Document:

EX-10.1

 EXHIBIT 10.1 

FIFTH AMENDMENT TO 

THE PROGRESSIVE CORPORATION 

EXECUTIVE SEPARATION ALLOWANCE PLAN 

(2006 AMENDMENT AND RESTATEMENT) 

WHEREAS, The Progressive Corporation Executive Separation Allowance Plan (“Plan”) is currently maintained pursuant to
the 2006 Amendment and Restatement and four amendments thereto; and 
 WHEREAS, it is deemed desirable to amend the Plan
further; 
 NOW, THEREFORE, effective May 16, 2013, the Plan is hereby amended as set forth below: 

 

	 	1.	Section 2.1 of the Plan is hereby amended and restated in its entirety to provide as follows: 

“2.1 
 (a)
An Eligible Employee shall be entitled to receive a separation allowance under this Plan if (i) Progressive terminates his/her employment for reasons other than resignation (except as provided in Section 2.1(b) below), retirement, death,
disability (except as provided in Section 2.3 below), leave of absence or discharge for Cause, and (ii) the Eligible Employee signs a Separation Agreement and General Release and delivers it to the Company within forty-five (45) days
after the Eligible Employee’s Separation Date. 
 (b) An Eligible Employee shall be entitled to receive a separation
allowance under this Plan if (i) the Company gives the Eligible Employee written notice of a Job Change, (ii) the Eligible Employee delivers a written resignation from employment to the Company within such period as the Company shall
specify and which resignation is effective as of a date that (A) is acceptable to the Company and (B) is no later than January 10 of the calendar year immediately following the calendar year in which the Eligible Employee receives
from the Company the written notice of a Job Change pursuant to Section 2.1(b)(i) above, and (iii) the Eligible Employee signs a Separation Agreement and General Release and delivers it to the Company within forty-five (45) days after
the resignation effective date determined pursuant to Section 2.1(b)(ii) above.” 
  

	 	2.	Section 1.11 of the Plan is hereby amended and restated in its entirety to provide as follows: 

“1.11 

“Job Change” (a) for purposes of Section 2.2 means either (i) a decrease in the Total Pay Package of an Eligible
Employee’s current job, (ii) a transfer of an Eligible Employee to another job having a lesser Total Pay Package, or (iii) the imposition of significantly different job duties, shift, work location or number of

  
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scheduled work hours and (b) for purposes of Section 2.1(b) means any change in an Eligible Employee’s job duties that is deemed significant by the Company in its sole and absolute
discretion. No determination by the Company as to the significance of any such change shall be deemed a precedent or shall limit in any way the Company’s sole and absolute discretion in deciding whether any change in any Eligible
Employee’s job duties is significant.” 
  

	 	3.	Section 1.15 of the Plan is hereby amended and restated in its entirety to provide as follows: 

“Separation Date” means the effective date of any Eligible Employee’s termination of employment or resignation due to a
Job Change.” 
  

	 	4.	Section 1.4 of the Plan is hereby amended and restated in its entirety to provide as follows: 

“”Change in Control” means a change in the ownership of the of the Company, a change in effective control of
the Company, or a change in the ownership of a substantial portion of the Company’s assets, each as defined in, and determined in accordance with, Section 409A of the Code.” 

 

	 	5.	Section 4.1 of the Plan is hereby amended and restated in its entirety to provide as follows: 

“4.1 An Eligible Employee who resigns or whose employment has been terminated under the Plan may elect to continue his/her and
his/her dependents’ medical, dental and vision coverages, if any, under the Consolidated Omnibus Budget Reconciliation Act of 1985 (“COBRA”), as further provided in the Applicable Group Insurance Plan (to the extent he/she and his/her
dependents were receiving such coverages immediately prior to his/her Separation Date), for the period specified in the Applicable Group Insurance Plan and subject to the terms and conditions thereof. If an Eligible Employee who is entitled to a
separation allowance under the preceding provisions of this Plan elects to continue his/her and/or his/her dependents’ medical, dental and/or vision coverages under the Applicable Group Insurance Plan, the Eligible Employee will be entitled to
receive such coverages at the contribution amount set forth in the Applicable Group Insurance Plan (referred to therein as the “Separation Allowance Contribution”) for a period not to exceed the lesser of (i) the COBRA continued
coverage period or (ii) the number of weeks of Compensation used in computing the amount of his/her separation allowance under Section 3.1 above, provided that the Eligible Employee pays such Separation Allowance Contribution to the
Participating Employer at such times as the Participating Employer shall specify. Eligible Employees may also qualify for a reduction of the Separation Allowance Contribution under the American Recovery and Reinvestment Act of 2009.”

