OneBeacon Insurance
Group, Ltd.
Long-Term Incentive
Plan
2008-2010 Performance
Share Grant
THIS GRANT (this
“Grant”) is made, effective as of February 26,
2008, between OneBeacon Insurance Group, Ltd., a Bermuda company
limited by shares (the “Company”) and
(the “Participant”).
RECITALS:
WHEREAS, the
Company has adopted the Long-Term Incentive Plan
(“Plan”), which Plan is incorporated herein by
reference and made part of this Grant; and
WHEREAS, the Board
has determined that it would be in the best interest of the Company
and its owners to grant the award provided for herein to the
Participant pursuant to the Plan and the terms set forth
herein.
NOW THEREFORE, for
good and valuable consideration the receipt and sufficiency of
which are hereby acknowledged, the parties hereto agree as
follows:
1.
Grant : Subject to the terms and conditions of the
Plan and the additional terms and conditions set forth in this
Grant, the Company hereby grants to the Participant a Performance
Share Award of
shares.
2.
Award Period: The Award Period shall be
January 1, 2008 through December 31, 2010.
3.
Performance Objective : The Performance Objective
shall be annual 11% growth in intrinsic business value per share
for the Company (“GIBVPS”), which shall be measured by
blending the following metrics during the Award Period, in the
referenced percentages: (a) Underwriting Return on Equity
including an adjustment to normalize catastrophe losses across
years (50%), and (b) Growth in Adjusted Book Value per Common
Share including an adjustment for dividends paid (50%).
4.
Performance Percentage: The Performance Percentage
shall be dependent on the extent to which the Performance Objective
is attained, and shall be determined as follows:
|
GIBVPS
|
|
Performance
Percentage
|
|
|
4% or lower
|
|
0%
|
|
|
11%
|
|
100%
|
|
|
18% or
higher
|
|
200%
|
|
For GIBVPS between 4%
and 18%, the Performance Percentage will be determined on the basis
of straight line interpolation.
1
5.
Award Payment: Subject to all terms and conditions of
the Plan, the Participant’s actual value at the end of the
Award Period will be settled in cash, in shares of the
Company’s common stock (“Shares”), or partly in
cash and partly in Shares, as determined by the Committee. If
settled entirely or partially in cash, the cash value will be
(a) the number of Performance Shares granted, times
(b) the Performance Percentage, times (c) the market
value of the Shares on the date that the Compensation Committee
certifies the Performance Percentage times (d) the percentage
of the Award settled in cash; and the number of Shares issued will
be (a) the number of Performance Shares granted times
(b) the Performance Percentage times (c) the percentage
of the Award settled in Shares. If settled entirely in
Shares, the number of Shares issued will be (a) the number of
Performance Shares granted, times (b) the Performance
Percentage.
6.
Termination of Employment : Except as provided in
Section 7 of the Plan, this Award shall be canceled, and no
payment shall be payable hereunder, if the Participant’s
continuous employment or Related Employment with the Company shall
terminate for any reason prior to the end of the Award
Period.
7.
Successors and Assigns : This Grant shall inure to the
benefit of and be binding upon the Company and its successors and
assigns. The Company shall request any purchaser of a
business unit in which the Participant is employed (a
“Purchaser”), to fully assume the obligations of the
Company under this Grant. If a Purchaser declines to assume
such obligations, the Company shall remain obligated under the
terms of this Grant.
8.
Definitions: All terms not otherwise defined herein
shall have the same meaning as in the Plan.
9.
Withholding : The Participant agrees to make
appropriate arrangements with the Company for satisfaction of any
applicable income tax withholding requirements, including the
payment to the Company, at the termination of the Award Period (or
such earlier or later date as may be applicable under the Code), of
all such taxes and other amounts, and the Company shall be
authorized to take such action as may be necessary, in the opinion
of the Company’s counsel (including, without limitation,
withholding amounts from any compensation or other amount owing
from the Company to the Participant), to satisfy all obligations
for the payment of such taxes and other amounts.
10.
Reduction of the Award : Notwithstanding anything to
the contrary herein, the Board, in its sole discretion (but subject
to applicable law), may reduce any amounts payable to the
Participant in order to satisfy any liabilities owed to the Company
by the Participant.
11.
No Right to Continued Employment : Neither the Plan
nor this Grant sh
