Document:

Exhibit 10.35

 

AMENDED AND RESTATED NON-SOLICITATION AND NON-DISCLOSURE AGREEMENT

 

THIS AMENDED AND RESTATED NON-SOLICITATION AND NON-DISCLOSURE AGREEMENT (“Agreement”) is made and entered into this          th day of             ,    20  , by and between The Travelers Companies, Inc., a Minnesota corporation, including its present and future affiliated entities (collectively, the “Company”), and XXXX (the “Employee”).

 

WITNESSETH:

 

WHEREAS, the Employee is employed by the Company; and

 

WHEREAS, the Company is engaged in the business of underwriting and selling insurance and insurance-related products throughout the United States.

 

NOW, THEREFORE, in consideration of the promises and the mutual covenants and obligations hereinafter set forth, the parties agree as follows:

 

SECTION 1.                                                 CONSIDERATION.

 

(a)                                 As consideration for the execution of this Agreement, the Employee acknowledges receipt of the amount of Five Thousand Dollars ($5,000.00) (“the Consideration”), to the extent not previously paid in connection with the execution of a prior version of this Agreement, which constitutes good, valuable and independent consideration for all of Employee’s covenants and obligations in this Agreement and is above and beyond any compensation Employee is entitled to receive from the Company.

 

(b)                                 As further consideration for the execution of this Agreement, the Employee shall be eligible to participate in and receive the benefits of the executive severance plan as set forth in Schedule B of The Travelers Severance Plan (as amended and restated effective January 1, 2015) (the “Severance Plan”), in the event Employee is involuntarily terminated because of a reduction in force, involuntarily terminated for reasons other than Cause (as defined in Section 2) or asked to take a substantial demotion, and otherwise pursuant to the terms and conditions of the Severance Plan and regardless of any amendment to or termination of the Severance Plan, except that for the purpose of Schedule B, the number of months of severance benefit shall in no event be less than 21 months and the “total monthly cash compensation” shall in no event be less than one twelfth (1/12) of the Employee’s base salary in effect at the time of his/her termination of employment (“final base salary”) plus the greater of (i) one twelfth (1/12) of the average of his/her two most recent cash payments under the annual incentive compensation plan of the Company, or (ii) one twelfth (1/12) of 125% of the final base salary for any Employee who is serving the Employer in a position of Executive Vice President or equivalent (as determined by Company and the position of Vice Chairman is 

 

 

deemed to be equivalent to Executive Vice President); and 110% of the final base salary of any Employee who is serving the Employer in a position of Senior Vice President or equivalent (as determined by Company).  Further, in order to be eligible for benefits under the Severance Plan, Employee will be required to, among other things, execute a Waiver and Release, as defined in the Severance Plan, in a form satisfactory to Company.  (The current standard non-solicitation clauses included in the Waiver and Release are attached and incorporated herein for your reference as Exhibit A.)  Nothing in this Agreement is intended or may be interpreted to amend or revise the Severance Plan, except as set forth and applicable herein.  Schedule B of the Severance Plan, as in effect as of the date hereof (“Schedule B”), is incorporated herein by reference.  Such Schedule B, together with the above described enhanced benefit set forth a schedule of minimum severance for Employee and other members of the Management Committee.  To the extent the Company revises the existing Severance Plan to increase the benefits, Employee will be entitled to the greater of (i) the new increased benefits under the Severance Plan or (ii) the Severance Plan benefits in existence at the time this Agreement was executed, in each case, with any additional enhancements as applicable pursuant to this Section 1(b).  To the extent Company revises the Severance Plan to decrease benefits or adopts a Severance Plan which allows for a benefit to be paid that is less than that set forth in Schedule B, Employee shall be entitled to the benefits set forth in Schedule B, as modified by this Section 1(b).

 

SECTION 2.                                                                         DEFINITIONS

 

For purposes of this Agreement, the following terms are defined as follows:

 

(a)                                 “Cause” shall mean Employee’s conviction of any felony, Employee’s willful misconduct in connection with the performance of Employee’s duties with Company, or Employee’s taking illegal action in Employee’s business or personal life that harms the reputation or damages the good name of Company.

 

(b)                                 “Change of Control” shall mean any of the following (i) members of the Board of Directors on the date hereof (“Incumbent Board”) cease for any reason to constitute a majority thereof, provided that persons subsequently becoming directors with the approval of directors constituting at least two-thirds (2/3) of the Incumbent Board (either by a specific vote or by approval of the proxy statement of the Company in which such person is named as a nominee for director, without written objection to such nomination) will be considered as members of the Incumbent Board provided, however, that no individual initially elected or nominated as a director of the Company as a result of an actual or threatened election contest (as described in Rule 14a-11 under the Securities Exchange Act of 1934 (the “Act”)) (“Election Contest”) or any other actual or threatened solicitation of proxies or consents by or on behalf of any “person” (as such term is defined in Section 3(a)(9) of the Act) other than the Board (“Proxy Contest”), including by reason of any agreement intended to avoid or settle any Election Contest or Proxy Contest, shall be deemed to be a member of the Incumbent Board, or (ii) any person as defined in the Act, other than the Company, a Company subsidiary, any employee benefit plan (or related trust) sponsored or maintained by the Company or any 

 

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Company subsidiary, any employee or any group of persons including an employee (or any entity controlled by an employee or any group of persons including an employee) or an underwriter temporarily holding securities pursuant to an offering of such securities, is or becomes the beneficial owner, directly or indirectly, of 30% or more of the company’s voting securities, or (iii) the consummation of a merger, consolidation, statutory share exchange or similar form of corporate transaction involving the Company, or any of its subsidiaries that requires the approval of the Company’s stockholders, whether for such transaction or the issuance of securities in the transaction, or the sale or other disposition of all or substantially all of the Company’s assets to an unaffiliated entity, unless immediately after such corporate transaction or sale, (A) more than 60% of the total voting securities of the corporation resulting from such corporate transaction or sale (or if applicable, the ultimate parent corporation that directly or indirectly has beneficial ownership of 100% of the voting securities eligible to elect directors of the surviving company) is represented by voting securities of the Company that were outstanding immediately prior to such corporate transaction or sale (or by shares into which such Company voting securities were converted pursuant to such corporate transaction or sale) and such voting power among the holders thereof is in substantially the same proportion as the voting power of such Company voting securities among the holders thereof immediately prior to the corporate transaction or sale, (B) no person (other than any employee benefit plan (or related trust) sponsored or maintained by the surviving company or the parent company), is or becomes the beneficial owner, directly or indirectly, of 30% or more of the total voting power of the outstanding voting securities eligible to elect directors of the parent company (or, if there is no parent company, the surviving company) and (C) at least a majority of the members of the board of directors of the parent company (or, if there is no parent company, the surviving company) following the consummation of the corporate transaction or sale were members of the Incumbent Board at the time of the Board’s approval of the execution of the initial agreement providing for such corporate transaction or sale (any corporate transaction or sale which satisfies all of the criteria specified in (A) (B) and (C) above shall be deemed to be a “Non-Qualifying Transaction”); or (iv) the Company’s shareholders approve a plan of complete liquidation or dissolution of the Company.  Notwithstanding the foregoing, a Change of Control shall not be deemed to occur solely because any person acquires beneficial ownership of more than 30% of the Company voting securities as a result of the acquisition of Company voting securities by the Company which reduces the number of Company voting securities outstanding; provided that if after such acquisition by the Company such person becomes the beneficial owner of additional Company voting securities that increases the percentage of outstanding Company voting securities beneficially owned by such person, a Change of Control of the Company shall then occur.

 

(c)                                  “Constructive Discharge” shall mean conduct by the Company that would lead a reasonable person to leave employment due to intolerable conditions created by the Company,  reduction of the Employee’s base salary (except in the event of a generally proportionate reduction of all of the Management Committee members’ salaries), the cessation of the Employee being a member of the Management Committee (provided, however, that in the event Employee voluntarily steps down from the Management 

 

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Committee, this Agreement shall become void three months from that date), changing Employee’s reporting relationship that results in Employee reporting to someone who is not a member of the Management Committee, the Chairman or the Chief Executive Officer, changing Employee’s reporting relationship or reducing his/her responsibilities such that it would cause a reasonable person to resign and causes Employee to resign, or requiring Employee to accept a position that would reasonably require relocation.

 

(d)                                 “Restricted Period” shall mean the twelve (12) month period following the Employee’s termination of employment.

 

(e)                                  “Management Committee” shall mean the most senior policy setting group of executives within the Company, excluding the Chairman and the Chief Executive Officer.

 

SECTION 3.                                                 NON-DISCLOSURE OF CONFIDENTIAL INFORMATION.

 

(a)                                 Employee recognizes that the Company has developed information that is confidential, proprietary and/or nonpublic that is related to its business, operations, services, finances, clients, customers, policyholders, vendors and agents (“Confidential Information”).  Employee understands and agrees that he/she is prohibited from using, disclosing, divulging or misappropriating any Confidential Information for his/her own personal benefit or for the benefit of any person or entity, except that Employee may disclose Confidential Information pursuant to a properly issued subpoena, court order, other legal process, or official inquiry of a federal, state or local taxing authority, or other governmental agency with a legitimate legal right to know the Confidential Information.  If disclosure is compelled of Employee by subpoena, court order or other legal process, or as otherwise required by law, Employee agrees to notify Company as soon as notice of such process is received and before disclosure and/or appearance takes place.  Employee will use reasonable and prudent care to safeguard and prevent the unauthorized use or disclosure of Confidential Information.  Confidential Information shall not include any information that:  (a) is or becomes a part of the public domain through no act or omission of Employee or is otherwise available to the public other than by breach of this Agreement; (b) was in Employee’s lawful possession prior to the disclosure and had not been obtained by Employee either directly or indirectly as a result of Employee’s employment with or other service to the Company; (c) is disclosed to Employee by a third party who has authority from the Company to make such disclosure and such disclosure to Employee is not confidential; or (d) is independently developed by Employee outside of Employee’s employment with the Company and without the use of any Confidential Information.  Employee further acknowledges that Employee, in the course of employment, has had and will have access to such Confidential Information.

