Exhibit 10.1


 


STOCK
OPTION AWARD AGREEMENT


UNDER THE


CITY
NATIONAL CORPORATION


AMENDED AND RESTATED 2002 OMNIBUS
PLAN


 


This Stock Option
Agreement is made and entered into as of, by and between City National Corporation, a Delaware corporation (the “Company”),
and, an employee of the Company or a
subsidiary of the Company (the “Optionee”), with reference to the following:


 


A.            On April 28, 2004 the
shareholders of the Company adopted the City National Corporation Amended and
Restated 2002 Omnibus Plan as amended from time to time thereafter, (the “Plan”),
pursuant to which the Compensation, Nominating & Governance Committee of
the Board of Directors (the “Committee”) may grant selected officers and other
Company or Company subsidiary employees options to purchase shares of the
Company’s common stock, $1.00 par value (the “Common Stock”).


 


B.            The Committee has determined to grant Optionee an Option
to purchase shares of Common Stock pursuant to the terms and conditions of this
Agreement. This Option is not an Incentive Stock Option, as that term is
defined in Section 422 of the Internal Revenue Code and Treasury regulations
thereunder.


 


NOW,
THEREFORE, in consideration of the foregoing recitals and the
performance of the mutual covenants contained herein, it is hereby agreed as
follows:


 


1.             Grant of Option. The
Company hereby grants to Optionee the right and option to purchase (the “Option”),
upon the terms and conditions set forth in this Agreement, all or any part of
the following number of Shares of Common Stock at the following price per
share:


 


	
   

  	
  Number
  of Shares

  	
   

  	
  Price
  Per Share

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  



 


The number of shares
subject to the Option and the Option exercise price are subject to adjustment
in certain events, as provided in the Plan.


 


2.             Time of Exercise. The
Option will vest and may be exercised at any time and from time to time after
the dates set forth in the following schedule and before the Termination Date
(as defined below) as to all or any number of full Shares not exceeding in the
aggregate that percentage of all of the Shares set forth opposite each such
date:


 


	
  Time from

  Date of Grant

  	
   

  	
  Options

  Vesting

  	
   

  	
  Total Percentage of Shares as to which Options

  May be Exercised

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  After 1 year

  	
   

  	
  25

  	
  %

  	
  25

  	
  %

  
	
  After 2 years

  	
   

  	
  25

  	
  %

  	
  50

  	
  %

  
	
  After 3 years

  	
   

  	
  25

  	
  %

  	
  75

  	
  %

  
	
  After 4 years

  	
   

  	
  25

  	
  %

  	
  100

  	
  %

  
	
  After 10 years
  (the “Termination Date”)

  	
   

  	
   

  	
   

  	
  Any unexercised Options
  

  will expire at this time

  	
   

  



 


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Notwithstanding the foregoing, all of the Options
shall immediately vest on the earlier of (i) subject to the discretion of the
Committee, the occurrence of a Change in Control Event (as such term is defined
in the Plan), or (ii) the date Optionee’s employment with the Company is
terminated by reason of death or Total Disability. In the event Colleague’s
employment is terminated for any other reason, the Committee or its delegate,
as appropriate, may, in the Committee’s or such delegate’s sole discretion,
approve the vesting as to any or all Options still subject to vesting, such vesting
to be effective on the date of such approval or Optionee’s termination date, if
later.


 


3.             Method of Exercise. The
Option or any part thereof may be exercised by giving written notice of
exercise to the Company, sent directly to the Controller’s Department, which
notice must state the number of full Shares to be purchased, and must be
accompanied by payment in full for the number of Shares to be purchased. Subject
to the Company’s Securities Trading Policy as may be in effect from time to
time, such payment may be in cash, in Shares of Common Stock, or in a
broker-assisted same-day sale transaction or a combination thereof. If any part
of such payment consists of Common Stock, such Common Stock must have been
owned for at least six months and will be valued at the last sale price of such
Common Stock as reported by the New York Stock Exchange on the date of
exercise. If Optionee’s notice is received by the Controller’s Office before
1:00 p.m (PT), the date of exercise of the Option, will be the date of receipt
by the Controller’s Office. The exercise date for notices received after 1:00
p.m. (PT) will be the business day following the date of receipt by the
Controller’s Office. Not less than 100 Shares may be purchased at any one time
unless the Shares purchased are all of the Shares then purchasable under the
Option.


