Document:

Exhibit 4.1 - Extract of the Minutes of a Meeting of a Subcommittee of the
      Finance and Risk Oversight Committee held on March 39, 2007

    EXHIBIT
      4.1

     

    Security
      Capital Assurance Ltd

    Extract
      of the Minutes of a Meeting of 

    a
      Subcommittee of the Finance and Risk Oversight Committee held on March 29,
      2007;
      which 

    Subcommittee
      has been established pursuant to meetings of the Board of Directors held on
      

    February
      27, 2007 and the meetings of 

    the
      Finance and Risk Oversight Committee held on March 23, 2007.

     

     

    
      1.           
        Background

    

     

    WHEREAS,
      at a meeting held on February 27, 2007, the Board of Directors (the “Board of
      Directors”) of Security Capital Assurance Ltd (the “Company”) resolved that the
      Company may issue and sell (the “Issuance”), at any time or from time to time,
      up to US$350 million of long-term debt and/or preference securities and
      delegated to the Finance and Risk Oversight Committee of the Board of Directors
      (the “FROC”) and/or any subcommittee thereof appointed thereby, either of which
      committees or subcommittees being given full power to sub-delegate to a
      subcommittee appointed thereby, the right and power to determine all of the
      terms and conditions of each and any such Issuance (including, without
      limitation, the terms and conditions of any such securities, the manner of
      issuance and sale thereof, all pricing and pricing-related terms, and whether
      or
      not any replacement capital covenant ought to be provided for rating agency
      and/or similar purposes, and to execute under hand or seal any other documents,
      agreements, contracts, instruments and certificates to which the Company is
      a
      party or is affected, and considered to be necessary, desirable or advisable
      to
      in connection with any such Issuance).

     

    WHEREAS,
      at a meeting of the FROC held on March 23, 2007 the FROC approved certain
      transactions and documents generally and delegated to a subcommittee (the
“Subcommittee”) consisting of Paul S Giordano, Michael P. Esposito and Robert M.
      Lichten the full right and power to determine all of the terms and conditions
      of
      each and any such issuance. 

     

    WHEREAS,
      the purpose of this meeting (the “Meeting”) is for the Subcommittee, on behalf
      of the Board of Directors, to consider approving (i) the issuance of the
      Fixed/Floating Series A Perpetual Non-Cumulative Preference Shares, liquidation
      preference of either, as shall be decided at the discretion of either Paul
      Giordano or Claude LeBlanc, US$25 or US$1,000 per share (the “Series A
      Preference Shares”), which may be issued pursuant to the Purchase Agreement (the
“Purchase Agreement”) between the Company and Lehman Brothers Inc., Merrill
      Lynch, Pierce, Fenner & Smith Incorporated and Wachovia Capital Markets,
      LLC, as the representatives of the several initial purchasers named therein
      (the
“Initial Purchasers”), (ii) the execution and delivery of the Replacement
      Capital Covenant, (iii) the execution and delivery of the Purchase
      Agreement, (iv) the execution and delivery of the Registration Rights Agreement
      and (v) such other matters as they deem necessary, desirable or advisable to
      complete the transactions in connection with the Issuance. The Series A
      Preference Shares will be issued pursuant to an offering memorandum (the
“Offering Memorandum”) which will be submitted confidentially to a limited
      number of U.S. institutional investors and Non-U.S. investors.

     

    WHEREAS,
      there were circulated and described as to their provisions at the Meeting the
      following documents:

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

       (i)   the
      Purchase Agreement;

     

      (ii)   the
      Registration Rights Agreement;

     

     (iii)   the
      Replacement Capital Covenant; and

     

    (iv)   the
      preliminary offering memorandum (the “Preliminary Offering
      Memorandum”).

     

    The
      above
      documents are hereinafter collectively referred to as the “Documents.” The
      transactions described in and contemplated by the Documents are hereinafter
      collectively referred to as the “Transactions.”

     

    2.           
      Resolutions

     

    NOW
      THEREFORE, after full and careful consideration of the terms of the Documents
      and the Transactions as contemplated thereby, the nature and scale of the
      liabilities and obligations to be undertaken thereunder and of the commercial
      and financial consequences, direct and indirect, of the execution of the
      Documents and the consummation of the Transactions as contemplated thereby,
      in
      so far as they affect the Company, upon motion duly made and seconded, the
      following resolutions are unanimously adopted by the Subcommittee. On behalf
      of
      the Board of Directors, it is:

     

    
      	
              3.1

            	
              Transaction
                and Documents

            

    

     

    RESOLVED
      that the Transactions and the Documents substantially in the forms presented
      to
      the Subcommittee be approved and that the Company execute and deliver, to the
      extent the Company is a party thereto, or approve all such deeds, contracts,
      agreements, documents, instruments and certificates (including, without
      limitation, the Documents) as any officer of the Company in his or her
      discretion shall determine or deem necessary, desirable or advisable in
      connection with the Transactions, the execution and delivery by any such officer
      of any such contract, agreement, document or certificate being conclusive
      evidence of such determination; and

     

    
      	
              3.2

            	
              Designation
                and Offering of Fixed/Floating Rate Preference
                Shares

            

    

     

    RESOLVED
      that (i) a series of 250,000 preference shares in the capital of the Company
      be
      designated as “Fixed/Floating Series A Perpetual Non-Cumulative Preference
      Shares,” and (ii) such Series A Preference Shares be issued on the terms of and
      in accordance with the Memorandum of Association of the Company (the “Memorandum
      of Association”), Bye-laws and the Purchase Agreement;

     

    FURTHER
      RESOLVED that the Series A Preference Shares shall be offered only to qualified
      institutional buyers (“QIBs”) in reliance on Rule 144A under the Securities Act
      of 1933, as amended (the “Securities Act”), and non-U.S. Persons under
      Regulation S, in accordance with the descriptions of the registration rights
      and
      transfer restrictions set forth in the Preliminary Offering Memorandum and
      the
      Offering Memorandum and in the Registration Rights Agreement,

     

    
      
        
        

      

      
        -2-

        
          

        

      

      
        
        

      

    

    and
      that
      the responsible officers shall have the authority to adopt such procedures
      as
      they determine are necessary in order to comply with the provisions thereto;
      and

     

    FURTHER
      RESOLVED that the Issuance shall be subject to the Company’s agreement to file
      with the United States Securities and Exchange Commission either an exchange
      offer registration statement or a shelf registration statement on the
      appropriate form under the Securities Act with respect to the exchange
      preference shares (the “Exchange Preference Shares”) on the terms of and in
      accordance with the Registration Rights Agreement, which, pursuant to the terms
      of the Purchase Agreement, contemplates an exchange, registered under the
      Securities Act, of Exchange Preference Shares with terms similar to the
      Preference Shares (the “Exchange Offer”), and that the responsible officers
      shall have the authority to adopt such procedures and execute such ancillary
      documentation as they determine are necessary in order to comply with the
      provisions thereto and issue the Exchange Preference Shares.

     

    
      	
              3.3

            	
              Series
                A Preference Shares

            

    

     

    RESOLVED
      that the Series A Preference Shares (i) will have, on the date the Transactions
      are consummated (the “Closing Date”), an aggregate liquidation preference of
      either, as shall be decided at the discretion of either Paul Giordano or Claude
      LeBlanc, US$25 or US$1,000 (the “Series A Aggregate Available Liquidation
      Preference”), and (ii) be non-cumulative preference shares with a nominal par
      value of US$0.01 per share; and

     

    FURTHER
      RESOLVED that the Series A Preference Shares have, subject to the Memorandum
      of
      Association, the Bye-laws of the Company, the provisions of, and restrictions
      contained in, the Companies Act 1981 of Bermuda, as amended, and every statutory
      modification or re-enactment thereof for the time being in force (the “Law”),
      the following preferences and rights and be subject to the following
      restrictions.

     

    
      	
              (a)

            	
              Liquidation
                Preference

            

    

     

    Upon
      any
      voluntary or involuntary liquidation, dissolution or winding up of the Company,
      the assets of the Company legally available for distribution among shareholders
      shall be applied first in repaying to the holders of the Series A Preference
      Shares (the “Series A Holders”) an amount equal to either, as shall be decided
      at the discretion of either Paul Giordano or Claude LeBlanc, US$25 or US$1,000
      per Series A Preference Share (inclusive of the nominal amount thereof) plus
      any
      declared and unpaid dividends with respect to the then-current Series A Dividend
      Period to the date fixed for distribution in preference to the repayment of
      the
      nominal amount of and any share premium or other amounts paid on common shares
      of the Company (the “Common Shares”) or any other shares ranking junior in right
      of payment to the Series A Preference Shares as to dividends and the
      distribution of assets upon any liquidation, dissolution or winding up of the
      Company (together with the Common Shares, the “Series A Junior Shares”) to the
      holders of such Series A Junior Shares, without interest on such declared and
      unpaid dividends and without accumulation of dividends for any prior Series
      A
      Dividend Period (as defined below) to the extent not declared and payable in
      respect of such Series A Dividend Period. In the event that upon any voluntary
      or involuntary liquidation, dissolution

     

    
      
        
        

      

      
        -3-

        
          

        

      

      
        
        

      

    

    or
      winding up of the Company, the assets of the Company available are insufficient
      to pay the amount of the liquidating distributions on all outstanding Series
      A
      Preference Shares as referred to above and the corresponding amounts payable
      on
      all other shares, if any, ranking pari
      passu on
      a pro
      rata basis
      with the
      Series A Preference Shares with respect to the payment of dividends and the
      distribution of assets upon any liquidation, dissolution or winding up of the
      Company (including, without limitation, any other series of preference shares,
      if issued) (the “Series A Parity Shares”), then the Series A Holders, and all
      such Series A Parity Shares shall share on a pro rata basis in any such
      distribution of assets in proportion to the full liquidating distributions
      to
      which they would otherwise be respectively entitled. The Series A Preference
      Shares will not be convertible into, exchangeable for or carry rights or options
      to purchase, any Common Shares or any other class or series of securities of
      the
      Company or any other entity. For purposes of this Section 3.3(a), a
      consolidation, amalgamation, merger, arrangement or reconstruction involving
      the
      Company or the sale or transfer of all or substantially all of the shares or
      property or business of the Company will not be deemed to constitute a
      liquidation, dissolution or winding up.

     

    
      	
              (b)

            	
              Dividend
                Rights

            

    

     

    
      	 	
              (i)

            	
              During
                the Series A Fixed Rate Period (as defined below), Series A Holders
                will
                be entitled to receive, when, as and if declared by the Board of
                Directors, cash dividends at a fixed annual rate equal to 6.88% of
                the
                either US$25 or US$1,000 liquidation preference per share on March
                31 and
                September 30. During the Series A Floating Rate Period (as defined
                below),
                Series A Holders will be entitled to receive, when, as and if declared
                by
                the Board of Directors, cash dividends at a floating annual rate
                equal to
                Three-Month LIBOR for the applicable Series A Dividend Period, plus
                2.715%
                on the liquidation preference of either US$25 or US$1,000 per
                share.

            

    

     

    “Three-Month
      LIBOR” with respect to any Series A Dividend Period shall be the rate (expressed
      as a percentage per annum) for deposits in United States dollars for a
      three-month period beginning on the first day of such Series A Dividend Period
      that appears on Reuters LIBOR01 Page (as defined below) as of 11:00 a.m., London
      time, on the Determination Date (as defined below). If the Reuters LIBOR01
      Page
      as of 11:00 a.m., London time, does not include the applicable rate or is
      unavailable on the Determination Date, the calculation agent will request the
      principal London office of each of four major banks in the London interbank
      market, as selected by the calculation agent, to provide that bank’s offered
      quotation (expressed as a percentage per annum) as of approximately 11:00 a.m.,
      London time, on the Determination Date to prime banks in the London interbank
      market for deposits in a Representative Amount (as defined below) for a
      three-month period beginning on the first day of such Series A Dividend Period.
      If at least two offered quotations are so provided, LIBOR for such Series A
      Dividend Period will be the arithmetic mean (rounded upward if necessary to
      the
      nearest whole multiple of 0.00001%) of those quotations. If fewer than two
      quotations are so provided, the calculation agent will request each of three
      major banks in

     

    
      
        
        

      

      
        -4-

        
          

        

      

      
        
        

      

    

    New
      York
      City, as selected by the calculation agent, to provide that bank’s rate
      (expressed as a percentage per annum), as of approximately 11:00 a.m., New
      York
      City time, on the Determination Date for loans in a Representative Amount to
      leading European banks for a three-month period beginning on the first day
      of
      such Series A Dividend Period. If at least three rates are so provided, LIBOR
      for such Series A Dividend Period will be the arithmetic mean (rounded upward
      if
      necessary to the nearest whole multiple of 0.00001%) of those rates. If fewer
      than three rates are so provided, then LIBOR for the Series A Dividend Period
      will be LIBOR in effect with respect to the immediately preceding Series A
      Dividend Period.

     

    “Business
      Day” means a day on which commercial banks and foreign exchange markets settle
      payments and are open for general business (including dealings in foreign
      exchange and foreign currency deposits) in Bermuda, London and New York
      City.

     

    “Determination
      Date” with respect to any Series A Dividend Period will be the second London
      Banking Day preceding the first day of that Series A Dividend Period. London
      Banking Day is any day in which dealings in United States dollars are transacted
      or, with respect to any future date, are expected to be transacted in the London
      interbank market.

     

    “Representative
      Amount” means a principal amount of not less than US$1,000,000 for a single
      transaction in the relevant market at the relevant time.

     

    “Reuters
      LIBOR01 Page” means the display designated on page LIBOR01 on the Reuters Page
      (or such other page as may replace the LIBOR01 page on the Reuters Page or
      such
      other service as may be nominated by the British Bankers Association for the
      purpose of displaying London interbank offered rates for U.S. Dollar
      deposits).

     

    “Reuters
      Page” means the display on Reuters Money 3000 Service, or any successor
      service.

     

    The
      dividend rates applicable during the Series A Fixed Rate Period and the Series
      A
      Floating Rate Period are referred to collectively as the “Series A Dividend
      Rate.” The rights of the Series A Holders to receive dividends are
      non-cumulative. Accordingly, to the extent dividends are neither declared nor
      paid in respect of any Series A Dividend Period in respect of the Series A
      Preference Shares, Series A Holders will have no right to receive dividends
      in
      respect of that Series A Dividend Period in respect of the Series A Preference
      Shares and the Company will have no obligation to pay dividends in respect
      of
      that Series A Dividend Period in respect of the Series A Preference Shares,
      whether or not dividends are payable in respect of any future Series A Dividend
      Period in respect of the Series A Preference Shares. In addition, the
      liquidation preference of the Preference Shares will not be adjusted for any
      dividends that are not declared. 

     

    
      
        
        

      

      
        -5-

        
          

        

      

      
        
        

      

    

    Subject
      to the next sentence, dividends will be payable semi-annually, during the Series
      A Fixed Rate Period, and quarterly, during the Series A Floating Rate Period,
      in
      each case when, as and if declared by the Company’s Board of Directors, in
      arrears, on March 31 and September 30 (or if such date is not a Business Day,
      on
      the Business Day immediately after such date and no further sums will be payable
      in respect of such delay), during the Series A Fixed Rate Period, and on March
      31, June 30, September 30 and December 31 (or if such date is not a Business
      Day, on the Business Day immediately after such date unless such day would
      fall
      in the next calendar month, in which case the dividend will be paid on the
      immediately preceding Business Day), during the Series A Floating Rate Period,
      of each year (each such date during the Series A Fixed Rate Period or the Series
      A Floating Rate Period a “Series A Dividend Payment Date”). The first dividend
      will represent the period of time from and including the date of original
      issuance to but excluding September 30, 2007, calculated as described
      below.

