Exhibit 10.22

 

2000 CITY NATIONAL BANK
EXECUTIVE DEFERRED COMPENSATION PLAN

 

(Amended and Restated for Plan Years 2004/05 and Later

 

Effective on January 1, 2009)

 

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2000 City National Bank
Executive Deferred Compensation Plan

 

(Amended and Restated for Plan Years 2004/05 and Later

 

Effective on January 1, 2009)

 

TABLE OF CONTENTS

 

 

 

Page

 

 

 

ARTICLE I

 

 

 

TITLE AND DEFINITIONS

 

 

 

1.1

Title

1

1.2

Definitions

1

 

 

 

ARTICLE II

 

 

 

PARTICIPATION

 

 

 

2.1

Participation

5

 

 

 

ARTICLE III

 

 

 

DEFERRAL ELECTIONS

 

 

 

3.1

Elections to Defer Compensation

6

3.2

Investment Elections

9

 

 

 

ARTICLE IV

 

 

 

ACCOUNTS

 

 

 

4.1

Deferral Account

12

4.2

Rollovers

13

4.3

Profit Sharing Make-Up Contributions

13

 

 

 

ARTICLE V

 

 

 

VESTING

 

 

 

5.1

Deferral Account

15

 

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5.2

Profit Sharing Make-Up Contributions

15

 

 

 

ARTICLE VI

 

 

 

DISTRIBUTIONS

 

 

 

6.1

Distribution of Deferred Compensation

16

6.2

Nonscheduled In-Service Withdrawals

17

6.3

Hardship Withdrawals

17

6.4

Inability to Locate Participant

17

6.5

Death Benefit for Certain Participants

18

 

 

 

ARTICLE VII

 

 

 

ADMINISTRATION

 

 

 

7.1

Committee Action

19

7.2

Powers and Duties of the Committee

19

7.3

Construction and Interpretation

19

7.4

Information

20

7.5

Compensation, Expenses and Indemnity

20

7.6

Quarterly Statements

20

7.7

Claims Procedure

20

 

 

 

ARTICLE VIII

 

 

 

MISCELLANEOUS

 

 

 

8.1

Unsecured General Creditor

22

8.2

Restriction Against Assignment

22

8.3

Withholding

22

8.4

Amendment, Modification, Suspension or Termination

22

8.5

Governing Law

23

8.6

Receipt or Release

23

8.7

Payments on Behalf of Persons Under Incapacity

23

8.8

Headings, etc. Not Part of Agreement

23

8.9

Section 409A of the Code

23

8.10

Qualified Domestic Relations Orders

24

 

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2000 City National Bank
Executive Deferred Compensation Plan

 

(Amended and Restated for Plan Years 2004/05 and Later

Effective on January 1, 2009)

 

This 2000 City National Bank Executive Deferred Compensation Plan (the “Plan”),
established by City National Bank effective as of January 1, 2000, to provide a
tax-deferred capital accumulation opportunity to a select group of management
and highly compensated employees through deferral of salary, bonuses and/or
commissions, and subsequently amended on several occasions, is hereby amended
and restated for Plan Years 2004/05 and later effective on January 1, 2009. The
principal purpose of this amendment and restatement is to bring the Plan into
compliance with Section 409A of the Code and the Treasury Regulations issued
thereunder.  All amounts which were deferred and vested under this Plan on
December 31, 2004, together with earnings on such amounts (collectively
“Grandfathered Amounts”), are intended to be grandfathered under Section 409A of
the Code. The Grandfathered Amounts shall not be subject to the terms of this
amendment and restatement, but rather to the terms of the Plan as in effect
immediately prior to January 1, 2009.  No prior amendments to the Plan
subsequent to October 3, 2004 provided any new material benefits or rights or
any material enhancement of any existing benefits or rights under the Plan with
respect to the Grandfathered Amounts.

 

ARTICLE I
TITLE AND DEFINITIONS

 

1.1                               Title.

 

This Plan shall be known as the 2000 City National Bank Executive Deferred
Compensation Plan.

 

1.2                               Definitions.

 

Whenever the following words and phrases are used in this Plan, with the first
letter capitalized, they shall have the meanings specified below.

 

“Account” shall mean a Participant’s Deferral Account.

 

“Affiliate” shall mean (a) each corporation which is a member of a controlled
group of corporations (within the meaning of Section 414(b) of the Code,
substituting the language “at least 20 percent” for “at least 80 percent” each
place it appears in Section 1563(a)(1), (2) and (3) of the Code) of which City
National Bank is a component member and (b) each entity (whether or not
incorporated) which is under common control with City National Bank, as such
common control is defined in Section 414(c) of the Code and the Treasury
Regulations issued thereunder, substituting the language “at least 20 percent”
for “at least 80 percent” each place it appears in Section 1.414(c)-2 of the
Treasury Regulations.

 

“Bank” shall mean City National Bank (or any successor corporation) and its
Affiliates.

 

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“Beneficiary” or “Beneficiaries” shall mean the person or persons last
designated in writing by a Participant in accordance with procedures established
by the Committee to receive the benefits specified hereunder (other than those
benefits set forth in Section 6.5) in the event of the Participant’s death.  No
beneficiary designation shall become effective until it is filed with the Bank
or its agent.  If there is no Beneficiary designation in effect, or if there is
no surviving designated Beneficiary, then the Beneficiary or Beneficiaries shall
be, in order of priority: (a) the Participant’s surviving spouse, (b) if the
Participant is not survived by a spouse, the revocable living trust established
by the Participant during his or her lifetime, (c) the Participant’s children,
per stirpes; or (d) the Participant’s estate.  The filing of a new beneficiary
designation will cancel all beneficiary designations previously filed.  Any
finalized divorce of a Participant subsequent to the date of filing of a
beneficiary designation shall revoke such designation unless the previous spouse
was not designated as the Beneficiary.  In the event any amount is payable under
the Plan to a minor, payment shall not be made to the minor, but instead shall
be paid (i) to that person’s living parent(s) to act as custodian, (ii) if that
person’s parents are then divorced, and one parent is the sole custodial parent,
to such custodial parent, or (iii) if no parent of that person is then living,
to a custodian selected by the Committee to hold the funds for the minor under
the Uniform Transfers or Gifts to Minors Act in effect in the jurisdiction in
which the minor resides.  If no parent is living and the Committee decides not
to select another custodian to hold the funds for the minor, then payment shall
be made to the duly appointed and currently acting guardian of the estate for
the minor or, if no guardian of the estate for the minor is duly appointed and
currently acting within 60 days after the date the amount becomes payable,
payment shall be deposited with the court having jurisdiction over the estate of
the minor.

 

“Board of Directors” shall mean the board of directors of the Bank.

 

“Bonus” shall mean any annual bonus payable to a Participant under any formal
annual cash incentive compensation program maintained by the Bank in addition to
the Participant’s Salary.

 

“CNC Profit Sharing Plan” shall mean the City National Corporation Profit
Sharing Plan, as amended from time to time.

 

“CNC Stock” shall mean shares of City National Corporation Common Stock.