 

(b)                                 Employee agrees that every document, computer disk, electronic file, computerized information, computer software program, notation, record, diary, memorandum, development, investigation, or the like, and any method or manner of doing business of the Company containing Confidential Information made or acquired by 

 

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the Employee during employment by the Company is and shall be the sole and exclusive property of Company.  The Employee will deliver the same (and every copy, disk, abstract, summary, or reproduction of the same made by or for the Employee or acquired by the Employee) whenever the Company may so require and in any event prior to or at the termination of employment.  Nothing in Section 3 is intended or shall be interpreted to mean that the Company may withhold information, including computerized information, relating to Employee’s personal contacts and personal information that may be stored or contained in Employee’s physical or electronic files.  The Company further agrees not to unreasonably withhold information relating to Employee’s business-related contacts, to the extent such information falls outside the definition of Confidential Information set forth in Section 3(a) above.

 

SECTION 4.                                                 NON-SOLICITATION/NON-INTERFERENCE.

 

The parties understand and agree that this Agreement is intended to protect the Company against the Employee raiding its employees and/or its business during the Restricted Period, while recognizing that after his/her termination, Employee is still permitted to freely compete with the Company, except to the extent Confidential Information is used in such solicitation and subject to certain restrictions set forth below.  Further, nothing in this Agreement is intended to grant or limit any rights or claims as to any future employer of Employee.  To this end, any court considering the enforcement of this Agreement for a breach of this Agreement, must accept this statement of intent.

 

(a)                                 After Employee has left the employment of the Company and during the Restricted Period, Employee will not seek to recruit or solicit, or assist in recruiting or soliciting, participate in or promote the solicitation of, interfere with, attempt to influence or otherwise affect the employment of any person who was or is employed by the Company at any time during the last three months of Employee’s employment or thereafter.  Further, Employee shall not, on behalf of himself/herself or any other person, hire, employ or engage any such person.  The parties agree that Employee shall not directly engage in the aforesaid conduct through a third party for the purpose of colluding to avoid the restrictions in this Agreement.  However, nothing in this Agreement precludes Employee from directing a third party (including but not limited to employees of his/her subsequent employer or a search firm) to broadly solicit, recruit, and hire individuals, some of whom may be employees of the Company, provided that Employee does not specifically direct such third party to specifically target the Company’s employees generally or specific individual employees of the Company.

 

(b)                                 After Employee has left the employment of the Company, accepts a position as an employee, consultant or contractor with a direct competitor of the Company, and during the Restricted Period, Employee will not utilize Confidential Information to seek to solicit or assist in soliciting, participate in or otherwise promote the solicitation of, interference with, attempt to influence or otherwise affect any person or entity, who is a client, customer, policyholder, or agent of the Company, to discontinue business with the Company, and/or move that business elsewhere.  Employee also agrees 

 

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not to be directly and personally involved in the negotiation or solicitation of any individual book roll over(s) or other book of business transfer arrangements involving the transfer of business away from Company, even if Confidential Information is not involved.  However, nothing in this Agreement precludes the Employee from directing a third party (including but not limited to employees of his/her subsequent employer) to solicit, compete for, negotiate and execute book roll over deals or other book of business transfer arrangements provided that (i) Confidential Information provided by the Employee is not used, (ii) Employee is not personally and directly involved in such negotiations, and (iii) Employee does not direct such third party to target specific agents of Company.  Furthermore, nothing in this Agreement precludes the Employee from freely competing with the Company including but not limited to competing on an account by account or deal by deal basis to the extent that he/she does not use Confidential Information.

 

(c)                                  This Section 4 is inapplicable in the event Employee accepts and signs the Waiver and Release as described in Section 12(e).

 

SECTION 5.                                                 ATTORNEYS’ FEES.

 

If a dispute arises concerning the terms and conditions of this Agreement, Employee and Company agree to pay their own respective attorneys’ fees and costs.

 

SECTION 6.                                                 EXTENSION OF OBLIGATIONS.

 

If Employee breaches any of the provisions of Section 4 of this Agreement, and if the Company brings legal action for injunctive relief during the Restricted Period and injunctive relief is ordered by a court of competent jurisdiction, then one day of additional time shall be added to the restriction for each day of noncompliance, up to a maximum of twelve (12) months, so that the Company is given the benefit of Employee’s compliance with the restriction for twelve (12) months following employment as agreed.  If, however, the Company takes no action within the Restricted Period, then the Company shall have no right to bring a legal action under this Agreement against Employee.

 

SECTION 7.                                                 CONSENT TO JURISDICTION.

 

Jurisdiction and venue for enforcement of this Agreement, and for resolution of any dispute under this Agreement, shall be exclusively in the federal or state courts in the state and county where the Employee resides at the time that the Company commences an enforcement action.  Employee agrees to advise the Company’s General Counsel of his/her residence during the Restricted Period.

 

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SECTION 8.                                                 EMPLOYMENT-AT-WILL.

 

Employee specifically recognizes and agrees that nothing in this Agreement shall be deemed to change the existing employment relationship between the Employee and the Company, and that this Agreement is not an employment agreement for continued employment.

 

SECTION 9.                                                 GOVERNING LAW.

 

This Agreement shall be construed interpreted in accordance with the laws of the State of Minnesota.

 

SECTION 10.                                          WAIVER.

 

The waiver of a breach of any provision of this Agreement shall not operate as or be construed as a waiver of any subsequent breach of this Agreement.  To the extent that a common law duty exists with respect to the use of Confidential Information that would cause the Company irreparable harm, Employee recognizes and acknowledges his/her obligation to abide by that duty both before and after the Restricted Period.

 

SECTION 11.                                          SEVERABILITY.

 

If any provision, section or subsection of this Agreement is adjudged by any court to be void or unenforceable in whole or in part, this adjudication shall not affect the validity of the remainder of the Agreement, including any other provision, section or subsection.  Each provision, section, and subsection of this Agreement is separable from every other provision, section and subsection and constitutes a separate and distinct covenant.  Both Employee and the Company agree that if any court rules that a restriction contained in this Agreement is unenforceable as written, the parties will meet and confer to negotiate the reformation of the provision.

 

SECTION 12.                                          ASSIGNMENT AND EXPIRATION OF AGREEMENT.

 

(a)                                 This Agreement is not assignable by Employee or the Company without the written consent of the other party.

 

(b)                                 It is the intent of the Company that all members of the Management Committee will sign and be bound by the terms of this Agreement.  The Company also agrees that all future Management Committee members will be required to sign a non-solicitation non-disclosure agreement within thirty (30) days of joining the Management Committee, such agreement to be on the same terms as this Agreement, except for 

 

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conforming changes, technical changes and corrections which are not more favorable to such person than as provided in this Agreement as then in effect.

 

(c)                      The Company agrees that it will not amend, alter, modify, or otherwise change the terms of the non-solicitation non-disclosure agreement for any present or future Management Committee member, except as referenced in Sections 12(b) or 12(f).  If the Company amends, alters, modifies or otherwise changes the terms of the non-solicitation nondisclosure agreement for any present or future Management Committee member such that the terms are less restrictive than the terms set forth in this Agreement, the Company will modify the terms of this Agreement to reflect the less restrictive terms.  The Company agrees to notify Employee in writing within fourteen (14) days of its execution or modification of such a non-solicitation non-disclosure agreement with any present or future Management Committee member.  Additionally, in the event that future members of the Management Committee are not required to execute this Agreement, do not sign the Agreement within thirty (30) days of joining the Management Committee, or any member of the Management Committee is no longer bound by this Agreement and permitted to remain on the Management Committee, then this Agreement shall immediately become void.  The Company agrees to advise Employee within fourteen (14) days, that the Agreement has become void.

 

(d)                                 In the event that Employee is removed from the Management Committee, and/or Employee is Constructively Discharged, then this Agreement shall immediately become void; provided, however, that if the Employee is Constructively Discharged following a Change of Control, then Employee shall have the option upon written notice to the Company within 90 days following such Constructive Discharge to cause this Agreement to become void and, in the absence of making any such election, this Agreement shall remain in effect.

 

(e)                                  In the event that Employee loses employment under the conditions as defined in the Severance Plan or as further defined in Section 1(b) and Employee accepts and signs the Waiver and Release, as defined and required by the Severance Plan, then Employee shall receive the enhanced benefits set forth in Section 1(b), and the non-solicitation terms set forth in such Waiver and Release shall supersede the terms set forth in Section 4 hereof.

 

(f)                                   The Company may, from time to time, deem it necessary to enter into an agreement on a temporary basis that provides greater severance benefits than are being provided in Section 1(b) when hiring a new member of the Management Committee or when asking an existing member to relocate or asking a member to take a position substantially different from the member’s current position.  In the event those greater severance benefits are provided for a period longer than 24 months, the benefits under this Agreement shall be enhanced, on a proportionate basis (for example, if such new member’s benefit was increased by 12 months over Employee’s benefit, then Employee’s benefit would be increased by 12 months), to incorporate the increased benefits provided to the other employee.

 

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(g)                                  Notwithstanding Sections 12(b) and 12(c), the Company agrees that in the event Employee has an existing agreement in place with Company with more restrictive non-solicitation and/or non-disclosure terms, those more restrictive terms will govern until their expiration, if any, at which time this Agreement will wholly take effect.  In the event Employee has an existing agreement in place with Company with no or less restrictive non-solicitation and/or non-disclosure terms, the more restrictive terms contained in this Agreement will govern.

 

SECTION 13.    RELIEF

 

(a)                                 Employee expressly acknowledges that the terms of Sections 3 and 4 are material to this Agreement.  Employee further acknowledges and agrees that the Confidential Information acquired during Employee’s employment with the Company is valuable and unique, and that any breach by Employee of the provisions of Sections 3 and 4 will cause the Company irreparable injury and damage that cannot reasonably or adequately be compensated by monetary damages.  Employee, therefore, expressly agrees that the Company shall be entitled to injunctive relief in a court of competent jurisdiction in accordance with the laws of the applicable jurisdiction.

 

(b)                                 The parties agree that injunctive relief is the exclusive remedy that is available to the Company against Employee in the event the Employee breaches this Agreement.

 

(c)                                  If the Company takes no legal action within the Restricted Period, then it shall not be entitled to bring any legal action under this Agreement against Employee or for any extension of the Restricted Period.

 

SECTION 14.                                          ENTIRE AGREEMENT.

 

This Agreement constitutes the entire Agreement and understanding between the Company and the Employee concerning the subject matters hereof and shall supersede and replace any previously executed non-solicitation non-disclosure agreement between the Company and Employee.  No modification, amendment, termination or waiver of this Agreement shall be binding unless in writing and signed by the Employee and a duly authorized representative of the Company.

 

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IN WITNESS WHEREOF, the Company and Employee have duly executed this Agreement under seal as of the day and year first above written.

