Document:

EX-10.1

 

 Exhibit 10.1

ALLEGHANY CORPORATION RETIREMENT PLAN

(As Amended and Restated Effective December 31, 2007)

     This document sets forth the Alleghany Corporation Retirement Plan, as amended and restated
effective as of December 31, 2007, among other things, to comply with the requirements of Section
409A of the Code.

     The Plan, as so amended and restated, is intended to be a plan which is unfunded and is
maintained by Alleghany Corporation 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.

     The rights under the Plan of any person who retired or otherwise terminated employment with
Alleghany Corporation before the effective date of a particular amendment shall be determined
solely under the terms of the Plan as in effect on the date of such retirement or other termination
of employment, without regard to such amendment, except that such person’s benefit under the Plan
may be paid at such time, and in such form, as may be permitted under the terms of the Plan as in
effect on the date as of which the payment of such person’s benefit commences.

ARTICLE I.

DEFINITIONS

     1.01 “Actuarial Equivalent” means with respect to a retirement benefit, an equivalent
amount or amounts computed using (i) the mortality table prescribed in Section 417(e)(3)(A)(ii)(I)
of the Code and (ii) the interest rate prescribed by the Internal Revenue Service under Section
417(e)(3)(A)(ii)(II) of the Code for the month immediately preceding the month in which such
Actuarial Equivalent is being determined.

     For purpose of this Section 1.01, all references to Section 417(e)(3) of the Code shall be
administered without regard to the effects enacted under the Pension Protection Act of 2006. In
addition, at such time as the Internal Revenue Service ceases to publish the relevant interest
rate, the determination of an Actuarial Equivalent shall instead be computed using the U.S. 30-year
Treasury rate in effect at the close of the first business day of the month in which such Actuarial
Equivalent is being determined.

     1.02 “Alleghany” means Alleghany Corporation and, solely for purposes of determining
the date of a Participant’s Termination of Employment (other than by reason of his ceasing to be an
officer), includes any corporation or other person treated as a single employer with Alleghany
Corporation under Section 414(b) or (c) of the Code.

     1.03 “Annuity Starting Date” means the first day on which an amount is payable to the
Participant in accordance with this Plan.

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     1.04 “Average Compensation” means, with respect to any Participant, the annual average
of his Base Compensation and his Short-Term Incentive Compensation for the three consecutive
calendar years in the period of ten calendar years ending with the calendar year in which he has a
Termination of Employment, which results in the highest such average.

     1.05 “Base Compensation” means the base salary earned by an Employee for the relevant
period (whether or not such compensation is currently payable or deferred) for his services as
such, which base salary shall not include (by way of illustration and not limitation) any non cash
compensation, any savings benefit amounts, (any Short-Term Incentive Compensation), long term
incentive bonuses, restricted stock or other extraordinary compensation, payments, allowances or
reimbursements.

     In the case of a Participant who becomes Totally Disabled, the Participant shall be treated as
earning Base Compensation, for the period which begins on the date on which he becomes Totally
Disabled, continues while he is Totally Disabled and which ends no later than his Normal Retirement
Date, at an annual rate which is equal to his annual rate of base salary immediately prior to the
date on which he becomes Totally Disabled. Such amount shall be adjusted on the first day of each
Plan Year included in such period to take into account the percentage increase, if any, in the CPIU
over the previous Plan Year. The “CPIU” is the U.S. City Average All Items Consumer Price Index
for all Urban Consumers, published by the U.S. Department of Labor, Bureau of Labor Statistics, or
any successor index designated by the Department of Labor.

     1.06 “Beneficiary” means the person or persons last designated by a Participant, on a
form provided by, and filed with, the Plan Administrator, to receive benefits under Article V
following the Participant’s death. If all the persons so designated are individuals and if there
is no such individual living at the death of the Participant, or if no such person has been
designated, then the Participant’s Beneficiary shall be his estate.

     1.07 “Board” means the Board of Directors of Alleghany or the Executive Committee
thereof.

     1.08 “Code” means the Internal Revenue Code of 1986, as amended.

     1.09 “Committee” means the Compensation Committee of the Board.

     1.10 “Early Retirement Date” means, with respect to any Participant, the first day of
the calendar month coinciding with or next following the latest of (a) the date on which he incurs
a Termination of Employment, (b) the date on which he attains age 55, (c) the date (not later than
his Normal Retirement Date) elected by him (where such election is made in accordance with Section
5.07), or (d) completion of 5 years of service.

     1.11 “Employee” means any individual in the employ of Alleghany. No person who is
engaged by, or performs services for, Alleghany pursuant to any agreement or arrangement
designating such engagement or services as that of a “consultant,” “independent contractor” or
other words of similar meaning shall be deemed an Employee.

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     1.12 “Employment Commencement Date” means the first day on which an Employee is
employed as a common-law employee by Alleghany.

     1.13 “ERISA” means the Employee Retirement Income Security Act of 1974 and the
regulations thereunder, as from time to time amended and in effect.

     1.14 “Late Retirement Date” means the first day of the calendar month coinciding with
or next following the date on which a Participant incurs a Termination of Employment after his
Normal Retirement Date.

     1.15 “Normal Retirement Date” means the first day of the calendar month coinciding
with or next following the first date on which a Participant has attained at least age 65 and has
completed at least 5 Years of Service.

     1.16 “Participant” means an Employee who has been selected to participate in the Plan
as provided in Article II or who has any accrued retirement benefits under the Plan which have not
been distributed in full to him (or his Beneficiary).

