Document:

Exhibit 10.19

 

Option No.:

 

 

ACA
CAPITAL HOLDINGS, INC.

AMENDED AND RESTATED 2006 STOCK
INCENTIVE PLAN

AMENDED
AND RESTATED INCENTIVE STOCK OPTION AGREEMENT

ACA Capital Holdings, Inc., a Delaware
corporation (the “Company”), hereby grants an option to purchase its common
stock, $.10 par value, (the “Stock”) to the optionee named below.  The terms and conditions of the option are
set forth in this cover sheet, in the attachment, and in the Company’s Amended
and Restated 2006 Stock Incentive Plan (the “Plan”).

Grant Date:

Name of Optionee:

Optionee’s Social
Security Number:

Number of Shares Covered
by Option:

Option Price per Share:

Vesting Start Date:

By signing this cover sheet, you
agree to all of the terms and conditions described in the attached Agreement
and in the Plan, a copy of which is also attached.  You acknowledge that you have carefully
reviewed the Plan, and agree that the Plan will control in the event any
provision of this Agreement should appear to be inconsistent.

	
  Optionee:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  (Signature)

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Company:

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
  (Signature)

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Title:

  	
   

  	
   

  

 

Attachment

This is not a share
certificate or a negotiable instrument.

 

ACA
CAPITAL HOLDINGS, INC.

AMENDED AND RESTATED 2006 STOCK
INCENTIVE PLAN

AMENDED
AND RESTATED INCENTIVE STOCK OPTION AGREEMENT 

	
  Incentive Stock Option

  	
   

  	
  This option is intended to be an
  incentive stock option under Section 422 of the Internal Revenue Code and
  will be interpreted accordingly. If you cease to be an employee of the
  Company, its parent or a subsidiary (“Employee”) but continue to provide
  Service, this option will be deemed a nonstatutory stock option three months
  after you cease to be an Employee. In addition, to the extent that all or
  part of this option exceeds the $100,000 rule of section 422(d) of the
  Internal Revenue Code, this option or the lesser excess part will be deemed
  to be a nonstatutory stock option.

  
	
   

  	
   

  	
   

  
	
  Vesting

  	
   

  	
  This option is only exercisable
  before it expires and then only with respect to the vested portion of the
  option. Subject to the preceding sentence, you may exercise this option, in
  whole or in part, to purchase a whole number of vested shares not less than
  100 shares, unless the number of shares purchased is the total number
  available for purchase under the option, by following the procedures set
  forth in the Plan and below in this Agreement.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Your right to purchase shares of
  Stock under this option vests over forty-two (42) months, with 1/7 of the
  total number of shares covered by this option, as shown on the cover sheet,
  vesting every six months beginning on the date that is six months from the
  Grant Date; all provided you have been continuously in Service from the Grant
  Date through the applicable vesting date.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  No additional shares of Stock
  will vest after your Service has terminated for any reason.

  
	
   

  	
   

  	
   

  
	
  Term

  	
   

  	
  Your option will expire in any
  event at the close of business at Company headquarters on the day before the
  10th anniversary of the Grant Date, as shown on the cover sheet. Your option
  will expire earlier if your Service terminates, as described below.

  
	
   

  	
   

  	
   

  
	
  Regular
  Termination

  	
   

  	
  If your Service terminates for
  any reason, other than death or Disability, then your option will expire at
  the close of business at Company headquarters on the 90th day after your
  termination date.

  
	
   

  	
   

  	
   

  
	
  Death

  	
   

  	
  If your Service terminates
  because of your death, then your option will expire at the close of business
  at Company headquarters on the date six (6) months after the date of death.
  During that six month period, your estate or heirs may exercise the vested
  portion of your option.

  

 

 

2

 

	
   

  	
   

  	
  In addition, if you die during
  the 90-day period described in connection with a regular termination (i.e., a
  termination of your Service not on account of your death or Disability), and
  a vested portion of your option has not yet been exercised, then your option
  will instead expire on the date six (6) months after your termination date.
  In such a case, during the period following your death up to the date six (6)
  months after your termination date, your estate or heirs may exercise the
  vested portion of your option.

