EX-10.1: AMENDMENT TO EMPLOYMENT AGREEMENT



 




Exhibit 10.1




AMENDMENT DATED AS OF DECEMBER 1, 2003

TO THE JANUARY 21, 2003 EMPLOYMENT AGREEMENT

BETWEEN

THE CHUBB CORPORATION and JOHN D. FINNEGAN




     The Chubb Corporation (the “Corporation”) and John D. Finnegan (the
“Executive”) hereby agree to amend the Employment Agreement (the “Agreement”)
dated January 21, 2003 by and between the Corporation and Executive as follows:




	 	1.	 	Notwithstanding the provisions of Section 3(b)(vi) of the
Agreement, the Executive hereby agrees to forfeit 30,808 Restricted
Shares of Common Stock of the Corporation previously granted to
Executive pursuant to Section 3(b)(vi) of the Agreement in exchange
for an award by the Corporation of 30,808 Restricted Stock Units to
Executive as set forth in the Restricted Stock Unit Agreement
attached hereto as Exhibit A.






	 	2.	 	Notwithstanding the provisions of Section 3(b)(viii) of the
Agreement, Executive hereby agrees to the substitution by the
Corporation of the Performance Share Award provided for in Section
3(b)(viii) of the Agreement with an award of 31,270 Restricted
Shares of Common Stock of the Corporation as set forth in the
Restricted Stock Award Agreement attached hereto as Exhibit B.






	 	3.	 	Section 5(a)(ii) of the Agreement is hereby amended to add
the words “restricted stock unit” immediately after the reference to
“restricted stock”.






     IN WITNESS WHEREOF, the Executive has hereunto set the Executive’s hand
and, pursuant to the authorization from its Board of Directors, the Corporation
has caused these presents to be executed in its name and on its behalf, all as
of December 1, 2003.




	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	

	 	 	 	 	          John D. Finnegan
	 	 	 	 	 
	 	 	 	 	THE CHUBB CORPORATION
	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	

	 	 	 	 	          Lawrence M. Small
	 	 	
Title:
	 	Chair, Organization & Compensation Committee


















 


Exhibit A



THE CHUBB CORPORATION




LONG-TERM STOCK INCENTIVE PLAN (2000)




RESTRICTED STOCK UNIT AGREEMENT




This Agreement dated the 1st day of December 2003:




     WHEREAS, pursuant to the provisions of The Chubb Corporation Long-Term
Stock Incentive Plan (2000) (the “Plan”), John D. Finnegan (the “Participant”)
was previously granted an award (the “Previous Award”) of 61,617 shares of
restricted stock of The Chubb Corporation (the “Corporation”), 30,809 of which
have vested; and




     WHEREAS, the Participant desires to defer until the termination of his
employment with the Corporation the settlement of the value of the 30,808
shares remaining outstanding under the Previous Award and the Corporation
desires to allow the deferral of such settlement until the termination of the
Participant’s employment with the Corporation by having the Participant forfeit
the remaining shares subject to the Previous Award in exchange for a grant of
30,808 Restricted Stock Units (the “Award”), on the terms and subject to the
conditions of this Restricted Stock Unit Agreement.




     NOW THEREFORE, the Participant and Corporation agree as follows:




	 	1.	 	Pursuant to the provisions of the Plan, the Corporation on
the date set forth above has granted and hereby evidences the grant
to the Participant, subject to the terms and conditions set forth
herein and in the Plan an award of thirty thousand eight hundred
eight (30,808) Restricted Stock Units (the “Award”). All
capitalized terms used herein which are not otherwise defined herein
shall have the meaning specified in the Plan.






	 	2.	 	It is understood and agreed that the grant of the Award
evidenced hereby is subject to the following conditions:






	 	(a)	 	Except as provided in paragraphs 4 and 5, until
settlement of the Restricted Stock Units in accordance with
paragraph 7, the Restricted Stock Units may not be sold,
hypothecated, pledged or otherwise transferred in any manner
except by will or the laws of descent and distribution or as
otherwise specifically permitted herein.






