Document:

10.1  NMI Holdings Inc 2012 Stock Incentive Plan Effective April 24, 2012

EXHIBIT 10.1

NMI HOLDINGS, INC. 
2012 STOCK INCENTIVE PLAN
(Effective as of April 24, 2012)
1.Purpose
The purpose of the Plan is to give the Company a competitive advantage in attracting, retaining and motivating officers, employees, directors and/or consultants and to provide a means whereby officers, employees, directors and/or consultants of the Company and its Affiliates can acquire and maintain Common Stock ownership, or be paid incentive compensation measured by reference to the value of Common Stock, thereby strengthening their commitment to the welfare of the Company and its Affiliates and promoting an identity of interest between stockholders and these persons.
So that the appropriate incentive can be provided, the Plan provides for granting Nonqualified Stock Options, Stock Appreciation Rights, Restricted Stock Awards, Restricted Stock Unit Awards, Stock Awards and Stock Bonus Awards, or any combination of the foregoing.
2.    Definitions
For purposes of this Plan, the following terms are defined as set forth below:
(a)    “162(m) Effective Date” means the first date on which Awards granted under the Plan do not qualify for an exemption from the deduction limitations of Section 162(m) of the Code on account of an exemption, or a transition or grandfather rule.
(b)    “Affiliate” means, with respect to any specified entity, any other entity that directly or indirectly is controlled by, controls, or is under common control with such specified entity.
(c)    “Applicable Exchange” means the Nasdaq or such other nationally recognized securities exchange as may at the applicable time be the principal market for the Common Stock.
(d)    “Award” means, individually or collectively, any Nonqualified Stock Option, Stock Appreciation Right, Restricted Stock Award, Restricted Stock Unit Award, Stock Award or Stock Bonus Award granted pursuant to the terms of this Plan.
(e)    “Award Agreement” means a written or electronic document or agreement setting forth the terms and conditions of a specific Award.
(f)    “Beneficial Ownership” shall have the meaning given in Rule 13d-3 promulgated under the Exchange Act.
(g)    “Board” means the Board of Directors of the Company.

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(h)    “Cause” means, unless otherwise provided in an Award Agreement, (i) “Cause” as defined in any employment, consulting or similar agreement with the Company or any of its Affiliates to which the applicable Participant is a party (an “Individual Agreement”), or (ii) if there is no such Individual Agreement or if it does not define Cause:  (A) the willful or gross neglect by a Participant of his or her employment duties (other than as a result of his or her incapacity due to physical or mental illness or injury) as determined by the Committee; (B) the plea of guilty or nolo contendere to, or conviction for, the commission of a felony offense by a Participant; (C) conduct by a Participant that is injurious to the Company or an Affiliate, or an act of fraud, embezzlement, misrepresentation or breach of a fiduciary duty against the Company or any of its Subsidiaries, as determined by the Committee; (D) a breach by a Participant of any nondisclosure, non-solicitation or noncompetition obligation owed to the Company or any of its Affiliates; or (E) the failure of a Participant to follow instructions of the Board or his or her direct superiors.  Notwithstanding anything in Section 4(d) of this Plan, following a Change in Control, any determination by the Committee as to whether “Cause” exists shall be subject to de novo review.
(i)    “Change in Control” shall, unless in the case of a particular Award where the applicable Award Agreement states otherwise or contains a different definition of “Change in Control,” for the purpose of this Plan, be the first to occur following the Effective Date of:
(i)    the acquisition by any individual, entity or Group (a “Person” of Beneficial Ownership of 35% or more (on a fully diluted basis) of either (A) the then outstanding shares of Common Stock of the Company, taking into account as outstanding for this purpose such Common Stock issuable upon the exercise of options or warrants, the conversion of convertible stock or debt, and the exercise or settlement of any similar right to acquire such common stock (the “Outstanding Company Common Stock”), or (B) 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 for purposes of this Agreement, the following acquisitions shall not constitute a Change in Control:  (I) any acquisition by the Company or any Affiliate, (II) any acquisition directly from the Company, (III) any acquisition by any employee benefit plan sponsored or maintained by the Company or any Affiliate or (IV) any acquisition by any Person that complies with clauses (A), (B) and (C) of subsection (iv) of this Section 2(i);
(ii)    individuals who, on the date hereof, constitute the Board (the “Incumbent Directors”) cease for any reason to constitute at least a majority of the Board, provided that any person becoming a director subsequent to the date hereof, whose election or nomination for election was approved by a vote of at least two-thirds of the Incumbent Directors then on the Board (either by a specific vote or by approval of the proxy statement of the Company in which such person is named as a nominee for director, without written objection to such nomination), shall be an Incumbent Director; provided, however, that no individual initially elected or nominated as a director of the Company as a result of an actual or threatened election 

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EXHIBIT 10.1

contest with respect to directors or as a result of any other actual or threatened solicitation of proxies or consents by or on behalf of any person other than the Board shall be deemed to be an Incumbent Director; and provided, further, that any directors elected at the Directors Election Meeting (as defined in the Company’s By-Laws) shall be considered “Incumbent Directors” for purposes of this Section 2(i)(ii);
(iii)    approval by the stockholders of the Company of a complete dissolution or liquidation of the Company; or
(iv)    the consummation of a merger, consolidation, statutory share exchange, a sale or other disposition of all or substantially all of the assets of the Company or similar form of corporate transaction involving the Company that requires the approval of the Company’s stockholders, whether for such transaction or the issuance of securities in the transaction (a “Business Combination”), in each case, unless immediately following such Business Combination:  (A) more than 50% of the total voting power of (x) the entity resulting from such Business Combination (the “Surviving Company”) or (y) if applicable, the ultimate parent corporation that directly or indirectly has beneficial ownership of sufficient voting securities eligible to elect a majority of the directors of the Surviving Company (the “Parent Company”) is represented by the Outstanding Company Voting Securities that were outstanding immediately prior to such Business Combination (or, if applicable, is represented by shares into which the Outstanding Company Voting Securities were converted pursuant to such Business Combination), and such voting power among the holders thereof is in substantially the same proportion as the voting power of the Outstanding Company Voting Securities among the holders thereof immediately prior to the Business Combination, (B) no Person (other than any employee benefit plan sponsored or maintained by the Surviving Company or the Parent Company), is or becomes the beneficial owner, directly or indirectly, of 35% or more of the total voting power of the outstanding voting securities eligible to elect directors of the Parent Company (or, if there is no Parent Company, the Surviving Company) and (C) at least two-thirds of the members of the board of directors of the Parent Company (or, if there is no Parent Company, the Surviving Company) following the consummation of the Business Combination were Board members at the time of the Board’s approval of the execution of the initial agreement providing for such Business Combination.
For the avoidance of doubt, in no event shall (w) the Private Offering, (x) the Company’s public offering of Common Stock pursuant to a registration statement declared effective under the Securities Act, (y) any change in the composition of the Board resulting from a Special Election Meeting referred to in Section 2.2(b) of the Company’s By-Laws or from a Director Election Meeting referred to in Section 2.2(c) of the Company’s By- Laws or (z) any transactions relating to the dissolution or liquidation of the Company resulting from the failure to receive GSE Approval, in the case of each of clause (i), (ii), (iii) or (iv), constitute or be deemed to constitute a Change in Control nor shall it be taken into account in determining whether a Change in Control occurred for purposes of this Plan or any Award Agreement.

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(j)    “Code” means the Internal Revenue Code of 1986, as amended from time to time, and any successor thereto, the Treasury Regulations thereunder and other relevant interpretive guidance issued by the Internal Revenue Service or the Treasury Department.  Reference in the Plan to any specific section of the Code shall be deemed to include any amendments or successor provisions to such section and any regulations and guidance under such section.
(k)    “Committee” means a committee of at least two people as the Board may appoint to administer the Plan or, if no such committee has been appointed by the Board, the Board.  On and after the time that the Company becomes subject to the Exchange Act, unless the Board is acting as the Committee or the Board specifically determines otherwise, each member of the Committee shall, at the time he takes any action with respect to an Award under the Plan, be an Eligible Director; provided that the mere fact that a Committee member shall fail to qualify as an Eligible Director shall not invalidate any Award granted by the Committee which Award is otherwise validly granted under the Plan.
(l)    “Common Stock” means the common stock, par value $0.01 per share, of the Company (other than the Company’s Class B Common Stock), and any stock into which such common stock may be converted or into which it may be exchanged.
(m)    “Company” means NMI Holdings, Inc., or its successor.
(n)    “Date of Grant” means the date on which the granting of an Award is authorized, or such other date as may be specified in such authorization or, if there is no such date, the date indicated on the applicable Award Agreement.
(o)    “Disability” means, unless otherwise provided in an Award Agreement, the Company or an Affiliate having cause to terminate a Participant’s employment or service on account of “disability,” as defined in any existing Individual Agreement, or, in the absence of such an Individual Agreement, a condition entitling the Participant to receive benefits under a long-term disability plan of the Company or an Affiliate or, in the absence of such a plan, the complete and permanent inability by reason of illness or accident to perform the duties of the occupation at which a Participant was employed or served when such disability commenced or, as determined by the Committee, based upon medical evidence acceptable to it.  Notwithstanding the above, with respect to each Award that constitutes a “nonqualified deferred compensation plan” within the meaning of Section 409A of the Code, the foregoing definition shall apply for purposes of vesting of such Award, provided that such Award shall not be settled until the earliest of:  (i) the Participant’s “disability” within the meaning of Section 409A of the Code, (ii) the Participant’s “separation from service” within the meaning of Section 409A of the Code and (iii) the date such Award would otherwise be settled pursuant to the terms of the Award Agreement.
(p)    “Disaffiliation” means a Subsidiary’s or Affiliate’s ceasing to be a Subsidiary or Affiliate for any reason (including, without limitation, as a result of a public offering, or a spin-off or sale by the Company, of the stock of the Subsidiary or Affiliate or a sale of a division of the Company and its Affiliates).

