Exhibit
4.2


 


AXIS CAPITAL HOLDINGS LIMITED


AMENDED AND RESTATED


SERIES A WARRANT FOR THE PURCHASE
OF COMMON SHARES

OF AXIS CAPITAL HOLDINGS LIMITED


No. A-[ 
]


Series A
Warrant to Purchase

[            ] Shares


THIS SECURITY HAS NOT BEEN
REGISTERED UNDER THE UNITED STATES SECURITIES ACT OF 1933, AS AMENDED.  THIS SECURITY CANNOT BE OFFERED, TRANSFERRED
OR SOLD UNLESS (I) A REGISTRATION STATEMENT UNDER SUCH ACT IS IN EFFECT WITH
RESPECT TO SUCH SECURITIES OR A WRITTEN OPINION FROM COUNSEL ACCEPTABLE TO THE
COMPANY IS OBTAINED TO THE EFFECT THAT NO SUCH REGISTRATION IS REQUIRED AND
(II) THE TRANSFEREE IS APPROVED BY APPLICABLE REGULATORY AUTHORITIES, IF SUCH
APPROVAL IS REQUIRED.  TRANSFERS OF THIS
SECURITY ARE SUBJECT TO THE APPROVAL OF THE BOARD OF DIRECTORS OF THE COMPANY,
IN ITS SOLE DISCRETION.  THIS SECURITY
IS ALSO SUBJECT TO ADDITIONAL RESTRICTIONS ON TRANSFER, VOTING AND OTHER
MATTERS AS SET FORTH IN THE COMPANY’S BYE-LAWS.


This warrant (the “Warrant”)
is being issued in consideration for the surrender by the Holder (defined
below) of that certain Series A Warrant No. [  
] for the purchase of common stock of AXIS Capital Holdings Limited, a
Bermuda company (the “Company”), issued by the Company in favor of the Holder
and dated as of December 31, 2002 (the “Old Warrant”).  The Old Warrant is being surrendered in
exchange for this Warrant in order to provide a warrant that states the current
number of shares for which the Warrant may be exercised, which number became
fixed pursuant to the terms of the Old Warrant at the close of business on the
day immediately preceding the date of consummation of an initial public
offering of the Company’s common shares and that reflects changes automatically
resulting from the occurrence of such initial public offering and the stock
split that occurred immediately prior thereto.


FOR VALUE RECEIVED, Company
hereby certifies that [               ],
its successor or permitted assigns (the “Holder”) is entitled, subject to the
terms herein, to purchase [    ] fully
paid and non-assessable shares of 
Common Stock (as defined herein) (the “Warrant Shares”) at a purchase
price per share equal to the Exercise Price (as defined herein).  The number of Warrant Shares to be received
upon the exercise of this Warrant and the price to be paid for such shares are
subject to adjustment from time to time as hereinafter set forth.


1.             Definitions.  The following terms, as used herein, have the following meanings:


“Affiliate” shall have the
meaning given to such term in Rule 12b-2 promulgated under the United States
Securities and Exchange Act of 1934, as amended.


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


 

















 


“Common Stock” means the
voting common shares, par value $0.0125 per share, of the Company.


 “Exercise Price” means $12.50 per Warrant Share, subject to
adjustment as provided herein.


“Expiration Date” means
November 20, 2011 at 5:00 p.m. New York City time.


 


2.             Exercise of Warrant.  (a) 
The Holder is entitled to exercise this Warrant in whole or in part at
any time, or from time to time, until the Expiration Date.  To exercise this Warrant, the Holder shall
execute and deliver to the Company a Warrant Exercise Notice substantially in
the form attached hereto.  Subject to
Section 2(d) below, no earlier than ten days after delivery of the Warrant
Exercise Notice, the Holder shall deliver to the Company this Warrant
Certificate, including the Warrant Exercise Subscription Form attached hereto
duly executed by the Holder, together with payment of the applicable Exercise
Price.  Upon such delivery and payment,
the Holder shall be deemed to be the holder of record of the Warrant Shares
subject to such exercise, notwithstanding that the register of members of the
Company shall then be closed or that certificates representing such Warrant
Shares shall not then be actually delivered to the Holder.


(b)           Subject
to Section 2(d) below, the Exercise Price may be paid in cash or by certified
or official bank check or bank cashier’s check payable to the order of the
Company or by any combination of such cash or check.  The Company shall pay any and all documentary, stamp or similar
issue or transfer taxes payable in respect of the issue or delivery of the
Warrant Shares.


(c)           Upon
surrender of this Warrant Certificate in conformity with the provisions
hereunder, the Company shall transfer to the Holder appropriate evidence of
ownership of the Warrant Shares or any other securities or property (including
any money) to which the Holder is entitled, registered or otherwise placed in,
or payable to the order of, the name or names of the Holder or such transferee
as may be directed in writing by the Holder, and shall deliver such evidence of
ownership and any other securities or property (including any money) to the
Person or Persons entitled to receive the same, together with an amount in cash
in lieu of any fraction of a share as provided in Section 3 below.


