Document:

Exhibit
10.2

EMPLOYMENT AGREEMENT

THIS AGREEMENT (the “Agreement”),
dated as of April 4, 2006, is by and between CastlePoint Holdings, Ltd., a Bermuda
exempted company (the “Company”), and Joel Weiner (the “Executive”).

WITNESSETH THAT

WHEREAS, the Company is a
newly formed Bermuda exempted company that proposes to make a private placement
of the Company’s securities with net proceeds to the Company of at least $100
million (the “Offering”); and

WHEREAS, the Executive is
presently employed by Tower Group, Inc. or one of its affiliates (“Tower”) and
will cease to be employed by Tower as of the effective date of the Offering;
and

WHEREAS, the Executive and
the Company wish to enter into a written agreement setting forth the terms and
conditions of the Executive’s employment with the Company following completion
of the Offering; and

WHEREAS, this Agreement is
the entire agreement between the parties concerning the subject matter hereof
and supersedes all prior agreements concerning the same subject.

NOW, THEREFORE, in
consideration of the premises and the mutual covenants contained herein, the
Company and the Executive hereby agree as follows:

1.             Term.

(a)           Term of Employment.

(i)            The Company shall employ the
Executive, and the Executive shall serve the Company, on the terms and subject
to the conditions set forth in this Agreement, commencing on the date of the
closing of the Offering (the “Effective Date”) and, unless sooner terminated
pursuant to section 4, continuing until the date that is the one-year anniversary
of the Effective Date or such later date as provided in subsection 1(a)(ii)
below (the “Term of Employment”).

(ii)            The Term of Employment shall be
extended automatically for one additional year on the last day before the first
anniversary of the Effective Date and for one additional year on each
anniversary thereafter unless and until either party gives written notice to
the other not to extend this Agreement at least three months before such
extension would be effectuated.

(b)           Term of the Agreement.  This Agreement shall become effective on the
Effective Date and shall continue in effect throughout the Term of Employment;
provided, however, the restrictive covenants contained in section 10 of this
Agreement and, as applicable, 

 

 

the Company’s and the Executive’s obligations under
the other provisions of this Agreement shall survive the Term of Employment and
shall continue in effect through the periods provided therein and/or until the
Company’s and/or the Executive’s obligations, as applicable, thereunder are
satisfied.

2.             Position and Duties.

(a)           Positions, Duties, and
Responsibilities.  The Executive
shall serve as Senior Vice President and Chief Financial Officer of the Company
and/or in such other positions as the Chief Executive Officer of the Company
(the “CEO”), the Board of Directors of the Company (the “Board”) or a committee
of the Board may from time to time prescribe, with such duties and
responsibilities as are customarily assigned to such position(s). The Executive
shall report solely to the CEO unless the CEO, the Board or a committee of the
Board determines otherwise. The Executive agrees to serve without additional
compensation in such capacities (including, without limitation, as an employee
or director) with Company and its affiliates as the CEO, the Board or a
committee of the Board may in its discretion prescribe. Upon termination of the
Executive’s employment with the Company, any employment, board membership or
other service relationship with the Company and any Company affiliate shall
automatically terminate unless otherwise determined by the parties hereto.

(b)           Time and Attention. Excluding
any periods of vacation and sick leave to which the Executive is entitled, the
Executive shall devote substantially all of his attention and time during
normal working hours to the business and affairs of the Company and its
affiliates. It shall not be considered a violation of the foregoing, however,
for the Executive to (i) serve on corporate, industry, educational, religious,
civic, or charitable boards or committees or (ii) make and attend to passive
personal investments in such form as will not require any material time or
attention to the operations thereof during normal working time and will not
violate the provisions of section 10 hereof, so long as such activities in
clauses (i) and (ii) do not materially interfere with the performance of the
Executive’s responsibilities as an employee of the Company in accordance with
this Agreement or violate section 10 of this Agreement.

3.             Compensation.  Except as otherwise expressly set forth below,
the Executive’s compensation shall be determined by, and in the sole discretion
of, the Compensation Committee of the Board (the “Committee”).

(a)           Annual Base Salary.  Subject to adjustment pursuant to this
subsection 3(a), the Executive shall receive an annual base salary of Two
Hundred Seventy Five Thousand and Five Hundred-Sixty Eight dollars ($275,568)
during the Term of Employment (the annual base salary in effect from time to
time, “Annual Base Salary”). The Annual Base Salary shall be payable in
accordance with the Company’s regular payroll practices for its senior
officers, as in effect from time to time. The Annual Base Salary shall be
reviewed from time to time, but not less frequently than annually, and, in the
discretion of the Committee, may be adjusted but not decreased below the amount
set forth in the first sentence of this subsection 3(a). To the extent Annual
Base Salary is adjusted, then such adjusted salary shall be the Executive’s
Annual Base Salary for all purposes of this Agreement.

 

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(b)           Annual Bonus.  The Executive shall have an opportunity to
receive annual bonuses during the Term of Employment (the “Annual Bonus”),
subject to such terms and conditions as the Committee shall prescribe. The
Executive’s target Annual Bonus opportunity shall be equal to thirty percent
(30%) of his Annual Base Salary, it being understood that the actual Annual
Bonus received by the Executive will depend on the level of attainment of
performance and other factors used by the Committee to determine Annual Bonus
amounts and that there is no guarantee that an Annual Bonus will be earned. The
Executive’s target Annual Bonus opportunity shall be reviewed from time to
time, but not less frequently than annually, and, in the discretion of the
Committee, may be adjusted but not decreased below the amount set forth in the
second sentence of this subsection 3(b).

(c)           Employee Benefits; Fringe Benefits.
 In addition to the foregoing, during the
Term of Employment,

(i)            As soon as reasonably practicable,
but effective on the Effective Date, the Committee shall grant to the Executive
an option to acquire one hundred twenty eight thousand seven hundred fifty
(128,750) of the Company’s common shares outstanding immediately following the
Company’s Offering of its common shares, at an exercise per share equal to the
offering price per share of the Company’s common shares in the Offering.  The other terms of the stock option shall be
as set forth in the Company’s 2006 Long-Term Equity Compensation Plan and an
option agreement to be entered into thereunder. 
The stock option award provided for in this subsection (i) is made as an
inducement essential to the Executive’s entering into this Agreement.

(ii)           to the extent not duplicative of the
specific benefits provided herein, subject to the following sentence, the
Executive shall be eligible to participate in all incentive compensation,
retirement, supplemental retirement, and deferred compensation plans, policies
and arrangements that are provided generally to other senior officers of the
Company.

(iii)          the Executive and, as applicable, the
Executive’s covered dependents shall be eligible to participate in all of the
Company’s health and welfare benefit plans (within the meaning of Section 3(1)
of the Employee Retirement Income Security Act of 1974, as amended); and

(iv)          the Executive shall be entitled to
receive fringe benefits provided for senior officers of the Company, and shall
be entitled to avail himself of paid holidays, as determined from time to time
by the Company.

(d)           Vacation. The Executive shall
be entitled to not less than 4 weeks of paid vacation per calendar year during
the Term of Employment. Vacation days not used within the year shall be carried
forward to subsequent years, as determined by the Company and subject to such
conditions or restrictions as the Company may prescribe.

(e)           Expenses. The Executive shall
be reimbursed by the Company for reasonable business expenses actually incurred
in rendering to the Company the services provided for hereunder during the Term
of Employment, payable in accordance with customary Company practice, after the
Executive presents written expense statements or such other 

 

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supporting information as
the Company may require of its senior officers for reimbursement of such
expenses.  If the Executive relocates to
Bermuda, the Company will provide to the Executive benefits, including housing
customarily provided to similarly situated senior executives residing in
Bermuda and travel to and from Bermuda for Executive’s immediate family
pursuant to Company policies as in effect from time to time.

4.             Termination of Employment.

(a)           Termination of Employment and Term
of Employment. The Company or the Executive may terminate the Executive’s
employment at any time and for any reason in accordance with subsection 4(b)
below. The Term of Employment shall be deemed to have ended on the last day of
the Executive’s employment. The Term of Employment shall terminate upon the
Executive’s death.

(b)           Notice of Termination. Any
purported termination of the Executive’s employment (other than by reason of
death) shall be communicated by written Notice of Termination from one party
hereto to the other party hereto in accordance with the notice provisions
contained in subsection 15(b) below. For purposes of this Agreement, a “Notice
of Termination” shall mean a notice that indicates the Date of Termination and,
with respect to a termination due to Disability, Cause or Good Reason, sets
forth in reasonable detail the facts and circumstances that are alleged to
provide a basis for such termination. A Notice of Termination from the Company
shall specify whether the termination is with or without Cause or due to the
Executive’s Disability. A Notice of Termination from the Executive shall
specify whether the termination is with or without Good Reason and, if the
termination is without Good Reason, whether the termination is due to his
Disability or retirement. For avoidance of doubt, the Executive shall not be
deemed to have retired for purposes of this Agreement if his employment is
terminated by the Company (whether or not such termination is with or without
Cause or due to the Executive’s Disability), by the Executive with Good Reason,
due to a Disability or due to the Executive’s death.

