Document:

exv10w1

Exhibit 10.1

ALLEGHANY CORPORATION OFFICERS AND HIGHLY

COMPENSATED EMPLOYEES

DEFERRED COMPENSATION PLAN

(As Amended and Restated as of January 1, 2011)

     The Alleghany Corporation Officers and Highly Compensated Employees Deferred Compensation Plan
(the “Plan”), as amended and restated (and further revised) as of January 1, 2011, provides for an
unfunded savings benefit and an unfunded deferred compensation arrangement for officers and certain
highly compensated employees of Alleghany Corporation, a Delaware corporation (“Alleghany”). The
Plan is intended to be a plan which is unfunded and is maintained by Alleghany primarily for the
purpose of providing deferred compensation for a select group of management or highly compensated
employees both within the meaning, and for the purposes, of Sections 201(2), 301(a)(3) and
401(a)(1) of the Employee Retirement Income Security Act of 1974, as amended.

     All compensation deferred and savings benefits that were vested under the Plan on December 31,
2004, and the earnings credited thereon (whether before or after December 31, 2004) (the “Pre-409A
Amounts”) are subject to the provisions of this Plan in effect on December 31, 2004, (the “Pre-2005
Plan”). The Pre-409A Amounts will be separately accounted for, administered and paid solely in
accordance with the terms of the Pre-2005 Plan.

1. DEFINITIONS.

     For purposes of the Plan, in addition to the terms otherwise defined herein, the following
terms shall have the meanings as set forth below:

     (a) “Account” or “Accounts” shall mean the separate bookkeeping account or accounts
established and maintained by Alleghany pursuant to Section 8 in respect of each Participant.

     (b) “Board” means the Board of Directors of Alleghany.

     (c) “Base Salary” means the compensation paid (whether or not such compensation is currently
payable or deferred) to the Participant as base salary, which base salary shall not include (by way
of illustration and not limitation) any non-cash compensation, any savings benefit amounts, any
Incentive Compensation, any long term incentive bonuses, restricted stock, severance, termination
or separation pay or other extraordinary compensation, payments, fringes, allowances or
reimbursements.

     (d) “Beneficiary” means the person or persons last designated by a Participant, on a form
provided by, and filed with, the Committee, to receive any amounts payable to the Participant
hereunder following the Participant’s death. If all the persons so designated are

 

 

individuals and if there is no such individual living at the time of the death of the
Participant, or if no such person has been designated, then the Participant’s Beneficiary shall be
his estate.

     (e) “Book Value Percentage Change” shall mean the percentage change (carried to four places)
in common stockholders’ equity per share of Common Stock on a fully diluted basis determined in
accordance with generally accepted accounting principals consistently applied. Book Value
Percentage Change shall be determined from calendar year-end to calendar year-end on the basis of
Alleghany’s audited consolidated balance sheet in Alleghany’s Annual Report to Stockholders for the
latest such year-end; provided, however, that if the Book Value Percentage Change is to be
determined herein as of any fiscal quarter-end, then the percentage change (carried to four places)
in the common stockholders’ equity per share of Common Stock shall be measured from the most recent
fiscal year-end to the applicable quarter-end (based on the common stockholders’ equity per share
announced in Alleghany’s Quarterly Report on Form 10-Q as filed with the U.S. Securities and
Exchange Commission). In the event that (i) any cash dividends or other similar distributions
occur with respect to Common Stock or any rights offering, recapitalization, forward split or
reverse split, reorganization, merger, consolidation, spin- off, combination, repurchase or share
exchange, or other similar corporate transaction or event occurs that affects the common
stockholders’ equity per share of Common Stock but is not taken into account under generally
accepted accounting principals consistently applied and (ii) the Committee determines that an
adjustment in the Book Value Percentage Change is appropriate in order to prevent dilution or
enlargement of the rights of Participants under the Plan, then the Committee shall make such
equitable adjustment in the applicable Book Value Percentage Change as the Committee in its sole
discretion deems appropriate, and the determination of the Committee with respect thereto shall be
final and binding.

     (f) “Code” shall mean the Internal Revenue Code of 1986, as amended, and the Treasury
Regulations thereunder.

     (g) “Common Stock” shall mean the common stock, $0.10 par value, of Alleghany.

     (h) “Disabled” shall mean a determination that the Participant is unable to engage in any
substantial gainful activity by reason of any medically determinable physical or mental impairment
that can be expected to result in death or can be expected to last for a continuous period of not
less than 12 months or is, by reason of any medically determinable physical or mental impairment
that can be expected to result in death or can be expected to last for a continuous period of not
less than 12 months, receiving income replacement benefits for a period of not less than 3 months
under an accident and health plan covering employees of the service provider’s employer. A
Participant will be deemed Disabled if, and as of the date, determined to be totally disabled by
the Social Security Administration or in accordance with a disability insurance program of
Alleghany or any subsidiary, provided that the definition of disability applied under such
disability insurance program is consistent with this definition of “Disabled.”

