ASSURED GUARANTY LTD

12. Employee Benefit Plans

Share-based compensation expense is based on the grant date fair value using the grant date closing price or the Monte Carlo or Black-Scholes-Merton (Black-Scholes) pricing models. The Company amortizes the fair value of share-based awards on a straight-line basis over the applicable service periods of the awards.

The fair value of each award under the Assured Guaranty Ltd. Employee Stock Purchase Plan is estimated at the beginning of the offering period using the Black-Scholes option valuation model and is expensed over the period which the employee participates in the plan and pays for the shares.

Assured Guaranty Ltd. Long-Term Incentive Plan

The Company maintains the Assured Guaranty Ltd. 2024 Long-Term Incentive Plan (the Incentive Plan), which is the successor plan to the Assured Guaranty Ltd. 2004 Long-Term Incentive Plan (the Prior Plan). The number of AGL common shares that may be delivered under the Incentive Plan include (i)1,750,000 shares; plus (ii) any shares that were granted under the Prior Plan that are forfeited, expire or are cancelled without delivery of shares or which result in the forfeiture of the shares back to the Company to the extent that such shares would have been added back to the reserve under the terms of the Prior Plan. As of December 31, 2025,1,417,452 common shares were available to grant under the Incentive Plan. In the event of certain transactions affecting AGL’s common shares, the number or type of shares subject to the Incentive Plan, the number and type of shares subject to outstanding awards under the Incentive Plan, and the exercise price of awards under the Incentive Plan, may be adjusted.

The Incentive Plan provides for the grant of full value awards, which may be granted in return for a participant's previously performed services, or in return for the participant surrendering other compensation that may be due, or may be contingent on the achievement of performance or other objectives during a specified period. The grant of full value awards are subject to a risk of forfeiture or other restrictions that will lapse upon the achievement of one or more goals relating to completion of service by the participant or achievement of performance or other objectives. In addition to full value awards, the Incentive Plan also provides for the grant of incentive stock options, non-qualified stock options and stock appreciation rights.

The Incentive Plan is administered by the Compensation Committee of AGL’s Board, except as otherwise determined by the Board. The Board may amend or terminate the Incentive Plan. The Company issues new shares to settle share-based awards.

Restricted Share Units

Restricted share units are valued based on the closing price of the underlying shares at the date of grant. These restricted share units generally vest pro rata over afour-year period or all at once after athree-year period. The shares are delivered on the vesting date.

Restricted Share Unit Activity

As of December 31, 2025, the total unrecognized compensation cost related to outstanding non-vested restricted share units was $19 million, which the Company expects to recognize over the weighted average remaining service period of 2.1 years. The total value of restricted share units vested during the years ended December 31, 2025, 2024 and 2023 was based on grant date fair value and was $21 million, $16 million and $18 million, respectively. The weighted average grant-date fair value per share of restricted share units granted during the years ended December 31, 2025, 2024 and 2023 was $91.53, $84.59 and $61.26, respectively.

Performance-Based Restricted Share Units

Each performance-based restricted share unit represents a contingent right to receive up to a certain number of the Company’s common shares. Awards tied to core adjusted book value (ABV) per share represent the right to receive up totwo shares at the end of athree-year performance period, depending on the growth in core ABV per share over thethree-year performance period. Performance-based restricted share units tied to total shareholder return (TSR) relative to the TSR of the 55th percentile of the Russell Midcap Index - Financials (Index) represent the right to receive up to 2.5 shares at the end of athree-year performance period. The shares related to awards tied to core ABV per share are delivered on the vesting date and the shares related to awards tied to relative TSR are generally delivered on the fourth anniversary of the grant date.

Performance-Based Restricted Share Unit Activity

(1) Includes 73,867 ABV performance-based restricted share units and 83,987 TSR performance-based restricted share units that were granted prior to 2025 at a weighted average grant date fair value of $56.69 and $83.97, respectively, but met performance hurdles and vested during 2025. The weighted average grant date fair value per share excludes these shares.

(2) Excludes 157,854 TSR performance-based restricted share units that vested during 2025 but were not delivered.

(3) Excludes 63,004 performance-based restricted share units that have met performance hurdles and vest in February 2026. Includes 157,854 TSR performance-based restricted share units that vested during 2025 but will be delivered in 2026.

As of December 31, 2025, the total unrecognized compensation cost related to outstanding non-vested performance-based share units was $24 million, which the Company expects to recognize over the weighted average remaining service period of 1.8 years. The total value of performance-based restricted share units vested during the years ended December 31, 2025, 2024 and 2023 was based on grant date fair value and was $26 million, $17 million and $11 million, respectively.

