UNITED STATES
SECURITIES AND EXCHANGE COMMISSIONWashington,WASHINGTON, D.C. 20549
the Securities Exchange Act of 1934 (Amendment No. )
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![[MISSING IMAGE: lg_siriusgroup-4c.jpg]](https://files.docoh.com/DEF 14A/0001104659-20-122496/lg_siriusgroup-4c.jpg)
TO BE HELD ON
Our Board recommends that you vote "FOR" the election of its nominees named in this proxy statement, "FOR" Proposals 2 and 4 and "ONE YEAR" on Proposal 3.
Our Board is deeply committed to the Company, its shareholders and enhancing shareholder value. We look forward to seeing you atyour participation in the annual meeting.
![[MISSING IMAGE: sg_meyerfrucher-bw.jpg]](https://files.docoh.com/DEF 14A/0001104659-20-122496/sg_meyerfrucher-bw.jpg)
Non-Executive Chairman of the Board
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April 5, 2019
![[MISSING IMAGE: sg_kernan-bw.jpg]](https://files.docoh.com/DEF 14A/0001104659-20-122496/sg_kernan-bw.jpg)
Chief Executive Officer
TO OUR SHAREHOLDERS:
| | Date | | | December 29, 2020 | |
| | Time | | | 8:30 a.m. local Bermuda time (7:30 a.m. EST) | |
| | Place | | | Via live audio webcast at: www.virtualshareholdermeeting.com/SG2020 | |
1. the
2. theremoval
3. the advisory vote to approve the frequency of future shareholder advisory votes on the compensation of the Company's named executive officers;
officers
5. to
6. theCompany’s bye-laws
thereof
virtually.
IMPORTANT NOTICE REGARDING
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Secretary
| | | IMPORTANT NOTICE REGARDING THE AVAILABILITY OF PROXY MATERIALS FOR THE ANNUALGENERALMEETING OF SHAREHOLDERS TO BE HELD ON DECEMBER 29, 2020. | | |
| | | The Company’s notice of the annual meeting, proxy statement and Annual Report on Form 10-K for the fiscal year ended December 31, 2019, are available on the Internet at www.proxyvote.com. | | |
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SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT | | | | | | | ||
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A.
A.The Securities and Exchange Commission ("SEC") has adopted rules that allow proxy materials to be posted to the Internet and provide only the notice to shareholders. We have elected to provide access to our proxy materials over the Internet, and accordingly have sent the notice to our shareholders of record and beneficial owners. Instructions on how to access the proxy materials over the Internet or to request a paper copy may be found in the notice. We will not mail a paper copy of the proxy materials to you unless specifically requested to do so. In addition, the notice contains instructions on how you may request access to proxy materials in printed form by mail or electronically on an ongoing basis. The notice also instructs you on how to submit your proxy electronically over the Internet or by mail.
Q. What proposals will be voted on at ourthe annual meeting?
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A.Admittance is limited to shareholders of the Company. If you are the shareholder of record, your name will be verified against the list of shareholders prior to your admittance to our annual meeting. You should be prepared to present photo identification for admission at our annual meeting. If you hold your shares in street name, you should provide proof of beneficial ownership on the record date, such as a brokerage account statement showing that you owned our common shares or Series B preference shares as of the record date, a copy of the voting instruction card provided by your broker, bank or other nominee or other similar evidence of ownership as of the record date, as well as your photo identification, for your admission. If you do not provide photo identification or comply with the other procedures outlined above upon request, you will not be admitted to our annual meeting. Please note that if your shares are held of record by a bank, broker or other nominee, and you decide to attend our annual meeting, you may not vote in person at our annual meeting unless you present a legal proxy, issued in your name from the record holder (your bank, broker or other nominee).
Q. How can I vote my shares without attending ourthe annual meeting?
A.If you hold shares directly as the shareholder of record, you may vote in person at the annual meeting or by proxy. In most instances, you will be
•- Via the Internet—You may vote by proxy on the Internet up until 11:59 p.m. U.S. Eastern Time the day before the annual meeting. The website for Internet voting is www.proxyvote.com. Easy-to-follow prompts allow you to vote your shares and confirm that your instructions have been properly recorded.•
•By Telephone—You may vote by proxy up until 11:59 p.m. U.S. Eastern Time the day before the annual meeting by using the toll-free number listed on your proxy card orVoting Instruction Form.voting instruction form. Easy-to-follow prompts allow you to vote your shares and confirm that your instructions have been properly recorded.••By Mail—Mark, sign and date your proxy card orVoting Instruction Formvoting instruction form and return it in the postage-paid envelope provided. Proxies submitted by mail should be received by the close of business on the day prior to the date ofourthe annual meeting.••Votingin Person atDuring the Annual General Meeting—IfShareholders may vote during the virtual annual meeting by visiting www.virtualshareholdermeeting.com/SG2020. To vote, youattendwill need your 16-digit control number included in your proxy materials, on your proxy card, or on the instructions that accompanied your proxy materials. We encourage you to vote via the Internet in advance of the annual meetingand wishtovote in person, you will be given a ballot at the annual meeting. Please note, however, that ifensure your shares areheld in "street name" by a broker, bank or other nominee and you wish to vote at the annual meeting, you must bring to the annual meeting a legal proxy from the record holder of the shares authorizing you to vote at the annual meeting. Submitting your vote by proxy will not affect your right to attend the annual meeting and to vote in person.represented.We Encourage You to Vote via the Internet.If you hold shares beneficially in street name, you may direct your vote in the manner prescribed by your broker, bank or other nominee
or, if you obtain(referred to as alegal proxy from your“brokerbank”) orother nominee,you may votein person atduring the annual meeting. Please refer to the voting instructioncardform included by yourbroker or nominee.broker.
Q.Can I change my vote or revoke my proxy?A.
You may change your vote or revoke your proxy at any time before it is voted atourthe annual meeting. If you are a shareholder of record, you may change your vote or revoke your proxy by:••
delivering to us a written notice of revocation of your proxy c/o Corporate Secretary, Sirius International Insurance Group, Ltd., 14 Wesley Street,5th5th Floor, Hamilton HM 11, Bermuda;
during the meeting.
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Q. What is a broker non-vote?
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Auditor Approval Proposal (Proposal Four)Three). The affirmative vote of a majority of the votes cast at the annual meeting is required for the approval of Proposal Four.Three. An abstention will have no effect on the voting results of Proposal Four.Three. Brokers will have discretionary authority to vote on this proposal. Accordingly, there will not be any broker non-votes on Proposal Four.Three.
Q. What is the deadline for submitting a proxy?
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my shares?”
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•"FOR"
Two.
assuming they are elected at the annual meeting, will resign from their position as directors of the Company. The consummation of the Merger is expected to occur during the first quarter of 2021, subject to the satisfaction or waiver of applicable closing conditions.
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| Kernan (Kip) V. Oberting | | | | ||
| | Chief Executive Officer and President, Sirius Group Age: 51 Director Since: February 2019 Committees: • None Other Current Public Directorships: • None Other Previous Public Directorships During Last Five Years: • None | | | Current and Past Positions: •Mr. Oberting was appointed as the CEO of Sirius Group on February 9, 2019. He also serves as the President of Sirius Group, a role he has held since September 2018. He was previously the Chief Financial Officer (“CFO”) of Sirius Group from 2016 to 2019 and President, Sirius Capital Markets, Inc. since 2015. • Prior to that, Mr. Oberting served as a Senior Partner of White Mountains Capital, Inc. from July 2012 until April 2016. • From 2008 to 2012, Mr. Oberting was the founder and Managing Member of Oakum Bay Capital (f/k/a KVO Capital Management). • From 2004 to 2008, Mr. Oberting served as Executive Vice President and Chief Financial Officer of Montpelier Re Holdings, Ltd. • Mr. Oberting previously worked for White Mountains entities from 1995 to 2004 in various capacities. • Prior to White Mountains, Mr. Oberting was a trader at CS First Boston (Japan) from 1993 to 1995. • Mr. Oberting received his B.A. from Dartmouth College. Key Qualifications, Experience and Attributes: Our Board considered Mr. Oberting’s extensive knowledge of Sirius Group’s business, having served as its CEO and President presently and as CFO in the past, among other roles, and his overall reputation and experience in the insurance and reinsurance industry. | |
| | Meyer (Sandy) Frucher | | | | |
Strategic Advisor to Nasdaq, Inc. & Non-Executive Chairman of the Board, Sirius Group Age: 74 | | Current and Past Positions: • Since January 1, 2020, Mr. Frucher has been Strategic Advisor to Nasdaq Inc. • He was formerly Vice Chairman of • Mr. Frucher also serves as a director of The Options Clearing Corporation, a position he has held since 2000. | | ||
| | Director Since: August 2016 Committees: • Nominating & Corporate Governance (C) • Compensation Other Current Public Directorships: • None Other Previous Public Directorships During Last Five Years: • None | | | • From 1998 to 2008, Mr. Frucher served as Chairman and Chief Executive Officer of the Philadelphia Stock Exchange. • Mr. Frucher has also served in various government positions, including as the chief labor negotiator for New York State, Chief Executive Officer of Battery Park City Authority and Chief Executive Officer of the School Construction Authority. • He received a B.A. from Columbia University and a M.P.A. from the John F. Kennedy School of Government, Harvard University. Key Qualifications, Experience and Attributes: Our Board considered Mr. Frucher’s extensive capital markets and corporate finance experience, as well as his expertise in the areas of corporate governance and strategic planning, and his qualification as an independent director. | |
| | Robert L. Friedman | | | ||
| | Private Investor Age: 61 Director Since: August 2016 Committees: • Audit & Risk Management • Finance Other Current Public Directorships: • None Other Previous Public Directorships During Last Five Years: • None | | | Current and Past Positions: • He served as the Chief Executive Officer and Chief Investment Officer of • In 1988, Mr. Friedman joined the Mutual Series Funds as an insurance analyst, and later served as a Vice President. • From 1996 until 2001, Mr. Friedman served as Senior Vice President of Franklin Mutual Series Funds, as well as a Portfolio Manager and, from 1998 to 2000, as Chief Investment Officer. • He has a B.A. from Johns Hopkins University, an M.B.A. from the University of Pennsylvania’s Wharton School and an A.L.M. from Harvard University Extension School. Key Qualifications, Experience and Attributes: Our Board considered Mr. Friedman’s extensive experience with investment portfolio matters, having served as a Chief Investment Officer of two investment firms, his lengthy experience as an insurance analyst as well as his knowledge of White Mountains Insurance Group (the former parent of Sirius Group), and his qualification as an independent director. | |
| Alain M. Karaoglan | | | |||
| | Senior Vice President, New York Life Insurance Age: 58 Director Since: November 2018 Committees: • Audit & Risk Management • Nominating & Corporate Governance • Finance Other Current Public Directorships: • None Other Previous Public Directorships During Last Five Years: • None | | | Current and Past Positions: • He has served as Senior Vice President, New York Life Insurance since September 2019. • Mr. Karaoglan previously served as the Chief Operating Officer • Prior to joining Voya, Mr. Karaoglan was Senior Vice President, Divestiture, for AIG from 2009 to 2011. Prior to AIG, from 2007 to 2009, Mr. Karaoglan was Managing Director, Equity Research, for Bank of America Securities LLC. • From 2000 to 2007, he was Managing Director, North American Equity Research, at Deutsche Bank Securities Inc. • Previously, from 1997 to 2000, he was an equity research analyst at Donaldson Lufkin & Jenrette after being in investment banking for approximately 10 years (1988 to 1997) at First Boston Corporation and, at Bear Stearns in the role of Managing Director. • Mr. Karaoglan received his bachelor’s degrees, both magna cum laude, in business administration and economics from Pepperdine University, and received his M.B.A. from Dartmouth College’s Tuck School of Business. Key Qualifications, Experience and Attributes: Our Board considered Mr. Karaoglan’s extensive leadership experience in global insurance and investment management companies, as well as his status as an Audit & Risk Management Committee financial expert based on his role as Chief Operating Officer of Voya, and his qualification as an independent director. | |
| | Rachelle C. Keller | | | | |
| | Former COO for the Prime, Futures and Securities Services division of Citigroup, NA Age: 57 Director Since: November 2018 Committees: • Audit & Risk Management (C) • Compensation (C) • Nominating & Corporate Governance Other Current Public Directorships: • None Other Previous Public | | | Current and Past Positions: • Ms. Keller previously served as a Managing Director for Citibank, NA (“Citi”), the institutional division of the financial services multinational Citigroup, from 2011 to her retirement in 2018, as Global Chief Operating Officer for Prime, Futures and Securities Services from 2014 to 2018, and as Global Head of Costing and Analytics, from 2011 to 2013. • From 2008 to 2011, Ms. Keller served as Chief Financial Officer for the Institutional Product Group, the brokerage division of Fidelity Investment LLC. • Prior to that, Ms. Keller was Managing Director at JP Morgan Chase & Co. and served in a variety of roles, including Chief Financial Officer of Treasury and Securities Services. • Prior to joining JP Morgan Chase & Co., Ms. Keller was a Certified Public Accountant at various public accounting firms. She is a member of Arkansas State University’s Founder’s Circle, where she graduated with a bachelor’s degree in accounting. | |
| | Directorships During Last Five Years: • None | | | Key Qualifications, Experience and Attributes: Our Board considered Ms. Keller’s extensive experience in finance and accounting and her experience as the Chief Operating Officer for the Prime, Futures and Securities Services division of Citi, and as the Chief Financial Officer of the Institutional Products Group of Fidelity Investments, LLC, and the Treasury and Security Services division of JP Morgan Chase, all of which qualifies her as an Audit & Risk Management Committee financial expert, as well as her qualification as an independent director. | |
| | Sabrina Maguire | | | | |
| | Head of Legal, Sun Hung Kai & Co. Limited Age: 53 Director Since: February 2020 Committees: • Finance (C) Other Current Public Directorships: • None Other Previous Public Directorships During Last Five Years: • None | | | Current and Past Positions: • Ms. Maguire has served as General Counsel, Asia Pacific for L’Oréal, a cosmetics company, since September 2020. Prior to that, she served as the Head of Legal for Sun Hung Kai & Co. Limited, an investment firm, since January 2019. • Prior to joining Sun Hung Kai & Co., Ms. Maguire worked in various capacities at General Electric, a multinational conglomerate, including as Executive Counsel Investigations, Asia at General Electric from January 2017 to December 2017, General Counsel — SE Asia & Greater China at GE Capital from April 2014 to December 2016, General Counsel — Structured Finance & CDF HK/Singapore, GE Capital from July 2011 — April 2014, and Senior Counsel — GES Asia & Capital Markets Asia, GE Capital from June 2008 to July 2011. • Ms. Maguire also served as Partner, Structured Finance of Latham Watkins LLP (Hong Kong) where she worked from 1997 to 2008. • Ms. Maguire also serves on the Board of Directors of CMIG International Holding Pte. Ltd. (“CMIG International”) as a representative of its minority investor, Sun Hung Kai & Co. Limited. • She has a B.A. from Harvard University and a J.D. from Boston University School of Law. Key Qualifications, Experience and Attributes: Our Board considered Ms. Maguire’s extensive legal experience in the specialty of structured finance in the Asian markets, her service as a director of CMIG International, and the request of CMIG International for Ms. Maguire to serve as CMIG International’s representative on the Board. | |
| | James (Jim) B. Rogers, Jr. | | | | |
| | Private Investor Age: 77 Director Since: November 2018 Committees: • Compensation Other Current Public Directorships: • Four publicly traded funds of Virtus Investment Partners, PJSC PhosAgro, Geo Energy Resources Limited, Ananti, Inc., EnPlus Co. Ltd. Other Previous Public Directorships During Last Five Years: • Spanish Mountain Gold Limited, Sinofortune Financial Holdings Limited; Crusader Resources Limited and Fab Universal Corp. | | | Current and Past Positions: • Mr. Rogers is an active author, financial commentator and international investor. He has previously served as a professor of finance at the Columbia University Graduate School of Business. • Mr. Rogers previously co-founded the Quantum Fund, is the author of several books, and also is a financial commentator worldwide. He has been frequently featured in Time, The Washington Post, The New York Times, Barron’s, Forbes, Fortune, The Wall Street Journal and many other media outlets worldwide. • He currently serves on the Board of four publicly traded funds operated by Virtus Investment Partners, as well as the Board of PJSC PhosAgro, Geo Energy Resources Limited, Ananti, Inc. and EnPlus Co. Ltd. Mr. Rogers serves on the Audit Committee of the Boards of two of the publicly traded funds operated by Virtus Investment Partners and PJSC PhosAgro. • Mr. Rogers graduated from Yale University in 1964 with a bachelor’s degree in history and from Oxford University in 1966 with a second bachelor’s degree in philosophy, politics and economics. Key Qualifications, Experience and Attributes: Our Board considered the breadth of his experience on public company boards and his extensive experience as an author, financial commentator and international investor, as well as his qualification as an independent director. | |
*Interim Chairman of the Board since February 2019.
Mr. Oberting was recently appointed as the CEO of Sirius Group on February 9, 2019, and became a director on February 28, 2019. He also serves as the President of Sirius Group, a role he has held since September 2018. He was previously the Chief Financial Officer of Sirius Group and President, Sirius Capital Markets, Inc. Mr. Oberting was appointed Chief Financial Officer of Sirius Group in April 2016. Prior to that, Mr. Oberting served as a Senior Partner of White Mountains Capital, Inc. from July 2012 until April 2016. Mr. Oberting was appointed as the President of Sirius Capital Markets, Inc. in January 2015. From 2008 to 2012, Mr. Oberting was the founder and Managing Member of Oakum Bay Capital (f/k/a KVO Capital Management). From 2004 to 2008, Mr. Oberting served as Executive Vice President and Chief Financial Officer of Montpelier Re Holdings, Ltd. Mr. Oberting previously worked for White Mountains entities from 1995 to 2004 in various capacities. Prior to White Mountains, Mr. Oberting was a trader at CS First Boston (Japan) from 1993 to 1995.
Mr. Liao has served as a representative of CMIG International on the Board of Sirius Group since April 2016. Mr. Liao has served as Chief Executive Officer and director of CMIG International, an international private investment company, since December 2014, and as a director of CM Bermuda since July 2015. Mr. Liao has also served as Assistant President of China Minsheng Investment Group Corp., Ltd. since October 2014, and as Chief Executive Officer and director of CMIG International Capital Limited since February 2015. From April 2004 to September 2014, Mr. Liao served in various positions culminating in the role of Vice President of Corporate Bank Department of Head Office of China Minsheng Banking Corp., Ltd., a private financial institution engaged in the corporate, institutional and personal banking sectors in China. Mr. Liao has served as a director of China Medical & HealthCare Group Limited since June 2016. From May 2015 to November 2017, Mr. Liao also served as a director of New Universe Environmental Group Limited.
Mr. Friedman has served as a director of Sirius Group since August 2016. He served as the Chief Executive Officer and Chief Investment Officer of Savannah-Baltimore Capital Management, LLC, an investment firm, from 2005 until 2007. In 1988, Mr. Friedman joined the Mutual Series Funds as an insurance analyst, and later served as a Vice President. From 1996 until 2001, Mr. Friedman served as Senior Vice President of Franklin Mutual Series Funds, as well as a Portfolio Manager and, from 1998 to 2000, as Chief Investment Officer. He has a B.A. from Johns Hopkins University, an M.B.A. from the University of Pennsylvania's Wharton School and an A.L.M. from Harvard University Extension School.
Mr. Frucher has served as a director of Sirius Group since August 2016. He is Vice Chairman of Nasdaq, Inc., a corporation that owns and operates the Nasdaq Stock Market, a position he has held since 2008. Mr. Frucher also serves as a director of The Options Clearing Corporation, a position he has held since 2000. From 1998 to 2008, Mr. Frucher served as Chairman and Chief Executive Officer of the Philadelphia Stock Exchange. Mr. Frucher has also served in various government positions, including as the chief labor negotiator for New York State, Chief Executive Officer of Battery Park City Authority and Chief Executive Officer of the School Construction Authority. He received a B.A. from Columbia University and a M.P.A. from the John F. Kennedy School of Government, Harvard University.
Mr. Karaoglan became a director of Sirius Group on November 5, 2018. Mr. Karaoglan previously served as the Chief Operating Officer of Voya Financial, Inc. ("Voya"), a financial, retirement, investment and insurance company, a position he had held from 2012 until 2018, and from 2011 to 2012, Mr. Karaoglan also served as Executive Vice President, Finance and Strategy of Voya. He brings extensive leadership experience in global insurance and investment management companies to the Board. Prior to joining Voya, Mr. Karaoglan was Senior Vice President, Divestiture, for AIG from 2009 to 2011. Prior to AIG, from 2007 to 2009, Mr. Karaoglan was Managing Director, Equity Research, for Banc of America Securities LLC. From 2000 to 2007, he was Managing Director, North American Equity Research, at Deutsche Bank Securities Inc. Previously, from 1997 to 2000, he was an equity research analyst at Donaldson Lufkin & Jenrette after being in investment banking for approximately 10 years (1988-1997) at First Boston Corporation and, as a Managing Director at Bear Stearns. Mr. Karaoglan received his bachelor's degrees, both magna cum laude, in business administration and economics from Pepperdine University, and received his M.B.A. from Dartmouth College's Tuck School of Business.
Ms. Keller became a director of Sirius Group on November 5, 2018. Ms. Keller previously served as a Managing Director for Citibank, NA ("Citi"), the consumer division of financial services multinational Citigroup, from 2011 to 2018 and as Global Chief Operating Officer for Prime, Futures and Securities Services from 2014 to 2018. Prior to these positions, Ms. Keller was the Managing Director, Global Head of Costing and Analytics at Citi from 2011 to 2013. She has also worked for Fidelity Investment, LLC and JP Morgan Chase earlier in her career. Ms. Keller is a Certified Public Accountant, although currently inactive. She is a member of Arkansas State University's Founder's Circle, where she graduated with a bachelor's degree in accounting.
Mr. Rogers became a director of Sirius Group on November 5, 2018. Mr. Rogers is an active author, financial commentator and international investor. He currently serves on the Board of four publicly traded funds operated by Virtus Investment Partners, as well as the Board of PJSC PhosAgro, Spanish Mountain Gold Limited, Geo Energy Resources Limited, Sinofortune Financial Holdings Limited and Ananti, Inc. Mr. Rogers previously co-founded the Quantum Fund, is the author of several books, and also is a financial commentator worldwide. He has been frequently featured in Time, The Washington Post, The New York Times, Barron's, Forbes, Fortune,The Wall Street Journal and many other media outlets worldwide. He has previously served as a professor of finance at the Columbia University Graduate School of Business. Mr. Rogers graduated from Yale University in 1964 with a bachelor's degree in history and from Oxford University in 1966 with a second bachelor's degree in philosophy, politics and economics.
Board Membership Considerations
When considering whether the Board Nominees have the experience, qualifications, attributes and skills, taken as a whole, to enable the Sirius Group Board to satisfy its oversight responsibilities effectively in light of the business and structure of Sirius Group, the Board focused primarily on each person's background and experience as reflected in the information discussed in each of the directors' individual biographies set forth above. In particular, the members of our Board considered the following important characteristics, among others:
•Mr. Oberting—our Board considered his extensive knowledge of Sirius Group's business, having served as its CEO and President presently and as CFO in the past, among other roles, and his overall reputation and experience in the insurance and reinsurance industry.•Mr. Liao—our Board considered his position as Chief Executive Officer of CMIG International, a leading international private investment group and the 100% owner of CM Bermuda, the sole holder of Sirius Group common shares prior to Sirius Group's merger with Easterly Acquisition Corp., which resulted in Sirius Group becoming a publicly listed company (the "Merger"), his leadership on behalf of CMIG International of its acquisition of Sirius Group, and his extensive financial services experience.•Mr. Friedman—our Board considered his extensive experience with investment portfolio matters, having served as a Chief Investment Officer of two investment firms, his lengthy experience as an insurance analyst as well as his knowledge of White Mountains Insurance Group (the former parent of Sirius Group), and his qualification as an independent director.•Mr. Frucher—our Board considered his extensive capital markets and corporate finance experience, as well as his expertise in the areas of corporate governance and strategic planning, and his qualification as an independent director.•Mr. Karaoglan—our Board considered his extensive leadership experience in global insurance and investment management companies, as well as his status as an Audit & Risk Management Committee financial expert based on his role as Chief Operating Officer of Voya, and his qualification as an independent director.•Ms. Keller—our Board considered her extensive experience in finance and accounting and her experience as the Chief Operating Officer for the Prime, Futures and Securities Services division of Citibank, NA, and as the Chief Financial Officer of the Institutional Products Group of Fidelity Investments, LLC, and the Treasury and Security Services division of JP Morgan Chase, all of which qualifies her as an Audit & Risk Management Committee financial expert, as well as her qualification as an independent director.
•Mr. Rogers—our Board considered the breadth of his experience on public company boards and his extensive experience as an author, financial commentator and international investor, as well as his qualification as an independent director.
Board
| | AUDIT & RISK MANAGEMENT COMMITTEE – Robert L. Friedman – Alain M. Karaoglan FE – Rachelle C. Keller C, FE Number of Meetings in Fiscal 2019: 8 | | | Responsibilities The Audit & Risk Management Committee is responsible for, among other things: • the appointment, compensation and oversight of the work of the independent auditor; • reviewing and discussing with management and the independent auditor the accounting practices and systems of internal accounting controls of Sirius Group, as applicable; • reviewing financial reports, accounting and financial policies in general, and procedures and policies with respect to internal accounting controls; • reviewing the independence qualifications and quality controls of the independent auditor; • oversight of the Company’s internal audit department; • overseeing the Company’s compliance with legal and regulatory requirements; • approving all auditing services and permitted non-audit services to be performed by the independent auditor; and • assisting the Board with its oversight of the Company’s enterprise risk management, including the significant policies, procedures and practices employed to manage cyber risk, liquidity risk, credit risk, market risk and insurance risk. | |
| | COMPENSATION COMMITTEE – Meyer (Sandy) Frucher – Rachelle C. Keller C – James (Jim) B. Rogers, Jr. Number of Meetings in Fiscal 2019: 6 | | | Responsibilities The Compensation Committee is responsible for, among other things: • reviewing and developing general compensation policies; • reviewing and approving the compensation of the Chief Executive Officer and other executive officers, including salary, annual incentive, long-term incentive and equity compensation and any other perquisites; • granting awards under equity incentive plans; • overseeing administration of other employee benefit plans; and • making recommendations regarding director compensation. | |
| | NOMINATING & CORPORATE GOVERNANCE COMMITTEE – Meyer (Sandy) Frucher C – Alain M. Karaoglan – Rachelle C. Keller Number of Meetings in Fiscal 2019: 4 | | | Responsibilities The Nominating & Corporate Governance Committee is responsible for, among other things: • identifying individuals qualified for membership on the Board and its committees; • recommending individuals to the Sirius Group Board for nomination as members of the Board; • advising and making recommendations to the Sirius Group Board on corporate governance matters and the overall governance structure of Sirius Group and the Board; and • reviewing Sirius Group’s position and policies that relate to current and emerging economic, social and governance public policy of significance to Sirius Group. | |
| | FINANCE COMMITTEE – Robert L. Friedman – Alain M. Karaoglan – Sabrina Maguire C Number of Meetings in Fiscal 2019: 4 | | | Responsibilities The Finance Committee is responsible for, among other things: • formulating Sirius Group’s investment policy and investment guidelines; • reviewing the performance and asset allocation of Sirius Group’s investment portfolio on a regular basis; and • monitoring the capital, debt, and corporate structure of Sirius Group and, in coordination with the Audit & Risk Management Committee, reviewing the adequacy of risk management. | |
See "Related Person Transactions—Transactions Related
Our
In addition to chairing meetings of the Board and meetings of the shareholders, the Non-Executive Chairman of the Board has significant additional responsibilities, including (i) having the authority to call meetings of the Board; (ii) setting the agendas for the Board meetings and executive sessions in consultation with the chairs of applicable committees of the Board; (iii) leading executive sessions of the Board; (iv) briefing the CEO on issues arising in the executive sessions, as appropriate; (v) facilitating discussion among the independent directors on key issues and concerns outside of a Board meeting and serving as a non-executive conduit to the CEO of the views, concerns and issues of the independent directors; (vi) overseeing that orders and resolutions of the Board are carried into effect; and (vii) performing such other duties and responsibilities as requested by the Board.