  

	 	6.	Section 3 of the Separation Agreement and General Release attached to the Plan as Exhibit A is hereby amended and restated in its entirety to provide as follows:

  
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 “3. Executive shall be entitled to continue his/her and his/her dependents’
medical, dental and vision coverages under the Consolidated Omnibus Budget Reconciliation Act of 1985 (“COBRA”), as further provided in The Progressive Health, Life and Disability Benefits Plan (“Group Insurance Plan”), for the
period specified in the Group Insurance Plan, subject to the terms, conditions and limitations of the Group Insurance Plan. If Executive elects to continue any such coverages, Executive will be entitled to receive such coverages at the contribution
amount set forth in the Group Insurance Plan (referred to therein as the “Separation Allowance Contribution”) for a period not to exceed the lesser of (i) the COBRA continued coverage period or (ii) the number of weeks used in
computing the amount of the Executive’s Separation Allowance under Section 1 above, provided that Executive pays such Separation Allowance Contribution to Employer at such times as Employer shall specify. Executive also shall be entitled
to the conversion privileges, if any, applicable to his/her life insurance and/or other coverages under the Group Insurance Plan.” 
  

	 	7.	Section 3.5 of the Plan is hereby amended and restated in its entirety to provide as follows: 

“Notwithstanding anything herein to the contrary, no separation allowance payments shall be made under this Plan to any Eligible
Employee later than two and one-half months following (i) the end of the year in which the Eligible Employee’s Separation Date occurs, or (ii) if earlier, the end of the year in which the Eligible Employee receives a written notice
from the Company pursuant to Section 2.1(b)(i) above.” 
  

	 	8.	The Separation Agreement and General Release attached to the Plan as Exhibit A is hereby replaced in its entirety by the document attached to this Amendment as Exhibit
A. 

 IN WITNESS WHEREOF, the Company has hereunto caused this Amendment to be executed by its duly authorized
representative as of the          day of                     , 2013. 

 

			
	THE PROGRESSIVE CORPORATION
		
	By:	 	 
		
	Title:	 	 

  
 -3-EX-10.1

 EXHIBIT 10.1 

 
 

 
 March 25, 2013 
 Paul J. Diaz 
 680 South Fourth Street 
 Louisville, KY 40202 
 Dear Paul: 

Kindred Healthcare, Inc. (the “Company”) is pleased to inform you that you are eligible to receive a cash bonus pursuant
to the Kindred Healthcare, Inc. 2013 Long-Term Incentive Plan (the “Plan”) on the terms and conditions set forth in this letter agreement. Capitalized terms used but not defined herein shall have the meaning provided in the Plan, a
copy of which is attached hereto as Exhibit A. 
  

	1.	Amount of Award and Performance Conditions. 

 a. Target Incentive Award. Your Target Incentive Award shall be up to $5,000,000, as set forth in the matrix below. 
 b. Performance Period. The Performance Period for your Award shall begin on December 31, 2012 and end on August 31, 2015. 

c. Performance Goal. The Performance Goal applicable to your Award shall be total shareholder return of the Company
(“TSR”) of 30% or $21.94, where TSR is measured by dividing (1) the sum of (x) the cumulative amount of dividends for the measurement period, assuming dividend reinvestment, and (y) the difference between the share
price at the end and the beginning of the measurement period; by (2) the share price at the beginning of the measurement period, and rounded to the nearest whole percentage point. The starting stock price for purposes of measuring TSR shall be
$10.82, the closing price of a share of Company common stock on December 31, 2012, and the ending stock price shall be the average closing price of a share of Company common stock during normal trading hours on the New York Stock Exchange for
the sixty (60) consecutive trading days ending on August 31, 2015. 
  

					
	 Annualized Total Shareholder Return During
 the Performance Period/
 Corresponding Ending
Stock Price
	  	Amount of Award	 
	 30% or $21.94 (and above)
	  	$	5,000,000	  
	 25% or $19.72
	  	$	4,000,000	  
	 20% or $17.66
	  	$	3,000,000	  
	 15% or $15.74
	  	$	2,000,000	  
	 7.5% or $13.13
	  	$	1,000,000	  
	 Below 7.5%
	  	$	0	  

 To the extent that the Company’s TSR falls between any two levels listed in the table
above, the amount of the Award will be determined based on linear interpolation between the two levels. The amount of the Award may not be greater than $5,000,000. 
 d. Calculation of Award. The Compensation Committee of the board of directors of the Company (the “Committee”) shall determine the amount of the Award payable to you in accordance
with the terms of the Plan. Such determination shall be made as soon as practicable following August 31, 2015, and in any event within ninety (90) days of such date. Subject Section 6(b) of the Plan relating to the deferral of
payments made to a “specified employee” as defined in Section 409A of the Code, your Award will be paid to you in a lump sum in cash on the next regularly occurring payroll date following the certification of your Award. 

