Document:

Exhibit 10.6.16

 

PHH CORPORATION

 

2011 PERFORMANCE RESTRICTED STOCK UNIT

AWARD NOTICE

 

We are pleased to notify you that PHH Corporation (the “Company”) has awarded you this 2011 Performance Restricted Stock Unit Award.  The Performance Restricted Stock Unit Award represents the Company’s unfunded and unsecured promise to issue shares of the Company’s Stock at a future date subject to the terms and conditions of this Performance Restricted Stock Unit Award Notice, the attached Performance Restricted Stock Unit Award Agreement (the “Agreement”) and the PHH Corporation 2005 Equity and Incentive Plan, as amended (the “Plan”).  This Performance Restricted Stock Unit Award Notice (the “Award Notice”) constitutes part of and is subject to the terms and provisions of the Agreement and the Plan.  Capitalized terms used but not defined in this Award Notice shall have the meanings set forth in the Agreement or the Plan.

 

	
Grantee:
    	
[Name]
    
	
 
    	
 
    
	
Participant   #:
    	
[ID]
    
	
 
    	
 
    
	
Grant   Date:
    	
____________, 2011
    
	
 
    	
 
    
	
Target   Shares:
    	
[_________]
    
	
 
    	
 
    
	
Earned   Shares:
    	
The Earned Shares are   the shares of Stock determined by multiplying the Target Shares by the   Achieved Percentage based on the Target Performance Level achieved by the   Company for the Target Measurement Period as described in the chart below,   and as determined by the Human Capital and Compensation Committee (the   “Committee”) in its discretion.
    
	
 
    	
 
    
	
Settlement:
    	
Subject to the terms of   the Agreement and the Plan, the Earned Shares will be paid on or after   January 1, 2014, and on or before April 30, 2014 (the date of payment is   referred to herein as the “Settlement Date”).    Except as provided in the Award Agreement, failure to achieve any   Targeted Performance Level during the Target Measurement Period shall result   in the forfeiture of your rights under this Award and termination of the   Agreement.
    
	
 
    	
 
    
	
Target Measurement Period   (“TMP”) – October 1,  2011 through   December 31, 2013
    

 

[continued on the next page]

 

 

Targeted Performance Levels

 

	
Targeted   Performance
   Level
    	
 
    	
Cumulative   Core Earnings
   (Pre-Tax) for the TMP1
    	
 
    	
Achieved
   Percentage
    	
 
    
	
Threshold 
    	
 
    	
At least $[***] but   less than $[***]
    	
 
    	
50%
    	
 
    
	
Target
    	
 
    	
At least $[***] but   less than $[***]
    	
 
    	
100%
    	
 
    
	
Outstanding 
    	
 
    	
At least $[***]
    	
 
    	
150%
    	
 
    

 

1The target levels of cumulative Core Earnings (Pre-Tax) will be reduced by the actual level of Core Earnings (Pre-Tax) achieved for the 2011 fiscal year through September 30, 2011.

 

The Achieved Percentage for a level of achievement of the cumulative Core Earnings (Pre-Tax) target as certified by the Committee that is between the levels set forth in the table above and is above the “Threshold” level will be determined based on straight-line interpolation.  There will be no payment for performance below the “Threshold” level.  No payment will be made in excess of the Achieved Percentage at the “Outstanding” level.

 

For purposes of this Award, “Core Earnings (Pre-Tax)” means pre-tax income after non-controlling interest for the Company and its consolidated subsidiaries excluding unrealized changes in fair value of the mortgage servicing rights of the Company and its consolidated subsidiaries that are based upon projections of expected future cash flows and prepayments as well as realized and unrealized changes in the fair value of derivatives that are intended to offset changes in the fair value of mortgage servicing rights.

 

The Committee may exercise negative discretion to reduce the Achieved Percentage and the amount payable under this Award prior to the earlier of payment of the Award or Change in Control.  Such discretion may be exercised based on the Committee’s subjective determination (or the Committee’s determination based upon a recommendation of the Company’s management) of the extent to which the Grantee has achieved such individual goals for the Measurement Period, if any, as the Committee may establish or based on any other factors the Committee deems necessary or appropriate in its sole and absolute discretion.

 

We congratulate you on the recognition of your importance to our organization and its future.

 

	
 
    	
PHH CORPORATION
    
	
 
    	
 
    
	
 
    	
 
    
	
 
    	
By:
    	
 
    	
 
    
	
 
    	
 
    
	
 
    	
Name: Jerome J. Selitto
    
	
 
    	
Title:  President & CEO, PHH Corporation
    
	
 
    	
Date:  ____________, 2011
    

 

RETAIN THIS NOTIFICATION AND YOUR AWARD AGREEMENT WITH

YOUR IMPORTANT DOCUMENTS AS A RECORD OF THIS AWARD.

 

__________________________

[***] INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

 

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PHH CORPORATION

PERFORMANCE RESTRICTED STOCK UNIT AWARD AGREEMENT

 

PHH Corporation, a Maryland corporation (the “Company”) has granted to the individual (the “Grantee”) named in the Performance Restricted Stock Unit Award Notice to which this Performance Restricted Stock Unit Award Agreement (the “Agreement”) is attached, a Performance Restricted Stock Unit Award relating to the common stock, par value $0.01 per share, of the Company, subject to the terms and conditions set forth in the Award Notice and this Agreement.  This Performance Restricted Stock Unit Award (the “Award”) has been granted pursuant to the PHH Corporation Amended and Restated 2005 Equity and Incentive Plan, as amended (the “Plan”).

 

WHEREAS, the Human Capital and Compensation Committee of the Board of Directors of the Company (the “Committee”) has the authority under and pursuant to the Plan to grant and establish the terms of awards to eligible employees of the Company and its Subsidiaries; and

 

WHEREAS, the Committee desires to grant an Award to the Grantee, subject to the terms and conditions of the Plan, the Award Notice and this Agreement.

 

In consideration of the provisions contained in this Agreement, the Company and the Grantee agree as follows:

 

1.                                    The Plan.  The Award granted to the Grantee hereunder is pursuant to the Plan.  The terms of the Plan are hereby incorporated in this Agreement.  Terms used in this Agreement which are not defined in this Agreement shall have the meanings used or defined in the Plan.

 

2.                                    Grant of Award.

 

a.                                     Subject to the terms and conditions set forth in the Plan and this Agreement, the Grantee is hereby granted this Award.

 

b.                                    The Grantee is not required to make any monetary payment (other than applicable tax withholding, if any, and payment of the par value of the Stock, if required by law) as a condition to receiving shares of Stock issued upon settlement of the Award.

 

c.                                     If the Grantee does not sign a restrictive covenant agreement in the form presented by the Company within forty-five (45) days after the Grant Date, the Award shall be forfeited.

