Document:

EMPLOYMENT AGREEMENT

     EMPLOYMENT AGREEMENT (this "Agreement") made as of _____ day of March,
2000, by and between THE BANK OF SOMERSET HILLS, a New Jersey state chartered
commercial bank ("Employer" or the "Bank"), and JOSEPH M. SULLIVAN, an
individual residing at _____________ (the "Executive").

                              W I T N E S S E T H:

     WHEREAS, pursuant to that certain Exchange Agreement (the "Exchange
Agreement") by and among the Bank, Executive and Sullivan Financial Services,
Inc. (the "Company") the Bank is acquiring from Executive all of the common
stock of the Company, to operate as a wholly-own subsidiary of the Bank;

     WHEREAS, Executive is the Chief Executive Officer of the Company, and his
continued services are crucial to the continued success of Company's operation
as a subsidiary of the Bank;

     WHEREAS, the Bank desires to retain the Executive's services, and Executive
wishes to continue his employment with the Company on the terms and conditions
contained herein;

     NOW, THEREFORE, in consideration of the mutual promises and undertakings
herein contained, the parties hereto, intending to be legally bound, agree as
follows:

     1. Employment and Term.

     (a) Employer hereby employs the Executive as President of the Company (the
"Position") and the Executive agrees, subject to the termination provisions
hereof, to serve as President and Chief Executive Officer of the Company, for a
term of three years (the "Term"),

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which shall commence on the date hereof (the "Effective Date"), and which,
subject to paragraphs 1(b), and (c), hereof, shall terminate on the third
anniversary of the Effective Date; unless extended by the mutual agreement of
Executive and Employer.

     (b) Employer shall have the right to terminate the Executive's employment
hereunder prior to the third anniversary of the Effective Date; provided,
however, that unless such termination is for "cause", as defined below,
Executive shall be entitled to receive his Base Salary (as defined herein) and
all insurance benefits provided on the date of such termination for the
remaining term of this Agreement and his Bonus (as defined herein) up through
the date of such termination; provided, however, that for purposes of
determining whether Executive is entitled to any Bonus upon such termination and
thereafter, the Company's net income for the year of termination, calculated in
accordance with Section 3(a), will be measured by using expenses accrued or
incurred to date (and pro rated if such expenses have been prepaid for a year)
against a pro rata portion of the Target (as defined herein), giving effect to
the number of months which have transpired up until such termination. Such
payments shall be made in accordance with Employer's normal payroll practices.
If such termination is for "cause", Executive shall not be entitled to receive
any compensation from and after the date of such termination; provided, however,
that Executive shall be entitled to his Base Salary and any benefits due for
periods, or partial periods, that occurred prior to the date of termination and
for which Executive has not yet been paid. For purposes of this Agreement,
"cause" means (i) the Executive's willful and continued failure substantially to
perform the duties of the Position, (ii) fraud, material misappropriation or
other deliberate dishonesty of Executive with respect to

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Employer's business or property, (iii) the Executive's plea of guilty to or
conviction of, or plea of nolo contendere to, any felony that adversely affects
Employer's reputation or the Executive's ability to perform his duties
hereunder; or (iv) Executive's willful violation of (A) any law, rule or
regulation materially effecting the business of Employer, or (B) final
cease-and-desist order issued by or regulatory consent agreement with any
regulatory agency having jurisdiction over the Bank or the Company. Executive
shall have the right to cure any alleged acts, conditions or events which
Employer believes constitute "cause" under subparagraph (i) above, within thirty
(30) days of his receipt of written notice specifying in reasonable detail such
acts, conditions or events, and such specific acts, conditions or events if so
remedied, shall not then constitute "cause."

     (c) In order for Employer to terminate Employee's employment hereunder for
"cause", Employer shall:

          (i) Transmit written notice (the "Initial Notice") to Executive of
     Employer's determination of the existence of cause, specifying the nature
     of the conduct or event constituting cause. If the grounds for cause shall
     be pursuant to subparagraph (b)(ii), (iii) or (iv) set forth above,
     Executive shall be immediately suspended from his duties hereunder and
     shall have no right to access to the premises of either the Employer or the
     Company. In the event the alleged grounds for cause are those set forth
     under subparagraph (b)(i) above, Executive shall have thirty (30) days to
     cure such alleged cause, assuming the cause is curable, as set forth in
     paragraph (b) above. If Executive disputes Employer's determination as to
     the existence of cause as set forth in the Initial Notice, the Executive
     shall, within ten (10) days of receipt of the Initial

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     Notice, transmit a written notice (the "Second Notice") of his intention to
     contest such termination to the Employer. Within five (5) days of the
     receipt of the Second Notice, Employer shall either (i) transmit written
     notice ("Third Notice") to Executive withdrawing, in all respects, the
     Initial Notice and the purported termination of this Agreement or (ii)
     submit the issue of whether cause exists to arbitration as provided below.

          (ii) Executive's employment hereunder shall be suspended as provided
     for under subparagraph (i) above from either the date of the Initial Notice
     or thirty (30) days thereafter (assuming the cause is not cured) as
     provided under paragraph (i) above until such time as the Arbitrator called
     for under paragraph (d) renders a definitive decision. During the time of
     such suspension, Employer shall not be required to pay to Executive any
     compensation to which he would have otherwise been entitled under Section 3
     hereof but rather Employer shall place into escrow such cash compensation;
     provided, however, that during the term of such suspension, Employer shall
     maintain in full force and effect all policies of insurance covering
     Executive in effect as of the date of such suspension for the benefit of
     the Executive. In the event an Arbitrator shall rule that cause did not
     exist for Executive's termination, the Arbitrator shall be limited in his
     award to Executive to directing the payment over to Executive of amounts in
     the escrow account. In the event the Arbitrator rules that cause did exist
     to terminate Executive, Employer shall be refunded all funds in the escrow
     account and the Arbitrator shall not be entitled to award other damage;
     provided, however, that this provision shall not prohibit the Bank from
     initiating an action to seek restitution in the event of fraud or
     embezzlement by Executive.

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     (d) In the event that Employer and Executive do not agree on the issue of
whether cause exists to terminate this Agreement as set forth in an Initial
Notice, the dispute shall be submitted to arbitration in accordance with the
Rules of the American Arbitration Association then obtaining. Such arbitration
shall be held in the County of Essex, State of New Jersey (or next closest site
should there be no AAA location in Essex County) before an Arbitrator familiar
with the banking industry and the decision of the Arbitrator shall be binding
and the award of the Arbitrator shall be enforceable in any court of competent
jurisdiction. The Arbitrator shall be limited in his or her award in the manner
set forth in subparagraph (c)(ii) above, and the Arbitrator shall also award
costs, including attorney's fees, to the prevailing party, to be paid by the
non-prevailing party.

     (e) This Agreement shall terminate upon Executive's death or his
disability, as defined herein. Upon Executive's death or his disability, the
obligation of Employer hereunder to pay Executive the compensation called for
under Section 3 hereof shall terminate, and Employer's only obligation shall be
to pay Executive any and all benefits to which Executive was entitled at the
time of such death or determination by the Panel of disability under any benefit
plans of Employer then in place. For purposes of this Agreement, the term
"disability" shall mean Executive's inability to substantially perform his
material duties as prescribed in this Agreement due to his incapacity or
disability, physical or mental, for a period of six (6) consecutive months,
which, following a written request by either Employer or Executive, shall be
determined by agreement between the parties hereto and, if the parties cannot
agree, by a panel (the "Panel") of three (3) physicians, one of whom will be
selected by Employer, one by Executive and the third will be selected by the
first two physicians so selected. Executive shall

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be entitled to receive his full salary and benefits under this Agreement until
the date of the Panel's determination and his Bonus prorated to the date of such
determination or his death, provided Executive would have been entitled to a
bonus based upon his pro rata achievement of the Target. The Panel's
determination shall be conclusive.

     (f) Notwithstanding paragraph (a) hereof, Executive may resign from the
Position, and have no further obligations under this Agreement, other than those
contained in Section 4(a) hereunder, upon the occurrence of any of the following
events:

          (i) Employer shall have breached any of its duties or obligations to
     Executive pursuant to this Agreement or pursuant to the Exchange Agreement
     by means of, among other things, causing a material reduction in
     Executive's status, authority, responsibility or standing with the Company
     or by reducing Executive's Base Salary (as defined herein), failing to pay
     Executive any bonus to which he is entitled hereunder, or reducing
     Executive's fringe benefits, such as insurance or other benefits, unless
     such reduction in fringe benefits is part of an overall reduction effecting
     all executive officers of the Bank; provided, however, that Executive shall
     not be entitled to terminate this Agreement until such time as he has
     provided Employer with written notice of any alleged breach and Employer
     has failed to cure such breach within thirty (30) days of receipt of such
     notice; further provided, however, that in the event that any alleged
     breach is of a type which cannot be cured during such thirty (30) day
     period, Executive shall not have the right to terminate this Agreement so
     long as Employer is making its best efforts to remedy such breach within
     thirty (30) days of receipt of Executive's notice and continues to use such
     best efforts thereafter and such breach is ultimately cured within 75 days
     of such notice;

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          (ii) A "change in control of the Bank" (as such term is defined under
     Section 1.2(b) of the Exchange Agreement), shall have occurred and within
     six (6) months there shall occur (a) a material reduction in Executive's
     status, authority, responsibility or standing within the resulting entity,
     (b) Executive's compensation, including the Bonus or fringe benefits, such
     as insurance or other benefits, shall be materially reduced; or (c)
     Executive's principal place of business is relocated by more than thirty
     (30) miles from its location prior to the change in control;

          (iii) The relocation of Employer's principal place of business in
     which Executive usually performs his job duties to a location more than
     thirty (30) miles from its current location as of the date of this
     Agreement, without Executive's written consent; provided, however, that
     Executive acknowledges that he may be required to work at Employer's
     Bernardsville, New Jersey headquarters and that this will not be considered
     a relocation of Executive's location hereunder;

          (iv) The appointment of a receiver or conservator for the Bank by the
     Federal Deposit Insurance Corporation or the New Jersey Department of
     Banking and Insurance; or

          (v) Failure by Employer to provide the Company with sufficient capital
     to remain approved as a lender by the Department of Veteran's Affairs and
     the Department of Housing and Urban Development.

