Exhibit 10.6

For Nonemployee Directors

For grants to Directors on or after

August 4, 2010 pursuant to the 2008 Plan

ALTERRA CAPITAL HOLDINGS LIMITED

2008 STOCK INCENTIVE PLAN

RESTRICTED STOCK AWARD AGREEMENT

This Restricted Stock Award Agreement (the “Agreement”) is made, effective as of
the          day of                 , 2         (the “Grant Date”), by and
between Alterra Capital Holdings Limited (the “Company”) and
                     (the “Grantee”).

RECITALS:

WHEREAS, the Company has adopted the Alterra Capital Holdings Limited 2008 Stock
Incentive Plan (the “Plan”) pursuant to which awards of restricted common shares
of the Company (“Common Shares”) may be granted; and

WHEREAS, the Committee has determined that it is in the best interests of the
Company and its shareholders to grant the award of restricted Common Shares
provided for herein (the “Restricted Stock Award”) to the Grantee in recognition
of the Grantee’s services to the Company, such grant to be subject to the terms
set forth herein.

NOW, THEREFORE, in consideration for the mutual covenants hereinafter set forth,
the parties hereto agree as follows:

 

1. Grant of Restricted Stock Award. Pursuant to Section 9 of the Plan, the
Company hereby issues to the Grantee on the Grant Date a Restricted Stock Award
consisting of, in the aggregate,              Common Shares in the capital of
the Company (hereinafter called the “Restricted Stock”).

 

2. Incorporation by Reference. The provisions of the Plan are hereby
incorporated herein by reference. Except as otherwise expressly set forth
herein, this Agreement shall be construed in accordance with the provisions of
the Plan and any capitalized terms not otherwise defined in this Agreement shall
have the definitions set forth in the Plan. The Committee shall have the
authority to interpret and construe the Plan and this Agreement and to make any
and all determinations thereunder, and its decision shall be binding and
conclusive upon the Grantee and his/her legal representative in respect of any
questions arising under the Plan or this Agreement.

 

3.

Restrictions. Except as provided in the Plan or this Agreement, the restrictions
on the Restricted Stock are that they will be forfeited by the Grantee and all
of the Grantee’s rights to such shares shall immediately terminate without any
payment or consideration by the Company, in the event of any sale, assignment,
transfer, hypothecation, pledge or other alienation of such Restricted Stock
made or attempted, whether voluntary or

 

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involuntary, and if involuntary whether by process of law in any civil or
criminal suit, action or proceeding, whether in the nature of an insolvency or
bankruptcy proceeding or otherwise, without the written consent of the Board.

 

4. Vesting.

 

  (a) Except as otherwise provided herein, the restrictions described in
Section 3 above will lapse with respect to 100% of the Restricted Stock on the
third anniversary of the Grant Date (the “Vesting Date”); provided, that, except
as otherwise provided herein, the Grantee is then serving as a director on the
Board. If the Grantee’s service as a director on the Board is terminated at any
time prior to the Vesting Date, the unvested Restricted Stock shall
automatically be forfeited upon such cessation of service, unless otherwise
provided in this Section 4.

 

  (b) Death, Disability. In the event of the Grantee’s death or upon the
Grantee’s removal from the Board on account of Disability (as defined below),
100% of the Restricted Stock shall vest as of the date of such termination.

For purposes of this Agreement, “Disability” shall mean the removal of the
Grantee as a director on the Board upon 30 days’ notice in the event that the
Grantee suffers a mental or physical disability that shall have prevented
him/her from performing his/her material duties for a period of at least 120
consecutive days or 180 non-consecutive days within any 365 day period;
provided, that, the Grantee shall not have returned to full-time performance of
his/her duties within 30 days following receipt of such notice.

 

  (c) Retirement. Subject to the Committee’s approval, upon the Grantee’s
Retirement, vesting shall continue according to the schedule set forth in
Section 4(a) as if the Grantee continued to serve as a director on the Board.

For purposes of this Agreement, “Retirement” shall be defined as the Grantee’s
termination of service as a director on the Board on account of his/her
voluntary resignation if the Grantee’s age is at least 55 and the Grantee has at
least five consecutive years of service as a director on the Board immediately
prior to the termination date.