	 	(b)	 	For purposes of this Agreement, each Restricted
Stock Unit shall be treated as the equivalent of one share of
Common Stock. Until settlement of the Restricted Stock Units
in accordance with paragraph 7, the Participant shall be
entitled to receive an amount equal to the amount of dividends
paid on the number of shares of the Corporation’s Common Stock
equal to the number of the Participant’s Restricted Stock
Units. Except as otherwise provided in paragraphs 4(b), 4(c)
or 5, the Restricted







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	 		 	Stock Units covered by the Award shall be vested on December
2, 2004 (such date to be hereafter referred to as the
“Vesting Date”).






	 	(c)	 	By entering into this Agreement Participant
hereby agrees to simultaneously forfeit any and all rights
with respect to the thirty thousand eight hundred eight
(30,808) shares of Restricted Stock having a Restriction
Period ending on December 2, 2004, previously granted to
Participant on December 2, 2002.






	 	3.	 	Neither the execution and delivery hereof nor the granting of
the Award shall constitute or be evidence of any agreement or
understanding, express or implied, on the part of the Corporation or
any of its Subsidiaries to employ or continue the employment of the
Participant for any period.






	 	4.	 	Termination of Employment.






	 	(a)	 	Except as provided in subparagraph (b) and
subparagraph (c) of this paragraph 4, the Restricted Stock
Units shall be automatically forfeited upon the Participant’s
termination of employment prior to the Vesting Date. Upon any
forfeiture of Restricted Stock Units hereunder, the
Participant shall cease to have any rights in connection with
such Restricted Stock Units as of the date of such forfeiture.






	 	(b)	 	Upon termination of the Participant’s employment
for retirement on or after Participant’s Normal Retirement
Date under the Corporation’s Pension Plan, or by reason of
death or disability (as defined in such Pension Plan) of the
Participant or for any reason with the consent of the
Committee, the Participant shall be vested (or the
Participant’s Designated Beneficiary in the case of the
Participant’s death) in the number of Restricted Stock Units
equal to the number of Restricted Stock Units granted under
this Award times a fraction of the numerator of which is the
number of full calendar months from December 2, 2002 to the
date of such termination of employment and the denominator of
which is 24, and all other Restricted Stock Units shall be
forfeited, provided, however, that the Committee may determine
that the Participant (or the Designated Beneficiary) is
entitled to receive a greater number of Restricted Stock Units
up to but not exceeding the number of Restricted Stock Units
which would have been distributed had the Participant
continued to be employed until December 2, 2004.






	 	(c)	 	Upon termination of the Participant’s employment
that would give rise to benefits under Section 5(a) of the
Employment Agreement by and between the Corporation and the
Participant effective as of December 1, 2002, the Restricted
Stock Units shall vest in accordance with the terms therein.






	 	(d)	 	Transfer from the Corporation to a Subsidiary,
from a Subsidiary to the Corporation, or from one Subsidiary
to another shall not be considered a termination of
employment. Nor shall it be considered a termination of
employment if the Participant is placed on a military or sick
leave or such







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	 	 	 	other leave of absence which is considered as continuing
intact the employment relationship; in such case, the
employment relationship shall be continued until the later of
the date when the leave equals ninety days or the date when a
Participant’s right to reemployment shall no longer be
guaranteed either by law or by contract.






	 	(e)	 	Upon termination of the Participant’s employment
for any reason following the Vesting Date, Participant shall
have a non-forfeitable right to settlement of the Restricted
Stock Units in accordance with paragraph 7.






	 	5.	 	Change in Control. In the case of (i) any merger,
consolidation or combination of the Corporation with or into another
corporation (other than a merger, consolidation or combination in
which the Corporation is the continuing corporation and which does
not result in its outstanding stock being converted into or
exchanged for different securities, cash or other property, or any
combination thereof) or a sale of all or substantially all of the
business or assets of the Corporation or (ii) a Change in Control
(as defined below) of the Corporation, which occurs on or after
December 2, 2003 (any such event described in (i) or (ii) which
occurs on or after December 2, 2003 being hereinafter referred to as
a “Change Event”), Restricted Stock Units not previously forfeited
pursuant to paragraph 4 shall become vested and nonforfeitable.






