EMPLOYMENT AGREEMENT
THIS AGREEMENT, effective as of January 1, 1998, is entered into by and
between Union Bank of California, N.A., a National Banking Association (the
"Bank"), and Richard C. Hartnack ("Mr. Hartnack"), an individual.
WHEREAS, Mr. Hartnack is currently employed by the Bank as Vice Chairman
and Group Head, Retail Banking ("Vice Chairman");
WHEREAS, Mr. Hartnack has been designated a policy making officer of the
Bank and UnionBanCal Corporation ("UNBC") and a Director on the Board of
Directors of UNBC (the "Board"), the Bank and various subsidiaries and
affiliates of the Bank and UNBC; and
WHEREAS, the parties wish to terminate and supersede the existing terms and
conditions of Mr. Hartnack's employment with the Bank; and
WHEREAS, the Bank desires to continue to secure the services of
Mr. Hartnack and Mr. Hartnack 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.
The Bank represents that it is fully authorized to enter into this
Agreement. Mr. Hartnack 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. Mr. Hartnack 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 Mr. Hartnack's service at the
request of the Bank's Chief Executive Officer, or with the concurrence of the
Bank's Chief Executive Officer, 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 the business of the
Bank, for example, Mr. Hartnack's service on the U.S. Region Board of MasterCard
International, Inc.
2. EMPLOYMENT AND DUTIES.
The Bank will continue to employ Mr. Hartnack as a Vice Chairman and,
during such employment, will continue to nominate him as a Director of UNBC.
Mr. Hartnack hereby accepts such employment with the Bank. Mr. Hartnack shall
devote his time, ability, attention, energy, knowledge and skill solely and
exclusively to performing all reasonable duties as Vice Chairman of the Bank as
assigned to him by the Bank's Chief Executive Officer or the Board.
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3. BASE SALARY.
In consideration for Mr. Hartnack's services to the Bank during the time
period in which this Agreement is effective, Mr. Hartnack is receiving a base
salary of Four Hundred Fifteen Thousand Dollars ($415,000.00) 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, the Board or any
other committee constituted by the Board for this purpose (as applicable, the
"Committee"). Annual base salary shall be competitive with the annual base
salaries for comparable executive positions at banks of similar size and focus,
as determined at the discretion of the Committee.
4. ADDITIONAL BENEFITS.
During his employment under this Agreement:
a. BONUS. Mr. Hartnack shall be entitled to participate in the Bank's
Senior Management Bonus Plan, or its successor, subject to the eligibility
requirements and other terms and conditions of such Plan and the determinations
of the administrator of such Plan. Mr. Hartnack's target bonus under the Senior
Management Bonus Plan shall be fifty percent (50%) of base salary, subject to
annual review and increases or decreases at the discretion of the Committee,
based on the median annual bonus targets for comparable executive positions at
banks of similar size and focus (as determined at the discretion of the
Committee).
b. LONG TERM INCENTIVES. Mr. Hartnack 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 Management Stock Option Plan, or its successor,
and the award of performance shares under the UNBC Performance Share Plan, or
its successor. Mr. Hartnack's target award shall be valued at one hundred
percent (100%) of base salary. Notwithstanding the preceding sentence,
determinations of the amount of any award to Mr. Hartnack shall be made at the
discretion of the Committee, subject to annual review and increases or
decreases, based on the median long-term 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. Mr. Hartnack 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. Subject to paragraph 6, Mr.
Hartnack shall be entitled to receive an overall pension benefit from the
Bank, calculated under the terms of the Union Bank of California Retirement
Plan (the "Retirement Plan"), without regard to the limits of Code
sections 401(a)(17) and 415, and crediting Mr. Hartnack with an additional
nine (9) years of "credited service." During the period represented by the
nine (9) year grant of past service credits, Mr. Hartnack participated in the
qualified and nonqualified pension plans of First National Bank of Chicago
(the "Chicago Plans"), and during his employment under this Agreement Mr.
Hartnack shall be a participant under the Bank's
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Supplemental Executive Retirement Plan (the "SERP"). As such, the portion of
Mr. Hartnack's overall pension benefit payable under this Agreement shall be
a net benefit (the "Net Benefit"). Such Net Benefit shall be an amount
determined as described in the first sentence of this subparagraph less
(i) the amount payable from the Retirement Plan and from the SERP, and
(ii) the "Revised Offset" annuity amount in Exhibit A, which represents the
actuarial equivalent of the $92,678.04 total lump sum distribution that
Mr. Hartnack received from the Chicago Plans (representing his entire
interest under such plans) on June 28, 1991. The Net Benefit payable under
this Agreement shall be determined as a Normal Retirement Benefit, an Early
Retirement Benefit or a Deferred Retirement Benefit, as applicable, within
the meaning of the SERP, employing the same offset methodology and all other
terms and conditions as described under the SERP. As such, the Net Benefit
shall be paid in the same form and at the same time as the benefit payable
under the SERP. The Net Benefit obligation of this subparagraph 4(d) shall
be an unfunded and unsecured obligation of the Bank, as to which Mr. Hartnack
shall have no rights other than those of a general creditor of the Bank.
