EXHIBIT 10.4

 

Montpelier Re Holdings Ltd.
2010 Annual Bonus Plan

 

Purpose

 

The purpose of this Plan is to increase the intrinsic business value of
Montpelier Re Holdings Ltd. and its operating subsidiaries (the “Company”) by
aligning employee performance with the interests of the Company’s owners. All
full-time employees of the Company shall be eligible to participate in the Plan.

 

Performance Targets

 

The Plan shall be tied to a calendar year performance cycle consistent with the
Company’s fiscal year. Annual bonus pool targets for categories of employees and
an overall Company performance target under the Plan shall be set by the
Company’s Compensation and Nominating Committee (the “Committee”). At the
conclusion of the calendar year, the Committee shall judge Company performance
against the bonus pool targets when determining the final size of the bonus
pools and the level of payout for each employee. At lower levels of the Company
employee individual performance is also considered. The Company’s Chief
Executive Officer, in consultation with the Committee, shall then recommend the
distribution of the pool to individual Plan participants who are non-executive
officers of the Company. The Committee shall approve any payments to the
Company’s executive officers.

 

Bonus Pool Targets

 

For the 2010 calendar year, the annual bonus pool targets for the Company’s
officers and all remaining Company staff shall be the following percentages of
eligible salaries:

 

Performance

 

Group A

 

Group B

 

Group C-G

 

Minimum

 

0%

 

0%

 

0%

 

On Target

 

100%

 

75%

 

10-50%

 

Superior

 

200%

 

150%

 

20-100%

 

 

Eligible salaries for all officers and staff shall be equivalent to the 2010
base salaries of Plan participants (as in effect on April 1, 2010), pro-rated in
the case of any officer or staff member employed by the Company for less than
the entire 2010 calendar year.

 

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