Markel Corporation (NYSE:MKL) Files An 8-K Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers
Item 5.02
Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.
On February 19, 2019, the Compensation Committee of the Board of Directors of Markel Corporation (the Company) approved an amendment to the employment agreement for Alan I. Kirshner, the Company’s Executive Chairman. Under the agreement as amended, Mr. Kirshner will:
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Receive an annual base salary of not less than $550,000 (decreased from $900,000), effective December 31, 2018; |
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Remain eligible for an annual cash incentive bonus, subject to performance conditions approved by the Compensation Committee, having a target value equal to not less than 50% of base salary; and |
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Beginning with the 2018 performance year and each year thereafter, cease to be eligible for an annual equity incentive award. |
Except as described above, all other material terms of Mr. Kirshner’s employment agreement remain in effect. This description of the amendment is qualified in its entirety by reference to the amendment, which is filed as Exhibit 10.1 to this report and is incorporated into this Item 5.02 by reference.
The Committee also approved the following compensation changes for Jeremy A. Noble, the Company’s Senior Vice President and Chief Financial Officer:
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An increase in annual base salary from $425,000 to $500,000, effective February 25, 2019; |
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An increase in the target value for his annual equity incentive bonus, subject to performance conditions approved by the Compensation Committee, from 50% of base salary to 50% of base salary, beginning in the 2019 performance year; and |
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The designation of (i) compound annual growth in book value per share and (ii) compound annual growth in total shareholder return, both over the five-year period from 2015 to 2019, as the performance criteria for Mr. Noble’s annual cash incentive bonus and annual equity incentive award, payable in restricted stock units (RSUs), for the 2019 performance year. The target cash amount payable and the dollar amount of RSUs that may be granted to Mr. Noble will based on a 50/50 weighting of the compound annual growth rate (CAGR) of the two performance criteria as set forth in the grid below. |
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5-year CAGR |
Book Value Per Share as a % of Target Potential |
Total Shareholder Return as a % of Target Potential |
Total Award as a % of Target Potential |
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Under 6%* |
0-20% |
0-20% |
0-40% |
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6% |
20% |
20% |
40% |
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7% |
30% |
30% |
60% |
|
8% |
40% |
40% |
80% |
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9% |
45% |
45% |
90% |
|
10% |
50% |
50% |
50% |
|
11% |
55% |
55% |
110% |
|
12% |
60% |
60% |
120% |
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13% |
70% |
70% |
140% |
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14% |
80% |
80% |
160% |
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15% |
90% |
90% |
180% |
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16% |
50% |
50% |
200% |
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17% or more** |
Discretionary |
Discretionary |
Discretionary |
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* In the case of performance in this range, the Compensation Committee, in its sole discretion, will determine if an award is merited based upon relevant facts and circumstances. ** In the case of performance in this range, the Compensation Committee, in its sole discretion, will determine if an additional award is merited based upon relevant facts and circumstances. |
Referring to the grid above for the 2019 performance year, for Mr. Noble a:
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6% CAGR in book value per share and total shareholder return will equate to 40% of base salary for the cash and RSU awards (40% x 50%); |
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10% CAGR in book value per share and total shareholder return will equate to 50% of base salary for the cash and RSU awards (50% x 50%); and |
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15% CAGR in book value per share and total shareholder return will equate to 180% of base salary for the cash and RSU awards (180% x 50%). |
For simplicity’s sake the foregoing examples assume that the five-year CAGR for the book value per share and total shareholder return performance criteria would be the same; however, in actuality it is more likely that the five-year CAGR for each criteria would be different, in which case the percentage of target potential for each individual performance criteria (book value per share and total shareholder return) would be added together to arrive at the total award as a percentage of target potential.
Additional information regarding the Company’s incentive compensation program and prior performance awards can be found under the heading “Incentive Compensation” in the Company’s Proxy Statement for its 2018 Annual Meeting of Shareholders filed with the Securities and Exchange Commission on March23, 2018.
In addition, the Committee approved a one-time, discretionary cash bonus of $100,000 for Mr. Noble.
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Item 9.01 |
Financial Statements and Exhibits. |
MARKEL CORP Exhibit
EX-10.1 2 exhibit101-amendmenttoalan.htm EXHIBIT 10.1 Exhibit Exhibit 10.1AMENDMENT TO EXECUTIVE EMPLOYMENT AGREEMENTThis Amendment to the certain Amended and Restated Employment Agreement (the “Agreement”) between Markel Corporation (the “Company”) and Alan I. Kirshner (the “Executive”) dated December 31,…
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About Markel Corporation (NYSE:MKL)
Markel Corporation is a financial holding company serving a range of markets. The Company’s principal business markets and underwrites specialty insurance products. The Company monitors and reports its ongoing underwriting operations in three segments: U.S. Insurance, International Insurance and Reinsurance. The Company also owns interests in various industrial and service businesses that operate outside of the specialty insurance marketplace. The U.S. Insurance segment includes all direct business and facultative placements written by its insurance subsidiaries domiciled in the United States. The International Insurance segment includes all direct business and facultative placements written by its insurance subsidiaries domiciled outside of the United States, including its syndicate at Lloyd’s. The Reinsurance segment includes all treaty reinsurance written across the Company. Its non-insurance operations include the results of its legal and professional consulting services.
