Document:

FORM OF EMPLOYMENT AGREEMENT

 

Exhibit 10.04

EMPLOYMENT AGREEMENT

     EMPLOYMENT AGREEMENT, dated as of March 20, 2001, by and between The
Hartford Financial Services Group, Inc., a Delaware corporation (the
“Company”), and Neal Wolin (“Executive”).

W I T N E S S E T H:

          WHEREAS, the Company desires that Executive perform substantial services
for the Company and to enter into an agreement embodying the terms of such
employment (the “Agreement”); and

          WHEREAS, Executive desires to perform such services, enter into such
employment and enter into such Agreement;

          NOW, THEREFORE, in consideration of the mutual covenants herein contained,
the Company and Executive hereby agree as follows:

1. Employment.

(a) Agreement to Employ. Upon the terms and subject to the conditions
of this Agreement, the
Company hereby agrees to employ Executive and Executive hereby agrees to
commence his employment by the Company.

(b) Term of Employment. Except as otherwise provided below, the Company
shall employ Executive for the period commencing on the date first written
above (the “Commencement Date”) and ending on the third anniversary of the
Commencement Date. At the expiration of the original term or any extended
term (each a “Renewal Date”), Executive’s employment hereunder shall be
extended automatically, upon the same terms and conditions, for successive
one-year periods, unless either party shall give written notice to the other
of its intention not to renew such employment at least fifteen months prior
to such Renewal Date. Without limiting the generality of the foregoing,
upon the occurrence of a Change of Control (as defined below), the term of
this Agreement shall be extended automatically without any action by either
party until the third anniversary of such Change of Control.
Notwithstanding the foregoing, if not previously terminated pursuant to
Sections 1(b), 5(a) or 6(a), the term of this Agreement shall terminate on
the last day of the month in which Executive attains age 65, and such a
termination upon Executive reaching age 65 shall be deemed to be a
Termination Due to Retirement for purposes of this Agreement. The period
during which Executive is employed pursuant to this Agreement, including any
extension thereof in accordance with this Section 1(b), shall be referred to
as the “Employment Period.”

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2. Position and Duties.

During the Employment Period, Executive shall serve as Executive Vice
President, General Counsel and as a member of the Office of the Chairman of the
Company, and/or in such other position or positions with the Company or its
affiliates commensurate with his position and experience as the Board of
Directors of the Company (the “Board”) shall from time to time specify. During
the Employment Period, Executive shall have the duties, responsibilities and
obligations customarily assigned to individuals serving in the position or
positions in which Executive serves hereunder and such other duties,
responsibilities and obligations as the Board or the Chairman shall from time
to time specify. Executive shall devote his full time to the services required
of him hereunder, except for vacation time and reasonable periods of absence
due to sickness, personal injury or other disability, and shall use his best
efforts, judgment, skill and energy to perform such services in a manner
consonant with the duties of his position and to improve and advance the
business and interests of the Company and its affiliates. During the
Employment Period, Executive shall comply with the Code of Conduct of the
Company. Unless and to the extent inconsistent with the terms of any published
Company policy or code of conduct as in effect on the date hereof and as
hereafter amended, nothing contained herein shall preclude Executive from (a)
serving on the board of directors of any business corporation with the consent
of the Board, (b) serving on the board of, or working for, any charitable or
community organization, or (c) pursuing his personal financial and legal
affairs, so long as the foregoing activities, individually or collectively, do
not interfere with the performance of Executive’s duties hereunder or violate
any of the provisions of Section 9 hereof.

3. Compensation.

(a) Base Salary. During the Employment Period, the Company shall pay
Executive a base salary at the annual rate as in effect on the date hereof.
The annual base salary payable under this paragraph shall be reduced,
however, to the extent that Executive elects to defer such salary under the
terms of any deferred compensation or savings plan or arrangement maintained
or established by the Company or its affiliates. The Board or the
appropriate committee of the Board may in its discretion periodically review
Executive’s base salary in light of competitive practices, the base salaries
paid to other executive officers of the Company and the performance of
Executive and the Company and its applicable affiliates, and may, in its
discretion, increase such base salary by an amount it determines to be
appropriate. Any such increase shall not reduce or limit any other
obligation of the Company hereunder. Executive’s base salary (as set forth
above or as may be increased from time to time) shall not be reduced
following any Change of Control, but may be reduced prior to a Change of
Control solely pursuant to a cost-saving plan or structural realignment of
total compensation elements that includes all senior executives and only to
the extent that such reduction is proportionate to the reductions applicable
to other senior executives. Executive’s annual base salary payable
hereunder, as it may be increased or reduced from time to time as provided
herein and without reduction for any amounts deferred as described above,
shall be referred to herein as “Base Salary.” The Company shall pay
Executive the portion of his Base Salary not deferred not less frequently
than in equal monthly installments.

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(b) Annual Bonus. For each calendar year ending during the Employment
Period, Executive shall have the opportunity to earn and receive an annual
bonus, based on the achievement of target levels of performance, equal to
the percentage of his Base Salary used to calculate such annual bonus as of
the date hereof. Executive’s annual bonus opportunity may be increased
above such percentage from time to time by the Board or the appropriate
committee thereof. Executive’s annual bonus opportunity shall not be reduced
following any Change of Control, but may be reduced prior to a Change of
Control solely pursuant to a cost-saving plan or structural realignment of
total compensation elements that includes all senior executives and only to
the extent that such reduction is proportionate to the reductions applicable
to other senior executives. Executive’s annual bonus opportunity, as it may
be increased or reduced from time to time as provided herein, shall be
referred to herein as “Target Bonus.” The actual bonus, if any, payable for
any such year shall be determined in accordance with the terms of the
Company’s Annual Executive Bonus Program or any successor annual incentive
plan (the “Annual Plan”) based upon the performance of the Company and/or
its applicable affiliates and/or Executive against target objectives
established under such Annual Plan. Subject to Executive’s election to
defer all or a portion of any annual bonus payable hereunder pursuant to the
terms of any deferred compensation or savings plan or arrangement maintained
or established by the Company or its affiliates, any annual bonus payable
under this Section 3(b) shall be paid to Executive in accordance with the
terms of the Annual Plan.

(c) Long-term Incentive Compensation. During the Employment Period,
Executive shall participate in all of the Company’s existing and future
long-term incentive compensation programs for key executives at a level
commensurate with his position with the Company and consistent with the
Company’s then current policies and practices, as determined in good faith
by the Board or the appropriate committee of the Board.

4. Benefits, Perquisites and Expenses.

(a) Benefits. During the Employment Period, Executive (and, to the extent
applicable, his dependents) shall be eligible to participate in or be
covered under (i) each welfare benefit plan or program maintained or as
hereafter amended or established by the Company or its applicable
affiliates, including, without limitation, each group life, hospitalization,
medical, dental, health, accident or disability insurance or similar plan or
program of thereof that is available to Tier 1 executives, and (ii) each
applicable pension, retirement, savings, deferred compensation, stock
purchase or other similar plan or program maintained or as hereafter amended
or established by the Company or its applicable affiliates, in each case to
the extent that Executive is eligible to participate in any such plan or
program under the generally applicable provisions thereof. Nothing in this
Section 4(a) shall limit the Company’s right to amend or terminate any such
plan or program in accordance with the procedures set forth therein or as
permitted by applicable law.

(b) Perquisites. For each calendar year during the Employment Period,
Executive shall be entitled to at least the number of paid vacation days per
year that a Tier 1 Executive is entitled to as of the date hereof, and shall
also be entitled to receive such other perquisites as are generally provided
to similarly situated Tier 1 executives as of the date hereof or are
hereafter provided to other similarly

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situated Tier 1 senior executives of the Company in accordance with the then
current policies and practices of the Company.

(c) Business Expenses. During the Employment Period, the Company shall pay
or reimburse Executive for all reasonable business expenses incurred or paid
by Executive in the performance of Executive’s duties hereunder, upon
presentation of expense statements or vouchers and such other information as
the Company may require and in accordance with the generally applicable
policies and procedures of the Company.

(d) Office and Support Staff. During the Employment Period, Executive
shall be entitled to an office with furnishings and other material
appointments, and to secretarial and other assistance, at a Tier 1 level and
that is at least commensurate to similarly situated executives as of the
date hereof or is hereafter provided to other similarly situated senior
executives of the Company.

(e) Indemnification. The Company shall indemnify Executive and hold
Executive harmless from and against any claim, loss or cause of action,
regardless whether asserted during or after the Employment Period, arising
from or out of Executive’s performance as an officer, director or employee of
the Company or any of its affiliates or in any other capacity, including any
fiduciary capacity in which Executive serves at the request of the Company,
to the maximum extent permitted by applicable law and under the Certificate
of Incorporation and By-Laws of the Company, as may be amended from time to
time (the “Governing Documents”), provided that in no event shall the
protection afforded to Executive be less than that afforded under the
Governing Documents as in effect on the Commencement Date.

5. Termination of Employment.

The provisions of this Section 5 shall apply prior to the occurrence of a
Change of Control and, if Executive is still in the Company’s employ, shall
again become applicable upon the third anniversary of such Change of Control.

(a) Early Termination of the Employment Period. Notwithstanding
Section 1(b) hereof, the Employment Period shall end upon the earliest
to occur of (i) a Termination For Cause, (ii) a Termination Without
Cause, (iii) a Voluntary Termination, (iv) a Termination Due to
Retirement, (v) a Termination Due to Disability, or (vi) a Termination
Due to Death.

(b) Notice of Termination. Communication of termination under this
Section 5 shall be made to the other party by Notice of Termination in
the case of (i) a Termination For Cause, (ii) a Termination Without
Cause, or (iii) a Voluntary Termination.

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(c) Benefits Payable Upon Termination; Rules for Determining Reason
for Termination.

(i) Benefits Payable Upon Termination. Following the end of the
Employment Period pursuant to Section 5(a), Executive (or, in the
event of his death, his surviving spouse, if any, or if none, his
estate) shall be paid the type or types of compensation
determined to be payable in accordance with the following table,
such payment to be made in the form specified in such table and
at the time established pursuant to Section 7 hereof.
Capitalized terms used in such table shall have the meanings set
forth in Section 5(d) hereof.

(ii) Rules for Determining Reason for Termination.

(A) If a Voluntary Termination occurs on a date that
Executive is eligible for Retirement as defined in The
Hartford Investment and Savings Plan, as may be amended
from time to time, or any successor plan thereof (the
“Savings Plan”), such Voluntary Termination shall instead
be treated as a Termination Due to Retirement solely for
purposes of this Section 5.

(B) No Termination Without Cause shall be treated as a
Termination Due to Retirement or a Termination Due to
Disability for purposes of any Pro Rata Target Bonus,
Severance Payment, Equity Awards or Vested Benefits
Enhancement under this Section 5, notwithstanding the fact
that, either on, before or after the date of termination of
the Employment Period with respect thereto, (I) Executive
was eligible for Retirement as defined in the Savings Plan,
(II) Executive requested to be treated as a retiree for
purposes of the Savings Plan or any other plan or program
of the Company or its affiliates, or (III) Executive or the
Company could have terminated Executive’s employment in a
Termination Due to Disability hereunder.

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BENEFITS PAYABLE : NON-CHANGE OF CONTROL

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Welfare
	 	 	Accrued	 	Pro Rata Target	 	Severance	 	 	 	 	 	Vested Benefits	 	Benefits
	BENEFIT:
	 	Salary
	 	Bonus
	 	Payment
	 	Equity Awards
	 	Vested Benefits
	 	Enhancement
	 	Continuation

	FORM OF	 	 	 	 	 	 	 	Determined Under	 	Determined Under	 	 	 	Determined Under
	PAYMENT:
	 	Lump Sum
	 	Lump Sum
	 	Lump Sum
	 	the Applicable Plan
	 	the Applicable Plan
	 	Lump Sum
	 	the Applicable Plan

	Termination For

Cause

	 	Payable
	 	Not Payable
	 	Not Payable
	 	Not Payable

	 	Determined Under

the Applicable Plan
	 	Not Payable
	 	Not

Available
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Termination Without

Cause

	 	Payable
	 	Payable
	 	Payable
	 	Options /Restricted

Stock:
 Payable

Other Equity

Awards: Determined

Under the

Applicable Plan
	 	Determined Under

the Applicable Plan
	 	Payable
	 	Available
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Voluntary

Termination

	 	Payable
	 	Determined Under

the Applicable Plan
	 	Not

Payable
	 	Determined Under

the Applicable Plan
	 	Determined Under

the Applicable Plan
	 	Not Payable
	 	Not Available
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Termination Due to
Retirement

	 	Payable
	 	Determined Under

the Applicable Plan
	 	Not Payable
	 	Determined Under

the Applicable Plan
	 	Determined Under

the Applicable Plan
	 	Not Payable
	 	Available
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Termination Due to
Disability

	 	Payable
	 	Payable
	 	Not Payable
	 	Determined Under

the Applicable Plan
	 	Determined Under

the Applicable Plan
	 	Not Payable
	 	Available
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Termination Due to
Death

	 	Payable
	 	Payable
	 	Not Payable
	 	Determined Under

the Applicable Plan
	 	Determined Under

the Applicable Plan
	 	Not Payable
	 	Not Available

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(d) Definitions.

“Accrued Salary” means any Base Salary earned, but unpaid, for
services rendered to the Company on or prior to the date on which the
Employment Period ends pursuant to Section 5(a) (other than Base
Salary deferred pursuant to Executive’s election, as contemplated by
Section 3(a) hereof), plus any vacation pay accrued by Executive as
of such date.

“Available” means that the particular benefit shall be made available
to Executive to the extent specifically provided herein or required
by applicable law.

“Determined Under the Applicable Plan” means that the determination
of whether a particular benefit shall or shall not be paid to
Executive, and, where specifically required by this Agreement, the
timing or form of any benefit payment, shall be made solely by
application of the terms of the plan or program providing such
benefit, except to the extent that the terms of such plan or program
are expressly superseded or modified by this Agreement.

“Equity Awards” means the outstanding stock option, restricted
stock, performance share and other equity or long-term incentive
compensation awards, if any, held by Executive as of the date of his
termination.

“ERPs” means any excess cash balance retirement plans maintained or
as hereafter amended or established by the Company or its applicable
affiliates.

“ESPs” means any excess investment and savings plans maintained or as
hereafter amended or established by the Company or its applicable
affiliates.

“Lump Sum” means a single lump sum cash payment.

“Not Available” means that the particular benefit shall be not be
made available to Executive, except to the extent required by
applicable law.

