EMPLOYMENT AGREEMENT

This Employment Agreement (this “Agreement”), is dated as of September 27, 2007
and is entered into between Endurance Specialty Holdings Ltd. (the “Company”),
and [Name of Executive] (the “Executive”).

WHEREAS, the Company desires to enter into this Agreement in order to embody the
terms of the Executive’s continued employment and the Executive desires to enter
into this Agreement and to accept such continued employment, subject to the
terms and provisions of this Agreement.

NOW, THEREFORE, in consideration of the premises and the mutual agreements
contained herein, the Company and the Executive hereby agree as follows:

ARTICLE I.

Definitions

1.1 “Board” shall mean the Board of Directors of the Company.

1.2 “Business” shall mean the brokerage, underwriting, advising or consulting of
or with respect to any line of property or casualty insurance or reinsurance
underwritten by the Company or any of its subsidiaries or affiliates as an
insurer or reinsurer during the Term.

1.3 “Cause” shall mean:

(a) any intentional act of fraud, embezzlement or theft by the Executive in
connection with his duties hereunder or in the course of his employment
hereunder or the Executive’s admission or conviction of, or plea of nolo
contendere to either, (i) a felony or (ii) a crime involving moral turpitude,
fraud, embezzlement, theft or misrepresentation;

(b) any gross negligence or willful misconduct of the Executive resulting in a
loss to the Company or any of its subsidiaries or affiliates;

(c) any breach by the Executive of any one or more of the covenants contained in
Section 5.2, 5.3, 5.4 or 5.5 hereof, provided the Executive has received 15
calendar days’ prior written notice of such breach in accordance with Section
7.3 of this Agreement; or

(d) any violation of any statutory or common law duty of loyalty to the Company
or any of its subsidiaries or affiliates.

1.4 “Change in Control” shall mean:

(a) the acquisition by any individual, entity or group (a “Person”), including
any “person” within the meaning of Section 13(d)(3) or 14(d)(2) of the
Securities Exchange Act of 1934, as amended (the “Exchange Act”), of beneficial
ownership within the meaning of Rule 13d-3 promulgated under the Exchange Act,
of 50% or more of either

 

 

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(i) the then outstanding ordinary shares, par value $1.00 per share, of the
Company (the “Outstanding Ordinary Shares”) or (ii) the combined voting power of
the then outstanding securities of the Company entitled to vote generally in the
election of directors pursuant to the Bye-Laws of the Company (the “Outstanding
Voting Securities”); excluding, however, the following: (A) any acquisition
directly from the Company (excluding any acquisition resulting from the exercise
of an exercise, conversion or exchange privilege unless the security being so
exercised, converted or exchanged was acquired directly from the Company), (B)
any acquisition by the Company, (C) any acquisition by an employee benefit plan
(or related trust) sponsored or maintained by the Company or any corporation
controlled by the Company or (D) any acquisition by any corporation pursuant to
a transaction which complies with clauses (i), (ii) and (iii) of subsection (c)
of this definition of Change in Control; provided, further, that for purposes of
clause (B), if any Person (other than the Company or any employee benefit plan
(or related trust) sponsored or maintained by the Company or any corporation
controlled by the Company) shall become the beneficial owner of 50% or more of
the Outstanding Ordinary Shares or 50% or more of the Outstanding Voting
Securities by reason of an acquisition by the Company, and such Person shall,
after such acquisition by the Company, become the beneficial owner of any
additional Outstanding Ordinary Shares or any additional Outstanding Voting
Securities and such beneficial ownership is publicly announced, such additional
beneficial ownership shall constitute a Change in Control;

(b) individuals who, as of the date hereof, constitute the Board (the “Incumbent
Board”) cease for any reason to constitute at least a majority of such Board
within a 24 month period; provided, that any individual who becomes a director
of the Company subsequent to the date hereof whose election, or nomination for
election by the Company’s shareholders, was approved by the vote of at least a
majority of the directors then comprising the Incumbent Board shall be deemed a
member of the Incumbent Board; and provided, further, that any individual who
was initially elected as a director of the Company as a result of an actual or
threatened solicitation by a Person other than the Board for the purpose of
opposing a solicitation by any other Person with respect to the election or
removal of directors, or any other actual or threatened solicitation of proxies
or consents by or on behalf of any Person other than the Board shall not be
deemed a member of the Incumbent Board;

(c) the consummation of a reorganization, amalgamation, merger or consolidation
or sale or other disposition of all or substantially all of the assets of the
Company (a “Corporate Transaction”); excluding, however, a Corporate Transaction
pursuant to which (i) all or substantially all of the individuals or entities
who are the beneficial owners, respectively, of the Outstanding Ordinary Shares
and the Outstanding Voting Securities immediately prior to such Corporate
Transaction will beneficially own, directly or indirectly, more than 55% of,
respectively, the outstanding shares of common stock, and the combined voting
power of the outstanding securities entitled to vote generally in the election
of directors, as the case may be, of the corporation resulting from such
Corporate Transaction (including, without limitation, a corporation which as a
result of such transaction owns the Company or all or substantially all of the
Company’s assets either directly or indirectly) in substantially the same
proportions relative to each other as their ownership, immediately prior to such
Corporate Transaction, of the

 

 

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Outstanding Ordinary Shares and the Outstanding Voting Securities, as the case
may be, (ii) no Person (other than: the Company; any employee benefit plan (or
related trust) sponsored or maintained by the Company or any corporation
controlled by the Company; the corporation resulting from such Corporate
Transaction; and any Person which beneficially owned, immediately prior to such
Corporate Transaction, directly or indirectly, 50% or more of the Outstanding
Ordinary Shares or the Outstanding Voting Securities, as the case may be) will
beneficially own, directly or indirectly, 50% or more of, respectively, the
outstanding shares of common stock of the corporation resulting from such
Corporate Transaction or the combined voting power of the outstanding securities
of such corporation entitled to vote generally in the election of directors and
(iii) individuals who were members of the Incumbent Board will constitute at
least a majority of the members of the board of directors of the corporation
resulting from such Corporate Transaction; or

(d) the consummation of a plan of complete liquidation or dissolution of the
Company.

1.5 “Change in Control Period” shall mean the period commencing three months
prior to the date of a Change in Control and ending on the first annual
anniversary of the date of a Change in Control.

1.6 “Code” means the Internal Revenue Code of 1986, as amended.

1.7 “Confidential Information” shall mean any confidential or proprietary
information, trade secrets, customer lists, drawings, designs, information
regarding product development, marketing plans, sales plans, manufacturing
plans, management organization information, operating policies or manuals,
business plans, financial records, packaging design or other financial,
commercial, business or technical information relating to the Company or any of
its subsidiaries or affiliates, or that the Company or any of its subsidiaries
or affiliates may have received belonging to suppliers, customers or others who
do business with the Company or any of its subsidiaries or affiliates.

