Document:

<PAGE>

                                                                     Exhibit 4.3

                                DEPOSIT AGREEMENT

                                      among

                                  ACE LIMITED,

                  MELLON INVESTOR SERVICES LLC, as Depositary,

                                       and

                        THE HOLDERS FROM TIME TO TIME OF
                    THE DEPOSITARY RECEIPTS DESCRIBED HEREIN

                                 (May 30, 2003)

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                               TABLE OF CONTENTS
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<S>             <C>                                                                             <C>
                                                                                                Page

ARTICLE I       DEFINITIONS ....................................................................  1

ARTICLE II      FORM OF RECEIPTS, DEPOSIT OF PREFERRED SHARES, EXECUTION AND
                DELIVERY, TRANSFER, SURRENDER AND REDEMPTION OF RECEIPTS .......................  3

  Section 2.01  Form and Transferability of Receipts ...........................................  3

  Section 2.02  Deposit of Preferred Shares; Execution and Delivery of Receipts
                in Respect Thereof .............................................................  5

  Section 2.03  Optional Redemption of Preferred Shares ........................................  6

  Section 2.04  Registration of Transfer of Receipts ...........................................  7

  Section 2.05  Split-ups and Combinations of Receipts .........................................  7

  Section 2.06  Surrender of Receipts and Withdrawal of Preferred Shares .......................  8

  Section 2.07  Limitations on Execution and Delivery, Transfer, Surrender and
                Exchange of Receipts ...........................................................  8

  Section 2.08  Lost Receipts, etc .............................................................  9

  Section 2.09  Cancellation and Destruction of Surrendered Receipts ...........................  9

ARTICLE III     CERTAIN OBLIGATIONS OF HOLDERS OF RECEIPTS AND THE COMPANY .....................  9

  Section 3.01  Filing Proofs, Certificates and Other Information ..............................  9

  Section 3.02  Payment of Fees and Expenses ................................................... 10

  Section 3.03  Representation and Warranty as to Preferred Shares ............................. 10

  Section 3.04  Representation and Warranty as to Receipts and Depositary Shares ............... 10

ARTICLE IV      THE PREFERRED SHARES; NOTICES .................................................. 10

  Section 4.01  Cash Distributions ............................................................. 10

  Section 4.02  Distributions Other Than Cash, Rights, Preferences or Privileges ............... 11

  Section 4.03  Subscription Rights, Preferences or Privileges ................................. 11

  Section 4.04  Notice of Dividends; Fixing of Record Date for Holders of
                Receipts ....................................................................... 12

  Section 4.05  Voting Rights .................................................................. 12

  Section 4.06  Changes Affecting Preferred Shares and Reclassifications,
                Recapitalizations, etc ......................................................... 13

  Section 4.07  Inspection of Reports .......................................................... 14
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                                      -i-

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                               TABLE OF CONTENTS
                                  (continued)

<TABLE>
<S>             <C>                                                                             <C>
                                                                                                Page
  Section 4.08  Lists of Receipt Holders ....................................................... 14

  Section 4.09  Tax and Regulatory Compliance .................................................. 14

  Section 4.10  Withholding .................................................................... 14

ARTICLE V       THE DEPOSITARY, THE DEPOSITARY'S AGENTS, THE REGISTRAR, THE
                TRANSFER AGENT AND THE COMPANY ................................................. 14

  Section 5.01  Maintenance of Offices, Agencies and Transfer Books by the
                Depositary; Registrar .......................................................... 15

  Section 5.02  Prevention of or Delay in Performance by the Depositary, the
                Depositary's Agents, the Registrar or the Company .............................. 15

  Section 5.03  Obligations of the Depositary, the Depositary's Agents, the
                Registrar, the Transfer Agent and the Company .................................. 16

  Section 5.04  Resignation and Removal of the Depositary; Appointment of
                Successor Depositary ........................................................... 18

  Section 5.05  Corporate Notices and Reports .................................................. 19

  Section 5.06  Indemnification by the Company ................................................. 19

  Section 5.07  Fees and Expenses .............................................................. 19

ARTICLE VI      AMENDMENT AND TERMINATION ...................................................... 20

  Section 6.01  Amendment ...................................................................... 20

  Section 6.02  Termination .................................................................... 20

ARTICLE VII     MISCELLANEOUS .................................................................. 21

  Section 7.01  Counterparts ................................................................... 21

  Section 7.02  Exclusive Benefit of Parties ................................................... 21

  Section 7.03  Invalidity of Provisions ....................................................... 21

  Section 7.04  Notices ........................................................................ 21

  Section 7.05  Depositary's Agents ............................................................ 22

  Section 7.06  Holders of Receipts Are Parties ................................................ 22

  Section 7.07  Governing Law .................................................................. 22

  Section 7.08  Inspection of Deposit Agreement ................................................ 22

  Section 7.09  Headings ....................................................................... 23
</TABLE>

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                                DEPOSIT AGREEMENT

     This DEPOSIT AGREEMENT, dated as of May 30, 2003, is entered into by and
among ACE Limited, a Cayman Islands company (the "Company"), Mellon Investor
Services LLC, a New Jersey limited liability company ("MIS"), as Depositary, and
the holders from time to time of the Receipts (as hereinafter defined) issued
hereunder.

     WHEREAS, it is desired to provide, as hereinafter set forth in this Deposit
Agreement, for the deposit of shares of 7.80% Cumulative Redeemable Preferred
Shares, Series C, par value $1.00, of the Company ("Preferred Shares") with the
Depositary for the purposes set forth in this Deposit Agreement and for the
issuance hereunder of Receipts evidencing Depositary Shares (as hereinafter
defined) representing a fractional interest in the Preferred Shares deposited;
and

     WHEREAS, the Receipts are to be substantially in the form of Exhibit A
annexed hereto, with appropriate insertions, modifications and omissions, as
hereinafter provided in this Deposit Agreement;

     NOW, THEREFORE, in consideration of the premises, the parties hereto agree
as follows:

                                    ARTICLE I

                                   Definitions

     The following definitions shall for all purposes, unless otherwise
indicated, apply to the respective terms used in this Deposit Agreement and the
Receipts:

     "Affiliate" shall mean, with respect to any person or entity, any person or
entity directly or indirectly controlling, controlled by, or under common
control with, such other person or entity. For the purpose of this definition,
"controlling," "controlled by" or "under common control with," mean the
ownership, direct or indirect, of the power to direct or cause the direction of
the operation or management and policies of a person or entity, whether through
the ownership or control of voting interests, by contract or otherwise.

     "Articles of Association" shall mean the Amended and Restated Articles of
Association of the Company, as amended and restated from time to time.

     "cash redemption date" shall have the meaning set forth in Section 2.03(a).

     "Company" shall have the meaning set forth in the preamble hereto.

     "Deposit Agreement" shall mean this Deposit Agreement, as amended or
supplemented from time to time.

     "Depositary" shall mean MIS, and any successor Depositary hereunder.

     "Depositary Shares" shall mean a fractional interest of one-tenth of a
Preferred Share deposited with the Depositary hereunder and the same
proportionate interest in any and all other

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property received by the Depositary in respect to such Preferred Shares and held
under this Deposit Agreement, all as evidenced by the Receipts issued hereunder.
Subject to the terms of this Deposit Agreement, each owner of a Depositary Share
is entitled, proportionately, to all the rights, preferences and privileges of
the Preferred Share represented by such Depositary Share, including the
dividend, voting, redemption and liquidation rights contained in the Special
Resolutions, and to the benefits of all obligations and duties of the Company in
respect of the Preferred Shares under the Articles of Association and Memorandum
of Association.

     "Depositary's Agent" shall mean an agent appointed by the Depositary
pursuant to Section 7.05.

     "Depositary's Office" shall mean the office of the Depositary at which at
any particular time its business in respect of matters governed by this Deposit
Agreement shall be administered, which at the date hereof is located at 85
Challenger Road, Ridgefield Park, NJ 07660.

     "Dollars" or "$" shall mean U.S. dollars.

     "DTC" means The Depository Trust Company.

     "DTC Receipt" has the meaning set forth in Section 2.01(a).

     "Memorandum of Association" shall mean the Memorandum of Association of the
Company, as amended and restated from time to time.

     "Preferred Shares" shall have the meaning set forth in the recitals hereto.

     "Receipt" shall mean a Depositary Receipt issued hereunder to evidence one
or more Depositary Shares, whether in definitive or temporary form,
substantially in the form set forth as Exhibit A hereto. If the context so
requires, the term "Receipt" shall be deemed to include the DTC Receipt (as
defined in Section 2.01(a) hereof).

     "record date" shall mean the date fixed pursuant to Section 4.04.

     "record holder" of "holder" as applied to a Receipt shall mean the person
in whose name a Receipt is registered on the books of the Registrar maintained
for such purpose.

     "Registrar" shall mean MIS, who is appointed to register ownership and
transfers of Receipts, Depositary Shares and the deposited Preferred Shares, as
the case may be, as herein provided.

     "Securities Act" shall mean the Securities Act of 1933, as amended.

     "Special Resolution" shall mean the resolutions adopted by the special
committee of the Board of Directors of the Company in accordance with the
Articles of Association and establishing the Preferred Shares as a series of
preferred shares of the Company and evidencing the preferences and rights of
such Preferred Shares.

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     "Transfer Agent" shall mean MIS, who is appointed to serve as transfer
agent for the Receipts, Depositary Shares and the deposited Preferred Shares, as
the case may be, as herein provided.

                                   ARTICLE II

          Form of Receipts, Deposit of Preferred Shares, Execution and
            Delivery, Transfer, Surrender and Redemption of Receipts

     Section 2.01 Form and Transferability of Receipts. (a) The Company and the
Depositary shall make application to DTC for acceptance of all or a portion of
the Receipts for its book-entry settlement system. The Company hereby appoints
the Depositary acting through any authorized officer thereof as its
attorney-in-fact, with full power to delegate, for purposes of executing any
agreements, certifications or other instruments or documents necessary or
desirable in order to effect the acceptance of such Receipts for DTC
eligibility. So long as the Receipts are eligible for book-entry settlement with
DTC, unless otherwise required by law, all Depositary Shares to be traded on the
New York Stock Exchange with book-entry settlement through DTC shall be
represented by a single receipt (the "DTC Receipt"), which shall be deposited
with DTC (or its designee) evidencing all such Depositary Shares and registered
in the name of the nominee of DTC (initially expected to be Cede & Co.). The
Depositary or such other entity as is agreed to by DTC may hold the DTC Receipt
as custodian for DTC. Ownership of beneficial interests in the DTC Receipt shall
be shown on, and the transfer of such ownership shall be effected through,
records maintained by (i) DTC or its nominee for such DTC Receipt, or (ii)
institutions that have accounts with DTC.

     (b) Notwithstanding the foregoing, the DTC Receipt shall be exchangeable
for definitive Receipts only if (i) DTC notifies the Company at any time that it
is unwilling or unable to continue to make its book-entry settlement system
available for the Receipts and a successor to DTC is not appointed by the
Company within 90 days of the date the Company is so informed in writing, (ii)
DTC notifies the Company at any time that it has ceased to be a clearing agency
registered under applicable law and a successor to DTC is not appointed by the
Company within 90 days of the date the Company is so informed in writing or
(iii) the Company executes and delivers to DTC, with a copy to the Depositary, a
notice to the effect that such DTC Receipt shall be so exchangeable. The Company
shall promptly forward to the Depositary any notice that it receives from DTC as
described in the preceding sentence. If the beneficial owners of interests in
Depositary Shares are entitled to exchange such interests for definitive
Receipts as the result of an event described in clause (i), (ii) or (iii) of the
preceding sentence, then without unnecessary delay but in any event not later
than the earliest date on which such beneficial interests may be so exchanged,
the Depositary shall provide written instructions to DTC to deliver to the
Depositary for cancellation the DTC Receipt, and the Company shall instruct the
Depositary to deliver to the beneficial owners of the Depositary Shares
previously evidenced by the DTC Receipt definitive Receipts in physical form
evidencing such Depositary Shares. Such definitive Receipts shall be in
substantially the form annexed hereto as Exhibit A, with appropriate insertions,
modifications and omissions, as hereafter provided.

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     (c) The beneficial owners of Depositary Shares shall not, except as stated
above with respect to Depositary Shares in book-entry form issued in exchange
for the DTC Receipt, be entitled to receive Receipts in physical, certificated
form as herein provided.

     (d) Definitive Receipts shall be engraved or printed or lithographed on
steel-engraved borders by the Company and shall be substantially in the form set
forth in Exhibit A annexed to this Deposit Agreement, with appropriate
insertions, modifications and omissions, as hereinafter provided. The DTC
Receipt shall bear such legend or legends as may be required by DTC in order for
it to accept the Depositary Shares for its book-entry settlement system. Pending
the preparation of definitive Receipts, the Depositary, upon the written order
of the Company or any holder of Preferred Shares, as the case may be, delivered
in compliance with Section 2.02, shall execute and deliver temporary Receipts,
which may be printed, lithographed, typewritten, mimeographed or otherwise
substantially of the tenor of the definitive Receipts in lieu of which they are
issued and with such appropriate insertions, omissions, substitutions and other
variations as the Company may determine, as evidenced by a writing delivered to
the Depositary. If temporary Receipts are issued, the Company and the Depositary
will cause definitive Receipts to be prepared without unreasonable delay. After
the preparation of definitive Receipts, the temporary Receipts shall be
exchangeable for definitive Receipts upon surrender of the temporary Receipts at
the Depositary's Office or such offices, if any, as the Depositary may
designate, without charge to the holder. Upon surrender for cancellation of any
one or more temporary Receipts, the Depositary shall execute and deliver in
exchange therefor definitive Receipts representing the same number of Depositary
Shares as represented by the surrendered temporary Receipt or Receipts;
provided, the Depositary has been provided with all necessary information that
it may request in order to execute and deliver such definitive Receipts. Such
exchange shall be made at the Company's expense and without any charge to the
holder. Until so exchanged, the temporary Receipts shall in all respects be
entitled to the same benefits under this Deposit Agreement, and with respect to
the Preferred Shares, as definitive Receipts.

