Exhibit 10.19
Western Alliance Bancorporation
Annual 2011 Bonus Plan
Parent and All Affiliate Banks
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
Bancorporation (WAL) will meet and exceed its goals.
ELIGIBILITY: Team members (except those on special incentive plans, such as; RE,
WAL Equipment Leasing, Shine Investment Services, Alliance Association Financial
Services, Treasury Management and several individual plans) who are employed by
WAL as of January 1st of the Plan Year. Bonuses for team members hired after
January 1st but on or before September 30th of a Plan Year will be prorated.
Team members hired after September 30th may be eligible the following Plan Year.
EFFECTIVE DATE: January 1, 2011. This Plan supersedes all others before it and
for 2011 there will be one plan for the Company.
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 Compensation Committee will administer and approve the
Plan annually. The day to day details of the Plan will be monitored by an
internal committee made up of WAL Chief Executive Officer, President/COO, 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) Organic Deposit Growth, 2) Organic Loan
Growth, 3) Net Income, 4) Credit Quality, 5) Pre-tax and Pre-Credit, and 6)
QUALITY Control (Regulatory exams and Internal Audits).
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.

  A.  
Organic Deposit Performance is weighted 15%

               This portion of the bonus will be calculated based on WAL
performance in Organic Deposit Growth.
Organic Deposit Growth

  1.  
As soon as possible after the end of the Plan Year, the Finance Department will
measure the Actual Organic Deposit Growth results for WAL. Adjustments may be
made to these calculations to account for windfalls, etc.
    2.  
Following are the definitions/calculations on which this portion of the bonus
will be based:

  a.  
A calculation will be made for the WAL Growth in Organic Deposits (15% of
target).
    b.  
Organic Deposits will be calculated on organic growth and will not include
increases in deposits acquired by acquisition.

 

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  c.  
Calculation: The percent of Target bonus paid for Organic Deposit Growth will be
calculated based on the following schedule:

                CHART FOR ORGANIC DEPOSIT GROWTH 15% OF TARGET     WAL
Performance Organic           Deposit Growth     Percent of Target Paid (Organic
Deposits)    
Less than <3%
    No Bonus paid    
Between 3% - 6%
    75% to 100%     
Between 6% - 9%
    100% to 150%     

  3.  
In order to receive more than 100% of the Organic Deposit growth portion of the
bonus:

  a.  
WAL must achieve a growth of more than 6% in Organic Deposits to pay more than
100% for the goal being measured, and
    b.  
Participant must meet individual goals in this respective area.

  A.  
Organic Loan Growth is weighted 15%

                    This portion of the bonus will be calculated based on WAL
performance in Organic Loan Growth.
 Loans Growth

  1.  
As soon as possible after the end of the Plan Year, the Finance Department will
measure the Actual Loan results for WAL. Adjustments may be made to these
calculations to account for windfalls, etc.
    2.  
Following are the definitions/calculations on which this portion of the bonus
will be based:

  a.  
A calculation will be made for WAL Growth in Total Loans (15% of target).
    b.  
Loans will be calculated on organic growth and will not include increases in
loans acquired by acquisition.
    c.  
Calculation: The percent of Target bonus paid for Loan will each be calculated
based on the following schedule:

                CHART FOR ORGANIC LOAN GROWTH 15% OF TARGET     WAL Performance
Organic           Loan Growth     Percent of Target Paid (Organic Loans)    
Less than <3%
    No Bonus paid    
Between 3% - 6%
    75% to 100%     
Between 6% - 9%
    100% to 150%     

  3.  
In order to receive more than 100% of the Loan growth portion of the bonus:

  a.  
WAL must achieve a growth of more than 6% in Loans to pay more than 100% for the
goal being measured, and
    b.  
Participant must meet individual goals in this respective area.