	 		 	A “Change of Control” shall be deemed to have occurred if (a) any
person, or any two or more persons acting as a group, and all
affiliates of such person or persons, shall own beneficially 25% or
more of the Common Stock outstanding, or (b) following (i) a tender
or exchange offer for voting securities of the Corporation, or (ii)
a proxy contest for the election of directors of the Corporation,
the persons who were directors of the Corporation immediately
before the initiation of such event cease to constitute a majority
of the Board of Directors of the Corporation upon the completion of
such tender or exchange offer or proxy contest or within one year
after such completion.






	 	6.	 	In the event that the Committee shall determine that any
stock divided, extraordinary cash dividend, recapitalization,
reorganization, merger, consolidation, split-up, spin-off,
combination, exchange of shares, warrants or rights offering to
purchase Common Stock at a price substantially below fair market
value, or other similar corporate event affects the Common Stock
such that an adjustment is required in order to preserve the
benefits or potential benefits intended to be made available under
this Award, then the Committee shall, in its sole discretion, and in
such manner as the Committee may deem equitable, adjust any or all
of the number and kind of units (or other property) subject to this
Award and/or, if deemed appropriate, make provision for a cash
payment to the person holding this Award provided, however, that the
number of Restricted Stock Units subject to this Award shall always
be a whole number.






	 	7.	 	Settlement of Restricted Stock Units. If the Participant’s
employment is terminated (a) on or after the Vesting Date or (b) at
an earlier date upon the occurrence of an event giving rise to
vesting of the Restricted Stock Units as provided in paragraphs
4(b), 4(c) or 5, the Corporation shall be obligated to pay to







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	 		 	the Participant as soon as practicable after Participant’s
termination of employment (the “Payment Date”), an amount in cash
or shares of Common Stock, as determined in the sole discretion of
the Committee, equal to the number of such vested Restricted Stock
Units times the Fair Market Value of one share of Common Stock on
the date of such payment.






	 	8.	 	Any notice given hereunder to the Corporation shall be
addressed to The Chubb Corporation, attention Secretary, 15 Mountain
View Road, P.O. Box 1615, Warren, New Jersey 07061-1615, and any
notice given hereunder to the Participant shall be addressed to the
participant at the Participant’s address as shown on the records of
the Corporation.






	 	9.	 	The Participant agrees to be bound by the terms and
conditions hereof and of the Plan.






	 	10.	 	Cancellation and Rescission of Restricted Stock Unit Award.
The Committee may also cancel any Restricted Stock Unit Award at any
time prior to the Vesting Date, and the Corporation shall have the
additional rights set forth below in this paragraph 10, if the
Participant is not in compliance with all applicable provisions of
this Award agreement and the Plan including the following
conditions:






	 	(a)	 	A Participant shall not, without prior written
authorization from the Corporation, disclose to anyone outside
the Corporation, or use in other than the Corporation’s or any
of its Subsidiaries’ business, any confidential information or
material relating to the business of the Corporation or any of
the Corporation’s Subsidiaries that is required by the
Participant either during or after employment with the
Corporation or any of the Corporation’s Subsidiaries.






	 	(b)	 	A Participant shall not during his or her
employment with the Corporation or any of its Subsidiaries and
for a period of (1) year following any termination of such
employment relationship directly or indirectly, solicit,
persuade, encourage or induce any individual employed by the
Corporation or any of its Subsidiaries during the
above-referenced time periods to become employed by or
associated with any person or entity other than the
Corporation or any of its Subsidiaries which employs
Participant or for which Participant serves as an officer,
director, shareholder, partner or consultant, or with any firm
related to any such person or entity or to permit any other
person or entity to do so on Participant’s behalf.






	 	(c)	 	A Participant shall disclose promptly and assign
to the Corporation all right, title, and interest in any
invention or idea, patentable or not, made or conceived by the
Participant during employment by the Corporation or any of its
Subsidiaries, relating in any manner to the actual or
anticipated business, research or development work of the
Corporation or any of its Subsidiaries and shall do anything
reasonably necessary to enable the Corporation or any of its
Subsidiaries to secure a patent, copyright or any







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	 	 	 	other intellectual property rights where appropriate in the
United States and in foreign countries.






