Document:

Exhibit 10.31

 

Director Compensation Summary

 

Non-management directors receive an annual
retainer of $150,000 per year, $60,000 of which will be paid in cash and
$90,000 of which is paid in stock units or restricted stock (as described
below), though a director may elect to receive all of his compensation in stock
units or restricted stock. Non-management directors also received a one-time
cash award of $25,000 upon their election, concurrent with the closing of the
Company’s initial public offering. The Chairman of the Board receives an
additional $15,000 annual retainer, the Chairman of the Audit Committee
receives an additional $20,000 annual retainer, the Chairman of the
Compensation Committee receives an additional $10,000 annual retainer and the
Chairman of the Nominating and Governance Committee receives an additional
$5,000 annual retainer. Members of the Audit Committee receive an additional
$10,000 annual retainer and members of the Compensation Committee receive an
additional $5,000 annual retainer. Commencing with the May 2005 Annual General
Meeting, the compensation for the Nominating and Governance Committee will be
on the same basis as that of the Compensation Committee, with members of the
Nominating and Governance Committee receiving an additional annual retainer of
$5,000 and the Chairman of the Nominating and Governance Committee receiving an
additional annual retainer of $10,000. The Company will generally not pay a fee
for attendance at board or committee meetings, though the Chief Executive
Officer has the discretion to pay attendance fees of $2,000 for extraordinary
or special meetings. In February 2006, the Chairman of the Audit Committee was
awarded an additional fee of $20,000 for work on a special Audit project.

 

An initial
(one-time) grant of restricted shares with a value of $100,000 was awarded to
each non-management director upon  
closing of the IPO or his initial election. These restricted shares will
vest on the day immediately prior to the third annual shareholders meeting at
which directors are elected following the grant of the shares.

 

Retainer
equity awards were granted upon completion of the IPO and will be granted
annually thereafter (usually on the date of the Company’s annual shareholders’
meeting) in the form of stock units until the share ownership guidelines set
forth in the next paragraph have been met. The first 10,000 stock units awarded
to each director will become non-forfeitable on the day immediately prior to
the first annual shareholders meeting at which directors are elected following
the grant of the units. The issuance of Common Shares for these units will be
mandatorily deferred until six months after termination of the director’s
service on the Board of Directors. After the share ownership guidelines discussed
below are met, directors may elect to receive their annual retainer equity
award in the form of either restricted shares that vest on the day immediately
prior to the first annual shareholders meeting at which directors are elected
following the grant of the shares, or stock units that become non-forfeitable
on the day immediately prior to the first annual shareholders meeting at which
directors are elected following the grant of the units, with the issuance of
Common Shares deferred to a later date chosen by the director. Stock units
cannot be sold or transferred until the Common Shares are issued. Dividend
equivalents will be credited to stock units and reinvested as additional stock
units.

 

 

The Board of
Directors has recommended that each director own at least 10,000 Common Shares
within three years after joining the board. Common Shares represented by stock
units will count toward that guideline, though restricted shares awarded upon a
director’s initial election will not.Exhibit 10.32

 

ASSURED
GUARANTY LTD.

 

DESCRIPTION
OF EXECUTIVE OFFICER CASH COMPENSATION

 

FOR 2005

 

Set
forth below are the 2005 annual salary and bonus of the Chief Executive Officer
and each of the four most highly compensated Executive Officers. The salary of
each Executive Officer listed below are unchanged for 2006.

 

Dominic J. Frederico

 

President and Chief Executive Officer, Assured Guaranty Ltd.

 

	
  Salary

  	
   

  	
  Bonus

  	
   

  
	
  $

  	
  700,000

  	
   

  	
  $

  	
  2,000,000

  	
   

  
						

 

Robert B. Mills

 

Chief Financial Officer, Assured Guaranty Ltd.

 

	
  Salary

  	
   

  	
  Bonus

  	
   

  
	
  $

  	
  500,000

  	
   

  	
  $

  	
  775,000

  	
   

  
						

 

Michael J. Schozer

 

President, Assured Guaranty Corp.

 

	
  Salary

  	
   

  	
  Bonus

  	
   

  
	
  $

  	
  375,000

  	
   

  	
  $

  	
  725,000

  	
   

  
						

 

James M. Michener

 

General Counsel, Assured Guaranty Ltd.