     

    During
      the Series A Fixed Rate Period, the amount of the dividend that is to be payable
      to the Series A Holder of each Series A Preference Share with respect to each
      Dividend Period in respect of Series A Preference Shares will be calculated
      as
      follows: the product, rounded to the nearest cent (half a cent being rounded
      upwards), of (i) 6.88%, (ii) either US$25 or US$1,000 and (iii) a
      fraction, (A) the numerator of which will be 180 (or, in the case of a
      Series A Dividend Period that is not a full Series A Dividend Period in respect
      of Series A Preference Shares, the actual number of days elapsed in such Series
      A Dividend Period), and (B) the denominator of which will be
      360.

     

    Each
      Series A Dividend Period during the Series A Fixed Rate Period will be the
      period from and including a respective Series A Dividend Payment Date for the
      Series A Fixed Rate Period up to but excluding the immediately succeeding Series
      A Dividend Payment Date for the Series A Fixed Rate Period (provided that the
      last Series A Dividend Period for the Series A Fixed Rate Period shall end
      on
      September 29, 2017).

     

    During
      the Series A Floating Rate Period, the amount of the dividend that is to be
      payable to the Series A Holder of each Series A Preference Share with respect
      to
      each Series A Dividend Period in respect of Series A Preference Shares will
      be
      calculated as follows: the product, rounded to the nearest cent (half a cent
      being rounded upwards), of (i) three-Month LIBOR for such Dividend Period in
      respect of Series A Preference Shares plus 2.715%, (ii) either US$25 or US$1,000
      and (iii) a fraction, (A) the numerator of which will be the actual number
      of
      days in the Series A Dividend Period, and (B) the denominator of which will
      be
      360.

     

    Each
      Series A Dividend Period during the Series A Floating Rate Period will be the
      period from and including a respective Series A Dividend Payment Date for the
      Series A Floating Rate Period up to but excluding the immediately succeeding
      Series A Dividend Payment Date for the Series A Floating Rate Period
      (provided

     

    
      
        
        

      

      
        -6-

        
          

        

      

      
        
        

      

    

    that
      the
      first Series A Dividend Period for the Series A Floating Rate Period shall
      begin
      on September 30, 2017).

     

    If
      declared, dividends will be payable to Series A Holders of record as they appear
      in the Company’s register of members at the close of business on the applicable
      record date, which will be one day prior to the Series A Dividend Payment Date
      as long as all of the Series A Preference Shares remain in book-entry form.
      If
      all of the Series A Preference Shares are not in book-entry form, the record
      date with respect to the Series A Preference Shares will be 15 days prior to
      the
      Series A Dividend Payment Date (whether or not such date is a Business Day).
      Holders will not be entitled to any dividends other than as described above.
      Dividends on the Series A Preference Shares will be non-cumulative, but will
      be
      payable only if there are funds legally available for the payment of such
      dividends and such dividends are declared. No interest or sum of money in lieu
      of interest will be payable on any dividend payment.

     

    “Series
      A
      Dividend Period” shall mean the period from and including a Series A Dividend
      Payment Date (or the date of the original issuance if there has not been a
      Series A Dividend Payment Date) to but excluding the immediately succeeding
      Series A Dividend Payment Date.

     

    “Series
      A
      Fixed Rate Period” means the period from and including the Closing Date to but
      excluding September 30, 2017.

     

    “Series
      A
      Floating Rate Period” means the period from and after September 30,
      2017.

     

    
      	 	
              (ii)

            	
              As
                long as any Series A Preference Shares are outstanding, no dividends
                or
                other distributions may be declared or paid or set apart for payment
                on
                any class or series of Series A Parity Shares for any period unless
                either
                (1) full dividends have been, or contemporaneously are, declared
                and paid
                or declared and a sum sufficient for the payment thereof set apart
                for
                such payments on the Series A Preference Shares for the then-current
                Series A Dividend Period or (2) all dividends declared upon the Series
                A
                Preference Shares and any Series A Parity Shares are declared pro
                rata so
                that the amount of dividends declared per share on the Series A Preference
                Shares and any Series A Parity Shares will in all cases bear to each
                other
                the same ratio that accrued but unpaid dividends per share on the
                Series A
                Preference Shares (with respect to the then-current Series A Dividend
                Period) and such Series A Parity Shares bear to each
                other.

            

    

     

    
      	 	
              (iii)

            	
              As
                long as any Series A Preference Shares are outstanding (1) no dividends
                (other than those paid in Common Shares or other shares ranking junior
                in
                right of payment to the Series A Preference Shares as to dividends
                and the
                distribution of assets upon any liquidation, dissolution or winding
                up of
                the Company (together with the Common Shares, “Series A Fully Junior
                Shares”)), may be declared or paid or set apart for payment upon any
                Series A Junior Shares, (2) no other
                distri-

            

    

     

    
      
        
        

      

      
        -7-

        
          

        

      

      
        
        

      

    

    bution
      (other than those paid in Series A Fully Junior Shares) may be declared or
      paid
      or set apart for payment upon any Series A Junior Shares and (3) no Series
      A
      Junior Shares may be redeemed, purchased or otherwise acquired (other than
      a
      redemption, purchase or other acquisition of Common Shares made for purposes
      of
      any employee incentive, stock, benefit or any similar plan of the Company or
      any
      of its subsidiaries) for any consideration (or any moneys be paid to or made
      available for a sinking fund or the redemption of any Series A Junior Shares)
      by
      the Company (except by conversion into or exchange for Series A Fully Junior
      Shares), unless, in any such case, full dividends on the Series A Preference
      Shares and any Series A Parity Shares have been or contemporaneously are
      declared and paid, or declared and a sum sufficient for the payment thereof
      set
      apart for payment, for the then-current Series A Dividend Period.

     

    
      	
              (c)

            	
              Voting
                Rights

            

    

     

    
      	 	
              (i)

            	
              Subject
                to paragraphs (ii) and (iii) below, and unless required by law or
                court
                order, the Series A Holders shall not be entitled to receive notice
                of nor
                to attend nor to vote at any general meeting of the
                Company.

            

    

     

    
      	 	
              (ii)

            	
              The
                Series A Holders shall be entitled to one vote for each Series A
                Preference Share held at any separate general meeting of that class
                or
                series (i.e., Preference Shares or Series A Preference Shares,
                respectively), subject to the provisions of Article 43 of the Bye-laws.
                At
                every separate meeting of Series A Holders, the necessary quorum
                shall be
                any one or more persons present in person or by proxy holding more
                than
                50% of the issued shares of that class. Notwithstanding the foregoing
                and
                subject to the applicable provisions of the Memorandum of Association,
                the
                Bye-laws and the Law, Series A Holders are not entitled to vote on
                any
                sale of all or substantially all of the assets of the Company, or
                the
                issuance of any shares that rank pari
                passu
                with, or senior or junior to, the Series A Preference Shares as to
                the
                payment of dividends and the distribution of assets upon the liquidation,
                dissolution or winding up of the
                Company.

            

    

     

    
      	 	
              (iii)

            	
              If
                at any time dividends payable on the Series A Preference Shares shall
                not
                have been paid (whether or not such dividends shall have been declared)
                in
                an aggregate amount equivalent to dividends for six or more full
                quarterly
                periods, which, during the Series A Fixed Rate Period, shall mean
                three or
                more Series A Dividend Periods and, during the Series A Floating
                Rate
                Period, shall mean six or more Series A Dividend Periods (in each
                case,
                whether or not consecutive), then during such period until all such
                dividends shall have been paid in full, and only during such period
                (the
                “Series A Voting Period”), the Series A Holders voting together with any
                other series or classes of Preference Shares also in not having been
                paid
                and having such right shall be entitled by ordinary resolution at
                a
                separate meeting of such holders to elect two persons and nominate
                such
                elected persons for appointment by the Board of Directors as additional
                Directors of the Company. In no event shall there be more than two
                Directors elected by the holders of the Series A Preference Shares
                (whether voting alone as a series or class
                or

            

    

     

    
      
        
        

      

      
        -8-

        
          

        

      

      
        
        

      

    

    with
      another series or class so in arrears and having such right). The right of
      the
      holders of the Series A Preference Shares will cease (subject always to the
      same
      provision for the vesting of such rights if dividends on the Series A Preference
      Shares are not paid in future periods) upon the earlier to occur of (i) the
      first date as of which full dividends on the Series A Preference Shares have
      been paid for at least four consecutive quarterly periods, which, during the
      Series A Fixed Rate Period, shall mean two or more Series A Dividend Periods
      and, during the Series A Floating Rate Period, shall mean four or more Series
      A
      Dividend Periods, and (ii) the redemption of all Series A Preference
      Shares. 

     

    
      	 	
              (iv)

            	
              Any
                Director who shall have been elected pursuant to Section 3.4 below
                may be removed at any time during a Series A Voting Period, either
                for or
                without cause, by, and only by, ordinary resolution of the holders
                of the
                outstanding Preference Shares of the relevant class or series at
                a special
                separate general meeting of such holders called for that purpose.
                Any
                vacancy thereby created may be filled during such Series A Voting
                Period
                by ordinary resolution of the holders of Preference Shares of all
                relevant
                series at such a meeting. Any Director elected by holders of Preference
                Shares pursuant to this provision, or by any Director so elected
                as herein
                contemplated, who dies, resigns or otherwise ceases to be a Director
                during a Series A Voting Period shall, except as otherwise provided
                in the
                preceding sentence, be replaced by the remaining Director theretofore
                elected by the holders of Preference Shares nominating a replacement
                for
                appointment by the Board of Directors; provided
                that, if no remaining additional Director is then in office, additional
                Directors will be elected in accordance with the procedures described
                above. At the end of the Series A Voting Period, the holders of Preference
                Shares of all the relevant series shall be automatically divested
                of all
                voting powers vested in them by the provision, but subject always
                to
                subsequent vesting of such voting power in the holders of Preference
                Shares in the event of any similar cumulated arrearage in payment
                of
                quarterly dividends occurring thereafter. The term of all Directors
                elected and appointed pursuant to this provision shall in all events
                expire at the end of the applicable Series A Voting Period and if
                the size
                of the Board of Directors was increased for the purpose of the additional
                Directors, the number of Directors constituting the Board of Directors
                shall be reduced accordingly. The provisions of the Bye-laws relating
                to
                general meetings and voting shall apply, mutatis
                mutandis,
                to every such separate meeting, except that the necessary quorum
                shall be
                any one or more persons present in person or by proxy holding more
                than
                fifty percent (50%) of the issued Preference Shares of the relevant
                series.

            

    

     

    
      	
              (d)

            	
              Redemption

            

    

     

    The
      Company shall be entitled to redeem all or any of the Series A Preference Shares
      as follows:

     

    
      	 	
              (i)

            	
              General.
                Subject
                to Section 3.3(j) and paragraphs (ii), (iii), (iv) and (v) below,
                the
                Series A Preference Shares shall not be redeemable by the Company
                prior
                to

            

    

     

    
      
        
        

      

      
        -9-

        
          

        

      

      
        
        

      

    

    September
      30, 2017. From or after such date, the Company shall be entitled at any time
      in
      whole or from time to time in part, upon not less than thirty (30) days’ nor
      more than sixty (60) days’ prior written notice to the Series A Holders, in such
      form and given in such manner as the Directors shall from time to time determine
      and in accordance with paragraph (e) below, to redeem all or any of the Series
      A
      Preference Shares pursuant to this paragraph for cash at a redemption price
      of
      either US$25 or US$1,000 per share being redeemed (inclusive of the nominal
      value thereof) plus any declared and unpaid dividends with respect to the
      then-current Series A Dividend Period to the date of redemption, without
      interest on such declared and unpaid dividends and without accumulation of
      dividends for any prior Series A Dividend Period to the extent not declared
      and
      payable in respect of such Series A Dividend Period.

     

    
      	 	
              (ii)

            	
              Redemption
                upon the Submission of Certain Shareholder
                Proposals.
                At
                any time prior to September 30, 2017, provided
                that at such time some or all of the Series A Preference Shares are
                outstanding, if the Company shall have (i) submitted to holders of
                Common
                Shares a proposal for an amalgamation, consolidation, merger, arrangement,
                reconstruction, reincorporation, deregistration or any other similar
                transaction involving the Company that requires or (ii) submitted
                any
                proposal for any other matter that, as a result of any change in
                Bermuda
                law after the date of the final Offering Memorandum relating to the
                issuance and sale of the Series A Preference Shares (whether by enactment
                or official interpretation) requires, in each case, a vote of Series
                A
                Holders voting separately as a single class (alone or with one or
                more
                class or series of preference shares), the Company shall be entitled,
                upon
                not less than thirty (30) days’ nor more than sixty (60) days’ prior
                written notice to the Series A Holders, in such form and given in
                such
                manner as the Directors shall from time to time determine and in
                accordance with paragraph (e) below, to redeem all of the outstanding
                Series A Preference Shares pursuant to this paragraph for cash at
                a
                redemption price equal to the Make Whole Amount for the Series A
                Preference Shares described in clause (vi) below, plus any declared
                and
                unpaid dividends with respect to the then-current Series A Dividend
                Period
                to the date of redemption, without interest on such declared and
                unpaid
                dividends and without accumulation of dividends for any prior Series
                A
                Dividend Period to the extent not declared and payable in respect
                of such
                Series A Dividend Period.

            

    

     

    
      	 	
              (iii)

            	
              Redemption
                on Tax Event.
                If
                (a) there is a “change in tax law” that would require the Company or any
                successor company to pay any additional amounts with respect to any
                then
                issued and outstanding Series A Preference Shares and (b) the payment
                of
                those additional amounts cannot be avoided by the use of any reasonable
                measures available to the Company or any successor company, the Company
                shall be entitled at any time thereafter, upon not less than thirty
                (30)
                days’ nor more than sixty (60) days’ prior written notice to the Series A
                Holders, in such form and given in such manner as the Directors shall
                from
                time to time determine and in accordance with paragraph (e) below,
                to
                redeem, in whole but not in part, the Series A Preference Shares
                pursuant
                to this paragraph for cash at a
                redemption

            

    

     

    
      
        
        

      

      
        -10-

        
          

        

      

      
        
        

      

    

    price
      equal to the Make Whole Amount for the Series A Preference Shares described
      in
      clause (vi) below, plus any declared and unpaid dividends with respect to the
      then-current Series A Dividend Period to the date of redemption, without
      interest on such declared and unpaid dividends and without accumulation of
      dividends for any prior Series A Dividend Period to the extent not declared
      in
      respect of such Series A Dividend Period.

     

    For
      the
      purpose of this provision a “change in tax law” shall be (a) a change in or
      amendment to laws, regulations or rulings of any jurisdiction, political
      subdivision or taxing authority described in the next sentence, (b) a change
      in
      the official application or interpretation of those laws, regulations or
      rulings, or (c) any execution of or amendment to any treaty affecting taxation
      to which any jurisdiction, political subdivision or taxing authority described
      in the next sentence is party after the date of the final Offering Memorandum.
      The jurisdictions, political subdivisions and taxing authorities referred to
      in
      the previous sentence are (a) Bermuda or any political subdivision or
      governmental authority of or in Bermuda with the power to tax, (b) any
      jurisdiction from or through which the Company or its paying agent is making
      payments on the Series A Preference Shares or any political subdivision or
      governmental authority of or in that jurisdiction with the power to tax, or
      (c)
      any other jurisdiction in which the Company or its successor company is
      organized or generally subject to taxation or any political subdivision or
      governmental authority of or in that jurisdiction with the power to
      tax.

