Exhibit 10.2
ALLEGHANY CORPORATION OFFICERS, HIGHLY
COMPENSATED EMPLOYEES AND DIRECTORS
DEFERRED COMPENSATION PLAN
     Alleghany Corporation Officers, Highly Compensated Employees and Directors
Deferred Compensation Plan (the “Plan”), effective as of January 1, 2002,
provides for unfunded deferred compensation arrangements for officers, certain
highly compensated employees and directors of Alleghany Corporation, a Delaware
corporation (“Alleghany”), as well as a savings benefit for officers and certain
highly compensated employees of Alleghany.
1. Purposes of the Plan.
     The purposes of the Plan are (i) to provide a means to defer a portion of
the compensation of the officers of Alleghany, highly compensated employees of
Alleghany designated by the Board of Directors of Alleghany (the “Board”) and
directors of Alleghany and (ii) to provide a savings benefit for officers of
Alleghany and highly compensated employees of Alleghany designated by the Board.
2. Administration of the Plan.
     The Plan shall be administered by an officer of Alleghany (the “Plan
Administrator”) appointed by the Board to serve as administrator under the
direction of the Board (the “Plan Administrator”). The Board shall have full
power and authority to interpret, construe, administer, and amend the Plan,
provided, however, that no amendment to the Plan shall reduce the benefits to
which any Participant (as defined below) may be entitled hereunder, and the
Board’s interpretation and construction thereof and actions taken thereunder
shall be binding on all persons for all purposes.
     3. Participation.

 

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     All officers who have completed one year of full-time service and other
officers and highly compensated employees of Alleghany designated by the Board
(“Savings Benefit Participants”) shall participate in the Plan in respect of the
savings benefit described in section 4(b) hereof, and directors (“Director
Participants”) and officers and certain highly compensated employees of
Alleghany designated by the Board (“Officer Participants”) of Alleghany shall be
eligible to participate in the Plan by deferring amounts described in section
4(c) hereof. The term “Participants” as used in the Plan shall include Savings
Benefit Participants, Director Participants and Officer Participants
collectively.
4. Deferred Compensation.
     (a) Prime Rate Accounts. Alleghany shall establish in respect of each
Savings Benefit Participant a separate book reserve account (“Savings Benefit
Prime Rate Account”), and shall credit to such Savings Benefit Prime Rate
Account (or if section 4(e) shall apply, to the Savings Benefit Common Stock
Account described thereunder), for eventual payment on the basis set forth in
section 4(f) hereof, the savings benefit described in section 4(b) below.
     Subject to the limitations set forth in section 4(g) hereof and to such
administrative rules as may be established by the Plan Administrator, each
Participant may from time to time enter into one or more agreements with
Alleghany (“Deferred Compensation Agreements”) which in the aggregate may
provide for the establishment of one or more separate book reserve accounts
“Deferred Compensation Prime Rate Accounts” and for the crediting to such
Deferred Compensation Prime Rate Accounts or if section 4(e) shall apply, to the
Deferred Compensation Common Stock Accounts of Officer Participants described
thereunder for eventual payment on the basis set forth in section 4(g) below, of
the items described in section 4(c) below. Savings

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Benefit Prime Rate Accounts and Deferred Compensation Prime Rate Accounts are
together referred to herein as “Prime Rate Accounts.”
     (b) Savings Benefit. On the 30th days of March, June, September and
December of each year, Alleghany will credit each Savings Benefit Prime Rate
Account (or if section 4(e) shall apply, the Savings Benefit Common Stock
Account described thereunder) with an amount equal to 3.75% of the base annual
salary (excluding bonuses, commissions, severance pay, amounts deferred under
this section 4(b) and contributions to employee benefit plans maintained by
Alleghany, but including base annual salary deferred under section 4(c)(1)
below) payable to the Savings Benefit Participant by Alleghany during the
quarter then ended.
     (c) Optional Deferral. Deferred Compensation Agreements entered into by
Officer Participants and Director Participants of Alleghany may provide for the
deferral of all or any part of the following (as applicable):
          (1) The base annual salary (determined as provided in section 4(b)
above) payable to such person by Alleghany;
          (2) Directors’ fees payable to such person by Alleghany;
          (3) Entitlements of such person under the Alleghany Corporation
Management Incentive Plan or any similar bonus plan of Alleghany;
          (4) Entitlements of such person under the Alleghany Corporation 2002
Long-Term Incentive Plan, the Alleghany Corporation 1993 Long-Term Incentive
Plan or any successor long-term incentive plan (collectively, “Long-Term
Incentive Plans”); and

