Exhibit 10.16
EMPLOYMENT AGREEMENT

EMPLOYMENT AGREEMENT (“Agreement”), dated as of March 1, 2019, between Arch U.S.
MI Services Inc., a Delaware corporation (the “Company”), and David Gansberg
(the “Executive”).

WHEREAS, the Executive has been promoted to the positions described in Section
3.01 below;

WHEREAS, in connection with the promotion and in exchange for and contingent on
the Executive’s execution of this Agreement, the Executive’s base salary will be
increased to the amount set forth in Section 4.01 below, he will receive the
equity grant from the Company described in Section 4.06 below and he will be
entitled to the severance benefits on the terms set forth in Article 5 below;

WHEREAS, the Executive’s positions with the Company and its Affiliates will give
him access to Confidential Information (as defined herein) of the Company and
its Affiliates (as defined herein);

WHEREAS, the Executive’s positions with the Company and its Affiliates will give
the Executive certain opportunities , on behalf of the Company, to work with and
develop relationships with employees, customers, investors, clients, insured,
reinsureds, brokers, agents, and licensees of the Company and its Affiliates;
and

WHEREAS, the parties agree that this Agreement is necessary for the protection
and preservation of the proprietary and confidential information of the Company
and its Affiliates, the protection and preservation of the goodwill of the
Company and its Affiliates, and the protection and preservation of the
relationships that the Company has with its employees, customers, investors,
clients, insureds, reinsureds, brokers, agents, licensees, and others with which
the Company has a business relationship; and

NOW, THEREFORE, in consideration of the Executive’s continued employment as
provided herein, the Executive’s increased base salary, his receipt of an equity
grant from the Company, his severance benefits payable as set forth herein and
other good and valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, the parties hereto agree as follows:

ARTICLE 1

DEFINITIONS

SECTION 1.01. Definitions. For purposes of this Agreement, the following terms
have the meanings set forth below:

“Accounting Firm” has the meaning set forth in Section 12.10(b).

“Affiliate” means any Person, directly or indirectly, through one or more
intermediaries,
Controlling, Controlled by, or under common Control with the Company. For
purposes hereof, (a) “Control” means the ownership, directly or indirectly, of
(i) in the case of a corporation, Voting Securities (as defined below)
representing 50% or more of the total voting power or value of all the then
outstanding Voting Securities of such corporation or (ii) in the case of a
partnership, limited liability company, association or other business entity
(“Business Entity”), 50% or more of the partnership or other similar ownership
interest of such Business Entity; and (b) “Voting Security” means any security
of a corporation which carries the right to vote generally in the election of
directors. For purposes of the definition of “Control,” (x) a Person will be
deemed to have a 50% or more ownership interest in a Business Entity if such
Person is allocated 50% or more of Business Entity gains or losses or controls
the managing director or member or general partner of such Business Entity; and
(y) “Controlling” and “Controlled” have meanings correlative thereto.

                    

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“Base Salary” has the meaning set forth in Section 4.01.

“Bonus Amount” means for termination of the Executive’s employment occurring
during a calendar year, the greater of (i) the Executive’s target annual bonus
for the year of such termination of employment, or (ii) the average of the
Executive’s actual annual bonus for the three immediately preceding years (or
such lesser number of years in which the Executive was employed by the Company
or its Affiliate).

“Cause” means (a) theft or embezzlement by the Executive with respect to the
Company or its Affiliates; (b) intentional malfeasance or gross negligence in
the performance of the Executive’s duties; (c) the conviction of the Executive
of any felony or any crime involving moral turpitude; (d) willful or prolonged
absence from work by the Executive (other than by reason of disability due to
physical or mental illness) or failure, neglect or refusal by the Executive to
perform his duties and responsibilities without the same being corrected within
ten (10) days after being given written notice thereof; (e) continued and
habitual use of alcohol by the Executive to an extent which materially impairs
the Executive’s performance of his duties; (f) the Executive’s use of illegal
drugs; or (g) the material breach by the Executive of any of the covenants
contained in this Agreement.

“Code” has the meaning set forth in Section 12.09.

“Confidential Information” means information that is not generally known to the
public and that was or is used, developed or obtained by the Company or its
Affiliates in connection with their business. It shall not include information
(a) required to be disclosed by court or administrative order (subject to the
Executive’s compliance with the notice requirements set forth in Section 6.01
below); (b) lawfully obtainable from other sources or which is in the public
domain through no fault of the Executive; or (c) the disclosure of which is
consented to by the Company.

“Date of Termination” has the meaning set forth in Section 5.06 and Section
5.02.

“Employment Period” has the meaning set forth in Section 2.01 and Section 5.02.

“Good Reason” means, without the Executive’s written consent and subject to the
timely notice requirement and the Company’s opportunity to cure set forth in
Section 5.05 below, (a) the material diminution of any material duties or
responsibilities of the Executive; (b) a material reduction in the Executive’s
Base Salary; (c) any material breach by the Company of the provisions contained
in this Agreement; or (d) a requirement that Executive relocate his principal
office to a location that is not within 50 miles of either Raleigh or
Greensboro, North Carolina.

“Intellectual Property” has the meaning set forth in Section 7.01.

“Notice of Termination” has the meaning set forth in Section 5.05.

“Noncompetition Period” has the meaning set forth in Section 9.01.

“Nonsolicitation Period” has the meaning set forth in Section 9.02.

“Person” means an individual, a partnership, a corporation, a limited liability
company, an association, a joint stock company, an estate, a trust, a joint
venture, an unincorporated organization or a governmental entity or any
department, agency or political subdivision thereof.

“Permanent Disability” means those circumstances where the Executive is unable
to continue to perform the usual customary duties of his assigned job or as
otherwise assigned in accordance with the provisions of this Agreement for a
period of six (6) consecutive months in any twelve (12) month period because of
physical, mental or emotional incapacity resulting from injury, sickness or
disease. Any questions as to the existence of a Permanent Disability shall be
determined by a qualified, independent physician selected by the Company and
approved by the

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Executive (which approval shall not be unreasonably withheld). The determination
of any such physician shall be final and conclusive for all purposes of this
Agreement.