“Notice of Termination” means (i) in the case of a Termination For
Cause, a written notice given by the Company to Executive within 30
calendar days of the Company’s having actual knowledge of the events
giving rise to such Termination For Cause, (ii) in the case of a
Termination Without Cause, a written notice given by the Company to
Executive at least 30 calendar days before the effective date of such
Termination Without Cause, and (iii) in the
case of a Voluntary Termination, a written notice given by Executive
to the Company indicating the effective date of Executive’s
termination of the Employment Period in such Voluntary Termination,
such effective date to be no earlier than 30 days following the date
such notice is received by the Company from Executive.

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“Not Payable” means (i) with respect to benefits other than Equity
Awards, such benefits shall not be paid or otherwise provided to
Executive, and (ii) with respect to Equity Awards, such Equity
Awards, to the extent unvested, unexercisable, or subject to
restrictions that have not yet lapsed, shall be forfeited and/or
canceled as of the date of termination of the Employment Period,
unless otherwise determined by the Board or the appropriate committee
of the Board in its discretion.

“Payable” means (i) with respect to benefits other than those
described in clause (ii) of this paragraph, such benefits shall be
paid to Executive in the amount, at the time, and in the form
specified herein, and (ii) with respect to benefits described in this
clause (ii), the following shall apply solely in the event of a
Termination Without Cause, notwithstanding anything in the applicable
plan or program to the contrary: (A) with respect to any outstanding
stock options not yet expired as of the date of termination of the
Employment Period, Executive shall be treated as though he remained
in the employ of the Company for the two year period following such
date, and except to the extent that any such options first expire
during such period under the applicable plan or program, (I) any such
options that would have become vested over such two year period
solely by reason of Executive remaining in the employ of the Company
during such period shall become immediately vested and
nonforfeitable, (II) with respect to any options that by their terms
would vest if the stock of the Company or an affiliate were to reach
a specified market price, such options shall become vested and
nonforfeitable if and when such stock reaches such price during such
two year period, and (III) Executive shall have an additional two
years to exercise any vested options (beyond the time to exercise
such options permitted under the applicable plan or program), and (B)
with respect to any restricted stock subject to restrictions that
have not yet lapsed as of the date of termination of the Employment
Period, such restrictions shall be deemed to have lapsed and such
restricted stock shall become immediately vested and nonforfeitable
as of such date.

“Pro-Rata Target Bonus” means an amount equal to the product of: (i)
an amount equal to the Target Bonus Executive would have been
entitled to receive under Section 3(b) for the calendar year in which
the Employment Period terminates, and (ii) a fraction (the “Service
Fraction”), the numerator of which is equal to the number of rounded
months in such calendar year which have elapsed as of the date of
such termination, and the denominator of which is 12; provided that,
if the Employment Period terminates in the last quarter of any
calendar year, the Pro-Rata Target Bonus shall be the amount
determined under the above formula or, if greater, the product of:
(A) the bonus that would have been paid to Executive based on actual
performance for such calendar year, and (B) the Service Fraction.

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“Severance Payment” means an amount equal to two times the sum of:
(i) Executive’s Base Salary, and (ii) Executive’s Target Bonus amount
under Section 3(b) hereof for the calendar year in which the
Employment Period terminates.

“Termination Due to Death” means a termination of Executive’s
employment due to the death of Executive.

“Termination Due to Disability” means (i) a termination of
Executive’s employment by the Company as a result of a determination
by the Board or the appropriate committee thereof that Executive has
been incapable of substantially fulfilling the positions, duties,
responsibilities and obligations set forth in this Agreement on
account of physical, mental or emotional incapacity resulting from
injury, sickness or disease for a period of (A) at least four
consecutive months, or (B) more than six months in any twelve month
period, or (ii) Executive’s termination of employment on account of
Disability as defined in The Hartford Investment and Savings Plan, as
may be amended from time to time.

“Termination Due to Retirement” means Executive’s termination of
employment on account of Executive’s Retirement as defined in The
Hartford Investment and Savings Plan, as may be amended from time to
time.

“Termination For Cause” means a termination of Executive’s employment
by the Company for any of the following reasons: (i) Executive is
convicted of or enters a plea of guilty or nolo contendere to a
felony, a crime of moral turpitude, dishonesty, breach of trust or
unethical business conduct, or any crime involving the business of
the Company or its affiliates; (ii) in the performance of his duties
hereunder or otherwise to the detriment of the Company or its
affiliates, Executive engages in (A) willful misconduct, (B) willful
or gross neglect, (C) fraud, (D) misappropriation, (E) embezzlement,
or (F) theft; (iii) Executive willfully fails to adhere to the
policies and practices of the Company or devote substantially all of
his business time and effort to the affairs thereof, or disobeys the
directions of the Board to do either of the foregoing; (iv) Executive
breaches this Agreement in any material respect; (v) Executive is
adjudicated in any civil suit to have committed, or acknowledges in
writing or in any agreement or stipulation his commission, of any
theft, embezzlement, fraud or other intentional act of dishonesty
involving any other person; or (vi) Executive willfully violates the
Code of Conduct of the Company. Executive shall be permitted to
respond and defend himself before the Board within 30 days after
delivery to Executive of written notification of any proposed
Termination For Cause that specifies in detail the reasons for such
termination. If the majority of the members of the Board (excluding
Executive) do not confirm that the Company had grounds for a
Termination For Cause within 30 days after Executive has had his
hearing before the Board, Executive shall have the option of treating
his employment

9

 

as not having terminated or as having been terminated in a
Termination Without Cause.

“Termination Without Cause” means any involuntary termination of
Executive’s employment by the Company other than a Termination For
Cause, a Termination Due to Disability or a Termination Due to Death.

“Vested Benefits” means amounts that are vested or that Executive is
otherwise entitled to receive, without the performance by Executive
of further services or the resolution of a contingency, under the
terms of or in accordance with any investment and savings plan or
cash balance retirement plan (including any plan providing retiree
medical benefits) of the Company or its affiliates, and any ERPs or
ESPs related thereto, and any deferred compensation or employee stock
purchase plan or similar plan or program of the Company or its
affiliates.

“Vested Benefits Enhancement” means (i) a cash amount equal to the
present value, calculated using a discount rate equal to the then
prevailing applicable Federal rate as determined under Section
1274(d) of the Internal Revenue Code of 1986, as amended (the
“Code”), of the additional retirement benefits that would have been
payable or available to Executive under any ERPs, based on (A) the
age and service Executive would have attained or completed had
Executive continued in the Company’s employ until the second
anniversary of the date of termination of the Employment Period, and
(B) where compensation is a relevant factor, his pensionable
compensation as of such date, such compensation to include, on the
same terms as apply to other executives, any Severance Payment made
to Executive, and (ii) solely for purposes vesting in any benefits
under any ESPs, Executive shall be treated as having continued in the
Company’s employ until the second anniversary of the date of
termination of the Employment Period.

“Voluntary Termination” means any voluntary termination of
Executive’s Employment by Executive pursuant to this Section 5, other
than a Termination Due to Retirement or a Termination Due to
Disability by Executive.

“Welfare Benefits Continuation” means that until the second
anniversary of the date of termination of the Employment Period,
Executive and, if applicable, his dependents shall be entitled to
continue participation in the life and health insurance benefit plans
of the Company or its affiliates in which Executive and/or such
dependents were participating as of the date of termination of the
Employment Period, and such other welfare benefit plans thereof in
which the Company is required by law to permit the participation of
Executive and/or his dependents, (collectively, the “Welfare Benefit
Plans”). Such participation shall be on the same terms and
conditions (including the requirement that Executive pay any premiums
generally paid by an employee)

10

 

as would apply if Executive were still in the employ of the Company;
provided that the continued participation of Executive and/or his
dependents in such Welfare Benefit Plans shall cease on such earlier
date as Executive may become eligible for comparable welfare benefits
provided by a subsequent employer. To the extent that Welfare
Benefits Continuation cannot be provided under the terms of the
applicable plan, policy or program, the Company shall provide a
comparable benefit under another plan or from the Company’s general
assets.

6. Termination Following a Change of Control or Potential Change of Control.

This Section 6 shall apply (instead of Section 5) during the period commencing
upon a Change of Control and continuing until the third anniversary thereof;
provided that, in the event that Executive’s employment is terminated by the
Company in a Termination Without Cause after the occurrence of a Potential
Change of Control and a Change of Control occurs within one year following the
date of such termination, then solely for purposes of this Agreement, Executive
shall be deemed to have remained in the Company’s employ until the occurrence
of the Change of Control and thereafter to have then been terminated by the
Company in a Termination Without Cause. As a result, Executive shall be
entitled to receive the excess of (i) the benefits payable in the event of a
Termination Without Cause under this Section 6, over (ii) the amount of any
benefits payable to Executive under Section 5.

(a) Early Termination of the Employment Period. Notwithstanding Section
1(b) hereof, the Employment Period shall end upon the earliest to occur of
(i) a Termination For Cause, (ii) a Termination Without Cause, (iii) a
Voluntary Termination Within 180 Days, (iv) a Voluntary Termination After
180 Days, (v) a Termination For Good Reason, (vi) a Termination Due to
Retirement, (vii) a Termination Due to Disability, or (viii) a Termination
Due to Death.

(b) Notice of Termination. Communication of termination under this Section
6 shall be made to the other party by Notice of Termination in the case of
(i) a Termination For Cause, (ii) a Termination Without Cause, (iii) a
Voluntary Termination Within 180 Days, (iv) a Voluntary Termination After
180 Days, or (v) a Termination For Good Reason.

(c) Benefits Payable Upon Termination; Rules for Determining Reason for
Termination.

(i) Benefits Payable Upon Termination.

(A) Following the end of the Employment Period,
Executive (or, in the event of his
death, his surviving spouse, if any, or if none, his estate)
shall be paid the type or types of compensation determined to be
payable in accordance with the following table, such payment to
be made in the form specified in such table and at the time
established pursuant to Section 7 hereof. Capitalized terms used
in such table (and otherwise in this Section 6) that are defined
in Section 5, and not specifically defined

11

 

in Section 6(d) hereof, shall have the meanings ascribed thereto
under Section 5. Where such a capitalized term is defined solely
in Section 6(d), or in both Section 5 and Section 6(d), such term
shall have the meaning ascribed to it in Section 6(d).

(B) The Company’s obligation to make the payments provided for
in this Section 6 and otherwise to perform its obligations under
this Section 6 shall not be affected by any set-off,
counterclaim, recoupment, defense or other claim, right or action
which the Company may have against Executive or others. In no
event shall Executive be obligated to seek other employment or
take any other action by way of mitigation of the amounts payable
to Executive under any of the provisions of this Section 6 and
such amounts shall not be reduced whether or not Executive
obtains other employment.

(ii) Rules for Determining Reason for Termination.

(A) No Termination Without Cause, Voluntary Termination Within
180
Days or Termination For Good Reason shall be treated as a
Termination
Due to Retirement or a Termination Due to Disability for purposes
of any
Pro Rata Target Bonus, Severance Payment, Equity Awards or Vested
Benefits Enhancement under this Section 6, notwithstanding the
fact that,
either on, before or after the Date of Termination with respect
thereto,
(I) Executive was eligible for Retirement as defined in the
Savings Plan,
(II) Executive requested to be treated as a retiree for purposes
of the Savings
Plan or any other plan or program of the Company or its
affiliates, or
(III) Executive or the Company could have terminated Executive’s
employment
in a Termination Due to Disability hereunder.

(B) No Termination Due to Retirement shall be treated as a
Voluntary
Termination After 180 Days for purposes of this Section 6,
notwithstanding the
fact that the Date of Termination for such Termination Due to
Retirement may
occur within 180 days following a Change of Control.

(C) Notwithstanding any provision in this Agreement to the
contrary, in the event of a Change of Control as described in
clause (iii) or clause (iv) of the definition of the term Change
of Control in Section 6(d) of this Agreement, if the employment
of Executive involuntarily terminates on or after the date of a
shareholder approval described in either of such clauses but
before the date of a consummation described in either of such
clauses, the date of termination of Executive’s employment shall
be deemed for purposes of this Agreement to be the day following
the date of the applicable consummation.

12

 

BENEFITS PAYABLE: CHANGE OF CONTROL

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	Accrued	 	Pro Rata Target	 	Severance	 	 	 	 	 	Vested Benefits	 	Welfare
	BENEFIT
	 	Salary
	 	Bonus
	 	Payment
	 	Equity Awards
	 	Vested Benefits
	 	Enhancement
	 	Benefits Continuation

	FORM OF	 	 	 	 	 	 	 	Determined Under	 	Determined Under	 	 	 	Determined Under the
	PAYMENT
	 	Lump Sum
	 	Lump Sum
	 	Lump Sum
	 	the Applicable Plan
	 	the Applicable Plan
	 	Lump Sum
	 	Applicable Plan

	Termination For

Cause

	 	Payable
	 	Not Payable
	 	Not Payable
	 	Determined Under

the Applicable Plan
	 	Determined Under

the Applicable Plan
	 	Not Payable
	 	Not Available
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Termination Without

Cause

	 	Payable
	 	Payable
	 	Payable
	 	Determined Under

the Applicable Plan
	 	Determined Under

the Applicable Plan
	 	Payable
	 	Available
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Voluntary

Termination Within

180 Days

	 	Payable
	 	Payable
	 	Payable
	 	Determined Under

the Applicable Plan
	 	Determined Under

the Applicable Plan
	 	Payable
	 	Available
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Voluntary

Termination

After

180 Days

	 	Payable
	 	Not Payable
	 	Not Payable
	 	Determined Under

the Applicable Plan
	 	Determined Under

the Applicable Plan
	 	Not Payable
	 	Not Available
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Termination For

Good Reason

	 	Payable
	 	Payable
	 	Payable
	 	Determined Under

the Applicable Plan
	 	Determined Under

the Applicable Plan
	 	Payable
	 	Available
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Termination Due to
Retirement

	 	Payable
	 	Determined Under

the Applicable Plan
	 	Not Payable
	 	Determined Under

the Applicable Plan
	 	Determined Under

the Applicable Plan
	 	Not Payable
	 	Available
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Termination Due to
Disability

	 	Payable
	 	Payable
	 	Not Payable
	 	Determined Under

the Applicable Plan
	 	Determined Under

the Applicable Plan
	 	Not Payable
	 	Available
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Termination Due to
Death

	 	Payable
	 	Payable
	 	Not Payable
	 	Determined Under

the Applicable Plan
	 	Determined Under

the Applicable

Plan
	 	Not Payable
	 	Not Available

13

 

(d) Definitions.

