any CNA companies elect Executive to its board of directors. Executive has also been electedas an executive officer of CNA Financial Corporation (“CNAF”), a public company that is theindirect parent of the Company, and Executive agrees to serve in such capacity for the term of thisAgreement without additional compensation; provided, however, that nothing in this Agreement shallrequire that CNAF maintain Executive in any such position.     (b) Executive shall diligently and to the best of his abilities continue to assume, perform,and discharge the duties and responsibilities of Executive Vice President, GC, as well as suchother specific duties and responsibilities as the CEO shall assign or designate to Executive fromtime to time not inconsistent with Executive’s status. Executive shall devote substantially all ofhis working time to the performance of his duties as set forth herein and shall not, without theprior written consent of the CEO, accept other employment or render or perform other services, norshall he have any direct or indirect ownership interest in any other business which is incompetition with the business of the Company or the CNA companies, other than in the form ofpublicly traded securities constituting less than five percent (5%) of the outstanding securitiesof a corporation (determined by vote or value) or limited partnership interests constituting lessthan five percent (5%) of the value of any such partnership. The foregoing shall not precludeExecutive from engaging in charitable, professional, and personal investment activities, providedthat, in the judgment of the CEO, such activities do not materially interfere with the performanceof his duties and responsibilities hereunder.     3. **Compensation**.     (a) During the Term, the Company shall pay to Executive for the period he is employed by theCompany hereunder, an annual base salary of $800,000.00 (the “Base Compensation”). The BaseCompensation shall be payable not less frequently than in monthly increments. At the discretion ofthe CEO and/or the Compensation Committee (the “Committee”) of CNAF’s Board of Directors, suchsalary rate may be increased annually during the term of the Agreement, based on marketconsiderations, responsibilities and performance. In no event shall Executive’s salary rate bereduced to an amount that is less than the amount specified in this Section 3(a) withoutExecutive’s written consent, or to an amount that is less than the amount that he was previouslyreceiving without Executive’s written consent.
 

 
     (b) The Executive shall be eligible for an annual incentive cash award (“Bonus”) pursuant tothe CNA Financial Corporation 2000 Incentive Compensation Plan (the “Plan”). Subject to theapproval of the Committee, the Executive’s maximum Bonus opportunity thereunder shall not exceed200% of Executive’s annual Base Compensation for each twelve month bonus period. In no event shallthe maximum Bonus opportunity be reduced without the Executive’s written consent. The amount of theBonus shall be based on the Committee’s assessment in its sole discretion of Executive’sperformance and the Net Operating Income goals set annually by the Committee, and shall bedetermined and payable in accordance with the terms of the Plan as set forth in the Plan documents.Provided, further, that the Committee shall have unlimited negative discretion under the Plan todecrease the amount of Executive’s Bonus for any year.     (c) Subject to the approval of the Committee, Executive shall be eligible to receive along-term incentive cash award, in accordance with the terms of the Plan, as may be in effectduring the Term or such other long term incentive plan as the Company may from time to time adoptfor its senior officers. The Executive’s target long-term incentive cash award shall be thirtypercent (30%) of his Base Compensation during the three-year performance period as determined bythe Company and/or the Committee. In no event shall the target award be reduced without theExecutive’s written consent. Actual payout of the long-term incentive cash award may range from 0%to 200% of target, based on the Company’s overall business results and performance as determined bythe Committee in its sole discretion, subject to the terms of the Plan.     (d) Subject to the approval of the Committee, Executive shall be awarded a minimum grant of30,000 stock appreciation rights paid in stock (“SARs”) of CNA Financial Corporation (“CNAF”)common stock or equivalent stock options annually during the term of Executive’s employment underthis Agreement. Such annual grant may be increased at the recommendation of the CEO and uponapproval of the Committee, subject to share availability. Executive’s rights with respect to sharesawarded hereunder shall be subject to the terms of the Plan, share availability and approval by theCommittee.     (e) Subject to the approval of the Committee and the following conditions, Executive shall beawarded a retention bonus (the “Retention Bonus”) of $800,000, of which amount 50% shall be payableon June 30, 2009 (the “First Payment Date”) and the other 50% on June 30,
 