     (e) Receipts shall be executed by the Depositary by the manual or facsimile
signature of a duly authorized signatory of the Depositary; provided, that if a
Registrar (other than the Depositary) shall have been appointed then such
Receipts shall also be countersigned by manual or facsimile signature of a duly
authorized signatory of the Registrar. No Receipt shall be entitled to any
benefits under this Deposit Agreement or be valid or obligatory for any purpose
unless it shall have been executed as provided in the preceding sentence. The
Depositary or the Registrar, as applicable, shall record on its books each
Receipt so executed as provided above and delivered as hereinafter provided.
Receipts bearing the signature of anyone who was a duly authorized officer of
the Depositary shall bind the Depositary, notwithstanding that such person has
ceased to hold such office prior to the delivery of the Receipts.

     (f) Receipts shall be in denominations of any number of whole Depositary
Shares and the Company shall provide the Depositary with a writing containing
the calculations therefor. All Receipts shall be dated the date of their
issuance.

     (g) Receipts may be endorsed with or have incorporated in the text thereof
such legends or recitals or changes not inconsistent with the provisions of this
Deposit Agreement as may be required by the Company or the Depositary or
required to comply with any applicable law or regulation or with the rules and
regulations of any securities exchange upon which the

                                       4

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Preferred Shares, the Depositary Shares or the Receipts may be listed or to
conform with any usage with respect thereto, or to indicate any special
limitations or restrictions to which any particular Receipts are subject.

     (h) Title to any Receipt (and the beneficial ownership of the Depositary
Shares evidenced by such Receipt) that is properly endorsed or accompanied by a
properly executed instrument of transfer or endorsement shall be transferable by
delivery with the same effect as in the case of a negotiable instrument;
provided, however, that until transfer of a Receipt shall be registered on the
books of the Depositary as provided in Section 2.04, the Depositary may,
notwithstanding any notice to the contrary, treat the record holder thereof at
such time as the absolute owner thereof for all purposes, including for the
purpose of determining the person entitled to (i) distribution of dividend or
other distributions or (ii) any notice provided for in this Deposit Agreement.

     Section 2.02 Deposit of Preferred Shares; Execution and Delivery of
Receipts in Respect Thereof. (a) Subject to the terms and conditions of this
Deposit Agreement, the Company or any holder of Preferred Shares may from time
to time deposit Preferred Shares under this Deposit Agreement by delivery to the
Depositary of a certificate or certificates for the Preferred Shares to be
deposited, accompanied by a duly executed instrument of transfer or endorsement,
in form satisfactory to the Depositary, together with all such certifications as
may be required by the Depositary in accordance with the provisions of this
Deposit Agreement, and together with a written order of the Company or such
holder, as the case may be, directing the Depositary to execute and deliver to,
or upon the written order of, the person or persons stated in such order a
Receipt or Receipts for, and specifying, the number of whole Depositary Shares
representing such deposited Preferred Shares. The Company hereby appoints the
Depositary as the Registrar and Transfer Agent for the Preferred Shares
deposited hereunder, and the Depositary hereby accepts such appointment and, as
such, will reflect changes in the number of deposited Preferred Shares
(including any fractional shares) held by it by notation, book-entry or other
appropriate method.

     (b) If required by the Depositary, Preferred Shares presented for deposit
by the Company at any time, whether or not the register of shareholders of the
Company is closed, shall also be accompanied by an agreement or assignment, or
other instrument satisfactory to the Depositary, that will provide for the
prompt transfer to the Depositary or its nominee of any dividend or any right to
subscribe for additional Preferred Shares or to receive other property that any
person in whose name the Preferred Shares is or has been registered may
thereafter receive upon or in respect of such deposited Preferred Shares, or in
lieu thereof such agreement of indemnity or other agreement as shall be
satisfactory to the Depositary.

     (c) Upon receipt by the Depositary of a certificate or certificates for
Preferred Shares deposited in accordance with the provisions of this Section
2.02, together with the other documents specified above, and upon proper
registration of the Preferred Shares on the books of the Company in the name of
the Depositary or its nominee, the Depositary, subject to the terms and
conditions of this Deposit Agreement, shall execute and deliver to, or upon the
order of, the person or persons in the written order delivered to the Depositary
referred to in Section 2.02(a), a Receipt or Receipts for the number of whole
Depositary Shares representing the Preferred Shares so deposited and registered
in such name or as may be requested by such person or persons. The

                                       5

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Depositary shall execute and deliver such Receipt or Receipts at the
Depositary's Office or such other offices, if any, as the Depositary may
designate, except that, at the request, risk and expense of any person
requesting such delivery, such delivery may be made at such other place as may
be designated by such person.

     (d) Other than in the case of splits, combinations or other
reclassifications affecting the Preferred Shares, or in the case of dividends or
other distributions of Preferred Shares, if any, there shall be deposited
hereunder not more than the number of Preferred Shares as set forth in the
Special Resolutions or the Memorandum of Association. The Depositary shall have
no duty or obligation to monitor the number of Preferred Shares to be deposited
for purposes of this Section 2.02(d).

     (e) The Company shall deliver to the Depositary from time to time such
quantities of Receipts as shall be necessary to enable the Depositary to perform
its obligations under this Deposit Agreement.

     Section 2.03 Optional Redemption of Preferred Shares. (a) Whenever the
Company shall elect to redeem deposited Preferred Shares for cash in accordance
with the provisions of the Special Resolutions, it shall (unless otherwise
agreed in writing with the Depositary) give the Depositary not less than 60
days' prior written notice of the date of such proposed redemption and of the
number of such Preferred Shares held by the Depositary to be so redeemed and the
applicable redemption price, determined pursuant to the Special Resolution,
including the amount, if any, of accrued and unpaid dividends to the date of
such redemption. The Depositary shall mail, first-class postage prepaid, notice
of the redemption of Preferred Shares and the proposed simultaneous redemption
of the Depositary Shares representing the Preferred Shares to be redeemed, not
less than 30 and not more than 60 days prior to the date fixed for redemption of
such Preferred Shares and Depositary Shares (the "cash redemption date"), to the
holders of record on the record date fixed for such redemption pursuant to
Section 4.04 of the Receipts evidencing the Depositary Shares to be so redeemed,
at the addresses of such holders as the same appear on the records of the
Depositary; but neither failure to mail any such notice to one or more such
holders nor any defect in any such notice shall affect the sufficiency of the
proceedings for redemption as to other holders. The Company shall provide the
Depositary with such notice, and each such notice shall state: the cash
redemption date; the cash redemption price; the number of deposited Preferred
Shares and Depositary Shares to be redeemed; if fewer than all the Depositary
Shares held by any holder are to be redeemed, the number of such Depositary
Shares held by such holder to be so redeemed; the place or places where Receipts
evidencing Depositary Shares to be redeemed are to be surrendered for payment of
the cash redemption price; and that from and after the cash redemption date
dividends in respect of the Preferred Shares represented by the Depositary
Shares to be redeemed will cease to accrue. If fewer than all the outstanding
Depositary Shares are to be redeemed, the Depositary Shares to be redeemed shall
be selected by lot or pro rata (as nearly as may be practicable without creating
fractional Depositary Shares) or by any other equitable method determined by the
Company (as set forth in a writing given to the Depositary). The Company shall
also cause notice of redemption to be published in a newspaper of general
circulation in the City of New York at least once a week for two successive
weeks commencing not less than 30 days nor more than 60 days prior to the cash
redemption date. On any cash redemption date, upon the written request of the
Company, the Depositary shall surrender the certificate or certificates held by
the Depositary

                                       6

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evidencing the number of shares of Preferred Shares to be redeemed in the manner
specified in the notice of redemption provided by the Company pursuant to the
Special Resolutions.

     (b) In the event that notice of redemption has been made as described in
Section 2.03(a) and the Company shall then have paid in full to the Depositary
the cash redemption price determined pursuant to the Special Resolutions for the
Preferred Shares deposited with the Depositary to be redeemed (including any
accrued and unpaid dividends to the date of redemption), the Depositary shall
redeem the number of Depositary Shares representing such Preferred Shares so
called for redemption by the Company and from and after the cash redemption date
(unless the Company shall have failed to redeem the Preferred Shares to be
redeemed by it as set forth in the Company's notice provided for in Section
2.03(a)), all dividends in respect of the Preferred Shares called for redemption
shall cease to accrue, the Depositary Shares called for redemption shall be
deemed no longer to be outstanding and all rights of the holders of Receipts
evidencing such Depositary Shares (except the right to receive the cash
redemption price and any money or other property to which holders of such
Receipts were entitled upon such redemption) shall, to the extent of such
Depositary Shares, cease and terminate. Upon surrender in accordance with said
notice of the Receipts evidencing such Depositary Shares (properly endorsed or
assigned for transfer), such Depositary Shares shall be redeemed at a cash
redemption price determined pursuant to the Special Resolutions per Depositary
Share plus any other money and other property payable in respect of such
Preferred Shares. The foregoing shall be further subject to the terms and
conditions of the Special Resolutions.

     (c) If fewer than all the Depositary Shares evidenced by a Receipt are
called for redemption, the Depositary will deliver to the holder of such Receipt
upon its surrender to the Depositary, together with payment of the cash
redemption price for, and all other amounts payable in respect of, the
Depositary Shares called for redemption, a new Receipt evidencing the Depositary
Shares evidenced by such prior Receipt and not called for redemption.

     Section 2.04 Registration of Transfer of Receipts. The Company hereby
appoints the Depositary as the Registrar and Transfer Agent for the Receipts,
and the Depositary hereby accepts such appointment and, as such, shall register
on its books from time to time transfers of Receipts upon any surrender thereof
by the holder, in person or by duly authorized attorney, properly endorsed or
accompanied by a properly executed instrument of transfer or endorsement,
together with evidence of the payment of any applicable taxes or governmental
charges as may be required by law. Upon such surrender, the Depositary shall
execute a new Receipt or Receipts evidencing the same aggregate number of
Depositary Shares as those evidenced by the Receipt or Receipts surrendered and
deliver such new Receipt or Receipts to or upon the order of the person entitled
thereto.

     Section 2.05 Split-ups and Combinations of Receipts. Upon surrender of a
Receipt or Receipts at the Depositary's Office or at such other offices as it
may designate for the purpose of effecting a split-up or combination of such
Receipt or Receipts, and subject to the terms and conditions of this Deposit
Agreement, the Depositary shall execute and deliver a new Receipt or Receipts in
the authorized denominations requested, evidencing the same aggregate number of
Depositary Shares evidenced by the Receipt or Receipts surrendered.

                                       7

<PAGE>

     Section 2.06 Surrender of Receipts and Withdrawal of Preferred Shares. (a)
Any holder of a Receipt or Receipts may withdraw any or all of the deposited
Preferred Shares represented by the Depositary Shares evidenced by such Receipt
or Receipts and all money and other property, if any, represented by such
Depositary Shares by surrendering such Receipt or Receipts at the Depositary's
Office or at such other office as the Depositary may designate for such
withdrawals, provided that a holder of a Receipt or Receipts may not withdraw
such Preferred Shares (or money and other property, if any, represented thereby)
which have previously been called for redemption. After such surrender and upon
written instructions from the holder of such Receipt or Receipts, without
unreasonable delay (provided that the Company has provided the Depositary with
all necessary documentation and a sufficient amount of cash), the Depositary
shall deliver to such holder, or to the person or persons designated by such
holder as hereinafter provided, the number of whole Preferred Shares and all
such money and other property, if any, represented by the Depositary Shares
evidenced by the Receipt or Receipts so surrendered for withdrawal. Holders of
such whole Preferred Shares will not thereafter be entitled to deposit such
Preferred Shares hereunder or to receive Depositary Shares therefor. If the
Receipt or Receipts delivered by the holder to the Depositary in connection with
such withdrawal shall evidence a number of Depositary Shares in excess of the
number of Depositary Shares representing the number of whole deposited Preferred
Shares to be withdrawn, the Depositary shall at the same time, in addition to
such number of whole deposited Preferred Shares and such money and other
property, if any, to be withdrawn, deliver to such holder upon the holder's
written order, a new Receipt or Receipts evidencing such excess number of
Depositary Shares. In no event will fractional Preferred Shares be delivered
upon surrender of Receipts. Delivery of such Preferred Shares and such money and
other property being withdrawn may be made by the delivery of such certificates,
documents of title and other instruments as the Depositary may deem appropriate,
which, if required by the Depositary, shall be properly endorsed or accompanied
by proper instruments of transfer.

