Document:

Exhibit 10.4

 

Restricted Stock Unit Agreement for

Outside Directors under

Assured Guaranty Ltd. 2004 Long-Term Incentive Plan(1)

 

THIS
AGREEMENT, entered into as of the Grant Date (as defined in paragraph 1), by
and between the Director 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 Director has been selected by the committee administering
the Plan (the “Committee”) to receive a Restricted Stock Unit Award under the
Plan; and

 

NOW,
THEREFORE, IT IS AGREED, by and between the Company and the Director, 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
“Director” is                           .

 

(b)                                 The
“Grant Date” is                                                                                     .

 

Other words and phrases
used in this Agreement are defined pursuant to paragraph 14 or elsewhere in
this Agreement.

 

2.  Restricted Stock Unit Award.  This Agreement specifies the terms of the “Restricted
Stock Unit Award” granted to the Director. 
Subject to the terms of this Agreement and the Plan, the Director is
hereby granted the right to receive                    shares
(“Restricted Stock Units”) at the “Delivery Date,” which shall be                            .(2)  [Alternate Delivery Date:  (must use when share
guidelines have not been met) on or about the sixth month
anniversary of the date the Director ceases to be a director of Assured
Guaranty Ltd.]

 

3.  Restricted Period.  Subject to the limitations of this Agreement,
the “Restricted Period” for the Restricted Stock Units shall begin on the Grant
Date and end on the day immediately prior to the next annual shareholders
meeting during which elections for directors are held following the Grant Date.

 

4.  Transfer and Forfeiture of Shares.  If the Restricted Period with respect to the
Restricted Stock Units ends on or before the date the Director ceases to be a
director of the Company, then at the end of such Restricted Period, the
Restricted Stock Units shall be fully vested, and shall be transferred to the
Director free of all restrictions on the Delivery Date.  If the Restricted Period with respect to the
Restricted Stock Units does not end on or before the date

 

(1)  This form
is not for use with the initial one-time award valued at $100,000.

 

(2)  This
should be a date occurring after the vesting date.

 

 

the Director ceases to be
a director of the Company, then as of the date the Director ceases to be a
director of the Company, the Director shall forfeit all Restricted Stock Units.

 

5.  Transferability.  Restricted Stock Units may not be sold,
assigned, transferred, pledged or otherwise encumbered prior to the Delivery
Date.

 

6.  Dividends. 
The Director will be credited with additional Restricted Stock Units to
reflect dividends payable with respect to shares during the period between the
Grant Date and the Delivery Date, with the increase in the number of Restricted
Stock Units equal to the number of shares which could be purchased with the
dividends (assuming each Restricted Stock Unit was a share), based on the value
of such share at the time such dividends are paid.  The Restricted Stock Units credited on
account of the preceding sentence (other than extraordinary dividends, as
determined by the Committee) shall be fully vested at the time of crediting to
the Director, and distribution shall be made with respect to such Restricted
Stock Units on the Delivery Date. 
Extraordinary dividends shall be vested in accordance with the same schedule as
the Restricted Stock Units to which such extraordinary dividends are
attributable.  No dividends shall be
credited to or for the benefit of the Director for Restricted Stock Units with
respect to record dates occurring prior to the Grant Date, or with respect to
record dates occurring on or after the date, if any, on which the Director has
forfeited those Restricted Stock Units.

 

7.  Director’s Rights to Shares.  Prior to the Delivery Date, (a) the Director
shall not be treated as owner of the shares, shall not have any rights as a
shareholder as to those shares, and shall have only a contractual right to
receive them, unsecured by any assets of the Company or its subsidiaries; (b)
the Director shall be not permitted to vote the Restricted Stock Units; and (c)
the Director’s right to receive such shares will be subject to the adjustment
provisions relating to mergers, reorganizations, and similar events set forth
in the Plan.