“Reimbursable Expenses” has the meaning set forth in Section 4.04.

“Start Date” has the meaning set forth in Section 2.01.

ARTICLE 2

EMPLOYMENT

SECTION 2.01. Employment. The Company shall employ the Executive as provided
herein, and the Executive shall accept such employment, for the period beginning
as of March 1, 2019 (the “Start Date”) and ending as provided in Section 5.01
(the “Employment Period”). If the Executive fails to satisfy the condition set
forth in the preceding sentence, he shall forfeit all rights hereunder.

ARTICLE 3

POSITION AND DUTIES

SECTION 3.01. Position and Duties. During the Employment Period, the Executive
shall serve as Executive Chairman of the Company and shall have such
responsibilities, powers and duties as may from time to time be prescribed by
the Board of Directors of the Company; provided that such responsibilities,
powers and duties are substantially consistent with those customarily assigned
to individuals serving in such position at comparable companies or as may be
reasonably required by the conduct of the business of the Company. During the
Employment Period, the Executive shall also serve as the Chief Executive of the
Global Mortgage Group and shall have such responsibilities, powers and duties as
may from time to time be prescribed by the President and Chief Executive Officer
of Arch Capital Group Ltd.; provided that such responsibilities, powers and
duties are substantially consistent with those customarily assigned to
individuals serving in such position at comparable companies or as may be
reasonably required by the conduct of the business of the Company and its
Affiliates.

The Executive understands and agrees that in these positions, he will have
access to and become familiar with confidential and trade secret information
belonging to the Company and its Affiliates, the Company’s manner of doing
business, the manner in which Affiliates do business, future plans of the
Company and its Affiliates, and confidential information relating to customers,
employees, and business relations of the Company and its Affiliates. The
Executive acknowledges that such information has been and will be established at
great expense to the Company and its Affiliates and that the Company has a
legitimate business interest in protecting such information from disclosure to
competitors or otherwise.

During the Employment Period, the Executive shall devote substantially all of
his working time and efforts to the business and affairs of the Company and its
Affiliates. The Executive shall not directly or indirectly render any services
of a business, commercial or professional nature to any other person or
for-profit organization not related to the business of the Company or its
Affiliates, whether for compensation or otherwise, without prior written consent
of the Company. During the Employment Period, the Executive will comply with the
Company’s Code of Business Conduct, as in effect for time to time.

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ARTICLE 4

BASE SALARY AND BENEFITS

SECTION 4.01. Base Salary. During the Employment Period, the Executive’s base
salary will be $650,000 per annum (the “Base Salary”). The Base Salary will be
payable by the Company bi-monthly on the 15th and last working day of each
month. Annually during the Employment Period, the Company shall review with the
Executive his job performance and compensation, and if deemed appropriate by the
Company, in its discretion, the Executive’s Base Salary may be increased.

SECTION 4.02. Bonuses. In addition to the Base Salary, the Executive shall be
eligible to participate in an annual bonus plan on terms set forth from time to
time by the Board of Directors of the Company. The Executive’s target annual
bonus during the Employment Period will be 135% of his Base Salary.

SECTION 4.03. Benefits. In addition to the Base Salary, and any bonuses payable
to the Executive pursuant to this Agreement, the Executive shall be entitled to
the following benefits during the Employment Period:

(a)     such major medical, life insurance and disability insurance coverage as
is, or may during the Employment Period be, provided generally for other senior
executive officers of the Company as set forth from time to time in the
applicable plan documents;

(b)     in accordance with applicable policies, 27 paid vacation days and 10
sick days annually (vacation days will be pro-rated for partial years, sick days
will be front loaded annually) during the Employment Period; and

(c)     benefits under any plan or arrangement available generally for the
senior executive officers of the Company, including the Executive Supplemental
Non-Qualified Savings and Retirement Plan, subject to and consistent with the
terms and conditions and overall administration of such plans as set forth from
time to time in the applicable plan documents.

SECTION 4.04. Expenses. The Company shall reimburse the Executive for all
reasonable expenses incurred by him in the course of performing his duties under
this Agreement which are consistent with the Company’s policies in effect from
time to time with respect to travel, entertainment and other business expenses
(“Reimbursable Expenses”), subject to the Company’s requirements with respect to
reporting and documentation of expenses.

SECTION 4.05. Share-Based Awards. The Executive shall be eligible to participate
in the Company’s Long Term Incentive and Share Award Plans (and any similar plan
adopted by the Company) under which share-based awards may be granted, as
determined by the Board of Directors of the Company in its discretion.

SECTION 4.06 Equity Award. Subject to approval by the Board of Directors of Arch
Capital Group Ltd. (“Parent”), on the date this Agreement has been
fully-executed by the parties (“Grant Date”), the Executive will receive a
signing bonus consisting of the share-based awards of Parent valued at $376,250
in the aggregate, consisting of (a) 80.12% performance shares of Parent
(“Performance Shares”) and (b) 19.88% non-qualified options to purchase common
shares of Parent (“Stock Options”) (with the percentages relating to the value
of each award component). The Performance Shares will vest on March 10, 2022
(based on achievement of performance goals), and the Stock Options will vest in
three equal annual installments on the first anniversary of the Grant Date,
February 28, 2021 and February 28, 2022, provided that, in each case, on each
such date the Executive is still an employee of the Company as set forth in the
award agreements.

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For these purposes, the (a) the number of Performance Shares will be determined
by dividing the performance award target award value by the closing price of
Parent’s common shares on the Grant Date and (b) the number of Stock Options
will be determined by Parent based on a Black-Scholes valuation consistent with
the manner in which Parent reflects options in its consolidated financial
statements. The Stock Options will have an exercise price per share equal to the
closing market price of Parent’s common shares on the Grant Date. The terms and
conditions of the Performance Shares and the Stock Options will be as set forth
in the award agreements.

