Exhibit 10 (f)
NON-QUALIFIED ANNUITY PERFORMANCE AGREEMENT
WESTAMERICA BANCORPORATION
This Agreement is entered into by
and between DAVID PAYNE, hereinafter referred to as the
“Employee,” and WESTAMERICA BANCORPORATION, a
California corporation, hereinafter referred to as the
“Corporation,” and is based on the following facts and
representations:
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A.
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Employee has several years of
successful experience working for Corporation, involved in
management of its banking and other businesses and desires to
continue to provide his personal services to Corporation and
continue to contribute to its success.
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B.
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The
parties, having negotiated and discussed this matter, wish to
confirm certain aspects of their compensation arrangement by this
writing. Neither of the parties hereto knows of any reason that he
or it cannot perform all of the duties and obligations imposed on
such party by this Agreement.
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NOW THEREFORE, the parties
agree:
1.
Grant of Rights
A. Employee
surrenders his rights and grants under Corporations’ 1985
Stock Option Plan (“85 Stock Plan”) and 1995 Stock
Option Plan (“95 Stock Plan”) for the calendar years
1995, 1996 and 1997, limited to all rights to become vested in and
thereby acquire up to 22,700 Restricted Performance Share
(“RPS”) granted pursuant to the 85 Stock Plan and 95
Stock Plan for said years.
B. In
consideration of such surrender and Employee’s services to
the Corporation, Corporation grants and awards to Employee certain
specific rights to receive annuity payments as deferred
compensation (the “Grants”) subject to the following
terms and conditions.
2.
Payments . The amounts to be paid for each Grant will be
calculated as a percentage of the average of Employee’s
highest three years’ total Compensation (salary and bonus),
which average will be determined at the earlier of his retirement
or age 55. The percentages and amounts will be determined by the
Committee in January of 1998, 1999, and 2000 and will be based on
the Corporation’s achievement of the Performance Goals
established for the 85 Stock Plan and the 95 Stock Plan.
3.
Qualification .
A. “Performance
Goals” for the Qualification Periods for each of the Three
Grants (“Qualification Period”) have been established
by the Board of Directors of the Corporation (“Board”)
and are set forth on Exhibit A attached hereto and
incorporated herein by this reference.
(1) Qualification
Period #1 from January 1, 1995 to December 31, 1997 with
determination to be made in January 1998;
(2) Qualification
Period #2 from January 1, 1996 to December 31, 1998 with
determination to be made in January 1999; and
(3) Qualification
Period #3 from January 1, 1997 to December 31, 1999 with
determination to be made in January 2000.
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B. If, in the opinion of the Employee
Benefits and Compensation Committee of the Board (the
“Committee”), the Corporation has attained the
specified set of Performance Goals applicable to a Grant, the
scheduled amount of annuity payments to which the Grant relates
shall become vestibule in the Employee over the applicable period
of the Employee’s continued Relationship per the vesting
provisions hereof.
C. If
the Committee determines that any set of Performance Goals was not
attained, and if no Trigger Event (as defined below) takes place,
the Grant applicable to that set of Performance Goals shall
terminate and shall be null and void regardless of Employee’s
continued Relationship with Corporation and regardless of whether
other Grants vest fully or partially in Employee.
D. Notwithstanding
the foregoing, the Committee shall have the discretion to restate
the Corporation’s financial results for purposes of such
measurement in the event that the Committee determines that a
significant accounting event or change has occurred. Determination
by the Committee shall be final, binding, and conclusive and will
be made within three months following the end of the applicable
Qualification Period.
4.
Payments . Provided Employee’s Grants become vested
per the Vesting provisions of this Agreement, Employee shall
receive annuity payments on the following terms and
conditions:
A. As
to each vested Grant, commencing with the first day of the month
following Employee’s 55 th birthday, Employee, or Employee’s
designated beneficiary, shall be entitled to receive twenty annual
payments per the schedule on Exhibit B attached hereto and
incorporated here in by this reference.
(1) If
all three Grants are fully vested in all respects, the annuity
payments will not be less than $511,950.
(2) If
such amount is unclear for any reason, the good faith determination
of the Committee shall be conclusive.
B. If
early vesting occurs by reason of a Trigger Event, Corporation
shall establish and fund a “Rabbi Trust” arrangement
for the full remaining annuity payments due to Employee.
5.
Contingent Additional Excise Tax Restoration
Payment
A. If
it is determined that any payment or distribution of any type to or
for the benefit of the Employee made by the Company, by any of its
affiliates, by any person who acquires ownership or effective
control of the Company or ownership of a substantial portion of the
Company’s assets (within the meaning of Section 180G of
the Internal Revenue Code of 1986, as amended, and the regulations
thereunder (the “Code”) or by any affiliate of such
person, whether paid or payable or distributed or distributable
pursuant to the terms of this resolution, an employment agreement
or otherwise, would be subject to the excise tax imposed by section
4999 of the Cod