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                                                                    Exhibit 10.7




                        ASPEN INSURANCE HOLDINGS LIMITED

                            2003 SHARE INCENTIVE PLAN

1. PURPOSE OF THE PLAN

                  The purpose of the Plan is to aid the Company and its
Affiliates in recruiting and retaining key employees or directors and to
motivate such employees or directors to exert their best efforts on behalf of
the Company and its Affiliates by providing incentives through the granting of
Awards. The Company expects that it will benefit from the added interest which
such key employees or directors will have in the welfare of the Company as a
result of their proprietary interest in the Company's success.

2. DEFINITIONS

                  The following capitalized terms used in the Plan have the
respective meanings set forth in this Section:

                  (a) "Act" means The Securities Exchange Act of 1934, as
                      amended, or any successor thereto.

                  (b) "Affiliate" means any entity directly or indirectly
                      controlling, controlled by, or under common control with,
                      the Company or any other entity designated by the Board in
                      which the Company or an Affiliate has an interest.

                  (c) "Award" means an Option, Share Appreciation Right,
                      Restricted Share or Other Share-Based Award granted
                      pursuant to the Plan.

                  (d) "Beneficial Owner" means a "beneficial owner", as such
                      term is defined in Rule 13d-3 under the Act (or any
                      successor rule thereto) (except that a Person shall be
                      deemed to have "beneficial ownership" of all Shares that
                      such Person has the right to acquire, whether such right
                      is exercisable immediately or only after the passage of
                      time).

                  (e) "Board" means the Board of Directors of the Company.

                  (f) "Change in Control" means,

                          (i) at any time that the Investors (as defined below)
                      are the Beneficial Owners of 33.33% or more of the
                      combined voting power of the voting shares of the Company,
                      the occurrence of any of the following events:

                          (A) the sale or disposition, in one or a series of
                      related transactions, of all or substantially all, of the
                      assets of the Company to any Person or Group (other than
                      (x) any subsidiary (as defined below) of the Company or
                      (y) any entity which is a holding company of the Company
                      (other than any holding company which became a holding
                      company in a transaction


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                                                                               2


                      that resulted in a Change in Control) or any subsidiary of
                      such holding company);

                          (B) any Person or Group is or becomes the Beneficial
                      Owner, directly or indirectly, of more than 50% of the
                      combined voting power of the voting shares of the Company
                      (or any entity which is the Beneficial Owner of more than
                      50% of the combined voting power of the voting shares of
                      the Company), including by way of merger, consolidation,
                      tender or exchange offer or otherwise; excluding, however,
                      the following: (I) any acquisition directly from the
                      Company, (II) any acquisition by the Company, or (III) any
                      acquisition by any employee benefit plan (or related
                      trust) sponsored or maintained by the Company or any
                      corporation controlled by the Company; or

                          (C) the consummation of any transaction or series of
                      transactions resulting in a merger, consolidation or
                      amalgamation, in which the Company is involved, other than
                      a merger, consolidation or amalgamation which would result
                      in the shareholders of the Company immediately prior
                      thereto continuing to own (either by remaining outstanding
                      or by being converted into voting securities of the
                      surviving entity), in the same proportion as immediately
                      prior to the transaction(s), more than 50% of the combined
                      voting power of the voting shares of the Company or such
                      surviving entity outstanding immediately after such
                      merger, consolidation or amalgamation; and

                          (ii) at any time that the Investors (as defined below)
                      are the Beneficial Owners of less than 33.33% of the
                      combined voting power of the voting shares of the Company,
                      the occurrence of any of the following events:

                          (A) the sale or disposition, in one or a series of
                      related transactions, of all or substantially all, of the
                      assets of the Company to any Person or Group (other than
                      (x) any subsidiary of the Company or (y) any entity that
                      is a holding company of the Company (other than any
                      holding company which became a holding company in a
                      transaction that resulted in a Change in Control) or any
                      subsidiary of such holding company);