ARTICLE 5

TERM AND TERMINATION

SECTION 5.01. Term. The Employment Period will terminate on the third
anniversary of the Start Date; provided that (a) the Employment Period shall
terminate prior to such date upon the Executive’s death or Permanent Disability,
(b) the Employment Period may be terminated by the Company for any reason prior
to such date, and (c) the Employment Period may be terminated by the Executive
prior to such date, if such termination shall be for Good Reason. In addition,
this Agreement will be automatically extended on the same terms and conditions
for successive one year periods following the original term until either the
Company or the Executive, at least ninety (90) days prior to the expiration of
the original term or any extended term, shall give written notice of their
intention not to renew the Agreement. Upon termination of the Executive’s
employment with the Company for any reason, the Executive shall resign from all
positions and in all capacities with the Company and its Affiliates or from any
other company or other Person with which the Executive is serving at the
Company’s request.

SECTION 5.02. Unjustified Termination. Except as otherwise provided in Section
12.09, if the Employment Period shall be terminated (i) at the end of the
Employment Period due to the Company giving written notice of non-extension
pursuant to Section 5.01 above, or (ii) prior to the expiration of the original
term (or the Employment Period as extended pursuant to Section 5.01) by the
Executive for Good Reason or by the Company not for Cause (such terminations
under clauses (i) and (ii) of this Section 5.02 are collectively referred to as
“Unjustified Terminations”), the Executive shall be paid solely (except as
additionally provided in Section 5.04 below or the Company’s Incentive
Compensation Plan or successor plan) his Base Salary and accrued but unused
vacation days in accordance with the Company’s policies earned through the date
of termination of employment and an amount equal to the sum of (A) his annual
Base Salary, (B) his target annual bonus, (C) a pro-rated portion of the
Executive’s target annual bonus based on the number of days elapsed in the
calendar year through the Date of Termination, (D) payments under the Company’s
Incentive Compensation Plan for underwriting years during which the Executive
was a participant in the Plan in accordance with the terms of such plan, (E)
unvested stock options, stock appreciation rights, restricted stock or
restricted stock units, and any other unvested equity awards (other than
performance-based awards) that have been (i) granted on or after the date hereof
and (ii) held by the Executive for at least one year since the applicable grant
date will vest upon the Date of Termination, and such stock options and stock
appreciation rights will be exercisable for a period of 90 days from such Date
of Termination (except that the vesting and exercisability of such awards shall
instead be governed by the applicable award agreements in the event such
termination of employment occurs within two years after a Change in Control (as
defined in the applicable award agreement) or after the attainment of Retirement
Age (as defined in the applicable award agreement)), and (F) unvested
performance shares and performance share units that have been (i) granted on or
after the date hereof and (ii) held by the Executive for at least one year since
the applicable grant date will vest upon the Date of Termination based upon the
lesser of:  (x) target performance, or (y) the actual level of achievement of
all relevant performance goals (measured as of the latest date immediately
preceding the Date of Termination for which performance can, as a practical
matter, be determined) (except that the vesting of such awards shall instead be
governed by the applicable award agreements in the event such termination of
employment occurs within two years after a Change in Control or after the
attainment of Retirement Age).

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The Executive shall be entitled to such payments and accelerated vesting,
settlement and exercisability set forth in clauses (A), (B), (C), (D), (E) and
(F) of this Section only if the Executive has fully complied with and continues
to fully comply with the provisions of Sections 6.01, 7.01, 8.01, 9.01 or 9.02
hereof and the Executive has entered into a general release of claims reasonably
satisfactory to the Company on or before the date that is fifty (50) days
following the Date of Termination and does not revoke such release prior to the
end of the statutory seven (7) day revocation period (it being understood that
such general release will not require the Executive to release his rights under
Sections 5.02 and 5.04 of this Agreement and will not contain any employment
restrictions or non-solicitation obligations other than those set forth in this
Agreement).

Subject to Section 12.09 below, such amounts set forth in clauses (A), (B) and
(C) will be paid in twelve (12) equal installments, the first two (2) of which
shall be paid on the date that is two (2) months following the Date of
Termination and the next ten (10) of which will be paid in ten (10) equal
monthly installments commencing on the date that is three (3) months following
the Date of Termination and continuing on each of the next nine (9) monthly
anniversaries of the Date of Termination. In addition, promptly following an
Unjustified Termination, the Executive shall also be reimbursed for all
Reimbursable Expenses incurred by the Executive prior to such Unjustified
Termination. Notwithstanding any provision hereof to the contrary, in order for
the Executive to terminate the Employment Period for Good Reason, such
termination of employment must occur no later than sixty (60) days after the
date the Executive gives written notice in accordance with Section 5.05 below to
the Company of the occurrence of the event or condition that constitutes Good
Reason.

The amount otherwise payable under clause (A) of this Section 5.02 will be
increased as follows in the event a termination of the Executive’s employment
described in this Section 5.02 occurs within the following periods (and not
within two years after a Change in Control): (I) if such termination occurs
prior to June 1, 2020, the amount will be increased by 150% of the Base Salary
as in effect on the date hereof; (II) if such termination of employment occurs
on or after June, 1, 2020 and prior to June 1, 2021, the amount will be
increased by 100% of the Base Salary as in effect on the date hereof; (III) if
such termination of employment occurs on or after June 1, 2021 and prior to
June,1 2022, the amount will be increased by 50% of the Base Salary as in effect
on the date hereof; and (IV) if such termination of employment occurs on or
after June 1, 2022, the amount will not be increased.  

SECTION 5.03. Justified Termination. If the Employment Period shall be
terminated (i) prior to the expiration of the original term (or the Employment
Period as extended pursuant to Section 5.01) (a) by the Company for Cause, (b)
as a result of the Executive’s resignation or leaving of his employment, other
than for Good Reason or (c) as a result of the death or Permanent Disability of
the Executive, or (ii) at the end of the Employment Period as a result of the
Executive’s provision of written notice not to extend the Employment Period
under Section 5.01 (such terminations under clauses (i) and (ii) of this Section
5.03 are collectively referred to as “Justified Terminations”), the Executive
shall be entitled to receive solely (except as additionally provided in Section
5.04 below or the Company’s Incentive Compensation Plan or successor plan) his
Base Salary earned through the date of termination of employment, accrued but
unused vacation days in accordance with the Company’s policies, and
reimbursement of all Reimbursable Expenses incurred by the Executive prior to
such Justified Termination.

