Exhibit 10.12
EMPLOYMENT AGREEMENT
THIS AGREEMENT, effective as of September 21, 2000, is entered into by
and between Union Bank of California, N.A., a National Banking Association (the
"Bank"), and Xxxxxx X. Xxxxx ("Xx. Xxxxx"), an individual.
WHEREAS, Xx. Xxxxx currently is employed by the Bank as an Executive
Vice President;
WHEREAS, Xx. Xxxxx has been designated a policy making officer of the
Bank and UnionBanCal Corporation ("UNBC");
WHEREAS, the parties wish to terminate and supersede the existing terms
and conditions of Xx. Xxxxx'x employment with the Bank; and
WHEREAS, the Bank desires to continue to secure the services of Xx.
Xxxxx and Xx. Xxxxx desires to perform services for the Bank on the terms and
conditions set forth in this Agreement;
NOW THEREFORE, in consideration of the foregoing and of the material
promises and conditions contained in this Agreement, the parties agree as
follows:
1. REPRESENTATIONS AND WARRANTIES.
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The Bank represents that it is fully authorized to enter into this
Agreement. Xx. Xxxxx warrants that he is under no employment contract, bond,
confidentiality agreement, or any other obligation which would violate or be in
conflict with the terms and conditions of this Agreement or encumber his
performance of duties assigned to him by the Bank. Xx. Xxxxx further warrants
that he has not signed or committed to any employment or consultant duties or
other obligations which would divert his attention from the duties assigned to
him by the Bank under this Agreement. The parties do not intend to include
within the meaning of this paragraph Xx. Xxxxx'x service, in accordance with
Bank policy, for nonprofit, charitable, or trade associations or on the boards
of directors or other governing bodies of business enterprises unrelated to the
Bank and not in a business competitive with a business of the Bank.
2. EMPLOYMENT AND DUTIES.
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The Bank will continue to employ Xx. Xxxxx as an Executive Vice
President. Xx. Xxxxx also shall occupy the position of Chief Credit Officer,
subject to ratification by the Bank's Board of Directors (the "Board"). Xx.
Xxxxx hereby accepts such employment with the Bank. Xx. Xxxxx shall devote his
time, ability, attention, energy, knowledge and skill solely and exclusively to
performing all reasonable duties as an Executive Vice President and the Chief
Credit Officer of the Bank as assigned to him by the Bank's Chief Executive
Officer. In addition, Xx. Xxxxx shall continue to serve as a policy making
officer of the Bank and UNBC. It is the intention of the parties that at or
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before the expiration of the initial term of this Agreement, as set forth in
paragraph 3 hereof, Xx. Xxxxx shall relinquish the position of Chief Credit
Officer upon a determination by the Bank that Xx. Xxxxx'x services no longer are
required in that capacity. Thereafter, Xx. Xxxxx shall be offered a position
performing those duties for which he was responsible immediately prior to the
effective date of this Agreement, a mutually agreeable position with comparable
responsibilities and authority to that held by Xx. Xxxxx immediately prior to
the effective date of this Agreement, or a position of greater responsibility
and authority, provided that Xx. Xxxxx remains an employee in good standing, and
subject to ratification as may be required by the Board and/or the Board of
Directors of UNBC (the "UNBC Board") (when referred to collectively with the
Bank's Board, the "Boards"). The Bank shall offer such position to Xx. Xxxxx no
later than ninety (90) days prior to the expiration of the initial term of this
Agreement pursuant to paragraph 3 hereof.
3. TERM OF AGREEMENT; RENEWAL.
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The initial term of this Agreement shall be for three (3) years, unless
terminated earlier in accordance with the provisions of paragraph 7 hereof.
Thereafter, this Agreement shall be renewable from year to year upon mutual
agreement of the parties, subject to the provisions of paragraph 7 hereof.
4. COMPENSATION.
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a. BASE SALARY. In consideration for Xx. Xxxxx'x services to
the Bank during the time period in which this Agreement is effective,
Xx. Xxxxx shall receive a base salary of Three Hundred Thousand Dollars
($300,000.00) per annum to be paid in equal installments as per the
Bank's salary administration program every two (2) weeks, and subject
to annual review and increases at the discretion of the Executive
Compensation and Benefits Committee of the Board or any other committee
constituted by the Board for this purpose (as applicable, the
"Committee"). Annual base salary increases shall be competitive with
annual base salary increases for comparable executive positions at
banks of similar size and focus, as determined at the discretion of the
Committee.
b. SIGNING BONUS. Upon or about March 15, 2001, Xx. Xxxxx
shall receive a one-time signing bonus in the gross amount of Three
Hundred Thousand Dollars ($300,000.00). Such signing bonus shall be in
lieu of any payment that otherwise is or may become payable to Xx.
