Document:

traimond_apr17.htm

     

    

    

    

    

    

    

    

    

    

    

    

    

    Employment
Agreement

    

    between

    

    Flagstone
Reassurance Suisse SA

    Rue du
College 1, CH-1945 Martigny

    

    (the
“Company”)

    

    and

    

    Frederic
Traimond

    Avenue de
la Harpe 5

    1007
Lausanne

    Switzerland

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    

    
 

    This
Employment Agreement shall be subject to the competent authorities issuing the
work and residence permits required for the Employee under Swiss law, if
any.

    
      

      

      
        
          

        

      

    

    

    

    1.            
FUNCTION AND FIELD OF ACTIVITY

     

    The
Employee is employed as Chief Operating Officer for the Company. The description
of the Employee’s field of activity as well as his duties and responsibilities,
is an integral part of this Agreement (ANNEX 1).

     

    The
Company has the right to assign other duties and responsibilities to the
Employee which are in accordance with the Employee’s education and
knowledge.

     

    2.            
RELEVANCE OF ARTICLES OF INCORPORATION AND REGULATIONS

     

    The
Company’s articles of incorporation and regulations, to be issued by the board
and as amended from time to time, are an integral part of this Agreement. These
articles are to be provided to the Employee.

     

    3.            
REPORTING

     

    The
Employee shall regularly report to the Chief Executive Officer. Annex 1
contains a detailed description of the Employee’s obligations.

     

    4.            
CONFLICT OF INTERESTS

     

    The
Employee shall not engage in any activities which might lead to a conflict of
interests with respect to his position with the Company.  In
particular, the Employee shall refrain from operating, working for, or
participating in any business which competes with the Company.

     

    The
Employee shall not engage in any other business activities without a written
board resolution.  In case of non-remunerated activities a written
board resolution shall only be required in case such activities could affect the
Company’s interests or the Employee’s performance.

     

    The
participation as a shareholder in the share capital of another company which is
not in competition with the Company is authorized if no entrepreneurial
influence is exercised.  The Employee is obliged to inform the board
of transactions in the shares of other insurers/reinsurers.

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    

     

     

    5.            
TERM AND STARTING DATE

     

    This
Employment Agreement is concluded for an indefinite duration. The Employee shall
start working on or before August 1, 2007.

     

    This
Employment Agreement may be terminated by either party upon three months’
notice, effective as of the end of the month. The Company will not give notice
before July 31, 2009, other than for Cause.

     

    6.            
PROBATION PERIOD

     

    None.

     

    7.            
WORKING HOURS

     

    The
Employee shall devote his full working capacity exclusively to the
Company.

     

    8.            
SALARY

     

    The gross
salary amounts to CHF 200,000 per year, payable in 12 monthly
installments.

     

    This
amount includes all compensation for overtime.

     

    9.            
BONUS

     

    The
Employee may be considered for a bonus in the range 0 - 25 % of his gross salary
earned, which is discretionary and conditional upon his performance, conduct and
the profitability of the Company. The bonus settlement will not take place
before the year end result is approved by the general assembly.

     

    10.           EXPENSES

     

    The
Company shall cover all reasonable expenses (traveling and hotel expenses,
expenses for invitations etc.) which arise in connection with the Employee’s
activities for the Company. The Staff Policy Manual as amended from time to time
contains further rules regarding reimbursement of expenses.

     

    If the
employee take up fiscal residence in the Canton of Valais, the employer will
bear an additional Euros 10,000 per annum of such expenses and additionally will
reimburse Euros 15,000 of initial relocation expenses.

     

    11.           SOCIAL
SECURITY CONTRIBUTIONS

     

    The
Employee and the Company shall each pay half of the contributions for AHV (Old
Age and Survivors’ Insurance), IV (Invalidity Insurance), EO (Loss of Earnings)
and ALV (Unemployment Insurance). The Employee’s contributions are deducted by
the Company from his gross salary and a possible bonus payment.

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

     

    

     

    12.           PENSION
PLAN

     

    The
Employee shall participate in the Company’s pension plan. The Plan is detailed
in Staff Policy Manual.

     

    13.           ILLNESS

     

    In case
of the Employee’s inability to perform his duties under this Employment
Agreement due to illness, the Employee shall continue to receive his salary for
a maximum period of three months. In no case shall the Employee be entitled to
receive salary after the end of this Employment Agreement.

