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Proc-Type: 2001,MIC-CLEAR
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<SEC-DOCUMENT>0000950137-05-001730.txt : 20050214
<SEC-HEADER>0000950137-05-001730.hdr.sgml : 20050214
<ACCEPTANCE-DATETIME>20050214170924
ACCESSION NUMBER:		0000950137-05-001730
CONFORMED SUBMISSION TYPE:	8-K
PUBLIC DOCUMENT COUNT:		3
CONFORMED PERIOD OF REPORT:	20050209
ITEM INFORMATION:		Entry into a Material Definitive Agreement
ITEM INFORMATION:		Financial Statements and Exhibits
FILED AS OF DATE:		20050214
DATE AS OF CHANGE:		20050214

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			CNA FINANCIAL CORP
		CENTRAL INDEX KEY:			0000021175
		STANDARD INDUSTRIAL CLASSIFICATION:	FIRE, MARINE & CASUALTY INSURANCE [6331]
		IRS NUMBER:				366169860
		STATE OF INCORPORATION:			DE
		FISCAL YEAR END:			1231

	FILING VALUES:
		FORM TYPE:		8-K
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	001-05823
		FILM NUMBER:		05612083

	BUSINESS ADDRESS:	
		STREET 1:		CNA PLZ
		STREET 2:		235
		CITY:			CHICAGO
		STATE:			IL
		ZIP:			60685
		BUSINESS PHONE:		3128225000

	MAIL ADDRESS:	
		STREET 1:		CNA PLAZA
		STREET 2:		235
		CITY:			CHICAGO
		STATE:			IL
		ZIP:			60685
</SEC-HEADER>
<DOCUMENT>
<TYPE>8-K
<SEQUENCE>1
<FILENAME>c92171e8vk.txt
<DESCRIPTION>CURRENT REPORT
<TEXT>
<PAGE>

                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

                                    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) FEBRUARY 9, 2005



                            CNA FINANCIAL CORPORATION
- --------------------------------------------------------------------------------
             (Exact name of registrant as specified in its charter)



          DELAWARE                     1-5823                    36-6169860
- --------------------------------------------------------------------------------
(State or other jurisdiction        (Commission                (IRS Employer
       of incorporation)            File Number)            Identification No.)




     CNA CENTER, CHICAGO, ILLINOIS                                60685
- ----------------------------------------                       ----------
(Address of principal executive offices)                       (Zip Code)



        Registrant's telephone number, including area code (312)822-5000



                                 NOT APPLICABLE
- --------------------------------------------------------------------------------
         (Former name or former address, if changed since last report.)

Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions (see General Instruction A.2. below):

[ ] Written communications pursuant to Rule 425 under the Securities Act
    (17 CFR 230.425)

[ ] Soliciting material pursuant to Rule 14a-12 under the Exchange Act
    (17 CFR 240.14a-12)

[ ] Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange
    Act (17 CFR 240.14d-2(b))

[ ] Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange
    Act (17 CFR 240.13e-4(c))



                                   Page 1 of 2


<PAGE>


ITEM 1.01 ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT.

On February 9, 2005 the Incentive Compensation Committee of Registrant's Board
of Directors approved the form of Award Letter and Award Terms for stock option
grants to the executive officers of Registrant, specifically Stephen W.
Lilienthal, Michael Fusco, Jonathan D. Kantor, James R. Lewis and D. Craig Mense
(collectively the "Executive Officers"). The form of Award Letter is filed as
Exhibit 99.1 and the form of Award Terms is filed as Exhibit 99.2 to this Form
8-K.

ITEM 1.01 ENTRY INTO A MATERIAL DEFINITIVE AGREEMENT.

On February 9, 2005 the Incentive Compensation Committee of Registrant's Board
of Directors approved the following items with regard to the Executive Officers:

              a.  Annual Incentive Bonus ("AIB") amounts for 2004, payable in
                  2005. The AIB is determined through a performance goal of
                  Registrant's net operating income or payout formula that is a
                  percentage of Registrant's net operating income achieved in a
                  particular year, in this instance 2004.

              b.  2004 performance year results for the Long-Term Incentive Cash
                  Plan (the "LTI Plan"). The LTI Plan potential bonus amounts
                  based upon Registrant's net operating income over three year
                  cycles, with goals set for each calendar year within the three
                  year cycle. Performance is determined at the end of each
                  calendar year and payouts are accrued until the end of each
                  three year cycle. The 2004 Performance Year Results that were
                  approved apply to the 2002-2004, 2003-2005 and 2004-2006
                  cycles under the LTI Plan. The next scheduled payout under the
                  LTI Plan is expected to be in March of 2005, following the end
                  of the 2002-2004 LTI Plan cycle.

              c.  AIB opportunities for the 2005 performance year, determined
                  through a performance goal of Registrant's net operating
                  income or payout formula that is a percentage of Registrant's
                  net operating income achieved in 2005, payable in 2006.

              d.  Net operating income goals for 2005 under the LTI Plan,
                  applicable to the 2003-2005, 2004-2006 and 2005-2007 LTI Plan
                  cycles.

              e.  Adjustments to the definition of net operating income for
                  purposes of determining performance and bonus payouts
                  applicable to AIB opportunities for 2005 and the 2005 LTI Plan
                  cash targets for the 2003-2005, 2004-2006 and 2005-2007 LTI
                  Plan cycles.

