Document:

FORM OF WESTERN ALLIANCE 2002 STOCK OPTION PLAN

 

Exhibit 10.5

WESTERN ALLIANCE BANCORPORATION 2002 STOCK OPTION PLAN

STOCK OPTION AWARD AGREEMENT

	 	 	 
	Grantee’s Name and Address:

	 	 
	 
	 

	 	 
	 
	 

	 	 
	 
	Award Number

	 	 
	 
	Date of Award

	 	 
	 
	Vesting Commencement Date

	 	 
	 
	Exercise Price per Share

	 	$

	 
	Total Number of Shares Subject

	 	 
	 
	to the Option

	 	 
	 
	Total Exercise Price

	 	$

	 
	Type of Option:

	 	                     Incentive Stock Option
	 
	

	 	                     Non-Qualified Stock Option
	 
	Expiration Date:

	 	 
	 
	Post-Termination Exercise Period:

	 	Three (3) Months

     1. Grant of Option. You (the “Grantee”) have been granted an option (the “Option”) to
purchase the Total Number of Shares of Common Stock subject to the Option (the “Shares”) at the
Exercise Price per Share (the “Exercise Price”) set forth above, subject to the terms and
conditions of this Stock Option Award Agreement (the “Option Agreement”) and terms and conditions
of the Western Alliance Bancorporation 2002 Stock Option Plan, as amended from time to time (the
“Plan”), which are incorporated herein by reference. Unless otherwise defined herein, the terms
defined in the Plan shall have the same defined meanings in this Option Agreement.

     If designated above as an Incentive Stock Option, the Option is intended to qualify as an
Incentive Stock Option as defined in Section 422 of the Code. However, notwithstanding such
designation, to the extent that the aggregate Fair Market Value of Shares subject to Options
designated as Incentive Stock Options which become exercisable for the first time by the Grantee
during any calendar year (under all plans of the Company or any Parent or Subsidiary of the
Company) exceeds $100,000, such excess Options, to the extent of the Shares covered thereby in
excess of the foregoing limitation, shall be treated as Non-Qualified Stock Options. For this
purpose, Incentive Stock Options shall be taken into account in the order in which they were

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granted, and the Fair Market Value of the Shares shall be determined as of the date the Option
with respect to such Shares is awarded.

     2. Vesting.

          (a) Vesting Schedule. Subject to the Grantee’s Continuous Service and other
limitations set forth in this Option Agreement and the Plan, the Option may be exercised, in whole
or in part, in accordance with the following schedule: 20% of the Shares subject to the Option
shall vest twelve (12) months after the Vesting Commencement Date, and an additional 20% of the
Shares subject to the Option shall vest on each anniversary of the Vesting Commencement Date
thereafter.

          (b) Leave of Absence. During any authorized leave of absence, the vesting of the
Option as provided in Section 2(a) of this Option Agreement shall be suspended after the leave of
absence exceeds a period of ninety (90) days. Vesting of the Option shall resume upon the
Grantee’s termination of the leave of absence and return to service to the Company or a Related
Entity. The Vesting Schedule of the Option shall be extended by the length of the suspension.

          (c) Termination for Cause. In the event of termination of the Grantee’s Continuous
Service for Cause, the Grantee’s right to exercise the Option shall terminate concurrently with the
termination of the Grantee’s Continuous Service, except as otherwise determined by the
Administrator.

          (d) Change in Status. In the event of the Grantee’s change in status from an Employee
whose customary employment is 20 hours or more per week to an Employee whose customary employment
is fewer than 20 hours per week, vesting of the Option shall continue only to the extent determined
by the Administrator as of such change in status consistent with any minimum vesting requirements
set forth in the Plan. In the event of the Grantee’s change in status from Employee to Consultant,
vesting of the Option shall cease as of such change in status unless otherwise determined by the
Administrator.

     3. Exercise of Option.

          (a) Right to Exercise. The Option shall be exercisable during its term in accordance
with the Vesting Schedule set out in Section 2(a) of this Option Agreement and with the applicable
provisions of the Plan and this Option Agreement. The Option shall be subject to the provisions of
Section 11 of the Plan relating to the exercisability or termination of the Option in the event of
a Corporate Transaction or Change in Control. The Grantee shall be subject to reasonable
limitations on the number of requested exercises during any monthly or weekly period as determined
by the Administrator. In no event shall the Company issue fractional Shares.

          (b) Method of Exercise. The Option shall be exercisable by delivery of an exercise
notice (a form of which is attached as Exhibit A) or by such other procedure as specified from time
to time by the Administrator which shall state the election to exercise the Option, the whole
number of Shares in respect of which the Option is being exercised, and such other provisions as
may be required by the Administrator. The exercise notice shall be delivered in

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person, by certified mail, or by such other method (including electronic transmission) as
determined from time to time by the Administrator to the Company accompanied by payment of the
Exercise Price. The Option shall be deemed to be exercised upon receipt by the Company of such
notice accompanied by the Exercise Price, which, to the extent selected, shall be deemed to be
satisfied by use of the broker-dealer sale and remittance procedure to pay the Exercise Price
provided in Section 5(d), below.

          (c) Taxes. No Shares will be delivered to the Grantee or other person pursuant to the
exercise of the Option until the Grantee or other person has made arrangements acceptable to the
Administrator for the satisfaction of applicable income tax and employment tax withholding
obligations, including, without limitation, such other tax obligations of the Grantee incident to
the receipt of Shares or the disqualifying disposition of Shares received on exercise of an
Incentive Stock Option. Upon exercise of the Option, the Company or the Grantee’s employer may
offset or withhold (from any amount owed by the Company or the Grantee’s employer to the Grantee)
or collect from the Grantee or other person an amount sufficient to satisfy such tax obligations
and/or the employer’s withholding obligations. In the case of an Incentive Stock Option, the
Grantee agrees, as partial consideration for the designation of the Option as an Incentive Stock
Option, to notify the Company in writing within thirty (30) days of any disposition of any shares
acquired by exercise of the Option if such disposition occurs within two (2) years from the Date of
Award or within one (1) year from the date the Shares were transferred to the Grantee. If the
Company is required to satisfy any federal, state or local income or employment tax withholding
obligations as a result of such an early disposition, the Grantee agrees to satisfy the amount of
such withholding in a manner that the Administrator prescribes.

     4. Grantee’s Representations. The Grantee understands that neither the Option nor the
Shares exercisable pursuant to the Option have been registered under the Securities Act of 1933, as
amended or any United States securities laws. In the event the Shares purchasable pursuant to the
exercise of the Option have not been registered under the Securities Act of 1933, as amended, at
the time the Option is exercised, the Grantee shall, if requested by the Company, concurrently with
the exercise of all or any portion of the Option, deliver to the Company an investment
representation statement in a form determined by the Administrator.

     5. Method of Payment. Payment of the Exercise Price shall be made by any of the
following, or a combination thereof, at the election of the Grantee; provided, however, that such
exercise method does not then violate any Applicable Law:

          (a) cash;

          (b) check;

          (c) if the exercise occurs on or after the Registration Date, surrender of Shares or delivery
of a properly executed form of attestation of ownership of Shares as the Administrator may require
(including withholding of Shares otherwise deliverable upon exercise of the Option) which have a
Fair Market Value on the date of surrender or attestation equal to the aggregate Exercise Price of
the Shares as to which the Option is being exercised (but only to the extent that

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such exercise of the Option would not result in an accounting compensation charge with respect
to the Shares used to pay the exercise price); or

          (d) if the exercise occurs on or after the Registration Date, payment through a broker-dealer
sale and remittance procedure pursuant to which the Grantee (i) shall provide written instructions
to a Company-designated brokerage firm to effect the immediate sale of some or all of the purchased
Shares and remit to the Company, out of the sale proceeds available on the settlement date,
sufficient funds to cover the aggregate exercise price payable for the purchased Shares and (ii)
shall provide written directives to the Company to deliver the certificates for the purchased
Shares directly to such brokerage firm in order to complete the sale transaction.

     6. Restrictions on Exercise. The Option may not be exercised if the issuance of the
Shares subject to the Option upon such exercise would constitute a violation of any Applicable
Laws.

     7. Termination or Change of Continuous Service. In the event the Grantee’s Continuous
Service terminates, other than for Cause, the Grantee may, but only during the Post-Termination
Exercise Period, exercise the portion of the Option that was vested at the date of such termination
(the “Termination Date”). In the event of termination of the Grantee’s Continuous Service for
Cause, the Grantee’s right to exercise the Option shall, except as otherwise determined by the
Administrator, terminate concurrently with the termination of the Grantee’s Continuous Service
(also the “Termination Date”). In no event shall the Option be exercised later than the Expiration
Date set forth in this Option Agreement. In the event of the Grantee’s change in status from
Employee or Director to any other status of Employee, Director or Consultant, the Option shall
remain in effect and vesting of the Option shall cease as of such change in status unless otherwise
determined by the Administrator or dictated by any minimum vesting requirements set forth in the
Plan; provided, however, with respect to any Incentive Stock Option that shall remain in effect
after a change in status from Employee to Director, such Incentive Stock Option shall cease to be
treated as an Incentive Stock Option and shall be treated as a Non-Qualified Stock Option on the
day three (3) months and one (1) day following such change in status. Except as provided in
Sections 8 and 9 below, to the extent that the Option was unvested on the Termination Date, or if
the Grantee does not exercise the vested portion of the Option within the Post-Termination Exercise
Period, the Option shall terminate.

