exv10w4





Exhibit 10.4



AMENDED AND RESTATED

INDEMNIFICATION AGREEMENT




     This INDEMNIFICATION AGREEMENT is made and executed as of this 1st day of December,
2010, by and among Allied World Assurance Company Holdings, AG, a company incorporated under the
laws of Switzerland (the “Company”), Allied World Assurance Company, Ltd, a company incorporated
under the laws of Bermuda (“AWAC”), and                     , an individual resident of
                    
(the “Indemnitee”).



     WHEREAS, the Company is aware that, in order to induce highly competent persons to serve the
Company as directors or officers or in other capacities, the Company must provide such persons with
adequate protection through insurance and indemnification against inordinate risks of claims and
actions against them arising out of their service to and activities on behalf of the Company;



     WHEREAS, the Company recognizes that the increasing difficulty in obtaining directors’ and
officers’ liability insurance, the increases in the cost of such insurance and the general
reductions in the coverage of such insurance have increased the difficulty of attracting and
retaining such persons;



     WHEREAS, the Board of Directors of the Company has determined that it is essential to the best
interests of the Company shareholders that the Company act to assure such persons that there will
be increased certainty of such protection in the future;



     WHEREAS, it is reasonable, prudent and necessary for the Company contractually to obligate
itself to indemnify such persons to the fullest extent permitted by applicable law so that they
will continue to serve the Company free from undue concern that they will not be so indemnified;



     WHEREAS, the Indemnitee is willing to serve, continue to serve, and take on additional service
for or on behalf of the Company or any of its direct or indirect subsidiaries on the condition that
he/she be so indemnified;



     WHEREAS, in recognition of the value and benefit that AWAC derives from being a subsidiary of
the Company and from the services performed by the Board of Directors and officers of the Company,
subject to the terms and conditions of this Agreement, AWAC will guaranty the obligations of the
Company to provide indemnification to and pay and/or advance the Expenses (as herein after defined)
of the Indemnitee to the extent the Company is unable to do so;



     WHEREAS, Allied World Assurance Company Holdings, Ltd, a Bermuda company and an affiliate of
the Company (“Allied World Bermuda”), and Indemnitee previously entered into an indemnification
agreement as of [          ] (the “Former Indemnification Agreement”); and



 









 





     WHEREAS, Indemnitee and the Company now desire to enter into a new agreement embodying the
amended and restated terms of indemnification as set forth herein (this “Agreement”), and the
Indemnitee, the Company and Allied World Bermuda hereby agree that this Agreement shall upon its
execution and delivery supersede the Former Indemnification Agreement and cause the Former
Indemnification Agreement to be of no further force or effect, and that Indemnitee’s rights to
indemnification shall be governed solely by and subject solely to this Agreement;



     NOW, THEREFORE, the parties hereto do hereby agree as follows:



     1. Service by the Indemnitee. The Indemnitee agrees to serve and/or continue to serve as [a
member of the Board] [an officer] of the Company faithfully and will discharge his/her duties and
responsibilities to the best of his/her ability so long as the Indemnitee is duly elected or
qualified in accordance with the provisions of the Articles of Association, as the same may be
amended from time to time (the “Articles”), the Organizational Regulations, as the same may be
amended from time to time, and the Swiss Code of Obligations (the “Swiss Code”), or until his/her
earlier death, resignation or removal. The Indemnitee may at any time and for any reason resign
from such position (subject to any other contractual obligation or other obligation imposed by
operation by law), in which event the Company shall have no obligation under this Agreement to
continue the Indemnitee in any such position. Nothing in this Agreement shall confer upon the
Indemnitee the right to continue in the employ of the Company or as a director of the Company or
affect the right of the Company to terminate the Indemnitee’s employment at any time in the sole
discretion of the Company, with or without cause, subject to any contract rights of the Indemnitee
created or existing otherwise than under this Agreement.