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     In the event of any such resignation under this Section 1(f), Executive
shall be entitled to receive his Base Salary and Bonus as if he had been
terminated without cause under Section 1(b).

     In the event Employer disputes whether Executive has the right to resign
under this Section 1(f), such matter shall be submitted to arbitration in
accordance with Sections 1(c) and (d) hereof, except that the notification
provisions shall be reversed with Executive giving the Initial Notice and
Employer responding.

     (g) Executive shall be entitled to indemnification from the Bank to the
fullest extent provided for under the Bank's bylaws as currently constituted or
amended provided that any amendment will not reduce the protection afforded to
Executive.

     2. Duties.

     (a) Subject to the ultimate reasonable control and discretion of the Board
of Directors of Employer, the Executive shall serve in the Position and perform
all duties and services as President and Chief Executive of the Company and
shall have full authority and responsibility to undertake and carry out the
functions and activities of the Position.

     (b) The Executive shall devote all of the Executive's professional time and
attention to the performance of the Executive's duties hereunder and, during the
term of the Executive's employment hereunder, shall not engage in any other
business enterprise which requires more than five hours per week of the
Executive's personal time or attention, unless granted the prior permission of
the Board. The foregoing shall not prevent the Executive's purchase, ownership
or sale of investment securities or of any interest in, any business which
competes with the business of Employer (although, prior to the termination of
this Agreement,

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Executive shall not be allowed to actively participate in the management or
operation of such enterprise), provided that such ownership or investment
constitutes not more than five percent of the outstanding shares of a
corporation whose stock is listed on a National Securities Exchange or on the
National Association of Securities Dealers Automated Quotation System, or the
Executive's involvement in charitable or community activities, provided that the
time and attention which the Executive devotes to such activities does not
materially interfere with the performance of the Executive's duties hereunder.

     3. Compensation.

     (a) For all services to be rendered by the Executive under this Agreement,
Employer agrees to pay the Executive as follows: (i) a salary of $125,000
annually, to be paid in accordance with the Bank's existing payroll policies
(the "Base Salary"); (ii) a bonus (the "Bonus") to be paid annually, equal to
1/3 of the amount by which the net income of the Company as a subsidiary of the
Bank for each year of operation (which may be less than twelve (12) months in
the year of Closing) after the Date of Closing exceeds $180,000 on an annual
basis, or such appropriate pro rated amount (the "Target"). The net income of
the Company shall be determined consistent with generally accepted accounting
principals, but shall exclude the impact of the amortization of the good will
and other depreciation, acquisition or amortization expenses created by the
Bank's acquisition of the Company pursuant to the Exchange Agreement. In
calculating the net income of the Company, the Bank shall pass through to the
Company only those administrative expenses incurred by the Bank on behalf of the
Company directly related to the operations of the Company for such items as
bookkeeping,

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human resources administration, payroll and like administrative services. Except
at set forth herein, no Bank general and administrative expenses will be charged
against the Company's net income for determining the Bonus. Such administrative
charges will be passed through to the Company at the Bank's cost, without any
markup or profit. All extensions of credit from the Bank to the Company, such as
by means of a warehouse line of credit or otherwise, will be upon arm's length
terms and shall have rates and charges comparable to those otherwise available
to the Company from unaffiliated, third party lenders at fully phased in,
non-discounted or non-promotional rates. Should Executive believe that any such
interest fees and expenses are in excess of the rates and fees available from
unaffiliated third parties, Executive shall have the right to obtain commitments
from unaffiliated, third party financial institutions to offer substantially
similar credit products to the Company. The Bank may either (i) reduce the
interest fees and expenses assessed against the Company to match the rates
offered by such unaffiliated financial institution as reflected in such
commitment, or (ii) permit the Company to obtain its credit products from the
unaffiliated financial institution. The amount of the Bonus, if any, will be
determined based upon the Bank's audited financial statements and will be paid
within thirty (30) days of the release of such statements.

     (b) In addition to the compensation provided for under subparagraph (a)
hereof, Executive shall be entitled to receive insurance of the type provided
under the Bank's existing and future benefit plans available to Employer's
executive employees generally. Exhibit A hereto contains a listing of the
current insurance and benefit plans offered by Employer.

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     4. Additional Covenants.

     (a) Confidential Information. Except as required in the performance of his
duties hereunder, the Executive shall not use or disclose to any third party any
Confidential Information (as hereinafter defined) or any know-how or experience
related thereto without the express prior written authorization of Employer,
either during the term of this Agreement or thereafter. Upon termination of his
employment, the Executive shall leave with Employer all documents and other
items in his possession which contain Confidential Information, and shall be
prohibited from disclosing to any third party any Confidential Information. For
purposes of this paragraph 4(a), the term "Confidential Information" shall mean
all information about Employer and the Company or relating to any of its
services or any phase of its operations not generally known to any of its
competitors and which is treated by Employer or the Company as confidential
information, and shall specifically include all customer lists of Employer and
Company.

     The term "Confidential Information" shall not include any of the foregoing
which (i) is in the public domain, (ii) is in Executive's lawful possession
prior to a disclosure thereof and not subject to a confidentiality agreement or
(iii) is hereafter lawfully disclosed to Executive by a third party who or which
did not acquire the information under an obligation of confidentiality to
Employer.

     (b) Non-Compete. Executive hereby agrees that during the term of this
Agreement and, for a period of six (6) months following the termination of
Executive's employment hereunder, only to the extent that such termination is
initiated by Employer with cause under Section 1(b) or by Executive other than
pursuant to Section 1(f) (the "Covenant

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Term"), he will not work for any entity which is engaged in the residential
mortgage origination business in geographic areas served by Employer as of the
Term of this Agreement and as of the date of its termination nor himself so
engage during such Covenant Term, directly or indirectly, as principal, agent,
partner, shareholder, consultant, or employee, in any such business and further
that during such period he will not directly or indirectly solicit, cause any
other person to solicit, or assist any other person with soliciting any
customer, depositor or borrower of Employer to become a customer, depositor or
borrower of another financial institution. Executive further agrees that during
the term of his employment and during the Covenant Term, he will not directly or
indirectly participate in the solicitation of any person, entity, customer or
client having a relationship with Employer prior to or during the Covenant Term.

     (c) Non-Solicitation. Executive agrees that for a period of six (6) months
following the termination of this Agreement, he will not recruit for employment
or induce to terminate his or her employment with Employer any person who is, at
the time of such solicitation, or who was within thirty (30) days of such
solicitation, an employee of Employer.

     (d) Modification. If a court of competent jurisdiction determines that the
scope, time duration or other limitations of any of the restrictive covenants
contained in this Section 4 is not reasonably necessary to protect the
legitimate business interests of Employer, then such scope, time duration or
other limitations will be deemed to become and thereafter will be the maximum
time period or scope which such court deems reasonable and enforceable.

     (e) Definitions. For purposes of this Section 4, to act "directly or
indirectly" means to act personally or through an associate, affiliate, family
member or otherwise, as proprietor,

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partner, shareholder, director, officer, employee, agent, consultant or in any
other capacity or manner whatsoever.

     (f) Specific Performance. Employer and the Executive agree that in the
event of a breach of the provisions of this Section 4 the injury which would be
suffered by Employer would be of a character which could not be fully
compensated for solely by a recovery of monetary damages. Accordingly, Executive
agrees that in the event of a breach of the terms of this Section 4, in addition
to and not in lieu of any other remedies which Employer may pursue, Employer
shall have the right to equitable relief, including issuance of a temporary or
permanent injunction by any court of competent jurisdiction against the
commission or continuance of any breach of this Section 4.

     5. Notices. Any and all notices, demands or requests required or permitted
to be given under this Agreement shall be given in writing and sent, (i) by
registered or certified U.S. mail, return receipt requested, (ii) by hand, (iii)
by overnight courier or (iv) by telecopier addressed to the parties hereto at
their addresses set forth above or such other addresses as they may from
time-to-time designate by written notice, given in accordance with the terms of
this Section, together with copies thereof as follows:

     In the case of Executive, with a copy to:

         Marc D. Freedman, Esq.
         Freedman & Stone
         777 Terrace Avenue
         Hasbrouck Heights, New Jersey 07604
         Telecopier: (201) 288-7009

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     In the case of Employer, with a copy to:

         Jamieson, Moore, Peskin & Spicer, P.C.
         177 Madison Avenue
         Morristown, New Jersey 07960
         Telecopier No. (973) 984-9549
         Attention: Robert A. Schwartz

     Notice given as provided in this Section shall be deemed effective: (i) on
the date hand delivered, (ii) on the first business day following the sending
thereof by overnight courier, (iii) on the seventh calendar day (or, if it is
not a business day, then the next succeeding business day thereafter) after the
depositing thereof into the exclusive custody of the U.S. Postal Service or (iv)
on the date telecopied.