     8. Disability of Grantee. In the event the Grantee’s Continuous Service terminates as
a result of his or her Disability, the Grantee may, but only within six (6) months from the
Termination Date (and in no event later than the Expiration Date), exercise the portion of the
Option that was vested on the Termination Date; provided, however, that if such Disability is not a
“disability” as such term is defined in Section 22(e)(3) of the Code and the Option is an Incentive
Stock Option, such Incentive Stock Option shall cease to be treated as an Incentive Stock Option
and shall be treated as a Non-Qualified Stock Option on the day three (3) months and one (1) day
following the Termination Date. To the extent that the Option was unvested on the Termination
Date, or if the Grantee does not exercise the vested portion of the Option within the time
specified herein, the Option shall terminate. Section 22(e)(3) of the Code provides that an
individual is permanently and totally disabled if he or she is unable to engage in any

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substantial gainful activity by reason of any medically determinable physical or mental
impairment which can be expected to result in death or which has lasted or can be expected to last
for a continuous period of not less than twelve (12) months.

     9. Death of Grantee. In the event of the termination of the Grantee’s Continuous
Service as a result of his or her death, or in the event of the Grantee’s death during the
Post-Termination Exercise Period or during the six (6) month period following the Grantee’s
termination of Continuous Service as a result of his or her Disability, the Grantee’s estate, or a
person who acquired the right to exercise the Option by bequest or inheritance, may exercise the
portion of the Option that was vested at the date of termination, within twelve (12) months from
the date of death (but in no event later than the Expiration Date). To the extent that the Option
was unvested on the date of death, or if the vested portion of the Option is not exercised within
the time specified herein, the Option shall terminate.

     10. Transferability of Option. The Option may not be transferred in any manner other
than by will or by the laws of descent and distribution and may be exercised during the lifetime of
the Grantee only by the Grantee. The terms of the Option shall be binding upon the executors,
administrators, heirs and successors of the Grantee.

     11. Term of Option. The Option must be exercised no later than the Expiration Date
set forth in this Option Agreement or such earlier date as otherwise provided herein. After the
Expiration Date or such earlier date, the Option shall be of no further force or effect and may not
be exercised.

     12. Company’s Right of First Refusal.

          (a) Transfer Notice. Neither the Grantee nor a transferee (either being sometimes
referred to herein as the “Holder”) shall sell, hypothecate, encumber or otherwise transfer any
Shares or any right or interest therein without first complying with the provisions of this Section
12 or obtaining the prior written consent of the Company. In the event the Holder desires to
accept a bona fide third-party offer for any or all of the Shares, the Holder shall provide the
Company with written notice (the “Transfer Notice”) of:

               (i) The Holder’s intention to transfer;

               (ii) The name of the proposed transferee;

               (iii) The number of Shares to be transferred; and

               (iv) The proposed transfer price or value and terms thereof.

          (b) First Refusal Exercise Notice. The Company shall have the right to purchase (the
“Right of First Refusal”) all but not less than all, of the Shares which are described in the
Transfer Notice (the “Offered Shares”) at any time during the period commencing upon receipt of the
Transfer Notice and ending twenty (20) days after the first date on which the Company determines
that the Right of First Refusal may be exercised without incurring an accounting expense with
respect to such exercise (the “Option Period”) at (i) the per share price or value and

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in accordance with the terms stated in the Transfer Notice (subject to Section 12(c) below) or
(ii) the Fair Market Value of the Shares on the date on which the purchase is to be effected if no
consideration is paid pursuant to the terms stated in the Transfer Notice, which Right of First
Refusal shall be exercised by written notice (the “First Refusal Exercise Notice”) to the Holder.

          (c) Payment Terms. The Company shall consummate the purchase of the Offered Shares on
the terms set forth in the Transfer Notice within 30 days after delivery of the First Refusal
Exercise Notice; provided, however, that in the event the Transfer Notice provides for the payment
for the Offered Shares other than in cash, the Company and/or its assigns shall have the right to
pay for the Offered Shares by the discounted cash equivalent of the consideration described in the
Transfer Notice as reasonably determined by the Administrator. Upon payment for the Offered Shares
to the Holder or into escrow for the benefit of the Holder, the Company or its assigns shall become
the legal and beneficial owner of the Offered Shares and all rights and interest therein or related
thereto, and the Company shall have the right to transfer the Offered Shares to its own name or its
assigns without further action by the Holder.

          (d) Assignment. Whenever the Company shall have the right to purchase Shares under
this Right of First Refusal, the Company may designate and assign one or more employees, officers,
directors or stockholders of the Company or other persons or organizations, to exercise all or a
part of the Company’s Right of First Refusal.

          (e) Non-Exercise. If the Company and/or its assigns do not collectively elect to
exercise the Right of First Refusal within the Option Period or such earlier time if the Company
and/or its assigns notifies the Holder that it will not exercise the Right of First Refusal, then
the Holder may transfer the Shares upon the terms and conditions stated in the Transfer Notice,
provided that:

               (i) The transfer is made within 90 days of the earlier of (A) the date the Company and/or its
assigns notify the Holder that the Right of First Refusal will not be exercised or (B) the
expiration of the Option Period; and

               (ii) The transferee agrees in writing that such Shares shall be held subject to the provisions
of this Option Agreement.

               (f) Expiration of Transfer Period. Following such 90-day period, no transfer of the
Offered Shares and no change in the terms of the transfer as stated in the Transfer Notice
(including the name of the proposed transferee) shall be permitted without a new written Transfer
Notice prepared and submitted in accordance with the requirements of this Right of First Refusal.

               (g) Termination of Right of First Refusal. The provisions of this Right of First
Refusal shall terminate as to all Shares upon the Registration Date.

               (h) Additional Shares or Substituted Securities. In the event of any transaction
described in Sections 10 or 11 of the Plan, any new, substituted or additional securities or other
property which is by reason of any such transaction distributed with respect to the Shares shall be

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immediately subject to the Right of First Refusal, but only to the extent the Shares are at
the time covered by such right.

     13. Stop-Transfer Notices. In order to ensure compliance with the restrictions on
transfer set forth in this Option Agreement or the Plan, the Company may issue appropriate “stop
transfer” instructions to its transfer agent, if any, and, if the Company transfers its own
securities, it may make appropriate notations to the same effect in its own records.

     14. Refusal to Transfer. The Company shall not be required (i) to transfer on its
books any Shares that have been sold or otherwise transferred in violation of any of the provisions
of this Option Agreement or (ii) to treat as owner of such Shares or to accord the right to vote or
pay dividends to any purchaser or other transferee to whom such Shares shall have been so
transferred.

     15. Tax Consequences. Set forth below is a brief summary as of the date of this
Option Agreement of some of the federal tax consequences of exercise of the Option and disposition
of the Shares. THIS SUMMARY IS NECESSARILY INCOMPLETE, AND THE TAX LAWS AND REGULATIONS ARE
SUBJECT TO CHANGE. THE GRANTEE UNDERSTANDS THAT THE GRANTEE MAY SUFFER ADVERSE TAX CONSEQUENCES AS
A RESULT OF THE GRANTEE’S PURCHASE OR DISPOSITION OF THE SHARES. THE GRANTEE REPRESENTS THAT THE
GRANTEE HAS CONSULTED WITH ANY TAX CONSULTANTS THE GRANTEE DEEMS ADVISABLE IN CONNECTION WITH THE
PURCHASE OR DISPOSITION OF THE SHARES AND THAT THE GRANTEE IS NOT RELYING ON THE COMPANY FOR ANY
TAX ADVICE.

          (a) Exercise of Incentive Stock Option. If the Option qualifies as an Incentive Stock
Option, there will be no regular federal income tax liability upon the exercise of the Option,
although the excess, if any, of the Fair Market Value of the Shares on the date of exercise over
the Exercise Price will be treated as income for purposes of the alternative minimum tax for
federal tax purposes and may subject the Grantee to the alternative minimum tax in the year of
exercise. However, the Internal Revenue Service issued proposed regulations which would subject
the Grantee to withholding at the time the Grantee exercises an Incentive Stock Option for Social
Security and Medicare based upon the excess, if any, of the Fair Market Value of the Shares on the
date of exercise over the Exercise Price. These proposed regulations are subject to further
modification by the Internal Revenue Service and, if adopted, would be effective only for the
exercise of an Incentive Stock Option that occurs two years after the regulations are issued in
final form.

          (b) Exercise of Incentive Stock Option Following Disability. If the Grantee’s
Continuous Service terminates as a result of Disability that is not permanent and total disability
as such term is defined in Section 22(e)(3) of the Code, to the extent permitted on the date of
termination, the Grantee must exercise an Incentive Stock Option within three (3) months of such
termination for the Incentive Stock Option to be qualified as an Incentive Stock Option. Section
22(e)(3) of the Code provides that an individual is permanently and totally disabled if he or she
is unable to engage in any substantial gainful activity by reason of any medically

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determinable physical or mental impairment which can be expected to result in death or which
has lasted or can be expected to last for a continuous period of not less than twelve (12) months.

          (c) Exercise of Non-Qualified Stock Option. On exercise of a Non-Qualified Stock
Option, the Grantee will be treated as having received compensation income (taxable at ordinary
income tax rates) equal to the excess, if any, of the Fair Market Value of the Shares on the date
of exercise over the Exercise Price. If the Grantee is an Employee or a former Employee, the
Company will be required to withhold from the Grantee’s compensation or collect from the Grantee
and pay to the applicable taxing authorities an amount in cash equal to a percentage of this
compensation income at the time of exercise, and may refuse to honor the exercise and refuse to
deliver Shares if such withholding amounts are not delivered at the time of exercise.

          (d) Disposition of Shares. In the case of a Non-Qualified Stock Option, if Shares are
held for more than one year, any gain realized on disposition of the Shares will be treated as
long-term capital gain for federal income tax purposes. In the case of an Incentive Stock Option,
if Shares transferred pursuant to the Option are held for more than one year after receipt of the
Shares and are disposed more than two years after the Date of Award, any gain realized on
disposition of the Shares also will be treated as capital gain for federal income tax purposes and
subject to the same tax rates and holding periods that apply to Shares acquired upon exercise of a
Non-Qualified Stock Option. If Shares purchased under an Incentive Stock Option are disposed of
prior to the expiration of such one-year or two-year periods, any gain realized on such disposition
will be treated as compensation income (taxable at ordinary income rates) to the extent of the
difference between the Exercise Price and the lesser of (i) the Fair Market Value of the Shares on
the date of exercise, or (ii) the sale price of the Shares.