“Beneficial Owner” means any Person who, directly or indirectly, has the
right to vote or dispose of or has “beneficial ownership” (within the
meaning of Rule 13d-3 under the Securities and Exchange Act of 1934, as
amended (the “Act”)) of any securities of a company, including any such
right pursuant to any agreement, arrangement or understanding (whether or
not in writing), provided that: (i) a Person shall not be deemed the
Beneficial Owner of any security as a result of an agreement, arrangement or
understanding to vote such security (A) arising solely from a revocable
proxy or consent given in response to a public proxy or consent solicitation
made pursuant to, and in accordance with, the Exchange Act and the
applicable rules and regulations thereunder, or (B) made in connection with,
or to otherwise participate in, a proxy or consent solicitation made, or to
be made, pursuant to, and in accordance with, the applicable provisions of
the Exchange Act and the applicable rules and regulations thereunder, in
either case described in clause (A) or (B) above, whether or not such
agreement, arrangement or understanding is also then reportable by such
Person on Schedule 13D under the Exchange Act (or any comparable or
successor report); and (ii) a Person engaged in business as an underwriter
of securities shall not be deemed to be the Beneficial Owner of any security
acquired through such Person’s participation in good faith in a firm
commitment underwriting until the expiration of forty days after the date of
such acquisition.

“Change of Control” means:

(i) a report on Schedule 13D shall be filed with the Securities and
Exchange Commission pursuant to Section 13(d) of the Act disclosing
that any Person, other than the Company or a subsidiary of the
Company or any employee benefit plan sponsored by the Company or a
subsidiary of the Company is the Beneficial Owner of twenty percent
or more of the outstanding stock of the Company entitled to vote in
the election of directors of the Company;

(ii) any Person, other than the Company or a subsidiary of the
Company or any employee benefit plan sponsored by the Company or a
subsidiary of the Company shall purchase shares pursuant to a tender
offer or exchange offer to acquire any stock of the Company (or
securities convertible into stock) entitled to vote in the election
of directors of the Company for cash, securities or any other
consideration, provided that after consummation of the offer, the
Person in question is the Beneficial Owner of fifteen percent or more
of the outstanding stock of the Company entitled to vote in the
election of directors of the Company (calculated as provided in
paragraph (d) of Rule 13d-3 under the Act in the case of rights to
acquire stock);

(iii)any merger, consolidation, recapitalization or reorganization of
the Company approved by the stockholders of the Company shall be
consummated, other than any such transaction immediately following
which the persons who were the Beneficial Owners of the outstanding
securities of

14

 

the Company entitled to vote in the election of directors of the
Company immediately prior to such transaction are the Beneficial
Owners of at least 55% of the total voting power represented by the
securities of the entity surviving such transaction entitled to vote
in the election of directors of such entity (or the ultimate parent
of such entity) in substantially the same relative proportions as
their ownership of the securities of the Company entitled to vote in
the election of directors of the Company immediately prior to such
transaction; provided that, such continuity of ownership (and
preservation of relative voting power) shall be deemed to be
satisfied if the failure to meet such threshold (or to preserve such
relative voting power) is due solely to the acquisition of voting
securities by an employee benefit plan of the Company, such surviving
entity or any subsidiary of such surviving entity:

(iv) any sale, lease, exchange or other transfer (in one transaction
or a series of related transactions) of all or substantially all the
assets of the Company approved by the stockholders of the Company
shall be consummated; or

(v) within any 24 month period, the persons who were directors of the
Company immediately before the beginning of such period (the
“Incumbent Directors”) shall cease (for any reason other than death)
to constitute at least a majority of the Board or the board of
directors of any successor to the Company, provided that any director
who was not a director at the beginning of such period shall be
deemed to be an Incumbent Director if such director (A) was elected
to the Board by, or on the recommendation of or with the approval of,
at least two-thirds of the directors who then qualified as Incumbent
Directors either actually or by prior operation of this clause (v),
and (B) was not designated by a person who has entered into an
agreement with the Company to effect a transaction described in
clause (iii) or (iv) of this definition of the term Change of Control
in Section 6(d) of this Agreement.

“Date of Termination” means (i) in the case of a termination of the
Employment Period for which a Notice of Termination is required, the date of
receipt of such Notice of Termination or, if later, the date specified
therein, as the case may be, or (ii) in all other cases, the actual date on
which Executive’s employment terminates during the Employment Period.

“Not Payable” means that a particular benefit shall not be paid or otherwise
provided to Executive.

“Notice of Termination” means (i) in the case of a Termination For Cause, a
written notice given by the Company to Executive, within 30 calendar days of
the Company’s having actual knowledge of the events giving rise to such
termination, (ii) in the case of a Termination Without Cause, a written
notice given by the Company to Executive at least 30 calendar days before
the effective date of such Termination Without Cause, (iii) in the case of a
Voluntary Termination Within 180 Days or a Voluntary Termination After 180
Days, a written notice given by Executive to the Company at

15

 

least 30 calendar days before the effective date of such termination, and
(iv) in the case of a Termination For Good Reason, a written notice given by
Executive to the Company within 180 days of Executive’s having actual
knowledge of the events giving rise to such Termination For Good Reason, and
which (A) indicates the specific termination provision in this Agreement
relied upon, (B) sets forth in reasonable detail the facts and circumstances
claimed to provide a basis for termination of the Executive’s employment
under the provision so indicated, and (C) if the termination date is other
than the date of receipt of such notice, specifies the termination date of
this Agreement (which date shall be not more than 15 days after the giving
of such notice). The failure by Executive to set forth in such Notice of
Termination any fact or circumstance that contributes to a showing of Good
Reason shall not waive any right of Executive hereunder or preclude
Executive from asserting such fact or circumstance in enforcing his rights
hereunder.

“Payable” means that a particular benefit shall be paid to Executive in the
amount, at the time, and in the form specified herein.

“Person” has the meaning ascribed to such term in Section 3(a)(9) of the
Act, as supplemented by Section 13(d)(3) of the Act; provided, however, that
Person shall not include (i) the Company, any subsidiary of the Company or
any other Person controlled by the Company, (ii) any trustee or other
fiduciary holding securities under any employee benefit plan of the Company
or of any subsidiary of the Company, or (iii) a corporation owned, directly
or indirectly, by the stockholders of the Company in substantially the same
proportions as their ownership of securities of the Company.

“Potential Change of Control” means:

(i) a Person shall commence a tender offer, which if successfully
consummated, would result in such Person being the beneficial owner
of at least 15% of the stock of the Company entitled to vote in the
election of directors of the Company;

(ii) the Company shall enter into an agreement the consummation of
which shall constitute a Change of Control of the Company;

(iii) solicitation of proxies for the election of directors of the
Company by anyone other than the Company, which,
if such directors were elected, would result in the occurrence of a
Change of Control described in Section 6(d) of this Agreement; or

(iv) any other event shall occur which is deemed to be a Potential
Change of Control by the Board or the appropriate Committee thereof.

“Severance Payment” means a cash amount equal to three times the sum of (i)
Executive’s Base Salary at the rate in effect as of the date on which the
Employment Period terminates, and (ii) Executive’s Target Bonus for such
year.

16

 

“Termination For Cause” means the Company’s termination of Executive’s
employment due to (i) Executive’s conviction of a felony; (ii) an act or
acts of extreme dishonesty or gross misconduct on Executive’s part which
result or are intended to result in material damage to the Company’s
business or reputation; or (iii) repeated material violations by Executive
of his obligations under Section 2 of this Agreement, which violations are
demonstrably willful and deliberate on Executive’s part and which result in
material damage to the Company’s business or reputation. Executive shall be
permitted to respond and defend himself before the Board within 30 days
after delivery to Executive of written notification of any proposed
Termination for Cause which specifies in detail the reasons for such
termination. If the majority of the members of the Board (excluding
Executive) do not confirm that the Company had grounds for a Termination For
Cause within 30 days after Executive has had his hearing before the Board,
Executive shall have the option of treating his employment as not having
terminated or as having been terminated pursuant to a Termination Without
Cause.

“Termination For Good Reason” means the occurrence of any of the following
after the occurrence of a Potential Change of Control or a Change of
Control:

(i) (A) the assignment to Executive of any duties inconsistent in any
material adverse respect with Executive’s position, duties, authority
or responsibilities as contemplated by Section 2 of this Agreement,
or (B) any other material adverse change in such position, including
titles, authority or responsibilities;

(ii) any failure by the Company to comply with any of the provisions
of Sections 3 and 4 of this Agreement at a level of least equal to
that in effect immediately preceding the Change of Control or a
Potential Change of Control, other than an insubstantial or
inadvertent failure remedied by the Company promptly after receipt of
notice thereof given by Executive;

(iii) the Company’s requiring Executive to be based at any office or
location more than 25 miles from the location at which he performed
his services specified under Section 2 hereof immediately prior to
the Change of Control or a Potential Change of Control, except for
travel reasonably required in the performance of Executive’s
responsibilities;

(iv) any failure by the Company to obtain the assumption and
agreement to perform this Agreement by a successor as contemplated by
Section 10(d) hereof; or

(v) any attempt by the Company to terminate the Executive’s
employment in a Termination For Cause that is determined by the Board
pursuant to Section 5(c) hereof, or in a proceeding pursuant to
Section 9 or Section 10 hereof, not to constitute a Termination For
Cause.

17

 

Notwithstanding the foregoing, a termination of Executive’s employment shall
not be treated as a Termination For Good Reason (I) if Executive shall have
consented in writing to the occurrence of the event giving rise to the claim
of Termination For
Good Reason, or (II) if Executive shall have delivered a Notice of
Termination to the Company, and the facts and circumstances specified
therein as providing a basis for such Termination For Good Reason are cured
by the Company within 10 days of its receipt of such Notice of Termination.

“Vested Benefits Enhancement” means (i) a cash amount equal to the present
value, calculated using a discount rate equal to the then prevailing
applicable Federal rate as determined under Section 1274(d) of the Internal
Revenue Code of 1986, as amended (the “Code”), of the additional retirement
benefits that would have been payable or available to Executive under any
ERPs, based on (A) the age and service Executive would have attained or
completed had Executive continued in the Company’s employ until the third
anniversary of the occurrence of the Change of Control, and (B) where
compensation is a relevant factor, his pensionable compensation as of the
Date of Termination, such compensation to include, on the same terms as
apply to other executives, any Severance Payment made to Executive, (ii)
solely for purposes of vesting in any benefits under any ESPs, Executive
shall be treated as having continued in the Company’s employ until the third
anniversary of the occurrence of such Change of Control, and (iii) solely
for purposes of determining eligibility for retiree medical benefits under
any retirement plan or any retiree welfare benefit plan, policy or program
of the Company or its affiliates, and any ERPs related thereto, Executive
shall be treated as having continued in the Company’s employ until the third
anniversary of the occurrence of such Change of Control and to have retired
on the last day of such period.

“Voluntary Termination Within 180 Days” means a termination of employment by
Executive for any reason within the first 180 days following a Change of
Control, and

“Voluntary Termination After 180 Days” means a termination of employment by
Executive other than a Termination For Good Reason, a Termination Due to
Disability by Executive, or a Termination Due to Death within the remaining
2 years and 6 months following a Change of Control.

“Welfare Benefits Continuation” shall have the same meaning as that
described in Section 5 hereof, except that the entitlement of Executive
and/or his dependents to participation in the Welfare Benefit Plans shall
continue until the third anniversary of the Date of Termination.

(e) Out-Placement Services. If the Employment Period terminates because of a
Termination Without Cause or a Termination For Good Reason, Executive shall be
entitled to out-placement services, provided by the Company or its designee at
the Company’s expense, for 12 months following the Date of Termination, or such
lesser period as the Executive may require such services.

18

 

(f) Certain Further Payments by Company.

(i) Tax Reimbursement Payment. In the event that any amount or benefit
paid or distributed to Executive pursuant to this Agreement, taken together
with any amounts or benefits otherwise paid or distributed to Executive by
the Company or any affiliate (collectively, the “Covered Payments”), are or
become subject to the tax (the “Excise Tax”) imposed under Section 4999 of
the Internal Revenue Code of 1986, as amended, or any similar tax that may
hereafter be imposed, the Company shall pay to the Executive at the time
specified in this Section an additional amount (the “Tax Reimbursement
Payment”) such that the net amount retained by the Executive with respect to
such Covered Payments, after deduction of any Excise Tax on the Covered
Payments and any Federal, state and local income tax and other tax on the
Tax Reimbursement Payment provided for by this Section, but before deduction
for any Federal, state or local income or employment tax withholding on such
Covered Payments, shall be equal to the amount of the Covered Payments.

(ii) Applicable Rules. For purposes of determining whether any of the
Covered Payments will be subject to the Excise Tax and the amount of such
Excise Tax,

(A) such Covered Payments will be treated as “parachute payments”
within the meaning of Section 280G of the Code, and all “parachute
payments” in excess of the “base amount” (as defined under Section
280G(b)(3) of the Code) shall be treated as subject to the Excise
Tax, unless, and except to the extent that, in the good faith
judgment of the Company’s independent certified public accountants
appointed prior to the Effective Date or tax counsel selected by such
accountants (the “Accountants”), the Company has a reasonable basis
to conclude that such Covered Payments (in whole or in part) either
do not constitute “parachute payments” or represent reasonable
compensation for personal services actually rendered (within the
meaning of Section 280G(b)(4)(B) of the Code) in excess of the “base
amount,” or such “parachute payments” are otherwise not subject to
such Excise Tax, and

(B) the value of any non-cash benefits or any deferred payment or
benefit shall be determined by the Accountants in accordance with the
principles of Section 280G of the Code.

(iii) Additional Rules. For purposes of determining the amount of the Tax
Reimbursement Payment, the Executive shall be deemed to pay: (A) Federal
income taxes at the highest applicable marginal rate of Federal income
taxation for the calendar year in which the Tax Reimbursement Payment is to
be made, and (B) any applicable state and local income and other taxes at
the highest applicable marginal rate of taxation for the calendar year in
which the Tax Reimbursement Payment is to be made, net of the maximum
reduction in Federal incomes taxes which could be obtained from the
deduction of such state or local taxes if paid in such year.

19

 

(iv) Repayment or Additional Payment in Certain Circumstances.

(A) Repayment. In the event that the Excise Tax is subsequently
determined by the Accountants or pursuant to any proceeding or
negotiations with the Internal Revenue Service to be less than the
amount taken into account hereunder in calculating the Tax
Reimbursement Payment made, Executive shall repay to the Company, at
the time that the amount of such reduction in the Excise Tax is
finally determined, the portion of such prior Tax Reimbursement
Payment that would not have been paid if such lesser Excise Tax had
been applied in initially calculating such Tax Reimbursement
Payment. Notwithstanding the foregoing, in the event any portion of
the Tax Reimbursement Payment to be repaid to the Company has been
paid to any Federal, state or local tax authority, repayment thereof
shall not be required until actual refund or credit of such portion
has been made to Executive by the applicable tax authority.
Executive and the Company shall mutually agree upon the course of
action to be pursued (and the method of allocating the expenses
thereof) if Executive’s good faith claim for refund or credit is
denied.

