Exhibit 4.5





 


XL
GROUP plc


 


(formerly
XL Capital Limited)


 


1991 PERFORMANCE INCENTIVE PROGRAM


 


(AS AMENDED AND RESTATED ON May 13, 2016)


 




     


     


    

 


I. INTRODUCTION


 


A. Purpose of the Program


 


XL Group plc (the “Company”)
has established the Program to further its long-term financial success by offering stock, and stock-based compensation, to employees
of the Company whereby they can share in achieving and sustaining such success. The Program also provides a means to attract and
retain the executive talent needed to achieve the Company’s long-term growth and profitability objectives.


 


B. Definitions


 


When used in the Program, the following terms
shall have the meanings set forth below:


 


“Award(s)” shall mean Performance
Shares, Restricted Stock, Restricted Stock Units, Incentive Stock Options, Nonstatutory Stock Options, Stock Appreciation Rights
or Performance Units granted under the Program.


 


“Board” shall mean the Board
of Directors of the Company.


 


“Change in Control” shall mean
any of the following:


 


(i)         an
acquisition by any organization, corporation, individual, partnership, trust or any other entity or organization (including a governmental
entity and a “person” as that term is used under Section 13(d) or 14(d) of the Exchange Act) of beneficial ownership
(within the meaning of Rule 13d-3 under the Exchange Act) of 40% or more of either (A) the value of then outstanding equity securities
of XL Group plc (the “Outstanding Company Stock”) or (B) the combined voting power of the then outstanding voting securities
of XL Group plc entitled to vote generally in the election of directors (the “Outstanding Company Voting Securities”);
provided, however, that for purposes of this Program, the following acquisitions shall not constitute or result in a Change
in Control: (w) any acquisition directly from XL Group plc; (x) any acquisition by XL Group plc; (y) any acquisition by any employee
benefit plan (or related trust) sponsored or maintained by XL Group plc or one or more of its subsidiaries; or (z) any acquisition
by any entity pursuant to a Business Combination (as defined in (ii) below) that does not constitute a Change in Control under
clause (ii) below; or


 


(ii)          consummation
of a merger, scheme of arrangement, consolidation, amalgamation, exchange of securities, reorganization or similar transaction
involving XL Group plc or any of its subsidiaries, a sale or other disposition of all or substantially all of the consolidated
assets of XL Group plc, or the acquisition of assets or equity of another entity by XL Group plc or any of its subsidiaries (each
a “Business Combination”), in each case, unless, following such Business Combination, all or substantially all of the
individuals and entities who were the beneficial owners, respectively, of the Outstanding Company Stock and Outstanding Company
Voting Securities immediately prior to such Business Combination beneficially own, directly or indirectly, more than sixty percent
(60%) of the value of the then outstanding equity securities and the combined voting power of the then outstanding voting securities
entitled to vote generally in the election of members of the board of directors (or comparable governing body of an entity that
does not have such a board), as the case may be, of the entity resulting from such Business Combination (including, without limitation,
an entity which as a result of such transaction owns XL Group plc or all or substantially all of XL Group plc’s assets either
directly or through one or more subsidiaries) in substantially the same proportions as their ownership, immediately prior to such
Business Combination of the Outstanding Company Stock and Outstanding Company Voting Securities, as the case may be; or


 


(iii)          approval
by shareholders of the Company of the dissolution or complete liquidation of the Company; provided, however, that for purposes
of this Program, approval of such a dissolution or complete liquidation pursuant to a Business Combination (as defined above) that
does not constitute a Change in Control under clause (ii) above shall not constitute or result in a Change in Control; or


 




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(iv)          during
any period of two consecutive years, individuals who at the beginning of such period constituted the Board and any new directors
(excluding any new director whose initial assumption of office is in connection with an actual or threatened election contest,
including but not limited to a consent solicitation or proxy contest, relating to the election of directors of the Company) whose
appointment, election, or nomination for election was approved by a vote of at least two-thirds (2/3) of the directors then still
in office who either were directors at the beginning of the period or whose appointment, election or nomination for election was
previously so approved, cease for any reason to constitute a majority of the Board.


 


“Change in Control Price” shall
mean the price per share offered in respect of Common Stock in conjunction with any transaction resulting in a Change in Control
on a fully-diluted basis (or as determined in good faith by the Committee as constituted before the Change in Control, if any part
of the offered price is payable other than in cash) or, in the case of a Change in Control occurring solely by reason of a change
in the composition of the Board, the highest Fair Market Value of a share of Common Stock on any of the 30 trading days immediately
preceding the date on which a Change in Control occurs.


 


“Code” shall mean the United
States Internal Revenue Code of 1986, as amended.


 


“Committee” shall mean the entire
Board or the Compensation Committee, or such other committee or subcommittee of the Board as may be designated by the Board to
administer the Program.


 


“Common Stock” shall mean the
ordinary shares of the Company and may be either stock previously authorized but unissued, or stock reacquired by the Company.


 


“Company” shall mean XL Group
plc, an Irish company, any other entity in which XL Group plc owns 20% or more of the ordinary voting power or equity, and any
successor in a reorganization or similar transaction.


 


“Disability” shall mean the inability
of a Participant to perform the services normally rendered due to any physical or mental impairment that can be expected to be
of either permanent or indefinite duration, as determined by the Committee on the basis of appropriate medical evidence, and that
results in the Participant’s Termination of Employment; provided, however, that with respect to any Participant who
has entered into an employment agreement with the Company, the term of which has not expired at the time a determination concerning
Disability is to be made, Disability shall have the meaning attributed in such employment agreement.


 


“Exchange Act” shall mean the
U.S. Securities Exchange Act of 1934, as amended from time to time.


 


“Fair Market Value” shall mean
with respect to a given day, the closing sales price of Common Stock, as reported by such responsible reporting service as the
Committee may select, or if there were no transactions in the Common Stock on such day, then the last preceding day on which transactions
took place. The foregoing notwithstanding, the Committee may determine the Fair Market Value in such other manner as it may deem
more appropriate for Program purposes or as is required by applicable laws or regulations.


 


“Incentive Stock Option” or “ISO”
shall mean a right to purchase the Company’s Common Stock which is intended to comply with the terms and conditions for an
incentive stock option as set forth in Section 422 of the Code, or such other sections of the Code as may be in effect from time
to time.


 


“Nonstatutory Stock Option” or
“NQSO” shall mean a right to purchase the Company’s Common Stock which is not intended to comply with the terms
and conditions for a tax-qualified stock option, as set forth in Section 422 of the Code, or such other sections of the Code as
may be in effect from time to time.


 


“Participant” shall mean any
employee of the Company who, in the judgment of the Committee, is in a position to make a substantial contribution to the management,
growth, and success of the Company and is thus designated by the Committee to receive an Award. Members of the Board who are not
employees of the Company are not eligible to receive Awards under the Program.


 




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“Performance Goal” shall mean
any financial, statistical or other measure selected by the Committee, including without limitation (a) the attainment of a specified
financial or statistical objective or (b) the performance of the Company relative to a peer group as applicable to a specific Performance
Period.


 


“Performance Period” shall mean
a period set by the Committee over which Performance Shares or Performance Units may be earned. There may be more than one Performance
Period in existence at any one time, and the duration of Performance Periods may differ from each other.


 


“Performance Shares” shall mean
Common Stock granted to a Participant with respect to a Performance Period under Article III of the Program, together with any
other rights attached thereto or associated therewith including without limitation any right to receive cash in connection therewith.


 


“Performance Unit” shall mean
a cash award made pursuant to Section VI of the Program.


 


“Program” shall mean the Company’s
1991 Performance Incentive Program, as amended and restated herein.


 


“Restricted Stock” shall mean
a share of Common Stock granted to a Participant under Article IV of the Program. Restricted Stock awards entitle the Participant
to receive shares of Common Stock which have certain restrictions that lapse upon satisfaction of conditions imposed by the Committee
at the time of award.


 


“Restricted Stock Unit” shall
mean an award made under Article VII of the Program under which each unit represents a right to receive a share of Common Stock
upon the terms, and subject to the conditions, set forth by the Committee.


 


“Retirement” shall mean, except
as otherwise set forth in an Award agreement, a Participant’s Termination of Employment by reason of the Participant’s
retirement at his normal retirement date, pursuant to and in accordance with a pension, retirement or similar plan or other regular
retirement practice of the Company, or in accordance with the early retirement provisions thereof.


 


“Stock Appreciation Rights” or
“SARs” shall mean a right granted to a Participant under Article V of the Program, which grants the Participant the
right to receive the difference between the Fair Market Value of the Common Stock on the date of exercise and the price at which
the SAR was granted.


 


“Termination of Employment” shall
mean a cessation of the employee-employer relationship between a Participant and the Company for any reason.


 


II. PROGRAM ADMINISTRATION


 


A. Administration


 


The Program shall be administered by the
Committee. Subject to the express provisions of the Program, the Committee shall have full and exclusive authority to interpret
the Program, to prescribe, amend and rescind rules and regulations relating to the Program and to make all other determinations
deemed necessary or advisable in the implementation and administration of the Program; provided, however, that subject to
the express provisions hereof or unless otherwise required by applicable law or regulation, no action of the Committee shall adversely
affect the terms and conditions of any Award made to, or any rights hereunder or under any grant letter of, any Participant, without
such Participant’s consent. The Company and the Committee may delegate their authority to perform any of their functions
relating to administration of the Program to other persons with respect to Awards granted to Participants who are not officers
of the Company for purposes of Section 16 of the Exchange Act.


 


B. Participation


 


The Committee may, from time to time, make
all determinations with respect to selection of Participants and the Award or Awards to be granted to each Participant. In making
such determinations, the Committee may take into account the nature of the services rendered or expected to be rendered by the
respective Participants, their present and potential contributions to the Company’s success and such other factors as the
Committee in its discretion shall deem relevant.


 




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C. Maximum Number of Shares Available


 


Subject to adjustment as provided under Article
II, Paragraph D of the Program, the maximum number of shares which may be granted under the Program after February 27, 2009 is
23,969,264 plus shares which subsequently become available as a result of forfeitures, cancellation or expiration of Awards under
the Program. For each Restricted Stock, Restricted Stock Unit, Performance Unit, or Performance Share Award issued, the number
of shares of Common Stock available under the Program will be reduced by two shares, and for any other Award, the number of shares
of Common Stock available under the Program will be reduced by one share.