     16. Lock-Up Agreement.

          (a) Agreement. The Grantee, if requested by the Company and the lead underwriter of
any public offering of the Common Stock (the “Lead Underwriter”), hereby irrevocably agrees not to
sell, contract to sell, grant any option to purchase, transfer the economic risk of ownership in,
make any short sale of, pledge or otherwise transfer or dispose of any interest in any Common Stock
or any securities convertible into or exchangeable or exercisable for or any other rights to
purchase or acquire Common Stock (except Common Stock included in such public offering or acquired
on the public market after such offering) during the 180-day period following the effective date of
a registration statement of the Company filed under the Securities Act of 1933, as amended, or such
shorter period of time as the Lead Underwriter shall specify. The Grantee further agrees to sign
such documents as may be requested by the Lead Underwriter to effect the foregoing and agrees that
the Company may impose stop-transfer instructions with respect to such Common Stock subject to the
lock-up period until the end of such period. The Company and the Grantee acknowledge that each
Lead Underwriter of a public offering of the Company’s stock, during the period of such offering
and for the 180-day period thereafter, is an intended beneficiary of this Section 16.

          (b) No Amendment Without Consent of Underwriter. During the period from
identification of a Lead Underwriter in connection with any public offering of the Company’s

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Common Stock until the earlier of (i) the expiration of the lock-up period specified in
Section 16(a) in connection with such offering or (ii) the abandonment of such offering by the
Company and the Lead Underwriter, the provisions of this Section 16 may not be amended or waived
except with the consent of the Lead Underwriter.

     17. Entire Agreement: Governing Law. The Plan and this Option Agreement constitute
the entire agreement of the parties with respect to the subject matter hereof and supersede in
their entirety all prior undertakings and agreements of the Company and the Grantee with respect to
the subject matter hereof, and may not be modified adversely to the Grantee’s interest except by
means of a writing signed by the Company and the Grantee. Nothing in the Plan and this Option
Agreement (except as expressly provided therein) is intended to confer any rights or remedies on
any persons other than the parties. The Plan and this Option Agreement are to be construed in
accordance with and governed by the internal laws of the State of Nevada without giving effect to
any choice of law rule that would cause the application of the laws of any jurisdiction other than
the internal laws of the State of Nevada to the rights and duties of the parties. Should any
provision of the Plan or this Option Agreement be determined by a court of law to be illegal or
unenforceable, such provision shall be enforced to the fullest extent allowed by law and the other
provisions shall nevertheless remain effective and shall remain enforceable.

     18. Headings. The captions used in this Option Agreement are inserted for convenience
and shall not be deemed a part of the Option for construction or interpretation.

     19. Dispute Resolution. The provisions of this Section 19 shall be the exclusive
means of resolving disputes arising out of or relating to the Plan and this Option Agreement. The
Company, the Grantee, and the Grantee’s assignees (the “parties”) shall attempt in good faith to
resolve any disputes arising out of or relating to the Plan and this Option Agreement by
negotiation between individuals who have authority to settle the controversy. Negotiations shall
be commenced by either party by notice of a written statement of the party’s position and the name
and title of the individual who will represent the party. Within thirty (30) days of the written
notification, the parties shall meet at a mutually acceptable time and place, and thereafter as
often as they reasonably deem necessary, to resolve the dispute. If the dispute has not been
resolved by negotiation, the parties agree that any suit, action, or proceeding arising out of or
relating to the Plan or this Option Agreement shall be brought in the United States District Court
for the District of Nevada (or should such court lack jurisdiction to hear such action, suit or
proceeding, in a Nevada state court in the County of Clark) and that the parties shall submit to
the jurisdiction of such court. The parties irrevocably waive, to the fullest extent permitted by
law, any objection the party may have to the laying of venue for any such suit, action or
proceeding brought in such court. THE PARTIES ALSO EXPRESSLY WAIVE ANY RIGHT THEY HAVE OR MAY HAVE
TO A JURY TRIAL OF ANY SUCH SUIT, ACTION OR PROCEEDING. If any one or more provisions of this
Section 19 shall for any reason be held invalid or unenforceable, it is the specific intent of the
parties that such provisions shall be modified to the minimum extent necessary to make it or its
application valid and enforceable.

     20. Notices. Any notice required or permitted hereunder shall be given in writing and
shall be deemed effectively given upon personal delivery, upon deposit for delivery by an
internationally recognized express mail courier service or upon deposit in the United States mail

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by certified mail (if the parties are within the United States), with postage and fees
prepaid, addressed to the other party at its address as shown in this Option Agreement, or to such
other address as such party may designate in writing from time to time to the other party.

     21. Confidentiality. The Company shall provide to the Grantee, during the period the
Option is outstanding, copies of financial statements of the Company at least annually. The
Grantee understands and agrees that such financial statements are confidential and shall not be
disclosed by the Grantee, to any entity or person, for any reason, at any time, without the prior
written consent of the Company, unless required by law. If disclosure of such financial statements
is required by law, whether through subpoena, request for production, deposition, or otherwise, the
Grantee promptly shall provide written notice to Company, including copies of the subpoena, request
for production, deposition, or otherwise, within five (5) business days of their receipt by the
Grantee and prior to any disclosure so as to provide Company an opportunity to move to quash or
otherwise to oppose the disclosure. Notwithstanding the foregoing, the Grantee may disclose the
terms of such financial statements to his or her spouse or domestic partner, and for legitimate
business reasons, to legal, financial, and tax advisors.

     22. Rights as Stockholder. Until the stock certificate evidencing the Shares is
issued following the exercise of the Option (as evidenced by the appropriate entry on the books of
the Company or of a duly authorized transfer agent of the Company), no right to vote or receive
dividends or any other rights as a stockholder shall exist with respect to the Shares,
notwithstanding the exercise of the Option. The Company shall issue (or cause to be issued) such
stock certificate promptly after the Option is exercised. No adjustment will be made for a
dividend or other right for which the record date is prior to the date the stock certificate is
issued, except as provided in Section 10 of the Plan. The Grantee shall enjoy rights as a
stockholder until such time as the Grantee disposes of the Shares or the Company and/or its
assignee(s) exercises the Right of First Refusal. Upon such exercise, the Grantee shall have no
further rights as a holder of the Shares so purchased except the right to receive payment for the
Shares so purchased in accordance with the provisions of this Option Agreement, and the Grantee
shall forthwith cause the certificate(s) evidencing the Shares so purchased to be surrendered to
the Company for transfer or cancellation.

     23. Restrictive Legends. The Grantee understands and agrees that the Company shall
cause the legends set forth below or legends substantially equivalent thereto, to be placed upon
any certificate(s) evidencing ownership of the Shares together with any other legends that may be
required by the Company or by state or federal securities laws:

THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933 (THE “ACT”) OR ANY STATE SECURITIES LAWS AND
MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED, PLEDGED OR
HYPOTHECATED UNLESS AND UNTIL REGISTERED UNDER THE ACT OR, IN THE
OPINION OF COUNSEL SATISFACTORY TO THE ISSUER OF THESE SECURITIES,
SUCH OFFER, SALE OR

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TRANSFER, PLEDGE OR HYPOTHECATION IS IN COMPLIANCE THEREWITH.

THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN
RESTRICTIONS ON TRANSFER AND A RIGHT OF FIRST REFUSAL HELD BY THE
ISSUER OR ITS ASSIGNEE(S) AS SET FORTH IN THE OPTION AGREEMENT
BETWEEN THE ISSUER AND THE ORIGINAL HOLDER OF THESE SHARES, A COPY
OF WHICH MAY BE OBTAINED AT THE PRINCIPAL OFFICE OF THE ISSUER.
SUCH TRANSFER RESTRICTIONS AND RIGHT OF FIRST REFUSAL ARE BINDING ON
TRANSFEREES OF THESE SHARES.

     IN WITNESS WHEREOF, the Company and the Grantee have executed this Option Agreement and agree
that the Option is to be governed by the terms and conditions of this Option Agreement and the
Plan.

	 	 	 
	

	 	Western Alliance Bancorporation
	

	 	a Nevada corporation
	 
	 	 
	

	 	By:
	 
	 	 
	

	 	Title:

THE GRANTEE ACKNOWLEDGES AND AGREES THAT THE SHARES SUBJECT TO THE OPTION SHALL VEST, IF AT ALL,
ONLY DURING THE PERIOD OF THE GRANTEE’S CONTINUOUS SERVICE (NOT THROUGH THE ACT OF BEING HIRED,
BEING GRANTED THE OPTION OR ACQUIRING SHARES HEREUNDER). THE GRANTEE FURTHER ACKNOWLEDGES AND
AGREES THAT NOTHING IN THIS OPTION AGREEMENT OR THE PLAN SHALL CONFER UPON THE GRANTEE ANY RIGHT
WITH RESPECT TO FUTURE AWARDS OR CONTINUATION OF THE GRANTEE’S CONTINUOUS SERVICE, NOR SHALL IT
INTERFERE IN ANY WAY WITH THE GRANTEE’S RIGHT OR THE RIGHT OF THE COMPANY OR RELATED ENTITY TO
WHICH THE GRANTEE PROVIDES SERVICES TO TERMINATE THE GRANTEE’S CONTINUOUS SERVICE, WITH OR WITHOUT
CAUSE, AND WITH OR WITHOUT NOTICE. THE GRANTEE ACKNOWLEDGES THAT UNLESS THE GRANTEE
HAS A WRITTEN EMPLOYMENT AGREEMENT WITH THE COMPANY TO THE CONTRARY, THE GRANTEE’S STATUS IS AT
WILL.