 

“Code” shall mean the Internal Revenue Code of 1986, as amended.

 

“Commissions” shall mean any commissions payable to a Participant.

 

“Committee” shall mean the Bank’s Benefits Committee.

 

“Compensation” shall mean the Salary, Bonus and/or Commissions that the
Participant is entitled to for services rendered to the Bank.

 

“Corporation” or “CNC” shall mean City National Corporation.

 

“Deferral Account” shall mean the bookkeeping account maintained by the
Committee for each Participant that is credited with amounts equal to (a) the
portion of the Participant’s Salary that he or she elects to defer, (b) the
portion of the Participant’s Bonus that he or she

 

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elects to defer, (c) the portion of the Participant’s Commissions that he or she
elects to defer, (d) the Participant’s Rollover Amount, if any, (e) the Profit
Sharing Make-Up Contributions made on behalf of the Participant, and
(f) earnings or losses pursuant to Section 4.1.

 

“Disability” shall mean an incapacity which has rendered the Participant
eligible to commence receiving benefits under the Bank’s long-term disability
plan and which constitutes a “disability” under Section 1.409A-3(i)(4) of the
Treasury Regulations.

 

“Earnings Rate” shall mean, for each Fund, an amount equal to the net rate of
gain or loss on the assets of such Fund during each business day.

 

“Eligible Employee” shall mean each officer of the Bank at the Senior Vice
President level or above that is regularly scheduled to work thirty (30) or more
hours per week or any other member of a select group of management and highly
compensated employees of the Bank or its Affiliates that the Committee
designates; provided, however, that no individual shall be an Eligible Employee
until the first day of the calendar month coinciding with or following the date
on which the individual first became such an officer or a member of such group. 
Notwithstanding the foregoing, no employee of any Affiliate shall be an Eligible
Employee unless such Affiliate has elected to participate in the Plan, and such
participation shall be subject to approval by the Committee.

 

“Fund” or “Funds” shall mean one or more of the investment funds or portfolios
selected by the Committee pursuant to Section 3.2(b).

 

“Grandfathered Amounts” shall mean all amounts which were deferred and vested
under this Plan on December 31, 2004, together with earnings on such amounts.

 

“Initial Election Period” for an Eligible Employee shall mean the thirty-day
period beginning on the date on which an individual first becomes an Eligible
Employee.

 

“Participant” shall mean (a) any Eligible Employee who elects to defer
Compensation in accordance with Section 3.1 and complies with the requirements
of Section 2.1 and (b) any individual who is credited with a Rollover Amount
pursuant to Section 4.2; and such Eligible Employee or individual shall remain a
Participant until all amounts credited to his or her Plan Year Subaccounts under
the Plan have been distributed or forfeited.

 

“Payment Eligibility Date” shall mean the date elected by the Participant
pursuant to Section 3.1(h).

 

“Plan” shall mean the 2000 City National Bank Executive Deferred Compensation
Plan set forth herein, now in effect, or as amended from time to time.

 

“Plan Year” shall mean the 12 consecutive month period beginning on January 1
and ending the following December 31.

 

“Plan Year Subaccounts” shall mean subaccounts of a Participant’s Deferral
Account established to separately account for Compensation deferred (and
earnings or losses thereon) for each Plan Year in which a Participant
participates in the Plan and for any Rollover Amounts.

 

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“Prior Plan” shall mean the City National Bank Executive Deferred Compensation
Plan.

 

“Profit Sharing Make-Up Contribution” shall mean an employer contribution made
in accordance with Section 4.3.

 

“Rollover Amount” shall mean the amount determined in accordance with
Section 4.2.

 

“Salary” shall mean the Participant’s base salary.

 

“Separation from Service” shall mean a “separation from service” within the
meaning of Section 409A of the Code, as determined by the Committee in
accordance with Section 1.409A-1(h) of the Treasury Regulations.  For purposes
of determining whether a Separation from Service has occurred, a Participant
shall be considered to have separated from service as an employee when the facts
and circumstances indicate that the Participant and the Bank reasonably
anticipate that either (i) no further services will be performed for the Bank
(including any Affiliates) after a certain date, or (ii) that the level of bona
fide services the Participant will perform for the Bank (including any
Affiliates) after such date (whether as an employee or as an independent
contractor) will permanently decrease to no more than 20% of the average level
of bona fide services performed by such Participant (whether as an employee or
an independent contractor) over the immediately preceding 36-month period (or
the full period of services to the Bank if the Participant has been providing
services to the Bank less than 36 months).

 

4

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ARTICLE II

PARTICIPATION

 

2.1                               Participation.

 

(a) Generally.  An Eligible Employee shall become a Participant in the Plan by
(i) electing to defer Compensation in accordance with Section 3.1, (ii) if
required by the Committee, filing a life insurance application form along with
his or her deferral election form, and (iii) satisfying any medical underwriting
requirement established by the Committee.

 

(b) Participants with Split-Dollar Life Insurance Agreements.  Notwithstanding
the foregoing, unless the Committee provides otherwise, an Eligible Employee who
has entered into a Split-Dollar Life Insurance Agreement with the Corporation
must execute an “Agreement for Transfer of Policy and Termination of
Split-Dollar Life Insurance Agreement” in order to defer Compensation under this
Plan.  Notwithstanding anything contained herein to the contrary, (i) if an
Eligible Employee is allowed to defer Compensation under this Plan without
executing an “Agreement for Transfer of Policy and Termination of Split-Dollar
Life Insurance Agreement” (a “Policy Transfer Agreement”), then no portion of
such Participant’s account balance under the Prior Plan shall be transferred to
his or her Account under this Plan and (ii) if an Eligible Employee is allowed
to defer Compensation under this Plan prior to executing a Policy Transfer
Agreement, then no portion of such Participant’s account balance under the Prior
Plan shall be transferred to his or her Account under this Plan until such
Participant executes a Policy Transfer Agreement.

 

(c) Duration of Participation.  Any deferral election of a Participant who
ceases to be an Eligible Employee shall terminate effective as of December 31 of
the Plan Year in which such cessation occurs (but shall apply to any
Compensation earned during such Plan Year that becomes payable following the end
of such Plan Year).

 

5

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ARTICLE III

DEFERRAL ELECTIONS

 

3.1                               Elections to Defer Compensation.

 

(a) Initial Election Period.  Subject to Section 2.1, each Eligible Employee may
elect to defer Compensation by filing with the Bank or its agent an election
that conforms to the requirements of this Section 3.1, using a form, method, or
process approved by the Committee, no later than the last day of his or her
Initial Election Period.  Such election shall be irrevocable as of the date it
is filed with the Bank or its agent. An Eligible Employee who terminates
employment and who is subsequently reemployed by the Bank, or who ceases to be
an Eligible Employee and is subsequently reinstated as an Eligible Employee as a
result of changes in the employee’s duties or title or otherwise, shall not be
entitled to make an election pursuant to this Section 3.1(a) as a result of such
reemployment or reinstatement.