     2. Indemnification. The Company shall indemnify the Indemnitee against all Expenses,
judgments, fines and amounts paid in settlement actually and reasonably incurred by the Indemnitee
as provided in this Agreement to the fullest extent permitted by the Articles and the Swiss Code or
other applicable law in effect from time to time if he/she acted in good faith and reasonably
believed he/she was acting in the best interest of the Company. Without diminishing the scope of
the indemnification provided by this Section 2, the rights of indemnification of the Indemnitee
provided hereunder shall include, but shall not be limited to, those rights hereinafter set forth,
except that no indemnification shall be paid to the Indemnitee:




     (a) on account of any action, suit, investigation or proceeding in which
judgment is rendered against the Indemnitee for disgorgement of profits made from
the purchase or sale by the Indemnitee of securities of the Company pursuant to the
provisions of Section 16(b) of the Securities Exchange Act of 1934, as amended (the
“Act”), or similar provisions of applicable law;




     (b) with respect to any claim, issue or matter as to which the Indemnitee shall
have been adjudged in a final non-appealable judgment or decree of a court, arbitral
tribunal or governmental or administrative authority of competent jurisdiction to
have committed an intentional or grossly negligent breach of his/her duties [as a
member of the Board] [as an executive officer] under applicable law;



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     (c) in any circumstance where such indemnification is prohibited by applicable
law;




     (d) with respect to liability for which payment is actually made to the
Indemnitee under a valid and collectible insurance policy or under a valid and
enforceable indemnity clause, Articles or agreement (other than this Agreement),
except in respect of any liability in excess of payment under such insurance,
clause, Articles or agreement;




     (e) if a final decision by a court having jurisdiction in the matter shall
determine that such indemnification is not lawful (and, in this respect, both the
Company and the Indemnitee have been advised that it is the position of the
Securities and Exchange Commission that indemnification for liabilities arising
under the federal securities laws is against public policy and is, therefore,
unenforceable, and that claims for indemnification should be submitted to the
appropriate court for adjudication); or




     (f) in connection with any action, suit, investigation or proceeding by the
Indemnitee against the Company or any of its direct or indirect subsidiaries or the
directors, officers, employees or other Indemnitees of the Company or any of its
direct or indirect subsidiaries, (i) unless such indemnification is expressly
required to be made by law, (ii) unless the proceeding was authorized by the Board
of Directors of the Company, (iii) unless such indemnification is provided by the
Company, in its sole discretion, pursuant to the powers vested in the Company under
applicable law, or (iv) except as provided in Sections 10 and 12 hereof.



     3. Actions or Proceedings Other Than an Action by or in the Right of the Company. The
Indemnitee shall be entitled to the indemnification rights provided in this Section 3 if the
Indemnitee was or is a party or witness or is threatened to be a party or witness to any
threatened, pending or completed action, suit, investigation or proceeding, whether civil,
criminal, administrative or investigative in nature, other than an action by or in the right of the
Company, by reason of the fact that the Indemnitee is or was a director, officer, employee, agent
or fiduciary of the Company, or any of its direct or indirect subsidiaries, or is or was serving at
the request of the Company, or any of its direct or indirect subsidiaries, as a director, officer,
employee, agent or fiduciary of any other entity, including, but not limited to, another
corporation, partnership, limited liability company, employee benefit plan, joint venture, trust or
other enterprise, or by reason of any act or omission by him/her in such capacity. Pursuant to
this Section 3, the Indemnitee shall be indemnified against all Expenses, judgments, penalties
(including excise and similar taxes), fines and amounts paid in settlement which were actually and
reasonably incurred by the Indemnitee in connection with such action, suit, investigation or
proceeding (including, but not limited to, the investigation, defense or appeal thereof); provided,
however, that this indemnity shall only apply to the extent permitted by Section 2 and further
provided that with respect to any criminal or penal proceeding or investigation, only to the extent
the Indemnitee had no reasonable cause to believe his/her conduct was unlawful.



