Exhibit 10. 1

February 21, 2013

Mr. Roger B. Gorham

1 Trotter Court

Hillsborough, New Jersey 08844

Dear Roger:

This letter agreement (this “Agreement”) sets forth the terms and conditions of
your employment with Alleghany Corporation, a Delaware corporation (the
“Company”), and the benefits that you will be entitled to receive if and when
your employment with the Company terminates.

In consideration of the mutual covenants and promises made in this Agreement,
you and the Company agree as follows:

1. Term. Your employment with the Company is at-will and either you or the
Company may terminate your employment at any time and for any reason, with or
without “Cause,” as defined below, in each case subject to the terms and
provisions of this Agreement during the term of this Agreement.

2. Consequences of Termination of Employment. Unless the Company requests
otherwise, upon the termination of your employment for any reason, you will be
deemed to have immediately resigned from all positions as an officer or director
with the Company (and its affiliates) as of your last day of employment (the
“Termination Date”). Upon termination of your employment for any reason, you
will receive payment from the Company on your Termination Date covering all of
the following: (i) all earned but unpaid salary through the Termination Date,
(ii) all unpaid vacation accrued through the Termination Date, (iii) any
payments/benefits to which you are entitled under the express terms of any
applicable employee benefit plan of the Company and (iv) any unreimbursed valid
business expenses (collectively, (i) through (iv) are the “Accrued
Obligations”).

(a) Termination for Cause. In the event that your employment is terminated by
the Company for “Cause,” you will be entitled only to your Accrued Obligations.
You will be entitled to no other compensation from the Company. For purposes of
this Agreement, your employment may be terminated by the Company for “Cause” as
a result of the occurrence of one or more of the following: (i) your conviction
of a felony (other than a traffic violation), (ii) your willful material failure
to implement reasonable directives of the Chief Executive Officer of the Company
after written notice is delivered to you, which failure is not corrected within
ten (10) days following notice thereof, or (iii) willful gross misconduct in
connection with the performance of any of your duties. For purposes of clauses
(ii) and (iii) of the definition of Cause, your action or inaction will not be
considered “willful” unless done or omitted by you (A) intentionally or not in
good faith and (B) without reasonable belief that your action or inaction was in
the best interest of the Company or any of its affiliates, and will not include
a failure to act by reason of physical or mental incapacity.

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(b) Termination without Cause (other than Total Disability or Death). The
Company may terminate your employment without Cause at any time and for any
reason without notice. If your employment is terminated by the Company other
than for (1) Cause or (2) on account of your Total Disability or death, then
subject to the terms of this Section 2(b) and Section 5, you will be entitled to
receive severance pay equal to $1,200,000, payable in substantially equal
bi-weekly installments, commencing on the sixtieth (60th) day following your
Termination Date (your “Severance Pay”). As a condition to receiving (and
continuing to receive) the Severance Pay provided in this Section 2(b), you must
(i) within any specified time period established by the Company, execute (and
not revoke) a separation agreement (which will include a non-disparagement
provision) and general release of claims (in a form prescribed by the Company)
of all known and unknown claims that you may then have against the Company or
persons affiliated with the Company, (ii) have timely returned all Company
property to the Company and (iii) remain in full compliance with such separation
agreement. You will not be required to mitigate the amount of any payment or
benefit contemplated by this Section 2(b), nor will any such payment or benefit
be reduced by any earnings or benefits that you may receive from any other
source. For purposes of this Agreement, “Total Disability” means your inability
to discharge your duties hereunder due to physical or mental illness or accident
for one or more periods totaling six (6) months during any consecutive twelve
(12) month period.

(c) Voluntary Termination. In the event you voluntarily terminate your
employment with the Company or your employment with the Company is terminated
because of your Total Disability or death, you will be entitled to receive only
your Accrued Obligations. You will be entitled to no other compensation from the
Company. You agree to provide the Company with at least thirty (30) days’
advance written notice of your intent to voluntarily terminate your employment.

3. Assignability; Binding Nature. This Agreement will be binding upon you and
the Company and your respective successors, heirs, and assigns. This Agreement
may not be assigned by you except that your rights to compensation and benefits
hereunder, subject to the limitations of this Agreement, may be transferred by
will or operation of law. No rights or obligations of the Company under this
Agreement may be assigned or transferred except by operation of law in the event
of a merger or consolidation in which the Company is not the continuing entity,
or the sale or liquidation of all or substantially all of the assets of the
Company, provided that the assignee or transferee is the successor to all or
substantially all of the assets of the Company and assumes the Company’s
obligations under this Agreement contractually or as a matter of law.

4. Taxes. Anything to the contrary notwithstanding, all payments made by the
Company hereunder to you or your estate or beneficiaries will be subject to tax
withholding pursuant to any applicable laws or regulations.