(d)           In
lieu of making the cash payment required to exercise the Warrant pursuant to
this Section 2, the Holder may elect to (i) deliver as payment, in whole or in
part of the aggregate Exercise Price, shares of Common Stock having a value
calculated by reference to the aggregate Daily Price (as defined below) on the
day immediately preceding the date on which the Holder delivers written notice
to the Company pursuant to Section 2(a) equal to or in excess of the applicable
portion of the aggregate Exercise Price for the Warrant Shares or (ii) exchange
this Warrant for shares of Common Stock, in which event the Company will issue
to the Holder the number of shares of Common Stock equal to the result obtained
by (A) subtracting the Exercise Price from the Daily Price, (B) multiplying the
difference by the number of Shares for which the


 


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 Warrant is
being exercised, and (C) dividing the product by the Daily Price as set forth
in the following equation:


X               =      (A - B) x C  
where: 

A


X               =      the
number of shares of Common Stock issuable upon exercise pursuant to this
Section 2(d).


A              =      the Daily Price (as defined below) on the day immediately
preceding the date on which the Holder delivers written notice to the Company
pursuant to Section 2(a).


B                =      the
Exercise Price


C                =      the
number of Shares for which the Warrant is being exercised


If the foregoing calculation results in a negative number, then no
shares of Common Stock shall be issued upon exercise pursuant to this Section
2(d)(ii).


3.              No Fractional Shares.  The Company shall not be required to issue a
fractional share of common stock upon the exercise of this Warrant.  If any fractional interest in a share of
common stock would be deliverable upon the exercise of this Warrant in whole or
in part, the Company, in lieu of delivering any such fractional share, shall
pay an amount in cash equal to the book value per share at the end of the most
recent fiscal quarter multiplied by the fraction of the fractional share which
would otherwise have been issued hereunder. 
The Company agrees that it will not change the par value of the Common
Stock from par value $0.0125 per share to any higher par value which exceeds
the Exercise Price then in effect, and will reduce the par value of the Common
Stock upon any event that would, but for this provision, reduce the Exercise
Price below the par value of the Common Stock.


4.             Reservation of Shares.  The Company agrees that it will at all times
reserve for issuance and delivery upon exercise of this Warrant such number of
its authorized but unissued shares of Common Stock sufficient to permit the
exercise in full of this Warrant.  All
such shares shall be duly authorized and, when issued upon such exercise, shall
be validly issued, fully paid and non-assessable, free and clear of all
liens, security interests, charges and other encumbrances or restrictions on sale,
except to the extent set forth in the Bye-Laws.


5.             Transfer Restrictions.  (a) 
This Warrant may not be assigned or otherwise transferred, disposed of
or encumbered by the Holder in whole or in part except pursuant to an
assignment approved by the Board of Directors of the Company in accordance with
the following rules:


(i)            An
assignment, as to all or any of the Warrant Shares, shall be in writing in a
form acceptable to the Board of Directors, shall be signed by or on behalf of
the assignor and shall be accompanied by satisfactory evidence of the authority
of any person signing on behalf of the assignor.


 


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(ii)           The
Board of Directors shall have the same obligations, powers and discretions in
regard to the assignment of the Warrant as shall be vested in them by the Bye-Laws
of the Company in regard to the transfer of shares of Common Stock; provided, however,
that the provisions of the Bye-Laws referring to share certificates shall
not apply in regard to the Warrant. 
Additionally, the Board of Directors may require, before approving an
assignment, that (A) the assignor surrender the original of this Warrant
Certificate (or, in the case of a subsequent Holder, the original Warrant
Certificate issued by the Company to him) to be endorsed with a notation of the
assignment and, in the event of a partial assignment, returned to the assignor
and/or (B) that the assignee enter into an agreement with the Company
acknowledging the terms of the Warrant and (C) that the assignee confirms
that it is an “accredited investor”, as such term is defined in the United
States Securities Act of 1933, as amended.


(iii)          If
the Board of Directors declines to approve an assignment they shall notify the
assignee within one month of such refusal. 
If the Board of Directors approves an assignment they shall within the
same period issue to the assignee a Warrant Certificate on substantially the
terms of this Warrant and, as regards the assigned Warrant, the Company shall
recognize the assignee as the Holder for all purposes and the assignor shall
cease to have any interest herein.


(b)           Notwithstanding
the foregoing, the Holder shall be entitled, without obtaining the consent of
the Company, to make an assignment of its interest in this Warrant in whole or
in part to any Affiliate of the Holder; provided
that concurrently with any such assignment of this Warrant or any part hereof,
and as a condition precedent to such valid assignment to such assignee, the
assignee shall execute and deliver to the Company an agreement to comply with
all restrictions and conditions relating to the ownership of this Warrant as
are herein set forth.


