Document:

Exhibit 10.2

 

RESTRICTED SHARE AWARD AGREEMENT

 

THIS AGREEMENT (this “Agreement”) is made effective as of the 25th day of May, 2011 between OneBeacon Insurance Group, Ltd. (the “Company”) and T. Michael Miller (the “Participant”).

 

R  E  C  I  T  A  L  S:

 

WHEREAS, the Board of Directors of the Company has adopted the OneBeacon Long-Term Incentive Plan (2007), as amended (the “Plan”), which Plan is incorporated herein by reference and made part of this Agreement.  Capitalized terms not otherwise defined herein shall have the same meanings as in the Plan; and

 

WHEREAS, the Compensation Committee of the Board of Directors (the “Committee”) has determined that it would be in the best interests of the Company and its shareholders to grant the restricted share award provided for herein to the Participant pursuant to the Plan and the terms set forth herein.

 

NOW THEREFORE, in consideration of the mutual covenants hereinafter set forth, the parties hereto agree as follows:

 

1.             Grant of the Restricted Shares.  Subject to the terms and conditions of the Plan and the additional terms and conditions set forth in this Agreement, including but not limited to Section 4, the Company hereby grants to the Participant a Restricted Share Award (this “Award”) consisting of 630,000 Shares (hereinafter called the “Restricted Shares”).  The Restricted Shares shall be subject to the Company’s option to repurchase such shares in accordance with the provisions of Section 2 hereof.

 

2.             Restrictions and Repurchase Option.

 

(a)            During the period beginning on the date of this Award and continuing until each vesting date (the “Restricted Period”), unvested Restricted Shares may not be sold, assigned, transferred, pledged, hypothecated or otherwise disposed of, except by will or the laws of descent and distribution.  The vesting schedule for the Restricted Shares is as follows:

 

	
Vesting Date
    	
 
    	
No. of Shares Vesting
    
	
February 22, 2014
    	
 
    	
157,500
    
	
February 22, 2015
    	
 
    	
157,500
    
	
February 22, 2016
    	
 
    	
157,500
    
	
February 22, 2017
    	
 
    	
157,500
    

 

(b)           Except as otherwise set forth herein or in the Plan, the Participant shall forfeit, and the Company shall have the option to repurchase unvested Restricted Shares, in accordance with Section 5(b) of the Plan, during the Restricted Period at a price equal to $.001 per Restricted Share, in the event that the Participant’s continuous employment with the Company or any of its subsidiaries is terminated.

 

3.          Vesting in the Event of Termination of Employment Due To Death, Disability or Involuntary Termination Other Than For Cause, Including Constructive Termination.

 

(a)              In the event that the Participant dies or become disabled (as defined in Section 8 of the LTIP)  during the Restricted Period, a portion of the Restricted Shares shall become vested.  The number of shares that shall become vested (which number shall include any Restricted Shares that have

 

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previously vested in accordance with the terms of this Agreement) shall equal: (A) 630,000 multiplied  by (B) a percentage, the numerator of which is equal to the number of months from February 22, 2011 through the date of death or disability and the denominator of which is equal to seventy-two (72).  The remaining unvested Restricted Shares shall be forfeited, and subject to repurchase in accordance with Section 2(b) of this Agreement.

 

(b)              Except as set forth in Section 3(c) below, in the event that the Participant is involuntarily terminated other than for Cause (as such term is defined in Section 11 of the LTIP) during the Restricted Period, a portion of the Restricted Shares shall become vested.   The number of shares that shall become vested (which number shall include any Restricted Shared that have previously vested in accordance with the terms of this Agreement) shall equal: (A) 630,000 multiplied  by (B) a percentage, the numerator of which is equal to the number of months from February 22, 2011 through the date of termination and the denominator of which is equal to seventy-two (72); provided, however, that in no event shall the number of vested Restricted Shares (including any Restricted Shares that have previously vested in accordance with the terms of this Agreement) shall be less than 315,000.  The remaining unvested Restricted Shares shall be forfeited, and subject to repurchase in accordance with Section 2(b) of this Agreement.

 

(c)              In the event that the Participant is involuntarily terminated other than for Cause  during the Restricted Period within 24 months of a Change in Control (as defined in the Plan), 100% of the Restricted Shares shall vest as of the date on which the termination occurs.