ITEM 9.01 FINANCIAL STATEMENTS AND EXHIBITS.

 (c) Exhibits:

Exhibit No.       Description
- -----------       ------------------------------------------------------------
99.1              Form of Award Letter for stock option grants to Executive
                  Officers approved by the Incentive Compensation Committee of
                  Registrant's Board of Directors on February 9, 2005.

99.2              Form of Award Terms for stock option grants to Executive
                  Officers approved by the Incentive Compensation Committee of
                  Registrant's Board of Directors on February 9, 2005.



                                   SIGNATURES

      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 hereunto duly authorized.

                                                  CNA FINANCIAL CORPORATION
                                                        (Registrant)

Date February 14, 2005                               /s/ D. Craig Mense
                                            ------------------------------------
                                                         (Signature)
                                            By:  D. Craig Mense
                                            Its:  Executive Vice President and
                                                  Chief Financial Officer




                                   Page 2 of 2

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.1
<SEQUENCE>2
<FILENAME>c92171exv99w1.txt
<DESCRIPTION>FORM OF AWARD LETTER
<TEXT>
<PAGE>
                                                                    EXHIBIT 99.1





CNA Plaza  Chicago  IL  60685-0001


[Date]

Private and Confidential

To:  [[Current_First_Name]][[Current_Last_Name]]


Re:   Grant of Stock Option Award


The Incentive Compensation Committee (the "Committee") of the Board of Directors
of CNA Financial Corporation ("Company"), which administers the CNA Financial
Corporation 2000 Incentive Compensation Plan (the "Plan"), has determined that
you are eligible for an option (the "Option") to purchase shares of stock of the
Company (the "Covered Shares") for $_____ per share (the "Exercise Price"). This
Option was granted under the Plan on [Date].

As described more fully in the attached Award Terms, the Option will become
exercisable in four equal annual installments on [Date] of [year], [year],
[year] and [year] so long as you are employed by Continental Casualty Company or
an affiliate on each such date. For example, one quarter of the Option granted
will be exercisable on [Date] if you are an employee on that date. In most
instances, after the Option becomes exercisable generally you may exercise it
any time prior to the expiration date shown above provided that you are employed
by Continental Casualty Company or an affiliate at the time of exercise. After
exercising the option, you can decide whether to hold or sell the Covered Shares
you have obtained, subject to CNA's Securities Compliance Policy and applicable
insider trading restrictions.

Under the present tax laws, as a result of exercising the Option you will
potentially recognize taxable income at the time of exercise. When and if you
sell the Covered Shares acquired through the Option exercise, any additional
gain may be subject to further tax at capital gain rates. The Company recommends
that you consult with your individual tax advisor to determine the applicability
of the tax rules to the awards granted to you in your personal circumstances.

This Award Letter provides a summary of your Option, and the Award is subject to
the Award Terms enclosed with this Award Letter. (In the attached Award Terms,
you are referred to as the "Participant.") This Award Letter shall be subject to
the Award Terms, and the Award Terms shall be subject to the provisions of the
Plan. If discrepancies arise between this Award Letter and the Award Terms, the
Award Terms will govern, and if discrepancies arise between the Award Terms and
the Plan document, the terms of the Plan document will govern.



Sincerely,


</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99.2
<SEQUENCE>3
<FILENAME>c92171exv99w2.txt
<DESCRIPTION>FORM OF AWARD TERMS
<TEXT>
<PAGE>
                                                                    EXHIBIT 99.2



                     Stock Option Terms for Grant Under the
           CNA Financial Corporation 2000 Incentive Compensation Plan

         On [Date] (the "Grant Date"), CNA Financial Corporation (the "Company")
granted to the Participant an option (the "Option") to purchase a number of
Covered Shares of the Company's common stock (as defined below). The Option
shall be subject to the following Stock Option Terms (sometimes referred to as
the "Award Terms"):

