Exhibit 10.2


AMENDMENT TO 

EMPLOYMENT AGREEMENT


                    AMENDMENT
TO EMPLOYMENT AGREEMENT (“Amendment”) dated as of December 19, 2008
between XL Capital Ltd, a Cayman Islands corporation (the “Company”), and David
B. Duclos (the “Executive”).


                    WHEREAS,
the Company and the Executive are parties to an Employment Agreement dated as of
January 25, 2008 (the
“Agreement”);


                    WHEREAS,
the Company and the Executive wish to amend the Agreement as set forth herein;


                    NOW,
THEREFORE, in consideration of the mutual covenants herein contained, and for
other good and valuable consideration, the receipt and sufficiency of which is
hereby acknowledged, the Company, the Guarantors (as defined in the Agreement)
and the Executive hereby agree as follows:


                    1. The
last paragraph of
Section 8(d)(iii) is amended by deleting “10 days thereafter” and
replacing it with “on the date of the 409A Change in Control.”


                    2.
The first sentence of Section 18(d) is amended to
read in its entirety as follows:


	
 

	
 


	
 

	
“Each
 Party shall bear its own costs incurred in connection with any proceeding
 under Sections 18(a) or 18(b) hereof, including all legal fees and expenses; provided, however, that the Company
 shall bear all such costs of the Executive (to the extent such costs are
 reasonable) if the Executive substantially prevails in a proceeding following
 his “separation from service” (as defined below) with the Company.


	
 

	
 


	
 

	
          3.
 Section
 25(b) is amended to read in its entirety as follows:


	
 

	
 


	
 

	
          “(b)
 Without prejudice to the characterization of any other amounts payable under this
 Agreement, the parties hereto specifically intend that any amounts payable under Section
 8(d)(ii)(A)-(C), Section 8(d)(iii)(A)-(D) and Section 11 will not be considered
 deferred compensation for purposes of Section 409A due to Treas. Reg. Section
 1.409A-l(b)(4) or another applicable exception. However, notwithstanding any
 provision to the contrary in this Agreement, if the Executive is deemed on the date
 of his “separation from service” (within the meaning of Treas. Reg. Section
 1.409A-1(h)) with the Company to be a “specified employee” (within the
 meaning of Treas. Reg. Section 1.409A-1(i)), then with regard to any payment or benefit
 that is considered deferred compensation under Section 409A payable on account of
 a “separation from service” that is required to be delayed pursuant to
 Section 409A(a)(2)(B) of the Code (after taking into account any applicable
 exceptions to such requirement), such payment or benefit shall be made or provided on the
 date that is the earlier of (i) the expiration of the six (6)-month












	
 

	
 


	
 

	
period
 measured from the date of the Executive’s “separation from service,” or (ii)
 the date of the Executive’s death (the “Delay Period”). Upon the expiration
 of the
 Delay Period, all payments and benefits delayed pursuant to this Section
 25(b) (whether
 they would have otherwise been payable in a single sum or in installments in the absence of
 such delay) shall be paid or reimbursed to the Executive in a lump sum and any
 remaining payments and benefits due under this Agreement shall be paid or
 provided in accordance with the normal payment dates specified for them
 herein. Notwithstanding any provision of this Agreement to the contrary, for
 purposes of any provision of this Agreement providing for the payment of any
 amounts or benefits upon or following a termination of employment, references to
 the Executive’s “termination of employment” (and corollary terms) with the
 Company shall be construed to refer to the Executive’s “separation from
 service” (within the meaning of Treas. Reg. Section 1.409A-l(h)) with the
 Company. With respect to any reimbursement or in-kind benefit arrangements
 of the Company and its subsidiaries that constitute deferred compensation for purposes of
 Section 409A, except as otherwise permitted by Section 409A, the following conditions
 shall be applicable: (i) the amount eligible for reimbursement, or in-kind
 benefits provided, under any such arrangement in one calendar year may not
 affect the amount eligible for reimbursement, or in-kind benefits to be
 provided, under such arrangement in any other calendar year (except that the health and dental
 plans may impose a limit on the amount that may be reimbursed or paid), (ii)
 any reimbursement must be made on or before the last day of the calendar year following
 the calendar year in which the expense was incurred, and (iii) the right to
 reimbursement or in-kind benefits is not subject to liquidation or exchange
 for another benefit. Whenever a payment under this Agreement specifies a payment period
 with reference to a number of days (e.g., “payment shall be made within
 thirty (30) days after termination of employment”), the actual date of payment within the
 specified period shall be within the sole discretion of the Company. Whenever
 payments under this Agreement are to be made in installments, each such
 installment shall be deemed to be a separate payment for purposes of Section
 409A.”