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          (5) Any cash bonus to which such person may become entitled other than
pursuant to a plan referred to in section 4(c)(3) or section 4(c)(4).
Amounts described in sections 4(c)(1) through 4(c)(5) shall be credited to the
specified Deferred Compensation Prime Rate Account (or if section 4(e) shall
apply, to the Deferred Compensation Common Stock Account described thereunder)
in lieu of payment in the ordinary course and as of the times when they would
have been payable in the ordinary course. Entitlements in Common Stock of
Alleghany shall be valued at the mean between the high and low prices thereof on
the New York Stock Exchange Consolidated Tape on the date of crediting.
     (d) Interest. Amounts credited to a Prime Rate Account shall, while held in
such Prime Rate Account, be deemed to earn interest at the prime rate compounded
on an annual basis and credited to the Prime Rate Account on December 31st of
each year or, if earlier, on the date of transfer or payment of amounts out of
such Prime Rate Account. The “prime rate” for purposes hereof shall mean the
rate of interest announced by JP Morgan Chase Bank, N.A. as its prime rate at
the close of the last business day of each month, which rate shall be deemed to
remain in effect through the last business day of the next month.
     (e) Common Stock Accounts. Upon the request of an Officer Participant made
by written notice given to the Plan Administrator, Alleghany shall establish in
respect of such Officer Participant a common stock account (“Savings Benefit
Common Stock Account”) to which all or a portion of the amounts described in
section 4(b) shall be credited. A Deferred Compensation Agreement entered into
between an Officer Participant and Alleghany may provide for the establishment
of a common stock account (“Deferred Compensation Common Stock Account”) to
which all or a portion of the amounts deferred thereunder shall be credited;

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provided, however, that the sum of the amounts credited to an Officer
Participant’s Savings Benefit Common Stock Account and Deferred Compensation
Common Stock Account (including amounts credited thereto in respect of dividend
income) may at no time exceed an amount equal to (x) 30% of the cumulative base
annual salary (determined as provided in section 4(b) above) of such Officer
Participant during the period in respect of which the savings benefit referred
to in section 4(b) has been credited for such Officer Participant less (y) the
sum of the original credits actually paid out to such Officer Participant in
accordance with the provisions of section 4(f) hereof. Savings Benefit Common
Stock Accounts and Deferred Compensation Common Stock Accounts are together
referred to herein as “Common Stock Accounts.”
     Amounts credited to a Common Stock Account shall, while held in such Common
Stock Account, reflect the investment experience which the account would have
had if the amount so designated had been invested (without commissions or other
transaction expenses) and held in whole or fractional shares of common stock of
Alleghany (“Alleghany Common Stock”) during such period. Common Stock Accounts
shall be adjusted as appropriate to reflect cash and stock dividends, stock
splits, and other similar distributions or transactions which, from time to
time, occur with respect to Alleghany Common Stock during the appropriate
period. Dividends and other distributions shall be automatically credited to the
Common Stock Account at their cash value or the fair market value of any
non-cash dividend or other distribution and shall be deemed to purchase
Alleghany Common Stock on the date of payment thereof. Alleghany Common Stock
shall be deemed acquired, and shall be valued for purposes of payout or
transfer, at a price per share equal to the mean between the high and low prices
thereof on the applicable date on the New York Stock Exchange Consolidated Tape.