(B) Additional Tax Reimbursement Payment. In the event that the
Excise Tax is later determined by the Accountants or pursuant to any
proceeding or negotiations with the Internal Revenue Service to
exceed the amount taken into account hereunder at the time the Tax
Reimbursement Payment is made (including, but not limited to, by
reason of any payment the existence or amount of which cannot be
determined at the time of the Tax Reimbursement Payment), the Company
shall make an additional Tax Reimbursement Payment in respect of such
excess (plus any interest or penalty payable with respect to such
excess) at the time that the amount of such excess is finally
determined.

(v) Timing for Tax Reimbursement Payment. The Tax Reimbursement Payment
(or portion thereof) provided for in this Section 6 shall be paid to
Executive not later than 10 business days following the payment of the
Covered Payments; provided, however, that if the amount of such Tax
Reimbursement Payment (or portion thereof) cannot be finally determined on
or before the date on which payment is due, the Company shall pay to
Executive by such date an amount estimated in good faith by the Accountants
to be the minimum amount of such Tax Reimbursement Payment and shall pay the
remainder of such Tax Reimbursement Payment (together with interest at the
rate provided in Section 1274(b)(2)(B) of the Code) as soon as the amount
thereof can be determined, but in no event later than 45 calendar days after
payment of the related Covered Payment. To the extent that the amount of
the estimated Tax Reimbursement Payment exceeds the amount subsequently
determined to have been due, Executive shall repay such excess to the
Company on the fifth business day after written demand by the Company for
payment.

20

 

7. Timing of Payments.

Accrued Salary, Severance Payments and Vested Benefits Enhancements shall be
paid no later than 10 days following the termination of the Employment Period.
Pro-Rata Target Bonus shall be paid as follows: (a) if the Employment Period
terminates in the first, second or third calendar quarter of any particular
calendar year, then the Pro-Rata Target Bonus shall be paid no later than 10
days following the termination of the Employment Period; or (b) if the
Employment Period terminates in the fourth calendar quarter of any particular
calendar year, then the Pro-Rata Target Bonus shall be paid no later than the
same time as similar awards are paid to other executives participating in the
plans or programs under which the awards are paid, but in no event later than
March 31 of the calendar year following the end of such fourth calendar
quarter. Vested Benefits and Equity Awards shall be paid no later than the time
for payment Determined Under the Applicable Plan except as otherwise expressly
superseded or modified by this Agreement. Tax Reimbursement Payments shall be
paid at the time specified in Section 6 hereof. Notwithstanding the foregoing,
solely for purposes of amounts payable pursuant to Section 5 hereof, if any
amount payable to Executive pursuant to Section 5 would be nondeductible by the
Company under Section 162(m) of the Code if paid in the year of Executive’s
termination, the Company shall have the option of paying such nondeductible
amount, with interest at the one-year treasury bill rate as in effect on the
date of such termination as reported in the Wall Street Journal, on the first
day of the second calendar quarter in the year following such termination.

8. Full Discharge of Company Obligations.

Except in the case of amounts payable to Executive in the event of a
termination of employment following a Potential Change of Control as described
in the first paragraph of Section 6, and except as expressly provided in the
last sentence of this Section 8, the amounts payable to Executive pursuant to
Section 5 following termination of his employment (including amounts payable
with respect to Vested Benefits) shall be in full and complete satisfaction of
Executive’s rights under Section 5 of this Agreement and any other claims he
may have in respect of his employment by the Company or any of its affiliates.
Such amounts shall constitute liquidated damages with respect to any and all
such rights and claims and, upon Executive’s receipt of such amounts, the
Company shall be released and discharged from any and all liability to
Executive in connection with Section 5 of this Agreement or otherwise in
connection with Executive’s employment with the Company and its affiliates.
Nothing in this Section 8 shall be construed to release the Company from its
obligation to indemnify Executive as provided in Section 4(e) hereof.

9. Noncompetition, Confidentiality and Other Covenants.

By and in consideration of the compensation and benefits to be provided by the
Company hereunder, including the severance arrangements set forth herein,
Executive agrees to the following:

21

 

(a) Noncompetition. During the Employment Period and until the earlier of:
(i) the last day of the one year period following any Voluntary Termination
of the Employment Period by Executive pursuant to Section 5 hereof, or (ii)
the date a Change of Control occurs (the “Restriction Period”), Executive
shall not engage in competition with The Hartford. For purposes of this
term, “Competition” is defined as: (1) your direct and/or indirect
participation in the calling upon, soliciting business, or providing
property and casualty or life insurance products to any person or entity who
at the time of your termination from the Company is a current customer or
client of The Hartford; and (2) your direct and/or indirect participation
with regard to inducing or attempting to induce any agency, broker,
broker-dealer, financial planner or supplier of The Hartford to terminate
their Hartford agency contract with The Hartford. Notwithstanding anything
herein to the contrary, the terms of this Section 9(a) shall not apply in
the event of any termination of employment following a Change of Control as
provided for in Section 6 of this Agreement, including any termination
following a potential Change of Control as described in the first paragraph
of Section 6.

(b) Confidentiality. Without the prior written consent of the Company,
except to the extent required by an order of a court having competent
jurisdiction or under subpoena from an appropriate government agency,
Executive shall not disclose to any third person, or permit the use of for
the benefit of any person or any entity other than The Company or its
affiliates, any trade secrets, customer lists, information regarding product
development, marketing plans, sales plans, management organization
information (including data and other information relating to members of the
Board and management), operating policies or manuals, business plans,
financial records, or other financial, organizational, commercial, business,
sales, marketing, technical, product or employee information relating to
the Company or its affiliates or information designated as confidential,
proprietary, and/or a trade secret, or any other information relating to the
Company or its affiliates that Executive knows from the circumstances, in
good faith and good conscience, should be treated as confidential, or any
information that the Company or its affiliates may receive belonging to
customers, agents or others who do business with the Company or its
affiliates, except to the extent that any such information previously has
been disclosed to the public by the Company or is in the public domain
(other than by reason of Executive’s violation of this Section 9(b)).

(c) Non-Solicitation of Employees. During the Employment Period and until
the earlier of: (i) the last day of the one year period following any
Voluntary Termination of the Employment Period by Executive pursuant to
Section 5 hereof, or (ii) the date a Change of Control occurs, Executive
shall not directly or indirectly solicit, encourage or induce any employee
of the Company or its affiliates to terminate employment with such entity,
and shall not directly or indirectly, either individually or as owner,
agent, employee, consultant or otherwise, employ or offer employment to any
person who is or was employed by the Company or an affiliate thereof unless
such person shall have ceased to be employed by such entity for a period of
at least six months. Notwithstanding anything herein to the contrary, the
terms of this Section

22

 

9(c) shall not apply in the event of any termination of employment following
a Change of Control as provided for in Section 6 of this Agreement,
including any termination following a potential Change of Control as
described in the first paragraph of Section 6.

(d) Company Property. Except as expressly provided herein, promptly
following any termination of the Employment Period, Executive shall return
to the Company all property of the Company, and all copies thereof in
Executive’s possession or under his control.

(e) Injunctive Relief and Other Remedies with Respect to Covenants.
Executive acknowledges and agrees that the covenants and obligations of
Executive with respect to noncompetition, confidentiality, nonsolicitation,
and Company property relate to special, unique and extraordinary matters and
that a violation of any of the terms of such covenants and obligations will
cause the Company irreparable injury for which adequate remedies are not
available at law. Therefore, Executive agrees that the Company (i) shall be
entitled to an injunction, restraining order or such other equitable relief
(without the requirement to post bond) restraining Executive from committing
any violation of the covenants and obligations contained in this Section 9,
and (ii) shall have no further obligation to pay unearned compensation,
incentive awards, unvested awards, or bonus payments to Executive hereunder
following any material violation of the covenants and obligations contained
in this Section 9. These remedies are cumulative and are in addition to any
other rights and remedies the Company may have at law or in equity. In
connection with the foregoing provisions of this Section 9, Executive
represents that his economic means and circumstances are such that such
provisions will not prevent him from providing for himself and his family on
a basis satisfactory to him. Notwithstanding the foregoing, in no event
shall an asserted violation of the provisions of this Section constitute a
basis for deferring or withholding any amounts otherwise payable to the
Executive under this Agreement following a Change of Control.

     10. Miscellaneous.

(a) Survival. All of the provisions of Sections 5 (relating to termination
of the Employment Period prior to a Change of Control), 6 (relating to
termination of the Employment Period following a Change of Control or a
Potential Change of Control), 9 (relating to noncompetition,
confidentiality, nonsolicitation and Company property), 10(b) (relating to
arbitration), 10(c) (relating to legal fees) and 10(n) (relating to
governing law) of this Agreement shall survive the termination of this
Agreement.

(b) Arbitration. Except as provided in Section 9, any dispute or
controversy arising under or in connection with this Agreement shall be
resolved by binding arbitration. Such arbitration shall be held in the city
of Hartford, Connecticut and except to the extent inconsistent with this
Agreement, shall be conducted in accordance with the

23

 

Commercial Arbitration Rules of the American Arbitration Association in
effect at the time of the arbitration, and otherwise in accordance with the
principles that would be applied by a court of law or equity. The
arbitrator shall be acceptable to both the Company and Executive. If the
parties cannot agree on an acceptable arbitrator, the dispute or controversy
shall be heard by a panel of three arbitrators; one appointed by each of the
parties and the third appointed by the other two arbitrators. The Company
and Executive further agree that they will abide by and perform any award or
awards rendered by the arbitrators and that a judgment may be entered on any
award or awards rendered by any state or federal court having jurisdiction
over the Company or Executive or any of their respective property.

(c) Legal Fees and Expenses. In any contest (whether initiated by
Executive or by the Company) as to the validity, enforceability or
interpretation of any provision of this Agreement, the Company shall pay
Executive’s legal expenses (or cause such expenses to be paid) including,
without limitation, his reasonable attorney’s fees, on a quarterly basis,
upon presentation of proof of such expenses in a form acceptable to the
Company, provided that Executive shall reimburse the Company for such
amounts, plus simple interest thereon at the 90-day United States Treasury
Bill rate as in effect from time to time, compounded annually, if Executive
shall not prevail, in whole or in part, as to any material issue as to the
validity, enforceability or interpretation of any provision of this
Agreement.

(d) Successors; Binding Effect. This Agreement shall inure to the benefit
of and be binding upon the Company and its successors. The Company shall
require any successor to all or substantially all of the business and/or
assets of the Company, whether direct or indirect, by purchase, merger,
consolidation, acquisition of stock, or otherwise, by an agreement in form
and substance satisfactory to Executive, expressly to assume and agree to
perform this Agreement in the same manner and to the same extent as the
Company would be required to perform the Agreement if no such succession had
taken place. This Agreement is personal to the Executive and, without the
prior written consent of the Company, shall not be assignable by Executive
otherwise than by will or the law of descent and distribution. This
Agreement shall inure to the benefit of and be enforceable by Executive’s
legal representatives.

(e) Assignment. Except as provided in Section 10(d), neither this Agreement
nor any of the rights or obligations hereunder shall be assigned or
delegated by any party hereto without the prior written consent of the other
party.

(f) Entire Agreement. This Agreement constitutes the entire agreement
between the parties hereto with respect to the matters referred to herein.
This Agreement supersedes and replaces any prior employment or severance
agreement or arrangement between the Company and Executive. No other
agreement relating to the terms of Executive’s employment by the Company,
oral or otherwise, shall be binding between the parties unless it is in
writing and signed by the party against whom enforcement is sought. There
are no promises, representations, inducements or

24

 

statements between the parties other than those that are expressly contained
herein. Executive acknowledges that he is entering into this Agreement of
his own free will and accord, and with no duress, and that he has read this
Agreement and that he understands it and its legal consequences.

(g) Severability; Reformation. In the event that one or more of the
provisions of this Agreement shall become invalid, illegal or unenforceable
in any respect, the validity, legality and enforceability of the remaining
provisions contained herein shall not be affected thereby. In the event of
a determination that any of the provisions of Section 9(a), Section 9(b) or
Section 9(c) are not enforceable in accordance with their terms, Executive
and the Company agree that such Section shall be reformed to make such
Section enforceable in a manner that provides the Company the maximum rights
permitted at law.

(h) Waiver. Waiver by any party hereto of any breach or default by the
other party of any of the terms of this Agreement shall not operate as a
waiver of any other breach or default, whether similar to or different from
the breach or default waived. No waiver of any provision of this Agreement
shall be implied from any course of dealing between the parties hereto or
from any failure by either party hereto to assert its or his rights
hereunder on any occasion or series of occasions.

(i) Notices. Any notice required or desired to be delivered under this
Agreement shall be in writing and shall be delivered personally, by courier
service, by registered mail, return receipt requested, or by telecopy and
shall be effective upon actual receipt by the party to which such notice
shall be directed, and shall be addressed as follows (or to such other
address as the party entitled to notice shall hereafter designate in
accordance with the terms hereof):

	 	 	 
	If to the Company:

	 	The Hartford Financial Services Group, Inc.

Law Department, HO-1-09

Hartford Plaza

Hartford, CT 06115

Attention: Corporate Secretary
	 
	 	 
	with a copy to:

	 	Debevoise & Plimpton

875 Third Avenue

New York, NY 10022

Attn: Lawrence K. Cagney, Esq.
	 
	 	 
	If to Executive:

	 	The home address of Executive

shown on the records of the Company

(j) Amendments. This Agreement may not be altered, modified or amended
except by a written instrument signed by each of the parties hereto.

25

 

(k) Headings. Headings to provisions of this Agreement are for the
convenience of the parties only and are not intended to be part of or to
affect the meaning or interpretation hereof.

(l) Counterparts. This Agreement may be executed in counterparts, each of
which shall be deemed an original but all of which together shall constitute
one and the same instrument.

(m) Withholding. Any payments provided for herein shall be reduced by any
amounts required to be withheld by the Company from time to time under
applicable Federal, State or local income or employment tax laws or similar
statutes or other provisions of law then in effect.

(n) Governing Law. This Agreement shall be governed by the laws of the
State of Connecticut, without reference to principles of conflicts or choice
of law under which the law of any other jurisdiction would apply.

26FORM OF EMPLOYMENT AGREEMENT

 

Exhibit 10.05

EMPLOYMENT AGREEMENT

     EMPLOYMENT AGREEMENT, dated as of April 26, 2001, by and between The
Hartford Financial Services Group, Inc., a Delaware corporation (the
“Company”), and David M. Johnson (“Executive”).

W I T N E S S E T H:

          WHEREAS, the Company desires that Executive perform substantial services
for the Company and to enter into an agreement embodying the terms of such
employment (the “Agreement”); and

          WHEREAS, Executive desires to perform such services, enter into such
employment and enter into such Agreement;

          NOW, THEREFORE, in consideration of the mutual covenants herein contained,
the Company and Executive hereby agree as follows:

1. Employment.

(a) Agreement to Employ. Upon the terms and subject to the conditions
of this Agreement, the
Company hereby agrees to employ Executive and Executive hereby agrees to his
employment by the Company.