 

3.                                    Termination of Employment.  Notwithstanding any other provision of the Plan to the contrary, except as provided in Section 4b. and 4c., upon the termination of the Grantee’s employment with the Company and its Subsidiaries for any reason whatsoever on or before December 31, 2013, the Award shall immediately and automatically terminate and no payment will be made.

 

 

4.                                    Settlement.

 

a.                                     Issuance of Shares of Stock.  On the Settlement Date, the Company shall issue to the Grantee the Earned Shares, as described in the Award Notice, after any adjustments as provided under Section 5 of the Plan; provided, however, that the Grantee shall remain required to remit to the Company such amount that the Company determines is necessary to meet all required minimum withholding taxes.

 

b.                                    If the Grantee’s employment is terminated by the Company and its Subsidiaries without Cause (as defined in this subsection b.), the Award shall become vested in accordance with the following schedule:

 

	
Date of   Termination of
   Employment Without Cause
    	
 
    	
Percent   Vested
    
	
Before January 1, 2012
    	
 
    	
0%
    
	
On or after January 1,   2012, but before January 1, 2013
    	
 
    	
25%
    
	
On or after January 1,   2013, but before December 31, 2013
    	
 
    	
50%
    
	
December 31, 2013
    	
 
    	
100%
    

 

The portion of the Award payable on the Settlement Date will be the number of Earned Shares multiplied by the percent vested from the above chart.  All other Earned Shares will be forfeited as of the Settlement Date, except as otherwise expressly provided by the Committee.  Notwithstanding the foregoing, in the event the Grantee violates any non-competition, non-solicitation, non-disclosure, or other restrictive covenant agreement with the Company or its Subsidiaries  prior to the Settlement Date, then the Grantee shall not be vested in any portion of the Earned Shares and the entire Award will be forfeited.

 

For purposes of this Award, “Cause” means any one of the following: (1) a material failure of the Grantee to substantially perform the Grantee’s duties with the Company or its Subsidiaries (other than failure resulting from incapacity due to physical or mental illness); (2) any act of fraud, misappropriation, dishonesty, embezzlement or similar conduct against, or relating to the assets of, the Company or its Subsidiaries; (3) conviction (or plea of nolo contendere) of a felony or any crime involving moral turpitude; (4) repeated instances of negligence in the performance of the Grantee’s job or any instance of gross negligence in the performance of the Grantee’s duties as an employee of the Company or one of its Subsidiaries; (5) any breach by the Grantee of any fiduciary obligation owed to the Company or any Subsidiary or any material element of the Company’s Code of Ethics, the Company’s Code of Conduct or other applicable workplace policies; or (6) failure by the Grantee to perform Grantee’s job duties for the Company or any Subsidiary to the best of Grantee’s ability and in accordance with reasonable instructions and directions from the Board or its designee, and the reasonable workplace policies and procedures established by the Company or any Subsidiary, as applicable, from time to time.

 

c.                                     Change in Control.  Upon the occurrence of a Change in Control that occurs on or before December 31, 2013 and while the Grantee is employed with the Company or its subsidiaries, the Grantee will become vested in the portion of the Change in Control Payment as specified in the chart below:

 

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Date of   Change in Control
    	
 
    	
Percent   Vested
    
	
Before January 1, 2012
    	
 
    	
0%
    
	
On or after January 1,   2012, but before January 1, 2013
    	
 
    	
25%
    
	
On or after January 1,   2013, but before December 31, 2013
    	
 
    	
50%
    
	
December 31, 2013
    	
 
    	
100%
    

 

For this purpose, the “Change in Control Payment” is the level of Core Earnings (Pre-Tax) achieved as of the date of the Change in Control expressed as a percentage of Threshold Performance, multiplied by the Target Shares.  For this purpose, “Threshold Performance” is $[***] minus the actual level of Core Earnings (Pre-Tax) achieved for the 2011 fiscal year through September 30, 2011.  The vested portion of the Change in Control Payment will be paid on a date selected by the Company within ninety (90) days following the date of the Change in Control.  The unvested portion of the Change in Control Payment shall be forfeited upon payment of the vested portion, unless otherwise expressly provided by the Committee in writing.

 

d.                                    Certificate Registration.  The certificate for the shares issued in settlement of the Award shall be registered in the name of the Grantee, or, if applicable, in the names of the Grantee’s heirs.

 

e.                                     Restrictions on Grant of the Award and Issuance of Shares.  The grant of this Award and issuance of shares of Stock upon settlement of the Award shall be subject to and in compliance with all applicable requirements of federal, state or foreign law with respect to such securities.  No shares of Stock may be issued hereunder if the issuance of such shares would constitute a violation of any applicable federal, state or foreign securities laws or other law or regulations or the requirements of any stock exchange or market system upon which the Stock may then be listed.  The inability of the Company to obtain from any regulatory body having jurisdiction the authority, if any, deemed by the Company’s legal counsel to be necessary to the lawful issuance of any shares subject to the Award shall relieve the Company of any liability in respect of the failure to issue such shares as to which such requisite authority shall not have been obtained.  As a condition to the settlement of the Award, the Company may require the Grantee to satisfy any qualifications that may be necessary or appropriate, to evidence compliance with any applicable law or regulation and to make any representation or warranty with respect thereto as may be requested by the Company.

 

f.                                        Fractional Shares.  The Company shall not be required to issue fractional shares upon the settlement of the Award.

 

g.                                     Dividend Equivalents.  No dividend equivalents will be paid with respect to the Award.

 

5.                                    Tax Obligations.  As a condition to the granting of the Award and the settlement thereof, the Grantee agrees to remit to the Company or any of its applicable Subsidiaries such sum as may be necessary to discharge the Company’s or such Subsidiary’s obligations with respect to any tax, assessment or other governmental charge imposed on property or income received by the Grantee pursuant to this Agreement and the Award.  Accordingly, the Grantee agrees to remit to

_______________________

[***] INDICATES MATERIAL THAT HAS BEEN OMITTED AND FOR WHICH CONFIDENTIAL TREATMENT HAS BEEN REQUESTED. ALL SUCH OMITTED MATERIAL HAS BEEN FILED WITH THE SECURITIES AND EXCHANGE COMMISSION PURSUANT TO RULE 24b-2 PROMULGATED UNDER THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED.

 

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the Company or an applicable Subsidiary any and all required minimum withholding taxes.  To satisfy such obligation, Grantee agrees to have the Company withhold a number of whole shares of Stock otherwise deliverable to Grantee in settlement of the Award having a Fair Market Value, as of the date on which the tax withholding obligations arise, not in excess of the amount of such tax withholding obligations determined by the applicable minimum statutory withholding rates.