 
2010 (the ”Second Payment Date”). Executive shall not receive any unpaid portion of theRetention Bonus if he voluntarily terminates his employment as provided in Section 6.4 of thisAgreement prior to either Payment Date, or if he is terminated for Cause by the Company as providedfor in Section 6.2 of this Agreement prior to either Payment Date. If Executive’s employment isterminated by the Company Without Cause, or if he terminates his employment for Good Reason asprovided for in Section 6.3 of this Agreement, then the payment dates for any unpaid portion of theRetention Bonus shall be accelerated to the date of such termination.     (f) For avoidance of doubt respecting awards to Executive under Section 3(b), 3(c) and 3(d)hereof, the provisions of the Plan relating to the deferral of payments to satisfy Section 162(m)of the Internal Revenue Code of 1986 (“Code”) or any successor provision shall apply. The Companywill defer until the first tax year in which it reasonably anticipates, or should reasonablyanticipate, that deductibility is not limited by said Section 162(m) the payment of allcompensation to which Executive is entitled under this Agreement and/or the Plan which the Companyreasonably anticipates would be non-deductible under said Section 162(m) or any successor provisionwith respect to deductibility of executive compensation if paid in the tax year in which it wouldotherwise be payable; provided that such amounts shall in any event be paid not later than theperiod beginning on the date on which Executive separates from service (as defined in Section 409Aof the Code) and ending on the later of the last day of the year in which the Executive separatesfrom service or the fifteenth day of the third month following the separation from service; andprovided further, that if any payment is deferred pursuant to this Section 3(f) until afterExecutive has separated from service and Executive is a specified employee as defined in Section409A on the date of the separation from service, the preceding proviso shall be applied bysubstituting the day that is six months after Executive’s separation from service for the date ofseparation from service.     (g) Executive’s pensionable earnings under the CNA Retirement Plan, the CNA SupplementalExecutive Retirement Plan (“SERP”), the Savings & Capital Accumulation Plan (“S-CAP”), and the CNASupplemental Savings & Capital Accumulation Plan (“SES-CAP”) will be calculated and payable asspecified in the respective plan documents, as amended from time to time, and also subject to therequirements of any other applicable laws or regulations as interpreted by the Company. Anydeferral elections available to Executive with respect to such pensionable earnings shall be madeprior to the beginning of the year in which any amounts subject to such elections are earned.
 

 
     (h) All payments due under this Agreement shall be subject to withholding or deferral asrequired by law.     4. **Other Benefits**. Executive shall be entitled to continue to participate in the variousbenefit plans, programs or arrangements established and maintained by the Company from time to timeand applicable to senior executives of the Company such as, but not by way of limitation, medicalbenefits, dental benefits, life insurance, long-term disability insurance, both qualified andsupplemental defined contribution plans, and to receive all fringe benefits made available tosenior executives of the Company, including relocation assistance, club membership, and tax returnpreparation. Executive’s entitlement to participate in any such plan, program or arrangement shall,in each case, be subject to the terms and conditions of the Company’s policies with regard to suchplans, programs or arrangements as adjusted by the Company from time to time in its solediscretion. Executive shall not be eligible for paid time off (“PTO”) under the Company’s PTOpolicy. In the event of termination of employment, Executive’s severance shall be determined solelyin accordance with Section 6 hereof.     5. **Expense Reimbursement**. Executive shall continue to be entitled to reimbursement by theCompany for all reasonable and customary travel and other business expenses incurred by Executivein carrying out his duties under this Agreement, in accordance with the general travel and businessreimbursement policies adopted by the Company as adjusted from time to time. Executive shall reportall such expenditures not less frequently than monthly accompanied by adequate records and suchother documentary evidence as required by the Company or by Federal or state tax statutes orregulations governing the substantiation of such expenditures.     6. **Termination of Employment**. If Executive’s employment with the Company shall terminateduring the term of this Agreement, the following conditions set forth herein shall apply withrespect to the Executive’s compensation and benefits hereunder. Either party may terminateExecutive’s employment with the Company during the term of this Agreement by written notice to theother party, effective as of the date specified in such notice and Executive’s employment shallautomatically terminate in the event of Executive’s death. Upon termination of Executive’semployment during or at the end of the term of this Agreement, the rights of the parties under thisAgreement shall be determined pursuant to this Section 6. All payments to be made hereunder shallbe made either to Executive or to his personal representatives, heirs or
 