 

	
  Salary

  	
   

  	
  Bonus

  	
   

  
	
  $

  	
  375,000

  	
   

  	
  $

  	
  600,000

  	
   

  
						

 

Robert A. Bailenson

 

Chief Accounting Officer, Assured Guaranty Ltd.

 

	
  Salary

  	
   

  	
  Bonus

  	
   

  
	
  $

  	
  300,000

  	
   

  	
  $

  	
  260,000

  	
   

  
						

 

 

Messrs. Frederico, Mills and Michener have
employment agreements with the Company and are entitled to certain perquisites,
such as housing allowance, family travel benefit, car allowance, reimbursement
of U.S. social security and Medicare taxes, financial and tax planning and club
dues. Mr. Schozer is also a party to an employment agreement with Assured
Guaranty Corp. and is entitled to certain perquisites, such as financial and
tax planning and club dues.

 

The CEO and other Executive Officers are also
participants in defined contribution pension plans maintained by the Company
and its subsidiaries.Exhibit 10.34

 

To Be Used With Employment Agreement

 

Non-Qualified Stock
Option Agreement under

Assured Guaranty Ltd. 2004 Long-Term Incentive Plan

 

THIS AGREEMENT, entered into as of the Grant Date (as
defined in paragraph 1), by and between the Participant and Assured Guaranty
Ltd. (the “Company”):

 

WITNESSETH THAT:

 

WHEREAS, the Company maintains the Assured Guaranty
Ltd. 2004 Long-Term Incentive Plan (the “Plan”), and the Participant has been
selected by the committee administering the Plan (the “Committee”) to receive a
Non-Qualified Stock Option Award under the Plan; and

 

WHEREAS, the Participant and the Company agree that
this Award is in full satisfaction of the stock option awards to be granted to
the Participant pursuant to paragraph 7(a) of the employment agreement between
the Company and the Participant dated April 28, 2004;

 

NOW, THEREFORE, IT IS AGREED, by and between the
Company and the Participant, as follows:

 

1. Terms
of Award. The following words and phrases used in this Agreement
shall have the meanings set forth in this paragraph 1:

 

(a)                                  The
“Participant” is                             .

 

(b)                                 The
“Grant Date” is                                                                             .

 

(c)                                  The
number of “Covered Shares” shall be                        
shares of Stock.

 

(d)                                 The
“Exercise Price” is $                
per share.

 

Other words and phrases used in this Agreement are
defined pursuant to paragraph 17 or elsewhere in this Agreement.

 

2. Non-Qualified Stock
Option. This Agreement specifies the terms of the option (the “Option”)
granted to the Participant to purchase the number of Covered Shares of Stock at
the Exercise Price per share as set forth in paragraph 1. The Option is not
intended to constitute an “incentive stock option” as that term is used in Code
section 422.

 

3. Date
of Exercise. Subject to the limitations of this Agreement, each
Installment of Covered Shares of the Option shall be exercisable on and after
the Vesting Date for such Installment as described in the following schedule
(but only if the Date of Termination has not occurred before the Vesting Date):

 

 

	
  INSTALLMENT

  	
   

  	
  VESTING DATE APPLICABLE

  TO INSTALLMENT

  
	
  1/3 of Covered Shares

  	
   

  	
  One year anniversary of
  the Grant Date

  
	
  1/3 of Covered Shares

  	
   

  	
  Two year anniversary of
  the Grant Date

  
	
  1/3 of Covered Shares

  	
   

  	
  Three year anniversary
  of the Grant Date

  

 

Notwithstanding the foregoing provisions of this
paragraph 3, the Option shall become vested and exercisable as follows:

 

(a)                                  The
Option shall become fully exercisable upon the Date of Termination, if the Date
of Termination occurs by reason of the Participant’s death or Disability.

 

(b)                                 The
Option shall become fully exercisable upon a Change in Control that occurs on
or before the Date of Termination.

 

(c)                                  If
the Option is not fully exercisable upon the Participant’s Date of Termination,
and the Participant’s Date of Termination occurs because of Retirement, the
Participant shall be treated as though employed by the Company and Subsidiaries
after the Participant’s actual Date of Termination until the Vesting Date has
occurred with respect to all of the Covered Shares.