     

    
      	 	
              (iv)

            	
              Tax
                Event on Consolidation.
                If
                the entity formed by a consolidation, merger or amalgamation involving
                the
                Company or the entity to which the Company conveys, transfers or
                leases
                substantially all of its properties and assets would be required
                to pay
                additional amounts in respect of any tax, assessment or governmental
                charge imposed on any Series A Holder as a result of a change in
                tax law
                that occurred after the date of the consolidation, merger, amalgamation,
                conveyance, transfer or lease, and the payment of those amounts cannot
                be
                avoided by the use of any reasonable measures available to the Company
                or
                any successor company, the Company shall be entitled to at any time
                thereafter, upon not less than thirty (30) days’ nor more than sixty (60)
                days’ prior written notice to the Series A Holders, in such form and given
                in such manner as the Directors shall from time to time determine
                and in
                accordance with paragraph (e) below, to redeem, in whole but not
                in part,
                the Series A Preference Shares outstanding at such time, if any,
                pursuant
                to this paragraph for cash at a redemption price equal to the Make
                Whole
                Amount for the Series A Preference Shares described in clause (vi)
                below,
                plus any declared and unpaid dividends with respect to the then-current
                Series A Dividend Period to the date of redemption, without interest
                on
                such declared and unpaid dividends and without accumulation of dividends
                for any prior Series A Dividend Period to the extent not declared
                and
                payable in respect of such Series A Dividend
                Period.

            

    

     

    
      	 	
              (v)

            	
              Redemption
                upon the Occurrence of a Rating Agency Event.
                At
                any time prior to September 30, 2017, provided
                that at such time some or all of the
                Series

            

    

     

    
      
        
        

      

      
        -11-

        
          

        

      

      
        
        

      

    

    A
      Preference Shares are outstanding, if there shall occur a Rating Agency Event
      in
      respect of the Series A Preference Shares, the Company shall be entitled, upon
      not less than thirty (30) days’ nor more than sixty (60) days’ prior written
      notice to the Series A Holders, in such form and given in such manner as the
      Directors shall from time to time determine and in accordance with paragraph
      (e)
      below, to redeem all of the outstanding Series A Preference Shares pursuant
      to
      this paragraph for cash at a redemption price equal to the Make Whole Amount
      for
      the Series A Preference Shares described in clause (vi) below, plus any declared
      and unpaid dividends with respect to the then-current Series A Dividend Period
      to the date of redemption, without interest on such declared and unpaid
      dividends and without accumulation of dividends for any prior Series A Dividend
      Period to the extent not declared and payable in respect of such Series A
      Dividend Period.

     

    For
      purposes of the preceding paragraph, “Rating Agency Event” means a change by any
      nationally recognized statistical rating organization within the meaning of
      Rule
      15c3-1 under the U.S. Securities Exchange Act of 1934, as amended (the “Exchange
      Act”), that currently publishes a rating for the Company (a “Rating Agency”) to
      the Company’s equity credit criteria for the Series A Preference Shares, as such
      criteria are in effect on the date of the final Offering Memorandum (the
“Current Criteria”), which change results in (a) the shortening of the length of
      time for which such current equity credit is scheduled to be in effect with
      respect to the Series A Preference Shares, or (b) a lower equity credit being
      given to the Series A Preference Shares as of the date of such change than
      the
      equity credit that would have been assigned to the Series A Preference Shares
      as
      of the date of such change by such Rating Agency pursuant to its Current
      Criteria.

     

    
      	 	
              (vi)

            	
              Make
                Whole Amount.
                With
                respect to the Series A Preference Shares, the “Make Whole Amount” will be
                in US dollars and will be equal to the greater of (i) the aggregate
                liquidation preference of the Series A Preference Shares to be redeemed
                and (ii) the sum of the present values of the aggregate liquidation
                preference of the Series A Preference Shares to be redeemed and the
                remaining scheduled payments of dividends on the Series A Preference
                Shares to be redeemed up to but excluding September 30, 2017 discounted
                to
                the redemption date on a semi-annual basis (assuming a 360-day year
                consisting of twelve 30-day months) at a rate equal to the Treasury
                Rate
                (as defined below) plus 50 basis
                points.

            

    

     

    For
      the
      purposes of the preceding paragraph:

     

    · 
“Comparable
      Treasury Issue” means the United States Treasury security selected by the
      Reference Treasury Dealer as having a maturity comparable to the period from
      and
      including the redemption date to but excluding September 30, 2017 that would
      be
      utilized, at the time of selection and in accordance with customary financial
      practice, in pricing new issues of corporate debt securities of comparable
      maturity to such period of time. If no United States Treasury security has
      a
      maturity which is within a period from three

     

    
      
        
        

      

      
        -12-

        
          

        

      

      
        
        

      

    

    months
      before to three months after the remaining life, the two most closely
      corresponding United States Treasury securities, as selected by the Reference
      Treasury Dealer, shall be used as the Comparable Treasury Issue, and the
      adjusted Treasury Rate shall be interpolated or extrapolated on a straight-line
      basis, rounding to the nearest month, using such securities.

     

    ·   
       “Comparable
      Treasury Price” means, with respect to any redemption date, (i) the average
      of the bid and asked prices for the Comparable Treasury Issue (expressed in
      each
      case as a percentage of its principal amount) on the third Business Day
      preceding such distribution date, as set forth in the H.15 Daily Update
      published on such Business Day, or (ii) if such release (or any successor
      release) is not published or does not contain prices on such Business Day,
      the
      Reference Treasury Dealer Quotation actually obtained by the calculation agent
      for such redemption date.

     

    ·    
      “H.15
      (519)” means the weekly statistical release entitled “H.15 (519) Selected
      Interest Rates,” or any successor publication, published by the Board of
      Governors of the Federal Reserve System.

     

    ·    
      “H.15
      Daily Update” means the daily update of H.15 (519) available through the world
      wide website of the Board of Governors of the Federal Reserve System or any
      successor site or publication.

     

    ·    
      “Reference
      Treasury Dealer” means a nationally recognized investment bank that is a primary
      U.S. government securities dealer in New York City selected by the
      Company.

     

    ·    
      “Reference
      Treasury Dealer Quotation” means, with respect to the Reference Treasury Dealer
      and redemption date, the average, as determined by the calculation agent, of
      the
      bid and asked prices for the Comparable Treasury Issue (expressed in each case
      as a percentage of its principal amount) quoted in writing to the calculation
      agent by the Reference Treasury Dealer at 5:00 p.m., New York City time, on
      the third Business Day preceding such redemption date.

     

    ·    
      “Treasury
      Rate” means, with respect to any redemption date, the rate per annum equal to
      the semi-annual equivalent yield to maturity of the Comparable Treasury Issue,
      assuming a price for the Comparable Treasury Issue (expressed as a percentage
      of
      its principal amount) equal to the Comparable Treasury Price for such redemption
      date.

     

    
      	
              (e)

            	
              Notices
                of Redemption

            

    

     

    Notice
      of
      any redemption at the option of the Company described herein will be mailed
      at
      least thirty (30) days but not more than sixty (60) days before the redemption
      date to each Series A Holder of record of Series A Preference Shares to be
      redeemed at the address

     

    
      
        
        

      

      
        -13-

        
          

        

      

      
        
        

      

    

    shown
      in
      the register of members of the Company; provided
      that, if
      the Series A Preference Shares are then held in book-entry form through The
      Depository Trust Company (“DTC”), the Company may give notice to the Series A
      Holders in any manner permitted by DTC. Each notice will state as appropriate:
      (1) the redemption date; (2) the number of Series A Preference Shares to be
      redeemed; (3) the redemption price; (4) the place or places where certificates
      for Series A Preference Shares are to be surrendered for payment of the
      redemption price if any such certificates are outstanding; and (5) where
      applicable, that dividends on the Series A Preference Shares to be redeemed
      will
      cease to accrue on such redemption date. If fewer than all Series A Preference
      Shares are to be redeemed, the notice provided to each such Series A Holder
      will
      also specify the number of Series A Preference Shares to be redeemed from such
      Series A Holder. The notice shall contain (i) the name and address of the
      relevant bank or trust company to be used for purposes of redemption (if any)
      and (ii) a statement as to the deposit or intent to deposit the redemption
      funds
      in such trust account.

     

    
      	
              (f)

            	
              Directors
                Determine Shares Redeemed

            

    

     

    If
      fewer
      than all of the Series A Preference Shares are to be redeemed at the option
      of
      the Company, the number of shares to be redeemed will be determined by the
      Directors in their absolute discretion and such Series A Preference Shares
      may
      be redeemed pro
      rata
      from the
      Series A Holders of record in proportion to the number of Series A Preference
      Shares held by such Series A Holders (with adjustments to avoid redemption
      of
      fractional shares), or by lot.

     

    
      	
              (g)

            	
              Dividends
                Cease

            

    

     

    If
      notice
      of redemption of any Series A Preference Shares has been given and if the funds
      necessary for such redemption have been set apart by the Company in trust for
      the benefit of the Series A Holders of such Series A Preference Shares so called
      for redemption, then from and after the redemption date, dividends will cease
      to
      accrue on the Series A Preference Shares being redeemed, the Series A Preference
      Shares so redeemed will no longer be deemed to be outstanding and all rights
      of
      the Series A Holders of such Series A Preference Shares will terminate, except
      the right to receive the redemption price.

     

    
      	
              (h)

            	
              Dividends
                Payable to Record Date

            

    

     

    If
      a
      redemption date falls after a dividend record date with respect to which a
      dividend has been declared and prior to the corresponding Series A Dividend
      Payment Date, the Series A Holders at the close of business on the dividend
      record date will be entitled to receive the dividend payable with respect to
      such Series A Preference Shares on the corresponding Series A Dividend Payment
      Date notwithstanding the redemption thereof between the dividend record date
      and
      the corresponding Series A Dividend Payment Date or a default in the payment
      of
      the dividend due on such Series A Dividend Payment Date.

     

    
      
        
        

      

      
        -14-

        
          

        

      

      
        
        

      

    

     

    
      	
              (i)

            	
              Dividends
                Paid

            

    

     

    Unless
      full dividends on the Series A Preference Shares and all Series A Parity Shares
      for the then-current Series A Dividend Period shall have been declared and
      paid,
      or declared and a sum sufficient for the payment thereof set apart for payment
      for all such dividends on or prior to the date of a redemption, purchase or
      other acquisition, no Series A Preference Shares or Series A Parity Shares
      may
      be redeemed, purchased or otherwise acquired by the Company unless all
      outstanding Series A Preference Shares and any Series A Parity Shares are
      redeemed; provided
      that the
      Company may acquire fewer than all of the outstanding Series A Preference Shares
      or any Series A Parity Shares pursuant to a purchase or exchange offer made
      on
      the same terms to Series A Holders of all outstanding Series A Preference Shares
      and Series A Parity Shares as determined in good faith by the Board of Directors
      of the Company.

     

    
      	
              (j)

            	
              Right
                to Purchase Series A Preference
                Shares

            

    

     

    Subject
      to (1) the terms of the Replacement Capital Covenant, (2) certain limitations
      contained in the Memorandum of Association, (3) certain limitations contained
      in
      the Company’s Bye-laws, (4) the special rights granted to any of the Company’s
      issued and outstanding shares and (5) applicable law, the Company may, at any
      time and from time to time, purchase outstanding Series A Preference Shares.
      Any
      such purchase made by the Company may be made in the open market, by tender
      to
      all Series A Holders, by private agreement or otherwise as the Directors see
      fit. Any Series A Preference Shares purchased by the Company for its own account
      (other than in the ordinary course of business of dealing in securities) will
      be
      cancelled by the Company and will no longer be issued and
      outstanding.

     

    
      	
              (k)

            	
              Redemption
                Proceeds

            

    

     

    Under
      Bermuda law, the Company may not redeem or purchase the Series A Preference
      Shares except out of its profits, from the proceeds of a new issue of shares
      made for the purpose of the redemption or purchase, out of capital or from
      the
      share premium account. The premium, if any, payable on redemption or purchase
      must be provided for out of funds that would otherwise be available for dividend
      or distribution or out of the Company’s share premium account before or at the
      time the Series A Preference Shares are redeemed or purchased.

     

    
      	
              (l)

            	
              Cancellation
                of Share Certificates

            

    

     

    Payment
      of the redemption amount shall only be effected upon surrender to the Company
      for cancellation of any share certificate in respect of the Series A Preference
      Shares (to the extent such certificates are outstanding) to be redeemed and
      shall be made as promptly as practicable. If any certificate so surrendered
      includes Series A Preference Shares not being redeemed, a new certificate for
      the remaining Series A Preference Shares shall be issued to the Series A Holder
      in accordance with the Memorandum of Association and Bye-laws without charge
      to
      such Series A Holder.

     

    
      
        
        

      

      
        -15-

        
          

        

      

      
        
        

      

    

     

    
      	
              (n)

            	
              Redemption
                Process

            

    

     

    The
      Directors may make such further regulations concerning the administerial process
      of redemption as they shall from time to time deem necessary so long as the
      rights of the Series A Holders are not varied.

     

    
      	
              (n)

            	
              Rights
                Not Varied

            

    

     

    The
      rights conferred upon the Series A Holders of the Series A Preference Shares
      shall not be deemed to be varied by the creation or issue of any Series A Parity
      Shares, Series A Junior Shares or Series A Fully Junior Shares.

     

    
      	
              (o)

            	
              Payments
                of Additional Amounts

            

    

     

    All
      payments on the Series A Preference Shares shall be made free and clear of,
      and
      without deduction or withholding for or on account of, any present or future
      taxes, assessments or other governmental charges imposed by any jurisdiction,
      political subdivision or taxing authority described in paragraph 3.3(d)(iii)
      of
      these Resolutions, unless the deduction or withholding of such
      taxes,
      assessments or other governmental charges is required by law, regulations or
      rulings or the application or official interpretation of such law, regulations
      or rulings. In that event, the Company shall pay, or cause to be paid,
      additional amounts to the registered Series A Holders as additional dividends
      to
      make up for any deduction or withholding for any present or future taxes,
      assessments or other governmental charges imposed by any jurisdiction, political
      subdivision or taxing authority described in paragraph 3.3(d)(iii) of these
      Resolutions in respect of any amounts that the Company or a successor company
      must pay with respect to the Series A Preference Shares, so that the net amounts
      paid to the Series A Holders, after that deduction or withholding, shall equal
      the respective amounts that would have been receivable by such Series A Holders
      had no such withholding or deduction been required. For the avoidance of doubt,
      all references to payments on the Series A Preference Shares, including without
      limitation, payments of liquidation amounts, redemptions prices and dividends,
      shall be deemed to include the payment of any such additional dividends in
      respect of additional amounts. However, the Company shall not be obligated
      to
      pay additional amounts to any Series A Holder that:

     

    
      	 	
              (i)

            	
              resides
                in or is a citizen of the jurisdiction, political subdivision or
                taxing
                authority imposing the taxes, assessments or other governmental charges
                that would otherwise trigger the Company’s obligation to pay additional
                amounts; or

            

    

     

    
      	 	
              (ii)

            	
              is
                a fiduciary, partnership, limited liability company or other pass-through
                entity if, and to the extent that, the payment of additional amounts
                would
                be required by a jurisdiction, political subdivision or taxing authority
                described in paragraph 3.3(d)(iii) of these Resolutions to be included
                in
                the income for tax purposes of a beneficiary or settlor with respect
                to
                that fiduciary or a member of that partnership, limited liability
                company
                or other pass-through entity who would not
                have

            

    

     

    
      
        
        

      

      
        -16-

        
          

        

      

      
        
        

      

    

    been
      entitled to any additional amounts had that beneficiary, settlor or member
      held
      those Series A Preference Shares directly.

