Retention Agreement, entered into as of September 14, 2005, between 21st Century Insurance Group, 21st Century Insurance Company and Bruce W. Marlow

Fax: 818 ###-###-#### Tel.: 818 ###-###-####

Mr. Bruce W. Marlow

(1)

Willful Failure to Perform Duties. You continue willfully to fail to perform your duties for the Company after a written demand for performance has been delivered to you by the Board that specifically identifies how you have failed to perform. Your conduct will not be considered “willful” if a reasonable person would believe that you were acting in the best interests of the Company, you believed the action you were requested to perform was unlawful or unethical, or if your failure to perform was caused by your physical or mental illness. You may not be terminated for Cause under this paragraph after you have properly notified the Company that you are resigning for Good Reason.

(2)

Willful Adverse Conduct. You willfully engage in conduct that is demonstrably and materially injurious to the Company or its Affiliates, monetarily or otherwise. Your conduct will not be considered “willful” if you believed in good faith that you were acting in the best interests of the Company and such belief was reasonable. Reporting a violation of Federal, State or Local law or regulation or taking action necessary to comply with such laws and regulations shall not be considered willfully adverse conduct as long as you are acting in good faith in making such report or complying with such laws.

(1)

Breach of Promise. The Company has committed a material breach of its obligations under this Agreement.

(2)

Improper Termination. You are purportedly terminated, other than pursuant to a Termination Notice satisfying the requirements of Section 4.

/s/
Bruce W. Marlow
Date:           9-14-05

 

This Separation Agreement and General and Special Release of Claims (“Release”) is entered into by ____________________ ("Employee") and 21st Century Insurance Group and subsidiaries (hereinafter collectively referred to as the "Company”). It is entered into to resolve amicably all matters between Employee and the Company concerning Employee's employment and the cessation of that employment.

1.     Separation Benefits. Notwithstanding this Agreement, Employee shall receive payment of all accrued and unpaid salary and vacation through Employee's last day of employment, subject to required and authorized deductions. In exchange for Employee's decision to enter into this Agreement as well as the Retention Agreement, the Company agrees to pay Employee the severance payments set forth in the Retention Agreement. The payments shall be made payable to Employee as required pursuant to the Retention Agreement, provided that Employee has not exercised Employee's right of revocation.

2.     Release. Except for the claims specifically excluded from release by section 5(a) of the Retention Agreement for which no dispute has arisen (and remains unresolved) prior to the execution of this Release, Employee (on behalf of Employee and Employee's agents, heirs, successors, assigns, spouses, executors and/or administrators) does hereby and forever release and discharge the Company as well as the successors, predecessors, partnerships, partners, joint venturers, affiliated entities, parents, subsidiaries, officers, directors, shareholders, accountants, insurers, advisors, employees, attorneys, heirs, assigns, agents, spouses, executors and/or administrators and representatives of the Company, past or present, from any and all causes of action, actions, judgments, liens, debts, contracts, indebtedness, damages, losses, claims, liabilities, rights, interests and demands of whatsoever kind or character, known or unknown, suspected to exist or not suspected to exist, anticipated or not anticipated, whether or not heretofore brought before any state or federal court, which Employee has or may have against any released person or entity, by reason of any and all acts, omissions, events or facts occurring or existing prior to the date the Agreement is signed by Employee, including, without limitation, all claims attributable to the employment of Employee, all claims attributable to the cessation of that employment, and all claims arising under any federal, state or other governmental statute, regulation or ordinance or common law, such as, for example and without limitation, breach of contract, breach of implied covenant, breach of oral or written promise, allegedly unpaid compensation, wrongful termination, infliction of emotional distress, defamation, interference with contract relations or prospective economic advantage, negligence, misrepresentation or employment discrimination, violation of Title VII of the Civil Rights Act of 1964, the Civil Rights Act of 1866, the Age Discrimination in Employment Act of 1967, the Americans with Disabilities Act, the Family and Medical Leave Act, the WARN Act, the Equal Pay Act, the Fair Labor Standards Act, ERISA, the California Unruh Act, the California Fair Employment and Housing Act, the California Labor Code (excepting any workers' compensation claim) and wrongful termination claims, excepting only those obligations expressly recited to be performed hereunder. Employee acknowledges that Employee is not presently suffering from any work-related injury and that Employee has fully recovered from any and all prior work-related injuries.

In light of the intention of Employee (for Employee, Employee's agents, heirs, successors, assigns, executors, spouses, and/or administrators) that this release extend to any and all claims of whatsoever kind or character, known or unknown, Employee expressly waives any and all rights granted by California Civil Code Section 1542 (or any other analogous federal or state law or regulation). Section 1542 reads as follows:

A GENERAL RELEASE DOES NOT EXTEND TO CLAIMS WHICH THE CREDITOR DOES NOT KNOW OR SUSPECT TO EXIST IN HIS FAVOR AT THE TIME OF EXECUTING THE RELEASE, WHICH IF KNOWN BY HIM MUST HAVE MATERIALLY AFFECTED HIS SETTLEMENT WITH THE DEBTOR.