     (i) “Incentive Compensation” shall mean compensation payable by Alleghany where the amount of,
or entitlement to, the compensation is contingent on the satisfaction of pre-

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established organizational or individual performance criteria relating to a performance period
of at least 12 consecutive months, and in most cases would include the compensation payable
pursuant to the Alleghany Corporation Management Incentive Plan and the Alleghany Corporation 2007
Long-Term Incentive Plan and any predecessor or successor annual or long-term incentive plans.
Compensation may be Incentive Compensation where the amount will be paid regardless of satisfaction
of the performance criteria due to the Participant’s death or disability, provided that a payment
made under such circumstances without regard to the satisfaction of the performance criteria will
not constitute Incentive Compensation and so payment will be made without giving effect to the
Deferral Election. Disability refers to any medically determinable physical or mental impairment
resulting in the Participant’s inability to perform the duties of his or her position or any
substantially similar position, where such disability can be expected to result in death or can be
expected to last for a continuous period of not less than 6 months.

     (j) “Separation from Service” shall mean the Participant’s termination of employment with
Alleghany, its subsidiaries and with each member of the controlled group (within the meaning of
Sections 414(b) or (c) of the Code) of which Alleghany is a member. A Participant will not be
treated as having a Separation from Service during any period the Participant’s employment
relationship continues, such as a result of a leave of absence granted by Alleghany (consistent
with the rules in Treasury Regulation Section 1.409A-1(h)(1)(i)), and whether a Separation from
Service has occurred shall be determined by the Committee (on a basis consistent with rules under
Section 409A of the Code) after consideration of all the facts and circumstances, including whether
either no further services are to be performed or there is a permanent and substantial decrease
(e.g., 80% or more) in the level of services to be performed (and the related amount of
compensation to be received for such services) below the level of services previously performed
(and compensation previously received).

2. ADMINISTRATION OF THE PLAN.

     The Plan shall be administered by the Compensation Committee of the Board (the “Committee”),
but that Committee may delegate to an officer of Alleghany (the “Plan Administrator”)
responsibility for the day-to-day administration of the Plan under the direction of the Committee.
The Committee shall have exclusive power to select the highly-compensated employees to participate
in the Plan and shall have the authority (which authority may be delegated to the Plan
Administrator subject to such restrictions and limitations as imposed by the Committee) to
establish, adopt and revise such rules, regulations, guidelines, forms and instruments relating to
the Plan as may be deemed necessary, advisable or appropriate for the administration and operation
of the Plan. Any reference in the Plan to the Committee shall be deemed to include the Plan
Administrator to the extent that the Committee has delegated any authority or responsibility
therefore to the Plan Administrator. The Committee’s interpretation and construction of the Plan
and all actions taken thereunder shall be binding on all persons for all purposes.

3.
PARTICIPATION.

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     Each employee who is elected or appointed as a corporate officer of Alleghany shall be
eligible to participate in the Plan (each a “Participant”) as of the date such employee was elected
or appointed by the Board, and any other highly compensated employee of Alleghany who is not a
corporate officer but who is designated by the Board to participate in the Plan shall also become a
Participant as of the date he or she is designated by the Board to participate in the Plan. A
person shall cease to be a Participant on the date the Participant receives all benefits to which
the Participant is entitled under the Plan.

4. ALLEGHANY SAVINGS BENEFIT CREDIT.

     On the last business day of each calendar quarter, Alleghany will credit to the Savings
Benefit Account of each person who was a Participant at any time during such calendar quarter an
amount equal to 3.75% of the Base Salary paid to such Participant during that calendar quarter
while he or she was a Participant (the “Savings Benefit Credit”). No amounts shall be credited to
a Savings Benefit Account in respect of a calendar quarter following the calendar quarter in which
a Participant has a Separation from Service, unless the Participant recommences employment with
Alleghany.

5. DEFERRAL ELECTIONS.

     (a) A Participant may make an election (a “Deferral Election”) to defer all or any part of the
Base Salary or Incentive Compensation that would be payable to the Participant in the absence of an
effective Deferral Election (the “Deferred Compensation”); provided, however, that a Participant
may not defer any amounts of the Participant’s Base Salary or Incentive Compensation that in the
absence of a Deferral Election would be paid to the Participant in the form of Common Stock. A
Participant’s Deferral Election to defer Base Salary must be made on or before, and such Deferral
Election will become irrevocable on, the December 31st preceding the calendar year in
which the Base Salary being deferred would be earned. A Participant’s Deferral Election to defer
all or any part of his or her Incentive Compensation must be made on or before, and such election
will become irrevocable on, the date which is six (6) months before the end of the performance
period applicable to such Incentive Compensation.

     (b) Notwithstanding the foregoing, in the case of the first year in which a Participant
becomes eligible to participate in the Plan, the Participant may make a Deferral Election within 30
days after the date the Participant becomes eligible to participate with respect to (i) Base Salary
paid for services to be performed subsequent to the date of the Deferral Election and (ii) in the
case of Incentive Compensation (or an amount that would be Incentive Compensation if the
performance period with respect to the Participant had been at least 12 months), so much of the
Incentive Compensation as is equal to (x) the total amount of the Incentive Compensation for the
performance period multiplied by the ratio of the number of days remaining in the performance
period after the Deferral Election over the total number of days in the performance period.

6. PAYMENT ELECTIONS.

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     (a) A Participant may affirmatively elect the time of payment or the time of commencement of
the payments from the Participant’s Account (a “Payment Election”), which time of payment (or if
annual installment payments are elected, the time for the commencement of payments) shall be the
first day of the month that is, or next follows, (A) a specified time or the occurrence of an event
that is objectively determinable (a “Specified Event Payment”), (B) the date of the Participant’s
Separation from Service (a “Separation from Service Payment”) or (C) the determination that the
Participant is Disabled (a “Disability Payment”). A Participant may elect a Specified Event
Payment, a Separation from Service Payment, a Disability Payment or any combination of payment
events, but if the Participant elects one or more payment events the Participant must specify
whether payment is to commence on the earliest or latest to occur of the Specified Event Payment,
the Separation from Service Payment and/or the Disability Payment. The elected time of payment (or
the time of commencement of the payments) is referred to herein as the “Payment Date.”

