Exhibit 10.9.8

 

ARCH CAPITAL GROUP LTD.
Restricted Share Agreement

 

THIS AGREEMENT, dated as of                     , between Arch Capital Group
Ltd. (the “Company”), a Bermuda company, and                       (the
“Employee”).

 

WHEREAS, the Employee has been granted the following award under the Company’s
2007 Long Term Incentive and Share Award Plan (the “Plan”);

 

NOW, THEREFORE, in consideration of the premises and mutual covenants contained
herein, the parties hereto agree as follows.

 

1.                                       AWARD OF SHARES.  PURSUANT TO THE
PROVISIONS OF THE PLAN, THE TERMS OF WHICH ARE INCORPORATED HEREIN BY REFERENCE,
THE EMPLOYEE IS HEREBY AWARDED               RESTRICTED SHARES (THE “AWARD”),
SUBJECT TO THE TERMS AND CONDITIONS HEREIN SET FORTH.  CAPITALIZED TERMS USED
HEREIN AND NOT DEFINED SHALL HAVE THE MEANINGS SET FORTH IN THE PLAN.  IN THE
EVENT OF ANY CONFLICT BETWEEN THIS AGREEMENT AND THE PLAN, THE PLAN SHALL
CONTROL.

 

2.                                       TERMS AND CONDITIONS.  IT IS UNDERSTOOD
AND AGREED THAT THE AWARD OF RESTRICTED SHARES EVIDENCED HEREBY IS SUBJECT TO
THE FOLLOWING TERMS AND CONDITIONS:

 

(A)                                  VESTING OF AWARD.  SUBJECT TO
SECTION 2(B) BELOW AND THE OTHER TERMS AND CONDITIONS OF THIS AGREEMENT, THIS
AWARD SHALL BECOME VESTED IN THREE EQUAL ANNUAL INSTALLMENTS ON THE FIRST,
SECOND AND THIRD ANNIVERSARIES OF THE DATE HEREOF.  UNLESS OTHERWISE PROVIDED BY
THE COMPANY, ALL DIVIDENDS AND OTHER AMOUNTS RECEIVABLE IN CONNECTION WITH ANY
ADJUSTMENTS TO THE SHARES UNDER SECTION 4(C) OF THE PLAN SHALL BE SUBJECT TO THE
VESTING SCHEDULE IN THIS SECTION 2(A).

 

(B)                                 TERMINATION OF SERVICE; FORFEITURE OF
UNVESTED SHARES.

 

(I)                                     IN THE EVENT THE EMPLOYEE CEASES TO BE
AN EMPLOYEE OF THE COMPANY PRIOR TO THE DATE THE RESTRICTED SHARES OTHERWISE
BECOME VESTED DUE TO HIS OR HER DEATH OR PERMANENT DISABILITY (AS DEFINED IN THE
COMPANY’S INCENTIVE COMPENSATION PLAN ON THE DATE HEREOF), THE RESTRICTED SHARES
SHALL BECOME IMMEDIATELY VESTED IN FULL UPON SUCH TERMINATION OF EMPLOYMENT.

 

(II)                                  IN THE EVENT OF TERMINATION OF EMPLOYMENT
(OTHER THAN BY THE COMPANY FOR CAUSE, AS SUCH TERM IS DEFINED IN THE COMPANY’S
INCENTIVE COMPENSATION PLAN ON THE DATE HEREOF) AFTER THE ATTAINMENT OF
RETIREMENT AGE (AS DEFINED IN THE COMPANY’S INCENTIVE COMPENSATION PLAN ON THE
DATE HEREOF), THE RESTRICTED SHARES SHALL CONTINUE TO VEST ON THE SCHEDULE SET
FORTH IN SECTION 2(A) ABOVE SO LONG AS THE EMPLOYEE DOES NOT ENGAGE IN ANY
ACTIVITY IN COMPETITION WITH ANY ACTIVITY OF THE COMPANY OR ANY OF ITS
SUBSIDIARIES OTHER THAN SERVING ON THE BOARD OF DIRECTORS (OR SIMILAR GOVERNING
BODY) OF ANOTHER COMPANY OR AS A CONSULTANT FOR NO MORE THAN 26 WEEKS PER
CALENDAR YEAR (“COMPETITIVE ACTIVITY”).