	 	(d)	 	Failure to comply with the provisions of this
paragraph 10 through the Vesting Date pursuant to this
Restricted Stock Unit Award shall cause the Restricted Stock
Unit Award to be rescinded, however, the Corporation may, in
its discretion, provide for waiver in whole or in part of
compliance with the provisions of this paragraph 10.






	 	11.	 	Governing Law. The Award and the legal relations between the
parties shall be governed by and construed in accordance with the
internal laws of the State of New York.






	 	12.	 	Signature in Counterpart. This Agreement may be signed in
counterparts, each of which shall be an original, with the same
effect as if the signature thereto and hereto were upon the same
instrument.






     IN WITNESS WHEREOF, the Corporation by its duly authorized officer, and
the Participant have executed this Agreement in duplicate as of the day and
year first above written.




	 	 	 	 	 
	 	 	 	 	 
	 	 	 	 	THE CHUBB CORPORATION
	 	 	 	 	 
	 	 	 	 	 
	 	 	
By:	 	 
	 	 	 	 	

	 	 	 	 	Secretary
	 	 	 	 	 
	 	 	 	 	 
	 	 	
By:	 	 
	 	 	 	 	

	 	 	 	 	John D. Finnegan








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Exhibit B




	 	 	 	 	 
	 	 	
THE CHUBB CORPORATION
	 	Restricted Stock Award
	 	 	
LONG-TERM STOCK	 	 
	 	 	
INCENTIVE PLAN (2000)	 	 






	1.	 	Pursuant to the provisions of The Chubb Corporation Long-Term Stock
Incentive Plan (2000) (the “Plan”), The Chubb Corporation (the
“Corporation”) on the date set forth below granted and hereby evidences
the grant to John D. Finnegan (the “Participant”), subject to the terms
and conditions set forth herein and in the Plan, a Restricted Stock Award
(the “Award”) of 31,270 shares of Restricted Stock (“Restricted Shares”).
All capitalized terms used herein which are not otherwise defined herein
shall have the meaning specified in the Plan.





	2.	 	It is understood and agreed that the grant of Restricted Shares evidenced
hereby is subject to the following conditions:





	 	(a)	 	Except as provided in paragraph 4 and 5, the Restriction Period
for this Award is the three-year period ending March 6, 2006.
Certificates evidencing the Restricted Shares shall be issued by the
Corporation and registered in the name of the Participant on the stock
transfer books of the Corporation but during the Restriction Period,
such certificates shall bear an appropriate legend, such legend to be
removed only if, and when, the Restriction Period ends as provided
herein. As a condition to receiving this Award, Participant shall
deliver to the Corporation the attached stock power duly endorsed in
blank. Notwithstanding the above, the Participant shall be entitled to
exercise all rights, except the rights specifically prohibited by
paragraph 2(c), otherwise held by an owner of a share of Common Stock,
including the right to receive free of restrictions all cash dividends
paid on such Common Stock.






	 	(b)	 	In order to comply with any applicable securities laws, the
Corporation may require the Participant (i) to furnish evidence
satisfactory to the Corporation (including a written and signed
representation letter) to the effect that all Restricted Shares were
acquired for investment only and not for resale or distribution and
(ii) to agree that all Restricted Shares shall only be sold by the
Participant following registration under the Securities Act of 1933 or
pursuant to an exemption therefrom.






	 	(c)	 	During the Restriction Period, the Restricted Shares may not be
sold, hypothecated, pledged or otherwise transferred in any manner
except by will or the laws of descent and distribution or as otherwise
specifically permitted herein.






	3.	 	The Award shall not constitute or be evidence of any agreement or
understanding, express or implied, on the part of the Corporation or any
of its subsidiaries to employ or continue the employment of the
Participant for any period.