     (b) If the deposited Preferred Shares and the money and other property
being withdrawn are to be delivered to a person or persons other than the record
holder of the Receipt or Receipts being surrendered for withdrawal of Preferred
Shares, such holder shall execute and deliver to the Depositary a written order
so directing the Depositary and the Depositary may require that the Receipt or
Receipts surrendered by such holder for withdrawal of such Preferred Shares be
properly endorsed in blank or accompanied by a properly executed instrument of
transfer or endorsement in blank and that the signature on such instrument of
transfer be guaranteed by an eligible guarantor institution pursuant to Rule
17Ad-15 of the Securities Exchange Act of 1934, as amended.

     (c) Delivery of the Preferred Shares and the money and other property, if
any, represented by Receipts surrendered for withdrawal shall be made by the
Depositary at the Depositary's Office, except that, at the request, risk and
expense of the holder surrendering such Receipt or Receipts and for the account
of the holder thereof, such delivery may be made at such other place as may be
designed by such holder.

     Section 2.07 Limitations on Execution and Delivery, Transfer, Surrender and
Exchange of Receipts. (a) As a condition precedent to the execution and
delivery, transfer, split-up, combination, surrender or exchange of any Receipt,
the Depositary, any of the Depositary's Agents or the Company may require any or
all of the following: (i) payment to it of a sum

                                       8

<PAGE>

sufficient for the payment (or, in the event that the Company shall have made
such payment, the reimbursement to it) of any tax or other governmental charge
with respect thereto (including any such tax or charge with respect to the
Preferred Shares being deposited or withdrawn); (ii) the production of proof
satisfactory to it as to the identity and genuineness of any signature (or the
authority of any signature); and (iii) compliance with such regulations, if any,
as the Depositary or the Company may establish consistent with the provisions of
this Deposit Agreement as may be required by any securities exchange upon which
the deposited Preferred Shares, the Depositary Shares or the Receipts may be
included for quotation or listed.

     (b) The deposit of Preferred Shares may be refused, the delivery of
Receipts against Preferred Shares may be suspended, the transfer of Receipts may
be refused and the transfer, split-up, combination, surrender or exchange of
outstanding Receipts may be suspended (i) during any period when the register of
shareholders of the Company is closed or (ii) if any such action is deemed
necessary or advisable by the Depositary, any of the Depositary's Agents or the
Company at any time or from time to time because of any requirement of law or of
any government or governmental body or commission or under any provision of this
Deposit Agreement.

     Section 2.08 Lost Receipts, etc. In case any Receipt shall be mutilated,
destroyed, lost or stolen, the Depositary in its discretion may execute and
deliver a Receipt of like form and tenor in exchange and substitution for such
mutilated Receipt, or in lieu of and in substitution for such destroyed, lost or
stolen Receipt, provided that the holder thereof provides the Depositary with
(a) evidence reasonably satisfactory to the Depositary of such destruction, loss
or theft of such Receipt, of the authenticity thereof and of his or her
ownership thereof, including, without limitation, an affidavit of loss, (b)
indemnification satisfactory to the Depositary and the Company, including,
without limitation, a bond of indemnity and (c) payment of any expense
(including fees, charges and expenses of the Depositary and its agents and
counsel) in connection with such execution and delivery.

     Section 2.09 Cancellation and Destruction of Surrendered Receipts. All
Receipts surrendered to the Depositary or any Depositary's Agent shall be
canceled by the Depositary. Except as prohibited by applicable law or
regulation, the Depositary is authorized to destroy all Receipts so canceled.

                                  ARTICLE III

           Certain Obligations of Holders of Receipts and the Company

     Section 3.01 Filing Proofs, Certificates and Other Information. Any holder
of a Receipt may be required from time to time to file such proof of residence
or other information, to execute such certificates and to make such
representations and warranties as the Depositary or the Company may reasonably
deem necessary or proper. The Depositary or the Company may withhold the
delivery, delay the transfer, redemption or exchange, of any Receipt or the
withdrawal of the Preferred Shares represented by the Depositary Shares
evidenced by any Receipt, the distribution of any dividend or other distribution
or the sale of any rights or of the proceeds thereof, until such proof or other
information is filed, or such certificates are executed or such representations
and warranties are made.

                                       9

<PAGE>

     Section 3.02 Payment of Fees and Expenses. Holders of Receipts shall be
obligated to make payments to the Depositary of certain fees and expenses, as
provided in Section 5.07. Transfer of any Receipt or any withdrawal of Preferred
Shares and all money or other property, if any, represented by the Depositary
Shares evidenced by such Receipt may be refused until any such payment due is
made, and any dividends, interest payments or other distributions may be
withheld or any part of or all the Preferred Shares or other property
represented by the Depositary Shares evidenced by such Receipt and not
theretofor sold may be sold for the account of the holder thereof (after
attempting by reasonable means to notify such holder prior to such sale), and
such dividends, interest payments or other distributions or the proceeds of any
such sale may be applied to any payment of such fees or expenses, the holder of
such Receipt remaining liable for any deficiency.

     Section 3.03 Representation and Warranty as to Preferred Shares. The
Company hereby represents and warrants that the Preferred Shares, when issued,
will be validly issued, fully paid and nonassessable. Such representation and
warranty shall survive the deposit of the Preferred Shares and the issuance of
Receipts.

     Section 3.04 Representation and Warranty as to Receipts and Depositary
Shares. The Company hereby represents and warrants that the Receipts, when
issued, will evidence legal and valid interests in the Depositary Shares and
each Depositary Share will represent a legal and valid one-tenth interest in a
deposited Preferred Share. Such representation and warranty shall survive the
deposit of the Preferred Shares and the issuance of Receipts evidencing the
Depositary Shares.

                                   ARTICLE IV

                          The Preferred Shares; Notices

     Section 4.01 Cash Distributions. Whenever the Depositary shall receive any
cash dividend or other cash distribution on the Preferred Shares, the Depositary
shall, upon written instructions from the Company and subject to Sections 3.01
and 3.02, distribute to record holders of Receipts on the record date fixed
pursuant to Section 4.04 such amounts, as determined by the Company, of such
dividend or distribution as are, as nearly as practicable, in proportion to the
respective numbers of Depositary Shares evidenced by the Receipts held by such
holders; provided, however, that in case the Company or the Depositary shall be
required to withhold and does withhold from any cash dividend or other cash
distribution in respect of the Preferred Shares an amount on account of taxes,
the amount made available for distribution or distributed in respect of
Depositary Shares shall be reduced accordingly. The Depositary shall distribute
or make available for distribution, as the case may be and in accordance with
the Company's instructions, such amount as can be distributed without
attributing to any holder of Receipts a fraction of one cent by rounding the
amount of any distribution to the record holder of Receipts to the nearest whole
cent; provided, however, that in the event the Depositary requires an additional
amount in connection with such rounding to avoid the distribution of a fraction
of one cent to any holder, the Depositary shall notify the Company of the amount
necessary and the Company shall promptly deliver such amount to the Depositary.

                                       10

<PAGE>

     Section 4.02 Distributions Other Than Cash, Rights, Preferences or
Privileges. Whenever the Depositary shall receive any distribution other than
cash on the deposited Preferred Shares, the Depositary shall, subject to
Sections 3.01 and 3.02, distribute to record holders of Receipts on the record
date fixed pursuant to Section 4.04 such amounts, as determined by the Company
and set forth in a writing, of the securities or property received by it as are,
as nearly as practicable, in proportion to the respective numbers of Depositary
Shares evidenced by the Receipts held by such holders. If the Company determines
such distribution cannot be made proportionately among such record holders, or
if for any other reason (including any requirement that the Company or the
Depositary withhold an amount on account of taxes), or the Company determines
such distribution not to be feasible, then the Company shall adopt such method
as it deems equitable and practicable for the purpose of effecting such
distribution, including the sale (at public or private sale) of the securities
or property received by the Depositary, or any part thereof, at such place or
places and upon such terms as it may deem proper. The net proceeds of any such
sale shall, subject to Sections 3.01 and 3.02, be distributed or made available
for distribution, as the case may be, by the Depositary to record holders of
Receipts as provided by Section 4.01 in the case of a distribution received in
cash. The Company shall not make any distribution of such securities unless the
Company shall have provided an opinion of counsel to the Depositary stating that
such securities have been registered under the Securities Act or that
registration is not required. The Company shall advise the Depositary in writing
of the nature of any property, and if the Depositary in its judgment determines
that it may incur liability by reason of being deemed an owner thereof, the
Depositary shall have the right to refuse such property, but the Depositary
shall assist the Company in determining an appropriate means of distributing
such property.

     Section 4.03 Subscription Rights, Preferences or Privileges. (a) If the
Company shall at any time offer or cause to be offered to the persons in whose
names deposited Preferred Shares are recorded on the books of the Company any
rights, preferences or privileges to subscribe for or to purchase any securities
or any rights, preferences or privileges of any other nature, such rights,
preferences or privileges shall in each such instance be made available by the
Depositary to the record holders of Receipts in such manner as the Company shall
instruct in writing, either by the issue to such record holders of warrants
representing such rights, preferences or privileges or by such other method as
may be approved by the Company in its discretion; provided, however, that (i) if
at the time of issue or offer of any such rights, preferences or privileges the
Company determines that it is not lawful or not feasible to make such rights,
preferences or privileges available to holders of Receipts by the issue of
warrants or otherwise or (ii) if and to the extent so instructed by holders of
Receipts who do not desire to exercise such rights, preferences or privileges,
then the Depositary, if so instructed by Company in writing, and if applicable
laws or the terms of such rights, preferences or privileges permit such
transfer, sell such rights, preferences or privileges at public or private sale,
at such place or places and upon such terms as it may deem proper. The net
proceeds of any such sale shall, subject to Sections 3.01 and 3.02, upon written
notice to the Depositary, be distributed by the Depositary to the record holders
of Receipts entitled thereto as provided by Section 4.01 in the case of a
distribution received in cash. The Company shall not make any distribution of
any such rights, preferences or privileges unless the Company shall have
provided to the Depositary an opinion of counsel stating that the distribution
of such rights, preferences or privileges have been registered under the
Securities Act or that registration is not required.

                                       11

<PAGE>

     (b) If, in order for holders of Receipts to be offered or sold the
securities to which any rights, preferences or privileges relate, registration
under the Securities Act of the securities to which such rights, preferences or
privileges relate is required, the Company agrees that it will promptly file a
registration statement pursuant to the Securities Act with respect to such
rights, preferences or privileges and securities and use its reasonable best
efforts and take all steps available to it to cause such registration statement
to become effective sufficiently in advance of the expiration of such rights,
preferences or privileges to enable such holders to exercise such rights,
preferences or privileges, and the Company shall so notify the Depositary in
writing when such registration statement becomes effective. In no event shall
the Depositary make available to the holders of Receipts any right, preference
or privilege to subscribe for or to purchase any securities unless and until
such a registration statement shall have become effective or unless the offering
and sale of such securities to such holders are exempt from registration under
the provisions of the Securities Act and the Company shall have provided to the
Depositary an opinion of counsel to such effect.

     (c) If any other action under the laws of any jurisdiction or any
governmental or administrative authorization, consent or permit is required in
order for such rights, preferences or privileges to be made available to holders
of Receipts, the Company will use its reasonable best efforts to take such
action or obtain such authorization, consent or permit sufficiently in advance
of the expiration of such rights, preferences or privileges to enable such
holders to exercise such rights, preferences or privileges.

     Section 4.04 Notice of Dividends; Fixing of Record Date for Holders of
Receipts. Whenever any cash dividend or other cash distribution shall become
payable, any distribution other than cash shall be made, or any rights,
preferences or privileges shall at any time be offered, with respect to the
deposited Preferred Shares, or whenever the Depositary shall receive written
notice of (a) any meeting at which holders of such Preferred Shares are entitled
to vote or of which holders of such Preferred Shares are entitled to notice or
(b) any election on the part of the Company to redeem any such Preferred Shares,
the Depositary shall in each such instance fix a record date (which shall be the
same date as the record date fixed by the Company with respect to the Preferred
Shares) for the determination of the holders of Receipts who shall be entitled
to receive such dividend, distribution, rights, preferences or privileges or the
net proceeds of the sale thereof, to give instructions for the exercise of
voting rights at any such meeting or to receive notice of such meeting or the
determination of which Depositary Shares are to be so redeemed.

