1. |
To elect Dominic J. Addesso, John J. Amore, William F. Galtney, Jr., John A. Graf, Gerri Losquadro, Roger M. Singer, Joseph V. Taranto and John A. Weber as directors of
the Company, each to serve for a one-year period to expire at the 2020 Annual General Meeting of Shareholders or until such director’s successor shall have been duly elected or appointed or until such director’s office is otherwise
vacated.
|
2. |
To appoint PricewaterhouseCoopers LLP, an independent registered public accounting firm, as the Company’s independent auditor for the year ending December 31, 2019 and
authorize the Company’s Board of Directors, acting through its Audit Committee, to determine the independent auditor’s remuneration.
|
3. |
To approve, by non-binding advisory vote, 2018 compensation paid to the Company’s Named Executive Officers.
|
4. |
To consider and act upon such other business, if any, as may properly come before the meeting and any and all adjournments thereof.
|
By Order of the Board of Directors
|
|
Sanjoy Mukherjee
|
|
Executive Vice President,
|
|
General Counsel and Secretary
|
|
April 11, 2019
|
|
Hamilton, Bermuda
|
PAGE
|
||
GENERAL INFORMATION
|
1 |
|
EXECUTIVE SUMMARY
|
3 | |
PROPOSAL NO. 1 – ELECTION OF DIRECTORS
|
9 | |
Information Concerning Director Nominees
|
11 | |
Information Concerning Executive Officers
|
19 | |
THE BOARD OF DIRECTORS AND ITS COMMITTEES
|
23 | |
Director Independence
|
25 | |
BOARD STRUCTURE AND RISK OVERSIGHT
|
28 | |
BOARD COMMITTEES
|
32 | |
Audit Committee
|
32 | |
Audit Committee Report
|
32 | |
Compensation Committee
|
34 | |
Compensation Committee Report
|
34 | |
Nominating and Governance Committee
|
35 | |
Code of Ethics for CEO and Senior Financial Officers
|
37 | |
Shareholder and Interested Party Communications with Directors
|
37 | |
COMMON SHARE OWNERSHIP BY DIRECTORS AND EXECUTIVE OFFICERS
|
38 | |
PRINCIPAL BENEFICIAL OWNERS OF COMMON SHARES
|
39 | |
DIRECTORS’ COMPENSATION
|
40 | |
2018 Director Compensation Table
|
41 | |
COMPENSATION DISCUSSION AND ANALYSIS
|
42 | |
Summary Compensation Table
|
68 | |
2018 Grants of Plan-Based Awards
|
69 | |
Outstanding Equity Awards at Fiscal Year-End 2018
|
70 | |
Shares Vested
|
71 | |
2018 Pension Benefits Table
|
72 | |
2018 Non-Qualified Deferred Compensation Table
|
73 | |
CEO PAY RATIO DISCLOSURE
|
74 | |
EMPLOYMENT, CHANGE OF CONTROL AND OTHER AGREEMENTS
|
75 | |
Potential Payments Upon Termination or Change in Control
|
77 | |
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
|
80 | |
PROPOSAL NO. 2 – APPOINTMENT OF INDEPENDENT AUDITORS
|
81 | |
PROPOSAL NO. 3 – NON-BINDING ADVISORY VOTE ON EXECUTIVE COMPENSATION
|
82 | |
MISCELLANEOUS – GENERAL MATTERS
|
83 |
· |
Everest’s planned new U.S. operational headquarters in New Jersey which is expected to qualify for LEED status and contain such features as a green roof as part of the
complex, charging stations for automobiles, and various other sustainability and energy savings features;
|
· |
Everest’s Bermuda headquarters and offices which maintain such features as double glazed solar controlled glass, air conditioning which is water cooled using sea water
from wells, and energy-conserving lighting; and
|
· |
Everest’s New York City office building where Everest is now a major tenant following recent employee and business expansion which is LEED Gold and Energy Star
certified.
|
Governance Profile Best Practice
|
Company Practice
|
|
✓
|
Size of Board
|
8
|
✓
|
Number of Independent Directors
|
6
|
✓
|
Board Independence Standards
|
The Board has adopted director independence standards stricter than the listing standards of the NYSE
|
✓
|
Director Independence on Key Committees
|
The Board’s Audit, Compensation and Nominating and Governance Committees are composed entirely of independent directors
|
✓
|
Separate Chairman and CEO
|
Yes
|
✓
|
Independent Lead Director
|
Yes
|
✓
|
Annual Election of All Directors
|
Yes
|
✓
|
Majority Voting for Directors
|
Yes
|
✓
|
Board Meeting Attendance
|
Each director or appointed alternate director attended 100% of Board meetings in 2018
|
✓
|
Annual General Meeting Attendance
|
Director attendance expected at Annual General Meeting per Governance Guidelines, and 100% of directors attended the 2018 Annual General Meeting
|
✓
|
No Over-Boarding
|
Directors do not sit on the boards of other publicly traded companies
Directors are prohibited from sitting on the boards of competitors
|
✓
|
Regular Executive Sessions of Non-Management Directors
|
Yes
|
✓
|
Shareholder Access
|
No minimum share ownership or holding thresholds necessary to nominate qualified director to Board
|
✓
|
Policy Prohibiting Insider Pledging or Hedging of Company’s Stock
|
Yes
|
✓
|
Annual Equity Grant to Non-Employee Directors
|
Yes
|
✓
|
Annual Board and Individual Director Performance Evaluations
|
Yes
|
✓
|
Clawback Policy
|
Clawback Policy covering current and former employees, including Named Executive Officers, providing for forfeiture and repayment of any incentive
based compensation granted or paid to an individual during the period in which he or she engaged in material willful misconduct including but not limited to fraudulent misconduct
|
✓
|
Code of Business Conduct and Ethics for Directors and Executive Officers
|
Yes
|
✓
|
No Separate Change in Control Agreement for the CEO
|
CEO participates in the Senior Executive Change in Control Plan (“CIC Plan”) along with the other Named Executive Officers
|
Governance Profile Best Practice
|
Company Practice
|
|
✓
|
No Automatic Accelerated Vesting of Equity Awards
|
Accelerated equity vesting provisions are not and will not be incorporated in the employment agreements of any Named Executive Officer
|
✓
|
Double Trigger for Change-in-Control
|
Yes
|
✓
|
No Excise Tax Assistance
|
No “gross-up” payments by the Company of any “golden parachute” excise taxes upon a change-in-control
|
✓
|
Say on Pay Frequency
|
Say on Pay Advisory Vote considered by Shareholders annually
|
✓
|
No Re-pricing of Options and SARs
|
The Board adheres to a strict policy of no re-pricing of Options and SARs
|
✓
|
Minimum Vesting Period of Options and Restricted Shares
|
Minimum 1-year vesting period for equity awards
However, the Board has always instituted a 5-year vesting period for equity awards to executive officers except for performance shares which must
meet key performance metrics over the course of 3 years prior to settlement
3-year vesting period for equity awards to Directors
|
✓
|
Share Recycling
|
No liberal share recycling
|
✓
|
Stock Ownership Guidelines for Executive Officers
|
Six times base salary for CEO; three times base salary for other Named Executive Officers
|
✓
|
Stock Ownership Guidelines for Non-Management Directors
|
Six times annual retainer
|
✓
|
Use of Performance Shares as Element of Long-Term Incentive Compensation
|
Yes
|
Proposal
|
Board’s Voting Recommendations
|
Page
|
Election of Director Nominees
(Proposal 1) |
FOR ALL DIRECTOR NOMINEES
|
9 |
Appointment of PricewaterhouseCoopers LLP as
Company Auditor (Proposal 2) |
FOR
|
81 |
Non-Binding Advisory Vote on Executive
Compensation (Proposal 3) |
FOR
|
82 |
· |
Leadership: Demonstrated ability to hold significant
leadership positions and effectively manage complex organizations is important to evaluating and developing key management talent.
|
· |
Insurance and/or Reinsurance Industry Experience:
Experience in the insurance and/or reinsurance markets is critical to strategic planning and oversight of our business operations.
|
· |
Risk Management: Experience in identifying, assessing and
managing risks is critical to oversight of current and emerging organizational and systemic risks in order to inform and adapt the Company’s strategic planning.
|
· |
Regulatory: Understanding of the laws and regulations that impact our heavily regulated industry, as well as understanding the impact of government actions and public policy. Both areas are
important to oversight of insurance operations.
|
· |
Finance and Accounting: Financial experience and literacy
are essential for understanding and overseeing our financial reporting, investment performance and internal controls to ensure transparency and accuracy.
|
· |
Corporate Governance: Understanding of corporate governance matters is essential to ensuring effective governance of the Company and protecting shareholder interests.
|
· |
Business Operations: A practical understanding of
developing, implementing and assessing our business operations and processes, and experience making strategic decisions, are critical to the oversight of our business, including the assessment of our operating plan, risk management and
long-term sustainability strategy.
|
· |
Information Technology/Cybersecurity: A practical understanding of information systems and technology use in our business operations and processes, as well as a recognition of the risk
management aspects of cyber risks and cyber security.
|
· |
International: Experience and knowledge of global insurance
and financial markets is especially important in understanding and reviewing our business and strategy.