         1. Option Award. For purposes of the Award Terms, the "Participant"
shall be the eligible person identified in the award letter included with these
Award Terms (the "Award Letter") and reflecting the date of grant of the Option
that is the same as the Grant Date specified in these Award Terms. For purposes
of the Award Terms, the "Covered Shares" and the "Exercise Price" are,
respectively, the total number of shares the Participant may purchase pursuant
to the Option, and the price per share for such purchase, as specified in the
Award Letter. The Option has been granted under the CNA Financial Corporation
2000 Incentive Compensation Plan (the "Plan"), which is incorporated into and
forms a part of the Award Terms. Certain words, terms and phrases used in the
Award Terms are defined in the Plan (rather than in the Award Terms or Award
Letter), and except where the context clearly implies or indicates the contrary,
and except as otherwise provided in the Award Terms, a word, term, or phrase
used or defined in the Plan is similarly used or defined in the Award Terms and
the Award Letter. Other words, terms or phrases used in the Award Terms or Award
Letter are defined in paragraph 11 of these Award Terms or elsewhere in these
Award Terms or Award Letter.

         2. Non-Qualified Option. The Option is not intended to constitute an
"incentive stock option" as that term is used in Section 422 of the Internal
Revenue Code.

         3. Date of Exercise. Subject to the limitations of the Plan and these
Award Terms, each installment of Covered Shares of the Option shall be
exercisable on and after the Date of Exercisability for such Installment as
described in the following schedule (but only if the Date of Termination has not
occurred before the Date of Exercisability):

        INSTALLMENT             DATE OF EXERCISABILITY APPLICABLE TO INSTALLMENT
        -----------             ------------------------------------------------
First 1/4 of Covered Shares              First anniversary of [Grant Date]
Second 1/4 of Covered Shares            Second anniversary of [Grant Date]
Third 1/4 of Covered Shares              Third anniversary of [Grant Date]
Fourth 1/4 of Covered Shares            Fourth anniversary of [Grant Date]

The Option may be exercised on or after the Date of Termination as provided for
herein only as to that portion of the Covered Shares for which it was
exercisable (or became exercisable) immediately prior to the Date of
Termination, if any.

         4. Expiration. The Option shall not be exercisable after the Company's
close of business on the last business day that occurs prior to the Expiration
Date. The "Expiration Date" shall be earliest to occur of:

(a)      Ten Years. The ten-year anniversary of the Grant Date.



<PAGE>


(b)      Death or Disability. The one-year anniversary of such Date of
         Termination, if the Participant's termination of employment by
         Continental Casualty Company or an Affiliate occurs by reason of the
         Participant's death or the Participant's Permanent Disability.

(c)      Retirement. The three-year anniversary of such Date of Termination, if
         the Participant's termination of employment by Continental Casualty
         Company or an Affiliate occurs by reason of the Participant's
         Retirement (and not by reason of death, Permanent Disability, or for
         Cause).

(d)      Cause. The Date of Termination, if the Participant's termination occurs
         by reason of Cause.

(e)      Voluntary Resignation. The Date of Termination, if the Participant's
         termination of employment by Continental Casualty Company or an
         Affiliate occurs by reason of the Participant's voluntary resignation
         (and the termination is for reasons other than as described in
         paragraphs (b), (c), or (d) next above, or paragraph (f) next below);
         provided, however, that the Incentive Compensation Committee of the
         Company's Board of Directors (the "Committee'), in its sole discretion,
         may provide for extension of the date specified in this paragraph (e),
         except that such extended date may not be later than the earlier of the
         90 day anniversary of the Date of Termination or the date specified in
         paragraph (a) next above.

(f)      Termination without Cause. The Date of Termination, if the
         Participant's termination of employment by Continental Casualty Company
         or an Affiliate occurs by reason of termination of employment by the
         Participant's employer for reasons other than Cause (and the
         termination is for reasons other than as described in paragraphs (b),
         (c), or (d), next above); provided, however, that the Committee, in its
         sole discretion, may provide for extension of the date specified in
         this paragraph (f), except that such extended date may not be later
         than the earlier of the one-year anniversary of the Date of Termination
         or the date specified in paragraph (a) next above; and further provided
         that, notwithstanding the provisions of paragraph 3, the Committee may,
         in its sole discretion, permit additional exercisability of the Option
         to be earned during such extension period.

         5. Method of Option Exercise. The Option may be exercised in whole or
in part by filing a written notice with the Secretary of the Company at its
corporate headquarters before the Company's close of business on the last
business day that occurs prior to the Expiration Date, or, if offered by the
Company at the Company's discretion, by electing to exercise the Option through
a Company-arranged broker-dealer. Each exercise of the Option shall be subject
to the Award Letter, the Award Terms and the Plan, and also to the following
provisions:

(a)      Any notice of exercise shall specify the number of Covered Shares which
         the Participant elects to purchase, and shall be accompanied by payment
         of the Exercise Price for such Covered Shares of stock indicated by the
         Participant's election.