 

6.                                    No Rights to Continued Employment; Loss of Office.  Neither this Agreement nor the Award shall be construed as giving the Grantee any right to continue in the employ of the Company or any of its Subsidiaries, or shall interfere in any way with the right of the Company to terminate such employment.  Notwithstanding any other provision of the Plan, the Award, this Agreement or any other agreement (written or oral) to the contrary, for purposes of the Plan and the Award, a termination of employment shall be deemed to have occurred on the date upon which the Grantee ceases to perform active employment duties for the Company following the provision of any notification of termination or resignation from employment, and without regard to any period of notice of termination of employment (whether expressed or implied) or any period of severance or salary continuation.  Notwithstanding any other provision of the Plan, the Award, this Agreement or any other agreement (written or oral) to the contrary, the Grantee shall not be entitled (and by accepting an Award, thereby irrevocably waives any such entitlement), by way of compensation for loss of office or otherwise, to any sum or other benefit to compensate the Grantee for the loss of any rights under the Plan as a result of the termination or expiration of an Award in connection with any termination of employment.  No amounts earned pursuant to the Plan or any Award shall be deemed to be eligible compensation in respect of any other plan of the Company or any of its Subsidiaries.

 

7.                                    Rights as a Stockholder.  The Grantee shall have no rights as a stockholder with respect to any shares which may be issued in settlement of the Award until the date of the issuance of a certificate for such shares (as evidenced by the appropriate entry on the books of the Company or of a duly authorized transfer agent of the Company).  No adjustment shall be made for dividends, distributions or other rights for which the record date is prior to the date such certificate is issued, except as provided Section 5 of the Plan.

 

8.                                    Clawback.  This Award, and any stock issued or cash paid pursuant to this Award, is expressly subject to any “clawback policy” adopted by the Board or its designee.

 

9.                                    Legends. The Company may at any time place legends referencing any applicable federal, state or foreign securities law restrictions on all certificates representing shares of Stock issued pursuant to this Agreement.  The Grantee shall, at the request of the Company, promptly present to the Company any and all certificates representing shares acquired pursuant to this Agreement in the possession of the Grantee in order to carry out the provisions of this Section.

 

10.                            Nontransferability.  Prior to the issuance of shares of Stock pursuant to this Agreement, neither this Agreement nor any shares subject to this Agreement shall be subject in any manner to anticipation, alienation, sale, exchange, transfer, assignment, pledge, encumbrance, or garnishment by creditors of the Grantee, except transfer by will or by the laws of descent and distribution.  All rights with respect to the Agreement shall be exercisable during the Grantee’s lifetime only by the Grantee or the Grantee’s guardian or legal representative.

 

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11.                            Amendments.  The Committee may amend this Agreement at any time; provided, however, that no such amendment may adversely affect the Grantee’s rights under this Agreement without the consent of the Grantee, except to the extent such amendment is reasonably determined by the Committee in its sole discretion to be necessary to comply with applicable law or to prevent a detrimental accounting impact.  No amendment or addition to this Agreement shall be effective unless in writing.

 

12.                            Section 409A.  This Award is intended to comply with, or otherwise be exempt from, Section 409A of the Code.  This Award shall be administered, interpreted and construed in a manner consistent with such Code section.  Should any provision of this Agreement or the Award be found not to comply with, or otherwise be exempt from, the provisions of Section 409A of the Code, it shall be modified and given effect, in the sole discretion of the Committee and without requiring the Grantee’s consent (notwithstanding the provisions of Section 10 above), in such manner as the Committee determines to be necessary or appropriate to comply with, or to effectuate an exemption from, Section 409A of the Code.

 

13.                            Notices.  Any notice required or permitted under this Agreement shall be deemed given when delivered personally, or when deposited in a United States Post Office, postage prepaid, addressed, as appropriate, to the Grantee at the last address specified in the Grantee’s employment records, or such other address as the Grantee may designate in writing to the Company, or the Company, Attention: General Counsel, or such other address as the Company may designate in writing to the Grantee.

 

14.                            Binding Effect.  This Agreement shall inure to the benefit of the successors and assigns of the Company and, subject to the restrictions on transfer set forth herein, be binding upon the Grantee and the Grantee’s heirs, executors, administrators, successors and assigns.

 

15.                            Failure to Enforce Not a Waiver.  The failure of the Company to enforce at any time any provision of this Agreement shall in no way be construed to be a waiver of such provision or of any other provision hereof.

 

16.                            Integrated Agreement.  The Award Notice, this Agreement and the Plan constitute the entire understanding and agreement of the Grantee and the Company with respect to the subject matter contained herein or therein and supersedes any prior agreements, understandings, restrictions, representations, or warranties among the Grantee and the Company with respect to such subject matter other than those as set forth or provided for herein or therein.  To the extent contemplated herein or therein, the provisions of the Award Notice and the Agreement shall survive any settlement of the award and shall remain in full force and effect.

 

17.                            Governing Law.  This Agreement and the legal relations between the parties shall be governed by and construed in accordance with the internal laws of the State of Maryland, without effect to the conflicts of laws principles thereof.

 

18.                            Authority.  The Committee shall have full authority to interpret and construe the terms of the Plan, the Award Notice, and this Agreement.  The determination of the Committee as to any such matter of interpretation or construction shall be final, binding and conclusive on all parties.

 

- 5 -Exhibit 10.7

 

INVESTMENT MANAGEMENT AGREEMENT

 

WHITE MOUNTAINS ADVISORS LLC, a Delaware limited liability company (the “Advisor”), having an address at 200 Hubbard Road, Guilford, Connecticut 06437, and OneBeacon Insurance Group, Ltd., an exempted limited liability company organized under the laws of Bermuda (the “Client”), having an address at One Beacon Lane, Canton, Massachusetts 02021, and each affiliate company of the Client listed on Schedule B, and each having an address at One Beacon Lane, Canton, Massachusetts 02021, or which hereinafter becomes a party to this Agreement (each, an “Affiliated Company”, and collectively, the “Affiliated Companies”), hereby enter into this Investment Management Agreement (this “Agreement”), dated as of October 1, 2010 and hereby agree that the Advisor shall act as discretionary advisor with respect to certain assets of the Client and the Affiliated Companies described below (the “Investment Account”) on the following terms and conditions:

 

1.                                      Investment Account.  The Investment Account shall consist of the cash and securities of the Client and the Affiliated Companies managed by the Advisor pursuant to this Agreement.

