Exhibit 10.16
(THE HARTFORD LOGO) [c96333c9633300.gif]
February 9, 2010
Mr. Christopher J. Swift
49 Winfield Lane
New Canaan, CT 06840
Dear Chris:
I am pleased to confirm the terms of your employment with The Hartford Financial
Services Group, Inc. (“HFSG”). The compensation outlined below conforms to the
requirements of the Troubled Asset Relief Program (“TARP”). After HFSG is no
longer subject to the TARP restrictions on executive compensation, the
Compensation Committee of the HFSG Board of Directors will, in their discretion,
reconfigure your compensation, taking into account the market practices applied
to CFOs of comparable organizations and HFSG’s business circumstances and
strategies at that time.
1. Effective Date. On or before March 1, 2010.
 
2. Position. On the Effective Date, you will begin to serve in the Tier 1
position of Executive Vice President and Chief Financial Officer of HFSG. In
that capacity, you will report directly to Liam McGee.  
3. Salary. Your initial cash salary will be $975,000 per year ($40,625 per
semi-monthly pay period).  
4. Deferred Units. In addition to your cash salary, as part of your annual
compensation, you will be eligible to accrue semi-monthly awards of Deferred
Units under The Hartford Deferred Stock Unit Plan (“Plan”) at an initial rate of
$1,525,000 per year ($63,541.67 per semi-monthly pay period). You will be
granted these awards, subject to the terms of the Plan, on a quarterly basis,
following the Company’s financial filings on SEC Forms 10-K or 10-Q. Should your
employment terminate for a reason other than cause, these awards will remain
vested and be distributed per the Plan. In the event of a for-cause termination,
vested awards would be cancelled.

 

 

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5. Annual Long-Term Award. For the 2010 year, you will receive a long-term
incentive award equal to one-third of your total compensation, pro-rated for the
2010 service period, in the form of Restricted Units under the Plan, with such
award to be made at the time that HFSG makes its long-term incentive awards to
other employees (anticipated to be late February 2010) or, if your employment
begins thereafter, in the first open window following your date of employment.
Based on an assumed start date of March 1, 2010, the annual amount of such award
would be $1,250,000, and the pro-rated amount would be $1,041,250. The award
shall be subject to the terms of the Plan and shall vest on the third
anniversary of the award date, provided that you are then employed by HFSG, and
shall be payable to you as provided in the Plan, to the extent permissible under
applicable law and U.S. Department of the Treasury regulations issued in
connection with TARP. For calendar years subsequent to 2010, you will receive
long-term incentive awards as may be determined by the Compensation Committee in
their discretion. Beginning with the 2011 grant, the Compensation Committee may
add performance criteria to the determination of your award. Should your
employment terminate for a reason other than cause, any unvested awards will be
forfeited, and vested awards will be paid out post-termination as TARP funds are
repaid. In the event of a for-cause termination, all awards, vested and
unvested, would be cancelled.
6. Benefits. Subject to the limits of this letter and the Emergency Economic
Stabilization Act of 2008, as amended by the American Recovery and Reinvestment
Act of 2009 and as such Act may be further amended, and rules, regulations and
guidance promulgated by the U.S. Department of the Treasury or any other
governmental authority thereunder (together, and as in effect from time to time,
“EESA”), you will be entitled to benefits consistent with those made available
to other senior executives of HFSG and reimbursement of reasonable relocation
and business expenses, in each case in accordance with applicable HFSG policies
as in effect from time to time..
7. Executive Compensation Standards. Any compensation paid or awarded to you is
subject to recovery, or “clawback,” by HFSG if the payments or awards were based
on materially inaccurate financial statements or any other materially inaccurate
performance metric criteria (all within the meaning of, and to the full extent
necessary to comply with, EESA). You will not be entitled to any tax gross-up
from HFSG or its affiliates. In addition, while either you or HFSG may terminate
your employment at any time for any legal reason, you will not be entitled to
any severance or other golden parachute payment to the extent prohibited by
EESA. You agree to provide HFSG with 90 days notice of any intention to deliver
a letter of voluntary resignation.
8. Indemnification and Cooperation. During and after your employment, HFSG will
indemnify you in your capacity as a present or former officer, employee or agent
of HFSG to the fullest extent permitted by applicable law, including the laws of
Delaware, and HFSG’s certificate of incorporation and by-laws as to any
third-party claim, action or lawsuit against you. In addition, HFSG will provide
you with director and officer liability insurance coverage (including
post-termination tail coverage) on the same basis as it does for HFSG’s other
executive officers and directors. HFSG agrees to cause any successor to all or
substantially all of the business or assets (or both) of HFSG to assume
expressly in writing and to agree to perform all of the obligations of HFSG in
this paragraph.

