XL Capital Ltd - 8K - 09/29/06
UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
D.C. 20549
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FORM
8-K
CURRENT
REPORT
Pursuant
to Section 13 OR 15(d) of The Securities Exchange Act of
1934
Date
of Report (Date of earliest event reported): September 29,
2006
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XL
CAPITAL LTD
(Exact
name of registrant as specified in its charter)
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Cayman
Islands
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1-10809
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98-0191089
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(State
or other jurisdiction
of
incorporation)
|
(Commission
File Number)
|
(I.R.S.
Employer Identification No.)
|
XL
House, One Bermudiana Road, Hamilton, Bermuda HM 11
(Address
of principal executive offices)
Registrant’s
telephone number, including area code: (441) 292 8515
Not
Applicable
(Former
name or former address, if changed since last report)
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Check
the appropriate box below if the Form 8-K filing is intended to simultaneously
satisfy the filing obligation of the registrant under any of the following
provisions:
[
]
Written communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
[
]
Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
[
]
Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange
Act
(17 CFR 240.14d-2(b))
[
]
Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange
Act
(17 CFR 240.13e-4(c))
Item
1.01. Entry
into a Material Definitive Agreement.
The
employment agreement for each executive further provides that, in the event
of
the termination of the executive’s employment prior to the expiration date of
the employment agreement (after giving effect to any extensions thereof) by
reason of death or disability, the executive (or in the case of death, the
executive’s spouse or estate) shall be entitled to receive the executives’ then
current base salary through the end of the six month period after the month
in
which the executive’s employment is terminated, and the executive (or the
executive’s estate) shall be entitled to any annual bonus awarded but not yet
paid and a pro rata bonus for the year of termination in an amount determined
by
the Compensation Committee (but not less than a pro rata portion of the
executive’s average annual bonus for the immediately preceding three years, or
the period of the executive’s employment, if less). The executive (or the
executive’s estate) shall also be entitled to the executive’s vested accrued
benefits under any employee benefit programs, continued rights with regard
to
any stock options or other rights with respect to equity securities of the
Registrant held by the executive in accordance with the terms of the plans
under
which such options or other rights were issued, and continued medical benefit
plan coverage for the executive and the executive’s dependents for a period of
six months.
In
the
event of termination of each executive’s employment by the Registrant without
Cause (as defined in the employment agreements), including termination of
employment following the Registrant’s issuance of a notice of nonrenewal of the
employment agreement, or by the executive if the executive is assigned duties
inconsistent with his or her position (but such assignment does not constitute
“Good Reason” as defined in the employment agreement), the executive shall be
entitled to (i) the executive’s then current base salary through the date
on which termination occurs, (ii) provided the executive executes a general
release of claims, a cash lump sum payment equal to the sum of (x) two times
the
executive’s then current base salary and (y) one times the higher of the
targeted annual bonus for the year of such termination or the average of the
executive’s annual bonus for the three years (or shorter period of employment)
immediately preceding the year of termination, and (iii) any annual bonus
awarded but not yet paid. The executive shall also be entitled to the
executive’s vested accrued benefits under any employee benefit programs,
continued rights with regard to any stock options or other rights with respect
to equity securities of the Registrant held by the executive in accordance
with
the terms of the plans under which such options or other rights were issued
and
continued medical benefit plan coverage for the executive and the executive’s
dependents for a period of 24 months.
Notwithstanding
the foregoing, in the event of termination of the executive’s employment (x) by
the Registrant without Cause within the 24-month period following a Change
in
Control (as defined in the employment agreements) (the “Post-Change Period”),
(y) by the executive for Good Reason during the Post-Change Period or (z) by
the
Registrant within one year prior to a Change in Control and it is reasonably
demonstrated that such termination arose in connection with or anticipation
of
the Change in Control, then the executive shall be entitled to (i) the
executive’s then current base salary through the date on which termination
occurs; (ii) a cash lump sum payment equal to the sum of (x) two times the
executive’s base salary and (y) two times the average of the executive’s
annual bonus for the three years (or shorter period of employment) immediately
preceding the year in which the Change in Control occurs, provided such bonus
shall be at least equal to the targeted annual bonus for the year of such
termination; and (iii) an amount equal to the higher of (x) the executive’s
annual bonus actually awarded in the year immediately preceding the year in
which the Change in Control occurs or (y) the targeted annual
bonus
that
would have been awarded to the executive for the year of such termination,
pro
rated by a fraction based on the number of months or fraction thereof in which
the executive was employed by the Registrant in the year of termination. The
executive shall also be entitled to continued medical benefit plan coverage
for
the executive and the executive’s dependents for a period of 24 months and to
accelerated vesting of the executive’s rights (i) under any retirement plans and
(ii) with regard to any stock options or other rights with respect to equity
securities of the Registrant held by the executive, which options or other
rights shall be exercisable for the shorter of three years or the original
term
of the security. In addition, the executive shall be entitled to gross-up
payments in the event excise taxes on the executive’s payments or benefits are
imposed under Section 280G of the United States Internal Revenue
Code.
In
the
event of termination of the executive’s employment by the Registrant with Cause
or other voluntary termination by the executive, the executive shall be entitled
to the executive’s then current base salary through the date on which
termination occurs and continued rights with regard to any stock options or
other rights with respect to equity securities of the Registrant held by the
executive in accordance with the terms of the plans under which such options
or
equity securities were issued. The executive shall also be entitled to the
executive’s vested accrued benefits under any employee benefit programs in the
case of voluntary termination and, if such programs expressly provide for such
benefits, in the case of termination by the Registrant with Cause.
The
employment agreements also provide for indemnification of the executive by
the
Registrant to the maximum extent permitted by applicable law and the
Registrant’s charter documents and requires the Registrant to maintain
directors’ and officers’ liability coverage in an amount equal to at least
$75,000,000.
Mr.
Veghte also was awarded shares of the Registrant's restricted common stock
and Ms. Street also was awarded stock options in consideration for his or her
entering into their respective employment agreements.
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant
has
duly caused this report to be signed on its behalf by the undersigned hereunto
duly authorized.
Date: October
3,
2006
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XL
CAPITAL LTD
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(Registrant)
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By:
/s/
Kirstin R. Gould
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Name: Kirstin Romann Gould
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Title: Secretary
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