 

2.                                      Authority.  The Client and each Affiliated Company hereby appoint the Advisor as advisor for the portion of the Investment Account comprised of its investment assets. Except as may be separately agreed in writing among the Advisor, the Client and any Affiliated Company from time to time, the Advisor hereby agrees to direct the investments in the Investment Account in accordance with the investment guidelines agreed upon by the Client, each Affiliated Company and the Advisor from time to time (the “Standard Guidelines”).  Any other agreement by the Advisor, and the Client or an Affiliated Company to manage investment assets in a manner deviating from the Standard Guidelines shall be in writing.  The board of directors (or other similar governing body) of the Client and each Affiliated Company shall oversee the activities of the Advisor pursuant to this Agreement and shall retain ultimate authority over the Investment Account, in each case, in relation to their respective investment assets. In addition, the Advisor agrees to provide treasury management advisory services specific to the Investment Account (“Treasury Management Services”), as directed by the Client or any Affiliated Company.  The Treasury Management Services include, without limitation, (i) executing investment transactions to support short-term treasury cash requirements, (ii) settling inter-company and dividend treasury transactions with cash and securities, (iii) settling quarterly tax liability payments from the Investment Account, (iv) providing preliminary valuation for securities supporting treasury transactions, (v) assisting the Client or any Affiliated Company in evaluating securities lending programs administered by custodians designated by the Client or such Affiliated Company and acceptable to the Advisor, and (vi) collaborating with the Client or any Affiliated Company to provide treasury transaction support to custodians and accounting servicing providers designated by the Client or such Affiliated Company and acceptable to the Advisor.

 

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3.                                      Advisor’s Discretionary Authority.  Subject to Section 2, the Advisor shall have full discretion and authority as agent and attorney-in-fact for the Client and each Affiliated Company: (a) to make all investment decisions in respect of the Investment Account on behalf of the Client and the Affiliated Companies and, except as otherwise provided in this Agreement, at the sole risk of the Client and the Affiliated Companies; (b) to buy, sell, exchange, convert, liquidate or otherwise trade in respect of the Investment Account in any stock, bond or other security or investment, including without limitation private investment funds, hedge funds, and other pooled investment vehicles (such private investment funds, hedge funds, and other pooled investment vehicles collectively referred to as “Funds”); (c) to facilitate the subscription for, redemption or transfer of interests in Funds (including but not limited to performing such acts and executing such documents as may be necessary to subscribe or redeem interests in Funds) and (d) in furtherance of the foregoing, to do anything which the Advisor shall deem requisite, appropriate or advisable in connection therewith, including, without limitation, the placing of orders with respect to, and arrangement for, any of the foregoing, and the selection of such brokers, dealers, sub-advisors and others as the Advisor shall determine in its absolute discretion.  The Advisor will be responsible for engaging, contracting with, monitoring and terminating sub-advisors; however, no sub-advisor shall be given discretionary authority over the Investment Account without the prior approval of the Client, and to the extent affecting the investment assets of any Affiliated Company, such Affiliated Company.

 

4.                                      Liability.  In the performance of its services, the Advisor will not be liable for any error in judgment or any acts or failures to act except those resulting from the Advisor’s gross negligence, willful misconduct or malfeasance.  Nothing herein shall in any way constitute a waiver or limitation of any right of any person under any applicable U.S. federal or state securities laws.  The Advisor shall have no responsibility or liability whatsoever in respect of assets outside the Investment Account.

 

5.                                      Custody.  Investment Account assets shall be held in one or more separately identified accounts in the custody of one or more banks, trust companies, brokerage firms or other entities designated by the Client and each Affiliated Company, and acceptable to the Advisor.  The Advisor will communicate its investment purchase, sale and delivery instructions directly with the appropriate custodian or other qualified depository.  The Client and each Affiliated Company shall be responsible for its respective custodial arrangements and the payment of all related custodial charges and fees, and the Advisor shall have no responsibility or liability with respect to custody arrangements or the acts, omissions or other conduct of the custodians.

 

6.                                      Brokerage.  When placing orders for the execution of transactions for the Investment Account, the Advisor may allocate all transactions to such brokers or dealers, for execution on such markets, at such prices and commission rates, as are selected by the Advisor in its sole discretion.  In selecting brokers or dealers to execute transactions, the Advisor need not solicit competitive bids and does not have an obligation to seek the lowest available commission cost.  It is not the Advisor’s practice to negotiate “execution only” commission rates, and, in negotiating commission rates, the Advisor shall take into account the financial stability and reputation of brokerage firms and brokerage and research services provided by such brokers.  The Client or any Affiliated Company may be deemed to be paying for research provided or paid for by the broker which is included in the commission rate although the Client or such Affiliated Company may not, in any particular instance, be the direct or indirect beneficiary of the research services provided.  Research

 

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furnished by brokers may include, but is not limited to, written information and analyses concerning specific securities, companies or sectors; market, finance and economic studies and forecasts; certain financial publications; statistics and pricing services; discussions with research personnel; and certain software and data bases utilized in the investment management process.  The Client and each Affiliated Company acknowledge that since commission rates are generally negotiable, selecting brokers on the basis of considerations which are not limited to applicable commission rates may at times result in higher transaction costs than would otherwise be obtainable.

 

The Advisor is hereby authorized to, and the Client and each Affiliated Company acknowledges that the Advisor may, aggregate orders on behalf of the Investment Account with orders on behalf of other clients of the Advisor.  In such event, the allocation of the securities purchased or sold and the expenses incurred in the transaction shall be made in a manner that the Advisor considers to be fair and equitable to all of its clients, including the Client and the Affiliated Companies, and that is consistent with the allocation policies and procedures adopted and implemented by the Advisor, copies of which will be made available to clients upon request.

 

7.                                      Representations and Warranties.

 

a)             The Client and each Affiliated Company represents, warrants and agrees that:

 

(i)                      it has full legal power and authority to enter into this Agreement;

 

(ii)                  the appointment of the Advisor hereunder is permitted by the Client’s or such Affiliated Company’s governing documents and has been duly authorized by all necessary corporate or other action;

 

(iii)               it will indemnify the Advisor and hold it harmless against any and all losses, costs, claims and liabilities which the Advisor may suffer or incur arising out of any material breach of its representations and warranties herein;

 

(iv)               it is not (a) an employee benefit plan, (b) an IRA, (c) a “benefit plan investor” subject to the Employee Retirement Income Security Act of 1974, as amended, or Section 4975 of the Internal Revenue Code of 1986, as amended, or (d) an entity in which the participation by ‘benefit plan investors” is “significant’, as those terms are defined in regulations issued by the U.S. Department of Labor; and

 

(v)                  it understands that the Advisor will be relying upon the representations and information provided herein or in connection herewith by the Client and/or the Affiliated Companies in completing and entering into subscription agreements on behalf of the Investment Account.

