Document:

Exhibit 10.9.7

 

ARCH CAPITAL GROUP LTD.

Restricted Share Agreement

 

THIS AGREEMENT, dated as of                                 ,
between Arch Capital Group Ltd. (the “Company”), a Bermuda company, and                             
(the “Employee”).

 

WHEREAS, the Employee has been granted the following
award under the Company’s 2007 Long Term Incentive and Share Award Plan (the “Plan”);

 

NOW, THEREFORE, in consideration of the premises and
mutual covenants contained herein, the parties hereto agree as follows.

 

1.                                       Award of Shares.
Pursuant to the provisions of the Plan, the terms of which are
incorporated herein by reference, the Employee is hereby awarded                     
Restricted Shares (the “Award”), subject to the terms and conditions herein set
forth. Capitalized terms used herein and not defined shall have the meanings
set forth in the Plan. In the event of any conflict between this Agreement and
the Plan, the Plan shall control.

 

2.                                       Terms and
Conditions. It is understood and agreed that the Award of
Restricted Shares evidenced hereby is subject to the following terms and
conditions:

 

(a)                                  Vesting of Award. Subject to Section 2(b) below
and the other terms and conditions of this Agreement, this Award shall become
vested in three equal annual installments on the first, second and third
anniversaries of the date hereof. Unless otherwise provided by the Company, all
dividends and other amounts receivable in connection with any adjustments to
the Shares under Section 4(c) of the Plan shall be subject to the
vesting schedule in this Section 2(a).

 

(b)                                 Termination of Service;
Forfeiture of Unvested Shares.

 

(i)                                     In the event the Employee
ceases to be an employee of the Company prior to the date the Restricted Shares
otherwise become vested due to his or her death or Permanent Disability (as
defined in the Company’s Incentive Compensation Plan on the date hereof), the
Restricted Shares shall become immediately vested in full upon such termination
of employment.

 

(ii)                                  In the event of termination
of employment (other than by the Company for Cause, as such term is defined in
the Company’s Incentive Compensation Plan on the date hereof) after the
attainment of Retirement Age (as defined in the Company’s Incentive
Compensation Plan on the date hereof), the Restricted Shares shall continue to
vest on the schedule set forth in Section 2(a) above so long as
the Employee does not engage in any activity in competition with any activity
of the Company or any of its Subsidiaries other than serving on the board of
directors (or similar governing body) of another company or as a consultant for
no more than 26 weeks per calendar year (“Competitive Activity”).

 

 

In
the event the Employee engages in a Competitive Activity, any unvested
Restricted Shares shall be forfeited by the Employee and become the property of
the Company.

 

(iii)                               In the event the Employee
ceases to be an employee of the Company after a Change in Control (as defined
below) due to termination (A) by the Company not for Cause or (B) by
the Employee for Good Reason (as defined in the Employment Agreement, dated as
of                   ,
between the Employee and                    ),
in either case, on or before the second anniversary of the occurrence of the
Change in Control, the Restricted Shares, to the extent not already vested,
shall become immediately vested in full upon such termination of employment.

 

(iv)                              If the Employee ceases to be
an Employee of the Company for any other reason prior to the date the
Restricted Shares become vested, the Award shall be forfeited by the Employee
and become the property of the Company; provided that, in the event of a
Redundancy (as defined below), the Committee, in its sole discretion, may, in
accordance with its authority under the Plan, determine that the Restricted Shares,
to the extent not vested, shall become vested upon such termination of
employment.

 

(v)                                 For purposes of this
Agreement, service with any of the Company’s Subsidiaries (as defined in the
Plan) shall be considered to be service with the Company.

