EX-10.4:



 





Exhibit 10.4




PLATINUM UNDERWRITERS HOLDINGS, LTD.




AMENDED AND RESTATED EXECUTIVE INCENTIVE PLAN




Section 1. Purpose




     The purpose of this Platinum Underwriters Holdings, Ltd. Amended and Restated Executive
Incentive Plan is to attract, retain and motivate executive officers and other select senior
officers of the Company by providing them with an opportunity to earn long-term incentive
compensation based on the performance of the Company. The Plan is designed to promote the
interests of the Company and its shareholders by motivating superior performance by key personnel
to achieve the Company’s objectives.



Section 2. Definitions




     The following capitalized terms as used herein shall have the following meanings:



     (a) “Annual ROE” means the sum of the Quarterly ROE for each fiscal quarter in a Plan
Year.



     (b) “Average Annual ROE” means the sum of the Annual ROE for each completed Plan Year
in a Performance Cycle divided by the number of completed Plan Years in the Performance Cycle,
provided that two or more completed fiscal quarters may, in the discretion of the
Committee, constitute a completed Plan Year.



     (c) “Award” means a Share Unit Award granted to a Participant under the Plan.



     (d) “Base Salary” means, in the sole discretion of the Committee, (i) a Participant’s
annual base salary as in effect at the time determined by the Committee for purposes of an Award
hereunder, or (ii) the annual average of the base salary paid to a Participant during a Performance
Cycle, in each case, disregarding any deferrals, offsets or withholdings therefrom.



     (e) “Board” means the Board of Directors of Platinum Underwriters Holdings, Ltd., a
Bermuda company.



     (f) “Change in Control” shall have the meaning set forth in the Share Incentive Plan,
as in effect on the relevant date of determination.



     (g) “Committee” means the Compensation Committee of the Board, or such other committee
of the Board that the Board shall designate from time to time to administer the Plan.



     (h) “Common Shares” means the common shares of Platinum Underwriters Holdings, Ltd., a
Bermuda company, par value $0.01 per share.



     (i) “Company” means Platinum Underwriters Holdings, Ltd., a Bermuda company, and
its subsidiaries.



 









 





     (j) “Participant” means an employee of the Company who has been granted an Award under
the Plan.



     (k) “Performance Cycle” means any period consisting of three consecutive Plan Years in
which performance under the Plan shall be measured, or such other period as the Committee shall
determine in its sole discretion.



     (l) “Performance Percentage” means the percentage applicable to the degree of
achievement with respect to Average Annual ROE for a Performance Cycle by which the number of Share
Units subject to a Participant’s Award for such Performance Cycle shall be multiplied to determine
the payout to such Participant in respect of such Award, as determined by the Committee and set
forth in a schedule for a given Performance Cycle. The Performance Percentage for a degree of
achievement which falls between particular levels of Average Annual ROE set forth in such schedule
for a given Performance Cycle shall be determined by straight line interpolation.



     (m) “Plan”
means this Platinum Underwriters Holdings, Ltd. Amended and Restated Executive Incentive Plan,
as it may be amended and restated from time to time.



     (n) “Plan Year” means each calendar year in which the Plan shall be in effect.



     (o) “Quarterly ROE” means: (i) net income (loss) available to common shareholders as
shown on the Company’s consolidated financial statements for a fiscal quarter prepared in
accordance with accounting principles generally accepted in the United States less dividends
declared and payable to holders of the Company’s preferred shares issued and outstanding as of the
end of the fiscal quarter, divided by (ii) total shareholders’ equity as shown on such consolidated
financial statements less the aggregate par value and additional paid in capital attributable to
the Company’s preferred shares issued and outstanding as of the end of the fiscal quarter,
disregarding any unrealized capital gains and losses.



     (p) “Share Incentive Plan” means the Company’s 2006 Share Incentive Plan, as it may be
amended and restated from time to time, or any successor plan thereto.



     (q) “Share Ownership Guidelines” means the share ownership guidelines for executive
officers of the Company adopted by the Board, as may be amended by the Board from time to time in
its sole discretion.



     (r) “Share Units” means a non-voting unit of measurement based on the Common Shares,
which entitles a Participant to receive a payment in cash or Common Shares, as determined by the
Committee upon the payment of an Award.



     (s) “Share Unit Award” means an Award pursuant to the terms of the Plan and the Share
Incentive Plan entitling a Participant to a payment based on the Fair Market Value (as defined in
the Share Incentive Plan) of the Common Shares as of the date of payment of the Award.