     (b) A Participant’s Payment Election shall specify whether payment will be made in a lump sum
on the Payment Date or in a number of annual installments (not more than 10) as specified, the
first such payment becoming payable on the Payment Date and each subsequent annual payment becoming
payable on the anniversary of that Payment Date (each subsequent annual payment becoming payable on
the anniversary of the Payment Date being referred to herein as the “Payment Date Anniversary”).
If a Participant has elected a Specified Event Payment, a Separation from Service Payment or a
Disability Payment in the alternative, the Participant may also elect alternative forms of payment
for the Specified Event Payment, the Separation from Service Payment and/or the Disability Payment.
In addition, if a Participant elects annual installments, the Participant may elect the method of
calculating the amount (which method must produce an amount that is objectively determinable) to be
paid on the Payment Date and each Payment Date Anniversary, but if the Participant fails to elect a
method of calculating the installments, the amount payable shall be determined in accordance with
Section 9(b) hereof.

     (c) All Payment Elections shall be subject to the following limitations and restrictions

	 	(i)	 	If the Payment Election relates to the time of payment of all
or any part of the Base Salary or Incentive Compensation that would have been
payable to the Participant in the absence of a valid Deferral Election, then
such Payment Election (A) shall be applicable only with respect to the
compensation deferred pursuant to such Deferral Election and (B) shall be made,
and shall become irrevocable, on the date the Deferral Election becomes
irrevocable.
	 
	 	(ii)	 	If the Payment Election shall apply to any Savings Benefit
Credit, then such Payment Election (A) shall be applicable only with respect to
the Savings Benefit Credit made in calendar years beginning after the calendar
year in which the Payment Election was made and (B) on December 31st
shall become irrevocable with respect to all Savings Benefit Credit

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	 	 	 	credited in any calendar year thereafter; provided, however, that the
Participant may make a new Payment Election applicable only with respect to
the Savings Benefit Credit made in calendar years beginning after the
calendar year in which the new Payment Election was made.
	 
	 	(iii)	 	If the Payment Date is a specified time or event, different
forms of payment (i.e., a lump sum or annual installments) may be
elected depending upon whether the Payment Date occurs on or before a specified
time.
	 
	 	(iv)	 	If the Payment Date is based upon a Separation from Service, a
different time and form of payment (i.e., a lump sum or annual
installments) may be designated depending upon whether (x) the Separation from
Service occurs before or after a specified date, (y) the Separation from
Service occurs before or after a combination of a specified date and a
specified period of service (measured from the Participant’s date of hire until
Separation from Service) determined under a predetermined, nondiscretionary,
objective formula, or (z) there is a Separation from Service not described in
the foregoing clauses (x) or (y).
	 
	 	(v)	 	No Payment Date may be elected (or if elected, will not be
given effect) with respect to an amount in a Savings Benefit Account or
Deferral Account that is later than 12 months after the date of the
Participant’s Separation from Service.

     (d) Notwithstanding the foregoing, each Participant who is credited under the Plan with any
amount in excess of the Participant’s Pre-409A Amount may, on or before December 31, 2008, make a
Payment Election (or may revoke any prior Payment Election and make a new Payment Election) with
respect to such amount (i.e., in excess of the Pre-409A Amounts) at any time on or before December
31, 2008, excluding any amount credited under the Plan that in the absence of such election would
otherwise be paid in 2008.

7. AMENDED PAYMENT ELECTIONS.

     (a) A Participant may make another election (an “Amended Payment Election”) to defer, but not
to accelerate, the amount payable on the Payment Date elected in accordance with Section 6 hereof
(or in the absence of a valid Payment Election, pursuant to Section 10(a) hereof). Each Amended
Payment Election shall be made in accordance with this Section 7 and shall cause the payments from
the Participant’s Account and attributable to such Payment Election to be made (or commence) at a
later Payment Date than such payment would have been made in the absence of such Amended Payment
Election.

     (b) For purposes of applying this Section 7, if a Participant has elected to have the
Participant’s Account paid in annual installments, then this Section 7 shall be applied as if the
amount to be paid on the Payment Date and on each subsequent Payment Date Anniversary were

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made pursuant to a separate Election, such that an Amended Payment Election to change the time
or form of an amount payable upon a Payment Date or any Payment Date Anniversary must separately
satisfy the requirements of this Section 7.

     (c) A Participant’s Amended Payment Election to be valid must satisfy the following
limitations:

	 	(i)	 	No Amended Payment Election shall take (or be given) effect
until twelve (12) months after the date on which such Amended Payment Election
is made.
	 
	 	(ii)	 	The Amended Payment Election must provide for a Payment Date
for the amount deferred by reason of the Amended Payment Election that is not
less than five (5) years after the date that the payment subject to the Amended
Payment Election would otherwise have been made.
	 
	 	(iii)	 	In the case of a Specified Event Payment, no Amended Payment
Election may be made if the payment, in the absence of the Amended Payment
Election would have been paid within twelve (12) months from the date of the
Amended Payment Election.