 

(vi)                              “Change in
Control” shall mean:

 

(A)      any person (within the
meaning of the Securities Exchange Act of 1934, as amended (the “Exchange Act”),
other than a Permitted Person, is or becomes the “beneficial owner” (as defined
in Rule 13d-3 under the Exchange Act), directly or indirectly, of Voting
Securities representing 50% or more of the total voting power or value of all
the then outstanding Voting Securities; or

 

(B)        the individuals who, as of
the date hereof, constitute the Board of Directors of the Company (the “Board”)
together with those who become directors subsequent to such date and whose
recommendation, election or nomination for election to the Board was approved
by a vote of at least a majority of the directors then still in office who
either were directors as of such date or whose recommendation, election or
nomination for election was previously so approved, cease for any reason to
constitute a majority of the members of the Board; or

 

2

 

(C)        the consummation of a
merger, consolidation, recapitalization, liquidation, sale or disposition by
the Company of all or substantially all of the Company’s assets, or
reorganization of the Company, other than any such transaction which would
(x) result in more than 50% of the total voting power and value
represented by the voting securities of the surviving entity outstanding
immediately after such transaction being beneficially owned by the former
shareholders of the Company and (y) not otherwise be deemed a Change in
Control under subparagraphs (A) or (B) of this paragraph.

 

“Permitted Persons” means (A) the Company; (B) any
Related Party; (C) Hellman & Friedman or any of its subsidiaries
or investment funds managed or controlled by Hellman & Friedman; (D) Warburg
Pincus or any of its subsidiaries or any investment funds managed or controlled
by Warburg Pincus or any of its subsidiaries; or (E) any group (as defined
in Rule 13b-3 under the Exchange Act) comprised of any or all of the
foregoing.

 

“Related Party” means (A) a majority-owned
subsidiary of the Company; (B) a trustee or other fiduciary holding
securities under an employee benefit plan of the Company or any majority-owned
subsidiary of the Company; or (C) any entity, 50% or more of the voting
power of which is owned directly or indirectly by the shareholders of the
Company in substantially the same proportion as their ownership of Voting
Securities immediately prior to the transaction.

 

“Voting Security” means any security of the Company
which carries the right to vote generally in the election of directors.

 

(vii)                           “Redundancy”
shall mean termination of employment by the Company due to its need to reduce
the size of its workforce, including due to closure of a business or a
particular workplace or change in business process. Whether a termination of
employment is due to a “redundancy” shall be determined by the Committee in its
sole and absolute discretion, such determination being final and binding on all
parties hereto and all persons claiming through, in the name of or on behalf of
such parties.

 

3

 

(c)                                  Certificates. Each
certificate issued in respect of Restricted Shares awarded hereunder shall be
deposited with the Company, or its designee, together with, if requested by the
Company, a stock power executed in blank by the Employee, and shall bear a
legend disclosing the restrictions on transferability imposed on such
Restricted Shares by this Agreement (the “Restrictive Legend”). Upon the
vesting of Restricted Shares pursuant to Section 2 hereof and the
satisfaction of any withholding tax liability pursuant to Section 5
hereof, the certificates evidencing such vested Shares, not bearing the
Restrictive Legend, shall be delivered to the Employee.

 

(d)                                 Rights of a Stockholder. Prior to the
time a Restricted Share is fully vested hereunder, the Employee shall have no
right to transfer, pledge, hypothecate or otherwise encumber such Restricted
Share. During such period, the Employee shall have all other rights of a
stockholder, including, but not limited to, the right to vote and to receive
dividends (subject to Section 2(a) hereof) at the time paid on such
Restricted Shares.

 

(e)                                  No Right to Continued
Employment. This Award shall not confer upon the Employee any right
with respect to continuance of employment by the Company nor shall this Award
interfere with the right of the Company to terminate the Employee’s employment
at any time.

 

3.                                       Transfer of
Shares. The Shares delivered hereunder, or any interest
therein, may be sold, assigned, pledged, hypothecated, encumbered, or
transferred or disposed of in any other manner, in whole or in part, only in
compliance with the terms, conditions and restrictions as set forth in the
governing instruments of the Company, applicable United States federal and
state securities laws or any other applicable laws or regulations and the terms
and conditions hereof.

 

4.                                       Expenses of
Issuance of Shares. The issuance of stock certificates hereunder shall
be without charge to the Employee. The Company shall pay any issuance, stamp or
documentary taxes (other than transfer taxes) or charges imposed by any
governmental body, agency or official (other than income taxes) or by reason of
the issuance of Shares.