 
beneficiaries, as the case may be. In the event of Executive’s termination during the term ofthis Agreement, unless otherwise specified in this Agreement Executive’s rights, if any, under anyof the Company’s defined contribution, benefit, incentive or other plans of any nature shall begoverned by the respective terms of such plans.     6.1 **Death and Disability**. In the event of the death of Executive or, at the Company’selection, in the event of his Permanent Disability (as defined below) during the term of thisAgreement, provided it has not already terminated, Executive’s employment shall terminate;provided, however, that:     (a) The Company shall pay to Executive or his personal representatives, heirs or beneficiariesas the case may be, an amount equal to his: (i) unpaid base salary and current year’s Bonuscalculated at 150% of base salary and CNA long-term incentive cash award prorated to the date oftermination; (ii) any previous year’s unpaid Bonus based upon actual or discretionary payouts, ifany; and (iii) unpaid cash entitlements, if any, earned by Executive or payable to hisbeneficiaries as of the date of termination which, pursuant to the terms of any applicable Companyplan or program (which unpaid cash entitlements shall not include any unpaid Bonus or any unpaidlong-term incentive cash award or other award under the Incentive Compensation Plan), accrued priorto the date of termination.     (b) For purposes of this Agreement, the term “Permanent Disability” means a physical or mentalcondition of Executive which, as determined by the CEO based on and consistent with availablemedical information, is expected to continue beyond 26 weeks and which renders Executive incapableof performing any substantial portion of the services contemplated hereunder with reasonableaccommodation compatible with the fulfillment of his duties as described in Section 2 hereinabove.     6.2 **Termination for Cause by the Company**. In the event that Executive shall engage in anyconduct which the CEO in his sole discretion shall determine to be “**Cause**,” as defined herein, heshall be subject to termination forthwith. For purposes of this Agreement, Cause shall meanengaging in or committing: (i) any act which would constitute a felony or other act involvingfraud, dishonesty, moral turpitude, unlawful conduct or breach of fiduciary duty; (ii) asubstantial breach of any material provision of this Agreement; (iii) a willful or recklessmaterial misconduct in the performance of the Executive’s duties; or (iv) the habitual neglect ofduties;
 

 
provided however, that, for purposes of clauses (iii) and (iv), Cause shall not include anyone or more of the following: bad judgment, negligence or any act or omission believed by theExecutive in good faith to have been in or not opposed to the interest of the Company (without anyintent by the Executive to gain, directly or indirectly, a profit to which he was not legallyentitled). If the Executive agrees to resign from his employment with the Company in lieu of beingterminated for Cause, he may be deemed to have been terminated for Cause for purposes of thisAgreement.     Upon terminating the Executive for Cause, other than paying the Executive within 30 days ofsuch termination his: (i) unpaid base salary prorated to the date of termination and (ii) unpaidcash entitlements, if any, earned and accrued pursuant to the terms of any applicable Company planor program (which unpaid cash entitlements shall not include any unpaid Bonus or any unpaidlong-term incentive cash award or other award under the Incentive Compensation Plan) prior to thedate of the date of termination, the Company shall have no further obligations whatsoever toExecutive under this Agreement. In the event of termination for Cause, Executive agrees to continueto be bound by the covenants set forth herein at Sections 7 through 13, subsequent to the date ofsuch termination for such periods of time as provided for in said Sections respectively.     6.3 **Termination by the Company Without Cause / Termination by Executive for Good Reason**. Inthe event Executive’s employment is terminated by the Company “**Without Cause”**(as that term isdefined hereinbelow), or in the event Executive terminates his employment for “**Good Reason**” (asthat term is defined hereinbelow):     (a) The Company shall pay to Executive severance consisting of an amount equal to $3,600,000.The severance shall be paid over two (2) years in equal monthly installments following suchtermination. The Company shall also pay the Executive within 30 days of his termination: (i) hisunpaid base salary, prorated to the date of termination and (ii) unpaid cash entitlements, if any,earned and accrued pursuant to the terms of any applicable Company plan or program prior to thedate of the date of termination (which unpaid cash entitlements under this Section 6.3(a)(ii) shallnot include any unpaid Bonus or any unpaid long-term incentive cash award or other award under thePlan for the year in which such termination occurs). Executive agrees to be bound by the covenantsset forth herein prior to, as of and subsequent to the termination date. In addition, Executiveshall continue to participate, at the active employee rates, in such health benefits plans in whichhe is enrolled throughout the term of the payments
 