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(q)    “Effective Date” means April 24, 2012.
(r)    “Eligible Director” means a person who is (i) a “non-employee director” within the meaning of Rule 16b-3 under the Exchange Act, or a person meeting any similar requirement under any successor rule or regulation and (ii) an “outside director” within the meaning of Section 162(m) of the Code, and the Treasury Regulations promulgated thereunder; provided, however, that clause (ii) shall apply only on and after the 162(m) Effective Date and only with respect to grants of Awards with respect to which the Company’s tax deduction could be limited by Section 162(m) of the Code if such clause did not apply.
(s)    “Eligible Person” means any director, officer, employee or consultant of the Company or any of its Subsidiaries or Affiliates, or any prospective employee and consultant who has accepted an offer of employment or consultancy from the Company or its Subsidiaries or Affiliates, who are or will be responsible for, or contribute to, the management, growth or profitability of the business of the Company or its Subsidiaries or Affiliates.
(t)    “Exchange Act” means the Securities Exchange Act of 1934, as amended.
(u)    “Fair Market Value” means (i) on the Effective Date, the price per share of Common Stock paid by investors in the Company and (ii) as of any subsequent date, the closing price of the Common Stock on any national securities exchange or any national market system (including, but not limited to, The NASDAQ National Market) on that date, or if no prices are reported on that date, on the last preceding date on which such prices of the Common Stock are so reported.  If the Common Stock is not then listed on any national securities exchange but is traded over the counter at the time determination of its Fair Market Value is required to be made, its Fair Market Value shall be deemed to be equal to the average between the reported high and low sales prices of Common Stock on the most recent date on which the Common Stock was publicly traded.  If the Common Stock is not publicly traded at the time a determination of its Fair Market Value is made, the Committee shall determine its Fair Market Value in such manner as it deems appropriate (such determination to be made in a manner that satisfies Section 409A of the Code (to the extent applicable) and in good faith as required by Section 422(c)(1) of the Code), which may be based on the advice of an independent investment banker or appraiser recognized to be an expert in making such valuations, on recent trades on a non-public exchange or any other material information available to the Board.
(v)    “Group” shall have the meaning given in Sections 13(d)(3) and 14(d)(2) of the Exchange Act.
(w)    “GSE Approval” means the conditional approval by either Fannie Mae or Freddie Mac necessary to permit the Company to write private mortgage insurance on terms and in a form acceptable to the Company.

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EXHIBIT 10.1

(x)    “GSE Approval Deadline” means the date that is nine months immediately following the consummation of the offering, or such later date as may be approved by a majority of the holders of the Common Stock purchased in the Private Offering.
(y)    “Nonqualified Stock Option” means an Option granted by the Committee to a Participant under the Plan.
(z)    “Option” means an Award granted under Section 7.
(aa)    “Option Period” means the period described in Section 7(c).
(bb)    “Option Price” means the exercise price for an Option as described in Section 7(a).
(cc)    “Participant” means an Eligible Person who has been selected by the Committee to participate in the Plan and to receive an Award pursuant to Section 6.
(dd)    “Performance-Based Restricted Awards” means Awards of Restricted Stock or Restricted Stock Units awarded to a Participant pursuant to Section 9, the grant of which is contingent upon the attainment of specified Performance Goals, or the vesting of which is subject to a risk of forfeiture if the specified Performance Goals are not met within the Performance Period.
(ee)    “Performance Goals” means the performance objectives of the Company or an Affiliate during a Performance Period or Restricted Period established for the purpose of determining whether, and to what extent, Awards will be earned for an Award Period or a Restricted Period.  To the extent an Award is intended to qualify as “performance-based compensation” under Section 162(m) of the Code, (i) the Performance Goals shall be established with reference to one or more of the following, either on a Company-wide basis or, as relevant, in respect of one or more Affiliates, Subsidiaries, divisions, departments or operations of the Company:  earnings (gross, net, pre-tax, post-tax or per share), net profit after tax, EBITDA, gross profit, cash generation, unit volume, market share, sales, asset quality, earnings per share, operating income, revenues, return on assets, return on operating assets, book value per share, return on equity, profits, total shareholder return (measured in terms of stock price appreciation or dividend growth), cost saving levels, premiums, losses, expenses, marketing spending efficiency, core non-interest income, change in working capital, return on capital, strategic development or stock price, with respect to the Company or any Subsidiary, Affiliate, division or department of the Company and (ii) such Performance Goals shall be set by the Committee within the time period prescribed by Section 162(m) of the Code and related regulations.  Such Performance Goals also may be based upon the attaining of specified levels of Company, Subsidiary, Affiliate or divisional performance under one or more of the measures described above relative to the performance of other entities, divisions or subsidiaries.

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(ff)    “Performance Period” means that period of time determined by the Committee over which performance is measured for the purpose of determining a Participant’s right to, and the payment value of, any Performance-Based Restricted Award.
(gg)    “Person” shall mean an individual or a corporation, association, partnership, limited liability company, joint venture, organization, business, trust, or any other entity or organization, including a government or any subdivision or agency thereof.
(hh)    “Plan” means this NMI Holdings, Inc. 2012 Stock Incentive Plan.
(ii)    “Private Offering” means the private offering of the Common Stock pursuant to the Company’s Offering Memorandum dated March  , 2012.
(jj)    “Restricted Period” means, with respect to any share of Restricted Stock or any Restricted Stock Unit, the period of time determined by the Committee during which such Award is subject to the restrictions set forth in Section 9.
(kk)    “Restricted Stock” means shares of Stock issued or transferred to a Participant subject to forfeiture and the other restrictions set forth in Section 9.
(ll)    “Restricted Stock Award” means an Award of Restricted Stock granted under Section 9.
(mm)    “Restricted Stock Unit” means a hypothetical investment equivalent to one share of Stock granted in connection with an Award made under Section 9.
(nn)    “Securities Act” means the Securities Act of 1933, as amended.
(oo)    “Stock” means the Common Stock or such other authorized shares of stock of the Company as the Committee may from time to time authorize for use under the Plan.
(pp)    “Stock Appreciation Right” or “SAR” means an Award granted under Section 8 of the Plan.
(qq)    “Stock Award” means an Award of the right to purchase Stock under Section 11 of the Plan.
(rr)    “Stock Bonus” means an Award granted under Section 10 of the Plan.
(ss)    “Stock Option Agreement” means the agreement between the Company and a Participant who has been granted an Option pursuant to Section 7 that defines the rights and obligations of the parties as required in Section 7(d).
(tt)    “Strike Price” means, in respect of an SAR, (i) in the case of a Tandem SAR, the Option Price of the related Option, or (ii) in the case of a Free- Standing SAR, the Fair Market Value on the Date of Grant.

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(uu)    “Subsidiary” means any corporation, partnership, joint venture, limited liability company or other entity during any period in which at least a 50% voting or profits interest is owned, directly or indirectly, by the Company or any successor to the Company.
(vv)    “Termination of Service” means the termination of the applicable Participant’s employment with, or performance of services for, the Company and any of its Subsidiaries or Affiliates.  Unless otherwise determined by the Committee, if a Participant’s employment with, or membership on a board of directors of the Company and its Affiliates terminates but such Participant continues to provide services to the Company and its Affiliates in a nonemployee director capacity or as an employee, as applicable, such change in status shall not be deemed a Termination of Service.  A Participant employed by, or performing services for, a Subsidiary or an Affiliate or a division of the Company and its Affiliates shall not be deemed to incur a Termination of Service if, as a result of a Disaffiliation, such Subsidiary, Affiliate, or division ceases to be a Subsidiary, Affiliate or division, as the case may be, and the Participant immediately thereafter becomes an employee of (or service provider for), or member of the Board of, the Company or another Subsidiary or Affiliate.  Approved temporary absences from employment because of illness, vacation or leave of absence and transfers among the Company and its Subsidiaries and Affiliates shall not be considered Terminations of Employment.  Notwithstanding the foregoing, with respect to any Award that constitutes a “nonqualified deferred compensation plan” within the meaning of Section 409A of the Code, “Termination of Service” shall mean a “separation from service” as defined under Section 409A of the Code.
(ww)    “Vested Unit” shall have the meaning ascribed thereto in Section 9(d).
3.    Effective Date, Duration and Stockholder Approval
The Plan is effective as of the Effective Date.  The validity and exercisability of any and all Awards granted pursuant to the Plan on and after the 162(m) Effective Date is contingent upon approval of the Plan by the stockholders of the Company in a manner intended to comply with the stockholder approval requirements of Section 162(m) of the Code.
The expiration date of the Plan, on and after which no Awards may be granted hereunder, shall be the tenth anniversary of the Effective Date (the “Expiration Date”); provided, however, that the administration of the Plan shall continue in effect until all matters relating to Awards previously granted have been settled.  Awards outstanding as of the Expiration Date shall not be affected or impaired by termination of the Plan.
4.    Administration
(a)    The Plan shall be administered by the Committee or such other committee of the Board as the Board may from time to time designate.  The Committee may only act by a majority of its members then in office, except that the Committee may, except to the extent prohibited by applicable law or the listing standards of the Applicable Exchange, 