 

(b) General Rule.  The amount of Compensation which an Eligible Employee may
elect to defer is as follows, subject to the limitations in Section 3.1(d), if
applicable:

 

(i)                                     Any percentage or dollar amount of
Salary up to 85%;

 

(ii)                                  Any percentage or dollar amount of Bonus
up to 100%; and/or

 

(iii)                               Any percentage or dollar amount of
Commissions up to 100%;

 

provided, however, that no election shall be effective to reduce the
Compensation paid to an Eligible Employee for a calendar year to an amount which
is less than the amount that the Bank is required to withhold from such Eligible
Employee’s Compensation for such calendar year for purposes of federal, state
and local (if any) income tax and employment tax (including Federal Insurance
Contributions Act (FICA) tax withholding), as permitted by
Section 1.409A-3(j)(4)(vi) of the Treasury Regulations.

 

(c) Minimum Deferrals.  [Intentionally Omitted.]

 

(d) Effect of Initial Election.  The amount of Salary, Commissions and Bonus
deferred pursuant to an election made during the Initial Election Period shall
not exceed (i) with respect to Salary and/or Commissions, the amount of Salary
and/or Commissions earned during the first full pay period beginning after the
date on which the Participant’s election to defer Compensation is filed with the
Bank or its agent and each subsequent pay period beginning in the same Plan
Year; and (ii) with respect to Bonus, a portion of the Bonus paid with respect
to services performed in the Plan Year for which the election is made determined
by multiplying the amount of such Bonus by the ratio of (A) the number of
calendar days remaining in the period to which the Bonus relates after the date
on which the Participant’s election is filed with the Bank or its agent over
(B) the total number of calendar days the Participant is employed by the Bank
during the period to which the Bonus relates.

 

(e) Elections other than Elections during the Initial Election Period.  Subject
to the requirements of Section 2.1, any Eligible Employee may participate for
any Plan Year by filing  an election, using a form, method, or process approved
by the Committee, to defer Compensation

 

6

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as described in paragraph (b) above.  An election to defer Compensation for a
Plan Year must be filed on or before December 1 of the preceding Plan Year, or
such other date as the Bank establishes, which date shall be no later than
December 31 of the preceding Plan Year, and will be effective for Salary,
Commissions and/or Bonus earned during pay periods beginning on or after
January 1 of the Plan Year for which the election applies.

 

(f) Duration of Deferral Elections.  Any election made under this Plan to defer
Compensation shall apply only to Compensation payable with respect to services
performed during the Plan Year for which the election is made.  For each
subsequent Plan Year, a Participant who remains an Eligible Employee may make a
new election, subject to the limitations set forth in this Section 3.1, to defer
a percentage of his or her Compensation.

 

(g) In-Service Distributions.  At the time of making an election to defer
Compensation for a Plan Year pursuant to this Section 3.1, a Participant may
elect (using a form, method, or process approved by the Committee) to receive an
in-service distribution of the amount deferred under such election, together
with earnings or losses credited with respect to such amounts pursuant to
Article IV, in a lump sum payment, or in annual installments over 2, 3, 4, or 5
years, paid or commencing within 90 days following any January 1 that occurs
after the second anniversary of the last day of the Plan Year in which the
amount deferred was earned.  In addition, each Participant who has a Rollover
Amount credited to his or her Account pursuant to Section 4.2 shall be permitted
to elect, on or before December 31, 1999, to receive an in-service distribution
of such Rollover Amount, together with earnings or losses, within 90 days
following January 1 of 2003 or any later year.  A Participant who has timely
elected an in-service distribution in accordance with this Section 3.1(g) may
subsequently elect to defer the year of any such in-service distribution or to
change the form of an in-service distribution by filing an election with the
Bank or its agent, using a form, method, or process approved by the Committee,
at least one year prior to the first day of the previously elected in-service
distribution year; provided that pursuant to such election, the in-service
distribution is deferred to the 90-day period following any subsequent January 1
that is at least five years from the prior scheduled distribution date.  The
election to defer the year of an in-service distribution may be made no more
than twice.  If a Participant elects an in-service distribution but fails to
specify the form of payment, the Participant will be deemed to have elected a
lump sum payment.  If a Participant fails to make a distribution election under
this Section 3.1(g) for a Plan Year, or fails to specify the year in which the
in-service distribution shall be made, the Compensation deferred for that Plan
Year shall be distributed as set forth in Section 6.1(b).

 

(h) Elections for Alternative Time and Form of Distribution.  At the time of
making an election to defer Compensation for a Plan Year pursuant to this
Section 3.1, a Participant may elect (using a form, method, or process approved
by the Committee) an alternative time or form of benefit for distribution of the
Compensation deferred for that Plan Year pursuant to Section 6.1(b), as follows:

 

(i)            The Participant may elect one of the following Payment
Eligibility Dates:

 

(A)          The first day of the first calendar quarter following the calendar
quarter in which the Participant has a Separation from Service with the Bank,
incurs a Disability or dies;

 

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(B)           January 1 of the first calendar year following the calendar year
in which the Participant has a Separation from Service with the Bank, incurs a
Disability or dies; or

 

(C)           January 1 of any one of the second, third, fourth, fifth, or sixth
calendar years following the calendar year in which the Participant has a
Separation from Service with the Bank, incurs a Disability or dies (which may
otherwise be described in any enrollment forms or materials as the January that
is 1-5 years following termination of employment, or 1-5 years following the
anniversary of termination of employment).

 

(ii)           The Participant may elect one of the following forms of benefit:

 

(A)          A lump sum payment; or

 

(B)           Payment in 20, 40, or 60 substantially equal quarterly
installments.

 

Subject to the provisions of Section 6.1(b), this election will apply to the
Compensation deferred for such Plan Year if (x) the Participant does not elect
an in-service distribution with respect to such deferred Compensation pursuant
to Section 3.1(g) or (y) the Participant elects an in-service distribution but
the Participant’s Separation from Service, Disability or death occurs prior to
commencement of such in-service distribution.  If the Participant does not elect
a Payment Eligibility Date, the Participant will be deemed to have elected the
Payment Eligibility Date set forth in clause (i)(A) of this Section 3.1(h).  If
the Participant does not elect a form of benefit, the Participant will be deemed
to have elected a lump sum payment.

 

A Participant who has elected a Payment Eligibility Date set forth in clause
(i)(A) of this Section 3.1(h) may make a one-time election to change the Payment
Eligibility Date to the date that is five years following the original Payment
Eligibility Date or to the January 1 following such date, and a Participant who
has elected the Payment Eligibility Date set forth in clause (i)(B) of this
Section 3.1(h) may make a one-time election to change the Payment Eligibility
Date to the date that is five years following the original Payment Eligibility
Date, in each case by filing an election with the Bank or its agent, using a
form, method, or process approved by the Committee, at least one year prior to
the original Payment Eligibility Date; and a Participant making such change may
at the Participant’s option also concurrently change the form of benefit.  No
change to an election made under this Section 3.1(h) shall be permitted except
as expressly permitted herein.

