Document:

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                                                                   Exhibit 10.78

                 [TIER II CHANGE IN CONTROL SEVERANCE AGREEMENT]

                               SCPIE HOLDINGS INC.
                        1888 Century Park East, Suite 800
                          Los Angeles, California 90067

                                December __, 2000

[Executive]
c/o SCPIE Management Company
1888 Century Park East, Suite 800
Los Angeles, California 90067

Dear [Executive]:

          SCPIE Holdings Inc. (the "Corporation") considers it essential to the
best interests of its shareholders to foster the continuous employment of key
management personnel. In connection with this, the Corporation's Board of
Directors (the "Board") recognizes that, as is the case with many publicly held
corporations, the possibility of a change in control of the Corporation may
exist and that the uncertainty and questions that it may raise among management
could result in the departure or distraction of management personnel to the
detriment of the Corporation and its shareholders.

          The Board has decided to reinforce and encourage the continued
attention and dedication of members of the Corporation's management, including
yourself, to their assigned duties without the distraction arising from the
possibility of a change in control of the Corporation.

          In order to induce you to remain in the employ of the Corporation or
any of its affiliates (collectively, the "Company"), the Corporation hereby
agrees that after this letter agreement (this "Agreement") has been fully
executed, you shall receive the severance benefits set forth in Section 5 of
this Agreement in the event your employment with the Company is terminated under
the circumstances described in Section 4 of this Agreement subsequent to a
Change in Control (as defined in Section 2).

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          1.   Term of Agreement. This Agreement shall commence on the date
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hereof and shall continue in effect through December 31, 2003; provided,
however, that commencing on January 1, 2001 and on each January 1 thereafter,
the term of this Agreement shall automatically be extended for one additional
year unless, not later than September 30 of the preceding year, the Corporation
shall have given notice that it does not wish to extend this Agreement;
provided, further, that if a Change in Control (as defined in Section 2), occurs
during the original or any extended term of this Agreement, the term of this
Agreement shall continue in effect for a period of not less than thirty-six (36)
months beyond the month in which such Change in Control occurred.

          2.   Change in Control.
               -----------------

          No benefits shall be payable under Section 4 of this Agreement unless
there has been a Change in Control. For purposes of this Agreement, a Change in
Control shall be deemed to occur if:

          (a)  any Person (as defined in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934, as amended (the "Exchange Act")) is or becomes
the Beneficial Owner (as defined in Rule 13d-3 under the Exchange Act), directly
or indirectly, of securities of the Corporation representing 20% or more of the
combined voting power of the Corporation's then outstanding securities
("Outstanding Corporation Voting Securities"); provided, however, that for
purposes of this subsection (a), the following shall not constitute a Change in
Control: (i) any acquisition by the Corporation or any corporation controlled by
the Corporation, (ii) any acquisition by any employee benefit plan (or related
trust) sponsored or maintained by the Corporation or any corporation controlled
by the Corporation, or (iii) any acquisition by a Person of 20% of the
Outstanding Corporation Voting Securities as a result of an acquisition of
common stock of the Corporation by the Corporation which, by reducing the number
of shares of common stock of the Corporation outstanding, increases the
proportionate number of shares beneficially owned by such Person to 20% or more
of the Outstanding Corporation Voting Securities; provided, however, that if a
Person shall become the beneficial owner of 20% or more of the Outstanding
Corporation Voting Securities by reason of a share acquisition by the
Corporation as described above and shall, after such share acquisition by the
Corporation, become the beneficial owner of any additional shares of common
stock of the Corporation, then such acquisition shall constitute a Change in
Control;

          (b)  during any period of two consecutive years (not including any
period prior to the execution of this Agreement), individuals who at the
beginning of such period constitute the Board, and any new director (other than
a director designated by a person who has entered into an agreement with
Corporation to effect a transaction described in Sections 2(a), (c), (d) or (e))
whose election by the Board or nomination for election by the Corporation's
stockholders was approved by a vote of at least two-thirds (2/3) of the
directors then still in office who either were directors at the beginning of the
period or whose election or nomination for election was

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previously so approved (hereinafter referred to as "Continuing Directors"),
cease for any reason to constitute at least a majority thereof;

          (c)  the consummation by the Corporation of a merger or consolidation
of Corporation with any other corporation (or other entity), other than a merger
or consolidation which would result in the voting securities of the Corporation
outstanding immediately prior thereto continuing to represent (either by
remaining outstanding or by being converted into voting securities of the
surviving entity) 50% or more of the combined voting power of the voting
securities of the Corporation or such surviving entity outstanding immediately
after such merger or consolidation; provided, however, that a merger or
consolidation effected to implement a recapitalization of the Corporation (or
similar transaction) in which no Person acquires more than 20% of the
Outstanding Corporation Voting Securities shall not constitute a Change in
Control;

          (d)  the stockholders of the Corporation approve a plan of complete
liquidation of the Corporation; or

          (e)  the consummation of an agreement (or agreements) providing for
the sale or disposition by the Corporation of all or substantially all of the
Corporation's assets other than a sale or disposition which would result in the
voting securities of the Corporation outstanding immediately prior thereto
continuing to represent 50% or more of the combined voting power of the
Corporation or such surviving entity outstanding immediately after such sale or
disposition.

          3.   Accelerated Vesting Upon a Change in Control.
               --------------------------------------------

          Notwithstanding any provisions of the Company's stock option plans,
incentive plans, or other similar plans, all outstanding options ("Options"), if
any, granted to you under any of the Company's stock option plans, incentive
plans, or other similar plans (or options substituted therefor covering the
stock of a successor corporation) shall become fully vested and exercisable
immediately prior to the Change in Control as to all shares of stock covered
thereby, and the restricted period with respect to any restricted stock or any
other equity award granted to you thereunder shall lapse and such shares shall
be distributed to you immediately prior to the Change in Control, unless it
would adversely affect the Corporation's ability to use pooling of interest
accounting in a Change in Control transaction in which such accounting is
intended to be used.

          4.   Termination of Employment Following a Change in Control.
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          (a)  General. During the term of this Agreement, if any of the
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events described in Section 2 constituting a Change in Control shall have
occurred, you shall be entitled to the benefits provided in Section 5(c) upon
the subsequent termination of your employment, provided that such termination
occurs during the term of this Agreement and within the two (2) year period
immediately following the date of such Change in Control, unless such
termination is (i)

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because of your death or Disability (as defined in Section 4(b)), (ii) by the
Company for Cause (as defined in Section 4(c)), or (iii) by you other than (1)
for Good Reason (as defined in Section 4(d)), or (2) in a Covered Resignation
(as defined in Section 4(e)). In the event that you are entitled to such
benefits, such benefits shall be paid notwithstanding the subsequent expiration
of the term of this Agreement.

          (b)  Disability. If, as a result of your incapacity due to physical or
               ----------
mental illness, you shall have been absent from the full-time performance of
your duties with the Company for six (6) consecutive months, and within thirty
(30) days after written notice of termination is given you shall not have
returned to the full-time performance of your duties, your employment may be
terminated for "Disability."

          (c)  Cause. Termination by the Company of your employment for "Cause"
               -----
shall mean termination (i) upon your willful and continued failure to
substantially perform your duties with the Company (other than any such failure
resulting from your incapacity due to physical or mental illness or any such
actual or anticipated failure after your issuance of a Notice of Termination (as
defined in Section 4(f) for Good Reason), after a written demand for substantial
performance is delivered to you by the Board, which demand specifically
identifies the manner in which the Board believes that you have not
substantially performed your duties, (ii) upon your willful and continued
failure to substantially follow and comply with the specific and lawful
directives of the Board, as reasonably determined by the Board (other than any
such failure resulting from your incapacity due to physical or mental illness or
any such actual or anticipated failure after your issuance of a Notice of
Termination for Good Reason), after a written demand for substantial performance
is delivered to you by the Board, which demand specifically identifies the
manner in which the Board believes that you have not substantially performed
your duties, (iii) upon your willful commission of an act of fraud or dishonesty
resulting in material economic or financial injury to the Company, or (iv) upon
your willful engagement in illegal conduct or gross misconduct, in each case
which is materially and demonstrably injurious to the Company. For purposes of
this Section 4(c), no act, or failure to act, on your part shall be deemed
"willful" unless done, or omitted to be done, by you not in good faith.
Notwithstanding the foregoing, you shall not be deemed terminated for Cause
pursuant to Sections 4(c)(i), (ii) or (iv) hereof unless and until there shall
have been delivered to you a copy of a resolution duly adopted by the
affirmative vote of not less than three-quarters (3/4) of the entire membership
of the Board at a meeting of the Board (after reasonable notice to you, an
opportunity for you, together with your counsel, to be heard before the Board
and a reasonable opportunity to cure), finding that in the Board's good faith
opinion you were guilty of conduct set forth above in this Section 4(c) and
specifying the particulars thereof in reasonable detail.