     (t) “Threshold Average Annual ROE” means the threshold level for purposes of the Plan
of the Average Annual ROE of the Company for all Plan Years in a Performance Cycle, as



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established by the Committee in its sole discretion, below which no payment in respect of an Award shall be
made.



Section 3. Plan Administration




     (a) Committee Members. The Plan shall be administered by the Committee. The
Committee shall have such powers and authority as may be necessary or appropriate for the Committee
to carry out its functions as described in the Plan. No member of the Committee shall be liable
for any action or determination made in good faith by the Committee with respect to the Plan or any
Award hereunder.



     (b) Discretionary Authority. Subject to the express limitations of the Plan, the
Committee shall have authority in its sole discretion to determine the time or times at which
Awards may be granted, the recipients of Awards, the form of payment under an Award and all other
terms of an Award. The Committee shall also have discretionary authority to interpret the Plan, to
make all factual determinations under the Plan, and to make all other determinations necessary or
advisable for the administration of the Plan. The Committee may prescribe, amend, and rescind
rules and regulations relating to the Plan. All interpretations, determinations, and actions by
the Committee shall be final, conclusive, and binding upon all parties.



     (c) Delegation of Authority. The Committee shall have the right, from time to time,
to delegate to one or more officers of the Company the authority of the Committee to grant and
determine the terms and conditions of Awards under the Plan, subject to such limitations as the
Committee shall determine. The Committee shall also be permitted to delegate, to any appropriate
officer or employee of the Company, responsibility for performing ministerial functions under the
Plan. In the event that the Committee’s authority is delegated to officers or employees in
accordance with the foregoing, all provisions of the Plan relating to the Committee shall be
interpreted in a manner consistent with the foregoing by treating any such reference as a reference
to such officer or employee for such purpose. Any action undertaken in accordance with the
Committee’s delegation of authority hereunder shall have the same force and effect as if such
action was undertaken directly by the Committee and shall be deemed for all purposes of the Plan to
have been taken by the Committee.



Section 4. Eligibility and Participation




     The executive officers and other senior officers of the Company who are designated by the
Committee in its sole discretion shall be eligible to participate in the Plan for any Performance
Cycle. Each such eligible employee who is designated by the Committee to receive an Award for a
Performance Cycle shall become a Participant in the Plan with respect to such Performance Cycle.
All Participants shall be designated by the Committee on a prospective basis only with respect to
Performance Cycles commencing on or after the date of participation.



Section 5. Grant of Awards




     (a) General. Within ninety (90) days following the commencement of a Performance
Cycle, the Committee may grant to a Participant under the Plan an Award specifying a number of
Share Units subject to the Award. The Committee shall establish on a prospective basis a schedule
of Performance Percentages to be applied to a Participant’s Award relative to the



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Company’s achievement of certain levels of Average Annual ROE, which shall include a Threshold Average Annual
ROE. The Committee shall also establish for each Performance Cycle the terms and conditions of
Awards under the Plan. The amount payable under an Award shall be determined by multiplying the
applicable Performance Percentage based on the degree
of achievement of Average Annual ROE for a given Performance Cycle by the number of Share
Units subject to a Participant’s Award in respect of such Performance Cycle. Any fractional Share
Units resulting from the foregoing calculation shall be rounded upwards to the nearest whole Share
Unit.



     (b) Performance Cycles. The Committee is authorized in its sole discretion to
determine the length of any Performance Cycle and to establish new Performance Cycles on an annual
basis. Performance Cycles may commence each Plan Year and may be overlapping. There shall be no
requirement of conformity among different Performance Cycles with respect to their duration, the
applicable Threshold Average Annual ROE, the Performance Percentages or the Participants.



     (c) Average Annual ROE. Awards under the Plan are based upon the Average Annual ROE
of the Company for a Performance Cycle. Average Annual ROE may be determined by the Committee
after excluding charges for restructurings, discontinued operations, extraordinary items, and other
unusual or non-recurring items, and the cumulative effects of accounting changes, or taking into
account such other factors as the Committee deems appropriate in its sole discretion to adjust the
measure of Average Annual ROE for any Plan Year during a Performance Cycle.



