rsu_plan.htm


    

    Amended
and Restated Flagstone Reinsurance Holdings Limited

    Employee
Restricted Share Unit Plan

    


    


    Section  1 –
Purpose of the Plan

    


    
      	
              1.01

            	
              Flagstone
      Reinsurance Holdings Limited (the “Company”) adopted this Amended and
      Restated Flagstone Reinsurance Holdings Limited Employee Restricted Share
      Unit Plan (the “Plan”), effective as of July 20th
      2007 for the benefit of the Directors, officers, and Employees of the
      Company.  The purpose of the Plan is to promote a proprietary
      interest in the Company and its Subsidiaries among its Directors,
      officers, and employees; encourage the Directors, officers, and Employees
      of the Company to further the development of the Company; and to attract
      and retain the key employees necessary for the Company’s long-term
      success.  This Plan amends and restates in its entirety the
      Flagstone Reinsurance Holdings Limited Employee Restricted Share Unit Plan
      adopted on July 1, 2006 and amended in November,
  2007.

            


    

    


    Section 2 –
Definitions

    


    
      	
              2.01

            	
              General
      – Whenever the following terms are used in the Plan with the first letter
      capitalized, they shall have the meanings specified below unless the
      context clearly indicates to the contrary or as provided under Section 7
      of the Plan.

            


    

    


    
      	
              2.02

            	
              “Account”
      of a Participant means his or her individual account, if any, or the
      account of a Director’s employer, as established in accordance with
      Section 6.

            


    

    


    
      
        	
                2.03

              	
                “Beneficiary”
      means the person or persons designated by a Participant, on a form
      provided by the Plan Administrator, to receive payments under the Plan in
      the event of the Participant’s death.

              
	 	 
	2.04	
                “Board”
      means Board of Directors of the
Company.

              


      

    

     

    
    

    
      
        	
                2.05

              	
                “Cause”
      shall mean (a) a material breach by a Participant of any contract between
      the Participant and the Company or a Subsidiary; (b) the willful and
      continued failure or refusal by the Participant to perform any duties
      reasonably required by the Company or a Subsidiary, after notification by
      the Company or the Subsidiary of such failure or refusal, and failure to
      correct such behaviour within 20 days of such notification; (c) commission
      by the Participant of a criminal offence or other offence of moral
      turpitude; (d) perpetration by the Participant of a dishonest act or
      common law fraud against the Company or a Subsidiary or a client of
      either; or (e) the Participant willfully engaging in misconduct which is
      materially injurious to the Company or a Subsidiary, including without
      limitation, the disclosure of any trade secrets, financial models, or
      computer software to persons outside the Company or a Subsidiary without
      the consent of the Company or a Subsidiary.

              
	 	 
	2.07	“Compensation
      Committee” means the Compensation Committee of the Board of Directors of
      the Company.
	 	 
	2.08        	“Common
      Stock” means common shares of the Company.
	 	 
	2.09        	“Company”
      means Flagstone Reinsurance Holdings Limited.
	 	 
	2.10        	“Director”
      means a member of the board of directors of the Company or its
      Subsidiaries.


         

         

         

         

        
          
            
            

          

          
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              Flagstone
Reinsurance Holdings
Limited                                                                                                                                          


              Employee
Restricted Share Unit Plan

            

          

        

         

         

         

        	
                2.11

              	
                “Disability”
      means a condition by which the Compensation Committee has determined that
      the physical or mental condition of the Participant is such as would
      entitle him to receive payment of monthly benefits under any disability
      plan of the Company or a Subsidiary in which the individual
      participates.

              
	 	 
	2.12        	“Employee”
      means an employee of the Company or its Subsidiaries.
	 	 
	2.13	“Grant
      Certificate” means a certificate evidencing the credit of or grant to a
      Participant of a Restricted Share Unit under the Plan (sample attached as
      Appendix 5).
	 	 
	2.14	
                “Inter
      Vivos Designee” means any person or body of persons corporate or
      unincorporate, association, trust, partnership or similar entity or
      arrangement designated by a Participant, on a form provided by the Plan
      Administrator, to hold such RSUs granted to the Participant under the Plan
      and receive payments under the Plan during the life of the
      Participant.

              
	 	 
	2.15	
                “Participant”
      means any Employee, officer, or Director, except for Management Directors,
      of the Company or its Subsidiaries who (1) are eligible for RSU credits or
      grants under the Plan and (2) the Compensation Committee decides pursuant
      to its authority under Section 3.01 of the Plan to grant or credit an RSU
      award.