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     4. Actions by or in the Right of the Company. The Indemnitee shall be entitled to the
indemnification rights provided in this Section 4 if the Indemnitee was or is a party or witness or
is threatened to be made a party or witness to any threatened, pending or completed action, suit,
investigation or proceeding brought by or in the right of the Company to procure a judgment in its
favor by reason of the fact that the Indemnitee is or was a director, officer, employee, agent or
fiduciary of the Company, or any of its direct or indirect subsidiaries, or is or was serving at
the request of the Company, or any of its direct or indirect subsidiaries, as a director, officer,
employee, agent or fiduciary of another entity, including, but not limited to, another corporation,
partnership, limited liability company, employee benefit plan, joint venture, trust or other
enterprise, or by reason of any act or omission by him/her in any such capacity. Pursuant to this
Section 4, the Indemnitee shall be indemnified against all Expenses actually and reasonably
incurred by him/her in connection with the defense or settlement of such action, suit,
investigation or proceeding (including, but not limited to the investigation, defense or appeal
thereof); provided, however, that this indemnity shall only apply to the extent permitted by
Section 2 and further provided that with respect to any criminal or penal proceeding or
investigation, only to the extent the Indemnitee had no reasonable cause to believe his/her conduct
was unlawful.



     5. Indemnification for Expenses of Successful Party. Notwithstanding the other provisions of
this Agreement, to the extent that the Indemnitee has served on behalf of the Company, or any of
its direct or indirect subsidiaries, as a witness or other participant in any class action or
proceeding, or has been successful, on the merits or otherwise, in defense of any action, suit,
investigation or proceeding referred to in Section 3 and 4 hereof, or in defense of any claim,
issue or matter therein, including, but not limited to, the dismissal of any action without
prejudice, the Indemnitee shall be indemnified against all Expenses actually and reasonably
incurred by the Indemnitee in connection therewith; provided, however, that this indemnity shall
only apply to the extent permitted by Section 2.



     6. Partial Indemnification. If the Indemnitee is entitled under any provision of this
Agreement to indemnification by the Company for some or a portion of the Expenses, judgments,
penalties, fines and amounts paid in settlement actually and reasonably incurred by the Indemnitee
in connection with the investigation, defense, appeal or settlement of such suit, action,
investigation or proceeding described in Section 3 or 4 hereof, but is not entitled to
indemnification for the total amount thereof, the Company shall nevertheless indemnify the
Indemnitee for the portion of such Expenses, judgments, penalties, fines and amounts paid in
settlement actually and reasonably incurred by the Indemnitee to which the Indemnitee is entitled.



     7. Procedure for Determination of Entitlement to Indemnification.



     (a) To obtain indemnification under this Agreement, the Indemnitee shall submit to the
Company a written request, including documentation and information which is reasonably available to
the Indemnitee and is reasonably necessary to determine whether and to what extent the Indemnitee
is entitled to indemnification. The Secretary of the Company shall, promptly upon receipt of a
request for indemnification, advise the Board of Directors in writing that the Indemnitee has
requested indemnification. Any Expenses incurred by the Indemnitee in



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connection with the Indemnitee’s request for indemnification hereunder shall be borne by the
Company.




