Document:

Exhibit 10.1

 

Consulting Agreement

 

This
Consulting Agreement (the “Agreement”) is entered into on this 17th day of
March, 2005, between Arch Capital Group Ltd. (the “Company”) and Robert
Clements (the “Executive”).

 

WHEREAS, the
Executive currently serves as the Chairman of the Board of Directors of the
Company and Chairman of the Board of Directors of Arch Capital Group (U.S.)
Inc., but he no longer wishes to serve the Company or Arch Capital Group (U.S.)
Inc. in those capacities; and

 

WHEREAS, the
Executive and the Company desire that the Executive provide consulting services
to the Company;

 

NOW,
THEREFORE, in consideration of the premises and agreements contained herein and
for other good and valuable consideration, the receipt and sufficiency of which
is hereby acknowledged by the parties hereto, it is hereby agreed as follows:

 

1.                                       The
Executive will cease to be a member of the Board of Directors of the Company
and the Board of Directors of Arch Capital Group (U.S.) Inc. on March 31,
2005.

 

2.                                       From
April 1, 2005 through December 31, 2009 (the “Consulting Term”), the
Executive shall make himself available to provide consulting services to the
Company, as reasonably requested by the Company, for up to 25 days per year
(or, in the case of calendar year 2005, a daily prorated portion thereof).  During the Consulting Term, the Executive
shall receive a retainer of $100,000 per calendar year, payable (except as set
forth below for 2005) in advance annually within ten days after the beginning
of the applicable calendar year (it being understood that the Company and the
Executive may mutually agree upon additional days during which the Executive
will provide consulting services to the Company and, in such case, the
Executive will be paid a daily prorated portion of the annual retainer amount
set forth above).  The retainer payable
for the period commencing on the first day of the Consulting Term and ending December 31,
2005 will be a daily prorated portion of the annual retainer, which payment
shall be made no later than ten days after the beginning of the Consulting
Term.  During the Consulting Term, the
Company will pay rent and utilities for office space occupied by the Executive
and will provide the Executive secretarial services, in each case, on a basis
consistent with those provided to him by the Company on the date hereof,
including the retention of his current assistant, to the extent she remains
available to do so, or a mutually agreeable substitute, who shall be
compensated in accordance with the Company’s compensation policies.  The Company shall reimburse the Executive for
all reasonable out-of-pocket expenses incurred by him in connection with his
provision of consulting services hereunder, upon presentation to the Company of
appropriate documentation.

 

3.                                       The
Executive shall, at the reasonable request of the Company, reasonably assist
and cooperate with the Company or its subsidiaries in the defense and/or
investigation of any third party claim or any investigation or proceeding,
whether actual or threatened, including, without limitation, participating as a
witness in any litigation, arbitration, hearing or other proceeding between the
Company or its subsidiaries and a third party or any government body.

 

 

The Company shall reimburse the Executive for
all reasonable out-of-pocket expenses incurred by him in connection with such
assistance, including, without limitation, travel and lodging expenses, upon
presentation to the Company of appropriate documentation.

 

4.                                       The
Company and the Executive agree that any statements made by either of them, or
anyone acting on their behalf, with respect to matters discussed in the
attached press release shall be consistent with the press release.

 

5.                                       For
the avoidance of doubt, Sections 5 (Certain Additional Payments), 7 (Full
Settlement; Legal Expenses) and 8 (Confidential Information; Nonsolicitation of
Employees and Customers) of the Retention Agreement, dated January 4, 2002
between the Company, Arch Capital Group (U.S.) Inc. and the Executive, as
subsequently amended on April 10, 2003, shall continue in full force and
effect in accordance with their terms, and the first paragraph of Section 8
thereof shall apply to any confidential information obtained by the Executive
with respect to the Company and its subsidiaries in the course of his provision
of consulting services hereunder.

 

6.                                       Nothing
in this Agreement shall limit or otherwise affect such rights as the Executive
may have under any share option or warrant agreement with the Company.  Without limiting the generality of the
foregoing, neither this Agreement nor any action taken hereunder shall
accelerate any deadline to exercise any options or warrants now held by the
Executive or members of his immediate family.

 

7.                                       The
Company shall reimburse the Executive for his reasonable attorney fees incurred
in connection with entering into this Agreement.

 

8.                                       This
Agreement shall be governed by and construed in accordance with the laws of the
State of New York, without reference to the principles of conflict of laws
thereof.

 

9.                                       This
Agreement may not be amended or modified otherwise than by a written agreement
executed by the parties hereto or their respective successors and legal
representatives.

 

10.                                 Each
of the paragraphs contained in this Agreement shall be enforceable
independently of every other paragraph in this Agreement, and the invalidity or
unenforceability of any paragraph shall not invalidate or render unenforceable
any other paragraph contained in this Agreement.

 

2

 

The parties to
this Agreement have executed this Agreement on the day and year first written
above.

 

	
   

  	
  ARCH CAPITAL
  GROUP LTD.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Dawna
  Ferguson

  	
   

  
	
   

  	
  Name:

  	
  Dawna
  Ferguson

  
	
   

  	
  Title:

  	
  Secretary

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  ROBERT
  CLEMENTS

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Robert
  Clements

  	
   

  
						

 

3

 

PRESS
RELEASE ATTACHMENT

 

(See Exhibit 99.1
to the Current Report on Form 8-K filed with the Securities Exchange
Commission by Arch Capital Group Ltd. on March 17, 2005.)EXHIBIT
10.10

 

EFC BANCORP, INC.

2000 STOCK OPTION PLAN

INCENTIVE STOCK OPTION AWARD AGREEMENT

 

	
  Name of Recipient:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Number of Shares

  	
   

  	
   

  
	
  Subject to the Option Award:

  	
   

  	
                  shares
  of EFC Bancorp, Inc. common stock (A Common Stock)

  
	
   

  	
   

  	
   

  
	
  Exercise Price:

  	
   

  	
  $

  
	
   

  	
   

  	
   

  
	
  Date of Grant:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  Term of Option:

  	
   

  	
  This
  Incentive Stock Option expires on

  
	
   

  	
   

  	
   

  
	
  Vesting Schedule:

  	
   

  	
  Subject
  to the limitations of this Incentive Stock Option Award Agreement, the
  Incentive Stock Option Award shall vest in installments according to the
  following schedule:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Installment

  	
   

  	
  Vesting
  Date

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Except as provided below, an installment shall not become exercisable
  on the otherwise applicable vesting date if the Recipient terminates
  employment or service prior to such vesting date.

  
	
   

  	
   

  	
   

  
	
  Payment of Exercise Price:

  	
   

  	
  The
  Exercise Price may be paid in cash, Common Stock or other consideration
  (including, where permitted by law and the Committee, Awards) having a Fair
  Market Value on the exercise date equal to the total Exercise Price, or by
  any combination of cash, Common Stock or other consideration, including a
  cashless exercise arrangement with a qualifying broker-dealer or a
  constructive stock swap.

  

 

 

	
  Effect of Termination of Employment or Service Because of:

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  (a)           Death or Disability:

  	
   

  	
  Unless
  otherwise determined by the Committee, all Incentive Stock Options
  immediately become exercisable and remain exercisable for a period of one (1)
  year following termination of employment or service as a result of death or
  disability, or if sooner, the expiration of the term of the Incentive Stock
  Option.

  
	
   

  	
   

  	
   

  
	
  (b)           Retirement:

  	
   

  	
  Unless
  otherwise determined by the Committee, Incentive Stock Options are
  exercisable only as to those Options that are immediately exercisable by the
  Recipient at the date of Retirement and remain exercisable for a period of
  one (1) year following Retirement, or if sooner, the expiration of the term of
  the Incentive Stock Option.

  
	
   

  	
   

  	
   

  
	
  (c)           Cause:

  	
   

  	
  Unless
  otherwise determined by the Committee, all rights under this Incentive Stock
  Option Award Agreement expire immediately upon the effective date of any
  Termination for Cause.

  
	
   

  	
   

  	
   

  
	
  (d)           Other reasons:

  	
   

  	
  Unless
  otherwise determined by the Committee, Incentive Stock Options are exercisable
  only as to those shares that are immediately exercisable by the Recipient on
  the date of termination of employment or service for reasons other than those
  listed above, and only for a period of three (3) months following termination
  of employment or service, or if sooner, the expiration of the term of the
  Incentive Stock Option.

  
	
   

  	
   

  	
   

  
	
  Acceleration
  of Vesting

  	
   

  	
   

  
	
  Upon a
  Change in Control:

  	
   

  	
  In
  the event of a Change in Control, all Incentive Stock Options held by a
  Recipient will become immediately exercisable and will remain exercisable
  until the expiration of the term of the Incentive Stock Option.

  
	
   

  	
   

  	
   

  
	
  Voting, Dividends, Etc.:

  	
   

  	
  The
  Recipient shall have no rights as a shareholder with respect to any shares of
  Common Stock covered by this Incentive Stock Option Award until the date of
  issuance of a stock certificate for the Common Stock covered by this
  Incentive Stock Option Award following exercise of the option.

  

 

 

	
  Distribution:

  	
   

  	
  Shares
  of Common Stock subject to this Incentive Stock Option Award will be distributed
  as soon as practicable upon exercise.

  
	
   

  	
   

  	
   

  
	
  Designation of Beneficiary:

  	
   

  	
  A
  Beneficiary may be designated in writing to receive, in the event of death,
  any Award the Recipient is entitled to under this Incentive Stock Option.

  
	
   

  	
   

  	
   

  
	
  Non-Transferability:

  	
   

  	
  Incentive
  Stock Options are not transferable by the Recipient other than by will or the
  laws of descent and distribution and may only be exercised by the Recipient
  during the Recipient’s lifetime.  The
  designation of a Beneficiary does not constitute a transfer of an Incentive
  Stock Option.

  
	
   

  	
   

  	
   

  
	
  Incentive Stock Option Holding Period:

  	
   

  	
  The
  Recipient hereby acknowledges that in order to receive Incentive Stock Option
  tax treatment under Section 422 of the Code, the Recipient may not dispose of
  shares acquired under this Incentive Stock Option Award (i) for two (2) years
  from the Date of Grant and (ii) for one (1) year after the date the shares of
  Common Stock are transferred to the Recipient pursuant to an exercise of the
  option. The Recipient must notify the
  Company of an early disposition of Common Stock under this Incentive Stock
  Option Award.

  
	
   

  	
   

  	
   

  
	
  Tax Withholding:

  	
   

  	
  In
  the event of a disqualifying disposition, the Recipient shall remit to EFC
  Bancorp, Inc. or its Affiliates an amount sufficient to satisfy any federal,
  state and local tax withholding requirements. 
  In the event the Recipient does not remit any amount required for tax
  withholding, EFC Bancorp, Inc. has the right to withhold such sums from
  compensation otherwise due to the Recipient.

  
	
   

  	
   

  	
   

  
	
  Modification
  and Waiver:

  	
   

  	
  This
  Incentive Stock Option Award Agreement may be amended or modified,
  prospectively or retroactively; provided,
  however, that no such amendment or modification will adversely affect
  the rights of the Recipient under this Award without his or her written
  consent.

  

 

 

This Incentive Stock Option Award Agreement is subject to the terms and
conditions of the EFC Bancorp, Inc. 2000 Stock Option Plan (the A Plan).  Neither the Plan nor this Award create any
right on the part of any employee or director to continue in the employ or
service of EFS Bank, EFC Bancorp, Inc. or any Affiliates thereof.  All capitalized terms herein shall have the
same meaning as those contained in the Plan.

 

The Recipient hereby acknowledges that all decisions, determinations
and interpretations of the Board of Directors, or the Committee thereof, with
respect to the Plan and this Incentive Stock Option Award Agreement are final
and conclusive.

 

IN WITNESS WHEREOF, EFC Bancorp, Inc. has caused this Incentive Stock
Option Award Agreement to be executed, and said Recipient has hereunto set his
hand, as of the                     day
of                      

 

	
   

  	
  EFC
  BANCORP, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
   For
  the Entire Committee Administering the Plan

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  RECIPIENT:

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