SECTION 5.04. Benefits. Except as otherwise required by mandatory provisions of
law, all of the Executive’s rights to fringe and other benefits under this
Agreement or otherwise, if any, accruing after the termination of the Employment
Period will cease upon such termination. Notwithstanding the foregoing, if such
termination is a result of a Permanent Disability or if the Employment Period is
terminated as a result of an Unjustified Termination, the Executive and
dependents shall continue to receive his major medical insurance coverage
benefits from the Company’s plan in effect from time to time (provided the
Executive continues to pay the portion of the premiums for such coverage that
are charged to similarly situated active employees) for a period equal to the
lesser of (i) twelve (12) months after the Date of Termination, and (ii) until
the Executive is provided by another employer with benefits substantially
comparable (with no pre-existing condition limitations) to the benefits provided
by such plan. The continuation of such benefits under this Section shall only be
available if the Executive has fully complied with and continues to fully comply
with the provisions of Sections 6.01, 7.01, 8.01, 9.01 or 9.02 of this
Agreement.

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SECTION 5.05. Notice of Termination and Opportunity to Cure. Any termination by
the Company for Permanent Disability or Cause or without Cause or by the
Executive for Good Reason shall be communicated by written Notice of Termination
to the other party hereto. For purposes of this Agreement, a “Notice of
Termination” shall mean a notice which shall indicate the date the termination
is to take effect (consistent with the terms of this Agreement), the specific
termination provision in this Agreement relied upon and, for a termination for
Permanent Disability or for Cause or for a resignation for Good Reason, shall
set forth in reasonable detail the facts and circumstances claimed to provide a
basis for termination of employment under the provision indicated. It shall be a
condition precedent to the Executive’s right to terminate employment for Good
Reason that (i) the Executive shall first have given the Company written notice
that an event or condition constituting Good Reason has occurred within ninety
(90) days after such occurrence, and any failure to give such written notice
within such period will result in a waiver by the Executive of his right to
terminate for Good Reason as a result of such event or condition, and (ii) a
period of thirty (30) days from and after the giving of such written notice
shall have elapsed without the Company having effectively cured or remedied such
occurrence during such 30-day period, unless such occurrence cannot be cured or
remedied within thirty (30) days, in which case the period for remedy or cure
shall be extended for a reasonable time (not to exceed an additional fifteen
(15) days) provided that the Company has made and continues to make a diligent
effort to effect such remedy or cure.

SECTION 5.06. Date of Termination. “Date of Termination” shall mean (a) if the
Employment Period is terminated as a result of a Permanent Disability, five (5)
days after a Notice of Termination is given, (b) if the Employment Period is
terminated by the Executive for Good Reason, the date specified in the Notice of
Termination consistent with the terms hereof, (c) if the Employment Period
terminates due to expiration of the term of this Agreement, the date the term
expires, and (d) if the Employment Period is terminated for any other reason
(including for Cause), the date designated by the Company in the Notice of
Termination.

ARTICLE 6

CONFIDENTIAL INFORMATION

SECTION 6.01. Nondisclosure and Nonuse of Confidential Information. The
Executive will not disclose or use at any time during or after the Employment
Period any Confidential Information of which the Executive is or becomes aware,
whether or not such information is developed by him, except to the extent that
such disclosure or use is directly related to and required by the Executive’s
performance of duties assigned to the Executive pursuant to this Agreement.
Under all circumstances and at all times, the Executive will take all reasonably
appropriate steps to safeguard Confidential Information in his possession and to
protect it against disclosure, misuse, espionage, loss and theft. If the
Executive is compelled by court or administrative order to disclose information
that would otherwise be considered Confidential Information, the Executive will
first give the Company prompt written notice of any such requirement, disclose
no more information than is so required in the opinion of competent legal
counsel, and cooperate fully with any efforts by the Company to obtain a
protective order or similar confidentiality treatment for such information.
Nothing in this Agreement, however, or any other agreement or arrangement with
the Company or any of its Affiliates shall require the Executive to give notice
to the Company prior to the Executive making any disclosure of information or
documents to any governmental agency or legislative body, any self-regulatory
organization, the Legal Department of the Company, and/or pursuant to the
whistleblower provisions of the Dodd-Frank Act or Sarbanes-Oxley Act.
SECTION 6.02. Defend Trade Secrets Act. Pursuant to 18 U.S.C. § 1833(b), the
Executive understands that the Executive will not be held criminally or civilly
liable under any Federal or State trade secret law for the disclosure of a trade
secret of the Company that (i) is made (x) in confidence to a Federal, State, or
local government official, either directly or indirectly, or to the Executive’s
attorney and (y) solely for the purpose of reporting or investigating a
suspected violation of law; or (ii) is made in a complaint or other document
that is filed under seal in a lawsuit or other proceeding. The Executive
understands that if the Executive files a lawsuit for retaliation by the Company
for reporting a suspected violation of law, the Executive may disclose the trade
secret to the Executive’s attorney and use the trade secret information in the
court proceeding if the Executive (I) files any

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document containing the trade secret under seal, and (II) does not disclose the
trade secret, except pursuant to court order. Nothing in this Agreement is
intended to conflict with 18 U.S.C. § 1833(b) or create liability for
disclosures of trade secrets that are expressly allowed by such section.
Further, nothing in this Agreement or any other agreement or arrangement with
the Company or any of its Affiliates shall prohibit or restrict the Executive
from making any disclosure of information or documents to any governmental
agency or legislative body, any self-regulatory organization, the Legal
Department of the Company, and/or pursuant to the whistleblower provisions of
the Dodd-Frank Act or Sarbanes-Oxley Act.
ARTICLE 7

INTELLECTUAL PROPERTY

SECTION 7.01. Ownership of Intellectual Property. In the event that the
Executive as part of his activities on behalf of the Company or its Affiliates
generates, authors or contributes to any invention, design, new development,
device, product, method of process (whether or not patentable or reduced to
practice or comprising Confidential Information), any copyrightable work
(whether or not comprising Confidential Information) or any other form of
Confidential Information relating directly or indirectly to the business of the
Company or its Affiliates as now or hereinafter conducted (collectively,
“Intellectual Property”), the Executive acknowledges that such Intellectual
Property is the sole and exclusive property of the Company and its Affiliates
and hereby assigns all right title and interest in and to such Intellectual
Property to the Company and its Affiliates. Any copyrightable work prepared in
whole or in part by the Executive during employment with the Company will be
deemed “a work made for hire” under Section 201(b) of the United States
Copyright Act of 1976, as amended, and the Company and its Affiliates will own
all of the rights comprised in the copyright therein. The Executive will
promptly and fully disclose all Intellectual Property and will cooperate with
the Company and its Affiliates to protect the interests of the Company and its
Affiliates in and rights to such Intellectual Property (including providing
reasonable assistance in securing patent protection and copyright registrations
and executing all documents as reasonably requested by the Company or its
Affiliates, whether such requests occur prior to or after termination of the
Executive’s employment hereunder).