              
	 	 
	
                2.16

              	
                “Plan”
      means the Flagstone Reinsurance Holdings Limited Employee Restricted Share
      Unit Plan, as it may be amended from time to time.

              
	 	 
	
                2.17

              	
                “Plan
      Administrator” means the Compensation Committee, or the person or persons
      appointed by the Compensation Committee to serve under Section 4 of the
      Plan.

              
	 	 
	
                2.18

              	
                “Restricted
      Share Unit” (or “RSU”) means a right to receive a payment, in cash or in
      actual Common Stock of the Company, of the value of Common Stock of the
      Company, subject to the terms of this Plan and the respective Grant
      Certificate.

              
	 	 
	 2.19	“Subsidiary”
      means a subsidiary of the Company.


      

    

                   


    


    Section 3 – Awards Subject
to the Plan

    


    
      	
              3.01

            	
              Under
      the Plan, the Compensation Committee, in its sole discretion, may grant
      RSUs to Participants or credit RSUs to Directors’ Accounts.  The
      total stock credits or grants under the Plan shall not
      exceed (a) that amount required to satisfy the Director requests
      for fees to be paid in shares, plus (b) 0.2 percent of the total issued
      and outstanding share capital of the Company per annum or as
      decided by the Compensation Committee.  To the extent
      that any RSU granted or credited under the Plan expires, terminates, or is
      cancelled, such unissued stock credits or grants shall again be available
      for grant or credit under the Plan.

            


    

    


    
      	
              3.02

            	
              The
      RSUs will normally be settled by delivery of Common Stock, but can be
      settled to the Participant on distribution in cash, by issuance of shares
      of Common Stock, or partly in cash and partly by issuance of shares of
      Common Stock as determined by the Compensation Committee; provided that
      Participants who are UK domiciled for tax purposes may only receive
      distributions by issuance of shares of Common
  Stock.

            


    

     

     

     

    
      
        
        

      

      
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          Flagstone
Reinsurance Holdings
Limited                                                                                                                                          


          Employee
Restricted Share Unit Plan

        

      

    

     

    
 

    
      	
              3.03

            	
              The
      amount of cash, if any, to be paid in lieu of issuance of shares of Common
      Stock under the Plan shall be determined based on the net book value per
      share of Common Stock (or market value, if the Company’s shares are freely
      tradable on an exchange) as of the date on which a Participant becomes
      entitled to payment, whether or not such payment is
    deferred.

            


    

    


    


    Section 4 –
Administration

    


    
      	
              4.01

            	
              The
      Plan shall be administered by the Compensation Committee, and the
      Compensation Committee shall have the sole authority to interpret the
      Plan, to establish and revise rules and regulations relating to the Plan
      (including this Plan document), and to make any other determinations that
      it believes necessary or advisable for the administration of the
      Plan.  All of the powers and responsibilities of the
      Compensation Committee under the Plan may be delegated by the Compensation
      Committee, in writing, to any Compensation Subcommittee or appropriate
      Company personnel thereof.  The Board of Directors or the
      Shareholders of the Company can overrule the Compensation
      Committee.

            


    

    


    Section 5 –
Participation

    


    
      	
              5.01

            	
              The
      Management Committee of the Company will recommend, and the Compensation
      Committee will approve, the Participants in the
      Plan.  Participation in the Plan will be limited to officers,
      Employees, and Directors (excluding Management Directors) of the Company
      or its Subsidiaries.  Participants in the Plan may also
      participate in the Flagstone Reinsurance Holdings Limited Performance
      Share Unit Plan (the “PSU Plan”) sponsored by the Company, however such
      persons shall not be eligible to receive grants of RSUs and Performance
      Share Units in the same calendar year.  In addition,
      participation in the Plan shall be limited only to those individuals who
      are approved by the Compensation Committee and whose participation in the
      Plan is evidenced by a Grant Certificate executed by the
      Company.

            


    

    


    Section 6 – Terms of the
Grant or Credit of RSUs

    


    
      	
              6.01

            	
              The
      Compensation Committee may grant RSUs to a Participant pursuant to the
      Plan.  In addition, a Director of the Company may elect to
      substitute all or a percentage of his/her compensation for services
      performed for the Company with RSUs issued under the Plan, such amount to
      be credited to his/her Account as RSUs. A Director who serves on the Board
      on behalf of his/her employer may stipulate that amounts be credited to
      such employer’s Account as RSUs.  Grants or credits of RSUs
      shall be evidenced by a Grant Certificate in such form as the Compensation
      Committee shall from time to time
approve.