     1.17 “Plan” means the plan set forth herein as modified or amended from time to time.

     1.18 “Plan Administrator” means the person serving from time to time as the Treasurer
of Alleghany, or if no person is so serving at the time of reference, then Alleghany.

     1.19 “Plan Year” means a calendar year.

     1.20 “Separation from Service” shall mean the Participant’s termination of employment
with Alleghany, its subsidiaries and 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 for which 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).

     1.21 “Short-Term Incentive Compensation” means the amount of the cash bonus accrued by
an Employee in respect of the relevant period (whether or not such amount is currently paid or
deferred) under the Alleghany Management Incentive Plan (or any plan adopted by the Board in
replacement of such plan).

     In the case of a Participant who becomes Totally Disabled, the Participant shall be treated

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as accruing Short-Term Incentive Compensation for the period which begins on the date on which he
becomes Totally Disabled, continues while he is Totally Disabled and which ends no later than his
Normal Retirement Date (the “Disability Period”), at an annual rate which is equal to his average
annual rate of Short-Term Incentive Compensation. For this purpose, a Participant’s average annual
rate of Short-Term Incentive Compensation shall mean the average of his Short-Term Incentive
Compensation for the three consecutive calendar years in the period of the ten calendar years which
immediately precedes the date he becomes Totally Disabled and which results in the highest such
average, or if he had not been employed by the Alleghany for at least 3 complete, consecutive
calendar years, then the annual average of his Short-Term Incentive Compensation for all full
calendar years during which he was so employed. Such average annual rate of Short-Term Incentive
Compensation shall be adjusted, for each calendar year in the Disability Period, to take into
account the percentage increase, if any, in the CPIU (as defined in Section 1.05) over the previous
calendar year.

     1.22 “Spouse” shall mean the person to whom the Participant is lawfully married under
applicable law at the time of reference.

     1.23 “Termination of Employment” means and an Employee shall be treated as having
incurred, a termination of employment as of the first date on which he ceases for any reason to be
an officer of Alleghany, as provided in the By Laws of Alleghany. A Participant who becomes
Totally Disabled shall not be treated as having incurred a Termination of Employment for any
purpose of the Plan until the earliest of the date on which he ceases to be Totally Disabled
(assuming he does not resume his employment with Alleghany on such date), his Normal Retirement
Date or the date of his death.

     1.24 “Totally Disabled” means a physical and/or mental incapacity of such condition
that it qualifies an individual (after the waiting period required thereunder) for benefits under
the Alleghany Corporation Group Long Term Disability Plan, as in effect from time to time;
provided, however, that a Participant shall for purposes of this Plan cease to be Totally Disabled
as of the date the Participant’s retirement benefits commence under the Plan.

     1.25 “Year of Service” shall mean as to any Participant, the number of whole or
fractional periods of 12 consecutive months (such fraction being computed on the basis of complete
months) which are included in the period which begins on the date on which he first became a
Participant and which ends on the date of his final Termination of Employment (which, for the
avoidance of doubt, shall include the period while he is Totally Disabled). The Board may, by
resolution, grant additional Years of Service to a Participant for such period prior to the date he
first became a Participant as the Board shall determine, which grant shall be set forth opposite
the Participant’s name on Exhibit II attached hereto. Further, a Participant employed prior to the
effective date of the Plan, January 1, 1989, shall be credited with that additional number of Years
of Service which is set forth opposite his name on Exhibit I attached hereto.

ARTICLE II.

PARTICIPATION

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     2.01 Participation. Each Employee who has been elected by the Board to the position
of an officer of Alleghany, as provided in the By Laws of Alleghany, and who is designated by the
Board to participate in the Plan shall become a Participant effective on the later of his
Employment Commencement Date or the date specified by the Board.

     2.02 Re-Employment of Former Participant. If a Participant or former Participant who
incurred a Termination of Employment shall again become an Employee and he is again designated by
the Board to participate in the Plan, such Employee shall again become a Participant or resume his
active participation in the Plan, as applicable, effective on the later of the date of his
re-employment or the date specified by the Board. A Participant or former Participant who again
becomes an Employee, but is not designated by the Board to participate in the Plan, shall not again
become (or resume being) a Participant and his Years of Service and Base Salary and Short-Term
Incentive Compensation during his subsequent period of employment shall be disregarded in
calculating his benefits under this Plan.

ARTICLE III.

VESTING AND BENEFIT ENTITLEMENT

     3.01 Vesting and Entitlement. A Participant shall have a nonforfeitable right to 100
percent of, and shall be entitled to receive, his retirement benefit as determined pursuant to
Article IV if he has completed at least 5 Years of Service.

     3.02 Termination before Vesting. A Participant who terminates his employment with
Alleghany before he has completed at least 5 Years of Service shall not be entitled to any
retirement benefit under this Plan unless he is thereafter re employed by Alleghany and completes
at least 5 Years of Service.

ARTICLE IV.

RETIREMENT BENEFITS

     4.01 Retirement Benefit at Normal Retirement Date. The annual retirement benefit of a
Participant, calculated as a monthly annuity which starts on the Participant’s Normal Retirement
Date, is payable to the Participant for his life, and after the Participant’s death continues to
the Participant’s Spouse, if any, for her life in the same monthly amount as was being received by
the Participant, shall equal the product of (i) 66.67% of the Participant’s Average Compensation,
(ii) a fraction, not greater than one, the numerator of which is the number of his whole and
fractional Years of Service and the denominator of which is 15 and (iii) an Actuarial Equivalent
factor, not greater than 1, to reflect the additional value of the Spouse’s benefit on account of
the number of years and months, if any, by which the Spouse is younger than the Participant.