     6. Assignability. The services of the Executive hereunder are personal in
nature, and neither this Agreement nor the rights or obligations of Executive
hereunder may be assigned, whether by operation of law or otherwise. This
Agreement shall be binding upon, and inure to the benefit of, Employer and its
Successors and assigns. Employer may not assign this Agreement without the
written consent of Executive. No merger, consolidation, combination or like
transaction involving Employer shall be deemed an assignment hereunder, whether
or not Employer is the surviving entity. This Agreement shall inure to the
benefit of the Executive's heirs, executors, administrators and other legal
representatives.

     7. Waiver. The waiver by Employer or the Executive of a breach of any
provision of this Agreement by the other shall not operate or be construed as a
waiver of any subsequent or other breach hereof.

     8. Applicable Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of New Jersey without giving effect to
principles of conflict of laws.

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     9. Entire Agreement. This Agreement contains the entire agreement of the
parties hereto with respect to the subject matter hereof and may not be amended,
waived, changed, modified or discharged, except by an agreement in writing
signed by the parties hereto.

     10. Counterparts. This Employment Agreement may be executed in two or more
counterparts, each of which shall be deemed an original but all of which taken
together shall constitute one and the same instrument.

     11. Amendment. This Employment Agreement may be modified or amended only by
an amendment in writing signed by both parties.

     12. Severability. If any provision of this Employment Agreement shall be
held invalid or unenforceable, such invalidity or unenforceability shall attach
only to such provision, only to the extent it is invalid or unenforceable, and
shall not in any manner affect or render invalid or unenforceable any other
severable provision of this Agreement, and this Agreement shall be carried out
as if any such invalid or unenforceable provision were not contained herein.

     13. Section Headings. The headings contained in this Agreement are solely
for convenience of reference and shall be given no effect in the construction or
interpretation of this Employment Agreement.

     14. Fees and Expenses. If any party to this Employment Agreement institutes
any action or proceeding to enforce this Employment Agreement, the prevailing
party in such action or proceeding shall be entitled to recover from the
non-prevailing party all legal costs and expenses incurred by the prevailing
party in such action, including, but not limited to, reasonable attorneys' fees
and other reasonable legal costs and expenses.

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     IN WITNESS WHEREOF, the parties hereto have executed this Agreement under
their respective hands and seals as of the day and year first above written.

ATTEST:                              THE BANK OF THE SOMERSET HILLS

                                     By:
---------------------------             --------------------------------
                                          DENNIS C. LONGWELL
                                          President and Chief Executive Officer

WITNESS:                             EXECUTIVE:

---------------------------          -----------------------------------
                                          JOSEPH M. SULLIVAN

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<PAGE>

                                  AMENDMENT #1
                                       TO
                              EMPLOYMENT AGREEMENT

     This AMENDMENT #1 TO EMPLOYMENT AGREEMENT (this "Amendment") made as of
this 1st day of August, 2002, by and between SOMERSET HILLS BANK, f/k/a The Bank
of the Somerset Hills, a New Jersey state chartered commercial bank ("Employer"
or the "Bank") and JOSEPH M. SULLIVAN, an individual, residing at 58 Nicole
Drive, Denville, New Jersey 07834 (the "Executive").

                              W I T N E S S E T H:

     WHEREAS, pursuant to that certain Employment Agreement dated as of March
13, 2002 ("Employment Agreement") executed by and between the Bank and the
Executive, the Executive has been employed as the President and Chief Executive
Officer of Sullivan Financial Services, Inc. (the "Company"), a wholly-owned
subsidiary of the Bank; and

     WHEREAS, the Bank and the Executive desire to modify the terms of the
Employment Agreement for the purposes set forth herein.

     NOW, THEREFORE, in consideration of the mutual promises and undertakings
herein contained, the parties hereto, intending to be legally bound, agree as
follows:

     1. (paragraph)1 Employment and Term shall be modified as follows:

          (a) The Term is hereby extended to August 1, 2004 and shall continue
     unless and until either party gives the other at least twelve (12) month's
     prior written notice of termination ("Notice of Termination"), which Notice
     of Termination may be given at any time after August 1, 2003. If a proper
     Notice of Termination is sent, then effective on the date of termination
     provided in the Notice of Termination ("Termination Date"), the Employment
     Agreement shall terminate without any liability of the parties hereto to
     the other except for the performance of their respective obligations under
     the Employment Agreement and other obligations owed and arising out of the
     employment relationship that may be imposed and/or required by applicable
     law. All such notices shall be sent as provided in the Employment Agreement
     as amended by this Amendment.

          (b) Paragraph 1(b) shall be modified as follows:

               "Employer shall have the right to terminate the Executive's
          employment hereunder prior to August 1, 2004, or the Termination Date,
          as applicable; provided, however, that unless such termination is for
          "cause", as defined below, Executive shall be entitled to receive (i)
          his Base Salary (as defined herein) and all insurance benefits
          provided on the date of such termination through August 1, 2004, or
          the Termination Date, as applicable, and (ii) his Bonus (as defined
          herein) up through his last working day of employment, which day shall
          be determined by the Employer."

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<PAGE>

     2. (paragraph)2 Duties shall be modified as follows:

          The Board has designated the CEO of the Bank as its representative for
     administrative and operational purposes and any direction from the CEO
     should be considered by Executive to be direction from the Board of
     Directors. Executive shall report directly to the CEO of the Bank unless
     notified otherwise in writing.

     3. (paragraph)3 Compensation shall be modified as follows:

          (a) Subparagraph (a)(ii) regarding the calculation of the Bonus shall
     be deleted in its entirety and the following shall be inserted in lieu
     thereof:

               (ii) A bonus (the "Bonus") to be paid annually equal to one-third
          of the amount by which the sum of (A) the "Net Income" of the Company
          as a subsidiary of the Bank for each year of operation (or relevant
          portion thereof) and (B) any management fee accrued for such year,
          exceeds $180,000 on an annual basis, or such appropriate pro-rata
          amount (the "Target").

               For purposes of this calculation, "Net Income" shall mean the
          actual net income before taxes as shown on a bonus calculation
          statement prepared and approved by the Bank (a form of bonus
          calculation statement is attached hereto as Schedule A) plus any bonus
          accrual shown on said statement (which accrual shall include payroll
          related taxes, as applicable) minus any and all federal and state
          taxes calculated at the then highest applicable rates (e.g., currently
          34% and 9%, respectively) as if said taxes were paid in full and
          regardless of whether paid at all.

          (b) Delete the last sentence in paragraph (a) and insert the following
     in lieu thereof:

               "The amount of the Bonus, if any, will be determined as stated
          above and will be paid within thirty (30) days of the release of the
          Bank's annual audited financial statements."

     4. (paragraph)4 Additional Covenants:

          (a) Add the following to the end of Paragraph 4(b):

               "Notwithstanding anything contained herein to the contrary, the
          foregoing noncompete provision shall also apply for a period of six
          (6) month's following the last payment made by the Bank to Executive
          following the termination of Executive's employment as provided under
          Paragraph 1(b) of this Employment Agreement."

          (b) Delete (paragraph)4(c) in its entirety and inset in lieu thereof
     the following:

               "(c) Non-Solicitation. Executive agrees that for a period of six
          (6) months following August 1, 2004, or the Termination Date, as
          appropriate, he will not directly or indirectly recruit or solicit for
          employment or induce to terminate his or her employment or
          relationship with Employer or the Company any person who is, at the
          time of such solicitation, or who was within thirty (30) days of such
          solicitation, an employee or independent contractor of Employer or the
          Company."

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     5. (paragraph)5 Notices shall be revised to reflect the following new
addresses for the parties:

          If to Employer:           Somerset Hills Bank
                                    155 Morristown Road
                                    Bernardsville, New Jersey   07924
                                    Attention:  CEO

          with a copy to:           McElroy, Deutsch & Mulvaney, LLP
                                    1300 Mount Kemble Avenue
                                    P.O. Box 2075
                                    Morristown, New Jersey   07962-2075
                                    Attention:  Kevin P. Galvin, Esq.

          If to Executive:          Joseph M. Sullivan
                                    58 Nicole Drive
                                    Denville, New Jersey 07834

     6. Modification. All other terms and conditions of the Employment Agreement
shall remain in full force and effect, except as modified herein. All terms not
defined herein shall have the meanings and be construed as set forth in the
Employment Agreement.

     7. Governing Law. This Amendment shall be governed by and construed in
accordance with the laws of the State of New Jersey.

     IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be
duly executed and delivered, all as of the day and year first above written.

                                           SOMERSET HILLS BANK

                                           By:
                                              ---------------------------------
                                           Stewart E. McClure, Jr.
                                           Chief Executive Officer

                                           ------------------------------------
                                           JOSEPH M. SULLIVAN

                                      -3-<PAGE>
                                                                     EXHIBIT 4.1

                   THE HARTFORD FINANCIAL SERVICES GROUP, INC.