(c)           Except
as provided in paragraph (b), neither the Warrant nor any of the Warrant
Shares, nor any interest in either, may be sold, assigned, pledged,
hypothecated, encumbered or in any other manner transferred or disposed of, in
whole or in part, except in compliance with the terms, conditions and
restrictions as set forth in the Bye-Laws of the Company, applicable
United States federal and state securities laws and the terms and conditions
hereof.  Each certificate for Warrant
Shares issued upon exercise of the Warrant, unless at the time of exercise such
Warrant Shares are registered under the United States Securities Act of 1933,
as amended, shall bear the following legend:


“These securities have not
been registered under the United States Securities Act of 1933, as
amended.  These securities cannot be
offered, transferred or sold unless (i) a registration statement under such Act
is in effect with respect to such securities or an exemption from the
registration requirements of such act is applicable and a written opinion from
counsel reasonably acceptable to AXIS Capital Holdings Limited (the “Company”)
is obtained to the effect that no such registration is required and (ii) the
transferee is approved by applicable regulatory authorities, if such approval
is required.  The Company reserves the
right to refuse the transfer of such securities until such conditions have been
fulfilled.


 


 


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(d)           Notwithstanding
the foregoing, in the event that the laws of any jurisdiction to which the
Holder, or any Affiliate of the Holder, is subject, make it illegal for such
entity to hold the Warrant or the Warrant Shares, the Company shall use its
best efforts to facilitate, and shall not unreasonably withhold its permission
to allow for, the transfer, sale or assignment of the Warrant and/or the
Warrant Shares.


6.             Anti-Dilution Provisions.  (a) 
In case the Company shall at any time after the date hereof (i) declare
a dividend or make a distribution on Common Stock payable in Common Stock, (ii)
subdivide or split the outstanding Common Stock, (iii) combine or reclassify
the outstanding Common Stock into a smaller number of shares, or (iv) issue any
shares of its capital stock in a reclassification of Common Stock (including
any such reclassification in connection with a consolidation, scheme of
arrangement or amalgamation in which the Company is the surviving entity), the
Exercise Price in effect at the time of the record date for such dividend or
distribution or of the effective date of such subdivision, split, combination
or reclassification shall be proportionately adjusted so that, giving effect to
Section 6(i), the exercise of this Warrant after such time shall entitle the
holder to receive the aggregate number of shares of Common Stock or other
securities of the Company (or shares of any security into which such shares of
Common Stock have been reclassified) which, if this Warrant had been exercised
immediately prior to such time, such holder would have owned upon such exercise
and been entitled to receive by virtue of such dividend, distribution,
subdivision, split, combination, amalgamation, scheme of arrangement or
reclassification.  Such adjustment shall
be made successively whenever any event listed above shall occur.


(b)           In
case the Company shall issue or sell any Common Stock (other than Common Stock
issued (i) upon exercise of the Warrants, (ii) pursuant to the Company’s stock
option plan or pursuant to any similar Common Stock-related director or
employee compensation plan of the Company approved by the Company’s Board of
Directors or (iii) upon exercise or conversion of any security the issuance of
which caused an adjustment under paragraphs (c) or (d) hereof) without
consideration or for a consideration per share less than the Current Market
Price Per Common Share (as defined in paragraph (f) immediately preceding such
issuance or sale or immediately preceding the announcement thereof, if
earlier), the Exercise Price to be in effect after such issuance or sale shall
be determined by multiplying the Exercise Price in effect immediately prior to
such issuance or sale or immediately preceding the announcement thereof, if
earlier, as the case may be, by a fraction, the numerator of which shall be the
sum of (x) the number of shares of Common Stock outstanding immediately prior
to the time of such issuance or sale multiplied by the Current Market Price Per
Common Share immediately prior to such issuance or sale or immediately
preceding the announcement thereof, as the case may be, and (y) the aggregate
consideration, if any, to be received by the Company upon such issuance or sale,
and the denominator of which shall be the product of the aggregate number of
shares of Common Stock outstanding immediately after such issuance or sale and
the Current Market Price Per Common Share immediately prior to such issuance or
sale or immediately preceding the announcement thereof, as the case may
be.  In case any portion of the
consideration to be received by the Company shall be in a form other than cash,
the fair market value of such noncash consideration shall be utilized in the
foregoing computation.  Such fair market
value shall be determined by the Board of Directors of the Company; provided that if the Holder shall object
to any such determination, the Board of Directors shall retain an independent
appraiser reasonably satisfactory to the Holder to determine such fair market
value.  The Holder shall be 


 


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notified promptly of any consideration other than cash
to be received by the Company and furnished with a description of the
consideration and the fair market value thereof as determined by the Board of
Directors.