     4.02 Reduction for Prior Distributions. In the case of any Participant identified on
Exhibit III who received a prior distribution of retirement benefits, the Participant’s annual
retirement benefit otherwise payable under Article IV shall be offset by the Actuarial Equivalent
of amounts shown in Exhibit III.

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     4.03 Retirement Benefit at Late Retirement Date.

     If a Participant terminates employment with Alleghany after his Normal Retirement Date, then
such Participant shall be entitled to receive the greater of:

     (a) the annual retirement benefit determined in accordance with the formula in Section
4.01, reduced (if applicable) as set forth in Section 4.02, based on the Participant’s Years
of Service and Average Compensation calculated as of his Normal Retirement Date, then (i)
increased from the Participant’s Normal Retirement Date until his Annuity Starting Date
using the rate of interest in effect at the close of the first business day of each such
calendar year for U.S. Treasury obligations with a then maturity date of one year and then
(ii) increased or decreased, as the case may be, by the ratio of the Actuarial Equivalent
lump sum factor as in effect on the Participant’s Normal Retirement Date to the Actuarial
Equivalent lump sum factor as in effect on the Participant’s Late Retirement Date; or

     (b) the annual retirement benefit determined in accordance with the formula in Section
4.01, reduced (if applicable) as set forth in Section 4.02, based on the Participant’s Years
of Service and Average Compensation calculated as of his Late Retirement Date.

     4.04 Retirement Benefit at Early Retirement Date. The annual retirement benefit
payable to a Participant whose retirement benefit commences prior to his Normal Retirement Date
shall equal the annual retirement benefit determined in accordance with the formula in Section
4.01, further adjusted as follows:

     (a) if the Participant terminated his employment with Alleghany either (i) on or after
attaining age 55 and completing at least 20 Years of Service or (ii) on or after attaining
age 60 and completing at least 10 Years of Service, then his annual retirement benefit shall
be reduced by 3% for each year (interpolated for fractional years) by which his Annuity
Starting Date is prior to the date he would attain his Normal Retirement Date;

     (b) in all other cases, his annual retirement benefit shall be reduced by 6% for each
year (interpolated for fractional years) by which his Annuity Starting Date is prior to the
date he would attain his Normal Retirement Date; and

     (c) reduced, if applicable, as set forth in Section 4.02.

ARTICLE V.

FORMS OF RETIREMENT BENEFITS

     5.01 Calculation of Amount of Benefit Payments. The actual amount of a Participant’s
retirement benefit distribution under this Article V in the form elected shall be the Actuarial
Equivalent of the annual retirement benefit payable to the Participant as of the Participant’s

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Annuity Starting Date pursuant to Section 4.01, 4.03 or 4.04, as applicable to the Participant,
including taking account of the actual age of the Participant’s Spouse, if any.

     5.02 Automatic Form of Benefit.

     (a) Unless he shall make a valid election to the contrary in accordance with the Plan,
a Participant who is married on his Annuity Starting Date shall receive a retirement benefit
for his life payable monthly beginning on his Annuity Starting Date, with such monthly
annuity continued to the Participant’s Spouse (if she has survived him) for the remainder of
her life in the same monthly amount as the Participant was receiving prior to his death.
For purposes of this Plan, an individual will not be treated as the Participant’s Spouse
unless she was lawfully married to the Participant on his Annuity Starting Date (or, in the
case of a Participant’s death prior to his Annuity Starting Date, on his date of death).

     (b) Unless he shall make a valid election to the contrary in accordance with the Plan,
a Participant who is not married on his Annuity Starting Date shall receive his retirement
benefit as monthly annuity payments which shall begin on his Annuity Starting Date and shall
continue for as long as the Participant lives after payments begin.

     5.03 Optional Forms. In lieu of the form of benefit provided for by Section 5.02, a
Participant may elect as provided in the Plan to receive his retirement benefit in any of the
following optional forms:

     (a) a single life annuity option, under which the Participant’s retirement benefit
shall consist of monthly payments which shall begin on his Annuity Starting Date and shall
continue for as long as the Participant lives after payments begin;

     (b) a period certain annuity option, under which the Participant shall receive a
retirement benefit payable in equal monthly installments during his lifetime and ending with
the payment due on the first day of the month in which the Participant’s death occurs, but
with the provision that not less than 120 monthly installments shall be made to him and his
Beneficiaries;

     (c) a joint and survivor annuity option, under which a Participant shall receive a
monthly retirement benefit for his life beginning on his Annuity Starting Date with a
survivor annuity for the life of his Beneficiary which is equal to 50% or 100%, as he shall
have elected, of the monthly benefit for the Participant’s life; or

     (d) a lump sum option, under which the Participant shall receive a single lump sum
payment equal to the retirement benefit to which he is then entitled.

     5.04 Death Benefit for Spouse.

     (a) If a Participant has completed at least 5 Years of Service, dies before his

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Annuity Starting Date and is survived by a Spouse (a “Surviving Spouse”), then his Surviving
Spouse shall receive an annuity for the life of the Surviving Spouse which shall be the same
as the amount of the benefit that would have been paid to such Surviving Spouse under
Section 5.02(a) if (i) in the case of a Participant who dies after attaining age 55, the
Participant had retired on the day before his death; or (ii) in the case of a Participant
who dies on or before attaining age 55, the Participant had separated from service on the
date of his death, survived until age 55, and retired at that time.

