exv10w1






Exhibit 10.1




SEPARATION AGREEMENT




     1. This Separation Agreement (“Agreement”), dated as of May 5, 2009, is by and between Frank
J. Bramanti (“Executive”) and HCC Insurance Holdings, Inc., a Delaware corporation (“Company”).



     2. The Company currently employs Executive as its Chief Executive Officer (“CEO”) pursuant to
an Amended and Restated Employment Agreement entered into on December 19, 2008, but effective as of
January 1, 2007 (the “Employment Agreement”). Executive also serves as a director of the Company
and certain of the Company’s wholly owned subsidiaries. All references in this Agreement to the
Company shall be deemed to include, unless the context otherwise requires, all of the subsidiaries
of the Company. Executive hereby resigns from his position as CEO effective as of May 5, 2009 and
resigns from all of his other positions as an officer of the Company and each of its subsidiaries
effective as of May 18, 2009 (the “Effective Date”). Executive hereby also resigns as a director
of each of the Company’s subsidiaries as of the Effective Date, but shall remain a director of the
Company until such time as his term as a director ends and he is not re-elected. Beginning on the
Effective Date and for so long as he continues to serve as a Director, Executive shall be
compensated as an outside director.



     3. The parties agree that Executive has received all sums owing to him by the Company pursuant
to the Employment Agreement for salary and benefits accruing through the Effective Date except for:
(a) payment for accrued but unused vacation; (b) expenses for which he is entitled to
reimbursement; and (c) salary payments arising after April 30, 2009. Executive hereby waives
payment for accrued but unused vacation to which he may be entitled. In consideration for the terms
of this Agreement, within five days of the Effective Date, the Company shall pay Executive an
amount in cash equal to $1,000,000 plus salary payments accrued from the date hereof through the
Effective Date, less in each case normal tax and other withholdings, payable in accordance with the
Company’s usual payment procedures. Executive shall submit requests for reimbursement of unpaid
expenses incurred prior to the Effective Date within 60 days of the Effective Date, for which the
Company shall reimburse him in accordance with its usual policy with regard to reimbursement of
employees.



     4. During the month of May, 2009, the Company shall make one final contribution to Executive’s
Participant’s Account as provided in the HCC Insurance Holdings, Inc. NonQualified Deferred
Compensation Plan for Frank J. Bramanti (the “Deferred Compensation Plan”). The Effective Date
will constitute “Participant’s Separation From Service” under the Deferred Compensation Plan and
Executive’s rights under the Deferred Compensation Plan shall thereafter be as provided therein.



     5. Following the Effective Date, all of Executive’s and the Company’s obligations under the
Employment Agreement that are performable prior to the Effective Date shall be terminated and of no
further force and effect. In accordance with the terms of the Employment Agreement, the following
agreements shall survive the termination of the Employment Agreement:




     In accordance with Section 3(g) of the Employment Agreement, within thirty (30)
days of the Effective Date, the Company shall assign to Executive the $5,000,000 in
aggregate face amount of life insurance policies that the Company has



 









 







been keeping in effect for Executive. Following the Effective Date, Executive
shall be responsible for paying all premiums on such life insurance policies.




     In accordance with Section 3(e)(3) of the Employment Agreement, following the
Effective Date, Executive and his qualified beneficiaries shall be entitled to
continue to be covered by medical insurance as currently provided under the
Company’s group program, as such group program may be changed from time to time in
the future, or, if not permitted under the terms of the group program, then the
Company shall provide Executive and his qualified beneficiaries with a medical
insurance policy providing substantially similar benefits as the group program for
the period ending on the later of: (i) the date of Executive’s death; (ii) if
Executive is married on the date of his death, the date of the death of Executive’s
spouse; or (iii) as to each minor dependent of Executive, the later of the date that
each such dependent reaches the age of twenty-five or completes college (as defined
in the Company’s group program). Executive and his qualified beneficiaries shall be
entitled to receive the medical benefits defined herein at no cost and without any
concession to Executive and his qualified beneficiaries. This paragraph reaffirms
and extends the Company’s obligations as set out in Section 3(e)(3) of the
Employment Agreement and is not intended to limit or reduce the benefits therein
conferred on Executive or his qualified beneficiaries.




     In accordance with Section 5(h) of the Employment Agreement, Executive hereby
reaffirms Executive’s obligations under the following sections of the Employment
Agreement, which Executive and the Company agree shall continue to apply to
Executive following the Effective Date as if recited herein in full: Sections 5(c)
Non-Competition After Termination, 5(d) Non-Solicitation of Customers, 5(e)
Non-Solicitation of Employees, 5(f) Confidential Information, 5(g) Return of
Documents, Equipment, Etc., 5(k) Breach, 5(m) Extension of Post-Employment
Restrictions, and 5(n) Enforceability.



     6. Executive currently holds the following nonqualified stock options (the “Outstanding
Options”):



	 	 	 	 	 	 	 	 	 
	No. of Shares	 	Vesting Date	 	Exercise Price	 	Expiration Date
	18,750
	 	Already Vested	 	$	21.37	 	 	12/20/2009
	12,500
	 	Already Vested	 	$	30.85	 	 	1/5/2011
	200,000
	 	Already Vested	 	$	31.11	 	 	3/2/2012
	100,000
	 	3/2/2010	 	$	31.11	 	 	3/2/2012
	100,000
	 	3/2/2011	 	$	31.11	 	 	3/2/2012
	100,000
	 	3/2/2011	 	$	31.11	 	 	3/2/2012
	50,000
	 	3/2/2011	 	$	31.11	 	 	3/2/2012





Outstanding Options vested as of the Effective Date shall continue to be exercisable until the
expiration date set forth above. Options not vested as of the Effective Date shall be forfeited as
of the Effective Date. The provisions of this Section 6 shall be subject to the approval of the
Compensation Committee of the Board of Directors, at its next regularly scheduled meeting on May
20, 2009.




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     7. On or before the Effective Date, Executive shall be entitled to use the Company’s aircraft
for one round-trip personal flight within the continental United States. Personal use of the
Company’s aircraft shall be taxable to Executive based on the then-current Internal Revenue Service
rules for the taxation of such benefit.



     8. No modification to any provisions contained in this Agreement shall be binding upon any
party unless made in writing and signed by both parties.



     9. If any provision of this Agreement is held to be unenforceable for any reason, the
remaining parts of the Agreement shall remain in full force and effect.



     10. This Agreement shall be construed in accordance with Texas law.



     11. Except as expressly set forth in this Agreement, the Option Agreements and the Deferred
Compensation Plan, this Agreement constitutes a single, integrated written contract expressing the
entire agreement of the parties to this Agreement. Any other agreements, discussions, promises,
and representations have been and are integrated into and superseded by this Agreement, the Option
Agreements and the Deferred Compensation Plan.



     12. With respect to Executive, this Agreement shall also bind and inure to the benefit of his
respective heirs and assigns. With respect to the Company, this Agreement shall also bind and
inure to the benefit of any affiliated entities, successor-in-interests, or assigns.



     13. Any notices required to be given shall be given as set forth in Section 10 of the
Employment Agreement



     14. This Agreement may be executed in separate counterparts each of which shall be an original
and all of which taken together shall constitute one and the same agreement.



[Signature page follows.]




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	 	HCC INSURANCE HOLDINGS, INC.

 	 
	 	By:  	/s/ John N. Molbeck, Jr.
 	 
	 	 	John N. Molbeck, Jr., President 	 
	 	 	 	 
	 
	 	 	 
	 	/s/  Frank J. Bramanti
 	 
	 	Frank J. Bramanti 	 
	 	 	 
	 




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