 

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IN THE EVENT THE EMPLOYEE ENGAGES IN A COMPETITIVE ACTIVITY, ANY UNVESTED
RESTRICTED SHARES SHALL BE FORFEITED BY THE EMPLOYEE AND BECOME THE PROPERTY OF
THE COMPANY.

 

(III)                               IN THE EVENT THE EMPLOYEE CEASES TO BE AN
EMPLOYEE OF THE COMPANY AFTER A CHANGE IN CONTROL (AS DEFINED BELOW) DUE TO
TERMINATION BY THE COMPANY NOT FOR CAUSE ON OR BEFORE THE SECOND ANNIVERSARY OF
THE OCCURRENCE OF THE CHANGE IN CONTROL, THE RESTRICTED SHARES, TO THE EXTENT
NOT ALREADY VESTED, SHALL BECOME IMMEDIATELY VESTED IN FULL UPON SUCH
TERMINATION OF EMPLOYMENT.

 

(IV)                              IF THE EMPLOYEE CEASES TO BE AN EMPLOYEE OF
THE COMPANY FOR ANY OTHER REASON PRIOR TO THE DATE THE RESTRICTED SHARES BECOME
VESTED, THE AWARD SHALL BE FORFEITED BY THE EMPLOYEE AND BECOME THE PROPERTY OF
THE COMPANY; PROVIDED THAT, IN THE EVENT OF A REDUNDANCY (AS DEFINED BELOW), THE
COMMITTEE, IN ITS SOLE DISCRETION, MAY, IN ACCORDANCE WITH ITS AUTHORITY UNDER
THE PLAN, DETERMINE THAT THE RESTRICTED SHARES, TO THE EXTENT NOT VESTED, SHALL
BECOME VESTED UPON SUCH TERMINATION OF EMPLOYMENT.

 

(V)                                 FOR PURPOSES OF THIS AGREEMENT, SERVICE WITH
ANY OF THE COMPANY’S SUBSIDIARIES (AS DEFINED IN THE PLAN) SHALL BE CONSIDERED
TO BE SERVICE WITH THE COMPANY.

 

(VI)                              “CHANGE IN CONTROL” SHALL MEAN:

 

(A)                              any person (within the meaning of the
Securities Exchange Act of 1934, as amended (the “Exchange Act”), other than a
Permitted Person, is or becomes the “beneficial owner” (as defined in Rule 13d-3
under the Exchange Act), directly or indirectly, of Voting Securities
representing 50% or more of the total voting power or value of all the then
outstanding Voting Securities; or

 

(B)                                the individuals who, as of the date hereof,
constitute the Board of Directors of the Company (the “Board”) together with
those who become directors subsequent to such date and whose recommendation,
election or nomination for election to the Board was approved by a vote of at
least a majority of the directors then still in office who either were directors
as of such date or whose recommendation, election or nomination for election was
previously so approved, cease for any reason to constitute a majority of the
members of the Board; or

 

(C)                                the consummation of a merger, consolidation,
recapitalization, liquidation, sale or disposition by the

 

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Company of all or substantially all of the Company’s assets, or reorganization
of the Company, other than any such transaction which would (x) result in more
than 50% of the total voting power and value represented by the voting
securities of the surviving entity outstanding immediately after such
transaction being beneficially owned by the former shareholders of the Company
and (y) not otherwise be deemed a Change in Control under subparagraphs (A) or
(B) of this paragraph.

 

“Permitted Persons” means (A) the Company; (B) any Related Party; (C) Hellman &
Friedman or any of its subsidiaries or investment funds managed or controlled by
Hellman & Friedman; (D) Warburg Pincus or any of its subsidiaries or any
investment funds managed or controlled by Warburg Pincus or any of its
subsidiaries; or (E) any group (as defined in Rule 13b-3 under the Exchange Act)
comprised of any or all of the foregoing.