(c)           Date of Termination. For
purposes of this Agreement, “Date of Termination” shall mean the date specified
in the Notice of Termination (but in no event shall such date be earlier than
the 30th day following the date the Notice of Termination is given, unless
expressly agreed to by the parties hereto) or the date of the Executive’s
death.

(d)           No Waiver. The failure to set
forth any fact or circumstance in a Notice of Termination, which fact or
circumstance was not known to the party giving the Notice of Termination when
the notice was given, shall not constitute a waiver of the right to assert such
fact or circumstance in an attempt to enforce any right under or provision of
this Agreement.

(e)           Cause. For purposes of this
Agreement, the term “Cause” means: (i) the Executive’s gross negligence or
gross misconduct or (ii) the Executive’s having been convicted of, or entered a
plea of nolo contendere to, a crime involving moral turpitude or a felony. No
act or failure to act directly related to Company action or inaction that
constitutes Good Reason shall constitute Cause under this Agreement if the
Executive has provided a Notice of Termination based on such Good Reason event
prior to the Company’s giving of the Notice of Termination for Cause. The
Executive’s termination for Cause shall be effective when and if a resolution
is 

 

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duly adopted by an affirmative vote of the entire
Board (less the Executive if serving on the Board), stating that, in the good
faith opinion of the Board, the Executive is guilty of the conduct described in
the Notice of Termination, and such conduct constitutes Cause under this
Agreement; provided, however, that the Executive shall have been given the
opportunity (i) to cure any act or omission that constitutes Cause if capable
of cure and (ii), together with counsel, during the 30-day period following the
receipt by the Executive of the Notice of Termination and prior to the adoption
of the Board’s resolution, to be heard by the Board.

(f)            Disability. For purposes of
this Agreement, the Executive shall be deemed to have a Disability if the
Executive is entitled to long-term disability benefits under the Company’s
long-term disability plan or policy, as the case may be, as in effect on the
Date of Termination.

(g)           Good Reason. For purposes of
this Agreement, the term “Good Reason” means the occurrence (without the Executive’s
express written consent) of any of the following acts or failures to act by the
Company:

(i)            any reduction in the Executive’s
Annual Base Salary or target Annual Bonus opportunity;

(ii)           requiring the Executive to be based
more than 50 miles away from Bermuda or New York City, New York;

(iii)          the material breach by the Company of
any of its other obligations under this Agreement; or

(iv)          the failure of the Company to obtain
the assumption of this Agreement as contemplated in subsection 13(b) hereof.

The Executive’s continued
employment shall not constitute consent to, or a waiver of rights with respect
to, any act or failure to act constituting Good Reason hereunder; provided,
however, that no such event described above shall constitute Good Reason unless
the Executive has given a Notice of Termination to the Company specifying the
condition or event relied upon for such termination within 90 days from the
Executive’s actual knowledge of the occurrence of such event and, if capable of
cure, the Company has failed to cure the condition or event constituting Good
Reason within the 30 day period following receipt of the Executive’s Notice of
Termination.

5.             Obligations of the Company upon Termination.

(a)           Termination by the Company for
other than Cause or by the Executive for Good Reason.  If the Executive’s employment is terminated by
the Company for any reason other than Cause or Disability or by the Executive
for Good Reason:

(i)            The Company shall pay to the
Executive, within thirty business days of the Date of Termination, any earned
but unpaid Annual Base Salary;

 

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(ii)           The Company shall pay to the
Executive, within thirty business days of the Date of Termination, a prorated
Annual Bonus based on (A) the target Annual Bonus opportunity in the year in
which the Date of Termination occurs or the prior year if no target Annual
Bonus opportunity has yet been determined (disregarding any reduction in target
Annual Bonus opportunity that was the basis for a termination by the Executive
for Good Reason) and (B) the fraction of the year the Executive was employed.

(iii)          The Company shall pay to the
Executive, within thirty business days of the Date of Termination, a lump-sum
payment equal to the sum of 50% (100% if the Executive’s combined service with the
Company and Tower is at least three (3) years as of the Date of Termination) of
(x) the Executive’s Annual Base Salary in effect immediately prior to the Date
of Termination (disregarding any reduction in Annual Base Salary that was the
basis for a termination by the Executive for Good Reason), and (y) the
Executive’s target Annual Bonus opportunity for the year in which the Date of
Termination occurs or the prior year if no target Annual Bonus opportunity has yet
been determined (disregarding any reduction in target Annual Bonus opportunity
that was the basis for a termination by the Executive for Good Reason);

(iv)          For a six (6) month period (one (1)
year period if Executive’s combined service with the Company and Tower is at least
three (3) years as of the Date of Termination) after the Date of Termination,
the Company will arrange to provide the Executive (and any covered dependents),
without cost to the Executive, with life, accident and health insurance benefits
substantially similar to those the Executive and any covered dependents were
receiving immediately prior to the Notice of Termination, except for any such
benefits that were waived by the Executive in writing. If the Company arranges
to provide the Executive and covered dependents with life, accident and health
insurance benefits, those benefits will be reduced to the extent comparable
benefits are actually received by, or made available to, the Executive by a
subsequent employer without cost during the six (6) month or one (1) year
period, as the case may be, following the Executive’s Date of Termination. The
Executive must report to the Company any such benefits that he actually
receives or are made available. In lieu of the benefits described in this
subsection 5(a)(iv), the Company, in its sole discretion, may elect to pay to
the Executive a lump sum cash payment equal to the total premiums that would
have been paid by the Company to provide such benefits to the Executive
(determined based on the premiums paid by the Company immediately prior to the
Date of Termination). Nothing in this subsection 5(a)(iv) will affect the
Executive’s right to elect COBRA continuation coverage in accordance with
applicable law or extend the COBRA continuation coverage period; and

(v)           The Executive shall have at least
three (3) months (or until the last day of the stock option term, whichever
occurs first) to exercise any then vested outstanding stock options.

(b)           Termination in Connection with a
Change in Control.

(i)            If, in anticipation of or within the
24 month period following a Change in Control (as defined below), the Executive’s
employment is terminated by the Company for any reason other than Cause or
Disability or by the Executive for Good Reason, the Executive shall receive the
payments and benefits described in subsection 5(a), and, in addition, 

 

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all of the Executive’s outstanding equity-based awards
shall become fully vested on the Date of Termination.

(ii)           For purposes of this Agreement, the
term “Change in Control” means the occurrence of any of the following events:

A.            any “person” (within the meaning ascribed to such term in
Section 3(a)(9) of the Securities Exchange Act of 1934, as amended from time to
time (the “Exchange Act”) and used in Sections 13(d) and 14(d) thereof,
including a “group” as used in Section 13(d) thereof), other than the Company,
any trustee or other fiduciary holding securities under an employee benefit
plan of the Company, or any corporation owned directly or indirectly by the
stockholders of the Company in substantially the same proportion as the
ownership of stock of the Company, (a “Person”) that is not on the Effective
Date the “beneficial owner” (as defined in Rule 13d-3 under the Exchange Act),
directly or indirectly, of securities of the Company representing more than 35%
of the combined voting power of the Company’s then outstanding securities
becomes after the Effective Date the beneficial owner, directly or indirectly,
of securities of the Company representing more than 35% of the combined voting
power of the Company’s then outstanding securities;

B.            individuals who, as of the Effective Date, constitute the
Board (the “Incumbent Board”) cease for any reason to constitute at least a
majority of the Board of the Company, provided that any person becoming a
director subsequent to the date hereof whose election, or nomination for
election by the Company’s stockholders, was approved by a vote of at least a
majority of the directors then comprising the Incumbent Board (other than an
election or nomination of an individual whose initial assumption of office is
in connection with an actual or threatened election contest relating to the
election of the directors of the Company) shall be, for purposes of this
definition, considered as though such person were a member of the Incumbent
Board;

C.            consummation of a merger, consolidation, reorganization,
share exchange or similar transaction (a “Transaction”) of the Company with any
other entity, other than (I) a Transaction that would result in the voting
securities of the Company outstanding immediately prior thereto directly or
indirectly continuing to represent (either by remaining outstanding or by being
converted into voting securities of the surviving entity or a parent company)
more than 80% of the combined voting power of the voting securities of the
Company or such surviving entity or parent company outstanding immediately
after such Transaction or (II) a Transaction effected to implement a
recapitalization of the Company (or similar transaction) in which no Person
acquires more than 35% of the combined voting power of the Company’s then
outstanding securities;

D.            the sale, transfer or other disposition (in one
transaction or a series of related transactions) of more than 50% of the
operating assets of the Company; or

E.             the approval by the shareholders of a plan or proposal
for the liquidation or dissolution of the Company.

 

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Notwithstanding anything to
the contrary contained in the foregoing definition, the Offering or an initial
public offering of the Company’s shares shall not constitute a Change in
Control for purposes of this Agreement. 
Any transaction with Tower and its affiliates shall not constitute a
Change in Control.

(c)           Termination by the Company for
Cause or by the Executive without Good Reason.  If the Executive’s employment is terminated by
the Company for Cause, the Company shall pay to the Executive, within thirty
business days of the Date of Termination, any earned but unpaid Annual Base
Salary and all outstanding stock options (whether or not then exercisable),
restricted stock and other incentive awards shall be forfeited. If the
Executive’s employment is terminated by the Executive without Good Reason (and
not due to death, Disability or retirement), the Company shall pay to the
Executive, within thirty business days of the Date of Termination, any earned
but unpaid Annual Base Salary, the Executive shall have three months (or until
the last day of the stock option term, whichever occurs first) to exercise any
outstanding vested stock options and all of the Executive’s unvested
equity-based awards shall be forfeited as of the Date of Termination.

