OPTION AGREEMENT - JAMES N. STANARD
Published on September 2, 2004
OPTION GRANT NOTICE RenaissanceRe Holdings Ltd. (the "Company"), pursuant to its 2004 Stock Option Incentive Plan (the "Plan"), hereby grants to Holder options (the "Options") to purchase the number of shares of the Company's Stock set forth below. The Options are subject to all of the terms and conditions as set forth herein, as well as the terms and conditions of the Plan, all of which are incorporated herein in their entirety. Capitalized terms not otherwise defined herein shall have the same meaning as set forth in the Plan. In the event of a conflict or inconsistency between the terms and provisions of the Plan and the provisions of this Grant Notice, the Plan shall govern and control. HOLDER: James N. Stanard DATE OF GRANT: August 31, 2004 NUMBER OF SHARES OF STOCK UNDERLYING THE OPTIONS: 2,500,000 EXERCISE PRICE PER SHARE: $74.24 as to one-half (1/2) of the Options (representing 150% of the Fair Market Value on the Date of Grant); and $98.98 as to the remaining one-half (1/2) of the Options (representing 200% of the Fair Market Value on the Date of Grant) EXPIRATION DATE: 10 Years From the Date of Grant VESTING SCHEDULE: Subject to Holder's continued employment with the Company, the Options shall vest and become exercisable on the fifth (5th) anniversary of the Date of Grant, subject to acceleration of vesting (a) upon a Change in Control, as provided in Section 9 of the Plan, (b) upon Holder's termination of employment (i) by the Company without Cause (as defined in Holder's Sixth Amended and Restated Employment Agreement, dated May 19, 2004 (the "Employment Agreement"), (ii) by Holder with Good Reason (as defined in the Employment Agreement), or (iii) by reason of his death or Disability (as described in Section 5.03 of the Employment Agreement), in each case in accordance with Section 3.01(b) of the Employment Agreement, or (c) otherwise at the discretion of the Committee, as provided in Section 7(c) of the Plan. TERMINATION OF EMPLOYMENT: In the event of termination of Holder's employment by reason of his resignation upon the expiration of Employment Agreement on June 30, 2007, Holder shall continue to be treated as employed by the Company for purposes of vesting in the Options for so long as Holder has not engaged in any Competitive Activities (as defined in the Employment Agreement), provided that, if following such resignation and while such Options are unvested and outstanding (A) Holder dies, all such Options shall vest immediately, or (B) Holder voluntarily resigns from the position of Chairman of the Board prior to June 30, 2008, the Committee may cause Holder to forfeit that number of Options which it deems appropriate under the circumstances, taking into account Holder's obligation not to engage in Competitive Activities. In addition, following such resignation, or following his resignation one year after a Change in Control (if earlier than June 30, 2007), or following any termination of Holder's employment by the Company without Cause, or by Executive for Good Reason, or by reason of Executive's death or disability, the Options shall remain outstanding and exercisable (to the extent vested) until the Expiration Date but, subject to the following paragraph, shall immediately expire and terminate if Holder engages in any Competitive Activities in violation of Section 4.04 of the Employment Agreement. The Options shall not expire and terminate by reason of Holder engaging in Competitive Activities unless the procedures set forth in Section 5.05(a)(ii) of the Employment Agreement are complied with. ADDITIONAL TERMS: o Options shall be exercisable in whole shares of Stock only. o Each share of Stock purchased through the exercise of Options shall be paid for in full at the time of the exercise. Upon any exercise of vested Options, unless otherwise determined by the Committee, Holder shall be required to use the "net exercise" procedure described in Section 7(b) of the Plan, and payment of taxes required to be withheld shall be paid by having shares of Stock withheld by the Company in accordance with Section 8(d) of the Plan; provided, however, that Holder may use other permissible methods under the Plan to pay for the exercise price and/or withholding tax if such "net exercise" and/or share withholding methods would materially disadvantage Holder's personal tax position and Holder takes reasonable steps to cooperate with the Company to ensure that the Company will not be treated as a "controlled foreign corporation" for U.S. tax purposes. 2 o This Grant Notice does not confer upon the Holder any right to continue as an employee. o This Grant Notice shall be construed and interpreted in accordance with the laws of the Bermuda, without regard to the principles of conflicts of law thereof. [Signatures to appear on the following page.] 3 THE UNDERSIGNED HOLDER ACKNOWLEDGES RECEIPT OF THIS GRANT NOTICE AND THE PLAN, AND, AS AN EXPRESS CONDITION TO THE GRANT OF OPTIONS HEREUNDER, AGREES TO BE BOUND BY THE TERMS THIS GRANT NOTICE AND THE PLAN. RENAISSANCERE HOLDINGS LTD. HOLDER By: /s/ Stephen H. Weinstein /s/ James N. Stanard ---------------------------------- ----------------------------------- Signature Signature Title: Vice President, General Counsel & Secretary Date: August 31, 2004 ------------------------------ ----------------------------- Date: August 31, 2004 ------------------------------ 4