Business Context and Reporting Period
Company: Western Alliance Bancorporation
Filing Type: Form 8-K (Current Report)
Date of Report: September 19, 2012
Subject: Approval of the Western Alliance Bancorporation Change in Control Severance Plan (Item 5.02).
Key Financial Metrics
This filing does not contain financial performance data. The document is a corporate governance report regarding executive compensation arrangements. No revenue, profit, cash flow, margin, debt, or liquidity figures are provided in this text.
Material Changes
The Board of Directors approved a new Change in Control Severance Plan effective September 19, 2012. This plan establishes specific severance benefits for Named Executive Officers and designated executives in the event of a qualifying termination within 24 months following a Change in Control.
Guidance, Outlook, and Material Terms
Eligibility: Named executive officers for the year ended December 31, 2011, and other Board-designated executives.
Trigger Event: Qualifying termination within 24 months of a "Change in Control" (defined as dissolution, merger where the Company is not the survivor, sale of substantially all assets, or a transaction resulting in 50%+ ownership change by a new party).
Conditions: Receipt of benefits is contingent upon the executive executing a binding release agreement and waiver of claims, and complying with confidentiality, non-competition, and non-solicitation covenants.
Severance Benefits Include:
- Accrued benefits payable per normal payroll practice.
- Lump sum cash severance equal to:
- 2x Annual Base Salary (greater of the year of Change in Control or year of termination).
- 2x Annual Bonus (greater of the year of Change in Control or year of termination).
- Any unpaid annual bonus earned in the prior year.
- Pro rata annual bonus for the year of termination.
- COBRA premium reimbursement for up to 24 months.
Investor Verification Checklist
- Review the full text of the Change in Control Severance Plan filed as Exhibit 10.1 for complete legal terms.
- Verify the specific list of executives designated as eligible under the plan.
- Assess the potential financial liability of the severance plan relative to the company's current cash position.
- Confirm if this plan supersedes any prior severance agreements or if it applies only prospectively.