OVERSEAS PARTNERS LTD, DEF 14A, 2000-07-07

OVERSEAS PARTNERS LTD
DEF 14A, 2000-07-07
TRUCKING & COURIER SERVICES (NO AIR)

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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

SCHEDULE 14A

Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934 (Amendment No. )

Filed by the Registrant [X]

Filed by a Party other than the Registrant [_]

Check the appropriate box:

[_] Preliminary Proxy Statement

[_] CONFIDENTIAL, FOR USE OF THE
COMMISSION ONLY (AS PERMITTED BY
RULE 14A-6(E)(2))

[X] Definitive Proxy Statement

[_] Definitive Additional Materials

[_] Soliciting Material Pursuant to (S) 240.14a-11(c) or (S) 240.14a-12

Overseas Partners, Ltd.
--------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)

--------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)

Payment of Filing Fee (Check the appropriate box):

[X] No fee required.

[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.

(1) Title of each class of securities to which transaction applies:

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

(2) Aggregate number of securities to which transaction applies:

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

(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which
the filing fee is calculated and state how it was determined):

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

(4) Proposed maximum aggregate value of transaction:

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

(5) Total fee paid:

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

[_] Fee paid previously with preliminary materials.

[_] Check box if any part of the fee is offset as provided by Exchange
Act Rule 0-11(a)(2) and identify the filing for which the offsetting fee
was paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.

(1) Amount Previously Paid:

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

(2) Form, Schedule or Registration Statement No.:

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

(3) Filing Party:

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

(4) Date Filed:

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Notes:

Reg. (S) 240.14a-101.

SEC 1913 (3-99)

<PAGE>

OVERSEAS PARTNERS LTD.

Mintflower Place
8 Par-la-Ville Road
Hamilton HM GX, Bermuda

NOTICE OF ANNUAL MEETING OF SHAREOWNERS
August 9, 2000

To Our Shareowners:

The Annual General Meeting of Shareowners of Overseas Partners Ltd. ("OPL"
or the "Company"), a Bermuda company, will be held at the Company's offices at
Mintflower Place, 8 Par-la-Ville Road, Hamilton, Bermuda, on August 9, 2000 at
9:00 A.M., for the following purposes:

1. To elect members of the Board of Directors to serve until the next
Annual General Meeting of shareowners, and to leave one board
position vacant until it is filled by such person, at such time, as
the Board of Directors determines appropriate;

2. To confirm the appointment of Deloitte & Touche, Chartered
Accountants, as independent auditors of OPL for the year ending
December 31, 2000;

3. To approve the adoption of the Overseas Partners Ltd. Incentive
Compensation Plan (the "Incentive Plan") to permit the grant of
Nonqualified Stock Options, Incentive Stock Options, Stock
Appreciation Rights, Restricted Stock, Performance Shares,
Performance Units and Employee Stock Purchase Rights;

4. To approve an amendment to OPL's Memorandum of Association to
increase the Company's minimum share capital from $120,000 to
$370,000; and

5. To transact such other business as may properly come before the
meeting.

The Board of Directors has fixed the close of business on May 30, 2000, as
the record date for the determination of shareowners entitled to notice of,
and to vote at, the meeting.

By order of the Board of Directors.

Mark R. Bridges
Assistant Secretary

Hamilton, Bermuda
July 7, 2000

IN ORDER THAT YOUR SHARES MAY BE REPRESENTED AT THE MEETING, KINDLY SIGN AND
RETURN THE ENCLOSED PROXY AS PROMPTLY AS POSSIBLE IN THE ENCLOSED STAMPED
ENVELOPE. IF YOUR SHARES ARE HELD IN CUSTODY BY FIRST UNION NATIONAL BANK,
KINDLY SIGN AND RETURN THE ENCLOSED LETTER OF INSTRUCTION, OR FOLLOW THE
DIRECTIONS IN THIS DOCUMENT FOR OBTAINING A PROXY, TO ASSURE THAT YOUR SHARES
ARE VOTED IN ACCORDANCE WITH YOUR INSTRUCTIONS.
<PAGE>

OVERSEAS PARTNERS LTD.

Mintflower Place
8 Par-la-Ville Road July 7, 2000
Hamilton HM GX, Bermuda

PROXY STATEMENT

The accompanying proxy is solicited by the Board of Directors (the "Board")
of Overseas Partners Ltd., a Bermuda company ("OPL" or the "Company"), for the
Annual General Meeting of Shareowners to be held on August 9, 2000 (the
"Meeting"). The proxy and proxy statement are being mailed to shareowners on
or about July 7, 2000. In addition to solicitation by mail, proxies may be
personally solicited at the direction of OPL's officers. The expense of proxy
solicitation will be paid by OPL.

Only shareowners of record at the close of business on May 30, 2000 will be
entitled to vote at the Meeting. At the close of business on May 30, 2000, OPL
had 127,500,000 shares of Common Stock, $0.10 par value ("Common Stock"),
outstanding and entitled to vote at the Meeting. Holders of Common Stock are
entitled to one vote per share on all matters voted on by shareowners, except
that under OPL's Bye-laws, the voting rights of any shareowner (other than
certain shareowners set forth in OPL's Bye-laws) who beneficially own more
than 10 percent of the voting stock would be scaled back so that such
shareowner would only be entitled to cast one one-hundredth of a vote with
respect to each share owned in excess of 10 percent. No dissenters' rights are
applicable to the matters being voted upon.

It is intended that all shares of Common Stock represented by properly
executed proxies, unless otherwise specified on the proxy, will be voted FOR
the election of the persons nominated by the Board to be directors, FOR the
appointment of Deloitte & Touche as independent auditors, FOR adoption of the
Incentive Plan, and FOR the amendment to our Memorandum of Association. A
shareowner has the right to revoke his or her proxy by sending written notice
of revocation to the Secretary of OPL, provided the notice is received by the
Company no later than August 7, 2000, or by submitting a subsequent proxy that
is received by the Company no later than August 7, 2000, or by voting in
person at the Meeting.

Saul & Co., nominee for First Union National Bank ("First Union"), P.O. Box
41784, Philadelphia, PA 19101-1784 is the record owner of 98,406,755 shares,
constituting 77.2% of OPL's outstanding Common Stock as of May 30, 2000. These
shares are held by First Union as custodian for shareowners who have elected
not to have their shares distributed to them. First Union will forward this
notice of meeting and proxy statement to these beneficial owners.

Owners of Common Stock held by First Union as custodian may direct the
voting of their shares by executing and returning to First Union before August
2, 2000, the Letter of Instruction that they receive along with this notice of
meeting and proxy statement. If a shareowner wishes to personally execute a
proxy, he or she may request that First Union forward a proxy to them. This
request must be received by First Union prior to August 2, 2000. Shares for
which no instructions or requests for proxies are timely received will be
voted by First Union. First Union has advised OPL that it intends to vote such
shares FOR the election of the persons nominated by the Board to be directors,
FOR the appointment of Deloitte & Touche as independent auditors, FOR the
adoption of the Incentive Plan, and FOR the amendment to our Memorandum of
Association.

As used in this Proxy Statement, "dollars" and "$" refer to United States
dollars.
<PAGE>

ELECTION OF DIRECTORS
(Proposal No. 1)

Nominees For Election as Directors

A Board of five directors will be elected at the Meeting. All of the current
directors have been nominated for re-election by the Board, except for Messrs.
Reitman and Scott, who have decided not to stand for re-election. The
directors propose leaving one Board position vacant until the Board of
Directors appoints a qualified person to fill the vacancy, or proxies are
voted for the election of a nominee at the Meeting in accordance with OPL's
Bye-laws. The directors elected at the Meeting will serve until the next
Annual General Meeting and until the election and qualification of their
successors, or until their appointment is terminated in accordance with OPL's
Bye-laws.

The Board has no reason to anticipate that any nominee will decline or be
unable to serve. In case any nominee does decline or is unable to serve,
proxies may be voted for the election of a substitute nominee or the Board may
elect to reduce the number of directors to be elected at the Meeting and to
fill any resulting vacancies on the Board subsequent to the Meeting. Under
Bermuda law, a quorum of directors must ordinarily be resident in Bermuda. OPL
Bye-laws provide that two directors shall constitute a quorum.

Set forth below is certain biographical information concerning each of the
nominees for election as director.
-------------------------------------------------------------------------------

Robert J. Clanin Age 56 Director since 1994

Prior to becoming a director, Mr. Clanin served as Vice
President of OPL from June 1990 to August 1994. He has been
Senior Vice President, Treasurer and Chief Financial Officer
of United Parcel Service of America, Inc. ("UPS") since 1994.
Mr. Clanin is a member of the UPS Management Committee, which
oversees the day-to-day management of UPS. In 1996, he was
elected to the UPS Board of Directors.
[PICTURE OF ROBERT J. CLANIN APPEARS HERE]
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D. Scott Davis Age 48 Director since 1999

Mr. Davis served as President and Chief Executive Officer
of OPL from January 7, 1999 until his resignation on January
4, 2000 and March 30, 2000, respectively. After his
resignation as CEO, Mr. Davis accepted a position with UPS.
From May 1985 until January 1999, he served as Vice
President -- Finance and Accounting for UPS, where his
responsibilities for several years included banking,
investments, financial reporting and shareowner relations.
Prior to joining UPS, Mr. Davis was Chief Financial Officer
and then Chief Executive Officer of II Morrow, Inc., a
technology company based in Salem, Oregon that was acquired
by UPS in 1986.
[PICTURE OF D. SCOTT DAVIS APPEARS HERE]
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2
<PAGE>

Mary R. Hennessy Age 48 Nominee Director

Ms. Hennessy was elected President and Chief Operating
Officer of OPL on January 4, 2000 and Chief Executive Officer
on April 1, 2000. Prior to her appointment at OPL,
Ms. Hennessy held positions at TIG Holdings, Inc. from 1996
to 1999, first as Executive Vice President and Chief
Underwriting Officer and later as President and Chief
Operating Officer. From 1988 to 1996, she served as President
of Am-Re Services, Inc., Chairman and Chief Executive Officer
of Am-Re Consultants, Inc. and Senior Vice President and
Chief Actuary of American Re-Insurance Company. She is also a
director of Annuity and Life Re Holdings Ltd., an insurer
based in Bermuda.
[PICTURE OF Mary R. Hennessy]
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Joseph M. Pyne Age 52 Director since 1995

Mr. Pyne has served as Senior Vice President of Marketing
and Corporate Development for UPS since 1996. In this
capacity, he directs UPS's worldwide marketing, electronic
commerce, advertising, public relations, the UPS Logistics
Group, UPS Capital Corporation and other UPS subsidiaries
that enable global commerce. He began his UPS career in 1969
and was promoted to North Central Region Business Development
Manager in 1984. In 1989 he became National Marketing
Planning Manager, and also headed Marketing for the U.S.
ground and air delivery services.
[PICTURE OF JOSEPH M. PYNE]
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Cyril E. Rance Age 66 Director since 1995

Mr. Rance was President and Chief Executive Officer of a
large Bermuda insurer until his retirement in 1990. He has
more than 40 years experience in all aspects of the insurance
industry. He also has had a long and varied career in civic
and government service, including 10 years as a member of the
Bermuda Parliament. He is a director of XL Capital Ltd., an
insurance holding company, and of several international
companies registered in Bermuda.
[PICTURE OF CYRIL E. RANCE APPEARS HERE]
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The Board of Directors Recommends That Shareowners Vote FOR
the Election of The Nominees Named Above and FOR Leaving One Board
Position Vacant Until it is Filled by such Person, at such Time, as the Board
of Directors Determines Appropriate.

3
<PAGE>

Stock Ownership of Certain Beneficial Owners and Management

Set forth below is information relating to the beneficial ownership of OPL
Common Stock by (i) each director or director nominee, (ii) the Chief
Executive Officer and each of the Company's four highest paid executive
officers during 1999 (the "Named Executive Officers"), and (iii) all directors
and executive officers as a group. All shares are owned of record and
beneficially, and each person and group identified has sole voting and
investment power with respect to such shares, except as otherwise indicated.

No individual or group known to the Company beneficially owns more than five
percent of the outstanding shares of the Company.

4
<PAGE>

<TABLE>
<CAPTION>
Common Stock Held as of May 30, 2000(1)
----------------------------------------------------
Additional Shares in
which the Director or
Nominee has, or
Shares Participates in the
Beneficially Voting or Investment Total Shares and
Name Owned(2) Power(3) Percent of Class
---- ------------ --------------------- -----------------
<S> <C> <C> <C>
Joseph M. Pyne
55 Glenlake Parkway, NE
Atlanta, GA 30328........ 22,613 -- 22,613 (0.02%)
Cyril E. Rance
Blue Anchorage
No. 6 Agars Hill-Point
Shares
Pembroke HM 05, Bermuda.. 2,000 -- 2,000 (0.00%)
Edwin H. Reitman
1050 Mitchell Hill Court
Greensboro, GA 30642..... 40,847 -- 40,847 (0.03%)
Leopold A. Schmidt
103 Quill Place
Williamsburg, VA 23185... 36,948 -- 36,948 (0.03%)
Walter A. Scott
c/o Tempest Re
14 Par-la-Ville Road
Hamilton HM 08, Bermuda.. 2,000 -- 2,000 (0.00%)
All directors and
executive officers as a
group
(8 persons)(4)........... 144,808 5,658,232 5,803,040 (4.69%)
</TABLE>
-----------
(1) These holdings are reported in accordance with regulations of the
Securities and Exchange Commission (SEC) that require the disclosure of
shares to which directors and officers hold voting or disposition power,
notwithstanding the fact that they are held in a fiduciary, rather than a
personal, capacity and that the power is shared among a number of
fiduciaries including, in several cases, corporate trustees, directors or
other persons who are neither officers nor directors of OPL.
(2) The amounts shown in this column include 24,423 shares owned by or held in
trust for members of the families of Messrs. Butler, Clanin, and Schmidt
as to which they disclaim beneficial ownership.
(3) None of the directors, nominees, other officers, nor members of their
families, has any ownership rights in the shares listed in this column.
Of the shares listed (a) 5,321,070 shares are owned by a charitable
foundation on whose Board of Trustees Mr. Clanin and other persons serve
and (b) 337,162 shares are held by a charitable foundation of which Mr.
Clanin and other persons are trustees.
(4) This is the total owned by all current directors and officers, as of May
30, 2000. Mr. Butler and Mr. Schmidt have been excluded from the total as
Mr. Butler retired from the Company on December 16, 1999 and Mr. Schmidt
from the Company on May 31, 1999.

Meetings of the Board of Directors

The OPL Board of Directors held five meetings during 1999. Each director
attended all of the meetings of the Board of Directors and of the Board
Committees on which they served during 1999.

