<PAGE> 1
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a) OF THE
SECURITIES EXCHANGE ACT OF 1934
(AMENDMENT NO. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
[ ] Preliminary Proxy Statement
[ ] Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to 240.14a-11(c) or 240.14a-12
CVB FINANCIAL CORP.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
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(2) Aggregate number of securities to which transaction applies:
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
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(4) Proposed maximum aggregate value of transaction:
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(5) Total fee paid:
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[ ] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
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(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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<PAGE> 2
CVB FINANCIAL CORP.
NOTICE OF 2000 ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD MAY 17, 2000
TO OUR SHAREHOLDERS:
The 2000 Annual Meeting of Shareholders of CVB Financial Corp. will be
held at the Double Tree Hotel, 222 North Vineyard, Ontario, California 91764 on
Wednesday, May 17, 2000 at 7:00 p.m. local time.
At our meeting, we will ask you to act on the following matters:
1. ELECTION OF DIRECTORS. Elect seven persons to the Board of Directors
to serve for a term of one year. The following seven persons are the nominees:
George A. Borba James C. Seley
John A. Borba D. Linn Wiley
Ronald O. Kruse San Vaccaro
John J. LoPorto
2. STOCK OPTION PLAN. Approve the CVB Financial Corp. 2000 Stock Option
Plan.
3. RATIFICATION OF APPOINTMENT OF INDEPENDENT PUBLIC ACCOUNTANTS. Ratify
the appointment of Deloitte & Touche as independent public accountants for 2000.
4. OTHER BUSINESS. Transact any other business which properly comes
before the meeting.
Our Bylaws provide for the nomination of directors in the following
manner:
"Nominations for election of members of the Board of Directors may be
made by the Board of Directors or by any shareholder of any outstanding class of
voting stock of the corporation entitled to vote for the election of directors.
Notice of intention to make any nominations, other than by the Board of
Directors, shall be made in writing and shall be received by the President of
the corporation no more than 60 days prior to any meeting of shareholders called
for the election of directors, and no more than 10 days after the date the
notice of such meeting is sent to shareholders pursuant to Section 2.2 of these
bylaws; provided, however, that if only 10 days' notice of the meeting is given
to shareholders such notice of intention to nominate shall be received by the
President of the corporation not later than the time fixed in the notice of the
meeting for the opening of the meeting. Such notification shall contain the
following information to the extent known to the notifying shareholder: (a) the
name and address of each proposed nominee; (b) the principal occupation of each
proposed nominee; (c) the number of shares of voting stock of the corporation
owned by each proposed nominee; (d) the name and residence address of the
notifying shareholder; and (e) the number of shares of voting stock of the
corporation owned by the notifying shareholder. Nominations not made in
accordance herewith shall be disregarded by the then chairman of the meeting,
and the inspectors of election shall then disregard all votes cast for each
nominee."
<PAGE> 3
If you were a shareholder of record at the close of business on March
27, 2000, you may vote at the meeting or at any postponement or adjournment of
the meeting.
IT IS IMPORTANT THAT ALL SHAREHOLDERS VOTE. WE URGE YOU TO SIGN AND RETURN THE
ENCLOSED PROXY AS PROMPTLY AS POSSIBLE, REGARDLESS OF WHETHER OR NOT YOU PLAN TO
ATTEND THE MEETING IN PERSON. IF YOU DO ATTEND THE MEETING, YOU MAY THEN
WITHDRAW YOUR PROXY AND VOTE IN PERSON.
By Order of the Board of Directors
/S/ DONNA MARCHESI
DONNA MARCHESI
Corporate Secretary
Dated: April 10, 2000
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<PAGE> 4
PROXY STATEMENT FOR
CVB FINANCIAL CORP.
701 NORTH HAVEN AVENUE, SUITE 350
ONTARIO, CALIFORNIA 91764
(909) 980-4030
This proxy statement contains information about the annual meeting of
shareholders of CVB Financial Corp. to be held on Wednesday, May 17, 2000
beginning at 7:00 p.m., local time, at the Double Tree Hotel, 222 North
Vineyard, Ontario, California, 91764, and at any postponements or adjournments
of the meeting.
INFORMATION ABOUT THE ANNUAL MEETING AND VOTING
WHY DID YOU SEND ME THIS PROXY STATEMENT?
We sent you this Proxy Statement and the enclosed proxy card because the
Board of Directors is soliciting your vote at the 2000 Annual Meeting of
Shareholders.
This proxy statement summarizes the information you need to know to cast
an informed vote at the meeting. However, you do not need to attend the meeting
to vote your shares. Instead, you may simply complete, sign and return the
enclosed proxy card.
We will begin sending this proxy statement, notice of annual meeting and
the enclosed proxy card on or about April 10, 2000 to all shareholders entitled
to vote. The record date for those entitled to vote is March 27, 2000. On March
27, 2000, there were 24,998,881 shares of our common stock outstanding. The
common stock is our only class of stock outstanding. We are also sending our
summary annual report for the fiscal year ended December 31, 1999 along with
this proxy statement. The summary annual report is not to be deemed a part of
the material for the solicitation of proxies.
HOW DO I VOTE BY PROXY?
Whether you plan to attend the meeting or not, we urge you to complete,
sign and date the enclosed proxy card and to return it promptly in the envelope
provided. Returning the proxy card will not affect your right to attend the
meeting and vote.
If you properly fill in your proxy card and send it to us in time to
vote, your "proxy" (one of the individuals named on your proxy card) will vote
your shares as you have directed. If you sign the proxy card but do not make
specific choices, your proxy will vote your shares as recommended by the Board
of Directors as follows:
- "FOR" the election of all seven nominees for director;
- "FOR" approval of the Stock Option Plan; and
- "FOR" ratification of the appointment of Deloitte & Touche as
independent accountants for 2000.
If any other matter is presented, your proxy will vote in accordance
with the recommendation of the Board of Directors, or, if no recommendation is
given, in their own
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discretion. At the time this proxy statement went to press, we knew of no
matters which needed to be acted on at the meeting, other than those discussed
in this proxy statement.
HOW MANY VOTES DO I HAVE?
Each share of common stock entitles you to one vote. The proxy card
indicates the number of shares of common stock that you own. However, in the
election of directors, you are entitled to cumulate your votes if you are
present at the meeting, the nominee's(s') name(s) have properly been placed in
nomination, and you have given notice at the meeting prior to the actual voting
of your intention to vote your shares cumulatively. Cumulative voting allows you
to give one nominee as many votes as is equal to the number of directors to be
elected, multiplied by the number of shares you own, or to distribute your votes
in the same fashion between two or more nominees. The return of an executed
proxy grants the Board of Directors the discretionary authority to also cumulate
votes.
CAN I CHANGE MY VOTE AFTER I RETURN MY PROXY CARD?
Yes. Even after you have submitted your proxy, you may change your vote
at any time before the proxy is exercised if you file with CVB Financial's
Secretary either a notice of revocation or a duly executed proxy bearing a later
date. The powers of the proxy holders will be suspended if you attend the
meeting in person and so request, although attendance at the meeting will not by
itself revoke a previously granted proxy.
HOW DO I VOTE IN PERSON?
If you plan to attend the meeting and vote in person, we will give you a
ballot form when you arrive. However, if your shares are held in the name of
your broker, bank or other nominee, you must bring a proxy card and letter from
the nominee authorizing you to vote the shares and indicating that you are the
beneficial owner of the shares on March 27, 2000, the record date for voting.
WHAT CONSTITUTES A QUORUM?
The presence at the meeting, in person or by proxy, of the holders of a
majority of the shares of common stock outstanding on the record date will
constitute a quorum, permitting the conduct of business at the meeting. Proxies
which are marked as abstentions will be included in the calculation of the
number of shares considered to be present at the meeting.
WHAT VOTE IS REQUIRED FOR EACH PROPOSAL?
The seven nominees for director who receive the most votes will be
elected. So, if you do not vote for a particular nominee or you indicate
"withhold authority to vote" for a particular nominee on your proxy card, your
vote will not count either "for" or "against" the nominee. In order to approve
the Stock Option Plan and ratify the selection of independent accountants, the
Stock Option Plan and the accountants must receive the affirmative vote of a
majority of the votes represented and voting at the annual meeting which also
must be at least a majority of the required quorum. So, if you "abstain" from
voting, it has the same effect as if you voted "against" these proposals. In
addition, if you fail to instruct your brokers on how to
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vote on the Stock Option Plan, your broker will be unable to vote on this
proposal. This will have no effect on this proposal since those shares for which
brokers are unable to vote will not be considered voting at this annual meeting
for purposes of approving the Stock Option Plan.
WHAT ARE THE COSTS OF SOLICITATION OF PROXIES?
We will bear the costs of this solicitation, including the expense of
preparing, assembling, printing and mailing this Proxy Statement and the
material used in this solicitation of proxies. The proxies will be solicited
principally through the mails, but CVB Financial's directors, officers and
regular employees may solicit proxies personally or by telephone. Although there
is no formal agreement to do so, we may reimburse banks, brokerage houses and
other custodians, nominees and fiduciaries for their reasonable expense in
forwarding these proxy materials to their principals. In addition, we may pay
for and utilize the services of individuals or companies we do not regularly
employ in connection with the solicitation of proxies.
STOCK OWNERSHIP
WHO ARE THE LARGEST OWNERS OF CVB FINANCIAL'S COMMON STOCK?
The following table shows the beneficial ownership of common
stock as of March 27, 2000 by each person we know to be the beneficial owner of
more than five percent of the outstanding shares of common stock. "Beneficial
ownership" is a technical term broadly defined by the Securities and Exchange
Commission to mean more than ownership in the usual sense. So, for example, you
beneficially own CVB Financial's common stock not only if you hold it directly,
but also if you indirectly, through a relationship, contract or understanding,
have, or share, the power to vote the stock, to sell it or you have the right to
acquire it within 60 days of March 27, 2000:
<TABLE>
<CAPTION>
COMMON STOCK
BENEFICIALLY OWNED
------------------------------
NUMBER PERCENT
NAME ADDRESS OF SHARES OF CLASS
- ------------------- ------------------- ------------ --------
<S> <C> <C> <C>
George A. Borba 701 N. Haven Avenue 3,517,478(1) 14.18%
Ontario, CA 91764
Charles M. Magistro 701 N. Haven Avenue 1,460,260 5.91%
Ontario, CA 91764
John Vander Schaaf 500 Wells Lane 1,151,700(2) 5.47%
Ripon, CA 95366
</TABLE>
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- ------------------
(1) Includes 83,043 shares which Mr. Borba has the right to acquire by the
exercise of stock options.
