Document:

Exhibit 10.1

UNION BANK OF CALIFORNIA,
N.A.

SEPARATION PAY PLAN

(Effective
September 1, 2006)

	
  ARTICLE I. DEFINITIONS

  	
   

  	
  1

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1.1

  	
   

  	
  “Administrative Committee”

  	
   

  	
  1

  
	
  1.2

  	
   

  	
  “Affiliated Group”

  	
   

  	
  1

  
	
  1.3

  	
   

  	
  “Base Pay”

  	
   

  	
  1

  
	
  1.4

  	
   

  	
  “Code”

  	
   

  	
  2

  
	
  1.5

  	
   

  	
  “Comparable Position”

  	
   

  	
  2

  
	
  1.6

  	
   

  	
  “Eligible Employee”

  	
   

  	
  2

  
	
  1.7

  	
   

  	
  “Employer”

  	
   

  	
  4

  
	
  1.8

  	
   

  	
  “Employment”

  	
   

  	
  4

  
	
  1.9

  	
   

  	
  “ERISA”

  	
   

  	
  4

  
	
  1.10

  	
   

  	
  “Guaranteed Reinstatement Period”

  	
   

  	
  4

  
	
  1.11

  	
   

  	
  “Job Elimination”

  	
   

  	
  4

  
	
  1.12

  	
   

  	
  “Non-Benefits Eligible Employee”

  	
   

  	
  5

  
	
  1.13

  	
   

  	
  “Participant”

  	
   

  	
  5

  
	
  1.14

  	
   

  	
  “Participating Employer”

  	
   

  	
  5

  
	
  1.15

  	
   

  	
  “Plan”

  	
   

  	
  6

  
	
  1.16

  	
   

  	
  “Plan Year”

  	
   

  	
  6

  
	
  1.17

  	
   

  	
  “Retirement Benefits”

  	
   

  	
  6

  
	
  1.18

  	
   

  	
  “Retirement Eligible Participant”

  	
   

  	
  6

  
	
  1.19

  	
   

  	
  “Separation Pay”

  	
   

  	
  6

  
	
  1.20

  	
   

  	
  “Separation Pay Allowance”

  	
   

  	
  6

  
	
  1.21

  	
   

  	
  “Termination Date”

  	
   

  	
  6

  
	
  1.22

  	
   

  	
  “Year of Service”

  	
   

  	
  6

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE II. PARTICIPATION

  	
   

  	
  7

  
	
   

  	
   

  	
   

  
	
  2.1

  	
   

  	
  Participation

  	
   

  	
  7

  

 

 

	
  2.2

  	
   

  	
  Persons Who Shall Not Participate

  	
   

  	
  7

  
	
  2.3

  	
   

  	
  Settlement and Release Agreement

  	
   

  	
  9

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE III. SEPARATION BENEFITS

  	
   

  	
  9

  
	
   

  	
   

  	
   

  
	
  3.1

  	
   

  	
  Separation Pay Allowance

  	
   

  	
  9

  
	
  3.2

  	
   

  	
  Payment of Separation Pay Allowance

  	
   

  	
  10

  
	
  3.3

  	
   

  	
  Interest

  	
   

  	
  10

  
	
  3.4

  	
   

  	
  Deductions

  	
   

  	
  10

  
	
  3.5

  	
   

  	
  Repayment or Forfeiture of Separation Pay Allowance

  	
   

  	
  10

  
	
  3.6

  	
   

  	
  Effect of the Participant’s Leave of Absence

  	
   

  	
  10

  
	
  3.7

  	
   

  	
  Effect of the Participant’s Commencement of
  Retirement Benefits

  	
   

  	
  12

  
	
  3.8

  	
   

  	
  Effect of the Participant’s Death

  	
   

  	
  12

  
	
  3.9

  	
   

  	
  Limitation on Separation Pay

  	
   

  	
  12

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE IV. WELFARE BENEFITS

  	
   

  	
  13

  
	
   

  	
   

  	
   

  
	
  4.1

  	
   

  	
  Continuation of Coverage

  	
   

  	
  13

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE V. SOURCE OF PAYMENTS AND EXPENSES

  	
   

  	
  13

  
	
   

  	
   

  	
   

  
	
  5.1

  	
   

  	
  Source of Payments

  	
   

  	
  13

  
	
  5.2

  	
   

  	
  Expenses

  	
   

  	
  13

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VI. ADMINISTRATION AND PLAN FIDUCIARIES

  	
   

  	
  13

  
	
   

  	
   

  	
   

  
	
  6.1

  	
   

  	
  Plan Sponsor

  	
   

  	
  13

  
	
  6.2

  	
   

  	
  Plan Administrator

  	
   

  	
  13

  
	
  6.3

  	
   

  	
  Administrative Responsibility

  	
   

  	
  14

  
	
  6.4

  	
   

  	
  Review of Denied Claims

  	
   

  	
  14

  
	
  6.5

  	
   

  	
  Named Fiduciaries

  	
   

  	
  14

  
	
  6.6

  	
   

  	
  Allocation and Delegation of Responsibilities

  	
   

  	
  14

  
	
  6.7

  	
   

  	
  Indemnification

  	
   