1.8 “Date of Termination” shall mean the following:

(a) if the Executive’s employment is terminated for Cause, the date specified in
the Notice of Termination;

(b) if the Executive’s employment is terminated by the Executive’s death, the
date of the Executive’s death;

(c) if the Executive’s employment is terminated for Disability, 15 calendar days
after the Notice of Termination is given (provided that the Executive shall not
have returned to the full-time performance of the Executive’s duties during such
15 calendar day period);

(d) if the Executive’s employment is terminated by the Executive with Good
Reason, 30 calendar days after the Notice of Termination is given (provided that
the

 

 

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Company shall not have cured the event giving rise to the Executive’s right to
termination for Good Reason during such 30 calendar day period);

(e) if the Executive’s employment is terminated by the Company by delivery of a
notice of non-renewal of this Agreement pursuant to Section 3.1 with respect to
a Renewal Date occurring within a Change in Control Period, such Renewal Date;
and

(f) if the Executive’s employment is terminated by the Executive or the Company
for any other reason, the date specified in the Notice of Termination (which, in
the case of a termination by the Executive, shall not be less than 14 calendar
days nor more than 30 calendar days from the date such Notice of Termination is
given).

1.9 “Disability” shall mean any condition which (i) prevents the Executive from
substantially performing his duties under this Agreement for a period of at
least 120 consecutive days, or 180 non-consecutive days within any 365-day
period, and (ii) causes the Executive to become eligible for the Company’s
long-term disability plan.

1.10 “Good Reason” shall mean:

(a) a material diminution in (i) the Executive’s Base Salary, (ii) the
Executive’s authority, duties or responsibilities, (iii) the authority, duties
or responsibilities of the Executive’s Direct Supervisor or (iv) the budget over
which the Executive retains authority;

(b) a material change in the geographic location at which the Executive must
perform his services on behalf of the Company; or

(c) any other action or inaction that constitutes a material breach by the
Company of this Agreement.

1.11 “Maximum Annual Incentive Compensation Percentage” shall mean the
percentage set forth as the Maximum Annual Incentive Compensation Percentage in
Exhibit A, subject to adjustment from time to time by the Board; provided that
any such adjustment shall not cause the sum of the Maximum Annual Incentive
Compensation Percentage plus the Maximum Long-Term Compensation Percentage to be
lower than the sum of the Maximum Annual Incentive Compensation Percentage plus
the Maximum Long-Term Compensation Percentage set forth in Exhibit A.

1.12 “Maximum Long-Term Incentive Compensation Percentage” shall mean the
percentage set forth as the Maximum Long-Term Incentive Compensation Percentage
in Exhibit A, subject to adjustment from time to time by the Board; provided
that any such adjustment shall not cause the sum of the Maximum Annual Incentive
Compensation Percentage plus the Maximum Long-Term Compensation Percentage to be
lower than the sum of the Maximum Annual Incentive Compensation Percentage plus
the Maximum Long-Term Compensation Percentage set forth in Exhibit A.

1.13 “Notice of Termination” shall mean a notice that shall indicate the
specific termination provision in this Agreement relied upon and shall set forth
in reasonable detail the

 

 

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facts and circumstances claimed to provide a basis for termination of the
Executive’s employment under the provision so indicated.

1.14 “Target Annual Incentive Compensation Percentage” shall mean the percentage
set forth as the Target Annual Incentive Compensation Percentage in Exhibit A,
subject to adjustment from time to time by the Board; provided that any such
adjustment shall not cause the sum of the Target Annual Incentive Compensation
Percentage plus the Target Long-Term Compensation Percentage to be lower than
the sum of the Target Annual Incentive Compensation Percentage plus the Target
Long-Term Compensation Percentage set forth in Exhibit A.

1.15 “Target Long-Term Incentive Compensation Percentage” shall mean the
percentage set forth as the Target Long-Term Incentive Compensation Percentage
in Exhibit A, subject to adjustment from time to time by the Board; provided
that any such adjustment shall not cause the sum of the Target Annual Incentive
Compensation Percentage plus the Target Long-Term Compensation Percentage to be
lower than the sum of the Target Annual Incentive Compensation Percentage plus
the Target Long-Term Compensation Percentage set forth in Exhibit A.

1.16 “Term” shall mean the term of employment of the Executive with the Company,
which shall commence as of the date first written above and continue until the
earlier of (a) the first anniversary of the date first written above or (b) the
Executive’s Date of Termination, and shall be subject to successive one year
renewals in accordance with Section 3.1.

1.17 “Threshold Annual Incentive Compensation Percentage” shall mean the
percentage set forth as the Threshold Annual Incentive Compensation Percentage
in Exhibit A, subject to adjustment from time to time by the Board.

1.18 “Threshold Long-Term Incentive Compensation Percentage” shall mean the
percentage set forth as the Threshold Long-Term Incentive Compensation
Percentage in Exhibit A, subject to adjustment from time to time by the Board.

ARTICLE II.

Employment, Duties and Responsibilities

2.1 Employment. During the Term, the Company agrees to employ the Executive and
the Executive hereby agrees to be employed as a key employee of the Company upon
the terms and subject to the conditions contained in this Agreement.

2.2 Duties and Responsibilities. The Executive shall have such duties and
responsibilities during the Term as specified by the person to which the
Executive directly reports and who supervises the Executive’s work on a regular
basis (the “Direct Supervisor”). These duties and responsibilities may be
modified from time to time in a manner consistent with the Executive’s position.
The Executive agrees to serve as a director and/or officer of any subsidiary of
the Company at a level commensurate with his position as may be reasonably
requested by the Board or the Executive’s Direct Supervisor.

 

 

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2.3 Base of Operation. The Executive’s principal base of operation for the
performance of his duties and responsibilities under this Agreement shall be the
offices of the Company in [   ]; provided, however, that the Executive shall
perform such duties and responsibilities outside of [   ] as shall from time to
time be reasonably necessary to fulfill his obligations hereunder. The Company
and the Executive may at any time during the Term mutually agree to change the
principal base of operation for the performance of the Executive’s duties and
responsibilities. The Executive’s performance of any duties and responsibilities
shall be conducted in a manner consistent with any tax operating guidelines
promulgated from time to time by the Board.

ARTICLE III.

Term

3.1 Term. The employment of the Executive under this Agreement shall be for the
Term. The Term shall be extended for successive one-year periods as of each
annual anniversary date of the date first written above (each, a “Renewal Date”)
unless, with respect to any such Renewal Date, either party hereto gives the
other party at least 90 days prior written notice of its election not to so
extend the Term.

ARTICLE IV.

Compensation and Expenses

4.1 Salary, Bonuses, Incentive Awards and Benefits. As compensation and
consideration for the performance by the Executive of his obligations under this
Agreement, the Executive shall be entitled, during the Term, to the following:

(a) Base Salary. During the Term, the Company shall pay to the Executive a base
salary at the Executive’s base salary rate on the date of this Agreement,
subject to increase from time to time as determined by the Board, upon
recommendation of the Direct Supervisor, or if such Direct Supervisor is not an
officer of the Company, an officer of the Company (“Base Salary”). The
Executive’s Base Salary shall be payable in accordance with the Company’s normal
payroll procedures and shall not during the Term be reduced below the annual
rate payable to the Executive on the date of this Agreement.

