c58383_ex10-6.htm -- Converted by SEC Publisher, created by BCL Technologies Inc., for SEC Filing







Exhibit 10.5


2008 FORM OF AMENDMENT TO EMPLOYMENT AGREEMENT IN RESPONSE TO

INTERNAL REVENUE CODE SECTION 457A 


     AMENDMENT TO EMPLOYMENT AGREEMENT (“Amendment”) dated as of _____________, 2008 between XL Capital Ltd, a Cayman Islands corporation (the “Company”) and
_____________ (the “Executive”). 


     WHEREAS, the Company and the Executive are parties to an Employment Agreement dated as of ______________ (the “Agreement”);


     WHEREAS, the Company and the Executive wish to amend the Agreement as set forth herein; 


     NOW, THEREFORE, in consideration of the mutual covenants herein contained, and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Company, the
Guarantors (as defined in the Agreement) and the Executive hereby agree as follows: 


     1. The last paragraph of Section 8(d)(iii) is amended by deleting “10 days thereafter” and replacing it with “on the date of the
409A Change in Control.” 


     2. The first sentence of Section 18(d) is amended to read in its entirety as follows: 


	 	“Each Party shall bear its own costs incurred
        in connection with any proceeding under Sections 18(a) or 18(b) hereof,
        including all legal fees and expenses; provided, however,
        that the Company shall bear all such costs of the Executive (to the extent
        such costs are reasonable) if the Executive substantially prevails in
        a proceeding following her “separation from service” (as defined
    below) with the Company. 	 




     3. Section 25(b) is amended to read in its entirety as follows:


	 	     “(b) Without prejudice
        to the characterization of any other amounts payable under this Agreement,
        the parties hereto specifically intend that any amounts payable under
        Section 8(d)(ii)(A)-(C), Section 8(d)(iii)(A)-(D) and Section 11 will
        not be considered deferred compensation for purposes of Section 409A
        due to Treas. Reg. Section 1.409A-1(b)(4) or another applicable exception.
        However, notwithstanding any provision to the contrary in this Agreement,
        if the Executive is deemed on the date of her “separation from service” (within
        the meaning of Treas. Reg. Section 1.409A-1(h)) with the Company to
        be a “specified employee” (within the meaning of Treas. Reg.
        Section 1.409A-1(i)), then with regard to any payment or benefit that
        is considered deferred compensation under Section 409A payable on account
        of a “separation from service” that is required to be delayed
        pursuant to Section 409A(a)(2)(B) of the Code (after taking into account
    any ap-	 




 









	 	plicable exceptions to such requirement), such payment
        or benefit shall be made or provided on the date that is the earlier
        of (i) the expiration of the six (6)-month period measured from the date
        of the Executive’s
“separation from service,” or (ii) the date of the Executive’s
death (the “Delay Period”). Upon the expiration of the Delay Period,
all payments and benefits delayed pursuant to this Section 25(b) (whether they
would have otherwise been payable in a single sum or in installments in the absence
of such delay) shall be paid or reimbursed to the Executive in a lump sum and
any remaining payments and benefits due under this Agreement shall be paid or
provided in accordance with the normal payment dates specified for them herein.
Notwithstanding any provision of this Agreement to the contrary, for purposes
of any provision of this Agreement providing for the payment of any amounts or
benefits upon or following a termination of employment, references to the Executive’s “termination
of employment” (and corollary terms) with the Company shall be construed
to refer to the Executive’s “separation from service” (within
the meaning of Treas. Reg. Section 1.409A-1(h)) with the Company. With respect
to any reimbursement or in-kind benefit arrangements of the Company and its subsidiaries
that constitute deferred compensation for purposes of Section 409A, except as
otherwise permitted by Section 409A, the following conditions shall be applicable:
(i) the amount eligible for reimbursement, or in-kind benefits provided, under
any such arrangement in one calendar year may not affect the amount eligible
for reimbursement, or in-kind benefits to be provided, under such arrangement
in any other calendar year (except that the health and dental plans may impose
a limit on the amount that may be reimbursed or paid), (ii) any reimbursement
must be made on or before the last day of the calendar year following the calendar
year in which the expense was incurred, and (iii) the right to reimbursement
or in-kind benefits is not subject to liquidation or exchange for another benefit.
Whenever a payment under this Agreement specifies a payment period with reference
to a number of days (e.g., “payment
shall be made within thirty (30) days after termination of employment”),
the actual date of payment within the specified period shall be within the sole
discretion of the Company. Whenever payments under this Agreement are to be made
in installments, each such installment shall be deemed to be a separate payment
for purposes of Section 409A.” 	 