(b) Term of Employment. Except as otherwise provided below, the Company
shall employ Executive for the period commencing on May 1, 2001 (the
“Commencement Date”) and ending on the third anniversary of the Commencement
Date. At the expiration of the original term or any extended term (each a
“Renewal Date”), Executive’s employment hereunder shall be extended
automatically, upon the same terms and conditions, for successive one-year
periods, unless either party shall give written notice to the other of its
intention not to renew such employment at least fifteen months prior to such
Renewal Date. Without limiting the generality of the foregoing, upon the
occurrence of a Change of Control (as defined below), the term of this
Agreement shall be extended automatically without any action by either party
until the third anniversary of such Change of Control. Notwithstanding the
foregoing, if not previously terminated pursuant to Sections 1(b), 5(a) or
6(a), the term of this Agreement shall terminate on the last day of the
month in which Executive attains age 65, and such a termination upon
Executive reaching age 65 shall be deemed to be a Termination Due to
Retirement for purposes of this Agreement. The period during which
Executive is employed pursuant to this Agreement, including any extension
thereof in accordance with this Section 1(b), shall be referred to as the
“Employment Period.”

1

 

2. Position and Duties.

During the Employment Period, Executive shall serve as Executive Vice President
and Chief Financial Officer and as a member of the Office of the Chairman of
the Company, and in such other position or positions with the Company or its
affiliates commensurate with such position and his experience as the Board of
Directors of the Company (the “Board”) shall from time to time specify. During
the Employment Period, Executive shall have the duties, responsibilities and
obligations customarily assigned to individuals serving in the position or
positions in which Executive serves hereunder and such other duties,
responsibilities and obligations as the Board shall from time to time specify
commensurate with such positions. Executive shall devote his full time to the
services required of him hereunder, except for vacation time and reasonable
periods of absence due to sickness, personal injury or other disability, and
shall use his best efforts, judgment, skill and energy to perform such services
in a manner consonant with the duties of his position and to improve and
advance the business and interests of the Company and its affiliates. During
the Employment Period, Executive shall comply with the Code of Corporate
Conduct of the Company. Unless and to the extent inconsistent with the terms
of any published Company policy or code of conduct as in effect on the date
hereof and as hereafter amended, nothing contained herein shall preclude
Executive from (a) serving on the board of directors of any business
corporation with the consent of the Board, (b) serving on the board of, or
working for, any charitable or community organization, or (c) pursuing his
personal financial and legal affairs, so long as the foregoing activities,
individually or collectively, do not interfere with the performance of
Executive’s duties hereunder or violate any of the provisions of Section 9
hereof.

3. Compensation.

(a) Base Salary. During the Employment Period, the Company shall pay
Executive a base salary at the annual rate as in effect on the date hereof.
The annual base salary payable under this paragraph shall be reduced,
however, to the extent that Executive elects to defer such salary under the
terms of any deferred compensation or savings plan or arrangement maintained
or established by the Company or its affiliates. The Board or the
appropriate committee of the Board may in its discretion periodically review
Executive’s base salary in light of competitive practices, the base salaries
paid to other executive officers of the Company and the performance of
Executive and the Company and its applicable affiliates, and may, in its
discretion, increase such base salary by an amount it determines to be
appropriate. Any such increase shall not reduce or limit any other
obligation of the Company hereunder. Executive’s base salary (as set forth
above or as may be increased from time to time) shall not be reduced
following any Change of Control, but may be reduced prior to a Change of
Control solely pursuant to a cost-saving plan or structural realignment of
total compensation elements that includes all senior executives and only to
the extent that such reduction is proportionate to the reductions applicable
to other senior executives. Executive’s annual base salary payable
hereunder, as it may be increased or reduced from time to time as provided
herein and without reduction for any amounts deferred as described above,
shall be referred to herein as “Base Salary.” The Company shall pay
Executive the portion of his Base Salary not deferred not less frequently
than in equal monthly installments.

(b) Annual Bonus. For each calendar year ending during the Employment
Period, Executive shall have the opportunity to earn and receive an annual
bonus, based on the achievement of target levels of

2

 

performance, equal to the percentage of his Base Salary used to calculate
such annual bonus as of the date hereof. Executive’s annual bonus
opportunity may be increased above such percentage from time to time by the
Board or the appropriate committee thereof. Executive’s annual bonus
opportunity shall not be reduced following any Change of Control, but may be
reduced prior to a Change of Control solely pursuant to a cost-saving plan
or structural realignment of total compensation elements that includes all
senior executives and only to the extent that such reduction is
proportionate to the reductions applicable to other senior executives.
Executive’s annual bonus opportunity, as it may be increased or reduced from
time to time as provided herein, shall be referred to herein as “Target
Bonus.” The actual bonus, if any, payable for any such year shall be
determined in accordance with the terms of the Company’s Annual Executive
Bonus Program or any successor annual incentive plan (the “Annual Plan”)
based upon the performance of the Company and/or its applicable affiliates
and/or Executive against target objectives established under such Annual
Plan. Subject to Executive’s election to defer all or a portion of any
annual bonus payable hereunder pursuant to the terms of any deferred
compensation or savings plan or arrangement maintained or established by the
Company or its affiliates, any annual bonus payable under this Section 3(b)
shall be paid to Executive in accordance with the terms of the Annual Plan.

(c) Long-term Incentive Compensation. During the Employment Period,
Executive shall participate in all of the Company’s existing and future
long-term incentive compensation programs for key executives at a level
commensurate with his position with the Company and consistent with the
Company’s then current policies and practices, as determined in good faith
by the Board or the appropriate committee of the Board.

4. Benefits, Perquisites and Expenses.

(a) Benefits. During the Employment Period, Executive (and, to the extent
applicable, his dependents) shall be eligible to participate in or be
covered under (i) each welfare benefit plan or program maintained or as
hereafter amended or established by the Company or its applicable
affiliates, including, without limitation, each group life, hospitalization,
medical, dental, health, accident or disability insurance or similar plan or
program of thereof, and (ii) each applicable pension, retirement, savings,
deferred compensation, stock purchase or other similar plan or program
maintained or as hereafter amended or established by the Company or its
applicable affiliates, in each case to the extent that Executive is eligible
to participate in any such plan or program under the generally applicable
provisions thereof. Nothing in this Section 4(a) shall limit the Company’s
right to amend or terminate any such plan or program in accordance with the
procedures set forth therein or as permitted by applicable law.

(b) Perquisites. For each calendar year during the Employment Period,
Executive shall be entitled to at least the number of paid vacation days per
year that Executive is entitled to as of the date

3

 

hereof, and shall also be entitled to receive such other perquisites as are
generally provided to him as of the date hereof or are hereafter provided to
other similarly situated senior executives of the Company in accordance with
the then current policies and practices of the Company.

(c) Business Expenses. During the Employment Period, the Company shall pay
or reimburse Executive for all reasonable business expenses incurred or paid
by Executive in the performance of Executive’s duties hereunder, upon
presentation of expense statements or vouchers and such other information as
the Company may require and in accordance with the generally applicable
policies and procedures of the Company.

(d) Office and Support Staff. During the Employment Period, Executive
shall be entitled to an office with furnishings and other material
appointments, and to secretarial and other assistance, at a level that is at
least commensurate with the foregoing provided to him as of the date hereof
or is hereafter provided to other similarly situated senior executives of
the Company.

(e) Indemnification. The Company shall indemnify Executive and hold
Executive harmless from and against any claim, loss or cause of action,
regardless whether asserted during or after the Employment Period, arising
from or out of Executive’s performance as an officer, director or employee of
the Company or any of its affiliates or in any other capacity, including any
fiduciary capacity, in which Executive serves at the request of the Company,
to the maximum extent permitted by applicable law and under the Certificate
of Incorporation and By-Laws of the Company, as may be amended from time to
time (the “Governing Documents”), whichever is greater, provided that in no
event shall the protection afforded to Executive be less than that afforded
under the Governing Documents as in effect on the Commencement Date.

5. Termination of Employment.

The provisions of this Section 5 shall apply prior to the occurrence of a
Change of Control and, if Executive is still in the Company’s employ, shall
again become applicable upon the third anniversary of such Change of Control.

(a) Early Termination of the Employment Period. Notwithstanding
Section 1(b) hereof, the Employment Period shall end upon the earliest
to occur of (i) a Termination For Cause, (ii) a Termination Without
Cause, (iii) a Voluntary Termination, (iv) a Termination Due to
Retirement, (v) a Termination Due to Disability, or (vi) a Termination
Due to Death.

(b) Notice of Termination. Communication of termination under this
Section 5 shall be made to the other party by Notice of Termination in
the case of (i) a Termination For Cause, (ii) a Termination Without
Cause, or (iii) a Voluntary Termination.

4

 

(c) Benefits Payable Upon Termination; Rules for Determining Reason
for Termination.

(i) Benefits Payable Upon Termination. Following the end of the
Employment Period pursuant to Section 5(a), Executive (or, in the
event of his death, his surviving spouse, if any, or if none, his
estate) shall be paid the type or types of compensation
determined to be payable in accordance with the following table,
such payment to be made in the form specified in such table and
at the time established pursuant to Section 7 hereof.
Capitalized terms used in such table shall have the meanings set
forth in Section 5(d) hereof.

(ii) Rules for Determining Reason for Termination.

(A) If a Voluntary Termination occurs on a date that
Executive is eligible for Retirement as defined in The
Hartford Investment and Savings Plan, as may be amended
from time to time, or any successor plan thereof (the
“Savings Plan”), such Voluntary Termination shall instead
be treated as a Termination Due to Retirement solely for
purposes of this Section 5.

(B) No Termination Without Cause shall be treated as a
Termination Due to Retirement or a Termination Due to
Disability for purposes of any Pro Rata Target Bonus,
Severance Payment, Equity Awards or Vested Benefits
Enhancement under this Section 5, notwithstanding the fact
that, either on, before or after the date of termination of
the Employment Period with respect thereto, (I) Executive
was eligible for Retirement as defined in the Savings Plan,
(II) Executive requested to be treated as a retiree for
purposes of the Savings Plan or any other plan or program
of the Company or its affiliates, or (III) Executive or the
Company could have terminated Executive’s employment as a
Termination Due to Disability hereunder.

5

 

BENEFITS PAYABLE : NON-CHANGE OF CONTROL

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 	Welfare
	 	 	Accrued	 	Pro Rata Target	 	Severance	 	 	 	 	 	Vested Benefits	 	Benefits
	BENEFIT:
	 	Salary
	 	Bonus
	 	Payment
	 	Equity Awards
	 	Vested Benefits
	 	Enhancement
	 	Continuation

	 	 	 	 	 	 	 	 	Determined Under	 	Determined Under	 	 	 	Determined Under
	FORM OF PAYMENT:
	 	Lump Sum
	 	Lump Sum
	 	Lump Sum
	 	the Applicable Plan
	 	the Applicable Plan
	 	Lump Sum
	 	the Applicable Plan

	Termination For

Cause

	 	Payable
	 	Not Payable
	 	Not Payable
	 	Not Payable
	 	Determined Under

the Applicable Plan
	 	Not Payable
	 	Not

Available
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Termination Without

Cause

	 	Payable
	 	Payable
	 	Payable
	 	Options /Restricted

Stock:

Payable

Other Equity

Awards: Determined

Under the

Applicable Plan
	 	Determined Under

the Applicable Plan
	 	Payable
	 	Available
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Voluntary

Termination

	 	Payable
	 	Determined Under

the Applicable Plan
	 	Not

Payable
	 	Determined Under

the Applicable Plan
	 	Determined Under

the Applicable Plan
	 	Not Payable
	 	Not Available
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Termination Due to
Retirement

	 	Payable
	 	Determined Under

the Applicable Plan
	 	Not Payable
	 	Determined Under

the Applicable Plan
	 	Determined Under

the Applicable Plan
	 	Not Payable
	 	Available
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Termination Due to
Disability

	 	Payable
	 	Payable
	 	Not Payable
	 	Determined Under

the Applicable Plan
	 	Determined Under

the Applicable Plan
	 	Not Payable
	 	Available
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Termination Due to
Death

	 	Payable
	 	Payable
	 	Not Payable
	 	Determined Under

the Applicable Plan
	 	Determined Under

the Applicable Plan
	 	Not Payable
	 	Not Available

6

 

(d) Definitions.

“Accrued Salary” means any Base Salary earned, but unpaid, for
services rendered to the Company on or prior to the date on which the
Employment Period ends pursuant to Section 5(a) (other than Base
Salary deferred pursuant to Executive’s election, as contemplated by
Section 3(a) hereof), plus any vacation pay accrued by Executive as
of such date.

“Available” means that the particular benefit shall be made available
to Executive to the extent specifically provided herein or required
by applicable law.

“Determined Under the Applicable Plan” means that the determination
of whether a particular benefit shall or shall not be paid to
Executive, and, where specifically required by this Agreement, the
timing or form of any benefit payment, shall be made solely by
application of the terms of the plan or program providing such
benefit, except to the extent that the terms of such plan or program
are expressly superseded or modified by this Agreement.

“Equity Awards” means the outstanding stock option, restricted
stock, performance share and other equity or long-term incentive
compensation awards, if any, held by Executive as of the date of his
termination.

“ERPs” means any excess cash balance retirement plans maintained or
as hereafter amended or established by the Company or its applicable
affiliates.

“ESPs” means any excess investment and savings plans maintained or as
hereafter amended or established by the Company or its applicable
affiliates.

“Lump Sum” means a single lump sum cash payment.

“Not Available” means that the particular benefit shall be not be
made available to Executive, except to the extent required by
applicable law.

“Notice of Termination” means (i) in the case of a Termination For
Cause, a written notice given by the Company to Executive within 30
calendar days of the Company’s having actual knowledge of the events
giving rise to such Termination For Cause, (ii) in the case of a
Termination Without Cause, a written notice given by the Company to
Executive at least 30 calendar days before the effective date of such
Termination Without Cause, and (iii) in the
case of a Voluntary Termination, a written notice given by Executive
to the Company indicating the effective date of Executive’s
termination of the Employment Period in such Voluntary Termination,
such effective date to be no earlier than 30 days following the date
such notice is received by the Company from Executive.

7

 

“Not Payable” means (i) with respect to benefits other than Equity
Awards, such benefits shall not be paid or otherwise provided to
Executive, and (ii) with respect to Equity Awards, such Equity
Awards, to the extent unvested, unexercisable, or subject to
restrictions that have not yet lapsed, shall be forfeited and/or
canceled as of the date of termination of the Employment Period,
unless otherwise determined by the Board or the appropriate committee
of the Board in its discretion.