  B.  
Net Income Growth is weighted 20%

This portion of the bonus will be calculated on Net Income

                CHART FOR NET INCOME WEIGHTED 20% OF TARGET     WAL Net Income
Growth           Performance     Percent of Target Bonus Paid Net Income    
Less than <$18 million
    No Bonus paid    
Between $18 -$21
    75% to 100%     
Between $21 -$30
    100% to 150%     

  C.  
Pre-Tax, Pre-Credit Earnings is weighted 20%

This portion of the bonus will be calculated on Pre-Tax, Pre-Credit

 

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                CHART FOR ROAA GROWTH 20% OF TARGET     WAL Performance Pre Pre
Earnings     Percent of Target Bonus Paid    
Less than <$100 million
    No Bonus paid    
Between $100 - $110
    75% to 100%    
Between $110 – $120
    100% to 150%    

  D.  
Credit
Quality is weighted 20%

               This portion of the bonus will be calculated on Net Charge Offs
(weighted 10%) and NPA’s (weighted10%)

                WAL Credit Quality Performance     Percent of Target Bonus Paid
   
Net Charge Offs
         
>1.5%
    No Bonus paid    
1.5% -1.3%
    75% to 100%    
1.3% - 1.1%
         

             
NPA’s
         
>3.0%
    No Bonus paid    
3.0% - 2.5%
    75% to 100%    
2.5% - 2.0%
    100% to 150%    

  E.  
Quality Control is weighted 10%

  1.  
Quality control refers to the effectiveness of the Corporation’s regulatory
examinations and internal audits.
    2.  
Quality Control will be measured in the following two areas:

  a.  
All Regulatory Examinations (5%)
  b.  
Internal Audits (5%)

  3.  
The maximum pay out on this quality control is 100%
    4.  
Quality Control performance will be measured and assessed by the WAL Audit
Committee

  F.  
Other Calculation Provisions

  1.  
All participants below the level of Vice President will be paid out according to
the bonus formula
    2.  
All Vice Presidents and above (excluding members of the Executive Management
Committee) will be evaluated at the end of the plan year. Based upon these
evaluations, participants final bonus payout will range from 75% to 125% of
overall payout.
    3.  
Each officer will be evaluated in the following areas:

  a.  
Ability to Work within a Team setting
    b.  
Initiative/Proactive
    c.  
Customer Service Focus
    d.  
Commitment to Quality
    e.  
Planning/Organization
    f.  
Leadership

  i.  
Strategic Thinking
    ii.  
Mentoring

 

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  iii.  
Communication
    iv.  
Development

  4.  
Executive Management Committee members cannot receive more than 33% of their
Target bonuses unless WAL achieves positive net income for fiscal year 2011.
    5.  
Participants must meet individual loan and organic deposit production goals, if
assigned, or their total bonus may be reduced or eliminated.
    6.  
A participant’s bonus may be reduced or eliminated if, in the discretion of
Management, i) the department’s loan review and/or audits are rated below
satisfactory and/or not adhering to safety, soundness, and approved operational
procedures, ii) any participant, their branch or department earns a rating of
less than “Satisfactory,” iii) the department’s credit underwriting and/or
portfolio management practices are rated below “Satisfactory” and/or not
adhering to safety and soundness, or iv) the participant, their branch or
department has not contributed adequately to the financial results attributed to
them.