 

(d)              For purposes of this Award, “Constructive Termination” shall mean a termination of employment with the Company or a subsidiary within 24 months of a Change in Control at the initiative of the Participant that the Participant declares by prior written notice delivered to the Secretary of the Company to be a Constructive Termination by the Company or a subsidiary and which follows (a) a material decrease in his total compensation opportunity or (b) a material diminution in the authority, duties or responsibilities of his position with the result that the Participant makes a determination in good faith that he cannot continue to carry out his job in substantially the same manner as it was intended to be carried out immediately before such diminution or (c) a change in the primary geographic location in which the job is expected to be performed that is greater than 50 miles from the previous location, and the Participant chooses not to relocate, then Constructive Termination will be deemed to have occurred after the Participant provides 18 months of service by commuting to the new location from the geographic location of his principal place of residence at the time of the Change in Control, or (d) a change in the primary geographic location in which the job is expected to be performed that is greater than 50 miles from the previous location, the Participant chooses not to relocate, and the acquiring company does not allow the Participant to provide services by commuting to the new location from the geographic location of his principal place of residence at the time of the Change in Control, then Constructive Termination will be deemed to have occurred immediately upon the effective date of the change in geographic location. Notwithstanding anything in the Plan to the contrary, Constructive Termination shall not occur within the meaning of Section 12 of the Plan until and unless 30 days have elapsed from the date the Company receives such written notice from the Participant without the Company curing or causing to be cured the circumstance or circumstances described in Section 12 of the Plan on the basis of which the declaration of Constructive Termination is given.

 

4.             Separation Pay.  In consideration of this Award, the Participant hereby agrees to forfeit any and all right to receive or be paid any separation, severance or termination compensation from the Company or any of its affiliates in the event that the Participant’s employment with the Company ceases at any time during the Restricted Period (other than, within 24 months of a Change in Control, an involuntary termination or Constructive Termination).

 

5.             Book Entry.  The Restricted Shares shall be registered in the Participant’s name in book entry form on the share transfer books of the Company promptly after the date hereof.

 

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6.             Rights as a Shareholder.  The Participant shall be the record owner of the Restricted Shares until or unless such Shares are sold to the Company pursuant to Section 2 hereof and as record owner shall be entitled to all rights of a common shareholder of the Company, including the right to vote the shares and receive dividends thereon.  As soon as practicable following the end of the Restricted Period, the Company shall, on or about such date(s), deliver to the Holder evidence of ownership in book entry form of the number of Shares set forth opposite such date.

 

7.             Legend.  The Restricted Shares shall be subject to such stop transfer orders and other restrictions as the Committee may deem advisable under the Plan or the rules, regulations, and other requirements of the Securities and Exchange Commission, any share exchange upon which such Shares are listed, and any applicable Federal, state or foreign laws, and the Committee may cause an appropriate reference to such restrictions to be made in the Company’s share transfer books or on any certificate that may be issued to evidence the Shares.

 

8.             No Right to Continued Employment.  Neither the Plan nor this Agreement shall be construed as giving the Participant the right to be retained in the employ of, or in any consulting relationship to, the Company or any of its subsidiaries.  Further, the Company or any of its subsidiaries may at any time dismiss the Participant or discontinue any consulting relationship, free from any liability or any claim under the Plan or this Agreement, except as otherwise expressly provided herein.

 

9.             Withholding.  The Participant agrees to make appropriate arrangements with the Company for satisfaction of any applicable federal, state, local or foreign income tax withholding requirements or like requirements, including the payment to the Company, at the termination of the Restricted Period (or such earlier or later date as may be applicable under Section 83 of the Code), or at any other settlement date in respect of the Restricted Shares, of all such taxes and other amounts and the Company shall be authorized to take such action as may be necessary, in the opinion of the Company’s counsel (including, without limitation, withholding Shares otherwise deliverable to Participant hereunder and/or, subject to applicable law, withholding amounts from any compensation or other amount owing from the Company to the Participant), to satisfy all obligations for the payment of such taxes and other amounts.

 

10.           Securities Laws.  At the termination of the Restricted Period, the Participant will make or enter into such written representations, warranties and agreements as the Committee may reasonably request in order to comply with applicable securities laws and with this Agreement.

 

11.           Notices.  Any notice necessary under this Agreement shall be addressed to the Company in care of the Secretary at the principal executive office of the Company and to the Participant at the address appearing in the personnel records of the Company for such Participant or to either party at such other address as such party hereto may hereafter designate in writing to the other.  Any such notice shall be deemed effective upon receipt thereof by the addressee.