|
|
Age: 65
Director Since: September 19, 2012
Non-Independent
Committees:
· Investment Policy
· Underwriting
· Executive
|
·
|
Executive Leadership
|
·
|
Corporate Governance
|
·
|
Insurance/Reinsurance Industry Experience
|
·
|
International
|
·
|
Finance and Accounting
|
·
|
Risk Management
|
·
|
Business Operations
|
·
|
Regulatory
|
·
|
Investments
|
·
|
Information Technology/Cyber Security
|
·
|
Mergers & Acquisitions
|
|
Age: 70
Director Since: September 19, 2012
Independent
Committees:
· Audit
· Compensation (Chair)
· Nominating and Governance
· Underwriting
|
· |
Executive Leadership
|
· |
Insurance/Reinsurance Industry Experience
|
· |
Finance and Accounting
|
· |
Corporate Governance
|
· |
Business Operations
|
· |
International
|
· |
Risk Management
|
Age: 66
Director Since: March 12, 1996 Independent Committees:
· Audit
· Compensation
· Executive
· Nominating and Governance (Chair)
· Underwriting
|
· |
Executive Leadership
|
· |
Insurance/Reinsurance Industry Experience
|
· |
Finance and Accounting
|
· |
Investments
|
· |
Merger & Acquisition
|
· |
Corporate Governance
|
· |
Business Operations
|
· |
Risk Management
|
Age: 59
Director Since: May 18, 2016 Independent Committees:
· Audit
· Compensation
· Nominating and Governance
· Investment Policy
|
· |
Executive Leadership
|
· |
Insurance/Reinsurance Industry Experience
|
· |
Corporate Governance
|
· |
Risk Management
|
· |
Finance and Accounting
|
· |
Investments
|
· |
International
|
· |
Business Operations
|
· |
Regulatory
|
Age: 68
Director Since: May 14, 2014 Independent Committees:
· Audit
· Compensation
· Nominating and Governance
· Underwriting (Chair)
|
· |
Executive Leadership
|
· |
Insurance/Reinsurance Industry Experience
|
· |
Corporate Governance
|
· |
Finance and Accounting
|
· |
Risk Management
|
· |
Business Operations
|
· |
International
|
· |
Information Technology/Cyber Security
|
Age: 72
Director Since: February 24, 2010 Independent Committees:
· Audit (Chair)
· Compensation
· Nominating and Governance
|
· |
Executive Leadership
|
· |
Insurance/Reinsurance Industry Experience
|
· |
Corporate Governance
|
· |
Finance and Accounting
|
· |
Regulatory
|
· |
International
|
· |
Legal
|
· |
Mergers & Acquisitions
|
Age: 70
Director Since: March 12, 1996 Non-Independent Committees:
· Executive
· Investment Policy
|
· |
Executive Leadership
|
· |
Insurance/Reinsurance Industry Experience
|
· |
Business Operations
|
· |
Corporate Governance
|
· |
Finance and Accounting
|
· |
Mergers & Acquisitions
|
· |
Investments
|
· |
Regulatory
|
· |
International
|
· |
Risk Management
|
Age: 74
Director Since: May 22, 2003 Independent Committees:
· Audit
· Compensation
· Executive
· Investment Policy
· Nominating and Governance
|
· |
Executive Leadership
|
· |
Insurance/Reinsurance Industry Experience
|
· |
Business Operations
|
· |
Finance and Accounting
|
· |
Investments
|
· |
International
|
· |
Mergers & Acquisitions
|
· |
Corporate Governance
|
· |
Risk Management
|
|
Age: 55
Mr. Howie is the Executive Vice President, Chief
Financial Officer and Treasurer of the Company, Everest Re, Everest Holdings and Everest Global. He joined the Company on March 26, 2012 as Executive Vice President of Everest Global and Everest Re. During 2016, he became the Executive Vice
President, Chief Financial Officer and Treasurer of Everest Premier Insurance Company (“Everest Premier”) and Everest Denali Insurance Company (“Everest Denali”). During 2015, he assumed the position of Treasurer for Everest Global, Mt.
Logan Re, Ltd. (“Mt. Logan”), Everest Security, Everest National, Everest Indemnity, Mt. Whitney Securities, LLC, SIG Sports, Leisure and Entertainment Risk Purchasing Group, LLC, Specialty Insurance Group, Inc., (“SIG”) and Premiere
Underwriting Services, Inc. From 2015 to 2016, he served as Treasurer of Heartland Crop Insurance, Inc. (“Heartland”). In 2015, he became a director, Executive Vice President and Treasurer of Everest International Holdings (Bermuda), Ltd.
(“Bermuda Holdings”) and Everest International Assurance, Ltd. (“International Assurance”), a director and Treasurer of Everest Preferred International Holdings, Ltd. (“Preferred Holdings”) and a director of Everest National and Everest
Indemnity. In 2013, he became a director of Mt. Logan and Mt. Whitney and the Chief Financial Officer of Everest Indemnity, Everest National and Everest Security. He became a director of Everest Security during 2014. During 2012, he became
a director of Everest Re, Bermuda Re, International Re, Everest Global and Everest Holdings. Mr. Howie serves as a director of Security First Insurance Company, a subsidiary of Security First Insurance Holdings, LLC, since 2014.
|
|
Age:
53
Mr. Doucette is the President and CEO of the
Reinsurance Division with oversight of all Reinsurance Operations worldwide. He formerly served as the Executive Vice President and Chief Underwriting Officer for Worldwide Reinsurance and Insurance for the Company, Everest Re, and
Everest National. He became the Chief Underwriting Officer of the Company and Everest Re in 2012, after having assumed the title of Chief Underwriting Officer for Worldwide Reinsurance for those companies in 2011. In 2016, he became a
director of International Re and in 2013 he became a director of Mt. Logan. Since 2011, he has served as a director of Bermuda Re and Everest Re. Upon joining the Company in 2008, he became Executive Vice President of the Company, Everest
Global, and Everest Re.
Prior to joining the Company, Mr. Doucette worked at Max Capital Group Ltd. (formerly Max Re Capital Ltd.)
(“Max Capital”) from 2000 to 2008, serving in various capacities including President and Chief Underwriting Officer of the P&C Reinsurance division of Max Capital, where he was responsible for new products and geographic expansion.
Prior to that, he was an Associate Director at Swiss Re New Markets, a division of Swiss Reinsurance Company, between 1997 and 2000, where he held various pricing, structuring and underwriting roles in connection with alternative risk
transfer and structured products. He was an actuarial consultant at Tillinghast from 1989 to 1997.
|
|
Age: 52
Mr. Mukherjee is the Executive Vice President, Secretary and General Counsel of the Company, and the Managing Director and CEO of
Bermuda Re where he also serves as a director. Since 2006, he has served as Secretary, General Counsel and Chief Compliance Officer of the Company, Everest Global, Everest Holdings and Everest Re, also serving as a director of the latter
two. During 2016, he became a director of Everest Premier and Everest Denali. In 2015, he became a director, Chairman and CEO of Preferred Holdings and Bermuda Holdings, a director of Everest Service Company (UK), Ltd., Everest Corporate
Member, Ltd. and International Assurance. During 2013, he became a director of Mt. Logan and SIG and Secretary and General Counsel of SIG Sports, Leisure and Entertainment Risk Purchasing Group LLC. From 2009 to 2015, he served as Secretary
of Ireland Re and Ireland Underwriting, where he continues to serve as director. Between 2011 and 2016, Mr. Mukherjee served as a director, Secretary and General Counsel of Heartland. Since 2005, he has served as General Counsel of Everest
National and Mt. McKinley Managers, L.L.C., a director and Secretary of Everest National, Everest Indemnity and Everest Security, and as Secretary of Everest Canada until 2015. Since 2008, he has been Secretary and a director of Mt.
Whitney. He became a Vice President of Mt. McKinley in 2002, where he also served as Secretary and Compliance Officer since 2005 and as a director from 2011, until that company’s sale in 2015. In 2017, he became a director of Everest Dublin
Insurance Holdings Limited. From 2005 through 2007, he served as a director of Bermuda Re. He joined the Company in 2000 as an Associate General Counsel.
|
|
Age: 46 Mr. Zaffino is an Executive Vice President of the Company, and the President and CEO of Everest Insurance®
and responsible for overseeing all insurance operations worldwide. Mr. Zaffino joined Everest in 2015, and became a director and the President of Everest National, Everest Indemnity, Everest Security and Specialty Insurance Group. In
2016, he became a director of Everest Canada and a director and President of Everest Denali and Everest Premier.
Prior to joining the Company, he was the President of Victor O. Schinnerer, Inc. (a subsidiary of Marsh, Inc.), from
2013 to 2015 and was previously a Managing Director of Marsh, Inc. from 2010 to 2013. Mr. Zaffino was a co-founder of Century Atlantic Capital Management and served as its Chief Operating Officer from 2008 to 2010. From 2005 to 2008, Mr.
Zaffino was a Managing Principal of Integro Insurance Brokers. Prior to that, he served as an Executive Vice President at Willis North America from 2004 to 2005. From 1999 to 2004, Mr. Zaffino worked at ACE Group in a variety of roles as
Vice President and Senior Vice President, where his responsibilities varied from business planning and strategic development to overseeing field operations for ACE Risk Management and ACE Excess Casualty. He held different underwriting
roles at Reliance National Insurance Company, including Underwriting Manager and Risk Management Underwriter from 1995 to 1999, and was an underwriter at Chubb & Son, Personal Lines from 1994 to 1995.
|
Board of Directors
|
||||||||
Dominic
Addesso |
John J.
Amore |
William F.
Galtney, Jr. |
John A.
Graf |
Gerri
Losquadro |
Roger M.
Singer |
Joseph V.
Taranto |
John A.
Weber |
|
Skills & Experience
|
||||||||
Executive Leadership
|
X
|
X
|
X
|
X
|
X
|
X
|
X
|
X
|
Insurance and/or Reinsurance
Industry Experience |
X
|
X
|
X
|
X
|
X
|
X
|
X
|
X
|
Risk Management
|
X
|
X
|
X
|
X
|
X
|
X
|
X
|
|
Regulatory
|
X
|
X
|
X
|
X
|
||||
Finance/Capital Management
and Accounting |
X
|
X
|
X
|
X
|
X
|
X
|
X
|
X
|
Corporate Governance
|
X
|
X
|
X
|
X
|
X
|
X
|
X
|
X
|
Business Operations
|
X
|
X
|
X
|
X
|
X
|
X
|
X
|
|
International
|
X
|
X
|
X
|
X
|
X
|
X
|
X
|
|
Investments
|
X
|
X
|
X
|
X
|
X
|
|||
Merger & Acquisition
|
X
|
X
|
X
|
X
|
X
|
|||
Information Technology/
Cyber Security |
X
|
X
|
||||||
Legal
|
X
|
· |
Audit Committee
|
· |
Nominating and Governance
|
· |
Compensation Committee
|
· |
Executive Committee
|
· |
Investment Policy Committee
|
· |
Underwriting Committee
|
Name
|
Audit
|
Compensation
|
Executive
|
Investment
Policy |
Nominating
and Governance |
Underwriting
Committee |
Independent
|
Dominic J. Addesso
|
X
|
X
|
X
|
||||
John J. Amore
|
X
|
Chair
|
X
|
X
|
X
|
||
William F. Galtney, Jr.