In February 2019, the Compensation Committee and Board implemented its succession plan to transition the role of CEO from Mr. Waters to Mr. Oberting.
The committees of the Sirius Group Board consist of an Audit & Risk Management Committee, a Compensation Committee, a Nominating & Corporate Governance Committee and a Finance Committee. Each of the Audit & Risk Management, Compensation and Nominating & Corporate Governance Committees are comprised entirely of independent directors, identified below. In addition, the members of the Audit & Risk Management Committee meet the enhanced independence standards set forth in Nasdaq listing standards and Rule 10A-3 under the Exchange Act, and two members qualify as an "audit committee financial expert" as such term is defined in applicable SEC rules. The written charters for each of these committees meet the requirements of Nasdaq listing standards and are available on our website atMeetingsir.siriusgroup.com.
Audit & Risk Management Committee
The Audit & Risk Management Committee is responsible for, among other things: (i) the appointment, compensation and oversight of the work of the independent auditor; (ii) reviewing and discussing with management and the independent auditor the accounting practices and systems of internal accounting controls of Sirius Group, as applicable; (iii) reviewing financial reports, accounting and financial policies in general, and procedures and policies with respect to internal accounting controls; (iv) reviewing the independence qualifications and quality controls of the independent auditor; and (v) approving all auditing services and permitted non-audit services to be performed by the independent auditor.
The members of our Audit & Risk Management Committee are Messrs. Friedman, Karaoglan and Ms. Keller (Chair). Our Board has designated Mr. Karaoglan and Ms. Keller as audit committee financial experts.
Compensation Committee
The Compensation Committee is responsible for, among other things: (i) reviewing and developing general compensation policies; (ii) reviewing and approving the compensation of the Chief Executive Officer and other executive officers, including salary, bonus, long-term incentive and equity compensation and any other perquisites; (iii) making awards under equity incentive plans; (iv) overseeing administration of other employee benefit plans; and (v) making recommendations regarding director compensation.
The members of our Compensation Committee are Messrs. Frucher, Rogers (Chair) and Ms. Keller.
Nominating & Corporate Governance Committee
The Nominating & Corporate Governance Committee is responsible for, among other things: (i) identifying individuals qualified for membership on the Board; (ii) recommending individuals to the Sirius Group Board for nomination as members of the Board and its committees; and (iii) advising and making recommendations to the Sirius Group Board on corporate governance matters and the overall governance structure of Sirius Group and the Board.
The members of our Nominating & Corporate Governance Committee are Messrs. Frucher (Chair), Karaoglan and Rogers.
The Board did not have a Nominating & Corporate Governance Committee prior to our public listing.
Finance Committee
The Finance Committee is responsible for, among other things: (i) formulating Sirius Group's investment policy and investment guidelines; (ii) reviewing the performance and asset allocation of Sirius Group's investment portfolio on a regular basis; and (iii) monitoring the capital, debt, and corporate structure of Sirius Group and, in coordination with the Audit & Risk Management Committee, reviewing the adequacy of risk management.
The members of our Finance Committee are Messrs. Friedman, Karaoglan and Liao (Chair).
During 2018,2019, our Board held eightnine meetings (including regularly scheduled and special meetings). Also during 2018,2019, the Audit & Risk Management Committee met fiveeight times, the Compensation Committee met fivesix times, the Nominating and& Corporate Governance Committee met oncefour times and the Finance Committee met four times.
All of but one of our then-current directors attended the 2019 annual general meeting of shareholders (the “
2019 annual meeting”).During 2019, the members of the Compensation Committee were James (Jim) B. Rogers, Jr., Meyer (Sandy) Frucher and Rachelle C. Keller. None of the members of the Compensation Committee during fiscal year 2019 was an officer or employee of the Company, and, during fiscal year 2019, no executive officer of the Company served on the board and/or compensation committee of any company that employed as an executive officer any member of the Board and/or the Compensation Committee. None of the members of the Compensation Committee during fiscal year 2019 had any relationships requiring disclosure under Item 404 of Regulation S-K for fiscal year 2019.
risk management, long-term business strategy and otherwise.
Sirius Group is considered a "foreign private issuer" under the rules and regulations of the SEC. A "foreign private issuer" is any issuer incorporated or organized under the laws of a foreign country, except an issuer meeting both of the following conditions: (i) more than 50% of the outstanding voting securities of the issuer are directly or indirectly held of record by residents of the U.S.; and (ii) any one of the following: (a) the majority of the executive officers or directors of the issuer are U.S. citizens or residents; (b) more than 50% of the assets of the issuer are located in the U.S.; or (c) the business of the issuer is administered principally in the U.S. Pursuant to the "foreign private issuer" rules. Sirius Group is exempt from certain provisions of the Exchange Act applicable to U.S. domestic public companies, including: (1) the sections of the Exchange Act regulating the solicitation of proxies, consents or authorizations in respect of a security registered under the Exchange Act; (2) the sections of the Exchange Act requiring insiders to file public reports of their stock ownership and trading activities and liability for insiders who profit from trades made in a short period of time; and (3) the rules under the Exchange Act requiring the filing with the SEC of quarterly reports on Form 10-Q containing unaudited financial and other specific information, or current reports on Form 8-K, upon the occurrence of specified significant events.
In addition, Sirius Group is a "controlled company" within the meaning of Nasdaq rules. A "controlled company" is a company of which more than 50% of the voting power is held by an individual, group or another company. Pursuant to the "controlled company" exemption, Sirius Group is not required to comply with the requirements that: (1) a majority of the Board consist of independent directors; (2) it have a nominating committee composed entirely of independent directors with a written charter addressing such committee's purpose and responsibilities and (3) it have a compensation committee that is composed entirely of independent directors with a written charter addressing the committee's purpose and responsibilities.
Sirius Group does not currently rely on, or intend to rely on in the future, the scaled disclosure practices permitted by the SEC or the alternate governance practices permitted by Nasdaq applicable to foreign private issuers and/or controlled companies, and is voluntarily choosing to register and report using the SEC's domestic forms and comply with the Nasdaq governance practices applicable to domestic companies.
The Board, on behalf of itself and our other non-management directors, has established procedures to enable employees or other parties who may have a concern about conduct or policies to communicate that
Merger Agreement
”), by and among the Company, Third Point Reinsurance Ltd., a Bermuda exempted company (“TPRE”), and Yoga Merger Sub Limited, a Bermuda exempted company and a wholly owned subsidiary of TPRE (“Merger Sub”). The membersMerger Agreement provides, among other things, that, upon the terms and subject to the conditions set forth in the Merger Agreement and a Statutory Merger Agreement to be executed by the Company, TPRE and Merger Sub (the “Statutory Merger Agreement”), Merger Sub will merge with and into the Company, with the Company surviving as a wholly owned subsidiary of our Board, executive officersTPRE (the “Merger”).
Transactions Related to the Easterly Merger
Pursuant to the See “
Pursuant to the Shareholders Agreement, CM Bermuda will also agree to vote (i) in favor of a Qualified Sale Transaction (as such term is defined in the Shareholders Agreement) that is approved by a majority of Independent Directors and 80% of Sirius Group's voting shares after November 5, 2019, and (ii) against any merger, amalgamation, consolidation or similar transaction or any sale or transfer of all or substantially all of Sirius Group's consolidated assets, in each case where the per share value of the consideration received by CM Bermuda in such transaction is greater than the per share value of the consideration received by any other holder of Sirius Group common shares.
The Shareholders Agreement also grants the Preference Share Investors tag-along rights to the extent Sirius Group agrees to repurchase or redeem any common shares held by CM Bermuda.
The Shareholders Agreement terminates on the date that fewer than 25% of the Sirius Group Series B preference shares issued in the Sirius Group Private Placement are outstanding, and earlier with respect to any Preference Share Investor at the time that it or its affiliates or permitted assigns ceases to own any Sirius Group Series B preference shares.
Common Shares Redemption Agreement
In connection with the closing of the Merger, Sirius Group and CM Bermuda entered into a Registration Rights Agreement, which governs certain rights and obligations of Sirius Group and CM Bermuda with respect to the registration of the Sirius Group common shares owned by CM Bermuda, and CM Bermuda delivered the Lock-Up Agreement, pursuant to which it agreed not to sell any Sirius Group common shares for a period of 180 days from the consummation of the Merger without the consent of Sirius Group, subject to specified exemptions.
Related Person Transaction Policies and Procedures for Related Person Transactions
Committee is responsible for reviewing and making recommendations to the Board regarding matters pertaining to compensation paid to directors for Board, committee and committee chair services. In making non-employee director compensation recommendations, the Compensation Committee takes various factors into consideration including, but not limited to, input received from the Compensation Committee’s independent compensation consultant, the responsibilities of the directors generally, as well as committee chairs, and the form and amount of compensation paid to directors by comparable companies. The Board reviews the recommendations of the Compensation Committee and determines the form and amount of director compensation. The table below sets forth the elements of our annual compensation program for our non-employee directors for the year ended December 31, 2019. The director compensation program has remained unchanged since the prior year except with respect to the addition of an annual retainer paid to and the incremental grant of Company restricted shares awarded to the Non-Executive Chairman of the Board. The Compensation Committee determined to award this additional retainer based upon a report presented by Sirius Group. On October 31, 2018, in connection with the public listing, the Board approved changes to our annualits independent compensation program.
| Annual Compensation Retainers | | | Annual Fee | | |||
| Board Retainer | | | | $ | 130,000 | | |
| Non-Executive Chairman of the Board | | | | $ | 130,000 | | |
| Audit & Risk Management Committee Chair | | | | $ | 30,000 | | |
| Audit & Risk Management Committee Member | | | | $ | 10,000 | | |
| Finance Committee Chair | | | | $ | 20,000 | | |
| Finance Committee Member | | | | $ | 10,000 | | |
| Compensation Committee Chair | | | | $ | 20,000 | | |
| Compensation Committee Member | | | | $ | 7,500 | | |
| Nominating & Corporate Governance Committee Chair | | | | $ | 20,000 | | |
| Nominating & Corporate Governance Committee Member | | | | $ | 7,500 | | |
Director Compensation Summary Annual Compensation Retainers | Prior to October 31, 2018 | After November 1, 2018 Amount | |||||
|---|---|---|---|---|---|---|---|
Board Retainer | $ | 150,000 | $ | 130,000 | |||
Audit & Risk Management Committee Chair | $ | 25,000 | $ | 30,000 | |||
Audit & Risk Management Committee Member | $ | 10,000 | $ | 10,000 | |||
Finance Committee Chair | $ | 15,500 | $ | 20,000 | |||
Finance Committee Member | $ | 10,000 | $ | 10,000 | |||
Compensation Committee Chair | $ | 10,000 | $ | 20,000 | |||
Compensation Committee Member | $ | 7,500 | $ | 10,000 | |||
Nominating & Corporate Governance Committee Chair | N/A | $ | 20,000 | ||||
Nominating & Corporate Governance Committee Member | N/A | $ | 7,500 | ||||
All retainers are paid quarterly in arrears in cash and are prorated based upon Board, chair or chaircommittee service during the calendar year.
Messrs. Friedman and Frucher also received a
Name | Fees Earned or Paid in Cash ($)(1) | Share Awards ($)(2) | All Other Compensation ($) | Total ($) | |||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Meyer (Sandy) Frucher | $ | 177,500 | $ | 138,329 | — | $ | 315,829 | ||||||
Robert L. Friedman | $ | 170,000 | $ | 138,329 | — | $ | 308,329 | ||||||
Alain Karaoglan | $ | 24,231 | $ | 48,329 | — | $ | 72,560 | ||||||
Rachelle C. Keller | $ | 25,769 | $ | 48,329 | — | $ | 74,098 | ||||||
James (Jim) B. Rogers, Jr. | $ | 24,231 | $ | 48,329 | — | $ | 72,560 | ||||||
Name Fees Earned or Paid
in Cash ($)(1) Share Awards
($)(2) All Other
Compensation
($) Total ($) Meyer (Sandy) Frucher $ 276,667 $ 110,000 — $ 386,667 Robert L. Friedman $ 150,000 $ 90,000 — $ 240,000 Alain Karaoglan $ 157,500 $ 90,000 — $ 247,500 Rachelle C. Keller $ 167,500 $ 90,000 — $ 257,500 James (Jim) B. Rogers, Jr. $ 157,500 $ 90,000 — $ 247,500 (1)Reflects amounts earned in20182019 for the annual Board retainer, committee chair retainers, and committee member retainers. Theamountsamount forMessrs. Karaoglan and Rogers and Ms. Keller reflectMr. Frucher reflects thepro-rated retainers paid to them because they joinedadditional retainer he receives as Non-Executive Chairman of the Board,in November 2018.pro-rated from January 30, 2019.(2)(2)- These amounts reflect the grant date fair value determined in accordance with Financial Accounting Standards Board Codification Topic 718,
Compensation—Compensation — Stock Compensation("(“FASB ASC Topic 718"”), of the annual grant of restricted shares to each non-employee director listed above under the 2018 Omnibus Incentive Plan.
The following table shows the number of restricted shares held by each of the non-employee directors as of December 31,2018.2019. Ms. Keller and Messrs. Friedman Frucher, Karaoglan and Rogers received a grant of2,8056,923 restricted shares onNovember 5, 2018May 23, 2019 which vests onMay 23, 2019,the date of the annual meeting, and,Messrs. Friedman andMr. Frucher received an additional grant of5,2252,424 restricted shares onNovember 5, 2018August 22, 2019 in connection with his appointment as Non-Executive Chairman of thepublic listing andBoard which also vestsone year fromon the date ofgrant.the annual meeting. Messrs. Liao and Tan and Ms. Maguire are excluded from this table because they did not hold outstanding equity awards with respect to Sirius Group as of December 31, 2019.Name Number of
Restricted Shares NameNumber ofRestrictedSharesMeyer (Sandy) Frucher
8,030 9,347 Robert L. Friedman
8,030 6,923 Alain Karaoglan
2,805 6,923 Rachelle C. Keller
2,805 6,923 James (Jim) B. Rogers, Jr.
2,805 6,923 21INFORMATION ABOUT OUR EXECUTIVE OFFICERSThe following table sets forth informationas of March 29, 2019regarding the individuals who serve as our executive officers, excluding Mr.Oberting'sOberting’s biographical information. Mr.Oberting'sOberting’s biographical information can be found in the section entitled"“Matters to be considered at the Annual Meeting—Proposal One—Election of Directors—Board NomineesDirectors.."”Name Age Position NameAgePositionKernan (Kip) V. Oberting
4951 President and CEO, Sirius Group Monica Cramér Manhem59Chief Operating Officer, Sirius Group and President and CEO, Sirius InternationalRalph A. Salamone
5253 Executive Vice President, Chief Financial Officer, Sirius Group Gene Boxer
4446 Executive Vice President, Chief Strategy Officer & Group General Counsel, Sirius Group Monica Cramér Manhem
61 President, Global Reinsurance and Managing Director, Sirius International Insurance Corporation (“Sirius International”) Jeffrey W. Davis 5456 Executive Vice President, Chief Risk Officer & Chief Actuary, Sirius Group Ms. Cramér Manhemserves as Chief Operating Officer of Sirius Group and President and Chief Executive Officer of Sirius International. Ms. Cramér Manhem was appointed Chief Operating Officer of Sirius Group in September 2018, has been the Chief Executive Officer of Sirius International since March 2014, and also serves as the Chairperson of Sirius Bermuda. Prior to March 2014, Ms. Cramér Manhem served as Senior Vice President and Business Unit of Sirius International from January 2004 until March 2014. Ms. Cramér Manhem served in various positions at Sirius International prior to 2004, having joined Sirius Group in 1985.Mr. Salamone,serves as Chief Financial Officer of Sirius Group, since February 2019. He also serves as the President and Chief Executive Officer of Sirius Global Services LLC, a position he has held since 2010. Ralphhasalso served as the Senior Vice President, Chief Financial Officer and Treasurer at Sirius America Insurance Companysince 2012.from 2012 to 2019. Since joining Sirius Group in 1997, Mr. Salamone has been a key member of theGroup'sGroup’s executive financial team. Prior to joining Sirius Group,RalphMr. Salamone served as the Assistant Controller at Assurant.RalphMr. Salamone began his career in public accounting at PricewaterhouseCoopers, serving a variety of insurance clients as an audit manager.Mr. Boxer serves as Executive Vice President, Chief Strategy Officer & Group General Counsel of Sirius Group. Mr. Boxer was appointed Chief Strategy Officer of Sirius Group in September 2018 and Executive Vice President and Group General Counsel of Sirius Group in August 2016. In August 2019, Mr. Boxer also assumed the additional responsibilities of overseeing the Sirius Group human resources function. From 2011 until 2015, Mr. Boxer served as Global General Counsel of Cushman & Wakefield, a commercial real estate services firm. From 2006 until 2011, Mr. Boxer served as a senior member of the Restructuring Group and Legal Mergers & Acquisitions Group of American International Group, Inc. (AIG). Prior to 2006, Mr. Boxer practiced at Milbank, Tweed, Hadley & McCloy LLP, focusing on mergers and acquisitions and securities offerings.Ms. Cramér Manhem serves as President, Global Reinsurance since August 2019 and Managing Director of Sirius International. Ms. Cramér Manhem previously served as Chief Operating Officer of Sirius Group from September 2018 to August 2019. Ms. Cramér Manhem has been the Chief Executive Officer of Sirius International since March 2014, and also serves as the Chairperson of Sirius Bermuda. Prior to March 2014, Ms. Cramér Manhem served as Senior Vice President and Business Unit Head of Sirius International from January 2004 until March 2014. Ms. Cramér Manhem served in various positions at Sirius International prior to 2004, having joined a predecessor to Sirius Group in 1985.Mr. Davis serves as Executive Vice President, Chief Risk Officer & Chief Actuary of SiriusGroup. Mr. DavisGroup, a position he hasserved as Executive Vice President, Chief Risk Officer & Chief Actuary of Sirius Groupheld since April 2016. Mr. Davis previously served also as Senior Vice President and Chief Actuary at White Mountains from October 2008 until April 2016. In April 2016, Mr. Davis assumed the additional responsibilities as Chief Risk Officer for Sirius Group. Prior to joining Sirius Group, Mr. Davis served as Head of Central Reserving for Munich Re from 2005 until September 2008, and previously in various capacities at American Re-Insurance Company since 1999. Mr. Davis previously served as an actuary for Nationwide Insurance from 1991 until 1999.22COMPENSATION DISCUSSION AND ANALYSISEXECUTIVE COMPENSATIONImpact of Merger Agreement & Transaction Retention ProgramIn connection with the announcement of a strategic review process, the Compensation Committee, after receiving feedback from TPRE, determined to implement a retention program to help preserve the value of the Company for the benefit of existing and future shareholders. The Compensation Committee, together with the directors of TPRE, developed a long-term retention program that was designed to be cost-effective by leveraging the Company’s existing long-term incentive grants while supporting the Company’s retention objectives.The retention program was implemented in two phases. In July 2020, the Company implemented the first phase by permitting active employees to convert issued and outstanding performance share units (“PSUs”) into time-based restricted share units (“RSUs”), which are now generally subject to longer vesting terms as further described below. In phase two, the Merger Agreement provides for the conversion of time-based RSU awards into TPRE RSU awards, as described below.While the Merger will impact outstanding equity awards as described below, the Compensation Discussion and Analysis section of this proxy statement describes the 2019 compensation program, without taking into consideration the impact of the Merger as the Merger was not consummated as of December 31, 2019.Phase 1 — Transaction Retention ProgramTreatment of 2018-2020 Performance AwardsThe 2018-2020 performance awards are governed by the Sirius Group 2016 Long Term Incentive Plan (“2016 LTIP”) and were eligible to vest based on specific, objective financial performance measures established at the beginning of the three-year performance cycle. In July 2020, the Compensation Committee approved the settlement of the 2018-2020 awards at a deemed achievement level (17% of target) to be paid out in cash at a price per share equal to the Company’s BVPS as of June 30, 2020. The cash payment was made on or about August 24, 2020.On the same day of the cash payment, active employees received special time-vesting cash-based RSU grants for the balance between the deemed achievement level and 100% of the target performance percentage for the 2018-2020 PSUs. The special time-vesting cash-based RSUs shall vest equally in two tranches, in January 2023 and January 2024. As a condition to receiving and solely with respect to this special RSU award, participants were required to acknowledge that, following a “Change in Control,” the “Good Reason” definition in the Severance and Change in Control Plan would exclude changes in title, reporting responsibilities or budget over which the participant is responsible.Treatment of 2019-2021 Performance Awards and IPO Incentive AwardsUnder the retention program, equity awards granted in connection with the Company’s going-public transaction (the “IPO Incentive Awards”) and 2019-2021 awards were converted into time-vesting cash-based RSUs at the current projected performance level (72% of target for the IPO Incentive Awards and 38% of target for the 2019-2021 awards), with no change to the original vesting dates. At the time of conversion, employees received special additional time-vesting cash-based RSU awards for the balance between the projected level of performance and 100% of target performance, with vesting extended by one additional year beyond the existing vesting schedule.Phase II — Impact of Merger AgreementPursuant to the terms of the Merger Agreement, and at the effective time of the Merger, each of the outstanding time-vesting RSUs described above, will, by virtue of the Merger be assumed by TPRE and converted into RSUs relating to, and settled by the delivery of, a number of TPRE common shares equal to23the number of Company shares subject to the Company award multiplied by an exchange ratio intended to preserve the value of the award, and subject to all other terms and conditions as were applicable under such corresponding Company award.In addition, the Merger Agreement provided that each outstanding and unexercised Company stock option will, by virtue of the Merger, be assumed by TPRE and converted into an option to acquire TPRE common shares on the same terms and conditions as were applicable under such Company option, except that the number of TPRE common shares subject to each assumed option and the applicable exercise price will be adjusted by an exchange ratio to preserve the value of the option.2019 Cash Retention Award and 2020 Annual Incentive AwardsThe Compensation Committee also approved the accelerated cash payment of the 2019 cash retention awards and target 2020 annual incentive awards to Mr. Oberting and Mr. Boxer, at the earlier of the effective time of the Merger or December 31, 2020, subject to the vesting conditions that would otherwise apply to such awards. On August 6, 2020, in connection with the Company’s entry into the Merger Agreement, the Company entered into a letter agreement with each of Mr. Oberting and Mr. Boxer, intended to provide them with certain assurances that will minimize any distractions they would otherwise face as they complete the transactions contemplated by the Merger Agreement. Specifically, the letter agreements entitle Mr. Oberting and Mr. Boxer to severance protection if their employment is terminated involuntarily without Cause or they resign for Good Reason, in either case prior to the consummation of the Merger and following a Removal Event, with the same benefits they would receive if they were terminated by the Company without Cause immediately after the consummation of the Merger. For this purpose, “Cause” and “Good Reason” have the definitions used in the applicable existing compensation or severance plan or agreement, except that “Good Reason” also includes the removal from the Company’s board of directors of independent directors who are considered members of the Original Strategic Review Committee (as defined in the Merger Agreement) and, in Mr. Oberting’s case, his own removal from the Company’s board of directors (a “Removal Event”). In addition, the letter agreement provided an acknowledgement that each of Mr. Oberting and Mr. Boxer will have “Good Reason” to resign from employment immediately upon consummation of the Merger. The letter agreement additionally provided that if a severance dispute arises after the removal of the Original Strategic Review Committee members from the Company’s board of directors, subject to certain exceptions, the Company has agreed to reimburse to the executive any resulting reasonable expenses incurred to resolve such dispute.COMPENSATION DISCUSSION & ANALYSISThis Compensation Discussion and Analysis("(“CD&A"”) provides an overview of our executive compensation philosophy and the compensation provided to our named executive officers("(“NEOs"”) for2018.2019. As used in this CD&A,"we," "our,"“we,” “our,” and"us"“us” refer to Sirius Group. This CD&A describes the original program in place with respect to 2019 and does not take into account the expected impact of the Merger, as described above.Our NEOs for20182019 consist of our current principal executive officer (“CEO”), former CEO, principal financial officer (“CFO”) and the three most highly compensated executive officersserving as executive officersother than the CEO and CFO, for the year ended December 31,2018. For 2018,2019. References in our CD&A to “NEOs” refer to our NEOs other than our former CEO, unless the context suggests otherwise. For 2019, our NEOs were:Name Title Kernan (Kip) V. Oberting President and CEO and Former Executive Vice President, CFO Ralph A. Salamone Executive Vice President, CFO Monica Cramér Manhem President, Global Reinsurance, Sirius Group and Managing Director, Sirius International Gene Boxer NameExecutive Vice President, Chief Strategy Officer (“TitleCSO Jeffrey W. Davis Executive Vice President, Chief Risk Officer (“CRO”) & Chief Actuary Allan L. Waters Former Chairman of the Board and Chief Executive Officer ("CEO"), Sirius Group*.Kernan (Kip) V. ObertingCEO*President and CEO (and Former Chief Financial Officer* ("CFO")), Sirius Group and President, Sirius Capital Markets, Inc.Monica Cramér ManhemChief Operating Officer ("COO"), Sirius Group and President and CEO, Sirius International Insurance Corp. ("Sirius International")Gene BoxerExecutive Vice President, Chief Strategy Officer ("CSO") & Group General Counsel, Sirius GroupJeffrey W. DavisExecutive Vice President, Chief Risk Officer ("CRO") & Chief Actuary, Sirius Group- *
As of February 9, 2019, Mr. Waters departed from the Company and Mr. Oberting was appointed CEO.24Unless otherwiseprovided,stated, references to CEO and CFO throughout the CD&A refer to Messrs.WatersOberting andOberting,Salamone, respectively, as each served in such capacity during theentiretymajority of2018.2019.