          (d)  Good Reason. You shall be entitled to terminate your employment
               -----------
for Good Reason. For purposes of this Agreement, "Good Reason" shall mean,
without your express written consent, the occurrence after a Change in Control
of any of the following

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circumstances unless, in the case of Sections 4(d)(i), (v), (vi), or (vii), such
circumstances are fully corrected (provided such circumstances are capable of
correction) prior to the Date of Termination (as defined in Section 4(g))
specified in the Notice of Termination given in respect thereof:

               (i)    the assignment to you of any duties inconsistent with the
     position in the Company that you held immediately prior to the Change in
     Control, a significant adverse alteration in the nature or status of your
     responsibilities or the conditions of your employment from those in effect
     immediately prior to such Change in Control, or any other action by the
     Company that results in a material diminution in your position, authority,
     duties or responsibilities;

               (ii)   the Company's reduction by more than 10% of your annual
     total compensation as in effect on the date hereof or as the same may be
     increased from time to time;

               (iii)  the relocation of the Company's offices at which you are
     principally employed immediately prior to the date of the Change in Control
     (your "Principal Location") which results in the one-way commuting distance
     for you increasing by more than thirty (30) miles from such location, or
     the Company's requiring you, without your written consent, to be based
     anywhere other than your Principal Location, except for required travel on
     the Company's business to an extent substantially consistent with your
     present business travel obligations;

               (iv)   the Company's failure to pay to you any portion of your
     current compensation or to pay to you any portion of an installment of
     deferred compensation under any deferred compensation program of the
     Company within seven (7) days after the date such compensation is due;

               (v)    the Company's failure to continue in effect any material
     compensation or benefit plan in which you participate immediately prior to
     the Change in Control, unless an equitable arrangement (embodied in an
     ongoing substitute or alternative plan) has been made with respect to such
     plan, or the Company's failure to continue your participation therein (or
     in such substitute or alternative plan) on a basis not materially less
     favorable, both in terms of the amount of benefits provided and the level
     of your participation relative to other participants, as existed at the
     time of the Change in Control;

               (vi)   the Corporation's failure to obtain a satisfactory
     agreement from any successor to assume and agree to perform this Agreement,
     as contemplated in Section 6 hereof; or

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               (vii)  any purported termination of your employment that is not
     effected pursuant to a Notice of Termination satisfying the requirements of
     Section 4(f) hereof (and, if applicable, the requirements of Section 4(c)
     hereof), which purported termination shall not be effective for purposes of
     this Agreement.

Your right to terminate your employment pursuant to this Section 4(d) shall not
be affected by your incapacity due to physical or mental illness. Your continued
employment shall not constitute consent to, or a waiver of rights with respect
to, any circumstance constituting Good Reason hereunder. Any good faith
determination by you that Good Reason exists shall be presumed correct and shall
be binding upon the Corporation.

          (e)  Voluntary Termination and Covered Resignation. You shall be
               ---------------------------------------------
entitled to voluntarily terminate your employment for any reason or no reason at
any time after a Change in Control. Any such termination which occurs within the
thirty (30)-day period following the first anniversary of the occurrence of a
Change in Control (a "Covered Resignation") shall constitute a resignation which
entitles you to receive benefits under this Agreement.

          (f)  Notice of Termination. Any purported termination of your
               ---------------------
employment by the Company or by you (other than termination due to death which
shall terminate your employment automatically) shall be communicated by written
Notice of Termination to the other party hereto in accordance with Section 7.
"Notice of Termination" shall mean a notice that shall indicate the specific
termination provision in this Agreement relied upon and shall set forth in
reasonable detail the facts and circumstances claimed to provide a basis for
termination of your employment under the provision so indicated.

          (g)  Date of Termination, Etc. "Date of Termination" shall mean (a) if
               ------------------------
your employment is terminated due to your death, the date of your death; (b) if
your employment is terminated for Disability, thirty (30) days after Notice of
Termination is given (provided that you shall not have returned to the full-time
performance of your duties during such thirty (30)-day period), and (c) if your
employment is terminated pursuant to Section 4(c), Section 4(d) or Section 4(e)
or for any other reason (other than death or Disability), the date specified in
the Notice of Termination (which, in the case of a termination for Cause shall
not be less than thirty (30) days from the date such Notice of Termination is
given, and in the case of a termination for Good Reason or in connection with a
Covered Resignation shall not be less than fifteen (15) nor more than sixty (60)
days from the date such Notice of Termination is given).

          5.   Compensation Upon Termination or During Disability Following A
               --------------------------------------------------------------
               Change in Control.
               -----------------

          Following a Change in Control during the term of this Agreement, you
shall be entitled to the benefits described below during a period of disability,
or upon termination of your employment, as the case may be, provided that such
period or termination occurs during the term of this Agreement and within the
two (2) year period immediately following the date of such

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Change in Control. The benefits to which you are entitled, subject to the terms
and conditions of this Agreement, are:

          (a)  During any period during which you fail to perform your full-time
duties with the Company as a result of incapacity due to physical or mental
illness, you shall continue to receive your base salary at the rate in effect at
the commencement of any such period, together with all compensation payable to
you under the Company's disability plan or program or other similar plan during
such period, until this Agreement is terminated pursuant to Section 4(b) hereof.
Thereafter, or in the event your employment is terminated by reason of your
death, your benefits shall be determined under the Company's retirement,
insurance and other compensation programs then in effect in accordance with the
terms of such programs.

          (b)  If your employment shall be terminated (i) by the Company for
Cause or (ii) by you other than for Good Reason or pursuant to a Covered
Resignation, the Corporation shall pay you (1) your full base salary, when due,
through the Date of Termination at the rate in effect at the time Notice of
Termination is given, (2) the unpaid portion, if any, of any annual bonus for
any prior year, and (3) all other amounts to which you are entitled under any
compensation plan of the Company at the time such payments are due, and the
Corporation shall have no further obligations to you under this Agreement.

          (c)  If your employment by the Company shall be terminated by you for
Good Reason or by the Company other than for Cause or Disability, then you shall
be entitled to the benefits provided below:

                    (i)   the Corporation shall pay to you (1) your full base
          salary, when due, through the Date of Termination at the rate in
          effect at the time Notice of Termination is given, at the time
          specified in Section 5(e), (2) the unpaid portion, if any, of any
          annual bonus, plus an amount equal to your targeted annual bonus, pro
          rated from January 1 of the termination year through the Date of
          Termination, and (3) all other amounts to which you are entitled under
          any compensation plan of the Company at the time such payments are
          due;

                    (ii)  in lieu of any further salary payments to you for
          periods subsequent to the Date of Termination, the Corporation shall
          pay as severance pay to you, at the time specified in Section 5(e), a
          lump sum severance payment equal to the sum of two (2) times your
          annual base salary as in effect as of the Date of Termination or
          immediately prior to the Change in Control, whichever is greater, and
          two (2) times your targeted annual bonus as in effect as of the Date
          of Termination or the average annual bonus received by you with
          respect to the three (3) years immediately prior to the Change in
          Control, whichever is greater;

                    (iii) for a period of two (2) years, the Corporation shall
          continue to provide you and your eligible family members, based on the
          cost sharing

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          arrangement between you and the Company on the date of the Change in
          Control, with medical and dental health benefits at least equal to
          those which would have been provided to you and them if your
          employment had not been terminated or, if more favorable to you, as in
          effect generally at any time thereafter, provided, however, that if
          you become re-employed with another employer and are eligible to
          receive medical and dental health benefits under another employer's
          plans, the Corporation's obligations under this Section 5(c)(iii)
          shall be reduced to the extent comparable benefits are actually
          received by you, and any such benefits actually received by you shall
          be reported to the Corporation. In the event you are ineligible under
          the terms of such benefit plans or programs to continue to be so
          covered, in such event, the Corporation shall provide you with
          substantially equivalent coverage through other sources or will
          provide you with a lump sum payment in such amount that, after all
          taxes on that amount, shall be equal to the cost to you of providing
          yourself such benefit coverage. At the termination of the benefits
          coverage under the second preceding sentence, you, your spouse and
          your dependents shall be entitled to continuation coverage pursuant to
          Section 4980B of the Internal Revenue Code of 1986, as amended (the
          "Code"), Sections 601-608 of the Employee Retirement Income Security
          Act of 1974, as amended, and under any other applicable law, to the
          extent required by such laws, as if you had terminated employment with
          the Company on the date such benefits coverage terminates. The lump
          sum shall be determined on a present value basis using the interest
          rate provided in Section 1274(b)(2)(B) of the Code on the Date of
          Termination;

                    (iv) for a period of two (2) years following the Date of
          Termination, the Corporation shall, at its sole expense as incurred,
          provide you with outplacement services, the scope and provider of
          which shall be selected by you in your sole discretion, at an
          aggregate cost to the Corporation not to exceed twenty five percent
          (25%) of your annual base salary as in effect as of the Date of
          Termination or immediately prior to the Change in Control, whichever
          is greater;

                    (v)  you shall be fully vested in your accrued benefits
          under any qualified or nonqualified pension, profit sharing, deferred
          compensation or supplemental plans maintained by the Company for your
          benefit, except to the extent that the acceleration of vesting of such
          benefits would violate any applicable law or require the Corporation
          to accelerate the vesting of the accrued benefits of all participants
          in such plan or plans, in which case the Corporation may elect to pay
          you a lump sum payment at the time specified in Section 5(e) in an
          amount equal to the value of such unvested accrued benefits in lieu of
          accelerating the vesting of your benefits, plus the Corporation shall
          pay to you an amount equal to the amount the Company would have
          contributed to your account under the Company's 401(k) plan as a
          matching contribution had you remained

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          employed by the Company for three (3) years after your Date of
          Termination and had you made the maximum elected deferral
          contributions;

                    (vi)   the Corporation shall furnish you for six (6) years
          following the Date of Termination (without reference to whether the
          term of this Agreement continues in effect) with directors' and
          officers' liability insurance insuring you against insurable events
          which occur or have occurred while you were a director or officer of
          the Company, such insurance to have policy limits aggregating not less
          than the amount in effect immediately prior to the Change in Control,
          and otherwise to be in substantially the same form and to contain
          substantially the same terms, conditions and exceptions as the
          liability insurance policies provided for officers and directors of
          the Company in force from time to time, provided, however, that such
          terms, conditions and exceptions shall not be, in the aggregate,
          materially less favorable to you than those in effect on the date
          hereof; provided, further, that if the aggregate annual premiums for
          such insurance at any time during such period exceed one hundred and
          fifty percent (150%) of the per annum rate of premium currently paid
          by the Company for such insurance, then the Corporation shall provide
          the maximum coverage that will then be available at an annual premium
          equal to one hundred and fifty percent (150%) of such rate;