 
set forth in this Section 6.3(a), up to a maximum of 18 months, with said period ofparticipation to run concurrently with any period of COBRA coverage to which Executive may beentitled. To the extent such health benefit coverage extends beyond the aforesaid period of COBRAcoverage, and to the extent that in such case the difference between the premium paid by Executivefor participation in such health benefit plans and the premium that would be payable by an employeereceiving COBRA coverage constitutes taxable income to Executive, and deferred compensation,subject to Section 409A of the Code Executive shall not receive any payment or other benefit inlieu of such coverage. Other than as set forth in this Section 6.3 (a), the Company shall have nofurther obligations to Executive under this Agreement in the event of a termination of Executive’semployment by the Company Without Cause or any termination of Executive’s employment by Executive.     (b) “Good Reason” as set forth herein is defined as a reduction in the rate of Executive’sbase salary, annual incentive maximum opportunity or long-term incentive cash target compensation,a required relocation of his personal residence to another geographical area outside of thegeographical area where Executive’s personal residence is currently located without Executive’sconsent, a change in Executive’s direct reporting relationship to the CEO or other involuntary lossof position as described herein (other than as a result of a termination by the Company for Cause)or a material diminution in Executive’s duties and responsibilities without Executive’s consent.     (c) “Without Cause” as set forth herein is defined as a termination of the Executive’semployment by the Company for any reason not described in subsections 6.1 and 6.2.     Any term or provision in this Agreement to the contrary notwithstanding, the timing and otherconditions of any severance or other payments to be made under this Agreement shall be subject tothe requirements of all applicable laws and regulations, whether or not they are in existence or ineffect when this Agreement is executed by the parties hereto. In the event of any termination ofemployment as described in this Section 6.3, Executive agrees to continue to be bound by thecovenants set forth herein at Sections 7 through 13 subsequent to the date of such termination forsuch periods of time as provided for in said Sections respectively.     6.4 **Voluntary Resignation by Executive**. In the event that Executive’s employment isvoluntarily terminated by Executive other than pursuant to subsection 6.3 or as a direct result of
 

 
his death or Permanent Disability (as described in subsection 6.1), the Company shall have nofurther obligations to Executive under this Agreement other than paying the Executive within 30days of such termination his: (i) unpaid base salary prorated to the date of termination and (ii)unpaid cash entitlements, if any, earned and accrued pursuant to the terms of any applicableCompany plan or program (which unpaid cash entitlements shall not include any unpaid Bonus or anyunpaid long-term incentive cash award or other award under the Plan) prior to the date oftermination. In the event of termination of employment as described in this Section 6.4, Executiveagrees to continue to be bound by the covenants set forth herein at Sections 7 through 13subsequent to the date of such termination for such periods of time as provided for in saidSections respectively.     6.5 **Expiration of Agreement**.     (a) If the Company has not made an offer to Executive by March 31, 2011 to extend hisemployment with the Company under a compensation structure substantially similar to the oneprovided for in this Agreement, Executive’s employment shall terminate at close of business on June30, 2011 and his employment shall be treated as having been terminated in accordance with Section6.3 of this Agreement (relating to Termination by Company Without Cause/ Termination by Executivefor Good Reason), and the sole payments and benefits to which he may be entitled shall be governedby said Paragraph. Other than as set forth in this Section 6.5 (a), the Company shall have nofurther obligations to Executive under this Agreement in the event of a termination of Executive’semployment by the Company due to its expiration under the terms of this Agreement, except asotherwise set forth in subset (b) of this Section 6.5.     (b) Notwithstanding the foregoing, if Executive’s employment with the Company terminatesfollowing Executive’s rejection of an offer by the Company to extend the term of the Agreement orto enter into a new Agreement prior to termination, with Base Compensation, Bonus and long-termincentive cash award target that are not less than Executive’s Base Compensation, Bonus andlong-term incentive cash award target as of the date of the termination or if Executive voluntarilyresigns, then his employment shall be treated as having been terminated in accordance with Section6.4 of this Agreement (relating to Voluntary Resignation), and the sole payments to which he may beentitled shall be governed by said Paragraph. In the event of termination of employment asdescribed in any portion of this Section 6.5, Executive agrees to continue to be bound by thecovenants set forth herein at Sections 7
 