  	
  15

  

 

 ii
 

 

	
  ARTICLE VII. CLAIMS AND APPEALS

  	
   

  	
  15

  
	
   

  	
   

  	
   

  
	
  7.1

  	
   

  	
  Claims for Benefits

  	
   

  	
  15

  
	
  7.2

  	
   

  	
  Review of Denied Claims

  	
   

  	
  16

  
	
  7.3

  	
   

  	
  Exhaustion of Remedies

  	
   

  	
  18

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE VIII. GENERAL PROVISIONS

  	
   

  	
  18

  
	
   

  	
   

  	
   

  
	
  8.1

  	
   

  	
  Legal Construction of the Plan

  	
   

  	
  18

  
	
  8.2

  	
   

  	
  No Rights Created or Accrued

  	
   

  	
  19

  
	
  8.3

  	
   

  	
  Benefits Not Contingent Upon Retirement

  	
   

  	
  19

  
	
  8.4

  	
   

  	
  Relation of the Plan to Descriptive Matter

  	
   

  	
  19

  
	
  8.5

  	
   

  	
  Nonalienation of Benefits

  	
   

  	
  19

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE IX. AMENDMENT, SUSPENSION AND TERMINATION

  	
   

  	
  20

  
	
   

  	
   

  	
   

  
	
  9.1

  	
   

  	
  Amendment, Suspension and Termination

  	
   

  	
  20

  
	
  9.2

  	
   

  	
  Participating Employer Withdrawal

  	
   

  	
  20

  
	
  9.3

  	
   

  	
  Effect of Amendment, Suspension, Termination or
  Withdrawal

  	
   

  	
  20

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  ARTICLE X. EXECUTION

  	
   

  	
  20

  

 

 iii

UNION BANK OF CALIFORNIA,
N.A.

SEPARATION
PAY PLAN

INTRODUCTION

The Union Bank of
California, N.A. Separation Pay Plan (the “Plan”) was established to provide
severance benefits to Eligible Employees who become Participants in the
Plan.  The Plan is intended to be, and
shall be maintained and operated as, an employee welfare benefit plan under
ERISA.

The Plan is
effective as of September 1, 2006. 
The Plan supersedes any plan, program or practice previously in effect,
with respect to a Participating Employer other than any written employment
contract or separate severance agreement that expressly provides such benefits
and the Union Bank of California, N.A. Termination Pay Plan (the “Basic Plan”).

ARTICLE
I.

DEFINITIONS

When used in this
Plan, the following capitalized words and phrases shall have the following
meanings, unless the context clearly indicates otherwise.

1.1           “Administrative
Committee” means the Employee Deferred Compensation and Benefit Plans
Administrative Committee appointed by the Employer to exercise the duties and
responsibilities of plan administrator in accordance with Article VI.

1.2           “Affiliated Group”
means the Employer, each Participating Employer and any other direct or
indirect subsidiary or affiliate of the Employer or a Participating Employer.

1.3           “Base Pay”
means an Eligible Employee’s base rate of pay with the Participating Employer
and includes shift differentials.  Base
Pay does not include any other special payment, 

 1
 

such
as overtime, bonuses or expense reimbursements. 
With respect to an Eligible Employee the primary component of whose Base
Pay is commission-based under a variable pay plan, Base Pay shall be the
Eligible Employee’s adjusted Base Pay, determined in accordance with the
written procedures of the Employer.

1.4           “Code” means
the Internal Revenue Code of 1986, as amended, and includes regulations
promulgated thereunder by the Secretary of Treasury.

1.5           “Comparable
Position” means a job involving the use of generally similar
skills in the performance of the functions of the position and having generally
similar responsibilities with any member of the Affiliated Group or an employer
described in Section 2.2(g), provided that the salary of full-time employees in
such job would be at least 90% of his or her Base Pay immediately prior to the
Termination Date, and the scheduled hours of part-time employees would be at
least 80% of his or her scheduled hours immediately prior to the Termination
Date and that the location of the job is within a 35-mile radius of the person’s
residence or results in a greater commuting distance if the person’s commute
from his or her residence immediately prior to the Termination Date exceeds 35
miles.  Notwithstanding any other
provision of this Plan to the contrary, the determination as to whether a
position is a Comparable Position under this Section 1.5 shall be made by
the Employer in its sole discretion.

1.6           “Eligible
Employee” means a regular employee of a Participating Employer
scheduled to work at least 171⁄2 hours each week in a position designated by the
Employer as benefits-eligible, and whose job performance meets the minimum job
performance criteria established by the Participating Employer, as determined
by the Participating Employer in its sole discretion.  Notwithstanding the preceding sentence, the
following employees shall not be Eligible Employees under any circumstances:

 2
 

(a)           Any person who is
classified by the Participating Employer as a Non-Benefits Eligible Employee;

(b)           Any person who performs
services for the Participating Employer as an independent contractor or as a
leased employee (within the meaning of section 414(n) of the Code);

(c)           Any person who has not
completed three (3) months of service with the Participating Employer as
of the date he or she is provided notice of termination under
Section 2.1(a);

(d)           Any person who is a
nonresident alien and provides temporary services to a Participating Employer
on an intra-company transfer visa or a similar visa classification; and

(e)           Any
person who is a party to a written employment contract with a Participating
Employer expressly providing such person with severance benefits; and

(f)            Any
person who is a participant in or who may be eligible to receive severance
benefits under any other severance plan or arrangement established by a
Participating Employer.