(b) Annual Incentive Compensation. The Executive shall be eligible each calendar
year for incentive compensation payable in cash (“Annual Incentive
Compensation”), the amount of which shall be between the Threshold Annual
Incentive Compensation Percentage and the Maximum Annual Incentive Compensation
Percentage of the Executive’s Base Salary as of the immediately preceding
December 31st and shall be determined by the Board, upon recommendation of the
Direct Supervisor, or if such Direct Supervisor is not an officer of the
Company, an officer of the Company. The Annual Incentive Compensation shall be
based upon the performance of the Company, the Executive’s business unit and the
Executive, determined in accordance with performance criteria established by the
Board and the Direct Supervisor at the commencement of each calendar year. The
performance criteria for the determination of

 

 

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the Company portion of the Executive’s Annual Incentive Compensation for the
2007 calendar year are as set forth on Exhibit A attached hereto. The Annual
Incentive Compensation payable to the Executive upon the Company attaining the
target Company and individual performance established by the Board and the
Direct Supervisor at the commencement of each calendar year shall be the Target
Annual Incentive Compensation Percentage of the Executive’s Base Salary as of
the immediately preceding December 31st. The Annual Incentive Compensation shall
be paid to the Executive at the same time as annual incentive compensation is
paid to other employees of the Company in accordance with the Company’s normal
payroll procedures and shall be conditioned upon the Executive’s continued
employment with the Company through and including the scheduled date of payment
of annual incentive compensation by the Company to its employees generally.

(c) Equity Incentive Awards. The Executive shall also be eligible each calendar
year during the Term for incentive compensation in the form of equity incentive
awards (the “Equity Incentive Awards”), the amount of which shall be between the
Threshold Long Term Incentive Compensation Percentage and the Maximum Long-Term
Incentive Compensation Percentage of the Executive’s Base Salary as of the
immediately preceding December 31st and shall be determined by the Board, upon
recommendation of the Direct Supervisor, or if such Direct Supervisor is not an
officer of the Company, an officer of the Company. The Equity Incentive Awards
shall be based upon the performance of the Company, the Executive’s business
unit and the Executive, determined in accordance with performance criteria
established by the Board and the Direct Supervisor at the commencement of each
calendar year. The performance criteria for the determination of the Company
portion of the Executive’s Equity Incentive Award for the 2007 calendar year are
as set forth on Exhibit A attached hereto. The Equity Incentive Award
deliverable to the Executive upon the Company attaining the target Company and
individual performance established by the Board and the Direct Supervisor at the
commencement of each calendar year shall be the Target Long-Term Incentive
Compensation Percentage of the Executive’s Base Salary as of the immediately
preceding December 31st. The Equity Incentive Awards shall be delivered to the
Executive at the same time as equity incentive awards are delivered to other
employees of the Company in accordance with the Company’s normal procedures and
shall be conditioned upon the Executive’s continued employment with the Company
through and including the scheduled date of delivery of equity incentive awards
by the Company to its employees generally. The Equity Incentive Awards shall be
in a form determined by the Board, consistent with equity incentive awards to
employees of the Company generally and shall be issued in accordance with the
terms of the equity incentive plans of the Company, as amended through the date
hereof and hereafter from time to time (the “Plans”). The Executive shall enter
into separate award agreements with respect to such Equity Incentive Awards and
his rights with respect to such Equity Incentive Awards shall be governed by the
Plans and such award agreements.

(d) Housing Expense Reimbursement. The Company shall reimburse the Executive for
expenses relating to the rental and maintenance of the Executive’s residence in
Bermuda which are properly and reasonably incurred by the Executive during the
Term and are reimbursable under the Company’s housing expense reimbursement
policy, as amended from time to time. Prior to such payment the

 

 

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Executive shall provide to the Company any written substantiation for such
expenses requested by the Company. The maximum amount of rental and maintenance
expenses the Company shall reimburse the Executive pursuant to this Section
4.1(d) shall be $[   ] per 12 month period, which maximum amount shall be
prorated if the Executive’s employment with the Company terminates prior to the
scheduled expiration of the Term.

(e) Travel Reimbursement. The Company shall reimburse the Executive for travel
expenses relating to the Executive’s commutation to and from Bermuda which are
properly and reasonably incurred by the Executive during the Term and are
reimbursable under the Company’s commutation expense reimbursement policy, as
amended from time to time. Prior to such payment the Executive shall provide to
the Company any written substantiation for such expenses requested by the
Company.

(f) Tax Gross-Up. To the extent that the Executive incurs any United States
federal or state ordinary income tax liability on account of the housing expense
reimbursement and travel expense reimbursement specified in Section 4.1(d) and
(e) hereof, the Company shall reimburse the Executive for all such tax liability
incurred and all United States federal and state ordinary income tax liability
incurred as a result of the tax gross-up payments specified pursuant to this
Section 4.1(f).

(g) Tax Preparation Expense Reimbursement. The Company shall reimburse the
Executive for the reasonable cost of the preparation of the Executive’s home
country federal and state income tax returns by KPMG, or an alternate tax
preparation service provider elected by the Executive and approved by the
Company, for those calendar years falling entirely within the Term; provided
that the maximum amount of tax preparation expense reimbursable by the Company
pursuant to this sentence shall be $[   ] per annum. Prior to such payment the
Executive shall provide to the Company any written substantiation for such
expenses requested by the Company.

(h) Benefits. The Executive shall be eligible to participate in such 401(k)
savings plan, life insurance, health insurance, disability insurance and major
medical insurance benefits, and in such other employee benefit plans and
programs for the benefit of the employees and officers of the Company generally,
as may be maintained from time to time during the Term, in each case to the
extent and in the manner available to other employees of the Company, subject to
the terms and provisions of such plan or program.

(j) Vacation. The Executive shall be entitled to reasonable paid vacation
periods, in accordance with Company policy, to be taken in the Executive’s
discretion, in a manner consistent with the Executive’s obligations to the
Company under this Agreement, and subject, with respect to timing, to the
reasonable approval of the Executive’s Direct Supervisor.

(k) Indemnification/Liability Insurance. The Company shall indemnify the
Executive as required by the Bye-laws of the Company, and may maintain customary
insurance policies providing for indemnification of the Executive. In addition
to the foregoing, the Executive and the Company agree to enter into the
Indemnification Agreement attached hereto as Exhibit B concurrent with the
execution and delivery of this Agreement.

 

 

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4.2 Expenses; Other Benefits. During the Term, the Company shall provide the
Executive with the following expense reimbursements and perquisites:

(a) Business Expenses. The Company will reimburse the Executive for reasonable
business-related expenses incurred by the Executive in connection with the
performance of the Executive’s duties hereunder during the Term, subject,
however, to the Company’s policies relating to business-related expenses as in
effect from time to time.

(b) Other Benefits. The Company may also provide for or withdraw other benefits
for the Executive as it determines from time to time during the Term, consistent
with practices governing similarly situated senior executives of the Company.

4.3 Tax Withholding. The Company shall be permitted to deduct from the amounts
payable to the Executive pursuant to this Agreement the amount of taxes that the
Company is required to withhold pursuant to applicable laws, rules and
regulations.

ARTICLE V.

Exclusivity, Etc.

5.1 Exclusivity. During the Term, the Executive shall perform faithfully and
loyally and to the best of the Executive’s abilities the duties assigned to the
Executive hereunder and shall devote the Executive’s full business time,
attention and effort to the affairs of the Company and its subsidiaries and
affiliates and shall use the Executive’s reasonable best efforts to promote the
interests of the Company and its subsidiaries and affiliates. Notwithstanding
the foregoing, the Executive may engage in charitable, civic or community
activities, provided that such memberships and activities do not interfere with
the Executive’s duties hereunder or violate any of the Executives obligations
under this Agreement.

5.2 Non-Competition; Non-Solicitation.

(a) General. The Executive acknowledges that in the course of the Executive’s
employment with the Company the Executive will become familiar with trade
secrets and other confidential information concerning the Company and its
subsidiaries and affiliates and that the Executive’s services will be of
special, unique and extraordinary value to the Company and its subsidiaries and
affiliates.

