Exhibit 10.3]
ADVISORY AGREEMENT
THIS ADVISORY AGREEMENT (the "Agreement") is made as of the 7th day of December, 2005, between Validus Holdings, Ltd. (including its successors and assigns, the "Company"), a company with limited liability organized under the laws of Bermuda, and Aquiline Capital Partners LLC (the "Advisor"), a
Delaware limited liability company.
The parties hereto hereby agree as follows:
1. Services Rendered by the Advisor to the Company. The Advisor has and shall continue to, by and through itself and its officers, employees and representatives as it shall designate in its sole discretion from time to time, provide advisory and consulting services in relation to the affairs of the Company and its subsidiaries with respect to:
(a) the formation and initial capitalization of the Company and its
subsidiaries;
(b) subject to the authority of the Company's board of directors (the
"Board"), the structure and timing of public and private offerings of debt
and equity securities of the Company and its subsidiaries and other
financings;
(c) subject to the authority of the Board, property dispositions or
acquisitions; and
(d) such other advice directly related or ancillary to the advisory
services, in the case of (a)-(c) above, as may be mutually agreeable to
each of them and the Board.
The Advisor shall at all times be an independent contractor and nothing in this Agreement shall be construed to constitute the Advisor as an agent or a partner of the Company.
2. Fees. In consideration for services rendered to date, as well as services to be rendered, the Company agrees to pay an advisory fee (the "Advisory Fee") to the Advisor (or its designee) in an amount equal to $1,000,000 per annum, such fee being being due in full on the date that is thirty days following the first funding of the Company's offering of common shares and each anniversary of the date hereof.
3. Term. This Agreement shall become effective upon its execution, and shall automatically terminate on the day before the fifth anniversary of the date hereof (the "Termination Date"); provided, that the Company may terminate this Agreement at any time after the date hereof upon payment in full to the Advisor of the remaining Advisory Fees that would otherwise be paid by the Company if the Agreement were terminated on the Termination Date. Notwithstanding the foregoing, the provisions of Paragraph 6 shall survive the termination date.
4. Change of Control; First Public Offering. Prior to the Termination Date, upon the earlier to occur of (a) a Change of Control (as defined in the Bye-laws of the Company (the "Bye-laws") and (b) the First Public Offering (as defined in the Bye-laws), the Company shall immediately pay in full to the Advisor the remaining Advisory Fees that would otherwise be paid by the Company if the Agreement were terminated on the Termination ...