|
X
|
X
|
X
|
Chair
|
X
|
X
|
|
John A. Graf
|
X
|
X
|
X
|
X
|
X
|
||
Gerri Losquadro
|
X
|
X
|
X
|
Chair
|
X
|
||
Roger M. Singer
|
Chair
|
X
|
X
|
X
|
|||
Joseph V. Taranto
|
X
|
X
|
|||||
John A. Weber
|
X
|
X
|
X
|
X
|
X
|
X
|
|
Meetings
|
4
|
4
|
0
|
4
|
4
|
4
|
|
· |
no director who is an employee, or whose immediate family member is an executive officer of the Company, is deemed independent until three years after the end of such
employment relationship;
|
· |
no director is independent who:
|
(i) |
is a current partner or employee of a firm that is the Company’s internal or external auditor;
|
(ii) |
has an immediate family member who is a current partner of such firm;
|
(iii) |
has an immediate family member who is a current employee of such firm and personally works on the Company’s audit; or
|
(iv) |
was or had an immediate family member who was within the last three years a partner or employee of such firm and personally worked on the Company’s audit within that
time;
|
· |
no director who is employed, or whose immediate family member is employed, as an executive officer of another company where any of our present executives serve on that
company’s compensation committee is deemed independent until three years after the end of such service or the employment relationship;
|
· |
no director who is an executive officer or an employee, or whose immediate family member is an executive officer, of a company that makes payments to, or receives
payments from, the Company for property or services in an amount that, in any single year, exceeds $10,000 is deemed independent;
|
· |
no director who has a personal services contract with the Company, or any member of the Company’s senior management, is independent;
|
· |
no director who is affiliated with a not-for-profit entity that receives significant contributions from the Company is independent; and
|
· |
no director who is employed by a public company at which an executive officer of the Company serves as a director is independent.
|
· |
no director who is a member of the Audit Committee shall be deemed independent if such director is affiliated with the Company or any of its subsidiaries in any
capacity, other than in such director’s capacity as a member of our Board of Directors, the Audit Committee or any other Board committee or as an independent subsidiary director; and
|
· |
no director who is a member of the Audit Committee shall be deemed independent if such director receives, directly or indirectly, any consulting, advisory or other
compensatory fee from the Company or any of its subsidiaries, other than fees received in such director’s capacity as a member of our Board of Directors, the Audit Committee or any other Board committee, or as an independent subsidiary
director, and fixed amounts of compensation under a retirement plan, including deferred compensation, for prior service with the Company (provided such compensation is not contingent in any way on continued service).
|
· |
no director shall be considered independent who:
|
(i) |
is currently an officer (as defined in Rule 16a-1(f) of the Securities Exchange Act of 1934 (the “Exchange Act”)) of the Company or a subsidiary of the Company, or
otherwise employed by the Company or subsidiary of the Company;
|
(ii) |
receives compensation, either directly or indirectly, from the Company or a subsidiary of the Company, for services rendered as a consultant or in any capacity other
than as a director, except for an amount that does not exceed the dollar amount for which disclosure would be required pursuant to Item 404(a) of Regulation S-K; or
|
(iii) |
possesses an interest in any other transaction for which disclosure would be required pursuant to Item 404(a) of Regulation S-K.
|
· |
no director who does not meet the requirements of an “outside director” as defined in Section 162(m) of the Internal Revenue Code of 1986, as amended (the “Code”), shall
be considered independent.
|
· |
Coordinating executive sessions of the independent members of the Board without management present;
|
· |
Authorization to call meetings of the independent directors;
|
· |
Serving as a liaison between the Chairman and the independent directors and providing a forum for independent director feedback at executive sessions;
|
· |
Communicating regularly with the CEO and the other directors on matters of Board governance;
|
· |
Assisting in Board meeting agenda preparation in consultation with the Chairman;
|
· |
Overseeing the annual Board self-evaluation process including individual director evaluations and facilitating discussion of the results;
|
· |
Assuring that all Board members carry out their responsibilities as directors;
|
· |
If requested and, when appropriate, consultation and direct communication with major shareholders as the independent representative of the Board.
|
BOARD COMMITTEES |
2018
|
2017
|
|
Audit Fees(1)
|
$ 4,799,655
|
$ 4,783,026
|
Audit-Related Fees(2)
|
335,800
|
227,594
|
Tax Fees(3)
|
177,000
|
1,175,479
|
All Other Fees(4)
|
20,000
|
21,243
|
(1) |
Audit fees include the annual audit and quarterly financial statement reviews, internal control audit (as required by the Sarbanes Oxley Act of 2002), subsidiary audits, and
procedures required to be performed by the independent auditors to be able to form an opinion on the Company’s consolidated financial statements. Audit fees also include statutory audits or financial audits of subsidiaries or affiliates
of the Company and services associated with SEC registration statements, periodic reports and other documents filed with the SEC or other documents issued in connection with securities offerings.
|
(2) |
Audit-related fees include assurance and related services that are reasonably related to the performance of the audit or review of the Company’s financial statements;
accounting consultations related to accounting, financial reporting or disclosure matters not classified as “audit services”; assistance with understanding and implementing new accounting and financial reporting guidance from rulemaking
authorities; financial audits of employee benefit plans; agreed-upon or expanded audit procedures related to accounting and/or billing records required to respond to or comply with financial, accounting or regulatory reporting matters and
assistance with internal control reporting requirements.
|
(3) |
Tax fees include tax compliance, tax planning and tax advice and may be granted general pre-approval by the Audit Committee.
|
(4) |
All other fees are for accounting and research subscriptions.
|
Roger M. Singer, Chairman
|
|
John J. Amore
|
|
William F. Galtney, Jr.
|
|
John A. Graf
|
|
Gerri Losquadro
|
|
John A. Weber
|
John J. Amore, Chairman
|
|
William F. Galtney, Jr.
|
|
John A. Graf
|
|
Gerri Losquadro
|
|
Roger M. Singer
|
|
John A. Weber
|
William F. Galtney, Jr., Chairman
|
|
John J. Amore
|
|
John A. Graf
|
|
Gerri Losquadro
|
|
Roger M. Singer
|
|
John A. Weber
|
COMMON SHARE OWNERSHIP BY DIRECTORS AND EXECUTIVE OFFICERS
|
Amount and Nature of
|
Percent of
|
||
Name of Beneficial Owner
|
Beneficial Ownership
|
Class(13)
|
|
John J. Amore
|
17,667
|
(1)
|
*
|
William F. Galtney, Jr.
|
68,526
|
(2)
|
*
|
John A. Graf
|
8,550
|
(3)
|
*
|
Gerri Losquadro
|
10,267
|
(4)
|
*
|
Roger M. Singer
|
13,432
|
(5)
|
*
|
Joseph V. Taranto
|
339,008
|
(6)
|
*
|
John A. Weber
|
13,595
|
(7)
|
*
|
Dominic J. Addesso
|
100,818
|
(8)
|
*
|
John P. Doucette
|
24,747
|
(9)
|
*
|
Craig Howie
|
18,562
|
(10)
|
*
|
Sanjoy Mukherjee
|
34,719
|
(11)
|
*
|
Jonathan Zaffino
|
10,665
|
(12)
|
*
|
All directors, nominees and executive officers as a group (12 persons)
|
660,556
|
1.4
|
* |
Less than 1%
|
(1) |
Includes 454 shares issuable upon the exercise of share options within 60 days of March 18, 2019. Also includes 3,166 restricted shares issued to Mr. Amore under the
Company’s 2003 Non-Employee Director Equity Compensation Plan (“2003 Directors Plan”) which may not be sold or transferred until the vesting requirements are satisfied.
|
(2) |
Includes 40,750 shares owned by various family related investments in which Mr. Galtney maintains a beneficial ownership and for which he serves as the General Partner.
Also includes 3,166 restricted shares issued to Mr. Galtney under the 2003 Directors Plan which may not be sold or transferred until the vesting requirements are satisfied.
|
(3) |
Includes 3,166 restricted shares issued to Mr. Graf under the 2003 Directors Plan and 343 restricted shares issued under the Company’s 2009 Non Employer Director Equity
Compensation Plan (“2009 Directors Plan”) which may not be sold or transferred until the vesting requirements are satisfied.
|
(4) |
Includes 3,166 restricted shares issued to Ms. Losquadro under the 2003 Directors Plan which may not be sold or transferred until the vesting requirements have been
satisfied.
|
(5) |
Includes 3,166 restricted shares issued to Mr. Singer under the 2003 Directors Plan which may not be sold or transferred until the vesting requirements are satisfied.
|
(6) |
Includes 8,000 shares owned by the Taranto Family Foundation in which Mr. Taranto maintains a beneficial ownership. Also, includes 3,166 restricted shares issued to Mr.
Taranto under the 2003 Directors Plan which may not be sold or transferred until the vesting requirements are satisfied.
|
(7) |
Includes 6,596 shares owned through family investments in which Mr. Weber maintains a beneficial ownership. Also, includes 3,166 restricted shares issued to Mr. Weber
under the 2003 Directors Plan which may not be sold or transferred until the vesting requirements are satisfied.
|
(8) |
Includes 3,080 shares owned by the Addesso Family Trust in which Mr. Addesso maintains a beneficial ownership. Also includes 31,017 restricted shares issued to Mr.
Addesso under the Company’s 2010 Stock Incentive Plan which may not be sold or transferred until the vesting requirements have been satisfied.
|
(9) |
Includes 8,493 restricted shares issued to Mr. Doucette under the Company’s 2010 Stock Incentive Plan which may not be sold or transferred until the vesting requirements
have been satisfied.
|
(10) |
Includes 5,973 restricted shares issued to Mr. Howie under the Company’s 2010 Stock Incentive Plan which may not be sold or transferred until the vesting requirements
have been satisfied.
|
(11) |
Includes 5,639 restricted shares issued to Mr. Mukherjee under the Company’s 2010 Stock Incentive Plan which may not be sold or transferred until the vesting requirements
have been satisfied.
|
(12) |
Includes 7,190 restricted shares issued to Mr. Zaffino under the Company’s 2010 Stock Incentive Plan which may not be sold or transferred until the vesting requirements
have been satisfied.
|
(13) |
Based on 45,821,728 total Common Shares outstanding and entitled to vote as of March 18, 2019.
|
PRINCIPAL BENEFICIAL OWNERS OF COMMON SHARES
|
Number of Shares
|
Percent of
|
||||
Name and Address of Beneficial Owner
|
Beneficially Owned
|
Class
|
|||
Everest International Reinsurance, Ltd.
|
9,719,971
|
(1)
|
19.3%
|
||
Seon Place, 141 Front Street, 4th Floor
|
|||||
Hamilton HM 19, Bermuda
|
|||||
The Vanguard Group
|
4,344,357
|
(2)
|
10.7%
|
||
100 Vanguard Boulevard
|
|||||
Malvern, Pennsylvania 19355
|
|||||
BlackRock, Inc.
|
3,382,386
|
(3)
|
8.3%
|
||
55 East 52nd Street
|
|||||
New York, New York 10055
|
|||||
Boston Partners
|
2,486,855
|
(4)
|
6.1%
|
||
One Beacon Street
|
|||||
30th Floor
|
|||||
Boston, Massachusetts 02108
|
|||||
Alliance Bernstein L.P.
