Document:

EXHIBIT 4.1

 

Exhibit 4.1

CERTIFICATE OF DESIGNATIONS

OF

PERPETUAL CUMULATIVE PREFERRED STOCK

OF

SBC COMMUNICATIONS INC.

               SBC COMMUNICATIONS INC., a Delaware corporation (the “Corporation”), does hereby
certify:

               That the following resolution was duly adopted by the Board of Directors of the Corporation
(the “Board of Directors”) at a meeting duly convened and held on November 18, 2005 pursuant to
authority conferred upon the Board of Directors by the provisions of the Restated Certificate of
Incorporation of the Corporation authorizing the Corporation to issue up to 10,000,000 preferred
shares, par value $1 per share:

               “Be it Resolved, that the issuance of a series of preferred shares of SBC
Communications Inc. (the “Corporation”) be, and hereby is, authorized, and the designation, powers,
preferences and rights and the qualifications, limitations and restrictions of such series, in
addition to those set forth in the Restated Certificate of Incorporation of the Corporation (the
“Certificate of Incorporation”) be, and hereby are, fixed as follows:

               SECTION 1. Designation. The distinctive serial designation of such series is “Perpetual
Cumulative Preferred Stock”. Each share of Perpetual Cumulative Preferred Stock shall be identical
in all respects to every other share of Perpetual Cumulative Preferred Stock.

               SECTION 2. Number of Shares. The number of shares of Perpetual Cumulative Preferred Stock
shall be 768,392. Subject to the provisions of Section 6(d) of this Certificate of Designations,
such number may from time to time be increased (but not in excess of the total number of authorized
preferred shares) or decreased (but not below the number of shares of Perpetual Cumulative
Preferred Stock then outstanding) by the Board of Directors of the Corporation (the “Board of
Directors”). Shares of Perpetual Cumulative Preferred Stock that are redeemed, purchased or
otherwise acquired by the Corporation shall be cancelled and shall revert to authorized but
unissued preferred shares undesignated as to series.

               SECTION 3. Rank. The shares of Perpetual Cumulative Preferred Stock shall rank, with respect
to the payment of dividends and in the distribution of assets on any liquidation, dissolution or
winding up of the Corporation, prior to the common shares

 

 

of the Corporation and junior to all series of any other class of preferred shares of the
Corporation.

               SECTION 4. Dividends and Distributions.

               (a) Rate.

               (i) Subject to the rights of the holders of any series of preferred shares (or any
similar stock) ranking prior to the Perpetual Cumulative Preferred Stock with respect to
dividends, the holders of shares of Perpetual Cumulative Preferred Stock, in preference to
the holders of common shares, shall be entitled to receive, when, as and if declared by the
Board of Directors out of funds legally available for the purpose, quarterly dividends
payable in cash on the first day of March, June, September and December in each year (each
such date being referred to herein as a “Quarterly Dividend Payment Date”), commencing on
the first Quarterly Dividend Payment Date after the first issuance of a share or fraction
of a share of Perpetual Cumulative Preferred Stock, in an amount per share (rounded to the
nearest cent) equal to the greater of:

               (1) $1; and

               (2) subject to the provision for adjustment set forth in Section 4(a)(ii)
below, (x) 155.8840 times the aggregate per share amount of all cash dividends and
(y) 155.8840 times the aggregate per share amount (payable in kind) of all non-cash
dividends or other distributions declared on the common shares since the
immediately preceding Quarterly Dividend Payment Date or, with respect to the first
Quarterly Dividend Payment Date, since the first issuance of any share or fraction
of a share of Perpetual Cumulative Preferred Stock, provided,
however, that in lieu of any dividends payable in common shares or payable
as a result of a subdivision of the outstanding common shares (by reclassification
or otherwise), the adjustments set forth in Section 4(a)(ii) below shall be made.