(c)           In
case the Company shall fix a record date for the issuance of rights, options or
warrants to the holders of its Common Stock or other securities entitling such
holders to subscribe for or purchase for a period expiring within 60 days of
such record date shares of Common Stock (or securities convertible into shares
of Common Stock) at a price per share of Common Stock (or having a conversion
price per share of Common Stock, if a security convertible into shares of
Common Stock) less than the Current Market Price Per Common Share on such
record date or immediately preceding the announcement thereof if earlier, the
maximum number of shares of Common Stock issuable upon exercise of such rights,
options or warrants (or conversion of such convertible securities) shall be
deemed to have been issued and outstanding as of such record date and the
Exercise Price shall be adjusted pursuant to paragraph (b) hereof as though
such maximum number of shares of Common Stock had been so issued for an
aggregate consideration payable by the holders of such rights, options,
warrants or convertible securities prior to their receipt of such shares of
Common Stock.  In case any portion of
such consideration shall be in a form other than cash, the fair market value of
such noncash consideration shall be determined as set forth in paragraph (b)
hereof.  Such adjustment shall be made
successively whenever such record date is fixed; and in the event that such
rights, options or warrants are not so issued or expire unexercised, or in the
event of a change in the number of shares of Common Stock to which the holders
of such rights, options or warrants are entitled (other than pursuant to
adjustment provisions therein comparable to those contained in this Section 6),
the Exercise Price shall again be adjusted to be the Exercise Price which would
then be in effect if such record date had not been fixed, in the former event,
or the Exercise Price which would then be in effect if such holder had
initially been entitled to such changed number of shares of Common Stock, in
the latter event.


(d)           In
case the Company shall issue rights, options (other than options issued
pursuant to a plan described in clause (b)(i) above) or warrants entitling the
holders thereof to subscribe for or purchase Common Stock (or securities
convertible into shares of Common Stock) or shall issue convertible securities,
and the price per share of Common Stock of such rights, options, warrants or
convertible securities (including, in the case of rights, options or warrants,
the price at which they may be exercised) is less than the Current Market Price
Per Common Share immediately preceding such issuance of rights, options or
warrants or immediately preceding the announcement thereof, if earlier, the
maximum number of shares of Common Stock issuable upon exercise of such rights,
options or warrants or upon conversion of such convertible securities shall be
deemed to have been issued and outstanding as of the date of such sale or
issuance, and the Exercise Price shall be adjusted pursuant to paragraph (b)
hereof as though such maximum number of shares of Common Stock had been so
issued for an aggregate consideration equal to the aggregate consideration paid
for such rights, options, warrants or convertible securities and the aggregate
consideration payable by the holders of such rights, options, warrants or
convertible securities prior to their receipt of such shares of Common Stock.  In case any portion of such consideration
shall be in a form other than cash, the fair market value of such noncash
consideration shall be determined as set forth in paragraph (b) hereof.  Such adjustment shall be made successively
whenever such rights, options, warrants or convertible securities are issued;
and in the event that such rights, options or warrants expire unexercised, or


 


6

















 


in the event of a change in the number of shares of
Common Stock to which the holders of such rights, options, warrants or
convertible securities are entitled (other than pursuant to adjustment
provisions therein comparable to those contained in this Section 6), the
Exercise Price shall again be adjusted to be the Exercise Price which would then
be in effect if such rights, options, warrants or convertible securities had
not been issued, in the former event, or the Exercise Price which would then be
in effect if such holders had initially been entitled to such changed number of
shares of Common Stock, in the latter event. 
No adjustment of the Exercise Price shall be made pursuant to this
paragraph (d) to the extent that the Exercise Price shall have been adjusted
pursuant to paragraph (c) upon the setting of any record date relating to such
rights, options, warrants or convertible securities and such adjustment fully
reflects the number of shares of Common Stock to which the holders of such
rights, options, warrants or convertible securities are entitled and the price
payable therefor.


(e)           In case
the Company shall fix a record date for the making of a distribution to holders
of Common Stock (including any such distribution made in connection with a
consolidation, scheme of arrangement or amalgamation in which the Company is
the surviving entity) of cash, evidences of indebtedness, assets or other
property (other than dividends payable in Common Stock or rights, options or
warrants referred to in, and for which an adjustment is made pursuant to,
paragraph (c) hereof), the Exercise Price to be in effect after such record
date shall be determined by multiplying the Exercise Price in effect
immediately prior to such record date or immediately preceding the announcement
thereof, by a fraction, the numerator of which shall be the Current Market Price
Per Common Share on such record date, less the fair market value (determined as
set forth in paragraph (b) hereof) of the portion of the assets, other property
or evidence of indebtedness so to be distributed which is applicable to one
share of Common Stock, and the denominator of which shall be such Current
Market Price Per Common Share.  Such
adjustments shall be made successively whenever such a record date is fixed;
and in the event that such distribution is not so made, the Exercise Price
shall again be adjusted to be the Exercise Price which would then be in effect
if such record date had not been fixed.