Section 6. Payment of Awards




     (a) Form and Timing of Payment. Payment of Awards under the Plan shall be made in
cash, Common Shares, or any combination thereof, as determined by the Committee in its sole
discretion taking into account the Company’s Share Ownership Guidelines. Subject to the
requirements of section 409A of the Internal Revenue Code, Awards shall be paid to Participants at
such time or times as the Committee shall determine in its sole discretion following the
Committee’s review and approval of the financial results for a completed Performance Cycle.



     (b) Tax Withholding. All payments under the Plan shall be subject to applicable
income and employment taxes and any other amounts that the Company is required by law to deduct and
withhold from such payments.



Section 7. Termination of Employment




     (a) General Rule. Subject to the provisions of Section 7(b) hereof, the obligation of
the Company to make payment of an Award to a Participant hereunder is conditioned upon the
continued employment of the Participant with the Company at the time of payment of an Award
hereunder. If the employment of a Participant with the Company is terminated for any reason, at
any time prior to the time of payment of an Award hereunder, the Award shall be forfeited and
automatically be cancelled without further action of the Company, unless otherwise provided by the
Committee.



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     (b) Exceptions. The Committee may, in its sole discretion, provide for the payment of
an Award in the event a Participant’s employment with the Company is terminated for any reason
including, but not limited to, a termination by the Company without cause or as a result of the
Participant’s death or disability. Such payment may be made on a pro-rated or accelerated basis as
determined by the Committee in its sole discretion. To the extent that a Participant is a
party to an employment agreement with the Company containing provisions for the treatment of
Awards under the Plan upon a termination of employment, such provisions of the employment agreement
shall govern and control for purposes of this Section 7.



Section 8. Change in Control




     In the event of a Change in Control of the Company, each Participant shall, subject to the
continued employment of the Participant with the Company at the time of the Change in Control,
receive a payment in respect of an outstanding Award on a pro rata basis, based on the period of
service by the Participant and the performance levels (Average Annual ROE vs. Threshold Average
Annual ROE) achieved by the Company for the Performance Cycle as of the end of the fiscal quarter
immediately preceding the date of the Change in Control, as determined by the Committee prior to
the Change in Control. Any payment made under this Section 8 shall be made as soon as practicable
following the occurrence of the Change in Control. To the extent that a Participant is a party to
an employment agreement with the Company containing provisions for the treatment of Awards under
the Plan upon a Change in Control, such provisions of the employment agreement shall govern and
control for purposes of this Section 8.



Section 9. General Provisions




     (a) Effective Date. The Plan shall be effective with respect to Plan Years and
Performance Cycles beginning on or after January 1, 2006.



     (b) Amendment and Termination. The Company may, from time to time, by action of the
Board, amend, suspend or terminate any or all of the provisions of the Plan, but no such amendment,
suspension or termination shall adversely affect the rights of any Participant with respect to
Awards then outstanding.



     (c) Coordination
with Section 162(m) Plan. All Awards granted under the Plan to
Participants who shall also be Participants in the Company’s “Section 162(m) Performance Incentive
Plan” for a Plan Year or Performance Cycle shall be subject to the terms and conditions of such
plan, and in the event of any conflict, the terms of the Section 162(m) Performance Incentive Plan
shall govern and control.



     (d) Section 409A Compliance. To the extent applicable, it is intended that the Plan
comply with the provisions of section 409A of the Internal Revenue Code, and the Plan shall be
construed and applied in a manner consistent with this intent. Any provision that would cause any
amount payable under the Plan to be includible in the gross income of a Participant under section
409A(a)(1) of the Internal Revenue Code shall have no force and effect. Notwithstanding any other
provision of the Plan to the contrary, the Board may amend the Plan and any outstanding Award
solely to comply with any new regulations or other guidance from



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the Internal Revenue Service under section 409A of the Internal Revenue Code without the consent of the Participant.



     (e) No Right to Employment. Nothing in the Plan shall be deemed to give any
Participant the right to remain employed by the Company or to limit, in any way, the right of the
Company to terminate, or to change the terms of, a Participant’s employment at any time.



     (f) No Presumption of Awards. Neither the adoption of the Plan by the Board nor any
of the terms of the Plan shall be deemed to create any rights of an employee to the grant of an
Award hereunder, nor to obligate the Company to grant any Awards under the Plan for any Plan Year.



     (g) Governing Law. The Plan shall be governed by and construed in accordance with the
laws of New York, without regard to choice-of-law rules thereof.



PLATINUM UNDERWRITERS HOLDINGS, LTD.




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