     The Grantee acknowledges receipt of a copy of this Option Agreement and the Plan, and
represents that he or she is familiar with the terms and provisions thereof, and hereby accepts the
Option subject to all of the terms and provisions hereof and thereof. The Grantee has reviewed
this Option Agreement and the Plan in their entirety, has had an opportunity to obtain the advice
of counsel prior to executing this Option Agreement, and fully understands all provisions of this
Option Agreement and the Plan. The Grantee hereby agrees that all disputes arising out of or

11

 

relating to this Option Agreement and the Plan shall be resolved in accordance with Section 19
of this Option Agreement. The Grantee further agrees to notify the Company upon any change in the
residence address indicated in this Option Agreement.

	 	 	 	 	 	 	 
	Dated:

	 	 
	 	Signed:
	 	 
	

	 	 	 	 	 	Grantee

12

 

EXHIBIT A

WESTERN ALLIANCE BANCORPORATION 2002 STOCK OPTION PLAN

EXERCISE NOTICE

___

Attention: Chief Financial Officer

     1. Effective as of today, ___, the undersigned (the “Grantee”) hereby elects to
exercise the Grantee’s option to purchase ___shares of the Common Stock (the “Shares”) of
Western Alliance Bancorporation, (the “Company”) under and pursuant to the Company’s 2002 Stock
Option Plan, as amended from time to time (the “Plan”) and the [ ] Incentive [ ] Non-Qualified
Stock Option Award Agreement (the “Option Agreement”) dated ___, ___. Unless
otherwise defined herein, the terms defined in the Plan shall have the same defined meanings in
this Exercise Notice.

     2. Representations of the Grantee. The Grantee acknowledges that the Grantee has
received, read and understood the Plan and the Option Agreement and agrees to abide by and be bound
by their terms and conditions. In the event the Shares purchased hereunder have not been
registered under the Securities Act of 1933, as amended, the Grantee shall, if requested by the
Company, deliver to the Company his or her Investment Representation Statement in the form attached
hereto as Exhibit 1.

     3. Delivery of Payment. The Grantee herewith delivers to the Company the full
Exercise Price for the Shares, which, to the extent selected, shall be deemed to be satisfied by
use of the broker-dealer sale and remittance procedure to pay the Exercise Price provided in
Section 5(d) of the Option Agreement.

     4. Successors and Assigns. The Company may assign any of its rights under this
Exercise Notice to single or multiple assignees, and this agreement shall inure to the benefit of
the successors and assigns of the Company. Subject to the restrictions on transfer herein set
forth, this Exercise Notice shall be binding upon the Grantee and his or her heirs, executors,
administrators, successors and assigns.

     5. Headings. The captions used in this Exercise Notice are inserted for convenience
and shall not be deemed a part of this agreement for construction or interpretation.

     6. Further Instruments. The parties agree to execute such further instruments and to
take such further action as may be reasonably necessary to carry out the purposes and intent of
this Exercise Notice.

     7. Entire Agreement. The Plan and the Option Agreement are incorporated herein by
reference and together with this Exercise Notice constitute the entire agreement of the parties
with respect to the subject matter hereof and supersede in their entirety all prior undertakings
and agreements of the Company and the Grantee with respect to the subject matter hereof, and may

1

 

not be modified adversely to the Grantee’s interest except by means of a writing signed by the
Company and the Grantee. Nothing in the Plan, the Option Agreement and this Exercise Notice
(except as expressly provided therein) is intended to confer any rights or remedies on any persons
other than the parties.

	 	 	 	 	 
	Submitted by:	 	Accepted by:
	 
	 	 	 	 
	GRANTEE:	 	WESTERN ALLIANCE BANCORPORATION
	 
	 	 	 	 
	

	 	By:
	 	 
	 
	 	 	 	 
	 	 	Title:
	 	 
	(Signature)
	 	 	 	 
	 
	 	 	 	 
	Address:	 	Address:
	 
	 	 	 	 
	 	 	 
	 
	 	 	 	 
	 	 	 	 	 

2

 

EXHIBIT 1

WESTERN ALLIANCE BANCORPORATION 2002 STOCK OPTION PLAN

INVESTMENT REPRESENTATION STATEMENT

	 	 	 
	GRANTEE:

	 	 
	 
	 	 
	COMPANY:

	 	WESTERN ALLIANCE BANCORPORATION
	 
	 	 
	SECURITY:

	 	COMMON STOCK
	 
	 	 
	AMOUNT:

	 	 
	 
	 	 
	DATE:

	 	 

In connection with the purchase of the above-listed Securities, the undersigned Grantee represents
to the Company the following:

          (a) Grantee is aware of the Company’s business affairs and financial condition and has
acquired sufficient information about the Company to reach an informed and knowledgeable decision
to acquire the Securities. Grantee is acquiring these Securities for investment for Grantee’s own
account only and not with a view to, or for resale in connection with, any “distribution” thereof
within the meaning of the Securities Act of 1933, as amended (the “Securities Act”).

          (b) Grantee acknowledges and understands that the Securities constitute “restricted
securities” under the Securities Act and have not been registered under the Securities Act in
reliance upon a specific exemption therefrom, which exemption depends upon among other things, the
bona fide nature of Grantee’s investment intent as expressed herein. Grantee further understands
that the Securities must be held indefinitely unless they are subsequently registered under the
Securities Act or an exemption from such registration is available. Grantee further acknowledges
and understands that the Company is under no obligation to register the Securities. Grantee
understands that the certificate evidencing the Securities will be imprinted with a legend which
prohibits the transfer of the Securities unless they are registered or such registration is not
required in the opinion of counsel satisfactory to the Company.

          (c) Grantee is familiar with the provisions of Rule 701 and Rule 144, each promulgated under
the Securities Act, which, in substance, permit limited public resale of “restricted securities”
acquired, directly or indirectly from the issuer thereof, in a non-public offering subject to the
satisfaction of certain conditions. Rule 701 provides that if the issuer qualifies under Rule 701
at the time of the grant of the Option to the Grantee, the exercise will be exempt from
registration under the Securities Act. In the event the Company becomes subject to the reporting
requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, ninety (90) days
thereafter (or such longer period as any market stand-off agreement may require) the Securities
exempt under Rule 701 may be resold, subject to the satisfaction of certain of the conditions
specified by Rule 144, including: (1) the resale being made through a broker in an unsolicited
“broker’s transaction” or in transactions directly with a market maker (as said term is defined
under the Securities Exchange Act of 1934); and, in the case of an affiliate, (2) the

3

 

availability of certain public information about the Company, (3) the amount of Securities
being sold during any three month period not exceeding the limitations specified in Rule 144(e),
and (4) the timely filing of a Form 144, if applicable.

     In the event that the Company does not qualify under Rule 701 at the time of grant of the
Option, then the Securities may be resold in certain limited circumstances subject to the
provisions of Rule 144, which requires the resale to occur not less than one year after the later
of the date the Securities were sold by the Company or the date the Securities were sold by an
affiliate of the Company, within the meaning of Rule 144; and, in the case of acquisition of the
Securities by an affiliate, or by a non-affiliate who subsequently holds the Securities less than
two (2) years, the satisfaction of the conditions set forth in sections (1), (2), (3) and (4) of
the paragraph immediately above.

          (d) Grantee further understands that in the event all of the applicable requirements of Rule
701 or 144 are not satisfied, registration under the Securities Act, compliance with Regulation A,
or some other registration exemption will be required; and that, notwithstanding the fact that
Rules 144 and 701 are not exclusive, the Staff of the Securities and Exchange Commission has
expressed its opinion that persons proposing to sell private placement securities other than in a
registered offering and otherwise than pursuant to Rules 144 or 701 will have a substantial burden
of proof in establishing that an exemption from registration is available for such offers or sales,
and that such persons and their respective brokers who participate in such transactions do so at
their own risk. Grantee understands that no assurances can be given that any such other
registration exemption will be available in such event.

          (e) Grantee represents that Grantee is a resident of the state of ___.

	 
	Signature of Grantee:

	 

	 
	Date:           ,                    

4FORM OF WESTERN ALLIANCE 2002 STOCK OPTION PLAN

 

Exhibit 10.6

WESTERN ALLIANCE BANCORPORATION 2002 STOCK OPTION PLAN

STOCK OPTION AWARD AGREEMENT

[DOUBLE TRIGGER ACCELERATION – REMOVE HEADING BEFORE ISSUANCE]

	 	 	 
	Grantee’s Name and Address:

	 	                                                            
	

	 	                                                            
	

	 	                                                            
	Award Number

	 	                                                            
	Date of Award

	 	                                                            
	Vesting Commencement Date

	 	                                                            
	Exercise Price per Share

	 	$                                                          
	Total Number of Shares Subject
to the Option

	 	                                                            
	Total Exercise Price

	 	$                                                          
	Type of Option:

	 	                     Incentive Stock Option
	

	 	                     Non-Qualified Stock Option
	Expiration Date:

	 	                                        
	Post-Termination Exercise Period:

	 	Three (3) Months

     1. Grant of Option. You (the “Grantee”) have been granted an option (the “Option”) to
purchase the Total Number of Shares of Common Stock subject to the Option (the “Shares”) at the
Exercise Price per Share (the “Exercise Price”) set forth above, subject to the terms and
conditions of this Stock Option Award Agreement (the “Option Agreement”) and terms and conditions
of the Western Alliance Bancorporation 2002 Stock Option Plan, as amended from time to time (the
“Plan”), which are incorporated herein by reference. Unless otherwise defined herein, the terms
defined in the Plan shall have the same defined meanings in this Option Agreement.

     If designated above as an Incentive Stock Option, the Option is intended to qualify as an
Incentive Stock Option as defined in Section 422 of the Code. However, notwithstanding such
designation, to the extent that the aggregate Fair Market Value of Shares subject to Options
designated as Incentive Stock Options which become exercisable for the first time by the Grantee

1

 

during any calendar year (under all plans of the Company or any Parent or Subsidiary of the
Company) exceeds $100,000, such excess Options, to the extent of the Shares covered thereby in
excess of the foregoing limitation, shall be treated as Non-Qualified Stock Options. For this
purpose, Incentive Stock Options shall be taken into account in the order in which they were
granted, and the Fair Market Value of the Shares shall be determined as of the date the Option with
respect to such Shares is awarded.