(b) Non-Competition. The Executive agrees that during the Term and the period
from the Termination Date until the 6 month anniversary of the Termination Date,
the Executive shall not in any manner, directly or indirectly, through any
person, firm or corporation, alone or as a member of a partnership or as an
officer, director, stockholder, investor, broker, advisor, employee of or
consultant to any other corporation or enterprise or otherwise, engage or be
engaged, or assist any other person, firm, corporation or enterprise in engaging
or being engaged, in the Business in any geographic area in which the Company or
any of its subsidiaries or affiliates is then conducting the Business.

 

 

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(c) Non-solicitation. The Executive further agrees that during the Term and the
period from the Termination Date until the 6 month anniversary of the
Termination Date, the Executive shall not (i) in any manner, directly or
indirectly, induce or attempt to induce any employee of the Company or any of
its subsidiaries or affiliates to terminate or abandon his or her employment for
any purpose whatsoever or (ii) in connection with the Business, call on,
service, solicit or otherwise do business with any customer of the Company or
any of its subsidiaries or affiliates.

(d) Exceptions. Nothing in this Section 5.2 shall prohibit the Executive from
being (i) a stockholder in a mutual fund or a diversified investment company or
(ii) an owner of not more than two percent of the outstanding stock of any class
of a corporation, any securities of which are publicly traded, so long as the
Executive has no active participation in the business of such corporation.

5.3 Confidential Information.

(a) General. The Executive agrees that the Executive will not, at any time
during or after the Term, make use of or divulge to any other person, firm or
corporation any Confidential Information which he may have learned in connection
with his employment hereunder.

(b) Exceptions. The Executive’s obligation under this Section 5.3 shall not
apply to any information which (i) is disclosed or used during the Term by the
Executive as required or appropriate in connection with his duties as an officer
of the Company or a subsidiary or affiliate thereof, (ii) is disclosed as
required by a court of law, by any governmental agency having supervisory
authority over the business of the Company or any of its subsidiaries or
affiliates or by any administrative or legislative body, including a committee
thereof) with apparent jurisdiction to order the Executive to divulge, disclose
or make accessible such information, (iii) is disclosed to the Executive’s
spouse, attorney and/or his personal tax and financial advisors as reasonably
necessary or appropriate to advance the Executive’s tax, financial and other
personal planning (iv) is known publicly; (v) is in the public domain or
hereafter enters the public domain without the fault of the Executive; (vi) is
known to the Executive prior to his receipt of such information from the Company
or any of its subsidiaries or affiliates, as evidenced by written records of the
Executive or (vii) is hereafter disclosed to the Executive by a third party not
under an obligation of confidence to the Company or any of its subsidiaries or
affiliates.

(c) Executive Obligations. The Executive agrees that he shall, immediately after
he gains knowledge of any required disclosure of Confidential Information
pursuant to clause (ii) of subsection (b) above, give the Company written notice
promptly upon obtaining knowledge of the required disclosure of Confidential
Information and, in any event, prior to such required disclosure of Confidential
Information, and use commercially reasonable efforts to cooperate with the
Company (at the Company’s sole expense) in obtaining an adequate protective
order for such Confidential Information. The Executive further agrees to
properly advise any recipient of Confidential Information pursuant to clause
(iii) of subsection (b) above of the obligations of the Executive hereunder, to
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Section 5.3 as if a signatory to this Agreement and to be responsible for any
breach by any such recipient of the terms of this Section 5.3. The Executive
further agrees not to remove from the premises of the Company, or as applicable,
the premises of any of its subsidiaries or affiliates, except as an employee of
the Company in pursuit of the business of the Company, its subsidiaries or
affiliates, or except as specifically permitted in writing by the Board, any
document or other object containing or reflecting any Confidential Information.
On or before the Termination Date, the Executive shall forthwith deliver to the
Company all such Confidential Information, including without limitation all
lists of customers, correspondence, accounts, records and any other documents or
property made or held by the Executive or under the Executive’s control in
relation to the business or affairs of the Company or its subsidiaries or
affiliates, and no copy of any such Confidential Information shall be retained
by the Executive.

5.4 Inventions. The Executive hereby assigns to the Company the Executive’s
entire right, title and interest in and to all discoveries and improvements,
patentable or otherwise, trade secrets and ideas, writings and copyrightable
material, which may be conceived by the Executive or developed or acquired by
the Executive during the Term, which may pertain directly or indirectly to the
business of the Company or any of its subsidiaries or affiliates. The Executive
agrees to disclose fully all such developments to the Company upon its request,
which disclosure shall be made in writing promptly following any such request.
The Executive shall, upon the Company’s request, execute, acknowledge and
deliver to the Company all instruments and do all other acts which are necessary
or desirable to enable the Company or any of its subsidiaries to file and
prosecute applications for, and to acquire, maintain and enforce, all patents,
trademarks and copyrights in all countries.

5.5 Non-Disparagement. Each party hereto acknowledges and agrees that such party
will not defame or publicly criticize the services, business, integrity,
veracity or personal or professional reputation of the other party and, in the
case of the Company, its officers, directors, partners, employees, affiliates or
agents thereof, in either a professional or personal manner, except that the
foregoing shall not limit normal competitive activities; provided that, in the
case of the Executive, such competitive activities are in compliance with the
Executive’s obligations under Section 5.2.

5.6 Remedies. The Executive acknowledges that the Company’s remedy at law for a
breach by him of the provisions of this Article V will be inadequate.
Accordingly, in the event of a breach or threatened breach by the Executive of
any provision of this Article V, the Company shall be entitled to injunctive
relief (without posting a bond or other security) in addition to any other
remedy it may have. If any of the provisions of, or covenants continued in, this
Article V are hereafter construed to be invalid or unenforceable in any
jurisdiction, the same shall not affect the remainder of the provisions or the
enforceability thereof in any jurisdiction, which shall be given full effect,
without regard to the invalidity or unenforceability in such other jurisdiction.
If, at any time of enforcement of this Article V, a court or an arbitrator holds
that the restrictions stated herein are unreasonable and/or unenforceable under
circumstances then existing, the parties hereto agree that the maximum period,
scope or geographical area reasonable and/or enforceable under such
circumstances shall be substituted for the stated period, scope or area and that
the court or arbitrator shall be allowed to revise the restrictions contained
herein to cover the maximum period, scope and area permitted by law provided,
however, that the determination of such court or arbitrator shall not affect the
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any other jurisdiction.. This Agreement shall not authorize a court or
arbitrator to increase or broaden any of the restrictions in this Article V.

5.7 Blue Pencil. If, at any time, the provisions of this Article V shall be
determined to be invalid or unenforceable under any applicable law, by reason of
being vague or unreasonable as to area, duration or scope of activity, this
Article V shall be considered divisible and shall become and be immediately
amended to only such area, duration and scope of activity as shall be determined
to be reasonable and enforceable by the court or other body having jurisdiction
over the matter. The Executive and the Company agree that this Article V as
amended pursuant to the immediately preceding sentence, shall be valid and
binding as though any invalid or unenforceable provision had not been included
therein.

ARTICLE VI.

Termination

6.1 Company Termination of Employment

(a) Termination for Cause. The Company shall have the right to terminate the
Executive’s employment at any time for Cause by delivery of a Notice of
Termination.

(b) Death. In the event the Executive dies during the Term, the Executive’s
employment with the Company shall automatically terminate, such termination to
be effective on the date of the Executive’s death.

