The Hartford 2008 Annual Report Download - page 699

(j) With respect to an Incentive Stock Option, the Committee shall specify such terms and provisions as the Committee
may determine to be necessary or desirable in order to qualify such Option as an “incentive stock option” within the
meaning of Section 422 of the Code.
(k) With respect to the exercisability and settlement of Rights:
(i) Except as expressly provided below, upon exercise of a Right, a Key Employee or Director shall be entitled,
subject to such terms and conditions as the Committee may specify, to receive all or a portion of the excess of (A) the Fair
Market Value of a specified number of shares of Stock at the time of exercise, as determined by the Committee, over (B) a
specified amount which shall not, subject to Section 5(d), be less than the Fair Market Value of such specified number of
shares of Stock at the time the Right is granted. Payment of any such excess shall be made as the Committee shall specify in
cash, the issuance or transfer to the Key Employee or Director of whole shares of Stock with a Fair Market Value at such
time equal to any excess, or a combination of cash and shares of Stock with a combined Fair Market Value at such time
equal to any such excess, all as determined by the Committee. The Company will not issue a fractional share of Stock and, if
a fractional share would otherwise be issuable, the Company shall pay cash equal to the Fair Market Value of the fractional
share of Stock at such time.
(ii) Notwithstanding Section 5(k)(i), the Committee may specify at grant that payment of any excess referenced in
the first sentence of Section 5(k)(i) shall not be paid until a specified date or, if earlier, upon the termination of the Key
Employee’s employment, the cessation of the Director’s service on the Board or, subject to Section 9(c)(vi), a Change of
Control. To the extent permissible without adverse tax consequences for the Key Employee or Director, the Committee may
permit the Key Employee or Director to elect when such payment is made. Amounts, if any, deferred pursuant to this
Section 5(k)(ii) shall be subject to such terms and conditions as the Committee shall determine, including the manner in
which any deemed earnings on such deferred amounts shall be determined.
(iii) In the event of the exercise of such Right, the Company’s obligation in respect of any related Option or such
portion thereof will be discharged by payment of the Right so exercised.
Source: HARTFORD FINANCIAL S, 10-K, February 12, 2009