e. INSURANCE AND WELFARE PLANS. Mr. Hartnack 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 dues and assessments, and other perquisites
as determined by the Committee for similarly situated executives.
g. BUSINESS EXPENSES. Mr. Hartnack 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 4(g) will be reimbursed only upon presentation by Mr. Hartnack
of such documentation in accordance with Bank policy and as may be reasonably
necessary to substantiate that all such expenses were incurred in the
performance of his duties.
h. VACATION AND SICK LEAVE. Mr. Hartnack 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 policy.
5. OUTSIDE ACTIVITIES AND NON-COMPETITION.
During the term of this Agreement, and subject to paragraph 1, Mr. Hartnack
shall devote his time, ability, attention, energy, knowledge and skill to the
business of the Bank. During the term of this Agreement, Mr. Hartnack 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
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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, Mr. Hartnack shall not engage in unfair competition with the Bank or
aid others in any unfair competition with the Bank, unfair competition having
the meaning ascribed in the "Competition and Business Promotion" section of
the Bank's April 1996 revision of the Business Standards of Conduct (except
that the object of the prohibition shall be read as the Bank rather than a
competitor). Following his employment with the Bank, Mr. Hartnack 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 1996 revision of the Business Standards of
Conduct.
6. TERMINATION OF EMPLOYMENT.
This Agreement shall terminate as follows:
a. BY DEATH. This Agreement shall be terminated upon the death of
Mr. Hartnack. The Bank's total liability to Mr. Hartnack in the event of
termination of Mr. Hartnack's employment under this subparagraph shall be
limited to the payment (on his behalf) of Mr. Hartnack's salary and benefits as
set forth in paragraphs 3 and 4 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, Mr. Hartnack 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 Mr. Hartnack in the event of termination of
Mr. Hartnack's employment under this subparagraph shall be limited to (i) the
payment of Mr. Hartnack's salary and benefits as set forth in paragraphs 3 and 4
of this Agreement through the effective date of termination. In calculating the
Net Benefit payable to Mr. Hartnack pursuant to subparagraph 4(d), Mr. Hartnack
will continue to accrue credited service in the manner described in Article VI
of the Retirement Plan (or a successor provision). Nothing in this paragraph 6
is intended to preclude Mr. Hartnack from exercising any rights he may have
under the Bank's Short Term Disability Plan or Long Term Disability Plan, in
accordance with the eligibility requirements and other terms and conditions of
those respective plans, or their respective successors.
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: Mr. Hartnack 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 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. The Bank's total
liability to Mr. Hartnack in the event of termination of Mr. Hartnack's
employment under this subparagraph shall be limited to the payment of
Mr. Hartnack's salary and benefits as set forth in paragraphs 3 and 4 of this
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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
Mr. Hartnack from the Bank's Chief Executive Officer. Mr. Hartnack hereby
agrees that the Bank may dismiss him under this subparagraph 6(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 Mr. Hartnack, whether made orally or contained in any
document, pertaining to Mr. Hartnack's relationship with the Bank. In the event
of termination under this subparagraph 6(d), and subject to the conditions set
forth herein, Mr. Hartnack shall be entitled to receive the payments described
in (i) and (ii) below.
(i) If Mr. Hartnack has not yet attained age 65 at the time of his
termination of employment, and provided Mr. Hartnack has, at the time of his
termination of employment, previously executed the "General and Special Release"
(attached hereto as Exhibit B), then in consideration for such Release, the Bank
will provide Mr. Hartnack 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 Mr. Hartnack's base salary at the time of his termination, plus a
prorated bonus amount each payroll period equal to the average of
Mr. Hartnack's annual bonus (excluding any amount that represents an
award of long term incentive by the Bank) for the three 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) payable to
participants at or above the level of Executive Vice 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 C; and
(C) Full and immediate vesting, upon Mr. Hartnack's termination
of employment, in the target award amount under his outstanding
grant(s) of performance shares under the UNBC Performance Share Plan,
and payment of such vested shares within 120 days following his
termination of employment (without giving effect to any deferral
election that would have applied had the shares become an earned
award), such payment to be made in cash equal to the number of vested
shares times the average month-end closing price of UNBC common stock
(as published in the Western Edition of the Wall Street Journal) for
the six months immediately preceding Mr. Hartnack's date of
termination of employment; and
(ii) The Bank will provide Mr. Hartnack with salary and benefits as
set forth in paragraphs 3 and 4 of this Agreement through the effective date of
termination, provided, in addition, that for purposes of determining the Net
Benefit under subparagraph 4(d), Mr. Hartnack shall be treated as eligible for
the "10-Year Early" retirement benefit if not so
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eligible at the time of his termination of employment.