     (d) Except as set forth herein, a Participant’s Amended Payment Election may provide for
payment at any of the time or times or in any of the form or forms as could have been elected in an
original Election.

8. ACCOUNTS.

     (a) One Account for each Participant shall be denominated as a “Savings Benefit Account” and
shall reflect the Savings Benefit Credits made by Alleghany for the benefit of the Participant
pursuant to the Plan. If the Participant has made a Deferral Election with respect to any of the
Participant’s compensation, then a separate Account, denominated as the Participant’s Deferral
Account, shall also be maintained for such Participant. In addition, if the Participant shall make
different Payment Elections (or Amended Payment Elections) with respect to amounts credited either
to the Participant’s Savings Benefit Account and/or Deferral Account such that any amounts may be
paid at different times or in different forms, then separate subaccounts shall be established
within such Savings Benefit Account and/or Deferral Account, as the case may be, and each
subaccount shall reflect all credits, deferrals, earnings thereon and distributions therefrom, so
that all amounts in any subaccount shall be subject to the same Payment Election (or any Amended
Payment Election). For the avoidance of doubt, any reference in the Plan to a payment from an
Account (including, without limiting the generality of the foregoing, for purposes of Section 9
hereof) shall be deemed to refer to each subaccount independently. Each Account and any subaccount
shall exist solely for record keeping purposes and shall not represent any actual interest in any
assets of Alleghany or shares of Common Stock.

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     (b) All Savings Benefit Credits shall be credited to the Participant’s Savings Benefit Account
on the last business day of each calendar quarter. If a Participant has made a Deferral Election,
then any Deferred Compensation shall be credited to the Participant’s Deferral Account in
accordance with the administrative procedures established by the Plan Administrator from time to
time.

     (c) Unless a Participant has elected (and not subsequently revoked such election) to have all
or a portion of the amounts credited to an Account be (i) invested in Common Stock (a “Common Stock
Election”) or (ii) adjusted based on Book Value Percentage Change (a “Book Value Election”), then
the Account (or the balance in the Account, if applicable) shall be deemed to earn interest at the
Prime Rate, which credit shall be computed on and from the date an amount is credited to such
Account through the date an amount is distributed from the Account or a Common Stock Election or a
Book Value Election is implemented or becomes effective with respect to such amount, which interest
credits shall otherwise be compounded on an annual basis and credited to the Account as of the
December 31st of each year or, if earlier, the date the Account is liquidated. For these purposes,
the “Prime Rate” shall be the rate of interest announced by JP Morgan Chase Bank, N.A. from time to
time as its “prime rate” and as in effect 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.

     (d) If a Participant at any time or from time to time makes a Common Stock Election with
respect to all or any part of the balance in the Participant’s Account, after such Common Stock
Election is implemented such amount shall thereafter be treated as if such amount were instead
invested in Common Stock, reflecting the investment experience which the Account would have had if
the amount so designated had been invested in (without commissions or other transaction expenses)
whole or fractional shares of Common Stock during such period. Accounts credited with Common Stock
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 Common Stock
during the period such Common Stock is credited to the Account and any cash dividends and other
distributions (other than in the form of Common Stock) shall be deemed to purchase additional
Common Stock on the date of payment thereof. The number of whole or fractional shares of Common
Stock credited to, or debited from, an Account shall be based upon the mean between the high and
low prices of Common Stock on the applicable date on the New York Stock Exchange Consolidated Tape.

     (e) If a Participant makes a Book Value Election with respect to all or any part of the
balance in the Participant’s Account, after such Book Value Election becomes effective, such amount
shall thereafter be adjusted on a yearly basis by a percentage of such amount equal to the Book
Value Percentage Change for such year, until such amount, as so adjusted, is distributed from the
Account or the election is effectively revoked. A Book Value Election with respect to all or any
part of the balance in a Participant’s Account shall become effective as of January 1st
of the year following the year in which such election is made; provided, however, that in the case
of the first year in which a Participant becomes eligible to participate in the Plan, a Book Value
Election by such Participant shall become effective for such year if made within the first 30 days

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of the start of such year. If any Participant elects to revoke all or any part of a prior
Book Value Election, such revocation shall become effective as to such amount as of the close of
business on December 31st of the year in which such revocation is made (and the Book
Value Percent Change shall be given effect with respect to such amount for the year of such
revocation). If a Book Value Election is in effect with respect to any amount payable on a Payment
Date, the Book Value Percentage Change applicable to the amount payable on such Payment Date shall
be determined as of the most recent fiscal quarter-end preceding such Payment Date.

     (f) The Committee or the chief legal officer of Alleghany may establish, revoke or change from
time to time rules regarding the date or period for implementing the crediting to, or debiting
from, any Account any Common Stock, which rules may require that the crediting or debiting of
Common Stock shall be given effect only as of the date or during a period as the Committee or the
chief legal officer of Alleghany determines. The Committee or the chief legal officer may at any
time, in its or his sole discretion, suspend the availability of Common Stock as a notional
investment for an Account, impose limitations upon the frequency and amount of debits and credits
of Common Stock and otherwise prohibit such debits and credits, with or without advance notice to
Participants, as the Committee or the chief legal officer, as the case may be, deems necessary,
appropriate or advisable.