Executive SummarySirius Group’s Fiscal 2019 Compensation HighlightsSirius Group’s fiscal 2019 executive compensation program was designed to be consistent with its executive compensation principles, pay-for-performance philosophy and commitment to sound corporate governance, as summarized below.•Significant Majority of NEOs’ Direct Compensation was At-Risk Compensation. The graphics below show that the fiscal 2019 target direct compensation for each NEO was weighted toward at-risk, variable incentive awards (in the form of both short-term cash incentives and equity incentives).•No gross-ups.In August 2018,With the elimination of Mr. Waters’ employment agreement the Company is not contractually required to pay 280G gross-ups to any NEOs.•Elimination of Bermuda Housing Costs. The Company eliminated the payment of Bermuda housing costs for its executive officers effective as of June 2019.•Focused Cash Compensation Increases. The only changes in target cash compensation for the NEOs in fiscal 2019 were base salary increases of approximately 25% and 3%, respectively, for each of Messrs. Salamone and Davis, with Mr. Salamone’s increase driven by his promotion to the position of CFO.•Annual Incentive and Long Term Incentive Compensation Payouts. Commensurate with our performance, paid annual cash incentive payments at 55% of the aggregate target pool amount, with individual NEO payouts based on business segment, functional and individual performance, and 2017-2019 long term incentive compensation at 2% of target.•Successful Management Transition. The Compensation Committee and the Boarddesignated a Management Committee comprisedhave taken several actions in recent years to facilitate long-term succession planning and recognize key executives who have made significant contributions to the Company’s success and retention. As further discussed on page 13, during 2019, the Board focused on CEO succession planning in fiscal 2019, culminating with the promotion ofMessrs. Waters,Mr. Oberting to the position of CEO andBoxerMr. Salamone to the position of CFO.•Paid Retention Awards to senior executives, including the NEOs, to retain talent. Based on an analysis of peer data by Frederick W. Cook & Co. Inc. (“F.W. Cook”), the Compensation Committee’s independent consultant, andMs. Cramér Manhem asconsidering incentive compensation realized by and thesenior management and decision-making bodyforecasted long-term incentive compensation payout values for employees of Sirius Group,responsible fortheoversightCompensation Committee awarded certain employees of theday-to-day business operationsCompany cash and equity retention awards to support the continuity ofSirius Group (the "such employees’ service to the Company, including certain of the NEOs. SeeManagementRetention Awards below.2019 Target Compensation Pay Mix*![[MISSING IMAGE: tm2035095d1-pc_target4c.jpg]](https://files.docoh.com/DEF 14A/0001104659-20-122496/tm2035095d1-pc_target4c.jpg)
25*The graphics above display the annual direct compensation program applicable to our NEOs, which includes base salary, annual cash incentive and long-term incentive compensation. These graphics do not include or otherwise take into account the value of any retention awards or other compensation that were paid to our NEOs in 2019.Summary of Our Executive Compensation PracticesThe table below highlights certain executive compensation practices we have implemented that are designed to incentivize and drive performance as well as certain practices we have not implemented because we do not believe they would serve our shareholders’ interests. What We Do What We Don’t Do ![[MISSING IMAGE: tm2035095d1-icon_tick4clr.jpg]](https://files.docoh.com/DEF 14A/0001104659-20-122496/tm2035095d1-icon_tick4clr.jpg)
We tie pay to performance by designing a significant portion of executive pay to be at-risk, 91% of the CEO’s 2019 compensation and, on average 76% of the other NEOs’ compensation, is at-risk ![[MISSING IMAGE: tm2035095d1-icon_circle4clr.jpg]](https://files.docoh.com/DEF 14A/0001104659-20-122496/tm2035095d1-icon_circle4clr.jpg)
We do not reprice underwater stock options without shareholder approval We mitigate undue risk in compensation programs through informed performance goal-setting that considers multiple financial and non-financial inputs We do not award stock options with an exercise price below 100% of fair market value We retain the services of an independent compensation consultant We do not allow our directors, executive officers, employees and their related persons to pledge the Company’s securities as collateral for loans or for any other purpose We generally consider market and industry data when setting executive pay, using the median as a reference point to understand the general market We do not allow our directors, executive officers, employees and their related persons to hedge the Company’s securities We offer double-trigger-change-in-control benefits We do not provide tax gross-ups on perquisites We grant performance share units that have a three-year performance period We do not provide tax gross-ups on change in control benefits We maintain a clawback policy applicable to executive officers in the event of a financial statement restatement We offer our executives only limited perquisites We pay market based severance multiples upon a termination of employment Results of Say-on-Pay Vote and Frequency of Say-on-Pay OutcomesWe held a non-binding advisory shareholder vote on the compensation of our NEO’s, commonly referred to as “say-on-pay” vote at our 2019 annual meeting. At our 2019 annual meeting, more than 99% of the votes cast were case in favor of the “say-on-pay” proposal. The Compensation Committee").considered the result of this advisory vote to be an endorsement of our executive compensation program, policies, practices and philosophy and did not make any compensation changes to the 2019 compensation program as a result of the say-on-pay voting results. The Board and Compensation Committee will continue to consider the outcome of our say-on-pay votes when making future executive compensation decisions for our NEOs.InSeptember 2018, Mr. Oberting was appointed as Presidentlight ofSirius Group, Ms. Cramér Manhem was appointed as Chief Operating Officerthe voting results with respect to the frequency ofSirius Group and Mr. Boxer was appointed as Chief Strategy Officer of Sirius Group.On January 30, 2019,holding a non-binding advisory vote on executive compensation, the Boardapproved a succession plan whereby Mr. Waters departed fromhas determined that the Companyeffective aswill hold future non-binding advisory votes ofFebruary 9, 2019 (the "Departure Date"). As partshareholders to approve the compensation ofthis succession plan, alsothe NEOs every year until the next non-binding advisory vote of shareholders onJanuary 30, 2019,the frequency of shareholder votes on executive compensation in 2025, or until the Boardappointed Mr. Oberting as CEO, effective as of the Departure Date. In connection with this appointment, Mr. Oberting resigned as CFO, and Ralph A. Salamone, the Company's principal accounting officer, was appointed as CFO, both effective as of the Departure Date. See "Management Transition Compensation"otherwise determines a different frequency foradditional information.such non-binding advisory votes.26Executive Compensation PhilosophyWe believe that SiriusGroup'sGroup’s executive compensation program should be designed to align management incentives with the creation of shareholder returns over the long-term. For that reason, and as illustrated in the chartbelow,above, our senior executives have typically received the majority of their total target direct compensation (i.e., annual base salary, annualbonuscash incentive awards and long-term incentive awards) in the form of long-termperformance-basedincentive compensation. We believe that delivering a significant portion of total direct compensation in the form of long-termperformance-basedincentive compensation, a significant portion of which is performance-based, focuses management on making decisions linked to optimizing the long-term economic performance of Sirius Group.2018 Target Compensation Pay Mix
The Compensation Committee believes that compensation goals should be predominantly objective and clearly measurable. We believe that effective compensation programs should be designed so that participants understand how their performance will be assessed and how performance will impact payouts under our incentive programs. Accordingly, Sirius Group has designed its long-term incentive compensation program with payouts based on financial performance compared to objective performance targets. Our annual
bonuscash incentive program is designed in a similar manner, but with Compensation Committee ability to adjust payouts to reflect individual performance, based on measurable individual and team performance achievements and a subjective assessment of performance. Sirius Group believes this design incentivizes management and employees to think like owners. The Compensation Committee also retains the ability to grant additionallong-termincentives as it deems appropriate to support theCompany'sCompany’s overall compensation philosophy and achievement of other business objectives.For example,Management Transition CompensationThe compensation of certain executive officers was revised in connection with the departure of Mr. Waters from the Company effective as of February 9, 2019. As Mr. Waters’ separation was a termination without cause (as defined in his employment agreement with the Company) in accordance with his employment agreement, Mr. Waters received a severance benefit equal to (i) one times his base salary immediately before his separation, (ii) an annual cash incentive payment for 2018 based on actual performance targets, and (iii) a payment in connection with his 2019 annual cash incentive based on actual performance but no less than his target cash incentive opportunity of one half of his base salary. Mr. Waters will provide advisory services to the Company for a period of time, during which period he will continue to vest in pending long-term incentive awards in accordance with his employment agreement. In connection with such services, Mr. Waters receives a fee of $30,000 per year and certain health care benefits. Unless earlier terminated by the Company for cause or due to his death or disability, the term of Mr. Waters’ advisory services under his employment agreement continues until the later of (i) the first date on which the expiration of his COBRA participation under Sirius Group’s applicable health plan would result in immediate Medicare eligibility (April 2021) and (ii) the last date on which his outstanding long-term incentive awards are earned in accordance with their terms.Mr. Oberting was appointed CEO of the Company, effective as of February 9, 2019. In connection with this appointment, the Company entered into an employment agreement with Mr. Oberting, effective as of February 9, 2019. The employment agreement has an initial three-year term and automatically extends for one-year terms, unless either party provides notice of non-renewal at least 90 days prior to the expiration of the then-current term. Under the employment agreement. Mr. Oberting will receive an annual base salary of not less than $500,000, increasing to $1,000,000 on January 1, 2020, and is eligible to receive an annual cash incentive with a target opportunity of no less than 50% of base salary, increasing to 100% of base salary on January 1, 2020. In connection with his promotion, on February 27, 2019, the Compensation Committeedetermined togranted Mr. Oberting a stock option awardour NEOs,with arestrictedgrant date value of $3,150,000, which will vest upon his continued employment through the third anniversary of the grant date, and a performance share unit equity awardin recognitionwith three-year, cliff-vesting and a target payout level oftheir efforts$1,350,000, with vesting terms consistent with the annual equity grants made to the other NEOs. The employment agreement binds Mr. Oberting to certain non-solicitation and non-competition restrictions during2018the term of his employment and forretention purposes. In determininga period of one year thereafter. If Mr. Oberting’s employment is terminated by the Company without cause or Mr. Oberting resigns for good reason, as such terms are defined in the employment agreement, he will receive a severance benefit equal toapprove these grants, the Compensation Committee considered, in particular, the highly performance based design of the Company's executive compensation program, with all long-term incentive awards subject to performance-based vesting conditions,one times his base salary immediately before his termination andthe desire to provideanadditional retentiveannual cash incentive for theManagement Committee. For more information about this award see "2018 NEO Compensation and Performance Summary."year of termination that is not less than his target annual cash incentive. In addition, if Mr. Oberting provides post-termination advisory services to the Company following such a termination or his retirement in order to facilitate27a transition to his successor, he will continue to vest in outstanding long-term incentive awards. The terms ofContentsBased on a November 2017 competitive analysis,Mr. Oberting’s employment agreement were determined after considering the input of the CompensationCommittee determined that a higher portion of Sirius Group's senior executive targetCommittee’s independent consultant, peer data and the compensationpay mix is "at-risk," in the form of annual cash bonus and long-term incentives, than that of many of Sirius Group's peer companies. Accordingly, our senior executive officers will generally earn less total compensation than those at our peer companies for comparable positions in times of poor financial performance, but tend to be well compensated on both an absolute and relative basis when we perform well. We believe that this approach has not only the effect of aligning management interests with thatarrangements of theowners, it is also a strong recruiting tool to attract candidates who are confident in producing outstanding results overprior CEO.Following Mr. Oberting’s appointment as CEO of thelong-term.Historically, Sirius Group's long term incentive programs have been cash-based in nature, with payout levels based upon performance metrics that we believe are objectively measurable and aligned withCompany, Mr. Salamone was appointed as CFO of thestrategic success of Sirius Group. For example, as a global (re)insurance company, the Compensation Committee believes underwriting discipline is a core tenet to long-term success in the market, and thus underwriting performance is a metric that influences the payout of these long-term awards. That said, an accounting metric that we believe is also a strong indicator of Company performance is growth in book value per share ("BVPS"), which tracks management of our shareholders' capital, and we believe is linked to shareholder value creation over the long-term as a public company. Accordingly, since our acquisition by CMIG International, the underlying value of long-term incentive awards granted to senior executives tracked BVPS. The amount of long-term incentive awards earned, if any, is determined based on achievement of pre-established financial performance criteria over each three-year performance cycle.Company. In connection with
the Merger, andthis appointment, Mr. Salamone received an increase in his base salary fromtime$400,000 totime, the Compensation Committee engages outside consulting specialists to evaluate Sirius Group's approach to compensation and to provide an assessment of the competitive market. See the "Competitive Analysis and Compensation Program Enhancements Commensurate with Public Listing" section below for additional information with respect to the foregoing.Summary of Our Executive Compensation PracticesThe table below highlights certain executive compensation practices we have implemented that drive performance as well as those not implemented because we do not believe they would serve our stockholders' interests.$500,000.What We DoWhat We Don't DoþWe tie pay to performance by designing a significant portion of executive pay to be at-risk, 92% of the CEO's 2018 compensation and, on average 78% of the other NEOs' compensation, is at-riskýReprice underwater stock options without stockholder approvalþWe mitigate undue risk in compensation programs through informed performance goal-setting that considers multiple financial and non-financial inputsýWe do not award stock options with an exercise price below 100% of fair market valueþWe retain the services of an independent compensation consultantýWe do not allow our directors, executive officers, employees and their related persons to pledge the Company's securities as collateral for loans or for any other purposeþWe generally consider market and industry data when setting executive pay, using the median as a reference point to understand the general marketýWe do not allow our directors, executive officers, employees and their related persons to hedge the Company's securitiesþWe offer double-trigger-change-in-control benefitsWhat We DoþOur performance share units have a three-year performance periodþWe maintain a clawback policy applicable to executive officers in the event of a financial statement restatementThe primary components of SiriusGroup's 2018Group’s 2019 NEO compensation are:1.Base Salary2.Annual CashBonusesIncentives
3.PerformanceLong-Term Incentive awards granted in the form of time based restricted shareawards under the 2016 Long Term Incentive Plan (the "2016 LTIP")units, performance share units andIPO Incentive Grantstock options under the 2018 Omnibus Incentive Plan4.Retention AwardsIn addition, as described further below, our NEOs participate in our corporate-widebenefitbenefits programs and receive perquisites and other benefits that we believe are commensurate with their positions and the competitive market.Base salaries are designed to provide basic levels of compensation to our NEOs based upon their experience, duties and scope of responsibilities. While Sirius Group emphasizes variable, long-term compensation, it pays base salaries because they provide a basic level of compensation at a level that we believe is appropriate to retain high-caliber executives. In2018,2019, SiriusGroup'sGroup’s NEOs received base salaries ranging from$450,000$465,000 to $500,000.With the exception of Messrs. Salamone and Davis, the base salary of the NEOs remained unchanged in 2019. The Compensation Committee determined to increase Mr. Salamone’s base salary by 25% in connection with his appointment as Chief Financial Officer of the Group in 2019 based on a review of market data, compensation received by Mr. Salamone’s predecessor at Sirius Group and the input of the Compensation Committee’s independent consultant. Mr. Davis received a 3% increase in connection with the Company’s annual merit increase process.The table below sets forth the 2019 base salary level for each of our NEOs as compared to the prior year. Mr. Waters’ base salary of $500,000 did not change asdescribed below undercompared to 2018 in light of his February 2019 departure.NEOs Base Salary
2018 Base Salary
2019 % Change Kernan V. Oberting $ 500,000 $ 500,000 0% Ralph A. Salamone $ 400,000 $ 500,000 25% Gene Boxer $ 500,000 $ 500,000 0% Monica Cramér Manhem $ 497,000 $ 475,000 0%* Jeffrey W. Davis $ 450,000 $ 465,000 3% *Ms. Cramér Manhem is paid in Swedish Krona. The year-over-year changes in her 2018 and 2019 base salary reflects fluctuations in the"currency exchange rates as of December 31, 2018NEO CompensationandPerformance Summary2019.28."Annual cashbonusincentive awards are designed to create a"pay-for-performance"“pay-for-performance” environment while providing competitive levels of compensation to our NEOs based upon their experience, duties and scope of responsibilities. Targetbonusescash incentives for our NEOs in20182019 equaled 50% of their respective base salaries.20182019 AnnualBonusCash Incentive DesignFor2018,2019, the target annualbonuscash incentive pool was$15.0$15.8 million for228242 participants, including the NEOs. The overall awardedbonuscash incentive pool size can range from 20% to 200% of target, depending upon SiriusGroup'sGroup’s performance as compared to each of theperformance goalsfinancial metrics and strategic objectives established for2018. The Compensation Committee retains authority to adjust the overall pool when it determines that overall performance is not reflected in the pre-established financial performance achievement criteria, for example in the case of a large strategic acquisition. If the threshold pre-established financial performance achievement criteria are not achieved, a minimum funding of 20% of the target bonus pool will be allocated among select participants who were determined to have made unusually significant contributions during the year.2019.For the
20182019 annualbonuscash incentive program, there werethree objective andtwo quantitative financial performance metrics established by the Compensation Committee, as set forth in the tablebelow. If target performance was met, payout would be 100%below and six strategic corporate objectives, with the financial and strategic objectives each weighed 50%. The strategic objectives were introduced in 2019 and are designed to incentivize the NEOs to achieve strategic objectives during the financial year. Performance against strategic objectives is evaluated during the first quarter oftarget with athe following year. For each of the financial metrics and the overall strategic objectives, payouts can rangeoffrom 20% to 200% of target. The financial metrics are measured formulaically, whereas the achievement of the strategic objectives are measured on a qualitative basis after a discussion between management and the Compensation Committee following the completion of the previous fiscal year.2019 Strategic ObjectivesIn early 2019, the Compensation Committee approved six qualitative strategic objectives outlined below. The NEO and Company performance objectives in 2019 were as follows:•Increase float and/or achieve significant M&A•Simplify our management structure around our segments to promote efficiency•Simplify our corporate entity structure and reduce regulatory overlap and improve capital efficiency•Achieve individual business profitability•Achieve $10 million in run rate savings•Increase relative Return on Equity (“ROE”) of the Company versus its peersIn early 2020, Mr. Oberting discussed his assessment of the performance of each NEO (other than himself) with the Compensation Committee. The Compensation Committee then met in executive session to consider Mr. Oberting’s performance, as well as his recommendations with respect to the other NEOs and to make final payout determinations.After reviewing Mr. Oberting’s recommendations, the Compensation Committee, determined that forperformance between thresholdthe qualitative strategic objectives of the annual cash incentive pool, the funding would be set at 90% achievement. Although 2019 results for most business units were lower than expected in part due to extreme catastrophe insured losses, the Compensation Committee believed that the NEOs successfully achieved a significant portion of the objectives within their control, including with respect to “year one” of Sirius Group’s multi-year transformation as follows:•We reoriented the management structure to focus on segment centric profitability andmaximum.publicly announced the new management structure in August 2019;
•We globalized our corporate functions to support our business segment realignment;•We simplified our legal entity structure, reduced regulatory overlap and improved capital efficiency and investment flexibility;•We achieved $10 million in run rate expense savings; and•We had varying results in achieving individual business unit profitability with Global A&H being our most profitable segment in 2019.29While the Company did not increase its float and/or achieve significant M&A during the 2019 calendar year, the Compensation Committee believed that this was largely outside the control of the NEOs given the ownership structure and dynamics around how such ownership structure has impacted the Company’s stock price.2019 Financial Performance ObjectivesThe following table sets forth the pre-established financial performance criteria and the weighting for each of the NEOs under the2018formulaic portion of the 2019 annualbonus program:cash incentive program which was weighted 50%: Weighting(3) 2019 Financial Performance Metrics Threshold
(20% Payout) Target
(100% Payout) Maximum
(200% Payout) Oberting,
Boxer, Davis
& Salamone Cramér
Manhem ABVPS(1) (% achieved) 0.4% 7.4% 14.4% 100% 25% UROAE(2) (% achieved) 0.7% 7.7% 14.7% 0% 75% Weighting(4) 2018 Performance MetricsThreshold
(20% Payout)Target
(100% Payout)Maximum
(200% Payout)Waters,
Oberting,
Boxer and DavisCramér
ManhemUROAE(1) (% achieved)
1.9 % 8.9 % 15.9 % 20 % 70 % ROAE(2) (% achieved)
1.9 % 8.9 % 15.9 % 70 % 20 % Asia Technical Profit(3) ($m achieved)
$ 15 $ 18 $ 21 10 % 10 %
(1)(1)Adjusted Book Value Per Share (“- ABVPS”) is derived by dividing adjusted book value by the adjusted shares outstanding. Adjusted shares outstanding is derived by summing common shares outstanding, Series B preference shares outstanding, and the earned portion of share-based compensation awards. Adjusted book value is derived by summing total common shareholders’ equity, the Series B preference share amount reflected in mezzanine equity, and the earned portion of future proceeds from stock option awards. Outstanding warrants are excluded as they are anti-dilutive as of the respective reporting dates.
(2)Underwriting Return on Average Equity("(“UROAE"”) is a measure driven principally by bottom-line underwriting profits and transaction gains, net of operating expenses, plus a standardized investment return on capital and float, measured against full legal entitycapital (same as ROAE, as described below).capital. UROAE differs from Underwriting Return on Capital("(“UROC"”) used inprior yearsthe 2017- 2019 LTIP in that it is measured on full legal entity capital, as opposed to deployed capital.(3)(2)Return on Average Equity ("ROAE") is calculated as follows: (50% GAAP Comprehensive Income plus 50% GAAP Net Income) divided by time-averaged common shareholders' equity. Both Comprehensive Income and Net Income include gains and losses from acquisitions. Time-averaged common shareholders' equity equals beginning equity plus time-weighted capital contributions during the year less time-weighted capital distributions during the year plus simple average of accumulated profit (loss) during the year.(3)This metric measures technical underwriting profits in broader Southeast Asia (excludes India and Japan), including all insurance policies issued in this territory where Sirius is the insurance carrier, as well as fee income profit in the Company's managing general underwriter subsidiaries after relevant cost deductions sourced in these countries.(4)The Compensation Committee determined in20182019 that the incentive compensation paid to Ms. Cramér Manhem, as the executive management head of the underwriting group, would be more heavily weighted by underwriting profits.AnnualBonusCash Incentive Results![[MISSING IMAGE: tm2035095d1-fc_annual4c.jpg]](https://files.docoh.com/DEF 14A/0001104659-20-122496/tm2035095d1-fc_annual4c.jpg)
Financial results for20182019 wereunfavorable due to catastrophe losses.lower than expected and lower than the targets noted above. The primary compensation metrics for the annualbonuscash incentive program for20182019 wereUROAE, ROAE,Growth in ABVPS andAsian Technical Profit. Since the UROAE performance, the ROAE performance,UROAE. For 2019, ABVPS decreased andAsian Technical Profits performance werewas below the minimumthresholds,threshold. Actual UROAE achieved was approximately 0%, similarly below theoverall weighted averageminimum threshold. Accordingly, the financial performance portion of the2018 bonus pool was below its threshold for funding above the 20% minimum amount; therefore, the 2018 bonus poolannual cash incentive was funded at the minimumamount20% funding level. This portion of20%the annual cash incentive was combined with the relevant achievement of the strategic objectives for each respective NEO as noted below; resulting in the 2019 cash incentive pool being funded at 55% of target. Based on performance, the Compensation Committee allocateda portion$1,062,340 of theminimum bonuscash incentive pool toeach of theour NEOs, with individual NEOs receiving allocations based on: (i) thefour Management Committee members using all or some portion ofoverall pool funding for Mr. Oberting, (ii) the relative segment and underwriting performance for Ms. Cramér Manhem, and (iii) function and individual performance for Messrs. Salamone, Boxer and Davis. Mr. Waters’ separation agreement provided that hisor her bonus to fund a special bonus program for employees at the Company, as discussed belowannual cash incentive would be no less than his target cash incentive opportunity.30 Target Cash Incentive
Opportunity Actual Cash Incentive Paid NEO Actual % of Base
Salary ($) As a % of Target
Cash Incentive
Opportunity ($) Kernan V. Oberting 50% $ 250,000 55% $ 137,500 Ralph A. Salamone 50% $ 250,000 80% $ 200,000 Gene Boxer 50% $ 250,000 90% $ 225,000 Monica Cramér Manhem 50% $ 237,500 32% $ 75,840 Jeffrey Davis 50% $ 232,500 75% $ 174,375 Allan Waters 50% $ 250,000 100% $ 250,000 The objectives for Sirius Group’s long-term incentive program are to:•Align the interests of our executives with the interests of our shareholders by focusing on objectives that support stock price appreciation;•Increase cross-functional executive focus in the coming years on key performance metrics through performance share units; and•Retain the services of executives through multi-year vesting provisions.Sirius Group’s long-term incentive program allows the Compensation Committee to award various forms of long-term incentive grants, including stock options, time-based restricted share units, performance-based equity and performance-based cash awards. The Compensation Committee approves all equity grants made to our senior executives.2018 Omnibus Incentive Plan Awards — 2019 Equity AwardsIn determining the 2019 long-term incentive award levels for NEOs, the Compensation Committee compared the target total direct compensation of each NEO to the competitive market median. In addition, the Compensation Committee evaluated the expected payouts of its current long term incentive awards. Consistent with the Company’s long-standing compensation philosophy of aligning executive officers’ interests with shareholders through the risks and rewards of equity ownership and balancing such risk and rewards with the Company’s need to retain its talented and experienced executive team during a time of the Company’s transformation from a private Company to a public Company, the Compensation Committee determined to award, on average, approximately 72% of the total target direct compensation of each of our NEOs in the form of equity awards.The table below sets forth the target award value, as of the date of grant, of the long-term incentive award received by each NEO under our 2019 long-term incentive program, which was delivered 30% in performance share units and 70% in time based restricted share units for all NEOs, except Mr. Oberting. The Compensation Committee approved a higher percentage of the long-term incentive award in the form of restricted share units as compared to the Company’s peers in 2019 given the significantly lower recent long-term incentive payout values and projected payout values of long-term incentive compensation paid to our NEOs relative to the named executive officers of the Company’s peers. Mr. Oberting received 70% of his award in stock options and 30% of his award in performance share units.NEO Targeted Grant
Date Value
of 2019 Long
Term Incentive
Award Kernan V. Oberting(1) $ 4,500,000(1) Ralph A. Salamone $ 1,350,000(2) Gene Boxer $ 1,350,000(2) 31NEO Targeted Grant
Date Value
of 2019 Long
Term Incentive
Award Monica Cramér Manhem $ 1,350,000 (2) Jeffrey W. Davis $ 1,027,000(2) (1)The grant date value of Mr. Oberting’s stock option award was $3,150,000 and the performance share unit award was $1,350,000. The option award cliff vests on the third anniversary of the grant date and the performance share unit award is subject to three-year cliff vesting based on performance and continued service through the end of the performance period.(2)The grant date value of the time based restricted share units granted to Messrs. Salamone, Boxer and Ms. Cramér Manhem was $945,000 of time based restricted share units and $405,000 performance share units, and with respect to Mr. Davis, $719,000 and $308,000, respectively. The time based restricted share units cliff vest on the third anniversary of the grant date and the performance share unit awards are subject to three year cliff vesting based on performance and continued service through the end of the performance period.Performance Share Units. The 2019 performance share unit awards will vest if and only to the extent that specific performance goals relating to growth in ABVPS and UROAE are met during the 2019-2021 performance period. The Compensation Committee selected ABVPS and UROAE because it believed that these metrics are aligned with the Company’s business plans.Under the terms of the 2019 performance share unit awards, vesting may range from 0% to 200% of target based on the Company’s performance with respect to the pre-established performance goals. Except as otherwise described in the — 2019 Potential Payments Upon a Termination or a Change in Control, in order to vest in the award, the award recipient must generally remain employed through the end of the performance period. The performance goals for the performance share units were designed to be challenging but achievable with the coordinated, cross-functional focus and effort of the executives.Restricted Share Unit Awards. Time-vesting restricted share unit awards were granted to our NEOs (other than Mr. Oberting) as part of the annual long-term incentive grants to support retention and alignment of our NEOs’ interests with the interests of our shareholders. The annual restricted share unit awards cliff vests on the third anniversary of the grant date, subject to the NEO’s continued service or as otherwise provided for under the award agreements.Stock Option Award. In connection with his appointment to the position of CEO, Mr. Oberting received a stock option award having a grant date value of $3,150,000 as part of his 2019 long-term incentive award, which will cliff vest upon his continued employment through the third anniversary of the grant date. The stock option award was granted to Mr. Oberting to further emphasize the achievement of long-term objectives and encourage long-term value creation because the stock options will have value to Mr. Oberting only if the Company’s stock price appreciates from the date of grant. The Compensation Committee believes that Mr. Oberting’s 2019 long-term incentive design supports retention and represents a balanced reflection of shareholder returns and financial performance.Prior Equity AwardsSirius Grouphashistorically awarded long-term incentive compensation in the form of three-year, cliff-vested, performance units or phantom performance shares that can be paid in cash, or upon Sirius Group becoming public, Sirius Group common shares, at the discretion of the Compensation Committee. A new long-term incentive awardiswas granted each year so that thereare three differentwere multiple performance cycles outstanding at any given time.The2016-20182017 – 2019 and2018-20202018 – 2020 grants were governed by theSirius Group Long Term Incentive Plan (the "2016 LTIP,"),and were granted in the form of phantom performance shares based upon the BVPS of Sirius Group on the date of grant and earned (or"“harvested"”) based on specific, objective financial performance measures established at the beginning of the three-year performance cycle.Each phantom performance share is valued at BVPS at the end of each performance cycle for payouts when our common shares are not publicly traded. Now that our common shares are publicly-traded, upon theUpon vesting of awards made under the legacy 2016 LTIP, (i) each phantom32performance share will be valued at the market price of a common share at time of payout and (ii) the Compensation Committee has discretion to settle these awards in common shares rather than cash.In February 2019, the Compensation Committee granted participants, including the NEOs, the option to settle their 2016-2018 performance share awards in either cash or common shares.Based on advice received from Frederick W. Cook & Co., Inc. ("FW Cook"), the Compensation Committee's independent compensation consultant, and the recommendation of the Compensation Committee, and following the approval of the Board and existing shareholders, on August 6, 2018, Sirius Group adopted the 2018 Omnibus Incentive Plan. The 2018 Omnibus Incentive Plan is designed to enhance the value of Sirius Group by enabling it to offer eligible employees, directors and consultants cash and stock-based incentive awards in order to attract, retain and reward these individuals and align the long-term interests between them and Sirius Group's shareholders. The 2018 Omnibus Incentive Plan replaced the 2016 LTIP with respect to new equity grants.2016 LTIPFor the three-year performance cycle beginning in
2018,2017, the performance metrics and relative weightings for the NEOs werethe same as the annual bonus program. The Compensation Committee determined that the annual bonus programUnderwriting Return on Capital (“UROC”), Average ROE, Total Assets Average Growth andlong term incentive awards should have the same performance metrics in 2018 because this would create a simpler incentive program with the key financial metrics that drive shareholder value creation. Furthermore, the annual bonus program was based on one-year performance and the long term incentive program was based on three-year performance.Chinese Premium Growth. The number of phantom shares earned can range from 0% to 200% of the target number granted based onproscribedprescribed threshold, target and maximum performance levels.Given the economic and market conditions at the time the 2018 targets were set, the target payout levels were designed to be challenging but achievable, while payouts at the maximum levels were designed to be "stretch" goals.The table below provides the number of Sirius Group common shares that may be issued assuming payout at the target and maximum performance levels in respect of all outstanding LTIP awards as of December 31, 2018, including outstanding NEO LTIP awards, for pending LTIP award cycles.2017 – 19 LTIP Payouts as a % of Target Threshold Target Maximum Average Underwriting Return on Capital(1) 2.5% 9.5% 16.5% Average Return on Equity(2) 0.7% 7.7% 14.7% Total Assets Average Growth(3) 0% 63% 126% Chinese Premium Growth(4) 0% 40% 80% Common Share
Issuance at 100%
Vesting LevelMaximum
Potential
Vesting LevelCommon Share
Issuance at Maximum
Vesting Level2016 - 18
813,995 290 % 2,360,586 2017 - 19
855,588 200 % 1,711,176 2018 - 20
910,049 200 % 1,820,098 Total Potential Common Share Issuance
2,579,632 5,891,860 2016-18 LTIP AwardsFor the Sirius Group performance shares issued for the 2016-18 performance cycle, each performance share was based on a value of $16.33 at the beginning of the three-year performance cycle, with the value of each unit growing or diminishing based on Sirius Group's BVPS as a private company, which switched to Market Value per Share ("MVPS") upon becoming a public company in November 2018. The payouts were to be between 0% and 290% based upon Underwriting Return on Capital and Return On Equity performance relative to target, with each goal equally weighted for the NEOs and a premium growth modifier applied to determine payout levels. Each NEO had the option to elect to settle the 2016-2018 performance share cycle in either cash or common shares of the Company. A summary of the 2016-2018 performance share cycle for each performance metric is as follows:Underwriting
Return on Capital(2)2016 - 18 LTIP Payouts as a % of Target2.25% 9.25% 16.25% Annualized Gross Written Premium Growth in O.C.(1)
(5 )% 0 % 80 % 160 % 5 % 20 % 100 % 200 % 20 % 30 % 145 % 290 % Return on Equity(3) 2016 - 18 LTIP Payouts as a % of Target0.7% 7.7% 14.7% Annualized Gross Written Premium Growth in O.C.(1)
(5 )% 0 % 80 % 160 % 5 % 20 % 100 % 200 % 20 % 30 % 145 % 290 % (1)Original Currencies.(2)Underwriting Return on Capital ("Average UROC")represents the after-tax, leveraged underwriting return on average"Deployed Capital"“Deployed Capital” in the Sirius Group. For purposes of this performance metric,"“Deployed Capital"” is defined as GAAP capital less excess rating agency capital plus an internal safety margin. GAAP comprehensive income results are adjusted to reflect: (i) reduction of investments equal to un-deployed capital; (ii) application of a standard investment crediting rate on remaining investment assets; (iii) removal of the impact of currency fluctuations; and (iv) adjustment of income taxes related to (i), (ii) and (iii). Average UROC is determined by determining the simple average of the UROC from each of 2017, 2018, and 2019 performance years.