     (b) Upon written request by the Indemnitee for indemnification pursuant to Section 3 or 4
hereof, the entitlement of the Indemnitee to indemnification pursuant to the terms of this
Agreement shall be determined by the following person or persons, who shall be empowered to make
such determination: (i) if a Change in Control (as hereinafter defined) shall have occurred, by
Independent Counsel (as hereinafter defined) (unless (x) the Company receives advice from legal
counsel that the Board of Directors is required by applicable law to make the determination, in
which case the determination shall be made by the Board of Directors in the manner provided for in
clause (ii) of this Section 7(b) or (y) the Indemnitee shall request in writing that such
determination be made by the Board of Directors in the manner provided for in clause (ii) of this
Section 7(b)) in a written opinion to the Board of Directors, a copy of which shall be delivered to
the Indemnitee; or (ii) if a Change in Control shall not have occurred, (A)(1) by the Board of
Directors of the Company, by a majority vote of Disinterested Directors (as hereinafter defined)
even though less than a quorum or (B) if there are no such Disinterested Directors, by Independent
Counsel in a written opinion to the Board of Directors, a copy of which shall be delivered to the
Indemnitee. Such Independent Counsel shall be selected by the Board of Directors and approved by
the Indemnitee. If there are no Disinterested Directors and the Board of Directors and the
Indemnitee fail to agree on a mutually acceptable Independent Counsel, either the Board of
Directors or the Indemnitee may request the International Chamber of Commerce (“ICC”) to appoint an
Independent Counsel in accordance with the provisions regarding the appointment of experts
contained in the ICC’s Rules for Expertise. If the person making such determination shall
determine that the Indemnitee is entitled to indemnification as to part (but not all) of the
application for indemnification, such person shall reasonably prorate such part of indemnification
among such claims, issues or matters. If it is so determined that the Indemnitee is entitled to
indemnification, payment to the Indemnitee shall be made within ten days after such determination.



     8. Presumptions and Effect of Certain Proceedings.



     (a) In making a determination with respect to entitlement to indemnification, the Indemnitee
shall be presumed to be entitled to indemnification hereunder and the Company shall have the burden
of proof in the making of any determination contrary to such presumption.



     (b) The termination of any action, suit, investigation or proceeding described in Section 3
or 4 hereof by judgment, order, settlement or conviction, or upon a plea of nolo contendere or its
equivalent, shall not, of itself: (a) create a presumption that the Indemnitee did not act in good
faith and in a manner he/she reasonably believed to be in the best interest of the Company; or (b)
otherwise adversely affect the rights of the Indemnitee to indemnification, except as may be
provided herein.



     9. Advancement of Expenses.



     (a) Subject to Section 9(b), all reasonable Expenses actually incurred by the Indemnitee in
connection with any threatened or pending action, suit, investigation or proceeding by reason of
the fact that the Indemnitee is or was a director, officer, employee, agent or fiduciary of the



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Company shall be paid by the Company in advance of the final disposition of such action, suit,
investigation or proceeding, if so requested by the Indemnitee, within 20 days (unless extended by
the Board of Directors of the Company) after the receipt by the Company of a statement or
statements from the Indemnitee requesting such advance or advances and a copy of any order,
invoice, bill or other evidence of such Expenses reasonably acceptable to the Company. The
Indemnitee may submit such statements and evidence from time to time. The Indemnitee’s entitlement
to such Expenses shall include those incurred in connection with any proceeding by the Indemnitee
seeking an adjudication or award in arbitration pursuant to this Agreement. Such statements and
evidence shall reasonably evidence the Expenses incurred by the Indemnitee in connection therewith
and shall include or be accompanied by a written affirmation by the Indemnitee of the Indemnitee’s
good faith belief that the Indemnitee has met the standard of conduct necessary for indemnification
under this Agreement and an undertaking by or on behalf of the Indemnitee to repay such amount if
it is ultimately determined that the Indemnitee is not entitled to be indemnified against such
Expenses. Each written undertaking to pay amounts advanced must be an unlimited general obligation
but need not be secured, and shall be accepted without reference to financial ability to make
repayment.




     (b) The Company’s obligation to advance Expenses pursuant to this Section 9 shall be subject
to the condition that if (A) the Board of Directors of the Company, by a majority vote of
Disinterested Directors even though less than a quorum or (B) if there are no such Disinterested
Directors, by Independent Counsel (selected in the same manner as in Section 7(b)) in a written
opinion to the Board of Directors, has determined that the Indemnitee would not be permitted to the
advancement of Expenses (or indemnification in respect thereof) under applicable law or under the
terms and conditions of this Agreement, including, without limitation, the principles set out in
Section 2. If such a determination is made, the Indemnitee shall reimburse the Company for any
such amounts theretofore paid by the Company.



