RE

EXHIBIT 3.2

B Y E - L A W S

of

EVEREST REINSURANCE GROUP, LTD.

(as amended September ___, 1999)
<PAGE>

TABLE OF CONTENTS

<TABLE>
<S> <C>
1. INTERPRETATION.................................................... 1

BOARD OF DIRECTORS

2. Board of Directors................................................ 5
3. Management of the Company......................................... 5
4. Power to Appoint Managing Director or Chief Executive Officer..... 6
5. Power to Appoint Manager.......................................... 6
6. Power to Authorise Specific Actions............................... 6
7. Power to Appoint Attorney......................................... 6
8. Power to Delegate to a Committee.................................. 7
9. Power to Appoint and Dismiss Employees............................ 8
10. Power to Borrow and Charge Property............................... 8

DIRECTORS


11. Election of Directors............................................. 8
12. Nominations Proposed by Members................................... 9
13. Defects in Appointment of Directors............................... 9
14. Alternate Directors............................................... 9
15. Removal of Directors.............................................. 10
16. Vacancies on the Board............................................ 10
17. Notice of Meetings of the Board................................... 11
18. Quorum at Meetings of the Board................................... 11
19. Meetings of the Board............................................. 11
20. Unanimous Written Resolutions..................................... 12
21. Contracts and Disclosure of Directors' Interests.................. 12
22. Remuneration of Directors......................................... 12

OFFICERS


23. Officers of the Company........................................... 13
24. Appointment of Officers........................................... 13
25. Remuneration of Officers.......................................... 13
26. Duties of Officers................................................ 13
27. Chairman of Meetings.............................................. 13
28. Register of Directors and Officers................................ 13
29. Obligations of Board to Keep Minutes.............................. 14
</TABLE>

i
<PAGE>

INDEMNITY
<TABLE>
<S> <C>
30. Indemnification of Directors and Officers of the Company.......... 14
31. Waiver of Claim by Member......................................... 15

MEETINGS

32. Notice of Annual General Meeting.................................. 16
33. Notice of Special General Meeting................................. 16
34. Accidental Omission of Notice of General Meeting.................. 16
35. Meeting Called on Requisition of Members.......................... 16
36. Short Notice...................................................... 17
37. Postponement of Meetings.......................................... 17
38. Quorum for General Meeting........................................ 17
39. Adjournment of Meetings........................................... 17
40. Attendance at Meetings............................................ 17
41. Written Resolutions............................................... 18
42. Attendance of Directors........................................... 18
43. Voting at Meetings................................................ 19
44. Voting on Show of Hands........................................... 19
45. Decision of Chairman.............................................. 19
46. Demand for a Poll................................................. 19
47. Seniority of Joint Holders Voting................................. 20
48. Instrument of Proxy............................................... 20
49. Representation of Corporations at Meetings........................ 22

SHARE CAPITAL AND SHARES

50. Authorisation of Shares........................................... 22
51. Limitation on Voting Rights of Controlled Shares.................. 23
52. Limitations on Power to Issue Shares.............................. 24
53. Variation of Rights and Alteration of Share Capital............... 25
54. Repurchase of Shares by Company................................... 25
55. Registered Holder of Shares....................................... 27
56. Death of a Joint Holder........................................... 27
57. Share Certificates................................................ 27

REGISTER OF MEMBERS

58. Contents of Register of Members................................... 28
59. Inspection of Register of Members................................. 28
60. Setting of Record Date............................................ 28
</TABLE>

ii
<PAGE>

TRANSFER OF SHARES
<TABLE>
<S> <C>
61. Instrument of Transfer............................................ 29
62. Restrictions on Transfer.......................................... 29
63. Transfers by Joint Holders........................................ 30

TRANSMISSION OF SHARES

64. Representative of Deceased Member................................. 30
65. Registration on Death or Bankruptcy............................... 31
66. Registration Fees................................................. 31

DIVIDENDS AND OTHER DISTRIBUTIONS

67. Declaration of Dividends by the Board............................. 31
68. Other Distributions............................................... 31
69. Reserve Fund...................................................... 31
70. Deduction of Amounts Due to the Company........................... 32
71. Unclaimed Dividends............................................... 32
72. Interest on Dividend.............................................. 32
73. Capitalization.................................................... 32

ACCOUNTS AND FINANCIAL STATEMENTS

74. Records of Account................................................ 32
75. Financial Year End................................................ 33
76. Financial Statements.............................................. 33

AUDIT

77. Appointment of Auditor............................................ 33
78. Remuneration of Auditor........................................... 33
79. Vacation of Office of Auditor..................................... 33
80. Access to Books of the Company.................................... 33
81. Report of the Auditor............................................. 34
82. Benefits.......................................................... 34
83. Insurance......................................................... 34
84. Limitation on Accountability...................................... 35

NOTICES

85. Notices to Members of the Company................................. 35
86. Notices to Joint Members.......................................... 35
87. Service and Delivery of Notice.................................... 35
</TABLE>

iii
<PAGE>

REGISTERED OFFICE
<TABLE>
<S> <C>
88. Registered Office................................................. 35

SEAL OF THE COMPANY

89. The Seal.......................................................... 35
90. Manner in Which Seal Is to Be Affixed............................. 36
91. Destruction of Documents.......................................... 36
92. Sale of Shares.................................................... 37
93. Instrument of Transfer............................................ 37
94. Proceeds of Sale.................................................. 38
95. Determination to Liquidate........................................ 38
96. Winding-up/distribution by Liquidator............................. 38

ALTERATION OF BYE-LAWS

97. Alteration of Bye-laws............................................ 38
</TABLE>
<PAGE>

BYE-LAWS

OF

EVEREST REINSURANCE GROUP, LTD.

(as amended September __, 1999)


INTERPRETATION
--------------

1. Interpretation
--------------

(a) In these Bye-laws the following words and expressions shall, where not
inconsistent with the context, have the following meanings respectively:

(i) "Act" means the Companies Act 1981 of Bermuda, as amended, or
any Bermuda statute then in effect that has replaced such
statute, and any reference in these Bye-laws to a provision of
the Act means such provision as amended from time to time or
any provision of a Bermuda law from time to time in effect that
has replaced such provision;

(ii) "Alternate Director" means an alternate Director appointed in
accordance with these Bye-laws;

(iii) "Auditor" includes any individual, company or partnership;

(iv) "Board" means the Board of Directors appointed or elected
pursuant to these Bye-laws and acting by resolution in
accordance with the Act and these Bye-laws or the Directors
present at a meeting of Directors at which there is a quorum;

(v) "Business Day" means any day, other than a Saturday, a Sunday
or any day on which banks in Hamilton, Bermuda or the City of
New York, United States are authorised or obligated by law or
executive order to close;

(vi) "Code" means the United States Internal Revenue Code of 1986,
as amended, or any United States federal statute then in effect
that has replaced such statute, and any reference in these Bye-
laws to a provision of the Code or a rule or regulation
promulgated thereunder means such provision, rule or regulation
as amended from time to time or any provision of a United
States federal law, or any United States federal rule or
regulation, from time to time in effect that has replaced such
provision, rule or regulation;

1
<PAGE>

(vii) "Common Shares" means the common shares, initially having a par
value U.S. $0.01 per share, of the Company and includes a
fraction of a Common Share;

(viii) "Company" means the company for which these Bye-laws are
approved and confirmed;

(ix) "Controlled Shares" of any Person means all shares of the
issued and outstanding share capital of the Company owned by
such Person, whether:

(A) directly;

(B) with respect to Persons who are U.S. Persons, by
application of the attribution and constructive ownership
rules of Sections 958(a) and 958(b) of the Code;

(C) with respect to Persons who are U.S. Persons, by
application of the attribution and constructive ownership
rules of Sections 544 and 554 of the Code; or

(D) beneficially, directly or indirectly, within the meaning
of Section 13(d)(3) of the Exchange Act and the rules and
regulations thereunder;

(x) "Director" means a director of the Company and shall include an
Alternate Director;

(xi) "Exchange Act" means the United States Securities Exchange Act
of 1934, as amended, or any United States federal statute from
time to time in effect that has replaced such statute, and any
reference in these Bye-laws to a provision of the Exchange Act
or a rule or regulation promulgated thereunder means such
provision, rule or regulation as amended from time to time or
any provision of a United States federal law, or any United
States federal rule or regulation, from time to time in effect
that has replaced such provision, rule or regulation;

(xii) "Fair Market Value" means, with respect to a redemption or
purchase of any shares of the Company in accordance with these
Bye-laws, (A) if such shares are listed on a securities
exchange (or quoted in a securities quotation system), the
average of the high and low sale (or bid) prices of such shares
on such exchange (or in such quotation system), or, if such
shares are listed on (or quoted in) more than one exchange (or
quotation system), the average of the high and low sale (or
bid) prices of the shares on the principal securities exchange
(or quotation system) on which such shares are then traded, or,
if such shares are not then listed on a securities exchange (or
quotation system) but are traded in the over-the-counter

2
<PAGE>

market, the average of the latest bid and asked quotations for
such shares in such market, in each case for the last 15
trading days immediately preceding the day on which notice of
the redemption or purchase of such shares is sent pursuant to
these Bye-laws or (B) if no such sales (or bid) prices or
quotations are available because such shares are not publicly
traded or otherwise, the fair value of such shares as
determined by one independent nationally recognized investment
banking firm chosen by the Company and reasonably satisfactory
to the Member whose shares are to be so repurchased by the
Company, provided, that the calculation of the Fair Market
--------
Value of the shares made by such appointed investment banking
firm (x) shall not include any discount relating to the absence
of a public trading market for, or any transfer restrictions
on, such shares and (y) such calculation shall be final and the
fees and expenses stemming from such calculation shall be borne
by the Company or its assignee, as the case may be;

(xiii) "Investment Company" means a registered investment company
pursuant to the Investment Company Act;

(xiv) "Investment Company Act" means the United States Investment
Company Act of 1940, as amended from time to time, or any
federal statute from time to time in effect that has replaced
such statute, and any reference in these Bye-laws to a
provision of the Investment Company Act or a rule or regulation
promulgated thereunder means such provision, rule or regulation
as amended from time to time or any provision of a federal law,
or any federal rule or regulation, from time to time in effect
that has replaced such provision, rule or regulation;

(xv) "Maximum Percentage" means, with respect to any Person, nine
and nine-tenths percent (9.9%) or, if applicable, such other
percentage as the Board shall have previously approved for such
Person in accordance with these Bye-laws;

(xvi) "Member" means the Person registered in the Register of Members
as the holder of shares in the Company and, when two or more
Persons are so registered as joint holders of shares, means the
Person whose name stands first in the Register of Members as
one of such joint holders or all of such Persons as the context
so requires;

(xvii) "notice" means written notice as further defined in these Bye-
laws unless otherwise specifically stated;

(xviii) "Officer" means any individual appointed by the Board to hold
an office in the Company;

3
<PAGE>

(xix) "Person" means an individual, trust, estate, partnership,
association, company, corporation, firm or other legal entity;

(xx) "Preferred Shares" means the preferred shares, initially having
a par value U.S. $0.01 per share, of the Company and includes a
fraction of a Preferred Share;