  
	
   

  	
   

  	
   

  
	
  Disability

  	
   

  	
  If your Service terminates
  because of your Disability, then your option will expire at the close of
  business at Company headquarters on the date six (6) months after your
  termination date.

  
	
   

  	
   

  	
   

  
	
  Leaves of
  Absence

  	
   

  	
  For purposes of this option, your
  Service does not terminate when you go on a bona fide
  employee leave of absence that was approved by the Company in writing, if the
  terms of the leave provide for continued Service crediting, or when continued
  Service crediting is required by applicable law. However, your Service will
  be treated as terminating 90 days after you went on employee leave, unless
  your right to return to active work is guaranteed by law or by written
  agreement with the Company. Your Service terminates in any event when the
  approved leave ends unless you immediately return to active employee work.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  The Company determines, in its
  sole discretion, which leaves count for this purpose, and when your Service
  terminates for all purposes under the Plan.

  
	
   

  	
   

  	
   

  
	
  Notice of
  Exercise

  	
   

  	
  When you wish to exercise this
  option, you must notify the Company by filing the proper “Notice of Exercise”
  form at the address given on the form. Your notice must specify how many
  shares you wish to purchase (in a parcel of at least 100 shares generally).
  Your notice must also specify how your shares of Stock should be registered
  (in your name only or in your and your spouse’s names as joint tenants with
  right of survivorship). The notice will be effective when it is received by
  the Company.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  If someone else wants to exercise
  this option after your death, that person must prove to the Company’s
  satisfaction that he or she is entitled to do so.

  
	
   

  	
   

  	
   

  
	
  Form of Payment

  	
   

  	
  When you submit your notice of
  exercise, you must include payment of the option price for the shares you are
  purchasing. Payment may be made in one (or a combination) of the following
  forms:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  ·    Cash, your personal check, a cashier’s
  check, a money order 

  

 

 

3

 

	
   

  	
   

  	
  or another cash equivalent
  acceptable to the Company.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  ·    Shares of Stock which have already been
  owned by you for more than six months and which are surrendered to the
  Company. The value of the shares, determined as of the effective date of the
  option exercise in accordance with the Plan, will be applied to the option
  price.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  ·    To the extent a public market for the
  Stock exists as determined by the Company, by delivery (on a form prescribed
  by the Company) of an irrevocable direction to a licensed securities broker
  acceptable to the Company to sell Stock and to deliver all or part of the
  sale proceeds to the Company in payment of the aggregate option price and any
  withholding taxes (if approved in advance by the Compensation Committee of
  the Board if you are either an executive officer or a director of the
  Company).

  
	
   

  	
   

  	
   

  
	
  Withholding
  Taxes

  	
   

  	
  You will not be allowed to
  exercise this option unless you make acceptable arrangements to pay any
  withholding or other taxes that may be due as a result of the option exercise
  or sale of Stock acquired under this option. In the event that the Company
  determines that any federal, state, local or foreign tax or withholding payment
  is required relating to the exercise or sale of shares arising from this
  grant, the Company shall have the right to require such payments from you, or
  withhold such amounts from other payments due to you from the Company or any
  Affiliate (as defined in the Plan).

  
	
   

  	
   

  	
   

  
	
  Transfer of
  Option

  	
   

  	
  During your lifetime, only you
  (or, in the event of your legal incapacity or incompetency, your guardian or
  legal representative) may exercise the option. You cannot transfer or assign
  this option. For instance, you may not sell this option or use it as security
  for a loan. If you attempt to do any of these things, this option will
  immediately become invalid. You may, however, dispose of this option in your
  will or it may be transferred upon your death by the laws of descent and
  distribution.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Regardless of any marital
  property settlement agreement, the Company is not obligated to honor a notice
  of exercise from your spouse, nor is the Company obligated to recognize your
  spouse’s interest in your option in any other way.