 
through 14 subsequent to the date of such termination for such periods of time as provided forin said Sections respectively.     6.6 **Other Benefits**. In the event that Executive’s employment is terminated pursuant toSections 6.1, 6.2 or 6.4, Executive’s coverage under the Company’s short-term disability plan,shall end on the date of termination of employment; Executive’s coverage under the Company’slong-term disability plan shall end on the date of termination of employment; and Executive’scoverage under the Company’s non-contributory and contributory life, dependent life and accidentaldeath and dismemberment plans shall end on the last day of the month in which termination occurs.In the event that Executive’s employment is terminated pursuant to Section 6.3, the foregoing shallalso apply, except that Executive’s coverage under the Company’s contributory life, dependent lifeand contributory accidental death and dismemberment plans, if any, shall continue through the endof any applicable severance period, upon payment of the applicable premium.     6.7 **Release.**Executive acknowledges that the severance benefits set forth in Section 6 hereofprovide significant additional benefits as compared to those available to the Company’s employeesin general. As a condition precedent to receiving any payments or other benefits pursuant toSection 6 of this Agreement, Executive agrees to sign a full and complete release acceptable to theCompany releasing the Company, its subsidiaries and affiliates and their directors, officers andemployees of any and all claims, both known and unknown as of the date of Executive’s terminationof employment with the Company. In the absence of Executive’s executing such a release in a formsatisfactory to the Company, the Company shall have no obligation to Executive to make any paymentsor provide any other benefits as provided in said Section 6. The Company shall furnish the releaseto Executive as soon as practical, but in no event more than ten (10) days after the date on whichExecutive’s employment is terminated. If Executive executes and delivers such release to theCompany prior to March 15 of the year following the year in which his employment is terminated (or,if Executive has the right to revoke such release pursuant to the Age Discrimination in EmploymentAct or any other applicable law, executes and delivers such release at such time that suchrevocation period will expire prior to such March 15), then all Payments (as defined in Section6.8) that would otherwise have been paid prior to the date on which the release is executed anddelivered shall be paid to Executive in a lump sum, without interest, as soon as practical aftersuch release is delivered (or such revocation period expires), but not later than such March 15.If Executive fails to execute and
 

 
deliver such release prior to the date set forth in the preceding sentence, then the Companyshall have no obligation to pay to Executive any Payments that would otherwise have been payableprior to such March 15.     6.8 **Involuntary Termination Rule.**Any term or provision of this Section 6 or elsewhere in theAgreement to the contrary notwithstanding, the following provisions shall apply to any payments tobe made to Executive pursuant to Section 6.1 on termination by reason of Permanent Disability,Section 6.3, or Section 6.5(a) (collectively the “Payments”): (a) Each Payment to be made on a separate date shall be treated as a separatePayment for purposes of §409A of the Code.  (b) The aggregate amount of all Payments, if any, payable after March 15 of theyear following the year that includes the date of such involuntary termination (the“Termination Date”) but before the date that is six months after the Termination Date(increased by any other amounts of taxable compensation paid to the Executive duringsuch period that would not have been paid but for such termination) shall not exceedtwo times the lesser of (i) Executive’s Base Compensation on the last day of the yearimmediately prior to the year that includes the Termination Date or (ii) the limit ineffect under §401(a)(17) of the Code during the year that includes the TerminationDate, as determined by the Company.  (c) To the extent the Payments payable during the period described in subparagraph(b) above would otherwise exceed the limit of subparagraph (b), such Payments shall bereduced to the extent necessary to satisfy the requirement of subparagraph (b) asdetermined by the Company, and the amount by which the Payments are reduced will bepaid to Executive in a lump sum, without interest, on the first business day that issix months after the Termination Date as determined by the Company. However, ifExecutive dies during such period, the limits of subparagraph (b) shall not apply toPayments to the Executive’s beneficiaries or estate.  (d) If Executive’s termination of employment does not constitute a “separation fromservice” as defined in §409A of the Code, as determined by the Company, then
 