9. PAYMENT FROM ACCOUNTS.

     (a) If a Participant elects to have payment of the Participant’s Account made in annual
installments, the Participant’s Account shall continue to be credited with (i) the Prime Rate, (ii)
changes in the value of, and the distributions on, Common Stock, or (iii) adjustments based on the
applicable Book Value Percentage Change, all as the case may be, subject to such rules and
limitations as may be adopted by the Committee, until the installment payments are debited from the
Account.

     (b) Unless another objectively determinable method is specified in a Participant’s Election
pursuant to Section 6(c) hereof (or Amended Payment Election), if a Participant’s Account is
payable in annual installments, then the amount payable on the Payment Date or the Payment Date
Anniversary, as the case may be, shall be determined by dividing the value of the Account as of the
December 31st prior to the Payment Date or Payment Date Anniversary, as the case may be,
by the number of annual installments remaining to be made from the Account, including the payment
then due on such Payment Date or Payment Date Anniversary, as the case may be. If a Participant
elects annual installments of fixed dollar amounts, any amounts remaining in the Account shall be
paid to the Participant as of the last Payment Date Anniversary.

     (c) All payments shall be made in cash as promptly as practicable following the Payment Date
or Payment Date Anniversary and, in any event, on or before the later of (x) the last day of the
calendar year in which the Payment Date or Payment Date Anniversary occurs or (y) the date 2 1/2
months after such Payment Date or Payment Date Anniversary.

10. TIME OF PAYMENT IN CERTAIN CIRCUMSTANCES.

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     (a) Absence of Election. In the absence of an effective Payment Election with respect to any
Savings Benefit Credit or Deferred Compensation, a Participant will be deemed to have elected as a
Payment Date with respect to such Savings Benefit Credit or Deferred Compensation the first day of
the calendar month coinciding with or next following the Participant’s Separation from Service and
to have elected that such amount be paid in a lump sum.

     (b) Death. Notwithstanding any Participant’s Payment Election or any Amended Payment
Election, in the event that a Participant dies prior to the payment of the entire balance in the
Participant’s Account, then the balance in the Participant’s Account shall be paid in a lump sum to
the Participant’s Beneficiary on the first day of the calendar month coinciding with or next
following the date of the Participant’s death.

     (c) Delay for Specified Employees. Notwithstanding any other provision of this Plan to the
contrary, in the event that payment under the Plan is based upon or attributable to the
Participant’s Separation from Service and the Participant is at the time of the Participant’s
Separation from Service a “Specified Employee,” then any payment otherwise required to be made to
the Participant shall remain in the Account and be deferred and paid in a lump sum to the
Participant on the day after the date that is six (6) months from the date of the Participant’s
Separation from Service; provided, however, if the Participant dies prior to the expiration of such
six (6) month period, payment to the Participant’s beneficiary shall be made as soon as practicable
following the Participant’s death; and provided, further, that if the Participant has elected to
have his Account paid over ten (10) years in substantially equal payments, then instead of any
payments being deferred and such deferred payments being paid in a lump sum, commencement of the
payment of the Participant’s Account shall be deferred and commence on the day after the expiration
of such six-month period over the ten-year period elected by the Participant and this later date of
payment commencement shall be deemed to be the Payment Date for purposes of the Plan. A
Participant will be a “Specified Employee” for purposes of this Plan if, on the date of the
Participant’s Separation from Service, the Participant is 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 Treasury Regulation Section
1.409A-1(i). The Committee shall determine in its sole discretion all matters relating to who is a
“Specified Employee” and the application of and effects of the change in such determination.

     (d) Other Special Circumstances of Payment. Notwithstanding any restriction in the Plan to
the contrary, the Committee, in its sole and absolute discretion, may accelerate the time or
schedule of a payment under the Plan:

	 	(i)	 	to an individual (other than the Participant) as may be
necessary to fulfill a domestic relations order (as defined in Section
414(p)(1)(B) of the Code);
	 
	 	(ii)	 	as may be necessary to comply with applicable federal, state,
local or foreign ethics or conflicts of interest law; or

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	 	(iii)	 	to pay the Federal Insurance Contributions Act tax imposed
under Sections 3101, 3121(a) and 3121(v)(2) of the Code, where applicable, on
amounts deferred under this Plan (the “FICA Amount”) or to pay the income tax
at source on wages imposed under Section 3401 of the Code (or the corresponding
withholding provisions of applicable state, local, or foreign tax laws) as a
result of the payment of the FICA Amount, and to pay the additional income tax
at source on wages attributable to the pyramiding of the Section 3401 wages and
taxes (provided that the total payment does not exceed the aggregate of the
FICA Amount, and the income tax withholding related to such FICA Amount).

11. GENERAL PROVISIONS.

     (a) 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 or her Beneficiary, or any 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 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) 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 any Deferred Compensation under the Plan.

     (d) Payment by Alleghany to a Participant or to a Participant’s Beneficiary shall be binding
on all interested parties and on such Participant’s heirs, executors, administrators and 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.

     (e) All Savings Benefit Credits and Deferred Compensation 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 Savings Benefit Credits and Deferred Compensation hereunder, and
Alleghany shall have the right to deduct from all payments made hereunder any federal, state, local
or foreign income taxes required, in the sole judgment of Alleghany, to be withheld with respect to
such payments.

-11-

 

     (f) The validity and construction of the Plan shall be governed by the laws of the State of
Delaware, but without giving effect to the choice of law principles thereof.

