a Participant will entitle the
Participant to receive, without payment to the Company, all or part of a
specified amount determined by the Committee, if the terms and conditions
specified herein and in the Award are satisfied.
Each Performance Unit Award
shall be subject to the following terms and conditions:
(A)
THE COMMITTEE SHALL DETERMINE THE TARGET
NUMBER OF PERFORMANCE UNITS TO BE GRANTED TO A PARTICIPANT AFTER RECEIVING
RECOMMENDATIONS FROM THE COMPANY'S CHIEF EXECUTIVE OFFICER AND THE COMPANY OR
CERTAIN AFFILIATE'S MANAGEMENT TEAM.
PERFORMANCE UNIT AWARDS MAY BE GRANTED IN
DIFFERENT CLASSES OR SERIES HAVING DIFFERENT TERMS AND CONDITIONS.
(B)
THE PERIOD (THE "AWARD PERIOD") IN RESPECT
OF ANY GRANT OF A PERFORMANCE UNIT AWARD SHALL BE A THREE YEAR CYCLE OR AS THE
COMMITTEE SHALL OTHERWISE DETERMINE.
(C)
PARTICIPANTS ARE AWARDED PERFORMANCE UNITS
AT A VALUE OF $1,000 PER PERFORMANCE UNIT OR THE FOREIGN CURRENCY EQUIVALENT AT
THE BEGINNING OF EACH AWARD PERIOD (THE "INITIAL VALUE").
FOR EACH AWARD
PERIOD, THE VALUE OF EACH PERFORMANCE UNIT SHALL BE COMPOUNDED FORWARD FROM ITS
INITIAL VALUE THROUGH THE END OF THE AWARD PERIOD BASED ON THE WEIGHTED AVERAGE
UNDERWRITING RETURN ON DEPLOYED CAPITAL ("UROC") PRODUCED BY THE COMPANY DURING
THE AWARD PERIOD (THE "PAYMENT VALUE").
FOR EACH AWARD PERIOD THE PERCENTAGE OF
PERFORMANCE UNITS PAID (THE "PAYMENT PERCENTAGE") AT THE END OF THE AWARD PERIOD
MAY VARY BETWEEN 0% AND 200% OF THE INITIALLY AWARDED PERFORMANCE UNITS BASED
UPON THE ACTUAL ANNUAL COMPOUNDED UROC ACHIEVED BY THE COMPANY AND/OR ONE OR
MORE AFFILIATES OF THE COMPANY DURING THE AWARD PERIOD AS COMPARED TO MINIMUM,
TARGET AND MAXIMUM UROC GOALS ESTABLISHED AS OF THE DATE SUCH PERFORMANCE UNITS
WERE AWARDED.
THE PAYMENT PERCENTAGE SHALL BE (I) 0% IF ACTUAL UROC IS LESS
THAN OR EQUAL TO THE MINIMUM GOAL, (II) 100% IF ACTUAL UROC IS EQUAL TO TARGET,
(III) 200% IF ACTUAL UROC IS EQUAL TO OR GREATER THAN THE MAXIMUM GOAL AND
(IV) DETERMINED BY LINEAR INTERPOLATION FOR ACTUAL UROC RESULTS BETWEEN MINIMUM
AND TARGET OR FOR ACTUAL UROC RESULTS BETWEEN TARGET AND MAXIMUM.
(D)
FOR EACH AWARD PERIOD, THE AMOUNT PAYABLE TO
A PARTICIPANT WHO IS QUALIFIED TO RECEIVE SUCH PAYMENT AT THE END OF THE AWARD
PERIOD SHALL BE EQUAL TO THE PRODUCT
2
OF (I) THE NUMBER OF PERFORMANCE UNITS AWARDED TO THE PARTICIPANT FOR THE AWARD
PERIOD, (II) THE PAYMENT VALUE AND (III) THE PAYMENT PERCENTAGE.
(E)
EXCEPT AS OTHERWISE DETERMINED BY THE
COMMITTEE, PERFORMANCE UNITS SHALL BE CANCELLED IF THE PARTICIPANT'S CONTINUOUS
EMPLOYMENT WITH THE COMPANY OR CERTAIN OF ITS AFFILIATES SHALL TERMINATE FOR ANY
REASON PRIOR TO THE END OF THE AWARD PERIOD, EXCEPT SOLELY BY REASON OF A PERIOD
OF RELATED EMPLOYMENT AS DEFINED IN SECTION 8.
NOTWITHSTANDING THE FOREGOING, IF PRIOR TO THE END OF AN AWARD PERIOD A
PARTICIPANT WHILE IN SUCH EMPLOYMENT SHALL (I) RETIRE AT AGE 65 OR OLDER WITH
NOT LESS THAN FIVE (5) YEARS OF SERVICE, (II) DIE OR (III) BECOME DISABLED AS
DESCRIBED IN SECTION