2. Termination of Employment. 
 a. Termination without Cause. In the event of the termination of your employment during the Performance Period by the Company without Cause, or as a result of your resignation for Good Reason, as
that term is defined in your employment agreement with the Company dated May 17, 2012, the Award will remain outstanding and subject to calculation at the end of the Performance Period, as described in Section 1 above. 

b. Termination due to death or Disability. In the event of your death or Disability (as defined in the Plan) during the
Performance Period, you (or your beneficiary) shall be entitled to receive an Award calculated based on TSR for the period beginning on December 31, 2012, and ending on the date of such death or Disability, where the ending stock price shall be
the average closing price of a share of Company common stock during normal trading hours on the New York Stock Exchange for the sixty (60) consecutive trading days ending on the date of such death or Disability. Such Award shall be paid as soon
as administratively feasible (but in no event later than thirty (30) days) after the date of your death or Disability, in a lump sum in cash. 
 c. Termination for any other reason. In the event of the termination of your employment during the Performance Period for any other reason, the Award will be forfeited. 

3. Change in Control. 

In the event of a Change in Control during the Performance Period, you shall be entitled to receive an Award calculated based on TSR for
the period beginning on December 31, 2012, and ending on the date of such Change in Control, where the ending stock price shall be the average closing price of a share of Company common stock during normal trading hours on the New York Stock
Exchange for the sixty (60) consecutive trading days ending on the date of such Change in Control. Such Award shall be paid as soon as administratively feasible (but in no event later than thirty (30) days) after the date of such Change in
Control, in a lump sum in cash. 
 4. Restrictive Covenants. 
 a. Non-Competition. 
 i. In consideration for your Award
pursuant to this letter agreement, during the period beginning on the date of termination of your employment and ending one (1) year thereafter (the “Non-Compete Period”), you shall not directly or indirectly,

  
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without prior written approval of the Company’s board of directors, become an officer, employee, agent, partner, or director of, or provide any services or advice to or for, or be a lender
to or for, any business enterprise in “Substantial Direct Competition” (as defined below) with the Company. The above constraint shall not prevent you from making passive investments, not to exceed five percent (5%) of the total
equity value, in any enterprise where your services or advice is not required or provided. For purposes of this Section 4, a lender includes private equity firms but does not include real estate investment trusts or other financial institutions
that provide financing in the ordinary course of business. 
 ii. For purposes of this Section 4, a business
enterprise with which you become associated as an officer, employee, agent, partner, or director shall be considered in “Substantial Direct Competition” with the Company if such entity owns, operates or manages long-term acute care
hospitals, nursing facilities, inpatient rehabilitation hospitals, or provides contract rehabilitation therapy services, home health services or hospice services within any state where the Company or any of its direct or indirect subsidiaries or
affiliates has operations as of the date of termination of your employment. 
 iii. During the Non-Compete
Period, you shall not, without prior written approval of the Company’s board of directors, directly or indirectly, solicit, provide to, take away, or attempt to take away or provide to any customer or solicited prospect of the Company or any of
its direct or indirect subsidiaries any business of a type which the Company or such subsidiary provides or markets or which is competitive with any business then engaged in (or product or services marketed or planned to be marketed) by the Company
or any of its direct or indirect subsidiaries; or induce or attempt to induce any such customer to reduce such customer’s business with that business entity, or divert any such customer’s business from the Company and its direct or
indirect subsidiaries; or discuss that subject with any such customer. 
 b. Non-Solicit. In consideration for your Award
pursuant to this letter agreement, for a period of one year following the date of the termination of your employment (the “Restricted Period”), you agree not to directly or indirectly, individually or on behalf of any Person (as
defined below) other than the Company, aid or endeavor to solicit or induce any of the Company’s or its affiliates’ employees to leave their employment with the Company or such affiliates in order to accept employment with you or any other
Person; provided, however, that the foregoing shall not restrict you or any other Person from conducting general solicitations or advertisements not directed specifically at employees of the Company or its affiliates, or from employing
any employee who responds to any such general solicitation or advertisement or who otherwise initiates a request for employment (the “Non-Solicitation Covenant”). For purposes of this letter agreement, the term
“Person” shall mean any individual, partnership, corporation, limited liability company, unincorporated organization, trust or joint venture, or a governmental agency or political subdivision thereof. 

