Exhibit 10.2


 


CONFORMED COPY


 


 


 


ASSURED GUARANTY LTD.

SUPPLEMENTAL EMPLOYEE RETIREMENT PLAN


 


(Effective April 28,
2004, and as further amended through the Second Amendment)


 


Mayer, Brown, Rowe &
Maw, LLP


 


 


 





















 


 


ASSURED GUARANTY LTD.
SUPPLEMENTAL EMPLOYEE RETIREMENT PLAN


 


CERTIFICATE


 


 


I, James M. Michener, General Counsel and Secretary of
Assured Guaranty Ltd., hereby certify that the attached document is a full,
true and complete copy of the Assured Guaranty Ltd. Supplemental Employee
Retirement Plan as in effect on April 28, 2004.


 


Dated this     day of             ,
2004.


 


	
   

  	
  General and Secretary
  as Aforesaid

  
	
   

  	
  (Seal)

  



 


 





















 


TABLE
OF CONTENT


 


	
   

  	
   

  	
  Page

  
	
  SECTION 1

  	
  GENERAL

  	
  1

  
	
   

  	
   

  	
   

  
	
  1.1.

  	
  Purpose and
  Effective Date

  	
  1

  
	
   

  	
   

  	
   

  
	
  1.2.

  	
  Employers
  and Related Companies

  	
  1

  
	
   

  	
   

  	
   

  
	
  1.3.

  	
  Plan Administration

  	
  1

  
	
   

  	
   

  	
   

  
	
  1.4.

  	
  Applicable Laws

  	
  2

  
	
   

  	
   

  	
   

  
	
  1.5.

  	
  Gender and Number

  	
  2

  
	
   

  	
   

  	
   

  
	
  1.6.

  	
  Plan
  Year

  	
  2

  
	
   

  	
   

  	
   

  
	
  1.7. 

  	
  Notices
  

  	
  2 

  
	
   

  	
   

  	
   

  
	
  1.8.

  	
  Form and Time of
  Elections

  	
  2

  
	
   

  	
   

  	
   

  
	
  1.9.

  	
  Evidence

  	
  2

  
	
   

  	
   

  	
   

  
	
  1.10.

  	
  Action by Employers

  	
  2

  
	
   

  	
   

  	
   

  
	
  1.11.

  	
  Limitations on
  Provisions

  	
  2

  
	
   

  	
   

  	
   

  
	
  1.12. 

  	
  Assignment
  and Alienation; Forfeitures 

  	
  2 

  
	
   

  	
   

  	
   

  
	
  SECTION 2

  	
  PARTICIPATION

  	
  3

  
	
   

  	
   

  	
   

  
	
  2.1.

  	
  Participation

  	
  3

  
	
   

  	
   

  	
   

  
	
  2.2.

  	
  Plan Not
  Contract of Employment

  	
  3

  
	
   

  	
   

  	
   

  
	
  SECTION 3

  	
  AMOUNT
  AND PAYMENT OF PLAN BENEFIT

  	
  3

  
	
   

  	
   

  	
   

  
	
  3.1.

  	
  Accounts

  	
  3

  
	
   

  	
   

  	
   

  
	
  3.2.

  	
  Adjustment of
  Accounts

  	
  6

  
	
   

  	
   

  	
   

  
	
  3.3.

  	
  Investment Return
  Rates

  	
  6

  
	
   

  	
   

  	
   

  
	
  3.4.

  	
  Participant
  Selection of Investment Return Rate

  	
  6

  
	
   

  	
   

  	
   

  
	
  3.5.

  	
  Statement of
  Accounts

  	
  6

  
	
   

  	
   

  	
   

  
	
  3.6.

  	
  Distribution

  	
  6

  
	
   

  	
   

  	
   

  
	
  3.7.

  	
  Distributions
  to Persons Under Disability

  	
  7

  
	
   

  	
   

  	
   

  
	
  3.8.

  	
  Forfeiture
  of Certain Accounts

  	
  7

  
	
   

  	
   

  	
   

  
	
  3.9.