     10. Remedies of the Indemnitee in Cases of Determination not to Indemnify or to Advance
Expenses. In the event that a determination is made that the Indemnitee is not entitled to
indemnification hereunder or if the payment has not been timely made following a determination of
entitlement to indemnification pursuant to Section 7, or if Expenses are not advanced pursuant to
Section 9, the Indemnitee shall be entitled to a final adjudication by an arbitral tribunal
appointed in accordance with Section 25(b). Such proceeding shall be made de novo, and the
Indemnitee shall not be prejudiced by reason of a determination (if so made) that the Indemnitee is
not entitled to indemnification or advancement of Expenses. If a determination is made pursuant to
the terms of Section 7 hereof that the Indemnitee is entitled to indemnification, the Company shall
in the absence of any new evidence or facts be bound by such determination and shall be precluded
from asserting that such determination has not been made or that the procedure by which such
determination was made is not valid, binding and enforceable. If the arbitral tribunal shall
determine that the Indemnitee is entitled to any indemnification hereunder, the Company shall pay
all reasonable Expenses actually incurred by the Indemnitee in connection with such adjudication
(including, but not limited to, any appellate proceedings).



     11. Notification and Defense of Claim. Promptly after receipt by the Indemnitee of notice of
the commencement of any action, suit, investigation or proceeding, the Indemnitee will, if a claim
in respect thereof is to be made against the Company under this Agreement, notify the



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Company in writing of the commencement thereof; but the omission to so notify the Company will
not relieve the Company from any liability that it may have to the Indemnitee otherwise than under
this Agreement or otherwise, except to the extent that the Company may suffer material prejudice by
reason of such failure. Notwithstanding any other provision of this Agreement, with respect to any
such action, suit, investigation or proceeding as to which the Indemnitee gives notice to the
Company of the commencement thereof:





     (a) The Company will be entitled to participate therein at its own expense.




     (b) Except as otherwise provided in this Section 11(b), to the extent that it
may wish, the Company, jointly with any other indemnifying party similarly notified,
shall be entitled to assume the defense thereof with counsel reasonably satisfactory
to the Indemnitee. After notice from the Company to the Indemnitee of its election
to so assume the defense thereof, the Company shall not be liable to the Indemnitee
under this Agreement for any legal or other Expenses subsequently incurred by the
Indemnitee in connection with the defense thereof other than reasonable costs of
investigation or as otherwise provided below. The Indemnitee shall have the right
to employ the Indemnitee’s own counsel in such action or lawsuit, but the fees and
Expenses of such counsel incurred after notice from the Company of its assumption of
the defense thereof shall be at the expense of the Indemnitee unless (i) the
employment of counsel by the Indemnitee has been authorized by the Company, (ii) the
Indemnitee shall have reasonably concluded that there may be a conflict of interest
between the Company and the Indemnitee in the conduct of the defense of such action
and such determination by the Indemnitee shall be supported by an opinion of
counsel, which opinion shall be reasonably acceptable to the Company, or (iii) the
Company shall not in fact have employed counsel to assume the defense of the action,
in each of which cases the fees and Expenses of counsel shall be at the expense of
the Company. The Company shall not be entitled to assume the defense of any action,
suit, investigation or proceeding brought by or on behalf of the Company or as to
which the Indemnitee shall have reached the conclusion provided for in clause (ii)
above.




     (c) The Company shall not be liable to indemnify the Indemnitee under this
Agreement for any amounts paid in settlement of any action, suit, investigation or
proceeding effected without its written consent, which consent shall not be
unreasonably withheld. The Company shall not be required to obtain the consent of
the Indemnitee to settle any action, suit, investigation or proceeding which the
Company has undertaken to defend if the Company assumes full and sole responsibility
for such settlement and such settlement grants the Indemnitee a complete and
unqualified release in respect of any potential liability.




