EXHIBIT 10.42

 

INDEMNIFICATION AGREEMENT

 

THIS AGREEMENT is entered into, effective as of December 21, 2005 by and between
Assured Guaranty Ltd., a Bermuda company (the “Company”),
and                      (“Indemnitee”).

 

WHEREAS, it is essential to the Company to retain and attract as directors and
officers the most capable persons available;

 

WHEREAS, Indemnitee is a director and/or officer of the Company;

 

WHEREAS, both the Company and Indemnitee recognize the increased risk of
litigation and other claims currently being asserted against directors and
officers of corporations;

 

WHEREAS, the Bye-Laws of the Company require the Company to indemnify its
directors and officers to the fullest extent permitted by law, and permit the
Company to advance expenses relating to the defense of indemnification matters,
and the Indemnitee has been serving and continues to serve as a director and/or
officer of the Company in part in reliance on the Company’s Bye-Laws;

 

WHEREAS, in recognition of Indemnitee’s need for (i) substantial protection
against personal liability based on Indemnitee’s reliance on the aforesaid
Bye-Laws, (ii) specific contractual assurance that the protection promised by
the Bye-Laws will be available to Indemnitee (regardless of, among other things,
any amendment to or revocation of the Bye-Laws or any change in the composition
of the Company’s Board of Directors or acquisition transaction relating to the
Company), and (iii) an inducement to provide effective services to the Company
as a director and/or officer, the Company wishes to provide in this Agreement
for the indemnification of and the advancing of expenses to Indemnitee to the
fullest extent (whether partial or complete) permitted under law and as set
forth in this Agreement, and, to provide for the continued coverage of
Indemnitee under the Company’s directors’ and officers’ liability insurance
policies; and

 

WHEREAS, the Board of Directors has determined that contractual indemnification
as set forth herein is reasonable and prudent and promotes the best interests of
the Company and its shareholders;

 

NOW, THEREFORE, in consideration of the above premises and of Indemnitee
continuing to serve the Company directly or, at its request, with another
enterprise, and intending to be legally bound hereby, the parties agree as
follows:

 

1.             Certain Definitions:

 

(a)           Board: the Board of Directors of the Company.

 

--------------------------------------------------------------------------------

 

(b)           Affiliate: any corporation or other person or entity that
directly, or indirectly through one or more intermediaries, controls or is
controlled by, or is under common control with, the person specified.

 

(c)           Change in Control: shall be deemed to have occurred if:

 

(i)            any “person,” as such term is used in Sections 3(a)(9) and 13(d)
of the United States Securities Exchange Act of 1934, becomes a “beneficial
owner,” as such term is used in Rule 13d-3 promulgated under that act, of 25% or
more of the Voting Stock (as defined below) of the Company;

 

(ii)           the majority of the Board consists of individuals other than
Incumbent Directors, which term means the members of the Board on the Effective
Date; provided that any person becoming a director subsequent to such date whose
election or nomination for election was supported by three-quarters of the
directors who then comprised the Incumbent Directors shall be considered to be
an Incumbent Director;

 

(iii)          the Company adopts any plan of liquidation providing for the
distribution of all or substantially all of its assets;

 

(iv)          all or substantially all of the assets or business of the Company
is disposed of pursuant to a merger, consolidation or other transaction (unless
the shareholders of the Company immediately prior to such merger, consolidation
or other transaction beneficially own, directly or indirectly, in substantially
the same proportion as they owned the Voting Stock of the Company, all of the
Voting Stock or other ownership interests of the entity or entities, if any,
that succeed to the business of the Company); or

 

(v)           the Company combines with another company and is the surviving
corporation but, immediately after the combination, the shareholders of the
Company immediately prior to the combination hold, directly or indirectly, 50%
or less of the Voting Stock of the combined company (there being excluded from
the number of shares held by such shareholders, but not from the Voting Stock of
the combined company, any shares received by Affiliates (as defined below) of
such other company in exchange for stock of such other company).

 

For the purpose of this definition of “Change in Control,” (I) an “Affiliate” of
a person or other entity shall mean a person or other entity that directly or
indirectly controls, is controlled by, or is under common control with the
person or other entity specified and (II) “Voting Stock” shall mean capital
stock of any class or classes having general voting power under ordinary
circumstances, in the absence of contingencies, to elect the directors of a
corporation.