                    (vii)  in any situation where under applicable law the
          Corporation has the power to indemnify (or advance expenses to) you in
          respect of any judgments, fines, settlements, loss, cost or expense
          (including attorneys' fees) of any nature related to or arising out of
          your activities as an agent, employee, officer or director of the
          Company or in any other capacity on behalf of or at the request of the
          Company, the Corporation shall promptly on written request, indemnify
          (and advance expenses to) you to the fullest extent permitted by
          applicable law, including but not limited to making such findings and
          determinations and taking any and all such actions as the Corporation
          may, under applicable law, be permitted to have the discretion to take
          so as to effectuate such indemnification or advancement. Such
          agreement by the Corporation shall not be deemed to impair any other
          obligation of the Corporation respecting your indemnification
          otherwise arising out of this or any other agreement or promise of the
          Corporation or under any statute; and

                    (viii) (1) anything in this Agreement to the contrary
          notwithstanding, if it shall be determined that any payment or
          distribution to you or for your benefit (whether paid or payable or
          distributed or distributable) pursuant to the terms of this Agreement
          or otherwise pursuant to or by reason of any other agreement, policy,
          plan, program or arrangement, including without limitation any stock
          option, stock appreciation right or similar right, or the lapse or
          termination of any restriction on or the vesting or exercisability of
          any of the

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          foregoing (the "Payments") would be subject to the excise tax imposed
          by Section 4999 of the Code by reason of being "contingent on a change
          in the ownership or control" of the Corporation, within the meaning of
          Section 280G of the Code or to any similar tax imposed by state or
          local law, or any interest or penalties with respect to such excise
          tax (such tax or taxes, together with any such interest or penalties,
          are collectively referred to as the "Excise Tax"), then you shall be
          entitled to receive from the Corporation an additional payment (the
          "Gross-Up Payment") in an amount such that the net amount of the
          Payments and the Gross-Up Payment retained by you after the
          calculation and deduction of all Excise Taxes (including any interest
          or penalties imposed with respect to such taxes) on the payment and
          all federal, state and local income tax, employment tax and Excise Tax
          (including any interest or penalties imposed with respect to such
          taxes) on the Gross-Up Payment provided for in this Section
          5(c)(viii), and taking into account any lost or reduced tax deductions
          on account of the Gross-Up Payment, shall be equal to the Payments;

                         (2)  all determinations required to be made under this
          Section 5(c)(viii), including whether and when the Gross-Up Payment is
          required and the amount of such Gross-Up Payment, and the assumptions
          to be utilized in arriving at such determinations shall be made by the
          Accountants (as defined below) which shall provide you and the
          Corporation with detailed supporting calculations with respect to such
          Gross-Up Payment within fifteen (15) business days of the receipt of
          notice from you or the Corporation that you have received or will
          receive a Payment. For purposes of making the determinations and
          calculations required herein, the Accountants may make reasonable
          assumptions and approximations concerning applicable taxes and may
          rely on reasonable, good faith interpretations concerning the
          application of Sections 280G and 4999 of the Code, provided that the
          Accountant's determinations must be made on the basis of "substantial
          authority" (within the meaning of Section 6662 of the Code). For the
          purposes of this Section 5(c)(viii), the "Accountants" shall mean the
          Corporation's independent certified public accountants serving
          immediately prior to the Change in Control. In the event that the
          Accountants are also serving as accountant or auditor for the
          individual, entity or group effecting the Change in Control, you shall
          appoint another nationally recognized public accounting firm to make
          the determinations required hereunder (which accounting firm shall
          then be referred to as the Accountants hereunder). All fees and
          expenses of the Accountants shall be borne solely by the Corporation;

                         (3)  for the purposes of determining whether any of the
          Payments will be subject to the Excise Tax and the amount of such
          Excise Tax, such 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

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          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 opinion of the Accountants such Payments (in whole or in
          part) either do not constitute "parachute payments" or represent
          reasonable compensation for services actually rendered (within the
          meaning of Section 280G(b)(4) of the Code) in excess of the "base
          amount," or such "parachute payments" are otherwise not subject to
          such Excise Tax. For purposes of determining the amount of the Gross-
          Up Payment you shall be deemed to pay federal income taxes at the
          highest applicable marginal rate of federal income taxation for the
          calendar year in which the Gross-Up Payment is to be made and to pay
          any applicable state and local income taxes at the highest applicable
          marginal rate of taxation for the calendar year in which the Gross-Up
          Payment is to be made, net of the maximum reduction in federal income
          taxes which could be obtained from the deduction of such state or
          local taxes if paid in such year (determined without regard to
          limitations on deductions based upon the amount of your adjusted gross
          income), and to have otherwise allowable deductions for federal, state
          and local income tax purposes at least equal to those disallowed
          because of the inclusion of the Gross-Up Payment in your adjusted
          gross income. To the extent practicable, any Gross-Up Payment with
          respect to any Payment shall be paid by the Corporation at the time
          you are entitled to receive the Payments and in no event will any
          Gross-Up Payment be paid later than five (5) days after the receipt by
          you of the Accountant's determination. Any determination by the
          Accountants shall be binding upon the Corporation and you;

                         (4)  as a result of uncertainty in the application of
          Section 4999 of the Code at the time of the initial determination by
          the Accountants hereunder, it is possible that the Gross-Up Payment
          made will have been an amount less than the Corporation should have
          paid pursuant to this Section 5(c)(viii) (the "Underpayment"). In the
          event that the Corporation exhausts its remedies pursuant to Section
          5(c)(viii)(3) and you are required to make a payment of any Excise
          Tax, the Underpayment shall be promptly paid by the Corporation to or
          for your benefit;

                         (5)  you and the Corporation shall each provide the
          Accountants access to and copies of any books, records and documents
          in the possession of the Corporation or you, as the case may be,
          reasonably requested by the Accountants, and otherwise cooperate with
          the Accountants in connection with the preparation and issuance of the
          determination contemplated by this Section 5(c)(viii); and

                         (6)  you shall notify the Corporation in writing of any
          claim by the Internal Revenue Service that, if successful, would
          require the

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          payment by the Corporation of the Gross-Up Payment. Such notification
          shall be given as soon as practicable after you are informed in
          writing of such claim and shall apprise the Corporation of the nature
          of such claim and the date on which such claim is requested to be
          paid. You shall not pay such claim prior to the expiration of the 30-
          day period following the date on which you give such notice to the
          Corporation (or such shorter period ending on the date that any
          payment of taxes, interest and/or penalties with respect to such claim
          is due). If the Corporation notifies you in writing prior to the
          expiration of such period that it desires to contest such claim, you
          shall:

                              (A)  give the Corporation any information
               reasonably requested by the Corporation relating to such claim;

                              (B)  take such action in connection with
               contesting such claim as the Corporation shall reasonably request
               in writing from time to time, including, without limitation,
               accepting legal representation with respect to such claim by an
               attorney reasonably selected by the Corporation;

                              (C)  cooperate with the Corporation in good faith
               in order to effectively contest such claim; and

                              (D)  permit the Corporation to participate in any
               proceedings relating to such claims;

          provided, however, that the Corporation shall bear and pay directly
          all costs and expenses (including additional interest and penalties)
          incurred in connection with such contest and shall indemnify you for
          and hold you harmless from, on an after-tax basis, any Excise Tax or
          income tax (including interest and penalties with respect thereto)
          imposed as a result of such representation and payment of all related
          costs and expenses. Without limiting the foregoing provisions of this
          Section 5(c)(viii), the Corporation shall control all proceedings
          taken in connection with such contest and, at its sole option, may
          pursue or forgo any and all administrative appeals, proceedings,
          hearings and conferences with the taxing authority in respect of such
          claim and may, at its sole option, either direct you to pay the tax
          claimed and sue for a refund or contest the claim in any permissible
          manner, and you agree to prosecute such contest to a determination
          before any administrative tribunal, in a court of initial jurisdiction
          and in one or more appellate courts, as the Corporation shall
          determine; provided, however, that if the Corporation directs you to
          pay such claim and sue for a refund, the Corporation shall advance the
          amount of such payment to you, on an interest-free basis, and shall
          indemnify you for and hold you harmless from, on an after-tax basis,
          any Excise Tax or income tax (including interest or penalties with
          respect thereto)

                                       12
<PAGE>

          imposed with respect to such advance or with respect to any imputed
          income with respect to such advance (including as a result of any
          forgiveness by the Corporation of such advance); provided, further,
          that any extension of the statute of limitations relating to the
          payment of taxes for your taxable year with respect to which such
          contested amount is claimed to be due is limited solely to such
          contested amount. Furthermore, the Corporation's control of the
          contest shall be limited to issues with respect to which a Gross-Up
          Payment would be payable hereunder and you shall be entitled to settle
          or contest, as the case may be, any other issue raised by the Internal
          Revenue Service or any other taxing authority.

          (d)  If your employment by the Company shall be terminated by you
pursuant to a Covered Resignation, then you shall be entitled to the benefits
provided for in Section 5(c) except that (i) the severance benefits provided in
Section 5(c)(ii) shall be fifty percent (50%) of benefit provided therein, and
(ii) the medical and dental benefits provided in Section 5(c)(iii) shall be for
a maximum period of one (1) year.

