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1.	To elect our board of directors;

2.	To vote, on an advisory basis, on executive compensation;

3.	To approve an amendment to our employee stock purchase plan to increase by 250,000 the number of Common Shares that employees may purchase under such plan;

4.	To ratify the appointment of PricewaterhouseCoopers LLP as AGL's independent auditors for the fiscal year ending December 31, 2013;

5.	To direct AGL to vote for directors of, and the ratification of the appointment of independent auditors for, its subsidiary Assured Guaranty Re Ltd.; and

6.	To transact such other business, if any, as lawfully may be brought before the meeting.

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•	Election of directors

•	Advisory vote on executive compensation

•	Amendment of our employee stock purchase plan to increase by 250,000 the number of our Common Shares that our employees may purchase under such plan

•	Ratification of PricewaterhouseCoopers LLP as independent auditor of AGL

•	Direction of AGL to vote for directors of, and the ratification of independent auditor of, AGL's subsidiary, Assured Guaranty Re Ltd.

•	Transaction of other business that may properly come before the meeting

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•	Certain payments and benefits following a voluntary termination, other than for good reason, within a specified period following a change of control

•	In February 2012, the CEO received a multi-year equity award

•	Vesting of these awards is tied to achievement of share price hurdles prior to December 31, 2014

•	The CEO and other executive officers forfeit their 2012 equity awards if they retire or resign from our Company prior to vesting

•	The equity awards have "double trigger" vesting in the event of a change in control

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•	The election of directors

•	An advisory vote to approve executive compensation

•	The approval of an amendment to our employee stock purchase plan to increase by 250,000 the number of our Common Shares that our employees may purchase under such plan

•	The ratification of the selection of PricewaterhouseCoopers LLP, an independent registered public accounting firm, which we refer to as PwC, as our independent auditors for 2013

•	The direction of AGL to vote for the election of the directors of, and the ratification of the appointment of the independent auditors for, our subsidiary Assured Guaranty Re Ltd. (which we refer to as AG Re)

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Shareholder of Record.  If your shares are registered directly in your name with our transfer agent, Computershare, you are considered, with respect to those shares, the shareholder of record and these proxy materials are being sent to you directly. As the shareholder of record, you have the right to grant your voting proxy directly to AGL or to vote in person at the Annual General Meeting. You may vote by telephone or via the Internet as described below under the heading "Information About the Annual General Meeting and Voting—May I vote by telephone or via the Internet?" or you may request a paper copy of the proxy materials and vote your proxy card by mail.

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Beneficial Owner.  If your shares are held in a stock brokerage account or by a bank or other nominee, you are considered the beneficial owner of shares held in "street name" and our proxy materials are being forwarded to you by your broker or nominee who is considered, with respect to those shares, the shareholder of record. As the beneficial owner, you have the right to direct your broker or nominee on how to vote your shares and are also invited to attend the Annual General Meeting. However, since you are not the shareholder of record, you may only vote these shares in person at the Annual General Meeting if you follow the instructions described below under the heading "Information About the Annual General Meeting and Voting—How do I vote in person at the Annual General Meeting?" Your broker or nominee has provided a voting instruction card for you to use in directing your broker or nominee as to how to vote your shares. You may also vote by

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•	FOR the election of directors

•	FOR approval of our executive compensation

•	FOR approval of an amendment to our employee stock purchase plan

•	FOR the ratification of PwC as our independent auditors for 2013

•	FOR directing AGL to vote for the election of directors of, and the ratification of the appointment of independent auditors for, our subsidiary, AG Re

•	Brokers have discretionary power to vote your shares with respect to "routine" matters

•	Brokers do not have discretionary power to vote your shares on "non-routine" matters (such as the election of directors or the advisory vote on executive compensation) unless they have received instructions from the beneficial owner of the shares

•	If you are a shareholder of record, you may vote by telephone, or electronically through the Internet, by following the instructions provided on the Notice

•	If you are a beneficial owner and hold your shares in "street name," you may need to contact your bank or broker to determine whether you will be able to vote by telephone or electronically through the Internet

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•	Send in another signed proxy with a later date or resubmit your vote by telephone or the Internet,

•	Send a letter revoking your proxy to our Secretary at 30 Woodbourne Avenue, Hamilton HM 08, Bermuda, or

•	Attend the Annual General Meeting and vote in person.

•	The election of each nominee for director

•	The ratification of the selection of PwC as independent auditors for 2013

•	Directing AGL to vote for the election of directors of, and the ratification of the appointment of independent auditors for, our subsidiary, AG Re

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•	In the election of AGL directors, your vote may be cast "FOR" all of the nominees or your vote may be "WITHHELD" with respect to one or more of the nominees

•	Your vote may be cast "FOR" or "AGAINST" or you may "ABSTAIN" with respect to the proposals relating to (i) the advisory vote on executive compensation, (ii) the ratification of AGL's independent auditors, (iii) the amendment to the employee stock purchase plan, and (iv) directing AGL to vote for the ratification of the appointment of AG Re's independent auditors

•	With respect to directing AGL to vote for the election of directors of our subsidiary, AG Re, your vote may be cast "FOR" all of the nominees or your vote may be "WITHHELD" with respect to one or more of the nominees

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•	Shareholders, employees or other interested parties wanting to contact the Board concerning accounting or auditing matters may send an e-mail to the Chairman of the Audit Committee at chmaudit@assuredguaranty.com

•	Shareholders, employees or other interested parties wanting to contact the Board, the independent directors, the Chairman of the Board, the chairman of any Board committee or any other director, as to other matters may send an e-mail to corpsecy@assuredguaranty.com. The Secretary has access to both of these e-mail addresses

•	Shareholders, employees or other interested parties may send written communications to the Board c/o Secretary, 30 Woodbourne Avenue, Hamilton HM 08, Bermuda. Mail to Bermuda is not as prompt as e-mail

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•	The Chairman of the Board receives an additional $125,000 annual retainer

•	The Chairman of the Audit Committee receives an additional $30,000 annual retainer

•	The Chairman of each of the Compensation Committee, the Nominating and Governance Committee, the Finance Committee and the Risk Oversight Committee receives an additional $15,000 annual retainer

•	Members of the Audit Committee, other than the chairman, receive an additional $15,000 annual retainer

•	Members, other than the chairmen, of each of the Compensation Committee, the Nominating and Governance Committee, the Finance Committee and the Risk Oversight Committee receive an additional $10,000 annual retainer.

(1)	Other compensation consists of matching gift donations which were paid in 2012.

(2)	The cash component of Mr. Baron's compensation was $125,000, of which he elected to receive $10,000 in additional restricted stock and the remainder in cash.

(3)	The cash component of Mr. Borges's compensation was $125,000, of which he elected to receive $100,000 in additional restricted stock and the remainder in cash.

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(4)	The cash component of Mr. Kenny's compensation was $140,000, of which he elected to receive $35,000 in additional restricted stock and the remainder in cash.