 

(i) Effect of Elections.  Each distribution election under Section 3.1(g) and
Section 3.1(h) shall apply only to the Compensation deferred for the Plan Year
for which the election is made.  For each subsequent Plan Year a Participant may
make a separate election.  Any election filed pursuant to this Section 3.1 shall
be irrevocable for any one Plan Year except to the extent provided in
Section 3.1(g), Section 3.1(h), Section 6.1, Section 6.2 and Section 6.3.

 

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3.2                               Investment Elections.

 

(a) At the time of making each deferral election described in Section 3.1, the
Participant shall designate, using a form, method, or process approved by the
Committee, which Fund or Funds the Compensation deferred pursuant to such
election will be deemed to be invested in for purposes of determining the amount
of earnings or losses to be credited or debited to his or her Plan Year
Subaccount that the Committee establishes pursuant to Section 4.1 to account for
such deferred Compensation.

 

(b) In making the designation pursuant to this Section 3.2, the Participant must
specify, in multiples of one (1), the percentage of his or her corresponding
Plan Year Subaccount that shall be deemed to be invested in one or more Funds. 
A Participant may change the designation made under this Section 3.2 with
respect to any or all of his or her Plan Year Subaccounts by filing an election,
using a form, method, or process approved by the Committee.  If a Participant
fails to make an investment election for Compensation deferred in any Plan Year,
the Participant’s most recent investment election for future deferrals shall
apply to the Plan Year Subaccount established for such Plan Year and each Plan
Year Subaccount established with respect to any subsequent Plan Year
Subaccount(s) until the Participant files an election with the Bank or its agent
in accordance with the provisions of this Section 3.2 with respect to such Plan
Year Subaccount(s).  Notwithstanding the foregoing, if a Participant has not
previously elected a Fund under this Section 3.2, he or she shall be deemed to
have elected the money market option, or such other Fund that the Committee
designates as the default fund for purposes of this Plan.

 

(c) The Committee shall select from time to time, in its sole discretion, the
Funds in which Compensation deferred under this Plan will be deemed to be
invested.  The Earnings Rate of each Fund shall be used to determine the amount
of earnings or losses to be credited or debited to the Participant’s Deferral
Account under Article IV.  The Bank reserves the right to change the Funds, and
to increase or decrease the number of Funds, available as the Funds for purposes
of this Plan.

 

(d) Notwithstanding the Participant’s ability to designate the Funds in which
the Plan Year Subaccounts of his or her Deferral Account shall be deemed to be
invested, the Bank shall have no obligation to invest any funds in accordance
with any Participant’s election.  A Participant’s Deferral Account shall merely
be a bookkeeping entry on the Bank’s books, and no Participant shall obtain any
interest in any of the Funds.

 

(e) Effective as of January 1, 2008, the “CNC Stock” Fund will be added as a
Fund available under the Plan, subject to the following conditions and such
other conditions as the Committee which administers the Plan may determine:

 

(i)            A Participant may designate, using a form, method, or process
approved by the Committee, a percentage of his or her Plan Year Subaccount for
any Plan Year that shall be deemed to be invested in the CNC Stock Fund.

 

(A)          A Participant must make an election to designate the CNC Stock Fund
for all or a specified percentage of his or her Plan Year Subaccount for any
Plan Year beginning in 2008 or thereafter at the time when the Participant
elects to defer compensation for such Plan Year.

 

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(B)           A Participant will only be permitted to make a one-time election
in 2007 to designate the CNC Stock Fund for all or specified percentages of his
Plan Year Subaccounts for 2007 or earlier years.

 

(ii)           Notwithstanding any other provision of the Plan, a Participant
may not subsequently change his or her investment election (or diversify out of
the CNC Stock Fund) for any amounts which the Participant has designated to be
invested in the CNC Stock Fund.

 

(iii)          Notwithstanding any other provision of the Plan, unless otherwise
permitted by the Committee, no in-service distribution election may be made by a
Participant for any Plan Year Subaccount if any portion of such Plan Year
Subaccount is designated to be invested in the CNC Stock Fund.  The portion of
any Plan Year Subaccount which is designated to be invested in the CNC Stock
Fund will be distributed in a lump sum or installments following the
Participant’s Separation from Service, Disability or death at the same time when
other distributions are made from such Plan Year Subaccount pursuant to the
distribution elections made by the Participant in accordance with the provisions
of the Plan.

 

(A)          A Participant may not designate the CNC Stock Fund for his or her
Plan Year Subaccount for 2004 or any earlier year for which the Participant has
previously elected to receive an in service distribution.

 

(B)           A Participant may not designate the CNC Stock Fund for his or her
Plan Year Subaccount for any Plan Year between 2004 and 2007 for which the
Participant has previously elected to receive an in service distribution, unless
the Participant makes a new election in 2007 for such Plan Year Subaccount to
receive a distribution in a lump sum or installments following the Participant’s
Separation from Service, Disability or death in accordance with the provisions
of the Plan.

 

(iv)          The CNC Stock Fund will be measured in number of shares of City
National Corporation Common Stock (“CNC Stock”).  The number of shares of CNC
Stock will be appropriately adjusted, as determined by the Committee, to reflect
any stock splits, reverse stock splits, stock dividends, or similar events.

 

(v)           Shares in the CNC Stock Fund do not convey the rights to ownership
of shares of CNC Stock and do not have voting rights.  The Bank’s obligation
with respect to the CNC Stock Fund is unfunded.  A Participant will only acquire
ownership and voting rights when shares of CNC Stock are actually distributed to
the Participant in accordance with the provisions of the Plan.

 

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(vi)          All distributions from the CNC Stock Fund will be made solely in
CNC Stock, except that any fractional shares will be paid in cash.  The number
of shares distributed will be reduced to cover all taxes which are required to
be withheld by Bank in respect to distributions of CNC Stock under the Plan.

 

(vii)         All cash dividends which are paid on CNC Stock held in the CNC
Stock Fund will not be deemed to be invested in the CNC Stock Fund, but will be
credited in cash and will initially be deemed to be invested in the money market
option or such other Fund that the Committee designates for this purpose, and
thereafter may be reallocated by the Participant among Funds (other than the CNC
Stock Fund) as permitted by the Committee.

 

(viii)        All CNC Stock which is distributed to Participants pursuant to
this Plan will be distributed under a plan which has been approved by the
stockholders of the Corporation, if required to comply with any applicable
federal or state law or applicable New York Stock Exchange listing standard.

