Exhibit 10.2

LOGO [g215203ex10_2logo.jpg]

  Opening Transaction

 

To:   

MF Global Holdings Ltd.

717 Fifth Avenue

9th Floor

New York, New York 10022

From:   

JPMorgan Chase Bank, National Association

P.O. Box 161

60 Victoria Embankment

London EC4Y 0JP

England

Re:    Base Convertible Bond Hedge Transaction Date:    July 28, 2011

 

 

Ladies and Gentlemen:

The purpose of this communication (this “Confirmation”) is to set forth the
terms and conditions of the above-referenced transaction entered into on the
Trade Date specified below (the “Transaction”) between JPMorgan Chase Bank,
National Association, London Branch (“Dealer”) and MF Global Holdings Ltd.
(“Counterparty”). This communication constitutes a “Confirmation” as referred to
in the ISDA Master Agreement specified below.

1.    This Confirmation is subject to, and incorporates, the definitions and
provisions of the 2006 ISDA Definitions (the “2006 Definitions”) and the
definitions and provisions of the 2002 ISDA Equity Derivatives Definitions (the
“Equity Definitions”, and together with the 2006 Definitions, the
“Definitions”), in each case as published by the International Swaps and
Derivatives Association, Inc. (“ISDA”). In the event of any inconsistency
between the 2006 Definitions and the Equity Definitions, the Equity Definitions
will govern. Certain defined terms used herein have the meanings assigned to
them in the Indenture dated as of February 11, 2011, between Counterparty and
Deustche Bank Trust Company Americas, as trustee (the “Base Indenture”), as
amended and supplemented by a Supplemental Indenture to be dated as of August 2,
2011 (the “Supplemental Indenture” and, together with the Base Indenture, the
“Indenture”), relating to the USD 325,000,000 principal amount of 3.375%
Convertible Senior Notes due 2018 (the “Convertible Securities”). In the event
of any inconsistency between the terms defined in the Indenture and this
Confirmation, this Confirmation shall govern. For the avoidance of doubt,
references herein to sections of the Supplemental Indenture and to the
definitions in the Indenture are based on the Base Indenture, as executed on
February 11, 2011, and a draft of the Supplemental Indenture most recently
reviewed by the parties at the time of execution of this Confirmation. If any
relevant sections of the Supplemental Indenture or to the definitions in the
Indenture are changed, added or renumbered between the execution of this
Confirmation and the execution of the Supplemental Indenture, the parties will
amend this Confirmation to preserve the economic intent of the parties, as
evidenced by the Base Indenture and drafts of the Supplemental Indenture. The
parties further acknowledge that references to the Indenture herein are
references to the Indenture as in effect on the date of its execution and if the
Indenture is amended, modified or supplemented following its execution, any such
amendment, modification or supplement will be disregarded for purposes of this
Confirmation (other than Section 8(b)(ii) below) unless

 

JPMorgan Chase Bank, National Association

Organised under the laws of the United States as a National Banking Association

Main Office 1111 Polaris Parkway, Columbus, Ohio 43271

Registered as a branch in England & Wales branch No. BR000746

Registered Branch Office 125 London Wall, London EC2Y 5AJ

Authorised and regulated by the Financial Services Authority

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the parties agree otherwise in writing. The Transaction is subject to early
unwind if the closing of the Convertible Securities is not consummated for any
reason, as set forth below in Section 8(k).

Each party is hereby advised, and each such party acknowledges, that the other
party has engaged in, or refrained from engaging in, substantial financial
transactions and has taken other material actions in reliance upon the parties’
entry into the Transaction to which this Confirmation relates on the terms and
conditions set forth below.

This Confirmation evidences a complete and binding agreement between Dealer and
Counterparty as to the terms of the Transaction to which this Confirmation
relates. This Confirmation shall be subject to an agreement (the “Agreement”) in
the form of the 1992 ISDA Master Agreement (Multicurrency—Cross Border) as if
Dealer and Counterparty had executed an agreement in such form on the date
hereof (but without any Schedule except for (i) the election of Loss and Second
Method and US Dollars (“USD”) as the Termination Currency, and (ii) the
replacement of the word “third” in the last line of Section 5(a)(i) of the
Agreement with the word “first”. In addition, Section 5(a)(i) of the Agreement
shall be amended by adding at the end of such section the following:
“Notwithstanding the foregoing, a default under this Section 5(a)(i) shall not
constitute an Event of Default if (x) the default was caused solely by error or
omission of an administrative or operational nature; (y) funds were available to
enable the party to make the payment when due and (z) the payment is made within
two Local Business Days of such party’s receipt of written notice of its failure
to pay;”.

All provisions contained in, or incorporated by reference to, the Agreement will
govern this Confirmation except as expressly modified herein. In the event of
any inconsistency between this Confirmation and either the Definitions or the
Agreement, this Confirmation shall govern.

The Transaction hereunder shall be the sole Transaction under the Agreement. If
there exists any ISDA Master Agreement between Dealer and Counterparty or any
confirmation or other agreement between Dealer and Counterparty pursuant to
which an ISDA Master Agreement is deemed to exist between Dealer and
Counterparty, then notwithstanding anything to the contrary in such ISDA Master
Agreement, such confirmation or agreement or any other agreement to which Dealer
and Counterparty are parties, the Transaction shall not be considered a
Transaction under, or otherwise governed by, such existing or deemed ISDA Master
Agreement.

The Transaction is entered into as part of an integrated transaction with the
Convertible Securities, pursuant to Treasury Regulations Section 1.1275-6.

2.    The Transaction constitutes a Share Option Transaction for purposes of the
Equity Definitions. The terms of the particular Transaction to which this
Confirmation relates are as follows:

General Terms:

 

Trade Date:

 

July 28, 2011

Effective Date:

 

The closing date of the initial issuance of the Convertible Securities.

Option Style:

 

Modified American, as described under “Procedures for Exercise” below.

Option Type:

 

Call

Seller:

 

Dealer

Buyer:

 

Counterparty

Shares:

 

The Common Stock of Counterparty, par value USD1.00 (Ticker Symbol: “MF”).

Number of Options:

 

The number of Convertible Securities in denominations of USD1,000 principal
amount issued

 

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by Counterparty on the closing date for the initial issuance of the Convertible
Securities. For the avoidance of doubt, the Number of Options outstanding shall
be reduced by each exercise of Options hereunder.

Option Entitlement:

 

As of any date, a number of Shares per Option equal to the “Conversion Rate” (as
defined in the Indenture, but without regard to any adjustments to the
Conversion Rate pursuant to a Fundamental Change Adjustment or a Discretionary
Adjustment).

Applicable Percentage:

 

30%

Fundamental Change Adjustment:

 

Any adjustment to the Conversion Rate pursuant to Section 4.06 of the
Supplemental Indenture.

Discretionary Adjustment:

 

Any adjustment to the Conversion Rate pursuant to Section 4.05 of the
Supplemental Indenture.

Strike Price:

 

As of any date, an amount in USD, rounded to the nearest cent (with 0.5 cents
being rounded upwards), equal to USD1,000 divided by the Option Entitlement as
of such date.

Number of Shares:

 

The product of (i) the Applicable Percentage, (ii) the Number of Options and
(iii) the Option Entitlement.

Premium:

 

USD $25,720,500.

Premium Payment Date:

 

The Effective Date

Exchange:

 

New York Stock Exchange

Related Exchange:

 

All Exchanges

Procedures for Exercise:  

Exercise Dates:

 

Each Conversion Date.

Conversion Date:

 

Each “Conversion Date” (as defined in the Indenture) occurring during the
Exercise Period for Convertible Securities each in denominations of USD1,000
principal amount (such Convertible Securities, the “Relevant Convertible
Securities” for such Conversion Date).

Exercise Period:

 

The period from and excluding the Effective Date to and including the Expiration
Date.

Expiration Date:

 

The earlier of (i) the last day on which any Convertible Securities remain
outstanding and (ii) the second “Scheduled Trading Day” (as defined in the
Indenture) immediately preceding the “Maturity Date” (as defined in the
Indenture).