|
2,152,832
|
(5)
|
5.3%
|
||
1345 Avenue of the Americas
|
|||||
New York, New York 10105
|
(1) |
Everest International Reinsurance, Ltd. (“International Re”) a direct wholly-owned subsidiary of the Company, obtained the Company’s Common Shares from Everest Preferred
International Holdings (“Preferred Holdings”), a direct wholly owned subsidiary of the Company, in exchange for preferred stock issued by International Re. Preferred Holdings had obtained the Company’s common shares from Everest
Reinsurance Holdings Inc. in exchange for preferred stock issued by International Re. International Re had sole power to vote and direct the disposition of 9,719,971 Common Shares as of December 31, 2018. According to the Company’s
Bye-laws, the total voting power of any Shareholder owning more than 9.9% of the Common Shares will be reduced to 9.9% of the total voting power of the Common Shares.
|
(2) |
The Vanguard Group reports in its Schedule 13G that it has sole power to vote or direct the vote of 48,144 Common Shares, shared voting power for 14,724 Common Shares,
sole dispositive power with respect to 4,282,490 Common Shares and shared dispositive power with respect to 61,867 Common Shares.
|
(3) |
BlackRock, Inc. reports in its Schedule 13G that it has sole power to vote or direct the vote of 3,012,703 Common Shares and sole dispositive power with respect to
3,382,386 Common Shares.
|
(4) |
Boston Partners reports in its Schedule 13G that it has sole power to vote or direct the vote of 2,171,399 Common Shares, shared voting power for 2,676 Common Shares,
sole dispositive power with respect to 2,486,855 Common Shares and shared dispositive power with respect to no Common Shares.
|
(5) |
Alliance Bernstein L.P. reports in its Schedule 13G that it has sole power to vote or direct the vote of 1,910,511 Common Shares, shared voting power for no Common
Shares, sole dispositive power with respect to 2,150,132 Common Shares and shared dispositive power with respect to 2,700 Common Shares.
|
Change in
|
|||||||
Pension Value
|
|||||||
and Nonqualified
|
|||||||
Fees
|
Non-Equity
|
Deferred
|
|||||
Earned or
|
Share
|
Option
|
Incentive Plan
|
Compensation
|
All Other
|
||
Name
|
Paid in Cash(1)
|
Awards(2)
|
Awards(3)
|
Compensation
|
Earnings
|
Compensation(4)
|
Total
|
John J. Amore
|
$ 125,000
|
$ 363,585
|
$ —
|
$ —
|
$ —
|
$ 18,545
|
$ 507,130
|
William F. Galtney, Jr.
|
125,000
|
363,585
|
—
|
—
|
—
|
18,545
|
507,130
|
John A. Graf
|
125,000
|
363,585
|
—
|
—
|
—
|
18,174
|
506,759
|
Gerri Losquadro
|
125,000
|
363,585
|
—
|
—
|
—
|
18,545
|
507,130
|
Roger M. Singer
|
125,000
|
363,585
|
—
|
—
|
—
|
28,545
|
517,130
|
Joseph V. Taranto
|
1,625,000
|
363,585
|
—
|
—
|
—
|
18,545
|
2,007,130
|
John A. Weber
|
125,000
|
363,585
|
—
|
—
|
—
|
28,545
|
517,130
|
(1) |
During 2018, all of the directors elected to receive their compensation in cash except for Mr. Amore, who received 541 shares in compensation for his services during
2018. Pursuant to his Chairmanship Agreement, Mr. Taranto received $1.5 million in addition to the standard annual retainer.
|
(2) |
The amount shown is the aggregate grant date fair value of the 2018 grant computed in accordance with Financial Accounting Standards Board Statement Accounting Standards
Codification Topic 718 (“FASB ASC Topic 718”) calculated by multiplying the number of shares by the fair market value (the average of the high and low of the Company’s stock price on the NYSE on the date of grant) (“FMV”). Each of the
Non-Employee Directors was awarded 1,500 restricted shares on February 21, 2018 at FMV of $242.39. The aggregate number of restricted stock outstanding at year-end 2018 was 3,499 for all directors, except for John A. Graf who had 3,176
shares.
|
(3) |
As of December 31, 2018, Mr. Amore has outstanding options to purchase 454 shares all of which are exercisable. This grant was awarded upon his appointment to the Board
on September 19, 2012.
|
(4) |
Dividends paid on each director’s restricted shares. For Messrs. Singer and Weber, also includes $10,000 in director fees for meetings attended as directors of both
Bermuda Re and International Re.
|
· |
Gross written premiums grew by 18% to $8.5 billion.
|
· |
The Company earned $191 million in after-tax operating income2 representing a 2.3% after tax operating return on equity (“ROE”)3.
|
· |
The Company returned $291 million in capital to shareholders during 2018 as follows:
|
· |
We paid quarterly dividends totaling $216 million in 2018. We also increased our quarterly dividend by 8% in the fourth quarter.
|
· |
We returned $75 million to shareholders by repurchasing 342,179 shares of our common stock under our previously announced stock repurchase plan.
|
Everest Re total return* over S&P 500:
|
||||
2013-2018
|
2011-2018
|
2008-2018
|
2003-2018
|
IPO*-2018
|
6 points
|
66 points
|
13 points
|
33 points
|
807 points
|
· |
No separate change-in-control (“CIC”) agreement for the CEO
|
· |
CEO and all participants in the CIC Plan are subject to double-trigger provisions
|
· |
No “gross-up” payments by the Company of any “golden parachute” excise taxes upon a change-in-control
|
· |
No accelerated equity vesting in CEO’s employment agreement, except in the limited circumstance of a change-in-control followed by a termination (i.e. double trigger)
|
· |
Incentive cash bonuses for all Named Executive Officers tied to specific Company financial performance metrics
|
· |
For 2018, approximately 44.1% of Named Executive Officers’ long-term incentive compensation is in the form of performance share units that can only be earned upon
satisfaction of specific Company financial performance metrics over a 3 year period
|
· |
Say on Pay Advisory Vote considered by shareholders annually
|
· |
Stock ownership and retention guidelines for executive vice presidents and above
|
THE COMPANY’S COMPENSATION PHILOSOPHY
AND OBJECTIVES
|
· |
Compensation of executive officers is based on the level of job responsibility, contribution to the performance of the Company, individual performance in light of
general economic and industry conditions, teamwork, resourcefulness and ability to manage our business.
|
· |
Compensation awards and levels are intended to be reasonably competitive with compensation paid by organizations of similar stature to both motivate the Company’s key
employees and minimize the potential for disruptive and costly key employee turnover.
|
· |
Compensation is intended to align the interests of the executive officers with those of the Company’s shareholders by basing a significant part of total compensation on
our executives’ contributions over time to the generation of shareholder value.
|
COMPONENT
|
FORM
|
KEY FEATURES
|
||
Base Salary
|
Cash
|
· |
Intended to attract and retain top talent
|
|
· |
Generally positioned near the median of our pay level peer group, but varies with individual skills, experience, responsibilities and
performance
|
|||
· |
Represents approximately 19% of CEO’s total compensation for 2018
|
|||
Non-Equity Incentive Compensation
|
Cash
|
· |
For 2018, the maximum potential bonus was tied to the Company Adjusted ROE. Final awards also consider achievement of individual
non-financial goals
|
|
· |
All Named Executive Officers (“NEOs”) were selected as participants in the Executive Performance Annual Incentive Plan (“Executive
Incentive Plan”) for 2018 with the maximum bonus potential available for award to any participant in the Plan not to exceed $3.5 million
|
COMPONENT
|
FORM
|
KEY FEATURES
|
||
Non-Equity Incentive
|
Cash
|
· |
Performance goals established at the beginning of each fiscal year
|
|
Compensation (continued) | · |
No guaranteed minimum award
|
||
· |
Intended to motivate annual performance with respect to key financial
measures, coupled with individual performance factors
|
|||
· |
Represents approximately 20% of CEO’s total compensation for 2018
|
|||
Performance Share Units
|
Equity
|
· |
Tied to the rate of annual operating ROE and cumulative growth in book value per share relative to our peer group over a three-year
period
|
|
· |
Payouts range from 0% of target payout to 175% of target payout, depending
on performance after 3 years
|
|||
· |
Intended to motivate long-term performance with respect to key financial measures and align our NEOs’ interests with those of our
shareholders
|
|||
· |
Represents approximately 30.5% of CEO’s total compensation for 2018
|
|||
Restricted Shares
|
Equity
|
· |
Vests at the rate of 20% per year after anniversary of grant over a five year period
|
|
· |
Intended to motivate long-term performance, promote appropriate
risk-taking, align our NEOs’ interests with shareholders’ interests and promote retention
|
|||
· |
Represents approximately 30.5% of CEO’s total compensation for 2018
|
|||
Alleghany Corporation
|
Arch Capital Group, Ltd.