The
term Eligible Employee includes an employee on an approved leave of absence for
which the Participating Employer’s leave of absence policy provides for
guaranteed reinstatement of employment to such employee’s prior position or an
equivalent position, and if such employee is not described in (a), (b),
(c),(d), (e) or (f).  The term Eligible
Employee shall not include any individual whose compensation from a
Participating Employer is reported on Form 1099 or who performs services
for a Participating Employer pursuant to an agreement between the Participating
Employer and a third party leasing or professional employment organization,

 3
 

staffing
firm or other similar third party organization. 
Individuals not classified as employees on the payroll records of a
Participating Employer for a particular period shall not be considered Eligible
Employees for the period even if a court or administrative agency determines
that such individuals are or were employees of a Participating Employer during
such period for purposes of payroll taxes, labor or employment law or any other
non-Plan purpose.

1.7           “Employer”
means Union Bank of California, N.A., a national banking association, or any
successor thereof.

1.8           “Employment”
means employment with any member of the Affiliated Group.

1.9           “ERISA”
means the Employee Retirement Income Security Act of 1974, as amended, and
includes regulations promulgated thereunder by the Secretary of Labor.

1.10         “Guaranteed
Reinstatement Period” means the period of time during which an
Eligible Employee is guaranteed reinstatement to his or her prior position or
an equivalent position in accordance with the Participating Employer’s written
leave of absence policies.

1.11         “Job
Elimination” means, with respect to an Eligible Employee a
termination of employment with the Participating Employer resulting from
restructure or elimination of the employee’s group, division, department,
branch or position because of any one of the following events, as determined by
the Employer in its sole discretion:

(a)           the sale of stock or
assets of the Participating Employer;

(b)           the internal
reorganization of the operations of the Participating Employer;

(c)           a change in technology
used by or in the business conducted by the Participating Employer; or

(d)           a
reduced work volume.

 4
 

1.12         “Non-Benefits
Eligible Employee” means an employee of a Participating Employer
scheduled to work less than 171⁄2 hours each week in a position designated by the
Employer in its sole discretion as non-benefits eligible and who is not
eligible under the Participating Employer’s policies to participate in the
health and welfare and retirement benefit plans of the Participating
Employer.  For purposes of this Plan,
Non-Benefits Eligible Employee shall also include an employee who is a
temporary employee or who performs services for a Participating Employer as a
term employee without regard to the number of hours he or she is scheduled to
work each week or whether he or she participates in the Participating Employer’s
health and welfare and retirement benefit plans.

1.13         “Participant”
means an Eligible Employee who participates in the Plan pursuant to
Article II.

1.14         “Participating
Employer” means, with respect to an Eligible Employee, the
Participating Employer with which he or she is employed.  The Participating Employers include the
Employer and any subsidiary or affiliate of the Employer which has been
designated by the Employer as a Participating Employer and whose board or other
governing body also has adopted the Plan. 
An entity that becomes a Participating Employer after the Effective Date
shall only be treated as a Participating Employer as of that later date.  As of the date on which any subsidiary or
affiliate of the Employer becomes a Participating Employer after the Effective
Date, this Plan shall supersede any plan, program or practice under which such
Participating Employer may have provided severance benefits prior to the
effective date of its adoption of this Plan, other than any written employment
contract or separate severance agreement that expressly provides for such
benefits and other than the Basic Plan.

 5
 

1.15         “Plan”
means the Union Bank of California, N.A. Separation Pay Plan, as set forth
herein and as amended from time to time hereafter.

1.16         “Plan
Year” means the calendar year, except that the first Plan Year
shall be the short Plan Year commencing on the Effective Date and ending
December 31, 2006.

1.17         “Retirement
Benefits” means those benefits available to a Participant on
account of the Participant’s participation in a qualified defined benefit
retirement plan and/or a nonqualified supplemental defined benefit retirement
plan of a Participating Employer.

1.18         “Retirement
Eligible Participant” means a Participant who is eligible or
becomes eligible to commence receiving Retirement Benefits during any time
period when the Participant is receiving Separation Pay.

1.19         “Separation
Pay” means amounts payable under the Plan to a Participant on
account of termination of his or her Employment under the conditions described
in Article II.

1.20         “Separation
Pay Allowance” means the total amount of Separation Pay that a
Participant may receive under the Plan.

1.21         “Termination
Date” means, with respect to an Eligible Employee, the date
selected by the Participating Employer on which the Eligible Employee’s
employment with the Participating Employer is to cease.  An Eligible Employee’s Termination Date shall
be at least 60 days from the date on which notice is given under
Section 2.1(a).