     (g) Nothing contained in this Plan shall be deemed (i) to give any person the right to be
retained in the service of Alleghany or to be continued as a corporate officer of Alleghany or (ii)
to interfere with the right of Alleghany to discharge any person at any time without regard to the
effect which such discharge shall have upon his rights or potential rights, if any, under the Plan.

     (h) 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 ACP, such ACP
Participant shall be treated as employee of Alleghany and a Participant for purposes of the Plan.

12. AMENDMENT OR TERMINATION OF THE PLAN.

     The Board, without the consent of any Participant, may at any time terminate or from time to
time amend the Plan in whole or in part; provided, however, that no such action shall adversely
affect any rights or obligations with respect to payment under the Plan; and provided, further,
that no such action shall cause the Plan to violate Section 409A of the Code.

13. COMPLIANCE WITH SECTION 409A OF THE CODE.

     (a) The Plan is intended to be operated in compliance with Section 409A of the Code. If any
provision of the Plan is subject to more than one interpretation, then the Plan shall be
interpreted in a manner that is consistent with Section 409A of the Code.

     (b) All Deferral Elections, Payment Elections or Amended Payment Elections shall be in writing
and shall be effective as and when received by Alleghany pursuant to procedures established by the
Committee from time to time. An Amended Payment Election when received pursuant to such procedures
is irrevocable when received.

-12-exv10w2

Exhibit 10.2

TERMS AND PROVISIONS GOVERNING

2011 ACP INCENTIVE AWARDS

1. ACP INCENTIVE PROGRAM

     The ACP Incentive Program, of which the 2011 ACP Incentive Awards are part, is being
established by the Compensation Committee (“Compensation Committee”) of the Board of Directors of
Alleghany Corporation (the “Company”), pursuant to the Alleghany Corporation 2010 Management
Incentive Plan, to further the long-term growth of the Company and its subsidiaries by providing
incentives to select officers of the Company and the investment personnel of Alleghany Capital
Partners LLC (“ACP”), a wholly owned subsidiary of the Company, who are largely responsible for
group-wide equity investments of the Company and its subsidiaries. Pursuant to the ACP Incentive
Program, commencing in 2012, it is expected that successive annual incentive awards will be made
with performance criteria comparable to the 2011 ACP Incentive Awards and with payouts over the
three years following the expiration of the relevant three-year period, effectively creating a
rolling three-year incentive program. In order to transition into a rolling three-year incentive,
the 2011 ACP Incentive Awards provide for interim payouts in respect of performance during 2011 and
2012.

2. CREATION AND MEASUREMENT OF 2011 ACP INCENTIVE POOL

     (a) A portfolio of Qualifying Assets held for investment for the benefit of the Company, and
its subsidiaries, including Alleghany Insurance Holdings LLC, all of which are subject to the
investment management of ACP, shall be identified in writing by the Compensation Committee by no
later than January 30, 2011 (the “2011 Qualifying Assets” or “2011 QA”). Thereafter during the
2011 Performance Period, Qualifying Assets may be withdrawn from, but may not be added to, the 2011
Qualifying Assets; provided, however, that if the Company elects to withdraw any Qualifying Assets
from the 2011 Qualifying Assets to effectuate an acquisition by the Company (or any entity
controlled by the Company) of the stock or assets of another entity and the proposed acquisition is
not thereafter consummated for any reason, the Company may (within 30 days of the termination of
the proposed acquisition) re-contribute Qualifying Assets equal to all or any amount of the Fair
Market Value of the Qualifying Assets withdrawn (valued on the date withdrawn) to the 2011
Qualifying Assets. Assets, whether or not constituting Qualifying Assets, managed by ACP that are
not in the 2011 Qualifying Assets shall not be taken into account for any purpose of the 2011 ACP
Incentive Awards. In the event that any assets in the 2011 QA are not Qualifying Assets, such
Non-qualifying Assets shall be withdrawn from the 2011 QA.

 

 

     (b) The “2011 Performance Period” shall be the period beginning on January 1, 2011 and ending
on December 31, 2013.

     (c) “Performance Value Added” or “PVA” shall equal the amount determined, as provided in
Exhibit A hereto, for the 2011 Performance Period (or such shorter period as may be provided in
Section 4 hereof for interim payouts).

     (d) Subject to the provisions of Section 4 hereof for determining interim payouts, the “2011
ACP Incentive Pool” shall be an amount equal to 5% of PVA.

     (e) “Qualifying Assets” shall mean cash, any shares of any mutual or other regulated fund
regularly reported in The Wall Street Journal, any shares of stock or other equity interests or any
notes, bonds or other interest bearing instruments in each case regularly traded on a
nationally-recognized domestic or foreign exchange or dealer quotation system and for which market
quotations are readily available.

3. PARTICIPANT’S SHARE OF PVA2

     (a) The Committee has established a share, expressed as a percentage of the 2011 ACP Incentive
Pool which is allocable to each recipient of a 2011 ACP Incentive Pool Award (a “Share Award”), as
set forth on Exhibit B attached hereto; provided, however, that the Share Award of any participant
may be increased or decreased by the Committee in its sole discretion for the calendar year 2012
and/or 2013 at any time prior to January 30th of such calendar year; provided further,
that the Share Award of any participant granted as a Qualifying Incentive may not be increased (but
may be decreased) over the Share Award granted to the participant as set forth in Exhibit B. Each
recipient of a Share Award shall receive written notice of such award and a copy of the Terms and
Provisions Governing 2011 ACP Incentive Awards.