     Section 4.05 Voting Rights. Upon receipt of written notice of any meeting
at which the holders of deposited Preferred Shares are entitled to vote, the
Depositary shall, as soon as practicable thereafter, mail to the record holders
of Receipts a notice to be provided by the Company and which shall contain (a)
such information as is contained in such notice of meeting, (b) a statement that
the holders of Receipts at the close of business on a specified record date
fixed pursuant to Section 4.04 will be entitled, subject to any applicable law,
to instruct the Depositary as to the exercise of the voting rights pertaining to
the amount of Preferred Shares represented by their respective Depositary Shares
(including an express indication that instructions may be given to the
Depositary to give a discretionary proxy to a person designated by the Company)
and (c) a brief statement as to the manner in which such instructions may be
given. Upon the written request of a holder of Receipts on such record date, the
Depositary shall

                                       12

<PAGE>

vote or cause to be voted the amount of Preferred Shares represented by the
Depositary Shares evidenced by such Receipt in accordance with the instructions
set forth in such request. To the extent any such instructions request the
voting of a fractional interest of a share of deposited Preferred Shares, the
Depositary shall aggregate such interest with all other fractional interests
resulting from requests with the same voting instructions and shall vote the
number of whole votes resulting from such aggregation in accordance with the
instructions received in such requests. Each Preferred Share is entitled to one
vote on all matters as to which the Preferred Shares vote and, accordingly, each
Depositary Share is entitled to one-tenth of a vote on such matters. The Company
hereby agrees to take all reasonable action that may be deemed necessary by the
Depositary in order to enable the Depositary to vote such Preferred Shares or
cause such Preferred Shares to be voted. In the absence of specific instructions
from the holder of a Receipt, the Depositary will abstain from voting to the
extent of the Preferred Shares represented by the Depositary Shares evidenced by
such Receipt. The Depositary shall not be required to exercise discretion in
voting any Preferred Shares represented by the Depositary Shares evidenced by
such Receipt.

     Section 4.06 Changes Affecting Preferred Shares and Reclassifications,
Recapitalizations, etc. Upon any change in par or stated value, split-up,
combination or any other reclassification of the Preferred Shares, or upon any
recapitalization, reorganization, merger, amalgamation or consolidation
affecting the Company or to which it is a party or sale of all or substantially
all of the Company's assets, the Depositary shall, upon the written instructions
of the Company, (a) make such adjustments as are certified by the Company in (i)
the fraction of an interest represented by one Depositary Share in one Preferred
Share and (ii) the ratio of the redemption price per Depositary Share to the
redemption price of a Preferred Share, in each case as may be necessary to fully
reflect the effects of such change in par or stated value, split-up, combination
or other reclassification, or of such recapitalization, reorganization, merger,
amalgamation, consolidation or sale and (b) treat any shares or other securities
or property (including cash) that shall be received by the Depositary in
exchange for or upon conversion of or in respect of the Preferred Shares as new
deposited property under this Deposit Agreement, and Receipts then outstanding
shall thereafter represent the proportionate interests of holders thereof in the
new deposited property so received in exchange for or upon conversion or in
respect of such Preferred Shares. In any such case the Depositary shall, upon
the written instructions of the Company, execute and deliver additional
Receipts, or may call for the surrender of all outstanding Receipts to be
exchanged for new Receipts specifically describing such new deposited property.
Anything to the contrary herein notwithstanding, holders of Receipts shall have
the right from and after the effective date of any such change in par or stated
value, split-up, combination or other reclassification of the Preferred Shares
or any such recapitalization, reorganization, merger, amalgamation or
consolidation or sale of substantially all the assets of the Company to
surrender such Receipts to the Depositary with written instructions to convert,
exchange or surrender the Preferred Shares represented thereby only into or for,
as the case may be, the kind and amount of Preferred Shares and other securities
and property and cash into which the Preferred Shares evidenced by such Receipts
might have been converted or for which such Preferred Shares might have been
exchanged or surrendered immediately prior to the effective date of such
transaction. The Company shall cause an effective provision to be made in the
corporate charter of the resulting or surviving corporation (if other than the
Company) for protection of such rights as may be applicable upon exchange of the
deposited Preferred Shares for securities or property or cash of the surviving
corporation in

                                       13

<PAGE>

connection with the transactions set forth above. The Company shall cause any
such surviving corporation (if other than the Company) expressly to assume the
obligations of the Company hereunder.

     Section 4.07 Inspection of Reports. The Depositary shall make available for
inspection by holders of Receipts at the Depositary's Office and at such other
places as it may from time to time deem advisable during normal business hours,
any reports and communications received from the Company that are both received
by the Depositary as the holder of the Preferred Shares and made generally
available to the holders of the Preferred Shares. In addition, the Depositary
shall transmit certain notices and reports to the holders of Receipts as
provided in Section 5.05.

     Section 4.08 Lists of Receipt Holders. Promptly upon written request from
time to time by the Company, the Depositary shall furnish to the Company a list,
as of a recent date specified by the Company, of the names, addresses and
holdings of Depositary Shares of all persons in whose names Receipts are
registered on the books of the Depositary.

     Section 4.09 Tax and Regulatory Compliance. The Depositary shall be
responsible for (a) preparation and mailing of 1099 forms for all open and
closed accounts, (b) foreign tax withholding, (c) withholding 31% (or any
withholding as may be required at the then applicable rate) of dividends from
holders of Receipts subject to back-up withholding, (d) mailing W-9 forms to new
holders of Receipts without a certified taxpayer identification number, (e)
processing certified W-9 forms, (f) preparation and filing of state information
returns and (g) escheatment services.

     Section 4.10 Withholding. Notwithstanding any other provision of this
Deposit Agreement, in the event that the Depositary determines that any
distribution in property is subject to any tax that the Depositary is obligated
by law to withhold, the Depositary may dispose of all or a portion of such
property in such amounts and in such manner as the Depositary deems necessary
and practicable to pay such taxes, by public or private sale, and the Depositary
shall distribute the net proceeds of any such sale or the balance of any such
property after deduction of such taxes to the holders of Receipts entitled
thereto in proportion to the number of Depositary Shares held by them,
respectively.

                                   ARTICLE V

 The Depositary, the Depositary's Agents, the Registrar, the Transfer Agent
                                 and the Company

     For purposes of Article V herein, "Depositary" shall also mean Registrar
and/or Transfer Agent, as the case may be.

     Section 5.01 Maintenance of Offices, Agencies and Transfer Books by the
Depositary; Registrar. (a) The Depositary shall maintain at the Depositary's
Office facilities for the execution and delivery, transfer, surrender and
exchange, split-up, combination and redemption of Receipts and for the deposit
and withdrawal of Preferred Shares and at the offices of the Depositary's
Agents, if any, facilities for the delivery, transfer, surrender and exchange,
split-up,

                                       14

<PAGE>

combination and redemption of Receipts and for the deposit and withdrawal of
Preferred Shares, all in accordance with the provisions of this Deposit
Agreement.

     (b) The Depositary shall keep books at the Depositary's Office for the
registration and transfer of Receipts, which books at all reasonable times
during normal business hours shall be open for inspection by the record holders
of Receipts as provided by applicable law; provided, that any such holder
requesting to exercise such right shall certify to the Depositary that such
inspection shall be for a proper purpose reasonably related to such person's
interest as an owner of Depositary Shares evidenced by the Receipts. The
Depositary may close such books, at any time or from time to time, when deemed
expedient by it in connection with the performance of its duties hereunder.

     (c) If the Receipts or the Depositary Shares evidenced thereby or the
Preferred Shares represented by such Depositary Shares shall be listed on the
New York Stock Exchange, the Depositary may, with the written approval of the
Company, appoint a Registrar (acceptable to the Company) for registration of
such Receipts or Depositary Shares in accordance with any requirements of such
exchange. Such Registrar (which may be the Depositary if so permitted by the
requirements of such exchange) may be removed and a substitute registrar
appointed by the Depositary upon the written request or with the written
approval of the Company. If the Receipts, such Depositary Shares or such
Preferred Shares are listed on one or more other stock exchanges, the Depositary
will, at the written request and expense of the Company, arrange such facilities
for the delivery, registration, transfer, surrender, redemption and exchange of
such Receipts, such Depositary Shares or such Preferred Shares as may be
required by law or applicable stock exchange regulations.

      Section 5.02 Prevention of or Delay in Performance by the Depositary, the
Depositary's Agents, the Registrar or the Company. Neither the Depositary, any
Depositary's Agent, any Registrar nor the Company shall incur any liability to
any holder of any Receipt or any beneficial owner, if by reason of any provision
of any present or future law, or regulation thereunder, of the United States of
America or of any other governmental authority or, in the case of the Company,
the Depositary, the Depositary's Agent or any Registrar, by reason of any
provision, present or future, of the Company's Articles of Association
(including the Special Resolution adopted in accordance thereto) or Memorandum
of Association or by reason of any act of God or war or other circumstance
beyond the control of the relevant party, the Depositary, any Depositary's
Agent, any Registrar or the Company shall be prevented or forbidden from, or
subject to any penalty on account of, doing or performing any act or thing that
the terms of this Deposit Agreement provide shall be done or performed; nor
shall the Depositary, any Depositary's Agent, any Registrar or the Company incur
any liability to any holder of a Receipt or any beneficial owner (a) by reason
of any nonperformance or delay, caused as aforesaid, in the performance of any
act or thing that the terms of this Deposit Agreement provide shall or may be
done or performed, or (b) by reason of any exercise of, or failure to exercise,
any discretion provided for in this Deposit Agreement.

      Section 5.03 Obligations of the Depositary, the Depositary's Agents, the
Registrar, the Transfer Agent and the Company. (a) Neither the Depositary, any
Depositary's Agent, any Registrar, any Transfer Agent nor the Company assumes
any obligation or shall be subject to any liability under this Deposit Agreement
or any Receipt to holders of Receipts or beneficial owners

                                       15

<PAGE>

other than from acts or omissions arising out of conduct constituting bad faith,
gross negligence or willful misconduct in the performance of such duties (each
as finally determined by a court of competent jurisdiction) as are specifically
set forth in this Deposit Agreement. Any liability of the Depositary, any
Depositary's Agent, any Transfer Agent and any Registrar shall be limited to the
amount of fees paid by the Company hereunder and under no circumstances shall
the Depositary, any Depositary's Agent and any Registrar be liable for any
special, punitive, indirect, incidental or consequential loss or damage of any
kind whatsoever (including, but not limited to, lost profits), even if they have
been advised of the likelihood of such loss or damage and regardless of the form
of action.

     (b) Neither the Depositary, any Depositary's Agent, any Registrar nor the
Company shall be under any obligation to appear in, prosecute or defend any
action, suit or other proceeding in respect of the Preferred Shares, the
Depositary Shares or the Receipts that in its opinion may involve it in expense
or liability, unless indemnity reasonably satisfactory to it against all expense
and liability be furnished as often as may be required.

     (c) Neither the Depositary, any Depositary's Agent, any Registrar nor the
Company shall be liable for any action or any failure to act by it in reliance
upon the advice of legal counsel or accountants, or information provided by any
person presenting Preferred Shares for deposit, any holder of a Receipt or any
other person believed by it to be competent to give such information. The
Depositary, any Depositary's Agent, any Registrar and the Company may each rely
and shall each be authorized and protected in acting upon any written notice,
request, direction or other document believed by it to be genuine and to have
been signed or presented by the proper party or parties.

     (d) In the event the Depositary shall receive conflicting claims, requests
or instructions from any holders of Receipts, on the one hand, and the Company,
on the other hand, the Depositary shall be entitled to act on such claims,
requests or instructions received from the Company and shall be entitled to the
full indemnification set forth in Section 5.06 hereof in connection with any
action so taken. In the event the Depositary believes any ambiguity or
uncertainty exists in any notice, instruction, direction, request or other
communication, paper or document received by the Depositary from the Company
pursuant hereto, the Depositary will promptly notify the Company of the details
of such alleged ambiguity or uncertainty, and may, in its sole discretion,
refrain from taking any action, and shall be fully protected and shall not be
liable in any way to any person for refraining from taking such action, absent
gross negligence or willful misconduct (each as finally determined by court of
competent jurisdiction), unless the Depositary receives written instructions
with respect to such matter signed by the Company which eliminates such
ambiguity or uncertainty to the satisfaction of the Depositary.

     (e) The Depositary shall not be responsible for any failure to carry out
any instruction to vote any of the Preferred Shares or for the manner or effect
of any such vote made, as long as any such action or non-action does not result
from bad faith, gross negligence or willful misconduct of the Depositary (each
as finally determined by a court of competent jurisdiction). The Depositary
undertakes, and any Registrar and Transfer Agent shall be required to undertake,
to perform such duties and only such duties as are specifically set forth in
this Deposit Agreement, and no implied covenants or obligations shall be read
into this Deposit Agreement or imposed upon the Depositary or any Registrar.

                                       16

<PAGE>

     (f) The Depositary shall have no liability to the Company under this
Deposit Agreement other than from acts or omissions by the Depositary or its
agents arising out of conduct constituting bad faith, gross negligence or
willful misconduct (each as finally determined by a court of competent
jurisdiction).

     (g) The Depositary, its parent, affiliates, or subsidiaries, any
Depositary's Agent, and any Registrar or Transfer Agent may own, buy, sell or
deal in any class of securities of the Company and its affiliates and in
Receipts or Depositary Shares or become pecuniarily interested in any
transaction in which the Company or its affiliates may be interested or contract
with or lend money to or otherwise act as fully or as freely as if it were not
the Depositary or the Depositary's Agent hereunder. The Depositary or its
affiliates may also act as transfer agent or registrar of any of the securities
of the Company and its affiliates or act in any other capacity for the Company
or its affiliates.

     (h) It is intended that neither the Depositary nor any Depositary's Agent
shall be deemed to be an "issuer" of the securities under the federal securities
laws or applicable state securities laws, it being expressly understood and
agreed that the Depositary and any Depositary's Agent are acting only in a
ministerial capacity as Depositary for the deposited Preferred Shares; provided,
however, that the Depositary agrees to comply with all information reporting and
withholding requirements applicable to it under law or this Deposit Agreement in
its capacity as Depositary.