 

(d)           Expenses: any expense, liability, or loss, including attorneys’
fees, judgments, fines, ERISA excise taxes and penalties, amounts paid or to be
paid in settlement, any interest, assessments, or other charges imposed thereon,
any federal, state, local, or foreign taxes imposed as a result of the actual or
deemed receipt of any

 

2

--------------------------------------------------------------------------------

 

payments under this Agreement, and all other costs and obligations, paid or
incurred in connection with investigating, defending, prosecuting (subject to
Section 2(b)), being a witness in, participating in (including on appeal), or
preparing for any of the foregoing in, any Proceeding relating to any
Indemnifiable Event.

 

(e)           Indemnifiable Event: any event or occurrence that takes place
either prior to or after the execution of this Agreement, directly or
indirectly, related to the fact that Indemnitee is or was a director or officer
of the Company, or while a director or officer is or was serving at the request
of the Company as a director, officer, employee, trustee, agent, or fiduciary of
another foreign or domestic corporation, partnership, limited liability company,
joint venture, employee benefit plan, trust, or other enterprise, or was a
director, officer, employee, or agent of a foreign or domestic corporation that
was a predecessor corporation of the Company or of another enterprise at the
request of such predecessor corporation, or related to anything done or not done
by Indemnitee in any such capacity, whether or not the basis of the Proceeding
is alleged action in an official capacity as a director, officer, employee, or
agent or in any other capacity while serving as a director, officer, employee,
or agent of the Company, as described above.

 

(f)            Independent Counsel: the person or body appointed in connection
with Section 3.

 

(g)           Proceeding: any threatened, pending, or completed action, suit, or
proceeding or any alternative dispute resolution mechanism (including an action
by or in the right of the Company), or any inquiry, hearing, or investigation,
whether conducted by the Company or any other party, that Indemnitee in good
faith believes might lead to the institution of any action, suit, or proceeding,
whether civil, criminal, administrative, investigative, or other.

 

(h)           Reviewing Party: the person or body appointed in accordance with
Section 3.

 

(i)            Voting Securities: any securities of the Company that vote
generally in the election of directors.

 

2.             Agreement to Indemnify.

 

(a)           General Agreement. In the event Indemnitee was, is, or becomes a
party to or witness or other participant in, or is threatened to be made a party
to or witness or other participant in, a Proceeding by reason of (or arising in
part out of) an Indemnifiable Event, the Company shall indemnify Indemnitee from
and against any and all Expenses to the fullest extent permitted by law, as the
same exists or may hereafter be amended or interpreted (but in the case of any
such amendment or interpretation, only to the extent that such amendment or
interpretation permits the Company to provide broader indemnification rights
than were permitted prior thereto). The parties hereto intend that this
Agreement shall provide for indemnification in excess of that expressly
permitted by statute, including, without limitation, any indemnification
provided by the Company’s Bye-Laws, vote of its shareholders or disinterested
directors, or applicable law; provided

 

3

--------------------------------------------------------------------------------

 

that this indemnity shall not extend to any matter which may attach to
Indemnitee in respect of any fraud or dishonesty on the part of Indemnitee, as
determined by a final and non-appealable judicial determination.

 

(b)           Initiation of Proceeding. Notwithstanding anything in this
Agreement to the contrary, Indemnitee shall not be entitled to indemnification
pursuant to this Agreement in connection with any Proceeding initiated by
Indemnitee against the Company or any director or officer of the Company unless
(i) the Company has joined in or the Board has consented to the initiation of
such Proceeding; (ii) the Proceeding is one to enforce indemnification rights
under this Agreement; or (iii) the Proceeding is instituted after a Change in
Control (other than a Change in Control approved by a majority of the directors
on the Board who were directors immediately prior to such Change in Control) and
Independent Counsel has approved its initiation.

 

(c)           Expense Advances. If so requested by Indemnitee, the Company shall
advance (within ten business days of such request) any and all Expenses to
Indemnitee (an “Expense Advance”); provided that, (i) such an Expense Advance
shall be made only upon delivery to the Company of an undertaking by or on
behalf of the Indemnitee to repay the amount thereof if it is ultimately
determined that Indemnitee is not entitled to be indemnified by the Company, and
(ii) if and to the extent that the Reviewing Party determines that Indemnitee
would not be permitted to be so indemnified under applicable law, the Company
shall be entitled to be reimbursed by Indemnitee (who hereby agrees to reimburse
the Company) for all such amounts theretofore paid. If Indemnitee has commenced
or commences legal proceedings in a court of competent jurisdiction to secure a
determination that Indemnitee should be indemnified under applicable law, as
provided in Section 4, any determination made by the Reviewing Party that
Indemnitee would not be permitted to be indemnified under applicable law shall
not be binding, and Indemnitee shall not be required to reimburse the Company
for any Expense Advance until a final judicial determination is made with
respect thereto (as to which all rights of appeal therefrom have been exhausted
or have lapsed). Indemnitee’s obligation to reimburse the Company for Expense
Advances shall be unsecured and no interest shall be charged thereon.