               (ii) In the event the Corporation shall at any time declare or pay any dividend on the
common shares payable in common shares, or effect a subdivision or combination or
consolidation of the outstanding common shares (by reclassification or otherwise than by
payment of a dividend in common shares) into a greater or lesser number of common shares,
then in each such case the amount to which holders of shares of Perpetual Cumulative
Preferred Stock were entitled immediately prior to such event under Section 4(a)(i)(2)
above shall be adjusted by multiplying such amount by a fraction, the numerator of which is
the number of common shares outstanding immediately after such event and the denominator of
which is the number of common shares that were outstanding immediately prior to such event.

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               (b) The Corporation shall declare a dividend or distribution on the Perpetual Cumulative
Preferred Stock as provided in Section 4(a)(i) above immediately after it declares a dividend or
distribution on the common shares (other than a dividend payable in common shares);
provided that, in the event no dividend or distribution shall have been declared on the
common shares during the period between any Quarterly Dividend Payment Date and the next subsequent
Quarterly Dividend Payment Date, a dividend of $1 per share on the Perpetual Cumulative Preferred
Stock shall nevertheless be payable on such subsequent Quarterly Dividend Payment Date.

               (c) Dividends shall begin to accrue and be cumulative on outstanding shares of Perpetual
Cumulative Preferred Stock from the date of issue of such shares. Accrued but unpaid dividends
shall not bear interest. Dividends paid on the shares of Perpetual Cumulative Preferred Stock in
an amount less than the total amount of such dividends at the time accrued and payable on such
shares shall be allocated pro rata on a share-by-share basis among all such shares at the time
outstanding. The Board of Directors may fix a record date for the determination of holders of
shares of Perpetual Cumulative Preferred Stock entitled to receive payment of a dividend or
distribution declared thereon, which record date shall be not more than sixty days nor less than
ten days prior to the date fixed for the payment thereof. In the event that a corresponding
dividend or distribution is being paid on the common shares, the record date shall be the same date
as that fixed for the determination of holders of common shares entitled to receive payment of the
corresponding dividend or distribution.

               (d) Whenever quarterly dividends or other dividends or distributions payable on Perpetual
Cumulative Preferred Stock provided in Section 4(a) above are in arrears (which for the avoidance
of doubt shall not include any failure to make any payment as a result of a waiver by the holders
thereof), thereafter and until all accrued and unpaid dividends and distributions, whether or not
declared, on shares of Perpetual Cumulative Preferred Stock outstanding shall have been paid in
full, the Corporation shall not:

               (i) declare or pay dividends, or make any other distributions, on any shares of stock
ranking junior (either as to the payment of dividends or in the distribution of assets on
any liquidation, dissolution or winding up) to the Perpetual Cumulative Preferred Stock;

               (ii) declare or pay dividends, or make any other distributions, on any shares of stock
ranking on a parity (either as to the payment of dividends or in the distribution of assets
on any liquidation, dissolution or winding up) with the Perpetual Cumulative Preferred
Stock, except dividends paid ratably on the Perpetual Cumulative Preferred Stock and all
such parity stock on which dividends are payable or in arrears in proportion to the total
amounts to which the holders of all such shares are then entitled;

               (iii) redeem or purchase or otherwise acquire for consideration shares of any stock
ranking junior (either as to the payment of dividends or in the

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distribution of assets on any liquidation, dissolution or winding up) to the Perpetual
Cumulative Preferred Stock, provided that the Corporation may at any time redeem,
purchase or otherwise acquire shares of any such junior stock in exchange for shares of any
stock of the Corporation ranking junior (either as to the payment of dividends or in the
distribution of assets on any liquidation, dissolution or winding up) to the Perpetual
Cumulative Preferred Stock; or

               (iv) redeem or purchase or otherwise acquire for consideration any shares of Perpetual
Cumulative Preferred Stock, or any shares of stock ranking on a parity (either as to the
payment of dividends or in the distribution of assets on any liquidation, dissolution or
winding up) with the Perpetual Cumulative Preferred Stock, except in accordance with a
purchase offer made in writing or by publication (as determined by the Board of Directors)
to all holders of such shares upon such terms as the Board of Directors, after
consideration of the respective annual dividend rates and other relative rights and
preferences of the respective series and classes, shall determine in good faith will result
in fair and equitable treatment among the respective series or classes.