 

12.           Restricted Share Award Subject to Plan and Confidentiality and Non-Solicitation Agreement.  By entering into this Agreement, the Participant agrees and acknowledges that the Participant has received and read a copy of the Plan, understands the terms of the Plan and this Agreement and that this Award is subject to all of the terms and provisions set forth in the Plan and in this Agreement and accepts this Award subject to all such terms and conditions which are incorporated herein by reference.  Participant also acknowledges and agrees that this Award is subject to the terms and conditions of the Confidentiality and Non-Solicitation Agreement entered into between Participant and the Company dated as of May 2008, including but not limited to the prohibition on soliciting or hiring employees and soliciting customers and potential customers for twelve (12) months post-termination.  Except with respect to Sections 3 and 4 of this Agreement, in the event of a conflict between any term or provision contained in this Agreement and a terms or provision of the Plan, the applicable terms and provisions of the Plan will govern and prevail.

 

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

 

IN WITNESS WHEREOF, the parties hereto have executed this Agreement.

 

	
 
    	
 
    	
 
    	
 
    	
OneBeacon Insurance Group, Ltd.
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
By:
    	
/s/   T. Michael Miller
    	
 
    	
By:
    	

    
	
T. Michael Miller
    	
 
    	
 
    	
Bradford   W. Rich, Senior Vice President and General Counsel
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    	
 
    
	
5/27/11
    	
 
    	
 
    	
 
    	
 
    
	
Date
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
Award Details:
    	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    	
 
    
	
Restricted Share Award
    	
 
    	
 
    	
 
    
	
630,000 Shares Granted
    	
 
    	
 
    	
 
    
						

 

4Exhibit 10.3

 

CONFIDENTIALITY AND NON-SOLICITATION AGREEMENT

 

This Confidentiality and Nonsolicitation Agreement (the “Agreement”) is made between OneBeacon Insurance Company and <First Name> <Last Name> (the “Employee”) (collectively, the “Parties”).

 

In consideration of Employee’s employment by OneBeacon Insurance Company or by one of its affiliates (collectively “OneBeacon”) in a capacity of high trust and confidence in which Employee may develop or receive highly sensitive, restricted and proprietary information involving Confidential Information (as defined below), and in which Employee may seek out and develop customer Goodwill (as defined below) using the resources provided by OneBeacon as well as OneBeacon’s reputation, and of Employee’s eligibility to participate in OneBeacon Insurance Group, Ltd.’s Long Term Incentive Plan, and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Employee hereby agrees as follows:

 

1.             Employment At Will.  The Employee agrees that he/she is an “at will” employee of OneBeacon and that he/she may terminate his/her employment at any time.  The Employee further agrees that OneBeacon may similarly terminate the Employee’s employment at any time.  This agreement does not create a contract for employment for any specified duration, either expressly or by implication.

 

2.             Non-disclosure of Confidential Information.  Employee acknowledges that, in order for him/her to perform his/her duties properly, Employee will have access to and OneBeacon must necessarily entrust him/her with certain proprietary and confidential business information (the “Confidential Information”).  The Employee agrees that, during the term of his/her employment with OneBeacon and at all times thereafter, regardless of the reason for termination of employment, he/she will not disclose any OneBeacon Confidential Information or use it in any way, except with the prior written authorization by or on behalf of OneBeacon, whether or not such Confidential Information is produced by the Employee’s own efforts.

 

a.   For purposes of this Agreement, “Confidential Information” means all original and copies of all material, data, documents, and information in any format (including without limitation all hardcopy, softcopy, electronic, web, and computer-based information, documents, data files, records, videos, pictures, and recordings) which constitutes confidential and/or trade secret information as further defined in this Agreement and/or Massachusetts law.  Examples of Confidential Information include, but are not limited to:

·                  OneBeacon’s proprietary information, including without limitation all business methods, databases, software, including the source code, object code and operational and functional features and limitations of the software, and other computer technology;

·                  OneBeacon’s business development plans and activities, including without limitation the identity and characteristics of OneBeacon’s current and prospective customers, distributors, vendors, suppliers, or any other type of business relationship;

·                  information concerning pending and prospective mergers, acquisitions, or other types of transactions;