 

 

	
THE TRAVELERS   COMPANIES, INC.
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
By:
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
Name:
    	
John   P. Clifford Jr.
    	
 
    
	
 
    	
 
    	
 
    
	
Title:
    	
Executive   Vice President and Chief Human Resources Officer
    	
 
    
	
 
    	
 
    	
 
    
	
 
    	
 
    	
 
    
	
XXXXXXX
    	
 
    
	
 
    	
 
    
	
 
    	
 
    

 

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EXHIBIT A

 

Covenants Not to Solicit/Hire/Interfere.  Employee acknowledges and agrees that, by virtue of opportunities derived from Employee’s access to Confidential Information and employment with the Company, Employee is capable of significantly and adversely impacting the existing relationships of the Company Entities with their clients, customers, policyholders, vendors, consultants, employees, and/or agents.  Employee acknowledges that the Company Entities have a legitimate interest in protecting these relationships against solicitation and/or interference by Employee during Employee’s employment and for a reasonable period of time following the Separation Date.  Accordingly, the parties agree that the covenants described in this Subsection III(E) and its subparts shall apply (i) during Employee’s employment with the Company and (ii) for a duration of twelve (12) months following the Separation Date (together, “the Restricted Period”).  Employee acknowledges and agrees that the covenants described in this Subsection III(E) and its subparts are expressly intended to protect and preserve the legitimate business interests and goodwill of the Company Entities.  Employee acknowledges that the Consideration provides independent and fair consideration for these covenants.

 

1.                                      Non-Solicitation/Non-Hire of Employees.  Employee acknowledges that the Company Entities sustain their operations and the goodwill of their clients, customers, policyholders, vendors, consultants, producers, agents and brokers (“Customers”) through their employees.  The Company Entities have made significant investment in their employees and their ability to establish and maintain relationships with each other and with the Company Entities’ Customers in order to further their operations and cultivate goodwill.  Employee acknowledges that the loss of the Company Entities’ employees could adversely affect its operations and jeopardize the goodwill that has been established through these employees, and that the Company Entities therefore have a legitimate interest in preventing the solicitation of their employees.  Accordingly, Employee shall not, without the prior written consent of the Company, at any time during the Restricted Period, directly or indirectly, seek to recruit or solicit, attempt to influence or assist, participate in or promote the solicitation of, or otherwise attempt to adversely affect the employment of any person who was or is employed by any Company Entity on the Separation Date or was employed by any Company Entity within twelve (12) months prior to the Separation Date or thereafter. Without limiting the foregoing restriction, Employee shall not, on behalf of Employee or any other person, hire, employ or engage any such person and shall not engage in the aforesaid conduct through a third party for the purpose of colluding to avoid the restrictions in this Section.  Without limiting the generality of the restrictions under this Section, by way of example, the restrictions under this Section shall prohibit Employee from (i) interviewing a Company Entity employee, (ii) communicating in any manner with a Company Entity employee in connection with a current or future employment opportunity outside of the Company, (iii) identifying Company Entity employees to potentially be solicited or hired, (iv) providing information or feedback regarding Company Entity employees seeking employment with the Employees subsequent employer and/or (v) otherwise assisting or participating in the 

 

 

solicitation or hiring of a Company Entity employee.  Employee further agrees that, during such time, if a person who is employed by any Company Entity contacts Employee about prospective employment, Employee will inform such person that Employee cannot discuss the matter, unless and until consent of the Company has been obtained.  Employee shall not provide any other person the name of, or information regarding, any person employed by any Company Entity who contacts Employee about prospective employment.  For purposes of this Subsection III(E)(1), requests for consent must be delivered via overnight mail (signature required) to John P. Clifford, Jr., Travelers, Executive Vice President of Human Resources, 385 Washington Street, Mail Code SB02W, St. Paul, MN 55102-1396 (or his successor), with a copy via overnight mail (signature required) to Kenneth F. Spence, III, Travelers, Executive Vice President and General Counsel, 385 Washington Street, Mail Code LC12L, St. Paul, MN 55102-1396 (or his successor).

 

2.                                      Non-Solicitation of and Non-Interference with Existing Commercial Relationships.  Employee acknowledges that by virtue of his or her employment with the Company, Employee has developed relationships with and/or had access to Confidential Information about the Company Entities’ Customers and is, therefore, capable of significantly and adversely impacting existing relationships that the Company Entities have with them.  Employee further acknowledges that the Company Entities have invested in their and Employee’s relationship with the Company Entities’ Customers and the goodwill that has been developed with them, and therefore have a legitimate interest in protecting these relationships against solicitation and/or interference by Employee for a reasonable period of time after the Separation Date.  Accordingly, Employee shall not, without the prior written consent of the Company, at any time during the Restricted Period, directly or indirectly, solicit any person or entity, who or that, as of the Separation Date, was or is a Customer of any Company Entity, to discontinue business with any Company Entity and/or move that business elsewhere, or otherwise change an existing customer relationship with any Company Entity.  Employee further agrees that, during such time, if such a Customer contacts Employee about discontinuing business with any Company Entity, and/or moving that business elsewhere, or otherwise changing an existing commercial relationship with any Company Entity, Employee will inform such Customer that Employee cannot discuss the matter without notifying the Company.  Prior to any discussion of the matter, Employee is obligated to notify the Company of the name of the person who made the contact, the Customer with whom the person is affiliated, and the nature and date of the contact. After notifying the Company of the contact, Employee must receive written consent from the Company before discussing the matter with such Customer.  For purposes of this Subsection III(E)(2), requests for consent must be delivered via overnight mail (signature required) to the current Executive Vice President or Senior Vice President of the business unit for which Employee worked as of the Separation Date, with a copy via overnight mail (signature required) to Kenneth F. Spence, III, Travelers, Executive Vice President and General Counsel, 385 Washington Street, Mail Code LC12L, St. Paul, MN 55102-1396 (or his successor).Exhibit 10.37

 

TRAVELERS
 STOCK OPTION GRANT NOTIFICATION AND AGREEMENT

 

(This award must be accepted within 90 days after the Grant Date shown below or it will be forfeited. Refer below to Section 16.)

 

	
Participant:
    	
“NAME”
    	
Grant Date:
    	
“GRANT DATE”
    
	
Number of Shares:
    	
“GRANTED”
    	
Grant Price:
    	
$“GRANT PRICE”
    
	
Expiration Date:
    	
“EXPIRATION DATE ”
    	
Vesting Date:
    	
3 years from Grant Date
    

 

1.                                      Grant of Option. This option is granted pursuant to The Travelers Companies, Inc. Amended and Restated 2014 Stock Incentive Plan, as it may be amended from time to time (the “Plan”), by The Travelers Companies, Inc. (the “Company”) to you (the “Participant”) as an employee of the Company or an affiliate of the Company (together, the “Travelers Group”). The Company hereby grants to the Participant as of the Grant Date a non-qualified stock option (the “Option”) to purchase the number of shares set forth above of the Company’s common stock, no par value (“Common Stock”), at an option price per share (the “Grant Price”) set forth above, pursuant to the Plan, as it may be amended from time to time, and subject to the terms, conditions, and restrictions set forth herein, including, without limitation, the conditions set forth in Section 5.

 

2.                                      Terms and Conditions. The terms, conditions, and restrictions applicable to the Option are specified in the Plan and this grant notification and agreement, including Exhibits A and B (the “Award Agreement”). The terms, conditions and restrictions in the Plan include, but are not limited to, provisions relating to amendment, vesting, cancellation, and exercise, all of which are hereby incorporated by reference into this Award Agreement to the extent not otherwise set forth herein.

 

By accepting the Option, the Participant acknowledges receipt of the prospectus dated February 9, 2017 and any applicable prospectus supplements thereto (together, the “Prospectus”) and that he or she has read and understands the Prospectus.

 

The Participant understands that the Option and all other incentive awards are entirely discretionary and that no right to receive an award exists absent a prior written agreement with the Company to the contrary. The Participant also understands that the value that may be realized, if any, from the Option is contingent, and depends on the future market price of the Common Stock, among other factors. The Participant further confirms his or her understanding that the Option is intended to promote employee retention and stock ownership and to align participants’ interests with those of shareholders. Additionally, the Participant understands that the Option is subject to vesting conditions and will be cancelled if the vesting or other conditions are not satisfied. Thus, the Participant understands that (a) any monetary value assigned to the Option in any communication regarding the Option is contingent, hypothetical, or for illustrative purposes only, and does not express or imply any promise or intent by the Company to deliver, directly or indirectly, any certain or determinable cash value to the Participant; (b) receipt of the Option or any incentive award in the past is neither an indication nor a guarantee that an incentive award of any type or amount will be made in the future, and that absent a written agreement to the contrary, the Company is free to change its practices and policies regarding incentive awards at any time; and (c) vesting may be subject to confirmation and final determination by the Company’s Board of Directors or its Compensation Committee (the “Committee”) that the vesting conditions have been satisfied.

 

The Participant shall have no rights as a stockholder of the Company with respect to any shares covered by the Option unless and until the Option vests, is properly exercised and shares of Common Stock are issued.

 

3.                                      Vesting. The Option shall vest in full and become exercisable on the Vesting Date set forth above, provided the Participant remains continuously employed within the Travelers Group. The Option shall in all events expire on the tenth (10th) anniversary of the Grant Date set forth above. If the Participant has a termination of, or leave from active employment prior to exercise or expiration of the Option, the Participant’s rights are determined under the Option Rules of Exhibit A.

 

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4.                                      Exercise of Option. The Option may be exercised in whole or in part by the Participant after the Vesting Date (or the date provided pursuant to Exhibit A) upon notice to the Company together with provision for payment of the Grant Price and applicable withholding taxes. Such notice shall be given in the manner prescribed by the Company and shall specify the date and method of exercise and the number of shares being exercised. The Participant acknowledges that the laws of the country in which the Participant is working at the time of grant or exercise of the Option (including any rules or regulations governing securities, foreign exchange, tax, or labor matters) or Company accounting or other policies dictated by such country’s political or regulatory climate, may restrict or prohibit any one or more of the stock option exercise methods described in the Prospectus, that such restrictions may apply differently if the Participant is a resident or expatriate employee, and that such restrictions are subject to change at any time. The Committee may suspend the right to exercise the Option during any period for which (a) there is no registration statement under the Securities Act of 1933, as amended, in effect with respect to the shares of Common Stock issuable upon exercise of the Option, or (b) the Committee determines, in its sole discretion, that such suspension would be necessary or advisable in order to comply with the requirements of (i) any applicable federal securities law or rule or regulation thereunder; (ii) any rule of the New York Stock Exchange or other self-regulatory organization; or (iii) any other federal or state law or regulation (an “Option Exercise Suspension”). To the extent the vested and exercisable portion of the Option remains unexercised as of the close of business on the date the Option expires (the Expiration Date or such earlier date that is the last date on which the Option may be exercised under the Option Rules of Exhibit A if the Participant’s employment with the Travelers Group has ended), that portion of the Option will be exercised without any action by the Participant in accordance with Section 7.5 of the Plan if the Fair Market Value of a share of Common Stock on that date is at least $0.01 greater than the Grant Price, the exercise will result in Participant receiving at least one incremental share, and no Option Exercise Suspension is then in effect.