1.22         “Year
of Service” means each complete 12-consecutive months of service
with the Participating Employer in the period elapsed from the Participant’s
first day of employment to his or her Termination Date, including any period of
approved leave of absence, as determined by the Employer in its sole
discretion.  Service prior to a break in
service shall not be added to service after the break in service in determining
a Participant’s Years of Service.  For
this 

 6
 

purpose,
a Participant experienced a break in service if he or she previously resigned
or otherwise terminated employment with a Participating Employer or was
terminated by a Participating Employer for any reason, and later was
re-employed by a Participating Employer. 
A break in service is measured from the date of termination to the day
the Participant is re-employed.

ARTICLE
II.

PARTICIPATION

2.1 Participation.  An Eligible Employee shall become a
Participant in the Plan if:

(a)           The Participating
Employer provides a written notice to the Eligible Employee notifying him or
her that his or her Employment is to be terminated on account of Job
Elimination and setting the Eligible Employee’s Termination Date for purposes
of this Plan;

(b)           The Eligible Employee
voluntarily elects in writing to participate in this Plan (thereby waiving
participation in the Basic Plan) by executing the “Settlement and Release
Agreement” required under Section 2.3 prior to his or her Termination
Date;

(c)           The Eligible Employee’s
job performance continues to meet the minimum job performance criteria
established by the Participating Employer in its sole discretion until his or
her Termination Date; and

(d)           The Eligible Employee
actually terminates his or her Employment as of the Termination Date, or
becomes a Participant in accordance with Section 3.7.

2.2 Persons Who Shall Not Participate.  Notwithstanding any contrary provision of
this Plan, an Eligible Employee shall not become a Participant and shall not be
eligible for Separation Pay if he or she:

 7
 

(a)           Is terminated due to
poor performance, dishonesty or other misconduct, or failure to comply with the
law or with the policies of the Participating Employer;

(b)           Is terminated for any
reason other than Job Elimination;

(c)           Is on a leave of
absence without a Guaranteed Reinstatement Period or has exceeded the
Guaranteed Reinstatement Period;

(d)           Is a participant in the
Basic Plan or has an employment or separate severance agreement with the
Participating Employer providing for termination pay benefits;

(e)           Is a participant in any
other severance plan or arrangement established by a Participating Employer;

(f)            Is offered continued
employment with the Affiliated Group in a Comparable Position to the one held
by the Eligible Employee immediately prior to his or her Termination Date or
declines an interview for such a Comparable Position; or

(g)           Is terminated as a
result of the acquisition, sale or spin-off of the Participating Employer or
any facility or branch of the Participating Employer and is offered employment
in a Comparable Position with the purchaser or other surviving entity within 90
days of the sale or spin-off.  If an
Eligible Employee initially became a Participant and received Separation Pay
during such 90 day period (because the purchaser or the surviving entity
did not offer employment in a Comparable Position) and later the Eligible
Employee is offered employment in a Comparable Position or becomes  employed in a Comparable Position within such
90 day period, the forfeiture and repayment provisions of Section 3.5
shall apply.

 8
 

2.3 Settlement and Release Agreement.  Each Eligible Employee shall execute a “Settlement
and Release Agreement” as a condition of participation in the Plan.  An Eligible Employee shall not become a
Participant and shall not be eligible for Separation Pay under this Plan unless
he or she properly completes and executes the Settlement and Release Agreement
in exactly the form provided to the Eligible Employee by the Employer, without
altering or adding to the Settlement and Release Agreement in any way, and he
or she does not revoke or rescind the Settlement and Release Agreement.  The Settlement and Release Agreement shall
provide that execution of such Settlement and Release Agreement by the Eligible
Employee will constitute a waiver and release of every claim the Eligible
Employee might otherwise have arising out of his or her employment or the
termination of his or her employment.  If
an Eligible Employee fails to execute the Settlement and Release Agreement by
his or her Termination Date, or executes but later revokes or rescinds the
Settlement and Release Agreement, such Eligible Employee shall fail to qualify
as a Participant under the Plan.

ARTICLE
III.

SEPARATION
BENEFITS

3.1 Separation Pay Allowance.  Upon termination of Employment, a Participant
shall be eligible to receive a Separation Pay Allowance equal to the amount
designated for his or her job classification on the Benefits Exhibit, for his
or her status as an exempt or nonexempt employee; and for exempt employees
further based on salary and corporate title. 
The Participant’s job classification is the classification he or she
held immediately prior to the notice of the Termination Date.  The Employer reserves the right to alter,
reduce or eliminate this formula, in whole or in part, pursuant to Section 9.1.

 9
 

3.2 Payment of Separation Pay Allowance.  The normal form of payment of a Participant’s
Separation Pay Allowance shall be as salary continuation on the same bi-weekly
basis as the Participant’s salary was paid immediately prior to the Termination
Date or such other pay period basis as the Participating Employer implements
with respect to active employees. 
Notwithstanding the preceding sentence, an Eligible Employee who becomes
a Participant as described in Section 3.6 may receive payment of some or
all of his or her Separation Pay Allowance as a lump sum in accordance with
Section 3.6.

3.3 Interest.  No interest shall accrue or be paid with
respect to any portion of the Participant’s Separation Pay Allowance.

3.4 Deductions.  The Participating Employer will make such
deductions from the Participant’s Separation Pay Allowance as required to cover
withholding taxes and the voluntary deductions covering any employee benefits
that are continued, in the sole discretion of the Participating Employer,
during the salary continuation period.