(xxi) "Register of Directors and Officers" means the Register of
Directors and Officers referred to in Bye-law 28;

(xxii) "Register of Members" means the Register of Members referred to
in Bye-law 58; and

(xxiii) "Repurchase Price" means the Fair Market Value of the shares to
be redeemed or purchased on the date the Repurchase Notice (as
defined in paragraph (b) of Bye-law 54) with respect thereto is
sent by the Company;

(xxiv) "Secretary" means the individual appointed to perform any or
all the duties of secretary of the Company and includes any
deputy, assistant or acting secretary;

(xxv) "Securities Act" means the United States Securities Act of
1933, as amended, or any United States federal statute from
time to time in effect which has replaced such statute, and any
reference in these Bye-laws to a provision of the Securities
Act or a rule or regulation promulgated thereunder means such
provision, rule or regulation as amended from time to time or
any provision of a United States federal law, or any United
States federal rule or regulation, from time to time in effect
that has replaced such provision, rule or regulation;

(xxvi) "Share" means any share in the share capital of the Company;

(xxvii) "United States" means the United States of America and
dependent territories or any part thereof;

(xxviii) "U.S. Person" means, except as otherwise indicated, an
individual who is a citizen or resident of the United States, a
corporation, partnership or other entity created or organized
in the United States or under the laws of the United States or
any political subdivision thereof, an estate whose income is
includable in gross income for United States federal income tax
purposes, regardless of its source, or a trust, if and only if
(A) a court within the United States is able to exercise
primary supervision over the administration of the trust and
(B) one or more U.S. Persons have the authority to control all
substantial decisions of the trust;

(b) In these Bye-laws, where not inconsistent with the context:

4
<PAGE>

(i) words denoting the plural number include the singular number and
vice versa;

(ii) words denoting the masculine gender include the feminine gender;


(iii) the word:

(A) "may" shall be construed as permissive;

(B) "shall" shall be construed as imperative; and

(iv) unless otherwise provided herein words or expressions defined in
the Act shall bear the same meaning in these Bye-laws.

(c) Expressions referring to writing or written shall, unless the contrary
intention appears, include facsimile, printing, lithography, photography,
electronic mail and other modes of representing words in a legible and non-
transitory form.

(d) Headings used in these Bye-laws are for convenience only and are not
to be used or relied upon in the construction hereof.

(e) In these Bye-laws, (i) powers of delegation shall not be restrictively
construed but the widest interpretation shall be given thereto, (ii) the word
"Board" in the context of the exercise of any power contained in these Bye-laws
includes any committee consisting of one or more individuals appointed by the
Board, any Director holding executive office and any local or divisional Board,
manager or agent of the Company to which or, as the case may be, to whom the
power in question has been delegated in accordance with the Act and these Bye-
laws, (iii) no power of delegation shall be limited by the existence of any
other power of delegation and (iv) except where expressly provided by the terms
of delegation, the delegation of a power shall not exclude the concurrent
exercise of that power by any Person who is for the time being authorised to
exercise it under these Bye-laws or under another delegation of the powers.

BOARD OF DIRECTORS
------------------

2. Board of Directors
------------------

The business of the Company shall be managed and conducted by the Board.

3. Management of the Company
-------------------------

(a) In managing the business of the Company, the Board may exercise all
such powers of the Company as are not, by statute or by these Bye-laws, required
to be exercised by the Company in general meeting subject, nevertheless, to
these Bye-laws and the provisions of any statute.

5
<PAGE>

(b) No regulation or alteration to these Bye-laws made by the Company in
general meeting shall invalidate any prior act of the Board which would have
been valid if that regulation or alteration had not been made.

(c) Subject to Section 39 of the Act, the Board may procure that the
Company pays to Members or third parties all expenses incurred in promoting and
incorporating the Company.

(d) The Board may exercise all the powers of the Company to discontinue
the Company to a named country or jurisdiction outside Bermuda pursuant to
Section 132G of the Act.

4. Power to appoint managing director or chief executive officer
-------------------------------------------------------------

The Board may from time to time appoint one or more Directors to the office
of managing director or chief executive officer of the Company who shall,
subject to the control of the Board, supervise and administer all of the general
business and affairs of the Company.

5. Power to appoint manager
------------------------

Without limiting the provisions of Bye-law 4, the Board may appoint an
individual, a company or a firm to act as manager of all or some of the
Company's day to day business and may entrust to and confer upon such manager
such powers and duties as it deems appropriate for the transaction or conduct of
such business.

6. Power to authorise specific actions
-----------------------------------

The Board may from time to time and at any time authorise any Director,
Officer or other Person or body of Persons to act on behalf of the Company for
any specific purpose and in connection therewith to execute any agreement,
document or instrument on behalf of the Company.

7. Power to appoint attorney
-------------------------

The Board may from time to time and at any time by power of attorney
appoint any Person or body of Persons, whether nominated directly or indirectly
by the Board, to be an attorney of the Company for such purposes and with such
powers, authorities and discretions (not exceeding those vested in or
exercisable by the Board) and for such period and subject to such conditions as
it may think fit and any such power of attorney may contain such provisions for
the protection and convenience of persons dealing with any such attorney as the
Board may think fit and may also authorise any such attorney to sub-delegate all
or any of the powers, authorities and discretions so vested in the attorney.
Such attorney may, if so authorised under the seal of the Company, execute any
deed or instrument under such attorney's personal seal with the same effect as
the affixation of the seal of the Company.

6
<PAGE>

8. Power to delegate to a committee
--------------------------------

The Board may delegate any of its powers to a committee of one or more
individuals appointed by the Board, which committee may consist partly or
entirely of non-Directors and every such committee shall conform to such
directions as the Board shall impose on them. Without limiting the foregoing,
such committees may include:

(a) an Executive Committee, which shall have all of the powers of the
Board between meetings of the Board;

(b) an Underwriting Committee, which shall, among other things, establish,
review and monitor the underwriting policies of the Company's subsidiary
companies or other companies associated with the Company, review underwriting
decisions, monitor any appointed underwriting services provider, advise the
Board with respect to actuarial services, review actuarial decisions, monitor
any provider of actuarial services and otherwise monitor the risks insured by
the Company's subsidiary companies or other companies associated with the
Company;

(c) an Investment Committee, which shall, among other things, establish,
review and monitor the investment policies of the Company and the Company's
subsidiary companies or other companies associated with the Company, review
investment decisions and review and monitor any provider of investment services;

(d) an Audit Committee, which shall, among other things, review the
internal administrative and accounting controls of the Company and the Company's
subsidiary companies or other companies associated with the Company and
recommend to the Board the appointment of independent auditors;

(e) a Compensation Committee, which shall, among other things, establish
and review the compensation policies and procedures of the Company and the
Company's subsidiary companies or other companies associated with the Company
and make recommendations to the Board with respect to compensation of Officers;
and

(f) a Nominating Committee, which shall, among other things, propose to
the Members or to continuing Directors, before any election of Directors by
Members or the filling of any vacancy by the Board, a slate of director
candidates equal in number to the vacancies to be filled (for purposes of
paragraph (f) of this Bye-law 8 only, "Director" shall not include Alternate
Director).

All Board committees shall conform to such directions as the Board shall
impose on them; provided, that each member shall have one vote, and each
--------
committee shall have the right as it deems appropriate to retain outside
advisors and experts. Each committee may adopt rules for the conduct of its
affairs, including rules governing the adoption of resolutions by unanimous
written consent, and the place, time, and notice of meetings, as shall be
advisable and as shall not be inconsistent with these Bye-laws regarding Board
meetings or with any applicable resolution adopted by the Board. Each committee
shall cause minutes to be made of all meetings of such committee and of the

7
<PAGE>

attendance thereat and shall cause such minutes and copies of resolutions
adopted by unanimous consent to be promptly inscribed or incorporated by the
Secretary in the minute book.

9. Power to appoint and dismiss employees
--------------------------------------

The Board may appoint, suspend or remove any Officer, manager, secretary,
clerk, agent or employee of the Company and may fix their remuneration and
determine their duties.

10. Power to borrow and charge property
-----------------------------------

The Board may exercise all the powers of the Company to borrow money, to
assume, guarantee or otherwise become directly or indirectly liable for
indebtedness for borrowed money and to mortgage or charge its undertaking,
property and uncalled capital, or any part thereof, and may issue debentures,
debenture stock and other securities whether outright or as security for any
debt, liability or obligation of the Company or any third party.

DIRECTORS
---------

11. Election of Directors
---------------------

(a) The Board shall consist of not less than three and not more than 12
Directors, the exact number to be determined from time to time by resolution
adopted by the affirmative vote of more than fifty percent (50%) of the
Directors then in office; provided, that if no such resolution shall be in
--------
effect the number of Directors shall be six. Each Director shall be elected,
except in the case of casual vacancy, by the Members in the manner set forth in
paragraph (b) of this Bye-law 11 at the annual general meeting or any special
general meeting called for the purpose and who shall hold office for the term
set forth in paragraph (c) of this Bye-law 11.

(b) No individual shall, unless recommended for election by the Board or
any Nominating Committee of the Board, be eligible for election as a Director
unless advance notice of the nomination of such individual shall have been given
to the Company in the manner provided in Bye-law 12.

(c) The Board shall be divided into three classes of Directors, namely
Class 1, Class 2 and Class 3, each class to have approximately the same number
of Directors as determined by the Board or any Nominating Committee of the
Board. The initial term of the Class 1 Directors shall expire at the first
annual meeting of the Company's shareholders following the date that the Company
is subject to the reporting requirements of the Exchange Act. The initial term
of the Class II Directors shall expire at the second annual meeting following
the date that the Company is subject to the reporting requirements of the
Exchange Act. The initial term of the Class III Directors shall expire at the
third annual meeting following the date that the Company is subject to the
reporting requirements of the Exchange Act. Following their initial terms, all
classes of Directors shall be elected to three-year terms. Each Director shall
serve until the expiration of such Director's term or until such Director's
successor shall have been duly elected or appointed or until such Director's
office is otherwise vacated.

8
<PAGE>

(d) For the purposes of this Bye-law 11 only, "Director" shall not include
an Alternate Director.

12. Nominations proposed by Members
-------------------------------

(a) If a Member desires to nominate one or more individuals for election
as Directors at any general meeting duly called for the election of Directors,
written notice of such Member's intent to make such a nomination must be
received by the Secretary at the registered office of the Company not less than
120 days nor more than 150 days before the first anniversary of the date of the
notice convening the Company's annual general meeting of shareholders for the
prior year. Such notice shall set forth (i) the name and address, as it appears
in the Register of Members, of the Member who intends to make such nomination;
(ii) a representation that the Member is a holder of record of shares of the
Company entitled to vote at such meeting and intends to appear in person or by
proxy at the meeting to make such nomination; (iii) the class and number of
shares of the Company which are held by the Member; (iv) the name and address of
each individual to be nominated; (v) a description of all arrangements or
understandings between the Member and any such nominee and any other person or
persons (naming such person or persons) pursuant to which such nomination is to
be made by the Member; (vi) such other information regarding any such nominee
proposed by such Member as would be required to be included in a proxy statement
filed pursuant to Regulation 14A under the Exchange Act, whether or not the
Company is then subject to such Regulation; and (vii) the consent of any such
nominee to serve as a Director, if so elected. The chairman of such general
meeting shall, if the facts warrant, refuse to acknowledge a nomination that is
not made in compliance with the procedure specified in this Bye-law 12, and any
such nomination not properly brought before the meeting shall not be considered.