            


    

    


    
      	
              6.02 

            	
              A
      Director who is a Participant in the Plan shall elect no later than
      December 31 of the year prior to the year with respect to which the
      compensation is earned (or for the first year of the Plan, no later than
      the last day of the month prior to the Plan’s effective date), the dollar
      amount or percentage of compensation for such year to be converted into
      RSUs and credited to his/her Account pursuant to the written terms of the
      Plan and the Grant Certificate.

            


    

     

     

     

    
      
        
        

      

      
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          Flagstone
Reinsurance Holdings
Limited                                                                                                                                          


          Employee
Restricted Share Unit Plan

        

      

    

     

     

    
      	
              6.03

            	
              Upon
      a grant or credit of an award of RSUs under the Plan, as applicable, a
      Participant’s Account shall be credited with the amount of such grant or
      credit.

            


    

    


    
      	
              6.04

            	
              Actual
      shares of Company Common Stock or cash (as determined by the Committee),
      equal in amount to the number of RSUs that have vested, will be
      distributed to the Participant upon the earlier of the following: (a)
      separation from service other than for cause, (b) satisfaction of the
      applicable vesting period(s), (c) a specific date, or (d) such other time
      as the Committee may in its sole discretion determine (collectively, the
      “Distribution Dates”).  The Company shall deliver the shares of
      Common Stock of the Company and/or cash to the Participant as soon as
      administratively feasible after the identified date of
      distribution.

            


    

    


    
      	
              6.05

            	
              Grants
      of RSUs under the Plan will normally fully vest on the date that is
      specified in the applicable Grant Certificate, subject to the
      following:

            


    

     

    
      
        	 
      	
                6.05.1

              	
                Upon
      a Participant’s death or Disability, he/she shall become fully vested in
      all RSUs that have been credited or granted under the
  Plan.

              
	 
      	 
      	 
      
	 
      	
                6.05.2

              	
                Except
      as otherwise provided herein, the unvested RSU’s of Participants who are
      Employees or Officers shall be canceled upon notice of termination from
      the Employer to the Employee or the notice of resignation of the
      Employee.

              
	 
      	 
      	 
      
	 
      	
                6.05.3

              	
                Notwithstanding
      6.06.2, at the discretion of the Compensation Committee, vesting of RSUs
      that are granted under the Plan may continue for Employees who separate
      from service with the Company after at least five years’
      service.

              
	 
      	 
      	 
      
	 
      	
                6.05.4 –

              	
                If
      an Employee is terminated for Cause all of his RSU’s will be automatically
      canceled.

              
	 
      	 
      	 
      
	 
      	
                6.05.5

              	
                The
      RSU’s of a Director shall normally vest on the date noted on the Grant
      Certificate, unless accelerated under 6.04.1, and regardless of whether
      that Director continues to serve. The Compensation Committee can cancel
      the RSU’s of a Director, whether vested or not, if that director engages
      in action deemed to be materially hostile to the interests of the Company,
      as judged by the Board of Directors.

              
	 
      	 
      	 
      
	 
      	
                6.05.6

              	
                The
      Compensation Committee may, in its sole discretion, accelerate the vesting
      of any RSUs credited or granted under the Plan at any
  time.

              


      

    

     

     

    
      	
              6.06

            	
              RSUs
      and the rights and privileges conferred therewith shall not be sold,
      transferred, encumbered, hypothecated, or otherwise anticipated by the
      Participant, except as provided for under the terms of the
      Plan.  This Award is not liable for or subject to, in whole or
      in part, the debts, contracts, liabilities, or torts of the Participant,
      nor shall it be subject to garnishment, attachment, execution, levy, or
      other legal or equitable process.

            


    

    


    


    


     

    
      
        
        

      

      
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          Flagstone
Reinsurance Holdings
Limited                                                                                                                                          


          Employee
Restricted Share Unit Plan

        

      

    

     

    
 

    


    


    Section 7 – Special
Provisions

    


    
      	
              7.01

            	
              The
      Plan has special provisions which apply variously to citizens, residents,
      domiciliaries, of certain countries, or employees of Company subsidiaries
      located in certain countries. These provisions form part of this Plan and
      are attached as Appendix 4.

            


    

    


    
      	
              7.02

            	
              The
      Company may extend or amend Appendix 4 from time to time in order to
      accommodate the development of the Company in new countries, to maintain
      the most tax-favorable status available in various countries under the
      applicable laws and further modifications/amendments carried out from time
      to time. Such technical amendments require the approval of the Management
      Compensation Committee of the Company, and the Chairman of the
      Compensation Committee.