     (b) In the case of a Participant who dies after attaining age 55, such benefit to the
Surviving Spouse shall commence as of the first day of the month coinciding with or next
following the date of the Participant’s death, or, in the case of a Participant who dies on
or before attaining age 55, such benefit to the Surviving Spouse shall commence on the first
day of the month coinciding with or next following the date the Participant would have
attained age 55.

     5.05 Commencement of Benefits; Payments to Specified Employees.

     (a) Unless he shall elect to the contrary as provided herein, payment of a
Participant’s retirement benefit shall commence on the first day of the calendar month
coinciding with or next following the later of (x) the date the Participant has a Separation
from Service or (y) the date the Participant attains his Normal Retirement Date.

     (b) Notwithstanding any other provision of this Plan to the contrary, in the event that
payment of the Participant’s retirement benefit 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 (i) payment of the
Participant’s retirement benefits under this Plan shall commence as of the first day of the
month that is more than six months after his Separation from Service, and (ii) the aggregate
amount of any retirement benefit payments that would have been made to the Participant in
the absence of clause (i) shall be paid to the Participant in a lump sum on the date the
payment of his retirement benefit commences under clause (i) with interest on each such
retirement benefit payment deferred from the date the payment was otherwise due until it is
actually paid at the interest rate used to determine Actuarial Equivalences on the date such
payment is actually made; provided, however, that if the Participant dies prior to the
expiration of such six (6) month period, such deferred amount (and any interest thereon)
shall be paid to the Participant’s Beneficiary and any survivor benefits under the option
elected by the Participant shall be given effect (or, if a lump sum had been elected, the
lump sum shall be paid to his Beneficiary). 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 is 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.

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     5.06 Initial Payment Elections.

     (a) At any time within 30 days after an Employee is first designated as a Participant,
the Participant may affirmatively elect (a “Payment Election”): (i) the form in which the
Participant’s retirement benefit shall be paid, and (ii) the date or dates and/or event or
events for the payment (in the case of a retirement benefit payable in a lump sum) or the
commencement of the payment (in the case of a retirement benefit payable as an annuity) of
his retirement benefit under the Plan (each such date or dates and/or event or events for
payment or the commencement of the payment of a retirement benefit being referred to herein
as a “Payment Date”). Each Payment Date must be objectively determinable, and while an
Employee may amend or revise the Employee’s Payment Election at any time within the 30 day
period after an Employee is first designated as a Participant, such Payment Election in
effect on the close of business on such 30th day shall be irrevocable (except as
specifically provided herein). Each Payment Date 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”), or (B) the date of the Participant’s Separation
from Service (a “Separation from Service Payment”). A Participant may elect a Specified
Event Payment or a Separation from Service 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 or the Separation from Service Payment.

     (b) If a Participant has elected a Specified Event Payment and a Separation from
Service Payment in the alternative, the Participant may also elect alternative forms of
payment of his retirement benefit for the Specified Event Payment and the Separation from
Service Payment.

     (c) If a Participant has elected to receive (or as a result of failing to make a valid
election will be paid pursuant to Section 5.02) the Participant’s retirement benefit in an
annuity form, then the Participant may change the annuity form selected to any of the other
annuity forms permitted under the Plan and/or may change his Beneficiary at any time or from
time to time, and neither change shall be treated as an Amended Election subject to Section
5.07.

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

     (i) If the Participant has elected a Specified Event Payment, different forms
of payment may be elected depending upon whether the Payment Date occurs on or
before a specified time.

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     (ii) If the Participant has elected the Separation from Service Payment, a
different time and form of payment of the Participant’s retirement benefit 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).

     (iii) No Payment Date may be elected that will result in a payment or
commencement of a Participant’s retirement benefit prior to the later to occur of a
Participant’s Early Retirement Date or the Participant’s Separation from Service.
Any Payment Date elected which, if given effect, would require commencement of a
Participant’s retirement benefit prior to the Participant’s Early Retirement Date or
Separation from Service shall be treated as an election to be paid or commence the
Participant’s retirement benefit on the later to occur of a Participant’s Early
Retirement Date or Separation from Service.

     (e) Notwithstanding any other provision of this Section 5.07 to the contrary, each
Participant in this Plan as of December 31, 2007, may on or before December 31, 2007, make,
modify or revoke any election as to the time or form of payment of all or any of his
retirement benefit permitted to be made under this Plan, and all such elections in effect at
the close of business on December 31, 2007, shall be irrevocable, except as otherwise
provided herein.

     (f) Each Payment Election or change therein permitted by Section 5.06(c) shall be in
writing and filed with the Plan Administrator, and each Payment Election shall specify the
form of payment of the retirement benefit the Participant elects and the Payment Date for
the payment of such retirement benefit. Any Payment Election, once made, shall be
irrevocable, except as provided in Sections 5.06(c) and 5.07.

     5.07 Amended Payment Election.

     (a) A Participant may make another election (an “Amended Payment Election”) to defer,
but not to accelerate, the retirement benefit payable on the Payment Date elected in
accordance with Section 5.06 hereof (or in the absence of a valid Payment Election, pursuant
to Sections 5.03 and 5.05). Each Amended Payment Election shall be made in accordance with
this Section 5.07 and shall cause the payments of the Participant’s retirement benefit 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) A Participant’s Amended Payment Election to be valid must satisfy the following
limitations:

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     (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 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 Payment Election.

     5.08 Special 409A Provisions.

     (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) 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

     (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).

     5.09 Termination of Benefit. If the period of any retirement benefit is measured by
the life of an individual, the last payment to such individual shall be the last payment due on, or

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immediately prior to, the date of the individual’s death. No benefit shall be payable under the
Plan with respect to any Participant after such Participant’s death unless specifically provided
for in the Plan.