  	
  Transfers
  from ACE Limited Supplemental Retirement Plan

  	
  7

  
	
   

  	
   

  	
   

  
	
  SECTION 4

  	
  SOURCE OF
  BENEFIT PAYMENTS

  	
  8

  
	
   

  	
   

  	
   

  
	
  4.1.

  	
  Liability
  for Benefit Payments

  	
  8

  
	
   

  	
   

  	
   

  
	
  4.2.

  	
  No
  Guarantee

  	
  8

  
	
   

  	
   

  	
   

  
	
  4.3.

  	
  Successors

  	
  8

  
	
   

  	
   

  	
   

  
	
  SECTION 5

  	
  AMENDMENT
  AND TERMINATION

  	
  8

  
	
   

  	
   

  	
   

  
	
  EXHIBIT A

  	
  DISTRIBUTION
  RULES AND REGULATIONS

  	
  10

  



 


 


 





















ASSURED GUARANTY LTD.

SUPPLEMENTAL EMPLOYEE RETIREMENT  PLAN


SECTION 1


General


1.1.          Purpose and Effective Date.  Assured Guaranty Ltd. (the “Company”) has
established the Assured Guaranty Ltd. Employee Retirement Plan (the “Retirement
Plan”) to provide retirement income for its eligible employees and the eligible
employees of each Related Company (as defined in section 1.2) which, with the
consent of the Company, adopts the Plan. 
Contrary to the desire of the Company, the amount of contributions which
may be made to the retirement plan for the benefit of an employee may be
limited by reason of the application of certain provisions of the Internal
Revenue Code of 1986 of the United States of America, as amended (the “Code”).
The Company has established the Assured Guaranty Ltd. Supplemental Employee
Retirement (the ‘Plan’) to assure that affected individuals will receive
benefits in amounts comparable to the amounts that they would have received
under the Retirement Plan if such limitations of the Code did not apply to the
Retirement Plan.  The Plan also allows
for additional contributions to  provide
additional retirement security for the participants.  The Plan is effective April 28, 2004 (the “Effective
Date”).


1.2.          Employers and Related Companies.  The term “Related Company” means any
corporation or trade or business during any period during which it is, along
with the Company, a member of a controlled group of corporations or a
controlled group of trades or businesses, as described in sections 414(b) and 414(c),
respectively, of the Code.  The Company
and each Related Company, which, with the Company’s consent, adopts the Plan
are referred to below collectively as the “Employers” and individually as an “Employer”.


1.3.          Plan
Administration.  The authority to
control and manage the operation and administration of the Plan shall be vested
in the Committee appointed by the Company to act under the Retirement Plan;
provided, however, that payment of any benefits to, or on behalf of
Participants pursuant to Section 3 may be made at the direction of any two of
the following officers of the Company: 
(a) Chief Executive Officer (b) Chief Financial Officer, or (c) General
Counsel.  In controlling and managing the
operation and administration of the Plan, the Committee shall have the same
rights, powers and duties as those delegated to it under the Retirement Plan,
which includes full and discretionary power and authority to interpret and
construe the provisions of the Plan and to determine the amount of benefits and
the rights or eligibility of employees or Participants (as defined in
subsection 2.1) under the Plan, and such other power and authority as may be
necessary to discharge its duties hereunder. 
Any interpretation of the Plan and any decision made by the Committee on
any matter within the discretion of the Committee shall be binding on all
persons.  A misstatement or other mistake
of fact shall be corrected when it becomes known, and the Committee shall make
such adjustment on account thereof as it considers equitable and
practicable.  The Committee may delegate
such of its ministerial or discretionary duties and functions as it may deem
appropriate to any employee or group of employees of any Employer.


 


1





















 


1.4.          Applicable
Laws.  The Plan shall be construed
and administered in accordance with the laws of Bermuda.


1.5.          Gender
and Number.  Where the context
admits, words in any gender shall include any other gender, words in the
singular shall include the plural and the plural shall include the singular.


1.6.          Plan
Year.  The “Plan Year” shall be the
twelve-consecutive month period beginning on each January 1. The first Plan
Year shall be a short Plan Year beginning on the Effective Date and ending on
December 31, 2004.