 

“Related Party” means (A) a majority-owned subsidiary of the Company; (B) a
trustee or other fiduciary holding securities under an employee benefit plan of
the Company or any majority-owned subsidiary of the Company; or (C) any entity,
50% or more of the voting power of which is owned directly or indirectly by the
shareholders of the Company in substantially the same proportion as their
ownership of Voting Securities immediately prior to the transaction.

 

“Voting Security” means any security of the Company which carries the right to
vote generally in the election of directors.

 

(VII)                           “REDUNDANCY” SHALL MEAN TERMINATION OF
EMPLOYMENT BY THE COMPANY DUE TO ITS NEED TO REDUCE THE SIZE OF ITS WORKFORCE,
INCLUDING DUE TO CLOSURE OF A BUSINESS OR A PARTICULAR WORKPLACE OR CHANGE IN
BUSINESS PROCESS.  WHETHER A TERMINATION OF EMPLOYMENT IS DUE TO A “REDUNDANCY”
SHALL BE DETERMINED BY THE COMMITTEE IN ITS SOLE AND ABSOLUTE DISCRETION, SUCH
DETERMINATION BEING FINAL AND BINDING ON ALL PARTIES HERETO AND ALL PERSONS
CLAIMING THROUGH, IN THE NAME OF OR ON BEHALF OF SUCH PARTIES.

 

(C)                                  CERTIFICATES.  EACH CERTIFICATE ISSUED IN
RESPECT OF RESTRICTED SHARES AWARDED HEREUNDER SHALL BE DEPOSITED WITH THE
COMPANY, OR ITS DESIGNEE, TOGETHER WITH, IF

 

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REQUESTED BY THE COMPANY, A STOCK POWER EXECUTED IN BLANK BY THE EMPLOYEE, AND
SHALL BEAR A LEGEND DISCLOSING THE RESTRICTIONS ON TRANSFERABILITY IMPOSED ON
SUCH RESTRICTED SHARES BY THIS AGREEMENT (THE “RESTRICTIVE LEGEND”).  UPON THE
VESTING OF RESTRICTED SHARES PURSUANT TO SECTION 2 HEREOF AND THE SATISFACTION
OF ANY WITHHOLDING TAX LIABILITY PURSUANT TO SECTION 5 HEREOF, SUCH VESTED
SHARES, NOT BEARING THE RESTRICTIVE LEGEND, SHALL BE DELIVERED TO THE EMPLOYEE.

 

(d)                                 Rights of a Stockholder.  Prior to the time
a Restricted Share is fully vested hereunder, the Employee shall have no right
to transfer, pledge, hypothecate or otherwise encumber such Restricted Share. 
During such period, the Employee shall have all other rights of a stockholder,
including, but not limited to, the right to vote and to receive dividends
(subject to Section 2(a) hereof) at the time paid on such Restricted Shares.

 

(e)                                  No Right to Continued Employment.  This
Award shall not confer upon the Employee any right with respect to continuance
of employment by the Company nor shall this Award interfere with the right of
the Company to terminate the Employee’s employment at any time.

 

3.                                       TRANSFER OF SHARES.  THE SHARES
DELIVERED HEREUNDER, OR ANY INTEREST THEREIN, MAY BE SOLD, ASSIGNED, PLEDGED,
HYPOTHECATED, ENCUMBERED, OR TRANSFERRED OR DISPOSED OF IN ANY OTHER MANNER, IN
WHOLE OR IN PART, ONLY IN COMPLIANCE WITH THE TERMS, CONDITIONS AND RESTRICTIONS
AS SET FORTH IN THE GOVERNING INSTRUMENTS OF THE COMPANY, APPLICABLE UNITED
STATES FEDERAL AND STATE SECURITIES LAWS OR ANY OTHER APPLICABLE LAWS OR
REGULATIONS AND THE TERMS AND CONDITIONS HEREOF.

