Document:

c55491_ex4-2.htm -- Converted by SEC Publisher, created by BCL Technologies Inc., for SEC Filing

 

  Exhibit 10.1

 

September 29, 2008

J.P. Morgan Securities Inc. 

383 Madison Avenue 

New York, NY 10179 

Attention: John Purcell, Managing Director

Ladies and Gentlemen: 

                 This letter confirms the arrangements under which J.P. Morgan Securities Inc. (“JPMorgan”) is engaged by Weil, Gotshal & Manges  LLP (“WGM”) to assist WGM in its representation of Syncora Guarantee Inc. and its subsidiaries and affiliates (collectively, “Syncora”),
in identifying and analyzing potential strategic alternatives with respect to Syncora’s portfolio of credit default swap and financial guarantee contracts (collectively, the “Contracts”) identified in Appendix 1a, Appendix 1b and Appendix 1c, respectively (together, the “Portfolio”), including one or more Transactions (as defined below).  In
connection with the work to be performed by WGM, JPMorgan agrees to act at WGM’s direction in connection with the above project. For purposes hereof, the term “Transaction”
shall mean, directly or indirectly, any commutation, termination, amendment or restructuring of exposures pursuant to the provisions of section 6.12 of the Master Commutation, Release and Restructuring Agreement (the “MTA”) with respect to existing Contracts listed in Appendix 1a or Appendix 1b with the counterparties identified in Appendix 2 (each a “Counterparty” and collectively, “Counterparties”), and/or any similar transaction. 

                 Section 1.  Financial Advisory Services.  During the term of this engagement, JPMorgan will:

                 (a) perform financial analyses to assist WGM in its advisement of Syncora with regard to assessing the indicative fair market and intrinsic values (when applicable) of the Portfolio considered individually by Contract (other
than any such Contract for which sufficient information is not available to JPMorgan to enable it to perform financial analyses on a reasonable basis); provided that it is understood and
agreed that in performing such analyses, JPMorgan will take into account, among other things, the credit and market risk aspects of the

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September 29, 2008 

Page 2 

Portfolio, will utilize valuation methodology and financial modeling which JPMorgan deems appropriate based on its professional judgment and experience in similar circumstances and if requested, JPMorgan will make
itself available to WGM and/or Syncora to describe such aspects, methodology and modeling in reasonable detail;

                 (b) assist WGM in its advisement of Syncora with regard to developing a strategy and process for assessing potential alternatives and third-party proposals related to any Transaction, as well as provide Syncora
with access to, among others, economists and traders; and 

                 (c) assist WGM in its advisement of Syncora with regard to negotiating in principle the financial terms of one or more Transactions; provided that nothing in this agreement shall obligate JPMorgan or its affiliates (collectively, “Morgan”) to act as principal
or agent in any such Transaction or to bid for or make a market in the Portfolio, any Contract or any underlying assets and it is agreed that in the event JPMorgan agrees to act as agent or principal in effecting any Transaction, the terms of such
role shall be as set forth in a separate written agreement, including additional compensation to be agreed by the parties thereto. 

                 For avoidance of doubt, it is understood and agreed that (i) JPMorgan’s scope of service hereunder shall not include the documentation, structuring or closing of any particular Transaction or the rendering
of any opinion as to the fairness of the terms of any Transaction; and (ii) any valuation analyses provided by JPMorgan pursuant to the services described herein shall not be deemed a representation or assurance that any party would be prepared to
acquire the Portfolio or any Contract or underlying assets which are the subject of such analysis at a price equal to the value reflected in such analysis, nor shall such analysis be deemed an offer by Morgan to acquire the Portfolio or such
Contracts or assets at a price equal to the value reflected in such analysis or at any other price. 

                 Syncora, WGM and JPMorgan agree that the Standard Terms and Conditions attached hereto form an integral part of this agreement and are hereby incorporated herein by reference in their entirety. 

                 Section 2. Compensation. Fees for the foregoing services shall be payable to JPMorgan by Syncora as follows: 

               (a) a non-refundable fee of US$7,000,000 payable upon JPMorgan’s delivery of its
analyses and recommendations related to valuation and alternatives for the Contracts listed in Appendix 1a; and 

                 (b) a non-refundable fee of US$3,000,000, contingent upon (i) JPMorgan’s delivery by October 8, 2008 of its analyses and recommendations related to valuation and alternatives for the Contracts listed in
Appendix 1b, (ii) its delivery by October 8, 2008 of its valuation analyses for the Contracts listed in Appendix 1c and (iii) its good faith and active participation in the negotiation and resolution of the Transactions, as outlined in section 6.12
of

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Page 3 

the MTA, which fee shall be payable in three installments of US$1,000,000, on each of the following dates: October 31, 2008, November 30, 2008 and December 31, 2008; and  

                 (c) an additional non-refundable discretionary bonus of up to US$10,000,000, payable in the sole discretion of Syncora, upon consummation of any Counterparty restructuring as outlined in section 6.12 of the
MTA during the term hereof or within 12 months after the expiration or termination of this agreement, based upon Syncora’s sole assessment of JPMorgan’s performance of its services hereunder. 

                 (d) JPMorgan acknowledges that under no circumstances will WGM have (i) any responsibility or obligation to pay JPMorgan’s fees, discretionary bonus, expenses or other charges in connection with the
engagement or (ii) any liability or payment obligations under or in connection with this letter or engagement. 

                 (e) The fees provided for in this Section 2 are not intended to be compensation for any services which JPMorgan may render in the future with respect to any specific Transaction or any other transaction
contemplated by Section 3 below. 

                 Section 3. Other Assignments. In the event that, at any time during the eighteen month period commencing on the date
hereof, Syncora determines to undertake a specific transaction of a type referred to in the following clauses (i) through (iii), which for the avoidance of doubt shall not include any Transactions as defined herein, Syncora shall offer JPMorgan the
non-exclusive right to act in such transaction, subject to appropriate conflict review and other such clearances, as (i) a book-running co-lead manager or agent in the case of any offering or placement of securities, including, but not limited to
debt, equity, preferred and other hybrid equity securities, (ii) a dealer manager, agent or financial advisor, as applicable, in the case of any exchange or tender offer or consent solicitation undertaken by Syncora, and (iii) a co-lead financial
advisor or dealer manager, as applicable, in the case of any divestiture, merger or other business combination transaction, sale transaction involving all or a portion of Syncora, or joint venture, or any other transaction. If JPMorgan agrees to act
in any such capacity, Syncora and JPMorgan will enter into an appropriate form of agreement relating to the type of transaction involved and containing customary and mutually agreeable terms and conditions, including customary and mutually agreeable
fee provisions on such transactions and provisions relating to JPMorgan’s indemnity and compensation. In addition, Syncora shall offer JPMorgan the non-exclusive right to act as a principal or counterparty in the case of any foreign exchange or
commodities transaction, currency or interest rate swap or other hedging or derivative transaction related to the financing of any transaction referred to in the first sentence of this Section 3. Where JPMorgan agrees to act as a principal or
counterparty in a swap, hedging, derivative, stock buyback, reinsurance or any other transaction with Syncora, such transactions will be based on customary documentation for such transactions and JPMorgan will not be acting as an agent of or advisor
to Syncora with respect to such transactions or the terms thereof. Syncora acknowledges that this letter agreement is neither an expressed nor an implied commitment by JPMorgan to act in any capacity in any such transaction, to provide financing or
to purchase or place any securities or to provide or be responsible to provide any other financial services or act

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September 29, 2008 

Page 4 

in any principal capacity, which commitment shall only be set forth in a separate written agreement. 

               Section 4.  Expenses and Payments. In addition to JP Morgan’s fees for professional
services, Syncora agrees to reimburse JPMorgan for reasonable expenses as incurred, and billed separately, including travel costs, document production and other similar expenses, up to a $50,000 cap for the term of this engagement, after which
JPMorgan shall seek Syncora’s consent with respect to such fees, and the reasonable fees of outside counsel and other professional advisors; provided
that the retention of any such outside counsel or other professional advisors shall be subject to pre-approval by Syncora (such approval not to be unreasonably withheld).  All amounts payable under this agreement (including the Standard Terms and
Conditions) shall be paid by Syncora, in immediately available funds in U.S. dollars, without setoff and without deduction for any withholding, value-added or other similar taxes, charges, fees or assessments. 

                 Section 5. Term. This agreement will be effective as of the date of this letter and will expire on December 31, 2008. Services hereunder may be earlier terminated with or without cause by Syncora at any time, or by JPMorgan upon fifteen (15) days prior written notice to
Syncora, and without liability or continuing obligation to Syncora, or JPMorgan (except for any expenses incurred by JPMorgan up to the date of termination to be paid by Syncora); provided
that the provisions of Sections 2, 3 and 4 hereof and Sections 1, 2 and 4 of the Standard Terms and Conditions shall survive any termination or expiration of this agreement.

 

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Page 5 

                 If the terms of the engagement as set forth in this agreement (including the attached Standard Terms and Conditions) are satisfactory, kindly sign the enclosed copy of this letter and return it to the
undersigned.  We look forward to working with JPMorgan on this assignment. 

	 	 	 	Very truly yours,	
	 	 	 	 	 	
	 	 	 	Weil, Gotshal & Manges
LLP	
	 	 	 	 	 	
	 	 	 	 	 	
	 	 	 	By:    	/s/
	    Gary Holtzer	 
	 	 	 	 	Name: Gary Holtzer	
	 	 	 	 	Title: Member of the Firm	
	 	 	 	 	w/ permission BAC
	Accepted and Agreed As Of	 	 	 
	The Date First Written Above:	 	 	 
	 	 	 	 	 	
	J.P. Morgan Securities Inc.	 	 	 
	 	 	 	 	 	
	By:    	/s/
      John J. Purcell 	 	 	 
	 	Name: John J. Purcell III	 	 	 
	 	Title: Managing Director	 	 	
        
	 	 	 	 	 	
	Syncora Guarantee Inc.	 	 	 
	 	 	 	 	 	
	By:	/s/
    Susan Comparato	 	 	 
	 	Name: Susan Comparato	 	 	 
	 	Title: Senior Vice President, General
    Counsel & Secretary	 	 	
        

Enclosure 

 

STANDARD TERMS AND CONDITIONS

The following general terms and conditions shall be incorporated by reference into the engagement letter dated September 29 2008 between Weil, Gotshal & Manges LLP (“WGM”) and J.P. Morgan Securities Inc. (collectively, “JPMorgan”), and agreed to by Syncora Guarantee Inc. and its subsidiaries and affiliates (collectively,
“Syncora”), to which these terms are attached (the “Engagement Letter”).  Capitalized terms used below without definition shall have the meanings assigned to them in the Engagement Letter and any references herein to the “Agreement” shall mean the Engagement Letter together with these Standard Terms and Conditions. 