  

 

 

4

 

	
  Retention Rights

  	
   

  	
  Neither your option nor this
  Agreement give you the right to be retained by the Company (or any
  Subsidiaries (as defined in the Plan) or Affiliates) in any capacity. The
  Company (and any Subsidiaries or Affiliates) reserve the right to terminate
  your Service at any time and for any reason.

  
	
   

  	
   

  	
   

  
	
  Stockholder
  Rights

  	
   

  	
  You, or your estate or heirs,
  have no rights as a stockholder of the Company until a certificate for your
  option’s shares has been issued (or an appropriate book entry has been made).
  No adjustments are made for dividends or other rights if the applicable
  record date occurs before your stock certificate is issued (or an appropriate
  book entry has been made), except as described in the Plan.

  
	
   

  	
   

  	
   

  
	
  Adjustments

  	
   

  	
  In the event of a stock split, a
  stock dividend or a similar change in the Stock, the number of shares covered
  by this option and the option price per share shall be adjusted (and rounded
  down to the nearest whole number) if required pursuant to the Plan. Your
  option shall be subject to the terms of the agreement of merger, liquidation
  or reorganization in the event the Company is subject to such corporate
  activity.

  
	
   

  	
   

  	
   

  
	
  Applicable Law

  	
   

  	
  This Agreement will be
  interpreted and enforced under the laws of the State of New York, other than
  any conflicts or choice of law rule or principle that might otherwise refer
  construction or interpretation of this Agreement to the substantive law of
  another jurisdiction.

  
	
   

  	
   

  	
   

  
	
  The Plan

  	
   

  	
  The text of the Plan is
  incorporated in this Agreement by reference. Certain capitalized terms used
  in this Agreement are defined in the Plan, and have the meaning set forth in
  the Plan.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  This Agreement and the Plan
  constitute the entire understanding between you and the Company regarding
  this option. Any prior agreements, commitments or negotiations concerning
  this option are superseded.

  
	
   

  	
   

  	
   

  
	
  Data Privacy

  	
   

  	
  In order to administer the Plan,
  the Company may process personal data about you. Such data includes but is
  not limited to the information provided in this Agreement and any changes
  thereto, other appropriate personal and financial data about you such as home
  address and business addresses and other contact information, payroll
  information and any other information that might be deemed appropriate by the
  Company to facilitate the administration of the Plan.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By accepting this option, you
  give explicit consent to the Company to process any such personal data. You
  also give explicit consent 

  

 

 

5

 

	
   

  	
   

  	
  to the Company to transfer any
  such personal data outside the country in which you work or are employed,
  including, with respect to non-U.S. resident Optionees, to the United States,
  to transferees who shall include the Company and other persons who are
  designated by the Company to administer the Plan.

  
	
   

  	
   

  	
   

  
	
  Consent to
  Electronic Delivery

  	
   

  	
  The Company may choose to deliver
  certain statutory materials relating to the Plan in electronic form. By
  accepting this option grant you agree that the Company may deliver the Plan
  prospectus, if any, and the Company’s annual report, if any, to you in an
  electronic format. If at any time you would prefer to receive paper copies of
  these documents, as you are entitled to, the Company would be pleased to
  provide copies. Please contact Nora J. Dahlman at ACA Capital Holdings, Inc.
  to request paper copies of these documents.

  
	
   

  	
   

  	
   

  
	
  Certain
  Dispositions

  	
   

  	
  If you sell or otherwise dispose
  of Stock acquired pursuant to the exercise of this option sooner than the one year
  anniversary of the date you
  acquired the Stock, then you agree to notify the Company in writing of the
  date of sale or disposition, the number of shares of Stock sold or disposed
  of and the sale price per share within 30 days of such sale or disposition.

  
	
   

  	
   

  	
   

  
	
  Execution of

  Stockholders Agreement

  	
   

  	
  As a condition to your exercise
  of this option, you must, if requested by the Company, execute a counterpart
  to the Stockholders Agreement dated as of September 30, 2004 among the
  Company, BSMB/ACA LLC and the other signatories thereto, or such other form
  of stockholders agreement satisfactory to the Company (as such agreement may
  be amended, modified or restated from time to time).