Automatic Exercise on

Conversion Dates:

 

 

Applicable; and means that on each Conversion Date, a number of Options equal to
the number of Relevant Convertible Securities for such Conversion Date in
denominations of USD1,000 principal amount shall be automatically exercised,
subject to “Notice of Exercise” below.

 

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Notice Deadline:

 

In respect of any exercise of Options hereunder on any Conversion Date, 12:00
P.M., New York City time, on the Scheduled Trading Day immediately preceding the
scheduled first “VWAP Trading Day” (as defined in the Indenture) of the relevant
“Cash Settlement Averaging Period” (as defined in the Indenture); provided that
in the case of any exercise of Options hereunder in connection with the
conversion of any Relevant Convertible Securities for any Conversion Date
occurring during the period beginning on, and including, the 65th “Scheduled
Trading Day” (as defined in the Indenture) immediately preceding the “Maturity
Date” (as defined in the Indenture) and ending on, and including, the Expiration
Date (such period, the “Final Conversion Period”), the Notice Deadline shall be
12:00 P.M., New York City time, on the “Scheduled Trading Day” (as defined in
the Indenture) immediately preceding the Expiration Date.

Notice of Exercise:

 

Notwithstanding anything to the contrary in the Equity Definitions, Dealer shall
have no obligation to make any payment or delivery in respect of any exercise of
Options hereunder and such obligation in respect of such exercise shall be
permanently extinguished unless Counterparty notifies Dealer in writing prior to
12:00 P.M., New York City time, on the Notice Deadline in respect of such
exercise, of (i) the number of Relevant Convertible Securities being converted
on the related Conversion Date, (ii) the scheduled settlement date under the
Indenture for the Relevant Convertible Securities for such Conversion Date,
(iii) the “Cash Percentage” (as defined in the Indenture) (provided that, if no
“Cash Percentage” (as defined in the Indenture) is specified in a Notice of
Exercise, such Notice of Exercise shall nonetheless be valid and that in the
event of the failure of Counterparty to specify the “Cash Percentage” (as
defined in the Indenture) as required in this clause (iii), such “Cash
Percentage” shall be deemed, for purposes of determining Dealer’s delivery
obligation hereunder, to be 0%) and (iv) the scheduled first “VWAP Trading Day”
(as defined in the Indenture) of the relevant “Cash Settlement Averaging Period”
(as defined in the Indenture); provided that in the case of any exercise of
Options in connection with the conversion of any Relevant Convertible Securities
for any Conversion Date occurring during the Final Conversion Period, the
contents of such notice need only include the information as set forth in
clauses (i) and (iii) above; provided, further, that, notwithstanding the
foregoing, such notice (and the related exercise of Options) shall be effective
if given after 12:00 P.M., New York City time, on the Notice Deadline but

 

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prior to 5:00 P.M., New York City time, on the fifth Exchange Business Day
following the Notice Deadline, in which event the Calculation Agent shall have
the right to adjust the Delivery Obligation as appropriate to reflect the
additional costs (including, but not limited to, hedging mismatches and market
losses) and expenses incurred by Dealer or any of its affiliates in connection
with its hedging activities (including the unwinding of any hedge position) as a
result of its not having received such notice prior to the Notice Deadline.
Counterparty acknowledges its responsibilities under applicable securities laws,
and in particular Section 9 and Section 10(b) of the Exchange Act (as defined
below) and the rules and regulations thereunder, in respect of any election of a
settlement method with respect to the Convertible Securities. For the avoidance
of doubt, if Counterparty fails to give such notice when due in respect of any
exercise of Options hereunder, Dealer’s obligation to make any payment or
delivery in respect of such exercise shall be permanently extinguished, and late
notice shall not cure such failure except as provided in the second proviso
hereof.

Dealer’s Telephone Number

and Telex and/or Facsimile Number

and Contact Details for purpose of

Giving Notice:

 

As specified in Section 6(b) below.

Settlement Terms:  

Settlement Date:

 

For any Exercise Date, the settlement date for the cash and Shares (if any) to
be delivered in respect of the Relevant Convertible Securities for the relevant
Conversion Date under the terms of the Indenture; provided that the Settlement
Date shall not occur prior to the latest of (i) the date one Settlement Cycle
following the final “VWAP Trading Day” (as defined in the Indenture) of the
relevant “Cash Settlement Averaging Period” (as defined in the Indenture), (ii)
the Exchange Business Day immediately following the date on which Counterparty
gives notice to Dealer of such Settlement Date prior to 12:00 P.M., New York
City time, or (iii) the Exchange Business Day immediately following the date on
which Counterparty provides the Notice of Delivery Obligation (as described
below) prior to 12:00 P.M., New York City time.

Delivery Obligation:

 

In lieu of the obligations set forth in Sections 8.1 and 9.1 of the Equity
Definitions, and subject to “Notice of Exercise” above, in respect of any
Exercise Date, Dealer will deliver to Counterparty on the related Settlement
Date (the “Delivery Obligation”), a number of Shares and/or amount of cash equal
to the

 

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aggregate number of Shares and/or amount of cash that Counterparty would be
obligated to deliver to the holder(s) of the Relevant Convertible Securities for
the related Conversion Date pursuant to Section 4.03(a)(2) of the Supplemental
Indenture (reflecting the Applicable Percentage) for each of the “VWAP Trading
Days” (as defined in the Indenture) in the relevant “Cash Settlement Averaging
Period” (as defined in the Indenture), and representing an aggregate number of
Shares and/or amount of cash, with respect to each such “VWAP Trading Day” (as
defined in the Indenture) equal to:

 

(i) if the “Cash Percentage” (as defined in the Indenture) is not specified in
the Notice of Exercise or is equal to 0%, a number of Shares, if any, equal to
the product of (a) the Applicable Percentage and (b) the “Maximum Daily
Deliverable Shares” (as defined in the Indenture), if any, with respect to such
“VWAP Trading Day” (as defined in the Indenture), with such number of Shares
rounded down to the nearest whole number;

 

(ii) if the “Cash Percentage” (as defined in the Indenture) specified in the
Notice of Exercise is equal to 100%, an amount in cash, if any, in USD, equal to
the product of (a) the Applicable Percentage and (b) the aggregate amount of
cash, if any, in excess of the “Daily Cash Amount” (as defined in the Indenture)
per Relevant Convertible Security that Counterparty would be obligated to
deliver in lieu of the “Maximum Daily Deliverable Shares” (as defined in the
Indenture) with respect to such “VWAP Trading Day” (as defined in the
Indenture); or

 

(iii) if the “Cash Percentage” (as defined in the Indenture) specified in the
Notice of Exercise is less than 100% but greater than 0%, (a) a number of
Shares, if any, equal to the product of (x) the Applicable Percentage, (y) the
“Maximum Daily Deliverable Shares” (as defined in the Indenture), if any, with
respect to such “VWAP Trading Day” (as defined in the Indenture) and (z) 100%
minus the “Cash Percentage” (as defined in the Indenture) specified in such
Notice of Exercise, with such number of Shares rounded down to the nearest whole
number, and (b) an amount of cash, if any, in USD, equal to the product of (x)
the Applicable Percentage and (y) the aggregate amount of cash, if any, in
excess of the “Daily Cash Amount” (as defined in the Indenture) per Relevant
Convertible Security that Counterparty would be obligated to deliver in lieu of
the “Maximum Daily Deliverable Shares” (as defined in the Indenture) with
respect to such “VWAP Trading Day” (as defined in the Indenture) if the “Cash
Percentage” (as defined in the Indenture) were

 

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equal to 0% and (z) the “Cash Percentage” (as defined in the Indenture)
specified in such Notice of Exercise; and

 