     (b) If the Share Award awarded to any participant for all or any part of the 2011 Performance
Period is a Qualifying Incentive, then notwithstanding any provision of the terms and provisions of
this 2011 ACP Incentive Award, the maximum amount payable to such participant in any calendar year
shall not exceed $5,000,000 less the amount theretofore paid to the participant in such calendar
year under any other Qualifying Incentive granted pursuant to the 2010 Management Incentive Plan.
If the Share Award awarded to any participant for all or any part of the 2011 Performance Period is
a Qualifying Incentive, then as a condition to the acceptance of any payment, the participant
agrees that the maximum amount payable to such participant pursuant to all Qualifying Incentives
awarded under the 2010 Management Incentive Plan in any calendar year shall not exceed $5,000,000.

 

 

4. FORM AND TIMING OF PAYMENTS TO PARTICIPANTS OF SHARE AWARD

     The 2011 ACP Incentive Awards initiate the ACP Incentive Program. Pursuant to such Program,
commencing in 2012, the Company intends to establish successive annual incentive awards with
performance criteria comparable to the 2011 ACP Incentive Awards and with payouts over the three
years following expiration of the relevant three year performance period. In order to integrate
the 2011 ACP Incentive Award with future awards under the ACP Incentive Program, the Committee has
determined that interim payouts shall be made pursuant to the 2011 ACP Incentive Awards in respect
of 2011 and 2012 based on incentive pools calculated on the basis of PVAs for 2011 and 2012,
respectively the “2011 Short Period Pool” and the “2012 Short Period Pool.” Thus, the 2011 Short
Period Pool is equal to the one year PVA computed at the end of 2011 (the “2011 Short Period”)
multiplied by 5%. The 2012 Short Period Pool is equal to the two year PVA computed at the end of
2012 (the “2012 Short Period”) multiplied by 5%. The 2011 ACP Incentive Pool is equal to the three
year PVA computed at the end of 2013 multiplied by 5%.

     By way of illustration: (a) if the 2011 PVA was $5 million, then the 2011 Short Period Pool
would be $250,000; (b) if the 2012 PVA was negative $1 million and thus the PVA for both 2011 and
2012 was $4 million, then the 2012 Short Period Pool would be $200,000; and (c) if the 2013 PVA was
$5 million and thus the three-year PVA was $9 million, then the 2011 ACP Incentive Pool would be
$450,000. As provided for in 4(a) below, this illustration would provide a 2011 Payment to all
participants of $250,000, a 2012 Payment to all participants of zero, and a 2013 Payment to all
participants of $200,000, representing a sum of $450,000 for all three payments. In the event that
2011 ACP Incentive Pool is less than the sum of the 2011 and 2012 Payments, it is intended that
such difference will be deducted from payments to be made pursuant to the 2012 ACP Incentive
Awards. Notwithstanding the foregoing, for purposes of determining the 2011 Payments, as defined
below, the 2011 Short Period Pool shall not exceed $1 million and for purposes of determining the
2012 Payments, as defined below, the 2012 Short Period Pool shall not exceed $2 million (resulting
in maximum aggregate 2011 and 2012 Payments of $2 million). In the event that the ACP 2011
Incentive Pool, as determined hereunder at the end of the 2011 Performance Period, would exceed $5
million, the Committee, in its discretion, may reduce the ACP 2011 Incentive Pool to a level not
less than $5 million.

     (a) Subject to the foregoing limitations, each recipient of a Share Award shall be entitled to
payment on account thereof in an amount equal to:

 

 

	 	(1)	 	the recipient’s Share Award times the 2011 Short Period Pool
(the “2011 Payment”);
	 
	 	(2)	 	the excess of (i) the recipient’s Share Award times the 2012
Short Period Pool over (ii) the participant’s 2011 Payment (the “2012
Payment”); and
	 
	 	(3)	 	the excess of (i) the Share Award times the ACP 2011 Incentive
Pool over (ii) the sum of the participant’s 2011 Payment and 2012 Payment (the
“2013 Payment”).

Notwithstanding any other provision of these terms and provisions to the contrary, no participant
whose Share constitutes a Qualifying Incentive shall have any entitlement to, and shall not be
paid, any amount in respect of his Share unless and until the Committee certifies in writing that
the performance goals for each such payout in respect of such Share Award have been achieved.

     (b) Except as otherwise determined by the Committee, if a participant’s Share Award for the
calendar year 2012 and/or 2013 is more or less than the Share Award initially established for the
participant, then in computing the amount payable to the participant pursuant to paragraphs (2) or
(3) of Section 4(a), the Share Award shall be the Share Award as in effect for 2012 or 2013, as the
case may be. By way of illustration, (a) if a participant’s Share Award for 2011 was 10% and the
2011 Short Period Pool were $1 million, the 2011 payout for such participant would be $100,000 (10%
of $1 million), and (b) if such participant’s Share Award was reduced in 2012 from 10% to 7.5% and
the 2012 Short Period Pool were $2 million, the 2012 payout for such participant would be $75,000
(7.5% of $2 million, less a deemed 7.5% payout of $75,000 for 2011), and (c) if such participant’s
Share Award was increased in 2013 from 7.5% to 10% and the ACP 2011 Incentive Pool were $3 million,
the 2013 payout for such participant would be $100,000 (10% of $3 million, less the $200,000 of
deemed prior payouts).