(d)           Termination due to Death or
Disability. If the Executive’s employment is terminated due to death or
Disability, (i) the Company shall pay to the Executive (or to the Executive’s
estate or personal representative in the case of the Executive’s death), within
thirty business days after the Date of Termination, (A) any earned but unpaid
Annual Base Salary and (B) a prorated Annual Bonus based on (I) the target
Annual Bonus opportunity in the year in which the Date of Termination occurs or
the prior year if no target Annual Bonus opportunity has yet been determined
and (II) the fraction of the year the Executive was employed, and (ii) all of
the Executive’s outstanding equity-based awards shall vest on the Date of
Termination and the Executive’s outstanding stock options shall remain
exercisable for three years following the Date of Termination (or until the
last day of the stock option term, whichever occurs first).

(e)           Retirement.  If the Executive retires after having attained
age 62, (i) the Company shall pay to the Executive, within thirty business days
after the Date of Termination, any earned but unpaid Annual Base Salary, (ii)
the Company shall pay to the Executive, within thirty business days after the
Date of Termination, a prorated Annual Bonus based on (A) the target Annual
Bonus opportunity in the year in which the Date of Termination occurs or the
prior year if no target Annual Bonus opportunity has yet been determined and
(B) the fraction of the year the Executive was employed, (iii) the Executive
shall receive applicable retiree benefits, if any, provided at such time by the
Company to retirees or as the Company shall determine, and (iv) the Executive’s
equity-based awards shall become vested and Executive’s stock options shall
remain exercisable until the last day of the option term thereof.  The Executive shall only be deemed to have
retired for purposes of this Agreement if he has satisfied the conditions set
forth in this Section 5(e) and the Executive specifies in the Notice of
Termination that the termination is due to retirement. For avoidance of doubt,
the Executive shall not be entitled to receive benefits pursuant to this
Section 5(e) if he receives benefits under Section 5(a), (b), (c) or (d).

6.             Certain Tax Consequences.

(a)           The Excise Tax and Gross-Up
Payment.  If any payments or benefits
paid or provided or to be paid or provided to the Executive or for his benefit
pursuant to the terms of 

 

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this Agreement or otherwise in connection with, or
arising out of, his employment with the Company (a “Payment” or “Payments”)
would be subject to any excise tax (the “Excise Tax”) imposed by section 4999
of the Internal Revenue Code of 1986, as amended (the “Code”), then the
Executive will be entitled to receive an additional payment (a “Gross-Up
Payment”) in an amount such that after payment by the Executive of all taxes
(including any interest, penalties, additional tax, or similar items imposed
with respect thereto and the Excise Tax), including any such taxes imposed upon
the Gross-Up Payment, the Executive retains an amount of the Gross-Up Payment
equal to the Excise Tax imposed upon the Payments.

(b)           Determination of Excise Tax and
Gross-Up Payment.  An initial
determination as to whether a Gross-Up Payment is required pursuant to this
Agreement and the amount of such Gross-Up Payment will be made at the Company’s
expense by an accounting firm selected by the Company. The accounting firm will
provide its determination, together with detailed supporting calculations and documentation,
to the Company and the Executive within 10 days after the Date of Termination,
or such other time as requested by the Company or by the Executive. If the
accounting firm determines that no Excise Tax is payable by the Executive with
respect to a Payment or Payments, it will furnish the Executive with an opinion
reasonably acceptable to the Executive to that effect. The Gross-Up Payment, if
any, will be paid by the Company to the Executive within thirty business days
of the receipt of the accounting firm’s determination. Within 10 days after the
accounting firm delivers its determination to the Executive, the Executive will
have the right to dispute the determination. The existence of a dispute will
not in any way affect the Executive’s right to receive the Gross-Up Payment in
accordance with the determination. If there is no dispute, the determination
will be binding, final, and conclusive upon the Company and the Executive. If
there is a dispute, the Company and the Executive will together select a second
accounting firm, which will review the determination and the Executive’s basis
for the dispute and then will render its own determination, which will be
binding, final, and conclusive on the Company and on the Executive. The Company
will bear all costs associated with that determination, unless the
determination is not greater than the initial determination, in which case all
such costs will be borne by the Executive.

(c)           Tax Rate.  For purposes of determining the amount of the
Gross-Up Payment, the Executive will be deemed to pay federal income taxes at
the highest marginal rate of federal income taxation in the calendar year in
which the Gross-Up Payment is to be made and applicable state and local income
taxes at the highest marginal rate of taxation in the state and locality of the
Executive’s residence on the Date of Termination, net of the maximum reduction
in federal income taxes that would be obtained from deduction of those state
and local taxes.

(d)           Withholding.  Notwithstanding anything contained in this
Agreement to the contrary, in the event that, according to the accounting firm’s
determination, an Excise Tax will be imposed on any Payment or Payments, the
Company will pay to the applicable government taxing authorities as Excise Tax
withholding, the amount of the Excise Tax that the Company has actually
withheld from the Payment or Payments in accordance with law.

(e)           Section 409A.  The Company and Executive acknowledge that
certain amounts payable under this Agreement may be treated as non-qualified
deferred compensation subject to Section 409A. 
The parties agree to confer about modifications to this Agreement to the
extent required to comply with Code Section 409A and the regulations thereunder.  The 

 

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Company may delay payments under this Agreement for
the period required by Code Section 409A to avoid penalties and interest to
Executive under Code Section 409A.

7.             Release.  Notwithstanding
any provision herein to the contrary, the Company will require that, prior to
payment of any amount or provision of any benefit under section 5 of this
Agreement (other than due to the Executive’s death), the Executive shall have
executed a complete release of the Company and its affiliates and related
parties in such form as is reasonably required by the Company, and any waiting
periods contained in such release shall have expired.

8.             Non-Exclusivity of Rights.  Except as otherwise provided in this
Agreement, nothing in this Agreement shall prevent or limit the Executive’s
continuing or future participation in any plan, program, policy or practice
provided by the Company or any of its affiliated companies for which the
Executive may qualify (other than severance policies). Vested benefits and
other amounts that the Executive is otherwise entitled to receive under any
other plan, program, policy, or practice of, or any contract or agreement with,
the Company or any of its affiliated companies on or after the Date of
Termination shall be payable in accordance with the terms of each such plan,
program, policy, practice, contract or agreement, as the case may be, except as
expressly modified by this Agreement.

9.             Full Settlement.  In no event shall the Executive be obligated
to seek other employment or take any other action by way of mitigation of the
amounts payable to the Executive under any of the provisions of this Agreement
and, except as otherwise provided in subsections 5(a)(iv) and 15(e), the amount
of any payment or benefit provided for in this Agreement shall not be reduced
by any compensation earned by the Executive as the result of employment by
another employer, by retirement benefits, by offset against any amount claimed
to be owed by the Executive to the Company, or otherwise.

10.           Non-Competition; Confidential
Information; and Non-Solicitation.

(a)           Non-Competition. During the Term of
Employment and for the six (6) month period following the Date of Termination
for any reason (or the for the one (1) year period following the Date of
Termination if the Executive’s combined service with the Company and Tower is at
least three (3) years as of the Date of Termination and the Executive receives
severance benefits pursuant to section 5(a) or 5(b)), the Executive shall not,
without the prior written consent of the Company, as a shareholder, officer,
director, partner, consultant, employee or otherwise, engage in any business or
enterprise which is “in competition” (as defined below) with the Company  its affiliates, or their successors or assigns
(such entities collectively referred to hereinafter in this section 10 as the “Company”)
in Bermuda or the states of New York or New Jersey; provided, however, that the
Executive’s ownership of less than five percent of the issued and outstanding
voting securities of a publicly traded company shall not, in and of itself, be
deemed to constitute such competition. A business or enterprise is deemed to be
“in competition” if it is engaged in any business in which the Company either
(i) is engaged in as of the Date of Termination or (ii) as of the Date of
Termination, contemplates engaging in within six (6) months following the Date
of Termination (or within one (1) year following the Date of 

 

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Termination if the Executive has been employed at the
Company for at least three (3) years as of the Date of Termination and the
Executive receives severance benefits pursuant to section 5(a) or 5(b)).  Notwithstanding the foregoing, upon
termination of employment by the Company for any reason, Executive shall not be
prohibited from becoming employed by Tower and its affiliates in any capacity.

(b)                           Confidential
Information.  The Executive shall
hold in a fiduciary capacity for the benefit of the Company all secret or
confidential information, knowledge, trade secrets, methods, know-how or data
relating to the Company or its affiliates and their businesses or acquisition
prospects that the Executive obtained or obtains during the Executive’s
employment by the Company (“Confidential Information”), provided that “Confidential
Information” shall not include any secret or confidential information,
knowledge, trade secrets, methods, know-how or data that is or becomes
generally known to the public (other than as a result of the Executive’s
violation of this section 10). Except as may be required and appropriate in
connection with carrying out his duties under this Agreement, the Executive
shall not communicate, divulge, or disseminate any material Confidential
Information at any time during or after the Executive’s employment with the
Company, except with the prior written consent of the Company or as otherwise
required by law or legal process; provided, however, that if so required, the
Executive will provide the Company with reasonable notice to contest such
disclosure.