5
<PAGE>

Committees of the Board of Directors

The OPL Board of Directors has an Executive Committee, an Audit Committee, a
Compensation Committee, a Nominating Committee and an Underwriting Committee.

Messrs. Davis, Clanin and Reitman, with Mr. Clanin as Chairman, constitute
the Executive Committee of the Board. This Committee has been authorized by
OPL's Board of Directors to exercise all of the powers of the Board except
those acts that by law must be performed by the Board itself. The Executive
Committee did not hold any meetings in 1999.

Messrs. Pyne, Clanin and Rance, with Mr. Pyne as Chairman, constitute the
members of the Audit Committee. The Audit Committee meets periodically with
management, independent auditors, appropriate financial personnel and internal
auditors to consider the adequacy of the internal controls and the objectivity
of financial reporting. Both the internal auditors and the independent
auditors have unrestricted access to the Audit Committee. During 1999, the
Chief Executive Officer periodically sat as an ex officio member of this
Committee but did not participate in discussions on audit matters or in
private sessions with internal or external audit personnel. The Audit
Committee recommends to the Board the appointment of the independent auditors.
The Audit Committee met twice in 1999.

Messrs. Clanin, Reitman and Scott, with Mr. Clanin as Chairman, constitute
the members of the Compensation Committee. The Compensation Committee is
responsible: (i) for recommending to the Board of Directors the appropriate
compensation of outside directors; (ii) for determining the compensation of
the Chief Executive Officer; and (iii) for approving the compensation of the
other officers of OPL and its subsidiaries upon the recommendation of the
Chief Executive Officer. The Compensation Committee met once in 1999.

Messrs. Clanin, Reitman and Scott, with Mr. Reitman as Chairman, constitute
the members of the Nominating Committee. This Committee is responsible for
recommending director nominees to the Board of Directors and will consider
nominees recommended by shareowners. Shareowners may submit their
recommendations in writing to the attention of the Secretary of OPL. The
Committee will consider nominations for the 2001 Annual General Meeting (the
"2001 Meeting") if they are received by OPL not more than 60 days and not less
than 30 days in advance of the 2001 Meeting. However, in the event that the
Company gives shareowners less than 40 days' notice of the date of the 2001
Meeting, nominations by a shareowner, to be timely, must be received not later
than the close of business on the tenth day following the date that notice of
the 2001 Meeting was mailed, or public disclosure was made, whichever occurs
first. The Nominating Committee met once in 1999.

The Underwriting Committee performs an oversight role of the Company's
underwriting activities. It assists in the development of underwriting
standards and helps identify lines of reinsurance that may be appropriate for
the Company. The Committee reviews new and renewing reinsurance programs as
well as the financial performance of existing programs. The members of the
Committee are Messrs. Davis, Rance and Scott, with Mr. Davis as Chairman. The
Underwriting Committee met four times in 1999.

COMPENSATION OF DIRECTORS

Directors who are employees of OPL receive no additional compensation for
their service as directors or as members of Committees appointed by the Board
of Directors. Other directors receive an annual fee of $40,000. Members of the
Audit, Compensation, Nominating and Underwriting Committees, who are not
employees of OPL, receive an additional fee of $1,250 for each Committee
meeting they attend.

6
<PAGE>

COMPENSATION OF EXECUTIVE OFFICERS AND OTHER INFORMATION

Report of the Compensation Committee on Executive Compensation

The Compensation Committee of the Board of Directors has provided the
following report on Executive Compensation:

The Compensation Committee of the Board of Directors has responsibility for
determining the compensation of the Chief Executive Officer (CEO) and for
approving the compensation of the other officers of OPL and its subsidiaries
upon the recommendation of the CEO. Overall compensation currently includes
salary, bonus, and Stock Appreciation Rights. The Committee also determines
cost of living allowances to be paid to executive officers residing in
Bermuda. The Committee is assisted in carrying out its responsibility by OPL
management and by outside consultants.

In determining appropriate compensation levels, the Committee reviews data
for comparable positions at reinsurance and real estate investment companies
in Bermuda and the United States. According to data received, the 1999
compensation of OPL's executive officers was less than the median compensation
levels of the companies studied. (The Companies studied were not limited to
those in the Standard & Poor's 500 Index and the Standard & Poor's Multi-Line
Insurance Companies Index used in the performance graph following this
report.)

Currently, all elements of the compensation package are payable in cash. In
determining the salaries and bonuses of the CEO and other executive officers,
the Committee does not employ formulas but instead exercises its judgment
based on considerations including overall responsibilities, experience and
ability, ability to work with others, performance against budget, prior year
compensation and the compensation programs of the particular officer's
previous employer.

Stock Appreciation Rights ("SARs") granted under the Stock Appreciation
Rights Plan are long-term awards intended to promote growth in shareowner
value and continuity of employment. The number of SARs granted to a particular
employee is determined by a formula based on the salary of the recipient at
the time of grant. The amount received upon exercise of the award depends on
the performance of OPL Common Stock over the period between the date of grant
and the date of exercise.

Cost of living allowances are intended to permit executive officers to
maintain a standard of living comparable to that enjoyed in the United States.

The Compensation Committee

Robert J. Clanin, Chairman
Edwin H. Reitman
Walter A. Scott

7
<PAGE>

Summary Compensation Table

The following table shows the cash compensation paid or to be paid by OPL or
its subsidiaries, as well as certain other compensation paid in 1999, 1998,
and 1997 to the following Named Executive Officers in all capacities in which
they served:

<TABLE>
<CAPTION>
Annual Compensation
-----------------------------------------------------
Long-term
Compensation
------------
Stock
Name and Principal Other Annual Appreciation
Position Year Salary Bonus(5) Compensation (6) Rights (7)
------------------ ---- -------- -------- ---------------- ------------
<S> <C> <C> <C> <C> <C>
D. Scott Davis.......... 1999 $225,500 $112,680 $ 96,000 13,480
President and Chief 1998 $ -- $ -- $ -- --
Executive Officer(1) 1997 $ -- $ -- $ -- --
Mark R. Bridges......... 1999 $171,875 $176,135 $135,000 7,021
Vice President and 1998 $104,000 $ -- $ 84,375 --
Treasurer(2) 1997 $ -- $ -- $ -- --
Thomas E. Butler........ 1999 $145,000 $171,449 $160,557 5,923
Vice President and 1998 $132,500 $ 35,586 $153,702 5,474
Secretary 1997 $126,250 $ 40,512 $132,851 3,832
Michael J. Molletta..... 1999 $137,500 $121,986 $ -- 5,617
President of Overseas 1998 $126,250 $ 29,160 $ -- 4,013
Management, Inc. 1997 $112,500 $ 34,604 $ -- 2,561
Leopold A. Schmidt...... 1999 $ 84,000 $ 78,075 $ 78,182 7,149
Vice President(4) 1998 $142,500 $ 37,098 $151,260 5,888
1997 $131,250 $ 37,980 $165,675 3,983
</TABLE>
-----------
(1) Mr. Davis was appointed President and Chief Executive Officer on January
7, 1999 and resigned on January 4, 2000 and March 30, 2000, respectively.
(2) Mr. Bridges commenced employment with OPL in May 1998.
(3) Mr. Butler retired on December 16, 1999.
(4) Mr. Schmidt retired on May 31, 1999.
(5) Bonus includes the 1998 bonus paid on January 19, 1999 and the 1999 bonus
paid on November 23, 1999.
(6) Other annual compensation consists of cost of living allowances, and for
Messrs. Butler, and Schmidt, reimbursement of additional U.S. income
taxes paid as a result of the foreign assignment. These allowances are
intended to permit such executives to maintain comparable living
standards. Mr. Schmidt became a Bermuda resident in November of 1996. Mr.
Butler became a Bermuda resident in January 1997. Mr. Davis became a
Bermuda resident in January 1999.
(7) Number of shares underlying the Stock Appreciation Rights granted.

8
<PAGE>

Stock Appreciation Rights -- Grants

The following table sets forth information concerning grants of Stock
Appreciation Rights to the Named Executive Officers in 1999:

<TABLE>
<CAPTION>
Potential Realizable
Value at
Assumed Annual Rates
of OPL Stock
% of Total Appreciation
Rights For Rights Term(3)
Rights Granted to Appreciation Expiration --------------------
Name Granted Employees Base(1) Date(2) 5% 10%
---- ------- ---------- ------------ ---------- --------- ----------
<S> <C> <C> <C> <C> <C> <C>
Mark R. Bridges......... 7,021 7.9% $19.84 03/31/04 $ 38,485 $ 85,042
Thomas E. Butler........ 5,923 6.6% $19.84 03/31/04 $ 32,466 $ 71,742
D. Scott Davis.......... 13,480 15.1% $19.84 03/31/04 $ 73,890 $ 163,277
Michael J. Molletta..... 5,617 6.3% $19.84 03/31/04 $ 30,789 $ 68,036
Leopold A. Schmidt...... 7,149 8.0% $19.84 03/31/04 $ 39,187 $ 86,592
</TABLE>
-----------
(1) Represents the price of OPL Common Stock on the date of grant.
(2) Generally, rights may not be exercised until the expiration of five years
from the date of grant, and then only during a 30-day period following
the mailing date of OPL's Annual Report on Form 10-K for the prior year.
(3) Based on actual term of the SARs and annual compounding. The dollar
amounts in these columns are the result of calculations at the assumed
appreciation rates set by the Securities and Exchange Commission and are
not intended to forecast future appreciation of shares of Common Stock.

The following table sets forth information concerning Stock Appreciation
Rights exercised in 1999 by the Named Executive Officers and the value of
their unexercised Stock Appreciation Rights on December 31, 1999.

<TABLE>
<CAPTION>
Aggregated Stock Appreciation Rights Exercised in 1999 and Year-End Rights
Value
--------------------------------------------------------------------------
Number of
Shares Value Number of Unexercised Value of Unexercised
Underlying Realized Rights at 12/31/99 Rights at 12/31/99
Rights Upon ------------------------- ----------------------------
Name Exercised Exercise Exercisable Unexercisable Exercisable Unexercisable(1)
---- ---------- -------- ----------- ------------- ----------- ----------------
<S> <C> <C> <C> <C> <C> <C>
Mark R. Bridges......... -- $ -- -- 7,021 $-- $ 11,655
Thomas E. Butler........ 4,224 $46,633 -- 22,432 $-- $148,474
D. Scott Davis.......... -- $ -- -- 13,480 $-- $ 22,377
Michael J. Molletta..... 1,797 $19,839 -- 17,352 $-- $100,517
Leopold A. Schmidt...... 2,570 $28,373 -- 24,182 $-- $143,217
</TABLE>
-----------
(1) Based on fair value per share of OPL Common Stock as of December 31, 1999
minus exercise price.

9
<PAGE>

Retirement Plans

The following table shows the estimated annual retirement benefit payable
under OPL's Retirement Plan and Coordinating Benefit Plan (the "Plans") at age
65 on a single life only annuity basis to participating employees
("Participants"), including the Named Executive Officers, who are also
entitled to receive $16,440 per year (maximum currently payable) in primary
Social Security benefits:

Pension Plan Table

<TABLE>
<CAPTION>
Estimated Annual Retirement Benefits (as of
12/31/99)
For Years of Service(1)(2)(3)(4)
Average -----------------------------------------------------------------------
Remuneration 15 Years 20 Years 25 Years 30 Years
------------ -------- -------- -------- ---------
<S> <C> <C> <C> <C>
$125,000 $ 27,141 $ 36,188 $ 45,234 $ 54,281
$150,000 $ 33,391 $ 44,521 $ 55,651 $ 66,782
$175,000 $ 39,641 $ 52,855 $ 66,068 $ 79,282
$200,000 $ 45,981 $ 61,188 $ 76,485 $ 91,782
$225,000 $ 52,141 $ 69,522 $ 86,902 $104,282
$250,000 $ 58,391 $ 77,855 $ 97,319 $116,783
$300,000 $ 70,982 $ 94,522 $118,153 $141,783
$400,000 $ 95,892 $127,856 $159,820 $191,784
$450,000 $108,392 $144,523 $180,654 $216,785
$500,000 $120,893 $161,190 $201,488 $241,785
</TABLE>
-----------
(1) Under the OPL Retirement Plan, Participants receive credit for prior
service with UPS. In the case of Participants with UPS deferred vested
benefits, OPL is responsible for the difference between the amounts shown
above and the amounts such Participants receive from UPS at retirement.
(2) Amounts exceeding $130,000 would be paid pursuant to Overseas Partners
Capital Corp.'s Coordinating Benefit Plan.
(3) For 1999, no more than $160,000 (which is adjusted from time to time by
the Internal Revenue Service) of cash compensation could be taken into
account in calculating benefits payable under the OPL Retirement Plan.
(4) Participants who elect payment forms with survivor options will receive
lesser monthly amounts than those shown in the table.

The compensation covered by the Plans includes salary plus bonus. The
covered compensation for each Participant in the Plans is the average covered
compensation of the Participant during the five highest consecutive years out
of the last ten full calendar years of service.

Estimated or actual credited years of service under the Plans to the Named
Executive Officers was as follows: Butler -- 30 years, Molletta -- 22 years
and Schmidt -- 30 years.

The Plans permit Participants with 25 or more years of service to retire as
early as age 55 with no or only a limited reduction in the amount of their
monthly benefits.

10
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Compensation Committee Interlocks and Insider Participation

Two members of the Compensation Committee of the Board of Directors of OPL
were officers of OPL prior to 1999. Robert J. Clanin served as Vice President
of OPL from 1990 until 1994, and Edwin H. Reitman served as President and
Chief Executive Officer of OPL from 1991 until 1995.

Performance Graph

The following graph shows a five year comparison of cumulative total
shareowner returns for OPL, the Standard & Poor's 500 Index (the S&P 500) and
the Standard & Poor's Multi-Line Insurance Companies Index (the S&P Multi-
Line). The comparison of the cumulative total returns on investment (change in
annual stock price plus reinvested dividends) for each of the annual periods
assumes that $100 was invested on December 31, 1994 in each of OPL's Common
Stock, the S&P 500 and the S&P Multi-Line.

[LOGO]

Comparison of Five-Year Cumulative Total Returns
(OPL, S&P 500, S&P Multi-Line)

Dec-95 Dec-96 Dec-97 Dec-98 Dec-99
S&P Multi-Line 146.66 175.34 271.36 302.55 397.20
S&P 500 137.11 164.53 214.68 271.18 323.55
OPL 127.53 151.42 181.17 211.34 229.76

OPL Common Stock is not listed on a securities exchange or traded in the
over-the-counter market. Prior to November 23, 1999, the current price of OPL
Common Stock was equal to the book value of OPL Common Stock on December 31 of
the prior year as reported in OPL's Annual Report to Shareowners. The current
price is now determined by the Board semiannually in February and August of
each year.