 

  (d) Change in Control. Upon the occurrence of a Change in Control (as defined
in the Plan) that occurs following the one year anniversary of the Grant Date,
or upon any termination of services in connection with a Change in Control, all
Restricted Stock shall automatically become vested and immediately
nonforfeitable in full.

 

  (e) Not Re-Elected. In the event that the Grantee’s service on the Board is
terminated as a result of a shareholder vote, 100% of the Restricted Stock shall
vest as of the date of such termination.

 

5.

Rights as Shareholder; Dividends. The Grantee shall be the record owner of the
Restricted Shares unless and until such Common Shares are sold or otherwise
disposed

 

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of, and as record owner shall be entitled to all rights of a shareholder of the
Company, including, without limitation, voting rights, if any, with respect to
the Restricted Shares and the right to receive dividends, if any, while the
Restricted Shares are held in custody.

 

6. Compliance with Laws and Regulations. The issuance and transfer of Common
Shares shall be subject to compliance by the Company and the Grantee with all
applicable requirements of securities laws and with all applicable requirements
of any stock exchange on which the Company’s Common Shares may be listed at the
time of such issuance or transfer.

 

7. No Right to Continued Service. Nothing in this Agreement shall confer upon
the Grantee any right to continue to serve the Company or shall affect the right
of the Company to terminate the Grantee’s service as a director.

 

8. Notices. All notices, demands and other communications provided for or
permitted hereunder shall be made in writing and shall be delivered by
registered or certified first class mail, return receipt requested, telecopier,
courier service or personal delivery:

If to the Company:

Alterra Capital Holdings Limited

Alterra House

2 Front Street

Hamilton HM 11

Bermuda

If to the Grantee, at the Grantee’s last known address on file with the Company.

All such notices, demands and other communications shall be deemed to have been
duly given when delivered by hand, if personally delivered; when delivered by
courier, if delivered by commercial courier service; five (5) business days
after being deposited in the mail, postage prepaid, if mailed; and when receipt
is mechanically acknowledged, if telecopied.

 

9. Bound by Plan. By signing this Agreement, the Grantee acknowledges that
he/she has received a copy of the Plan and has had an opportunity to review the
Plan and agrees to be bound by all of the terms and provisions of the Plan.

 

10. Beneficiary. The Grantee may file with the Committee a written designation
of a beneficiary on such form as may be prescribed by the Committee and may,
from time to time, amend or revoke such designation. If no designated
beneficiary survives the Grantee, the beneficiary shall be deemed to be the
Grantee’s spouse or, if the Grantee is unmarried at the time of death, his or
her estate.

 

11. Successors. The terms of this Agreement shall be binding upon and inure to
the benefit of the Company, its successors and assigns, and on the Grantee and
the beneficiaries, executors and administrators, heirs and successors of the
Grantee.

 

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12. Amendment of Restricted Stock Award. Subject to Section 14 of this
Agreement, the Committee at any time and from time to time may amend the terms
of this Restricted Stock Award; provided, however, the Grantee’s rights under
this Restricted Stock Award shall not be materially and adversely affected by
any such amendment without the Grantee’s consent.

 

13. Adjustments. This Restricted Stock Award is subject to adjustment pursuant
to Section 12 of the Plan.

 

14. Governing Law; Modification. This Agreement shall be governed by the laws of
the state of New York without regard to the conflict of law principles. The
Agreement may not be modified except in writing signed by both parties.

 

15. Interpretation. Any dispute regarding the interpretation of this Agreement
shall be submitted by the Grantee or the Company to the Committee for review.
The resolution of such a dispute by the Committee shall be binding on the
Company and the Grantee.

 

16. Severability. Every provision of this Agreement is intended to be severable
and any illegal or invalid term shall not affect the validity or legality of the
remaining terms.

 

17. Headings. The headings of the Sections hereof are provided for convenience
only and are not to serve as a basis for interpretation of construction, and
shall not constitute a part of this Agreement.

 

18. Signature in Counterparts. This Agreement may be signed in counterparts,
each of which shall be deemed an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.

[SIGNATURE PAGE FOLLOWS]

 

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IN WITNESS WHEREOF, the parties hereto have signed this Agreement as of the date
set forth below.