·                  the prices, terms and conditions of OneBeacon’s contracts or agreements with its current and prospective customers, distributors, vendors, suppliers, or any other type of business relationship;

 

 

·                  OneBeacon’s cost and pricing policies and data, including without limitation the costs of OneBeacon’s business and all results of its business operations;

·                  OneBeacon’s business and marketing plans, manuals and strategies;

·                  OneBeacon’s financial information, including but not limited to results from operations, results relating to various programs, profit/loss and revenue figures, transaction data and account information;

·                  OneBeacon facility and data security-related information, including without limitation door access codes, computer access codes, security system PINs, computer system user identification information, passwords and remote access codes;

·                  OneBeacon personnel information, including but not limited to, performance reviews, compensation information, personal information, ranking, skills and competencies;

·                  information acquired by or on behalf of OneBeacon about OneBeacon’s current and prospective customers, distributors, vendors, suppliers, producers, or any other type of business relationship;

·                  intellectual property of OneBeacon;

provided, however, that Confidential Information does not include material, data, documents, and/or other information that OneBeacon has voluntarily placed in the public domain; that has been lawfully and independently developed and publicly disclosed to third parties; that constitutes general knowledge and skills gained by Employee during the period of his or her employment with OneBeacon; or that otherwise enters the public domain through lawful means.

 

b.   Employee further acknowledges that the development or acquisition of such Confidential Information is the result of great effort and expense by OneBeacon, that the Confidential Information is critical to the survival and success of OneBeacon, and that the unauthorized disclosure or use of the Confidential Information would cause OneBeacon irreparable harm.

 

3.             Prohibited Post-employment Solicitation:

 

(a) In order to protect OneBeacon’s Goodwill (as defined below), Confidential Information, and OneBeacon’s other legitimate business interests, Employee agrees that he/she shall not, directly or indirectly, for a period of twelve (12) months from the termination of Employee’s employment for any reason:

 

·                  initiate, receive, or otherwise engage in contact, directly or indirectly, with any individual or entity that is (1) a current insured of OneBeacon (and where applicable, limited to a specific layer) that the Employee directly serviced or otherwise had contact with on behalf of OneBeacon; or (2) a prospective customer or account identified by OneBeacon and actively being pursued by OneBeacon that the Employee serviced or otherwise had contact with on behalf of OneBeacon (again where applicable, limited to a specific layer); or (3) a current insured or prospective customer or account actively being pursued by OneBeacon about which the Employee acquired Confidential Information as a result of his/her employment with OneBeacon (collectively “Protected Customer”), for the purpose of soliciting business from such individual or entity and/or to divert that individual’s or entity’s business away from OneBeacon.

 

 

·                  divert or attempt to divert a Protected Customer from OneBeacon by soliciting any producer or supplier, or prospective producer or supplier of OneBeacon from doing business with OneBeacon or otherwise to change its relationship with OneBeacon; or

 

·                  solicit or induce, or attempt to solicit or induce, any employee, consultant, or independent contractor of OneBeacon to leave OneBeacon for any reason whatsoever, or hire or solicit the services of any employee of OneBeacon.

 

(b) The twelve (12) month restrictive period shall be tolled for the period of time that Employee had already been engaging in the prohibited conduct described herein after termination of employment.  The Parties intend that OneBeacon shall be entitled to a full twelve (12) month period of post-employment conduct that does not breach this Agreement.

 

(c) “Goodwill” means the result of OneBeacon’s efforts, the efforts of OneBeacon and a supplier, customer, producer, or any other type of business relationship, and/or the Employee’s efforts on behalf of OneBeacon and/or a current or prospective customer, distributor, vendor, supplier, producer, or any other type of business relationship, to develop and enhance OneBeacon’s reputation in the industry, its business relationships, and other related business contacts.  Because of the competitive nature of OneBeacon’s business and OneBeacon’s repeat transactions with many customers, distributors, vendors, suppliers, etc., the parties agree that OneBeacon’s Goodwill is critical to ensuring OneBeacon’s survival and success and such Goodwill constitutes a valuable asset belonging to OneBeacon, regardless of whether such asset was produced by the Employee’s own efforts or the efforts of other employees of OneBeacon.

 

4.             Specific Performance.  Employee acknowledges that a breach of this Agreement will cause irreparable injury to OneBeacon, that OneBeacon’s remedies at law will be inadequate in case of any such breach or threatened breach, and that OneBeacon will be entitled to preliminary injunctive relief and other injunctive relief in case of any such breach or threatened breach.