  

 

By signing the cover sheet of this Agreement, you
agree to all of the terms and

conditions described above and in the Plan.

 

6Exhibit 10.20

 

Option No.:

 

 

ACA
CAPITAL HOLDINGS, INC.

AMENDED AND RESTATED 2006 STOCK
INCENTIVE PLAN

AMENDED
AND RESTATED NON-QUALIFIED STOCK OPTION AGREEMENT

ACA Capital Holdings, Inc., a Delaware corporation (the “Company”),
hereby grants an option to purchase its common stock, $.10 par value, (the “Stock”)
to the optionee named below.  The terms
and conditions of the option are set forth in this cover sheet, in the
attachment, and in the Company’s Amended and Restated 2006 Stock Incentive Plan
(the “Plan”).

Grant Date:

Name of Optionee:

Optionee’s Social
Security Number:

Number of Shares Covered by Option:

Option Price per Share:

Vesting Start Date:

By signing this cover sheet, you
agree to all of the terms and conditions described in the attached Agreement
and in the Plan, a copy of which is also attached.  You acknowledge that you have carefully
reviewed the Plan, and agree that the Plan will control in the event any
provision of this Agreement should appear to be inconsistent.

	
  Optionee:

  	
   

  
	
   

  	
  (Signature)

  
	
   

  	
   

  
	
  Company:

  	
   

  
	
   

  	
  (Signature)

  
	
   

  	
   

  
	
   

  	
  Title:

  	
   

  

Attachment

This is not a share certificate or a negotiable
instrument.

 

 

ACA
CAPITAL HOLDINGS, INC.

AMENDED AND RESTATED 2006 STOCK
INCENTIVE PLAN

AMENDED
AND RESTATED NON-QUALIFIED STOCK OPTION AGREEMENT

	
  Nonqualified
  Stock Option

  	
  This Option is
  not intended to be an incentive stock option under Section 422 of the
  Internal Revenue Code and will be interpreted accordingly.

  
	
   

  	
   

  
	
  Vesting

  	
  This option is
  only exercisable before it expires and then only with respect to the vested
  portion of the option. Subject to the preceding sentence, you may exercise
  this option, in whole or in part, to purchase a whole number of vested shares
  not less than 100 shares, unless the number of shares purchased is the total
  number available for purchase under the option, by following the procedures
  set forth in the Plan and below in this Agreement. 

  
	
   

  	
   

  
	
   

  	
  Your right to
  purchase shares of Stock under this option vests over forty-two (42) months,
  with 1/7 of the total number of shares covered by this option, as shown on
  the cover sheet, vesting every six months beginning on the date that is six
  months from the Grant Date; all provided you have been continuously in
  Service from the Grant Date through the applicable vesting date.

  
	
   

  	
   

  
	
   

  	
  No additional
  shares of Stock will vest after your Service has terminated for any reason.

  
	
   

  	
   

  
	
  Term

  	
  Your option will
  expire in any event at the close of business at Company headquarters on the
  day before the 10th anniversary of the Grant Date, as shown on the cover sheet.
  Your option will expire earlier if your Service terminates, as described
  below.

  
	
   

  	
   

  
	
  Regular
  Termination

  	
  If your Service
  terminates for any reason, other than death or Disability, then your option
  will expire at the close of business at Company headquarters on the 90th day
  after your termination date.

  
	
   

  	
   

  
	
  Death

  	
  If your Service
  terminates because of your death, then your option will expire at the close
  of business at Company headquarters on the date six (6) months after the date
  of death. During that six month period, your estate or heirs may exercise the
  vested portion of your option. 

  
	
   

  	
   

  
	
   

  	
  In addition, if
  you die during the 90-day period described in connection with a regular
  termination (i.e., a termination of your Service not on account of your death
  or Disability), and a vested portion of your option has not yet been
  exercised, then your option will instead expire on the date six (6) months
  after your termination date. In such a case, during the period following your
  death up to

  

 

2

 

	
   

  	
  the date six (6)
  months after your termination date, your estate or heirs may exercise the
  vested portion of your option.