     (i) Neither the Depositary (or its officers, directors, employees or
agents) nor any Depositary's Agent makes any representation or has any
responsibility as to the validity of any registration statement pursuant to
which the Depositary Shares may be registered under the Securities Act, the
deposited Preferred Shares, the Depositary Shares, the Receipts (except its
countersignature thereon) or any instruments referred to therein or herein, or
as to the correctness of any statement made in any such registration statement
or herein.

     (j) The Company agrees that it will register the issuance of the Preferred
Shares and the Depositary Shares to the extent required by the Securities Act.

     (k) The Depositary hereunder:

          (i) shall have no duties or obligations other than those specifically
set forth herein (and no implied duties or obligations), or as may subsequently
be agreed to in writing by the parties;

          (ii) shall have no obligation to make payment hereunder unless the
Company shall have provided the necessary federal or other immediately available
funds or securities or property, as the case may be, to pay in full amounts due
and payable with respect thereto;

          (iii) shall not be obligated to take any legal or other action
hereunder; if, however, the Depositary determines to take any legal or other
action hereunder, and, where the taking of such action might in the Depositary's
judgment subject or expose it to any expense or liability, the Depositary shall
not be required to act unless it shall have been furnished with an indemnity
satisfactory to it;

                                       17

<PAGE>

          (iv) may rely on and shall be authorized and protected in acting or
     failing to act upon any certificate, instrument, opinion, notice, letter,
     telegram, telex, facsimile transmission or other document or security
     delivered to the Depositary and believed by the Depositary to be genuine
     and to have been signed by the proper party or parties, and shall have no
     responsibility for determining the accuracy thereof;

          (v) may rely on and shall be authorized and protected in acting or
     failing to act upon the written, telephonic, electronic and oral
     instructions, with respect to any matter relating to the Depositary's
     actions as depositary covered by this Deposit Agreement (or supplementing
     or qualifying any such actions) of officers of the Company;

          (vi) may consult counsel satisfactory to it, and the advice of such
     counsel shall be full and complete authorization and protection in respect
     of any action taken, suffered or omitted by the Depositary hereunder in
     accordance with the advice of such counsel;

          (vii) shall not be called upon at any time to advise any person with
     respect to the Preferred Shares or Receipts;

          (viii) shall not be liable or responsible for any recital or statement
     contained in any documents relating hereto or the Preferred Shares or
     Receipts; and

          (ix) shall not be liable in any respect on account of the identity,
     authority or rights of the parties (other than with respect to the
     Depositary) executing or delivering or purporting to execute or deliver
     this Deposit Agreement or any documents or papers deposited or called for
     under this Deposit Agreement.

     Section 5.04 Resignation and Removal of the Depositary; Appointment of
Successor Depositary. (a) The Depositary may at any time resign as Depositary
hereunder by having notice of its election to do so delivered to the Company,
such resignation to take effect upon the appointment of a successor Depositary
and its acceptance of such appointment as hereinafter provided. The Depositary
may at any time be removed by the Company by notice of such removal delivered to
the Depositary, such removal to take effect upon the appointment of a successor
Depositary and its acceptance of such appointment as hereinafter provided.

     (b) In case at any time the Depositary acting hereunder shall resign or be
removed, the Company shall, within 60 days after the delivery of the notice of
resignation or removal, as the case may be, appoint a successor Depositary,
which shall be a bank or trust company having its principal office in the United
States of America and having a combined capital and surplus of at least
$50,000,000 or shall be an Affiliate of such bank or trust company. If a
successor Depositary shall not have been so appointed within 60 days after
delivery of such notice, the resigning or removed Depositary, at the expense of
the Company, may petition any court of competent jurisdiction to appoint a
successor Depositary. Every successor Depositary shall execute and deliver to
its predecessor and to the Company an instrument in writing accepting its
appointment hereunder, and thereupon such successor Depositary, without any
further act or deed, shall become fully vested with all the rights, powers,
duties and obligations of its predecessor and for all purposes shall be the
Depositary under this Deposit Agreement, and such predecessor, upon payment of
all sums due it and on the written request of the Company, shall

                                       18

<PAGE>

execute and deliver an instrument transferring to such successor all rights and
powers of such predecessor hereunder, shall duly assign, transfer and deliver
all right, title and interest in the deposited Preferred Shares and any moneys
or property held hereunder to such successor, and shall deliver to such
successor a list of the record holders of all outstanding Receipts. Any
successor Depositary shall promptly mail notice of its appointment to the record
holders of Receipts.

     (c) Any corporation or association into or with which the Depositary may be
merged, consolidated or converted shall be the successor of such Depositary
without the execution or filing of any document or any further act, and notice
thereof shall not be required hereunder. Such successor Depositary may execute
the Receipts either in the name of the predecessor Depositary or in the name of
the successor Depositary.

     Section 5.05 Corporate Notices and Reports. The Company agrees that it will
deliver to the Depositary, and the Depositary will, promptly after receipt
thereof, transmit to the record holders of Receipts, in each case at the
addresses furnished to it pursuant to Section 4.08, copies of all notices and
reports (including financial statements) required by law, by the rules of any
national securities exchange upon which the Preferred Shares, the Depositary
Shares or the Receipts are included for quotation or listed or by the Company's
Articles of Association (including the Special Resolutions adopted in accordance
thereto) to be furnished by the Company to holders of deposited Preferred Shares
and, if requested by the holder of any Receipt, a copy of this Deposit
Agreement, the Articles of Association, the Memorandum of Association and the
form of Preferred Shares. Such transmission will be at the Company's expense and
the Company will provide the Depositary with such number of copies of such
documents as the Depositary may reasonably request. In addition, the Depositary
will transmit to the record holders of Receipts at the Company's expense such
other documents as may be requested by the Company.

     Section 5.06 Indemnification by the Company. The Company agrees to
indemnify the Depositary, any Depositary's Agents, any Transfer Agent and any
Registrar against, and hold each of them harmless from and against, any fee,
loss, claim, penalty, fine, settlement, damages, judgment, liability, costs and
expenses (including reasonable attorneys' fees and expenses) that may arise out
of, or in connection with, its acting as Depositary, Depositary's Agent,
Transfer Agent or Registrar, respectively, under this Deposit Agreement and the
Receipts, except to the extent such liability shall have been finally determined
by a court of competent jurisdiction to be a result of the willful misconduct,
gross negligence or bad faith on the part of any such person or persons. The
obligations of the Company set forth in this Section 5.06 shall survive any
resignation or removal of any Depositary, Registrar, Transfer Agent or
Depositary's Agent or termination of this Deposit Agreement.

     Section 5.07 Fees and Expenses. No fees and expenses of the Depositary or
any Depositary's Agent hereunder shall be payable by any person, except as
provided in this Section 5.07. The Company shall pay all transfer and other
taxes and governmental charges arising solely from the existence of this Deposit
Agreement. The Company shall also pay all fees and expenses of the Depositary,
Registrar, Transfer Agent and Depositary's Agent in connection with the initial
deposit of the Preferred Shares and the issuance of the Depositary Shares
evidenced by the Receipts, any redemption of the Preferred Shares at the option
of the Company and all

                                       19

<PAGE>

withdrawals of the Preferred Shares by holders of Depositary Shares. All other
transfer and other taxes and governmental charges shall be at the expense of
holders of Depositary Shares. If a holder of Receipts requests the Depositary to
perform duties not required under this Deposit Agreement, the Depositary shall
notify the holder of the cost of the performance of such duties prior to the
performance thereof. Such holder will be liable for the fees and expenses
related to such performance. All other fees and expenses of the Depositary and
any Depositary's Agent hereunder and of the Registrar and Transfer Agent
(including, in each case, fees and expenses of counsel) incident to the
performance of their respective obligations hereunder will be promptly paid as
previously agreed between the Depositary and the Company. The Depositary shall
present its statement for fees and expenses to the Company every quarter or at
such other intervals as the Company and the Depositary may agree.

                                   ARTICLE VI

                            AMENDMENT AND TERMINATION

     Section 6.01 Amendment. The form of the Receipts and any provision of this
Deposit Agreement may at any time and from time to time be amended by written
agreement between the Company and the Depositary in any respect that they may
deem necessary or desirable; provided, however, that no such amendment (other
than any change in the fees of any Depositary, Registrar or Transfer Agent)
which would materially and adversely alter the rights of the holders of Receipts
shall be effective unless such amendment shall have been approved by the holders
of at least a majority of the Depositary Shares then outstanding, or, in the
case of amendments affecting rights to receive dividends or distributions or
voting or redemption rights, 66 2/3% of the Depositary Shares then outstanding.
In no event shall any amendment impair the right, subject to the provisions of
Section 2.06 and Section 2.07 and Article III, of any holder of any Depositary
Shares to surrender the Receipt evidencing such Depositary Shares with
instructions to the Depositary to deliver to the holder the deposited Preferred
Shares and all money and other property, if any, represented thereby, except in
order to comply with mandatory provisions of applicable law. Every holder of an
outstanding Receipt at the time any such amendment becomes effective shall be
deemed, by continuing to hold such Receipt, to consent and agree to such
amendment and to be bound by the Deposit Agreement as amended thereby.

     Section 6.02 Termination. (a) This Deposit Agreement may be terminated by
the Company or the Depositary only if (i) all outstanding Depositary Shares
shall have been redeemed pursuant to Section 2.03, (ii) there shall have been
made a final distribution in respect of the deposited Preferred Shares in
connection with any liquidation, dissolution or winding up of the Company and
such distribution shall have been distributed to the holders of Receipts
entitled thereto or (iii) with the consent of owners representing not less than
66 2/3% of the Depositary Shares then outstanding. The party terminating this
Deposit Agreement in accordance with the preceding sentence shall provide
written notice of such termination to the Company or the Depositary, as the case
may be.

     (b) Upon the termination of this Deposit Agreement, the Company shall be
discharged from all obligations under this Deposit Agreement except for its
obligations to the Depositary, any Depositary's Agent, the Transfer Agent and
the Registrar under Sections 5.06 and 5.07.

                                       20

<PAGE>

                                  ARTICLE VII

                                  Miscellaneous

     Section 7.01 Counterparts. This Deposit Agreement may be executed in any
number of counterparts, and by each of the parties hereto on separate
counterparts, each of which counterparts, when so executed and delivered, shall
be deemed an original, but all such counterparts taken together shall constitute
one and the same instrument.

     Section 7.02 Exclusive Benefit of Parties. This Deposit Agreement is for
the exclusive benefit of the parties hereto, and their respective successors
hereunder, and shall not be deemed to give any legal or equitable right, remedy
or claim to any other person whatsoever.

     Section 7.03 Invalidity of Provisions. In case any one or more of the
provisions contained in this Deposit Agreement or in the Receipts should be or
become invalid, illegal or unenforceable in any respect, the validity, legality
and enforceability of the remaining provisions contained herein or therein shall
in no way be affected, prejudiced or disturbed thereby.

     Section 7.04 Notices. (a) Any and all notices to be given to the Company
hereunder or under the Receipts shall be in writing and shall be deemed to have
been duly given if personally delivered or sent by mail or telegram or facsimile
transmission (confirmed by letter), addressed to the Company at 17 Woodbourne
Avenue, Hamilton HM 08, Bermuda, facsimile No. 441.296.0087, to the attention of
the Secretary, or at any other address of which the Company shall have notified
the Depositary in writing.

     (b) Any and all notices to be given to the Depositary hereunder or under
the Receipts shall be in writing and shall be deemed to have been duly given if
personally delivered or sent by mail or by telegram or facsimile transmission
(confirmed by letter), addressed to the Depositary at:

                          Mellon Investor Services LLC
                          85 Challenger Road
                          Ridgefield Park, New Jersey 07660
                          Attention:  Relationship Administrator
                          Facsimile:  (201) 329-8967

                          With a copy to:

                          Mellon Investor Services LLC
                          85 Challenger Road
                          Ridgefield Park, New Jersey 07660
                          Attention:  General Counsel
                          Facsimile:  (201) 296-4004

                          or at any other address of which the Depositary shall
                          have notified the Company in writing.

                                       21

<PAGE>

     (c) Any and all notices to be given to any record holder of a Receipt
hereunder or under the Receipts shall be in writing and shall be deemed to have
been duly given if personally delivered or sent by mail or by telegram or
facsimile transmission (confirmed by letter), addressed to such record holder at
the address of such record holder as it appears on the books of the Depositary
or, if such holder shall have filed with the Depositary in a timely manner a
written request that notices intended for such holder be mailed to some other
address, at the address designated in such request.

     (d) Delivery of a notice to the Company or the Depositary sent by mail or
by telegram or facsimile transmission shall be deemed to be effected at the time
when written confirmation is received by the person or entity delivering such
notice. The Depositary or the Company may, however, act upon any notice sent by
mail, telegram or facsimile transmission received by it from the other or from
any holder of a Receipt, notwithstanding that such notice shall not subsequently
be confirmed as aforesaid.

     Section 7.05 Depositary's Agents. The Depositary may from time to time
appoint Depositary's Agents to act in any respect for the Depositary for the
purposes of this Deposit Agreement and may at any time appoint additional
Depositary's Agents and vary or terminate the appointment of such Depositary's
Agents. The Depositary will notify the Company of any such action.