(2) Includes 66,435 shares which Mr. Vander Schaaf has the right to acquire by
exercise of stock options.
HOW MUCH STOCK DO CVB FINANCIAL'S DIRECTORS AND OFFICERS OWN?
The following table shows the beneficial ownership of CVB Financial's
common stock as of March 27, 2000 by (i) our President and Chief Executive
Officer; (ii) our four most highly compensated executive officers in 1999; (iii)
each director and nominee for director and (iv) by all directors and executive
officers as a group.
<TABLE>
<CAPTION>
COMMON STOCK
BENEFICIALLY OWNED
----------------------------
NUMBER PERCENT
NAME OF SHARES(1) OF CLASS(2)
- ---- ------------ -----------
<S> <C> <C>
George A. Borba (3) 3,517,478 14.18%
Chairman of the Board and Nominee
John A. Borba (3) 820,815 3.31
Director and Nominee
Ronald O. Kruse (3) 596,790 2.41
Director and Nominee
John J. LoPorto (4) 453,247 1.83
Director and Nominee
James C. Seley (5) 51,897 *
Director and Nominee
San Vaccaro (6) 123,527 *
Director and Nominee
D. Linn Wiley, 441,179 1.77
President, Chief
Executive Officer, Director and Nominee (7)
Frank Basirico, 34,711 *
Executive Vice President
Edward J. Biebrich, Jr. 21,937 *
Executive Vice President and
Chief Financial Officer (8)
Jay W. Coleman, 147,237 *
Executive Vice President (9)
Edwin Pomplun, 14,780 *
Executive Vice President (10)
</TABLE>
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<PAGE> 8
<TABLE>
<S> <C> <C>
Current Directors and Executive Officers 6,223,598 25.08
(11 persons) (11)
</TABLE>
- ------------------
* Less than 1%.
(1) Except as otherwise noted below, each person directly or indirectly has
sole or shared voting and investment power with respect to the shares
listed.
(2) The percentage for each of these persons or group is based upon the
total number of shares of CVB Financial's Common Stock outstanding as of
the Record Date plus the shares which the respective individual or group
has the right to acquire within 60 days after March 27, 2000 by the
exercise of stock options.
(3) Includes 83,043 shares which each individual can acquire within 60 days
after March 27, 2000 by the exercise of stock options.
(4) Includes 59,435 shares which Mr. LoPorto can acquire within 60 days
after March 27, 2000 by exercise of stock options. Includes 10,746
shares held by Mr. LoPorto as custodian for his grandchildren.
(5) Includes 49,826 shares which Mr. Seley can acquire within 60 days after
March 27, 2000 by the exercise of stock options.
(6) Includes 65,250 shares which Mr. Vaccaro can acquire within 60 days
after March 27, 2000 by the exercise of stock options.
(7) Includes 152,347 shares which Mr. Wiley can acquire within 60 days after
March 27, 2000 by the exercise of stock options.
(8) Includes 16,500 shares which Mr. Biebrich can acquire within 60 days
after March 27, 2000 by the exercise of stock options.
(9) Includes 78,987 shares which Mr. Coleman can acquire within 60 days
after March 27, 2000 by the exercise of stock options.
(10) Includes 12,718 shares which Mr. Pomplun can acquire within 60 days
after March 27, 2000 by the exercise of stock options.
(11) Includes 684,192 shares which members of the group can acquire within 60
days after March 27, 2000 by the exercise of stock options.
DISCUSSION OF PROPOSALS RECOMMENDED BY THE BOARD
PROPOSAL 1: ELECTION OF DIRECTORS
We have nominated seven directors for election at the annual meeting,
which is the number of slots fixed for the election of directors.
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We will nominate the persons named below, all of whom are present
members of CVB Financial's Board of Directors, for election to serve until the
2001 Annual Meeting of Shareholders. Each of these persons is also a member of
the Board of Directors of our principal subsidiary, Citizens Business Bank. The
Board will cast its votes to effect the election of these nominees. If any
nominee is unable to serve, your proxy may vote for another nominee proposed by
the Board.
THE NOMINEES
The directors standing for reelection are:
<TABLE>
<CAPTION>
YEAR FIRST
ELECTED
PRINCIPAL OCCUPATION OR APPOINTED
NAME AND POSITION FOR PAST FIVE YEARS AGE A DIRECTOR
- ----------------- -------------------- --- ------------
<S> <C> <C> <C>
George A. Borba (1) Dairy Farmer, George Borba 67 1981
Chairman of the Board & Son Dairy
John A. Borba (1) Dairy Farmer, John Borba & 72 1981
Director Sons
Ronald O. Kruse Chairman, Kruse Investment 61 1981
Vice Chairman of the Board Co., Inc. and Feed
and Director Commodities, LLC(2)
John J. LoPorto Investor 67 1981
Director
James C. Seley Trustee, Seley Family Trust 58 1996
Director
San Vaccaro Attorney 67 1999
Director
D. Linn Wiley President and Chief 61 1991
President, Chief Executive Executive Officer, CVB
Officer and Director Financial Corp. and
Citizens Business Bank
</TABLE>
- -------------------------
(1) George A. Borba and John A. Borba are brothers.
(2) Prior to joining Kruse Investment Co., Inc., Mr. Kruse was Chairman of
O.H. Kruse Grain & Milling from 1974 through August 31, 1995.
THE BOARD OF DIRECTORS AND COMMITTEES
The Board of Directors oversees our business and affairs. The Board also
has ten standing committees including an Audit Committee, a Personnel Committee
and a Stock Option Committee all of which, except for the Stock Option
Committee, are also committees of the Bank. The Board does not have a nominating
committee. The procedures for nominating directors, other than by the Board of
Directors itself, are set forth in the bylaws and in the Notice of Annual
Meeting of Shareholders.
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THE AUDIT COMMITTEE
In 1999 John Borba chaired the Audit Committee, which held twelve (12)
meetings in 1999. Messrs. R. Kruse, J. LoPorto, and J. Seley are also members of
this committee. The purpose of the Audit Committee is to direct the activities
of the external auditors of the Bank to fulfill the legal and technical
requirements necessary to adequately protect the directors, shareholders and
employees. The Audit Committee also recommends to the Board of Directors the
appointment of independent accountants and makes certain that the external
auditors have the necessary freedom and independence to freely examine all the
Bank records.
THE PERSONNEL COMMITTEE
In 1999, Mr. Charles Magistro, who retired in December 1999, chaired the
Personnel Committee, which held three (3) meetings during 1999. Messrs. G.
Borba, J. Borba, R. Kruse, LoPorto, J. Seley, S. Vaccaro and D.L. Wiley are also
members of this committee. This committee approves issues related to the
compensation of the officers and employees of Citizens Business Bank.
THE STOCK OPTION COMMITTEE
In 1999, Mr. LoPorto chaired the Stock Option Committee, which held one
meeting during 1999. Messrs. J. Borba, R. Kruse, C. Magistro, J. Seley and S.
Vaccarro also served on this committee in 1999. The Stock Option Committee
administers our stock option plan, including making decisions regarding the
grant of options.
THE NUMBER OF MEETINGS ATTENDED
During 1999, the Board of Directors held eighteen (18) meetings, and the
Board of Directors of the Bank held fifteen (15) meetings. All of the directors
of CVB Financial and Citizens Business Bank during 1999 attended at least 75% of
the aggregate of (i) the total number of CVB Financial and Citizens Business
Bank Board meetings and (ii) the total number of meetings held by all committees
of the Board of Directors of CVB Financial or Citizens Business Bank on which he
served during 1999, except for Mr. Vaccaro who was appointed to the Board of
Directors of CVB Financial and Citizens Business Bank in October 1999 in
connection with the acquisition of Orange National Bancorp and Orange National
Bank.
EXECUTIVE COMPENSATION
HOW DO WE COMPENSATE DIRECTORS?
We compensate our directors and the directors of Citizens Business Bank
with a fee for attendance at Board and committee meetings. Each director
received $3,221 per month for Board and Committee meetings, except for the
Chairman of the Board (Mr. George Borba) who received $9,201 per month for
attendance at such meetings. Mr. Wiley does not receive any fees for serving as
a director of CVB Financial or Citizens Business Bank. We paid a total of
$313,335 in 1999 as directors' fees. Pursuant to CVB Financial's 1991 stock
option plan, each
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of CVB Financial's non-employee directors is entitled to receive stock options
after completing five years of service. All of CVB Financial directors have
received their full grant except for Mr. Seley, who became a director in 1996
and Mr. Vaccaro who became a director in 1999. These options were granted over a
five-year period after each non-employee director completed a year of service
with CVB Financial. In addition, the Company pays a health insurance premium for
each our non-employee directors. In 1999, the premium averaged approximately
$4,955 for each non-employee director.
HOW DO WE COMPENSATE EXECUTIVE OFFICERS?
Summary of Cash and Certain Other Compensation
The tables on pages 11 and 12 show salaries and bonuses paid during the
last three years, options granted in fiscal 1999 and 1999 fiscal year-end option
values for our Chief Executive Officer and our next four most highly compensated
executive officers who are our named executives.
