UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 14A
Proxy Statement Pursuant to Section 14(a) of the Securities
Exchange Act of 1934
Filed
by the Registrant ☒
Filed
by a Party other than the Registrant ☐
Check
the appropriate box:
☐
Preliminary Proxy Statement
☐
Confidential, for Use of the
Commission Only (as permitted by Rule
14a-6(e)(2))
☒ Definitive
Proxy Statement
☐
Definitive Additional Materials
☐
Soliciting Material under §240.14a-12
OXBRIDGE RE HOLDINGS LIMITED
(Name
of Registrant As Specified in its Charter)
(Name
of Person(s) Filing Proxy Statement, if other than the
Registrant)
Payment
of Filing Fee (Check the appropriate box):
☒ No fee
required.
☐ Fee
computed on table below per Exchange Act Rules 14a-6(i)(1) and
0-11.
(1)
Title of each class
of securities to which transaction applies:
(2)
Aggregate number of
securities to which transaction applies:
(3)
Per unit price or
other underlying value of transaction computed pursuant to Exchange
Act Rule 0-11 (set forth the amount on which the filing fee is
calculated and state how it was determined):
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paid previously with preliminary materials.
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Check box if any part of the fee is offset as provided by Exchange
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offsetting fee was paid previously. Identify the previous filing by
registration statement number, or the Form or Schedule and the date
of its filing.
(1)
Amount Previously
Paid:
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Form, Schedule or
Registration Statement No.:
OXBRIDGE RE HOLDINGS LIMITED
Suite 201, 42 Edward
Street
P.O. Box 469
Grand Cayman, KY1-9006
Cayman Islands
NOTICE OF VIRTUAL ANNUAL GENERAL MEETING OF
SHAREHOLDERS
TO BE HELD ON JUNE 2, 2021
Due to
the public health impact of the coronavirus outbreak (COVID-19) and
to support and protect the health and well-being of our partners
and shareholders, notice is hereby given that the Annual General
Meeting of Shareholders (the “Meeting”) of Oxbridge Re
Holdings Limited (the “Company”, “we” or
“us”) will be held in a virtual meeting format only.
You will not be able to attend the Annual Meeting physically. The
Meeting will be held via a live webcast on Tuesday, June 2, 2021,
at 9:00 a.m. (Central Time). You are
invited to attend the virtual Annual Meeting to vote on the
proposals described in this proxy statement by joining the webcast
available at virtualshareholdermeeting.com/OXBR2021.
You do not need to attend the virtual Annual Meeting to vote your
shares. Instead, you may simply complete, sign and return the
enclosed proxy card or voting instruction form, if you received
paper copies of the proxy materials, or follow the instructions
below to submit your proxy over the telephone or the Internet. We
expect to resume in person shareholder meetings in successive
years.
The
Meeting will have the following purposes:
1.
To consider and
vote upon a proposal to elect four directors to serve on the Board
of Directors of the Company until the Annual General Meeting of
Shareholders of the Company in 2021;
2.
To consider and
vote upon a proposal to approve the Oxbridge Re Holdings Limited
2021 Omnibus Incentive Plan; and
3.
To consider and
vote upon a proposal to ratify the appointment of Hacker, Johnson
& Smith, P.A., as the independent auditors of the Company for
the fiscal year ended December 31, 2021.
Information
concerning the matters to be acted upon at the Meeting is set forth
in the accompanying Proxy Statement.
Only
shareholders of record, as shown by the transfer books of the
Company, at the close of business on April 23, 2021, will be
entitled to notice of, and to vote at, the Meeting or any
adjournments or postponements thereof. To be admitted to the annual
meeting, stockholders must enter their 16-digit control number
found on their proxy card. Whether or not you plan to attend the
Meeting, we hope you will vote as soon as possible. Voting your
proxy will ensure your representation at the Meeting. We urge you
to carefully review the proxy materials and to vote FOR the
election of each director nominee named in Proposal One, FOR the
approval of Oxbridge Re Holdings Limited 2021 Omnibus Incentive
Plan, and FOR Proposal Three.
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By
Order of the Board of Directors,
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Jay
Madhu
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Chief
Executive Officer
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April
30, 2021
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Grand
Cayman, Cayman Islands
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IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR
THE
VIRTUAL SHAREHOLDER MEETING TO BE HELD ON JUNE 2,
2021:
To access our Proxy Statement and our Annual Report to
Shareholders,
please visit www.proxyvote.com
or
www.oxbridgere.com/2021AGM
TABLE OF CONTENTS
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GENERAL INFORMATION
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1
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VOTING SECURITIES AND VOTE REQUIRED
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3
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SOLICITATION AND REVOCATION
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4
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PROPOSAL ONE ELECTION OF DIRECTORS OF THE COMPANY
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4
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PROPOSAL TWO APPROVAL OF THE COMPANY’S 2021 OMNIBUS INCENTIVE
PLAN
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7
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PROPOSAL THREE RATIFICATION OF THE COMPANY’S
AUDITORS
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19
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CORPORATE GOVERNANCE AND BOARD OF DIRECTORS
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19
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EXECUTIVE OFFICERS
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23
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DIRECTOR COMPENSATION
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23
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SHAREHOLDER COMMUNICATION
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23
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EXECUTIVE COMPENSATION
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23
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AUDIT COMMITTEE REPORT
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27
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INDEPENDENT PUBLIC ACCOUNTANT FEES AND SERVICES
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28
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PRINCIPAL SHAREHOLDERS
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28
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CERTAIN RELATIONSHIPS AND RELATED-PARTY TRANSACTIONS
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30
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OTHER MATTERS
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30
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ADDITIONAL INFORMATION
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31
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OXBRIDGE RE HOLDINGS LIMITED
Suite 201
42 Edward Street
P.O. Box 469
Grand Cayman, KY1-9006
Cayman Islands
PROXY STATEMENT
ANNUAL GENERAL MEETING OF SHAREHOLDERS
TO BE HELD ON JUNE 2, 2021
GENERAL INFORMATION
This
Proxy Statement is furnished in connection with the solicitation by
the Board of Directors of Oxbridge Re Holdings Limited (the
“Company”) of proxies for use at the Annual General
Meeting of Shareholders of the Company (the “Meeting”
or “Annual Meeting”) to be held via a live webcast on
Tuesday, June 2, 2021 at 9:00 a.m. (Central Time), and at any and
all adjournments or postponements thereof, for the purposes set
forth in the accompanying Notice of Annual General Meeting of
Shareholders. You are invited to attend the virtual Annual
Meeting to vote on the proposals described in this proxy statement
by joining the webcast available
at virtualshareholdermeeting.com/OXBR2021. You do not need to
attend the virtual Annual Meeting to vote your shares. Instead, you
may simply complete, sign and return the enclosed proxy card or
voting instruction form, if you received paper copies of the proxy
materials, or follow the instructions below to submit your proxy
over the telephone or the Internet. The Company’s
Annual Report to Shareholders is included with this Proxy Statement
for informational purposes and not as a means of soliciting your
proxy.
This
Proxy Statement and the accompanying proxy card and Notice of
Annual General Meeting of Shareholders are expected to be provided
to shareholders on or about May 7, 2021.
Matters
to be Voted Upon at the Meeting
You are
being asked to consider and vote upon the following
proposals:
1.
To elect four
directors to serve on the Board of Directors of the Company (our
“Board”) until the Annual General Meeting of
Shareholders of the Company in 2021 (“Proposal
One”);
2.
To approve the
Oxbridge Re Holdings Limited 2021 Omnibus Incentive Plan
(“Proposal Two”); and
3.
To ratify the
appointment of Hacker, Johnson & Smith, P.A., as the
independent auditors of the Company for the fiscal year ending
December 31, 2020 (“Proposal Three”).
Voting
Procedures
As a
shareholder of the Company, you have a right to vote on certain
matters affecting the Company. The proposals that will be presented
at the Meeting and upon which you are being asked to vote are
discussed above. Each ordinary share of the Company you owned as of
the record date, April 23, 2021, entitles you to one vote on each
proposal presented at the Meeting, subject to certain provisions of
our Third Amended and Restated Memorandum and Articles of
Association (our “Articles”), as described below under
“Voting Securities and Vote Required.”
Attending
the Virtual Annual Meeting
You may
attend the Annual Meeting online, including the ability to vote
and/or submit questions, by joining the webcast available at
virtualshareholdermeeting.com/OXBR2021. The
Annual Meeting will begin at approximately 9:00 a.m. Central Time,
with log-in beginning at 8:45 a.m., on June 2, 2021.
You are
entitled to participate in the virtual Annual Meeting only if you
were a shareholder of record who owned the Company's ordinary
shares at the close of business on April 23, 2021. Each holder of
record is entitled to one vote per share. There were 5,733,587
ordinary shares outstanding and entitled to vote.
Stockholder of Record: Shares Registered in Your Name
If, at the close of business on April 23, 2021,
your shares were registered directly in your name with our transfer
agent, Broadridge Corporate Issuer Solutions, then you are a stockholder of record. As a
stockholder of record, you may vote at the virtual Annual Meeting
through virtualshareholdermeeting.com/OXBR2021 or vote by
proxy prior to the virtual Annual Meeting. Whether or not you plan
to attend the virtual Annual Meeting, we urge you to vote your
shares by proxy by completing, signing, dating and mailing your
proxy card in the envelope provided, if you received paper copies
of the proxy materials, or vote your shares by proxy over the
telephone or the Internet as instructed below to ensure your vote
is counted.
Beneficial Owner: Shares Registered in the Name of a Broker, Bank
or Other Agent
If,
at the close of business on April 23, 2021, your shares were held,
not in your name, but rather in an account at a brokerage firm,
bank, dealer, or other similar organization, then you are the
beneficial owner of shares held in “street name” and
these proxy materials are being forwarded to you by that
organization. The organization holding your account is considered
to be the stockholder of record for purposes of voting at the
virtual Annual Meeting. As a beneficial owner, you have the right
to direct your broker, bank or other agent regarding how to vote
the shares in your account. You are also invited to attend the
virtual Annual Meeting; however, since you are not the stockholder
of record, you may not vote your shares online at the virtual
Annual Meeting unless you request and obtain a valid proxy from
your broker, bank or other agent.
Methods
of Voting
If
you are a stockholder of record, you may vote at the virtual Annual
Meeting, vote by proxy using the enclosed proxy card (if you
received paper copies of the proxy materials), vote by proxy over
the telephone, or vote by proxy over the Internet. Whether or not
you plan to attend the virtual Annual Meeting, we urge you to vote
by proxy to ensure your vote is counted. You may still attend the
virtual Annual Meeting and vote at that time even if you have
already voted by proxy.
Voting by Mail. You may vote
by signing the proxy card and returning it in the prepaid and
addressed envelope enclosed with the proxy materials. If you vote
by mail, we encourage you to sign and return the proxy card even if
you plan to attend the Meeting so that your shares will be voted if
you are unable to attend the Meeting.
Voting by Telephone. To vote
by telephone, dial toll-free
1-800-690-6903 using a touch-tone phone and follow the recorded
instructions. Please have available the 16-digit control number
from the proxy card, if you received one, or from your
Notice. If you vote by telephone, you do not need to
complete and mail a proxy card. Telephone voting is available
through 11:59 p.m. (local time) on June 1, 2021, the day prior to
the Meeting day.
Voting over the Internet. To vote over
the Internet, go to
http://www.proxyvote.com. Please have available the 16-digit
control number from the proxy card, if you received one, or from
your Notice. If you vote over the Internet, you do not need
to complete and mail a proxy card. Internet voting is available
through 11:59 p.m. (local time) on June 1, 2021, the day prior to
the Meeting day.
Voting virtually at the Meeting.
To vote virtually at the
Meeting, log in to the Meeting using the website
throughvirtualshareholdermeeting.com/OXBR2021. Please have
available the 16-digit control number from the enclosed proxy card,
if you received one, or from your Notice.
VOTING SECURITIES AND VOTE REQUIRED
As of
April 23, 2021, the record date for the determination of persons
entitled to receive notice of, and to vote at, the Meeting (the
“Record Date”), 5,733,587 ordinary shares were issued
and outstanding. The ordinary shares are our only class of equity
securities outstanding and entitled to vote at the
Meeting.
Subject
to the provisions of the Articles, each ordinary share is entitled
to one vote per share. However, under the Articles, the Board shall
reduce the voting power of any holder that holds 9.9% or more of
the total issued and outstanding ordinary shares (such person, a
“9.9% Shareholder”) to the extent necessary such that
the holder ceases to be a 9.9% Shareholder. In connection with this
reduction, the voting power of the other shareholders of the
Company may be adjusted pursuant to the terms of the Articles.
Accordingly, certain holders of ordinary shares may be entitled to
more than one vote per share subject to the 9.9% restriction in the
event that our Board is required to make an adjustment on the
voting power of any 9.9% Shareholder.
Voting
Reduction
The
applicability of the voting power reduction provisions to any
particular shareholder depends on facts and circumstances that may
be known only to the shareholder or related persons. Accordingly,
we request that any holder of ordinary shares with reason to
believe that it is a 9.9% Shareholder, contact us promptly so that
we may determine whether the voting power of such holder’s
ordinary shares should be reduced. By submitting a proxy, a holder
of ordinary shares will be deemed to have confirmed that, to its
knowledge, it is not, and is not acting on behalf of, a 9.9%
Shareholder. The directors of the Company are empowered to require
any shareholder to provide information as to that
shareholder’s beneficial ownership of ordinary shares, the
names of persons having beneficial ownership of the
shareholder’s ordinary shares, relationships with other
shareholders or any other facts the directors may consider relevant
to the determination of the number of ordinary shares attributable
to any person. The directors may disregard the votes attached to
ordinary shares of any holder who fails to respond to such a
request or who, in their judgment, submits incomplete, or
inaccurate information. The directors retain certain discretion to
make such final adjustments that they consider fair and reasonable
in all the circumstances as to the aggregate number of votes
attaching to the ordinary shares of any shareholder to ensure that
no person shall be a 9.9% Shareholder at any time.
Quorum;
Vote Required
The
attendance of two or more persons representing, virtually or by
proxy, more than 50% in par value of the issued and outstanding
ordinary shares as of the Record Date, is necessary to constitute a
quorum at the Meeting.
Assuming that a
quorum is present, the affirmative vote of the holders of a simple
majority of the issued and outstanding ordinary shares voted at the
Meeting is required for election of each of the director nominees
in Proposal One and for the approval of Proposal Two and Proposal
Three.
With
regard to any proposal or director nominee, votes may be cast in
favor of or against such proposal or director nominee or a
shareholder may abstain from voting on such proposal or director
nominee. Abstentions will be excluded entirely from the vote and
will have no effect except that abstentions and “broker
non-votes” will be counted toward determining the presence of
a quorum for the transaction of business.
Generally, broker
non-votes occur when ordinary shares held by a broker for a
beneficial owner are not voted on a particular proposal because the
broker has not received voting instructions from the beneficial
owner, and the broker does not have discretionary authority to vote
on a particular proposal.
Recommendation
Our
Board recommends that the shareholders take the following actions
at the Meeting:
1.
Proposal One: to vote FOR the election
of each of the four director nominees to serve on the Board until
the Annual General Meeting of Shareholders of the Company in 2022;
and
2.
Proposal Two: to vote FOR the approval
the Oxbridge Re Holdings Limited 2021 Omnibus Incentive Plan;
and
3.
Proposal Three: to vote FOR the
ratification of the appointment of Hacker, Johnson &
Smith, P.A., as the independent auditors of the Company for the
fiscal year ending December 31, 2021.
SOLICITATION AND REVOCATION
Proxies
must be received by us by 11:59 p.m. (local time) on June 1, 2021,
the day prior to the Meeting day. A shareholder may revoke his or
her proxy at any time up to one hour prior to the commencement of
the Meeting.
To do
this, you must:
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enter a new vote by
telephone, over the Internet or by signing and returning another
proxy card at a later date;
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file a written revocation
with the Secretary of the Company at our address set forth
above;
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file a duly executed proxy
bearing a later date; or
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appear virtually at the
Meeting and vote virtually.
A
shareholder of record may revoke a proxy by any of these methods,
regardless of the method used to deliver the shareholder’s
previous proxy. If your ordinary shares are held in street name,
you must contact your broker, dealer, commercial bank, trust
company, or other nominee to revoke your proxy.
The
individuals designated as proxies in the proxy card are officers of
the Company.
All
ordinary shares represented by properly executed proxies that are
returned, and not revoked, will be voted in accordance with the
instructions, if any, given thereon. If no instructions are
provided in an executed proxy, it will be voted FOR the election of
each director nominee named in Proposal One and FOR Proposal Two
and Proposal Three, and in accordance with the proxy holder’s
best judgment as to any other business that may properly come
before the Meeting. If a shareholder appoints a person other than
the persons named in the enclosed form of proxy to represent him or
her, such person should vote the shares in respect of which he or
she is appointed proxy holder in accordance with the directions of
the shareholder appointing him or her.
PROPOSAL ONE
ELECTION OF DIRECTORS OF THE COMPANY
Our
Articles currently provide that our Board shall consist of not less
than four (4) directors (exclusive of alternate directors). We
currently have four directors serving on our Board, and our Board
has nominated those four directors – Jay Madhu, Krishna
Persaud, Ray Cabillot, and Mayur Patel – for re-election as
directors to serve until the Annual General Meeting of Shareholders
of the Company in 2022.
Our
Board has no reason to believe that any of these director nominees
will not continue to be a candidate or will not be able to serve as
a director of the Company if elected. In the event that any nominee
is unable to serve as a director, the proxy holders named in the
accompanying proxy have advised that they will vote for the
election of such substitute or additional nominee(s) as our Board
may propose. Our Board unanimously recommends that you vote FOR the
election of each of the nominees.
Director
Nominees
Each of
the director nominees is currently serving as a director of the
Company and is standing for re-election. Unless otherwise directed,
the persons named in the proxy intend to vote all proxies FOR the
election of each of the following director nominees:
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Name
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Age
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Position
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Director Since
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Jay
Madhu(3)(5)
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54
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Chairman of the
Board of Directors, Chief Executive Officer, and
President
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2013
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Krishna
Persaud(1)(2)(4)(5)
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59
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Director
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2013
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Ray
Cabillot(1)(2)(3)(4)(5)
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58
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Director
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2013
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Mayur
Patel, M.D.(1)(2)(3)(4)
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65
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Director
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2013
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_______________
(1) Member of Audit
Committee.
(2) Member of
Compensation Committee.
(3) Member of
Underwriting Committee.
(4) Member of
Nominating and Corporate Governance Committee.
(5) Member of
Investment Committee.
The
nominees have consented to serve as directors of the Company if
elected.
Set
forth below is biographical information concerning each nominee for
election as a director of the Company, including a discussion of
such nominee’s particular experience, qualifications,
attributes, or skills that led our Nominating and Corporate
Governance Committee and our Board to conclude that the nominee
should serve as a director of our Company.
Jay Madhu. Mr. Madhu
has served as our Chief Executive Officer and President, and as a
director of our Company, since April 2013, and has served as
Chairman of the Board since January 2018. Mr. Madhu has also
served, since April 2013, as a director and the Chief Executive
Officer and President of our reinsurance subsidiary, Oxbridge
Reinsurance Limited. Mr. Madhu has also been a director of HCI
Group, Inc., a publicly traded holding company owning subsidiaries
primarily engaged in the property and casualty insurance business,
since May 2007. He also served as the President of Greenleaf
Capital, the real estate division of HCI Group, Inc., from June
2011 through June 2013 and as Vice President of Investor Relations
for HCI Group, Inc. from February 2008 through June 2013.
Mr. Madhu also served as Vice President of Marketing for HCI
Group, Inc. from 2008 to 2011. In his various positions at HCI
Group, Inc., Mr. Madhu’s responsibilities included
marketing, investor relations and management and oversight of HCI
Group’s real estate division. He has also been a director of
HCI Group’s wholly owned subsidiary, Claddaugh Casualty
Insurance Company Ltd (“Claddaugh”), since July 2010.