 


In the event that an Award issued under the
Program expires or is terminated unexercised as to any shares covered thereby, or shares are forfeited for any reason under the
Program, such shares shall thereafter be again available for issuance under the Program. At the Committee’s discretion, these
shares may be granted as stock options, Performance Shares, Restricted Stock, Restricted Stock Units, Performance Units, Stock
Appreciation Rights or any combination of these provided that the combined total number of shares granted does not exceed either
the overall share authorization described above or the specific share authorization set forth below for Performance Shares, Performance
Units, stock options, Stock Appreciation Rights, Restricted Stock and Restricted Stock Units. Forfeited Awards that counted as
two shares under the rule described above will result in the addition to shares available for issuance under the Program of two
available shares per share forfeited, but any subsequent issuance of those shares in the form of Restricted Stock, Restricted Stock
Units, Performance Units, or Performance Share Awards will result in a reduction of two shares available under the Program for
each share issued. For the avoidance of doubt and notwithstanding the first sentence of this paragraph, the following shares shall
not again become available for Awards or increase the number of shares available for issuance under the Program: (i) shares tendered
by the Participant or withheld by the Company in payment of the purchase price of a stock option issued under this Program, (ii)
shares tendered by the Participant or withheld by the Company to satisfy any tax withholding obligation with respect to an Award,
(iii) shares repurchased by the Company with proceeds received from the exercise of a stock option issued under this Program, and
(iv) shares subject to a Stock Appreciation Right issued under this Program that are not issued in connection with the settlement
of that Stock Appreciation Right upon its exercise.


 


Subject to adjustment as provided under Article
II, Paragraph D of the Program, (i) the maximum number of shares of Common Stock with respect to which stock options and Stock
Appreciation Rights may be granted during a calendar year to any Participant under the Program shall be 1,000,000 shares, and (ii)
with respect to Performance Shares, Performance Units, Restricted Stock or Restricted Stock Units intended to qualify, as set forth
in Article VIII, as performance-based compensation within the meaning of Section 162(m) of the Code, the maximum number of shares
of Common Stock subject to such awards granted during a calendar year to any Participant under the Program shall be the equivalent
of 500,000 shares, and the maximum amount of cash that may be payable under an award of Performance Units granted during a calendar
year to any Participant shall be equal to the Fair Market Value of 500,000 shares of Common Stock determined on the date of grant.


 


No Incentive Stock Options shall be granted
after April 29, 2018.


 


D. Adjustments


 


In the event of any equity restructuring
(within the meaning of FASB ASC Topic 718) that causes the per share value of shares to change, such as a stock dividend, stock
split, reverse stock split, split up, spin-off, rights offering or recapitalization through an extraordinary dividend, the Committee,
in order to prevent dilution or enlargement of Participants’ rights under the Program, shall substitute or adjust, as applicable,
(i) the number and kind of shares or other securities that may be issued under the Program or under particular forms of Awards,
(ii) the number and kind of shares or other securities subject to outstanding Awards, (iii) the exercise price applicable to outstanding
Awards, (iv) the annual limits set forth in Article II, Paragraph C of the Program, and (v) other value determinations applicable
to outstanding Awards.


 


In instances where another corporation or
other business entity is acquired by the Company, and the Company has assumed outstanding employee option grants under a prior
existing plan of the acquired entity, similar adjustments to those described in the previous paragraph are permitted at the discretion
of the Committee. In the event of any other change affecting the Common Stock reserved under the Program, such adjustment, if any,
as may be deemed equitable by the Board, shall be made to give proper effect to such event. Notwithstanding any provision hereof
to the contrary, i) no


 




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adjustment shall be made pursuant to this Article II.D. that
would cause any Award that is not otherwise deferred compensation pursuant to Section 409A of the Code to be treated as deferred
compensation pursuant to Section 409A of the Code, and ii) no adjustment may be made that reduces the amount to be paid up per
share to less than the par value of the share.


 


E. Registration Conditions


 


1. Unless issued pursuant to a registration
statement under the U.S. Securities Act of 1933, as amended, no shares shall be issued to a Participant under the Program unless
the Participant represents and agrees with the Company that such shares are being acquired for investment and not with a view to
the resale or distribution thereof, or such other documentation is provided by the Participant as may be required by the Company,
unless in the opinion of counsel to the Company such representation, agreement or documentation is not necessary to comply with
such Act.


 


2. Restrictions on the resale of shares shall
be evidenced on the stock certificate by the following legend (or other such legend as the Company deems appropriate):


 


“The shares represented by this certificate
have not been registered under the Securities Act of 1933, as amended. The shares cannot be offered, transferred or sold unless
(a) a registration statement under such Act is in effect with respect to such shares, or (b) a written opinion from counsel acceptable
to the Company is obtained to the effect that no such registration is required. The Company reserves the right to refuse the transfer
of such shares until such conditions have been fulfilled. The Articles of Association of the Company contain other restrictions
on share transfers.”


 


Any certificate issued at any time in exchange
or substitution for any certificate bearing such legend (or such other legend deemed appropriate by the Company) shall also bear
such a legend unless, in the opinion of counsel or the Company, the securities represented thereby need no longer be subject to
the restriction contained herein. The provisions of this paragraph shall be binding upon all subsequent holders of certificates
bearing such legend.


 


F. Committee Action


 


The Committee may, through Award agreements,
limit its discretion under this Program. To the extent such discretion is not specifically waived in an Award agreement, the Committee
shall retain such discretion.


 


G. No Option or SAR Repricing Without Shareholder Approval


 


Except as provided in Article II.D hereof
relating to certain anti-dilution adjustments, unless the approval of shareholders of the Company is obtained, ISOs, NQSOs and
SARs issued under the Program shall not be (i) amended to lower their exercise prices, (ii) cancelled in exchange for the grant
of any new stock options or SARs with lower exercise prices, or (iii) cancelled in exchange for cash, other property or the grant
of any new Award at a time when the exercise price of such ISOs, NSQOs or SARs is greater than the current Fair Market Value of
a share.


 


H. Award Vesting/Exerciseability/Distribution Limitations


 


Except in the case of death, disability,
retirement, involuntary termination, or in accordance with the provisions of Article IX, (i) Awards in the form of Performance
Shares and Restricted Stock shall not become vested on a date that is less than one year following the date that such Award is
granted, (ii) Awards in the form of Incentive Stock Options, Nonstatutory Stock Options and SARs shall not become vested or exercisable
on a date that is less than one year following the date that such Award is granted, and (iii) Awards in the form of Performance
Units and Restricted Stock Units shall not provide for distribution on a date that is less than one year following the date that
such Award is granted; provided, however, that notwithstanding the foregoing, Awards that result in the issuance of an aggregate
of up to 5% of the Shares reserved for issuance under Article II, Paragraph C may be granted to Participants without regard to
such minimum vesting, exercisability and distribution provisions.


 




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III. PERFORMANCE SHARES


 


A. Grant of Performance Shares


 


After selecting Participants who will receive
Awards of Performance of Shares for a given Performance Period, the Committee shall inform each such Participant of the Award to
be granted to the Participant at the completion of the Performance Period, and the applicable terms and condition of the Award.
The Committee shall cause to be issued to each Participant a grant letter specifying the number of Performance Shares under his
Award and the number of Performance Shares which may be awarded subject to the terms and conditions of such grant letter and the
Program.


 


B. Establishment of Performance Goals


 


1. The Committee shall establish the Performance
Goals for each Performance Period. The Committee shall also establish a schedule for such Performance Period setting forth the
percentage of the Performance Share Award which will be earned, based on the extent to which the Performance Goals for such Performance
Period are actually achieved, the date on which Performance Shares awarded hereunder shall vest, or the date on which such Performance
Shares shall be forfeited (in whole or in part) by the Company for failure to meet the Performance Goals, as specified by the Committee.


 


2. As promptly as practical after each Performance
Period, the Committee shall determine whether, or the extent to which, the Performance Goals have been achieved. Based on such
determination, the Participant shall be deemed to have earned the Performance Shares awarded to him, or a percentage thereof as
provided in any schedule established by the Committee. In addition, the Committee may, from time to time during a Performance Period
and consistent with the terms and conditions of applicable Awards and Performance Goals, determine that all or a portion of the
Performance Shares awarded to one or more Participants have been earned.


 


3. If during the course of a Performance
Period there should occur, in the opinion of the Committee, significant changes in economic conditions or in the nature of the
operations of the Company, or any other pertinent changes which the Committee did not foresee or accurately predict the extent
of in establishing the Performance Goals for such Performance Period and which, in the Committee’s sole judgment, have, or
are expected to have, a substantial effect on the performance of the Company during the Performance Period, the Committee may make
such adjustment to the Performance Goals or measurements of such Performance Goals as the Committee, in its sole judgment, may
deem appropriate.


 


C. Termination of Employment


 


In the event of a Participant’s Termination
of Employment prior to satisfaction of conditions related to outstanding Performance Share Awards for reasons other than discharge
or resignation, the Participant or the Participant’s estate or beneficiary, in the sole discretion of the Committee, may
be entitled to receive from Performance Shares held by the Corporation a pro rata number of shares with respect to that Performance
Share Award, or such other portion of the Award, if any, as the Committee shall determine. In the event of Termination of Employment
due to resignation or discharge, the Award will be cancelled, and the Participant shall not be entitled to any further consideration
with respect to the forfeited Performance Shares, subject to the discretion of the Committee to release restrictions on all or
any part of an Award.


 


IV. RESTRICTED STOCK


 


A. Grant of Restricted Stock


 


1. Following the selection of Participants
who will receive a Restricted Stock Award, the Committee shall inform each such Participant of the number of Restricted Stock shares
granted to the Participant and the terms and applicable conditions of the Award.


 


2. Each certificate for Restricted Stock
shall be registered in the name of the Participant and deposited, together with a stock power endorsed in blank, with the Company.


