BRISTOL WEST HOLDINGS, INC. NON-EMPLOYEE DIRECTORS DEFERRED COMPENSATION AND STOCK AWARD PLAN PURPOSE

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PURPOSE

 

The purpose of this Bristol West Holdings, Inc. Non-Employee Directors’ Deferred Compensation and Stock Award Plan is to provide individuals who are not employees of Bristol West Holdings, Inc. or its subsidiaries who serve as members of the Board (as defined below) an opportunity to defer payment of all or a portion of their Fees (as defined below) and to receive current payment of all or a portion of their Fees in Shares (as defined below) in accordance with the terms and conditions set forth herein.

 

ARTICLE I

 

 

DEFINITIONS

 

 

 

 

 

(i) a sale of all or substantially all of the assets of the Company to a Person or Group that is not Kohlberg Kravis Roberts & Co. or an Affiliate thereof (collectively, the "KKR Partnerships");

(ii) a sale by any member of the KKR Partnerships resulting in more than 50% of the voting stock of the Company being held by a Person or Group that is not a member of the KKR Partnerships; or

(iii) a merger, consolidation, recapitalization or reorganization of the Company with or into another Person which is not a member of the KKR Partnerships;

and following any of the foregoing events in clause (ii)-(iii), (x) the KKR Partnerships no longer have the ability, without the approval of a Person or Group or an Affiliate of the Company that is not a member of the KKR Partnerships, to elect a majority of the Board (or the resulting entity in the transaction) and (y) any Person or Group who is not a member of the KKR Partnerships is or becomes the Beneficial Owner, directly or indirectly, in the aggregate, of a greater percentage of the total voting power of the Company than that held, directly or indirectly, in the aggregate, by the KKR Partnerships.

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ARTICLE II  

 

 

 

 

 

 

ARTICLE III  

 

 

 

 

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ARTICLE IV  

 

 

 

 

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ARTICLE V  

 

 

 

 

 

ARTICLE VI  

 

 

 

 

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ARTICLE VII  

 

 

 

 

 

 

Effective the 15th day of April, 2004.

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APPENDIX A

 

BRISTOL WEST HOLDINGS, INC.

 

DIRECTOR ANNUAL RETAINER ELECTION NOTICE

 

Date_____________

 

I hereby elect to defer receipt of all or a portion of my Director’s Fees (as defined in the Bristol West Holdings, Inc. Non-Employee Directors’ Deferred Compensation and Stock Award Plan) (the "Plan"), commencing on July 1, 2004 and for all succeeding calendar years ("Years") commencing January 1, 2005, in accordance with my elections indicated below.

 

I elect to have my Director’s Fees (including Committee Fees, if any) deferred as follows (fill in appropriate percentage below):

 

(a)  _______% of the aggregate Director’s Fees shall be deferred to my Share Account (as defined in the Plan), to which Bristol West Holdings, Inc. (the "Company") shall credit hypothetical Shares (as defined in the Plan) in the manner set forth in the Plan.

 

I understand that my election above to defer all or a portion of my Director’s Fees shall continue from one Year to the next, unless I change my election in writing at least one (1) month prior to the commencement of the Year in which I would like my changed election to be effective. I also understand that my Share Account generally shall become payable on the earlier to occur of (i) the first day of January following my separation from the Board or (ii) the date on which I elect to receive payment of my deferred Fees (the "Election Date") (my Election Date, if any, shall be _______________), and in any event within thirty (30) days after the occurrence of a Change in Control (as defined in the Plan). I elect to receive the payments due to me pursuant to the Plan in the event of a Change in Control as follows (check the method desired below):

 

_______ in a cash, lump sum payment

_______ in Shares

The remainder of my Director’s Fees shall not be deferred into hypothetical Shares, and shall be payable to me currently as follows (fill in the appropriate percentage below):

(b)  _______% of my Director’s Fees that I have elected not to defer shall be paid to me in arrears directly in cash as they accrue;

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(c)  _______% of my Director’s Fees that I have elected not to defer shall be paid to me in arrears directly in Shares as they accrue, in accordance with the Plan.

 

I understand that (i) to the extent I make no election under this election notice or do not designate the manner in which any portion of my Director’s Fees that I elect to receive currently shall be payable to me, I will receive such portion(s) of my Director’s Fees in cash; (ii) all elections I have made above with respect to current receipt of my Fees applicable to a particular Year may not be amended or revoked with respect to such Year, but may be amended for subsequent Years to the extent I change my election at least one (1) month prior to the commencement of the Year in which I would like my changed election to be effective, and (iii) if I amend my existing election to defer Fees in order to receive Fees in cash and/or in Shares following each fiscal quarter, I may not subsequently re-elect to def er payment of Fees for at least one Year.

 

 

 

 

In the event of my death prior to receipt of all or any balance of such Fees and dividends, if any, thereon so accumulated, I designate ______________________ as my beneficiary to receive Shares (or, if applicable, the funds) payable.

 

 

Acknowledged and Agreed this __ day of __________, 2004.

 

 

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Director