3.5 Repayment or Forfeiture of Separation Pay Allowance.  If a Participant is reemployed with a member
of the Affiliated Group as described in Section 2.2(f), or if, as described in
Section 2.2(g), a Participant is offered employment or becomes employed with
the purchaser prior to the end of the salary continuation period, such
Participant shall be required to repay or forfeit (as applicable) to the
Participating Employer a pro-rata amount of such Separation Pay Allowance, as
established by the Employer in its sole discretion.

3.6 Effect of the Participant’s Leave of Absence.  The Termination Date of an Eligible Employee
who commences a leave of absence approved by the Participating Employer and in
accordance with the Participating Employer’s written leave of absence policies
after being given notice under Section 2.1(a) will be the later of 60 days
from the date specified in such notice, the 

 10
 

date he or she returns from leave, or such other date
as determined in accordance with the Participating Employer’s written leave of
absence policies.  In the case of an
Eligible Employee on a leave of absence described in the foregoing sentence, he
or she shall become a Participant as of the first day following the Termination
Date, and he or she shall receive Separation Pay equal to the amount designated
for his or her job classification on the Benefits Exhibit reduced by any pay
received by the Participant after the date he or she becomes a Participant and
determined in accordance with the Participating Employer’s written leave of
absence policies, so that the aggregate pay received by such Participant does
not exceed the Separation Pay amount. 
Separation Pay provided under this Section 3.6 shall be paid in the
form of a lump sum payment, Separation Pay Allowance, or a combination of both,
as determined in accordance with procedures established by the Employer.

An Eligible
Employee who commences a leave of absence approved by the Participating
Employer and in accordance with the Participating Employer’s written leave of
absence policies prior to receiving notice under Section 2.1(a) but who
returns within his or her Guaranteed Reinstatement Period shall be provided
notice under Section 2.1(a) as soon as administratively practicable
following the date he or she return to employment with the Participating
Employer.  If such Eligible Employee
becomes a Participant as provided in Section 2.1, he or she shall receive
Separation Pay equal to the amount designated for his or her job classification
on the Benefits Exhibit.

An Eligible
Employee who commences a leave of absence approved by the Participating
Employer and in accordance with the Participating Employer’s written leave of
absence policies prior to receiving notice under Section 2.1(a), but who
is not eligible for a Guaranteed 

 11
 

Reinstatement
Period or who returns after his or her Guaranteed Reinstatement Period, shall
no longer be an Eligible Employee and shall not become a Participant as
provided in Section 2.2(c).

3.7 Effect of the Participant’s Commencement of
Retirement Benefits. 
If a Participant who also is a Retirement Eligible Participant receives
Retirement Benefits during any time period when the Participant also is
receiving Separation Pay, the Participant’s Separation Pay shall be reduced by
the amount of the Retirement Benefits received by the Participant during such
time period, so that the aggregate pay received by such Participant does not
exceed the Separation Pay Allowance.

3.8 Effect of the Participant’s Death.  If a Participant dies before he or she
receives the entire balance of his or her Separation Pay Allowance, any unpaid
balance of such Separation Pay Allowance shall be paid to the Participant’s
spouse or domestic partner if then living or, if not (or none), to the Participant’s
then living children in equal shares or, if none, to the Participant’s estate.[

3.9 Limitation on Separation Pay.  Nothing in this Article III shall
require a Participating Employer to make a payment under this Plan, if such
payment either alone or in the aggregate with other payments to the Participant
from the Participating Employer (or any other Affiliated Group member) would be
nondeductible to the Participating Employer for purposes of federal income
taxes under section 280G of the Code or otherwise.  Any such payment or portion of a payment that
the Employer in its sole discretion determines is nondeductible shall be
forfeited by the Participant, and, if already paid, it shall be returned to
Participating Employer by the Participant.

 12
 

ARTICLE IV.

WELFARE
BENEFITS

4.1 Continuation of Coverage.  If a Participant is covered by medical,
dental or vision insurance on his or her Termination Date, the Participating
Employer, in its sole discretion, may elect to continue employer contributions
toward such coverage for a period to be determined by the Participating
Employer.  Any such coverage shall not be
counted as part of the period of the continuation coverage required by section
4980B(f) of the Code and section 602 of ERISA.  If the Participating Employer does not elect
to continue employer contributions, or discontinues employer contributions, the
Participant may purchase such coverage, at his or her own expense, during the
period for which continuation coverage is required to be offered under section
4980B(f) of the Code or section 602 of ERISA.

ARTICLE
V.

SOURCE OF
PAYMENTS AND EXPENSES

5.1 Source of Payments.  Any benefits payable under the Plan shall be
unfunded and shall be payable only from the general assets of the Participating
Employers.

5.2 Expenses.  The expenses of operating and administering
the Plan shall be borne entirely by the Participating Employers.

ARTICLE
VI.

ADMINISTRATION
AND PLAN FIDUCIARIES

6.1 Plan Sponsor.  The Employer is the “plan sponsor” within the
meaning of ERISA.

6.2 Plan Administrator.  The Administrative Committee is the “administrator”
of the Plan (the “Plan Administrator”) within the meaning of ERISA.