From August 2013 to April 2014, Mr. Madhu has served on the
board of directors of First Home Bancorp, Inc., a bank holding
company in Seminole, Florida. Mr. Madhu also served on the
board of directors of Wheeler Real Estate Investment Trust, Inc., a
publicly held real estate investment trust, from 2012 to June 2014.
As an owner and manager of commercial properties, Mr. Madhu
has been President of 5th Avenue Group LC, a real estate management
company, since 2002 and was President of Forrest Terrace LC, a real
estate management company, from 1999 until 2010. In addition,
Mr. Madhu is an investor in banking and health maintenance
organizations. He was also President of The Mortgage Corporation
Network (correspondent lenders) from 1996 to 2011. Prior to that,
Mr. Madhu was Vice President, mortgage division, at First
Trust Mortgage & Finance, from 1994 to 1996; Vice
President, residential first mortgage division, at Continental
Management Associates Limited, Inc., from 1993 to 1994; and
President, S&S Development, Inc. from 1991 to 1993. He attended
Northwest Missouri State University, where he studied marketing and
management.
Mr. Madhu
brings considerable business and marketing experience to our
Board.
Krishna Persaud.
Mr. Persaud has been a director of our Company
since April 2013. He has also been, since April 2013, a director of
our reinsurance subsidiary, Oxbridge Reinsurance Limited.
Mr. Persaud is a founder and the President, since June 2002,
of KPC Properties, LLC, a real estate investment firm, where he
leverages his knowledge and experience to identify opportunities to
add value to real properties in the state of Florida. He implements
a strategy of acquiring, adding value and relinquishing or holding
the improved asset. He has demonstrated consistent success in
implementing his strategy in real estate investments. Since June
2002, Mr. Persaud has been an asset manager, demonstrating the
ability to consistently exceed average market returns. From May
2007 to May 2011, Mr. Persaud was a director of HCI Group,
Inc., a publicly traded holding company owning subsidiaries
primarily engaged in the property and casualty insurance business.
Mr. Persaud received an award from the Tampa Bay INDOUS
Chamber of Commerce as one of the most successful businessmen of
the year in Tampa. Previously, he spent ten years working with
several consulting firms and municipalities providing design and
construction management services for a wide variety of building
systems and public works projects. Mr. Persaud earned his
Bachelor of Science degree in Mechanical Engineering and a
Master’s Degree in Civil Engineering from City College of
City University of New York. He holds licenses as a Professional
Engineer in the States of Florida, New York, and
California.
Mr. Persaud
brings considerable investment experience to our
Board.
Ray Cabillot.
Mr. Cabillot has been a director of our Company
since April 2013. He has also been, since April 2013, a director of
our reinsurance subsidiary, Oxbridge Reinsurance Limited. Since
1998, Mr. Cabillot has served as Chief Executive Officer and
director of Farnam Street Capital, Inc., the General Partner of
Farnam Street Partners L.P., a private investment partnership.
Prior to his service at Farnam Street Capital, Mr. Cabillot
was a Senior Research Analyst at Piper Jaffrey, Inc., an investment
bank and asset management firm, from 1989 to 1997. Early in his
career, Mr. Cabillot worked for Prudential Capital Corporation
as an Associate Investment Manager and as an Investment Manager.
Mr. Cabillot is currently a director for Pro-Dex, Inc. (PDEX)
and Air T Inc. (AIRT) and several private companies and, from 2006
to 2010, served as director and Chairman of the board for O.I.
Corporation (OICO). Mr. Cabillot earned his BA in economics
from St. Olaf College and an MBA from the University of Minnesota.
He is a Chartered Financial analyst (CFA).
Mr. Cabillot
brings considerable investment expertise to our Board.
Mayur Patel, M.D.
Dr. Mayur Patel has been a
director of our Company since October 2013. From 1989 until his
retirement in April 2020, he was a full-time practicing physician
in the field of diagnostic radiology and molecular imaging. In
April 2020, Dr. Patel retired from active practice of medicine
after a career spanning four decades. From 1997 until his
retirement in April 2020, he was a founding partner and practicing
physician with American Radiology Services (“ARS”),
based in Baltimore Maryland. During his tenure, he practiced
Radiology at three hospitals and several freestanding imaging
centers. Dr. Patel also played an active role in administrative and
financial function of the group. During his tenure he served as an
elected member of the Board of Directors of American Radiology
Associates, and in addition served on the finance, retirement and
quality assurance committees. He has published many peer reviewed
articles and also coauthored a book chapter in the field of
diagnostic radiology and molecular imaging. He has held academic
appointments as an Assistant Professor of Radiology at University
of Vermont, School of Medicine (1989-1992) and at University of
Maryland, School of Medicine (1989 -2000). Dr. Patel is a double
board-certified physician and a diplomat of the American Board of
Radiology and American Board of Nuclear Medicine. Outside of
medicine, Dr. Patel has 25 years of experience in investing in the
public markets as well as in private equity offerings. Dr. Patel is
the brother-in-law of Paresh Patel, our former chairman of the
Board who resigned from our Board of Directors effective December
31, 2017.
Dr. Patel
brings considerable investment experience to our
Board.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT
SHAREHOLDERS
VOTE “FOR” THE ELECTION OF EACH OF THE DIRECTOR
NOMINEES NAMED ABOVE.
PROPOSAL TWO
APPROVAL OF THE COMPANY’S 2021 OMNIBUS INCENTIVE
PLAN
The
Board has adopted the Oxbridge Re Holdings Limited 2021 Omnibus
Incentive Plan (the “Plan”), subject to approval by our
shareholders at the Meeting. If approved by our shareholders, the
Plan will allow for the granting of equity and cash incentive
awards to eligible individuals, including the issuance of up to
1,000,000 of our ordinary shares under the Plan. Awards under the
Plan are intended to support the creation of long-term value and
business returns for our shareholders. In addition, the Plan
is intended to advance the Company’s growth and success and
its interests by attracting and retaining well-qualified
Non-Employee Directors upon whose judgment the Company is largely
dependent for the successful conduct of its operations and by
providing such individuals with incentives to put forth maximum
efforts for the long-term success of the Company’s
business.
Summary
of the Terms of the Plan
The following is a summary of
the material provisions of the Plan, a copy of which is attached
hereto as Appendix
A and incorporated by reference herein. This summary is
qualified in its entirety by reference to the full and complete
text of the Plan. Any inconsistencies between this summary and the
text of the Plan will be governed by the text of the
Plan.
Purpose
and Effective Date
The two
complementary purposes of the Plan are (1) to attract, retain,
focus and motivate our and our affiliates’ executives and
other selected employees, directors, consultants and advisors and
(2) to increase shareholder value. The Plan will become effective
if approved by our shareholders at the Meeting.
Administration
and Eligibility
The
Compensation Committee of the Board, or any successor committee
with similar authority which the Board may appoint, which in either
case consists of not less than two members of the Board who meet
the “non-employee director” requirements of Rule
16b-3(b)(3) under the Securities Exchange Act of 1934 (the
“Exchange Act”) (either referred to as the
“Committee”) will administer the Plan (the
“Administrator”). The Plan authorizes the Committee to
interpret the provisions of the Plan; prescribe, amend and rescind
rules and regulations relating to the Plan; correct any defect,
supply any omission, or reconcile any inconsistency in the Plan,
any award or any agreement covering an award; and make all other
determinations necessary or advisable for the administration of the
Plan, in each case in its sole discretion. The Board may also
administer the Plan to the extent it retains authority and
responsibility as administrator of the Plan. Notwithstanding
anything in the Plan to the contrary, the Administrator is
authorized to grant to newly hired or promoted participants awards
with any vesting condition, any vesting period or any performance
period. The Administrator also may accelerate or shorten the
vesting or performance period of an award, in connection with a
participant’s death, disability, retirement or termination by
us or our affiliates without cause or a change of control of our
Company.
To the
extent applicable law permits, the Board may delegate to another
committee of the Board, or the Committee may delegate to one or
more officers of the Company, any or all of their respective
authority and responsibility as an administrator of the Plan.
However, no such delegation is permitted with respect to
stock-based awards made to any participant who is subject to the
reporting requirements of Section 16(a) of the Exchange Act or the
liability provisions of Section 16(b) of the Exchange Act at the
time any such delegated authority or responsibility is exercised
unless the delegation is to another committee of the Board
consisting entirely of non-employee directors.
The
Administrator may designate any of the following as a participant
from time to time, to the extent of the Administrator’s
authority: any officer or other employee of the Company or its
affiliates; any individual that the Company or an affiliate has
engaged to become an officer or employee; any consultant or advisor
who provides services to the Company or its affiliates; or any
director, including a non-employee director. Currently, the persons
eligible to participate in the Plan consist of approximately three
employees and three non-employee directors.
Types
of Awards
The
Plan permits the grant of options (including incentive share
options), share appreciation rights, restricted shares, restricted
share units, performance shares, performance units, annual cash
incentives, long-term cash incentives, dividend equivalent units
and other types of share-based awards. These award types are
described in further detail below.
Stock
Subject to the Plan
The
Plan provides that 1,000,000 of our ordinary shares are reserved
for issuance under the Plan. The number of ordinary shares reserved
under the Plan will be depleted by the maximum number of shares, if
any, that may be issuable under an award at the time of
grant.
In
general, if an award granted under the Plan lapses, expires,
terminates or is cancelled without the issuance of shares under the
award, if it is determined during or at the conclusion of the term
of an award that all or some portion of the shares under the award
will not be issuable on the basis that the conditions for such
issuance will not be satisfied, if shares are forfeited under an
award or if shares are issued under an award and we reacquire them
pursuant to rights reserved upon the issuance of the shares, then
such shares will again be available for issuance under the Plan,
except that shares reacquired pursuant to reserved rights may not
be issued pursuant to incentive share options. Shares tendered in
payment of the exercise price of an option, shares withheld to
satisfy tax withholding obligations and shares purchased by us
using proceeds from option exercises may not be recredited to the
reserve.
Options
The
Administrator will generally determine all terms and conditions of
each option. However, the grant date may not be any day prior to
the date that the Administrator approves the grant, the exercise
price may not be less than the fair market value of the shares
subject to the option as determined on the date of grant (other
than in the case of an Option that is not an incentive share option
and that complies with Section 409A of the Internal Revenue Code of
1986 (the “Code”)) and the option must terminate no
later than ten years after the date of grant. Unless restricted by
the Administrator, and subject to such procedures as the
Administrator may specify, the payment of the exercise price of
options may be made (1) by delivery of cash or other shares or
other securities of the Company having a then fair market value
equal to the purchase price of such shares, (2) by delivery to the
Company or its designated agent of an executed irrevocable option
exercise form together with irrevocable instructions to a
broker-dealer to sell or margin a sufficient portion of the shares
and deliver the sale or margin loan proceeds directly to the
Company to pay for the exercise price, (3) by surrendering the
right to receive shares otherwise deliverable to the participant
upon exercise of the award having a fair market value at the time
of exercise equal to the total exercise price, or (4) by any
combination of (1), (2) and/or (3). Except to the extent otherwise
set forth in an award agreement, a participant will have no rights
as a holder of our ordinary shares as a result of the grant of an
option until the option is exercised, the exercise price and
applicable withholding taxes are paid and the shares subject to the
option are issued thereunder.
Share
Appreciation Rights
The
Administrator will generally determine all terms and conditions of
each share appreciation right. A share appreciation right
(“SAR”) is the right of a participant to receive cash
in an amount, and/or ordinary shares with a fair market value,
equal to the appreciation of the fair market value of one of our
ordinary shares during a specified period of time. However, the
grant date may not be any day prior to the date that the
Administrator approves the grant, the grant price may not be less
than the fair market value of the shares subject to the share
appreciation right as determined on the date of grant (unless such
SAR complies with Code Section 409A) and the share appreciation
right must terminate no later than ten years after the date of
grant.
Performance
and Share Awards
The
Administrator will generally determine all terms and conditions of
each award of shares, restricted shares, restricted share units,
performance shares or performance units. Restricted shares means
ordinary shares that are subject to a risk of forfeiture,
restrictions on transfer or both a risk of forfeiture and
restrictions on transfer. Restricted share unit means the right to
receive a payment equal to the fair market value of one of our
ordinary shares. Performance share means the right to receive
ordinary shares, including restricted shares, to the extent
performance goals are achieved. Performance unit means the right to
receive a payment valued in relation to a unit that has a
designated dollar value or the value of which is equal to the fair
market value of one or more of our ordinary shares, to the extent
performance goals are achieved. The terms and conditions that the
Administrator will determine include the length of the vesting
and/or performance period and, if different, the date on which
payment of the benefit provided under the Award will be
made.
Incentive
Awards
The
Administrator has the authority to grant annual and long-term
incentive awards. Incentive awards are the right to receive a cash
payment to the extent performance goals are achieved. The
Administrator will determine all of the terms and conditions of
each incentive award, including the performance goals, the
performance period, the potential amount payable and the timing of
payment, provided that the Administrator must require that payment
of all or any portion of the amount subject to the award is
contingent on the achievement of one or more performance goals
during the period the Administrator specifies, although the
Administrator may specify that all or a portion of the goals are
deemed achieved upon a participant’s death, disability or
retirement, or such other circumstances as the Administrator may
specify. For long-term incentive awards, the performance period
must relate to a period of more than one fiscal year.
Dividend
Equivalent Units
The
Administrator has the authority to grant dividend equivalent units
in connection with awards other than options, share appreciation
rights or other share rights within the meaning of Code Section
409A. A dividend equivalent unit is the right to receive a payment,
in cash or ordinary shares, equal to the cash dividends or other
distributions that we pay with respect to an ordinary share. No
dividend equivalent unit granted in tandem with another award may
include vesting provisions more favorable to the participant than
the vesting provisions, if any, to which the tandem award is
subject.
Other
Share-Based Awards
The
Administrator may grant to participants other types of awards that
may be denominated or payable in, valued in whole or in part by
reference to, or otherwise based on, our ordinary shares, either
alone or in addition to or in conjunction with other awards, and
payable in our ordinary shares or cash. Subject to the limits of
the Plan, an award may include the issuance of unrestricted
ordinary shares, which may be awarded in payment of director fees,
in lieu of cash compensation, in exchange for cancellation of a
compensation right, as a bonus, or upon the attainment of
performance goals or otherwise, or rights to acquire ordinary
shares from us. The Administrator will generally determine all
terms and conditions of the award, except that any award that
provides for purchase rights must be priced at 100% of fair market
value on the date of the award.
Performance Goals
For
purposes of the Plan, performance goals means any subjective or
objective goals the Administrator establishes, in its discretion
with respect to an Award. Performance goals may, without
limitation, relate to one or more of the following with respect to
the Company or any one or more of its subsidiaries, affiliates or
other business units: gross premiums written; gross premiums
earned; net premiums written; net premiums earned; modeled probable
maximum loss (“PML”); PML to premium ratios; modeled
average annual loss (“AAL”); AAL to premium ratios;
reinsurance costs; book value; revenue; cash flow; total
shareholder return; dividends; debt; net cash provided by operating
activities; net cash provided by operating activities less net cash
used in investing activities; ratio of debt to debt plus equity;
profit before tax; gross profit; net profit; net operating profit;
net operating profit after taxes; net sales; earnings before
interest and taxes; earnings before interest, taxes, depreciation,
and/or amortization (“EBITDA”); Fair Market Value of
Shares; basic earnings per share; EBITDA excluding charges for
share compensation, management fees, restructurings, impairments
and/or other specified items (“Adjusted EBITDA”);
EBITDA excluding capital expenditures; basic or diluted earnings
per share or improvement in basic or diluted earnings per share;
revenues (including, but not limited to, total revenues, net
revenues or revenue growth); net operating profit; growth in basic
or diluted book value; financial return measures (including, but
not limited to, return on assets, capital, invested capital,
investments, investment income generated by underwriting or other
operations or on the float from such operations, equity, or
revenue) including or excluding negative returns, and with or
without compounding; cash flow measures (including, but not limited
to, operating cash flow, free cash flow, cash flow return on
equity, and cash flow return on investment); productivity ratios
(including but not limited to measuring liquidity, profitability or
leverage); enterprise value; share price (including, but not
limited to, growth measures and total shareholder return, inclusive
or exclusive of dividends); expense/cost management targets
(including but not limited to improvement in or attainment of
expense levels, capital expenditure levels, and/or working capital
levels); margins (including, but not limited to, operating margin,
underwriting margins, net income margin, cash margin, gross, net or
operating profit margins, EBITDA margins, Adjusted EBITDA margins);
operating efficiency; market share or market penetration; customer
targets (including, but not limited to, customer growth or customer
satisfaction); working capital targets or improvements; profit
measures (including but not limited to gross profit, net profit,
operating profit, investment profit and/or underwriting profit),
including or excluding charges for share compensation, fee income,
underwriting losses incurred in prior periods, changes in IBNR
reserves and/or other specified items; economic value added;
balance sheet metrics (including, but not limited to, inventory,
inventory turns, receivables turnover, net asset turnover, debt
reduction, retained earnings, year-end cash, cash conversion cycle,
ratio of debt to equity or to EBITDA); workforce targets (including
but not limited to diversity goals, employee engagement or
satisfaction, employee retention, and workplace health and safety
goals); implementation, completion or attainment of measurable
objectives with respect to risk management, research and
development, key products or key projects, lines of business,
acquisitions and divestitures and strategic plan development and/or
implementation; comparisons with various stock market indices, peer
companies or industry groups or classifications with regard to one
more of these criteria; or a combination of the
foregoing.
Except
to the extent otherwise determined by the Administrator, as to each
performance goal, the relevant measurement of performance will be
computed in accordance with generally accepted accounting
principles to the extent applicable, but will exclude the effects
of the following: (1) charges for reorganizing and restructuring;
(2) discontinued operations; (3) asset write-downs; (4) gains or
losses on the disposition of a business; (5) changes in tax or
accounting principles, regulations or laws; (6) mergers,
acquisitions, dispositions or recapitalizations; (7) impacts on
interest expense, preferred dividends and share dilution as a
result of debt and capital transactions; (8) extraordinary, unusual
and/or non-recurring items of income, expense, gain or loss, that,
in case of each of the foregoing, the Company identifies in its
publicly filed periodic or current reports, its audited financial
statements, including notes to the financial statements, or the
Management’s Discussion and Analysis section of the
Company’s annual report; (9) realized capital gains and
losses except for periodic settlements and accruals on non-hedge
derivative instruments; (10) valuation changes on imbedded
derivatives that are not hedged; (11) after tax effect of
catastrophe losses; and (12) any settlement, award or claim paid as
a result of lawsuits or other proceedings brought against the
Company or any one or more of its subsidiaries or affiliates
regarding the scope and nature of coverage provided under an
insurance policy issued by such company. Performance goals may be
expressed in terms of attaining a specified level of the particular
criterion or the attainment of an increase or decrease (expressed
as absolute numbers, averages and/or percentages) in the particular
criterion or achievement in relation to a peer group or other
index. The performance goals also may include a threshold level of
performance below which no payment will be made (or no vesting will
occur), levels of performance at which specified payments will be
paid (or specified vesting will occur), and a maximum level of
performance above which no additional payment will be made (or at
which full vesting will occur).
Effect
of Termination of Employment or Service on Awards
If a
participant has in effect an employment, retention, change of
control, severance or similar agreement with the Company or its
affiliates that discusses the effect of the participant’s
termination of employment or service on that participant’s
awards under the Plan, then such agreement shall control. In any
other case, except as otherwise provided by the Administrator in an
award agreement or as otherwise determined by the Administrator
prior to or at the time of termination of the participant’s
employment or service, the following provisions shall apply upon a
participant’s termination of employment or service with the
Company and its affiliates.