 

5.                                       Withholding. No later than
the date of vesting of (or the date of an election by the Employee under Section 83(b) of
the Code with respect to) the Award granted hereunder, the Employee shall pay
to the Company or make arrangements satisfactory to the Committee regarding
payment of any federal, state or local taxes of any kind required by law to be
withheld at such time with respect to such Award and the Company shall, to the
extent permitted or required by law, have the right to deduct from any payment
of any kind otherwise due to the Employee, federal, state and local taxes of
any kind required by law to be withheld at such time.

 

6.                                       References. References
herein to rights and obligations of the Employee shall apply, where
appropriate, to the Employee’s legal representative or estate without 

 

4

 

regard
to whether specific reference to such legal representative or estate is
contained in a particular provision of this Agreement.

 

7.                                       Notices. Any notice
required or permitted to be given under this Agreement shall be in writing and
shall be deemed to have been given when delivered personally or by courier, or
sent by certified or registered mail, postage prepaid, return receipt
requested, duly addressed to the party concerned at the address indicated below
or to such changed address as such party may subsequently by similar
process give notice of:

 

If to the Company:

 

Arch Capital Group Ltd.

Wessex House, 4th Floor

45 Reid Street

Hamilton HM 12 Bermuda

Attn.: Secretary

 

If to the Employee:

 

To the last address delivered to the Company by the

Employee in the manner set forth herein.

 

8.                                       Governing Law. This Agreement
shall be governed by and construed in accordance with the laws of New York,
without giving effect to principles of conflict of laws.

 

9.                                       Entire
Agreement. This Agreement and the Plan constitute the entire
agreement among the parties relating to the subject matter hereof, and any
previous agreement or understanding among the parties with respect thereto is
superseded by this Agreement and the Plan.

 

10.                                 Counterparts. This Agreement may be
executed in two counterparts, each of which shall constitute one and the same
instrument.

 

5

 

IN WITNESS WHEREOF, the undersigned have executed
this Agreement as of the date first above written.

 

	
   

  	
  ARCH CAPITAL GROUP LTD.

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

6Exhibit 10.9.8

 

ARCH CAPITAL GROUP LTD.

Restricted Share Agreement

 

THIS
AGREEMENT, dated as of                     ,
between Arch Capital Group Ltd. (the “Company”), a Bermuda company, and                       (the
“Employee”).

 

WHEREAS,
the Employee has been granted the following award under the Company’s 2007 Long
Term Incentive and Share Award Plan (the “Plan”);

 

NOW,
THEREFORE, in consideration of the premises and mutual covenants contained
herein, the parties hereto agree as follows.

 

1.                                       Award of Shares.  Pursuant to the provisions
of the Plan, the terms of which are incorporated herein by reference, the
Employee is hereby awarded              
Restricted Shares (the “Award”), subject to the terms and conditions herein set
forth.  Capitalized terms used herein and
not defined shall have the meanings set forth in the Plan.  In the event of any conflict between this
Agreement and the Plan, the Plan shall control.

 

2.                                       Terms and Conditions.  It is understood and agreed
that the Award of Restricted Shares evidenced hereby is subject to the
following terms and conditions:

 

(a)                                  Vesting of Award.  Subject to Section 2(b) below
and the other terms and conditions of this Agreement, this Award shall become
vested in three equal annual installments on the first, second and third
anniversaries of the date hereof.  Unless
otherwise provided by the Company, all dividends and other amounts receivable
in connection with any adjustments to the Shares under Section 4(c) of
the Plan shall be subject to the vesting schedule in this Section 2(a).

 

(b)                                 Termination of
Service; Forfeiture of Unvested Shares.

 

(i)                                     In the event
the Employee ceases to be an employee of the Company prior to the date the
Restricted Shares otherwise become vested due to his or her death or Permanent
Disability (as defined in the Company’s Incentive Compensation Plan on the date
hereof), the Restricted Shares shall become immediately vested in full upon
such termination of employment.

