PartnerRe Ltd. Board of Directors Compensation Policy (as of May 10, 2005)
PartnerRe Ltd. has established a compensation policy for its Board of Directors, offering a mix of cash payments, stock options, and restricted stock units (RSUs). Directors and the Chairman receive annual and quarterly cash compensation, with the option to defer cash into RSUs, which are subject to delivery restrictions. The company matches deferred amounts with additional RSUs. Directors also receive annual stock options and RSUs, both immediately vested but with delivery restrictions. The policy includes reimbursement for business expenses and sets a share ownership target for Directors. Dividend equivalents are paid on RSUs.
Exhibit 10.6
Board of Directors
Compensation Program
As Approved
10 May 2005
| PartnerRe Ltd. Board of Directors Compensation Policy |
- Establish competitive pay levels on a total compensation basis
- Align the interests of Directors and shareholders by using equity as a major component of the total compensation package
- Establish one approach to Director compensation in recognition of PartnerRe’s strategy to rotate Directors’ committee assignments periodically
- Demonstrate good governance and corporate responsibility
As part of the new compensation policy for the members of the Board of Directors and as approved by the Nominating and Governance Committee, PartnerRe offers a competitive mix of cash and equity compensation for each Director and for the Chairman.
The total compensation package for Director service consists of three components- Cash compensation
- Stock Options
- Restricted Stock Units (RSU’s)
| Cash Compensation |
| Annually | Quarterly | |
| Chairman | $180,000 | $45,000 |
| Director | $50,000 | $12,500 |
| Elective Equity Incentive |
Deferred Cash Compensation
Members of the Board may elect to defer part or all of their cash compensation into RSU’s. Election options include deferral of 0%, 50% or 100% of cash compensation.
Deferred cash compensation is converted into immediately vested RSU’s with a minimum delivery date restriction of 5 years. The Director may elect to extend the delivery date restriction to 10 years or 15 years from grant.
Company Match
Should a Board member elect to defer cash into RSU’s, deferred amounts would receive an additional matching award of 25% of the deferred dollar amount. The matching award would be granted in immediately vested RSU’s with a minimum deliver date restriction of 5 years, extendable to 10 years or 15 years from grant.
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| Stock Options |
| Annually | |
| Chairman | $120,000 |
| Director | $100,000 |
Director (including Chairman) stock option awards are immediately vested and the grant price of the stock option awards is equal to the average of highest and lowest sale price on trading day immediately preceding the grant date, as per the shareholder approved 2003 Non-Employee Directors’ Stock Plan.
RSU’s
Members of the Board of Directors are entitled to receive RSU’s on a quarterly basis for their services. The number of RSU’s awarded is determined by the dollar value award divided by the fair market value of PartnerRe Ltd. Common Shares on the grant date.
| Annually | Quarterly | |
| Chairman | $100,000 | $25,000 |
| Director | $80,000 | $20,000 |
RSU awards are immediately vested with a minimum delivery date restriction of 5 years. The Director may elect to extend the delivery date restriction to 10 years or 15 years from grant.
Dividend Equivalents
All RSU awards will receive quarterly dividend equivalent payments, payable in cash. These will be paid at the same time as the Company pays its Common Share dividends.
Delivery Date Restrictions
All RSU awards will have a minimum delivery date restriction of 5 years, extendable at the election of the Director to 10 years or 15 years from grant date. If a Director terminates his/her directorship for any reason other than death, delivery date restrictions still apply. In the case of death, shares are immediately delivered.
| Ownership Target |
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| Travel |
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