“Payable” means (i) with respect to benefits other than those
described in clause (ii) of this paragraph, such benefits shall be
paid to Executive in the amount, at the time, and in the form
specified herein, and (ii) with respect to benefits described in this
clause (ii), the following shall apply solely in the event of a
Termination Without Cause, notwithstanding anything in the applicable
plan or program to the contrary: (A) with respect to any outstanding
stock options not yet expired as of the date of termination of the
Employment Period, Executive shall be treated as though he remained
in the employ of the Company for the two year period following such
date, and except to the extent that any such options first expire
during such period under the applicable plan or program, (I) any such
options that would have become vested over such two year period
solely by reason of Executive remaining in the employ of the Company
during such period shall become immediately vested and
nonforfeitable, (II) with respect to any options that by their terms
would vest if the stock of the Company or an affiliate were to reach
a specified market price, such options shall become vested and
nonforfeitable if and when such stock reaches such price during such
two year period, and (III) Executive shall have an additional two
years to exercise any vested options (beyond the time to exercise
such options permitted under the applicable plan or program), and (B)
with respect to any restricted stock subject to restrictions that
have not yet lapsed as of the date of termination of the Employment
Period, such restrictions shall be deemed to have lapsed and such
restricted stock shall become immediately vested and nonforfeitable
as of such date.

“Pro-Rata Target Bonus” means an amount equal to the product of: (i)
an amount equal to the Target Bonus Executive would have been
entitled to receive under Section 3(b) for the calendar year in which
the Employment Period terminates, and (ii) a fraction (the “Service
Fraction”), the numerator of which is equal to the number of rounded
months (rounded to the nearest number of whole months) in such
calendar year which have elapsed as of the date of such termination,
and the denominator of which is 12; provided that, if the Employment
Period terminates in the last quarter of any calendar year, the
Pro-Rata Target Bonus shall be the amount determined under the above
formula or, if greater, the product of: (A) the bonus that would
have been paid to Executive based on actual performance for such
calendar year, and (B) the Service Fraction.

8

 

“Severance Payment” means an amount equal to two times the sum of:
(i) Executive’s Base Salary, and (ii) Executive’s Target Bonus amount
under Section 3(b) hereof for the calendar year in which the
Employment Period terminates.

“Termination Due to Death” means a termination of Executive’s
employment due to the death of Executive.

“Termination Due to Disability” means (i) a termination of
Executive’s employment by the Company as a result of a determination
by the Board or the appropriate committee thereof that Executive has
been incapable of substantially fulfilling the positions, duties,
responsibilities and obligations set forth in this Agreement on
account of physical, mental or emotional incapacity resulting from
injury, sickness or disease for a period of (A) at least four
consecutive months, or (B) more than six months in any twelve month
period, or (ii) Executive’s termination of employment on account of
Disability as defined in The Hartford Investment and Savings Plan, as
may be amended from time to time.

“Termination Due to Retirement” means Executive’s termination of
employment on account of Executive’s Retirement as defined in The
Hartford Investment and Savings Plan, as may be amended from time to
time.

“Termination For Cause” means a termination of Executive’s employment
by the Company for any of the following reasons: (i) Executive is
convicted of or enters a plea of guilty or nolo contendere to a
felony, a crime of moral turpitude, dishonesty, breach of trust or
unethical business conduct, or any crime involving the business of
the Company or its affiliates; (ii) in the performance of his duties
hereunder or otherwise to the detriment of the Company or its
affiliates, Executive engages in (A) willful misconduct, (B) willful
or gross neglect, (C) fraud, (D) misappropriation, (E) embezzlement,
or (F) theft; (iii) Executive willfully fails to adhere to the
policies and practices of the Company or devote substantially all of
his business time and effort to the affairs thereof, or disobeys the
directions of the Board to do either of the foregoing; (iv) Executive
breaches this Agreement in any material respect; (v) Executive is
adjudicated in any civil suit to have committed, or acknowledges in
writing or in any agreement or stipulation his commission, of any
theft, embezzlement, fraud or other intentional act of dishonesty
involving any other person; or (vi) Executive knowingly and in a
material respect violates the Code of Corporate Conduct of the
Company. Executive shall be permitted to respond and defend himself
before the Board within 30 days after delivery to Executive of
written notification of any proposed Termination For Cause that
specifies in detail the reasons for such termination. If the
majority of the members of the Board (excluding Executive) do not
confirm that the Company had grounds for a Termination For Cause
within 30 days after Executive has had his hearing before the Board,
Executive shall have the option of treating his employment as not
having terminated or as having been terminated in a Termination
Without Cause.

9

 

“Termination Without Cause” means any involuntary termination of
Executive’s employment by the Company other than a Termination For
Cause, a Termination Due to Disability or a Termination Due to Death,
and shall further mean the Company’s requiring Executive to be based
at any office or location more than twenty-five (25) miles from the
location at which he performs his services set forth in this
Agreement as of the Commencement Date, except for travel reasonably
required in the performance of Executive’s responsibilities.

“Vested Benefits” means amounts that are vested or that Executive is
otherwise entitled to receive, without the performance by Executive
of further services or the resolution of a contingency, under the
terms of or in accordance with any investment and savings plan or
cash balance retirement plan (including any plan providing retiree
medical benefits) of the Company or its affiliates, and any ERPs or
ESPs related thereto, and any deferred compensation or employee stock
purchase plan or similar plan or program of the Company or its
affiliates.

“Vested Benefits Enhancement” means (i) a cash amount equal to the
present value, calculated using a discount rate equal to the then
prevailing applicable Federal rate as determined under Section
1274(d) of the Internal Revenue Code of 1986, as amended (the
“Code”), of the additional retirement benefits that would have been
payable or available to Executive under any ERPs, based on (A) the
age and service Executive would have attained or completed had
Executive continued in the Company’s employ until the second
anniversary of the date of termination of the Employment Period, and
(B) where compensation is a relevant factor, his pensionable
compensation as of such date, such compensation to include, on the
same terms as apply to other executives, any Severance Payment made
to Executive, and (ii) solely for purposes of vesting in any benefits
under any ESPs, Executive shall be treated as having continued in the
Company’s employ until the second anniversary of the date of
termination of the Employment Period.

“Voluntary Termination” means any voluntary termination of
Executive’s Employment by Executive pursuant to this Section 5, other
than a Termination Due to Retirement or a Termination Due to
Disability by Executive.

“Welfare Benefits Continuation” means that until the second
anniversary of the date of termination of the Employment Period,
Executive and, if applicable, his dependents shall be entitled to
continue participation in the life and health insurance benefit plans
of the Company or its affiliates in which Executive and/or such
dependents were participating as of the date of termination of the
Employment Period, and such other welfare benefit plans thereof in
which the Company is required by law to permit the participation of
Executive and/or his dependents, (collectively, the “Welfare Benefit
Plans”). Such participation shall be on the same terms and
conditions (including the requirement that Executive pay any premiums
generally paid by an employee) as would apply if Executive were still
in the employ of the Company; provided that the continued

10

 

participation of Executive and/or his dependents in such Welfare
Benefit Plans shall cease on such earlier date as Executive may
become eligible for comparable welfare benefits provided by a
subsequent employer. To the extent that Welfare Benefits
Continuation cannot be provided under the terms of the applicable
plan, policy or program, the Company shall provide a comparable
benefit under another plan or from the Company’s general assets.

6. Termination Following a Change of Control or Potential Change of Control.

This Section 6 shall apply (instead of Section 5) during the period commencing
upon a Change of Control and continuing until the third anniversary thereof;
provided that, in the event that Executive’s employment is terminated by the
Company in a Termination Without Cause after the occurrence of a Potential
Change of Control and a Change of Control occurs within one year following the
date of such termination, then solely for purposes of this Agreement, Executive
shall be deemed to have remained in the Company’s employ until the occurrence
of the Change of Control and thereafter to have then been terminated by the
Company in a Termination Without Cause. As a result, Executive shall be
entitled to receive the excess of (i) the benefits payable in the event of a
Termination Without Cause under this Section 6, over (ii) the amount of any
benefits payable to Executive under Section 5.

(a) Early Termination of the Employment Period. Notwithstanding Section
1(b) hereof, the Employment Period shall end upon the earliest to occur of
(i) a Termination For Cause, (ii) a Termination Without Cause, (iii) a
Voluntary Termination Within 180 Days, (iv) a Voluntary Termination After
180 Days, (v) a Termination For Good Reason, (vi) a Termination Due to
Retirement, (vii) a Termination Due to Disability, or (viii) a Termination
Due to Death.

(b) Notice of Termination. Communication of termination under this Section
6 shall be made to the other party by Notice of Termination in the case of
(i) a Termination For Cause, (ii) a Termination Without Cause, (iii) a
Voluntary Termination Within 180 Days, (iv) a Voluntary Termination After
180 Days, or (v) a Termination For Good Reason.

(c) Benefits Payable Upon Termination; Rules for Determining Reason for
Termination.

(i) Benefits Payable Upon Termination.

(A) Following the end of the Employment Period,
Executive (or, in the event of his
death, his surviving spouse, if any, or if none, his estate)
shall be paid the type or types of compensation determined to be
payable in accordance with the following table, such payment to
be made in the form specified in such table and at the time
established pursuant to Section 7 hereof. Capitalized terms used
in such table (and otherwise in this Section 6) that are defined
in Section 5, and not specifically defined in Section 6(d)
hereof, shall have the meanings ascribed thereto under Section 5.
Where such a capitalized term is defined solely in Section 6(d),
or in both Section 5 and Section 6(d), such term shall have the
meaning ascribed to it in Section 6(d).

11

 

(B) The Company’s obligation to make the payments provided for
in this Section 6 and otherwise to perform its obligations under
this Section 6 shall not be affected by any set-off,
counterclaim, recoupment, defense or other claim, right or action
which the Company may have against Executive or others. In no
event shall Executive be obligated to seek other employment or
take any other action by way of mitigation of the amounts payable
to Executive under any of the provisions of this Section 6 and
such amounts shall not be reduced whether or not Executive
obtains other employment.

(ii) Rules for Determining Reason for Termination.

(A) No Termination Without Cause, Voluntary Termination Within
180
Days or Termination For Good Reason shall be treated as a
Termination
Due to Retirement or a Termination Due to Disability for purposes
of any
Pro Rata Target Bonus, Severance Payment, Equity Awards or Vested
Benefits Enhancement under this Section 6, notwithstanding the
fact that,
either on, before or after the Date of Termination with respect
thereto,
(I) Executive was eligible for Retirement as defined in the
Savings Plan,
(II) Executive requested to be treated as a retiree for purposes
of the Savings
Plan or any other plan or program of the Company or its
affiliates, or
(III) Executive or the Company could have terminated Executive’s
employment
in a Termination Due to Disability hereunder.

(B) No Termination Due to Retirement shall be treated as a
Voluntary
Termination After 180 Days for purposes of this Section 6,
notwithstanding the
fact that the Date of Termination for such Termination Due to
Retirement may
occur within 180 days following a Change of Control.

(C) Notwithstanding any provision in this Agreement to the
contrary, in the event of a Change of Control as described in
clause (iii) or clause (iv) of the definition of the term Change
of Control in Section 6(d) of this Agreement, if the employment
of Executive involuntarily terminates on or after the date of a
shareholder approval described in either of such clauses but
before the date of a consummation described in either of such
clauses, the date of termination of Executive’s employment shall
be deemed for the purposes of this Agreement to be the day
following the date of the applicable consummation.

12

 

BENEFITS PAYABLE: CHANGE OF CONTROL

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	Accrued	 	Pro Rata Target	 	Severance	 	 	 	 	 	Vested Benefits	 	Welfare
	BENEFIT
	 	Salary
	 	Bonus
	 	Payment
	 	Equity Awards
	 	Vested Benefits
	 	Enhancement
	 	Benefits Continuation

	FORM OF	 	 	 	 	 	 	 	Determined Under	 	Determined Under	 	 	 	Determined Under the
	PAYMENT
	 	Lump Sum
	 	Lump Sum
	 	Lump Sum
	 	the Applicable Plan
	 	the Applicable Plan
	 	Lump Sum
	 	Applicable Plan

	Termination For

Cause

	 	Payable
	 	Not Payable
	 	Not Payable
	 	Determined Under

the Applicable Plan
	 	Determined Under

the Applicable Plan
	 	Not Payable
	 	Not Available
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Termination Without

Cause

	 	Payable
	 	Payable
	 	Payable
	 	Determined Under

the Applicable Plan
	 	Determined Under

the Applicable Plan
	 	Payable
	 	Available
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Voluntary

Termination Within

180 Days

	 	Payable
	 	Payable
	 	Payable
	 	Determined Under

the Applicable Plan
	 	Determined Under

the Applicable Plan
	 	Payable
	 	Available
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Voluntary

Termination

After

180 Days

	 	Payable
	 	Not Payable
	 	Not Payable
	 	Determined Under

the Applicable Plan
	 	Determined Under

the Applicable Plan
	 	Not Payable
	 	Not Available
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Termination For

Good Reason

	 	Payable
	 	Payable
	 	Payable
	 	Determined Under

the Applicable Plan
	 	Determined Under

the Applicable Plan
	 	Payable
	 	Available
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Termination Due to
Retirement

	 	Payable
	 	Determined Under

the Applicable Plan
	 	Not Payable
	 	Determined Under

the Applicable Plan
	 	Determined Under

the Applicable Plan
	 	Not Payable
	 	Available
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Termination Due to
Disability

	 	Payable
	 	Payable
	 	Not Payable
	 	Determined Under

the Applicable Plan
	 	Determined Under

the Applicable Plan
	 	Not Payable
	 	Available
	 
	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	Termination Due to
Death

	 	Payable
	 	Payable
	 	Not Payable
	 	Determined Under

the Applicable Plan
	 	Determined Under

the Applicable

Plan
	 	Not Payable
	 	Not Available

13

 

(d) Definitions.

“Beneficial Owner” means any Person who, directly or indirectly, has the
right to vote or dispose of or has “beneficial ownership” (within the
meaning of Rule 13d-3 under the Securities Exchange Act of 1934, as amended
(the “Act”)) of any securities of a company, including any such right
pursuant to any agreement, arrangement or understanding (whether or not in
writing), provided that: (i) a Person shall not be deemed the Beneficial
Owner of any security as a result of an agreement, arrangement or
understanding to vote such security (A) arising solely from a revocable
proxy or consent given in response to a public proxy or consent solicitation
made pursuant to, and in accordance with, the Act and the applicable rules
and regulations thereunder, or (B) made in connection with, or to otherwise
participate in, a proxy or consent solicitation made, or to be made,
pursuant to, and in accordance with, the applicable provisions of the Act
and the applicable rules and regulations thereunder, in either case
described in clause (A) or (B) above, whether or not such agreement,
arrangement or understanding is also then reportable by such Person on
Schedule 13D under the Act (or any comparable or successor report); and (ii)
a Person engaged in business as an underwriter of securities shall not be
deemed to be the Beneficial Owner of any security acquired through such
Person’s participation in good faith in a firm commitment underwriting until
the expiration of forty days after the date of such acquisition.