(5)	Mr. Layton resigned from our Board in May 2012 and did not receive any compensation for 2012.

(6)	Mr. Leathes is a nominee to our Board. He was appointed an independent director of our UK insurance subsidiaries, Assured Guaranty (UK) Ltd. and Assured Guaranty (Europe) Ltd., in December 2011 and in 2012 received £45,000 (which is approximately $72,734) for such service.

(7)	The fees for Mr. Monro-Davies include £43,750 (which is approximately $70,713) for serving as an independent director of Assured Guaranty (UK) Ltd. and Assured Guaranty (Europe) Ltd.

(1)	Vests one day prior to the 2013 Annual General Meeting.

(2)	Mr. Layton resigned from our Board in May 2012 and did not hold any unvested restricted stock, non-forfeitable restricted share units or non-forfeitable stock options in our Company as of December 31, 2012.

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•	the balance between short- and long-term incentives

•	consideration of qualitative non-financial performance goals, including enterprise risk, as well as quantitative financial performance goals, in determining compensation payouts, with a discretionary approach to annual bonus award allocations

•	incentive compensation components that are paid, vested or measured over an extended period, thus encouraging a long-term outlook

•	incentive compensation with a significant equity component where value is best realized through long-term appreciation of shareholder value

•	the performance retention plan focus on adjusted book value and operating return on equity over a multi-year performance period, which reduces the incentive to concentrate on short-term gain, and like equity awards granted under the long-term incentive plan, which fosters a long-term view that minimizes unnecessary or excessive risk taking

•	stock ownership guidelines that tie executives to our Company's future business performance and align executives' interests with those of shareholders (e.g., 7x base salary for the CEO)

•	a prohibition against short-selling, buying Company shares on margin or using owned shares as collateral for margin accounts, which ensures that employees maintain appropriate exposure to changes in our Company's stock price and mitigates the risk of employees engaging in transactions that could have an adverse impact on our stock price

•	a recoupment policy that allows our Company to recover compensation paid in situations of misconduct requiring a restatement of financial results

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•	the program does not emphasize stock options; instead, it balances stock options and full-value awards and, for the CEO and other senior executives, 75% of the equity awards that were granted in February 2012 are performance-based

•	the program does not provide for highly leveraged performance-vested awards; instead, the leverage is reasonable and is capped at 200% of target on the upside for the performance-vested RSUs and limited to 100% of target for the performance-vested stock options

•	the program sets specific stock price hurdles which are measured as the 40-day average stock price at any point over the 3-year performance period

•	there is no immediate payment; instead, the various equity awards vest in or over a 3-year period

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Portfolio Risk Management Committee—This committee establishes company-wide credit policy for all segments of our business. It implements specific underwriting procedures and limits for our Company and allocates underwriting capacity among our subsidiaries. The Portfolio Risk Management Committee focuses on measuring and managing credit, market and liquidity risk for the overall company. All transactions in new asset classes or new jurisdictions must be approved by this committee.

•	U.S. Management Committee—This committee establishes strategic policy and reviews the implementation of strategic initiatives and general business progress in the U.S. The U.S. Management Committee approves risk policy at the U.S. operating company level.

•	Risk Management Committees—The risk management committees for our U.S., U.K. and Bermuda businesses conduct an in-depth review of the insured portfolios of the relevant subsidiaries, focusing on varying portions of the portfolio at each meeting. They assign internal ratings of the insured transactions and review sector reports, monthly product line surveillance reports and compliance reports.

•	Workout Committee—This committee receives reports on transactions that might benefit from active loss mitigation and develops loss mitigation strategies for such transactions.

•	Reserve Committees—Oversight of reserving risk is vested in reserve committees for our U.S., U.K. and Bermuda businesses. The committees review the reserve methodology and assumptions for each major asset class or significant below-investment grade transaction, as well as the loss projection scenarios used and the probability weights assigned to those scenarios.

•	Reviews the qualifications of potential nominees to determine whether they might be a good candidate for membership on the Board of Directors

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•	Reviews the potential nominee's judgment, experience, independence, understanding of our business or other related industries and such other factors as it determines are relevant in light of the needs of the Board of Directors and our Company

•	Selects qualified candidates and reviews its recommendations with the Board of Directors, which will decide whether to nominate the person for election to the Board of Directors at an annual general meeting. Between annual general meetings, the Board, upon the recommendation of the Nominating and Governance Committee, can approve additions to the Board

•	the shareholder's name as it appears in AGL's books

•	a representation that the shareholder is a record holder of AGL's shares and intends to appear in person or by proxy at the meeting to present such proposal

•	the class and number of shares beneficially owned by the shareholder

•	the name and address of any person to be nominated

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•	a description of all arrangements or understandings between the shareholder and each nominee and any other person or persons, naming such other person or persons, pursuant to which the nomination or nominations are to be made by the shareholder

•	such other information regarding each nominee proposed by such shareholder as would be required to be included in a proxy statement filed pursuant to the SEC's proxy regulations

•	the consent of each nominee to serve as a director of AGL, if so elected

•	disclosed in director and officer questionnaires (which must also be completed by nominees for director) or in certifications of Code of Conduct compliance

•	reported directly by the related person or by another employee of our Company

•	reported by our Chief Financial Officer based on a list of directors, executive officers and known 5% shareholders

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(1)	The reporting person has the right to vote (but not dispose of) the Common Shares listed under "Unvested Restricted Common Shares."

(2)

The Common Shares associated with restricted share units are not deliverable as of March 15, 2013 or within 60 days of March 15, 2013 and therefore cannot be voted or disposed of within such time period. As a result, these shares are not considered beneficially owned under SEC rules. We include them in the table above, however, because we view them as an integral part of share ownership by our directors and executive officers. Each current non-management director, other than Mr. Ross and Ms. Howard, holds share units, including dividend accruals, which have vested and will be generally deferred at least six months after the termination of such director's service on the Board. Our executive officers have restricted share units that vest on specified anniversaries of the date of the award, with Common Shares delivered upon vesting.

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(3)	Represents Common Shares which the reporting person has the right to acquire as of March 15, 2013 or within 60 days of March 15, 2013 pursuant to options.

(4)	Includes shares owned by Mr. Frederico's spouse and daughter, and shares owned by a family trust, over which Mr. Frederico has the power to direct the voting and disposition.

(5)	Includes shares owned jointly with Mr. Mills's spouse over which Mr. Mills has the power to direct the voting and disposition.

(6)	Includes shares held by funds affiliated with Mr. Ross.