     5.10 Withholding. Alleghany shall have the right to deduct from all payments made
hereunder any federal, state, local or foreign income or employment taxes required, in the sole
judgment of Alleghany, to be withheld with respect to such payments. Notwithstanding any provision
of this Plan to the contrary, each Participant, as a condition to the entitlement to any retirement
benefits accruing under this Plan shall pay, or have made arrangements satisfactory to Alleghany
for the payment of, any employment taxes on retirement benefits accruing under this Plan.

     5.11 Automatic Payments. Notwithstanding any Participant’s election pursuant to this
Plan as to the time or form of his benefits, the following shall apply:

     (a) If any monthly payment that would otherwise be made to any person under the Plan is
less than $1,000, then, if the Plan Administrator shall so direct, the aggregate of the
amounts which shall be paid to such person in any year shall be paid in quarterly,
semiannual or annual installments; and

     (b) If the Actuarial Equivalent value of the Participant’s nonforfeitable retirement
benefit as of the date of his Separation from Service or the retirement benefit payable to
the Participant’s Surviving Spouse as of the date of the Participant’s death, in either
case, does not exceed the applicable dollar amount under Section 402(g)(1)(B) of the Code if
paid as a lump sum, then an amount equal to such Actuarial Equivalent value of such
retirement benefit shall be paid to the Participant or the Participant’s Spouse in a lump
sum in lieu of any retirement benefit to which he or she may be entitled to under this Plan.

ARTICLE VI.

PLAN ADMINISTRATION

     6.01 Plan Administrator Records. The Plan Administrator shall keep or cause to be
kept all data, records and documents relating to the administration of the Plan.

     6.02 Employment of Experts. The Plan Administrator may employ or engage such
independent actuaries, accountants, counsel, and other experts or persons as the Plan Administrator
may deem necessary in connection with discharging its duties under the Plan.

     6.03 Payment of Expenses. All expenses incurred in connection with the administration
of the Plan, including, but not limited to, the compensation of any actuary, accountant, counsel,
and other experts or persons who shall be employed by the Plan Administrator in connection with the
administration of the Plan shall be paid by Alleghany.

     6.04 Indemnification of Plan Administrator. Alleghany shall indemnify and hold

 - 12 - 

 

harmless to the fullest extent permitted by law the Plan Administrator and any Employee of
Alleghany to whom Plan responsibilities are delegated by the Plan Administrator from and against
any liabilities, damages, costs and expenses (including attorneys’ fees and amounts paid in
settlement of any claims approved by Alleghany) incurred by or asserted against the Plan
Administrator or such Employee by reason of the occupying or having occupied positions in
connection with the Plan, except that no indemnification shall be provided if the Plan
Administrator or such Employee personally profited from any act or transaction in respect of which
indemnification is sought.

     6.05 Binding Action. To the fullest extent permitted by law, all actions taken and
decisions made by the Plan Administrator shall be final, conclusive and binding on all persons
having any interest in the Plan or in any benefits payable thereunder.

ARTICLE VII.

POWERS AND DUTIES OF PLAN ADMINISTRATOR

     7.01 Administration Powers. The Plan Administrator shall have the power to take all
action and to make all decisions necessary or proper in order to carry out its duties and
responsibilities under the provisions of the Plan, including without limitation, the following:

     (a) To make and enforce such rules and regulations as the Plan Administrator shall deem
necessary or proper for the efficient administration of the Plan;

     (b) To interpret the Plan and its rules and regulations; and

     (c) To delegate to one or more persons the authority to administer the Plan, with such
duties, powers and authority relative to the administration of the Plan as the Plan
Administrator shall determine, and in so doing to limit its own duties and responsibilities
to the extent specified in such appointment.

     The Plan Administrator shall report to the Committee each year concerning the administration
and operation of the Plan.

     7.02 Plan Administrator Claims Review Authority and Procedures. Any claim for
benefits or other payments under the Plan shall be determined in accordance with the procedure set
forth below. A claim for benefits or other payments may be filed by a Participant, the surviving
Spouse of a Participant, a Beneficiary of a Participant or the authorized representative of such
Participant, Surviving Spouse or Beneficiary (the “claimant”).

     (a) Initial Claim Determination. Any claim for benefits or other payments
under the Plan shall be made by filing a written statement of such claim with the person or
persons designated by the Plan Administrator to process and make initial determinations as
to such claims. In the event such claim is denied in whole or in part, such person or
persons shall notify the claimant of the denial within 90 days after the date on which the
claim was filed. However, if the Plan Administrator determines that special

 - 13 - 

 

circumstances require an extension of time for deciding the claim, the Plan
Administrator shall furnish written notice of the extension to the claimant prior to the
expiration of such 90 day period. This notice shall indicate the special circumstances
requiring the extension, and the date by which the Plan expects to render the determination
on the claim. If an extension is taken, and if the claim is denied in whole or in part, the
person or persons who processed and denied the claim shall notify the claimant of the denial
within 180 days after the date on which the claim was filed.

     (b) Initial Notification of Claim Denial. Any notification of a whole or
partial denial of a claim shall be in writing. Such notification shall set forth, in a
manner calculated to be understood by the claimant:

     (i) the specific reason or reasons for the denial;

     (ii) reference to the specific provisions of the Plan on which the denial was
based;

     (iii) a description of any additional material or information necessary for the
claimant to perfect the claim, and an explanation of why such material or
information is necessary; and

     (vi) an explanation of the review procedure under subsection (c), including a
description of the time limits applicable to such procedure and a statement of the
claimant’s right to bring a civil action under Section 502(a) of ERISA following an
adverse determination of the claim on review.