               (e) The Corporation shall not permit any subsidiary of the Corporation to purchase or
otherwise acquire for consideration any shares of stock of the Corporation unless the Corporation
could, under Section 4(d) above, purchase or otherwise acquire such shares at such time and in such
manner.

               SECTION 5. Liquidation, Dissolution or Winding Up.

               (a) Subject to the provisions of the Certificate of Incorporation (including any limitations
on distributions to preferred shares), upon the distribution of assets on any liquidation,
dissolution or winding up of the Corporation, no distribution shall be made (i) to the holders of
shares of stock ranking junior (either as to the payment of dividends or in the distribution of
assets on any liquidation, dissolution or winding up) to the Perpetual Cumulative Preferred Stock
unless, prior thereto, the holders of shares of Perpetual Cumulative Preferred Stock shall have
received $1,000 per share, plus an amount equal to accrued and unpaid dividends and distributions
thereon, whether or not declared, to the date of such payment, provided that the holders of
shares of Perpetual Cumulative Preferred Stock shall be entitled to receive an aggregate amount per
share, subject to the provision for adjustment hereinafter set forth, equal to 155.8840 times the
aggregate amount to be distributed per share to holders of common shares, provided,
further, that in the distribution of assets on any involuntary liquidation, dissolution or
winding up of the Corporation, the aggregate amount that all shares of Perpetual Cumulative
Preferred Stock shall be entitled to receive (prior to shares of stock ranking junior to such
shares) shall be no greater than $500,000,000, with holders of shares of Perpetual Cumulative
Preferred Stock entitled to any shortfall or any amount otherwise payable on a pro rata basis with
holders of common shares or (ii) to the holders of shares of stock ranking on a parity (either as
to the payment of dividends or in the distribution of assets on any liquidation, dissolution or
winding up) with Perpetual Cumulative Preferred

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Stock, except distributions made ratably on Perpetual Cumulative Preferred Stock and all such
parity stock in proportion to the total amounts to which the holders of all such shares are
entitled upon the distribution of assets on such liquidation, dissolution or winding up. In the
event the Corporation shall at any time declare or pay any dividend on the common shares payable in
common shares, or effect a subdivision or combination or consolidation of the outstanding common
shares (by reclassification or otherwise than by payment of a dividend in common shares) into a
greater or lesser number of common shares, then in each such case the aggregate amount to which
holders of shares of Perpetual Cumulative Preferred Stock were entitled immediately prior to such
event under the first proviso in Section 5(a)(i) above shall be adjusted by multiplying such amount
by a fraction, the numerator of which is the number of common shares outstanding immediately after
such event and the denominator of which is the number of common shares that were outstanding
immediately prior to such event.

               (b) For purposes of this Section 5, the merger or consolidation of the Corporation with any
other corporation, including a merger in which the holders of common shares receive other stock or
securities, cash and/or any other property for their shares, or the sale of all or substantially
all of the assets of the Corporation (any such transaction, a “Business Combination”), shall not
constitute a liquidation, dissolution or winding up of the Corporation. In case the Corporation
shall execute an agreement providing for the Corporation to enter into a Business Combination, such
agreement shall make provision for the treatment of the shares of Perpetual Cumulative Preferred
Stock in such Business Combination, which treatment shall, in the judgment of the Board of
Directors, (i) preserve the value of any outstanding shares of Perpetual Cumulative Preferred Stock
that will remain outstanding following such Business Combination and/or (ii) provide for the
exchange of each outstanding share of Perpetual Cumulative Preferred Stock for consideration that
has an aggregate value equal to the value of such share of Perpetual Cumulative Preferred Stock.

               SECTION 6. Voting Rights.