(1)

Based on a Schedule 13D/A filed by WL Ross Group, L.P. on December 5, 2011 reporting the amount of securities beneficially owned as of December 1, 2011. WL Ross Group, L.P., as the managing member of the general partner of each of WLR Recovery Fund IV, L.P., WLR Recovery Fund III, L.P., WLR/GS Master Co-Investment, L.P. and WLR AGO Co-Invest, L.P. (collectively, the Principal Funds), and the entity party to that certain Parallel Investment Agreement with the general partner of WLR IV Parallel ESC, L.P. (the ESC and together with the Principal Funds, the Funds), may be deemed to have shared voting and shared dispositive power over 19,835,370 shares held directly by the Funds. Wilbur L. Ross, Jr. has sole voting and sole dispositive power of 23,969 shares and, in his capacity as managing member of the general partner of WL Ross Group, L.P., may be deemed to have shared voting and shared dispositive power over the 19,835,370 shares held directly by the Funds.

(2)	Based on a Schedule 13G/A filed by Wellington Management Company, LLP on February 14, 2013, reporting the amount of securities beneficially owned as of December 31, 2012. Wellington Management Company, LLP has shared voting power over 15,209,989 shares and shared dispositive power over 16,667,531 shares.

(3)	Based on a Schedule 13G/A filed by FMR LLC on February 14, 2013, reporting the amount of securities beneficially owned as of December 31, 2012. FMR LLC has sole power to vote over 237,000 shares and sole dispositive power over 12,260,094 shares.

(4)	Based on a Schedule 13G filed by T. Rowe Price Associates, Inc. on February 12, 2013 reporting the amount of securities beneficially owned as of December 31, 2012. T. Rowe Price Associates has sole power to vote over 1,535,771 shares and sole dispositive power over 10,195,871 shares.

(5)	Based on a Schedule 13G filed by Fine Capital Partners, L.P. on February 14, 2013 reporting the amount of securities beneficially owned as of December 31, 2012. Fine Capital Partners has shared voting power and shared dispositive power over 13,440,649 shares.

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•	Enhance the performance motivation of our named executive officers (whom we refer to as executive officers), by more directly linking equity compensation awards to the price of our Common Shares, requiring share price hurdles to be achieved prior to vesting and providing for possible increased compensation if hurdles above a target level are attained

•	Enhance focus on performance-based compensation by lowering non-performance-based compensation such as perquisites

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Provide incentive for certain of our executive officers nearing retirement at age 65 to continue their efforts with our Company by making new equity grants not forfeitable if the executive retires after attaining age 65, performs 10 years of service for our Company and obtains the consent of our Compensation Committee at the time of retirement. Currently, this provision only affects our Chief Operating Officer

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(1)	For awards granted beginning in February 2012

•	$19.02, which was the highest 40-day average share price as of March 20, 2013. (Under the terms of the performance-based equity, at $18, 35% of the PSUs and 35% of the performance stock options vest at the end of three years.)

•	$24 (100% of the PSUs and 50% of the performance stock options vest at the end of three years)

•	$30 (200% of the PSUs and 100% of the performance stock options vest at the end of three years)

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•	Reviews and approves the metrics and goals in our performance framework and the executive officer performance goals for the next upcoming year in November

•	Reviews corporate performance during the then current year, as well as progress against the executive officer performance goals, in August and November

•	Makes executive compensation decisions with respect to the previous year's performance in February

•	Discusses with the full Board the full-year financial and strategic performance at length, seeking to understand what was accomplished relative to established objectives, how it was accomplished, the quality of the financial results, and strategic positioning for future competitive advantage, and the CEO's and other executive officers' individual performance

•	In conjunction with our independent directors, determines the total compensation amount for the CEO and each of the other executive officers, starting with the prior years' compensation, and making adjustments based on:

◦	Performance assessments

◦	Market pay levels and trends

◦	Input from Cook

◦	For the other executive officers: the CEO's recommendations, succession planning, and retention considerations

◦	The strength of the executive team in this unique segment of the insurance industry

•	Approves any design changes to the executive compensation program for the upcoming year

•	Routine changes to benefit plans

•	New-hire packages for non-executive officers with expected annual compensation below a specified amount

•	New-hire equity grants for non-executive officers up to a specified amount of stock options and restricted stock for each new hire. All equity grants authorized by the CEO must be reported to the Compensation Committee at its next meeting

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•	Routine salary and employment termination arrangements for employees below the top three levels of our Company

•	The performance of our Company

•	Achievement of identified objectives in the officer's areas of responsibility that are intended to achieve our Company's goals

•	Quick and effective responses to unanticipated opportunities or challenges

•	Cooperation as a team to achieve our Company's goals

•	Demonstration of ethical behavior in compliance with current legal and regulatory standards

•	We produced strong financial results, including strong operating income of $535.5 million and growth in operating shareholders' equity per share to a record level of $30.05. Shareholders' equity per share increased 1% over 2011 and operating shareholders' equity per share increased 5%. This result was achieved despite incurring a pre-tax loss of $189 million on our exposure to Greek bonds.

•	We repurchased 2.1 million Common Shares at an average price of $11.76.

•	Our share price was $14.23 at year end 2012, 8.3% higher than the 2011 year end share price of $13.14.

•	We doubled our quarterly dividend to $0.09 per share in the first quarter of 2012 and further raised it to $0.10 per share in the first quarter of 2013, for a total increase of 122%.

•	We derived $401 million of future premium revenues, through $210 million of present value of new business production (which we refer to as PVP) and $191 million from the reassumption of ceded reinsurance; the economic benefit of these transactions constituted approximately 89% of our 2012 goal.

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Through December 31, 2012, we have caused providers of representations and warranties (R&W) in residential mortgage-backed security (RMBS) transactions we insured to pay or agree to pay approximately $2.9 billion in respect of their R&W liabilities. Of this, $2.3 billion constituted payments made or to be made directly to us pursuant to agreements (e.g., the one with Deutsche Bank AG and one with another seller of mortgage loans) and approximately $557 million consisted of amounts paid according to the priority of payments in the transaction documents.

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•	AGM's lawsuit against Flagstar Bank went to trial in 2012, and in February 2013, the court granted judgment in our favor for our claims for breach of contract in the amount of approximately $90 million plus contractual interest and attorneys' fees and costs to be determined.

•	We continued to mitigate our losses in the RMBS and other sectors by purchasing securities that we have insured. We purchased $396 million of bonds we had insured, at an average cost of 63% of par, which created approximately $250 million of economic value.

•	We mutually agreed with beneficiaries to terminate policies totaling $4.1 billion of net par outstanding, while collecting 96% of expected premiums. We targeted investment grade securities for which claims are not expected but which carry a disproportionate rating agency capital charge.

•	We created underlying value by lowering our insured leverage (which is the ratio of statutory-basis net par outstanding to qualified statutory capital) by 12% year over year.

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At the time the performance goals were established, there was substantial uncertainty over the financial strength ratings of AGM, AGC and their respective insurance subsidiaries. Such ratings were on CreditWatch negative by Standard & Poor's Ratings Services (S&P) and the outlook on such ratings was negative by Moody's Investors Service, Inc. (Moody's). S&P in fact downgraded the financial strength ratings of AGM and AGC to AA- from AA+ in November 2011.