     2. Vesting.

          (a) Vesting Schedule. Subject to the Grantee’s Continuous Service and other
limitations set forth in this Option Agreement and the Plan, the Option may be exercised, in whole
or in part, in accordance with the following schedule: 20% of the Shares subject to the Option
shall vest twelve (12) months after the Vesting Commencement Date, and an additional 20% of the
Shares subject to the Option shall vest on each anniversary of the Vesting Commencement Date
thereafter.

          (b) Leave of Absence. During any authorized leave of absence, the vesting of the
Option as provided in Section 2(a) of this Option Agreement shall be suspended after the leave of
absence exceeds a period of ninety (90) days. Vesting of the Option shall resume upon the
Grantee’s termination of the leave of absence and return to service to the Company or a Related
Entity. The Vesting Schedule of the Option shall be extended by the length of the suspension.

          (c) Termination for Cause. In the event of termination of the Grantee’s Continuous
Service for Cause, the Grantee’s right to exercise the Option shall terminate concurrently with the
termination of the Grantee’s Continuous Service, except as otherwise determined by the
Administrator.

          (d) Change in Status. In the event of the Grantee’s change in status from an Employee
whose customary employment is 20 hours or more per week to an Employee whose customary employment
is fewer than 20 hours per week, vesting of the Option shall continue only to the extent determined
by the Administrator as of such change in status consistent with any minimum vesting requirements
set forth in the Plan. In the event of the Grantee’s change in status from Employee to Consultant,
vesting of the Option shall cease as of such change in status unless otherwise determined by the
Administrator.

     3. Exercise of Option.

          (a) Right to Exercise. The Option shall be exercisable during its term in accordance
with the Vesting Schedule set out in Section 2(a) of this Option Agreement and with the applicable
provisions of the Plan and this Option Agreement. The Option shall be subject to the provisions of
Section 11 of the Plan and Section 4 of this Option Agreement relating to the exercisability or
termination of the Option in the event of a Corporate Transaction or Change in Control. The
Grantee shall be subject to reasonable limitations on the number of requested exercises during any
monthly or weekly period as determined by the Administrator. In no event shall the Company issue
fractional Shares.

2

 

          (b) Method of Exercise. The Option shall be exercisable by delivery of an exercise
notice (a form of which is attached as Exhibit A) or by such other procedure as specified from time
to time by the Administrator which shall state the election to exercise the Option, the whole
number of Shares in respect of which the Option is being exercised, and such other provisions as
may be required by the Administrator. The exercise notice shall be delivered in person, by
certified mail, or by such other method (including electronic transmission) as determined from time
to time by the Administrator to the Company accompanied by payment of the Exercise Price. The
Option shall be deemed to be exercised upon receipt by the Company of such notice accompanied by
the Exercise Price, which, to the extent selected, shall be deemed to be satisfied by use of the
broker-dealer sale and remittance procedure to pay the Exercise Price provided in Section 6(d),
below.

          (c) Taxes. No Shares will be delivered to the Grantee or other person pursuant to the
exercise of the Option until the Grantee or other person has made arrangements acceptable to the
Administrator for the satisfaction of applicable income tax and employment tax withholding
obligations, including, without limitation, such other tax obligations of the Grantee incident to
the receipt of Shares or the disqualifying disposition of Shares received on exercise of an
Incentive Stock Option. Upon exercise of the Option, the Company or the Grantee’s employer may
offset or withhold (from any amount owed by the Company or the Grantee’s employer to the Grantee)
or collect from the Grantee or other person an amount sufficient to satisfy such tax obligations
and/or the employer’s withholding obligations. In the case of an Incentive Stock Option, the
Grantee agrees, as partial consideration for the designation of the Option as an Incentive Stock
Option, to notify the Company in writing within thirty (30) days of any disposition of any shares
acquired by exercise of the Option if such disposition occurs within two (2) years from the Date of
Award or within one (1) year from the date the Shares were transferred to the Grantee. If the
Company is required to satisfy any federal, state or local income or employment tax withholding
obligations as a result of such an early disposition, the Grantee agrees to satisfy the amount of
such withholding in a manner that the Administrator prescribes.

     4. Acceleration of Vesting.

          (a) Termination of Option to Extent Not Assumed in Corporate Transaction. Effective
upon the consummation of a Corporate Transaction, the Option shall terminate. However, the Option
shall not terminate to the extent it is Assumed in connection with the Corporate Transaction.

          (b) Acceleration of Option Upon Corporate Transaction or Change in Control.

               (i) Corporate Transaction. In the event of a Corporate Transaction and:

                    (A) for the portion of the Option that is Assumed or Replaced, then the Option (if Assumed),
the replacement award (if Replaced), or the cash incentive program (if Replaced) automatically
shall become fully vested, exercisable and payable and be released from any repurchase or
forfeiture rights (other than repurchase rights exercisable at Fair Market

3

 

Value) for all of the Shares at the time represented by such Assumed or Replaced portion of
the Option, immediately upon termination of the Grantee’s Continuous Service if such Continuous
Service is terminated by the successor company or the Company without Cause or voluntarily by the
Grantee with Good Reason within twelve (12) months of the Corporate Transaction; and

                    (B) for the portion of the Option that is neither Assumed nor Replaced, such portion of the
Option shall automatically become fully vested and exercisable and be released from any repurchase
or forfeiture rights (other than repurchase rights exercisable at Fair Market Value) for all of the
Shares at the time represented by such portion of the Option, immediately prior to the specified
effective date of such Corporate Transaction.

               (ii) Change in Control. In the event of a Change in Control (other than a Change in
Control which also is a Corporate Transaction), the Option shall become fully vested and
exercisable and be released from any repurchase or forfeiture rights (other than repurchase rights
exercisable at Fair Market Value), immediately prior to the specified effective date of such Change
in Control, for all of the Shares at the time represented by the Option.

          (c) Effect of Acceleration on Incentive Stock Options. If the Option is an Incentive
Stock Option, the portion of the Option accelerated under this Section 4 in connection with a
Corporate Transaction or Change in Control shall remain exercisable as an Incentive Stock Option
under the Code only to the extent the $100,000 dollar limitation of Section 422(d) of the Code is
not exceeded. To the extent such dollar limitation is exceeded, the accelerated excess portion of
the Option shall be exercisable as a Non-Qualified Stock Option.

          (d) Definition of Good Reason. “Good Reason” means the occurrence after a Corporate
Transaction of any of the following events or conditions unless consented to by the Grantee (and
the Grantee shall be deemed to have consented to any such event or condition unless the Grantee
provides written notice of the Grantee’s non-acquiescence within 30 days of the effective time of
such event or condition):

               (i) a change in the Grantee’s responsibilities or duties which represents a material and
substantial diminution in the Grantee’s responsibilities or duties as in effect immediately
preceding the consummation of a Corporate Transaction;

               (ii) a reduction in the Grantee’s base salary to a level below that in effect at any time
within six (6) months preceding the consummation of a Corporate Transaction or at any time
thereafter; or

               (iii) requiring the Grantee to be based at any place outside a 50-mile radius from the
Grantee’s job location or residence prior to the Corporate Transaction except for reasonably
required travel on business which is not materially greater than such travel requirements prior to
the Corporate Transaction.

     5. Grantee’s Representations. The Grantee understands that neither the Option nor the
Shares exercisable pursuant to the Option have been registered under the Securities Act of 1933, as
amended or any United States securities laws. In the event the Shares purchasable pursuant to the
exercise of the Option have not been registered under the Securities Act of 1933, as amended,

4

 

at the time the Option is exercised, the Grantee shall, if requested by the Company,
concurrently with the exercise of all or any portion of the Option, deliver to the Company an
investment representation statement in a form determined by the Administrator.

     6. Method of Payment. Payment of the Exercise Price shall be made by any of the
following, or a combination thereof, at the election of the Grantee; provided, however, that such
exercise method does not then violate any Applicable Law:

          (a) cash;

          (b) check;

          (c) if the exercise occurs on or after the Registration Date, surrender of Shares or delivery
of a properly executed form of attestation of ownership of Shares as the Administrator may require
(including withholding of Shares otherwise deliverable upon exercise of the Option) which have a
Fair Market Value on the date of surrender or attestation equal to the aggregate Exercise Price of
the Shares as to which the Option is being exercised (but only to the extent that such exercise of
the Option would not result in an accounting compensation charge with respect to the Shares used to
pay the exercise price); or

          (d) if the exercise occurs on or after the Registration Date, payment through a broker-dealer
sale and remittance procedure pursuant to which the Grantee (i) shall provide written instructions
to a Company-designated brokerage firm to effect the immediate sale of some or all of the purchased
Shares and remit to the Company, out of the sale proceeds available on the settlement date,
sufficient funds to cover the aggregate exercise price payable for the purchased Shares and (ii)
shall provide written directives to the Company to deliver the certificates for the purchased
Shares directly to such brokerage firm in order to complete the sale transaction.

     7. Restrictions on Exercise. The Option may not be exercised if the issuance of the
Shares subject to the Option upon such exercise would constitute a violation of any Applicable
Laws.

