WASHINGTON (Dow Jones) ? Ace Ltd. said has entered into a consulting agreement with GTS Consulting LLC, which is led by Gary Schmalzriedt, the former chief executive of one of Ace Ltd.?s units.

The insurance and reinsurance unit said in a filing with the Securities and Exchange Commission that Schmalzriedt, who was CEO of Ace American Insurance Co., will receive $100,000, payable quarterly, plus reasonable out-of-pocket expenses, for his consulting services.

The company said the consulting agreement started October 1 and extends through September 30, 2007. Mr. Schmalzriedt will provide consulting services relating to duties he was responsible for under his former position, according to the filing.

Also, Mr. Schmalzriedt?s unvested stock options granted on the date of his retirement, September 30, will continue to vest in one-third increments on September 29 of 2007, 2008, and 2009, the company said.

Mr. Schmalzriedt was awarded options to purchase 11,430 ACE shares on September 29 at an exercise price of $54.73 a share.

Shares of Ace recently traded at $56.05.