 

b)             The Advisor represents, warrants and agrees that:

 

(i)                      it has full legal power and authority to enter into this Agreement;

 

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(ii)                   it is registered as an investment adviser with the Securities and Exchange Commission pursuant to the Investment Advisers Act of 1940, as amended (the “Advisers Act”);

 

(iii)                entering into this Agreement is permitted by the Advisor’s governing documents and has been duly authorized by all necessary corporate or other action;

 

(iv)               it will indemnify the Client and each Affiliated Company and hold it harmless against any and all losses, costs, claims and liabilities which the Client and/or such Affiliated Company may suffer or incur arising out of any material breach of any representations and warranties of the Advisor;

 

(v)                  it has established Anti-Money Laundering Policy & Procedures pursuant to Section 352 of the USA Patriot Act; and,

 

(vi)               it endeavors to value all securities at fair market value in a manner determined by the Advisor to be consistent with (1) its Valuations Policies and Procedures, as may be amended from time to time, and (2) industry practice.  A copy of these policies and procedures is available to clients upon request. The Advisor will not serve as the official pricing agent with respect to the Investment Account but may provide recommendations regarding fair valuation, if the Client or an Affiliated Company so requests.

 

8.                                      Reports.  The Advisor shall provide the Client and each Affiliated Company with reports on the status of the Investment Account on a monthly basis.  All records maintained pursuant to this Agreement shall be subject to examination by the Client and, as it relates to its own investment assets, each Affiliated Company, and by persons authorized by it, or by appropriate governmental authorities, at all times upon reasonable notice.  The Advisor shall provide copies of trade tickets, custodial reports and other records that the Client and/or any Affiliated Company shall reasonably require for accounting or tax purposes.

 

9.                                      Management Fee, Treasury Management Fee and Expenses.

 

(a) The Advisor will be paid a quarterly management fee and Treasury Management Fee (the “Management Fee”) for its investment advisory and Treasury Management Services provided hereunder, determined in accordance with Schedule A to this Agreement.  For purposes of Schedule A, the Management Fee shall be calculated treating the Investment Account as a single pool.  The Management Fee shall be borne by the Client and the Affiliated Companies pro rata based on respective Investment Account assets.  During the term of this Agreement, the Management Fee shall be billed and payable in arrears on a quarterly basis within sixty (60) days after the last day of each calendar quarter based upon the value of the Investment Account as of the last day of the said calendar quarter.  The Management Fee shall be pro-rated for any partial quarter.  Capital inflows and outflows will be time-weighted so that the Management Fee will be charged for only the period of time such assets are actually managed by the Advisor.  In the event that the

 

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Management Fee is to be paid by the custodian out of the Investment Account, the Client and/or the relevant Affiliated Company will provide written authorization to the custodian.

 

(b) The Client or an Affiliated Company shall be responsible for all expenses incurred directly in connection with transactions effected on behalf of the Client or such Affiliated Company pursuant to this Agreement.  These expenses shall include but are not limited to (i) custodial fees; (ii) PAM accounting service fees, (iii) Charles River (or other) compliance service fees, (iv) investment expenses such as commissions; and (v) other expenses reasonably related to the purchase, sale or transmittal of Investment Account assets, provided that the Advisor shall be responsible for research fees and expenses.

 

(c) Sub-advisory management or performance fees (“Sub-advisor Fees”), if any, will be borne by the Client and/or the affected Affiliated Companies, as appropriate, provided that said fees have been approved in advance by the Client and/or the affected Affiliated Company.  No Management Fee shall accrue on any assets with respect to which Sub-advisor Fees are paid.  At the Advisor’s discretion, Sub-advisor Fees may be structured to be paid directly to the sub-advisor by the Client or Affiliated Companies or be paid by the Advisor and reimbursed by the Client or Affiliated Companies without any markup.  Any Management Fees incurred in connection with transactions conducted by the Advisor with regard to interests in Funds will be borne by the Client or the affected Affiliated Companies.

 

10.                               Confidential Relationship.  All information and advice furnished by any party to another party pursuant to this Agreement shall be treated by the receiving party as confidential and shall not be disclosed to third parties except as required by law.

 

11.                               Assignment.  This Agreement may not be assigned (within the meaning of the Advisers Act) by any party without the written consent of the other party, and any assignment without such consent shall automatically cause the termination hereof.

 

12.                               Directions to the Advisor.  All directions by or on behalf of the Client or an Affiliated Company to the Advisor shall be in writing and may be delivered in any manner permitted by Section 16.  The Advisor (i) shall be fully protected in relying upon any such writing that the Advisor believes to be genuine and to be signed or presented or sent by the proper person or persons (ii) shall be under no duty to make any investigation or inquiry as to any statement contained therein and (iii) may accept the same as conclusive evidence of the truth and accuracy of the statements therein contained.

 

13.                               Services to Other Clients.  It is understood that the Advisor acts as investment advisor to other clients and may give advice and take action with respect to such clients that differs from the advice given or the action taken with respect to the Investment Account.  Nothing in this Agreement shall restrict the right of the Advisor, its members, managers, officers, employees or affiliates to perform investment management or advisory services for any other person or entity, and the performance of such service for others shall not be deemed to violate or give rise to any duty or obligation to the Client and/or the Affiliated Companies.

 

14.                               Investment by the Advisor for Its Own Account.  Nothing in this Agreement shall limit or restrict the Advisor or any of its members, managers, officers, employees or affiliates from

 

5

 

buying, selling or trading any securities for its or their own account or accounts.  The Client and each Affiliated Company acknowledges that the Advisor and its members, managers, officers, employees, affiliates and other clients may at any time have, acquire, increase, decrease or dispose of securities which are at or about the same time acquired or disposed of for the account of the Client or an Affiliated Company.  The Advisor shall have no obligation to purchase or sell for the Investment Account or to recommend for purchase or sale by the Investment Account any security that the Advisor or its members, managers, officers, employees or affiliates may purchase or sell for itself or themselves or for any other client.

 

15.                               Proxies.  Subject to any other written instructions of the Client or any Affiliated Company, the Advisor is hereby appointed as the agent and attorney-in-fact of the Client and each Affiliated Company in its discretion to vote, convert or tender in an exchange or tender offer any securities in the Investment Account; to execute proxies, waivers, consents and other instruments with respect to such securities; to endorse, transfer or deliver such securities; and to participate in or consent to any plan of reorganization, merger, combination, consolidation, liquidation or similar plan with reference to such securities.  The Advisor shall not incur any liability to the Client or any Company Affiliate by reason of any exercise of, or failure to exercise, any such discretion.

 

16.                               Notices.  All notices and instructions with respect to securities transactions or any other matters contemplated by this Agreement shall be deemed duly given when actually received by the intended party in writing, via facsimile, or e-mail or by first-class mail to the following addresses: (a) if to the Advisor, at its address set forth above, Attention: Chief Financial Officer, if by facsimile to 203.458.0754 and if by e-mail, mplourde@whitemountainsadvisors.com or (b) if to the Client or any Affiliated Company, at its address set forth above, Attention: Chief Financial Officer, if by facsimile to 781.332.7704, and if by e-mail, pmcdonough@onebeacon.com.  Any of the Advisor, the Client or an Affiliated Company may change its physical address, facsimile number or e-mail address or specify a different manner of addressing itself by giving notice of such change in writing to the other party.

