Exhibit 10.14
SECOND AMENDMENT TO EMPLOYMENT
AGREEMENT
Second amendment (“
Amendment ”), dated as of November 24, 2008, to
Employment Agreement, dated as of October 23, 2001 (as amended
November 16, 2005, the “ Agreement ”),
between Arch Capital Group Ltd., a Bermuda company (the “
Company ”), and Marc Grandisson (the “
Executive ”). Capitalized terms used without
definition herein have the meanings given to them in the
Agreement.
NOW, THEREFORE, in consideration of
the premises and mutual covenants contained herein, the parties
have agreed to amend the Agreement as follows:
1.
The definition of “Good
Reason” set forth in Section 1.01 shall be hereby
amended and restated as follows:
“Good
Reason” means,
without the Executive’s written consent and subject to the
timely notice requirement and the Company’s opportunity to
cure set forth in Section 5.05 below, (a) the material
diminution of any material duties or responsibilities of the
Executive; or (b) a material reduction in the
Executive’s Base Salary.
2.
The last sentence of
Section 4.04 shall be hereby amended and restated as
follows:
In addition, the
Company will reimburse the Executive, on an after-tax basis, for
his reasonable expenses incurred in traveling between Bermuda and
Canada during the Employment Period, and such reimbursement shall
be made promptly, but in no event later than the end of the
calendar year following the calendar year during which the expense
was incurred by the Executive.
3.
Section 5.02 shall be hereby
amended and restated as follows:
SECTION 5.02. Unjustified
Termination . Except as otherwise provided in
Section 12.14, if the Employment Period shall be terminated
(i) at the end of the Employment Period due to the Company
giving written notice of non-extension pursuant to
Section 5.01 above, or (ii) prior to the expiration of
the original term (or the Employment Period as extended pursuant to
Section 5.01) by the Executive for Good Reason or by the
Company not for Cause (such terminations under clauses (i) and
(ii) of this Section 5.02 are collectively referred to as
“ Unjustified Terminations ”), the Executive
shall be paid solely (except as provided in Section 5.04 below
or as specifically provided in the Company’s Incentive
Compensation Plan or successor plan) an amount equal to his annual
Base Salary, provided the Executive shall be entitled to such
payments only if the Executive has not breached and does not breach
the provisions of Sections 6.01, 7.01, 8.01, 9.01 or 9.02 and the
Executive has entered into a general release of claims reasonably
satisfactory to the Company on or before the date that is fifty
(50) days following the Date of Termination and does not revoke
such release prior to the end of the statutory seven (7) day
revocation period. Subject to Section 12.14 below,
such
amounts will be paid in twelve (12)
equal installments, the first two (2) of which shall be paid
on the date that is two (2) months following the Date of
Termination and the next ten (10) of which will be paid in ten
(10) equal monthly installments commencing on the date that is
three (3) months following the Date of Termination and
continuing on each of the next nine (9) monthly anniversaries
of the Date of Termination. In addition, promptly following
an Unjustified Termination, the Executive shall also be reimbursed
for all Reimbursable Expenses incurred by the Executive prior to
such Unjustified Termination. Notwithstanding any provision
hereof to the contrary, in order for the Executive to terminate the
Employment Period for Good Reason, such termination of employment
must occur no later than sixty (60) days after the date the
Executive gives written notice in accordance with Section 5.05
below to the Company of the occurrence of the event or condition
that constitutes Good Reason. Notwithstanding any provision
of this Agreement to the contrary, for purposes of this
Section 5.02 and the last sentence of Section 5.04, the
Executive will be deemed to have terminated his employment on the
date of his “separation from service” (within the
meaning of Treasury Regulation Section 1.409A-1(h)) with the
Company, the Employment Period will be deemed to have ended on the
date of his “separation from service” with the Company,
and the Date of Termination will be deemed to be the date of his
“separation from service” with the Company.
4.
The last sentence of
Section 5.04 shall be hereby amended and restated as
follows:
Notwithstanding the foregoing, if
such Justified Termination is a result of a Permanent Disability or
if the Employment Period is terminated as a result of an
Unjustified Termination, the Executive shall continue to receive
his major medical insurance coverage benefits from the
Company’s plan in effect at the time of such termination for
a period equal to the lesser of (i) twelve (12) months after
the Date of Termination, and (ii) until the Executive is
provided by another employer with benefits substantially comparable
(with no pre-existing condition limitations) to the benefits
provided by such plan.
5.
Section 5.05 shall be hereby
amended and restated as follows:
SECTION 5.05. Notice
of Termination and Opportunity to Cure . Any termination
by the Company for Permanent Disability or Cause or without Cause
or by the Executive for Good Reason shall be communicated by
written Notice of Termination to the other party hereto. For
purposes of this Agreement, a “ Notice of Termination
” shall mean a notice which shall indicate the date the
termination is to take effect (consistent with the terms of this
Agreement), the specific termination provision in this Agreement
relied upon and, for a termination for Permanent Disability or for
Cause or f