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     Subject to rules which may be established by the Plan Administrator or by
the Board, the designation of the account to which the amounts described in
section 4(b) shall be credited, or the allocation of such amounts between
accounts, may from time to time be changed. Subject to the provisions of section
5(h) hereof and to rules which may be established by the Plan Administrator or
by the Board, an Officer Participant may direct that amounts credited to a Prime
Rate Account be transferred to a Common Stock Account, or that amounts credited
to a Common Stock Account be transferred to a Prime Rate Account, by written
notice given to the Plan Administrator. Except as may otherwise be agreed to by
the Plan Administrator, amounts transferred as set forth above shall be paid
according to the same payout schedule in effect with respect to such amounts
prior to the transfer.
     (f) Payout of Section 4(b) Amounts. All amounts theretofore credited to a
Savings Benefit Prime Rate Account and/or to an Officer Participant’s Savings
Benefit Common Stock Account shall be paid to the Participant in a lump sum (or
in such installments as approved by the chief executive officer of Alleghany in
his sole discretion) at the conclusion of the then current five-year savings
benefit deferral period or, if earlier, upon the date of the Participant’s
termination of employment with Alleghany or such date or dates after such
termination as approved by the chief executive officer of Alleghany in his sole
discretion. The Board may, at its sole option, cause any savings benefit
deferral period to terminate at such earlier time as the Board may, in its sole
discretion, determine, in which event the next succeeding five-year savings
benefit deferral period shall commence on the day following the date the
preceding period terminated. The first five-year savings benefit deferral period
commenced on January 2, 1984 and terminated on December 15, 1988.

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     Subject to rules which may be established by the Plan Administrator or by
the Board, a Participant may defer payment of all or a portion of the amounts
otherwise payable to him (including as a result of successive deferrals) at the
conclusion of each savings benefit deferral period until completion of the next
succeeding savings benefit deferral period or, if earlier, until the date of the
Participant’s termination with Alleghany (or such date or dates after such
termination as approved by the chief executive officer of Alleghany in his sole
discretion), by giving written notice to the Plan Administrator not later than
six months prior to the date on which such amount would otherwise be paid.
     (g) Payout of Section 4(c) Amounts. Each Deferred Compensation Agreement
entered into between Alleghany and a Participant shall set forth the terms for
payment in cash of amounts attributable to compensation deferred thereunder (a
“Payout Schedule”) subject to the following:
          (1) A Payout Schedule may provide for a lump sum payment or for
payment in annual installments.
     (2) Payments shall not extend beyond the year in which the Participant
attains age 90.
     (3) All payments shall be made in the month of January.
     (4) The amount of each annual installment payment shall be computed by
dividing the then balance of such Deferred Compensation Prime Rate Account
and/or Deferred Compensation Common Stock Account by the number of installments
remaining, including the current installment; provided, however, that a
different method of computation may be specified if agreed to by Alleghany.

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     (5) In addition to the normal payout schedule specified with respect to
such Deferred Compensation Prime Rate Account and/or Deferred Compensation
Common Stock Account, special payout schedules may be specified with respect to
such account to apply, respectively, in the event of (i) the Participant’s
disability, (ii) his death or (iii) the termination of his employment or his
ceasing to be a director of Alleghany.
     (6) Notwithstanding the foregoing or any provision of any Deferred
Compensation Agreement, whether in effect as of the date hereof or subsequently
entered into, the Board may at its sole option direct that payment to a
Participant of amounts described in section 4(c) shall occur at such earlier
time as the Board may, in its sole discretion, designate.
     Deferred Compensation Agreements entered into between a Director
Participant and Alleghany may provide in aggregate for payment in accordance
with no more than two Payout Schedules. Deferred Compensation Agreements entered
between an Officer Participant and Alleghany may provide in the aggregate for
payment in accordance with no more than two Payout Schedules applicable to
Deferred Compensation Prime Rate Accounts and two Payout Schedules applicable to
Deferred Compensation Common Stock Accounts.
     (h) Beneficiaries. A Savings Benefit Participant may designate a
beneficiary to receive payment of the value of amounts credited to his Savings
Benefit Prime Rate Account and/or to his Savings Benefit Common Stock Account
following the Participant’s death by filing a written notice with the Plan
Administrator. In the case of deferral by a Director Participant of amounts
described in section 4(c), a beneficiary for each Deferred Compensation Prime
Rate Account following a different Payout Schedule may be designated in the
Deferred Compensation