               Section 1. Indemnification and Contribution.

                 (a) Syncora agrees (i) to indemnify and hold harmless JPMorgan and its affiliates, and the respective directors, officers, agents, and
employees of JPMorgan and its affiliates (JPMorgan and each such entity or person being referred to as an “Indemnified Person”), from and against any losses, claims, demands,
damages or liabilities of any kind (collectively, “Liabilities”) relating to or arising out of activities performed or services furnished pursuant to the Agreement, any alternative
or Transaction or JPMorgan’s role in connection therewith, and (ii) to reimburse each Indemnified Person for all reasonable expenses (including reasonable fees and disbursements of outside counsel) incurred by such Indemnified Person in
connection with investigating, preparing or defending any investigative, administrative, judicial or regulatory action or proceeding in any jurisdiction related to or arising out of such activities, services, alternative, Transaction or role,
whether or not in connection with pending or threatened litigation to which any Indemnified Person is a party, in each case as such expenses are incurred or paid. Syncora will not, however, be responsible for any such Liabilities or expenses to the
extent that they are judicially determined to have resulted from JPMorgan’s bad faith, gross negligence or willful misconduct. Each of WGM and Syncora also agrees that no Indemnified Person shall have any liability (whether direct or indirect,
in contract, tort or otherwise) to WGM or to Syncora or any of its securityholders or creditors, respectively, for or in connection with the Agreement, any alternative or Transaction or JPMorgan’s role or services in connection therewith,
except to the extent that any such Liabilities or expenses incurred by WGM or Syncora, respectively, are judicially determined to have resulted from JPMorgan’s bad faith, gross negligence or willful misconduct. In no event shall Syncora or any
Indemnified Person be responsible for any special, indirect or consequential damages incurred by the other; provided that nothing in this sentence shall be deemed to (i) relieve Syncora of
any obligation it may otherwise have hereunder to indemnify an Indemnified Person for any such damages asserted by an unaffiliated third party or (ii) relieve JPMorgan of any liability it may otherwise have hereunder to WGM or Syncora for any such
damages which WGM or Syncora becomes legally obligated to pay to an unaffiliated third party.

                 (b) Syncora shall not be liable for any settlement of any litigation or proceeding effected without its written consent. Syncora will consult in good faith with JPMorgan prior to entering into any settlement, compromise, consent
to the entry of any judgment in or other termination (collectively, “settlement”) any claim, action or proceeding in respect of which

indemnity may be sought hereunder, if any Indemnified Person is (or it is reasonably foreseeable that it could be) a party thereto, unless such settlement, compromise, consent or termination includes an unconditional release of
each Indemnified Person from any liabilities arising out of such claim, action or proceeding; provided that JPMorgan’s consent to such settlement shall not be required, except with
respect to any such settlement which requires any Indemnified Person to acknowledge any fault or liability. If Syncora enters into any agreement or arrangement with respect to, or effects,
any proposed sale, exchange, dividend or other distribution or liquidation of all or substantially all of its assets in one or a series of transactions, Syncora shall provide for the assumption of its obligations under this Section 1 by the
purchaser or transferee of such assets or another party reasonably satisfactory to JPMorgan. 

                 (c)  If the foregoing indemnification is unavailable or insufficient to hold an Indemnified Person harmless in respect of any Liabilities (or related expenses) referred to therein then, in lieu of indemnifying such Indemnified
Person hereunder, Syncora shall contribute to the amount paid or payable by such Indemnified Person as a result of such Liabilities (and related expenses) in such proportion as is appropriate to reflect (i) the relative fault of each of Syncora and
JPMorgan, and any other relevant equitable considerations, and (ii) unless such Liabilities or expenses are judicially determined to have resulted from JPMorgan’s bad faith, gross negligence or willful misconduct, the relative benefits to
Syncora, on the one hand, and JPMorgan, on the other hand, of any alternatives or Transactions (whether or not any Transaction is consummated); provided, however, that except to the extent that any such Liabilities or expenses are judicially determined to have resulted from JPMorgan’s bad faith, gross negligence or willful misconduct, in no event shall
the Indemnified Persons be required to contribute an aggregate amount in excess of the aggregate amount of fees actually received by JPMorgan under the Engagement Letter. For the purposes of this Agreement, the relative benefits to Syncora and
JPMorgan of the Transaction shall be deemed to be in the same proportion as (i) the total value paid or contemplated to be paid or received or contemplated to be received by Syncora or its securityholders, as the case may be, in connection with any
Alternatives or Transactions that are the subject of the Engagement Letter, whether or not any such Transaction is consummated, bears to (ii) the fees paid or to be paid to JPMorgan under the Engagement Letter. 

               Section 2. Financial Advisory Role, Information, Reliance, Confidentiality, etc.

               (a) Syncora understands that JPMorgan is acting solely as a financial advisor, is acting as an independent contractor and is not undertaking to provide any legal, accounting or tax advice in
connection with its engagement under the Agreement and that JPMorgan’s role in any due diligence will be limited solely to performing such review as it shall deem necessary to support its own advice and analysis and shall not be on behalf of
Syncora. 

               (b) Syncora agrees to provide to JPMorgan all information reasonably requested by JPMorgan for the purpose of its engagement under the Agreement and also to provide reasonable access to employees and
directors of Syncora. Syncora also agrees that upon closing of any Transaction, Syncora shall notify JPMorgan, in writing, whether it expects to treat the consummated Transaction as a “reportable transaction” within the meaning of Treasury
Regulation Section 1.6011 -4(b), and, if so, shall identify the applicable category of “reportable transaction”.  JPMorgan shall be entitled to rely upon and assume, without any obligation of independent verification, the accuracy and
completeness of all information that is publicly

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available and of all information that has been furnished to it by Syncora, any Counterparty or any other party to any Transaction or otherwise reviewed by JPMorgan, and JPMorgan shall not assume any responsibility or have any
liability therefor. JPMorgan has no obligation to conduct any appraisal of any assets or liabilities or to evaluate the solvency of Syncora, any Counterparty or any other party to a Transaction under any state or federal laws relating to bankruptcy,
insolvency or similar matters.

               (c) In order to enable JPMorgan to bring relevant expertise to bear on its engagement under the Agreement from among its global affiliates, Syncora agrees that JPMorgan may share information obtained
from Syncora hereunder with its affiliates, and may perform the services contemplated hereby in conjunction with its affiliates, and that any JPMorgan affiliates performing services hereunder shall be entitled to the benefits and subject to the
terms of the Agreement. Syncora agrees that, following closing of any Transaction, JPMorgan may, at its option and expense, place an advertisement or announcement in such newspapers and periodicals as it may determine describing JPMorgan’s role
as financial advisor, provided that Syncora is provided notice of such advertisement or announcement and the opportunity to approve the content of same. Syncora agrees that any press release
it may issue announcing any Transaction will contain a reference to JPMorgan’s role as financial advisor in connection with such Transaction, and that JPMorgan shall have the right to review and pre-approve any reference to it or its role as
financial advisor under the Agreement in any public statement made by Syncora (such approval not to be unreasonably withheld or delayed). 

               (d) JPMorgan’s financial advice is intended solely for the benefit and use of WGM and may be shared with the senior management and the Board of Directors of Syncora and is not on behalf of, and
shall not confer rights or remedies upon, any shareholder or creditor of Syncora or any other person, and may not be used or relied upon for any other purpose. Except as otherwise required by applicable law or governmental, stock exchange
regulation, each of WGM and Syncora will treat JPMorgan’s advice and the terms of the Agreement as confidential and will not disclose them to any third party (other than, on a confidential basis, to Syncora’s counsel and other advisors in
connection with a Transaction, it being understood that Syncora will be responsible for any breach by such counsel or advisors of the provisions of this sentence) in any manner without JPMorgan’s prior written approval; provided, that Syncora may refer to JPMorgan’s role and disclose its advice rendered hereunder in any Form 8-K which Syncora is required to file with the Securities and Exchange Commission (and any
related press release) relating to the Agreement or any Transaction contemplated by the Engagement Letter, so long as JPMorgan shall have pre-approved any such description of such role and advice (such approval not to be unreasonably withheld or
delayed). 

                 (e) (i) Information provided by Syncora to JPMorgan in connection with this Agreement, including but not limited to any information provided in connection with the Screening Transactions (as defined in Section 3 hereof) and any
advice rendered or reports, drafts, written evaluations, and analyses or other findings, summaries, or work papers (collectively the “Reports”) that JPMorgan prepares or generates
in connection with any services performed by JPMorgan pursuant to the Engagement Letter (collectively, “Confidential Information”), will be kept confidential and will only be used
by JPMorgan for purposes of its engagement hereunder and not for any other purpose (including any legal proceeding, unless JPMorgan receives a subpoena or other validly issued administrative or judicial process

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requesting Confidential Information, or if JPMorgan is required or requested to disclose any Confidential Information under judicial order or regulatory or statutory requirement or request, in which event the procedures set forth
in Section 2(e)(ii) shall apply); provided that the term Confidential Information shall not include any information that (A) was in JPMorgan’s possession prior to its disclosure by
Syncora; (B) is publicly disclosed other than by JPMorgan in violation of the Agreement; (C) is obtained by JPMorgan from a person other than Syncora who, to the knowledge of JPMorgan, is not bound by a confidentiality agreement with Syncora; or (D)
Syncora agrees may be disclosed.  Subject to JPMorgan’s compliance with Section 2(e)(iv) below, JPMorgan’s obligations under this Section 2(e)(i) shall terminate three years from the date hereof.

                 (ii)  If JPMorgan receives a subpoena or other validly issued administrative or judicial process requesting Confidential Information, or if JPMorgan is required or requested to disclose any Confidential Information under
judicial order or regulatory or statutory requirement or request, JPMorgan shall (to the extent legally permissible) promptly notify Syncora in writing, so that Syncora may seek a protective order or other appropriate remedy or, in Syncora’s
sole discretion, waive compliance with the terms of this Section 2(e); provided that the notice provisions of this Section 2(e)(ii) shall not apply to any disclosure pursuant to any routine
regulatory review of JPMorgan or any of its affiliates by any governmental agency or other regulatory body with jurisdiction over JPMorgan or such affiliate, so long as such review is not specifically targeted at Syncora or any Transaction.
Furthermore, if Syncora seeks such a protective order or other appropriate remedy, JPMorgan and its Representatives will not oppose such efforts and will provide Syncora with such assistance and cooperation as Syncora may reasonably request in
taking available protective action prior to complying with such disclosure requirement.  In the event that no such protective order or other remedy is obtained, or that Syncora waives compliance with the terms of this Section 2(e), JPMorgan will
furnish only that portion of the Confidential Information that JPMorgan is advised by legal counsel is legally required to be disclosed.

