EXHIBIT 10.22
EMPLOYMENT AGREEMENT
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THIS EMPLOYMENT AGREEMENT is made as of the 16th day of October, 1995
by and between XXXXXXX XXXXXXXXX ("Xxxxxxxxx"), on the one hand, and CITY
NATIONAL BANK, a National Bank ("CNB") and CITY NATIONAL CORPORATION ("Parent
Corporation"), on the other hand.
1. Employment. CNB and Parent Corporation (collectively the
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"Employer") hereby employs Xxxxxxxxx, and Xxxxxxxxx hereby accepts employment,
under the terms and conditions hereafter set forth.
2. Duties. Xxxxxxxxx shall be employed as the Chairman of the Board
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of Directors and Chief Executive Officer of CNB and Vice-Chairman of the Board
of Directors and Chief Executive Officer of the Parent Corporation and his
powers and duties shall be consistent with such offices and positions. As Chief
Executive officer of Employer, Xxxxxxxxx shall supervise, control and be
responsible for all aspects of the business and affairs of Employer and their
subsidiaries.
3. Place of Service. Substantially all of Xxxxxxxxx'x duties shall
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be performed in Los Angeles and Beverly Hills, California and unless mutually
agreed upon by Xxxxxxxxx and Employer, Xxxxxxxxx shall be headquartered in
Beverly Hills, California.
4. Term. Subject to the provisions for termination as hereinafter
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provided, the term of this Agreement shall commence on October 16, 1995 (the
"Start Date") and shall terminate three (3) years thereafter.
5. Annual Base Compensation. Employer shall pay Xxxxxxxxx as annual
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base compensation, payable in equal semimonthly payments, the sum of Four
Hundred Twenty Thousand Dollars ($420,000) during the first year of the term
hereof, the sum of Four Hundred Fifty Thousand Dollars ($450,000) during the
second year of the term hereof and the sum of Four Hundred Eighty Thousand
Dollars ($480,000) during the third year of the term hereof.
6. Bonus Compensation. Xxxxxxxxx shall participate in CNB's
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Executive Management Bonus Plan and any other cash bonus or incentive
compensation plan of Employer established for executive officers and the amount
of bonus or incentive compensation paid to Xxxxxxxxx pursuant to said plans for
any year (including the fiscal year ending December 31, 1995 and the fiscal year
during which his employment is terminated) in terms of a percentage of his then
annual salary shall be no less than the percentage of annual salary paid as a
bonus or incentive compensation to any other member of executive management of
Employer.
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7. Stock Options. Xxxxxxxxx shall be granted on the Start Date, non-
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qualified stock options to purchase an aggregate of three hundred fifty thousand
(350,000) shares of Common Stock of Parent Corporation at a purchase price equal
to the fair market value of the Common Stock on that date. Said options shall
be granted pursuant to the provisions of the 1985 Stock Option Plan of Parent
Corporation and shall be represented by an agreement substantially in the form
of the agreement annexed hereto as Exhibit A. Such options shall have a term of
ten years and subject to subparagraphs 10(b), (c), (d) and (e) hereof shall be
exercisable as to one hundred sixteen thousand six hundred sixty seven (116,667)
shares of Common Stock from and after the Start Date, as to an additional one
hundred sixteen thousand six hundred sixty seven (116,667) shares of Common
Stock from and after one year from the Start Date and in full from and after two
years from the Start Date.
8. Fringe Benefits and Reimbursement of Expenses. Employer shall
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provide Xxxxxxxxx with such medical and other health, dental, accidental life
and disability insurance, and he shall be entitled to all employee and fringe
benefits and reimbursement of expenses and to participate in all benefit plans
(including stock option plans) as are consistent with his position and duties
and those previously provided to the Chief Executive Officer of Employer;
provided, however, that during the first two years of the term hereof Employer
shall not be required to grant any employee stock options to Xxxxxxxxx.
9. Extent of Service. Xxxxxxxxx shall devote his time, attention and
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energies to the business of Employer and shall not, during the term of this
Agreement, be engaged in any other activity which will materially interfere with
the performance of his duties hereunder. Time expended by Xxxxxxxxx on
philanthropic activities, as a general partner of Sunbar Properties, as a
passive investor in real estate ventures and other investments, or in managing
the existing properties of Xxxxxxxxx Entertainment Corporation shall be deemed
not to interfere with the performance of his duties hereunder.
10. Termination of Employment.
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(a) Termination by Employer for Good Cause. Employer may terminate
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the employment of Xxxxxxxxx for "good cause" by written notice to Xxxxxxxxx.