                          (B) any Person or Group is or becomes the Beneficial
                      Owner, directly or indirectly, of more than 30% of the
                      combined voting power of the voting shares of the Company
                      (or any entity which is the Beneficial Owner of more than
                      50% of the combined voting power of the voting shares of
                      the Company), including by way of merger, consolidation,
                      tender or exchange offer or otherwise; excluding, however,
                      the following: (I) any acquisition directly from the
                      Company, (II) any acquisition by the Company, (III) any
                      acquisition by any employee benefit plan (or related
                      trust) sponsored or maintained by the Company or any
                      corporation controlled by the Company, or (IV) any
                      acquisition by a Person or Group


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                      if immediately after such acquisition a Person or Group
                      who is a shareholder of the Company on the Effective Date
                      continues to own voting power of the voting shares of the
                      Company that is greater than the voting power owned by
                      such acquiring Person or Group;

                          (C) the consummation of any transaction or series of
                      transactions resulting in a merger, consolidation or
                      amalgamation, in which the Company is involved, other than
                      a merger, consolidation or amalgamation which would result
                      in the shareholders of the Company immediately prior
                      thereto continuing to own (either by remaining outstanding
                      or by being converted into voting securities of the
                      surviving entity), in the same proportion as immediately
                      prior to the transaction(s), more than 50% of the combined
                      voting power of the voting shares of the Company or such
                      surviving entity outstanding immediately after such
                      merger, consolidation or amalgamation; or

                          (D) a change in the composition of the Board such that
                      the individuals who, as of the Effective Date, constitute
                      the Board (such Board shall be referred to for purposes of
                      this subsection (ii)(D) as the "Incumbent Board") cease
                      for any reason to constitute at least a majority of the
                      Board; provided, however, that for purposes of this
                      definition, any individual who becomes a member of the
                      Board subsequent to the Effective Date, whose election, or
                      nomination for election, by a majority of those
                      individuals who are members of the Board and who were also
                      members of the Incumbent Board (or deemed to be such
                      pursuant to this proviso) shall be considered as though
                      such individual were a member of the Incumbent Board; and,
                      provided further, however, that any such individual whose
                      initial assumption of office occurs as the result of or in
                      connection with either an actual or threatened election
                      contest (as such terms are used in Rule 14a-11 or
                      Regulation 14A of the Act) or other actual or threatened
                      solicitation of proxies or consents by or on behalf of an
                      entity other than the Board shall not be so considered as
                      a member of the Incumbent Board.

                      For purposes of this definition of Change in Control, (i)
                      "Investors" shall mean The Blackstone Group, Wellington
                      Underwriting plc, Candover Partners Limited, Credit Suisse
                      First Boston Private Equity, Montpelier Re Holdings Ltd.,
                      3i Group plc, Olympus Partners and Phoenix Equity Partners
                      or their respective Affiliates; (ii) "subsidiary" shall
                      mean, in respect of any entity, any other entity that is,
                      directly or indirectly, wholly owned by the first entity;
                      and (iii) "holding company" shall mean, in respect of any
                      entity, any other entity that, directly or indirectly,
                      wholly owns such first entity.

                  (g) "Code" means the Internal Revenue Code of 1986, as
                      amended, or any successor thereto.


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                  (h) "Committee" means the Compensation Committee of the Board
                      or the full Board, as determined by the Board.

                  (i) "Company" means Aspen Insurance Holdings Limited, a
                      Bermuda corporation.

                  (j) "Effective Date" means the date the Board approves the
                      Plan.

                  (k) "Employment" means (i) a Participant's employment if the
                      Participant is an employee of the Company or any of its
                      Affiliates and (ii) a Participant's services as an
                      non-employee director, if the Participant is a
                      non-employee member of the Board or the board of directors
                      of an Affiliate; provided, however, that unless otherwise
                      determined by the Committee, a change in a Participant's
                      status from employee to non-employee (other than a
                      director of the Company or an Affiliate) shall constitute
                      a termination of employment hereunder.

