SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 or 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported): December 21, 2004
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ALLEGHANY CORPORATION
(Exact name of registrant as specified in its charter)
Delaware 1-9371 51-0283071
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(State or other jurisdiction (Commission File Number) (IRS Employer
of incorporation) Identification No.)
375 Park Avenue, Suite 3201
New York, New York 10152
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code (212) 752-1356
Item 1.01 Entry into a Material Definitive Agreement.
1. On December 21, 2004, pursuant to the terms of the employment agreement
between Alleghany Corporation (the "Company") and Weston Hicks dated
October 7, 2002, and as a result of Mr. Hicks being elected chief executive
officer of the Company effective December 31, 2004, Mr. Hicks was granted a
restricted stock award of 26,010 shares of Common Stock (as adjusted for
stock dividends paid since the date of the employment agreement) under the
Company's 2002 Long-Term Incentive Plan (the "Plan"), which will vest upon
the Company's achievement of specified levels of average annual compound
growth in stockholders' equity per share as measured over the period
commencing January 1, 2005 and ending on December 31, 2008, 2009, 2010 or
2011, or as measured over the period commencing January 1, 2005 and ending
on December 31, 2012, 2013 or 2014. If the performance goals are not
achieved as of December 31, 2014, Mr. Hicks will forfeit all of the
restricted shares. If Mr. Hicks's employment with the Company is
terminated for any reason prior to the occurrence of any vesting date, he
shall forfeit his interest in any restricted shares that have not yet
vested; however, if the Company terminates Mr. Hicks's employment after
December 31, 2006 other than for cause or total disability, and the second
performance goal set forth above has been satisfied in all respects except
for the passage of the required period of time, that number of restricted
shares equal to 26,010 multiplied by a fraction, the numerator of which is
the number of full calendar years beginning January 1, 2005 and ending on
or before the date of such termination, and the denominator of which is
ten, will vest.
2. Consistent with the practice of granting performance shares on an
annual basis, on December 21, 2004 the Compensation Committee of the Board
of Directors of the Company awarded to the executive officers of the Company
performance shares under the Plan. Each such performance share entitles
the recipient thereof to a payout of cash and/or Common Stock (in such
proportion as determined by the Compensation Committee) up to a maximum
amount equal to the fair market value on the date of payout of one and
one-half shares of Common Stock. The amount of any payout of such
performance shares is measured by average annual compound growth in the
Company's Book Value Per Share over the 2005-2008 award period; Book Value
Per Share is the fully diluted stockholders' equity per share of the
Company's Common Stock determined in accordance with generally accepted
accounting principles, less all costs resulting from awards under the Plan
and the Company's 1993 Long-Term Incentive Plan. Pursuant to the terms of
the performance shares, in the event of certain transactions involving the
Company, various aspects of the performances shares awarded to each
executive officer may be equitably adjusted so that performance shares
payable following the transaction shall equal, as nearly as possible, the
performance shares which would have been payable in the absence of such
transaction. Except as the Compensation Committee may otherwise determine,
payouts in full are conditional upon a recipient's remaining in the employ
of the Company throughout the award period.
Signature
Pursuant to the requirements of the Securities Exchange Act of 1934, the
registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
ALLEGHANY CORPORATION
/s/ Peter R. Sismondo
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By: Peter R. Sismondo
Vice President,
Controller,
Treasurer and Assistant
Secretary
Date: December 28, 2004