
(xiii) Certain Definitions. As used in this certificate, the following
terms shall have the following respective meanings:
"Authorized Newspaper" means a daily newspaper, in the English language,
customarily published on each day that is a Business Day in The City of New
York, whether or not published on days that are legal holidays, and of general
circulation in The City of New York. The Authorized Newspaper for the purposes
of the Reset Spread Announcement Date, is currently anticipated to be The Wall
Street Journal (NYC edition).
10
"Business Day" means any day other than a Saturday, Sunday or any other day
on which banking institutions and trust companies in The City of New York are
permitted or required by any applicable law to close.
"Cash Settlement" has the meaning set forth in Section 5.4(a)(i) of the
Purchase Contract Agreement.
"Clearing Agency" means an organization registered as a "Clearing Agency"
pursuant to Section 17A of the Securities and Exchange Act of 1934, as
amended,that is acting as a depositary for the shares of this Series and in
whose name, or in the name of a nominee of that organization, shall be
registered a global certificate and which shall undertake to effect book-entry
transfers and pledges of the shares of this Series.
(1) "Clearing Agency Participant" means a broker, dealer, bank, other
financial institution or other Person for whom from time to time the Clearing
Agency effects book-entry transfers and pledges of securities deposited with the
Clearing Agency.
"Collateral Agent" means The Bank of New York, as Collateral Agent under
the Pledge Agreement until a successor Collateral Agent shall have become such
pursuant to the applicable provisions of the Pledge Agreement, and thereafter
"Collateral Agent" shall mean the Person who is then the Collateral Agent
thereunder.
"Company" means the Person named as the "Company" in the first paragraph of
this instrument.
"Contract Adjustment Payments" has the meaning set forth in the Purchase
Contract Agreement.
"Dividend Payment Date" has the meaning set forth in Section (iii)(c).
"DTC" means The Depository Trust Company, the initial Clearing Agency.
"Failed Remarketing" has the meaning set forth in Section 5.4(b) of the
Purchase Contract Agreement.
"Growth PRIDES" means the collective rights and obligations of a holder of
a Growth PRIDES certificate in respect of a 1/20th undivided beneficial interest
in a treasury security, subject in each case to the pledge thereof under the
Pledge Agreement, and the related Purchase Contract.
"Income PRIDES" means the collective rights and obligations of a holder of
an Income PRIDES certificate in respect of a Preferred Share, subject to the
pledge thereof under the Pledge Agreement, and the related Purchase Contract.
"Junior Securities" has the meaning set forth in Section (ii).
11
"One-Month Treasury Bill" means direct obligations of the United States
(which may be obligations traded on a when-issued basis only) having a maturity
comparable to the remaining term to maturity of the Preferred Shares, as agreed
upon by the Company and the Reset Agent. The rate for the One-Month Treasury
Bill will be the bid side rate displayed at 10:00 A.M., New York City time, on
the third Business Day immediately preceding the May ___, 2003 in the Telerate
system (or if the Telerate system is (a) no longer available on the third
Business Day immediately preceding May ___, 2003 or (b) in the opinion of the
Reset Agent (after consultation with the Company) no longer an appropriate
system from which to obtain such rate, such other nationally recognized
quotation system as, in the opinion of the Reset Agent (after consultation with
the Sponsor) is appropriate. If such rate is not so displayed, the rate for the
One-Month Treasury Bill shall be, as calculated by the Reset Agent, the yield to
maturity for the One-Month Treasury Bill, expressed as a bond equivalent on the
basis of a year of 365 or 366 days, as applicable, and applied on a daily basis,
and computed by taking the arithmetic mean of the secondary market bid rates, as
of 10:30 A.M., New York City time, on the third Business Day immediately
preceding May ___, 2003, of three leading United States government securities
dealers selected by the Reset Agent (after consultation with the Company) (which
may include the Reset Agent or an affiliate thereof).
"Ordinary Shares" has the meaning set forth in Section (ii).
"Parity Securities " has the meaning set forth in Section (ii).
"Person" means any individual, corporation, limited liability company,
partnership, joint venture, association, joint-stock company, trust,
unincorporated organization or government or any agency or political subdivision
thereof.
"Pledge Agreement" means the Pledge Agreement, dated as of the date hereof,
by and among the Company, the Collateral Agent and the Agent, on its own behalf
and as attorney-in-fact for the Holders from time to time of the Securities.
"Preferred Shares" has the meaning set forth in the preamble.
"Purchase Contract," when used with respect to any Income PRIDES or Growth
PRIDES, means the contract forming a part of such security and obligating the
Company to (i) sell and the holder of such Security to purchase Ordinary Shares
and (ii) pay the holder Contract Adjustment Payments with respect to the related
Income PRIDES or Growth PRIDES on the terms and subject to the conditions set
forth in Article Five of the Purchase Contract Agreement.
"Purchase Contract Agent" means The Bank of New York.
"Purchase Contract Agreement" means the agreement between the Company and
the Purchase Contract Agent, dated April ___, 2000.
"Put Option" has the meaning set forth in Section (v).
"Put Option Exercise Price" has the meaning set forth in Section (v).
12
"Put Option Repayment Price" has the meaning set forth in Section (v).
"Redemption Date" has the meaning set forth in Section (iv).
"Redemption Price" has the meaning set forth in Section (iv).
"Remarketing Agent" means a nationally recognized investment banking firm
chosen by the Company to remarket the Preferred Shares. It is currently
anticipated that Merrill Lynch, Pierce, Fenner & Smith Incorporated will act in
such capacity
"Remarketing Agreement" means the Remarketing Agreement dated April ,
2000 by and among the Company, the Remarketing Agent and the Purchase Contract
Agent.
"Remarketing Underwriting Agreement" has the meaning specified in the
Remarketing Agreement.
"Reset Agent" means a nationally recognized investment banking firm chosen
by the Company to determine the Reset Rate. It is currently anticipated that
Merrill Lynch, Pierce, Fenner & Smith Incorporated will act in such capacity.
"Reset Announcement Date" means the tenth (10th) Business Day immediately
preceding May ___, 2003.
"Reset Rate" means the dividend rate per annum (to be determined by the
Reset Agent), equal to the sum of (X) the Reset Spread and (Y) the rate of
interest on the One-Month Treasury Bill in effect on the third Business Day
immediately preceding May __, 2003, that the Preferred Shares should bear in
order for the Preferred Shares to have an approximate market value of 100.5% of
their aggregate liquidation amount on the third Business Day immediately
preceding May ___, 2003; provided, that the Company may limit such Reset Spread
to be no higher than basis points ( %); and provided, further, that in
the event of a Failed Remarketing, the Reset Rate shall be the dividend rate per
annum in effect on the Business Day immediately preceding May ___, 2003.
"Reset Spread" means a spread amount to be determined by the Reset Agent on
the tenth (10th) Business Day immediately preceding May ___, 2003.
"Senior Securities" has the meaning set forth in Section (ii).
"Series" has the meaning set forth in the preamble.
"Separate Preferred Shares" has the meaning set forth in Section (iv)(b).
"Trading Day" has the meaning specified in Section 5.1 of the Purchase
Contract Agreement.
"Transfer Agent" means The Bank of New York.
13
IN WITNESS WHEREOF, the Company has caused this Certificate to be duly
executed on its behalf by its undersigned ________ and attested to by its
_____________ this ___ day of April, 2000.
______________________________
Name:
Title:
ATTEST:
_____________________________
Name:
Title:
14