Exhibit
10.1


 


 


 


 


 


 


 


 


 


 


 


 


Assured
Guaranty Corp.


 


Supplemental
Executive Retirement Plan


 


Highlights
Booklet - 2006 Plan Year


 


December
2005


 


 


 


 


 


 


 


 


 


 





















 


Assured Guaranty Corp.


Supplemental Executive Retirement Plan


 


Table of Contents


 


	
  1.

  	
  Introduction

  	
  1

  
	
   

  	
  Need for Supplemental Benefits

  	
  1

  
	
   

  	
  Nonqualified
  Status of the Plan

  	
  1

  
	
   

  	
   

  	
   

  
	
  2.

  	
  Overview

  	
  1

  
	
   

  	
   

  	
   

  
	
  3.

  	
  Types
  of Contributions

  	
  1

  
	
   

  	
  Employee Elective Deferrals

  	
  1

  
	
   

  	
  Employer Matching Contributions

  	
  1

  
	
   

  	
  Employer Core
  Retirement Contribution

  	
  1

  
	
   

  	
  Vesting

  	
  1

  
	
   

  	
  FICA Taxation

  	
  1

  
	
   

  	
   

  	
   

  
	
  4.

  	
  Plan Benefits

  	
  1

  
	
   

  	
   

  	
   

  
	
  5.

  	
  Investment Options

  	
  1

  
	
   

  	
  Investment Measurement Option Choices

  	
  1

  
	
   

  	
  Transfer
  Options

  	
  1

  
	
   

  	
  Participant Information and Web Access

  	
  1

  
	
   

  	
   

  	
   

  
	
  6.

  	
  Distributions

  	
  1

  
	
   

  	
  General
  Rules

  	
  1

  
	
   

  	
  Distribution
  Events

  	
  1

  
	
   

  	
  Retirement

  	
  1

  
	
   

  	
  Separation
  from Service

  	
  1

  
	
   

  	
  Distributions to Specified Employees

  	
  1

  
	
   

  	
  Redeferral
  Election

  	
  1

  
	
   

  	
  Loans
  Not Permitted

  	
  1

  
	
   

  	
  Income
  Taxation

  	
  1

  
	
   

  	
   

  	
   

  
	
  7.

  	
  Plan Administration

  	
  1

  
	
   

  	
  Plan
  Administrator

  	
  1

  
	
   

  	
  Claims
  Review

  	
  1

  
	
   

  	
  Plan
  Documentation

  	
  1

  
	
   

  	
  Plan Amendment or Termination

  	
  1

  



 


 





















 


This program is governed by the Assured Guaranty
Corp. Supplemental Executive Retirement Plan Document.  If any provisions of this booklet contradict
the Plan document, the Plan document provisions prevail.


 


The American Jobs Creation Act of 2004 added Section 409A to the
Internal Revenue Code;   Section 409A
governs Supplemental Executive Retirement Plans.  The Treasury and Internal Revenue Service
(IRS) issued regulations on Section 409A on September 29, 2005 that provided
guidance as to the application of the rules of Section 409A.  This Plan will be operated in good faith
compliance with these rules; however, as some rules are not applicable until
the end of December 31, 2006, the information contained in this booklet is
subject to change based on interpretation of these rules and any further
guidance.


 


Following is a summary of the
plan.  The Company retains the right to
interpret the plan and also reserves the right to amend or terminate the plan
at any time, subject to applicable law.


 


 





















 


1.             Introduction


 


Need for Supplemental Benefits


The Federal government limits the amount of money that a highly
compensated employee can save for retirement in a tax qualified retirement
plan.  The amount of compensation that
may be considered for purposes of a qualified plan is limited to a stated
dollar amount that is set each year by the government (the limit for 2006 is
$220,000).  In addition, the maximum you
will be able to defer for 2006 is $15,000 and depending upon the results of
nondiscrimination testing in the retirement plan, this $15,000 may be further
reduced.  (Note, if you have reached age
50 and you take advantage of the catch-up provisions in the qualified plan, you
may defer an additional $5,000.)


 


Assured Guaranty Corp. (company) has recognized the special needs of
its executives and provides this nonqualified deferred compensation program for
the benefit of its key employees.


 


The various types of contributions and accounts are described in this
booklet.  Enrollment forms and related
material are contained in the enrollment package.