     Section 7.06 Holders of Receipts Are Parties. The holders of Receipts from
time to time shall be parties to this Deposit Agreement and shall be bound by
all of the terms and conditions hereof and of the Receipts by acceptance of
delivery thereof.

     Section 7.07 Governing Law. This Deposit Agreement and the Receipts and all
rights hereunder and thereunder and provisions hereof and thereof shall be
governed by, and constructed in accordance with, the laws of the State of New
York, without regard to choice of law principles. The Company hereby submits to
the non-exclusive jurisdiction of the Federal and state courts in the Borough of
Manhattan in The City of New York in any suit or proceeding arising out of or
relating to this Deposit Agreement or the transactions contemplated thereby. The
Company irrevocably appoints ACE USA, Inc., 1133 Avenue of the Americas, 32nd
Floor, New York, New York 10036 as its authorized agent in the Borough of
Manhattan in The City of New York upon which process may be served in any such
suit or proceeding, and agrees that service of process upon such agent, and
written notice of said service to the Company by the person serving the same to
the address provided in Section 7.04(a), shall be deemed in every respect
effective service of process upon the Company in any such suit or proceeding.
The Company further agrees to take any and all action as may be necessary to
maintain such designation and appointment of such agent in full force and effect
for a period of seven years from the date of this Deposit Agreement.

     Section 7.08 Inspection of Deposit Agreement. Copies of this Deposit
Agreement shall be filed with the Depositary and the Depositary's Agents and
shall be open to inspection during normal business hours at the Depositary's
Office and the respective offices of the Depositary's Agents, if any, by any
holder of a Receipt.

                                       22

<PAGE>

     Section 7.09 Headings. The headings of articles and sections in this
Deposit Agreement and in the form of the Receipt set forth in Exhibit A hereunto
have been inserted for convenience only and are not to be regarded as a part of
this Deposit Agreement or the Receipts or to have any bearing upon the meaning
or interpretation of any provision contained herein or in the Receipts.

                                       23

<PAGE>

     IN WITNESS WHEREOF, the Company and the Depositary have duly executed this
Deposit Agreement as of the day and year first above set forth and all holders
of Receipts shall become parties hereto by and upon acceptance by them of
delivery of Receipts issued in accordance with the terms hereof.

                            ACE LIMITED

                            By:
                               -------------------------------------------------
                               Name:
                               Title:

                            MELLON INVESTOR SERVICES LLC, as Depositary

                            By:
                               -------------------------------------------------
                               Name:
                               Title:

                                      S-1

<PAGE>

[DTC Receipts Legend] [Unless this certificate is presented by an authorized
representative of The Depository Trust Company, a New York corporation ("DTC"),
to the Company or its agent for registration of transfer, exchange or payment,
and any certificate issued is registered in the name of Cede & Co. or in such
other name as is requested by an authorized representative of DTC (and any
payment is made to Cede & Co. or to such other entity as is requested by an
authorized representative of DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR
VALUE OR OTHERWISE BY OR TO ANY PERSON IS WRONGFUL in as much as the registered
owner hereof, Cede & Co., has an interest herein.]

                                                                       Exhibit A
                                                        NUMBER DEPOSITARY SHARES

                    DEPOSITARY RECEIPT FOR DEPOSITARY SHARES,
                           REPRESENTING _____________
                  7.80% CUMULATIVE REDEEMABLE PREFERRED SHARES,
                            SERIES C, PAR VALUE $1.00

                                   ACE LIMITED

                                                                SEE REVERSE SIDE
                                                                  FOR ADDITIONAL
                                                                     INFORMATION

                INCORPORATED UNDER THE LAWS OF THE CAYMAN ISLANDS
                   THIS DEPOSITARY RECEIPT IS TRANSFERABLE IN
                              THE CITY OF NEW YORK

                                                                           CUSIP

     This certifies that __________ is the registered owner of __________
DEPOSITARY SHARES ("Depositary Shares"), each Depositary Share representing
one-tenth (1/10) of one share of 7.80% Cumulative Redeemable Preferred Shares,
Series C, par value $1.00, of ACE Limited, a Cayman Islands Company (the
"Company"), and the same proportionate interest in any and all other property
received by MELLON INVESTOR SERVICES LLC, as Depositary (the "Depositary") in
respect of such shares of Preferred Shares and held by the Depositary under the
Deposit Agreement dated as of May 30, 2003 (the "Deposit Agreement"), among the
Company, the Depositary and all holders from time to time of Receipts. Subject
to the terms of the Deposit Agreement, each owner of a Depositary Share is
entitled, proportionately, to all the rights, preferences and privileges of the
Preferred Shares represented thereby, including the dividend, voting,
liquidation and other rights contained in the Special Resolutions adopted by the
special committee of the Board of Directors of the Company, copies of which are
on file at the Depositary's Office.

                                      A-1

<PAGE>

     By accepting this Depositary Receipt the holder hereof becomes a party to
and agrees to be bound by all the terms and conditions of the Deposit Agreement.
This Depositary Receipt shall not be valid or obligatory for any purpose or
entitled to any benefits under the Deposit Agreement unless it shall have been
executed by the Depositary by the manual or facsimile signature of a duly
authorized signatory of the Depositary or, if applicable, countersigned by a
Registrar in respect of the Depositary Receipts by the manual or facsimile
signature of a duly authorized signatory thereof.

     This Receipt is continued on the reverse hereof and the additional
provisions therein set forth for all purposes have the same effect as if set
forth at this place.

Dated

Countersigned and Registered:

MELLON INVESTOR SERVICES LLC, as       MELLON INVESTOR SERVICES LLC, as
Registrar                              Depositary

By: ____________________________       By: __________________________________
     Authorized Signatory                   Authorized Signatory

                                      A-2

<PAGE>

                            (Form of Reverse Receipt)

                                   ACE LIMITED

     Depositary Receipts, of which this Receipt is one, are made available upon
the terms and conditions set forth in the Deposit Agreement. The Deposit
Agreement sets forth the rights of holders of Receipts and the rights and duties
of the Depositary. The statements made on the face and the reverse of this
Receipt are summaries of certain provisions of the Deposit Agreement and are
subject to the detailed provisions thereof, to which reference is hereby made.

     ACE LIMITED (THE "COMPANY") WILL FURNISH WITHOUT CHARGE TO EACH RECEIPT
HOLDER WHO SO REQUESTS A COPY OF THE DEPOSIT AGREEMENT AND A STATEMENT OR
SUMMARY OF THE POWERS, DESIGNATIONS, PREFERENCES AND RELATIVE, PARTICIPATING,
OPTIONAL OR OTHER SPECIAL RIGHTS OF EACH CLASS OF SHARES OR SERIES THEREOF WHICH
THE COMPANY IS AUTHORIZED TO ISSUE AND OF THE QUALIFICATIONS, LIMITATIONS OR
RESTRICTIONS OF SUCH PREFERENCES AND/OR RIGHTS. ANY SUCH REQUESTS IS TO BE
ADDRESSED TO THE OFFICE OF THE SECRETARY OF THE COMPANY.

                               -----------------

     The following abbreviations, when used in the inscription on the face of
this Receipt, shall be construed as though they were written out in full
according to applicable laws or regulations.

TEN COM -  as tenants in common   UNIF GIFT MIN ACT - ________ Custodian _______
TEN ENT -  as tenants by the                           (Cust)            (Minor)
           entireties                          under Uniform Gifts to Minors Act
JT TEN  -  as joint tenants with
           right of survivorship                ________________________________
           and not as tenants in common                     (State)

     Additional abbreviations may also be used though not in the above list

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

PLEASE INSERT SOCIAL SECURITY OR OTHER
IDENTIFYING NUMBER OF ASSIGNEE

________________________________________________________________________________
PLEASE PRINT OR TYPEWRITE NAME AND ADDRESS INCLUDING POSTAL ZIP CODE OF ASSIGNEE

______________________________________________________________ Depositary Shares
represented by the within Receipt, and do hereby irrevocably constitute and
appoint

________________________________________________________________________________
Attorney to transfer the said Depositary Shares on the books of the within-named
Depositary with full power of substitution in the premises.

Dated:  ___________________

                                      A-2

<PAGE>

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

Signature Guarantee*

_____________________________________

     *Signatures must be guaranteed by an "eligible guarantor institution" as
defined in Rule 17Ad-15 promulgated under the Securities Exchange Act of 1934,
as amended. Guarantees by a notary public are not acceptable.

                                      A-3Form of Warrant for the Purchase of Shares of Common Stock 5/29/2003

 
Exhibit 4.1

 
THE WARRANTS REPRESENTED BY THIS CERTIFICATE AND THE
SHARES ISSUABLE UPON THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE TRANSFERRED EXCEPT UPON DELIVERY TO THE CORPORATION OF AN OPINION OF COUNSEL SATISFACTORY IN FORM
AND SUBSTANCE TO IT THAT SUCH TRANSFER WILL NOT VIOLATE THE SECURITIES ACT OF 1933, AS AMENDED 
 
THE TRANSFER OF THIS WARRANT IS RESTRICTED AS DESCRIBED HEREIN. 
 
CytRx Corporation 
 
Warrant for the Purchase of Shares of Common Stock, 
par value $0.001 per
Share 
 

	 No. W-00    
	 	                 Shares

	 Issuance Date: May 29, 2003
	 	 

 
THIS
CERTIFIES that, for value received,
                                        
                                        
         , whose address is
                                        
                                 ,
                                        
     , or its registered assigns (the “Holder”), is entitled to subscribe for and purchase from CytRx Corporation, a Delaware corporation (the “Company”), upon the terms and conditions set
forth herein,         shares of the Company’s Common Stock, par value $0.001 per share (“Common Stock”), at a price of $3.05 per share, subject to adjustment as provided herein
(the “Exercise Price”). As used herein the term “this Warrant” shall mean and include this Warrant and any Common Stock or Warrants hereafter issued as a consequence of the exercise or transfer of this Warrant in
whole or in part. 
 
The number of shares of Common
Stock issuable upon exercise of the Warrants (the “Warrant Shares”) and the Exercise Price may be adjusted from time to time as hereinafter set forth. The Warrant Shares are entitled to the benefits, and subject to the obligations,
set forth in the Registration Rights Agreement among the Company, the Holder and certain other parties dated concurrently herewith. 
 
1. Exercise Price and Exercise Period. This Warrant may be exercised at any time or from time to time during the period commencing
on the Issuance Date and ending at 5:00 P.M. Pacific time on May 29, 2008 (the “Exercise Period”). 
 
2. Procedure for Exercise; Effect of Exercise. 
 
(a) Cash Exercise. This Warrant may be exercised, in whole or in part, by the Holder during normal
business hours on any business day during the Exercise Period by (i) the delivery 
 

1 

 
to the Company of a duly
executed Notice of Exercise (in the form attached to this Agreement) specifying the number of Warrant Shares to be purchased, (ii) delivery of payment to the Company of the Exercise Price for the number of Warrant Shares specified in the Notice of
Exercise by cash, wire transfer of immediately available funds to a bank account specified by the Company, or by certified or bank cashier’s check (the “Aggregate Exercise Price”), and (iii) the surrender to a common carrier
for overnight delivery to the Company, or as soon as practicable following the date the holder of this Warrant delivers the Notice of Exercise to the Company, of this Warrant (or an indemnification undertaking with respect to this Warrant in the
case of its loss, theft or destruction). 
 
(b)
Cashless Exercise. This Warrant may also be exercised by the Holder through a cashless exercise, as described in this Section 2(b). This Warrant may be exercised, in whole or in part, by (i) the delivery to the Company of a duly executed
Notice of Exercise specifying the number of Warrant Shares to be applied to such exercise, and (ii) the surrender to a common carrier for overnight delivery to the Company, or as soon as practicable following the date the holder of this Warrant
delivers the Notice of Exercise to the Company, of this Warrant (or an indemnification undertaking with respect to this Warrant in the case of its loss, theft or destruction). The number of shares of Common Stock to be issues upon exercise of this
Warrant pursuant to this Section 2(b) shall equal the value of this Warrant (or the portion thereof being canceled) computed as of the date of delivery of this Warrant to the Company using the following formula: 
 

	 X=
	    	 Y(A-B)

	    	     A

 
Where:

 

	 	 	 X = the number of shares of Common Stock to be issued to Holder under this Section 2(b);

	 	 	 Y = the number of Warrant Shares identified in the Notice of Exercise as being applied
to the subject exercise;

	 	 	 A = the Current Market Price on such date; and

	 	 	 B = the Exercise Price on such date

 
For purposes of this
Section 2(b), Current Market Price shall have the definition provided in Section 6(g). 
 
The Company acknowledges and agrees that this Warrant was issued on the date set forth at the end of this Warrant. Consequently, the Company acknowledges and agrees that, if the Holder conducts a
cashless exercise pursuant to this Section 2(b), the period during which the Holder held this Warrant may, for purposes of Rule 144 promulgated under the Securities Act of 1933, as amended (the “Securities Act”), be
“tacked” to the period during which the Holder holds the Warrant Shares received upon such cashless exercise. 
 
Notwithstanding the foregoing, the Holder may conduct a cashless exercise pursuant to 
 

2 

 
this Section 2(b) only after
the first anniversary of the Issuance Date, and then only in the event that a registration statement covering the resale of the Warrant Shares is not then effective at the time that the Holder wishes to conduct such cashless exercise. 
 