A termination of this Agreement on account of Mr. Hartnack's disability shall be
governed by subparagraph 6(b) and not this subparagraph 6(d). In addition, in
the event Mr. Hartnack dies while receiving salary continuation benefits under
subparagraph 6(d)(i)(A) above, then Mr. Hartnack shall have the remaining salary
continuation, if any, paid to his Designated Beneficiary under Exhibit D
attached hereto.
e. BY MR. HARTNACK WITHOUT CAUSE. Mr. Hartnack reserves the right to
terminate this Agreement for any reason (other than the reason set forth in
subparagraph 6(f)) upon reasonable written notice to the Bank. The Bank's total
liability to Mr. Hartnack in the event of termination of Mr. Hartnack's
employment under this subparagraph shall be limited to the payment of
Mr. Hartnack's salary and benefits as set forth in paragraphs 3 and 4 of this
Agreement through the effective date of termination.
f. BY MR. HARTNACK FOR CAUSE. Subject to the further conditions next
described, Mr. Hartnack 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 Mr. Hartnack no longer serving in the
capacity or under the title of Vice Chairman of the Bank, the Bank's failure to
continue to nominate Mr. Hartnack as a Director of UNBC, or Mr. Hartnack's
position ceasing to be one directly reporting to the Bank's Chief Executive
Officer), a reduction in his annual base salary or a reduction in his
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). In order to elect to terminate this Agreement
pursuant to this subparagraph 6(f), Mr. Hartnack must submit the written notice
to the Bank within sixty (60) days of the reduction. Mr. Hartnack shall not be
entitled to elect to terminate this Agreement pursuant to this subparagraph 6(f)
if prior to Mr. Hartnack's termination date the Bank corrects the deficiency
upon which Mr. Hartnack's resignation is based. In the event that Mr. Hartnack
is entitled to and elects to terminate this Agreement pursuant to this
subparagraph 6(f), (i) he shall be entitled to receive salary and benefits as
set forth in paragraphs 3 and 4 of this Agreement through the effective date of
termination, including, if applicable, the early retirement enhanced actuarial
factors described in subparagraph 6(d)(ii), and (ii) if he is 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" (attached hereto as Exhibit B), then in consideration for such
Release, the Bank will provide Mr. Hartnack with the salary continuation and
benefits set forth in subparagraphs 6(d)(i)(A), (B) and (C). In the event Mr.
Hartnack dies while receiving salary continuation benefits described in
subparagraph 6(d)(i)(A) above, then Mr. Hartnack shall have the remaining salary
continuation, if any, paid to his Designated Beneficiary under Exhibit D
attached hereto.
g. RESIGNATION OF POSITIONS. Upon termination of employment for any
reason whatsoever, Mr. Hartnack shall be deemed to have resigned from all
offices and positions with the Bank, UNBC, and their subsidiaries. Mr. Hartnack
agrees that, in connection with his termination under this Agreement, he will
sign such written resignations as required by the Bank.
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7. PROHIBITION OF ASSIGNMENT.
This Agreement is personal to Mr. Hartnack and he may not assign or
delegate any of his rights or obligations hereunder without first obtaining the
written consent of the Bank.
8. UNBC OR BANK SUCCESSOR.
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 Mr. Hartnack's employment is transferred.
9. ARBITRATION.
Any controversy between the Bank, UNBC or their parent companies,
subsidiaries and affiliates and Mr. Hartnack or between any employee of the
Bank, UNBC or their parent companies, subsidiaries and affiliates and
Mr. Hartnack, including, but not limited to, any controversy arising out of
Mr. Hartnack's 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 B to this Agreement (the "General and
Special Release") or involving a claim of race, sex, religious, age, disability,
veteran status, sexual orientation or national origin discrimination, shall be
settled by arbitration in accordance with the then current employment dispute
resolution rules of the American Arbitration Association determined by the
Committee to most closely resemble the California Employment Dispute Resolution
Rules in effect on January 1, 1998, 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 Mr. Hartnack 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. Further, the Bank shall bear the cost of the arbitrator (including
the costs of establishing a facility for or otherwise administering the
arbitration). The location of the arbitration shall be in San Francisco,
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.
In the event of a breach by Mr. Hartnack of any of the covenants contained
in paragraph 5 of this Agreement, it is recognized that in addition to any other
remedy available to it, the Bank shall be entitled to institute or prosecute
proceedings in any court of competent jurisdiction, either in law or in equity,
to obtain damages for any breach of this Agreement or to
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sue for specific performance, or an injunction against performance of any
acts, or to seek any other available remedy.