                  (l) "Fair Market Value" means, on a given date, (i) if there
                      is a public market for the Shares on such date, the
                      arithmetic mean of the high and low prices of the Shares
                      as reported on such date on the Composite Tape of the
                      principal national securities exchange on which such
                      Shares are listed or admitted to trading, or, if the
                      Shares are not listed or admitted on any national
                      securities exchange, the arithmetic mean of the per Share
                      closing bid price and per Share closing asked price on
                      such date as quoted on the National Association of
                      Securities Dealers Automated Quotation System (or such
                      market in which such prices are regularly quoted)(the
                      "NASDAQ"), or, if no sale of Shares shall have been
                      reported on the Composite Tape of any national securities
                      exchange or quoted on the NASDAQ on such date, then the
                      immediately preceding date on which sales of the Shares
                      have been so reported or quoted shall be used; provided
                      that, in connection with the grant of an Award on the date
                      of completion of an Initial Public Offering of the Shares,
                      the Fair Market Value on such date shall be the public
                      offering price, and (ii) if there is not a public market
                      for the Shares on such date, the Fair Market Value shall
                      be the value established by the Committee in good faith.

                  (m) "Group" means a "group", as such term is used for purposes
                      of Section 13(d)(3) or 14(d)(2) of the Act (or any
                      successor section thereto).

                  (n) "ISO" means an Option that is also an incentive stock
                      option granted pursuant to Section 6(d).

                  (o) "Initial Grant" has the meaning set forth in Section 3.

                  (p) "Initial Public Offering" means the initial public
                      offering by the Company of Shares pursuant to a
                      registration statement (other than a registration
                      statement on Form S-4 or Form S-8, or any other similar or
                      successor form) filed under the United States Securities
                      Act of 1933, as amended,


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                      and any successor thereto and declared effective by the
                      United States Securities and Exchange Commission.

                  (q) "Option" means a share option granted pursuant to Section
                      6.

                  (r) "Option Price" means the purchase price per Share of an
                      Option, as determined pursuant to Section 6(a).

                  (s) "Other Share-Based Awards" means awards granted pursuant
                      to Section 9.

                  (t) "Participant" means an employee or non-employee director
                      who is selected by the Committee to participate in the
                      Plan.

                  (u) "Person" means a "person", as such term is used for
                      purposes of Section 13(d) or 14(d) of the Act (or any
                      successor section thereto).

                  (v) "Plan" means the Aspen Insurance Holdings 2003 Share
                      Incentive Plan.

                  (w) "Restricted Shares" means any Share granted pursuant to
                      Section 8.

                  (x) "Shares" means ordinary shares, par value(pound)0.01 per
                      share, in the capital of the Company.

                  (y) "Share Appreciation Right" means a share appreciation
                      right granted pursuant to Section 7.

                  (z) "Subsidiary" means a subsidiary corporation, as defined in
                      Section 424(f) of the Code (or any successor section
                      thereto), of the Company.

3. SHARES SUBJECT TO THE PLAN

                  The total number of Shares that may be issued under the Plan
is 572,457. Awards to acquire 388,402 Shares will be granted promptly following
adoption of this Plan (the "Initial Grant"). The remaining 184,055 Shares may be
granted to new hires or as additional Awards, as and when determined in the sole
discretion of the Committee. The Shares may consist, in whole or in part, of
unissued Shares or previously issued Shares. The issuance of Shares or the
payment of cash upon the exercise of an Award or in consideration of the
cancellation or termination of an Award shall reduce the total number of Shares
available under the Plan, as applicable. Shares that are subject to Awards (or
portions thereof) that are forfeited, are cancelled, expire, terminate or lapse
without the payment of consideration may be granted again under the Plan.

4. ADMINISTRATION

                  (a) The Plan shall be administered by the Committee, which may
                      delegate its duties and powers in whole or in part to any
                      subcommittee thereof consisting solely of at least two
                      individuals who, during any period the Company is subject
                      to Section 16 of the Act, are intended to qualify as
                      "Non-Employee Directors" within the meaning of Rule 16b-3
                      under the


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                      Act (or any successor rule thereto) and, to the extent
                      required by Section 162(m) of the Code (or any successor
                      section thereto), "outside directors" within the meaning
                      thereof.