|
Aspen Insurance Holdings, Limited
|
AXIS Capital Holdings, Limited
|
Chubb Limited
|
Markel Corporation
|
RenaissanceRe Holdings Ltd
|
Validus Holdings, Ltd.4
|
W.R. Berkley Corporation
|
XL Group, plc5
|
||
2018 INCENTIVE-BASED BONUS TARGETS AND AWARDS
|
|||||||||||||
Named Executive Officer
|
Target
Incentive Bonus (% Base Salary) |
Target
Incentive Bonus |
Potential
Maximum Incentive Bonus |
Actual
Bonus Award |
|||||||||
Dominic J. Addesso
(CEO) |
125%
|
$
|
1,562,500
|
$
|
3,500,000
|
$
|
1,300,000
|
||||||
John P. Doucette
President and CEO of the Reinsurance Division |
100%
|
$
|
850,000
|
$
|
1,700,000
|
$
|
400,000
|
||||||
Craig W. Howie
(CFO) |
100%
|
$
|
560,000
|
$
|
1,120,000
|
$
|
250,000
|
||||||
Sanjoy Mukherjee
GC and CEO of Bermuda Re |
100%
|
$
|
575,000
|
$
|
1,150,000
|
$
|
400,000
|
||||||
Jonathan M. Zaffino
President and CEO of the Everest Insurance® Division |
100%
|
$
|
600,000
|
$
|
1,200,000
|
$
|
550,000
|
||||||
TOTAL
|
$
|
4,147,500
|
$
|
8,670,000
|
$
|
2,900,000
|
NAMED EXECUTIVE OFFICERS
|
|||||
Target Award
|
Dominic Addesso
|
John Doucette
|
Craig Howie
|
Sanjoy Mukherjee
|
Jonathan Zaffino
|
2016 PSU
|
6,455
|
1,485
|
1,140
|
1,080
|
970
|
2017 PSU
|
6,410
|
1,285
|
930
|
880
|
855
|
2018 PSU
|
6,190
|
1,825
|
925
|
1,140
|
995
|
2016 PSU TARGET MEASURES
|
|||||||
Award Multiplier
|
|||||||
Weight
|
Performance
Year |
Target
ROE |
0%
|
25%
|
100%
|
175%
|
|
Operating ROE
|
50.0%
|
||||||
2016
|
10.5%
|
<3.5%
|
3.5%
|
10.5%
|
>=16.5%
|
||
2017
|
10%
|
<3%
|
3%
|
10%
|
>=15%
|
||
2018
|
11%
|
<4%
|
4%
|
11%
|
>=16%
|
||
Award Multiplier
|
|||||||
Weight
|
Performance
Period |
Target
|
0.0%
|
25%
|
100%
|
175%
|
|
3Yr Relative Change in BVPS to Peers
|
50.0%
|
2016 - 2018
|
Median
|
<26th %tile
|
26th %tile
|
Median
|
>=75th %tile
|
2017 PSU TARGET MEASURES
|
|||||||
Award Multiplier
|
|||||||
Weight
|
Performance
Year |
Target
ROE |
0%
|
25%
|
100%
|
175%
|
|
Operating ROE
|
50.0%
|
||||||
2017
|
10%
|
<3%
|
3%
|
10%
|
>=15%
|
||
2018
|
11%
|
<4%
|
4%
|
11%
|
>=16%
|
||
Award Multiplier
|
|||||||
Weight
|
Performance
Period |
Target
|
0.0%
|
25%
|
100%
|
175%
|
|
3Yr Relative Change in
BVPS to Peers
|
50.0%
|
2017 - 2019
|
Median
|
<26th %tile
|
26th %tile
|
Median
|
>=75th %tile
|
2018 PSU TARGET MEASURES
|
|||||||
Award Multiplier
|
|||||||
Weight
|
Performance
Year |
Target
ROE |
0%
|
25%
|
100%
|
175%
|
|
Operating ROE
|
50.0%
|
||||||
2018
|
11%
|
<4%
|
4%
|
11%
|
>=16%
|
||
Award Multiplier
|
|||||||
Weight
|
Performance
Period |
Target
|
0.0%
|
25%
|
100%
|
175%
|
|
3Yr Relative Change in
BVPS to Peers
|
50.0%
|
2018 - 2020
|
Median
|
<26th %tile
|
26th %tile
|
Median
|
>=75th %tile
|
OPERATING ROE
|
Dominic
Addesso |
John
Doucette |
Craig
Howie |
Sanjoy
Mukherjee |
Jonathan
Zaffino |
||||
Target Award
|
Target Award
|
Target Award
|
Target Award
|
Target Award
|
|||||
6,455
|
1,485
|
1,140
|
1,080
|
970
|
|||||
Target
|
Actual6
|
Earn
Out % |
Target
Multiplier |
Earned PSU
|
Earned PSU
|
Earned PSU
|
Earned PSU
|
Earned PSU
|
|
2016 Period
|
10.5%
|
12.8%
|
16.7%
|
128.8%
|
1,389
|
320
|
246
|
233
|
209
|
2017 Period
|
10%
|
4.6%
|
16.7%
|
42.1%
|
454
|
105
|
81
|
77
|
69
|
2018 Period
|
11%
|
2.3%
|
16.7%
|
0%
|
0
|
0
|
0
|
0
|
0
|
OPERATING ROE
|
Dominic
Addesso |
John
Doucette |
Craig
Howie |
Sanjoy
Mukherjee |
Jonathan
Zaffino |
||||
Target Award
|
Target Award
|
Target Award
|
Target Award
|
Target Award
|
|||||
6,410
|
1,285
|
930
|
880
|
855
|
|||||
Target
|
Actual7
|
Earn
Out % |
Target
Multiplier |
Earned PSU
|
Earned PSU
|
Earned PSU
|
Earned PSU
|
Earned PSU
|
|
2017 Period
|
10%
|
4.6%
|
16.7%
|
42.1%
|
451
|
91
|
66
|
62
|
61
|
2018 Period
|
11%
|
2.3%
|
16.7%
|
0%
|
0
|
0
|
0
|
0
|
0
|
OPERATING ROE
|
Dominic
Addesso |
John
Doucette |
Craig
Howie |
Sanjoy
Mukherjee |
Jonathan
Zaffino |
||||
Target Award
|
Target Award
|
Target Award
|
Target Award
|
Target Award
|
|||||
6,190
|
1,825
|
925
|
1,140
|
995
|
|||||
Target
|
Actual
|
Earn
Out % |
Target
Multiplier |
Earned PSU
|
Earned PSU
|
Earned PSU
|
Earned PSU
|
Earned PSU
|
|
2018 Period
|
11%
|
2.3%
|
16.7%
|
0%
|
0
|
0
|
0
|
0
|
0
|
Alleghany Corporation
|
Arch Capital Group, Ltd.
|
Aspen Insurance Holdings, Limited
|
AXIS Capital Holdings, Limited
|
Chubb Limited
|
Markel Corporation
|
RenaissanceRe Holdings Ltd
|
Validus Holdings, Ltd.8
|
W.R. Berkley Corporation
|
XL Group, plc9
|
||
2016 PSU (BVPS)
|
Dominic
Addesso |
John
Doucette |
Craig
Howie |
Sanjoy
Mukherjee |
Jonathan
Zaffino |
||||
Target Award
|
Target Award
|
Target Award
|
Target Award
|
Target Award
|
|||||
6,455
|
1,485
|
1,140
|
1,080
|
970
|
|||||
Weight
|
Award
Multiplier |
Earned PSU
|
Earned PSU
|
Earned PSU
|
Earned PSU
|
Earned PSU
|
|||
2016-2018 Period
|
50.0%
|
139%
|
4,487
|
1,033
|
793
|
751
|
675
|
||
Dominic
Addesso |
John
Doucette |
Craig
Howie |
Sanjoy
Mukherjee |
Jonathan
Zaffino |
|
2016 PSU Target Award
|
6,455
|
1,485
|
1,140
|
1,080
|
970
|
Total 2016 Operating ROE PSU Earned
|
1,843
|
425
|
327
|
310
|
278
|
Total 2016 BVPS PSU Earned
|
4,487
|
1,033
|
793
|
751
|
675
|
Total PSU Earned
|
6,330
|
1,458
|
1,120
|
1,061
|
953
|
· |
investments in our business in the form of human capital and intellectual resources;
|
· |
reserving methodologies and reserve positions;
|
· |
diversification of risk within our insurance and reinsurance portfolios;
|
· |
capital management strategies;
|
· |
long-term strategic growth initiatives; and
|
· |
creativity in the development of new products.
|
· |
executive officer’s performance against individual goals;
|
· |
individual effort in achieving company goals;
|
· |
effectiveness in fostering and working within a team-oriented approach;
|
· |
creativity, demonstrated leadership traits and future potential;
|
· |
level of experience;
|
· |
areas of responsibility; and
|
· |
total compensation relative to the executive’s internal peers.
|
Name
|
Title/ Business Unit
|
Annual
Base Salary
|
Annual
Cash Bonus |
Annual
Time-Vested Equity Award |
Annual
Performance- Based Equity Award |
Total Direct
Compensation
|
||||||||||||
Dominic J. Addesso
|
CEO and President
|
$
|
1,250,000
|
$
|
1,300,000
|
$
|
2,000,000
|
$
|
2,000,000
|
$
|
6,550,000
|
|||||||
John P. Doucette
|
Executive Vice President and
President and CEO of the
Reinsurance Division
|
850,000
|
400,000
|
663,000
|
442,000
|
2,355,000
|
||||||||||||
Craig Howie
|
Executive Vice President and
Chief Financial Officer
|
560,000
|
250,000
|
448,000
|
224,000
|
1,482,000
|
||||||||||||
Sanjoy Mukherjee
|
Executive Vice President and
General Counsel, Secretary
and Managing Director and
CEO of Bermuda Re
|
575,000
|
400,000
|
432,000
|
288,000
|
1,695,000
|
||||||||||||
Jonathan Zaffino
|
Executive Vice President and
President and CEO of the
Everest Insurance® Division
|
600,000
|
550,000
|
560,300
|
279,700
|
1,990,000
|
||||||||||||
· |
the 2018 operating plan,
|
· |
the average operating return on equity achieved over several market cycles,
|
· |
the average operating return on equity among the Company peer group, and
|
· |
the fact that the Company operates in an increasingly competitive and challenging market cycle, highlighted by non-traditional capital providers and a historically low
interest rate environment.