     (c) Review Procedure. A claimant whose claim is denied in whole or in part
under subsection (a) shall be entitled to have such denial reviewed by the Plan
Administrator, by filing a written request for such review with the Plan Administrator
within 60 days after its receipt of the notification of the claim denial under subsection
(b). The claimant may request and shall be provided, free of charge, reasonable access to,
and copies of, all documents, records and other information which is relevant to the claim,
and which is in the possession of the Plan Administrator or Alleghany. The claimant may
provide comments, documents, records and other information relating to the claim to the
Plan Administrator to consider when reviewing the claim. Upon receipt of a request for a
review of a denied claim, the Plan Administrator shall make a full and fair review of the
claim. Such review shall take into account all comments, documents, records and other
information submitted by the claimant relating to the claim, without regard to whether the
same was submitted or considered in the initial claim determination.

     (d) Decision on Review. The Plan Administrator shall make a decision with
respect to such claim, and shall notify the claimant of its decision, within 60 days after
its receipt of the claimant’s written request for review. However, if the Plan
Administrator determines that special circumstances, such as the need to hold a hearing,
require an extension of time for deciding the claim, the Plan Administrator shall provide a
written

 - 14 - 

 

notice of the extension to the claimant prior to the expiration of such 60 day period.
This notice shall indicate the special circumstances requiring the extension, and the date
by which the Plan expects to render the determination on review. If an extension is taken,
the Plan Administrator shall notify the claimant of its decision on the claim within 120
days after the date on which the request to review the denial of the claim was filed.
However, if the Plan Administrator determines that an extension is needed because the
claimant must submit additional information in order for the Plan Administrator to make its
determination on the claim, and the Plan Administrator requests such additional information
from the claimant in the notification of extension, then the 120 day period for making the
determination on review shall be tolled for the period which starts on the date on which
such notification is sent to the claimant, and which ends on the date on which the claimant
provides such additional information to the Plan Administrator.

     (e) Notification of Decision on Review. The notification of the Plan
Administrator’s decision on review shall be in writing. If the claim is denied, the
notification shall set forth, in a manner calculated to be understood by the claimant:

     (i) the specific reason or reasons for the claim denial;

     (ii) reference to the specific Plan provisions on which the claim denial was
based;

     (iii) a statement that the claimant is entitled to receive, upon request and
free of charge, reasonable access to, and copies of, all documents, records and
other information which is relevant to the claim, and which is in the possession of
the Plan Administrator or Alleghany; and

     (iv) a statement of the claimant’s right to bring an action with respect to the
matter raised in the claim under Section 502(a) of ERISA.

     The Plan Administrator shall provide the claimant with reasonable access to, and copies of,
any documents, records and other information which the claimant is entitled to receive, as
indicated in the notification.

     7.03 Conflicts of Interest. The Plan Administrator shall not participate in the
resolution of any question which relates directly or indirectly to him and which, if applied to
him, would significantly vary his eligibility for, or the amount of, any benefit payable to him.
In cases involving the disqualification under this Section 7.03 of the Plan Administrator, the
questions at issue shall be certified to the Compensation Committee of the Board for resolution.

ARTICLE VIII.

LIMITATION OF RIGHTS AND OBLIGATIONS

     8.01 Plan is Voluntary. Although it is the intention of Alleghany that the Plan shall
be continued, the Plan is entirely voluntary on the part of Alleghany and the Plan’s continuance is

 - 15 - 

 

not a contractual obligation of Alleghany. Notwithstanding any termination of the Plan by
Alleghany, Alleghany agrees as a contractual obligation with the Participants to pay all amounts as
shall be necessary to provide the retirement benefits accrued by them under the Plan as of the date
of any such termination of the Plan.

     8.02 Creation of Certain Employment Rights. The Plan shall be deemed to constitute a
contract between Alleghany and each Participant and is consideration or inducement for the
employment of the Participant by Alleghany. Notwithstanding the foregoing, nothing contained in
the Plan shall be deemed (a) to give any person the right to be retained in the service of
Alleghany or to be continued as an officer of Alleghany or (b) 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.

     8.03 Distributions Only from Alleghany. Each Participant and any other person who
shall claim any retirement benefit or other rights under the Plan shall be entitled to look only to
Alleghany for any payment or benefit, and no member of the Board, officer or employee of Alleghany
shall be liable in any manner if Alleghany shall fail to meet its obligations hereunder. Each
Participant shall be only an unsecured general creditor of Alleghany with respect to the retirement
benefits to which he is entitled under this Plan.

ARTICLE IX.

AMENDMENT AND TERMINATION

     9.01 Amendment. The Plan may be amended, whether prospectively or retroactively, in
whole or in part, at any time, or from time to time, whether upon termination or otherwise, as to
any or all of its provisions, by, or pursuant to authorization contained in, a resolution adopted
by the Board; provided, however, that no amendment may reduce the accrued benefit of any
Participant (calculated as if the Plan then terminated).