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SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION> LONG-TERM
COMPENSATION
ANNUAL COMPENSATION ------------
------------------------------------------- AWARDS
OTHER ANNUAL ------------ All Other
NAME AND PRINCIPAL POSITION YEAR SALARY($) BONUS($) COMPENSATION($)(1) OPTIONS(2) Compensation($)(3)
- --------------------------- ---- ---------- --------- ------------------ ------------ ------------------
<S> <C> <C> <C> <C> <C> <C>
D. LINN WILEY 1999 390,000 323,700 -- -- 12,800
President and Chief Executive Officer 1998 380,000 303,240 -- 34,375 12,800
1997 751,522(4) 224,475 -- -- 12,000
FRANK BASIRICO 1999 155,000 69,750 -- -- 12,800
Executive Vice President and Senior Loan 1998 145,000 54,375 -- -- 12,800
Officer of the Bank 1997 135,000 40,500 -- -- 7,769
JAY W. COLEMAN 1999 169,000 76,050 -- -- 12,800
Executive Vice President of Sales and 1998 162,500 59,719 -- 6,875 12,800
Service Division of the Bank 1997 153,500 46,050 -- - 12,000
EDWIN POMPLUN 1999 123,600 38,934 -- -- 12,800
Executive Vice President and Trust Division 1998 120,000 45,000 -- 2,750 12,053
Manager of the Bank 1997 115,000 31,913 -- 13,406 --
EDWARD J. BIEBRICH, JR. 1999 166,500 72,428 -- -- 12,800
Chief Financial Officer of the Company and 1998 160,000 66,000 -- 41,250 --
Executive Vice President/Chief Financial 1997 -- -- -- -- --
Officer of the Bank
</TABLE>
- ---------------------
(1) The amount of the aggregate of the other annual compensation did not
exceed the lesser of $50,000 or 10% of the total of annual salary and
bonus for the particular executive officer.
(2) Represents stock options we granted, retroactively adjusted, as
appropriate, for the five for four stock split paid in January 2000, the
10% stock dividend distributed in January 1999 and January 1997, and the
three for two stock split paid in January 1998.
(3) Represents amounts the Bank contributed to the Profit Sharing Plan and
allocated to the Named Executives' vested or unvested account under such
plan.
(4) Includes $386,522 for 1997 that represented the dollar value of shares
of common stock we granted to Mr. Wiley pursuant to his employment
agreement.
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<PAGE> 13
Option Exercises and Holdings
The following table provides information with respect to the
named executive officers concerning their exercise of options during the 1999
fiscal year and their year-end option holdings. We have retroactively updated
the share numbers in this table to take into account the five for four stock
split we distributed on January 14, 2000. CVB Financial did not make any option
grants to any named executive officers in 1999.
AGGREGATED OPTION(1) EXERCISES IN FISCAL YEAR 1999
AND FISCAL YEAR-END OPTION VALUES
<TABLE>
<CAPTION>
Value of Unexercised
Number of Unexercised In-the-Money Options at
Shares Acquired Options at 12/31/99(#)(2) 12/31/99 ($)(3)
on Exercise(2) Value Realized -------------------------- --------------------------
Name (#) ($) Exercisable Unexercisable Exercisable Unexercisable
- ---- --------------- -------------- ----------- ------------- ----------- ------------
<S> <C> <C> <C> <C> <C> <C>
D. Linn Wiley -- -- 152,347 29,222 2,317,524 61,036
Frank Basirico 34,711 240,181 0 18,650 -- 210,234
Jay W. Coleman -- -- 78,987 8,875 1,234,147 51,277
Edwin Pomplun -- -- 12,168 14,781 120,579 114,453
Edward J. Biebrich, Jr. -- -- 8,250 33,000 1,155 4,620
</TABLE>
- ---------------------------
(1) We have no plans pursuant to which stock appreciation rights may be
granted.
(2) Retroactively adjusted for the five for four stock split we distributed
on January 14, 2000.
(3) Value of unexercised "in-the-money" options is the difference between
the fair market value of the securities underlying the options and the
exercise or base price of the options as of December 31, 1999.
EMPLOYMENT AGREEMENT WITH OUR PRESIDENT AND CHIEF EXECUTIVE OFFICER
On August 8, 1991, we entered into an employment agreement with Mr.
Wiley which sets forth his compensation as President and Chief Executive Officer
of CVB Financial and Citizens Business Bank. The agreement provides for an
annual base salary of at least $300,000. This base salary is reviewed and
adjusted on an annual basis at the discretion of the Board of Directors. The
agreement further provides for Mr. Wiley to receive an annual bonus of $200,000
for each year after 1991, although Mr. Wiley's actual bonus may be more or less
than $200,000 depending on the attainment of certain performance goals. In
addition, as compensation for each full year of service between 1992 and 1997,
Mr. Wiley received an unrestricted, fully vested and non-forfeitable common
stock grant, which stock has already been issued. In the event there is a change
in control of CVB Financial, or Mr. Wiley is terminated for any reason, other
than for cause, he is entitled to receive a sum equal to one year's base salary
at the rate being paid to him at the time he is terminated, unless he accepts
employment with the
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acquiring company. Additionally, the agreement provides for certain other
benefits, including an option grant, which was made in 1991, the use of an
automobile, a country club membership, participation in the Bank's Profit
Sharing Plan and medical and life insurance benefits.
In addition, pursuant to the terms of our 1991 Stock Option Plan, upon a
reorganization, merger, or consolidation of the Company with one or more
corporations as a result of which we will not be the surviving or resulting
corporation, or a sale of substantially all the assets of the Company to another
person, or a reverse merger in which we are the surviving corporation but the
shares of our stock outstanding immediately preceding the merger are converted
by virtue of the merger into other property, all outstanding options Mr. Wiley
may hold under the our 1991 Stock Option Plan, whether vested or not vested,
will become immediately exercisable.
SEVERANCE COMPENSATION AGREEMENTS WITH CERTAIN OTHER EXECUTIVE OFFICERS
In September 1996, the Bank entered into severance compensation
agreements with Messrs. Basirico, Coleman and Pomplun. In 1998, the Bank entered
into a Severance Compensation Agreement with Mr. Biebrich. These agreements
provide that in the event a "Change of Control," as described below, occurs
during the executive's employment and (i) the executive's employment is
terminated by us or Citizens Business Bank or any successor, other than for
cause, within one year of the completion of such Change of Control, or (ii) the
executive terminates or resigns employment for Good Reason, as described below,
within one year of the completion of a Change in Control, the executive shall
receive an amount equal to the executive's annual base compensation for the last
calendar year immediately preceding the Change in Control. This amount will be
paid in a lump sum within five days after the effective date of termination of
the executive's employment.
A "Change in Control" occurs if, among other things:
(i) any person or group, other than a director or officer
serving since September 1996 acquires (or has acquired during the 12 month
period ending on the date of the most recent acquisition) ownership of stock of
the Company or the Bank possessing more than 50% of the total voting power of
the Company's or the Bank's stock;
(ii)majority of the members of the Company's or the Bank's
directors is replaced during any 12 month period by directors whose appointment
or election is not endorsed by a majority of the members of the Company's or the
Bank's board prior to the date of the appointment or election;
(iii) a merger occurs where the holders of the Bank's or the
Company's voting stock immediately prior to the effective date of such merger
own less than 50% of the voting stock of the entity surviving such merger; or
(iv) any one person or group, acquires (or has acquired during
the twelve month period ending on the date of the most recent acquisition by
such person or persons) assets from the Bank that have a total fair market value
greater than 50% of the total fair market value of all of the Bank's assets
immediately before the acquisition or acquisitions. A transfer of
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<PAGE> 15
assets will not be treated as a change in the ownership of such assets if the
assets are transferred to:
(A) an entity, 50% or more of the total value or voting
power of which is owned directly or indirectly by CVB Financial or Citizens
Business Bank;
(B) a person, or more than one person acting as a group,
that owns, directly or indirectly, 50% or more of the total value or voting
power of all the outstanding stock of CVB Financial or Citizens Business Bank;
or
(C) an entity, at least 50% of the total value or voting
power is owned, directly or indirectly by a person who owns, directly or
indirectly, 50% or more of the total value or voting power of all the
outstanding stock of Citizens Business Bank.
"Good Reason" includes (i) the executive's then current level of annual
base salary or employee benefit coverage is reduced; (ii) the executive suffers
a material diminution in, among others, title, authority or responsibilities; or
(iii) the executive's principal business office is relocated by more than fifty
miles from its existing location.
In addition, pursuant to the terms of CVB Financial's 1991 Stock Option
Plan, upon a reorganization, merger, or consolidation of the Company with one or
more corporations as a result of which CVB Financial will not be the surviving
or resulting corporation, or a sale of substantially all the assets of CVB
Financial to another person, or a reverse merger in which CVB Financial is the
surviving corporation but the shares of CVB Financial's stock outstanding
immediately preceding the merger are converted by virtue of the merger into
other property, all outstanding options under CVB Financial's 1991 Stock Option
Plan, whether vested or not vested, become immediately exercisable.
REPORT ON EXECUTIVE COMPENSATION
The Report of the Personnel Committee and the Stock Option Committee
should not be deemed incorporated by reference into any filing under the
Securities Act of 1933 or under the Securities Exchange Act of 1934, except to
the extent that we specifically incorporate the information contained in the
report by reference.
REPORT OF THE PERSONNEL COMMITTEE
AND THE STOCK OPTION COMMITTEE
WHAT IS OUR PHILOSOPHY ON EXECUTIVE COMPENSATION?
We have adopted a basic philosophy and practice of offering a
compensation program designed to attract and retain highly qualified employees.
Our compensation practices encourage and motivate these individuals to achieve
superior performance. This underlying philosophy pertains specifically to
executive compensation, as well as employee compensation at all other levels
throughout the organization.
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<PAGE> 16
There are three principal components of the executive compensation
program. They include base salary compensation, bonus compensation (performance
compensation) and long-term incentive compensation.
BASE SALARY
For 1999, we determined the base salary compensation for each of the
Company's executive officers. This includes all of the named executives. We
predicate the base salary on the executive's ability, experience and past and
potential performance and contribution to CVB Financial and Citizens Business
Bank. The base salary range is based, in part, on our analysis of salary surveys
from the California Bankers Association and the SIRS survey prepared by
Organization Resource Counselors, Inc. Furthermore, we establish the base salary
so that we will have the ability to increase these base salaries in future years
based on the executive's performance. The full Board of Directors approved both
the salary range and the actual base salary for each executive officer.
We will evaluate and adjust the range of each executive's base salary,
if appropriate, in subsequent years, based on future salary surveys, comparable
salary information and other considerations. Base salary adjustments for each
executive will be predicated primarily on performance. We conduct performance
evaluations at least annually. We base the evaluations on results achieved.