	4.	 	Termination of Employment.





	 	(a)	 	Except as provided in subparagraph (b) of this paragraph 4, the
Restricted Shares shall be automatically forfeited upon the
Participant’s termination of employment during the Restriction Period.
Upon any forfeiture of Restricted Shares hereunder, ownership of such
shares shall be transferred to the Corporation and the Participant
shall cease to have any ownership interest in such shares as of the
date of such forfeiture.






	 	(b)	 	Upon termination of the Participant’s employment for retirement
on or after Participant’s Normal Retirement Date under the
Corporation’s Pension Plan, or by reason of death or disability (as
defined in such Pension Plan) of the Participant or for any reason
with the consent of the Committee, there shall be distributed to the
Participant (or the Participant’s Designated Beneficiary in the case
of the Participant’s death) the number of Restricted Shares equal to
the number of Restricted Shares times a fraction the numerator of
which is the number of full calendar months from March 6, 2003 to the
date of such termination of employment and the denominator of which is
36, and all other Restricted Shares shall be forfeited, provided
however, that the Committee may determine that the Participant (or the
Designated Beneficiary) is entitled to receive a greater number of
Restricted Shares up to but not exceeding the number of Restricted
Shares which would have been distributed had the Participant continued
to be employed until March 6, 2006.







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	 	(c)	 	Transfer from the Corporation to a Subsidiary, from a Subsidiary to the
Corporation, or from one Subsidiary to another shall not be considered
a termination of employment. Nor shall it be considered a termination
of employment if the Participant is placed on a military or sick leave
or such other leave of absence which is considered as continuing intact
the employment relationship; in such a case, the employment
relationship shall be continued until the later of the date when the
leave equals ninety days or the date when a Participant’s right to
reemployment shall no longer be guaranteed either by law or by
contract.






	5.	 	Mergers, Sales and Change of Control. In the case of (i) any merger,
consolidation or combination of the Corporation with or into another
corporation (other than a merger, consolidation or combination in which
the Corporation is the continuing corporation and which does not result in
its outstanding stock being converted into or exchanged for different
securities, cash or other property, or any combination thereof) or a sale
of all or substantially all of the business or assets of the Corporation
or (ii) a Change in Control (as defined below) of the Corporation, which
occurs on or after March 6, 2004 (any such event described in (i) or (ii)
which occurs on or after March 6, 2004 being hereinafter referred to as a
“Change Event”), Restricted Shares not previously forfeited pursuant to
paragraph 4 shall become vested and nonforfeitable according to the
following schedule: As of the date of the Change Event, 33 1/3% of the
Restricted Shares shall be vested and an additional 33 1/3% or 66 2/3% of
the Restricted Shares will be vested as of such date if such date is on or
after March 6, 2005 respectively. For any Restricted Shares not vested in
accordance with the above rule on the date of the Change Event, such
Restricted Shares shall become vested at the rate of 33 1/3% for each 12
month period which elapses from the date of the Change Event to the
Participant’s termination of employment, provided, however, that all
remaining Restricted Shares not yet vested upon the Participant’s
termination of employment shall become immediately vested if Participant’s
employment is terminated involuntarily after the date of the Change Event,
or if the Participant voluntarily ceases to be employed after the
Participant’s job responsibilities or duties have been diminished or the
location of the Participant’s place of employment by the Corporation (or
its successor) has been relocated more than 35 miles, provided, further,
that the vesting under this paragraph 5 shall in no event result in fewer
Restricted Shares being vested upon the Participant’s termination of
employment than would result under paragraph 4.





	 	 	A “Change in Control” shall be deemed to have occurred if (a) any person,
or any two or more persons acting as a group, and all affiliates of such
person or persons, shall own beneficially 25% or more of the Stock
outstanding, or (b) if following (i) a tender or exchange offer for voting
securities of the Corporation, or (ii) a proxy contest for the election of
directors of the Corporation, the persons who were directors of the
Corporation immediately before the initiation of such event cease to
constitute a majority of the Board of Directors of the Corporation upon the
completion of such tender or exchange offer or proxy contest or within one
year after such completion.