 

8.  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 benefits deliverable to the Director
under this Agreement have not been delivered at the time of the Director’s
death, 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 Director in a writing filed with
the Committee in such form and at such time as the Committee shall
require.  If a deceased Director fails to
designate a beneficiary, or if the Designated Beneficiary does not survive the
Director, any rights that would have been exercisable by the Director and any benefits
distributable to the Director shall be distributed to the legal representative
of the estate of the Director.  If a
deceased Director designates a beneficiary and the Designated Beneficiary
survives the Director but dies before the complete distribution of benefits to
the Designated Beneficiary under this Agreement, then any benefits
distributable to the Designated Beneficiary shall be distributed to the legal
representative of the estate of the Designated Beneficiary.

 

9.  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 all powers with respect to this
Agreement as it has with respect to the Plan. 
Any interpretation of this

 

2

 

Agreement by the
Committee and any decision made by it with respect to this Agreement is final
and binding on all persons.

 

10.  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 Director 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.

 

11.  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 Director, at the Director’s address
indicated by the Company’s records, or if to the Company, at the Company’s
principal executive office.

 

12.  Fractional Shares.  In lieu of issuing a fraction of a share,
resulting from an adjustment of the Restricted Stock Unit Award pursuant to the
Plan or otherwise, the Company will be entitled to pay to the Director an
amount equal to the fair market value of such fractional share.

 

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

 

14.  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.

 

IN
WITNESS WHEREOF, the Director 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:

  	
   

  	
   

  
	
   

  	
   

  
	
  Director

  	
   

  
	
   

  	
   

  
	
   

  	
   

  

 

3Exhibit 10.5

 

Restricted Stock 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 Restricted Stock Award
under the Plan;

 

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.

 

Other words and phrases
used in this Agreement are defined pursuant to paragraph 18 or elsewhere in
this Agreement.

 

2.  Restricted Stock Award.  This Agreement specifies the terms of the “Restricted
Stock Award” granted to the Participant.

 

3.  Restricted Period.  Subject to the limitations of this Agreement,
the “Restricted Period” for each Installment of Covered Shares of the
Restricted Stock Award shall begin on the Grant Date and end as described in
the following schedule (but only if the Date of Termination has not
occurred before the end of the Restricted Period):

 

	
  INSTALLMENT

  	
   

  	
  RESTRICTED PERIOD WILL END ON:

  
	
  1⁄4 of Covered Shares

  	
   

  	
  One year anniversary of the Grant Date

  
	
  1⁄4 of Covered Shares

  	
   

  	
  Two year anniversary of the Grant Date

  
	
  1⁄4 of Covered Shares

  	
   

  	
  Three year anniversary of the Grant Date

  
	
  1⁄4 of Covered Shares

  	
   

  	
  Four year anniversary of the Grant Date

  

 

The Restricted Period
shall end prior to the date specified in the foregoing schedule to the
extent set forth below:

 

 

(a)                                  For
Installments as to which the Restricted Period has not ended prior to the Date
of Termination, the Restricted Period for such Installments shall end upon the
Participant’s Date of Termination, if the Date of Termination occurs by reason
of the Participant’s Disability or death.

 

(b)                                 For
Installments as to which the Restricted Period has not ended prior to the date
of a Change in Control, the Restricted Period for such Installments shall end
upon a Change in Control, provided that such Change in Control occurs on or
before the Date of Termination.

 

(c)                                  For
Installments as to which the Restricted Period has not ended prior to the Date
of Termination, if 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
Restricted Period has ended with respect to all Installments.

 

4.  Transfer and Forfeiture of Shares.  If the Restricted Period with respect to any
Installment of the Covered Shares ends on or before the Participant’s Date of
Termination, then at the end of such Restricted Period, that Installment of
Covered Shares shall be transferred to the Participant free of all restrictions
(except for restrictions described in paragraph 10).  If the Restricted Period with respect to any
Installments does not end on or before the Participant’s Date of Termination,
then as of the Participant’s Date of Termination, the Participant shall forfeit
such Installments.  However, the
Committee, in its sole discretion, may accelerate the end of the Restricted
Period or provide for the vesting of the Covered Shares under circumstances
that such vesting would not otherwise occur in its sole discretion, based on
such factors as the Committee deems appropriate.

 

5.  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
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).