(c)           Non-Solicitation.  During the Term of Employment and for the six
(6) month period following the Date of Termination for any reason (or the for
the one (1) year period following the Date of Termination if the Executive’s
combined service with the Company and Tower is at least three (3) years as of
the Date of Termination and the Executive receives severance benefits pursuant
to section 5(a) or 5(b)), the Executive will not, directly or indirectly,
initiate any action to solicit or recruit anyone who is then an employee of the
Company for the purpose of being employed by him or by any business,
individual, partnership, firm, corporation or other entity on whose behalf he
is acting as an agent, representative, employee or otherwise.

(d)           Non-Interference with Customers or
Producers.  During the Term of
Employment and for the six (6) month period following the Date of Termination
for any reason (or the for the one (1) year period following the Date of
Termination if the Executive’s combined service with the Company and Tower is at
least three (3) years as of the Date of Termination and the Executive receives
severance benefits pursuant to section 5(a) or 5(b)), the Executive will not
interfere with any business relationship between the Company and any of its
customers or agents or brokers that produce insurance business for the Company.

(e)           Remedies; Severability.

(i)            The Executive acknowledges that if
the Executive shall breach or threaten to breach any provision of subsections
10(a) through (d), the damages to the Company may be substantial, although
difficult to ascertain, and money damages will not afford the Company an
adequate remedy. Therefore, if the provisions of subsections 10(a) through (d)
are violated, in whole or in part, the Company shall be entitled to specific
performance and injunctive relief, without prejudice to other remedies the
Company may have at law or in equity.

 

11

 

(ii)           If any term or provision of this section
10, or the application thereof to any person or circumstances shall, to any
extent, be invalid or unenforceable, the remainder of this section 10, or the
application of such term or provision to persons or circumstances other than
those as to which it is held invalid or unenforceable, shall not be affected
thereby, and each term and provision of this section 10 shall be valid and
enforceable to the fullest extent permitted by law. Moreover, if a court of
competent jurisdiction deems any provision of subsections 10(a) through (d) to
be too broad in time, scope, or area, it is expressly agreed that such
provision shall be reformed to the maximum degree that would not render it
unenforceable.

11.           Attorneys’ Fees.  Each party shall pay its own legal fees, court
costs, litigation expenses and/or arbitration expenses (as applicable) in
connection with any dispute, litigation or arbitration regarding the validity
or enforceability of, or liability under or otherwise involving, any provision
of this Agreement, except that if the Executive prevails on the majority of
material claims disputed, the Company shall pay all reasonable legal fees,
court cost, litigation expenses and/or arbitration expenses.

12.           Indemnification.  The Executive shall be indemnified by the
Company for actions taken in his position as an officer, director, employee and
agent of the Company to the greatest extent permitted by applicable law. The
Executive shall also be covered as an insured by a liability insurance policy
secured by and maintained by the Company covering acts of officers and members
of the Board.

13.           Successors.

(a)           Assignment of Agreement.  This Agreement is personal to the Executive
and, without the prior written consent of the Company, shall not be assignable
by the Executive otherwise than by will or the laws of descent and
distribution.

(b)           Successors of the Company.  No rights or obligations of the Company under
this Agreement may be assigned or transferred except that the Company will
require any successor (whether direct or indirect, by purchase, merger,
consolidation or otherwise) to all or substantially all of the business and/or
assets of the Company to expressly assume and agree to perform this Agreement
in the same manner and to the same extent that the Company would be required to
perform it if no such succession had taken place. As used in this Agreement, “Company”
shall mean the Company as herein before defined and any successor that executes
and delivers the agreement provided for in this section 13 or which otherwise
becomes bound by all the terms and provisions of this Agreement by operation of
law.

14.           Arbitration.  Except for matters covered under section 10,
in the event of any dispute or difference between the Company and the Executive
with respect to the subject matter of this Agreement and the enforcement of
rights hereunder, either the Executive or the Company may, by written notice to
the other, require such dispute or difference to be submitted to arbitration.
The arbitrator or arbitrators shall be selected by agreement of the parties or,
if they cannot agree on an arbitrator or arbitrators within 30 days after the
date arbitration is required by either party, then the arbitrator or
arbitrators shall be selected by the American Arbitration Association upon the
application of the Executive or the Company. The determination reached in 

 

12

 

such arbitration shall be final and binding on both
parties without any right of appeal or further dispute. Execution of the
determination by such arbitrator may be sought in any court of competent
jurisdiction. The arbitrators shall not be bound by judicial formalities and
may abstain from following the strict rules of evidence and shall interpret
this Agreement as an honorable engagement and not merely as a legal obligation.
Unless otherwise agreed by the parties, any such arbitration shall take place
in New York, New York.

15.           Miscellaneous.

(a)           Governing Law and Captions.  This Agreement shall be governed by, and
construed in accordance with, the laws of New York without reference to
principles of conflict of laws. The captions of this Agreement are not part of
the provisions hereof and shall have no force or effect.

(b)           Notices.  All notices and other communications under
this Agreement shall be in writing and shall be given by hand delivery or by
facsimile (provided confirmation of receipt of such facsimile is received) to
the other party or by registered or certified mail, return receipt requested,
postage prepaid, or by Federal Express or other nationally-recognized overnight
courier that requires signatures of recipients upon delivery and provides
tracking services, addressed as follows:

If to the Executive:

c/o CastlePoint Holdings, Ltd.

Clarendon House

2 Church Street

Hamilton HM11, Bermuda

Attention: Joel S. Weiner

Facsimile: (441) 292-4720

 

If to the Company:

CastlePoint Holdings, Ltd.

Clarendon House

2 Church Street

Hamilton HM11, Bermuda

Attention:  The Secretary

Facsimile:  (441)-292-4720

or to such other address as
either party furnishes to the other in writing in accordance with this
subsection 15(b).  Copies (which shall
not constitute notice) of notices to the Company shall also be sent to: Roslyn
Tom, Baker & McKenzie, 1114 Avenue of Americas, New York, New York 10036,
or to such other address or to the attention of such other person as the
recipient party has specified by prior written notice to the sending
party.  Notices and communications shall
be effective when actually received by the addressee.

 

13

 

(c)           Amendment.  This Agreement may not be amended or modified
except by a written agreement executed by the parties hereto or their
respective successors and legal representatives.

(d)           Severability.  The invalidity or unenforceability of any
provision of this Agreement shall not affect the validity or enforceability of
any other provision of this Agreement. If any provision of this Agreement shall
be held invalid or unenforceable in part, the remaining portion of such
provision, together with all other provisions of this Agreement, shall remain
valid and enforceable and continue in full force and effect to the fullest
extent consistent with law.

(e)           Withholding.  Notwithstanding any other provision of this
Agreement, the Company may withhold from amounts payable under this Agreement
all federal, state, local, and foreign taxes that are required to be withheld
by applicable laws or regulations.

(f)            Waiver.  The Executive’s or the Company’s failure to
insist upon strict compliance with any provision of, or to assert any right
under, this Agreement (including, without limitation, the right of the
Executive to terminate employment for Good Reason) shall not be deemed to be a
waiver of such provision or right or of any other provision of or right under
this Agreement.

(g)           Entire Understanding; Counterparts.
 The Executive and the Company
acknowledge that this Agreement supersedes and terminates any other severance
and/or employment agreements between the Executive and the Company or any
Company affiliates. This Agreement may be executed in several counterparts,
each of which shall be deemed an original, and said counterparts shall
constitute but one and the same instrument.

(h)           Rights and Benefits Unsecured.
 The rights and benefits of the Executive
under this Agreement may not be anticipated, assigned, alienated, or subject to
attachment, garnishment, levy, execution, or other legal or equitable process
except as required by law. Any attempts by the Executive to anticipate,
alienate, assign, sell, transfer, pledge or encumber the same shall be void.
Payments hereunder shall not be considered assets of the Executive in the event
of insolvency or bankruptcy.

(i)            Noncontravention.  The Company represents that the Company is not
prevented from entering into, or performing this Agreement by the terms of any
law, order, rule or regulation, its by-laws or declaration of trust, or any
agreement to which it is a party.

(j)            Section and Subsection Headings.
 The section and subsection headings in
this Agreement are for convenience of reference only; they form no part of this
Agreement and shall not affect its interpretation.

 

14

 

IN WITNESS WHEREOF, the
Executive has hereunto set the Executive’s hand and, pursuant to the
authorization of the Board, the Company has caused this Agreement to be
executed, all as of the day and year first above written.

 

CASTLEPOINT HOLDINGS, LTD.

By:___/s/ Michael H. Lee______

Name: Michael H. Lee

Its: Chairman, President and CEO

 

____   /s/ Joel Weiner___________

Joel Weiner

 

15EXHIBIT 10.4

EMPLOYMENT AGREEMENT

THIS
AGREEMENT (the “Agreement”), dated as of January 16, 2007, is by and between
CastlePoint Holdings, Ltd., a Bermuda exempted company (the “Company”), and
Gregory T. Doyle (the “Executive”).

