EXHIBIT 10.4
EMPLOYMENT AGREEMENT
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This Employment Agreement is dated as of May 27, 1997 and is entered
into between Renaissance Reinsurance Ltd., a Bermuda company (the "Company"),
and ____________("Executive").
WHEREAS, Executive is currently employed as a Senior Vice President
and Chief Financial Officer of the Company; and
WHEREAS, Executive and the Company desire to embody in this Agreement
the terms and conditions under which Executive shall continue to be employed by
the Company.
NOW, THEREFORE, the parties hereby agree:
ARTICLE I.
Employment, Duties and Responsibilities
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1.01. Employment. During the Term (as defined below), Executive
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shall serve as a Senior Vice President and Chief Financial Officer of the
Company and its parent, RenaissanceRe Holdings Ltd. ("Holdings"). Executive
agrees to devote his full time and efforts to promote the interests of the
Company.
1.02. Duties and Responsibilities. Executive shall have such duties
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and responsibilities as specified by the Company's Board of Directors (the
"Company's Board") from time to time and as are consistent with his position.
1.03. Base of Operation. Executive's principal base of operation for
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the performance of his duties and responsibilities under this Agreement shall be
the offices of the Company in Hamilton, Bermuda; provided, however, that
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Executive shall perform such duties and responsibilities outside of Bermuda as
shall from time to time be reasonably necessary to fulfill his obligations
hereunder. Executive's performance of any duties and responsibilities outside
of Bermuda shall be conducted in a manner consistent with any guidelines
provided to Executive by Holdings' Board of Directors (the "Holdings Board").
ARTICLE II.
Term
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2.01. Term. Subject to Article V, the employment of the Executive
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under this Agreement shall be for a term (the "Term") commencing as of the date
first written above and continuing until July 1, 1998; provided, however, that
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the Term shall be extended for successive one-year periods as of July 1st of
each year commencing with July 1, 1998 (each, a "Renewal Date") unless, with
respect to any such Renewal Date, either party hereto gives the other party at
least 30 days prior written notice of its election not to so extend the Term.
ARTICLE III.
Compensation and Expenses
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3.01. Salary, Incentive Awards and Benefits. As compensation and
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consideration for the performance by Executive of his obligations under this
Agreement, Executive shall be entitled, during the Term, to the following
(subject, in each case, to the provisions of ARTICLE V hereof):
(a) Salary; Bonus. The Company shall pay Executive a base
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salary at a rate to be determined by the Board, upon recommendation of the Chief
Executive Officer, payable in accordance with the normal payment procedures of
the Company and subject to such withholding and other normal employee deductions
as may be required by law. Bonuses shall be payable at the discretion of the
Company.
(b) Awards. Executive may participate in the Second Amended and
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Restated 1993 Stock Incentive Plan of RenaissanceRe Holdings Ltd. (the "Plan").
Executive may receive grants from time to time as determined by the Compensation
Committee of the Holdings Board. Executive shall enter into separate award
agreements with respect to such awards granted to him ("Awards") under the Plan,
and his rights with respect to such Awards shall be governed by the Plan and
such award agreements.
(c) Benefits. Executive shall be eligible to participate in
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such life insurance, health, disability and major medical insurance benefits,
and in such other employee benefit plans and programs for the benefit of the
employees and officers of the Company, as may be maintained from time to time
during the Term, in each case to the extent and in the manner available to
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other officers of the Company and subject to the terms and provisions of such
plan or program.
(d) Vacation. Executive shall be entitled to reasonable paid
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vacation periods, not to exceed five weeks for each full year during the Term,
to be taken at his discretion, in a manner consistent with his obligations to
the Company under this Agreement, and subject, with respect to timing, to the
reasonable approval of the Chief Executive Officer of the Company.
(e) Indemnification/Liability Insurance. The Company shall
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indemnify Executive as required by the Bye-laws, and may maintain customary
insurance policies providing for indemnification of Executive.
3.02. Expenses; Perquisites. During the Term, the Company shall
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provide Executive with the following expense reimbursements and perquisites:
(a) Business Expenses. The Company will reimburse Executive for
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reasonable business-related expenses incurred by him in connection with the
performance of his duties hereunder, subject, however, to the Company's policies
relating to business-related expenses as in effect from time to time.
(b) Automobile. The Company shall provide Executive with an
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automobile with a value comparable to automobiles customarily provided to
executive officers of comparable Bermuda-based companies.