 

(d)           Mandatory Indemnification. Notwithstanding any other provision of
this Agreement, to the extent that Indemnitee has been successful on the merits
or otherwise in defense of any Proceeding relating in whole or in part to an
Indemnifiable Event or in defense of any issue or matter therein, Indemnitee
shall be indemnified against all Expenses incurred in connection therewith.  For
purposes of this Agreement and without limiting the foregoing, if any action,
suit or proceeding is disposed of, on the merits or otherwise (including a
disposition without prejudice), without (i) the disposition being adverse to
Indemnitee, (ii) an adjudication that Indemnitee was liable to the Company,
(iii) a plea of guilty or nolo contendere by Indemnitee or (iv) an adjudication
that Indemnitee is not entitled to the indemnification provided by this
Agreement, Indemnitee shall be considered for the purposes hereof to have been
wholly successful with respect thereto.

 

4

--------------------------------------------------------------------------------

 

(e)           Partial Indemnification. If Indemnitee is entitled under any
provision of this Agreement to indemnification by the Company for some or a
portion of Expenses, but not, however, for the total amount thereof, the Company
shall nevertheless indemnify Indemnitee for the portion thereof to which
Indemnitee is entitled.

 

(f)            Prohibited Indemnification. No indemnification pursuant to this
Agreement shall be paid by the Company:

 

(i)            on account of any Proceeding in which judgment is rendered
against Indemnitee for an accounting of profits made from the purchase or sale
by Indemnitee of securities of the Company pursuant to the provisions of
Section 16(b) of the Securities Exchange Act of 1934, as amended, or similar
provisions of any federal, state, or local laws; or

 

(ii)           if a court of competent jurisdiction by a final judicial
determination, shall determine that such indemnity is not permitted under
applicable law.

 

(g)           Contribution.  In order to provide for just and equitable
contribution in circumstances in which the indemnification provided for herein
is held by a court of competent jurisdiction to be unavailable to Indemnitee in
whole or in part or is insufficient to hold Indemnitee harmless, it is agreed
that, in such event, the Company shall, to the fullest extent permitted by law,
contribute to the payment of Indemnitee’s costs, charges and expenses (including
attorneys’ fees), judgments, fines and amounts paid in settlement with respect
to any action, suit or proceeding, whether civil, criminal, administrative or
investigative, in an amount that is just and equitable in the circumstances,
taking into account, among other things, contributions by other directors and
officers of the Company or others pursuant to indemnification agreements or
otherwise; provided, that, without limiting the generality of the foregoing,
such contribution shall not be required where such holding by the court is due
to any limitation on indemnification set forth in Section 2(f), 6(c) or 13
hereof.

 

3.             Reviewing Party. Prior to any Change in Control, the Reviewing
Party shall be any appropriate person or body consisting of a member or members
of the Board or any other person or body appointed by the Board who is not a
party to the particular Proceeding with respect to which Indemnitee is seeking
indemnification; after a Change in Control, the Independent Counsel referred to
below shall become the Reviewing Party. With respect to all matters arising
after a Change in Control (other than a Change in Control approved by a majority
of the directors on the Board who were directors immediately prior to such
Change in Control) concerning the rights of Indemnitee to indemnity payments and
Expense Advances under this Agreement or any other agreement or under applicable
law or the Company’s Bye-Laws now or hereafter in effect relating to
indemnification for Indemnifiable Events, the Company shall seek legal advice
only from Independent Counsel selected by Indemnitee and approved by the Company
(which approval shall not be unreasonably withheld), and who has not otherwise
performed services for the Company or the Indemnitee (other than in connection
with indemnification matters) within the last five years. The Independent
Counsel shall not include any person who, under the applicable

 

5

--------------------------------------------------------------------------------

 

standards of professional conduct then prevailing, would have a conflict of
interest in representing either the Company or Indemnitee in an action to
determine Indemnitee’s rights under this Agreement. Such counsel, among other
things, shall render its written opinion to the Company and Indemnitee as to
whether and to what extent the Indemnitee should be permitted to be indemnified
under applicable law. The Company agrees to pay the reasonable fees of the
Independent Counsel and to indemnify fully such counsel against any and all
expenses (including attorneys’ fees), claims, liabilities, loss, and damages
arising out of or relating to this Agreement or the engagement of Independent
Counsel pursuant hereto.