Termination of Employment or Service
If a
participant’s service with the Company and its affiliates as
an employee or a director ends for any reason other than (i) a
termination for Cause (as defined in the Plan), (ii) death, (iii)
Disability (as defined in the Plan), or (iv) Retirement (as defined
in the Plan), then any outstanding unvested options or SARs shall
be forfeited immediately upon such termination, and any outstanding
vested options or SARs shall be exercisable until the earlier of
(A) six months following the participant’s termination date
and (B) the expiration date of the option or SAR under the terms of
the applicable award agreement; provided that, if the option was
granted to a director, then the vested options or SARs shall be
exercisable until the earlier of twelve months following the
participant’s termination date and the expiration date. All
other outstanding awards made to the participant, to the extent not
then earned, vested or paid to the participant, shall terminate on
the participant’s last day of employment or
service.
Death, Disability or Retirement of Participant
If a
participant dies during employment with the Company and its
affiliates or while a director, or if a participant’s service
terminates as a result of Disability or Retirement,
then:
●
all outstanding
options or SARs shall become fully vested and exercisable by the
participant or, in the case of death, by the participant’s
estate or the person who has acquired the right to exercise such
awards by bequest or inheritance, as follows:
◦
in the case of the
participant’s death, until the earlier of twelve months
following the date of the participant’s death and the
expiration date of the option or SAR;
◦
in the case of a
termination as a result of Disability, until the earlier of twelve
months following the date of the termination and the expiration
date of the option or SAR; or
◦
in the case of a
termination as a result of Retirement, until the earlier of ten
years following the date of the participant’s Retirement and
the expiration date of the option or SAR.
All
restrictions on all outstanding awards of restricted shares or
restricted units that are not performance awards, including all
related dividend equivalent units, shall be deemed to have lapsed,
and such awards shall become fully vested, upon the date of death
or termination, as applicable.
All
outstanding awards of performance shares and performance units,
including all related dividend equivalent units, shall be paid in
either unrestricted ordinary shares or cash, as the case may be,
following the end of the performance period and based on
achievement of the performance goals established for such awards,
as if the participant had not died or terminated service, as
applicable, but prorated based on the portion of the performance
period that the participant has completed at the time of death or
termination of service.
All
other outstanding awards made to the participant, to the extent not
then earned, vested or paid to the participant, shall terminate on
the participant’s last day of employment or
service.
Termination for Cause
If a
participant’s employment with the Company and its affiliates
or service as a director is terminated for Cause, all awards and
grants of every type, whether or not then vested, shall terminate
no later than the participant’s last day of employment. The
Committee shall have discretion to waive the application of this
provision in whole or in part and to determine whether the event or
conduct at issue constitutes Cause for termination.
Consultants and Other Stock-Based Awards
The
Administrator shall have the discretion to determine, at the time
an award is made, the effect of the termination of service of a
consultant on awards held by such individual, and the effect on
other share-based awards of the participant’s termination of
employment or service with the Company and its
affiliates.
Transferability
of Awards
Awards
under the Plan generally will be nontransferable, unless the
Administrator otherwise permits.
Adjustments
Under
the terms of the Plan, if any of the following occurs:
● the Company is
involved in a merger or other transaction in which its ordinary
shares are changed or exchanged;
● the Company
subdivides or combines its ordinary shares or declares a dividend
payable in ordinary shares, other securities or other
property;
● the Company effects
a cash dividend, the amount of which, on a per share basis, exceeds
10% of the fair market value of an ordinary share at the time the
dividend is declared, or the Company effects any other dividend or
other distribution on ordinary shares in the form of cash, or a
repurchase of ordinary shares, that the Board determines is special
or extraordinary in nature or that is in connection with a
transaction that the Company characterizes publicly as a
recapitalization or reorganization involving the ordinary shares;
or
● any other event
occurs, which, in the judgment of the Board or Committee
necessitates an adjustment to prevent an increase or decrease in
the benefits or potential benefits intended to be made available
under the Plan;
then
the Administrator will, in a manner it deems equitable to prevent
an increase or decrease in the benefits or potential benefits
intended to be made available under the Plan and subject to certain
provisions of the Code, adjust the number and type of ordinary
shares subject to the Plan and which may, after the event, be made
the subject of awards; the number and type of ordinary shares
subject to outstanding awards; the grant, purchase or exercise
price with respect to any award; and performance goals of an
award.
In any
such case, the Administrator may also provide for a cash payment to
the holder of an outstanding award in exchange for the cancellation
of all or a portion of the award (without the consent of the
holder) in an amount and at a time determined by the
Administrator.
No such
adjustments may be authorized in the case of incentive share
options to the extent that such authority would cause the Plan to
violate Code Section 422(b).
Without
limitation, if there is a reorganization, merger, consolidation,
combination or other similar corporate transaction or event,
whether or not constituting a change of control (other than any
such transaction in which the Company is the continuing corporation
and in which the outstanding ordinary shares are not being
converted into or exchanged for different securities, cash or other
property, or any combination thereof), the Administrator may
substitute for each share then subject to an award and the shares
subject to the Plan the number and kind of shares, other
securities, cash or other property to which holders of our ordinary
shares will be entitled in respect of each share pursuant to the
transaction.
In the
case of a share dividend (other than a share dividend declared in
lieu of an ordinary cash dividend) or subdivision or combination of
the shares (including a reverse share split), if no action is taken
by the Administrator, the adjustments described above will
automatically be made.
In
connection with any merger, consolidation, acquisition of property
or shares, or reorganization, the Administrator may authorize the
issuance or assumption of awards under the Plan.
Change
of Control
Unless
otherwise expressly provided in an award agreement or another
contract, or under the terms of a transaction constituting a change
of control, the Administrator may provide for the acceleration of
the vesting or earning and, if applicable, exercisability of any
outstanding award, or portion thereof, or the lapsing of any
conditions or restrictions on or the time for payment in respect of
any outstanding award, or portion thereof, upon a change of control
or the termination of the participant’s employment following
a change of control.
In
addition, unless otherwise expressly provided in an award agreement
or another contract, or under the terms of a transaction
constituting a change of control, the Administrator may provide
that any or all of the following will occur in connection with a
change of control:
●
the substitution
for the shares subject to any outstanding award of securities of a
surviving corporation or any successor corporation to the Company,
or a parent or subsidiary, in which case the aggregate purchase or
exercise price, if any, of the award, or portion thereof, will
remain the same,
●
the conversion of
any outstanding award into a right to receive cash or other
property upon or following the consummation of the change of
control in an amount equal to the value of the consideration to be
received by holders of our ordinary shares in connection with such
transaction for one share, less the per share purchase or exercise
price of the award, if any, multiplied by the number of shares
subject to the award,
●
acceleration of the
vesting (and, as applicable, the exercisability) of any and/or all
outstanding awards,
●
the cancellation of
any outstanding and unexercised awards upon or following the
consummation of the change of control (without the consent of an
award holder or any person with an interest in an
award),
●
in the case of
options or share appreciation rights, the cancellation of all
outstanding options or share appreciation rights in exchange for a
cash payment equal to the excess of the change of control price (as
defined in the Plan) over the exercise price of the shares subject
to the option or share appreciation right upon the change of
control (or for no cash payment if such excess is zero),
and/or
●
the cancellation of
any awards in exchange for a cash payment based on the value of the
award as of the date of the change of control (or for no payment if
the award has no value).
The
terms of any awards that are subject to Code Section 409A will
govern the treatment of such awards upon a change of control to the
extent required for such awards to remain compliant with Code
Section 409A, as applicable.
“Change of
control” under the Plan means the occurrence of any one of
the following:
●
Any person (other
than an employee benefit plan of the Company or of any subsidiary
of the Company and fiduciaries and certain other parties related to
any of these plans) becomes the beneficial owner of securities of
the Company representing 50% or more of the combined voting power
of the Company’s then outstanding securities;
●
The Company is
merged or consolidated with any other corporation or other entity,
other than a merger or consolidation which would result in the
voting securities of the Company outstanding immediately prior
thereto continuing to represent more than 50% of the combined
voting power of the voting securities of the Company or such
surviving entity outstanding immediately after such merger or
consolidation or the Company engages in a merger or consolidation
effected to implement a recapitalization of the Company (or similar
transaction) in which no person acquires 50% or more of the
combined voting power of the Company’s then outstanding
securities. Notwithstanding the foregoing, a merger or
consolidation involving the Company shall not be considered a
change of control if the Company is the surviving corporation and
shares are not converted into or exchanged for stock or securities
of any other corporation, cash or any other thing of value, unless
persons who beneficially owned shares outstanding immediately prior
to such transaction own beneficially less than a majority of the
outstanding voting securities of the Company immediately following
the merger or consolidation;
●
The Company or any
affiliate sells, assigns or otherwise transfers assets in a
transaction or series of related transactions, if the aggregate
market value of the assets so transferred exceeds 50% of the
Company’s consolidated book value, determined by the Company
in accordance with generally accepted accounting principles,
measured at the time at which such transaction occurs or the first
of such series of related transactions occurs; provided, however,
that such a transfer effected pursuant to a spin-off or split-up
where shareholders of the Company retain ownership of the
transferred assets proportionate to their pro rata ownership
interest in the Company shall not be a change of
control;
●
The Company
dissolves and liquidates substantially all of its assets;
or
●
At any time when
the “continuing directors” cease to constitute a
majority of the Board. For this purpose, a “continuing
director” means the individuals who, at the effective date of
the Plan, constitute the Board and any new directors (other than
directors designated by a person who has entered into an agreement
with the Company to effect a change of control transaction) whose
appointment to the Board or nomination for election by company
shareholders was approved by a vote of at least two-thirds of the
then-serving continuing directors.
If an
award is considered deferred compensation subject to the provisions
of Code Section 409A, then the Administrator may include an amended
definition of “change of control” in the award
agreement issued with respect to such award as necessary to comply
with, or as necessary to permit a deferral under, Code Section
409A.
The
Plan does not provide for a “gross-up” for any excise
taxes imposed on golden parachute payments under Code Section 4999.
Rather, except to the extent the participant has in effect an
employment or similar agreement with the Company or any affiliate
or is subject to a policy that provides for a more favorable result
to the participant, if any payments or benefits paid by the Company
pursuant to the Plan would cause some or all of such payments or
benefits in conjunction with any other payments or benefits in
connection with a change of control to be subject to the tax
imposed by Code Section 4999, then these payments will either be
cut back to a level below the amount triggering the tax or be
delivered in full, whichever will provide the greater after-tax
benefit to the participant.
Termination
and Amendment
The
Plan will terminate on the tenth (10th) anniversary of the
effective date of the Plan, subject to the Board’s right to
terminate the Plan earlier at any time. In addition, the Board or
the Administrator may amend the Plan at any time,
except:
●
the Board must
approve any amendment to the Plan if we determine such approval is
required by prior action of the Board, applicable corporate law or
any other applicable law;
●
shareholders must
approve any amendment to the Plan if we determine that such
approval is required by Section 16 of the Exchange Act, the listing
requirements of any principal securities exchange or market on
which our ordinary shares are then traded, or any other applicable
law; and
●
shareholders must
approve any amendment to the Plan that materially increases the
number of ordinary shares reserved under the Plan or that
diminishes the provisions prohibiting repricing or backdating stock
options and share appreciation rights.
The
Administrator generally may modify, amend or cancel any award or
waive any restrictions or conditions applicable to any award or the
exercise of the award. Any modification or amendment that
materially diminishes the rights of the participant or any other
person that may have an interest in the award, or that cancels any
award, will be effective only if agreed to by that participant or
other person. The Administrator does not need to obtain participant
or other interested party consent, however, for the adjustment or
cancellation of an award pursuant to the adjustment provisions of
the Plan or the modification of an award to the extent deemed
necessary to comply with any applicable law or the listing
requirements of any principal securities exchange or market on
which our ordinary shares are then traded, to the extent the
Administrator deems necessary to preserve favorable accounting or
tax treatment of any award for the Company, or to the extent the
Administrator determines that the action does not materially and
adversely affect the value of an award or that such action is in
the best interest of the affected participant or any other
person(s) with an interest in the award.
The
authority of the Administrator to terminate or modify the Plan or
awards will extend beyond the termination date of the Plan. In
addition, termination of the Plan will not affect the rights of
participants with respect to awards previously granted to them, and
all unexpired awards will continue in force after termination of
the Plan except as they may lapse or be terminated by their own
terms and conditions.
Cancellation,
Disgorgement and Recoupment of Awards
The
Committee may cancel an award or require a participant to return to
us any compensation received under an award in certain
circumstances, such as if the participant is terminated for cause
or breaches any restrictive covenants, such as a non-compete, with
us. In addition, all awards will be subject to any recoupment or
clawback policy that we adopt from time to time.
Repricing
Prohibited
Neither the
Administrator nor any other person may: (1) amend the terms of
outstanding options or share appreciation rights to reduce the
exercise price of such outstanding options or share appreciation
rights; (2) cancel outstanding options or share appreciation rights
in exchange for options or share appreciation rights with an
exercise price that is less than the exercise price of the original
options or share appreciation rights; or (3) cancel outstanding
options or share appreciation rights with an exercise price above
the current share price in exchange for cash or other
securities.
Backdating
Prohibited
The
Administrator may not grant an option or share appreciation right
with a grant date that is effective prior to the date the
Administrator takes action to approve such award.
Foreign
Participation
To
assure the viability of awards granted to participants employed or
residing in foreign countries, the Administrator may provide for
such special terms as it may consider necessary or appropriate to
accommodate differences in local law, tax policy, accounting or
custom. Moreover, the Administrator may approve such supplements
to, or amendments, restatements or alternative versions of, the
Plan as it determines is necessary or appropriate for such
purposes. Any such amendment, restatement or alternative versions
that the Administrator approves for purposes of using the Plan in a
foreign country will not affect the terms of the Plan for any other
country.
Certain
U.S. Federal Income Tax Consequences Applicable to U.S.
Taxpayers
IRS Circular 230 Notice Requirement. This communication is not
given in the form of a covered opinion, within the meaning of
Circular 230 issued by the United States Secretary of the Treasury.
Thus, we are required to inform participants that they cannot rely
upon any tax advice contained in this communication for the purpose
of avoiding United States federal tax penalties. In addition, any
tax advice contained in this communication may not be used to
promote, market or recommend a transaction to another
party.
The tax
consequences of stock options and other awards granted under the
Plan are complex and depend, in large part, on the surrounding
facts and circumstances. This section provides a brief summary of
certain significant U.S. federal income tax consequences of the
Plan under existing U.S. law. This summary is not a complete
statement of applicable law and is based upon the Code, the
regulations promulgated therein, as well as administrative and
judicial interpretations of the Code as in effect on the date of
this description. If U.S. federal tax laws, or the interpretations
of such laws, change in the future, the information provided in
this section may no longer be accurate. This section does not
discuss state, local, or non-U.S. tax consequences. This section
also does not discuss the effect of gift, estate, or inheritance
taxes.
Therefore, it is important that participants consult with their tax
advisor before taking any action with respect to any award such
participant receives under the Plan.
We are
not a U.S. taxpayer and, accordingly, awards under the Plan are not
expected to have direct U.S. federal income tax consequences to
us.
Options
The
grant of an option under the Plan will create no federal income tax
consequences to the recipient. A participant who is granted a
non-qualified option will generally recognize ordinary compensation
income at the time of exercise in an amount equal to the excess of
the fair market value of our ordinary shares at such time over the
exercise price. Upon the participant’s subsequent disposition
of the ordinary shares received with respect to such option, the
participant will recognize a capital gain or loss (long-term or
short-term, depending on the holding period) to the extent the
amount realized from the sale differs from the tax basis (i.e., the
fair market value of the ordinary shares on the exercise
date).
In
general, a participant will recognize no income or gain as a result
of the exercise of an incentive share option, except that the
alternative minimum tax may apply. Except as described below, the
participant will recognize a long-term capital gain or loss on the
disposition of our ordinary shares acquired pursuant to the
exercise of an incentive share option. If the participant fails to
hold the ordinary shares acquired pursuant to the exercise of an
incentive share option for at least two years from the grant date
of the incentive option and one year from the exercise date, then
the participant will recognize ordinary compensation income at the
time of the disposition equal to the lesser of the gain realized on
the disposition and the excess of the fair market value of our
ordinary shares on the exercise date over the exercise price. Any
additional gain realized by the participant over the fair market
value at the time of exercise will be treated as a capital
gain.
Share Appreciation Rights
The
grant of a share appreciation right under the Plan will create no
income tax consequences to the recipient. A participant who is
granted a share appreciation right will generally recognize
ordinary compensation income at the time of exercise in an amount
equal to the excess of the fair market value of our ordinary shares
at such time over the grant price. If the share appreciation right
is settled in our ordinary shares, upon the participant’s
subsequent disposition of such shares, the participant will
recognize a capital gain or loss (long-term or short-term,
depending on the holding period) to the extent the amount realized
from the sale differs from the tax basis (i.e., the fair market
value of the ordinary shares on the exercise date).
Restricted Shares
Generally, a
participant will not recognize income at the time an award of
restricted shares is made under the Plan, unless the participant
makes the election described below. A participant who has not made
such an election will recognize ordinary income at the time the
restrictions on the shares lapse in an amount equal to the fair
market value of the restricted shares at such time. Any otherwise
taxable disposition of the restricted shares after the time the
restrictions lapse will result in a capital gain or loss (long-term
or short-term, depending on the holding period) to the extent the
amount realized from the sale differs from the tax basis (i.e., the
fair market value of our ordinary shares on the date the
restrictions lapse). Dividends paid in cash and received by a
participant prior to the time the restrictions lapse will
constitute ordinary income to the participant in the year paid. Any
dividends paid in stock will be treated as an award of additional
restricted shares subject to the tax treatment described
herein.
A
participant may, within 30 days after the date of the award of
restricted shares, elect to recognize ordinary income as of the
date of the award in an amount equal to the fair market value of
such restricted shares on the date of the award (less the amount,
if any, the participant paid for such restricted shares). If the
participant makes the election, then any cash dividends the
participant receives with respect to the restricted shares will be
treated as dividend income to the participant in the year of
payment. Any otherwise taxable disposition of the restricted shares
(other than by forfeiture) will result in a capital gain or loss.
If the participant who has made an election subsequently forfeits
the restricted shares, then the participant will not be entitled to
claim a credit for the tax previously paid.
Restricted Share Units
A
participant will not recognize income at the time an award of a
restricted share unit is made under the Plan. Upon the
participant’s receipt of shares (or cash) at the end of the
restriction period, the participant will recognize ordinary income
equal to the amount of cash and/or the fair market value of the
shares received. If the restricted share units are settled in whole
or in part in shares, upon the participant’s subsequent
disposition of the shares the participant will recognize a capital
gain or loss (long-term or short-term, depending on the holding
period) to the extent the amount realized upon disposition differs
from the shares’ tax basis (i.e., the fair market value of
the shares on the date the participant received the
shares).
Performance Shares
The
grant of performance shares will create no income tax consequences
for the participant. Upon the participant’s receipt of shares
at the end of the applicable performance period, the participant
will recognize ordinary income equal to the fair market value of
the shares received, except that if the participant receives
restricted shares in payment of performance shares, recognition of
income may be deferred in accordance with the rules applicable to
restricted shares as described above. In addition, the participant
will recognize ordinary compensation income equal to the dividend
equivalents paid on performance shares prior to or at the end of
the performance period. Upon the participant’s subsequent
disposition of the shares, the participant will recognize a capital
gain or loss (long-term or short-term depending on the holding
period) to the extent the amount realized from the disposition
differs from the shares’ tax basis (i.e., the fair market
value of the shares on the date the participant received the
shares).
Performance Units
The
grant of a performance unit will create no income tax consequences
to the participant. Upon the participant’s receipt of cash
and/or shares at the end of the applicable performance period, the
participant will recognize ordinary income equal to the amount of
cash and/or the fair market value of the shares received. If
performance units are settled in whole or in part in shares, upon
the participant’s subsequent disposition of the shares the
participant will recognize a capital gain or loss (long-term or
short-term, depending on the holding period) to the extent the
amount realized upon disposition differs from the shares’ tax
basis (i.e., the fair market value of the shares on the date the
participant received the shares).