(c) Tax Gross-Up. To the extent that benefits provided to
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Executive under subsections 3.02(b) of this Agreement result in imputed income
and a resulting increased income tax liability to Executive, the Company shall
pay Executive a tax reimbursement benefit in an amount such that, after
deduction of all income taxes payable with respect to such tax reimbursement
benefit, the amount retained by Executive will be equal to the amount of such
increased income tax liability.
ARTICLE IV.
Exclusivity, Etc.
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4.01. Exclusivity; Non-Competition. Executive agrees to perform his
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duties, responsibilities and obligations hereunder efficiently and to the best
of his ability. Executive agrees that he will devote his entire working time,
care and attention and best efforts to such duties, responsibilities and
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obligations throughout the Term. Executive also agrees that during the Term he
will not engage in any business activities that are competitive with the
business activities of the Company or any of its divisions, subsidiaries or
affiliates.
4.02. Other Business Ventures. Executive agrees that during the Term
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he will not own, directly or indirectly, any controlling or substantial stock or
other beneficial interest in any business enterprise which is engaged in
business activities that are competitive with the business activities of the
Company or any of its divisions, subsidiaries or affiliates. The preceding
sentence notwithstanding, Executive may own, directly or indirectly, up to 1% of
the outstanding capital stock of any business having a class of capital stock
which is traded on any major stock exchange or in a national over-the-counter
market.
4.03. Confidential Information. Executive agrees that he will not,
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at any time during or after the Term, make use of or divulge to any other
person, firm or corporation any trade or business secret, process, method or
means, or any other confidential information concerning the business or policies
of the Company or any of its divisions, subsidiaries or affiliates, which he may
have learned in connection with his employment hereunder. For purposes of this
Agreement, a "trade or business secret, process, method or means, or any other
confidential information" shall mean any information designated as confidential
by the Board and as to which Executive receives notice, provided that Executive
shall be obligated to confer periodically with and assist the Board in
determining which information should, in the best interests of the Company, be
so designated. Executive's obligation under this Section 4.03 shall not apply
to any information which (i) is known publicly; (ii) is in the public domain or
hereafter enters the public domain without the fault of Executive; (iii) is
known to Executive prior to his receipt of such information from the Company, as
evidenced by written records of Executive or (iv) is hereafter disclosed to
Executive by a third party not under an obligation of confidence to the Company.
Executive agrees not to remove from the premises of the Company, except as an
employee of the Company in pursuit of the business of the Company or except as
specifically permitted in writing by the Board, any document or other object
containing or reflecting any such confidential information. Executive
recognizes that all such documents and objects, whether developed by him or by
someone else, will be the sole exclusive property of the Company. Upon
termination of his employment hereunder, Executive shall forthwith deliver to
the Company all such confidential information, including without limitation all
lists of customers, correspondence, accounts, records and any other documents or
property made or held by him or under his control in relation to the business or
affairs of
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the Company or its subsidiaries or affiliates, and no copy of any such
confidential information shall be retained by him.
4.04. Non-Competition Obligations. During the Term and, other than
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in the case of the death or disability of the Executive, upon any termination of
the employment of the Executive (including a termination by reason of either
party's election not to extend the Term as provided in Section 2.01), the
Executive shall not, for a period of one year from the date of such termination
(the "Non-Competition Period"), directly or indirectly, whether as an employee
consultant, independent contractor, partner, joint venturer or otherwise, (A)
engage in any business activities reasonably determined by the Company's Board
to be competitive, to a material extent, with any substantial type or kind of
business activities conducted by the Company or any of its divisions,
subsidiaries or affiliates at the time of such termination; (B) on behalf of any
person or entity engaged in business activities competitive with the business
activities of the Company or any of its divisions, subsidiaries or affiliates,
solicit or induce, or in any manner attempt to solicit or induce, any person
employed by, or as agent of, the Company or any of its divisions, subsidiaries
or affiliates to terminate such person's contract of employment or agency, as
the case may be, with the Company or with any such division, subsidiary or
affiliate or (C) divert, or attempt to divert, any person, concern, or entity
from doing business with the Company or any of its divisions, subsidiaries or
affiliates, nor will he attempt to induce any such person, concern or entity to
cease being a customer or supplier of the Company or any of its divisions,
subsidiaries or affiliates. The preceding sentence notwithstanding, in the case
of (i) a voluntary termination of employment by the Executive which is not for
"Good Reason" following a "Change in Control" (each as hereinafter defined),
(ii) a termination by the Company for Cause (as hereinafter defined), or (iii)
an election by the Executive not to extend the term as provided in Section 2.01,
the Company may elect, within 14 days after the date of such termination, to
waive the Executive's non-competition obligations, in which case it shall not be
required to make payments to the Executive during the Non-Competition Period, as
provided in Section 5.05(a).