 

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ARTICLE IV

ACCOUNTS

 

4.1                               Deferral Account.

 

The Committee shall establish and maintain a Deferral Account for each
Participant under the Plan.  The Deferral Account shall be divided into Plan
Year Subaccounts to separately account for deferrals made for each Plan Year.  A
Participant’s Plan Year Subaccounts shall be divided into separate subaccounts
(“investment subaccounts”), each of which corresponds to a Fund elected by the
Participant pursuant to Section 3.2(a).  A Participant’s Plan Year Subaccount
for a Plan Year shall be credited as follows:

 

(a) The Committee shall credit the investment subaccounts of the Plan Year
Subaccount of the Participant’s Deferral Account with an amount equal to Salary
deferred by the Participant during each pay period that begins in the Plan Year
for which the Plan Year Subaccount is established on the day such Salary would
have been paid, in accordance with the Participant’s election under
Section 3.2(a); that is, the portion of the Participant’s deferred Salary that
the Participant has elected to be deemed to be invested in a certain Fund shall
be credited to the investment subaccount corresponding to that Fund; provided,
however, that if a Participant has designated the CNC Stock Fund pursuant to
Section 3.2(e) with respect to any Plan Year Subaccount or percentage thereof,
then any amounts of Salary credited to the investment subaccounts of such Plan
Year Subaccount pursuant to this Section 4.1(a) shall be credited on the last
business day of the month in which such Salary would have been paid;

 

(b) The Committee shall credit the investment subaccounts of the Plan Year
Subaccount of the Participant’s Deferral Account with an amount equal to the
portion of the Bonus deferred by the Participant for the Plan Year for which the
Plan Year Subaccount is established on the day the Bonus or partial Bonus would
have been paid, in accordance with the Participant’s election under
Section 3.2(a); that is, the portion of the Participant’s deferred Bonus that
the Participant has elected to be deemed to be invested in a certain Fund shall
be credited to the investment subaccount corresponding to that Fund;

 

(c) The Committee shall credit the investment subaccounts of the Plan Year
Subaccount of the Participant’s Deferral Account with an amount equal to the
portion of the Commissions deferred by the Participant earned during the Plan
Year for which the Plan Year Subaccount is established on the day the
Commissions would have been paid, in accordance with the Participant’s election
under Section 3.2(a); that is, the portion of the Participant’s deferred
Commission that the Participant has elected to be deemed to be invested in a
certain Fund shall be credited to the investment subaccount corresponding to
that Fund; and

 

(d) As of the close of each business day, each investment subaccount of a
Participant’s Plan Year Subaccount of the Participant’s Deferral Account shall
be credited with earnings or losses in an amount determined by multiplying the
balance credited to such investment subaccount as of the beginning of the same
business day by the Earnings Rate for the corresponding Fund; provided, however,
that all cash dividends which are paid on CNC Stock held in the CNC Stock Fund
shall be credited in accordance with Section 3.2(e)(vii) on the day such
dividends would otherwise be paid.

 

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4.2                               Rollovers.

 

If an individual who was both an active employee of the Bank and a participant
in the Prior Plan on December 31, 1999 either (a) executes an “Agreement for
Transfer of Policy and Termination of Split-Dollar Life Insurance Agreement” or
(b) did not own a life insurance policy that was subject to a Split-Dollar Life
Insurance Agreement with the Corporation on December 31, 1999, then his or her
account balance under the Prior Plan shall be transferred to an Account
established for such individual under this Plan, shall be governed by the terms
and conditions of this Plan and shall be referred to as the “Rollover Amount.” 
A Participant’s Rollover Amount shall be credited to a separate Plan Year
Subaccount.  A Participant may make separate distribution and investment
elections applicable to his or her Rollover Amount in accordance with Articles
III and VI of this Plan.

 

4.3                               Profit Sharing Make-Up Contributions.

 

(a) In the case of a Participant entitled to receive an allocation of Employer
Contributions under Paragraph D.2 of Article IV of the CNC Profit Sharing Plan
with respect to any Plan Year, such Participant’s Plan Year Subaccount for such
Plan Year shall be credited with additional contributions by the Bank or the
Corporation at such time and in such amount set forth in this Section 4.3
(“Profit Sharing Make-Up Contributions”); provided, however, that a Participant
shall not be eligible to receive a Profit Sharing Make-Up Contribution for any
Plan Year unless the Participant is an employee of the Bank or an Affiliate on
the last business day of such Plan Year.

 

(b) The aggregate amount of Profit Sharing Make-Up Contributions to all
Participants for a Plan Year shall be the excess, if any, of (i) the aggregate
amount of the Employer Contribution under the CNC Profit Sharing Plan for such
Plan Year, if such contribution were determined without giving effect to any
deferrals by Participants under this Plan (but giving effect to any other
limitations on the amount of the Employer Contribution pursuant to the CNC
Profit Sharing Plan), over (ii) the aggregate amount of the actual Employer
Contribution made under the CNC Profit Sharing Plan for such Plan Year.  For the
avoidance of doubt, the actual Employer Contribution made under the CNC Profit
Sharing Plan, together with the aggregate Profit Sharing Make-Up Contributions
under this Plan, for any Plan Year shall not exceed the aggregate maximum limit
allowed under the CNC Profit Sharing Plan.  No Profit-Sharing Make-Up
Contributions shall be made for a Plan Year if the actual Employer Contribution
is equal to the aggregate maximum limit allowed under the CNC Profit Sharing
Plan

 

(c) Each Participant’s Profit Sharing Make-Up Contribution for such Plan Year
shall be determined by multiplying the aggregate amount (if any) computed under
Section 4.3(b) by the ratio of (i) the amount of Compensation (as such term is
used in the CNC Profit Sharing Plan) that such Participant has elected to defer
pursuant to this Plan for such Plan Year, over (ii) the aggregate amount of
Compensation (as such term is used in the CNC Profit Sharing Plan) that each
Participant who is eligible to receive a Profit Sharing Make-Up Contribution has
elected to defer pursuant to this Plan for such Plan Year.  For purposes of the
preceding sentence, the amount of Compensation (as such term is used in the CNC
Profit Sharing Plan) deferred by any Participant for a Plan Year shall be
determined by calculating the excess of such Participant’s Compensation (as such
term is used in the CNC Profit Sharing Plan) for such Plan Year without

 

13

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giving effect to any deferral under this Plan over such Participant’s actual
Compensation (as such term is used in the CNC Profit Sharing Plan) for such Plan
Year.

 

(d) The Profit Sharing Make-Up Contribution shall be credited to the
Participant’s Plan Year Subaccount for the Plan Year to which such Profit
Sharing Make-Up Contribution relates, and shall be credited to such Plan Year
Subaccount on the last business day of the month in which an Employer
Contribution was made under the CNC Profit Sharing Plan with respect to such
Plan Year (but in any event no later than the end of the first Plan Year
following the Plan Year to which such Profit Sharing Make-Up Contribution
relates).

 

(e) Each Profit Sharing Make-Up Contribution shall be subject to the deferral
elections and investment elections under Article III of this Plan (other than
any election under Section 3.1(g) of this Plan) applicable to the Plan Year
Subaccount to which such Profit Sharing Make-Up Contribution was credited and
shall be invested and distributed in accordance with such elections and
Section 6.1(b) of this Plan.

 

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ARTICLE V

VESTING

 

5.1                               Deferral Account.

 

A Participant’s Deferral Account shall be 100% vested at all times, except as
otherwise provided in Section 5.2 hereof.

 

5.2                               Profit Sharing Make-Up Contributions.

 

The portion of each Plan Year Subaccount attributable to Profit Sharing Make-Up
Contributions shall vest in accordance with the vesting provisions for Employer
Contribution Accounts under the CNC Profit Sharing Plan, as set forth in
Article VI of the CNC Profit Sharing Plan.

