Exhibit 10.81

FORM OF KEY EMPLOYEE EMPLOYMENT PROTECTION AGREEMENT

THIS AGREEMENT between MBIA Inc., a Connecticut corporation (the Company”), and
                                 (the “Participant”), dated as of this     th
day of                     ,             . Capitalized terms used but not
defined herein shall have the meaning set forth in the MBIA Inc., Key Employee
Employment Protection Plan.

WITNESSETH:

WHEREAS, the Company has employed the Participant and has determined that the
Participant holds an important position with the Company;

WHEREAS, the Company believes that, in the event it is confronted with a
situation that could result in a change in ownership or control of the Company,
continuity of management will be essential to its ability to evaluate and
respond to such a situation in the best interests of shareholders;

WHEREAS, the Company understands that any such situation will present
significant concerns for the Participant with respect to his financial and job
security;

WHEREAS, the Company desires to assure itself of the Participant’s services
during the period in which it is confronting such a situation, and to provide
the Participant certain financial assurances to enable the Participant to
perform the responsibilities of his position without undue distraction and to
exercise his judgment without bias due to his personal circumstances;

WHEREAS, as a condition to participation in the Plan, the Participant must enter
into a Key Employee Employment Protection Agreement with the Company;

NOW, THEREFORE, in consideration of the benefits provided by the Company in the
Plan, including severance payments, the grant and continued vesting of equity
awards and other benefits due Participant under Section 6 of the Plan:

1. Effective Date. The Effective Date of this Agreement shall be the date
specified on the signature page hereof.

2. Employment Period. Subject to Section 7 of the Plan, the Participant agrees
to remain in the employ of the Company through the Employment Period.

3. Duties. During the Employment Period, the Participant shall devote his full
attention during normal business hours to the business and affairs of the
Company and

 

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use his best efforts to perform faithfully and efficiently the responsibilities
assigned to him hereunder, to the extent necessary to discharge such
responsibilities, except for (i) time spent in managing his personal, financial
and legal affairs and serving on corporate, civic or charitable boards or
committees, in each case only if and to the extent not substantially interfering
with the performance of such responsibilities, and (ii) periods of vacation and
sick leave to which he is entitled. It is expressly understood and agreed that
the Participant’s continuing to serve on any boards and committees on which he
is serving or with which he is otherwise associated immediately preceding the
Effective Date shall not be deemed to interfere with the performance of the
Participant’s services to the Company.

4. Confidential Information, Company Property.

(a) Confidential Information. At all times after the Effective Date, the
Participant shall hold in a fiduciary capacity for the benefit of the Company
all secret or confidential information, knowledge or data relating to the
Company or any of its affiliated companies, and their respective businesses,
(i) obtained by the Participant during his employment by the Company or any of
its affiliated companies and (ii) not otherwise public knowledge (other than by
reason of an unauthorized act by the Participant). After termination of the
Participant’s employment with the Company, the Participant shall not, without
the prior written consent of the Company, unless compelled pursuant to an order
of a court or other body having jurisdiction over such matter, communicate or
divulge any such information, knowledge or data to anyone other than the Company
and those designated by it.

(b) Non-Competition. The Participant agrees that for two years after the Date of
Termination, Participant shall not, except with the prior written consent of the
Board, directly or indirectly, own any interest in, operate, join, control or
participate as a partner, director, principal, officer, or agent of, enter into
the employment of, act as a consultant to, or perform any services for any
entity which has operations that compete in any material respect with the
Company in any jurisdiction in which the Company or any of its subsidiaries is
engaged, or in which any of the foregoing has documented plans to become engaged
of which Participant has knowledge at the time of Participant’s termination of
employment (the “Business”). Notwithstanding anything herein to the contrary,
the foregoing shall not prevent Participant from acquiring as an investment
securities representing not more than two percent (2%) of the outstanding voting
securities of any publicly held corporation.

(c) Non-Disparagement. During the Employment Period and at any time thereafter,
Participant shall not, directly or indirectly, engage in any conduct or make any
statement, whether in commercial or noncommercial speech, disparaging or
criticizing in any way the Company or any of its affiliates any products or
services offered by any of these, nor shall he engage in any other conduct or
make any other statement that could be reasonably expected to impair the
goodwill of any of them, in each case except to the extent required by law, and
then only after consultation with the Company.

 

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(d) Nonsolicitation of Employees. The Participant agrees that for two years
after the Date of Termination, he will not attempt, directly or indirectly, to
induce any employee of the Company, or any subsidiary or any affiliate thereof
to be employed or perform services elsewhere or otherwise to cease providing
services to the Company, or any subsidiary or affiliate thereof.