(2)(3)Return on Equity ("Average ROE")is calculated as follows: (50% GAAP Comprehensive Income plus 50% GAAP Net Income) divided by time-averaged commonshareholders'shareholders’ equity. Both Comprehensive Income and Net Income include gains and losses from acquisitions. Time-averaged commonshareholders'shareholders’ equity equals beginning equity plus time-weighted capital contributions during the year less time-weighted capital distributions during the year plus simple average of accumulated profit (loss) during the year.(3)Total Assets Average Growth refers to the yearly average growth percentage from January 1, 2017 to December 31, 2019 and is determined by dividing the 2019 ending total assets by the 2017 beginning total assets.(4)Chinese Premium Growth refers to yearly average growth percentage measured in Renminbi from January 1, 2017 to December 31, 2019 and is determined by dividing (i) the difference of the 2019 Chinese Premium and the 2016 Chinese Premium by (ii) the 2016 Chinese Premium.The following table sets forth the weighting of the various performance measures for each of the NEOs:NEO Average
UROC Average
ROE Total
Assets
Average
Growth Chinese
Premium
Growth Kernan V. Oberting 25% 25% 40% 10% Ralph A. Salamone 50% 50% 0% 0% Gene Boxer 50% 50% 0% 0% Monica Cramér Manhem 25% 25% 40% 10% Jeffrey W. Davis 50% 50% 0% 0% Allan C. Waters 25% 25% 40% 10% Based upon a three-year average UROCof 2.6%andbelow-thresholdROE performancecombinedwere below threshold, while Total Assets Average Growth achieved 12.8% of target and Chinese Premium Growth performed at 48.9% of target. As a result, with19.3% growth in premiums, all fivethe exception of Messrs. Oberting and Waters and Ms. Cramér Manhem, the NEOsreceiveddid not receive payouts for the three-year performance cycle based on the formulaic payout percentageof 32.6% applied todescribed above. The following table sets forth the value received by each oftheir units, which had a value of $12.75 attheend ofNEOs with respect to thethree-year2017 – 2019 performance cycle.Messrs. Waters and Oberting used all or some portion of their respective payouts to fund a special bonus program for certain employees ofThe Compensation Committee determined that theCompany who do not participate2017 – 2019 performance share awards would be settled inthe Company's long term incentive program, as discussed below. Each of the participating NEOs elected to receive common shares of the Company, except for Mr. Waters who elected to take cash, as described in "2018 NEO Compensation and Performance Summary."cash.33NEO Payout Value of
2017 – 2019
Long Term
Incentive Award Kernan V. Oberting $ 78,375 Ralph A. Salamone $ 0 Gene Boxer $ 0 Monica Cramér Manhem $ 37,749 Jeffrey W. Davis $ 0 Allan C. Waters $ 181,552 Table of ContentsIn November 2018, the members of the Management Committee each agreed to personally fund a pro rata portion of a special bonus of approximately $286,000 that was paid to certain employees who do not participate in the Company's long-term incentive program (the "Special Bonus"). The allocation of the funding of the Special Bonus among the Management Committee was based upon the vesting of the respective NEOs' 2016-2018 LTIP awards, and was funded from the vesting of such award and/or or their annual cash bonus payment. Because the NEO's participate in the Company's long-term incentive program, they did not receive any portion of this Special Bonus.2016 LTIP AmendmentIn 2018, the 2016 LTIP was amended to provide for continued vesting in the case of a termination by the Company without cause or by the participation for good reason, other than during the 24-month period following a change in control. For these qualifying terminations of employment, our NEOs will continue to vest in outstanding awards for 12 months following a termination of employment. The ability to receive payments during these vesting continuation periods will be subject to actual performance and compliance with applicable restrictive covenants. For more information about the treatment of performance awards upon a termination of an NEO under the 2016 LTIP, please see the section entitled "2018 Potential Payments Upon a Termination or a Change in Control—2016 LTIP."2018 Omnibus Incentive Plan Awards — IPO Incentive Program
In connection with the Merger, the Compensation Committee approved grants of performance share unit awards to members of management, including the NEOsunder the 2018 Omnibus Incentive Plan(the"“IPO Incentive Program"”). The IPO Incentive Program was designed to further align the compensation of a select group of executives of Sirius Group, including our NEOs, with the long-term performance of SiriusGroup'sGroup’s common shares following the Merger and shareholder interests.The aggregate number of shares subject to these awards, determined at the target level of performance, had an initial grant date value of $15 million, based on the per share value of Sirius Group common shares at the closing of the Merger (the "IPO Price"), with the portion of these awards allocated to the members of the Management Committee having a value of $8.7 million. The awards ultimately granted under the IPO Incentive Program at a target level of performance had an initial grant date value of $14 million, and the portion of the awards allocated to the members of the Management Committee was subsequently reduced to $7.7 million. The IPO Incentive Program grants (each award, an "IPO Incentive Grant") were allocated to the NEOs as follows, based on the grant date value of the award at target levels of performance:NEOGrant Date Value of
Target Award
(as amended)Allan L. Waters
$ 2,200,000 Other Management Committee members (Mr. Oberting, Ms. Cramér Manhem and Mr. Boxer)
$ 1,600,000 Jeffrey W. Davis
$ 700,000 One fourth of the number of these performance share units granted to each participant under the IPO Incentive Program will become earned and vested based on ROE performance goals approved by the Compensation Committee with respect to each of 2019, 2020 and 2021, and an additional one-fourth of the number of performance share units will become earned and vested based on Sirius
Group'sGroup’s average annual ROE performance over 2019, 2020 and 2021. The vesting of the awards will also be subject to theparticipant'sparticipant’s continued employment with Sirius Group through the end of the applicable performance period, provided that a participant who has a qualifying termination of employment will become vested in a prorated portion of the award earned in the then-current performance period, subject to actual performance results. The performance goals were designed to be challenging but achievable with strong management and Company performance.TableBased on the Company’s attainment ofContentsAs a condition toROE below thereceipt ofminimum threshold for 2019, theperformance share units, each participant was required to purchase a number of common shares equal toNEOs did not vest in thetarget number of shares that are subject to the performance share unit award granted by Sirius Group, rounded down to the nearest 100 shares (the "Purchase Obligation"). The plan contemplated that the purchased units would not be subject to any vesting conditions, but will be subject to the holding requirements discussed below. A participant could have either elected either to purchase all of the shares in 2018 or to purchase the shares in three annual installments, by March 31,20192020 and 2021, respectively. If the shares were purchased in 2018, the purchase price would have been the IPO Price. If the shares were purchased in three annual installments, one third of the shares must have been purchased in each of the three years at the IPO Price for shares purchased by March 31, 2019, 105%portion of the IPOPrice for shares purchased by March 31, 2020Incentive Program and112%such portion was forfeited.Retention AwardsTime Based Restricted Share Unit AwardsDuring 2019, the Compensation Committee evaluated the compensation program and determined that there were some concerns regarding the structure of theIPO Priceprogram. While the Compensation Committee strongly believes that the compensation should be weighed heavily on performance, it found that the incentive compensation realized by and the forecasted long-term compensation payout values under outstanding awards forshares purchasedour NEOs were significantly lower than compensation realized byMarch 31, 2021.Purchased shares could not be transferred or sold priornamed executive officers of peer companies, even when factoring the Company’s performance relative toDecember 31, 2021, for so long as the participant is employed, and performance share units that are earned and vested will not be issued to the participant until after the determination of performance following the conclusion of 2021.Based on the input of FW Cook and our controlling shareholder, at the time, we believed that this type of one-time equity grant was typical for companies undertakingpeers. As amerger involving a public offering or similar significant strategic transaction resultingresult, ina structural change in operating structure. Additionally, the performance conditions as well as the purchase and holding requirements were designed to further align the management team with Sirius Group's shareholders. However, in Februaryearly 2019,based upon further discussions with FW Cook,the Compensation Committee determined toamend the IPO Incentive Program to offer participants, includingaward the NEOs additional time-based restricted share units as a supplemental retentive award. This restricted share unit award cliff vests on theopportunity to remove the Purchase Obligation in exchange for waiving the existing right to purchase common sharesthird anniversary of theCompany at pre-determined prices.grant date, subject to continued employment through the applicable vesting date. These awards were granted in recognition of their efforts during 2018 and for retention purposes.Inorderdetermining toensure that the pay for performance alignment of the program was unchanged,approve these grants, the Compensation Committeedid not amendconsidered, in particular, theexistinghighly performancevesting conditions. The Compensation Committee approved these amendmentsbased design of the Company’s executive compensation program, withthe understanding that participants in the IPO Incentive Program did not have sufficient liquidity from their existingall historic long-term incentive awards subject tofundperformance based vesting conditions, and thePurchase Obligation duedesire to provide an additional retentive incentive for the NEOs.34The table below sets forth the grant date fair value of the February 2019 restricted share unit awards:NEO Grant Date Value of
2019 Supplemental
Restricted Share Unit
Awards Kernan V. Oberting $ 200,000 Ralph A. Salamone $ 240,000 Gene Boxer $ 300,000 Monica Cramér Manhem $ 198,645 Jeffrey W. Davis $ 135,000 Cash Retention AwardsIn November 2019, the Compensation Committee requested that its independent consultant evaluate actual realized pay of our NEOs and compare it to theanticipated payouts expected intargeted pay set by theupcoming long term incentive plan payout cycles,Compensation Committee for 2019 as well as thesignificant discountpeer data. The analysis noted that the ratios of realized to target long term incentive compensation and realized to target total direct compensation for Sirius Group’s CEO and CFO were both low relative to peer companies. In addition, the November 2019 study found that the compensation program for our senior executives is generally more variable than that at many of our peer companies. Specifically, the salaries and other fixed compensation components of Sirius Group’s senior executives tend to be somewhat lower than that of Sirius Group’s peers, while variable compensation opportunities tend to be greater than the average of Sirius Group’s peers. Additionally, incentive compensation realized by and the forecasted long-term incentive compensation payout values under outstanding awards for our NEOs was significantly lower than named executive officers of peer companies, even when factoring the Company’s performance relative to peers. Given the changes to thecurrent market value.business circumstances, the Compensation Committee sought to ensure the continued service of our NEOs. Based on these factors, the Compensation Committee determined that special cash retention awards were necessary in order to continue to incentivize and retain executives. The Compensation Committeebelievesdelegated authority to the CEO to determine cash retention awards to be paid over a period of time to our NEOs, other than Mr. Oberting. Awards under the program have vested or will vest in equal installments on or prior to March 15, 2020 and March 15, 2021, subject to continued employment through the applicable vesting date. In the event of a termination of employment without cause (as defined in the applicable award agreement) or, in the case of participants in the Sirius Group Severance and Change in Control Plan, a resignation for good reason (as defined in the Sirius Group Severance and Change in Control Plan) prior to either vesting date, the vesting and payment of the full award will be accelerated. In the event of a termination of employment for any reason other than a termination without cause or, if applicable, a resignation for good reason, any unvested portion of the award will be forfeited and any portion of the award vested within 12 months prior to such termination or resignation will be required to be repaid.In determining to grant these cash awards, the Compensation Committee considered the impact on the “at risk” compensation of the Company from the recent severity of natural disasters, including Hurricanes Irma, Michael and Dorian, California wildfires, and Typhoon Jebi, among others, resulting in extreme catastrophe insured losses. We believe thatthese amendments reflect a more typical initial public offering incentive program as required share purchaseseach of the NEOs are critical to our ongoing success and to achieve our goals. In addition, we believe that the pool of candidates that meet our criteria is small and that compensation for talent has increased during recent years. In light of this, the continued employment of our NEOs is critical to the Company and thus, the Compensation Committee granted the cash retention awards to all NEOs (except Mr. Oberting) in order toparticipateensure the continuity of service to our Company by talented executives during this time. At the time, the Compensation Committee deferred approving Mr. Oberting’s cash retention award. In February 2020, after an evaluation of Mr. Oberting’s outstanding long term incentive awards and determining that the projections of actual payout were only 6% of target, the Compensation Committee determined to award Mr. Oberting a cash retention award equal to 68% of his 2019-2021 long term incentive grant in an amount of $3,060,000 under theprogram are uncommon.same payment and other conditions noted above with respect to the other NEO’s previously granted cash retention award.
35The table below sets forth the cash retention awards granted to certain of our NEOs in November 2019 and February 2020:NEO Cash Retention
Award Kernan V. Oberting $ 3,060,000 Ralph A. Salamone $ 800,000 Gene Boxer $ 1,000,000 Monica Cramér Manhem $ 800,000 Jeffrey W. Davis $ 800,000 Employment Agreements/Executive Severance PlanPrior to the Merger, Mr. Waters and Ms. Cramér Manhem entered into employment agreements in July 2015, which were entered into in conjunction with our acquisition by CMIG International. In January 2019, Mr. Oberting entered into an employment agreement with the Company in connection with his appointment as CEO. These employment agreements granted certain rights for termination without cause and other customaryrights, which the other NEOs did not have.rights. See the"“Employment Arrangements"” and"“20182019 Potential Payments Upon a Termination or a Change in Control"” sections below for a more detailed discussion of these employment agreements and estimate of the potential compensation and benefits provided pursuant to these arrangements.In September 2018, Sirius Group adopted the Sirius Group Severance and Change in Control Plan (the
"“Executive Severance Plan"”)which required, as a condition to receiving the benefits, the execution of a restrictive covenant agreement,which provides for terms applicable to each of our NEOs relating to severance and post-employment benefits provided upon certain termination events. As a condition of participation under the Executive Severance Plan, participants are required to execute a restrictive covenant agreement. The terms of the Executive Severance Plan were determined after consulting with the CompensationCommittee'sCommittee’s independent consultant, FW Cook, regarding market practices. The Compensation Committee believes that the Executive Severance Plan is competitive with typical industry practices and that the severance opportunities provide appropriate levels of compensation for executive separations. Further, the Compensation Committee believes that these arrangements are an important component of our compensation packages in terms of attracting and retaining top caliber talent in senior leadership roles and in defining terms and conditions of executive separation events.AsEach ofDecember 31, 2018, Messrs. Boxer and Davis and Ms. Cramér Manhem, and as of February 2019, Mr. Oberting,our NEOs has executed participation agreements under the Executive Severance Plan. Mr. Waters elected not to participate in the Executive SeverancePlan.Plan, and severance paid out to him in connection with his separation was made under the terms of his employment agreement.The Executive Severance Plan provides that, to the extent that Mr. Oberting or Ms. CramérManhem'sManhem’s employment agreements provide additional severance protections, they will each continue to receive the employment agreement severance protections, to the extenttheysuch protections do not result in duplicative benefits under the Executive Severance Plan.For a discussion of the benefits awarded to NEOs in the event of a qualifying termination under the Executive Severance Plan, see the section entitled"“20182019 Potential Payments Upon a Termination or a Change inControl—Control — Executive SeverancePlanPlan.."”Retirement BenefitsSirius Group maintains a tax qualified 401(k) plan for our U.S. employees, including Messrs. Waters, Oberting, Boxer, Salamone and Davis. Additionally, Ms. Cramér Manhem participates in a Swedish statutory pension scheme and, consistent with competitive practices in Sweden, receives supplemental retirement benefits from Sirius Group in the form of annual contributions to a non-qualified deferred compensation program. The Compensation Committee believes these benefits encourage retention and are part of delivering an overall competitive pay package necessary to recruit and retain talented executives. Please refer to the"“20182019 Summary Compensation Table,," "” “20182019 Nonqualified Deferred Compensation"” table and related footnotes for additional information.36PerquisitesSirius Group provides the NEOs certain perquisites that the Compensation Committee believes are generally consistent with those provided to executives at similar levels at companies within our industry. The Compensation Committee believes that providing certain additional perquisites to our NEOs enhances retention while strengthening our relationships with our NEOs. In addition, certain of our NEOsreceivereceived housing allowances relating to their service inBermuda. We believe that providing theseBermuda, which housing allowancesis necessarywere terminated inorder to attract and retain executive officers located in Bermuda.2019. Please refer to the"“20182019 Summary Compensation Table"” and related footnotes for additional information.
Other BenefitsTableOur NEOs participate in our corporate-wide benefit programs. Our NEOs are offered benefits that generally are commensurate with the benefits provided to all ofContentsour full-time employees. Please refer to the “2019 Summary Compensation Table” and related footnotes for additional information.