                  (b) The Committee shall have the full power and authority to
                      make, and establish the terms and conditions of, any Award
                      to any person eligible to be a Participant, consistent
                      with the provisions of the Plan and to waive any such
                      terms and conditions at any time (including, without
                      limitation, accelerating or waiving any vesting
                      conditions). Subject to Section 5(b), Awards may, in the
                      discretion of the Committee, be made under the Plan in
                      assumption of, or in substitution for, outstanding awards
                      previously granted by the Company or its Affiliates or a
                      company acquired by the Company or with which the Company
                      combines. The number of Shares underlying such substitute
                      awards shall be counted against the aggregate number of
                      Shares available for Awards under the Plan.

                  (c) The Committee is authorized to interpret the Plan, to
                      establish, amend and rescind any rules and regulations
                      relating to the Plan, and to make any other determinations
                      that it deems necessary or desirable for the
                      administration of the Plan, and may delegate such
                      authority, as it deems appropriate. The Committee may
                      correct any defect or supply any omission or reconcile any
                      inconsistency in the Plan in the manner and to the extent
                      the Committee deems necessary or desirable. Any decision
                      of the Committee in the interpretation and administration
                      of the Plan, as described herein, shall lie within its
                      sole and absolute discretion and shall be final,
                      conclusive and binding on all parties concerned
                      (including, but not limited to, Participants and their
                      beneficiaries or successors).

                  (d) The Committee shall require payment of any amount it may
                      determine to be necessary to withhold for federal, state,
                      local or other taxes as a result of the exercise, grant or
                      vesting of an Award. Unless the Committee specifies
                      otherwise, the Participant may elect to pay a portion or
                      all of such withholding taxes by (a) delivery in Shares or
                      (b) having Shares withheld by the Company with a Fair
                      Market Value equal to the minimum statutory withholding
                      rate from any Shares that would have otherwise been
                      received by the Participant.

5. LIMITATIONS

                  (a) No Award may be granted under the Plan after the tenth
                      anniversary of the Effective Date, but Awards theretofore
                      granted may extend beyond that date.

                  (b) Without the approval of the shareholders of the Company,
                      the Company shall not adjust an Option or Share
                      Appreciation Right or exchange an Option or Share
                      Appreciation Right with another Option or Share
                      Appreciation Right that would result in an Award with a
                      lower Option


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                      Price or exercise price (except for adjustments pursuant
                      to Section 10 of the Plan).

                  (c) Notwithstanding any provision of the Plan other than
                      Section 10, the number of Shares under the Plan that may
                      be issued in connection with grants of ISOs shall not
                      exceed 150,000 Shares.

6. TERMS AND CONDITIONS OF OPTIONS

                  Options granted under the Plan shall be, as determined by the
Committee, nonqualified or incentive stock options for federal income tax
purposes, as evidenced by the related Award agreements, and shall be subject to
the foregoing and the following terms and conditions and to such other terms and
conditions, not inconsistent therewith, as the Committee shall determine:

                  (a) Option Price. (i) Prior to the date of the Initial Public
                      Offering, the Option Price per Share shall be determined
                      by the Committee, and, in the case of ISOs, shall comply
                      with the requirements set forth in Section 6(d) of the
                      Plan, and (ii) after the date of the Initial Public
                      Offering, the Option Price per Share shall be determined
                      by the Committee, but shall not be less than 100% of the
                      Fair Market Value of the Shares on the date an Option is
                      granted.

                  (b) Exercisability. Options granted under the Plan shall be
                      exercisable at such time and upon such terms and
                      conditions as may be determined by the Committee, but in
                      no event shall an Option be exercisable more than ten
                      years after the date it is granted, except as may be
                      provided pursuant to Section 15.