1.7.          Notices.  Any notice or document required to be filed
with the Committee under the Plan will be properly filed if delivered or mailed
by registered mail, postage prepaid, to the Committee, in care of the Company,
at its principal executive offices.  Any
notice required under the Plan may be waived by the person entitled to notice.


1.8.          Form and Time of Elections.  Unless otherwise specified herein or as
otherwise permitted by the Committee, any election or consent permitted or
required to be made or given by any Participant or other person entitled to
benefits under the Plan, and any permitted modification or revocation thereof,
shall be made in writing to the Committee


1.9.          Evidence.  Evidence required of anyone under the Plan
may be by certificate, affidavit, document or other information which the
person acting on it considers pertinent and reliable, and signed, made or
presented by the proper party or parties.


1.10.        Action
by Employers.  Any action required or
permitted to be taken under the Plan by any Employer which is a corporation
shall be by resolution of its Board of Directors, or by a person or persons
authorized by its Board of Directors. 
Any action required or permitted to be taken by any Employer which is a
partnership shall be by a general partner of such partnership or by a duly
authorized officer thereof.


1.11.        Limitations on Provisions.  The provisions of the Plan and any benefits
payable hereunder shall be limited as described herein.  Any benefit payable under the Retirement
Plans shall be paid solely in accordance with the terms and conditions of the
applicable Retirement Plan and nothing in this Plan shall operate or be
construed in any way to modify, amend, or affect the terms and provisions of
the Retirement Plans.


1.12.        Assignment and Alienation;
Forfeitures.  The benefits payable to
any Participant or Beneficiary under the Plan may not be voluntarily or
involuntarily pledged, assigned, alienated, transferred or otherwise
anticipated.  In the event a Participant
or Beneficiary attempts to do so, any amount that is subject to the purported
pledge, assignment, alienation, transfer or other anticipation shall be
immediately forfeited and neither the Participant nor his Beneficiary shall
have any further rights to such benefits.


 


2





















 


SECTION 2


Participation


2.1.          Participation.  Each employee of an Employer shall become a “Participant”
as of the earlier of the date on which he becomes a participant in the
Retirement Plan or the date on which he is designated as a Participant by the
Committee.  Once an eligible employee
becomes a Participant in the Plan, as long as he continues to have an Account
balance under the Plan he will remain a Participant for all purposes under the
Plan, except for purposes of the contribution provisions of Section 3.


2.2.          Plan Not Contract of Employment.  The Plan does not constitute a contract of
employment, and participation in the Plan will not give any employee the right
to be retained in the employ of the Company nor any right or claim to any
benefit under the Plan, unless such right or claim has specifically accrued
under the terms of the Plan.


SECTION 3


Amount and Payment
of Plan Benefit


3.1.          Accounts.  The Committee shall maintain “Supplemental
Accounts” in the name of each Participant under the Plan which will reflect the
amount, expressed in United States dollars, to which the Participant may become
entitled under the Plan.  A Participant’s
Supplemental Accounts shall be credited in each Plan Year as follows:


(a)                                  For any Plan Year, in the event the
Participant’s before-tax elective contributions to the Retirement Plan are
limited by the provisions of sections 401(a)(17), 401(k)(3), 402(g) or 415 of
the Code, as applicable, his compensation for the Plan Year will continue to be
reduced by, and the Participant’s Supplemental Before-Tax Account credited
with, an amount equal to the amount of before-tax elective contributions that
would have been made under the Retirement Plan had the provisions of sections
401(a)(17), 401(k)(3), 402(g) or 415 of the Code, as applicable, not applied to
him; provided, however, that such continuing before-tax elective contributions
to this Plan shall be made pursuant to an election made by the Participant
prior to the beginning of the Plan Year (or with respect to a newly-eligible
Participant, within 30 days of first becoming eligible to participate, which
election shall apply only to compensation payable after the date of such
election), which election shall indicate the percentage of compensation to be
contributed to this Plan after before-tax elective contributions to the
Retirement Plan have been limited under sections 401(a)(17), 401(k)(3), 402(g)
or 415 of the Code.  Such election with
respect to the Plan shall be irrevocable, except that the Participant may elect
to stop such contributions, in which case no additional amounts shall be
credited for that Plan Year to the Participant’s Supplemental Before-Tax
Account or Supplemental Matching Account. 
Credits to the Participant’s Supplemental Before-Tax Account pursuant to
this subsection 3.1(a) shall be made at the same time that before-tax elective
contributions would otherwise have been credited to