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allocate all or any portion of its responsibilities and powers to any one or more of its members and may delegate all or any part of its responsibilities and powers to any person or persons selected by it.
(b)    Subject to the terms and conditions of the Plan and applicable law, including, without limitation, Section 409A of the Code, the Committee shall have, in addition to other express powers and authorizations conferred on the Committee by the Plan, the power to:  (i) designate Participants; (ii) determine the type or types of Awards to be granted to a Participant; (iii) determine the number of shares of Stock to be covered by, or with respect to which payments, rights, or other matters are to be calculated in connection with, Awards; (iv) determine the terms and conditions of any Award; (v) determine whether, to what extent, and under what circumstances Awards may be settled or exercised in cash, shares of Stock, other securities, other Awards or other property, or canceled, forfeited or suspended and the method or methods by which Awards may be settled, exercised, canceled, forfeited or suspended; (vi) determine whether, to what extent, and under what circumstances the delivery of cash, Stock, other securities, other Awards, other property and other amounts payable with respect to an Award shall be deferred either automatically or at the election of the holder thereof or of the Committee; (vii) interpret, administer, reconcile any inconsistency, correct any defect and/or supply any omission in the Plan and any instrument or agreement relating to, or Award granted under, the Plan; (viii) establish, amend, suspend or waive such rules and regulations and appoint such agents as it shall deem appropriate for the proper administration of the Plan; (ix) establish any “blackout” period that the Committee in its sole discretion deems necessary or advisable; (x) determine Fair Market Value; and (xi) make any other determination and take any other action specified under the Plan or that the Committee deems necessary or desirable for the administration of the Plan.
(c)    Unless otherwise expressly provided in the Plan, all designations, determinations, interpretations, and other decisions under or with respect to the Plan or any Award or any documents evidencing Awards granted pursuant to the Plan shall be within the sole discretion of the Committee, may be made at any time and shall be final, conclusive and binding upon all parties, including, without limitation, the Company, any Affiliate, any Participant, any holder or beneficiary of any Award and any stockholder.
(d)    The terms and conditions of each Award, as determined by the Committee, shall be set forth in an Award Agreement, which shall be delivered to the Participant receiving such Award upon, or as promptly as is reasonably practicable following, the grant of such Award.  The effectiveness of an Award shall not be subject to the Award Agreement’s being signed by the Company and/or the Participant’s receiving the Award unless specifically so provided in the Award Agreement.  Award Agreements may be amended only in accordance with Section 16 hereof.  Notwithstanding any provision of the Plan or an Award Agreement to the contrary, in the event that any term of an Award Agreement conflicts with any provision of the Plan that specifically pertains to Section 409A of the Code, the provision of the Plan shall govern.
(e)    No member of the Committee shall be liable for any action or determination made in good faith with respect to the Plan or any Award hereunder.

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5.    Grant of Awards; Shares Subject to the Plan
The Committee may, from time to time, grant Awards of Options, Stock Appreciation Rights, Restricted Stock, Restricted Stock Units, Stock Awards and/or Stock Bonuses to one or more Eligible Persons; provided, however, that:
(a)    Subject to Section 13, the aggregate number of shares of Stock in respect of which Awards may be granted under the Plan is 5,500,000 shares.  The maximum number of shares of Stock that may be granted pursuant to Options is 3,850,000.  The maximum number of shares of Stock that may be granted pursuant to Restricted Stock and Restricted Stock Units is 1,650,000;
(b)    To the extent that any Award is forfeited, or any Option and the related Tandem SAR (if any) or Free-Standing SAR terminates, expires or lapses without being exercised, or any Award is settled for cash, the shares of Stock subject to such Award not delivered as a result thereof shall again be available for Awards under the Plan;
(c)    If the Option Price of any Option and/or the tax withholding obligations relating to any Award are satisfied by delivering shares of Stock to the Company (by either actual delivery or by attestation), only the number of shares of Stock issued net of the shares of Stock delivered or attested to shall be deemed delivered for purposes of determining the maximum numbers of shares of Stock available for delivery under the Plan.  To the extent any shares of Stock subject to an Award are not delivered because such shares are withheld to satisfy the Option Price (in the case of an Option) and/or the tax withholding obligations relating to such Award, such shares shall not be deemed to have been delivered for purposes of determining the maximum number of shares of Stock available for delivery under the Plan;
(d)    Stock delivered by the Company in settlement of Awards may be authorized and unissued Stock, Stock held in the treasury of the Company, Stock purchased on the open market or by private purchase or a combination of the foregoing;
(e)    On and after the 162(m) Effective Date, no person may be granted Options or SARs under the Plan during any calendar year with respect to more than 3,850,000 shares of Stock; provided that such number shall be adjusted pursuant to Section 13, and shares otherwise counted against such number, only in a manner that will not cause the Awards granted under the Plan to fail to qualify as “performance-based compensation” for purposes of Section 162(m) of the Code; and
(f)    On and after the 162(m) Effective Date, with respect to awards of Performance-Based Restricted Awards, and other Restricted Stock or Restricted Stock Unit Awards intended to qualify as “performance-based compensation” under Section 162(m) of the Code, no person may be granted Performance-Based Restricted Awards, Restricted Stock or Restricted Stock Units under the Plan during any calendar year with respect to more than 1,650,000 shares of Stock; provided that such number shall be adjusted pursuant to Section 13, and shares otherwise counted against such number, only in a manner that will not cause such Performance-Based Restricted Awards, Restricted Stock or Restricted Stock Units 

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granted under the Plan to fail to qualify as “performance- based compensation” under Section 162(m) of the Code.
6.    Eligibility
Participation shall be limited to Eligible Persons who have entered into an Award Agreement or who have received written notification from the Committee, or from a person designated by the Committee, that they have been selected to participate in the Plan.
7.    Options
The Committee is authorized to grant one or more Nonqualified Stock Options to any Eligible Person.  Each Option so granted shall be subject to the following conditions, or to such other conditions as may be reflected in the applicable Stock Option Agreement.
(a)    Option Price.  The Option Price per share of Stock for each Option shall be set by the Committee at the time of grant but shall not be less than the Fair Market Value of a share of Stock at the Date of Grant.
(b)    Manner of Exercise and Form of Payment.  No shares of Stock shall be delivered pursuant to any exercise of an Option until payment in full of the Option Price therefor is received by the Company.  Options that have become exercisable shall be exercised by delivery of written notice of exercise to the Committee accompanied by payment of the Option Price.  The Option Price shall be payable in cash and/or shares of Stock valued at the Fair Market Value at the time the Option is exercised (including by means of attestation of ownership of a sufficient number of shares of Stock in lieu of actual delivery of such shares to the Company); provided that such shares of Stock are not subject to any pledge or other security interest, and have such other characteristics as may be determined in the sole discretion of the Committee.  In addition, the Option Price may be payable by such other method as the Committee may allow, including by way of a “net exercise” pursuant to which a Participant, without tendering the Option Price, is paid shares of Stock representing the excess of (i) the Fair Market Value on the date of exercise of the shares of Stock as to which the Option is being exercised over (ii) the aggregate Option Price.
(c)    Vesting, Option Period and Expiration.  Options shall vest and become exercisable in such manner and on such date or dates determined by the Committee and shall expire after such period, not to exceed ten years, as may be determined by the Committee (the “Option Period”); provided, however, that notwithstanding any vesting dates set by the Committee, the Committee may in its sole discretion accelerate the exercisability of any Option, which acceleration shall not affect the terms and conditions of any such Option other than with respect to exercisability.  If an Option is exercisable in installments, such installments or portions thereof which become exercisable shall remain exercisable until the Option expires.

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(d)    Stock Option Agreement — Other Terms and Conditions.  Each Option granted under the Plan shall be evidenced by a Stock Option Agreement.  Except as specifically provided otherwise in such Stock Option Agreement, each Option granted under the Plan shall be subject to the following terms and conditions:
(v)    Each Option or portion thereof that is exercisable shall be exercisable for the full amount or for any part thereof.
(vi)    The Option Price for each Option exercised shall be paid for in full at the time of the exercise.  Each Option shall cease to be exercisable, as to any share of Stock, when the Participant purchases the share or exercises a related SAR or when the Option expires.
(vii)    Subject to Section 12(l), Options shall not be transferable by the Participant except by will or the laws of descent and distribution and shall be exercisable during the Participant’s lifetime only by him.
(viii)    Each Option shall vest and become exercisable by the Participant in accordance with the vesting schedule established by the Committee and set forth in the Stock Option Agreement.
(ix)    At the time of any exercise of an Option, the Committee may, in its sole discretion, require a Participant to deliver to the Committee a written representation that the shares of Stock to be acquired upon such exercise are to be acquired for investment and not for resale or with a view to the distribution thereof and any other representation deemed necessary by the Committee to ensure compliance with all applicable federal and state securities laws.  Upon such a request by the Committee, delivery of such representation(s) prior to the delivery of any shares issued upon exercise of an Option shall be a condition precedent to the right of the Participant or such other person to purchase any shares.  In the event certificates for Stock are delivered under the Plan with respect to which such investment representation has been obtained, the Committee may cause a legend or legends to be placed on such certificates to make appropriate reference to such representation and to restrict transfer in the absence of compliance with applicable federal or state securities laws.
8.    Stock Appreciation Rights
Any Option granted under the Plan may include SARs, either at the Date of Grant or by subsequent amendment (SARS that are granted in conjunction with an Option are referred to in this Plan as “Tandem SARs”).  The Committee also may award SARs to Eligible Persons independent of any Option (SARS that are granted independent of any Option are referred to in this Plan as “Free-Standing SARs”).  An SAR shall be subject to such terms and conditions not inconsistent with the Plan as the Committee shall impose as set forth in an Award Agreement, including, but not limited to, the following:

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EXHIBIT 10.1

(a)    Vesting, Transferability and Expiration.  Tandem SARs shall become exercisable, be transferable and shall expire according to the same vesting schedule, transferability rules and expiration provisions as the corresponding Option.  Free-Standing SARs shall become exercisable, be transferable and shall expire in accordance with a vesting schedule, transferability rules and expiration provisions as established by the Committee and reflected in an Award Agreement.
(b)    Payment.  Upon the exercise of an SAR, the Company shall pay to the Participant an amount equal to the number of shares subject to the SAR multiplied by the excess, if any, of the Fair Market Value of one share of Stock on the exercise date over the Strike Price.  The Company shall pay such excess in cash, in shares of Stock valued at Fair Market Value, or any combination thereof, as determined by the Committee.  Fractional shares shall be settled in cash.
(c)    Method of Exercise.  A Participant may exercise an SAR at such time or times as may be determined by the Committee at the time of grant by filing an irrevocable written notice with the Committee or its designee, specifying the number of SARs to be exercised and the date on which such SARs were awarded.
(d)    Expiration.  Except as otherwise provided in the case of Tandem SARs, a SAR shall expire on a date designated by the Committee that is not later than ten years after the Date of Grant of the SAR.
9.    Restricted Stock Awards and Restricted Stock Units
(a)    Award of Restricted Stock and Restricted Stock Units.
(i)    The Committee shall have the authority (A) to grant Restricted Stock and Restricted Stock Units to Eligible Persons, (B) to issue or transfer Restricted Stock to Participants and (C) to establish terms, conditions and restrictions applicable to such Restricted Stock and Restricted Stock Units, including (i) the Restricted Period, (ii) the time or times at which Restricted Stock or Restricted Stock Units shall be granted or become vested, including upon the attainment of performance conditions (whether or not such conditions are Performance Goals) or upon both the attainment of performance conditions (whether or not such conditions are Performance Goals) and the continued service of the applicable Participant and (iii) the number of shares or units to be covered by each grant.
(ii)    Subject to the restrictions set forth in Section 9(b), the Participant generally shall have the rights and privileges of a stockholder as to such Restricted Stock, including the right to vote such Restricted Stock.  The Award Agreement for Restricted Stock shall specify whether, to what extent and on what terms and conditions the applicable Participant shall be entitled to receive current or deferred payments of cash and/or Stock dividends on the class or series 
 
of Stock that is subject to the Restricted Stock, including whether any such dividends will be held subject to the vesting of the underlying Restricted Stock or held subject 

13

EXHIBIT 10.1

to meeting Performance Goals, subject to Section 12(e) below in the case of dividends settled in Stock.
(iii)    Awards of Restricted Stock shall be evidenced in such manner as the Committee may deem appropriate, including book-entry registration or issuance of one or more stock certificates.  Any certificate issued in respect of shares of Restricted Stock shall be registered in the name of the applicable Participant and shall bear an appropriate legend referring to the terms, conditions, and restrictions applicable to such Award, substantially in the following form:
Transfer of this certificate and the shares represented hereby is restricted pursuant to the terms of the NMI Holdings, Inc. 2012 Stock Incentive Plan and a Restricted Stock Award Agreement, dated as of ________________, between NMI Holdings, Inc. and _______________.  A copy of such Restricted Stock Award Agreement is on file at the offices of NMI Holdings, Inc.
The Committee may require that the certificates evidencing such shares be held in custody by the Company until the restrictions thereon shall have lapsed and that, as a condition of any Award of Restricted Stock, the applicable Participant shall have delivered a stock power, endorsed in blank, relating to the Common Stock covered by such Award.
(iv)    No shares of Stock shall be issued at the time a Restricted Stock Unit is granted and the Company will not be required to set aside a fund for the payment of any such Award.  The Award Agreement for Restricted Stock Units shall specify whether, to what extent and on what terms and conditions the applicable Participant shall be entitled to receive current or deferred payments of cash, Stock or other property corresponding to the dividends payable on the Stock, including whether any such dividends will be held subject to the vesting of the underlying Restricted Stock Units or held subject to meeting Performance Goals, subject to Section 12(e) below in the case of dividends settled in Stock.
(b)    Restrictions.
(x)    Restricted Stock awarded to a Participant shall be subject to the following restrictions until the expiration of the Restricted Period, and to such other terms and conditions as may be set forth in the applicable Award Agreement:  (A) the shares shall be subject to the restrictions on transferability set forth in the Award Agreement and (B) the shares shall be subject to forfeiture to the extent provided in the applicable Award Agreement, and satisfaction of any applicable Performance Goals during such period, to the extent provided in the applicable Award Agreement and, to the extent such shares are forfeited, the stock certificates shall be returned to the Company and all rights of the Participant to such shares and as a stockholder shall terminate without further obligation on the part of the Company.
(xi)    Restricted Stock Units awarded to any Participant shall be subject to (A) forfeiture until the expiration of the Restricted Period, and satisfaction 

14

EXHIBIT 10.1

of any applicable Performance Goals during such period, to the extent provided in the applicable Award Agreement, and to the extent such Restricted Stock Units are forfeited, all rights of the Participant to such Restricted Stock Units shall terminate without further obligation on the part of the Company and (B) such other terms and conditions as may be set forth in the applicable Award Agreement.
(xii)    The Committee shall have the authority to remove any or all of the restrictions on the Restricted Stock and Restricted Stock Units whenever it may determine that, by reason of changes in applicable laws or other changes in circumstances arising after the date that the Restricted Stock or Restricted Stock Units are granted, such action is appropriate.
(c)    Restricted Period.  The Restricted Period of Restricted Stock and Restricted Stock Units shall commence on the Date of Grant and shall expire from time to time as to that part of the Restricted Stock and Restricted Stock Units indicated in a schedule established by the Committee in the applicable Award Agreement.
(d)    Delivery of Restricted Stock and Settlement of Restricted Stock Units.
(i)    Restricted Stock.  Upon the expiration of the Restricted Period with respect to any shares of Restricted Stock and/or the satisfaction of any applicable Performance Goals, the restrictions set forth in Section 9(b) and the applicable Award Agreement shall be of no further force or effect with respect to such shares, except as set forth in the applicable Award Agreement.
(ii)    Restricted Stock Units.  Upon the expiration of the Restricted Period with respect to any outstanding Restricted Stock Units the Company shall deliver to the Participant, or his or her beneficiary, without charge, one share of Stock for each such outstanding Restricted Stock Unit (“Vested Unit”); provided, however, that, if explicitly provided in the applicable Award Agreement, the Committee may, in its sole discretion, elect to (A) pay cash or part cash and part Stock in lieu of delivering only shares of Stock for Vested Units or (B) delay the delivery of Stock (or cash or part Stock and part cash, as the case may be) beyond the expiration of the Restricted Period.  If a cash payment is made in lieu of delivering shares of Stock, the amount of such payment shall be equal to the Fair Market Value of the Stock as of the date on which the Restricted Period lapsed with respect to such Vested Unit.
(e)    Applicability of Section 162(m).  With respect to Performance- Based Restricted Awards made on and after the 162(m) Effective Date and intended to qualify as “performance-based compensation” under Section 162(m) of the Code, this
Section 9 (including the substance of the Performance Goals, the timing of establishment of the Performance Goals, the adjustment of the Performance Goals and determination of the Award) shall be implemented by the Committee in a manner designed to preserve such Awards as “performance-based compensation.”

15

EXHIBIT 10.1

10.    Stock Bonus Awards
The Committee may issue unrestricted Stock, or other Awards denominated in Stock (valued at Fair Market Value as of the date of payment), under the Plan to Eligible Persons, alone or in tandem with other Awards, in such amounts and subject to such terms and conditions as the Committee shall from time to time in its sole discretion determine.  Stock Bonus Awards under the Plan shall be granted as, or in payment of, a bonus, or to provide incentives or recognize special achievements or contributions.  With respect to Stock Bonus Awards made on and after the 162(m) Effective Date and intended to qualify as “performance-based compensation” under Section 162(m) of the Code, the Committee shall establish and administer Performance Goals in the manner described in Section 9 as an additional condition to the vesting and payment of such Stock Bonus Awards.  The Stock Bonus Award for any Performance Period to any Participant may be reduced or eliminated by the Committee in its discretion.
11.    Stock Awards
(a)    General.  Stock Awards may be granted under the Plan at any time and from time to time on or prior to the Expiration Date.  Each Stock Award shall be evidenced by an Award Agreement that shall be executed by the Company and the Participant.  The Award Agreement shall specify the terms and conditions of the Stock Award, including, without limitation, the number of shares of Common Stock covered by the Stock Award, the purchase price for such shares of Common Stock and the deadline for the purchase of such shares of Common Stock.
(b)    Purchase Price; Payment.  The price (the “Purchase Price”) at which each share of Common Stock covered by the Stock Award may be purchased upon exercise of a Stock Award shall be determined by the Committee and set forth in the applicable Award Agreement.  The Company will not be obligated to issue certificates evidencing Stock purchased under this Section 11 unless and until it receives full payment of the aggregate Purchase Price therefor and all other conditions to the purchase, as determined by the Committee, have been satisfied.  The Purchase Price of any shares of Common Stock subject to a Stock Award must be paid in full at the time of the purchase.
12.    General
(a)    Additional Provisions of an Award.  Awards to a Participant under the Plan also may be subject to such other provisions (whether or not applicable to Awards granted to any other Participant) as the Committee determines appropriate including, without limitation, (i) provisions for the forfeiture of or restrictions on resale or other disposition of shares of Stock acquired under any Award, (ii) provisions giving 
the Company the right to repurchase shares of Stock acquired under any Award in the event the Participant elects to dispose of such shares, (iii) provisions allowing the Participant to elect to defer the receipt of payment in respect of Awards for a specified period or until a specified event, provided such provisions comply with Section 409A of the Code and (iv) provisions to comply with federal and state securities laws and federal and 