 

5.                                      Grant Conditioned on Principles of Employment Agreement.

 

By entering into this Award Agreement, the Participant shall be deemed to have confirmed his or her agreement to be bound by the Company’s Principles of Employment Agreement in effect on the date immediately preceding the Grant Date (the “POE Agreement”), as published on the Company’s intranet site or previously distributed in hard copy to the Participant. Furthermore, by accepting the Option, the Participant agrees that the POE Agreement shall supersede and replace the form of Principles of Employment Agreement contained or referenced in any Prior Equity Award (as defined below) made by the Company to the Participant, and, accordingly, such Prior Equity Award shall become subject to the terms and conditions of the POE Agreement.

 

6.                                      Acceptance of Exhibits A and B. The Participant agrees to be bound by the terms of the Option Rules set forth in Exhibits A and B (“Option Rules”).

 

7.                                      Acceptance of and Agreement to Non-Solicitation and Confidentiality Conditions. In consideration for the award of Options under this Award Agreement, the Participant agrees that the Option is conditioned upon Participant’s compliance with the following non-solicitation and confidentiality conditions (the “Non-Solicitation Conditions” and the “Confidentiality Conditions,” respectively):

 

(a)           The Company and the Participant understand, intend and agree that the Non-Solicitation Conditions of this Section 7 are intended to protect the Travelers Group and other participants in the Plan against the Participant soliciting its employees and/or its business during the twelve (12) month period (the “Restricted Period”) following the date of the Participant’s termination of employment with the Travelers Group (whether voluntary or involuntary) as reflected on the Travelers Group’s books and records (the “Termination Date”), while recognizing that after the Termination Date the Participant is still permitted to compete with the Travelers Group subject to the restrictions set forth below. Nothing in this Section 7 is intended to limit any of the Travelers Group’s rights or claims as to any future employer of the Participant.

 

(b)                                 Non-Solicitation of Employees. The Participant acknowledges that the Travelers Group sustains its operations and the goodwill of its clients, customers, policyholders, producers, agents and brokers (its “Customers”) through its employees. The Travelers Group has made significant investment in its employees and their ability to establish and maintain relationships with each 

 

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other and with the Travelers Group’s Customers in order to further its operations and cultivate goodwill. The Participant acknowledges that the loss of the Travelers Group’s employees could adversely affect its operations and jeopardize the goodwill that has been established through these employees, and that the Travelers Group therefore has a legitimate interest in preventing the solicitation of its employees. During the Restricted Period, the Participant will not, directly or indirectly, seek to recruit or solicit, attempt to influence or assist, participate in, or promote the solicitation of, or otherwise attempt to adversely affect the employment of any person who was or is employed by the Travelers Group at any time during the last three months of the Participant’s employment or during the Restricted Period. Without limiting the foregoing restriction, the Participant shall not, on behalf of himself or herself or any other person, hire, employ or engage any such person and  shall not engage in the aforesaid conduct through a third party for the purpose of colluding to avoid the restrictions in this Section 7. Without limiting the generality of the restrictions under this Section, by way of example, the restrictions under this Section shall prohibit the Participant from (i) interviewing a Travelers Group employee, (ii) communicating in any manner with a Travelers Group employee in connection with a current or future employment opportunity outside of the Travelers Group, (iii) identifying Travelers Group employees to potentially be solicited or hired, (iv) providing information or feedback regarding Travelers Group employees seeking employment with the Participant’s subsequent employer and/or (v) otherwise assisting or participating in the solicitation or hiring of  a Travelers Group employee. However, the Non-Solicitation Conditions do not preclude the Participant from directing a third party (including but not limited to employees of his/her subsequent employer or a search firm) to broadly solicit, recruit, and hire individuals, some of whom may be employees of the Travelers Group, provided that the Participant does not direct such third party specifically to target employees of the Travelers Group generally or specific individual employees of the Travelers Group.

 

(c)                                  Non-Solicitation of Business. The Participant acknowledges that by virtue of his or her employment with the Travelers Group, he or she may have developed relationships with and/or had access to Confidential Information (as defined below) about the Travelers Group’s Customers and is, therefore, capable of significantly and adversely impacting existing relationships that the Travelers Group has with them. The Participant further acknowledges that the Travelers Group has invested in its and the Participant’s relationship with its Customers and the goodwill that has been developed with them and therefore has a legitimate interest in protecting these relationships against solicitation and/or interference by the Participant for a reasonable period of time after the Participant’s employment with the Travelers Group ends. If, after the Termination Date, the Participant accepts a position as an employee, consultant or contractor with a “Competitor” (as defined below), then, during the Restricted Period, the Participant will not, directly or indirectly, solicit, interfere with or attempt to influence any Customer of the Travelers Group to discontinue business with the Travelers Group and/or move existing or future business of the Travelers Group elsewhere. This restriction applies with respect to any business of any current or prospective client, customer or policyholder of the Travelers Group (i) on which the Participant, or anyone reporting directly to him or her, worked or was actively engaged in soliciting or servicing or (ii) about which the Participant gained access to Confidential Information (as defined below) during the Participant’s employment with the Travelers Group. In addition to the foregoing restriction, the Participant agrees not to be personally involved in the negotiation, competition for, solicitation or execution of any individual book roll over(s) or other book of business transfer arrangements involving the transfer of business away from the Travelers Group, at any time during the twenty-four month period following the Termination Date (the “Enhanced Restricted Period”). The Participant may, at any time after the Termination Date, broadly direct a third party (including but not limited to employees of his/her subsequent employer) to negotiate, compete for, solicit and execute such book roll over(s) or other book of business transfer arrangements, provided that (i) the Participant is not personally involved in such activities and (ii) the Participant does not direct such third party specifically to target business of the Travelers Group. As used herein, “Competitor” shall include any business enterprise or organization, including, without limitation, agents, brokers and producers, that engages in, owns or controls a significant interest in any entity that engages in the sale of products and/or performance of services of the type sold or performed by the Travelers Group and/or provides advice relating to such products and services.

 

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(d)                                 Subject to the non-competition obligations in the Option Rules that apply to Participants meeting the “Retirement Rule,” at any time after the Termination Date, the Participant may otherwise compete with the Travelers Group, including but not limited to competing on an account by account or deal by deal basis, to the extent that he or she does not violate the provisions of subsection (c) above or any other contractual, statutory or common law obligations to the Travelers Group.

 

(e)                                  Notwithstanding anything herein to the contrary, if the Participant breaches any of the Non-Solicitation Conditions of this Section 7, then the Restricted Period (or the Enhanced Restricted Period, if applicable) will be extended until the date that is 12 months (or 24 months , in the case of a breach under Section 7(c) with respect to the restrictions applicable during the Enhanced Restricted Period) after the date of the Participant’s last breach of such Non-Solicitation Conditions.

 

(f)                                   The Participant agrees not to, either during or after his or her employment, use, publish, make available, or otherwise disclose, except for benefit of the Travelers Group in the course of such employment, any technical or confidential information (“Confidential Information”) developed by, for, or at the expense of the Travelers Group, or assigned or entrusted to the Travelers Group, unless such information is generally known outside of the Travelers Group. Confidential Information includes, but is not limited to, non-public information such as: internal information about the Travelers Group’s business, such as financial, sales, marketing, claim, technical and business information, including profit and loss statements, business/marketing strategy and “Trade Secrets” (as defined below); client, customer, policyholder, insured person, claimant, vendor, consultant and agent information, including personal information such as social security numbers and medical information; legal advice obtained; product and system information; and any compilation of this information or employee information obtained as part of the Participant’s responsibilities at the Travelers Group.  As used herein, “Trade Secrets” shall include information relating to the Travelers Group and its affiliates that is protectable as a trade secret under applicable law, including, without limitation, and without regard to form:  technical or non-technical data, a formula, a pattern, a compilation, a program, a device, a method, a technique, a drawing, a process, financial data, financial plans, business and strategic plans, product plans, source code, software, unpublished patent applications, customer proposals or pricing information or a list of actual or potential customers or suppliers which is not commonly known by or available to the public and which information derives economic value, actual or potential, from not being generally known to, and not being readily ascertainable by proper means by, other persons who can obtain economic value from its disclosure or use. In addition, the Participant will keep at all times subject to the Travelers Group’s control and will deliver to or leave with the Travelers Group all written and other materials in any form or medium (including, but not limited to, print, tape, digital, computerized and electronic data, parts, tools, or equipment) containing such technical or Confidential Information upon termination of the Participant’s employment. The Participant also agrees to cooperate to remedy any unauthorized use of such information and not to violate any Travelers Group policy regarding same. The Participant agrees that all records, reports, notes, compilations, or other recorded matter, and copies or reproductions thereof, relating to the Travelers Group’s operations, activities, Confidential Information, or business, made or received by the Participant during the Participant’s employment with any member(s) of the Travelers Group are, and shall be, the property of the Travelers Group exclusively, and the Participant will keep the same at all times subject to the Travelers Group’s control and will deliver or leave with the Travelers Group the same at the termination of the Participant’s employment.