Xxxxx under the Bank's Senior Management Bonus Plan or any successor
thereto (the "Bonus Plan") for the calendar year 2000 performance
period, provided, however, that the payment of this additional cash
compensation may be deferred at the discretion of Xx. Xxxxx under the
Bank's Senior Management Deferred Compensation Plan or any successor
thereto (the "Deferred Compensation Plan"), subject to the eligibility
requirements and other terms and conditions of such Plan.
c. ADDITIONAL RESTRICTED STOCK. Xx. Xxxxx shall receive awards
of six thousand (6,000) shares of restricted stock each on September 1,
2001, September 1, 2002, and September 1, 2003, respectively, provided
that he is employed by the Bank on each applicable date and
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satisfactorily performing the duties assigned to him by the Bank, as
determined by the Bank in good faith, and subject to the vesting
requirements next described. Provided that Xx. Xxxxx is so employed by
the Bank, UNBC, or one of their subsidiaries on the applicable vesting
date, twenty-five percent (25%) of the award for calendar year 2001
(1,500 shares) shall vest on September 1, 2002, twenty-five percent
(25%) of such award (1,500 shares) shall vest on September 1, 2003,
twenty-five percent (25%) of such award (1,500 shares) shall vest on
September 1, 2004, and twenty-five percent (25%) of such award (1,500
shares) shall vest on September 1, 2005. Additional restricted stock
awards to Xx. Xxxxx in calendar years 2002 and 2003 pursuant to this
subparagraph 4(d) shall be subject to four-year vesting provisions
substantially similar to those set forth above. Xx. Xxxxx shall forfeit
any portion of the award that is not vested on the date he ceases to be
employed by the Bank, UNBC and their subsidiaries, unless his
termination of employment arises under circumstances described in
subparagraphs 7(a), 7(b), 7(d) or 7(f), in which case shares not yet
awarded under this subparagraph 4(c) shall be awarded to Xx. Xxxxx at
the time of termination, and Xx. Xxxxx shall become one hundred percent
(100%) vested in all shares awarded to him under this subparagraph 4(c)
at the time of termination if not already so vested. Except as
otherwise provided for in this subparagraph 4(c), the terms and
conditions of the UNBC Management Stock Plan or any successor thereto
(the "UNBC Stock Plan") shall govern in all other respects the
administration of the restricted stock awarded to Xx. Xxxxx hereunder.
5. ADDITIONAL BENEFITS.
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During his employment under this Agreement:
a. BONUS. Except as limited by the provisions of subparagraph
4(b) hereof with respect to the calendar year 2000 performance period,
Xx. Xxxxx shall be entitled to participate in the Bonus Plan, subject
to the eligibility requirements and other terms and conditions of such
Plan and the determinations of the administrator of such Plan. Xx.
Xxxxx'x bonus opportunity as set forth in the Employment Agreement
between Xx. Xxxxx and the Bank dated July 1, 1999 (which has been
superseded by this Agreement) shall remain unchanged, based on
comparable performance by Xx. Xxxxx. Specifically, Xx. Xxxxx'x target
bonus under the Bonus Plan shall be sixty percent (60%) of base salary
(with a maximum bonus opportunity of one hundred twenty percent
(120%)), subject to annual review and increases or decreases at the
discretion of the Committee.
b. LONG TERM INCENTIVES. Xx. Xxxxx shall be eligible for long
term incentive awards available to policy making officers. Awards may
consist of one or more types of long term incentives, including the
grant of stock options and restricted stock under the UNBC Stock Plan
and the award of performance shares under the UNBC Performance Share
Plan or any successor thereto. Xx. Xxxxx'x target award shall be valued
at one hundred ten percent (110%) of base salary. Notwithstanding the
preceding sentence, determinations of the amount of any award to Xx.