     8. Termination or Change of Continuous Service. In the event the Grantee’s Continuous
Service terminates, other than for Cause, the Grantee may, but only during the Post-Termination
Exercise Period, exercise the portion of the Option that was vested at the date of such termination
(the “Termination Date”). In the event of termination of the Grantee’s Continuous Service for
Cause, the Grantee’s right to exercise the Option shall, except as otherwise determined by the
Administrator, terminate concurrently with the termination of the Grantee’s Continuous Service
(also the “Termination Date”). In no event shall the Option be exercised later than the Expiration
Date set forth in this Option Agreement. In the event of the Grantee’s change in status from
Employee or Director to any other status of Employee, Director or Consultant, the Option shall
remain in effect and vesting of the Option shall cease as of such change in status unless otherwise
determined by the Administrator or dictated by any minimum vesting requirements set forth in the
Plan; provided, however, with respect to any Incentive Stock Option that shall remain in effect
after a change in status from Employee to Director, such

5

 

Incentive Stock Option shall cease to be treated as an Incentive Stock Option and shall be
treated as a Non-Qualified Stock Option on the day three (3) months and one (1) day following such
change in status. Except as provided in Sections 9 and 10 below, to the extent that the Option was
unvested on the Termination Date, or if the Grantee does not exercise the vested portion of the
Option within the Post-Termination Exercise Period, the Option shall terminate.

     9. Disability of Grantee. In the event the Grantee’s Continuous Service terminates as
a result of his or her Disability, the Grantee may, but only within six (6) months from the
Termination Date (and in no event later than the Expiration Date), exercise the portion of the
Option that was vested on the Termination Date; provided, however, that if such Disability is not a
“disability” as such term is defined in Section 22(e)(3) of the Code and the Option is an Incentive
Stock Option, such Incentive Stock Option shall cease to be treated as an Incentive Stock Option
and shall be treated as a Non-Qualified Stock Option on the day three (3) months and one (1) day
following the Termination Date. To the extent that the Option was unvested on the Termination
Date, or if the Grantee does not exercise the vested portion of the Option within the time
specified herein, the Option shall terminate. Section 22(e)(3) of the Code provides that an
individual is permanently and totally disabled if he or she is unable to engage in any substantial
gainful activity by reason of any medically determinable physical or mental impairment which can be
expected to result in death or which has lasted or can be expected to last for a continuous period
of not less than twelve (12) months.

     10. Death of Grantee. In the event of the termination of the Grantee’s Continuous
Service as a result of his or her death, or in the event of the Grantee’s death during the
Post-Termination Exercise Period or during the six (6) month period following the Grantee’s
termination of Continuous Service as a result of his or her Disability, the Grantee’s estate, or a
person who acquired the right to exercise the Option by bequest or inheritance, may exercise the
portion of the Option that was vested at the date of termination, within twelve (12) months from
the date of death (but in no event later than the Expiration Date). To the extent that the Option
was unvested on the date of death, or if the vested portion of the Option is not exercised within
the time specified herein, the Option shall terminate.

     11. Transferability of Option. The Option may not be transferred in any manner other
than by will or by the laws of descent and distribution and may be exercised during the lifetime of
the Grantee only by the Grantee. The terms of the Option shall be binding upon the executors,
administrators, heirs and successors of the Grantee.

     12. Term of Option. The Option must be exercised no later than the Expiration Date
set forth in this Option Agreement or such earlier date as otherwise provided herein. After the
Expiration Date or such earlier date, the Option shall be of no further force or effect and may not
be exercised.

     13. Company’s Right of First Refusal.

          (a) Transfer Notice. Neither the Grantee nor a transferee (either being sometimes
referred to herein as the “Holder”) shall sell, hypothecate, encumber or otherwise transfer any
Shares or any right or interest therein without first complying with the provisions of this

6

 

Section 13 or obtaining the prior written consent of the Company. In the event the Holder
desires to accept a bona fide third-party offer for any or all of the Shares, the Holder shall
provide the Company with written notice (the “Transfer Notice”) of:

               (i) The Holder’s intention to transfer;

               (ii) The name of the proposed transferee;

               (iii) The number of Shares to be transferred; and

               (iv) The proposed transfer price or value and terms thereof.

          (b) First Refusal Exercise Notice. The Company shall have the right to purchase (the
“Right of First Refusal”) all but not less than all, of the Shares which are described in the
Transfer Notice (the “Offered Shares”) at any time during the period commencing upon receipt of the
Transfer Notice and ending twenty (20) days after the first date on which the Company determines
that the Right of First Refusal may be exercised without incurring an accounting expense with
respect to such exercise (the “Option Period”) at (i) the per share price or value and in
accordance with the terms stated in the Transfer Notice (subject to Section 13(c) below) or (ii)
the Fair Market Value of the Shares on the date on which the purchase is to be effected if no
consideration is paid pursuant to the terms stated in the Transfer Notice, which Right of First
Refusal shall be exercised by written notice (the “First Refusal Exercise Notice”) to the Holder.

          (c) Payment Terms. The Company shall consummate the purchase of the Offered Shares on
the terms set forth in the Transfer Notice within 30 days after delivery of the First Refusal
Exercise Notice; provided, however, that in the event the Transfer Notice provides for the payment
for the Offered Shares other than in cash, the Company and/or its assigns shall have the right to
pay for the Offered Shares by the discounted cash equivalent of the consideration described in the
Transfer Notice as reasonably determined by the Administrator. Upon payment for the Offered Shares
to the Holder or into escrow for the benefit of the Holder, the Company or its assigns shall become
the legal and beneficial owner of the Offered Shares and all rights and interest therein or related
thereto, and the Company shall have the right to transfer the Offered Shares to its own name or its
assigns without further action by the Holder.

          (d) Assignment. Whenever the Company shall have the right to purchase Shares under
this Right of First Refusal, the Company may designate and assign one or more employees, officers,
directors or stockholders of the Company or other persons or organizations, to exercise all or a
part of the Company’s Right of First Refusal.

          (e) Non-Exercise. If the Company and/or its assigns do not collectively elect to
exercise the Right of First Refusal within the Option Period or such earlier time if the Company
and/or its assigns notifies the Holder that it will not exercise the Right of First Refusal, then
the Holder may transfer the Shares upon the terms and conditions stated in the Transfer Notice,
provided that:

7

 

               (i) The transfer is made within 90 days of the earlier of (A) the date the Company and/or its
assigns notify the Holder that the Right of First Refusal will not be exercised or (B) the
expiration of the Option Period; and

               (ii) The transferee agrees in writing that such Shares shall be held subject to the provisions
of this Option Agreement.

          (f) Expiration of Transfer Period. Following such 90-day period, no transfer of the
Offered Shares and no change in the terms of the transfer as stated in the Transfer Notice
(including the name of the proposed transferee) shall be permitted without a new written Transfer
Notice prepared and submitted in accordance with the requirements of this Right of First Refusal.

          (g) Termination of Right of First Refusal. The provisions of this Right of First
Refusal shall terminate as to all Shares upon the Registration Date.

          (h) Additional Shares or Substituted Securities. In the event of any transaction
described in Sections 10 or 11 of the Plan, any new, substituted or additional securities or other
property which is by reason of any such transaction distributed with respect to the Shares shall be
immediately subject to the Right of First Refusal, but only to the extent the Shares are at the
time covered by such right.

     14. Stop-Transfer Notices. In order to ensure compliance with the restrictions on
transfer set forth in this Option Agreement or the Plan, the Company may issue appropriate “stop
transfer” instructions to its transfer agent, if any, and, if the Company transfers its own
securities, it may make appropriate notations to the same effect in its own records.

     15. Refusal to Transfer. The Company shall not be required (i) to transfer on its
books any Shares that have been sold or otherwise transferred in violation of any of the provisions
of this Option Agreement or (ii) to treat as owner of such Shares or to accord the right to vote or
pay dividends to any purchaser or other transferee to whom such Shares shall have been so
transferred.

     16. Tax Consequences. Set forth below is a brief summary as of the date of this
Option Agreement of some of the federal tax consequences of exercise of the Option and disposition
of the Shares. THIS SUMMARY IS NECESSARILY INCOMPLETE, AND THE TAX LAWS AND REGULATIONS ARE
SUBJECT TO CHANGE. THE GRANTEE UNDERSTANDS THAT THE GRANTEE MAY SUFFER ADVERSE TAX CONSEQUENCES AS
A RESULT OF THE GRANTEE’S PURCHASE OR DISPOSITION OF THE SHARES. THE GRANTEE REPRESENTS THAT THE
GRANTEE HAS CONSULTED WITH ANY TAX CONSULTANTS THE GRANTEE DEEMS ADVISABLE IN CONNECTION WITH THE
PURCHASE OR DISPOSITION OF THE SHARES AND THAT THE GRANTEE IS NOT RELYING ON THE COMPANY FOR ANY
TAX ADVICE.

          (a) Exercise of Incentive Stock Option. If the Option qualifies as an Incentive Stock
Option, there will be no regular federal income tax liability upon the exercise of the Option,
although the excess, if any, of the Fair Market Value of the Shares on the date of

8

 

exercise over the Exercise Price will be treated as income for purposes of the alternative
minimum tax for federal tax purposes and may subject the Grantee to the alternative minimum tax in
the year of exercise. However, the Internal Revenue Service issued proposed regulations which
would subject the Grantee to withholding at the time the Grantee exercises an Incentive Stock
Option for Social Security and Medicare based upon the excess, if any, of the Fair Market Value of
the Shares on the date of exercise over the Exercise Price. These proposed regulations are subject
to further modification by the Internal Revenue Service and, if adopted, would be effective only
for the exercise of an Incentive Stock Option that occurs two years after the regulations are
issued in final form.

          (b) Exercise of Incentive Stock Option Following Disability. If the Grantee’s
Continuous Service terminates as a result of Disability that is not permanent and total disability
as such term is defined in Section 22(e)(3) of the Code, to the extent permitted on the date of
termination, the Grantee must exercise an Incentive Stock Option within three (3) months of such
termination for the Incentive Stock Option to be qualified as an Incentive Stock Option. Section
22(e)(3) of the Code provides that an individual is permanently and totally disabled if he or she
is unable to engage in any substantial gainful activity by reason of any medically determinable
physical or mental impairment which can be expected to result in death or which has lasted or can
be expected to last for a continuous period of not less than twelve (12) months.