Incentive Awards
A
participant who is paid an incentive award will recognize ordinary
income equal to the amount of cash paid.
Dividend Equivalent Units
A
participant who is paid a dividend equivalent with respect to an
award will recognize ordinary income equal to the value of cash or
common stock paid.
Code
Sections 409A
Awards
under the Plan may constitute, or provide for, a deferral of
compensation under Section 409A of the Code. If the requirements of
Code Section 409A are not complied with, then holders of such
awards may be taxed earlier than would otherwise be the case (e.g.,
at the time of vesting instead of the time of payment) and may be
subject to an additional 20% penalty tax and, potentially, interest
and penalties. The Plan is intended to permit compliance with Code
Section 409A and the Department of Treasury regulations and other
interpretive guidance that may be issued pursuant to Code Section
409A. To the extent that we determine that any award granted under
the Plan is subject to Code Section 409A, the award agreement
evidencing such award is expected generally to incorporate the
terms and conditions required by Code Section 409A. The Plan and
any applicable awards may be modified to exempt the awards from
Code Section 409A or comply with the requirements of Code Section
409A.
New
Plan Benefits
The
awards that may be granted under the Plan in the future to the
executive officers or non-employee directors named in this Proxy
Statement or to other officers, non-employee directors, employees,
or other persons cannot be determined at this time. The
Administrator will make such determinations from time to
time.
THE BOARD UNANIMOUSLY RECOMMENDS THAT SHAREHOLDERS VOTE
“FOR” THE APPROVAL OF THE COMPANY’S 2021 OMNIBUS
INCENTIVE PLAN.
PROPOSAL THREE
RATIFICATION OF THE COMPANY’S AUDITORS
Upon
recommendation of the Audit Committee of the Company, our Board
proposes that the shareholders ratify the appointment of Hacker,
Johnson & Smith, P.A. (“Hacker Johnson”) to
serve as the independent auditors of the Company for the fiscal
year ending December 31, 2021. Hacker Johnson served as the
independent auditors of the Company for the fiscal years ended
December 31, 2013 through December 31, 2020.
Although
ratification is not required by law, our Board believes that
shareholders should be given the opportunity to express their views
on the subject. In the event of a negative vote on such
ratification, the Audit Committee will reconsider its selection.
Even if this appointment is ratified, the Audit Committee, in its
discretion, may direct the appointment of a different independent
registered public accounting firm at any time during the year if
the Audit Committee determines that such a change would be in the
best interest of the Company and its shareholders.
We do
not expect that a representative of Hacker Johnson will attend the
Meeting.
THE BOARD OF DIRECTORS UNANIMOUSLY RECOMMENDS THAT
SHAREHOLDERS VOTE “FOR” THE RATIFICATION OF THE
APPOINTMENT OF HACKER
JOHNSON AS THE COMPANY’S AUDITOR.
CORPORATE GOVERNANCE AND BOARD OF DIRECTORS
Board
Leadership Structure and Risk Oversight
Our
Company’s Board does not have a current requirement that the
roles of Chief Executive Officer and Chairman of the Board be
either combined or separated because the Board believes it is in
the best interest of our Company to make this determination based
upon the position and direction of the Company and the constitution
of the Board. The Board regularly evaluates whether the roles of
Chief Executive Officer and Chairman of the Board should be
combined or separated.
Since
the Company’s formation in 2013 through to December 31, 2017,
the Company had bifurcated the positions of Chairman of the Board
and Chief Executive Officer. Paresh Patel had served as Chairman of
the Board since April 2013 through to his resignation in December
2017. Jay Madhu has served as Chief Executive Officer of the
Company since April 2013 and took on the additional role of
Chairman of the Board effective January 1, 2018.
Our
independent directors have determined that the most effective
leadership structure for our Company at the present time is for our
Chief Executive Officer to also serve as our Chairman of the Board.
Our independent directors believe that because our Chief Executive
Officer is ultimately responsible for our day-to-day operations and
for executing our business strategy, and because our performance is
an integral part of the deliberations of our Board, our Chief
Executive Officer is the director best qualified to act as Chairman
of the Board. Our Board retains the authority to modify this
structure to best address our unique circumstances, and so advance
the best interests of all stockholders, as and when
appropriate.
We have
three independent directors and one non-independent director. We
believe that the number of independent, experienced directors on
our Board provides the necessary and appropriate oversight for our
Company.
Management is
primarily responsible for assessing and managing the
Company’s exposure to risk. While risk assessment is
management’s duty, the Audit Committee is responsible for
discussing certain guidelines and policies with management that
govern the process by which risk assessment and control is handled.
The Audit Committee also reviews steps that management has taken to
monitor the Company’s risk exposure. In addition, the
Underwriting Committee approves and reviews our underwriting
policies and guidelines, oversees our underwriting process and
procedures, monitors our underwriting performance and oversees our
underwriting risk management exposure. Management focuses on the
risks facing the Company, while the Audit Committee and the
Underwriting Committee focus on the Company’s general risk
management strategies and oversee risks undertaken by the Company.
We believe this division of responsibilities is the most effective
approach for addressing the risks facing our Company and that our
Board leadership structure supports this approach.
Board
Committees and Meetings
Our
Board has five committees: an Audit Committee, a Compensation
Committee, a Nominating and Corporate Governance Committee, an
Underwriting Committee, and an Investment Committee. Each
committee, except for the Investment Committee, has a written
charter. The table below provides current membership information
for each of the committees.
|
|
|
|
|
|
Nominating and
|
|
|
|
|
|
|
Audit
|
|
Compensation
|
|
Corporate Governance
|
|
Underwriting
|
|
Investment
|
|
|
Committee
|
|
Committee
|
|
Committee
|
|
Committee
|
|
Committee
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Jay Madhu
|
|
|
|
|
|
|
X
|
|
X
|
|
|
|
|
|
|
|
|
|
|
|
|
Krishna Persaud
|
X
|
|
X*
|
|
X*
|
|
|
|
X
|
|
|
|
|
|
|
|
|
|
|
|
|
Ray Cabillot
|
X*
|
|
X
|
|
X
|
|
X
|
|
X*
|
|
|
|
|
|
|
|
|
|
|
|
|
Mayur Patel, M.D.
|
X
|
|
X
|
|
X
|
|
X*
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
# of meetings held in 2020
|
4
|
|
0
|
|
1
|
|
4
|
|
4
|
______________
* Committee
Chairperson
Our
Board held four meetings in 2020. Each of our directors attended at
least 75% of the meetings of the Board in 2020.
It is
our policy that directors are expected to attend the Annual General
Meeting of Shareholders in the absence of a scheduling conflict or
other valid reason. All of our
directors attended our 2020 Annual General Meeting of
Shareholders.
The
Board has determined that (1) Jay Madhu does not qualify as an
independent director under the applicable rules of The Nasdaq Stock
Market and the Securities and Exchange Commission
(“SEC”) and (2) Krishna Persaud, Ray Cabillot and
Mayur Patel qualify as independent directors under the applicable
rules of The Nasdaq Stock Market and the SEC.
The
Board has also determined that all of the current members of the
Audit Committee, the Compensation Committee, and the Nominating and
Corporate Governance Committee qualify as independent directors
under the applicable rules of The Nasdaq Stock Market and SEC and
that the current members of the Compensation Committee each qualify
as a “non-employee director” as defined in Section
16b-3 of the Exchange Act.
Below
is a description of each committee of our Board.
Audit
Committee
Our
Audit Committee consists of three members – Ray Cabillot,
Krishna Persaud, and Mayur Patel. Each of these individuals meets
all independence requirements for Audit Committee members set forth
in applicable SEC rules and regulations and the applicable rules of
The Nasdaq Stock Market. Ray Cabillot serves as Chairman of our
Audit Committee and qualifies as an “audit committee
financial expert” as that term is defined in the rules and
regulations established by the SEC.
The
Audit Committee has general responsibility for the oversight of our
accounting, reporting and financial control practices. The Audit
Committee is governed by a written charter approved by our Board,
which outlines its primary duties and responsibilities, and which
can be found on our website at www.oxbridgere.com.
Compensation
Committee
Our
Compensation Committee currently consists of three members –
Krishna Persaud, Mayur Patel, and Ray Cabillot. Krishna Persaud
serves as Chairman of our Compensation Committee. All of the current members of our
Compensation Committee qualify as independent directors under the
applicable rules of The Nasdaq Stock Market and as
“non-employee directors” under Section 16b-3 of the
Exchange Act.
The
purpose of our Compensation Committee is to discharge the
responsibilities of our Board relating to compensation of our Chief
Executive Officer and to make recommendations to our Board relating
to the compensation of our other executive officers. Our
Compensation Committee, among other things, assists our Board in
ensuring that a proper system of compensation is in place to
provide performance-oriented incentives to management. Our
Compensation Committee has the authority to delegate its
responsibilities to a subcommittee or to officers of the Company to
the extent permitted by applicable law and the compensation plans
of the Company if it determines that such delegation would be in
the best interest of the Company. Our Compensation Committee may
engage a compensation consultant; however, it did not engage a
compensation consultant with respect to executive or director
compensation for 2020.
The
Compensation Committee is governed by a written charter approved by
our Board, which outlines its primary duties and responsibilities,
and which can be found on our website at www.oxbridgere.com.
Nominating
and Corporate Governance Committee
Our
Nominating and Corporate Governance Committee is composed of three
members – Ray Cabillot, Mayur Patel, and Krishna Persaud.
Krishna Persaud serves as the Chairman of our Nominating and
Corporate Governance Committee. All of the members of our
Nominating and Corporate Governance Committee qualify as
independent directors under the applicable rules of The Nasdaq
Stock Market.
The
Nominating and Corporate Governance Committee makes recommendations
to our Board as to nominations for our Board and committee members,
as well as with respect to structural, governance, and procedural
matters. The Nominating and Corporate Governance Committee also
reviews the performance of our Board and the Company’s
succession planning. The Nominating and Corporate Governance
Committee is governed by a written charter approved by our Board,
which outlines its primary duties and responsibilities, and which
can be found on our website at www.oxbridgere.com.
The
Nominating and Corporate Governance Committee is responsible for
reviewing the criteria for the selection of new directors to serve
on the Board and reviewing and making recommendations regarding the
composition and size of the Board. When our Board decides to seek a
new member, whether to fill a vacancy or otherwise, the Nominating
and Corporate Governance Committee will consider recommendations
from other directors, management and others, including
shareholders. In general, the Nominating and Corporate Governance
Committee looks for directors possessing superior business judgment
and integrity who have distinguished themselves in their chosen
fields and who have knowledge or experience in the areas of
insurance, reinsurance, financial services or other aspects of the
Company’s business, operations or activities. In selecting
director candidates, the Nominating and Corporate Governance
Committee also considers the interplay of the candidate’s
experience with the experience of the other Board
members.
The
Nominating and Corporate Governance Committee will consider, for
director nominees, persons recommended by shareholders, who may
submit recommendations to the Nominating and Corporate Governance
Committee in care of the Company’s Secretary, at Suite 201,
42 Edward Street, P.O. Box 469, Grand Cayman, KY1-9006, Cayman
Islands. To be considered by the Nominating and Corporate
Governance Committee, such recommendations must be accompanied by a
description of the qualifications of the proposed candidate and a
written statement from the proposed candidate that he or she is
willing to be nominated and desires to serve if elected. Nominees
for director who are recommended by shareholders to the Nominating
and Corporate Governance Committee will be evaluated in the same
manner as any other nominee for director.
Underwriting
Committee
The
Underwriting Committee consists of three members – Mayur
Patel, Jay Madhu, and Ray Cabillot. Mayur Patel serves as Chairman
of our Underwriting Committee. The Underwriting Committee’s
responsibilities include approving and reviewing our underwriting
policies and guidelines, overseeing our underwriting process and
procedures, monitoring our underwriting performance and overseeing
our underwriting risk management exposure. The Underwriting
Committee is governed by a written charter approved by our Board,
which outlines its primary duties and responsibilities, and which
can be found on our website at www.oxbridgere.com.
Investment
Committee
The
Investment Committee consists of three members – Krishna
Persaud, Jay Madhu, and Ray Cabillot. Ray Cabillot serves as
Chairman of the Investment Committee. The Investment
Committee’s responsibilities include approving and reviewing
any changes to our investment guidelines, and monitoring investment
performance and market, credit and interest rate exposure as a
result of opportunistic investment decisions undertaken by
management. The Investment Committee is governed by investment
guidelines that have been approved by our Board. There is no
written charter for the Investment Committee.
Code
of Ethics
Our
Board has adopted a written Code of Business Conduct and Ethics
that applies to our principal executive officer, principal
financial officer, principal accounting officer or controller or
persons performing similar functions. We have posted a current copy
of the code on our website, www.oxbridgere.com,
in the “Investor Information” section of the website.
We intend to disclose any change to or waiver from our Code of
Business Conduct and Ethics by posting such change or waiver to our
internet web site within the same section as described
above.
EXECUTIVE OFFICERS
|
Name
|
|
Age
|
|
Position
|
|
Position Since
|
|
Jay
Madhu*
|
|
54
|
|
Chief
Executive Officer, President, and Chairman of the Board (Principal
Executive Officer)
|
|
2013
|
|
|
|
|
|
|
|
|
|
Wrendon
Timothy
|
|
40
|
|
Chief
Financial Officer and Secretary (Principal Financial and Accounting
Officer)
|
|
2013
|
* See
biography above under “Director Nominees”
Wrendon Timothy. Wrendon Timothy has
served as our Chief Financial Officer and Secretary since
August 2013. Mr. Timothy has over fifteen (15) years of
professional experience in business, audit and assurance service
both in Trinidad and the Cayman Islands. From September 2007
through July 2013, Mr. Timothy worked as an Audit Senior and
Audit Manager at PricewaterhouseCoopers Chartered Accountants in
the Cayman Islands, specializing in insurance and reinsurance
clients. From September 2005 through August 2007, Mr. Timothy
served as a Senior Accountant at KPMG Chartered Accountants in
Trinidad and Tobago. Mr. Timothy is a Fellow of the
Association of Chartered Certified Accountants and holds a
Postgraduate Diploma in Business Administration and a Master of
Business Administration, with Distinction (with Specialism in
Finance – with Distinction), from Heriott Watt University.
Mr. Timothy holds directorship with a number of privately-held
companies and not-for-profit organizations and is a member of the
Cayman Islands Institute of Professional Accountants (CIIPA) and an
Associate Member of the Chartered Governance Institute (formerly
known as the Institute of Chartered Secretaries and
Administrators).
DIRECTOR COMPENSATION
All directors, other than Mr. Madhu, are entitled
to receive compensation from us for their services as directors.
Under the Articles, our directors may receive compensation for
their services as may be determined by our Board. During
2020, none of our non-employee directors received cash or an
equity compensation award. Director fees paid in cash have been
indefinitely suspended since October 1, 2017.
SHAREHOLDER COMMUNICATION
Our
Board has adopted a policy for handling shareholder communications
to directors. Shareholders may send written communications to our
Board or any one or more of the individual directors by mail, c/o
Secretary, Oxbridge Re Holdings Limited, Suite 201, 42 Edward
Street, P.O. Box 469, Grand Cayman, KY1-9006, Cayman Islands. There
is no screening process, other than to confirm that the sender is a
shareholder and to filter inappropriate materials and unsolicited
materials of a marketing or publication nature. All shareholder
communications that are received by the Secretary of the Company
for the attention of a director or directors are forwarded to such
director or directors.
EXECUTIVE COMPENSATION
The
following table summarizes the compensation of our Named Executive
Officers, or “NEOs”, in 2020 and 2019.
SUMMARY
COMPENSATION TABLE
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Name and Principal Position
|
|
Year
|
|
|
|
|
|
|
|
|
|
Jay
Madhu
|
|
2020
|
$232,000
|
-
|
-
|
-
|
-
|
-
|
$5,305
|
$237,305
|
|
President and Chief Executive
Officer
|
|
2019
|
$232,000
|
$-
|
-
|
72,838
|
-
|
-
|
$5,305
|
$310,143
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Wrendon
Timothy
|
|
2020
|
$132,000
|
-
|
-
|
-
|
-
|
-
|
$5,305
|
$137,305
|
|
Chief Financial Officer and Corporate
Secretary
|
|
2019
|
$132,000
|
$-
|
-
|
32,777
|
-
|
-
|
$5,305
|
$170,082
|
(1)
All
option awards were granted under our 2014 Omnibus Incentive Plan.
The value reported above in the "Option Awards" column is the
aggregate grant date fair value for the NEO's option awards granted
in 2019, determined in accordance with FASB ASC Topic 718,
"Compensation—Stock Compensation". Assumptions used in the
calculation of these amounts are included in Note 11 of the Notes
to Consolidated Financial Statements in our Company’s Annual
Report on Form 10-K for the fiscal year ended December 31,
2020.
(2)
In both 2020 and 2019, Mr. Madhu received
$5,305 in company contributions to our defined contribution pension
plan. In both 2020 and 2019, Mr. Timothy received $5,305 in company
contributions to our defined contribution pension
plan.
GRANTS OF PLAN BASED AWARDS IN FISCAL YEAR 2020
During the year ended December 31, 2020, there
were no stock options or restricted stock awards granted under our
2014 Omnibus Stock Incentive Plan.
Employment
Agreements
Jay Madhu
On
July 18, 2013, we entered into an executive employment
agreement with Jay Madhu, our Chief Executive Officer and
President. Under the terms of this agreement, as amended,
Mr. Madhu’s employment commenced on July 18, 2013 and
continued for three years. Following this initial three-year term,
we extended Mr. Madhu’s employment for an additional
three-year term, after which the agreement will automatically renew
for additional one-year terms unless either party chooses not to
renew.
The
executive employment agreement entitles Mr. Madhu to receive:
(1) an annual base salary of $232,000, (2) additional
compensation granted by our Board (or a committee thereof) and
(3) medical, dental, life, disability, and retirement
benefits.
If
Mr. Madhu’s employment is terminated by us for good
cause or if Mr. Madhu terminates his employment with us, he
will be entitled to: (1) his accrued base salary and accrued
vacation pay and other paid time off, in each case through his date
of termination, and (2) reimbursement for expenses accrued
through his date of termination.
If
Mr. Madhu’s employment is terminated by us without good
cause, he will be entitled to: (1) his accrued base salary and
accrued vacation pay and other paid time off, in each case through
the date of termination, (2) reimbursement for expenses
accrued through his date of termination, and (3) the amount of
base salary that would have been payable through the term of the
agreement (excluding future automatic renewals) if his employment
had not been terminated. If such termination is within three years
following a change of control, Mr. Madhu will be entitled to
receive, in lieu of the amount described in clause
(3) directly above, an amount equal to 2.9 times the total
amount of his annual base salary. If Mr. Madhu’s
employment is terminated due to his death or incapacity, it will be
deemed to be a termination without good cause.
Mr. Madhu’s
executive employment agreement also contains non-compete and
non-solicitation provisions.
Wrendon Timothy
Wrendon
Timothy is our Chief Financial Officer and Secretary, and his
employment with us commenced on August 1, 2013. Under the
terms of this agreement, as amended, Mr. Timothy’s
employment commenced on August 1, 2013 and continued for three
years. Following this initial three-year term, we extended Mr.
Timothy’s employment for an additional three-year term, after
which the agreement will automatically renew for additional
one-year term unless either party chooses not to renew. Under the
agreed upon terms of employment, Mr. Timothy is entitled to
receive a basic gross salary of $132,000 per year, payable monthly.
His salary will be reviewed annually and may be adjusted at our
discretion. We will also pay the monthly premiums for
Mr. Timothy’s medical, dental, and vision insurance, and
match Mr. Timothy’s contributions to his pension plan.
