Exhibit 10.25

Montpelier Reinsurance Ltd.

amended and restated deferred Compensation Plan

1.   Establishment of Plan       MONTPELIER REINSURANCE LTD., a Bermuda
corporation, hereby establishes the Montpelier Reinsurance Ltd. Deferred
Compensation Plan (the “Plan”), effective as of 31 December 2003, to permit
eligible employees to defer the receipt of compensation otherwise payable to
such eligible employees in accordance with the terms of the Plan. The Plan is
unfunded and is maintained primarily for the purpose of providing deferred
compensation to a select group of management or highly compensated employees.  
2.   Definitions   2.1   “Account” means the bookkeeping accounts established
pursuant to Section 6.1 and maintained by the Administrator in the names of the
respective Participants, to which all amounts deferred, Company Contributions
and earnings allocated under the Plan shall be credited, and from which all
amounts distributed under the Plan shall be debited.   2.2   “Administrator”
means the Board or the person or person(s) appointed by the Board.   2.3  
“Affiliate” means, with respect to a Person, a Person that directly or
indirectly controls, or is controlled by, or is under common control with such
Person.   2.4   “Annual Bonus” means the amount identified by the Company as a
cash bonus earned by an Eligible Employee based on achievement of individual and
Company performance goals.   2.5   “Base Salary” means an Eligible Employee’s
regular salary.   2.6   “Board” means the Board of Directors of the Company.  
2.7   “Code” means the Internal Revenue Code of 1986, as amended.   2.8  
“Company” means Montpelier Reinsurance Ltd.   2.9   “Company Contributions”
means amounts contributed by the Company to the Plan.   2.10   “Compensation”
means the Base Salary and Annual Bonus earned by an Eligible Employee.

 

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2.11   “Earnings Rate” means the investment gains and losses, as determined by
the Administrator, that are applied to a Participant’s Account no less
frequently than annually.   2.12   “Election” means a written election on a form
provided by the Administrator, filed with the Administrator in accordance with
Article 3, pursuant to which an Eligible Employee (a) elects to defer a
percentage of the Compensation earned for the performance of service as an
Eligible Employee following the time that such Election is filed and (b) elects
the manner in which payments under the Plan shall be made.   2.13   “Eligible
Employee” means each employee of a Company who is a citizen of the United States
and subject to federal income taxation under the provisions of the Code and is
eligible for participation in the Plan on the date on which an Election is filed
with the Administrator.   2.14   “Hardship” means a Participant’s serious
financial hardship, as determined by the Administrator on a uniform and
nondiscriminatory basis pursuant to the Participant’s request under Section 5.3.
  2.15   “Participant”

  2.15.1   “Participant” means each individual who has an undistributed amount
credited to an Account under the Plan.     2.15.2   “Active Participant” means
each Participant who is actively employed by the Company as an Eligible
Employee.

2.16   “Period of Service” means an individuals’ period of service from such
individuals’ date of hire by the Company, a Parent Company or a Subsidiary
Company to the date of termination of employment with the Company and all parent
Companies and Subsidiary Companies.   2.17   “Person” means an individual, a
corporation, a partnership, an association, a trust or any other entity or
organization.   2.18   “Plan” means the Montpelier Reinsurance Ltd. Deferred
Compensation Plan.   2.19   “Plan Year” means the calendar year.   2.20  
“Severance Pay” means any amount identified by the Company as severance pay, or
any amount which is payable on account of periods beginning after the last date
on which an employee (or former employee) is required to report for work for the
Company.   2.21   “Termination Event” means the liquidation of the Company or a
change of control as determined by the Board.

