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8-K - FORM 8-K - ALLEGHANY CORP /DE | y88590e8vk.htm |
Exhibit 10.1
AS ADOPTED
ALLEGHANY CORPORATION RETIREMENT PLAN
(As Amended and Restated Effective January 1, 2011)
This document sets forth the Alleghany Corporation Retirement Plan, as amended and restated
(and further revised) effective as of January 1, 2011. The retirement benefit of any Participant
who has a Separation from Service on or after January 1, 2011 shall be determined under the terms
of this Plan as so amended and restated.
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 persons 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 persons benefit commences.
ARTICLE I.
DEFINITIONS
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 Participants 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 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 annual base salary (or the annual rate of base
salary if employed for less than a full calendar year) earned by an Employee for the calendar year
(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 or annual incentive compensation or
bonuses, 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 Participants 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 Participants 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
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designating such engagement or services as that of a consultant, independent contractor or
other words of similar meaning shall be deemed an Employee.
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. Frozen Accrued Benefit shall mean the annual retirement benefit accrued by a
Participant as of December 31, 2010 (or earlier as provided herein) under Section 4.01 of this Plan
as in effect on December 31, 2010.
1.15. 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.
1.16. 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.
1.17. 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).
1.18. Plan means the plan set forth herein as modified or amended from time to time.
1.19. 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.
1.20. Plan Year means a calendar year.
1.21. Separation from Service shall mean the Participants 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 Participants
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).
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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 Participants 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 Participants 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
PARTICIPATION
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 Compensation during his
subsequent period of employment shall be disregarded in calculating his benefits under this Plan.
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ARTICLE III.
VESTING AND BENEFIT ENTITLEMENT
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
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 Participants Normal Retirement
Date, is payable to the Participant for his life, and after the Participants death continues to
the Participants Spouse, if any, for her life in the same monthly amount as was being received by
the Participant, shall equal the greater of (x) the product of (i) 66.67% of the Participants
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 Spouses
benefit on account of the number of years and months, if any, by which the Spouse is younger than
the Participant or (y) the Participants Frozen Accrued Benefit.
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 Participants annual
retirement benefit otherwise payable under this Article IV in all cases shall be offset by the
Actuarial Equivalent of amounts shown in Exhibit III.
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, except that (x) the benefit described in clause (x) of Section 4.01 shall be based on
the Participants Years of Service and Average Compensation calculated as of his Normal
Retirement Date, and (y) if the Participants Normal Retirement Date occurred before
December 31, 2010, the benefit in clause (y) of Section 4.01 shall be based upon the Frozen
Accrued Benefit which the Participant accrued at his Normal Retirement Date (rather than at
December 31, 2010) under the terms of this Plan as in effect on December 31, 2010, in either
case reduced (if applicable) as set forth in Section 4.02, which benefit shall then be (i)
increased from the Participants Normal Retirement
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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 Participants
Normal Retirement Date to the Actuarial Equivalent lump sum factor as in effect on the
Participants Late Retirement Date; or
(b) the annual retirement benefit determined in accordance with the formula in Section
4.01, (which in the case of the benefit described in clause (x) of Section 4.01 shall be
based on all the Participants Years of Service and Average Compensation calculated as of
his Late Retirement Date) reduced (if applicable) as set forth in Section 4.02.
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
FORMS OF RETIREMENT BENEFITS
5.01. Calculation of Amount of Benefit Payments. The actual amount of a Participants
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 Participants
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 Participants 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,
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with such monthly annuity continued to the Participants 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 Participants Spouse unless she was lawfully married to the Participant on his
Annuity Starting Date (or, in the case of a Participants 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 Participants 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 Participants 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 Participants 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 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.
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(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 Participants 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
Participants 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 Participants retirement benefit under the Plan is based upon or attributable
to the Participants Separation from Service and the Participant is at the time of the
Participants Separation from Service a Specified Employee, then (i) payment of the
Participants 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 Participants 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 Participants 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.
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
Participants 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
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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 Employees 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
Participants 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 Participants 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, in either case, prior to the commencement of his retirement benefit, 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.
(ii) If the Participant has elected the Separation from Service Payment, a
different time and form of payment of the Participants 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
Participants 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).
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(iii) No Payment Date may be elected that will result in a payment or
commencement of a Participants retirement benefit prior to the later to occur of a
Participants Early Retirement Date or the Participants Separation from Service.
Any Payment Date elected which, if given effect, would require commencement of a
Participants retirement benefit prior to the Participants Early Retirement Date or
Separation from Service shall be treated as an election to be paid or commence the
Participants retirement benefit on the later to occur of a Participants 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, 2008, may on or before December 31, 2008, 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, 2008, 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 Participants 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 Participants 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 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
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Election, would have been paid within twelve (12) months from the date of the
Amended Payment Election.
(c) Except as set forth herein, a Participants 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
immediately prior to, the date of the individuals death. No benefit shall be payable under the
Plan with respect to any Participant after such Participants 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
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Alleghany for the payment of, any employment taxes on retirement benefits accruing under this
Plan.
5.11. Automatic Payments. Notwithstanding any Participants 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 Participants nonforfeitable retirement
benefit as of the date of his Separation from Service or the retirement benefit payable to
the Participants Surviving Spouse as of the date of the Participants 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 Participants 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
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
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.
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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
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 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.
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(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
(iv) 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
claimants 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 claimants 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 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
- 14 -
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 Administrators
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 claimants 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
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 Plans
continuance is 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
- 15 -
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
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 Participants 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.
ARTICLE X.
LIMITATION ON ASSIGNMENT
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
- 16 -
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
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. 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.
- 17 -
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 |
- 18 -
EXHIBIT III
Robert Hart
Accumulation of | ||||
Retirement | Secular Lump Sum | |||
Age | Payment | |||
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 |
- 19 -
EXHIBIT III (cont)
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 |
- 20 -
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 | ||||||||||||
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 Participants
retirement benefits commence, and if the date the Participants 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.
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