               The holders of shares of Perpetual Cumulative Preferred Stock shall have the following voting
rights:

               (a) Subject to the provision for adjustment hereinafter set forth, each share of Perpetual
Cumulative Preferred Stock shall entitle the holder thereof to 15.5884 votes on all matters
submitted to a vote of the stockholders of the Corporation. In the event the Corporation shall at
any time declare or pay any dividend on the common shares payable in common shares, or effect a
subdivision or combination or consolidation of the outstanding common shares (by reclassification
or otherwise than by payment of a dividend in common shares) into a greater or lesser number of
common shares, then in each such case the number of votes per share to which holders of shares of
Perpetual Cumulative Preferred Stock were entitled immediately prior to such event shall be
adjusted by multiplying such number by a fraction, the numerator of which is the number of common
shares outstanding immediately after such event and the denominator of

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which is the number of common shares that were outstanding immediately prior to such event.

               (b) Except as otherwise provided herein, in any other certificate of designations creating a
series of preferred shares or any similar stock, or by law, the holders of shares of Perpetual
Cumulative Preferred Stock and the holders of common shares and any other capital stock of the
Corporation having general voting rights shall vote together as a single class on all matters on
which holders of common shares are entitled to vote.

               (c) If and whenever dividends payable on the Perpetual Cumulative Preferred Stock and any
other class or series of stock of the Corporation ranking on a parity with the Perpetual Cumulative
Preferred Stock as to payment of dividends (any such class or series being referred to herein as
“dividend parity stock”) shall be in arrears (which for the avoidance of doubt shall not include
any failure to make any payment as a result of a waiver by the holders thereof) in an aggregate
amount equal to at least six quarterly dividends (whether or not consecutive), the number of
directors then constituting the Board of Directors shall be increased by two and the holders of
shares of Perpetual Cumulative Preferred Stock, together with the holders of all other affected
classes and series of dividend parity stock similarly entitled to vote for the election of two
additional directors, voting together as a single class, shall be entitled to elect the two
additional directors at any annual meeting of stockholders or any special meeting of the holders of
shares of Perpetual Cumulative Preferred Stock and such dividend parity stock called as hereinafter
provided. Whenever all arrears in dividends on the Perpetual Cumulative Preferred Stock and
dividend parity stock then outstanding shall have been paid in full and dividends thereon for the
current quarterly dividend period shall have been paid or declared and set aside for payment, then
the right of the holders of shares of Perpetual Cumulative Preferred Stock and such dividend parity
stock to elect such additional two directors shall cease (but subject always to the same provisions
for the vesting of such voting rights in the case of any similar future arrearages in dividends),
and the terms of office of all persons elected as directors by the holders of shares of Perpetual
Cumulative Preferred Stock and such dividend parity stock shall forthwith terminate and the number
of directors constituting the Board of Directors shall be reduced accordingly. At any time after
such power shall have been so vested in the holders of shares of Perpetual Cumulative Preferred
Stock and such dividend parity stock, the Secretary of the Corporation may, and upon the written
request of any holder of shares of Perpetual Cumulative Preferred Stock (addressed to the Secretary
at the principal office of the Corporation) shall, call a special meeting of the holders of shares
of Perpetual Cumulative Preferred Stock and such dividend parity stock for the election of the two
directors to be elected by them as herein provided, such call to be made by notice similar to that
provided in the by-laws of the Corporation for a special meeting of the stockholders or as required
by law. If any such special meeting so required to be called shall not be called by the Secretary
within 20 days after receipt of any such request, then any holder of shares of Perpetual Cumulative
Preferred Stock may (at the Corporation’s expense) call such meeting, upon notice as herein
provided, and for that

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purpose shall have access to the stock books of the Corporation. The directors elected at any
such special meeting shall hold office until the next annual meeting of the stockholders if such
office shall not have previously terminated as above provided. In case any vacancy shall occur
among the directors elected by the holders of shares of Perpetual Cumulative Preferred Stock and
such dividend parity stock, a successor shall be elected by the Board of Directors to serve until
the next annual meeting of the stockholders upon the nomination of the then remaining director
elected by the holders of shares of Perpetual Cumulative Preferred Stock and such dividend parity
stock or the successor of such remaining director. If the holders of shares of Perpetual
Cumulative Preferred Stock become entitled under the foregoing provisions to elect or participate
in the election of two directors as a result of dividend arrearages, such entitlement shall not
affect the right of such holders to vote as stated in Sections 6(a)-(b) above, including the right
to vote in the election of the remaining directors.