                 (iii) In addition, JPMorgan may disclose Confidential Information to those of its own and its affiliates’ respective officers, directors, employees, representatives, auditors and professional advisors (collectively,
“Representatives”) who need to know such information for purposes of performing the services described in the Agreement, on the condition that such Representatives comply with
JPMorgan’s obligations under this Section 2(e) (it being understood that JPMorgan will be responsible for any breach of this provision by such Representatives), and to potential parties to any Transaction who have executed confidentiality
agreements with or for the benefit of Syncora in a form reasonably satisfactory to Syncora.

                 (iv)  JPMorgan agrees that, upon Syncora’s written request, JPMorgan shall promptly destroy or return to Syncora all Confidential Information; provided, that
JPMorgan may retain, in a secure location, a copy of such documents and records for purposes of defending any legal proceeding or as is required to be maintained in order to satisfy any law, rule, or regulation to which JPMorgan is subject;
provided, further, that JPMorgan shall maintain the confidentiality of the Confidential Information contained therein in accordance with the confidentiality provisions of Section 2(e)(i)
above for so long as such documents and records remain in JPMorgan’s possession, notwithstanding the last sentence of such Section 2(e)(i).

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                 (v) JPMorgan shall not prepare written reports, memoranda or status summaries except as directed by WGM. All work product that JPMorgan prepares in connection with any services performed hereunder shall be prepared at the
direction of WGM, shall be addressed to WGM and shall be prominently labeled “PRIVILEGED AND CONFIDENTIAL; ATTORNEY WORK PRODUCT.” Any Reports shall be construed as confidential attorney work product. To the extent that any written
reports, memoranda or status summaries prepared prior to the execution of the Agreement have not been prominently labeled “PRIVILEGED AND CONFIDENTIAL; ATTORNEY WORK PRODUCT” or prepared at the direction of or addressed to WGM, it shall
not constitute a violation of the terms of the Agreement.

               (f)   Notwithstanding any other provision herein, Syncora and each of its employees, representatives or other agents may disclose to any and all persons, without limitation of any kind, the U.S.
income and franchise tax treatment and the U.S. income and franchise tax structure of the transactions contemplated hereby and all materials of any kind (including opinions or other tax analyses, if any) that are provided to Syncora relating to such
tax treatment and tax structure insofar as such treatment and/or structure relates to a U.S. income or franchise tax strategy, if any, provided to Syncora by JPMorgan or its affiliates.

               Section 3. Other Business Relationships.

                 (a) Syncora understands that Morgan and its affiliates (collectively, “Morgan”) comprise a full service securities firm and a commercial bank engaged in
securities trading and brokerage activities, as well as providing investment banking, asset management, financing, and financial advisory services and other commercial and investment banking products and services to a wide range of corporations and
individuals. In the ordinary course of our trading, brokerage, asset management, and financing activities, Morgan may at any time hold long or short positions, and may trade or otherwise effect transactions, for its own account or the accounts of
customers, in debt or equity securities or senior loans of Syncora, any Counterparty or any other company that may be involved in any alternative or Transaction. Morgan recognizes its responsibility for compliance with federal securities laws in
connection with such activities. 

                 (b) In addition, Morgan may have and may in the future have investment and commercial banking, trust and other relationships with parties other than Syncora, which parties may have interests with respect to Syncora, the
Portfolio or any Contract or underlying assets, any Counterparty, any alternative or any Transaction or any other party thereto. Without limiting the foregoing, Syncora acknowledges that, in agreeing to provide the advisory services contemplated by
the Agreement, JPMorgan reserves the right of Morgan, subject to JPMorgan’s compliance with Section 2(e) above and Section 3(d) below, to pursue opportunities to arrange and/or provide new financing to other potential parties to a transaction
with Syncora specifically in connection with such transaction. Syncora acknowledges its understanding that the interests of Morgan in its capacity as arranger and/or provider of financing to such potential parties may differ from those of Syncora
with respect to the timing, pricing and terms and conditions of such a transaction and otherwise, and Syncora expressly waives any conflicts of interest which may result from JPMorgan’s multiple roles as advisor to Syncora hereunder and as an
arranger and/or provider (or an affiliate to such an arranger or provider) of financing to other potential parties to transactions with Syncora.  Notwithstanding anything contained
herein, during the term of the

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Agreement, Morgan shall not act as M&A financial advisor to any party (other than Syncora) in connection with any Transaction with respect to which JPMorgan is acting as financial advisor. Although Morgan in the course of its
other relationships may acquire information about the Portfolio’s Contracts or underlying assets, any Counterparty, any alternative, any Transaction or such other parties, Morgan shall have no obligation to disclose such information, or the
fact that Morgan is in possession of such information, to Syncora or to use such information on Syncora’s behalf.  Furthermore Morgan may have fiduciary or other relationships whereby Morgan may exercise voting power over securities of various
persons, which securities may from time to time include securities of Syncora, any Counterparty or others with interests with respect to an alternative or Transaction. Syncora acknowledges that Morgan may exercise such powers and otherwise perform
its functions in connection with such fiduciary or other relationships without regard to its relationship to Syncora hereunder. 

                (c)  Syncora also acknowledges its understanding that, subject to JPMorgan’s compliance with Section 2(e) above and Section 3(d) below, certain of JPMorgan or one of its affiliates, in their
principal capacity (JPMorgan and such affiliates, in such capacity, collectively, the “Morgan Principal”) are involved with and/or are parties to the GreenPoint Mortgage Funding
Trust 2007-HE1, Mortgage-Backed Notes, Series 2007-HE-1 and the Jefferson County, Alabama transactions to which Syncora is a party (the “Screening Transactions”) and may, in the
future, be parties to additional transactions involving Syncora. Syncora acknowledges its understanding that the interests of the Morgan Principal may differ from those of Syncora with respect to the pricing and terms, obligations and conditions of
the Screening Transaction (including potential claims or litigation relating to the Screening Transactions) or such other transactions or otherwise, and Syncora expressly waives any conflicts of interest which may result from JPMorgan’s
multiple roles as advisor to Syncora hereunder and as an affiliate of the Morgan Principal. In addition, Syncora acknowledges its understanding that neither JPMorgan’s engagement under the Engagement Letter nor any advice or recommendation
rendered by JPMorgan hereunder shall be deemed a representation that the Morgan Principal would agree to participate in any transaction structured in accordance with such advice or to affect or impair any rights the Morgan Principal may have in its
capacity as a counterparty to the Screening Transactions or such other transactions referred to above. 

                 (d) JPMorgan confirms that Morgan has in place policies and procedures which are designed to identify, analyze and manage conflicts of interest which may arise as a result of its multiple relationships with clients around the
world who may have competing interests in respect of a particular transaction.  In addition, Morgan has in place compliance policies and procedures, consistent with those of other bulge bracket investment banks, which monitor the receipt of client
confidential information and restrict the dissemination of such confidential information from the private side to public side areas of the firm (“chinese wall” policies) and within the private side of the firm, except on a “need to
know” basis. The foregoing policies and procedures are maintained and monitored by Morgan’s internal Conflicts Office and Compliance Department, in coordination with the Morgan Legal Department and will be applied to JPMorgan’s role
as financial advisor under the Engagement Letter.  Specifically, JPMorgan agrees that, unless Syncora shall have granted its prior consent with respect thereto, no member of the team of Morgan employees performing services under the Engagement
Letter shall (i) participate on any team of Morgan employees arranging or providing new financing to other

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potential parties to a transaction with Syncora specifically in connection with such transaction (a “Morgan Financing Team”) or act on behalf of the Morgan
Principal in connection with any Screening Transaction or other transaction with Syncora or (ii) provide any Confidential Information to any such Morgan Financing Team or the Morgan Principal.

                 Section 4. Miscellaneous. The Agreement may not be assigned by Syncora, or JPMorgan without the prior written consent of the others. The
Agreement constitutes the entire understanding of the parties with respect to the subject matter thereof, supersedes all prior agreements with respect thereto, may not be amended except in writing signed by both of the parties, has been duly
authorized and executed by each of the parties hereto and constitutes the legal, binding obligation of each such party. The Agreement shall be governed by and construed in accordance with the laws of the State of New York without reference to
principles of conflicts of law. Each of Syncora and JPMorgan irrevocably and unconditionally submits to the exclusive jurisdiction and venue of any State or Federal court sitting in New York City over any action, suit or proceeding arising out of or
relating to this Agreement. Each of Syncora and JPMorgan irrevocably and unconditionally waives any objection to the laying of venue of any such action brought in any such court and any
claim that any such action has been brought in an inconvenient forum. JPMorgan and Syncora (on its own behalf and, to the extent permitted by law, on behalf of its shareholders) each waives any right to trial by jury in any action, claim, suit or
proceeding with respect to JPMorgan’s engagement as financial advisor under the Agreement or its role in connection herewith. 

 

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APPENDIX 1a

  The use of the following notation in this exhibit indicates
  that a confidential portion has been omitted pursuant to a request for confidential
  treatment and the omitted material has been filed separately with the Securities
  and Exchange Commission

  [* * *]

 APPENDIX 1b 

    [* * *]

 APPENDIX 1c 

    [* * *]

	APPENDIX 2 

      

      COUNTERPARTIES
	 	 
	 	1.  Canadian
        Imperial Bank of Commerce 

      2.  Dresdner
      Bank AG, London Branch 

      3.  Calyon 

      4.  Société Générale 

      5.  UBS
      AG, London Branch 

      6.  Deutsche
      Bank AG, London Branch 

      7.  Bank
      of America, N.A. 

      8.  Lehman
      Brothers Inc. 

      9.  Barclays
      Bank PLC 

      10.  Nomura
      International plc 

      11.  Natixis 

      12.  Dexia
      Bank Belgium SA 

      13.  Hypo
      Public Finance Bank 

      14.  The
      Royal Bank of Scotland plc 

      15.  Wachovia
      Bank, National Association 

      16.  Australia
      and New Zealand Banking Group Limited

      17.  Royal
    Bank of Canadac55491_ex10-1.htm -- Converted by SEC Publisher, created by BCL Technologies Inc., for SEC Filing

 

  Exhibit 10.2

[EXECUTION VERSION]                    

AMENDED AND RESTATED 

EMPLOYMENT AGREEMENT

          This AGREEMENT (this “Agreement”) is made and entered into as of August 28, 2008 (the “Effective
Date”), by and between, Syncora Holdings Ltd., a Bermuda corporation (the “Company”), and Claude L. LeBlanc (the “Executive”) to amend and restate an existing employment agreement between the parties, dated as of January 1, 2008 (the “Prior Agreement”). 