These results are measured against specific performance standards established at
the beginning or during the course of the year. For example, specific
performance standards include, among other things, deposit growth, loan growth,
fee income, expense control, net earnings, return on equity and return on
assets.
BONUS
We base bonus compensation on Citizens Business Bank's return on equity
and other specific performance criteria. Citizens Business Bank must achieve a
minimum return on equity for anyone to be eligible for a bonus. This criterion
provided for a minimum return on average equity of 15.00% for 1999. Citizens
Business Bank's actual return on average equity for 1999 was 20.44%. The
individual performance objectives and standards relate to specific results where
the executive has substantial influence and accountability. The full Board of
Directors approved all executive officers' bonuses for service during 1999.
WHAT KIND OF LONG-TERM INCENTIVE COMPENSATION DOES CVB FINANCIAL OFFER?
We have two compensation plans that provide long-term incentives for our
executive officers. They include a Stock Option Plan and a Profit Sharing Plan.
The Stock Option Plan aligns the interests of key employees, including
the Named Executives, with those of our shareholders. We provide these employees
with an incentive to achieve superior performance by granting them long-term
options to purchase Company Common Stock at a fixed exercise price that equals
the fair market value of the underlying stock on the date of the grant. The
Stock Option Committee administers the Stock Option Plan. This committee has the
authority to select the key employees eligible for the stock options and the
number of options they will receive. The members of the Stock Option
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<PAGE> 17
Committee do not utilize any performance goals in determining the number of
options to be granted, nor do they consider the number of options previously
granted to an executive officer. Rather, the members base the award of stock
options on their own analysis of that employee's contribution to CVB Financial,
including an assessment of the employee's responsibilities, as well as the
employee's commitment to CVB Financial's future. The amount of compensation an
optionee may receive pursuant to the option is based solely on an increase in
the value of the Company's common stock after the date of the grant or award.
In 1999, the Stock Option Committee did not award any stock options to
the executive officers. In 1998, the Company's shareholders approved an
amendment to the Stock Option Plan as a result of the enactment of Section
162(m) of the Internal Revenue Code which limits the deductibility of
compensation paid to certain executive officers in excess of $1 million dollars
per year. Stock options awarded under the Option Plan now qualify for exclusion
under Section 162(m) of the Code as performance-based compensation.
The Profit Sharing Plan primarily provides retirement benefits to all
eligible employees, including Named Executives. It also has death and disability
features. Employees become eligible upon completing at least one year of
service. Annual contributions are made solely by CVB Financial. These
contributions are entirely discretionary, and are approved by the Board of
Directors based on CVB Financial's earnings and return on equity. For 1999, CVB
Financial contributed $1,186,477 or 8% of total employee base salary and bonus,
to the Profit Sharing Plan. We allocate contributions proportionately to the
accounts of plan participants based on their base salaries and bonus. Plan
participants become fully vested in these amounts upon reaching seven years of
service.
HOW DO WE COMPENSATE OUR PRESIDENT AND CHIEF EXECUTIVE OFFICER?
Mr. Wiley, the President and Chief Executive Officer of CVB Financial
and the Bank, received compensation for his services during 1999 based primarily
upon his rights under his employment agreement with CVB Financial and Citizens
Business Bank. We discuss this contract under the heading "Employment Agreement
with Our President and Chief Executive Officer." Mr. Wiley is also eligible to
receive a discretionary annual bonus pursuant to his employment agreement. We
base his bonus on specific performance achievements as outlined above for other
executive officers. Mr. Wiley may receive a bonus of up to and including 83% of
his base salary under this plan. He received an annual bonus of $323,700, or 83%
of base salary, for his services in 1999. This bonus was predicated on return on
average equity, deposit growth, loan growth, net loan losses and operating
efficiency. In addition to the benefits his employment agreement provides, Mr.
Wiley is an eligible participant in our Profit Sharing Plan. He received a
vested allocation of $12,800 for 1999. This represents his proportionate share
of the aggregate employer contribution authorized by the Board of Directors for
1999.
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Dated: March 27, 2000
THE PERSONNEL COMMITTEE
GEORGE A. BORBA, Chairman
JOHN A. BORBA
RONALD O. KRUSE
JOHN LoPORTO
JAMES C. SELEY
D. LINN WILEY
SAN VACCARO
THE STOCK OPTION COMMITTEE
JOHN BORBA
RONALD O. KRUSE
JOHN J. LoPORTO, Chairman
JAMES C. SELEY
SAN VACCARO
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
None of the members of the Personnel Committee or the Stock Option
Committee during 1999 has ever been an officer or employee of CVB Financial or
any of its subsidiaries, except for Mr. Wiley, who is the President and Chief
Executive Officer of CVB Financial and the Bank and a member of the Personnel
Committee. The Personnel Committee made all decisions regarding compensation of
executive officers during 1999, other than those related to stock options or the
base salary of Mr. Wiley.
PERFORMANCE GRAPH
The following graph compares the yearly percentage change in CVB
Financial's cumulative total shareholder return (stock price appreciation plus
reinvested dividends) on Common Stock with (i) the cumulative total return of
the American Stock Exchange market index, and (ii) a published index comprised
by Media General Financial Services, Inc. of banks and bank holding companies in
the "Pacific States," which are Alaska, California, Hawaii, Oregon and
Washington (the industry group line depicted below). The graph assumes an
initial investment of $100 and reinvestment of dividends. Points on the graph
represent the performance as of the last business day of each of the years
indicated. The graph is not necessarily indicative of future price performance.
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The graph shall not be deemed filed or incorporated by reference into
any filing under the Securities Act of 1933 or under the Securities Exchange Act
of 1934, except to the extent that we specifically incorporate this graph by
reference.
[INSERT GRAPH]
Period Ended December 31, 1994 Through December 31, 1999
COMPARISON OF FIVE YEAR CUMULATIVE TOTAL RETURN
<TABLE>
<CAPTION>
1995 1996 1997 1998 1999
------ ------ ------ ------ ------
<S> <C> <C> <C> <C> <C> <C>
CVB Financial Corp. 100 96.27 149.99 297.42 274.74 288.48
Industry Index 100 159.81 200.22 360.53 337.65 344.27
AMEX Market Index
100 128.90 136.01 163.66 161.44 201.27
</TABLE>
18
<PAGE> 20
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Some of the directors and executive officers of CVB Financial and the
companies with which they are associated were customers of, and had banking
transactions with, Citizens Business Bank in the ordinary course of its business
during 1999, and the Bank expects to have such banking transactions in the
future. Citizens Business Bank made all of these loans and commitments on
substantially the same terms, including interest rates, collateral and repayment
terms, as those prevailing at the time for comparable transactions with other
persons of similar creditworthiness. In our opinion, these transactions did not
involve more than a normal risk of collectibility or present other unfavorable
features.
DID DIRECTORS AND OFFICERS COMPLY WITH THEIR SECTION 16(a) BENEFICIAL OWNERSHIP
REPORTING COMPLIANCE REQUIREMENTS IN 1999?
Section 16(a) of the Securities Exchange Act of 1934 requires our
executive officers and directors, and persons who own more than ten percent of
CVB Financial's equity securities, to file reports of ownership and changes in
ownership with the Securities and Exchange Commission ("SEC") and the American
Stock Exchange. The SEC requires executive officers, directors and greater than
ten-percent shareholders to furnish to us copies of all Section 16(a) forms they
file.
Based solely on our review of these reports and of certifications
furnished to us, we believe that during the fiscal year ended December 31, 1999
all executive officers, directors and greater than ten-percent beneficial owners
complied with all applicable Section 16(a) filing requirements, except for Mr.
Vaccaro who filed his initial Form 3 reporting his initial ownership in CVB
Financial late and Mr. Basirico who filed one Form 4 late relating to the
exercise of stock options in September 1999.
THE BOARD RECOMMENDS A VOTE "FOR" ALL SEVEN NOMINEES FOR DIRECTOR.
PROPOSAL 2
APPROVE CVB FINANCIAL CORP. 2000 STOCK OPTION PLAN
On March 15, 2000, the CVB Financial Board of Directors adopted, subject
to your approval, the CVB Financial Corp. 2000 Stock Option Plan as part of a
continuing program to attract, retain and motivate its employees, directors and
consultants. The Board of Directors believes that the 2000 Option Plan will
provide a continued incentive for employees, directors and consultants to
contribute to the continued profitability and success of CVB Financial and its
subsidiaries and will increase these individuals financial stake in CVB
Financial. In addition, the 2000 Option Plan will underscore eligible
participants' common interest with our shareholders in increasing the value of
CVB Financial over the long term. We have attached a copy of the 2000 Option
Plan to this Proxy Statement as Appendix A.
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<PAGE> 21
WHO IS ELIGIBLE TO PARTICIPATE IN THE 2000 OPTION PLAN?
The 2000 Option Plan authorizes the granting of stock options to
employees, non-employee directors, consultants and other independent contractors
of CVB Financial and its subsidiary companies, including Citizens Business Bank.
In the event CVB Financial acquires another company by merger or otherwise, the
Board of Directors or Stock Option Committee may authorize the issuance of
options to individuals performing services for the acquired entity in
substitution of options previously granted to those individuals in connection
with their performance and service for the acquired entity.
HOW MANY SHARES MAY BE GRANTED TO INDIVIDUAL EMPLOYEES AND HOW MANY SHARES WILL
BE AVAILABLE IN TOTAL UNDER THE 2000 OPTION PLAN?
The total number of shares of CVB Financial Corp. common stock for which
options may be granted under the 2000 Option Plan is two million (2,000,000),
and the maximum number of stock options that CVB Financial may grant to any
individual in any calendar year is one hundred thousand (100,000), in each case
subject to adjustment as described below. The shares available for issuance
under the 2000 Option Plan may be authorized but unissued shares of common stock
or shares of common stock reacquired by the Company. If any shares subject to
option expire or are forfeited or canceled, those shares will be added back to
the total number of shares available for issuance under the 2000 Option Plan.
WHO WILL ADMINISTER THE 2000 OPTION PLAN?