          (e)  The payments provided for in Sections 5(c)(i), (ii), (iii) and
5(d) shall be made not later than the fifth day following the Date of
Termination; provided, however, that if the amounts of such payments cannot be
finally determined on or before such day, the Corporation shall pay to you on
such day an estimate, as determined in good faith by the Corporation, of the
minimum amount of such payments and shall pay the remainder of such payments
(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
the thirtieth day after the Date of Termination. In the event that the amount of
the estimated payments exceeds the amount subsequently determined to have been
due, such excess shall constitute a loan by the Corporation to you, payable on
the fifth day after demand by the Corporation (together with interest at the
rate provided in Section 1274(b)(2)(B) of the Code).

          (f)  You shall not be required to mitigate the amount of any payment
provided for in this Section 5 by seeking other employment or otherwise nor,
except as provided in Section 5(c)(iii), shall the amount of any payment or
benefit provided for in this Section 5 be reduced by any compensation earned by
you as the result of employment by another employer or self-employment, by
retirement benefits, by offset against any amount claimed to be owed by you to
the Corporation, or otherwise.

          6.   Successors; Binding Agreement.
               -----------------------------

          (a)  The Corporation shall require any successor (whether direct or
indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the Corporation to expressly
assume and agree to perform this Agreement in the same manner and to the same
extent that the Corporation would be required to perform it if no such
succession had taken place. Failure of the Corporation to obtain such assumption
and agreement prior to the effectiveness of any such succession shall be a
breach of this Agreement and shall

                                       13
<PAGE>

entitle you to terminate your employment and receive compensation from the
Corporation in the same amount and on the same terms to which you would be
entitled hereunder if you terminate your employment for Good Reason following a
Change in Control, except that for purposes of implementing the foregoing, the
date on which any such succession becomes effective shall be deemed the Date of
Termination. Unless expressly provided otherwise, "Corporation" as used herein
shall mean the Corporation as defined in this Agreement and any successor to its
business and/or assets as aforesaid.

          (b)  This Agreement shall inure to the benefit of and be enforceable
by you and your personal or legal representatives, executors, administrators,
successors, heirs, distributees, devisees and legatees. If you should die while
any amount would still be payable to you hereunder had you continued to live,
all such amounts, unless otherwise provided herein, shall be paid in accordance
with the terms of this Agreement to your devisee, legatee or other designee or,
if there is no such designee, to your estate.

          7.   Notice. For the purpose of this Agreement, notices and all other
               ------
communications provided for in this Agreement shall be in writing and shall be
deemed to have been duly given when delivered or mailed by United States
certified or registered mail, return receipt requested, postage prepaid,
addressed to the respective addresses set forth on the first page of this
Agreement, provided that all notices to the Corporation shall be directed to the
attention of the Board with a copy to the Secretary of the Corporation, or to
such other address as either party may have furnished to the other in writing in
accordance herewith, except that notice of change of address shall be effective
only upon receipt.

          8.   Confidentiality and Non-Solicitation Covenants.
               ----------------------------------------------

          (a)  Confidentiality. You hereby agree that commencing on the Date of
               ---------------
Termination, you shall not, directly or indirectly, disclose or make available
to any person, firm, corporation, association or other entity for any reason or
purpose whatsoever, any Confidential Information (as defined below). You agree
that, upon termination of your employment with the Company, all Confidential
Information in your possession that is in written or other tangible form
(together with all copies or duplicates thereof, including computer files) shall
be returned to the Corporation and shall not be retained by you or furnished to
any third party, in any form except as provided herein; provided, however, that
you shall not be obligated to treat as confidential, or return to the
Corporation copies of any Confidential Information that (i) was publicly known
at the time of disclosure to you, (ii) becomes publicly known or available
thereafter other than by any means in violation of this Agreement or any other
duty owed to the Company by any person or entity, or (iii) is lawfully disclosed
to you by a third party. As used in this Agreement, the term "Confidential
Information" means: information disclosed to you or known by you as a
consequence of or through your relationship with the Company, about the
customers, employees, business methods, public relations methods, organization,
procedures or finances, including, without limitation, information of or
relating to customer lists, of the Company.

                                       14
<PAGE>

          (b)  Non-Solicitation. You hereby agree that, for the period
               ----------------
commencing on the Date of Termination and terminating on the first anniversary
thereof, you shall not, either on your own account or jointly with or as a
manager, agent, officer, employee, consultant, partner, joint venturer, owner or
shareholder or otherwise on behalf of any other person, firm or corporation,
directly or indirectly solicit or attempt to solicit away from the Company any
of its officers or employees or offer employment to any person who, on or during
the six (6) months immediately preceding the date of such solicitation or offer,
is or was an officer or employee of the Company; provided, however, that a
general advertisement to which an employee of the Company responds shall in no
event be deemed to result in a breach of this Section 8(b).

          9.   Governing Law. The validity, interpretation, construction and
               -------------
performance of this Agreement shall be governed on a non-exclusive basis by the
laws of the State of California without giving effect to its conflicts of laws
rules.

          10.  Joint and Several Liability. Any successors or assigns shall
               ----------------------------
be jointly and severally liable with the Corporation under this Agreement.

          11.  Miscellaneous. No provision of this Agreement may be modified,
               -------------
waived or discharged unless such waiver, modification or discharge is agreed to
in writing and signed by you and such officer as may be specifically designated
by the Board. No waiver by either party hereto at any time of any breach by the
other party hereto of or compliance with, any condition or provision of this
Agreement to be performed by such other party shall be deemed a waiver of
similar or dissimilar provisions or conditions at the same or at any prior or
subsequent time. No agreements or representations, oral or otherwise, express or
implied, with respect to the subject matter hereof have been made by either
party which are not expressly set forth in this Agreement. All references to
sections of the Exchange Act or the Code shall be deemed also to refer to any
successor provisions to such sections. Any payments provided for hereunder shall
be paid net of any applicable withholding required under federal, state or local
law. Any obligations of the Corporation under Sections 5 and 6 shall survive the
expiration of the term of this Agreement. The section headings contained in this
Agreement are for convenience only, and shall not affect the interpretation of
this Agreement.

          12.  Severability. The invalidity or unenforceability of any provision
               ------------
of this Agreement shall not affect the validity or enforceability of any other
provision of this Agreement, which shall remain in full force and effect.

          13.  Counterparts. This Agreement may be executed in several
               ------------
counterparts, each of which shall be deemed to be an original but all of which
together shall constitute one and the same instrument.

          14.  Arbitration; Dispute Resolution, Etc.
               ------------------------------------

                                       15
<PAGE>

          (a)  Arbitration Procedure. Any disagreement, dispute, controversy or
               ---------------------
claim arising out of or relating to this Agreement or the interpretation of this
Agreement or any arrangements relating to this Agreement or contemplated in this
Agreement or the breach, termination or invalidity thereof shall be settled by
final and binding arbitration administered by the JAMS/Endispute in Los Angeles,
California in accordance with its then existing JAMS/Endispute Arbitration Rules
and Procedures for Employment Disputes. In the event of such an arbitration
proceeding, you and the Corporation shall select a mutually acceptable neutral
arbitrator from among the JAMS/Endispute panel of arbitrators. In the event you
and the Corporation cannot agree on an arbitrator, the Administrator of
JAMS/Endispute will appoint an arbitrator. Neither you nor the Corporation nor
the arbitrator shall disclose the existence, content, or results of any
arbitration hereunder without the prior written consent of all parties. Except
as provided herein, the Federal Arbitration Act shall govern the interpretation,
enforcement and all proceedings under this Section 14. The arbitrator shall
apply the substantive law (and the law of remedies, if applicable) of the State
of California, or federal law, or both, as applicable and the arbitrator is
without jurisdiction to apply any different substantive law. The arbitrator
shall have the authority to entertain a motion to dismiss and/or a motion for
summary judgment by any party and shall apply the standards governing such
motions under the Federal Rules of Civil Procedure. The arbitrator shall render
an award and a written, reasoned opinion in support thereof. Judgment upon the
award may be entered in any court having jurisdiction thereof. For purposes of
jurisdiction and venue, the Corporation hereby consents to jurisdiction and
venue in any suit, action or proceeding with respect to this Agreement in any
court of competent jurisdiction in the state in which you reside at the
commencement of such suit, action or proceeding and waives any objection,
challenge or dispute as to such jurisdiction or venue being proper. The
Corporation shall pay all fees and expenses of the Arbitrator regardless of the
result and shall provide all witnesses and evidence reasonably required by you
to present your case.

          (b)  Compensation During Dispute, Etc. Your compensation during any
               --------------------------------
disagreement, dispute, controversy, claim, suit, action or proceeding
(collectively, a "Dispute") arising out of or relating to this Agreement or the
interpretation of this Agreement shall be as follows. If there is a termination
of your employment with the Company after a Change in Control followed by a
Dispute as to whether you are entitled to the payments and other benefits
provided under this Agreement, then, during the period of that Dispute the
Corporation shall pay you fifty percent (50%) of the amount specified in
Sections 5(c)(i) and 5(c)(ii) hereof, and the Corporation shall provide you with
the other benefits provided in Section 5(c) of this Agreement, if, but only if,
you agree in writing that if the Dispute is resolved against you, you shall
promptly refund to the Corporation all payments you receive under Sections
5(c)(i) and 5(c)(ii) of this Agreement plus interest at the rate provided in
Section 1274(d) of the Code, compounded quarterly. If the Dispute is resolved in
your favor, promptly after resolution of the dispute the Corporation shall pay
you the sum that was withheld during the period of the Dispute plus interest at
the rate provided in Section 1274(d) of the Code, compounded quarterly.