Xxxxx shall be made at the discretion of the Committee, subject to
annual review and increases or decreases, based on the median long term
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incentive targets for comparable executive positions at banks of
similar size and focus, as determined at the discretion of the
Committee.
c. RETIREMENT AND 401(K) PLAN. Xx. Xxxxx shall be entitled to
participate in the Bank retirement and 401(k) plans that are now or
hereafter will be in effect, subject to the eligibility requirements
and other terms and conditions of such plans and the determinations of
the administrator of such plans.
d. SUPPLEMENTAL RETIREMENT BENEFITS. During his employment
under this Agreement Xx. Xxxxx shall be a participant under the Bank's
Supplemental Executive Retirement Plan (the "SERP") and under the Union
Bank Executive Supplemental Benefit Plan (the latter of which is a plan
of a predecessor of the Bank); copies of each plan are attached hereto
as Exhibit D. The supplemental plans referred to in the preceding
sentence, together with the Bank's retirement plans now or hereafter in
effect, shall collectively be referred to hereinafter as the
"Retirement Plans."
e. INSURANCE AND WELFARE PLANS. Xx. Xxxxx and his eligible
dependents shall be eligible to receive such other benefits or rights
as may be provided under any employee benefit plan provided by the Bank
that is now or hereafter will be in effect (including participation in
life, medical, disability, dental and vision insurance plans), subject
to eligibility requirements and other terms and conditions of such
plans and the determinations of administrators of such plans.
f. OTHER BENEFITS. The Bank shall provide other benefits such
as a car allowance, luncheon and country club expenses, and other
perquisites as determined by the Committee for similarly situated
executives.
g. BUSINESS EXPENSES. Xx. Xxxxx shall be entitled to
reimbursement by the Bank for such customary, ordinary and necessary
business expenses as are incurred by him in the performance of his
duties and activities associated with promoting or maintaining the
business of the Bank. All expenses as described in this subparagraph
5(g) will be reimbursed only upon presentation by Xx. Xxxxx of such
documentation in accordance with Bank policy and as may be reasonably
necessary to substantiate that all such expenses were incurred in
performance of his duties.
h. VACATION AND SICK LEAVE. Xx. Xxxxx shall be entitled to
earn (i) four (4) weeks' paid vacation each year of employment under
this Agreement and (ii) sick leave on the same basis as other Bank
employees and subject to all accrual or accumulated maximum entitlement
limitations which currently or may hereafter exist under the Bank's
vacation and sick leave policies.
i. DEFERRED COMPENSATION. Xx. Xxxxx shall be entitled at his
discretion to defer payment of any or all cash compensation due to him
under this Agreement under the Deferred Compensation Plan, subject to
the eligibility requirements and other terms and conditions of such
Plan.
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6. OUTSIDE ACTIVITIES AND NON-COMPETITION.
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During the term of this Agreement, and subject to paragraph 1, Xx.
Xxxxx shall devote his time, ability, attention, energy, knowledge and skill to
the business of the Bank. During the term of this Agreement, Xx. Xxxxx shall
not, directly or indirectly, either as an employee, employer, consultant, agent,
principal, partner, shareholder, corporate officer, director, or in any other
capacity, engage or assist any third party in engaging in any business
competitive with the business of the Bank, UNBC, or their subsidiaries, without
the written approval of the Bank's Chief Executive Officer. Investments in
publicly traded corporations through brokerage accounts or in mutual funds, or
depositor/borrower relationships with other financial institutions are not
intended to be covered by this paragraph. Following his employment with the
Bank, Xx. Xxxxx shall not engage in unfair competition with the Bank or aid
others in any unfair competition with the Bank. For purposes of this Agreement,
"unfair competition" shall mean those activities prohibited or proscribed in the
"Competition and Business Promotion" section of the Bank's April 1999 revision
of the Business Standards of Conduct (except that the object of the prohibition
or proscription shall be read as the Bank rather than a competitor). Following
his employment with the Bank, Xx. Xxxxx shall not in any way breach the
confidence that the Bank has placed in him or misappropriate any proprietary
information of the Bank, as such prohibitions are described in the Bank's April
1999 revision of the Business Standards of Conduct.