 

(g)                                  Protected Disclosures. Nothing herein should be construed as prohibiting the Participant from sharing information concerning the Participant’s own wages (or the wages of another employee, if voluntarily disclosed by that employee) or other terms and conditions of employment, or for purposes of otherwise pursuing the Participant’s legal rights. The Travelers Group will not terminate, discipline or otherwise discriminate or retaliate against any employee because they make such a disclosure. The Travelers Group, does however, prohibit employees who have access to other employee’s wage information as part of their job functions from sharing such information gathered during the course of their employment, unless disclosure is in furtherance of or in response to their job duties, an investigation, action or hearing, or the employee otherwise has a legal obligation to furnish the information. For example, an employee who has access to 

 

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the salaries of other employees due to his or her job responsibilities generally may not disclose the salary of those co-workers. This Agreement also does not permit an employee to disclose (without written consent of the Travelers Group) Confidential Information or permit an employee to disclose wage information of other employees to a competitor.  Additionally, nothing herein is intended to prohibit or restrict the Participant from (i) filing a complaint with, making disclosures to, communicating with or participating in an investigation or proceeding conducted by any governmental agency (including the United States Equal Employment Opportunity Commission and the Securities and Exchange Commission), (ii) pursuing the Participant’s legal rights related to the Participant’s employment with the Travelers Group, or (iii) engaging in activities protected by applicable laws or regulations. Employees will not be held criminally or civilly liable under any Federal or State trade secret law for the disclosure of a trade secret that is made (i) in confidence to a Federal, State or local government official, either directly or indirectly, or to an attorney, solely for the purpose of reporting or investigating a suspected violation of law or (ii) in a complaint or other document filed in a lawsuit or other proceeding, if such filing is under seal. Notwithstanding, the Travelers Group does not authorize the waiver of, or disclosure of information covered by, the attorney-client privilege or attorney work product doctrine or any other privilege belonging to the Travelers Group.

 

(h)                                 If the final judgment of a court of competent jurisdiction declares that any term or provision of this Section 7 is invalid or unenforceable, the parties agree that (i) the court making the determination of invalidity or unenforceability shall have the power to reduce the scope, duration, or geographic area of the term or provision, to delete specific words or phrases, or to replace any invalid or unenforceable term or provision with a term or provision that is valid and enforceable and that comes closest to expressing the intention of the invalid or unenforceable term or provision, (ii) the parties shall request that the court exercise that power, and (iii) this Award Agreement shall be enforceable as so modified after the expiration of the time within which the judgment or decision may be appealed.

 

(i)                                     During the Restricted Period or any extension thereof, the Participant shall notify any subsequent employer of his or her obligations under this Award Agreement prior to commencing employment. During the Restricted Period or any extension thereof, the Participant will provide the Company and his or her prior manager at the Travelers Group fourteen (14) days’ advance written notice prior to becoming associated with and/or employed by any person or entity or engaging in any business of any type or form, with such notice including the identity of the prospective employer or business, the specific division (if applicable) for which the Participant will be performing services and the title or position to be assumed by the Participant. The Participant must provide a copy of such notice to the Company’s Employee Services Unit by email, facsimile or regular mail as follows:

 

Email:            4-ESU@travelers.com

 

Fax:                       1.866.871.4378 (U.S. and Canada)

001.866.871.4378 (Europe)

 

Mail:                   The Travelers Companies, Inc.

Employee Services Unit

385 Washington Street

Mail Code: 9275-SB02L

St. Paul, MN  USA 55102

 

(j)                                    As consideration for and by accepting the Option, the Participant agrees that the Non-Solicitation Conditions and Confidentiality Conditions of this Section 7 shall supersede any non-solicitation and confidentiality covenants contained or incorporated in any prior equity award made by the Company to the Participant under the Plan, The Travelers Companies, Inc. Amended and Restated 2004 Stock Incentive Plan, the Travelers Property Casualty Corp. 2002 Stock Incentive Plan, or The St. Paul Companies, Inc. Amended and Restated 1994 Stock Incentive Plan (“Prior Equity Awards”); accordingly, such Prior Equity Awards shall become subject to the terms and conditions of the Non-Solicitation Conditions and Confidentiality Conditions of this Section 7. However, these Non-Solicitation Conditions and Confidentiality Conditions shall be in addition to, 

 

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and shall not supersede, any non-solicitation, non-competition, confidentiality, intellectual property or other restrictive covenants contained or incorporated in (i) any Non-Competition Agreement between any member(s) of the Travelers Group and the Participant arising out of the Participant’s service as a Management Committee member or otherwise, (ii) any employment agreement or other agreement between any member(s) of the Travelers Group and the Participant (other than such Prior Equity Awards), or (iii) any other Travelers Group plan or policy that covers the Participant (other than such Prior Equity Awards).

 

8.                                      Forfeiture of Option Awards.

 

(a)                                 Participant’s Agreement. The Participant expressly acknowledges that the terms of Section 7 and this Section 8 are material to this Agreement and reasonable and necessary to protect the legitimate interests of the Travelers Group, including without limitation, the Travelers Group’s Confidential Information, trade secrets, customer and supplier relationships, goodwill and loyalty, and that any violation of these Non-Solicitation Conditions or Confidentiality Conditions by the Participant would cause substantial and irreparable harm to the Travelers Group and other Participants in the Plan. The Participant further acknowledges and agrees that:

 

(i)                                     The receipt of the Option constitutes good, valuable and independent consideration for the Participant’s acceptance of and compliance with the provisions of the Award Agreement, including the forfeiture and repayment provision of subsection 8(b) below and the Non-Solicitation Conditions and Confidentiality Conditions of Section 7 above, and the amendment of Prior Equity Award provisions of subsection 7(i), 8(f) and Section 18, below.

 

(ii)                                  The Participant’s rights with respect to the Option are conditioned on his or her compliance with the POE Agreement at all times after acceptance of the POE Agreement in accordance with Sections 5 and 16 hereunder.

 

(iii)                               The scope, duration and activity restrictions and limitations described in this Agreement are reasonable and necessary to protect the legitimate business interests of the Travelers Group. The Participant acknowledges that all restrictions and limitations relating to the Restricted Period will apply regardless of the reason the Participant’s employment ends. The Participant further agrees that any alleged claims the Participant may have against the Travelers Group do not excuse the Participant’s obligations under this Award Agreement.

 

(b)                                 Forfeiture and Repayment Provisions. The Participant agrees that, prior to the Termination Date and during the Restricted Period (or the Enhanced Restricted Period, as applicable), if the Participant breaches the Non-Solicitation Conditions, the Confidentiality Conditions and/or the POE Agreement, in addition to all rights and remedies available to the Travelers Group at law and in equity (including without limitation those set forth in the Option Rules for involuntary termination), the Participant will immediately forfeit any portion of the Option under this Award Agreement that has not otherwise been previously forfeited under the Award Rules in Exhibit A and that has not yet been paid, exercised, settled or vested. The Company may also require repayment from the Participant of any and all compensatory value that the Participant received for the last twelve (12) months of his or her employment and through the end of the Restricted Period (or the Enhanced Restricted Period, as applicable) from this Option or any Prior Equity Awards (including without limitation the gross amount of any Common Stock distribution or cash payment made to the Participant upon the vesting, distribution, exercise, or settlement of any such awards and/or any consideration in excess of such gross amounts received by the Participant upon the sale or transfer of the Common Stock acquired through vesting, distribution, exercise, or settlement of any such awards). The Participant will promptly pay the full amount due upon demand by the Company, in the form of cash or shares of Common Stock at current Fair Market Value.

 

(c)                                  No Limitation on the Travelers Group’s Rights or Remedies. The Participant acknowledges and agrees that the forfeiture and repayment remedies under subsection 8(b) are non-exclusive remedies and shall not limit or modify the Travelers Group’s other rights and remedies to obtain 

 

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other monetary, equitable or injunctive relief as a result of breach of, or in order to enforce, the terms and conditions of this Agreement or with respect to any other covenants or agreements between the Travelers Group and the Participant or the Participant’s obligations under applicable law.

 

(d)                                 Option Rules. The Option Rules provide a right to payment, subject to certain conditions, following the Participant’s Termination Date if the Participant meets the Retirement Rule which, among other conditions, may require that the Participant not engage in any activities that compete with the business operations of the Travelers Group through the settlement or exercise date of the Option (such non-compete condition may extend beyond the Restricted Period). The remedies for a violation of such non-compete conditions are specified in the Option Rules and are in addition to any remedies of the Travelers Group under this Section 8.

 

(e)                                  Severability. If any court determines that any of the terms and conditions of Section 7 or this Section 8 are invalid or unenforceable, the remainder of the terms and conditions shall not thereby be affected and shall be given full effect, without regard to the invalid portions. If any court determines that any of the terms and conditions are unenforceable because of the duration of such terms and conditions or the area covered thereby, such court shall have the power to reduce the duration or area of such terms and conditions and, in their reduced form, the terms and conditions shall then be enforceable and shall be enforced.

 

(f)                                   Awards Subject to Recoupment. Except to the extent prohibited by law, this Option and any outstanding Prior Equity Award may be forfeited, and the compensatory value received under such awards (including without limitation the gross amount of any Common Stock distribution or cash payment made to the Participant upon the vesting, distribution, exercise or settlement of such awards, or consideration in excess of such gross amounts received by the Participant upon the sale or transfer of the Common Stock acquired through vesting, distribution, exercise or settlement of such awards) may be subject to recoupment by the Company, in accordance with the Company’s executive compensation recoupment policy and other policies in effect from time to time with respect to forfeiture and recoupment of bonus payments, retention awards, cash or stock-based incentive compensation or awards, or similar forms of compensation, and the terms of any such policy, while it is in effect, are incorporated herein by reference. As consideration for and by accepting the Award Agreement, the Participant agrees that all the remedy and recoupment provisions of this Section 8 shall apply to any Prior Equity Award made by the Company to the Participant, shall be in addition to and shall not supersede any other remedies contained or referenced in any such Prior Equity Award, and, accordingly, such Prior Equity Award shall become subject to both those other remedies and the terms and conditions of this Section 8.

 

(g)                                  Survival of Provisions. The agreements, covenants, obligations, and provisions contained in Section 7 and this Section 8 shall survive the Participant’s Termination Date and the expiration of this Award Agreement, and shall be fully enforceable thereafter.

 

9.                                      Consent to Electronic Delivery. In lieu of receiving documents in paper format, the Participant agrees, to the fullest extent permitted by law, to accept electronic delivery of any documents that the Company desires or may be required to deliver (including, but not limited to, prospectuses, prospectus supplements, grant or award notifications and agreements, account statements, annual and quarterly reports, and all other agreements, forms and communications) in connection with this and any other prior or future incentive award or program made or offered by the Company or its predecessors or successors. Electronic delivery of a document to the Participant may be via a Company e-mail system or by reference to a location on a Company intranet site to which the Participant has access.