          WHEREAS, the Executive has been employed by the Company as its Executive Vice President, Corporate Development & Strategy; 

          WHEREAS, the Company has asked the Executive to perform services in addition to those contemplated by, and beyond the scope of, the Prior Agreement, and wishes to compensate the Executive therefor,
and for the successful performance of such services; 

          WHEREAS, the Executive and the Company wish to amend the Prior Agreement to, among other things, bring it into compliance with the requirements of Section 409A of the Internal Revenue Code and the
Treasury Regulations and other official guidance promulgated thereunder; and 

          WHEREAS, the Company has requested the Executive to continue in the employ of the Company in a different capacity that the Company has viewed and continues to view as critical to its restructuring
process, and the Executive has agreed to do so, subject to the terms and conditions set forth in this Agreement, including changes to certain compensation and benefit arrangements, including certain existing rights, all as more specifically set
forth herein; 

          NOW, THEREFORE, in consideration of the premises and mutual covenants contained herein and for other good and valuable consideration, the Company, and the Executive (the “Parties”) hereby agree as follows: 

          1.      EMPLOYMENT.

          The Company hereby employs the Executive, and the Executive hereby accepts employment with the Company, for the term of this Agreement as set forth in Section 2, below, in the position and with the
duties and responsibilities set forth in Section 3, below, and upon such other terms and conditions as are hereinafter stated. 

          2.      TERM OF EMPLOYMENT.

          The stated term of the Executive’s employment under this Agreement commenced on January 1, 2008 and, from and after the Effective Date, shall continue on a month-to-month basis thereafter (the
“Term”) until terminated for any reason by the Company or by the Executive, in either case, upon 30 days’ prior written notice to the other party. 

          3.      POSITIONS, DUTIES AND RESPONSIBILITIES.

          (a) General. As of the Effective Date, the Executive’s title and position with the Company shall change
from Executive Vice President, Corporate Development & Strategy of the Company to Special Advisor to the Company’s Board of Directors (the “Board”). In such position, the
Executive shall report directly to the Chairman of the Board (the “Chairman”), and the Executive’s duties shall be limited to those duties and responsibilities related to the
Company’s restructuring and related activities (including those described below in this Section 3(a)) that are reasonably requested by the Chairman. The Executive shall have the authority normally associated with a position such as his position
and that is otherwise bestowed upon him by the Chairman. In addition to duties and responsibilities related to the Company’s restructuring, the Executive’s duties and responsibilities shall include, without limitation, (i) working with senior management to develop the Company’s corporate strategy, (ii) overseeing all corporate development activities,
(iii) overseeing capital management and pricing model development, and (iv) managing rating agency relations. During the Term, the
Executive shall devote his full business time to the business and affairs of the Company and its subsidiaries, and shall use his best efforts, skills and abilities to promote the interests of the Company and its subsidiaries; provided, however, the Executive may serve on up to two boards of directors of other entities, so long as such service does not interfere with the
Executive’s performance of his duties hereunder or result in any conflict of interest with the Company. 

          (b) Performance of Services. The Executive’s services under this Agreement, which are global in nature,
shall be performed in Bermuda, however, Executive may be reasonably requested by the Company to perform services elsewhere in accordance with the guidelines established by the Company from time to time for the location of the performance of services
on behalf of the Company and its subsidiaries. The Executive acknowledges that the Company may require the Executive to travel to the extent such travel is reasonably necessary to perform the services hereunder and that such travel may be extensive.
To the extent reasonably requested by the Company, the Executive shall allocate greater business time to a location other than his principal business location, if necessary. 

          (c)      (i)      To the extent that Executive’s service with the Company or any of its Affiliates triggers at any time, and only for tax years from
and after January 1, 2006 and ending on December 31, 2008, an obligation to pay federal, state or local tax in the 

2

United States at any time, including but not limited to taxes imposed under Section 409A and/or Section 4999 of the Code (as defined below), the Company shall indemnify and hold Executive harmless from any such obligations on the
amounts he received from the Company or any of its Affiliates with respect to his employment, that is subject to federal, state or local tax, including any interest and penalties thereon, any reasonable costs incurred by Executive in connection
therewith (including, without limitation, reasonable costs of preparing and filing tax returns, reasonable costs of any audit or other proceeding, and reasonable costs of enforcing his rights hereunder), and a full gross up for any tax required to
be paid with respect to any indemnity payment hereunder. In addition, the foregoing indemnity shall apply with respect to any taxes, interest and penalties with respect to (i) the vesting of the Restricted Shares (as defined below), (ii) the
exercise of any stock options in 2008 and (iii) the Transaction Bonus, the Stay Bonus and the Amendment Payment. No payments other than those set forth in this Section 3(c) shall be subject to the tax indemnity, unless expressly approved by the
Board of Directors. Other than as set forth in this Section 3(c), the Executive shall be responsible for the payment of all taxes, interest and penalties in respect of compensation paid to him for the services to be performed hereunder.
Notwithstanding anything herein to the contrary, this provision shall survive the termination of Executive’s employment. At the Company’s discretion, any payment under this Section 3(c) shall be paid to or for the benefit of the Executive
either (i) not later than the time the Company or one of its Affiliates is required to withhold federal, state or local tax in the United States with respect to the Executive, with respect to the amount required to be so withheld, or (ii) not later
than at least two (2) business days before an amount is paid or required to be paid by the Executive to a taxing authority in the United States, with respect to any other amount; provided that the Company shall notify the Executive of the manner in
which it elects to make such payment at least ten (10) business days prior to the date such payment is required to be made, but, in all events, not later than the end of the taxable year of the Executive next following the taxable year of the
Executive in which the Executive (or the Company, on the Executive’s behalf) remits the related taxes (or, in the event of an audit or litigation with respect to such tax liability under this Section 3(c), not later than the end of the taxable
year of the Executive next following the taxable year of the Executive in which there is a final resolution of such audit or litigation (whether by reason of completion of the audit, entry of a final and non-appealable judgment, final settlement, or
otherwise). 

                (ii)      Notwithstanding the generality of the timing provisions contained in Section 3(c)(i), the parties shall adhere to this Section 3(c)(ii) with respect to the Executive’s estimated tax payment
due on September 15, 2008. On or before September 5, 2008, the Executive’s tax advisor (the “Tax Advisor”) shall deliver to the Company a reasonable and good faith estimate of
the federal, state and local taxes in the United States the Executive is expected to owe with respect to the payments made (or to be made) by the Company to the Executive through September 15, 2008 that are subject to the indemnification provisions
of this Section 3(c) for the Executive’s tax year ending 

3

December 31, 2008 (“Executive’s Estimated Tax Liability”), together with a draft of the statements to be remitted to the relevant taxing authorities showing
the amount of the Executive’s Estimated Tax Liability. Absent manifest error, provided such estimate of the Executive’s Estimated Tax Liability and supporting statements are so delivered, the Company shall remit payment in the amount of
the Executive’s Estimated Tax Liability to the Tax Advisor on or before September 10, 2008 in the same manner as it has previously remitted similar payments to the Tax Advisor (for the purposes of being paid to the federal, state and local tax
authorities in the United States on behalf of the Executive).

                (iii)      To the extent that the amount of the Company’s liability to the Executive under this Section 3(c) is determined to be less than the aggregate amount remitted to the Tax Advisor for the
Executive’s estimated tax liability for the tax year ending December 31, 2008, the Executive shall promptly advise the Company of such fact promptly after such determination is made, and the Executive agrees that he will refund such difference
to the Company within ten days following the date on which the Executive’s federal, state and local tax liability in the United States for the tax year ending December 31, 2008 is final and fixed. 

          4.      BASE SALARY.

          The Executive shall be paid an annual base salary by the Company (a “Base Salary”) at a rate of US$432,000 for the calendar year 2008 following the Effective Date, payable in accordance
with the Company’s regular pay practices. Such Base Salary shall be subject to annual review in accordance with the Company’s practices for executives as in effect from time to time and may be increased at the discretion of the
Compensation Committee of the Board of Directors of the Company (the “Compensation Committee”). 

          5.      BONUSES.

          (a) In addition to the Base Salary provided for in Section 4, above, the Executive shall be eligible for an annual cash bonus under the
Company’s Annual Incentive Compensation Plan as in effect from time to time. Any annual bonus shall be paid in cash in a lump sum no later than March 15 following the year for which the annual bonus is paid, unless timely deferred at the
Executive’s option in accordance with the provisions of any applicable deferred compensation plan of the Company or it subsidiaries in effect from time to time and in accordance with Section 409A of the Code. Nothing in this Section 5 shall
confer upon the Executive any right to a minimum annual bonus. Executive also shall be eligible to participate in the Company’s long term incentive award plan commencing with the year 2007 in accordance with the terms of that plan. The
Executive may be awarded such annual bonuses and long-term incentive awards thereunder as may be approved by the Compensation Committee in its discretion based on corporate, individual and business unit performance measures, as appropriate,
established or approved from time to time, by the Compensation Committee. 

4

          (b) Further, on December 19, 2007 Executive was awarded a grant of 100,000 options (the “Options”) to vest ratably over three years, vesting to occur at the rate of 33.33% each year on the anniversary of the grant date. In addition, Executive has been awarded a grant of 50,000 restricted
shares (the “Restricted Shares”) to vest ratably over four years, vesting to occur at the rate of 25% each year on the anniversary of the grant date. Such Options and Restricted
Shares shall vest in full on the earlier of a Change in Control (as defined in Exhibit A) or on the Stay Date (as defined below) so long as the Executive has not had a Disqualifying Termination prior to such vesting date. 

          (c) In recognition of the efforts of the Executive with respect to the negotiation, execution and consummation of the transactions contemplated by the Master Transaction Agreement, dated July 28,
2008, among the Company and several of its subsidiaries, XL Capital Ltd and certain of its affiliates and certain financial institutions, the Company shall pay the Executive, within three business days after the Effective Date, a lump sum cash
payment of US$1,500,000 (the “Transaction Bonus”). 

          (d) Because the Company views the Executive’s services through at least October 31, 2008 (the “Stay Date”) as critical to its
restructuring process, the Company shall pay the Executive within three business days after the Effective Date, a lump sum cash payment of US$550,000 (the “Stay Bonus”).

          (e) In addition, in consideration of the Executive’s agreement to the Release and Non-Compete provisions set forth herein and waiver of certain rights, the Executive shall be entitled to an
additional payment (the “Amendment Payment”) in the amount of US$1,250,000, payable in a lump sum cash payment within three business days after the Effective Date, the
Executive agrees that upon receipt of such payment, he shall irrevocably waive and forfeit any further right or entitlement to the following amounts: (i) any payments pursuant to the Company’s Offer to Exchange, dated November 13, 2006, (ii)
any retention payments not previously paid or indefeasibly earned, except to the extent provided herein, (iii) any other severance payments previously agreed to by the Company under the Prior Agreement, (iv) any vested or unvested options to
purchase Company common stock other than the Options, and (iv) any housing benefit payable from and after the Effective Date. 