(iv) an amount of cash, if any, in USD, in lieu of any fractional Shares
resulting from rounding down such aggregate number of Shares valued at the
“Daily VWAP” (as defined in the Indenture) on the last “VWAP Trading Day” (as
defined in the Indenture) of the relevant “Cash Settlement Averaging Period” (as
defined in the Indenture) (collectively, the “Convertible Obligation”);
provided, that the Delivery Obligation shall be determined excluding any Shares
and/or cash that Counterparty is obligated to deliver to holder(s) of the
Relevant Convertible Securities as a result of any adjustments to the Conversion
Rate pursuant to a Fundamental Change Adjustment or a Discretionary Adjustment
and any interest payment that Counterparty is (or would have been) obligated to
deliver to holder(s) of the Relevant Convertible Securities for such Conversion
Date; provided, further, that if such exercise relates to the conversion of
Relevant Convertible Securities in connection with which holder(s) thereof are
entitled to receive additional Shares and/or cash pursuant to a Fundamental
Change Adjustment, then, notwithstanding the foregoing, the number of “Maximum
Daily Deliverable Shares” (as defined in the Indenture) used to calculate the
portion of the Delivery Obligation corresponding to any “VWAP Trading Day” (as
defined in the Indenture) in the relevant “Cash Settlement Averaging Period” (as
defined in the Indenture) for the Relevant Convertible Securities shall include
any “Additional Shares” (as defined in the Indenture) added to the “Conversion
Rate” (as defined in the Indenture) pursuant to the Fundamental Change
Adjustment, except that the Delivery Obligation shall be capped so that the
value of the Delivery Obligation per Option (with the value of any Shares
included in the Delivery Obligation determined by the Calculation Agent using
the “Daily VWAP” (as defined in the Indenture) on the last “VWAP Trading Day”
(as defined in the Indenture) of the relevant “Cash Settlement Averaging Period”
(as defined in the Indenture)) does not exceed the amount as determined by the
Calculation Agent that would be payable by Dealer pursuant to Section 6 of the
Agreement if such Conversion Date were an Early Termination Date resulting from
an Additional Termination Event with respect to which the Transaction was the
sole Affected Transaction and Counterparty was the sole Affected Party
(determined without regard to Section 8(c) of this Confirmation) (except that,
for purposes of determining such amount, (x) the Number of Options shall be
deemed to be equal to the number of Options

 

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exercised on such Exercise Date and (y) such amount payable will be determined
as if the Fundamental Change Adjustment provisions were deleted from the
Indenture). For the avoidance of doubt, if the “Daily Conversion Value” (as
defined in the Indenture) for any “VWAP Trading Day” (as defined in the
Indenture) occurring in the relevant “Cash Settlement Averaging Period” (as
defined in the Indenture) is less than or equal the “Daily Cash Amount” (as
defined in the Indenture) Dealer will have no delivery obligation hereunder in
respect of the related Exercise Date for such “VWAP Trading Day” (as defined in
the Indenture).

Notice of Delivery Obligation:

 

No later than the Exchange Business Day immediately following the last “VWAP
Trading Day” (as defined in the Indenture) of the relevant “Cash Settlement
Averaging Period” (as defined in the Indenture), Counterparty shall give Dealer
notice of the final number of Shares and/or amount of cash comprising the
relevant Convertible Obligation; provided that, with respect to any Exercise
Date occurring during the Final Conversion Period, Counterparty may provide
Dealer with a single notice of the aggregate number of Shares and/or amount of
cash comprising the Convertible Obligations for all Exercise Dates occurring
during such period (it being understood, for the avoidance of doubt, that the
requirement of Counterparty to deliver such notice shall not limit
Counterparty’s obligations with respect to Notice of Exercise as set forth
above, in any way).

Other Applicable Provisions:

 

To the extent Dealer is obligated to deliver Shares hereunder, the provisions of
Sections 9.8, 9.9, 9.10, 9.11 and 9.12 of the Equity Definitions will be
applicable as if “Physical Settlement” applied to the Transaction; provided that
the Representation and Agreement contained in Section 9.11 of the Equity
Definitions shall be modified by excluding any representations therein relating
to restrictions, obligations, limitations or requirements under applicable
securities laws that exist as a result of the fact that Counterparty is the
issuer of the Shares.

Restricted Certificated Shares:

 

Notwithstanding anything to the contrary in the Equity Definitions, Dealer may,
in whole or in part, deliver Shares required to be delivered to Counterparty
hereunder in certificated form in lieu of delivery through the Clearance System.
With respect to such certificated Shares, the Representation and Agreement
contained in Section 9.11 of the Equity Definitions shall be modified by
deleting the remainder of the provision after the word “encumbrance” in the
fourth line thereof.

Adjustments:  

 

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Method of Adjustment:

 

Notwithstanding Section 11.2 of the Equity Definitions, upon the occurrence of
any event or condition set forth in Sections 4.04(a), (b), (c), (d) or (e) of
the Supplemental Indenture, the Calculation Agent shall make a corresponding
adjustment to the terms relevant to the exercise, settlement or payment of the
Transaction. Promptly following the occurrence of any “Adjustment Event” (as
defined in the Indenture), Counterparty shall notify the Calculation Agent of
such Adjustment Event; and once the adjustments to be made to the terms of the
Indenture and the Convertible Securities in respect of such Adjustment Event
have been determined, Counterparty shall promptly notify the Calculation Agent
in writing of the details of such adjustments.

Extraordinary Events:  

Merger Events:

 

Notwithstanding Section 12.1(b) of the Equity Definitions, a “Merger Event”
means the occurrence of any event or condition set forth in Section 4.07(a) of
the Supplemental Indenture.

Consequences of Merger Events:

 

Notwithstanding Section 12.2 of the Equity Definitions, upon the occurrence of a
Merger Event, the Calculation Agent shall make a corresponding adjustment to the
terms relevant to the exercise, settlement or payment of the Transaction;
provided that such adjustment shall be made without regard to any adjustment to
the Conversion Rate pursuant to a Fundamental Change Adjustment or a
Discretionary Adjustment; and provided further that the Calculation Agent shall
limit or alter any such adjustment referenced in this paragraph so that the fair
value of the Transaction to Dealer immediately prior to the occurrence of such
Merger Event is not reduced as a result of such adjustment; and provided further
that if, with respect to a Merger Event, the consideration for the Shares
includes (or, at the option of a holder of Shares, may include) shares of an
entity or person not organized under the laws of the United States, any state
thereof or the District of Columbia, the Calculation Agent may make adjustments
to the Transaction, or request that Counterparty make Dealer whole, for any
additional costs resulting from such Merger Event with respect to incremental
Tax costs reasonably incurred by Dealer or changes to the Hedge Positions
maintained by Dealer.

Notice of Merger Consideration and

Consequences:

 

 

Upon the occurrence of a Merger Event that causes the Shares to be converted
into the right to receive more than a single type of consideration (determined
based in part upon any form of stockholder election), Counterparty shall
reasonably promptly (but in any event prior to the relevant Merger Date) notify
the Calculation Agent of (i) the type and amount of

 

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consideration that a holder of Shares would have been entitled to in the case of
reclassifications, consolidations, mergers, sales or transfers of assets or
other transactions that cause Shares to be converted into the right to receive
more than a single type of consideration, (ii) the weighted average of the types
and amounts of consideration to be received by the holders of Shares that
affirmatively make such an election (or if no holders of Shares affirmatively
make such an election, the types and amount of consideration actually received
by such holders), and (iii) the details of the adjustment to be made under the
Indenture in respect of such Merger Event.

Nationalization, Insolvency

or Delisting:

 

 

Cancellation and Payment (Calculation Agent Determination); provided that in
addition to the provisions of Section 12.6(a)(iii) of the Equity Definitions, it
will also constitute a Delisting if the Exchange is located in the United States
and the Shares are not immediately re-listed, re-traded or re-quoted on any of
the New York Stock Exchange, The NASDAQ Global Select Market or The NASDAQ
Global Market (or their respective successors); if the Shares are immediately
re-listed, re-traded or re-quoted on any such exchange or quotation system, such
exchange or quotation system shall thereafter be deemed to be the Exchange.

Additional Termination Event(s):

 

Notwithstanding anything to the contrary in the Equity Definitions, if, as a
result of an Extraordinary Event, any Transaction would be cancelled or
terminated (whether in whole or in part) pursuant to Article 12 of the Equity
Definitions, an Additional Termination Event (with such terminated
Transaction(s) (or portions thereof) being the Affected Transaction(s) and
Counterparty being the sole Affected Party) shall be deemed to occur, and, in
lieu of Sections 12.7, 12.8 and 12.9 of the Equity Definitions, Section 6 of the
Agreement shall apply to such Affected Transaction(s).