 

4.                                       EXPENSES OF ISSUANCE OF SHARES.  THE
ISSUANCE OF STOCK CERTIFICATES HEREUNDER SHALL BE WITHOUT CHARGE TO THE
EMPLOYEE.  THE COMPANY SHALL PAY ANY ISSUANCE, STAMP OR DOCUMENTARY TAXES (OTHER
THAN TRANSFER TAXES) OR CHARGES IMPOSED BY ANY GOVERNMENTAL BODY, AGENCY OR
OFFICIAL (OTHER THAN INCOME TAXES) OR BY REASON OF THE ISSUANCE OF SHARES.

 

5.                                       WITHHOLDING.  NO LATER THAN THE DATE OF
VESTING OF (OR THE DATE OF AN ELECTION BY THE EMPLOYEE UNDER SECTION 83(B) OF
THE CODE WITH RESPECT TO) THE AWARD GRANTED HEREUNDER, THE EMPLOYEE SHALL PAY TO
THE COMPANY OR MAKE ARRANGEMENTS SATISFACTORY TO THE COMMITTEE REGARDING PAYMENT
OF ANY FEDERAL, STATE OR LOCAL TAXES OF ANY KIND REQUIRED BY LAW TO BE WITHHELD
AT SUCH TIME WITH RESPECT TO SUCH AWARD AND THE COMPANY SHALL, TO THE EXTENT
PERMITTED OR REQUIRED BY LAW, HAVE THE RIGHT TO DEDUCT FROM ANY PAYMENT OF ANY
KIND OTHERWISE DUE TO THE EMPLOYEE, FEDERAL, STATE AND LOCAL TAXES OF ANY KIND
REQUIRED BY LAW TO BE WITHHELD AT SUCH TIME.

 

6.                                       REFERENCES.  REFERENCES HEREIN TO
RIGHTS AND OBLIGATIONS OF THE EMPLOYEE SHALL APPLY, WHERE APPROPRIATE, TO THE
EMPLOYEE’S LEGAL REPRESENTATIVE OR ESTATE WITHOUT REGARD TO WHETHER SPECIFIC
REFERENCE TO SUCH LEGAL REPRESENTATIVE OR ESTATE IS CONTAINED IN A PARTICULAR
PROVISION OF THIS AGREEMENT.

 

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7.                                       NOTICES.  ANY NOTICE REQUIRED OR
PERMITTED TO BE GIVEN UNDER THIS AGREEMENT SHALL BE IN WRITING AND SHALL BE
DEEMED TO HAVE BEEN GIVEN WHEN DELIVERED PERSONALLY OR BY COURIER, OR SENT BY
CERTIFIED OR REGISTERED MAIL, POSTAGE PREPAID, RETURN RECEIPT REQUESTED, DULY
ADDRESSED TO THE PARTY CONCERNED AT THE ADDRESS INDICATED BELOW OR TO SUCH
CHANGED ADDRESS AS SUCH PARTY MAY SUBSEQUENTLY BY SIMILAR PROCESS GIVE NOTICE
OF:

 

If to the Company:

 

Arch Capital Group Ltd.
Wessex House, 4th Floor
45 Reid Street
Hamilton HM 12 Bermuda
Attn.: Secretary

 

If to the Employee:

 

To the last address delivered to the Company by the
Employee in the manner set forth herein.

 

8.                                       GOVERNING LAW.  THIS AGREEMENT SHALL BE
GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF NEW YORK, WITHOUT
GIVING EFFECT TO PRINCIPLES OF CONFLICT OF LAWS.

 

9.                                       ENTIRE AGREEMENT.  THIS AGREEMENT AND
THE PLAN CONSTITUTE THE ENTIRE AGREEMENT AMONG THE PARTIES RELATING TO THE
SUBJECT MATTER HEREOF, AND ANY PREVIOUS AGREEMENT OR UNDERSTANDING AMONG THE
PARTIES WITH RESPECT THERETO IS SUPERSEDED BY THIS AGREEMENT AND THE PLAN.

 

10.                                 COUNTERPARTS.  THIS AGREEMENT MAY BE
EXECUTED IN TWO COUNTERPARTS, EACH OF WHICH SHALL CONSTITUTE ONE AND THE SAME
INSTRUMENT.

 

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

 

 

ARCH CAPITAL GROUP LTD.

 

 

 

 

 

By:

 

 

 

Name:

 

 

Title:

 

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