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                           SHARE PURCHASE AGREEMENT


                                  dated as of


                               December 31, 1999


                                    between


                    SCOTTISH ANNUITY & LIFE HOLDINGS, LTD.


                                      and


                            SCOTTISH HOLDINGS, LTD.



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                           SHARE PURCHASE AGREEMENT

     SHARE PURCHASE AGREEMENT (this "Agreement") dated as of December 31, 1999,
between Scottish Annuity & Life Holdings, Ltd., a company organized and existing
under the laws of the Cayman Islands ("Purchaser"), and Scottish Holdings, Ltd.,
a company organized and existing under the laws of the Cayman Islands (the
"Seller").

                                   RECITALS:
                                   --------

     A.   Seller is the registered and beneficial owner of all of the issued and
outstanding ordinary shares, par value $1.00 (the "Shares"), of The Scottish
Annuity Company (Cayman) Ltd. (the "Company").

     B.   Seller and Purchaser have determined to enter into this Agreement
which provides for Seller to sell, transfer and convey to Purchaser, and
Purchaser to purchase and receive from Seller, all of the Shares.

     NOW, THEREFORE, in consideration of the warranties, covenants and
agreements set forth herein, and for other good and valuable consideration the
receipt and sufficiency of which are hereby acknowledged, Purchaser and Seller
hereby agree as follows:

                                   ARTICLE I
                        PURCHASE AND SALE OF THE SHARES

     Section 1.1  Sale and Transfer of the Transferred Shares.  Subject to the
                  -------------------------------------------
provisions of this Agreement, Seller agrees to sell, and Purchaser agrees to
purchase, the Shares as of and with effect from the Closing.

     Section 1.2  Payment.  (a) The total purchase price payable by Purchaser to
                  -------
Seller (the "Purchase Price"), shall be (i) $10,500,000.00 in cash and (ii)
$1,062,161.84 in cash, representing purchase price consideration for current
assets of the Company consisting of cash of $250,000.00, fees receivables in the
amount of $826,503.30, and a deposit on the phone system in the amount of
$3,658.54 less audit fees payable in the amount of $18,000.00.

             (b)  The portion of the purchase price set forth in Section
1.2(a)(ii) above will be subject to a positive or negative adjustment at Closing
to reflect, on a dollar-for-dollar basis, changes in the current liabilities,
cash, and cash equivalents of the Company on the Closing Date.

     Section 1.3  Closing.  Unless this Agreement has been terminated and the
                  -------
transactions contemplated under this Agreement have been abandoned pursuant to
Section 5.1, the closing of the transfer of the Shares (the "Closing") will take
place at the offices of the Purchaser, at 10:00 a.m. on December 31, 1999 (the
"Closing Date").  The Closing will be effective as of 11:59 p.m. on the Closing
Date.  At the Closing, Purchaser shall pay the Cash Payment via wire transfer of
immediately available funds to the account designated by Seller, and Seller
shall deliver to Purchaser at the Closing the Shares free and clear of any
mortgage, lien, pledge, charge, security interest, restriction on voting or
transfer, or other encumbrance ("Lien") with the certificate or certificates (i)
evidencing the Shares duly endorsed or (ii) accompanied by a duly executed share
transfer power.

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                                  ARTICLE II
                           REPRESENTATIONS OF SELLER

     Seller hereby represents to Purchaser as follows:

     Section 2.1  Corporate Organization and Qualification. The Company is a
                  ----------------------------------------
company duly organized and validly existing under the laws of the Cayman
Islands.

     Section 2.2  Corporate Authority. Seller has the requisite corporate power
                  -------------------
and authority to execute and deliver this Agreement and to consummate the
transactions contemplated hereby and the execution and delivery of this
Agreement by Seller and the consummation of the transactions contemplated to be
performed hereunder have been duly authorized by all necessary corporate actions
of Seller. This Agreement is a valid and binding agreement of Seller,
enforceable against it in accordance with the terms hereof except as such
enforceability may be limited by bankruptcy, insolvency, reorganization or other
similar laws affecting the enforcement of creditors' rights generally.