Additional Disruption Events:

 

  (a)  Change in Law:

 

Applicable; provided that (A) any determination as to whether (i) the adoption
of or any change in any applicable law or regulation (including, without
limitation, any tax law) or (ii) the promulgation of or any change in or public
announcement of the formal or informal interpretation by any court, tribunal or
regulatory authority with competent jurisdiction of any applicable law or
regulation (including any action taken by a taxing authority), in each case,
constitutes a “Change in Law” shall be made without regard to Section 739 of the
Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 or any similar
legal certainty provision in any legislation

 

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  enacted, or rule or regulation promulgated, on or after the Trade Date and (B)
Section 12.9(a)(ii) of the Equity Definitions is hereby amended by (w) adding
the words “(including, for the avoidance of doubt and without limitation,
adoption or promulgation of new regulations authorized or mandated by existing
statute)” after the word “regulation” in the second line thereof, (x) adding the
words “or any Hedge Positions” after the word “Shares” in the clause (X)
thereof, (y) adding the words “, or holding, acquiring or disposing of Shares or
any Hedge Positions relating,” after the word “obligations” in clause (Y)
thereof and (z) inserting at the end thereof the words “after using commercially
reasonable efforts to avoid such increased cost based on prevailing
circumstances applicable to it”.

  (b)  Failure to Deliver:

  Applicable

  (c)  Insolvency Filing:

  Applicable

  (d)  Hedging Disruption:

  Applicable

  (e)  Increased Cost of Hedging:

  Applicable

Hedging Party:

  Dealer

Determining Party:

  Dealer

Non-Reliance:

  Applicable

Agreements and Acknowledgments

Regarding Hedging Activities:

    Applicable

Additional Acknowledgments:

  Applicable

3.    Calculation Agent:

  Dealer. All calculations and determinations by the Calculation Agent shall be
made in good faith and in a commercially reasonable manner. The Calculation
Agent shall deliver, within five Exchange Business Days of a written request by
Counterparty, a written explanation describing in reasonable detail any
calculation, adjustment or determination made by it (including the methodology,
interest rates, quotations, market data (including volatility) and information
from internal sources used in making such calculation, adjustment or
determination, but without disclosing any proprietary models or other
information that Dealer is not permitted to disclose to Counterparty,
notwithstanding Counterparty’s agreement to keep such information confidential,
under applicable law, rule, regulation or agreement with third party.

4.    Account Details:

 

    Dealer Payment Instructions:

 

 

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      Account for delivery of shares to JPMorgan:

  Counterparty Payment Instructions:

 

  Bank:        ABA#:        FBO:        Account #:        Swift:     

 

5.    Offices:

    The Office of Dealer for the Transaction is:

      JPMorgan Chase Bank, National Association

      London Branch

      P.O. Box 161

      60 Victoria Embankment

      London EC4Y 0JP

      England

    The Office of Counterparty for the Transaction is:

    Inapplicable; Counterparty is not a Multibranch Party.

 

6.    Notices: For purposes of this Confirmation:

(a)        Address for notices or communications to Counterparty:

 

 To:      MF Global Holdings Ltd.   Attn:      David Dunne      Treasurer     
717 Fifth Avenue, 9th Floor      New York, New York 10022   Telephone:     
212-589-6327   Fax:      212-589-6215   Email:      ddunne@mfglobal.com
 With a copy to:        To:      MF Global Holdings Ltd.   Attn:      Joe Patt
     Principal Strategies      717 Fifth Avenue, 9th Floor      New York, New
York 10022   Telephone:      212-589-6267   Fax:      212-935-4606   Email:     
jpatt@mfglobal.com   To:      MF Global Holdings Ltd.   Attn:      Joe Lesar
     Global Head of Bank Relations      717 Fifth Avenue, 9th Floor

 

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     New York, New York 10022    Telephone:      212-589-6514    Fax:     
212-589-6215    Email:      jlesar@mfglobal.com

 

(b)        Address for notices or communications to Dealer:

 

   To:       JPMorgan Chase Bank, National Association       4 New York Plaza,
Floor 18       New York, NY 10004-2413    Attention:       EDG Marketing Support
   Email:       EDG_OTC_HEDGING_MS@jpmorgan.com    Fax:       1-866-886-4506
   with a copy to:       Karin E. Ross       J.P. Morgan Securities LLC     
 383 Madison Avenue, 28th Floor       New York, NY 10179    Phone:       (212)
622-5689    Facsimile:       (917) 464-3165    E-mail:     
 karin.e.ross@jpmchase.com

 

7.    Representations, Warranties and Agreements:

 

(a)        In addition to the representations and warranties in the Agreement
and those contained elsewhere herein, Counterparty represents and warrants to
and for the benefit of, and agrees with, Dealer as follows:

(i)        On the Trade Date and as of the date of any election by Counterparty
of the Share Termination Alternative  under (and as defined in) Section 8(c)
below, (A) Counterparty is not aware of any material nonpublic information
regarding  Counterparty or the Shares and (B) all reports and other documents
filed by Counterparty with the Securities and Exchange  Commission pursuant to
the Securities Exchange Act of 1934, as amended (the “Exchange Act”) when
considered as a whole  (with the more recent such reports and documents deemed
to amend inconsistent statements contained in any earlier such  reports and
documents), do not contain any untrue statement of a material fact or any
omission of a material fact required to be  stated therein or necessary to make
the statements therein, in the light of the circumstances in which they were
made, not  misleading.

(ii)      Without limiting the generality of Section 13.1 of the Equity
Definitions, Counterparty acknowledges that  neither Dealer nor any of its
affiliates is making any representations or warranties or taking any position or
expressing any  view with respect to the treatment of the Transaction under any
accounting standards including ASC Topic 260, Earnings Per  Share, ASC Topic
815, Derivatives and Hedging, or ASC Topic 480, Distinguishing Liabilities from
Equity and ASC 815-40,  Derivatives and Hedging – Contracts in Entity’s Own
Equity (or any successor issue statements).

(iii)      Without limiting the generality of Section 3(a)(iii) of the
Agreement, the Transaction will not violate Rule  13e-1 or Rule 13e-4 under the
Exchange Act.

(iv)      Prior to the Trade Date, Counterparty shall deliver to Dealer a
resolution of Counterparty’s board of directors  authorizing the Transaction and
such other certificate or certificates as Dealer shall reasonably request.

(v)       Counterparty is not entering into this Confirmation to create actual
or apparent trading activity in the Shares (or  any security convertible into or
exchangeable for Shares) or to

 

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raise or depress or otherwise manipulate the price of the Shares (or any
security convertible into or exchangeable for Shares) or otherwise in violation
of the Exchange Act.

(vi)       Counterparty is not, and after giving effect to the transactions
contemplated hereby will not be, required to register as, an “investment
company” as such term is defined in the Investment Company Act of 1940, as
amended.

(vii)      On each of the Trade Date and the Premium Payment Date, Counterparty
is not “insolvent” (as such term is defined under Section 101(32) of the U.S.
Bankruptcy Code (Title 11 of the United States Code) (the “Bankruptcy Code”))
and Counterparty would be able to purchase the Number of Shares in compliance
with the laws of the jurisdiction of Counterparty’s incorporation.

(viii)     No state, local or foreign law, rule, regulation or regulatory order
applicable to the Shares would give rise to any reporting, consent, registration
or other requirement (including without limitation a requirement to obtain prior
approval from any person or entity) as a result of Dealer or its affiliates
owning or holding (however defined) Shares.

(ix)        The representations and warranties of Counterparty set forth in
Section 3 of the Agreement and Section 1 of the Underwriting Agreement, dated as
of July 28, 2011, between Goldman, Sachs & Co. and Citigroup Global Markets
Inc., as representatives of the several Underwriters listed in Schedule A
thereto, and Counterparty (the “Underwriting Agreement”) are true and correct as
of the Trade Date and the Effective Date and are hereby deemed to be repeated to
Dealer as if set forth herein.