(f)            For
the purpose of any computation under this Section 6, on any determination date,
the Current Market Price Per Common Share shall be deemed to be the average
(weighted by daily trading volume) of the Daily Prices (as defined below) per
share of the applicable class of Common Stock for the 20 consecutive trading
days immediately prior to such date.  “Daily Price” means (A) if the shares of
such class of Common Stock are then listed and traded on the New York Stock
Exchange, Inc. (“NYSE”), the
closing price on the NYSE on such day as reported on the NYSE Composite
Transactions Tape; (B) if the shares of such class of Common Stock are then not
listed and traded on the NYSE, the closing price on such day as reported by the
principal national securities exchange on which the shares are listed and
traded; (C) if the shares of such class of Common Stock are then not listed and
traded on the NYSE or any such national securities exchange, the last reported
sale price on such day on the National Market of the National Association of
Securities Dealers, Inc. Automated Quotation System (“NASDAQ”); or (D) if the shares of such
class of Common Stock are then not listed and traded on the NYSE or any
national securities exchange or traded on the NASDAQ National Market, the
average of the highest reported bid and lowest reported asked price on such day
as reported by NASDAQ.  If on any
determination date the shares of such class of Common Stock are not quoted by
any such organization, the Current Market Price Per Common Share shall be the
fair market value of such shares on such determination date as determined by
the Board of Directors.  If the Holder
shall 


 


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object to any determination by the Board of Directors
of the Current Market Price Per Common Share, the Current Market Price Per
Common Share shall be the fair market value per share of the applicable class
of Common Stock as determined by an independent appraiser retained by the
Company at its expense and reasonably acceptable to the Holder.  For purposes of any computation under this
Section 6, the number of shares of Common Stock outstanding at any given time shall
not include shares owned or held by or for the account of the Company.


(g)           No
adjustment in the Exercise Price shall be required unless such adjustment would
require an increase or decrease of at least one percent in such price; provided that any adjustments which by
reason of this paragraph are not required to be made shall be carried forward
and taken into account in any subsequent adjustment.  All calculations under this Section 6 shall be made to the
nearest one tenth of a cent or to the nearest hundredth of a share, as the case
may be.


(h)           In
the event that, at any time as a result of the provisions of this Section 6,
the holder of this Warrant upon subsequent exercise shall become entitled to
receive any shares of capital stock of the Company other than Common Stock, the
number of such other shares so receivable upon exercise of this Warrant shall
thereafter be subject to adjustment from time to time in a manner and on terms
as nearly equivalent as practicable to the provisions contained herein.


(i)            Upon
each adjustment of the Exercise Price as a result of the calculations made in
this Section 6, the number of shares for which this Warrant is exercisable
immediately prior to the making of such adjustment shall thereafter evidence
the right to purchase, at the adjusted Exercise Price, that number of shares of
Common Stock obtained by (i) multiplying the number of shares covered by this
Warrant immediately prior to this adjustment of the number of shares by the
Exercise Price in effect immediately prior to such adjustment of the Exercise
Price and (ii) dividing the product so obtained by the Exercise Price in effect
immediately after such adjustment of the Exercise Price.


(j)            Not
less than 10 nor more than 30 days prior to the record date of any action which
requires an adjustment pursuant to this Section 6, the Company shall file in
the custody of the secretary of the Company at its principal executive office
an officer’s certificate signed by the chairman, president or chief financial
officer of the Company showing the adjusted Exercise Price determined as herein
provided, setting forth in reasonable detail the facts requiring such
adjustment and the computation of such adjustment.  Each such officer’s certificate shall be made available at all
reasonable times for inspection by the Holder and the Company shall, promptly
after such adjustment, mail a copy, by first-class mail, of such
certificate to the Holder.


(k)           The
Holder shall, at its option, be entitled to receive, in lieu of the adjustment
pursuant to this Section 6 otherwise required, on the date of exercise of the
Warrant, the cash, evidences of indebtedness, assets or other property which
such Holder would have been entitled to receive if it had exercised its Warrant
for shares of Common Stock immediately prior to the record date with respect to
such distribution.  The Holder may
exercise its option under this paragraph (k) by written notice to the Company
within fourteen days of its receipt of the certificate of adjustment required
pursuant to paragraph (j) above to be delivered by the Company in connection
with such distribution.