c. Provisions Relating To Non-Competition and Non-Solicitation. In the event that you violate either of the Non-Solicitation
Covenant or the Non-Competition Covenant, (i) you shall forfeit all rights to receive the Award, to the extent not already paid, and (ii) the Company shall have the right to recoup the entire amount of the Award, if any, already paid to
you pursuant to this letter agreement. To the extent that any covenant set forth in this Section 4 shall 

  
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be determined to be invalid or unenforceable in any respect or to any extent, the covenant shall not be void or rendered invalid, but instead shall be automatically amended for such lesser term,
to such lesser extent, or in such other lesser degree, as will grant the Company the maximum protection and restrictions on the Executive’s activities permitted by applicable law in such circumstances. The Company shall have the right to
injunctive relief to restrain any breach or threatened breach of any provisions in this Section 4 in addition to and not in lieu of any rights to recover damages or cease making payments under this letter agreement. The Company shall have the
right to advise any of your prospective or then-current employers of the provisions of this letter agreement without liability. The Company’s right to enforce the provisions of this letter agreement shall not be affected by the existence, or
non-existence, of any other similar agreement for any other executive, or by the Company’s failure to exercise any of its rights under this letter agreement or any other similar agreement or to have in effect a similar agreement for any other
employee. The provisions of this Section 4 shall survive the termination of your employment and this letter agreement. 
 5. Shareholder
Approval Required. As an Award granted pursuant to the Plan, this Award shall not become effective until the Plan has been approved by the shareholders of the Company. In the event that the shareholders of the Company do not vote to approve the
Plan at the 2013 annual shareholders meeting, this Award shall be void ab initio and you shall have no further rights hereunder. 
 6.
Construction of Agreement. Any provision of this letter agreement (or portion thereof) which is deemed invalid, illegal or unenforceable in any jurisdiction shall, as to that jurisdiction and subject to this section, be ineffective to the extent
of such invalidity, illegality or unenforceability, without affecting in any way the remaining provisions thereof in such jurisdiction or rendering that or any other provisions of this letter agreement invalid, illegal, or unenforceable in any other
jurisdiction. No waiver of any provision or violation of this letter agreement by the Company shall be implied by the Company’s forbearance or failure to take action. 
 7. Delays or Omissions. No delay or omission to exercise any right, power or remedy accruing to any party hereto upon any breach or default of any party under this letter agreement, shall impair
any such right, power or remedy of such party nor shall it be construed to be a waiver of any such breach or default, or an acquiescence therein, or of or in any similar breach or default thereafter occurring nor shall any waiver of any single
breach or default be deemed a waiver of any other breach or default theretofore or thereafter occurring. Any waiver, permit, consent or approval of any kind or character on the part of any party of any breach or default under this letter agreement,
or any waiver on the part of any party or any provisions or conditions of this letter agreement, shall be in writing and shall be effective only to the extent specifically set forth in such writing. 

8. Conflict of Terms. This Award is granted pursuant to and is subject to the terms and conditions of the Plan. In the event of a direct conflict
between the terms of this letter agreement and the Plan, the terms of this letter agreement shall govern. 
 9. Integration. This letter
agreement and the Plan contain the entire understanding of the parties with respect to its subject matter. There are no restrictions, agreements, promises, representations, warranties, covenants or undertakings with respect to the subject matter
hereof other than those expressly set forth herein and in the Plan. This letter agreement, including without limitation the Plan, supersedes all prior agreements and understandings between the parties with respect to its subject matter. 

  
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 10. Counterparts. This letter agreement may be executed in two or more counterparts, each of which
shall be deemed an original, but all of which shall constitute one and the same instrument. 
 11. Participant Acknowledgment. You hereby
acknowledge receipt of a copy of the Plan. You hereby acknowledge that all decisions, determinations and interpretations of the Committee in respect of the Plan, this letter agreement shall be final and conclusive. 

 

			
	Sincerely,
	
	Kindred Healthcare, Inc.
		
	By:	 	 /s/ Richard A. Lechleiter

		 	Richard A. Lechleiter
		 	Executive Vice President and
		 	Chief Financial Officer

 Acknowledged and Agreed on this 
 25th day of March, 2013 
  

	
	 /s/ Paul J. Diaz

	Paul J. Diaz

  
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