 

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ARTICLE VI

DISTRIBUTIONS

 

6.1                               Distribution of Deferred Compensation.

 

(a) Distribution of the amount credited to each Plan Year Subaccount of the
Participant’s Deferral Account that is subject to an in-service distribution
election made by the Participant pursuant to Section 3.1(g) shall be made or
shall commence within 90 days following January 1 of the year elected by the
Participant in the form elected by the Participant, provided that the
Participant is employed by the Bank on January 1 of such year.  In the event of
the Participant’s Separation from Service with the Bank for any reason,
Disability or death prior to January 1 of a year elected by the Participant for
a Plan Year Subaccount pursuant to Section 3.1(g), the Participant’s in-service
distribution election for such Plan Year Subaccount shall no longer be effective
and all of the amounts credited to such Plan Year Subaccount shall be
distributed as set forth in the following subsections of this Section 6.1 in
accordance with any applicable election by the Participant.  In the event of the
Participant’s Separation from Service, Disability or death while the Participant
is receiving an in-service distribution from one or more Plan Year Subaccounts
in the form of annual installments, such payments will continue as scheduled.

 

(b) In the event of a Participant’s Separation from Service for any reason,
Disability, or death, the amounts credited to each Plan Year Subaccount that is
not then in pay status pursuant to an in-service distribution election shall be
distributed to the Participant (or his or her Beneficiary) in accordance with
this Section 6.1(b) and the Participant’s elections under Section 3.1(h), as
follows:

 

(i)                                     If the Participant has elected a lump
sum payment with respect to a Plan Year Subaccount, such payment will be made
within 90 days following the Payment Eligibility Date.

 

(ii)                                  If the Participant has elected payment in
installments with respect to a Plan Year Subaccount, the first installment shall
be paid within 90 days following the Payment Eligibility Date, and each
subsequent quarterly installment shall be paid within 90 days following the
first day of the applicable calendar quarter.

 

(iii)                               Notwithstanding anything contained in this
Section 6.1(b) to the contrary, in the event that the total aggregate amount
credited to a Participant’s Deferral Account is less than $25,000 as of the end
of the month preceding the Participant’s Payment Eligibility Date for a Plan
Year Subaccount, the amounts credited to such Plan Year Subaccount shall be paid
in a cash lump sum payment within 90 days following the Payment Eligibility
Date.

 

(c) [Intentionally Omitted.]

 

(d) The Participant’s Plan Year Subaccounts shall continue to be credited with
earnings pursuant to Sections 4.1 and 4.2 of the Plan until all amounts credited
to his or her Plan Year Subaccounts under the Plan have been distributed.

 

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(e) In the event that a former Participant dies while receiving installment
payments under this Plan, any remaining installments shall be paid to the
Participant’s Beneficiary as such installments would have otherwise been due to
the Participant.

 

(f) [Intentionally Omitted.]

 

(g) A change in control of the Bank or the Corporation shall not accelerate the
distribution of amounts credited to Participants’ Deferral Accounts.

 

6.2                               Nonscheduled In-Service Withdrawals.

 

No nonscheduled in-service withdrawals are permitted under the Plan.  In the
event that a Participant elects a nonscheduled in-service withdrawal with
respect to Grandfathered Amounts in accordance with the terms of the Plan as in
effect immediately prior to January 1, 2009, (a) the Participant shall be
ineligible to participate in the Plan during the two Plan Years immediately
following the Plan Year in which the withdrawal occurs, and (b) any deferral
elections made by the Participant for such Plan Years shall terminate.

 

6.3                               Hardship Withdrawals.

 

Upon written request of a Participant, the Committee may, in its sole
discretion, make a lump sum payment to a Participant and/or accelerate the
payment of installment payments due to the Participant in order to meet a severe
financial hardship to the Participant resulting from (a) a sudden and unexpected
illness or accident of the Participant or the Participant’s spouse, beneficiary,
or dependent within the meaning of Section 1.409A-3(h)(3) of the Treasury
Regulations, (b) loss of the Participant’s property due to casualty or (c) other
similar extraordinary and unforeseeable circumstances arising as a result of
events beyond the control of the Participant.  However, no payment shall be made
under this Section 6.3 to the extent that a hardship is or may be relieved
(a) through reimbursement or compensation by insurance or otherwise, (b) by
liquidation of the Participant’s assets, to the extent the liquidation of such
assets would not itself cause severe financial hardship or (c) by cessation of
deferrals under the Plan effective for the next Plan Year in accordance with
Section 1.409A-3(j)(4)(viii) of the Treasury Regulations.  The amount of any
hardship lump sum payment and/or accelerated amount under this Section 6.3 shall
not exceed the lesser of (a) the amount reasonably necessary to meet the
immediate financial need created by such hardship or (b) the entire amounts
credited to the Participant’s Accounts.  The amount of any such payments shall
be deducted from the amounts credited to the Participant’s Plan Year Subaccounts
in such order and in such proportions as the Committee may determine in its sole
discretion.  The remaining amounts credited to a Participant’s Plan Year
Subaccounts shall be distributed in accordance with the Participant’s elections
with respect to such Plan Year Subaccounts.  Any hardship withdrawals under this
Section 6.3 shall comply with the requirements of Section 409A of the Code.

 

6.4                               Inability to Locate Participant.

 

In the event that the Committee is unable to locate a Participant or Beneficiary
within two years following the Participant’s Payment Eligibility Date, the
amounts allocated to the Participant’s Deferral Account shall be forfeited.  If,
after such forfeiture, the Participant or

 

17

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Beneficiary later claims such benefits, such benefits shall be reinstated
without interest or earnings, to the extent permitted by Section 409A of the
Code.

 

6.5                               Death Benefit for Certain Participants.

 

(a) For each Participant who is named in the list attached hereto as Schedule 1,
the Bank shall provide life insurance coverage in the amount set forth next to
his or her name in Schedule 1, beginning on the date such Participant executes
an “Agreement for Transfer of Policy and Termination of Split-Dollar Life
Insurance Agreement” and ending on December 31, 2009 (the “Coverage Period”). 
Such life insurance coverage shall remain in effect throughout the Coverage
Period even if the Participant ceases to be employed by the Bank.

 

(b) The Bank shall provide such life insurance coverage by maintaining a life
insurance policy (the “Policy”) on the life of each named Participant.  Each
such Participant shall be entitled to name a beneficiary (which need not be his
or her Beneficiary under this Plan) to receive the portion of the death benefit
under the Policy that is equal to the amount set forth as his or her death
benefit in Schedule 1 (his or her “Death Benefit”).  The Participant may make a
beneficiary designation or change a beneficiary designation in writing in
accordance with procedures established by the Committee.  No beneficiary
designation will become effective until it is filed in accordance with the
Committee’s procedures.  If no beneficiary designation is in effect, the Death
Benefit shall be paid to the Participant’s Beneficiary under this Plan.  If the
actual death benefit under the Policy exceeds the Death Benefit, the excess
death benefit under the Policy shall be paid to the Bank.