     

    
      	
              (p)

            	
              No
                Payment of Additional
                Amounts

            

    

     

    In
      addition, the Company shall not be obligated to pay any additional amounts
      to a
      Series A Holder on account of:

     

    
      	 	
              (i)

            	
              any
                tax, assessment or other governmental charge that would not have
                been
                imposed but for the existence of any present or former connection
                between
                the Series A Holder and the taxing jurisdiction or political subdivision,
                or any Series A Preference Share presented for payment more than
                thirty
                (30) days after the relevant date, which means, in respect of any
                payment,
                the date on which such payment first becomes due and payable, but
                if the
                full amount of the moneys payable has not been received by the depositary
                on or prior to such due date, it means the first date on which the
                full
                amount of such moneys having been so received and being available
                for
                payments to Series A Holders, and notice to that effect shall have
                been
                duly given to the Series A Holders;

            

    

     

    
      	 	
              (ii)

            	
              any
                estate, inheritance, gift, sales, transfer, personal property or
                similar
                tax, assessment or other governmental
                charge;

            

    

     

    
      	 	
              (iii)

            	
              any
                tax, assessment or other governmental charge that is payable other than by
                withholding or deduction from payment of the liquidation preference
                of or
                any dividends on the Series A Preference
                Shares;

            

    

     

    
      	 	
              (iv)

            	
              any
                tax, assessment or other governmental charge that is imposed or withheld
                by reason of the failure by the Series A Holder or the beneficial
                owner of
                the Series A Preference Shares to promptly comply with a request
                by the
                Company to (a) provide information, documents, certifications or
                other
                evidence concerning the nationality, residence or identity of the
                Series A
                Holder or beneficial owner of such Series A Preference Shares or
                (b) make
                and deliver any declaration or other similar claim, other than a
                claim for
                refund of a tax, assessment or other governmental charge withheld
                by the
                Company, or satisfy any information or reporting requirements, which,
                in
                the case of clause (a) or (b) of this subparagraph, is required or
                imposed
                by a statute, treaty, regulation or administrative practice of the
                taxing
                jurisdiction as a precondition to exemption from all or part of that
                tax,
                assessment or other governmental charge; or

            

    

     

    
      	 	
              (v)

            	
              any
                combination of the items identified by the subparagraphs
                above.

            

    

     

    
      	
              (q)

            	
              No
                Preemptive Rights

            

    

     

    The
      Series A Preference Shares shall not be entitled to the benefits of any sinking
      fund. No Series A Holder, solely by reason of being a Series A Holder, has
      or
      will have any preemptive right to subscribe for any additional issue of the
      Company’s shares of any

     

    
      
        
        

      

      
        -17-

        
          

        

      

      
        
        

      

    

    class
      or
      series or to any security convertible into or carrying rights or options to
      purchase any such shares.

     

    
      	
              (r)

            	
              Ranking

            

    

     

    Any
      class
      or series of shares of the Company shall be deemed to rank (1) senior to the
      Series A Preference Shares, as to the payment of dividends and as to any
      voluntary or involuntary return of assets on liquidation, dissolution or winding
      up of the Company, if holders of such class or series shall be entitled to
      the
      receipt of dividends or of amounts distributable upon any voluntary or
      involuntary return of assets on liquidation, dissolution or winding up, as
      the
      case may be, of the Company in preference or priority to the Series A Holders
      and the holders of the Series A Parity Shares, (2) pari
      passu
      with the
      Series A Preference Shares as to the payment of dividends and as to distribution
      of assets upon any voluntary or involuntary return of assets on liquidation,
      dissolution or winding up of the Company, whether or not the dividend rates,
      dividend payment dates or redemption or liquidation prices per share thereof
      shall be different from those of the Series A Preference Shares, if holders
      of
      such class or series, the Series A Preference Shares shall be entitled to the
      receipt of dividends and of amounts distributable upon any voluntary or
      involuntary return of assets on liquidation, dissolution or winding up of the
      Company in proportion to their respective amounts of accrued but unpaid
      dividends per share or liquidation preferences, without preference or priority
      of one over the other or (3) junior to the Series A Preference Shares, as to
      the
      payment of dividends or as to distribution of assets upon any voluntary or
      involuntary return of assets on liquidation, dissolution or winding up of the
      Company, if such class or series is common shares or other shares ranking junior
      in right of payment to the Series A Preference Shares as to dividends or as
      to
      the distribution of assets upon any voluntary or involuntary return of assets
      on
      liquidation, dissolution or winding up on the basis set out above of the
      Company.

     

    
      	
              3.4

            	
              Election
                of Directors

            

    

    
       

      
        	
                (a)

              	
                RESOLVED
                  that, in the event that the Series A Holders may, voting together
                  with any
                  other Series A Parity Shares as necessary, select two persons and
                  nominate
                  such elected persons for appointment by the Board of Directors
                  as
                  additional Directors of the Company pursuant to paragraph 3.3(c)(iii)
                  of
                  these Resolutions during a Series A Voting Period, the Board of
                  Directors
                  hereby, pursuant to Article 8 of the Bye-laws, increase the number
                  of
                  persons consisting of the Board of Directors by two persons (subject
                  to
                  the limit in the number of Directors stated in Article 8) and hereby
                  appoint, pursuant to Article 11 of the Bye-laws, such persons elected
                  and
                  nominated by the holders of Preference Shares as additional Directors
                  of
                  the Company. Such additional Directors shall be apportioned among
                  the
                  classes of Directors in accordance with Article 8(3) of the Bye-laws.
                  Such
                  appointment is conditional upon and subject to the
                  following:

              

      

         

    

    
      
        	 	
                (i)

              	
                The
                  term of office of each such Director shall in all events automatically
                  expire at the end of the applicable voting period;
                  and

              

      

       

    

    
      
        
        

      

      
        -18-

        
          

        

      

      
        
        

      

    

       

    
      
        	 	
                (ii)

              	
                Prior
                  to the appointment of each such elected person as a Director becoming
                  effective, each such person shall provide to the Company notice
                  in writing
                  that he resigns from the office of Director, in the form attached
                  to these
                  Resolutions, which form is hereby approved, such notice to only
                  be
                  effective upon the earliest of: (i) the expiration of the applicable
                  voting period during which such Director was appointed or (ii)
                  the passing
                  of an ordinary resolution by the holders of the relevant series
                  of
                  outstanding preference shares for the removal of such Director
                  (in
                  accordance with paragraph 3.3(c)(iv) of these
                  Resolutions).

              

      

      
        
           

          
            	
                    (b)

                  	RESOLVED that, in the event that it is necessary
                    for any
                    Director elected and nominated by the Series A Holders to be
                    removed from
                    office in accordance with the provisions of paragraph 3.3(c)(iv) of
                    these Resolutions, the Board of Directors shall put a special
                    resolution
                    to the Company at the immediately following Annual General Meeting
                    of the
                    Company for the removal of such Director or Directors pursuant
                    to
                    Article 11 of the Bye-laws.

          

          
             

            
              	
                      (c)

                    	RESOLVED that, in the event that to give
                      effect to the
                      rights granted to the Series A Holders by the provisions of
                      paragraph 3.3(c)(iii) of these Resolutions it is necessary to
                      increase the limit in the number of Directors specified in
                      Article 8 of
                      the Bye-laws, the Directors shall put an ordinary resolution
                      to the
                      Company at the next Annual General Meeting of the Company to
                      increase the
                      limit
                      in the number of Directors.

            

               

          

        

      

    

    
      	
              3.5

            	
              Transfer
                Restrictions on the Series A Preference
                Shares

            

    

     

    
      	
              (a)

            	
              Definitions.
                The following terms shall have the meanings set forth below for purposes
                of this Section 3.5.

            

    

     

    “144A
      Global Preference Share”
means
      a
      Global Preference Share bearing the Global Preference Share Legend and the
      Private Placement Legend and deposited with or on behalf of, and registered
      in
      the name of, the Depositary or its nominee.

     

    “Applicable
      Procedures”
means,
      with respect to any transfer or exchange of or for beneficial interests in
      any
      Global Preference Share, the rules and procedures of the Depositary, Euroclear
      and/or Clearstream that apply to such transfer or exchange.

     

    “Broker-Dealer”
means
      any broker or dealer registered under the Exchange Act.

     

    “Custodian”
means
      the Transfer Agent, as custodian with respect to the Preference Shares in global
      form, or any successor entity thereto.

     

    “Definitive
      Preference Share”
means
      a
      certificated Preference Share registered in the name of the Holder
      thereof.

     

    “Depositary”
means,
      with respect to the Preference Shares issuable or issued in whole or in part
      in
      global form, the Person specified in the section captioned “Depositary;
      Registrar and Paying Agent” hereof as the Depositary with respect to the
      Preference Shares,

     

    
      
        
        

      

      
        -19-

        
          

        

      

      
        
        

      

    

    and
      any
      and all successors thereto appointed as Depositary hereunder and having become
      such pursuant to the applicable provision of these Resolutions.

     

    “Global
      Preference Share Legend”
means
      the legend set forth in under the section captioned, “Legend” hereof, which is
      required to be placed on all Global Preference Shares issued under these
      Resolutions.

     

    “Global
      Preference Shares”
means,
      individually and collectively, each of the Restricted Global Preference Shares
      and the Unrestricted Global Preference Shares.

     

    “Holder”
means
      the person in whose name a Preference Share is registered on the Registrar's
      books.

     

    “Indirect
      Participant”
means
      a
      Person who holds a beneficial interest in a Global Preference Share through
      a
      Participant.

     

    “Letter
      of Transmittal”
means
      the letter of transmittal to be prepared by the Company and sent to all Holders
      of the Preference Shares for use by such Holders in connection with the Exchange
      Offer.

     

    “Opinion
      of Counsel”
means
      a
      written opinion from legal counsel who is acceptable to the Transfer Agent.
      The
      counsel may be an employee of or counsel to the Company or the Transfer
      Agent.

     

    “Participant”
means,
      with respect to the Depositary, Euroclear or Clearstream, a Person who has
      an
      account with the Depositary, Euroclear or Clearstream, respectively (and, with
      respect to DTC, shall include Euroclear and Clearstream).

     

    “Private
      Placement Legend”
means
      the legend set forth under the caption “Transfer and Exchange” hereof to be
      placed on all Preference Shares issued under these Resolutions, except where
      otherwise permitted by the provisions of these Resolutions.

     

    “Regulation
      S Global Preference Share”
means
      a
      Global Preference Share bearing the Global Preference Share Legend and the
      Private Placement Legend and deposited with or on behalf of and registered
      in
      the name of the Depositary or it nominee.

     

    “Restricted
      Definitive Preference Share”
means
      a
      Definitive Preference Share bearing the Private Placement Legend.

     

    “Restricted
      Global Preference Shares”
means
      a
      Global Preference Share bearing the Private Place Legend.

     

    “Transfer
      Agent”
means
      The Bank of New York, as transfer agent, until a successor replaces it and
      thereafter means the successor serving hereunder.

     

    “Unrestricted
      Definitive Preference Share”
means
      one or more Definitive Preference Shares that do not bear and are not required
      to bear the Private Placement Legend.

     

    
      
        
        

      

      
        -20-

        
          

        

      

      
        
        

      

    

    “Unrestricted
      Global Preference Share”
means
      a
      permanent Global Preference Share that bears the Global Preference Share Legend,
      and that is deposited with or on behalf of and registered in the name of the
      Depositary, representing Preference Shares that do not bear the Private
      Placement Legend.

     

    
      	
              (b)

            	
              Depositary;
                Registrar and Paying Agent.

            

    

     

    The
      Company initially appoints The Depository Trust Company (“DTC”)
      to act
      as Depositary with respect to the Global Preference Shares.

     

    The
      Company initially appoints the Transfer Agent to act as the Paying Agent and
      Registrar for the Preference Shares and to act as Custodian with respect to
      the
      Global Preference Shares.

     

    
      	
              (c)

            	
              Transfer
                and Exchange.

            

    

     

    
      	 	
              (i)

            	
              Transfer
                and Exchange of Global Preference Shares.
                Except
                as otherwise set forth in this Section, a Global Preference Share
                may be
                transferred, in whole and not in part, only to another nominee of
                the
                Depositary or to a successor Depositary or a nominee of such successor
                Depositary. A beneficial interest in a Global Preference Share may
                not be
                exchanged for a Definitive Preference Share unless (i) the Depositary
                (x)
                notifies the Company that it is unwilling or unable to continue as
                Depositary for such Global Preference Share or (y) has ceased to
                be a
                clearing agency registered under the Exchange Act and, in either
                case, a
                successor Depositary is not appointed by the Company within 120 days
                or
                (ii) there shall have occurred and be continuing an Event of Default
                with
                respect to the Preference Shares. Upon the occurrence of any of the
                preceding events in (i) or (ii) above, Definitive Preference Shares
                delivered in exchange for any Global Preference Share or beneficial
                interests therein will be registered in the names, and issued in
                any
                approved denominations, requested by or on behalf of the Depositary
                (in
                accordance with its customary procedures). Global Preference Shares
                also
                may be exchanged or replaced, in whole or in part, as provided herein.
                Every Preference Share authenticated and delivered in exchange for,
                or in
                lieu of, a Global Preference Share or any portion thereof, shall
                be
                authenticated and delivered in the form of, and shall be, a Global
                Preference Share, except for Definitive Preference Shares issued
                subsequent to any of the preceding events in (i) or (ii) above. A
                Global
                Preference Share may not be exchanged for another Preference Share
                other
                than as provided in this Section; provided,
                however,
                beneficial interests in a Global Preference Share may be transferred
                and
                exchanged as provided in these
                Resolutions.

            

    

     

    
      	 	
              (ii)

            	
              Transfer
                and Exchange of Beneficial Interests in the Global Preference
                Shares.
                The transfer and exchange of beneficial interests in the Global Preference
                Shares shall be effected through the Depositary, in accordance with
                the
                provisions of these Resolutions. Beneficial interests in the Restricted
                Global Preference Shares shall be subject to restrictions on transfer
                comparable to those set forth herein
                to

            

    

     

    
      
        
        

      

      
        -21-

        
          

        

      

      
        
        

      

    

    the
      extent required by the Securities Act. Transfers of beneficial interests in
      the
      Global Preference Shares also shall require compliance with either subparagraph
      (A) or (B) below, as applicable, as well as one or more of the other following
      subparagraphs, as applicable:

     

    
      	 	
              (A)

            	
              Transfer
                of Beneficial Interests in the Same Global Preference
                Share.
                Beneficial interests in any Restricted Global Preference Share may
                be
                transferred to Persons who take delivery thereof in the form of a
                beneficial interest in the same Restricted Global Preference Share
                in
                accordance with the transfer restrictions set forth in the Private
                Placement Legend. Beneficial interests in any Unrestricted Global
                Preference Share may be transferred to Persons who take delivery
                thereof
                in the form of a beneficial interest in an Unrestricted Global Preference
                Share. No written orders or instructions shall be required to be
                delivered
                to the Registrar to effect the transfers set forth in this
                Section.

            

    

     

    
      	 	
              (B)

            	
              All
                Other Transfers and Exchanges of Beneficial Interests in Global Preference
                Shares.
                In connection with all transfers and exchanges of beneficial interests
                under the caption “Transfer and Exchange” hereof, the transferor of such
                beneficial interest must deliver to the Company either (A) (1) a
                written
                order from a Participant or an Indirect Participant given to the
                Depositary in accordance
                with the Applicable Procedures directing the Depositary to credit
                or cause
                to be credited a beneficial interest in another Global Preference
                Share in
                an amount equal to the beneficial interest to be transferred or exchanged
                and (2) instructions given in accordance with the Applicable Procedures
                containing information regarding the Participant account to be credited
                with such increase or (B) (1) a written order from a Participant or
                an Indirect Participant given to the Depositary in accordance with
                the
                Applicable Procedures directing the Depositary to cause to be issued
                a
                Definitive Preference Share in an amount equal to the beneficial
                interest
                to be transferred or exchanged and (2) instructions given by the
                Depositary to the Registrar containing information regarding the
                Person in
                whose name such Definitive Preference Share shall be registered to
                effect
                the transfer or exchange referred to in (1) above. Upon consummation
                of an
                Exchange Offer by the Company in accordance with the Registration
                Rights
                Agreement, the requirements of this Section shall be deemed to have
                been
                satisfied upon receipt by the Registrar of the instructions contained
                in
                the Letter of Transmittal delivered by the Holder of such beneficial
                interests in the Restricted Global Preference Shares. Upon satisfaction
                of
                all of the requirements for transfer or exchange of beneficial interests
                in Global Preference Shares contained in these Resolutions and the
                Preference Shares or otherwise applicable under the Securities Act,
                the
                Transfer Agent shall adjust the aggregate number of the relevant
                Global
                Preference Share(s).