The 2000 Option Plan will be administered by the Board of Directors or
Stock Option Committee of the Board of Directors, which will determine who will
receive options, the date of grants of options and the terms and provisions of
each option grant (which need not be identical).
WHAT WILL THE OPTION EXERCISE PRICE BE?
Each option will be at a purchase price not less than 100% of the fair
market value of CVB Financial Common Stock at the time the option is granted.
Therefore, the amount of compensation with respect to options is determined by
an increase in value of CVB Financial common stock after the date of grant of
the option.
HOW CAN OPTIONS BE EXERCISED?
Options may be exercised by cash or such other form of consideration as
the Company shall determine, such as the surrender of outstanding shares of
common stock or withholding shares that would otherwise be issued upon exercise
of the option.
Each option agreement will set forth when and under what terms an Option
may be exercised. The Board of Directors or Stock Option Committee administering
the 2000 Option Plan may accelerate the exercisability of all or any portion of
an option at any time.
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<PAGE> 22
CAN THE OPTIONS BE TRANSFERRED?
An optionee cannot transfer an option otherwise than by will or by the
laws of descent and distribution and all stock options shall be exercisable,
during the optionee's lifetime, only by the optionee, except that nonstatutory
options can be transferred under certain circumstances to trusts established by
an optionee for estate planning purposes.
WHEN DO THE OPTIONS TERMINATE?
Except to the extent the terms of an option require its prior
termination, each option shall terminate on the earliest to occur of (i) ten
years from the date on which the option is granted (in the case of incentive
stock options) or five (5) years in the case of an incentive stock option
granted to a holder of 10% or more of the CVB Financial common stock; or (ii) no
less than ninety (90) days and no more than 60 months, unless such severance is
a result of death, disability or retirement, in which case the option shall
terminate one year from the date of such death, disability or retirement.
If CVB Financial terminates someone for cause, such option shall
immediately terminate unless the Board of Directors provides that the option may
be exercisable after the date of termination, but in no case may the option be
exercised for more than 30 days after such termination.
If someone dies or becomes disabled, while holding a stock option, the
stock option may be exercised by the legal representative of the optionee, or
the optionee himself, as the case may be for a period of 12 months from the date
of death, but no later than the expiration of the option.
Any option held by an optionee who retires in accordance with the terms
of the 2000 Option Plan, may exercise the option for a period of 12 months (or
such other period as the Board of Directors shall specify) from the date of such
retirement, but not later than the expiration of the stated term of the option,
if earlier.
If an optionee's employment terminates for any reason other than death,
disability, retirement or cause, the optionee may exercise the option, to the
extent it was exercisable at the time of termination, for 90 days, or such other
period not to exceed 60 months, as the Board of Directors or Stock Option
Committee shall determine, from the date of termination, but not later than the
stated term of the option.
WHAT HAPPENS IF CVB FINANCIAL DECLARES A STOCK SPLIT OR STOCK DIVIDEND?
In the event of a stock split, stock dividend, recapitalization,
reorganization, merger, consolidation, split-up, combination, exchange, or
similar change affecting common stock, CVB Financial will make an appropriate
adjustment in the number and kind of shares covered by each outstanding option,
the aggregate number and/or kind of shares for which options may be granted
under the 2000 Option Plan, and the exercise price per share in respect of each
outstanding option.
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<PAGE> 23
WHAT HAPPENS IF CVB FINANCIAL DECIDES TO ENTER INTO A MERGER OR DECIDES TO
DISSOLVE?
In the event of a dissolution or liquidation of CVB Financial or a
merger with CVB Financial, or a sale of all or substantially all of the assets
of CVB Financial, the Board will notify each optionee and each optionee will
have the right to exercise all of his or her options, regardless of their
vesting schedule. Upon the occurrence of the merger, dissolution or sale, the
2000 Option Plan and any option or portion thereof not exercised will terminate
unless the 2000 Option Plan and the options thereunder are assumed by the
surviving corporation or new options in the successor corporation are
substituted for the CVB Financial options.
WHAT ARE THE FEDERAL INCOME TAX CONSEQUENCES WITH RESPECT TO STOCK OPTIONS.
Incentive Stock Options.
An optionee will not realize taxable income and CVB Financial will not
receive any deduction at the time of a grant or exercise of incentive stock
options. If shares acquired by optionees upon the exercise of incentive stock
options are not disposed of within two years from the date of grant, nor within
one year from the date of exercise, any gain or loss realized upon the
disposition of the shares will be treated as long-term capital gain or loss. For
purposes of the alternative minimum tax only, the excess of the fair market
value of the shares at the time of exercise of incentive options over the option
price will be treated as additional income unless such shares are disposed of in
the year of exercise.
If the shares received upon exercise of an incentive stock option are
disposed of prior to the end of the applicable holding periods, the difference
between (a) the lesser of the fair market value of the shares on the date of
exercise on the price received upon disposition of the shares and (b) the
exercise price will be taxable to the optionee as ordinary income in the year in
which such disposition occurs, and CVB Financial will be entitled to a deduction
in the amount of such ordinary income recognized by the optionee. Any further
gain or loss upon disposition will be treated as short-term or long-term capital
gain or loss depending on the holding period of the shares.
If incentive options are exercised with CVB Financial common stock
previously owned by such optionee, such exercise will not be considered a
taxable disposition of the previously owned stock unless such stock was itself
received on exercise of incentive options and the holding periods described
above for the exchanged stock have not been satisfied.
To the extent that the aggregate option price of an optionee's inventive
options which become exercisable in any year exceeds $100,000, such options will
be treated as non-qualified options. If incentive options are exercised more
than three months after the optionee's employment with CVB Financial has ended,
the incentive options will be treated as non-qualified options.
Non-qualified Options.
An optionee will not recognize taxable income and CVB Financial will not
receive any deduction at the time of a grant of non-qualified options. Upon the
exercise of non-
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<PAGE> 24
qualified options, the excess of the fair market value on the date of exercise
of the shares received over the exercise price for such shares will be taxable
to the optionee as ordinary income, and CVB Financial may be entitled to a
deduction, subject to applicable withholding and regulatory requirements, at
that time for the amount of such ordinary income recognized by the optionee. The
subsequent sale of such shares by the optionee will be treated as short-term or
long-term capital gain or loss, as the case may be, in an amount equal to the
difference between the amount realized on such sale and the fair market value of
the shares at the time of exercise.
If options are exercised with CVB Financial's Common Stock previously
owned by the optionee, such exercise will not be considered a taxable
disposition of the previously owned stock, unless such stock was itself received
on an exercise of incentive options and the relevant holding periods for the
exchanged stock have not been satisfied, and no gain or loss will be recognized
with respect to such stock upon such exercise. If additional shares are received
by the optionee, the excess of the fair market value of all of the shares
received over the sum of the fair market value of all of the shares surrendered
and any cash payment made by the optionee upon exercise will be taxable as
ordinary income to the optionee and may be deductible by us.
WHEN CAN THE BOARD OF DIRECTORS TERMINATE OR AMEND THE 2000 OPTION PLAN?
The Board of Directors may, at any time, amend or discontinue the 2000
Option Plan, and the Board of Directors or Stock Option Committee administering
the 2000 Option Plan may amend or cancel any option for any lawful purpose, but
no action can adversely affect the rights under any outstanding option without
obtaining the optionee's consent.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" APPROVAL OF THE
2000 STOCK OPTION PLAN.
PROPOSAL 3
RATIFICATION OF APPOINTMENT OF INDEPENDENT PUBLIC ACCOUNTANTS
We have appointed Deloitte & Touche as independent public accountants
for the year ending December 31, 2000. The Audit Committee recommended the
appointment of Deloitte & Touche to the Board. Deloitte & Touche, who performed
our audit services in 1999, including an examination of the consolidated
financial statements and services related to filings with the Securities and
Exchange Commission, has served as our accountants since 1986. Deloitte & Touche
performed all of its services in 1999 at customary rates and terms.
Representatives of Deloitte & Touche will be present at the meeting, will be
available to respond to your appropriate questions and will be able to make such
statements as they desire.
If you do not ratify the selection of independent accountants, the Audit
Committee and the Board will reconsider the appointment. However, even if you
ratify the selection, the Board may still appoint new independent accountants at
any time during the year if it believes that such a change would be in the best
interests of CVB Financial and our shareholders.
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THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE
RATIFICATION OF
THE SELECTION OF
DELOITTE & TOUCHE AS THE COMPANY'S INDEPENDENT
ACCOUNTANTS FOR 2000.
ANNUAL REPORT
Together with this Proxy Statement, CVB Financial has distributed to
each of its shareholders an annual report for the year ended December 31, 1999.
CVB Financial's annual report contains consolidated financial statements of the
Company and its subsidiaries and the report thereon of Deloitte & Touche, the
Company's independent public accountants.
UPON WRITTEN REQUEST OF ANY PERSON ENTITLED TO VOTE AT THE MEETING,
ADDRESSED TO DONNA MARCHESI, SECRETARY OF THE COMPANY, AT 701 NORTH HAVEN
AVENUE, SUITE 350, ONTARIO, CALIFORNIA 91764, WE WILL PROVIDE, WITHOUT CHARGE, A
COPY OF OUR ANNUAL REPORT ON FORM 10-K FOR 1999, INCLUDING THE FINANCIAL
STATEMENTS AND THE SCHEDULES FILED WITH THE SECURITIES AND EXCHANGE COMMISSION
PURSUANT TO THE SECURITIES EXCHANGE ACT OF 1934.
PROPOSALS OF SHAREHOLDERS
If you wish to submit a proposal for consideration at our 2001 Annual
Meeting of Shareholders, you may do so by following the procedures prescribed in
the Securities Exchange Act of 1934. To be eligible for inclusion in the
Company's proxy statement and proxy materials, our Corporate Secretary must
receive your proposals no later than December 21, 2000.
In addition, in the event a shareholder proposal is not submitted to the
Company prior to February 24, 2001, the proxy to be solicited by the Board of
Directors for the 2001 Annual Meeting of Shareholders will confer authority on
the holders of the proxy to vote the shares in accordance with their best
judgment and discretion, if the proposal is presented at the 2001 Annual Meeting
of Shareholders, without any discussion of the proposal in the proxy statement
for such meeting.