  G.  
Other Administrative Provisions

  1.  
This is a discretionary bonus plan and, in order to receive payment of any bonus
under this Plan, the participant must be employed by WAL at the time payment is
made, which will be no later than March 15th.
    2.  
Designation as a participant in the Plan does not create a contract of
employment for any specified time, nor shall such act to alter or amend WAL’s
“at-will” policy of employment.
    3.  
If any participant’s performance is rated as falling below job expectations or
as less than satisfactory at any time during the Plan Year, or if the
participant is subject to any written disciplinary action, the bonus payment
will be reduced or eliminated.
    4.  
Participants who transfer during the year will participate in the Plan
applicable to the department they are in at year-end. If extenuating
circumstances arise, exceptions to this policy will be considered on a case by
case basis.
    5.  
A change in officer title occurring during the year will not change the target
bonus percentage.
    6.  
Awards will be paid through the normal payroll process to participants. All
awards will be subject to applicable taxes. Awards do not constitute commissions
or additional wages, and participants have no vested interests in the benefits
of the Plan, except as expressly provided for herein.
    7.  
Awards under this Plan will be used in calculating covered earnings for benefit
purposes for the 401(k) and Life Insurance Plans but not for Long Term
Disability Insurance.
    8.  
Timely and accurate completion of all business plans, reports, budgets and other
planning exercises is required for payment under the Plan.
    9.  
Acknowledgment from the HR Department that offices and officers have conformed
to bank policy in timeliness of annual reviews, controllable turnover, and all
other areas of HR administration is required for payment under this Plan.
    10.  
Performance measurements and statistics will be based on calculations completed
by the Finance Division of WAL. Any questions about the results or the bonus
calculations must be submitted to the Plan Administrator within 30 days after
the calculations have been completed and published, after which time no
inquiries will be considered.
    11.  
Management retains the right in its sole discretion to adjust bonuses to reflect
“windfall” changes (i.e., transfer of unusually large accounts or loans between
offices, etc.).
    12.  
This Plan is governed and interpreted by the Plan Administrator, whose decisions
shall be final. This is a discretionary program and the Plan Administrator or
the Board of Directors of WAL reserves the right to terminate or alter this
bonus program at any time.
    13.  
Participants are eligible to participate in only one annual bonus plan (could
also be paid out quarterly), and Management has the discretion to assign any
team member to the particular plan it deems appropriate.

 

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  14.  
The intent of WAL Management is to fairly reward team members for adding value
to the Company. If any adjustments need to be made to allow this Plan to
accomplish its purpose, the Incentive Compensation Committee in its sole
discretion can make those adjustments.

Sample Calculation:

1.  
WAL Organic Deposit Growth Performance is weighted 15%

             
Organic Deposit Growth Performance
    WAL    
Deposit Growth Achieved
    3%    
% of Deposit Target Bonus Paid
    75%    

  See table on page 2

2.  
WAL Organic Loan Growth Performance is weighted 15%

             
Organic Loan Growth
    WAL    
Loan Growth Achieved
    6%    
Loan Growth Target Paid
    100%    

  See table page 2

3.  
WAL Net Income Growth Performance is weighted 20%

             
Net Income Growth Performance
    WAL    
Net Income Achieved
    $21 million    
Net Income Growth Target Paid
    100%    

  See table page 3

4.  
WAL Pre-Tax, Pre-Credit Earnings Growth Performance is weighted 20%

             
Pre Pre Earnings Performance
    WAL    
Pre Pre Earnings
    $110 million    
Pre Pre Earnings Target Paid
    100%    

  See table page 3

5.  
WAL Credit Quality Performance is weighted 20%

             
Credit Quality Performance 10%
    WAL    
Net Charge Offs achieved
    1.3%    
% of Goal Paid
    100%    

             
Credit Quality Performance
    WAL    
NPA percentage achieved
    3%    
% NPA Goal Paid
    75%    

  See table page 3

6.  
WAL Quality Control factors are weighted 10%

  •  
Regulatory Examines (5%) WAL Audit Committee determined PASS
    •  
Internal Audits (5%) WAL Audit Committee determined PASS

 

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Passed at the 100% level for example purposes
Example Paid under WAL Annual Bonus

                                                  Participant has a base salary
of $60,000   Target Bonus of 8%   Target Bonus - $4,800.00  
 
        Deposit   Loan     Net Income     P P Earn     Net Charge Off     NPA  
  Quality    
$4,800     
    $4,800       $4,800       $4,800       $4,800       $4,800       $4,800  
X 15%     
    X 15%       X 20%       X 20%       X 10%       X 10%       X 10%    
$720     
    $720       $960       $960       $480       $480       $480  
X 75%     
    X100%       X100%       X100%       X100%       X 75%       X100%    
$540     
    $720       $960       $960       $480       $360       $480  

Total Payout is $540 + $720 + $960 + $960 + $480 + $360 + $480 = $4,500