 

6.  Transferability.  Except as otherwise provided by the
Committee, the Restricted Stock Award may not be sold, assigned, transferred,
pledged or otherwise encumbered during the Restricted Period.

 

7.  Dividends.  The Participant shall not be prevented from
receiving dividends and distributions paid on the Covered Shares of Restricted
Stock merely because those shares are subject to the restrictions imposed by
this Agreement and the Plan; provided, however that no dividends or
distributions shall be payable to or for the benefit of the Participant with
respect to record dates for such dividends or distributions for any Covered
Shares occurring on or after the date, if any, on which the Participant has
forfeited those shares.

 

2

 

8.  Voting.  The Participant shall not be prevented from
voting the Restricted Stock Award merely because those shares are subject to
the restrictions imposed by this Agreement and the Plan; provided, however,
that the Participant shall not be entitled to vote Covered Shares with respect
to record dates for any Covered Shares occurring on or after the date, if any,
on which the Participant has forfeited those shares.

 

9.  Registration of Restricted Stock Award.  Each certificate issued in respect of the
Covered Shares awarded under this Agreement shall be registered in the name of
the Participant.

 

10.  Cancellation and Rescission of Restricted
Stock Award.

 

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

 

(b)                                 At
the end of the Restricted Period with respect to an Installment and prior to
the transfer of the Covered Shares to the Participant, the Participant shall
certify, to the extent required 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, the vesting of any Installment of Covered Shares, such vesting
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 vesting, in such manner and on such terms and conditions as may be
required by the Company, 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.

 

11.  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 benefits deliverable to the
Participant under this Agreement have not been delivered at the time of the
Participant’s death, 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 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 complete distribution of benefits to the Designated Beneficiary
under this Agreement, then any benefits distributable to the Designated
Beneficiary shall be distributed to the legal representative of the estate of
the Designated Beneficiary.

 

12.  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 all powers with respect to this
Agreement as it has with respect to the Plan. 
Any interpretation of

 

3

 

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.

 

13.  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.

 

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

 

15.  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.

 

16.  Fractional Shares.  In lieu of issuing a fraction of a share,
resulting from an adjustment of the Restricted Stock Award 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.

 

17.  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.

 

18.  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 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

 

4

 

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) the rendering of services for any organization or
engaging directly or indirectly in any business which is or becomes competitive
with the Company or the Subsidiaries (including, without limitation, Financial
Security Assurance Inc., MBIA, Inc., AMBAC Financial Group Inc., and Radian
Group Inc.), or which organization or business, or the rendering of services to
such organization or business, is or becomes otherwise prejudicial to or in
conflict with the interests of the Company or the Subsidiaries; (ii) the
disclosure to anyone outside the Company or the Subsidiaries, or the use in
other than the Company’s or the Subsidiaries’ business, without prior written
authorization from the Company or the Subsidiaries, of any confidential
information or material, relating to the business of the Company or the
Subsidiaries, acquired by the Participant either during or after employment
with the Company or the Subsidiaries; (iii) a violation of any rules, policies,
procedures or guidelines of the Company or the Subsidiaries, including but not
limited to the Company’s business conduct guidelines; (iv) any attempt directly
or indirectly to induce any employee of the Company to be employed or perform
services elsewhere or any attempt directly or indirectly to solicit the trade
or business of any current or prospective customer, supplier or partner of the
Company; (v) the Participant being convicted of, or entering a guilty plea with
respect to, a crime, whether or not connected with the Company; or (vi) any
other conduct or act determined to be injurious, detrimental or prejudicial to
any interest of the Company. 
Notwithstanding the foregoing, activity occurring after the Date of
Termination shall constitute Detrimental Activity only if it is described in
clause (i) (relating to competition), (ii) (relating to confidentiality), or
(iv) (relating to solicitation) above.

 

(d)                                 Director.  The term “Director” means a member of the
Board, 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)                                    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 with the consent of the Participant’s
employer after the Participant has completed five 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

 

5

 

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.

 

(g)                                 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.

 

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

  	
   

  
	
   

  	
   

  
	
   

  	
   

  

 

6

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