Company: MHLA
Filing Date: 2025-03-26
Form Type: DEFM14A
Source: 0001104659-25-028254
Chunk: 280

Company: Maiden Holdings, Ltd.
Filing Date: 2025-03-26
Form: DEFM14A
Chunk 280
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, the participant will recognize ordinary income with respect to the shares when the shares are received rather than at the time the forfeiture restrictions lapse. The amount of income recognized will be equal to the fair market value of the restricted shares at such time (valued without taking the restrictions into account) over the price paid for such award, if any, and Bermuda NewCo will be eligible to receive a corresponding deduction. By making a “Section 83(b) election,” the participant will recognize no additional compensation income with respect to the shares when the forfeiture restrictions lapse, and will instead recognize short-term or long-term capital gain or loss with respect to the shares when they are sold. If, however, the shares are subsequently forfeited to us, the participant will not be eligible to claim a loss with respect to the shares to the extent of the income recognized by the participant upon the making of the “Section 83(b) election.” To make a “Section 83(b) election,” a participant must file an appropriate form of election with the Internal Revenue Service and with his or her employer, each within 30 days after the restricted shares are received, and the participant must also attach a copy of his or her election to his or her federal income tax return for the year in which the shares are received.

There generally will be no U.S. federal income tax consequences to the participant or Bermuda NewCo upon the grant of performance awards (unless the participant makes a “Section 83(b) election” under the Code), restricted share unit awards or deferred cash awards. Participants generally will recognize taxable income at the time when such awards are paid or settled in an amount equal to the aggregate amount of cash and the fair market value of shares acquired. Bermuda NewCo will generally be eligible to receive a tax deduction equal to the amount includible in the participant’s income.

Section 409A of the Code imposes restrictions on non-qualified deferred compensation. Failure to satisfy these rules results in accelerated taxation, an additional tax to the holder of the amount equal to 20% of the deferred amount, and a possible interest charge. Share options and SARs granted with an exercise price that is not less than the fair market value of the underlying shares on the date of grant will not give rise to “deferred compensation” for this purpose unless they involve additional deferral features. Share options and SARs that would be awarded under the Bermuda NewCo equity plan are intended to be eligible for this exception. Other awards may be subject to Section 409A depending on the specific nature and