(e) Nonsolicitation of Clients. During the Employment Period and for two years
after the Date of Termination, Participant shall not, directly or indirectly,
for his own account or for the account of any other Person, in any jurisdiction
in which the Company or any of its affiliates has commenced or made plans to
commence operations, solicit or otherwise attempt to establish any business
relationship of a nature that is competitive with the business or relationship
of the Company or any of its affiliates with any person throughout the world
which is or was a customer, client or distributor of the Company or any of its
affiliates at any time during which Participant was employed by the Company (in
the case of any such activity during such time) or during the twelve-month
period preceding the Date of Termination (in the case of any such activity after
the Date of Termination), other than any such solicitation on behalf of the
Company or any of its affiliates during the Employment Period.

(f) Company Property. Except as expressly provided herein, promptly following
the Participant’s termination of employment, the Participant shall return to the
Company all property of the Company and all copies thereof in the Participant’s
possession or under his control.

5. Injunctive Relief and Other Remedies with Respect to Covenants.

(a) The Participant acknowledges and agrees that the covenants and obligations
of the Participant with respect to confidentiality and Company property relate
to special, unique and extraordinary matters and that a violation of any of the
terms of such covenants and obligations will cause the Company irreparable
injury for which adequate remedies are not available at law. Therefore, the
Participant agrees that the Company shall be entitled to an injunction,
restraining order or such other equitable relief (without the requirement to
post bond) restraining Participant from committing any violation of the
covenants and obligations contained in this Agreement. These remedies are
cumulative and are in addition to any other rights and remedies the Company may
have at law or in equity. In no event shall an asserted violation of the
provisions of this Agreement constitute a basis for deferring or withholding any
amounts otherwise payable to the Participant under the Plan.

(b) The Participant agrees that in the event the Participant breaches any
provision of Section 4 hereof in any material respect following the Date of
Termination, in addition

 

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to any remedy at law or in equity, the Participant shall (i) not be entitled to
receive, if not already paid, the benefits described in Section 8 of the Plan,
and (ii) return to the Company any and all payments previously made by the
Company (or any of its affiliates) pursuant to Section 8 of the Plan within 15
days after written demand for such repayment is made to Participant by the
Company.

6. Miscellaneous.

(a) Applicable Law. Except to the extent that they may be preempted by Federal
law, this Agreement shall be governed by and construed in accordance with the
laws of the State of New York, applied without reference to principles of
conflict of laws.

(b) Gender and Number. Except when otherwise indicated by the context, words in
the masculine gender used in this Agreement shall include the feminine gender,
the singular shall include the plural, and the plural shall include the
singular.

(c) Arbitration. Except as otherwise provided in Section 5 hereof, any dispute
or controversy arising under or in connection with this Agreement shall be
resolved by binding arbitration. The arbitration shall be held in the city of
White Plains, New York and, except to the extent inconsistent with this
Agreement, shall be conducted in accordance with the Expedited Employment
Arbitration Rules of the American Arbitration Association then in effect at the
time of the arbitration (or such other rules as the parties may agree to in
writing), and otherwise in accordance with principles which would be applied by
a court of law or equity. The arbitrator shall be acceptable to both the Company
and the Participant. If the parties cannot agree on an acceptable arbitrator,
the dispute shall be heard by a panel of three arbitrators, one appointed by
each of the parties and the third appointed by the other two arbitrators.

(d) Severability; Reformation. In the event that one more of the provisions of
this Agreement shall become invalid, illegal or unenforceable in any respect,
the validity, legality, and enforceability of the remaining provisions contained
herein shall not be affected thereby. In the event that any of the provisions of
Section 4 hereof is not enforceable in accordance with its terms, the
Participant and the Company agree that such Section shall be reformed to make
such Section enforceable in a manner which provides the Company the maximum
rights permitted at law.

(e) Entire Agreement. The Plan and this Agreement constitute the entire
agreement among the parties hereto with respect to the subject matter hereof,
and supersede all undertakings and agreements, whether oral or in writing,
previously entered into by the parties with respect thereto.

(f) Waiver. Waiver by any party hereto of any breach or default by the other
party of any of the terms of this Agreement shall not operate as a waiver of any
other breach or default, whether similar to or different from the breach or
default waived. No

 

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waiver of any provision of this Agreement shall be implied from any course of
dealing between the parties hereto or from any failure by either party hereto to
assert its or his rights hereunder on any occasion or series of occasions.

(g) Captions. The captions of this Agreement are not part of the provisions
hereof and shall have no force or effect.

IN WITNESS WHEREOF, the Company and the Participant have executed this Agreement
as of the date first above written.

 

MBIA INC.

 

By: PARTICIPANT

 

 

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