 

10.                               Administration. The Company’s Compensation Committee or its designee administers the Plan and this Award Agreement and has the authority to interpret any ambiguous or inconsistent terms in its sole discretion. The Participant’s rights under this Award Agreement are expressly subject to the terms and conditions of the Plan and to any guidelines the Compensation Committee or its designee adopts from time to time. The interpretation and construction by the Compensation Committee or its designee of the Plan and this Award Agreement, and such rules and regulations as the Compensation Committee or 

 

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its designee may adopt for purposes of administering the Plan and this Award Agreement, will be final and binding upon the Participant.

 

11.                               Entire Agreement/Amendment/Survival/Assignment. The terms, conditions and restrictions set forth in the Plan and this Award Agreement constitute the entire understanding between the parties hereto regarding the Option and supersede all previous written, oral, or implied understandings between the parties hereto about the subject matter hereof. This Award Agreement may be amended by a subsequent writing (including e-mail or electronic form) agreed to between the Company and the Participant. Section headings herein are for convenience only and have no effect on the interpretation of this Award Agreement. The provisions of the Award Agreement that are intended to survive the Termination Date of a Participant, specifically including Sections 7 and 8 hereof, shall survive such date. The Company may assign this Award Agreement and its rights and obligations hereunder to any current or future member of the Travelers Group.

 

12.                               No Right to Employment. The Participant agrees that nothing in this Award Agreement constitutes a contract of employment with the Travelers Group for a fixed duration of time. The employment relationship is “at will,” which affords the Participant or the Travelers Group the right to terminate the relationship at any time for any reason or no reason not otherwise prohibited by applicable law. The Travelers Group retains the right to decrease the Participant’s compensation and/or benefits, transfer or demote the Participant or otherwise change the terms or conditions of the Participant’s employment with the Travelers Group. The Option granted hereunder will not form part of the Participant’s regular employment compensation and will not be considered in calculating any statutory benefits or severance pay due to the Participant.

 

13.                               No Limitation on the Company’s Rights. The Participant agrees that nothing in this Award Agreement shall in any way affect the Company’s right or power to make adjustments, reclassifications or changes in its capital or business structure or to merge, consolidate, reincorporate, dissolve, liquidate or sell or transfer all or any part of its business or assets.

 

14.                               Transfer Restrictions. The Participant may not sell, assign, transfer, pledge, encumber or otherwise alienate, hypothecate or dispose of the Option or his or her right under the Option to receive shares of Common Stock, except as otherwise provided in the Prospectus.

 

15.                               Conflict. In the event of a conflict between the Plan and the Award Agreement the Plan terms shall govern.

 

16.                               Acceptance and Agreement by the Participant; Forfeiture upon Failure to Accept. By accepting this Option, the Participant agrees to be bound by the terms, conditions, and restrictions set forth in the Plan, this Award Agreement, and the Travelers Group’s policies, as in effect from time to time, relating to the Plan. The Participant’s rights under the Option will lapse ninety (90) days from the Grant Date, and the Option will be forfeited on such date if the Participant does not accept the Award Agreement by such date. For the avoidance of doubt, the Participant’s failure to accept the Award Agreement shall not affect his or her continuing obligations under any other agreement between any member(s) of the Travelers Group and the Participant.  Additionally, the Participant acknowledges and agrees that the Participant’s acceptance of this Option is voluntary and not a condition of employment, and the Participant may decline to accept this Option without adverse consequences to the Participant’s continued employment relationship with the Travelers Group.

 

17.                               Waiver; Cumulative Rights. The Company’s failure or delay to require performance by the Participant of any provision of this Award Agreement will not affect its right to require performance of such provision unless and until the Company has waived such performance in writing. Each right under this Award Agreement is cumulative and may be exercised in part or in whole from time to time.

 

18.                               Governing Law and Forum for Disputes. The Award Agreement shall be legally binding and shall be executed and construed and its provisions enforced and administered in accordance with the laws of the State of Minnesota. The jurisdiction and venue for any disputes arising under, or any action brought to enforce (or otherwise relating to), this Agreement will be exclusively in the courts in the State of Minnesota, City and County of St. Paul, including the Federal Courts located therein (should Federal jurisdiction exist). The parties consent to and submit to the personal jurisdiction and venue of courts of 

 

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Minnesota and irrevocably waive any claim or argument that the courts in Minnesota are an inconvenient forum. The Participant agrees to accept service of any court filings and process by delivery to his or her most current home address on record with the Travelers Group via first class mail or other nationally recognized overnight delivery provider, or by any third party regularly engaged in the service of process.  As consideration for and by accepting the Option, the Participant agrees that the Governing Law and Forum for Disputes provision of this Section 18 shall supersede any governing law, forum or similar provisions contained or referenced in any Prior Equity Award made by the Company to the Participant, and, accordingly, such Prior Equity Award shall become subject to the terms and conditions of the Governing Law and Forum for Disputes provisions of this Section 18.

 

19.                               Personal Data. The Participant understands that the Company and other members of the Travelers Group hold certain personal information about the Participant, which may include, without limitation, information such as his or her name, home address, telephone number, gender, date of birth, salary, nationality, job title, social insurance number or other such tax identity number and details of all awards or other entitlement to shares of common stock awarded, cancelled, exercised, vested, unvested or outstanding in his or her favor (“Personal Data”).

 

The Participant understands that in order for the Company to process the Participant’s Option and maintain a record of Options under the Plan, the Company shall collect, use, transfer and disclose Personal Data within the Travelers Group electronically or otherwise, as necessary for the implementation and administration of the Plan including, in the case of a social insurance number, for income reporting purposes as required by law. The Participant further understands that the Company may transfer Personal Data, electronically or otherwise, to third parties, including but not limited to such third parties as outside tax, accounting, technical and legal consultants when such third parties are assisting the Company or other members of the Travelers Group in the implementation and administration of the Plan. The Participant understands that such recipients may be located within the jurisdiction of residence of the Participant, or within the United States or elsewhere and are subject to the legal requirements in those jurisdictions applicable to those organizations, for example, lawful requirements to disclose personal information such as the Personal Data to government authorities in those countries. The Participant understands that the employees of the Travelers Group and third parties performing work related to the implementation and administration of the Plan shall have access to the Personal Data as is necessary to fulfill their duties related to the implementation and administration of the Plan. By accepting the Option, the Participant consents, to the fullest extent permitted by law, to the collection, use, transfer and disclosure, electronically or otherwise, of his or her Personal Data by or to such entities for such purposes and the Participant accepts that this may involve the transfer of Personal Data to a country which may not have the same level of data protection law as the country in which this Award Agreement is executed. The Participant confirms that if the Participant has provided or, in the future, will provide Personal Data concerning third parties including beneficiaries, the Participant has the consent of such third party to provide their Personal Data to the Travelers Group for the same purposes.

 

The Participant understands that he or she may, at any time, request to review the Personal Data and require any necessary amendments to it by contacting the Company in writing. Additionally, the Participant may always elect to forgo participation in the Plan or any other award program.

 

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EXHIBIT A

 

OPTION RULES
 TO TRAVELERS’ STOCK OPTION GRANT NOTIFICATION AND AGREEMENT

 

When you leave the Travelers Group

 

References to “you” or “your” are to the Participant. “Termination Date” is defined in Section 7(a) of the Award Agreement and means the date of the termination of your employment with the Travelers Group (whether voluntary or involuntary) as reflected on the books and records of the Travelers Group.

 

If you terminate your employment or if there is a break in your employment, your Option may be cancelled before the end of the vesting period and the vesting and exercisability of your Option may be affected.

 

The provisions in the chart below apply to Options granted under the Plan. Depending upon your employment jurisdiction upon the Grant Date, special rules may apply for vesting, payment, exercise and exercisability of your Option in cases of termination of employment if you satisfy certain age and years of service requirements (“Retirement Rule”), as set forth in “Retirement Rule” below. Participants based in countries outside the United States on the Grant Date or in California immediately prior to the Termination Date should refer to Exhibit B for special rules that apply. For the avoidance of doubt, the applicable vesting terms for your Option pursuant to Exhibits A and B shall be based on your employment jurisdiction on the Grant Date.

 

If any Option exercisability period set forth in the chart below or under “Retirement Rule” below would otherwise expire during an Option Exercise Suspension, the Option shall remain exercisable for a period of 30 days after the Option Exercise Suspension (as defined in Section 4 of the Award Agreement) is lifted by the Company (but no later than the original option expiration date, which is the tenth (10th) anniversary of the Grant Date).

 

	
If You:
    	
 
    	
Here’s What Happens to Your Options:
    
	
Terminate   employment or your employment is terminated by the Travelers Group for any   reason other than due to death or disability (but you do not meet the   Retirement Rule and you do not qualify for accelerated vesting following   a Change of Control, as described below)
    	
 
    	
Vesting stops   and unvested options are cancelled effective on the Termination Date. You may   exercise your vested options for up to 90 days after the Termination Date but   no later than the original option expiration date; provided, however, that if   your employment is terminated for cause or gross misconduct (as determined by   the Company in its sole discretion) or you voluntarily terminated your   employment where grounds for involuntary termination for gross misconduct or   for cause existed (as determined by the Company in its sole discretion at the   time of or following your termination of employment) you may not exercise   vested options at any time after the Termination Date.
    
	
Become   disabled (as defined under the Travelers Group’s applicable long-term   disability plan or policy covering disabilities in your employment   jurisdiction)
    	
 
    	
Options continue   to vest on schedule through an approved disability leave. Upon the earlier of   the (i) Termination Date or (ii) the first anniversary of the   commencement of your approved disability leave, your unvested options will   vest, and you may exercise your options for up to one year from such date,   but no later than the original option expiration date.
    
	
Take   an approved personal leave of absence approved by the Travelers Group under   its Personal Leave Policy, if applicable
    	
 
    	
For the first   three months of an approved personal leave, vesting continues. If the   approved leave exceeds three months, vesting is suspended until 
    

 

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you return to work with the Travelers Group and   remain actively employed for 30 calendar days, after which time vesting will   be restored retroactively. Vested options may be exercised during approved   leave, but no later than the original option expiration date. If you   terminate employment for any reason during the first year of an approved   leave, the termination of employment provisions will apply. If the leave   exceeds one year, all options will be cancelled immediately.
    
	
Are on an approved family leave, medical leave,   dependent care leave, military leave, or other statutory leave of absence or   notice leave (including, without limitation, “garden leave” but not including   any period corresponding to pay in lieu of notice, severance pay or other   monies on account of the cessation of your employment)
    	
 
    	
Options will continue to vest on schedule, and you   may exercise vested options during the leave but no later than the original   option expiration date.
    