                                       AND

                              JPMORGAN CHASE BANK,

                                   AS TRUSTEE

                             -----------------------

                          SUPPLEMENTAL INDENTURE NO. 2

                         DATED AS OF SEPTEMBER 13, 2002

                            ------------------------
<PAGE>
         THIS SUPPLEMENTAL INDENTURE No. 2 (this "SUPPLEMENTAL INDENTURE NO.
2"), dated as of September 13, 2002, is between THE HARTFORD FINANCIAL SERVICES
GROUP, a Delaware corporation (formerly known as ITT Hartford Group, Inc.) (the
"COMPANY"), and JPMORGAN CHASE BANK (formerly known as THE CHASE MANHATTAN BANK
(NATIONAL ASSOCIATION), a New York banking corporation, as Trustee (the
"TRUSTEE").

                                 R E C I T A L S

         WHEREAS, the Company has heretofore executed and delivered to the
Trustee a Senior Indenture dated as of October 20, 1995, as amended and
supplemented by Supplemental Indenture No. 1, dated as of December 27, 2000
between the Company and the Trustee (the "BASE INDENTURE" and together with this
Supplemental Indenture No. 2, the "INDENTURE"), providing for the issuance from
time to time of series of the Company's Securities (as defined in the Base
Indenture);

         WHEREAS, Section 901(4) of the Base Indenture provides for the Company
and the Trustee to enter into an indenture supplemental to the Base Indenture to
establish the form or terms of Securities of any series as permitted by Sections
201 or 301 of the Base Indenture;

         WHEREAS, pursuant to Section 301 of the Base Indenture, the Company
wishes to provide for the issuance of a new series of Securities to be known as
its 4.1% Senior Notes due 2008 (the "SENIOR NOTES"), the form and terms of such
Senior Notes and the terms, provisions and conditions thereof to be set forth as
provided in this Supplemental Indenture No. 2;

         WHEREAS, the Company has requested that the Trustee execute and deliver
this Supplemental Indenture No. 2 and all requirements necessary to make this
Supplemental Indenture No. 2 a valid, binding and enforceable instrument in
accordance with its terms, and to make the Senior Notes, when executed by the
Company and authenticated and delivered by the Trustee, the valid, binding and
enforceable obligations of the Company, have been done and performed, and the
execution and delivery of this Supplemental Indenture No. 2 has been duly
authorized in all respects.

         NOW, THEREFORE, in consideration of the covenants and agreements set
forth herein and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereto hereby agree as
follows:

                                       1
<PAGE>
                                    ARTICLE 1
                                   DEFINITIONS

         Section 1.01 Relation to Base Indenture. This Supplemental Indenture
No. 2 constitutes an integral part of the Base Indenture.

         Section 1.02. Definition Of Terms. For all purposes of this
Supplemental Indenture No. 2:

                  (a)      Capitalized terms used herein without definition
         shall have the meanings specified in the Base Indenture, or, if not
         defined in the Base Indenture, in the Purchase Contract Agreement, the
         Pledge Agreement or the Remarketing Agreement;

                  (b)      a term defined anywhere in this Supplemental
         Indenture No. 2 has the same meaning throughout;

                  (c)      the singular includes the plural and vice versa;

                  (d)      headings are for convenience of reference only and do
         not affect interpretation;

                  (e)      the following terms have the meanings given to them
         in this Section 1.02(e):

         "ACCOUNTING EVENT" means the receipt at any time prior to the earlier
of the date of any Successful Remarketing and the Purchase Contract Settlement
Date by the audit committee of the board of directors of the Company of a
written report in accordance with Statement on Auditing Standards ("SAS") No.
97, "Amendment to SAS No. 50 - Reports on the Application of Accounting
Principles", from the Company's independent auditors, provided at the request of
the management of the Company, to the effect that, as a result of a change in
accounting rules after the date hereof, the Company must either (i) account for
the Purchase Contract as a derivative under SFAS 133 or (ii) account for the
Units using the if-converted method under SFAS 128, and that such accounting
treatment will cease to apply upon redemption of the Senior Notes.

         "APPLICABLE PRINCIPAL AMOUNT" means the aggregate principal amount of
the Senior Notes that are components of Corporate Units.

         "BUSINESS DAY" shall have the meaning specified in the Purchase
Contract Agreement.

                                       2
<PAGE>
         "CORPORATE UNITS" shall have the meaning specified in the Purchase
Contract Agreement.

         "COUPON RATE" shall have the meaning set forth in Section 2.05(a).

         "DEPOSITARY" means a clearing agency registered under Section 17A of
the Securities Exchange Act of 1934, as amended, that is designated to act as
Depositary for the Corporate Units pursuant to the Purchase Contract Agreement.

         "DEPOSITARY PARTICIPANT" means a broker, dealer, bank, other financial
institution or other Person for whom from time to time the Depositary effects
book entry transfers and pledges of securities deposited with the Depositary.

         "FINAL REMARKETING PRICE" shall have the meaning set forth in Section
8.02(b).

         "GLOBAL SENIOR NOTES" shall have the meaning set forth in Section 2.04.

         "INTEREST PAYMENT DATE" shall have the meaning set forth in Section
2.05(b).

         "MATURITY DATE" shall have the meaning specified in Section 2.02.

         "PLEDGE AGREEMENT" means the Pledge Agreement, dated as of September
13, 2002 among the Company, JPMorgan Chase Bank, as Collateral Agent, Custodial
Agent and Securities Intermediary, and JPMorgan Chase Bank, as Purchase Contract
Agent and attorney-in-fact for the Holders of the Purchase Contracts, as amended
from time to time.

         "PURCHASE CONTRACT AGREEMENT" means the Purchase Contract Agreement,
dated as of September 13, 2002, between the Company and JPMorgan Chase Bank, as
purchase contract agent, as amended from time to time.

         "PURCHASE CONTRACT SETTLEMENT DATE" means November 16, 2006.

         "PUT PRICE" shall have the meaning set forth in Section 8.05.

         "PUT RIGHT" shall have the meaning set forth in Section 8.05.

         "QUOTATION AGENT" means any primary U.S. government securities dealer
selected by the Company.

         "RECORD DATE" means, with respect to any Interest Payment Date for the
Senior Notes, the first Business Day of the calendar month in which such
Interest Payment Date falls; provided that the Company may, at its option,
select any

                                       3
<PAGE>
other day as the Record Date for any Interest Payment Date so long as such
Record Date selected is more than one Business Day but less than sixty Business
Days prior to such Interest Payment Date.

         "REDEMPTION AMOUNT" shall mean, for each Senior Note, an amount equal
to the product of the principal amount of that Senior Note and a fraction, the
numerator of which is the Treasury Portfolio Purchase Price and the denominator
of which is the Applicable Principal Amount.

         "REDEMPTION PRICE" shall mean, for each Senior Note, the Redemption
Amount plus any accrued and unpaid interest on such Senior Note to but excluding
the Special Event Redemption Date.

         "REMARKETED SENIOR NOTES" shall have the meaning set forth in Section
8.01(c).

         "REMARKETING AGENT" means Morgan Stanley & Co. Incorporated, or any
successor thereto or replacement Remarketing Agent appointed by the Company
pursuant to the Remarketing Agreement.

         "REMARKETING AGREEMENT" means the Remarketing Agreement, dated as of
September 13, 2002, among the Company, Morgan Stanley & Co. Incorporated, as
Remarketing Agent and JPMorgan Chase Bank, as Purchase Contract Agent, as
amended from time to time.

         "REMARKETING PRICE" shall have the meaning set forth in Section
8.02(a).

         "RESET EFFECTIVE DATE" means the date three Business Days following the
date of a Successful Remarketing pursuant to which the Coupon Rate is reset to a
Reset Rate.

         "RESET RATE" means the interest rate per annum on the Senior Notes (i)
in the case of a Successful Remarketing prior to the Final Remarketing Date, the
rate determined by the Remarketing Agent as necessary to remarket the Remarketed
Senior Notes at a price per Remarketed Senior Note such that the aggregate price
for the Remarketed Senior Notes is equal to approximately 100.50% (but not less
than 100%, net of any Remarketing Fee and any other fees and expenses) of the
sum of the Treasury Portfolio Purchase Price and Separate Senior Notes Purchase
Price, and (ii) in the case of a Successful Remarketing on the Final Remarketing
Date, as the rate necessary to remarket the Remarketed Senior Notes at a price
per Remarketed Senior Note such that the aggregate price for the Remarketed
Senior Notes is equal to approximately 100.50% (but not less than 100%, net of
any Remarketing Fee and any other fees and expenses) of the aggregate principal
amount of the Remarketed Senior Notes; provided that if there are no Corporate

                                       4
<PAGE>
Units outstanding and none of the Holders elect to have Separate Senior Notes
held by them remarketed, or in the case of a Failed Remarketing, the interest
rate payable on the Senior Notes will not be reset and the interest rate payable
on the Senior Notes shall continue to be the Coupon Rate; provided further that
in no event shall the Reset Rate exceed the maximum rate, if any, permitted by
applicable law.

         "SEPARATE SENIOR NOTES" means Senior Notes that are no longer a
component of Corporate Units.