(c) Effect of Exercise. Upon receipt by the Company of
a Notice of Exercise, together with proper payment of the Exercise Price, as provided in this Section 2, the Company agrees that such Warrant Shares shall be deemed to be issued to the Holder as the record holder of such Warrant Shares as of the
close of business on the date on which the Notice of Exercise has been delivered and payment has been made for such Warrant Shares in accordance with this Agreement and the Holder shall be deemed to be the holder of record of the Warrant Shares,
notwithstanding that the stock transfer books of the Company shall then be closed or that certificates representing such Warrant Shares shall not then be actually delivered to the Holder. On or before the fifth business day following the date on
which the Company has received each of the Notice of Exercise, the Aggregate Exercise Price (or notice of a cashless exercise) and this Warrant (or an indemnification undertaking with respect to this Warrant in the case of its loss, theft or
destruction) (the “Exercise Delivery Documents”), the Company shall (X) issue and deliver to the address as specified in the Notice of Exercise, a certificate, registered in the name of the holder of this Warrant or its designee,
for the number of shares of Common Stock to which the holder of this Warrant is entitled pursuant to such exercise, or (Y) provided that the Company’s transfer agent (the “Transfer Agent”) is participating in The Depository
Trust Company (“DTC”) Fast Automated Securities Transfer Program, upon the request of the Holder, credit such aggregate number of shares of Common Stock to which the Holder of this Warrant is entitled pursuant to such exercise to
the Holder’s or its designee’s balance account with DTC through its Deposit Withdrawal Agent Commission system. If this Warrant should be exercised in part only, the Company shall, upon surrender of this Warrant for cancellation, execute
and deliver a new Warrant evidencing the right of the Holder to purchase the balance of the Warrant Shares subject to purchase hereunder within five (5) business days of receipt of the Warrant. 
 
3. Registration of Warrants; Transfer of
Warrants. Any Warrants issued upon the transfer or exercise in part of this Warrant shall be numbered and shall be registered in a Warrant Register as they are issued. The Company shall be entitled to treat the registered holder of any Warrant
on the Warrant Register as the owner in fact thereof for all purposes and shall not be bound to recognize any equitable or other claim to or interest in such Warrant on the part of any other person, and shall not be liable for any registration or
transfer of Warrants which are registered or to be registered in the name of a fiduciary or the nominee of a fiduciary unless made with the actual knowledge that a fiduciary or nominee is committing a breach of trust in requesting such registration
or transfer, or with the knowledge of such facts that its participation therein amounts to bad faith. This Warrant shall be transferable only on the books of the Company upon delivery thereof duly endorsed by the Holder or by its duly authorized
attorney or representative, or accompanied by proper evidence of succession, assignment, or authority to transfer. In all cases of transfer by an attorney, executor, administrator, guardian, or other legal representative, duly authenticated evidence
of his or its authority shall be produced. Upon any registration of transfer, the Company shall deliver a new Warrant or Warrants to the person 
 

3 

 
entitled thereto. This Warrant
may be exchanged, at the option of the Holder thereof, for another Warrant, or other Warrants of different denominations, of like tenor and representing in the aggregate the right to purchase a like number of Warrant Shares, upon surrender to the
Company or its duly authorized agent. 
 
4.
Restrictions on Transfer. (a) The Holder, as of the date of issuance hereof, represents to the Company that such Holder is acquiring the Warrants for its own account for investment purposes and not with a view to the distribution thereof or
of the Warrant Shares. Notwithstanding any provisions contained in this Warrant to the contrary, this Warrant and the related Warrant Shares shall not be transferable except pursuant to the proviso contained in the following sentence or upon the
conditions specified in this Section 4, which conditions are intended, among other things, to insure compliance with the provisions of the Securities Act and applicable state law in respect of the transfer of this Warrant or such Warrant Shares. The
Holder by acceptance of this Warrant agrees that the Holder will not transfer this Warrant or the related Warrant Shares prior to delivery to the Company of an opinion of the Holder’s counsel (as such opinion and such counsel are described in
Section 4(b) hereof) or until registration of such Warrant Shares under the Securities Act has become effective or after a sale of such Warrant or Warrant Shares has been consummated pursuant to Rule 144 or Rule 144A under the Securities Act;
provided, however, that the Holder may freely transfer this Warrant or such Warrant Shares (without delivery to the Company of an opinion of Counsel) (i) to one of its nominees, affiliates or a nominee thereof, (ii) to a pension or
profit-sharing fund established and maintained for its employees or for the employees of any affiliate, (iii) from a nominee to any of the aforementioned persons as beneficial owner of this Warrant or such Warrant Shares, or (iv) to a qualified
institutional buyer, so long as such transfer is effected in compliance with Rule 144A under the Securities Act. 
 
(b) The Holder, by its acceptance hereof, agrees that prior to any transfer of this Warrant or of the related Warrant Shares (other than
as permitted by Section 4(a) hereof or pursuant to a registration under the Securities Act), the Holder will give written notice to the Company of its intention to effect such transfer, together with an opinion of such counsel for the Holder as
shall be reasonably acceptable to the Company, to the effect that the proposed transfer of this Warrant and/or such Warrant Shares may be effected without registration under the Securities Act. Upon delivery of such notice and opinion to the
Company, the Holder shall be entitled to transfer this Warrant and/or such Warrant Shares in accordance with the intended method of disposition specified in the notice to the Company. 
 
(c) Each stock certificate representing Warrant Shares issued upon exercise or exchange of this Warrant shall
bear the following legend unless the opinion of counsel referred to in Section 4(b) states such legend is not required: 
 
“THE SECURITIES EVIDENCED BY THIS CERTIFICATE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE
TRANSFERRED EXCEPT UPON DELIVERY TO THE CORPORATION OF AN OPINION OF COUNSEL SATISFACTORY IN FORM AND 
 

4 

 
SUBSTANCE TO IT THAT SUCH TRANSFER WILL NOT VIOLATE THE SECURITIES ACT OF 1933, AS AMENDED.” 
 
The Holder understands that the Company may place, and may instruct any transfer agent or depository for the Warrant Shares to place, a stop transfer
notation in the securities records in respect of the Warrant Shares. 
 
5. Reservation of Shares. The Company shall at all times during the Exercise Period reserve and keep available out of its authorized and unissued Common Stock, solely for the purpose of providing for the exercise of
the rights to purchase all Warrant Shares granted pursuant to the Warrants, such number of shares of Common Stock as shall, from time to time, be sufficient therefor. The Company covenants that all shares of Common Stock issuable upon exercise of
this Warrant, upon receipt by the Company of the full Exercise Price therefor, and all shares of Common Stock issuable upon conversion of this Warrant, shall be validly issued, fully paid, non-assessable, and free of preemptive rights. 
 
6. Exercise Price Adjustments. The Exercise Price shall
be subject to adjustment from time to time as follows: 
 
(a) (i) In the event that the Company shall (A) pay a dividend or make a distribution, in shares of Common Stock, on any class of capital stock of the Company or any subsidiary which is not directly or indirectly wholly owned by the
Company, (B) split or subdivide its outstanding Common Stock into a greater number of shares, or (C) combine its outstanding Common Stock into a smaller number of shares, then in each such case the Exercise Price in effect immediately prior thereto
shall be adjusted so that the Holder of a Warrant thereafter surrendered for Exercise shall be entitled to receive the number of shares of Common Stock that such Holder would have owned or have been entitled to receive after the occurrence of any of
the events described above had such Warrant been exercised immediately prior to the occurrence of such event. An adjustment made pursuant to this Section 6(a)(i) shall become effective immediately after the close of business on the record date in
the case of a dividend or distribution (except as provided in Section 6(e) below) and shall become effective immediately after the close of business on the effective date in the case of such subdivision, split or combination, as the case may be. Any
shares of Common Stock issuable in payment of a dividend shall be deemed to have been issued immediately prior to the close of business on the record date for such dividend for purposes of calculating the number of outstanding shares of Common Stock
under clauses (ii) and (iii) below. 
 
(ii) In the
event that the Company shall commit to issue or distribute Common Stock or issue rights, warrants, options or convertible or exchangeable securities entitling the holder thereof to subscribe for or purchase, convert into or exchange for Common
Stock, in any such case at a price per share less than the Current Market Price per share on the earliest of (i) the date the Company shall enter into a firm contract for such issuance or distribution, (ii) the record date for the determination of
stockholders entitled to receive any such rights, warrants, options or convertible or exchangeable securities, if applicable, or (iii) the 
 
 

5 

 
date of actual issuance or
distribution of any such Common Stock or rights, warrants, options or convertible or exchangeable securities (provided that the issuance of Common Stock upon the exercise of rights, warrants, options or convertible or exchangeable securities will
not cause an adjustment in the Exercise Price if no such adjustment would have been required at the time such right, warrant, option or convertible or exchangeable security was issued), then the Exercise Price in effect immediately prior to such
earliest date shall be adjusted so that the Exercise Price shall equal the price determined by multiplying the Exercise Price in effect immediately prior to such earliest date by the fraction: 
 
(x) whose numerator shall be the number of shares of Common
Stock outstanding on such date plus the number of shares which the aggregate offering price of the total number of shares so offered would purchase at such Current Market Price (such amount, with respect to any such rights, warrants, options or
convertible or exchangeable securities, determined by multiplying the total number of shares subject thereto by the exercise price of such rights, warrants, options or convertible or exchangeable securities and dividing the product so obtained by
the Current Market Price), and 
 
(y) whose
denominator shall be the number of shares of Common Stock outstanding on such date plus the number of additional shares of Common Stock to be issued or distributed or receivable upon exercise of any such right, warrant, option or convertible or
exchangeable security. 
 
Such adjustment shall be made
successively whenever any such Common Stock, rights, warrants, options or convertible or exchangeable securities are issued or distributed. In determining whether any rights, warrants or options entitle the holders to subscribe for or purchase
shares of Common Stock at less than such Current Market Price, and in determining the aggregate offering price of shares of Common Stock so issued or distributed, there shall be taken into account any consideration received by the Company for such
Common Stock, rights, warrants, options, or convertible or exchangeable securities, the value of such consideration, if other than cash, to be determined by the Board of Directors, whose determination shall be conclusive and described in a
certificate filed with the records of corporate proceedings of the Company. If any right, warrant, option or convertible or exchangeable security to purchase or acquire Common Stock, the issuance of which resulted in an adjustment in the Exercise
Price pursuant to this subsection (ii) shall expire and shall not have been exercised, the Exercise Price shall immediately upon such expiration be recomputed to the Exercise Price which would have been in effect had the adjustment of the Exercise
Price made upon the issuance of such right, warrant, option or convertible or exchangeable security been made on the basis of offering for subscription, purchase or issuance, as the case may be, only of that number of shares of Common Stock actually
purchased or issued upon the actual exercise of such right, warrant, option or convertible or exchangeable securities. 
 
(iii) No adjustment in the Exercise Price shall be required unless the adjustment would require an increase or decrease of at least 1% in
the Exercise Price then in 
 

6 

 
effect; provided,
however, that any adjustments that by reason of this Section 6(a) are not required to be made shall be carried forward and taken into account in any subsequent adjustment. All calculations under this Section 6(a) shall be made to the nearest
cent or nearest 1/100th of a share. 
 
(iv)
Notwithstanding anything to the contrary set forth in this Section 6(a), no adjustment shall be made to the Exercise Price upon (A) the issuance of shares of Common Stock pursuant to any compensation or incentive plan for officers, directors,
employees or consultants of the Company which plan has been approved by the Compensation Committee of the Board of Directors (or, if there is no such committee then serving, by the majority vote of the Directors then serving each of which Director
is not (x) an employee or officer of the Company, (y) a 5% or greater stockholder of the Company, or (y) an officer, employee, affiliate or associate of any such 5% or greater stockholder) (unless the exercise price thereof is changed after the date
hereof other than solely by operation of the anti-dilution provisions thereof or by the Compensation Committee of the Board of Directors or, if applicable, the Board of Directors and, if required by law, the stockholders of the Company), or (B) the
issuance of Common Stock upon the conversion or exercise of the options, warrants or rights of the Company outstanding on May 29, 2003, unless the conversion or exercise price thereof is changed after May 29, 2003 (other than solely by operation of
the anti-dilution provisions thereof). 
 
(v) The
Company from time to time may reduce the Exercise Price by any amount for any period of time in the discretion of the Board of Directors; provided, however, that if the Company so reduces the Exercise Price, then it shall similarly reduce the
exercise price of all other warrants sold and issued to other holders pursuant to that certain Securities Purchase Agreement dated as of May 29, 2003, by and among the Company, the Holder and certain other holders. A voluntary reduction of the
Exercise Price does not change or adjust the Exercise Price otherwise in effect for purposes of this Section 6(a). 
 
(vi) In the event that, at any time as a result of an adjustment made pursuant to Sections 6(a)(i) through 6(a)(iii) above, the Holder of
any Warrant thereafter surrendered for exercise shall become entitled to receive any shares of the Company other than shares of the Common Stock, thereafter the number of such other shares so receivable upon exercise of any such Warrant shall be
subject to adjustment from time to time in a manner and on terms as nearly equivalent as practicable to the provisions with respect to the Common Stock contained in Sections 6(a)(i) through 6(a)(v) above, and the other provisions of this Section
6(a) with respect to the Common Stock shall apply on like terms to any such other shares. 
 