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CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Common Relationships with UPS

OPL was organized under Bermuda law in June of 1983 by UPS. On December 31,
1983, prior to commencing operations, OPL was spun off when UPS paid a special
dividend to shareowners of one share of OPL Common Stock for each share of UPS
Common Stock outstanding as of November 18, 1983, resulting in the
distribution of approximately 97% of OPL's outstanding Common Stock.

OPL was organized to reinsure shipper's risks relating to packages carried
by subsidiaries of UPS as a common carrier, as well as write reinsurance for
insureds unaffiliated with UPS. Since commencing operations on January 1,
1984, OPL's primary business was reinsuring the risk of loss or damage to
shippers' packages whose declared value exceeded $100 (or equivalent in
foreign currency). This reinsurance did not involve transactions conducted
between UPS and OPL, rather, various subsidiaries of American International
Group, Inc. ("AIG"), (an insurance company unaffiliated with OPL or UPS)
insured customer packages carried by UPS's subsidiaries (and unaffiliated
carriers), in return for premiums paid by the customers. OPL reinsured AIG,
and the premium it received from AIG constituted OPL's largest source of
revenues and profits. Reinsurance premiums earned by OPL for reinsuring these
risks from January 1, 1999 to December 31, 1999 were $273.5 million or 19.5%
of OPL's 1999 revenues, a reduction from 29.4% in 1998.

On August 9, 1999, a judge of the United States Tax Court issued an opinion
in United Parcel Service of America, Inc. v. Commissioner of Internal Revenue.
OPL was not a party to the action and was not directly affected by this
decision. However, the opinion concerns the taxation of premiums paid for
shipper's risk insurance that was reinsured by OPL. On August 31, 1999, AIG
notified OPL that UPS intended to provide shipper's risk reinsurance for its
customers through a UPS subsidiary effective October 1, 1999. This means that
OPL will not provide shipper's risk reinsurance in the future.

OPL's reinsurance business also includes reinsurance of workers'
compensation insurance issued by another unaffiliated United States-based
insurance company covering risks of a UPS subsidiary in California.

Two members of OPL's Board of Directors served as officers of UPS during
1999. Mr. Robert J. Clanin has served as Vice President, Treasurer and Chief
Financial Officer of UPS since 1994 and Mr. Joseph M. Pyne serves as Senior
Vice President -- Corporate Marketing of UPS. In considering which UPS risks
to reinsure, the directors of OPL, who are also officers and shareowners of
UPS, must consider the impact of their business decisions on each of the two
companies. Although prevailing market conditions are among the factors
considered by them in making such decisions, there can be no assurance that
transactions relating to the two companies will be on the most favorable terms
that could be obtained by either party in the open market. OPL does not have
any formal conflict resolution procedures.

OPL's business includes leasing real estate to subsidiaries of UPS through
Overseas Capital Co. ("OCC"). OCC is a wholly owned subsidiary of OPL and OPL
has guaranteed OCC's performance under the leasing arrangements described
below. In December 1989, OCC acquired the Ramapo Ridge facility from UPS. In
July 1990, the Facility was leased back to UPS for an initial term ending in
2019. UPS uses the Facility as a data processing, telecommunications and
operations center. The lease payments have both a fixed and variable
component. The fixed component provides for a total payment of approximately
$216 million over the initial term of the lease. The variable component of the
payment is based on the number of customer accounts maintained by UPS.

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<PAGE>

OCC has irrevocably assigned the right to receive the fixed component of the
rentals to its subsidiary, OPL Funding Corp. ("OPL Funding"), a Delaware
corporation. OPL Funding, in turn, has pledged its right to receive these
payments to another entity as security for bonds issued to finance the
acquisition of the leased assets. UPS's obligation to pay the fixed rentals to
OPL Funding is absolute and unconditional during the initial term of the
lease, and continues after an early lease termination unless UPS pays to OPL
Funding an amount sufficient to pay the remaining interest on the bonds. In
the event that OCC fails to pay certain income taxes, UPS is obligated to pay
additional rentals to provide for such taxes. OCC is required to reimburse UPS
the amount of any such termination or tax payments.

In 2050, at the conclusion of the lease, UPS has an option to purchase the
buildings on which the Facility is located, but not the land, from OCC. The
purchase price has been set at $63.7 million, subject to adjustments for
increases in the fair market value of the land. In 1999, OCC received rental
payments of approximately $17.3 million in the aggregate from UPS under to the
lease described above.

Other Transactions

Mr. Leopold A. Schmidt retired as an officer of OPL in May 1999, however, he
continued to provide reinsurance consulting services to OPL from June 1999 to
December 1999.

SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE

Based solely on the review of the forms required by Section 16(a) of the
Securities Exchange Act of 1934 that have been filed, and written
representations that no other forms are required, OPL believes that all filing
requirements applicable to its officers and directors have been complied with.
There are no beneficial owners known to the Company that own more than 10%
percent of the outstanding shares of OPL's Common Stock.

APPOINTMENT OF INDEPENDENT PUBLIC ACCOUNTANTS
(Proposal No. 2)

The Board recommends, for appointment by the shareowners, Deloitte & Touche,
Chartered Accountants, as independent auditors, to audit the consolidated
financial statements of OPL for the year ending December 31, 2000 and to
prepare a report on such audit. A representative of Deloitte & Touche will not
be present at the Annual General Meeting, but officers of OPL will be
available to respond to appropriate questions by shareowners.

The Board of Directors Recommends That Shareowners Vote FOR the Appointment of
Deloitte & Touche as Independent Auditors.

OVERSEAS PARTNERS LTD. INCENTIVE COMPENSATION PLAN
(Proposal No. 3)

The Board has adopted, and recommends that the shareowners approve, the
Overseas Partners Ltd. Incentive Compensation Plan (the "Plan"). Under the
Plan, current employees and directors of the Company and its subsidiaries or
affiliates, and certain other key persons would be eligible to receive options
to purchase shares of OPL Common Stock, as well as other awards. The Board is
soliciting your approval of the Plan in your capacity as a holder of OPL
Common Stock. In the absence of shareowner approval, the Plan will be without
effect, and no awards will be granted under the Plan.

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<PAGE>

The following summary describes all material elements of the Plan, but does
not purport to be complete and is subject to and qualified by reference to the
Plan. A copy of the Plan is attached to this proxy statement as Annex A.

General

Effective Date of the Plan. The Plan was effective on May 11, 2000.

Administration of the Plan. Generally, the Compensation Committee of the
Board will administer the Plan, however, the Board may take on the powers of
the Committee. Further, the Plan provides that if awards are intended to
comply with the provisions of Section 162(m) of the Internal Revenue Code (the
"Code"), the Committee must consist solely of two or more "outside directors,"
as defined by Section 162(m) of the Code. Except as limited by law or OPL's
Memorandum of Association or Bye-laws, the Committee will have full and final
authority to select the individuals who receive awards, as well as a wide
degree of flexibility in determining the terms and conditions of awards.

Eligibility Under the Plan. All employees and directors of OPL and its
subsidiaries or affiliates, as well as other key persons are eligible to
participate in the Plan (the "Participants"). We estimate that approximately
50 employees and 6 directors of OPL are currently eligible to participate in
the Plan. Because awards under the Plan are discretionary, we cannot presently
determine the amount or form of any award that will be allocated to any
individual during the term of the Plan.

Shares Subject to the Plan. The maximum number of shares of OPL Common Stock
that may be issued under the Plan is 5,000,000 shares. The Plan contains
customary anti-dilution provisions.

Types of Awards. The awards that may be granted under the Plan include:

. stock options (both incentive stock options and non-qualified stock
options, as discussed in greater detail below)

. restricted stock

. stock appreciation rights

. performance units

. performance shares

A participant may be granted one or more of these awards in tandem or in the
alternative.

Maximum Awards Issuable to Individuals. The Committee may not, within any
Plan Year (the period from March 1 to February 28 of the following year):

. grant options to purchase more than 150,000 shares of OPL Common Stock to
a Participant

. grant stock appreciation rights equivalent to more than 150,000 shares of
OPL Common Stock to a Participant

. grant awards of restricted stock in excess of 150,000 shares of OPL
Common Stock to a Participant

. grant awards of performance shares/units with a maximum aggregate payout
greater than the value of 150,000 shares of OPL Common Stock to a
Participant.

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<PAGE>

Options. The exercise price for options granted under the Plan may not be
less than 100% of the fair value of a share of OPL Common Stock on the date of
grant. The exercise price of an incentive stock option granted to a person who
owns more than 10% of the total combined voting power of all classes of common
stock of OPL may not be less than 110% of the fair market value of a share of
OPL Common Stock on the date of grant.

Employee Stock Purchase Rights. The Plan permits employees of OPL who have
been employed by OPL for at least six (6) months on the date on which their
subscriptions are accepted by OPL, to purchase shares of OPL. The following is
a summary of this section of the Plan:

. The purchase price for each share is equal to the fair value of a share
of OPL Common Stock on the date the subscription is accepted by OPL

. An employee may subscribe to purchase not less than 50 shares at any
time, nor more than 20,000 shares annually, by delivering a fully
executed subscription agreement, together with a check or money order in
the appropriate amount, to First Union, who is the transfer agent

. OPL reserves the right, in its sole discretion, to accept or reject any
subscription in part or in its entirety. Acceptance is non-revocable.

. As soon as practicable after OPL has accepted a subscription, OPL will
deliver to First Union the shares of OPL Common Stock, for the benefit of
the subscriber

. Employees who are subject to Section 16(b) of the Exchange Act may not
subscribe to shares of OPL Common Stock unless the Compensation Committee
approves their subscription.

Retirement, Death or Disability. In the event of retirement, death or
disability, any award held by a Participant will vest and any performance or
length of service-based restrictions on the award shall lapse. An Option or
SAR will be exercisable for the lesser of three (3) years or the original term
of the award, provided however that an incentive stock option must be
exercised within ninety (90) days in the event of retirement or one (1) year
in the event of disability. In the event of death of a Participant, any rights
under the Plan shall pass in accordance with the individual's will or by
applicable law. Upon the vesting of any performance-based restricted stock or
performance units or shares in the event of death or disability, the legal
representative of the Participant will be paid on a pro-rata basis.

Termination for Cause. In the event that a Participant is terminated for
cause prior to the vesting of any award, all such awards shall terminate
simultaneous with termination of employment. Awards that are fully vested must
be exercised within 30 days of termination.

Amendments to and Termination of the Plan. Subject to limitations imposed by
law and by the Plan, the Board may amend or terminate the Plan at any time,
provided however, that no amendment or termination may adversely affect, in
any material way, an award previously granted under the Plan without the
consent of the Participant holding the award.

Duration of the Plan and of Options. The Plan will remain in effect until
all shares allotted to the Plan have been purchased or acquired according to
the Plan's provisions, however, we may not grant awards under the Plan on or
after May 11, 2010, nor may we grant any option that is exercisable after the
10th anniversary of the date of grant.

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<PAGE>

Compliance with Section 16(b). Under Section 16(b) of the Exchange Act,
directors, executive officers and 10% shareowners of OPL will be liable to OPL
for repayment of any profits realized from any non-exempt purchase and sale of
OPL Common Stock occurring within a six-month period. Rule 16b-3 provides an
exemption from Section 16(b) liability for transactions by an officer or
director made with the approval by the board of directors, a committee
composed of outside directors, or shareowners. It is intended that all grants
made under the Plan would meet the requirements of the Rule 16b-3 exemption.

Change In Control

Treatment of Outstanding Awards. Upon the occurrence of a change in control
(as defined in the Plan), unless otherwise specifically prohibited by law or
the rules and regulations of any governmental agencies or national securities
exchanges, the following shall apply:

SARs. Any SARs granted under the Plan shall become immediately exercisable
for a period of 30 days and the Participant shall, upon exercise, be entitled
to receive the following:

If the change in control occurs later than one year following the date of
grant, an amount equal to (a) multiplied by (b) where (a) and (b) equal the
following (the "Defined Amount"):

(a) i.The fair value of a share on the date of exercise; less

ii.The grant price per share; plus

iii. Paid and declared dividends per share of common stock underlying
the SAR from the beginning of the grant date to the date the SAR is
exercised;

(b) The number of shares with respect to which the SAR is exercised.

If the change in control occurs within one year following the date of
grant, an amount equal to the greater of the Defined Amount or the Target
Award upon which the award was based, pro rated as to the time elapsed
prior to the change in control.

Restricted Stock and Performance Units/Shares. Restricted Stock and
Performance Units/Shares shall vest and the Participant shall be paid the
Target Award (as defined in the Plan) pro rated based on the time that has
elapsed from the date of grant to the date of the change in control.

Options. Any options shall become exercisable, and the Participant shall be
entitled to receive the number of shares specified as the Target Award, pro
rated based on the time that has elapsed from the date of grant to the date of
the change in control. The Participant has thirty (30) days following the
change in control to pay for the shares.

Termination, Amendment, and Modifications of Change-in-Control
Provisions. The change in control provisions of the Plan may not be
terminated, amended, or modified on or after the date of a change in control
to adversely affect any award granted prior to such change without the written
consent of the Participant; provided, however, that the Committee has retained
the power to amend the Plan in order to comply with changes in the Code, the
Exchange Act or other applicable law or stock exchange rule after the date of
a change in control.

Loss of Bermuda Work Permit

In the event that a Participant's Bermuda work permit is not extended by a
decision of the Bermuda Department of Immigration, the change in control
provisions above will apply to that Participant only.

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<PAGE>

Put Option

While employed by OPL, a Participant in the Plan shall have the right to
require OPL to purchase all or part of his or her shares of OPL Common Stock,
subject to the approval of the Committee.

If a Participant terminates his or her employment with OPL voluntarily or is
terminated without cause or because of a loss of a Bermuda work permit, the
Participant has forty-five (45) days to request that OPL purchase his or her
shares. Provided that the request is made within the required forty-five (45)
days, OPL is obligated to purchase the shares put to it. If a participant is
terminated for cause, the participant will not be permitted to exercise the
put right.

The purchase price shall equal the fair value of a share on the date of the
sale of the shares to OPL multiplied by the number of shares being purchased.

Limitations. A Participant may exercise his or her put rights only to the
extent that the sale and purchase is not prohibited by applicable law. The put
right shall be exercisable only by a Participant during his or her lifetime;
provided, however, that in the event the Participant is incapacitated and
unable to exercise his or her rights, the Participant's representative shall
be permitted to exercise the Participant's rights under the put option. In the
event of the death of a Participant, any put rights of a Participant shall
pass in accordance with the Participant's will or by applicable law. The put
right may not be exercised as to any shares that have been held by the
Participant for more than five (5) years.