               (d) So long as any shares of Perpetual Cumulative Preferred Stock are outstanding, in addition
to any other vote or consent of stockholders required by law or by the Certificate of
Incorporation, the vote or consent of the holders of at least 66 2/3% of the shares of Perpetual
Cumulative Preferred Stock at the time outstanding, voting separately as a single class, given in
person or by proxy, either in writing without a meeting or by vote at any meeting called for the
purpose, shall be necessary for effecting or validating:

               (i) any amendment, alteration or repeal of any provision of the Certificate of
Incorporation, by-laws of the Corporation or this Certificate of Designations that would
alter or change the powers, preferences or special rights of the Perpetual Cumulative
Preferred Stock so as to affect them adversely; provided, however, that an
amendment of the Certificate of Incorporation so as to authorize or create, or to increase
the authorized amount of, any shares of any class or series or any securities convertible
into shares of any class or series of capital stock of the Corporation ranking junior to or
on a parity with the Perpetual Cumulative Preferred Stock with respect to the payment of
dividends and in the distribution of assets on any liquidation, dissolution or winding up
of the Corporation shall not be deemed to affect adversely the powers, preferences or
special rights of the Perpetual Cumulative Preferred Stock; or

               (ii) any amendment or alteration of the Certificate of Incorporation to authorize or
create, or increase the authorized amount of, any shares of any class or series or any
securities convertible into shares of any class or series of capital stock of the
Corporation ranking prior to the Perpetual Cumulative Preferred Stock with respect to the
payment of dividends or in the distribution of assets on any liquidation, dissolution or
winding up of the Corporation;

provided, however, that if any such amendment, alteration or repeal would affect
adversely the powers, preferences or special rights of the Perpetual Cumulative Preferred

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Stock and any other series of preferred shares similarly entitled to vote upon the matters
specified herein in substantially the same manner, it shall be sufficient if the holders of shares
of Perpetual Cumulative Preferred Stock and all such other series so adversely affected vote
thereon together as a single class, regardless of series.

               (e) So long as any shares of Perpetual Cumulative Preferred Stock are outstanding, in addition
to any other vote or consent of stockholders required by law or by the Certificate of
Incorporation, the vote or consent of the holders of at least a majority of the shares of Perpetual
Cumulative Preferred Stock and all other series of preferred shares similarly entitled to vote upon
the matters specified in this Section 6(e) at the time outstanding, voting together as a single
class regardless of series, given in person or by proxy, either in writing without a meeting or by
vote at any meeting called for the purpose, shall be necessary for effecting or validating any
amendment or alteration of the Certificate of Incorporation to increase the authorized number of
shares of Perpetual Cumulative Preferred Stock, or to authorize or create, or increase the
authorized amount of, any shares of any class or series or any securities convertible into shares
of any class or series of capital stock of the Corporation ranking on a parity with the Perpetual
Cumulative Preferred Stock with respect to the payment of dividends or in the distribution of
assets on any liquidation, dissolution or winding up of the Corporation; provided,
however, that no such vote or consent of the holders of shares of Perpetual Cumulative
Preferred Stock shall be required if provision is made for the redemption of all shares of
Perpetual Cumulative Preferred Stock at the time outstanding at or (with the consent of the holders
of such shares) before the time such increase, authorization or creation is to be made.

               SECTION 7. Redemption.

               (a) At any time, the Board of Directors may redeem shares of the Perpetual Cumulative
Preferred Stock for common shares of the Corporation at a ratio of 155.8840 common shares per share
of Perpetual Cumulative Preferred Stock. In the event the Corporation shall at any time declare or
pay any dividend on the common shares payable in common shares, or effect a subdivision or
combination or consolidation of the outstanding common shares (by reclassification or otherwise
than by payment of a dividend in common shares) into a greater or lesser number of common shares,
then in each such case the number of common shares set forth in the preceding sentence with respect
to the redemption of shares of Perpetual Cumulative Preferred Stock shall be adjusted by
multiplying such amount by a fraction, the numerator of which is the number of common shares
outstanding immediately after such event and the denominator of which is the number of common
shares that were outstanding immediately prior to such event.