            

    

     

    
      
        
        

      

      
        -22-

        
          

        

      

      
        
        

      

    

    
      	 	
              (C)

            	
              Transfer
                of Beneficial Interests to Another Restricted Global Preference
                Share.
                A
                beneficial interest in any Restricted Global Preference Share may
                be
                transferred to a Person who takes delivery thereof in the form of
                a
                beneficial interest in another Restricted Global Preference Share
                if the
                transfer complies with the requirements hereof and receives the
                following:

            

    

     

    
      	 	
              (1)

            	
              if
                the transferee will take delivery in the form of a beneficial interest
                in
                the 144A Global Preference Share, then the transferor must deliver
                a
                certificate in the form of Exhibit
                A
                hereto, including the certifications in item (1) thereof;,
                or

            

    

     

    
      	 	
              (2)

            	
              if
                the transferee will take delivery in the form of a beneficial interest
                in
                the Regulation S Global Preference Share, then the transferor must
                deliver
                a certificate in the form of Exhibit
                A
                hereto, including the certifications in item (2)
                thereof.

            

    

     

    
      	 	
              (D)

            	
              Transfer
                and Exchange of Beneficial Interests in a Restricted Global Preference
                Share for Beneficial Interests in an Unrestricted Global Preference
                Share.
                A
                beneficial interest in any Restricted Global Preference Share may
                be
                exchanged by any holder thereof for a beneficial interest in an
                Unrestricted Global Preference Share or transferred to a Person who
                takes
                delivery thereof in the form of a beneficial interest in an Unrestricted
                Global Preference Share if the exchange or transfer complies with
                the
                requirements hereof and:

            

    

     

    
      	 	
              (1)

            	
              such
                exchange or transfer is effected pursuant to the Exchange Offer in
                accordance with the Registration Rights Agreement and the holder
                of the
                beneficial interest to be transferred, in the case of an exchange,
                or the
                transferee, in the case of a transfer, certifies in the applicable
                Letter
                of Transmittal that it is not (1) a Broker-Dealer, (2) a Person
                participating in the distribution of the Exchange Preference Shares
                or (3)
                a Person who is an affiliate (as defined in Rule 144) of the
                Company;

            

    

     

    
      	 	
              (2)

            	
              such
                transfer is effected pursuant to the Shelf Registration Statement
                in
                accordance with the Registration Rights
                Agreement;

            

    

     

    
      	 	
              (3)

            	
              such
                transfer is effected by a Broker-Dealer pursuant to the Exchange
                Offer
                Registration Statement in accordance with the Registration Rights
                Agreement; or

            

    

     

    
      	 	
              (4)

            	
              the
                Company receives the following:

            

    

    

      
        	 	
                (I)

              	
                if
                  the holder of such beneficial interest in a Restricted Global Preference
                  Share proposes to exchange such beneficial interest for a beneficial
                  interest in an Unrestricted Global Preference Share, a certificate
                  from
                  such Holder

              

      

      

        
          
            
            

          

          
            -23-

            
              

            

          

          
            
            

          

        

    

    substantially
      in the form of Exhibit
      B
      hereto,
      including the certifications in item (1)(a) thereof; or

    

      
        	 	
                (II)

              	
                if
                  the holder of such beneficial interest in a Restricted Global Preference
                  Share proposes to transfer such beneficial interest to a Person
                  who shall
                  take delivery thereof in the form of a beneficial interest in an
                  Unrestricted Global Preference Share, a certificate from such holder
                  in
                  the form of Exhibit
                  A
                  hereto, including the certifications in item (4)
                  thereof;

              

      

       

    

    and,
      in
      each such case set forth in this subparagraph (4), if the Registrar so requests
      or if the Applicable Procedures so require, an Opinion of Counsel in form
      reasonably acceptable to the Registrar to the effect that such exchange or
      transfer is in compliance with the Securities Act and that the restrictions
      on
      transfer contained herein and in the Private Placement Legend are no longer
      required in order to maintain compliance with the Securities Act.

     

    If
      any
      such transfer is effected pursuant to subparagraph (2) or (4) above at a time
      when an Unrestricted Global Preference Share has not yet been issued, the
      Company shall issue and, upon receipt of an Authentication Order in accordance
      with the provisions hereof, the Transfer Agent shall authenticate one or more
      Unrestricted Global Preference Shares in an aggregate number of Preference
      Shares equal to the aggregate number of beneficial interests transferred
      pursuant to subparagraph (2) or (4) above.

     

    Beneficial
      interests in an Unrestricted Global Preference Share cannot be exchanged for,
      or
      transferred to Persons who take delivery thereof in the form of, a beneficial
      interest in a Restricted Global Preference Share.

     

    
      	 	
              (iii)

            	
              Transfer
                or Exchange of Beneficial Interests for Definitive Preference
                Shares.

            

    

     

    
      	 	
              (A)

            	
              Beneficial
                Interests in Restricted Global Preference Shares to Restricted Definitive
                Preference Shares.
                If any holder of a beneficial interest in a Restricted Global Preference
                Share proposes to exchange such beneficial interest for a Restricted
                Definitive Preference Share or to transfer such beneficial interest
                to a
                Person who takes delivery thereof in the form of a Restricted Definitive
                Preference Share, then, upon the occurrence of any of the events
                hereof
                and receipt by the Company of the following
                documentation:

            

    

     

    
      	 	
              (1)

            	
              if
                the holder of such beneficial interest in a Restricted Global Preference
                Share proposes to exchange such beneficial interest for a Restricted
                Definitive Preference Share, a certificate from
                such

            

    

     

    
      
        
        

      

      
        -24-

        
          

        

      

      
        
        

      

    

    holder
      substantially in the form of Exhibit
      B
      hereto,
      including the certifications in item (2)(a) thereof;

     

    
      	 	
              (2)

            	
              if
                such beneficial interest is being transferred to a QIB in accordance
                with
                Rule 144A, a certificate substantially in the form of Exhibit
                A
                hereto, including the certifications in item (1)
                thereof;

            

    

     

    
      	 	
              (3)

            	
              if
                such beneficial interest is being transferred to a Non-U.S. Person
                in an
                offshore transaction in accordance with Rule 903 or Rule 904, a
                certificate substantially in the form of Exhibit
                A
                hereto, including the certifications in item (2)
                thereof;

            

    

     

    
      	 	
              (4)

            	
              if
                such beneficial interest is being transferred pursuant to an exemption
                from the registration requirements of the Securities Act in accordance
                with Rule 144, a certificate substantially in the form of Exhibit
                A
                hereto, including the certifications in item (3)(a)
                thereof;

            

    

     

    
      	 	
              (5)

            	
              if
                such beneficial interest is being transferred to the Company or any
                of its
                Subsidiaries, a certificate substantially in the form of Exhibit
                A
                hereto, including the certifications in item (3)(b) thereof;
                or

            

    

     

    
      	 	
              (6)

            	
              if
                such beneficial interest is being transferred pursuant to an effective
                registration statement under the Securities Act, a certificate
                substantially in the form of Exhibit
                A
                hereto, including the certifications in item (3)(c)
                thereof,

            

    

     

    the
      Transfer Agent shall cause the aggregate number of the applicable Global
      Preference Shares to be reduced accordingly, and the Company shall execute
      and
      the Transfer Agent shall authenticate and mail to the Person designated in
      the
      instructions a Definitive Preference Share in the applicable number of
      Preference Shares. Any Definitive Preference Share issued in exchange for a
      beneficial interest in a Restricted Global Preference Share pursuant to this
      Section shall be registered in such name or names and in such authorized
      denomination or denominations as the holder of such beneficial interest shall
      instruct the Registrar through instructions from the Depositary and the
      Participant or Indirect Participant. The Transfer Agent shall mail such
      Definitive Preference Shares to the Persons in whose names such Preference
      Shares are so registered. Any Definitive Preference Share issued in exchange
      for
      a beneficial interest in a Restricted Global Preference Share pursuant to this
      Section shall bear the Private Placement Legend and shall be subject to all
      restrictions on transfer contained therein.

     

    
      	 	
              (B)

            	
              Beneficial
                Interests in Restricted Global Preference Shares to Unrestricted
                Definitive Preference Shares.
                A
                holder of a beneficial interest in a Restricted Global Preference
                Share
                may exchange such beneficial interest
                for

            

    

     

    
      
        
        

      

      
        -25-

        
          

        

      

      
        
        

      

    

    an
      Unrestricted Definitive Preference Share or may transfer such beneficial
      interest to a Person who takes delivery thereof in the form of an Unrestricted
      Definitive Preference Share and if:

     

    
      	 	
              (1)

            	
              such
                exchange or transfer is effected pursuant to the Exchange Offer in
                accordance with the Registration Rights Agreement and the holder
                of such
                beneficial interest, in the case of an exchange, or the transferee,
                in the
                case of a transfer, certifies in the applicable Letter of Transmittal
                that
                it is not (1) a Broker-Dealer, (2) a Person participating in the
                distribution of the Exchange Preference Shares or (3) a Person who
                is an
                affiliate (as defined in Rule 144) of the
                Company;

            

    

     

    
      	 	
              (2)

            	
              such
                transfer is effected pursuant to the Shelf Registration Statement
                in
                accordance with the Registration Rights
                Agreement;

            

    

     

    
      	 	
              (3)

            	
              such
                transfer is effected by a Broker-Dealer pursuant to the Exchange
                Offer
                Registration Statement in accordance with the Registration Rights
                Agreement; or

            

    

     

    
      	 	
              (4)

            	
              the
                Company receives the following:

            

    

    

      
        	 	
                (I)

              	
                if
                  the holder of such beneficial interest in a Restricted Global Preference
                  Share proposes to exchange such beneficial interest for an Unrestricted
                  Definitive Preference Share, a certificate from such holder substantially
                  in the form of Exhibit
                  B
                  hereto, including the certifications in item (1)(b) thereof;
                  or

              

      

       

      
        	 	
                (II)

              	
                if
                  the holder of such beneficial interest in a Restricted Global Preference
                  Share proposes to transfer such beneficial interest to a Person
                  who shall
                  take delivery thereof in the form of an Unrestricted Definitive
                  Preference
                  Share, a certificate from such holder substantially in the form
                  of
                  Exhibit
                  A
                  hereto, including the certifications in item (4)
                  thereof;

              

      

       

    

    and,
      in
      each such case set forth in this subparagraph (4), if the Registrar so requests
      or if the Applicable
      Procedures so require, an Opinion of Counsel in form reasonably acceptable
      to
      the Registrar to the effect that such exchange or transfer is in compliance
      with
      the Securities Act and that the restrictions on transfer contained herein and
      in
      the Private Placement Legend are no longer required in order to maintain
      compliance with the Securities Act.

     

    
      	 	
              (C)

            	
              Beneficial
                Interests in Unrestricted Global Preference Shares to Unrestricted
                Definitive Preference Shares.
                If any holder of a beneficial
                interest

            

    

     

    
      
        
        

      

      
        -26-

        
          

        

      

      
        
        

      

    

    in
      an
      Unrestricted Global Preference Share proposes to exchange such beneficial
      interest for a Definitive Preference Share or to transfer such beneficial
      interest to a Person who takes delivery thereof in the form of a Definitive
      Preference Share, and satisfaction of the conditions set forth hereof, the
      Transfer Agent shall cause the aggregate number of the applicable Global
      Preference Shares to be reduced accordingly, and the Company shall execute
      and
      the Transfer Agent shall authenticate and mail to the Person designated in
      the
      instructions a Definitive Preference Share in the applicable number of
      Preference Shares. Any Definitive Preference Share issued in exchange for a
      beneficial interest pursuant to this Section shall be registered in such name
      or
      names and in such authorized denomination or denominations as the holder of
      such
      beneficial interest shall instruct the Registrar through instructions from
      or
      through the Depositary and the Participant or Indirect Participant. The Transfer
      Agent shall mail such Definitive Preference Shares to the Persons in whose
      names
      such Preference Shares are so registered. Any Definitive Preference Share issued
      in exchange for a beneficial interest pursuant to this Section shall not bear
      the Private Placement Legend.

     

    
      	 	
              (iv)

            	
              Transfer
                and Exchange of Definitive Preference Shares for Beneficial
                Interests.

            

    

     

    
      	 	
              (A)

            	
              Restricted
                Definitive Preference Shares to Beneficial Interests in Restricted
                Global
                Preference Shares.
                If any Holder of a Restricted Definitive Preference Share proposes
                to
                exchange such Preference Share for a beneficial interest in a Restricted
                Global Preference Share or to transfer such Restricted Definitive
                Preference Share to a Person who takes delivery thereof in the form
                of a
                beneficial interest in a Restricted Global Preference Share, then,
                upon
                receipt by the Company of the following
                documentation:

            

    

     

    
      	 	
              (1)

            	
              if
                the Holder of such Restricted Definitive Preference Share proposes
                to
                exchange such Preference Share for a beneficial interest in a Restricted
                Global Preference Share, a certificate from such Holder substantially
                in
                the form of Exhibit
                B
                hereto, including the certifications in item (2)(b)
                thereof;

            

    

     

    
      	 	
              (2)

            	
              if
                such Restricted Definitive Preference Share is being transferred
                to a QIB
                in accordance with Rule 144A, a certificate substantially in the
                form of
                Exhibit
                A
                hereto, including the certifications in item (1)
                thereof;

            

    

     

    
      	 	
              (3)

            	
              if
                such Restricted Definitive Preference Share is being transferred
                to a
                Non-U.S. Person in an offshore transaction in accordance with Rule
                903 or
                Rule 904, a certificate substantially in the form of Exhibit
                A
                hereto, including the certifications in item (2)
                thereof;

            

    

     

    
      
        
        

      

      
        -27-

        
          

        

      

      
        
        

      

    

    
      	 	
              (4)

            	
              if
                such Restricted Definitive Preference Share is being transferred
                pursuant
                to an exemption from the registration requirements of the Securities
                Act
                in accordance with Rule 144, a certificate substantially in the form
                of
                Exhibit
                A
                hereto, including the certifications in item (3)(a)
                thereof;

            

    

     

    
      	 	
              (5)

            	
              if
                such Restricted Definitive Preference Share is being transferred
                to the
                Company or any of its subsidiaries, a certificate substantially in
                the
                form of Exhibit
                A
                hereto, including the certifications in item (3)(b) thereof;
                or

            

    

     

    
      	 	
              (6)

            	
              if
                such Restricted Definitive Preference Share is being transferred
                pursuant
                to an effective registration statement under the Securities Act,
                a
                certificate substantially in the form of Exhibit
                A
                hereto, including the certifications in item (3)(c)
                thereof,

            

    

     

    the
      Transfer Agent shall cancel the Restricted Definitive Preference Share, increase
      or cause to be increased the aggregate number of, in the case of clause (1)
      above, the applicable Restricted Global Preference Share, in the case of clause
      (2) above, the applicable 144A Global Preference Share, and in the case of
      clause (3) above, the applicable Regulation S Global Preference
      Share.