(c) Disability. In the event that the Executive suffers a Disability, the
Company shall have the right to terminate the Executive’s employment by delivery
of a Notice of Termination.

(d) Termination without Cause. The Company may at any time terminate the
Executive’s employment by delivery of a Notice of Termination for any reason
other than Cause or the Executive’s death or Disability. In the event the
Company elects not to renew this Agreement pursuant to Section 3.1 hereof on a
Renewal Date falling within a Change in Control Period, the Executive’s
employment shall be deemed terminated on such Renewal Date and the notice of
non-renewal of this Agreement delivered by the Company to the Executive pursuant
to Section 3.1 shall constitute delivery of a Notice of Termination without
Cause.

6.2 Executive Termination of Employment.

(a) Termination without Good Reason. The Executive may terminate his employment
at any time without Good Reason by delivery of a Notice of Termination to the
Company.

(b) Termination with Good Reason. The Executive may terminate his employment for
Good Reason only (i) within the Change in Control Period and (ii) by delivery of
Notice of Termination to the Company within 30 calendar days of the

 

 

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Executive first becoming aware of the circumstances giving rise to the
Executive’s right to terminate his employment for Good Reason.

6.3 Notice of Termination. Any purported termination of the Executive’s
employment (other than termination pursuant to Section 6.1(b) or the second
sentence of Section 6.1(d) hereof) shall be communicated by written Notice of
Termination to the other party hereto delivered in accordance with Section 7.3
hereof.

6.4 Effect of Termination.

(a) Termination by Company for Cause or by Executive without Good Reason. In the
event of any termination of the Executive’s employment during the Term (x) by
the Company for Cause or (y) by the Executive without Good Reason, the Company
shall pay to or provide the Executive with the following compensation and
benefits:

(i) Any earned but unpaid Base Salary up to and including the Date of
Termination, payable in accordance with the Company’s customary payroll
procedures;

(ii) Any unreimbursed business expenses incurred by the Executive in the
performance of his duties for the Company prior to the Date of Termination, upon
receipt by the Company of documentation in such form as customarily required by
the Company to report business expenses, payable in accordance with the
Company’s customary business expense reimbursement procedures;

(iii) The Executive’s Base Salary for any vacation days accrued and unused
(determined in accordance with Company policy) by the Executive from the
immediately preceding January 1st until the Date of Termination, payable in
accordance with the Company’s customary payroll procedures;

(iv) Any housing expense reimbursement payable in accordance with Section 4.1(d)
until the earlier of (A) the end of the lease for the Executive’s residence in
Bermuda or (B) the three month anniversary of the Date of Termination, payable
in accordance with the Company’s customary business housing allowance
reimbursement procedures; and

(v) Any other benefits available to employees of the Company generally, through
and including the Date of Termination, payable or deliverable in accordance with
the terms and conditions applicable to such benefits.

(b) Termination as a Result of Death or Disability. In the event of any
termination of the Executive’s employment during the Term as a result of the
Executive’s death or Disability, the Company shall pay to or provide the
Executive (or the Executive’s heirs) with the following compensation and
benefits:

(i) Any earned but unpaid Base Salary up to and including the Date of
Termination, payable in accordance with the Company’s customary payroll
procedures;

 

 

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(ii) Any earned but unpaid Annual Incentive Compensation for the last completed
calendar year during the Term, which Annual Incentive Compensation shall be
determined (A) in accordance with the Company’s annual incentive plan, (B)
utilizing the Threshold Annual Incentive Compensation Percentage, Maximum Annual
Incentive Compensation Percentage, Target Annual Incentive Compensation
Percentage and performance criteria previously established by the Board and the
Executive’s Direct Supervisor for such completed calendar year in accordance
with Section 4.1(b) and (C) by the Board and the Executive’s Direct Supervisor
(1) without the exercise by the Board or the Executive’s Direct Supervisor of
any discretionary adjustment to such Annual Incentive Compensation and (2) with
the Board and the Executive’s Direct Supervisor ascribing to any individual
evaluation of the Executive the same result as occurs based upon the Company’s
performance under its annual incentive plan, and which Annual Incentive
Compensation shall be payable within 15 business days of the Date of
Termination;

(iii) A cash sum equal to the Target Annual Incentive Compensation Percentage of
the Executive’s Base Salary as of the Date of Termination multiplied by a
fraction (x) the numerator of which is the number of calendar days elapsed in
the calendar year up to and including the Date of Termination and (y) the
denominator of which is 365, payable within 15 business days of the Date of
Termination;

(iv) Any unreimbursed business expenses incurred by the Executive in the
performance of his duties for the Company prior to the Date of Termination, upon
receipt by the Company of documentation in such form as customarily required by
the Company to report business expenses, payable in accordance with the
Company’s customary business expense reimbursement procedures;

(v) The Executive’s Base Salary for any vacation days accrued and unused
(determined in accordance with Company policy) by the Executive from the
immediately preceding January 1st until the Date of Termination, payable in
accordance with the Company’s customary payroll procedures;

(vi) Any housing expense reimbursement payable in accordance with Section 4.1(d)
until the earlier of (A) the end of the lease for the Executive’s residence in
Bermuda or (B) the three month anniversary of the Date of Termination, payable
in accordance with the Company’s customary business housing allowance
reimbursement procedures;

(vii) Reimbursement for the reasonable cost of the preparation of the
Executive’s home country federal and state income tax returns by KPMG, or an
alternate tax preparation service provider elected by the Executive and approved
by the Company, for the calendar year during which the Date of Termination
occurred; provided that the maximum amount of tax preparation expense
reimbursable by the Company pursuant hereto shall be $2,500 and the Company
shall have received from the Executive satisfactory written substantiation for

 

 

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such tax expenses, which reimbursement shall be payable on within 15 business
days after the submission to the Company of satisfactory written substantiation
for such tax expenses;

(viii) Any proper and reasonable expense reimbursement relating to the
relocation of the Executive’s residence from Bermuda, in the event the Executive
and the Executive’s family relocate their permanent residence from Bermuda
during the 12 months immediately following the Date of Termination, which
relocation expense reimbursement shall be made in a manner agreeable to the
Company and the Executive and subject to receipt by the Company of satisfactory
written substantiation for such relocation expenses, which reimbursement shall
be payable within 15 business days after the submission to the Company of
satisfactory written substantiation for such relocation expenses; and

(ix) Any other benefits available to employees of the Company generally, through
and including the Date of Termination, payable or deliverable in accordance with
the terms and conditions applicable to such benefits.