            


    

    


    Section 8 –
Taxation

    
      	
              8.01 –

            	
              Participants
      shall be responsible for all individual tax consequences of the RSU grants
      under the Plan.  Where feasible, the Plan will be interpreted
      and administered to provide favorable tax treatment to the Participant,
      subject to the compliance with the applicable laws of their respective
      jurisdiction.

            


    

    


    
      	
              8.02
      -

            	
              The Company reserves the right to
      withhold shares or deduct from the Participant payroll any taxes or social
      benefit costs to the Participant or the Company associated with the
      vesting or fulfillment of the
RSUs.

            


    

    


    


    Section 9 – Designation of
Beneficiary

    


    
      	
              9.01

            	
              A
      Participant, by filing the prescribed form (the “Beneficiary Designation
      Form”, sample attached as Appendix 2) with the Plan Administrator, or such
      other person as the Plan Administrator may designate from time to time,
      may designate one or more Beneficiaries and successor Beneficiaries who
      shall be given the rights to the RSUs in accordance with the terms of the
      Plan in the event of the Participant’s death.  A Participant may
      change the designation of a Beneficiary at any time by completing a new
      Beneficiary Designation Form that shall revoke and supersede all earlier
      forms.  In the event a Participant does not file a Beneficiary
      Designation Form designating one or more Beneficiaries, or no designated
      Beneficiary survives the Participant, the RSUs shall be given to the
      individual to whom such right passes by will or the laws of descent and
      distribution and/or succession.

            


    

    


    
      	
              9.02  

            	
              A
      Participant, by filing the prescribed form (the “Inter Vivos Designee
      Form”, sample attached as Appendix 1) with the Plan Administrator, or such
      other person as the Plan Administrator may designate from time to time,
      may designate one or more Inter Vivos Designees and successor Inter Vivos
      Designees who shall be given the rights to all past, present and future
      grants or series of RSUs, or to one or more specific grants or series of
      RSUs, designated within the Inter Vivos Designee Form during the life of
      the Participant and in accordance with the terms of the Plan.  A
      Participant may change the designation of any Inter Vivos Designee by
      completing a new Inter Vivos Designation Form that shall revoke and
      supersede all earlier forms. In the event a Participant does not file an
      Inter Vivos Designation Form designating one or more Inter Vivos
      Designees, or no Inter Vivos Designee survives the Participant, the RSUs
      and any payment of shares in place of cash shall be given to the
      Participant.

            


    

     

     

     

    
      
        
        

      

      
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          Flagstone
Reinsurance Holdings
Limited                                                                                                                                          


          Employee
Restricted Share Unit Plan

        

      

    

     

    
 Section 10 – Expenses of the
Plan

    


    10.01      Costs
of administration of the Plan will be paid by the Company.

    


    Section 11 – Claims
Procedure

    


    
      	
              11.01

            	
              In
      general, any claim for benefits under the Plan shall be filed by the
      Participant or beneficiary (“claimant”) on the form prescribed for such
      purpose with the Plan Administrator.  If a claim for benefits
      under the Plan is wholly or partially denied, notice of the decision shall
      be furnished to the claimant by the Plan Administrator within a reasonable
      period of time after receipt of the claim by the Plan
      Administrator.  A Participant who is denied a claim for benefits
      may appeal to the Compensation Committee for a review of the Plan
      Administrator’s decision.  The decision of the Compensation
      Committee shall be furnished to the Participant within a reasonable period
      of receipt of the request for review and the decision of the Compensation
      Committee shall be final and binding to the
  Participant.

            


    

    


    Section 12 – Termination or
Amendment of the Plan

    


    
      	
              12.01

            	
              The
      Plan may be amended in whole or in part from time to time, or may be
      terminated, by the Board in accordance with the bye-laws of the Company,
      provided that in event of such amendment or termination, the rights of the
      Participants related to an RSU that have been granted under the Plan shall
      be preserved and maintained and no amendment may confer additional
      benefits upon Participants without prior approval by the
      Board.  Notice of any amendment or termination of the Plan shall
      be given in writing to the
Participant.

            


    

    


    Section 13 –Term of the
Plan

    


    
      	
              13.01

            	
              The
      Plan shall become effective on the date it is adopted by the Company and
      shall continue in effect as amended from time to time until terminated
      pursuant to Section 12.

            


    

    


    Section 14 – Rights as a
Stockholder

    


    
      	
              14.01

            	
              No
      Participant shall have any rights (including voting or dividend rights) as
      a shareholder of the Company with respect to any Common Stock covered by,
      or related to, any RSU granted or credited pursuant to the Plan until the
      date of the delivery of a stock certificate with respect to such Common
      Stock.