     

    
      	 	
              (B)

            	
              Restricted
                Definitive Preference Shares to Beneficial Interests in Unrestricted
                Global Preference Shares.
                A
                Holder of a Restricted Definitive Preference Share may exchange such
                Preference Share for a beneficial interest in an Unrestricted Global
                Preference Share or transfer such Restricted Definitive Preference
                Share
                to a Person who takes delivery thereof in the form of a beneficial
                interest in an Unrestricted Global Preference Share only
                if:

            

    

     

    
      	 	
              (1)

            	
              such
                exchange or transfer is effected pursuant to the Exchange Offer in
                accordance with the Registration Rights Agreement and the Holder,
                in the
                case of an exchange, or the transferee, in the case of a transfer,
                certifies in the applicable Letter of Transmittal that it is not
                (1) a
                Broker-Dealer, (2) a Person participating in the distribution of
                the
                Exchange Preference Shares or (3) a Person who is an affiliate (as
                defined
                in Rule 144) of the Company;

            

    

     

    
      	 	
              (2)

            	
              such
                transfer is effected pursuant to the Shelf Registration Statement
                in
                accordance with the Registration Rights
                Agreement;

            

    

     

    
      	 	
              (3)

            	
              such
                transfer is effected by a Broker-Dealer pursuant to the Exchange
                Offer
                Registration Statement in accordance with the Registration Rights
                Agreement; or

            

    

     

    
      
        
        

      

      
        -28-

        
          

        

      

      
        
        

      

    

    
      	 	
              (4)

            	
              the
                Company receives the following:

            

    

    

      
        	 	
                (I)

              	
                if
                  the Holder of such Definitive Preference Shares proposes to exchange
                  such
                  Preference Shares for a beneficial interest in the Unrestricted
                  Global
                  Preference Share, a certificate from such Holder substantially
                  in the form
                  of Exhibit
                  B
                  hereto, including the certifications in item (1)(c) thereof;
                  or

              

      

       

      
        	 	
                (II)

              	
                if
                  the Holder of such Definitive Preference Shares proposes to transfer
                  such
                  Preference Shares to a Person who shall take delivery thereof in
                  the form
                  of a beneficial interest in the Unrestricted Global Preference
                  Share, a
                  certificate from such Holder substantially in the form of Exhibit
                  A
                  hereto, including the certifications in item (4)
                  thereof;

              

      

       

    

     

    and,
      in
      each such case set forth in this subparagraph (4), if the Registrar so requests
      or if the Applicable Procedures so require, an Opinion of Counsel in form
      reasonably acceptable to the Registrar to the effect that such exchange or
      transfer is in compliance with the Securities Act and that the restrictions
      on
      transfer contained herein and in the Private Placement Legend are no longer
      required in order to maintain compliance with the Securities Act.

     

    Upon
      satisfaction of the conditions of any of the subparagraphs in this Section,
      the
      Transfer Agent shall cancel the Definitive Preference Shares and increase or
      cause to be increased the aggregate number of the Unrestricted Global Preference
      Shares.

     

    
      	 	
              (C)

            	
              Unrestricted
                Definitive Preference Shares to Beneficial Interests in Unrestricted
                Global Preference Shares.
                A
                Holder of an Unrestricted Definitive Preference Share may exchange
                such
                Preference Share for a beneficial interest in an Unrestricted Global
                Preference Share or transfer such Definitive Preference Shares to
                a Person
                who takes delivery thereof in the form of a beneficial interest in
                an
                Unrestricted Global Preference Share at any time. Upon receipt of
                a
                request for such an exchange or transfer, the Transfer Agent shall cancel
                the applicable Unrestricted Definitive Preference Share and increase
                or
                cause to be increased the aggregate number of one of the Unrestricted
                Global Preference Shares.

            

    

     

    If
      any
      such exchange or transfer from a Definitive Preference Share to a beneficial
      interest is effected pursuant to subparagraph (B)(2), (B)(4) or (C) above at
      a
      time when an Unrestricted Global Preference Share has not yet been issued,
      the
      Company shall issue and, upon receipt of an Authentication Order in accordance
      with the provisions under the caption “Transfer and Exchange” hereof, the
      Transfer Agent shall authenticate one or more Unrestricted Global Preference
      Shares in

     

    
      
        
        

      

      
        -29-

        
          

        

      

      
        
        

      

    

    an
      aggregate number of Preference Shares equal to the number of Definitive
      Preference Shares so transferred.

     

    
      	 	
              (v)

            	
              Transfer
                and Exchange of Definitive Preference Shares for Definitive Preference
                Shares.
                Upon request by a Holder of Definitive Preference Shares and such
                Holder's
                compliance with the provisions of this Section, the Registrar shall
                register the transfer or exchange of Definitive Preference Shares.
                Prior
                to such registration of transfer or exchange, the requesting Holder
                shall
                present or surrender to the Registrar the Definitive Preference Shares
                duly endorsed or accompanied by a written instruction of transfer
                in form
                satisfactory to the Registrar duly executed by such Holder or by
                its
                attorney, duly authorized in writing. In addition, the requesting
                Holder
                shall provide any additional certifications, documents and information,
                as
                applicable, required pursuant to the following provisions of this
                Section:

            

    

     

    
      	 	
              (A)

            	
              Restricted
                Definitive Preference Shares to Restricted Definitive Preference
                Shares.
                Any Restricted Definitive Preference Share may be transferred to
                and
                registered in the name of Persons who take delivery thereof in the
                form of
                a Restricted Definitive Preference Share if the Company receives
                the
                following:

            

    

     

    
      	 	
              (1)

            	
              if
                the transfer will be made pursuant to a QIB in accordance with Rule
                144A,
                then the transferor must deliver a certificate substantially in the
                form
                of Exhibit
                A
                hereto, including the certifications in item (1)
                thereof;

            

    

     

    
      	 	
              (2)

            	
              if
                the transfer will be made pursuant to Rule 903 or Rule 904 then the
                transferor must deliver a certificate in the form of Exhibit
                A
                hereto, including the certifications in item (2) thereof;
                or

            

    

     

    
      	 	
              (3)

            	
              if
                the transfer will be made pursuant to any other exemption from the
                registration requirements of the Securities Act, then the transferor
                must
                deliver a certificate in the form of Exhibit
                A
                hereto, including the certifications required by item (3) thereof,
                if
                applicable.

            

    

     

    
      	 	
              (B)

            	
              Restricted
                Definitive Preference Shares to Unrestricted Definitive Preference
                Shares.
                Any Restricted Definitive Preference Share may be exchanged by the
                Holder
                thereof for an Unrestricted Definitive Preference Share or transferred
                to
                a Person or Persons who take delivery thereof in the form of an
                Unrestricted Definitive Preference Share
                if:

            

    

     

    
      	 	
              (1)

            	
              such
                exchange or transfer is effected pursuant to the Exchange Offer in
                accordance with the Registration Rights Agreement and the Holder,
                in the
                case of an exchange, or the transferee, in the case of a transfer,
                certifies in the applicable Letter of Transmittal that it
                is

            

    

     

    
      
        
        

      

      
        -30-

        
          

        

      

      
        
        

      

    

    not
      (1) a
      Broker-Dealer, (2) a Person participating in the distribution of the Exchange
      Preference Shares or (3) a Person who is an affiliate (as defined in Rule 144)
      of the Company;

     

    
      	 	
              (2)

            	
              any
                such transfer is effected pursuant to the Shelf Registration Statement
                in
                accordance with the Registration Rights
                Agreement;

            

    

     

    
      	 	
              (3)

            	
              any
                such transfer is effected by a Broker-Dealer pursuant to the Exchange
                Offer Registration Statement in accordance with the Registration
                Rights
                Agreement; or

            

    

     

    
      	 	
              (4)

            	
              the
                Company receives the following:

            

    

    

      
        	 	
                (I)

              	
                if
                  the Holder of such Restricted Definitive Preference Shares proposes
                  to
                  exchange such Preference Shares for an Unrestricted Definitive
                  Preference
                  Share, a certificate from such Holder substantially in the
                  form of
                  Exhibit
                  B
                  hereto, including the certifications in item (1)(d) thereof;
                  or

              

      

       

      
        	 	
                (II)

              	
                if
                  the Holder of such Restricted Definitive Preference Shares proposes
                  to
                  transfer such Preference Shares to a Person who shall take delivery
                  thereof in the form of an Unrestricted Definitive Preference Share,
                  a
                  certificate from such Holder substantially in the form of Exhibit
                  A
                  hereto, including the certifications in item (4)
                  thereof;

              

      

       

    

    and,
      in
      each such case set forth in this subparagraph (4), if the Registrar so requests,
      an Opinion of Counsel in form reasonably acceptable to the Registrar to the
      effect that such exchange or transfer is in compliance with the Securities
      Act
      and that the restrictions on transfer contained herein and in the Private
      Placement Legend are no longer required in order to maintain compliance with
      the
      Securities Act.

     

    
      	 	
              (C)

            	
              Unrestricted
                Definitive Preference Shares to Unrestricted Definitive Preference
                Shares.
                A
                Holder of Unrestricted Definitive Preference Shares may transfer
                such
                Preference Shares to a Person who takes delivery thereof in the form
                of an
                Unrestricted Definitive Preference Share. Upon receipt of a request
                to
                register such a transfer, the Registrar shall register the Unrestricted
                Definitive Preference Shares pursuant to the instructions from the
                Holder
                thereof.

            

    

     

    
      	 	
              (vi)

            	
              Exchange
                Offer.
                Upon the occurrence of the Exchange Offer in accordance with the
                Registration Rights Agreement, the Company shall issue and, upon
                receipt
                of an Authentication Order, the Transfer Agent shall authenticate
                (i) one
                or more Unrestricted Global Preference Shares in an aggregate number
                of
                Preference Shares equal to the number of the beneficial interests
                in the
                Restricted Global

            

    

     

    
      
        
        

      

      
        -31-

        
          

        

      

      
        
        

      

    

    Preference
      Shares tendered for acceptance by Persons that certify in the applicable Letters
      of Transmittal that (x) they are not Broker-Dealers, (y) they are not
      participating in a distribution of the Exchange Preference Shares and (z) they
      are not affiliates (as defined in Rule 144) of the Company, and accepted for
      exchange in the Exchange Offer and (ii) Unrestricted Definitive Preference
      Shares in an aggregate number of Preference Shares equal to the number of the
      Restricted Definitive Preference Shares tendered for acceptance by Persons
      that
      certify in the applicable Letters of Transmittal that (x) they are not
      Broker-Dealers, (y) they are not participating in a distribution of the Exchange
      Preference Shares and (z) they are not affiliates (as defined in Rule 144)
      of
      the Company, and accepted for exchange in the Exchange Offer. Concurrently
      with
      the issuance of such Preference Shares, the Transfer Agent shall cause the
      aggregate number of Preference Shares of the applicable Restricted Global
      Preference Shares to be reduced accordingly, and the Company shall execute
      and
      the Transfer Agent shall authenticate and mail to the Persons designated by
      the
      Holders of Definitive Preference Shares so accepted Unrestricted Definitive
      Preference Shares in the applicable principal amount. Any Preference Shares
      that
      remain outstanding after the consummation of the Exchange Offer, and Exchange
      Preference Shares issued in connection with the Exchange Offer, shall be treated
      as a single class of securities under these Resolutions.

     

    
      	 	
              (vii)

            	
              Legends.
                The following legends shall appear on the face of all Global Preference
                Shares and Definitive Preference Shares issued under these Resolutions
                unless specifically stated otherwise in the applicable provisions
                of these
                Resolutions:

            

    

     

    
      	 	
              (A)

            	
              Private
                Placement Legend.

            

    

     

    
      	 	
              (1)

            	
              Except
                as permitted by subparagraph (2) below, each Global Preference Share
                and
                each Definitive Preference Share (and all Preference Shares issued
                in
                exchange therefor or substitution thereof) shall bear the legend
                in
                substantially the following form:

            

    

     

    “THE
      SECURITY EVIDENCED HEREBY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT
      OF
      1933, AS AMENDED (THE “SECURITIES ACT”) OR OTHER SECURITIES LAW. NEITHER THIS
      SECURITY NOR ANY INTEREST OR PARTICIPATION HEREIN MAY BE REOFFERED, SOLD,
      ASSIGNED, TRANSFERRED, PLEDGED, ENCUMBERED OR OTHERWISE DISPOSED OF IN THE
      ABSENCE OF SUCH REGISTRATION OR UNLESS THE TRANSACTION IS EXEMPT FROM, OR NOT
      SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES ACT. EACH PURCHASER
      OF THE SECURITY EVIDENCED HEREBY IS HEREBY NOTIFIED THAT THE SELLER MAY BE
      RELYING ON THE EXEMPTION FROM SECTION 5 OF THE SECURITIES ACT PROVIDED BY RULE
      144A THEREUNDER. THE

     

    
      
        
        

      

      
        -32-

        
          

        

      

      
        
        

      

    

    HOLDER
      OF
      THIS SECURITY BY ITS ACCEPTANCE HEREOF (1) REPRESENTS THAT (A) IT IS A
“QUALIFIED INSTITUTIONAL BUYER” (AS DEFINED IN RULE 144A UNDER THE SECURITIES
      ACT) OR (B) IT IS NOT A U.S. PERSON AND IS ACQUIRING ITS SECURITY IN AN
“OFFSHORE TRANSACTION” PURSUANT TO RULE 904 OF REGULATION S UNDER THE SECURITIES
      ACT, (2) AGREES THAT IT WILL NOT PRIOR TO (X) THE DATE WHICH IS TWO YEARS (OR
      SUCH SHORTER PERIOD OF TIME AS PERMITTED BY RULE 144(K) UNDER
      THE
      SECURITIES ACT OR ANY SUCCESSOR PROVISION THEREUNDER) AFTER THE LATER OF THE
      ORIGINAL ISSUE DATE HEREOF (OR OF ANY PREDECESSOR OF THIS SECURITY) OR THE
      LAST
      DAY ON WHICH THE COMPANY OR ANY AFFILIATE OF THE COMPANY WAS THE OWNER OF THIS
      SECURITY (OR ANY PREDECESSOR OF THIS SECURITY) AND (Y) SUCH LATER DATE, IF
      ANY,
      AS MAY BE REQUIRED BY APPLICABLE LAW (THE “RESALE RESTRICTION TERMINATION
      DATE”), OFFER, SELL OR OTHERWISE TRANSFER THIS PREFERENCE SHARE EXCEPT (A) TO
      THE COMPANY, (B) PURSUANT TO A REGISTRATION STATEMENT WHICH HAS BEEN DECLARED
      EFFECTIVE UNDER THE SECURITIES ACT, (C) FOR SO LONG AS THE SECURITY IS ELIGIBLE
      FOR RESALE PURSUANT TO RULE 144A, TO A PERSON IT REASONABLY BELIEVES IS A
“QUALIFIED INSTITUTIONAL BUYER” AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT
      THAT PURCHASES FOR ITS OWN ACCOUNT OR FOR THE ACCOUNT OF A QUALIFIED
      INSTITUTIONAL BUYER TO WHOM NOTICE IS GIVEN THAT THE TRANSFER IS BEING MADE
      IN
      RELIANCE ON RULE 144A, (D) PURSUANT TO OFFERS AND SALES TO NON-U.S. PERSONS
      THAT
      OCCUR OUTSIDE THE UNITED STATES WITHIN THE MEANING OF REGULATION S UNDER THE
      SECURITIES ACT OR (E) PURSUANT TO ANY OTHER AVAILABLE EXEMPTION FROM THE
      REGISTRATION REQUIREMENTS OF THE SECURITIES ACT AND (3) AGREES THAT IT WILL
      GIVE
      TO EACH PERSON TO WHOM THIS SECURITY IS TRANSFERRED A NOTICE SUBSTANTIALLY
      TO
      THE EFFECT OF THIS LEGEND; PROVIDED THAT THE COMPANY, THE TRANSFER AGENT AND
      THE
      REGISTRAR SHALL HAVE THE RIGHT PRIOR TO ANY SUCH OFFER, SALE OR TRANSFER
      PURSUANT TO CLAUSE (D) OR (E) TO REQUIRE THE DELIVERY OF AN OPINION OF COUNSEL,
      CERTIFICATION AND/ OR OTHER INFORMATION SATIS-

     

    
      
        
        

      

      
        -33-

        
          

        

      

      
        
        

      

    

    FACTORY
      TO EACH OF
      THEM.
      THIS LEGEND
      WILL BE REMOVED UPON THE REQUEST OF THE HOLDER AFTER THE RESALE RESTRICTION
      TERMINATION DATE.
      AS USED
      HEREIN, THE TERMS “OFFSHORE TRANSACTION”, “UNITED STATES” AND “U.S. PERSON” HAVE
      THE MEANINGS GIVEN TO THEM BY REGULATION S UNDER THE SECURITIES
      ACT.”