                  (c) Exercise of Options. Except as otherwise provided in the
                      Plan or in an Award agreement, an Option may be exercised
                      for all, or from time to time any part, of the Shares for
                      which it is then exercisable. For purposes of this Section
                      6, the exercise date of an Option shall be the date a
                      notice of exercise is received by the Company, together
                      with payment (or to the extent permitted by applicable
                      law, provision for payment) of the full purchase price in
                      accordance with Section 6(c). The purchase price for the
                      Shares as to which an Option is exercised shall be paid to
                      the Company, as designated by the Committee, pursuant to
                      one or more of the following methods: (i) in cash or its
                      equivalent (e.g., by check); (ii) in Shares having a Fair
                      Market Value equal to the aggregate Option Price for the
                      Shares being purchased and satisfying such other
                      requirements as may be imposed by the Committee; provided,
                      that such Shares have been held by the Participant for no
                      less than six months, which period may be waived by the
                      Committee (or such other period as established from time
                      to time by the Committee in order to avoid adverse
                      accounting treatment applying generally accepted
                      accounting principles); (iii) partly in cash and partly in
                      such Shares; or (iv) if there is a public market for the
                      Shares at such time, through the delivery of irrevocable
                      instructions to a broker to sell Shares


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                                                                               8


                      obtained upon the exercise of the Option and to deliver
                      promptly to the Company an amount out of the proceeds of
                      such Sale equal to the aggregate Option Price for the
                      Shares being purchased. No Participant shall have any
                      rights to dividends or other rights of a shareholder with
                      respect to Shares subject to an Option until the
                      Participant has given written notice of exercise of the
                      Option, paid in full for such Shares and, if applicable,
                      has satisfied any other conditions imposed by the
                      Committee pursuant to the Plan.

                  (d) ISOs. The Committee may grant Options under the Plan to
                      Participants who are employees of the Company that are
                      intended to be ISOs. Such ISOs shall comply with the
                      requirements of Section 422 of the Code (or any successor
                      section thereto), including without limitation that the
                      Option Price shall not be less than 100% of the Fair
                      Market Value of the Shares on the date the ISO is granted.
                      No ISO may be granted to any Participant who at the time
                      of such grant, owns more than ten percent of the total
                      combined voting power of all classes of shares of the
                      Company or of any Subsidiary, unless (i) the Option Price
                      for such ISO is at least 110% of the Fair Market Value of
                      a Share on the date the ISO is granted and (ii) the date
                      on which such ISO terminates is a date not later than the
                      day preceding the fifth anniversary of the date on which
                      the ISO is granted. Any Participant who disposes of Shares
                      acquired upon the exercise of an ISO either (i) within two
                      years after the date of grant of such ISO or (ii) within
                      one year after the transfer of such Shares to the
                      Participant, shall notify the Company of such disposition
                      and of the amount realized upon such disposition. All
                      Options granted under the Plan are intended to be
                      nonqualified share options, unless the applicable Award
                      agreement expressly states that the Option is intended to
                      be an ISO. If an Option is intended to be an ISO, and if
                      for any reason such Option (or portion thereof) shall not
                      qualify as an ISO, then, to the extent of such
                      nonqualification, such Option (or portion thereof) shall
                      be regarded as a nonqualified share option granted under
                      the Plan; provided that such Option (or portion thereof)
                      otherwise complies with the Plan's requirements relating
                      to nonqualified share options. In no event shall any
                      member of the Committee, the Company or any of its
                      Affiliates (or their respective employees, officers or
                      directors) have any liability to any Participant (or any
                      other Person) due to the failure of an Option to qualify
                      for any reason as an ISO.

                  (e) Attestation. Wherever in this Plan or any agreement
                      evidencing an Award a Participant is permitted to pay the
                      exercise price of an Option or taxes relating to the
                      exercise of an Option by delivering Shares, the
                      Participant may, subject to procedures satisfactory to the
                      Committee, satisfy such delivery requirement by presenting
                      proof of beneficial ownership of such Shares, in which
                      case the Company shall treat the Option as exercised
                      without further payment and/or shall withhold such number
                      of Shares from the Shares acquired by the exercise of the
                      Option, as appropriate.


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7. TERMS AND CONDITIONS OF SHARE APPRECIATION RIGHTS

                  (a) Grants. The Committee may grant (i) a Share Appreciation
                      Right independent of an Option or (ii) a Share
                      Appreciation Right in connection with an Option, or a
                      portion thereof. A Share Appreciation Right granted
                      pursuant to clause (ii) of the preceding sentence (A) may
                      be granted at the time the related Option is granted or at
                      any time prior to the exercise or cancellation of the
                      related Option, (B) shall cover the same number of Shares
                      covered by an Option (or such lesser number of Shares as
                      the Committee may determine) and (C) shall be subject to
                      the same terms and conditions as such Option except for
                      such additional limitations as are contemplated by this
                      Section 7 (or such additional limitations as may be
                      included in an Award agreement).