(b)        Each of Dealer and Counterparty agrees and represents that it is an
“eligible contract participant” as defined in Section 1a(12) of the U.S.
Commodity Exchange Act, as amended, and is entering into the Transaction as
principal (and not as agent or in any other capacity, fiduciary or otherwise)
and not for the benefit of any third party.

(c)        Each of Dealer and Counterparty acknowledges that the offer and sale
of the Transaction to it is intended to be exempt from registration under the
Securities Act of 1933, as amended (the “Securities Act”), by virtue of
Section 4(2) thereof. Accordingly, Counterparty represents and warrants to
Dealer that (i) it has the financial ability to bear the economic risk of its
investment in the Transaction and is able to bear a total loss of its investment
and its investments in and liabilities in respect of the Transaction, which it
understands are not readily marketable, are not disproportionate to its net
worth, and it is able to bear any loss in connection with the Transaction,
including the loss of its entire investment in the Transaction, (ii) it is an
“accredited investor” as that term is defined in Regulation D as promulgated
under the Securities Act, (iii) it is entering into the Transaction for its own
account and without a view to the distribution or resale thereof, (iv) the
assignment, transfer or other disposition of the Transaction has not been and
will not be registered under the Securities Act and is restricted under this
Confirmation, the Securities Act and state securities laws, and (v) its
financial condition is such that it has no need for liquidity with respect to
its investment in the Transaction and no need to dispose of any portion thereof
to satisfy any existing or contemplated undertaking or indebtedness and is
capable of assessing the merits of and understanding (on its own behalf or
through independent professional advice), and understands and accepts, the
terms, conditions and risks of the Transaction.

(d)        Each of Dealer and Counterparty agrees and acknowledges that Dealer
is a “financial institution,” “swap participant” and “financial participant”
within the meaning of Sections 101(22), 101(53C) and 101(22A) of the Bankruptcy
Code. The parties hereto further agree and acknowledge (A) that this
Confirmation is (i) a “securities contract,” as such term is defined in
Section 741(7) of the Bankruptcy Code, with respect to which each payment and
delivery hereunder or in connection herewith is a “termination value,” “payment
amount” or “other transfer obligation” within the meaning of Section 362 of the
Bankruptcy Code and a “settlement payment” within the meaning of Section 546 of
the Bankruptcy Code, and (ii) a “swap agreement,” as such term is defined in
Section 101(53B) of the Bankruptcy Code, with respect to which each payment and
delivery hereunder or in connection herewith is a “termination value,” “payment
amount” or “other transfer obligation” within the meaning of Section 362 of the
Bankruptcy Code and a “transfer” within the meaning of Section 546 of the
Bankruptcy Code, and (B) that

 

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Dealer is entitled to the protections afforded by, among other sections,
Sections 362(b)(6), 362(b)(17), 362(b)(27), 362(o), 546(e), 546(g), 546(j),
548(d)(2), 555, 560 and 561 of the Bankruptcy Code.

(e)        As a condition to the effectiveness of the Transaction, Counterparty
shall deliver to Dealer (i) an incumbency certificate, dated as of the Trade
Date, of Counterparty in customary form and (ii) an opinion of counsel, dated as
of the Trade Date, and reasonably acceptable to Dealer in form and substance,
with respect to with respect to matters set forth in clauses (i) through (iv) of
Section 3(a) of the Agreement as well as the execution and delivery of this
Confirmation, limited to the U.S. federal and New York state law and subject to
customary qualifications and exceptions.

(f)        Without limiting the generality of Section 13.1 of the Equity
Definitions, Counterparty understands that notwithstanding any other
relationship between Counterparty and Dealer and its affiliates, in connection
with this Transaction and any other over-the-counter derivative transaction
between Counterparty and Dealer and its affiliates, Dealer or its affiliate is
acting as principal and not a fiduciary or advisor in respect of any such
transaction, including any entry, exercise, amendment, unwind or termination
hereof or thereof.

(g)        Role of Agent. Each party agrees and acknowledges that (i) J.P.
Morgan Securities LLC, an affiliate of Dealer (“JPMS”), has acted solely as
agent and not as principal with respect to the Transaction and (ii) JPMS has no
obligation or liability, by way of guaranty, endorsement or otherwise, in any
manner in respect of the Transaction (including, if applicable, in respect of
the settlement thereof). Each party agrees it will look solely to the other
party (or any guarantor in respect thereof) for performance of such other
party’s obligations under the Transaction.

8.    Other Provisions:

(a)        Right to Extend.  Dealer may postpone any Exercise Date or Settlement
Date or any other date of valuation or delivery by Dealer, with respect to some
or all of the relevant Options (in which event the Calculation Agent shall make
appropriate adjustments to the Delivery Obligation), if Dealer determines, in
its reasonable discretion, that such extension is necessary or advisable to
preserve Dealer’s hedging or hedge unwind activity hereunder in light of
existing liquidity conditions in the cash market, the stock borrow market or
other relevant market or to enable Dealer to effect purchases of Shares or Share
Termination Delivery Units in connection with its hedging, hedge unwind or
settlement activity hereunder in a manner that would, based on advice of
counsel, if Dealer were Counterparty or an affiliated purchaser of Counterparty,
be in compliance with applicable legal, regulatory or self-regulatory
requirements, or with related policies and procedures applicable to Dealer.

(b)        Additional Termination Events.  The occurrence of (i) an event of
default with respect to Counterparty under the terms of the Convertible
Securities as set forth in Section 6.02 of the Supplemental Indenture that
results in an acceleration of the Convertible Securities pursuant to the terms
of the Indenture, or (ii) an Amendment Event shall constitute an Additional
Termination Event with respect to which the Transaction is the sole Affected
Transaction and Counterparty is the sole Affected Party, and Dealer shall be the
party entitled to designate an Early Termination Date pursuant to Section 6(b)
of the Agreement and to determine the amount payable pursuant to Section 6(e) of
the Agreement.

“Amendment Event” means that Counterparty amends, modifies, supplements or
obtains a waiver in respect of any term of the Indenture or the Convertible
Securities governing the principal amount, maturity, number of shares issuable
upon conversion, any term relating to conversion of the Convertible Securities
(including changes to the conversion price, conversion settlement dates or
conversion conditions, in each case without the prior consent of Dealer, such
consent not to be unreasonably withheld or delayed.

(c)        Alternative Calculations and Payment on Early Termination and on
Certain Extraordinary Events. If Dealer shall owe Counterparty any amount
pursuant to Section 12.2 of the Equity Definitions or “Consequences of Merger
Events” above, or Section 12.6, 12.7 or 12.9 of the Equity Definitions or
pursuant to Section 6(d)(ii) of the Agreement (a “Payment Obligation”),
Counterparty shall have the right, in its sole discretion, to require Dealer to
satisfy any such Payment Obligation by the Share Termination Alternative (as
defined below) by giving irrevocable telephonic notice to Dealer, confirmed in
writing within one Scheduled Trading Day, no later than 9:30 A.M. New York City
time on the relevant

 

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Merger Date, Announcement Date (as a result of a Nationalization, Insolvency or
Delisting), Early Termination Date or date of cancellation or termination in
respect of an Extraordinary Event, as applicable (“Notice of Share
Termination”); provided that if Counterparty does not elect to require Dealer to
satisfy its Payment Obligation by the Share Termination Alternative, Dealer
shall have the right, in its commercially reasonable discretion, to elect to
satisfy its Payment Obligation by the Share Termination Alternative,
notwithstanding Counterparty’s failure to elect or election to the contrary; and
provided further that Counterparty shall not have the right to so elect (but,
for the avoidance of doubt, Dealer shall have the right to so elect) in the
event of (i) an Insolvency, a Nationalization or a Merger Event, in each case,
in which the consideration or proceeds to be paid to holders of Shares consists
solely of cash or (ii) an Event of Default in which Counterparty is the
Defaulting Party or a Termination Event in which Counterparty is the Affected
Party, which Event of Default or Termination Event resulted from an event or
events within Counterparty’s control. Upon such Notice of Share Termination, the
following provisions shall apply on the Scheduled Trading Day immediately
following the relevant Merger Date, Announcement Date, Early Termination Date or
date of cancellation or termination in respect of an Extraordinary Event, as
applicable:

 

Share Termination Alternative:  

Applicable and means that Dealer shall deliver to Counterparty the Share
Termination Delivery Property on the date on which the Payment Obligation would
otherwise be due pursuant to “Consequences of Merger Events” above or Section
12.2, 12.6, 12.7 or 12.9 of the Equity Definitions or Section 6(d)(ii) of the
Agreement, as applicable, or such later date as the Calculation Agent may
reasonably determine (the “Share Termination Payment Date”), in satisfaction of
the Payment Obligation.