 


The Company will issue
and deliver to Optionee a certificate for the number of Shares purchased;
provided, however, that if any federal or state law or regulation of any
securities exchange listing the Company’s Shares requires the Company to take
any action with respect to the exercised Share before issuance thereof, then
the date for issuance and delivery of such Shares will be extended for the
period of time necessary to take such action.


 


4.             Withholding of Tax. The exercise of
Non-Qualified Stock Options may result in income to you for federal or state
tax purposes. To the extent that you become subject to taxation, you shall
deliver to the Company at the time of such exercise such amount of money or Shares
of unrestricted Common Stock, as the Company may require to meet its
withholding obligation under applicable tax laws or regulations. If you fail to
do so, the Company is authorized to withhold from any cash or stock
remuneration then or thereafter payable to you any tax required to be withheld
by reason of such resulting compensation income. If you exercise Stock Options
through a cashless transaction, taxes will be withheld from the proceeds of the
sale of Shares. Your delivery of Shares to meet the tax withholding obligation
is subject to the Company’s Securities Trading Policy as may be in effect from
time to time. You must have owned any Common Stock you deliver for at least six
months. Any Common Stock you deliver or which is withheld by the Company will
be valued on the date of which the amount of tax to be withheld is determined. Any
fractional Shares of Common Stock resulting from withholding of taxes will be
paid to you in cash.


 


5.             Expiration of Options after
Termination. Stock Options and all rights granted under this
Agreement, to the extent such rights have not been exercised, will terminate on
the earlier of the Termination Date or the earliest to occur of the following:


 


5.1              Immediately upon
termination of Optionee’s employment for cause or any resignation which is in
lieu of a termination for cause, as defined below.


 


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5.2              If the employment of
the Optionee terminates for any reason other than for cause, death, Retirement,
Total Disability or disability, three (3) months after the date of such
termination.


 


5.3              If Optionee’s
employment terminates by reason of Retirement, Total Disability or disability,
three (3) years after the date of such termination.


 


5.4              If Optionee dies while
employed by the Company or within three (3) months after Optionee’s employment
is terminated under the conditions specified in subparagraph 5.2 or 5.3 above,
one (1) year after death. After the Optionee’s death, the Option and all rights
granted under this Agreement, to the extent such rights will not theretofore
have been exercised, may be exercised by Optionee’s designated Beneficiary, or
if none, by the Optionee’s personal representative or by the person or persons
to whom the Option will pass by will or by the applicable laws of descent and
distribution.


 


Termination of Optionee’s
employment with the Company to accept employment with a subsidiary of the
Company, or vice versa or to go on leave of absence at the request, or with the
approval, of the Company will not be deemed a termination of employment for the
for the purpose of this paragraph. In the event of termination of employment,
Optionee may exercise the Option only to the extent vested under paragraph 2
above on the date of termination.


 


Termination for cause,
for purposes of the Plan and this Agreement, refers to any termination
resulting from:  (a) conviction of a
crime that is disqualifying from employment under City National’s Criminal
Convictions Policy, as set forth in the Colleague Handbook, absent an FDIC
waiver; or (b) gross misconduct or willful engagement in illegal conduct; or
(c) willful and continued failure to perform substantially all of the Optionee’s
duties with City National (except when such failure is due to incapacity due to
physical or mental illness); or (d) a conflict of interest, as set forth in the
CNB Code of Conduct.


 


6.             Limitation on Transfer. Except
as otherwise provided in subparagraph 5.4 above, or pursuant to a DRO, the
Option and all rights granted under this Agreement are personal to Optionee and
cannot be transferred, assigned, pledged or hypothecated in any way (whether by
operation of law or otherwise) and will not be subject to execution, attachment
or similar processes.