 


Nonqualified Status of the Plan


This Assured Guaranty Corp. Supplemental Executive Retirement Plan
(Plan) is a nonqualified executive deferred compensation arrangement.  Nonqualified means that the Plan is not
subject to ERISA’s antidiscrimination and minimum funding requirements, nor is
it qualified under the Internal Revenue Code Section 401(a), et. seq.  The Plan must meet certain requirements in
order to avoid current federal income taxation for participants:


 


•                                          The Plan must comply with Internal
Revenue Code (IRC) Section 409A and related guidance and regulations;


 


•                                          Participation must be limited to a “select
group of management or highly compensated employees;” and


 


•                                          Your deferrals and company contributions
must remain as employer assets, subject to the claims of the employer’s general
creditors in the event of bankruptcy or forced liquidation.


 


 


1





















 


2.             Overview


 


The Assured Guaranty Corp. Supplemental Executive Retirement Plan
provides a comprehensive benefit package that allows you to address a variety
of personal financial objectives.


 


•                                          You may elect to defer up to 6% of your
cash compensation.


 


•                                          The company will match 100% of your
contribution up to 6% of you cash compensation.


 


•                                          The Company will also make a Core Retirement
Contribution to your account equal to 6% of that portion of your cash
compensation in excess of IRS limits applicable to the tax-qualified Retirement
Plan.


 


•                                          All contributions to the Plan are made on
a pretax basis for federal and state income tax purposes.


 


•                                          Contributions allocated to accounts will
be credited with tax-deferred investment gains or losses based on the
performance of investment options you elect from a menu determined by the
company.


 


•                                          Any monies set aside by the company to
pay plan benefits must remain assets of the company until they are paid to you
at predetermined distribution dates.


 


•                                          You, or your beneficiaries, receive
promised benefit payments at the time you separate service from the company.


 


•                                          Benefit payments, when distributed, are
considered ordinary income, subject to federal and state income taxes.


 


2





















 


3.             Types
of Contributions


 


There are various types of contributions to the Assured Guaranty Corp.
Supplemental Executive Retirement Plan:


•              Employee
Elective Deferrals


•              Employer
Matching Contributions


•              Employer
Core Retirement Contributions


 


Employee Elective Deferrals


Your deferrals are made on a pretax basis.  You may elect to defer up ro 6% of your cash
compensation.  Deferral elections must be
made in the calendar year prior to the year in which you earn the compensation
(e.g., for compensation earned and paid in 2006, elections must be made no
later than December 31, 2005).


 


If you become eligible to participate during a plan year, and you are
not eligible for any other 409A plan, you may elect to participate by making
your deferral elections within 30 days of the date you are designated as
eligible to join the Plan, and only compensation earned on or after your date
of eligibility is subject to deferral.


 


Your deferral election is effective for a full plan year and is
irrevocable, i.e., once the plan year begins, you may not increase or decrease
your deferral election.  During each
subsequent plan year open enrollment period you may change the amount of your
deferral.


 


Employer Matching Contributions


If you elect to contribute to the Plan, Assured Guaranty Corp. will
match your 100% of your contribution up to 6% of your cash compensation.


 


Employer Core Retirement Contribution


The Company will also make a Core Retirement Contribution to your
account equal to 6% of that portion of your cash compensation in excess of IRS
limits applicable to the tax-qualified Retirement Plan.


 


Vesting


The amounts you defer are always 100% vested.  Company Matching and Core Retirement Contributions
will vest upon your completion of one year of service.  Your account will also be 100% vested upon
your death or attainment of age 65.


 


 


3





















 


FICA
Taxation


Your deferrals are subject to FICA taxes at the time of deferral;
benefit payments, however, will not be subject to these taxes.  Employer Contributions  (matching and discretionary) are subject to
FICA at the later of  (1) the date on
which the services (for which the amount is to be paid) are performed, or (2)
the date on which the amount is no longer subject to a substantial risk of
forfeiture, i.e., becomes vested.


 


FICA, the Federal Insurance Contributions Act, provides for Old-Age
Survivors and Disability Insurance (OASDI) which is commonly referred to as
Social Security, and Health Insurance (HI) which is commonly referred to as
Medicare.  Both employees and employers
must pay these taxes.  The FICA Social
Security tax on each employee is 6.2% on compensation earned in a calendar year
up to the wage base.  Each year, usually
in October, the government sets the wage base for the next year — for 2006 the
wage base is $94,200.  The HI employee
tax rate, or Medicare portion, is 1.45%. 
However, there is no wage base limitation for the Medicare portion of
FICA so that all compensation earned during a calendar year is subject to the
1.45% tax.