Other Executive Compensation MattersCompensation CommitteeThe Compensation Committee is responsible for determining and approving the individual elements of total compensation paid to the CEO and our other executive officers and for administering compensation practices affecting such other employees of the Company as the Compensation Committee deems appropriate, including the methodologies for determining employee and executive officer incentive compensation. The Compensation Committee also oversees the administration of executive compensation plans and certain employee benefits.At the time of the public listing, our board of directors appointed Ms. Keller and Messrs. Frucher and Rogers as members of the Compensation Committee, with Mr. Rogers serving as Chair of the Compensation Committee, and determined that each of the members of the Compensation Committee are independent, in accordance with applicable listing standards of Nasdaq.Our CEO annually presents the Compensation Committee with his evaluation of our executive officers (other than himself), considering their individual performances, responsibilities, and the contributions they made to theCompany'sCompany’s accomplishments and his expectations for their future performance and succession plans. In connection with this evaluation, the CEO presents the Compensation Committee with his recommendations for the compensation of these executives. The Compensation Committee sets executive officer compensation, considering theCEO'sCEO’s recommendations as well as its own assessment of performance.Clawback PolicyIn November 2018, the Board voluntarily adopted a recoupment or"clawback"“clawback” policy. In the event that during the 12-month period following the filing with the SEC of Company financial statements that are later the subject of a material negative restatement (a"“Restatement"”), the Board may, and to the extent legally permitted, require the return, repayment or forfeiture of any annual or long-term incentive compensation payment or award (including any cashbonusincentive or equity-based award) if:•the payment or award was predicated upon achieving certain financial results that were subsequently the subject of the Restatement;••the Board determines that the executive officer engaged in misconduct (including having actual knowledge of misconduct on the part of any other employee of the Company) that significantly contributed to the need for the Restatement; and••a lower payment or award would have been made to the executive officer based upon the restated financial results.Policy on Hedging Transactions, Margin Accounts and PledgingIn November 2018, the Board adopted an Insider Trading and Confidentiality Policy (the"“Insider Trading Policy"”). The Insider Trading Policy prohibits directors, employees, executive officers, and their respective family members who share their household from entering into hedging or monetization transactions or similar arrangements with respect to common shares of the Company, including the purchase or sale of puts and calls or the use of any other derivative instrument. In addition, the Insider Trading Policy prohibits directors, employees, executive officers and their respective family members who share their household from holding securities of the Company in a margin account or pledging securities as collateral for a loan.372018 NEOCompensation andPerformance Summary
Risk ManagementThe Compensation Committee evaluates the relationship between our executive and company-wide compensation programs and policies and risk management on an annual basis. As discussed in this CD&A, we design our compensation program to incorporate a range of components that we believe help to mitigate potential risks while rewarding employees for pursuing our strategic and financial objectives through appropriate risk taking, risk management and prudent tactical and strategic decision making. Senior executives representing our risk, legal and compliance, human resources, finance and audit functions, are each involved in the review process, which is conducted under the oversight of the Compensation Committee. Based on this review, we do not believe that there are any risks arising from our compensation policies and practices for our employees that are reasonably likely to have a material adverse effect on us.For additional information regarding our risk management practices, see “OverviewBoard Role over Risk Oversight.”Guidance from Independent Compensation ConsultantFW Cook provides executive compensation consulting services to the Compensation Committee. In 2019, FW Cook provided:•services related to the review of2018 Results2019 peer group compensation data,•awards under our long-term incentive program,•Underwritingthe setting of performance goals in our variable incentive plans including the payout leverage for resultsfor 2018 were negative reflecting multiple catastrophes around the globe. Sirius Group's key underwriting return metricabove andoverall return on equity werebelow theminimum payouttarget performance levels,for•an analysis of theyear. Despite this financialrelationship between the Company’s pay and performancewe believe that Sirius Grouprelative to peers, trends and tax and regulatory developments with respect to executive compensation,•our compensation peer group,•the compensation adjustments madesignificant progress positioning itself for the future by closing the Merger with Easterly Acquisition Corp., publicly listing on the Nasdaq Global Select Market, increasing shareholder diversification led by four globally recognized investment firms, and recruiting a strong, majority independent board of directors, among other achievements. Additionally,in connection with theMerger,retention awards discussed above, and our non-employee director compensation program,•preparation for and attendance at selected Compensation Committee meetings, and•assistance with this CD&A.FW Cook was retained by and reports to theCompany completed a private placement of Series B preference shares, common sharesCompensation Committee and,warrants (the "Sirius Group Private Placement"). The Sirius Group Private Placement raised proceeds of $226.1 million.Allan Waters, Chairmanat the request of theBoard and CEO, Sirius GroupMr. Waters served asCompensation Committee, participates in committee meetings. FW Cook did not provide any other services to theChairman and CEO of Sirius Group until February 9, 2019. Under Mr. Waters' leadership, Sirius Group returned $2.2 billion in capital to White Mountains during the period from 2007 through 2016, positioning it for the acquisition by CMIG International in 2016. Mr. Waters executed Sirius Group's new mission of growth by leading Sirius Group's expansion into the Casualty, Primary Surety and Environmental markets. By initiating strategic acquisitions, he further strengthened Sirius Group's position in the Accident & Health market.Mr. Waters' salary for 2018 was $500,000, which was unchanged relative to prior year. Mr. Waters had a target bonus of $250,000, or 50% of salary, which also remained unchanged from prior year. In connection with Mr. Waters' separation from theCompanyhe received an annual bonus for 2018 in the amount of $50,000 based upon the financial results of the Company and consistent with the overall funding of the Company's bonus pool at 20%. Mr. Waters used his $50,000 cash bonus payment and a portion of the vesting of his 2016-2018 Sirius Group LTIP performance shares to fund the Special Bonus. Mr. Waters elected to receive a cash payoutwith respect to 2019. The Compensation Committee reviewed thevestingindependence ofhis 2016-18 SiriusFW Cook under Nasdaq and SEC rules and concluded that the work of FW Cook has not raised any conflict of interest.Comparison to Peer GroupLTIP performance share award under the 2016 LTIP in the amountTo obtain a broad view of$1,157,050, less $114,444 used to fund the Special Bonus,competitive practices among industry peers and competitors fora net payout of $1,042,605. In addition, Mr. Waters received reimbursements for Bermudian housing costs, which totaled $275,000 for 2018, and was eligible for a home leave allowance for the equivalent of seven trips to the U.S. per year, with a maximum allowance of $15,000.In 2018, Mr. Waters was granted 275,024 Sirius Group LTIP performance shares for the 2018-2020 performance cycle with a target award value of $5,670,995, and in connection with the public listing, a one-time grant of performance share units under the 2018 Omnibus Incentive Plan with a target award value of $2,200,000.Kernan (Kip) V. Oberting, President and Chief Executive Officer and former CFO, Sirius Group and President, Sirius Capital Markets, Inc.Mr. Oberting was appointed CEO of Sirius Group, beginning on February 9, 2019. Prior to that and during 2018, Mr. Oberting was President and CFO of Sirius Group and President of Sirius Capital Markets, Inc., the organization dedicated to management and direction of Sirius Group's strategic capital management function. In addition to leading Sirius Group's mergers and acquisition opportunities and activities, as President and CFO, Mr. Oberting was responsible for the capital strategy for the entire organization and for the assessment and execution of financial market opportunities and investment strategies.In October 2018,executive talent, the Compensation Committeebased upon areviews market data for peer groupstudy prepared by FW Cook, approved an increase in Mr. Oberting's salarycompanies. In selecting companies for2018 to $500,000, which reflected a raise from $475,000 effective as of January 1, 2018. Mr. Oberting had a target bonus of $250,000, or 50% of salary, which remained unchanged from prior year as a percentage of base salary. Mr. Oberting received a cash bonus payout of $50,000, or 20% of target, consistent with the 2018 annual bonus funding from the overall bonus pool. Mr. Oberting used all of his $50,000 cash bonus payment and a portion of the vesting of his 2016-2018 Sirius Group LTIP performance shares to fund the Special Bonus.In addition, as recognition for Mr. Oberting's extensive contributions to the Merger, the public listing of the Company's common shares on the Nasdaq Global Select Market, and a favorable financing structure, Mr. Oberting was granted in February 2019 a supplemental retentive-based restricted share unit award under the 2018 Omnibus Incentive Plan with a target award value of $200,000, subject to three-year cliff vesting. Although this award was granted in recognition of 2018 performance, under the SEC executive compensation disclosure rules, this retentive award will be reported as compensation in the 2019 Summary Compensation Table.Mr. Oberting elected to receive common shares of the Company as a payout with respect to the vesting of his 2016-18 Sirius Group LTIP performance share award under the 2016 LTIP with a value of $466,676, less $16,326 used to fund the Special Bonus, for a net value of $450,350. In addition, Mr. Oberting receives reimbursements for Bermudian housing costs, which totaled $137,712 for 2018, and is eligible for a home leave allowance for the equivalent of seven trips to the U.S. per year, with a maximum allowance of $15,000.In 2018, Mr. Oberting was granted 118,720 Sirius Group LTIP performance shares under the 2016 LTIP for the 2018-2020 performance cycle with a target award value of $2,448,006 and in connection with the public listing, a one-time grant of performance share units under the 2018 Omnibus Incentive Plan with a target award value of $1,600,000.Monica Cramér Manhem, Chief Operating Officer, Sirius Group and President and CEO, Sirius InternationalMs. Cramér Manhem serves as the Chief Operating Officer, Sirius Group and the President and CEO, Sirius International. In determining Ms. Cramér Manhem's 2018 compensation,our peer group, the Compensation Committeeconsidered Ms. Cramér Manhem's performance in leading Sirius International through challenging market conditions by focusing on the maintenance of sustainable, profitable underwriting and strengthening relationships. The Compensation Committee also considered her role in identifying and supporting initiatives to develop and strengthen Sirius Group's brand around the globe.Ms. Cramér Manhem's salary for 2018 was $496,607, which was unchanged relative to prior year in local currency. Ms. Cramér Manhem had a target bonus of $248,303,considers companies that meet one or50% of salary, which also remained unchanged from prior year. Ms. Cramér Manhem received a discretionary cash bonus payout of $49,661, or 20% of target, consistent with the 2018 annual bonus funding from the overall bonus pool. Ms. Cramér Manhem used $34,188 of her cash bonus payout to fund the Special Bonus. In addition, in connection with her extensive contributions to the Merger and the public listingmore of theCompany's common shares on the Nasdaq Global Select Market, Ms. Cramér Manhem received in February 2019 a supplemental retentive-based restricted share unit award under the 2018 Omnibus Incentive Plan with a target award value of $198,643, subject to three-year cliff vesting, for her contributions in 2018. Although this award was granted in recognition of 2018 performance, under the SEC executive compensation disclosure rules, this retentive award will be reported as compensation in the 2019 Summary Compensation Table.Ms. Cramér Manhem elected to receive common shares of the Company as payout with respect to the vesting of her 2016-2018 Sirius Group LTIP performance share award under the 2016 LTIP with a value of $240,554. In addition, Ms. Cramér Manhem receives a Company-provided car and participates in a nonqualified deferred compensation program, as further described in the "2018 Summary Compensation Table," "2018 Nonqualified Deferred Compensation" table and related footnotes.In 2018, Ms. Cramér Manhem was granted 57,177 Sirius Group LTIP performance shares under the 2016 LTIP for the 2018-2020 performance cycle with a target award value of $1,178,990, and in connection with the public listing, a grant of performance share units under the 2018 Omnibus Incentive Plan with a target award value of $1,600,000.Gene Boxer, Executive Vice President, Chief Strategy Officer & Group General Counsel, Sirius GroupMr. Boxer serves as Sirius Group's Executive Vice President, Chief Strategy Officer & Group General Counsel, responsible for managing its legal and compliance functions globally. Mr. Boxer is also responsible for overseeing the execution of Sirius Group's strategic M&A and capital markets initiatives.In October 2018,following peer group selection criteria established by the CompensationCommittee, based upon a peer group study prepared by FW Cook, approved an increase in Mr. Boxer's salary for 2018Committee:•approximate to$500,000, which reflected a raise from approximately $475,000, effective asSirius Group’s scope ofJanuary 1, 2018. Mr. Boxer had a target bonusbusiness and that of$250,000, or 50% of salary, which remained unchanged from prior year as a percentage of base salary. Given Mr. Boxer's extensive contributionsits subsidiaries, including revenue andoverall valuemarket capitalization,•similar to Sirius Grouphe received a discretionary cash bonus payout of $50,000, or 20% of target, consistent with the 2018 annual bonus funding from the overall bonus pool. Mr. Boxer used a portion of his annual bonus, $21,023, to fund the Special Bonus. In addition, in connection with Mr. Boxer's extensive contributions to the Merger, the public listing of the common shares of the Company on the Nasdaq Global Select Market and a favorable financing structure, Mr. Boxer was granted in February 2019 a supplemental retentive-based restricted share unit award under the 2018 Omnibus Incentive Plan with a target award value of $300,000, subject to three-year cliff vesting. Although this award was granted in recognition of 2018 performance, under the SEC executive compensation disclosure rules, this retentive award will be reported as compensationin the2019 Summary Compensation Table.Mr. Boxer electedimportance toreceive common sharestheir business ofthe Company as payout with respect to the vesting of the 2016-18 LTIP performance shares under the 2016 LTIP with a value of $147,926.Mr. Boxer received a cash payment of $325,000 in August 2018 per the terms of his August 2016 offer of employment.In 2018, Mr. Boxer was granted 38,792 Sirius Group LTIP performance shares under the 2016 LTIP, which amount was subsequently increased in October 2018 by the Compensation Committee to 65,470 Sirius Group LTIP performance shares, for the 2018-2020 performance cycle with a target award value of $1,349,991, and in connection with the public listing, Mr. Boxer received a grant of performance share units under the 2018 Omnibus Incentive Plan with a target award value of $1,600,000.Jeffrey W. Davis, Executive Vice President, CRO & Chief Actuary, Sirius GroupMr. Davis serves as Sirius Group's Executive Vice President, CRO & Chief Actuary, responsible for overseeing Sirius Group's loss reservingcapital allocation, investments and risk management,functions, including managing the internal economic capital model, managing key exposures and mitigating risk for multiple lines of business and geographic regions in the (re)insurance arena.•Mr. Davis' salary for 2018 was $450,000, which was unchanged relative to prior year. Mr. Davis had a target bonus of $225,000, or 50% of salary, which also remained unchanged from prior year. Given Mr. Davis' extensive contributions and overall value tocompete with Sirius GroupMr. Davis receivedfor adiscretionary cash bonus payoutcomparable pool of$45,000, or 20% of target, consistent with the 2018 annual bonus funding from the overall bonus pool. Mr. Davis' cash bonus is in part reflective of his direction oftalent, and•reflect SiriusGroup's reserving process as well as direction of Sirius Group's Group Supervision duties for the Bermuda Monetary Authority. In addition, in FebruaryGroup’s global presence.During 2019,Mr. Davis received a supplemental retentive-based restricted share unit award under the 2018 Omnibus Incentive Plan with a target award value of $135,000, subject to three-year cliff vesting for his contributions in 2018. Although this award was granted in recognition of 2018 performance, under the SEC executive compensation disclosure rules, this retentive award will be reported as compensation in the 2019 Summary Compensation Table.Mr. Davis elected to receive common shares of the Company as payout with respect to the vesting of his 2016-18 Sirius Group LTIP performance share award under the 2016 LTIP with a value of $209,572. In addition, Mr. Davis receives reimbursements for Bermudian housing costs, which totaled $275,000 for 2018.In 2018, Mr. Davis was granted 49,814 Sirius Group LTIP performance shares under the 2016 LTIP for the 2018-2020 performance cycle with a target award value of $1,027,165, and in connection with the public listing, a grant of performance share units under the 2018 Omnibus Incentive Plan with a target award value of $700,000.Competitive Analysis and Compensation Program Enhancements Commensurate with Public ListingIn November 2017,the Compensation Committee engaged FW Cook to perform a competitive analysis of SiriusGroup'sGroup’s compensation program.As noted above, the November 2017The 2019 study found that our compensation program for our38senior executives is generally more variable than that at many of our peer companies. Specifically, the salaries and other fixed compensation components of SiriusGroup'sGroup’s senior executives tend to be somewhat lower than that of SiriusGroup'sGroup’s peers, while variable compensation opportunities tend to be greater than the average of SiriusGroup'sGroup’s peers. The peers included inthatthe 2019 study were: Alleghany, Arch Capital, Argo Group, Aspen Insurance, Axis Capital, Enstar Group, Everest Re Group, RenaissanceRe, W.R. Berkley and White Mountains Insurance Group. As compared to 2018, the peer companies for 2019 included the additions of Alleghany, Enstar GroupValidus, Renaissance Re,and W.R. Berkley, while removing Global Indemnity, Hiscox,Aspen Insurance, Allied World Assurance Company, Maiden Holdings, Argo Group, OneBeacon Insurance Group,James River Group, Maiden Holdings andGlobal Indemnity. Additional companies of interest for which compensation data was provided to the Compensation Committee included AXIS Capital, Arch Capital, Allegheny and Everest Group. ThisValidus. The peergroup was selected based on publicly traded companies that generallycompany changes reflected acquisitions as well as agroup (i) approximate to Sirius Group's scopemore indicative list ofbusiness and that of its subsidiaries, including revenue and market capitalization, (ii) are similar to us in the importance to their business of capital allocation, investments and risk management, (iii) compete with Sirius Group for a comparable pool of talent, and (iv) reflect Sirius Group's global presence.In anticipation of the Merger, the Compensation Committee again engaged FW Cook as a compensation consultant to assist the Compensation Committee in its review of executive and director compensation practices in light of the transition of Sirius Group from a private to a public company, and specifically,companies with respect to thecompetitiveness ofpeer group criteria described above. Since SiriusGroup's executiveGroup’s size measures (e.g., premiums, assets anddirector compensation, executive compensation program design matters,markettrends and technical considerations. Priorcapitalization) relative toengaging FW Cook in anticipation oftheMerger,2019 peer study were on the smaller side, the Compensation Committeereviewed and assessedviewed theindependence of FW Cook as a firm and the individuals providing advice to the Compensation Committee in compliance with Nasdaq's listing standards. The Compensation Committee determined that FW Cook as a firm and the relevant individual advisers were independent and that the work to be performed by FW Cook did not raise any conflict of interest.
th percentile compensation levelsThe nature and scope of services that FW Cook provided to the Compensation Committee during 2018 include the following: assistance with providing one-time equity grants to a select group of executives in connection with the closing of the Merger; competitive market compensation analyses; assistance with the redesign of executive compensation programs and resetting ongoing executive25for base salary, annual cash bonus and long-term incentives; assistance with finalizingas the2018 Omnibus Incentive Plan; assistance with non-change-in-control and change-in-control severance arrangements, including severance amounts for certain key executives; assistance with analyzing the director compensation program, including board cash and equity retainers, committee fees and leadership compensation; assistance with updating the Compensation Committee charter for a public company; and preparation for and attendance at selected Compensation Committee meetings.In evaluating Sirius Group's executive compensation program, the Compensation Committee has been advised by FW Cook as to the compensation levels of other companies that might compete with Sirius Group for executive talent. Competitive“size adjusted” marketdata has been developed by FW Cook from several different sources, including proxy statements, and has been updated as deemed necessary.FW Cook provided its analysis in a report provided to the Compensation Committee in July 2018, and identified the following peer group companies for Sirius Group: White Mountains Insurance Group, Validus, Renaissance Re, Hiscox, Aspen Insurance, Maiden Holdings, Argo Group, James River Group and Global Indemnity. Additional companies of interest for which compensation data was provided to the Compensation Committee included AXIS Capital, Arch Capital and Everest Group.The peer companies in August 2018 were the same ones used by FW Cook in the compensation study performed for the Compensation Committee in November 2017 except that Allied World Assurance Company and OneBeacon Insurance Group were removed due to being acquired.rate.
Management Transition CompensationThe compensation of certain executive officers was revised in connection with the departure of Mr. Waters from the Company effective as of February 9, 2019. As Mr. Waters' separation was a termination without cause cause as defined in his employment agreement with the Company dated July 24, 2015 and in accordance with such employment agreement, Mr. Waters received a severance benefit equal to one time his base salary immediately before his separation, an annual bonus payment for 2018 based on actual performance targets, and a payment in connection with his 2019 annual bonus based on actual performance but equal to at least one half of his base salary. Mr. Waters will provide advisory services to the Company for a period of time, during which period he will continue to vest in pending long-term incentive awards in accordance with his employment agreement.Mr. Oberting was appointed CEO of the Company, effective as of the Departure Date. In connection with this appointment, the Company entered into an employment agreement with Mr. Oberting, effective as of the Departure Date. The employment agreement has an initial three-year term and automatically extends for one-year terms, unless either party provides notice of non-renewal at least 90 days prior to the expiration of the then-current term. Under the employment agreement, Mr. Oberting will receive an annual base salary of not less than $500,000, increasing to $1,000,000 on January 1, 2020, and is eligible to receive an annual cash bonus with a target opportunity of no less than 50% of base salary, increasing to 100% of base salary on January 1, 2020. Mr. Oberting is eligible to receive long-term incentives. On February 27, 2019 ("Grant Date"), the Compensation Committee granted Mr. Oberting an initial stock option award with a grant date value of $3,150,000, which will vest upon his continued employment through the third anniversary of the Grant Date, and a performance share unit equity award with three-year, cliff-vesting and a target payout level of $1,350,000. The employment agreement binds Mr. Oberting to certain non-solicitation and non-competition restrictions during the term of his employment and for a period of one year thereafter. If Mr. Oberting's employment is terminated by the Company without cause or Mr. Oberting resigns for good reason, as such terms are defined in the employment agreement, he will receive a severance benefit equal to one times his base salary immediately before his termination and an annual bonus for the year of termination that is not less than his target annual bonus. In addition, if Mr. Oberting provides post-termination advisory services to the Company following such a termination or his retirement in order to facilitate a transition to his successor, he will continue to vest in outstanding long-term incentive awards.
Report of the Compensation Committee on the Compensation Discussion and AnalysisThe Compensation Committee reviewed and discussed the"“Compensation Discussion and Analysis"” section included in thisproxy statementAnnual Report with management. Based on such review and discussion, the Compensation Committee recommended to the Board of Directors that the"Compensation“Compensation Discussion andAnalysis"Analysis” section be included inthe 2018 Annual Report andthis proxy statement for filing with the SEC.COMPENSATION COMMITTEERachelle C. Keller (Chair)
Meyer (Sandy) Frucher
James (Jim) B. Rogers, Jr.(Chair)Rachelle C. KellerMeyer (Sandy) Frucher39EXECUTIVE COMPENSATION TABLES AND NARRATIVES20182019 Summary Compensation TableThe following table provides compensation information for SiriusGroup'sGroup’s principal executive officer, principal financial officer and other NEOs (including our former principal executive officer) for services in their capacities as such during2018.2019.Name and
Principal Position Year Salary Bonus(1) Share
Awards(2) Option
Awards(3) Non-Equity
Incentive Plan
Compensation(4) All Other
Compensation(5) Total Kernan (Kip) V. Oberting,
President and CEO (Former CFO), Sirius Group 2019 $ 500,000 — $ 1,549,993 $ 3,148,624 $ 215,875 $ 12,256 $ 5,426,748 2018 $ 499,615 — $ 1,600,000 — $ 516,676 $ 149,768 $ 2,766,059 2017 $ 471,154 $ 2,186,736 — — $ 707,491 $ 225,635 $ 3,591,016 Ralph A. Salamone,
Executive Vice President
and Chief Financial Officer 2019 $ 469,231 — $ 1,590,002 — $ 200,000 $ 12,256 $ 2,271,489 2018 — — — — — — — 2017 — — — — — — — Gene Boxer,
Executive Vice President, CSO & Group General Counsel, Sirius Group 2019 $ 500,000 — $ 1,649,991 — $ 225,000 $ 12,256 $ 2,387,247 2018 $ 499,231 $ 325,000 $ 1,600,000 — $ 197,926 $ 12,056 $ 2,634,213 2017 $ 450,000 $ 325,000 — — $ 225,000 $ 11,700 $ 1,011,700 Monica Cramér Manhem,
President, Global Reinsurance(6) 2019 $ 475,000 — $ 1,548,641 — $ 113,589 $ 161,351 $ 2,298,581 2018 $ 496,607 — $ 1,600,000 — $ 290,215 $ 171,134 $ 2,557,956 2017 $ 439,025 $ 2,305,348 — — $ 356,104 $ 141,370 $ 3,241,847 Jeffrey W. Davis,
Executive Vice President, CRO & Chief Actuary, Sirius Group 2019 $ 462,116 — $ 1,162,163 — $ 174,375 $ 150,256 $ 1,948,910 2018 $ 450,000 — $ 700,000 — $ 254,572 $ 287,556 $ 1,692,128 2017 $ 450,000 $ 583,094 — — $ 533,621 $ 296,264 $ 1,862,979 Allan L. Waters,
Former Chairman and CEO, Sirius Group 2019 $ 95,307(7) $ 250,000 — — $ 181,552 $ 595,567 $ 1,122,426 2018 $ 500,000 — $ 2,200,000 — $ 1,207,050 $ 292,793 $ 4,199,843 2017 $ 500,000 $ 6,827,486 — — $ 2,525,764 $ 208,514 $ 10,061,764 Name and Principal PositionYear Salary Bonus(1) Share
Awards(2)Non-Equity
Incentive Plan
Compensation(3)All Other
Compensation(4)Total Allan L. Waters,
2018 $ 500,000 $ — $ 2,200,000 $ 1,207,050 $ 292,793 $ 4,199,843 Former Chairman and
2017 $ 500,000 $ 6,827,486 — $ 2,525,764 $ 208,514 $ 10,061,764 CEO, Sirius Group
Kernan (Kip) V. Oberting,
2018
$
499,615
$
—
$
1,600,000
$
516,676
$
149,768
$
2,766,059President and CEO
2017 $ 471,154 $ 2,186,736 — $ 707,491 $ 225,635 $ 3,591,016 (Former CFO), Sirius
Group and President,
Sirius Capital Markets,
Inc.
Monica Cramér Manhem,
2018
$
496,607
$
—
$
1,600,000
$
290,215
$
171,134
$
2,557,956COO, Sirius Group and
2017 $ 439,025 $ 2,305,348 — $ 356,104 $ 141,370 $ 3,241,847 President and CEO, Sirius
International(5)
Gene Boxer,
2018
$
499,231
$
325,000
$
1,600,000
$
197,926
$
12,056
$
2,634,213Executive Vice President,
2017 $ 450,000 $ 325,000 — $ 225,000 $ 11,700 $ 1,011,700 CSO & Group General
Counsel, Sirius Group
Jeffrey W. Davis,
2018
$
450,000
$
—
$
700,000
$
254,572
$
287,556
$
1,692,128Executive Vice President,
2017 $ 450,000 $ 583,094 — $ 533,621 $ 296,264 $ 1,862,979 CRO & Chief Actuary,
Sirius Group
(1)(1)- The amount reported in this column for 2019 represents the guaranteed annual cash incentive paid to Mr.
Boxer represents a special bonus payment of $325,000 in August 2018Waters in connection with hisjoining Sirius Group in August 2016.separation. See “— Compensation Discussion and Analysis — Management Transition.”
(2)(2)The amounts reported in this column for20182019 represent theIPO Incentive Program grantsperformance share units and time based restricted share units granted to the NEOs under the 2018 Omnibus Incentive Plan. The amounts reported in this column are valued based on the aggregate grant date fair value computed in accordance with FASB ASC Topic 718, and are calculated based on the probable satisfaction of the performance conditions for such awards as of the date of grant. Assuming the highest level of performance is achieved for theIPO Incentive Programperformance share unit grants, the maximum value would be as follows: Mr.Waters—$3,300,000;Oberting — $2,699,991; Mr.Oberting—$2,400,000;Salamone — $810,008; Mr. Boxer — $810,008; Ms.Cramer Manhem—$2,400,000; Mr. Boxer—$2,400,000;Cramér Manhem — $810,008; and Mr.Davis—$1,050,000.Davis — $616,310. See Note 14 to the Consolidated Financial Statements included in SiriusGroup'sGroup’s Annual Report on Form 10-K for the year ended December 31,20182019 for a discussion of the relevant assumptions used in calculating the amounts reported for2018.2019.(3)The amounts reported in this column for 2019 represent the value of the stock options received by Mr. Oberting in connection with the execution of his employment agreement. The amounts reported in this column are valued based on the aggregate grant date fair value computed in accordance with FASB ASC Topic 718. See Note 14 to the Consolidated Financial Statements included in Sirius Group’s Annual Reports on Form 10-K for the year-ended December 31, 2019 for a discussion of the relevant assumptions used in calculating the amounts reported for 2019.(3)40(4)Amounts reported in this column represent payouts under the Sirius Group2016-20182017-2019 LTIP, whereby participantshad the option to bewere paid in cash,or shares and all NEOs, other than Mr. Waters, elected to receive their payouts in common shares of Sirius Group,as follows, Mr.Waters—$1,157,050;Waters — $181,552; Mr.Oberting—$466,676; Ms. Cramér Manhem—$240,554; Mr. Boxer—$147,926;Oberting — $78,375; andMr. Davis—$209,572. The amounts reported reflect the awards made to Messrs. Oberting and Waters before deduction of the amounts used to fund the Special Bonus. Amounts reported in this column for 2018 also include annual bonuses paid to each NEO pursuant to the annual bonus program before deduction of the amounts from the Management Committee to fund the Special Bonus, as follows: (i) $50,000 for each of Messrs. Waters, Oberting, and Boxer; (ii) $49,661 forMs. Cramér Manhem — $37,749, and(iii) $45,000 forpayouts under the annual cash incentive program as follows, Mr.Davis. The amounts reported in this column do not include the restricted share units granted to NEOs in February 2019 as a supplemental award, as such awards will be reported as compensation in the 2019 Summary Compensation Table.Oberting — $137,500; Mr. Salamone — $200,000; Mr. Boxer — $225,000; Ms. Cramér Manhem — $75,840; and Mr. Davis — $174,375.(5)(4)- The amounts reported in this column consist of (i) housing allowances in Bermuda for Messrs. Waters
Obertingand Davis in the amounts of$275,000, $137,712$91,667 and$275,000,$137,500, respectively, (ii) a car allowance, food reimbursement and outside director fees earned for serving on the board of directors of an affiliate of the Company for Ms. Cramér Manhem, (iii) health club reimbursements forMessrs. Waters andMr. Davis, (iv) group life insurance premiums in the amount of $1,056 paid for the benefit of Messrs.Waters,Oberting, Boxer and Davis and $88.00 paid for the benefit of Mr. Waters, (v)$11,000$11,200 in employer 401(k) contributions on behalf of Mr.Waters, Mr.Oberting, Mr. Boxer and Mr. Davis and $3,812 for Mr. Waters, (vi)$147,271$139,283 in Sirius Group contributions to a deferred compensation plan maintained for Ms. Cramér Manhem in Sweden, and (vii)reimbursements for travel between the U.S. and Bermuda for Messrs.separation benefits of $500,000 paid to Mr. Watersand Oberting pursuant to their home leave allowances.upon his separation of employment on February 9, 2019. The housing allowances were valued on the basis of the aggregate incremental cost to the Company and represent the amount accrued for payment or paid directly to the applicable NEO. With respect to the other perquisites, the aggregate incremental cost to the Company was generally determined based on the amount paid to the applicable outside provider.
(6)(5)Ms. Cramér Manhem is a Swedish resident and paid in Swedish Krona. Her20182019 salary, annualbonuscash incentive and other compensationwaswere awardedandin U.S. dollars, paid in Swedish Krona and converted herein at the December 31,20172018 spot rate of8.21.8.94. Theshare awards and bonuses were2017-2019 LTIP award was awarded in U.S. dollars, paid inU.S. dollars.Swedish Krona and converted herein at the December 31, 2016 spot rate of 9.05.The amounts reported for Mr. Waters in this column for 2019 represents his salary through the date of termination of his role as Chief Executive Officer (February 9, 2019) and includes a pro-rated salary ($30,000) he received as a Senior Advisor to the Company pursuant to his employment agreement. See “— Compensation Discussion and Analysis — Waters Separation Agreement.”20182019 Grants of Plan-Based AwardsThe following table provides information regarding the possible payouts to our NEOs in20182019 under the annualbonuscash incentive program and the performance shares units, restricted share units and stock options received by our NEOs in2016, 20172019. The amounts reported in the table and2018 underthe2016 LTIP,footnotes to this table are based on the original terms of the awards and do not reflect the changes in equity and cash-based compensation made in July 2020 (including the conversion of PSUs to RSUs and the grant of Special RSU awards) and the conversion of the equity awards from common shares of the Company to common shares of TPRE that will occur in connection withrespectthe Merger. Please see “Executive Compensation — Impact of the Merger Agreement” for a discussion of the impact of the Merger Agreement on outstanding equity awards.41Name Grant
Date Approval
Date(1) Type of Award Estimated Future
Payouts Under
Non-Equity Incentive
Plan Awards(1) Estimated
Future Payouts
Under Equity
Incentive Plan Awards All
other
stock
awards;
number
of shares of
stock or
units(4) All other
options
awards;
number of
securities
underlying
options Exercise or
base price
of option
award Grant date
fair value
of stock
and option
awards(5) Threshold
($)(2) Target
($)(2) Maximum
($)(2) Threshold
#(3) Target
#(3) Maximum
#(3) Kernan
(Kip) V.