Share Termination Delivery

Property:

 

 

A number of Share Termination Delivery Units, as calculated by the Calculation
Agent, equal to the Payment Obligation divided by the Share Termination Unit
Price. The Calculation Agent shall adjust the Share Termination Delivery
Property by replacing any fractional portion of a security therein with an
amount of cash equal to the value of such fractional security based on the
values used to calculate the Share Termination Unit Price.

Share Termination Unit Price:  

The value of property contained in one Share Termination Delivery Unit on the
date such Share Termination Delivery Units are to be delivered as Share
Termination Delivery Property, as determined by the Calculation Agent in its
discretion by commercially reasonable means and notified by the Calculation
Agent to Dealer at the time of notification of the Payment Obligation.

Share Termination Delivery Unit:  

In the case of a Termination Event, Event of Default, Delisting or Additional
Disruption Event, one Share or, in the case of an Insolvency, Nationalization or
Merger Event, one Share or a unit consisting of the number or amount of each
type of property received by a holder of one Share (without consideration of any
requirement to pay cash or other consideration in lieu of fractional amounts of
any securities) in such Insolvency, Nationalization or Merger Event, as
applicable. If such Insolvency, Nationalization or Merger Event involves a
choice of consideration to be received by holders, such holder shall be deemed
to have elected to receive the maximum possible amount of cash.

Failure to Deliver:  

Applicable

Other Applicable Provisions:  

If Share Termination Alternative is applicable, the provisions of Sections 9.8,
9.9, 9.10, 9.11 and 9.12 of the Equity Definitions will be applicable as if
“Physical Settlement” applied to the Transaction, except that all references to
“Shares” shall be read as references to

 

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“Share Termination Delivery Units”; provided that the Representation and
Agreement contained in Section 9.11 of the Equity Definitions shall be modified
by excluding any representations therein relating to restrictions, obligations,
limitations or requirements under applicable securities laws as a result of the
fact that Counterparty is the issuer of any Share Termination Delivery Units (or
any part thereof).

(d)        Disposition of Hedge Shares.    Counterparty hereby agrees that if,
in the good faith reasonable judgment of Dealer, based on the advice of counsel,
the Shares (the “Hedge Shares”) acquired by Dealer for the purpose of hedging
its obligations pursuant to the Transaction cannot be sold in the U.S. public
market by Dealer without registration under the Securities Act, Counterparty
shall, at its election: (i) in order to allow Dealer to sell the Hedge Shares in
a registered offering, make available to Dealer an effective registration
statement under the Securities Act to cover the resale of such Hedge Shares and
(A) enter into an agreement, in form and substance reasonably satisfactory to
Dealer, substantially in the form of an underwriting agreement for a registered
offering, (B) provide accountant’s “comfort” letters in customary form for
registered offerings of equity securities, (C) provide disclosure letters of
nationally recognized outside counsel to Counterparty reasonably acceptable to
Dealer, (D) provide other customary opinions, certificates and closing documents
customary in form for registered offerings of equity securities and (E) afford
Dealer a reasonable opportunity to conduct a “due diligence” investigation with
respect to Counterparty customary in scope for underwritten offerings of equity
securities; provided, however, that if Counterparty elects clause (i) above but
the items referred to therein are not completed in a timely manner, or if
Dealer, in its commercially reasonable discretion, is not satisfied with access
to due diligence materials, the results of its due diligence investigation, or
the procedures and documentation for the registered offering referred to above,
then clause (ii) or clause (iii) of this Section 8(d) shall apply at the
election of Counterparty; (ii) in order to allow Dealer to sell the Hedge Shares
in a private placement, enter into a private placement agreement substantially
similar to private placement purchase agreements customary for private
placements of equity securities, in form and substance reasonably satisfactory
to Dealer, including customary representations, covenants, blue sky and other
governmental filings and/or registrations, indemnities to Dealer, due diligence
rights (for Dealer or any designated buyer of the Hedge Shares from Dealer),
opinions and certificates and such other documentation as is customary for
private placements agreements, all reasonably acceptable to Dealer (in which
case, the Calculation Agent shall make any adjustments to the terms of the
Transaction that are necessary, in its reasonable judgment, to compensate Dealer
for any discount from the public market price of the Shares incurred on the sale
of Hedge Shares in a private placement); or (iii) purchase the Hedge Shares from
Dealer at the Daily VWAP (as defined in the Indenture) on such Exchange Business
Days, and in the amounts, requested by Dealer. This Section 8(d) shall survive
the termination, expiration or early unwind of the Transaction.

(e)        Repurchase and Conversion Rate Adjustment Notices.  Counterparty
shall, by 12:00 noon, New York City time, on the Exchange Business Day prior to
any day on which Counterparty effects any repurchase of Shares or consummates or
otherwise engages in any transaction or event (a “Conversion Rate Adjustment
Event”) that would reasonably be expected to lead to an increase in the
Conversion Rate, give Dealer a written notice of such repurchase or Conversion
Rate Adjustment Event (a “Repurchase Notice”) on such day if, following such
repurchase or Conversion Rate Adjustment Event, the Notice Percentage would
reasonably be expected to be (i) greater than 8.0% and (ii) greater by 0.5% than
the Notice Percentage included in the immediately preceding Repurchase Notice
(or, in the case of the first such Repurchase Notice, greater than the Notice
Percentage as of the date hereof). The “Notice Percentage” as of any day is the
fraction, expressed as a percentage, the numerator of which is the sum of
(i) the Number of Shares, (ii) the “Number of Shares” under the Base Convertible
Bond Hedge Transaction dated February 7, 2011 and (iii) the “Number of Shares”
under the Additional Convertible Bond Hedge Transaction dated February 8, 2011,
and (iv) the “Number of Shares” under the Base Convertible Bond Hedge
Transaction Confirmation and the denominator of which is the number of Shares
outstanding on such day. In the event that Counterparty fails to provide Dealer
with a Repurchase Notice on the day and in the manner specified in this
Section 8(e) then Counterparty agrees to indemnify and hold harmless Dealer, its
affiliates and their respective directors, officers, employees, agents and
controlling persons (Dealer and each such person being an “Indemnified Party”)
from and against any and all losses (including losses relating to the Dealer’s
hedging activities as a consequence of becoming, or of the risk of becoming, a

 

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Section 16 “insider”, including without limitation, any forbearance from hedging
activities or cessation of hedging activities and any losses in connection
therewith with respect to this Transaction), claims, damages and liabilities (or
actions in respect thereof), joint or several, to which such Indemnified Party
may become subject under applicable securities laws, including without
limitation, Section 16 of the Exchange Act or under any state or federal law,
regulation or regulatory order, relating to or arising out of such failure. If
for any reason the foregoing indemnification is unavailable to any Indemnified
Party or insufficient to hold harmless any Indemnified Party, then Counterparty
shall contribute, to the maximum extent permitted by law, to the amount paid or
payable by the Indemnified Party as a result of such loss, claim, damage or
liability. In addition, Counterparty will reimburse any Indemnified Party for
all expenses (including reasonable counsel fees and expenses) as they are
incurred (after notice to Counterparty) in connection with the investigation of,
preparation for or defense or settlement of any pending or threatened claim or
any action, suit or proceeding arising therefrom, whether or not such
Indemnified Party is a party thereto and whether or not such claim, action, suit
or proceeding is initiated or brought by or on behalf of Counterparty. This
indemnity shall survive the completion of the Transaction contemplated by this
Confirmation and any assignment and delegation of the Transaction made pursuant
to this Confirmation or the Agreement shall inure to the benefit of any
permitted assignee of Dealer.