     Section 2.3  Capital of the Company
                  ----------------------

             (a)  The authorized capital of the Company consists of 1,000,000
ordinary shares, $1.00 par value, of which 250,000 shares are issued and
outstanding, and the Shares constitute all of the issued and outstanding shares
of the Company. Seller is the registered and beneficial owner of the Shares free
and clear of any Lien.

             (b)  The Shares have been duly authorized and validly issued and
are fully paid and non-assessable. There are no (i) securities of the Company
convertible into or exchangeable for shares of the Company, (ii) warrants,
options or other rights to acquire from the Company, or other obligations of the
Company, to issue any shares or securities convertible into or exchangeable for
shares of the Company, or (iii) bonds, debentures, notes or other obligations or
securities of the Company, the holders of which have the right to vote with the
shareholders of the Company, on any matter submitted for the vote of the Company
shareholders.

     Section 2.4  Information; Financial Condition; No Material Adverse Change.
                  ------------------------------------------------------------
Purchaser has received from the Company its Memorandum of Association and its
Articles of Association (the "Company Corporate Documents") and its audited
balance sheet dated December 31, 1998, its audited statement of income,
shareholder's equity, and cash flows for the year ended December 31, 1998, its
unaudited balance sheet dated September 30, 1999, and its unaudited statement of
income, shareholder's equity, and cash flows for the period ended September 30,
1999 in the form attached as Exhibit A hereto (the "Company Financial
Statements").  Purchaser has also received an unaudited, pro forma balance sheet
dated December 31, 1999 and unaudited, pro forma statement of income,
shareholder's equity, and cash flows for the period ended December 31, 1999 in
the form attached to Exhibit B.  Seller represents that (a) the Company
Financial Statements have been prepared in accordance with United States
generally accepted accounting principles and present fairly the financial
condition and results of operations of the Company as of such dates and for the
periods indicated, (b) all material liabilities and obligations of the Company
are reflected on or reserved against in such balance sheets or in the notes to
such financial statements, and (c) since September 30, 1999,

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there has not been, and at Closing there will not be, any material adverse
change in the financial condition, results of operations or business of the
Company nor any condition, event or development that may reasonably be expected
to result in any such material adverse change, except as otherwise disclosed in
Exhibit B.
---------

     Section 2.5  Company Authority. The Company possesses all licenses and
                  -----------------
authority required for the conduct of its business as presently conducted and
the purchase of the Shares by Purchaser will not conflict with or terminate, or
create a condition permitting the termination of, such licenses and authority.

     Section 2.6  Further Assurances.  From and after Closing, Seller shall
                  ------------------
execute and deliver any assignments or assurances and shall take and do any
other actions or things reasonably necessary to carry out the intention of this
Agreement.

                                  ARTICLE III
                         REPRESENTATIONS OF PURCHASER

     Purchaser hereby represents to Seller as follows:

     Section 3.1  Corporate Organization and Qualification. Purchaser is a
                  ----------------------------------------
company validly existing and in good standing under the laws of the Cayman
Islands.

     Section 3.2  Corporate Authority. Purchaser has the requisite corporate
                  -------------------
power and authority to execute and deliver this Agreement and to consummate the
transactions contemplated hereby. The execution and delivery of this Agreement
by Purchaser and the consummation by it of the transactions contemplated to be
performed hereunder have been duly authorized by all necessary corporate
actions. This Agreement is a valid and binding obligation of Purchaser,
enforceable against it in accordance with the terms hereof except as such
enforceability may be limited by bankruptcy, insolvency, reorganization or other
similar laws affecting the enforcement of creditors' rights generally.