                  (b) Terms. The exercise price per Share of a Share
                      Appreciation Right shall be an amount determined by the
                      Committee but in no event shall such amount be less than
                      the Fair Market Value of a Share on the date the Share
                      Appreciation Right is granted, except that,
                      notwithstanding the foregoing, in the case of a Share
                      Appreciation Right granted in conjunction with an Option,
                      or a portion thereof, the exercise price may not be less
                      than the Option Price of the related Option. Each Share
                      Appreciation Right granted independent of an Option shall
                      entitle a Participant upon exercise to an amount equal to
                      (i) the excess of (A) the Fair Market Value on the
                      exercise date of one Share over (B) the exercise price per
                      Share, times (ii) the number of Shares covered by the
                      Share Appreciation Right. Each Share Appreciation Right
                      granted in conjunction with an Option, or a portion
                      thereof, shall entitle a Participant to surrender to the
                      Company the unexercised Option, or any portion thereof,
                      and to receive from the Company in exchange therefor an
                      amount equal to (i) the excess of (A) the Fair Market
                      Value on the exercise date of one Share over (B) the
                      Option Price per Share, times (ii) the number of Shares
                      covered by the Option, or portion thereof, which is
                      surrendered. Payment shall be made in Shares or in cash,
                      or partly in Shares and partly in cash (any such Shares
                      valued at such Fair Market Value), all as shall be
                      determined by the Committee. Share Appreciation Rights may
                      be exercised from time to time upon actual receipt by the
                      Company of written notice of exercise stating the number
                      of Shares with respect to which the Share Appreciation
                      Right is being exercised. The date a notice of exercised
                      is received by the Company shall be the exercise date. No
                      fractional Shares will be issued in payment for Share
                      Appreciation Rights, but instead cash will be paid for a
                      fraction or, if the Committee should so determine, the
                      number of Shares will be rounded downward to the next
                      whole Share.

                  (c) Limitations. The Committee may impose, in its discretion,
                      such conditions upon the exercisability or transferability
                      of Share Appreciation Rights as it may deem fit.


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                                                                              10


8. RESTRICTED SHARES

                  (a) Grant. Subject to the provisions of the Plan, the
                      Committee shall determine the number of Restricted Shares
                      to be granted to each Participant, the duration of the
                      period during which, and the conditions, if any, under
                      which, the Restricted Shares may be forfeited to the
                      Company, and the other terms and conditions of such
                      Awards.

                  (b) Transfer Restrictions. Restricted Shares may not be sold,
                      assigned, transferred, pledged or otherwise encumbered,
                      except as provided in the Plan or the applicable Award
                      agreement. Certificates issued in respect of Restricted
                      Shares shall be registered in the name of the Participant
                      and deposited by such Participant, together with a stock
                      power endorsed in blank, with the Company. After the lapse
                      of the restrictions applicable to such Restricted Shares,
                      the Company shall deliver such certificates to the
                      Participant or the Participant's legal representative.

                  (c) Dividends. Dividends paid on any Restricted Shares may be
                      paid directly to the Participant, withheld by the Company
                      subject to vesting of the Restricted Shares pursuant to
                      the terms of the applicable Award agreement, or may be
                      reinvested in additional Restricted Shares, as determined
                      by the Committee in its sole discretion.