            


    

    


    Section 15  –
Anti-Dilution and Other Adjustments

    


    
      	
              15.01

            	
              In
      the event of any change in the issued and outstanding shares of Common
      Stock of the Company by reason of any share split, share dividend,
      recapitalization, merger, consolidation, reorganization, amalgamation,
      combination or exchange of shares of Common Stock or other similar event,
      and if the Compensation Committee shall determine, in its sole discretion,
      that such change equitably requires an adjustment in the number or kind of
      shares of Common Stock of the Company that may be issued pursuant to RSUs
      under the Plan pursuant to paragraph 6, then such adjustment shall be made
      by the Compensation Committee and shall be conclusive and binding for all
      purposes of the Plan.

            


    

     

     

    
      	
              15.02 -

            	
              Upon
      the declaration by the Board of Directors of the Company of a dividend in
      specie or in kind in favor of the holders of Common Shares in the Company,
      the Compensation Committee shall determine, in its sole discretion, if
      such dividend equitably requires an adjustment in the number or kind of
      RSUs that may be issued to a Participant under the Plan in lieu of a
      dividend payment.

            


    

     

    Section 16 –
Miscellaneous

    


    
      	
              16.01

            	
              If
      any provision of this Plan shall be held invalid or unenforceable, such
      invalidity or unenforceability shall not affect any other provisions
      hereof, and this Plan shall be construed and enforced as if such
      provisions had not been included.

            


    

    


    
      	
              16.02

            	
              Except
      by will or the laws of descent and distribution and/or succession, a
      Participant’s rights and interest under the Plan may not be assigned or
      transferred in whole or in part either directly or by operation of law or
      otherwise (except in the event of Participant’s  death),
      including but not limited to, execution, levy, garnishment, attachment,
      pledge, bankruptcy or in any other manner and no such right or interest of
      any Participant in the Plan shall be subject to any obligation or
      liability or such Participant; provided that Directors shall be permitted
      to assign their rights under the Plan to their employer or an affiliate of
      their employer, as approved by the Compensation
  Committee.

            


    

    


    
      	
              16.03

            	
              Except
      to the extent specifically set forth in the Grant Certificate, the
      Participant’s rights under the Plan shall be governed in all aspects by
      the terms of the Plan, including the provisions that authorize the Plan
      Administrator to administer and interpret the Plan and that provide that
      the Plan Administrator’s decisions, determinations, and interpretations
      with respect to the Plan are final and conclusive on all persons affected
      hereby.  Additionally, This Plan shall be construed in
      accordance with, and governed by the laws of the
  Bermuda.

            


    

    


    
      	
              16.04

            	
              Nothing
      in this Plan, nor any action taken pursuant to this Plan, shall be deemed
      to give any Participant any right to remain in the employ of the Company
      or affect the right of the Company to terminate a Participant’s employment
      at any time, with or without Cause.

            


    

    


     

    *           *           *           *           *

    


    


    
      
        
           


        

        
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        Flagstone
Reinsurance Holdings
Limited                                                                                                                                          


        Employee
Restricted Share Unit Plan

      

    

    


    As
evidence of its adoption of the Plan, Flagstone Reinsurance Holdings Limited has
caused this instrument to be signed by its officer of representative duly
authorized on this 20th day of
July, 2007.

    


     

    
      
        
          	
                  FLAGSTONE
      REINSURANCE HOLDINGS LIMITED,

                
	
                  By:

                	 
      
	 
      	 
      
	
                  Title:

                	 
      


        

      

    

    


    


    


    
       

       

       

      
        
          
          

        

        
          Page 7 of
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            Flagstone
Reinsurance Holdings Limited

            Employee
Restricted Share Unit Plan

          

        

      

       

      
 

    

    


    APPENDIX
1

    


    Inter
Vivos Designee Form

    


    


    


    To:  The
Plan Administrator of the Flagstone Reinsurance Holdings Limited Employee
Restricted Share Unit Plan

    


    From:  __________________________________________

    


    


    *           *           *           *           *

    


    


    Pursuant
to Section 9 of the Flagstone Reinsurance Holdings Limited Employee Restricted
Share Unit Plan (the “Plan”), I hereby designate the following person(s) as
inter vivos designee(ies) who during my life shall be entitled to receive
amounts under the Plan and respective Grant Certificate:

    


    


    Primary
Inter Vivos Designee Name:
__________________________________________

    


    


    Secondary
Inter Vivos Designee
Name:  ________________________________________

    


    Grant
Certificates to which this designation applies:

    


    
      	
              (i)

            	
              Series/Year(s)
      _____________________

            


    

    


    or,

    


    
      	
              (ii)

            	
              All
      Grants
      after:                   /      
             /         
           _______________

            


    

          
Day    Month       Year

    


    In making
the above designation, I reserve the right to revoke this designation or change
the inter vivos designee(ies) designated at any time or times and without the
consent of any other person.