     4. The
definition of “Good Reason” in Exhibit B is amended to read in its
entirety as follows:   

	 	     “For purposes of this Agreement, “Good
        Reason” shall mean any of the following, unless done with the prior
    express written consent of Executive: 	 
	 	 	 
	 	     (i) (A) The assignment
        to Executive of duties materially inconsistent with Executive’s
        position (including duties, responsibilities, status, titles or offices
        as set forth in Section 3 hereof); (B) any material diminution or material
        reduction of Executive’s duties or responsibilities except in connection
        with the termination of Executive’s employment for Cause, disability
        or as a result of Executive’s death or by Executive other than for
        Good Reason; (C) a material diminution in the authorities, duties or
    responsibilities of the supervisor to whom Ex-	 


 


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	 	ecutive is required to report; or (D) a material diminution
    in the budget over which Executive retains authority; 	 
	 	 	 
	 	     (ii) The (A) material
        reduction in Executive’s Base Salary from the level in effect immediately
        prior to the Change in Control, or (B) material diminution in bonus opportunity
    that results in a material reduction in Executive’s compensation; 	 
	 	 	 
	 	     (iii) Any material breach
        by the Company or the Guarantors of this Agreement or any material agreement
    entered into pursuant thereto; 	 
	 	 	 
	 	     (iv) Notwithstanding
        the provisions of Section 3(b) of this Agreement, requiring Executive
        to be based at any office or location that is greater than 35 miles from
        the office or location at which Executive was principally located immediately
    prior to the Change in Control;	 
	 	 	 
	 	    (v) During the Post-Change
        Period, the failure to continue in effect any material compensation or
        incentive plan in which Executive participates immediately prior to the
        time of the Change in Control unless an equitable arrangement (embodied
        in an ongoing substitute or alternative plan providing Executive with
        substantially the same aggregate economic opportunity on an after-tax
        basis available to the Executive immediately prior to the Change in Control)
        has been made with respect to such plan in connection with the Change
        in Control, or the failure to continue Executive’s participation
        therein on substantially the same basis as existed at the time of the
        Change in Control, which in any such case results in a material reduction
    in Executive’s compensation.	 
	 	 	 
	 	     Notwithstanding any
        provision in this Agreement to the contrary, the Executive must give
        written notice of her intention to terminate her employment for Good
        Reason within sixty (60) days after the act or omission which constitutes
        Good Reason, and the Company shall have thirty (30) days from such notice
        to remedy the condition, in which case Good Reason shall no longer exist
        with regard to such condition. Any failure to give such written notice
    within such period will result in a waiver by the Executive of her right
        to terminate for Good Reason as a result of such act or omission. Any
        termination hereunder shall occur within one hundred twenty (120) days
    after the Good Reason event occurs.” 	 



      5. Except
    as set forth herein, the Agreement shall continue in full force and effect
    in accordance with its terms. 


     6. All questions concerning the construction, validity and interpretation of this Amendment and the Agreement shall be construed and governed
in accordance with the laws of the State of New York, without reference to the principles of conflict of laws thereof.


     7. This Amendment may be executed simultaneously in two or more counterparts, any one of which need not contain the signatures of more than one
party, but all of which counterparts taken together will constitute one and the same agreement. 


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

	 	
      XL CAPITAL LTD	
	 	 	 
	 	By:	
 	
	 	 	 
	 	
      GUARANTORS:	
	 	 	 
	 	
      XL INSURANCE (BERMUDA) LTD	
	 	
      (formerly XL INSURANCE LTD)	
	 	 	 
	 	By:	
 	
	 	 	 
	 	
      XL RE LTD	
	 	 	 
	 	By:	
 	
	 	 	 
	READ, ACCEPTED & AGREED	 	 
	 	 	 
	________________________________________	 	 
	Name of Executive Officer	 	 
	 	 	 




 




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SCHEDULE 1


As of June 30, 2009, the following Executive Officers were parties to this Form of Agreement:


Kirstin R. Gould

Celia R. Brown