Exhibit 10.1


 


ARCH CAPITAL GROUP LTD.

Restricted Share Agreement


 


THIS
AGREEMENT, dated as of April 1, 2009, between Arch Capital Group Ltd. (the
“Company”), a Bermuda company, and John C.R. Hele (the “Employee”).


 


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


 


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


 


1.                             Award
of Shares.  Pursuant to the provisions of the Plan, the terms of
which are incorporated herein by reference, the Employee is hereby awarded
25,000 Restricted Shares (the “Award”), subject to the terms and conditions
herein set forth.  Capitalized terms used
herein and not defined shall have the meanings set forth in the Plan.  In the event of any conflict between this
Agreement and the Plan, the Plan shall control.


 


2.                             Terms
and Conditions.  It is understood and agreed that the Award of Restricted
Shares evidenced hereby is subject to the following terms and conditions:


 


(a)                        Vesting
of Award.  Subject to Section 2(b) below
and the other terms and conditions of this Agreement, this Award shall become
vested in three equal annual installments on the first, second and third
anniversaries of the date hereof.  Unless
otherwise provided by the Company, all dividends and other amounts receivable
in connection with any adjustments to the Shares under Section 4(c) of
the Plan shall be subject to the vesting schedule in this Section 2(a).


 


(b)                       Termination
of Service; Forfeiture of Unvested Shares.


 


(i)      In the event the Employee
ceases to be an employee of the Company prior to the date the Restricted Shares
otherwise become vested due to his or her death or Permanent Disability (as
defined in the Employment Agreement, dated as of October 22, 2008, between
the Employee and the Company, the “Employment Agreement”), the Restricted
Shares shall become immediately vested in full upon such termination of
employment.


 


(ii)     In the event of
termination of employment (other than by the Company for Cause, as such term is
defined in the Employment Agreement) after the attainment of Retirement Age (as
defined in the Company’s Incentive Compensation Plan on the date hereof), the
Restricted Shares shall continue to vest on the schedule set forth in Section 2(a) above
so long as the Employee does not engage in any activity in competition with any
activity of the


 

















 


Company or any of its
Subsidiaries other than serving on the board of directors (or similar governing
body) of another company or as a consultant for no more than 26 weeks per
calendar year (“Competitive Activity”). 
In the event the Employee engages in a Competitive Activity, any
unvested Restricted Shares shall be forfeited by the Employee and become the
property of the Company.


 


(iii)    In the event the Employee
ceases to be an employee of the Company due to termination (A) by the
Company not for Cause or (B) by the Employee for Good Reason (as defined
in the Employment Agreement), the Restricted Shares, to the extent not already
vested, shall become immediately vested in full upon such termination of
employment.


 


(iv)    If the Employee ceases to
be an Employee of the Company for any other reason prior to the date the
Restricted Shares become vested, the Award shall be forfeited by the Employee
and become the property of the Company; provided that, in the event of a
Redundancy (as defined below), the Committee, in its sole discretion, may, in
accordance with its authority under the Plan, determine that the Restricted
Shares, to the extent not vested, shall become vested upon such termination of
employment.


 


(v)     For purposes of this
Agreement, service with any of the Company’s Subsidiaries (as defined in the
Plan) shall be considered to be service with the Company.


 


(vi)    “Redundancy”
shall mean termination of employment by the Company due to its need to reduce
the size of its workforce, including due to closure of a business or a
particular workplace or change in business process.  Whether a termination
of employment is due to a “redundancy” shall be determined by the Committee in
its sole and absolute discretion, such determination being final and binding on
all parties hereto and all persons claiming through, in the name of or on
behalf of such parties.


 


(c)                        Certificates.  Each
certificate issued in respect of Restricted Shares awarded hereunder shall be deposited
with the Company, or its designee, together with, if requested by the Company,
a stock power executed in blank by the Employee, and shall bear a legend
disclosing the restrictions on transferability imposed on such Restricted
Shares by this Agreement (the “Restrictive Legend”).  Upon the vesting of Restricted Shares
pursuant to Section 2 hereof and the satisfaction of any withholding tax
liability pursuant to Section 5 hereof, the certificates evidencing such
vested Shares, not bearing the Restrictive Legend, shall be delivered to the
Employee.


 


(d)                       Rights
of a Stockholder.  Prior to the time a Restricted Share is fully
vested hereunder, the Employee shall have no right to transfer, pledge,
hypothecate or 


 


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otherwise encumber such Restricted Share.  During such period, the Employee shall have
all other rights of a stockholder, including, but not limited to, the right to
vote and to receive dividends (subject to Section 2(a) hereof) at the
time paid on such Restricted Shares.


 


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


 


3.                             Transfer
of Shares.  The Shares delivered
hereunder, or any interest therein, may be sold, assigned, pledged, hypothecated,
encumbered, or transferred or disposed of in any other manner, in whole or in
part, only in compliance with the terms, conditions and restrictions as set
forth in the governing instruments of the Company, applicable United States
federal and state securities laws or any other applicable laws or regulations
and the terms and conditions hereof.


 


4.                             Expenses
of Issuance of Shares.  The issuance
of stock certificates hereunder shall be without charge to the Employee.  The Company shall pay any issuance, stamp or
documentary taxes (other than transfer taxes) or charges imposed by any governmental
body, agency or official (other than income taxes) or by reason of the issuance
of Shares.


 


5.                             Withholding.  No later than the date of vesting of (or the
date of an election by the Employee under Section 83(b) of the Code
with respect to) the Award granted hereunder, the Employee shall pay to the
Company or make arrangements satisfactory to the Committee regarding payment of
any federal, state or local taxes of any kind required by law to be withheld
with respect to such Award and the Company shall, to the extent permitted or
required by law, have the right to deduct from any payment of any kind otherwise
due to the Employee, federal, state and local taxes of any kind required by law
to be withheld.


 


6.                             References.  References
herein to rights and obligations of the Employee shall apply, where
appropriate, to the Employee’s legal representative or estate without regard to
whether specific reference to such legal representative or estate is contained
in a particular provision of this Agreement.


 


7.                             Notices.  Any
notice required or permitted to be given under this Agreement shall be in
writing and shall be deemed to have been given when delivered personally or by courier,
or sent by certified or registered mail, postage prepaid, return receipt requested,
duly addressed to the party concerned at the address indicated below or to such
changed address as such party may subsequently by similar process give notice
of:


 


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If to the
Company:


 


Arch
Capital Group Ltd.

Wessex House, 4th Floor


45 Reid Street

Hamilton HM 12 Bermuda 

Attn.: Secretary


 


If to the
Employee:


 


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


 


8.                             Governing
Law.  This Agreement shall be governed by and construed in
accordance with the laws of New York, without giving effect to principles of
conflict of laws.


 


9.                             Entire
Agreement.  This Agreement and the
Plan constitute the entire agreement among the parties relating to the subject
matter hereof, and any previous agreement or understanding among the parties
with respect thereto is superseded by this Agreement and the Plan.


 


10.                       Counterparts.  This
Agreement may be executed in two counterparts, each of which shall constitute
one and the same instrument.


 


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


 


	
   

  	
  ARCH CAPITAL GROUP LTD.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Dawna Ferguson

  
	
   

  	
   

  	
  Name: Dawna Ferguson

  
	
   

  	
   

  	
  Title: Secretary

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ John C. R. Hele

  
	
   

  	
  John C.R. Hele

  



 


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