CINCINNATI FINANCIAL CORPORATION
RESTRICTED STOCK UNIT AGREEMENT
PERFORMANCE-BASED
John J. Schiff, Jr.
6200 South Gilmore Rd
Fairfield, OH 45014-5141
As of February 18, 2008, the Fair Market Value of the maximum
number of shares underlying this award was $356,353.20.
CINCINNATI FINANCIAL CORPORATION (the Company) hereby grants to the
associate identified below (the Participant) a Restricted
Stock Unit Award (the Award) under the Company's 2006 Stock
Compensation Plan (the Plan) with respect to the number
of Restricted Stock Units (the Units) specified under Part I. Award
Information below, all in accordance with and subject to the
provisions set forth in Part II -- Terms and Conditions.
PART I. AWARD INFORMATION :
Participant Name: John J. Schiff, Jr.
Maximum Number of Units Awarded: 9,480
Award Date: February 18, 2008
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Definitions:
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“Determination Date” means March
1, 2011.
“Base Period” means the year
ended December 31, 2007.
“Measurement Period” means the
three years ended December 31, 2010.
“Operating Income” means
operating income as such term is commonly used by the Company but
excluding the effects of capital gains and losses, accounting
changes, losses attributable to catastrophes that are assigned
catastrophe numbers by PCS and any favorable development on prior
accident years in excess of 2.5% of property casualty earned
premiums.
“Performance Measure” means the
Company’s Operating Income for the entire Measurement Period
expressed as a percentage of the Company’s Operating Income
for the Base Period.
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Vesting Criteria: The Units granted in the Award will vest
and the number of shares indicated below will be issued on the
Determination Date if the specified Performance Measure has been
achieved.
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Number of Shares
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To Be Issued Upon Achievement of
Performance Measure of ….
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-0-
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less than 285%
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6,320 *
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285%
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7,900 *
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300%
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9,480
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315%
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* Number of Shares to be issued for performance between specified Performance Measures shall be pro-rated.
Beneficiary Designation (Optional -- see Part II, Section 8):
THIS AWARD IS SUBJECT TO FORFEITURE AS PROVIDED IN THIS RESTRICTED
STOCK UNIT AGREEMENT AND THE PLAN.
By accepting this Award, the Participant acknowledges the receipt
of a copy of this Restricted Stock Unit Agreement (including Part
II -- Terms and Conditions) and a copy of the Prospectus and agrees
to be bound by all the terms and provisions contained in them and
in the Plan.
IN WITNESS WHEREOF, this Restricted Stock Unit Agreement has been
duly executed as of the Award Date specified above.
CINCINNATI FINANCIAL CORPORATION
By: /s/ John J. Schiff, Jr.
Chairman &
CEO
ACCEPTED:
/s/ John J. Schiff,
Jr.
John J. Schiff, Jr.
PART II. TERMS AND CONDITIONS
1.
Restricted Stock Units. Each Unit represents a hypothetical share
of the Company's Common Stock (the Shares), and each Unit will at
all times be equal in value to one Share. The Units will be
credited to the Participant in an account established for the
Participant and maintained by the Company's Shareholder Services
Department. If and when Units vest as provided below, Shares in an
amount equal to the number of vested Units will automatically be
issued to the Participant on the Determination Date and will
be evidenced by a stock certificate or a book entry account
maintained by Shareholder Services.
2.
Restrictions. Subject to Sections 3 and 4 below, the restrictions
on the Units specified in Part I -- Award Information (the Award
Information) shall lapse and such Units shall vest as set forth in
the Award Information, provided that: (a) the specified Performance
Measure has bee