3.     No Admissions or Assignment. Nothing contained herein shall be construed as an admission of wrongdoing or liability by either the Employee or the Company. Employee shall make no assignment of any matter released by this Agreement and Employee represents that no such assignment has been made.

4.     Company Property and Confidential Information. All memoranda, notes, records and other documents made or compiled by Employee or made available to Employee during Employee's employment concerning or related to the Company or any if its clients, whether in hard copy or electronic form, are Company property. Employee agrees to deliver all Company property to the Company upon request by the Company, and if not requested, upon or before the cessation of Employee’s employment with the Company. Employee agrees that any and all non-public information about the Company or any of its clients constitutes Confidential Information. Employee agrees not to disclose to any person, directly or indirectly, (including without limitation present or former employees of the Company), any Confidential Information excepting only (i) Employee's spouse, if any, (ii) Employee's attorneys and accountants, only as necessary, and (iii) under compulsion of law or court process. 

5.     Covenant Not To Sue. Employee covenants and represents that he shall have no right whatsoever to file any lawsuit or institute any other legal proceeding of any type whatsoever against the Company based upon or arising out of or during Employee’s employment with the Company based upon facts, acts or omissions occurring prior to the date of the signing of this Separation Agreement and General and Special Release of Claims. This section shall not prohibit Employee from challenging the validity of his release of ADEA claims in Section 2 of this Agreement.

6.     Entire Agreement/Modifications/Severability. This Agreement along with the Retention Agreement constitute a single integrated contract expressing the entire agreement of the parties with respect to the subject matter hereof, including without limitation all matters pertaining to or arising out of the Employee's employment or employment termination, and supersedes all prior and contemporaneous oral, written and implied agreements and discussions with respect to the subject matter hereof. There are no other agreements, written or oral, express or implied, between the parties hereto, concerning the subject matter hereof, except as set forth herein. This Agreement may be amended or modified only by an agreement in writing. Should any provision of this Agreement become or be held to be legally unenforceable, no other provision of this Agreement shall be affected, and this Agreement shall be construed to be enforceable or shall be construed as if the Agreement had never included the unenforceable provision. Any invalid or unenforceable provision of this Agreement shall be modified or reformed as permitted by law so that such provision is no longer invalid or unenforceable.

7.     EEOC Cooperation. The Company and Employee agree that nothing in this Agreement shall prevent Employee from cooperating with the Equal Employment Opportunity Commission (“EEOC”) in the course of an investigation performed by the EEOC.

8.     Waiting Period and Right of Revocation. EMPLOYEE ACKNOWLEDGES THAT EMPLOYEE IS AWARE THAT AND IS HEREBY ADVISED THAT EMPLOYEE HAS THE RIGHT TO CONSIDER THIS AGREEMENT FOR FORTY-FIVE DAYS FROM THE DATE OF DELIVERY OF THIS RELEASE FORM BEFORE SIGNING IT AND THAT IF EMPLOYEE SIGNS THIS AGREEMENT PRIOR TO THE EXPIRATION OF FORTY-FIVE DAYS, EMPLOYEE IS WAIVING THIS RIGHT FREELY AND VOLUNTARILY. EMPLOYEE ALSO ACKNOWLEDGES THAT EMPLOYEE IS AWARE OF AND IS HEREBY ADVISED OF EMPLOYEE’S RIGHT TO REVOKE THIS AGREEMENT FOR A PERIOD OF SEVEN DAYS FOLLOWING THE SIGNING OF THIS AGREEMENT AND THAT IT SHALL NOT BECOME EFFECTIVE OR ENFORCEABLE UNTIL THE REVOCATION PERIOD HAS EXPIRED. TO REVOKE THIS AGREEMENT, EMPLOYEE MUST NOTIFY THE COMPANY, IN WRITING, WITHIN SEVEN DAYS OF SIGNING IT.

9.     Attorney Advice. EMPLOYEE ACKNOWLEDGES THAT EMPLOYEE IS AWARE OF EMPLOYEE'S RIGHT TO CONSULT AN ATTORNEY, THAT EMPLOYEE HAS BEEN ADVISED TO CONSULT WITH AN ATTORNEY, AND THAT EMPLOYEE HAS HAD THE OPPORTUNITY TO CONSULT WITH AN ATTORNEY, IF DESIRED, PRIOR TO SIGNING THIS AGREEMENT.

 

10.     Understanding of Agreement. Employee states that Employee is physically and mentally competent to enter into this Agreement, that Employee has carefully read this Agreement, that Employee has had sufficient time and opportunity to consider its terms and to obtain legal advice, if desired, that Employee fully understands its effect, that the only promises made to Employee to sign this Agreement are those stated above, and that Employee is signing this Agreement voluntarily and without any threat, duress, coercion or undue influence.

Dated: ____________		By	__________________________________
			Employee
Dated: ____________		21st Century Insurance Group and
		Subsidiaries
		By
		______________________________________
		[name of Company official]
		[title]

 

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