Federal Income Tax Consequences for United States Citizens

The following is a brief description of the United States federal income tax
treatment that will generally apply to awards to U.S. citizens made under the
Plan, based on federal income tax laws in effect on the date of this proxy
statement. The exact federal income tax treatment of awards will depend on the
specific nature of any award.

Incentive Stock Options. Plan Participants who are employees may be granted
options that we intend to qualify as incentive stock options under Section 422
of the Code. Generally, the optionee is not taxed on the grant or exercise of
an incentive stock option. However, if the optionee sells the shares acquired
from the exercise of an incentive stock option at any time within: (a) one
year after the transfer of these shares to the optionee or (b) two years from
the date of grant of the incentive stock option, then the optionee will
recognize ordinary income in an amount equal to the excess, if any, of: the
lesser of the sale price or the fair market value of the shares on the date of
exercise, over the exercise price of the incentive stock option.

If the optionee sells the shares at any time after the optionee has held the
shares for at least: one year after the date of the transfer of the shares to
the optionee pursuant to the exercise of the incentive stock option and two
years from the date of grant of the incentive stock option, then the optionee
will recognize capital gain (or loss) equal to the difference between the sale
price and the exercise price of the incentive stock option.

The amount by which the fair market value of the shares received upon
exercise exceeds the exercise price will be included as a positive adjustment
in the calculation of an optionee's alternative minimum taxable income in the
year of exercise. The "alternative minimum tax" imposed on individual
taxpayers is generally equal to the amount by which 28% (26% of alternative
minimum taxable income below specified amounts) of the individual's
alternative maximum taxable income (reduced by specified exemption amounts)
exceeds his or her regular income tax liability for the year.

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<PAGE>

Non-Qualified Stock Options. The grant of an option to acquire stock that
does not qualify for treatment as an incentive stock option (which we call a
"non-qualified stock option") is generally not a taxable event for the
optionee until exercise. Upon exercise of the option, the optionee will
generally recognize ordinary income in an amount equal to the excess of the
fair market value of the shares acquired (determined as of the date of
exercise) over the exercise price of the option.

Upon the sale of shares acquired pursuant to the exercise of a non-qualified
stock option, the optionee will recognize capital gain (or loss) equal to the
difference between the sale price and the fair market value of the shares on
the date of exercise. This gain will be long-term capital gain (or loss) if
the shares have been held for more than one year after exercise.

Stock Appreciation Rights. At the time that Stock Appreciation Rights
("SARs") are granted, an SAR holder will recognize no taxable income. The SAR
holder will recognize taxable income at the time the SAR is exercised equal to
the amount of cash (based on the increase in the fair market value of the
shares) received upon such exercise. Any gain (or loss) upon the disposition
of the stock acquired pursuant to the exercise of an SAR will qualify as
short-term capital gain (or loss) depending on how long the SAR holder holds
the stock before disposition.

Restricted Stock. Awards under the Plan may include stock sales, stock
bonuses or other grants of stock that include provisions for the delayed
vesting of the recipient's rights to the stock. Unless the recipient makes an
election under the Code Section 83(b) within 30 days after the receipt of the
restricted shares, he or she generally will not be taxed on the receipt of
restricted shares until the restrictions on the shares expire or are removed.
When the restrictions expire or are removed, the recipient will recognize
ordinary income in an amount equal to the excess of the fair market value of
the shares at that time over the purchase price. If the recipient makes an
83(b) election within 30 days of the receipt of restricted shares, however, he
or she will recognize ordinary income equal to the excess of the fair market
value of the shares on the date of receipt (determined without regard to
vesting restrictions) over the purchase price.

Other Awards. We may grant awards under the Plan that do not fall clearly
into the categories described above. The federal income tax treatment of these
awards will depend upon the specific terms of the awards.

Special rules will apply in cases where a recipient of an award pays the
exercise or purchase price of the award, or applicable withholding tax
obligations under the Plan, by delivering previously owned shares of OPL
Common Stock or by reducing the amount of shares otherwise issuable pursuant
to the award. This surrender or withholding of shares will, in some
circumstances, result in the recognition of income with respect to these
shares or a carryover basis in the shares acquired. Furthermore, special tax
consequences may apply if the optionee is subject to suit under Section 16(b)
of the Securities Exchange Act of 1934 (the Short swing profit rule).

In the event of change in control of OPL, and depending upon the individual
circumstances of the recipient, some amounts with respect to the award may be
"excess parachute payments" under the "golden parachute" provisions of the
Code. Pursuant to these provisions, a recipient will be subject to a 20%
excise tax on any "excess parachute payments."

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The Board of Directors Recommends That Shareowners Vote FOR Approval of the
Overseas Partners Ltd. Incentive Compensation Plan

PROPOSED AMENDMENT TO THE MEMORANDUM OF ASSOCIATION
(Proposal No. 4)

At its meeting on May 11, 2000, the Board of Directors approved and set for
shareowner vote an amendment to OPL's Memorandum of Association that would
increase our minimum share capital from $120,000 to $370,000. A copy of the
proposed amendment is attached to this proxy statement as Annex B.

In 1983, OPL registered as a general insurer under the Insurance Act of 1978
(the "Act"). Under the Act, a general insurer is required to maintain a
minimum share capital of $120,000. Subsequent to this date, OPL registered as
a long-term composite insurer, which permitted it to write both general and
long-term business. A composite insurer is required to maintain a minimum
share capital of $370,000. The proposed amendment to our Memorandum of
Association reflects the increased share capital required for composite
insurers under the Act.

The Board of Directors Recommends That Shareowners Vote FOR
the Proposed Amendment to our Memorandum of Association

VOTING REQUIREMENTS

OPL's Bye-laws require that at any Annual General Meeting of Shareowners,
two shareowners present in person and representing in person or by proxy in
excess of 50% of the outstanding voting shares of Common Stock will constitute
a quorum for the Meeting. The Bye-laws further provide that any question
brought before the Annual General Meeting will be decided by a simple majority
of the votes cast, unless otherwise provided by The Companies Act of 1981 of
Bermuda.

The election of directors, the appointment of auditors, approval of the
Incentive Plan and the amendment to the Memorandum of Association will be
decided by a simple majority of 50% plus one of the votes cast. A vote
withheld in the election of directors will be counted as a vote against a
nominee. An abstention will have no effect on the outcome of the voting in
respect of the election of directors, appointment of auditors, approval of the
Incentive Plan or amendment to the Memorandum of Association.

OTHER BUSINESS

The Board is not aware of any business other than the election of Directors,
the appointment of auditors, approval of the Incentive Plan, and the amendment
to the Memorandum of Association to be presented for action at the Meeting.
However, should any other matters requiring a vote of the shareowners arise,
the proxies named in the accompanying proxy or Letter of Instruction will vote
in accordance with their own best judgment.

SHAREOWNER PROPOSALS

In order for proposals of shareowners to be considered for inclusion in the
proxy materials for the 2001 Meeting, such proposals must be received by OPL
not later than January 15, 2001.

Notice of a proposal which a shareowner wishes to raise at the 2001 Meeting
but does not wish to have included in OPL's proxy materials for that meeting
must be received by the Secretary of the Company not more than 60 days and not
less than 30 days in advance of the 2001 Meeting in order to be considered
timely under the Company's Bye-laws. However, in the event that the Company
gives shareowners less than 40 days' notice of the date of the 2001

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Annual Meeting, notice of a proposal by a shareowner, to be timely, must be
received not later than the close of business on the tenth day following the
date that notice of the 2001 Meeting was mailed or public disclosure was made,
whichever occurs.

ANNUAL REPORT ON FORM 10-K

A copy of OPL's 1999 Annual Report on Form 10-K, including financial
statements and schedules, as filed with the Securities and Exchange Commission,
may be obtained without charge upon written request to: Assistant Secretary,
Overseas Partners Ltd., Mintflower Place, 8 Par-la-Ville Road, Hamilton HM GX,
Bermuda.

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ANNEX A

OVERSEAS PARTNERS lTD.
INCENTIVE COMPENSATION PLAN

Article 1

Establishment, Objectives, and Duration

1.1. Establishment of the Plan. By this document, Overseas Partners Ltd., a
Bermuda company (the "Company"), establishes the incentive compensation plan.
The Plan permits the Committee to grant Nonqualified Stock Options, Incentive
Stock Options, Stock Appreciation Rights, Restricted Stock, Performance Shares
and Performance Units, and it allows employees to purchase Shares as described
in Article 10.

1.2. Objectives of the Plan. The objectives of the Plan are to: (a) optimize
the profitability and growth of the Company by linking the compensation of
Participants to the value of the Company's Shares and thereby aligning the
interests of Participants more closely with those of the Company's
shareowners; (b) to provide Participants with an incentive for excellence in
individual performance; and (c) to promote teamwork among Participants. The
Plan is also intended to provide flexibility to the Company in its ability to
motivate, attract, and retain employees who make significant contributions to
the Company's success by allowing Participants to share in the success of the
Company.

1.3. Duration of the Plan. Subject to approval by the Company's shareowners,
the Plan shall become effective on May 11, 2000 and shall remain in effect
(subject to the right of the Committee to amend or terminate the Plan as
described in Article 15), until all Shares allotted to the Plan have been
purchased or acquired according to the Plan's provisions. However, no Awards
will be granted under the Plan on or after May 11, 2010. Employees may
purchase Shares as described in Article 10 after May 11, 2010, subject to the
Committee's right to amend or terminate the Plan as described in Article 15.

Article 2

Definitions

The following terms shall have the meanings set forth below, and when this
meaning is intended, the initial letter of the word shall be capitalized:

2.1. Affiliate means any corporation, partnership, joint venture or other
entity in which the Company either directly or indirectly controls at least
25% of the voting interest or owns at least 25% or more of the value or
capital or profits interest of such entity.

2.2. Award means, individually or collectively, a grant under this Plan of
Nonqualified Stock Options, Incentive Stock Options, Stock Appreciation
Rights, Restricted Stock, Performance Shares and Performance Units.

2.3. Award Agreement means an agreement entered into by the Company and a
Participant setting out the terms and provisions applicable to an Award.

2.4. Beneficial Owner or Beneficial Ownership shall have the meaning given
to the term in Rule 13d-3 of the General Rules and Regulations under the
Exchange Act.

2.5. Board or Board of Directors means the Board of Directors of the
Company.

A-1
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2.6. Change in Control of the Company shall be deemed to have occurred as of
the first day that any one or more of the following conditions has been
satisfied:

(a) The Shareowners of the Company approve a reorganization, merger,
share exchange or consolidation, in each case, where persons who were
shareowners of the Company immediately prior to such reorganization,
merger, share exchange or consolidation do not, immediately afterward, own
more than 50% of the combined voting power of the reorganized, merged,
surviving or consolidated company's then outstanding securities entitled to
vote generally in the election of directors; or

(b) There is a liquidation or dissolution of the Company or the sale of
substantially all of the Company's assets; or

(c) After May 11, 2000, there is a change of 20% or more of the members
of the Board of Directors of the Company (the "Incumbent Board"). However,
any person becoming a director after May 11, 2000, who was properly elected
and was approved by a vote of at least 50% of the current directors (other
than an individual whose initial assumption of office is in connection with
an actual or threatened election contest relating to the election of the
directors, as such terms are used in Rule 14a-11 of Regulation 14A
promulgated under the Exchange Act) shall be deemed a member of the
Incumbent Board; or

(d) After May 11, 2000, there is a change of 50% or more of the executive
officers of the Company at the level of Vice President and above within a
consecutive 12-month period.

2.7. Code means the Internal Revenue Code of 1986, as amended from time to
time, or any successor Act to the Code.

2.8. Committee means the Compensation Committee of the Board.

2.9. Company means Overseas Partners Ltd. and its Subsidiaries and
Affiliates.

2.10. Director means any individual who is a member of the Board of
Directors.

2.11. Disability shall have the meaning given to the term in the Company's
long-term disability plan, or if no such plan exists, the meaning determined
by the Committee in its discretion.

2.12. Effective Date means May 11, 2000.

2.13. Employee means a person providing services to the Company who is
classified on the Company payroll as an employee. Under no circumstances shall
an individual who performs services for the Company, but who is not classified
on the Company's payroll as an employee (for example, an individual performing
services for the Company under a leasing agreement), be treated as an Employee
even if that individual qualifies as an "employee" of the Company by virtue of
common law principles or the leased employee rules under Code (S)414(n).
Further, if an individual performing services for the Company is later
reclassified as an Employee of the Company, this reclassified individual shall
not be treated as an Employee for purposes of this Plan for any period prior
to the actual date of his or her reclassification. Directors who are employed
by the Company shall be considered Employees under this Plan.

2.14. ERISA means the Employee Retirement Income Security Act of 1974, as
amended from time to time, or any successor act to ERISA.

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2.15. Exchange Act means the Securities Exchange Act of 1934, as amended
from time to time, or any successor act to the Exchange Act.

2.16. Fair Value of a Share shall mean, as of any date, the value of a Share
determined as follows:

(a) If the common stock of the Company is listed on any established stock
exchange or quoted on an electronic quotation system, the Fair Value of a
Share shall be the closing sale price for the common stock (or the mean of
the closing bid and asked prices, if no sales were reported on the relevant
date), as quoted on such exchange or system on the last trading day before
the date the Share value is to be determined, as reported in The Wall
Street Journal or any other source that the Board deems reliable; or

(b) If the common stock of the Company is not publicly traded (i.e.,
there is no established market for the common stock of the Company), the
Fair Value of a Share shall be the price per Share that the Board has most
recently authorized the Company to purchase from its shareowners. In making
this determination, the Board may consider a variety of factors, including
past and current earnings, earnings estimates, the ratio of the Company
common stock to debt of the Company, the stock price, earnings and book
value of comparable companies, industry considerations, liquidity, other
factors affecting the business and outlook of the Company and general
economic conditions, as well as opinions furnished by investment advisors
and other experts acting as independent appraisers. The Board shall not be
required to follow any predetermined formula, but shall have discretion to
exercise its judgment in light of the long-term interests of the Company
and its shareowners; or

(c) If, for any reason, the Fair Value of a Share cannot be determined or
is unavailable for the date in question, the Fair Value of a Share may, in
the sole and absolute discretion of the Board, be determined as of the
nearest preceding date on which the value can be determined under the
appropriate method described above.

2.17. Freestanding SAR means an SAR that is granted independently of any
Options, as described in Article 7.

2.18. Incentive Stock Option or ISO means an option to purchase Shares
granted under Article 6, which is designated as an Incentive Stock Option and
is intended to meet the requirements of Code (S)422.