16

EXHIBIT 10.1

state tax withholding requirements.  Any such provisions shall be reflected in the applicable Award Agreement.
(b)    Privileges of Stock Ownership.  Except as otherwise specifically provided in the Plan, no person shall be entitled to the privileges of ownership in respect of shares of Stock that are subject to Awards hereunder until such shares have been issued to that person.
(c)    Conditions for Issuance.  The obligation of the Company to settle Awards in Stock or otherwise shall be subject to all applicable laws, rules and regulations and to such approvals by governmental agencies as may be required.  Notwithstanding any other provision of the Plan or agreements made pursuant thereto, the Company shall not be required to issue or deliver any certificate or certificates for Stock under the Plan prior to fulfillment of all of the following conditions:  (i) listing or approval for listing upon notice of issuance, of such Stock on the Applicable Exchange; (ii) any registration or other qualification of such Stock of the Company under any state or federal law or regulation, or the maintaining in effect of any such registration or other qualification that the Committee shall, in its absolute discretion upon the advice of counsel, deem necessary or advisable; and (iii) obtaining any other consent, approval or permit from any state or federal governmental agency that the Committee shall, in its absolute discretion after receiving the advice of counsel, determine to be necessary or advisable.  The Company shall be under no obligation to register for sale under the Securities Act any of the shares of Stock to be offered or sold under the Plan.  If the shares of Stock offered for sale or sold under the Plan are offered or sold pursuant to an exemption from registration under the Securities Act, the Company may restrict the transfer of such shares and may legend the Stock certificates representing such shares in such manner as it deems advisable to ensure the availability of any such exemption.
(d)    Tax Withholding.
(i)    A Participant may be required to pay to the Company or any Affiliate and the Company or any Affiliate shall have the right and is hereby authorized to withhold from any shares of Stock or other property deliverable under any Award or from any compensation or other amounts owing to a Participant the amount (in cash, Stock or other property) of any required income tax withholding and payroll taxes in respect of an Award, its exercise, or any payment or transfer under an Award or under the Plan and to take such other action as may be necessary in the opinion of the Company to satisfy all obligations for the payment of such withholding and taxes.
(ii)    Without limiting the generality of clause (i) above, the Committee may, in its sole discretion, permit a Participant to satisfy, in whole or in part, the foregoing withholding liability (but no more than the minimum required withholding liability) by (A) delivery of shares of Stock owned by the Participant, provided that such shares of Stock are not subject to any pledge or other security interest and have such other characteristics as may be determined in the sole discretion of the Committee) with a Fair Market Value equal to such withholding 

17

EXHIBIT 10.1

liability or (B) having the Company withhold from the number of shares of Stock otherwise issuable pursuant to the exercise or settlement of the Award, a number of shares of Common Stock with a Fair Market Value equal to such withholding liability.
(e)    Limitation on Dividend Reinvestment and Dividend Equivalents.  Reinvestment of dividends in additional Restricted Stock at the time of any dividend payment, and the payment of Stock with respect to dividends to Participants holding Awards of Restricted Stock Units, shall only be permissible if sufficient shares of Stock are available under Section 5 for such reinvestment or payment (taking into account then-outstanding Awards).  In the event that sufficient shares of Stock are not available for such reinvestment or payment, such reinvestment or payment shall be made in the form of a grant of Restricted Stock Units equal in number to the shares of Stock that would have been obtained by such payment or reinvestment, the terms of which Restricted Stock Units shall provide for settlement in cash and for dividend equivalent reinvestment in further Restricted Stock Units on the terms contemplated by this Section 12(e).
(f)    Claim to Awards and Employment Rights.  No employee of the Company, Subsidiary or Affiliate, or other person, shall have any claim or right to be granted an Award under the Plan or, having been selected for the grant of an Award, to be selected for a grant of any other Award.  Neither the Plan nor any action taken hereunder shall be construed as giving any Participant any right to be retained in the employ or service of the Company or an Affiliate.
(g)    Designation and Change of Beneficiary.  Each Participant may file with the Company a written designation of one or more persons as the beneficiary who shall be entitled to receive the amounts payable with respect to an Award, if any, due under the Plan upon his or her death.  A Participant may, from time to time, revoke or change his or her beneficiary designation without the consent of any prior beneficiary by filing a new designation with the Company.  The last such designation received by the Company shall be controlling; provided, however, that no designation, or change or revocation thereof, shall be effective unless received by the Company prior to the Participant’s death, and in no event shall it be effective as of a date prior to such receipt.  If no beneficiary designation is filed by a Participant, the beneficiary shall be determined by the laws of descent and distribution.
(h)    Payments to Persons Other Than Participants.  If the Committee shall find that any person to whom any amount is payable under the Plan is unable to care for his or her affairs because of illness or accident, or is a minor, or has died, then any payment due to such person or his or her estate (unless a prior claim therefor has been made by a duly appointed legal representative) may, if the Committee so directs the Company, be paid to his or her guardian or legal representative or any other person deemed by the Committee to be a proper recipient on behalf of such person otherwise entitled to payment.  Any such payment shall be a complete discharge of the liability of the Committee and the Company therefor.
(i)    No Liability of Committee Members.  No member of the Committee shall be personally liable by reason of any contract or other instrument executed by such member or on his or her behalf in his or her capacity as a member of the Committee nor for 

18

EXHIBIT 10.1

any mistake of judgment made in good faith, and the Company shall indemnify and hold harmless each member of the Committee and each other employee, officer or director of the Company to whom any duty or power relating to the administration or interpretation of the Plan may be allocated or delegated against any cost or expense (including counsel fees) or liability (including any sum paid in settlement of a claim) arising out of any act or omission to act in connection with the Plan unless arising out of such person’s own fraud or willful bad faith; provided, however, that approval of the Board shall be required for the payment of any amount in settlement of a claim against any such person.  The foregoing right of indemnification shall not be exclusive of any other rights of indemnification to which such persons may be entitled under the Company’s Certificate of Incorporation or By-Laws, as a matter of law, or otherwise, or any power that the Company may have to indemnify them or hold them harmless.
(j)    Governing Law.  The Plan shall be governed by and construed in accordance with the internal laws of the State of Delaware without regard to the principles of conflicts of law thereof or principles of conflicts of laws of any other jurisdiction that could cause the application of the laws of any jurisdiction other than the State of Delaware.
(k)    Funding.  No provision of the Plan shall require the Company, for the purpose of satisfying any obligations under the Plan, to purchase assets or place any assets in a trust or other entity or otherwise to segregate any assets, nor shall the Company maintain separate bank accounts, books, records or other evidence of the existence of a segregated or separately maintained or administered fund for such purposes.  Participants shall have no rights under the Plan other than as unsecured general creditors of the Company, except that insofar as they may have become entitled to payment of additional compensation by performance of services, they shall have the same rights as other employees under general law.  Notwithstanding any other provision of this Plan to the contrary, with respect to any Award that constitutes a “nonqualified deferred compensation plan” within the meaning of Section 409A of the Code, no trust shall be funded with respect to any such Award if such funding would result in taxable income to the Participant by reason of Section 409A(b) of the Code and in no event shall any such trust assets at any time be located or transferred outside of the United States, within the meaning of Section 409A(b) of the Code.
(l)    Nontransferability.
(i)    Each Award shall be exercisable only by the Participant during the Participant’s lifetime, or, if permissible under applicable law, by the Participant’s legal guardian or representative.  No Award may be assigned, alienated, pledged, attached, sold or otherwise transferred or encumbered by a Participant other than by will or by the laws of descent and distribution and any such purported assignment, alienation, pledge, attachment, sale, transfer or encumbrance shall be void and unenforceable against the Company, Subsidiary or Affiliate; provided that the designation of a beneficiary shall not constitute an assignment, alienation, pledge, attachment, sale, transfer or encumbrance.
(ii)    Notwithstanding the foregoing, the Committee may, in its sole discretion, permit Awards to be transferred by a Participant without consideration, 

19

EXHIBIT 10.1

subject to such rules as the Committee may adopt consistent with any applicable Award Agreement to preserve the purposes of the Plan, to:
		
	(A)
	any person who is a “family member” of the Participant, as such term is used in the instructions to Form S-8 (collectively, the “Immediate Family Members”);

		
	(B)
	a trust solely for the benefit of the Participant and his or her Immediate Family Members;

		
	(C)
	a partnership or limited liability company whose only partners or shareholders are the Participant and his or her Immediate Family Members; or

		
	(D)
	any other transferee as may be approved either (1) by the Board or the Committee in its sole discretion or (2) as provided in the applicable Award Agreement;

(each transferee described in clauses (A), (B), (C) and (D) above is hereinafter referred to as a “Permitted Transferee”); provided that the Participant gives the Committee advance written notice describing the terms and conditions of the proposed transfer and the Committee notifies the Participant in writing that such a transfer would comply with the requirements of this Plan and any applicable Award Agreement.
(iii)    The terms of any Award transferred in accordance with the immediately preceding sentence shall apply to the Permitted Transferee and any reference in this Plan, or in any applicable Award Agreement, to a Participant shall be deemed to refer to the Permitted Transferee, except that (A) Permitted Transferees shall not be entitled to transfer any Award, other than by will or the laws of descent and distribution; (B) Permitted Transferees shall not be entitled to exercise any transferred Option unless there shall be in effect a registration statement on an appropriate form covering the shares of Stock to be acquired pursuant to the exercise of such Option if the Committee determines, consistent with any applicable Award Agreement, that such a registration statement is necessary or appropriate; (C) the Committee or the Company shall not be required to provide any notice to a Permitted Transferee, whether or not such notice is or would otherwise have been required to be given to the Participant under the Plan or otherwise; and (D) the consequences of the termination of the Participant’s employment by, or services to, the Company, or an Affiliate under the terms of the Plan and the applicable Award Agreement shall continue to be applied with respect to the Participant, including, without limitation, that an Option shall be exercisable by the Permitted Transferee only to the extent, and for the periods, specified in the Plan and the applicable Award Agreement.
(m)    Section 409A of the Code.  It is the intention of the Company that no Award shall be “deferred compensation” subject to Section 409A of the Code, unless and 