 


 


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7.             Consolidation, Scheme of Arrangement, Amalgamation, or
Sale of Assets.  In case of
any consolidation of the Company with, or amalgamation of the Company into, any
other Person, any amalgamation of another Person into the Company (other than
an amalgamation which does not result in any reclassification, conversion,
exchange or cancellation of outstanding shares of Common Stock), any scheme of
arrangement, or any sale or transfer of all or substantially all of the assets
of the Company or of the Person formed by such consolidation or resulting from
such amalgamation or which acquires such assets, as the case may be, the Holder
shall have the right thereafter to exercise this Warrant for the kind and
amount of securities, cash and other property receivable upon such
consolidation, scheme of arrangement, amalgamation, sale or transfer by a
holder of the number of shares of Common Stock for which this Warrant may have
been exercised immediately prior to such consolidation, scheme of arrangement,
amalgamation, sale or transfer, assuming (i) such holder of Common Stock is not
a Person with which the Company consolidated or into which the Company
amalgamated or which amalgamated into the Company or to which such sale or
transfer was made, as the case may be (“constituent
Person”), or an Affiliate of a constituent Person and (ii) in the
case of a consolidation, amalgamation, sale or transfer which includes an
election as to the consideration to be received by the holders, such holder of
Common Stock failed to exercise its rights of election, as to the kind or
amount of securities, cash and other property receivable upon such consolidation,
amalgamation, sale or transfer (provided that if the kind or amount of
securities, cash and other property receivable upon such consolidation,
amalgamation, sale or transfer is not the same for each share of Common Stock
held immediately prior to such consolidation, amalgamation, sale or transfer by
other than a constituent Person or an Affiliate thereof and in respect of which
such rights of election shall not have been exercised (“non-electing share”), then for the
purpose of this Section the kind and amount of securities, cash and other
property receivable upon such consolidation, amalgamation, sale or transfer by
each non-electing share shall be deemed to be the kind and amount so receivable
per share by a plurality of the non-electing shares).  Adjustments for events subsequent to the
effective date of such a consolidation, amalgamation and sale of assets shall
be as nearly equivalent as may be practicable to the adjustments provided for
in this Warrant.  In any such event,
effective provisions shall be made in the certificate or articles of
incorporation of the resulting or surviving corporation, in any contract of
sale, conveyance, lease or transfer, or otherwise so that the provisions set
forth herein for the protection of the rights of the Holder shall thereafter
continue to be applicable; and the entity whose securities, cash or other
property for which this Warrant shall have become exercisable shall expressly
assume the obligation to deliver, upon exercise, such securities, cash or other
property.  The provisions of this
Section 7 shall similarly apply to successive consolidations, amalgamations,
sales, leases or transfers.


8.             Loss or Destruction of Warrant.  Upon receipt by the Company of evidence
satisfactory to it (in the exercise of its reasonable discretion) of the loss,
theft, destruction or mutilation of this Warrant Certificate, and (in the case
of loss, theft or destruction) of reasonably satisfactory indemnification, and
upon surrender and cancellation of this Warrant Certificate, if mutilated, the
Company shall execute and deliver a new Warrant Certificate of like tenor and
date.


9.             Notices. 
Any notice, demand or delivery authorized by this Warrant Certificate
shall be in writing and shall be given to the Holder or the Company, as the
case may be, at its


 


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address (or facsimile number) set forth below, or such
other address (or facsimile number) as shall have been furnished to the party
giving or making such notice, demand or delivery:


If
to the Company:


AXIS Capital Holdings Limited


106 Pitts Bay Road


Pembroke HM08, Bermuda


Attention:  Andrew Cook


Fax: (441) 296-2600


 


 


With
a copy to:


AXIS Capital Holdings
Limited

106 Pitts Bay Road

Pembroke HM08, Bermuda

Attention:  Carol S. Rivers

Fax: (441) 296-2600


If
to the Holder:


 


 


 


 


 


With a copy to:


 


 


 


 


Each such notice, demand or
delivery shall be effective (i) if given by facsimile, when receipt
acknowledged or (ii) if given by any other means, when received at the address
specified herein.


10.           Rights of the Holder.   Prior to the exercise of any Warrant, the
Holder shall not, by virtue hereof, be entitled to any rights of a shareholder
of the Company, including, without limitation, the right to vote, to receive
dividends or other distributions, to exercise any preemptive right or to
receive any notice of meetings of shareholders or any notice of any proceedings
of the Company except as may be specifically provided for herein.


 


 


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11.           Governing Law.  THIS WARRANT CERTIFICATE AND ALL RIGHTS ARISING HEREUNDER SHALL
BE CONSTRUED AND DETERMINED IN ACCORDANCE WITH THE LAWS OF BERMUDA, AND THE
PERFORMANCE THEREOF SHALL BE GOVERNED AND ENFORCED IN ACCORDANCE WITH SUCH
LAWS.