          (f) Notwithstanding any other provision in this Agreement, in the event the Executive’s employment with the Company is terminated before the Stay Date (i) by the Company by reason of the
conviction of the Executive of a felony involving moral turpitude, dishonesty, or violation of laws to which the Company or its Affiliates are subject in connection with the conduct of its or their business or (ii) by the Executive other than for
Good Reason (as defined in Exhibit B) (each, a “Disqualifying Termination”), then the Executive agrees to repay the Stay
Bonus and the Amendment Payment to the Company within three days after the effective date of such Disqualifying Termination. For avoidance of doubt, a termination of the Executive’s employment by 

5

reason of the Executive’s death or disability (as defined in the long-term disability plan of the Company) will not be deemed a Disqualifying Termination. 

          (g) The Executive further agrees simultaneously with entering into this Agreement (but with the effectiveness thereof to be conditioned on the receipt of the payments mentioned in Subsections (c), (d)
and (e), above), to execute and deliver the General Release and Consent Not to Sue (the “Release”) attached as Exhibit C. For avoidance of doubt, the Parties acknowledge and agree
that the Release does not waive or release (a) any rights under this Agreement, (b) any right to any vested or accrued benefits (except as set forth in this Agreement) or to claim benefits under employee benefit plans (including welfare benefit,
retirement and, except as set forth in the Agreement, equity-related plans), (c) any right of indemnification (including, without limitation, indemnification, legal defense and related rights under the Company’s certificate of incorporation,
by-laws or other such organic documents), and (d) any rights under directors and officers’ liability insurance policies. 

          6.      EMPLOYEE BENEFIT PROGRAMS.

          During the term of the Executive’s employment under this Agreement, the Executive shall be entitled to participate in all employee retirement, pension, welfare and benefit programs of the Company
as are in effect from time to time and in which senior executives of the Company whose services are performed in Bermuda are eligible to participate. The Executive acknowledges that the Company intends that, no later than December 31, 2008, it will
no longer provide any such programs to employees whose services are performed in Bermuda. With respect to medical benefits, upon termination of the Executive’s employment, or if earlier, on December 31, 2008, the Executive shall receive a lump
sum cash payment equal to the monthly premium cost to the Company (which is currently US$1,106.72) for providing medical benefits to the Executive multiplied by the difference between 24 and the number of months of service performed by the
Executive from the Effective Date through the date of such termination or December 31, 2008 (whichever is earlier). 

          7.      BUSINESS EXPENSE REIMBURSEMENT AND FRINGE BENEFITS.

          During the term of the Executive’s employment under this Agreement, the Executive shall be entitled to participate in the Company’s travel and entertainment expense reimbursement programs in
accordance with the terms and conditions of such programs as in effect from time to time, provided, however, in all events, any business expense reimbursement under this Section 7 shall be made to the Executive by not later than the last day of the
Executive’s taxable year following the taxable year in which the expense was incurred. 

          In addition, during the term of the Executive’s employment under this Agreement, the Executive shall be entitled to participate in the Company’s fringe benefit plans and 

6

arrangements made available to employees of the Company whose services are performed in Bermuda. The Executive acknowledges that the Company intends that, no later than December 31, 2008, it will no longer provide any such fringe
benefit plans or arrangements to employees whose services are performed in Bermuda. 

          8.      [INTENTIONALLY OMITTED].

          9.      EXCISE TAX PAYMENTS. 

          (a) Anything in this Agreement to the contrary notwithstanding, in the event it shall be determined that (i) any payment or distribution made, or benefit provided (including, without limitation, the acceleration of any payment, distribution or benefit or accelerated vesting or exercisability of any award) by
the Company to or for the benefit of the Executive (whether paid or payable or distributed or distributable pursuant to the terms of this Agreement or otherwise, but determined without regard to any additional payments required under this Section 9)
(a “Payment”) would be subject to the excise tax imposed by Section 4999 of the United States Internal Revenue Code of 1986, as amended (the “Code”) (or any successor provision or similar excise tax), and/or any interest or penalties are incurred by the Executive with respect to such excise tax (such excise tax, together with any such
interest and penalties, are hereinafter collectively referred to as the “Excise Tax”), (ii) the aggregate amount of the
Executive’s Parachute Payments (as defined in Section 280G(b)(2)(A) of the Code) is less than 3.25 times the Executive’s Base Amount (as defined in Section 280G(b)(3)(A) of the Code), and (iii) no such Payment would be subject to the Excise Tax if the payments set forth in Section 8(d)(iii)(B) and (C) hereof were each reduced by up to 20 percent, then the payments set forth in Section 8(d)(iii)(B) and (C) will each be
reduced to the smallest extent possible (and in no event by more than 20 percent in the aggregate) such that no Payment is subject to the Excise Tax. 

          (b) Anything in this Agreement to the contrary notwithstanding, in the event it shall be determined that (i) the aggregate amount of the Executive’s Parachute Payments equals or exceeds 3.25 times the Executive’s Base Amount, (ii) the
aggregate amount of the Executive’s Parachute Payments is less than 3.25 times the Base Amount but one or more Payments would be subject to the Excise Tax even if the payments set forth in Section 8(d)(iii)(B) and (C) hereof were each reduced
by 20 percent, or (iii) notwithstanding a reduction in payments pursuant to Section 9(a) above, an Excise Tax is payable by the Executive on one or more Payments, then, in any such case,
Payments shall not be reduced and the Executive shall be entitled to receive an additional payment (a “Gross-Up Payment”) in an amount such that after payment by the Executive of
all taxes (including any income or Excise Tax) imposed upon the Gross-Up Payment and any interest or penalties imposed with respect to such taxes, the Executive retains from the Gross-Up Payment an amount equal to the Excise Tax imposed upon the
Payments. 

7

          (c) Subject to the provisions of Section 9(d), all determinations required to be made under this Section 9, including determination of whether
a Gross-Up Payment is required and of the amount of any such Gross-Up Payment, shall be made by a nationally recognized public accounting firm selected by the Company (the “Accounting Firm”) which shall provide detailed supporting calculations both to the Company and the Executive within 15 business days of the date of termination of the Executive’s employment, if applicable, or such earlier time as is
reasonably requested. The initial Gross-Up Payment, if any, as determined pursuant to this Section 9(c), shall be paid to the Executive within five business days of the receipt of the Accounting Firm’s determination and, in all events, within
30 days of the date of the Executive’s termination of employment with the Company. If the Accounting Firm determines that no Excise Tax is payable by the Executive, it shall furnish the Executive with a written opinion that he has substantial
authority not to report any Excise Tax on his Federal income tax return. Any determination by the Accounting Firm meeting the requirements of this Section 9(c) shall be binding upon the Company and the Executive, subject only to payments pursuant to
the following sentence based on a determination that additional Gross-Up Payments should have been made, consistent with the calculations required to be made hereunder (the amount of such additional payments are referred to herein as the
“Gross-Up Underpayment”). In the event that the Company exhausts its remedies pursuant to Section 9(d) and the Executive
thereafter is required to make a payment of any Excise Tax, the Accounting Firm shall determine the amount of the Gross-Up Underpayment that has occurred and any such Gross-Up Underpayment shall be promptly paid by the Company to or for the benefit
of the Executive. The fees and disbursements of the Accounting Firm shall be paid by the Company. 

          (d) The Executive shall notify the Company in writing of any claim by the United States Internal Revenue Service that, if successful, would
require the payment by the Executive of any Excise Tax and, therefore, the payment by the Company of a Gross-Up Payment. Such notification shall be given as soon as practicable but not later than 30 business days after the Executive receives written
notice of such claim and shall apprise the Company of the nature of such claim and the date on which such claim is requested to be paid. The Executive shall not pay such claim prior to the expiration of the 30-day period following the date on which
he gives such notice to the Company (or such shorter period ending on the date that any payment of taxes with respect to such claim is due). If the Company notifies the Executive in writing prior to the expiration of such period that it desires, in
good faith, to contest such claim (which notice shall set forth the bases for such contest) and that it will bear the costs and provide the indemnification as required by this sentence, the Executive shall, in good faith: 

          (i)      give the Company any information reasonably requested by the Company relating to such claim, 

8

          (ii)      take such action in connection with contesting such claim as the Company shall, in good faith, reasonably request in writing from time to
time, including, without limitation, accepting legal representation with respect to such claim by an attorney selected by the Company and reasonably acceptable to the Executive, 

          (iii)      cooperate with the Company in good faith in order effectively to contest such claim, and 

          (iv)      permit the Company to participate, in good faith, in any proceedings relating to such claim;

provided, however, that the Company shall bear and pay directly all costs and expenses (including additional interest and penalties)
incurred in connection with such contest and shall indemnify and hold the Executive harmless, on an after-tax basis to the Executive, for any Excise Tax or income tax, including interest and penalties with respect thereto, imposed as a result of
such representation and payment of all costs and expenses. 

          Without limitation on the foregoing provisions of this Section 9(d), the Company shall, exercising good faith, control all proceedings taken in connection with such contest and, at its sole option
(but in good faith), may pursue or forego any and all administrative appeals, proceedings, hearings and conferences with the taxing authority in respect of such claim and may, at its sole option (but in good faith), either direct the Executive to
pay the tax claimed and sue for a refund or contest the claim in any permissible manner, and the Executive agrees to prosecute such contest to a determination before any administrative tribunal, in a court of initial jurisdiction and in one or more
appellate courts, as the Company shall determine; provided, however, that if the Company directs the Executive to pay such claim
and sue for a refund, the Company shall advance the amount of such payment to the Executive, on an interest-free basis and shall indemnify and hold the Executive harmless, on an after-tax basis to the Executive, from any Excise Tax or income tax,
including interest or penalties with respect thereto, imposed with respect to such advance or with respect to any imputed income with respect to such advance; and further provided that any extension of the statute of limitations relating to the payment of taxes for the taxable year of the Executive with respect to which such contested amount is claimed to be due is limited
solely to such contested amount. Furthermore, the Company’s control of the contest shall be limited to issues with respect to which a Gross-Up Payment would be payable hereunder and the Executive shall be entitled to settle or contest, as the
case may be, any other issue raised by the Internal Revenue Service or any other taxing authority. If, after the receipt by the Executive of an amount advanced by the Company pursuant to Section 9(d), the Executive becomes entitled to receive any
refund with respect to such claim, the Executive shall (subject to the Company’s complying with the requirements of Section 9(d)) promptly pay to the Company, as the case may be, the amount of such refund (together with any interest paid or
credited thereon after taxes applicable thereto). If, after the receipt by the Executive of

9

an amount advanced by the Company pursuant to Section 9(d), a determination is made that the Executive shall not be entitled to any refund with respect to such claim and the Company does not notify the Executive in writing of its
intent to contest such denial of refund prior to the expiration of 30 days after such determination, then any obligation of the Executive to repay such advance shall be forgiven and the amount of such advance shall offset, to the extent thereof, the
amount of Gross-Up Payment required to be paid. 