	
Die while employed or following employment while   your option is still outstanding
    	
 
    	
Options fully vest upon death. Your estate may   exercise options for up to one year from the date of death but no later than   the original option expiration date.
    
	
Are involuntarily terminated without “Cause” (as   defined below) or terminate employment for “Good Reason” (as defined below),   in each case, within 24 months following a Change of Control (as defined in   the Plan), and including, without limitation, if such involuntary termination   without “Cause” or termination for “Good Reason” within 24 months following a   Change of Control occurs after the onset of a disability or other approved   leave or after meeting the Retirement Rule
    	
 
    	
Unvested options fully vest on the Termination Date.   You may exercise your vested options for up to 90 days after the Termination   Date (or up to one year after the Termination Date if you are disabled on the   Termination Date, or up to three years after the Termination Date if you meet   the Retirement Rule) but in any case no later than the original option   expiration date.
    

 

The terms “Cause” and “Good Reason”, as used above, shall only be applicable with respect to a termination of employment that occurs within 24 months following a Change of Control and shall have the following meanings:

 

“Cause” shall mean your conviction of any felony (or equivalent crime committed outside the United States), your willful misconduct in connection with the performance of your duties with the Company, or your taking illegal action in your business or personal life that harms the reputation or damages the good name of the Company.

 

“Good Reason” shall mean (i) a material reduction in your base salary or bonus opportunity (except for year over year reductions in payout due to performance), (ii) a material diminution in your title, duties, or responsibilities (other than solely by reason of the Company ceasing to be a publicly traded company), or (iii) an involuntary relocation of more than 30 miles of your principal place of business. Notwithstanding the foregoing, no event shall constitute Good Reason unless and until you have notified the Company in writing describing the event which constitutes Good Reason and then only if the Company shall fail to cure such event within thirty (30) days following its receipt of such written notice; provided, further, that “Good Reason” shall cease to exist for an event on the 90th day following the later of its occurrence or your knowledge thereof, unless you have given the Company written notice thereof prior to such date.

 

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Retirement Rule

 

If, as of your Termination Date (including, without limitation, a Termination Date that occurs after the onset of a disability or other approved leave), you are at least (i) age 65, (ii) age 62 with one or more full years of service, or (iii) age 55 with 10 or more full years of service, then you meet the “Retirement Rule.”

 

The Retirement Rule will not apply to your Option or any Prior Equity Award if you were involuntarily terminated for gross misconduct or for cause (as determined by the Company in its sole discretion at the time of or following your termination of employment) or you voluntarily terminated your employment where grounds for involuntary termination for gross misconduct or for cause existed (as determined by the Company in its sole discretion at the time of or following your termination of employment); provided, however, that if such termination occurs within 24 months following a Change of Control, the Retirement Rule will only not apply to your Option or any Prior Equity Award if you are involuntarily terminated for “Cause” (as defined above) or if you voluntarily terminate employment where grounds for “Cause” (as defined above) existed. If you retire and do not meet the Retirement Rule, you will be considered to have resigned.

 

	
If You:
    	
 
    	
 
    
	
Meet the Retirement 
   Rule (subject to 
   Exhibit B if 
   applicable)
    	
 
    	
Unvested options fully vest on the Termination Date.   Vested options may be exercised for up to three years from the Termination   Date, but no later than the original option expiration date, provided that   you do not engage in any activities that compete with the business operations   of the Travelers Group (as determined by the Company in its sole discretion),   including, but not limited to, working for another insurance company engaged   in the property casualty insurance business as either an employee or   independent contractor. You are not subject to this non-compete provision if   you are terminated involuntarily or if you are employed in any state where state   law prohibits such non-compete provisions, but you remain subject to Sections   7 and 8 of the Award Agreement, and the POE Agreement.
    
    When you exercise any options subject to the   Retirement Rule, your exercise will represent and constitute your certification   to the Company that you have not engaged in any activities that compete with   the business operations of the Travelers Group since your Termination Date. You   may be required to provide the Company with other evidence of your compliance   with the Retirement Rule as the Company may require. In the event that   you are determined to have engaged in competitive activities while receiving   the benefit of continued vesting pursuant to the Retirement Rule (other   than following an involuntary termination), any outstanding portion of the   Option will be immediately forfeited and any portion of the Option previously   paid to you will be subject to recoupment by the Company in accordance with   Section 8(f) of the Award Agreement.
    

 

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EXHIBIT B

 

Special Rules Applicable to Participants Based in Certain Jurisdictions

 

Terms and Conditions

 

This Exhibit B includes additional and/or alternative terms and conditions that govern the Option granted to the Participant under The Travelers Companies, Inc. Amended and Restated 2014 Stock Incentive Plan (the “Plan”) if the Participant is employed in one of the jurisdictions listed below on the Grant Date or on the Termination Date if the Participant is employed in California immediately prior to such Termination Date. Capitalized terms used but not defined in this Exhibit B are defined in the Plan and/or Award Agreement and have the meanings set forth therein. To the extent that this Exhibit B is applicable to the Participant (based on the Participant’s place of employment on the Grant Date or on the Termination Date if the Participant is employed in California immediately prior to such Termination Date), the provisions set forth in this Exhibit B will apply to the Participant and will supersede the corresponding provisions set forth in the Award Agreement with respect to the Participant.

 

Notifications

 

This Exhibit B also includes information regarding exchange controls and certain other issues of which the Participant should be aware with respect to the Participant’s participation in the Plan. The information is based on the securities, exchange control and other laws in effect in the respective jurisdictions as of January 2017. Such laws are often complex and change frequently. As a result, the Company strongly recommends that the Participant should not rely on the information noted in this Exhibit B as the only source of information relating to the consequences of the Participant’s participation in the Plan because the information may be out of date by the time the Participant’s Option hereunder is exercised.

 

In addition, the information contained herein is general in nature and may not apply to the Participant’s particular situation, and the Company is not in a position to assure the Participant of a particular result. Accordingly, the Participant is advised to seek appropriate professional advice as to how the relevant laws in the Participant’s jurisdiction may apply to the Participant’s situation.

 

Finally, the Participant understands that if he or she is a citizen or resident of a jurisdiction other than the one in which the Participant is currently working, transfers employment after the Grant Date, or is considered a resident of another jurisdiction for local law purposes, the information contained herein may not apply to the Participant, and the Company shall, in its discretion, determine to what extent the terms and conditions contained herein shall apply.

 

*   *   *

 

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Brazil

 

·                  References in the Award Agreement and Exhibit A thereto to the POE Agreement (and related obligations thereunder) will not apply to the Participant.

 

·                  The automatic Option exercise provision set forth in the last sentence of Section 4 of the Award Agreement and in Section 7.5 of the Plan will not apply to the Participant.

 

·                  The non-solicitation restrictions in Section 7(c) of the Award Agreement shall not apply with respect to any prospective clients of the Company who are not current clients of the Company while the Participant maintains an employment relationship with the Company.

 

·                  Section 12 of the Award Agreement shall be revised to read as follows:

 

·                  12. No Right to Employment. The Participant agrees that nothing in this Award Agreement constitutes a contract of employment with the Travelers Group. Nothing contained herein shall be deemed to give the Participant the right to be retained in the service of the Travelers Group or to interfere with the right of the Travelers Group to terminate the employment of the Participant at any time.

 

·                  Section 18 of the Award Agreement shall be revised to provide that the venue for any disputes related to the Award Agreement shall be in a court of law based in Brazil, at the city where the participant renders his/her services.

 

·                  The provisions in Exhibit A related to the Retirement Rule shall be inapplicable to the Participant. Accordingly, upon the Participant’s termination of employment for any reason other than due to death, Disability or qualifying terminations following a Change of Control as set forth in the Award Agreement (regardless of whether the Participant meets the Retirement Rule), vesting of the Option will cease and all outstanding unvested portions of the Option will be cancelled effective on the Termination Date and you will be permitted to exercise your vested options for up to 90 days after the Termination Date but no later than the original Option expiration date.

 

·                  The provisions in Exhibit A related to disability shall be inapplicable to the Participant for so long as the Participant remains employed by the Travelers Group.  Accordingly, a disabled Participant who remains employed by the Travelers Group shall be treated as a continuing employee in all respects for purposes of vesting and other rights with respect to the Option.

 

·                  References in the Award Agreement to the Participant’s “employment” with the Travelers Group (or similar terminology) shall be deemed to refer to the Participant’s “services agreement” with the Travelers Group in the case of any statutory officer or any other Participant whose compensation arrangement with the Travelers Group is pro-labore and who has not executed an employment agreement (i.e., employment bond), under Brazilian labor law.  Nothing herein shall be deemed to affect the Participant’s actual status as an employee or statutory officer from a Brazilian labor or corporate law standpoint.

 

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California

 

·                  If the Participant is employed in the State of California immediately prior to the Termination Date, then Sections 7(b) and 7(c) of the Award Agreement shall be restated to read as follows:

 

7(b)                          Non-Solicitation of Employees. The Participant acknowledges that the Travelers Group sustains its operations and the goodwill of its clients, customers, policyholders, producers, agents and brokers (its “Customers”) through its employees. The Travelers Group has made significant investment in its employees and their ability to establish and maintain relationships with each other and with the Travelers Group’s Customers in order to further its operations and cultivate goodwill. The Participant acknowledges that the loss of the Travelers Group’s employees could adversely affect its operations and jeopardize the goodwill that has been established through these employees, and that the Travelers Group therefore has a legitimate interest in preventing the solicitation of its employees.  Accordingly, the Participant hereby agrees that during the Restricted Period, the Participant will not, directly or indirectly, seek to recruit or solicit, attempt to influence or assist, participate in, or promote the solicitation of the employment of any person who was or is employed by the Travelers Group at any time during the last three months of the Participant’s employment or during the Restricted Period. The Participant shall not engage in the aforesaid conduct through a third party for the purpose of colluding to avoid the restrictions in this Section 7(b). Without limiting the generality of the restrictions under this Section 7(b), by way of example, the restrictions under this Section shall prohibit the Participant from (i) initiating communications with a Travelers Group employee in connection with a current or future employment opportunity outside of the Travelers Group, (ii) identifying Travelers Group employees to potentially be solicited, and/or (iii) otherwise assisting or participating in the solicitation of a Travelers Group employee.