|
Performance Level
|
Financial Performance Measure (ROE)
|
Potential Maximum Bonus
|
Maximum
|
>=16%
|
$3.5 million
|
Target
|
11%
|
125% of Base Salary
|
Threshold
|
4%
|
50% of Base Salary
|
Below Threshold
|
<4%
|
Zero
|
Performance Measure
|
2018
Plan ROE (Target) |
2018
Adjusted ROE |
Percentage of
Base Salary Maximum Bonus |
Resulting
Maximum Bonus Potential |
Operating ROE
|
11%
|
7.5%
|
70%
|
$ 765,625
|
Non-Financial Performance Measure
|
Maximum Bonus Potential
|
30% of 350% Base Salary Bonus Maximum
|
$ 1,312,500
|
Performance Measure
|
2018 Plan ROE
(Target) |
2018 Adjusted ROE
|
Resulting Maximum
Bonus Potential |
Operating ROE
|
11%
|
7.5%
|
$ 765,625
|
Non-Financial
|
$ 1,312,500
|
||
Total Potential Cash Bonus
|
$ 2,078,125
|
||
Accomplishments
|
Demonstrated leadership as CEO including active oversight of the Company’s day-to-day operations across all business segments
|
Oversaw continued expansion of the Company’s insurance operations executive team and diversification of business lines and
growth
|
Successfully managed the Company’s natural peril catastrophe exposure within the Board’s Risk Appetite Statement
|
Oversaw overall strategy to diversify risk portfolio and incorporate new products
|
Oversaw development and implementation of succession plan process at senior executive level for the Company and the Company’s
affiliates
|
Achieved annual budget objectives and oversaw coordination of all business units in putting together the 2018 operating plan
|
Continued to build relationships with the Company’s long-term shareholders
|
Maintained professional relationships with Company’s regulators and rating agencies
|
Oversaw continued modernization of Company’s information technology systems and improvements in underwriting analytics and
business processes
|
Oversaw investment portfolio and provided guidance on executing on an investment strategy that returned above benchmark yield
|
Performance Level
|
Financial
Performance Measure(ROE) |
Potential
Maximum Bonus |
JOHN
DOUCETTE |
CRAIG
HOWIE |
SANJOY
MUKHERJEE |
JONATHAN
ZAFFINO |
||||
Maximum
|
>=16%
|
200% Base Salary
|
$
|
1,700,000
|
$
|
1,120,000
|
$
|
1,150,000
|
$
|
1,200,000
|
Target
|
11%
|
100% Base Salary
|
$
|
850,000
|
$
|
560,000
|
$
|
575,000
|
$
|
600,000
|
Threshold
|
4%
|
25% Base Salary
|
$
|
212,500
|
$
|
140,000
|
$
|
143,750
|
$
|
150,000
|
Below Threshold
|
<4%
|
Zero
|
$
|
0
|
$
|
0
|
$
|
0
|
$
|
0
|
JOHN DOUCETTE
|
CRAIG HOWIE
|
SANJOY
MUKHERJEE |
JONATHAN
ZAFFINO |
|||
Financial
Performance Measure (ROE) |
2018
Plan ROE (Target) |
2018
Adjusted ROE |
Resulting
Maximum Bonus Potential |
Resulting
Maximum Bonus Potential |
Resulting
Maximum Bonus Potential |
Resulting
Maximum Bonus Potential |
70.0%
|
11%
|
7.5%
|
$371,875
|
$245,000
|
$251,563
|
$262,500
|
Non-Financial Performance Measure
|
JOHN DOUCETTE
|
CRAIG HOWIE
|
SANJOY MUKHERJEE
|
JONATHAN ZAFFINO
|
30% of 200% Base Salary Bonus Maximum
|
$510,000
|
$336,000
|
$345,000
|
$360,000
|
JOHN DOUCETTE
|
CRAIG HOWIE
|
SANJOY
MUKHERJEE |
JONATHAN
ZAFFINO |
|||
Performance
Measure |
2018
Plan ROE (Target) |
2018
Adjusted ROE |
Resulting
Maximum Bonus Potential |
Resulting
Maximum Bonus Potential |
Resulting
Maximum Bonus Potential |
Resulting
Maximum Bonus Potential |
Operating ROE
|
11%
|
7.5%
|
$371,875
|
$245,000
|
$251,563
|
$262,500
|
Non-Financial
|
$510,000
|
$336,000
|
$345,000
|
$360,000
|
||
Total Maximum Bonus
|
$881,875
|
$581,000
|
$596,563
|
$622,500
|
||
Accomplishments
|
Demonstrated leadership in leading the Company’s worldwide reinsurance underwriting and claim teams and
philosophies resulting in respectable reinsurance underwriting results for 2018 in the face of unprecedented catastrophe losses
|
Demonstrated leadership in identifying, developing and marketing new product opportunities and distribution
strategies resulting in increased underwriting margin
|
Continued strategic utilization of Mt. Logan Re to address competitive pressures of alternative reinsurance
capital markets in traditional reinsurance space
|
Managed aggressive renewal strategy post-2017 catastrophe losses resulting in reduced property lines with
improved expected margin for the 2018 property book
|
Proactive leadership in technology advances resulting in analytic and business process improvements
|
Accomplishments
|
Demonstrated leadership in overseeing and managing the Company’s Accounting and Financial reporting, Comptroller’s,
Tax, Actuarial and Treasury departments
|
Participate in analysis of M&A and new business opportunities
|
Demonstrated leadership on the reserving committee and his open and frank discussions with the Board regarding the
Company’s reserving practice
|
Provide leadership in investor relations
|
Managed the Company’s operating capital and advised the CEO and Board on share buyback opportunities
|
Active in Mt. Logan board leading to successful oversight and implementation of Mt. Logan operation improvements
|
Improved actuarial reserving processes
|
Successful interfacing with the Company’s ratings agencies and independent auditors
|
Accomplishments
|
Demonstrated leadership in serving two full time executive roles within the Company: CEO of Bermuda Re and the
Company’s General Counsel, Chief Compliance Officer and Secretary
|
Demonstrated leadership as General Counsel of the Group overseeing and managing the Company’s Law Department and
providing competent legal advice to the CEO, CFO and Board of Directors
|
Active in Mt. Logan board (as Chairman) leading to operational and strategic improvements
|
Participation in strategic direction of insurance operation expansion and successful identification and
satisfaction of legal and regulatory compliance requirements
|
Participation in development of strategic direction and overseeing successful execution of regulatory,
contractual and legal requirements for the Company’s Lloyd’s syndicate
|
Conducting considerable research, analysis and outreach with shareholders and proxy advisors resulting in Board
governance recommendations and improvements
|
Significant participation in creation of new legal entities within the Company consistent with expansion
objectives and aggressive timelines
|
Overseeing the Company’s worldwide disputes and litigations
|
Providing competent advice and counsel on alternative expansion strategies and identify most cost-efficient
corporate governance solutions to meet rapid product and business expansion goals
|
Overseeing legal aspects of enterprise risk management
|
Demonstrated leadership as CEO of Bermuda Re including active oversight of Bermuda Re’s property and casualty
risk portfolio and day-to-day operations
|
Provided underwriting leadership in restructuring the Bermuda Re property & casualty portfolio post-2017 catastrophe losses resulting in reduced property lines with improved margins and enhanced diversification across several lines of
business
|
Recruitment of underwriting, actuarial and financial support teams with diverse skillsets, and expanded
succession planning and leadership depth within Bermuda Re
|
Accomplishments
|
Demonstrated leadership in overseeing and managing the expansion of the Company’s North America insurance
operations
|
Development of insurance underwriting guidelines for new products
|
Oversaw significant enhancements to insurance operation platform
|
Effective leadership in identifying, developing and marketing new product opportunities and distribution
strategies
|
Participates in evaluation of M&A opportunities
|
Improved the financial performance of the insurance operations
|
Implemented new product offerings and diversified the product mix
|
Recruitment of strong additions to the North America insurance leadership team
|
Developing strategic alliances with key clients and insurtech partners to enhance operational, distribution and
system efficiencies across product lines
|
COMPENSATION OF EXECUTIVE OFFICERS
|
Change in Pension
|
|||||||||||||||||
Value and
|
|||||||||||||||||
Stock Awards
|
Nonqualified
|
||||||||||||||||
Name and
|
Restricted
|
Performance
|
Non-Equity
|
Deferred
|
|||||||||||||
Principal
|
Stock
|
Share Unit
|
Incentive Plan
|
Compensation
|
All Other
|
||||||||||||
Position
|
Year
|
Salary
|
Bonus
|
Awards(1)
|
Awards(2)
|
Compensation
|
Earnings(3)
|
Compensation(4)
|
Total
|
||||||||
Dominic J. Addesso
|
|||||||||||||||||
CEO and President
|
|||||||||||||||||
2018
|
$
|
1,182,692
|
$ —
|
$
|
2,500,253
|
$
|
1,500,394
|
$
|
1,300,000
|
$
|
151,075
|
$
|
432,321
|
$
|
7,066,735
|
||
2017
|
1,000,000
|
—
|
2,500,611
|
1,500,132
|
1,800,000
|
1,811,771
|
216,708
|
8,829,222
|
|||||||||
|
2016
|
1,000,000
|
—
|
2,400,524
|
1,200,727
|
2,500,000
|
1,500,330
|
226,096
|
8,827,677
|
||||||||
John P. Doucette
|
|||||||||||||||||
Executive Vice President and President and CEO of Reinsurance
Division
|
|||||||||||||||||
2018
|
$
|
823,077
|
$ —
|
$
|
664,149
|
$
|
442,362
|
$
|
400,000
|
$
|
(78,346)
|
$
|
169,933
|
$
|
2,421,175
|
||
2017
|
733,846
|
—
|
600,287
|
300,729
|
850,000
|
732,728
|
72,552
|
3,290,142
|
|||||||||
|
2016
|
686,538
|
—
|
552,465
|
276,232
|
1,050,000
|
505,025
|
80,518
|
3,150,778
|
||||||||
Craig Howie(5)
|
|||||||||||||||||
Executive Vice President and Chief Financial Officer
|
|||||||||||||||||
2018
|
$
|
555,154
|
$ —
|
$
|
448,422
|
$
|
224,211
|
$
|
250,000
|
$
|
—
|
$
|
128,738
|
$
|
1,606,525
|
||
2017
|
538,769
|
—
|
434,126
|
217,648
|
550,000
|
—
|
144,076
|
1,884,619
|
|||||||||
|
2016
|
526,539
|
—
|
425,044
|
212,057
|
725,000
|
—
|
152,070
|
2,040,710
|
||||||||
Sanjoy Mukherjee(4)
|
|||||||||||||||||
Executive Vice President, General Counsel and Secretary
|
|||||||||||||||||
2018
|
$
|
558,038
|
$ —
|
$
|
414,487
|
$
|
276,325
|
$
|
400,000
|
$
|
(67,805)
|
$
|
252,153
|
$
|
1,833,198
|
||
2017
|
508,769
|
—
|
410,723
|
205,946
|
550,000
|
891,980
|
199,209
|
2,766,627
|
|||||||||
|
2016
|
493,077
|
—
|
400,862
|
200,896
|
725,000
|
602,803
|
167,551
|
2,590,189
|
||||||||
Jonathan Zaffino(5)
|
|||||||||||||||||
Executive Vice President and President and CEO of Everest Insurance®
|
|||||||||||||||||
2018
|
$
|
573,077
|
$ —
|
$
|
481,144
|
$
|
241,178
|
$
|
550,000
|
$
|
—
|
$
|
110,003
|
$
|
1,955,402
|
||
2017
|
490,577
|
—
|
630,711
|
200,096
|
400,000
|
—
|
92,811
|
1,814,195
|
|||||||||
|
2016
|
461,539
|
—
|
380,401
|
180,435
|
500,000
|
—
|
76,760
|
1,599,135
|
||||||||
(1) |
The amounts are the aggregate grant date fair value for restricted awards granted during 2018 computed in accordance with FASB ASC Topic 718. Restricted shares
vest at the rate of 20% per year over five years.
|
(2) |
The amounts are the aggregate grant date fair value for performance share unit awards granted during 2018 computed in accordance with FASB ASC Topic 718, at the
target achievement percentage (100%). The performance achievement factor can range between 0% and 175% of the target grant. If the participants achieved the maximum performance achievement factor, the value of the performance share unit
grants would be follows: Mr. Addesso $2,625,690; Mr. Doucette $774,133; Mr. Howie $392,369; Mr. Mukherjee $483,568 and Mr. Zaffino $422,062.