 

4.             Indemnification Process and Appeal.

 

(a)           Indemnification Payment. Indemnitee shall be entitled to
indemnification of Expenses, and shall receive payment thereof, from the Company
in accordance with this Agreement as soon as practicable after Indemnitee has
made written demand on the Company for indemnification, unless the Reviewing
Party has given a written opinion to the Company that Indemnitee is not entitled
to indemnification under applicable law.

 

(b)           Suit to Enforce Rights; Arbitration. Regardless of any action by
the Reviewing Party, if Indemnitee has not received full indemnification within
thirty days after making a demand in accordance with Section 4(a), Indemnitee
shall have the right to enforce its indemnification rights under this Agreement
by commencing litigation in any court of competent jurisdiction seeking an
initial determination by the court or challenging any determination by the
Reviewing Party or any aspect thereof.  Alternatively, Indemnitee, at his/her
option, may seek an award in arbitration to be conducted by a single arbitrator
pursuant to the Commercial Arbitration Rules of the American Arbitration
Association. The Company shall not oppose Indemnitee’s right to seek any such
adjudication or award in arbitration.  Any determination by the Reviewing Party
not challenged by Indemnitee shall be binding on the Company and Indemnitee. The
remedy provided for in this Section 4 shall be in addition to any other remedies
available to Indemnitee at law or in equity.

 

(c)           Defense to Indemnification, Burden of Proof, and Presumptions. It
shall be a defense to any action or arbitration proceeding brought by Indemnitee
against the Company to enforce this Agreement (other than an action brought to
enforce a claim for Expenses incurred in defending a Proceeding in advance of
its final disposition where the required undertaking has been tendered to the
Company) that it is not permissible under applicable law for the Company to
indemnify Indemnitee for the amount claimed. In connection with any such action
or arbitration proceeding or any determination by the Reviewing Party or
otherwise as to whether Indemnitee is entitled to be indemnified hereunder, the
burden of proving such a defense or determination shall be on the Company.
Neither the failure of the Reviewing Party or the Company (including its Board,
independent legal counsel, or its stockholders) to have made a determination
prior to the commencement of such action or arbitration proceeding by Indemnitee
that indemnification of the claimant is proper under the circumstances because
Indemnitee has met the standard of conduct set forth in applicable law, nor an
actual determination by the Reviewing Party or Company (including its Board,
independent legal counsel, or its stockholders) that the Indemnitee had not met
such applicable standard of conduct,

 

6

--------------------------------------------------------------------------------

 

shall be a defense to the action or create a presumption that the Indemnitee has
not met the applicable standard of conduct.  For purposes of this Agreement, to
the fullest extent permitted by law, the termination of any claim, action, suit,
or proceeding, by judgment, order, settlement (whether with or without court
approval), conviction, or upon a plea of nolo contendere, or its equivalent,
shall not create a presumption that Indemnitee did not meet any particular
standard of conduct or have any particular belief or that a court has determined
that indemnification is not permitted by applicable law.

 

5.             Indemnification for Expenses Incurred in Enforcing Rights. The
Company shall indemnify Indemnitee against any and all Expenses that are
incurred by Indemnitee in connection with any action or arbitration proceeding
brought by Indemnitee for

 

(a)           indemnification or advance payment of Expenses by the Company
under this Agreement or any other agreement or under applicable law or the
Company’s Bye-Laws now or hereafter in effect relating to indemnification for
Indemnifiable Events, and/or

 

(b)           recovery under directors’ and officers’ liability insurance
policies maintained by the Company, but only in the event that Indemnitee
ultimately is determined to be entitled to such indemnification or insurance
recovery, as the case may be. In addition, the Company shall, if so requested by
Indemnitee, advance the foregoing Expenses to Indemnitee, subject to and in
accordance with Section 2(c).

