EXHIBIT 10.1
FORM OF UNIONBANCAL CORPORATION
PERFORMANCE SHARE AGREEMENT
This Agreement is made as of January 1, 2006, (the "Award Date"), between
UNIONBANCAL CORPORATION (the "Company" or "UNBC") and ___________________
("Participant").
WITNESSETH:
WHEREAS, the Company has adopted the 1997 UnionBanCal Corporation Performance
Share Plan, as amended and restated (the "Plan") authorizing the grant of Target
Awards of Performance Shares to eligible individuals in connection with the
performance of services for the Company and its Subsidiaries (as defined in the
Plan). The Plan, including the definition of terms, is incorporated in this
Agreement by reference and made a part of it. In the event of any conflict among
the provisions of the Plan document and this Agreement, the Plan document shall
prevail; and
WHEREAS, the Company regards Participant as a valuable contributor to the
Company, and has determined that it would be to the advantage and interest of
the Company and its shareholders to grant to Participant the Target Award of
Performance Shares provided for in this Agreement, subject to performance
against certain criteria, as an inducement to remain in the service of the
company and as an incentive for increased efforts during such service;
NOW, THEREFORE, in consideration of the foregoing premises, and the mutual
covenants herein contained, the parties to this Agreement hereby agree as
follows:
1. TARGET AWARD. The Company hereby grants to Participant __________________
Performance Shares for the Performance Cycle extending from JANUARY 1, 2006
THROUGH DECEMBER 31, 2008. Performance Shares are not actual shares of
Company stock and, therefore, do not convey any shareholder rights.
2. EARNED AWARD. The number of Performance Shares actually earned will be
based on the Company's percentile ranking relative to the Peer Banks for
RETURN ON AVERAGE EQUITY, subject to any adjustments that may be made under
the provisions of this Agreement or of Section 8 of the Plan, for the years
2006, 2007, and 2008, according to the following table:
UNBC %ile Ranking Multiple of Target
vs. Peer Banks Award Earned
=> 75th %ile 2X
50th %ile 1X
25th %ile .25X
< 25th %ile 0X
The number of Performance Shares actually earned may be increased up to 20%
(except for Named Executive Officers), or decreased up to 20% at the
discretion of the Committee, subject to a maximum Earned Award of two times
the Target Award.
For UNBC percentile ranking between the 75th and 25th percentiles, other
than at the 50th percentile, the Committee may interpolate between levels
in order to determine the appropriate multiple of the Target Award.
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3. VALUE AND PAYMENT OF EARNED AWARDS. The value payable to Participant for an
Earned Award shall equal one share of Company common stock for each
Performance Share actually earned. The shares of Company common stock shall
be issued pursuant to the Company's Management Stock Plan within 2-1/2
months following the end of the Performance Cycle or credited to the
Participant's account as deferred stock units if deferred in accordance
with such procedures as the Company may prescribe. The Company shall, to
the extent required by law, have the right to deduct from payments the
amount of any federal, state or local taxes required by law to be withheld.
4. DESIGNATION OF BENEFICIARIES. On a form provided to the Company,
Participant may designate a beneficiary or beneficiaries to receive, in the
event of Participant's death, all or part of any amounts to be distributed
to Participant under the Plan.
5. EMPLOYEE RIGHTS. Participant may not assign or transfer his or her rights
under the Plan except as expressly provided under the Plan. Participation
in the Plan does not create a contract of employment, imply or confer any
other employment rights, or confer any ownership, security or other rights
to Company assets.
6. TERMINATION OF EMPLOYMENT. Termination prior to the end of the Performance
Cycle shall result in forfeiture of all opportunity to receive an Earned
Award, except as provided below:
(a) If Participant's employment is terminated at any time after the first
nine months of the Performance Cycle (i) under the provisions of the
Company's Separation Pay Plan (pursuant to which Participant has
executed a release agreement), or (ii) by reason of retirement
(defined below) or death, or if Participant becomes entitled to
long-term disability benefits under the Union Bank of California Long
Term Disability Plan after the first nine months of the Performance
Cycle, Participant (or Participant's beneficiary or estate in the
event of death) will be eligible to receive an Earned Award equal to
the sum of (1) the number of Performance Shares (as a multiple of the
Target Award) earned for the years in the Performance Cycle that were
completed prior to the termination of employment or disability, plus
(2) 100% of the Target Award for each of the years in the Performance
Cycle that were not completed prior to the termination of employment
or disability. For purposes of this Agreement, "retirement" means
termination of employment with the Company and its Subsidiaries after
attaining age sixty (60) with ten (10) years of service, or age
sixty-two (62) with five (5) years of service, with the Company or any
of its Subsidiaries.