9. OTHER SHARE-BASED AWARDS

                  (a) Generally. The Committee, in its sole discretion, may
                      grant or sell Awards of Shares and Awards that are valued
                      in whole or in part by reference to, or are otherwise
                      based on the Fair Market Value of, Shares ("Other
                      Share-Based Awards"). Such Other Share-Based Awards shall
                      be in such form, and dependent on such conditions, as the
                      Committee shall determine, including, without limitation,
                      the right to receive, or vest with respect to, one or more
                      Shares (or the equivalent cash value of such Shares) upon
                      the completion of a specified period of service, the
                      occurrence of an event and/or the attainment of
                      performance objectives. Other Share-Based Awards may be
                      granted alone or in addition to any other Awards granted
                      under the Plan. Subject to the provisions of the Plan, the
                      Committee shall determine the number of Shares to be
                      awarded under (or otherwise related to) such Other
                      Share-Based Awards; whether such Other Share-Based Awards
                      shall be settled in cash, Shares or a combination of cash
                      and Shares; and all other terms and conditions of such
                      Awards (including, without limitation, the vesting
                      provisions thereof and provisions ensuring that all Shares
                      so awarded and issued shall be fully paid and
                      non-assessable).

10. ADJUSTMENTS UPON CERTAIN EVENTS

                  Notwithstanding any other provisions in the Plan to the
contrary, the following provisions shall apply to all Awards granted under the
Plan:


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                                                                              11



                  (a) Generally. In the event of any change in the outstanding
                      Shares after the Effective Date by reason of any Share
                      dividend or split, reorganization, recapitalization,
                      merger, consolidation, spin-off, combination, combination
                      or transaction or exchange of Shares or other corporate
                      exchange, or any distribution to shareholders of Shares
                      other than regular cash dividends or any transaction
                      similar to the foregoing, the Committee in its sole
                      discretion and without liability to any person shall make
                      such substitutions or adjustments as it deems to be
                      equitable, in its sole discretion, and necessary to
                      preserve the benefits or potential benefits intended to be
                      made available under this Plan as to (i) the number or
                      kind of Shares or other securities issued or reserved for
                      issuance pursuant to the Plan or pursuant to outstanding
                      Awards, (ii) the maximum number of Shares for which Awards
                      (including limits established for Restricted Shares or
                      Performance-Based Awards) may be granted during a calendar
                      year to any Participant, (iii) the Option Price or
                      exercise price of any Share Appreciation Right, and/or
                      (iv) any other affected terms of such Awards.

                  (b) Change in Control.

                      (i) In the event of a Change in Control after the
                      Effective Date, solely with respect to the Initial Grant,
                      without any action required, with respect to Awards
                      outstanding as of the date of such Change in Control (x)
                      all Options and Share Appreciation Rights shall become
                      fully and immediately exercisable and vested to the full
                      extent of the original grant, (y) the restrictions
                      applicable to any Restricted Shares shall lapse, and such
                      Restricted Shares shall become fully and immediately
                      vested, and (z) the restrictions and other conditions
                      applicable to any Other Share-Based Award shall lapse, and
                      such Other Share-Based Award shall become free of all
                      restrictions, limitations and conditions or, if
                      applicable, shall be considered earned and payable in full
                      and immediately settled or distributed.

                      (ii) In the event of a Change in Control after the
                      Effective Date, the Committee may, but shall not be
                      obligated to, (A) with respect to any Award other than the
                      Initial Grant, accelerate, vest or cause the restrictions
                      to lapse with respect to, all or any portion of an Award
                      or (B) cancel Awards for fair value (as reasonably
                      determined in the discretion of the Committee) which, in
                      the case of Options and Share Appreciation Rights, may
                      equal, but in any event shall not be less than, the
                      excess, if any, of value of the consideration to be paid
                      in the Change in Control transaction to holders of the
                      same number of Shares subject to such Options or Share
                      Appreciation Rights (or, if no consideration is paid in
                      any such transaction, the Fair Market Value of the Shares
                      subject to such Options or Share Appreciation Rights) over
                      the aggregate exercise price of such Options or Share
                      Appreciation Rights or (C) provide for the issuance of
                      substitute Awards that will substantially preserve the
                      otherwise applicable terms of any affected Awards
                      previously granted hereunder as determined


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                                                                              12


                      by the Committee in its sole discretion or (D) provide
                      that for a period of at least 15 days prior to the Change
                      in Control, such Options shall be exercisable as to all
                      Shares subject thereto and that upon the occurrence of the
                      Change in Control, such Options shall terminate and be of
                      no further force and effect.