 

6.             Notification and Defense of Proceeding.

 

(a)           Notice. Promptly after receipt by Indemnitee of notice of the
commencement of any Proceeding, Indemnitee shall, if a claim in respect thereof
is to be made against the Company under this Agreement, notify the Company of
the commencement thereof; but the omission so to notify the Company will not
relieve the Company from any liability that it may have to Indemnitee, except as
provided in Section 6(c).

 

(b)           Defense. With respect to any Proceeding as to which Indemnitee
notifies the Company of the commencement thereof, the Company will be entitled
to participate in the Proceeding at its own expense and except as otherwise
provided below, to the extent the Company so wishes, it may assume the defense
thereof with counsel, and on terms and conditions, reasonably satisfactory to
Indemnitee. After notice from the Company to Indemnitee of its election to
assume the defense of any Proceeding, the Company shall not be liable to
Indemnitee under this Agreement or otherwise for any Expenses subsequently
incurred by Indemnitee in connection with the defense of such Proceeding other
than reasonable costs of investigation or as otherwise provided below.
Indemnitee shall have the right to employ legal counsel in such Proceeding, but
all Expenses related thereto incurred after notice from the Company of its
assumption of the defense shall be at Indemnitee’s expense unless: (i) the
employment of legal counsel by Indemnitee has been authorized by the Company,
(ii) Indemnitee has reasonably determined that there may be a conflict of
interest between Indemnitee and the Company in the defense of the Proceeding,
(iii) after a Change in Control (other than a Change in

 

7

--------------------------------------------------------------------------------

 

Control approved by a majority of the directors on the Board who were directors
immediately prior to such Change in Control), the employment of counsel by
Indemnitee has been approved by the Independent Counsel, or (iv) the Company
shall not in fact have employed counsel to assume the defense of such
Proceeding, in each of which cases all Expenses of the Proceeding shall be borne
by the Company. The Company shall not be entitled to assume the defense of any
Proceeding brought by or on behalf of the Company or as to which Indemnitee
shall have made the determination provided for in (ii), (iii) and (iv) above.

 

(c)           Settlement of Claims. The Company shall not be liable to indemnify
Indemnitee under this Agreement or otherwise for any amounts paid in settlement
of any Proceeding effected without the Company’s written consent, such consent
not to be unreasonably withheld; provided, however, that if a Change in Control
has occurred (other than a Change in Control approved by a majority of the
directors on the Board who were directors immediately prior to such Change in
Control), the Company shall be liable for indemnification of Indemnitee for
amounts paid in settlement if the Independent Counsel has approved the
settlement. The Company shall not settle any Proceeding in any manner that would
impose any penalty or limitation on Indemnitee without Indemnitee’s written
consent. The Company shall not be liable to indemnify the Indemnitee under this
Agreement with regard to any judicial award if the Company was not given a
reasonable and timely opportunity, at its expense, to participate in the defense
of such action; the Company’s liability hereunder shall not be excused if
participation in the Proceeding by the Company was barred by this Agreement.

 

7. Establishment of Trust. In the event of a Change in Control (other than a
Change in Control approved by a majority of the directors on the Board who were
directors immediately prior to such Change in Control) the Company shall, upon
written request by Indemnitee, create a Trust for the benefit of the Indemnitee
and from time to time upon written request of Indemnitee shall fund the Trust in
an amount sufficient to satisfy any and all Expenses reasonably anticipated at
the time of each such request to be incurred in connection with investigating,
preparing for, participating in, and/or defending any Proceeding relating to an
Indemnifiable Event. The amount or amounts to be deposited in the Trust pursuant
to the foregoing funding obligation shall be determined by the Independent
Counsel. The terms of the Trust shall provide that (i) the Trust shall not be
revoked or the principal thereof invaded without the written consent of the
Indemnitee, (ii) the Trustee shall advance, within ten business days of a
request by the Indemnitee, any and all Expenses to the Indemnitee (and the
Indemnitee hereby agrees to reimburse the Trust under the same circumstances for
which the Indemnitee would be required to reimburse the Company under
Section 2(c) of this Agreement), (iii) the Trust shall continue to be funded by
the Company in accordance with the funding obligation set forth above, (iv) the
Trustee shall promptly pay to the Indemnitee all amounts for which the
Indemnitee shall be entitled to indemnification pursuant to this Agreement or
otherwise, and (v) all unexpended funds in the Trust shall revert to the Company
upon a final determination by the Independent Counsel or a court of competent
jurisdiction, as the case may be, that the Indemnitee has been fully indemnified
under the terms of this Agreement. The Trustee shall be chosen by the
Indemnitee. Nothing in this Section 7 shall relieve the Company of any of its
obligations under this Agreement. All income earned on the assets held in the
Trust shall be reported as income by the Company for federal, state, local, and
foreign tax purposes. The Company shall pay all costs