     Section 3.3  Suitability and Sophistication. Purchaser (a) is an
                  ------------------------------
"accredited investor" as defined in Rule 501(a) promulgated under the Securities
Act, (b) has such knowledge and experience in financial and business affairs
generally and in the fixed annuity business in particular that it is capable of
evaluating the risks and merits of purchasing the Shares, (c) has independently
evaluated the risks and merits of purchasing the Shares and has independently
determined that the Shares are a suitable investment for the Purchaser, which
has a current on- going business arrangement with the Company and is therefore
knowledgeable about the Company's business, (d) has sufficient financial
resources to bear the loss of its entire investment in the Shares, (e) has
received from Seller and the Company, or had made available to it, financial and
other information related to the Company, and the Company and its officers, as
well as the Seller, have made themselves available to answer any questions about
the Company, its business and the Shares and have agreed to provide all
information about the Company, its business and the Shares reasonably available
to the Company or the Seller and (f) understands that the Shares have not been
registered under the Securities Act or any state or foreign securities law, and
may not be transferred unless subsequently registered thereunder or pursuant to
an

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exemption from regulation and that a legend indicating such restriction should
be placed on the certificates representing the Shares.

     Section 3.4  Further Assurances.  From and after the Closing Purchaser
                  ------------------
shall execute and deliver any assignments or assurances and shall take and do
any other actions or things reasonably necessary to carry out the intention of
this Agreement.

                                  ARTICLE IV
                          CONDITIONS TO THE TRANSFER

     Section 4.1  Conditions to the Obligations of Seller.  The obligation of
                  ---------------------------------------
Seller to consummate the transfer of the Shares is subject to the satisfaction
(or waiver by Seller) of the condition that (a) Purchaser shall have performed
and complied with in all material respects all obligations and covenants
required to be performed or complied with by it under this Agreement at or prior
to the Closing Date and (b) the transactions contemplated in Exhibit B shall
have been consummated.

     Section 4.2  Conditions to the Obligations of Purchaser.  The obligation of
                  ------------------------------------------
Purchaser to consummate the transfer of the Shares is subject to the
satisfaction (or waiver by Purchaser) of the condition that Seller shall have
performed and complied with in all material respects all obligations and
covenants required to be performed or complied with by it under this Agreement
at or prior to the Closing Date.

                                   ARTICLE V
                                  TERMINATION

     Section 5.1  Termination.  This Agreement may be terminated and the
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transactions contemplated hereby may be abandoned at any time prior to the
Closing by mutual written consent of Seller and Purchaser.

     Section 5.2  Effect of Termination.  In the event of the termination of
                  ---------------------
this Agreement pursuant to Section 5.1 hereof, this Agreement shall forthwith
become null and void and have no effect, without any liability on the part of
any party or their respective directors, officers or shareholders. Nothing in
this Article V shall, however, relieve any party to this Agreement of liability
for breach of this Agreement occurring prior to such termination, or for breach
of any provision of this Agreement which specifically survives termination
hereunder.

                                  ARTICLE VI
                                TRANSFER TAXES

     Section 6.1  Transfer Taxes.  Purchaser shall be responsible for the
                  --------------
payment of all national, state, local, municipal and other transfer, stamp,
sales, use or other similar taxes (and all recording or filing fees) resulting
from the transactions contemplated by this Agreement.

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                                  ARTICLE VII
                                 MISCELLANEOUS

     Section 7.1  Entire Agreement.  This Agreement constitutes the entire
                  ----------------
agreement of the parties hereto with respect to the subject matter hereof and
supersedes all prior agreements and undertakings, both written and oral, with
respect to the subject matter hereof. It is agreed that neither party has
entered into this Agreement in reliance upon any representation, warranty or
undertaking of the other party which is not expressly set forth in this
Agreement.

     Section 7.2  Notices.  All notices, requests and other communications to
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any party hereunder shall be in writing (including facsimile) and signed by or
on behalf of the party giving it and shall be given by personal delivery,
certified or registered mail or telecopy

     if to Seller, to:        Scottish Holdings, Ltd.
                              P.O. Box 10658 APO
                              5th Floor
                              Ugland House
                              Grand Cayman
                              Attn:  Manager, Finance and Administration
     Facsimile:               (345) 949-2519
     Telephone:               (345) 949-2519


     If to Purchaser to:      Scottish Annuity & Life Holdings, Ltd.
                              P.O. Box 10657 APO
                              Grand Pavilion Commercial Centre
                              802 West Bay Road
                              Grand Cayman
                              Cayman Islands, BWI
                              Attn:  President and Chief Executive Officer
     Facsimile:               (345) 945-0300
     Telephone:               (345) 949-2800

or such other address or facsimile number as such party may hereafter specify
for the purpose by notice to the other parties hereto.  Each such notice,
request or other communication shall be effective (i) if given by facsimile
transmission, three hours after the time of dispatch to the facsimile number
specified in this Section 7.2 provided the appropriate confirmation is received,
or (ii) if given by any other means allowed under this Section 7.2, twenty-four
hours after being sent to the address specified in this Section 7.2.