	6.	 	In the event that the Committee shall determine that any stock dividend,
extraordinary cash dividend, recapitalization, reorganization, merger,
consolidation, split-up, spin-off, combination, exchange of shares,
warrants or rights offering to purchase Common Stock at a price
substantially below fair market value, or other similar corporate event
affects the Common Stock such that an adjustment is required in order to
preserve the benefits or potential benefits intended to be made available
under this Award, then the Committee shall, in its sole discretion, and in
such manner as the Committee may deem equitable, adjust any or all of the
number and kind of shares subject to this Award and/or, if deemed
appropriate, make provision for a cash payment to the person holding this
Award provided, however, that the number of Restricted Shares subject to
this Award shall always be a whole number.





	7.	 	Any notice given hereunder to the Corporation shall be addressed to The
Chubb Corporation, attention Secretary, 15 Mountain View Road, P.O. Box
1615, Warren, New Jersey 07061-1615, and any notice given hereunder to the
Participant shall be addressed to the Participant at the Participant’s
address as shown on the records of the Corporation.





	8.	 	The Participant agrees to be bound by the terms and conditions hereof and
of the Plan.





	9.	 	Cancellation and Rescission of Restricted Stock Award. The Committee may
also cancel any Restricted Stock Award at any time, and the Corporation
shall have the additional rights set forth below in this paragraph 9, if






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	 	 	the Participant is not in compliance with all applicable provisions of this
Award agreement and the Plan including the following conditions:





	 	(a)	 	A Participant shall not, without prior written authorization from
the Corporation, disclose to anyone outside the Corporation, or use in
other than the Corporation’s or any of its subsidiaries’ business, any
confidential information or material relating to the business of the
Corporation or any of the Corporation’s subsidiaries that is acquired
by the Participant either during or after employment with the
Corporation or any of the Corporation’s subsidiaries.
(b) Participant shall not during his or her employment with the
Corporation or any of its subsidiaries and for a period of one (1)
year following any termination of such employment relationship
directly or indirectly solicit, persuade, encourage or induce any
individual employed by the Corporation or any of its subsidiaries
during the above-referenced time periods to become employed by or
associated with any person or entity other than the Corporation or any
of its subsidiaries which employs Participant or for which Participant
serves as an officer, director, shareholder, partner or consultant, or
with any firm related to any such person or entity or to permit any
other person or entity to do so on Participant’s behalf.






	 	(c)	 	A Participant shall disclose promptly and assign to the
Corporation all right, title, and interest in any invention or idea,
patentable or not, made or conceived by the Participant during
employment by the Corporation or any of its subsidiaries, relating in
any manner to the actual or anticipated business, research or
development work of the Corporation or any of its subsidiaries and
shall do anything reasonably necessary to enable the Corporation or
any of its subsidiaries to secure a patent, copyright or any other
intellectual property rights where appropriate in the United States
and in foreign countries.






	 	(d)	 	Failure to comply with the provisions of this paragraph 9 prior
to, or during the six months after, the end of the Restriction Period
pursuant to the Restricted Stock Award shall cause the Restricted
Stock Award to be rescinded. The Corporation shall notify the
Participant in writing of any such rescission within two years after
the end of the Restricted Period provided, however, that the
Corporation may, in its discretion, in any individual case provide for
waiver in whole or in part of compliance with the provisions of this
paragraph 9. Within ten days after receiving such a notice from the
Corporation, the Participant shall pay to the Corporation the amount
of any gain realized or payment received as a result of the rescission
of the Restricted Stock Award. Such payment shall be made either in
cash and/or by returning to the Corporation the number of shares of
Stock that the Participant received in connection with the rescinded
Restricted Stock Award.






     10. Governing Law. The Award and the legal relations between the parties
shall be governed by and construed in accordance with the internal laws of
the State of New York.




	 	 	 	 	 
	 	 	THE CHUBB CORPORATION
	 	 	 	 	 
	 	 	
By
	 	 
	 	 	 	 	

	 	 	 	 	Secretary
	 	 	 	 	 
	 	 	
Date:
	 	 
	 	 	 	 	









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