 

8

--------------------------------------------------------------------------------

 

of establishing and maintaining the Trust and shall indemnify the Trustee
against any and all expenses (including attorneys’ fees), claims, liabilities,
loss, and damages arising out of or relating to this Agreement or the
establishment and maintenance of the Trust.

 

8.  Non-Exclusivity. The rights of Indemnitee hereunder shall be in addition to
any other rights Indemnitee may have under the Company’s Bye-Laws, applicable
law, or otherwise; provided, however, that this Agreement shall supersede any
prior indemnification agreement between the Company and the Indemnitee. To the
extent that a change in applicable law (whether by statute or judicial decision)
permits greater indemnification than would be afforded currently under the
Company’s Bye-Laws, applicable law, or this Agreement, it is the intent of the
parties that Indemnitee enjoy by this Agreement the greater benefits so afforded
by such change.

 

9.  Liability Insurance.  The Company shall use reasonable commercial efforts to
maintain an insurance policy or policies providing general liability and
directors’ and officers’ liability insurance, which shall cover Indemnitee, in
accordance with its or their terms, to the maximum extent of the coverage
available for any Company director or officer.

 

10.  Continuation of Contractual Indemnity or Period of Limitations. All
agreements and obligations of the Company contained herein shall continue for so
long as Indemnitee shall be subject to, or involved in, any proceeding for which
indemnification is provided pursuant to this Agreement.  Notwithstanding the
foregoing, no legal action shall be brought and no cause of action shall be
asserted by or on behalf of the Company or any Affiliate of the Company against
Indemnitee, Indemnitee’s spouse, heirs, executors, or personal or legal
representatives after the expiration of two years from the date of accrual of
such cause of action, or such longer period as may be required by Bermuda law
under the circumstances. Any claim or cause of action of the Company or its
Affiliate shall be extinguished and deemed released unless asserted by the
timely filing and notice of a legal action within such period; provided,
however, that if any shorter period of limitations is otherwise applicable to
any such cause of action, the shorter period shall govern.

 

11.           Amendment of this Agreement. No supplement, modification, or
amendment of this Agreement shall be binding unless executed in writing by both
of the parties hereto. No waiver of any of the provisions of this Agreement
shall be binding unless in the form of a writing signed by the party against
whom enforcement of the waiver is sought, and no such waiver shall operate as a
waiver of any other provisions hereof (whether or not similar), nor shall such
waiver constitute a continuing waiver. Except as specifically provided herein,
no failure to exercise or any delay in exercising any right or remedy hereunder
shall constitute a waiver thereof.

 

12.  Subrogation. In the event of payment under this Agreement, the Company
shall be subrogated to the extent of such payment to all of the rights of
recovery of Indemnitee, who shall execute all papers required and shall do
everything that may be necessary to secure such rights, including the execution
of such documents necessary to enable the Company effectively to bring suit to
enforce such rights.

 

13.  No Duplication of Payments. The Company shall not be liable under this
Agreement to make any payment in connection with any claim made against
Indemnitee to the extent Indemnitee has otherwise received payment (under any
insurance policy, Bye-Laws, or otherwise) of the amounts otherwise indemnifiable
hereunder.

 

9

--------------------------------------------------------------------------------

 

14.  Binding Effect. This Agreement shall be binding upon and inure to the
benefit of and be enforceable by the parties hereto and their respective
successors (including any direct or indirect successor by purchase, merger,
consolidation, or otherwise to all or substantially all of the business and/or
assets of the Company), assigns, spouses, heirs, and personal and legal
representatives. The Company shall require and cause any successor (whether
direct or indirect by purchase, merger, consolidation, or otherwise) to all,
substantially all, or a substantial part, of the business and/or assets of the
Company, by written agreement in form and substance satisfactory to Indemnitee,
expressly to assume and agree to perform this Agreement in the same manner and
to the same extent that the Company would be required to perform if no such
succession had taken place. The indemnification provided under this Agreement
shall continue as to Indemnitee for any action taken or not taken while serving
in an indemnified capacity pertaining to an Indemnifiable Event even though he
may have ceased to serve in such capacity at the time of any Proceeding.