               (b) Any redemption pursuant to this Section 7 shall be pursuant to
notice and other procedures as determined by the Board of Directors.

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               SECTION 8. Other Rights. The shares of Perpetual Cumulative Preferred Stock shall not have
any powers, preferences or relative, participating, optional or other special rights, or
qualifications, limitations or restrictions thereof, other than as set forth herein or in the
Certificate of Incorporation.

               SECTION 9. Restatement of Certificate. Upon any restatement of the Certificate of
Incorporation, this Certificate of Designations shall be attached as Exhibit A to the Certificate
of Incorporation and the following sentence shall be added to ARTICLE FIVE of the restated
Certificate of Incorporation: “The Board of Directors has designated a series of its Perpetual
Cumulative Preferred Stock pursuant to a Certificate of Designations duly filed with the Secretary
of State of the State of Delaware on November 18, 2005, a copy of which is attached hereto as
Exhibit A, and incorporated herein by reference.” This Section 9 may be omitted from such restated
Certificate of Incorporation.

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               In Witness Whereof, SBC Communications Inc. has caused this certificate to be signed
by Joy Rick, its Vice President and Secretary, this 18th day of November, 2005.

	 	 	 	 	 
	 	 	SBC COMMUNICATIONS INC.
	 
	 	 	 	 
	 

	 	By
	 	/s/Joy Rick
	 

	 	 	 	 
	 

	 	 	 	Joy Rick

Vice President and Secretary

10EX-10.1

 

Exhibit 10.1

MONTPELIER RE HOLDINGS LTD.

LONG-TERM INCENTIVE PLAN

PERFORMANCE SHARE AND RESTRICTED SHARE UNIT

AWARD AGREEMENT

     This Award Agreement (the “Award Agreement”) is made and entered into as of January 1st, 2006
between Montpelier Re Holdings Ltd. (the “Company”) and                                          (the “Participant”).

     The Company hereby grants to the Participant Performance Shares and Restricted Share Units
(the “Award”) on the terms and conditions as set forth in this Award Agreement and in the
Montpelier Long-Term Incentive Plan (the “Plan”).

     In accordance with this grant, and as a condition thereto, the Company and the Participant
agree as follows:

     SECTION
1. Performance Share Target Award; Performance Period; Date of Grant:

	 	 	 
	Target Award:

	 	                     Performance Shares (the “Target Award”)
	 
	 	 
	Performance Period:

	 	January 1, 2006 through and ending on December 31, 2008
(the “Performance Period”)
	 
	 	 
	Date of Grant:

	 	January 1, 2006

     SECTION
2. Nature of Award. The Target Award represents the opportunity to receive a future
payment equal to the fair market value of such number of shares of Company common shares, $0.001666
par value per share (“Shares”), as are earned in accordance with Section 3 of this Award Agreement
as more fully set forth in Section 4 of this Award Agreement.

     SECTION
3. Determination of Number of Shares Earned. The number of Performance Shares
earned as of the end of a Performance Period, if any, shall be determined as follows:

 

 

# of Shares = Payout Percentage x Target Award

The “Payout Percentage” shall be determined by the Committee in its sole discretion based on the
Performance Criteria and Harvest Scale set out in Appendix 1 hereto

     SECTION
4. Payment of Performance Shares. The amount payable to a Participant in settlement
of the Performance Shares shall be equal to the fair market value (to be issued fully paid in
consideration of the Participant’s services to the Company) of a Share, as determined by the
Committee by reference to the average of the daily closing price of the Company’s common shares on
the New York Stock Exchange, as reported in the Wall Street Journal, for each of the five
consecutive trading days preceding and including, as the last day, December 31, 2007 multiplied by
the number of Performance Shares earned with respect to the Performance Period, as determined
pursuant to Section 3 of this Award Agreement. Payment in respect of an Award shall be made in
cash, in Shares of equivalent value or in some combination thereof, as determined by the Committee
in its sole discretion. Subject to Section 6 of this Award Agreement, payment shall be made as
soon as reasonably practicable following the close of the Performance Period and the Committee’s
determination of the Payout Percentage.