                                       16
<PAGE>

          (c)  Legal Fees. In addition to all other amounts payable to you under
               ----------
this Agreement, the Corporation shall pay to you all legal fees and expenses
incurred by you in connection with any Dispute arising out of or relating to
this Agreement or the interpretation thereof (including, without limitation, all
such fees and expenses, if any, incurred in contesting or disputing any
termination of your employment or in seeking to obtain or enforce any right or
benefit provided by this Agreement, or in connection with any tax audit or
proceeding to the extent attributable to the application of Section 4999 of the
Code to any payment or benefit provided hereunder), regardless of the outcome of
such proceeding; provided, however, that in the event you commence such action,
you shall not be entitled to recover such fees and costs if the court determines
that you brought the claim in bad faith or the claim was frivolous. Any
attorney's fees incurred by you shall be paid by the Corporation in advance of
the final disposition of such action or challenge, as such fees and expenses are
incurred; provided, however, that you agree to repay such amounts, net of any
income taxes paid or payable by you with respect to such amounts, if such
amounts are incurred in connection with an action commenced by you if it is
ultimately determined by the court that you brought such action in bad faith or
the claim was frivolous.

          15.  At-Will Employment. Nothing in the foregoing diminishes or alters
               ------------------
the Company's policy of at-will employment for all employees, where both the
Company and you may terminate the employment relationship at any time and for
any reason, with or without cause or notice.

          16.  Entire Agreement. This Agreement sets forth the entire agreement
               ----------------
of the parties hereto in respect of the subject matter contained herein and
supersedes all prior agreements, promises, covenants, arrangements,
communications, representations or warranties, whether oral or written, by any
officer, employee or representative of any party hereto; and any prior agreement
of the parties hereto in respect of the subject matter contained herein,
including, without limitation, any prior severance agreements, is hereby
terminated and cancelled. Any of your rights hereunder shall be in addition to
any rights you may otherwise have under benefit plans or agreements of the
Company to which you are a party or in which you are a participant, including,
but not limited to, any Company sponsored employee benefit plans and stock
options plans. Provisions of this Agreement shall not in any way abrogate your
rights under such other plans and agreements.

          If this letter sets forth our agreement on the subject matter hereof,
kindly sign and return to the Corporation the enclosed copy of this letter,
which shall then constitute our agreement on this subject.

                                       17
<PAGE>

                                             Sincerely,

                                             SCPIE HOLDINGS INC.

                                             By: ______________________________

                                             Its:______________________________

Agreed to this __ day
of December, 2000.

_______________________________
[Executive]

                                       18<PAGE>

                                                                   Exhibit 10.79

               [TIER III CHANGE IN CONTROL SEVERANCE AGREEMENT]

                              SCPIE HOLDINGS INC.
                       1888 Century Park East, Suite 800
                         Los Angeles, California 90067

                               December __, 2000

[Executive]
c/o SCPIE Management Company
1888 Century Park East, Suite 800
Los Angeles, California 90067

Dear [Executive]:

          SCPIE Holdings Inc. (the "Corporation") considers it essential to the
best interests of its shareholders to foster the continuous employment of key
management personnel. In connection with this, the Corporation's Board of
Directors (the "Board") recognizes that, as is the case with many publicly held
corporations, the possibility of a change in control of the Corporation may
exist and that the uncertainty and questions that it may raise among management
could result in the departure or distraction of management personnel to the
detriment of the Corporation and its shareholders.

          The Board has decided to reinforce and encourage the continued
attention and dedication of members of the Corporation's management, including
yourself, to their assigned duties without the distraction arising from the
possibility of a change in control of the Corporation.

          In order to induce you to remain in the employ of the Corporation or
any of its affiliates (collectively, the "Company"), the Corporation hereby
agrees that after this letter agreement (this "Agreement") has been fully
executed, you shall receive the severance benefits set forth in Section 5 of
this Agreement in the event your employment with the Company is terminated
under the circumstances described in Section 4 of this Agreement subsequent to a
Change in Control (as defined in Section 2).

                                       1
<PAGE>

          1.   Term of Agreement. This Agreement shall commence on the date
               -----------------
hereof and shall continue in effect through December 31, 2003; provided,
however, that commencing on January 1, 2001 and on each January 1 thereafter,
the term of this Agreement shall automatically be extended for one additional
year unless, not later than September 30 of the preceding year, the Corporation
shall have given notice that it does not wish to extend this Agreement;
provided, further, that if a Change in Control (as defined in Section 2), occurs
during the original or any extended term of this Agreement, the term of this
Agreement shall continue in effect for a period of not less than thirty-six (36)
months beyond the month in which such Change in Control occurred.

          2.   Change in Control.
               -----------------

          No benefits shall be payable under Section 4 of this Agreement unless
there has been a Change in Control. For purposes of this Agreement, a Change in
Control shall be deemed to occur if:

          (a)  any Person (as defined in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934, as amended (the "Exchange Act")) is or becomes
the Beneficial Owner (as defined in Rule 13d-3 under the Exchange Act), directly
or indirectly, of securities of the Corporation representing 20% or more of
the combined voting power of the Corporation's then outstanding securities
("Outstanding Corporation Voting Securities"); provided, however, that for
purposes of this subsection (a), the following shall not constitute a Change in
Control: (i) any acquisition by the Corporation or any corporation controlled by
the Corporation, (ii) any acquisition by any employee benefit plan (or related
trust) sponsored or maintained by the Corporation or any corporation controlled
by the Corporation, or (iii) any acquisition by a Person of 20% of the
Outstanding Corporation Voting Securities as a result of an acquisition of
common stock of the Corporation by the Corporation which, by reducing the number
of shares of common stock of the Corporation outstanding, increases the
proportionate number of shares beneficially owned by such Person to 20% or more
of the Outstanding Corporation Voting Securities; provided, however, that if a
Person shall become the beneficial owner of 20% or more of the Outstanding
Corporation Voting Securities by reason of a share acquisition by the
Corporation as described above and shall, after such share acquisition by the
Corporation, become the beneficial owner of any additional shares of common
stock of the Corporation, then such acquisition shall constitute a Change in
Control;

          (b)  during any period of two consecutive years (not including any
period prior to the execution of this Agreement), individuals who at the
beginning of such period constitute the Board, and any new director (other than
a director designated by a person who has entered into an agreement with
Corporation to effect a transaction described in Sections 2(a), (c), (d) or (e))
whose election by the Board or nomination for election by the Corporation's
stockholders was approved by a vote of at least two-thirds (2/3) of the
directors then still in office who either were directors at the beginning of the
period or whose election or nomination for election was

                                       2
<PAGE>

previously so approved (hereinafter referred to as "Continuing Directors"),
cease for any reason to constitute at least a majority thereof;

          (c)  the consummation by the Corporation of a merger or consolidation
of Corporation with any other corporation (or other entity), other than a merger
or consolidation which would result in the voting securities of the Corporation
outstanding immediately prior thereto continuing to represent (either by
remaining outstanding or by being converted into voting securities of the
surviving entity) 50% or more of the combined voting power of the voting
securities of the Corporation or such surviving entity outstanding immediately
after such merger or consolidation; provided, however, that a merger or
consolidation effected to implement a recapitalization of the Corporation (or
similar transaction) in which no Person acquires more than 20% of the
Outstanding Corporation Voting Securities shall not constitute a Change in
Control;

          (d)  the stockholders of the Corporation approve a plan of complete
liquidation of the Corporation; or

          (e)  the consummation of an agreement (or agreements) providing for
the sale or disposition by the Corporation of all or substantially all of the
Corporation's assets other than a sale or disposition which would result in the
voting securities of the Corporation outstanding immediately prior thereto
continuing to represent 50% or more of the combined voting power of the
Corporation or such surviving entity outstanding immediately after such sale or
disposition.

          3.   Accelerated Vesting Upon a Change in Control.
               --------------------------------------------

          Notwithstanding any provisions of the Company's stock option plans,
incentive plans, or other similar plans, all outstanding options ("Options"), if
any, granted to you under any of the Company's stock option plans, incentive
plans, or other similar plans (or options substituted therefor covering the
stock of a successor corporation) shall become fully vested and exercisable
immediately prior to the Change in Control as to all shares of stock covered
thereby, and the restricted period with respect to any restricted stock or any
other equity award granted to you thereunder shall lapse and such shares shall
be distributed to you immediately prior to the Change in Control, unless it
would adversely affect the Corporation's ability to use pooling of interest
accounting in a Change in Control transaction in which such accounting is
intended to be used.

          4.   Termination of Employment Following a Change in Control.
               -------------------------------------------------------

          (a)  General. During the term of this Agreement, if any of the events
               -------
described in Section 2 constituting a Change in Control shall have occurred, you
shall be entitled to the benefits provided in Section 5(c) upon the subsequent
termination of your employment, provided that such termination occurs during the
term of this Agreement and within the two (2) year period immediately following
the date of such Change in Control, unless such termination is (i)

                                       3
<PAGE>

because of your death or Disability (as defined in Section 4(b)), (ii) by the
Company for Cause (as defined in Section 4(c)), or (iii) by you other than (1)
for Good Reason (as defined in Section 4(d)), or (2) in a Covered Resignation
(as defined in Section 4(e)). In the event that you are entitled to such
benefits, such benefits shall be paid notwithstanding the subsequent expiration
of the term of this Agreement.

          (b)  Disability. If, as a result of your incapacity due to physical or
               ----------
mental illness, you shall have been absent from the full-time performance of
your duties with the Company for six (6) consecutive months, and within thirty
(30) days after written notice of termination is given you shall not have
returned to the full-time performance of your duties, your employment may be
terminated for "Disability."

