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Western Alliance Bancorp
WAL Parent
Annual Bonus Plan 2009
Objective: The purpose of this Annual Bonus Plan is to
provide incentives and rewards for superior performance in order to
attract and retain highly qualified team members and to maximize
financial performance so that Western Alliance Bancorp
(WAL) will meet and exceed its goals.
Eligibility: Selected team members who are employed by WAL as
of January 1 st of
the Plan Year. Bonuses for team members hired after January
1 st
but on or before September 30
th of a Plan Year will be prorated. Team members
hired after September 30 th may be eligible the following Plan
Year.
Effective
Date: January 1,
2009. This Plan supersedes all others before it.
Frequency of
Awards : Awards will be
paid annually within 90 days after the end of the Plan Year.
Participants must be employed at the payment date to receive any
bonus compensation under this Plan.
Plan
Administrator: WAL’s Incentive Compensation Committee
will administer the Plan. This Committee is made up of WAL’s
Chief Executive Officer, Chief Financial Officer, and Chief
Administrative Officer.
How the Plan
Works: Subject to the
terms of the Plan, bonus calculations will be based on the
following factors: 1) WAL’s EPS growth, 2) Organic Deposit
growth, and 3) QUALITY control (Regulatory exams, Internal Audits,
Credit Quality). The focus on growing and increasing deposits
will allow the Bank to continue making loans.
A Target bonus
percentage expressed as a percent of Base Salary will be
established for each Participant. A payout at the maximum level
requires outstanding performance for the year in all components of
the Plan.
Base Salary is
defined as the Participant’s actual salary earned for the
year which includes pay for regular hours worked plus paid holiday,
sick, and vacation hours; earnings received while on a Leave of
Absence are not included in this calculation.
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A.
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WAL’s EPS Performance is
weighted 35% at the Parent level
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This portion of the Plan measures
the Corporations performance in EPS.
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Adjustments maybe made to this
calculation to account for miscellaneous gains or losses. For
example, restructuring charges will be excluded and allocations
will be normalized. The Incentive Compensation Committee may
approve other adjustments.
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1.
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As
soon as possible after the end of the Plan Year, the Finance
Division will calculate WAL’s EPS.
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2.
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EPS
will be calculated including acquisitions.
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3.
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The
WAL EPS portion of the bonus will be calculated based on hitting
the following EPS targets listed below:
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January 1,
2009 (as approved by the WAL Compensation Committee January 19,
2009)
Same targets
for all affiliates
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Growth in
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Percent of Target
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WAL EPS
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Bonus Paid
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Performance
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(WAL Portion)
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No Bonus paid
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50% to 75%
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75% to 100%
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100% to 125%
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125% to 150%
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B.
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Organic Deposit Performance is
weighted 35%
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This portion of the bonus will be
calculated based on Bank performance in Organic Deposit
Growth.
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Senior Management will agree on
final budget projections that will be translated into financial
performance goals.
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Organic Deposit
Growth
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1.
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In
setting the Budget for each Bank, Organic Deposit Growth Goals will
be established.
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2.
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As
soon as possible after the end of the Plan Year, the Finance
Department will measure the Actual Organic Deposit Growth results
for the Bank. Adjustments may be made to these calculations to
account for staff transfers, windfalls, etc.
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3.
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Following are the
definitions/calculations on which this portion of the bonus will be
based:
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a.
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A
calculation will be made for the Bank Growth in Organic Deposits
(35% of target).
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b.
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Calculation: The percent of Target
bonus paid for Organic Depoist Growth will each be calculated based
on the following schedule:
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c.
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Organic Deposits will be calculated
on organic growth and will not include increases in deposits
acquired by acquisition.
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Page 2
Chart for
Organic Deposit Growth 35% of target
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Bank Performance
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Percent of Target
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Organic Deposit
Growth
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Paid
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WAL Parent
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(Organic Deposits)
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No Bonus paid
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50% to 75%
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75% to 100%
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100% to 125%
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125% to 150%
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4.
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In
order to receive more than 100% of the Organic Deposit growth
portion of the bonus:
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a.
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Bank must achieve a growth of at
least $488MM+ in Organic Deposits to pay more than 100% for
the goal being measured, and
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b.
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Participant must meet individual
goals in this respective area.
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C.
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Quality Control is weighted
30%
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1.
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Quality control refers to the
effectiveness of the Corporation’s regulatory examinations,
internal audits and credit quality.
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