ARTICLE 8

DELIVERY OF MATERIALS UPON TERMINATION OF EMPLOYMENT

SECTION 8.01. Delivery of Materials upon Termination of Employment. As requested
by the Company from time to time and upon the termination of the Executive’s
employment with the Company for any reason, the Executive will promptly deliver
to the Company all property of the Company and its Affiliates in the Executive’s
possession or within his control, including, without limitation, all copies and
embodiments, in whatever form or medium, of all Confidential Information or
Intellectual Property (including written records, notes, photographs, manuals,
notebooks, documentation, program listings, flow charts, magnetic media, disks,
diskettes, tapes and all other materials containing any Confidential Information
or Intellectual Property), irrespective of the location or form of such property
and, if requested by the Company, will provide the Company with written
confirmation that all such property have been delivered to the Company.

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ARTICLE 9

NONCOMPETITION AND NONSOLICITATION

SECTION 9.01. Noncompetition. The Executive acknowledges that during his
employment with the Company, he will become familiar with trade secrets and
other Confidential Information concerning the Company and its Affiliates and
their respective predecessors, and that his services will be of special, unique
and extraordinary value to the Company. In addition, the Executive hereby agrees
that during the Noncompetition Period, he will not directly or indirectly own,
manage, control, participate in, be employed by, consult with, render services
for, provide work for, become associated with, or in any manner engage in any
Restricted Business in the Restricted Area. With respect to the twelve (12)
month period after the Executive’s employment ends, the restriction on work only
applies to the Executive providing executive level services, whether as an
employee or independent contractor, or otherwise providing work or services in
an executive level position.
For purposes of this Agreement, the “Noncompetition Period” shall mean the
Employment Period, together with any period following the Employment Period
during which the Executive remains an employee of the Company or its Affiliate,
and the period of twelve (12) months following termination of the Executive’s
employment for any reason;
provided, however, that if the Executive’s termination of employment occurs as a
result of the Executive’s resignation or leaving of his employment other than
for Good Reason or at the end of the Employment Period as a result of the
Executive’s provision of written notice not to extend the Employment Period
under Section 5.01, except as provided in clause (Y) below, the Noncompetition
Period shall continue beyond such termination of employment only if (i) the
Company pays the Executive, for each day during which the Noncompetition Period
so continues, an amount equal to 1/365th of the sum of (I) the Executive’s
annual Base Salary, plus (II) his Bonus Amount for the calendar year of such
termination of employment, and (III) a pro-rated portion of the Executive’s
Bonus Amount based on the number of days elapsed in the calendar year through
the Date of Termination, such amount to be paid in accordance with the regular
payroll practices of the Company (except that any amount otherwise payable prior
to the sixtieth (60th) day following the termination date shall instead be paid
on such sixtieth (60th) day); and (ii) the Executive shall continue to receive
his major medical insurance coverage benefits from the Company’s plan in effect
from time to time (provided the Executive continues to pay the portion of the
premiums for such coverage that are charged to similarly situated active
employees) for a period equal to the lesser of (x) the end of the Noncompetition
Period, and (y) until the Executive is provided by another employer with
benefits substantially comparable (with no pre-existing condition limitations)
to the benefits provided by such plan; and provided further, however, that:
(X) the Company may elect, in its sole discretion, by written notice to the
Executive given not more than ten (10) business days after the date the
Executive’s employment terminates, to reduce the Noncompetition Period under
such circumstances so that it ends on the date set forth in such written notice
(which shall not be later than twelve (12) months after the termination date),
in which case the Company’s obligation to make payments and provide benefits
under this Section 9.01 shall end at the end of the Noncompetition Period, and

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(Y) the Company’s requirement to make payments under this Section 9.01 as a
condition to continuation of the Noncompetition Period shall apply only if the
Executive has entered into a general release of claims reasonably satisfactory
to the Company on or before the date that is fifty (50) days following the Date
of Termination and does not revoke such release prior to the end of the
statutory seven (7) day revocation period (it being understood that such general
release will not require the Executive to release his rights under this Section
9.01 and will not contain any employment restrictions or non-solicitation
obligations other than those set forth in this Agreement) and the Executive has
fully complied with and continues to fully comply with the provisions of
Sections 6.01, 7.01, 8.01, 9.01, 9.02 or 10.01 hereof.
For the avoidance of doubt, amounts shall not be payable under both this Section
9.01 and Section 5.02. The Executive understands and agrees that should the
Executive fail to fully comply with any of the obligations specified in Sections
6.01, 7.01, 8.01, 9.01, or 9.02 hereof, it will result in a forfeiture of any
compensation and benefits to which the Executive may otherwise be entitled
pursuant to clauses (A), (B), (C), (D), (E) and (F) of Section 5.02 of this
Agreement or Section 9.01 of this Agreement.
“Restricted Business” means (i) providing services or products relating to
mortgage insurance or reinsurance, (ii) any business competing with the
business(es) of the Company or its Affiliates as such business(es) exist as of
the date of the Executive’s termination (for any reason), (iii) any business
competing with the business(es) that were conducted by the Company or its
Affiliates at any time during the twelve (12) months prior to the Executive’s
termination (for any reason); or (iv) any business competing with the
business(es) that were being actively developed by the Company or its Affiliates
and with which the Executive was involved to a material extent during the twelve
(12) months prior to termination of the Executive’s employment (for any reason).
This restriction only applies to businesses of the Company or its Affiliates
with which the Executive was materially involved or for which the Executive had
access to confidential information.
“Restricted Area” consists of the areas specified in Appendix A attached hereto.
The parties acknowledge that the Company engages in and actively seeks business
throughout the United States and that the Company’s Affiliates engage in and
actively seek business throughout the world. The parties further acknowledge
that the Executive will have access to confidential information relating to all
of the Company’s Affiliates and regularly participate in strategic business
discussions and decisions relating to the Company’s Affiliates. Thus, a
worldwide restriction is necessary to protect the legitimate business interests
of the Company and its Affiliates.
The Executive hereby acknowledges that the period of time, scope, and territory
relating to this noncompetition provision are reasonable and necessary for the
protection of the Company in the operation of business and do not unduly
restrict the Executive’s ability to provide for himself and/or his family during
the Noncompetition Period or to pursue adequate employment opportunities.
It shall not be considered a violation of this Section 9.01 for the Executive to
be a passive owner of not more than 2% of the outstanding stock of any class of
a corporation which is publicly traded, so long as the Executive has no active
participation in the business of such corporation.