12.           Amendments; Waivers.  Any provision of this Warrant may be amended
or waived if, and only if, such amendment or waiver is in writing and signed,
in the case of an amendment, by the Holder and the Company, or in the case of a
waiver, by the party against whom the waiver is to be effective.  No failure or delay by either party in
exercising any right, power or privilege hereunder shall operate as a waiver
thereof nor shall any single or partial exercise thereof preclude any other or
further exercise thereof or the exercise of any other right, power or
privilege.  The rights and remedies
herein provided shall be cumulative and not exclusive of any rights or remedies
provided by law.


13.           Entire Agreement; Supersession of Prior Warrant.  The Company and the Holder hereby acknowledge
and agree that this warrant constitutes the entire agreement between them with
respect to the subject matter of this Warrant, and this Warrant shall supersede
all contemporaneous oral and all prior oral and written agreements and
understandings with respect to the subject matter hereof.  For avoidance of doubt, the Company, and the
Holder hereby acknowledge and agree that this Warrant supersedes and replaces
in its entirety the Old Warrant, and the Old Warrant is hereby cancelled and of
no further force or effect. 
Simultaneously with the execution of this Warrant, the Holder has
returned to the Company the original Old Warrant.


 


 


11

















            IN WITNESS
WHEREOF, the Company has duly caused this Warrant to be signed and
attested by its duly authorized officers and to be dated as of July 7, 2003.


	
   

  	
   

  	
  AXIS
  Capital Holdings Limited

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  	
  Andrew
  Cook

  
	
   

  	
   

  	
  Title:

  	
  Chief
  Financial Officer

  



 


 


 


Acknowledged and Agreed:


 


[                              ]


 


 


	
  By:

  	
   

  
	
   

  	
  Name:

  
	
   

  	
  Title:

  



 

















 


WARRANT EXERCISE NOTICE


(To be delivered prior to exercise of the
Warrant 

by execution of the Warrant Exercise Subscription Form)


To:          AXIS Capital Holdings Limited


The undersigned hereby
notifies you of its intention to exercise the Warrant to purchase common
shares, par value $0.0125 per share, of AXIS Capital Holdings Limited (the “Common Stock”).


The undersigned intends to
exercise the Warrant to purchase                  
shares of Common Stock (the “Shares”)
at $_____per Share (the Exercise Price currently in effect pursuant to the
Warrant).  The undersigned intends to
pay the aggregate Exercise Price for the Shares in cash, certified or official
bank or bank cashier’s check (or a combination of cash and check) as indicated
below.


-OR-


The undersigned intends to
exercise the Warrant to purchase [                   ] shares of Common Stock (the “Shares”) and wishes, in lieu of paying the
Exercise Price of $                                per
Share currently in effect pursuant to the Warrant, to deliver shares of Common
Stock having a value calculated by reference to the aggregate Daily Price (as
defined in the Warrant) equal to or in excess of the aggregate Exercise Price
for the Shares.


-OR-


The undersigned intends to
exercise the Warrant to purchase [                   ] shares of Common Stock (the “Shares”) at the Exercise Price of $                                 per share
currently in effect pursuant to the Warrant, and intends to pay $                             of the
aggregate Exercise Price for the Shares in cash, certified or official bank or
bank cashier’s check (or a combination of cash and check) as indicated below,
and to deliver as payment of $                               of the aggregate Exercise Price that number
of shares of Common Stock having a value calculated by reference to the
aggregate Daily Price (as defined in the Warrant) equal to or in excess of such
portion of the aggregate Exercise Price for the Shares.


-OR-


The undersigned intends to
exercise the Warrant to purchase [        
] shares of Common Stock (the “Shares”)
at the Exercise Price of $                
per share currently in effect pursuant to the Warrant and, pursuant to
Section 2(d)(ii) of the Warrant, wishes, in lieu of payment of the Exercise
Price, to receive a number of Shares reduced by the number of shares of Common
Stock having a value calculated by reference to the aggregate Daily Price (as
defined in the Warrant) equal to the aggregate Exercise Price for the Shares.


 


 


A-1

















 


Date:                                                       


	
   

  	
   

  
	
   

  	
  (Signature of Owner)

  
	
   

  	
   

  
	
   

  	
  (Address)

  
	
   

  	
   

  
	
   

  	
  (Address)

  



 


	
  Payment:

  	
  $

  	
   

  	
  cash

  	
   

  	
   

  
	
   

  	
  $

  	
   

  	
  check

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  shares of Common Stock
  having a Daily Price of $________

  	
   

  



 


 


A-2

















 


WARRANT EXERCISE SUBSCRIPTION FORM


(To
be executed only upon exercise of the Warrant

after delivery of Warrant Exercise Notice)


 


To:          AXIS Capital Holdings Limited


The undersigned irrevocably
exercises the Warrant for the purchase of [                     ] common shares  (the “Shares”), par
value $0.0125 per share, of AXIS Capital Holdings Limited (the “Company”) at $                               per Share (the Exercise Price
currently in effect pursuant to the Warrant) and herewith makes payment of $                         (such payment being made in cash or by
certified or official bank or bank cashier’s check payable to the order of the
Company or by any permitted combination of such cash or check), all on the
terms and conditions specified in the within Warrant Certificate, surrenders
this Warrant Certificate and all right, title and interest therein to the
Company and directs that the Shares deliverable upon the exercise of this
Warrant be registered or placed in the name and at the address specified below
and delivered thereto.


