Allstate 2011 Annual Report Download - page 31

with earnings thereon, may be transferred between accounts and are distributed after the director leaves the
Board in a lump sum or over a period not to exceed ten years.
In September 2010, the Board approved an increase in director cash retainers. Beginning June 1, 2011, each
non-employee director will be entitled to a quarterly cash retainer of $22,500, and each non-employee director
who serves as a chair of a Board committee, other than the Audit Committee, shall be entitled to receive an
additional quarterly chair fee for each such chair in the amount of $5,000, and the non-employee director who
serves as a chair of the Audit Committee shall be entitled to receive an additional quarterly chair fee in the
amount of $6,250.
Restricted stock unit awards granted on or after September 15, 2008, provide for delivery of the underlying
shares of Allstate common stock upon the earlier of (a) the date of the director’s death or disability or (b) the
date the director leaves the Board. Restricted stock unit awards granted before September 15, 2008, provide for
delivery of the underlying shares of Allstate common stock upon the earlier of (a) the date of the director’s death
or disability or (b) one year after the date the director leaves the Board. Each restricted stock unit includes a
dividend equivalent right that entitles the director to receive a payment equal to regular cash dividends paid on
Allstate common stock. Under the terms of the restricted stock unit awards, directors have only the rights of
general unsecured creditors of Allstate and no rights as stockholders until delivery of the underlying shares.
In accordance with the terms of the 2006 Equity Compensation Plan for Non-Employee Directors, the exercise
price of the stock option awards is equal to the fair market value of Allstate common stock on the date of grant.
For options granted in 2007 through 2008, the fair market value is equal to the closing sale price on the date of
the grant, and for options granted prior to 2007, fair market value is equal to the average of high and low sale
prices on the date of grant, and, in each case, if there was no such sale on the date of grant, then on the last
previous day on which there was a sale. The options become exercisable in three substantially equal annual
installments and expire ten years after grant. The unvested portions of a director’s outstanding options fully vest
upon his or her mandatory retirement pursuant to Board policies. Stock option repricing is not permitted. An
outstanding stock option will not be amended to reduce the option exercise price. However, the plan permits
repricing in an event such as equity restructuring (such as a split) or a change in corporate capitalization (such
as a merger).
As detailed in our Corporate Governance Guidelines, the corporation maintains stock ownership guidelines for
our non-employee directors. Within five years of joining the Board, each director is expected to accumulate an
ownership position in Allstate securities equal to five times the value of the annual cash retainer paid for board
service. Except for Ms. Redmond, every director has met the ownership guideline. Ms. Redmond joined the Board
on January 1, 2010, and has until January 1, 2015, to meet the guideline.
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Proxy Statement