Exhibit 10.22
PLATINUM UNDERWRITERS HOLDINGS, LTD.
EXECUTIVE BONUS DEFERRAL PLAN
As of October 2003
Exhibit 10.22
PLATINUM UNDERWRITERS HOLDINGS, LTD.
EXECUTIVE BONUS DEFERRAL PLAN
PREAMBLE
This Executive Bonus Deferral Plan has been established by the Company for
the purpose of providing an opportunity for selected employees to defer receipt
of all or part of the cash portion of their annual bonus compensation and earn
tax-deferred interest thereon. The Plan constitutes a plan of unfunded deferred
compensation maintained for a select group of management or highly compensated
employees for purposes of ERISA.
SECTION 1. DEFINITION OF TERMS
The following terms used in the Plan shall have the meanings set forth
below:
(a) "Account" means the deferred compensation account maintained for
each Participant under the Plan.
(b) "Beneficiary" means the person or persons who are designated by
the Participant to receive benefits under the Plan in the event of the
Participant's death, as provided in Section 5(d) hereof.
(c) "Board" means the Board of Directors of the Company.
(d) "Cash Bonus" means the pre-tax amount of the cash portion of the
annual bonus that is otherwise payable to a Participant for a Plan Year
under the annual incentive plan of the Company, and shall not include any
portion of an annual bonus that is payable in shares, share units or in any
form other than cash.
"Compensation Committee" means the Compensation Committee of the
Board, or such other committee of members of the Board appointed by
the Board as Plan Administrator hereunder.
(e) "Company" means Platinum Underwriters Holdings, Ltd., a Bermuda
corporation.
(f) "Deferral Percentage" means the percentage a Participant's Cash
Bonus that is specified by a Participant on his or her Election Form for
deferral under the Plan.
(g) "Election Form" means the form approved by the Plan
Administrator and completed by the Participant specifying the terms and
conditions of an election to defer Cash Bonus compensation under the Plan.
(h) "ERISA" means the Employee Retirement Income Security Act of
1974, as amended.
(i) "Participant" means an employee of the Company who is eligible
to participate in the Plan and who elects to defer all or a portion of his
Cash Bonus compensation under Section 3 hereof.
(j) "Plan" means this Platinum Underwriters Holdings, Ltd. Executive
Bonus Deferral Plan.
(k) "Plan Administrator" means the Compensation Committee of the
Board or such other Plan Administrator acting in accordance with Section 2
hereof.
(l) "Plan Year" means the calendar year. The first Plan Year shall
be 2004.
SECTION 2. PLAN ADMINISTRATION
The Compensation Committee is appointed as Plan Administrator, and
shall have full authority to administer the Plan, including the
discretionary authority to interpret and construe all provisions of the
Plan, to resolve all questions of fact arising under the Plan, and to adopt
such rules and regulations for administering the Plan as it may deem
necessary or appropriate. Decisions of the Plan Administrator shall be
final and binding on all parties. The appropriate officers of the Company
are authorized to act on behalf of the Plan Administrator for the
day-to-day administration of the Plan, subject to the authority of the
Compensation Committee. No member of the Board, the Compensation Committee
or any officer acting on its behalf shall have any liability for any action
or determination taken in good faith under the Plan. All expenses of the
administration of the Plan shall be borne by the Company, and shall not be
deducted from Participants' Accounts.
SECTION 3. ELIGIBILITY AND PARTICIPATION
(a) ELIGIBILITY TO PARTICIPATE. Any employee of the Company shall
be eligible to participate in the Plan if the employee: (i) has the title
of Senior Vice President or higher, (ii) earns a gross base salary of
$200,000 per annum or greater, and (iii) receives Cash Bonus compensation
for a Plan Year that is subject to United States federal income tax. The
Plan Administrator may require an employee to comply with such terms and
conditions as it may specify in order to be eligible to participate in the
Plan as the Plan Administrator deems necessary or appropriate for the
proper conduct and administration of the Plan.
(b) ELECTION TO PARTICIPATE. An eligible employee may file an
Election Form with the Plan Administrator (or its designee) on or before
the date specified by the Plan Administrator prior to the Plan Year to
which the election shall relate, specifying the Deferral Percentage and the
terms of distribution of the deferral. All such elections are irrevocable,
and no changes to any Election Form delivered to the Plan Administrator
shall be permitted for the Plan Year. A Participant must file a new
Election Form with the Plan Administrator for each Plan Year for which the
Cash Bonus is deferred, on or before the deadline established by the Plan
Administrator for such deferral elections. A Participant will be deemed not
to have elected deferral of the Cash Bonus for a Plan Year if the
Participant does not file an Election Form with the Plan Administrator on
or before the deadline established by the Plan Administrator for such
deferral elections.
SECTION 4. PARTICIPANT ACCOUNTS
(a) ACCOUNTS. An Account shall be maintained for each Participant
under the Plan. A Participant's Account shall consist of book entries only
and shall not constitute a separate cash fund or other asset held in trust
or as security for the Company's obligation to pay the amount of the
Account to the Participant. The balance of a Participant's Account shall be
the sum of deferred compensation credits made to his or her Account,
adjusted for accrued interest and reduced by the amount of distributions
under the Plan. A Participant's Account may include sub-accounts as the
Company considers necessary or advisable for purposes of maintaining a
proper accounting of amounts credited for a Participant under the Plan. A
Participant shall receive a statement of his or her Account not less
frequently than following the end of each Plan Year.