          Notwithstanding any provision herein to the contrary, the Executive’s failure to strictly comply with the notice provisions set forth in this Section 9, so long as such failure does not prevent
the Company from contesting an excise tax claim, shall not adversely affect the Executive’s rights under this Section 9. 

          Subject to any earlier time limits set forth in Section 9, all payments and reimbursements to which the Executive is entitled under this Section 9 shall be paid to or on behalf of the Executive not
later than the end of the taxable year of the Executive next following the taxable year of the Executive in which the Executive (or the Company, on the Executive’s behalf) remits the related taxes (or, in the event of an audit or litigation
with respect to such tax liability under Section 9(d), not later than the end of the taxable year of the Executive next following the taxable year of the Executive in which there is a final resolution of such audit or litigation (whether by reason
of completion of the audit, entry of a final and non-appealable judgment, final settlement, or otherwise)). 

          10.      [INTENTIONALLY OMITTED]. 

          11.      NONCOMPETITION AND NONSOLICITATION.

          The Executive represents and warrants that, to the best of his knowledge, he is not using the confidential or proprietary information of any other person in violation of any agreement or rights of
others known to him. The Executive agrees that the products of the Company and its Affiliates shall constitute the exclusive property of the Company and its Affiliates. 

          For the avoidance of doubt, all trademarks, policy language or forms, products or services (including products and services under development), trade names, trade secrets, service marks, designs,
computer programs and software, utility models, copyrights, know-how and confidential information, applications for registration of any of the foregoing and the right to apply for them in any part of the world (whether any of the foregoing shall be
registered or unregistered) created or discovered or participated in by the Executive during the course of his employment (whether or not pursuant to the terms of this Agreement) or under the instructions of the Company or its Affiliates are and
shall be the absolute property of the Company and its Affiliates, as appropriate. Without limiting the foregoing, the Executive hereby assigns to the Company any and all of the Executive’s right, title and interest, if any, pertaining to the
financial products insurance and reinsurance (including, without limitation, finite insurance and reinsurance), risk 

10

assumption, risk management, brokerage, financial and other products or services developed or improved upon by the Executive (including, without limitation, any related “know how”) while employed by the Company or its
Affiliates, including any patent, trademark, trade name, copyright, ownership or other right that may pertain thereto. 

          Since Executive has obtained and is likely to obtain in the course of Executive’s employment with the Company and its Affiliates knowledge of trade names, trade secrets, know-how, products and
services (including products and services under development), techniques, methods, lists, computer programs and software and other confidential information relating to the Company and its Affiliates, and their employees, clients, business or
business opportunities, Executive hereby undertakes that: 

          (i)      Executive will not (either alone or jointly with or on behalf of others and whether directly or indirectly) encourage, entice, solicit or
endeavor to encourage, entice or solicit away from employment with the Company or its Affiliates, or hire or cause to be hired, any officer or employee of the Company or its Affiliates (or any individual who was within the prior twelve months an
officer or employee of the Company or its Affiliates), or encourage, entice, solicit or endeavor to encourage, entice or solicit any individual to violate the terms of any employment agreement or arrangement between such individual and the Company
or any of its Affiliates; 

          (ii)      Executive will not (either alone or jointly with or on behalf of others and whether directly or indirectly) interfere with or disrupt or
seek to interfere with or disrupt (A) the relationships between the Company and its Affiliates, on the one hand, and any customer or client of the Company and its Affiliates, on the other
hand, (including any reinsured party) who during the period of twenty-four months immediately preceding such termination shall have been such a customer or client, or (B) the supply to the
Company and its Affiliates of any services by any supplier or agent or broker who during the period of twenty-four months immediately preceding such termination shall have supplied services to any such person, nor will Executive interfere or seek to
interfere with the terms on which such supply or agency or brokering services during such period as aforesaid have been made or provided; 

          (iii)      Executive will not (either alone or jointly with or on behalf of others and whether directly or indirectly) whether as an employee,
consultant, partner, principal, agent, distributor, representative or stockholder (except solely as a less than one percent stockholder of a publicly traded company), engage in any activities in Bermuda, the United Kingdom or the United States if
such activities are competitive with the businesses that (i) are then being conducted by the Company or its Affiliates and (ii)
during the period of the Executive’s employment were either being conducted by the Company or its Affiliates or actively being developed by the Company or its Affiliates; and 

11

          (iv)     Executive will not (either alone or jointly with or on behalf of others and whether directly or indirectly) whether as an employee, consultant, partner, principal, agent, distributor,
representative or stockholder assist any person or group in the acquisition or proposed acquisition of all or any part of the Company or any of its Affiliates, or any of its or their lines of business or assets, (including without limitation, all
preparatory steps antecedent to an acquisition or proposed acquisition, such as preparation of valuations, financial models, management analysis or other evaluative materials). 

          The provisions of the immediately preceding sentence shall continue as long as the Executive is employed by the Company or its Affiliates and such provisions shall continue in effect after such
employment is terminated for any reason until the first anniversary of such termination, provided, however, that, following a
Change in Control, the foregoing clause (iii) shall be limited solely to the financial guaranty insurance business as historically conducted by the Company and its Affiliates prior to the Effective Date.

          For purposes of this Agreement, an “Affiliate” of the Company means any person, directly or indirectly, through one or more intermediaries, controlled by the Company, and such term shall
specifically include, without limitation, the Company’s majority-owned subsidiaries. 

          The limitations on the Executive set forth in this Section 11 shall also apply to any agent or other representative acting on behalf of Executive. 

          While the restrictions aforesaid are stated to be reasonable in all the circumstances it is also recognized that restrictions of the nature in question may fail for reasons unforeseen and accordingly
it is hereby declared and agreed that if any of such restrictions or the geographic or other scope thereof shall be adjudged to be void as going beyond what is reasonable in the circumstances for the protection of the interests of the Company and
its Affiliates but would be valid if part of the wording thereof were deleted and/or the periods (if any) thereof reduced and/or geographic or other area dealt with thereby reduced in scope then said restrictions shall apply with such modifications
as may be necessary to make them valid and effective. 

          Nothing contained in this Section 11 shall limit in any manner any additional obligations to which Executive may be bound pursuant to any other agreement or any applicable law, rule or regulation and
Section 11 shall apply, subject to its terms, after employment has terminated for any reason. 

          12.      CONFIDENTIAL INFORMATION.

The Executive covenants that he shall not, without the prior written consent of the Company,
use for the Executive’s own benefit or the benefit of any other person or
entity

12

other than the Company and its Affiliates or disclose to any person, other than an employee of the Company or other person to whom disclosure is necessary to the performance by the Executive of his duties in the employ of the
Company, any confidential, proprietary, secret, or privileged information about the Company or its Affiliates or their business or operations, including, but not limited to, information concerning trade secrets, know-how, software, data processing
systems, policy language and forms, inventions, designs, processes, formulae, notations, improvements, financial information, business plans, prospects, referral sources, lists of suppliers and customers, legal advice and other information with
respect to the affairs, business, clients, customers, agents or other business relationships of the Company or its Affiliates. Executive shall hold in a fiduciary capacity for the benefit of the Company all secret, confidential proprietary or
privileged information or data relating to the Company or any of its Affiliates or predecessor companies, and their respective businesses, which shall have been obtained by Executive during his employment, unless and until such information has
become known to the public generally (other than as a result of unauthorized disclosure by the Executive) or unless he is required to disclose such information by a court or by a governmental body with apparent authority to require such disclosure.
The foregoing covenant by the Executive shall be without limitation as to time and geographic application and this Section 12 shall apply in accordance with its terms after employment has terminated for any reason. The Executive acknowledges and
agrees that he shall have no authority to waive any attorney-client or other privilege without the express prior written consent of the Compensation Committee as evidenced by the signature of the Company’s General Counsel. 

          13.      WITHHOLDING.

          Anything in this Agreement to the contrary notwithstanding, all payments required to be made by the Company hereunder to the Executive shall be subject to withholding of such amounts relating to taxes
as the Company may reasonably determine should be withheld pursuant to any applicable law or regulation. In lieu of withholding such amounts, in whole or in part, the Company may, in its sole discretion, accept other provision for payment of taxes
as required by law, provided it is satisfied that all requirements of law affecting its responsibilities to withhold such taxes have been satisfied. 

          14.      SUBSIDIARY SERVICES AND GUARANTEE.

          (a) Each of the Company, Syncora Guarantee Re Ltd. and Syncora Holdings US Inc. (together, the “Guarantors”) hereby agrees to be jointly and severally liable, together with the Company, for the performance of all obligations and duties, and the payment of all amounts, due to the Executive under
this Agreement. 

          (b) All of the terms and provisions of this Agreement relating to the Executive’s employment by the Company shall likewise apply mutatis
mutandis to the Executive’s 

13

employment by any of its subsidiaries, it being understood that if the Executive’s employment with the Company is terminated, his employment with its subsidiaries shall also be terminated and the Executive shall be required
to resign immediately from all directorships and other positions held by the Executive in the Company and its subsidiaries or in any other entities in respect of which the Executive was acting as a representative or designee of the Company or its
subsidiaries in connection with his employment. 

          15.      ENTIRE AGREEMENT.

          This Agreement, together with the Exhibits, contains the entire agreement between the Parties concerning the subject matter hereof and supersedes all prior agreements, understandings, discussions,
negotiations and undertakings, whether written or oral, between the Company and the Executive with respect thereto, including, without limitation, the Prior Agreement. 

          16.      ASSIGNABILITY; BINDING NATURE.

          This Agreement shall be binding upon and inure to the benefit of the Parties and their respective successors, heirs and assigns. No rights or obligations of the Executive under this Agreement may be
assigned or transferred by the Executive other than his right to compensation and benefits hereunder, which may be transferred by will or operation of law subject to the limitations of this Agreement. No rights or obligations of the Company under
this Agreement may be assigned or transferred by the Company except that such rights or obligations may be assigned or transferred pursuant to a merger or consolidation or amalgamation or scheme of arrangement in which the Company is not the
continuing entity, or the sale or liquidation of all or substantially all of the assets of the Company, provided that the assignee or transferee is the successor to all or substantially all of the assets of the Company and such assignee or
transferee assumes by operation of law or in writing duly executed by the assignee or transferee all of the liabilities, obligations and duties of the Company, as contained in this Agreement, either contractually or as a matter of law. 