For purposes of this Agreement, "good cause" shall mean only (i) conviction of a
crime directly related to his employment hereunder, (ii) conviction of a felony
involving moral turpitude, (iii) willful and gross mismanagement of the
business and affairs of Employer, or (iv) breach of any material provision of
this Agreement. In the event the employment of Xxxxxxxxx is terminated pursuant
to this subparagraph 10(a), Employer shall have no further liability to
Xxxxxxxxx other than for compensation accrued through the date of termination
but not yet paid.
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In the event Employer contends that it has good cause to terminate
Xxxxxxxxx pursuant to clause (iii) or (iv) of the second sentence of this
subparagraph 10(a), Employer shall provide Xxxxxxxxx with written notice
specifying in reasonable detail the services or matters which it contends
Xxxxxxxxx has not been adequately performing, or the material provisions of this
Agreement of which Xxxxxxxxx is in violation and the acts constituting such
violation, why Employer has good cause to terminate this Agreement, and what
Xxxxxxxxx should do to adequately perform his obligations hereunder. If within
thirty (30) days of receipt of the notice Xxxxxxxxx performs the required
services or modifies his performance to correct the matters complained of,
Xxxxxxxxx'x breach will be deemed cured, and Xxxxxxxxx'x employment shall not be
terminated. However, if the nature of the service not performed by Xxxxxxxxx or
the matters complained of are such that more than thirty (30) days are
reasonably required to perform the required service or to correct the matters
complained of, then his breach will be deemed cured if he commences to perform
such service or to correct such matters within the thirty (30) day period and
thereafter diligently prosecutes such performance or correction to completion.
If Xxxxxxxxx does not perform the required services or modify his performance to
correct the matter complained of within the thirty (30) day period or the
extension thereof, Employer shall have the right to terminate this Agreement at
the end of the thirty (30) day period or extension thereof. It is understood
that Xxxxxxxxx'x performance hereunder shall not be deemed unsatisfactory solely
on the basis of any economic performance of Employer because this performance
will depend in part on a variety of factors over which Xxxxxxxxx has little
control.
(b) Termination by Employer Without Good Cause. Employer may
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terminate the employment of Xxxxxxxxx without "good cause" (as defined in
subparagraph 10(a) above) at any time during the term hereof by giving written
notice to Xxxxxxxxx specifying therein the effective date of termination. Upon
such notice being given, if not then exercisable in full, the options described
in Paragraph 7 hereof shall become exercisable in full. In the event the
employment of Xxxxxxxxx is terminated pursuant to this subparagraph 10(b)
without good cause, Employer shall be obligated to pay to Xxxxxxxxx his base
compensation as then in effect under paragraph 5 of this Agreement for a period
of eighteen months from the effective date of termination (which shall be in
lieu of any other amounts which would be payable to Xxxxxxxxx on account of such
termination pursuant to any separation pay plan or policy of Employer) and shall
reimburse Xxxxxxxxx for all expenses and costs incurred by him during such
eighteen month period in obtaining and maintaining medical and health insurance
(through COBRA or otherwise) for him, his spouse and dependents for such
eighteen month period which is equivalent to that provided to him by Employer at
the time of termination of his employment. Xxxxxxxxx shall have no duty to
mitigate and Employer shall have no right to offset any other compensation paid
to Xxxxxxxxx during the applicable time period.
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(c) Termination by Disability. Employer may terminate the employment
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of Xxxxxxxxx during the term hereof by written notice to Xxxxxxxxx if Xxxxxxxxx
shall become incapable of fulfilling his obligations hereunder because of injury
or physical or mental illness which shall exist or may reasonably be anticipated
to exist for a period of twelve (12) consecutive months or for an aggregate of
twelve (12) months during any twenty-four (24) month period. In the event the
employment of Xxxxxxxxx is terminated by Employer pursuant to this subparagraph
10(c) because of injury, physical or mental illness, Employer shall be obligated
(i) to pay Xxxxxxxxx his base compensation as then in effect under Paragraph 5
for a period of eighteen months from the effective date of termination of his
employment less any amount Xxxxxxxxx receives in lieu of salary while he is
alive during such period from private or government insurance programs,
exclusive of reimbursement of medical costs and (ii) reimburse Xxxxxxxxx for all
expenses and costs incurred by him during such eighteen month period in
obtaining and maintaining medical and health insurance (through COBRA or
otherwise) for him, his spouse and dependents for such eighteen month period
equivalent to that provided him by Employer at the time of termination of his
employment. If the employment of Xxxxxxxxx is terminated pursuant to this
subparagraph 10(c), the options described in Paragraph 7 shall, if not then
fully exercisable, upon such termination become exercisable in full.