          (c) Exercise of Non-Qualified Stock Option. On exercise of a Non-Qualified Stock
Option, the Grantee will be treated as having received compensation income (taxable at ordinary
income tax rates) equal to the excess, if any, of the Fair Market Value of the Shares on the date
of exercise over the Exercise Price. If the Grantee is an Employee or a former Employee, the
Company will be required to withhold from the Grantee’s compensation or collect from the Grantee
and pay to the applicable taxing authorities an amount in cash equal to a percentage of this
compensation income at the time of exercise, and may refuse to honor the exercise and refuse to
deliver Shares if such withholding amounts are not delivered at the time of exercise.

          (d) Disposition of Shares. In the case of a Non-Qualified Stock Option, if Shares are
held for more than one year, any gain realized on disposition of the Shares will be treated as
long-term capital gain for federal income tax purposes. In the case of an Incentive Stock Option,
if Shares transferred pursuant to the Option are held for more than one year after receipt of the
Shares and are disposed more than two years after the Date of Award, any gain realized on
disposition of the Shares also will be treated as capital gain for federal income tax purposes and
subject to the same tax rates and holding periods that apply to Shares acquired upon exercise of a
Non-Qualified Stock Option. If Shares purchased under an Incentive Stock Option are disposed of
prior to the expiration of such one-year or two-year periods, any gain realized on such disposition
will be treated as compensation income (taxable at ordinary income rates) to the extent of the
difference between the Exercise Price and the lesser of (i) the Fair Market Value of the Shares on
the date of exercise, or (ii) the sale price of the Shares.

     17. Lock-Up Agreement.

9

 

          (a) Agreement. The Grantee, if requested by the Company and the lead underwriter of
any public offering of the Common Stock (the “Lead Underwriter”), hereby irrevocably agrees not to
sell, contract to sell, grant any option to purchase, transfer the economic risk of ownership in,
make any short sale of, pledge or otherwise transfer or dispose of any interest in any Common Stock
or any securities convertible into or exchangeable or exercisable for or any other rights to
purchase or acquire Common Stock (except Common Stock included in such public offering or acquired
on the public market after such offering) during the 180-day period following the effective date of
a registration statement of the Company filed under the Securities Act of 1933, as amended, or such
shorter period of time as the Lead Underwriter shall specify. The Grantee further agrees to sign
such documents as may be requested by the Lead Underwriter to effect the foregoing and agrees that
the Company may impose stop-transfer instructions with respect to such Common Stock subject to the
lock-up period until the end of such period. The Company and the Grantee acknowledge that each
Lead Underwriter of a public offering of the Company’s stock, during the period of such offering
and for the 180-day period thereafter, is an intended beneficiary of this Section 17.

          (b) No Amendment Without Consent of Underwriter. During the period from
identification of a Lead Underwriter in connection with any public offering of the Company’s Common
Stock until the earlier of (i) the expiration of the lock-up period specified in Section 17(a) in
connection with such offering or (ii) the abandonment of such offering by the Company and the Lead
Underwriter, the provisions of this Section 17 may not be amended or waived except with the consent
of the Lead Underwriter.

     18. Entire Agreement: Governing Law. The Plan and this Option Agreement constitute
the entire agreement of the parties with respect to the subject matter hereof and supersede in
their entirety all prior undertakings and agreements of the Company and the Grantee with respect to
the subject matter hereof, and may not be modified adversely to the Grantee’s interest except by
means of a writing signed by the Company and the Grantee. Nothing in the Plan and this Option
Agreement (except as expressly provided therein) is intended to confer any rights or remedies on
any persons other than the parties. The Plan and this Option Agreement are to be construed in
accordance with and governed by the internal laws of the State of Nevada without giving effect to
any choice of law rule that would cause the application of the laws of any jurisdiction other than
the internal laws of the State of Nevada to the rights and duties of the parties. Should any
provision of the Plan or this Option Agreement be determined by a court of law to be illegal or
unenforceable, such provision shall be enforced to the fullest extent allowed by law and the other
provisions shall nevertheless remain effective and shall remain enforceable.

     19. Headings. The captions used in this Option Agreement are inserted for convenience
and shall not be deemed a part of the Option for construction or interpretation.

     20. Dispute Resolution. The provisions of this Section 20 shall be the exclusive
means of resolving disputes arising out of or relating to the Plan and this Option Agreement. The
Company, the Grantee, and the Grantee’s assignees (the “parties”) shall attempt in good faith to
resolve any disputes arising out of or relating to the Plan and this Option Agreement by
negotiation between individuals who have authority to settle the controversy. Negotiations shall
be commenced by either party by notice of a written statement of the party’s position and the

10

 

name and title of the individual who will represent the party. Within thirty (30) days of the
written notification, the parties shall meet at a mutually acceptable time and place, and
thereafter as often as they reasonably deem necessary, to resolve the dispute. If the dispute has
not been resolved by negotiation, the parties agree that any suit, action, or proceeding arising
out of or relating to the Plan or this Option Agreement shall be brought in the United States
District Court for the District of Nevada (or should such court lack jurisdiction to hear such
action, suit or proceeding, in a Nevada state court in the County of Clark) and that the parties
shall submit to the jurisdiction of such court. The parties irrevocably waive, to the fullest
extent permitted by law, any objection the party may have to the laying of venue for any such suit,
action or proceeding brought in such court. THE PARTIES ALSO EXPRESSLY WAIVE ANY RIGHT THEY HAVE
OR MAY HAVE TO A JURY TRIAL OF ANY SUCH SUIT, ACTION OR PROCEEDING. If any one or more provisions
of this Section 20 shall for any reason be held invalid or unenforceable, it is the specific intent
of the parties that such provisions shall be modified to the minimum extent necessary to make it or
its application valid and enforceable.

     21. Notices. Any notice required or permitted hereunder shall be given in writing and
shall be deemed effectively given upon personal delivery, upon deposit for delivery by an
internationally recognized express mail courier service or upon deposit in the United States mail
by certified mail (if the parties are within the United States), with postage and fees prepaid,
addressed to the other party at its address as shown in this Option Agreement, or to such other
address as such party may designate in writing from time to time to the other party.

     22. Confidentiality. The Company shall provide to the Grantee, during the period the
Option is outstanding, copies of financial statements of the Company at least annually. The
Grantee understands and agrees that such financial statements are confidential and shall not be
disclosed by the Grantee, to any entity or person, for any reason, at any time, without the prior
written consent of the Company, unless required by law. If disclosure of such financial statements
is required by law, whether through subpoena, request for production, deposition, or otherwise, the
Grantee promptly shall provide written notice to Company, including copies of the subpoena, request
for production, deposition, or otherwise, within five (5) business days of their receipt by the
Grantee and prior to any disclosure so as to provide Company an opportunity to move to quash or
otherwise to oppose the disclosure. Notwithstanding the foregoing, the Grantee may disclose the
terms of such financial statements to his or her spouse or domestic partner, and for legitimate
business reasons, to legal, financial, and tax advisors.

     23. Rights as Stockholder. Until the stock certificate evidencing the Shares is
issued following the exercise of the Option (as evidenced by the appropriate entry on the books of
the Company or of a duly authorized transfer agent of the Company), no right to vote or receive
dividends or any other rights as a stockholder shall exist with respect to the Shares,
notwithstanding the exercise of the Option. The Company shall issue (or cause to be issued) such
stock certificate promptly after the Option is exercised. No adjustment will be made for a
dividend or other right for which the record date is prior to the date the stock certificate is
issued, except as provided in Section 10 of the Plan. The Grantee shall enjoy rights as a
stockholder until such time as the Grantee disposes of the Shares or the Company and/or its
assignee(s) exercises the Right of First Refusal. Upon such exercise, the Grantee shall have no
further rights as a holder of the Shares so purchased except the right to receive payment for the
Shares so

11

 

purchased in accordance with the provisions of this Option Agreement, and the Grantee shall
forthwith cause the certificate(s) evidencing the Shares so purchased to be surrendered to the
Company for transfer or cancellation.

     24. Restrictive Legends. The Grantee understands and agrees that the Company shall
cause the legends set forth below or legends substantially equivalent thereto, to be placed upon
any certificate(s) evidencing ownership of the Shares together with any other legends that may be
required by the Company or by state or federal securities laws:

THE SECURITIES REPRESENTED HEREBY HAVE NOT BEEN REGISTERED UNDER THE
SECURITIES ACT OF 1933 (THE “ACT”) OR ANY STATE SECURITIES LAWS AND
MAY NOT BE OFFERED, SOLD OR OTHERWISE TRANSFERRED, PLEDGED OR
HYPOTHECATED UNLESS AND UNTIL REGISTERED UNDER THE ACT OR, IN THE
OPINION OF COUNSEL SATISFACTORY TO THE ISSUER OF THESE SECURITIES,
SUCH OFFER, SALE OR TRANSFER, PLEDGE OR HYPOTHECATION IS IN
COMPLIANCE THEREWITH.

THE SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN
RESTRICTIONS ON TRANSFER AND A RIGHT OF FIRST REFUSAL HELD BY THE
ISSUER OR ITS ASSIGNEE(S) AS SET FORTH IN THE OPTION AGREEMENT
BETWEEN THE ISSUER AND THE ORIGINAL HOLDER OF THESE SHARES, A COPY
OF WHICH MAY BE OBTAINED AT THE PRINCIPAL OFFICE OF THE ISSUER.
SUCH TRANSFER RESTRICTIONS AND RIGHT OF FIRST REFUSAL ARE BINDING ON
TRANSFEREES OF THESE SHARES.

     IN WITNESS WHEREOF, the Company and the Grantee have executed this Option Agreement and agree
that the Option is to be governed by the terms and conditions of this Option Agreement and the
Plan.