          (c)  Cause. Termination by the Company of your employment for
               -----
"Cause" shall mean termination (i) upon your willful and continued failure to
substantially perform your duties with the Company (other than any such failure
resulting from your incapacity due to physical or mental illness or any such
actual or anticipated failure after your issuance of a Notice of Termination (as
defined in Section 4(f) for Good Reason), after a written demand for substantial
performance is delivered to you by the Board, which demand specifically
identifies the manner in which the Board believes that you have not
substantially performed your duties, (ii) upon your willful and continued
failure to substantially follow and comply with the specific and lawful
directives of the Board, as reasonably determined by the Board (other than any
such failure resulting from your incapacity due to physical or mental illness or
any such actual or anticipated failure after your issuance of a Notice of
Termination for Good Reason), after a written demand for substantial performance
is delivered to you by the Board, which demand specifically identifies the
manner in which the Board believes that you have not substantially performed
your duties, (iii) upon your willful commission of an act of fraud or dishonesty
resulting in material economic or financial injury to the Company, or (iv) upon
your willful engagement in illegal conduct or gross misconduct, in each case
which is materially and demonstrably injurious to the Company. For purposes of
this Section 4(c), no act, or failure to act, on your part shall be deemed
"willful" unless done, or omitted to be done, by you not in good faith.
Notwithstanding the foregoing, you shall not be deemed terminated for Cause
pursuant to Sections 4(c)(i), (ii) or (iv) hereof unless and until there shall
have been delivered to you a copy of a resolution duly adopted by the
affirmative vote of not less than three-quarters (3/4) of the entire membership
of the Board at a meeting of the Board (after reasonable notice to you, an
opportunity for you, together with your counsel, to be heard before the Board
and a reasonable opportunity to cure), finding that in the Board's good faith
opinion you were guilty of conduct set forth above in this Section 4(c) and
specifying the particulars thereof in reasonable detail.

          (d)  Good Reason. You shall be entitled to terminate your employment
               -----------
for Good Reason. For purposes of this Agreement, "Good Reason" shall mean,
without your express written consent, the occurrence after a Change in Control
of any of the following

                                       4
<PAGE>

circumstances unless, in the case of Sections 4(d)(i), (v), (vi), or (vii), such
circumstances are fully corrected (provided such circumstances are capable of
correction) prior to the Date of Termination (as defined in Section 4(g))
specified in the Notice of Termination given in respect thereof:

               (i)    the assignment to you of any duties inconsistent with the
     position in the Company that you held immediately prior to the Change in
     Control, a significant adverse alteration in the nature or status of your
     responsibilities or the conditions of your employment from those in effect
     immediately prior to such Change in Control, or any other action by the
     Company that results in a material diminution in your position, authority,
     duties or responsibilities;

               (ii)   the Company's reduction by more than 10% of your annual
     total compensation as in effect on the date hereof or as the same may be
     increased from time to time;

               (iii)  the relocation of the Company's offices at which you are
     principally employed immediately prior to the date of the Change in Control
     (your "Principal Location") which results in the one-way commuting distance
     for you increasing by more than thirty (30) miles from such location, or
     the Company's requiring you, without your written consent, to be based
     anywhere other than your Principal Location, except for required travel on
     the Company's business to an extent substantially consistent with your
     present business travel obligations;

               (iv)   the Company's failure to pay to you any portion of your
     current compensation or to pay to you any portion of an installment of
     deferred compensation under any deferred compensation program of the
     Company within seven (7) days after the date such compensation is due;

               (v)    the Company's failure to continue in effect any material
     compensation or benefit plan in which you participate immediately prior to
     the Change in Control, unless an equitable arrangement (embodied in an
     ongoing substitute or alternative plan) has been made with respect to such
     plan, or the Company's failure to continue your participation therein (or
     in such substitute or alternative plan) on a basis not materially less
     favorable, both in terms of the amount of benefits provided and the level
     of your participation relative to other participants, as existed at the
     time of the Change in Control;

               (vi)   the Corporation's failure to obtain a satisfactory
     agreement from any successor to assume and agree to perform this Agreement,
     as contemplated in Section 6 hereof; or

                                       5
<PAGE>

               (vii)  any purported termination of your employment that is not
     effected pursuant to a Notice of Termination satisfying the requirements of
     Section 4(f) hereof (and, if applicable, the requirements of Section 4(c)
     hereof), which purported termination shall not be effective for purposes of
     this Agreement.

Your right to terminate your employment pursuant to this Section 4(d) shall not
be affected by your incapacity due to physical or mental illness. Your continued
employment shall not constitute consent to, or a waiver of rights with respect
to, any circumstance constituting Good Reason hereunder. Any good faith
determination by you that Good Reason exists shall be presumed correct and shall
be binding upon the Corporation.

          (e)  Voluntary Termination and Covered Resignation. You shall be
               ---------------------------------------------
entitled to voluntarily terminate your employment for any reason or no reason at
any time after a Change in Control. Any such termination which occurs within the
thirty (30)-day period following the first anniversary of the occurrence of a
Change in Control (a "Covered Resignation") shall constitute a resignation which
entitles you to receive benefits under this Agreement.

          (f)  Notice of Termination. Any purported termination of your
               ---------------------
employment by the Company or by you (other than termination due to death which
shall terminate your employment automatically) shall be communicated by written
Notice of Termination to the other party hereto in accordance with Section 7.
"Notice of Termination" shall mean a notice that shall indicate the specific
termination provision in this Agreement relied upon and shall set forth in
reasonable detail the facts and circumstances claimed to provide a basis for
termination of your employment under the provision so indicated.

          (g)  Date of Termination, Etc. "Date of Termination" shall mean (a) if
               ------------------------
your employment is terminated due to your death, the date of your death; (b) if
your employment is terminated for "Disability, thirty (30) days after Notice of
Termination is given (provided that you shall not have returned to the full-time
performance of your duties during such thirty (30)-day period), and (c) if your
employment is terminated pursuant to Section 4(c), Section 4(d) or Section 4(e)
or for any other reason (other than death or Disability), the date specified in
the Notice of Termination (which, in the case of a termination for Cause shall
not be less than thirty (30) days from the date such Notice of Termination is
given, and in the case of a termination for Good Reason or in connection with a
Covered Resignation shall not be less than fifteen (15) nor more than sixty (60)
days from the date such Notice of Termination is given).

          5.   Compensation Upon Termination or During Disability Following A
               --------------------------------------------------------------
               Change in Control.
               -----------------

          Following a Change in Control during the term of this Agreement, you
shall be entitled to the benefits described below during a period of disability,
or upon termination of your employment, as the case may be, provided that such
period or termination occurs during the term of this Agreement and within the
two (2) year period immediately following the date of such

                                       6
<PAGE>

Change in Control. The benefits to which you are entitled, subject to the terms
and conditions of this Agreement, are:

          (a)  During any period during which you fail to perform your full-time
duties with the Company as a result of incapacity due to physical or mental
illness, you shall continue to receive your base salary at the rate in effect at
the commencement of any such period, together with all compensation payable to
you under the Company's disability plan or program or other similar plan during
such period, until this Agreement is terminated pursuant to Section 4(b) hereof.
Thereafter, or in the event your employment is terminated by reason of your
death, your benefits shall be determined under the Company's retirement,
insurance and other compensation programs then in effect in accordance with the
terms of such programs.

          (b)  If your employment shall be terminated (i) by the Company for
Cause or (ii) by you other than for Good Reason or pursuant to a Covered
Resignation, the Corporation shall pay you (1) your full base salary, when due,
through the Date of Termination at the rate in effect at the time Notice of
Termination is given, (2) the unpaid portion, if any, of any annual bonus for
any prior year, and (3) all other amounts to which you are entitled under any
compensation plan of the Company at the time such payments are due, and the
Corporation shall have no further obligations to you under this Agreement.

          (c)  If your employment by the Company shall be terminated by you for
Good Reason or by the Company other than for Cause or Disability, then you shall
be entitled to the benefits provided below:

                    (i)   the Corporation shall pay to you (1) your full base
          salary, when due, through the Date of Termination at the rate in
          effect at the time Notice of Termination is given, at the time
          specified in Section 5(e), (2) the unpaid portion, if any, of any
          annual bonus, plus an amount equal to your targeted annual bonus, pro
          rated from January 1 of the termination year through the Date of
          Termination, and (3) all other amounts to which you are entitled under
          any compensation plan of the Company at the time such payments are
          due;

                    (ii)  in lieu of any further salary payments to you for
          periods subsequent to the Date of Termination, the Corporation shall
          pay as severance pay to you, at the time specified in Section 5(e), a
          lump sum severance payment (the "Severance Payment") equal to the sum
          of your annual base salary as in effect as of the Date of Termination
          or immediately prior to the Change in Control, whichever is greater,
          and your targeted annual bonus as in effect as of the Date of
          Termination or the average annual bonus received by you with respect
          to the three (3) years immediately prior to the Change in Control,
          whichever is greater;

                    (iii) for a period of one (1) year, the Corporation shall
          continue to provide you and your eligible family members, based on the
          cost sharing