13. Defects in appointment of Directors
-----------------------------------

All acts done bona fide by any meeting of the Board or by a committee of
the Board or by any individual acting as a Director shall, notwithstanding that
it be afterwards discovered that there was some defect in the appointment of any
Director or individual acting as aforesaid, or that they or any of them were
disqualified, be as valid as if every such individual had been duly appointed
and was qualified to be a Director.

14. Alternate Directors
-------------------

(a) Any Director may appoint an individual or individuals to act as a
Director in the alternative to himself or herself by notice in writing deposited
with the Secretary. Any individual so appointed shall have all the rights and
powers of the Director or Directors for whom such individual is appointed in the
alternative; provided, that such individual shall not be counted more than once
--------
in determining whether or not a quorum is present. Any Director may, upon notice
to the Secretary, remove or replace any individual so appointed as his or her
alternate with or without cause.

(b) An Alternate Director shall be entitled to receive notice of all
meetings of the Board and to attend and vote at any such meeting at which a
Director for whom such Alternate Director was

9
<PAGE>

appointed in the alternative is not personally present and generally to perform
at such meeting all the functions of such Director for whom such Alternate
Director was appointed.

(c) An Alternate Director shall be entitled to receive any proposed
written resolutions being circulated among the Directors for signature and an
Alternate Director may sign any written resolution in the absence of a Director
for whom such Alternate Director was appointed.

(d) An Alternate Director shall cease to be such if the Director for whom
such Alternate Director was appointed ceases for any reason to be a Director but
may be re-appointed as an alternate to the individual appointed to fill the
vacancy in accordance with these Bye-laws.

15. Removal of Directors
--------------------

(a) The Members shall not be entitled to remove a Director other than for
cause.

(b) Subject to any provision to the contrary in these Bye-laws, the
Members may, at any special general meeting convened for that purpose and held
in accordance with these Bye-laws, remove any Director for cause with the
sanction of a resolution passed by the holders of not less than sixty-six and
two-thirds percent (66 %) of the issued and outstanding Shares conferring the
right to vote; provided, that (i) the notice of any such meeting convened for
--------
the purpose of removing a Director shall contain a statement of the intention so
to do and be served on such Director not less than 14 days before the meeting
and (ii) at such meeting such Director shall be entitled to be heard on the
motion for such Director's removal.

(c) A vacancy on the Board created by the removal of a Director under the
provisions of paragraph (a) of this Bye-law 15 may be filled by the Members at
the meeting at which such Director is removed and, in the absence of such
appointment, the Board may fill any such vacancy in accordance with Bye-law 16.
A Director so appointed shall hold office for the balance of the term of such
vacant Board position, or until such Director's successor is elected or
appointed or such Director's office is otherwise vacated.

16. Vacancies on the Board
-----------------------

(a) The Board shall have the power from time to time and at any time to
appoint any individual as a Director to fill a vacancy on the Board occurring as
the result of the death, disability, disqualification, resignation or removal of
any Director or if such Director's office is otherwise vacated and to appoint an
Alternate Director to any Director so appointed. A Director so appointed shall
hold office for the balance of the term of such vacant Board position or until
such Director's successor is elected or appointed or such Director's office is
otherwise vacated.

(b) The Board may act notwithstanding any vacancy in its number but, if
and so long as its number is reduced below the number fixed by these Bye-laws as
the minimum number necessary for the transaction of business at meetings of the
Board, the continuing Directors or Director may, notwithstanding that the number
of Directors is below the number fixed by or in accordance with these Bye-laws
as the quorum or that there is only one continuing Director, act for the purpose
of

10
<PAGE>

(i) filling vacancies on the Board, (ii) summoning a general meeting of the
Company or (iii) preserving the assets of the Company, but not for any other
purpose.

(c) The office of Director shall be vacated if the Director:

(i) is removed from office pursuant to these Bye-laws or is
prohibited from being a Director by law;

(ii) is or becomes bankrupt or makes any arrangement or composition
with his creditors generally;

(iii) is or becomes of unsound mind as determined by the Board in its
sole discretion or dies;

(iv) resigns his or her office by notice in writing to the Company.

17. Notice of meetings of the Board
-------------------------------

(a) The Chairman or Deputy Chairman, or any two Directors may, and the
Secretary on the requisition of the Chairman, Deputy Chairman or any two
Directors shall, at any time summon a meeting of the Board by not less than
three (3) Business Days' notice in writing to each Director and Alternate
Director, unless such Director or Alternate Director consents to shorter notice.

(b) Notice of a meeting of the Board shall specify the general nature of
the business to be considered at such meeting and shall be deemed to be duly
given to a Director if it is given to such Director in person or otherwise
communicated or sent to such Director by mail, courier service, cable, telex,
telecopier, facsimile, electronic-mail or other mode of representing words in a
legible and non-transitory form at such Director's address in the Register of
Directors and Officers or any other address given by such Director to the
Company for this purpose. If such notice is sent by next-day courier, cable,
telex, telecopier, facsimile or electronic-mail it shall be deemed to have been
given the Business Day following the sending thereof and, if by registered mail,
three Business Days following the sending thereof.

(c) Meetings of the Board may be held within or outside of Bermuda and
shall be held outside of the United States.

18. Quorum at meetings of the Board
--------------------------------

The quorum necessary for the transaction of business at a meeting of the
Board shall be a majority of the Directors then in office, present in person or
represented by proxy.

19. Meetings of the Board
---------------------

11
<PAGE>

(a) The Board may meet for the transaction of business, adjourn and
otherwise regulate its meetings as it sees fit.

(b) Directors may participate in any meeting of the Board by means of such
telephone, electronic or other communication facilities as permit all persons
participating in the meeting to communicate with each other simultaneously and
instantaneously, and participation in such a meeting shall constitute presence
in person at such meeting.

(c) A resolution put to the vote at a duly constituted meeting of the
Board at which a quorum is present and acting throughout shall be carried by the
affirmative votes of a majority of the votes cast. Each Director shall have one
vote on all matters put to the Board for resolution, except that in the case of
an equality of votes the Chairman, if he or she is present (and if he or she is
not present, the Deputy Chairman, if he or she is present), shall have a second
or casting vote, otherwise no Director has a second or casting vote.

20. Unanimous written resolutions
-----------------------------

A resolution in writing signed by all the Directors, which may be in
counterparts, shall be as valid as if it had been passed at a meeting of the
Board duly called and constituted, such resolution to be effective on the date
on which the last Director signs the resolution.

21. Contracts and disclosure of Directors' interests
------------------------------------------------

(a) Any Director, or any Director's firm, partner or any company with whom
any Director is associated, may act in a professional capacity for the Company
and such Director or such Director's firm, partner or such company shall be
entitled to remuneration for professional services as if such Director were not
a Director; provided, that nothing herein contained shall authorise a Director
--------
or Director's firm, partner or such company to act as Auditor of the Company.

(b) A Director who is directly or indirectly interested in a contract or
proposed contract or arrangement with the Company shall declare the nature of
such interest as required by the Act.

(c) Following a declaration being made pursuant to this Bye-law 21, and
unless disqualified by the chairman of the relevant Board meeting, a Director
may vote in respect of any contract or arrangement or proposed contract or
arrangement in which such Director is interested and may be counted in the
quorum at such meeting.

22. Remuneration of Directors
-------------------------

(a) The remuneration (if any) of the Directors shall be determined by the
Board and shall be deemed to accrue from day to day. The Directors shall also
be reimbursed for all travel, hotel and other expenses properly incurred by them
in attending and returning from meetings of the Board, any committee appointed
by the Board, general meetings of the Company, or in connection with the
business of the Company or their duties as Directors generally.

12
<PAGE>

(b) A Director may hold any other office or place of profit under the
Company (other than the office of Auditor) in conjunction with his office of
Director for such period on such terms as to remuneration and otherwise as the
Board may determine.

OFFICERS
--------

23. Officers of the Company
-----------------------

The Officers of the Company shall consist of a Chairman, a Deputy Chairman,
a Chief Executive Officer, a Secretary and such additional Officers as the Board
may from time to time determine to be necessary or advisable in the conduct of
the affairs of the Company, all of whom shall be deemed to be Officers for the
purposes of these Bye-laws. The same individual may hold two or more offices in
the Company.

24. Appointment of Officers
-----------------------

The Board shall, as soon as possible after each annual general meeting,
appoint the Chairman and the Deputy Chairman who shall be Directors. The Chief
Executive Officer, Secretary and additional Officers, if any, shall be appointed
by the Board from time to time.

25. Remuneration of Officers
------------------------

The Officers shall receive such remuneration as the Board may from time to
time determine.

26. Duties of Officers
------------------

The Officers shall have such powers and perform such duties in the
management, business and affairs of the Company as may be delegated to them by
these Bye-laws or the Board from time to time.

27. Chairman of meetings
--------------------

The Chairman shall act as chairman at all meetings of the Members and of
the Board at which such individual is present. In his or her absence, the
Deputy Chairman shall act as chairman and in the absence of both of them a
chairman shall be appointed or elected by those present at the meeting and
entitled to vote.

28. Register of Directors and Officers
----------------------------------

(a) The Board shall cause to be kept in one or more books at the
registered office of the Company a Register of Directors and Officers and shall
enter therein the particulars required by the Act.

13
<PAGE>

(b) The Register of Directors and Officers shall be open to inspection by
Members at the office of the Company in compliance with the requirements of the
Act, subject to such reasonable restrictions as the Board may impose.

MINUTES
-------

29. Obligations of Board to keep minutes
------------------------------------

(a) The Board shall cause minutes to be duly entered in books provided for
the purpose:

(i) of all elections and appointments of Officers;

(ii) of the names of the Directors present at each meeting of the
Board and of any committee appointed by the Board; and

(iii) of all resolutions and proceedings of general meetings of the
Members, meetings of the Board, meetings of managers and
meetings of committees appointed by the Board.

(b) Minutes prepared in accordance with the Act and these Bye-laws shall
be kept by the Secretary at the registered office of the Company.