 

17.                               Joining and Severing Affiliated Companies.  From time to time while this Agreement remains in effect, the Client may cause any other of its affiliates to become an Affiliated Company hereunder by executing a written agreement among the Client, the Advisor and such affiliate in a form reasonably acceptable to each of them, after which the affiliate shall, for all purposes, be treated as an “Affiliated Company” hereunder, including, without limitation, granting the authorities, making the representations and warranties and accepting the obligations of an Affiliated Company in this Agreement.  From time to time, the Client and/or the Advisor may sever any Affiliated Company from this Agreement by executing a written agreement among the Client, the Advisor and such Affiliated Company in a form reasonably acceptable to each of them, after which the Affiliated Company shall no longer be treated as being party to this Agreement.  The Advisor will periodically update Schedule B to reflect the addition or removal of Affiliated Companies.

 

18.                               Entire Agreement; Amendment.  This Agreement sets forth the entire agreement of the parties with respect to management of the Investment Account, supersedes any previous Investment Management Agreement between the Advisor and the Client or any Affiliated Company and shall not be amended except by an instrument in writing signed by the parties hereto.

 

6

 

19.                               Arbitration.  Any controversy or claim arising out of or relating to this Agreement, or the breach of the same, shall be settled by arbitration in accordance with the rules of the American Arbitration Association, and judgment upon the award rendered by the arbitrators may be entered in any court having jurisdiction.  All arbitration expenses shall be borne equally by the Advisor, on the one hand, and the Client and any affected Affiliated Company, on the other hand.  Any arbitration proceeding arising under this Agreement will be conducted in the County of New York in the State of New York or such other location as the parties mutually agree.

 

20.                               Termination.  This Agreement shall continue in force from the date hereof until terminated by either party without penalty by written notice to the other party at least sixty (60) days prior to the date upon which such termination is to become effective, provided that the Client shall honor any trades executed but not settled before the date of any such termination.  Upon termination of this Agreement, (i) any accrued and unpaid Management Fee hereunder, (ii) accrued reimbursable expenses and (iii) any reasonable additional expenses incurred in closing out the Account shall be paid by the Client or the relevant Affiliated Company to the Advisor.  Termination of this Agreement will not affect any accrued rights, indemnities, existing commitments or any contractual provisions intended to survive termination.  The Advisor may direct the custodian to retain assets in the Investment Account to settle committed transactions.

 

21.                               Severability.  If any provision of this Agreement (or any portion thereof) or the application of any such provision (or any portion thereof) to any person or circumstance shall be held invalid, illegal or unenforceable in any respect by a court of competent jurisdiction, such invalidity, illegality or unenforceability shall not affect any other provision hereof (or the remaining portion thereof) or the application of such provision to any other persons or circumstances.

 

22.                               Governing Law.  To the extent that the interpretation or effect of this Agreement shall depend on state law, this Agreement shall be governed by and construed in accordance with the laws of the State of New York.

 

23.                               Effective Date.  This Agreement shall become effective on the first date written above.

 

24.                               Receipt of Disclosure Statement.  The Client and each Affiliated Company acknowledges receipt of a copy of Part II of the Advisor’s Form ADV in compliance with Rule 204-3(b) under the Investment Advisers Act of 1940, as amended, more than 48 hours prior to the date of execution of this Agreement.  The Advisor shall annually and without charge, upon request by the Client, deliver to the Client the current version of such form or a written document containing the information then required to be contained in such form.

 

25.                               Counterparts.  This Agreement may be executed in two counterparts, each one of which shall be deemed to be an original.

 

7

 

IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be executed by their respective duly authorized representatives as of the date first written above.

 

 

	
ADVISOR:
    	
CLIENT:
    
	
 
    	
 
    
	
WHITE   MOUNTAINS ADVISORS LLC
    	
ONEBEACON   INSURANCE GROUP, LTD.
    
	
 
    	
 
    
	
 
    	
 
    
	
By:   
    	
/s/   Manning Rountree
    	
 
    	
By:   
    	
/s/   Jane E. Freedman
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
Print:   
    	
Manning   Rountree
    	
 
    	
Print:   
    	
Jane   E. Freedman
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
Title:   
    	
President
    	
 
    	
Title:   
    	
Secretary   and Associate General Counsel
    

 

 

	
AFFILIATED   COMPANIES:
    	
 
    
	
 
    	
 
    
	
MILL   SHARES HOLDINGS (BERMUDA) LTD.
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
By:   
    	
/s/   Jane E. Freedman
    	
 
    
	
 
    	
 
    	
 
    
	
Print:   
    	
Jane   E. Freedman
    	
 
    
	
 
    	
 
    	
 
    
	
Title:
    	
Vice   President and Assistant Secretary
    	
 
    

 

 

	
ONEBEACON   HOLDINGS (GIBRALTAR) LIMITED
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
By:   
    	
/s/   Jane E. Freedman
    	
 
    
	
 
    	
 
    	
 
    
	
Print:   
    	
Jane   E. Freedman
    	
 
    
	
 
    	
 
    	
 
    
	
Title:   
    	
Director
    	
 
    

 

8

 

	
ONEBEACON   HOLDINGS (LUXEMBOURG) S.A.R.L.
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
By:   
    	
/s/   Jane E. Freedman
    	
 
    
	
 
    	
 
    	
 
    
	
Print:   
    	
Jane   E. Freedman
    	
 
    
	
 
    	
 
    	
 
    
	
Title:   
    	
Manager
    	
 
    

 

 

	
WM   BELVAUX (LUXEMBOURG) S.A.R.L.
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
By:   
    	
/s/   Jane E. Freedman
    	
 
    
	
 
    	
 
    	
 
    
	
Print:   
    	
Jane   E. Freedman
    	
 
    
	
 
    	
 
    	
 
    
	
Title:   
    	
Manager
    	
 
    

 

 

	
ONEBEACON   INVESTMENTS (LUXEMBOURG) S.A.R.L.
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
By:   
    	
/s/   Jane E. Freedman
    	
 
    
	
 
    	
 
    	
 
    
	
Print:   
    	
Jane   E. Freedman
    	
 
    
	
 
    	
 
    	
 
    
	
Title:   
    	
Manager
    	
 
    

 

9

 

	
WM FINDEL   (LUXEMBOURG) S.A.R.L.
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
By:   
    	
/s/   Jane E. Freedman
    	
 
    
	
 
    	
 
    	
 
    
	
Print:   
    	
Jane   E. Freedman
    	
 
    
	
 
    	
 
    	
 
    
	
Title:   
    	
Manager
    	
 
    

 

 

	
WM   KEHLEN (LUXEMBOURG) S.A.R.L.
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
By:   
    	
/s/   Jane E. Freedman
    	
 
    
	
 
    	
 
    	
 
    
	
Print:   
    	