  
	
   

  	
   

  
	
  Disability

  	
  If your Service
  terminates because of your Disability, then your option will expire at the
  close of business at Company headquarters on the date six (6) months after
  your termination date.

  
	
   

  	
   

  
	
  Leaves
  of Absence

  	
  For purposes of
  this option, your Service does not terminate when you go on a bona fide employee leave of absence that was approved by
  the Company in writing, if the terms of the leave provide for continued
  Service crediting, or when continued Service crediting is required by
  applicable law. However, your Service will be treated as terminating 90 days
  after you went on employee leave, unless your right to return to active work
  is guaranteed by law or by written agreement with the Company. Your Service
  terminates in any event when the approved leave ends unless you immediately
  return to active employee work. 

  
	
   

  	
   

  
	
   

  	
  The Company
  determines, in its sole discretion, which leaves count for this purpose, and
  when your Service terminates for all purposes under the Plan.

  
	
   

  	
   

  
	
  Notice
  of Exercise

  	
  When you wish to
  exercise this option, you must notify the Company by filing the proper
  “Notice of Exercise” form at the address given on the form. Your notice must
  specify how many shares you wish to purchase (in a parcel of at least 100
  shares generally). Your notice must also specify how your shares of Stock
  should be registered (in your name only or in your and your spouse’s names as
  joint tenants with right of survivorship). The notice will be effective when
  it is received by the Company.

  
	
   

  	
   

  
	
   

  	
  If someone else
  wants to exercise this option after your death, that person must prove to the
  Company’s satisfaction that he or she is entitled to do so.

  
	
   

  	
   

  
	
  Form of
  Payment

  	
  When you submit
  your notice of exercise, you must include payment of the option price for the
  shares you are purchasing. Payment may be made in one (or a combination) of
  the following forms:    

  
	
   

  	
   

  
	
   

  	
  ·              Cash,
  your personal check, a cashier’s check, a money order or another cash
  equivalent acceptable to the Company.

  
	
   

  	
   

  
	
   

  	
  ·              Shares
  of Stock which have already been owned by you for more than six months and
  which are surrendered to the Company. The value of the shares, determined as
  of the effective date of the option exercise in accordance with the Plan,
  will be applied to the

  

 

3

 

	
   

  	
  option price.

  
	
   

  	
   

  
	
   

  	
  ·              To
  the extent a public market for the Stock exists as determined by the Company,
  by delivery (on a form prescribed by the Company) of an irrevocable direction
  to a licensed securities broker acceptable to the Company to sell Stock and
  to deliver all or part of the sale proceeds to the Company in payment of the
  aggregate option price and any withholding taxes (if approved in advance by
  the Compensation Committee of the Board if you are either an executive
  officer or a director of the Company).

  
	
   

  	
   

  
	
  Withholding
  Taxes

  	
  You will not be
  allowed to exercise this option unless you make acceptable arrangements to
  pay any withholding or other taxes that may be due as a result of the option
  exercise or sale of Stock acquired under this option. In the event that the
  Company determines that any federal, state, local or foreign tax or
  withholding payment is required relating to the exercise or sale of shares
  arising from this grant, the Company shall have the right to require such
  payments from you, or withhold such amounts from other payments due to you
  from the Company or any Affiliate (as defined in the Plan).

  
	
   

  	
   

  
	
  Transfer
  of Option

  	
  During your
  lifetime, only you (or, in the event of your legal incapacity or
  incompetency, your guardian or legal representative) may exercise the option.
  You cannot transfer or assign this option. For instance, you may not sell
  this option or use it as security for a loan. If you attempt to do any of
  these things, this option will immediately become invalid. You may, however,
  dispose of this option in your will or it may be transferred upon your death
  by the laws of descent and distribution. 