|
(3) |
Represents the aggregate change in the present value of the officers’ accumulated benefit under the qualified and supplemental pension plans from December 31,
2017 to December 31, 2018. Earnings on the Supplemental Savings Plan are not included as they are invested in the same investment offerings as the qualified savings plan and are not preferential.
|
(4) |
The amount reported for 2018 for Mr. Mukherjee, who is a citizen of the United States, includes $140,000 as a Bermuda residence housing allowance. The Company
owns a car which is provided for Mr. Mukherjee’s use in Bermuda at a cost of $2,749 in insurance and license fees.
|
Addesso
|
Doucette
|
Howie
|
Mukherjee
|
Zaffino
|
||||||||||||
Life insurance premiums
|
$
|
1,080
|
$
|
1,080
|
$
|
1,080
|
$
|
1,080
|
$
|
1,080
|
||||||
Employer Matching Contributions
(Qualified and Non-qualified) |
35,481
|
24,692
|
16,650
|
16,212
|
16,500
|
|||||||||||
Dividends on Restricted Shares
|
179,145
|
46,296
|
33,432
|
33,799
|
34,038
|
|||||||||||
Employer Discretionary Contribution(5)
|
216,615
|
97,865
|
77,576
|
58,313
|
58,385
|
|||||||||||
(5) |
Mr. Howie and Mr. Zaffino are not eligible for the Retirement Plan or Supplemental Retirement Plan and therefore receive an Employer Discretionary
Contribution and an additional qualified plan contribution pursuant to the revision of the Company’s Savings Plan that is applicable to those employees hired after April 1, 2010.
|
Estimated Future
|
Estimated Future
|
All Other
Stock |
|||||||||||||||||
Payouts Under
Non-Equity Incentive Plan Awards(1) |
Payouts Under
Equity Incentive Plan Awards |
Awards:
Number |
Grant Date Fair Value of
Stock Awards |
||||||||||||||||
Name
|
|
Grant Date
|
|
Threshold
|
|
Target
|
|
Maximum
|
|
Threshold
|
|
Target(4)
|
|
Maximum(5)
|
|
of Shares
of Stock or Units(2) |
|
Restricted
Stock Awards(3) |
PSU
Awards(6) |
Dominic J.
Addesso
|
2/21/2018
|
—
|
$1,562,500
|
$3,500,000
|
—
|
6,190
|
10,833
|
10,315
|
$2,500,253
|
$1,500,394
|
|||||||||
John P.
Doucette
|
2/21/2018
|
—
|
850,000
|
1,700,000
|
—
|
1,825
|
3,194
|
2,740
|
664,149
|
442,362
|
|||||||||
Craig Howie
|
2/21/2018
|
—
|
560,000
|
1,120,000
|
—
|
925
|
1,619
|
1,850
|
448,422
|
224,211
|
|||||||||
Sanjoy
Mukherjee
|
2/21/2018
|
—
|
575,000
|
1,150,000
|
—
|
1,140
|
1,995
|
1,710
|
414,487
|
276,325
|
|||||||||
Jonathan
Zaffino
|
2/21/2018
|
—
|
600,000
|
1,200,000
|
—
|
995
|
1,741
|
1,985
|
481,144
|
241,178
|
|||||||||
(1) |
Potential awards to be made pursuant to the Executive Performance Annual Incentive Plan. The actual award is shown in the
“Non-Equity Incentive Plan Compensation” column of the Summary Compensation Plan table.
|
(2) |
This column shows the number of restricted shares granted in 2018 to the Named Executive Officers pursuant to the 2010 Stock
Incentive Plan. Restricted shares vest at the rate of 20% per year over five years. During the restricted period, quarterly dividends are paid to the Named Executive Officer.
|
(3) |
The grant date fair value of each equity award calculated in accordance with FASB ASC Topic 718.
|
(4) |
This column shows the number of performance share units outstanding at December 31, 2018 for each Named Executive Officers pursuant
to the 2010 Stock Incentive Plan, assuming achievement at the target level (100%). Performance share units vest 100% after three years.
|
(5) |
This column shows the number of performance share units outstanding at December 31, 2018 for each Named Executive Officers pursuant
to the 2010 Stock Incentive Plan, assuming achievement at the maximum level (175%). Performance share units vest 100% after three years.
|
(6) |
The grant date fair value of each equity award calculated in accordance with FASB ASC 718.
|
Stock Awards(1)
|
|||||||
Restricted Stock Awards
|
PSU Awards
|
||||||
Number of Shares or
Units of Stock That
Have Not Vested(1)
|
Market Value of
Shares or Units of
Stock That Have
Not Vested(2)
|
Equity Incentive
Plan Awards: Number of Unearned Shares, Units or Other
Rights That Have Not
Vested(3)
|
Equity Incentive
Plan Awards: Market or Payout Value of Unearned Shares,
Units or Other Rights That Have Not Vested(2)
|
||||
Name
|
|
|
|
||||
Dominic J. Addesso
|
33,801
|
$ 7,360,506
|
9,433
|
$ 2,054,130
|
|||
John P. Doucette
|
8,735
|
1,902,134
|
2,378
|
517,833
|
|||
Craig Howie
|
6,308
|
1,373,630
|
1,391
|
302,904
|
|||
Sanjoy Mukherjee
|
5,862
|
1,276,509
|
1,537
|
334,697
|
|||
Jonathan Zaffino
|
6,275
|
1,366,444
|
1,400
|
304,864
|
|||
(1) |
Restricted shares vest at the rate of 20% annually over a five year period. Grant dates for the restricted shares are in the table
that follows.
|
(2) |
Determined by multiplying the NYSE December 31, 2018 closing price of $217.76 by the number of outstanding share or performance
share unit awards.
|
(3) |
PSU awards vest over a three year performance period. Actual number of PSU earned may be up to 175% of the number listed in the
tables above and below.
|
Grant Date
|
2/26/2014
|
2/25/2015
|
2/24/2016
|
2/22/2017
|
9/6/2017
|
2/21/2018
|
Dominic J. Addesso
|
||||||
Restricted Share Awards
|
2,721
|
4,474
|
7,743
|
8,548
|
—
|
10,315
|
PSU Awards
|
6,455
|
6,410
|
—
|
6,190
|
||
John P. Doucette
|
||||||
Restricted Share Awards
|
953
|
1,208
|
1,782
|
2,052
|
—
|
2,740
|
PSU Awards
|
1,485
|
1,285
|
—
|
1,825
|
||
Craig Howie
|
||||||
Restricted Share Awards
|
681
|
922
|
1,371
|
1,484
|
—
|
1,850
|
PSU Awards
|
1,140
|
930
|
—
|
925
|
||
Sanjoy Mukherjee
|
||||||
Restricted Share Awards
|
613
|
842
|
1,293
|
1,404
|
—
|
1,710
|
PSU Awards
|
1,080
|
880
|
—
|
1,140
|
||
Jonathan Zaffino
|
||||||
Restricted Share Awards
|
—
|
895
|
1,227
|
1,368
|
800
|
1,985
|
PSU Awards
|
970
|
855
|
—
|
995
|
||
Share Awards
|
||||
Number of Shares
|
||||
Acquired on
|
Value Realized
|
|||
Name
|
Vesting
|
on Vesting(1)
|
||
Dominic J. Addesso
|
12,176
|
$ 2,946,495
|
||
John P. Doucette
|
3,830
|
927,260
|
||
Craig Howie
|
2,794
|
676,417
|
||
Sanjoy Mukherjee
|
3,182
|
749,963
|
||
Jonathan Zaffino
|
1,399
|
333,924
|
||
(1) |
Amount reflects the aggregate market share value on the day that the restricted shares vest.
|
Number of
|
Present Value
|
Payments
|
||
Years Credited
|
of Accumulated
|
During
|
||
Name
|
Plan Name
|
Service
|
Benefit(1)
|
Last Fiscal Year
|
Dominic J. Addesso
|
Retirement Plan
|
9.7
|
$ 702,944
|
$ —
|
Supplemental Plan
|
5,957,380
|
—
|
||
John P. Doucette
|
Retirement Plan
|
10.3
|
448,920
|
—
|
Supplemental Plan
|
1,985,378
|
—
|
||
Craig Howie
|
Retirement Plan
|
N/A
|
—
|
—
|
Supplemental Plan
|
—
|
—
|
||
Sanjoy Mukherjee
|
Retirement Plan
|
18.5
|
835,922
|
—
|
Supplemental Plan
|
2,602,605
|
—
|
||
Jonathan Zaffino
|
Retirement Plan
|
N/A
|
—
|
—
|
Supplemental Plan
|
—
|
—
|
||
(1) |
The table employs the discount rate of 4.27% at December 31, 2018 and 3.62% at December 31, 2017 for the Retirement Plan and
pre-retirement Supplemental Plan. Post retirement, the Supplemental Plan discount rate is 5% for both years. The Mortality Table used for 12/31/2018 is the Sex distinct RP-2014 White Collar Table adjusted to 2006 with Scale MP-2018 for
the Qualified Plan projected to executive’s assumed retirement age. Updated Table 417(e) Mortality is used for the Supplemental Plan post-retirement projected to executive’s assumed retirement age. For 12/31/2017, the Mortality Table used
is the Sex distinct RP-2014 White Collar Table adjusted to 2006 with Scale MP-2017 for the Qualified Plan projected to executive’s assumed retirement age. Updated 417(e) Mortality is used for the Supplemental Plan for Post-Retirement
projected to executive’s assumed retirement age. The payment form assumes 50% Joint and Survivor for the Retirement Plan (wives assumed to be 4 years younger than their husbands), single life annuity for the Supplemental Plan at earliest
unreduced retirement age.
The Assumptions for the 2018 calculations related to Retirement Plan and the pre-retirement Supplemental
Plans are the same as those used in the FAS ASC 715 disclosure report for year ending December 31, 2018.
