Markel Corporation Executive Bonus Plan Description for Senior Executive Officers
Markel Corporation has established a bonus plan for its Senior Executive Officers, where cash bonuses are determined by the company's five-year average compound growth in book value per share. The percentage of base salary awarded as a bonus increases with higher growth rates, ranging from 0% for growth under 11% to 250% for growth of 24%, with discretionary bonuses for growth above 24%. Book value calculations exclude certain equity issuance benefits and goodwill amortization costs. The plan is overseen by the Compensation Committee and applies to the 2003 calendar year.
Exhibit 10.1
Description of Executive Bonus Plan
In addition to base salary, Markel Corporation (the “Company”) has approved a bonus plan for Senior Executive Officers in which cash bonuses are paid based on increases in the book value of the Company’s Common Stock. Under the Executive Bonus Plan, bonuses for Senior Executive Officers, expressed as a percentage of base salary, are awarded based on a five-year average of the compound growth in book value per share of Common Stock. For calendar year 2003, the Compensation Committee, after considering the effect of a lower interest rate environment for the past several years, has established the following bonus plan for Senior Executive Officers.
| 5 Year Average Compound Growth In Adjusted Book Value Per Share | Bonus as % of Base Salary | |
| Under 11% | 0% | |
| 11% | 25% | |
| 12% | 30% | |
| 13% | 40% | |
| 14% | 50% | |
| 15% | 60% | |
| 16% | 75% | |
| 17% | 90% | |
| 18% | 100% | |
| 19% | 110% | |
| 20% | 125% | |
| 21% | 145% | |
| 22% | 170% | |
| 23% | 200% | |
| 24% | 250% | |
| Over 24% | Discretionary |
Book value calculations are adjusted to exclude the benefit of issuing equity securities at prices above the preceding year end book value per share and to exclude the goodwill amortization costs resulting from a transaction in which equity securities are issued.