         "SPECIAL EVENT" shall mean either a Tax Event or an Accounting Event.

         "SPECIAL EVENT REDEMPTION" means the redemption of the Senior Notes
pursuant to the terms hereof following the occurrence of a Special Event.

         "SPECIAL EVENT REDEMPTION DATE" shall have the meaning set forth in
Section 3.01.

         "TAX EVENT" means the receipt by the Company of an opinion of counsel,
rendered by a law firm having a recognized national law practice, at any time
prior to the earlier of (x) the date of any Successful Remarketing and (y) the
Purchase Contract Settlement Date, to the effect that, as a result of any
amendment to, change in or announced proposed change in the laws (or any
regulations thereunder) of the United States or any political subdivision or
taxing authority thereof or therein, or as a result of any official
administrative decision, pronouncement, judicial decision or action interpreting
or applying such laws or regulations, which amendment or change is effective or
which proposed change, pronouncement, action or decision is announced on or
after the date hereof, there is more than an insubstantial increase in the risk
that interest payable by the Company on the Senior Notes is not, or within 90
days of the date of such opinion, will not be, deductible by the Company, in
whole or in part, for United States federal income tax purposes.

         "TREASURY PORTFOLIO" means a portfolio of (1) U.S. treasury securities
(or principal or interest strips thereof) that mature on or prior to November
15, 2006 in an aggregate amount equal to the Applicable Principal Amount, and
(2) (x) in the case of a Successful Remarketing prior to the Final Remarketing
Date, for the scheduled Interest Payment Date on the Purchase Contract
Settlement Date, U.S. treasury securities (or principal or interest strips
thereof) that mature on or prior to November 15, 2006 in an aggregate amount
equal to the aggregate interest payment (assuming no reset of the interest rate)
that would have been due on the Purchase Contract Settlement Date on the
Applicable Principal Amount, and (y) in the case of a Special Event Redemption,
for each scheduled Interest Payment Date that occurs after the Special Event
Redemption Date to and including the

                                       5
<PAGE>
Purchase Contract Settlement Date, U.S. treasury securities (or principal or
interest strips thereof) that mature on or prior to the business day immediately
preceding such scheduled Interest Payment Date in an aggregate amount equal to
the aggregate interest payment (assuming no reset of the interest rate) that
would have been due on such scheduled Interest Payment Date on the Applicable
Principal Amount.

         "TREASURY PORTFOLIO PURCHASE PRICE" means the lowest aggregate ask-side
price quoted by a Primary Treasury Dealer to the Quotation Agent between 9:00
a.m. and 11:00 a.m. (New York City time) (i) in the case of a Special Event
Redemption, on the third Business Day immediately preceding the Special Event
Redemption Date for the purchase of the applicable Treasury Portfolio for
settlement on the Special Event Redemption Date, and (ii) in the case of any
Successful Remarketing prior to the Final Remarketing Date, on the date of such
Successful Remarketing for the purchase of the applicable Treasury Portfolio for
settlement on the third Business Day immediately following the date of such
Successful Remarketing.

         The terms "COMPANY," "TRUSTEE," "INDENTURE," "BASE INDENTURE" and
"SENIOR NOTES" shall have the respective meanings set forth in the recitals to
this Supplemental Indenture No. 2 and the paragraph preceding such recitals.

                                    ARTICLE 2
                GENERAL TERMS AND CONDITIONS OF THE SENIOR NOTES

         Section 2.01. Designation and Principal Amount. There is hereby
authorized a series of Securities designated as 4.1% Senior Notes due November
16, 2008 limited in aggregate principal amount to $330,000,000. The Senior Notes
may be issued from time to time upon written order of the Company for the
authentication and delivery of Senior Notes pursuant to Section 303 of the Base
Indenture.

         Section 2.02. Maturity. Unless a Special Event Redemption occurs prior
to the Maturity Date (defined below), the date upon which the Senior Notes shall
become due and payable at final maturity, together with any accrued and unpaid
interest, is November 16, 2008 (the "MATURITY DATE").

         Section 2.03. Form, Payment and Appointment. Except as provided in
Section 2.04, the Senior Notes shall be issued in fully registered, certificated
form, bearing identical terms. Principal of and interest on the Senior Notes
will be payable, the transfer of such Senior Notes will be registrable, and such
Senior Notes will be exchangeable for Senior Notes of a like aggregate principal
amount bearing identical terms and provisions, at the office or agency of the
Company

                                       6
<PAGE>
maintained for such purpose in the Borough of Manhattan, The City of New York,
which shall initially be the Corporate Trust Office of the Trustee; provided,
however, that payment of interest may be made at the option of the Company by
check mailed to the Holder at such address as shall appear in the Security
Register or by wire transfer to an account appropriately designated by the
Holder entitled to payment.

         No service charge shall be made for any registration of transfer or
exchange of the Senior Notes, but the Company may require payment from the
Holder of a sum sufficient to cover any tax or other governmental charge that
may be imposed in connection therewith.

         The Security Registrar and Paying Agent for the Senior Notes shall
initially be the Trustee.

         The Senior Notes shall be issuable in denominations of $50 and integral
multiples of $50 in excess thereof.

         Section 2.04. Global Senior Notes. Senior Notes that are no longer a
component of the Corporate Units (as defined in the Purchase Contract Agreement)
and released from the Collateral Account (as defined in the Pledge Agreement)
will be issued in permanent global form (a "GLOBAL SENIOR NOTE"), and if issued
as one or more Global Senior Notes, the Depositary shall be The Depository Trust
Company or such other depositary as any officer of the Company may from time to
time designate. Unless and until such Global Senior Note is exchanged for Senior
Notes in certificated form, Global Senior Notes may be transferred, in whole but
not in part, and any payments on the Senior Notes shall be made, only to the
Depositary or a nominee of the Depositary, or to a successor Depositary selected
or approved by the Company or to a nominee of such successor Depositary.

         Section 2.05. Interest. (a) The Senior Notes will bear interest
initially at the rate of 4.1% per year (the "COUPON RATE") from the original
date of issuance through and including the earlier of (i) the Maturity Date and
(ii) the day immediately preceding any Reset Effective Date. In the event of a
Successful Remarketing of the Senior Notes, the Coupon Rate may be reset by the
Remarketing Agent at the appropriate Reset Rate with effect from the related
Reset Effective Date, as set forth under Section 8.03. If the Coupon Rate is so
reset, the Senior Notes will bear interest at the Reset Rate from the related
Reset Effective Date until the principal thereof and interest thereon is paid or
duly made available for payment and shall bear interest, to the extent permitted
by law, compounded quarterly, on any overdue principal and payment of interest
at the Coupon Rate through and including the day immediately preceding the Reset
Effective Date and at the Reset Rate thereafter.

                                       7
<PAGE>
         (b) Interest on the Senior Notes shall be payable quarterly in arrears
on February 16, May 16, August 16 and November 16 of each year (each, an
"INTEREST PAYMENT DATE"), commencing November 16, 2002, to the Person in whose
name such Senior Note, or any predecessor Senior Note, is registered at the
close of business on the Record Date for such Interest Payment Date. Interest on
the Senior Notes shall accrue from September 13, 2002.

         (c) The amount of interest payable for any full quarterly period will
be computed on the basis of a 360-day year consisting of twelve 30-day months.
The amount of interest payable for any period shorter than a full quarterly
period for which interest is computed will be computed on the basis of a 30-day
month and, for any period less than a month, on the basis of the actual number
of days elapsed per 30-day month. In the event that any scheduled Interest
Payment Date falls on a day that is not a Business Day, then payment of interest
payable on such Interest Payment Date will be made on the next succeeding day
which is a Business Day (and without any interest or other payment in respect of
any such delay), except that, if such Business Day is in the next calendar year,
then such payment will be made on the preceding Business Day.

         Section 2.06. No Defeasance. The provisions of Section 403 of the Base
Indenture shall not apply to the Senior Notes.

         Section 2.07. No Sinking Fund. The Senior Notes are not entitled to
the benefit of any sinking fund.

                                    ARTICLE 3
                         REDEMPTION OF THE SENIOR NOTES

         Section 3.01. Special Event Redemption. If a Special Event shall occur
and be continuing, the Company may, at its option, redeem the Senior Notes in
whole, but not in part, on any Interest Payment Date prior to the earlier of the
date of a Successful Remarketing or the Purchase Contract Settlement Date, at a
price per Senior Note equal to the Redemption Price, payable on the date of
redemption (the "SPECIAL EVENT REDEMPTION DATE") to the Holders of the Senior
Notes registered at the close of business on the Record Date for such Interest
Payment Date. If the Company so elects to redeem the Senior Notes, the Company
shall appoint the Quotation Agent to assist the Company in determining the
Treasury Portfolio Purchase Price. Notice of any Special Event Redemption will
be mailed by the Company (with a copy to the Trustee) at least 30 days but not
more than 60 days before the Special Event Redemption Date to each registered
Holder of the Senior Notes at its registered address. In addition, the Company
shall notify the Collateral Agent in writing that a Special Event has occurred
and that the

                                       8
<PAGE>
Company intends to redeem the Senior Notes on the Special Event Redemption Date.
Unless the Company defaults in the payment of the Redemption Price, on and after
the Special Event Redemption Date, (a) interest shall cease to accrue on the
Senior Notes, (b) the Senior Notes shall become due and payable at the
Redemption Price, and (c) the Senior Notes shall be void and all rights of the
Holders in respect of the Senior Notes shall terminate and lapse (other than the
right to receive the Redemption Price upon surrender of such Senior Notes but
without interest on such Redemption Price). Following the notice of a Special
Event Redemption, neither the Company nor the Trustee shall be required to
register the transfer of or exchange the Senior Notes to be redeemed.