INDEMNITY
---------

30. Indemnification of Directors and Officers of the Company
--------------------------------------------------------

(a) The Directors, Secretary and other Officers (such term to include for
the purposes of Bye-laws 30 and 31, any Person appointed to any committee by the
Board) and employees of the Company acting in relation to any of the affairs of
the Company and the liquidator or trustees (if any) acting in relation to any of
the affairs of the Company, and every one of them, and their heirs, executors
and administrators, shall be indemnified and secured harmless out of the assets
of the Company (and the Company, in the discretion of the Board of Directors,
may so indemnify and secure harmless a Person by reason of the fact that such
Person was an agent of the Company or was serving at the request of the Company
in any other capacity for or on behalf of the Company) from and against all
actions, costs, charges, losses, damages and expenses (including, without
limitation, attorneys' fees) which they or any of them, their heirs, executors
or administrators, shall or may incur or sustain by or by reason of any act
done, concurred in or omitted in or about the execution of their duty, or
supposed duty, or in their respective offices or trusts, including, without
limitation, any acts taken or omitted with regard to subsidiary companies of the
Company, and none of them shall be answerable for the acts, receipts, neglects
or defaults of the others of them or for joining in any receipts for the sake of
conformity, or for the acts of or the solvency or honesty of any bankers or
other persons with whom any moneys or effects belonging to the Company shall or
may be lodged or deposited for safe custody, or for insufficiency or deficiency
of any security upon which any moneys of or belonging to the Company shall be
placed out on or invested, or for any other loss,

14
<PAGE>

misfortune or damage which may happen in the execution of their respective
offices or trusts, or in relation thereto; provided, that this indemnity shall
--------
not extend to any matter prohibited by the Act.

(b) Any indemnification under this Bye-law 30, unless ordered by a court,
shall be made by the Company only as authorised in the specific case upon a
determination that indemnification of such Person is proper in the circumstances
because such Person has met the applicable standard of conduct set forth in
paragraph (a) of this Bye-law 30. Such determination shall be made (i) by the
Board by a majority vote of disinterested Directors or (ii) if a majority of the
disinterested Directors so directs, by independent legal counsel in a written
opinion or (iii) by the Members.

(c) Expenses (including, without limitation, attorneys' fees) actually and
reasonably incurred by any Director, Secretary, other Officer or employee of the
Company in defending any civil, criminal, administrative or investigative
action, suit or proceeding or threat thereof for which indemnification is sought
pursuant to paragraph (a) of this Bye-law 30 shall be paid by the Company in
advance of the final disposition of such action, suit or proceeding upon receipt
of an undertaking by or on behalf of such Person to repay such amount if it
shall be ultimately determined that such Person is not entitled to be
indemnified by the Company as authorised in these Bye-laws or otherwise pursuant
to applicable law; provided, that if it is determined by either (i) a majority
--------
vote of Directors who were not parties to such action, suit or proceeding or
(ii) if a majority of the disinterested Directors so directs, by independent
legal counsel in a written opinion, that there is no reasonable basis to believe
that such Person is entitled to be indemnified by the Company as authorised in
these Bye-laws or otherwise pursuant to applicable law, then no expense shall be
advanced in accordance with this paragraph (c) of this Bye-law 30. Such
expenses (including attorneys' fees) incurred by agents of the Company may be
paid upon the receipt of the aforesaid undertaking and such terms and
conditions, if any, as the Board deems appropriate.

(d) The indemnification and advancement of expenses provided in these Bye-
laws shall not be deemed exclusive of any other rights to which those seeking
indemnification and advancement of expenses may now or hereafter be entitled
under any statute, agreement, vote of Members or otherwise, both as to action in
an official capacity and as to action in another capacity while holding such
office.

(e) The indemnification and advancement of expenses provided by, or
granted pursuant to, this Bye-law 30 shall, unless otherwise provided when
authorised or ratified, continue as to a Person who has ceased to hold the
position for which such Person is entitled to be indemnified or advanced
expenses and shall inure to the benefit of the heirs, executors and
administrators of such a Person.

(f) No amendment or repeal of any provision of this Bye-law 30 shall
alter, to the detriment of any Person, the right of such Person to the
indemnification or advancement of expenses related to a claim based on an act or
failure to act which took place prior to such amendment, repeal or termination.

31. Waiver of claim by Member
-------------------------

15
<PAGE>

Each Member agrees to waive any claim or right of action such Member might
have, whether individually or by or in the right of the Company, against any
Director or Officer on account of any action taken by such Director or Officer,
or the failure of such Director or Officer to take any action in the performance
of his or her duties with or for the Company; provided, that such waiver shall
--------
not extend to any matter in respect of any fraud or dishonesty which may attach
to such Director or Officer.

MEETINGS
--------

32. Notice of annual general meeting
--------------------------------

The annual general meeting of the Company shall be held in each year at
such time and place as the Chairman, the Deputy Chairman or any two Directors or
any Director and the Secretary or the Board shall appoint. At least five days
written notice of such meeting shall be given to each Member stating the date,
place and time at which the meeting is to be held, that the election of
Directors will take place thereat, and as far as practicable, the other business
to be conducted at the meeting. The annual general meeting may be held within or
outside of Bermuda and shall be held outside of the United States.

33. Notice of special general meeting
---------------------------------

The Chairman, the Deputy Chairman or any two Directors or any Director and
the Secretary or the Board may convene a special general meeting of the Company
whenever in their judgment such a meeting is necessary, upon not less than five
days' written notice which shall state the date, time, place and the general
nature of the business to be considered at the meeting. Any special general
meeting may be held within or outside of Bermuda and shall be held outside of
the United States.

34. Accidental omission of notice of general meeting
------------------------------------------------

The accidental omission to give notice of a general meeting to, or the non-
receipt of notice of a general meeting by, any Person entitled to receive notice
shall not invalidate the proceedings at that meeting.

35. Meeting called on requisition of Members
----------------------------------------

Notwithstanding anything herein, the Board shall, on the requisition of
Members holding at the date of the deposit of the requisition not less than one-
tenth of such of the paid-up share capital of the Company as at the date of the
deposit carries the right to vote at general meetings of the Company, forthwith
proceed to convene a special general meeting of the Company and the provisions
of Section 74 of the Act shall apply.

16
<PAGE>

36. Short notice
-------------

A general meeting of the Company shall, notwithstanding that it is called
by shorter notice than that specified in these Bye-laws, be deemed to have been
properly called if it is so agreed by (a) all the Members entitled to attend and
vote thereat in the case of an annual general meeting; and (b) a majority in
number of the Members having the right to attend and vote at the meeting, being
a majority together holding not less than ninety-five percent (95%) in nominal
value of the shares conferring a right to attend and vote thereat in the case of
a special general meeting.

37. Postponement of meetings
------------------------

The Chairman or the Board may postpone any general meeting called in
accordance with the provisions of these Bye-laws (other than a meeting
requisitioned under Bye-law 35); provided, that notice of postponement is given
--------
to each Member before the time for such meeting. Fresh notice of the date, time
and place for the postponed meeting shall be given to each Member in accordance
with the provisions of these Bye-laws.

38. Quorum for general meeting
--------------------------

At any general meeting of the Company two or more individuals present in
person and representing in person or by proxy in excess of fifty percent (50%)
of the total issued and outstanding shares conferring a right to attend and vote
at such meeting throughout the meeting shall form a quorum for the transaction
of business; provided, that if the Company shall at any time have only one
--------
Member, one Member present in person or by proxy shall constitute a quorum for
the transaction of business at any general meeting of the Company held during
such time. If within half an hour from the time appointed for the meeting a
quorum is not present, the meeting shall stand adjourned to the same day one
week later, at the same time and place or to such other day, time or place as
the Chairman or the Board may determine. Unless the meeting is so adjourned to
a specific date and time, fresh notice of the date, time and place for the
resumption of the adjourned meeting shall be given to each Member in accordance
with the provisions of these Bye-laws. No business shall be transacted at any
general meeting unless a quorum is present when the meeting proceeds to
business and continues throughout the meeting, but the absence of a quorum shall
not preclude the appointment, choice or election of a chairman of the meeting
which shall not be treated as part of the business of the meeting.

39. Adjournment of meetings
-----------------------

The chairman of a general meeting may, with the consent of the Members at
any general meeting at which a quorum is present (and shall if so directed),
adjourn the meeting. Unless the meeting is so adjourned to a specific date and
time, fresh notice of the date, time and place for the resumption of the
adjourned meeting shall be given to each Member in accordance with the
provisions of these Bye-laws.

40. Attendance at meetings
----------------------

17
<PAGE>

Unless the Chairman or the Board determines otherwise, Members may
participate in any general meeting by means of such telephone, electronic or
other communication facilities as permit all individuals participating in the
meeting to communicate with each other simultaneously and instantaneously, and
participation in such a meeting shall constitute presence in person at such
meeting.

41. Written resolutions
-------------------

(a) Subject to paragraph (f) of this Bye-law 41, anything which may be
done by resolution of the Company in general meeting or by resolution of a
meeting of any class of the Members of the Company, may, without a meeting and
without any previous notice being required, be done by resolution in writing
signed by, or, in the case of a Member that is a corporation whether or not a
company within the meaning of the Act, on behalf of, all the Members who at the
date of the resolution or the record date (if earlier) would be entitled to
attend the meeting and vote on the resolution.

(b) A resolution in writing may be signed by, or, in the case of a Member
that is a corporation whether or not a company within the meaning of the Act, on
behalf of, all the Members, or any class thereof, in as many counterparts as may
be necessary.

(c) For the purposes of this Bye-law 41, the date of the resolution is the
date when the resolution is signed by, or, in the case of a Member that is a
corporation whether or not a company within the meaning of the Act, on behalf
of, the last Member to sign and any reference in any Bye-law to the date of
passing of a resolution is, in relation to a resolution made in accordance with
this Bye-law, a reference to such date.

(d) A resolution in writing made in accordance with this Bye-law is as
valid as if it had been passed by the Company in general meeting or by a meeting
of the relevant class of Members, as the case may be, and any reference in any
Bye-law to a meeting at which a resolution is passed or to Members voting in
favor of a resolution shall be construed accordingly.

(e) A resolution in writing made in accordance with this Bye-law shall
constitute minutes for the purposes of Sections 81 and 82 of the Act.

(f) This Bye-law shall not apply to:

(i) a resolution passed pursuant to Section 89(5) of the Act; or

(ii) a resolution passed for the purpose of removing a Director
before the expiration of his term of office under these Bye-
laws.

42. Attendance of Directors
-----------------------

The Directors of the Company shall be entitled to receive notice of and to
attend and be heard at any general meeting.

18
<PAGE>

43. Voting at meetings
------------------

Subject to the provisions of the Act and these Bye-laws, any question
proposed for the consideration of the Members at any general meeting shall be
decided by the affirmative vote of a majority of the votes cast in accordance
with the provisions of these Bye-laws and in the case of an equality of votes
the resolution shall fail.

44. Voting on show of hands
-----------------------

At any general meeting a resolution put to the vote of the meeting shall,
in the first instance, be voted upon by a show of hands and, subject to any
rights or restrictions for the time being lawfully attached to any class of
shares and subject to the provisions of these Bye-laws, every Member present in
person and every individual holding a valid proxy at such meeting shall be
entitled to one vote and shall cast such vote by raising his or her hand.

45. Decision of chairman
--------------------

At any general meeting a declaration by the chairman of the meeting that a
question proposed for consideration has, on a show of hands, been carried, or
carried unanimously, or by a particular majority, or lost, and an entry to that
effect in a book containing the minutes of the proceedings of the Company shall,
subject to the provisions of these Bye-laws, be conclusive evidence of that
fact.