    


    This
designation cancels and supersedes any inter vivos designation previously made
with respect to this Plan and respective Grant Certificate.

    
 

    
      
        
        

      

      
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          Flagstone
Reinsurance Holdings Limited

          Employee
Restricted Share Unit Plan

        

      

    

    


     

    


    


    


    


     

     

     

    Signed:

     

    
 

    ______________________________

    Participant

     

     

    ______________________________

    Date

    


    


     

     

     

     

    
      
        
        

      

      
        Page 9 of
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          Flagstone
Reinsurance Holdings Limited

          Employee
Restricted Share Unit Plan

        

      

    

    


    


    


     

     

    
 

    


    APPENDIX
2

    


    Beneficiary
Designation Form

    


    


    


    To:  The
Plan Administrator of the Flagstone Reinsurance Holdings Limited Employee
Restricted Share Unit Plan

    


    From:  __________________________________________

    


    


    *           *           *           *           *

    


    


    Pursuant
to Section 9 of the Flagstone Reinsurance Holdings Limited Employee Restricted
Share Unit Plan (the “Plan”), I hereby designate the following person(s) as
beneficiar(ies) who on my death shall be entitled to receive amounts under the
Plan and respective Grant Certificate:

    


    


    Primary
Beneficiary Name: __________________________________________

    


    


    Secondary
Beneficiary
Name:  ________________________________________

    


    


    In making
the above designation, I reserve the right to revoke this beneficiary
designation or change the beneficiar(ies) designated at any time or times and
without the consent of any beneficiary.

    


    This
beneficiary designation cancels and supersedes any beneficiary designation
previously made with respect to this Plan and respective Grant
Certificate.

    


     

     

    
      
        
        

      

      
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          Flagstone
Reinsurance Holdings Limited

          Employee
Restricted Share Unit Plan

        

      

    

     

     

     

     

    
      Signed:

       

      
 

      ______________________________

      Participant

       

       

      ______________________________

      Date

    

     

     

     

     

     

    
      
        
        

      

      
        Page 11 of
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          Flagstone
Reinsurance Holdings Limited

          Employee
Restricted Share Unit Plan

        

      

    

     

     

     

    APPENDIX
3

    


    Director
Participant Election and Account Designation Form

    


    To:  The
Plan Administrator of the Flagstone Reinsurance Holdings Limited Employee
Restricted Share Unit Plan

    


    From:  __________________________________________

    


    *           *           *           *           *

    


    Amount of
Compensation Deferred

    


    I hereby
elect to have the following amounts of compensation for services performed for
the Company for the 20___ year converted into RSUs.

    


    ________%  or
$________

    


    


    Distribution
Date(s)

    


    _________                      Separation
from service

    


    _________                      A
date certain (please specify date: __________________)

    


    


    Employer
Account Designation (for Directors providing services on behalf of their
Employer)

    


    Pursuant
to Section 6.01 of the Flagstone Reinsurance Holdings Limited Employee
Restricted Share Unit Plan (the “Plan”), I hereby designate the following as my
employer on whose behalf I provide services to the Board of Directors, and to
whose account RSUs shall be credited:

    


    Employer
Account Name: __________________________________________

     

    
Signed:

    


    ______________________________

    Director
Participant

     

     

     

    
 

    
      
        
        

      

      
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          Flagstone
Reinsurance Holdings Limited

          Employee
Restricted Share Unit Plan

        

      

    

     

     

    
      


      ______________________________

    

    Date

     

     

    
      
        
        

      

      
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          Flagstone
Reinsurance Holdings Limited

          Employee
Restricted Share Unit Plan

        

      

    

     

    
 

    APPENDIX
4

    


     Special
Provisions for citizens or residents of certain countries

    


    United States
Provisions

    


    Coverage:
These provisions apply to Participants to whom Section 409A of the United States
Internal Revenue Code of 1986 (as amended from time to time)(“the Code”)
applies.

    


    Provisions:

    1.   Each grant
and credit of RSUs shall comply with the minimum requirements of Code Section
409A,

    


    2.  Any action that
may be taken (and, to the extent possible, any action actually taken) by the
Company or the Participant shall not be taken (or shall be void and without
effect), if such action violates the requirements of Section 409A.