         Section 3.02. Redemption Procedures. On or prior to the Special Event
Redemption Date, the Company shall deposit with the Trustee immediately
available funds in an amount sufficient to pay, on the Special Event Redemption
Date, the aggregate Redemption Price for all outstanding Senior Notes. In
exchange for any Senior Notes surrendered for redemption on or after the Special
Event Redemption Date, the Trustee shall pay an amount equal to the Redemption
Price (a) to the Collateral Agent, in the case of Senior Notes that are included
in Corporate Units, which amount shall be applied by the Collateral Agent in
accordance with the terms of the Pledge Agreement, and (b) to the holders of the
Separate Senior Notes, in the case of Separate Senior Notes.

                                    ARTICLE 4
                               FORM OF SENIOR NOTE

         Section 4.01. Form Of Senior Note. The Senior Notes and the Trustee's
Certificate of Authentication to be endorsed thereon are to be substantially in
the forms attached as Exhibit A hereto, with such changes therein as the
officers of the Company executing the Senior Notes (by manual or facsimile
signature) may approve, such approval to be conclusively evidenced by their
execution thereof.

                                    ARTICLE 5
                         ORIGINAL ISSUE OF SENIOR NOTES

         Section 5.01. Original Issue Of Senior Notes. Senior Notes in the
aggregate principal amount of $330,000,000 may from time to time, upon execution
of this Supplemental Indenture No. 2, be executed by the Company and delivered
to the Trustee for authentication, and the Trustee shall thereupon authenticate
and deliver said Senior Notes to or upon the written order of the Company
pursuant to Section 303 of the Base Indenture without any further action by the
Company (other than as required by the Base Indenture).

                                       9
<PAGE>
                                    ARTICLE 6
                             ORIGINAL ISSUE DISCOUNT

         Section 6.01. Original Issue Discount. The Company shall file with the
Trustee promptly at the end of each calendar year (i) a written notice
specifying the amount of original issue discount (including daily rates and
accrual periods) accrued on Senior Notes that are Outstanding as of the end of
the year and (ii) such other specific information relating to such original
issue discount as may then be relevant under the Internal Revenue Code of 1986,
as amended from time to time.

                                    ARTICLE 7
                                  MISCELLANEOUS

         Section 7.01. Ratification Of Indenture. The Indenture, as
supplemented by this Supplemental Indenture No. 2, is in all respects ratified
and confirmed, and this Supplemental Indenture No. 2 shall be deemed part of the
Indenture in the manner and to the extent herein and therein provided.

         Section 7.02. Trustee Not Responsible For Recitals. The recitals
herein contained are made by the Company and not by the Trustee, and the Trustee
assumes no responsibility for the correctness thereof. The Trustee makes no
representation as to the validity or sufficiency of this Supplemental Indenture
No. 2.

         Section 7.03. New York Law To Govern. THIS SUPPLEMENTAL INDENTURE NO.
2 AND EACH SENIOR NOTE SHALL BE DEEMED TO BE CONTRACTS MADE UNDER THE LAWS OF
THE STATE OF NEW YORK AND SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES
THEREOF.

         Section 7.04. Separability. In case any one or more of the provisions
contained in this Supplemental Indenture or in the Senior Notes shall for any
reason be held to be invalid, illegal or unenforceable in any respect, then, to
the extent permitted by law, such invalidity, illegality or unenforceability
shall not affect any other provisions of this Supplemental Indenture No. 2 or of
the Senior Notes, but this Supplemental Indenture No. 2 and the Senior Notes
shall be construed as if such invalid or illegal or unenforceable provision had
never been contained herein or therein.

                                       10
<PAGE>
         Section 7.05. Counterparts. This Supplemental Indenture may be executed
in any number of counterparts each of which shall be an original, but such
counterparts shall together constitute but one and the same instrument.

                                    ARTICLE 8
                                   REMARKETING

         Section 8.01. Remarketing Procedures. (a) Unless a Special Event
Redemption or a Successful Remarketing has occurred prior to the applicable
Remarketing Date, the Company shall engage the Remarketing Agent pursuant to the
Remarketing Agreement for the Remarketing of the Senior Notes. The Company will
request, not later than seven nor more than 15 calendar days prior to the
applicable Remarketing Date, that the Depositary or its nominee notify the
Beneficial Owners or Depositary Participants holding Separate Senior Notes,
Corporate Units and Treasury Units of the procedures to be followed in the
applicable Remarketing.

         (b) Each Holder of Separate Senior Notes may elect to have Separate
Senior Notes held by such Holder remarketed in any Remarketing. A Holder making
such an election must, pursuant to the Pledge Agreement, notify the Custodial
Agent and deliver such Separate Senior Notes to the Custodial Agent prior to
5:00 P.M. (New York City time) on or prior to the fifth Business Day immediately
preceding the applicable Remarketing Date (but no earlier than the Interest
Payment Date immediately preceding the applicable Remarketing Date). Any such
notice and delivery may not be conditioned upon the level at which the Reset
Rate is established in the Remarketing. Any such notice and delivery may be
withdrawn prior to 5:00 P.M. (New York City time) on or prior to the fifth
Business Day immediately preceding the applicable Remarketing Date in accordance
with the provisions set forth in the Pledge Agreement. Any such notice and
delivery not withdrawn by such time will be irrevocable with respect to such
Remarketing. Pursuant to Section 5.07(c) of the Pledge Agreement, promptly after
11:00 A.M., New York City time, on the Business Day immediately preceding the
applicable Remarketing Date, the Custodial Agent, based on the notices and
deliveries received by it prior to such time, shall notify the Remarketing Agent
of the principal amount of Separate Senior Notes to be tendered for remarketing
and shall cause such Separate Senior Notes to be presented to the Remarketing
Agent. Under Section 5.02 of the Purchase Contract Agreement, Senior Notes that
are components of Corporate Units will be deemed tendered for Remarketing and
will be remarketed in accordance with the terms of the Remarketing Agreement.

                                       11
<PAGE>
         (c) The right of each Holder of Senior Notes that are included in
Corporate Units to have such Senior Notes, and each Holder of Separate Senior
Notes to have any Separate Senior Notes (together, the "REMARKETED SENIOR
NOTES"), remarketed and sold on any Remarketing Date shall be limited to the
extent that (i) the Remarketing Agent conducts a Remarketing pursuant to the
terms of the Remarketing Agreement, (ii) a Special Event Redemption has not
occurred prior to such Remarketing Date, (iii) the Remarketing Agent is able to
find a purchaser or purchasers for Remarketed Senior Notes at the Remarketing
Price or the Final Remarketing Price, as the case may be, and (iv) the purchaser
or purchasers deliver the purchase price therefor to the Remarketing Agent as
and when required.

         (d) Neither the Trustee, the Company nor the Remarketing Agent shall be
obligated in any case to provide funds to make payment upon tender of Senior
Notes for remarketing.

         Section 8.02. Remarketing. (a) Unless a Special Event Redemption has
occurred prior to the Initial Remarketing Date, on the Initial Remarketing Date,
the Remarketing Agent shall, pursuant and subject to the terms of the
Remarketing Agreement, use its reasonable efforts to remarket the Remarketed
Senior Notes at a price (the "REMARKETING PRICE") equal to approximately 100.50%
(or, if the Remarketing Agent is unable to remarket the Remarketed Senior Notes
at such rate, at a rate below 100.50% in the discretion of the Remarketing
Agent, but in no event less than 100%, net of any Remarketing Fee and any other
fees and expenses) of the sum of the Treasury Portfolio Purchase Price and the
Separate Senior Note Purchase Price.

         (b) In the case of a Failed Initial Remarketing and unless a Special
Event Redemption has occurred prior to the Second Remarketing Date, on the
Second Remarketing Date, the Remarketing Agent shall use its reasonable efforts
to remarket the Remarketed Senior Notes at the Remarketing Price. In the case of
a Failed Second Remarketing and unless a Special Event Redemption has occurred
prior to the Third Remarketing Date, on the Third Remarketing Date, the
Remarketing Agent shall use its reasonable efforts to remarket the Remarketed
Senior Notes at the Remarketing Price. In the case of a Failed Third Remarketing
and unless a Special Event Redemption has occurred prior to the Final
Remarketing Date, on the Final Remarketing Date, the Remarketing Agent shall use
its reasonable efforts to remarket the Remarketed Senior Notes at a price (the
"FINAL REMARKETING PRICE") equal to approximately 100.50% (or, if the
Remarketing Agent is unable to remarket the Remarketed Senior Notes at such
rate, at a rate below 100.50% in the discretion of the Remarketing Agent, but in
no event less than 100%, net of any Remarketing Fee and any other fees and
expenses) of the aggregate principal amount of the Remarketed Senior Notes. It

                                       12
<PAGE>
is understood and agreed that Remarketing on any Remarketing Date will be
considered successful and no further attempts will be made if the resulting
proceeds are at least 100% (net of any Remarketing Fee and any other fees and
expenses) of the sum of the Treasury Portfolio Purchase Price and the Separate
Senior Note Purchase Price, in the case of a Remarketing other than the Final
Remarketing, or 100% (net of any Remarketing Fee and any other fees and
expenses) of the aggregate principal amount of the Remarketed Senior Notes in
the case of the Final Remarketing.