This paragraph 9 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 Mr. Hartnack's employment with the Bank.
10. LIMITATION ON PAYMENTS.
a. BASIC RULE. In the event Mr. Hartnack 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, Mr. Hartnack shall receive
aggregate payments equal to the Reduced Amount, if such Reduced Amount would
result in net after-tax payments to Mr. Hartnack that are greater than the net
after-tax payments he would have received without regard to this paragraph. For
purposes of this paragraph 10, 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 10 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 Mr. Hartnack, and shall be binding on the
Bank and Mr. Hartnack. All fees and expenses of the Auditors shall be paid by
the Bank.
b. REDUCTIONS. If the amount of the aggregate payments to Mr. Hartnack
must be reduced under this paragraph 10, then Mr. Hartnack 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 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
Mr. Hartnack 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 Mr. Hartnack 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 Mr. Hartnack 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, Mr. Hartnack, together with interest at the applicable federal
rate specified in section 7872(f)(2) of the Code.
11. MODIFICATION.
Any modification of this Agreement will be effective only if it is in
writing and signed by the parties to be bound thereby.
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12. ENTIRE AGREEMENT.
This Agreement constitutes the entire agreement between the Bank and
Mr. Hartnack pertaining to the subject matter hereof, and supersedes all prior
or contemporaneous written or verbal agreements and understandings with
Mr. Hartnack in connection with the subject matter hereof.
13. GOVERNING LAW.
This Agreement and the rights and obligations hereunder shall be governed
by the laws 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.
14. SEVERABILITY.
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.
15. WAIVER.
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.
16. NOTICES.
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: Paul Fearer
Executive Vice President
Union Bank of California, N.A.
350 California Street
San Francisco, CA 94104
To Mr. Hartnack: Richard Hartnack
Vice Chairman
Union Bank of California, N.A.
445 South Figueroa Street
Los Angeles, CA 90051
or at such other addresses as either of said parties may from time to time in
writing appoint.
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17. 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.
18. WITHHOLDING TAXES.
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 _____________________________
Paul Fearer
Executive Vice President
Dated: _____________ _________________________________
Richard C. Hartnack
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EXHIBIT A
ANNUITY VALUE OF LUMP SUM
- - ------------------------------------------------------------
- - ------------------------------------------------------------
Age at Retirement Revised Offset
- - ------------------------------------------------------------
55 $12,814.53
- - ------------------------------------------------------------
56 13,968.45
- - ------------------------------------------------------------
57 15,251.92
- - ------------------------------------------------------------
58 16,683.19
- - ------------------------------------------------------------
59 18,283.58
- - ------------------------------------------------------------
60 20,078.20
- - ------------------------------------------------------------
61 22,096.74
- - ------------------------------------------------------------
62 24,374.38
- - ------------------------------------------------------------
63 26,952.93
- - ------------------------------------------------------------
64 29,882.30
- - ------------------------------------------------------------
65 33,222.28
- - ------------------------------------------------------------
- - ------------------------------------------------------------
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EXHIBIT B
GENERAL AND SPECIAL RELEASE
1. In return for the benefits provided for in subparagraphs 6(d)(i) or
6(f)(ii) of the Employment Agreement entered into as of January 1, 1998 (the
"Agreement"), the adequacy of which as consideration is hereby acknowledged,
Richard C. Hartnack (hereinafter, "Mr. Hartnack") 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, 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 California Fair Employment and
Housing Act and any other federal, state or local laws, arising out of or in any
way related to Mr. Hartnack's employment with the Bank or termination of that
employment. Mr. Hartnack 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 Mr. Hartnack operates as a complete bar and defense against any
and all current claims of any type that may be made by Mr. Hartnack against the
Bank, provided, however, that nothing in this release is intended to affect
Mr. Hartnack's 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. Mr. Hartnack 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 Mr. Hartnack
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 Mr. Hartnack 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. Mr. Hartnack 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. Mr. Hartnack understands that he is waiving
legal rights by signing this agreement.
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4. Mr. Hartnack acknowledges that he has been given at least twenty-one
(21) days within which to consider this Release. Mr. Hartnack 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
enforceable until the eighth (8th) day after its execution.
Dated: ________________ ______________________________
Richard C. Hartnack
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EXHIBIT D
UNION BANK OF CALIFORNIA, N.A.
BENEFICIARY DESIGNATION
UNDER EMPLOYMENT AGREEMENT
Name: Richard C. Hartnack
Social Security Number: ______-____-________
If I die while receiving salary continuation payments under subparagraph 6(d) or
6(f) of the Employment Agreement entered into as of January 1, 1998, 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]:
/ /1 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).
/ /2 To my estate.
/ /3 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.
___________________, 199__ __________________________________
[Date] [Signature]
Date of receipt:_____________, 199__.
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