     (d) If, at the time of the receipt of a notice of a claim pursuant to this
Section 11, the Company has director and officer liability insurance in effect, the
Company shall give prompt notice of the commencement of such proceeding to the
insurers in accordance with the procedures set forth in the respective policies.



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The Company shall thereafter take all necessary or desirable action to cause
such insurers to pay, on behalf of the Indemnitee, all amounts payable as a result
of such proceeding in accordance with the terms of the policies.



     12. Other Right to Indemnification. The rights of indemnification and advancement of Expenses
as provided by this Agreement shall not be deemed exclusive of any other rights to which the
Indemnitee may at any time be entitled under applicable law, the Articles, any agreement, a vote of
shareholders of the Company or a resolution of directors of the Company, or otherwise.



     13. Director and Officer Liability Insurance. The Company shall maintain directors’ and
officers’ liability insurance for so long as the Indemnitee’s services are covered hereunder,
provided and to the extent that such insurance is available on a commercially reasonable basis. In
the event the Company maintains directors’ and officers’ liability insurance, the Indemnitee shall
be named as an insured in such manner as to provide the Indemnitee the same rights and benefits as
are accorded to the most favorably insured of the Company’s officers or directors. However, the
Company agrees that the provisions hereof shall remain in effect regardless of whether liability or
other insurance coverage is at any time obtained or retained by the Company, except that any
payments made to, or on behalf of, the Indemnitee under an insurance policy shall reduce the
obligations of the Company hereunder.



     14. Attorney’s Fees and Other Expenses to Enforce Agreement. In the event that the Indemnitee
is subject to or intervenes in any action, suit, investigation or proceeding in which the validity
or enforceability of this Agreement is at issue or seeks an adjudication or award in arbitration to
enforce the Indemnitee’s rights under, or to recover damages for breach of, this Agreement the
Indemnitee, if he/she prevails in whole or in part in such action, shall be entitled to recover
from the Company and shall be indemnified by the Company against any actual expenses for attorneys’
fees and disbursements reasonably incurred by the Indemnitee unless an arbitral tribunal determines
that any of the material assertions made by the Indemnitee in such proceeding was not made in good
faith or was frivolous.



     15. Effective Date. The provisions of this Agreement shall cover claims, actions, suits,
investigations or proceedings whether now pending or hereafter commenced and shall be retroactive
to cover acts or omissions or alleged acts or omissions which heretofore have taken place. The
Company shall be liable under this Agreement, pursuant to Sections 3 and 4 hereof, for all acts of
the Indemnitee while serving as a director and/or officer, notwithstanding the termination of the
Indemnitee’s service, if such act was performed or omitted to be performed during the term of the
Indemnitee’s service to the Company.



     16. Duration of Agreement. This Agreement shall survive and continue even though the
Indemnitee may have terminated his/her service as a director, officer, employee, agent or fiduciary
of the Company or as a director, officer, employee, agent or fiduciary of any other entity,
including, but not limited to, another corporation, partnership, limited liability company,
employee benefit plan, joint venture, trust or other enterprise or by reason of any act or omission
by the Indemnitee in any such capacity. This Agreement shall be binding upon the Company and its
successors and assigns, including, without limitation, any company or other entity which may have
acquired all or substantially all of the Company’s assets or business or



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into which the Company may be consolidated or merged, and shall inure to the benefit of the
Indemnitee and his/her successors, assigns, heirs, devisees, executors, administrators or other
legal representations. The Company shall require any successor or assignee (whether direct or
indirect, by purchase, merger, consolidation or otherwise) to all or substantially all of the
business and/or assets of the Company, by written agreement in form and substance reasonably
satisfactory to the Company and the 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 or assignment had taken place.




     17. Guaranty. To the extent that the Company is unable to provide the indemnification and/or
the payment of Expenses to Indemnitee due hereunder, AWAC hereby agrees to assume such obligations,
subject to the terms and conditions of this Agreement and any other defenses in law or equity that
the Company may have. Should AWAC provide such indemnification and/or the payment of Expenses to
Indemnitee under this Agreement, the Indemnitee hereby agrees that it shall reimburse or repay AWAC
to the same extent that the Indemnitee would otherwise be required to reimburse or repay to the
Company under the terms hereof.