 

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2.22   “Trust” means the trust established by the Company to hold the funds of
the Plan and “Trustee” means the trustee or trustees fro the time being of the
Trust.   3.   Election to Defer Compensation   3.1   General

  3.1.1   Election. Each Eligible Employee shall have the right to defer a
percentage of the aggregate Compensation which he or she may earn in a Plan Year
by filing an Election at the time and in the manner described in this Article 3;
provided that Severance Pay shall not be included as “Compensation” for purposes
of this Article 3 and provided further that an Eligible Employee may file
separate Elections for Base Salary and Annual Bonus. In addition, on the first
such Election (unless the Company shall provide otherwise), the Eligible
Employee shall elect the form in which benefits payable under the Plan shall be
paid, as further set forth in Section 5.1.     3.1.2   Withholding of
Compensation Subject to an Election. Except as the Company may otherwise
provide, the amount of Compensation deferred by a Participant for a Plan Year
pursuant to an Election shall be withheld on a pro-rata basis from each periodic
payment of the Participant’s Compensation (in accordance with the general pay
practices of the Company) and credited to the Participant’s Account in
accordance with Section 6.1, provided that separate Elections may apply to Base
Salary and Annual Bonus.     3.1.3   Irrevocability of Election. Any Election
with respect to a Plan Year filed pursuant to this Article 3 shall be
irrevocable; provided that the form of distribution may be modified in
accordance with the rules prescribed in Section 5.2.

3.2   Filing of Elections. The Election shall be made on the form provided by
the Administrator for this purpose. Except as provided in Section 3.3 or
otherwise by the Administrator, no Election with respect to Base Salary or
Annual Bonus shall be effective unless it is filed with the Administrator on or
before the close of business on December 31 preceding the Plan Year as to which
the Election applies.   3.3   Filing of Elections for First Year as an Eligible
Employee. Notwithstanding Section 3.2, in the Plan year an employee first
becomes an Eligible Employee, the Eligible Employee may elect to defer all or
any portion of his or her Compensation to be earned in such Plan Year beginning
with the payroll period next following the filing of an Election with the
Administrator and before the close of such Plan Year, by making and filing the
Election with the Administrator within 30 days of the date such employee becomes
an

 

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    Eligible Employee. Elections by such Eligible Employee for succeeding Plan
years shall otherwise be made in accordance with Section 3.1 and Section 3.2.  
3.4   Plan Years to which Elections May Apply. A separate Election may be made
for each Plan Year as to which an Eligible Employee desires to defer all or any
portion of his or her Compensation, but the failure of an Eligible Employee to
make an Election for any Plan Year shall not affect such Eligible Employee’s
right to make an Election for any other Plan Year.   4.   Vesting       Vesting
in Deferrals. Participants will be immediately vested in their deferrals under
Section 3.1.   5.   Distributions   5.1   Distribution Date and Form of
Distribution. The vested amount credited to a Participant’s Account shall be
distributed beginning as soon as practicable following the earlier of the date
designated by the employee in his or her Election or the date the employee
terminates employment. Distribution shall be made in either a single lump sum or
in installments over not more than ten years, as elected by the Participant
pursuant to the initial Election, in accordance with Section 3.1.1.   5.2  
Modification of Election as to Form of Distribution. Each Active Participant who
has previously made an Election may elect to change the form of distribution by
filing an Election (“Modification Election”) with the Administrator on or before
the close of the Plan Year preceding the Plan Year in which the distribution
would otherwise be made. In the event the Active Participant terminates
employment prior to the end of the Plan Year in which the Modification Election
is made, the form of distribution shall be the form of distribution elected by
the Active Participant prior to the Modification Election.   5.3   Hardship
Distributions. Notwithstanding the terms of an Election, if, at the
Participant’s request, the Administrator determines that the Participant has
incurred a Hardship, the Board may, in its discretion, authorize the immediate
distribution of the portion of the Participant’s Account reasonably needed to
satisfy the Hardship.   6.   Book Accounts   6.1   Establishment of Account. An
Account shall be established for each Eligible Employee when such Eligible
Employee becomes a Participant. Compensation deferred pursuant to the Plan shall
be credited to the Account on the date such Compensation would otherwise have
been payable to the Participant. Company Contributions shall be credited to the

 