 

Notwithstanding the foregoing, the Non-Solicitation Conditions do not preclude the Participant from directing a third party (including but not limited to employees of his/her subsequent employer or a search firm) to broadly solicit, recruit, and hire individuals, some of whom may be employees of the Travelers Group, provided, that the Participant does not direct such third party specifically to solicit employees of the Travelers Group generally or specific individual employees of the Travelers Group.

 

7(c)                           Non-Solicitation of Business. The Participant acknowledges that by virtue of his or her employment with the Travelers Group, he or she may have had access to Trade Secrets and/or Confidential Information (as defined in Section 7(f)) about the Travelers Group’s Customers and is, therefore, capable of significantly and adversely impacting existing relationships that the Travelers Group has with them. The Participant further acknowledges that the Travelers Group has invested in its and the Participant’s relationship with its Customers and the goodwill that has been developed with them and therefore has a legitimate interest in protecting these relationships against Participant’s use of Trade Secrets and/or Confidential Information to solicit Customers and/or otherwise interfere with these customer relationships. If, after the Termination Date, the Participant accepts a position as an employee, consultant or contractor with a “Competitor” (as defined below), then the Participant will not utilize Trade Secrets and/or Confidential Information to directly or indirectly, solicit, interfere with or attempt to influence any Customer of the Travelers Group to discontinue business with the Travelers Group and/or move existing or future business of the Travelers Group elsewhere. This restriction applies with respect to any business of any current or prospective client, customer or policyholder of the Travelers Group on which the Participant gained access to Trade Secrets and/or Confidential Information during the Participant’s employment with the Travelers Group. In addition to the foregoing restriction, the Participant agrees not to utilize Trade Secrets and/or Confidential Information in the negotiation, competition for, solicitation or execution of any individual book roll over(s) or other book of business transfer arrangements involving the transfer of business away from the Travelers Group. As used herein, “Competitor” shall include any business enterprise or organization, including, without limitation, agents, brokers and producers, that engages in, owns or controls a significant interest in any entity that engages in the sale of products and/or performance of services of the type sold or performed by the Travelers Group and/or provides advice relating to such products and services.

 

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Canada

 

·                  References in the Award Agreement and Exhibit A thereto to the POE Agreement (and related obligations thereunder) will not apply to the Participant.

 

·                  Section 12 of the Award Agreement shall be revised to read as follows:

 

12.                               No Right to Employment. The Participant agrees that nothing in this Award Agreement constitutes a contract of employment with the Travelers Group. Nothing contained herein shall be deemed to give the Participant the right to be retained in the service of the Travelers Group or to interfere with the right of the Travelers Group to terminate the employment of the Participant at any time.

 

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India

 

·                  References in the Award Agreement and Exhibit A thereto to the POE Agreement (and related obligations thereunder) will not apply to the Participant.

 

·                  To the extent that the Company elects to enforce the forfeiture and repayment provisions under Section 8(b) of the Award Agreement by re-acquiring shares of Common Stock held by the Participant, the Company will pay nominal consideration, as determined at the discretion of the Company, for such shares and/or obtain approval from the Reserve Bank of India, to the extent required under applicable law.

 

·                  Section 18 of the Award Agreement shall be revised to read as follows:

 

18                                  Governing Law and Forum for Disputes. The Award Agreement shall be legally binding and shall be executed and construed and its provisions enforced and administered in accordance with the laws of the State of Minnesota. Any dispute, claim or controversy arising under, out of, or in connection with or in relation to this Award Agreement or the Plan, or any breach, termination or validity thereof, shall be finally determined and adjudicated through arbitration by a sole arbitrator located in Mumbai, India. The arbitration proceedings shall be conducted in accordance with the SIAC Rules in effect at the time of arbitration, and judgment upon the award may be entered in any court having jurisdiction thereof or having jurisdiction over the parties or their assets. It is mutually agreed that the written decision of the arbitrator shall be valid, binding, final and non-appealable. To the extent permitted by law, the arbitrator’s fees and expenses will be borne equally by each party. In the event that an action is brought to enforce the provisions of this Award Agreement or the Plan pursuant to this Section 18, each party shall pay its own attorneys’ fees and expenses regardless of whether there is a prevailing party in the opinion of the arbitrator deciding such action or the court in which any such arbitration award is entered. Without prejudice to the rights of the Company under this Section, if the Participant breaches, or proposes to breach the provisions of this Award Agreement or Plan, the Company and the Travelers Group shall be entitled, in addition to all other remedies such party may have, to a temporary, preliminary or permanent injunction or other appropriate equitable relief to restrain any such breach without showing or proving any actual damage to the non-breaching party from any court having competent jurisdiction over either party.

 

17

 

Republic of Ireland

 

·                  References in the Award Agreement and Exhibit A thereto to the POE Agreement (and related obligations thereunder) will not apply to the Participant.

 

·                  Section 12 of the Award Agreement shall be revised to read as follows:

 

12.                               No Right to Employment. The Participant agrees that nothing in this Award Agreement constitutes a contract of employment with the Travelers Group for a definite period of time. The Travelers Group retains the right to decrease the Participant’s compensation and/or benefits, transfer or demote the Participant or otherwise change the terms or conditions of the Participant’s employment with the Travelers Group, subject to applicable Irish law and the terms of the Participant’s employment contract.

 

·                  Section 18 of the Award Agreement shall be revised to provide that the venue for any disputes related to the Award Agreement shall be in a court of law based in the Republic of Ireland. In all other respects, the regular provisions set forth in Section 18 of the Award Agreement (including with respect to Minnesota governing law) shall apply.

 

·                  Further to the provisions as set out in Section 19 of the Award Agreement, the Travelers Group agrees that it will comply with the provisions of the Data Protection Act 1988 together with the Data Protection (Amendment) Act 2003 (collectively, the “Irish DPA Act”). The Participant consents to the Company, the Travelers Group and any other third parties as described in Section 19 processing and transferring their personal data (as defined in the Irish DPA Act), outside of the European Economic Area even where the country or territory in question does not maintain adequate data protection standards.

 

·                  The provisions in Exhibit A related to the Retirement Rule shall be inapplicable to the Participant. Accordingly, upon the Participant’s termination of employment for any reason other than due to death, Disability or qualifying terminations following a Change of Control as set forth in the Award Agreement (regardless of whether the Participant meets the Retirement Rule), vesting of the Option will cease and all outstanding unvested portions of the Option will be cancelled effective on the Termination Date and you will be permitted to exercise your vested options for up to 90 days after the Termination Date but no later than the original Option expiration date.

 

·                  The provisions in Exhibit A related to disability shall be inapplicable to the Participant for so long as the Participant remains employed by the Travelers Group.  Accordingly, a disabled Participant who remains employed by the Travelers Group shall be treated as a continuing employee in all respects for purposes of vesting and other rights with respect to the Option.

 

18

 

United Kingdom

 

·                  References in the Award Agreement and Exhibit A thereto to the POE Agreement (and related obligations) will not apply to the Participant.

 

·                  The Restricted Period, as defined in Section 7(a) of the Award Agreement, will include any period during which the Participant is placed on “garden leave.”

 

·                  The restrictions under Section 7(b) of the Award Agreement related to non-solicitation of employees shall only apply with respect to employees with whom the Participant had material dealings during the 12 months preceding the date of the Participant’s termination of employment with the Travelers Group, and such restrictions shall not apply with respect to any secretarial or administrative assistant employees of the Travelers Group.

 

·                  The “Enhanced Restricted Period” defined under Section 7(c) of the Award Agreement shall be limited to 12 months following the Termination Date (i.e., the same duration as the normal Restricted Period). Additionally, under Section 7(c) of the Award Agreement:

 

(i)                                     the restrictions relating to recruiting or solicitation of, interference with, attempting to influence or otherwise affecting any client, customer, policyholder or agent of the Travelers Group shall be limited to such clients, customers, policyholders or agents with which the Participant had material dealings within the 12 months preceding the Termination Date; and

 

(ii)                                  the references to “business” (aside from references to “book of business”) shall be limited to business activities with which the Participant was materially involved during the 12 months preceding the Termination Date.

 

·                  Section 12 of the Award Agreement shall be replaced with the following:

 

12.                               No Right to Employment. The Participant agrees that nothing in this Award Agreement constitutes a contract of employment or guarantees employment with any member of the Travelers Group for a fixed duration of time. Each member of the Travelers Group retains the right to decrease the Participant’s compensation and/or benefits, transfer or demote the Participant or otherwise change the terms or conditions of the Participant’s employment with the Travelers Group, subject to applicable law and the terms of the Participant’s employment contract. Upon termination of the Participant’s employment (for whatever reason) the Participant will have no rights as a result of this Award Agreement or any alleged breach of this Award Agreement or otherwise to any compensation under or in respect of any shares, share options, restricted stock units, long-term incentive plans or any other profit sharing scheme in which the Participant may participate or have received grants or allocations on or before the date on which the Participant’s employment terminates. Any rights which the Participant may have under such schemes will be exclusively governed by the rules of such schemes from time to time.

 

·                  Section 18 of the Award Agreement shall be revised to provide that the venue for any disputes related to the Award Agreement shall be the Courts of England and Wales. In all other respects, the regular provisions set forth in Section 18 of the Award Agreement (including with respect to Minnesota governing law) shall apply.

 

·                  Further to the provisions as set out in Section 19 of the Award Agreement, the Travelers Group agrees that it will comply with the provisions of the Data Protection Act 1998 (the “Act”). The Participant consents to the Company, the Travelers Group and any other third parties as described in Section 19 processing and transferring their personal data (as defined in the Act), outside of the European Economic Area even where the country or territory in question does not maintain adequate data protection standards.

 

·                  The provisions in Exhibit A related to the Retirement Rule shall be inapplicable to the Participant. Accordingly, upon the Participant’s termination of employment for any reason other than due to death, Disability or qualifying terminations following a Change of Control as set forth in the Award Agreement (regardless of whether the Participant meets the Retirement Rule), vesting of the 

 

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Option will cease and all outstanding unvested portions of the Option will be cancelled effective on the Termination Date and you will be permitted to exercise your vested options for up to 90 days after the Termination Date but no later than the original Option expiration date.

 

·                  The provisions in Exhibit A related to disability shall be inapplicable to the Participant for so long as the Participant remains employed by the Travelers Group.  Accordingly, a disabled Participant who remains employed by the Travelers Group shall be treated as a continuing employee in all respects for purposes of vesting and other rights with respect to the Option.

 

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