 


3





















 


his accounts under the
Retirement Plan.  Notwithstanding the
foregoing provisions of this subsection 3.1(a), salary reductions shall
continue and an amount shall be credited to the Participant’s Supplemental
Before-Tax Account in accordance with this subsection 3.1 (a) (and Supplemental
Matching Contributions and Discretionary Matching Contributions, if any, shall
be credited to the Participant’s applicable accounts in accordance with
subsections 3.1(b) and 3.1(c)) for a Plan Year only if the Participant’s
before-tax elective contributions to the Retirement Plan have reached the
maximum amount permitted under section 402(g) of the Code or the maximum
elective contributions permitted under the Plan, in accordance with Treas. Reg.
section 1.401(k)(1)(e)(6)(iv); and the Committee shall establish such other
administrative procedures as are necessary to comply with such regulations.


(b)                                 Subject to the requirements of subsection
3.1(a), for any Plan Year, a Participant’s Supplemental Matching Account shall
be credited with an amount equal to the difference, if any, between (a) the
matching contributions that would have been contributed on behalf of the
Participant to the Retirement Plan for that Plan Year, in accordance with the
terms thereof and based on his before-tax elective contributions under the
Retirement Plan (and this Plan), determined without regard to the limitations
of sections 401(a)(17), 401(k)(3), 401(m), 402(g) or 415 of the Code, and (b)
the amount of matching contributions actually made to the Retirement Plan on
behalf of the Participant.  Credits to
the Participant’s Supplemental Matching Account pursuant to this subsection
3.1(b) shall be made at the same time that matching contributions would
otherwise have been credited to his accounts under the Retirement Plan.


(c)                                  A Participant’s “Discretionary Matching
Contribution Account” shall be credited 
for a Plan Year in the amount, if any, determined by the Company in its
sole discretion, on behalf of each Participant who has made a before-tax
elective contribution to the Retirement Plan for such Plan Year and who is
employed by an Employer on the last day of that year, and with respect to whom
before-tax contributions to the Retirement Plan have been limited for such Plan
Year as a result of the application of sections 401(a)(17), 401(k)(3), 401(m),
402(g) or 415 of the Code.  Such
Discretionary Matching Contribution shall be expressed as a percentage of the
before-tax elective contribution made by the Employer on behalf of such
Participant for that Plan Year to the Retirement Plan and, in addition, the
additional amounts of before-tax elective contributions credited to the
Participant’s Supplemental Before-Tax Account, if any, under subsection 3.1(a)
of the Plan; provided, however, that the Discretionary Matching Contribution
with respect to any Plan Year shall not exceed fifty percent of that portion of
the sum of the Participant’s before-tax 
elective contribution to the Retirement Plan and the Participant’s
before-tax elective contribution to this Plan which does not exceed six percent
(one percent with respect to a Participant who is also an active participant in
the Assured Guaranty Bermuda Pension Plan, as 


 


4





















 


defined in the Retirement
Plan) of the Participant’s compensation (as defined in the Retirement Plan, but
disregarding the limitations therein) for that Plan Year.


(d)                                 For any Plan Year, a Participant’s
Supplemental Core Account shall be credited with an amount equal to the
difference, if any, between (a) the Employer Core Contribution that would have
been contributed on behalf of the Participant to the Retirement Plan for that
Plan Year, in accordance with the terms thereof determined without regard to
the limitations of sections 401(a)(17) or 415 of the Code and (b) the amount of
the Employer Core Contributions actually made to the Retirement Plan on behalf
of the Participant.  Credits to the
Participant’s Supplemental Core Account pursuant to this subsection 3.1(d)
shall be made at the same time that Employer Core Contributions would otherwise
have been credited to his accounts under the Retirement Plan.