     9.02 Termination. The Board may at any time terminate the Plan, in whole or part.

     9.03 Payment of Benefits upon Termination. Upon termination of the Plan, benefits may
be paid directly by Alleghany or by means of insurance and/or annuity contracts purchased from one
or more insurance companies either (a) by payment of the benefits when and as called for under the
Plan until such time as all benefits are paid, or (b) by distribution of the Actuarial Equivalent
of the accrued retirement benefits of each Participant, in cash in one lump sum or (c) by the
purchase of annuity contracts of such type as the Board shall determine; provided, however, that no
payment shall be made in a form or at a time which shall violate Section 409A of the Code. For
this and all other purposes of the Plan, the accrued benefit of any Participant shall equal the
retirement benefit (or the lump sum Actuarial Equivalent thereof) the Participant would have been
entitled to receive at the time of reference if his Termination of Employment were the date of the
Plan termination or the time of reference, as the case may be, and the Participant’s retirement
benefits were payable as of the date, and in the form, then elected by the Participant pursuant to
Section 5.07 or as otherwise provided in the Plan.

 - 16 - 

 

ARTICLE X.

LIMITATION ON ASSIGNMENT

     10.01 Spendthrift Provision. In order that the benefits hereunder shall be fully
protected against claims of all sorts, direct or otherwise, none of the benefits provided hereunder
to any person shall be assignable or transferable voluntarily, nor shall they be subject to the
claims of any beneficiary or creditor whatsoever, nor subject to attachment, garnishment or other
legal process by any creditor or to the jurisdiction of any bankruptcy court or any insolvency
proceedings by operation of law, or otherwise. No person shall have any right to alienate,
anticipate, pledge, sell, transfer, assign, commute, or encumber any of such benefits voluntarily
or involuntarily.

     10.02 Incompetence of Participant or Beneficiary. If the Plan Administrator receives
evidence satisfactory to him that a person entitled to receive any payment under the Plan is
legally incompetent to receive such payment and to give valid release therefor, such payment may be
made to the guardian, committee, or other representative of such person duly appointed by a court
of competent jurisdiction. If a person or institution other than a guardian, committee, or other
representative of such person who has been duly appointed by a court of competent jurisdiction is
then maintaining or has custody of such incompetent person, the payment may be made to such other
person or institution and the release of such other person or institution shall be valid and
complete discharge for the payment.

ARTICLE XI.

MISCELLANEOUS

     11.01 Governing Laws. This Plan and all provisions thereof shall be construed and
administered according to the laws of the State of New York without giving effect to the principle
of conflicts of law thereof.

     11.02 Name. The name of this Plan is the “Alleghany Corporation Retirement Plan.”

     11.03 Titles and Heading not to Control. The titles to the Articles and the headings
of Sections in the Plan are placed herein for convenience of reference only, and in case of any
conflict, the text of this instrument, rather that such titles or headings, shall control.

     11.04 Gender and Person. The masculine pronoun shall include the feminine, the
feminine pronoun shall include the masculine and the singular shall include the plural wherever the
context so requires.

     11.05 Preservation of Pre-Amendment Accrued Benefits. Notwithstanding any provision
of the Plan to the contrary, each Participant who was employed by Alleghany on December 31, 2006,
shall always be entitled to receive no less than the amount of the retirement benefits (and any
related tax distributions) which such Participant had accrued as of December 31, 2006, payable in
such amounts, subject to such adjustments and utilizing such factors and methods pursuant to the
terms and provisions of the Plan as in effect prior to its amendment

 - 17 - 

 

effective as of December 31, 2006; provided that the foregoing shall not entitle any Participant to
payment of his retirement benefits prior to the time provided in this Plan as in effect at the time
such retirement benefits commence. The amount of the retirement benefits (and any tax
distributions) that a Participant may be entitled to receive pursuant to the provisions of this
Section 11.05 are in lieu of, and not in addition to, the retirement benefits and entitlements to
which such Participant is then entitled to under this Plan as so amended effective as of December
31, 2006.

     11.06 Alleghany Capital Partners LLC. The Board may designate officers of Alleghany
Capital Partners LLC (“ACP”) to participate in the Plan and accrue retirement benefits hereunder as
if each such designated officer were an officer of Alleghany (each an “ACP Participant”). During
the period such ACP Participant is an officer of ACP, such ACP Participant shall be treated as
employed by, and an officer of, Alleghany for purposes of applying the provisions of the Plan
relating to participation, vesting and the entitlement to, and amount of, retirement benefit.

 - 18 - 

 

ALLEGHANY CORPORATION RETIREMENT PLAN

EXHIBIT I

Pre-Effective Date Years of Service

	 	 	 	 	 
	 	 	Years of
	Name	 	Service at 12/31/88
	Sismondo, Peter
	 	 	1.0	 

EXHIBIT II

Special Grants of Additional Years of Service

	 	 	 	 	 
	Name	 	Additional Years of Service
	Hart, Robert M.
	 	 	5	 

 - 19 - 

 

EXHIBIT III

Robert Hart

	 	 	 	 	 
	 	 	Accumulation of	 
	Retirement	 	Secular Lump Sum	 
	Age	 	Payment	 
	60
	 	 	5,718,868	 
	61
	 	 	5,921,889	 
	62
	 	 	6,132,116	 
	63
	 	 	6,349,806	 
	64
	 	 	6,575,224	 
	65
	 	 	6,808,644	 
	66
	 	 	7,050,350	 
	67
	 	 	7,300,638	 
	68
	 	 	7,559,810	 
	69
	 	 	7,828,183	 
	70
	 	 	8,106,084	 
	71
	 	 	8,393,850	 
	72
	 	 	8,691,832	 
	73
	 	 	9,000,393	 
	74
	 	 	9,319,906	 
	75
	 	 	9,650,763	 

 - 20 - 

 

EXHIBIT III (con’t)