20

EXHIBIT 10.1

to the extent that the Committee specifically determines otherwise as provided in this Section 12(m), and the Plan and the terms and conditions of all Awards shall be interpreted accordingly.  The terms and conditions governing any Awards that the Committee determines will be subject to Section 409A of the Code, including any rules for elective or mandatory deferral of the delivery of cash or Shares pursuant thereto and any rules regarding treatment of such Awards in the event of a Change in Control, shall be set forth in the applicable Award Agreement and shall comply in all respects with Section 409A of the Code.  Notwithstanding any other provision of the Plan to the contrary, with respect to any Award that constitutes a “nonqualified deferred compensation plan” subject to Section 409A of the Code that has been granted to a Participant who is a “specified employee” (within the meaning of Section 409A) on the date of the Participant’s Termination of Service, any payments (whether in cash, Shares or other property) to be made with respect to such Award upon the Participant’s Termination of Service shall be delayed until the earlier of (i) the first day of the seventh month following the Participant’s Termination of Service and (ii) the Participant’s death.
(n)    Reliance on Reports.  Each member of the Committee and each member of the Board shall be fully justified in acting or failing to act, as the case may be, and shall not be liable for having so relied, acted or failed to act in good faith, in reliance upon any report made by the independent public accountant of the Company and its Affiliates and/or any other information furnished in connection with the Plan by any person or persons other than himself.
(o)    Relationship to Other Benefits.  No payment under the Plan shall be taken into account in determining any benefits under any pension, retirement, profit sharing, group insurance or other benefit plan of the Company or any Subsidiary except as otherwise specifically provided in such other plan.
(p)    Additional Compensation Arrangements.  Nothing contained in the Plan shall prevent the company or any Subsidiary or Affiliate from adopting other or additional compensation arrangements for its employees.
(q)    Subsidiary Employee.  In the case of a grant of an Award to any employee of a Subsidiary of the Company, the Company may, if the Committee so directs, issue or transfer the Shares, if any, covered by the Award to the Subsidiary, for such lawful consideration as the Committee may specify, upon the condition or understanding that the Subsidiary will transfer the Shares to the employee in accordance with the terms of the Award specified by the Committee pursuant to the provisions of the Plan.  All Shares underlying Awards that are forfeited or canceled should revert to the Company.
(r)    Foreign Employees and Foreign Law Considerations.  The Committee may grant Awards to Eligible Persons who are foreign nationals, who are located outside the United States or who are not compensated from a payroll maintained in the United States, or who are otherwise subject to (or could cause the Company to be subject to) legal or regulatory provisions of countries or jurisdictions outside the United States, on such terms and conditions different from those specified in the Plan as may, in the judgment of the Committee, be necessary or desirable to foster and promote achievement of the purposes of the Plan, and, in furtherance of such purposes, the Committee may make such 

21

EXHIBIT 10.1

modifications, amendments, procedures or subplans as may be necessary or advisable to comply with such legal or regulatory.
(s)    No Contract of Employment.  The Plan shall not constitute a contract of employment, and adoption of the Plan shall not confer upon any employee any right to continued employment, nor shall it interfere in any way with the right of the Company or any Subsidiary or Affiliate to terminate the employment of any employee at any time.
(t)    Expenses.  The expenses of administering the Plan shall be borne by the Company and its Affiliates.
(u)    Pronouns.  Masculine or neuter pronouns and other words of masculine gender shall refer to both men and women.
(v)    Titles and Headings.  The titles and headings of the sections in the Plan are for convenience of reference only and, in the event of any conflict, the text of the Plan, rather than such titles or headings, shall control.
(w)    Severability.  If any provision of the Plan or any Award Agreement is or becomes or is deemed to be invalid, illegal or unenforceable in any jurisdiction or as to any person or Award, or would disqualify the Plan or any Award under any law deemed applicable by the Committee, such provision shall be construed or deemed amended to conform to the applicable laws, or if it cannot be construed or deemed amended without, in the determination of the Committee, materially altering the intent of the Plan or the Award, such provision shall be stricken as to such jurisdiction, person or Award and the remainder of the Plan and any such Award shall remain in full force and effect.
13.    Changes in Capital Structure
(a)    In the event of a merger, consolidation, acquisition of property or shares, stock rights offering, liquidation, Disaffiliation, or similar event affecting the Company or any of its Subsidiaries (each, a “Corporate Transaction”), the Committee or the Board shall make such substitutions or adjustments as it deems appropriate and equitable to (A) the aggregate number and kind of Stock or other securities reserved for issuance and delivery under the Plan, (B) the various maximum limitations set forth in Section 5 upon certain types of Awards and upon the grants to individuals of certain types of Awards, (C) the number and kind of Stock or other securities subject to outstanding Awards and (D) the exercise price of outstanding Options and Stock Appreciation Rights.  In the case of Corporate Transactions, such adjustments may include, without limitation, (1) the cancellation of outstanding Awards in exchange for payments of cash, property or a combination thereof having an aggregate value equal to the value of such Awards, as determined by the Committee or the Board in its sole discretion (it being understood that in the case of a Corporate Transaction with respect to which stockholders of common stock receive consideration other than publicly traded equity securities of the ultimate surviving entity, any such determination by the Committee that the value of an Option or Stock Appreciation Right shall for this purpose be deemed to equal the excess, if any, of the value of the consideration being paid for each Share pursuant to such Corporate Transaction over 

22

EXHIBIT 10.1

the exercise price of such Option or Stock Appreciation Right shall conclusively be deemed valid); (2) the substitution of other property (including, without limitation, cash or other securities of the Company and securities of entities other than the Company) for the Stock subject to outstanding Awards; and (3) in connection with any Disaffiliation, arranging for the assumption of Awards, or replacement of Awards with new awards based on other property or other securities (including, without limitation, other securities of the Company and securities of entities other than the Company), by the affected Subsidiary, Affiliate or division or by the entity that controls such Subsidiary, Affiliate or division following such Disaffiliation (as well as any corresponding adjustments to Awards that remain based upon Company securities).
(b)    In the event of a stock dividend, stock split, reverse stock split, separation, spinoff, reorganization, extraordinary dividend of cash or other property, share combination, or recapitalization or similar event affecting the capital structure of the Company (each, a “Stock Change”), the Committee or the Board shall make such substitutions or adjustments as it deems appropriate and equitable to (i) the aggregate number and kind of Shares or other securities reserved for issuance and delivery under the Plan, (ii) the various maximum limitations set forth in Section 5 upon certain types of Awards and upon the grants to individuals of certain types of Awards, (iii) the number and kind of Shares or other securities subject to outstanding Awards and (iv) the exercise price of outstanding Options and Stock Appreciation Rights.
(c)    The Committee may adjust in its sole discretion the Performance Goals applicable to any Awards to reflect any Stock Change and any Corporate Transaction and any unusual or nonrecurring events and other extraordinary items, impact of charges for restructurings, discontinued operations and the cumulative effects of accounting or tax changes, each as defined by generally accepted accounting principles or as identified in the Company’s financial statements, notes to the financial statements, management’s discussion and analysis or the Company’s other SEC filings; provided that with respect to Awards granted on and after the 162(m) Effective Date that are intended to qualify as “performance-based compensation” under Section 162(m) of the Code, such adjustments or substitutions shall be made only to the extent that the Committee determines that such adjustments or substitutions may be made without causing the Company to be denied a tax deduction on account of Section 162(m) of the Code.  The Company shall give each Participant notice of an adjustment hereunder and, upon notice, such adjustment shall be conclusive and binding for all purposes.
(d)    Any adjustment under this Section 13 need not be the same for all Participants.
(e)    Notwithstanding the foregoing:  (i) any adjustments made pursuant to this Section 13 to Awards that are considered “deferred compensation” within the meaning of Section 409A of the Code shall be made in compliance with the requirements of Section 409A of the Code; (ii) any adjustments made pursuant to this Section 13 to Awards that are not considered “deferred compensation” subject to Section 409A of the Code shall be made in such a manner as to ensure that, after such adjustment, the Awards either (A) continue not to be subject to Section 409A of the Code or (B) comply with the requirements of Section 

23

EXHIBIT 10.1

409A of the Code; and (iii) in any event, neither the Committee nor the Board shall have the authority to make any adjustments pursuant to this Section 13 to the extent the existence of such authority would cause an Award that is not intended to be subject to Section 409A of the Code to be subject thereto.
14.    Effect of Change in Control
(a)    Impact of Event/Single Trigger.  Unless otherwise provided in the applicable Award Agreement and subject to Sections 12(l) and 13, notwithstanding any other provision of the Plan to the contrary, immediately upon the occurrence of a Change in Control that occurs following GSE Approval:
(i)    any Options and Stock Appreciation Rights outstanding that are not then exercisable and vested shall become fully exercisable and vested;
(ii)    the restrictions, including the Restricted Period, which may differ with respect to each grantee, and deferral limitations applicable to any Restricted Stock shall lapse and such Restricted Stock shall become free of all restrictions and become fully vested and transferable;
(iii)    all Awards (other than Options, Stock Appreciation Rights and Restricted Stock) shall be considered to be earned and payable in full, and any restrictions shall lapse and such Restricted Stock Units shall be settled as promptly as is practicable in the form set forth in the applicable Award Agreement; provided, however, that with respect to any such Award that constitutes a “nonqualified deferred compensation plan” within the meaning of Section 409A of the Code, the settlement of each such Award pursuant to this Section 14(a)(iii) shall not occur until the earliest of (A) the Change in Control if such Change in Control constitutes a “change in the ownership of the corporation,” a “change in effective control of the corporation” or a “change in the ownership of a substantial portion of the assets of the corporation,” within the meaning of Section 409A(a)(2)(A)(v) of the Code (each, a “409A Change in Control”) and (B) the date such Award would otherwise be settled pursuant to the terms of the Award Agreement; and
(iv)    with respect to Performance-Based Restricted Awards, the Committee shall (A) determine the extent to which Performance Goals with respect to each Performance Period have been met based upon such audited or unaudited financial information or other inputs deemed relevant or appropriate in the discretion of the Committee then available as it deems relevant and (B) cause to be paid to each Participant in accordance with paragraphs (i) through (iii) of this Section 14(a) partial or full Awards with respect to Performance Goals for each such Performance Period based upon the Committee’s determination of the degree of attainment of Performance Goals; provided, however, that with respect to any Performance-Based Restricted Award that constitutes a “nonqualified deferred compensation plan” within the meaning of Section 409A of the Code, the payment of each such Award pursuant to this Section 14(a)(iv) shall not occur until the earliest of (1) the Change in Control if such Change in Control constitutes a 409A Change in Control and (2) 