46. Demand for a poll
-----------------

(a) Notwithstanding the provisions of the immediately preceding two Bye-
laws, at any general meeting of the Company, in respect of any question proposed
for the consideration of the Members (whether before or on the declaration of
the result of a show of hands as provided for in these Bye-laws), a poll may be
demanded by any of the following Persons:

(i) the chairman of such meeting; or

(ii) at least three Members present in person or represented by
proxy; or

(iii) any Member or Members present in person or represented by
proxy and holding between them not less than one-tenth (1/10)
of the total voting rights of all the Members having the right
to vote at such meeting; or

(iv) any Member or Members present in person or represented by
proxy holding shares conferring the right to attend and vote
at such meeting on which an aggregate sum has been paid up
equal to not less than one-tenth (1/10) of the total sum paid
up on all Common Shares.

(b) Where, in accordance with the provisions of paragraph (a) of this Bye-
law 46, a poll is demanded, subject to any rights or restrictions for the time
being lawfully attached to any class of shares and subject to the provisions of
these Bye-laws, every Member present in person or by

19
<PAGE>

proxy at such meeting shall have one vote for each share conferring the right to
attend and vote at such meeting of which such Member is the registered holder or
for which such a proxyholder holds a proxy and such votes shall be counted in
the manner set out in paragraph (d) of this Bye-law 46 or, in the case of a
general meeting at which one or more Members or proxyholders are present by
telephone, in such manner as the chairman of the meeting may direct, and the
result of such poll shall be deemed to be the resolution of the meeting at which
the poll was demanded and shall replace any previous resolution upon the same
matter which has been the subject of a show of hands.

(c) A poll demanded in accordance with the provisions of paragraph (a) of
this Bye-law 46, for the purpose of electing a chairman of the meeting or on a
question of adjournment, shall be taken forthwith and a poll demanded on any
other question shall be taken in such manner and at such time and place as the
chairman (or acting chairman) may direct and any business other than that upon
which a poll has been demanded may be proceeded with pending the taking of the
poll.

(d) Where a vote is taken by poll, each Member present in person or by
proxy and entitled to vote shall be furnished with a ballot on which such Member
or proxyholder shall record his or her vote in such manner as shall be
determined at the meeting having regard to the nature of the question on which
the vote is taken, and each ballot paper shall be signed or initialed or
otherwise marked so as to identify the voter and the registered holder in the
case of a proxy. The Board may appoint one or more inspectors to act at any
meeting where a vote is taken by a poll. Each inspector shall take and sign an
oath faithfully to exercise the duties of inspector at such meeting with strict
impartiality and according to the best of his, her or its ability. The
inspectors shall determine the number of shares outstanding and the voting power
of each, the number of shares represented at the meeting, the existence of a
quorum, the validity and effect of proxies and examine and count all ballots and
determine the results of any vote. The inspector shall also hear and determine
challenges and questions arising in connection with the right to vote. No
Director or candidate for the office of Director shall act as an inspector. The
determination and decision of the inspectors shall be final and binding.

47. Seniority of joint holders voting
---------------------------------

In the case of joint holders, the vote of the senior who tenders a vote,
whether in person or by proxy, shall be accepted to the exclusion of the votes
of the other joint holders, and for this purpose seniority shall be determined
by the order in which the names stand in the Register of Members.

48. Instrument of proxy
-------------------

(a) The instrument appointing a proxy shall be in writing under the hand
of the appointor or of his or her attorney authorised by him or her in writing
or, if the appointor is a corporation, either under its seal or under the hand
of an officer, attorney or other person authorised to sign the same.

(b) Any Member may appoint a standing proxy or (if a corporation)
representative by depositing at the Registered Office, or at such place or
places as the Board may otherwise specify

20
<PAGE>

for the purpose, a proxy or (if a corporation) an authorisation and such proxy
or authorisation shall be valid for all general meetings and adjournments
thereof or, resolutions in writing, as the case may be, until notice of
revocation is received at the Registered Office, or at such place or places as
the Board may otherwise specify for the purpose. Where a standing proxy or
authorisation exists, its operation shall be deemed to have been suspended at
any general meeting or adjournment thereof at which the Member is present or in
respect to which the Member has specially appointed a proxy or representative.
The Board may from time to time require such evidence as it shall deem necessary
as to the due execution and continuing validity of any such standing proxy or
authorisation and the operation of any such standing proxy or authorisation
shall be deemed to be suspended until such time as the Board determines that it
has received the requested evidence or other evidence satisfactory to it.

(c) Subject to paragraph (b) of this Bye-law 48, the instrument appointing
a proxy together with such other evidence as to its due execution as the Board
may from time to time require shall be delivered at the Registered Office (or at
such place or places as may be specified in the notice convening the meeting or
in any notice of any adjournment or, in either case or the case of a written
resolution, in any document sent therewith) not less than 24 hours or such other
period as the Board may determine, prior to the holding of the relevant meeting
or adjourned meeting at which the individual person named in the instrument
proposes to vote or, in the case of a poll taken subsequently to the date of a
meeting or adjourned meeting, before the time appointed for the taking of the
poll, or, in the case of a written resolution, prior to the effective date of
the written resolution and in default the instrument of proxy shall not be
treated as valid.

(d) Instruments of proxy shall be in any common form or other form as the
Board may approve and the Board may, if it thinks fit, send out with the notice
of any meeting or any written resolution forms of instruments of proxy for use
at that meeting or in connection with that written resolution. The instrument of
proxy shall be deemed to confer authority to demand or join in demanding a poll
and to vote on any amendment of a written resolution or amendment of a
resolution put to the meeting for which it is given as the proxy thinks fit. The
instrument of proxy shall unless the contrary is stated therein be valid as well
for any adjournment of the meeting as for the meeting to which it relates.

(e) A vote given in accordance with the terms of an instrument of proxy
shall be valid notwithstanding the previous death or unsoundness of mind of the
principal, or revocation of the instrument of proxy or of the authority under
which it was executed, provided, that no intimation in writing of such death,
--------
insanity or revocation shall have been received by the Company at the Registered
Office (or such other place as may be specified for the delivery of instruments
of proxy in the notice convening the meeting or other documents sent therewith)
at least one hour before the commencement of the meeting or adjourned meeting,
or the taking of the poll, or the day before the effective date of any written
resolution at which the instrument of proxy is used.

(f) Subject to the Act, the Board may at its discretion waive any of the
provisions of these Bye-laws related to proxies or authorisations and, in
particular, may accept such verbal or other assurances as it thinks fit as to
the right of any person to attend and vote on behalf of any Member at general
meetings or to sign written resolutions.

21
<PAGE>

49. Representation of corporations at meetings
------------------------------------------

A corporation which is a Member may, by written instrument, authorise such
individual as it thinks fit to act as its representative at any meeting of the
Members and the individual so authorised shall be entitled to exercise the same
powers on behalf of the corporation which such individual represents as that
corporation could exercise if it were an individual Member. Notwithstanding the
foregoing, the chairman of the meeting may accept such assurances as he or she
thinks fit as to the right of any individual to attend and vote at general
meetings on behalf of a corporation which is a Member.

SHARE CAPITAL AND SHARES
------------------------

50. Authorisation of shares
-----------------------

(a) Upon adoption of these Bye-laws, the share capital of the Company
shall initially be divided into two classes of shares consisting of (i) two
hundred million (200,000,000) Common Shares and (ii) fifty million (50,000,000)
Preferred Shares.

(b) Subject to the provisions of these Bye-laws, the holders of Common
Shares shall:

(i) be entitled to one vote per Common Share;

(ii) be entitled to such dividends as the Board may from time to
time declare;

(iii) in the event of a winding-up or dissolution of the Company,
whether voluntary or involuntary or for the purpose of a
reorganization or otherwise or upon any distribution of
capital, be entitled to share equally and ratably in the assets
of the Company, if any, remaining after the payment of all
debts and liabilities of the Company and the liquidation
preference of any outstanding Preferred Shares; and

(iv) generally be entitled to enjoy all of the rights attaching to
shares.

(c) Subject to these Bye-laws, the Act and to any resolution of the
Members to the contrary, the unissued share capital of the Company (as it
stands from time to time) shall be at the disposal of the Board and the Board
shall have power to issue, offer, allot, exchange or otherwise dispose of any
unissued shares of the Company, at such times, for such consideration and on
such terms and conditions as it may determine and any shares or class of shares
may be issued with such preferred, deferred or other special rights or such
restrictions, whether in regard to dividend, voting, return of capital or
otherwise as the Board may from time to time prescribe and the Board may
generally exercise the powers set out in Sections 45(1)(b), (c), (d) and (e) of
the Act. Further the Board shall have the power to issue, offer, allot,
exchange or otherwise dispose of options, warrants or other rights to purchase
or acquire shares or securities convertible into or exchangeable for shares
(including any employee benefit plan providing for the issuance of shares

22
<PAGE>

or options or rights in respect thereof), at such times, for such consideration
and on such terms and conditions as it may determine.

(d) The Board is authorised, subject to the Act, to issue the Preferred
Shares in series, at such times, for such consideration and on such terms and
conditions as it may determine, to establish from time to time the number of
Preferred Shares to be included in each such series, and to fix the designation,
powers, preferences, voting rights, dividend rates, redemption provisions and
other rights, qualifications, limitations or restrictions thereof. The terms of
any series of Preferred Shares shall be set forth in a Certificate of
Designation in the minutes of the Board authorising the issuance of such
Preferred Shares and such Certificate of Designations shall be attached as an
exhibit to these Bye-laws, but shall not form part of these Bye-laws, and may be
examined by any Member on request. The rights attaching to any Common Share
shall be deemed not to be altered by the allotment of any Preferred Share even
if such Preferred Share does or will rank in priority for payment of a dividend
or in respect of capital or which confer on the holder thereof voting rights
more favorable than those conferred by such Common Share and shall not otherwise
be deemed to be altered by the creation or issue of further shares ranking pari
passu therewith.

51. Limitation on voting rights of controlled shares
------------------------------------------------

(a) If and for so long as the aggregate number of Controlled Shares of any
Person exceeds the Maximum Percentage of the total voting power of all of the
issued and outstanding share capital of the Company (calculated after giving
effect to any prior reduction in voting rights attaching to Controlled Shares of
other Persons as provided in this Bye-law 51), each such Controlled Share,
regardless of the identity of the registered holder thereof, shall confer only a
fraction of a vote as determined by the following formula (the "Formula"):

(T - C) Divided By (9.1 x C)

Where "T" is the aggregate number of votes
conferred by all the issued and
outstanding share capital immediately
prior to that application of the
Formula with respect to any particular
Member, adjusted to take into account
any prior reduction taken with respect
to any other Member pursuant to
paragraph (b) of this Bye-law 51 as at
the same date;

"C" is the number of Controlled Shares attributable to
such Person.