Jane   E. Freedman
    	
 
    
	
 
    	
 
    	
 
    
	
Title:   
    	
Manager
    	
 
    

 

 

	
WM   QUEENSWAY (GIBRALTAR) LIMITED
    	
 
    
	
 
    	
 
    
	
 
    	
 
    
	
By:   
    	
/s/   Jane E. Freedman
    	
 
    
	
 
    	
 
    	
 
    
	
Print:   
    	
Jane   E. Freedman
    	
 
    
	
 
    	
 
    	
 
    
	
Title:   
    	
Director
    	
 
    

 

10

 

	
ONEBEACON INSURANCE GROUP LLC
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
/s/   Todd C. Mills
    	
 
    
	
 
    	
 
    	
 
    
	
Print:
    	
Todd   C. Mills
    	
 
    
	
 
    	
 
    	
 
    
	
Title:
    	
Treasurer
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
ONEBEACON U.S. ENTERPRISES HOLDINGS, INC.
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
/s/   Todd C. Mills
    	
 
    
	
 
    	
 
    	
 
    
	
Print:
    	
Todd   C. Mills
    	
 
    
	
 
    	
 
    	
 
    
	
Title:
    	
Treasurer
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
ONEBEACON U.S. FINANCIAL SERVICES, INC.
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
/s/   Todd C. Mills
    	
 
    
	
 
    	
 
    	
 
    
	
Print:
    	
Todd   C. Mills
    	
 
    
	
 
    	
 
    	
 
    
	
Title:
    	
Treasurer
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
ONEBEACON U.S. HOLDINGS, INC.
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
/s/   Todd C. Mills
    	
 
    
	
 
    	
 
    	
 
    
	
Print:
    	
Todd   C. Mills
    	
 
    
	
 
    	
 
    	
 
    
	
Title:
    	
Treasurer
    	
 
    

 

11

 

	
ATLANTIC SPECIALTY INSURANCE COMPANY
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
/s/   Todd C. Mills
    	
 
    
	
 
    	
 
    	
 
    
	
Print:
    	
Todd   C. Mills
    	
 
    
	
 
    	
 
    	
 
    
	
Title:
    	
Treasurer
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
AUTOONE INSURANCE COMPANY
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
/s/   Todd C. Mills
    	
 
    
	
 
    	
 
    	
 
    
	
Print:
    	
Todd   C. Mills
    	
 
    
	
 
    	
 
    	
 
    
	
Title:
    	
Treasurer
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
AUTOONE SELECT INSURANCE COMPANY
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
/s/   Todd C. Mills
    	
 
    
	
 
    	
 
    	
 
    
	
Print:
    	
Todd   C. Mills
    	
 
    
	
 
    	
 
    	
 
    
	
Title:
    	
Treasurer
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
THE CAMDEN FIRE INSURANCE ASSOCIATION
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
/s/   Todd C. Mills
    	
 
    
	
 
    	
 
    	
 
    
	
Print:
    	
Todd   C. Mills
    	
 
    
	
 
    	
 
    	
 
    
	
Title:
    	
Treasurer
    	
 
    

 

12

 

	
THE EMPLOYERS’ FIRE INSURANCE COMPANY
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
/s/   Todd C. Mills
    	
 
    
	
 
    	
 
    	
 
    
	
Print:
    	
Todd   C. Mills
    	
 
    
	
 
    	
 
    	
 
    
	
Title:
    	
Treasurer
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
ESSENTIA INSURANCE COMPANY
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
/s/   Todd C. Mills
    	
 
    
	
 
    	
 
    	
 
    
	
Print:
    	
Todd   C. Mills
    	
 
    
	
 
    	
 
    	
 
    
	
Title:
    	
Treasurer
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
HOMELAND INSURANCE COMPANY OF NEW YORK
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
/s/   Todd C. Mills
    	
 
    
	
 
    	
 
    	
 
    
	
Print:
    	
Todd   C. Mills
    	
 
    
	
 
    	
 
    	
 
    
	
Title:
    	
Treasurer
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
THE NORTHERN ASSURANCE COMPANY OF AMERICA
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
/s/   Todd C. Mills
    	
 
    
	
 
    	
 
    	
 
    
	
Print:
    	
Todd   C. Mills
    	
 
    
	
 
    	
 
    	
 
    
	
Title:
    	
Treasurer
    	
 
    

 

13

 

	
ONEBEACON AMERICA INSURANCE COMPANY
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
/s/   Todd C. Mills
    	
 
    
	
 
    	
 
    	
 
    
	
Print:
    	
Todd   C. Mills
    	
 
    
	
 
    	
 
    	
 
    
	
Title:
    	
Treasurer
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
ONEBEACON INSURANCE COMPANY
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
/s/   Todd C. Mills
    	
 
    
	
 
    	
 
    	
 
    
	
Print:
    	
Todd   C. Mills
    	
 
    
	
 
    	
 
    	
 
    
	
Title:
    	
Treasurer
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
ONEBEACON LLOYD’S OF TEXAS
    	
 
    
	
 
    	
 
    	
 
    
	
By ONEBEACON LLOYD’S, INC., its   Attorney-in-Fact
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
/s/   Todd C. Mills
    	
 
    
	
 
    	
 
    	
 
    
	
Print:
    	
Todd   C. Mills
    	
 
    
	
 
    	
 
    	
 
    
	
Title:
    	
Treasurer
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
ONEBEACON MIDWEST INSURANCE COMPANY
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
/s/   Todd C. Mills
    	
 
    
	
 
    	
 
    	
 
    
	
Print:
    	
Todd   C. Mills
    	
 
    
	
 
    	
 
    	
 
    
	
Title:
    	
Treasurer
    	
 
    

 

14

 

	
PENNSYLVANIA GENERAL INSURANCE COMPANY
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
/s/   Todd C. Mills
    	
 
    
	
 
    	
 
    	
 
    
	
Print:
    	
Todd   C. Mills
    	
 
    
	
 
    	
 
    	
 
    
	
Title:
    	
Treasurer
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
POTOMAC INSURANCE COMPANY
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
/s/   Todd C. Mills
    	
 
    
	
 
    	
 
    	
 
    
	
Print:
    	
Todd   C. Mills
    	
 
    
	
 
    	
 
    	
 
    
	
Title:
    	
Treasurer
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
TRADERS & GENERAL INSURANCE COMPANY
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
/s/   Todd C. Mills
    	
 
    
	
 
    	
 
    	
 
    
	
Print:
    	
Todd   C. Mills
    	
 
    
	
 
    	
 
    	
 
    
	
Title:
    	
Treasurer
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
ONEBEACON CHARITABLE TRUST
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
/s/   Todd C. Mills
    	
 
    
	
 
    	
 
    	
 
    
	
Print:
    	
Todd   C. Mills
    	
 
    
	
 
