Exhibit 10.2
FORM OF NON-QUALIFIED STOCK
OPTION AGREEMENT
THIS AGREEMENT, made this 17th day
of February, 2009 (the “ Grant Date ”),
by and between Max Capital Group Ltd. (the “
Company ”) and W. Marston Becker (the “
Optionee ”).
W I T N E S S E T H
:
WHEREAS, pursuant to the Max Capital
Group Ltd. 2008 Stock Incentive Plan, as amended (the “
Plan ”), the Company desires to afford the
Optionee the opportunity to acquire, or enlarge, his ownership of
the Company’s common shares, $1.00 par value per share
(“ Common Shares ”), so that he may have
a direct proprietary interest in the Company’s
success.
NOW, THEREFORE, in consideration of
the covenants and agreements herein contained, the parties hereto
hereby agree as follows:
1. Grant of Option .
Subject to the terms and conditions set forth herein and in the
Plan, the Company hereby grants to the Optionee, during the period
commencing on the date of this Agreement and ending on the close of
business on the day of the tenth anniversary of the date hereof
(the “ Termination Date ”), the right and
option (the right to purchase any one Common Share hereunder being
an “ Option ”) to purchase from the
Company, at a price of $18.25 per share (the “ Option
Price ”), an aggregate of 108,333 Common Shares (the
“ Option Shares ”).
2. Limitation on Exercise of
Option . Subject to the terms and conditions set forth
herein and the Plan:
(a) Optionee will become vested in
50% of the Options on January 1, 2010; provided ,
that , the book value of the underlying Common Shares on
December 31, 2009 is at least 12.5% greater than the book
value of such Common Shares on December 31, 2008 (the book
value of Common Shares on December 31, 2008 calculated by
dividing Total Shareholders’ Equity by Common Shares Issued
and Outstanding shall be referred to herein as “
Baseline 1 ,” and the amount which is 12.5%
greater than Baseline 1 shall be referred to herein as “
Baseline 2 ”); provided , further
that , the Optionee is employed by the Company on the
relevant vesting date (“ Tranche 1 Options
”).
(b) Optionee will become vested in
50% of the Options on January 1, 2011; provided ,
that , the book value of the underlying Common Shares on
December 31, 2010 is at least 12.5% greater than Baseline 2
(such amount, “ Baseline 3 ” and such
Options, “ Tranche 2 Options ”),
provided , further that , the Optionee is
employed by the Company on the relevant vesting date. If Tranche 1
Options do not vest on January 1, 2010, but Baseline 3 is at
least 25% greater than Baseline 1, then Tranche 1 Options and
Tranche 2 Options shall become vested as of
1
January 1, 2011; provided ,
that , the Optionee is employed by the Company on the
relevant vesting date. For the avoidance of doubt, if any tranche
of Options is unvested as of January 1, 2011, such tranche
shall automatically terminate and cease to be exercisable and shall
not be considered outstanding for any purpose.
Notwithstanding the foregoing, if on
or prior to January 1, 2011, the Optionee’s employment
with the Company is terminated: (i) by the Company without
Cause (as defined in the Employment Agreement between the Company
and W. Marston Becker effective November 13, 2006, as may be
amended from time to time (the “ Employment
Agreement ”)); (ii) by the Optionee for Good
Reason (as defined in the Employment Agreement); or
(iii) following a Change in Control (as defined in the
Employment Agreement), the unvested portion of the Options that are
still outstanding shall automatically vest and become
exercisable.
For purposes of this Agreement,
Total Shareholder’s Equity and Common Shares Issued and
Outstanding shall be as set forth in the consolidated balance sheet
of the Company’s audited consolidated financial statements
for the applicable year ended December 31.
3. Termination of
Employment . Any Options held by the Optionee upon
termination of employment shall remain exercisable as follows,
subject to the conditions set forth in Section 4
hereof:
(a) Except as provided in
Section 2 hereof, upon Optionee’s termination of
employment for any reason, all unvested Options shall terminate and
cease to be exercisable.
(b) If the Optionee’s
termination of employment is due to death or Disability (as defined
in the Employment Agreement), all unvested Options shall
automatically terminate and cease to be exercisable and, to the
extent vested, all vested Options shall be exercisable by the
Optionee or any prior transferee of the Option or by the
Optionee’s designated beneficiary, or, if none, the person(s)
to whom such Optionee’s rights under the Option are
transferred by will or the laws of descent and distribution for one
(1) year following such termination of employment (but in no
event beyond the Termination Date), and shall thereafter terminate;
and
(c) If the Optionee’s
termination of employment is for any other reason, all unvested
Options shall terminate and cease to be exercisable on the date of
termination; and all vested Options, shall be exercisable for a
period of 90 days following such termination of employment (but in
no event beyond the Termination Date), and shall thereafter
terminate. An Optionee’s status as an employee shall not be
considered terminated in the case of a leave of absence agreed to
in writing by the Company (including, but not limited to, military
and sick leave); provided , that , such leave is for
a period of not more than 90 days or re-employment upon expiration
of such leave is guaranteed by contract or statute.
4. Method of Exercising
Option .
(a) Payment of Option Price .
Options, to the extent vested, may be exercised, in whole or in
part, by giving written notice of exercise to the Company
specifying the number of Common Shares to be purchased. Such notice
shall be accompanied by the payment in full of the Option
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