          17.      INDEMNIFICATION.

          The Executive shall be provided indemnification by the Company to the maximum extent permitted by applicable law and its charter documents and consistent with the indemnification provided to the most
senior officers of the Company. In addition, he shall be covered by a directors’ and officers’ liability policy with coverage for all directors and officers of the Company in an amount equal to at least US$30,000,000. Such
directors’ and officers’ liability insurance shall be maintained in effect for a period of six years following termination of the Executive’s employment. 

14

          18.      SETTLEMENT OF DISPUTES.

          (a) Any dispute between the Parties arising from or relating to the terms of this Agreement or the Executive’s employment with the Company
or its Affiliates shall, except as provided in Section 18(b) or Section 18(c), be resolved by binding arbitration held in New York City in accordance with the rules of the American Arbitration Association. 

          (b) Executive acknowledges that the Company and its Affiliates will suffer irreparable injury, not readily susceptible of valuation in monetary
damages, if Executive breaches his obligations under Section 11 or 12. Accordingly, Executive agrees that the Company and its Affiliates will be entitled, in addition to any other available remedies, to obtain injunctive relief against any breach or
prospective breach by Executive of his obligations under Section 11 or 12 in any Federal or state court sitting in the City and State of New York or court sitting in Bermuda or the United Kingdom, or, at the Company’s or any Affiliate’s
election, in any other jurisdiction in which Executive maintains his residence or his principal place of business. Executive hereby submits to the non-exclusive jurisdiction of all those courts for the purposes of any actions or proceedings
instituted by the Company or its Affiliates to obtain such injunctive relief, and Executive agrees that process in any or all of those actions or proceedings may be served by registered mail or delivery, addressed to the last address of Executive
known to the Company or its Affiliates, or in any other manner authorized by law. Executive further agrees that, in addition to any other remedies available to the Company or its Affiliates by operation of law or otherwise, because of any breach by
Executive of his obligations under Section 11 or 12 he will forfeit any and all bonus and rights to any payments to which he might otherwise then be entitled by virtue hereof and such payments may be suspended so long as any good faith dispute with
respect thereto is continuing; provided, however, that payments, benefits and other rights and privileges of the Executive under
this Agreement following termination of the Executive’s employment during a the 24 months following a Change in Control shall not be forfeited, suspended, offset, diminished or otherwise altered in any way on account of any breach or
prospective breach of Section 11, Section 12 or any other provision of this Agreement alleged by the Company. 

          (c) Notwithstanding any other provision of this Agreement, the Executive may elect to resolve any dispute involving a breach or alleged breach
of this Agreement following termination of the Executive’s employment during the 24 months following a Change in Control in any Federal or State court sitting in the City and State of New York or court sitting in Bermuda or the United Kingdom.
The Company hereby submits to the non-exclusive jurisdiction of all those courts for the purposes of any such actions or proceedings instituted by the Executive, and the Company agrees that process in any or all of such actions or proceedings may be
served by registered mail or delivery, addressed to the Company as set forth in Section 22, or in any other manner authorized by law. The

15

Company shall pay all costs associated with any court proceeding under this Section 18(c) without regard to the outcome of such proceeding, including all legal fees and expenses of the Executive, who shall be reimbursed for all
such costs promptly within 30 days following written demand therefore by the Executive (which written demand shall be made no later than six (6) months following the end of the calendar year in which such costs were incurred). 

          (d) Each Party shall bear its own costs incurred in connection with any proceeding under Sections 18(a) or 18(b) hereof, including all legal
fees and expenses; provided, however, that the Company shall bear all such costs of the Executive (to the extent such costs are
reasonable) if the Executive substantially prevails in the proceeding. Following the final determination of the dispute in which the Executive has substantially prevailed, the Company shall reimburse all such reasonable costs within 30 days
following written demand therefore (supported by documentation of such costs) by the Executive, and the Executive shall make such written demand within 60 days following the final determination of the dispute: provided, however, that such payment
shall be made no later than on or prior to the end of the calendar year following the calendar year in which the cost is incurred. Notwithstanding the foregoing, in the event a final determination of the dispute has not been made by December 1 of
the year following the calendar year in which the cost is incurred, the Company shall, within 30 days after such December 1, reimburse such reasonable costs (supported by documentation of such costs) incurred in the prior taxable year; provided,
however, that the Executive shall return such amounts to the Company within ten (10) business days following the final determination if the Executive did not substantially prevail in the dispute. 

          19.      TERMINATION OF HOUSING BENEFIT.

          On and after the Effective Date, the Executive shall no longer be entitled to be paid any monthly housing allowance by the Company. 

          20.      AMENDMENT OR WAIVER.

          No provision in this Agreement may be amended unless such amendment is agreed to in writing, signed by the Executive and by a duly authorized officer of the Company. No waiver by any Party of any
breach by the other Party of any condition or provision of this Agreement to be performed by such other Party shall be deemed a waiver of a similar or dissimilar condition or provision at the same or any prior or subsequent time. Except as set forth
in Exhibit D, any waiver must be in writing and signed by the Executive or a duly authorized officer of the Company, as the case may be.

          21.      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 sent by

16

courier, or 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: 

Syncora Holdings Ltd.

A.S. Cooper Building 

26 Reid Street 

Hamilton Bermuda 

Att’n: Chief Executive Officer 

If to the Executive: 

To the last address delivered to

the Company by the Executive in

the manner set forth herein. 

          22.      SEVERABILITY. 

          In the event that any provision or portion of this Agreement shall be determined to be invalid or unenforceable for any reason, in whole or in part, the remaining provisions of this Agreement shall be
unaffected thereby and shall remain in full force and effect to the fullest extent permitted by law. 

          23.      SURVIVORSHIP.

          The respective rights and obligations of the Parties shall survive any termination of this Agreement to the extent necessary to the intended preservation of such rights and obligations. 

          24.      REFERENCE.

          In the event of the Executive’s death or a judicial determination of his incompetence, reference in this Agreement to the Executive shall be deemed, where appropriate, to refer to his estate or
other legal representative. 

          25.      GOVERNING LAW.

          This Agreement shall be governed by and construed and interpreted in accordance with the laws of the State of New York without reference to the principles of conflict of laws. 

17

          26.      SECTION 409A.

          (a) The intent of the Parties is that payments and benefits under this Agreement comply with Internal Revenue Code Section 409A and the
regulations and guidance promulgated thereunder (collectively “Code Section 409A”) and, accordingly, to the maximum extent permitted, this Agreement shall be interpreted to be in
compliance therewith. If the Executive notifies the Company (with specificity as to the reason therefor) that the Executive believes that any provision of this Agreement (or of any award of compensation, including equity compensation or benefits)
would cause the Executive to incur any additional tax or interest under Code Section 409A and the Company concurs with such belief or the Company (without any obligation whatsoever to do so) independently makes such determination, the Company shall,
after consulting with the Executive, reform such provision to attempt to comply with Code Section 409A through good faith modifications to the minimum extent reasonably appropriate to conform with Code Section 409A. To the extent that any provision
hereof is modified in order to comply with Code Section 409A, such modification shall be made in good faith and shall, to the maximum extent reasonably possible, maintain the original intent and economic benefit/burden to the Executive and the
Company of the applicable provision without violating the provisions of Code Section 409A. 

          (b) With respect to any payment hereunder that constitutes deferred compensation subject to Code Section 409A, a termination of employment with
the Company or its Affiliates shall not be deemed to have occurred for purposes of any provision of this Agreement providing for the payment of any amounts or benefits upon or following a termination of employment unless such termination constitutes
a “separation from service” within the meaning of Code Section 409A and, for purposes of any such provision of this Agreement, references to a “termination,” “termination of employment” or like terms shall mean
“separation from service”, provided that the percentage used under Treas. Reg. Sec. 1.409A -1(h)(ii) for purposes of determining whether a separation from service has or has not occurred shall be 49% rather than 20%.

          (c) With regard to any provision herein that provides for reimbursement of costs and expenses or in-kind benefits, except as permitted by Code
Section 409A, (i) the right to reimbursement or in-kind benefits shall not be subject to liquidation or exchange for another benefit, (ii) the amount of expenses eligible for reimbursement, or in-kind benefits, provided during any taxable year shall not affect the expenses eligible for reimbursement, or in-kind benefits to be provided, in any other taxable year, provided
that the foregoing clause (ii) shall not be violated without regard to expenses reimbursed under any arrangement covered by Code Section 105(b) solely because such expenses are subject to a limit related to the period the arrangement is in effect
and (iii) such payments shall be made on or before the last day of the Executive’s taxable year following the taxable year in which the expense was incurred. 

18

          (d) Whenever a payment under this Agreement specifies a payment period with reference to a number of days (e.g., “payment shall be made
within thirty (30) days after termination of employment”), the actual date of payment within the specified period shall be within the sole discretion of the Company. 

          (e) The Company shall indemnify the Executive, as provided in Section 3(c), if the Executive incurs additional tax under Code Section 409A as a result of a violation of Code Section 409A (each an
“Indemnified Code Section 409A Violation”). The procedures set forth in Section 9(c) and 9(d) with respect to the Gross-Up Payment shall also apply to the payment of the Code
Section 409A Tax and the Company’s indemnity obligations with respect thereto (including, without limitation, the Company’s right to contest the Code Section 409A Tax); provided,
that, in addition to such procedures, the Executive shall reasonably cooperate with measures identified by the Company that are intended to mitigate the Code Section 409A Tax to the extent that such measures do not materially reduce or delay the
payments and benefits to the Executive hereunder. 

          (f) Any payment made by the Company in respect of any taxes imposed with regard to the Company’s obligation to provide benefits in lieu of continued medical plan coverage shall be paid to the
Executive, his dependents or the applicable taxing authority on their behalf, no later than the due date for the payment of such taxes. 

          27.      HEADINGS.

          The heading of the sections contained in this Agreement are for convenience only and shall not be deemed to control or affect the meaning or construction of any provision of this Agreement. 

          28.      COUNTERPARTS.

          This Agreement may be executed in one or more counterparts.

 

19

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

	 	
    SYNCORA HOLDINGS LTD.	
	 	 	 
	 	By:   	/s/
	    Susan
	    B. Comparato 	 
	 	 	Name: Susan
	    B. Comparato
	 	 	Title: Acting
	  CEO and President
	 	 	 
	 	 	 
	 	 	/s/
    Claude L. LeBlanc	 
	 	 	Name: Claude L. LeBlanc 
	 	 	 
	 	 	 
	 	
    GUARANTORS:	
	 	 
	 	 
	 	
    SYNCORA HOLDINGS LTD.	
	 	 	 