24

EXHIBIT 10.1

the date such Award would otherwise be settled pursuant to the terms of the Award Agreement;
(v)    the Committee may in its discretion, and upon at least 10 days’ advance notice to the affected persons, cancel any outstanding Awards and pay to the holders thereof, in cash or stock, or any combination thereof, the value of such Awards based upon the price per share of Stock received or to be received by other stockholders of the Company in the event, but only to the extent such payment is permitted under Section 409A of the Code; and
(vi)    the Committee may also make additional adjustments and/or settlements of outstanding Awards as it deems appropriate and consistent with the Plan’s purposes.
(b)    The obligations of the Company under the Plan shall be binding upon any successor corporation or organization resulting from the merger, consolidation or other reorganization of the Company, or upon any successor corporation or organization succeeding to substantially all of the assets and business of the Company.  The Company agrees that it will make appropriate provisions for the preservation of Participants’ rights under the Plan in any agreement or plan that it may enter into or adopt to effect any such merger, consolidation, reorganization or transfer of assets.
15.    Nonexclusivity of the Plan
Neither the adoption of this Plan by the Board nor the submission of this Plan to the stockholders of the Company for approval shall be construed as creating any limitations on the power of the Board to adopt such other incentive arrangements as it may deem desirable, including, without limitation, the granting of stock options otherwise than under this Plan, and such arrangements may be either applicable generally or only in specific cases.
16.    Amendments and Termination
(a)    Amendment and Termination of the Plan.  The Board may amend, alter, suspend, discontinue or terminate the Plan or any portion thereof at any time; provided that no such amendment, alteration, suspension, discontinuation or termination shall be made without stockholder approval if such approval is necessary to comply with any tax or regulatory requirement applicable to the Plan (including as necessary to prevent Awards granted under the Plan on and after the 162(m) Effective Date from failing to qualify as “performance-based compensation” for purposes of Section 162(m) of the Code); and provided further that any such amendment, alteration, suspension, discontinuance or termination that would impair the rights of any Participant or any holder or beneficiary of any Award theretofore granted shall not to that extent be effective without the consent of the affected Participant, holder or beneficiary, except such an amendment made to comply with applicable law, including, without limitation, Section 409A of the Code, Applicable Exchange rules or accounting rules.  On and after the 162(m) Effective Date, in no event may any Option or Free-Standing SAR granted under this Plan be amended, other than 

25

EXHIBIT 10.1

pursuant to Section 13, to decrease the exercise price thereof, cancelled in conjunction with the grant of any new Option or Free-Standing SAR with a lower exercise price, or otherwise be subject to any action that would be treated, for accounting purposes, as a “repricing” of such Option or Free-Standing SAR, unless such amendment, cancellation or action is approved by the Company’s stockholders.  Prior to the listing of the Company’s Common Stock on the NYSE or The Nasdaq Global Market, no amendment to the Plan that would increase the number of Reserved Shares shall be made without prior stockholder approval.
(b)    Amendment of Award Agreements.  The Committee may, to the extent consistent with the terms of any applicable Award Agreement, waive any conditions or rights under, amend any terms of, or alter, suspend, discontinue, cancel or terminate, any Award theretofore granted or the associated Award Agreement, prospectively or retroactively; provided that (i) any such waiver, amendment, alteration, suspension, discontinuance, cancellation or termination that would impair the rights of any Participant or any holder or beneficiary of any Award theretofore granted shall not to that extent be effective without the consent of the affected Participant, holder or beneficiary and (ii) no such amendment shall cause any Award that is intended to qualify as “performance-based compensation” under Section 162(m) to fail to qualify as “performance-based compensation” under Section 162(m) of the Code.
*      *      *
As adopted by the Board of Directors of NMI Holdings, Inc. as of  
April 16, 2012.

2610.2 Form of NMI Holdings Inc. 2012 Stock Incentive Plan Rest Stock Unit Award Agmt CEO and CFO

EXHIBIT 10.2

NMI HOLDINGS, INC. 
2012 STOCK INCENTIVE PLAN 
RESTRICTED STOCK UNIT AWARD AGREEMENT 
(FOR CEO/CFO)
THIS RESTRICTED STOCK UNIT AWARD AGREEMENT (this “Agreement”), dated as of [●] (the “Date of Grant”), is made by and between NMI Holdings, Inc., a Delaware corporation (the “Company”), and [NAME] (“Participant”).
WHEREAS, the Company has adopted the NMI Holdings, Inc. 2012 Stock Incentive Plan (the “Plan”); and
WHEREAS, the Committee has determined that it would be in the best interests of the Company and its stockholders to grant Participant restricted stock units with respect to a number of shares of the Company’s Common Stock (the “Shares”) on the terms and subject to the conditions set forth in this Agreement and the Plan.
NOW THEREFORE, for and in consideration of the premises and the covenants of the parties contained in this Agreement, and for other good and valuable consideration, the receipt of which is hereby acknowledged, the parties hereto, for themselves, their successors and assigns, hereby agree as follows:
1.Grant of Restricted Stock Unit Award.
(a)    Grant.  The Company hereby grants to Participant an award of [●] restricted stock units (the “RSUs”) on the terms and conditions set forth in this Agreement and as otherwise provided in the Plan.
(b)    Incorporation by Reference, Etc.  The provisions of the Plan are hereby incorporated herein by reference.  Except as otherwise expressly set forth herein, this Agreement shall be construed in accordance with the provisions of the Plan and any capitalized terms not otherwise defined in this Agreement shall have the definitions set forth in the Plan.
2.    Vesting.  (a) Except as may otherwise be provided herein, the RSUs shall vest based on the achievement of certain Stock Price Goals (as set forth in each of clauses 2(a)(i), 2(a)(ii) and 2(a)(iii) below).  Subject to Participant’s continued employment and the Company achieving GSE Approval prior to the GSE Approval Deadline:
(i)    one-third of the RSUs (rounded up to the nearest whole share) shall vest upon the Stock Price (as defined in Section 2(b) below) of a Share equaling or exceeding $12.50 per Share;
(ii)    one-third of the RSUs (rounded up to the nearest whole share) shall vest upon the Stock Price of a Share equaling or exceeding $14.00 per Share; and
(iii)    the remainder of the RSUs shall vest upon the Stock Price of a Share equaling or exceeding $16.00 per Share.

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EXHIBIT 10.2

(b)    Determination of Stock Price.  The “Stock Price” per Share, for purposes of determining whether the RSUs vest, shall be determined as follows:
(i)    If the Shares are traded on an Applicable Exchange, the Stock Price shall be the average closing price of the Shares on such exchange for any consecutive 30-day trading period;
(ii)    If the Shares are actively traded over-the-counter, the Stock
(iii)    Price shall be the average of the closing bid price over any consecutive 30-day trading period;
(iv)    If the Shares are traded on the FBR PlusTM System, the Stock Price shall be the average sales price reported on the FBR PlusTM System over any consecutive 30-day trading period; and
(v)    If the Shares are not traded on any market identified in this Section 2(b), the Stock Price shall be the fair market value of the Shares determined based on the procedures prescribed by Treas. Reg. Section 1.409A-1(b)(5)(iv)(B).
(c)    Termination of Service.  Except as provided in the immediately following sentence, in the event that Participant incurs a Termination of Service, unvested RSUs shall be forfeited without consideration by Participant.  Notwithstanding the foregoing, in the event that Participant incurs a Termination of Service without “Cause” (as defined in Participant’s employment agreement with the Company) or for “Good Reason” (as defined in Participant’s employment agreement with the Company), unvested RSUs shall remain outstanding and shall vest upon the later of (i) GSE Approval and (ii) the achievement of the Stock Price Goals as determined in a manner consistent with Sections 2(a) and 2(b) above; provided that, any RSUs granted pursuant to this Agreement that remain unvested as of the tenth anniversary of the Date of Grant shall be forfeited.
(d)    GSE Approval.  Notwithstanding the foregoing provisions of this Section 2, no RSUs shall vest prior to the Company’s achievement of GSE Approval and, in the event that the Company does not achieve GSE Approval prior to the GSE Approval Deadline, any RSUs held by Participant shall be forfeited without any consideration.
3.    Settlement.  As soon as practicable after any RSUs have vested (and in any event, no later than fifteen business days immediately following such vesting), such RSUs shall be settled.  Subject to Section 4 (pertaining to the withholding of taxes), for each vested RSU settled pursuant to this Section 3, the Company shall issue to Participant one Share.
4.    Tax Withholding.  The Company shall have the power and the right to deduct or withhold, or require Participant to remit to the Company, an amount sufficient to satisfy any federal, state, local and foreign taxes of any kind (including, but not limited to, Participant’s FICA and SDI obligations) which the Company, in its sole discretion, deems necessary to be withheld or remitted to comply with the Code and/or any other applicable law, 

2

EXHIBIT 10.2

rule or regulation with respect to the RSUs and, if Participant fails to do so, the Company may otherwise refuse to issue or transfer any Shares otherwise required to be issued pursuant to this Agreement.  Any statutorily required withholding obligation with regard to Participant may be satisfied, at the discretion of the Company, by reducing the amount of Shares otherwise deliverable to Participant hereunder.
5.    No Rights as Stockholder.  Until such time as the RSUs have been settled and the underlying Shares have been delivered to Participant and Participant has become the holder of record of such Shares, Participant shall have no rights as a stockholder, including, without limitation, the right to dividends and the right vote.
6.    Transferability.  The RSUs may not, at any time prior to becoming vested, be assigned, alienated, pledged, attached, sold or otherwise transferred or encumbered by Participant other than by will or by the laws of descent and distribution and any such purported assignment, alienation, pledge, attachment, sale, transfer or encumbrance shall be void and unenforceable against the Company, its Subsidiary or Affiliate; provided that the designation of a beneficiary shall not constitute an assignment, alienation, pledge, attachment, sale, transfer or encumbrance.  Prior to the Shares becoming listed on an Applicable Exchange, any Shares received by Participant in settlement of the RSUs may not be assigned, alienated, pledged, attached, sold or otherwise transferred or encumbered by Participant without the prior written approval of the Board, such approval not to be unreasonably withheld.
7.    Securities Law Representations.  Participant acknowledges that the Shares underlying the RSUs are not being registered under the Securities Act, based, in part, on reliance upon an exemption from registration under Rule 701 or Regulation D promulgated under the Securities Act and a comparable exemption from qualification under applicable state securities laws, as each may be amended from time to time.  Participant, by executing this Agreement, hereby makes the following representations to the Company and acknowledges that the Company’s reliance on federal and state securities law exemptions from registration and qualification is predicated, in substantial part, upon the accuracy of these representations:
		
	•
	Participant is acquiring the RSUs solely for Participant’s own account, for investment purposes only, and not with a view or an intent to sell, or to offer for resale in connection with any unregistered distribution, all or any portion of the shares within the meaning of the Securities Act and/or any applicable state securities laws.