•	The volume of new issuance in the municipal market had declined steeply in 2011 as compared to 2010.

•	We anticipated issuing between 11,605,500 and 13,636,500 Common Shares in 2012 in connection with forward purchase contracts that were part of the equity units we issued in June 2009.

•	Our earnings were expected to decline due to the rapid amortization of our structured finance par outstanding and the relatively low volume of new business being underwritten.

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(1)	Amounts have not been adjusted to reflect our Company's adoption, effective January 1, 2012, of new accounting guidance on acquisition costs.

(2)	Amounts exclude income and expenses from ceding commissions, deferred costs and certain other charges.

(1)	Amounts exclude income and expenses from ceding commissions, deferred costs and certain other charges.

•	We produced strong operating income and record growth in operating shareholders' equity per share. This result was achieved despite the losses we paid on our Greek sovereign exposure.

•	Per share amounts were affected by our issuance of 13.4 million Common Shares to settle forward purchase contracts that constituted a portion of our 2009 equity units. The impact of such issuance was partially offset by the our repurchase of 2.1 million Common Shares.

•	Operating expenses were better than the 2012 goal by approximately $14 million and slightly better than 2011 actual expenses.

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PVP was below target primarily due to the low interest rate environment, tight credit spreads and the ratings uncertainty caused by the March 2012 decision of Moody's to place our financial strength ratings, including those of AGM, AGC and AG Re, on watch for possible downgrade. Moody's did not complete its review until January 2013, when it lowered the financial strength ratings of AGM and AGC from Aa3 to A2 and A3, respectively, and that of AG Re from A1 to Baa1. In addition, global economic uncertainty persists and recovery in the structured and infrastructure finance markets has been delayed.

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•	The aggregate equity award covers a period of two years in order to motivate Mr. Frederico to remain with our Company. Accordingly, Mr. Frederico did not receive an equity award in February 2013 and the Compensation Committee does not intend to consider him for another equity award until February 2014

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The two-year incentive was comprised of performance-based and time-based equity, contemplating an aggregate target value of $5 million: 50% in the form of PSUs, 25% in the form of performance stock options and 25% in the form of RSUs. The performance-based equity does not vest at all unless a minimum share price is achieved and the remaining portion of the equity does not vest until the end of three years

•	If Mr. Frederico, who is 60 years old, were to retire before February 9, 2015, the third anniversary of the grant date, all of the PSUs, the performance stock options and the RSUs would be forfeited; previously, under the terms of Mr. Frederico's employment agreement, equity awards would have continued to vest after retirement

•	The cash payable with respect to the PRP awards are contingent on future financial performance over two, three and four-year performance periods

(1)	In February 2013, the Compensation Committee increased Mr. Frederico's base salary for 2013 to $950,000.

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(1)	Summary Compensation Table Reported Value includes all elements of compensation as reported in the Summary Compensation Table pursuant to SEC rules, including the grant date value of equity awards granted in February 2012 (which constituted a two-year grant for 2011 and 2012), in February 2011 for 2010 performance and in February 2010 for 2009 performance.

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(2)	Actual Realized Value represents compensation actually received by our CEO during the year, as reported on his Form W-2 for each of the years shown. Includes restricted stock vesting during the respective calendar years and would include the net spread on option exercises. Our CEO has not exercised any options he has received from our Company.

(1)	Summary Compensation Table Reported Value represents the grant date value of restricted stock awards and restricted share unit awards granted in February 2012 (which constituted a two-year grant for 2011 and 2012), in February 2011 for 2010 performance and in February 2010 for 2009 performance.

(2)	Represents compensation actually received by our CEO during the applicable year, as reported on his Form W-2 for each of the years shown. Consists of the market value at vesting of previously granted shares that vested during the applicable year. Excludes the value of new/unvested restricted stock and restricted share unit awards that will not actually be received until a later date.

(1)	Summary Compensation Table Reported Value represents the grant date value of stock option awards granted in February 2012 (which constituted a two-year grant for 2011 and 2012), in February 2011 for 2010 performance and in February 2010 for 2009 performance.

(2)	Represents compensation actually received by our CEO during the applicable year, as reported on his Form W-2 for each of the years shown. Excludes the value of new/unvested/unexercised stock options.

•	The performance of our Company

•	Achievement of identified objectives in the executive officer's areas of responsibility that are intended to achieve our Company's goals

•	Quick and effective responses to unanticipated opportunities or challenges

•	Cooperation as a team to achieve our Company's goals

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•	Demonstration of ethical behavior in compliance with current legal and regulatory standards

•	Articulated a clear strategy and led effective implementation of business plan to grow direct business and maintain reinsurance business.

◦

Underwrote new business. Mr. Frederico was credited with continuing to write new business in an unfavorable business environment, achieving $210.0 million of PVP in 2012. Despite ratings uncertainty and unprecedented low interest rates and tight credit spreads, we insured 1,770 new issuances and secondary market positions in the U.S. public finance market, representing $14.5 billion in par sold. For issuances with single-A underlying credit quality, which is our principal target market, we guaranteed 30% of the number of transactions sold and 12% of the related par. In the structured finance sector, we guaranteed $620 million of par, which contributed $43 million of PVP.

◦	Executed reassumption transactions. Under Mr. Frederico's leadership, we canceled ceded reinsurance with Radian and Tokio for total economic benefit of $191 million.

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Developed plan to increase insurance penetration.  Mr. Frederico oversaw our purchase of Municipal and Infrastructure Assurance Corporation, which we have renamed Municipal Assurance Corp. (MAC), from Radian and our development of a plan to launch MAC as a new financial guaranty insurer that provides insurance only on debt obligations in the U.S. public finance markets, in order to increase our insurance penetration in such market.

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Actively managed potential loss transactions, including aggressive pursuit of RMBS R&W collections and servicing transfers.  Mr. Frederico led our Company in developing effective risk remediation strategies to lower losses, including recovery litigation and settlements, pursuing additional mortgage repurchases, completing servicing transfers, terminating exposures on structured finance risks, and purchasing insured securities. We have also been active in mitigating losses on public finance exposures, including in respect of Harrisburg, Pennsylvania and Jefferson County, Alabama.

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Executed settlement agreements. Mr. Frederico was responsible for our Company entering into settlement agreements, including an agreement with Deutsche Bank AG that provided for a cash payment of $166 million upon signing and for loss sharing arrangements covering future losses related to RMBS transactions that we have insured, as to which Deutsche Bank has placed approximately $278 million of eligible assets in trust in order to collateralize the loss sharing obligations, as well as one other agreement.

◦	Brought litigation proceedings. Under Mr. Frederico's leadership, we brought cases against affiliates of Deutsche Bank AG, JPMorgan Chase & Co., UBS and Credit Suisse Securities (USA) LLC to enforce our rights from the breach of R&W. We also filed a complaint against OneWest Bank, FSB, for failure to properly service mortgage loans.