(b) The Formula shall be applied successively as many times as may be
necessary to ensure that the number of Controlled Shares of any Person does not
exceed the Maximum Percentage of the total voting power of all of the issued and
outstanding share capital of the Company at any time. For the purposes of
determining the votes exercisable by Members as at any date, the Formula shall
be applied to the shares of each Member in declining order based on the
respective numbers

23
<PAGE>

of total Controlled Shares attributable to each Member. Thus, the Formula will
be applied first to the votes of shares held by the Member to whom the largest
number of total Controlled Shares is attributable and thereafter sequentially
with respect to the Member with the next largest number of total Controlled
Shares. In each case, calculations shall be made on the basis of the aggregate
number of votes conferred by the shares as of such date, as reduced by the
application of the Formula to any issued shares of any Member with a larger
number of total Controlled Shares as of such date.

(c) Notwithstanding the provisions of paragraphs (a) and (b) of this Bye-
law 51, having applied the provisions thereof as best as they consider
reasonably practicable, the Board may make such final adjustments to the
aggregate number of votes attaching to the Controlled Shares of any Member that
it considers fair and reasonable in all the circumstances to ensure that the
number of Controlled Shares of any Person does not exceed the Maximum Percentage
of the total voting power of all of the issued and outstanding share capital of
the Company at any time.

(d) Notwithstanding anything in these Bye-laws, this Bye-law 51 shall not
apply for so long as the Company shall have only one Member.

52. Limitations on the power to issue shares
----------------------------------------

(a) Notwithstanding the provisions of paragraphs (c) and (d) of Bye-law
50, no share may be issued, without the prior written approval of the Board, if
the Board has reason to believe that the effect of such issuance would cause (i)
any Person that is not an Investment Company to beneficially own, directly or
indirectly (within the meaning of Section 13(d)(3) of the Exchange Act and the
rules and regulations thereunder), in excess of five percent (5%) of any class
of issued and outstanding share capital of the Company, (ii) the aggregate
number of Controlled Shares of any Person to exceed the Maximum Percentage of
any class of issued and outstanding share capital of the Company or (iii) any
adverse tax, regulatory or legal consequences to the Company, any of its
subsidiaries or any of the Members. Notwithstanding the foregoing provisions of
this Bye-law 52, the restrictions of this paragraph (a) of this Bye-law 52 shall
not apply to any issuance of shares to a Person acting as an underwriter in the
ordinary course of its business purchasing such shares for resale pursuant to a
purchase agreement to which the Company is a party.

(b) The Board shall, in connection with the issue of any share, have the
power to pay such commissions and brokerage fees and charges as may be permitted
by law.

(c) The Company shall not give, whether directly or indirectly, whether by
means of loan, guarantee, provision of security or otherwise, any financial
assistance for the purpose of or in connection with a purchase or subscription
made or to be made by any Person of or for any shares in the Company, but
nothing in this Bye-law 52 shall prohibit transactions permitted pursuant to
Sections 39A, 39B and 39C of the Act.

(d) The Company may from time to time do any one or more of the following
things:

(i) make arrangements on the issue of shares for a difference between
the Members in the amounts and times of payments of calls on
their shares;

24
<PAGE>

(ii) accept from any Member the whole or a part of the amount
remaining unpaid on any shares held by such Member, although no
part of that amount has been called up;

(iii) pay dividends in proportion to the amount paid up on each share
where a larger amount is paid up on some shares than on others;
and

(iv) issue its shares in fractional denominations and deal with such
fractions to the same extent as its whole shares and shares in
fractional denominations shall have in proportion to the
respective fractions represented thereby all of the rights of
whole shares including (but without limiting the generality of
the foregoing) the right to vote, to receive dividends and
distributions and to participate in a winding up.

53. Variation of rights and alteration of share capital
---------------------------------------------------

(a) If at any time the share capital is divided into different classes of
shares, the rights attached to any class (unless otherwise provided by the terms
of issue of the shares of that class) may, whether or not the Company is being
wound-up, be varied with the consent in writing of the holders of not less than
a majority of the issued and outstanding shares of that class or with the
sanction of a resolution passed by the holders of not less than a majority of
the issued and outstanding shares of that class at a separate general meeting of
the holders of the shares of the class held in accordance with Section 47 (7) of
the Act. The rights conferred upon the holders of the shares of any class issued
with preferred or other rights shall not, unless otherwise expressly provided by
the terms of issue of the shares of that class, be deemed to be varied by the
creation or issue of further shares ranking pari passu therewith. The rights of
the holders of Common Shares shall not be deemed to be varied by the creation or
issue of shares with preferred or other rights, which may be effected by the
Board as provided in these Bye-laws without any vote or consent of the holders
of Common Shares.

(b) The Company may from time to time by resolution of the Members change
the currency denomination of, increase, alter or reduce its share capital in
accordance with the provisions of Sections 45 and 46 of the Act; provided, that
--------
any resolution of the Members to alter or reduce its share capital be by the
affirmative vote of Members representing not less than a majority of the votes
conferred by the issued and outstanding shares entitled to vote. Where, on any
alteration of share capital, fractions of shares or some other difficulty would
arise, the Board may deal with or resolve the same in such manner as it thinks
fit including, without limiting the generality of the foregoing, the issue to
Members, as appropriate, of fractions of shares and/or arranging for the sale or
transfer of the fractions of shares of Members to a purchaser thereof who shall
not be bound to see to the application of the purchase money, nor shall his or
her title to the same be affected by any irregularity in, or in invalidity of,
the proceedings relating to sale.

54. Repurchase of shares by Company
-------------------------------

(a) Exercise of power to redeem and purchase shares of the Company
--------------------------------------------------------------

25
<PAGE>

The Company may from time to time redeem or purchase all or any part of its
own shares pursuant to Sections 42 and 42A of the Act. The Board may, at its
discretion and without the sanction of a resolution of the Members, authorise
any redemption or purchase by the Company of its own shares (all or any part
thereof), of any class, at any price (whether at par or above or below par), and
so that any share to be so redeemed or purchased may be selected in any manner
whatsoever, upon such terms as the Board may in its discretion determine;
provided, that such redemption or purchase is effected in accordance with the
--------
provisions of the Act. The rights attaching to any share shall be deemed not to
be altered (unless such right specifically provides otherwise) by any redemption
or purchase by the Company of any of its own shares.

(b) Unilateral repurchase right
---------------------------

Subject to Section 42A of the Act, if the Board has reason to believe that
(I) any Member that is not an Investment Company beneficially owns, directly or
indirectly (within the meaning of Section 13(d)(3) of the Exchange Act and the
rules and regulations thereunder), in excess of five percent (5%) of any class
of issued and outstanding share capital of the Company, (ii) the aggregate
number of Controlled Shares of any Member exceeds the Maximum Percentage of any
class of issued and outstanding share capital of the Company or (iii) the share
ownership of any Member may result in adverse tax, regulatory or legal
consequences to the Company, any of its subsidiaries or any of the Members, the
Company shall have the option, but not the obligation, to redeem or purchase all
or any part of the shares held by such Member (to the extent the Board, in the
reasonable exercise of its discretion, determines necessary or advisable to
avoid or cure any adverse or potential adverse consequences) for the Repurchase
Price by delivering written notice to such Member specifying the number of
shares to be redeemed or purchased and the Repurchase Price therefor (the
"Repurchase Notice"). The Company shall use all commercially reasonable efforts
to exercise its redemption or purchase option ratably among similarly situated
Members to the extent possible under the circumstances. Within 10 days after
the delivery of the Repurchase Notice, the Company or its designee shall redeem
or purchase from such Member, and such Member shall sell to the Company or its
designee, the number of shares specified in the Repurchase Notice at a mutually
agreeable time and place. At such closing, the Company or its designee shall
pay to such Member the Repurchase Price by wire transfer of immediately
available funds and such Member shall deliver to the Company or its designee
share certificates representing the redeemed or purchased shares duly endorsed
in blank or accompanied by duly executed stock powers. The Company may revoke
the Repurchase Notice at any time prior to payment for the shares.

(c) Unilateral repurchase right in the event of involuntary transfer
----------------------------------------------------------------

If a Member shall be involuntarily would up, dissolved or liquidated or
shall have entered in respect of it an order for relief under the United States
Bankruptcy Code (or any similar law of any applicable jurisdiction) or shall
otherwise be required to transfer involuntarily any or all of its shares
pursuant to a court order, foreclosure, tax lien, government seizure, death or
otherwise, and, in any such case as a result thereof, any or all of such
Member's shares (the "Involuntary Transfer Shares") shall be actually or
purportedly transferred or otherwise disposed of, such Member, or its legal
representative or successor, shall promptly give notice to the Company of such
transfer and the Company shall have the option, but not the obligation, to
redeem or purchase all or any part of the

26
<PAGE>

Involuntary Transfer Shares held by such Member for the Repurchase Price by
delivering a Repurchase Notice to such Member. Within 10 days after the delivery
of the Repurchase Notice, the Company or its designee shall redeem or purchase
from such Member, and such Member shall sell to the Company or its designee, the
number of Involuntary Transfer Shares specified in the Repurchase Notice at a
mutually agreeable time and place. At such closing, the Company or its designee
shall pay to such Member the Repurchase Price by wire transfer of immediately
available funds and such Member shall deliver to the Company or its designee
share certificates representing the Involuntary Transfer Shares duly endorsed in
blank or accompanied by duly executed stock powers. The Company may revoke the
Repurchase Notice at any time prior to the payment for shares.

55. Registered holder of shares
---------------------------

(a) The Company shall be entitled to treat the registered holder of any
share as the absolute owner thereof and, accordingly, except as ordered by a
court of competent jurisdiction or as required by law or as specifically
provided in these Bye-laws, no Person shall be recognized by the Company as
holding any share upon trust and the Company shall not be bound by or required
in any way to recognize (even when having notice thereof) any equitable,
contingent, future or partial interest in any share or any interest in any
fractional part of a share or (except only as otherwise provided in these Bye-
laws or by law) any other right in respect of any share except an absolute right
to the entirety thereof in the registered holder.

(b) Any dividend, interest or other monies payable in cash in respect of
shares may be paid by cheque or draft sent through the post directed to the
Member at such Member's address in the Register of Members or, in the case of
joint holders, to such address of the holder first named in the Register of
Members, or to such Person and to such address as the holder or joint holders
may in writing direct. If two or more Persons are registered as joint holders
of any shares, any one can give an effectual receipt for any dividend paid in
respect of such shares.

56. Death of a joint holder
-----------------------

Where two or more Persons are registered as joint holders of a share or
shares, then in the event of the death of any joint holder or holders the
remaining joint holder or holders shall be absolutely entitled to the said share
or shares and the Company shall recognize no claim in respect of the estate of
any joint holder except in the case of the last survivor of such joint holders.

57. Share certificates
------------------

(a) Every Member shall be entitled to a certificate under the seal of the
Company (or a facsimile or representation thereof) specifying the number and,
where appropriate, the class of shares held by such Member and whether the same
are fully paid up and, if not, how much has been paid thereon. The Board may by
resolution determine, either generally or in a particular case, that any or all
signatures on certificates may be printed thereon or affixed by mechanical
means. Notwithstanding the provisions of Bye-law 90, the Board may determine
that a share certificate need not be signed by any individual.

27
<PAGE>

(b) The Company shall be under no obligation to complete and deliver a
share certificate unless specifically called upon to do so by the Person to whom
such shares have been allotted.