(d) Termination by Death. Except for compensation accrued but not
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paid at the date of death and as provided in this subparagraph 10(d), the death
of Xxxxxxxxx during the term of this Agreement shall terminate this Agreement.
In the event of the death of Xxxxxxxxx during the term hereof, Employer shall be
obligated to pay to Xxxxxxxxx'x wife, if she is then living, or if she is not
then living, to whomever he shall have designated in writing to Employer, or if
no designation has been made by him, to his estate, Xxxxxxxxx'x base
compensation as then in effect at the time of his death under Paragraph 5 for a
period of eighteen months from the date of Xxxxxxxxx'x death. If not then fully
exercisable, the options described in Paragraph 7 shall upon Xxxxxxxxx'x death
become exercisable in full.
(e) Optional Termination by Xxxxxxxxx. Except for compensation
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accrued but not paid at the effective date of termination and as provided in
this subparagraph 10(e), Xxxxxxxxx may terminate this Agreement and his
employment with Employer by written notice to Employer for "good reason" at any
time during the term hereof and after the occurrence of a change in control of
CNB, specifying therein the effective date of termination. For purposes of this
Agreement "good reason" shall exist if (i) Xxxxxxxxx is no longer chief
executive officer of CNB and chief executive officer of a holding company which
owns all of the capital stock of CNB or (ii) more than fifty percent (50%) of
the combined voting power of the outstanding securities of such holding company
which owns all of the capital stock of CNB and of which Xxxxxxxxx is the chief
executive officer are beneficially owned (as hereinafter defined), directly or
indirectly, by any
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bank or corporation which beneficially owns, directly or indirectly, more than
fifty percent (50%) of the combined voting power of the outstanding securities
of a bank other than CNB. A change of control of CNB shall be deemed to have
occurred if any "person" (as that term is used in Sections 13(d) and 14(d) of
the Securities and Exchange Act of 1934 as amended), other than Xxxxxxxxx,
members of his family or City National Bank, Trustee of the Profit Sharing
Retirement Plan of City National Bank Employees, is or becomes the "beneficial
owner" (as that term is defined by the Securities and Exchange Commission for
purposes of Section 13(d) of the Securities and Exchange Act of 1934 as
amended), directly or indirectly, of securities of Parent Corporation or its
successors representing more than twenty percent (20%) of the combined voting
power of the outstanding securities of Parent Corporation. In the event the
employment of Xxxxxxxxx is terminated pursuant to the provisions of this
subparagraph 10(e), Employer shall thereafter compensate and reimburse Xxxxxxxxx
in the same manner and in the same amounts and for the same period and items as
provided in subparagraph 10(b) as if his employment had been terminated by
Employer without good cause effective upon the date he has specified, pursuant
to this subparagraph 10(e), as the effective date of the termination of his
employment. Xxxxxxxxx shall have no duty to mitigate and Employer shall have no
right to offset other compensation paid to Xxxxxxxxx during the applicable time
period. Notwithstanding anything in this subparagraph 10(e) to the contrary, in
no event shall Xxxxxxxxx be paid in any year any amount pursuant to this
Agreement that constitutes an "excess parachute payment" and is not deductible
by Employer under Section 280G of the Internal Revenue Code of 1986, as amended
(the "Code"), or any amendment thereto or any subsequently enacted legislation
of similar effect, and any amounts payable to Xxxxxxxxx pursuant to this
subparagraph 10(e) shall not exceed a sum equal to the product of 299% times an
amount equal to Xxxxxxxxx'x "base amount" for the period consisting of the most
recent five taxable years ending before the date on which the change of control
occurs as defined in and determined in accordance with Section 280G of the Code.
(f) Termination Upon Expiration. At least six (6) months prior to the
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end of the term hereof, a person designated by the Board of Directors of Parent
Corporation shall meet with Xxxxxxxxx for purposes of negotiating an extension
of the term of this Agreement. If by the ninetieth (90th) day prior to the end
of the term hereof, Employer and Xxxxxxxxx have not agreed in writing to an
extension of the term hereof or renewal of this Agreement, Employer shall be
obligated to pay Xxxxxxxxx from and after the expiration of the term hereof his
base compensation as in effect under Paragraph 5 of this Agreement immediately
prior to the expiration of the term hereof for a period of twelve (12) months
from the end of the term of this Agreement and shall reimburse Xxxxxxxxx for all
expenses and costs incurred by him during such twelve (12) month period in
obtaining and maintaining medical and health insurance (through COBRA or
otherwise) for him, his spouse and dependents for such twelve (12) month period
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which is equivalent to that provided to him by Employer at the time of
termination of his employment.