    


    3.  The definitions
contained within this Plan and the respective Grant Certificate shall be
interpreted and construed to comply with the minimum requirements of Section
409A.

    


    Canada
Provisions

    


    Coverage:
These provisions apply to Participants who are tax resident in
Canada.

    


    Provisions:
Distributions to Participants to whom this section applies shall be made only
upon the respective Participant’s separation from service or retirement from the
Company or its Subsidiary, and shall me made within one year of such separation
or retirement..

    


    India
Provisions

    


    Coverage:
These provisions apply to Participants who are employees of West End Capital
Management BPO Services (India) Pvt. Ltd., or any other Subsidiary of the
Company incorporated and existing under the laws of India (“Indian Subsidiary)
(collectively, “Indian Participants”)

    


    Provisions:
the following provisions shall apply with respect to any RSUs granted prior to a
public offering of the capital stock of the Company/Indian Subsidiary, and only
to the extent required by applicable law:

    


    
      	
              1.  

            	
              The
      aggregate number of RSUs which may be granted to Indian Participants under
      this Plan shall not exceed 300,000 or as decided by the Compensation
      Committee, and subject to the provisions of Section 3.01 hereof. RSU
      credits or grants subject to increase in accordance with the terms of the
      plan pursuant to the approval received from the Board of
      Directors/Shareholders of the
Company

            


    

    


    
      	
              2.  

            	
              The
      RSUs will be actually paid to the Indian Participants in accordance with
      the Section 3.02 and 3.03 of the
Plan.

            


    

     

     

     

     

    
      
        
        

      

      
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Reinsurance Holdings Limited

          Employee
Restricted Share Unit Plan

        

      

    

     

     

    
 

    
      	
              3.  

            	
              The
      approval of the Board of the Company to the Plan was accorded on 16 June
      2006. The assent of the Board of the Company, approving the adoption of
      the Plan including this Appendix, for the Indian Subsidiary was accorded
      on 16 June 2006.  The assent of the board of directors of the
      Indian Subsidiary approving the adoption of the Plan including this
      Appendix, for the Indian Subsidiary was accorded on
  [___].

            


    

    


    
      	
              4.  

            	
              Participation
      in the Plan and the grant of Awards shall be awarded to such Indian
      Participant providing bona fide services to or for, one or more Indian
      Subsidiary as may be selected by the Board or such Compensation Committee
      as designated by the Board, in consultation with the board of directors of
      the Indian Subsidiary, from time to time.  The Board may also
      grant RSUs to individuals in connection with hiring, retention or
      otherwise, prior to the date the individual first performs services for an
      Indian Subsidiary, provided that such RSUs shall not become vested or
      exercisable prior to the date the individual first commences performance
      of such services.  Provided, however, that an Employee who is a
      Promoter or belongs to the Promoter Group or a director who either by
      himself or through his relative or through any body corporate, directly or
      indirectly holds more than 10% of the outstanding shall not be eligible to
      participate in the Plan

            


    

    
      	
              5.  

            	
              For
      purposes of the above paragraph (4)

            


    

    


    
      	
              a.  

            	
              “Promoter”
      means –

            



    
      	
              i.  

            	the
      person or persons who are in over-all control of the Indian
      Subsidiary;
	
              ii.  

            	
              the
      person or persons who are instrumental in the formation of the Indian
      Subsidiary or programme pursuant to which shares of the Indian Subsidiary
      may be offered to the public;

            


    

    
      	
              iii.  

            	
              the
      person or persons who are named in the offer document (inviting
      subscription from the public to the shares of the Indian Subsidiary) as
      promoter(s), in the event the Indian Subsidiary decided to offer shares to
      the public.

            


    

    


    Provided
that a director or officer of the Indian Subsidiary, if he is acting as such
only in his professional capacity, will not be deemed to be a Promoter, and that
where a Promoter of the Indian Subsidiary is a body corporate, the promoter of
that body corporate shall also be deemed to be a Promoter of the Indian
Subsidiary.

    


    
      	
              b.  

            	
              “Promoter
      Group” means:

            


    

    
      	
              i.  

            	
              an
      immediate relative of the Promoter (i.e. spouse of that person, or any
      parent, brother, sister or child of the person or of the spouse);
      and,

            


    

    
      	
              ii.  

            	
              persons
      whose shareholding is aggregated for the purpose of disclosing in the
      offer document (inviting subscription from the public to the shares of the
      Indian Subsidiary) "shareholding of the promoter
  group"

            


    

    


    
      	
               
      

            	
              c.