(b) Payment for an Earned Award under Section 6(a) shall be made under
Section 3, in shares of common stock or deferred stock units credited
to the Participant's account, if applicable, within 2-1/2 months
following the employment termination date.
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(c) If Participant is on a leave of absence from the Company or a
Subsidiary because of disability, or for the purpose of serving the
government of the country in which the principal place of employment
of Participant is located, either in a military or civilian capacity,
or for such other purpose or reason as the Committee may approve,
Participant shall not be deemed during the period of such absence, by
virtue of such absence alone, to have terminated employment with the
Company or a Subsidiary except as the Committee may otherwise
expressly provide.
7. MANDATORY ARBITRATION. Any dispute arising out of or relating to this
Agreement, including its meaning or interpretation, shall be resolved
solely by arbitration before an arbitrator selected in accordance with the
rules of the American Arbitration Association. The location for the
arbitration shall be in San Francisco, Los Angeles or San Diego as selected
by the Company in good faith. Judgment on the award rendered may be entered
in any court having jurisdiction. The party the arbitrator determines is
the prevailing party shall be entitled to have the other party pay the
expenses of the prevailing party, and in this regard the arbitrator shall
have the power to award recovery to such prevailing party of all costs and
fees (including attorney fees and a reasonable allocation for the costs of
the Company's in-house counsel), administrative fees, arbitrator's fees and
court costs, all as determined by the arbitrator. Absent such award of the
arbitrator, each party shall pay an equal share of the arbitrator's fees.
All statutes of limitation which would otherwise be applicable shall apply
to any arbitration proceeding under this paragraph. The provisions of this
paragraph are intended by the Participant and the Company to be exclusive
for all purposes and applicable to any and all disputes arising out of or
relating to this Agreement. The arbitrator who hears and decides any
dispute shall have jurisdiction and authority only to award compensatory
damages to make whole a person or entity sustaining foreseeable economic
damages, and, shall not have jurisdiction and authority to make any other
award of any type, including without limitation, punitive damages,
unforeseeable economic damages, damages for pain, suffering or emotional
distress, or any other kind or form of damages. The remedy, if any, awarded
by the arbitrator shall be the sole and exclusive remedy for any dispute
which is subject to arbitration under this paragraph.
8. CALIFORNIA LAW. The Plan and this Agreement shall be construed and enforced
according to the laws of the State of California to the extent not
preempted by the federal laws of the United States of America.
9. SECTION 409A. Participant acknowledges that Participant's receipt of
certain benefits under this Agreement otherwise payable upon the
termination of employment may be subject to Section 409A of the Internal
Revenue Code or similar laws regulating the payment of deferred
compensation ("Section 409A"), which, if applicable, could require a delay
in the payment of such benefits for a period of at least six (6) months
following separation from service. Participant acknowledges and agrees that
should the Company in good faith determine that any such benefits to be
provided upon termination to Participant pursuant to this Agreement are
subject to Section 409A, the Company may delay the payment of such benefits
for at least six (6) months (or such other period as may be applicable),
after first notifying Participant of its intention to do so.
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IN WITNESS WHEREOF, the parties hereto have duly executed this Performance Share
Agreement as of the date first above written. The Participant also hereby
acknowledges receipt of a copy of the 1997 UnionBanCal Corporation Performance
Share Plan, as amended and restated.
UnionBanCal Corporation
By: _____________________________________
Xxxx Xxxxxx, Executive Vice President
__________________________________________________
Participant Signature
__________________________________________________
Participant Printed Name Employee #
__________________________________________________
Social Security Number
__________________________________________________
Street Address
__________________________________________________
City State Zip Code
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