     Section 7.3  Amendments; No Waivers.
                  -----------------------

             (a)  Any provision of this Agreement may be amended or waived prior
to the Closing Date if, and only if, such amendment or waiver is in writing and
signed, in the case of an

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amendment, by Seller and Purchaser or in the case of a waiver, by the party
against whom the waiver is to be effective.

             (b)  No failure or delay by any party in exercising any right,
power or privilege hereunder shall operate as a waiver thereof nor shall any
single or partial exercise thereof preclude any other or further exercise
thereof or the exercise of any right, power or privilege.

     Section 7.4  Expenses.  Except as otherwise provided herein, all costs and
                  --------
expenses incurred in connection with this Agreement shall be paid by the party
incurring such cost or expense.

     Section 7.5  Successors and Assigns.  The provision of this Agreement
                  ----------------------
shall be binding upon and insure to the benefit of the parties hereto and their
respective successors and assigns, provided that, no party may assign, delegate
or otherwise transfer any of its rights or obligations under this Agreement
without the consent of the other parties hereto.  Notwithstanding anything
contained in this Agreement to the contrary, nothing in this Agreement,
expressed or implied, is intended to confer on any person, other than the
parties hereto or their respective successors and permitted assigns, any rights,
remedies, obligations or liabilities under or by reason of this Agreement.

     Section 7.6  Certain Interpretive Matters.
                  ----------------------------

             (a)  Unless the context otherwise requires, (i) all references in
this Agreement to Sections or Articles are to Sections or Articles of this
Agreement, (ii) each term defined in this Agreement has the meaning ascribed to
it, and (iii) words in the singular include the plural and vice versa. All
                                                           ---- -----
references to "$" or dollar amounts will be to lawful currency of the United
States of America.

             (b)  Titles and headings to Sections herein are inserted for
convenience of reference only, and are not intended to be a part of or to affect
the meaning or interpretation of this Agreement.

     Section 7.7  Counterparts; Effectiveness.  This Agreement may be signed in
                  ---------------------------
any number of counterparts, each of which shall be an original, with the same
effect as if the signatures thereto and hereto were upon the same instrument.

     Section 7.8. Severability.  If any term, provision, covenant or restriction
                  ------------
of this Agreement is determined to be invalid, void or unenforceable, the
remainder of the terms, provisions, covenants and restrictions of this Agreement
will remain in full force and effect and will in no way be affected, impaired or
invalidated.

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     IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
duly executed by their respective authorized officers as of the day and year
first above written.

                        BY PURCHASER:

                        SCOTTISH ANNUITY & LIFE HOLDINGS, LTD.

                        By:  /s/ Henryk Sulikowski
                            ----------------------------------------------------
                        Name:  Henryk Sulikowski
                              --------------------------------------------------
                        Title: Senior Vice President and Chief Insurance Officer
                               -------------------------------------------------


                        BY SELLER:

                        SCOTTISH HOLDINGS, LTD.

                        By:  /s/ Karla Bodden
                            ---------------------------------------------------
                        Name:  Karla Bodden
                              -------------------------------------------------
                        Title: Director
                               ------------------------------------------------


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                                   EXHIBIT A


                             FINANCIAL STATEMENTS
<PAGE>

                                   EXHIBIT B

     Prior to the Closing, SAC will declare a dividend in the amount of
$12,213,031.15 and a return of capital in the amount of $23,591,346.11.  The
unaudited, pro forma balance sheet dated December 31, 1999 and the unaudited,
pro forma statement of income, shareholder's equity, and cash flows for the year
ending December 31, 1999 are attached to this Exhibit B.