 13
 

6.3 Administrative Responsibility.  The Plan Administrator shall be the named
fiduciary with the power and sole discretion to determine who is eligible for
benefits under the Plan, to interpret the Plan and to prescribe such forms,
make such rules, regulations, interpretations and computations and prescribe
such guidelines as it may determine are necessary or appropriate for the
operation and administration of the Plan, to change the terms of such rules,
regulations or guidelines, and to rescind such rules, regulations or
guidelines.  Such determinations of
eligibility, rules, regulations, interpretations, computations and guidelines
shall be conclusive and binding upon all persons.

6.4 Review of Denied Claims.  The Plan Administrator shall have the
discretionary authority to review an appeal from a denial of benefits under the
Plan in accordance with Section 7.2. 
The Plan Administrator shall determine conclusively for all parties all
questions arising with respect to an appeal from a denial of benefits under the
Plan, and any decision of the Plan Administrator shall not be subject to
further review.

6.5 Named Fiduciaries.  The Plan Administrator is the “named
fiduciary” of the Plan within the meaning of ERISA.

6.6 Allocation and Delegation of Responsibilities.  The Plan Administrator may allocate any of
its responsibilities for the operation and administration of the Plan among the
officers, employees and agents of the Participating Employers.  It may also delegate any of its
responsibilities under the Plan by designating, in writing, another person to
carry out such responsibilities.  Any
such written delegation shall become effective when executed by the Plan
Administrator, and the designated person shall then be responsible for carrying
out the responsibilities described in such writing.

 14
 

6.7 Indemnification.  To the extent permitted by law, the
applicable Participating Employer shall, and hereby does, indemnify and hold
harmless the members of the Board of Directors of the Participating Employer,
the officers of the Participating Employer, the members of the Administrative
Committee as Plan Administrator, and any other employees or representative of
the Participating Employer who may be deemed to be fiduciaries of the Plan,
from and against any and all losses, claims, damages or liabilities (including
attorney’s fees and amounts paid, with the approval of the Board of Directors
of the Employer, in settlement of any claim) arising out of or resulting from
the implementation of a duty, act or decision with respect to the Plan, so long
as such duty, act or decision does not involve gross negligence or willful
misconduct on the part of any such individual. 
Any individual person so indemnified shall, within 60 days after
receipt of notice of any action, suit or proceeding, notify the Employer and
offer in writing to the Employer the opportunity at its own expense, to handle
and defend such action, suit or proceeding, and the Employer shall have the
right, but not the obligation, to conduct the defense in any such action, suit
or proceeding.  Failure to give the
Employer such notice shall relieve the Employer of any liability under this
Section 6.7.  The Participating Employers
may satisfy their obligations under this provision (in whole or in part) by the
purchase of a policy or policies of insurance.

ARTICLE
VII.

CLAIMS
AND APPEALS

7.1 Claims for Benefits.  Any claimant (or his or her authorized
representative) who believes himself or herself to be entitled to receive
benefits under the Plan, or benefits that are different from the benefits that
he or she has received, may submit a claim for such benefits by writing to the
Director of Human Resources of the Employer (the “Claims Reviewer”).

 15
 

(a)           Time
Limits for Submission of Initial Claim.  No claim shall be valid unless it is
submitted within 90 days following the receipt of any disputed benefit.

(b)           Time
Limits for Decision on Initial Claim.  If any claim is denied, in whole or in part,
written notice of such denial shall be given to the claimant within 90 days,
except that, if special circumstances require that the time for consideration
of the claim be extended, notice of the extension shall be given in writing
within 90 days, and notice of such denial shall thereafter be given within 180
days.  Each period of 90 or 180 days
referred to in the preceding sentence shall begin to run on the day the claim
is received by the Claims Reviewer.  A
written notice of denial shall set forth, in a manner calculated to be
understood by the claimant, specific reasons for the denial, specific
references to the Plan provisions on which it is based, a description of any
information or material necessary to perfect the claim and an explanation of
why such material is necessary, an explanation of the Plan’s review procedure
and a statement regarding the claimant’s right to bring a civil action under
section 502(a) of ERISA following the denial of an appeal under
Section 7.2.  A notice that
additional time is necessary for consideration of a claim shall indicate the
special circumstances requiring the extension of time and the date by which the
Claims Reviewer expects to render his or her decision on the claim.

7.2 Review of Denied Claims.  Whenever a claim for benefits has been
denied, in whole or in part, pursuant to Section 7.1, the claimant shall
have the right to request a full and fair review of the claim and denial by
submitting a written request for review to the Plan Administrator, at the
following address:  “Plan Administrator,
Union Bank of California, N.A. Separation Pay Plan, c/o Director of Human
Resources, Union Bank of California, N.A., 400 California Street, San
Francisco, California 94104.”  A request
for review shall set forth all of 

 16
 

the
grounds on which it is based, all facts in support of the request and any other
matters that the claimant deems pertinent. 
The Plan Administrator may require the claimant to submit such
additional facts, documents or other material it may deem necessary or
appropriate in making its review.  The
claimant may submit written comments, documents, records and other information
related to the benefit claim on appeal. 
The claimant must be provided, upon request and free of charge,
reasonable access to and copies of all documents, records and other information
relevant to the benefit claim that are not privileged.  A document is considered relevant to the
claim if it (i) was relied upon in making the benefit determination; (ii) was
submitted, considered or generated in the course of making the benefit
determination, without regard as to whether it was relied upon making the
decision; or (iii) demonstrates compliance in making the benefit decision with
the requirement that the benefit determination must follow the terms of the
Plan and be consistent when applied to similarly situated claimants.