 

ALTERRA CAPITAL HOLDINGS LIMITED By:       

Name:

Title:

Date:

GRANTEE By:       

Name:

Date:

 

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For Nonemployee Directors

For grants to Directors on or after

August 4, 2010 pursuant to the 2006 Plan

ALTERRA CAPITAL HOLDINGS LIMITED

AMENDED AND RESTATED

2006 EQUITY INCENTIVE PLAN

RESTRICTED STOCK AWARD AGREEMENT

This Restricted Stock Award Agreement (the “Agreement”) is made, effective as of
the          day of                 , 2         (the “Grant Date”), by and
between Alterra Capital Holdings Limited (the “Company”) and
                     (the “Grantee”).

RECITALS:

WHEREAS, the Company has adopted the Alterra Capital Holdings Limited Amended
and Restated 2006 Equity Incentive Plan (the “Plan”) pursuant to which awards of
restricted common shares of the Company (“Common Shares”) may be granted; and

WHEREAS, the Committee has determined that it is in the best interests of the
Company and its shareholders to grant the award of restricted Common Shares
provided for herein (the “Restricted Stock Award”) to the Grantee in recognition
of the Grantee’s services to the Company, such grant to be subject to the terms
set forth herein.

NOW, THEREFORE, in consideration for the mutual covenants hereinafter set forth,
the parties hereto agree as follows:

 

1. Grant of Restricted Stock Award. Pursuant to Section 5 of the Plan, the
Company hereby issues to the Grantee on the Grant Date a Restricted Stock Award
consisting of, in the aggregate,              Common Shares in the capital of
the Company (hereinafter called the “Restricted Stock”).

 

2. Incorporation by Reference. The provisions of the Plan are hereby
incorporated herein by reference. Except as otherwise expressly set forth
herein, this Agreement shall be construed in accordance with the provisions of
the Plan and any capitalized terms not otherwise defined in this Agreement shall
have the definitions set forth in the Plan. The Committee shall have the
authority to interpret and construe the Plan and this Agreement and to make any
and all determinations thereunder, and its decision shall be binding and
conclusive upon the Grantee and his/her legal representative in respect of any
questions arising under the Plan or this Agreement.

 

3.

Restrictions. Except as provided in the Plan or this Agreement, the restrictions
on the Restricted Stock are that they will be forfeited by the Grantee and all
of the Grantee’s rights to such shares shall immediately terminate without any
payment or consideration by the Company, in the event of any sale, assignment,
transfer, hypothecation, pledge or

 

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other alienation of such Restricted Stock made or attempted, whether voluntary
or involuntary, and if involuntary whether by process of law in any civil or
criminal suit, action or proceeding, whether in the nature of an insolvency or
bankruptcy proceeding or otherwise, without the written consent of the Board.

 

4. Vesting.

 

  (a) Except as otherwise provided herein, the restrictions described in
Section 3 above will lapse with respect to 100% of the Restricted Stock on the
third anniversary of the Grant Date (the “Vesting Date”); provided, that, except
as otherwise provided herein, the Grantee is then serving as a director on the
Board. If the Grantee’s service as a director on the Board is terminated at any
time prior to the Vesting Date, the unvested Restricted Stock shall
automatically be forfeited upon such cessation of service, unless otherwise
provided in this Section 4.

 

  (b) Death, Disability. In the event of the Grantee’s death or upon the
Grantee’s removal from the Board on account of Disability (as defined below),
100% of the Restricted Stock shall vest as of the date of such termination.

For purposes of this Agreement, “Disability” shall mean the removal of the
Grantee as a director on the Board upon 30 days’ notice in the event that the
Grantee suffers a mental or physical disability that shall have prevented
him/her from performing his/her material duties for a period of at least 120
consecutive days or 180 non-consecutive days within any 365 day period;
provided, that, the Grantee shall not have returned to full-time performance of
his/her duties within 30 days following receipt of such notice.

 

  (c) Retirement. Subject to the Committee’s approval, upon the Grantee’s
Retirement, vesting shall continue according to the schedule set forth in
Section 4(a) as if the Grantee continued to serve as a director on the Board.

For purposes of this Agreement, “Retirement” shall be defined as the Grantee’s
termination of service as a director on the Board on account of his/her
voluntary resignation if the Grantee’s age is at least 55 and the Grantee has at
least five consecutive years of service as a director on the Board immediately
prior to the termination date.