 

(c) At the end of the Coverage Period, the Bank shall cease to provide the life
insurance coverage described herein and the provisions of this Section 6.5 shall
terminate and have no further effect.

 

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ARTICLE VII

ADMINISTRATION

 

7.1                               Committee Action.

 

The Committee shall act at meetings by affirmative vote of a majority of the
members of the Committee.  Any action permitted to be taken at a meeting may be
taken without a meeting if, prior to such action, a written consent to the
action is signed by all members of the Committee and such written consent is
filed with the minutes of the proceedings of the Committee.  A member of the
Committee shall not vote or act upon any matter which relates solely to himself
or herself as a Participant.  The Chairman or any other member or members of the
Committee designated by the Chairman may execute any certificate or other
written direction on behalf of the Committee.

 

7.2                               Powers and Duties of the Committee.

 

(a) The Committee, on behalf of the Participants and their Beneficiaries, shall
enforce the Plan in accordance with its terms, shall be charged with the general
administration of the Plan, and shall have all powers necessary to accomplish
its purposes, including, but not by way of limitation, the following:

 

(i)                                     To select the funds or portfolios to be
the Funds in accordance with Section 3.2(b) hereof;

 

(ii)                                  To construe and interpret the terms and
provisions of this Plan;

 

(iii)                               To compute and certify to the amount and
kind of benefits payable to Participants and their Beneficiaries;

 

(iv)                              To maintain all records that may be necessary
for the administration of the Plan;

 

(v)                                 To provide for the disclosure of all
information and the filing or provision of all reports and statements to
Participants, Beneficiaries or governmental agencies as shall be required by
law;

 

(vi)                              To make and publish such rules for the
regulation of the Plan and procedures for the administration of the Plan as are
not inconsistent with the terms hereof; and

 

(vii)                           To appoint a plan administrator or any other
agent, and to delegate to them such powers and duties in connection with the
administration of the Plan as the Committee may from time to time prescribe.

 

7.3                               Construction and Interpretation.

 

The Committee shall have full discretion to construe and interpret the terms and
provisions of this Plan, which interpretation or construction shall be final and
binding on all

 

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parties, including but not limited to the Bank and any Participant or
Beneficiary.  The Committee shall administer such terms and provisions in a
uniform and nondiscriminatory manner and in full accordance with any and all
laws applicable to the Plan.

 

7.4                               Information.

 

To enable the Committee to perform its functions, the Bank shall supply full and
timely information to the Committee on all matters relating to the Compensation
of all Participants, their death or other cause of termination, and such other
pertinent facts as the Committee may require.

 

7.5                               Compensation, Expenses and Indemnity.

 

(a) The members of the Committee shall serve without compensation for their
services hereunder.

 

(b) The Committee is authorized at the expense of the Bank to employ such legal
counsel as it may deem advisable to assist in the performance of its duties
hereunder.  Expenses and fees in connection with the administration of the Plan
shall be paid by the Bank.

 

(c) To the extent permitted by applicable state law, the Bank shall indemnify
and save harmless the Committee and each member thereof, the Board of Directors
and each member thereof, and delegates of the Committee who are employees of the
Bank against any and all expenses, liabilities and claims, including legal fees
to defend against such liabilities and claims arising out of their discharge in
good faith of responsibilities under or incident to the Plan, other than
expenses and liabilities arising out of willful misconduct.  This indemnity
shall not preclude such further indemnities as may be available under insurance
purchased by the Bank or provided by the Bank under any bylaw, agreement or
otherwise, as such indemnities are permitted under state law.

 

7.6                               Quarterly Statements.

 

Under procedures established by the Committee, a Participant shall receive a
statement with respect to such Participant’s Account as of the last day of each
calendar quarter.

 

7.7                               Claims Procedure.

 

(a) Claim.  A person who believes that he or she is being denied a benefit to
which he or she is entitled under this Plan (hereinafter referred to as
“Claimant”) may file a written request for such benefit with the Committee,
setting forth his or her claim.  The request must be addressed to the Committee
at the Bank’s principal place of business.

 

(b) Claim Decision.  Upon receipt of a claim, the Committee shall advise the
Claimant that a reply will be forthcoming within ninety (90) days and shall, in
fact, deliver such reply within such period.  The Committee may, however, extend
the reply period for an additional ninety (90) days for special circumstances. 
If the claim is denied in whole or in part, the Committee shall inform the
Claimant in writing, using language calculated to be understood by the Claimant,
setting forth:  (i) the specified reason or reasons for such denial; (ii) the
specific

 

20

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reference to pertinent provisions of this Plan on which such denial is based;
(iii) a description of any additional material or information necessary for the
Claimant to perfect his or her claim and an explanation why such material or
such information is necessary; (iv) appropriate information as to the steps to
be taken if the Claimant wishes to submit the claim for review; and (v) the time
limits for requesting a review under subsection (c).

 

(c) Request for Review.  Within sixty (60) days after the receipt by the
Claimant of the written opinion described above, the Claimant may request in
writing that the Committee review the determination.  Such request must be
addressed to the Committee, at the Bank’s principal place of business.  The
Claimant or his or her duly authorized representative may, but need not, review
the pertinent documents and submit issues and comments in writing for
consideration by the Committee.  If the Claimant does not request a review
within such sixty (60) day period, he or she shall be barred and estopped from
challenging the original determination.

 

(d) Review of Decision.  Within sixty (60) days after the Committee’s receipt of
a request for review, after considering all materials presented by the Claimant,
the Committee will inform the Claimant in writing, in a manner calculated to be
understood by the Claimant, of its decision setting forth the specific reasons
for the decision and containing specific references to the pertinent provisions
of this Plan on which the decision is based.  If special circumstances require
that the sixty (60) day time period be extended, the Committee will so notify
the Claimant and will render the decision as soon as possible, but no later than
one hundred twenty (120) days after receipt of the request for review.

 

21

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ARTICLE VIII

MISCELLANEOUS

 

8.1                               Unsecured General Creditor.

 

Participants and their Beneficiaries, heirs, successors, and assigns shall have
no legal or equitable rights, claims, or interest in any specific property or
assets of the Bank.  No assets of the Bank shall be held under any trust, or
held in any way as collateral security for the fulfilling of the obligations of
the Bank under this Plan, although the Bank may establish one or more grantor
trusts subject to Code Section 671 to facilitate the payment of benefits
hereunder.  Any and all of the Bank’s assets shall be, and remain, the general
unpledged, unrestricted assets of the Bank.  The Bank’s obligation under the
Plan shall be merely that of an unfunded and unsecured promise of the Bank to
pay money in the future, and the rights of the Participants and Beneficiaries
shall be no greater than those of unsecured general creditors.  It is the
intention of the Bank that this Plan and any trust established to facilitate the
payment of benefits hereunder be unfunded for purposes of the Code and for
purposes of Title I of ERISA.