(f)        Transfer and Assignment.    Either party may transfer or assign any
of its rights or obligations under the Transaction with the prior written
consent of the non-transferring party, such consent not to be unreasonably
withheld or delayed; provided that Dealer may transfer or assign without any
consent of Counterparty its rights and obligations hereunder, in whole or in
part, to any of its affiliates whose obligations hereunder will be guaranteed,
pursuant to the terms of a customary guarantee in a form used by Dealer
generally for similar transactions, by Dealer or JPMorgan Chase & Co., provided,
further, that if at any time at which (1) the Equity Percentage exceeds 9.0%,
(2) the Option Equity Percentage exceeds 14.5% or (3) Dealer, Dealer Group (as
defined below) or any person whose ownership position would be aggregated with
that of Dealer or Dealer Group (Dealer, Dealer Group or any such person, a
“Dealer Person”) under Section 203 of the Delaware General Corporation Law or
other federal, state or local regulations or regulatory orders applicable to
ownership of Shares (“Applicable Laws”), owns, beneficially owns, constructively
owns, controls, holds the power to vote or otherwise meets a relevant definition
of ownership in excess of a number of Shares equal to (x) the number of Shares
that would give rise to reporting, registration, filing or notification
obligations (other than on Schedule 13D or 13G under the Exchange Act) or other
requirements (including obtaining prior approval by a state or federal
regulator) of a Dealer Person under Applicable Laws and with respect to which
such requirements have not been met or the relevant approval has not been
received minus (y) 1% of the number of Shares outstanding on the date of
determination (either such condition described in clause (1), (2) or (3), an
“Excess Ownership Position”), if Dealer, in its commercially reasonable
discretion, is unable to effect a transfer or assignment to a third party after
its commercially reasonable efforts on pricing and terms and within a time
period reasonably acceptable to Dealer such that an Excess Ownership Position no
longer exists, Dealer may designate any Scheduled Trading Day as an Early
Termination Date with respect to a portion (the “Terminated Portion”) of the
Transaction, such that an Excess Ownership Position no longer exists following
such partial termination. In the event that Dealer so designates an Early
Termination Date with respect to a portion of the Transaction, a payment or
delivery shall be made pursuant to Section 6 of the Agreement and Section 8(c)
of this Confirmation as if (i) an Early Termination Date had been designated in
respect of a Transaction having terms identical to the Terminated Portion of the
Transaction, (ii) Counterparty were the sole Affected Party with respect to such
partial termination, (iii) such portion of the Transaction were the only
Terminated Transaction and (iv) Dealer were the party entitled to designate an
Early Termination Date pursuant to Section 6(b) of the Agreement and to
determine the amount payable pursuant to Section 6(e) of the Agreement. The
“Equity Percentage” as of any day is the fraction, expressed as a percentage,
(A) the numerator of which is the number of Shares that Dealer and any of its
affiliates subject to aggregation with Dealer for purposes of the “beneficial
ownership” test under Section 13 of the Exchange Act and all persons who may
form a “group” (within the meaning of Rule 13d-5(b)(1) under the Exchange Act)
with Dealer (collectively, “Dealer Group”) “beneficially own” (within the
meaning of Section 13 of the Exchange Act) without duplication on such day and
(B) the denominator of which is the number of Shares outstanding on such day.
The “Option Equity Percentage” as of any day is the fraction, expressed as a
percentage, (A) the numerator of which is the sum of (1) the product of (x) the
Number of Options, (y) the Option Entitlement and (z) the Applicable Percentage,
and (2) the aggregate

 

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number of Shares underlying any other call option transaction sold by Dealer to
Counterparty, and (B) the denominator of which is the number of Shares
outstanding. Dealer agrees that Dealer Group shall use commercially reasonable
efforts, in consultation with counsel as to legal and regulatory issues and in
compliance with any related polices and procedures of Dealer, consistently
applied, to hedge its exposure to the Transaction and to manage its other
positions through the use of cash-settled swaps or other derivative instruments
to the extent necessary to avoid the occurrence of an Excess Ownership Position.
In the case of a transfer or assignment by Counterparty of its rights and
obligations hereunder and under the Agreement, in whole or in part (any such
Options so transferred or assigned, the “Transfer Options”), to any party,
withholding of such consent by Dealer shall not be considered unreasonable if
such transfer or assignment does not meet the reasonable conditions that Dealer
may impose including, but not limited, to the following conditions:

(A)        With respect to any Transfer Options, Counterparty shall not be
released from its notice and indemnification obligations pursuant to
Section 8(e) or any obligations under Section 2 (regarding Extraordinary Events)
or 8(d) of this Confirmation;

(B)        Any Transfer Options shall only be transferred or assigned to a third
party that is a U.S. person (as defined in the Internal Revenue Code of 1986, as
amended);

(C)        Such transfer or assignment shall be effected on terms, including any
reasonable undertakings by such third party (including, but not limited to,
undertakings with respect to compliance with applicable securities laws in a
manner that, in the reasonable judgment of Dealer, will not expose Dealer to
material risks under applicable securities laws) and execution of any
documentation and delivery of legal opinions with respect to securities laws and
other matters by such third party and Counterparty as are requested and
reasonably satisfactory to Dealer;

(D)        Dealer will not, as a result of such transfer and assignment, be
required to pay the transferee on any payment date an amount under
Section 2(d)(i)(4) of the Agreement greater than an amount that Dealer would
have been required to pay to Counterparty in the absence of such transfer and
assignment;

(E)        An Event of Default, Potential Event of Default or Termination Event
will not occur as a result of such transfer and assignment;

(F)        Without limiting the generality of clause (B), Counterparty shall
have caused the transferee to make such Payee Tax Representations and to provide
such tax documentation as may be reasonably requested by Dealer to permit Dealer
to determine that results described in clauses (D) and (E) will not occur upon
or after such transfer and assignment; and

(G)        Counterparty shall be responsible for all reasonable costs and
expenses, including reasonable counsel fees, incurred by Dealer in connection
with such transfer or assignment.

(g)        Staggered Settlement. Dealer may, by notice to Counterparty prior to
any Settlement Date (a “Nominal Settlement Date”), elect to deliver the Shares
on one or more dates (each, a “Staggered Settlement Date”) or at two or more
times on the Nominal Settlement Date as follows:

(i)        in such notice, Dealer will specify to Counterparty the related
Staggered Settlement Dates (each of which will be on or prior to such Nominal
Settlement Date, but not prior to the first day of the relevant Cash Settlement
Averaging Period) or delivery times and how it will allocate the Shares it is
required to deliver under “Delivery Obligation” (above) among the Staggered
Settlement Dates or delivery times; and

(ii)      the aggregate number of Shares that Dealer will deliver to
Counterparty hereunder on all such Staggered Settlement Dates and delivery times
will equal the number of Shares that Dealer would otherwise be required to
deliver on such Nominal Settlement Date.

(h)        Disclosure.  Effective from the date of commencement of discussions
concerning the Transaction, Counterparty and each of its employees,
representatives, or other agents may disclose to any and all persons, without
limitation of any kind, the tax treatment and tax structure of the Transaction
and all

 

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materials of any kind (including opinions or other tax analyses) that are
provided to Counterparty relating to such tax treatment and tax structure.

(i)        No Netting and Set-off.  The provisions of Section 2(c) of the
Agreement shall not apply to the Transaction. Each party waives any and all
rights it may have to set-off delivery or payment obligations it owes to the
other party under the Transaction against any delivery or payment obligations
owed to it by the other party, whether arising under the Agreement, under any
other agreement between parties hereto, by operation of law or otherwise.