4.05. Remedies. Executive acknowledges that the Company's remedy at
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law for a breach by him of the provisions of this Article IV will be inadequate.
Accordingly, in the event of a breach or threatened breach by Executive of any
provision of this Article IV, the Company shall be entitled to injunctive relief
in addition to any other remedy it may have. If any of the provisions of, or
covenants contained in, this Article IV are hereafter construed to be invalid or
unenforceable in any jurisdiction, the same shall not affect the remainder of
the
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provisions or the enforceability thereof in any other jurisdiction, which
shall be given full effect, without regard to the invalidity or unenforceability
in such other jurisdiction. If any of the provisions of, or covenants contained
in, this Article IV are held to be unenforceable in any jurisdiction because of
the duration or geographical scope thereof, the parties agree that the court
making such determination shall have the power to reduce the duration or
geographical scope of such provision or covenant and, in its reduced form, such
provision or covenant shall be enforceable; provided, however, that the
determination of such court shall not affect the enforceability of this Article
IV in any other jurisdiction.
ARTICLE V.
Termination
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5.01. Termination for Cause. The Company shall have the right to
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terminate Executive's employment at any time for "Cause". For purposes of this
Agreement, "Cause" shall mean (a) Executive's failure to substantially perform
his duties under this Agreement, (b) the engaging by Executive in misconduct
which is injurious to the Company or any of its divisions, subsidiaries or
affiliates, monetarily or otherwise, (c) the commission by Executive of an act
of fraud or embezzlement against the Company or any of its divisions,
subsidiaries or affiliates, (d) the conviction of Executive of a felony, or (e)
Executive's material breach of the provisions of any of Sections 4.01, 4.02 or
4.03 of this Agreement, provided Executive has received prior written notice of
such breach.
5.02. Death. In the event Executive dies during the Term, the
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Executive's employment shall automatically terminate, such termination to be
effective on the date of Executive's death.
5.03. Disability. In the event that Executive suffers a disability
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which prevents him from substantially performing his duties under this Agreement
for a period of at least 90 consecutive days, or 180 non-consecutive days within
any 365-day period, and Executive becomes eligible for the Company's long-term
disability plan, the Company shall have the right to terminate the Executive's
employment, such termination to be effective upon the giving of notice to
Executive in accordance with Section 6.03 of this Agreement.
5.04. Termination Without Cause. The Company may at any time
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terminate Executive's employment for reasons other than Cause.
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5.05. Effect of Termination.
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(a) Obligations of Company. In the event of any termination
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of the Executive's employment hereunder, the Company shall pay Executive any
earned but unpaid base salary. In addition, except as provided in Section 5.06,
upon a termination of Executive's employment for any reason other than the
Executive's death or disability (including a termination by reason of either
party's election not to extend the Term as provided in Section 2.01), the
Company shall continue to pay Executive during the Non-Competition Period, his
then current base salary, and an amount equal to the highest regular annual
bonus paid or payable to the Executive over the preceding three fiscal years
(excluding any extraordinary or non-recurring bonus), such amounts to be payable
in equal monthly installments commencing on the date which is one month after
the date of such termination. The preceding sentence notwithstanding, in the
event of a termination of employment described in the last sentence of Section
4.04 of this Agreement, if the Company elects to waive the Executive's non-
competition obligations within 14 days after the date of such termination, the
Company shall not be required to make such additional payments.
(b) Awards. Executive's rights with respect to Awards, upon any
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termination of his employment with the Company, shall be governed exclusively by
the terms and conditions of the Plan and any award agreements executed by
Executive in connection with the Plan.
(c) Obligations of Executive. Executive may terminate his
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employment at any time by 10 days' written notice to the Company. Executive
shall have no obligations to the Company under this Agreement after the
termination of his employment, except and to the extent Sections 4.03, 4.04 or
4.05 shall apply.
5.06. Termination Following a Change in Control. In the event that a
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Change in Control occurs (as hereinafter defined) and, on or within one year
following the date of such Change in Control, the Executive's employment is
terminated by the Company without Cause, or the Company elects not to extend the
Term as provided in Section 2.01, or the Executive terminates his employment
voluntarily for "Good Reason" (as hereinafter defined), then in lieu of the
payments described in the second sentence of Section 5.05(a), the Company shall
pay the Executive, within fifteen days following the date of such termination, a
lump sum cash amount equal to two times the sum of:
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(i) Executive's annual base salary at the highest rate in effect
during the Term; and
(ii) the highest regular annual bonus paid or payable to the Executive
over the preceding three fiscal years (excluding any
extraordinary or non-recurring bonus).