◦

Completed Flagstar Trial. Mr. Frederico had oversight over our lawsuit against Flagstar Bank, FSB, which went to trial in 2012. In February 2013, the judge in the U.S. District Court for the Southern District of New York granted judgment in our favor on our claims for breach of contract in the amount of approximately $90 million plus contractual interest and attorneys' fees and costs to be determined.

◦	Transferred servicing on transactions. As a result of the efforts of Mr. Frederico and our management, at February 28, 2013, the servicing of approximately $3 billion of mortgage loans had been transferred to a new servicer and another $1.7 billion of mortgage loans were subject to special servicing arrangements.

•	Maintained strong financial strength ratings.  Although Moody's downgraded the financial strength ratings of AGM, AGC, AG Re and their respective insurance subsidiaries in January 2013, the Compensation Committee recognized that Mr. Frederico took appropriate steps to address the ratings

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Ensure that we have comprehensive, best-practice risk management with respect to all our activities, particularly the credit quality of risks insured and enterprise management. Under Mr. Frederico's leadership, despite the obstacles we faced in writing new business, we continue to maintain our underwriting discipline. The average rating of our net portfolio remains strong at A+, and new business written in the public finance, infrastructure and structured finance sectors is high quality. In addition, in 2012, we faced no anticipated risk issues or any significant compliance issues. We have been accepted by the U.K. Financial Services Authority into a pre-application process for the European Union's Solvency II Directive and have begun the process to apply for approval of a methodology to calculate our solvency capital requirement.

•	Attract and retain top quality senior management. Under Mr. Frederico's leadership, there has been limited management turnover and we have hired additional staff in order to pursue opportunities in the U.S. public finance market.

•

Mr. Michener was responsible for managing a number of litigation matters, both in respect of our RMBS claims and our exposures to Harrisburg, Pennsylvania, Jefferson County, Alabama and Stockton, California. In particular, Mr. Michener managed AGM's lawsuit against Flagstar Bank, in which the court granted judgment in favor of AGM on its claims for breach of contract in the amount of approximately $90 million plus contractual interest and attorneys' fees and costs to be determined.

•	Mr. Michener oversaw the documentation for our Company's agreement with Deutsche Bank AG.

•	Mr. Michener was instrumental in developing a plan to launch MAC as a new financial guaranty insurer that provides insurance only on debt obligations in the U.S. public finance markets.

•	Mr. Michener obtained the approval of the New York Department of Financial Services for AGM and its subsidiary, Assured Guaranty Municipal Insurance Company, to release approximately $700 million of contingency reserves, based on the expiration of exposure, which increases the financial flexibility of AG Re and the liquidity of AGL.

•

Mr. Mills has oversight responsibility for our RMBS servicing efforts, in which we seek to mitigate RMBS losses by influencing mortgage servicing, including, if possible, causing the transfer of servicing or establishing special servicing arrangements. As a result of our Company’s efforts, at February 28, 2013, the servicing of approximately $3.0 billion of mortgage loans had been transferred to a new servicer and another $1.7 billion of mortgage loans were subject to special servicing arrangements.

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•	Mr. Mills managed our purchase of attractively priced below investment grade obligations that we insure in order to mitigate losses as well as improve our excess capital position and increase future investment income. In 2012, we purchased $396 million of bonds, bringing total securities purchased for loss mitigation purposes held in our investment accounts to $1,844 million of par.

•	Mr. Mills played a principal role in our negotiation and execution of two settlement agreements during the year relating to our claims for breaches of R&W in RMBS transactions that we had insured, one with Deutsche Bank AG and one with another seller of mortgage loans.

•	Mr. Mills is overseeing the development of a business to provide third-party consulting services in respect of RBMS servicing.

•	Mr. Bailenson was instrumental in developing a plan to launch MAC as a new financial guaranty insurer that provides insurance only on debt obligations in the U.S. public finance markets.

•	Mr. Bailenson led the negotiation of our Company's $435 million excess of loss reinsurance facility, entered into in 2012, which provided us with additional rating agency capital credit.

•	Mr. Bailenson oversaw the filing of our financial statements in a timely manner and the resolution of all comment letters from SEC staff.

•	Mr. Brewer played a critical role in our discussions with the rating agencies over our financial strength ratings.

•	Mr. Brewer chaired our U.S. Risk Management Committee and led the surveillance of our insured portfolio.

•	Mr. Brewer was responsible for providing all credit performance data for our reserve committees.

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(1)	In February 2013, the Compensation Committee increased Mr. Michener's base salary for 2013 to $475,000, Mr. Bailenson's base salary for 2013 to $450,000 and Mr. Brewer's base salary for 2013 to $370,000. The base salary for Mr. Mills did not change.

(2)	Amounts reflect the Compensation Committee's target value of performance-based equity and the time-based equity granted. See pages 41 to 42 above for additional detail.

•	The principal amount granted is divided into three installments

•	For the relevant installment, the portion of principal associated with such installment and the performance period relating to such installment, are set out in the terms of the award

•	The change in the ABV per share for the relevant performance period is determined

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•	The operating ROE for the relevant performance period is determined

•	The sum of 50% of the change in the ABV per share and of 50% of the operating ROE is calculated

•	The award payment for each installment is the product of (i) the sum of 1 plus 50% of the percentage change in the ABV per share plus 50% of the operating ROE multiplied by (ii) the portion of principal associated with the installment multiplied by (iii) the principal amount granted

(1)	Mr. Brewer has vested in only 25% of his 2010 and 2011 grants. Mr Brewer did not receive a 2009 grant.

•	Establishing executive compensation policies

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•	Determining the compensation of our CEO

•	Reviewing our CEO's compensation recommendations regarding other senior officers and determining appropriate compensation for such officers

•	its independence

•	that Cook undertook no work with or for our management during the past year that was not approved in writing by the Chairman of the Board of Directors

•	that Cook will undertake no work with or for our management, other than work they perform for us on matters under our purview and control and related to our charter

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•

If an executive officer engages in misconduct related to a restatement of our financial results, then the Compensation Committee may rescind the officer's option exercises that occurred within 12 months after the restated period, and also recoup the amount of cash bonus payments to the officer in excess of the amount that would have been paid if the correct financial results had been known to the Compensation Committee at the time of the original bonus award.

•

If an executive officer receives incentive compensation based on achievement of a level of objectively quantifiable performance goals, and the level of achievement of those goals is later determined to have been overstated, the Compensation Committee may recoup the amount of any payment in excess of the amount that would have been paid if the correct level of performance had been known. The PRP is an example of an arrangement that requires achievement of objectively quantifiable performance goals.

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•

Following the executive officer's involuntary termination without cause or voluntary termination for good reason and subject to the executive signing a release of claims, the executive will receive a lump-sum payment in an amount equal to one year's salary plus his average bonus amount over the preceding 3-year period, plus a pro-rata bonus for the year of termination and an amount equal to one year of medical and dental premiums.