 




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B. Other Terms and Conditions


 


Company stock, when awarded pursuant to a
Restricted Stock Award, will be represented by a stock certificate registered in the name of the Participant who is granted the
Restricted Stock Award. Such certificate shall be deposited together with a stock power endorsed in blank with the Company. The
Participant shall be entitled to receive dividends and all other distributions during the restriction period and shall have all
shareholder’s rights with respect to such stock, if any, with the exception that: (1) the Participant may not transfer ownership
of the shares during the restriction period except by will or the laws of descent and distribution, (2) the Participant will not
be entitled to delivery of the stock certificate during the restriction period, (3) the Company will retain custody of the stock
during the restriction period, and (4) a breach of a restriction or a breach of the terms and conditions established by the Committee
pursuant to the Restricted Stock Award will cause a forfeiture of the Restricted Stock shares. The Committee may impose additional
restrictions, terms, or conditions upon the Restricted Stock Award.


 


C. Restricted Stock Award Agreement


 


Each Restricted Stock Award shall be evidenced
by a Restricted Stock Award agreement in such form and containing such terms and conditions not inconsistent with the provisions
of the Program as the Committee from time to time shall approve.


 


D. Termination of Employment


 


In the event of a Participant’s Termination
of Employment prior to satisfaction of conditions related to outstanding Restricted Stock Awards for reasons other than discharge
or resignation, the Participant or the Participant’s estate or beneficiary, in the sole discretion of the Committee, may
be entitled to receive from Restricted Stock shares held by the Corporation a pro rata number of shares with respect to that Restricted
Stock Award, or such other portion of the Restricted Stock Award, if any, as the Committee shall determine. In the event of Termination
of Employment due to resignation or discharge, all Restricted Stock shares held by the Company shall be forfeited, and the Participant
shall not be entitled to any further consideration with respect to the forfeited Restricted Stock shares, subject to the discretion
of the Committee to release of restrictions on all or any part of an Award, or unless otherwise stated in the Restricted Stock
agreement.


 


E. Payment for Restricted Stock


 


Restricted Stock Awards may be made by the
Committee under which the Participant shall, upon payment of the par value, or, in the alternative, under which the Participant
shall pay all (or any lesser amount than all) of the Fair Market Value of the stock, determined as of the date the Restricted Stock
Award is made, receive a Restricted Stock Award. If payment is required, such purchase price shall be paid as provided in the Restricted
Stock Award Agreement.


 


V. STOCK OPTIONS


 


A. Stock Option Terms and Conditions


 


All stock options granted to Participants
under the Program shall be evidenced by agreements which shall be subject to applicable provisions of the Program, and such other
provisions as the Committee may adopt, including the following provisions:


 


1. Price: The option price per share
of Nonstatutory Stock Options (NQSOs) and Incentive Stock Options (ISOs) shall not be less than 100 percent of the Fair Market
Value of a share of Common Stock on the date of grant.


 


2. Period: An ISO shall not be exercisable
for a term longer than ten years from date of its grant. NQSOs shall have a term not longer than ten years from the date of grant.


 


3. Time of Exercise: The Committee
may prescribe the timing of the exercise of the stock option and any minimums and installment provisions and may accelerate the
time at which a stock option becomes exercisable.


 




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4. Exercise Procedures: A stock option,
or a portion thereof, shall be exercised by delivery of notice of exercise to the Company or the Program administrator designated
from time to time by the Company and payment of the full price of the shares being purchased. Such notice shall be given in the
form designated from time to time by the Company.


 


5. Payment: The price of an exercised
stock option, or portion thereof, may be paid using any of the following:


 


(a) cash or check, bank draft or money order
payable to the order of the Company; or


 


(b) the delivery of shares of
Common Stock owned by the Participant, having an aggregate Fair Market Value as determined on the date of exercise equal to the
option price; or


 


(c) an arrangement with a broker
approved by the Company whereby payment of the exercise price is accomplished with the proceeds of the sale of Common Stock; or


 


(d) withholding shares of Common
Stock subject to the option with a Fair Market Value on the date of exercise equal to the exercise price; or


 


(e) such other means as the Company
may authorize; or


 


(f) a combination of any of the above.


 


The Committee may impose such limitations
and prohibitions on the use of any shares of Common Stock to exercise a stock option as it deems appropriate.


 


6. Special Rule for Incentive Stock Options:
Notwithstanding any other provisions of the Program, the aggregate Fair Market Value of the shares of Common Stock, determined
as of the time the stock option is granted, for which the Participant may first exercise Incentive Stock Options in any calendar
year shall not exceed U.S. $100,000 or such other individual employee grant limit as may be in effect under the Code.


 


7. Effect of Leaves of Absence: It
shall not be considered a Termination of Employment when a Participant is placed by the Company on military leave, sick leave or
other bona fide leave of absence. In case of such leave of absence, the employment relationship for Program purposes shall be continued
until the later of the date when such leave of absence equals ninety days or when the Participant’s right to reemployment
with the Company shall no longer be guaranteed either by statute or contract.


 


8. Termination of Employment: In the
event of Termination of Employment, the following provisions shall apply unless waived by the Committee, or as otherwise specifically
provided in the stock option Award agreement:


 


(a) Discharge for Cause: All outstanding
options shall be cancelled.


 


(b) Termination Other Than for Cause: Unless
and except as otherwise specified in a Participant’s agreement, all options shall expire on the earlier of (i) 90 days following
the Termination of Employment or (ii) the expiration of the full term of the option.


 


Notwithstanding the foregoing, the Committee may rescind the
right to exercise stock options following Termination of Employment if the Participant has been found to be directly or indirectly
engaged in any activity which is in competition with the Company or otherwise adverse to or not in the best interest of the Company.


 


B. Stock Appreciation Rights (SARs).


 


The Committee is authorized to grant SARs
to Participants on the following terms and conditions:


 


1. An SAR shall confer on the Participant
to whom it is granted a right to receive with respect to each share of Common Stock subject thereto, upon exercise thereof, the
excess of (1) the Fair Market Value of one share of Common


 




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Stock on the date of exercise over (2) the exercise price per
share of the SAR, as determined by the Committee as of the date of grant of the SAR (which shall not be less than the Fair Market
Value per Share on the date of grant of the SAR).


 


2. The Committee shall determine, at the
time of grant or thereafter, the time or times at which an SAR may be exercised in whole or in part (which shall not be more than
ten years after the date of grant of the SAR), the method of exercise, method of settlement, method by which shares of Common Stock
will be delivered or deemed to be delivered to Participants, whether or not an SAR shall be in tandem with any other Award, and
any other terms and conditions of any SAR. The Committee shall determine at the time of grant of the SAR the form of consideration
payable in settlement of the SAR (which may include shares of Common Stock or cash).


 


VI. PERFORMANCE UNIT AWARDS


 


A. Grant of Performance Unit Awards


 


After selecting Participants who will receive
Awards of Performance Unit Awards for a given Performance Period, the Committee shall inform each such Participant of the Award
to be granted to the Participant at the completion of the Performance Period, and the applicable terms and condition of the Award.
The Committee shall cause to be issued to each Participant a grant letter specifying the number of Performance Units under his
Award, the number of Performance Units which may be awarded subject to the terms and conditions of such grant letter and the Program,
the notional dollar value assigned to each Performance Unit and the target cash value opportunity of the Award.


 


B. Establishment of Performance Goals


 


1. The Committee shall establish the Performance
Goals for each Performance Period. The Committee shall also establish a schedule for such Performance Period setting forth the
percentage of the Performance Unit Award which will be earned, based on the extent to which the Performance Goals for such Performance
Period are actually achieved, the date on which Performance Units awarded hereunder shall vest, or the date on which such Performance
Units shall be forfeited (in whole or in part) by the Company for failure to meet the Performance Goals, as specified by the Committee.


 


2. As promptly as practical after each Performance
Period, the Committee shall determine whether, or the extent to which, the Performance Goals have been achieved. Based on such
determination, the Participant shall be deemed to have earned the Performance Units awarded to him, or a percentage thereof as
provided in any schedule established by the Committee. In addition, the Committee may, from time to time during a Performance Period
and consistent with the terms and conditions of applicable Awards and Performance Goals, determine that all or a portion of the
Performance Units awarded to one or more Participants have been earned.


 


3. If during the course of a Performance
Period there should occur, in the opinion of the Committee, significant changes in economic conditions or in the nature of the
operations of the Company, or any other pertinent changes which the Committee did not foresee or accurately predict the extent
of in establishing the Performance Goals for such Performance Period and which, in the Committee’s sole judgment, have, or
are expected to have, a substantial effect on the performance of the Company during the Performance Period, the Committee may make
such adjustment to the Performance Goals or measurements of such Performance Goals as the Committee, in its sole judgment, may
deem appropriate.


 


C. Termination of Employment


 


In the event of a Participant’s Termination
of Employment prior to the satisfaction of conditions related to outstanding Performance Unit Awards for reasons other than discharge
or resignation, the Participant, or the Participant’s estate or beneficiary, in the sole discretion of the Committee, may
be entitled to receive a pro-rata distribution of outstanding Performance Unit Awards. In the event of Termination of Employment
due to resignation or discharge, all Awards will be cancelled, and the Participant shall not be entitled to any further consideration
with respect to the forfeited Performance Units, subject to the discretion of the Committee.


 




    	 	10	 



     


    

 


VII. RESTRICTED STOCK UNITS


 


A. Grant of Restricted Stock Units


 


Following the selection of Participants who
will receive an award of Restricted Stock Units, the Committee shall inform each such Participant of the number of Restricted Stock
Units granted to the Participant and the terms and applicable conditions of the Restricted Stock Unit Award.


 


B. Other Terms and Conditions


 


Restricted Stock Unit Awards will provide
for the delivery of the number of shares of Common Stock equivalent to the number of Restricted Stock Units at the time and subject
to the terms and conditions set forth by the Committee. Delivery of shares of Common Stock pursuant to the Restricted Stock Unit
Awards will occur upon expiration of the deferral period specified by the Committee. In addition, Restricted Stock Unit Awards
shall be subject to such restrictions, including forfeiture conditions, as the Committee may impose. Prior to distribution of shares
of Common Stock under a Restricted Stock Unit Award, the Participant shall have no rights as a shareholder with respect to the
shares subject to the Award. In the discretion of the Committee, the Participant may have the right to receive equivalent payments
for dividends and other distributions, subject to the terms and conditions that the Committee in its discretion may impose.


 


C. Restricted Stock Unit Award Agreement


 


Each Restricted Stock Unit Award shall be
evidenced by a Restricted Stock Unit Award Agreement in such form and containing such terms and conditions, not inconsistent with
the provisions of the Program, as the Committee from time to time shall approve.


 


D. Termination of Employment


 


In the event of a Participant’s Termination
of Employment prior to satisfaction of conditions related to an outstanding Restricted Stock Unit Award for reasons other than
discharge or resignation, the Participant or the Participant’s estate or beneficiary, in the sole discretion of the Committee,
may be entitled to receive from the Restricted Stock Unit Award a pro rata number of shares with respect to the Restricted Stock
Unit Award, or such other portion of the Restricted Stock Unit Award, if any, as the Committee shall determine. In the event of
Termination of Employment due to resignation or discharge, all Restricted Stock Units held by the Participant shall be forfeited,
and the Participant shall not be entitled to any further consideration with respect to the forfeited Restricted Stock Units, subject
to the discretion of the Committee to release restrictions and deliver shares in respect of all or any part of an Award, or unless
otherwise stated in the Restricted Stock Unit Award Agreement.


 


VIII. PERFORMANCE AWARDS


 


A. Performance Awards Granted to Designated Participants


 


Subject to Article VIII.A.6 below, the provisions
of the Program are intended to ensure that all NQSOs and SARs granted hereunder to any Participant who is a “Covered Employee”
(within the meaning of Section 162(m) of the Code) at the time of exercise of such NQSOs or SARs qualify for exemption from the
limitation on deductibility imposed by Section 162(m) of the Code. Such NQSOs and SARs shall therefore be considered “Performance-Based
Compensation” within the meaning of Section 162(m) of the Code, and the Program shall be interpreted and operated consistent
with that intention.


 


The Committee may in its discretion designate
any other Award (other than NQSOs or SARs) as Performance-Based Compensation upon grant, in each case based upon a determination
that (i) the Participant is a Covered Employee with respect to such Award at the time of grant or may be a Covered Employee at
the time of settlement, and (ii) the Committee wishes such Award to be subject to this Article VIII and qualify for exemption from
the limitation on deductibility imposed by Section 162(m) of the Code. The Committee shall have the sole authority to specify which
Awards are to be granted in compliance with this Article VIII and treated as Performance-Based Compensation.


 


1. Performance Goals Generally. The
performance goals for Awards designated by the Committee as “Performance-Based Compensation” (“Performance Awards”)
shall consist of one or more business criteria and a targeted level or levels


 




    	 	11	 



     


    

 


of performance with respect to each of such criteria, as specified
by the Committee consistent with this Article VIII.A. Performance goals shall be objective and shall otherwise meet the requirements
of Section 162(m) of the Code and regulations thereunder (including Regulation 1.162-27 and successor regulations thereto). The
Committee may determine that such Performance Awards shall be granted, vested and/or settled upon achievement of any one performance
goal or that two or more of the performance goals must be achieved as a condition to grant, vesting and/or settlement of such Performance
Awards. Performance goals may differ for Performance Awards granted to any one Participant or to different Participants.


 


2. Business Criteria. The performance
goals upon which the grant, payment or vesting of a Performance Award are conditioned shall be based on one or more of the following
business criteria for the Company, on a consolidated basis, and/or for specified subsidiaries or business units of the Company
(except with respect to the total stockholder return and earnings per share criteria): (1) earnings per share; (2) revenues; (3)
cash flow (including operating cash flow, free cash flow, cash flow return on equity, and cash flow return on investment); (4)
return measures (including return on assets, return on investment, return on capital, and return on equity); (5) economic value
added; (6) operating margin; (7) net income; pretax earnings; pretax earnings before interest, depreciation and amortization; pretax
operating earnings after interest expense and before incentives, service fees, and extraordinary or special items; operating earnings;
(8) price of a share of Common Stock (including growth in share price and total stockholder return); (9) expenses/costs; (10) shareholders’
equity; (11) book value; and (12) any of the above goals as compared to the performance of a group of comparable companies approved
by the Committee or a published or special index deemed applicable by the Committee including, but not limited to, the Standard
& Poor’s 500 Stock Index.


 


3. Adjustment of Business Criteria.
The Committee may provide in any Performance Award that any evaluation of performance may include or exclude the impact, if any,
on reported financial results of any of the following events that occurs during a performance period: (a) asset write-downs, (b)
litigation or claim judgments or settlements, (c) changes in tax laws, accounting principles or other laws or provisions, (d) reorganization
or restructuring programs, (e) acquisitions or divestitures, (f) foreign exchange gains and losses or (g) gains and losses that
are treated as unusual or infrequently occurring items under Accounting Standards Codification Topic 225. Such inclusions or exclusions
shall be prescribed in a form and at a time that meets the requirements of Code Section 162(m) for qualification of the Award as
Performance-Based Compensation.


 


4. Performance Period; Timing for Established
Performance Goals. Achievement of performance goals in respect of Performance Awards shall be measured over a performance period,
as specified by the Committee. Performance goals shall be established by the earlier of the following dates: (i) 90 days after
the beginning of any performance period applicable to such Performance Awards, and (ii) the date on which twenty-five percent (25%)
of the performance period applicable to such Performance Awards has elapsed.


 


5. Settlement of Performance Awards; Other
Terms. Settlement of such Performance Awards shall be in cash, Common Stock or other property, in the discretion of the Committee.
The Committee may, in its discretion, reduce the amount of a settlement otherwise to be made in connection with such Performance
Awards, but may not exercise discretion to increase any such amount payable to a Participant in respect of a Performance Award
subject to this Article VIII.A. The Committee shall specify the circumstances in which such Performance Awards shall be paid or
forfeited in the event of Termination of Employment by the Participant prior to the end of a performance period or settlement of
Performance Awards.


 


6. In the event that applicable tax or securities
laws change to permit the Committee discretion to alter the governing business criteria or permit flexibility with respect to the
terms of any Award or Performance Awards without obtaining shareholder approval of such changes, the Committee shall have sole
discretion to make such changes without obtaining shareholder approval. In addition, in the event that the Committee determines
that it is advisable to grant Awards that are not intended to qualify as Performance-Based Compensation, the Committee may make
such grants without satisfying the requirements of Code Section 162(m) and base vesting on business criteria other than those set
forth in this Article VIII.


 


B. Written Determination


 


In the case of any Award intended to qualify under Section 162(m)
of the Code, all determinations by the Committee as to the establishment of performance goals or potential individual Performance
Awards, and as to the achievement of performance goals relating to Performance Awards subject to this Article VIII, shall be made
in writing.


 




    	 	12	 



     


    

 


IX. CHANGE IN CONTROL


 


A. Vesting Following Change in Control 


 


With respect to any Award, the Committee
in its sole discretion may provide for lapse of restrictions and accelerated vesting upon or after the occurrence a Change in Control;
provided, however, that no such accelerated vesting may occur unless the Participant has a Termination of Employment either
by the Company without “cause” or by the Participant for “good reason.”


 


B. Alternative Awards Following Change in Control


 


Notwithstanding Article IX.A above, the provisions
of Article IX.C shall apply in connection with a Change in Control with respect to any outstanding Award if any of the following
conditions is not (or will not be) satisfied with respect to such outstanding Award, as determined by the Committee as constituted
prior to the Change in Control:


 


1. Such outstanding Award is honored or assumed
by the surviving entity, or a new right is substituted in place of such outstanding Award (such honored or assumed Award, or new
right, are collectively referred to as an “Alternative Award”);


 


2. The Alternative Award is based on securities
that are, or will immediately following the Change in Control be, publicly traded on an established U.S. securities market;


 


3. The Alternative Award provides rights,
terms and conditions (including but not limited to vesting, exercisability, and timing and methods of payment) that are substantially
equal to, or more favorable than, the rights, terms and conditions of such outstanding Award;


 


4. The Alternative Award has substantially
equivalent economic value (measured at the time of the Change in Control) to such outstanding Award;


 


5. The Alternative Award provides that if
the Participant has a Termination of Employment within 2 years following the Change in Control either by the Company without “cause”
or by the Participant for “good reason,” the Alternative Award will become immediately vested and any conditions on
a Participant’s rights under, or any restrictions on transfer or exercisability applicable to, such Alternative Award shall
be waived or shall lapse, as the case may be; and


 


6. The Alternative Award will not subject
the Participant to the assessment of additional taxes or interest under Section 409A of the Code.


 


C. Accelerated Vesting and Payment.


 


In the event of a Change in Control where
the conditions set forth in Article IX.B are not met with respect to any outstanding Award, then the provisions of this Article
IX.C shall apply to such Award:


 


1. Options and SARs.  All
outstanding NQSOs, ISOs and SARs shall become fully vested and exercisable immediately prior to the Change in Control. The Committee
(as constituted prior to the Change in Control) shall provide that in connection with the Change in Control each NQSO, ISO and
SAR shall be cancelled in exchange for an amount (payable in accordance with Article IX.C.4 below) equal to the excess, if any,
of the Fair Market Value of a share of Common Stock on the date of the Change in Control over the exercise price for such NQSO,
ISO or SAR.


 


2. Restricted Stock and Restricted Stock
Units. All restrictions with respect to outstanding unvested Awards in the form of Restricted Stock and Restricted Stock Units
shall lapse, and such Awards shall become vested immediately prior to the Change in Control. The Committee (as constituted prior
to the Change in Control) shall provide that in connection with the Change in Control each Award in the form of Restricted Stock
and Restricted Stock Units shall be cancelled in exchange for an amount (payable in accordance with Article IX.C.4 below) equal
to the Change in Control Price multiplied by the number of shares of Common Stock covered by such Award.


 




    	 	13	 



     


    

 


3. Performance Shares and Performance
Units. Upon a Change in Control, each outstanding Performance Share and Performance Unit shall be treated as earned 100% at
target, or, in the discretion of the Committee, based upon actual performance through the date of the Change in Control; and in
either case cancelled in exchange for an amount (payable in accordance with Article IX.C.4 below) equal to the Change in Control
Price multiplied by the number of shares of Common Stock covered by such Award.


 


4. Payments. Payment of any amounts
calculated in accordance with this Article IX shall be made in cash or, if determined by the Committee (as constituted prior to
the Change in Control), in shares of the stock of the surviving entity having an aggregate fair market value equal to such amount,
or in a combination of such shares of stock and cash. All amounts payable hereunder shall be payable in full, as soon as reasonably
practicable, but in no event later than 10 business days, following the Change in Control. For purposes hereof, the fair market
value of one share of stock of the surviving entity shall be determined in good faith by the Committee (as constituted prior to
the Change in Control).


 


X. GENERAL PROVISIONS


 


A. Amendment and Termination of Program


 


The Board may, at any time and from time
to time, suspend or terminate the Program in whole or amend it from time to time in such respects as the Board may deem appropriate;
provided, however, that, without the consent of an affected Participant, no amendment, suspension, or termination of the Program
may adversely affect the rights of such Participant under any Award theretofore granted to him or her.


 


Notwithstanding any other provision of the
Program to the contrary, the Board may amend the Program, and the Board or the Committee may amend an Award agreement, to take
effect retroactively or otherwise, as deemed necessary or advisable for the purpose of conforming the Program or an Award agreement
to (i) any law relating to programs of this or similar nature, and to the administrative regulations and rulings promulgated thereunder,
(ii) any applicable exchange requirements, and (iii) any compensation recoupment policy adopted by the Company. By accepting an
Award under the Program, a Participant agrees to any amendment to the Program and any Award agreement made pursuant to this Article
X.A. without further consideration or action.


 


B. Government and Other Regulations


 


The right of the Company to issue Awards
under the Program shall be subject to all applicable laws, rules and regulations, and to such approvals by any government agencies
as may be required.


 


C. Other Compensation Plans and Programs


 


The Program shall not be deemed to preclude
the implementation by the Company of other compensation plans or programs which may be in effect from time to time.


 


D. Miscellaneous Provisions


 


1. No Right to Continue Employment:
Nothing in the Program or in any Award confers upon any Participant the right to continue in the employ of the Company or interferes
with or restricts in any way the rights of the Company to discharge any Participant at any time for any reason whatsoever, with
or without cause.


 


2. Non-Transferability: Except as
otherwise determined by the Committee and set forth in the applicable Award agreement, prior to being earned under Articles III,
IV, or VI, being exercised under Article V, or having shares distributed under Article VII, no right or interest of any Participant
in any Award under the Program shall be (a) assignable or transferable, except by will or the laws of descent and distribution
or a valid beneficiary designation taking effect at death made in accordance with procedures established by the Committee, or (b)
liable for, or subject to, any lien, obligation or liability, except to the extent that Non-Qualified Stock Options may be pledged
as security in a margin account for their exercise.


 




    	 	14	 



     


    

 


3. Designation of Beneficiary: A Participant,
in accordance with procedures established by the Committee, may designate a person or persons to receive, in the event of the Participant’s
death, (a) any payments with respect to which the Participant would then be entitled, and (b) the right to continue to participate
in the Program to the extent of such Participant’s outstanding Awards. Such designation shall be made upon forms supplied
by and delivered to the Company and may be revoked in writing.


 


4. Withholding Taxes: The Company
may require a payment from a Participant to cover applicable withholding for income and employment taxes. The Company reserves
the right to offset such tax payment from any other funds which may be due the Participant by the Company.


 


5. Program Expenses: Any expenses
of administering the Program shall be borne by the Company.


 


6. Construction of Program: The
interpretation of the Program and the application of any rules implemented hereunder shall be determined solely in accordance with
the laws of the State of New York.


 


7. Unfunded Program: The Program shall
be unfunded, and the Company shall not be required to segregate any assets which may at any time be represented by Awards. Any
liability of the Company to any person with respect to an Award under this Program shall be based solely upon any obligations which
may be created by this Program. No such obligation of the Company shall be deemed to be secured by any pledge or other encumbrance
on any property of the Company.


 


8. Benefit Plan Computations: Except
as otherwise determined by the Company, any benefits received or amounts paid to a Participant with respect to any Award granted
under the Program shall not have any effect on the level of benefits provided to or received by any Participant, or the Participant’s
estate or beneficiary, as part of any employee benefit plan (other than the Program) of the Company.


 


9. Pronouns, Singular and Plural:
The masculine maybe read as feminine, the singular as plural and the plural as singular as necessary to give effect to the Program.


 


E. Effective Dates


 


The amendment and restatement of the Program
will become effective on approval by the Board of the Company, subject to shareholder approval. All outstanding Awards shall remain
in effect until all outstanding awards have been earned, have been exercised or repurchased, have expired or have been cancelled.


 


F. Section 409A


 


It is intended that the Program and Awards
issued thereunder will comply with Section 409A of the Code (and any regulations and guidelines issued thereunder) to the extent
the Awards are subject thereto, and the Program and such Awards shall be interpreted on a basis consistent with such intent. The
Program and any Award agreements issued thereunder may be amended in any respect deemed by the Committee to be necessary in order
to preserve compliance with Section 409A of the Code. In the case of any Award that, for purposes of Section 409A of the Code,
was not earned and vested on December 31, 2004, that is treated as “deferred compensation” subject to Section 409A
of the Code and is held by a Participant who is subject to United States income tax, notwithstanding any provision in an Award
Agreement to the contrary, (i) in the case of any payment under the Award that is to be made upon a termination of employment or
other service, (x) such termination of employment or other service will be deemed to occur upon the Participant’s “separation
from service” with the Company (within the meaning of Treas. Reg. Section 1.409A-1(h)), and (y) if the Participant is deemed
on the date of his or her “separation from service” to be a “specified employee” (within the meaning of
Treas. Reg. Section 1.409A-1(i)), then with regard to any payment that is required to be delayed pursuant to Section 409A(a)(2)(B)
of the Code, such payment shall not be made prior to the earlier of (A) the expiration of the six (6)-month period measured from
the date of the Participant’s “separation from service,” or (B) the date of the Participant’s death (the
“Delay Period”); and, upon the expiration of the Delay Period, all payments delayed pursuant hereto (whether they would
have otherwise been payable in a single sum or in installments in the absence of such delay) shall be paid to the Participant in
a lump sum, and any remaining payments due under the Award shall be paid in accordance with the normal payment dates specified
for them, and (ii) in the case of any payment under the Award that is to be made upon a Change


 




    	 	15	 



     


    

 


in Control, for this purpose Change in Control shall mean a
transaction or event that constitutes both a Change in Control (as defined in the Program) and a “change in control event”
(as defined in Treas. Reg. Section 1.409A-3(i)(5)) with respect to the Company. The Company shall not have any obligation to indemnify
or otherwise protect any Participant from any obligation to pay any taxes pursuant to Section 409A of the Code.


 




    	 	16	 



     


    

 


ADDENDUM FOR FRENCH STOCK OPTIONS


 


The following additional provisions constitute
the 2002 French Stock Option Addendum (the “French Addendum”).


 


A.  Purpose of the French Addendum


 


The Committee has prescribed these additional
provisions to the Program to permit French Participants to be granted French Options under the Program and only modify the Program
as it relates to French Options granted under the Program to French Participants. These provisions apply to French Participants
notwithstanding any other provisions of the Program, and do not apply to or modify the Program in respect of any other Participants.


 


The Board has adopted these additional provisions
in accordance with Article II, Paragraph A of the Program.


 


B.  Definitions


 


		1.	When used in this French Addendum, the following terms shall have the meanings set forth below:



 


“Award” (or “stock option”)
shall mean a French Option granted under the terms of the French Addendum and the Program.


  


“Cause” shall mean:


 


a. conviction of the French Participant
of a felony involving moral turpitude or dishonesty;


 


b. the French Participant, in carrying out his or
her duties for the Company, has been guilty of (1) gross neglect or (2) wilful misconduct; provided, however, that any act or failure
to act by the French Participant shall not constitute Cause for this purpose if such act or failure to act was committed, or omitted,
by the French Participant in good faith and in a manner reasonably believed to be in the overall best interests of the Company.
The determination of whether the French Participant acted in good faith and that he or she reasonably believed his or her action
to be in the Company’s overall best interest will be in the reasonable judgment of the General Counsel of the Company, or,
if the General Counsel shall have an actual or potential conflict of interest, the Committee; or


 


c. the French Participant’s continued wilful
refusal to obey any appropriate policy or requirement duly adopted by the Company and the continuance of such refusal after receipt
of notice.


 


“Company” shall mean XL Group
plc, an Irish company.


 


“French Option” shall mean a right to acquire
stock granted under this French Addendum.


 


“French Participant” shall mean an employee
of a Group Company to whom a subsisting French Option has been granted under this French Addendum, and any reference to “Participant”
in the other provisions of this Program shall be construed as if it were a reference to “French Participant”.


 


“Group Company” shall mean XL Group plc,
an Irish Company, or any other entity in which XL Group plc owns 20% or more of the ordinary voting power or equity.


 


“Market Value” shall mean on any day the
market value of a share as derived from the closing price of the Company’s Common Stock on the composite tape of the New
York Stock Exchange, and any reference to “Fair Market Value” in the other provisions of the Program shall be construed
as though it were a reference to “Market Value” for the purposes of grants under this French Addendum.


 


“Trading Day” shall mean any day that the
New York Stock Exchange is open for business.


 




    	 	17	 



     


    

 


2. The following definitions in Article I Paragraph B of the
Program shall not apply to this French Addendum:


 


“Incentive Stock Option” or
“ISO”


 


“Nonstatutory Stock Option” or “NQSO”


 


“Performance Goal”


 


“Performance Period”


 


“Performance Shares”


 


“Performance Unit”


 


“Restricted Stock”


 


“Restricted Stock Unit”


 


“Stock Appreciation Rights” or “SARs”


 


C.  Provisions relating to performance shares, restricted
stock, performance unit awards, restricted stock units, and performance awards


 


Articles III, IV, VI, VII, and VIII of the
Program shall not apply to French Options.