The information above has been developed assuming that the participants will retire at the earliest age at
which they would receive an unreduced benefit. Mr. Addesso is past normal retirement age and is currently eligible for unreduced benefits. Mr. Doucette is not eligible to retire with unreduced benefits until age 65. Mr. Mukherjee is
eligible to receive an unreduced benefit under the Retirement Plan at age 63 and 10 months and at age 60 under the Supplemental Retirement Plan. The number of years of credited service in the Retirement Plan is greater than in the
Supplemental Plan as accruals in the Supplemental Plan were frozen effective December 31, 2017.
|
Executive
|
Registrant
|
Aggregate
|
Aggregate
|
Aggregate
|
|
Contributions in
|
Contributions in
|
Earnings in
|
Withdrawal/
|
Balance at Last
|
|
Name
|
Last Fiscal Year(2)
|
Last Fiscal Year(2)
|
Last Fiscal Year
|
Distributions
|
Fiscal Year-End(3)
|
Dominic J. Addesso
|
|||||
Everest Re Supplemental
|
|||||
Savings Plan
|
$ 27,404
|
$ 244,019
|
$ (52,600)
|
$ —
|
$ 646,812
|
John P. Doucette
|
|||||
Everest Re Supplemental
|
|||||
Savings Plan
|
16,673
|
114,538
|
(54,716)
|
—
|
364,857
|
Craig Howie
|
|||||
Everest Re Supplemental
|
|||||
Savings Plan
|
8,400
|
66,726
|
(59,181)
|
—
|
518,647
|
Sanjoy Mukherjee
|
|||||
Everest Re Supplemental
|
|||||
Savings Plan
|
7,962
|
66,274
|
(15,569)
|
—
|
196,934
|
Jonathan Zaffino
|
|||||
Everest Re Supplemental
|
|||||
Savings Plan
|
9,000
|
50,885
|
(14,916)
|
—
|
175,108
|
(1) |
The Supplemental Savings Plan has the same investment elections as the Company’s 401(k) plan and is designed to allow each
participant to contribute a percentage of his base salary and receive a company match beyond the contribution limits prescribed by the Code with regard to 401(k) plans. When the annual IRS 401(a) (17) compensation maximum is reached under
the qualified savings plan, eligible employees may contribute to the Supplemental Savings Plan which allows for up to a 3% employee contribution and a 3% company match. Withdrawal is permitted only upon cessation of employment.
|
(2) |
All of the amounts reported in this column are included in the 2018 Summary Compensation Table. As employees hired after April 1,
2010, Messrs. Howie and Zaffino receive a higher Company contribution under the Supplemental Savings Plan.
|
(3) |
The amounts reported in this column represent balances from the Everest Re Supplemental Savings Plan and include various amounts
previously reported in the Summary Compensation Table as Salary, Bonus or All Other Compensation.
|
CEO PAY RATIO DISCLOSURE |
Fiscal Year
|
2018
|
2018
|
|||
Employee
|
Median Employee
|
CEO
|
|||
Annual Base Salary
|
$
|
123,600
|
$
|
1,250,000
|
|
Bonus Paid
March 2019 |
$
|
10,500
|
$
|
1,300,000
|
|
Res Share Value Granted
Feb. 2018 |
$
|
0
|
$
|
2,500,000
|
|
Perf Share Target Value Granted
Feb. 2018 |
$
|
0
|
$
|
1,500,000
|
|
Pension Value and Nonqualified Deferred Comp Earnings
PY 2018 |
$
|
0
|
$
|
151,075
|
|
All Other Compensation
PY 2018 |
$
|
6,539
|
$
|
432,321
|
|
Total Comp
|
$
|
140,639
|
$
|
7,133,396
|
|
· |
Date selected to determine employee population for purposes of identifying the median employee– December 1, 2018.
|
· |
Median employee identified using Total Compensation, which includes base salary, bonus, and stock awards (if any).
|
· |
Employees from all Everest locations included in calculation to identify median.
|
· |
Salaries, bonuses and stock for Non-US employees converted to USD (12/1/2018 conversion rates).
|
· |
Salaries for part-time employees annualized to a full-time equivalent.
|
· |
Annual salary, bonus and stock target amounts were included for mid-year hired employees who were not otherwise eligible to
participate in the full 2018 annual compensation review process.
|
· |
“All Other Compensation” includes life insurance premiums, employer matching contributions (qualified and non-qualified),
dividends on restricted shares and employer discretionary contributions.
|
EMPLOYMENT, CHANGE OF CONTROL AND OTHER AGREEMENT
|
Name
|
PSU
|
Restricted Shares
|
Total
|
Dominic J. Addesso
|
$ 3,529,999
|
$ 7,360,506
|
$ 10,890,505
|
John P. Doucette
|
854,476
|
1,902,134
|
2,756,610
|
Craig W. Howie
|
560,699
|
1,373,630
|
1,934,329
|
Sanjoy Mukherjee
|
578,927
|
1,276,509
|
1,855,436
|
Jonathan Zaffino
|
524,985
|
1,366,444
|
1,891,429
|
Termination Without
|
Termination
|
||||||
Cause or Resignation
|
Following
|
||||||
Name
|
Incremental Benefit
|
for Good Reason
|
Change in Control
|
||||
Dominic J. Addesso
|
Cash Payment
|
$
|
3,800,000
|
(1)
|
$
|
8,652,243
|
(5)
|
Restricted Stock Value
|
4,520,044
|
(2)
|
7,360,506
|
(6)
|
|||
PSU Value
|
3,529,999
|
(3)
|
3,529,999
|
(7)
|
|||
Benefits Continuation
|
44,834
|
(4)
|
25,000
|
||||
Pension Enhancement
|
—
|
—
|
|||||
Total Value
|
$
|
11,894,877
|
$
|
19,567,748
|
(8)
|
||
John P. Doucette
|
Cash Payment
|
$
|
2,100,000
|
(1)
|
$
|
3,528,974
|
(5)
|
Restricted Stock Value
|
699,445
|
(2)
|
1,902,134
|
(6)
|
|||
PSU Value
|
854,476
|
(3)
|
854,476
|
(7)
|
|||
Benefits Continuation
|
32,520
|
(4)
|
34,000
|
||||
Pension Enhancement
|
—
|
566,000
|
|||||
Total Value
|
$
|
3,686,441
|
$
|
6,885,584
|
(8)
|
||
Craig Howie
|
Cash Payment
|
$
|
1,370,000
|
(1)
|
$
|
2,436,974
|
(5)
|
Restricted Stock Value
|
509,558
|
(2)
|
1,373,630
|
(6)
|
|||
PSU Value
|
560,699
|
(3)
|
560,699
|
(7)
|
|||
Benefits Continuation
|
32,520
|
(4)
|
34,000
|
||||
Saving Plan Enhancement
|
—
|
372,000
|
|||||
Total Value
|
$
|
2,472,777
|
$
|
4,777,303
|
(8)
|
||
Sanjoy Mukherjee
|
Cash Payment
|
$
|
1,550,000
|
(1)
|
$
|
2,356,591
|
(5)
|
Restricted Stock Value
|
469,926
|
(2)
|
1,276,509
|
(6)
|
|||
PSU Value
|
578,927
|
(3)
|
578,927
|
(7)
|
|||
Benefits Continuation
|
22,433
|
(4)
|
23,000
|
||||
Pension Enhancement
|
—
|
382,000
|
|||||
Total Value
|
$
|
2,621,286
|
$
|
4,617,027
|
(8)
|
Termination Without
|
Termination
|
||||||
Cause or Resignation
|
Following
|
||||||
Name
|
Incremental Benefit
|
for Good Reason
|
Change in Control
|
||||
Jonathan Zaffino
|
Cash Payment
|
$
|
1,750,000
|
(1)
|
$
|
1,916,795
|
(5)
|
Restricted Stock Value
|
390,879
|
(2)
|
1,366,444
|
(6)
|
|||
PSU Value
|
524,985
|
(3)
|
524,985
|
(7)
|
|||
Benefits Continuation
|
35,635
|
(4)
|
35,000
|
||||
Saving Plan Enhancement
|
—
|
232,000
|
|||||
Total Value
|
$
|
2,701,499
|
$
|
4,075,224
|
(8)
|
||
(1) |
Pursuant to the terms of the Mr. Addesso’s employment agreement, he would be paid a separation allowance in equal installments over
a 24 month period equal to two times his base salary. Messrs. Doucette, Mukherjee, Howie and Zaffino would each be paid two times his base salary over a 12 month period. All would receive any annual incentive bonus earned but not yet paid
for the completed full fiscal year prior to termination.
|
(2) |
Pursuant to the terms of the Named Executive Officer’s employment agreement, unvested restricted stock will continue to vest in
accordance with its terms in the 12 month period following termination for Messrs. Doucette, Mukherjee, Howie and Zaffino, For Mr. Addesso, unvested stock would continue to vest for 24 months in accordance with its terms.
|
(3) |
Under the terms of their respective employment agreements, Messrs. Addesso, Howie, Doucette, Mukherjee and Zaffino would receive
the PSU installments pursuant to achieved performance goals. The remaining PSU installments will vest pursuant to the Performance Stock Unit Award Agreement terms and are valued at the target performance (100%) for purpose of this table.
|
(4) |
Pursuant to the terms of the Named Executive Officer’s employment agreement, he shall continue to participate in the disability and
life insurance programs until the earlier of a certain number of months or his eligibility to be covered by comparable benefits of a subsequent employer and he will receive a cash payment to enable him to pay for medical and dental
coverage for a certain number of months. For Mr. Addesso, the number is 24 months, for Messrs. Doucette, Howie, Mukherjee, and Zaffino, it is 12 months.
|
(5) |
The Senior Executive Change of Control Agreement provides for a cash payment that equals the average of the executive’s salary and
bonus for the previous three years times a factor assigned by the Board. The factor is 2.0 for Messrs. Doucette, Howie, Mukherjee and Zaffino and 2.5 for Mr. Addesso.
|
(6) |
The unvested equity awards for each Named Executive Officer are valued at the NYSE closing price of $217.76 at 2018 year end as if
all vested on December 31, 2018.
|
(7) |
In the event of a Change in Control, the Company may elect to continue the Performance Stock Awards subject to the 2010 Stock
Incentive Plan and Performance Stock Unit Award Agreement. According to the award agreement, completed installments are valued according to the actual achievement factor, and the remaining installments are valued at the target performance
(100%).
|
(8)
|
The Senior Executive Change of Control Plan includes a “Best Net” provision regarding the determination and treatment of parachute
payments that could potentially result in a reduced figure based on each participant’s relevant circumstances as calculated by an accounting firm agreed to by the participant and the Company. Under the provision, in lieu of an automatic
reduction in benefits in the event of an excess parachute payment that triggers the excise tax, benefits are reduced to avoid an excess parachute payment only if doing so results in a higher after-tax benefit to the participant.
|
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
|
PROPOSAL NO. 3—NON-BINDING ADVISORY VOTE ON EXECUTIVE COMPENSATION
|
MISCELLANEOUS—GENERAL MATTERS
|
By Order of the Board of Directors
|
|
Sanjoy Mukherjee
|
|
Executive Vice President,
|
|
General Counsel and Secretary
|
|
April 11, 2019
|