Allstate 2015 Annual Report Download - page 64

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EXECUTIVE COMPENSATION
Termination Scenarios
Compensation
Elements Termination(1) Retirement Termination due to
Change-in-Control(2) Death Disability
Performance
Stock Awards(4)(6)
Forfeited Awards granted
more than 12
months before, and
pro rata portion
of awards granted
within 12 months of
retirement, continue
to vest and are paid
out based on actual
performance(7)
Awards vest based
on performance
upon a qualifying
termination after
a CIC(8)
Awards
vest and
are payable
immediately(9)
Awards
vest and
are payable
immediately(9)
Non-Qualified
Pension
Benefits(10)
Distributions
commence
per plan
Distributions
commence per plan
Immediately payable
upon a CIC
Distributions
commence
per plan
Participant
may request
payment if
age 50 or older
Deferred
Compensation(11)
Distributions
commence
per
participant
election
Distributions
commence per
participant election
Immediately payable
upon a CIC
Payable within
90 days
Distributions
commence
per participant
election
Health, Welfare
and Other
Benefits
None None Outplacement
services provided;
lump sum
payment equal to
additional cost of
welfare benefits
continuation
coverage for
18 months(12)
None Supplemental
Long Term
Disability
benefits if
enrolled in
basic long
term disability
plan
(1) Includes both voluntary and involuntary termination. Examples of involuntary termination independent of
a change in control include performance-related terminations; terminations for employee dishonesty and
violation of Allstate rules, regulations, or policies; and terminations resulting from lack of work, rearrangement
of work, or reduction in force.
(2) In general, a change in control is one or more of the following events: (1) any person acquires 30% or more
of the combined voting power of Allstate common stock within a 12-month period; (2) any person acquires
more than 50% of the combined voting power of Allstate common stock; (3) certain changes are made to the
composition of the Board; or (4) the consummation of a merger, reorganization, or similar transaction. These
triggers were selected because any of these could cause a substantial change in management in a widely
held company the size of Allstate. Effective upon a change in control, the named executives become subject
to covenants prohibiting solicitation of employees, customers, and suppliers until one year after termination
of employment. If a named executive incurs legal fees or other expenses in an effort to enforce the change-in-
control plan, Allstate will reimburse the named executive for these expenses unless it is established by a court
that the named executive had no reasonable basis for the claim or acted in bad faith.
(3) Under the change-in-control plan, severance benefits would be payable if a named executive’s employment
is terminated either by Allstate without cause or by the executive for good reason as defined in the plan
during the two years following the change in control. Cause means the named executive has been convicted
of a felony or other crime involving fraud or dishonesty, has willfully or intentionally breached the restrictive
covenants in the change-in-control plan, has habitually neglected his or her duties, or has engaged in willful
or reckless material misconduct in the performance of his or her duties. Good reason includes a material
diminution in a named executive’s base compensation, authority, duties, or responsibilities, or a material
change in the geographic location where the named executive performs services.
(4) Named executives who receive an equity award or an annual cash incentive award after May 19, 2009,
are subject to a non-solicitation covenant while they are employed and for the one-year period following
termination of employment. If a named executive violates the non-solicitation covenant, the Board or a
committee of the Board, to the extent permitted by applicable law, may recover compensation provided to
the named executive, including cancellation of outstanding awards or recovery of all or a portion of any gain