7. TERMINATION OF EMPLOYMENT.
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This Agreement shall terminate as follows:
a. BY DEATH. This Agreement shall be terminated upon the
death of Xx. Xxxxx. The Bank's total liability to Xx. Xxxxx in the
event of termination of Xx. Xxxxx'x employment under this subparagraph
shall be limited to the payment (on his behalf) of Xx. Xxxxx'x salary
and benefits as set forth in paragraphs 4 and 5 of this Agreement
through the effective date of termination.
b. BY DISABILITY. If, in the sole opinion of the Bank's Chief
Executive Officer, governed by the exercise of good faith and supported
by competent medical opinion, Xx. Xxxxx is prevented from properly
performing his duties hereunder by reason of any physical or mental
incapacity, for a period of more than ninety (90) days in the aggregate
in any twelve (12) month period, then, to the extent permitted by law,
his employment with the Bank shall terminate. The Bank's total
liability to Xx. Xxxxx in the event of termination of Xx. Xxxxx'x
employment under this subparagraph shall be limited to the payment of
Xx. Xxxxx'x salary and benefits as set forth in paragraphs 4 and 5 of
this Agreement through the effective date of termination. Nothing in
this paragraph 7 is intended to preclude Xx. Xxxxx from exercising any
rights he may have under the Bank's Short Term Disability Plan or Long
Term Disability Plan or any respective successors thereto, in
accordance with the eligibility requirements and other terms and
conditions of such plans.
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c. FOR CAUSE. The Bank reserves the right to terminate this
Agreement immediately, at any time, if, in the opinion of the Bank's
Chief Executive Officer: Xx. Xxxxx materially and/or habitually
breaches or neglects the duties which he is required to perform under
the terms of this Agreement; commits any material act of dishonesty,
fraud, misrepresentation, or other material act which would violate the
Bank's Business Standards of Conduct; is guilty of gross carelessness
or misconduct; fails to obey the lawful direction of the Bank's Chief
Executive Officer or the Board; or acts in any way that has a direct,
substantial and adverse effect on the Bank's reputation. Nothing in the
phrase "acts in any way that has a direct, substantial and adverse
effect on the Bank's reputation" as used in the preceding sentence is
intended to include legally required or other reporting or disclosure
by Xx. Xxxxx of financial information regarding the Bank in the
ordinary course of his employment as an Executive Vice President or any
other title or position he may hold during the term of this Agreement.
The Bank's total liability to Xx. Xxxxx in the event of termination of
Xx. Xxxxx'x employment under this subparagraph shall be limited to the
payment of Xx. Xxxxx'x salary and benefits as set forth in paragraphs
4(a) and 5 of this Agreement through the effective date of termination.
d. WITHOUT CAUSE. The Bank reserves the right to terminate
this Agreement without cause, for any reason and at any time, by
written notice to Xx. Xxxxx from the Bank's Chief Executive Officer.
Xx. Xxxxx hereby agrees that the Bank may dismiss him under this
subparagraph 7(d) without regard to (i) any general or specific
policies (whether written or oral) of the Bank relating to the
employment or termination of its employees, or (ii) any statements made
to Xx. Xxxxx, whether made orally or contained in any document,
pertaining to Xx. Xxxxx'x relationship with the Bank. In the event of
termination under this subparagraph 7(d), and subject to the conditions
set forth herein, Xx. Xxxxx shall be entitled to receive the payments
described in (i) and (ii) below.
(i) If Xx. Xxxxx has not yet attained age 65 at the
time of his termination of employment, and provided Xx. Xxxxx
has, at the time of his termination of employment, executed
the "General and Special Release" (attached hereto as Exhibit
A), then in consideration for such Release, the Bank will
provide Xx. Xxxxx with:
(A) The greater of (I) two years of
separation pay payable as salary continuation on a
payroll by payroll basis, in an amount equal to Xx.
Xxxxx'x base salary at the time of his termination,
plus a prorated bonus amount each payroll period
equal to the average of Xx. Xxxxx'x annual bonus
(excluding any amount that represents an award of
long term incentives by the Bank) for the three (3)
most recent bonus determination years divided by the
number of payroll periods in the year, or (II) the
salary continuation amount payable under the Bank's
then existing separation pay plan; and
(B) Benefits (other than salary
continuation) available and/or payable to
participants at or above the level of Executive Vice
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Presidents for the salary continuation period under
the Bank's Separation Pay Plan in effect on the date
of this Agreement, or, if better, under the Bank's
separation pay plan in effect at the time of his
termination of employment. A true and correct copy of
the Plan as in effect on the date of this Agreement
is attached hereto as Exhibit B.
(ii) The Bank will provide Xx. Xxxxx with salary and
benefits as set forth in paragraphs 4 and 5 of this Agreement
through the effective date of termination.