“Change of Control” means:

(i) a report on Schedule 13D shall be filed with the Securities and
Exchange Commission pursuant to Section 13(d) of the Act disclosing
that any Person, other than the Company or a subsidiary of the
Company or any employee benefit plan sponsored by the Company or a
subsidiary of the Company, is the Beneficial Owner of twenty percent
or more of the outstanding stock of the Company entitled to vote in
the election of directors of the Company;

(ii) any Person, other than the Company or a subsidiary of the
Company or any employee benefit plan sponsored by the Company or a
subsidiary of the Company, shall purchase shares pursuant to a tender
offer or exchange offer to acquire any stock of the Company (or
securities convertible into stock) entitled to vote in the election
of directors of the Company for cash, securities or any other
consideration, provided that after consummation of the offer, the
Person in question is the Beneficial Owner of fifteen percent or more
of the outstanding stock of the Company entitled to vote in the
election of directors of the Company (calculated as provided in
paragraph (d) of Rule 13d-3 under the Act in the case of rights to
acquire stock);

(iii) any merger, consolidation, recapitalization or reorganization
of the Company approved by the stockholders of the Company shall be
consummated, other than any such transaction immediately following
which the persons who were the Beneficial Owners of the outstanding
securities of the Company entitled to vote in the election of
directors of the Company immediately prior to such

14

 

transaction are the Beneficial Owners of at least 55% of the total
voting power represented by the securities of the entity surviving
such transaction entitled to vote in the election of directors of
such entity (or the ultimate parent of such entity) in substantially
the same relative proportions as their ownership of the securities of
the Company entitled to vote in the election of directors of the
Company immediately prior to such transaction; provided that, such
continuity of ownership (and preservation of relative voting power)
shall be deemed to be satisfied if the failure to meet such threshold
(or to preserve such relative voting power) is due solely to the
acquisition of voting securities by an employee benefit plan of the
Company, such surviving entity or any subsidiary of such surviving
entity;

(iv) any sale, lease, exchange or other transfer (in one transaction
or a series of related transactions) of all or substantially all the
assets of the Company approved by the stockholders of the Company
shall be consummated; or

(v) within any 24 month period, the persons who were directors of the
Company immediately before the beginning of such period (the
“Incumbent Directors”) shall cease (for any reason other than death)
to constitute at least a majority of the Board or the board of
directors of any successor to the Company, provided that any director
who was not a director at the beginning of such period shall be
deemed to be an Incumbent Director if such director (A) was elected
to the Board by, or on the recommendation of or with the approval of,
at least two-thirds of the directors who then qualified as Incumbent
Directors either actually or by prior operation of this clause (v),
and (B) was not designated by a person who has entered into an
agreement with the Company to effect a transaction described in
clause (iii) or (iv) of this definition of the term Change of Control
in Section 6(d) of this Agreement.

“Date of Termination” means (i) in the case of a termination of the
Employment Period for which a Notice of Termination is required, the date of
receipt of such Notice of Termination or, if later, the date specified
therein, as the case may be, or (ii) in all other cases, the actual date on
which Executive’s employment terminates during the Employment Period.

“Effective Date” means the earlier of: (i) the date on which a Potential
Change of Control occurs, or (ii) the date on which a Change of Control
occurs.

“Not Payable” means that a particular benefit shall not be paid or otherwise
provided to Executive.

“Notice of Termination” means (i) in the case of a Termination For Cause, a
written notice given by the Company to Executive, within 30 calendar days of
the Company’s having actual knowledge of the events giving rise to such
termination, (ii) in the case of a Termination Without Cause, a written
notice given by the Company to Executive at least 30 calendar days before
the effective date of such Termination Without Cause, (iii) in the

15

 

case of a Voluntary Termination Within 180 Days or a Voluntary Termination
After 180 Days, a written notice given by Executive to the Company at least
30 calendar days before the effective date of such termination, and (iv) in
the case of a Termination For Good Reason, a written notice given by
Executive to the Company within 180 days of Executive’s having actual
knowledge of the events giving rise to such Termination For Good Reason, and
which (A) indicates the specific termination provision in this Agreement
relied upon, (B) sets forth in reasonable detail the facts and circumstances
claimed to provide a basis for termination of the Executive’s employment
under the provision so indicated, and (C) if the termination date is other
than the date of receipt of such notice, specifies the termination date of
this Agreement (which date shall be not more than 15 days after the giving
of such notice). The failure by Executive to set forth in such Notice of
Termination any fact or circumstance that contributes to a showing of Good
Reason shall not waive any right of Executive hereunder or preclude
Executive from asserting such fact or circumstance in enforcing his rights
hereunder.

“Payable” means that a particular benefit shall be paid to Executive in the
amount, at the time, and in the form specified herein.

“Person” has the meaning ascribed to such term in Section 3(a)(9) of the
Act, as supplemented by Section 13(d)(3) of the Act; provided, however, that
Person shall not include (i) the Company, any subsidiary of the Company or
any other Person controlled by the Company, (ii) any trustee or other
fiduciary holding securities under any employee benefit plan of the Company
or of any subsidiary of the Company, or (iii) a corporation owned, directly
or indirectly, by the stockholders of the Company in substantially the same
proportions as their ownership of securities of the Company.

“Potential Change of Control” means:

(i) a Person shall commence a tender offer, which if successfully
consummated, would result in such Person being the Beneficial Owner
of at least 15% of the stock of the Company entitled to vote in the
election of directors of the Company;

(ii) the Company shall enter into an agreement the consummation of
which shall constitute a Change of Control of the Company;

(iii) solicitation of proxies for the election of directors of the
Company by anyone other than the Company, which, if such directors
were elected, would result in the occurrence of a Change of Control described in
Section 6(d) of this Agreement; or

(iv) any other event shall occur which is deemed to be a Potential
Change of Control by the Board or the appropriate Committee thereof.

“Severance Payment” means a cash amount equal to three times the sum of (i)
Executive’s Base Salary at the rate in effect as of the date on which the
Employment Period terminates, and (ii) Executive’s Target Bonus for such
year.

16

 

“Termination For Cause” means the Company’s termination of Executive’s
employment due to (i) Executive’s conviction of a felony; (ii) an act or
acts of extreme dishonesty or gross misconduct on Executive’s part which
result or are intended to result in material damage to the Company’s
business or reputation; or (iii) repeated material violations by Executive
of his obligations under Section 2 of this Agreement, which violations are
demonstrably willful and deliberate on Executive’s part and which result in
material damage to the Company’s business or reputation. Executive shall be
permitted to respond and defend himself before the Board within 30 days
after delivery to Executive of written notification of any proposed
Termination for Cause which specifies in detail the reasons for such
termination. If the majority of the members of the Board (excluding
Executive) do not confirm that the Company had grounds for a Termination For
Cause within 30 days after Executive has had his hearing before the Board,
Executive shall have the option of treating his employment as not having
terminated or as having been terminated pursuant to a Termination Without
Cause.

“Termination For Good Reason” means the occurrence of any of the following
after the occurrence of a Potential Change of Control or a Change of
Control:

(i) (A) the assignment to Executive of any duties inconsistent in any
material adverse respect with Executive’s position, duties, authority
or responsibilities as contemplated by Section 2 of this Agreement,
or (B) any other material adverse change in such position, including
titles, authority or responsibilities;

(ii) any failure by the Company to comply with any of the provisions
of Sections 3 and 4 of this Agreement at a level at least equal to
that in effect immediately preceding the Change of Control or a
Potential Change of Control, other than an insubstantial or
inadvertent failure remedied by the Company promptly after receipt of
notice thereof given by Executive;

(iii) the Company’s requiring Executive to be based at any office or
location more than 25 miles from the location at which he performed
his services specified under Section 2 hereof immediately prior to
the Change of Control or a Potential Change of Control, except for
travel reasonably required in the performance of Executive’s
responsibilities;

(iv) any failure by the Company to obtain the assumption and
agreement to perform this Agreement by a successor as contemplated by
Section 10(d) hereof; or

(v) any attempt by the Company to terminate the Executive’s
employment in a Termination For Cause that is determined by the Board
pursuant to Section 5 or 6 hereof, or in a proceeding pursuant to
Section 9 or Section 10 hereof, not to constitute a Termination For
Cause.

17

 

Notwithstanding the foregoing, a termination of Executive’s employment shall
not be treated as a Termination For Good Reason (I) if Executive shall have
consented in writing to the occurrence of the event giving rise to the claim
of Termination For
Good Reason, or (II) if Executive shall have delivered a Notice of
Termination to the Company, and the facts and circumstances specified
therein as providing a basis for such Termination For Good Reason are cured
by the Company within 10 days of its receipt of such Notice of Termination.

“Vested Benefits Enhancement” means (i) a cash amount equal to the present
value, calculated using a discount rate equal to the then prevailing
applicable Federal rate as determined under Section 1274(d) of the Internal
Revenue Code of 1986, as amended (the “Code”), of the additional retirement
benefits that would have been payable or available to Executive under any
ERPs, based on (A) the age and service Executive would have attained or
completed had Executive continued in the Company’s employ until the third
anniversary of the occurrence of the Change of Control, and (B) where
compensation is a relevant factor, his pensionable compensation as of the
Date of Termination, such compensation to include, on the same terms as
apply to other executives, any Severance Payment made to Executive, (ii)
solely for purposes of vesting in any benefits under any ESPs, Executive
shall be treated as having continued in the Company’s employ until the third
anniversary of the occurrence of such Change of Control, and (iii) solely
for purposes of determining eligibility for retiree medical benefits under
any retirement plan or any retiree welfare benefit plan, policy or program
of the Company or its affiliates, and any ERPs related thereto, Executive
shall be treated as having continued in the Company’s employ until the third
anniversary of the occurrence of such Change of Control and to have retired
on the last day of such period.

“Voluntary Termination Within 180 Days” means a termination of employment by
Executive for any reason within the first 180 days following a Change of
Control, and “Voluntary Termination After 180 Days” means a termination of
employment by Executive other than a Termination For Good Reason, a
Termination Due to Disability by Executive, or a Termination Due to Death
within the remaining 2 years and 6 months following a Change of Control.

“Welfare Benefits Continuation” shall have the same meaning as that
described in Section 5 hereof, except that the entitlement of Executive
and/or his dependents to participation in the Welfare Benefit Plans shall
continue until the third anniversary of the Date of Termination.

(e) Out-Placement Services. If the Employment Period terminates because of a
Termination Without Cause or a Termination For Good Reason, Executive shall be
entitled to out-placement services, provided by the Company or its designee at
the Company’s expense, for 12 months following the Date of Termination, or such
lesser period as the Executive may require such services.

(f) Certain Further Payments by Company.

18

 

(i) Tax Reimbursement Payment. In the event that any amount or benefit
paid or distributed to Executive pursuant to this Agreement, taken together
with any amounts or benefits otherwise paid or distributed to Executive by
the Company or any affiliate, including amounts attributable to the vesting
of stock options and restricted stock and the exercise of stock options
(collectively, the “Covered Payments”), are or become subject to the tax
(the “Excise Tax”) imposed under Section 4999 of the Internal Revenue Code
of 1986, as amended, or any similar tax that may hereafter be imposed, the
Company shall pay to the Executive at the time specified in this Section an
additional amount (the “Tax Reimbursement Payment”) such that the net amount
retained by the Executive with respect to such Covered Payments, after
deduction of any Excise Tax on the Covered Payments and any Federal, state
and local income tax and other tax on the Tax Reimbursement Payment provided
for by this Section, but before deduction for any Federal, state or local
income or employment tax withholding on such Covered Payments, shall be
equal to the amount of the Covered Payments.

(ii) Applicable Rules. For purposes of determining whether any of the
Covered Payments will be subject to the Excise Tax and the amount of such
Excise Tax,

(A) such Covered Payments will be treated as “parachute payments”
within the meaning of Section 280G of the Code, and all “parachute
payments” in excess of the “base amount” (as defined under Section
280G(b)(3) of the Code) shall be treated as subject to the Excise
Tax, unless, and except to the extent that, in the good faith
judgment of the Company’s independent certified public accountants
appointed prior to the Effective Date or tax counsel selected by such
accountants (the “Accountants”), the Company has a reasonable basis
to conclude that such Covered Payments (in whole or in part) either
do not constitute “parachute payments” or represent reasonable
compensation for personal services actually rendered (within the
meaning of Section 280G(b)(4)(B) of the Code) in excess of the “base
amount,” or such “parachute payments” are otherwise not subject to
such Excise Tax, and

(B) the value of any non-cash benefits or any deferred payment or
benefit shall be determined by the Accountants in accordance with the
principles of Section 280G of the Code.

(iii) Additional Rules. For purposes of determining the amount of the Tax
Reimbursement Payment, the Executive shall be deemed to pay: (A) Federal
income taxes at the highest applicable marginal rate of Federal income
taxation for the calendar year in which the Tax Reimbursement Payment is to
be made, and (B) any applicable state and local income and other taxes at
the highest applicable marginal rate of taxation for the calendar year in
which the Tax Reimbursement Payment is to be made, net of the maximum
reduction in Federal incomes taxes which could be obtained from the
deduction of such state or local taxes if paid in such year.

(iv) Repayment or Additional Payment in Certain Circumstances.

19

 

(A) Repayment. In the event that the Excise Tax is subsequently
determined by the Accountants or pursuant to any proceeding or
negotiations with the Internal Revenue Service to be less than the
amount taken into account hereunder in calculating the Tax
Reimbursement Payment made, Executive shall repay to the Company, at
the time that the amount of such reduction in the Excise Tax is
finally determined, the portion of such prior Tax Reimbursement
Payment that would not have been paid if such lesser Excise Tax had
been applied in initially calculating such Tax Reimbursement Payment.
Notwithstanding the foregoing, in the event any portion of the Tax
Reimbursement Payment to be repaid to the Company has been paid to
any Federal, state or local tax authority, repayment thereof shall
not be required unless and until actual refund or credit of such
portion has been made to Executive by the applicable tax authority.
Executive and the Company shall mutually agree upon the course of
action (if any) to be pursued in further pursuing such refund or
credit, if Executive’s good faith claim for refund or credit is
denied.