(c) Termination by the Company without Cause. In the event of any termination of
the Executive’s employment during the Term by the Company without Cause, other
than during a Change in Control Period, the Company shall pay to or provide the
Executive with the following compensation and benefits:

(i) Any earned but unpaid Base Salary up to and including the Date of
Termination, payable in accordance with the Company’s customary payroll
procedures;

(ii) Any earned but unpaid Annual Incentive Compensation for the last completed
calendar year during the Term, which Annual Incentive Compensation shall be
determined (A) in accordance with the Company’s annual incentive plan, (B)
utilizing the Threshold Annual Incentive Compensation Percentage, Maximum Annual
Incentive Compensation Percentage, Target Annual Incentive Compensation
Percentage and performance criteria previously established by the Board and the
Executive’s Direct Supervisor for such completed calendar year in accordance
with Section 4.1(b) and (C) by the Board and the Executive’s Direct Supervisor
(1) without the exercise by the Board or the Executive’s Direct Supervisor of
any discretionary adjustment to such Annual Incentive Compensation and (2) with
the Board and the Executive’s Direct Supervisor ascribing to any individual
evaluation of the Executive the same result as occurs based upon the Company’s
performance under its annual incentive plan, and which Annual Incentive
Compensation shall be payable within 15 business days of the Date of
Termination;

(iii) A cash sum equal to the Target Annual Incentive Compensation Percentage of
the Executive’s Base Salary as of the Date of Termination multiplied by a
fraction (x) the numerator of which is the number of calendar days elapsed from
the January 1st immediately preceding the Date of Termination

 

 

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to the Date of Termination and (y) the denominator of which is 365, payable
within 15 business days of the Date of Termination;

(iv) The continuation of the Executive’s Base Salary, paid in accordance with
the Company’s payroll policy, from the Date of Termination to the earlier of (x)
the twelve month anniversary of the Date of Termination or (y) February 28th of
the calendar year following the Date of Termination;

(v) A cash sum equal to the difference (if any) between 12 months of the
Executive’s Base Salary and the amounts previously paid to the executive
pursuant to clause (iv), payable on the February 28th of the calendar year
following the Date of Termination;

(vi) The continuation during the 12 months immediately following the date of
Termination of the eligibility of the Executive, his spouse and his dependent
children to participate in the Company’s medical, dental, vision and life
insurance plans in which the Executive, his spouse and his dependent children
participated immediately preceding the Date of Termination; provided, however,
that participation in such medical, dental, vision and life insurance plans
shall be subject to the Executive’s payment of the applicable employee portion
of the monthly premium cost, if any.

(vii) Any unreimbursed business expenses incurred by the Executive in the
performance of his duties for the Company prior to the Date of Termination, upon
receipt by the Company of documentation in such form as customarily required by
the Company to report business expenses, payable in accordance with the
Company’s customary business expense reimbursement procedures;

(viii) The Executive’s Base Salary for any vacation days accrued and unused
(determined in accordance with Company policy) by the Executive from the
immediately preceding January 1st until the Date of Termination, payable in
accordance with the Company’s customary payroll procedures;

(ix) Any housing expense reimbursement payable in accordance with Section 4.1(d)
until the earlier of (A) the end of the lease for the Executive’s residence in
Bermuda or (B) the three month anniversary of the Date of Termination, payable
in accordance with the Company’s customary business housing allowance
reimbursement procedures;

(x) Reimbursement for the reasonable cost of the preparation of the Executive’s
home country federal and state income tax returns by KPMG, or an alternate tax
preparation service provider elected by the Executive and approved by the
Company, for the calendar year during which the Date of Termination occurred;
provided that the maximum amount of tax preparation expense reimbursable by the
Company pursuant hereto shall be $2,500 and the Company shall have received from
the Executive satisfactory written substantiation for such tax expenses, which
reimbursement shall be payable within 15 business

 

 

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days after the submission to the Company of satisfactory written substantiation
for such tax expenses;

(xi) Any proper and reasonable expense reimbursement relating to the relocation
of the Executive’s residence from Bermuda, in the event the Executive and the
Executive’s family relocate their permanent residence from Bermuda during the 12
months immediately following the Date of Termination, which relocation expense
reimbursement shall be made in a manner agreeable to the Company and the
Executive and subject to receipt by the Company of satisfactory written
substantiation for such relocation expenses, which reimbursement shall be
payable within 15 business days after the submission to the Company of
satisfactory written substantiation for such relocation expenses; and

(xii) Any other benefits available to employees of the Company generally,
through and including the Date of Termination, payable or deliverable in
accordance with the terms and conditions applicable to such benefits.

(d) Termination by the Company without Cause or by the Executive with Good
Reason During a Change in Control Period. In the event of any termination of the
Executive’s employment during the Term (x) by the Company without Cause or (y)
by the Executive with Good Reason, in each case during a Change in Control
Period, the Company shall pay to or provide the Executive with the following
compensation and benefits:

(i) Any earned but unpaid Base Salary up to and including the Date of
Termination, payable in accordance with the Company’s customary payroll
procedures;

(ii) Any earned but unpaid Annual Incentive Compensation for the last completed
calendar year during the Term, which Annual Incentive Compensation shall be
determined (A) in accordance with the Company’s annual incentive plan, (B)
utilizing the Threshold Annual Incentive Compensation Percentage, Maximum Annual
Incentive Compensation Percentage, Target Annual Incentive Compensation
Percentage and performance criteria previously established by the Board and the
Executive’s Direct Supervisor for such completed calendar year in accordance
with Section 4.1(b) and (C) by the Board and the Executive’s Direct Supervisor
(1) without the exercise by the Board or the Executive’s Direct Supervisor of
any discretionary adjustment to such Annual Incentive Compensation and (2) with
the Board and the Executive’s Direct Supervisor ascribing to any individual
evaluation of the Executive the same result as occurs based upon the Company’s
performance under its annual incentive plan, and which Annual Incentive
Compensation shall be payable within 15 business days of the Date of
Termination;

(iii) A cash sum equal to the Target Annual Incentive Compensation Percentage of
the Executive’s Base Salary as of the Date of Termination multiplied by a
fraction (x) the numerator of which is the number of calendar

 

 

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days elapsed from the January 1st immediately preceding the Date of Termination
to the Date of Termination and (y) the denominator of which is 365, payable
within 15 business days of the Date of Termination;

(iv) The continuation of the Executive’s Base Salary, paid in accordance with
the Company’s payroll policy, from the Date of Termination to the earlier of (x)
the twelve month anniversary of the Date of Termination or (y) February 28th of
the calendar year following the Date of Termination;

(v) A cash sum equal to the difference (if any) between 12 months of the
Executive’s Base Salary and the amounts previously paid to the executive
pursuant to clause (iv), payable on the February 28th of the calendar year
following the Date of Termination;

(vi) A cash sum equal to the average of the three most recent Annual Incentive
Compensation cash payments (including any Annual Incentive Compensation awards
of zero) made by the Company to the Executive, payable within 15 business days
of the six month anniversary of the Date of Termination;

(vii) The continuation during the 12 months immediately following the date of
Termination of the eligibility of the Executive, his spouse and his dependent
children to participate in the Company’s medical, dental, vision and life
insurance plans in which the Executive, his spouse and his dependent children
participated immediately preceding the Date of Termination; provided, however,
that participation in such medical, dental, vision and life insurance plans
shall be subject to the Executive’s payment of the applicable employee portion
of the monthly premium cost, if any.