A termination of this Agreement on account of Xx. Xxxxx'x
disability shall be governed by subparagraph 7(b) and not this
subparagraph 7(d). In addition, in the event Xx. Xxxxx dies while
receiving salary continuation benefits under subparagraph 7(d)(i)(A)
above, then Xx. Xxxxx shall have the remaining salary continuation, if
any, paid to his Designated Beneficiary under Exhibit C attached
hereto.
e. BY XX. XXXXX WITHOUT CAUSE. Xx. Xxxxx reserves the right
to terminate this Agreement for any reason (other than the reason set
forth in subparagraph 7(f)) upon reasonable written notice to the Bank.
The Bank's total liability to Xx. Xxxxx in the event of termination of
Xx. Xxxxx'x employment under this subparagraph shall be limited to the
payment of Xx. Xxxxx'x salary and benefits as set forth in paragraphs
4(a) and 5 of this Agreement through the effective date of termination.
f. BY XX. XXXXX FOR CAUSE. Subject to the further conditions
next described, Xx. Xxxxx may terminate this Agreement by giving sixty
(60) days' written notice to the Bank if he has incurred a material
reduction of his duties, title or responsibility (including Xx. Xxxxx
no longer serving in the capacity or under the title of Executive Vice
President and policy making officer), a reduction in his annual base
salary or a reduction in his overall compensation package below the
median package for comparable executive positions at banks of similar
size and focus (this peer group to be determined at the discretion of
the Committee). For purposes of this subparagraph 7(f), a material
reduction of Xx. Xxxxx'x duties, title or responsibility also shall
mean the failure of the Bank to offer Xx. Xxxxx a position satisfying
the conditions set forth in paragraph 2 hereof, or the failure of the
Board or Boards to ratify Xx. Xxxxx'x acceptance of such position,
provided, however, that Xx. Xxxxx remains an employee in good standing
at the time such event is to occur pursuant to paragraph 2 of this
Agreement. In order to elect to terminate this Agreement pursuant to
this subparagraph 7(f), Xx. Xxxxx must submit the written notice to the
Bank within sixty (60) days of the reduction. Xx. Xxxxx shall not be
entitled to elect to terminate this Agreement pursuant to this
subparagraph 7(f) if prior to Xx. Xxxxx'x termination date the Bank
corrects the deficiency upon which Xx. Xxxxx'x resignation is based. In
the event that Xx. Xxxxx is entitled to and elects to terminate this
Agreement pursuant to this subparagraph 7(f), (i) he shall be entitled
to receive salary and benefits as set forth in paragraphs 4 and 5 of
this Agreement through the effective date of termination, and (ii) if
he has not yet attained age 65 at the time of his termination of
employment and further has, at the time of his termination of
employment, previously executed the "General and Special Release"
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(attached hereto as Exhibit A), then in consideration for such Release,
the Bank will provide Xx. Xxxxx with the salary continuation and
benefits set forth in subparagraphs 7(d)(i)(A) and (B). In the event
Xx. Xxxxx dies while receiving salary continuation benefits described
in subparagraph 7(d)(i)(A) above, then Xx. Xxxxx shall have the
remaining salary continuation, if any, paid to his Designated
Beneficiary under Exhibit C attached hereto.
g. RESIGNATION OF POSITIONS. Upon termination of employment
for any reason whatsoever, Xx. Xxxxx shall be deemed to have resigned
from all offices and positions with the Bank, UNBC, and their
subsidiaries. Xx. Xxxxx agrees that, in connection with his termination
under this Agreement, he will tender such written resignations as
required by the Bank.
8. PROHIBITION OF ASSIGNMENT.
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This Agreement is personal to Xx. Xxxxx and he may not assign or
delegate any of his rights or obligations hereunder without first obtaining the
written consent of the Bank.
9. UNBC OR BANK SUCCESSOR.
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For all purposes under this Agreement, the term "UNBC" shall include
any successor to UNBC's business and/or assets, by purchase, merger,
consolidation, reorganization, liquidation or otherwise. For all purposes under
this Agreement, the term "Bank" shall include any successor to the Bank's
business and/or assets, by purchase, merger, consolidation, reorganization,
liquidation or otherwise, and, in such an event, for all purposes under this
Agreement, the term "UNBC" also shall mean the U.S. parent company to such
successor (and, if there is no such U.S. parent company, the successor itself).