                                       7
<PAGE>

                    arrangement between you and the Company on the date of the
                    Change in Control, with medical and dental health benefits
                    at least equal to those which would have been provided to
                    you and them if your employment had not been terminated or,
                    if more favorable to you, as in effect generally at any time
                    thereafter, provided, however, that if you become re-
                    employed with another employer and are eligible to receive
                    medical and dental health benefits under another employer's
                    plans, the Corporation's obligations under this Section
                    5(c)(iii) shall be reduced to the extent comparable benefits
                    are actually received by you, and any such benefits actually
                    received by you shall be reported to the Corporation. In the
                    event you are ineligible under the terms of such benefit
                    plans or programs to continue to be so covered, in such
                    event, the Corporation shall provide you with substantially
                    equivalent coverage through other sources or will provide
                    you with a lump sum payment in such amount that, after all
                    taxes on that amount, shall be equal to the cost to you of
                    providing yourself such benefit coverage. At the termination
                    of the benefits coverage under the second preceding
                    sentence, you, your spouse and your dependents shall be
                    entitled to continuation coverage pursuant to Section 4980B
                    of the Internal Revenue Code of 1986, as amended (the
                    "Code"), Sections 601-608 of the Employee Retirement Income
                    Security Act of 1974, as amended, and under any other
                    applicable law, to the extent required by such laws, as if
                    you had terminated employment with the Company on the date
                    such benefits coverage terminates. The lump sum shall be
                    determined on a present value basis using the interest rate
                    provided in Section 1274(b)(2)(B) of the Code on the Date of
                    Termination;

                              (iv) for a period of two (2) years following the
                    Date of Termination, the Corporation shall, at its sole
                    expense as incurred, provide you with outplacement services,
                    the scope and provider of which shall be selected by you in
                    your sole discretion, at an aggregate cost to the
                    Corporation not to exceed twenty five percent (25%) of your
                    annual base salary as in effect as of the Date of
                    Termination or immediately prior to the Change in Control,
                    whichever is greater;

                              (v)  you shall be fully vested in your accrued
                    benefits under any qualified or nonqualified pension, profit
                    sharing, deferred compensation or supplemental plans
                    maintained by the Company for your benefit, except to the
                    extent that the acceleration of vesting of such benefits
                    would violate any applicable law or require the Corporation
                    to accelerate the vesting of the accrued benefits of all
                    participants in such plan or plans, in which case the
                    Corporation may elect to pay you a lump sum payment at the
                    time specified in Section 5(e) in an amount equal to the
                    value of such unvested accrued benefits in lieu of
                    accelerating the vesting of your benefits, plus the
                    Corporation shall pay to you an amount equal to the amount
                    the Company would have contributed to your account under the
                    Company's 401(k) plan as a matching contribution had you
                    remained

                                       8
<PAGE>

                    employed by the Company for three (3) years after your Date
                    of Termination and had you made the maximum elected deferral
                    contributions;

                              (vi)   the Corporation shall furnish you for six
                    (6) years following the Date of Termination (without
                    reference to whether the term of this Agreement continues in
                    effect) with directors' and officers' liability insurance
                    insuring you against insurable events which occur or have
                    occurred while you were a director or officer of the
                    Company, such insurance to have policy limits aggregating
                    not less than the amount in effect immediately prior to the
                    Change in Control, and otherwise to be in substantially the
                    same form and to contain substantially the same terms,
                    conditions and exceptions as the liability insurance
                    policies provided for officers and directors of the Company
                    in force from time to time, provided, however, that such
                    terms, conditions and exceptions shall not be, in the
                    aggregate, materially less favorable to you than those in
                    effect on the date hereof; provided, further, that if the
                    aggregate annual premiums for such insurance at any time
                    during such period exceed one hundred and fifty percent
                    (150%) of the per annum rate of premium currently paid by
                    the Company for such insurance, then the Corporation shall
                    provide the maximum coverage that will then be available at
                    an annual premium equal to one hundred and fifty percent
                    (150%) of such rate;

                              (vii)  in any situation where under applicable law
                    the Corporation has the power to indemnify (or advance
                    expenses to) you in respect of any judgments, fines,
                    settlements, loss, cost or expense (including attorneys'
                    fees) of any nature related to or arising out of your
                    activities as an agent, employee, officer or director of the
                    Company or in any other capacity on behalf of or at the
                    request of the Company, the Corporation shall promptly on
                    written request, indemnify (and advance expenses to) you to
                    the fullest extent permitted by applicable law, including
                    but not limited to making such findings and determinations
                    and taking any and all such actions as the Corporation may,
                    under applicable law, be permitted to have the discretion to
                    take so as to effectuate such indemnification or
                    advancement. Such agreement by the Corporation shall not be
                    deemed to impair any other obligation of the Corporation
                    respecting your indemnification otherwise arising out of
                    this or any other agreement or promise of the Corporation or
                    under any statute; and

                              (viii) if by reason of Section 280G of the Code
                    any payment or benefit received or to be received by you in
                    connection with a Change in Control or the termination of
                    your employment (whether payable pursuant to the terms of
                    this Agreement ("Contract Payments") or any other plan,
                    arrangements or agreement with the Corporation or an
                    Affiliate (as defined below) (collectively with the Contract
                    Payments, "Total Payments")) would not be deductible (in
                    whole or part) by the Corporation, an Affiliate or other
                    person making such

                                       9
<PAGE>

               payment or providing such benefit, then the Severance Payment
               shall be reduced (to zero if necessary) and, if the Severance
               Payment is reduced to zero, other Contract Payments shall be
               reduced (to zero if necessary) and, if Contract Payments are
               reduced to zero, other Total Payments shall be reduced (to zero
               if necessary) until no portion of the Total Payments is not
               deductible by reason of Section 280G of the Code. For purposes of
               this limitation, (a) no portion of the Total Payments the receipt
               or enjoyment of which you shall have effectively waived in
               writing prior to the date of payment of the Severance Payment
               shall be taken into account; (b) no portion of the Total Payments
               shall be taken into account which in the opinion of tax counsel
               selected by the Corporation's independent auditors and acceptable
               to you does not constitute a "parachute payment" within the
               meaning of Section 280G(b)(2) of the Code (without regard to
               subsection (A)(ii) thereof); (c) the Severance Payment (and,
               thereafter, other Contract Payments and other Total Payments)
               shall be reduced only to the extent necessary so that the Total
               Payments in their entirety constitute reasonable compensation for
               services actually rendered within the meaning of Section
               280G(b)(4) of the Code, in the opinion of the tax counsel
               referred to in clause (b); and (d) the value of any non-cash
               benefit or any deferred payment or benefit included in the Total
               Payments shall be determined by the Corporation's independent
               auditors in accordance with the principles of Sections 280G(d)(3)
               and (4) of the Code. For purposes of this Section 5(c)(viii), the
               term "Affiliate" means the Corporation's successors, any Person
               whose actions result in a Change in Control or any corporation
               affiliated (or which, as a result of the completion of the
               transactions causing a Change in Control shall become affiliated)
               with the Corporation within the meaning of Section 1504 of the
               Code.

               (d)  If your employment by the Company shall be terminated by you
pursuant to a Covered Resignation, then you shall be entitled to the benefits
provided for in Section 5(c) except that (i) the severance benefits provided in
Section 5(c)(ii) shall be fifty percent (50%) of benefit provided therein, and
(ii) the medical and dental benefits provided in Section 5(c)(iii) shall be for
a maximum period of six (6) months.

               (e)  The payments provided for in Sections 5(c)(i), (ii),
(iii) and 5(d) shall be made not later than the fifth day following the Date of
Termination; provided, however, that if the amounts of such payments cannot be
finally determined on or before such day, the Corporation shall pay to you on
such day an estimate, as determined in good faith by the Corporation, of the
minimum amount of such payments and shall pay the remainder of such payments
(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
the thirtieth day after the Date of Termination. In the event that the amount of
the estimated payments exceeds the amount subsequently determined to have been
due, such excess shall constitute a loan by the Corporation

                                       10
<PAGE>

to you, payable on the fifth day after demand by the Corporation (together with
interest at the rate provided in Section 1274(b)(2)(B) of the Code).

          (f)  You shall not be required to mitigate the amount of any payment
provided for in this Section 5 by seeking other employment or otherwise nor,
except as provided in Section 5(c)(iii), shall the amount of any payment
or benefit provided for in this Section 5 be reduced by any compensation earned
by you as the result of employment by another employer or self-employment, by
retirement benefits, by offset against any amount claimed to be owed by you to
the Corporation, or otherwise.

          6.   Successors; Binding Agreement.
               ------------------------------

          (a)  The Corporation shall require any successor (whether direct or
indirect, by purchase, merger, consolidation or otherwise) to all or
substantially all of the business and/or assets of the Corporation to expressly
assume and agree to perform this Agreement in the same manner and to the same
extent that the Corporation would be required to perform it if no such
succession had taken place. Failure of the Corporation to obtain such assumption
and agreement prior to the effectiveness of any such succession shall be a
breach of this Agreement and shall entitle you to terminate your employment and
receive compensation from the Corporation in the same amount and on the same
terms to which you would be entitled hereunder if you terminate your employment
for Good Reason following a Change in Control, except that for purposes of
implementing the foregoing, the date on which any such succession becomes
effective shall be deemed the Date of Termination. Unless expressly provided
otherwise, "Corporation" as used herein shall mean the Corporation as defined in
this Agreement and any successor to its business and/or assets as aforesaid.

          (b)  This Agreement shall inure to the benefit of and be enforceable
by you and your personal or legal representatives, executors, administrators,
successors, heirs, distributees, devisees and legatees. If you should die while
any amount would still be payable to you hereunder had you continued to live,
all such amounts, unless otherwise provided herein, shall be paid in accordance
with the terms of this Agreement to your devisee, legatee or other designee or,
if there is no such designee, to your estate.

          7.   Notice. For the purpose of this Agreement, notices and all other
               ------
communications provided for in this Agreement shall be in writing and shall be
deemed to have been duly given when delivered or mailed by United States
certified or registered mail, return receipt requested, postage prepaid,
addressed to the respective addresses set forth on the first page of this
Agreement, provided that all notices to the Corporation shall be directed to the
attention of the Board with a copy to the Secretary of the Corporation, or to
such other address as either party may have furnished to the other in writing in
accordance herewith, except that notice of change of address shall be effective
only upon receipt.

          8.   Confidentiality and Non-Solicitation Covenants.
               ----------------------------------------------

                                       11
<PAGE>

          (a)  Confidentiality. You hereby agree that commencing on the Date of
               ---------------
Termination, you shall not, directly or indirectly, disclose or make available
to any person, firm, corporation, association or other entity for any reason or
purpose whatsoever, any Confidential Information (as defined below). You agree
that, upon termination of your employment with the Company, all Confidential
Information in your possession that is in written or other tangible form
(together with all copies or duplicates thereof, including computer files) shall
be returned to the Corporation and shall not be retained by you or furnished to
any third party, in any form except as provided herein; provided, however, that
you shall not be obligated to treat as confidential, or return to the
Corporation copies of any Confidential Information that (i) was publicly known
at the time of disclosure to you, (ii) becomes publicly known or available
thereafter other than by any means in violation of this Agreement or any other
duty owed to the Company by any person or entity, or (iii) is lawfully disclosed
to you by a third party. As used in this Agreement, the term "Confidential
Information" means: information disclosed to you or known by you as a
consequence of or through your relationship with the Company, about the
customers, employees, business methods, public relations methods, organization,
procedures or finances, including, without limitation, information of or
relating to customer lists, of the Company.

          (b)  Non-Solicitation. You hereby agree that, for the period
               ----------------
commencing on the Date of Termination and terminating on the first anniversary
thereof, you shall not, either on your own account or jointly with or as a
manager, agent, officer, employee, consultant, partner, joint venturer, owner or
shareholder or otherwise on behalf of any other person, firm or corporation,
directly or indirectly solicit or attempt to solicit away from the Company any
of its officers or employees or offer employment to any person who, on or during
the six (6) months immediately preceding the date of such solicitation or offer,
is or was an officer or employee of the Company; provided, however, that a
general advertisement to which an employee of the Company responds shall in no
event be deemed to result in a breach of this Section 8(b).

          9.   Governing Law. The validity, interpretation, construction and
               -------------
performance of this Agreement shall be governed on a non-exclusive basis by the
laws of the State of California without giving effect to its conflicts of laws
rules.

          10.  Joint and Several Liability. Any successors or assigns shall be
               ---------------------------
jointly and severally liable with the Corporation under this Agreement.

          11.  Miscellaneous. No provision of this Agreement may be modified,
               -------------
waived or discharged unless such waiver, modification or discharge is agreed to
in writing and signed by you and such officer as may be specifically designated
by the Board. No waiver by either party hereto at any time of any breach by the
other party hereto of or compliance with, any condition or provision of this
Agreement to be performed by such other party shall be deemed a waiver of
similar or dissimilar provisions or conditions at the same or at any prior or
subsequent time. No agreements or representations, oral or otherwise, express or
implied, with respect to the subject matter hereof have been made by either
party which are not expressly set forth in this Agreement.

                                       12
<PAGE>

All references to sections of the Exchange Act or the Code shall be deemed also
to refer to any successor provisions to such sections. Any payments provided for
hereunder shall be paid net of any applicable withholding required under
federal, state or local law. Any obligations of the Corporation under Sections 5
and 6 shall survive the expiration of the term of this Agreement. The section
headings contained in this Agreement are for convenience only, and shall not
affect the interpretation of this Agreement.

          12.  Severability. The invalidity or unenforceability of any provision
               ------------
of this Agreement shall not affect the validity or enforceability of any other
provision of this Agreement, which shall remain in full force and effect.

          13.  Counterparts. This Agreement may be executed in several
               ------------
counterparts, each of which shall be deemed to be an original but all of which
together shall constitute one and the same instrument.

          14.  Arbitration; Dispute Resolution, Etc.
               ------------------------------------

          (a)  Arbitration Procedure. Any disagreement, dispute, controversy or
               ---------------------
claim arising out of or relating to this Agreement or the interpretation of this
Agreement or any arrangements relating to this Agreement or contemplated in this
Agreement or the breach, termination or invalidity thereof shall be settled by
final and binding arbitration administered by the JAMS/Endispute in Los Angeles,
California in accordance with its then existing JAMS/Endispute Arbitration Rules
and Procedures for Employment Disputes. In the event of such an arbitration
proceeding, you and the Corporation shall select a mutually acceptable neutral
arbitrator from among the JAMS/Endispute panel of arbitrators. In the event you
and the Corporation cannot agree on an arbitrator, the Administrator of
JAMS/Endispute will appoint an arbitrator. Neither you nor the Corporation nor
the arbitrator shall disclose the existence, content, or results of any
arbitration hereunder without the prior written consent of all parties. Except
as provided herein, the Federal Arbitration Act shall govern the interpretation,
enforcement and all proceedings under this Section 14. The arbitrator shall
apply the substantive law (and the law of remedies, if applicable) of the State
of California, or federal law, or both, as applicable and the arbitrator is
without jurisdiction to apply any different substantive law. The arbitrator
shall have the authority to entertain a motion to dismiss and/or a motion for
summary judgment by any party and shall apply the standards governing such
motions under the Federal Rules of Civil Procedure. The arbitrator shall render
an award and a written, reasoned opinion in support thereof. Judgment upon the
award may be entered in any court having jurisdiction thereof. For purposes of
jurisdiction and venue, the Corporation hereby consents to jurisdiction and
venue in any suit, action or proceeding with respect to this Agreement in any
court of competent jurisdiction in the state in which you reside at the
commencement of such suit, action or proceeding and waives any objection,
challenge or dispute as to such jurisdiction or venue being proper. The
Corporation shall pay all fees and expenses of the Arbitrator regardless of the
result and shall provide all witnesses and evidence reasonably required by you
to present your case.

                                       13
<PAGE>

          (b)  Compensation During Dispute, Etc. Your compensation during any
               ---------------------------------
disagreement, dispute, controversy, claim, suit, action or proceeding
(collectively, a "Dispute") arising out of or relating to this Agreement or the
interpretation of this Agreement shall be as follows. If there is a termination
of your employment with the Company after a Change in Control followed by a
Dispute as to whether you are entitled to the payments and other benefits
provided under this Agreement, then, during the period of that Dispute the
Corporation shall pay you fifty percent (50%) of the amount specified in
Sections 5(c)(i) and 5(c)(ii) hereof, and the Corporation shall provide you with
the other benefits provided in Section 5(c) of this Agreement, if, but only if,
you agree in writing that if the Dispute is resolved against you, you shall
promptly refund to the Corporation all payments you receive under Sections
5(c)(i) and 5(c)(ii) of this Agreement plus interest at the rate provided in
Section 1274(d) of the Code, compounded quarterly. If the Dispute is resolved in
your favor, promptly after resolution of the dispute the Corporation shall pay
you the sum that was withheld during the period of the Dispute plus interest at
the rate provided in Section 1274(d) of the Code, compounded quarterly.

          (c)  Legal Fees. In addition to all other amounts payable to you under
               ----------
this Agreement, the Corporation shall pay to you all legal fees and expenses
incurred by you in connection with any Dispute arising out of or relating to
this Agreement or the interpretation thereof (including, without limitation, all
such fees and expenses, if any, incurred in contesting or disputing any
termination of your employment or in seeking to obtain or enforce any right or
benefit provided by this Agreement, or in connection with any tax audit or
proceeding to the extent attributable to the application of Section 4999 of the
Code to any payment or benefit provided hereunder), regardless of the outcome of
such proceeding; provided, however, that in the event you commence such action,
you shall not be entitled to recover such fees and costs if the court determines
that you brought the claim in bad faith or the claim was frivolous. Any
attorney's fees incurred by you shall be paid by the Corporation in advance of
the final disposition of such action or challenge, as such fees and expenses are
incurred; provided, however, that you agree to repay such amounts, net of any
income taxes paid or payable by you with respect to such amounts, if such
amounts are incurred in connection with an action commenced by you if it is
ultimately determined by the court that you brought such action in bad faith or
the claim was frivolous.

          15.  At-Will Employment. Nothing in the foregoing diminishes or alters
               ------------------
the Company's policy of at-will employment for all employees, where both the
Company and you may terminate the employment relationship at any time and for
any reason, with or without cause or notice.

          16.  Entire Agreement. This Agreement sets forth the entire agreement
               ----------------
of the parties hereto in respect of the subject matter contained herein and
supersedes all prior agreements, promises, covenants, arrangements,
communications, representations or warranties, whether oral or written, by any
officer, employee or representative of any party hereto; and any prior agreement
of the parties hereto in respect of the subject matter contained herein,
including,

                                       14
<PAGE>

without limitation, any prior severance agreements, is hereby terminated and
cancelled. Any of your rights hereunder shall be in addition to any rights you
may otherwise have under benefit plans or agreements of the Company to which you
are a party or in which you are a participant, including, but not limited to,
any Company sponsored employee benefit plans and stock options plans. Provisions
of this Agreement shall not in any way abrogate your rights under such other
plans and agreements.

          If this letter sets forth our agreement on the subject matter hereof,
kindly sign and return to the Corporation the enclosed copy of this letter,
which shall then constitute our agreement on this subject.

                                            Sincerely,

                                            SCPIE HOLDINGS INC.

                                            By: ______________________________

                                            Its:______________________________

Agreed to this __ day
of December, 2000.

___________________________
[Executive]

                                       15

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