	 	 	 	 	 	 	 
	 	 	Western Alliance Bancorporation

a Nevada corporation
	 
	 	 	 	 	 	 
	

	 	By:	 	 	 	 
	

	 	 	 	 	 	 
	

	 	Title:	 	 	 	 
	

	 	 	 	 	 	 

THE GRANTEE ACKNOWLEDGES AND AGREES THAT THE SHARES SUBJECT TO THE OPTION SHALL VEST, IF AT ALL,
ONLY DURING THE PERIOD OF THE GRANTEE’S CONTINUOUS SERVICE (NOT THROUGH THE ACT OF BEING HIRED,
BEING GRANTED THE OPTION OR ACQUIRING SHARES HEREUNDER). THE GRANTEE FURTHER ACKNOWLEDGES AND
AGREES THAT NOTHING IN THIS

12

 

OPTION AGREEMENT OR THE PLAN SHALL CONFER UPON THE GRANTEE ANY RIGHT WITH RESPECT TO FUTURE AWARDS
OR CONTINUATION OF THE GRANTEE’S CONTINUOUS SERVICE, NOR SHALL IT INTERFERE IN ANY WAY WITH THE
GRANTEE’S RIGHT OR THE RIGHT OF THE COMPANY OR RELATED ENTITY TO WHICH THE GRANTEE PROVIDES
SERVICES TO TERMINATE THE GRANTEE’S CONTINUOUS SERVICE, WITH OR WITHOUT CAUSE, AND WITH OR WITHOUT
NOTICE. THE GRANTEE ACKNOWLEDGES THAT UNLESS THE GRANTEE HAS A WRITTEN EMPLOYMENT
AGREEMENT WITH THE COMPANY TO THE CONTRARY, THE GRANTEE’S STATUS IS AT WILL.

     The Grantee acknowledges receipt of a copy of this Option Agreement and the Plan, and
represents that he or she is familiar with the terms and provisions thereof, and hereby accepts the
Option subject to all of the terms and provisions hereof and thereof. The Grantee has reviewed
this Option Agreement and the Plan in their entirety, has had an opportunity to obtain the advice
of counsel prior to executing this Option Agreement, and fully understands all provisions of this
Option Agreement and the Plan. The Grantee hereby agrees that all disputes arising out of or
relating to this Option Agreement and the Plan shall be resolved in accordance with Section 20 of
this Option Agreement. The Grantee further agrees to notify the Company upon any change in the
residence address indicated in this Option Agreement.

	 	 	 	 	 	 	 
	Dated:

	 	 	 	Signed:	 	 
	

	 	 
	 	 	 	 
	

	 	 	 	 	 	Grantee

13

 

EXHIBIT A

WESTERN ALLIANCE BANCORPORATION 2002 STOCK OPTION PLAN

EXERCISE NOTICE

____________________

Attention: Chief Financial Officer

     1. Effective as of today, ___, the undersigned (the “Grantee”) hereby elects to
exercise the Grantee’s option to purchase ___shares of the Common Stock (the “Shares”) of
Western Alliance Bancorporation, (the “Company”) under and pursuant to the Company’s 2002 Stock
Option Plan, as amended from time to time (the “Plan”) and the [ ] Incentive [ ] Non-Qualified
Stock Option Award Agreement (the “Option Agreement”) dated ___, ___. Unless
otherwise defined herein, the terms defined in the Plan shall have the same defined meanings in
this Exercise Notice.

     2. Representations of the Grantee. The Grantee acknowledges that the Grantee has
received, read and understood the Plan and the Option Agreement and agrees to abide by and be bound
by their terms and conditions. In the event the Shares purchased hereunder have not been
registered under the Securities Act of 1933, as amended, the Grantee shall, if requested by the
Company, deliver to the Company his or her Investment Representation Statement in the form attached
hereto as Exhibit 1.

     3. Delivery of Payment. The Grantee herewith delivers to the Company the full
Exercise Price for the Shares, which, to the extent selected, shall be deemed to be satisfied by
use of the broker-dealer sale and remittance procedure to pay the Exercise Price provided in
Section 6(d) of the Option Agreement.

     4. Successors and Assigns. The Company may assign any of its rights under this
Exercise Notice to single or multiple assignees, and this agreement shall inure to the benefit of
the successors and assigns of the Company. Subject to the restrictions on transfer herein set
forth, this Exercise Notice shall be binding upon the Grantee and his or her heirs, executors,
administrators, successors and assigns.

     5. Headings. The captions used in this Exercise Notice are inserted for convenience
and shall not be deemed a part of this agreement for construction or interpretation.

     6. Further Instruments. The parties agree to execute such further instruments and to
take such further action as may be reasonably necessary to carry out the purposes and intent of
this Exercise Notice.

     7. Entire Agreement. The Plan and the Option Agreement are incorporated herein by
reference and together with this Exercise Notice constitute the entire agreement of the parties
with respect to the subject matter hereof and supersede in their entirety all prior undertakings
and agreements of the Company and the Grantee with respect to the subject matter hereof, and may

1

 

not be modified adversely to the Grantee’s interest except by means of a writing signed by the
Company and the Grantee. Nothing in the Plan, the Option Agreement and this Exercise Notice
(except as expressly provided therein) is intended to confer any rights or remedies on any persons
other than the parties.

	 	 	 	 	 	 	 
	Submitted by:	 	Accepted by:
	 
	 	 	 	 	 	 
	GRANTEE:	 	WESTERN ALLIANCE BANCORPORATION
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	

	 	 	 	 	 	 
	

	 	Title:	 	 	 	 
	(Signature)
	 	 	 	 	 	 
	Address:

	 	Address:	 	 	 	 
	 
	 	 	 	 	 	 
	 	 	 	 
	 
	 	 	 	 	 	 

2

 

EXHIBIT 1

WESTERN ALLIANCE BANCORPORATION 2002 STOCK OPTION PLAN

INVESTMENT REPRESENTATION STATEMENT

	 	 	 	 	 
	GRANTEE:

	 	 	 	 
	

	 	 	 	 
	 
	 	 	 	 
	COMPANY:

	 	WESTERN ALLIANCE BANCORPORATION	 	 
	 
	 	 	 	 
	SECURITY:

	 	COMMON STOCK	 	 
	 
	 	 	 	 
	AMOUNT:
	 	 	 	 
	

	 	 	 	 
	 
	 	 	 	 
	DATE:
	 	 	 	 
	

	 	 	 	 

In connection with the purchase of the above-listed Securities, the undersigned Grantee represents
to the Company the following:

          (a) Grantee is aware of the Company’s business affairs and financial condition and has
acquired sufficient information about the Company to reach an informed and knowledgeable decision
to acquire the Securities. Grantee is acquiring these Securities for investment for Grantee’s own
account only and not with a view to, or for resale in connection with, any “distribution” thereof
within the meaning of the Securities Act of 1933, as amended (the “Securities Act”).

          (b) Grantee acknowledges and understands that the Securities constitute “restricted
securities” under the Securities Act and have not been registered under the Securities Act in
reliance upon a specific exemption therefrom, which exemption depends upon among other things, the
bona fide nature of Grantee’s investment intent as expressed herein. Grantee further understands
that the Securities must be held indefinitely unless they are subsequently registered under the
Securities Act or an exemption from such registration is available. Grantee further acknowledges
and understands that the Company is under no obligation to register the Securities. Grantee
understands that the certificate evidencing the Securities will be imprinted with a legend which
prohibits the transfer of the Securities unless they are registered or such registration is not
required in the opinion of counsel satisfactory to the Company.

          (c) Grantee is familiar with the provisions of Rule 701 and Rule 144, each promulgated under
the Securities Act, which, in substance, permit limited public resale of “restricted securities”
acquired, directly or indirectly from the issuer thereof, in a non-public offering subject to the
satisfaction of certain conditions. Rule 701 provides that if the issuer qualifies under Rule 701
at the time of the grant of the Option to the Grantee, the exercise will be exempt from
registration under the Securities Act. In the event the Company becomes subject to the reporting
requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, ninety (90) days
thereafter (or such longer period as any market stand-off agreement may require) the Securities
exempt under Rule 701 may be resold, subject to the satisfaction of certain of the conditions
specified by Rule 144, including: (1) the resale being made through a broker in an unsolicited
“broker’s transaction” or in transactions directly with a market maker (as said term is defined
under the Securities Exchange Act of 1934); and, in the case of an affiliate, (2) the

3

 

availability of certain public information about the Company, (3) the amount of Securities
being sold during any three month period not exceeding the limitations specified in Rule 144(e),
and (4) the timely filing of a Form 144, if applicable.

     In the event that the Company does not qualify under Rule 701 at the time of grant of the
Option, then the Securities may be resold in certain limited circumstances subject to the
provisions of Rule 144, which requires the resale to occur not less than one year after the later
of the date the Securities were sold by the Company or the date the Securities were sold by an
affiliate of the Company, within the meaning of Rule 144; and, in the case of acquisition of the
Securities by an affiliate, or by a non-affiliate who subsequently holds the Securities less than
two (2) years, the satisfaction of the conditions set forth in sections (1), (2), (3) and (4) of
the paragraph immediately above.

          (d) Grantee further understands that in the event all of the applicable requirements of Rule
701 or 144 are not satisfied, registration under the Securities Act, compliance with Regulation A,
or some other registration exemption will be required; and that, notwithstanding the fact that
Rules 144 and 701 are not exclusive, the Staff of the Securities and Exchange Commission has
expressed its opinion that persons proposing to sell private placement securities other than in a
registered offering and otherwise than pursuant to Rules 144 or 701 will have a substantial burden
of proof in establishing that an exemption from registration is available for such offers or sales,
and that such persons and their respective brokers who participate in such transactions do so at
their own risk. Grantee understands that no assurances can be given that any such other
registration exemption will be available in such event.

          (e) Grantee represents that Grantee is a resident of the state of ____________.

	 	 	 
	

	 	Signature of Grantee:
	 
	 	 
	

	 	 
	

	 	Date:___, ___

4

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