Dated: April 10, 2000 CVB FINANCIAL CORP.
By /S/ D. LINN WILEY
----------------------------------
D. Linn Wiley
President and Chief Executive Officer
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APPENDIX A
CVB FINANCIAL CORP. 2000 STOCK OPTION PLAN
As Adopted by the Board of Directors on March 15, 2000
Section 1. Purpose; Definitions.
The name of the plan is the CVB Financial Corp. 2000 Stock Option Plan
(the "Plan"). The purpose of the Plan is to encourage and enable employees
(including officers and Directors) of CVB Financial Corp., a California
corporation (the "Company") and its Subsidiaries, non-employee members of the
Board of Directors of the Company, and those consultants and other independent
contractors who provide services to the Company and its Subsidiaries and upon
whose judgment, initiative and efforts the Company and its Subsidiaries depend
for the successful conduct of their business to acquire proprietary interests in
the Company. It is anticipated that providing such persons with a direct stake
in the Company's welfare will assure a closer identification of their interests
with those of the Company, thereby stimulating their efforts on behalf of the
Company and its Subsidiaries and strengthening their desire to remain with the
Company and its Subsidiaries.
The following terms shall be defined as set forth below:
(a) "Act" means the Securities Act of 1933, as amended.
(b) "Administrator" means the Board or the Committee.
(c) "Award" or "Awards," except where referring to a particular category
of grant under the Plan, shall include Incentive Stock Options and Nonstatutory
Stock Options.
(d) "Board" means the Board of Directors of the Company.
(e) "Cause," as such term relates to the termination of any person's
status as an employee or other service provider of the Company, means the
occurrence of one or more of the following: (i) such person is convicted of,
pleads guilty to, or confesses to any felony or any act of fraud,
misappropriation or embezzlement which has an immediate and materially adverse
effect on the Company or any Subsidiary, as determined by the Board in good
faith in its sole discretion, (ii) such person engages in a fraudulent act to
the material damage or prejudice of the Company or any Subsidiary or in conduct
or activities materially damaging to the property, business or reputation of the
Company or any Subsidiary, all as determined by the Board in good faith in its
sole discretion, (iii) any material act or omission by such person involving
malfeasance or negligence in the performance of such person's duties to the
Company or any Subsidiary to the material detriment of the Company or any
Subsidiary, as determined by the Board in good faith in its sole discretion,
which has not been corrected by such person to the
<PAGE> 27
satisfaction of the Board within 30 days after written notice from the Company
of any such act or omission, (iv) failure by such person to comply in any
material respect with the terms of his employment agreement, if any, or any
written policies or directives of the Board as determined by the Board in good
faith in its sole discretion, which has not been corrected by such person to the
satisfaction of the Board within 30 days after written notice from the Company
of such failure, or (v) material breach by such person of any other agreement
with the Company, as determined by the Board in good faith in its sole
discretion.
(f) "Code" means the Internal Revenue Code of 1986, as amended, and any
successor tax laws, and related rules, regulations and interpretations.
(g) "Committee" means a committee of two or more Independent Directors
appointed by the Board to administer the Plan.
(h) "Director" means a member of the Board.
(i) "Disability" means such individual's total and permanent disability
within the meaning of Section 22(e)(3) of the Code. However, in no event will a
participant be considered to be disabled for purposes of this Plan if the
individual's incapacity is a result of an intentionally self-inflicted injury
(while sane or insane), alcohol or drug abuse, or a criminal act for which the
individual is convicted or to which the individual pleads guilty or nolo
contendre.
(j) "Fair Market Value" of the Stock on any given date under the Plan
shall be determined as follows:
(i) If the Stock is at the time listed or admitted to trading on
any national stock exchange, then the fair market value shall be the
closing selling price per share of the Stock on the day of determination
on the stock exchange determined by the Administrator to be the primary
market for the Common Stock, as such price is officially quoted in the
composite tape transactions on such exchange. If there is no reported
sale of the Stock on such exchange on the day of determination, then the
fair market value shall be the closing price on the exchange on the last
preceding date for which such quotation exists.
(ii) If the Stock is not at the time listed or admitted to
trading on any national exchange but is traded on the NASDAQ National
Market or Small Cap Market System, the fair market value shall be the
closing selling price per share of the Stock on the day of
determination, as such price is reported by the National Association of
Securities Dealers, Inc. through the NASDAQ National Market or SmallCap
System, as the case may be, or through any successor system. If there is
no reported closing selling price for the Stock on the day of of
determination, then the fair market value shall be the closing selling
price on the last preceding date for which such quotation exists.
(iii) If the Stock is regularly quoted by a recognized
securities dealer, but selling prices are not reported (and the Stock is
otherwise not listed or admitted as described in (i) and (ii) above),
the fair market value shall be the mean between the high
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and low bid prices for the Common Stock on the day of determination, or,
if there is no reported mean between the high and low bid prices on the
day of determination, on such last market trading day prior to the day
of determination on which such mean exists; or
(iv) If the Stock is at the time neither listed nor admitted to
trading on any stock exchange nor traded in the over-the-counter market
nor otherwise regularly quoted by recognized securities dealer, then the
fair market value shall be determined by the Administrator after taking
into account such factors as the Administrator shall deem appropriate.
(k) "Incentive Stock Option" means any Stock Option designated and
qualified as an "incentive stock option" as defined in Section 422 of the Code.
(l) "Independent Director" means persons who qualify as "nonemployee
directors" as such term is defined in Securities and Exchange Commission Rule
16b-3 under the 1934 Act ("Nonemployee Directors") and who qualify as "outside
directors" within the meaning of Section 162(m)(4)(C)(i) of the Code and
Treasury Regulations 1.162-27(c)(3) ("Outside Director"). The Board shall have
the authority to appoint and remove members of the Committee, provided, however,
that any attempted appointment to the Committee of a person who does not qualify
as an Outside Director and Nonemployee Director shall be null and void. Any
Committee member who loses the status of an Outside Director and Nonemployee
Director shall automatically and without further action cease to be a member of
the Committee as soon as such status is lost.
(m) "Nonstatutory Stock Option" means any Stock Option that is not an
Incentive Stock Option.
(m) "Option" or "Stock Option" means any option to purchase shares of
Stock granted pursuant to Section 5.
(n) "Retirement" means an employee's termination of employment with the
Company and its Subsidiaries after attainment of age 65 or attainment of age 55
and completion of 10 years of employment.
(o) "Stock" means the Common Stock, no par value, of the Company,
subject to adjustments pursuant to Section 3.
(p) "Subsidiary" means any corporation or other entity (other than the
Company) in any unbroken chain of corporations or other entities, beginning with
the Company if each of the corporations or entities (other than the last
corporation or entity in the unbroken chain) owns stock or other interests
possessing 50% or more of the economic interest or the total combined voting
power of all classes of stock or other interests in one of the other
corporations or entities in the chain.
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Section 2. Administration of Plan; Authority to Select Participants and
Determine Awards
(a) Powers of Administrator. The Administrator shall have the power and
authority to grant Awards consistent with the terms of the Plan, including the
power and authority:
(i) to select those employees (including officers and Directors)
of the Company and its Subsidiaries, non-employee Directors, and
consultants and other independent contractors in service to the Company
and its Subsidiaries to whom Awards may from time to time be granted;
(ii) to determine the time or times of grant, and the extent, if
any, of Incentive Stock Options and Nonstatutory Stock Options or any
combination of the foregoing, granted to any one or more participants;
(iii) to determine the number of shares of Stock to be covered
by any Award;
(iv) to determine and modify from time to time the terms and
conditions, including restrictions, not inconsistent with the terms of
the Plan, of any Award, which terms and conditions may differ among
individual Awards and participants, and to approve the form of written
instruments evidencing the Awards;
(v) to accelerate at any time the exercisability or vesting of
all or any portion of any Award;
(vi) subject to the provisions of Section 5(a)(ii), to extend at
any time the period in which Stock Options may be exercised;
(vii) to determine at any time whether, to what extent, and
under what circumstances Stock and other amounts payable with respect to
an Award shall be deferred either automatically or at the election of
the participant and whether and to what extent the Company shall pay or
credit amounts constituting interest (at rates determined by the
Administrator) or dividends or deemed dividends on such deferrals; and
(viii) at any time to adopt, alter and repeal such rules,
guidelines and practices for administration of the Plan and for its own
acts and proceedings as it shall deem advisable; to interpret the terms
and provisions of the Plan and any Award (including related written
instruments); to make all determinations it deems advisable for the
administration of the Plan; to decide all disputes arising in connection
with the Plan; and otherwise to supervise the administration of the
Plan.
All decisions and interpretations of the Administrator shall be binding
on all persons, including the Company and Plan participants.
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Section 3. Stock Issuable Under the Plan; Mergers; Substitution
(a) Stock Issuable. The maximum number of shares of Stock reserved and
available for the grant of Awards under the Plan shall be the sum of two million
(2,000,000) shares, subject to adjustment as described in Section 3(b). For
purposes of this limitation, the shares of Stock underlying any Awards which
expire or which are forfeited, canceled, reacquired by the Company, satisfied
without the issuance of Stock or otherwise terminated (other than by exercise)
shall be added back to the shares of Stock available for issuance under the
Plan. Subject to such overall limitation, shares of Stock may be issued up to
such maximum number pursuant to any type or types of Award; provided, however,
that Stock Options with respect to no more than one hundred thousand (100,000)
shares of Stock may be granted to any one individual participant during any one
calendar year period, subject to adjustment as described in Section 3(b) below.
The shares available for issuance under the Plan may be authorized but unissued
shares of Stock or shares of Stock reacquired by the Company.