(b) CREDITING OF DEFERRALS. A Participant who has filed an Election
Form with the Plan Administrator for the deferral of Cash Bonus
compensation with respect to a Plan Year shall have the deferred amount
deducted from the Cash Bonus and credited to his or her Account under the
Plan at the same time as the Cash Bonus payment would otherwise be paid to
the Participant during such Plan Year, based on the Deferral Percentage
specified by the Participant and the amount of the Cash Bonus that is
otherwise payable to the Participant. The amount so credited shall be
reduced by the amount that the Plan Administrator determines is required to
be withheld for Social Security, Medicare and other payroll taxes.
(c) INTEREST CREDITING. A Participant's Account shall accrue
interest from the date of crediting until the most recent practicable date
prior to the date of distribution under the Plan, based on an interest rate
specified by the Plan Administrator. Unless otherwise specified, the
interest rate shall be equal to the prime commercial lending rate charged
by Citibank, N.A., as published in The Wall Street Journal at the beginning
of each calendar quarter of the deferral period, plus one percent (1%).
The rate shall remain in effect until the beginning
of the subsequent calendar quarter, and all Accounts shall be compounded
on a quarterly basis.
(d) VESTING OF ACCOUNTS. All deferred compensation credits and
interest thereon under a Participant's Account shall be fully vested at all
times.
SECTION 5. DISTRIBUTION OF BENEFITS
(a) DISTRIBUTION DATES. A Participant shall specify on his or her
Election Form the time at which the deferred Cash Bonus (and earnings
thereon) for the Plan Year shall be distributed from the Plan. Any
election by the Participant as to the distribution of the Account shall be
irrevocable. A Participant may elect, to the extent permitted by the Plan
Administrator and set forth on the Election Form, that such portion of the
Account be distributed either:
(i) upon termination of employment from the Company; or
(ii) the last day of any calendar month following the January
1 that follows the third anniversary of the date the Election Form is
filed with the Plan Administrator.
Notwithstanding any election made by a Participant, a distribution of
the full Account balance shall be made as soon as practicable
following the date that Participant's employment with the Company is
terminated for any reason.
(b) HARDSHIP DISTRIBUTIONS. Upon the written request of a
Participant, the Plan Administrator may permit the Participant to withdraw
some or all of his or her Account for the purpose of enabling the
Participant to meet the immediate needs created by a severe financial
hardship of the Participant resulting from a sudden and unexpected illness
or accident of the Participant or of a dependent of the Participant, loss
of the Participant's property due to casualty, or other similar
extraordinary and unforeseeable circumstances arising as a result of events
beyond the control of the Participant. The circumstances that will
constitute a severe financial hardship will depend upon the facts of each
case, but in any case, payment may not be made to the extent such hardship
is or may be relieved through: (i) reimbursement or compensation through
insurance or otherwise; (ii) liquidation of the Participant's assets, to
the extent such liquidation of assets would not itself cause a financial
hardship; or (iii) cessation of deferrals under the Plan.
(c) FORM OF DISTRIBUTIONS. All distributions from Participant's
Accounts shall be made in a cash lump sum as soon as practicable following
the end of the calendar month in which the Participant becomes entitled to
a distribution under this Section 5. All such payments shall be subject to
income tax and other withholdings that the Plan Administrator deems
necessary or appropriate.
(d) BENEFICIARIES. Any payment required to be made to a Participant
under the Plan that cannot be made due to the Participant's death shall be
made to the Participant's Beneficiary, subject to applicable law. Each
Participant shall have the right to designate a Beneficiary from time to
time by filing a written notice with the Plan Administrator. In the event a
Beneficiary does not survive the Participant and no successor Beneficiary
is selected, or in the event no valid Beneficiary designation has been
made, the Participant's Beneficiary shall be the Participant's estate.
SECTION 6. UNFUNDED STATUS
All Accounts and all rights of Participants to benefits under the Plan are
unfunded obligations of the Company. Plan benefits shall be paid from the
general assets of the Company, and Participants shall have the status of an
unsecured general creditor of the Company with respect to all interests under
the Plan. The Plan is a plan of unfunded deferred compensation for purposes of
ERISA. Notwithstanding the foregoing, the Company may, but shall not be
required, to establish a trust or other funding vehicle under the Plan that does
not affect the Plan's status as a Plan of unfunded deferred compensation under
ERISA.
SECTION 7. NONTRANSFERABILITY
Except for payments of benefits to the Beneficiary of a Participant in
accordance with the terms of the Plan, a Participant's Accounts may not be
transferred, assigned, alienated, pledged, encumbered or subjected to
attachment, garnishment, levy, execution or other legal or equitable process.
SECTION 8. LIMITATION OF RIGHTS
Nothing in the Plan shall confer upon any Participant the right to continue
to be employed by the Company or to serve in the capacity in which he or she is
employed by the Company. Nothing in the Plan shall be interpreted as creating a
right of a Participant to receive a Cash Bonus or other incentive compensation
from the Company.
SECTION 9. ENFORCEABILITY
The Plan shall be construed, administered and enforced in accordance with
ERISA, and to the extent not preempted thereby, the laws of the State of New
York. To the extent that any provision of the Plan or portion thereof shall be
invalid or unenforceable, it shall be considered deleted herefrom and the
remainder of such provision and the Plan shall be unaffected and shall continue
in full force and effect.
SECTION 10. AMENDMENT AND TERMINATION
The Board may amend or terminate the Plan at any time and in any manner,
provided that no amendment or termination shall reduce the amount credited to a
Participant's Account at the time of any such amendment or termination. Upon
termination of the Plan, all deferrals and interest crediting shall cease, and
the balance of all Plan Accounts shall be distributed to Participants as
promptly as practicable.
PLATINUM UNDERWRITERS HOLDINGS, LTD.