Document:

Exhibit 10.35

 

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;

 

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.

 

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.

 

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 by reason of the Participant’s
Retirement, the ten-year anniversary of the Grant Date; or

 

2

 

(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.

 

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 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.”

 

3

 

(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 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 Cause or 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.

 

4

 

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)           Cause.
The term “Cause” 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, AMBAC Financial Group Inc., CIFG Group, Financial Guaranty
Insurance Company, Financial Security Assurance Inc., MBIA, 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

 

5

 

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.

 

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

 

(c)           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 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.

 

(d)           Detrimental
Activity. The term “Detrimental Activity” shall mean the occurrence of
actions described in clause (i) (relating to competition), (ii) (relating to
confidentiality), or (iv) (relating to solicitation), all as set forth under
the definition of “Cause” above.

 

(e)           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.

 

(f)            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.

 

6

 

(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 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
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.

 

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:

  	
  James Michener

  	
   

  
	
  Its:

  	
  General Counsel

  	
   

  
	
   

  
	
   

  
	
  Participant:

  	
   

  	
   

  
					

 

7Exhibit 10.36

 

Restricted Stock
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 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                                                                                 .

 

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

 

Other words and phrases used in this Agreement are
defined pursuant to paragraph 15 or elsewhere in this Agreement.

 

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

 

3. Restricted
Period. Subject to the limitations of this Agreement, the “Restricted
Period” for the Covered Shares of the Restricted Stock Award shall begin on the
Grant Date and end [Alternative 1:  (for
initial grants)  on the day
immediately prior to the third annual shareholders meeting following the
meeting during which elections for directors were held and the Director was
elected. Alternative 2:  (for use
after share guidelines have been met) 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 Covered Shares
ends on or before the date the Director ceases to be a director of the Company,
then at the

 

(1)  This form should only be used for the initial
one-time award valued at $100,000 and awards that are made AFTER the director
has satisfied the share ownership guidelines.

 

 

end of such Restricted Period, the Covered Shares shall be transferred
to the Director free of all restrictions. If the Restricted Period with respect
to the Covered Shares does not end on or before the 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 Covered Shares.(2)

 

5. 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.

 

6. Dividends.
The Director shall be entitled to receive any dividends paid with respect to
the Covered Shares that become payable during the Restricted Period. Any
dividends shall be payable to the Director in cash. The Director 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 Director 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 Director has
forfeited those shares.

 

7. Voting.
The Director 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 Director 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 Director has
forfeited those shares.

 

8. 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
Director.

 

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 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.

 

(2)  The award will not continue to vest if a
person ceases to be a director of the company but continues to be an employee
of the company.

 

2

 

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 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.

 

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 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.

 

12. 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.

 

13. 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 Director
an amount equal to the fair market value of such fractional share.

 

14. 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.

 

15. 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

  	
   

  
	
   

  	
   

  
	
   

  	
   

  

 

3

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