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    Accounts as of the last day of each Plan Year, or more frequently, as
determined by the Administrator. Earnings shall be credited to the Account as
provided in Section 6.2.   6.2   Crediting of Earnings on Accounts. The
Administrator shall credit Accounts, not less frequently than annually, with
income, gains and losses at the Earnings Rate, including during the period
extending from a Participant’s employment termination date to the date the
Participant’s Account is distributed in full; provided that the Administrator
may provide that the Earnings Rate for the Account of Participants who are
receiving installment distributions may be different from the Earnings Rate
applied to the Accounts of Active Participants.   6.3   Status of Deferred
Amounts. Regardless of whether or not the Company is a Participant’s employer,
all Compensation deferred under this Plan shall continue for all purposes to be
a part of the general funds of the Company.   6.4   Participants’ Status as
General Creditors. Regardless of whether or not the Company is a Participant’s
employer, an Account shall at all times represent the general obligation of the
Company. The Participant shall be a general creditor of the Company with respect
to this obligation, and shall not have a secured or preferred position with
respect to his or her Accounts. Nothing contained herein shall be deemed to
create an escrow, trust, custodial account or fiduciary relationship of any
kind.   6.5   Nothwithstanding the foregoing, the assets of the Plan will be
held, invested and disposed of by the Trustee in accordance with these Rules to
the extent they do not conflict with any of the trusts, powers or provisions of
the Trust. In case of any conflict between these Rules and the trusts, powers or
provisions of the Trust, the Trust shall prevail.   7.   Non-Assignability, etc.
      The right of each Participant in or to any Account, benefit or payment
hereunder shall not be subject in any manner to attachment or other legal
process for the debts of such Participant; and no Account, benefit or payment
shall be subject to anticipation, alienation, sale, transfer, assignment or
encumbrance.   8.   Death of Participant   8.1   Death before Commencement of
Distributions. If a Participant’s employment is terminated by reason of death
before the distribution of any portion of his Account has begun, the Company
shall, within ninety (90) days of the date of such termination distribute the
Account to the beneficiary or beneficiaries selected by the Participant.
Distributions under this Section 8.1 shall be made in a single sum.

 

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8.2   Designation of Beneficiaries. Each Participant shall have the right to
designate one or more beneficiaries to receive distributions in the event of the
Participant’s death by filing with the Administrator a beneficiary designation
on the form provided by the Administrator for such purpose. The designation of
beneficiary or beneficiaries may be changed by a Participant at any time prior
to his or her death by the delivery to the Administrator of a new beneficiary
designation form. If no beneficiary shall have been designated, or if no
designated beneficiary shall survive the Participant, the Participant’s estate
shall be deemed to be the beneficiary.   9.   Interpretation       The Board
shall have full and exclusive authority to construe, interpret and administer
this Plan and the Board’s construction and interpretation thereof shall be
binding and conclusive on all persons for all purposes.   10.   Terminating
Event       The Administrator shall give Participants at least thirty (30) days’
notice (or, if not practicable, such shorter notice as may be reasonably
practicable) prior to the anticipated date of a Terminating Event. The
Administrator may, in its discretion, provide in such notice that
notwithstanding any other provision of the Plan or the terms of any Election,
upon the consummation of a Terminating Event, the Account balance of each
Participant shall be distributed in full.   11.   Amendment or Termination      
The Company, by action of the Board or the Administrator, reserves the right at
any time, or from time to time, to amend or modify this Plan. The Company, by
action of the Board, reserves the right at any time, or from time to time, to
terminate this Plan.   12.   Miscellaneous Provisions   12.1   No Right to
Continued Employment. Nothing contained herein shall be construed as conferring
upon any Participant the right to remain in the employment of the Company as an
executive or in any other capacity.   12.2   Governing Law. This Plan shall be
interpreted under the laws of the State of Delaware in the United States, except
to the extent such law is pre-empted by federal law in the United States.  
13.   Effective Date       The effective date of the Plan is 31 December 2003.