2.19. Insider means an individual who is, on the relevant date, an officer,
Director or ten percent (10%) Beneficial Owner of any class of the Company's
equity securities that is registered pursuant to Section 12 of the Exchange
Act, all as defined under Section 16 of the Exchange Act.

2.20. Key Person means a consultant, distributor or other person who has
rendered or will render valuable services to the Company.

2.21. Nonqualified Stock Option or NQSO means an option to purchase Shares
granted under Article 6 that is not intended to be treated as an ISO under
Code (S)422.

2.22. Option means an Incentive Stock Option or a Nonqualified Stock Option
as described in Article 6.

2.23. Option Price means the price at which a Share may be purchased by a
Participant in respect of an Option.

2.24. Outside Director means a member of the Board who is not an employee
and who qualifies as (1) a "non-employee director" under Rule 16b-3(b)(3) of
the General Rules and Regulations of the Exchange Act, and (2) an "outside
director" under Code (S)162(m) and regulations made thereunder.

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2.25. Participant means an Employee, Director or Key Person who has been
selected to receive an Award or who has an Award outstanding under the Plan.

2.26. Performance-Based Exception means the performance-based exception from
the deduction limitations of Code (S)162(m).

2.27. Performance Share means an Award granted to a Participant, as
described in Article 9.

2.28. Performance Unit means an Award granted to a Participant, as described
in Article 9.

2.29. Period of Restriction means the period during which the transfer of
Shares of Restricted Stock is subject to a substantial risk of forfeiture, as
described in Article 8.

2.30. Plan Year means the period from March 1 to February 28 of each
calendar year.

2.31. Restricted Stock means an Award granted to a Participant as described
in Article 8. This term also includes awards of units tied to the value of
Shares, but not in the form of actual Shares, during the Period of
Restriction.

2.32. Retirement means the first day of the calendar month on which the
Participant reaches the age of 65 or such other date as determined by the
Committee in its discretion.

2.33. Shares means shares of the common stock, par value $0.10 per share, of
the Company.

2.34. Stock Appreciation Right or SAR means an Award, granted alone or in
connection with a related Option, as described in Article 7.

2.35. Subsidiary means any corporation, partnership, joint venture, or other
entity in which the Company either directly or indirectly controls at least
50% of the voting interest or owns at least 50% of the value or capital or
profits interest.

2.36. Tandem SAR means an SAR that is granted in connection with a related
Option as described in to Article 7, the exercise of which shall require
forfeiture of the right to purchase a Share under the related Option (and when
a Share is purchased under the Option, the Tandem SAR shall similarly be
canceled).

2.37. Target Amount means, with respect to an Award, the target amount upon
which such Award is based, which shall be specified in the Award Agreement.

2.38. Termination For Cause or For Cause shall have the meaning given to the
term(s) in the Company's Handbook, or if no Handbook exists, the meaning
determined by the Committee in its discretion.

Article 3

Administration

3.1. General. The Plan shall be administered by the Committee; provided,
however, that: (1) the Board may at any time take on the powers, authority and
duties of the Committee, and (2) the Board shall have the powers, authority
and duties of the Committee with respect to the granting and interpretation of
Awards to Outside Directors. The Committee shall be appointed by, and shall
serve at the discretion of, the Board of Directors. If permitted by law, the
Committee shall have the authority to delegate administrative duties to
officers or Directors of the Company. Provided however, that only a Committee
(or a sub-committee) comprised solely of two or more Outside Directors may
grant Awards that will meet the Performance-Based Exception.

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3.2. Authority of the Committee. Except as limited by law or by the
Memorandum of Association or Bye-laws of the Company, and subject to the
provisions described in this document, the Committee shall have full power to
select the Employees, Directors and Key Persons who are granted Awards;
determine the sizes and types of Awards; determine the terms and conditions of
Awards in a manner consistent with the Plan; construe and interpret the Plan
and any agreement or instrument entered into under the Plan; establish, amend,
or waive rules and regulations for the Plan's administration; and (subject to
the provisions of Article 14 and Article 15) amend the terms and conditions of
any outstanding Award. Further, the Committee shall make all other
determinations that may be necessary or advisable for the administration of
the Plan.

3.3. Decisions Binding. All decisions made by the Committee under this Plan
and all related orders and resolutions of the Committee shall be final,
conclusive and binding on all persons, including the Company, its shareowners,
Directors, Employees, Key Persons, Participants, and their estates and
beneficiaries.

Article 4

Shares Subject to the Plan and Maximum Awards

4.1. Number of Shares Available for Grants. Subject to adjustment as
provided in Sections 4.2 and 15.2, the number of Shares reserved for issuance
to Participants under the Plan shall be five million (5,000,000). The
Committee shall determine the appropriate method for calculating the number of
Shares actually issued under the Plan. Unless the Committee determines that an
Award shall not be designed to comply with the Performance-Based Exception,
the following rules shall apply to Awards granted under the Plan:

(a) Stock Options: The maximum number of Shares that may be granted in
the form of Stock Options in any one Plan Year, to any one Participant,
shall be 150,000.

(b) SARs: The maximum number of Shares that may be granted in the form of
Stock Appreciation Rights in any one Plan Year, to any one Participant,
shall be 150,000.

(c) Restricted Stock: The maximum number of Shares that may be granted in
the form of Restricted Stock in any one Plan Year, to any one Participant,
shall be 150,000.

(d) Performance Shares/Units: The maximum payout (determined at the end
of the applicable Performance Term, as defined in Article 9) with respect
to Awards of Performance Shares/Units granted in any one Plan Year, to any
one Participant, shall equal the value of 150,000 Shares.

(e) Stock Purchase Plan: The maximum number of Shares that may be
purchased in any one Plan Year, by any one Participant, shall be 20,000.

4.2. Adjustments in Authorized Shares. In the event of any change in
corporate capitalization, such as a stock split or dividend, or a corporate
transaction, such as a merger, consolidation, separation, including a spin-
off, or other distribution of stock or property of the Company, any
reorganization (whether or not such reorganization comes within the definition
of such term in Code (S)368) or any partial or complete liquidation of the
Company, an adjustment shall be made in the number and class of Shares
reserved for issuance under Section 4.1, in the number and class of and/or
price of Shares subject to outstanding Awards granted under the Plan, and in
the Award limits described in Section 4.1, as the Committee, determines to be
appropriate and equitable in order to prevent dilution or enlargement of
rights; provided, however, that the number of Shares awarded shall always be a
whole number.

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4.3. Reissuance of Shares. If any Shares subject to an Award are forfeited
or an Award otherwise terminates without the issuance of all of the Shares to
a Participant, or if any Shares are surrendered by a Participant in full or
partial payment of the price of an Option, these Shares shall be available for
grant under the Plan.

Article 5

Eligibility and Participation

5.1. Eligibility. Persons eligible to participate in this Plan include all
Employees, Directors and Key Persons.

5.2. Actual Participation. Subject to the provisions of the Plan, the
Committee may, at its discretion, select from all eligible Employees,
Directors and Key Persons, those to whom Awards shall be granted and shall
determine the nature and amount of each Award.

Article 6

Stock Options

6.1. Grant of Options. Subject to the terms and provisions of the Plan, the
Committee may grant Options in such number, and upon such terms, and at such
time as the Committee, may determine; provided, however, that ISOs may only be
granted to Participants who are Employees of the Company or a "subsidiary" of
the Company (within the meaning of Code (S)424(f)).

6.2. Award Agreement. Stock Options shall be granted in an Award Agreement
that shall specify the Option Price, the duration of the Option, the number of
Shares to which the Option relates, and such other provisions as the Committee
determines. The Award Agreement shall also state whether the Option is
intended to be an ISO or an NQSO.

6.3. Option Price. The Option Price for each Option shall be at least equal
to one hundred percent (100%) of the Fair Value of a Share on the date as of
which the Option is granted. With respect to Awards of ISOs, the Option Price
of any ISO may not be less than one hundred percent (100%) of the Fair Value
of a Share on the date as of which the Option is granted, and the Option Price
of any ISO which is granted to an individual who owns more than ten percent
(10%) of the voting power of all classes of stock of the Company or any
"parent" or "subsidiary" corporation of the Company (within the meaning of
Code (S)424(e) and (f) may not be less than one hundred and ten percent (110%)
of the Fair Value of a Share on the date as of which the Option is granted.

6.4. Duration of Options. Each Option shall expire on a date determined by
the Committee at the time of grant; provided, however, that no Option shall be
exercisable later the tenth (10th) anniversary date of its grant.

6.5. Exercise of Options. Options granted shall be exercisable at such times
and be subject to such restrictions and conditions as the Committee shall in
each instance approve, which need not be the same for each grant or for each
Participant.

6.6. Payment. Options granted shall be exercised by the delivery of notice
to the Company (in accordance with the procedures established by the
Committee), setting forth the number of Shares with respect to which the
Option is to be exercised, together with full payment for the Shares.

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The Option Price upon exercise of any Option shall be payable to the Company
in full either:

(a) in cash or its equivalent, or

(b) by tendering previously acquired Shares having a total value at the
time of exercise equal to the Option Price, or

(c) by a combination of (a) and (b); provided, however, that Shares
tendered must have been held by the Participant for at least six (6) months
prior to their tender (i.e., "mature shares" for accounting purposes).

Further, with respect to any Participant who is an Insider, if tendering
shares, the transaction (1) must have met the requirements of an exemption
under Rule 16b-3 of the General Rules and Regulations of the Exchange Act (the
"General Rule"), as amended from time to time, or (2) be a subsequent
transaction, the terms of which were provided for in a transaction initially
meeting the requirements of an exemption under the General Rule. Unless the
Award Agreement provides otherwise, paying the Option Price as described
above, or other evidence of share ownership shall be deemed to be subsequent
transactions approved by the original grant of an Option.

6.7. Delivery of the Shares. As soon as practicable after exercise of an
Option, the Company will deliver to First Union, as Custodian for the Shares,
for the benefit of the Participant, the Shares purchased by the Participant.
First Union will send the Participant notification that it has the Shares in
its possession.

First Union will register the Shares in its name and will sell or otherwise
dispose of the Shares upon the Participant's instruction and in conformity
with the restrictions contained in the Company's Bye-laws. Any cash dividends
and other distributions that may be paid on the Shares will be promptly
remitted by First Union to the Participant. Until instructions are received by
First Union requesting that the certificates for Shares be delivered to a
purchaser, First Union will continue to hold such Shares, as Custodian for the
purchaser.

6.8. Restrictions on Share Transferability. All Shares acquired shall be
subject to the Company's Bye-laws and the Memorandum of Association. Further,
the Committee may impose such restrictions on any Shares acquired under this
Article, as it may deem advisable, including, without limitation, restrictions
under applicable federal securities laws, under the requirements of any stock
exchange or market upon which the Shares are then listed and/or traded, and
under any state securities laws applicable to the Shares.

6.9. Termination of Employment/Directorship/Other Relationship. If a
Participant's employment is terminated because of a loss of Bermuda work
permit, retirement, death or disability, or For Cause, Articles 19, 20 and 21
shall apply. Otherwise, each Participant's Award Agreement shall state the
extent to which the Participant may exercise the Option following termination
of the Participant's employment or directorship or other relationship with the
Company. Such provisions shall be determined by the Committee, shall be
included in the Award Agreement, need not be uniform among all Options issued
under this Article, and may reflect distinctions based on the reasons for
termination. However, for Participants receiving ISO's, in no event shall the
Award Agreement for the ISO specify that the Option may be exercised beyond
the time limits established in Code (S)422, unless the Option is no longer to
be considered an ISO.

6.10. No transferability of Options. Except as otherwise provided in a
Participant's Award Agreement, no Option granted under this Article may be
sold, transferred, pledged, assigned, or otherwise alienated or hypothecated,
other than by will or by the laws of descent and distribution. Further, except
as otherwise provided in a Participant's Award Agreement, all Options granted
to a Participant under this Article shall be exercisable during his or her
lifetime only by such Participant; provided, however, that in the event the
Participant is incapacitated and unable to exercise

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his or her Option, the Option may be exercised by the Participant's legal
representative, or other representative whom the Committee deems appropriate.
The determination of incapacity of a Participant and the determination of the
appropriate representative of the Participant shall be determined by the
Committee.

Article 7

Stock Appreciation Rights

7.1. Grant of SARs. Subject to the terms and conditions of the Plan, the
Committee may grant SARs in such number and upon such terms, and at such time
as the Committee, may determine. The Committee may grant Freestanding SARs,
Tandem SARs, or any combination of these forms of SARs. The grant price of a
Freestanding SAR shall equal the Fair Value of a Share on the date of grant of
the SAR. The grant price of a Tandem SAR shall equal the Option Price of the
related Option.

7.2. SAR Agreement. SARs shall be granted in an Award Agreement that shall
specify the grant price, the term of the SAR, and such other provisions as the
Committee shall determine.

7.3. Term of SARs. Each SAR shall expire on a date determined by the
Committee at the time of grant; provided, however, that no SAR shall be
exercised later than the tenth (10th) anniversary of the date of grant.

7.4. Exercise of Tandem SARs. Tandem SARs may be exercised for all or part
of the Shares subject to the related Option. Upon exercise of a Tandem SAR,
the related Option shall automatically be canceled to the extent of the number
of Shares subject to the exercise. Conversely, if the related Option is
exercised, the Tandem SAR shall automatically be canceled to the extent of the
number of Shares subject to the exercise. A Tandem SAR may only be exercised
with respect to Shares for which its related Option is exercisable.

Notwithstanding any other provision of this Plan to the contrary, with
respect to a Tandem SAR granted in connection with an ISO: (a) the Tandem SAR
will expire at the same time as the underlying ISO; (b) the value of the
payout with respect to the Tandem SAR may not be greater than one hundred
percent (100%) of the difference between the Option Price of the underlying
ISO and the Fair Value of the Shares subject to the ISO at the time the Tandem
SAR is exercised; and (c) the Tandem SAR may only be exercised when the Fair
Value of the Shares subject to the ISO exceeds the Option Price of the ISO.

7.5. Exercise of Freestanding SARs. Freestanding SARs shall be exercised
according to the terms and conditions contained in the Award Agreement.

7.6. Payment of SAR Amount. Upon exercise of an SAR, the Participant shall,
upon exercise, be entitled to receive from the Company an amount equal to: (a)
multiplied by (b) where (a) and (b) equal the following:

(a) (i) The Fair Value of a Share on the date of exercise; less

(ii) The grant price per Share; plus

(iii) Paid and declared dividends per Share of common stock
underlying the SAR from the beginning of the grant date to the
date the SAR is exercised;

(b) The number of Shares with respect to which the SAR is exercised.