Oberting 2/27/2019 2/27/2019 Annual Cash Incentive $ 0 $ 250,000 $ 500,000 2/27/2019 1/30/2019 Stock Options — — — — 1,374,945 $ 12.75 $ 3,148,624 2/27/2019 2/27/2019 2019 PSU — — — — 105,882 211,764 $ 1,349,996 2/27/2019 2/27/2019 2019 RSU — — — — 15,686 $ 199.997 Ralph A.
Salamone 2/27/2019 2/27/2019 Annual Cash Incentive $ 0 $ 250,000 $ 500,000 2/27/2019 2/27/2019 2019 PSU — — — — 31,765 63,530 $ 405,004 2/27/2019 2/27/2019 2019 RSU — — — — 74,117 $ 944,992 2/27/2019 2/27/2019 2019 Retention RSU — — — — 18,824 $ 240,006 Gene
Boxer 2/27/2019 2/27/2019 Annual Cash Incentive $ 0 $ 250,000 $ 500,000 2/27/2019 2/27/2019 2019 PSU 31,765 63,530 $ 405,004 2/27/2019 2/27/2019 2019 RSU — — — — 74,117 $ 944,992 2/27/2019 2/27/2019 2019 Retention RSU — — — — 23,529 $ 299,995 Monica
Cramér
Manhem 2/27/2019 2/27/2019 Annual Cash Incentive $ 0 $ 237,500 $ 475,000 2/27/2019 2/27/2019 2019 PSU — — — — 31,765 63,530 $ 405,004 2/27/2019 2/27/2019 2019 RSU — — — — 74,117 $ 944,992 2/27/2019 2/27/2019 2019 Retention RSU — — — — 15,580 $ 198,645 Jeffrey W.
Davis 2/27/2019 2/27/2019 Annual Cash Incentive $ 0 $ 232,500 $ 465,000 2/27/2019 2/27/2019 2019 PSU 24,169 48,338 $ 308,155 2/27/2019 2/27/2019 2019 RSU — — — — 56,393 $ 719,011 2/27/2019 2/27/2019 2019 Retention RSU 10,588 $ 134,997 Allan L.
Waters(6) — — Annual Cash Incentive $ 00 $ 250,000 $ 500,000 (1)The “Approval Date” refers to theIPOdate on which the Compensation Committee approved the equity grant. See “— Compensation Discussion and Analysis — Elements of 2019 NEO Compensation — Long-Term Equity IncentiveGrants, the target number performance share units under the 2018 Omnibus Incentive Plan.Compensation.”Estimated Future Payouts
Under Non-Equity
Incentive Plan Awards(1)Estimated Future Payouts
Under Equity
Incentive Plan AwardsGrant date
fair value of
stock and
option
awards(4)NameGrant Date Approval
DateType of Award Threshold
($)Target
($)Maximum
($)Threshold
#Target
#Maximum
#Allan L. Waters
3/21/2018 3/21/2018 Annual Bonus(1) $ 0 $ 250,000 $ 500,000 3/21/2018 3/21/2018 2018 - 2020 LTIP(2) $ 0 $ 5,670,995 $ 11,341,990 8/6/2018 8/3/2018 IPO Incentive Grant(3) — — — — 127,725 191,588 $ 2,200,000 Kernan (Kip) V. Oberting
3/21/2018 3/21/2018 Annual Bonus(1) $ 0 $ 250,000 $ 500,000 10/31/2018 10/31/2018 2018 - 2020 LTIP(2) $ 0 $ 2,448,006 $ 4,896,013 8/6/2018 8/3/2018 IPO Incentive Grant(3) — — — — 92,891 139,337 $ 1,600,000 Monica Cramér Manhem
3/21/2018 3/21/2018 Annual Bonus(1) $ 0 $ 248,303 $ 496,606 3/21/2018 3/21/2018 2018 - 2020 LTIP(2) $ 0 $ 1,178,990 $ 2,357,980 8/6/2018 8/3/2018 IPO Incentive Grant(3) — — — — 92,891 139,337 $ 1,600,000 Gene Boxer
3/21/2018 3/21/2018 Annual Bonus(1) $ 0 $ 250,000 $ 500,000 3/21/2018 3/21/2018 2018 - 2020 LTIP(2) $ 0 $ 799,994 $ 1,599,988 10/31/2018 10/31/2018 2018 - 2020 LTIP(2) $ 0 $ 549,997 $ 1,099,995 8/6/2018 8/3/2018 IPO Incentive Grant(3) — — — — 92,891 139,337 $ 1,600,000 Jeffrey W. Davis
3/21/2018 3/21/2018 Annual Bonus(1) $ 0 $ 225,000 $ 450,000 3/21/2018 3/21/2018 2018 - 2020 LTIP(2) $ 0 $ 1,027,155 $ 2,054,310 8/6/2018 8/3/2018 IPO Incentive Grant(3) — — — — 40,639 60,959 $ 700,000
(1)(2)
The amounts reported for the annualbonuscash incentive represent threshold, target and maximum cash award levels set in20182019 under the20182019 annualbonuscash incentive program. Please seeComponents of NEO2018 Compensation—2019 Compensation — AnnualBonusCash Incentive for further information regarding the20182019 annualbonuscash incentive program.(3)(2)The amounts reported for the2018-20202019 — 2021 LTIP represent the threshold, target and maximum cash-denominated performance share awards payable under the2016 LTIP2018 Omnibus Incentive Plan with respect to the2018-20202019 — 2021 performance cycle. For actively employed NEOs, these performance shares are scheduled to vest on December 31,20202021 based onUROAE, ROAE,ABVPS andAsia Technical ProfitUROAE performance goals over the2018-20202019 — 2021 performance cycle.(4)(3)The grant ofperformancetime based restricted share unitsmade on August 6, 2018 time vest as follows: 25% on December 31, 2019; 25% on December 31, 2020; and 50% atcliff vests three years from theenddate ofthe performance period on December 31, 2021. These grants performance vest in 25% increments based upon the ROE achieved for each performance period, except for the last performance period which 25% vests on the three-year average of the entire performance period.grant.42(4)(5)The amounts reported in this column reflect the fair value on the date of grant, and, for2018 representawards subject to performance-based vesting conditions, based upon theIPO Incentive Program grants toprobable outcome of theNEOs underperformance conditions as of the2018 Omnibus Incentive Plan. The amountsgrant date of the awards reported inthis column are valued based ontheaggregate grant date fair value computedtable, in all cases, calculated in accordance with FASB ASC Topic 718,and are calculated based onCompensation — Stock Compensation.(6)The amount reported for Mr. Waters reflects theprobable satisfaction of the performance conditions for such awards as of the date of grant. The number of shares was determined based upon the IPO share price of $17.22.Description of Plan-Based AwardsNon-equity2019 cash incentiveawards and equity awards reportedhe received inthe 2018 Grants of Plan Based Awards table were grantedconnection with his termination pursuant toapplicable NEOs under the Company's annual bonus program and the 2016 LTIP and 2018 Omnibus Incentive Plan, respectively.Annual Bonuses under the Annual Bonus ProgramPlease refer to the section entitledhis employment agreement. See “— Compensation Discussion andAnalysis—Components of 2018 NEO Compensation Components—Annual Cash BonusesAnalysis — Waters Separation Agreement.”above for a description of the 2018 annual bonus award.Equity Incentive AwardsThe number of performance share units awarded to each NEO was determined by dividing the target value to be delivered to each NEO by the IPO price of $17.22. As described above, the number of performance share units actually earned by the NEO is determined based on the achievement of the applicable performance conditions for the three-year performance period; any earned common shares will vest at the end of the performance period on December 31, 2021, except for the IPO Incentive Grant which shall time vest in 25% increments on December 31,2019and December 31, 2020 and 50% on December 31, 2021 based upon the ROE achieved for each performance period, except for the last performance period which 25% vests based on the three year average ROE for the entire performance period.The following table sets forth information concerning the outstanding equity awards held by the NEOs as of December 31,2018.2019. The amounts reported in the table and the footnotes to this table are based on the original terms of the awards and do not reflect the changes in equity and cash-based awards made in July 2020 (including the conversion of PSUs to RSUs and the grant of RSU awards) and the conversion of the equity awards from common shares of the Company to common shares of TPRE that will occur in connection with the Merger. Please see “Executive Compensation — Impact of the Merger Agreement” for a discussion of the impact of the Merger Agreement on outstanding equity awards. Option Awards Stock Awards Name Grant Date Number of
securities
underlying
unexercised
options (#)
exercisable Number of
securities
underlying
unexercised
options (#)
unexercisable Equity
incentive
plan
awards;
number of
securities
underlying
unexercised
unearned
options (#) Option
Exercise
Price Option
Exercise
Date Number
of Shares
or Units
That Have
Not
Vested (#) Market
Value of
Shares or
Units of
Stock
That Have
Not Vested
($) Equity
Incentive
Plan
Awards:
Number
of
Unearned
Shares,
Units or
Other
Rights
That Have
Not Vested
(#)(1) Equity
Incentive
Plan
Awards:
Market or
Payout
Value of
Unearned
Shares,
Units or
Other
Rights
That Have
Not Vested
($)(1) Kernan V. Oberting 8/6/2018(2) — — — — — — — 69,668 608,901 2/27/2019(3) — 1,374,945 — 12.75 2/27/2024 — — — — 2/27/2019(4) — — — — — — — 105,882 925,409 2/27/2019(5) — — — — — 15,686 137,096 — — Ralph A. Salamone 8/6/2018(2) — — — — — — — 34,834 304,447 2/27/2019(4) — — — — — — — 31,765 277,626 2/27/2019(5) — — — — — 92,941 812,304 — — — — — — Gene Boxer 8/6/2018(2) — — — — — — — 69,668 608,901 2/27/2019(4) — — — — — — — 31,765 277,626 2/27/2019(5) — — — — — 97,646 853,426 — — Monica Cramèr Manhem 8/6/2018(2) — — — — — — — 69,668 608,901 2/27/2019(4) — — — — — — — 31,765 277,626 2/27/2019(5) — — — — — 89,697 783,952 — — Jeffrey W. Davis 8/6/2018(2) — — — — — — — 30,479 266,389 2/27/2019(4) — — — — — — — 24,169 211,237 2/27/2019(5) — — — — — 66,981 585,414 — — Allan L Waters 8/6/2018(2) — — — — — — — 95,794 837,239 Stock Awards NameGrant Date Number of
Shares
or Units
That
Have Not
Vested (#)Market
Value of
Shares or
Units of
Stock That
Have Not
Vested ($)Equity
Incentive
Plan Awards:
Number of
Unearned
Shares,
Units or
Other
Rights
That
Have Not
Vested (#)(1)Equity
Incentive
Plan Awards:
Market or
Payout
Value of
Unearned
Shares,
Units or
Other
Rights
That
Have Not
Vested ($)(2)Allan Waters
8/6/2018 — — 127,725 1,698,743 Kernan (Kip) V. Oberting
8/6/2018 — — 92,891 1,235,450 Monica Cramér Manhem
8/6/2018 — — 92,891 1,235,450 Gene Boxer
8/6/2018 — — 92,891 1,235,450 Jeffrey W. Davis
8/6/2018 — — 40,639 540,499 (1)Market value is determined based on the December 31, 2019 closing stock price of $8.74 per share.43(1)(2)The awards reported in thistablerow vest as follows:25% on December 31, 2019; 25%one-third on December 31, 2020; and50%two-thirds at the end of the performance period on December 31, 2021. Thesegrantsawards performance vestin 25% increments basedupon the ROE achieved for each performance period, except for the last performance period which25%one-third vests on the three-year average ROE.Since the performance period began on January 1, 2019, theThe awards, for the purposes of this table, are reported at target value.(3)(2)Market value is determined basedThe stock options vest on the third anniversary of the grant date, February 27, 2022 and expire on the fifth anniversary of the grant date, February 27, 2024.(4)The award reported in this row cliff-vests on December 31,2018 closing stock price2021, the end of$13.30 per share.the performance period, subject to the relevant performance conditions, ABVPS and UROAE, being satisfied and continued service. The awards for the purposes of this table are reported at target value.(5)TableThe award reported in this row cliff-vests on the third anniversary ofContentsthe grant date, February 27, 2022.
There were no options exercised or common shares vested in2018.2019.
The Company does not provide any qualified or nonqualified defined benefit pension plan participation to its NEOs.Except as described below, none of our NEOs participated in a nonqualified deferred compensation arrangement in2018.2019. The following table provides information regarding a nonqualified deferred compensation plan provided to Ms. Cramér Manhem in Sweden for the year ended December 31,2018.2019.Name Registrant
Contributions in
Last Fiscal Year Aggregate
Earnings in
Last
Fiscal Year Aggregate
Balance at Last
Fiscal Year End Monica Cramér Manhem $ 139,283 $ 57,163 $ 1,068,819(1) NameRegistrant
Contributions in
Last Fiscal YearAggregate
Earnings in
Last Fiscal YearAggregate
Balance at
Last Fiscal Year EndMonica Cramér Manhem
$ 147,271 $ 37,314 $ 950,480 (1)
(1)(1)- Ms. Cramér Manhem is a Swedish resident and paid in Swedish Krona. The aggregate balance at last fiscal year end has been converted to U.S. dollars using the December 31,
20172018 spot rate of8.21.
Ms. Cramér Manhem participates in a nonqualified deferred compensation plan for select employees in Sweden. Pursuant to the terms of Ms. CramérManhem'sManhem’s employment agreement, beginning in March 2014, Sirius Group makes an annual contribution to the plan in a minimum amount equal to SEK 1,100,004 (or $121,482, based on a December 30, 2016 conversion rate), but adjusted to reflect cost of living adjustments in Sweden. As noted above, the contribution rate for20182019 was$147,271.$139,283. Ms. Cramér Manhem does not make any corresponding contributions to the plan. Contributions are invested in a variety of generally available mutual funds and indexes, as selected by Ms. Cramér Manhem. Payments from the plan will occur following Ms. CramérManhem'sManhem’s retirement over a payment period as selected by Ms. Cramér Manhem.20182019 Potential Payments Upon a Termination or a Change in ControlThe following table reflects the potential payments and benefits to which each of our NEOs would be entitled in the event of a termination of his or her employment or change in control of Sirius Group as of December 31,2018.2019. The amounts shown in the table below are estimates and were calculated assuming that the termination of employment or change in control was effective as of December 31,20182019 based on the employment arrangement that existed between Sirius Group and the respective NEO at such date. The actual amounts that would be paid to a NEO can only be determined at the time of the termination of employment or change in control. The section entitled"“Employment Arrangements"” below contains a summary of the material terms of the employment arrangements we have with each oftheour NEOs shown in the table below, including terms related to any payments to which the NEO would be entitled in connection with a termination of his or her employment or change in control of Sirius Group. In addition, as discussed below, the 2016
44LTIP and the 2018 Omnibus Incentive Plan provide for certain benefits upon a qualifying termination of employment. Please see the narrative following this table for a summary of the compensation payable to Mr. Waters in connection with his separation.As noted above in “Executive Compensation — Impact of Merger Agreement” on August 6, 2020, the Company entered into a Merger Agreement pursuant to which, upon the closing of the merger contemplated thereby, the Company will become a wholly-owned subsidiary of TPRE. The contemplated merger will constitute a change in control under the Executive Severance Plan and for purposes of outstanding awards under the 2016 LTIP, 2018 Omnibus Incentive Plan and the annual cash incentive program. If a change in control such as the Merger was consummated on December 31, 2019, the NEOs would have been entitled to the benefits described in the tables below under the “Termination without Cause/for Good Reason” or “CIC Qualifying Termination.”In addition, as noted above, on August 6, 2020, in connection with the Company’s entry into the Merger Agreement, the Company entered into a letter agreement with each of Mr. Oberting and Mr. Boxer, intended to provide them with certain assurances that will minimize any distractions they would otherwise face as they complete the transactions contemplated by the Merger Agreement. Specifically, the letter agreements entitle Mr. Oberting and Mr. Boxer to severance protection if their employment is terminated involuntarily without Cause or they resign for Good Reason, in either case prior to the consummation of the Merger and following a Removal Event, with the same benefits they would receive if they were terminated by the Company without Cause immediately after the consummation of the Merger. For this purpose, “Cause” and “Good Reason” also includes the removal from the Company’s board of directors of independent directors who are considered members of the Original Strategic Review Committee and, in Mr. Oberting’s case, his own removal from the Company’s board of directors. In addition, the letter agreement provided an acknowledgement that each of Mr. Oberting and Mr. Boxer will have “Good Reason” to resign from employment immediately upon consummation of the Merger.Name Cash
Severance(1) Cash
Incentive(2) Continuation
of Medical
Benefits(3) LTIP
Awards(4) Equity
Incentive
Awards(5) Other(6) Total Kernan (Kip) V. Oberting(7) Death/Disability — $ 137,500 — $ 691,940 $ 1,513,200 — $ 2,342,460 Termination without Cause/for Good Reason $ 500,000 $ 250,000 $ 258,543 $ 173,331 $ 1,348,889 $ 393,000 $ 2,923,763 Retirement — — — — — — — CIC Qualifying Termination $ 1,000,000 $ 250,000 $ 258,543 $ 1,729,849 $ 2,183,466 $ 393,000 $ 5,814,858 Ralph A. Salamone Death/Disability — — — $ 141,325 $ 681,687 — $ 823,012 Termination without Cause/for Good Reason $ 1,300,000 $ 200,000 — $ 35,402 $ 576,464 — $ 2,111,866 Retirement — — — — — — — CIC Qualifying Termination $ 1,800,000 $ 250,000 — $ 353,314 $ 1,588,856 — $ 3,992,170 Gene Boxer Death/Disability — — — $ 381,581 $ 706,824 — $ 1,088,405 Termination without Cause/for Good Reason $ 1,500,000 $ 225,000 $ 32,971 $ 95,586 $ 601,596 — $ 2,455,153 Retirement — — — — — — — CIC Qualifying Termination $ 2,000,000 $ 250,000 $ 65,942 $ 953,952 $ 2,036,044 — $ 5,305,938 Monica Cramèr Manhem(8) Death/Disability — $ 47,500 — $ 333,247 $ 1,476,455 — $ 1,857,202 NameCash
Severance(1)Bonus(2) Continuation
of Medical
Benefits(3)LTIP
Awards(4)IPO
Incentive
Grants(5)Other(6) Total Allan L. Waters(7)
Death/Disability
— $ 50,000 — $ 3,648,394 $ 1,698,743 — $ 5,397,137 Termination without Cause/for Good Reason
$ 500,000 $ 250,000 $ 35,290 $ 2,049,718 $ 1,698,743 $ 90,000 $ 4,623,751 Retirement
— — $ 35,290 $ 2,049,718 $ 1,698,743 $ 90,000 $ 3,873,751 CIC Qualifying Termination
$ 500,000 $ 250,000 $ 35,290 $ 10,949,894 $ 1,698,743 $ 90,000 $ 13,523,927 Kernan (Kip) V. Oberting(8)
Death/Disability
— $ 50,000 — $ 1,574,906 $ 1,235,450 — $ 2,860,356 Termination without Cause/for Good Reason
$ 500,000 $ 250,000 $ 287,167 $ 884,804 $ 1,235,450 $ 396,000 $ 3,553,421 Retirement
— — — — — — — CIC Qualifying Termination
$ 1,000,000 $ 250,000 $ 287,167 $ 4,726,754 $ 1,235,450 $ 396,000 $ 7,895,371 Monica Cramér Manhem(9)
Death/Disability
— $ 49,661 — $ 758,495 $ 1,235,450 — $ 2,043,606 Termination without Cause/for Good Reason
$ 496,607 $ 248,304 $ 2,650 $ 501,418 $ 1,235,450 $ 238,779 $ 2,723,208 Retirement
— — $ 2,650 $ 501,418 $ 1,235,450 $ 238,779 $ 1,978,297 CIC Qualifying Termination
$ 993,214 $ 248,304 $ 2,650 $ 2,276,463 $ 1,235,450 $ 238,779 $ 4,994,860 Gene Boxer
Death/Disability
— — — $ 600,796 — — $ 600,796 Termination without Cause/for Good Reason
$ 500,000 $ 50,000 $ 26,867 $ 57,762 — — $ 634,629 Retirement
— — — — — — — CIC Qualifying Termination
$ 1,000,000 $ 250,000 $ 53,733 $ 1,937,367 $ 1,235,450 — $ 4,476,550 45NameCash
Severance(1)Bonus(2) Continuation
of Medical
Benefits(3)LTIP
Awards(4)IPO
Incentive
Grants(5)Other(6) Total Jeffrey W. Davis
Death/Disability
— — — $ 660,815 — — $ 660,815 Termination without Cause/for Good Reason
$ 450,000 $ 45,000 $ 18,775 $ 81,835 — — $ 595,610 Retirement
— — — — — — — CIC Qualifying Termination
$ 900,000 $ 225,000 $ 37,550 $ 1,983,300 $ 540,499 — $ 3,686,349 Name Cash
Severance(1) Cash
Incentive(2) Continuation
of Medical
Benefits(3) LTIP
Awards(4) Equity
Incentive
Awards(5) Other(6) Total Termination without Cause/for Good Reason $ 1,275,000 $ 237,500 $ 18,228 $ 83,478 $ 1,698,073 $ 231,000 $ 3,543,279 Retirement — — $ 18,228 $ 83,478 $ 1,698,073 $ 231,000 $ 2,030,779 CIC Qualifying Termination $ 1,750,000 $ 237,500 $ 18,228 $ 833,117 $ 1,966,550 $ 231,000 $ 5,036,395 Jeffrey W. Davis Death/Disability — — — $ 290,333 $ 498,720 — $ 789,053 Termination without Cause/for Good Reason $ 1,265,000 $ 174,375 $ 18,019 $ 72,728 $ 418,663 — $ 1,948,785 Retirement — — — — — — — CIC Qualifying Termination $ 1,730,000 $ 232,500 $ 36,038 $ 725,831 $ 1,222,598 — $ 3,946,967 (1)For each NEOwith the exception of Mr. Waters,the amount payable upon a"CIC“CIC QualifyingTermination"Termination” represents a lump sum payment equal to two times annual base salary in the event of a termination without cause or for good reason within 24 months following a change in control in accordance with the Executive SeverancePlan.Plan and the full payment of their cash retention award. For each of Messrs. Oberting,Davis,Salamone, Boxer andBoxer,Davis, the amount payable upon a termination without cause or for good reason that is not a CIC Qualifying Termination represents continued annual base salary paid for one year and the full payment of their cash retention awards in accordance with the Executive Severance Plan. Pursuant to the terms of their employment agreements, for each ofMessrs.Mr. Obertingand Watersand Ms. Cramér Manhem, the amount payable upon a termination without cause or for good reason that is not a"CIC“CIC QualifyingTermination"Termination” represents a lump sum payment equal to one times annual basesalary.salary and for Ms. Cramér Manhem the payment of her cash retention award.(2)(2)These amounts represent payments of eachNEO'sNEO’s annualbonuscash incentive for the year in which termination occurs, calculated based on actual performance through the end of such year. Thebonusescash incentives are paid in the fiscal year following the year in which termination occurred and are paid at the same time that annualbonusescash incentives are paid to otherbonus-eligiblecash incentive-eligible employees. For Messrs.DavisSalamone Boxer andBoxer,Davis, in the event of a termination without cause or for good reason, payment is prorated based on the number of days worked in the year of termination. Pursuant to the terms of the employment agreements forMessrs.Mr. Obertingand Watersand Ms. Cramér Manhem, payment is not prorated in the event of such a termination, and the NEO is eligible to receive the full amount. For all NEOs, payment is not prorated in the event of a CIC Qualifying Termination.Mr. Waters' andMs. CramérManhem'sManhem’s payments additionally will be no lower than target in the event of a termination without cause or for good reason, whether or not following a change in control. Furthermore,Mr. Waters or his representative may also receive a prorated portion of his annual bonus based on actual performance in the event of his termination due to death or disability, andMs. CramérManhem'sManhem’s representative would be entitled to receive such abonuscash incentive in the event of her death.(3)(3)These amounts represent payments to compensate Messrs.DavisSalamone, Boxer andBoxerDavis for the difference between monthly COBRA health continuation coverage premiums paid by the NEO and the monthly premiums paid by similarly situated active participants. Such payments continue for a period of two years in the event of a CIC Qualifying Termination and one year in the event of a termination without cause or for good reason that is not a CIC Qualifying Termination. With respect toMessrs.Mr. Obertingand Waters,the amounts represent the cost to the Company fortheirhis share of the premium costs to continue medical benefits during the term of the advisory period, and with respect to Ms. Cramér Manhem, this cost represents costs to the Company to continue medical benefits during the term of the advisory period. The advisory period concludes, for Ms. Cramér Manhem, two years from the date of termination, and forMessrs. Waters andMr. Oberting, on the datethey becomehe becomes eligible forCOBRA.Medicare.(4)(4)In the event of death/disability, the amounts reported for all NEOs, represent thepro ratapro-rata value of the outstanding2017-2019 and 2018-20202018 — 2020 LTIP awards at target. In the event of retirement, the amounts reported forMr. Waters andMs. Cramér Manhem represent the full2017-2019 and 2018-20202018 — 2020 LTIP awards at the forecasted value. In the event of termination without cause or for good reason, the amounts reported in this column for all NEOs represent thefull 2017-20192018 — 2020 LTIP awards at the forecasted value, and with respect toMessrs.Mr. Obertingand Waters46
and Ms. Cramér Manhem the full value of the2018-20202018 — 2020 LTIP awards at the forecasted value pursuant to their employment agreements. In the event of a CIC Qualifying Termination, the amounts reported represent the full2017-2019 and 2018-20202018 — 2020 LTIP awards at the maximum value for the years earned and the target amount for the years unearned. The amounts reported in this column do not include the value of the vesting of the2016-20182017 — 2019 LTIP awards, whichawardawards were deemed vested and earned as of December 31,2018.2019.(5)(5)- The amounts reported in this column represent the treatment of the IPO Incentive Grant and the 2019 — 2021 restricted share units and performance shares in the event of: (i) death/disability or termination without cause or for good reason, in which the full award is reported at the target value for each of Messrs. Oberting and Waters and Ms. Cramér Manhem pursuant to their employment agreements; (ii) retirement, in which case the full award is reported at the target value for each of Mr. Waters and Ms. Cramér Manhem pursuant to their employment agreements; and (iii) a CIC Qualifying Termination, in which case the full award is reported at the target value for each of the NEOs pursuant to the 2018 Omnibus Incentive Plan.