(e)                                  For any Plan Year, a Participant’s
Supplemental Core Account may be credited with an additional amount, as
determined by the Company in its sole discretion, which amount, if any, shall
be allocated to the accounts of that group of Participants designated by the
Company it its sole discretion.  Such “Discretionary
Core Contribution” shall be allocated to the accounts of such designated
Participants in an amount equal to a percentage of each such Participant’s
compensation for the Plan Year.  Credits
to the Participant’s Supplemental Core Account of a Discretionary Core
Contribution pursuant to this subsection 3.1(e) shall be made as soon as
practicable following the Company’s determination to credit such Discretionary
Core Contribution.


(f)                                    Pursuant to and in accordance with Notice
2005-1 issued by the U.S. Treasury Department and the Internal Revenue Service,
each Participant who is eligible to make an election with respect to continuing
before-tax contributions, as described in paragraph (a) of this subsection 3.1,
for the 2005 Plan Year shall be given the opportunity to elect to make or
change his before-tax contribution election with respect to compensation
(including bonus amounts, if any, that are earned in 2005 but payable in 2006)
which is taken into account under the Plan after the before-tax contributions
to the Retirement Plan have been limited, by filing a written election form
delivered to the Committee or its designee no later than March 15, 2005.  Such election shall apply only to
compensation that has not been paid or become payable at the time the
Participant executes and delivers such election to the Committee or its
designee.  If a Participant does not file
an election form as permitted under this paragraph (f), then the election filed
by the Participant on or before December 31, 2005 shall continue to apply to
compensation taken into account under the Plan that is earned in 2005 and,
except as described in the immediately following sentence, thereafter.  The election with respect to compensation
earned in 2005 shall be irrevocable after March 15, 2005 and shall continue in
effect with respect to compensation earned after 2005 unless and until the
Participant changes the election in accordance with the requirements of section
409A of the Code and the terms of the Plan.


 


5





















 


3.2.          Adjustment
of Accounts.  Each Participant’s
Accounts shall be adjusted in accordance with this Section 3 in a uniform
manner as of each Valuation Date, as follows:


(a)                                  first, charge to the Account balance the
amount of any distributions under the Plan with respect to that Account that
have not previously been charged;


(b)                                 then, adjust the Account balance for the
applicable Investment Return Rate(s); and


(c)                                  then, credit to the Account balance the
amount to be credited to that Account in accordance with subsections 3.1 that
have not previously been credited.


Except as otherwise designated by the Committee, the
term “Valuation Date” means the last day of each calendar quarter.


3.3.          Investment Return Rates.  The “Investment Return Rate(s)” with respect
to the Account(s), or portions of the Supplemental Account(s), of any
Participant for any period shall be the Investment Return Rate(s) elected by
the individual in accordance with subsection 3.4 from among such investment
alternatives (if any) for that period which, in the discretion of the
Committee, are offered from time to time under this paragraph 3.3.


3.4.          Participant Selection of Investment
Return Rate.  The Investment Return
Rate alternatives under the Plan, and a Participant’s ability to choose among
Investment Return Rate alternatives, shall be determined in accordance with
rules established by the Committee from time to time; provided, however, that
the Company may not modify the Investment Return Rate with respect to periods
prior to the adoption of such modification.


3.5.          Statement
of Accounts.  As soon as practicable
after the last day of each Plan Year, the Committee will cause to be delivered
to each Participant a statement of the balance of his Supplemental Account as
of that day.


3.6.          Distribution.  Subject to the following provisions of this
subsection 3.6 and subsection 3.8, a Participant’s Supplemental Account balance
shall be payable to the Participant in accordance with the rules and
regulations set forth in Exhibit A, which forms part of the Plan, and in
accordance with such other restrictions and limitations imposed by the
Committee and applicable law.  Subject to
any applicable currency exchange laws, payments shall be made in such currency
as the Committee shall elect, based on the currency exchange rate of the
Trustee of the Retirement Plan as of the date of payment.  In the event of a Participant’s death, the
amount which would otherwise be payable to the Participant shall be paid to one
or more beneficiaries designated by the Participant for purposes of the Plan in
a writing filed with the Committee prior to the date of death.  Any such designation shall cancel any
previous designation by the Participant. 
If no such designation is on file on the date of the Participant’s
death, or if the designated beneficiary predeceases the Participant, the
Participant’s Supplemental Account balance shall be paid to the Participant’s
estate.