WITNESSETH THAT

WHEREAS,
the Company is a Bermuda exempted company; and

WHEREAS,
the Executive and the Company wish to enter into a written agreement setting
forth the terms and conditions of the Executive’s employment with the Company;
and

WHEREAS,
this Agreement is the entire agreement between the parties concerning the
subject matter hereof and supersedes all prior agreements concerning the same
subject.

NOW,
THEREFORE, in consideration of the premises and the mutual covenants contained
herein, the Company and the Executive hereby agree as follows:

1.             Term.

(a)           Term of Employment.

(i)            The Company shall employ the
Executive, and the Executive shall serve the Company, on the terms and subject
to the conditions set forth in this Agreement, commencing on the October 19,
2006 (the “Effective Date”) and, unless sooner terminated pursuant to section
4, continuing until the date that is the 18 month anniversary of the Effective
Date or such later date as provided in subsection 1(a)(ii) below (the “Term of
Employment”).

(ii)           The Term of Employment shall
be extended automatically for one additional year on the last day before the
first anniversary of the Effective Date and for one additional year on each
anniversary thereafter unless and until either party gives written notice to
the other not to extend this Agreement at least six months before such
extension would be effectuated.

(b)           Term of the Agreement.  This
Agreement shall become effective on the Effective Date and shall continue in
effect throughout the Term of Employment; provided, however, the restrictive
covenants contained in section 10 of this Agreement and, as applicable, the
Company’s and the Executive’s obligations under the other provisions of this
Agreement shall survive the Term of Employment and shall continue in effect
through the periods provided therein and/or until the Company’s and/or the
Executive’s obligations, as applicable, thereunder are satisfied.

 

1

 

2.             Position and Duties.

(a)         
Positions and Responsibilities.

(i)            The Executive shall serve as
President of the Company and president of CastlePoint Management Corporation
and CastlePoint Insurance Company  and/or in such other positions as the
Chief Executive Officer of the Company (the “CEO”), the Board of Directors of
the Company (the “Board”) or a committee of the Board may from time to time
prescribe, with such duties and responsibilities as are customarily assigned to
such position(s). The Executive shall report solely to the CEO unless the CEO,
the Board or a committee of the Board determines otherwise. The Executive
agrees to serve without additional compensation in such capacities (including,
without limitation, as an employee or director) with Company and its affiliates
as the CEO, the Board or a committee of the Board may in its discretion
prescribe. Upon termination of the Executive’s employment with the Company, any
employment, board membership or other service relationship with the Company and
any Company affiliate shall automatically terminate unless otherwise determined
by the parties hereto; provided, however, that the Executive  shall
execute any letters necessary to accomplish the foregoing if such is required
under Bermuda law.

(ii)           The Executive shall perform
his duties at the offices of the Company in Bermuda and at the offices of CastlePoint Management Corp.
and Castle Point Insurance Company in New York. The Executive shall
travel to such places outside of Bermuda and New York on the business of the
Company in such manner and on such occasions as the Company may from time to
time reasonably require.

(iii)          The Executive shall use his best
efforts to obtain, maintain and renew a suitable work permit or permits from
the governmental authorities of Bermuda to enable him to perform his
contemplated employment. The Company shall pay any permit fees. The executive’s
employment is subject to the requirements of the Bermuda ministry of Home
Affairs.

(b)           Time and Attention. Excluding any
periods of vacation and sick leave to which the Executive is entitled, the Executive
shall devote substantially all of his attention and time during normal working
hours to the business and affairs of the Company and its affiliates. It shall
not be considered a violation of the foregoing, however, for the Executive to
(i) serve on corporate, industry, educational, religious, civic, or charitable
boards or committees or (ii) make and attend to passive personal investments in
such form as will not require any material time or attention to the operations
thereof during normal working time and will not violate the provisions of
section 10 hereof, so long as such activities in clauses (i) and (ii) do not
materially interfere with the performance of the Executive’s responsibilities
as an employee of the Company in accordance with this Agreement or violate
section 10 of this Agreement.

3.             Compensation.  Except
as otherwise expressly set forth below, the Executive’s compensation shall be
determined by, and in the sole discretion of, the Compensation Committee of the
Board (the “Committee”).

(a)           Annual Base Salary.  Subject
to adjustment pursuant to this subsection 3(a), the Executive shall receive an
annual base salary of Four Hundred Fifty Thousand Dollars ($450,000)
during the Term of Employment (the annual base salary in effect from time

 

2

 

to
time, “Annual Base Salary”) payable in monthly installments on the 15th
day of each month, 15 days in arrears and 15 days in advance. The Annual Base
Salary shall be reviewed from time to time, but not less frequently than
annually, and, in the discretion of the Committee, may be adjusted but not
decreased below the amount set forth in the first sentence of this subsection
3(a). To the extent Annual Base Salary is adjusted, then such adjusted salary shall
be the Executive’s Annual Base Salary for all purposes of this Agreement.

(b)           Annual Bonus.  The
Executive shall have an opportunity to receive annual bonuses during the Term
of Employment (the “Annual Bonus”), subject to such terms and conditions as the
Committee shall prescribe. The Executive’s target Annual Bonus opportunity
shall be equal to thirty-seven and one-half percent (37.5%) of his Annual Base
Salary rate, it being understood that the actual Annual Bonus received by the
Executive will depend on the level of attainment of performance and other
factors used by the Committee to determine Annual Bonus amounts and that there
is no guarantee that an Annual Bonus will be earned. The Executive’s target
Annual Bonus opportunity shall be reviewed from time to time, but not less
frequently than annually, and, in the discretion of the Committee, may be
adjusted but not decreased below the amount set forth in the second sentence of
this subsection 3(b). Notwithstanding the foregoing, the bonus for 2006 shall
be pro-rated to reflect two and one-half months of employment.

(c)           Employee Benefits; Fringe Benefits.
 In addition to the foregoing, during the Term of Employment,

(i)            As soon as reasonably
practicable, the Committee shall grant to the Executive an award of Company
stock options  valued in the amount of Four Hundred Thousand Dollars
($400,000). The exercise price of the options shall be determined as of grant
date.  The other terms of the stock option shall be as set forth in the
Company’s 2006 Long-Term Equity Compensation Plan and an option agreement to be
entered into thereunder.  The equity award provided for in this subsection
(i) is made as an inducement essential to the Executive’s entering into this
Agreement. Vesting shall occur in three equal installments over the course of
42 months, but in the event of termination without cause, fifty percent of the
equity grant will vest automatically.

(ii)           to the extent not
duplicative of the specific benefits provided herein, subject to the following
sentence, the Executive shall be eligible to participate in all incentive
compensation, retirement, supplemental retirement, and deferred compensation
plans, policies and arrangements that are provided generally to other senior
officers of the Company.  In particular, the Executive shall receive an
annual target equity award under the Company’s 2006 Long-Term Equity
Compensation Plan of 37.5% of annual base salary.

(iii)          the Executive and, as
applicable, the Executive’s covered dependents shall be eligible to participate
in all of the Company’s health and welfare benefit plans, i.e., health, dental,
life insurance and disability insurance (within the meaning of Section 3(1) of
the Employee Retirement Income Security Act of 1974, as amended); and

 

3

 

(iv)          the Executive shall be
entitled to receive fringe benefits provided for senior officers of the
Company, and shall be entitled to avail himself of paid holidays, as determined
from time to time by the Company.

(d)           Vacation. The Executive
shall be entitled to a maximum of five weeks of paid vacation per calendar year
during the Term of Employment. Vacation days not used within the year shall be
carried forward to subsequent years, as determined by the Company and subject to
such conditions or restrictions as the Company may prescribe. Section 11 of the
Bermuda Employment Act of 2000 shall otherwise not apply to the Executive’s
employment.

(e)           Expenses. The Executive
shall be reimbursed by the Company for reasonable business expenses actually
incurred in rendering to the Company the services provided for hereunder during
the Term of Employment, payable in accordance with customary Company practice,
after the Executive presents written expense statements or such other supporting
information as the Company may require of its senior officers for reimbursement
of such expenses.

(f)            Bermuda Related Expenses. The Executive
shall be entitled to a paid country club membership in Bermuda and entitled to
exclusive use of a company car and/or a scooter for so long as the Executive is
based on a regular basis in Bermuda. The Executive is also entitled to the
services of AYCO for financial and estate planning, including annual income tax
preparation. The Executive shall also receive, If the Executive is based on a
regular basis in  Bermuda, a housing allowance of Nine Thousand Five
Hundred Dollars per month ($9,500) and one-time relocation expenses in the net
amount of Ten Thousand Dollars ($10,000) , a one-time repartition allowance in
the net amount of Six Thousand Dollars ($6,000) and a travel allowance in the
net amount of Twelve Thousand Dollars ($12,000) per year for travel to and from
Bermuda for the Executive and his immediate family pursuant to Company policies
as in effect from time to time.

4.             Termination of Employment.

(a)           Termination of Employment
and Term of Employment. The Company or the Executive may terminate
the Executive’s employment at any time and for any reason in accordance with
subsection 4(b) below. The Term of Employment shall be deemed to have ended on
the last day of the Executive’s employment. The Term of Employment shall
terminate upon the Executive’s death.