     SECTION 5. Restricted Share Unit Award; Vesting; Date of Grant

	 	 	 
	Award:

	 	                     Restricted Share Units (the “RSU Award”)
	 
	 	 
	Vesting Period:

	 	December 31, 2006 through and ending on December 31, 2008
	 
	 	 
	Date of Grant:

	 	January 1, 2006

     SECTION
6. Nature of Award. The RSU Award represents the opportunity to receive shares of
Company common shares, $[0.001666] par value per share (“RSU Shares”), as are earned in accordance
with Section 7 of this Award Agreement.

     SECTION 7. Vesting. Subject to the Participant remaining employed at the applicable Vesting
Date, as hereinafter defined, the RSU Award shall vest over the vesting period described in Section
5 above in three equal tranches of Restricted Share Units (each a “Tranche”) at midnight on
December 31st 2006, December 31st 2007 and December 31st 2008,
respectively (each a “Vesting Date”). Shares shall be issued by the Company to the Participant in
satisfaction of

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the RSU Award as soon as reasonably practicable following the end of the vesting
period described in Section 5 above.

     SECTION 8. [Reserved]

     SECTION
9. Termination of Employment

     (a) Unless otherwise determined by the Committee at the time of termination, if the
Participant’s employment with the Company or one of its
subsidiaries is terminated by the Company or the subsidiary for any reason other than Cause
(as defined in Section 8 of the Plan), death or disability(as determined in accordance with Section
8 of the Plan), or is terminated by the Participant on account of a Constructive Termination (as
defined in Section 8 of the Plan) or Retirement (as defined below): (i) during the first year of
the Performance Period, all Performance Shares shall be forfeited; (ii) during the second year of
the Performance Period, the determination of the Payout Percentage for the Performance Period will
be made by the Committee at the end of the Performance Period, and Performance Shares earned, if
any, will be paid based on the Payout Percentage, prorated for the number of full months elapsed
from and including the month in which the Performance Period began to and including the month in
which the termination of employment occurs; (iii) during the third year of the Performance Period,
the determination of the Payout Percentage for the Performance Period will be made by the Committee
at the end of the Performance Period, and Performance Shares earned, if any, will be paid based on
the Payout Percentage without prorating, and (iv) without regard to the year of the Performance
Period, all Restricted Share Units unvested at the date of termination shall be forfeited, and any
vested Restricted Share Units shall be settled in accordance with the provisions of Section 7 as
soon as reasonably practicable following the end of the vesting period described in Section 5.

     For purposes of this Award Agreement, “Retirement” means a termination of the Participant’s
employment or service constituting retirement under an approved retirement program of the Company
(or such other plan as may be approved by the Committee).

     (b) Unless otherwise determined by the Committee at the time of termination, if the
Participant’s employment is terminated by the Company or one of its subsidiaries for Cause or by
the Participant not on account of a Constructive Termination, Retirement, death or disability (as
determined in accordance with Section 8 of the Plan) during the Performance Period, then:

     (i) all Performance Shares shall be forfeited; and,

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     (ii) all unvested Restricted Share Units shall be forfeited and, unless terminated
for Cause, any vested Restricted Share Units shall be settled in accordance with the
provisions of Section 7 as soon as reasonably practicable following the end of the vesting
period described in Section 5.

     (c) For purposes of the Plan and the Award Agreement, a transfer of employment from the
Company to any subsidiary of the Company or vice versa, or from one subsidiary to another, shall
not be considered a termination of employment.

     SECTION 10. Change in Control. Notwithstanding the provisions of Section [ ] above, if
within twenty four months following the occurrence of a Change in Control (as defined in the Plan),
the employment of the Participant with the Company or one of its subsidiaries is terminated by the
Company or the subsidiary for any reason other than for Cause, death or disability (as determined
in accordance with Section [ ] of the Plan) or is terminated by the Participant on account of a
Constructive Termination, upon such termination:

     (a) the Target Award shall be deemed to have been earned with respect to the full Performance
Period and payment with respect to the Performance Shares shall be made to the Participant in cash
as soon as reasonably practicable after such termination; and,

     (b) the Restricted Share Units shall be deemed to have vested in full and Shares with
respect to the RSU Award shall be issued to the Participant by the Company as soon as
reasonably practicable after such termination.