		
	•
	Participant is an “accredited investor,” as that term is defined in Rule 501(a)(1), (2) or (3) of Regulation D promulgated under the Securities Act.

		
	•
	Participant has had an opportunity to ask questions and receive answers from the Company regarding the terms and conditions of the RSUs.  Participant has been furnished with, and/or has access to, such information as Participant considers necessary or appropriate for deciding whether to purchase the Shares underlying the RSUs.  However, in evaluating the merits and risks of an investment in the 

3

EXHIBIT 10.2

Shares underlying the RSUs, Participant has and will rely only upon the advice of Participant’s own legal counsel, tax advisors and/or investment advisors.
		
	•
	Participant is aware that any value the RSUs may have depends on vesting and certain other factors, and that any investment in common shares of a closely held corporation such as the Company is non-marketable, nontransferable and could require capital to be invested for an indefinite period of time, possibly without return, and at substantial risk of loss.

		
	•
	Participant understands that the RSUs will be characterized as “restricted securities” under the federal securities laws and that, under such laws and applicable regulations, such securities may be resold without registration under the Securities Act only in certain limited circumstances, including in accordance with the conditions of Rule 144 promulgated under the Securities Act, as presently in effect.  Participant acknowledges receiving a copy of Rule 144 promulgated under the Securities Act, as presently in effect, and represents that Participant is familiar with such rule and understands the resale limitations imposed thereby and by the Securities Act and the applicable state securities law.

		
	•
	Participant has read and understands the restrictions, limitations and the Company’s rights set forth in the Plan and this Agreement that will be imposed on the RSUs (including those restrictions and limitations that will continue after the RSUs have vested).

		
	•
	Participant has not relied upon any oral representation made to Participant relating to the Shares or upon information presented in any promotional meeting or material relating to the RSUs.

		
	•
	Participant understands and acknowledges that (a) any certificate evidencing the RSUs (or evidencing any other securities issued with respect thereto pursuant to any stock split, stock dividend, merger or other form of reorganization or recapitalization) when issued shall bear any legends that may be required by applicable federal and state securities laws, this Agreement or the Plan and (b) the Company has no obligation to register the Shares or file any registration statement under federal or state securities laws.  The Committee reserves the right to account for Shares through book entry or other electronic means rather than the issuance of stock certificates.

8.    Adjustment.  Upon any event described in Section 13 of the Plan occurring after the Date of Grant, the adjustment provisions as provided for under Section 13 of the Plan shall apply to the RSUs, both with respect to the number of RSUs and with respect to the Stock Price Goals.
9.    Change in Control.  In the event of a Change in Control of the Company occurring after the Date of Grant, the Committee shall (A) determine the extent to which the Stock Price Goals with respect to the RSUs have been met based upon such audited or unaudited 

4

EXHIBIT 10.2

financial information or other inputs deemed relevant or appropriate in the discretion of the Committee then available as it deems relevant and (B) provide for the vesting of the applicable number of RSUs, if any, based upon the Committee’s determination of the degree of attainment of the Stock Price Goals.  Any RSUs that vest in connection with this Section 9 shall be settled in a manner consistent with Section 3 of this Agreement.
10.    Miscellaneous.
(a)    Confidentiality of this Agreement.  Participant agrees to keep confidential the terms of this Agreement, unless and until such terms have been disclosed publicly other than through a breach by Participant of this covenant.  This provision does not prohibit Participant from providing this information on a confidential and privileged basis to Participant’s attorneys or accountants for purposes of obtaining legal or tax advice or as otherwise required by law.
(b)    Waiver and Amendment.  The Committee may waive any conditions or rights under, or amend any terms of, this Agreement and the RSUs granted thereunder; provided that any such waiver or amendment that would impair the rights of any Participant or any holder or beneficiary of any RSUs theretofore granted shall not to that extent be effective without the consent of Participant.  No waiver of any right hereunder by any party shall operate as a waiver of any other right, or as a waiver of the same right with respect to any subsequent occasion for its exercise, or as a waiver of any right to damages.  No waiver by any party of any breach of this Agreement shall be held to constitute a waiver of any other breach or a waiver of the continuation of the same breach.
(c)    Unsecured Obligation.  This Award is unfunded, and even as to any RSUs which vest, Participant shall be considered an unsecured creditor of the Company with respect to the Company’s obligations, if any, to issue Shares pursuant to this Agreement.  Nothing contained in this Agreement, and no action taken pursuant to its provisions, shall create or be construed to create a trust of any kind or a fiduciary relationship between Participant and the Company or any other person.
(d)    Notices.  All notices, demands and other communications provided for or permitted hereunder shall be made in writing and shall be by registered or certified first- class mail, return receipt requested, facsimile, courier service or personal delivery:
if to the Company:
NMI Holdings, Inc. 
[ADDRESS] 
Facsimile:  [●] 
Attention:  [NAME]
if to Participant:  at the address last on the records of the Company.

5

EXHIBIT 10.2

All such notices, demands and other communications shall be deemed to have been duly given when delivered by hand, if personally delivered; when delivered by courier, if delivered by commercial courier service; five business days after being deposited in the mail, postage prepaid, if mailed; and when receipt is mechanically acknowledged, if by facsimile.
(e)    Severability.  The invalidity or unenforceability of any provision of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement, and each other provision of this Agreement shall be severable and enforceable to the extent permitted by law.
(f)    No Rights to Service.  Nothing contained in this Agreement shall be construed as giving Participant any right to be retained, in any position, as an employee, consultant or director of the Company or its Affiliates or shall interfere with or restrict in any way the right of the Company or its Affiliates, which is hereby expressly reserved, to remove, terminate or discharge Participant at any time for any reason whatsoever.
(g)    Beneficiary.  Participant may file with the Company a written designation of a beneficiary on such form as may be prescribed by the Committee and may, from time to time, change or revoke such designation by filing a new designation with the Company.  The last such designation received by the Company shall be controlling; provided, however, that no designation, or change or revocation thereof, shall be effective unless received by the Company prior to Participant’s death, and in no event shall it be effective as of a date prior to such receipt.  If no beneficiary designation is filed by Participant, the beneficiary shall be deemed to be his spouse or, if Participant is unmarried at the time of death, his estate.
(h)    Successors.  The terms of this Agreement shall be binding upon and inure to the benefit of the Company, its successors and assigns, and of Participant and the beneficiaries, executors, administrators, heirs and successors of Participant.
(i)    Entire Agreement.  This Agreement and the Plan contain the entire agreement and understanding of the parties hereto with respect to the subject matter contained herein and supersede all prior communications, representations and negotiations with respect thereto.
(j)    Bound by the Plan.  By signing this Agreement, Participant acknowledges that he has received a copy of the Plan and has had an opportunity to review the Plan and agrees to be bound by all the terms and provisions of the Plan.
(k)    Section 409A.  It is intended that the Awards granted pursuant to this Agreement and the provisions of this Agreement be exempt from or comply with Section 409A of the Code, and all provisions of this Agreement shall be construed and interpreted in a manner consistent with the requirements for avoiding taxes or penalties under Section 409A of the Code.
(l)    Governing Law.  This Agreement shall be construed and interpreted in accordance with the internal laws of the State of Delaware without regard to 

6

EXHIBIT 10.2

principles of conflicts of law thereof, or principles of conflicts of laws of any other jurisdiction that could cause the application of the laws of any jurisdiction other than the State of Delaware.
(m)    Headings.  The headings of the Sections hereof are provided for convenience only and are not to serve as a basis for interpretation or construction, and shall not constitute a part, of this Agreement.
(n)    Signature in Counterparts.  This Agreement may be signed in counterparts, each of which shall be an original, with the same effect as if the signatures thereto and hereto were upon the same instrument.
11.    Compliance with Legal Requirements.  The grant of the RSUs, and any other obligations of the Company under this Agreement shall be subject to all applicable federal and state laws, rules and regulations and to such approvals by any regulatory or governmental agency as may be required.  The Committee, in its sole discretion, may postpone the issuance or delivery of Shares as the Committee may consider appropriate and may require Participant to make such representations and furnish such information as it may consider appropriate in connection with the issuance or delivery of the Shares in compliance with applicable laws, rules and regulations
[Remainder of page intentionally left blank; signature page to follow]

7

EXHIBIT 10.2

IN WITNESS WHEREOF, the parties hereto have executed this Agreement.
	
		
	NMI HOLDINGS, INC.

	 

	 

	By:
	 

	Title:
	 

	 

	 

	PARTICIPANT

	 

	 

	 

8

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