 

(ii)                                  In the event of
termination of employment (other than by the Company for Cause, as such term is
defined in the Company’s Incentive Compensation Plan on the date hereof) after
the attainment of Retirement Age (as defined in the Company’s Incentive
Compensation Plan on the date hereof), the Restricted Shares shall continue to
vest on the schedule set forth in Section 2(a) above so long as the
Employee does not engage in any activity in competition with any activity of
the Company or any of its Subsidiaries other than serving on the board of
directors (or similar governing body) of another company or as a consultant for
no more than 26 weeks per calendar year (“Competitive Activity”).

 

 

In the event the Employee
engages in a Competitive Activity, any unvested Restricted Shares shall be forfeited
by the Employee and become the property of the Company.

 

(iii)                               In the event
the Employee ceases to be an employee of the Company after a Change in Control
(as defined below) due to termination by the Company not for Cause on or before
the second anniversary of the occurrence of the Change in Control, the
Restricted Shares, to the extent not already vested, shall become immediately
vested in full upon such termination of employment.

 

(iv)                              If the Employee
ceases to be an Employee of the Company for any other reason prior to the date
the Restricted Shares become vested, the Award shall be forfeited by the
Employee and become the property of the Company; provided that, in the event of
a Redundancy (as defined below), the Committee, in its sole discretion, may, in
accordance with its authority under the Plan, determine that the Restricted
Shares, to the extent not vested, shall become vested upon such termination of
employment.

 

(v)                                 For purposes of
this Agreement, service with any of the Company’s Subsidiaries (as defined in
the Plan) shall be considered to be service with the Company.

 

(vi)                              “Change in
Control” shall mean:

 

(A)                              any person
(within the meaning of the Securities Exchange Act of 1934, as amended (the
“Exchange Act”), other than a Permitted Person, is or becomes the “beneficial owner”
(as defined in Rule 13d-3 under the Exchange Act), directly or indirectly,
of Voting Securities representing 50% or more of the total voting power or
value of all the then outstanding Voting Securities; or

 

(B)                                the individuals
who, as of the date hereof, constitute the Board of Directors of the Company
(the “Board”) together with those who become directors subsequent to such date
and whose recommendation, election or nomination for election to the Board was
approved by a vote of at least a majority of the directors then still in office
who either were directors as of such date or whose recommendation, election or
nomination for election was previously so approved, cease for any reason to
constitute a majority of the members of the Board; or

 

(C)                                the consummation
of a merger, consolidation, recapitalization, liquidation, sale or disposition
by the

 

2

 

Company of all or substantially all of the
Company’s assets, or reorganization of the Company, other than any such
transaction which would (x) result in more than 50% of the total voting
power and value represented by the voting securities of the surviving entity
outstanding immediately after such transaction being beneficially owned by the
former shareholders of the Company and (y) not otherwise be deemed a
Change in Control under subparagraphs (A) or (B) of this paragraph.

 

“Permitted Persons” means (A) the Company; (B) any Related
Party; (C) Hellman & Friedman or any of its subsidiaries or
investment funds managed or controlled by Hellman & Friedman; (D) Warburg
Pincus or any of its subsidiaries or any investment funds managed or controlled
by Warburg Pincus or any of its subsidiaries; or (E) any group (as defined
in Rule 13b-3 under the Exchange Act) comprised of any or all of the foregoing.

 

“Related Party” means (A) a majority-owned subsidiary of the
Company; (B) a trustee or other fiduciary holding securities under an
employee benefit plan of the Company or any majority-owned subsidiary of the Company;
or (C) any entity, 50% or more of the voting power of which is owned
directly or indirectly by the shareholders of the Company in substantially the
same proportion as their ownership of Voting Securities immediately prior to
the transaction.

 

“Voting
Security” means any security of the Company which carries the right to vote
generally in the election of directors.

 

(vii)                           “Redundancy”
shall mean termination of employment by the Company due to its need to reduce
the size of its workforce, including due to closure of a business or a
particular workplace or change in business process.  Whether a termination
of employment is due to a “redundancy” shall be determined by the Committee in
its sole and absolute discretion, such determination being final and binding on
all parties hereto and all persons claiming through, in the name of or on
behalf of such parties.