(c) If any such certificate shall be proved to the satisfaction of the
Board to have been worn out, lost, mislaid or destroyed the Board may cause a
new certificate to be issued and request an indemnity for the lost certificate
if it sees fit.

REGISTER OF MEMBERS
-------------------

58. Contents of Register of Members
-------------------------------

The Board shall cause to be kept in one or more books a Register of Members
and shall enter therein the particulars required by the Act. Unless the Board
so determines, no Member or intending Member shall be entitled to have entered
in the Register of Members any indication of any trust or any equitable,
contingent, future or partial interest in any share or any interest in any
fractional part of a share and if any such entry exists or is permitted by the
Board it shall not be deemed to abrogate any of the provisions of paragraph (a)
of Bye-law 55.

59. Inspection of Register of Members
---------------------------------

(a) The Register of Members shall be open to inspection by Members or
other entitled Persons at the registered office of the Company during business
hours, subject to such reasonable restrictions as the Board may impose, so that
not less than two hours in each normal day of business in Bermuda be allowed for
inspection. The Register of Members may, after notice has been given by
advertisement in an appointed newspaper to that effect, be closed for any time
or times not exceeding in the whole 30 days in each year.

(b) Subject to the provisions of the Act, the Company may keep one or more
overseas or branch registers in any place, and the Board may make, amend and
revoke any such regulations as it may think fit respecting the keeping of such
registers and the contents thereof.

60. Setting of record date
----------------------

Notwithstanding any other provision of these Bye-laws, the Board shall fix
any date as the record date for:

(a) determining the Members entitled to receive any dividend;

(b) determining the Members entitled to receive notice of and to vote at
any general meeting of the Company; and

(c) determining the Members entitled to execute a resolution in writing.

28
<PAGE>

TRANSFER OF SHARES
------------------

61. Instrument of transfer
----------------------

(a) An instrument of transfer shall be in such common form or other form
as the Board or any transfer agent appointed from time to time may accept. Such
instrument of transfer shall be signed by or on behalf of the transferor. The
transferor shall be deemed to remain the holder of such share until the same has
been transferred to the transferee in the Register of Members.

(b) The Board may refuse to recognize any instrument of transfer unless it
is accompanied by the certificate in respect of the shares to which it relates
and by such other evidence as the Board may reasonably require to show the right
of the transferor to make the transfer.

62. Restrictions on transfer
------------------------

(a) Subject to the Act, this Bye-law 62 and such other restrictions
contained in these Bye-laws and elsewhere as may be applicable, any Member may
sell, assign, transfer or otherwise dispose of shares of the Company for which
the Member is the registered holder at the time and, upon receipt of a duly
executed form of transfer in writing, the Board shall procure the timely
registration of the same. If the Board refuses to register a transfer for any
reason it shall notify the proposed transferor and transferee within 30 days of
such refusal.

(b) Without the prior written approval of the Board, no transfer of any
share shall be registered if the Board has reason to believe that the effect of
such transfer would be to (I) increase the number of shares beneficially owned,
directly or indirectly (within the meaning of Section 13(d)(3) of the Exchange
Act and the rules and regulations thereunder), by any Person that is not an
Investment Company to more than five percent (5%) of any class of issued and
outstanding share capital of the Company, (ii) to increase the aggregate number
of Controlled Shares of any Person to more than the Maximum Percentage of any
class of issued and outstanding share capital of the Company or (iii) to result
in adverse tax, regulatory or legal consequences to the Company, any of its
subsidiaries or any of the Members.

(c) Without limiting the foregoing, no transfer of any share shall be
registered unless all applicable consents, authorisations, permissions or
approvals of any governmental body or agency in Bermuda, the United States or
any other applicable jurisdiction required to be obtained prior to such transfer
shall have been obtained.

(d) The registration of transfers may be suspended at such time and for
such periods as the Board may from time to time determine; provided, that such
--------
registration shall not be suspended for more than 45 days in any period of 365
consecutive days.

(e) The Board may, by notice in writing, require any Member, or any Person
proposing to acquire shares of the Company, to certify or otherwise provide to
the Board, within 10 Business Days of request, complete and accurate information
in writing as to such matters as the Board may

29
<PAGE>

request for the purpose of giving effect to Bye-laws 51(a), 51(b), 52(a), 54(b),
54(c) and paragraph (b) of this Bye-law 62, including information in respect of
the following matters:

(i) the number of shares of the Company in which such Person is
legally or beneficially interested;

(ii) the Persons who are beneficially interested in shares in
respect of which any Member is the registered holder;

(iii) the relationship, association or affiliation of such Person
with any other Member or Person whether by means of common
control or ownership or otherwise; and

(iv) any other facts or matters which the Board in its absolute
discretion may consider relevant to the determination of the
number of shares beneficially owned by any Person or the number
of Controlled Shares attributable to any Person.

If any Member or proposed acquiror does not respond to any such
request within the time specified therein, or if the Board has reason to believe
that any certification or other information provided pursuant to any such
request is inaccurate or incomplete, the Board may decline to approve any
transfer or issuance to which such request relates or may determine to disregard
for all purposes the votes attached to any shares held by such Member.

(f) The restrictions on transfer authorised or imposed by these
Bye-laws shall not be imposed in any circumstances in a way that would interfere
with the settlement of trades or transactions entered into through the
facilities of a stock exchange on which the shares are listed or traded from
time to time; provided, that the Company may decline to register transfers in
--------
accordance with these Bye-laws and resolutions of the Board after a settlement
has taken place.

63. Transfers by joint holders
--------------------------

The joint holders of any share or shares may transfer such share or shares
to one or more of such joint holders, and the surviving holder or holders of any
share or shares previously held by them jointly with a deceased Member may
transfer any such share to the executors or administrators of such deceased
Member.

TRANSMISSION OF SHARES
----------------------

64. Representative of deceased Member
---------------------------------

In the case of the death of a Member, the survivor or survivors where the
deceased Member was a joint holder, and the legal personal representatives of
the deceased Member where the deceased Member was a sole holder, shall be the
only persons recognized by the Company as having any title to the deceased
Member's interest in the shares. Nothing herein contained shall release the

30
<PAGE>

estate of a deceased joint holder from any liability in respect of any share
which had been jointly held by such deceased Member with other persons. Subject
to the provisions of Section 52 of the Act, for the purpose of this Bye-law,
"legal personal representative" means the executor or administrator of a
deceased Member or such other person as the Board may in its absolute discretion
decide as being properly authorised to deal with the shares of a deceased
Member.

65. Registration on death or bankruptcy
-----------------------------------

Any Person becoming entitled to a share in consequence of the death or
bankruptcy of any Member may be registered as a Member upon such evidence as the
Board may deem sufficient or may elect to nominate some Person to be registered
as a transferee of such share, and in such case the Person becoming entitled
shall execute in favor of such nominee an instrument of transfer in a form
satisfactory to the Board. On the presentation thereof to the Board, accompanied
by such evidence as the Board may require to prove the title of the transferor
and such other information as the Board shall deem necessary or appropriate, and
the transferee shall be registered as a Member but the Board shall, in either
case, have the same right to decline or suspend registration as it would have
had in the case of a transfer of the share by that Member before such Member's
death or bankruptcy, as the case may be.

66. Registration Fees
-----------------

A fee may be charged by the Company for registering any transfer, probate,
letters of administration, certificate of death or marriage, power of attorney,
distringas or stop notice, order of court or other instrument relating to or
affecting the title to any share, or otherwise making an entry in the Register
of Members relating to any share.

DIVIDENDS AND OTHER DISTRIBUTIONS
---------------------------------

67. Declaration of dividends by the Board
-------------------------------------

Subject to any rights or restrictions at the time lawfully attached to any
class of shares and subject to the provisions of these Bye-laws, the Board may,
in accordance with Section 54 of the Act, declare a dividend to be paid to the
Members, in proportion to the number of shares held by them, and such dividend
may be paid in cash or wholly or partly in specie in which case the Board may
fix the value for distribution in specie of any assets.

68. Other distributions
-------------------

The Board may declare and make such other distributions (in cash or in
specie) to the Members as may be lawfully made out of the assets of the Company.

69. Reserve fund
------------

31
<PAGE>

The Board may from time to time before declaring a dividend set aside, out
of the surplus or profits of the Company, such sum as it thinks proper as a
reserve fund to be used to meet contingencies or for equalizing dividends or for
any other special purpose.

70. Deduction of Amounts due to the Company
---------------------------------------

The Board may deduct from the dividends or distributions payable to any
Member all monies due from such Member to the Company.

71. Unclaimed dividends
-------------------

Any dividend or distribution unclaimed for a period of six years from the
date of declaration of such dividend or distribution shall be forfeited and
shall revert to the Company and the payment by the Board of any unclaimed
dividend or distribution, interest or other sum payable on or in respect of the
share into a separate account shall not constitute the Company a trustee in
respect thereof.

72. Interest on dividend
--------------------

No dividend or distribution shall bear interest against the Company.

CAPITALIZATION
--------------

73. Capitalization
--------------

(a) The Board may resolve to capitalize any part of the amount for the time
being standing to the credit of any of the Company's share premium or other
reserve accounts or to the credit of the profit and loss account or otherwise
available for distribution by applying such sum in paying up unissued shares to
be allotted as fully paid shares pro rata to the Members.

(b) The Board may resolve to capitalize any sum standing to the credit of a
reserve account or sums otherwise available for dividend or distribution by
applying such amounts in paying up in full partly paid shares of those Members
who would have been entitled to such sums if they were distributed by way of
dividend or distribution.

ACCOUNTS AND FINANCIAL STATEMENTS
---------------------------------

74. Records of account
------------------

The Board shall cause to be kept proper records of account with respect to
all transactions of the Company and in particular with respect to:

(a) all sums of money received and expended by the Company and the matters
in respect of which the receipt and expenditure relates;

32
<PAGE>

(b) all sales and purchases of goods by the Company; and

(c) the assets and liabilities of the Company.

Such records of account shall be kept at the registered office of the
Company or, subject to Section 83(2) of the Act, at such other place as the
Board thinks fit and shall be available for inspection by the Directors during
normal business hours. No Member in its capacity as a Member shall have any
right to inspect any accounting record or book or document of the Company except
as conferred by law or as authorised by the Board.

75. Financial year end
------------------

The financial year end of the Company may be determined by resolution of
the Board and failing such resolution shall be December 31 in each year.

76. Financial statements
--------------------

Subject to any rights to waive laying of accounts pursuant to Section 88 of
the Act, financial statements as required by the Act shall be laid before the
Members in general meeting.

AUDIT
-----

77. Appointment of Auditor
----------------------

Subject to Section 88 of the Act, at the annual general meeting or at a
subsequent special general meeting in each year, an independent representative
of the Members shall be appointed by them as Auditor of the accounts of the
Company. Such Auditor may be a Member but no Director, Officer or employee of
the Company shall, during his or her continuance in office, be eligible to act
as an Auditor of the Company.

78. Remuneration of Auditor
-----------------------

The remuneration of the Auditor shall be fixed by the Company in general
meeting or in such manner as the Members may determine.