Finally, Mr. Timothy will be eligible to receive a
discretionary bonus and any other compensation which will be based
on our financial performance and Mr. Timothy’s personal
performance.
We may
terminate Mr. Timothy’s employment without notice in the
event of serious or persistent misconduct or breach of the agreed
upon terms of Mr. Timothy’s employment or for cause. In
other circumstances, the party that wishes to terminate
Mr. Timothy’s employment must provide 60 days’
prior written notice.
OUTSTANDING
EQUITY AWARDS AT FISCAL YEAR-END 2020
The following table sets forth information regarding outstanding
stock option and restricted stock awards held by our NEOs at
December 31, 2020, including the number of shares underlying both
exercisable and unexercisable portions of each option as well as
the exercise price and expiration date of each outstanding
option;
|
|
Number of Securities Underlying Unexercised Options Exercisable
(#)
|
Number of Securities Underlying Unexercised Options Unexercisable
(#)
|
Equity Incentive Plan Awards: Number of Securities Underlying
Unexercised Unearned Options(#)
|
|
Option Expiration Date
|
Number of Shares or Units of Stock That Have Not
Vested(#)
|
Market Value of Shares or Units of Stock That Have Not Vested
($)
|
Equity Incentive Plan Awards: Number of Unearned Shares, Units or
Other Rights That Have Not Vested(#)
|
Equity Incentive Plan Awards: Market or Payout Value of Unearned
Shares, Units or Other Rights That Have Not Vested($)
|
|
|
|
|
|
|
|
|
|
|
|
|
Jay
Madhu
|
120,000(1)
|
-
|
-
|
$6.00
|
1/23/25
|
-
|
-
|
-
|
-
|
|
|
25,000
|
-
|
-
|
$6.00
|
1/16/26
|
-
|
-
|
-
|
-
|
|
|
25,000
|
-
|
-
|
$6.06
|
1/20/27
|
-
|
-
|
-
|
-
|
|
|
100,000
|
100,000
|
-
|
$2.00
|
3/16/29
|
-
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Wrendon
Timothy
|
60,000(2)
|
-
|
-
|
$6.00
|
1/23/25
|
-
|
-
|
-
|
-
|
|
|
10,000
|
-
|
-
|
$6.00
|
1/16/26
|
-
|
-
|
-
|
-
|
|
|
10,000
|
-
|
-
|
$6.06
|
1/20/27
|
-
|
-
|
-
|
-
|
|
|
45,000
|
45,000
|
-
|
$2.00
|
3/16/29
|
-
|
-
|
-
|
-
|
(1)
Mr. Madhu was awarded 120,000 stock options on January 23, 2015 and
25,000 stock options on January 16, 2016 and January 20, 2017, all
of which are fully vested. Mr. Madhu was also awarded 200,000 stock
options on March 16, 2019. The options vest quarterly in increments
of 12,500. The remaining 100,000 options will vest over the next 8
quarters, provided that Mr. Madhu remains employed by the
Company.
(2)
Mr. Timothy was awarded 60,000 stock options on January 23, 2015
and 10,000 stock options on January 16, 2016 and January 20, 2017,
all of which are fully vested. Mr. Timothy was also awarded 90,000
stock options on March 16, 2019. The options vest quarterly in
increments of 5,625. The remaining 45,000 options will vest over
the next 8 quarters, provided that Mr. Timothy remains employed by
the Company.
OPTION
EXERCISES AND STOCK VESTED IN FISCAL 2020
There were no stock awards vesting or options exercised by our
NEO’s during the year ended December 31,
2020.
AUDIT COMMITTEE REPORT
The
primary purpose of the Audit Committee is to assist the Board in
fulfilling its responsibilities relating to the general oversight
of the Company’s financial reporting process. The Audit
Committee conducts its oversight activities for the Company in
accordance with the duties and responsibilities outlined in the
Audit Committee charter.
The
Company’s management is responsible for the preparation,
consistency, integrity, and fair presentation of the financial
statements, accounting, and financial reporting principles, systems
of internal control, and procedures designed to ensure compliance
with accounting standards, applicable laws, and regulations. The
Company’s independent registered public accounting firm,
Hacker Johnson, is responsible for performing an independent audit
of the Company’s financial statements.
The
Audit Committee hereby reports as follows:
1.
The Audit Committee
has reviewed and discussed the audited financial statements of the
Company as of and for the year ended December 31, 2020 with
management.
2.
The Audit Committee
has discussed with Hacker Johnson, the Company’s independent
auditors for the year ended December 31, 2020, the matters required
to be discussed by Public Company Accounting Oversight Board
(“PCAOB”) Auditing Standard No. 16, Communications with
Audit Committees.
3.
The Audit Committee
has received the written disclosures and the letter from Hacker
Johnson required by applicable requirements of the PCAOB regarding
Hacker Johnson’s communications with the Audit Committee
concerning independence, and has discussed with Hacker Johnson its
independence.
4.
Based upon the
review and discussion referred to in paragraphs (1) through (3)
above, the Audit Committee recommended to the Board, and the Board
has approved, that the audited financial statements be included in
the Company’s Annual Report on Form 10-K for the year ended
December 31, 2020, for filing with the SEC.
THE AUDIT COMMITTEE
|
Raymond Cabillot, Chairman
|
|
|
|
|
|
Mayur Patel
Krishna Persaud
|
|
INDEPENDENT PUBLIC ACCOUNTANT FEES AND SERVICES
The
following table sets forth the aggregate fees for services related
to the years ended December 31, 2020 and 2019 as provided by
Hacker, Johnson & Smith PA, our principal
accountant:
|
|
|
|
|
Audit
Fees (a)
|
$52,000
|
$52,000
|
|
Audit-related
fees
|
-
|
-
|
|
Tax
fees
|
-
|
-
|
|
All
other fees
|
-
|
-
|
|
Total
|
$52,000
|
$52,000
|
(a)
Audit
Fees represent fees billed for professional services rendered for
the audit of our annual financial statements and review of our
quarterly financial statements included in our quarterly reports on
Form 10-Q. The above fees are exclusive of audit fees of $24,000
(2019: $24,000) paid / payable to EisnerAmper Cayman Ltd. for the
statutory audit of the company’s reinsurance subsidiaries,
Oxbridge Reinsurance Limited and Oxbridge Re NS.
Audit
Committee’s Pre-Approval Policies and Procedures
Our
Audit Committee charter includes our policy regarding the approval
of audit and non-audit services performed by our independent
auditors. The Audit Committee is responsible for retaining and
evaluating the independent auditors’ qualifications,
performance and independence. The Audit Committee pre-approves all
auditing services, internal control-related services and permitted
non-audit services (including the fees and terms thereof) to be
performed for us by our independent auditors, subject to such
exceptions for non-audit services as permitted by applicable laws
and regulations. The Audit Committee may delegate this authority to
a subcommittee consisting of one or more Audit Committee members,
including the authority to grant pre-approvals of audit and
permitted non-audit services, provided that decisions of such
subcommittee to grant pre-approvals are presented to the full Audit
Committee at its next meeting. Our Board approved all professional
services provided to us by Hacker, Johnson & Smith PA and EisnerAmper Cayman Ltd.
during 2020 and 2019.
PRINCIPAL SHAREHOLDERS
The
following table sets forth information regarding the beneficial
ownership of our ordinary shares as of April 23, 2021
by:
●
each person who is known by us to beneficially own more than
5% of our outstanding ordinary shares,
●
each of our directors and NEOs, and
●
all directors and executive officers as a group.
The
percentages of ordinary shares beneficially owned are based on the
5,733,587 ordinary shares outstanding as of April 23, 2021.
Information with respect to beneficial ownership has been furnished
by each director, executive officer and beneficial owner of more
than 5% of our ordinary shares. Beneficial ownership is determined
in accordance with the rules of the SEC and generally requires that
such person have voting or investment power with respect to the
securities. In computing the number of ordinary shares beneficially
owned by a person listed below and the percentage ownership of such
person, ordinary shares underlying options, warrants, or
convertible securities held by each such person that are
exercisable or convertible within 60 days of April 23, 2021 are
deemed outstanding, but are not deemed outstanding for computing
the percentage ownership of any other person. Except as otherwise
indicated in the footnotes to this table, or as required by
applicable community property laws, all persons listed have sole
voting and investment power for all ordinary shares shown as
beneficially owned by them. Unless otherwise indicated in the
footnotes, the address for each principal shareholder is in care of
Oxbridge Re Holdings Limited, at Suite 201, 42 Edward Street, P.O.
Box 469, Grand Cayman, KY1-9006, Cayman Islands.
|
|
|
|
|
|
|
|
|
|
|
Name of Beneficial Owners
|
Number of Ordinary Shares
|
|
|
5% Shareholders:
|
|
|
|
Allan
Martin
|
673,628(1)
|
10.69%
|
|
|
|
|
|
|
|
|
|
Named Executive Officers and Directors:
|
|
|
|
Jay
Madhu
|
662,437(2)
|
10.63%
|
|
Wrendon
Timothy
|
167,863(3)
|
2.86%
|
|
Krishna
Persaud
|
495,715(4)
|
8.15%
|
|
Mayur
Patel
|
367,000(5)
|
6.13%
|
|
Ray
Cabillot
|
89,270(6)
|
1.56%
|
|
All Executive Officers and Directors as a Group (5
persons)
|
1,782,284
|
25.56%
|
(1)
Consists of
175,998 ordinary shares issuable upon the exercise of warrants
held by Allan Martin and his wife, Marie Martin, jointly, that are
currently exercisable or exercisable within 60 days of April 23,
2021; 83,300 ordinary shares issuable upon the exercise of warrants
held by A. S. Martin Trust that are currently exercisable or
exercisable within 60 days of April 23, 2021; 21,665 ordinary
shares held by A. S. Martin Children Trust; and 21,665 ordinary
shares issuable upon the exercise of warrants held by A. S. Martin
Children Trust that are currently exercisable or exercisable within
60 days of April 23, 2021; 39,000 ordinary shares issuable upon the
exercise of warrants held by Martin Family Foundation that are
currently exercisable or exercisable within 60 days of April 23,
2021; 83,000 ordinary shares held by Fleur de Lis Partners, LLLP;
and 249,000 ordinary shares issuable upon the exercise of warrants
held by Fleur de Lis Partners, LLLP that are currently exercisable
or exercisable within 60 days of April 23, 2021. As the general
partner of Fleur de Lis Partners, LLLP, the trustee for A.S. Martin
Children Trust, and the chairman for Martin Family Foundation,
Mr. Martin has voting and investment power over the ordinary
shares and warrants held by each of these entities.
(2)
Consists of 125,231
ordinary shares held by Universal Finance & Investments,
L.C. and 203,768 ordinary shares issuable upon the exercise of
warrants held by Universal Finance & Investments, L.C.
that are currently exercisable. As the sole owner and manager of
Universal Finance & Investments, L.C., Mr. Madhu has
voting and investment power over the ordinary shares and warrants
held by that entity. Also includes 40,000 ordinary shares held in
Mr. Madhu’s name and 293,498 ordinary shares issuable upon
the exercise of stock options held by Mr. Madhu that are currently
exercisable or exercisable within 60 days of April 23,
2021.
(3)
Consists of 7,500
ordinary shares issuable upon the exercise of warrants held by
Mr. Timothy, individually, that are currently exercisable;
25,050 ordinary shares held by Mr. Timothy, individually; and
135,313 ordinary shares issuable upon the exercise of stock options
held by Mr. Timothy that are currently exercisable or exercisable
within 60 days of April 23, 2021.
(4)
Consists of 35,000
ordinary shares held by Krishna Persaud and his wife, Sumentra
Persaud, jointly; 105,000 ordinary shares issuable upon the
exercise of warrants held by Krishna Persaud and his wife, Sumentra
Persaud, jointly, that are currently exercisable; 118,000 ordinary
shares and 237,143 ordinary shares issuable upon the exercise of
warrants held by held by Krishna Persaud that are currently
exercisable; and 3,125 ordinary shares issuable upon the exercise
of stock options held by Mr. Persaud that are currently exercisable
or exercisable within 60 days of April 23, 2021. Mr. Persaud
and his wife share voting and investment power over the shares and
warrants held jointly in their names.
(5)
Consists of 118,000
ordinary shares held by Mayur Patel and his wife, Ulupi M. Patel,
jointly, and 249,000 ordinary shares issuable upon the exercise of
warrants held by Mayur Patel and his wife, Ulupi M. Patel, jointly,
and 3,125 ordinary shares issuable upon the exercise of stock
options held by Mr. Patel that are currently exercisable or
exercisable within 60 days of April 23, 2021.
(6)
Consists of 35,000
ordinary shares held by Ray Cabillot, individually and 3,125
ordinary shares issuable upon the exercise of stock options held by
Mr. Cabillot that are currently exercisable or exercisable within
60 days of April 23, 2021; 47,045 ordinary shares and 7,225
ordinary shares held by Farnam Street Capital for the benefit of
and as the General Partner of Farnam Street Partners and FS Special
Opportunities I Fund, respectively. As the general partner of
Farnam Street Capital, Mr. Cabillot has voting and investment
power over the ordinary shares and warrants held by that
entity.
CERTAIN RELATIONSHIPS AND RELATED-PARTY TRANSACTIONS
Reinsurance
and Other Contracts with Related Parties
We had
no reinsurance contracts or other material contracts with related
parties during the years ended December 31, 2020 and
2019.
Mr. Madhu is a
director of HCI Group and previously served as the President of its
real estate division and as its Vice President of Investor
Relations. Paresh Patel, the non-executive Chairman of our Board
through to December 31, 2017 and a beneficial owner of more than 5%
of our ordinary shares, is a founder of HCI Group and currently
serves as its Chief Executive Officer and as the Chairman of its
board of directors. Both Mr. Madhu and Mr. Patel are also
shareholders of HCI Group. However, neither of Mr. Madhu nor
Mr. Patel have any interest in any contracts between HCI Group
and our Company other than in their capacity as equity holders of
both of HCI Group and our Company.
During
the years ending December 31, 2020 and 2019, Mr. Jay Madhu, a
director and officer of the Company and its subsidiaries, invested
$68 thousand and $50 thousand, respectively, in participating notes
issued by Oxbridge Re NS, one of the Company’s reinsurance
subsidiaries.
Policies for Approval or Ratification of Transactions with Related
Persons
Our
policy for approval or ratification of transactions with related
persons is for those transactions to be reviewed and approved by
the Audit Committee. That policy is set forth in the Audit
Committee Charter. Our practice is that such transactions are
approved by a majority of disinterested directors. The policy sets
forth no standards for approval. Directors apply their own
individual judgment and discretion in deciding such
matters.
OTHER MATTERS
Neither
the Board nor management intends to bring before the Meeting any
business other than the matters referred to in the Notice of Annual
General Meeting of Shareholders and this Proxy Statement. If any
other business should come properly before the Meeting, or any
adjournment or postponement thereof, the proxy holders will vote on
such matters at their discretion.
ADDITIONAL INFORMATION
Other
Action at the Meeting
As of
the date of this Proxy Statement, the Company has no knowledge of
any business, other than as described herein and customary
procedural matters, which will be presented for consideration at
the Meeting. In the event any other business is properly presented
at the Meeting, the persons named in the accompanying proxy may,
but will not be obligated to, vote such proxy in accordance with
their judgment on such business.
Shareholder
Proposals for the Annual General Meeting of Shareholders in
2022
Pursuant to Rule
14a-8 of the Exchange Act, shareholder proposals must be received
in writing by the Secretary of the Company no later than 120 days
prior to the date of the Company’s proxy statement released
to shareholders in connection with the Company’s previous
year’s annual general meeting of shareholders and must comply
with the requirements of Cayman Islands corporate law and the
Articles in order to be considered for inclusion in the
Company’s proxy statement and form of proxy relating to the
annual general meeting of shareholders in 2022. Shareholder
proposals received by December 30, 2021 would be considered timely
for inclusion in the proxy statement relating to the 2022 annual
general meeting of shareholders. Any shareholder proposal for the
annual general meeting of shareholders in 2022, which is submitted
outside the processes of Rule 14a-8, shall be considered
untimely.
12
Under
our Articles, the Board shall call an extraordinary general meeting
upon receipt of signed “Members’ requisition” by
shareholders holding more than 66.66% in par value of the issued
shares which as of that date carry the right to vote at an
extraordinary general meeting of the Company. Such Members’
requisition must also contain the proposal to be considered at
(i.e. objects of) the meeting and must be signed by the
requisitionists and deposited at the registered office of the
Company. If the Board does not, within twenty-one days from the
date of the deposit of the Members’ requisition, duly proceed
to convene an extraordinary general meeting to be held within a
further twenty-one days, the requisitionists, or any of them
representing more than one-half of the total voting rights of all
the requisitionists, may themselves convene an extraordinary
general meeting, but any meeting so convened shall be held no later
than the day which falls three months after the expiration of the
said twenty-one day period. Any extraordinary general meeting
convened by the requisitionists shall be convened in the same
manner as nearly possible as that in which extraordinary general
meetings are convened by the Board.
Delivery
of Documents to Shareholders Sharing an Address
Some
companies, brokers, banks, and other holders of record may employ
procedures, approved by the SEC, known as
“householding.” Householding, which reduces costs
associated with duplicate printings and mailings, means that we
will send only one copy of our proxy materials to shareholders who
share the same address. Shareholders sharing the same address will
continue to receive separate proxy cards.
If you
own ordinary shares and would like to receive additional copies of
our proxy materials, you may submit a request to us by:
(i) mailing a request in writing to our Secretary at Suite
201, 42 Edward Street, P.O. Box 469, Grand Cayman, KY1-9006, Cayman
Islands, or (ii) calling us at 1-345-749-7570, and we will
promptly mail the requested copies to you. If you own ordinary
shares in your own name and you want to receive separate copies of
the proxy materials in the future, or if you receive multiple
copies and want to receive only one copy, contact Broadridge
Corporate Issuer Solutions at 1-877-830-4936. If you beneficially
own ordinary shares and you want to receive separate copies of the
proxy materials in the future, or if you receive multiple copies
and want to receive only one copy, contact your bank, broker or
other holder of record.
Costs
of Solicitation
The
entire cost of this proxy solicitation will be borne by the
Company, including expenses in connection with preparing,
assembling, printing and mailing proxy solicitation materials. In
addition to solicitation by mail, officers, directors, and
employees of the Company may solicit proxies by telephone,
facsimile, electronic communication, in person or via the Internet,
although no compensation will be paid for such
solicitation.
|
|
|
By
Order of the Board of Directors,
|
|
|
|
Jay
Madhu
Chief
Executive Officer
April
30, 2021
|
|
Grand
Cayman, Cayman Islands
|
APPENDIX A
OXBRIDGE RE HOLDINGS LIMITED
2021 OMNIBUS INCENTIVE PLAN
1. Purpose,
Effective Date and Definitions.
(a) Purpose.
Oxbridge Re Holdings Limited 2021 Omnibus Incentive Plan has two
complementary purposes: (i) to attract, retain, focus and motivate
executives and other selected employees, directors, consultants and
advisors and (ii) to increase shareholder value. The Plan will
accomplish these objectives by offering participants the
opportunity to acquire ordinary shares of the Company’s
common equity, receive monetary payments based on the value of such
ordinary shares or receive other incentive compensation on the
terms that this Plan provides. In addition, the Plan
is intended to advance the Company’s growth and success and
to advance its interests by attracting and retaining well-qualified
Non-Employee Directors upon whose judgment the Company is largely
dependent for the successful conduct of its operations and by
providing such individuals with incentives to put forth maximum
efforts for the long-term success of the Company’s
business.
(b) Effective Date. This Plan will become
effective, and Awards may be granted under this Plan, on and after
the date on which the Plan is approved
by the Company’s shareholders (the “Effective
Date”).