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SECTION 9.02. Nonsolicitation. The Executive acknowledges that during his
employment with the Company, he will become familiar with trade secrets and
other Confidential Information concerning the Company, its Affiliates and their
respective predecessors, and that his services will be of special, unique and
extraordinary value to the Company. The Executive hereby agrees that during the
Employment Period, together with any period following the Employment Period
during which the Executive remains an employee of the Company or its Affiliate,
and for a period of one (1) year after the date of termination of employment for
any reason (the “Nonsolicitation Period”), the Executive will not, directly or
indirectly:

(i)    solicit, induce, or attempt to solicit or induce any Relevant Employee of
the Company to leave the employ of the Company, for any reason whatsoever;

(ii)    solicit, induce, or attempt to solicit or induce any Relevant Employee
of one of the Company’s Affiliates to leave the employ of that Affiliate, for
any reason whatsoever;

(iii)    in any way disrupt or interfere with the relationship, contractual or
otherwise between the Company and any Relevant Employee thereof;

(iv)    in any way disrupt or interfere with the relationship, contractual or
otherwise between one of the Company’s Affiliates and any Relevant Employee
thereof; or

(v)    hire, employ, or receive the work or services of any Relevant Employee
which are the same or similar to the work or services that Relevant Employee
provided to the Company or its Affiliates.

For purposes of this Agreement, a “Relevant Employee” shall mean any individual
who was employed with the Company or any Affiliate of the Company as a director,
officer, executive, underwriter or manager at any time during the twelve (12)
month period prior to the termination of the Executive’s employment (for any
reason) and with whom the Executive had contact during the Executive’s
employment with the Company or became aware of as a result of the Executive’s
employment with the Company.

The Executive further agrees that during the Nonsolicitation Period, the
Executive will not, directly or indirectly:

    (i)    solicit, induce, or attempt to solicit or induce any Restricted
Customer to cease doing business with the Company; or

(ii)    solicit, induce, or attempt to solicit or induce any Restricted Customer
to cease doing business with any Affiliate of the Company.

For purposes of this Agreement, a “Restricted Customer” shall mean any firm,
company, or Person who was a customer, investor, supplier, client, insured,
reinsured, reinsurer, broker, agent, licensee or other business relation of the
Company or any of its Affiliates at any time during the twelve (12) month period
prior to the termination of the Executive’s employment (for any reason) and with
whom the Executive had contact during the Executive’s employment with the
Company or became aware of as a result of the Executive’s employment with the
Company.

SECTION 9.03. Enforcement. If, at the enforcement of Section 9.01 or 9.02, a
court holds that the duration, territory, or scope stated therein are
unreasonable under circumstances then existing, the parties agree that the
maximum duration, territory, and scope reasonable under such circumstances will
be substituted for the stated duration or scope and it is the parties’ intention
that the court will revise the restrictions contained in this Article 9 to cover
the maximum duration and scope permitted by law.

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ARTICLE 10

EQUITABLE RELIEF

SECTION 10.01. Injunctive or Other Equitable Relief. The Executive acknowledges
that (a) the covenants contained herein are reasonable, (b) the Executive’s
services are unique, and (c) a breach or threatened breach by him of any of his
covenants and agreements with the Company and its Affiliates contained in
Sections 6.01, 7.01, 8.01, 9.01 or 9.02 could cause irreparable harm to the
Company or its Affiliates for which they would have no adequate remedy at law.
Accordingly, and in addition to any remedies which the Company and its
Affiliates may have at law, in the event of an actual or threatened breach by
the Executive of his covenants and agreements contained in Sections 6.01, 7.01,
8.01, 9.01 or 9.02, the Company and its Affiliates shall have the absolute
right, without the need to post a bond or any other type of security, to
commence a lawsuit or other proceeding in any court of competent jurisdiction
(the “Selected Court”) seeking injunctive or other equitable relief (an
“Injunction Proceeding”). In furtherance thereof, the Executive expressly and
irrevocably agrees that the Selected Court may exercise personal jurisdiction
over him in connection with any Injunction Proceeding and further agrees not to
assert that any court other than the Selected Court is a more suitable forum for
an Injunction Proceeding.

ARTICLE 11

EXECUTIVE REPRESENTATIONS

SECTION 11.01. Executive Representations. The Executive hereby represents and
warrants to the Company that (a) the execution, delivery and performance of this
Agreement by the Executive does not and will not conflict with, breach, violate
or cause a default under any contract, agreement, instrument, order, judgment or
decree to which the Executive is a party or by which he is bound, (b) the
Executive is not a party to or bound by any employment agreement, noncompetition
agreement or confidentiality agreement with any other Person that affects his
right or ability to perform the duties contemplated by this Agreement, and (c)
upon the execution and delivery of this Agreement by the Company, this Agreement
will be the valid and binding obligation of the Executive, enforceable in
accordance with its terms.