79. Vacation of office of Auditor
-----------------------------

If the office of Auditor becomes vacant by the resignation or death of the
Auditor, or by the Auditor becoming incapable of acting by reason of illness or
other disability at a time when the Auditor's services are required, the Board
may fill the vacancy thereby created.

80. Access to books of the Company
------------------------------

The Auditor shall at all reasonable times have access to all books kept by
the Company and to all accounts and vouchers relating thereto, and the Auditor
may call on the Directors or Officers

33
<PAGE>

of the Company for any information in their possession relating to the books or
affairs of the Company.

81. Report of the Auditor
---------------------

(a) Subject to any rights to waive laying of accounts or appointment of an
Auditor pursuant to Section 88 of the Act, the accounts of the Company shall be
audited at least once in every year.

(b) The financial statements provided for by these Bye-laws shall be
audited by the Auditor in accordance with generally accepted auditing standards.
The Auditor shall make a written report thereon in accordance with generally
accepted auditing standards and the report of the Auditor shall be submitted to
the Members in general meeting.

(c) The generally accepted auditing standards referred to in paragraph (b)
of this Bye-law 81 shall be those of the United States and the financial
statements and the report of the Auditor shall disclose this fact.

GRATUITIES, PENSIONS AND INSURANCE
----------------------------------

82. Benefits
--------

The Board may (by establishment of or maintenance of schemes or otherwise)
provide benefits, whether by the payment of gratuities or pensions or by
insurance or otherwise, for any past or present Director, Officer or employee of
the Company or any of its subsidiaries or anybody corporate associated with, or
any business acquired by, any of them, and for any member of his or her family
(including a spouse and a former spouse) or any individual who is or was
dependent on him or her, and may (as well before as after he ceases to hold such
office or employment) contribute to any fund and pay premiums for the purchase
or provision of any such benefit.

83. Insurance
---------

Without prejudice to the provisions of Bye-laws 30 and 31, the Board shall
have the power to purchase and maintain insurance for or for the benefit of any
individuals who are or were at any time Directors, Officers, or employees of the
Company, or of any other company which is its holding company or in which the
Company or such holding company has any interest whether direct or indirect or
which is in any way allied to or associated with the Company, or of any
subsidiary of the Company or any such other company, or who are or were at any
time trustees of any pension fund in which employees of the Company or any such
other company or subsidiary are interested, including (without prejudice to the
generality of the foregoing) insurance against any liability incurred by such
individuals in respect of any act or omission in the actual or purported
execution or discharge of their duties or in the exercise or purported exercise
of their powers or otherwise in

34
<PAGE>

relation to their duties, powers or offices in relation to the Company or any
such other company, subsidiary or pension fund.

84. Limitation on Accountability
----------------------------

No Director or former Director shall be accountable to the Company or the
Members for any benefit provided pursuant to Bye-law 82 or 83 and the receipt
of any such benefit shall not disqualify any individual from being or becoming a
Director of the Company.

NOTICES
-------

85. Notices to Members of the Company
---------------------------------

A notice may be given by the Company to any Member either by delivering it
to such Member in person or by sending it to such Member's address in the
Register of Members or to such other address given for the purpose. For the
purposes of this Bye-law, a notice may be sent by mail, courier service, cable,
telex, telecopier, facsimile, electronic-mail or other mode of representing
words in a legible and non-transitory form. If such notice is sent by next-day
courier, cable, telex, telecopier, facsimile or electronic-mail, it shall be
deemed to have been given the Business Day following the sending thereof and, if
by registered mail, three Business Days following the sending thereof.

86. Notices to joint Members
------------------------

Any notice required to be given to a Member shall, with respect to any
shares held jointly by two or more Persons, be given to whichever of such
Persons is named first in the Register of Members and notice so given shall be
sufficient notice to all the holders of such shares.

87. Service and delivery of notice
------------------------------

Subject to Bye-law 85, any notice shall be deemed to have been served at
the time when the same would be delivered in the ordinary course of transmission
and, in proving such service, it shall be sufficient to prove that the notice
was properly addressed and prepaid, if posted, and the time when it was posted,
delivered to the courier or to the cable company or transmitted by telex,
facsimile or other method as the case may be.

REGISTERED OFFICE
-----------------

88. Registered Office
-----------------

The registered office of the Company shall be at such address as the Board
may fix from time to time by resolution.

SEAL OF THE COMPANY
-------------------

89. The seal
--------

35
<PAGE>

The seal of the Company shall be in such form as the Board may from time to
time determine. The Board may adopt one or more duplicate seals.

90. Manner in which seal is to be affixed
-------------------------------------

The seal of the Company shall not be affixed to any instrument except
attested by the signature of a Director and the Secretary or any two Directors,
or any person appointed by the Board for the purpose; provided, that any
--------
Director or Officer may affix the seal of the Company attested by such
Director's or Officer's signature only to any authenticated copies of these Bye-
laws, the incorporating documents of the Company, the minutes of any meetings or
any other documents required to be authenticated by such Director or Officer.
Any such signature may be printed or affixed by mechanical means on any share
certificate, debenture, stock certificate or other security certificate.

91. Destruction of Documents
------------------------

The Company shall be entitled to destroy all instruments of transfer of
shares which have been registered, and all other documents on the basis of which
any entry is made in the Register, at any time after the expiration of six years
from the date of registration thereof and all dividends mandates or variations
or cancellations thereof and notifications of change of address at any time
after the expiration of two years from the date of recording thereof and all
share certificates which have been canceled at any time after the expiration of
one year from the date of cancellation thereof and all paid dividends, warrants
and checks (cheques) at any time after the expiration of one year from the date
of actual payment thereof and all instruments of proxy which have been used for
the purpose of a poll at any time after the expiration of one year from the date
of such use and all instruments of proxy which have not been used for the
purpose of a poll at any time after one month from the end of the meeting to
which the instrument of proxy relates and at which no poll was demanded. It
shall conclusively be presumed in favor of the Company that every entry in the
Register purporting to have been made on the basis of an instrument of transfer
or other document so destroyed was duly and properly made, that every instrument
of transfer so destroyed was a valid and effective instrument duly and properly
registered, that every share certificate so destroyed was a valid and effective
certificate duly and properly canceled and that every other document
hereinbefore mentioned so destroyed was a valid and effective document in
accordance with the recorded particulars thereof in the books or records of the
Company; provided, that:
--------

(a) the provisions aforesaid shall apply only to the destruction of a
document in good faith and without notice of any claim (regardless of
the parties thereto) to which the document might be relevant;

(b) nothing herein contained shall be construed as imposing upon the
Company any liability in respect of the destruction of any such
document earlier than as aforesaid or in any other circumstances which
would not attach to the Company in the absence of this Bye-law; and

36
<PAGE>

(c) references herein to the destruction of any document include
references to the disposal thereof in any manner.

UNTRACED MEMBERS
----------------

92. Sale of Shares
--------------

The Company shall be entitled to sell at the best price reasonably
obtainable, or if the shares are listed on a stock exchange to purchase at the
trading price on the date of purchase, the shares of a Member or the shares to
which a Person is entitled by virtue of transmission on death, bankruptcy or
otherwise by operation of law; provided, that:
---------

(a) during the period of 12 years prior to the date of the publication of
the advertisements referred to in paragraph (b) of this Bye-law 92
(or, if published on different dates, the first thereof) at least
three dividends in respect of the shares in question have been
declared and all dividends, warrants and checks (cheques) that have
been sent in the manner authorised by these Bye-laws in respect of the
shares in question have remained uncashed; and

(b) the Company shall as soon as practicable after expiry of the said
period of 12 years have inserted advertisements both in a national
daily newspaper and in a newspaper circulating in the area of the last
known address of such Member or other Person giving notice of its
intention to sell or purchase the shares; and

(c) during the said period of 12 years and the period of three months
following the publication of the said advertisements the Company shall
have received no indication either of the whereabouts or of the
existence of such Member or person; and

(d) if the shares are listed on a stock exchange, notice shall have been
given to the relevant department of such stock exchange of the
Company's intention to make such sale or purchase prior to the
publication of advertisements.

If during any 12-year period referred to above, further shares have been issued
in right of those held at the beginning of such period or of any previously
issued during such period and all the other requirements of this Bye-law 92
(other than the requirement that they be in issue for 12 years) have been
satisfied in regard to the further shares, the Company may also sell or purchase
the further shares.

93. Instrument of Transfer
----------------------

To give effect to any such sale or purchase, the Board may authorise some
person to execute an instrument of transfer of the shares sold or purchased to,
or in accordance with the directions of, the purchaser and an instrument of
transfer executed by that person shall be as effective as if it had been
executed by the holder of, or person entitled by transmission to, the shares.
The transferee of

37
<PAGE>

any shares sold shall not be bound to see to the application of the purchase
money, nor shall his title to the shares be affected by any irregularity in, or
invalidity of, the proceedings relating to the sale.

94. Proceeds of Sale
----------------

The net proceeds of sale or purchase of shares shall belong to the Company
which, for the period of six years after the transfer or purchase, shall be
obliged to account to the former Member or other Person previously entitled as
aforesaid for an amount equal to such proceeds and shall enter the name of such
former Member or other Person in the books of the Company as a creditor for such
amount. No trust shall be created in respect of the debt, no interest shall be
payable in respect of the same and the Company shall not be required to account
for any money earned on the net proceeds, which may be employed in the business
of the Company or invested in such investments as the Board from time to time
thinks fit. After the said six-year period has passed, the net proceeds of
share shall become the property of the Company, absolutely, and any rights of
the former Member or other Person previously entitled as aforesaid shall
terminate completely.


WINDING-UP
----------

95. Determination to liquidate
--------------------------

Subject to the Act, the Company shall be wound up voluntarily by resolution
of the Members.

96. Winding-up/distribution by liquidator
-------------------------------------

If the Company shall be wound up the liquidator may, with the sanction of a
resolution of the Members, divide among the Members in specie or in kind the
whole or any part of the assets of the Company (whether they shall consist of
property of the same kind or not) and may, for such purpose, set such value as
he or she deems fair upon any property to be divided as aforesaid and may
determine how such division shall be carried out as between the Members or
different classes of Members. The liquidator may, with the like sanction, vest
the whole or any part of such assets in trustees upon such trusts for the
benefit of the Members as the liquidator shall think fit, but so that no Member
shall be compelled to accept any shares or other securities or assets whereon
there is any liability.

ALTERATION OF BYE-LAWS
----------------------

97. Alteration of Bye-laws
----------------------

No Bye-law shall be rescinded, altered or amended and no new Bye-law shall
be made until the same has been approved by a resolution of the Board and
confirmed by a resolution of the Members. Paragraph (b) of Bye-law 11 and all of
Bye-law 12 shall not be rescinded, altered or amended and no new Bye-law
inconsistent with such existing Bye-laws shall be made until the same has been
approved by a resolution of the Board and confirmed by a resolution of Members
holding

38
<PAGE>

at least sixty-six and two-thirds percent (66 2/3%) of the issued and
outstanding share capital of the Company.