     18. Disclosure of Payments. Except as expressly required by any federal or state securities
laws or other federal or state law, neither party shall disclose any payments under this Agreement
unless prior approval of the other party is obtained.



     19. Severability. If any provision or provisions of this Agreement shall be held invalid,
illegal or unenforceable for any reason whatsoever, (a) the validity, legality and enforceability
of the remaining provisions of this Agreement (including, but not limited to, all portions of any
Sections of this Agreement containing any such provision held to be invalid, illegal or
unenforceable) shall not in any way be affected or impaired thereby and (b) to the fullest extent
possible, the provisions of this Agreement (including, but not limited to, all portions of any
paragraph of this Agreement containing any such provision held to be invalid, illegal or
unenforceable, that are not themselves invalid, illegal or unenforceable) shall be construed so as
to give effect to the intent manifest by the provision held invalid, illegal or unenforceable.



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



     21. Captions. The captions and headings used in this Agreement are inserted for convenience
only and shall not be deemed to constitute part of this Agreement or to affect the construction
thereof.



     22. Definitions. For purposes of this Agreement:




     (a) “Change in Control” shall mean a change in control of the Company occurring
after the date hereof of a nature that would be required to be reported in response
to Item 6(e) of Schedule 14A of Regulation 14A (or in response to any similar item
on any similar schedule or form) promulgated under



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the Act, whether or not the Company is then subject to such reporting
requirement; provided, however, that, without limitation, a Change in Control shall
include: (i) the acquisition (other than from the Company) after the date hereof by
any person, entity or “group” within the meaning of Section 13(d)(3) or 14(d)(2) of
the Act (excluding, for this purpose, the Company or its subsidiaries, any employee
benefit plan of the Company or its subsidiaries which acquires beneficial ownership
of voting securities of the Company, and any qualified institutional investor who
meets the requirements of Rule 13d-1(b)(1) promulgated under the Act) of beneficial
ownership (within the meaning of Rule 13d-3 promulgated under the Act), of 20% or
more of either the then-outstanding shares of common stock or the combined voting
power of the Company’s then-outstanding capital stock entitled to vote generally in
the election of directors; (ii) individuals who, as of the date hereof, constitute
the Board of Directors (the “Incumbent Board”) ceasing for any reason to constitute
at least a majority of the Board of Directors, provided that any person becoming a
director subsequent to the date hereof whose election, or nomination for election by
the Company’s shareholders was approved by a vote of at least a majority of the
directors then comprising the Incumbent Board (other than an election or nomination
of an individual whose initial assumption of office is in connection with an actual
or threatened election contest relating to the election of the directors of the
Company) shall be, for purposes of this Agreement, considered as though such person
were a member of the Incumbent Board; or (iii) approval by the shareholders of the
Company of (A) a reorganization, merger, amalgamation or consolidation, in each
case, with respect to which persons who were the shareholders of the Company
immediately prior to such reorganization, merger, or consolidation do not,
immediately thereafter, own more than 75% of the combined voting power entitled to
vote generally in the election of directors of the reorganized, merged, amalgamated,
consolidated or other surviving company’s then-outstanding voting securities, (B) a
liquidation or dissolution of the Company, or (C) the sale of all or substantially
all of the assets of the Company.




     (b) “Disinterested Director” shall mean a director of the Company who is not or
was not a party to the action, suit, investigation or proceeding in respect of which
indemnification is being sought by the Indemnitee.




     (c) “Expenses” shall include all attorneys’ fees, retainers, court costs,
transcript costs, fees of experts, witness fees, travel expenses, duplicating costs,
printing and binding costs, telephone charges, postage, delivery service fees and
all other disbursements or expenses incurred in connection with prosecuting,
defending, preparing to prosecute or defend, investigating or being or preparing to
be a witness in any threatened, pending or completed action, suit, investigation or
proceeding, whether civil, criminal, administrative or investigative in nature.