 

(d)                                 If
the Option is not fully exercisable upon the Participant’s Date of Termination,
and the Participant’s Date of Termination occurs by virtue of a Termination
Without Cause, then for purposes of applying the foregoing vesting schedule,
and for purposes of determining the Expiration Date of the Option, the
Participant shall be treated as though employed by the Company and Subsidiaries
after the Participant’s actual Date of Termination until the later of the date
on which the Participant ceases receiving severance payments under the
Employment Agreement or the date on which the term of the Employment Agreement
ends. A notice of termination shall be deemed to constitute a notice of
non-renewal of the Employment Agreement term under the provisions of the
Employment Agreement to be effective as of the earliest date permitted under
the Employment Agreement. The terms “Cause” and “Terminated Without Cause”
shall be defined as set forth in the Employment Agreement. Notwithstanding the
foregoing, if the Executive’s employment is Terminated without Cause, the
provisions of this paragraph (d) shall apply only if the Executive executes and
returns to the Company a general release and waiver of all claims against the
Company as required under the Employment Agreement.

 

Subject to paragraphs (c) and (d) above, the Option
may be exercised on or after the Date of Termination only as to that portion of
the Covered Shares for which it was exercisable immediately prior to (or became
exercisable on) the Date of Termination. Notwithstanding the foregoing
provisions of this paragraph 3, as of the Participant’s Date of Termination for
Cause, the Option shall be canceled as to any Covered Shares as to which it has
not previously been exercised.

 

2

 

4. Expiration.
The Option shall not be exercisable after the Company’s close of business on
the last business day that occurs prior to the Expiration Date. The “Expiration
Date” shall be the earliest to occur of:

 

(a)                                  the
ten-year anniversary of the Grant Date;

 

(b)                                 if
the Participant’s Date of Termination occurs by reason of death or Disability,
the three-year anniversary of such Date of Termination;

 

(c)                                  if
the Participant’s Date of Termination occurs for Cause, the Date of
Termination;

 

(d)                                 if
the Participant’s Date of Termination occurs because of Retirement or because
of a Termination Without Cause, the ten-year anniversary of the Grant Date; or

 

(e)                                  if
the Participant’s Date of Termination occurs for any reason other than those
listed in subparagraph (b), (c) or (d) of this paragraph 4, the 90 day
anniversary of such Date of Termination.

 

Notwithstanding the foregoing provisions of this
paragraph 4, if a Change in Control occurs on or before the Participant’s Date
of Termination, the Expiration Date shall be the ten-year anniversary of the
Grant Date.

 

5. Method
of Option Exercise. Subject to this Agreement and the Plan, the
Option may be exercised in whole or in part by filing a written notice with the
Secretary of the Company at its corporate headquarters prior to the Company’s
close of business on the last business day that occurs prior to the Expiration
Date. Such notice shall specify the number of shares of Stock which the
Participant elects to purchase, and shall be accompanied by payment of the
Exercise Price for such shares of Stock indicated by the Participant’s election.
Payment shall be by cash or by check payable to the Company. Except as
otherwise provided by the Committee before the Option is exercised: (i) all or
a portion of the Exercise Price may be paid by the Participant by delivery of
shares of Stock owned by the Participant and acceptable to the Committee having
an aggregate Fair Market Value (valued as of the date of exercise) that is
equal to the amount of cash that would otherwise be required; and (ii) the
Participant may pay the Exercise Price by authorizing a third party to sell
shares of Stock (or a sufficient portion of the shares) acquired upon exercise
of the Option and remit to the Company a sufficient portion of the sale
proceeds to pay the entire Exercise Price and any tax withholding resulting
from such exercise. The Option shall not be exercisable if and to the extent
the Company determines that such exercise would violate applicable state or
Federal securities laws or the rules and regulations of any securities exchange
on which the Stock is traded. If the Company makes such a determination, it
shall use all reasonable efforts to obtain compliance with such laws, rules and
regulations. In making any determination hereunder, the Company may rely on the
opinion of counsel for the Company.