(b) Changes in capitalization. Subject to any required action by the
shareholders of the Company, the number of shares of Common Stock covered by
each outstanding Stock Option, and the number of shares of Common Stock which
have been authorized for issuance under the Plan (including the maximum number
of shares of Common Stock which can be subject to any Stock Option for any
particular person) but as to which no Stock Options have yet been granted or
which have been returned to the Plan upon cancellation or expiration of a Stock
Option shall be proportionately adjusted for any increase or decrease in the
number of issued shares of Common Stock resulting from a stock split, reverse
stock split, stock dividend, combination or reclassification of the Common
Stock, merger, consolidation, reorganization, any partial or complete
liquidation, or any other increase or decrease in the number of issued shares of
Common Stock effected without receipt of consideration by the Company. Such
adjustment shall be made by the Board of Directors, whose determination in that
respect shall be final, binding and conclusive. No fractional shares of Stock
shall be issued under the Plan resulting from any such adjustment, but the Board
of Directors in its discretion may make a cash payment in lieu of fractional
shares.
(c) Mergers, etc. Not less than fifteen (15) days, or such shorter
period of time as the Administrator shall determine, prior to (i) the
dissolution or liquidation of the Company, (ii) a reorganization, merger, or
consolidation of the Company with one or more corporations as a result of which
the Company will not be the surviving or resulting corporation, or a sale of all
or substantially all the assets of the Company to another person, or (iii) a
reverse merger in which the Company is the surviving corporation but (a) the
shares of the Company's stock outstanding immediately preceding the merger are
converted by virtue of the merger into other property or (b) the voting
securities of the Company outstanding immediately prior to such event represent
less than fifty percent (50%) of the total voting power represented by the
voting securities of the Company surviving such event (a "Terminating Event")
(other than a merger or consolidation with a wholly-owned subsidiary, a
reincorporation of the Company in a different jurisdiction, or other transaction
in which there is no substantial change in the shareholders of the Company or
their relative stock holdings and the Stock Options granted under this Plan are
assumed, converted or replaced by the successor corporation, which assumption
will be binding on all optionees), the Administrator shall notify each optionee
of the pendency of the Terminating
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Event. Upon delivery of said notice, any option granted prior to the Terminating
Event shall be, notwithstanding the provisions of paragraph 2 hereof,
exercisable in full and not only as to those shares with respect to which
installments, if any, have then accrued, subject, however, to earlier expiration
or termination as provided elsewhere in the Plan. Upon the consummation of the
Terminating Event, the Plan and any option or portion thereof not exercised
shall terminate unless provision is made in connection with the Terminating
Event for assumption of the Plan and/or the options theretofore granted, or
substitution for such options of new options covering stock of a successor
employer corporation, or a parent or subsidiary corporation thereof, solely at
the option of such successor corporation or parent or subsidiary corporation,
with appropriate adjustments as to number and kind of shares and prices.
(d) Substitute Awards. The Administrator may grant Awards under the Plan
in substitution for stock and stock based awards held by employees of another
corporation who become employees of the Company or a Subsidiary as the result of
a merger or consolidation of the employing corporation with the Company or a
Subsidiary or the acquisition by the Company or a Subsidiary of property or
stock of the employing corporation. The Administrator may direct that the
substitute awards be granted on such terms and conditions as the Administrator
considers appropriate in the circumstances, including the grant of Incentive
Stock Options.
Section 4. Eligibility
Participants in the Plan shall be such full-time or part-time employees
(including officers and Directors) of the Company and its Subsidiaries,
non-employee Directors, and consultants and other independent contractors in
service to the Company and its Subsidiaries as the Administrator in its sole
discretion shall select from time to time.
Section 5. Stock Options
Any Stock Option granted under the Plan shall be in such form as the
Administrator may from time to time approve. Stock Options granted under the
Plan may be either Incentive Stock Options or Nonstatutory Stock Options.
Incentive Stock Options may be granted only to employees of the Company or any
Subsidiary that is a "subsidiary corporation" within the meaning of Section
424(f) of the Code. To the extent that any Option does not qualify as an
Incentive Stock Option, it shall be a Nonstatutory Stock Option.
No Incentive Stock Option shall be granted under the Plan after ten
years from the date of adoption of the Plan by the Board of Directors.
(a) Terms and Conditions of Stock Options. The Administrator in its
discretion may grant Stock Options subject to the following terms and conditions
and such additional terms and conditions, not inconsistent with the terms of the
Plan, as the Administrator shall deem desirable:
(i) Exercise Price. The exercise price per share for the Stock
covered by a Stock Option granted pursuant to this Section 5(a) shall be
determined by the Administrator at the time of grant, but shall not be
less than 100% of the Fair Market Value of a share of Stock on the date
of grant, except as provided in Section 3(d). If an
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employee owns or is deemed to own (by reason of the attribution rules of
Section 424(d) of the Code) more than 10% of the combined voting power
of all classes of stock of the Company or of any "parent or subsidiary
corporation" of the Company (within the meaning of Section 424(e) or
424(f) of the Code, as the case may be) and an Incentive Stock Option is
granted to such employee, the exercise price per share for the Stock
covered by such Incentive Stock Option shall be not less than 110% of
the Fair Market Value of a share of Stock on the grant date.
(ii) Option Term. The term of each Stock Option shall be fixed
by the Administrator, but no Option shall be exercisable more than ten
years after the date the Option is granted. If an employee owns or is
deemed to own (by reason of the attribution rules of Section 424(d) of
the Code) more than 10% of the combined voting power of all classes of
stock of the Company or of any "parent or subsidiary corporation" of the
Company (within the meaning of Section 424(e) or 424(f) of the Code, as
the case may be) and an Incentive Stock Option is granted to such
employee, the term of such Option shall expire no more than five years
after the date of grant.
(iii) Exercisability; Rights of a Shareholder. Stock Options
shall become exercisable at such time or times, whether or not in
installments, as shall be determined by the Administrator at the time of
grant. The Administrator may at any time accelerate the exercisability
of all or any portion of any Stock Option. An optionee shall have the
rights of a shareholder only as to shares acquired upon the exercise of
a Stock Option and not as to unexercised Stock Options.
(iv) Method of Exercise. Stock Options may be exercised in whole
or in part, by giving written notice of exercise to the Company
specifying the number of shares to be purchased. Payment of the purchase
price shall be made in full concurrently with such exercise by any one
of the following methods: (A) in cash; (B) if, in the sole discretion of
the Administrator, and if the Company is not then prohibited from
purchasing or acquiring shares of Stock, with shares of Stock that have
been held by the optionee for the requisite period necessary to avoid a
charge to the Company's earnings for financial reporting purposes,
delivered in lieu of cash and valued at their Fair Market Value on the
date of exercise; (C) through a "same day sale" commitment from the
optionee and a broker-dealer that is a member of the National
Association of Securities Dealers, Inc. (the "NASD Dealer") whereby the
optionee irrevocably elects to exercise the Option and to sell a portion
of the shares so purchased to pay for the exercise price, and whereby
the NASD Dealer irrevocably commits upon receipt of such shares to
forward the exercise price directly to the Company;; or (D) any
combination of the foregoing. The delivery of certificates representing
the shares of Stock to be purchased pursuant to the exercise of a Stock
Option will be contingent upon receipt from the optionee (or a purchaser
acting in his stead in accordance with the provisions of the Stock
Option) by the Company of the full purchase price for such shares and
the fulfillment of any other requirements contained in the Stock Option
or applicable provisions of laws.
(v) Termination by Reason of Death. Any Stock Option held by an
optionee whose employment by (or other business relationship with) the
Company and its
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<PAGE> 33
Subsidiaries is terminated by reason of the optionee's death may
thereafter be exercised, to the extent it was exercisable by the
optionee on the date of the optionee's death, by the legal
representative of the optionee's estate or by any other person who
acquires the right to exercise the option by reason of such death under
the optionee's will or the laws of intestate succession, for a period of
12 months (or such other period as the Administrator shall specify in
the Stock Option) from the date of death, but not later than the
expiration of the stated term of the Option, if earlier.
(vi) Termination by Reason of Disability. Any Stock Option held
by an optionee whose employment by (or other business relationship with)
the Company and its Subsidiaries is terminated by reason of Disability
may thereafter be exercised, to the extent it was exercisable on the
date of such termination, for a period of 12 months (or such other
period as the Administrator shall specify in the Stock Option) from the
date of such termination of employment (or business relationship), but
not later than the expiration of the stated term of the Option, if
earlier. The Administrator shall have sole authority and discretion to
determine whether a participant's employment (or business relationship)
has been terminated by reason of Disability. The Administrator may
specify in any Stock Option that the death of an optionee during the
period provided in this Section 5(a)(vi) for the exercise of the Option
shall extend such period for a period ending not later than 12 months
following the date of the optionee's death, subject to termination on
the expiration of the stated term of the Option, if earlier.
(vii) Termination by Reason of Retirement. Any Stock Option held
by an optionee whose employment by the Company and its Subsidiaries is
terminated by reason of Retirement may thereafter be exercised, to the
extent it was exercisable on the date of such termination, for a period
of 12 months (or such other period as the Administrator shall specify)
from the date of such termination of employment, but not later than the
expiration of the stated term of the Option, if earlier. The
Administrator may specify in any Stock Option that the death of an
optionee during the period provided in this Section 5(a)(vii) for the
exercise of the Option shall extend such period for a period ending not
later than 12 months following the date of the optionee's death, subject
to termination on the expiration of the stated term of the Option, if
earlier.
(viii) Termination for Cause. If any optionee's employment by
(or business relationship with) the Company and its Subsidiaries is
terminated for Cause, any Stock Option held by such optionee, including
any Stock Option that is exercisable at the time of such termination,
shall immediately terminate and be of no further force and effect;
provided, however, that the Administrator may, in its sole discretion,
provide in any Stock Option that such Stock Option can be exercised, to
the extent it was exercisable on the date of such termination, for a
period of up to 30 days from the date of termination of employment (or
business relationship), but not later than the expiration of the stated
term of the Option, if earlier.
(ix) Other Termination. Unless otherwise determined by the
Administrator, if an optionee's employment by (or business relationship
with) the Company and its Subsidiaries terminates for any reason other
than death, Disability, Retirement, or for
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<PAGE> 34
Cause, any Stock Option held by such optionee may thereafter be
exercised, to the extent it was exercisable on the date of such
termination, for 90 days (or such other period not to exceed 60 months
as the Administrator shall specify) from the date of termination of
employment (or business relationship), but not later than the expiration
of the stated term of the Option, if earlier.