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Agreement or Agreements providing for such deferral. In the case of deferral by
an Officer Participant of amounts described in section 4(c), a beneficiary for
each Deferred Compensation Prime Rate Account or Deferred Compensation Common
Stock Account following a different Payout Schedule may be designated in the
Deferred Compensation Agreement or Agreements providing for such deferral. A
Participant may at any time, and from time to time, change beneficiaries by
filing a written notice with the Plan Administrator.
     (i) Hardship. Notwithstanding anything herein contained to the contrary,
upon the request of a Participant and based on a showing of financial hardship
caused by accident or illness, or by an event beyond the control of the
Participant, the Board may, in its sole discretion, vary the manner and time of
making the payments under section 4(g) from those provided for in the
Participant’s Deferred Compensation Agreement.
     (j) Deferred Compensation Agreements. Deferred Compensation Agreements
shall be entered into by the parties:
          (1) No later than June 15th and December 15th with respect to amounts
described in sections 4(c)(1) and 4(c)(2) which would otherwise be payable
during the next six calendar months;
          (2) With respect to entitlements under the Alleghany Corporation
Management Incentive Plan or any similar bonus plan, no later than December 15th
of the year prior to the year during which the bonus is earned;
          (3) With respect to entitlements under the Long-Term Incentive Plans,
(i) in the case of awards of performance shares, no later than September 1 of
the calendar year preceding the year in which the Participant would otherwise be
entitled to payment with respect

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to such performance shares, and (ii) in the case of other forms of awards, as
the Plan Administrator may designate;
          (4) With respect to any bonus referred to in section 4(c)(5), no less
than two weeks prior to the authorization of such bonus by Alleghany.
The Plan Administrator may prescribe forms of Deferred Compensation Agreement.
Deferred Compensation Agreements shall be executed on behalf of Alleghany either
by the Chairman of the Board or by the President of Alleghany, except that in
the case of a Deferred Compensation Agreement with the Chairman of the Board
such Deferred Compensation Agreement shall be executed on behalf of Alleghany by
the President of Alleghany and in the case of a Deferred Compensation Agreement
with the President such Deferred Compensation Agreement shall be executed on
behalf of Alleghany by the Chairman of the Board of Alleghany. Subject to the
provisions of section 5(h) hereof, Deferred Compensation Agreements may be
amended or modified by agreement of the Participant and Alleghany, including
amendments or modifications to extend or accelerate scheduled payments.
5. General Provisions.
     (a) This Plan is intended to constitute a plan which is unfunded and is
maintained by Alleghany primarily for the purpose of providing deferred
compensation for the directors, officers and certain highly compensated
employees of Alleghany, representing a select group of management or highly
compensated employees of Alleghany within the meaning of Sections 201(2),
301(a)(3) and 401(a)(1) of the Employee Retirement Income Security Act of 1974,
as amended. Nothing in the Plan shall create, or be construed to create, a trust
or fiduciary relationship of any kind between Alleghany and a Participant, his
designated beneficiary, or any

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other person. Any amounts deferred under the Plan shall be construed for all
purposes as a part of the general funds of Alleghany, and any right to receive
payments from Alleghany under the Plan shall be no greater than the right of any
unsecured general creditor. Alleghany may, but need not, purchase any securities
or instruments as a means of hedging its obligations to any Participant under
the Plan, but if it does, neither the Participant, his beneficiary nor any other
person shall have any interest therein or other right to such property. All
payments hereunder shall be made in cash and no Participant shall be entitled
hereunder to any shares of Alleghany Common Stock.
     (b) The right of any Participant to any amount payable pursuant to this
Plan shall not be assigned, transferred, pledged or encumbered except by the
laws of descent and distribution.
     (c) Participation in the Plan shall not be construed as conferring upon any
Participant the right to continue as a director of Alleghany or in the employ of
Alleghany as an executive or in any other capacity.
     (d) The Board may at any time, in its sole discretion, suspend the
availability of the Common Stock Account or impose limitations upon the
frequency and amount of transfers to and from the Common Stock Account.
     (e) No employee benefits to which a Participant would be entitled under any
other employee benefit plan or arrangement maintained by Alleghany for its
employees shall be decreased or modified because of the deferral of salary under
the Plan.
     (f) Payment by Alleghany to a Participant or to a Participant’s beneficiary
or beneficiaries, as designated or otherwise determined pursuant to the
provisions of the Plan, shall be binding on all interested parties and on such
Participant’s heirs, executors, administrators and