 


6





















 


3.7.          Distributions to Persons Under
Disability.  In the event a
Participant or his beneficiary is declared incompetent and an conservator or
other person legally charged with the care of his person or of his estate is
appointed, any benefit to which such Participant or beneficiary is entitled
under the Plan shall be paid to such conservator or other person legally
charged with the care of his person or of his estate.


3.8.          Forfeiture of Certain Accounts.  Notwithstanding any provision of the Plan to
the contrary, in no event shall any amount attributable to the Participant’s
Supplemental Matching Account, Supplemental Discretionary Matching Account, and
Supplemental Core Account be payable to or on account of a Participant whose
Termination Date occurs prior to the Participant’s completion of twelve
consecutive months of employment with an Employer for any reason other than the
death of the Participant or if the Participant attains age 65; provided,
however, for purposes of this sentence, each Participant who was an employee of
ACE Limited or a subsidiary of ACE Limited immediately prior to the Effective
Date and who became an employee of an Employer in connection with the initial
public offering of shares of Assured Guaranty Ltd shall be credited with twelve
consecutive months of service of employment with the Employers on the later of
the Effective Date or the first date on which he is employed by an Employer.  A Participant’s “Termination Date” will be
the date on which his employment by the Employer and the Related Companies is
terminated for any reason.


3.9.          Transfers from ACE Limited
Supplemental Retirement Plan.  Each
employee of an Employer who satisfies the following conditions shall have an
Account established on his behalf under the Plan, and such Account shall be
credited with an amount reflecting amounts attributable to such individual’s
participation in the ACE Limited Supplemental Retirement Plan:


(a)                                  the Participant was an employee of ACE
Limited or a subsidiary of ACE Limited immediately prior to the Effective Date;


(b)                                 the Participant became an employee of an
Employer in connection with the initial public offering of shares of the
Company; and


(c)                                  the Participant was a participant in the
ACE Limited Supplemental Retirement Plan.


An employee of an Employer who satisfies the foregoing conditions shall
become a Participant in the Plan in accordance with the terms and conditions of
the Plan.  If an employee of an Employer
is not otherwise eligible to participate in the Plan, he shall be treated as a
Participant only with respect to amounts credited to his Accounts which are
attributable to the obligations assumed by his Employer from the ACE Limited
Supplemental Retirement Plan until such employee has met the requirements for
participation in the Plan. The Accounts of each Participant under the Plan,
including any portion of an Account transferred pursuant to this subsection
3.9, shall be subject to the terms of the Plan, including, but not limited to,
the terms relating to Investment Return Rates and the restrictions regarding
the forms and time of payment; and the portion of a Participant’s Account
balances which is attributable to amounts transferred pursuant to this
subsection 3.9 shall be payable from the Plan only after the date on which the
Participant is otherwise eligible for a distribution from the Plan.


 


7





















 


SECTION 4


Source of Benefit
Payments


4.1.          Liability for Benefit Payments.  The amount of any benefit payable under the
Plan shall be paid from the general revenues of the Employer of the Participant
with respect to whom the benefit is payable; provided, however, that if a
Participant has been employed by more than one Employer, the portion of his
Plan benefits payable by any such Employer shall be that portion accrued while
the Participant was employed by that Employer, and earnings on such portion;
and provided further, that if any portion of a Participant’s Plan benefit is
attributable to amounts transferred to the Plan pursuant to section 3.9 of the
Plan, that portion of the Participant’s benefit attributable to such
transferred amounts, and earnings on such portion, shall be payable by the
Employer that assumed the obligation to pay such transferred benefit to the
Participant.  An Employer’s obligation
under the Plan shall be reduced to the extent that any amounts due under the
Plan are paid from one or more trusts, the assets of which are subject to the
claims of general creditors of the Employer or any affiliate thereof; provided,
however, that nothing in the Plan shall require the Company or any Employer to
establish any trust to provide benefits under the Plan.


