MONTPELIER RE HOLDINGS LTD. LONG-TERM INCENTIVE PLAN PERFORMANCE SHARE AND RESTRICTED SHARE UNIT AWARD AGREEMENT
Exhibit 10.1
LONG-TERM INCENTIVE PLAN
PERFORMANCE SHARE AND RESTRICTED SHARE UNIT
AWARD AGREEMENT
AWARD AGREEMENT
This Award Agreement (the “Award Agreement”) is made and entered into as of January 1st, 2006
between Montpelier Re Holdings Ltd. (the “Company”) and (the “Participant”).
The Company hereby grants to the Participant Performance Shares and Restricted Share Units
(the “Award”) on the terms and conditions as set forth in this Award Agreement and in the
Montpelier Long-Term Incentive Plan (the “Plan”).
In accordance with this grant, and as a condition thereto, the Company and the Participant
agree as follows:
SECTION
1. Performance Share Target Award; Performance Period; Date of Grant:
Target Award:
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Performance Shares (the “Target Award”) | |
Performance Period:
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January 1, 2006 through and ending on December 31, 2008 (the “Performance Period”) | |
Date of Grant:
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January 1, 2006 |
SECTION
2. Nature of Award. The Target Award represents the opportunity to receive a future
payment equal to the fair market value of such number of shares of Company common shares, $0.001666
par value per share (“Shares”), as are earned in accordance with Section 3 of this Award Agreement
as more fully set forth in Section 4 of this Award Agreement.
SECTION
3. Determination of Number of Shares Earned. The number of Performance Shares
earned as of the end of a Performance Period, if any, shall be determined as follows:
# of Shares = Payout Percentage x Target Award
The “Payout Percentage” shall be determined by the Committee in its sole discretion based on the
Performance Criteria and Harvest Scale set out in Appendix 1 hereto
SECTION
4. Payment of Performance Shares. The amount payable to a Participant in settlement
of the Performance Shares shall be equal to the fair market value (to be issued fully paid in
consideration of the Participant’s services to the Company) of a Share, as determined by the
Committee by reference to the average of the daily closing price of the Company’s common shares on
the New York Stock Exchange, as reported in the Wall Street Journal, for each of the five
consecutive trading days preceding and including, as the last day, December 31, 2007 multiplied by
the number of Performance Shares earned with respect to the Performance Period, as determined
pursuant to Section 3 of this Award Agreement. Payment in respect of an Award shall be made in
cash, in Shares of equivalent value or in some combination thereof, as determined by the Committee
in its sole discretion. Subject to Section 6 of this Award Agreement, payment shall be made as
soon as reasonably practicable following the close of the Performance Period and the Committee’s
determination of the Payout Percentage.
SECTION 5. Restricted Share Unit Award; Vesting; Date of Grant
Award:
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Restricted Share Units (the “RSU Award”) | |
Vesting Period:
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December 31, 2006 through and ending on December 31, 2008 | |
Date of Grant:
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January 1, 2006 |
SECTION
6. Nature of Award. The RSU Award represents the opportunity to receive shares of
Company common shares, $[0.001666] par value per share (“RSU Shares”), as are earned in accordance
with Section 7 of this Award Agreement.
SECTION 7. Vesting. Subject to the Participant remaining employed at the applicable Vesting
Date, as hereinafter defined, the RSU Award shall vest over the vesting period described in Section
5 above in three equal tranches of Restricted Share Units (each a “Tranche”) at midnight on
December 31st 2006, December 31st 2007 and December 31st 2008,
respectively (each a “Vesting Date”). Shares shall be issued by the Company to the Participant in
satisfaction of
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the RSU Award as soon as reasonably practicable following the end of the vesting
period described in Section 5 above.
SECTION 8. [Reserved]
SECTION
9. Termination of Employment
(a) Unless otherwise determined by the Committee at the time of termination, if the
Participant’s employment with the Company or one of its
subsidiaries is terminated by the Company or the subsidiary for any reason other than Cause
(as defined in Section 8 of the Plan), death or disability(as determined in accordance with Section
8 of the Plan), or is terminated by the Participant on account of a Constructive Termination (as
defined in Section 8 of the Plan) or Retirement (as defined below): (i) during the first year of
the Performance Period, all Performance Shares shall be forfeited; (ii) during the second year of
the Performance Period, the determination of the Payout Percentage for the Performance Period will
be made by the Committee at the end of the Performance Period, and Performance Shares earned, if
any, will be paid based on the Payout Percentage, prorated for the number of full months elapsed
from and including the month in which the Performance Period began to and including the month in
which the termination of employment occurs; (iii) during the third year of the Performance Period,
the determination of the Payout Percentage for the Performance Period will be made by the Committee
at the end of the Performance Period, and Performance Shares earned, if any, will be paid based on
the Payout Percentage without prorating, and (iv) without regard to the year of the Performance
Period, all Restricted Share Units unvested at the date of termination shall be forfeited, and any
vested Restricted Share Units shall be settled in accordance with the provisions of Section 7 as
soon as reasonably practicable following the end of the vesting period described in Section 5.
For purposes of this Award Agreement, “Retirement” means a termination of the Participant’s
employment or service constituting retirement under an approved retirement program of the Company
(or such other plan as may be approved by the Committee).