         Section 8.03. Reset Rate. (a) In connection with each Remarketing, the
Remarketing Agent shall determine the Reset Rate (rounded to the nearest
one-thousandth (0.001) of one percent per annum) that the Remarketed Senior
Notes should bear in order to have an aggregate market value equal to the
Remarketing Price or the Final Remarketing Price, as the case may be, and that
in the sole reasonable discretion of the Remarketing Agent will enable it to
remarket all of the Remarketed Senior Notes at the Remarketing Price or Final
Remarketing Price, as the case may be, in such Remarketing.

         (b) Anything herein to the contrary notwithstanding, the Reset Rate
shall in no event exceed the maximum rate permitted by applicable law and the
Remarketing Agent shall have no obligation to determine whether there is any
limitation under applicable law on the Reset Rate or, if there is any such
limitation, the maximum permissible Reset Rate on the Senior Notes and they
shall rely solely upon written notice from the Company (which the Company agrees
to provide prior to the eighth Business Day before the Initial Remarketing Date)
as to whether or not there is any such limitation and, if so, the maximum
permissible Reset Rate.

         (c) In the event of a Failed Remarketing or if no Senior Notes are
included in Corporate Units and none of the holders of the Separate Senior Notes
elect to have their Senior Notes remarketed in any Remarketing, the applicable
interest rate on the Senior Notes will not be reset and will continue to be the
Coupon Rate.

         (d) In the event of a Successful Remarketing, the Coupon Rate shall be
reset at the Reset Rate as determined by the Remarketing Agent under the
Remarketing Agreement.

         Section 8.04. Failed Remarketing. (a) If, by 4:00 p.m. (New York City
time) on any Remarketing Date, the Remarketing Agent is unable to remarket all
of the Remarketed Senior Notes at the Remarketing Price or the Final Remarketing
Price, as the case may be, pursuant to the terms and conditions hereof, a Failed
Remarketing shall be deemed to have occurred, and the Remarketing Agent shall
advise, by telephone the Depositary, the Purchase

                                       13
<PAGE>
Contract Agent and the Company, and return the Remarketed Senior Notes to the
Collateral Agent or the Custodial Agent, as the case may be.

         (b) The Company shall cause a notice of such Failed Remarketing to be
published in a daily newspaper in the English language of general circulation in
the City of New York, which is expected to be The Wall Street Journal.

         Section 8.05. Put Right. If there has not been a Successful
Remarketing prior to the Purchase Contract Settlement Date, the holders of
Senior Notes will have the right (the "PUT RIGHT") to require the Company to
purchase their Senior Notes on December 31, 2006 (the "EXERCISE DATE") upon a
notice to the Trustee on or prior to the fifth Business Day prior to the
Exercise Date, at a price per Senior Note equal to $50.00 plus accrued and
unpaid interest to but excluding the Exercise Date (the "PUT PRICE"). If there
has not been a Successful Remarketing prior to the Purchase Contract Settlement
Date, the Company shall notify, not more than ten (10) days after the Purchase
Contract Settlement Date, Beneficial Owners of the Senior Notes of the
procedures to be followed if any Holder elects to exercise its Put Right.

         Section 8.06 . Additional Event of Default. In addition to the events
listed as Events of Default in Section 501 of the Base Indenture, it shall be an
additional Event of Default with respect to the Senior Notes, if the Company
defaults in the payment of the Put Price with respect to any Separate Senior
Note following the exercise of the Put Right by any Holder of Separate Senior
Notes in accordance with Section 8.05.

                                    ARTICLE 9
                                  TAX TREATMENT

         Section 9.01. Tax Treatment. The Company agrees, and by acceptance of
the Senior Notes, each holder of Senior Notes will be deemed to have agreed (1)
for United States federal, state and local income and franchise tax purposes to
treat the acquisition of a Corporate Unit as the acquisition of the Senior Note
and the Purchase Contract constituting the Corporate Units and (2) to treat the
Senior Notes as indebtedness for United States federal, state and local income
and franchise tax purposes. A Holder of Senior Notes may obtain the amount of
original issue discount, issue date, yield to maturity, comparable yield and
projected payment schedule for the Senior Notes, determined by the Company
pursuant to Treas. Reg. Sec. 1.1275-4, by submitting a written request for it to
the Company at the following address: The Hartford Financial Services Group,
Inc., Investor Relations, Hartford Plaza, Hartford, Connecticut 06115.

                                       14
<PAGE>
         IN WITNESS WHEREOF, the parties hereto have caused this Supplemental
Indenture No. 2 to be duly executed, as of the day and year first written above.

                                        THE HARTFORD FINANCIAL
                                        SERVICES GROUP, INC.

                                        By: /s/ John N. Giamalis
                                            ------------------------------------
                                            Name:  John N. Giamalis
                                            Title: Senior Vice President
                                                   and Treasurer

Attest:

/s/ Amy Gallent
----------------------------
Name:  Amy Gallent
Title: Senior Vice President

                                        JPMORGAN CHASE BANK, as
                                        Trustee

                                        By: /s/ Joanne Adamis
                                            ------------------------------------
                                            Name:  Joanne Adamis
                                            Title: Vice President

Attest:

/s/ Diane H. Darconte
----------------------------
Name:  Diane H. Darconte
Title: Trust Officer

----------------------------
Name:
Title:
<PAGE>
                                                                       EXHIBIT A

[IF THIS SENIOR NOTE IS TO BE A GLOBAL SECURITY, INSERT:]
THIS SENIOR NOTE IS A GLOBAL SECURITY WITHIN THE MEANING OF THE INDENTURE
HEREINAFTER REFERRED TO AND IS REGISTERED IN THE NAME OF THE DEPOSITORY TRUST
COMPANY OR A NOMINEE OF THE DEPOSITORY TRUST COMPANY. THIS SENIOR NOTE IS
EXCHANGEABLE FOR SECURITIES REGISTERED IN THE NAME OF A PERSON OTHER THAN THE
DEPOSITORY TRUST COMPANY OR ITS NOMINEE ONLY IN THE LIMITED CIRCUMSTANCES
DESCRIBED IN THE INDENTURE AND MAY NOT BE TRANSFERRED EXCEPT AS A WHOLE BY THE
DEPOSITORY TRUST COMPANY TO A NOMINEE OF THE DEPOSITORY TRUST COMPANY OR BY A
NOMINEE OF THE DEPOSITORY TRUST COMPANY TO THE DEPOSITORY TRUST COMPANY OR
ANOTHER NOMINEE OF THE DEPOSITORY TRUST COMPANY.

UNLESS THIS CERTIFICATE IS PRESENTED BY AN AUTHORIZED REPRESENTATIVE OF THE
DEPOSITORY TRUST COMPANY, A NEW YORK CORPORATION ("DTC"), TO THE ISSUER OR ITS
AGENT FOR REGISTRATION OF TRANSFER, EXCHANGE, OR PAYMENT, AND ANY CERTIFICATE
ISSUED IS REGISTERED IN THE NAME OF CEDE & CO. OR IN SUCH OTHER NAME AS IS
REQUESTED BY AN AUTHORIZED REPRESENTATIVE OF DTC (AND ANY PAYMENT IS MADE TO
CEDE & CO. OR TO SUCH OTHER ENTITY AS IS REQUESTED BY AN AUTHORIZED
REPRESENTATIVE OF DTC), ANY TRANSFER, PLEDGE, OR OTHER USE HEREOF FOR VALUE OR
OTHERWISE BY OR TO ANY PERSON IS WRONGFUL INASMUCH AS THE REGISTERED OWNER
HEREOF, CEDE & CO., HAS AN INTEREST HEREIN.

                   THE HARTFORD FINANCIAL SERVICES GROUP, INC.

4.1% Senior Notes due November 16, 2008                         No.
$                                                         CUSIP No.
 -------------

THE HARTFORD FINANCIAL SERVICES GROUP, INC. (formerly ITT Hartford Group, Inc.),
a corporation organized and existing under the laws of Delaware (hereinafter
called the "Company", which term includes any successor corporation under the
Indenture hereinafter referred to), for value received, hereby promises to pay
to           , or registered assigns, the principal sum of [up to]
($         ), [as set forth in the Schedule of Increases or Decreases In Senior
Note attached hereto,] on November 16, 2008 (such date is
<PAGE>
hereinafter referred to as the "MATURITY DATE"), and to pay interest thereon
from September 13, 2002 or from the most recent Interest Payment Date to which
interest has been paid or duly provided for, quarterly in arrears on February
16, May 16, August 15 and November 16 of each year, commencing November 16,
2002, at the rate of 4.1% per annum through and including the day immediately
preceding the Reset Effective Date, if any, and thereafter at the Reset Rate, if
any, on the basis of a 360-day year consisting of twelve 30-day months, until
the principal hereof is paid or duly provided for or made available for payment,
and (to the extent that the payment of such interest shall be legally
enforceable) to pay interest, compounded quarterly, at the rate of 4.1% per
annum on any overdue principal and payment of interest through and including the
day immediately preceding the Reset Effective Date, if any, and thereafter at
the Reset Rate, if any. The amount of interest payable for any period shorter
than a full quarterly period for which interest is computed will be computed on
the basis of a 30-day month and, for any period less than a month, on the basis
of the actual number of days elapsed per 30-day month. The interest so payable,
and punctually paid or duly provided for, on any Interest Payment Date will, as
provided in such Indenture, be paid to the Person in whose name this Senior Note
(or one or more Predecessor Senior Notes) is registered at the close of business
on the Record Date for such Interest Payment Date.