(6)(6)ForMessrs.Mr. Obertingand Watersand Ms. Cramér Manhem, pursuant to the terms of their employment agreements, these amounts represent payments that the NEO would receive under the advisory services arrangement following an applicable termination of employment. For Ms. Cramér Manhem, the amounts additionally include the sum of the monthly payments she would receive as consideration for her entering into non-compete restrictions for a period of six months after termination. For purposes of this table, it is assumed that Ms. Cramér Manhem does not obtain any other employment and therefore receives monthly payments equal to the maximum of 60% of her base salary calculated at the time of termination. If Ms. Cramér Manhem does obtain employment during the post-termination non-compete period, these payments would be reduced by the amount of compensation received from such other employment.(7)(7)Pursuant to Mr. Waters' employment agreement, Mr. Waters is eligible to be reimbursed for the excise tax imposed under Section 4999 of the Internal Revenue Code of 1986, as amended (the "Code"), in the event that certain payments constituting "parachute payments" received by Mr. Waters in connection with a change in control are deemed "excess parachute payments" under Section 280G of the Code. If a change in control and termination of Mr. Waters employment occurred as of December 31, 2018, Mr. Waters would not have been entitled to receive any excise tax gross-ups.(8)Mr. Oberting wasneither a partyawarded 1,374,945 stock options relating toan employment agreement nor a participantSirius Group common shares. These options are not reflected in this table because theCompany's Executive Severance Plan asexercise price thereof ($12.75) exceeded the closing stock price ofDecember 31, 2018. Therefore, he would not have been entitled to any severance benefits upon a termination of employment on such date. However, because Mr. Oberting entered into an employment agreement in January 2019 and a participation agreement in February 2019, we are electing to include in the table the amounts he would have received under such arrangements assuming that they were in effectour common shares on December 31,2018.2019 ($8.74).(8)(9)Ms. CramérManhem'sManhem’s employment agreement does not provide for any type of severance in the event of the termination of her employment due to her disability. Therefore, while she would be entitled to the more favorable severance benefits if her employment terminates due to her disability under the Executive Severance Plan.As of December 31,2018,2019, we had entered into employment agreements with Mr.WatersOberting and Ms. Cramér Manhem that generally provide for minimum base salaries, annual cashbonusincentive and long term incentive opportunities under theCompany'sCompany’s annualbonuscash incentive program and long term incentive plans (subject to the achievement of annual performance goals) and severance benefits in the case of certain termination events. As of December 31,2018,2019, Messrs.Oberting,Boxer, Davis andBoxerSalamone were not parties to an employment agreement.InKernan (Kip) V. ObertingOn January 30, 2019, the Company entered into an employment agreement with Mr. Oberting, effectiveas ofFebruary 9,2019, in connection with his appointment as CEO.Allan L. WatersIn connection with our acquisition by CMIG International, we entered into an2019.Mr. Oberting’s employment agreementwith Mr. Waters, effective July 24, 2015.has an initial three-year term and automatically extends for one-year terms, unless either party provides notice of non-renewal at least 90 days prior to the expiration of the then-current term. The employment agreement binds Mr.WatersOberting to certain non-solicitation and non-competition restrictions during the term of his employment and any period during which he provides advisory services (as described below) and for a period ofone year12 months after the termination of his employment (or his advisory services, if any).The employment agreement
provided,provides, among other things, that if Sirius Groupterminatedterminates Mr.WatersOberting due to disability, or the employment agreement terminates automatically due to his death, Mr.Waters wouldOberting will receive apro rata bonuspro-rata cash incentive for the year of termination based on actual performance, and subject to47his or his representative’s execution of a release, his outstanding2016 LTIPequity awardswouldwill be treated in accordance with the 2016LTIP.LTIP and the 2018 Omnibus Incentive Plan. In the event Mr.Waters'Oberting’s employmentwasis terminated by Sirius Group without"cause,"“cause,” or Mr.Waters terminatedOberting terminates his employment for"good reason"“good reason” (each, as defined in the employment agreement), subject to his execution of a release, Sirius Groupwouldwill pay to Mr.WatersOberting a lump sum equal toMr. Waters'his then-current annual base salary, and Mr.Waters wouldOberting will receive an annualbonuscash incentive (without pro ration for time) based on actual performance but no less than the targetbonuscash incentive opportunity for the year of termination. In addition, if Mr.Waters'Oberting’s employmentterminatedterminates without cause or for good reason, or heretiredretires with the consent of Sirius Group after attaining age 62 and completing at least 10 years of service, subject to his execution of a release, hewouldwill be eligible to remain as an advisor to Sirius Group under his employment agreement. The term of Mr.Waters'Oberting’s advisory services under his employment agreementwould commencecommences on a qualifying termination of employment andcontinuecontinues until the later of (i) the first date on which the expiration of his COBRA participation under SiriusGroup'sGroup’s applicable health plan would result in immediate Medicare eligibility(April 2021)and (ii) the last date on which his outstanding long-term incentive awards areearnedeligible to vest in accordance with their terms. However, the advisory services period will terminate automatically if Mr. Oberting obtains employment during such period, and the advisory services period may also be terminated early for cause, due to death or disability, or by Mr. Oberting for any reason. During the advisory services period, Mr.Waters wouldOberting will receive an annual base salary of $30,000 and continued health care coverage, and his outstanding long-term incentive awardswouldwill continue to vest in accordance with their terms.However, the advisory services period would terminate automatically if Mr. Waters obtained employment during such period, and the advisory services period could also be terminated early for cause, due to death or disability, or by Mr. Waters for any reason. In the event of a termination of Mr. Waters' employment without cause or due to good reason that results in the payment of excise taxes under Section 4999 of the Code, Mr. Waters would be entitled to an additional payment equal to such excise taxes.As of December 31,
2018,2019, Mr.Waters didOberting was notparticipateeligible for this additional retirement payment.Mr. Oberting commenced participation in theCompany'sExecutive SeverancePlan.
duplicative benefits under the Executive Severance Plan.On January 30, 2019,Plan in February 2019. The Executive Severance Plan provides that, to theBoard approved a succession plan pursuant to whichextent that Mr.Oberting replaced Mr. Waters as CEO of the Company, effective as of February 9, 2019. As Mr. Waters' separation was a termination without "cause" (as defined in his employment agreement), he received a lump sum payment equal to his annual base salary immediately before his separation and an annual bonus payment for 2018 based on actual performance. Additionally, at the time that 2019 annual bonuses are paid to other bonus-eligible employees, Mr. Waters will receive a payment in connection with his 2019 annual bonus based on actual performance but equal to at least his target. Pursuant to Mr. Waters'Oberting’s employment agreementand in accordance with the terms relatingentitles him toadvisory services as described in the foregoing paragraph, he will provide advisory services to the Company for a period of time during which periodadditional severance protections, he will continue tovestbe eligible for the severance under the employment agreement to the extent such severance does not result inpending long-term incentive awards in accordance with his employment agreement.Monica Cramér Manhem
In connection with our acquisition by CMIG International, we entered into an employment agreement with Ms. Cramér Manhem, effective July 24, 2015. The employment agreement does not have a fixed term. The employment agreement binds Ms. Cramér Manhem to certain non-solicitation and non-competition restrictions during the term of her employment and any period during which she provides advisory services (as described below) and for a period of six months after the termination of her employment (or her advisory services, if any). During the post-termination non-compete period, Ms. Cramér Manhem is eligible to receive additional monthly payments from Sirius Group equal to the difference between compensation received from any other employment and her base salary from Sirius Group, with no payment to exceed 60% of her monthly base salary at the time of such termination of employment, and which payments will equal 60% of such base salary if she is not employed during such period. However, no monthly payments are available during any period during which Ms. Cramér Manhem receives severance from Sirius Group or if her employment is terminated due to retirement or her material breach of the employment agreement.The employment agreement provides that if Ms. CramérManhem'sManhem’s employment terminates due to death, Ms. Cramér Manhem will receive apro rata bonuspro-rata cash incentive for the year of termination based on actual performance, and her outstanding 2016 LTIP awards will be treated in accordance with the 2016 LTIP. In the event Ms. CramérManhem'sManhem’s employment is terminated by Sirius Group without"cause,"“cause,” or Ms. Cramér Manhem terminates her employment for"good reason"“good reason” (each, as defined in the employment agreement), subject to her execution of a release, Sirius Group will pay Ms. Cramér Manhem a lump sum equal to her then-current annual base salary, and she will receive an annualbonuscash incentive (withoutpro rationpro-ration for time) based on actual performance but no less than the targetbonuscash incentive opportunity for the year of termination. In addition, if Ms. CramérManhem'sManhem’s employment terminates without cause or for good reason, or she retires with the consent of Sirius Group, subject to her execution of a release, she will be eligible to remain as an advisor to Sirius Group under her employment agreement. The term of Ms. CramérManhem'sManhem’s advisory services under her employment agreement commences on a qualifying termination of employment and continues until the earlier of the second anniversary of such termination and the last date on which her outstanding long-term incentive awards are eligible to vest in accordance with their terms.48However, the advisory services period will terminate automatically if Ms. Cramér Manhem obtains employment during such period, and the advisory services period may also be terminated early for cause, due to death, or by Ms. Cramér Manhem for any reason. During the advisory services period, Ms. Cramér Manhem will receive an annual base salary of $30,000 and continued health care coverage, and her outstanding long-term incentive awards will continue to vest in accordance with their terms. The employment agreement also provides that in the event of Ms. CramérManhem'sManhem’s retirement between the ages of 64 and 65, Ms. Cramér Manhem will receive an additional payment equal to 75% of her pensionable salary, as determined under the occupational pension plan provided in Sweden. As of December 31,2018,2019, Ms. Cramér Manhem was not eligible for this additional retirement payment.As of December 31,2018,2019, Ms. Cramér Manhem was a participant in theCompany'sCompany’s Executive Severance Plan, as described below. The Executive Severance Plan provides that, to the extent that Ms. CramérManhem'sManhem’s employment agreement entitles her to additional severance protections, she will continue to be eligible for the severance under the employment agreement to the extent such severance does not result in duplicative benefits under the Executive Severance Plan.
Executive Severance PlanKernan (Kip) V. ObertingOn January 30, 2019, the Company entered into an employment agreement with Mr. Oberting, effective February 9, 2019. While Mr. Oberting was not a party to an employment agreement on December 31,In September 2018,or a participant inSirius Group adopted theCompany'sExecutive Severance Plan, which provides for severance terms applicable to each of our participating NEOs relating to severance and post-employment benefits provided upon certain termination events. All of our NEOs currently participate in the Executive Severance Plan. In general, the Executive Severance Plan provides our NEOs with severance in the event of an involuntary termination without cause or a resignation by the NEO for good reason. For these qualifying terminations of employment prior to a change in control, our NEOs will receive severance benefits equal to one times base salary, any earned but unpaid annual cash incentive for thepurposes of the table above, we have elected to include in the table the amounts he would have received under such arrangements assuming they were in effect on December 31, 2018.Mr. Oberting's employment agreement has an initial three-year term and automatically extends for one-year terms, unless either party provides notice of non-renewal at least 90 daysyear prior tothe expiration of the then-current term. The employment agreement binds Mr. Oberting to certain non-solicitation and non-competition restrictions during the term of his employment and any period during which he provides advisory services (as described below) and fortermination, aperiod of 12 months after the termination of his employment (or his advisory services, if any).The employment agreement provides, among other things, that if Sirius Group terminates Mr. Oberting due to disability, or the employment agreement terminates automatically due to his death, Mr. Oberting will receive a pro rata bonuspro-rata annual cash incentive for the year of termination with the payoutfor such cash incentive based on actual performance, andsubject to his or his representative's execution of a release, his outstanding equity awards will be treated in accordance with the 2016 LTIP and the 2018 Omnibus Incentive Plan.medical continuation benefits for 12 months. In the eventMr. Oberting's employment is terminated by Sirius Group without "cause," or Mr. Oberting terminates his employment for "good reason" (each, as defined in the employment agreement), subject to his executionofa release, Sirius Group will pay to Mr. Oberting a lump sum equal to his then-current annual base salary, and Mr. Oberting will receive an annual bonus (without pro ration for time) based on actual performance but no less than the target bonus opportunity for the year of termination. In addition, if Mr. Oberting's employment terminates without cause or for good reason, or he retires with the consent of Sirius Group after attaining age 62 and completing at least 10 years of service, subject to his execution of a release, he will be eligible to remain as an advisor to Sirius Group under his employment agreement. The term of Mr. Oberting's advisory services under his employment agreement commences onsuch a qualifying termination of employmentand continues untilwithin 24 months following a change in control, thelater ofseverance benefits are the same, except (i) thefirst date on which the expiration of his COBRA participation under Sirius Group's applicable health plan would result in immediate Medicare eligibility andseverance pay is increased to two times base salary; (ii) thelast date on which hismedical continuation period is increased to two years for the NEOs; (iii) the prorated annual cash incentive for the year of termination is paid at the target level of performance; and (iv) all outstandinglong-term incentiveequity compensation awardsare eligible to vest in accordancewill become fully vested, withtheir terms. However,theadvisory services period will terminate automatically if Mr. Oberting obtains employment during such period, andattainment or deemed attainment of any applicable performance conditions determined under theadvisory services periodterms of the applicable equity compensation plan or award agreements. Our NEOs may also beterminated early for cause, dueentitled todeath or disability, or by Mr. Oberting for anymore limited severance benefits in the event the Company chooses to enforce the non-compete restrictive covenant upon a resignation of the NEO without good reason.During the advisory services period, Mr. ObertingIn such event, our NEOs will receivean annualbase salary and health benefits during the term of$30,000 and continued health care coverage, and his outstanding long-term incentive awards will continuethe non-compete. In all cases, in order tovest in accordance with their terms.As of December 31, 2018, Mr. Oberting was not a participant in the Company's Executive Severance Plan. However, Mr. Oberting commenced participation inbe eligible to receive severance payments, pursuant to the Executive Severance Plan, the NEO must execute a release inFebruary 2019.the Company’s favor.The Executive Severance Plan provides that, to the extent that Mr.Oberting'sOberting’s or Ms. Cramér Manhem’s employmentagreement entitles him toagreements provide additional severance protections,hethey will continue tobe eligible for the severance underreceive the employment agreement severance protections, to the extentsuch severance doesthey do not result in duplicative benefits under the Executive Severance Plan.Waters Separation AgreementOn January 30, 2019, the Board approved a succession plan pursuant to which Mr. Oberting replaced Mr. Waters as CEO of the Company, effective as of February 9, 2019. As Mr. Waters’ separation was a termination without “cause” (as defined in his employment agreement), he received a lump sum payment equal to his annual base salary immediately before his separation ($500,000). Additionally, at the time that 2019 annual cash incentives were paid to other cash incentive-eligible employees, Mr. Waters received a payment equal to his target incentive ($250,000). Pursuant to Mr. Waters’ employment agreement and in accordance with the terms relating to advisory services as described in the foregoing paragraph, he will provide advisory services to the Company for a period of time during which period he will continue to vest in pending long-term incentive awards in accordance with his employment agreement (estimated value of $9,812,295, based on the closing stock price of $14.50 on January 30, 2019), be paid $30,000 per year and receive continued health care coverage (estimated value of $8,596 for the advisory period).492016 LTIPThe 2016 LTIP under which the NEOs hold outstanding performance shares provides for accelerated or continued vesting of outstanding equity awards upon certain qualifying terminations of employment. In general, each performance share award is subject to a three-year performance cycle but may be accelerated in the case of a termination due to disability, retirement or death. If a participant dies or becomes disabled, the performance shares will immediately accelerate on a pro-rata basis. If a participant retires, then the 2016 LTIP provides that the Compensation Committee may accelerate vesting in its sole discretion. In addition, as noted in the"Employment Arrangements"“Employment Arrangements” section above,Messrs.Mr. Obertingand Waters'and Ms. CramérManhem'sManhem’s employment agreements provide for continued vesting during a period of service as an advisor following a termination without cause, a resignation for good reason or retirement with the consent of Sirius Group (and in the case of Mr. Oberting, retirement also requires him to meet certain age and service requirements).In the event that an NEO experiences a termination without cause or constructive termination or there is an adverse change to the 2016 LTIP, each within 24 months following a change in control, the portion of each outstanding award for which time-based vesting has already occurred will pay out at the maximum, and the remaining portion will immediately accelerate on a pro-rata basis at the greater of actual performance and target, with the underlying share value determined based on the greatest of the value of a common share: (A) immediately prior to the change in control; (B) five business days after the change in control; and (C) on the date of termination.
As noted in the CD&A, theThe 2016 LTIP was amended in 2018 to provide for continued vesting in the case of a termination by the Company without cause or by the participant for good reason other than during the 24-month period following a change in control. For these qualifying terminations of employment, our NEOs will continue to vest in outstanding awards for 12 months following such termination of employment. The ability to receive payments during these vesting continuation periods will be subject to actual performance.Subject to the terms of the applicable award agreement, upon a"change“change incontrol"control” (as defined in the 2018 Omnibus Incentive Plan), the Board may, in its discretion, determine whether some or all outstanding options and share appreciation rights will become exercisable in full or in part, whether the restriction period and performance period applicable to some or all outstanding restricted share awards and restricted share unit awards will lapse in full or in part and whether the performance measures applicable to some or all outstanding awards will be deemed to be satisfied. The Board may further require that shares of stock of the surviving entity resulting from such a change in control, or a parent thereof, be substituted for some or all of the common shares subject to an outstanding award and that any outstanding awards, in whole or in part, be surrendered to us by the holder and be immediately cancelled by us in exchange for a cash payment, shares of capital stock of the corporation resulting from or succeeding us or a combination of both cash and such shares of stock.
CEO Pay Ratio DisclosureTableAs required by Section 953(b) ofContentsAs discussed intheCD&A, in September 2018, Sirius Group adoptedDodd-Frank Wall Street Reform and Consumer Protection Act, theExecutive Severance Plan, which provides for severance terms applicable to eachCompany is providing the following disclosure about the relationship of the annual total compensation of ourparticipating NEOs relatingcoworkers toseverance and post-employment benefits provided upon certain termination events. Allthe annual total compensation of Mr. Oberting, ourcontinuing NEOs currently participate inCEO.We selected December 31, 2019 to identify our median employee. To identify our median employee, we determined theExecutive Severance Plan. In general, the Executive Severance Plan provides our NEOs with severance in the eventsum ofan involuntary termination without cause or a resignation by the NEO for good reason. For these qualifying terminations of employment prior to a change in control, our NEOs will receive severance benefits equal to one times2019 gross annual compensation, which included base salary,any earned but unpaidannualbonuscash incentive and equity-based incentive award for each individual, excluding Mr. Oberting, who were employed by us on December 31, 2019. As of December 31, 2019, we employed 1,075 people worldwide. For our employees who were paid in currency other than U.S. dollars, these amounts were converted into U.S. dollars at theyear prior to termination, a pro-rata annual bonusapplicable exchange rate on December 31, 2019. We included all employees, whether full-time or part-time. We annualized the compensation for full-time and part-time employees that were not employed by us for all of 2019. Once we identified theyear of terminationmedian employee, we calculated such employee’s compensation in accordance with thepayoutrules used to calculate compensation forsuch bonus based on actual performance, and medical continuation benefits for 12 months. In the event of such a qualifying termination of employment within 24 months following a change in control, the severance benefits are the same, except (i) the severance pay is increased to two times base salary; (ii) the medical continuation period is increased to two years for the NEOs; (iii) the prorated annual bonus for the year of termination is paid at the target level of performance; and (iv), all outstanding equity compensation awards will become fully vested, with the attainment or deemed attainment of any applicable performance conditions determined under the termspurposes of theapplicable equity2019 Summary Compensation Table. Although Mr. Oberting was promoted to the position of CEO following the commencement of 2019, we did not annualize his compensation,plan or award agreements. Our NEOs may also be entitled to more limited severance benefits in the event the Company chooses to enforce the non-compete restrictive covenant uponas he did not receive aresignation of the NEO without good reason. In such event, our NEOs will receivebase salary,and health benefitsbonus or long-term incentives duringthe term of the non-compete. In all cases, in order to be eligible to receive severance payments, pursuant to the Executive Severance Plan, the NEO must execute a release in the Company's favor.The Executive Severance Plan provides that, to the extent that Mr. Oberting's or Ms. Cramér Manhem's employment agreements provide additional severance protections, they will continue to receive the employment agreement severance protections, to the extent they do not result in duplicative benefits under the Executive Severance Plan.Equity Compensation Plan Information2019. The following table sets forth
certain informationthe ratio of Mr. Oberting’s annual total compensation asof December 31, 2018 about our common shares that may be issued upon the settlement of equity awards under all compensation plans under which equity securities are reserved for issuance.reported inPlan CategoryNumber of securities to be
issued upon exercise of
outstanding options, warrants
and rights (a)(1)Weighted-average exercise
price of outstanding options,
warrants and rights (b)Number of securities
remaining available for future
issuance under equity
compensation plans (excluding
securities reflected in
column (a)) (c)(2)Equity compensation plans approved by security holders
756,183 N/A 13,334,246 Equity compensation plans not approved by security holders
N/A N/A N/A Total
756,183 N/A 13,334,246 50(1)Reflectsthetarget number2019 Summary Compensation Table to the annual total compensation ofcommon shares of the Company to be awarded upon the vesting of the IPO Incentive Grant at target performance; actual vesting is based upon actual ROE performance relative to target and can vary between 0% and 150%. This column excludes shares that may be issued pursuant to outstanding performance shares under the 2016 LTIP. When vested, (i) each performance share will be valued at the market price at time of payout and (ii) the Compensation Committee has discretion to settle these awardsour median employee, calculated incommon shares, rather than cash.(2)Includes shares reserved for issuance under the 2018 Omnibus Incentive Plan and the 2016 LTIP. As noted above, the Compensation Committee retains the discretion to settle outstanding awards under the 2016 LTIP in common shares. No further equity awards will be made under the 2016 LTIP. The maximum number of shares that may be issued in connectionaccordance with theoutstanding performance shares granted under the 2016 LTIP is 4,345,269. Annual
Total
Compensation Kernan V. Oberting $ 5,426,748 Median Employee $ 95,010 Ratio 57:1 51
PROPOSAL TWO
ADVISORY VOTE TO APPROVE THE COMPENSATION OF
OUR
NAMED EXECUTIVE OFFICERSAs required by Section 14A of the Exchange Act, we are asking our shareholders to vote, on an advisory basis, to approve the compensation of our named executive officers as described in this proxy statement. We believe that the compensation policies for the named executive officers are designed to attract, motivate and retain talented executive officers and are aligned with the long-term interests of our shareholders. Shareholders are urged to read the Compensation Discussion and Analysis, which discusses in detail how our compensation policies and procedures implement our compensation philosophy.In this advisory shareholder vote, commonly referred to as a"say-on-pay"“say-on-pay” vote, we are asking shareholders to indicate their support for our named executiveofficer'sofficers’ compensation as described in this proxy statement. This vote is not intended to address any specific item of compensation, but rather the overall compensation of our named executive officers and the philosophy, policies and practices described in this proxy statement.At our 2019 annual meeting, approximately 99% of the votes cast were in favor of the “say-on-pay” proposal.
The vote is advisory, which means that the vote is not binding on the Company, our Board or the Compensation Committee. However, the Compensation Committee, which is responsible for designing and administering theCompany'sCompany’s executive compensation program,valuesand the Board value the opinions expressed by shareholders in their vote on this proposal and will consider the outcome of the vote when making future compensation decisions for named executive officers.In light of the voting results at our 2019 annual meeting with respect to the frequency of holding a “say-on-pay” vote, the Board has determined that the Company will hold “say-on-pay” votes every year until the next non-binding advisory vote of shareholders on the frequency of “say-on-pay” votes in 2026, or until the Board otherwise determines a different frequency for such non-binding advisory votes.Accordingly, the following resolution is submitted to shareholders for an advisory vote at the annual meeting:RESOLVED, that theCompany'sCompany’s shareholders approve, on an advisory basis, the compensation of theCompany'sCompany’s named executive officers, as disclosed in this proxy statement pursuant to the compensation disclosure rules of the SEC, which disclosure includes the Compensation Discussion and Analysis, the Summary Compensation Table and the other related tables and disclosure in this proxy statement.OUR BOARDUNANIMOUSLYRECOMMENDS THAT OUR SHAREHOLDERS VOTE"FOR"“FOR” THE APPROVAL, ON AN ADVISORY BASIS, OF THE COMPENSATION OF OUR NAMED EXECUTIVE OFFICERS AS DISCLOSED IN THIS PROXY STATEMENT.52PROPOSAL THREEADVISORY VOTE TO APPROVE THE FREQUENCY OF AN ADVISORY VOTE ONTHE COMPENSATION OF OUR NAMED EXECUTIVE OFFICERSAs required by Section 14A of the Exchange Act, in addition to providing shareholders with the opportunity to cast an advisory vote on executive compensation, commonly referred to as a "say-on-pay" vote, we are also providing shareholders with the opportunity to cast an advisory vote on whether the advisory vote on executive compensation should be held every one, two or three years, commonly known as a "say-on-frequency" vote.Our Board values shareholders' opinions and believes it would benefit from direct, timely feedback on the Company's executive compensation program. Accordingly, after careful consideration, our Board has recommended a frequency of every one year for the say-on-pay vote. We believe that say-on-pay votes should be conducted every year so that our shareholders have an opportunity to express their views on our executive compensation programs, policies and practices on an annual basis. Setting a period of one year for say-on-pay votes will provide shareholders with an opportunity to annually assess the effectiveness of our executive compensation programs, while providing us with timely feedback from our shareholders about our compensation structure. An annual say-on-pay vote will provide the highest level of accountability and communication, as it gives us an opportunity each year to engage in a dialogue with our shareholders to better understand the results of the advisory vote and to respond swiftly to shareholder feedback by making adjustments to our compensation practices, as appropriate. We also believe that from a corporate governance perspective, an annual say-on-pay vote would ensure procedural consistency from year to year.The proxy card provides shareholders with the opportunity to choose among four options (holding the vote every one, two or three years, or abstaining). The following resolution is submitted to shareholders for an advisory vote at the annual meeting:RESOLVED, that the shareholders advise the Company to hold a non-binding advisory shareholder vote to approve the compensation paid to the Company's named executive officers every:•one year;•two years; or•three years.
The affirmative vote of the majority of the votes cast at the annual meeting is required to approve one year, two years, or three years as the shareholders' recommended frequency on this proposal. However, if none of the options receives the vote of a majority, the option receiving the greatest number of votes will be considered the frequency recommended by our shareholders. As this is an advisory vote, the results will not be binding on the Company, our Board or the Compensation Committee. Our Board may decide that it is in the best interest of our shareholders to hold the advisory vote on the compensation of our named executive officers more or less frequently than the option recommended by our shareholders. However, our Board and the Compensation Committee will consider the voting results, as appropriate, when determining the frequency of such future votes.OUR BOARD UNANIMOUSLY RECOMMENDS A VOTE FOR THE FREQUENCY OF "ONE YEAR" FOR FUTURE ADVISORY VOTES ON THE COMPENSATION OF OUR NAMED EXECUTIVE OFFICERS.REPORT OF THE AUDIT & RISK MANAGEMENT COMMITTEEThe following Report of the Audit & Risk Management Committee does not constitute "soliciting material" and shall not be deemed "filed" or incorporated by reference into any filing under the Securities Act of 1933, as amended (the "Securities Act"), or the Securities Exchange Act of 1934, as amended (the "Exchange Act"), except to the extent the Company specifically requests that the information be treated as soliciting material or specifically incorporates such information by reference into a document filed under the Securities Act or the Exchange Act.Management is responsible for the preparation and presentation of Sirius Group's consolidated financial statements, its accounting and financial reporting principles and for the establishment and effectiveness of internal controls and procedures designed to ensure compliance with accounting standards and applicable laws and regulations. The independent auditor is responsible for performing an audit of the consolidated financial statements in accordance with the standards of the Public Company Accounting Oversight Board ("PCAOB") and expressing an opinion on the conformity of the audited consolidated financial statements with generally accepted accounting principles of the United States of America and expressing an opinion on the effectiveness of internal control over financial reporting. The independent auditors have free access to the Audit & Risk Management Committee to discuss any matters they deem appropriate.The Audit & Risk Management Committee assists the Board in its oversight of the quality and integrity of the accounting, auditing and financial reporting processes of Sirius Group. Its primary responsibilities include the oversight of:•The Company's accounting and financial reporting processes and the audit of the Company's financial statements;•The Company's compliance with legal and regulatory requirements;•The qualifications, independence and performance of the Company's external independent auditor; and•The performance of the Company's internal auditing department.