 

5.             Waivers.  The waiver by OneBeacon or the Employee of any action, right or condition in this Agreement, or of any breach of a provision of this Agreement, shall not constitute a waiver of any other occurrences of the same event.

 

6.             Survival, Binding Effect.  This Agreement shall survive the termination of the Employee’s employment with OneBeacon regardless of the manner of such termination and shall be binding upon the Employee.

 

7.             Assignability by OneBeacon.  This Agreement is assignable by OneBeacon and inures to the benefit of OneBeacon, its subsidiaries, affiliated corporations, successors and assignees. This Agreement, being personal, is not assignable by the Employee.

 

8.             Severability. The covenants of this Agreement are intended to be separable, and the expressions used therein are intended to refer to divisible entities. Accordingly, the invalidity of all or any part of any section of this Agreement shall not render invalid the remainder of this Agreement or of such section.  If, in any judicial proceeding, any provision of this Agreement is found to be so broad as to be unenforceable, it is hereby agreed that such provision shall be interpreted to be only so broad as to be enforceable.

 

 

9.             Governing Law.  This Agreement shall be governed by and construed in accordance with the laws of the Commonwealth of Massachusetts, but not the Commonwealth’s laws concerning conflict of laws, and shall be deemed to have been made in Massachusetts.

 

10.           Consent To Jurisdiction.  Employee hereby consents and submits to the exclusive jurisdiction of the state and federal courts of Massachusetts for any dispute concerning or arising out of this Agreement.

 

11.           Covenant Not To Sue Outside Of Massachusetts.  Employee hereby agrees that he/she will neither commence or prosecute, nor assist in any way another person or entity to commence or prosecute, any legal action or other proceeding (including but not limited to a declaratory judgment action) against OneBeacon concerning a dispute arising from or relating to this Agreement in any forum or jurisdiction other than the state and federal courts in the state of Massachusetts.  Employee further agrees that, in the event he/she disregards this clause, OneBeacon shall be entitled to recover its reasonable attorneys’ fees and other costs incurred in staying, transferring, dismissing or otherwise defending such out-of-state action or proceeding, regardless of whether such fees and costs are incurred in the forum where Employee commenced the action or in a Massachusetts forum, and without regard to whether OneBeacon prevails in its efforts to enforce this covenant.

 

12.           Entire Agreement, Amendments.  This Agreement constitutes the entire understanding of the parties with respect to its subject matter, supersedes any prior communication or understanding with respect thereto, and no modification or waiver of any provision hereof shall be valid unless made in writing and signed by all of the parties hereto.

 

13.           Return of OneBeacon Property and Confidential Information Upon Termination of Employment.  The Employee agrees, upon termination of his/her employment for any reason, to deliver the following to OneBeacon promptly and without waiting for a request from OneBeacon:  all files, books, documents, computer disks or tapes, computers, phones, PDAs, keys, security passes, credit cards, and any other property prepared by or on behalf of OneBeacon or otherwise provided or paid for by OneBeacon; all Confidential Information in Employee’s possession, and any copies thereof.  The Employee further agrees to refrain from making, retaining or distributing copies of any such property or Confidential Information.  To the extent that Employee has any data belonging to OneBeacon on any storage media owned or otherwise used by Employee (for example, a personal computer’s hard disk drive, portable data storage device, etc.), Employee agrees that immediately upon termination he/she will provide OneBeacon with a copy of the data and then permanently purge such computer (or other storage media) of the data.  Employee agrees to cooperate with OneBeacon if OneBeacon requests written or other positive confirmation of the removal or return of such data from any personal storage media.

 

14.           This Agreement may be executed in multiple counterparts, each of which shall be treated as an original.

 

 

IN WITNESS WHEREOF, the parties have duly executed this Confidentiality and Nonsolicitation Agreement under seal effective as of the                          day of                                      20        .

 

 

	
EMPLOYEE
    	
ONEBEACON   INSURANCE COMPANY,
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	

    
	
By:
    	
 
    	
 
    	
By:
    	
 
    
	
<First Name> <Last Name>
    	
 
    	
Name:   
    	
Mike   Miller
    
	
 
    	
 
    	
Title:
    	
President &   CEO
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Street   address
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
City   and state
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
Ed. June 26, 2008

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