-OR-


The undersigned irrevocably
exercises the Warrant for the purchase of [              ]  common
shares (the “Shares”), par value
$0.0125 per share (the “Common Stock”),
of AXIS Capital Holdings Limited (the “Company”)
at $                   per share
(the Exercise Price currently in effect pursuant to the Warrant), such payment
being made by delivering that number of shares of Common Stock having a value
calculated by reference to the aggregate Daily Price (as defined in the
Warrant) equal to or in excess of the aggregate Exercise Price for the Shares,
all on the terms and conditions specified in the Warrant Certificate,
surrenders this Warrant Certificate and all right, title and interest therein
to the Company and directs that the Shares deliverable upon the exercise of
this Warrant be registered or placed in the name and at the address specified
below and delivered thereto.


-OR-


The undersigned irrevocably
exercises the Warrant for the purchase of 
[       ] common shares  (the “Shares”),
par value $0.0125 per share (the “Common
Stock”), of AXIS Capital Holdings Limited (the “Company”) at $                          per Share (the Exercise Price currently
in effect pursuant to the Warrant), and herewith makes payment of $                             of the
aggregate Exercise Price for the Shares in cash, certified or official bank or
bank cashier’s check (or a combination of cash and check), and herewith
delivers as payment of $                    
of the aggregate Exercise Price that number of shares of Common Stock having a
value calculated by reference to the aggregate Daily Price (as defined in the
Warrant) equal to or in excess of such portion of the aggregate Exercise Price
for the Shares, all on the terms and conditions specified in the Warrant
Certificate, surrenders this Warrant Certificate and all right, title and
interest therein to the Company and directs that the Shares deliverable upon
the exercise of this Warrant be registered or placed in the name and at the
address specified below and delivered thereto.


 


 


A-3

















 


-OR-


The undersigned irrevocably
exercises the Warrant for the purchase of [                      ] common shares (the “Shares”), par value $0.0125 per share (the
“Common Stock”), of AXIS Capital
Holdings Limited (the “Company”)
at $                     per Share
(the Exercise Price currently in effect pursuant to the Warrant); provided
that, pursuant to Section 2(d)(ii) of the Warrant, in lieu of payment of $                    , the undersigned will
receive a number of Shares reduced by a number of shares of Common Stock having
a value calculated by reference to the aggregate Daily Price (as defined in the
Warrant) equal to the aggregate Exercise Price for the Shares, all on the terms
and conditions specified in the Warrant Certificate, surrenders this Warrant
Certificate and all right, title and interest therein to the Company and
directs that the Shares deliverable upon the exercise of this Warrant be
registered or placed in the name and at the address specified below and
delivered thereto.


 


 


Date:                                                       


	
   

  	
   

  
	
   

  	
  (Signature of Owner)

  
	
   

  	
   

  
	
   

  	
  (Address)

  
	
   

  	
   

  
	
   

  	
  (Address)

  



 


 


A-4

















 


Securities
and/or check to be issued to:                                                                                                                          


Please
insert social security or identifying number:                                                                                                       


Name:                                                                                                                                                                                     


Street
Address:                                                                                                                                                                    


City,
State and Zip Code:                                                                                                                                                    


Any
unexercised portion of the Warrant evidenced by the within Warrant Certificate
to be issued to:


Please
insert social security or identifying number:                                                                                                       


Name:                                                                                                                                                                                     


Street
Address:                                                                                                                                                                    


City,
State and Zip Code:                                                                                                                                                    


 


A-5












 








 


WARRANT ASSIGNMENT FORM


Dated                                 


FOR
VALUE RECEIVED,                                                                                                                                    hereby
sells,


 


assigns
and transfers unto                                                                                                                 (the
“Assignee”),
                                                                (please
type or print in block letters)


                                                                                                                                                                                                            


(insert address)


its right to purchase up to
[                 ] common shares, par
value $0.0125 per share, of AXIS Capital Holdings Limited (the “Company”)
represented by this Warrant and does hereby irrevocably constitute and appoint
[                      ] as attorney, to
transfer the same on the books of the Company, with full power of substitution
in the premises.


	
   

  	
  Signature:

  	
   

  
	
   

  



 


 


A-6