 

6. Withholding.
All deliveries and distributions under this Agreement are subject to
withholding of all applicable taxes. At the election of the Participant, and
subject to such rules and limitations as may be established by the Committee
from time to time, such withholding obligations may be satisfied through the
surrender of shares of Stock which the Participant already owns, or to which
the Participant is otherwise entitled under the Plan; provided, however, that
such shares may be used to satisfy not more than the Company’s minimum

 

3

 

statutory
withholding obligation (based on minimum statutory withholding rates for
Federal and state tax purposes, including payroll taxes, that are applicable to
such supplemental taxable income).

 

7. Transferability.
Except as otherwise provided by the Committee, the Option is not transferable
other than as designated by the Participant by will or by the laws of descent
and distribution, and during the Participant’s life, may be exercised only by
the Participant.

 

8. Cancellation and
Rescission of Options.

 

(a)                                  The
Committee may cancel, rescind, suspend, withhold or otherwise limit or restrict
the Option at any time if the Participant engages in any “Detrimental Activity.”

 

(b)                                 Upon
exercise of the Option, the Participant shall certify, to the extent provided
by the Committee, in a manner acceptable to the Committee, that the Participant
is not engaging and has not engaged in any Detrimental Activity. In the event a
Participant has engaged in any Detrimental Activity prior to, or during the six
months after, any exercise of the Option, such exercise may be rescinded by the
Committee within two years thereafter. In the event of any such rescission, the
Participant shall pay to the Company the amount of any gain realized as a
result of the rescinded exercise, in such manner and on such terms and
conditions as may be required, and the Company shall be entitled to set-off
against the amount of any such gain any amount owed to the Participant by the
Company and/or Subsidiary.

 

9. Heirs
and Successors. This Agreement shall be binding upon, and inure to
the benefit of, the Company and its successors and assigns, and upon any person
acquiring, whether by merger, consolidation, purchase of assets or otherwise,
all or substantially all of the Company’s assets and business. If any rights
exercisable by the Participant or benefits deliverable to the Participant under
this Agreement have not been exercised or delivered, respectively, at the time
of the Participant’s death, such rights shall be exercisable by the Designated
Beneficiary, and such benefits shall be delivered to the Designated
Beneficiary, in accordance with the provisions of this Agreement and the Plan. The
“Designated Beneficiary” shall be the beneficiary or beneficiaries designated
by the Participant in a writing filed with the Committee in such form and at
such time as the Committee shall require. If a deceased Participant fails to
designate a beneficiary, or if the Designated Beneficiary does not survive the
Participant, any rights that would have been exercisable by the Participant and
any benefits distributable to the Participant shall be exercised by or
distributed to the legal representative of the estate of the Participant. If a
deceased Participant designates a beneficiary and the Designated Beneficiary
survives the Participant but dies before the Designated Beneficiary’s exercise
of all rights under this Agreement or before the complete distribution of
benefits to the Designated Beneficiary under this Agreement, then any rights
that would have been exercisable by the Designated Beneficiary shall be
exercised by the legal representative of the estate of the Designated
Beneficiary, and any benefits distributable to the Designated Beneficiary shall
be distributed to the legal representative of the estate of the Designated
Beneficiary.

 

10. Administration. The authority to manage and
control the operation and administration of this Agreement shall be vested in
the Committee, and the Committee shall have

 

4

 

all
powers with respect to this Agreement as it has with respect to the Plan. Any
interpretation of this Agreement by the Committee and any decision made by it
with respect to this Agreement is final and binding on all persons. The
Committee shall have the authority to obtain such information from the
Participant (including tax return information) as it determines may be
necessary to confirm that the Participant is in compliance with the
requirements applicable to Detrimental Activity, and if the Participant fails
to provide such information, the Committee may conclude that the Participant is
not in compliance with such requirements.

 

11. Plan Governs. Notwithstanding anything in this
Agreement to the contrary, this Agreement shall be subject to the terms of the
Plan, a copy of which may be obtained by the Participant from the office of the
Secretary of the Company; and this Agreement is subject to all interpretations,
amendments, rules and regulations promulgated by the Committee from time to
time pursuant to the Plan.

 

12. Not An Employment Contract. The Option will not
confer on the Participant any right with respect to continuance of employment
or other service with the Company or any Subsidiary, nor will it interfere in
any way with any right the Company or any Subsidiary would otherwise have to
terminate or modify the terms of such Participant’s employment or other service
at any time.