(b)      Payment shall be by check payable to the Company. Except as otherwise
         provided by the Committee before the Option is exercised, the
         Participant may pay the Exercise Price by authorizing a third party to
         sell shares of Covered Shares of stock (or a sufficient portion of
         those shares) acquired upon exercise of the Option and remit to the
         Company a sufficient portion of the sale proceeds to pay the entire
         Exercise Price and any tax withholding resulting from such exercise.

(c)      The Option shall not be exercisable if and to the extent the Company
         determines in its sole discretion that such exercise would be in
         violation of applicable state or federal securities laws or the rules
         and regulations of any securities exchange on which the Covered Shares
         of stock are


                                       -2-

<PAGE>

         traded. If the Company makes such a determination, it shall use
         reasonable efforts to obtain compliance with such laws, rules or
         regulations. In making any determination hereunder, the Company may
         rely on the opinion of counsel for the Company.

         6. Administration. The authority to manage and control the operation
and administration of the Award Terms shall be vested in the Committee, and the
Committee shall have all powers with respect to the Award Terms as it has with
respect to the Plan. Any interpretation of the Award Terms by the Committee and
any decision made by it with respect to the Award Terms is final and binding on
the Company and the Participant.

         7. Fractional Shares. In lieu of issuing a fraction of a Covered Share
upon any exercise of the Option, resulting from an adjustment of the Option
pursuant to paragraph 4.2 of the Plan or otherwise, the Company will be entitled
to pay to the Participant an amount equal to the fair market value of such
fractional Covered Share.

         8. No Rights As Shareholder. The Participant shall not have any rights
of a shareholder with respect to the Covered Shares subject to the Option,
unless and until a stock certificate for such Covered Shares has been duly
issued following exercise of the Option as provided herein.

         9. Governing Documents. The Award Letter shall be subject to the Award
Terms, and the Award Terms shall be subject to the provisions of the Plan, a
copy of which may be obtained by the Participant from the office of the
Secretary of the Company. If discrepancies arise between these Award Terms and
the Plan document, the terms of the Plan document will govern. The Award Terms
are subject to all interpretations, amendments, rules, and regulations
promulgated by the Committee from time to time pursuant to the Plan.

         10. Amendment. The Award Terms may be amended by written agreement of
the Participant and the Company, without the consent of any other person except
that any such amendment shall be subject to the approval of the Committee.

         11. Definitions. For purposes of the Award Terms, the following
definitions shall apply:

(a)      Affiliate. The term "Affiliate" means any business or entity in which
         at any relevant time the Company holds directly or indirectly a greater
         than a 10% equity (voting or non-voting) interest.

(b)      Cause. The Participant will have engaged in conduct that constitutes
         "Cause" if the Participant i) engages in any conduct which the Chief
         Executive Officer of the Company's insurance subsidiaries reasonably
         determines to be fraudulent, constitute willful malfeasance or gross
         negligence, or be inconsistent with the dignity and character of an
         executive of the Company or ii) violates in a material manner the then
         current rules of professional conduct or human resource policies of the
         Company. If the Participant has entered into an employment contract
         with the Company or any Subsidiary and "Cause" is defined in such
         contract, then "Cause" for purposes of these Award Terms shall be as
         defined in such contract in lieu of the definition in the immediately
         prior sentence.

(c)      Date of Exercisability. The Participant's "Date of Exercisability" is
         the date on which the specified amount of options are first able to be
         exercised as provided for in paragraph 3 of these Award Terms.

(d)      Date of Termination. The Participant's "Date of Termination" shall be
         the first day occurring on or after the Date of Grant on which the
         Participant is not employed by Continental Casualty Company


                                       -3-

<PAGE>

         or an Affiliate, regardless of the reason for the termination of
         employment; provided that a termination of employment shall not be
         deemed to occur by reason of a transfer of the Participant's employment
         between Continental Casualty Company and an Affiliate or between two
         Affiliates; and further provided that the Participant's employment
         shall not be considered terminated while the Participant is on a leave
         of absence from Continental Casualty Company or an Affiliate approved
         by the Participant's employer. If, as a result of a sale or other
         transaction, the Participant's employer ceases to be an Affiliate (and
         the Participant's employer is or becomes an entity that is not an
         Affiliate), the occurrence of such transaction shall be treated as the
         Participant's Date of Termination caused by the Participant being
         discharged by the employer.

(e)      Permanent Disability. The term "Permanent Disability" means a physical
         or mental condition of Participant which, as determined by the Company,
         in its sole discretion based on all available medical information, is
         expected to continue indefinitely and which renders Participant
         incapable of substantially performing of the services required of him
         by his employer.

(f)      Retirement. Termination because of "Retirement" shall mean the
         Participant's Date of Termination after attainment of age 62 or, if
         earlier, the Participant's Date of Termination which is designated by
         the Committee as a "Retirement" for purposes of the Award Terms.





</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
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