(x) Annual Limit on Incentive Stock Options. Section 422 of the
Code requires for "incentive stock option" treatment that the aggregate
Fair Market Value (determined as of the time of grant) of the shares of
Stock with respect to which Incentive Stock Options granted under this
Plan and any other plan of the Company or its parent and subsidiary
corporations become exercisable for the first time by an optionee during
any calendar year shall not exceed $100,000. To the extent that any
Stock Option exceeds this limit, it shall constitute a Nonstatutory
Stock Option. In the event the $100,000 limit is exceeded, the optionee
may designate in writing to the Administrator whether this optionee is
exercising the Incentive Stock Option portion or the Nonstatutory Stock
Option portion. In the absence of such written designation, the
Incentive Stock Option portion shall be deemed exercised first to the
extent thereof.
(b) Non-Transferability of Options. No Stock Option shall be
transferable by the optionee otherwise than by will or by the laws of descent
and distribution and all Stock Options shall be exercisable, during the
optionee's lifetime, only by the optionee, provided, however, Non-Statutory
Stock Options may be transferred to any inter vivos or testamentary trust, which
shall agree in writing to be bound by the terms of this Plan, established for
estate planning purposes for the sole and exclusive benefit of such owner, one
(1) or more members of such owner's family that are related to such owner by
blood (which members shall include, without limitation, the spouse, adopted
children, and stepchildren of such owner) and/or any other lineal descendants of
such owners and in which such owner is a trustee thereof, or such other trust
established for estate planning purposes as the Board of Directors or Committee
shall approve in writing and which complies with applicable law.
(c) Form of Settlement. Shares of Stock issued upon exercise of a Stock
Option shall be free of all restrictions under the Plan, except as otherwise
provided in the Plan.
Section 6. Tax Withholding
(a) Payment By Participant. Each participant shall, no later than the
date as of which the value of an Award or of any Stock or other amounts received
thereunder first becomes includable in the gross income of the participant for
Federal income tax purposes, pay to the Company, or make arrangements
satisfactory to the Administrator regarding payment of, any Federal, state, or
local taxes of any kind required by law to be withheld with respect to such
income. The Company and its Subsidiaries shall, to the extent permitted by law,
have the right to deduct any such taxes from any payment of any kind otherwise
due to the participant.
(b) Payment in Stock. Subject to approval by the Administrator, a
participant may elect to have such tax withholding obligation satisfied, in
whole or in part, by (i) authorizing the Company to withhold from shares of
Stock to be issued pursuant to any Award a number of
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<PAGE> 35
shares with an aggregate Fair Market Value (as of the date the withholding is
effected) that would satisfy the withholding amount due, or (ii) transferring to
the Company shares of Stock owned by the participant with an aggregate Fair
Market Value (as of the date the withholding is effected) that would satisfy the
withholding amount due.
Section 7. Transfer, Leave of Absence, Etc.
For purposes of the Plan, the following events shall not be deemed a
termination of employment:
(a) a transfer to the employment of the Company from a Subsidiary or
from the Company to a Subsidiary, or from one Subsidiary to another; or
(b) an approved leave of absence for military service or sickness, or
for any other purpose approved by the Company, if the employee's right to
re-employment is guaranteed either by a statute or by contract or under the
policy pursuant to which the leave of absence was granted or if the
Administrator otherwise so provides in writing.
Section 8. Amendments and Termination
The Board may, at any time, amend or discontinue the Plan and the
Administrator may, at any time, amend or cancel any outstanding Award (or
provide substitute Awards at the same or reduced exercise or purchase price or
with no exercise or purchase price in a manner not inconsistent with the terms
of the Plan, but such price, if any, must satisfy the requirements which would
apply to the substitute or amended Award if it were then initially granted under
this Plan) for the purpose of satisfying changes in law or for any other lawful
purpose, but no such action shall adversely affect rights under any outstanding
Award without the holder's consent. If and to the extent determined by the
Administrator to be required to ensure that Incentive Stock Options granted
under the Plan are qualified under Section 422 of the Code, Plan amendments
shall be subject to approval by the Company's shareholders entitled to vote at a
meeting of shareholders. Unless sooner terminated, the Plan shall terminate ten
years from the date The Board of Directors approves The Plan.
Section 9. Status of Plan
With respect to the portion of any Award which has not been exercised
and any payments in cash, Stock or other consideration not received by a
participant, a participant shall have no rights greater than those of a general
creditor of the Company unless the Administrator shall otherwise expressly
determine in connection with any Award or Awards. In its sole discretion, the
Administrator may authorize the creation of trusts or other arrangements to meet
the Company's obligations to deliver Stock or make payments with respect to
Awards hereunder, provided that the existence of such trusts or other
arrangements is consistent with the foregoing sentence.
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<PAGE> 36
Section 10. General Provisions
(a) No Distribution; Compliance With Legal Requirements. The
Administrator may require each person acquiring Stock pursuant to an Award to
represent to and agree with the Company in writing that such person is acquiring
the shares without a view to distribution thereof. No shares of Stock shall be
issued pursuant to an Award until all applicable securities law and other legal
and stock exchange or similar requirements have been satisfied. The
Administrator may require the placing of such stop-orders and restrictive
legends on certificates for Stock and Awards as it considers appropriate.
(b) Delivery Of Stock Certificates. Delivery of stock certificates to
participants under this Plan shall be deemed effected for all purposes when the
Company or a stock transfer agent of the Company shall have mailed such
certificates in the United States mail, addressed to the participant, at the
participant's last known address on file with the Company.
(c) Other Compensation Arrangements; No Employment Rights. Nothing
contained in this Plan shall prevent the Board from adopting other or additional
compensation arrangements, including trusts, and such arrangements may be either
generally applicable or applicable only in specific cases. The adoption of this
Plan and the grant of Awards do not confer upon any employee any right to
continued employment with the Company or any Subsidiary.
(d) Performance-Based Compensation. For purposes of Section 162(m)(4)(c)
of the Code and Treasury Regulation Section 1.162-27(e)(2)(vi), the amount of
compensation an optionee may receive under a Stock Option is based solely on an
increase in the value of the Stock after the date of the grant or award of a
Stock Option.
(e) Incorporation by Reference. Every written instrument evidencing an
Award shall incorporate the terms of this Plan by reference as governing the
Award.
Section 11. Effective Date of Plan
This Plan shall become effective upon the later to occur of (i) approval
by the Company's Board of Directors and (ii) approval by the Company's
shareholders.
Section 12. Governing Law
This Plan shall be governed by California law except to the extent such
law is preempted by federal law.
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<PAGE> 37
CVB FINANCIAL CORP.
REVOCABLE PROXY FOR THE ANNUAL MEETING OF SHAREHOLDERS
TO BE HELD MAY 17, 2000
THE BOARD OF DIRECTORS IS SOLICITING THIS PROXY
I/we hereby nominate, constitute and appoint John A. Borba, John J. LoPorto
and James C. Seley, and each of them, their attorneys, agents and proxies, with
full powers of substitution to each, to attend and act as proxy or proxies at
the 2000 Annual Meeting of Shareholders of CVB FINANCIAL CORP. which will be
held at the Double Tree Hotel, 222 North Vineyard, Ontario, California 91764, on
Wednesday, May 17, 2000, at 7:00 p.m., and at any and all adjournments thereof,
and to vote as I/we have indicated the number of shares which I/we, if
personally present, would be entitled to vote.
1. ELECTION OF DIRECTORS.
FOR all nominees listed below (except as indicated to the contrary below).
Discretionary authority to cumulate votes is granted to the Board.
WITHHOLD AUTHORITY to vote for all nominees listed below
Nominees: George A. Borba, John A. Borba, Ronald O. Kruse, John J. LoPorto,
James C. Seley, San Vaccaro and D. Linn Wiley.
Instruction: To Withhold Authority to vote for any individual nominee(s)
write that nominee's(s') name in the space below.
- --------------------------------------------------------------------------------
2. Approve CVB Financial Corp. 2000 Stock Option Plan.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
3. Ratification of Appointment of Deloitte & Touche as independent public
accountants of the Company for the year ending December 31, 2000.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
4. Other Business. In their discretion, the Proxies are authorized to vote upon
such other business as may properly come before the Meeting and at any and all
adjournments thereof. IF ANY OTHER MATTER IS PRESENTED, YOUR PROXIES WILL VOTE
IN ACCORDANCE WITH THE RECOMMENDATION OF THE BOARD OF DIRECTORS, OR, IF NO
RECOMMENDATION IS GIVEN, IN THEIR OWN DISCRETION. The Board of Directors at
present knows of no other business to be presented at the Meeting.
PLEASE SIGN AND DATE ON REVERSE SIDE
<PAGE> 38
PLEASE SIGN AND DATE BELOW
I/we hereby ratify and confirm all that said attorneys and proxies, or any
of them, or their substitutes, shall lawfully do or cause to be done because of
this proxy, and hereby revoke any and all proxies I/we have given before to vote
at the meeting. I/we acknowledge receipt of the notice of Annual Meeting and the
Proxy Statement which accompanies the notice.
Dated: , 2000
Signed
Signed
Please date this Proxy and sign
above as your name(s) appear(s)
on this card. Joint owners
should each sign personally.
Corporate proxies should be
signed by an authorized
officer. Executors,
administrators, trustees, etc.,
should give their full titles.
THE BOARD OF DIRECTORS
RECOMMENDS A VOTE "FOR" THE
ELECTION OF DIRECTORS NOMINATED
BY THE BOARD OF DIRECTORS,
"FOR" THE 2000 STOCK OPTION
PLAN AND "FOR" RATIFICATION OF
THE APPOINTMENT OF DELOITTE &
TOUCHE. THE PROXY, WHEN
PROPERLY EXECUTED, WILL BE
VOTED AS DIRECTED. IF NO
DIRECTION IS MADE, IT WILL BE
VOTED "FOR" THE ELECTION OF
DIRECTORS NOMINATED BY THE
BOARD OF DIRECTORS, "FOR"
APPROVAL OF THE 2000 STOCK
OPTION PLAN AND "FOR"
RATIFICATION OF THE APPOINTMENT
OF DELOITTE & TOUCHE.