 

13. Notices. Any written notices provided for in this
Agreement or the Plan shall be in writing and shall be deemed sufficiently
given if either hand delivered or if sent by fax or overnight courier, or by
postage paid first class mail. Notices sent by mail shall be deemed received
three business days after mailing but in no event later than the date of actual
receipt. Notices shall be directed, if to the Participant, at the Participant’s
address indicated by the Company’s records, or if to the Company, at the
Company’s principal executive office.

 

14. Fractional Shares. In lieu of issuing a fraction
of a share upon any exercise of the Option, resulting from an adjustment of the
Option pursuant to the Plan or otherwise, the Company will be entitled to pay
to the Participant an amount equal to the fair market value of such fractional
share.

 

15. No Rights As Shareholder. The Participant shall
not have any rights of a shareholder with respect to the shares subject to the
Option, until a stock certificate has been duly issued following exercise of
the Option as provided herein.

 

16. Amendment. This Agreement may be amended in
accordance with the provisions of the Plan, and may otherwise be amended by
written agreement of the Participant and the Company without the consent of any
other person.

 

17. Definitions. For purposes of this Agreement,
words and phrases shall be defined as follows:

 

(a)                                  Change
in Control. The term “Change in Control” shall be defined as set forth in
the Plan.

 

(b)                                 Date of Termination. A Participant’s “Date of
Termination” means, with respect to an employee, the date on which the
Participant’s employment with the Company and

 

5

 

Subsidiaries
terminates for any reason, and with respect to a Director, the date immediately
following the last day on which the Participant serves as a Director; provided
that a Date of Termination shall not be deemed to occur by reason of a
Participant’s transfer of employment between the Company and a Subsidiary or
between two Subsidiaries; further provided that a Date of Termination shall not
be deemed to occur by reason of a Participant’s cessation of service as a
Director if immediately following such cessation of service the Participant
becomes or continues to be employed by the Company or a Subsidiary, nor by
reason of a Participant’s termination of employment with the Company or a
Subsidiary if immediately following such termination of employment the
Participant becomes or continues to be a Director; and further provided that a
Participant’s employment shall not be considered terminated while the
Participant is on a leave of absence from the Company or a Subsidiary approved
by the Participant’s employer.

 

(c)                                  Detrimental
Activity. The term “Detrimental Activity” shall mean (i) a violation of
paragraph 11 of the Employment Agreement (relating to competition) during the
period in which such activity is prohibited under the Employment Agreement; or
(ii) a violation of paragraph 12 of the Employment Agreement (relating to
confidentiality).

 

(d)                                 Director.
The term “Director” means a member of the Board of Directors of Assured
Guaranty Ltd., who may or may not be an employee of the Company or a
Subsidiary.

 

(e)                                  Disability. The Participant shall be considered
to have a “Disability” during the period in which the Participant is unable, by
reason of a medically determinable physical or mental impairment, to engage in
any substantial gainful activity, which condition, in the opinion of a
physician selected by the Committee, is expected to have a duration of not less
than 120 days.

 

(f)                                    Employment Agreement. “Employment
Agreement” shall mean the agreement between the Participant and the Company
dated April 28, 2004 or any successor agreement thereto.

 

(g)                                 Retirement. “Retirement” of a Participant shall
mean with respect to an employee of the Company or a Subsidiary, the occurrence
of a Participant’s Date of Termination after the Participant has completed
three years of service and attained age 55. For purposes of this definition,
years of service shall be determined in accordance with rules established by
the Committee, and shall take into account service with the Company and its
Subsidiaries, as well as service with ACE Limited and its subsidiaries
occurring prior to the initial public offering of stock of the Company.

 

(h)                                 Plan Definitions. Except where the context
clearly implies or indicates the contrary, a word, term, or phrase used in the
Plan is similarly used in this Agreement.

 

6

 

IN WITNESS WHEREOF, the Participant has executed the
Agreement, and the Company has caused these presents to be executed in its name
and on its behalf, all as of the Grant Date.

 

	
  Assured Guaranty Ltd.

  	
   

  
	
   

  	
   

  
	
  By:

  	
   

  	
   

  
	
  Its:

  	
   

  	
   

  
	
   

  	
   

  
	
  Participant

  	
   

  
	
   

  	
   

  
	
   

  	
   

  

 

7

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