(a)           Time
Limits for Submission of Request for Review.  The Plan Administrator shall have no
obligation to provide a review of any claim that has been denied under
Section 7.1, unless a written request for review is submitted within 90
days following the initial denial.

(b)           Decision
on Review.  If the
Plan Administrator affirms the denial of a claim, in whole or in part, it shall
give written notice of its decision to the claimant within 60 days, except
that, if special circumstances require that the time for consideration of the
request for review be extended, notice of the extension shall be given in
writing within 60 days, and notice of such decision shall be given within
120 days.  This notice of extension
shall indicate the special circumstances requiring the extension of time and
the date by which the Plan Administrator expects to render its decision on the
application for benefits.  Each period of
60 or 

 17
 

120 days
referred to in this paragraph shall begin to run on the day the claim is
received by the Plan Administrator.  A
written notice affirming the denial of a claim shall set forth, in a manner
calculated to be understood by the claimant, the specific reasons for the
denial, specific references to the Plan provisions on which it is based, a
statement that the claimant is entitled to receive, upon request and free of
charge, reasonable access to and copies of all documents, records and other
information relevant to the benefit claim and a statement regarding the
claimant’s right to bring a civil action under section 502(a) of ERISA
following the denial of the appeal.  A
document is considered relevant to the claim if it (i) was relied upon in
making the benefit determination; (ii) was submitted, considered or generated
in the course of making the benefit determination, without regard as to whether
it was relied upon making the decision; or (iii) demonstrates compliance in
making the benefit decision with the requirement that the benefit determination
must follow the terms of the Plan and be consistent when applied to similarly
situated claimants, and a statement regarding the claimant’s right to bring a
civil action under section 502(a) of ERISA following the denial of the
appeal.

7.3 Exhaustion of Remedies.  No legal action for benefits under the Plan
shall be brought unless and until the claimant (i) has submitted a written
claim in accordance with this Section 7.1(a), (ii) has been notified that
the claim is denied, (iii) has filed a written request for review of the
claim in accordance with Section 7.2, and (iv) has been notified in
writing that the Plan Administrator has affirmed the denial of the claim.

ARTICLE
VIII.

GENERAL
PROVISIONS

8.1 Legal Construction of the Plan.  The Plan shall be governed and construed in
accordance with ERISA.

 18
 

8.2 No Rights Created or Accrued.  Nothing in the Plan shall be construed as
giving to an employee of any Participating Employer a right to receive any
benefit other than the benefits specifically provided under the terms of the
Plan.  Nothing in the Plan shall be
construed to limit in any manner the right of any Participating Employer to
discharge, demote, downgrade, transfer, relocate, or in any other manner treat
or deal with any person in its employ, without regard to the effect such
treatment or dealing may have upon such person as someone who might otherwise
have become (or remained) a Participant in the Plan, which right is hereby
reserved.  No benefits shall be deemed to
accrue under the Plan at any time except the time at which they become payable
under the Plan, no right to a benefit under the Plan shall be deemed to vest
prior to the Participant’s Termination Date, and any vested benefit is subject
to such forfeiture conditions established by the Employer in its sole
discretion under this Plan or pursuant to written guidelines.

8.3 Benefits Not Contingent Upon Retirement.  No right to a benefit under the Plan shall
depend (or shall be deemed to depend) upon whether a Participant retires or
elects to receive retirement benefits under the terms of any employee pension
benefit plan.

8.4 Relation of the Plan to Descriptive Matter.  The Plan shall contain no terms or provisions
except those set forth herein, or as hereafter amended in accordance with the
provisions of Article IX.  If any
description made in any other document is deemed to be in conflict with any
provision of the Plan, the provisions of the Plan shall control.

8.5 Nonalienation of Benefits.  No benefits payable under the Plan shall be
subject to anticipation, alienation, sale, transfer, assignment, pledge or
other encumbrance, and any attempt to do so shall be void and unenforceable.

 19
 

ARTICLE
IX.

AMENDMENT,
SUSPENSION AND TERMINATION

9.1 Amendment, Suspension and Termination.  The Employer reserves the right to amend,
suspend or terminate the Plan, in whole or in part, and for any reason by
action of its Board of Directors.

9.2 Participating Employer Withdrawal.  Each Participating Employer may withdraw its
participation in the Plan by action of its board of directors and, as of
withdrawal date set by the board of directors, the employees of the
Participating Employer shall not be Eligible Employees under the Plan.

9.3 Effect of Amendment, Suspension, Termination or
Withdrawal.  If a
Participant’s Termination Date has occurred and the Participant is entitled to
receive benefits under the Plan, no amendment to the Plan, no suspension of the
Plan, no termination of the Plan, and no withdrawal from the Plan shall
thereafter operate to diminish or eliminate such Participant’s entitlement to
such benefits.

