THG 2019 Proxy Statement

THE HANOVER INSURANCE GROUP 2019 PROXY STATEMENT 45 (2) Based on a value of $116.77 per share, which was the closing price per share of our Common Stock on the NYSE on December 31, 2018. (3) TBRSUs that vest in full on the third anniversary of the date of grant. TBRSUs granted on February 23, 2016 settled and shares were delivered on February 25, 2019. (4) PBRSUs that vest on the third anniversary of the grant date if the Company achieves a specified relative total shareholder return for the years 2016-2018. The actual award that is delivered may be as low as 0% and as high as 150% of the target award based upon the actual level of shareholder return achieved during the performance period. For the 2016-2018 period, the Company’s relative total shareholder return ranked it in the 58 th percentile against its pre-determined peer group. Accordingly, the award shown in the table reflects 115.38% of the target award value. The award granted on February 23, 2016 was settled and shares were delivered to the holders on February 25, 2019. For Mr. Farber’s award received in connection with his hiring in 2016, relative total shareholder return was measured from the grant date (his date of hire) through December 31, 2018, and during that period, the Company’s relative total shareholder return ranked it in the 88 th percentile against its pre-determined peer group. Accordingly, the award shown in the table for Mr. Farber reflects 150% of the target award value. (5) PBRSUs that vest on the third anniversary of the grant date if the Company achieves a specified relative total shareholder return for the years 2017-2019. The actual award that is delivered may be as low as 0% and as high as 150% of the target award shown in the table above based upon the actual level of shareholder return achieved during the performance period. For Mr. Salvatore, relative total shareholder return is measured from the grant date (his date of hire) through December 31, 2019. (6) TBRSUs that vest over three years in three substantially equal annual installments on the anniversary of the grant date. (7) PBRSUs that vest on the third anniversary of the grant date if the Company achieves a specified relative total shareholder return for the years 2018-2020. The actual award that is delivered may be as low as 0% and as high as 150% of the target award shown in the table above based upon the actual level of shareholder return achieved during the performance period. Unlike prior PBRSU and TBRSU grants, 2018 awards include dividend equivalent rights to the extent dividends are paid with respect to our Common Stock and the awards actually vest. (8) PBRSUs that vest on the second anniversary of the grant date (his date of hire) if the Company achieves a specified relative total shareholder return measured from the grant date through December 31, 2018. The actual award that is delivered may be as low as 0% and as high as 150% of the target award based upon the actual level of shareholder return achieved during the performance period. For the performance period, the Company’s relative total shareholder return ranked it in the 88 th percentile against its pre-determined peer group. Accordingly, the award shown in the table reflects 150% of the target award value. (9) Grants of matching shares under the Chaucer SIP. Subject to certain exceptions, such shares are subject to a three-year Chaucer employment vesting requirement.