ARTICLE 12

MISCELLANEOUS

SECTION 12.01. Remedies. The Company will have all rights and remedies set forth
in this Agreement, all rights and remedies which the Company has been granted at
any time under any other agreement or contract and all of the rights which the
Company has under any law. The Company will be entitled to enforce such rights
specifically, without posting a bond or other security, to recover damages by
reason of any breach of any provision of this Agreement and to exercise all
other rights granted by law. There are currently no disciplinary or grievance
procedures in place, there is no collective agreement in place, and there is no
probationary period.

SECTION 12.02. Consent to Amendments. The provisions of this Agreement may be
amended or waived only by a written agreement executed and delivered by the
Company and the Executive. No other course of dealing between the parties to
this Agreement or any delay in exercising any rights hereunder will operate as a
waiver of any rights of any such parties.

SECTION 12.03. Successors and Assigns. All covenants and agreements contained in
this Agreement by or on behalf of any of the parties hereto will bind and inure
to the benefit of the respective successors and assigns of the parties hereto
whether so expressed or not, provided that the Executive may not assign his
rights or delegate his obligations under this Agreement without the written
consent of the Company.

SECTION 12.04. Severability. Whenever possible, each provision of this Agreement
will be interpreted in such manner as to be effective and valid under applicable
law, but if any provision of this Agreement is held to be

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prohibited by or invalid under applicable law, such provision will be
ineffective only to the extent of such prohibition or invalidity, without
invalidating the remainder of this Agreement.

SECTION 12.05. Counterparts. This Agreement may be executed simultaneously in
two counterparts, any one of which need not contain the signatures of more than
one party, but all of which counterparts taken together will constitute one and
the same agreement.

SECTION 12.06. Descriptive Headings. The descriptive headings of this Agreement
are inserted for convenience only and do not constitute a part of this
Agreement.

SECTION 12.07. Notices. All notices, demands or other communications to be given
or delivered under or by reason of the provisions of this Agreement will be in
writing and shall be delivered personally by hand, by electronic transmission
(with a copy following by hand or by overnight courier), by registered or
certified mail, postage prepaid, return receipt requested, or by overnight
courier service (charges prepaid). Communications delivered personally by hand
shall be deemed received on the date when delivered personally to the recipient;
communications sent by electronic means shall be deemed received one (1)
business day after the sending thereof; communications sent by registered or
certified mail shall be deemed received four (4) business days after the sending
thereof; and communications delivered by overnight courier shall be deemed
received one (1) business day after the date when sent to the recipient. Such
notices, demands and other communications will be sent to the Executive and to
the Company at the addresses set forth below.

If to the Executive:
To the last address delivered to the Company by the Executive in the manner set
forth herein.

    
If to the Company:
Arch U.S. MI Services Inc.
230 N. Elm St

Greensboro NC 27401
Attn: General Counsel

or to such other address or to the attention of such other person as the
recipient party has specified by prior written notice to the sending party.

SECTION 12.08. Withholding. The Company may withhold from any amounts payable
under this Agreement such federal, state, local or foreign taxes as shall be
required to be withheld pursuant to any applicable law or regulation.

SECTION 12.09. Sections 409A. It is intended that this Agreement will comply
with Sections 409A of the Internal Revenue Code of 1986, as amended (the “Code”)
(and any regulations and guidelines issued thereunder), to the extent the
Agreement is subject thereto, and the Agreement shall be interpreted on a basis
consistent with such intent. If an amendment of the Agreement is necessary in
order for it to comply with Section 409A, the parties hereto will negotiate in
good faith to amend the Agreement in a manner that preserves the original intent
of the parties to the extent reasonably possible. No action or failure to act,
pursuant to this Section 12.09 shall subject the Company to any claim,
liability, or expense, and the Company shall not have any obligation to
indemnify or otherwise protect the Executive from the obligation to pay any
taxes, interest or penalties pursuant to Section 409A of the Code.

Notwithstanding any provision to the contrary in this Agreement, if the
Executive is deemed on the date of his “separation from service” (within the
meaning of Treasury Regulation Section 1.409A-1(h)) to be a “specified employee”
within the meaning of that term under Section 409A(a)(2)(B) of the Code, then
with regard to any payment that is required to be delayed pursuant to Section
409A(a)(2)(B) of the Code (after taking into account the applicable provisions
of Treasury Regulation Section 1.409A-1(b)(9)(iii)), the portion, if any, of
such payment so required to be delayed shall not be made prior to the earlier of
(i) the expiration of the six (6)-month period measured from the date of his
“separation from service” or (ii) the date of his death (the “Delay Period”).
Upon

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the expiration of the Delay Period, all payments and benefits delayed pursuant
to this Section (whether they would have otherwise been payable in a single sum
or in installments in the absence of such delay) shall be paid or reimbursed to
the Executive in a lump sum, and any remaining payments due under this Agreement
shall be paid in accordance with the normal payment dates specified for them
herein. Whenever payments under this Agreement are to be made in installments,
each such installment shall be deemed to be a separate payment for purposes of
Section 409A of the Code. Notwithstanding any provision of this Agreement to the
contrary, for purposes of any provision of this Agreement providing for the
payment of any amounts or benefits upon or following a termination of employment
that are considered deferred compensation under Section 409A, references to the
Executive’s “termination of employment” (and corollary terms) with the Company
shall be construed to refer to the Executive’s “separation from service” (within
the meaning of Treas. Reg. Section 1.409A-1(h)) with the Company. In no case
will compliance with this Section by the Company constitute a breach of the
Company’s obligations under this Agreement.
    
With respect to any reimbursement or in-kind benefit arrangements of the Company
and its subsidiaries that constitute deferred compensation for purposes of
Section 409A, except as otherwise permitted by Section 409A, the following
conditions shall be applicable: (i) the amount eligible for reimbursement, or
in-kind benefits provided, under any such arrangement in one calendar year may
not affect the amount eligible for reimbursement, or in-kind benefits to be
provided, under such arrangement in any other calendar year (except that the
health and dental plans may impose a limit on the amount that may be reimbursed
or paid), (ii) any reimbursement must be made on or before the last day of the
calendar year following the calendar year in which the expense was incurred, and
(iii) the right to reimbursement or in-kind benefits is not subject to
liquidation or exchange for another benefit.