 


 


4





















 


 


4.             Plan Benefits


 


Accounts are subject to the following general parameters:


 


•                                          At the time of your deferral you must
specify the form of distribution (e.g., lump sum or annual installments) of
your contributions for the next plan year.


 


•                                          The form of distribution you elect will
be effective for all contributions made to the plan on or after January 1,
2005.


 


•                                          All elections must be made on or before
December 31st of the year prior to the plan year for which the election is
effective.


 


 


5





















 


5.             Investment
Options


 


Investment Measurement Option
Choices


You may elect any combination of the investment options outlined
below.  You may indicate your election on
the investment allocation form in any amount desired as long as amounts
indicated are whole percentages (i.e. 1% increments).  Your account is credited with earnings or
losses equal to the selected investment measurement vehicles.  If you do not make investment option choices,
your account will be deemed to be invested in the Money Market option.  You may choose among the following investment
options*:


 










*Premier and Select are abbreviated marketing
designations for the MassMutual Premier Funds and MassMutual Select Funds,
respectively, and are not the legal names for these two fund families or the
underlying mutual funds offered.


 


Investment Fund Selection


 


	
  Mutual Fund

  	
   

  	
  Share Class

  	
   

  	
  Ticker Symbol

  	
   

  
	
  SHORT TERM

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Premier Money Market Fund

  	
   

  	
  A

  	
   

  	
  MKAXX

  	
   

  
	
  FIXED INCOME

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Premier Core Bond Fund

  	
   

  	
  A

  	
   

  	
  MMCBX

  	
   

  
	
  Oppenheimer High Yield Fund

  	
   

  	
  A

  	
   

  	
  OPPHX

  	
   

  
	
  BALANCED

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Oppenheimer Quest Balanced Fund

  	
   

  	
  A

  	
   

  	
  QVGIX

  	
   

  
	
  LARGE CAP VALUE

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Select Fundamental Value Fund

  	
   

  	
  A

  	
   

  	
  MFUAX

  	
   

  
	
  Select Value Equity Fund

  	
   

  	
  A

  	
   

  	
  MMVAX

  	
   

  
	
  LARGE CAP CORE

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Premier Main Street Fund

  	
   

  	
  A

  	
   

  	
  MSSAX

  	
   

  
	
  Select Indexed Equity Fund

  	
   

  	
  A

  	
   

  	
  MIEAX

  	
   

  
	
  LARGE CAP GROWTH

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Premier Capital Appreciation Fund

  	
   

  	
  A

  	
   

  	
  MACAX

  	
   

  
	
  Select Aggressive Growth Fund

  	
   

  	
  A

  	
   

  	
  MMAAX

  	
   

  
	
  SMALL/MID CAP VALUE

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Select Focused Value Fund

  	
   

  	
  A

  	
   

  	
  MFVAX

  	
   

  
	
  Select Small Company Value Fund

  	
   

  	
  A

  	
   

  	
  MMYAX

  	
   

  
	
  SMALL/MID CAP GROWTH

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Select Mid-Cap Growth Equity II Fund

  	
   

  	
  A

  	
   

  	
  MEFAX

  	
   

  
	
  Select Small Cap Growth Equity Fund

  	
   

  	
  A

  	
   

  	
  MMGEX

  	
   

  
	
  INTERNATIONAL / GLOBAL

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Premier Global Fund

  	
   

  	
  A

  	
   

  	
  MGFAX

  	
   

  



 


6





















 


Transfer
Options


You may change the investment allocations for new contributions and /or
transfer existing balances between investment options at any time, up to six
(6) times during the plan year, using the Investment Allocation Change Form
available from your plan administrator. Both current balances and future
contributions will be changed as soon as administratively possible after
written notice is received.


 


Investment change requests received by 10:00 am ET will be initiated
the same business day, and changes received after 10:00 am ET will be initiated
as soon as possible, but no later than the next business day.  If you have questions regarding Plan
investment changes, contact Charon Planning at 800-692-8463 (8:30 am ET to 5:00
pm ET).


 


Participant Information and Web
Access


You will receive a statement of account each quarter (as of March 31,
June 30, September 30, and December 31). 
These statements will allow you to monitor your investment elections and
the value of your accounts.


 


You will also have access to your account balance on a daily basis
through the MassMutual website, The Journeysm, using the same access information
as for your qualified retirement plan. 
The website access is:
https://wwwrs.massmutual.com/journey/login.asp. 
If you forget or lose your PIN, contact the Participant Information
Center of MassMutual at 800-743-5274 (8:00 am to 8:00 pm ET) and ask for
assistance.


