Employment Agreement - ACE Ltd. and Evan Greenberg
[LETTERHEAD OF ACE LIMITED]
October 29, 2001
Mr. Evan Greenberg
Dear Evan,
Further to our recent discussions, please now find attached the main elements of
compensation relative to our offer of employment to you as Chief Executive
Reinsurance Operations and Vice Chairman ACE Limited, subject to the formality
of obtaining a Bermuda work permit.
You will in addition, participate in all the benefit plans enjoyed by our senior
executive group, which includes an executive medical program as well as
financial and tax planning.
For the sake of clarity, I should also point out that ACE is required to deduct
Government Payroll Tax on compensation, which, in your case will amount to
approximately $10,000. All other local taxes are absorbed by the Company. As you
would expect, ACE withholds income tax from US citizens and complies with all US
reporting obligations.
Our Long Term Incentive program anticipates annual awards and the level of
options follows advice from William Mercer & Co. regarding the Black Scholes
value which presently ranges between 40% and 45% of the face value of stock
reflecting the historic volatility of the Company's share price.
Evan, I sincerely hope that you will find our offer attractive and feel certain
that your capabilities will add significantly to ACE development. I shall really
look forward to working with you again in this very dynamic environment.
Yours sincerely,
Brian Duperreault
Chairman and Chief Executive Officer
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CEO, Reinsurance Operations &
Vice Chairman, ACE Limited
SALARY $800,000 per annum
LIVING ALLOWANCE $100,000 per annum
ANNUAL CASH INCENTIVE: At the discretion of the Board of Directors
based on individual contribution and the
Company's results. It is anticipated that the
range will be between 0 - 150% of annual
cash salary.
CASH INCENTIVE: $500,000 to be paid on joining.
(Sign-On)
ANNUAL LONG TERM INCENTIVE: At the discretion of the Board of Directors
based on individual contribution and the
Company's results. It is anticipated that you
will be eligible for consideration for award
at the end of Financial Year 2002 with a
potential range delivered in combined
restricted stock and options projected to be
up to 250% of base salary.
LONG TERM INCENTIVE: 25,000 Restricted Ordinary ACE Limited Shares
(Sign On) to be awarded at the New York Stock Exchange
closing price for ACE Limited Ordinary Shares
on the 1/st/ business trading day of the month
immediately following your start date. Vest
25% per annum over 4 years provided you are
employed by the Company on each vesting date,
with the first 25% to vest on the first
anniversary date of the grant.
100,000 Options to purchase ordinary ACE
Limited Shares to be awarded at the New York
Stock Exchange closing price for ACE Limited
Ordinary Shares on the 1/st/ business trading
day of the month immediately following your
start date. Vesting 33 1/3% per annum over 3
years provided you are employed on each
vesting date with the first 33 1/3% vesting on
first anniversary date of grant.
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DEFINED CONTRIBUTION PLAN: Participation in Company's retirement plan.
Based on cash salary and annual cash incentive
- 6% Company contribution plus up to 6% Company
contribution to match individual contribution
with potential for up to an additional 3%
profit share contribution by the Company.
LIFE ASSURANCE: Coverage in accordance with ACE Limited's
current plan
4 x annual salary - subject to medical.
DISABILITY INSURANCE: Coverage in accordance with ACE Limited's
current plan
60% of salary after six months total disability
- subject to medical.
HEALTH (including DENTAL) Coverage in accordance with ACE Limited's
& MAJOR MEDICAL INSURANCE: current plan, subject to six month's exclusion
for any known pre-existing conditions.
HOUSING ALLOWANCE Reimbursement for cost of renting suitable
accommodation in Bermuda
CAR LOAN: Interest free loan for an automobile up to a
maximum amount of $32,000 depreciated over a
six-year period.
CAR ALLOWANCE: Reimbursement for expenses of $350 per month
towards the cost of running an automobile e.g.
gas, repairs, license and insurance etc.
(subject to owning a car)
CLUB MEMBERSHIP: Club membership of your choice in Bermuda -
initiation and annual dues.
VACATION: 20 days per calendar year exclusive of public
holidays.
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