11. NO RIGHT TO EMPLOYMENT OR AWARDS

                  The granting of an Award under the Plan shall impose no
obligation on the Company or any Affiliate to continue the Employment of a
Participant and shall not lessen or affect the Company's or Affiliate's right to
terminate the Employment of such Participant. No Participant or other Person
shall have any claim to be granted any Award, and there is no obligation for
uniformity of treatment of Participants, or holders or beneficiaries of Awards.
The terms and conditions of Awards and the Committee's determinations and
interpretations with respect thereto need not be the same with respect to each
Participant (whether or not such Participants are similarly situated).

12. SUCCESSORS AND ASSIGNS

                  The Plan shall be binding on all successors and assigns of the
Company and a Participant, including without limitation, the estate of such
Participant and the executor, administrator or trustee of such estate, or any
receiver or trustee in bankruptcy or representative of the Participant's
creditors.

13. NONTRANSFERABILITY OF AWARDS

                  Unless otherwise determined by the Committee, an Award shall
not be transferable or assignable by the Participant otherwise than by will or
by the laws of descent and distribution. An Award exercisable after the death of
a Participant may be exercised by the legatees, personal representatives or
distributees of the Participant.

14. AMENDMENTS OR TERMINATION

                  The Board or the Committee may amend, alter or discontinue the
Plan, but no amendment, alteration or discontinuation shall be made, (a) without
the approval of the shareholders of the Company, if such action would (except as
is provided in Section 10 of the Plan), increase the total number of Shares
reserved for the purposes of the Plan, (b) without the consent of a Participant,
if such action would diminish any of the rights of the Participant under any
Award theretofore granted to such Participant under the Plan or (c) without the
approval of the shareholders of the Company, to Section 5(b), relating to
repricing of Options or Share Appreciation Rights, to permit such repricing;
provided, however, that the Committee may amend the Plan in such manner as it
deems necessary to permit the granting of Awards meeting the requirements of the
Code or other applicable laws.

15. CONFLICTS OF LAW; INTERNATIONAL PARTICIPANTS

                  The Committee may, in its sole discretion, amend the terms of
the Plan or Awards in order (i) to comply with United States Federal law or the
rules of any securities exchange in


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                                                                              13


the United States or (ii) with respect to Participants who reside or work
outside the United States of America, to conform such terms with the
requirements of local law or to obtain more favorable tax or other treatment for
a Participant, the Company or an Affiliate, and the Committee may, where
appropriate, establish one or more sub-plans to reflect such amended or varied
provisions.

16. OTHER BENEFIT PLANS

                  All Awards shall constitute a special incentive payment to the
Participant and shall not be taken into account in computing the amount of
salary or compensation of the Participant for the purpose of determining any
benefits under any pension, retirement, profit-sharing, bonus, life insurance or
other benefit plan of the Company or under any agreement between the Company and
the Participant, unless such plan or agreement specifically provides otherwise.

17. CHOICE OF LAW

                  The Plan shall be governed by and construed in accordance with
the laws of Bermuda, without regard to conflicts of laws principles.

18. ARBITRATION

                  In the event of any controversy between a Participant and the
Company arising out of, or relating to, this Plan or an Award granted hereunder
which cannot be settled amicably by the parties, such controversy shall be
finally, exclusively and conclusively settled by mandatory arbitration conducted
expeditiously in accordance with the American Arbitration Association rules, by
a single independent arbitrator. If the parties are unable to agree on the
selection of an arbitrator, then either the Participant or the Company may
petition the American Arbitration Association for the appointment of the
arbitrator, which appointment shall be made within ten (10) days of the petition
therefor. Either party to the dispute may institute such arbitration proceeding
by giving written notice to the other party. A hearing shall be held by the
arbitrator in New York, London or Bermuda as agreed by the parties (or, failing
such agreement, in Bermuda) within thirty (30) days of his or her appointment.
The decision of the arbitrator shall be final and binding upon the parties and
shall be rendered pursuant to a written decision that contains a detailed
recital of the arbitrator's reasoning. Judgment upon the award rendered may be
entered in any court having jurisdiction thereof.

19. EFFECTIVENESS OF THE PLAN

                  The Plan shall be effective as of the Effective Date, subject
to the approval of the shareholders of the Company.