 
   all Payments that would otherwise be payable after March 15 of the year followingthe year that includes the Termination Date, and that exceed the limit described inSection 6.8(b), shall be deferred until six months after Executive has incurred aseparation from service, as so defined, and all Payments that are so deferred shallbe paid in a lump sum, without interest, on the first business day that is at leastsix months after Executive has incurred a separation from service.     7. **Confidentiality**. Executive agrees that while he is employed by the Company, and at alltimes thereafter, Executive shall not reveal or utilize information, knowledge or data which isconfidential as defined in this Agreement and learned during the course of or as a result of hisemployment which relates to: (a) the Company and/or any other business or entity in which theCompany during the course of the Executive’s employment has directly or indirectly held a greaterthan a 10% equity interest whether voting or non-voting; and (b) the Company’s customers,employees, agents, brokers and vendors. The Executive acknowledges that all such confidentialinformation is commercially valuable and is the property of the Company. Upon the termination ofhis employment Executive shall return all confidential information and any copies thereof to theCompany, whether it exists in written, electronic, computerized or other form.     8. **“Confidential Information” Defined**. For purposes of this Agreement “confidentialinformation” includes all information, knowledge or data (whether or not a trade secret orprotected by laws pertaining to intellectual property) not generally known outside the Company(unless as a result of a breach of any of the obligations imposed by this Agreement) concerning thebusiness operations, performance and other information of the Company or other entities asdescribed in Section 7 above. Such information may without limitation include information relatingto data, finances, marketing, pricing, profit margins, underwriting, claims, loss control,marketing and business plans, renewals, software, processing, vendors, administrators, customers orprospective customers, products, brokers, agents and employees.     9. **Competition**. Executive hereby agrees that, while he is employed by the Company, and for aperiod of 6 months following the date of his termination of employment with the Company for anyreason, he will not, directly or indirectly, without the prior written approval of the CEO, enterinto any business relationship (either as principal, agent, board member, officer, consultant,stockholder, employee or in any other capacity) with any business or other entity
 

 
that at any relevant time is engaged in the business of insurance in direct or indirectcompetition with the Company or any of its affiliates (a “Competitor”); provided, however, thatsuch prohibited activity shall not include the ownership of less than 5% of the outstandingsecurities of any publicly traded corporation (determined by vote or value) regardless of thebusiness of such corporation. Upon the written request of Executive, the CEO will determine whethera business or other entity constitutes a “Competitor” for purposes of this Section 9; provided thatthe CEO may require Executive to provide such information as the CEO determines to be necessary tomake such determination; and further provided that the current and continuing effectiveness of suchdetermination may be conditioned on the accuracy of such information, and on such other factors asthe CEO may determine.     10. **Solicitation**. Executive agrees that while he is employed by the Company, and for a periodof 24 months following his termination of employment with the Company for any reason, he will notemploy, offer to employ, engage as a consultant, or form an association with any person who isthen, or who during the preceding one year was, an employee of the Company or any Subsidiary orAffiliate of the Company or any successor or purchaser of any portion thereof, nor will he assistany other person or entity in soliciting for employment or consultation any person who is then, orwho during the preceding one year was, an employee of the Company or any Subsidiary or Affiliate ofthe Company or any successor or purchaser of any portion thereof.     11. **Non-interference**. Executive agrees that while he is employed by the Company, and for aperiod of 24 months following his termination of employment with the Company for any reason, hewill not disturb or attempt to disturb any business relationship or agreement between either theCompany or any Subsidiary or Affiliate of the Company or any successor or purchaser of any portionthereof, and any other person or entity.     12. **Assistance with Claims**. Executive agrees that, while he is employed by the Company, andfor a reasonable period (not less than 60 months from the date of termination) thereafter, he willbe available, on a reasonable basis, to assist the Company and its subsidiaries and affiliates inthe prosecution or defense of any claims, suits, litigation, arbitrations, investigations, or otherproceedings, whether pending or threatened (“Claims”) that may be made or threatened by or againstthe Company or any of its subsidiaries or affiliates. Executive agrees, unless precluded by law, topromptly inform the Company if he is requested (i) to testify or otherwise become involved inconnection with any Claim against the Company or
 