 


D.  Participation


 


1. French Options may be granted to any employee including “PDG”
and managers “mandataires sociaux”.


 


2. No French Options may be granted to consultants who do not
have a work contract with the Company.


 


3. No French Options may be granted to an Administrator or member
of the Conseil de Surveillance who does not have a work contract with the Company.


 


4. No French Options may be granted to any employee who, at
the date of grant, holds shares representing 10% or more of the issued share capital of the Company.


 


E.  Price


 


1. The option price per share of French Options shall not be
less than:


 


A) for French Options relating to newly issued shares of Common
Stock, the higher of:


 


i) 100 percent of the Market Value of a share of Common Stock
on the date of grant; and


 


ii) 80 per cent of the average of the middle market quotations
for a share of Common Stock derived from the composite tape of the New York Stock Exchange for the 20 consecutive Trading Days
preceding the date of grant of such option.


 


B) for French Options relating to shares of Common Stock purchased
by the Company, the higher of:


 


i) 80 per cent of the average purchase price of a share of Common
Stock purchased by the Company; and


 


ii) 80 per cent of the average middle market quotations for
a share of Common Stock derived from the composite tape of the New York Stock Exchange for the 20 consecutive Trading Days preceding
the date of grant of such option.


 




    	 	18	 



     


    

 


2. The option price of a French Option shall be determined and
fixed at the date of grant and may be adjusted only upon the occurrence of any of the events specified under the French Code of
Commerce (section L. 225-181) in accordance with French law.


 


F.  Date of grant


 


No French Option may be granted:


 


1. during the 20 consecutive Trading Days after the payment
of a dividend;


 


2. during the 20 consecutive Trading Days after an increase
of capital reserved to the shareholders;


 


3. during the 10 consecutive Trading Days preceding the date
of publication of the consolidated accounts or any annual financial statements of the Company;


 


4. during the 10 consecutive Trading Days following the date
of publication of the consolidated accounts or any annual financial statements of the Company;


 


5. during the period starting on any date on which the corporate
management of the Company is aware of unpublished price-sensitive information and ending 10 Trading Days after the publication
of such information;


 


G.  Exercise following death of French Participant


 


The heirs of a deceased French Participant
may exercise the French Option during the period of six months following the date of death. The French Option may not be assigned
or transferred in any other circumstances, and any purported transfer, assignment, or charge shall cause the French Option to lapse
forthwith.


 


H.  Disposal of shares


 


Any disposal of Common Stock by a French
Participant less than four years after the date of grant, and regardless of whether he has left employment with the Company, shall
be accompanied by a notice of disposal sent by the French Participant to his employing company or former employing company within
one week of the disposal.


 


I.  Lapse of French Options


 


French Options granted under this French
Addendum shall lapse upon the first of the following events to occur:


 


1. the tenth anniversary of the date of grant of
the French Option;


 


2. the third anniversary of the Retirement or Disability
of the French Participant;


 


3. six months following the death of the French Participant;


 


4. unless otherwise provided in an Employment Agreement
between the French Participant and the Company, the third anniversary of the termination of the French Participant’s employment
by the Company not for Cause within two years following a Change in Control (the “Post-Change Period”);


 


5. ninety days following termination of the French
Participant’s employment by the Company not for Cause outside a Post-Change Period;


 


6. the last date of employment of the French Participant
if employment is terminated by the Company for Cause;


 


7. the French Participant being adjudicated bankrupt;
or


 




    	 	19	 



     


    

 


8. thirty days after the last date of employment
of the French Participant if employment terminates other than as set forth above in this paragraph.


 


J.  Exercise of French Options


 


1. Article V, Paragraphs A.1, A.2, A.3 and
A.6 of the Program shall not apply.


 


2. Subject to the time limits in Paragraph
I above, the French Options shall become exercisable according to the vesting schedule detailed in the French Participant’s
stock option agreement; provided, however, that the option shall be immediately exercisable in full upon termination of the French
Participant’s employment due to death or Disability.


 


3. The French Option may be exercisable in
whole or in part by the French Participant giving written notice of exercise to the Company or the Program administrator designated
from time to time by the Company stating the number of shares with respect to which the French Option is being exercised, in the
form prescribed by the Company. Such exercise shall be effective upon receipt of such notice by the Company or Program administrator
and payment in full of the option price.


 


4. When a French Option is exercised only
in part, the balance shall remain exercisable on the same terms as originally applied to the whole French Option and the Company
shall issue a new option certificate accordingly as soon as possible after the partial exercise.


 


5. The French Participant may exercise his
French Option at any time after the French Option becomes exercisable in accordance with Subparagraph 2 of this Paragraph J and
before the French Option lapses for any reason stated in Paragraph I of this French Addendum.


 




    	 	20	 



     


    

 


2002 ITALIAN STOCK OPTION ADDENDUM


 


The following additional provisions constitute
the 2002 Italian Stock Option Addendum (the “Italian Addendum”).


 


A.  Purpose of the Italian Addendum


 


The Committee has prescribed these additional
provisions to the Program to permit Italian Participants to be granted Italian Options under the Program and only modify the Program
as it relates to Italian Options granted under the Program to Italian Participants. These provisions apply to Italian Participants
notwithstanding any other provisions of the Program, and do not apply to or modify the Program in respect of any other Participants.


 


The Board has adopted these additional provisions
in accordance with Article II, Paragraph A of the Program.


 


B.  Definitions


 


1. When used in this Italian Addendum, the following terms shall
have the meanings set forth below:


 


“Award” shall mean an Italian
Option granted under the terms of the Italian Addendum and the Program.


 


“Cause” shall mean:


 


a. conviction of the Italian Participant
of a felony involving moral turpitude or dishonesty;


 


b. the Italian Participant, in carrying out his or
her duties for the Company, has been guilty of (1) gross neglect or (2) wilful misconduct; provided, however, that any act or failure
to act by the Italian Participant shall not constitute Cause for this purpose if such act or failure to act was committed, or omitted,
by the Italian Participant in good faith and in a manner reasonably believed to be in the overall best interests of the Company.
The determination of whether the Italian Participant acted in good faith and that he or she reasonably believed his or her action
to be in the Company’s overall best interest will be in the reasonable judgment of the General Counsel of the Company, or,
if the General Counsel shall have an actual or potential conflict of interest, the Committee; or


 


c. the Italian Participant’s continued wilful
refusal to obey any appropriate policy or requirement duly adopted by the Company and the continuance of such refusal after receipt
of notice.


 


“Date of Offer” shall mean the date of
the meeting during which the Committee resolves to grant Italian Options pursuant to Article II, Paragraph B of the Program.


 


“Fair Market Value” shall mean on any day
the market value of a share as derived from the closing price of the Company’s Common Stock on the composite tape of the
New York Stock Exchange.


 


“Italian Option” shall mean a right to
acquire stock granted under this Italian Addendum.


 


“Italian Participant” shall mean an Italian
resident employee of the Company to whom a subsisting Italian Option has been granted under this Italian Addendum, and any reference
to “Participant” in the other provisions of this Program shall be construed as if it were a reference to “Italian
Participant”.


 


2. The following definitions in Article I Paragraph B of the
Program shall not apply to this Italian Addendum:


 


“Incentive Stock Option” or “ISO”


 


“Nonstatutory Stock Option” or “NQSO”


 


“Performance Goal”


 


“Performance Period”


 




    	 	21	 



     


    

 


“Performance Shares”


 


“Performance Unit”


 


“Restricted Stock”


 


“Restricted Stock Units”


 


“Stock Appreciation Rights” or “SARs”


 


C.  Provisions relating to performance shares, restricted
stock, performance unit awards, restricted stock units, and performance awards


 


Articles III, IV, VI, VII, and VIII of the
Program shall not apply to Italian Options.


 


D.  Participation


 


1. Italian Options may be granted to any Italian resident employee
of the Company save for the exceptions listed in sub-paragraph 2 and 3 of this paragraph D.


 


2. No Italian Options may be granted to any person who is not
an employee of the Company.


 


3. No Italian Options may be granted to any employee who, at
the date of grant, holds either:


 


shares representing 10% or more of the issued
share capital of XL Group plc; or,


 


10% or more of the voting rights exercisable
in the ordinary general shareholders’ meeting.


 


E.  Price


 


1. The option price per share of Italian Options shall be:


 


a. for Italian Options relating to newly issued shares of Common
Stock, not less than 100 percent of the Fair Market Value of a share of Common Stock on the date of grant; and


 


b. for Italian Options relating to shares of Common Stock purchased
by the Company, not less than the nominal value of a Share


 


provided that such option price shall not be less than the average
of the middle market quotations for a share of Common Stock derived from the composite tape of the New York Stock Exchange for
the period commencing on the same date as the Date of Offer in the previous calendar month (or in the event that such date does
not exist, the last day of that preceding calendar month) and ending on the Date of Offer of such Italian Option.


 


F.  Exercise following death of Italian Participant


 


Italian Options may be assigned or otherwise transferred only
in the following circumstances:


 


1. by will or the laws of descent and distribution; or


 


2. by valid beneficiary designation taking effect at death made
in accordance with procedures established by the Committee.


 


G.  Lapse of Italian Options


 


Italian Options granted under this Italian Addendum shall lapse
upon the first of the following events to occur:


 




    	 	22	 



     


    

 


1. the tenth anniversary of the date of grant of the Italian
Option;


 


2. the third anniversary of the Retirement or Disability of
the Italian Participant;


 


3. six months following the death of the Italian Participant;


 


4. unless otherwise provided in an Employment Agreement between
the Italian Participant and the Company, the third anniversary of the termination of the Italian Participant’s employment
by the Company not for Cause within two years following a Change in Control (the “Post-Change Period”);


 


5. ninety days following termination of the Italian Participant’s
employment by the Company not for Cause outside a Post-Change Period;


 


6. the last date of employment of the Italian Participant if
employment is terminated by the Company for Cause;


 


7. the Italian Participant being adjudicated bankrupt; or


 


8. thirty days after the last date of employment of the Italian
Participant if employment terminates other than as set forth above in this paragraph.