(c) Prior
Plan. If the
Company’s shareholders approve this Plan, then the Oxbridge
Re Holdings Limited 2014 Omnibus Incentive Plan (the “Prior
Plan”) will terminate on the Effective Date, and no new
awards will be granted under the Prior Plan after its termination
date; provided that the Prior Plan will continue to govern awards
outstanding as of the date of the Prior Plan’s termination
and such awards shall continue in force and effect until fully
distributed or terminated pursuant to their
terms.
(d) Definitions. Capitalized terms used and not otherwise defined
in various sections of the Plan have the meanings given in
Section 19.
2. Administration.
(a) Administration. In addition to the
authority specifically granted to the Administrator in this Plan,
the Administrator has full discretionary authority to administer
this Plan, including but not limited to the authority to:
(i) interpret the provisions of this Plan;
(ii) prescribe, amend and rescind rules and regulations
relating to this Plan; (iii) correct any defect, supply any
omission, or reconcile any inconsistency in the Plan, any Award or
any agreement covering an Award in the manner and to the extent it
deems desirable to carry this Plan or such Award into effect; and
(iv) make all other determinations necessary or advisable for
the administration of this Plan. All Administrator determinations
shall be made in the sole discretion of the Administrator and are
final and binding on all interested parties.
Notwithstanding
any provision of the Plan to the contrary, the Administrator shall
have the discretion to grant an Award with any vesting condition,
any vesting period or any performance period if the Award is
granted to a newly hired or promoted Participant, or accelerate or
shorten the vesting or performance period of an Award, in
connection with a Participant’s death, Disability, Retirement
or termination by the Company or an Affiliate without Cause or a
Change of Control.
(b) Delegation to Other Committees or
Officers. To the extent applicable law permits, the Board
may delegate to another committee of the Board, or the Committee
may delegate to one or more officers of the Company, any or all of
their respective authority and responsibility as an Administrator
of the Plan;provided that
no such delegation is permitted with respect to Share-based Awards
made to Section 16 Participants at the time any such delegated
authority or responsibility is exercised unless the delegation is
to another committee of the Board consisting entirely of
Non-Employee Directors who are also non-employee directors within
the meaning of Rule 16b-3(b)(3) promulgated under the Exchange Act.
If the Board or the Committee has made such a delegation, then all
references to the Administrator in this Plan include such other
committee or one or more officers to the extent of such
delegation.
(c) No Liability; Indemnification. No
member of the Board or the Committee, and no officer or member of
any other committee to whom a delegation under Section 2(b) has
been made, will be liable for any act done, or determination made,
by the individual in good faith with respect to the Plan or any
Award. The Company will indemnify and hold harmless each such
individual as to any acts or omissions, or determinations made,
with respect to this Plan or any Award to the maximum extent that
the law and the Company’s by-laws permit.
3. Eligibility.
The Administrator may designate any of the following as a
Participant from time to time, to the extent of the
Administrator’s authority: any officer or other employee of
the Company or its Affiliates; any individual that the Company or
an Affiliate has engaged to become an officer or employee; any
consultant or advisor who provides services to the Company or its
Affiliates; or any Director, including a Non-Employee Director. The
Administrator’s granting of an Award to a Participant will
not require the Administrator to grant an Award to such individual
at any future time. The Administrator’s granting of a
particular type of Award to a Participant will not require the
Administrator to grant any other type of Award to such
individual.
4. Types
of Awards; Assistance to Participants.
(a) Grants
of Awards. Subject to the terms of this Plan, the
Administrator may grant any type of Award to any Participant it
selects, but only employees of the Company or a Subsidiary (that
qualifies under Code Section 422) may receive grants of incentive
share options within the meaning of Code Section 422. Awards may be
granted alone or in addition to, in tandem with, or (subject to the
prohibition on repricing set forth in Section 15(e)) in
substitution for any other Award (or any other award granted under
another plan of the Company or any Affiliate, including the plan of
an acquired entity).
(b) Assistance. On such terms and
conditions as shall be approved by the Administrator, the Company
or any Subsidiary may directly or indirectly lend money to any
Participant or other person to accomplish the purposes of the Plan,
including to assist such Participant or other person to acquire
Shares upon the exercise of Options, provided that such lending is not
permitted to the extent it would violate terms of the
Sarbanes-Oxley Act of 2002 or any other law, regulation or other
requirement applicable to the Company or any
Subsidiary.
5. Shares
Reserved under this Plan.
(a) Plan Reserve. Subject to adjustment as
provided in Section 17, an aggregate of one million (1,000,000)
Shares are reserved for issuance under this Plan, all of which may
be issued upon the exercise of incentive share options within the
meaning of Code Section 422. The Shares reserved for issuance may
be either authorized and unissued Shares or shares reacquired at
any time and now or hereafter held in treasury. The aggregate
number of Shares reserved under this Section 5(a) shall be depleted
by the maximum number of Shares, if any, that may be issuable under
an Award as determined at the time of grant. For purposes of
determining the aggregate number of Shares reserved for issuance
under this Plan, any fractional Share shall be rounded to the next
highest full Share.
(b) Replenishment of Shares Under this
Plan. If (i) an Award lapses, expires, terminates or is
cancelled without the issuance of Shares under the Award (whether
due currently or on a deferred basis), (ii) it is determined
during or at the conclusion of the term of an Award that all or
some portion of the Shares with respect to which the Award was
granted will not be issuable, or that other compensation with
respect to the Shares covered by the Award will not be payable, on
the basis that the conditions for such issuance will not be
satisfied, (iii) Shares are forfeited under an Award or (iv) Shares
are issued under any Award and the Company subsequently reacquires
them pursuant to rights reserved upon the issuance of the Shares,
then such Shares shall be recredited to the Plan’s reserve
and may again be used for new Awards under this Plan, but Shares
recredited to the Plan’s reserve pursuant to clause (iv) may
not be issued pursuant to incentive share options.
(c) Participant Limitations. Subject to
adjustment as provided in Section 17, no Participant may be
granted Awards that could result in such Participant:
(i) receiving Options
for, and/or Share Appreciation Rights with respect to, more than
200,000 Shares during any fiscal year of the Company;
(ii) receiving
Awards of Restricted Shares and/or Restricted Share Units, and/or
other Share-based Awards pursuant to Section 12, relating to more
than 100,000 Shares during any fiscal year of the
Company;
(iii) receiving
Awards of Performance Shares, and/or Awards of Performance Units
the value of which is based on the Fair Market Value of Shares, for
more than 100,000 Shares during any fiscal year of the Company;
or
(iv) receiving
Awards of Performance Units the value of which is not based on the
Fair Market Value of Shares, Annual Incentive Award(s), Long-Term
Incentive Award(s) or Dividend Equivalent Unit(s) that would pay
more than $2,000,000 to the Participant during any single fiscal
year of the Company.
6. Options.
Subject to the terms of this Plan, the Administrator will determine
all terms and conditions of each Option, including but not limited
to: (a) whether the Option is an “incentive share
option” which meets the requirements of Code
Section 422, or a “nonqualified share option”
which does not meet the requirements of Code Section 422; (b)
the grant date, which may not be any day prior to the date that the
Administrator approves the grant; (c) the number of Shares subject
to the Option; (d) the exercise price, which may not be less than
the Fair Market Value of the Shares subject to the Option as
determined on the date of grant (other than in the case of an
Option that is not an incentive share option and that complies with
Code Section 409A); (e) the terms and conditions of vesting and
exercise; and (f) the term, except that an Option must terminate no
later than ten (10) years after the date of grant. In all
other respects, the terms of any incentive share option should
comply with the provisions of Code Section 422 except to the
extent the Administrator determines otherwise. Except to the extent
the Administrator determines otherwise, a Participant may exercise
an Option in whole or part after the right to exercise the Option
has accrued, provided that
any partial exercise must be for one hundred (100) Shares or
multiples thereof. If an Option that is intended to be an incentive
share option fails to meet the requirements thereof, the Option
shall automatically be treated as a nonqualified share option to
the extent of such failure. Unless restricted by the Administrator,
and subject to such procedures as the Administrator may specify,
the payment of the exercise price of Options made be made by (w)
delivery of cash or other Shares or other securities of the Company
(including by attestation) having a then Fair Market Value equal to
the purchase price of such Shares, (x) by delivery (including by
fax) to the Company or its designated agent of an executed
irrevocable option exercise form together with irrevocable
instructions to a broker-dealer to sell or margin a sufficient
portion of the Shares and deliver the sale or margin loan proceeds
directly to the Company to pay for the exercise price, (y) by
surrendering the right to receive Shares otherwise deliverable to
the Participant upon exercise of the Award having a Fair Market
Value at the time of exercise equal to the total exercise price, or
(z) by any combination of (w), (x) and/or (y). Except to the extent
otherwise set forth in an Award agreement, a Participant shall have
no rights as a holder of Shares as a result of the grant of an
Option until the Option is exercised, the exercise price and
applicable withholding taxes are paid and the Shares subject to the
Option are issued thereunder.
7. Share
Appreciation Rights. Subject to the terms of this Plan, the
Administrator will determine all terms and conditions of each SAR,
including but not limited to: (a) whether the SAR is granted
independently of an Option or relates to an Option; (b) the grant
date, which may not be any day prior to the date that the
Administrator approves the grant; (c) the number of Shares to which
the SAR relates; (d) the grant price, provided that the grant price shall not
be less than the Fair Market Value of the Shares subject to the SAR
as determined on the date of grant (unless such SAR complies with
Code Section 409A); (e) the terms and conditions of exercise or
maturity, including vesting; (f) the term, provided that an SAR must terminate no
later than ten (10) years after the date of grant; and (g) whether
the SAR will be settled in cash, Shares or a combination thereof.
If an SAR is granted in relation to an Option, then unless
otherwise determined by the Administrator, the SAR shall be
exercisable or shall mature at the same time or times, on the same
conditions and to the extent and in the proportion, that the
related Option is exercisable and may be exercised or mature for
all or part of the Shares subject to the related Option. Upon
exercise of any number of SARs, the number of Shares subject to the
related Option shall be reduced accordingly and such Option may not
be exercised with respect to that number of Shares. The exercise of
any number of Options that relate to an SAR shall likewise result
in an equivalent reduction in the number of Shares covered by the
related SAR.
8. Performance and Share Awards. Subject to
the terms of this Plan, the Administrator will determine all terms
and conditions of each award of Shares, Restricted Shares,
Restricted Share Units, Performance Shares or Performance Units,
including but not limited to: (a) the number of Shares and/or units
to which such Award relates; (b) whether, as a condition for the
Participant to realize all or a portion of the benefit provided
under the Award, one or more Performance Goals must be achieved
during such period as the Administrator specifies; (c) whether
the restrictions imposed on Restricted Share or Restricted Share
Units shall lapse, and all or a portion of the Performance Goals
subject to an Award shall be deemed achieved, upon a
Participant’s death, Disability or Retirement; (d) the length
of the vesting and/or performance period and, if different, the
date on which payment of the benefit provided under the Award will
be made; (e) with respect to Performance Units, whether to measure
the value of each unit in relation to a designated dollar value or
the Fair Market Value of one or more Shares; and (f) with respect
to Restricted Share Units and Performance Units, whether to settle
such Awards in cash, in Shares (including Restricted Shares), or a
combination thereof.
9. Annual Incentive Awards. Subject to the
terms of this Plan, the Administrator will determine all terms and
conditions of an Annual Incentive Award, including but not limited
to the Performance Goals, performance period, the potential amount
payable, and the timing of payment;provided that the Administrator must
require that payment of all or any portion of the amount subject to
the Annual Incentive Award is contingent on the achievement of one
or more Performance Goals during the period the Administrator
specifies, although the Administrator may specify that all or a
portion of the Performance Goals subject to an Award are deemed
achieved upon a Participant’s death, Disability or
Retirement, or such other circumstances as the Administrator may
specify.
10. Long-Term Incentive Awards. Subject to
the terms of this Plan, the Administrator will determine all terms
and conditions of a Long-Term Incentive Award, including but not
limited to the Performance Goals, performance period (which must be
more than one year), the potential amount payable, and the timing
of payment;provided that
the Administrator must require that payment of all or any portion
of the amount subject to the Long-Term Incentive Award is
contingent on the achievement of one or more Performance Goals
during the period the Administrator specifies, although the
Administrator may specify that all or a portion of the Performance
Goals subject to an Award are deemed achieved upon a
Participant’s death, Disability or Retirement, or such other
circumstances as the Administrator may specify.
11. Dividend Equivalent Units. Subject to
the terms of this Plan, the Administrator will determine all terms
and conditions of each award of Dividend Equivalent Units,
including but not limited to whether: (a) such Award will be
granted in tandem with another Award; (b) payment of the Award will
be made concurrently with dividend payments or credited to an
account for the Participant which provides for the deferral of such
amounts until a stated time; (c) the Award will be settled in cash
or Shares;and (d) as a condition for the Participant to realize all
or a portion of the benefit provided under the Award, one or more
Performance Goals must be achieved during such period as the
Administrator specifies;provided that Dividend Equivalent Units
may not be granted in connection with an Option, Share Appreciation
Right or other “stock right” within the meaning of Code
Section 409A; and provided
further that no Dividend
Equivalent Unit granted in tandem with another Award shall include
vesting provisions more favorable to the Participant than the
vesting provisions, if any, to which the tandem Award is
subject.
12. Other Share-Based Awards. Subject to the
terms of this Plan, the Administrator may grant to Participants
other types of Awards, which may be denominated or payable in,
valued in whole or in part by reference to, or otherwise based on,
Shares, either alone or in addition to or in conjunction with other
Awards, and payable in Shares or cash. Without limitation except as
provided herein (and subject to the limitations of Section 15(e)),
such Award may include the issuance of shares of unrestricted
Shares, which may be awarded in payment of director fees, in lieu
of cash compensation, in exchange for cancellation of a
compensation right, as a bonus, or upon the attainment of
Performance Goals or otherwise, or rights to acquire Shares from
the Company. The Administrator shall determine all terms and
conditions of the Award, including but not limited to, the time or
times at which such Awards shall be made, and the number of Shares
to be granted pursuant to such Awards or to which such Award shall
relate;provided that any
Award that provides for purchase rights shall be priced at 100% of
Fair Market Value on the date of the Award.
13. Effect of Termination on
Awards. If the
Participant has in effect an employment, retention, change of
control, severance or similar agreement with the Company or any
Affiliate that discusses the effect of the Participant’s
termination of employment or service on the Participant’s
Awards, then such agreement shall control. In any other case,
except as otherwise provided by the Administrator in an Award
agreement (which shall control in the event it is inconsistent with
the following provisions) or as otherwise determined by the
Administrator prior to or at the time of termination of a
Participant’s employment or service, the following provisions
shall apply upon a Participant’s termination of employment or
service with the Company and its Affiliates:
(a) Termination
of Employment or Service. If a Participant’s service
with the Company and its Affiliates as an employee or a Director
ends for any reason other than (i) a termination for Cause, (ii)
death, (iii) Disability or (iv) Retirement, then:
(i) Any outstanding
unvested Options or SARs shall be forfeited immediately upon such
termination, and any outstanding vested Options or SARs shall be
exercisable until the earlier of (A) six (6) months following the
Participant’s termination date and (B) the expiration date of
the Option or SAR under the terms of the applicable Award
agreement;provided that, if
the Option was granted to a Director, then the vested Options or
SARs shall be exercisable until the earlier of twelve (12) months
following the Participant’s termination date and the
expiration date.
(ii) All
other outstanding Awards made to the Participant, to the extent not
then earned, vested or paid to the Participant, shall terminate on
the Participant’s last day of employment or
service.
(b) Death, Disability or Retirement of
Participant. If a Participant dies during employment with
the Company and its Affiliates or while a Director, or if a
Participant’s service terminates as a result of Disability or
Retirement, then:
(i) All outstanding
Options or SARs shall become fully vested and exercisable by the
Participant or, in the case of death, by the Participant’s
estate or the person who has acquired the right to exercise such
Awards by bequest or inheritance, as follows:
(A) In the case of the
Participant’s death, until the earlier of twelve (12) months
following the date of the Participant’s death and the
expiration date of the Option or SAR.
(B) In the case of a
termination as a result of Disability, until the earlier of twelve
(12) months following the date of the termination and the
expiration date of the Option or SAR.
(C) In the case of a
termination as a result of Retirement, until the earlier of ten
(10) years following the date of the Participant’s Retirement
and the expiration date of the Option or SAR.
(ii) All
restrictions on all outstanding Awards of Restricted Stock or
Restricted Units that are not Performance Awards, including all
related Dividend Equivalent Units, shall be deemed to have lapsed,
and such Awards shall become fully vested, upon the date of death
or termination, as applicable.
(iii) All
outstanding Awards of Performance Shares and Performance Units,
including all related Dividend Equivalent Units, shall be paid in
either unrestricted shares of Stock or cash, as the case may be,
following the end of the performance period and based on
achievement of the Performance Goals established for such Awards,
as if the Participant had not died or terminated service, as
applicable, but prorated based on the portion of the performance
period that the Participant has completed at the time of death or
termination of service.
(iv) All
other outstanding Awards made to the Participant, to the extent not
then earned, vested or paid to the Participant, shall terminate on
the Participant’s last day of employment or
service.
(c) Termination for Cause. If a
Participant’s employment with the Company and its Affiliates
or service as a Director is terminated for Cause, all Awards and
grants of every type, whether or not then vested, shall terminate
no later than the Participant’s last day of employment. The
Committee shall have discretion to waive the application of this
Section 13(c) in whole or in part and to determine whether the
event or conduct at issue constitutes Cause for
termination.
(d) Time of Termination. For purposes of
this Section 13, termination of service shall be deemed to occur at
11:59 p.m. (Eastern Time) on the relevant date described above,
except that, if the Participant is terminated for Cause, then the
termination shall occur immediately at the time of such
termination.
(e) Consultants
and Other Stock-Based Awards. The Administrator shall have
the discretion to determine, at the time an Award is made, the
effect of the termination of service of a Consultant on Awards held
by such individual, and the effect on other Stock-based Awards of
the Participant’s termination of employment or service with
the Company and its Affiliates.
14. Restrictions
on Transfer, Encumbrance and Disposition. No Award granted under this Plan may
be sold, assigned, mortgaged, pledged, exchanged, hypothecated or
otherwise transferred, or encumbered or disposed of, by a
Participant other than by will or the laws of descent and
distribution, and during the lifetime of the Participant such
Awards may be exercised only by the Participant or the
Participant’s legal representative or by the permitted
transferee of such Participant as hereinafter provided (or by the
legal representative of such permitted transferee). Notwithstanding
the foregoing, a Participant may transfer an Award if permitted by
the Administrator. Subsequent transfers of transferred Awards are
prohibited except transfers otherwise made in accordance with this
Section 13. Any attempted transfer not permitted by this
Section 13 shall be null and void and have no legal effect.
The restrictions set forth in this Section 13, and any risk of
forfeiture applicable to an Award, shall be enforceable against any
transferee of an Award.
15. Termination and Amendment of
Plan; Amendment, Modification or Cancellation of
Awards.
(a) Term
of Plan. Unless the Board earlier terminates this Plan
pursuant to Section 15(b), this Plan will terminate on the tenth
(10th)
anniversary of the Effective Date.
(b) Termination and Amendment. The Board or
the Administrator may amend, alter, suspend, discontinue or
terminate this Plan at any time, subject to the following
limitations:
(i) the Board must
approve any amendment of this Plan to the extent the Company
determines such approval is required by: (A) prior action of
the Board, (B) applicable corporate law, or (C) any other
applicable law;
(ii) shareholders must approve any
amendment of this Plan to the extent the Company determines such
approval is required by: (A) Section 16 of the Exchange
Act, (B) the Code, (C) the listing requirements of any
principal securities exchange or market on which the Shares are
then traded, or (D) any other applicable law; and
(iii) shareholders
must approve any of the following Plan amendments: (A) an
amendment to materially increase any number of Shares specified in
Section 5(a)(except as permitted by Section 17), or
(B) an amendment that would diminish the protections afforded
by Section 15(e).