 


7.             Employment Relationship. For purposes
of this Agreement, Optionee shall be considered to be in the employment of the
Company as long as Optionee remains an employee of either the Company, any
successor corporation or a parent or subsidiary corporation (as defined in
section 424 of the Internal Revenue Code) of the Company or any successor
corporation. Any question as to whether and when there has been a termination
of such employment, and the cause of such termination, shall be determined by
the Committee, or its delegate, as appropriate, and its determination shall be
final.


 


The Plan and this Agreement shall not constitute a
contract of employment between the Company, any successor corporation or a
parent or subsidiary corporation of the Company or any successor corporation
and Optionee. Each Optionee is an at-will employee except
as provided in any other written agreement. Nothing contained in the
Plan (or any Award made pursuant to this Plan) or the Agreement shall confer
upon Optionee any right to continue in the employment of the Company, or
guarantee of payment of future incentives, or shall interfere with, affect or
restrict in any way, the rights of the Company, which are expressly reserved,
to discharge Optionee, any time for any reason whatsoever, with or without
cause.


 


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8.             Availability of Plan/Plan
Incorporated. Optionee acknowledges that Company has made
available to Optionee a copy of the Plan and agrees that this Award of Options
shall be subject to all of the terms and conditions set forth in the Plan,
including future amendments thereto, if any, pursuant to the terms thereof,
which Plan is incorporated herein by reference as a part of this Agreement. In
the event of any conflict between the Plan and this Agreement, the provisions
of the Plan will prevail. Optionee’s rights hereunder are subject to
modification or termination in certain events, as provided in the Plan,
including without limitation such rules and regulations as may from time to
time be adopted or promulgated in accordance with paragraph 1.3 of the Plan. Capitalized
terms not defined in this Agreement shall have the meanings set forth in the
Plan.


 


9.             Committee Powers.
No provision contained in this Agreement shall in any way terminate, modify or
alter, or be construed or interpreted as terminating, modifying or altering any
of the powers, rights or authority vested in the Committee or, to the extent
delegated, in its delegate pursuant to the terms of the Plan or resolutions
adopted in furtherance of the Plan, including, without limitation, the right to
make certain determinations and elections with respect to the Options. All
decisions of the Committee (as established pursuant to the Plan) with respect
to any questions concerning the application, administration or interpretation
of the Plan will be conclusive and binding on the Company and Optionee.


 


10.          No Rights as Shareholder. Optionee
will have no rights as shareholder with respect to Shares of Common Stock
covered by this Option until the date of the issuance of a stock certificate or
stock certificates. No adjustment will be made for cash dividends for which the
record date is prior to the date such stock certificate or certificates are
issued.


 


12.          Compliance with Securities Laws. No
Shares may be purchased or issued upon the exercise of this Option unless and
until any then applicable requirements of the Securities and Exchange
Commission, the California Commissioner of Corporations, any national
securities exchange upon which the Common Stock of the Company may be listed
and any other regulatory agency having jurisdiction have been fully complied
with.


 


13.          Dispute Resolution. If
a dispute arises between Optionee and Company in connection with the Stock
Option award or the vesting or exercise of the Stock Options, the dispute will
be resolved by binding arbitration with the American Arbitration Association
(AAA) in accordance with the AAA’s Commercial Arbitration Rules then in effect.


 


14.          Binding Effect. This
Agreement will bind and inure to the benefit of the Company and its successors
and assigns, and Optionee and any heir, executor or administrator of Optionee
as permitted by subparagraph 5.4.


 


15.          Governing Law. This
Agreement shall be governed by, and construed in accordance with, the laws of
the State of California.


 


IN
WITNESS WHEREOF, the parties have executed the Agreement as
of the date and year written above.


 


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  CITY NATIONAL CORPORATION,

  	
   

  
	
   

  	
   

  	
  a Delaware corporation

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Christopher J. Carey

  	
   

  
	
   

  	
   

  	
  Christopher J. Carey,
  Executive Vice

  	
   

  
	
   

  	
   

  	
  President, Chief
  Financial Officer

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Optionee

  	
   

  



 


PLEASE RETURN ONE COPY OF THE SIGNED AGREEMENT TO
THE COMPENSATION SECTION OF HUMAN RESOURCES (86-001)


 


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