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<FILENAME>y98951a2exv10w17.txt

<DESCRIPTION>FORM OF EMPLOYMENT AGREEMENT

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                     NATIONAL ATLANTIC HOLDINGS CORPORATION



                              EMPLOYMENT AGREEMENT



            THIS EMPLOYMENT AGREEMENT (the "Agreement") is made this ____ day of

October, 2004 by and between National Atlantic Holdings Corporation, a New

Jersey corporation (the "Company"), and [NAME] (the "Executive").



            WHEREAS, the parties hereto wish to enter into an employment

agreement to set forth certain terms and conditions of the employment

relationship between the Executive and the Company.



            NOW, THEREFORE, in consideration of the mutual covenants and

representations contained herein, the parties hereto agree as follows:



      1.    Employment Period.



            The Company agrees to employ the Executive pursuant to the terms of

this Agreement, and the Executive agrees to be so employed, for a term of three

years commencing on the closing date of the Company's initial public offering of

common stock as contemplated by the Form S-1 filed with the Securities and

Exchange Commission on July 30, 2004 (the "Effective Date"). The term of this

Agreement shall be automatically extended for successive one-year periods

beginning on the first anniversary of the Effective Date and on each successive

anniversary thereafter (such that, on each anniversary date, the Agreement shall

have a remaining term of three years), unless at least ninety (90) days prior to

any such anniversary date, either party provides written notice to the other

party of its intent not to extend the term of this Agreement. Notwithstanding

the foregoing, the Executive's employment hereunder may be earlier terminated,

subject to Section 5 hereof. The period of time between the Effective Date and

the termination of the Executive's employment hereunder shall be referred to

herein as the "Employment Period."



      2.    Position and Duties.



            The Company hereby employs the Executive as the [TITLE] of the

Company on the terms and conditions set forth in this Agreement. During the

Employment Period, the Executive shall report directly to the [Board of

Directors/Chief Executive Officer] of the Company, and shall exercise such

authority, perform such executive duties and functions and discharge such

executive responsibilities as are reasonably associated with the Executive's

position, commensurate with the authority vested in the Executive pursuant to

this Agreement and consistent with the By-Laws of the Company. During the

Employment Period, the Executive shall devote substantially all of the

Executive's business time and full skill and efforts to the business of the

Company, provided that the Executive may serve on corporate, civic, charitable

or professional association boards or committees to the extent such activities

do not interfere with the Executive's duties hereunder or are in any manner

competitive with the Company.



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      3.    Compensation and Benefits.



            (a) Salary. During the Employment Period, the Company shall pay to

the Executive, as compensation for the performance of the Executive's duties

under this Agreement, a base salary at the rate of $_________ per annum ("Base

Salary"), payable in arrears not less frequently than monthly in accordance with

the normal payroll practices of the Company. Such Base Salary shall be subject

to review each year for possible increase by the Board of Directors of the

Company (the "Board") in its sole discretion.



            (b) Bonus. In addition to the Base Salary payable to the Executive

hereunder, the Executive may also be eligible to receive additional bonus or

incentive compensation, at such times and in such amounts as shall be determined

in the sole discretion of the Board, consistent with the bonus or incentive

plans, if any, to be established by the Board.



            (c) Vacation. The Executive initially shall be entitled to three (3)

weeks of paid vacation for each calendar year during the Employment Period, to

be accrued and taken in accordance with the Company policy as in effect from

time to time. Following the completion of five (5) years of employment with the

Company, the number of weeks of paid vacation to which the Executive shall be

entitled shall be increased to five (5) weeks per year.



            (d) Equity Plans. The Executive shall be eligible to receive awards



under the equity-based incentive compensation plans adopted by the Company

during the Employment Period for which senior executives are generally eligible.

The level of the Executive's participation in any such plan, if any, shall be

determined in the sole discretion of the Board. In addition, the Executive shall

retain all rights with respect to any previously granted stock options in

accordance with the terms and conditions of the applicable stock option

agreement and plan.



            (e) Employee Benefits. During the Employment Period, the Executive

shall be entitled to participate in the employee and fringe benefit plans,

programs and arrangements of the Company in effect during the Employment Period

that are generally available to senior executives of the Company, subject to and

on a basis consistent with the terms, conditions and overall administration of

such plans, programs and arrangements.



            (f) Business Expenses. During the Employment Period, the Executive

shall be entitled to reimbursement for all reasonable business expenses incurred

by the Executive in connection with the performance of the Executive's services

to the Company, to be documented and reimbursed in accordance with the policies

and procedures of the Company as in effect from time to time.



      4.    Termination of Employment.



            (a) Termination by Company; Termination for Cause. The Company may

terminate the Executive's employment hereunder for any reason by giving the

Executive thirty (30) days' written notice of its intent to terminate the

Executive's employment. For purposes of this Agreement and subject to the

Executive's opportunity to cure as provided in Section 4(c) hereof, the Company

shall have "Cause" to terminate the Executive's employment hereunder if such

termination shall be the result of: (i) a willful and continuing failure of the

Executive to substantially perform the Executive's duties under this Agreement

(other than as a result of the



                                       2

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Executive's death or Disability), or the Executive's gross negligence in the

performance of such duties; (ii) the Executive's failure to follow any lawful

directive of the Chief Executive Officer or the Board in connection with the

Executive's duties to the Company as set forth in Section 2 hereof; (iii) the

conviction of the Executive of a felony under the laws of the United States or

any state thereof; (iv) the Executive's willful breach of a fiduciary duty,

willful disregard of material Company rules, or an act of embezzlement or fraud

involving the Company or its Affiliates; or (v) a material breach by the

Executive of Section 7 hereof.



            (b) Termination by Employee; Termination for Good Reason. The

Executive shall have the right at any time to terminate the Executive's

employment with the Company for any reason by giving the Company thirty (30)

days' written notice of intent to terminate employment. For purposes of this

Agreement and subject to the Company's opportunity to cure as provided in

Section 4(c) hereof, the Executive shall have "Good Reason" to terminate

employment hereunder if such termination shall be the result of any of the

following, taken without the advance written consent of the Executive: (i) a

reduction in the Executive's Base Salary; (ii) a demotion of the Executive to a

position of lesser status, authority or reporting relationship; or (iii) the

relocation of the Executive's principal place of business beyond fifty (50)

miles from its current location.



            (c) Notice and Opportunity to Cure. Notwithstanding the foregoing,

it shall be a condition precedent to the Company's right to terminate the

Executive's employment for Cause and the Executive's right to terminate

employment for Good Reason that (1) the party seeking the termination shall

first have given the other party written notice stating with reasonable

specificity the reason for the termination ("breach") and (2) if such breach is

susceptible of cure or remedy, a period of thirty days from and after the giving

of such notice shall have elapsed without the breaching party having effectively

cured or remedied such breach during such 30-day period, unless such breach

cannot be cured or remedied within thirty days, in which case the period for

remedy or cure shall be extended for a reasonable time (not to exceed an

additional thirty days) provided the breaching party has made and continues to

make a diligent effort to effect such remedy or cure. Notwithstanding anything

to the contrary contained herein, the right to cure set forth in this Section

4(c) shall not apply if there are habitual or repeated breaches by either party.

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