•	The executive officer's receipt of severance benefits is subject to his compliance with non-competition, non-solicitation, and confidentiality restrictions during his employment and for a period of one year following termination of employment.

•	All long-term incentive awards granted after April 2011 require employment termination (double-trigger) following a change in control before these awards will vest

•	Such awards will vest upon a change in control if the acquirer does not assume the awards

•	We no longer provide excise tax reimbursements and gross-up payments in the case of a change in control

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(1)	Payment for bonuses for 2012, 2011 and 2010 were made in 2013, 2012 and 2011, respectively.

(2)	This column represents the grant date value of restricted stock awards and restricted share unit awards granted in 2012, 2011 and 2010 for 2011, 2010 and 2009 performance, respectively. For our CEO, the awards granted in 2012 constituted a two-year grant and he did not receive any award in 2013.

(3)	No options were granted in 2011. This column represents the grant date value of stock option awards granted in 2012 and 2010 for 2011 and 2009 performance, respectively. For our CEO, the awards granted in 2012 constituted a two-year grant and he did not receive any award in 2013.

(4)	This column represents the vesting date value of PRP awards granted in 2007, 2008, 2009, 2010 and 2011 that vested on December 31, 2012, December 31, 2011 and December 31, 2010 and were paid in March 2013, 2012 and 2011, respectively.

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(5)	All other compensation consists of the benefits set forth in the table below.

•	The Bermuda housing tax gross-up and FICA paid by employer identified for 2011 are only through April 2011, at which time affected executive officers waived their rights to such gross-ups.

•	In connection with the termination of the executive officers' employment agreements, the executive officers waived their U.S. club fees and the executive health benefit.

(6)	As further discussed in "Compensation Discussion and Analysis", equity awards granted to our CEO in 2012 constituted a two-year grant and he did not receive any equity awards in 2013.

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•	The indemnification agreements provide for indemnification arising out of specified indemnifiable events, such as events relating to the fact that the indemnitee is or was one of our directors or officers or is or was a director, officer, employee or agent of another entity at our request or relating to anything done or not done by the indemnitee in such a capacity.

•	The indemnification agreements provide for advancement of expenses.

•	These agreements provide for mandatory indemnification to the extent an indemnitee is successful on the merits. To the extent that indemnification is unavailable, the agreements provide for contribution.

•	The indemnification agreements set forth procedures relating to indemnification claims.

•	The agreements also provide for maintenance of directors' and officers' liability insurance.

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(1)

This column represents a PRP award that vests 25% after a two year performance period; 25% after a three year performance period and 50% after a four year performance period. Awards will increase or decrease in value based 50% on the change in our ABV per share, as defined, and 50% on our operating ROE, over each performance period. For the executive officers, no amount is payable if the growth in our ABV per share for the applicable performance period is negative and if our operating ROE is not at least 3% on average for each year in the applicable performance period. However, if, in a subsequent performance period, there is either positive growth in our ABV per share or our operating ROE is at least 3% on average for each year in the applicable performance period, and the executive officer remains employed at our Company, then the executive officer will receive the forfeited payment.

(2)

Represents a PSU award.  The PSUs will vest at the end of a three-year vesting period based on performance during such period based on the highest 40-day average share price during such period as described above and continued employment through the end of the applicable three-year period, with limited exceptions.  The number of PSUs listed in the Threshold column represents the number of PSUs which shall become vested based on achievement of 35% of the performance target (a 40-day average share price of $18 during the performance period); the number of PSUs listed in the Target column represents the number of PSUs which shall become vested based on achievement of 100% of the performance target (a 40-day average share price of $24 during the performance period); and the number of PSUs listed in the Maximum column represents the number of PSUs which shall become vested based on achievement of 200% of the performance target (a 40-

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(3)	Represents a time-based RSU award. Restrictions lapse on the third anniversary of the grant date of the award, subject to continued employment.

(4)

Represents a performance stock option award.  The option will vest at the end of a three-year vesting period based on performance during such period based on the highest 40-day average share price during such period as described above and continued employment through the end of the applicable three-year period, with limited exceptions.  The number of shares listed in the Threshold column represents the right to purchase the number of shares subject to the option which shall become vested based on achievement of 35% of the performance target (a 40-day average share price of $18 during the performance period); and the number of shares listed in the Target column represent right to purchase the number of shares subject to the option which shall become vested based on achievement of 100% of the performance target (a 40-day average share price of $30 during the performance period).  Because vesting for the option cannot exceed 100%, no shares are listed in the Maximum column.  If at least 35% of the performance target is not achieved during the performance period, the right to purchase all of the shares subject to the option shall be forfeited.

(5)

This column discloses the aggregate grant date fair market value computed in accordance with U.S. GAAP, which is $27.35 per target share for PSUs, $17.44 per share for RSUs, and $7.84 per target share for performance stock options. For all assumptions used in the valuation, see note 20 to our consolidated financial statements included in our Annual Report on Form 10-K for the year ended December 31, 2012.

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(1)	These options vested on February 24, 2013.

(2)	These options will vest on February 9, 2015, subject to continued employment and achievement of performance goals, as defined.

(3)	These units vested on February 5, 2013.

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(4)	One half of these units vested on February 24, 2013 and one half of these units will vest on February 24, 2014, subject to continued employment or agreement terms relating to retirement.

(5)	One third of these units vested on February 9, 2013 and one third of these units will vest on each of February 9, 2014 and 2015, subject to continued employment or agreement terms relating to retirement.

(6)	These units will vest on February 9, 2015, subject to continued employment.

(7)	These units will vest on February 9, 2015, subject to continued employment and achievement of performance goals, as defined.

(1)	This column represents gross shares vesting, not reduced by shares withheld to pay for personal income tax.

(2)	The value of a restricted share upon vesting is the fair market value of the stock on the vesting date. This column represents the value of gross shares vesting, not reduced by shares withheld to pay for personal income tax.

(1)	The amounts in this column are also included in the Summary Compensation Table, in the Salary column, as follows:

(2)	The amounts in this column are included in the Summary Compensation Table, in the All Other Compensation column as the employer contribution to the retirement plans.

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(3)	Of the totals in this column, the following totals have been previously reported in the Summary Compensation Table for previous years:

(4)	$1,612,387 was assumed from the ACE Limited Supplemental Retirement Plan at our IPO.

(1)	PRP payouts may be zero if minimum performance criteria is not met in each performance period.

(2)	Mr. Bailenson had not reached retirement age by December 31, 2012. Upon retirement, Mr. Bailenson will become fully vested in respect of his unvested PRP, restricted stock and stock option awards granted prior to 2012.

(1)	No unvested PRP payments are payable upon a termination without cause.

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(1)	No unvested PRP payments are payable upon a change in control.

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•	A participant does not vest in the employer contributions until he or she has completed one year of service, but the participant will vest earlier if he or she dies or attains age 65 while employed by a specified Assured Guaranty employer.