4.2.          No
Guarantee.  Neither a Participant nor
any other person shall, by reason of the Plan, acquire any right in or title to
any assets, funds or property of the Employers whatsoever, including, without
limitation, any specific funds, assets, or other property which the Employers,
in their sole discretion, may set aside in anticipation of a liability under
the Plan.  A Participant shall have only
a contractual right to the amounts, if any, payable under the Plan, unsecured
by any assets of the Employers.  Nothing
contained in the Plan shall constitute a guarantee by any of the Employers that
the assets of the Employers shall be sufficient to pay any benefits to any
person.


4.3.          Successors.  The obligations of the Company and each
Employer under the Plan shall be binding on any assignee or successor in
interest thereto.  Prior to any merger,
consolidation or sale of assets, the Company, or if applicable, the Employer,
shall require any such successor to expressly assume all of the Company’s, or
if applicable, all of the Employer’s, obligations under the Plan.


SECTION 5


Amendment and
Termination


The Company may, at any time, amend or terminate the
Plan; provided, however, that subject to the provisions of the following
sentence, neither an amendment nor a termination shall adversely affect the rights
of any Participant to benefits credited to a Participant’s account under the
Plan as of the date immediately prior to the date of the amendment or
termination (but subject to losses and earning allocable to such account after
the date of the amendment or termination) without the consent of the
Participant.  The Company, by Plan
amendment or termination, may prospectively eliminate the right to have amounts
credited to any Supplemental Account pursuant to the provisions of subsection
3.1 or subsection 3.3, or reduce the amount which is required to be credited to
any such account pursuant to those provisions.


 


8





















 


Exhibit A


ASSURED GUARANTY LTD.
SUPPLEMENTAL EMPLOYEE RETIREMENT PLAN


 


Distribution Rules and
Regulations


 


Subject to such restrictions and limitations imposed
by the Committee, the following rules and regulations shall apply to the
distribution of a Participant’s Supplemental Account balances:


 


1.             If the amount of
the Participant’s Supplemental Account balances is less than $60,000 as of the
Valuation Date coincident with or immediately prior to the date such
Participant terminates employment with the Employers and the Related Companies,
then the payment of the Participant’s Supplemental Account balances shall begin
on the same date that such Participant’s account balances under the Retirement
Plan are paid to him.  The amount of the
Participant’s Supplemental Account balances to be paid to the Participant shall
be determined as of the Valuation Date coincident with or immediately prior to
the date on which payment is made.


 


2.             If the amount of
the Participant’s Supplemental Account balances is equal to or greater than
$60,000 as of the Valuation Date coincident with or immediately prior to the
date such Participant terminates employment with the Employers and the Related
Companies, then payment of the Participant’s Supplemental Account balances
shall begin on the Participant’s “Benefit Commencement Date.”  The amount of the Participant’s Supplemental
Account balances to be paid to the Participant shall be determined for as of
the Valuation Date coincident with or immediately prior to the date on which
payment is made.  For purposes of these
rules and regulations, “Benefit Commencement Date” means, in the case of a
Participant who terminates employment prior to attainment of age 55, the first
day of the month coinciding with or next following his 55th birthday; and in
the case of a Participant who terminates employment on or after his 55th
birthday, or because of death or disability, the first day of the month
coinciding with or next following his termination of employment.


 


3.             A Participant shall
file an election with the Committee indicating the form in which payment of the
Participant’s Supplemental Account Balances shall be made; provided, however,
that such form must be either a single lump sum or installments payable over a
period not exceeding the life expectancy of the Participant or the joint life
expectancy of the Participant and his beneficiary designated in accordance with
subsection 3.6 of the Plan.  Such
election must be filed with the Committee at least one year and one day in
advance of the date on which such Participant’s Supplemental Account balances
become payable to the Participant, and if a valid election has not been so
filed with the Committee, then payment of the Participant’s Supplemental
Account balances shall be delayed until the date that is one year and one day
after the date on which such election form was filed, or in the sole discretion
of the Committee, shall be paid in a single lump sum as soon as practicable
following the Participant’s termination of employment.


 


 


9