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As indicated above, upon exercise of an SAR, a Participant shall be entitled
to all dividends paid (either cash or stock) and declared on Shares of common
stock underlying the SAR from the grant date to the date the SAR is exercised.
During this period, dividends will accrue without interest.

The form of SAR payout shall be stated in the Award Agreement. Payment may
be in cash, in Shares of equivalent value, or some combination of these two.

7.7. Termination of Employment/Directorship/Other Relationship. If a
Participant's employment is terminated because of a loss of Bermuda work
permit, retirement, death or disability, or For Cause, Articles 19, 20 and 21
shall apply. Otherwise, each SAR Award Agreement shall state the extent to
which the Participant has the right to exercise the SAR following termination
of the Participant's employment or directorship or other relationship with the
Company. Such provisions shall be determined in the sole discretion of the
Committee, shall be included in the Award Agreement entered into with the
Participant, need not be uniform among all SARs issued pursuant to the Plan,
and may reflect distinctions based on the reasons for termination.

7.8. Nontransferability of SARs. Except as otherwise provided in a
Participant's Award Agreement, no SAR granted under the Plan may be sold,
transferred, pledged, assigned, or otherwise alienated or hypothecated, other
than by will or by the laws of descent and distribution. Further, except as
otherwise provided in a Participant's Award Agreement, all SARs granted to a
Participant under the Plan shall be exercisable during his or her lifetime
only by such Participant; provided, however, that in the event the Participant
is incapacitated and unable to exercise his or her SAR, such SAR may be
exercised by such Participant's legal representative, or other representative
whom the Committee deems appropriate. The determination of incapacity of a
Participant and the appropriate representative shall be determined by the
Committee.

Article 8

Restricted Stock

8.1. Grant of Restricted Stock. Subject to the terms and provisions of the
Plan, the Committee may grant Shares of Restricted Stock in such number and
upon such terms, and at such times, as the Committee, may determine.

8.2. Award Agreement. Restricted Stock shall be granted in an Award
Agreement that shall specify the Period(s) of Restriction, the number of
Shares of Restricted Stock granted, conditions and/or restrictions to the
grant, if any, and such other provisions as the Committee shall determine.

8.3. Other Restrictions. All Shares of Restricted Stock shall be subject to
the Company's Bye-laws and Memorandum of Association. Further, the Committee
shall impose such other conditions and/or restrictions on any Shares of
Restricted Stock granted under the Plan as it deems advisable including,
without limitation: (1) a requirement that Participants pay a stipulated
purchase price for each Share of Restricted Stock; (2) restrictions based upon
the achievement of specific performance goals; (3) time-based restrictions on
vesting following the attainment of the performance goals, and (4)
restrictions under applicable federal or state securities laws. Such
restrictions may apply after the Period of Restriction specified in the Award
Agreement, or after the satisfaction of any other conditions set forth in the
Award Agreement. Shares of Restricted Stock shall be forfeited to the extent
that a Participant fails to satisfy the applicable conditions and/or
restrictions during the Period of Restriction. The Company may retain the
certificates representing Shares of Restricted Stock in the Company's
possession until such time as all conditions and/or restrictions applicable to
the Shares have been satisfied. Except as otherwise provided in this Article,
the Company's Bye-laws and/or Memorandum of Association, or as otherwise
provided in the Award Agreement, Shares of Restricted Stock granted under the
Plan shall become freely transferable by the Participant after the last day of
the applicable Period of Restriction.

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8.4. Voting Rights. Unless otherwise provided in the Award Agreement,
Participants holding Shares of Restricted Stock granted under the Plan shall
be permitted to exercise full voting rights with respect to those Shares
during the Period of Restriction.

8.5. Dividends. Unless otherwise provided in the Award Agreement, during the
Period of Restriction, Participants holding Shares of Restricted Stock granted
under the Plan shall be credited with dividends (either cash or stock) paid or
declared, as well as any other non-cash distributions made by the Company with
respect to the underlying Shares all of which shall be accrued and granted
upon vesting of the Restricted Stock. During the Period of Restriction,
dividends shall be accrued without interest. The Committee may apply any
restrictions to the dividends and/or distributions that the Committee deems
appropriate. Without limiting the generality of the preceding sentence, if the
grant or vesting of Shares of Restricted Stock is intended to comply with the
requirements of the Performance-Based Exception, the Committee may apply any
restrictions it deems appropriate to the payment of dividends declared with
respect to such Shares of Restricted Stock, such that the dividends and/or the
Shares of Restricted Stock maintain eligibility for the Performance-Based
Exception.

8.6. Transferability. Except as otherwise provided in a Participant's Award
Agreement, and subject to the Company's Bye-laws and Memorandum of
Association, Shares of Restricted Stock may not be sold, transferred, pledged,
assigned, or otherwise alienated or hypothecated until the end of the
applicable Period of Restriction specified in the Award Agreement, or upon
earlier satisfaction of any other conditions in the Award Agreement, other
than by will or by the laws of descent and distribution.

8.7. Termination of Employment/Directorship/Other Relationship. If a
Participant's employment is terminated because of a loss of Bermuda work
permit, retirement, death or disability, or For Cause, Articles 19, 20 and 21
shall apply. Otherwise, each Restricted Stock Award Agreement shall set forth
the extent to which the Participant shall have the right to receive unvested
Restricted Shares following termination of the Participant's employment or
directorship or other relationship with the Company prior to the end of the
Period of Restriction. Such provisions shall be determined by the Committee,
shall be included in the Award Agreement, need not be uniform among all Shares
of Restricted Stock issued under the Plan, and may reflect distinctions based
on the reasons for termination.

Article 9

Performance Units and Performance Shares

9.1. Grant of Performance Units/Shares. Subject to the terms of the Plan,
the Committee may grant Performance Units and Performance Shares in such
number, and upon such terms, and at such time as the Committee, may determine.

9.2. Award Agreement. Performance Units or Performance Shares shall be
granted in an Award Agreement that shall specify the initial value of the
Performance Units/Shares, the performance goals, the number of Performance
Units/Shares granted, and such other provisions as the Committee shall
determine.

9.3. Value of Performance Units/Shares. Each Performance Unit shall have an
initial value that is established by the Committee at the time of grant. Each
Performance Share shall have an initial value equal to the Fair Value of a
Share as of the date of grant. The Committee shall set performance goals in
its discretion which, depending on the extent to which they are met, will
determine the number and/or value of Performance Units/Shares that will be
paid to the Participant. For purposes of this Article, the time period during
which the performance goals must be met shall be called the "Performance
Term".

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9.4. Earning of Performance Units/Shares. Subject to the terms of this Plan,
after the applicable Performance Term has ended, the holder of Performance
Units/Shares shall be entitled to receive payout on the number and value of
Performance Units/Shares earned by the Participant over the Performance Term,
to be determined as a function of the extent to which the performance goals
have been met. Performance Units/Shares shall be forfeited to the extent that
a Participant fails to satisfy the applicable performance goals during the
Performance Term.

9.5. Form and Timing of Payment of Performance Units/Shares. Payment of
earned Performance Units/Shares shall be made in a single lump sum following
the close of the applicable Performance Term. Subject to the terms of this
Plan, the Committee, may pay earned Performance Units/Shares in the form of
cash or in Shares (or a combination of the two), which have a Fair Value equal
to the value of the earned Performance Units/Shares at the end of the
applicable Performance Term. Such Shares shall be granted subject to the
Company's Bye-laws and Memorandum of Association and to any restrictions
deemed appropriate by the Committee. The form of payout shall be stated in the
Award Agreement. The Award Agreement shall state whether a Participant is
entitled to receive any dividends (either cash or stock) declared with respect
to the Shares underlying the Performance Unit/Share. In addition, Participants
may, at the discretion of the Committee and as provided in the Award
Agreement, be entitled to exercise voting rights with respect to such Shares.

9.6. Termination of Employment/Directorship/Other Relationship. If a
Participant's employment is terminated because of a loss of Bermuda work
permit, retirement, death or disability, or For Cause, Articles 19, 20 and 21
shall apply. Otherwise, the Award Agreement shall state the extent to which
the Participant shall have the right to receive payment with respect to
Performance Units/Shares following termination of the Participant's employment
or directorship or other relationship with the Company prior to the last day
of the Performance Term. Such provisions shall be determined by the Committee,
shall be included in the Award Agreement entered into with each Participant,
need not be uniform among all Performance Units/Shares issued pursuant to this
Plan, and may reflect distinctions based on the reasons for termination.

9.7. Non-transferability. Except as otherwise provided in an Award
Agreement, Performance Units/Shares may not be sold, transferred, pledged,
assigned, or otherwise alienated or hypothecated, other than by will or by the
laws of descent and distribution. Except as otherwise provided in a
Participant's Award Agreement, no Performance Units/Shares granted under the
Plan may be sold, transferred, pledged, assigned, or otherwise alienated or
hypothecated, other than by will or by the laws of descent and distribution.
Further, except as otherwise provided in a Participant's Award Agreement, all
Performance Units/Shares granted to a Participant under the Plan shall be
exercisable during his or her lifetime only by such Participant; provided,
however, that in the event the Participant is incapacitated and unable to
exercise his or her Performance Units/Shares, such Performance Units/Shares
may be exercised by such Participant's legal representative, or other
representative whom the Committee deems appropriate. The determination of
incapacity of a Participant and the appropriate representative shall be
determined by the Committee in its sole and absolute discretion.

Article 10

Employee Stock Purchase

10.1. Eligibility. Only Employees who, on the date on which their
subscription is accepted by the Company, have been employed by the Company for
at least six (6) months shall be entitled to purchase shares under the Plan;
provided, however, that Employees who are subject to Section 16(b) of the
Exchange Act may not subscribe to Shares unless such subscription is approved
by the Committee.

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10.2. Purchase Price; Delivery of Shares; Payment. The purchase price for
each Share shall equal the Fair Value. An eligible Employee may subscribe to
purchase not less than 50 Shares, nor more than 20,000 Shares annually, by
delivering a fully executed subscription agreement, together with a check or
money order payable to "First Union National Bank," ("First Union") as
Transfer Agent. Availability of Shares to be purchased will be determined by
the Company in its sole discretion.

10.3. Acceptance of Subscriptions by the Company. No subscription for the
purchase of Shares will be binding on the Company until the Company has
accepted it. The Company reserves the right, in its sole discretion, to accept
or reject any subscription in part or in its entirety.

The Company's acceptance of a subscription will take place upon the mailing,
or personal delivery to the subscriber, of a notice of acceptance, confirming
its acceptance of the subscription, and showing the number and Fair Value of
the Shares sold to the subscriber ("Notice of Acceptance"). The subscriber
will be advised of the acceptance of his or her subscription by an account
statement from First Union, who is the Custodian for the Company's Shares,
indicating the number of Shares newly allocated to his or her account. The
account statement will be mailed to the subscriber as soon as practicable
after the purchase date.

The Company will not accept a subscription until the subscriber's check or
money order has been collected. If any check or money order cannot be
collected, the Company may, in its sole discretion, return the subscription
documents or request that the subscriber forward cash or wire funds in the
amount of his or her payment.

10.4. Normal Processing of Subscriptions. The process of receiving
subscriptions, determining acceptability and mailing Notices of Acceptance may
require up to 15 days after the Company receives the subscription. Employees
whose subscriptions for Shares are received less than 15 days prior to a
change in the Fair Value of the Shares may incur an increase in the Fair Value
of the Shares to which they subscribe. Similarly, subscriptions for Shares
received less than 15 days prior to the record date of a dividend on Shares
may not be processed in time to enable the subscriber to receive the dividend.
Subscribers will not be entitled to receive, and no adjustment will be made on
account of, any cash or stock dividend paid or declared to shareowners of
record on a date preceding acceptance of subscriptions (including where
subscriptions are accepted on a purchase date). In no event shall the Company
be liable for any costs or damages to a subscriber due to such changes in
price or the failure to receive such dividends. Further, in no event will
interest be paid on account of any subscription payment delayed due to
questions as to the acceptability of an individual subscriber.

10.5. Insufficient Number of Shares Available. If there are not enough
Shares available to satisfy all subscriptions for Shares the Company, in its
sole discretion, will fill subscriptions for Shares as such subscriptions are
received.

10.6. Effects of Changes in Fair Value or Dividends on Unaccepted
Subscriptions. Shares will be sold at the Fair Value in effect when the
Company accepts the subscription. Subscribers who send payment with their
subscription and whose subscriptions have not been accepted by the Company at
the time of an increase in the Fair Value of the Shares will be notified of
the increase, and the individual subscriber may then choose either (i) to
withdraw his or her subscription, or (ii) to pay the additional amount needed
to equal the higher Fair Value of the Shares, or (iii) to reduce to not less
than 50 the number of Shares subject to the subscription. If the Fair Value of
the Shares decreases at any time, the Company will give notice to subscribers
of this fact and afford them the opportunity to withdraw their subscription
or, in the alternative, either to seek a refund of the amounts not needed to
pay the aggregate Fair Value of the Shares subscribed to or to increase the
number of Shares which the subscriber desires to purchase.

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In the event of a stock split prior to acceptance of subscriptions that have
been received, the price and number of shares subject to the subscription will
be adjusted proportionately. The Board shall determine, in its sole
discretion, whether a distribution is a stock split.

10.7. Rejection of Subscriptions. Notwithstanding any provision of this Plan
to the contrary, the Committee, may accept or reject any subscription until
the subscription has been accepted. Upon the rejection of a subscription, the
Company will refund to the subscriber, or if applicable, will cause First
Union to refund to the subscriber, without interest, any monies paid by such
subscriber on account of his or her subscription.

10.8. Delivery of the Shares for the Account of Subscribers Upon
Acceptance. As soon as practicable after the Company has accepted a
subscription, the Company will deliver to First Union as Custodian for the
Shares, for the benefit of the subscriber, the Shares purchased by the
subscriber. First Union will send the Subscriber notification that it has the
shares in its possession.

First Union will register the Shares in its name and will sell or otherwise
dispose of the Shares upon the subscriber's instruction and in conformity with
the restrictions contained in the Company's Bye-laws. Any cash dividends and
other distributions that may be paid on the Shares will be promptly remitted
by First Union to the subscriber. Until instructions are received by First
Union requesting that the certificates for Shares be delivered to a purchaser,
First Union will continue to hold such Shares as Custodian for the purchaser.