(viii) Any unreimbursed business expenses incurred by the Executive in the
performance of his duties for the Company prior to the Date of Termination, upon
receipt by the Company of documentation in such form as customarily required by
the Company to report business expenses, payable in accordance with the
Company’s customary business expense reimbursement procedures;

(ix) The Executive’s Base Salary for any vacation days accrued and unused
(determined in accordance with Company policy) by the Executive from the
immediately preceding January 1st until the Date of Termination, payable in
accordance with the Company’s customary payroll procedures;

(x) Any housing expense reimbursement payable in accordance with Section 4.1(d)
until the earlier of (A) the end of the lease for the Executive’s residence in
Bermuda or (B) the three month anniversary of the Date of Termination, payable
in accordance with the Company’s customary business housing allowance
reimbursement procedures;

(xi) Reimbursement for the reasonable cost of the preparation of the Executive’s
home country federal and state income tax returns by KPMG, or an alternate tax
preparation service provider elected by the Executive and approved

 

 

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by the Company, for the calendar year during which the Date of Termination
occurred; provided that the maximum amount of tax preparation expense
reimbursable by the Company pursuant hereto shall be $2,500 and the Company
shall have received from the Executive satisfactory written substantiation for
such tax expenses, which reimbursement shall be payable within 15 business days
after the submission to the Company of satisfactory written substantiation for
such tax expenses;

(xii) Any proper and reasonable expense reimbursement relating to the relocation
of the Executive’s residence from Bermuda, in the event the Executive and the
Executive’s family relocate their permanent residence from Bermuda during the 12
months immediately following the Date of Termination, which relocation expense
reimbursement shall be made in a manner agreeable to the Company and the
Executive and subject to receipt by the Company of satisfactory written
substantiation for such relocation expenses, which reimbursement shall be
payable within 15 business days after the submission to the Company of
satisfactory written substantiation for such relocation expenses; and

(xiii) Any other benefits available to employees of the Company generally,
through and including the Date of Termination, payable or deliverable in
accordance with the terms and conditions applicable to such benefits.

6.5 Executive Release. The execution by the Executive of the Executive Release
attached hereto as Exhibit C shall be a condition precedent to the delivery to
the Executive by the Company of any payment or benefit under Section 6.4(c) or
Section 6.4(d). In addition, the Executive Agrees that, to the extent
applicable, a portion of the payments made by the Company to the Executive under
Section 6.4(c) or Section 6.4(d) shall be deemed severance pay in lieu of notice
under the Bermuda Employment Act 2000 and that the Company shall have no other
liability to the Executive thereunder.

6.6 Resignations. The resignation by the Executive from all director and officer
positions held by the Executive with the Company and any subsidiary or affiliate
of the Company shall be a condition precedent to the delivery to the Executive
by the Company of any payment or benefit under Section 6.4 (other than in
connection with a termination of the Executive’s employment wit the Company as a
result of the Executive’s death).

6.7 Compliance with Restrictive Covenants. The Executive’s continued compliance
with the restrictive covenants set forth in Sections 5.2, 5.3, 5.4 and 5.5 shall
be a condition precedent to the receipt by the Executive of the payments and
benefits set forth in Sections 6.4(b)(iii), 6.4(b)(vii), 6.4(b)(viii),
6.4(c)(iii), 6.4(c)(iv), 6.4(c)(v), 6.4(c)(vi), 6.4(c)(x), 6.4(c)(xi),
6.4(d)(iii), 6.4(d)(iv), 6.4(d)(v), 6.4(d)(vi), 6.4(d)(vii), 6.4(d)(xi) and
6.4(d)(xii) on or after the Date of Termination and, in the event the Executive
breaches one or more of the covenants set forth in Sections 5.2, 5.3, 5.4 or
5.5, the Company shall be entitled to recover from the Executive the value of
any payment or benefit made or provided by the Company to the Executive pursuant
to the above-referenced Sections of this Agreement on and after the first date
of such breach.

 

 

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6.8 Section 280G Treatment.

(a) In the event that any payment or benefit received or to be received by the
Executive (including any payment or benefit received in connection with a Change
in Control or the termination of the Executive’s employment, whether pursuant to
the terms of this Agreement or any other plan, arrangement or agreement) (all
such payments and benefits being hereinafter referred to as the “Total
Payments”) would be subject (in whole or part), to any excise tax imposed under
Section 4999 of the Code (the “Excise Tax”), then, after taking into account any
reduction in the Total Payments provided by reason of section 280G of the Code
in such other plan, arrangement or agreement, the cash payments under Section
6.4 shall first be reduced, and the non-cash payments under Section 6.4 shall
thereafter be reduced, to the extent necessary so that no portion of the Total
Payments is subject to the Excise Tax.

(b) For purposes of determining whether and the extent to which the Total
Payments will be subject to the Excise Tax, (i) no portion of the Total Payments
the receipt or enjoyment of which the Executive shall have waived at such time
and in such manner as not to constitute a “payment” within the meaning of
section 280G(b) of the Code shall be taken into account, (ii) no portion of the
Total Payments shall be taken into account which, in the opinion of tax counsel
(“Tax Counsel”) reasonably acceptable to the Executive and selected by the
accounting firm (the “Auditor”) which was, immediately prior to the Change in
Control, the Company’s independent auditor, does not constitute a “parachute
payment” within the meaning of section 280G(b)(2) of the Code (including by
reason of section 280G(b)(4)(A) of the Code) and, in calculating the Excise Tax,
no portion of such Total Payments shall be taken into account which, in the
opinion of Tax Counsel, constitutes reasonable compensation for services
actually rendered, within the meaning of section 280G(b)(4)(B) of the Code, in
excess of the Base Amount allocable to such reasonable compensation, and (iii)
the value of any non-cash benefit or any deferred payment or benefit included in
the Total Payments shall be determined by the Auditor in accordance with the
principles of sections 280G(d)(3) and (4) of the Code

6.9 Equity Incentive Awards. The Executive’s rights with respect to his Equity
Incentive Awards upon any termination of his employment with the Company shall
be governed exclusively by the terms and conditions of the Plans and any award
agreements executed by the Executive in connection with such Equity Incentive
Awards.

6.10 Other Compensation and Benefits. Except as specified in Section 6.4, the
Executive shall not be entitled to any compensation, benefits or other payments
or distributions, and references in the Executive Release to the release of
claims against the Company shall be deemed to also include reference to the
release of claims against all compensation and benefit plans and arrangements
established or maintained by the Company and its subsidiaries and affiliates.

6.11 Obligations of the Executive. The Executive shall have no obligations to
the Company under this Agreement after the Date of Termination, other than as
provided in Section 6.12, and except and to the extent Sections 5.2, 5.3, 5.4 or
5.5 shall apply.

 

 

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6.12 Post-Termination Cooperation. Following any termination of the Executive’s
employment for any reason, the Executive shall reasonably cooperate with the
Company to assist with existing or future investigations, proceedings,
litigations or examinations involving the Company or any of its subsidiaries or
affiliates. For each business day, or part thereof, that the Executive provides
assistance as contemplated under this Section 6.12, the Company shall pay the
Executive an amount equal to (i) the Executive’s annual Base Salary as in effect
on the date of the Executive’s termination of employment, divided by (ii) 200.
In addition, upon presentment of satisfactory written documentation, the Company
will reimburse the Executive for reasonable out-of-pocket travel, lodging and
other incidental expenses he incurs in providing such assistance. If requested
by the Company, the Executive shall make reasonable good faith efforts to travel
to such locations as the Company may reasonably request.

ARTICLE VII.

Miscellaneous

7.1 Life Insurance. The Executive agrees that the Company or any of its
subsidiaries or affiliates may apply for and secure and own insurance on the
Executive’s life (in amounts determined by the Company) for the benefit of the
Company. The Executive agrees to cooperate fully in the application for and
securing of such insurance, including the submission by the Executive to such
physical and other examinations, and the answering of such questions and
furnishing of such information by the Executive, as may be required by the
carrier(s) of such insurance. Notwithstanding anything to the contrary contained
herein, neither the Company nor any of its subsidiaries or affiliates shall be
required to obtain any insurance for or on behalf of the Executive.