     

    
      	 	
              (2)

            	
              Notwithstanding
                the foregoing, any Global Preference Share or Definitive Preference
                Share
                issued pursuant to subparagraph (ii)(D), (iii)(C), (iii)(D), (iv)(B),
                (iv)(C), (v)(B), (v)(C) or (vi) under the section captioned “Transfer and
                Exchange” hereof (and all Preference Shares issued in exchange therefor or
                substitution thereof) shall not bear the Private Placement
                Legend.

            

    

     

    
      	 	
              (B)

            	
              Global
                Preference Share Legend.
                Each Global Preference Share shall bear a legend in substantially
                the
                following form:

            

    

     

    “THIS
      GLOBAL PREFERENCE SHARE IS HELD BY THE DEPOSITARY (AS DEFINED IN THE RESOLUTIONS
      SETTING FORTH THE TERMS, RIGHTS AND PREFERENCES OF THIS PREFERENCE SHARE) OR
      ITS
      NOMINEE IN CUSTODY FOR THE BENEFIT OF THE BENEFICIAL OWNERS HEREOF, AND IS
      NOT
      TRANSFERABLE TO ANY PERSON UNDER ANY CIRCUMSTANCES EXCEPT THAT (I) THE TRANSFER
      AGENT MAY MAKE SUCH NOTATIONS HEREON AS MAY BE REQUIRED PURSUANT TO THE
      RESOLUTIONS, (II) THIS GLOBAL PREFERENCE SHARE MAY BE EXCHANGED IN WHOLE BUT
      NOT
      IN PART PURSUANT TO THE RESOLUTIONS, (III) THIS GLOBAL PREFERENCE SHARE MAY
      BE
      DELIVERED TO THE TRANSFER AGENT FOR CANCELLATION PURSUANT TO THE RESOLUTIONS
      AND
      (IV) THIS GLOBAL PREFERENCE SHARE MAY BE TRANSFERRED TO A SUCCESSOR DEPOSITARY
      WITH THE PRIOR WRITTEN CONSENT OF THE COMPANY. UNLESS AND UNTIL IT IS EXCHANGED
      IN WHOLE OR IN PART FOR PREFERENCE SHARES IN DEFINITIVE FORM, THIS PREFERENCE
      SHARE MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE DEPOSITARY TO A NOMINEE
      OF
      THE DEPOSITARY OR BY A NOMINEE OF THE DEPOSITARY TO THE DEPOSITARY OR ANOTHER
      NOMINEE OF THE DEPOSITARY OR BY THE DEPOSITARY OR ANY SUCH NOMINEE TO A
      SUCCESSOR DEPOSITARY OR A NOMINEE OF SUCH SUCCESSOR DEPOSITARY. UNLESS THIS
      CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE DEPOSITORY
      TRUST
      COMPANY (55 WATER STREET, NEW YORK, NEW YORK) (“DTC”) TO THE COMPANY OR THEIR
      AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE OR PAYMENT, AND ANY
      CER-

     

    
      
        
        

      

      
        -34-

        
          

        

      

      
        
        

      

    

    TIFICATE
      ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR SUCH OTHER NAME AS MAY BE
      REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
      CEDE & CO. OR SUCH OTHER ENTITY AS MAY BE REQUESTED BY AN AUTHORIZED
      REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE OR OTHER USE HEREOF FOR VALUE
      OR
      OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
      HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.”

     

    
      	 	
              (viii)

            	
              Cancellation
                and/or Adjustment of Global Preference Shares.
                At such time as all beneficial interests in a particular Global Preference
                Share have been exchanged for Definitive Preference Shares or a particular
                Global Preference Share has been redeemed, repurchased or canceled
                in
                whole and not in part, each such Global Preference Share shall be
                returned
                to or retained and canceled by the Transfer Agent. At any time prior
                to
                such cancellation, if any beneficial interest in a Global Preference
                Share
                is exchanged for or transferred to a Person who will take delivery
                thereof
                in the form of a beneficial interest in another Global Preference
                Share or
                for Definitive Preference Shares, the number of Preference Shares
                represented by such Global Preference Share shall be reduced accordingly
                and an endorsement shall be made on such Global Preference Share
                by the
                Transfer Agent or by the Depositary at the direction of the Transfer
                Agent
                to reflect such reduction; and if the beneficial interest is being
                exchanged for or transferred to a Person who will take delivery thereof
                in
                the form of a beneficial interest in another Global Preference Share,
                such
                other Global Preference Share shall be increased accordingly and
                an
                endorsement shall be made on such Global Preference Share by the
                Transfer
                Agent or by the Depositary at the direction of the Transfer Agent
                to
                reflect such increase.

            

    

     

    
      	
              3.6

            	
              Approval
                of Transactions and Share
                Offering

            

    

    
       

      
        	
                (a)

              	
                RESOLVED
                  that the Company be, and it hereby is, authorized to issue and
                  sell up to
                  the Series A Aggregate Available Liquidation Preference of Series
                  A
                  Preference Shares, par value US$0.01 per share, in accordance with
                  the
                  terms and conditions of the Purchase Agreement. All determinations
                  in
                  respect of the Series A Preference Shares made by any officer or
                  director
                  of the Company, including, without limitation, approval of the
                  form of
                  share certificates, are hereby ratified and
                  confirmed.

              

      

    

    
      
         

        
          	
                  (b)

                	
                  RESOLVED
                    that the Company is, and it hereby is, authorized to make any
                    periodic
                    payments required under the
                    Documents.

                

        

      

    

    
      
        
           

          
            	
                    (c)

                  	
                    RESOLVED
                      that any officer or director of the Company be, and each of
                      them
                      individually hereby is, authorised and directed in the name
                      and on behalf
                      of the Company to agree (in his or their absolute discretion
                      and including
                      any variations to the forms and terms thereof) to the terms
                      and conditions
                      of and (where appropriate) to execute under hand, under seal
                      or as a deed
                      and deliver, in the name and on behalf of the Company,
                      the

                  

          

        

      

       

    

     

    
      
        
        

      

      
        -35-

        
          

        

      

      
        
        

      

    

    documents
      relating to the Series A Preference Shares and the Transactions (including,
      without limitation, the Documents) and any and all other documents, instruments
      and certificates considered in the absolute discretion of such director or
      officer necessary, desirable or advisable to complete the Transactions described
      at the Meeting, execution thereof by any officer or Director of the Company
      being conclusive evidence of his or their and the Company’s agreement to the
      final terms and conditions of such Documents or any other
      documents.

    
      
        
           

          
            	
                    (d)

                  	RESOLVED that the Company is hereby authorized
                    to appoint
                    The Bank of New York to serve as Transfer Agent, Paying Agent
                    and
                    Registrar with respect to the Series A Preference
                    Shares.

          

        

      

      
        
          
            
              
                
                  
                     

                    
                      	
                              (e)

                            	RESOLVED that the Company is hereby
                              authorized to appoint
                              CT
                              Corporation System, New York, New York
                              to
                              serve as its authorized agent for service of process
                              with respect to the
                              Series A Preference
                              Shares.

                    

                  

                

                
                  
                    
                       

                    

                  

                

              

            

          

        

      

    

    
      	
              3.7

            	
              Approval
                of General Enabling
                Resolutions

            

    

    
      
        
           

          
            	
                    (a)

                  	RESOLVED that any officer or Director of the
                    Company be,
                    and each of them individually hereby is, authorized and directed
                    in the
                    name and on behalf of the Company, to (i) take or cause to be
                    taken any
                    and all such further actions (including, without limitation,
                    execution and
                    delivery of such deeds, contracts, agreements, instruments, documents
                    and
                    certificates as each of them shall deem in his or her absolute
                    discretion
                    necessary, advisable or desirable, such execution and delivery
                    being
                    conclusive evidence of it being so deemed) and to cause the Company
                    to
                    prepare, execute and deliver and where necessary or appropriate,
                    file or
                    cause to be filed with the appropriate governmental authorities,
                    all such
                    other instruments and documents, including, but not limited to,
                    all
                    certificates, contracts, bonds, agreements, documents, instruments,
                    receipts or other papers, (ii) incur and pay or cause to be paid
                    all fees
                    and expenses, and (iii) engage such persons as they shall in
                    their
                    judgment determine to be necessary or appropriate to carry out
                    fully the
                    intent and purposes of the foregoing resolutions and each of
                    the
                    transactions contemplated
                    thereby.

          

        

      

      
        
          
            
              
                
                  
                    
                      
                        
                          
                             

                            
                              	
                                      (b)

                                    	RESOLVED
                                      that any person dealing with any officer or
                                      Director of the Company in
                                      connection with any of the foregoing matters
                                      shall be conclusively
                                      entitled to rely upon the authority of such
                                      officer or Director and by his
                                      execution of any document, agreement, instrument
                                      or certificate, the same
                                      shall be a valid and binding obligation of
                                      the Company enforceable in
                                      accordance with its
                                      terms.

                            

                          

                        

                        
                          
                            
                              
                                
                                  
                                    
                                       

                                      
                                        	
                                                (c)

                                              	RESOLVED
                                                that all actions previously taken
                                                by any officer or Director of the
                                                Company in connection with the actions
                                                contemplated by the foregoing
                                                resolutions be, and each hereby is,
                                                adopted, ratified, confirmed and
                                                approved in all
                                                respects.

                                      

                                    

                                  

                                  
                                    
                                      
                                         

                                        
                                          
                                            
                                            

                                          

                                          
                                            -36-

                                            
                                              

                                            

                                          

                                          
                                            
                                            

                                          

                                        

                                      

                                    

                                  

                                

                              

                            

                          

                        

                      

                    

                  

                

              

            

          

        

      

    

    

    EXHIBIT
      A

     

    FORM
      OF
      CERTIFICATE OF TRANSFER

     

    Security
      Capital Assurance Ltd

    One
      Bermudiana Road

    Hamilton
      HM 11

    Bermuda
      

    Fax
      No.:

    Attention:
      

     

    The
      Bank
      of New York

    101
      Barclay Street (12W)

    New
      York,
      New York 10128

     

    Fax:

    Attention:
      Corporate Trust Administration

     

    Re:
      Fixed/Floating Series A Perpetual Non-Cumulative Preference Shares

     

    Reference
      is hereby made to the Resolutions, dated as of March 29, 2007 (the “Resolutions”),
      of
      the Subcommittee of the Board of Directors of Security Capital Assurance Ltd.
      Capitalized terms used but not defined herein shall have the meanings given
      to
      them in the Resolutions.

     

    _____________
      (the “Transferor”)
      owns
      and proposes to transfer the [ ] Preference Share[s] or interest in such
      Preference Share[s] specified in Annex A hereto or interests (the “Transfer”),
      to
      __________ (the “Transferee”),
      as
      further specified in Annex A hereto. In connection with the Transfer, the
      Transferor hereby certifies that:

     

    [CHECK
      ALL THAT APPLY]

     

    1. [
      ] CHECK
      IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL INTEREST IN THE 144A GLOBAL
      PREFERENCE SHARE OR A DEFINITIVE PREFERENCE SHARE PURSUANT TO RULE 144A. The
      Transfer is being effected pursuant to and in accordance with Rule 144A under
      the United States Securities Act of 1933, as amended (the “Securities
      Act”),
      and,
      accordingly, the Transferor hereby further certifies that the beneficial
      interest or Definitive Preference Share is being transferred to a Person that
      the Transferor reasonably believes is purchasing the beneficial interest or
      Definitive Preference Share for its own account, or for one or more accounts
      with respect to which such Person exercises sole investment discretion, and
      such
      Person and each such account is a “qualified institutional buyer” within the
      meaning of Rule 144A in a transaction meeting the requirements of Rule 144A
      and
      such Transfer is in compliance with any applicable blue sky securities laws
      of
      any state of the United States.

     

    
      
        
        

      

      
        
          A-1

        

        
          

        

      

      
        
        

      

    

    2. [
      ] CHECK
      IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL INTEREST IN THE REGULATION
      S
      GLOBAL PREFERENCE SHARE OR A DEFINITIVE PREFERENCE SHARE PURSUANT TO REGULATION
      S. The Transfer is being effected pursuant to and in accordance with Rule 903
      or
      Rule 904 under the Securities Act and, accordingly, the Transferor hereby
      further certifies that (i) the Transfer is not being made to a person in the
      United States and (x) at the time the buy order was originated, the Transferee
      was outside the United States or such Transferor and any Person acting on its
      behalf reasonably believed and believes that the Transferee was outside the
      United States or (y) the transaction was executed in, on or through the
      facilities of a designated offshore securities market and neither such
      Transferor nor any Person acting on its behalf knows that the transaction was
      prearranged with a buyer in the United States, (ii) no directed selling efforts
      have been made in contravention of the requirements of Rule 903(b) or Rule
      904(b) of Regulation S under the Securities Act (iii) the transaction is not
      part of a plan or scheme to evade the registration requirements of the
      Securities Act and (iv) if the proposed transfer is being made prior to the
      expiration of the Restricted Period, the transfer is not being made to a U.S.
      Person or for the account or benefit of a U.S. Person (other than an Initial
      Purchaser). Upon consummation of the proposed transfer in accordance with the
      terms of the Resolutions, the transferred beneficial interest or Definitive
      Preference Share will be subject to the restrictions on Transfer enumerated
      in
      the Resolutions and the Securities Act.

     

    3. [
      ] CHECK
      AND COMPLETE IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL INTEREST IN THE
      DEFINITIVE PREFERENCE SHARE PURSUANT TO ANY PROVISION OF THE SECURITIES ACT
      OTHER THAN RULE 144A OR REGULATION S. The Transfer is being effected in
      compliance with the transfer restrictions applicable to beneficial interests
      in
      Restricted Global Preference Shares and Restricted Definitive Preference Shares
      and pursuant to and in accordance with the Securities Act and any applicable
      blue sky securities laws of any state of the United States, and accordingly
      the
      Transferor hereby further certifies that (check one):

     

    (a) [
      ] such
      Transfer is being effected pursuant to and in accordance with Rule 144 under
      the
      Securities Act;

     

    or

     

    (b) [
      ] such
      Transfer is being effected to the Company or a subsidiary thereof;

    or

     

    (c) [
      ] such
      Transfer is being effected pursuant to an effective registration statement
      under
      the Securities Act and in compliance with the prospectus delivery requirements
      of the Securities Act.

     

    4. [
      ] CHECK
      IF TRANSFEREE WILL TAKE DELIVERY OF A BENEFICIAL INTEREST IN AN UNRESTRICTED
      GLOBAL PREFERENCE SHARE OR OF AN UNRESTRICTED DEFINITIVE PREFERENCE
      SHARE.