(j)        Equity Rights.  Dealer acknowledges and agrees that this Confirmation
is not intended to convey to it rights with respect to the Transaction that are
senior to the claims of common stockholders in the event of Counterparty’s
bankruptcy. For the avoidance of doubt, the parties agree that the preceding
sentence shall not apply at any time other than during Counterparty’s bankruptcy
to any claim arising as a result of a breach by Counterparty of any of its
obligations under this Confirmation or the Agreement. For the avoidance of
doubt, the parties acknowledge that the obligations of Counterparty under this
Confirmation are not secured by any collateral that would otherwise secure the
obligations of Counterparty herein under or pursuant to any other agreement.

(k)        Early Unwind.  In the event the sale by Counterparty of the
Convertible Securities is not consummated pursuant to the Underwriting Agreement
for any reason by the close of business in New York on August 2, 2011 (or such
later date as agreed upon by the parties, which in no event shall be later than
August 9, 2011) (August 2, 2011] or such later date being the “Early Unwind
Date”), the Transaction shall automatically terminate (the “Early Unwind”) on
the Early Unwind Date and the Transaction and all of the respective rights and
obligations of Dealer and Counterparty hereunder shall be cancelled and
terminated and Counterparty shall pay to Dealer, other than in cases involving a
breach of the Underwriting Agreement by the underwriters, an amount in cash
equal to the aggregate amount of costs and expenses relating to the unwinding of
Dealer’s hedging activities in respect of the Transaction (including market
losses incurred in reselling any Shares purchased by Dealer or its affiliates in
connection with such hedging activities, unless Counterparty agrees to purchase
any such Shares at the cost at which Dealer purchased such Shares) or, at the
election of Counterparty, deliver to Dealer Shares with a value equal to such
amount, as determined by the Calculation Agent, in which event the parties shall
enter into customary and commercially reasonable documentation relating to the
registered or exempt resale of such Shares. Following such termination,
cancellation and payment or delivery, each party shall be released and
discharged by the other party from, and agrees not to make any claim against the
other party with respect to, any obligations or liabilities of either party
arising out of, and to be performed in connection with, the Transaction either
prior to or after the Early Unwind Date. Dealer and Counterparty represent and
acknowledge to the other that upon an Early Unwind and following the payment
referred to above, all obligations with respect to the Transaction shall be
deemed fully and finally discharged.

(l)    Governing Law.  THE AGREEMENT, THIS CONFIRMATION AND ALL MATTERS ARISING
IN CONNECTION WITH THE AGREEMENT AND THIS CONFIRMATION SHALL BE GOVERNED BY, AND
CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK
(WITHOUT REFERENCE TO ITS CHOICE OF LAW DOCTRINE, OTHER THAN TITLE 14 OF THE NEW
YORK GENERAL OBLIGATIONS LAW).

(m)  Amendment.    This Confirmation and the Agreement may not be modified,
amended or supplemented, except in a written instrument signed by Counterparty
and Dealer.

(n)  Counterparts.    This Confirmation may be executed in several counterparts,
each of which shall be deemed an original but all of which together shall
constitute one and the same instrument.

(o)  Illegality.  The parties agree that, for the avoidance of doubt, for
purposes of Section 5(b)(i) of the Agreement, “any applicable law” shall include
the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, any rules
and regulations promulgated thereunder, without regard to Section 739 of the
Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, and the
consequences specified in the Agreement, including without limitation, the
consequences specified in Section 6 of the Agreement, shall apply to any
Illegality arising from any such act, rule or regulation.

 

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(p) Notice of Acquisition of Bank Shares or Assets. Counterparty shall give
Dealer a written notice no later than 30 days prior to any day on which
Counterparty effects any transaction subject to Section 3 of the Bank Holding
Company Act of 1956, as amended. Such notice shall describe such transaction in
reasonable detail and specify the anticipated effective date of such
acquisition.

(q) Designation by Dealer.   Notwithstanding any other provision in this
Confirmation to the contrary requiring or allowing Dealer to purchase, sell,
receive or deliver any Shares or other securities, or make or receive any
payment in cash, to or from Counterparty, Dealer may designate any of its
affiliates to purchase, sell, receive or deliver such Shares or other
securities, or to make or receive such payment in cash, and otherwise to perform
Dealer’s obligations in respect of the Transaction and any such designee may
assume such obligations; provided that such designation shall not result in any
additional costs or liabilities for Counterparty. For the avoidance of doubt,
Dealer hereby acknowledges that notwithstanding any such designation hereunder,
to the extent any of Dealer’s obligations in respect of this Transaction are not
completed by its designee, Dealer shall be obligated to continue to perform or
to cause any other of its designees to perform in respect of such obligations.

9.    Waiver of Jury Trial.  Each party waives, to the fullest extent permitted
by applicable law, any right it may have to a trial by jury in respect of any
suit, action or proceeding relating to the Transaction. Each party (i) certifies
that no representative, agent or attorney of the other party has represented,
expressly or otherwise, that such other party would not, in the event of such a
suit, action or proceeding, seek to enforce the foregoing waiver and
(ii) acknowledges that it and the other party have been induced to enter into
the Transaction by, among other things, the mutual waivers and certifications
provided herein.

10.  Submission to Jurisdiction.  Section 13(b) of the Agreement is deleted in
its entirety and replaced by the following:

 

“Each party hereby irrevocably and unconditionally submits for itself and its
property in any suit, legal action or proceeding relating to the Agreement
and/or the Transaction, or for recognition and enforcement of any judgment in
respect thereof, (each, “Proceedings”) to the exclusive jurisdiction of the
Supreme Court of the State of New York, sitting in New York County, the courts
of the United States of America for the Southern District of New York and
appellate courts from any thereof. Nothing in this Confirmation or the Agreement
precludes either party from bringing Proceedings in any other jurisdiction if
(A) the courts of the State of New York or the United States of America for the
Southern District of New York lack jurisdiction over the parties or the subject
matter of the Proceedings or declines to accept the Proceedings on the grounds
of lacking such jurisdiction; (B) the Proceedings are commenced by a party for
the purpose of enforcing against the other party’s property, assets or estate
any decision or judgment rendered by any court in which Proceedings may be
brought as provided hereunder; (C) the Proceedings are commenced to appeal any
such court’s decision or judgment to any higher court with competent appellate
jurisdiction over that court’s decisions or judgments if that higher court is
located outside the State of New York or Borough of Manhattan, such as a federal
court of appeals or the U.S. Supreme Court; or (D) any suit, action or
proceeding has been commenced in another jurisdiction by or against the other
party or against its property, assets or estate and, in order to exercise or
protect its rights, interests or remedies under the Agreement or this
Confirmation, the party (1) joins, files a claim, or takes any other action, in
any such suit, action or proceeding, or (2) otherwise commences any Proceeding
in that other jurisdiction as the result of that other suit, action or
proceeding having commenced in that other jurisdiction.”

 

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LOGO [g215203ex10_2logo.jpg]

Counterparty hereby agrees (a) to check this Confirmation carefully and promptly
upon receipt so that errors or discrepancies can be promptly identified and
rectified and (b) to confirm that the foregoing (in the exact form provided by
Dealer) correctly sets forth the terms of the agreement between Dealer and
Counterparty with respect to the Transaction, by manually signing this
Confirmation or this page hereof as evidence of agreement to such terms and
providing the other information requested herein and promptly returning an
executed copy to EDG Marketing Support, J.P. Morgan Securities LLC, fax
(866) 886-4506.

 

Yours faithfully,

J.P. Morgan Securities LLC, as agent for

JPMorgan Chase Bank, National Association

By:  

/s/ Santosh Sreenivasan

Authorized Signatory

Name: SANTOSH SREENIVASAN

 

Agreed and Accepted By: MF GLOBAL HOLDINGS LTD. By:  

/s/ David Dunne

  Name:        David Dunne   Title:          Treasurer

JPMorgan Chase Bank, National Association

Organised under the laws of the United States as a National Banking Association

Main Office 1111 Polaris Parkway, Columbus, Ohio 43271

Registered as a branch in England & Wales branch No. BR000746

Registered Branch Office 125 London Wall, London EC2Y 5AJ

Authorised and regulated by the Financial Services Authority

[Bond Hedge]