     SECTION
11. Tax Withholding. Pursuant to paragraph 17(c) of the Plan, the Committee shall
have the power and the right to deduct or withhold, or require the Participant to remit to the
Company, an amount sufficient to satisfy any federal, state, local or other taxes required by
applicable law to be withheld with respect to payment of the Award. The Committee may condition
the payment hereunder upon the Participant’s satisfaction of such withholding obligations.

     SECTION
12. Rights As A Shareholder. The Participant shall have no rights as shareholder
with respect to any Shares underlying the Award until and unless the Participant’s name is entered
in the Company’s Register of Members as the holder of such shares and a Share certificate is issued
to the Participant upon payment with respect to the Award.

     SECTION 13. Dividend Equivalents. The Participant shall be entitled to receive dividend
equivalents with respect to Shares underlying the Award.

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     SECTION
14. Transferability. Pursuant to paragraph 14 of the Plan the Participant may
designate a beneficiary or beneficiaries to receive any payment to which he or she may be entitled
in respect of Awards under the Plan in the event of his or her death on a form to be provided by
the Committee; Except as provided herein, the Participant may not sell, transfer, pledge, assign or
otherwise alienate or hypothecate the Performance Shares, other than by his or her last Will and
Testament or by the laws of descent and distribution.

     SECTION 15. Ratification of Actions. By accepting the Award or other benefit under the
Plan, the Participant and each person claiming under or through him or her shall be conclusively
deemed to have indicated the Participant’s acceptance and ratification of, and consent to, any
action taken under the Plan or
the Award by the Company, the Board or the Committee. All decisions or interpretations of the
Company, the Board and the Committee upon any questions arising under the Plan and/or this Award
Agreement shall be binding, conclusive and final on all parties. In the event of any conflict
between any provision of the Plan and this Award Agreement, the terms and provisions of the Plan
shall control.

     SECTION 16. Notices. Any notice hereunder to the Company shall be addressed to its office,
Mintflower Place, 8 Par-La-Ville Road, Hamilton HM08, Bermuda; Attention: Corporate Secretary, and
any notice hereunder to the Participant shall be addressed to him or her at the address specified
on the Award Agreement, subject to the right of either party to designate at any time hereafter in
writing some other address.

     SECTION 17. Definitions. Capitalized terms not otherwise defined herein shall have the
meanings given them in the Plan.

     SECTION 18. Governing Law and Severability. This Award Agreement will be governed by and
construed in accordance with the laws of Bermuda, without regard to conflicts of law provisions. In
the event any provision of the Award Agreement shall be held illegal or invalid for any reason, the
illegality or invalidity shall not affect the remaining parts of the Award Agreement, and the Award
Agreement shall be construed and enforced as if the illegal or invalid provision had not been
included.

     SECTION 19. No Rights to Continued Employment. This Award Agreement is not a contract of
employment. Nothing in the Plan or in this Award Agreement shall interfere with or limit in any
way the right of the Company or any subsidiary to terminate the Participant’s employment at any
time, for any reason or no reason, or confer upon the Participant the right to continue in the
employ of the Company or a subsidiary.

     SECTION 20. Counterparts. This Award Agreement may be signed in any number of counterparts,
each of which shall be an original, with the same effect as if the signatures thereto and hereto
were upon the same instrument.

5

 

     IN WITNESS WHEREOF, the undersigned have caused this Award Agreement to be duly executed as of
the date first written above.

	 	 	 	 	 
	 	 	MONTPELIER RE HOLDINGS LTD.
	 
	 	 	 	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 

	 	 	 	Name:
	 

	 	 	 	Title:
	 
	 	 	 	 
	 

	 	PARTICIPANT
	 	 
	 
	 	 	 	 
	 

	 	By:	 	 
	 

	 	 	 	 
	 

	 	 	 	Name:
	 

	 	 	 	Title:

6

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