ARTICLE
X.

EXECUTION

To
record the adoption of the Plan, the Director of Human Resources of the
Employer has executed this document on this 24th day of July, 2006.

	
  

  	
  UNION BANK OF CALIFORNIA, N.A.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
  By

  	
  /s/ Paul E.
  Fearer

  	
   

  
	
   

  	
   

  	
  Paul E. Fearer,
  Executive Vice President

  
	
   

  	
   

  	
  Director of
  Human Resources

  

 

 20

SEPARATION PAY PLAN
(ENHANCED PLAN)

BENEFITS
EXHIBIT

POLICY MAKING OFFICER LEVEL:

POLICY
MAKING OFFICER LEVEL

All Policy-Making
Officers will be eligible to receive 104 weeks of Salary Continuation
regardless of number of years of service

ADDITIONAL BENEFITS FOR
POLICY MAKING OFFICERS

Policy Making
Officers may receive a pro rata share of incentive or bonus pay for which they
normally would have been eligible, but only for services performed up to the
Termination Date and for that calendar year. 
For example, if a Policy Making Officer participates in a departmental
incentive pay plan and his/her Termination Date falls on October 31 of the
applicable calendar year, he/she shall be eligible for a prorated incentive
payment of 10/12 of the individual amount which could have been awarded under
the incentive plan for that calendar year, in the absence of a termination of
employment.

In addition, for
Policy Making Officers who are participants in an incentive pay plan, or the
Senior Management Bonus Plan, an amount of 1/52 of the average of the last 3
annual bonuses/payments the employee actually received, will be added to the
employee’s weekly base pay for each week the employee receives salary
continuation.  For those affected
employees who have actually received bonuses/payments for fewer than the three
years, an average will be calculated for the number of years they have actually
received a bonus/payment, and then 1/52 of this amount will be added to the
base pay to calculate the amount of weekly salary continuation.  For example, if a Policy Making Officer
received bonuses over the last three years of $10,000, $5,000 and $15,000, the
average bonus for that period is $10,000. 
This number is then divided by 52 (weeks) to arrive at the amount to be
added to the weekly base pay for the employee. 
However, in no instance will the bonus average used to calculate the
amount to be added to base pay on a pro-rated basis exceed 100% of annual base
pay.

 A-1Exhibit 10.1

 

Summary of the Avaya Inc. Non-Employee Director
Compensation Program

(as of
February 2007)

Below is a summary of the amounts payable to
non-employee Directors of Avaya Inc. (the “Company”) in connection with their
service on the Company’s Board of Directors (the “Board”).

Annual Retainers

Annual retainers are payable as of March 1 of
each fiscal year as follows:

·                  All
non-employee Directors receive an annual cash retainer of $70,000.

·                  All
non-employee Directors receive an annual equity retainer valued at $120,000.

·                  A
non-employee Director who serves on a Board committee receives the following
additional annual retainers:

	
  Board Committee

  	
   

  	
  Committee Member

  	
   

  	
  Committee Chairperson

  (Retainer is Incremental to

  Committee Member Retainer)

  	
   

  
	
  Audit

  	
   

  	
  $

  	
  10,000

  	
   

  	
  $

  	
  20,000

  	
   

  
	
  Compensation

  	
   

  	
  $

  	
  5,000

  	
   

  	
  $

  	
  10,000

  	
   

  
	
  Finance

  	
   

  	
  $

  	
  2,500

  	
   

  	
  $

  	
  5,000

  	
   

  
	
  Governance

  	
   

  	
  $

  	
  5,000

  	
   

  	
  $

  	
  10,000

  	
   

  
	
  Strategy and Operations

  	
   

  	
  $

  	
  10,000

  	
   

  	
  $

  	
  20,000

  	
   

  

·                  The
non-executive Chairman of the Board receives an additional annual retainer of
$50,000 for service in that role that is incremental to any retainers received
for serving as a member or chairperson of a Board committee.

Directors do not receive separate meeting fees.  Employee Directors do not receive any
separate remuneration for service as Directors of the Company.

Non-employee Directors may elect to receive any or
all of their annual retainers otherwise payable in cash in the form of the
Company’s common stock. Non-employee Directors may elect to defer any or all of
their annual retainers (whether payable in cash or in equity) in a deferred
cash account or deferred share account, as applicable, under the terms of the
Avaya Inc. Deferred Compensation Plan.

Additional Benefits/Programs

The Company does not provide a retirement plan for
non-employee Directors.

The Company provides non-employee Directors with
travel accident insurance when traveling in connection with Company-related
business.

Directors have an opportunity to participate in the
Avaya Product Program for Directors, in which certain Avaya products
(specifically, an Avaya IP Office system for one location with up to 20
telephones) and associated maintenance services are provided at no charge;
however, the equipment and the related maintenance is taxable as income to any
Director that chooses to participate, and the Company provides a gross-up for
the resulting taxes.

Directors are eligible to participate in the Avaya
Matching Gift Program.  Under the
program, charitable donations made by an employee or a Director may be matched
dollar for dollar by the Company, subject to a limit of $5,000 per year per
employee or Director.

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