 

 

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You agree (whether during or after your employment with HFSG) to reasonably
cooperate with HFSG in connection with any litigation or regulatory matter or
with any government authority on any matter, in each case, pertaining to HFSG
and with respect to which you may have relevant knowledge, provided that, in
connection with such cooperation, HFSG will reimburse your reasonable expenses
and you shall not be required to act against your own legal interests.
9. Tax Matters. This letter agreement is intended to comply with the
requirements of Section 409A of the Internal Revenue Code of 1986
(“Section 409A”). To the extent any taxable expense reimbursement or in-kind
benefits under paragraph 6 or 8 is subject to Section 409A, the amount thereof
eligible in one taxable year shall not affect the amount eligible for any other
taxable year; in no event shall any expenses be reimbursed after the last day of
the taxable year following the taxable year in which you incurred such expenses,
and in no event shall any right to reimbursement or receipt of in-kind benefits
be subject to liquidation or exchange for another benefit. Each payment under
this letter will be treated as a separate payment for purposes of Section 409A.
10. Non-competition and non-solicitation. In consideration for your employment
and the terms hereof, and to protect against the risk that, given the extensive
knowledge of HFSG’s operations that you will acquire during your employment,
HFSG’s confidential information and trade secrets would unavoidably be disclosed
to your new employer if you were to become employed with a competing business,
you agree:
(a) while employed by HFSG and for a one-year period following a voluntary
termination of your employment with HFSG, not to become associated with any
entity, whether as a principal, partner, employee, agent, consultant,
shareholder (other than as a holder, or a member of a group which is a holder,
of not in excess of 1% of the outstanding voting shares of any publicly traded
company) or in any other relationship or capacity, paid or unpaid, that is
actively engaged in any insurance business that is in competition with the
business of HFSG or its affiliates. HFSG shall carefully consider and respond
within 14 (fourteen) business days to a written request that this provision be
waived, but HFSG retains the right, in its sole discretion, to enforce or waive
the terms of this provision consistent with its determination of its business
needs, and
(b) while employed by HFSG and for a one-year period following termination of
your employment with HFSG, not to directly or indirectly solicit, encourage or
induce any employee of HFSG or its affiliates to terminate employment with such
entity, and not to directly or indirectly, either individually or as owner,
agent, employee, consultant or otherwise, employ or offer employment to any
person who is or was employed by HFSG or an affiliate thereof unless such person
shall have ceased to be employed by such entity for a period of at least six
months.

 

 

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11. Confidentiality. You agree that from the date you sign this letter
agreement, you shall not, without the prior written consent of HFSG, except to
the extent required by an order of a court having competent jurisdiction or
under subpoena from an appropriate government agency, disclose to any third
person, or permit the use of for the benefit of any person or any entity other
than HFSG or its affiliates, any trade secrets, customer lists, information
regarding product development, marketing plans, sales plans, management
organization information (including data and other information relating to
members of the Board and management), operating policies or manuals, business
plans, financial records, or other financial, organizational, commercial,
business, sales, marketing, technical, product or employee information relating
to HFSG or its affiliates or information designated as confidential,
proprietary, and/or a trade secret, or any other information relating to HFSG or
its affiliates that you know from the circumstances, in good faith and good
conscience, should be treated as confidential, or any information that HFSG or
its affiliates may receive belonging to customers, agents or others who do
business with HFSG or its affiliates, except to the extent that any such
information previously has been disclosed to the public by HFSG or is in the
public domain. You acknowledge and agree that this confidentiality obligation
shall survive your termination of employment with HFSG.
12. Equitable Relief. You acknowledge and agree that the covenants and
obligations in paragraphs 10 and 11 with respect to noncompetition,
nonsolicitation and confidentiality relate to special, unique and extraordinary
matters and that, given the extensive knowledge of HFSG’s operations that you
will acquire, a violation of any of the terms of these covenants and obligations
will cause HFSG irreparable injury for which adequate remedies are not available
at law. Therefore, you agree that HFSG shall be entitled to an injunction,
restraining order or such other equitable relief (without the requirement to
post bond) restraining you from committing any violation of the covenants and
obligations contained in paragraphs 10 and 11, and that HFSG and its affiliates
shall, to the extent consistent with EESA and other applicable law, have no
obligation to pay any amounts to you following any material violation of the
covenants and obligations contained in those paragraphs. These remedies are
cumulative and are in addition to any other rights and remedies HFSG may have at
law or in equity.
13. Dispute Resolution. This letter agreement shall be governed by the laws of
the State of Connecticut, without reference to principles of conflicts or choice
of law under which the law of any other jurisdiction would apply. In the event
that one or more of the provisions of this letter agreement shall become
invalid, illegal or unenforceable in any respect, the validity, legality and
enforceability of the remaining provisions contained herein shall not be
affected thereby. Except as provided in paragraph 12, any dispute or controversy
arising under or in connection with this letter agreement shall be resolved by
binding arbitration, to be held in the city of Hartford, Connecticut and
conducted in accordance with the Commercial Arbitration Rules of the American
Arbitration Association in effect at the time of the arbitration, and otherwise
in accordance with the principles that would be applied by a court of law or
equity.
14. Compliance with EESA. Notwithstanding anything to the contrary in this
letter agreement, all compensation payable to you by HFSG under this letter
agreement or otherwise shall be limited to the extent required by EESA and other
applicable law.

 

 

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We look forward to your joining the company.

            Sincerely,

THE HARTFORD FINANCIAL SERVICES GROUP, INC.
      By:   /s/ Eileen Whelley         Eileen Whelley        Executive Vice
President,
Human Resources   

I agree with and accept the foregoing terms.

         
/s/ Christopher J. Swift
 
Christopher J. Swift
      February 14, 2010