 
any subsidiary or affiliate or (ii) to assist or participate in any investigation (whethergovernmental or private) of the Company or any subsidiary or affiliate or any of their actions,whether or not a lawsuit has been filed against the Company or any of its subsidiaries oraffiliates relating thereto. The Company agrees to provide reasonable compensation to Executive forsuch assistance provided during such period. Nothing in this Section 12 is intended or shall beconstrued to prevent Executive from cooperating fully with any government investigation or reviewas required by applicable law or regulation.     13. **Return of Materials**. Executive shall, at any time upon the request of the Company, and inany event upon the termination of his employment with the Company for any reason, immediatelyreturn and surrender to the Company all originals and all copies, regardless of medium, of propertybelonging to the Company created or obtained by Executive as a result of or in the course of or inconnection with his employment with the Company regardless of whether such items constituteproprietary information, provided that Executive shall be under no obligation to return writtenmaterials acquired from third parties which are generally available to the public. Executiveacknowledges that all such materials are, and will remain, the exclusive property of the Company.     14. **Scope of Covenants**.     (a) The Executive acknowledges that: (i) as a senior executive of the Company he has and willhave access to confidential information concerning not only the business segments for which he mayhave been responsible (an outline summary of which appears in the Company’s reports on Forms 10-Kand 10-Q filed with the Securities and Exchange Commission) but the entire range of businesses inwhich the Company was engaged; (ii) that the businesses segments for which he may have beenresponsible and the Company’s businesses are conducted nation-wide; and (iii) that the Company’sconfidential information, if disclosed or utilized without its authorization would irreparably harmthe Company in: (A) obtaining renewals of existing customers; (B) selling new business; (C)maintaining and establishing existing and new relationships with employees, agents, brokers,vendors; and (D) other ways arising out of the conduct of the businesses in which the Company isengaged.     (b) To protect such information and such existing and prospective relationships, and for othersignificant business reasons, the Executive agrees that it is reasonable and necessary
 

 
that: (i) the scope of this Agreement be national and international; (ii) its breadth includethe entire insurance industry; and (iii) the duration of the restrictions upon the Executive be asindicated therein.     (c) The Executive acknowledges that the Company’s customer, employee and businessrelationships are long-standing, indeed, near permanent and therefore are of great value to theCompany. The Executive agrees that neither any of the provisions in this Agreement nor theCompany’s enforcement of it alters or will alter his ability to earn a livelihood for himself andhis family and further that both are reasonably necessary to protect the Company’s legitimatebusiness and property interests and relationships, especially those which he was responsible fordeveloping or maintaining. The Executive agrees that his actual or threatened breach of thecovenants set forth in Sections 7 through 13 above would cause the Company irreparable harm andthat the Company is entitled to an injunction, in addition to whatever other remedies may beavailable, to restrain such actual or threatened breach. The Executive agrees that if bond isrequired in order for the Company to obtain such relief, such bond need only be in a nominal amountand that he shall reimburse the Company for all costs of any such suit, including the Company’sreasonable attorneys’ fees. The Executive consents to the filing of any such suit against him inthe state or federal courts located in Illinois or any state in which he resides. He further agreesthat in the event of such suit or any other action arising out of or relating to this Agreement,the parties shall be bound by and the court shall apply the internal laws of the State of Illinoisand irrespective of rules regarding choice of law or conflicts of laws.     (d) If he has not already done so, Executive agrees to be bound by and to execute theCompany’s Confidentiality, Computer Responsibility and Professional Certification Agreement, a copyof which is incorporated by reference herein.     (e) For purposes of Sections 7 through 14 hereof, the “Company” shall include all subsidiariesand affiliates of the Company and CNAF, as well as the Company.     15. **Effect of Covenants**. Nothing in Sections 7 through 14 shall be construed to limit orotherwise adversely affect any rights, remedies or options that the Company would possess in theabsence of the provisions of such Sections.
 