(b)           Notice of Termination. Any purported
termination of the Executive’s employment (other than by reason of death) shall
be communicated by written Notice of Termination from one party hereto to the
other party hereto in accordance with the notice provisions contained in
subsection 15(b) below. For purposes of this Agreement, a “Notice of
Termination” shall mean a notice that indicates the Date of Termination and,
with respect to a termination due to Disability, Cause or Good Reason, sets
forth in reasonable detail the facts and circumstances that are alleged to
provide a basis for such termination. A Notice of Termination from the Company
shall specify whether the

 

4

 

termination
is with or without Cause or due to the Executive’s Disability. A Notice of
Termination from the Executive shall specify whether the termination is with or
without Good Reason and, if the termination is without Good Reason, whether the
termination is due to his Disability or retirement. For avoidance of doubt, the
Executive shall not be deemed to have retired for purposes of this Agreement if
his employment is terminated by the Company (whether or not such termination is
with or without Cause or due to the Executive’s Disability), by the Executive
with Good Reason, due to a Disability or due to the Executive’s death.

(c)           Date of Termination. For purposes
of this Agreement, “Date of Termination” shall mean the date specified in the
Notice of Termination (but in no event shall such date be earlier than the 30th
day following the date the Notice of Termination is given, unless expressly
agreed to by the parties hereto) or the date of the Executive’s death.

(d)           No Waiver. The failure
to set forth any fact or circumstance in a Notice of Termination, which fact or
circumstance was not known to the party giving the Notice of Termination when
the notice was given, shall not constitute a waiver of the right to assert such
fact or circumstance in an attempt to enforce any right under or provision of
this Agreement.

(e)           Cause. For purposes
of this Agreement, the term “Cause” means: (i) the Executive’s gross negligence
or gross misconduct or (ii) the Executive’s having been convicted of, or
entered a plea of nolo contendere to, a crime involving moral turpitude or a
felony. No act or failure to act directly related to Company action or inaction
that constitutes Good Reason shall constitute Cause under this Agreement if the
Executive has provided a Notice of Termination based on such Good Reason event
prior to the Company’s giving of the Notice of Termination for Cause. The
Executive’s termination for Cause shall be effective when and if a resolution
is duly adopted by an affirmative vote of the entire Board (less the Executive
if serving on the Board), stating that, in the good faith opinion of the Board,
the Executive is guilty of the conduct described in the Notice of Termination,
and such conduct constitutes Cause under this Agreement; provided, however,
that the Executive shall have been given the opportunity (i) to cure any act or
omission that constitutes Cause if capable of cure and (ii), together with counsel,
during the 30-day period following the receipt by the Executive of the Notice
of Termination and prior to the adoption of the Board’s resolution, to be heard
by the Board.

(f)            Disability. For purposes
of this Agreement, the Executive shall be deemed to have a Disability if the
Executive is entitled to long-term disability benefits under the Company’s
long-term disability plan or policy, as the case may be, as in effect on the
Date of Termination.

(g)           Good Reason. For purposes
of this Agreement, the term “Good Reason” means the occurrence (without the
Executive’s express written consent) of any of the following acts or failures
to act by the Company:

(i)            any reduction in the
Executive’s Annual Base Salary or target Annual Bonus opportunity;

(ii)           requiring the Executive to
be based more than 50 miles away from Bermuda or New York City, New York;

 

5

 

(iii)          the material breach by the
Company of any of its other obligations under this Agreement; or

(iv)          the failure of the Company
to obtain the assumption of this Agreement as contemplated in subsection 13(b)
hereof.

The
Executive’s continued employment shall not constitute consent to, or a waiver
of rights with respect to, any act or failure to act constituting Good Reason
hereunder; provided, however, that no such event described above shall
constitute Good Reason unless the Executive has given a Notice of Termination
to the Company specifying the condition or event relied upon for such
termination within 90 days from the Executive’s actual knowledge of the
occurrence of such event and, if capable of cure, the Company has failed to
cure the condition or event constituting Good Reason within the 30 day period
following receipt of the Executive’s Notice of Termination.

5.             Obligations of the Company
upon Termination.

(a)           Termination by the Company
for other than Cause or by the Executive for Good Reason.  If the
Executive’s employment is terminated by the Company for any reason other than
Cause or Disability or by the Executive for Good Reason, including
reorganization or restructuring of the Company,

(i)            The Company shall pay to the
Executive, within thirty business days of the Date of Termination, any earned
but unpaid Annual Base Salary;

(ii)           The Company shall pay to the
Executive, within thirty business days of the Date of Termination, 150% of his
annual base salary and his target bonus;

(iii)          For a eighteen (18) months
after the Date of Termination, the Company will arrange to provide the
Executive (and any covered dependents), without cost to the Executive, with
life, accident and health insurance benefits substantially similar to those the
Executive and any covered dependents were receiving immediately prior to the
Notice of Termination, except for any such benefits that were waived by the
Executive in writing. If the Company arranges to provide the Executive and
covered dependents with life, accident and health insurance benefits, those
benefits will be reduced to the extent comparable benefits are actually received
by, or made available to, the Executive by a subsequent employer without cost
during the eighteen (18) month period, as the case may be, following the
Executive’s Date of Termination. The Executive must report to the Company any
such benefits that he actually receives or are made available. In lieu of the
benefits described in this subsection 5(a)(iii), the Company, in its sole
discretion, may elect to pay to the Executive a lump sum cash payment equal to
the total premiums that would have been paid by the Company to provide such
benefits to the Executive (determined based on the premiums paid by the Company
immediately prior to the Date of Termination). Nothing in this subsection 5(a)(iii)
will affect the Executive’s right to elect COBRA continuation coverage in
accordance with applicable law or extend the COBRA continuation coverage
period; and

 

6

 

(iv)          The Executive shall have at
least three (3) months (or until the last day of the stock option term, whichever
occurs first) to exercise any then vested outstanding stock options.

(b)           Termination in Connection
with a Change in Control.

(i)            If, in anticipation of or
within the 24 month period following a Change in Control (as defined below),
the Executive’s employment is terminated by the Company for any reason other
than Cause or Disability or by the Executive for Good Reason, the Executive
shall receive the payments and benefits described in subsection 5(a), and, in
addition, all of the Executive’s outstanding equity-based awards shall become
fully vested on the Date of Termination.

(ii)           For purposes of this
Agreement, the term “Change in Control” means the occurrence of any of the
following events:

A.            any “person” (within the
meaning ascribed to such term in Section 3(a)(9) of the Securities Exchange Act
of 1934, as amended from time to time (the “Exchange Act”) and used in Sections
13(d) and 14(d) thereof, including a “group” as used in Section 13(d) thereof),
other than the Company, any trustee or other fiduciary holding securities under
an employee benefit plan of the Company, or any corporation owned directly or
indirectly by the stockholders of the Company in substantially the same
proportion as the ownership of stock of the Company, (a “Person”) that is not
on the Effective Date the “beneficial owner” (as defined in Rule 13d-3 under
the Exchange Act), directly or indirectly, of securities of the Company
representing more than 35% of the combined voting power of the Company’s then
outstanding securities becomes after the Effective Date the beneficial owner,
directly or indirectly, of securities of the Company representing more than 35%
of the combined voting power of the Company’s then outstanding securities;

B.            individuals who, as of the
Effective Date, constitute the Board (the “Incumbent Board”) cease for any
reason to constitute at least a majority of the Board of the Company, provided
that any person becoming a director subsequent to the date hereof whose
election, or nomination for election by the Company’s stockholders, was
approved by a vote of at least a majority of the directors then comprising the
Incumbent Board (other than an election or nomination of an individual whose
initial assumption of office is in connection with an actual or threatened election
contest relating to the election of the directors of the Company) shall be, for
purposes of this definition, considered as though such person were a member of
the Incumbent Board;

C.            consummation of a merger,
consolidation, reorganization, share exchange or similar transaction (a “Transaction”)
of the Company with any other entity, other than (I) a Transaction that would
result in the voting securities of the Company outstanding immediately prior
thereto directly or indirectly continuing to represent (either by remaining
outstanding or by being converted into voting securities of the surviving
entity or a parent company) more than 80% of the combined voting power of the
voting securities of the Company or such surviving entity or parent company
outstanding immediately after such Transaction or

 

7

 

(II)
a Transaction effected to implement a recapitalization of the Company (or
similar transaction) in which no Person acquires more than 35% of the combined
voting power of the Company’s then outstanding securities;

D.            the sale, transfer or other
disposition (in one transaction or a series of related transactions) of more
than 50% of the operating assets of the Company; or

E.             the approval by the
shareholders of a plan or proposal for the liquidation or dissolution of the
Company.

Notwithstanding
anything to the contrary contained in the foregoing definition, an initial
public offering of the Company’s shares shall not constitute a Change in
Control for purposes of this Agreement.  Any transaction with Tower Group,
Inc. and its affiliates (“Tower”) shall not constitute a Change in Control.