(b) Unless otherwise determined by the Committee at the time of termination, if the
Participant’s employment is terminated by the Company or one of its subsidiaries for Cause or by
the Participant not on account of a Constructive Termination, Retirement, death or disability (as
determined in accordance with Section 8 of the Plan) during the Performance Period, then:
(i) all Performance Shares shall be forfeited; and,
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(ii) all unvested Restricted Share Units shall be forfeited and, unless terminated
for Cause, any vested Restricted Share Units shall be settled in accordance with the
provisions of Section 7 as soon as reasonably practicable following the end of the vesting
period described in Section 5.
(c) For purposes of the Plan and the Award Agreement, a transfer of employment from the
Company to any subsidiary of the Company or vice versa, or from one subsidiary to another, shall
not be considered a termination of employment.
SECTION 10. Change in Control. Notwithstanding the provisions of Section [ ] above, if
within twenty four months following the occurrence of a Change in Control (as defined in the Plan),
the employment of the Participant with the Company or one of its subsidiaries is terminated by the
Company or the subsidiary for any reason other than for Cause, death or disability (as determined
in accordance with Section [ ] of the Plan) or is terminated by the Participant on account of a
Constructive Termination, upon such termination:
(a) the Target Award shall be deemed to have been earned with respect to the full Performance
Period and payment with respect to the Performance Shares shall be made to the Participant in cash
as soon as reasonably practicable after such termination; and,
(b) the Restricted Share Units shall be deemed to have vested in full and Shares with
respect to the RSU Award shall be issued to the Participant by the Company as soon as
reasonably practicable after such termination.
SECTION
11. Tax Withholding. Pursuant to paragraph 17(c) of the Plan, the Committee shall
have the power and the right to deduct or withhold, or require the Participant to remit to the
Company, an amount sufficient to satisfy any federal, state, local or other taxes required by
applicable law to be withheld with respect to payment of the Award. The Committee may condition
the payment hereunder upon the Participant’s satisfaction of such withholding obligations.
SECTION
12. Rights As A Shareholder. The Participant shall have no rights as shareholder
with respect to any Shares underlying the Award until and unless the Participant’s name is entered
in the Company’s Register of Members as the holder of such shares and a Share certificate is issued
to the Participant upon payment with respect to the Award.
SECTION 13. Dividend Equivalents. The Participant shall be entitled to receive dividend
equivalents with respect to Shares underlying the Award.
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SECTION
14. Transferability. Pursuant to paragraph 14 of the Plan the Participant may
designate a beneficiary or beneficiaries to receive any payment to which he or she may be entitled
in respect of Awards under the Plan in the event of his or her death on a form to be provided by
the Committee; Except as provided herein, the Participant may not sell, transfer, pledge, assign or
otherwise alienate or hypothecate the Performance Shares, other than by his or her last Will and
Testament or by the laws of descent and distribution.
SECTION 15. Ratification of Actions. By accepting the Award or other benefit under the
Plan, the Participant and each person claiming under or through him or her shall be conclusively
deemed to have indicated the Participant’s acceptance and ratification of, and consent to, any
action taken under the Plan or
the Award by the Company, the Board or the Committee. All decisions or interpretations of the
Company, the Board and the Committee upon any questions arising under the Plan and/or this Award
Agreement shall be binding, conclusive and final on all parties. In the event of any conflict
between any provision of the Plan and this Award Agreement, the terms and provisions of the Plan
shall control.
SECTION 16. Notices. Any notice hereunder to the Company shall be addressed to its office,
Xxxxxxxxxx Xxxxx, 0 Xxx-Xx-Xxxxx Xxxx, Xxxxxxxx XX00, Xxxxxxx; Attention: Corporate Secretary, and
any notice hereunder to the Participant shall be addressed to him or her at the address specified
on the Award Agreement, subject to the right of either party to designate at any time hereafter in
writing some other address.
SECTION 17. Definitions. Capitalized terms not otherwise defined herein shall have the
meanings given them in the Plan.
SECTION 18. Governing Law and Severability. This Award Agreement will be governed by and
construed in accordance with the laws of Bermuda, without regard to conflicts of law provisions. In
the event any provision of the Award Agreement shall be held illegal or invalid for any reason, the
illegality or invalidity shall not affect the remaining parts of the Award Agreement, and the Award
Agreement shall be construed and enforced as if the illegal or invalid provision had not been
included.
SECTION 19. No Rights to Continued Employment. This Award Agreement is not a contract of
employment. Nothing in the Plan or in this Award Agreement shall interfere with or limit in any
way the right of the Company or any subsidiary to terminate the Participant’s employment at any
time, for any reason or no reason, or confer upon the Participant the right to continue in the
employ of the Company or a subsidiary.
SECTION 20. Counterparts. This Award Agreement may be signed in any number of counterparts,
each of which shall be an original, with the same effect as if the signatures thereto and hereto
were upon the same instrument.
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IN WITNESS WHEREOF, the undersigned have caused this Award Agreement to be duly executed as of
the date first written above.
| MONTPELIER RE HOLDINGS LTD. | ||||
| By: | ||||
| Name: | ||||
| Title: | ||||
| PARTICIPANT | ||||
| By: | ||||
| Name: | ||||
| Title: | ||||
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