(b) In case of any reclassification of the Common Stock (other than in a transaction to which Section 6(a)(i) applies), any consolidation of the Company with, or merger of the Company into, any other
entity, any merger of another entity into the Company (other than a merger that does not result in any reclassification, conversion, exchange or cancellation of outstanding shares of Common Stock of the Company), any sale or transfer of all or
substantially all of the assets of the Company or any compulsory share exchange, pursuant to which share exchange the Common Stock is converted into other securities, cash or other 
 

7 

 
property, then lawful
provision shall be made as part of the terms of such transaction whereby the Holder of a Warrant then outstanding shall have the right thereafter, during the period such Warrant shall be exercisable, to exercise such Warrant only for the kind and
amount of securities, cash and other property receivable upon the reclassification, consolidation, merger, sale, transfer or share exchange by a holder of the number of shares of Common Stock of the Company into which a Warrant might have been able
to exercise for immediately prior to the reclassification, consolidation, merger, sale, transfer or share exchange assuming that such holder of Common Stock failed to exercise rights of election, if any, as to the kind or amount of securities, cash
or other property receivable upon consummation of such transaction subject to adjustment as provided in Section 6(a) above following the date of consummation of such transaction. The Company shall not effect any such reclassification, consolidation,
merger, sale, transfer, share exchange or other disposition unless prior to or simultaneously with the consummation thereof the successor corporation (if other than the Company) resulting from such consolidation or merger, or the corporation
purchasing or otherwise acquiring such assets or other appropriate corporation or entity shall assume, by written instrument executed and delivered to the Holder, the obligation to deliver to the Holder upon its exercise of the Warrant such shares
of stock, securities or assets as, in accordance with the foregoing provisions, the Holder may be entitled to purchase and the other obligations under this Warrant. Notwithstanding the foregoing, in the case of any sale or transfer of all or
substantially all of the assets of the Company or merger or consideration of the Company in which the shareholders of the Company receive cash or other property for each of their shares of Common Stock in excess of the then Exercise Price, this
Warrant will terminate if not exercised by the Holder no later than the closing of such sale, merger or consolidation. The provisions of this Section 6(b) shall similarly apply to successive reclassifications, consolidations, mergers, sales,
transfers or share exchanges. 
 
(c) If:

 

	 	(i)	 	the Company shall take any action which would require an adjustment in the Exercise Price pursuant to Section 6(a); or 

 

	 	(ii)	 	the Company shall authorize the granting to the holders of its Common Stock generally of rights, warrants or options to subscribe for or purchase any shares of any
class or any other rights, warrants or options; or 

 

	 	(iii)	 	there shall be any reclassification or change of the Common Stock (other than a subdivision or combination of its outstanding Common Stock or a change in par value)
or any consolidation, merger or statutory share exchange to which the Company is a party and for which approval of any stockholders of the Company is required, or the sale or transfer of all or substantially all of the assets of the Company; or

 

8 

 

	 	(iv)	 	there shall be a voluntary or involuntary dissolution, liquidation or winding up of the Company; 

 
then, in each such case, the Company shall cause to be filed with the transfer
agent for the Warrants and shall cause to be mailed to each Holder at such Holder’s address as shown on the books of the transfer agent for the Warrants, as promptly as possible, but at least 30 days prior to the applicable date hereinafter
specified, a notice stating (A) the date on which a record is to be taken for the purpose of such dividend, distribution or granting of rights, warrants or options, or, if a record is not to be taken, the date as of which the holders of Common Stock
of record to be entitled to such dividend, distribution or rights, warrants or options are to be determined, or (B) the date on which such reclassification, change, consolidation, merger, statutory share exchange, sale, transfer, dissolution,
liquidation or winding-up is expected to become effective or occur, and the date as of which it is expected that holders of Common Stock of record shall be entitled to exchange their shares of Common Stock for securities or other property
deliverable upon such reclassification, change, consolidation, merger, statutory share exchange, sale, transfer, dissolution, liquidation or winding up. Failure to give such notice or any defect therein shall not affect the legality or validity of
the proceedings described in this Section 6(c). 
 
(d) Whenever the Exercise Price is adjusted as herein provided, the Company shall promptly file with the transfer agent for the Warrants a certificate of an officer of the Company setting forth the Exercise Price after the adjustment
and setting forth a brief statement of the facts requiring such adjustment and a computation thereof. The Company shall promptly cause a notice of the adjusted Exercise Price to be mailed to each Holder. 
 
(e) In any case in which Section 6(a) provides that an
adjustment shall become effective immediately after a record date for an event and the date fixed for such adjustment pursuant to Section 6(a) occurs after such record date but before the occurrence of such event, the Company may defer until the
actual occurrence of such event (i) issuing to the Holder of any Warrants exercised after such record date and before the occurrence of such event the additional shares of Common Stock issuable upon such conversion by reason of the adjustment
required by such event over and above the Common Stock issuable upon such exercise before giving effect to such adjustment, and (ii) paying to such holder any amount in cash in lieu of any fraction pursuant to Section 6(i). 
 
(f) In case the Company shall take any action affecting the
Common Stock, other than actions described in this Section 6, which in the opinion of the Board of Directors would materially adversely affect the exercise right of the Holders, the Exercise Price may be adjusted, to the extent permitted by law, in
such manner, if any, and at such time, as the Board of Directors may determine to be equitable in the circumstances; provided, however, that in no event shall the Board of Directors be required to take any such action. 
 
(g) For the purpose of any computation under Section 2(b) or
this Section 6, the “Current Market Price” per share of Common Stock on any day shall mean: 
 

9 

 
(i) if the principal trading
market for such securities is a national or regional securities exchange, the closing price on such exchange on such day; or (ii) if sales prices for shares of Common Stock are reported by the NASDAQ National Market System or NASDAQ Small Cap Market
(or a similar system then in use), the last reported sales price (regular way) so reported on such day; or (iii) if neither (i) nor (ii) above are applicable, and if bid and ask prices for shares of Common Stock are reported in the over-the-counter
market by NASDAQ (or, if not so reported, by the National Quotation Bureau), the average of the high bid and low ask prices so reported on such day. Notwithstanding the foregoing, if there is no reported closing price, last reported sales price, or
bid and ask prices, as the case may be, for the day in question, then the Current Market Price shall be determined as of the latest date prior to such day for which such closing price, last reported sales price, or bid and ask prices, as the case
may be, are available, unless such securities have not been traded on an exchange or in the over-the-counter market for 30 or more days immediately prior to the day in question, in which case the Current Market Price shall be determined in good
faith by, and reflected in a formal resolution of, the Board of Directors of the Company. 
 
(h) Upon each adjustment of the Exercise Price, this Warrant shall thereafter evidence the right to purchase, at the adjusted Exercise Price, that number of shares (calculated to the nearest
thousandth) obtained by dividing (i) the product obtained by multiplying the number of shares purchasable upon exercise of this Warrant prior to adjustment of the number of shares by the Exercise Price in effect prior to adjustment of the Exercise
Price, by (ii) the Exercise Price in effect after such adjustment of the Exercise Price. 
 
(i) The Company shall not be required to issue fractions of shares of Common Stock or other capital stock of the Company upon the exercise of this Warrant. If any fraction of a share would be issuable
on the exercise of this Warrant (or specified portions thereof), the Company shall purchase such fraction for an amount in cash equal to the same fraction of the Current Market Price of such share of Common Stock on the date of exercise of this
Warrant. 
 
7. Beneficial Ownership. The
Company shall not effect the exercise of this Warrant, and no Person (as defined below) who is a holder of this Warrant shall have the right to exercise this Warrant, to the extent that after giving effect to such exercise, such Person (together
with such Person’s affiliates) would beneficially own in excess of 9.99% of the shares of the Common Stock outstanding immediately after giving effect to such exercise. For purposes of the foregoing sentence, the aggregate number of shares of
Common Stock beneficially owned by such Person and its affiliates shall include the number of shares of Common Stock issuable upon exercise of this Warrant with respect to which the determination of such sentence is being made, but shall exclude
shares of Common Stock which would be issuable upon (i) exercise of the remaining, unexercised portion of this Warrant beneficially owned by such Person and its affiliates and (ii) exercise or conversion of the unexercised or unconverted portion of
any other securities of the Company beneficially owned by such Person and its affiliates (including, without limitation, any debentures, convertible notes or convertible preferred stock or warrants) subject to a limitation on conversion or exercise
analogous to the 
 

10 

 
limitation contained herein.
Except as set forth in the preceding sentence, for purposes of this paragraph, beneficial ownership shall be calculated in accordance with Section 13(d) of the Securities Exchange Act of 1934, as amended. For purposes of this Warrant, in determining
the number of outstanding shares of Common Stock, a holder may rely on the number of outstanding shares of Common Stock as reflected in (1) the Company’s most recent Form 10-Q, Form 10-K or other public filing with the Securities and Exchange
Commission, as the case may be, (2) a more recent public announcement by the Company or (3) any other notice by the Company or its Transfer Agent setting forth the number of shares of Common Stock outstanding. For any reason at any time, upon the
written or oral request of the holder of this Warrant, the Company shall within two Business Days confirm orally and in writing to the holder of this Warrant the number of shares of Common Stock then outstanding. In any case, the number of
outstanding shares of Common Stock shall be determined after giving effect to the conversion or exercise of securities of the Company by the holder of this Warrant and its affiliates since the date as of which such number of outstanding shares of
Common Stock was reported. In effecting the exercise of this Warrant, the Company shall be entitled to rely on a representation by the holder of this Warrant as to the number of shares that it beneficially owns for purposes of the above 9.99%
limitation calculation. 
 
8. Transfer
Taxes. The issuance of any shares or other securities upon the exercise of this Warrant, and the delivery of certificates or other instruments representing such shares or other securities, shall be made without charge to the Holder for any tax
or other charge in respect of such issuance. The Company shall not, however, be required to pay any tax which may be payable in respect of any transfer involved in the issue and delivery of any certificate in a name other than that of the Holder and
the Company shall not be required to issue or deliver any such certificate unless and until the person or persons requesting the issue thereof shall have paid to the Company the amount of such tax or shall have established to the satisfaction of the
Company that such tax has been paid. 
 
9. Loss
or Mutilation of Warrant. Upon receipt of evidence reasonably satisfactory to the Company of the loss, theft, destruction, or mutilation of any Warrant (and upon surrender of any Warrant if mutilated), and upon reimbursement of the
Company’s reasonable incidental expenses, the Company shall execute and deliver to the Holder thereof a new Warrant of like date, tenor, and denomination. 
 
10. No Rights as a Stockholder. The Holder of any Warrant shall not have, solely on account of such status, any rights of a
stockholder of the Company, either at law or in equity, or to any notice of meetings of stockholders or of any other proceedings of the Company, except as provided in this Warrant. 
 
11. Governing Law. This Warrant shall be construed in accordance with the laws of the State of New
York applicable to contracts made and performed within such State, without regard to principles of conflicts of law. 
 

11 

 
Dated: May 29,
2003 

	 CYTRX CORPORATION

	
	 By:
	 	  

	 	 	 Steven A. Kriegsman,
 Chief Executive Officer

 
 

12 

 
FORM OF
ASSIGNMENT 
 
(To be executed by the registered
holder if such holder desires to transfer the attached Warrant.) 
 
FOR VALUE RECEIVED,
                                        
                                        
hereby sells, assigns, and transfers unto
                                     a Warrant to purchase
                                        
shares of Common Stock, par value $0.001 per share, of CytRx Corporation (the “Company”), together with all right, title, and interest therein, and does hereby irrevocably constitute and appoint
                                        
                                        
attorney to transfer such Warrant on the books of the Company, with full power of substitution. 
 

	
	 Dated
	 	  

	 
	
	 By:
	 	  

	 	 	 Signature

 
The signature on the foregoing Assignment must correspond to the name as written upon the face of this Warrant in every 
particular, without alteration or enlargement or any change whatsoever. 

 

	 To:
	 	 CytRx Corporation
 11726 San Vicente Blvd., Suite 650
 Los Angeles, California 90049

Attention: Chief Executive Officer

 
NOTICE
OF EXERCISE 
 
The undersigned hereby exercises
his or its rights to purchase                                  Warrant Shares
covered by the within Warrant and tenders payment herewith in the amount of
$                                 by [tendering cash or delivering a certified
check or bank cashier’s check, payable to the order of the Company] [surrendering                          shares of
Common Stock received upon exercise of the attached Warrant, which shares have a Current Market Price equal to such payment] in accordance with the terms thereof, and requests that certificates for such securities be issued in the name of, and
delivered to: 
 

	
	

	
	

	
	

 
 
(Print Name, Address and Social Security 
or Tax
Identification Number) 
 
and, if such number of Warrant Shares
shall not be all the Warrant Shares covered by the within Warrant, that a new Warrant for the balance of the Warrant Shares covered by the within Warrant be registered in the name of, and delivered to, the undersigned at the address stated below.

 

	
	 Date:
	 	  

	 	 	 

	
	 By:
	 	  

	 	 	 Print Name

	
	

	       Signature

 
Address:

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