Article 11

Performance Measures

11.1. Performance Measures. Until the shareowners approve a change in the
general performance measures set forth in this Article, the following will be
used by the Committee to determine the payout and/or vesting with respect to
Awards which are intended to qualify for the Performance-Based Exception:

(a) Earnings per share;

(b) Net income (before or after taxes);

(d) Cash flow return on investments which equals net cash flows divided
by owners equity;

(e) Earnings before or after taxes;

(f) Gross revenues;

(g) Share price (including, but not limited to, growth measures and total
shareowner return);

(h) Pretax profit;

(i) Economic Value Added;

(j) Gross premiums written;

(k) Combined ratio;

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(l) Underwriting income;

(m) Net income;

(n) Return on equity; and/or

(o) NPV of underwriting results.

11.2. Degree of Attainment. The Committee shall have discretion to determine
the degree to which the pre-established performance goals have been met;
provided, however, that Awards which are intended to qualify for the
Performance-Based Exception may not be adjusted upward (the Committee shall
retain the discretion to adjust such Awards downward).

11.3. Modifications to Performance Measures. In the event that applicable
tax and/or securities laws change to permit the Committee the discretion to
alter the governing performance measures without obtaining shareowner or
Participant approval of such changes, the Committee shall have sole discretion
to make such changes without obtaining shareowner or Participant approval. In
addition, in the event that the Committee determines that it is advisable to
grant Awards that shall not qualify for the Performance-Based Exception, the
Committee may make such grants without satisfying the requirements of Code
(S)162(m).

Article 12

Deferrals

The Committee may require or permit: (a) a Participant to defer his or her
receipt of payment or Shares that would otherwise be due to such Participant
by virtue of the exercise of an Option or SAR, (b) the lapse or waiver of
restrictions with respect to Restricted Stock, or (c) deferral of meeting any
requirements or goals with respect to Performance Units/Shares, provided that
no deferral shall be longer than 60 days without the prior written consent of
the Participant. If payment or receipt of Shares is deferred, the Committee
shall, establish rules and procedures for such payment deferrals. However,
notwithstanding the preceding provisions of this Article nor any other
provision of this Plan to the contrary, the Committee shall not, (1) in
establishing the terms and provisions of any Award, or (2) in exercising its
powers under this Article, create any arrangement which would constitute an
employee pension benefit plan as defined in ERISA (S)3(2) unless the
arrangement provides benefits solely to one or more individuals who constitute
members of a select group of management or highly compensated employees
(within the meaning of ERISA (S)(S)201(2), 301(a)(3), 401(a)(1) and
4021(b)(6)).

Article 13

Rights of Employees/Directors

13.1. Employment and Performance of Services. Nothing in the Plan shall
interfere with or limit in any way the right of the Company to terminate a
Participant's employment or service contract, nor confer upon a Participant
any right to continue in the employ of the Company or the right to continue
performing services for the Company.

13.2. Participation. No Employee, Director or Key Person shall have the
right to be selected to receive an Award under this Plan, or, having been so
selected, to be selected to receive a future Award.

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Article 14

Change in Control

14.1. Treatment of Outstanding Awards. Upon the occurrence of a Change in
Control, unless otherwise specifically prohibited under applicable laws, or by
the rules and regulations of any governmental agencies or national securities
exchanges, or otherwise agreed by the Company and the Participant:

(1) SARs. Any SARs granted under the Plan shall become immediately
exercisable and, within thirty (30) days following the effective date of the
Change in Control (the "Change in Control Date"), the Participant shall, upon
exercise, be paid as follows:

(a) If the Change of Control Date occurs within one year following the
date of grant of the SAR, the Participant shall be paid the greater of (i)
the Defined Amount, or (ii) the Target Amount upon which the Award was
based pro rated as to the time that has elapsed prior to the Change in
Control Date.

(b) If the Change of Control Date occurs later than one year following
the date of grant of the SAR, the Participant shall be paid the Defined
Amount.

The Defined Amount shall equal (a) multiplied by (b) where (a) and (b)
equal the following:

(a) (i) The Fair Value of a Share on the date of exercise; less

(ii) The grant price per Share; plus

(iii) Paid and declared dividends per Share of common stock underlying the
SAR from the beginning of the grant date to the date the SAR is
exercised;

(b) The number of Shares with respect to which the SAR is exercised.

(2) Restricted Stock (Non-performance based). Any restriction periods and
restrictions imposed on Shares of Restricted Stock based on continued service
and/or employment shall lapse and, within thirty (30) days following the
Change in Control Date, the Participant shall receive the number of Shares
specified as the Target Award, pro rated based on the time that has elapsed
under the Award Agreement prior to the Change in Control Date.

(3) Restricted Stock (Performance based) & Performance
Units/Shares. Performance-based Restricted Stock and Performance Units/Shares
shall vest as of the Change in Control Date, and within thirty (30) days
following the Change in Control Date, the Participant shall be paid the Target
Award (in cash or Shares, as the case may be) pro rated based upon assumed
achievement of all targeted performance goals and upon the length of time
within the Performance Term that has elapsed prior to the Change in Control
Date.

(4) Options. Any Options granted under the Plan shall become immediately
exercisable, and the Participant shall be entitled to exercise the Option for
the number of Shares specified as the Target Award, pro rated based on the
time that has elapsed prior to the Change in Control Date. The Participant
shall have thirty (30) days following the Change in Control Date to deliver
appropriate notice to the Company together with full payment for the Shares.

(5) Put Right. A Participant may not exercise his or her rights described in
Article 21.9 (the Put Option) more than forty-five (45) days after the Change
in Control Date.

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14.2. Special Gross-Up Payment for Excise Tax Imposed.

(a) Appointment of Independent Tax Consultant. Upon a Change In Control, the
Company shall appoint an independent tax consultant (the "ITC") who shall be a
lawyer, certified public accountant or a compensation consultant with
expertise in the area of executive compensation tax law, and whose fees and
disbursements shall be paid by the Company.

(b) Request for Gross-Up Payment. Upon a Change in Control, each Participant
who believes that he or she might be required to pay any Code (S)4999 excise
tax shall be entitled to request the calculation and payment of a Gross-Up
Payment (as defined below); provided, however, that any Participant requesting
the calculation and payment of a Gross-Up Payment must provide the ITC with
all information necessary for the ITC to determine the proper amount of Gross-
Up Payment which should be made to the Participant, and must agree to the
release of such information by the Company to the ITC.

(c) Calculations by ITC. The ITC shall, with respect to each Participant
making a request for the calculation and payment of a Gross-Up Payment (a
"Requesting Participant"), make a determination as to whether (1) the amounts
paid to such Participant under Awards issued under this Plan and (2) other
payments otherwise paid to such Participant, which constitute "parachute
payments" (as defined in Code (S)280G) (together "Parachute Payments") would
be subject to the Code (S)4999 excise tax. If the ITC determines that the
Parachute Payments to a Requesting Participant would be subject to the Code
(S)4999 excise tax, then that Participant shall receive an additional lump sum
cash payment (the "Gross-Up Payment") in an amount such that after payment by
the Requesting Participant of all federal and state taxes imposed upon the
Gross-Up Payment, the Requesting Participant retains from the Gross-Up Payment
an amount equal to the Code (S)4999 excise tax imposed upon the Parachute
Payments.

(d) IRS Assessments. If the ITC determines that no Code (S)4999 excise tax
is payable by a Requesting Participant, the ITC shall provide the Requesting
Participant with a written opinion that the Requesting Participant has
substantial authority not to report any Code (S)4999 excise tax due on the
Requesting Participant's income tax returns. A Requesting Participant shall
notify the Company in writing within 15 days of any claim by the Internal
Revenue Service ("IRS") that, if successful, would require the payment by the
Company of a Gross-Up Payment. If the Requesting Participant is subsequently
required to make a payment of any Code (S)4999 excise tax by the IRS, then the
Company shall make a payment (the "Gross-Up Underpayment") to the Requesting
Participant equal to the amount assessed as a Code (S)4999 excise tax by the
IRS; provided, however, the Company may, in lieu of making such Gross-Up
Underpayment to the Requesting Participant, notify the Requesting Participant
in writing that the Requesting Participant contest the IRS claim, in which
case the Requesting Participant and the Company shall cooperate, and the
Company shall bear all costs and expenses (including payment of any resulting
Code (S)4999 excise tax ultimately determined to be due, additional interest
and penalties) incurred in connection with contesting the IRS claim.

14.3. Termination, Amendment, and Modifications of Change-in-Control
Provisions. Notwithstanding any other provision of this Plan or any Award
Agreement provision to the contrary, the provisions of this Article 14 may not
be terminated, amended, or modified on or after the date of a Change in
Control in any manner that adversely affects any prior Award without the
written consent of the Participant; provided, however, that the Committee
shall retain the power to amend any provision of the Plan to comply with
changes in the Code, the Exchange Act or other applicable law or stock
exchange rule after the date of a Change in Control and further provided that
the Committee may terminate, amend, or modify this Article 14 and Section 2.6
at any time prior to the date of a Change in Control.

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Article 15

Amendment, Modification, and Termination

15.1. Amendment, Modification, and Termination. Subject to the terms of the
Plan, the Committee may at any time, alter, amend, suspend or terminate the
Plan in whole or in part.

15.2. Adjustment of Awards Upon the Occurrence of Certain Unusual or
Nonrecurring Events. Subject to Article 14 and to this Article 15, the
Committee may make adjustments in the terms and conditions of, and the
criteria included in, Awards in recognition of unusual or nonrecurring events
(including, without limitation, the events described in Section 4.2) affecting
the Company or the financial statements of the Company, or in the event of
changes in applicable laws, regulations, or accounting principles, whenever
the Committee determines that such adjustments are appropriate in order to
prevent dilution or enlargement of the benefits or potential benefits intended
to be granted under the Plan; provided that, unless the Committee determines
otherwise at the time such adjustment is considered, no adjustment shall be
made if it would be inconsistent with the requirements of Code (S)162(m), as
from time to time amended, to the extent the Award is intended to satisfy the
Performance-Based Exception.

15.3. Awards Previously Granted. Notwithstanding any other provision of the
Plan to the contrary, no termination, amendment, or modification of the Plan
shall adversely affect in any material way, any Award previously granted under
the Plan, without the written consent of the Participant holding such Award.

15.4. Compliance with Code (S)162(m). The Committee shall have full and
absolute discretion to determine whether an Award granted under this Plan is
intended to comply with the requirements of Code (S)162(m) and the regulations
thereunder. In addition, in the event that changes are made to Code (S)162(m)
to permit greater flexibility with respect to any Award under the Plan, the
Committee may make any adjustments it deems appropriate.

Article 16

Withholding

16.1. Tax Withholding. The Company shall have the power and the right to
deduct or withhold, or require a Participant to remit to the Company as a
condition precedent for the fulfillment of any Award, an amount sufficient to
satisfy all taxes (whether domestic or foreign), required by law or regulation
to be withheld with respect to any taxable event arising as a result of this
Plan, as it relates to the particular Participant.

16.2. Share Withholding. Whenever Shares are to be issued or cash paid to a
Participant upon the exercise of an Option, the Company shall have the right
to require the Participant to remit to the Company, as a condition of exercise
of the Option, an amount sufficient to satisfy federal, state and local
withholding tax requirements at the time of exercise. However, notwithstanding
the foregoing, to the extent that a Participant is an Insider, satisfaction of
the withholding tax requirements, by having the Company withhold Shares, may
only be made to the extent that such withholding of Shares (1) has met the
requirements of an exemption under Rule 16b-3 of the General Rules and
Regulations of the Exchange Act, or (2) is a subsequent transaction, the terms
of which were provided for in a transaction initially meeting the requirements
of an exemption under Rule 16b-3 of the General Rules and Regulations of the
Exchange Act. Unless the Award Agreement provides otherwise, the withholding
of Shares to satisfy federal, state and local withholding tax requirements
shall be a subsequent transaction approved by the original grant of an Award.
Shares withheld by the Company for taxes for any Award under this Plan shall
be limited to the minimum number sufficient to satisfy federal, state and
local tax withholding requirements at the time of exercise.

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Article 17

Indemnification

Each person who is or shall have been a member of the Committee, or of the
Board, or an officer delegated the administrative duties of the Board or
Committee, shall be indemnified and held harmless by the Company against and
from any loss, cost, liability, or expense that may be imposed upon or
reasonably incurred by him or her in connection with or resulting from any
claim, action, suit, or proceeding to which he or she may be a party or in
which he or she may be involved by reason of any action taken or failure to
act under the Plan and against and from any and all amounts paid by him or her
in settlement there of, with the Company's approval, or paid by him or her in
satisfaction of any judgment in any such action, suit, or proceeding against
him or her, provided he or she shall give the Company an opportunity, at its
own expense, to handle and defend the same before he or she undertakes to
handle and defend it on his or her own behalf. The foregoing right of
indemnification shall not be exclusive of any other rights of indemnification
to which such persons may be entitled under the Company's Bye-laws, as a
matter of law, or otherwise, or any power that the Company may have to
indemnify them or hold them harmless.

Article 18

Successors

All obligations of the Company under the Plan in respect to Awards granted
under this Plan shall be binding on any successor to the Company.

Article 19

Loss of Bermuda Work Permit

If a Participant's Bermuda work permit is not extended by a decision of the
Bermuda Department of Immigration, unless otherwise specifically prohibited
under applicable laws or by the rules and regulations of any governmental
agencies or national securities exchanges, or otherwise agreed by the Company
and the Participant:

(1) SARs. Any SARs granted to the Participant under the Plan shall become
immediately exercisable and, within thirty (30) days following the effective
date of notice of the non-renewal of the Bermuda work permit (the "Relevant
Date"), the Participant shall, upon exercise, be paid as follows:

(a) If the Relevant Date occurs within one year following the date of
grant of the SAR, the Participant shall be paid the greater of (i) the
Defined Amount, or (ii) the Target Amount upon which the award was based
pro rated as to the time that has elapsed prior to the Relevant Date.

(b) If the Relevant Date occurs later than one year following the date of
grant of the SAR, the Participant shall be paid the Defined Amount.

The Defined Amount shall equal (a) multiplied by (b) where (a) and (b) equal
the following:

(a) (i) The Fair Value of a Share on the date of exercise; less

(ii) The grant price per Share; plus

(iii) Paid and declared dividends per Share of common stock underlying the SAR
from the beginning of the grant date to the date the SAR is
exercised;

(b) The number of Shares with respect to which the SAR is exercised.

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(2) Restricted Stock (Non-performance based). Any restriction periods and
restrictions imposed on Shares of Restricted Stock based on continued service
and/or employment shall lapse and, within thirty (30) days following the
Relevant Date, the Participant shall receive the number of Shares specified as
the Target Award, pro rated based on the time that has elapsed under the Award
Agreement prior to the Relevant Date.