For purposes of this Agreement, "Good Reason" means
(i) any action taken or failed to be taken by the Company
or any of its officers which, without Executive's prior written consent,
changes Executive's position (including titles), authority, duties or
responsibilities from those in effect prior to the Change in Control, or
reduces Executive's ability to carry out such duties and responsibilities;
(ii) any failure by the Company to comply with any of the
provisions of Section 3 of this Agreement, other than an insubstantial or
inadvertent failure which is remedied by the Company promptly after receipt
of notice thereof from Executive;
(iii) the Company's requiring Executive to be employed
at any location more than 35 miles further from his current principal
residence than the location at which Executive was employed immediately
preceding the Change in Control; or
(iv) any failure by the Company to obtain the assumption
of and agreement to perform this Agreement by a successor as contemplated
by Section 6.02(b) of this Agreement.
For purposes of this Agreement, "Change of Control" means the
acquisition by any individual, entity or group (within the meaning of Section
13(d)(3) or 14(d)(2) of the Securities and Exchange Act of 1934, as amended (the
"Exchange Act") (a "Person") of beneficial ownership (within the meaning of
Rule 13d-3 promulgated under the Exchange Act) of securities representing more
than 50% of the value and voting power of all of Holdings' outstanding equity
securities (the "Outstanding Equity Securities"); provided, however, that the
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following acquisitions shall not constitute a Change of Control: (i) any
acquisition by the Holdings (ii) any acquisition by one or more of the
"Investors" (as such term is defined in the Plan) or any entity directly or
indirectly controlling, controlled by, or
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under common control with, one or more or the Investors (an "Investor
Affiliate"), or (iii) any acquisition by a corporation pursuant to a merger,
consolidation or other similar transaction (a "Corporate Event") if, as a result
of such Corporate Event, (a) substantially all of the individuals and entities
who were the beneficial owners, respectively, of the Outstanding Equity
Securities immediately prior to such Corporate Event beneficially own, directly
or indirectly, securities representing more than 50% of the value and voting
power of the then outstanding equity securities of the corporation resulting
from such Corporate Event (including a corporation which, as result of such
transaction, owns Holdings or all or substantially all of Holding's assets
either directly or through one or more subsidiaries) in substantially the same
proportions as their ownership immediately prior to such Corporate Even, of the
Outstanding Equity Securities, and (b) no Person other than (1) one of more of
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the Investors or any Investor Affiliate, or (2) any corporation resulting from
such Corporate Event, beneficially owns, directly or indirectly, securities
representing more than 50% of the value and voting power of the then outstanding
equity securities of the corporation resulting from such Corporate Event.
Except as specifically provided in this Section 5.06, the effect of a
termination of Executive's employment following a Change in Control shall be
governed by the provisions of Section of 5.05.
ARTICLE VI.
Miscellaneous
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6.01. Life Insurance. Executive agrees that the Company or any of
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its divisions, subsidiaries or affiliates may apply for and secure and own
insurance on Executive's life (in amounts determined by the Company). Executive
agrees to cooperate fully in the application for and securing of such insurance,
including the submission by Executive to such physical and other examinations,
and the answering of such questions and furnishing of such information by
Executive, as may be required by the carrier(s) of such insurance.
Notwithstanding anything to the contrary contained herein, neither the Company
nor any of its divisions, subsidiaries or affiliates shall be required to obtain
any insurance for or on behalf of Executive.
6.02. Benefit of Agreement; Assignment; Beneficiary. (a) This
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Agreement shall inure to the benefit of and be binding upon the Company and its
successors and assigns, including, without limitation, any corporation or person
which may acquire all or substantially all of the Company's assets or business,
or with or into which the Company may be consolidated or merged.
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This Agreement shall also inure to the benefit of, and be enforceable by,
Executive and his personal or legal representatives, executors, administrators,
successors, heirs, distributees, devisees and legatees.
(b) The Company shall require any successor (whether direct or
indirect, by operation of law, by purchase, merger, consolidation or otherwise)
to all or substantially all of the business and/or assets of the Company to
expressly assume and agree to perform this Agreement in the same manner and to
the same extent that the Company would be required to perform it if no such
succession had taken place.