•

Distribution of a participant's account balances will be made as a lump sum. However, a participant may elect to receive payment of his or her account balances in annual installments over a period not exceeding five years, but only if, at the time of termination, the participant has attained age 55 and completed at least five years of service, and the amount of the participant's account balances is at least $50,000.

•	A participant who is considered to be a specified employee as defined in IRC Section 409A and whose payment of benefits begins by reason of termination of employment may not begin to receive such payment until six months after termination of employment.

•	To satisfy the requirements of IRC Section 457A, U.S. taxpayers will not accrue additional benefits under the plan on and after January 1, 2009.

•	A participant does not vest in employer contributions until he or she has completed one year of service, but the participant will vest earlier if he or she dies or attains age 65 while employed by a specified Assured Guaranty employer.

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•

Distribution of a participant's account balances will be made as a lump sum. However, a participant may elect to receive payment of his or her account balances in annual installments over a period not exceeding five years, but only if, at the time of termination, the participant has attained age 55 and completed at least five years of service, and the amount of the participant's account balances is at least $50,000.

•	A participant who is considered to be a specified employee as defined in IRC Section 409A and whose payment of benefits begins by reason of termination of employment may not begin to receive such payment until six months after termination of employment.

•	Benefits that were accrued prior to January 1, 2009 that would otherwise be subject to IRC Section 457A shall be distributed in a single lump-sum payment on January 1, 2017 (to the extent not previously distributed) to satisfy the requirements of IRC Section 457A.

•

For awards granted prior to 2012, a participant generally vests in restricted stock awards over four years of continued employment and in option awards over three years of continued employment, but if a change in control occurs or if the participant terminates employment as a result of death or disability, then the participant immediately vests in any outstanding awards. For awards granted prior to 2012, in the event of retirement, prior equity grants to an executive officer will continue to vest and options will be exercisable for their original term.

•

For PSUs and performance stock options granted in 2012 and 2013, the participant will vest at the end of a three-year vesting period based on performance during such period based on the highest 40-day average share price during such period as described above and the continued employment of the participant through the end of such three-year period with limited exceptions as described below. For such awards, the participant is entitled to pro-rata vesting in the event of termination prior to the end of the vesting period due to death or disability, an involuntary termination without cause, a voluntary termination for good reason or, for awards granted in 2013, a voluntary termination due to retirement, if certain requirements are met and if, and only to the extent that, the performance conditions are satisfied at the end of the applicable performance period. In the event of a change in control, the PSUs and options vest only to the extent that the performance conditions are satisfied at the time of the change in control and only if the participant remains employed through the end of the three-year vesting period, provided, however that the vesting of the PSUs and performance stock options shall be accelerated following such change in control in the event of termination following the change in control but prior to the end of the vesting period due to death or disability, an involuntary termination without cause, a voluntary termination for good reason or in the event that the acquirer does not agree to continue such award following the change in control.

•

For RSUs granted in 2012 and 2013, the participant will vest at the end of a three-year vesting period if the participant remains employed through the end of such period. Such vesting may be accelerated in the event of termination prior to the end of the vesting period due to death or disability or in the event of a change in control where the acquirer does not agree to continue such award following the change in control. Additionally, the participant may remain entitled to continued vesting of such RSUs following an involuntary termination without cause, a voluntary termination for

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•	the auditor's judgments about the quality, not just the acceptability, of our Company's accounting principles as applied in its financial reporting;

•	methods used to account for significant unusual transactions;

•	the effect of significant accounting policies in controversial or emerging areas for which there is a lack of authoritative guidance or consensus;

•	the process used by management in formulating particularly sensitive accounting estimates and the basis for the auditor's conclusions regarding the reasonableness of those estimates;

•	disagreements with management over the application of accounting principles, of which there were none, the basis for management's accounting estimates, and disclosures in the financial statements; and

•	any significant audit adjustments and any significant deficiencies in internal control.

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•	shares currently authorized but unissued or

•

shares purchased in the open market by one of our direct or indirect wholly-owned subsidiaries (as determined by the President, Chief Financial Officer or General Counsel of our Company). We may contribute to the subsidiary an amount sufficient to accomplish the purchase in the open market of the Common Shares to be acquired (as determined by the Chairman or any Executive Vice President of the Company).

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•	the fair market value of a Common Share on the first day of the subscription period or

•	the fair market value of a Common Share on the exercise date (or such higher price as the Compensation Committee may determine from time to time).

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•	the excess of the fair market value of the shares at the time of such disposition over the purchase price or

•	the excess of the fair market value of the shares at the date of grant over an amount equal to what the purchase price would have been if it had been computed as of the date of the grant

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(1)

Includes Common Shares to be issued upon exercise of outstanding stock options and performance stock options granted under the Assured Guaranty Ltd. 2004 Long-Term Incentive Plan. Does not include purchase rights currently accruing under the Assured Guaranty Ltd. Employee Stock Purchase Plan because the purchase price (and therefore the number of shares to be purchased) will not be determined until the end of the purchase period, which is June 30, 2013. The purchase price under such plan is generally 85% of the lower of the fair market value of a Common Share on the first day of the subscription period or on the exercise date.

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(1)	We paid audit fees, including costs, for the years ended December 31, 2012 and December 31, 2011 for professional services rendered in connection with:

•	the audits of our consolidated financial statements, of management's assessment of internal controls over financial reporting and of the effectiveness of these controls

•	the statutory and GAAP audits of various subsidiaries

•	review of quarterly financial statements

•	the restatement of our 2010 Annual Report on Form 10-K

(2)	Audit-related fees for the years ended December 31, 2012 and December 31, 2011 related to audits of the Company's employee benefit plans, review procedures in connection with the compensation disclosures in this proxy statement and compliance with requirements to provide financial statements in interactive data format using the eXtensible Business Reporting Language.

(3)	Of the total amount of tax fees for 2012, $111,092 related to tax compliance and $93,418 related to tax advice. Of the total amount of tax fees for 2011, $150,000 related to tax compliance and $24,925 related to tax advice.

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(4)	Fees related to general support for documentation preparation and review, industry knowledge and project management provided in connection with the European Union's Solvency II insurance regulatory regime.

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(a)	An employee who has been employed less than 500 hours and less than six months.

(b)	An employee whose customary employment is 20 hours or less per week.

(c)	An employee whose customary employment is for not more than five months in any calendar year.

(d)	An employee who owns, or who would own upon the exercise of any rights extended under the Plan and the exercise of any other option held by the employee (whether qualified or non-qualified), shares possessing 5% or more of the total combined voting power or value of all classes of stock of the Company or of any parent or subsidiary corporation.

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(a)	The “Purchase Price” per share shall be equal to 85% of the lesser of (i) the fair market value of Stock on the first day of the Subscription Period; or (ii) the fair market value of Stock on the Exercise Date (or such higher price as may be determined by the Committee from time to time). In no event shall the Purchase Price be less than the par value of the Stock.