(c)           Termination by the Company
for Cause or by the Executive without Good Reason.  If the
Executive’s employment is terminated by the Company for Cause, the Company
shall pay to the Executive, within thirty business days of the Date of
Termination, any earned but unpaid Annual Base Salary and all outstanding stock
options (whether or not then exercisable), restricted stock and other incentive
awards shall be forfeited. If the Executive’s employment is terminated by the
Executive without Good Reason (and not due to death, Disability or retirement),
the Company shall pay to the Executive, within thirty business days of the Date
of Termination, any earned but unpaid Annual Base Salary, the Executive shall
have three months (or until the last day of the stock option term, whichever
occurs first) to exercise any outstanding vested stock options and all of the
Executive’s unvested equity-based awards shall be forfeited as of the Date of
Termination.

(d)           Termination due to Death or
Disability. If the Executive’s employment is terminated due to
death or Disability, (i) the Company shall pay to the Executive (or to the
Executive’s estate or personal representative in the case of the Executive’s
death), within thirty business days after the Date of Termination, (A) any
earned but unpaid Annual Base Salary and (B) a prorated Annual Bonus based on
(I) the target Annual Bonus opportunity in the year in which the Date of
Termination occurs or the prior year if no target Annual Bonus opportunity has
yet been determined and (II) the fraction of the year the Executive was
employed, and (ii) all of the Executive’s outstanding equity-based awards shall
vest on the Date of Termination and the Executive’s outstanding stock options
shall remain exercisable for three years following the Date of Termination (or
until the last day of the stock option term, whichever occurs first).

(e)           Retirement.  If the
Executive retires after having attained age 62, (i) the Company shall pay to
the Executive, within thirty business days after the Date of Termination, any
earned but unpaid Annual Base Salary, (ii) the Company shall pay to the
Executive, within thirty business days after the Date of Termination, a
prorated Annual Bonus based on (A) the target Annual Bonus opportunity in the
year in which the Date of Termination occurs or the prior year if no target
Annual Bonus opportunity has yet been determined and (B) the fraction of the
year the Executive was employed, (iii) the Executive shall receive applicable
retiree benefits, if any, provided at such time by the Company to retirees or
as the Company shall determine, and

 

8

 

(iv)
the Executive’s equity-based awards shall become vested and Executive’s stock
options shall remain exercisable until the last day of the option term thereof.
 The Executive shall only be deemed to have retired for purposes of this
Agreement if he has satisfied the conditions set forth in this Section 5(e) and
the Executive specifies in the Notice of Termination that the termination is
due to retirement. For avoidance of doubt, the Executive shall not be entitled
to receive benefits pursuant to this Section 5(e) if he receives benefits under
Section 5(a), (b), (c) or (d).

6.             Certain Tax Consequences.

(a)           The Excise Tax and Gross-Up
Payment.  If any payments or benefits paid or provided or to be paid or
provided to the Executive or for his benefit pursuant to the terms of this
Agreement or otherwise in connection with, or arising out of, his employment
with the Company (a “Payment” or “Payments”) would be subject to any excise tax
(the “Excise Tax”) imposed by section 4999 of the Internal Revenue Code of 1986,
as amended (the “Code”), then the Executive will be entitled to receive an
additional payment (a “Gross-Up Payment”) in an amount such that after payment
by the Executive of all taxes (including any interest, penalties, additional
tax, or similar items imposed with respect thereto and the Excise Tax),
including any such taxes imposed upon the Gross-Up Payment, the Executive
retains an amount of the Gross-Up Payment equal to the Excise Tax imposed upon
the Payments.

(b)           Determination of Excise Tax
and Gross-Up Payment.  An initial determination as to whether a
Gross-Up Payment is required pursuant to this Agreement and the amount of such
Gross-Up Payment will be made at the Company’s expense by an accounting firm
selected by the Company. The accounting firm will provide its determination,
together with detailed supporting calculations and documentation, to the
Company and the Executive within 10 days after the Date of Termination, or such
other time as requested by the Company or by the Executive. If the accounting
firm determines that no Excise Tax is payable by the Executive with respect to
a Payment or Payments, it will furnish the Executive with an opinion reasonably
acceptable to the Executive to that effect. The Gross-Up Payment, if any, will
be paid by the Company to the Executive within thirty business days of the
receipt of the accounting firm’s determination. Within 10 days after the
accounting firm delivers its determination to the Executive, the Executive will
have the right to dispute the determination. The existence of a dispute will
not in any way affect the Executive’s right to receive the Gross-Up Payment in
accordance with the determination. If there is no dispute, the determination
will be binding, final, and conclusive upon the Company and the Executive. If
there is a dispute, the Company and the Executive will together select a second
accounting firm, which will review the determination and the Executive’s basis
for the dispute and then will render its own determination, which will be binding,
final, and conclusive on the Company and on the Executive. The Company will
bear all costs associated with that determination, unless the determination is
not greater than the initial determination, in which case all such costs will
be borne by the Executive.

(c)           Tax Rate.  For
purposes of determining the amount of the Gross-Up Payment, the Executive will
be deemed to pay federal income taxes at the highest marginal rate of federal
income taxation in the calendar year in which the Gross-Up Payment is to be
made and applicable state and local income taxes at the highest marginal rate
of taxation in the state and

 

9

 

locality
of the Executive’s residence on the Date of Termination, net of the maximum
reduction in federal income taxes that would be obtained from deduction of
those state and local taxes.

(d)           Withholding.
 Notwithstanding anything contained in this Agreement to the contrary, in
the event that, according to the accounting firm’s determination, an Excise Tax
will be imposed on any Payment or Payments, the Company will pay to the
applicable government taxing authorities as Excise Tax withholding, the amount
of the Excise Tax that the Company has actually withheld from the Payment or
Payments in accordance with law.

(e)           Section 409A.  The
Company and Executive acknowledge that certain amounts payable under this
Agreement may be treated as non-qualified deferred compensation subject to
Section 409A.  The parties agree to confer about modifications to this
Agreement to the extent required to comply with Code Section 409A and the
regulations thereunder.  The Company may delay payments under this
Agreement for the period required by Code Section 409A to avoid penalties and
interest to Executive under Code Section 409A.

7.             Release.
 Notwithstanding any provision herein to the contrary, the Company will
require that, prior to payment of any amount or provision of any benefit under
section 5 of this Agreement (other than due to the Executive’s death), the Executive
shall have executed a complete release of the Company and its affiliates and
related parties in such form as is reasonably required by the Company, and any
waiting periods contained in such release shall have expired.

8.             Non-Exclusivity of Rights.  Except
as otherwise provided in this Agreement, nothing in this Agreement shall
prevent or limit the Executive’s continuing or future participation in any
plan, program, policy or practice provided by the Company or any of its
affiliated companies for which the Executive may qualify (other than severance
policies). Vested benefits and other amounts that the Executive is otherwise
entitled to receive under any other plan, program, policy, or practice of, or
any contract or agreement with, the Company or any of its affiliated companies
on or after the Date of Termination shall be payable in accordance with the
terms of each such plan, program, policy, practice, contract or agreement, as
the case may be, except as expressly modified by this Agreement.

9.             Full Settlement.  In no
event shall the Executive be obligated to seek other employment or take any
other action by way of mitigation of the amounts payable to the Executive under
any of the provisions of this Agreement and, except as otherwise provided in
subsections 5(a)(iv) and 15(e), the amount of any payment or benefit provided
for in this Agreement shall not be reduced by any compensation earned by the
Executive as the result of employment by another employer, by retirement
benefits, by offset against any amount claimed to be owed by the Executive to
the Company, or otherwise.

10.           Non-Competition;
Confidential Information; and Non-Solicitation.

(a)           Non-Competition. During the
Term of Employment and for the eighteen (18) months period following the Date
of Termination the Executive shall not, without the prior written consent of
the Company, as a shareholder, officer, director, partner, consultant, employee

 

10

 

or
otherwise, engage in any business or enterprise which is “in competition” (as
defined below) with the Company  its affiliates, or their successors or
assigns (such entities collectively referred to hereinafter in this section 10
as the “Company”) in Bermuda or the states of New York or New Jersey; provided,
however, that the Executive’s ownership of less than five percent of the issued
and outstanding voting securities of a publicly traded company shall not, in
and of itself, be deemed to constitute such competition. A business or
enterprise is deemed to be “in competition” if it is engaged in any business in
which the Company either (i) is engaged in as of the Date of Termination or
(ii) as of the Date of Termination, contemplates engaging in within eighteen
(18) months following the Date of Termination.  Notwithstanding the
foregoing, upon termination of employment by the Company for any reason,
Executive shall not be prohibited from becoming employed by Tower and its
affiliates in any capacity.

(b)           Confidential Information.  The
Executive shall hold in a fiduciary capacity for the benefit of the Company all
secret or confidential information, knowledge, trade secrets, methods, know-how
or data relating to the Company or its affiliates and their businesses or
acquisition prospects that the Executive obtained or obtains during the
Executive’s employment by the Company (“Confidential Information”), provided
that “Confidential Information” shall not include any secret or confidential
information, knowledge, trade secrets, methods, know-how or data that is or becomes
generally known to the public (other than as a result of the Executive’s
violation of this section 10). Except as may be required and appropriate in
connection with carrying out his duties under this Agreement, the Executive
shall not communicate, divulge, or disseminate any material Confidential
Information at any time during or after the Executive’s employment with the
Company, except with the prior written consent of the Company or as otherwise
required by law or legal process; provided, however, that if so required, the
Executive will provide the Company with reasonable notice to contest such
disclosure.