     (c) Payments to participants pursuant to Section 4(a) on account of their Share Awards for
the 2011 Short Period, the 2012 Short Period and the 2011 Performance Period shall be made by the
Company in cash as soon as practicable after (but in any event by the March 15th
following) the completion of the Company’s audited financial statements for the calendar year in
which the 2011 Short Period, the 2012 Short Period or the 2011 Performance Period, as the case
maybe, ends.

     (d) Notwithstanding anything to the contrary and except as the Committee may otherwise
determine, any payment of a participant’s Share Award in respect of the 2011 Performance Period
(including the 2011 Short Period or the 2012 Short Period, as the

 

 

case maybe) shall be conditional upon such participant remaining continuously in the employ of the
Company, or a successor, subsidiary or controlled company thereof, throughout the date of payment.
In the event a participant’s employment by the Company (or a successor, subsidiary or controlled
company thereof) is terminated as a result of death or disability (in each case, as conclusively
determined by the Committee) prior to the end of the 2011 Performance Period, a participant (or in
the event of the participant’s death, the participant’s beneficiary designated in a writing
delivered to the Company) shall be entitled to a payment in accordance with the terms of his Share
Award at the times herein provided, except that the amount payable in respect of his Share Award
shall be reduced on a pro rata basis to reflect the portion of the 2011 Performance Period in which
such service continued.

5. MISCELLANEOUS PROVISIONS

     (a) The 2011 ACP Incentive Awards, shall be administered by the Compensation Committee of the
Board of Directors of Alleghany Corporation. The Committee’s interpretation of the 2011 ACP
Incentive Awards shall be final and binding on all parties involved, including Alleghany, ACP and
the participant. The terms, construction and performance of the foregoing provisions, and the
rights conferred thereby, shall be governed in all respects by, and subject to, the provisions of
the Company’s 2010 Management Incentive Plan and, in the event of any inconsistency, the provisions
of the 2010 Management Incentive Plan shall be controlling, including the Committee’s authority to
interpret and apply the 2010 Management Incentive Plan.

     (b) The Committee in its sole discretion may modify, amend or revise the terms and provisions
of these 2011 ACP Incentive Awards provided that, except to the extent necessary to correct any
omission or resolve any ambiguity, such modification, amendment or revision shall not reduce the
payment that would be made to such participant under the terms and provisions in effect prior to
such modification, amendment or revision if the 2011 Performance Period ended on the effective date
of such modification, amendment or revision. Notwithstanding the foregoing, no modification or
amendment may result in an increase in the amount payable pursuant to any Qualifying Incentive in
the absence of such modification, amendment or revision.

     (c) No participant has the right to be granted any Share Award for any performance period
subsequent to the 2011 Performance Period.

     (d) All questions pertaining to the construction, validity and effect of the provisions of the
2011 ACP Incentive Awards shall be determined in accordance with the laws of the State of New York.

 

 

Exhibit A

Calculation of Performance Value Added

     1. The 2011 QA have been identified by the Compensation Committee as provided in Section 2(a)
of the 2011 ACP Incentive Awards.

     2. The Benchmark Assets portfolio (“BA”) is a hypothetical portfolio with the same balance on
1/1/11 as the 2011 QA.

     3. The monthly total return on 2011 QA, whether a positive or negative amount, is the monthly
total return performance statistic produced by General Re-New England Asset Management, Inc. on the
2011 QA as published by them on their website and calculated in accordance with the Performance
Presentation Standards of the CFA Institute.

     4. The monthly total return on BA (Benchmark Return — “BR”), whether a positive or negative
amount, is the monthly total return on the S&P 500, as posted on the Bloomberg Professional service
of Bloomberg Finance L.P. under the ticker “SPTR.”

     5. At each month’s end, calculate the new 2011 QA balance as 2011 QA beginning balance times
(1 + month’s total return). This should equal the 2011 QA at that time.

     6. At each month’s end, calculate the new BA balance as BA beginning balance times (1 + BR).

     7. Month’s Performance Value Added (“Monthly PVA”), whether a positive or negative amount,
equals the month ending 2011 QA balance minus the ending BA balance.

     8. The PVA at any time is the sum of each Monthly PVA during the 2011 Performance Period (or
such shorter period as may be provided in Section 4 of the 2011 Incentive Awards for interim
payouts).

     9. If there is a contribution or withdrawal (“Transaction”) to the 2011 QA as provided in
Section 2(a) of the 2011 ACP Incentive Awards, a mirrored addition or deduction is made to the BA.

     10. In the event of any Transaction, the BA ending balance in the month of the Transaction
will be calculated in two parts on a daily basis with the first part following the calculation in
paragraph 6 above using the beginning BA balance and BR through the date of the Transaction,
creating an interim BA; and the second part following the calculation in paragraph 6 above using
the interim BA and the BR from the date of the Transaction through the end of the month.

 

Exhibit B

2011 ACP Incentive Awards

	 	 	 	 	 
	Participant	 	Share Award
	 
	 	 	 	 
	Qualifying Awards:
	 	 	 	 
	Weston M. Hicks
	 	 	50	%
	 
	 	 	 	 
	Non-qualifying Awards:
	 	 	 	 
	ACP Staff Aggregate % Awards
	 	 	42.5	%
	Subtotal
	 	 	92.5	%
	Reserved
	 	 	7.5	%

-18-

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