The Audit & Risk Management Committee has established a Charter which outlines its primary duties and responsibilities. The Audit & Risk Management Committee Charter, which has been approved by the Board, is reviewed at least annually, is updated as necessary and is available for viewing at http://ir.siriusgroup.com/.In the performance of its oversight function, the Audit & Risk Management Committee has considered and discussed with management and the Company's independent auditor, PricewaterhouseCoopers LLP ("PwC"), the Company's audited consolidated financial statements for the year ended December 31, 2018, and the Company's disclosures in the section entitled "Management's Discussion and Analysis of Results of Operations and Financial Condition" in the Company's Annual Report on Form 10-K for the year ended December 31, 2018. The Audit & Risk Management Committee has met with each of the Company's Senior Vice President, Global Head of Internal Audit and PwC's senior engagement partners, with and without management present, to discuss audit results, their evaluations of the Company's internal controls and the overall quality of the Company's financial reporting. In addition, the Audit & Risk Management Committee has discussed with PwC the matters required to be discussed pursuant to the applicable requirements of the PCAOB and the SEC. Finally, the Audit & Risk Management Committee has received the written disclosures and the letter from PwC required by the applicable requirements of the PCAOB regarding the independent accountant's communications with the Audit & Risk Management Committee concerning independence, and has discussed with PwC the firm's independence from the Company.Based upon the reports and discussion described in this report, the Audit & Risk Management Committee, in accordance with its responsibilities, recommended to the Board, and the Board approved, inclusion of the audited financial statements for the year ended December 31, 2018 in Sirius Group's 2018 Annual Report on Form 10-K.Audit & Risk Management CommitteeRachelle C. Keller (Chair)Robert L. FriedmanAlain M. KaraoglanPROPOSAL FOUR
APPROVAL OF PRINCIPAL INDEPENDENT REGISTERED
CERTIFIED PUBLIC ACCOUNTING FIRM AND RATIFICATION
OF REMUNERATIONThe Audit & Risk Management Committee has appointed PwC to serve as our independent registered certified public accounting firm for the year ending December 31,2019.2020. As required by our bye-laws and applicable law, the appointment of PwC and the fixing ofPwC'sPwC’s remuneration must be approved by the shareholders at the annual meeting. If shareholders do not approve the appointment of PwC and ratify the Auditand& RiskCommittee'sManagement Committee’s determination ofPwC'sPwC’s remuneration, the Audit & Risk Management Committee will consider the appointment of another independent registered certified public accounting firm.Representatives of PwC areexceptedexpected to be present at the annual meeting and will have an opportunity to make a statement if they desire to do so and to be available to respond to appropriate questions.The services performed by PwC in20182019 and20172018 are described below. PwC does not provide any services to the Company prohibited under applicable laws and regulations. From time to time, PwC may perform permissible consulting services for the Company, provided they have been pre-approved in accordance with the policy described below. To the extent consulting services are provided by PwC, they are closely monitored and controlled by both management and the Audit & Risk Management Committee to ensure that their nature and extent do not interfere with the independence of PwC. The independence of PwC is also considered annually by the Audit & Risk Management Committee.Aggregate fees for professional services rendered by PwC for the years ended December 31, 2019 and 2018and 2017were: Total Fees Year Ended
December 31, 2019 2018 (in thousands) Audit fees(a) $ 4,851,831 $ 9,106,659 Audit-related fees(b) 89,165 100,688 Tax fees(c) 126,138 164,467 All other fees(d) 16,111 33,742 Total $ 5,083,245 $ 9,405,556 Total Fees Year Ended
December 31,2018 2017 (in thousands) Audit fees(a)
$ 8,420,232 $ 3,462,393 Audit-related fees(b)
128,624 2,943,691 Tax fees(c)
164,467 257,522 All other fees(d)
15,000 102,408 Total
$ 8,728,323 $ 6,766,014
(a)(a)- The fees in this category were for professional services rendered in connection with (i) the audits of the
Company'sCompany’s annual financial statements, (ii) the review of theCompany'sCompany’s quarterly financial statements included in its Quarterly Reports on Form 10-Q, (iii) audits of theCompany'sCompany’s subsidiaries, (iv) engagements required by federal, state or foreign regulatory agencies, and (v) services that generally only theCompany'sCompany’s independent registered public accounting firm reasonably can provide, such as comfort letters and consents. Fees for fiscal year 2018 also consisted of professional services rendered in connection with the filing of theCompany'sCompany’s Registration Statements on Forms S-1 and S-4 in connection with the Merger. The fees reported include expense reimbursements of out-of-pocket expenses of$70,540$75,463 and$118,308$89,127 in 2019 and 2018,and 2017,respectively.
(b)(b)The fees in this category were for professional services rendered in connection with(i)actuarial certifications of loss reserves in20182019 and2017 and (ii) due diligence related to certain transactions in 2017.2018.(c)(c)The fees in this category were for professional services rendered in connection with tax consulting, planning and compliance services.(d)(d)The fees in this category were for access toPwC'sPwC’s proprietary technical research and actuarial software.
The Audit & Risk Management Committee, pursuant to its policy, pre-approves the scope and fees for all services performed by PwC. Annually, the Audit & Risk Management Committee receives and pre-approves a report describing the engagement terms and fees of audit services to be provided by PwC.53All other audit, audit-related and non-audit-related services rendered by PwC also require pre-approval. Such pre-approval can be given as part of the Auditand& RiskCommittee'sManagement Committee’s approval of the scope of the engagement of the independent registered certified public accounting firm or on an individual basis.The Audit & Risk Management Committee is authorized to delegate the pre-approval of audit and permitted non-audit services to one or more of its members,and, pursuant to this authority,provided that any decisions to pre-approve any audit or non-audit services must be presented to the full Audit & Risk Management Committee at its next scheduled meeting. The Audit & Risk Management Committee pre-approved all of the non-audit services provided by PwC in20182019 and2017.2018.
The Audit & Risk Management Committee has considered and determined that the services provided by PwC are compatible with maintainingPwC'sPwC’s independence.OUR BOARD AND OUR AUDIT & RISK MANAGEMENT COMMITTEEUNANIMOUSLYRECOMMEND THAT OUR SHAREHOLDERS VOTE"FOR"“FOR” THE APPROVAL OF THE SELECTION OF PwC AS OUR PRINCIPALINDEPENDENT AUDITORREGISTERED CERTIFIED PUBLIC ACCOUNTING FIRM FOR THE YEAR20192020 AND RATIFICATION OF THE AUDIT & RISK MANAGEMENTCOMMITTEE'SCOMMITTEE’S DETERMINATION OFPwC'sPwC’s REMUNERATION.54SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENTThe following table sets forth information regarding the beneficial ownership of Sirius Group common shares and Series B preference shares as ofMarch 29, 2019,November 1, 2020, by:•each person who is the beneficial owner of more than 5% of theCompany'sCompany’s common shares and Series B preference shares;••each person who is a named executive officer or director; and••all executive officers and directors as a group.Beneficial ownership is determined according to the rules of the SEC, which generally provide that a person has beneficial ownership of a security if he, she or it possesses sole or shared voting or investment power over that security, including options and warrants that are currently exercisable or exercisable within 60 days. As ofMarch 29, 2019,November 1, 2020, there were115,262,302115,299,341 common shares and 11,901,670 Series B preference shares of Sirius Group outstanding. Unless otherwise indicated below, the address of each named person is c/o Sirius International Insurance Group, Ltd., 14 Wesley Street, Hamilton HM 11, Bermuda.Percentage of total voting power represents voting power with respect to all shares of Sirius Group common shares and Series B preference shares, voting as a single class. Each holder of common shares is entitled to one vote for each common share held on the record date. Each holder of Series B preference shares is entitled to the number of votes equal to the number of common shares into which the preference shares are then convertible as of the record date. As of the record date, each share of Series B preference shares
iswas convertible into one common share. Common Shares Series B Preference Shares % of Total
Voting Power Name of Beneficial Owner(1) Number of
Shares % of Class Number of
Shares % of Class CM Bermuda(2)
Cannon’s Court
22 Victoria Street
Hamilton, HM12, Bermuda
CMIG International
8 Marina Boulevard #13-01,
Marina Bay Financial Centre, Tower 1
Singapore 018981. CMIG
25F, The Bund Square Plaza
100 South Zhongshan Street,
Shanghai, P.R. China, 200010 110,480,720 95.8% — — 87% Allan L. Waters(3) 500,000 * — — * Kernan (Kip) V. Oberting 132,322 * — — * Ralph A. Salamone 7,129 Gene Boxer 8,049 * — — * Monica Cramér Manhem 20,267 * — — * Jeffrey W. Davis(4) 63,474 * — — * Sabrina Maguire — — — — — Robert L. Friedman(5) 42,953 * — — * Meyer (Sandy) Frucher(5) 17,377 * — — * Alain Karaoglan(5) 9,728 * — — * Rachelle Keller(5) 9,728 * — — * James (Jim) B. Rogers, Jr.(5) 10,832 * — — * Bain Capital Special Situations Asia, L.P.(6)
200 Clarendon Street
Boston, MA 02116 832,127 * 1,451,423 12% 1.7% Common Shares Series B Preference
SharesName of Beneficial Owner(1)Number of
Shares% of Class Number of
Shares% of Class % of Total
Voting PowerCM Bermuda Ltd.(2)
110,480,720 96 % — — 87 % Allan L. Waters
500,000 * — — * Kernan (Kip) V. Oberting
43,322 * — — * Monica Cramér Manhem
19,967 * — — * Gene Boxer
8,049 * — — * Jeffrey W. Davis
53,474 * — — * Laurence Liao
— — — — — Robert L. Friedman(3)
36,030 — — — * Meyer (Sandy) Frucher(3)
8,030 * — — * Alain Karaoglan(3)
2,805 * — — * Rachelle Keller(3)
2,805 * — — * James (Jim) B. Rogers, Jr.(3)
3,805 * — — * Bain Capital Special Situations Asia, L.P.(4)
200 Clarendon Street
Boston, MA 02116832,127 * 1,451,423 12 % 1 % CCOF Master, L.P.(5)
1001 Pennsylvania Avenue, N.W., Suite 220 South
Washington, D.C. 200041,799,701 1.5 % 3,483,416 29 % 4 % Centerbridge Credit Partners Master, LP(6)
375 Park Avenue, 11th Floor
New York, NY 101521,247,757 1 % 2,673,870 22 % 3 % Centerbridge Special Credit Partners III, LP(7)
375 Park Avenue, 11th Floor
New York, NY 10152377,773 * 809,546 7 % * GPC Partners Investments (Canis) LP(8)
660 Steamboat Road
Greenwich, CT 068301,625,530 1.3 % 3,483,415 29 % 4 % All directors and executive officers as a group (12 individuals)
685,416 * — — * 55 Common Shares Series B Preference Shares % of Total
Voting Power Name of Beneficial Owner(1) Number of
Shares % of Class Number of
Shares % of Class CCOF On-Shore Co-Borrower LLC(7)
1001 Pennsylvania Avenue, N.W.,
Suite 220 South Washington, D.C. 20004 1,799,701 1.5% 3,483,416 29% 4% Centerbridge Credit Partners Master, LP(8)
375 Park Avenue, 11th Floor
New York, NY 10152 1,247,757 1% 2,673,870 22% 3% Centerbridge Special Credit Partners III, LP(9)
375 Park Avenue, 11th Floor
New York, NY 10152 377,773 * 809,546 7% * GPC Partners Investments (Canis) LP(10)
660 Steamboat Road
Greenwich, CT 06830 1,625,530 1.3% 3,483,415 29% 4% All directors and executive officers as a group (11 individuals) 811,859 * — — * *Less than one percent.(1)(1)Except as described in the footnotes below and subject to applicable community property laws and similar laws, Sirius Group believes that each person listed above has sole voting and investment power with respect to such shares.Unless otherwise indicated,(2)China Minsheng Investment Group Corp., Ltd. (“CMIG”) is thebusiness addresscontrolling shareholder ofeach of the directors and executive officers in this table is 14 Wesley Street, Hamilton HM 11, Bermuda.(2)- CMIG International. CM Bermuda is a
direct wholly ownedwholly-owned subsidiary of CMIG International.The Board ofAccording to the Schedule 13G jointly filed by CMIG, CMIG Internationalwhich is comprised of seven members exercisesand CM Bermuda on July 27, 2020, each entity shares voting and dispositivecontrolpower over 110,480,720 shares of the Company’s common stock.(3)Information provided is based upon most recent records of the Company.(4)Mr. Davis sharesheld by CM Bermuda. The business address of CM Bermuda is Cannon's Court, 22 Victoria Street, Hamilton, HM12, Bermudavoting andthe business address of CMIG International is 8 Marina Boulevard #13-01, Marina Bay Financial Centre, Tower 1, Singapore 018981.investment power with his spouse.(5)(3)- Includes the following restricted shares granted to Messrs. Friedman,
8,030,6,923, Frucher,8,030,6,923, Karaoglan,2,8056,923, and Rogers,2,8056,923, and Ms. Keller,2,8056,923, onNovember 5, 2018May 23, 2019 and 2,424 restricted shares granted to Mr. Frucher on August 22, 2019 and which will vest onMay 23, 2019,the date of the annualmeeting, except that with respect to Messrs. Friedman and Frucher, 5,225 restricted shares vest one year from the date of grant.meeting.
(6)(4)Includes 541,843 common shares issuable upon exercise of warrants.(7)(5)Includes 1,625,531 common shares issuable upon exercise of warrants. CCOF Master LLP, an affiliate of CCOF On-Shore Co-Borrower LLC, holds 174,170 common shares.(8)(6)Includes 1,247,757 common shares issuable upon exercise of warrants.(9)(7)Includes 377,773 common shares issuable upon exercise of warrants.(8)(10) Includes 1,625,530 common shares issuable upon exercise of warrants.56
ADDITIONAL INFORMATIONWe will bear the entire cost of solicitation, including the preparation, assembly, printing and mailing of this proxy statement, the proxy card and any additional solicitation materials we furnish to our shareholders. Copies of theCompany'sCompany’s solicitation materials will be furnished to brokerage houses, fiduciaries and custodians holding shares in their names that are beneficially owned by others so that they may forward this solicitation material to such beneficial owners. Upon request, we will reimburse such persons for their costs in forwarding such solicitation materials to such beneficial owners.The SEC has adopted rules that permit companies and intermediaries (e.g., brokers) to satisfy the delivery requirements for proxy statements, annual reports and notices of internet availability of proxy materials with respect to two or more shareholders sharing the same address by delivering a single copy of the applicable document(s) addressed to those shareholders. This process, which is commonly referred to as"householding,"“householding,” potentially means extra convenience for shareholders and cost savings for companies.Brokers with account holders who are shareholders of the Company may be"householding"“householding” our proxy materials. A single proxy statement or notice may be delivered to multiple shareholders sharing an address unless contrary instructions have been received from the affected shareholders. Once you have received notice from your broker that it will be"householding"“householding” communications to your address,"householding"“householding” will continue until you are notified otherwise or until you notify your broker or the Company that you no longer wish to participate in"householding."“householding.”
If, at any time, you no longer wish to participate in"householding"“householding” and would prefer to receive a separate proxy statement, annual report or notice you may (1) notify your broker or (2) direct your written requestto: Secretary, Sirius International Insurance Group, Ltd., 14 Wesley Street, Hamilton HM 11, Bermuda.to the address listed below. Shareholders who currently receive multiple copies of our proxy statement and/or notice at their address and would like to request"householding"“householding” of their communications should contact their broker. In addition, the Company will promptly deliver, upon written or oral request to the address or telephone numberabove,below, a separate copy of the proxy statement, annual report and/or notice to a shareholder at a shared address to which a single copy of the document(s) was delivered.The Company can be reached at: Corporate Secretary, Sirius International Insurance Group, Ltd., 14 Wesley Street, Hamilton HM 11, Bermuda.
Pursuant to Rule 14a-8 under the Exchange Act, in order to be included in our proxy statement and form of proxy for the20202021 annual general meeting of shareholders, shareholder proposals must be received at our principal executive offices, 14 Wesley Street, 5th Floor, Hamilton HM11 Bermuda, Attention: Corporate Secretary, no later thanDecember 7, 2019,July 9, 2021, and must comply with additional requirements established by the SEC. If the date of the 2021 annual general meeting is scheduled more than 30 days from the anniversary date of the previous year’s meeting, then the Company will announce a new deadline for purposes of shareholder proposals submitted pursuant to Rule 14a-8. Pursuant to our bye-laws, a shareholder proposal of business submitted outside of the process established in Rule 14a-8 and shareholder nominations of directors must be received by the Corporate Secretary of the Company at the address indicated above at least 90 days prior to the anniversary date of the immediately preceding annual general meeting, or not later than 10 days after notice or public disclosure of the date of the annual general meeting is given or made available to shareholders, whichever date is earlier. For the20202021 annual general meeting of shareholders, unless the Company makes an earlier public disclosure with the date of such meeting, such proposal of business or shareholder nomination must be received byFebruary 23, 2020September 30, 2021 and otherwise comply with the requirements set forth in our bye-laws.A copy of our Annual Report on Form 10-K for the fiscal year ended December 31,2018,2019, as amended, which includes the financial statements, but excludes Form 10-K exhibits,is being mailed concurrently with this proxy statementwill be made available to all57shareholders entitled to notice of and to vote atourthe annual meeting.The Annual Report is also available free of charge to any shareholder upon written request to 14 Wesley Street, 5th Floor, Hamilton HM11 Bermuda, Attention: Corporate Secretary and is also available on our website at http://ir.siriusgroup.com/Docs.
TheCompany'sCompany’s headquarters is located at 14 Wesley Street, Hamilton HM11, Bermuda, its principal executive office is located at80 South Main14 Wesley Street,1st Floor, Hanover, New Hampshire 03755,Hamilton HM11, Bermuda, and its registered office is located at Clarendon House, 2 Church Street, Hamilton HM 11, Bermuda.We know of no other matters that will be presented for consideration atourthe annual meeting. If any other matters properly come beforeourthe annual meeting upon which a vote properly may be taken, shares represented by all proxies received by us on the proxy card will be voted with respect thereto as permitted and in accordance with the judgment of the proxy holders.BY ORDER OF THE BOARD OF DIRECTORS,![[MISSING IMAGE: sg_lisa-lr.jpg]](https://files.docoh.com/DEF 14A/0001104659-20-122496/sg_lisa-lr.jpg)
Lisa M. Tanzi
Corporate SecretaryDate: November 6, 2020BY ORDER OF THE BOARD OF DIRECTORS,Lisa M. Tanzi58SecretaryDate: April 5, 2019![[MISSING IMAGE: tm2035095d1-proxy_page1bw.jpg]](https://files.docoh.com/DEF 14A/0001104659-20-122496/tm2035095d1-proxy_page1bw.jpg)
VOTE BY INTERNET - www.proxyvote.com Use the Internet to transmit your voting instructions and for electronic delivery of information. Vote by 11:59 P.M. U.S. Eastern Time on May 22, 2019. Have your proxy card in hand when you access the web site and follow the instructions to obtain your records and to create an electronic voting instruction form. SIRIUS INTERNATIONAL INSURANCE GROUP, LTD. 14 WESLEY STREET, 5TH FLOOR HAMILTON HM 11, BERMUDA ELECTRONIC DELIVERY OF FUTURE PROXY MATERIALS If you would like to reduce the costs incurred by our company in mailing proxy materials, you can consent to receiving all future proxy statements, proxy cards and annual reports electronically via e-mail or the Internet. To sign up for electronic delivery, please follow the instructions above to vote using the Internet and, when prompted, indicate that you agree to receive or access proxy materials electronically in future years. VOTE BY PHONE - 1-800-690-6903 Use any touch-tone telephone to transmit your voting instructions. Vote by 11:59 P.M. U.S. Eastern Time on May 22, 2019. Have your proxy card in hand when you call and then follow the instructions. VOTE BY MAIL Mark, sign and date your proxy card and return it in the postage-paid envelope we have provided or return it to Vote Processing, c/o Broadridge, 51 Mercedes Way, Edgewood, NY 11717. TOSignature [PLEASE SIGN WITHIN BOX] Date Signature (Joint Owners) DateTO VOTE, MARK BLOCKS BELOW IN BLUE OR BLACK INK AS FOLLOWS:E65377-P20991KEEP THIS PORTION FOR YOURRECORDS DETACH AND RETURN THIS PORTION ONLY THISRECORDSTHIS PROXY CARD IS VALID ONLY WHEN SIGNED AND DATED.SIRIUSDETACH AND RETURN THIS PORTION ONLYD24418-Z785552. Approval, on a non-binding advisory basis of thecompensation of the Company's named executive officers3. To approve (i) the appointment of PricewaterhouseCoopersLLP (“PwC”) as the Company’s independent registeredcertified public accounting firm for the year endingDecember 31, 2020 and (ii) the ratification of thedetermination of PwC’s remuneration by the Audit &Risk Management Committee of the BoardNOTE: The transaction of such other business as may properlycome before the meeting, or any adjournment or postponementthereofFor Against Abstain For Against Abstain! ! !! ! !! ! !! ! !! ! !! ! !! ! ! ! ! !! ! !SIRIUS INTERNATIONAL INSURANCE GROUP,LTD.LTD.14 WESLEY STREET, 5TH FLOORHAMILTON HM 11, BERMUDANominees:1. Election of Director NomineesSIRIUS INTERNATIONAL INSURANCE GROUP, LTD.The Board of Directors recommends you vote FORthe following:The Board of Directors recommends you voteFOR the following: 1. Election of Director Nominees For Against Abstain Nominees: 1 YearFORproposals 2Years 3 Years Abstain ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! ! The Board of Directors recommends you vote "1 Year" on the following proposal:and 3:1a. Kernan (Kip) V.Oberting ! ! ! ! 1b. Laurence Liao 3. Approval, on a non-binding advisory basis, of the frequency of future shareholder advisory votes on the compensation of the Company's named executive officers 1c.Oberting1d. Alain M. Karaoglan1b. Robert L.Friedman For Against Abstain 1d.Friedman1c. Meyer (Sandy)Frucher The Board of Directors recommends you vote FOR proposal 4: ! ! ! 1e. Alain M. Karaoglan 4. To approve (i) the appointment of PricewaterhouseCoopers LLP ("PwC") as the Company's independent registered certified public accounting firm for the year ending December 31, 2019 and (ii) the ratification of the determination of PwC's remuneration by the Audit & Risk Management Committee of the Board 1f. Rachelle C. Keller 1g.Frucher1g. James (Jim) B. Rogers,Jr. NOTE: Such other business as may properly come before the meeting or any adjournment thereof. The Board of Directors recommends you vote FOR proposal 2: ! ! ! 2. Approval, on a non-binding advisory basis, of the compensation of the Company's named executive officers PleaseJr.1e. Rachelle C. Keller1f. Sabrina MaguirePlease sign exactly as your name(s) appear(s) hereon. When signing as attorney, executor,administrator, or other fiduciary, please give full title as such. Joint owners should eachsign personally.signpersonally. All holders must sign. If a corporation or partnership, please sign in fullcorporate orcorporateor partnership name by authorizedofficer. Signature [PLEASE SIGN WITHIN BOX] Date Signature (Joint Owners) Date
Important Notice Regardingofficer.VOTE BY INTERNETBefore The Meeting - Go to www.proxyvote.comUse theAvailability of Proxy MaterialsInternet to transmit your voting instructions and for electronic delivery ofinformation. Vote by 11:59 P.M. U.S. Eastern Time on December 28, 2020. Haveyour proxy card in hand when you access theAnnual Meeting:web site and follow the instructionsto obtain your records and to create an electronic voting instruction form.During TheAnnual ReportMeeting - Go to www.virtualshareholdermeeting.com/SG2020You may attend the meeting via the Internet andNoticevote during the meeting. Havethe information that is printed in the box marked by the arrow available andfollow the instructions.VOTE BY PHONE - 1-800-690-6903Use any touch-tone telephone to transmit your voting instructions. Vote by11:59 P.M. U.S. Eastern Time on December 28, 2020. Have your proxy card inhand when you call andProxy Statement are available at www.proxyvote.com. E65378-P20991 SIRIUSthen follow the instructions.VOTE BY MAILMark, sign and date your proxy card and return it in the postage-paidenvelope we have provided or return it to Vote Processing, c/o Broadridge,51 Mercedes Way, Edgewood, NY 11717.TOPPAN MERRILL • cs@toppanlf.com • 747 Third Avenue New York NY 10017 • 212.596.7747JOB: tm2035095-1_def14a • 14-proxycard • Proof — Proof Date: 11/05/20 @ 6:20 a.m.JOB: SiriusInsuranceGroup / tm2035095-1_def14a / 14-proxycard Page: 1 / 1D24419-Z78555SIRIUS INTERNATIONAL INSURANCE GROUP,LTD. AnnualLTD.Annual Meeting ofShareholders May 23, 2019ShareholdersDecember 29, 2020 8:30 AM BermudaTime ThisTimeThis proxy is solicited on behalf of the Board ofDirectors TheDirectorsThe shareholder(s) hereby appoint(s) Kernan V. Oberting andLisa M. Tanzi,Gene Boxer, or either of them, as proxies, each with the powerto appointtoappoint hisor hersubstitute, and herebyauthorizesauthorize(s) them to represent and to vote, as designated on the reverse side of this ballot, all ofthe CommontheCommon Shares and/or Series B preference shares of Sirius International Insurance Group, Ltd. that the shareholder(s) is/are entitledto votetovote at the Annual Meeting of Shareholders to be held virtually at 8:30a.m.AM Bermuda Time onMay 23, 2019 at the Hamilton Princess, 76 Pitts Bay Road, Pembroke, BermudaDecember 29, 2020 via live webcast atwww.virtualshareholdermeeting.com/SG2020 and any adjournment or postponementthereof. Thisthereof.This proxy, when properly executed, will be voted in the manner directed herein. If no such direction is made,this proxythisproxy will be voted in accordance with the Board of Directors'recommendations. Continuedrecommendations.Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting:The Annual Report and Notice and Proxy Statement are available at www.proxyvote.com.Continued and to be signed on reverse side
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D24419-Z78555SIRIUS INTERNATIONAL INSURANCE GROUP, LTD.Annual Meeting of ShareholdersDecember 29, 2020 8:30 AM Bermuda TimeThis proxy is solicited on behalf of the Board of DirectorsThe shareholder(s) hereby appoint(s) Kernan V. Oberting and Gene Boxer, or either of them, as proxies, each with the power toappoint his substitute, and hereby authorize(s) them to represent and to vote, as designated on the reverse side of this ballot, all of theCommon Shares and/or Series B preference shares of Sirius International Insurance Group, Ltd. that the shareholder(s) is/are entitled tovote at the Annual Meeting of Shareholders to be held virtually at 8:30 AM Bermuda Time on December 29, 2020 via live webcast atwww.virtualshareholdermeeting.com/SG2020 and any adjournment or postponement thereof.This proxy, when properly executed, will be voted in the manner directed herein. If no such direction is made, thisproxy will be voted in accordance with the Board of Directors' recommendations.Important Notice Regarding the Availability of Proxy Materials for the Annual Meeting:The Annual Report and Notice and Proxy Statement are available at www.proxyvote.com.Continued and to be signed on reverse side