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assigns, and shall discharge Alleghany and its directors, officers and employees
from all claims, demands, actions or causes of action of every kind arising out
of or on account of such Participant’s participation in the Plan, known or
unknown, for himself, his heirs, executors, administrators and assigns.
     (g) Notwithstanding the provisions of sections 4(f) and 4(g) hereof, but
subject to section 5(h) hereof, all amounts described in sections 4(b) and 4(c)
hereof and credited to a Participant’s Prime Rate Account and/or an Officer
Participant’s Common Stock Account, together with interest and/or dividend
income accrued thereon, shall become immediately due and payable to such
Participant in the event of the liquidation of Alleghany or in the event that a
petition shall be filed or a case commenced in respect of Alleghany (by
Alleghany or by any other person) under Title 11 of the United States Code or
any other applicable Federal or state bankruptcy, insolvency or other similar
law, or that any court shall appoint a receiver, liquidator, trustee (or similar
official of Alleghany) or order the winding-up or liquidation of the affairs of
Alleghany, and such case or order shall continue unstayed and in effect for a
period of sixty consecutive days.
     (h) Notwithstanding any other provision hereof, the Plan Administrator
shall give effect to a transfer of amounts between a Common Stock Account and a
Prime Rate Account only if an Officer Participant directs such transfer by
written notice given to the Plan Administrator during the period beginning on
the third business day and ending on the twelfth business day following the
issuance by Alleghany of a press release setting forth its quarterly or annual
summary statement of sales and earnings (“Common Stock Account Transfer
Period”). An amendment or modification of a Payout Schedule set forth in a
Deferred Compensation Agreement providing for deferral of amounts described in
section 4(c) hereof and crediting of

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such amounts to a Common Stock Account shall be entered into by Alleghany and an
Officer Participant only during a Common Stock Account Transfer Period. The Plan
Administrator may establish other rules in respect of transfers of amounts to
and from Common Stock Accounts and execution of amendments to Deferred
Compensation Agreements providing for crediting of amounts to Common Stock
Accounts.
     (i) All amounts deferred under the Plan shall be subject to employment
taxes, and all payments shall be subject to income tax withholding, if
applicable. Each Participant shall make arrangements satisfactory to Alleghany
with respect to the collection of such taxes with respect to all amounts
deferred or payable hereunder.
     (j) The Plan is the successor plan to the Alleghany Corporation Deferred
Compensation Plan (the “Old Plan”). Accordingly, effective as of January 1,
2002, each separate book reserve account maintained by Alleghany pursuant to the
Old Plan as of the close of business on December 31, 2001, for each person who
is or was an officer or director (“Old Plan Participants”) shall be transferred
to, and shall become, a separate book reserve account for such Participant under
this Plan, and all amounts to which any such Old Plan Participant was therefore
entitled to under the Old Plan shall instead be paid pursuant to this Plan.
Further, each election and beneficiary designation of an Old Plan Participant in
effect under the Old Plan shall be given effect as if made pursuant to this
Plan. Finally, each reference to the Old Plan in any Deferred Compensation
Agreement of an Old Plan Participant shall be deemed to refer to this Plan.
     (k) The Board may designate officers of Alleghany Capital Partners LLC
(“ACP”) to participate in the Plan and accrue benefits hereunder as if such
officer were an officer of Alleghany (each an “ACP Participant”). During the
period an ACP Participant is an officer of

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ACP, such ACP Participant shall be treated as employee of Alleghany and a
Savings Benefit Participant and an Officer Participant for purposes of the Plan.

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