(c) Amendment, Modification, Cancellation and
Disgorgement of Awards.
(i) Except as provided
in Section 15(e) and subject to the requirements of this Plan,
the Administrator may modify, amend or cancel any Award, or waive
any restrictions or conditions applicable to any Award or the
exercise of the Award;provided that, except as otherwise
provided in the Plan or the Award agreement, any modification or
amendment that materially diminishes the rights of the Participant,
or the cancellation of the Award, shall be effective only if agreed
to by the Participant or any other person(s) as may then have an
interest in the Award, but the Administrator need not obtain
Participant (or other interested party) consent for the
modification, amendment or cancellation of an Award pursuant to the
provisions of subsection (ii) or Section 17 or as follows: (A)
to the extent the Administrator deems such action necessary to
comply with any applicable law or the listing requirements of any
principal securities exchange or market on which the Shares are
then traded; (B) to the extent the Administrator deems necessary to
preserve favorable accounting or tax treatment of any Award for the
Company; or (C) to the extent the Administrator determines that
such action does not materially and adversely affect the value of
an Award or that such action is in the best interest of the
affected Participant (or any other person(s) as may then have an
interest in the Award). Notwithstanding the foregoing, unless
determined otherwise by the Administrator, any such amendment shall
be made in a manner that will enable an Award intended to be exempt
from Code Section 409A to continue to be so exempt, or to enable an
Award intended to comply with Code Section 409A to continue to so
comply.
(ii) Notwithstanding
anything to the contrary in an Award agreement, the Administrator
shall have full power and authority to terminate or cause the
Participant to forfeit the Award, and require the Participant to
disgorge to the Company any gains attributable to the Award, if the
Participant engages in any action constituting, as determined by
the Administrator in its discretion, Cause for termination, or a
breach of any Award agreement or any other agreement between the
Participant and the Company or an Affiliate concerning
noncompetition, nonsolicitation, confidentiality, trade secrets,
intellectual property, nondisparagement or similar
obligations.
(iii) Any
Awards granted pursuant to this Plan, and any Shares issued or cash
paid pursuant to an Award, shall be subject to any recoupment or
clawback policy that is adopted by, or any recoupment or similar
requirement otherwise made applicable by law, regulation or listing
standards to, the Company from time to time.
(d) Survival of Authority and Awards.
Notwithstanding the foregoing, the authority of the Board and the
Administrator under this Section 15 and to otherwise administer the
Plan with respect to then-outstanding Awards will extend beyond the
date of this Plan’s termination. In addition, termination of
this Plan will not affect the rights of Participants with respect
to Awards previously granted to them, and all unexpired Awards will
continue in force and effect after termination of this Plan except
as they may lapse or be terminated by their own terms and
conditions.
(e) Repricing and Backdating Prohibited.
Notwithstanding anything in this Plan to the contrary, and except
for the adjustments provided for in Section 17, neither the
Administrator nor any other person may (i) amend the terms of
outstanding Options or SARs to reduce the exercise or grant price
of such outstanding Options or SARs; (ii) cancel outstanding
Options or SARs in exchange for Options or SARs with an exercise or
grant price that is less than the exercise or grant price of the
original Options or SARs; or (iii) cancel outstanding Options or
SARs with an exercise or grant price above the current Fair Market
Value of a Share in exchange for cash or other securities. In
addition, the Administrator may not make a grant of an Option or
SAR with a grant date that is effective prior to the date the
Administrator takes action to approve such Award.
(f) Foreign Participation. To assure the
viability of Awards granted to Participants employed or residing in
foreign countries, the Administrator may provide for such special
terms as it may consider necessary or appropriate to accommodate
differences in local law, tax policy, accounting or custom.
Moreover, the Administrator may approve such supplements to, or
amendments, restatements or alternative versions of, this Plan as
it determines is necessary or appropriate for such purposes. Any
such amendment, restatement or alternative versions that the
Administrator approves for purposes of using this Plan in a foreign
country will not affect the terms of this Plan for any other
country. In addition, all such supplements, amendments,
restatements or alternative versions must comply with the
provisions of Section 15(b)(ii).
(g) Code Section 409A. The provisions of
Code Section 409A are incorporated herein by reference to the
extent necessary for any Award that is subject to Code Section 409A
to comply therewith.
16. Taxes.
(a) Withholding.
In the event the Company or one of its Affiliates is required to
withhold any Federal, state or local taxes or other amounts in
respect of any income recognized by a Participant as a result of
the grant, vesting, payment or settlement of an Award or
disposition of any Shares acquired under an Award, the Company or
its Affiliate may deduct (or require an Affiliate to deduct) from
any cash payments of any kind otherwise due the Participant, or
with the consent of the Administrator, Shares otherwise deliverable
or vesting under an Award, to satisfy such tax or other
obligations. Alternatively, the Company or its Affiliate may
require such Participant to pay to the Company or its Affiliate, in
cash, promptly on demand, or make other arrangements satisfactory
to the Company or its Affiliate regarding the payment to the
Company or its Affiliate of the aggregate amount of any such taxes
and other amounts. If Shares are deliverable upon exercise or
payment of an Award, then, unless restricted by the Administrator
and subject to such procedures as the Administrator may specify, a
Participant may satisfy all or a portion of the Federal, state and
local withholding tax obligations arising in connection with such
Award by electing to (i) have the Company or its Affiliate
withhold Shares otherwise issuable under the Award,
(ii) tender back Shares received in connection with such Award
or (iii) deliver other previously owned Shares; provided that the amount to be withheld
may not exceed the total maximum statutory tax rates associated
with the transaction to the extent needed for the Company and its
Affiliates to avoid an accounting charge. If an election is
provided, the election must be made on or before the date as of
which the amount of tax to be withheld is determined and otherwise
as the Administrator requires. In any case, the Company and its
Affiliates may defer making payment or delivery under any Award if
any such tax may be pending unless and until indemnified to its
satisfaction.
(b) No Guarantee of Tax Treatment.
Notwithstanding any provisions of the Plan, the Company does not
guarantee to any Participant or any other Person with an interest
in an Award that (i) any Award intended to be exempt from Code
Section 409A shall be so exempt, (ii) any Award intended to comply
with Code Section 409A or Code Section 422 shall so comply, or
(iii) any Award shall otherwise receive a specific tax treatment
under any other applicable tax law, nor in any such case will the
Company or any Affiliate be required to indemnify, defend or hold
harmless any individual with respect to the tax consequences of any
Award.
17. Adjustment Provisions; Change
of Control.
(a) Adjustment
of Shares. If: (i) the Company shall at any time be involved
in a merger or other transaction in which the Shares are changed or
exchanged; (ii) the Company shall subdivide or combine the Shares
or the Company shall declare a dividend payable in Shares, other
securities (other than share purchase rights issued pursuant to a
shareholder rights agreement) or other property; (iii) the Company
shall effect a cash dividend the amount of which, on a per Share
basis, exceeds ten percent (10%) of the Fair Market Value of a
Share at the time the dividend is declared, or the Company shall
effect any other dividend or other distribution on the Shares in
the form of cash, or a repurchase of Shares, that the Board
determines by resolution is special or extraordinary in nature or
that is in connection with a transaction that the Company
characterizes publicly as a recapitalization or reorganization
involving the Shares; or (iv) any other event shall occur, which,
in the case of this clause (iv), in the judgment of the
Administrator necessitates an adjustment to prevent dilution or
enlargement of the benefits or potential benefits intended to be
made available under this Plan, then the Administrator shall, in
such manner as it may deem equitable to prevent dilution or
enlargement of the benefits or potential benefits intended to be
made available under this Plan, adjust as applicable: (A) the
number and type of Shares subject to this Plan (including the
number and type of Shares described in Section 5(a)) and which may
after the event be made the subject of Awards; (B) the number
and type of Shares subject to outstanding Awards; (C) the
grant, purchase, or exercise price with respect to any Award; and
(D) the Performance Goals of an Award. In any such case, the
Administrator may also (or in lieu of the foregoing) make provision
for a cash payment to the holder of an outstanding Award in
exchange for the cancellation of all or a portion of the Award
(without the consent of the holder of an Award) in an amount
determined by the Administrator effective at such time as the
Administrator specifies (which may be the time such transaction or
event is effective). However, in each case, with respect to Awards
of incentive share options, no such adjustment may be authorized to
the extent that such authority would cause this Plan to violate
Code Section 422(b). Further, the number of Shares subject to
any Award payable or denominated in Shares must always be a whole
number. In any event, previously granted Options or SARs are
subject to only such adjustments as are necessary to maintain the
relative proportionate interest the Options and SARs represented
immediately prior to any such event and to preserve, without
exceeding, the value of such Options or SARs.
Without
limitation, in the event of any reorganization, merger,
consolidation, combination or other similar corporate transaction
or event, whether or not constituting a Change of Control (other
than any such transaction in which the Company is the continuing
corporation and in which the outstanding Shares are not being
converted into or exchanged for different securities, cash or other
property, or any combination thereof), the Administrator may
substitute, on an equitable basis as the Administrator determines,
for each Share then subject to an Award and the Shares subject to
this Plan (if the Plan will continue in effect), the number and
kind of shares, other securities, cash or other property to which
holders of Shares are or will be entitled in respect of each Share
pursuant to the transaction.
Notwithstanding the
foregoing, in the case of a share dividend (other than a share
dividend declared in lieu of an ordinary cash dividend) or
subdivision or combination of the Shares (including a reverse share
split), if no action is taken by the Administrator, adjustments
contemplated by this subsection that are proportionate shall
nevertheless automatically be made as of the date of such share
dividend or subdivision or combination of the Shares.
For the
avoidance of doubt, the grant of an Award shall not affect in any
way the right or power of the Company or any of its Affiliates to
make or authorize any or all adjustments, recapitalizations,
reorganizations or other changes in the Company’s or such
Affiliate’s capital structure or business, or any merger,
consolidation or business combination of the Company or such
Affiliate, or any issuance or modification of any term, condition,
or covenant of any bond, debenture, debt, preferred stock or other
instrument ahead of or affecting the Stock or the rights of the
holders of Stock, or the dissolution or liquidation of the Company
or any Affiliate, or any sale or transfer of all or any part of its
assets or business or any other Company or Affiliate action or
proceeding, whether of a similar character or
otherwise.
(b) Issuance or Assumption. Notwithstanding
any other provision of this Plan, and without affecting the number
of Shares otherwise reserved or available under this Plan, in
connection with any merger, consolidation, acquisition of property
or stock, or reorganization, the Administrator may authorize the
issuance or assumption of awards under this Plan upon such terms
and conditions as it may deem appropriate.
(c) Change of Control. Unless otherwise
expressly provided in an Award agreement or another contract,
including an employment agreement, or under the terms of a
transaction constituting a Change of Control, the Administrator may
provide for the acceleration of the vesting or earning and, if
applicable, exercisability of any outstanding Award, or portion
thereof, or the lapsing of any conditions or restrictions on or the
time for payment in respect of any outstanding Award, or portion
thereof, upon a Change of Control or the termination of the
Participant’s employment following a Change of Control. In
addition, unless otherwise expressly provided in an Award agreement
or another contract, including an employment agreement, or under
the terms of a transaction constituting a Change of Control,
without limitation of the foregoing, the Administrator may provide
that any or all of the following shall occur in connection with a
Change of Control: (a) the substitution for the Shares subject to
any outstanding Award, or portion thereof, of shares or other
securities of the surviving corporation or any successor
corporation to the Company, or a parent or subsidiary thereof, in
which event the aggregate purchase or exercise price, if any, of
such Award, or portion thereof, shall remain the same, (b) the
conversion of any outstanding Award, or portion thereof, into a
right to receive cash or other property upon or following the
consummation of the Change of Control in an amount equal to the
value of the consideration to be received by holders of Shares in
connection with such transaction for one Share, less the per share
purchase or exercise price of such Award, if any, multiplied by the
number of Shares subject to such Award, or a portion thereof, (c)
acceleration of the vesting (and, as applicable, the
exercisability) of any and/or all outstanding Awards, (d) the
cancellation of any outstanding and unexercised Awards upon or
following the consummation of the Change of Control (without the
consent of an Award holder or any person with an interest in an
Award), (e) in the case of Options or SARs, the cancellation of all
outstanding Options or SARs in exchange for a cash payment equal to
the excess of the Change of Control Price over the exercise price
of the Shares subject to such Option or SAR upon the Change of
Control (or for no cash payment if such excess is zero), and/or (f)
the cancellation of any Awards in exchange for a cash payment based
on the value of the Award as of the date of the Change of Control
(or for no payment if the Award has no value).
For
purposes of this Section 17, the “value” of a
Performance Share shall be equal to, and the “value” of
a Performance Unit for which the value is equal to the Fair Market
Value of Shares shall be based on, the Change of Control Price.
Notwithstanding anything to the contrary in this
Section 17(c), the terms of any Awards that are subject to
Code Section 409A shall govern the treatment of such Awards upon a
Change of Control, and the terms of this Section 17(c) shall
not apply, to the extent required for such Awards to remain
compliant with Code Section 409A, as applicable.
(d) Application of Limits on
Payments.
(i) Determination of Cap or Payment. Except
to the extent the Participant has in effect an employment or
similar agreement with the Company or any Affiliate or is subject
to a policy that provides for a more favorable result to the
Participant upon a Change of Control, if any payments or benefits
paid by the Company pursuant to this Plan, including any
accelerated vesting or similar provisions (“Plan
Payments”), would cause some or all of the Plan Payments in
conjunction with any other payments made to or benefits received by
a Participant in connection with a Change of Control (such payments
or benefits, together with the Plan Payments, the “Total
Payments”) to be subject to the tax (“Excise
Tax”) imposed by Code Section 4999 but for this Section 17(d)
then, notwithstanding any other provision of this Plan to the
contrary, the Total Payments shall be delivered either (A) in full
or (B) in an amount such that the value of the aggregate Total
Payments that the Participant is entitled to receive shall be One
Dollar ($1.00) less than the maximum amount that the Participant
may receive without being subject to the Excise Tax, whichever of
(A) or (B) results in the receipt by the Participant of the
greatest benefit on an after-tax basis (taking into account
applicable federal, state and local income taxes and the Excise
Tax).
(A) If a Participant or
the Company believes that a payment or benefit due the Participant
will result in some or all of the Total Payments being subject to
the Excise Tax, then the Company, at its expense, shall obtain the
opinion (which need not be unqualified) of nationally recognized
tax counsel (“National Tax Counsel”) selected by the
Company (which may be regular outside counsel to the Company),
which opinion sets forth (1) the amount of the Base Period Income
(as defined below), (2) the amount and present value of the Total
Payments, (3) the amount and present value of any excess parachute
payments determined without regard to any reduction of Total
Payments pursuant to Section 6(a)(ii), and (4) the net after-tax
proceeds to the Participant, taking into account applicable
federal, state and local income taxes and the Excise Tax if (x) the
Total Payments were delivered in accordance with Section
17(d)(i)(A) or (y) the Total Payments were delivered in accordance
with Section 17(d)(i)(B). The opinion of National Tax Counsel shall
be addressed to the Company and the Participant and shall be
binding upon the Company and the Participant. If such National Tax
Counsel opinion determines that Section 17(d)(i)(B) applies, then
the Plan Payments or any other payment or benefit determined by
such counsel to be includable in the Total Payments shall be
reduced or eliminated so that under the bases of calculations set
forth in such opinion there will be no excess parachute payment. In
such event, payments or benefits included in the Total Payments
shall be reduced or eliminated by applying the following
principles, in order: (1) the payment or benefit with the higher
ratio of the parachute payment value to present economic value
(determined using reasonable actuarial assumptions) shall be
reduced or eliminated before a payment or benefit with a lower
ratio; (2) the payment or benefit with the later possible payment
date shall be reduced or eliminated before a payment or benefit
with an earlier payment date; and (3) cash payments shall be
reduced prior to non-cash benefits;provided that if the foregoing order of
reduction or elimination would violate Code Section 409A, then the
reduction shall be made pro rata among the payments or benefits
included in the Total Payments (on the basis of the relative
present value of the parachute payments).
(B) For purposes of
this Section 17: (1) the terms “excess parachute
payment” and “parachute payments” shall have the
meanings given in Code Section 280G and such “parachute
payments” shall be valued as provided therein; (2) present
value shall be calculated in accordance with Code Section
280G(d)(4); (3) the term “Base Period Income” means an
amount equal to the Participant’s “annualized
includible compensation for the base period” as defined in
Code Section 280G(d)(1); (4) for purposes of the opinion of
National Tax Counsel, the value of any noncash benefits or any
deferred payment or benefit shall be determined by the
Company’s independent auditors in accordance with the
principles of Code Sections 280G(d)(3) and (4); and (5) the
Participant shall be deemed to pay federal income tax and
employment taxes at the highest marginal rate of federal income and
employment taxation, and state and local income taxes at the
highest marginal rate of taxation in the state or locality of the
Participant’s domicile, net of the maximum reduction in
federal income taxes that may be obtained from the deduction of
such state and local taxes.
(C) If National Tax
Counsel so requests in connection with the opinion required by this
Section 17(d)(ii) the Company shall obtain, at the Company’s
expense, and the National Tax Counsel may rely on, the advice of a
firm of recognized executive compensation consultants as to the
reasonableness of any item of compensation to be received by the
Participant solely with respect to its status under Code Section
280G.
(D) The Company agrees
to bear all costs associated with, and to indemnify and hold
harmless the National Tax Counsel from, any and all claims, damages
and expenses resulting from or relating to its determinations
pursuant to this Section 17, except for claims, damages or expenses
resulting from the gross negligence or willful misconduct of such
firm.
(E) This Section 17
shall be amended to comply with any amendment or successor
provision to Code Section 280G or Code Section 4999. If such
provisions are repealed without successor, then this Section 17
shall be cancelled without further effect.
18. Miscellaneous.
(a) Other
Terms and Conditions. The Administrator may provide in any
Award agreement such other provisions (whether or not applicable to
the Award granted to any other Participant) as the Administrator
determines appropriate to the extent not otherwise prohibited by
the terms of the Plan.
(b) Employment and Service. The issuance of
an Award shall not confer upon a Participant any right with respect
to continued employment or service with the Company or any
Affiliate, or the right to continue as a Director. Unless
determined otherwise by the Administrator, for purposes of the Plan
and all Awards, the following rules shall apply:
(i) a Participant who
transfers employment between the Company and its Affiliates, or
between Affiliates, will not be considered to have terminated
employment;
(ii) a
Participant who ceases to be a Non-Employee Director because he or
she becomes an employee of the Company or an Affiliate shall not be
considered to have ceased service as a Director with respect to any
Award until such Participant’s termination of employment with
the Company and its Affiliates;
(iii) a
Participant who ceases to be employed by the Company or an
Affiliate and immediately thereafter becomes a Non-Employee
Director, a non-employee director of an Affiliate, or a consultant
to the Company or any Affiliate shall not be considered to have
terminated employment until such Participant’s service as a
director of, or consultant to, the Company and its Affiliates has
ceased; and
(iv) a
Participant employed by an Affiliate will be considered to have
terminated employment when such entity ceases to be an
Affiliate.
Notwithstanding the
foregoing, for purposes of an Award that is subject to Code Section
409A, if a Participant’s termination of employment or service
triggers the payment of compensation under such Award, then the
Participant will be deemed to have terminated employment or service
upon his or her “separation from service” within the
meaning of Code Section 409A. Notwithstanding any other provision
in this Plan or an Award to the contrary, if any Participant is a
“specified employee” within the meaning of Code Section
409A as of the date of his or her “separation from
service” within the meaning of Code Section 409A, then, to
the extent required by Code Section 409A, any payment made to the
Participant on account of such separation from service shall not be
made before a date that is six months after the date of the
separation from service.