 


 


7





















 


6.             Distributions


 


General
Rules


All distributions are governed by IRC Section 409A and related
regulations and by the Plan document. 
Some general rules that apply to all types of distributions include:


 


•                                          The amount and form (e.g. lump sum or
installments) of a distribution depends on the election you made at the time of
the deferral and the occurrence of a specific distribution event.  When such an event occurs, benefit payments
become due.


 


•                                          Benefit payments commence as soon as
practicable, but no later than 60 days, following the distribution event.


 


•                                          All benefit payments are based on the
account balance at the time benefit payments are made.


 


•                                          If benefit payments are made over a
series of installments, payments will be made in substantially equal annual
installments over the number of years you indicate.  During the installment period, the account
continues to be credited with earnings and losses that reflect investment
performance of the selected investment measurement options.


 


•                                          If your entire account balance is less
than $10,000 at the time of the distribution, you will receive a lump-sum
payment of your account balance regardless of your payout election.


 


•                                          If you die while receiving installments,
your beneficiary will receive a lump-sum payment of the remainder of your
account balance as soon as administratively possible following notification of
your death.


 


Distribution Events


The Supplemental Executive Retirement Plan provides for the following
distribution events:


•              Retirement


•              Separation
from Service


 


 


8





















 


Retirement


If you separate from service with the company at or after having
attained age 55 with a minimum of ten (10) years of service, your account is
distributed to you in a lump sum or annual installments up to five (5) years as
you elected as of your date of eligibility. 
If no election is made, the distribution is made in a lump sum.  Benefit payments commence with 60 days of
your Retirement, unless you are a Specified Employee.


 


Separation from Service


If you separate from service for any reason other than Retirement, your
vested account balance will be paid to you in a lump sum as soon as
practicable, but no later than 60 days, after your separation from service,
unless you are a Specified Employee.  Any
non-vested amounts will be forfeited.


 


Distributions to Specified
Employees


Since Assured Guaranty, Ltd. is a public company, the Plan must impose
additional restrictions (due to 409A) on distributions made to certain
participants.  If you are a “Specified
Employee” as defined in the Plan document, upon your separation from service
for any reason other than Disability or death, a distribution may not be made
before the date which is six (6) months after the date of separation from
service (or, if earlier, your date of death).


 


Redeferral Election


If you wish to postpone the distribution of one of your accounts, or if
you wish to change the form of payout of an account, you may submit a
Redeferral Election to the company.  The
election must meet the following requirements imposed by IRC Section 409A:


 


1.                                       the election may not take effect until at
least 12 months after the date on which the election is made, and


2.                                       the account distribution date with
respect to which such election is made is deferred for a period of not less
than 5 years from the date such payment would otherwise have been paid.


 


Once benefit payments have commenced for a given account, you may not
make any changes to the time and form of the distribution of that account.


 


Loans Not Permitted


Loans are not permitted from Supplemental Executive Retirement Plans.


 


 


9





















 


Income
Taxation


Benefit payments are subject to federal income taxation, and state
income taxation, when paid.  Amounts paid
from the Plan are not eligible for any form of tax-sheltered rollover. However,
distributions, including those made prior to age 591⁄2, are not subject to the
qualified plan 10% penalty tax (i.e., the 10% penalty for distributions from a
retirement plan prior to age 59 1⁄2.)


 


 


10





















 


7.             Plan
Administration


 


Plan Administrator


Assured Guaranty Corp. has administrative responsibilities for the
Plan.  If you have any questions or
concerns about the program, please contact:


Ivana Grillo


Assured Guaranty Corp.


1325 Avenue of the Americas, 18th Floor


New York, NY 
10019-6011


Tel: (212) 974-0100


 


Claims
Review


In the event that you or your beneficiary do not receive any Plan
benefit that is claimed, you or your beneficiary can request a review as
provided in the Plan document in a manner designed to comply with section 503
of the Employee Retirement Income Security Act of 1974, as amended.


 


Plan Documentation


This program is governed by the Assured Guaranty Corp. Supplemental
Executive Retirement Plan document.  If
any provisions of this booklet contradict the Plan document, the Plan document
provisions prevail.  All documents, e.g.,
Plan, trust, deferral forms, are on file with the plan administrator and are
available to you upon request.


 


Plan Amendment or Termination


This Plan may be amended or terminated by the company at its discretion
provided that no such amendment or termination shall deprive you of a right
accrued prior to the date of amendment or termination, and provided that no
such termination shall accelerate the distribution date(s) for your accounts,
except as permitted by applicable law.


 


 


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