(B) Additional Tax Reimbursement Payment. In the event that the
Excise Tax is later determined by the Accountants or pursuant to any
proceeding or negotiations with the Internal Revenue Service to
exceed the amount taken into account hereunder at the time the Tax
Reimbursement Payment is made (including, but not limited to, by
reason of any payment the existence or amount of which cannot be
determined at the time of the Tax Reimbursement Payment), the Company
shall make an additional Tax Reimbursement Payment in respect of such
excess (plus any interest or penalty payable with respect to such
excess) at the time that the amount of such excess is finally
determined.

(v) Timing for Tax Reimbursement Payment. The Tax Reimbursement Payment
(or portion thereof) provided for in this Section 6 shall be paid to
Executive not later than 10 business days following the payment of the
Covered Payments; provided, however, that if the amount of such Tax
Reimbursement Payment (or portion thereof) cannot be finally determined on
or before the date on which payment is due, the Company shall pay to
Executive by such date an amount estimated in good faith by the Accountants
to be the minimum amount of such Tax Reimbursement Payment and shall pay the
remainder of such Tax Reimbursement Payment (together with interest at the
rate provided in Section 1274(b)(2)(B) of the Code) as soon as the amount
thereof can be determined, but in no event later than 45 calendar days after
payment of the related Covered Payment. To the extent that the amount of
the estimated Tax Reimbursement Payment exceeds the amount subsequently
determined to have been due, Executive shall repay such excess to the
Company on the fifth business day after written demand by the Company for
payment.

20

 

7. Timing of Payments.

Accrued Salary, Severance Payments and Vested Benefits Enhancements shall be
paid no later than 10 days following the termination of the Employment Period.
Pro-Rata Target Bonus shall be paid as follows: (a) if the Employment Period
terminates in the first, second or third calendar quarter of any particular
calendar year, then the Pro-Rata Target Bonus shall be paid no later than 10
days following the termination of the Employment Period; or (b) if the
Employment Period terminates in the fourth calendar quarter of any particular
calendar year, then the Pro-Rata Target Bonus shall be paid no later than the
same time as similar awards are paid to other executives participating in the
plans or programs under which the awards are paid, but in no event later than
March 31 of the calendar year following the end of such fourth calendar
quarter. Vested Benefits and Equity Awards shall be paid no later than the time
for payment Determined Under the Applicable Plan except as otherwise expressly
superseded or modified by this Agreement. Tax Reimbursement Payments shall be
paid at the time specified in Section 6 hereof. Notwithstanding the foregoing,
solely for purposes of amounts payable pursuant to Section 5 hereof, if any
amount payable to Executive pursuant to Section 5 would be nondeductible by the
Company under Section 162(m) of the Code if paid in the year of Executive’s
termination, the Company shall have the option of paying such nondeductible
amount, with interest at the one-year treasury bill rate as in effect on the
date of such termination as reported in the Wall Street Journal, on the first
day of the second calendar quarter in the year following such termination.

8. Full Discharge of Company Obligations.

Except in the case of amounts payable to Executive in the event of a
termination of employment following a Potential Change of Control as described
in the first paragraph of Section 6, and except as expressly provided in the
last sentence of this Section 8, the amounts payable to Executive pursuant to
Section 5 following termination of his employment (including amounts payable
with respect to Vested Benefits) shall be in full and complete satisfaction of
Executive’s rights under Section 5 of this Agreement and any other claims he
may have in respect of his employment by the Company or any of its affiliates.
Such amounts shall constitute liquidated damages with respect to any and all
such rights and claims and, upon Executive’s receipt of such amounts, the
Company shall be released and discharged from any and all liability to
Executive in connection with Section 5 of this Agreement or otherwise in
connection with Executive’s employment with the Company and its affiliates. In
no event shall Executive be obligated to seek other employment or take any
action by way of mitigation of the amounts payable to Executive under any of
the provisions of this Agreement and such amounts shall not be reduced whether
or not Executive obtains other employment. Nothing in this Section 8 shall be
construed to release the Company from its obligation to indemnify Executive as
provided in Section 4(e) hereof.

9. Noncompetition, Confidentiality and Other Covenants.

By and in consideration of the compensation and benefits to be provided by the
Company hereunder, including the severance arrangements set forth herein,
Executive agrees to the following:

21

 

(a) Noncompetition. During the Employment Period and until the earlier of:
(i) the last day of the one year period following any Voluntary Termination
of the Employment Period by Executive pursuant to Section 5 hereof, or (ii)
the date a Change of Control occurs (the “Restriction Period”), Executive
shall not become associated with any entity, whether as a principal,
partner, employee, agent, consultant, shareholder (other than as a holder,
or a member of a group which is a holder, of not in excess of 1% of the
outstanding voting shares of any publicly traded company) or in any other
relationship or capacity, paid or unpaid, that is actively engaged in any
geographic area in any business which is in competition with the business of
the Company. Notwithstanding anything herein to the contrary, the terms of
this Section 9(a) shall not apply in the event of any termination of
employment following a Change of Control as provided for in Section 6 of
this Agreement, including any termination following a Potential Change of
Control as described in the first paragraph of Section 6.

The Company shall, in its sole discretion, have the right to enforce or
waive the terms of this provision in connection with the Restriction Period.
If the Company exercises its right to enforce this provision for the
Restriction Period, the Company will provide Executive with written notice
of its intent to enforce such provision within fifteen (15) days following
the Company’s receipt of the Notice of Termination from Executive and the
Company agrees to pay Executive an amount equal to one year of Executive’s
then current Base Salary plus one year of Executive’s then current Target
Bonus as compensation for the Restriction Period. Such amount shall be paid
to Executive in equal monthly installments during the Restriction Period.
Executive agrees that the terms of the Restriction Period are reasonable and
that this compensation is above and beyond any amounts necessary to support
the terms of the Restriction Period as set forth herein.

(b) Confidentiality. Without the prior written consent of the Company,
except in the course of performing his duties hereunder and except to the
extent required by an order of a court having competent jurisdiction or
under subpoena from an appropriate government agency, Executive shall not
disclose to any third person, or permit the use of for the benefit of any
person or any entity other than the Company or its affiliates, any trade
secrets, customer lists, information regarding product development,
marketing plans, sales plans, management organization information (including
data and other information relating to members of the Board and management),
operating policies or manuals, business plans, financial records, or other
financial, organizational, commercial, business, sales, marketing,
technical, product or employee information relating to the Company or its
affiliates or information designated as confidential, proprietary, and/or a
trade secret, or any other information relating to the Company or its
affiliates that Executive knows from the circumstances, in good faith and
good conscience, should be treated as confidential, or any information that
the Company or its affiliates may receive belonging to customers, agents or
others who do business with the Company or its affiliates, except to the
extent that any such information previously has been disclosed to the public
by the Company or is in the public domain (other than by reason of
Executive’s violation of this Section 9(b)).

22

 

(c) Non-Solicitation of Employees. During the Employment Period and until
the earlier of: (i) the last day of the one year period following any
Voluntary Termination of the Employment Period by Executive pursuant to
Section 5 hereof, or (ii) the date a Change of Control occurs, Executive
shall not directly or indirectly solicit, encourage or induce any employee
of the Company or its affiliates to terminate employment with such entity,
and shall not directly or indirectly, either individually or as owner,
agent, employee, consultant or otherwise, employ or offer employment to any
person who is or was employed by the Company or an affiliate thereof unless
such person shall have ceased to be employed by such entity for a period of
at least six months. Notwithstanding anything herein to the contrary, the
terms of this Section 9(c) shall not apply in the event of any termination
of employment following a Change of Control as provided for in Section 6 of
this Agreement, including any termination following a Potential Change of
Control as described in the first paragraph of Section 6.

(d) Company Property. Except as expressly provided herein, promptly
following any termination of the Employment Period, Executive shall return
to the Company all property of the Company, and all copies thereof in
Executive’s possession or under his control.

(e) Injunctive Relief and Other Remedies with Respect to Covenants.
Executive acknowledges and agrees that the covenants and obligations of
Executive with respect to noncompetition, confidentiality, nonsolicitation,
and Company property relate to special, unique and extraordinary matters and
that a violation of any of the terms of such covenants and obligations will
cause the Company irreparable injury for which adequate remedies are not
available at law. Therefore, Executive agrees that the Company (i) shall be
entitled to an injunction, restraining order or such other equitable relief
(without the requirement to post bond) restraining Executive from committing
any violation of the covenants and obligations contained in this Section 9,
and (ii) shall have no further obligation to make any payments to Executive
hereunder following any material violation of the covenants and obligations
contained in this Section 9. These remedies are cumulative and are in
addition to any other rights and remedies the Company may have at law or in
equity. In connection with the foregoing provisions of this Section 9,
Executive represents that his economic means and circumstances are such that
such provisions will not prevent him from providing for himself and his
family on a basis satisfactory to him. Notwithstanding the foregoing, in no
event shall an asserted violation of the provisions of this Section
constitute a basis for deferring or withholding any amounts otherwise
payable to the Executive under this Agreement following a Change of Control.

10. Miscellaneous.

(a) Survival. All of the provisions of Sections 5 (relating to termination
of the Employment Period prior to a Change of Control), 6 (relating to
termination of the Employment Period following a Change of Control or a
Potential Change of Control), 9 (relating to noncompetition,
confidentiality, nonsolicitation and Company property),

23

 

10(b) (relating to arbitration), 10(c) (relating to legal fees) and 10(n)
(relating to governing law) of this Agreement shall survive the termination
of this Agreement.

(b) Arbitration. Except as provided in Section 9, any dispute or
controversy arising under or in connection with this Agreement shall be
resolved by binding arbitration. Such arbitration shall be held in the city
of Hartford, Connecticut and except to the extent inconsistent with this
Agreement, shall be conducted in accordance with the Commercial Arbitration
Rules of the American Arbitration Association in effect at the time of the
arbitration, and otherwise in accordance with the principles that would be
applied by a court of law or equity. The arbitrator shall be acceptable to
both the Company and Executive. If the parties cannot agree on an
acceptable arbitrator, the dispute or controversy shall be heard by a panel
of three arbitrators; one appointed by each of the parties and the third
appointed by the other two arbitrators. The Company and Executive further
agree that they will abide by and perform any award or awards rendered by
the arbitrators and that a judgment may be entered on any award or awards
rendered by any state or federal court having jurisdiction over the Company
or Executive or any of their respective property.

(c) Legal Fees and Expenses. In any contest (whether initiated by
Executive or by the Company) as to the validity, enforceability or
interpretation of any provision of this Agreement, the Company shall pay
Executive’s legal expenses (or cause such expenses to be paid) including,
without limitation, his reasonable attorney’s fees, on a quarterly basis,
upon presentation of proof of such expenses in a form acceptable to the
Company, provided that Executive shall reimburse the Company for such
amounts, plus simple interest thereon at the 90-day United States Treasury
Bill rate as in effect from time to time, compounded annually, if Executive
shall not prevail, in whole or in part, as to any material issue as to the
validity, enforceability or interpretation of any provision of this
Agreement.

(d) Successors; Binding Effect. This Agreement shall inure to the benefit
of and be binding upon the Company and its successors. The Company shall
require any successor to all or substantially all of the business and/or
assets of the Company, whether direct or indirect, by purchase, merger,
consolidation, acquisition of stock, or otherwise, by an agreement in form
and substance satisfactory to Executive, expressly to assume and agree to
perform this Agreement in the same manner and to the same extent as the
Company would be required to perform this Agreement if no such succession
had taken place. This Agreement is personal to the Executive and, without
the prior written consent of the Company, shall not be assignable by
Executive otherwise than by will or the law of descent and distribution.
This Agreement shall inure to the benefit of and be enforceable by
Executive’s legal representatives.

(e) Assignment. Except as provided in Section 10(d), neither this Agreement
nor any of the rights or obligations hereunder shall be assigned or
delegated by any party hereto without the prior written consent of the other
party.

24

 

(f) Entire Agreement. Exclusive of Executive’s offer letter dated April
23, 2001 (the “Offer Letter”), this Agreement constitutes the entire
agreement between the parties hereto with respect to the matters referred to
herein. This Agreement supersedes and replaces any prior employment or
severance agreement or arrangement between the Company and Executive. No
other agreement relating to the terms of Executive’s employment by the
Company, oral or otherwise, shall be binding between the parties unless it
is in writing and signed by the party against whom enforcement is sought.
There are no promises, representations, inducements or statements between
the parties other than those that are expressly contained herein and in the
Offer Letter. Executive acknowledges that he is entering into this
Agreement of his own free will and accord, and with no duress, and that he
has read this Agreement and that he understands it and its legal
consequences.

(g) Severability; Reformation. In the event that one or more of the
provisions of this Agreement shall become invalid, illegal or unenforceable
in any respect, the validity, legality and enforceability of the remaining
provisions contained herein shall not be affected thereby. In the event of
a determination that any of the provisions of Section 9(a), Section 9(b) or
Section 9(c) are not enforceable in accordance with their terms, Executive
and the Company agree that such Section shall be reformed to make such
Section enforceable in a manner that provides the Company the maximum rights
permitted at law.

(h) Waiver. Waiver by any party hereto of any breach or default by the
other party of any of the terms of this Agreement shall not operate as a
waiver of any other breach or default, whether similar to or different from
the breach or default waived. No waiver of any provision of this Agreement
shall be implied from any course of dealing between the parties hereto or
from any failure by either party hereto to assert its or his rights
hereunder on any occasion or series of occasions.

(i) Notices. Any notice required or desired to be delivered under this
Agreement shall be in writing and shall be delivered personally, by courier
service, by registered mail, return receipt requested, or by telecopy and
shall be effective upon actual receipt by the party to which such notice
shall be directed, and shall be addressed as follows (or to such other
address as the party entitled to notice shall hereafter designate in
accordance with the terms hereof):

	 	 	 
	If to the Company:

	 	The Hartford Financial Services Group, Inc.

Law Department, HO-1-09

Hartford Plaza

Hartford, CT 06115

Attention: Corporate Secretary

25

 

	 	 	 
	with a copy to:

	 	Debevoise & Plimpton

875 Third Avenue

New York, NY 10022

Attn: Lawrence K. Cagney, Esq.
	 
	 	 
	If to Executive:

	 	The home address of Executive 

shown on the records of the Company

(j) Amendments. This Agreement may not be altered, modified or amended
except by a written instrument signed by each of the parties hereto.

(k) Headings. Headings to provisions of this Agreement are for the
convenience of the parties only and are not intended to be part of or to
affect the meaning or interpretation hereof.

(l) Counterparts. This Agreement may be executed in counterparts, each of
which shall be deemed an original but all of which together shall constitute
one and the same instrument.

(m) Withholding. Any payments provided for herein shall be reduced by any
amounts required to be withheld by the Company from time to time under
applicable Federal, State or local income or employment tax laws or similar
statutes or other provisions of law then in effect.

(n) Governing Law. This Agreement shall be governed by the laws of the
State of Connecticut, without reference to principles of conflicts or choice
of law under which the law of any other jurisdiction would apply.

26

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