(c) No Fractional Shares. No fractional
Shares or other securities may be issued or delivered pursuant to
this Plan, and the Administrator may determine whether cash, other
securities or other property will be paid or transferred in lieu of
any fractional Shares or other securities, or whether such
fractional Shares or other securities or any rights to fractional
Shares or other securities will be canceled, terminated or
otherwise eliminated.
(d) Unfunded Plan; Awards Not Includable for
Benefits Purposes. This Plan is unfunded and does not
create, and should not be construed to create, a trust or separate
fund with respect to this Plan’s benefits. This Plan does not
establish any fiduciary relationship between the Company and any
Participant or other person. To the extent any person holds any
rights by virtue of an Award granted under this Plan, such rights
are no greater than the rights of the Company’s general
unsecured creditors. Income recognized by a Participant pursuant to
an Award shall not be included in the determination of benefits
under any employee pension benefit plan (as such term is defined in
Section 3(2) of the Employee Retirement Income Security Act of
1974, as amended) or group insurance or other benefit plans
applicable to the Participant which are maintained by the Company
or any Affiliate, except as may be provided under the terms of such
plans or determined by resolution of the Board.
(e) Requirements of Law and Securities
Exchange. The granting of Awards and the issuance of Shares
in connection with an Award are subject to all applicable laws,
rules and regulations and to such approvals by any governmental
agencies or national securities exchanges as may be required.
Notwithstanding any other provision of this Plan or any award
agreement, the Company has no liability to deliver any Shares under
this Plan or make any payment unless such delivery or payment would
comply with all applicable laws and the applicable requirements of
any securities exchange or similar entity, and unless and until the
Participant has taken all actions required by the Company in
connection therewith. The Company may impose such restrictions on
any Shares issued under the Plan as the Company determines
necessary or desirable to comply with all applicable laws, rules
and regulations or the requirements of any national securities
exchanges.
(f) Governing Law; Venue. This Plan, and
all agreements under this Plan, will be construed in accordance
with and governed by the laws of the Cayman Islands, without
reference to any conflict of law principles. Any legal action or
proceeding with respect to this Plan, any Award or any award
agreement, or for recognition and enforcement of any judgment in
respect of this Plan, any Award or any award agreement, may only be
brought and determined in (i) a court sitting in the Cayman
Islands, and (ii) a “bench” trial, and any party to
such action or proceeding shall agree to waive its right to a jury
trial.
(g) Limitations on Actions. Any legal
action or proceeding with respect to this Plan, any Award or any
award agreement, must be brought within one year (365 days) after
the day the complaining party first knew or should have known of
the events giving rise to the complaint.
(h) Construction. Whenever any words are
used herein in the masculine, they shall be construed as though
they were used in the feminine in all cases where they would so
apply; and wherever any words are used in the singular or plural,
they shall be construed as though they were used in the plural or
singular, as the case may be, in all cases where they would so
apply. Titles of sections are for general information only, and
this Plan is not to be construed with reference to such
titles.
(i) Severability. If any provision of this
Plan or any award agreement or any Award (a) is or becomes or
is deemed to be invalid, illegal or unenforceable in any
jurisdiction, or as to any person or Award, or (b) would
disqualify this Plan, any award agreement or any Award under any
law the Administrator deems applicable, then such provision should
be construed or deemed amended to conform to applicable laws, or if
it cannot be so construed or deemed amended without, in the
determination of the Administrator, materially altering the intent
of this Plan, award agreement or Award, then such provision should
be stricken as to such jurisdiction, person or Award, and the
remainder of this Plan, such award agreement and such Award will
remain in full force and effect.
19. Definitions. Capitalized terms used in
this Plan or any Award agreement have the following meanings,
unless the Award agreement otherwise provides:
(a) “Administrator”
means the Committee; provided that, to the extent the Board
has retained authority and responsibility as an Administrator of
the Plan, the term “Administrator” shall also mean the
Board or, to the extent the Committee has delegated authority and
responsibility as an Administrator of the Plan to one or more
officers of the Company as permitted by Section 2(b), the term
“Administrator” shall also mean such officer or
officers.
(b) “Affiliate”
shall have the meaning given in Rule 12b-2 under the Exchange Act.
Notwithstanding the foregoing, for purposes of determining those
individuals to whom an Option or Share Appreciation Right may be
granted, the term “Affiliate” means any entity that,
directly or through one or more intermediaries, is controlled by,
controls, or is under common control with, the Company within the
meaning of Code Sections 414(b) or (c);provided that, in applying such
provisions, the phrase “at least 20 percent” shall be
used in place of “at least 80 percent” each place it
appears therein.
(c) “Award”
means a grant of Options, Share Appreciation Rights, Performance
Shares, Performance Units, Restricted Shares, Restricted Share
Units, Shares, an Annual Incentive Award, a Long-Term Incentive
Award, Dividend Equivalent Units or any other type of award
permitted under the Plan.
(d) “Board”
means the Board of Directors of the Company.
(e) “Cause”
means any of the following as determined by the Company: (i) with
respect to Participants other than Non-Employee Directors, the
definition set forth in any employment or similar agreement between
the Company or its Affiliates and the Participant or, if no such
definition exists, (A) the failure of the Participant to perform or
observe any of the material terms or provisions of any written
employment agreement between the Participant and the Company or its
Affiliates or, if no written agreement exists, the gross
dereliction of the Participant’s duties (for reasons other
than the Participant’s Disability) with respect to the
Company or its Affiliates; (B) the failure of the Participant to
comply fully with the lawful directives of the Board or the board
of directors of an Affiliate of the Company, as applicable, or the
officers or supervisory employees to whom the Participant reports;
(C) the Participant’s dishonesty, misconduct,
misappropriation of funds, or disloyalty or disparagement of the
Company, any of its Affiliates or its management or employees; or
(D) other proper cause determined in good faith by the
Administrator; or (ii) with respect to Non-Employee Directors, (A)
fraud or intentional misrepresentation; (B) embezzlement,
misappropriation or conversion of assets or opportunities of the
Company or any of its Affiliates; or (C) any other gross or willful
misconduct as determined by the Committee, in its sole and
conclusive discretion.
(f) “Change of
Control” means the first to occur of the following with
respect to the Company or any upstream holding company (which, for
purposes of this definition, shall be included in references to
“the Company”):
(i) Any
“Person,” as that term is defined in Sections 13(d) and
14(d) of the Exchange Act, but excluding the Company, any trustee
or other fiduciary holding securities under an employee benefit
plan of the Company, or any corporation owned, directly or
indirectly, by the shareholders of the Company in substantially the
same proportions as their ownership of shares of the Company, is or
becomes the “Beneficial Owner” (as that term is defined
in Rule 13d-3 under the Exchange Act), directly or indirectly, of
securities of the Company representing fifty percent (50%) or more
of the combined voting power of the Company’s then
outstanding securities; or
(ii) The
Company is merged or consolidated with any other corporation or
other entity, other than: (A) a merger or consolidation which would
result in the voting securities of the Company outstanding
immediately prior thereto continuing to represent (either by
remaining outstanding or by being converted into voting securities
of the surviving entity) more than fifty percent (50%) of the
combined voting power of the voting securities of the Company or
such surviving entity outstanding immediately after such merger or
consolidation; or (B) the Company engages in a merger or
consolidation effected to implement a recapitalization of the
Company (or similar transaction) in which no “Person”
(as defined above) acquires fifty percent (50%) or more of the
combined voting power of the Company’s then outstanding
securities. Notwithstanding the foregoing, a merger or
consolidation involving the Company shall not be considered a
“Change of Control” if the Company is the surviving
corporation and Shares are not converted into or exchanged for
shares or securities of any other corporation, cash or any other
thing of value, unless persons who beneficially owned Shares
outstanding immediately prior to such transaction own beneficially
less than a majority of the outstanding voting securities of the
Company immediately following the merger or
consolidation;
(iii) The
Company or any Affiliate sells, assigns or otherwise transfers
assets in a transaction or series of related transactions, if the
aggregate market value of the assets so sold, assigned or otherwise
transferred exceeds fifty percent (50%) of the Company’s
consolidated book value, determined by the Company in accordance
with generally accepted accounting principles, measured at the time
at which such transaction occurs or the first of such series of
related transactions occurs;provided that such a transfer effected
pursuant to a spin-off or split-up where shareholders of the
Company retain ownership of the transferred assets proportionate to
their pro rata ownership interest in the Company shall not be
deemed a “Change of Control”;
(iv) The
Company dissolves and liquidates substantially all of its assets;
or
(v) At any time after
the Effective Date when the “Continuing Directors”
cease to constitute a majority of the Board. For this purpose, a
“Continuing Director” shall mean: (A) the individuals
who, at the Effective Date, constitute the Board; and (B) any new
Directors (other than Directors designated by a person who has
entered into an agreement with the Company to effect a transaction
described in clause (i), (ii), or (iii) of this definition) whose
appointment to the Board or nomination for election by Company
shareholders was approved by a vote of at least two-thirds of the
then-serving Continuing Directors.
If an
Award is considered deferred compensation subject to the provisions
of Code Section 409A, then the Administrator may include an amended
definition of “Change of Control” in the Award
agreement issued with respect to such Award as necessary to comply
with, or as necessary to permit a deferral under, Code Section
409A.
(g) “Change of
Control Price” means the highest of the following: (i) the
Fair Market Value of the Shares, as determined on the date of the
Change of Control; (ii) the highest price per Share paid in the
Change of Control transaction; or (iii) the Fair Market Value of
the Shares, calculated on the date of surrender of the relevant
Award in accordance with Section 17(c), but this clause (iii) shall
not apply if in the Change of Control transaction, or pursuant to
an agreement to which the Company is a party governing the Change
of Control transaction, all of the Shares are purchased for and/or
converted into the right to receive a current payment of cash and
no other securities or other property.
(h) “Code”
means the Internal Revenue Code of 1986, as amended. Any reference
to a specific provision of the Code includes any successor
provision and the regulations promulgated under such
provision.
(i) “Committee”
means the Compensation Committee of the Board, or such other
committee of the Board that is designated by the Board with the
same or similar authority. The Committee shall consist only of
Non-Employee Directors (not fewer than two (2)) who also qualify as
non-employee directors within the meaning of Rule 16b-3(b)(3)
promulgated under the Exchange Act to the extent necessary for the
Plan to comply with Rule 16b-3 promulgated under the Exchange Act
or any successor rule.
(j) “Company”
means Oxbridge Re Holdings Limited, a Cayman Islands exempted
company, or any successor thereto.
(k) “Director”
means a member of the Board; “Non-Employee Director”
means a Director who is not also an employee of the Company or its
Subsidiaries.
(l) "Disability" means
disability as defined in the Company’s long-term disability
plan covering exempt salaried employees, except as otherwise
determined by the Administrator and set forth in an Award
agreement. The Administrator shall make the determination of
Disability and may request such evidence of disability as it
reasonably determines.
(m) “Dividend
Equivalent Unit” means the right to receive a payment, in
cash or Shares, equal to the cash dividends or other distributions
paid with respect to a Share as described in
Section 11.
(n) “Exchange
Act” means the Securities Exchange Act of 1934, as amended.
Any reference to a specific provision of the Exchange Act includes
any successor provision and the regulations and rules promulgated
under such provision.
(o) “Fair Market
Value” means, per Share on a particular date, the last sales
price on such date on the national securities exchange on which the
Shares are then traded, as reported in The Wall Street Journal, or
if no sales of Shares occur on the date in question, on the last
preceding date on which there was a sale on such exchange. If the
Shares are not listed on a national securities exchange, but are
traded in an over-the-counter market, the last sales price (or, if
there is no last sales price reported, the average of the closing
bid and asked prices) for the Shares on the particular date, or on
the last preceding date on which there was a sale of Shares on that
market, will be used. If the Shares are neither listed on a
national securities exchange nor traded in an over-the-counter
market, the price determined by the Administrator, in its
discretion, will be used. If an actual sale of a Share occurs on
the market, then the Company may consider the sale price to be the
Fair Market Value of such Share.
(p) “Incentive
Award” means the right to receive a cash payment to the
extent Performance Goals are achieved (or other requirements are
met), and shall include “Annual Incentive Awards” as
described in Section 9 and “Long-Term Incentive Awards”
as described in Section 10.
(q) “Option”
means the right to purchase Shares at a stated price for a
specified period of time.
(r) “Participant”
means an individual selected by the Administrator to receive an
Award.
(s) “Performance
Goals” means any subjective or objectives goals the
Administrator establishes, in its discretion with respect to an
Award. Performance Goals may, without limitation, relate to one or
more of the following with respect to the Company or any one or
more of its Subsidiaries, Affiliates or other business units: gross
premiums written; gross premiums earned; net premiums written; net
premiums earned; modeled probable maximum loss (“PML”);
PML to premium ratios; modeled average annual loss
(“AAL”); AAL to premium ratios; reinsurance costs; book value; revenue;
cash flow; total shareholder return; dividends; debt; net cash
provided by operating activities; net cash provided by operating
activities less net cash used in investing activities; ratio of
debt to debt plus equity; profit before tax; gross profit; net
profit; net operating profit; net operating profit after taxes; net
sales; earnings before interest and taxes;earnings before interest,
taxes, depreciation, and/or amortization (“EBITDA”);
Fair Market Value of Shares; basic earnings per share;EBITDA
excluding charges for share compensation, management fees,
restructurings, impairments and/or other specified items
(“Adjusted EBITDA”); EBITDA excluding capital
expenditures;basic or diluted earnings per share or improvement in
basic or diluted earnings per share; revenues (including, but not
limited to, total revenues, net revenues or revenue growth); net
operating profit; growth in basic or diluted book value; financial
return measures (including, but not limited to, return on assets,
capital, invested capital, investments, investment income generated
by underwriting or other operations or on the float from such
operations, equity, or revenue) including or excluding negative
returns, and with or without compounding; cash flow measures
(including, but not limited to, operating cash flow, free cash
flow, cash flow return on equity, and cash flow return on
investment); productivity ratios (including but not limited to
measuring liquidity, profitability or leverage); enterprise value;
share price (including, but not limited to, growth measures and
total shareholder return, inclusive or exclusive of dividends);
expense/cost management targets (including but not limited to
improvement in or attainment of expense levels, capital expenditure
levels, and/or working capital levels); margins (including, but not
limited to, operating margin, underwriting margins, net income
margin, cash margin, gross, net or operating profit margins, EBITDA
margins, Adjusted EBITDA margins); operating efficiency; market
share or market penetration; customer targets (including, but not
limited to, customer growth or customer satisfaction); working
capital targets or improvements; profit measures (including but not
limited to gross profit, net profit, operating profit, investment
profit and/or underwriting profit), including or excluding charges
for share compensation, fee income, underwriting losses incurred in
prior periods, changes in IBNR reserves and/or other specified
items; economic value added; balance sheet metrics (including, but
not limited to, inventory, inventory turns, receivables turnover,
net asset turnover, debt reduction, retained earnings, year-end
cash, cash conversion cycle, ratio of debt to equity or to EBITDA);
workforce targets (including but not limited to diversity goals,
employee engagement or satisfaction, employee retention, and
workplace health and safety goals); implementation, completion or
attainment of measurable objectives with respect to risk
management, research and development, key products or key projects,
lines of business, acquisitions and divestitures and strategic plan
development and/or implementation; comparisons with various stock
market indices, peer companies or industry groups or
classifications with regard to one more of these criteria; or a
combination of the foregoing. Except to the extent otherwise
determined by the Administrator, as to each Performance Goal, the
relevant measurement of performance shall be computed in accordance
with generally accepted accounting principles to the extent
applicable, but will exclude the effects of the following: (i)
charges for reorganizing and restructuring; (ii) discontinued
operations; (iii) asset write-downs; (iv) gains or losses on the
disposition of a business; (v) changes in tax or accounting
principles, regulations or laws; (vi) mergers, acquisitions,
dispositions or recapitalizations; (vii) impacts on interest
expense, preferred dividends and share dilution as a result of debt
and capital transactions; (viii) extraordinary, unusual and/or
non-recurring items of income, expense, gain or loss, that, in case
of each of the foregoing, the Company identifies in its publicly
filed periodic or current reports, its audited financial
statements, including notes to the financial statements, or the
Management’s Discussion and Analysis section of the
Company’s annual report; (ix) realized capital gains and
losses except for periodic settlements and accruals on non-hedge
derivative instruments;(x) valuation changes on imbedded
derivatives that are not hedged; (xi) after tax effect of
catastrophe losses; and (xii) any settlement, award or claim paid
as a result of lawsuits or other proceedings brought against the
Company or any one or more of its Subsidiaries or Affiliates
regarding the scope and nature of coverage provided under an
insurance policy issued by such company. The Administrator may also
provide for other adjustments to Performance Goals in the Award
agreement or plan document evidencing any Award. In addition, the
Administrator may appropriately adjust any evaluation of
performance under a Performance Goal to exclude any of the
following events that occurs during a performance period: (i)
litigation, claims, judgments or settlements; (ii) the effects of
changes in other laws or regulations affecting reported results;
and (iii) accruals of any amounts for payment under this Plan or
any other compensation arrangements maintained by the Company.
Where applicable, the Performance Goals may be expressed, without
limitation, in terms of attaining a specified level of the
particular criterion or the attainment of an increase or decrease
(expressed as absolute numbers, averages and/or percentages) in the
particular criterion or achievement in relation to a peer group or
other index. The Performance Goals may include a threshold level of
performance below which no payment will be made (or no vesting will
occur), levels of performance at which specified payments will be
paid (or specified vesting will occur), and a maximum level of
performance above which no additional payment will be made (or at
which full vesting will occur). In addition, the Administrator may
establish other Performance Goals and provide for other exclusions
or adjustments not listed in this Plan.
(t) “Performance
Shares” means the right to receive Shares to the extent
Performance Goals are achieved (or other requirements are met) as
described in Section 8.
(u) “Performance
Unit” means the right to receive a cash payment and/or Shares
valued in relation to a unit that has a designated dollar value or
the value of which is equal to the Fair Market Value of one or more
Shares, to the extent Performance Goals are achieved (or other
requirements are met) as described in Section 8.
(v) “Person”
has the meaning given in Section 3(a)(9) of the Exchange Act, as
modified and used in Sections 13(d) and 14(d) thereof, or any group
of Persons acting in concert that would be considered
“persons acting as a group” within the meaning of
Treas. Reg. § 1.409A-3(i)(5).
(w) “Plan”
means this Oxbridge Re Holdings Limited 2021 Omnibus Incentive
Plan, as may be amended from time to time.
(x) “Restricted
Share” means a Share that is subject to a risk of forfeiture
or restrictions on transfer, or both a risk of forfeiture and
restrictions on transfer, as described in
Section 8.
(y) “Restricted
Share Unit” means the right to receive a cash payment and/or
Shares equal to the Fair Market Value of one Share that is subject
to a risk of forfeiture or restrictions on transfer, or both a risk
of forfeiture and restrictions on transfer, as described in
Section 8.
(z) “Retirement”
means termination of employment or service with the Company and its
Affiliates on or after the date the Participant has both attained
age sixty (60) and completed ten (10) years of service with the
Company and its Affiliates.
(aa) “Section 16
Participants” means Participants who are subject to the
provisions of Section 16 of the Exchange Act.
(bb) “Share”
means an ordinary share of the Company, par value $0.001 per
share.
(cc) “Share
Appreciation Right” or “SAR” means the right to
receive cash, and/or Shares with a Fair Market Value, equal to the
appreciation of the Fair Market Value of a Share during a specified
period of time.
(dd) “Subsidiary”
means any corporation, limited liability company or other limited
liability entity in an unbroken chain of entities beginning with
the Company if each of the entities (other than the last entities
in the chain) owns the shares or equity interest possessing more
than fifty percent (50%) of the total combined voting power of all
classes of shares or other equity interests in one of the other
entities in the chain.
Oxbridge Re (NASDAQ:OXBR)
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Oxbridge Re (NASDAQ:OXBR)
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Von Jan 2024 bis Jan 2025