 

(c)                                  Certificates.  Each
certificate issued in respect of Restricted Shares awarded hereunder shall be
deposited with the Company, or its designee, together with, if

 

3

 

requested by the Company, a stock power
executed in blank by the Employee, and shall bear a legend disclosing the
restrictions on transferability imposed on such Restricted Shares by this
Agreement (the “Restrictive Legend”). 
Upon the vesting of Restricted Shares pursuant to Section 2 hereof
and the satisfaction of any withholding tax liability pursuant to Section 5
hereof, such vested Shares, not bearing the Restrictive Legend, shall be
delivered to the Employee.

 

(d)                                 Rights of a Stockholder.  Prior
to the time a Restricted Share is fully vested hereunder, the Employee shall
have no right to transfer, pledge, hypothecate or otherwise encumber such
Restricted Share.  During such period,
the Employee shall have all other rights of a stockholder, including, but not limited to, the
right to vote and to receive dividends (subject to Section 2(a) hereof)
at the time paid on such Restricted Shares.

 

(e)                                  No Right to Continued Employment.  This Award shall not confer
upon the Employee any right with respect to continuance of employment by the
Company nor shall this Award interfere with the right of the Company to
terminate the Employee’s employment at any time.

 

3.                                       Transfer of Shares.  The Shares delivered
hereunder, or any interest therein, may be sold, assigned, pledged,
hypothecated, encumbered, or transferred or disposed of in any other manner, in
whole or in part, only in compliance with the terms, conditions and
restrictions as set forth in the governing instruments of the Company, applicable
United States federal and state securities laws or any other applicable laws or
regulations and the terms and conditions hereof.

 

4.                                       Expenses of Issuance of Shares.  The issuance of stock
certificates hereunder shall be without charge to the Employee.  The Company shall pay any issuance, stamp or
documentary taxes (other than transfer taxes) or charges imposed by any governmental
body, agency or official (other than income taxes) or by reason of the issuance
of Shares.

 

5.                                       Withholding.  No later than the date of
vesting of (or the date of an election by the Employee under Section 83(b) of
the Code with respect to) the Award granted hereunder, the Employee shall pay
to the Company or make arrangements satisfactory to the Committee regarding
payment of any federal, state or local taxes of any kind required by law to be
withheld at such time with respect to such Award and the Company shall, to the
extent permitted or required by law, have the right to deduct from any payment
of any kind otherwise due to the Employee, federal, state and local taxes of
any kind required by law to be withheld at such time.

 

6.                                       References.  References herein to rights and
obligations of the Employee shall apply, where appropriate, to the Employee’s
legal representative or estate without regard to whether specific reference to
such legal representative or estate is contained in a particular provision of
this Agreement.

 

4

 

7.                                       Notices.  Any notice required or permitted to be
given under this Agreement shall be in writing and shall be deemed to have been
given when delivered personally or by courier, or sent by certified or
registered mail, postage prepaid, return receipt requested, duly addressed to
the party concerned at the address indicated below or to such changed address
as such party may subsequently by similar process give notice of:

 

If to the Company:

 

Arch Capital Group Ltd.

Wessex House, 4th Floor

45 Reid Street

Hamilton HM 12 Bermuda 

Attn.: Secretary

 

If to the Employee:

 

To the last address
delivered to the Company by the 

Employee in the manner set forth herein.

 

8.                                       Governing Law.  This Agreement shall be
governed by and construed in accordance with the laws of New York, without
giving effect to principles of conflict of laws.

 

9.                                       Entire Agreement.  This Agreement and the Plan
constitute the entire agreement among the parties relating to the subject
matter hereof, and any previous agreement or understanding among the parties
with respect thereto is superseded by this Agreement and the Plan.

 

10.                                 Counterparts.  This Agreement may be
executed in two counterparts, each of which shall constitute one and the same
instrument.

 

5

 

IN
WITNESS WHEREOF, the undersigned have executed this Agreement as of the date
first above written.

 

	
   

  	
  ARCH
  CAPITAL GROUP LTD.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  
	
   

  	
   

  	
  Name:

  
	
   

  	
   

  	
  Title:

  

 

6

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