  
	
   

  	
   

  
	
   

  	
  Regardless of
  any marital property settlement agreement, the Company is not obligated to
  honor a notice of exercise from your spouse, nor is the Company obligated to
  recognize your spouse’s interest in your option in any other way.

  
	
   

  	
   

  
	
  Retention
  Rights

  	
  Neither your
  option nor this Agreement give you the right to be retained by the Company
  (or any Subsidiaries (as defined in the Plan) or Affiliates) in any capacity.
  The Company (and any Subsidiaries or Affiliates) reserve the right to
  terminate your Service at any time and for any reason.

  
	
   

  	
   

  
	
  Stockholder
  Rights

  	
  You, or your
  estate or heirs, have no rights as a stockholder of the Company until a
  certificate for your option’s shares has been issued (or an appropriate book
  entry has been made). No adjustments are made for dividends or other rights
  if the applicable record date occurs before your stock certificate is issued
  (or an appropriate

  

 

4

 

	
   

  	
  book entry has
  been made), except as described in the Plan.

  
	
   

  	
   

  
	
  Adjustments

  	
  In the event of
  a stock split, a stock dividend or a similar change in the Stock, the number
  of shares covered by this option and the option price per share shall be
  adjusted (and rounded down to the nearest whole number) if required pursuant
  to the Plan. Your option shall be subject to the terms of the agreement of
  merger, liquidation or reorganization in the event the Company is subject to
  such corporate activity.

  
	
   

  	
   

  
	
  Applicable
  Law

  	
  This Agreement
  will be interpreted and enforced under the laws of the State of New York,
  other than any conflicts or choice of law rule or principle that might
  otherwise refer construction or interpretation of this Agreement to the
  substantive law of another jurisdiction.

  
	
   

  	
   

  
	
  The
  Plan

  	
  The text of the
  Plan is incorporated in this Agreement by reference. Certain capitalized
  terms used in this Agreement are defined in the Plan, and have the meaning
  set forth in the Plan. 

  
	
   

  	
   

  
	
   

  	
  This Agreement
  and the Plan constitute the entire understanding between you and the Company
  regarding this option. Any prior agreements, commitments or negotiations
  concerning this option are superseded.

  
	
   

  	
   

  
	
  Data
  Privacy

  	
  In order to
  administer the Plan, the Company may process personal data about you. Such
  data includes but is not limited to the information provided in this
  Agreement and any changes thereto, other appropriate personal and financial
  data about you such as home address and business addresses and other contact
  information, payroll information and any other information that might be
  deemed appropriate by the Company to facilitate the administration of the
  Plan. 

  
	
   

  	
   

  
	
   

  	
  By accepting
  this option, you give explicit consent to the Company to process any such
  personal data. You also give explicit consent to the Company to transfer any
  such personal data outside the country in which you work or are employed,
  including, with respect to non-U.S. resident Optionees, to the United States,
  to transferees who shall include the Company and other persons who are
  designated by the Company to administer the Plan.

  
	
   

  	
   

  
	
  Consent
  to Electronic

  Delivery

  	
  The Company may
  choose to deliver certain statutory materials relating to the Plan in
  electronic form. By accepting this option grant you agree that the Company may
  deliver the Plan prospectus, if any, and the Company’s annual report, if any,
  to you in an electronic format. If at any time you would prefer to receive
  paper 

  

 

5

 

	
   

  	
  copies of these
  documents, as you are entitled to, the Company would be pleased to provide
  copies. Please contact Nora J. Dahlman at ACA Capital Holdings, Inc. to
  request paper copies of these documents.

  
	
   

  	
   

  
	
  Execution
  of Stockholders Agreement

  	
  As a condition
  to your exercise of this option, you must, if requested by the Company,
  execute a counterpart to the Stockholders Agreement dated as of September 30,
  2004 among the Company, BSMB/ACA LLC and the other signatories thereto (as
  such agreement may be amended, modified or restated from time to time), or
  such other form of stockholders agreement satisfactory to the Company.

  

 

By
signing the cover sheet of this Agreement, you agree to all of the terms and

conditions described above and in the Plan.

 

6

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