 


H.  Exercise of Italian Options


 


1. Article V, Paragraphs A.1, A.2, A.3 and A.6 of the Program
shall not apply.


 


2. Subject to the time limits in Paragraph G above, the Italian
Options shall become exercisable according to the vesting schedule detailed in the Italian Participant’s stock option agreement;
provided, however, that the option shall be immediately exercisable in full upon termination of the Italian Participant’s
employment due to death or Disability.


 


3. The Italian Option may be exercisable in whole or in part
by the Italian Participant giving written notice of exercise to the Company or the Program administrator designated from time to
time by the Company stating the number of shares with respect to which the Italian Option is being exercised, in the form prescribed
by the Company. Such exercise shall be effective upon receipt of such notice by the Company or Program administrator and payment
in full to the Company of the option price.


 


4. When an Italian Option is exercised only in part, the balance
shall remain exercisable on the same terms as originally applied to the whole Italian Option and the Company shall issue a new
option certificate accordingly as soon as possible after the partial exercise.


 


5. The Italian Participant may exercise his Italian Option at
any time after the Italian Option becomes exercisable in accordance with Subparagraph 2 of this Paragraph H and before the Italian
Option lapses for any reason stated in Paragraph G of this Italian Addendum.


 




    	 	23	 



     


    

 


ADDITIONAL PROVISIONS FOR UK PARTICIPANTS


 


The following additional provisions constitute
the 2002 UK Approved Stock Option Appendix (the “UK Subplan”) for UK Participants.


 


A.  Purpose of the UK Subplan


 


The Committee has prescribed these additional
provisions to the Program to permit UK Participants to be granted Approved Options under the Program. These provisions are to be
read as a continuation of the Program and only modify the Program as it relates to Approved Options granted under the Program to
UK Participants. These provisions do not apply to or modify the Program in respect of any other Participants.


 


The Board has adopted these additional provisions
in accordance with Article II, Paragraph A of the Program.


 


In the event of any conflict between the
terms of the Program and the UK Subplan, the terms of the UK Subplan will take precedence insofar as Approved Options granted to
UK Eligible Employees are concerned.


 


B.  Definitions


 


1. When used in this UK Subplan, the following additional terms
shall have the meanings set forth below:


 


“Approved Option” shall mean a right to
acquire Common Stock granted under this UK Subplan to a UK Participant while this UK Subplan is approved by the UK Inland Revenue
under the Taxes Act.


 


“Associated Company” in relation to the
Company shall have the meaning given by s416 of the Taxes Act.


 


“Cause” shall mean:


 


a. conviction of the UK Participant
of a felony involving moral turpitude or dishonesty;


 


b. the UK Participant, in carrying out his or her
duties for the Company, has been guilty of (1) gross neglect or (2) wilful misconduct; provided, however, that any act or failure
to act by the UK Participant shall not constitute Cause for this purpose if such act or failure to act was committed, or omitted,
by the UK Participant in good faith and in a manner reasonably believed to be in the overall best interests of the Company. The
determination of whether the UK Participant acted in good faith and that he or she reasonably believed his or her action to be
in the Company’s overall best interest will be in the reasonable judgment of the General Counsel of the Company, or, if the
General Counsel shall have an actual or potential conflict of interest, the Committee; or


 


c. the UK Participant’s continued wilful refusal
to obey any appropriate policy or requirement duly adopted by the Company and the continuance of such refusal after receipt of
notice.


 


“Control” shall have the meaning
given by section 840 of the Taxes Act.


 


“Eligible Employee” shall mean:


 


a. any full-time director employed by a Participating
Company and required to devote not less than 25 hours per week to his duties (excluding meal breaks); or


 


b. any other employee of a Participating
Company


 


provided that the director or employee is not precluded
by paragraph 8 of Schedule 9 (material interest in a close company) from participating in this UK Subplan.


 


“Exchange Rate” shall mean, on any day
it falls to be calculated, the closing mid-point of the pound/dollar exchange rate quoted in the Financial Times on that day.


 




    	 	24	 



     


    

 


“Group Company” shall mean:


 


a. the Company; or


 


b. any company under the Control
of the Company.


 


“Participating Company” shall mean any
Group Company which is permitted by the Inland Revenue to participate in the Program and which is designated by the Committee as
a Participating Company or a jointly owned company for which the prior consent of the Inland Revenue has been obtained provided
that if any jointly owned company which has been nominated as a Participating Company ceases to satisfy the necessary Inland Revenue
requirements (unless as a consequence of such cessation if becomes under the control of the Company) it shall forthwith cease to
be a Participating Company.


 


“Schedule 9” shall mean Schedule 9 to the
Taxes Act.


 


“Taxes Act” shall mean the Income and Corporation
Taxes Act 1988.


 


“UK Subplan” shall mean the 2002 UK Approved
Stock Option Appendix, as amended from time to time.


 


2. When used in this UK Subplan, the following terms in Article
I, Provision B shall be modified as set forth below in relation to Approved Options only:


 


“Award” shall mean Approved Options granted
under the terms of the Program and the UK Subplan.


 


“Common Stock” shall mean the Class A
ordinary shares of the Company, par value of $0.01 per share, which satisfy the requirements of paragraph 10-14 of Schedule 9,
and may be either stock previously authorized but unissued, or stock acquired by the Company.


 


“Company” shall mean XL Group plc, and
Irish Company.


 


“Market Value” shall mean in respect of
a share comprised in an Approved Option:


 


a. On any day, the market value of a share as derived
from the mid-market price of the Company’s Common Stock on the composite tape of the New York Stock Exchange; or


 


b. If the shares are not for the time being fully
quoted on the New York Stock Exchange or the Daily Official List of the London Stock Exchange, the value of a share over which
such Approved Option is granted as determined by the Committee as at the date of grant and having regard to the provisions of Part
VIII of the Taxation of Chargeable Gains Act 1992 and agreed in advance with the Inland Revenue Shares Valuation Division. Any
reference to “Fair Market Value” in the other provisions of the Program shall be construed as though it were a reference
to “Market Value” for the purposes of grants under this UK Subplan.


 


“UK Participant” shall mean an Eligible
Employee to whom a subsisting Approved Option has been granted under this UK Subplan, and any reference to “Participant”
in the other provisions of this Program shall be construed as if it were a reference to “UK Participant”.


 


3. Terms and expressions not defined in this Paragraph B have
the same meaning as in section 185 and Schedule 9 of the Taxes Act, where appropriate.


 


4. References to any statutory provision are to that provision
as amended or re-enacted from time to time.


 


5. All references in the Program to Stock Appreciation Rights
and Incentive Stock Options shall not apply for the purposes of options granted under this UK Subplan.


 




    	 	25	 



     


    

 


C.  Administration


 


1. Article II, Paragraph A of the Program shall be modified
by the addition of the following words “No amendment to the UK Subplan or to this Program in so far as it applies to Approved
Options shall become effective unless and until it is approved by the UK Inland Revenue. No Approved Options may be granted unless
and until the UK Subplan is approved by the UK Inland Revenue.”


 


2. The rights and obligations of an option holder under the
terms of his contract of employment are not affected by his participation in this UK Subplan.


 


D.  Adjustments to share capital


 


1. Article II, Paragraph D shall be amended by the deletion
of the words “stock splits in the capitalization of the Company” and replaced by the following “any capitalization
(other than a scrip issue), rights issue, consolidation, subdivision, reduction or other variation of the share capital of the
Company”.


 


2. Article II, Paragraph D shall be amended by the deletion
of the second and third sentences beginning “In instances...” and finishing “...proper effect to such an
event”.


 


3. Article II, Paragraph D of the Program shall be modified
so that after the words “outstanding stock options shall be similarly adjusted”, the following words are inserted:


 


a. the aggregate amount payable on the exercise of an Approved
Option in full is not increased;


 


b. no adjustment shall be made without the prior approval of
the Inland Revenue; and


 


c. following the adjustment the shares of Common Stock continue
to satisfy the conditions specified in paragraph 10-14 inclusive of Schedule 9.”


 


E.  Provisions relating to performance shares, restricted
stock, restricted stock units, performance unit awards and performance awards


 


Articles II Paragraph F, III, IV, VI, VII, VIII, and X.D.4 of
the Program shall not apply to Approved Options.


 


F.  Grant of Approved Options


 


1. Approved Options granted to Eligible Employees chosen to
participate may be granted by deed. A single deed of grant may be executed in favor of any number of Eligible Employees.


 


2. The first sentence of Article V.A shall be deleted and replaced
with the following words;


 


“All Approved Options granted to UK Participants under
this UK Subplan shall be evidenced by option certificates stating:


 


a. the date of grant of the Approved Option;


 


b. the number and class of shares over which
the Approved Option is granted;


 


c. the option price payable for each share;


 


d. any condition as to exercise imposed
in accordance with Paragraph F.3 of the UK Subplan.”


 


3. The exercise of an Approved Option may be conditional upon
the satisfaction of objective corporate performance condition(s) imposed by the Committee at the date of grant. Any such performance
conditions shall be deemed waived in the event of a Change in Control, or termination of employment by reason of death or Disability.


 




    	 	26	 



     


    

 


G.  Price


 


Article V.A.1 shall be modified by the addition of the following
words;


 


“The option price per share of Approved Options shall
not be less than 100 percent of the Market Value of a share of Common Stock on the date of grant.”


 


H.  Period


 


Article V.A.2 shall be modified so that after the words “an
ISO” the words “or an Approved Option” shall be inserted.


 


I.  Time of Exercise


 


Article V.A.3 shall be deleted and replaced with the following
words;


 


“Time of Exercise: Subject to the time limit in Article
V.A.2, one-third of the Approved Options shall become exercisable on each of the first three anniversaries of the date of grant;
provided, however, that the option shall be immediately exercisable in full upon termination of the UK Participant’s employment
due to his or her death or Disability.


 


J.  Payment


 


Articles V.A.5.b, A.5.c, and A.5.d shall be deleted and replaced
with a new paragraph A.5.b as follows;


 


“by arrangements with the Company, which arrangements
shall have been approved in advance by the UK Inland Revenue.’