            	
              “Relative”
      means immediate relative namely spouse, parent, brother, sister or child
      of the person or the spouse.

            


    

    


    
      	
              6.  

            	
              All
      defined terms that are not otherwise defined under this Appendix shall
      have the meaning attributed to them under the provisions of the
      Plan.

            


    

    


    
      	
              7.  

            	
              Except
      to the extent as set forth in this Appendix and where not contrary to the
      meaning or intention herein, the provisions of the Plan shall apply to the
      Indian Participants granted the
RSU.

            


    

     

     

     

     

     

    
      
        
        

      

      
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Reinsurance Holdings Limited

          Employee
Restricted Share Unit Plan

        

      

    

    
 

    UK
Provisions

    


    Distributions
to Participants who are UK [resident domiciled for tax
purposes]  shall be made only in shares, notwithstanding the
provisions Section 3.02, above.

     

     

     

     

     

    
      
        
        

      

      
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Reinsurance Holdings Limited

          Employee
Restricted Share Unit Plan

        

      

    

     

     

     

    APPENDIX
5

    


    Sample
RSU Grant Certificate

    


    


    This
CERTIFICATE, effective as of the ____________ day of ____________, 20___ (the
"Award Date"), certifies that Flagstone Reinsurance Holdings Limited (the
“Company”) has awarded to ________________________ (the “Participant”)
Restricted Share Units (“RSUs”) in the amounts and on the terms set forth below,
subject to and in accordance with the Flagstone Reinsurance Holdings Limited
Restricted Share Unit Plan, dated [●] (“the RSU Plan”).

    


    The
Company awards to the Participant on the Award Date an amount of RSUs as
follows:

    


    
      	
              RSU
      Holder

            	
              «Column1»

            
	
               
      

            	 
      
	
              Restricted
      Share Units

            	
              «Column2»

            
	 
      	 
      
	
              RSU
      Series

            	
              [●]

            
	 
      	 
      
	
              Grant
      Date

            	
              [●]

            
	 
      	 
      
	
              Vesting
      Date

            	
              [Normal
      Vesting: Grants of these RSUs under the Plan will fully vest on the date
      that is two years after the Grant Date immediately above, except as may be
      modified by section by the terms of the RSU Plan, and in particular
      section [6.05].

                  -or-

              [The
      Participant is a Director and is fully and immediately vested in RSUs that
      are credited to his/her Account under the
Plan.]

            


    

    


    Upon
occurrence of a Distribution Date, the shares of Company Common Stock or cash
(as determined solely by the Compensation Committee of the Board of Directors of
the Company) shall be payable to the Participant and shall be delivered to the
Participant as soon as administratively feasible.

    


    This RSU grant is subject to the
terms and conditions described in the RSU Plan, as such plan may be properly
amended from time to time.  The terms of the RSU Plan are
incorporated herein, and capitalized words, if not defined herein, shall be
given the same meaning as under the terms of the Plan, unless the context
requires a different meaning.

    


    This
RSU grant is not transferable, and will lapse upon the occasion of an
assignment, charge, disposal or other dealing with the rights conveyed by it in
any other circumstances.

    


     

     

     

    
      
        
        

      

      
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Reinsurance Holdings Limited

          Employee
Restricted Share Unit Plan

        

      

    

     

    
 

    


    
      
        


        ______________________________

      

      Signed

      Mark Byrne, Chairman

       

       

       

       

       

       

      
        
          
          

        

        
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            Flagstone
Reinsurance Holdings Limited

            Employee
Restricted Share Unit Plan

          

        

      

       

    

     

    DOCUMENT  REVISION
HISTORY

     

     

    
      	
              Amendment

            	
              Date

            	
              Summary
      of Changes

            	
              Section

            	
              Approved
      by

               

            
	
              Amendment
      1

            	
              1/7/06

            	
              Amended
      and Restated

            	
              Various

            	
              Board
      of Directors

            
	
              Amendment
      2

            	
              11/9/06

            	
              Section
      5 clarified

            	
              5.01

            	
              Board
      of Directors

            
	
              Amendment
      3

            	
              16/11/06

            	
              Amended
      & Restated

            	
              Various

            	
              Shareholders

            
	
              Amendment
      4

            	
              20/7/07

            	
              Amended
      & Restated

            	
              Various

            	
              Board
      of Directors

            
	
              Amendment
      5

            	
              15/5/08

            	
              Language
      added regarding notification procedure

              of
      beneficiary or Designee and ability for such

              Designations
      to retroactively effect prior RSU grants

            	
              9

            	
              Board
      of Directors

            


    

     

     

     

    Page 19 of 19