     

    
      
        
        

      

      
        
          A-2

        

        
          

        

      

      
        
        

      

    

    (a) [
      ] CHECK
      IF TRANSFER IS PURSUANT TO RULE 144. (i) The Transfer is being effected pursuant
      to and in accordance with Rule 144 under the Securities Act and in compliance
      with the transfer restrictions contained in the Resolutions and any applicable
      blue sky securities laws of any state of the United States and (ii) the
      restrictions on transfer contained in the Resolutions and the Private Placement
      Legend are not required in order to maintain compliance with the Securities
      Act.
      Upon consummation of the proposed Transfer in accordance with the terms of
      the
      Resolutions, the transferred beneficial interest or Definitive Preference Shares
      will no longer be subject to the restrictions on transfer enumerated in the
      Private Placement Legend printed on the Restricted Global Preference Share,
      on
      Restricted Definitive Preference Shares and in the Resolutions.

     

    (b) [
      ] CHECK
      IF TRANSFER IS PURSUANT TO REGULATION S. (i) The Transfer is being effected
      pursuant to and in accordance with Rule 903 or Rule 904 under the Securities
      Act
      and in compliance with the transfer restrictions contained in the Resolutions
      and any applicable blue sky securities laws of any state of the United States
      and (ii) the restrictions on transfer contained in the Resolutions and the
      Private Placement Legend are not required in order to maintain compliance with
      the Securities Act. Upon consummation of the proposed Transfer in accordance
      with the terms of the Resolutions, the transferred beneficial interest or
      Definitive Preference Share will no longer be subject to the restrictions on
      transfer enumerated in the Private Placement Legend printed on the Restricted
      Global Preference Shares, on Restricted Definitive Preference Shares and in
      the
      Resolutions.

     

    (c) [
      ] CHECK
      IF TRANSFER IS PURSUANT TO OTHER EXEMPTION. (i) The Transfer is being effected
      pursuant to and in compliance with an exemption from the registration
      requirements of the Securities Act other than Rule 144, Rule 903 or Rule 904
      and
      in compliance with the transfer restrictions contained in the Resolutions and
      any applicable blue sky securities laws of any State of the United States and
      (ii) the restrictions on transfer contained in the Resolutions and the Private
      Placement Legend are not required in order to maintain compliance with the
      Securities Act. Upon consummation of the proposed Transfer in accordance with
      the terms of the Resolutions, the transferred beneficial interest or Definitive
      Preference Shares will not be subject to the restrictions on transfer enumerated
      in the Private Placement Legend printed on the Restricted Global Preference
      Shares or Restricted Definitive Preference Shares and in the
      Resolutions.

     

    This
      certificate and the statements contained herein are made for your benefit and
      the benefit of the Company.

     

    [Insert
      Name of Transferor]

     

    By: 
      __________________________________________

    Name:

    Title:

    Dated: 
      _________________________________

     

    

    
      
        
           

        

        
          A-3

        

      

      
        
        

        
          

        

      

      
        
        

        
        

      

    

    ANNEX
      A
      TO CERTIFICATE OF TRANSFER

     

    1.     The
      Transferor owns and proposes to transfer the following:

     

    [CHECK
      ONE OF (a) OR (b)]

     

    (a) [
      ] a
      beneficial interest in the:

     

    
      	 	
              (i)

            	
              [
                ]
                144A Global Preference Share ([CUSIP
                [         ]/ISIN
                [         ]
                or

            

    

     

    
      	 	
              (ii)

            	
              [
                ]
                Regulation S Global Preference Share ([CUSIP
                [         ]/ISIN
                [         ] or [CUSIP
                [         ]/ISIN
                [         ])

            

    

     

    (b) [
      ] a
      Restricted Definitive Preference Share.

     

    2.  
       After
      the
      Transfer the Transferee will hold:

     

    [CHECK
      ONE]

     

    (a) [
      ] a
      beneficial interest in the:

     

    
      	 	
              (i)

            	
              [
                ]
                144A Global Preference Share ([CUSIP
                [         ]/ISIN
                [         ] or [CUSIP
                [         ]/ISIN
                [         ]),
                or

            

    

     

    
      	 	
              (ii)

            	
              [
                ]
                Regulation S Global Preference Share ([CUSIP
                [         ] 0/ISIN
                [         ] or [CUSIP
                [         ]/ISIN
                [         ])
                or

            

    

     

    
      	 	
              (iii)

            	
              [
                ]
                Unrestricted Global Preference Share ([CUSIP
                [         ]/ISIN
                [         ]
                or
                [CUSIP [         ]/ISIN
                [         ]

            

    

     

    (b) [
      ] a
      Restricted Definitive Preference Share; or

     

    
      	 	
              (c)

            	
              [
                ]
                an Unrestricted Definitive Preference Share, in accordance with the
                terms
                of the Resolutions.

            

    

     

    

    
      
        
        

      

      
        A-4

        
          

        

      

      
        
        

      

    

    EXHIBIT
      B

     

    FORM
      OF
      CERTIFICATE OF EXCHANGE

     

    Security
      Capital Assurance Ltd

    One
      Bermudiana Road

    Hamilton
      HM 11

    Bermuda
      

    Fax
      No.:

    Attention:
      

     

    The
      Bank
      of New York

    101
      Barclay Street (12W)

    New
      York,
      New York 10128

     

    Fax:

    Attention:
      Corporate Trust Administration

     

    Re:
      Fixed/Floating Series A Perpetual Non-Cumulative Preference Shares

     

    Reference
      is hereby made to the Resolutions, dated as of March 29, 2007 (the “Resolutions”),
      of
      the Subcommittee of the Board of Directors of Security Capital Assurance Ltd.
      Capitalized terms used but not defined herein shall have the meanings given
      to
      them in the Resolutions.

     

    _________________
      (the “Owner”)
      owns
      and proposes to exchange [ ] Preference Share[s] or interest in such Preference
      Share[s] specified herein (the “Exchange”).
      In
      connection with the Exchange, the Owner hereby certifies that:

     

    1) EXCHANGE
      OF RESTRICTED DEFINITIVE PREFERENCE SHARES OR BENEFICIAL INTERESTS IN A
      RESTRICTED GLOBAL PREFERENCE SHARES FOR UNRESTRICTED DEFINITIVE PREFERENCE
      SHARES OR BENEFICIAL INTERESTS IN AN UNRESTRICTED GLOBAL PREFERENCE
      SHARES

     

    a) [
      ] CHECK
      IF EXCHANGE IS FROM BENEFICIAL INTEREST IN A RESTRICTED GLOBAL PREFERENCE SHARE
      TO BENEFICIAL INTEREST IN AN UNRESTRICTED GLOBAL PREFERENCE SHARE. In connection
      with the Exchange of the Owner’s beneficial interest in a Restricted Global
      Preference Share for a beneficial interest in an Unrestricted Global Preference
      Share in an equal number of shares, the Owner hereby certifies (i) the
      beneficial interest is being acquired for the Owner’s own account without
      transfer, (ii) such Exchange has been effected in compliance with the transfer
      restrictions applicable to the Global Preference Shares and pursuant to and
      in
      accordance with the United States Securities Act of 1933, as amended (the
“Securities
      Act”),
      (iii)
      the restrictions on transfer contained in the Resolutions and the Private
      Placement Legend are not required in order to maintain compliance with the
      Securities

     

    
      
        
        

      

      
        B-1

        
          

        

      

      
        
        

      

    

    Act
      and
      (iv) the beneficial interest in an Unrestricted Global Preference Share is
      being
      acquired in compliance with any applicable blue sky securities laws of any
      state
      of the United States.

     

    b) [
      ] CHECK
      IF EXCHANGE IS FROM BENEFICIAL INTEREST IN A RESTRICTED GLOBAL PREFERENCE SHARE
      TO UNRESTRICTED DEFINITIVE PREFERENCE SHARE. In connection with the Exchange
      of
      the Owner’s beneficial interest in a Restricted Global Preference Share for an
      Unrestricted Definitive Preference Share, the Owner hereby certifies (i) the
      Definitive Preference Share is being acquired for the Owner’s own account
      without transfer, (ii) such Exchange has been effected in compliance with the
      transfer restrictions applicable to the Restricted Global Preference Shares
      and
      pursuant to and in accordance with the Securities Act, (iii) the restrictions
      on
      transfer contained in the Resolutions and the Private Placement Legend are
      not
      required in order to maintain compliance with the Securities Act and (iv) the
      Definitive Preference Share is being acquired in compliance with any applicable
      blue sky securities laws of any state of the United States.

     

    c) [
      ] CHECK
      IF EXCHANGE IS FROM RESTRICTED DEFINITIVE PREFERENCE SHARE TO BENEFICIAL
      INTEREST IN AN UNRESTRICTED GLOBAL PREFERENCE SHARE. In connection with the
      Owner’s Exchange of a Restricted Definitive Preference Share for a beneficial
      interest in an Unrestricted Global Preference Share, the Owner hereby certifies
      (i) the beneficial interest is being acquired for the Owner’s own account
      without transfer, (ii) such Exchange has been effected in compliance with the
      transfer restrictions applicable to Restricted Definitive Preference Shares
      and
      pursuant to and in accordance with the Securities Act, (iii) the restrictions
      on
      transfer contained in the Resolutions and the Private Placement Legend are
      not
      required in order to maintain compliance with the Securities Act and (iv) the
      beneficial interest is being acquired in compliance with any applicable blue
      sky
      securities laws of any state of the United States.

     

    d) [
      ] CHECK
      IF EXCHANGE IS FROM RESTRICTED DEFINITIVE PREFERENCE SHARE TO UNRESTRICTED
      DEFINITIVE PREFERENCE SHARE. In connection with the Owner’s Exchange of a
      Restricted Definitive Preference Share for an Unrestricted Definitive Preference
      Share, the Owner hereby certifies (i) the Unrestricted Definitive Preference
      Share is being acquired for the Owner’s own account without transfer, (ii) such
      Exchange has been effected in compliance with the transfer restrictions
      applicable to Restricted Definitive Preference Shares and pursuant to and in
      accordance with the Securities Act, (iii) the restrictions on transfer contained
      in the Resolutions and the Private Placement Legend are not required in order
      to
      maintain compliance with the Securities Act and (iv) the Unrestricted Definitive
      Preference Share is being acquired in compliance with any applicable blue sky
      securities laws of any state of the United States.

     

    2) EXCHANGE
      OF RESTRICTED DEFINITIVE PREFERENCE SHARES OR BENEFICIAL INTERESTS IN RESTRICTED
      GLOBAL PREFERENCE SHARES FOR

     

    
      
        
        

      

      
        B-2

        
          

        

      

      
        
        

      

    

    RESTRICTED
      DEFINITIVE PREFERENCE SHARES OR BENEFICIAL INTERESTS IN RESTRICTED GLOBAL
      PREFERENCE SHARES

     

    a) [
      ] CHECK
      IF EXCHANGE IS FROM BENEFICIAL INTEREST IN A RESTRICTED GLOBAL PREFERENCE SHARES
      TO RESTRICTED DEFINITIVE PREFERENCE SHARE. In connection with the Exchange
      of
      the Owner’s beneficial interest in a Restricted Global Preference Share for a
      Restricted Definitive Preference Share with an equal number of shares, the
      Owner
      hereby certifies that the Restricted Definitive Preference Share is being
      acquired for the Owner’s own account without transfer. Upon consummation of the
      proposed Exchange in accordance with the terms of the Resolutions, the
      Restricted Definitive Preference Share issued will continue to be subject to
      the
      restrictions on transfer enumerated in the Private Placement Legend printed
      on
      the Restricted Definitive Preference Share and in the Resolutions and the
      Securities Act.

     

    b) [
      ] CHECK
      IF EXCHANGE IS FROM RESTRICTED DEFINITIVE PREFERENCE SHARE TO BENEFICIAL
      INTEREST IN A RESTRICTED GLOBAL PREFERENCE SHARE. In connection with the
      Exchange of the Owner’s Restricted Definitive Preference Share for a beneficial
      interest in the [CHECK ONE] [ ] 144A Global Preference Share [ ] Regulation
      S
      Global Preference Share, with an equal number of shares, the Owner hereby
      certifies (i) the beneficial interest is being acquired for the Owner’s own
      account without transfer and (ii) such Exchange has been effected in compliance
      with the transfer restrictions applicable to the Restricted Global Preference
      Share and pursuant to and in accordance with the Securities Act, and in
      compliance with any applicable blue sky securities laws of any state of the
      United States. Upon consummation of the proposed Exchange in accordance with
      the
      terms of the Resolutions, the beneficial interest issued will be subject to
      the
      restrictions on transfer enumerated in the Private Placement Legend printed
      on
      the relevant Restricted Global Preference Share and in the Resolutions and
      the
      Securities Act.

     

    This
      certificate and the statements contained herein are made for your benefit and
      the benefit of the Company and are dated.

     

    
      [Insert
        Name of Transferor]

       

      By: 
        __________________________________________

      Name:

      Title:

      Dated: 
        _________________________________

       

    

     

    
      
        
        

      

      
        B-3Exibit 4.2 - Certificate of Claude LeBlanc pursuant to authority vested by
      the Subcommittee of the Finance and Risk Oversight Committee

    EXHIBIT
      4.2

    

    SECURITY
      CAPITAL ASSURANCE LTD

    Certificate
      of Claude LeBlanc

    pursuant
      to authority vested by the Subcommittee of the Finance and Risk
      Oversight

     Committee;
      which Subcommittee has been established pursuant to meetings of the

    Board
      of
      Directors held on February 27, 2007 and the meetings of

    the
      Finance and Risk Oversight Committee held on March 23, 2007

     

    WHEREAS,
      at a meeting held on February 27, 2007, the Board of Directors (the “Board of
      Directors”) of Security Capital Assurance Ltd (the “Company”) resolved that the
      Company may issue and sell (the “Issuance”), at any time or from time to time,
      up to US$350 million of long-term debt and/or preference securities and
      delegated to the Finance and Risk Oversight Committee of the Board of Directors
      (the “FROC”) and/or any subcommittee thereof appointed thereby, either of which
      committees or subcommittees being given full power to sub-delegate to a
      subcommittee appointed thereby, the right and power to determine all of the
      terms and conditions of each and any such Issuance (including, without
      limitation, the terms and conditions of any such securities, the manner of
      issuance and sale thereof, all pricing and pricing-related terms, and whether
      or
      not any replacement capital covenant ought to be provided for rating agency
      and/or similar purposes, and to execute under hand or seal any other documents,
      agreements, contracts, instruments and certificates to which the Company is
      a
      party or is affected, and considered to be necessary, desirable or advisable
      to
      in connection with any such Issuance).

     

    WHEREAS,
      at a meeting of the FROC held on March 23, 2007 the FROC approved certain
      transactions and documents generally and delegated to a subcommittee (the
“Subcommittee”) consisting of Paul S Giordano, Michael P. Esposito and Robert M.
      Lichten the full right and power to determine all of the terms and conditions
      of
      each and any such issuance. 

     

    WHEREAS,
      at a meeting of the Subcommittee held on March 29, 2007 the Subcommittee
      delegated to either Paul Giordano or Claude LeBlanc, each with the authority
      to
      act individually, the authority to determine the liquidation preference of
      the
      Company’s Fixed/Floating Series A Perpetual Non-Cumulative Preference Shares
      (the “Preference Shares”) of either US$25 or US$1,000 per share.

    

    WHEREAS,
      the undersigned has determined it is in the best interests of the Company that
      the Preference Shares be issued with a liquidation of US$1,000 per
      share.

    

    NOW
      THEREFORE, after full and careful consideration of the legal, commercial and
      financial consequences, direct and indirect, of the determination as to
      liquidation preference of the Preference Shares, I, Claude LeBlanc, on March
      29,
      2007, do hereby determine that the liquidation preference of the Preference
      Shares shall be US$1,000 per share.

    
      
         

      

      
         

        
        

      

      
         

      

    

    

    
      	 	
              SECURITY
                CAPITAL ASSURANCE LTD

               

            
	 	
              /s/
                Claude LeBlanc

            
	 	
              Name:

            	
              Claude
                LeBlanc

            
	 	
              Title

            	
              Executive
                Vice President, Corporate Development and
                Strategy

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