	 	 	 
	 	By:	/s/
    Susan B. Comparato	 
	 	 	Name:	Susan
	    B. Comparato
	 	 	Title: Acting CEO and President
	 	 	 
	 	 	 
	 	
    SYNCORA HOLDINGS US INC.	
	 	 	 
	 	 	 
	 	By:	/s/
    Susan B. Comparato	 
	 	 	Name:	Susan
    B. Comparato
	 	 	Title: Secretary	
	 	 	 
	 	 	 
	 	
    SYNCORA GUARANTEE RE LTD.	
	 	 	 
	 	 	 
	 	By:	/s/
    Susan B. Comparato	 
	 	 	Name:	Susan
    B. Comparato
	 	 	Title: Secretary	

20

EXHIBIT A

CHANGE IN CONTROL

          For purposes of this Agreement, “Change in Control” shall mean:

          (i) the acquisition by any individual, entity or group (within the meaning of Section 13(d)(3) or 14(d)(2) of the Exchange Act (a “Person”), of beneficial ownership (within the meaning of Rule 13d-3 promulgated under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)) of 30% or
more of either (1) the then outstanding shares of common stock of the Company (the “Outstanding Company Common Stock”) or (2) the combined voting power of the then outstanding voting securities of the Company entitled to vote generally in the
election of directors (the “Outstanding Company Voting Securities”); provided, however, that the following acquisitions shall not constitute a Change in Control: (i) any acquisition by the Company or any of its Subsidiaries; (ii) any acquisition by any employee benefit plan (or related trust) sponsored or
maintained by the Company or any of its Subsidiaries; (iii) any acquisition by any corporation with respect to which, following such acquisition, more than 60% of, respectively, the then
outstanding shares of common stock of such corporation and the combined voting power of the then outstanding voting securities of such corporation entitled to vote generally in the election of directors is then beneficially owned, directly or
indirectly, by all or substantially all of the individuals and entities who were the beneficial owners, respectively, of the outstanding Company Common Stock and Outstanding Company Voting Securities immediately prior to such acquisition in
substantially the same proportions as their ownership, immediately prior to such acquisition, of the Outstanding Company Common Stock and Outstanding Company Voting Securities, as the case may be (unless a Person’s ownership of the acquiring
corporation results in that Person directly or indirectly owning 30% or more of the Outstanding Company Common Stock or Outstanding Company Voting Securities); or (iv) any acquisition by XL
Capital Ltd or its wholly-owned subsidiaries unless, at any time after the Effective Date and prior to such acquisition, XL Capital Ltd and its subsidiaries own less than 30% of the Outstanding Company Voting Securities; 

          (ii) during any period of two consecutive years, individuals who, as of the beginning of such period, constitute the Board (the “Incumbent Board”) cease for any reason to constitute at least a majority of the Board; provided, however, that any individual
becoming a director subsequent to the beginning of such period whose election, or nomination for election by the Company’s shareholders, was approved by a vote of at least a majority of the directors then comprising the Incumbent Board shall be
considered as though such individual were a member of the Incumbent Board, but excluding, for this purpose, any such individual whose initial assumption of office occurs as a result of either an actual or threatened election contest (as such terms
are used in Rule 14a-11 of Regulation 14A promulgated under the Exchange Act); 

A-1

          (iii) consummation of a reorganization, scheme of arrangement, merger, consolidation or similar transaction (collectively, a “Transaction”), in each case, with respect to which all or substantially all of the individuals and entities who were the beneficial owners, respectively, of the Outstanding Company Common Stock and outstanding Company Voting Securities
immediately prior to such Transaction, do not, following such Transaction, beneficially own, directly or indirectly, more than 60% of, respectively, the then outstanding shares of common stock and the combined voting power of the then outstanding
voting securities entitled to vote generally in the election of directors, as the case may be, of the corporation resulting from such Transaction in substantially the same proportions as their ownership, immediately prior to such Transaction, of the
Outstanding Company Common Stock and Outstanding Company Voting Securities, as the case may be; 

          (iv) consummation of a sale or other disposition of all or substantially all of the assets of the Company, other than to a corporation with respect to which following such sale or other disposition,
more than 60% of, respectively, the then outstanding shares of common stock of such corporation and the combined voting power of the then outstanding voting securities of such corporation entitled to vote generally in the election of directors is
then beneficially owned, directly or indirectly, by all or substantially all of the individuals and entities who were the beneficial owners, respectively, of the outstanding Company Common Stock and Outstanding Company Voting Securities immediately
prior to such sale or other disposition in substantially the same proportions as their ownership, immediately prior to such sale or other disposition, of the Outstanding Company Common Stock and Outstanding Company Voting Securities, as the case may
be; or 

          (v) approval by the shareholders of the Company of a complete liquidation or dissolution (or similar transaction) of the Company. 

A-2

EXHIBIT B

GOOD REASON

          For purposes of this Agreement, “Good Reason” shall mean any of the following, unless done with the prior express written consent
of the Executive: 

          A material diminution in the Executive’s base compensation;

          A material diminution in the Executive’s authority, duties, or responsibilities; 

          A material diminution in the authority, duties, or responsibilities of the supervisor to whom the Executive is required to report, including a requirement that a Executive report to a corporate
officer or employee instead of reporting directly to the board of directors of a corporation (or similar governing body with respect to an entity other than a corporation);

          A material diminution in the budget over which the Executive retains authority; 

          A material change in the geographic location at which the Executive must perform the services; or 

          Any other action or inaction that constitutes a material breach by the service recipient of the agreement under which the Executive provides services.

          Notwithstanding any provision in this Agreement to the contrary, the Executive must give written notice of his intention to terminate his employment for Good Reason within sixty (60) days after the
act or omission which constitutes Good Reason, and the Company shall have thirty (30) days from such notice to remedy the condition, in which case Good Reason shall no longer exist with regard to such condition. Any failure to give such written
notice within such period will result in a waiver by the Executive of his right to terminate for Good Reason as a result of such act or omission. Any termination hereunder shall occur within 120 days after the Good Reason event occurs. 

B-1

EXHIBIT C

Form of General Release and Covenant Not to Sue

	
1.       	
General Release of Claims. In consideration for the payments and benefits paid to you under Section 5(c), (d) and (e) of the Amended and Restated Employment Agreement between
you and Syncora Holdings Ltd. (the “Company”), dated August 28, 2008 (the “Agreement”) , you hereby release and forever discharge the Company, and any and all of their respective affiliates, predecessors, successors, assigns, and
their respective officers, directors, administrators and employees (the “Released Parties”) of and from all actions, claims, liabilities, demands and causes of action, known
or unknown, fixed or contingent, in law or equity, included but not limited to those arising under the Civil Rights Act of 1964, the Reconstruction Era Civil Rights Act, the Age Discrimination in Employment Act of 1967 (“ADEA”), the Employee Retirement Income Security Act of 1974, The Americans with Disabilities Act, The Family and Medical Leave Act of 1993, The New York State Human Rights Law Section 196 ET SEQ.,
the New York City Administrative Code, as amended, and any and all other federal, state, and local laws, rules and regulations prohibiting, without limitation, discrimination in employment, tortuous or wrongful discharge, breach of an express or
implied contract, breach of a covenant of good faith and fair dealing, negligent or intentional infliction of emotional distress, defamation, misrepresentation or fraud, which you ever had, now have or hereafter can, shall or may have for, upon or
by reason of any matter, cause or thing, up to and including the day on which you sign this Agreement (the “Claims”); provided, however, that you are not thereby waiving or
releasing, and this General Release of Claims does not waive or release, (a) any rights under the Agreement, (b) any right to any vested or accrued benefits (except as set forth in the Agreement) or to claim benefits under employee benefit plans
(including welfare plans), (c) any right of indemnification (including, without limitation, indemnification, legal defense and related rights under the Agreement or the Company’s certificate of incorporation, by-laws or other such organic
documents), or (d) any rights under directors and officers’ liability insurance policies.

	
	 
	
2.	
Effect of General Release; Limitations on General Release. You understand that by signing this General Release you are prevented from filing, commencing or maintaining any
action, complaint, or proceeding with regard to any of the claims released hereby. However, nothing in the General Release of Claims above precludes you from filing a charge with an administrative agency or from participating in an agency
investigation. You are, however, waiving your right to recover money in connection with any such charge or investigation. You are also waiving your right to recover money in connection with a charge filed by any

	
	 

C-1

	 	
other individual or by the Equal Employment Opportunity Commission or any other federal or state agency.

	
	 
	
3.       	
Covenant Not to Sue.
    In addition to waiving and releasing the claims and rights covered by the
    General Release of Claims, you promise not to sue the Company or any other
     Released Party in any forum for any reason, including but not limited to
    claims, laws or theories covered by the General Release of Claims. This covenant
    by you not to sue is different from the General Release of Claims, which
    will provide the  Company a defense in the event you violate the General
    Release. If
you violate this Covenant Not to Sue by suing a Released Party, you may be liable
to that party for monetary damages. More specifically, if you sue a Released
Party in violation of this Covenant Not to Sue, you will be required to either:
(1) pay that Released Party’s attorneys’ fees and other costs incurred
as a result of having to defend against your suit; or (2) alternatively, at the
Released Party’s option, return to the Company your Stay Bonus and your
Amendment Payment, except for one-hundred dollars ($100.00). However, nothing
in this Covenant Not to Sue or in any other part of this Agreement prevents you
from challenging the validity of this Agreement under the ADEA.
	
	 
	
4.	
Knowing and Voluntary Decision to Sign. You further agree that no statements, representations, promises, threats or suggestions have been made by the Company or its
representatives, officers, or employees to influence you to sign this General Release except such statements as are expressly set forth herein. You have signed this General Release upon reaching the considered conclusion that it is best for you, and
of your own free will, relying entirely upon your own judgment, and the judgment of such lawyers and other personal advisors who you have chosen to consult. You further acknowledge that you are under no disability or impairment, which affects your
decision to sign this General Release.
	
	 
	
5.	
Time to Consider the Agreement. You have actually read this General Release, and have had adequate time of at least 21 days to consider its terms and effect, and to ask any
questions that you may have of the legal or other personal advisors of your own choosing.
	
	 
	
6.	
Subsequent Facts. No fact, evidence, event or transaction currently unknown to you but which may hereafter become known to you shall affect in any way or manner the final and
unconditional nature of this General Release.
	
	 

[signature page follows]

C-2

	
READ, ACCEPTED & AGREED	
	 	
	 
	/s/
      Claude
    L. LeBlanc
	Claude
    L. LeBlanc
	 
	August
	    28, 2008
	
Dated	

 

 

C-3

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