For the 2025, 2024 and 2023 awards, the grant-date fair value of the performance-based restricted share units tied to relative TSR was calculated using a Monte Carlo simulation in order to determine the total return of the Company’s shares relative to the total return of financial companies in the Index. The inputs to the simulation include the beginning share price and historical share price volatility of each company in the Index as well as the historical correlation coefficient between the share price of each company in the Index and the Index itself. In addition, the simulation also uses the risk-free rate and a discount for liquidity. Because the simulation is calculating the total rate of return for each company in the Index, the simulation assumes that all dividends for all companies are reinvested. As a result, all dividends within the simulation are set to zero regardless of any actual dividends paid by any of the companies in the Index, so actual dividend data are not used as inputs.

The following are significant assumptions used in determining the fair value of the performance-based restricted share units tied to relative TSR.

For the 2025, 2024 and 2023 awards, the grant-date fair value of the performance-based restricted share units tied to core ABV was based on the grant date closing price. The weighted average grant-date fair values per share of all performance-based awards in 2025, 2024 and 2023 were $102.12, $94.56 and $71.34, respectively.

Restricted Share Awards

Restricted share awards are valued based on the closing price of the underlying shares at the date of grant. The Company awards restricted share awards to non-executive directors, and vest after one year. The shares are delivered on the vesting date.

Restricted Share Award Activity

As of December 31, 2025, the total unrecognized compensation cost related to outstanding non-vested restricted share awards was $0.7 million, which the Company expects to recognize over the weighted average remaining service period of 0.3 years. The total fair value of shares vested during the years ended December 31, 2025, 2024 and 2023 was $1.7 million, $2.0 million and $2.2 million, respectively. The weighted average grant-date fair values per share of shares granted during the years ended December 31, 2025, 2024 and 2023 was $90.18, $77.54 and $52.26, respectively.

Employee Stock Purchase Plan

The Company established the AGL Employee Stock Purchase Plan (ESPP) in accordance with Internal Revenue Code of 1986 (the Code) Section 423, and participation is available to all eligible employees. Maximum annual purchases by participants are limited to the number of whole shares that can be purchased with an amount equal to 10% of the participant's compensation or, if less, shares having a value of $25,000. Participants may purchase shares at a purchase price equal to 85% of the lesser of the fair market value of the stock on the first day or the last day of the subscription period. The Company has reserved for issuance and purchase 1,200,000 AGL common shares under the ESPP. As of December 31, 2025,303,536 common shares were available for grant under the ESPP. The Company issues new shares to settle share-based awards.

The fair value of each award under the ESPP is estimated using the following assumptions: (i) the expected dividend yield is based on the current expected annual dividend and share price on the grant date; (ii) the expected volatility is estimated at the date of grant based on the historical share price volatility, calculated on a daily basis; (iii) the risk-free rate for periods within the contractual life of the option is based on the U.S. Treasury yield curve in effect at the time of grant; and (iv) the expected life is based on the term of the offering period.

AGL Employee Stock Purchase Plan

Share-Based Compensation Expense

The following table presents share-based compensation costs and the amount of such costs that are deferred as policy acquisition costs, pre-tax. Amortization of previously deferred share compensation costs is not shown in the table below.

Share-Based Compensation Expense Summary

Defined Contribution Plan

The Company maintains a savings incentive plan, which is qualified under Section 401(a) of the Code for U.S. employees. Eligible participants may contribute a percentage of their eligible compensation subject to U.S. Internal Revenue Service (IRS) limitations. The Company’s matching contribution is an amount equal to 100% ofeach participant’s contributions up to 7%of such participant’s eligible compensation, subject to IRS limitations. Certain eligible participants may also contribute a percentage of eligible compensation over the IRS limitations to a nonqualified supplemental executive retirement plan. The Company's matching contribution in the nonqualified plan is an amount equal to 100% of each participant’s contributions up to 6% of participant’s eligible compensation above the IRS limitations for the qualified plan. The Company also makes core contributions of 7% of the participant’s eligible compensation to the qualified plan, subject to IRS limitations, regardless of whether the employee otherwise contributes to the plan, and a core contribution of 6% of the participant’s eligible compensation above the IRS limitations for the qualified plan to the nonqualified plan for eligible employees. Employees become fully vested in Company contributions to the qualified and nonqualified plans afterone year of service, as defined in the plan (or upon reaching age 65 for the nonqualified plan, if earlier). Plan eligibility is immediate upon hire. The Company also maintains similar non-qualified plans for non-U.S. employees. The Company recognized defined contribution plan expenses of $17 million, $18 million and $16 million for the years ended December 31, 2025, 2024 and 2023, respectively.

Payable to Sound Point and AHP

As of December 31, 2024, the Company had $3 million in compensation payable to former employees of AssuredIM in accordance with the Sound Point Transaction and the AHP Transaction.