This Agreement shall inure to the benefit of and be binding upon any such
successor to UNBC and the Bank to which Xx. Xxxxx'x employment is transferred.
10. ARBITRATION.
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With the exception of an action or proceeding in any court of competent
jurisdiction for the purpose of obtaining injunctive relief, any controversy
between the Bank, UNBC or their parent companies, subsidiaries and affiliates
and Xx. Xxxxx or between any employee of the Bank, UNBC or their parent
companies, subsidiaries and affiliates and Xx. Xxxxx, including, but not limited
to, any controversy arising out of Xx. Xxxxx'x employment or the termination
thereof, involving the construction or application of any of the terms,
provisions or conditions of this Agreement, or otherwise arising out of or
relating to this Agreement and any controversy arising out of or relating to
Exhibit A to this Agreement (the "General and Special Release") or involving a
claim of race, sex, religious, age, disability, medical condition (in and as
defined under California law), marital status, veteran status, sexual
orientation or national origin discrimination under Title VII of the Civil
Rights Act of 1964, as amended, the Americans with Disabilities Act of 1990, as
amended, the Age Discrimination in Employment Act, as amended, the Family and
Medical Leave Act, the California Fair Employment and Housing Act, or any other
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federal, state or local laws, shall be settled by arbitration in accordance with
the employment dispute resolution rules of the American Arbitration Association
determined by the Committee to most closely resemble the National Employment
Dispute Resolution Rules in effect on the effective date of this Agreement, and
judgment on the award rendered by the arbitrator(s) may be entered by any court
having jurisdiction thereof. Reasonable limited discovery will be permitted in
the form of the right of each party to take the deposition of one individual and
any expert witness designated by the other party. Each party shall also have the
right to make requests for discovery of relevant documents to the other party.
Additional discovery may be had only where the arbitrator so orders, upon a
showing of substantial need. The Bank and Xx. Xxxxx each shall bear their own
costs and legal fees associated with the arbitration, except that the arbitrator
shall have the right in his discretion to award reasonable legal fees to the
prevailing party in the arbitration. Notwithstanding the foregoing, the Bank
shall bear the cost of the arbitrator (including the costs of establishing a
facility for and otherwise administering the arbitration). The location of the
arbitration shall be in Los Angeles, California, and the arbitration shall be
conducted so as to result in the rendering of the arbitrator's decision within
ninety (90) days after the original demand for arbitration. The arbitrator shall
be required to issue written findings and conclusions underlying the basis of
such decision.
This paragraph 10 of this Agreement and the obligations provided for
herein shall survive the termination of this Agreement and remain in full force
and effect following the termination of Xx. Xxxxx'x employment with the Bank.
11. LIMITATION ON PAYMENTS.
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a. BASIC RULE. In the event Xx. Xxxxx becomes entitled to
payments under this Agreement in connection with his termination of
employment at a time when the Bank's Auditors determine that the
payments result in "excess parachute payments" under section 280G of
the Internal Revenue Code (the "Code"), then instead of the amounts
payable under this Agreement, Xx. Xxxxx shall receive aggregate
payments equal to the Reduced Amount, if such Reduced Amount would
result in net after-tax payments to Xx. Xxxxx that are greater than the
net after-tax payments he would have received without regard to this
paragraph. For purposes of this paragraph 11, the "Reduced Amount"
shall be the amount, expressed as a present value, that maximizes the
aggregate present value of the payments without causing any payment to
be nondeductible by the Bank under section 280G of the Code. All
calculations required by this paragraph 11 shall be performed by the
Bank's independent auditors retained most recently prior to the
transaction implicating section 280G of the Code (the "Auditors"),
based on information supplied by the Bank and Xx. Xxxxx, and shall be
binding on the Bank and Xx. Xxxxx. All fees and expenses of the
Auditors shall be paid by the Bank.
b. REDUCTIONS. If the amount of the aggregate payments to Xx.
Xxxxx must be reduced under this paragraph 11, then Xx. Xxxxx shall
direct in which order the payments are to be reduced, but no change in
the timing of any payment shall be made without the Bank's consent. As
a result of uncertainty in the application of sections 280G and 4999 of
the Code at the time of an initial determination by the Auditors
hereunder, it is possible that a payment will have been made by the
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Bank that should not have been made (an "Overpayment") or that an
additional payment that will not have been made by the Bank could have
been made (an "Underpayment"). In the event that the Auditors, based
upon the assertion of a deficiency by the Internal Revenue Service
against the Bank or Xx. Xxxxx that the Auditors believe has a high
probability of success, determine that an Overpayment has been made,
such Overpayment shall be treated for all purposes as a loan to Xx.
Xxxxx that he shall repay to the Bank, together with interest at the
applicable federal rate specified in section 7872(f)(2) of the Code;
provided, however, that no amount shall be payable by Xx. Xxxxx to the
Bank if and to the extent that such payment would not reduce the amount
that is nondeductible under section 280G of the Code or is subject to
an excise tax under section 4999 of the Code. In the event that the
Auditors determine that an Underpayment has occurred, such Underpayment
shall promptly be paid or transferred by the Bank to, or for the
benefit of, Xx. Xxxxx, together with interest at the applicable federal
rate specified in section 7872(f)(2) of the Code.
12. MODIFICATION.
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Any modification of this Agreement will be effective only if it is in
writing and signed by the parties to be bound thereby.
13. ENTIRE AGREEMENT.
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This Agreement constitutes the entire agreement between the Bank and
Xx. Xxxxx pertaining to the subject matter hereof, and supersedes all prior or
contemporaneous written or verbal agreements and understandings with Xx. Xxxxx
in connection with the subject matter hereof.
14. GOVERNING LAW.
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This Agreement and the rights and obligations hereunder shall
be governed by the laws of the State of California, and the parties to this
Agreement specifically consent to the jurisdiction of the courts of California
over any action arising out of or related to this Agreement.
15. SEVERABILITY.
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If any provision of this Agreement is held by a court of competent
jurisdiction to be invalid, void or unenforceable, the remaining provisions
shall, nevertheless, continue in full force and effect without being impaired or
invalidated in any way.
16. WAIVER.
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The parties hereto shall not be deemed to have waived any of their
respective rights under this Agreement unless the waiver is in writing and
signed by such waiving party. No delay in exercising any right shall be a waiver
nor shall a waiver on one occasion operate as a waiver of such right on a future
occasion.
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17. NOTICES.
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All notices provided for herein shall be in writing and shall be deemed
to have been given when delivered personally, when deposited in the United
States mail, registered or certified, postage prepaid, or when delivered to a
messenger service, addressed as follows:
To the Bank: Xxxx Xxxxxx
Executive Vice President
Union Bank of California, N.A.
000 Xxxxxxxxxx Xxxxxx
Xxx Xxxxxxxxx, XX 00000
or to the then current Director of Resources of the Bank at the time the notice
is given.
To Xx. Xxxxx: Xxxxxx X. Xxxxx
Executive Vice President
Union Bank of California, N.A.
000 Xxxxx Xxxxxxxx Xxxxxx
Xxx Xxxxxxx, XX 00000
or to Xx. Xxxxx at such home address as may be reflected in the Bank's records
at the time the notice is given.
18. EXECUTIVE COMPENSATION AND BENEFITS COMMITTEE.
---------------------------------------------
If at the time of a determination under this Agreement no Committee is
in existence, references to the Committee under this Agreement shall be deemed
to be references to the Board.
[THE REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK.]
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19. WITHHOLDING TAXES.
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The Bank shall withhold and deduct all applicable federal and local
taxes, as required by applicable laws, from any payments made under this
Agreement.
IN WITNESS WHEREOF, the parties have executed this Agreement by their
duly authorized officers or agents.
Dated: _______________ UNION BANK OF CALIFORNIA, N.A.
By_________________________________
Xxxx Xxxxxx
Executive Vice President
Dated: _______________ ____________________________________
Xxxxxx X. Xxxxx
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EXHIBIT A
GENERAL AND SPECIAL RELEASE
1. In return for the benefits provided for in subparagraphs 7(d)(i)
or 7(f)(ii) of the Employment Agreement entered into as of October 1, 2000 (the
"Agreement"), the adequacy of which as consideration is hereby acknowledged,
Xxxxxx X. Xxxxx (hereinafter "Xx. Xxxxx") hereby fully releases and forever
discharges Union Bank of California, N.A., its parent, affiliated, and
subsidiary corporations, its and their successors and assigns, and the past and
present officers, directors, employees, shareholders, agents and employee
benefit plans of each (hereinafter collectively the "Bank") from any and all
actions, causes of action, claims, demands, damages, and liabilities of
whatsoever kind or character, in law or in equity, now known or unknown,
suspected or unsuspected, past or present, that he has ever had or currently may
have against them or any of them including, but not limited to, claims of race,
sex, religious, age, disability, medical condition (in and as defined under
California law), marital status, veteran status, sexual orientation or national
origin discrimination under Title VII of the Civil Rights Act of 1964, as
amended, the Americans with Disabilities Act of 1990, as amended, the Age
Discrimination in Employment Act, as amended, the Family and Medical Leave Act,
the California Fair Employment and Housing Act, and any other federal, state or
local laws, arising out of or in any way related to Xx. Xxxxx'x employment with
the Bank or the termination of that employment. Xx. Xxxxx further agrees not to
institute in any state or federal court any action or claim of any kind against
the Bank. Execution of this document by Xx. Xxxxx operates as a complete bar and
defense against any and all current claims of any type that may be made by Xx.
Xxxxx against the Bank, provided, however, that nothing in this release is
intended to affect Xx. Xxxxx'x right to seek a remedy in arbitration to resolve
any controversy arising out of the construction or application of the terms,
provisions or conditions of the Agreement.
2. Xx. Xxxxx and the Bank understand and expressly agree that the
release granted in Paragraph 1 extends to all claims of every nature and kind,
known or unknown, suspected or unsuspected, past or present, which Xx. Xxxxx may
have against the Bank arising from or related to his employment with the Bank or
the termination of that employment and that any and all rights granted to Xx.
Xxxxx under Section 1542 of the California Civil Code or any analogous state
law, federal law, or regulation are hereby expressly waived. Section 1542 of the
California Civil Code provides that:
A general release does not extend to claims which the creditor does not
know or suspect to exist in his favor at the time of executing the
release, which if known by him must have materially affected his
settlement with the debtor.
3. Xx. Xxxxx has read this instrument, has had the opportunity of
consulting with an attorney regarding it, and signs it voluntarily and with the
intention of being bound by it. Xx. Xxxxx understands that he is waiving legal
rights by signing this Release.
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4. Xx. Xxxxx acknowledges that he has been given at least twenty-
one (21) days within which to consider this Release. Xx. Xxxxx understands that
he may revoke this Release upon written notice to the Bank within seven (7) days
after execution of it and that this Release will not become effective or
unenforceable until the eighth (8th) day after its execution.
Dated: _______________ ____________________________________
Xxxxxx X. Xxxxx
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EXHIBIT C
UNION BANK OF CALIFORNIA, N.A.
BENEFICIARY DESIGNATION
UNDER EMPLOYMENT AGREEMENT
Name: Xxxxxx X. Xxxxx
Social Security Number: ______-____-______
If I die while receiving salary continuation payments under subparagraphs 7(d)
or 7(f) of the Employment Agreement entered into as of October 1, 2000, then any
payments remaining to be made shall be paid to the person to whom I am married
at the time of my death. IN THE EVENT I HAVE NO SPOUSE AT THE TIME OF MY DEATH,
THEN PAYMENT IS TO BE MADE AS FOLLOWS [CHECK ONE BOX ONLY]:
[ ] To all of my children who survive me in equal shares. [Please provide
names and addresses below.] The term "children" means natural or
legally adopted children but excludes stepchildren (if not adopted).
[ ] To my estate.
[ ] Other [please enter a description , and provide names and addresses, if
necessary]:
____________________________________________________________
____________________________________________________________
____________________________________________________________
IN THE EVENT NO DESIGNATED BENEFICIARY SURVIVES ME, ANY REMAINING
PAYMENTS SHALL BE MADE TO MY ESTATE.
The names and addresses of my beneficiaries are as follows [please use a
separate sheet if necessary]:
1. Name: _________________________ Relationship: _______________
Address: _____________________________________________________
2. Name: _________________________ Relationship: _______________
Address: _____________________________________________________
3. Name: _________________________ Relationship: _______________
Address: _____________________________________________________
4. Name: _________________________ Relationship: _______________
Address: _____________________________________________________
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This beneficiary designation is to take effect on the date when it is received
by the Director of Human Resources of Union Bank of California, N.A., and it
supersedes any prior designations that I may have made under the
above-referenced Employment Agreement.
Dated: _______________ ____________________________________
Xxxxxx X. Xxxxx
Date of receipt: ________________
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