11. Entire Agreement; Modification; Waiver. This Agreement and the
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agreement referred to in the Exhibit attached hereto constitute the entire
agreement between the parties pertaining to the subject matter contained therein
and supersedes all prior and contemporaneous agreements, representations and
understandings of the parties. No supplement, modification or amendment of this
Agreement shall be binding unless executed in writing by both parties. No
waiver of any of the provisions of this Agreement shall be deemed, or shall
constitute, a waiver of any other provisions, whether or not similar, nor shall
any waiver constitute a continuing waiver. No waiver shall be binding unless
executed in writing by the party making the waiver.
12. Separability Clause. The invalidity or unenforceability of any
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provision hereof shall in no way affect the validity or enforceability of any
other provision hereof.
13. Benefit. Except as herein and otherwise specifically provided, this
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Agreement shall be binding upon and inure to the benefit of the parties, their
personal representatives, heirs, administrators, executors, successors, and
permitted assigns.
14. Notices. Any notice, request, or other communication required to be
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given pursuant to the provisions of this Agreement shall be in writing and shall
be deemed to be duly given if delivered in person or mailed by registered or
certified United States mail, postage prepaid, and mailed to the parties at the
following addresses:
EMPLOYER XXXXXXX XXXXXXXXX
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City National Bank Xx. Xxxxxxx Xxxxxxxxx
000 Xx. Xxxxxxx Xxxxx 000 X. Xxxxxxx Xxxxx
Xxxxxxx Xxxxx, XX 00000 Beverly Hills, CA
Attn: Xxxxxxx X. Xxxxxxx, Xx.
General Counsel with copy to:
Xxxxx X. Xxxxxx
Sanders, Barnet, Xxxxxxx,
Xxxxxx & Mosk
Suite 850
1901 Avenue of the Stars
Xxx Xxxxxxx, XX 00000
The parties hereto may change the above addresses from time to time by
giving notice thereof to each other in conformity with this Paragraph 14.
15. Confidentiality. Xxxxxxxxx covenants and agrees with Employer that
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Xxxxxxxxx shall not, during or after the term of this Agreement, disclose to
anyone any confidential information concerning the business or operations of
Employer which Xxxxxxxxx may acquire in the course of or incident to the
performance of
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his duties hereunder, including, without limitation, processes, customer lists,
business or trade secrets, or methods or techniques used by Employer in its
business or operations.
16. Construction. This Agreement shall be governed by, and construed in
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accordance with, the laws of the State of California.
17. Captions. The paragraph headings and captions contained herein are
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for reference purposes and convenience only and shall not in any way affect the
meaning or interpretation of this Agreement.
18. Counterparts. This Agreement may be executed in one or more
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counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
19. Amendments. This Agreement shall not be modified, amended, or in any
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way altered except by an instrument in writing and signed by both of the parties
hereto.
20. Mandatory Arbitration. At the request of Xxxxxxxxx or Employer, any
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dispute, claim, controversy of any kind (whether in contract or tort, statutory
or common law, legal or equitable) now existing or hereafter arising out of,
pertaining to or in connection with this Agreement and/or any renewals,
extensions, or amendments thereto, shall be resolved through final and binding
arbitration conducted at a location determined by the arbitrator in Los Angeles
or Beverly Hills, California, and administered by the American Arbitration
Association ("AAA") in accordance with the Federal Arbitration Act, 9 U.S.C.
(S)1, et seq., and the then existing Commercial Arbitration Rules of the AAA.
Judgment upon any award rendered by the arbitrator(s) may be entered in any
State or Federal courts having jurisdiction thereof.
IN WITNESS WHEREOF, the parties hereto have executed this Employment
Agreement as of the date first above written at Beverly Hills, California.
CITY NATIONAL BANK
/s/ Xxxxxxx Xxxxxxxxx By: /s/ Xxxxxxx X. Xxxxxxx, Xx.
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XXXXXXX XXXXXXXXX Senior Vice President & Secretary
CITY NATIONAL CORPORATION
By: /s/ Xxxxxxx X. Xxxxxxx, Xx.
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Senior Vice President & Secretary
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