Payment of the principal of and interest on this Senior Note will be made at the
office or agency of the Company maintained for that purpose in the Borough of
Manhattan, The City of New York, which shall initially be the Corporate Trust
Office of the Trustee, in such coin or currency of the United States of America
as at the time of payment is legal tender for payment of public and private
debts; provided, however, that payment of interest may be made at the option of
the Company by check mailed to the Holder at such address as shall appear in the
Security Register or by wire transfer to an account appropriately designated by
the Holder entitled to payment.

Reference is hereby made to the further provisions of this Senior Note set forth
on the reverse hereof, which further provisions shall for all purposes have the
same effect as if set forth at this place.

Unless the certificate of authentication hereon has been executed by the Trustee
referred to on the reverse hereof by manual signature, this Senior Note shall
not be entitled to any benefit under the Indenture or be valid or obligatory for
any purpose.
<PAGE>
         IN WITNESS WHEREOF, the Company has caused this instrument to be duly
executed under its corporate seal.

Dated:

                                            THE HARTFORD FINANCIAL
                                            SERVICES GROUP, INC.

                                            By:
                                               ---------------------------------
                                               Name:
                                               Title:

Attest:

By:
   ---------------------------------
   Name:
   Title:

                     TRUSTEE'S CERTIFICATE OF AUTHENTICATION

This is one of the Senior Notes referred to in the within mentioned Indenture.

Dated:
      -------------------

JPMORGAN CHASE BANK,
as Trustee

By:
   -------------------------
   Authorized Officer
<PAGE>
                         FORM OF REVERSE OF SENIOR NOTE

         This Senior Note is one of a duly authorized issue of securities of the
Company (herein called the "Senior Notes"), issued and to be issued in one or
more series under a Senior Indenture, dated as of October 20, 1995, between the
Company and JPMorgan Chase Bank, as Trustee, successor to The Chase Manhattan
Bank (National Association) (herein called the "Trustee", which term includes
any successor trustee), as amended and supplemented by Supplemental Indenture
No. 1 dated as of December 27, 2000, between the Company and the Trustee (the
"Base Indenture"), and further supplemented by Supplemental Indenture No. 2
between the Company and the Trustee (the "Supplemental Indenture No. 2" and
together with the Base Indenture, the "Indenture"), to which Indenture reference
is hereby made for a statement of the respective rights, limitations of rights,
duties and immunities thereunder of the Company, the Trustee and the Holders of
the Senior Notes and of the terms upon which the Senior Notes are, and are to
be, authenticated and delivered. This Senior Note is one of the series
designated on the face hereof, limited in aggregate principal amount to
$330,000,000.

         If a Special Event shall occur and be continuing, the Company may, at
its option, redeem the Senior Notes of this series in whole, but not in part, on
any Interest Payment Date prior to the earlier of the date of a Successful
Remarketing or the Purchase Contract Settlement Date, at a price per Senior Note
equal to the Redemption Price as set forth in the Indenture.

         The Senior Notes are not entitled to the benefit of any sinking fund
and will not be subject to defeasance.

         If an Event of Default with respect to Senior Notes of this series
shall occur and be continuing, the principal of the Senior Notes of this series
may be declared due and payable in the manner and with the effect provided in
the Indenture.

         The Indenture permits, with certain exceptions as therein provided, the
amendment thereof and the modification of the rights and obligations of the
Company and the rights of the Holders of the Senior Notes at any time by the
Company and the Trustee with the consent of the Holders of a majority in
principal amount of the Senior Notes at the time Outstanding. The Indenture also
contains provisions permitting the Holders of specified percentages in principal
amount of the Senior Notes at the time Outstanding, on behalf of the Holders of
all Senior Notes, to waive compliance by the Company with certain provisions of
the Indenture and certain past defaults under the Indenture and their
consequences. Any such consent or waiver by the Holder of this Senior Note shall
<PAGE>
be conclusive and binding upon such Holder and upon all future Holders of this
Senior Note and of any Senior Note issued upon the registration of transfer
hereof or in exchange herefor or in lieu hereof, whether or not notation of such
consent or waiver is made upon this Senior Note.

         No reference herein to the Indenture and no provision of this Senior
Note or of the Indenture shall alter or impair the obligation of the Company,
which is absolute and unconditional, to pay the principal of and interest on
this Senior Note at the times, place and rate, and in the coin or currency,
herein prescribed.

         As provided in the Indenture and subject to certain limitations therein
set forth, the transfer of this Senior Note is registrable in the Securities
Register, upon surrender of this Senior Note for registration of transfer at the
office or agency of the Company in any place where the principal of and interest
on this Senior Note are payable, duly endorsed by, or accompanied by a written
instrument of transfer in form satisfactory to the Company and the Securities
Registrar duly executed by the Holder hereof or his attorney duly authorized in
writing, and thereupon one or more new Senior Notes of this series, of
authorized denominations and for the same aggregate principal amount, will be
issued to the designated transferee or transferees.

         The Senior Notes of this series are issuable only in registered form
without coupons in denominations of $50 and any integral multiple thereof. As
provided in the Indenture and subject to certain limitations therein set forth,
Senior Notes of this series are exchangeable for a like aggregate principal
amount of Senior Notes of this series of a different authorized denomination, as
requested by the Holder surrendering the same.

         No service charge shall be made for any such registration of transfer
or exchange, but the Company may require payment of a sum sufficient to cover
any tax or other governmental charge payable in connection therewith.

         Prior to due presentment of this Senior Note for registration of
transfer, the Company, the Trustee and any agent of the Company or the Trustee
may treat the Person in whose name this Senior Note is registered as the owner
hereof for all purposes, whether or not this Senior Note be overdue, and neither
the Company, the Trustee nor any such agent shall be affected by notice to the
contrary.

         All terms used in this Senior Note which are defined in the Indenture
shall have the meanings assigned to them in the Indenture.
<PAGE>
      The Company agrees, and by acceptance of the Senior Notes, each holder of
Senior Notes will be deemed to have agreed (1) for United States federal, state
and local income and franchise tax purposes to treat the acquisition of a
Corporate Unit as the acquisition of the Senior Note and the Purchase Contract
constituting the Corporate Unit and (2) to treat the Senior Notes as
indebtedness for United States federal, state and local income and franchise tax
purposes. A Holder of Senior Notes may obtain the amount of original issue
discount, issue date, yield to maturity, comparable yield and projected payment
schedule for the Senior Notes, determined by the Company pursuant to Treas. Reg.
Sec. 1.1275-4, by submitting a written request for it to the Company at the
following address: The Hartford Financial Services Group, Inc., Investor
Relations, Hartford Plaza, Hartford, Connecticut 06115.

                                       R-1
<PAGE>
                                   ASSIGNMENT

FOR VALUE RECEIVED, the undersigned assigns and transfers this Senior Note to:

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

(Insert assignee's social security or tax identification number)

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

(Insert address and zip code of assignee)

and irrevocably appoints

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

--------------------------------------------------------------------------------

agent to transfer this Senior Note on the books of the Company. The agent may
substitute another to act for him or her.

Date:
      ----------------------

                                        Signature:
                                                   -----------------------------

                                        Signature Guarantee:
                                                            ------------

(Sign exactly as your name appears on the other side of this Senior Note)
<PAGE>
                               SIGNATURE GUARANTEE

Signatures must be guaranteed by an "eligible guarantor institution" meeting the
requirements of the Registrar, which requirements include membership or
participation in the Security Transfer Agent Medallion Program ("STAMP") or such
other "signature guarantee program" as may be determined by the Registrar in
addition to, or in substitution for, STAMP, all in accordance with the
Securities Exchange Act of 1934, as amended.

By:
   ------------------------------
   Name
   Title:

                                                --------------------------------
                                                as Trustee

                                                By:
                                                   -----------------------------
                                                Name
                                                Title:

Attest:

By:
    ------------------------------
    Name
    Title:
<PAGE>
                SCHEDULE OF INCREASES OR DECREASES IN SENIOR NOTE

The following increases or decreases in a part of this Senior Note have been
made:

<TABLE>
<CAPTION>
                                                   PRINCIPAL
                                                   AMOUNT OF
                                                  THIS SENIOR
                 AMOUNT OF        AMOUNT OF          NOTE
                DECREASE IN      INCREASE IN       FOLLOWING        SIGNATURE
                 PRINCIPAL        PRINCIPAL          SUCH              OF
                 AMOUNT OF        AMOUNT OF        DECREASE         AUTHORIZED
                THIS SENIOR      THIS SENIOR         (OR            OFFICER OF
     DATE          NOTE             NOTE           INCREASE)         TRUSTEE
<S>             <C>               <C>              <C>              <C>
</TABLE>

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