     (d) “Independent Counsel” shall mean a law firm or a member of a law firm
specializing in Swiss corporate law and who is authorized to practice law in
Switzerland and who neither is presently nor in the past five years has been



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retained to represent (i) the Company or the Indemnitee in any matter material
to either such party or (ii) any other party to the action, suit, investigation or
proceeding giving rise to a claim for indemnification or advancement of Expenses
hereunder. Notwithstanding the foregoing, the term “Independent Counsel” shall not
include any person who, under the applicable standards of professional conduct then
prevailing, would have a conflict of interest in representing either the Company or
the Indemnitee in an action to determine the Indemnitee’s right to indemnification
under this Agreement.



     23. Entire Agreement, Modification and Waiver. This Agreement constitutes the entire
agreement and understanding of the parties hereto regarding the subject matter hereof, and no
supplement, modification or amendment of this Agreement (including any amendment of this Section
23) shall be binding unless executed in writing by the parties hereto. No waiver of any of the
provisions of this Agreement shall be deemed or shall constitute a waiver of any other provisions
hereof (whether or not similar) nor shall such waiver constitute a continuing waiver. No
supplement, modification or amendment of this Agreement shall limit or restrict any right of the
Indemnitee under this Agreement in respect of any act or omission of the Indemnitee prior to the
effective date of such supplement, modification or amendment unless expressly provided therein.



     24. Notices. All notices, requests, demands or other communications hereunder shall be in
writing and shall be deemed to have been duly given if (i) delivered by hand with receipt
acknowledged by the party to whom said notice or other communication shall have been directed, (ii)
mailed by certified or registered mail, return receipt requested with postage prepaid, on the date
shown on the return receipt or (iii) delivered by facsimile transmission on the date shown on the
facsimile machine report:




	 	(a)	 	If to the Indemnitee, to:
	 
	 	 	 	            
             
             
  
        
           
          
          

        
          
         
             
	 
	 	(b)	 	If to the Company, to:
	 
	 	 	 	Allied World Assurance Company Holdings, AG

27 Richmond Road

Pembroke, Bermuda HM08

Attention: General Counsel




or to such other address as may be furnished to the Indemnitee by the Company or to the Company by
the Indemnitee, as the case may be.




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     25. Governing Law; Arbitration.



     (a) The parties hereto agree that this Agreement shall be governed by, and construed in
accordance with, the substantive laws of Switzerland.



     (b) Any dispute, controversy or claim arising out of, in connection with or relating to this
Agreement, or the breach thereof, shall be settled, to the exclusion of the ordinary courts, by
arbitration administered by the Swiss Chamber of Commerce in accordance with the Swiss Rules of
International Arbitration in force on the date when the notice of arbitration is submitted in
accordance with the aforementioned Rules. The number of arbitrators shall be three. The seat of the
arbitration shall be New York City, New York, United States of America. The arbitral proceedings
shall be conducted in the English language.



-12-









 





     IN WITNESS WHEREOF, the parties hereto have executed this Agreement on the day and year first
above written.



	 	 	 	 	 
	 	ALLIED WORLD ASSURANCE COMPANY HOLDINGS, AG

 	 
	 	By:  	 	 
	 	Name:  	 	 
	 	Title:  	 	 
	 
	 	ALLIED WORLD ASSURANCE COMPANY, LTD

 	 
	 	By:  	 	 
	 	Name:  	 	 
	 	Title:  	 	 
	 
	 	INDEMNITEE

 	 
	 	By:  	 	 
	 	Name:  	 	 
	 	 	 
	 
	 	ACCEPTED AND AGREED,
as to the eighth recital hereto



ALLIED WORLD ASSURANCE COMPANY HOLDINGS, LTD

 	 
	 	By:  	 	 
	 	Name:  	 	 
	 	Title: