HANOVER INSURANCE GROUP, INC.

Transcription

1 HANOVER INSURANCE GROUP, INC. FORM 8-K (Current report filing) Filed 01/08/10 for the Period Ending 01/06/10 Address 440 LINCOLN ST WORCESTER, MA, Telephone CIK Symbol THG SIC Code Fire, Marine and Casualty Insurance Industry Property & Casualty Insurance Sector Financials Fiscal Year 12/31 Copyright 2018, EDGAR Online, a division of Donnelley Financial Solutions. All Rights Reserved. Distribution and use of this document restricted under EDGAR Online, a division of Donnelley Financial Solutions, Terms of Use.

2 UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D.C FORM 8-K CURRENT REPORT Pursuant to Section 13 or 15(d) of The Securities Exchange Act of 1934 Date of Report (Date of earliest event reported): January 6, 2010 THE HANOVER INSURANCE GROUP, INC. (Exact name of registrant as specified in its charter) Delaware (State or other jurisdiction (Commission File Number) (I.R.S.Employer of incorporation) Identification No.) 440 Lincoln Street, Worcester, Massachusetts (Address of principal executive offices) (Zip Code) Registrant s telephone number, including area code: (508) Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions: Written communications pursuant to Rule 425 under the Securities Act (17 CFR ) Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR a-12) Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR d-2(b)) Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR e-4(c))

3 Item Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers. Appointment of Steven J. Bensinger On January 6, 2010, Steven J. Bensinger, 54, joined The Hanover Insurance Group, Inc. (the Company ) as its Executive Vice President Senior Finance Officer. It is expected that Mr. Bensinger will assume the position of Chief Financial Officer effective March 12, Upon assumption of the role of Chief Financial Officer, Mr. Bensinger will serve as the Company s principal financial and accounting officer. Mr. Bensinger began his career in 1976 with the accounting firm then known as Coopers & Lybrand, where he rose to partner in the firm s financial services practice. From 1987 until 1992, Mr. Bensinger worked for Skandia America Corporation, initially serving as its Senior Vice President and Chief Financial Officer, and later as its President and Chief Operating Officer. From 1993 until 2002, Mr. Bensinger held senior leadership positions at Chartwell Re Corporation, Trenwick Group Ltd., and Combined Specialty Group, Inc. Mr. Bensinger joined American International Group, Inc. as its Vice President and Treasurer in From 2005 until 2008, Mr. Bensinger served as Executive Vice President and Chief Financial Officer of American International Group. During 2008, Mr. Bensinger also served as American International Group s Vice Chairman-Financial Services and Chief Financial Officer. The Company and Mr. Bensinger entered into an Offer Letter dated January 5, 2010, the material terms of which are as follows: Mr. Bensinger s initial base salary will be $540,000 per year. Effective upon his date of hire, Mr. Bensinger was granted the following equity awards under the Company s 2006 Long-Term Incentive Plan: An option to purchase 40,000 shares of the Company s Common Stock with an exercise price of $44.62 per share. The exercise price of such option equaled the closing price per share of the Company s Common Stock as reported on the New York Stock Exchange on his date of hire. Such option has a ten year term and will (assuming Mr. Bensinger remains continuously employed by the Company through such dates) vest over a four year period: 50% on the third anniversary of his hire date and 50% on the fourth anniversary of his hire date. 5,500 restricted stock units. Such restricted stock units will vest (assuming Mr. Bensinger remains continuously employed by the Company through such dates), and convert into an equivalent number of shares of common stock, over a four year period: 50% on the third anniversary of his hire date and 50% on the fourth anniversary of his hire date. Mr. Bensinger will be granted 5,500 performance-based restricted stock units pursuant to Company s 2010 Long-Term Incentive Program ( 2010 LTIP ) applicable to other executive officers of the Company. The terms and the grant date for 2010 LTIP awards, including Mr. Bensinger s award, will be determined by the Compensation Committee during the first quarter of Mr. Bensinger s 2010 Short-Term Incentive Compensation Award will have a targeted value of 90% of his base salary. Mr. Bensinger will participate in the Company s Amended and Restated Employment Continuity Plan (previously filed as Exhibit 10.2 to the Company s Quarterly Report on Form 10-Q filed with the Commission on August 11, 2008) as an Executive Tier Participant with a 3X Multiplier. Mr. Bensinger received a $200,000 sign-on bonus. In the event Mr. Bensinger voluntarily leaves the Company or is terminated for cause within 36 months of his date of hire, such sign-on bonus must be repaid to the Company. Mr. Bensinger will be eligible to participate in the Company s benefit programs, including, but not limited to, The Hanover Insurance Group Relocation Program, Group Medical, Dental, Life, Short and Long-Term Disability Insurance, The Hanover Insurance Group Retirement Savings Plan (Qualified 401(k) Plan and Nonqualified Retirement Savings Plan) and financial planning services. The foregoing description of the terms of the Offer Letter does not purport to be complete and is qualified in its entirety by the Offer Letter attached hereto as Exhibit 10.1 and incorporated herein by reference.

4 Retirement of Eugene M. Bullis Separately, Eugene M. Bullis plans to retire from the Company on May 10, 2010 and formally resign from his position as Chief Financial Officer on March 12, A copy of the press release announcing the Mr. Bensinger s appointment and Mr. Bullis s retirement is attached as Exhibit 99.1 to this Current Report on Form 8-K. Item 9.01 Financial Statements and Exhibits (a) Not applicable. (b) Not applicable. (c) Not applicable. (d) Exhibits The following exhibits are furnished herewith: Exhibit 10.1 Offer Letter dated January 5, 2010 between Steven J. Bensinger and The Hanover Insurance Group, Inc. Exhibit 99.1 Press release dated January 6,

5 SIGNATURES Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized. The Hanover Insurance Group, Inc. (Registrant) Date: January 8, 2010 By: /s/ J. Kendall Huber J. Kendall Huber Senior Vice President, General Counsel and Asst. Secretary 4

6 Exhibit Index Exhibit 10.1 Offer Letter dated January 5, 2010 between Steven J. Bensinger and The Hanover Insurance Group, Inc. Exhibit 99.1 Press release dated January 6,

7 Exhibit 10.1 January 5, 2010 Mr. Steven J. Bensinger Dear Steve, I am pleased to confirm the details of our offer of employment to join The Hanover Insurance Group, Inc. ( THG or the Hanover ). As we discussed, you would join the Hanover on Wednesday, January 6, 2010, initially with the title Executive Vice President- Senior Finance Officer, reporting to Frederick H. Eppinger, President and Chief Executive Officer of THG. You would have such duties and responsibilities as shall be assigned to you by Mr. Eppinger. Our expectation is that Mr. Eugene Bullis would continue as Chief Financial Officer and Principal Accounting Officer until March 12, At that time, you would assume the responsibilities and title of Chief Financial Officer and the responsibilities of Principal Accounting Officer. The material terms and conditions of this offer letter are contingent upon approval from the Compensation Committee of the Board of Directors for which we have received approval. The offer is also contingent upon a satisfactory reference and background check which has been completed based on your prior written authorization. The terms of your employment are as follows: 1. Effective on your first day, your salary will be payable in biweekly installments of approximately $20,769.23, which annualizes to $540,000. Our current performance management practices include annual performance reviews with performance measures which include predetermined goals. Salaries for senior officers are generally reviewed every months. 2. You will participate in the 2010 Annual Short-Term Incentive Compensation Program (IC) at a target of 90% of your 2010 yearend base salary; you will have the potential to earn up to 2x this target award. The target financial goals will be established by the Compensation Committee in February in accordance with The Hanover Insurance Group, Inc Short-Term Incentive Compensation Plan. Any IC payment is contingent upon you being employed at The Hanover Insurance Group, Inc. at the time the payment is made and is otherwise subject to the terms and conditions of the program. 3. In conjunction with your commencement of employment with THG, you will be granted equity awards with an aggregate targeted value of approximately $1,000,000, as set forth below. The awards will be comprised of a combination of (1) stock options, (2) time-based restricted stock units ( RSUs ) and (3) performance-based restricted stock units ( PBRSUs ). The stock options and RSUs will be granted on your date of hire and will have a grant price based on the closing price of THG shares on such date. We will determine the number of PBRSUs to grant to you based on the closing price of THG shares on that date, but the actual grant of PBRSUs will not occur until such date as the Compensation Committee makes annual grants to other executive officers of THG, which date is expected to be during the week of February 22, The grant of all such equity based awards are subject to approval by the Compensation Committee of the Board of Directors. Such stock options, RSUs and PBRSUs shall be subject to the terms and conditions of The Hanover Insurance Group, Inc Long-Term Incentive Plan, the terms established by the Compensation Committee and the terms and conditions set forth in the applicable grant agreements. 4. You will receive a sign-on bonus of $200,000 (gross), payable as soon as practicable after your date of hire. In the event you voluntarily terminate your employment, or are terminated for cause, prior to the third anniversary of your date of hire, you hereby agree to return such amount in full. As used in this paragraph, the term cause is defined to include, but is not limited to, acts of insubordination, unlawful conduct, misconduct designed to harm the business or reputation of the Hanover, violation of company policy, including its code of conduct, or any conduct (including prior acts) that may be harmful to Hanover s reputation or

8 otherwise may prevent you from effectively conducting your responsibilities as the Company s CFO. 5. You will be eligible to participate in The Hanover Insurance Group s benefit programs, including, but not limited to, Group Medical, Dental, Life, Short and Long Term Disability Insurance, and The Hanover Insurance Group Retirement Savings Plan. Eligibility for and entitlement to benefits are determined by the terms and conditions of the applicable benefit plans. A special attachment includes information on our Nonqualified Retirement Savings Plan, which is available to those employees who may have total compensation (annualized salary and bonuses) in excess of certain statutory limits (currently $245,000 or more). 6. You will be eligible to receive relocation assistance under the current Hanover Insurance Group Relocation program. If your employment with the Hanover is terminated within two years of your hire date under any of the circumstances described in the Relocation Expense Agreement, then you agree to repay all or a portion of the amounts paid under this program pursuant to the terms and conditions of such agreement. A copy of the program is enclosed for your information. In order to receive this benefit, it is required that you sign and return the enclosed Relocation Expense Agreement. 7. You will be eligible to participate in the financial planning program currently available to other senior executives. Additional information will be provided. 8. You will be eligible to earn four (4) weeks vacation annually. 9. Subject to the approval of the Compensation Committee of the Board of Directors, you will also be eligible to participate in The Hanover Insurance Group, Inc. Amended and Restated Employment Continuity Plan (the Change-in-Control Plan ) as an Executive Tier Participant with a 3X Multiplier. 10. As a condition of employment, all employees will be paid through Electronic Funds Transfer (EFT). You may have your pay deposited into as many as four accounts. 11. Under the Federal immigration law, you will be required to complete an I-9 form verifying your employment eligibility in the United States. Refer to the enclosed materials for a list of acceptable forms of documentation. Be sure to bring the appropriate documents with you to New Employee Orientation on your first day of work. 12. This offer letter briefly summarizes some of the terms and conditions of your employment. This letter is not and should not be construed as an employment contract. Employment at the Hanover Insurance Group is at-will. This means that you or the Company can terminate the employment relationship at any time, for any reason or no reason at all, with or without cause or notice. As a condition of your employment, you agree that you will (i) not, directly or indirectly, during the term of your employment with the Hanover, and for a period of one year thereafter, hire, solicit, entice away or in any way interfere with the Hanover s relationship with, any of its officers or employees, or in any way attempt to do so or participate with, assist or encourage a third party to do so, (ii) at all times neither disclose any of the Hanover s confidential or proprietary information to any third party, nor use such information for any purpose other than for the benefit of the Hanover and in accordance with Hanover policy, (iii) not, during the term of your employment with the Hanover, and for a period of one year thereafter, interfere with or seek to interfere with, the Hanover s relationships with any of its policyholders, customers, clients, agents or vendors and (iv) at all times comply with the Hanover s Code of Conduct and other policies and procedures as in effect from time to time. For the purposes of this provision, confidential or proprietary information shall include any information concerning the business, prospects, and goodwill of the Hanover including, by way of illustration and not

9 limitation, all information (whether or not patentable or copyrightable) owned, possessed or used by the Hanover including, without limitation, any agent or vendor information, client information, potential agent or client lists, trade secrets, reports, technical data, computer programs, software documentation, software development, marketing or business plans, unpublished financial information, budgeting/price/cost information or agent, broker, employee or insureds lists or compensation information, except to the extent such information is otherwise legally and publicly available. Please be advised that to the extent you are subject to any employment or contractual obligations to your current or past employer(s), the Hanover expects you to comply with such obligations and to inform the Hanover accordingly. You acknowledge that you have provided the Hanover with copies of any agreement or employment policy, including any code of conduct, that may set forth your continuing obligations to your current or past employer(s), and that you are not aware of any agreement or employment policy that will prevent you from fulfilling your responsibilities to the Hanover. Once again, congratulations Steve! We are truly excited to have you join our team! Please don t hesitate to call me if you have any questions or concerns. Sincerely, /s/ Bryan D. Allen Bryan D. Allen VP Chief HR Officer Signed: /s/ Steven J. Bensinger January 5, 2010 Mr. Steven J. Bensinger Date cc: Frederick H. Eppinger J. Kendall Huber Deborah Mathews Finch

10 Exhibit 99.1 THE HANOVER INSURANCE GROUP NAMES STEVEN J. BENSINGER EXECUTIVE VICE PRESIDENT AND SENIOR FINANCIAL OFFICER - Eugene M. Bullis to Retire as Chief Financial Officer WORCESTER, Mass. (January 6, 2010) The Hanover Insurance Group, Inc. (NYSE: THG) today announced the appointment of Steven J. Bensinger as executive vice president and senior financial officer. Bensinger joined The Hanover today and will be appointed chief financial officer in March, replacing Eugene M. Bullis, who will retire later this year. We are very pleased to have Steve join our team, said Frederick H. Eppinger, chief executive officer at The Hanover. He is an extremely talented and seasoned financial executive with extensive property and casualty experience. We are confident we will benefit from his many years of experience as we continue to position our organization to compete and win over the long term. Bensinger has more than 30 years experience in the financial services business, with most of it in insurance, and in particular, property and casualty insurance. He began his career in 1976 with Coopers & Lybrand, where he rose to partner in the firm s financial services practice. In 1987, he joined Skandia America Corporation as senior vice president and chief financial officer, and later was named president and chief operating officer. Bensinger held senior leadership positions at Chartwell Re Corporation, Trenwick Group Ltd., and Combined Specialty Group, Inc., from 1993 to 2002, before joining American International Group, Inc. as vice president and treasurer in He was appointed executive vice president and chief financial officer in Bullis joined The Hanover in He plans to retire from the company May 10, 2010, and will work closely with Bensinger in the interim to ensure a smooth transition in financial leadership. Gene has provided outstanding leadership as chief financial officer of our company, and has done so during a time of great distress and disruption in the economy and the financial markets, said Eppinger. We wish him the best as he enjoys retirement with his family. About The Hanover The Hanover Insurance Group, Inc. (NYSE: THG), based in Worcester, Mass., is the holding company for a group of insurers that includes The Hanover Insurance Company, also based in Worcester; Citizens Insurance Company of America, headquartered in Howell, Mich., and their affiliates. The Hanover offers a wide range of property and casualty products and services to individuals, families and businesses through an extensive network of independent agents, and has been meeting its obligations to its agent partners and their customers for more than 150 years. Taken as a group, The Hanover ranks among the top 30 property and casualty insurers in the United States. CONTACTS: Investor Relations Media Relations Robert P. Myron Oksana Lukasheva Michael Buckley rmyron@hanover.com olukasheva@hanover.com mibuckley@hanover.com (508) (508) (508)