6.03. Notices. Any notice required or permitted hereunder shall be in
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writing and shall be sufficiently given if personally delivered or if sent by
telegram or telex or by registered or certified mail, postage prepaid, with
return receipt requested, addressed: (a) in the case of the Company to
Renaissance Reinsurance Ltd., Renaissance House, East Broadway, Hamilton,
Bermuda, Attention: Secretary, or to such other address and/or to the attention
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of such other person as the Company shall designate by written notice to
Executive; and (b) in the case of Executive, to Executive at his then current
home address as shown on the Company's books, or to such other address as
Executive shall designate by written notice to the Company. Any notice given
hereunder shall be deemed to have been given at the time of receipt thereof by
the person to whom such notice is given.
6.04. Entire Agreement; Amendment. This Agreement contains the
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entire agreement of the parties hereto with respect to the terms and conditions
of Executive's employment and supersedes any and all prior agreements and
understandings, whether written or oral, between the parties hereto with respect
to compensation due for services rendered hereunder. This Agreement may not be
changed or modified except by an instrument in writing signed by both of the
parties hereto.
6.05. Waiver. The waiver by either party of a breach of any
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provision of this Agreement shall not operate or be construed as a continuing
waiver or as a consent to or waiver of any subsequent breach hereof.
6.06. Headings. The Article and Section headings herein are for
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convenience of reference only, do not constitute a part of this Agreement and
shall not be deemed to limit or affect any of the provisions hereof.
6.07. Enforcement. If any action at law or in equity is brought by
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either party hereto to enforce or interpret any of
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the terms of this Agreement, the prevailing party shall be entitled to
reimbursement by the other party of the reasonable costs and expenses incurred
in connection with such action (including reasonable attorneys' fees), in
addition to any other relief to which such party may be entitled. Executive
shall have no right to enforce any of his rights hereunder by seeking or
obtaining injunctive or other equitable relief and acknowledges that damages are
an adequate remedy for any breach by the Company of this Agreement.
6.08. Governing Law. This Agreement shall be governed by, and
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construed and interpreted in accordance with, the internal laws of Bermuda
without reference to the principles of conflict of laws. The parties submit to
the non-exclusive jurisdiction of the courts of Bermuda.
6.09. Agreement to Take Actions. Each party to this Agreement shall
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execute and deliver such documents, certificates, agreements and other
instruments, and shall take such other actions, as may be reasonably necessary
or desirable in order to perform his or its obligations under this Agreement or
to effectuate the purposes hereof.
6.10. No Mitigation; No Offset. Executive shall not be required to
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mitigate damages or the amount of any payment provided for under this Agreement
by seeking (and, without limiting the generality of this sentence, no payment
otherwise required under this Agreement shall be reduced on account of) other
employment or otherwise, and payments under this Agreement shall not be subject
to offset in respect of any claims which the Company may have against Executive.
6.11. Attorneys' Fees. Each party to this Agreement will bear its
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own expenses in connection with any dispute or legal proceeding between the
parties arising out of the subject matter of this Agreement, including any
proceeding to enforce any right or provision under this Agreement.
6.12. Termination; Survivorship. This Agreement shall terminate upon
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termination of the Executive's employment, except that the respective rights and
obligations of the parties under this Agreement as set forth herein shall
survive any termination of this Agreement to the extent necessary to the
intended preservation of such rights and obligations.
6.13. Validity. The invalidity or unenforceability of any provision
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or provisions of this Agreement shall not affect the validity or enforceability
of any other provision or provisions of this Agreement, which shall remain in
full force and effect.
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6.14. Other Agreements. Executive represents and warrants to the
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Company that to the best of his knowledge, neither the execution and delivery of
this Agreement nor the performance of his duties hereunder violates or will
violate the provisions of any other agreement to which he is a party or by which
he is bound.
6.15. Subsidiaries, etc. (a) The obligations of the Company under
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this Agreement may be satisfied by any subsidiary or affiliate of the Company
for which Executive serves as an employee under this Agreement, to the extent
such obligations relate to Executive's employment by such subsidiary or
affiliate.
(b) The rights of the Company under this Agreement may be
enforced by any Subsidiary or affiliate of the Company for which Executive
serves as an employee under this Agreement, to the extent such rights relate to
Executive's employment by such subsidiary or affiliate.
6.16. Counterparts. This Agreement may be executed in one or more
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counterparts, each of which shall be deemed to be an original but all of which
together will constitute one and the same instrument.
IN WITNESS WHEREOF, the Company and Executive have duly executed this
Agreement as of the date first above written.
RENAISSANCE REINSURANCE LTD.
By: _______________________________________
Name:
Title:
___________________________________________
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