	
 

	
 


	
 

	
          4.
 The definition of “Good Reason” in Exhibit B is amended to read in its entirety as follows:


	
 

	
 


	
 

	
          “For
 purposes of this Agreement, “Good Reason” shall mean any of the following,
 unless done with the prior express written consent of Executive:


	
 

	
 


	
 

	
          (i)
 (A) The assignment to Executive of duties materially inconsistent with Executive’s
 position (including duties, responsibilities, status, titles or offices as set forth in
 Section 3 hereof); (B) any material diminution or material reduction of Executive’s
 duties or responsibilities except in connection with the termination of
 Executive’s employment for Cause, disability or as a result of Executive’s
 death or by Executive other than for Good Reason; (C) a material diminution in the
 authorities, duties or responsibilities of the supervisor to whom Ex-





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ecutive
 is required to report; or (D) a material diminution in the budget over which Executive
 retains authority;


	
 

	
 


	
 

	
          (ii)
 The (A) material reduction in Executive’s Base Salary from the level in effect
 immediately prior to the Change in Control, or (B) material diminution in bonus
 opportunity that results in a material reduction in Executive’s compensation;


	
 

	
 


	
 

	
          (iii)
 Any material breach by the Company or the Guarantors of this Agreement or any
 material agreement entered into pursuant thereto;


	
 

	
 


	
 

	
          (iv)
 Notwithstanding the provisions of Section 3(b) of this Agreement, requiring
 Executive to be based at any office or location that is greater than 35 miles from the office
 or location at which Executive was principally located immediately prior to
 the Change in Control;


	
 

	
 


	
 

	
          (v)
 During the Post-Change Period, the failure to continue in effect any material
 compensation or incentive plan in which Executive participates immediately
 prior to the time of the Change in Control unless an equitable arrangement
 (embodied in an ongoing substitute or alternative plan providing Executive
 with substantially the same aggregate economic opportunity on an after-tax
 basis available
 to the Executive immediately prior to the Change in Control) has been made
 with respect to such plan in connection with the Change in Control, or the failure to continue
 Executive’s participation therein on substantially the same basis as existed
 at the time of the Change in Control, which in any such case results in a material
 reduction in Executive’s compensation.


	
 

	
 


	
 

	
          Notwithstanding
 any provision in this Agreement to the contrary, the Executive must give
 written notice of his intention to terminate his employment for Good Reason
 within sixty (60) days after the act or omission which constitutes Good
 Reason, and the Company shall have thirty (30) days from such notice to
 remedy the condition, in which case Good Reason shall no longer exist with regard
 to such condition. Any failure to give such written notice within such period
 will
 result in a waiver by the Executive of his right to terminate for Good Reason
 as a
 result of such act or omission. Any termination hereunder shall occur within
 one hundred twenty (120) days after the Good Reason event occurs.”





                    5.
Except
as set forth herein, the Agreement shall continue in full force and effect in accordance
with its terms.


                    6.
All
questions concerning the construction, validity and interpretation of this Amendment and the
Agreement shall be construed and governed in accordance with the laws of the State of New
York, without reference to the principles of conflict of laws thereof.


                    7.
This
Amendment may be executed simultaneously in two or more counterparts, any one of
which need not contain the signatures of more than one party, but all of which
counterparts taken together will constitute one and the same agreement.


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                    IN
WITNESS WHEREOF, the parties hereto have executed this Amendment as of the date and year
first above written.


	
 

	
 

	
 

	
 


	
 

	
 

	
XL
 CAPITAL LTD


	
 

	
 

	
 


	
 

	
 

	
By: 

	
/s/ Kirstin R. Gould


	
 

	
 

	
 

	



	
 

	
 

	
 

	
 


	
 

	
 

	
GUARANTORS:


	
 

	
 

	
 


	
 

	
 

	
XL
 INSURANCE (BERMUDA) LTD
(formerly XL INSURANCE LTD)


	
 

	
 

	
 


	
 

	
 

	
By:

	
/s/ Kirstin R. Gould


	
 

	
 

	
 

	



	
 

	
 

	
 

	
 


	
 

	
 

	
XL
 RE LTD


	
 

	
 

	
 


	
 

	
 

	
By: 

	
/s/ Kirstin R. Gould


	
 

	
 

	
 

	



	
 

	
 

	
 

	
 


	
READ,
 ACCEPTED & AGREED

	
 

	
 

	
 


	
 

	
 

	
 

	
 


	
/s/ David B. Duclos

	
 

	
 

	
 


	


	
 

	
 

	
 


	
David B. Duclos

	
 

	
 

	
 





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