     

    14.           ACCIDENT

     

    The
Employee is insured for occupational as well as non-occupational accidents
according to the mandatory Swiss accident insurance (UVG). The contributions for
the non-occupational accident insurance shall be paid the by the Employee. The
Company may deduct the Employee’s contributions from his gross
salary.

     

    The
continuation of salary payment in case of accident is determined by
Art. 324a and 324b of the Swiss Code of Obligations. In no case shall the
Employee be entitled to receive salary after the end of this Employment
Agreement.

     

    15.           DEATH

     

    In case
of the Employee’s death the Company shall pay to his wife or his minor children,
or, in the absence of these heirs, other persons to whom the Employee fulfilled
an obligation of support, the salary for the month of death and for the three
consecutive months. Such payment shall include the Company’s obligations under
Art. 338 of the Swiss Code of Obligations.

     

    16.           VACATION

     

    The
Employee is entitled to 4 weeks of paid vacation (20 working days) per year.
Vacation is pro-rated for the first year.

     

    The
Employee shall further be entitled to receive his salary at public holidays
which apply in the Canton of Valais.

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    

     

     

    17.           CONFIDENTIALITY,
TRADE SECRETS

     

    All
manufacturing or trade secrets including customer base, technical,
organizational and financial information and all other information directly or
indirectly related to the business of the Company or to the business of any
customer of the Company, which is disclosed to the Employee by the Company or
any of its employees and which the Employee gets acquainted with during the
employment relationship with the Company, shall be treated as confidential
information. At all times, both during the employment and after the termination
thereof, the Employee shall keep such information secret and shall refrain from
disclosing it or using it in any way for his own benefit or for the benefit of
any person other than the Company.

     

    18.           INTELLECTUAL
PROPERTY RIGHTS

     

    Inventions,
designs, developments and improvements which the Employee makes while performing
his employment activity and contractual duties or to which the Employee
contributes belong to the Company, regardless of their
protectability.

     

    Inventions
and designs which the Employee makes while performing his employment activity
but not during the performance of his contractual duties or to which the
Employees contributes are assigned to the Company without further formalities.
The Employee shall inform the Company of such inventions or designs. The Company
shall inform the Employee in writing within 6 months whether it wishes to keep
the rights to the invention or the design or to release them to the Employee. In
case that the invention or the design is not released to the Employee, the
Company shall pay him a special appropriate compensation within the meaning of
Art. 332 (4) of the Swiss Code of Obligations.

     

    The
rights to works of authorship (drafts, models, plans, drawings, texts) which the
Employee creates while performing his employment activity, whether during the
performance of his contractual duties or not, including the right to uses not
yet known at this time, are transferred completely and exclusively to the
Company.

     

    19.           MISCELLANEOUS

     

    This
Agreement together with Annexes and any other signed agreements of like date
form the entire contract between the Employee and the Company. Amendments to
this Employment Agreement shall only be valid if made in writing. E-mails shall
not form any part of this contract or any amendment thereto; however documents
exchanged electronically but signed by hand shall constitute valid contracts and
amendments.

     

    Should
any provision of this Employment Agreement be fully or partially invalid or
ineffective, the other provisions or parts shall remain valid and in full force
and effect. In such event, the invalid or ineffective provision or part shall be
replaced by a provision which best reflects the economic intentions of the
parties without being invalid or ineffective, having due regard to the subject
and purposes of this Employment Agreement.

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    

     

     

    20.           APPLICABLE
LAW

     

    This
Employment Agreement is subject to Swiss law.

     

    21.           ANNEXES

     

    The
agreements and regulations attached to this Employment Agreement, as amended
from time to time, form an integral part of this Agreement.

     

    

     

    Place,
Date:  Lausanne, 17 avril 2007

     

    
       

      /s/ David
Brown                              

      David
Brown

      Director

       

       

       

      /s/ Frederic
Traimond                     

      Employee

       

       

      

                                  
                               

       

       

    

    ANNEXES

     

    Staff
Policy Manual

     

     

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    
 

    Annex 1

     

    Description
of Field of Activity as well as Duties and Responsibilities

     

    
      	
              Principal
      responsibilities will be the following:

            
	 
      
	
              Fulfill
      all aspects associated with the senior management position of COO,
      reporting to local CEO.

            
	 
      
	
              Guide
      and assist the Swiss Entity throughout the initial development in Martigny
      and Zurich in close cooperation with local CEO and CUO of Swiss operation
      and CEOI/CUOI:

            
	 
      	
              ●

            	
              This
      will require dealing with many varied tasks as they appear - all
      associated with a start up operation.

            
	 
      
	
              Assist
      the local CEO and the Board in development of strategy for Swiss
      operations:

            
	 
      	
              ●

            	
              Analysis
      of the European underwriting opportunities and other business ideas in
      collaboration with the underwriting team (new lines of business and
      acquisitions).

            
	 
      	
              ●

            	
              Assist
      and coordinate business planning in close cooperation with local CEO, CUO
      and CFO.

            
	 
      
	
              Contribute
      to the overall business production initiative:

            
	 
      	
              ●

            	
              Support
      Underwriting and Actuarial department in the business
      development.

            
	 
      	
              ●

            	
              Ensure
      we create the correct platform in Martigny for each lines of Business -
      for example Aviation and Space under CUO and Andreas Peter’s
      guidance.

            
	 
      
	
              Assist
      and monitor different risk aspects of the Entity:

            
	 
      	
              ●

            	
              Head
      of Risk Management, Finance and Operations Committee.

            
	 
      	
              ●

            	
              Implementation
      of the local Risk Management and particularly the Swiss Solvency
      Test.

            
	 
      	
              ●

            	
              Reserving
      process and quarterly estimations.

            
	 
      
	
              Develop
      and guide local HR in close cooperation with CEO and HR Manager of the
      Group:

            
	 
      	
              ●

            	
              Ensure
      the correct implementation of Group rules and
    methodologies.

            
	 
      	
              ●

            	
              Coordinate
      the hiring requirements for Switzerland.

            
	 
      
	
              Develop
      and guide in procedurising the areas of monitoring, reporting and finance
      for the Swiss operations:

            
	 
      	
              ●

            	
              Ensure
      Swiss offices (Martigny and Zurich) and their employees are fully up to
      date on the current tools available and all systems used within
      Flagstone.

            
	 
      	
              ●

            	
              Coordinate
      any onsite training that may be
required.

            

    

    

     

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

     

    The above
list is purely indicative and allocated tasks can evolve along with the needs of
the Company.

     

    Martigny,
1st November 2007

     

    /s/

     

    -------ENDS-------Unassociated Document

     

     

     

    
      THIS AMENDMENT AGREEMENT is
made as of the 1st Day of
December, 2007 and is supplemental to between the Employment Agreement
made as of 17th Day of April, 2007, made by and among Flagstone Reassurance
Suisse SA (the “Company”) and Frederic Traimond (the “Employee”) (the “Original
Agreement”).

       

      WHEREBY
IT IS AGREED as follows:

       

       

      1)           Definitions and
Interpretation

       

      “Effective Date”, means 1st
January, 2008.

       

      Any term
not defined in this Amendment Agreement shall have the meaning as set out in the
Original Agreement.

       

      

      2)           Amendment

       

      With
effect from the Effective Date, the amendments are as follows:

       

      Section
16 of the Original Agreement shall be deleted and replaced with the following
new Section 16.

       

      
        
          
            
              	
                      16.

                    	
                      Vacation

                    	
                      The
      Employee is entitled to 5 weeks paid vacation (25 working days) per year.
      Vacation is pro-rated for the first year.

                       

                      The
      Employee shall further be entitled to receive his salary at public
      holidays which apply in the Canton of the
  Valais.

                    

            

          

        

      

      

       

       

      3)           Whole
Agreement

       

      
        
          	
                  i)

                	
                  Except
      as specifically amended hereby, the Original Agreement shall continue in
      full force and effect in accordance with the provisions hereof on the date
      hereof and nothing herein contained shall be construed as waiver or
      modification of existing rights under the Original Agreement, except as
      such rights are expressly modified hereby.

                   

                
	
                  ii)

                	
                  This
      Amendment Agreement constitutes an entire agreement and understanding of
      the parties with respect to the subject matter hereof. The Amendment
      Agreement shall be governed by and construed in accordance with the laws
      of Switzerland.

                

        

      

       

      

      IN WITNESS WHEREOF the parties
hereto have set their hands the date first above written.

      

      
        
          
            
              
                
                  
                    	
                            Flagstone
      Réassurance Suisse SA

                             

                             

                             

                          	 
      
	 /s/
      Guy Swayne	 
      	 /s/
      Frédéric
      Traimond	 
	
                            Guy
      Swayne

                            CEO

                          	
                            Frédéric
      Traimond

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