    	
 
    	
 
    
	
Title:
    	
Authorized   Signatory
    	
 
    

 

15

 

	
A.W.G. DEWAR, INC.
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
/s/   Dennis R. Smith
    	
 
    
	
 
    	
 
    	
 
    
	
Print:
    	
Dennis   R. Smith
    	
 
    
	
 
    	
 
    	
 
    
	
Title:
    	
Assistant   Secretary
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
AUTOONE INSURANCE AGENCY, INC.
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
/s/   Todd C. Mills
    	
 
    
	
 
    	
 
    	
 
    
	
Print:
    	
Todd   C. Mills
    	
 
    
	
 
    	
 
    	
 
    
	
Title:
    	
Treasurer
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
EBI CLAIMS SERVICES, LLC
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
/s/   Todd C. Mills
    	
 
    
	
 
    	
 
    	
 
    
	
Print:
    	
Todd   C. Mills
    	
 
    
	
 
    	
 
    	
 
    
	
Title:
    	
Treasurer
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
NATIONAL MARINE UNDERWRITERS, INC.
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
/s/   Todd C. Mills
    	
 
    
	
 
    	
 
    	
 
    
	
Print:
    	
Todd   C. Mills
    	
 
    
	
 
    	
 
    	
 
    
	
Title:
    	
Treasurer
    	
 
    

 

16

 

	
ONEBEACON ENTERTAINMENT, LLC
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
/s/   Todd C. Mills
    	
 
    
	
 
    	
 
    	
 
    
	
Print:
    	
Todd   C. Mills
    	
 
    
	
 
    	
 
    	
 
    
	
Title:
    	
Treasurer
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
ONEBEACON LLOYD’S, INC.
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
/s/   Todd C. Mills
    	
 
    
	
 
    	
 
    	
 
    
	
Print:
    	
Todd   C. Mills
    	
 
    
	
 
    	
 
    	
 
    
	
Title:
    	
Treasurer
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
ONEBEACON PROFESSIONAL INSURANCE, INC.
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
/s/   Todd C. Mills
    	
 
    
	
 
    	
 
    	
 
    
	
Print:
    	
Todd   C. Mills
    	
 
    
	
 
    	
 
    	
 
    
	
Title:
    	
Treasurer
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
ONEBEACON RISK MANAGEMENT, INC.
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
/s/   Todd C. Mills
    	
 
    
	
 
    	
 
    	
 
    
	
Print:
    	
Todd   C. Mills
    	
 
    
	
 
    	
 
    	
 
    
	
Title:
    	
Treasurer
    	
 
    

 

17

 

	
ONEBEACON SERVICES, LLC
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
/s/   Todd C. Mills
    	
 
    
	
 
    	
 
    	
 
    
	
Print:
    	
Todd   C. Mills
    	
 
    
	
 
    	
 
    	
 
    
	
Title:
    	
Treasurer
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
ONEBEACON SPORTS AND LEISURE, LLC
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
/s/   Todd C. Mills
    	
 
    
	
 
    	
 
    	
 
    
	
Print:
    	
Todd   C. Mills
    	
 
    
	
 
    	
 
    	
 
    
	
Title:
    	
Treasurer
    	
 
    

 

18

 

SCHEDULE A

 

FEE SCHEDULE

 

Investment Account

 

	
Assets Under Management
    	
 
    	
Annual Fee
    	
 
    	
Quarterly Fee
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Investment   Grade Fixed Income
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Up to $1 billion
    	
 
    	
10.0
    	
bps
    	
2.500
    	
bps
    
	
Next $2 billion
    	
 
    	
8.5
    	
bps
    	
2.125
    	
bps
    
	
Next $3 billion
    	
 
    	
7.5
    	
bps
    	
1.875
    	
bps
    
	
Greater than $5 billion
    	
 
    	
2.5
    	
bps
    	
0.625
    	
bps
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
High   Yield
    	
 
    	
25.0
    	
bps
    	
6.250
    	
bps
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Equities
    	
 
    	
100.0
    	
bps
    	
25.000
    	
bps
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Hedge   Funds
    	
 
    	
100.0
    	
bps
    	
25.000
    	
bps
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Private   Equities & Deferreds
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
First 2 Years of Fund’s Life (Committed)
    	
 
    	
100.0
    	
bps
    	
25.000
    	
bps
    
	
Thereafter (Fair Value)
    	
 
    	
100.0
    	
bps
    	
25.000
    	
bps
    
	
 
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
Affordable   Housing Credit Funds
    	
 
    	
 
    	
 
    	
 
    	
 
    
	
First Year of Fund’s Life (Committed)
    	
 
    	
100.0
    	
bps
    	
25.000
    	
bps
    
	
Thereafter (Fair Value)
    	
 
    	
10.0
    	
bps
    	
2.500
    	
bps
    

 

Treasury Management Services.  The advisor will be paid a quarterly fee for the treasury management services computed at the annual rate of 1.75 basis points (0.0175%) of the aggregate value of the net assets of the client’s investment account on an annual basis.

 

19

 

SCHEDULE B

 

AFFILIATED COMPANIES

 

MILL SHARES HOLDINGS (BERMUDA) LTD.

ONEBEACON HOLDINGS (GIBRALTAR) LIMITED

ONEBEACON HOLDINGS (LUXEMBOURG) S.A.R.L.

WM BELVAUX (LUXEMBOURG) S.A.R.L.

ONEBEACON INVESTMENTS (LUXEMBOURG) S.A.R.L.

WM FINDEL (LUXEMBOURG) S.A.R.L.

WM Kehlen (Luxembourg) S.A.R.L.

WM Queensway (Gibraltar) Limited

OneBeacon Insurance Group LLC

OneBeacon U.S. Enterprises Holdings, Inc.

OneBeacon U.S. Financial Services, Inc.

OneBeacon U.S. Holdings, Inc.

Atlantic Specialty Insurance Company

AutoOne Insurance Company

AutoOne Select Insurance Company

The Camden Fire Insurance Association

The Employers’ Fire Insurance Company

Essentia Insurance Company

Homeland Insurance Company of New York

The Northern Assurance Company of America

OneBeacon America Insurance Company

OneBeacon Insurance Company

OneBeacon Lloyd’s of Texas

OneBeacon Midwest Insurance Company

Pennsylvania General Insurance Company

Potomac Insurance Company

Traders  & General Insurance Company

OneBeacon Charitable Trust

A.W.G. Dewar, Inc.

AutoOne Insurance Agency, Inc.

EBI Claims Services, LLC

National Marine Underwriters, Inc.

OneBeacon Entertainment, LLC

OneBeacon Lloyd’s, Inc.

OneBeacon Professional Insurance, Inc.

OneBeacon Risk Management, Inc.

OneBeacon Services, LLC

OneBeacon Sports and Leisure, LLC

 

20

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