5. Section 409A. The payments under this Agreement are intended to comply with
the provisions of Section 409A of the Internal Revenue Code of 1986, as amended
(which together with the regulations issued thereunder and other rulings,
notices and other guidance

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issued by the Internal Revenue Service interpreting same is herein referred to
as “Section 409A”) or an exception to Section 409A. Any payments that qualify
for the “short-term deferral” exception under Section 409A, the “separation pay”
exception under Treasury Regulation Section 1.409A-l(b)(9)(iii) or any other
exception under Section 409A will be paid under the applicable exceptions to the
greatest extent possible. Each payment of compensation under this Agreement will
be treated as a separate payment, and in no event may you, directly or
indirectly, designate the calendar year of any compensatory payment under this
Agreement. If, on your Termination Date, you are a “specified employee,” within
the meaning of Section 409A and determined by the Company, then any payments
that are required to be made to you pursuant to this Agreement as a result of
your employment being terminated that constitute nonqualified deferred
compensation (within the meaning of Section 409A) that otherwise would have been
paid to you within six months and one day of your Termination Date (the
“Deferred Compensation Payments”) will not be paid to you at the time herein
provided. Instead, the Deferred Compensation Payment will be accumulated and
paid to you in a lump sum with interest thereon at a rate equal to the yield per
annum on the six (6) month Treasury bills (secondary market) on your Termination
Date (as reported by the Federal Reserve Board) from the date payment would have
been made to you hereunder until the date paid, such payment to be made as soon
as practicable following the earlier of (i) the day after the date that is six
(6) months from your Termination Date and (ii) your death (with payment being
made to your estate). For these purposes, you will be a “specified employee” if,
on the date your employment is terminated you are an individual who is, under
the method of determination adopted by the Committee designated as, or within
the category of employees deemed to be, a “specified employee” within the
meaning and in accordance with Section 409A. The Company will determine in its
sole discretion all matters relating to who is a “specified employee” and the
application and effect of the change in such determination. Notwithstanding
anything to the contrary, your Termination Date will not be deemed to occur
until the date of your “separation from service” as defined in Section 409A.

6. Withholding. The Company may withhold from any amounts payable under this
Agreement, or any other benefits received pursuant hereto, any Federal, state
and/or local taxes as will be required to be withheld under any applicable law
or regulation.

7. Entire Agreement; Amendment. This Agreement contains the entire understanding
between you and the Company with respect to the subject matter hereof and
thereof and, except as specifically provided herein or therein, cancel and
supersede any and all other agreements between you and the Company with respect
to the subject matter hereof and thereof. Any amendment or modification of this
Agreement will not be binding unless in writing and signed by you and the
Company. This Agreement may be executed in one or more counterparts, each of
which will be deemed an original but all of which together will constitute one
and the same instrument.

8. Governing Law. This Agreement will be governed by and enforceable in
accordance with the laws of the State of New York, without giving effect to the
principles of conflict of laws thereof.

9. Miscellaneous. This Agreement will be binding upon, inure to the benefit of
and be enforceable by, as applicable, each of the Corporation and you and each
party’s respective

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personal or legal representatives, executors, administrators, successors,
assigns, heirs, distributees and legatees. This Agreement is personal in nature
to you and you will not, without the written consent of the Company, assign,
transfer or delegate any rights or obligations hereunder. The Company will not
assign, transfer or delegate any rights or obligations hereunder, other than as
a result of a corporate transaction in which the assignee, transferee or
delegate agrees to assume all of the Company’s obligations hereunder.

10. Offset. To the extent permitted under Section 409A, any Severance Pay or
other payments or benefits made to you under this Agreement may be reduced, in
the Company’s discretion, by any amounts you owe to the Company.

11. Notice. Any notice that the Company is required or may desire to give you
will be given by personal delivery, recognized overnight courier service, email,
telecopy or registered or certified mail, return receipt requested, addressed to
you at your address of record with the Company, or at such other place as you
may from time to time designate in writing. Any notice that you are required or
may desire to give to the Company hereunder will be given by personal delivery,
recognized overnight courier service, email, telecopy or registered or certified
mail, return receipt requested, addressed to the Company at its principal
office, or at such other office as the Company may from time to time designate
in writing. The date of actual delivery of any notice under this Section 11 will
be deemed to be the date of delivery thereof.

12. Waiver; Severability. No provision of this Agreement may be amended or
waived unless such amendment or waiver is agreed to by you and the Company in
writing. No waiver by you or the Company of the breach of any condition or
provision of this Agreement will be deemed a waiver of a similar or dissimilar
provision or condition at the same or any prior or subsequent time. Failure or
delay on the part of either party hereto to enforce any right, power, or
privilege hereunder will not be deemed to constitute a waiver thereof. In the
event that any portion of this Agreement is determined to be invalid or
unenforceable for any reason, the remaining portions will be unaffected thereby
and will remain in full force and effect to the fullest extent permitted by law.

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If the foregoing accurately expresses our mutual understanding, please
acknowledge your acceptance and understanding of this Agreement by signing and
returning it to the undersigned. A copy of this signed Agreement will be sent to
you for your records.

 

Sincerely, ALLEGHANY CORPORATION By:  

/s/ Weston M. Hicks

Name:   Weston M. Hicks Title:   President and chief executive officer

 

AGREED AND ACCEPTED:

/s/ Roger B. Gorham

Roger B. Gorham