Compensation Committee Charter

Purpose of Committee

The purpose of the Compensation Committee (the "Committee") of the Board of Directors (the "Board") of Majestic Capital, Ltd. the "Company") is (i) to perform the functions described below under "Committee Duties and Responsibilities" in order to aid the Board in meeting its responsibilities relating to compensation of the Company's executive officers, and (ii) to review and discuss with the Company's management the Compensation Discussion and Analysis (CD&A) to be included in the Company's annual proxy statement and determine whether to recommend to the Board of Directors that the CD&A be included in the proxy statement and (iii) to provide the Compensation Committee Report for inclusion in the Company's proxy statement, in accordance with applicable rules and regulations.

In pursuing its purpose the Committee shall assist the Board to ensure that a proper system of compensation is in place for management, and that compensation plans are appropriate and competitive and properly reflect the objectives and performance of management and the Company. Any action duly and validly taken by the Compensation Committee pursuant to the power and authority conferred under this Charter shall for all purposes constitute an action duly and validly taken by the Board and may be certified as such by the Secretary or other authorized officer of the Company.

Committee Duties and Responsibilities

The Committee's duties and responsibilities are to:

• Annually review and approve corporate and individual goals and objectives relevant to the compensation of the Chief Executive Officer and other executive officers. After an annual evaluation of performance by the Committee in light of those goals and objectives, the Committee, together with the other directors who meet the Independence Requirements (as defined below) if directed by the Board, shall determine the base salary and bonus of the Chief Executive Officer (who may not be present during voting or deliberations) and other executive officers, subject to the terms of any applicable employment agreements;
• Review and approve any contractual employment or compensation arrangements, and amendments thereto, with the Company's "executive officers" (as such term is defined under Rule 16a-1 promulgated under the Securities Exchange Act of 1934 and is generally meant to include individuals who perform a policy-making function on behalf of the Company);
• Administer the Company's management incentive plan, stock option plan or other similar plan and approve all grants made pursuant to such plan;
• Make recommendations to the Board regarding compensation for Directors;
• Review, and make periodic recommendations to the Board with respect to, the Company's equity-based compensation plans. In circumstances in which equity-based compensation plans are not subject to shareholder approval, such plans shall be subject to the Committee's approval or recommendation to the Board for approval by a majority of the Independent Directors;
• Review and discuss with management the Company's disclosures under the CD&A, and based on such review and discussion, make a recommendation to the Board as to whether the CD&A should be included in the Company's annual report on Form 10-K and, as applicable, the Company's proxy statement;
• Produce an annual Compensation Committee Report for inclusion in the Company's proxy statement; and
• Perform such other duties as the Board may assign to the Committee with respect to the Company's compensation policies.

Committee Membership

The Committee shall consist of no fewer than two members of the Board. A person may serve on the Committee only if the Board determines that he or she:

• Is a "Non-employee Director" for purposes of Rule 16b-3 under the U.S. Securities Exchange Act of 1934, as amended;
• Satisfies the requirements of an "outside director" for purposes of Section 162(m) of the Internal Revenue Code of 1986, as amended; and
• Is an "independent director" under the rules of The Nasdaq Stock Market, Inc.

The members of the Committee shall be appointed by the Board, and shall serve at the pleasure of the Board for such term or terms as the Board may determine.

Committee Structure and Operations

A majority of the Committee shall constitute a quorum. The Board shall designate a member of the Committee as its chairperson. The Committee may act by a majority of the members present at a meeting of the Committee. In the event of a tie vote on any issue, the chairperson's vote shall decide the issue. The Committee shall meet in person or telephonically at least two times a year, at a time and place determined by the Committee chairperson, with further meetings to occur when deemed necessary or desirable by the Committee or its chairperson. The Committee may delegate some or all of its duties to a subcommittee comprising one or more members of the Committee. The Committee may ask members of management or others whose advice and counsel are relevant to the issues then being considered by the Committee to attend any meetings and to provide such pertinent information as the Committee may request. The Committee shall report to the Board at least once a year.

Performance Evaluation

The Committee shall annually compare its performance with the requirements of this Charter, set forth its objectives for the next year and recommend changes in this Charter, if any, considered appropriate by the Committee. Such evaluation shall be reported to the Board in such manner as the Committee from time to time determines.

Surveys and Studies

The Committee may conduct or authorize surveys or studies of matters within the Committee's scope of responsibilities as described above, including, but not limited to, surveys or studies of compensation practices in relevant industries, to maintain the Company's competitiveness and ability to recruit and retain highly qualified personnel, and may retain and terminate, at the expense of the Company, independent counsel or other consultants necessary to assist in any such survey or study. If any compensation consultant or firm is to assist in the evaluation of director, chief executive officer or senior executive compensation, the Committee shall have the sole authority to retain and terminate the compensation consultant or firm and approve such firm or person's fees and other retention terms.

Nothing contained in this Charter is intended to, or should be construed as, creating any responsibility or liability of the members of the Committee except to the extent otherwise provided under applicable law.

Revised and Adopted: May 1, 2007

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Committee Members

Salvatore A. Patafio
Charles Johnston
Philip J. Magnarella