 

8.2                               Restriction Against Assignment.

 

The Bank shall pay all amounts payable hereunder only to the person or persons
designated by the Plan and not to any other person or corporation.  No part of a
Participant’s Account shall be liable for the debts, contracts, or engagements
of any Participant, his or her Beneficiary, or successors in interest, nor shall
a Participant’s Account be subject to execution by levy, attachment, or
garnishment or by any other legal or equitable proceeding, nor shall any such
person have any right to alienate, anticipate, sell, transfer, commute, pledge,
encumber, or assign any benefits or payments hereunder in any manner
whatsoever.  If any Participant, Beneficiary or successor in interest is
adjudicated bankrupt or purports to anticipate, alienate, sell, transfer,
assign, pledge, encumber or charge any distribution or payment from the Plan,
voluntarily or involuntarily, the Committee, in its discretion, may cancel such
distribution or payment (or any part thereof) to or for the benefit of such
Participant, Beneficiary or successor in interest in such manner as the
Committee shall direct.

 

8.3                               Withholding.

 

There shall be deducted from each payment made under the Plan or any other
compensation payable to the Participant (or Beneficiary) all taxes which are
required to be withheld by the Bank in respect to such payment or this Plan. 
The Bank shall have the right to reduce any payment (or other compensation) by
the amount of cash sufficient to provide the amount of said taxes.

 

8.4                               Amendment, Modification, Suspension or
Termination.

 

The Bank may amend, modify, suspend or terminate the Plan in whole or in part,
except that no amendment, modification, suspension or termination shall have any
retroactive effect to reduce any amounts allocated to a Participant’s Account. 
In the event that this Plan is terminated, the distribution of the amounts
credited to a Participant’s Deferral Account shall not be accelerated but shall
be paid at such time and in such manner as determined under the terms of the
Plan immediately prior to termination as if the Plan had not been terminated. 
(Neither the

 

22

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Policies themselves nor the death benefit described in Section 6.5 shall be
treated as allocated to Accounts.)  Notwithstanding the foregoing, no amendment
of the Plan shall apply to Grandfathered Amounts unless the amendment
specifically provides that it applies to such amounts.

 

8.5                               Governing Law.

 

This Plan shall be construed, governed and administered in accordance with the
laws of the State of California.

 

8.6                               Receipt or Release.

 

Any payment to a Participant or the Participant’s Beneficiary in accordance with
the provisions of the Plan shall, to the extent thereof, be in full satisfaction
of all claims against the Committee, and the Bank.  The Committee may require
such Participant or Beneficiary, as a condition precedent to such payment, to
execute a receipt and release to such effect within such time as may be
specified by the Committee in accordance with applicable law, but in any event
no later than 60 days after the first date on which such payment could otherwise
be made pursuant to the terms of the Plan.

 

8.7                               Payments on Behalf of Persons Under
Incapacity.

 

In the event that any amount becomes payable under the Plan to a person who, in
the sole judgment of the Committee, is considered by reason of physical or
mental condition to be unable to give a valid receipt therefor the Committee may
direct that such payment be made to any person found by the Committee, in its
sole judgment, to have assumed the care of such person.  Any payment made
pursuant to such determination shall constitute a full release and discharge of
the Committee and the Bank.

 

8.8                               Headings, etc. Not Part of Agreement.

 

Headings and subheadings in this Plan are inserted for convenience of reference
only and are not to be considered in the construction of the provisions hereof.

 

8.9                               Section 409A of the Code.

 

(a) This Plan shall be interpreted in accordance with Section 409A of the Code
and the Treasury Regulations and other Department of Treasury guidance issued
thereunder. Notwithstanding any provision of the Plan to the contrary, in the
event that the Committee determines that any payment or benefit under the Plan
may be subject to Section 409A of the Code, the Committee may adopt such
amendments to the Plan or adopt other policies and procedures (including
amendments, policies and procedures with retroactive effect), or take any other
actions, that the Committee determines are necessary or appropriate to comply
with the requirements of Section 409A of the Code.

 

(b) Each payment or series of installments under this Plan for any particular
Plan Year and Plan Year Subaccount shall be considered a single payment for
purposes of Section 409A.

 

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(c) If, on the date of a Participant’s Separation from Service, (i) such
Participant is a “specified employee” within the meaning of Section 409A of the
Code, as determined annually by the Bank in accordance with
Section 1.409A-1(i) of the Treasury Regulations (using the methodology for
identifying Key Employees under Paragraph A.2 of Article VIII of the CNC Profit
Sharing Plan, to the extent permitted by Section 409A of the Code), and (ii) the
Committee shall make a good-faith determination that a payment or benefit under
the Plan constitutes “deferred compensation” within the meaning of Section 409A
of the Code the payment (or, in the case of an installment payment, the
commencement) of which is required to be delayed pursuant to the six-month delay
rule set forth in Section 409A of the Code in order to preserve the tax
treatment intended for such payment or to avoid additional tax, interest, or
penalties under Section 409A of the Code, then the Bank shall not pay such
amount or commence payment of such installments on the otherwise scheduled
payment date, but shall instead pay such amount or commence payment of such
installments within the calendar month following the last day of such six-month
period and, in the case of an installment payment, shall delay each subsequent
installment by six months from the date such installment would otherwise have
been paid.  Such amount shall be paid without additional interest (other than
any earnings or losses credited to the Participant’s Deferral Account pursuant
to Section 4.1(d)), unless otherwise determined by the Committee, in its sole
discretion, or as otherwise provided in any applicable agreement between the
Bank and the Participant.

 

(d) A Participant shall be solely responsible and liable for the satisfaction of
all taxes, interest, and penalties that may be imposed on such Participant or
for such Participant’s account in connection with any payment or benefit under
the Plan (including any taxes, interest, and penalties under Section 409A or any
corresponding provision of state, local, or foreign law), and the Bank shall
have no obligation to indemnify or otherwise hold such Participant harmless from
any or all of such taxes, interest, or penalties.

 

(e) If any portion of a Participant’s Deferral Account is required to be
included in income by the Participant prior to receipt due to a failure of this
Plan to comply with the requirements of Section 409A of the Code, the Committee
may determine that such Participant shall receive a distribution from the Plan
in an amount equal to the lesser of (i) the portion of his or her Deferral
Account required to be included in income as a result of the failure of the Plan
to comply with the requirements of Section 409A of the Code or (ii) the unpaid
vested portion of his or her Deferral Account, as permitted under
Section 1.409A-3(j)(4)(vii) of the Treasury Regulations.

 

8.10                        Domestic Relations Orders.

 

If necessary to comply with a domestic relations order, as defined in
Section 414(p)(1)(B) of the Code, the Committee shall have the right to make a
distribution from the Participant’s Deferral Account to (or establish an account
under the Plan for the benefit of) an individual other than the Participant and
to accelerate the time of payment to the extent necessary to comply with the
domestic relations order, as permitted under Section 409A of the Code and
Section 1.409A-3(j)(4)(ii) of the Treasury Regulations.

 

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IN WITNESS WHEREOF, the Bank has caused its duly authorized officer to execute
this document this     th day of December, 2008.

 

 

CITY NATIONAL BANK

 

 

 

 

 

By:

 

 

 

Patti Fischer

 

Its:

Senior Vice President

 

 

Human Resources

 

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