 

  (d) Change in Control. Upon the occurrence of a Change in Control (as defined
in the Plan) that occurs following the one year anniversary of the Grant Date,
or upon any termination of services in connection with a Change in Control, all
Restricted Stock shall automatically become vested and immediately
nonforfeitable in full.

 

  (e) Not Re-Elected. In the event that the Grantee’s service on the Board is
terminated as a result of a shareholder vote, 100% of the Restricted Stock shall
vest as of the date of such termination.

 

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5. Rights as Shareholder; Dividends. The Grantee shall be the record owner of
the Restricted Shares unless and until such Common Shares are sold or otherwise
disposed of, and as record owner shall be entitled to all rights of a
shareholder of the Company, including, without limitation, voting rights, if
any, with respect to the Restricted Shares and the right to receive dividends,
if any, while the Restricted Shares are held in custody.

 

6. Compliance with Laws and Regulations. The issuance and transfer of Common
Shares shall be subject to compliance by the Company and the Grantee with all
applicable requirements of securities laws and with all applicable requirements
of any stock exchange on which the Company’s Common Shares may be listed at the
time of such issuance or transfer.

 

7. No Right to Continued Service. Nothing in this Agreement shall confer upon
the Grantee any right to continue to serve the Company or shall affect the right
of the Company to terminate the Grantee’s service as a director.

 

8. Notices. All notices, demands and other communications provided for or
permitted hereunder shall be made in writing and shall be delivered by
registered or certified first class mail, return receipt requested, telecopier,
courier service or personal delivery:

If to the Company:

Alterra Capital Holdings Limited

Alterra House

2 Front Street

Hamilton HM 11

Bermuda

If to the Grantee, at the Grantee’s last known address on file with the Company.

All such notices, demands and other communications shall be deemed to have been
duly given when delivered by hand, if personally delivered; when delivered by
courier, if delivered by commercial courier service; five (5) business days
after being deposited in the mail, postage prepaid, if mailed; and when receipt
is mechanically acknowledged, if telecopied.

 

9. Bound by Plan. By signing this Agreement, the Grantee acknowledges that
he/she has received a copy of the Plan and has had an opportunity to review the
Plan and agrees to be bound by all of the terms and provisions of the Plan.

 

10. Beneficiary. The Grantee may file with the Committee a written designation
of a beneficiary on such form as may be prescribed by the Committee and may,
from time to time, amend or revoke such designation. If no designated
beneficiary survives the Grantee, the beneficiary shall be deemed to be the
Grantee’s spouse or, if the Grantee is unmarried at the time of death, his or
her estate.

 

11. Successors. The terms of this Agreement shall be binding upon and inure to
the benefit of the Company, its successors and assigns, and on the Grantee and
the beneficiaries, executors and administrators, heirs and successors of the
Grantee.

 

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12. Amendment of Restricted Stock Award. Subject to Section 14 of this
Agreement, the Committee at any time and from time to time may amend the terms
of this Restricted Stock Award; provided, however, the Grantee’s rights under
this Restricted Stock Award shall not be materially and adversely affected by
any such amendment without the Grantee’s consent.

 

13. Adjustments. This Restricted Stock Award is subject to adjustment pursuant
to Section 4(b) of the Plan.

 

14. Governing Law; Modification. This Agreement shall be governed by the laws of
the state of New York without regard to the conflict of law principles. The
Agreement may not be modified except in writing signed by both parties.

 

15. Interpretation. Any dispute regarding the interpretation of this Agreement
shall be submitted by the Grantee or the Company to the Committee for review.
The resolution of such a dispute by the Committee shall be binding on the
Company and the Grantee.

 

16. Severability. Every provision of this Agreement is intended to be severable
and any illegal or invalid term shall not affect the validity or legality of the
remaining terms.

 

17. Headings. The headings of the Sections hereof are provided for convenience
only and are not to serve as a basis for interpretation of construction, and
shall not constitute a part of this Agreement.

 

18. Signature in Counterparts. This Agreement may be signed in counterparts,
each of which shall be deemed an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.

[SIGNATURE PAGE FOLLOWS]

 

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IN WITNESS WHEREOF, the parties hereto have signed this Agreement as of the date
set forth below.

 

ALTERRA CAPITAL HOLDINGS LIMITED By:       

Name:

Title:

Date:

GRANTEE By:       

Name:

Date:

 

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