(b)	A Participant shall be deemed to have elected to purchase the shares of Stock which he became entitled to purchase on the Exercise Date unless he shall notify the Company prior to the Exercise Date, or such other time as the Committee may establish, that the Participant he elects not to make such purchase.

(c)	Any accumulated payroll deductions that are not used to purchase full shares of Stock under the Plan shall be paid to the Participant without interest.

(d)

No employee shall have the right to purchase more than $25,000 in value of Stock under the Plan (and any other employee stock purchase plan described in Code section 423 and maintained by the Company or any Related Company) in any calendar year, such value being based on the fair market value of Stock as of the date on which the option to purchase the Stock is granted, as determined in accordance with subsection 2.2 of the Plan.

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(a)

The shares of Stock which may be purchased under the Plan shall be currently authorized but unissued shares, or shares purchased in the open market by a direct or indirect wholly owned subsidiary of the Company (as determined by the President, Chief Financial Officer or General Counsel of the Company). The Company may contribute to the subsidiary an amount sufficient to accomplish the purchase in the open market of the shares of Stock to be so acquired (as determined by the Chairman or any Executive Vice President of the Company).

(b)

Subject to the provisions of subsection 3.3 and the following provisions of this paragraph (b), the number of shares of Stock which may be purchased under the Plan shall not exceed 350,000 shares of Stock; provided that, contingent on approval by the Company’s shareholders at the Company’s 2013 annual meeting of the increase in the number of shares reserved for purchase as set forth below, the number of shares of Stock that may be purchased under the Plan shall not exceed 600,000 shares of Stock (which number includes all shares available for delivery under this paragraph (b) since the establishment of the Plan in 2004, determined in accordance with the terms of the Plan). To the extent not prohibited by applicable law or the applicable rules of any stock exchange, the Committee may permit participation for Subscription Periods beginning on or after January 1, 2013 and prior to the 2013 annual shareholders meeting, provided that such participation is contingent on the approval of the increase in reserved shares by the Company’s shareholders at the Company’s 2013 annual shareholders meeting.

(c)	A Participant will have no interest in shares of Stock covered by his Subscription Agreement until the shares are delivered to him.

(a)

If the Company shall effect any subdivision or consolidation of shares of Stock or other capital readjustment, payment of stock dividend, stock split, combination of shares or recapitalization or other increase or reduction of the number of shares of Stock outstanding without receiving compensation therefor in money, services or property, then, subject to the requirements of Code section 423, the Committee shall adjust the number of shares of Stock available under the Plan.

(b)

If the Company is reorganized, merged or consolidated or is party to a plan of exchange with another corporation, pursuant to which reorganization, merger, consolidation or plan of exchange the shareholders of the Company receive any shares of stock or other securities or property, or the Company shall distribute securities of another corporation to its shareholders, then, subject to the requirements of Code section 423, there shall be substituted for the shares subject to outstanding rights to purchase Stock under the Plan an appropriate number of shares of each class of stock or amount of other securities or property which were distributed to the shareholders of the Company in respect of such shares.

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(a)	Notwithstanding any other provision of the Plan, the Company shall have no liability to issue any shares of Stock under the Plan unless such delivery or distribution would comply with all applicable laws and the applicable requirements of any securities exchange or similar entity.

(b)	In the case of a Participant who is subject to Section 16(a) and 16(b) of the Securities Exchange Act of 1934, the Committee may, at any time, add such conditions and limitations with respect to such Participant as the Committee, in its sole discretion, deems necessary or desirable to comply with Section 16(a) or 16(b) and the rules and regulations thereunder or to obtain any exemption therefrom.

(c)	To the extent that the Plan provides for issuance of certificates to reflect the transfer of shares of Stock, the transfer of such shares may, at the direction of the Committee, be effected on a non-certificated basis, to the extent not prohibited by the provisions of Rule 16b-3, applicable local law, the applicable rules of any stock exchange, or any other applicable rules.

(a)

Neither a Participant nor any other person shall, by reason of the Plan, acquire any right in or title to any assets, funds or property of the Employers whatsoever, including, without limitation, any specific funds, assets, or other property which the Employers, in their sole discretion, may set aside in anticipation of a liability under the Plan. A Participant shall have only a contractual right to the amounts, if any, payable under the Plan, unsecured by any assets of the Employers. Nothing contained in the Plan shall constitute a guarantee by any of the Employers that the assets of the Employers shall be sufficient to pay any benefits to any person.

(b)

The Plan does not constitute a contract of employment, and participation in the Plan will not give any employee the right to be retained in the employ of an Employer or any Related Company, nor any right or claim to any benefit under the Plan, unless such right or claim has specifically accrued under the terms of the Plan. Except as otherwise provided in the Plan, no right to purchase shares under the Plan shall confer upon the holder thereof any right as a shareholder of the Company prior to the date on which he fulfills all service requirements and other conditions for receipt of such rights.

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(a)	Subject to the provisions of the Plan, the Committee will have the authority and discretion to establish the terms, conditions, restrictions, and other provisions applicable to the right to purchase shares of Stock under the Plan.

(b)	The Committee will have the authority and discretion to interpret the Plan, to establish, amend, and rescind any rules and regulations relating to the Plan, to determine the terms and provisions of any agreements made pursuant to the Plan, and to make all other determinations that may be necessary or advisable for the administration of the Plan.

(c)	Any interpretation of the Plan by the Committee and any decision made by it under the Plan is final and binding on all persons.

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(a)	Board. The term “Board” shall mean the Board of Directors of the Company.

(b)	Code. The term “Code” means the Internal Revenue Code of 1986, as amended. A reference to any provision of the Code shall include reference to any successor provision of the Code.

(c)	Compensation. The term “Compensation” means total compensation paid by the Employers for the applicable period specified in Section 2.2, exclusive of any bonus payment, payment in cash or kind under any stock option plan, deferred compensation plan, or other employee benefit plan or program of the Employers.

(d)	Dollars. As used in the Plan, the term “dollars” or numbers preceded by the symbol “$” shall mean amounts in United States Dollars.

(e)	Effective Date. The “Effective Date” shall be the date on which the Plan is adopted by the Board.

(f)	Employer. The Company and each Related Company which, with the consent of the Company, adopts the Plan for the benefit of its eligible employees are referred to collectively as the “Employers” and individually as an “Employer”.

(g)	Fair Market Value. The “Fair Market Value” of a share of Stock of the Company as of any date shall be the closing market composite price for such Stock as reported for the New York Stock Exchange - Composite Transactions on that date or, if Stock is not traded on that date, on the next preceding date on which Stock was traded.

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(h)	Participant. The term “Participant” means any employee of the Company who is eligible and elects to participate pursuant to the provisions of Section 2.

(i)	Related Companies. The term “Related Company” means any company during any period in which it is a “subsidiary corporation” (as that term is defined in Code section 424(f)) with respect to the Company.

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