EMPLOYMENT AGREEMENT -------------------- AGREEMENT made as of December 31, 1993, by and between The Travelers Insurance Group Inc., a Connecticut corporation (the "Company") and ROBERT W. CRISPIN (the "Executive"). The Company desires to employ the Executive, and the Executive is willing to serve the Company, on the terms and conditions herein provided. In order to effect the foregoing, the parties hereto wish to enter into an employment agreement on the terms and conditions set forth below. Accordingly, in consideration of the premises and the respective covenants and agreements of the parties herein contained, and intending to be legally bound hereby, the parties hereto agree as follows: 1. Employment. The Company hereby agrees to employ the ---------- Executive, and the Executive hereby agrees to serve the Company, on the terms and conditions set forth herein. 2. Term. The employment of the Executive by the Company ---- as provided in Section 1 shall commence on the effective date of the proposed merger between Primerica Corporation and The Travelers Corporation (the parent company of the Company) ("Travelers") presently expected to be on or about December 31, 1993 (the "Commencement Date"). The term of this Agreement shall expire on the third 1 <PAGE> anniversary of the Commencement Date unless prior to such date this Agreement shall be extended by written agreement of the parties. 3. Positions and Duties; Location. The Executive shall -------------------------------- have the title of Vice Chairman of the Company and shall serve as a senior executive of the Company with such responsibilities, duties and authorities consistent with his status as a senior executive of the Company as may from time to time be assigned to the Executive by the Chief Executive Officer of the Company. During the term of this Agreement, the Executive shall devote substantially all his time and best efforts during normal business hours to the business and affairs of the Company except for vacations, illness or incapacity, but nothing in this Agreement shall preclude the Executive from devoting reasonable periods required for (i) serving as a director or member of a committee of any not-for-profit organization or, with the prior approval of the Chief Executive Officer of the Company, any for-profit organization, in each case involving no conflict of interest with the Company, (ii) delivering lectures and fulfilling speaking engagements, and (iii) engaging in charitable and community activities provided that any of such activities do not materially interfere with the performance of his duties hereunder. 2 <PAGE> 4. Compensation and Related Matters. --------------------------------- (a) Salary and Bonus. During the period of ----------------- the Executive's employment hereunder, the Company shall continue to pay to the Executive a base salary at the rate in effect on the date hereof, such salary to be paid in accordance with the Company's normal payment schedule. The Executive will participate in the Company's discretionary annual bonus program and shall be eligible for discretionary review of base salary in accordance with Company practice, in each case as may be in effect from time to time. Effective beginning with compensation payable with respect to 1994, the Executive shall also participate in the Primerica Corporation Capital Accumulation Plan, as in effect from time to time. During any period that the Executive fails to perform his duties hereunder as a result of incapacity due to physical or mental illness ("disability period"), the Executive shall continue to receive his full base salary until his employment is terminated pursuant to Section 5(b) hereof, provided that payments so made to the Executive during such 3 <PAGE> period shall be reduced by the sum of the amounts, if any, payable to the Executive under disability benefit plans of the Company or under the Social Security disability insurance program. (b) Expenses. During the term of the --------- Executive's employment hereunder, the Executive shall be entitled to receive prompt reimbursement for all reasonable and customary expenses incurred by the Executive in performing services hereunder, including all expenses of travel and living expenses while away from home on business or at the request of and in the service of the Company, provided that such expenses are incurred and accounted for in accordance with the policies and procedures established by the Company. (c) Other Benefits. The Executive shall be --------------- entitled to participate in all of the employee benefit plans and arrangements generally available to senior executives of the Company. During your first five years of employment (commencing July, 1991) you will receive two years of pension credit for each completed year of service. 4 <PAGE> (d) Stock Options; Restricted Stock. The ---------------------------------- Executive has previously received awards of stock options and/or restricted stock. Such prior awards shall be governed by the provisions of the plans under which such awards were granted, including the provisions of the offer made or to be made by Primerica Corporation to holders of Company stock options providing, in general, for the conversion of existing stock options of The Travelers Corporation into Primerica Corporation stock options, as described in the prospectus supplement covering such offer and delivered separately (the "Roll-Over Offer"). The Executive hereby elects to participate fully in the Roll-Over Offer. Treatment of unvested stock options in the event of an involuntary termination of employment shall be treated as set forth in the Roll-Over Offer. If the Executive should terminate his employment for "Cause" under Section 5 (e), such termination shall be treated as a termination without "Cause" under the Roll-Over Offer. Treatment of unvested stock options in the event of a voluntary termination of employment shall be treated as set forth in the Roll-Over Offer, as modified by Attachment A hereto. 5 <PAGE> 5. Termination. The Executive's employment hereunder may ------------ be terminated under the following circumstances: (a) Death. The Executive's employment ------ hereunder shall terminate upon his death. (b) Disability. If, as a result of the ----------- Executive's incapacity due to physical or mental illness, the Executive shall have been absent from his duties hereunder on a full- time basis for the entire period of six (6) consecutive months, the Company may terminate the Executive's employment hereunder on thirty (30) days' written notice of termination (which may be given before or after the end of such six (6) month period), unless the Executive shall have returned to the performance of his duties hereunder on a full-time basis before the later of the thirtieth (30th) day after such notice is given or the last day of such six (6) month period. (c) Cause. The Company may terminate the ------ Executive's employment hereunder for Cause. For purposes of this Agreement, the Company shall have "Cause" to terminate the Executive's employment hereunder (i) upon the 6 <PAGE> Executive's willful refusal to perform his duties; (ii) if the Executive has entered into unlawful acts to enrich the Executive at the Company's expense or has materially violated his duties to the Company, in either case with resulting material injury to the Company; or (iii) upon the Executive's gross misconduct that is demonstrably detrimental to the Company, provided, that a termination under clause (i) by reason of the Executive's willful refusal to perform his duties shall only be effective upon the Company's written notice of termination to the Executive and failure of the Executive to remedy such refusal promptly. (d) Without Cause. The Company may ---------------- terminate the Executive's employment hereunder without Cause provided that any such termination shall be subject to the express provisions of Section 6(c) hereof. (e) By The Executive. The Executive may ------------------ resign from employment hereunder but subject to the express provisions of Section 7 hereof. The Executive may terminate this Agreement for "Cause". For purposes of this Agreement, the Executive shall have "Cause" 7 <PAGE> to terminate this Agreement upon a material breach of this Agreement by the Company, (including without limitation a reduction in his base salary without his consent.) Such termination for "Cause" shall only be effective upon the Executive's written notice of termination to the Company and the failure of the Company to remedy such breach promptly. (f) Any termination of the Executive's employment by the Company or by the Executive (other than termination pursuant to subsection (a) hereof) shall be communicated by written Notice of Termination to the other party hereto in accordance with Section 8. For purposes of this Agreement, a "Notice of Termination" shall mean a notice which shall indicate the specific termination provision in this Agreement relied upon and, except in the case of a voluntary resignation, shall set forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of the Executive's employment under the provision so indicated. (g) "Date of Termination" shall mean (i) if the Executive's employment is terminated by 8 <PAGE> his death, the date of his death, (ii) if the Executive's employment is terminated for disability pursuant to subsection (b) above, the later of the thirtieth (30th) day after Notice of Termination or the last day of the 6-month period referred to in subsection (b) (provided that the Executive shall not have returned to the performance of his duties on a full-time basis before such later day), (iii) if the Executive's employment is terminated pursuant to subsection (c) above, the later of the date such termination becomes effective under subsection (c) and the date specified in the Notice of Termination, (iv) if the Executive's employment is terminated pursuant to subsection (e) above, the later of the date such termination becomes effective under subsection (e) and the date specified in the Notice of Termination, and (v) if the Executive's employment is terminated for any other reason, the date on which a Notice of Termination is given. Termination of employment shall be effective on the respective Date of Termination. 6. Compensation Upon Termination. ------------------------------ 9 <PAGE> (a) If the Executive's employment is terminated by his death or on account of his disability, the Company shall pay the full base salary due to the Executive under Section 4 through the Date of Termination together with a discretionary pro rata bonus for the year in which such Date of Termination occurs to the Executive or his estate or as may be directed by his legal representative or the legal representative of such estate. (b) (i) If the Executive's employment is terminated by the Company for Cause or if, during the period after the first anniversary of the Commencement Date, the Executive shall resign from his employment, the Company shall pay the Executive his full base salary through the Date of Termination at the rate in effect at the time Notice of Termination is given (to the extent not already paid) and the Company shall have no further obligations to the Executive under this Agreement. (ii) If the Executive shall resign from his employment prior to the first anniversary of the Commencement Date, the Company shall pay the Executive his full base salary through the Date of Termination at the rate in effect 10 <PAGE> at the time Notice of Termination is given (to the extent not already paid) plus the amount calculated as shown on Attachment A hereto. (c) If the Company shall terminate the Executive's employment without Cause or if the Executive terminates this Agreement for "Cause", the Company shall pay or provide to the Executive the following amounts or benefits: (i) if such termination is effective on or before December 31, 1994, his then current base salary through the remaining term of this Agreement, as and when otherwise due and subject to appropriate tax withholding, together with his bonus for 1994 (such bonus to be equal to his bonus for 1993, subject to appropriate tax withholding, and payable at the time such bonuses are otherwise generally paid to senior executives of the Company for the year 1994); or (ii) if such termination is effective 11 <PAGE> after December 31, 1994, his then current base salary, as and when otherwise due and subject to appropriate tax withholding, through the remaining term of this Agreement; and (iii) reasonably appropriate executive outplacement services; (iv) reimbursement of up to $7500 of tax and other financial planning services expenses for the year in which such Date of Termination occurs; (v) continued participation in Company employee medical plans on terms and conditions and at costs generally available from time to time to Company employees for one year following the Date of Termination; (vi) additional service credit for purposes of vesting and benefit determination under the Pension Plan for Salaried Employees of the Company (The "Pension Plan") such that the total of his actual and credited service is ten (10) years; and (vii) vesting in his Company 12 <PAGE> Contributions Account and ESOP Account under the Company Savings, Investment and Stock Option Plan (TESIP). (d) The provisions of Section XI of The Travelers Severance Plan for Officers (entitled "Certain Additional Payments By the Company") shall apply with respect to all payments, benefits, awards and distributions by the Company, Primerica, Travelers and/or any of their respective affiliates to or for the benefit of the Executive, whether pursuant to this Agreement or otherwise. To the extent the additional service credit referred to in Section 4(c) or in clause (vi) above may not be taken into account for purposes of the Pension Plan, or the vesting referred to in clause (vii) above is not permitted under the TESIP, the Company shall pay the additional amounts that would have been payable to the Executive or his beneficiary under the Pension Plan and the TESIP if such additional service credit had been taken into account and such vesting had been permitted, in the time and manner that such amounts would otherwise have been paid 13 <PAGE> under such plans. The payments required by the preceding sentence may be made through a nonqualified "top hat" plan. (e) The provisions of this Section 6 are the exclusive rights of the Executive regarding severance or termination and the Executive agrees that such provisions shall be in full satisfaction of any claims the Executive may have as a result of such termination of employment. 7. Confidentiality. During the term of this Agreement and --------------- thereafter, the Executive will not except (i) pursuant to and in the ordinary course of his employment by the Company or, (ii) with the written consent of the Company, make use of or divulge to any person, firm or corporation, any confidential business information of the Company, its affiliates or customers. The provisions of this Section 7 shall survive the termination, for any reason, of this Agreement. In the event the Executive's employment hereunder is terminated for any reason, whether by the Company or the Executive, the Executive shall not for a period of one year following the Date of Termination, without the Company's prior written consent, be personally involved in soliciting or otherwise inducing any employee or agent of the Company or any of its affiliates to 14 <PAGE> terminate or reduce such relationship. 8. Notice. For the purpose of this Agreement, notices, ------- demands and all other communications provided for in this Agreement shall be in writing and shall be deemed to have been duly given when personally delivered as follows delivered to or when mailed by United States certified or registered mail, return receipt requested, postage prepaid, addressed as follows: If to the Executive: Robert W. Crispin The Travelers Insurance Group Inc. One Tower Square Hartford, CT 06183 If to the Company: The Travelers Insurance Group Inc. One Tower Square Hartford, CT 06183 Attention: Chief Executive Officer or to such other address as either party may have furnished to the other in writing in accordance herewith, except that notices of change of address 15 <PAGE> shall be effective only upon receipt. 9. 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 the Executive and a duly authorized officer of the Company. 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. This Agreement shall be binding on the successors and assigns of the Company. The validity, interpretation, construction and performance of this Agreement shall be governed by the laws of the State of Delaware without regard to its conflicts of law principles. 10. Validity. The invalidity or unenforceability of any --------- provision or provisions 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. 11. Counterparts. This Agreement may be executed in one or ------------- more counterparts, each of which shall be deemed to be an original but all of which together will constitute 16 <PAGE> one and the same instrument. 12. 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 (including without limitation that certain letter agreement dated July 1, 1991), promises, covenants, arrangements, communications, representations or warranties, whether oral or written, by any officer, employee or representative of either party hereto. 17 <PAGE> IN WITNESS WHEREOF, the Parties have executed this Agreement as of the date and year first above written. The Travelers Insurance Group Inc. By: /s/ Robert I. Lipp -------------------------- Name: Robert I. Lipp Title: Chief Executive Officer EXECUTIVE /s/ Robert W. Crispin ------------------------------- Robert W. Crispin Primerica Corporation hereby consents to The Travelers Insurance Group Inc. entering into the foregoing employment agreement. Primerica Corporation By: /s/ Charles O. Prince, III -------------------------- Name: Charles O. Prince, III Title: Senior Vice President and General Counsel Date: ------------------------ 18 <PAGE> Attachment A ROBERT W. CRISPIN Calculation of payment pursuant to Sec.6 (b) (ii). A payment equal to the amount of the "spread" on any stock options of the surviving corporation in the merger between Primerica Corporation and The Travelers Corporation which are at the time of resignation unvested as a result of participation in the Roll-Over Offer and forfeited as a result of such resignation, as such "spread" exists on the Effective Date of the Merger. For these purposes, "spread" is the difference between the closing price of the common stock of The Travelers Corporation on the New York Stock Exchange (Composite Transactions) and the relevant option exercise price. The number of shares to be multiplied by the "spread" and the relevant option price shall be appropriately adjusted by the conversion factor in connection with the Merger but the number of shares shall not include shares scheduled to vest in January 1994 even if the resignation occurs prior to that vesting. 19
Source: OneCLE Business Contracts.