(c)           Non-Solicitation.  During
the Term of Employment and for the eighteen (18) month period following the
Date of Termination for any reason, the Executive will not, directly or
indirectly, initiate any action to solicit or recruit anyone who is then an
employee of the Company or its affiliates or subsidiaries for the purpose of
being employed by him or by any business, individual, partnership, firm,
corporation or other entity on whose behalf he is acting as an agent,
representative, employee or otherwise.

(d)           Non-Interference with
Customers or Producers.  During the Term of Employment and for
the eighteen (18) month period following the Date of Termination for any
reason, the Executive will not interfere with any business relationship between
the Company or its affiliates and subsidiaries and any of its customers or
agents or brokers that produce insurance business for the Company.

(e)           Remedies; Severability.

(i)            The Executive acknowledges
that if the Executive shall breach or threaten to breach any provision of
subsections 10(a) through (d), the damages to the Company may be substantial,
although difficult to ascertain, and money damages will not afford the Company
an adequate remedy. Therefore, if the provisions of subsections 10(a) through
(d) are

 

11

 

violated,
in whole or in part, the Company shall be entitled to specific performance and
injunctive relief, without prejudice to other remedies the Company may have at
law or in equity.

(ii)           If any term or provision of
this section 10, or the application thereof to any person or circumstances
shall, to any extent, be invalid or unenforceable, the remainder of this
section 10, or the application of such term or provision to persons or
circumstances other than those as to which it is held invalid or unenforceable,
shall not be affected thereby, and each term and provision of this section 10
shall be valid and enforceable to the fullest extent permitted by law.
Moreover, if a court of competent jurisdiction deems any provision of
subsections 10(a) through (d) to be too broad in time, scope, or area, it is
expressly agreed that such provision shall be reformed to the maximum degree
that would not render it unenforceable.

11.           Attorneys’ Fees.  Each
party shall pay its own legal fees, court costs, litigation expenses and/or
arbitration expenses (as applicable) in connection with any dispute, litigation
or arbitration regarding the validity or enforceability of, or liability under
or otherwise involving, any provision of this Agreement, except that if the
Executive prevails on the majority of material claims disputed, the Company
shall pay all reasonable legal fees, court cost, litigation expenses and/or
arbitration expenses.

12.           Indemnification.  The
Executive shall be indemnified by the Company for actions taken in his position
as an officer, director, employee and agent of the Company to the greatest
extent permitted by applicable law. The Executive shall also be covered as an
insured by a liability insurance policy secured by and maintained by the
Company covering acts of officers and members of the Board.

13.           Successors.

(a)           Assignment of Agreement.  This
Agreement is personal to the Executive and, without the prior written consent
of the Company, shall not be assignable by the Executive otherwise than by will
or the laws of descent and distribution.

(b)           Successors of the Company.  No
rights or obligations of the Company under this Agreement may be assigned or
transferred except that the Company will require any successor (whether direct
or indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the Company to expressly
assume and agree to perform this Agreement in the same manner and to the same
extent that the Company would be required to perform it if no such succession
had taken place. As used in this Agreement, “Company” shall mean the Company as
herein before defined and any successor that executes and delivers the
agreement provided for in this section 13 or which otherwise becomes bound by
all the terms and provisions of this Agreement by operation of law.

14.           Arbitration.  Except
for matters covered under section 10, in the event of any dispute or difference
between the Company and the Executive with respect to the subject matter of
this Agreement and the enforcement of rights hereunder, either the Executive or
the Company may, by written notice to the other, require such dispute or
difference to be submitted to

 

12

 

arbitration.
The arbitrator or arbitrators shall be selected by agreement of the parties or,
if they cannot agree on an arbitrator or arbitrators within 30 days after the
date arbitration is required by either party, then the arbitrator or
arbitrators shall be selected by the American Arbitration Association upon the
application of the Executive or the Company. The determination reached in such
arbitration shall be final and binding on both parties without any right of
appeal or further dispute. Execution of the determination by such arbitrator
may be sought in any court of competent jurisdiction. The arbitrators shall not
be bound by judicial formalities and may abstain from following the strict
rules of evidence and shall interpret this Agreement as an honorable engagement
and not merely as a legal obligation. Unless otherwise agreed by the parties,
any such arbitration shall take place in New York, New York.

15.           Miscellaneous.

(a)           Governing Law and Captions.  This
Agreement shall be governed by, and construed in accordance with, the laws of
New York without reference to principles of conflict of laws. The captions of
this Agreement are not part of the provisions hereof and shall have no force or
effect.

(b)           Notices.  All
notices and other communications under this Agreement shall be in writing and
shall be given by hand delivery or by facsimile (provided confirmation of
receipt of such facsimile is received) to the other party or by registered or
certified mail, return receipt requested, postage prepaid, or by Federal
Express or other nationally-recognized overnight courier that requires
signatures of recipients upon delivery and provides tracking services,
addressed as follows:

If
to the Executive:

Mr. Gregory T. Doyle

32 Russett Road

Sandy
Hook, Connecticut 06482

If
to the Company:

CastlePoint Holdings, Ltd.

Victoria Hall

11 Victoria Street

Hamilton
HM11, Bermuda

Attention:  The Secretary

Facsimile:  (441)-292-4720

 

13

 

or to such other address as either party
furnishes to the other in writing in accordance with this subsection 15(b).
 Copies (which shall not constitute notice) of notices to the Company
shall also be sent to: Secretary, CastlePoint Management Corp., 120 Broadway,
New York, New York 10271, or to such other address or to the attention of such
other person as the recipient party has specified by prior written notice to
the sending party.  Notices and communications shall be effective when
actually received by the addressee.

 

(c)           Amendment.  This
Agreement may not be amended or modified except by a written agreement executed
by the parties hereto or their respective successors and legal representatives.

(d)           Severability.  The
invalidity or unenforceability of any provision of this Agreement shall not
affect the validity or enforceability of any other provision of this Agreement.
If any provision of this Agreement shall be held invalid or unenforceable in
part, the remaining portion of such provision, together with all other
provisions of this Agreement, shall remain valid and enforceable and continue
in full force and effect to the fullest extent consistent with law.

(e)           Withholding.
 Notwithstanding any other provision of this Agreement, the Company may
withhold from amounts payable under this Agreement all federal, state, local,
and foreign taxes that are required to be withheld by applicable laws or
regulations.

(f)            Waiver.  The Executive’s
or the Company’s failure to insist upon strict compliance with any provision
of, or to assert any right under, this Agreement (including, without
limitation, the right of the Executive to terminate employment for Good Reason)
shall not be deemed to be a waiver of such provision or right or of any other
provision of or right under this Agreement.

(g)           Entire Understanding;
Counterparts.  The Executive and the Company acknowledge
that this Agreement supersedes and terminates any other severance and/or
employment agreements between the Executive and the Company or any Company
affiliates. This Agreement may be executed in several counterparts, each of
which shall be deemed an original, and said counterparts shall constitute but
one and the same instrument.

(h)           Rights and Benefits
Unsecured.  The rights and benefits of the Executive
under this Agreement may not be anticipated, assigned, alienated, or subject to
attachment, garnishment, levy, execution, or other legal or equitable process
except as required by law. Any attempts by the Executive to anticipate,
alienate, assign, sell, transfer, pledge or encumber the same shall be void.
Payments hereunder shall not be considered assets of the Executive in the event
of insolvency or bankruptcy.

(i)            Noncontravention.  The
Company represents that the Company is not prevented from entering into, or
performing this Agreement by the terms of any law, order, rule or regulation,
its by-laws or declaration of trust, or any agreement to which it is a party.

 

14

 

(j)            Section and Subsection
Headings.  The section and subsection headings in this
Agreement are for convenience of reference only; they form no part of this
Agreement and shall not affect its interpretation.

(k)       
Executive’s Representations.  The Executive represents and warrants
that:

                                (a)  the
execution delivery and performance of this agreement by the Executive does not
and will not conflict with, breach, violate or cause a default under any
contract, agreement, instrument, order, judgment or decree to which the
Executive is a party or is bound.

                                (b)  the
Executive is a not a party to or bound by any employment agreement,
non-competition agreement or confidentiality agreement with any other person,
and

                                (c)  upon
the execution and delivery of this Agreement by the Company, this Agreement
will be valid and binding on the Executive and enforceable in accordance
with its terms.

                                (d)  there
are currently no disciplinary or grievance proceedings in place against the
Executive.

 

 

IN
WITNESS WHEREOF, the Executive has hereunto set the Executive’s hand and,
pursuant to the authorization of the Board, the Company has caused this
Agreement to be executed, all as of the day and year first above written.

 

	
   

  	
   

  	
  CASTLEPOINT HOLDINGS, LTD.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ Michael H. Lee

  
	
   

  	
   

  	
  Name: Michael H. Lee

  
	
   

  	
   

  	
  Its: Chairman, President
  and CEO

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
      /s/ Gregory T. Doyle

  
	
   

  	
   

  	
  Gregory T. Doyle

  

 

 

15

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