 


K.  Limit on value of Approved Options held


 


The following new paragraph shall be inserted after Article
V.A.6;


 


“Special Rule for Approved Options;
notwithstanding any other provision of the Program, the aggregate Market Value of the shares of Common Stock, determined at the
relevant grant dates (converted to pounds sterling at the Exchange Rate on the relevant dates of grant), which the UK Participant
may acquire on the exercise in full of all unexercised Approved Options then held by him under the UK Subplan and any other Inland
Revenue approved discretionary share option plan adopted by the Company and any Associated Company, shall not exceed GB£30,000
or such other amount as shall from time to time be specified in paragraph 28 of Schedule 9.”


 


L.  Lapse of Approved Options


 


Article V.A.8 shall be replaced by the following new paragraph;


 


1. Approved Options granted under this UK Subplan shall lapse
upon the first of the following events to occur:


 


a. the tenth anniversary of the date of grant of the Approved
Option;


 


b. the third anniversary of the Retirement or Disability of
the UK Participant;


 


c. the first anniversary of the death of the UK Participant;


 


d. unless otherwise provided in an Employment Agreement between
the UK Participant and the Company, the third anniversary of the termination of the UK Participant’s employment by the Company
not for Cause within two years following a Change in Control (the “Post-Change Period”);


 


e. ninety days following termination of the UK Participant’s
employment by the Company not for Cause outside a Post-Change Period;


 




    	 	27	 



     


    

 


f. the last date of employment of the UK Participant if employment
is terminated by the Company for Cause;


 


g. the UK Participant being adjudicated bankrupt; or


 


h. thirty days after the last date of employment of the UK Participant
if employment terminates other than as set forth in this paragraph.


 


M.  Exercise of Approved Options


 


1. No Approved Option may be exercised by an individual at any
time when he is precluded by paragraph 8 of Schedule 9 (material interest in a close company within the preceding 12 months) from
participating in this UK Subplan.


 


2. No Approved Option may be exercised at any time when the
shares which may be thereby acquired do not satisfy the conditions specified in paragraphs 10 - 14 of Schedule 9.


 


3. The Approved Option may be exercisable in whole or in part
by the UK Participant giving notice of exercise the Company or the Program administrator designated from time to time by the Company
stating the number of shares with respect to which the Approved Option is being exercised, in the form prescribed by the Company.
Such exercise shall be effective upon receipt of such notice by the Company or Program administrator and payment in full to the
Company of the option price.


 


4. Shares of Common Stock shall be allotted and issued pursuant
to a notice of exercise within 30 days of the date of exercise and a definitive share certificate issued to the option holder in
respect thereof. Save for any rights determined by reference to a date preceding the date of allotment, such shares of Common Stock
shall rank pari passu with the other shares of the same class in issue at the date of allotment.


 


5. When an Approved Option is exercised only in part, the balance
shall remain exercisable on the same terms as originally applied to the whole Approved Option and the Company shall issue a new
option certificate accordingly as soon as possible after the partial exercise.


 


6. The Approved Option maybe exercised by the personal representatives
of a deceased UK Participant during the period of one year following the date of death. The Approved Option may not be assigned
or transferred in any other circumstances, and any purported transfer, assignment, or charge shall cause the Approved Option to
lapse forthwith.


 


7. The UK Participant may exercise his Approved Option at any
time after the Approved Option becomes exercisable in accordance with Paragraph I of the UK Subplan and before the Approved Option
lapses for any reason stated in Paragraph L of the UK Subplan.


 


N.  Effective dates


 


In relation to Approved Options, Article
X.E shall be modified so that after the words “shareholder approval” the words “and the approval of the UK Inland
Revenue to the UK Subplan” shall be inserted.


 


O.  Exchange of Approved Options on a takeover


 


1. If any company (“the Acquiring Company”) obtains
Control of the Company within the circumstances specified in paragraph 15(1) of Schedule 9 to the Taxes Act, any UK Participant
may, by agreement with the Acquiring Company at any time within the period specified in paragraph 15(2) of that Schedule 9, release
his Approved Option (“the Old Option”) in consideration of the grant to him of a new approved option (“the New
Option”) which is equivalent to the Old Option (by virtue of satisfying the requirements of paragraph 15(3) of Schedule 9
of the Taxes Act) but relates to stock in a different company (whether the Acquiring Company itself or another company within its
group).


 


2. Where any New Options are granted pursuant to Paragraph O.1
above they shall be regarded for the purposes of the subsequent application of the provisions of this UK Subplan as having been
granted at the time when the corresponding Old Options were granted and, with effect from the date on which the New Options are
granted:


 




    	 	28	 



     


    

 


a. save for the definitions of “Participating Company”
and “Group Company” in Paragraph B of this UK Subplan, references to “the Company” (including the definition
in Paragraph B of this Subplan) shall be construed as being references to the Acquiring Company or such other company to whose
stock the New Options relate; and


 


b. references to “Common Stock” (including the definition
in Paragraph B of this Subplan) shall be construed as being references to stock in the Acquiring Company or stock in such other
company to which the New Options relate but references to Participating Company shall continue to be construed as if references
to the Company were references to XL Group plc.


 




    	 	29	 



     


    

 


Additional Provisions for Participants
in the Republic of Ireland


 


The following amendments to the Program shall apply insofar
as it relates to awards made to Participants in the Republic of Ireland.


 


		1	Article III.C – Performance Shares & Termination of Employment



 


Article III.C shall be deleted and replaced with the following:


 


In the event of a Participant’s Termination
of Employment prior to satisfaction of conditions related to outstanding Performance Share Awards for reasons other than discharge
or resignation, the Participant (or the Participant’s legal personal representative, in the event of his death), in the sole
discretion of the Committee, may be entitled to receive from Performance Shares held by the Company a pro rata number of shares
with respect to that Performance Share Award, or such other portion of the Award, if any, as the Committee shall determine. In
the event of Termination of Employment due to resignation or discharge, the Award will be cancelled, and the Participant shall
not be entitled to any further consideration with respect to the forfeited Performance Shares, subject to the discretion of the
Committee to release restrictions on all or any part of an Award.


 


		2	Article IV.D – Restricted Stock & Termination of Employment



 


Article IV.D shall be deleted and replaced with the following:


 


In the event of a Participant’s Termination
of Employment prior to satisfaction of conditions related to outstanding Restricted Stock Awards for reasons other than discharge
or resignation, the Participant (or the Participant’s legal personal representative, in the event of his death), in the sole
discretion of the Committee, may be entitled to receive from Restricted Stock shares held by the Corporation a pro rata number
of shares with respect to that Restricted Stock Award, or such other portion of the Restricted Stock Award, if any, as the Committee
shall determine. In the event of Termination of Employment due to resignation or discharge, all Restricted Stock shares held by
the Company shall be forfeited, and the Participant shall not be entitled to any further consideration with respect to the forfeited
Restricted Stock shares, subject to the discretion of the Committee to release of restrictions on all or any part of an Award,
or unless otherwise stated in the Restricted Stock agreement.


 


		3	Article VI.C – Performance Unit Awards & Termination of Employment



 


Article VI.C shall be deleted and replaced with the following:


 


In the event of a Participant’s Termination
of Employment prior to the satisfaction of conditions related to outstanding Performance Unit Awards for reasons other than discharge
or resignation, the Participant (or the Participant’s legal personal representative, in the event of his death), in the sole
discretion of the Committee, may be entitled to receive a pro-rata distribution of outstanding Performance Unit Awards. In the
event of Termination of Employment due to resignation or discharge, all Awards will be cancelled, and the Participant shall not
be entitled to any further consideration with respect to the forfeited Performance Units, subject to the discretion of the Committee.


 


		4	Article VII.D – Restricted Stock Units & Termination of Employment



 


Article VII.D shall be deleted and replaced with the following:


 


In the event of a Participant’s Termination
of Employment prior to satisfaction of conditions related to an outstanding Restricted Stock Unit Award for reasons other than
discharge or resignation, the Participant (or the Participant’s legal personal representative, in the event of his death),
in the sole discretion of the Committee, may be entitled to receive from the Restricted Stock Unit Award a pro rata number of shares
with respect to the Restricted Stock Unit Award, or such other portion of the Restricted Stock Unit Award, if any, as the Committee
shall determine. In the event of Termination of Employment due to resignation or discharge, all Restricted Stock Units held by
the Participant shall be forfeited, and the Participant shall not be entitled to any further consideration with respect to the
forfeited Restricted Stock Units, subject to the discretion of the Committee to release restrictions and deliver shares in respect
of all or any part of an Award, or unless otherwise stated in the Restricted Stock Unit Award Agreement.


 




    	 	30	 



     


    

 


 


		5	Article X.D Miscellaneous Provisions



 


Paragraphs 1, 2 and 3 of Article X.D shall be deleted and replaced
with the following:


 


1. No Right to Continue Employment:
Subject to the relevant provisions of local employment law governing the employment of a Participant, nothing in the Program or
in any Award confers upon any Participant the right to continue in the employ of the Company or interferes with or restricts in
any way any rights that the Company may have to discharge any Participant at any time for any reason whatsoever, with or without
cause. Awards made under the Plan, and any other awards the Company may grant in the future to a Participant, even if such awards
are made repeatedly or regularly, and regardless of their amount, (a) are wholly discretionary, are not a term or condition of
employment and do not form part of a contract of employment, or any other working arrangement, between the Participant and the
Company or any Subsidiary, as applicable, (b) do not create any contractual entitlement to receive future awards or to continued
employment, and (c) do not form part of salary or remuneration for purposes of determining pension payments or any other purposes,
including, without limitation, termination indemnities, severance, resignation, redundancy, bonuses, long-term service awards,
pension or retirement benefits, or similar payments, except as otherwise required by applicable law.


 


2. Non-Transferability: Except as
otherwise determined by the Committee and set forth in the applicable Award agreement, prior to being earned under Articles III,
IV, or VI, being exercised under Article V, or having shares distributed under Article VII, no right or interest of any Participant
in any Award under the Program shall be (a) assignable or transferable, except by will or the laws of descent and distribution,
or (b) liable for, or subject to, any lien, obligation or liability, except to the extent that Non-Qualified Stock Options may
be pledged as security in a margin account for their exercise.


 


3. [Intentionally Omitted]


 




    	 	31