 
     16. **Revision**. The parties hereto expressly agree that in the event that any of the provisions,covenants, warranties or agreements in this Agreement are held to be in any respect an unreasonablerestriction upon Executive or are otherwise invalid, for whatsoever cause, then the court orarbitrator so holding is hereby authorized to (a) reduce the territory to which said covenant,warranty or agreement pertains, the period of time in which said covenant, warranty or agreementoperates or the scope of activity to which said covenant, warranty or agreement pertains or (b)effect any other change to the extent necessary to render any of the restrictions contained in thisAgreement enforceable.     17. **Severability**. Each of the terms and provisions of this Agreement is to be deemed severablein whole or in part and, if any term or provision of the application thereof in any circumstancesshould be invalid, illegal or unenforceable, the remaining terms and provisions or the applicationthereof to circumstances other than those as to which it is held invalid, illegal or unenforceable,shall not be affected thereby and shall remain in full force and effect.     18. **Binding Agreement; Assignment**. This Agreement shall be binding upon the parties hereto andtheir respective heirs, successors, personal representatives and assigns. The Company shall havethe right to assign this Agreement to any successor in interest to the business, or any majoritypart thereof, of the Company or any joint venture or partnership to which the Company is a jointventurer or general partner which conducts substantially all of the Company’s business. Executiveshall not assign any of his obligations or duties hereunder and any such attempted assignment shallbe null and void.     19. **Controlling Law; Jurisdiction**. This Agreement shall be governed by, interpreted andconstrued according to the laws of the State of Illinois (without regard to choice of law orconflict of laws principles).     20. **Entire Agreement**. Except as otherwise expressly set forth herein, this Agreement containsthe entire agreement of the parties with regard to the subject matter hereof, supersedes all prioragreements and understandings, written or oral (including without limitation that certainEmployment Agreement made as of March 20, 2003 between Executive and CNAF), and may only be amendedby an agreement in writing signed by the parties thereto. Any term or provision herein to thecontrary notwithstanding, the timing and other conditions of any severance or other payments to bemade under this Agreement shall be subject to the
 

 
requirements of all applicable laws and regulations as interpreted by the Company, whether ornot they are in existence or in effect when this Agreement is executed by the parties hereto.     21. **Additional Documents**. Each party hereto shall, from time to time, upon request of theother party, execute any additional documents which shall reasonably be required to effectuate thepurposes hereof.     22. **Incorporation**. The introductory recitals hereof are incorporated in this Agreement and arebinding upon the parties hereto.     23. **Failure to Enforce**. The failure to enforce any of the provisions of this Agreement shallnot be construed as a waiver of such provisions. Further, any express waiver by any party withrespect to any breach of any provision hereunder by any other party shall not constitute a waiverof such party’s right to thereafter fully enforce each and every provision of this Agreement.     24. **Survival**. Except as otherwise set forth herein, the obligations contained in thisAgreement shall survive the termination, for any reason whatsoever, of Executive’s employment withthe Company.     25. **Headings**. All numbers and headings contained herein are for reference only and are notintended to qualify, limit or otherwise affect the meaning or interpretation of any provisioncontained herein.     26. **Notices**. Notices and all other communications provided for in this Agreement shall be inwriting and shall be delivered personally or sent by registered or certified mail, return receiptrequested, postage prepaid (provided that international mail shall be sent via overnight or two-daydelivery), or sent by facsimile or prepaid overnight courier to the parties at the addresses setforth below (or such other addresses as shall be specified by the parties by like notice). Suchnotices, demands, claims and other communications shall be deemed given:     (a) in the case of delivery by overnight service with guaranteed next day delivery, the nextday or the day designated for delivery;
 

 
     (b) in the case of certified or registered U.S. mail, five days after deposit in the U.S.mail; or     (c) in the case of facsimile, the date upon which the transmitting party received confirmationof receipt by facsimile, telephone or otherwise;provided, however, that in no event shall any such communications be deemed to be given later thanthe date they are actually received. Communications that are to be delivered by the U.S. mail or byovernight service or two-day delivery service are to be delivered to the addresses set forth below:If to the Company: