The Hartford 2010 Annual Report Download - page 123

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Changes in internal control over financial reporting
There were no changes in the Company's internal control over financial reporting that occurred during the Company's fourth fiscal
quarter of 2010 that have materially affected, or are reasonably likely to materially affect, the Company's internal control over financial
reporting.
Item 9B. OTHER INFORMATION
On February 22, 2011 (the “Effective Date”), The Hartford Financial Services Group, Inc. (“The Hartford”) adopted The Hartford
Senior Executive Officer Severance Pay Plan (the “Tier 1 Plan”), providing for specified payments and benefits to participants upon
termination of employment as a result of severance eligible events. The Tier 1 Plan applies to such of The Hartford’ s Tier 1 executive
officers, including named executive officers, as the Executive Vice President, Human Resources (the “Plan Administrator”) has
approved for participation in the Plan and who are otherwise eligible, as described below. Liam E. McGee, Chairman, President and
Chief Executive Officer, and Christopher J. Swift, Executive Vice President and Chief Financial Officer, will participate in the Tier 1
Plan as of the Effective Date. The Hartford’ s other named executive officers, Lizabeth H. Zlatkus, Executive Vice President and Chief
Risk Officer, Alan J. Kreczko, Executive Vice President and General Counsel, and Gregory G. McGreevey, Executive Vice President
and Chief Investment Officer, are anticipated to participate in the Tier 1 Plan after their current individual employment agreements
expire (May 1, 2012, June 7, 2012 and October 8, 2011, respectively), provided that they then meet the conditions set forth below.
The Tier 1 Plan provides benefits to Tier 1 executives who the Plan Administrator has approved for participation in the Plan and who
have agreed to such non-competition, non-solicitation, non-disparagement and other restrictive covenants as are required by the Plan
Administrator. The Plan does not apply to an executive who is party to an individual employment agreement that provides for the
payment of severance pay. (The Company has ceased the practice of entering into such individual employment agreements.)
A participant is generally eligible for severance pay under the Tier 1 Plan if (1) the Company terminates the employee’ s employment;
and (2) the employee signs a Separation and Release Agreement, unless:
• termination is for misconduct or other disciplinary action;
• the employee is under investigation for misconduct at the time severance would be due;
• the employee refuses a “Comparable Position” defined as a position (i) with materially the same base salary rate and annual
incentive opportunity, (ii) with similar duties or having different duties that, in management’ s judgment, the employee is able to
perform and are consistent with the employee’ s experience, and (iii) that is located within a 50 miles radius of the employee’ s
previous place of employment or does not entail a substantially longer commute from home;
• in connection with a sale, divestiture or outsourcing that is not deemed a change of control, the employee accepts employment or
continued employment with the buyer or vendor, declines an interview or an invitation to apply for a Comparable Position with the
buyer or vendor, or is offered a Comparable Position; or
• the employee’ s employment terminates due to mandatory retirement at or after the employee has attained his/her 65th birthday,
subject to applicable law.
A participating Tier 1 executive will receive severance pay in an amount equal to two times the sum of the executive’ s annual base
salary plus the target annual bonus, both determined as of the termination date. The severance pay will be payable in a lump sum within
60 days of termination. In addition, a Tier 1 executive will be eligible to receive a pro-rata annual bonus under the Company’ s annual
incentive plan for the year in which the termination occurs, payable no later than the March 15 following the calendar year of
termination. The participating executive will also vest pro-rata in any outstanding unvested long term incentive awards, unless
prohibited by applicable law, provided that at least one full year of the performance or restriction period of the applicable award has
elapsed as of the termination date.
The Tier 1 Plan provides for continued medical and dental coverage and outplacement services for up to twelve months.
If, within the two year period following a Change of Control (as defined in the Company’ s 2010 Incentive Stock Plan), (1) a participant
is involuntarily terminated by the Company other than for cause, or (2) the participant voluntarily terminates employment with the
Company for Good Reason (as defined below), then the participant will receive the same severance pay, and will be eligible for a pro-
rata annual bonus as set forth above, except that the pro-rata annual bonus payable will be at least the same percentage of the target level
of payout as is generally applicable to executives whose employment did not terminate. In addition, as provided in the 2010 Incentive
Stock Plan, any outstanding unvested long term incentive awards will be fully vested upon a Change of Control. No gross-up is
provided for any excise taxes that apply to a participant. Following a Change of Control, the term “Company” includes The Hartford,
Hartford Fire Insurance Company or any successor in interest to either of these entities and any affiliate of such a successor. Good
Reason means:
• the assignment of duties inconsistent in any material adverse respect with the executive’ s position, duties, authority or
responsibilities, or any other material adverse change in position, including titles, authority or responsibilities;
• a material reduction in base pay or target bonus;
• being based at any office or location more than 50 miles from the location at which services were performed immediately prior to
the Change of Control (provided that such change of office or location also entails a substantially longer commute);
• a failure by the Company to obtain the assumption and agreement to perform the provisions of the Plan by a successor; or
• a termination asserted by the Company to be for cause that is subsequently determined not to constitute a termination for cause.