 

15.  Severability. If any provision (or portion thereof) of this Agreement shall
be held by a court of competent jurisdiction to be invalid, void, or otherwise
unenforceable, the remaining provisions shall remain enforceable to the fullest
extent permitted by law.  Furthermore, to the fullest extent possible, the
provisions of this Agreement (including, without limitation, each portion of
this Agreement containing any provision held to be invalid, void, or otherwise
unenforceable, which is not itself invalid, void, or unenforceable) shall be
construed so as to give effect to the intent manifested by the provision held
invalid, void, or unenforceable.

 

16.  Governing Law; Submission to Jurisdiction. This Agreement shall be governed
by and construed and enforced in accordance with the laws of New York applicable
to contracts made and to be performed in such State without giving effect to its
principles of conflicts of laws.

 

The Company expressly accepts and irrevocably submits to the non-exclusive
jurisdiction of any United States Federal or New York State court sitting in the
Borough of Manhattan, The City of New York, New York, over any suit, action,
proceeding or arbitration proceeding arising out of or relating to this
Agreement or the transactions contemplated hereby.  To the fullest extent it may
effectively do so under applicable law, the Company irrevocably waives and
agrees not to assert, by way of motion, as a defense or otherwise, any claim
that it is not subject to the jurisdiction of any such court, any objection that
it may now or hereafter have to the laying of the venue of any such suit, action
or proceeding brought in any such court and any claim that any such suit, action
or proceeding brought in any such court has been brought in an inconvenient
forum.

 

The Company agrees, to the fullest extent that it may effectively do so under
applicable law, that a judgment in any suit, action or proceeding of the nature
referred to in the preceding paragraph brought in any such court shall be
conclusive and binding upon the Company, subject to rights of appeal and may be
enforced in the courts of the United States of America or the State of New York
(or any other court the jurisdiction to which the Company is or may be subject)
by a suit upon such judgment.

 

The Company irrevocably designates and appoints Assured Guaranty Corp. as its
authorized agent, upon which process may be served in any suit, action or
proceeding of the nature referred to in the second preceding paragraph by
mailing a copy thereof by registered or certified mail, postage prepaid, return
receipt requested, to the agent at 1325 Avenue of the

 

10

--------------------------------------------------------------------------------

 

Americas, New York, New York 10019.  The Company agrees that such service (i)
shall be deemed in every respect effective service of process upon it in every
suit, action or proceeding and (ii) shall, to the fullest extent permitted by
law, be taken and held to be valid personal service upon and personal delivery
to the Company.  Notices hereunder shall be conclusively presumed received as
evidenced by a delivery receipt furnished by the United States Postal Service or
any commercial delivery service. Nothing in this Section 16 shall affect the
right of the Indemnitee to serve process in any manner permitted by law, or
limit any right to bring proceedings against the Company in the courts of any
jurisdiction or to enforce in any lawful manner a judgment obtained in one
jurisdiction in any other jurisdiction.

 

17.  Notices. All notices, demands, and other communications required or
permitted hereunder shall be made in writing and shall be deemed to have been
duly given if delivered by hand, against receipt, or mailed, postage prepaid,
certified or registered mail, return receipt requested, and addressed to the
Company at:

 

Assured Guaranty Ltd.

30 Woodbourne Avenue

Hamilton HM08 Bermuda

Attention:   General Counsel

 

and to Indemnitee at:

 

Notice of change of address shall be effective only when given in accordance
with this Section. All notices complying with this Section shall be deemed to
have been received on the date of hand delivery or on the third business day
after mailing.

 

18.  Counterparts. This Agreement may be executed in one or more counterparts,
each of which shall be deemed an original, but all of which together shall
constitute one and the same instrument.

 

11

--------------------------------------------------------------------------------

 

IN WITNESS WHEREOF, the parties hereto have duly executed and delivered this
Agreement as of the day specified above.

 

 

ASSURED GUARANTY LTD.

 

 

 

 

 

By:

 

 

 

Its:

 

 

 

 

 

 

 

 

 

INDEMNITEE

 

 

 

 

 

 

 

 

 

 

 

Typed Name:

 

12

--------------------------------------------------------------------------------