SECTION 12.10. Excess Parachute Payments.

(a)    Notwithstanding any other provision of this Agreement, in the event that
the amount of payments or other benefits payable to the Executive under this
Agreement (including, without limitation, the acceleration of any payment or the
accelerated vesting of any payment or other benefit), together with any
payments, awards or benefits payable under any other plan, program, arrangement
or agreement maintained by the Company or one of its Affiliates, would
constitute an “excess parachute payment” (within the meaning of Section 280G of
the Code), the payments under Section 5.02 of this Agreement shall be reduced
(by the minimum possible amounts) until no amount payable to the Executive under
this Agreement constitutes an “excess parachute payment” (within the meaning of
Section 280G of the Code); provided, however, that no such reduction shall be
made if the net after-tax payment (after taking into account federal, state,
local or other income, employment and excise taxes) to which the Executive would
otherwise be entitled without such reduction would be greater than the net
after-tax payment (after taking into account federal, state, local or other
income, employment and excise taxes) to the Executive resulting from the receipt
of such payments with such reduction.

(b)    All determinations required to be made under this Section 12.10,
including whether a payment would result in an “excess parachute payment” and
the assumptions to be utilized in arriving at such determinations, shall be made
by a nationally recognized accounting or consulting firm designated by the
Company (the “Accounting Firm”) which shall provide detailed supporting
calculations both to the Company and the Executive as requested by the Company
or the Executive. All fees and expenses of the Accounting Firm shall be borne
solely by the Company and shall be paid by the Company. Absent manifest error,
all determinations made by the Accounting Firm under this Section 12.10 shall be
final and binding upon the Company and the Executive.

SECTION 12.11. No Third Party Beneficiary. This Agreement will not confer any
rights or remedies upon any person other than the Company and its Affiliates,
the Executive and their respective heirs, executors, successors and assigns.

SECTION 12.12. Entire Agreement. This Agreement (including the documents
referred to herein) constitutes the entire agreement among the parties and
supersedes any prior understandings, agreements or representations by or among
the parties, written or oral, that may have related in any way to the subject
matter

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hereof, including, without limitation, the Employment Agreement dated as of
April 7, 2017, between the Company and the Executive.

SECTION 12.13. Construction. The language used in this Agreement will be deemed
to be the language chosen by the parties to express their mutual intent, and no
rule of strict construction will be applied against any party. Any reference to
any federal, state, local or foreign statute or law will be deemed also to refer
to all rules and regulations promulgated thereunder, unless the context requires
otherwise. The use of the word “including” in this Agreement means including
without limitation and is intended by the parties to be by way of example rather
than limitation.

SECTION 12.16. Survival. Sections 5.02, 5.04, 6.01, 6.02, 7.01, 8.01 and
Articles 9, 10, 11 and 12 will survive and continue in full force in accordance
with their terms notwithstanding any termination of the Employment Period.

SECTION 12.17. GOVERNING LAW. ALL QUESTIONS CONCERNING THE CONSTRUCTION,
VALIDITY AND INTERPRETATION OF THIS AGREEMENT WILL BE GOVERNED BY THE INTERNAL
LAW OF NORTH CAROLINA, WITHOUT REGARD TO PRINCIPLES OF CONFLICT OF LAWS.

SECTION 12.18. Arbitration. Except when the Company or its Affiliates exercise
their right to seek injunctive or other equitable relief pursuant to Section
10.01 above, all disputes between the parties arising out of, in connection with
or concerning this Agreement or any share-based award agreements between the
Company and the Executive (collectively, the “Disputes”) shall be adjudicated in
a confidential private arbitration to be conducted in accordance with the
comprehensive rules and procedures of JAMS (the “JAMS Rules”), including, but
not limited to, the internal appeal process provided for in JAMS Rule 34 (the
“Arbitration”). The Arbitration shall be conducted before a panel of three
arbitrators (the “Panel”), one appointed by the Company, another appointed by
the Executive and the third appointed by the other two arbitrators (or, if the
two arbitrators cannot agree, the third arbitrator shall be appointed by JAMS).
Subject to the JAMS Rules, in-person hearings in the arbitration shall be held
in Wake County, State of North Carolina, and shall be conducted in English. The
parties shall each pay fifty percent (50%) of the Panel’s fees and other costs
billed to the parties by JAMS for the Arbitration. Notwithstanding the
immediately preceding sentence, each of the parties shall pay its own attorneys’
fees and costs incurred in connection with the Arbitration. The Panel shall have
no authority to render an award that requires either of the parties to pay the
attorneys’ fees or costs incurred by the other party in connection with the
Arbitration or otherwise. A Judgment upon a final award rendered by the Panel,
after giving effect to the JAMS internal appeal process, may be sought and
entered in any court having jurisdiction thereof (an “Enforcement Proceeding”).
If JAMS is not in business or is no longer providing arbitration services, then
the American Arbitration Association shall be substituted for JAMS for the
purposes of this Section 12.18. Each party shall maintain the confidentiality of
the Arbitration (including any award rendered therein), except as necessary in
connection with an Enforcement Proceeding or as otherwise required by law.

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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of the
date and year first above written.

ARCH U.S. MI SERVICES INC.
By: /s/ R. Michael Schmeiser    
Name: R. Michael Schmeiser    
Title: President & CEO        
Date: October 1, 2019    
    
/s/ David Gansberg    
David Gansberg
                        Date: September 27, 2019___        

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APPENDIX A

The term “Restricted Area” as used in this Agreement, consists of:
(i)    the area throughout the world; and
(ii)    the following countries:
(a)    United States;
(b)    Bermuda
(c)    the countries in Europe;
(d)    United Kingdom;
(e)    Ireland;
(f)    France;
(g)    Switzerland;
(h)    Germany;
(i)    Sweden;
(j)    Finland;
(k)    Italy;
(l)    Australia;
(m)    Canada;
(n)    Mexico;
(o)    Peru;
(p)    South Korea;
(q)    Hong Kong;
(r)    any other country in which the Company is engaged in a Restricted
Business; and
(s)    any other country in which an Affiliate of the Company is engaged in a
Restricted Business.