(3) Restricted Stock (Performance based) and Performance
Units/Shares. Performance-based Restricted Stock and Performance Units/Shares
shall vest as of the Relevant Date, and within thirty (30) days following the
Relevant Date, the Participant shall be paid the Target Award (in cash or
Shares, as the case may be) pro rated based upon an assumed achievement of all
targeted performance goals and upon the length of time within the Performance
Term that has elapsed prior to the Relevant Date.

(4) Options. Any Options granted under the Plan shall become immediately
exercisable, and the Participant is entitled to exercise the Option for the
number of Shares specified as the Target Award, pro rated based on the time
that has elapsed under the Award Agreement prior to the Relevant Date. The
Participant shall have thirty (30) days following the Relevant Date to deliver
appropriate notice to the Company together with full payment for the Shares.

(5) Put Right. A Participant may not exercise his or her rights described in
Article 21.9 (the Put Option) more than forty-five (45) days after the
Relevant Date.

Article 20

Retirement, Death, Disability or Termination For Cause

20.1. Retirement. Unless otherwise indicated in the Award Agreement, if a
Participant retires, all Awards shall vest and any performance-based or length
of service or employment based restrictions shall lapse. Any Option or SAR
shall be exercisable for the lesser of three (3) years or according to the
original term in the Award Agreement. If the Award is an Incentive Stock
Option, the Option must be exercised within ninety (90) days of Retirement in
order for the Option to continue to be treated as an Incentive Stock Option.

20.2. Disability. The rights under this Plan shall be exercisable only by a
Participant during his lifetime; provided, however, that in the event the
Participant is incapacitated and unable to exercise his or her rights, the
Participant's legal representative, or other representative whom the Committee
deems appropriate shall be permitted to exercise the rights under the Plan.
The determination of incapacity of a Participant and the determination of the
appropriate representative of the Participant shall be determined by the
Committee.

Unless otherwise indicated in the Award Agreement, if a Participant becomes
disabled, all Awards shall vest and any performance-based or length of service
or employment based restrictions shall lapse. Any Option or SAR shall be
exercisable for the lesser of three (3) years or according to the original
term in the Award Agreement. If the Award is an Incentive Stock Option, the
Option must be exercised within one (1) year of disability in order for the
Option to continue to be treated as an Incentive Stock Option.

Restricted Stock (Performance Based) and Performance Units/Shares. Upon
vesting of any Performance-based Restricted Stock and/or Performance
Units/Shares, the Participant's legal representative shall be paid the Target
Award (in cash or Shares, as the case may be) pro rated based upon assumed
achievement of all targeted performance goals and upon the length of time
within the Performance Term that has elapsed prior to the date of disability.

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20.3. Death. In the event of the death of a Participant, any rights of a
Participant under this Plan shall pass in accordance with the Participant's
will or by applicable laws of descent and distribution. Unless otherwise
indicated in the Award Agreement, if a Participant dies, all Award(s) shall
vest and any performance-based or length of service or employment based
restrictions shall lapse. Any Option or SAR shall be exercisable for the
lesser of three (3) years or according to the original term in the Award
Agreement.

20.4. Termination For Cause. In the event a Participant's employment or
agreement for services is terminated For Cause prior to the vesting of any
Award, all such Awards shall terminate simultaneous with the termination of
employment and the Participant shall have no right to receive any such Award.
Awards fully vested at the time of termination must be exercised within 30
days of termination. Further, the Participant shall not be permitted to put
Shares to the Company as described in Article 21.9 (the Put Option). The
Participant will, however, retain all rights of resale available to
shareowners generally.

Article 21

Miscellaneous

21.1. Number. Except where otherwise indicated by the context, the plural
shall include the singular and the singular shall include the plural.

21.2. Severability. In the event any provision of the Plan shall be held
illegal or invalid for any reason, the Plan shall be construed and enforced as
if the illegal or invalid provision(s) had not been included.

21.3. Requirements of Law. The granting of Awards and the issuance of Shares
under the Plan shall be subject to all applicable laws, rules, and
regulations, and to such approvals by any governmental agencies or national
securities exchanges as may be required.

21.4. Securities Law Compliance. With respect to Insiders, transactions
under this Plan are intended to comply with all applicable conditions or Rule
16b-3(b)(3) of the General Rules and Regulations of the Exchange Act or its
successors. To the extent any provision of the Plan or action by the Committee
fails to so comply, it shall be deemed null and void, to the extent permitted
by law and deemed advisable by the Committee.

21.5. Governing Law. The Plan, and all Award Agreements, shall be construed
in accordance with and governed by the laws of the Bermuda.

21.6. Plan Document Controls. In the event of any conflict between the
provisions of an Award Agreement, Plan Brochures and the Plan, the Plan shall
control, and the conflicting provisions of the Award Agreement and Plan
Brochure shall be null and void.

21.7. Unfunded Arrangement. The Plan shall not be funded, and except for
reserving a sufficient number of authorized shares to the extent required by
law to meet the requirements of the Plan, the Company shall not be required to
establish any special or separate fund or to make any other segregation of
assets to ensure the payment of any grant under the Plan.

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21.8. Awards Granted in Substitution. Notwithstanding any contrary
provision, in the event the Company engages in a recapitalization,
reorganization, merger, consolidation, combination, exchange of shares, spin-
off, acquisition or other business transaction with another organization, the
Committee, in its absolute discretion may grant Awards under the Plan in
substitution and cancellation of options, stock appreciation rights,
restricted stock, performance shares or performance Shares awarded to an
individual by such other organization. Awards made under this Section in
substitution for awards canceled as a result of such business transaction may
have an Option Price or grant price less than one hundred percent (100%) of
the Fair Value of a Share on the date such award is granted.

21.9. Put Option. A Participant in the Plan shall have the right to require
the Company to purchase all or part of the Shares then held by the Participant
at the Fair Value of the Shares, in accordance with the following terms and
conditions:

(a) Ability to Exercise Put Option. Except as provided in subsections (e)
and (f) below, the right to require the Company to purchase Shares may only
be exercised by the Participant.

(b) Price Paid by Company. The purchase price per Share paid for any
Shares put to the Company shall equal the Fair Value of a Share on the date
of the sale of the Shares to the Company multiplied by the number of Shares
being purchased.

(c) Form of Payment by Company. Payments by the Company shall be made in
a single lump sum cash (or check) payment and shall be paid on, or within
thirty (30) days after, the date the Shares are transferred to the Company.

(d) Procedures for Exercise. A Participant shall exercise his or her
rights under this Section by filing with the Company a written request
stating the number of Shares that the Participant wishes to put to the
Company. The Committee will consider the application at its next regularly
scheduled meeting, or at an early time determined by the Committee. If the
Committee approves the application, the Company will contact the
Participant and the parties shall arrange for the execution of all
documents that the Company requires for the transfer of the Shares and
payment of the purchase price.

(e) Status of Employment

(i) Current Employees. Current Employees may exercise the put right
at any time, subject to the approval of the Committee.

(ii) Loss of Work Permit or Termination For Cause. If a Participant's
employment is terminated because of a loss of Bermuda work permit,
or For Cause, Articles 19 and 20 shall apply.

(iii) Retirement. If a Participant's employment terminates because
of retirement, the following shall apply:

(a) For Shares owned outright (i.e. not subject to any
restrictions under Articles 6, 8 or 9): the Participant has
forty-five (45) days to request that the Company purchase these
Shares.

(b) Restricted Stock and Performance Shares that have not yet
vested: the Participant has forty-five (45) days from the date
of exercise of the grant and/or receipt of these Shares to
request that the Company purchase these Shares.

(iv) Voluntary Departure or termination without cause. If the
Participant voluntarily terminates his or her employment with the
Company, or is terminated without cause, he or she has forty-five
(45) days to request that the Company purchase his or her Shares.
The Participant's Award Agreement shall state the extent to which
the Participant may exercise the put right relating to any Stock
Options, Restricted Stock Awards, or Performance Shares that have
not vested at the time of termination of employment.

A-21
<PAGE>

If the Participant makes a request that the Company purchase the shares
within the required 45 days, then the Company shall purchase the shares.
If, within the required 45 days, the Participant fails to request that the
Company purchase the shares, the Participant loses his or her right to sell
the shares to the Company under the Plan (the Participant will retain all
rights of resale available to shareowners generally).

(v) Death or Disability. If a Participant's employment terminates because of
death or disability of the Participant, the following shall apply:

(a) For Shares owned outright (i.e. not subject to any restrictions under
Articles 6, 8 or 9): the Participant's legal representative has
one (1) year from the date of death or disability to request that
the Company purchase these Shares.

(b) Restricted Stock and Performance Shares that have not yet vested: the
Participant's legal representative has one (1) year from the date
of exercise of the grant and/or receipt of these Shares to request
that the Company purchase these Shares.

If the Participant's legal representative makes a request that the Company
purchase the shares within the required one (1) year, then the Company
shall purchase the shares. If, within the required year, the Participant's
legal representative fails to request that the Company purchase the shares,
the Participant's legal representative loses his or her right to sell the
shares to the Company under the Plan (the Participant's legal
representative will retain all rights of resale available to shareowners
generally).

(f) Limitations. Only Participant's under the Plan shall be permitted to
exercise any rights under this subsection.

The put right may not be exercised as to any Shares that have been held by
the Participant for more than five (5) years.

Notwithstanding anything in this Section to the contrary, no Participant may
exercise his or her rights under this Section to the extent that applicable
laws or regulations prohibit such rights or exercise, or to the extent that
the Company is prohibited by applicable laws or regulations from effecting the
purchase. A Participant may not sell or grant his or her put option to any
other person, except in the event of the death or disability of a Participant,
in which case the legal representative of the Participant's estate shall be
permitted to exercise all rights under this subsection as described below.

A-22
<PAGE>

ANNEX B

Proposed Amendment to the
Memorandum of Association

It is proposed to alter the Memorandum of Association of the Company as
follows:

To delete the existing paragraph 5 and substitute the following:

"5. The minimum share capital of the Company shall be US$370,000 fully paid,
divided into shares of ten cents each."
<PAGE>

Letter of Instruction to Execute Proxy for Annual General Meeting of
Shareowners--August 9, 2000
OVERSEAS PARTNERS LTD.
This Letter of Instruction is Solicited on Behalf of the Board of Directors

FIRST UNION NATIONAL BANK
Corporate Trust Operations
P.O. Box 41784
Philadelphia, PA 19101-1784
In connection with the annual general meeting of shareowners of OVERSEAS
PARTNERS LTD. (the "Company") to be held at the Company's offices in Hamilton,
Bermuda on August 9, 2000 at 9:00 A.M. and at any or all adjournments thereof,
you are hereby instructed and directed to deliver a proxy to D. Scott Davis,
Robert J. Clanin and Joseph M. Pyne, or any of them, with power of
substitution, instructing and authorizing them to vote all shares which you
are holding in custody for the undersigned as of May 30, 2000.
1. ELECTION OF DIRECTORS:
FOR [_] AGAINST [_] ABSTAIN [_]
One board seat to be vacant until filled at the
discretion of the Board
FOR [_] WITHOLDING AUTHORITY [_]
The Nominees listed below (except as marked to the
contrary below)
Robert J. Clanin, D. Scott Davis, Mary R. Hennessy, Joseph M. Pyne,
Cyril E. Rance
To withhold authority to vote for any individual nominees, write that
nominee's name in the space provided:
-------------------------------------------------------------------------------
2. FOR [_] AGAINST [_] ABSTAIN [_]
Appointment of Deloitte & Touche as auditors of the Company
for the year ended December 31, 2000.
3. FOR [_] AGAINST [_] ABSTAIN [_]
Adoption of the Overseas Partners Ltd. Incentive Compensation
Plan
4. FOR [_] AGAINST [_] ABSTAIN [_]
Memorandum of Association amendment increasing the Company's
minimum share capital to $370,000
5. In their discretion upon such other matters as may properly come before the
meeting or any adjournment thereof.
The shares of the Company to which this Letter of Instruction relates shall be
voted in the manner directed herein by the undersigned when this Letter has
been properly executed. If no direction is made, such shares will be voted FOR
proposals 1, 2, 3, 4, and 5.
Dated this day of , 2000.

_______________________________________________
SIGNATURE (sign exactly as name appears hereon)

____________________________________________________
SIGNATURE OF CO-OWNER IF ANY
For joint accounts, all co-owners must sign.
Executors, administrators, trustees, etc. should so
indicate when signing.

-------------------------------------------------------------------------------
FOLD AND DETACH HERE

[LOGO OF OVERSEAS PARTNERS LTD.]
<PAGE>

OVERSEAS PARTNERS LTD.
This Proxy is Solicited on Behalf of the Board of Directors
Proxy for Annual Meeting of Shareowners -- August 9, 2000
The undersigned hereby appoints D. Scott Davis, Robert J. Clanin and Joseph
M. Pyne, or any of them, with power of substitution, as attorneys and proxies
to vote all of the shares of stock standing in the name of the undersigned as
of May 30, 2000 at the Annual General Meeting of Shareowners of OVERSEAS
PARTNERS LTD. ("OPL" or the "Company"), to be held at the Company's offices in
Hamilton, Bermuda on August 9, 2000 at 9:00 A.M., and at any or all
adjournments thereof, the undersigned hereby instructs and authorizes said
attorneys to vote:
1. ELECTION OF DIRECTORS:
FOR [_] AGAINST [_] ABSTAIN [_]
One board seat to be vacant until
filled at the discretion of the
Board
FOR [_] WITHOLDING AUTHORITY [_]
The Nominees listed below (except
as marked to the contrary below)
Robert J. Clanin, D. Scott Davis, Mary R. Hennessy, Joseph M. Pyne, Cyril E.
Rance

INSTRUCTION: to withhold authority to vote for any individual nominees, write
that nominee's name in the space provided below.
--------------------------------------------------------------------------------
2. FOR [_] AGAINST [_] ABSTAIN [_]
Appointment of Deloitte & Touche as auditors of the
Company for the year ended December 31, 2000.
3. FOR [_] AGAINST [_] ABSTAIN [_]
Adoption of the Overseas Partners Ltd. Incentive
Compensation Plan
4. FOR [_] AGAINST [_] ABSTAIN [_]
Memorandum of Association amendment increasing the
Company's minimum share capital to $370,000
5. In their discretion upon such other matters as may properly come before the
meeting or any adjournment thereof.
This proxy when properly executed
will be voted in the manner
directed herein by the undersigned
shareowner. If no direction is
made, this proxy will be voted FOR
the Election of Directors and FOR
Proposals 2, 3, 4 and 5.
Dated this day of
, 2000.
___________________________________
SIGNATURE (sign exactly as name
appears hereon)
___________________________________
SIGNATURE OF CO-OWNER IF ANY
For joint accounts, all co-owners
must sign. Executors,
administrators, trustees, etc.
should so indicate when signing.