7.2 Benefit of Agreement; Assignment; Beneficiary. This Agreement shall inure to
the benefit of and be binding upon the Company and its successors and assigns,
including, without limitation, any corporation or person which may acquire all
or substantially all of the Company’s assets or business, or with or into which
the Company may be consolidated or merged. This Agreement shall also inure to
the benefit of, and be enforceable by, the Executive and his personal or legal
representatives, executors, administrators, successors, heirs, distributes,
devisees and legatees. The Company shall require any successor (whether direct
or indirect, by operation of law, purchase, merger, consolidation or otherwise)
to all or substantially all of the business and/or assets of the Company to
expressly assume and agree to perform this Agreement in the same manner and to
the same extent that the Company would be required to perform it if no such
succession had taken place.

7.3 Notices. All notices and other communications required or permitted
hereunder shall be in writing and shall be deemed given when (a) delivered
personally or by overnight courier to the following address of the other party
hereto (or such other address for such party as shall be specified by notice
given pursuant to this Section 7.3) or (b) sent by facsimile to the following
facsimile number of the other party hereto (or such other facsimile number for
such party as shall be specified by notice given pursuant to this Section 7.3),
with the confirmatory copy delivered by overnight courier to the address of such
party pursuant to this Section 7.3:

 

 

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If to the Company, to:

Endurance Specialty Holdings Ltd.

Wellesley House

90 Pitts Bay Road

Pembroke HM 08, Bermuda

Attention: General Counsel

Facsimile: (441) 278-0401

If to the Executive, to the residence address or residence facsimile number of
the Executive set forth in the records of the Company.

7.4 Entire Agreement: This Agreement contains the entire agreement of the
parties hereto with respect to the terms and conditions of the Executive’s
employment and supersedes any and all prior agreements and understandings,
whether written or oral, between the parties hereto with respect to compensation
due for services rendered hereunder.

7.5 Amendment and Waiver. This Agreement may not be changed or modified except
by an instrument in writing signed by both of the parties hereto. The waiver by
either party of a breach of any provision of this Agreement shall not operate or
be construed as a continuing waiver or as a consent to or waiver of any
subsequent breach hereof.

7.6 Headings. The Article and Section headings herein are for convenience of
reference only, do not constitute a part of this Agreement and shall not be
deemed to limit or affect any of the provisions hereof.

7.7 Arbitration. Except as otherwise set forth in Section 5.6 hereof, any
dispute or controversy between the Company and the Executive, whether arising
out of or relating to this Agreement, the breach of this Agreement, or
otherwise, shall be settled by arbitration in Hamilton, Bermuda administered in
accordance with the Arbitration Act 1986, and judgment on the award rendered by
the arbitrator may be entered in any court having jurisdiction thereof. The
arbitrator shall have the authority to award any remedy or relief that a court
of competent jurisdiction could order or grant, including, without limitation,
the issuance of an injunction. However, either party may, without inconsistency
with this arbitration provision, apply to any court having jurisdiction over
such dispute or controversy and seek interim provisional, injunctive or other
equitable relief until the arbitration award is rendered or the controversy is
otherwise resolved. Except as necessary in court proceedings to enforce this
arbitration provision or an award rendered hereunder, or to obtain interim
relief, neither a party nor an arbitrator may disclose the existence, content or
results of any arbitration hereunder without the prior written consent of the
Company and the Executive. The Executive shall have no right to enforce any of
his rights hereunder by seeking or obtaining injunctive or other equitable
relief and acknowledges that damages are an adequate remedy for any breach by
the Company of this Agreement.

7.8 Governing Law. This Agreement shall be governed by, and construed and
interpreted in accordance with, the internal laws of Bermuda, without regard to
principles of conflict of laws.

 

 

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7.9 No Mitigation; No Offset. The Executive shall not be required to mitigate
damages or the amount of any payment provided for under this Agreement by
seeking (and, without limiting the generality of this sentence, no payment
otherwise required under this Agreement shall be reduced on account of) other
employment or otherwise, and payments under this Agreement shall not be subject
to offset in respect of any claims which the Company may have against the
Executive.

7.10 Attorneys’ Fees. Each party to this Agreement will bear its own expenses in
connection with any dispute or legal proceeding between the parties arising out
of the subject matter of this Agreement, including any proceeding to enforce any
right or provision under this Agreement.

7.11 Compliance with Section 409A. This Agreement is intended to comply with
Section 409A of the Code and shall be construed and interpreted in accordance
with such intent. If as of the Date of Termination the Executive is a “specified
employee,” as defined in Section 409A of Code, to the extent required by Section
409A of the Code, the benefits specified in Section 6.4 shall not commence until
the later of (a) the commencement date otherwise set forth in Section 6.4 or (b)
a date which is six months after the Date of Termination. Furthermore, if the
Executive is affected by the six (6) month delay in payment imposed by Section
409A of the Code and this Section 7.11, the aggregate amount of the first six
months of any installment payments under Section 6.4 shall be paid at the
beginning of the seventh month following the Date of Termination and monthly
installment payments shall continue thereafter as specified in Section 6.4. To
the extent that the delivery of any cash or benefits to the Executive under this
Agreement, or the payment, settlement or deferral thereof, is otherwise subject
to Section 409A of the Code, such cash or benefits shall be paid, settled or
deferred in a manner that will comply with Section 409A of the Code, including
regulations or other guidance issued with respect thereto, except as otherwise
agreed in writing by the Company and the Executive.

7.12 Termination; Survivorship. This Agreement shall terminate upon termination
of the Executive’s employment, except that the respective rights and obligations
of the parties under this Agreement as set forth herein shall survive any
termination of this Agreement to the extent necessary to the intended
preservation of such rights and obligations.

7.13 Severability. Other than Article V, to which Section 5.7 shall apply,
whenever possible, each provision of this Agreement shall be interpreted in such
manner as to be effective and valid under applicable law, but if any provision
of this Agreement is held to be invalid, illegal or unenforceable in any respect
under applicable law or rule in any jurisdiction, such invalidity, illegality or
unenforceability shall not affect the validity, legality or enforceability of
any other provision of this Agreement or the validity, legality or
enforceability of such provision in any other jurisdiction, but this Agreement
shall be reformed, construed and enforced in such jurisdiction as if such
invalid, illegal or unenforceable provision had never been contained herein.

7.14 Other Agreements. The Executive represents and warrants to the Company that
to the best of his knowledge, neither the execution and delivery of this
Agreement nor the performance of his duties hereunder violates or will violate
the provisions of any other agreement to which he is a party or by which he is
bound.

 

 

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7.15 Subsidiaries, etc.

(a) Company Obligations. The obligations of the Company under this Agreement may
be satisfied by any subsidiary or affiliate of the Company for which the
Executive serves as an employee under this Agreement, to the extent such
obligations relate to the Executive’s employment by such subsidiary or
affiliate.

(b) Company Rights The rights of the Company under this Agreement may be
enforced by any Subsidiary or affiliate of the Company for which the Executive
serves as an employee under this Agreement, to the extent such rights relate to
the Executive’s employment by such subsidiary or affiliate.

7.16 Counterparts. This Agreement may be executed in one or more counterparts,
each of which shall be deemed to be an original but all of which together will
constitute one and the same instrument.

IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date first written above.

 

 

 

ENDURANCE SPECIALTY HOLDINGS LTD.

 

By: 

 

 

Name:

 

 

 

Title:

 

 

 

 

 

 

[Name of Executive]

 

 

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