Peter Sismondo

	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 	 
	 	 	Accumulation of	 	Ongoing Single	 	Ongoing Single	 	Accumulation of
	Retirement	 	Secular Annuity	 	Life Secular	 	Life Tax-Qualified	 	Tax-Qualified
	Age	 	Payments	 	Annuity Payments	 	Annuity Payments	 	Annuity Payments
	     55
	 	 	0	 	 	 	140,252	 	 	 	1,473.44	 	 	 	0	 
	56
	 	 	143,397	 	 	 	140,252	 	 	 	1,536.59	 	 	 	0	 
	57
	 	 	292,731	 	 	 	140,252	 	 	 	1,599.74	 	 	 	0	 
	58
	 	 	448,248	 	 	 	140,252	 	 	 	1,662.89	 	 	 	0	 
	59
	 	 	610,203	 	 	 	140,252	 	 	 	1,726.03	 	 	 	0	 
	60
	 	 	778,862	 	 	 	140,252	 	 	 	1,789.18	 	 	 	0	 
	61
	 	 	954,505	 	 	 	140,252	 	 	 	1,852.33	 	 	 	0	 
	62
	 	 	1,137,418	 	 	 	140,252	 	 	 	1,915.48	 	 	 	0	 
	63
	 	 	1,327,905	 	 	 	140,252	 	 	 	1,978.62	 	 	 	0	 
	64
	 	 	1,526,278	 	 	 	140,252	 	 	 	2,041.77	 	 	 	0	 
	65
	 	 	1,732,863	 	 	 	140,252	 	 	 	2,104.92	 	 	 	0	 
	66
	 	 	1,948,001	 	 	 	140,252	 	 	 	2,104.92	 	 	 	2,152	 
	67
	 	 	2,172,045	 	 	 	140,252	 	 	 	2,104.92	 	 	 	4,393	 
	68
	 	 	2,405,365	 	 	 	140,252	 	 	 	2,104.92	 	 	 	6,727	 
	69
	 	 	2,648,345	 	 	 	140,252	 	 	 	2,104.92	 	 	 	9,158	 
	70
	 	 	2,901,384	 	 	 	140,252	 	 	 	2,104.92	 	 	 	11,689	 
	71
	 	 	3,164,898	 	 	 	140,252	 	 	 	2,104.92	 	 	 	14,325	 
	72
	 	 	3,439,322	 	 	 	140,252	 	 	 	2,104.92	 	 	 	17,070	 
	73
	 	 	3,725,108	 	 	 	140,252	 	 	 	2,104.92	 	 	 	19,929	 
	74
	 	 	4,022,724	 	 	 	140,252	 	 	 	2,104.92	 	 	 	22,907	 
	75
	 	 	4,332,663	 	 	 	140,252	 	 	 	2,104.92	 	 	 	26,007	 

Note: In applying the reduction in Section 4.02, the amounts shown above in this Exhibit III: (i)
as “Accumulations of Secular Annuity Payments” and “Accumulation of Tax-Qualified Annuity Payments”
are converted from a lump sum to the form provided in Article IV on an Actuarial Equivalent basis,
and (ii) as “Annuity Payments” are converted from an annual amount payable monthly of the annuity
form so specified to the form provided in Article IV on an Actuarial Equivalent basis. In each
case, such Actuarial Equivalent basis shall be determined as of the date the Participant’s
retirement benefits commence, and if the date the Participant’s retirement benefits commence is
other than the first day of the month coinciding with or next following the retirement age
indicated, the amount utilized will be based upon the amounts shown above interpolated for
completed months between the retirement ages indicated and the date such retirement benefits
commence.

 - 21 -EX-10.2

 

 Exhibit 10.2

ALLEGHANY CORPORATION OFFICERS AND HIGHLY

COMPENSATED EMPLOYEES

DEFERRED COMPENSATION PLAN

     The Alleghany Corporation Officers and Highly Compensated Employees Deferred Compensation Plan
(the “Plan”), as amended and restated as of January 1, 2008, 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) “Code” shall mean the Internal Revenue Code of 1986, as amended, and the Treasury
Regulations thereunder.

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

     (g) “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.”

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

     (i) “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

- 2 -

 

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.

     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

- 3 -

 

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.

     (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

- 4 -

 

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:

	 	(1)	 	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.
	 
	 	(2)	 	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 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.
	 
	 	(3)	 	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.
	 
	 	(4)	 	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).
	 
	 	(5)	 	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.

- 5 -

 

     (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, 2007, 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, 2007, excluding any amount credited under the Plan that in the absence of such election would
otherwise be paid in 2007.

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 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:

	 	(1)	 	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.
	 
	 	(2)	 	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.
	 
	 	(3)	 	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.

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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.

     (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 to have all or a portion of the amounts credited to an
Account be invested in Common Stock (a “Common Stock 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 treated as invested in Common Stock, 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” 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.

- 7 -

 

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) 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 the Prime Rate or
changes in the value of, and the distributions on, Common Stock, 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.

- 8 -

 

10. TIME OF PAYMENT IN CERTAIN CIRCUMSTANCES.

     (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 and is not entitled to
Pre-409A Amounts in the calendar year the Participant has a Separation from Service that would
permit the Participant to receive the Participant’s entire balance under the Plan (including the
Pre-409A Amounts 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. 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:

	 	(1)	 	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);

- 9 -

 

	 	(2)	 	as may be necessary to comply with applicable federal, state,
local or foreign ethics or conflicts of interest law; or
	 
	 	(3)	 	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

- 10 -

 

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.

     (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 (1) 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.

- 11 -

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